20
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1995
Commission File Number 0-13473
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Massachusetts 04-2830750
(State or other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
200 Berkeley Street, Boston, MA 02117
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code: (800) 722-5457
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Units of
Limited Partnership Interest
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days:
YES X NO
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. [X]
State the aggregate market value of the voting stock held by non-affiliates
of the registrant: Not applicable, since securities are non-voting.
Documents incorporated by reference: None.
Exhibit Index on Pages 22-31
Page 1 of 53
<PAGE>
TABLE OF CONTENTS
PART I
Item 1 Business 3
Item 2 Properties 7
Item 3 Legal Proceedings 8
Item 4 Submission of Matters to a Vote
of Security Holders 8
PART II
Item 5 Market for the Partnership's Securities and Related
Security Holder Matters 8
Item 6 Selected Financial Data 9
Item 7 Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
Item 8 Financial Statements and Supplementary Data 16
Item 9 Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 16
PART III
Item 10 Directors and Executive Officers of the Partnership 17
Item 11 Executive Compensation 19
Item 12 Security Ownership of Certain Beneficial Owners
and Management 20
Item 13 Certain Relationships and Related Transactions 20
PART IV
Item 14 Exhibits, Financial Statement Schedules, and
Reports on Form 8-K 22
Signatures 32
2
<PAGE>
Part I
Item 1 - Business
The Registrant, John Hancock Properties Limited Partnership (the
"Partnership"), is a Limited Partnership organized on May 17, 1984, under
the Massachusetts Uniform Limited Partnership Act. As of December 31,
1995, the partners in the Partnership consisted of a sole Managing General
Partner, John Hancock Realty Equities, Inc. (the "Managing General
Partner"), an Associate General Partner, JH Associates Limited Partnership
(the "Associate General Partner") and 2,054 Limited Partners owning 21,954
Units of Limited Partnership Interests (the "Units"). The Managing General
Partner is the general partner of the Associate General Partner. Two
Broadway Associates III, an affiliate of Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch"), is the limited partner of the
Associate General Partner. The Managing General Partner and the Associate
General Partner are collectively referred to as the "General Partners".
The initial capital of the Partnership was $6,000, representing capital
contributions of $800 from the Managing General Partner, $200 from the
Associate General Partner and $5,000 from the initial Limited Partner (a
former director of the Managing General Partner). The Amended Agreement of
Limited Partnership of the Partnership (the "Partnership Agreement")
authorized the issuance of up to 35,000 Units at $1,000 per Unit. There
have been no changes in the number of Units outstanding subsequent to the
termination of the offering period.
The Units were offered and sold to the public during the period from
September 21, 1984 to August 31, 1985 pursuant to a Registration Statement
on Form S-11 under the Securities Act of 1933. The Partnership sold the
Units for $1,000 per Unit. No established public market exists on which
the Units may be traded.
The Partnership was formed to engage solely in the acquisition, operation
and disposition of investment real estate. The latest date on which the
Partnership was due to terminate was December 31, 2020, unless it was
sooner terminated in accordance with the terms of the Partnership
Agreement. It was expected that in the ordinary course of the
Partnership's business, the properties of the Partnership would be disposed
of, and the Partnership terminated, before December 31, 2020. As initially
stated in its Prospectus, the sale of the Partnership's last remaining
property was expected to occur within five to eight years following the
date such property was acquired by the Partnership.
3
<PAGE>
Item 1 - Business (continued)
On December 29, 1995, the Partnership sold its last remaining property, the
Fisherman's Village Apartments, which resulted in the termination of the
Partnership's operations. On January 17, 1996, cash in the amount of
$658,620 was distributed to the Limited Partners from the Partnership's net
assets and the Managing General Partner established a reserve for
contingencies with the remaining balance of the Partnership's net assets,
as permitted by, and in accordance with, the terms of the Partnership
Agreement. The reserve for contingencies will be used to fund any possible
liabilities that may arise. If all liabilities are resolved by the end of
1996 and the Managing General Partner determines that funds are available
for distribution, the Managing General Partner expects to make a final
distribution of the Partnership's net assets, in accordance with the terms
of the Partnership Agreement, to the Limited Partners by December 31, 1996.
Such final distribution, if any, would result in the liquidation and
termination of the Partnership. At the time of such final distribution,
the outstanding Units will be cancelled and, in accordance with federal
securities laws, they will be de-registered with the Securities and
Exchange Commission (the "S.E.C."), after which time the Partnership will
no longer be required to file periodic reports with the S.E.C.
As a result of the sale of the Partnership's last remaining property on
December 29, 1995 and, therefore, the termination of the Partnership's
operations, the statement of financial position as of December 31, 1995,
included in Item 8 of this Report, has been prepared on a basis of
accounting which requires that all non-liquid assets be stated at their
estimated net realizable value and all liabilities at their estimated
settlement amounts.
Over the course of the Partnership's operations, its real estate
investments were subject to various risk factors including the fact that
certain of the investments in its portfolio did not generate income
sufficient to meet both operating expenses and debt service, and to fund
adequate reserves for repairs, replacements, contingencies and anticipated
obligations. The income received from the Partnership's properties was
affected by many factors, including fluctuations in occupancy rates and
operating expenses, and variations in rental rates, which in turn were
adversely affected by general economic conditions and local conditions,
such as competitive over-building. As a result, some of the properties in
the Partnership's portfolio were unable to generate sufficient cash flow to
meet both operating expenses and debt service obligations. Therefore the
Partnership was required to utilize funds from other sources to protect its
investments and, in some instances, to dispose of certain properties at a
loss. Since its inception, the Partnership has not generated any
Distributable Cash from Operations, as defined in the Partnership
Agreement.
4
<PAGE>
Item 1 - Business (continued)
On February 28, 1985, the Partnership acquired the Delta Grove Apartments,
a 65-unit garden apartment complex located in Eugene, Oregon. Given the
cash flow constraints of the Partnership, the property's consistent and
favorable income performance and the relative strength of the Eugene real
estate market, the Partnership sold the Delta Grove Apartments on February
28, 1990 for a net sales price of $2,755,559 and retired the related
mortgage indebtedness of $1,472,218. The Partnership received net cash
proceeds of $1,283,341 from this sale. Of this amount, $852,913 was
distributed to the Limited Partners on June 27, 1990. The remaining funds
were used to retire outstanding debts and to pay operating expenses of the
Partnership.
On February 28, 1985, the Partnership acquired the Delta Grove Apartments,
a 65-unit garden apartment complex located in Eugene, Oregon. Given the
cash flow constraints of the Partnership, the property's consistent and
favorable income performance and the relative strength of the Eugene real
estate market, the Partnership sold the Delta Grove Apartments on February
28, 1990 for a net sales price of $2,755,559 and retired the related
mortgage indebtedness of $1,472,218. The Partnership received net cash
proceeds of $1,283,341 from this sale. Of this amount, $852,913 was
distributed to the Limited Partners on June 27, 1990. The remaining funds
were used to retire outstanding debts and to pay operating expenses of the
Partnership.
On December 17, 1985, the Partnership acquired 300 Ramsey Place, an
office/warehouse complex located in San Antonio, Texas. Subsequent to the
Partnership's acquisition of the property, weakening market conditions in
the San Antonio real estate market resulted in the property's inability to
generate sufficient cash to meet both operating expenses and debt service
obligations. In addition, the market value of the property was estimated
to be less than the outstanding balance of the non-recourse mortgage. On
November 7, 1990, the Partnership conveyed the Ramsey Place
office/warehouse to the mortgagee by a deed-in-lieu of foreclosure in
exchange for a release of the outstanding indebtedness.
On August 9, 1984, the Partnership acquired the Waterford Apartments, a 256-
unit garden apartment complex located in Little Rock, Arkansas. Subsequent
to the Partnership's acquisition of the property, market conditions
weakened in the Little Rock real estate market resulting in the property's
inability to generate sufficient cash flow to meet both operating expenses
and debt service requirements. During 1990, the Partnership was unable to
make the requisite mortgage payments on the property, thereby placing the
loan in default. In addition, the market value of the property was
estimated to be less than the outstanding balance of the non-recourse
mortgage. On August 9, 1991, the Partnership conveyed the Waterford
Apartments to the mortgagee by a deed-in-lieu of foreclosure in exchange
for a release of the outstanding indebtedness.
5
<PAGE>
Item 1 - Business (continued)
On September 24, 1984, the Partnership acquired the Huntington Park
Apartments, a 212-unit garden apartment complex located in Tucson, Arizona.
Subsequent to the Partnership's acquisition of the property, market
conditions weakened in the Tucson real estate market resulting in the
property's inability to generate sufficient cash flow to meet both
operating expenses and debt service requirements. During 1990, the
Partnership was unable to make the requisite mortgage payments on the
property, thereby placing the loan in default. In March 1992, the
Partnership secured a reduced payoff amount from the mortgagee for the
related mortgage indebtedness and accrued interest thereon from $5,525,028
to $3,800,000. On March 31, 1992, the Partnership sold the Huntington Park
Apartments to a non-affiliated buyer for a net sales price of $4,072,442.
The Partnership received net cash proceeds of $272,442 from the sale and
extinguishment of the related mortgage indebtedness. These proceeds were
used during 1992 to pay operating expenses of the Partnership.
On February 28, 1985, the Partnership acquired the Northgreen Apartments, a
222-unit garden apartment complex located in Eugene, Oregon. From the
early part of 1992, new apartment construction declined in the Eugene,
Oregon area, where the Northgreen Apartments are located, and absorption of
vacant units continued. With the gradual improvement in market conditions,
the property sustained a stabilized occupancy rate and improved its income
and cash flow performance. Given these market conditions and the income
performance of the property at that time, the Managing General Partner
listed the Northgreen Apartments for sale during the second quarter of
1994. On June 1, 1995, the Partnership sold the Northgreen Apartments to a
non-affiliated buyer for a net sales price of $8,923,560. The Partnership
received net cash proceeds of $4,319,849 from the sale of the property,
representing the excess of the net sales price over the outstanding
mortgage indebtedness on the property of $4,603,711, which indebtedness was
assumed by the Buyer. Of the net cash proceeds, $2,854,020 was distributed
to the Limited Partners on August 15, 1995. The Partnership retained
$1,465,829 of the net cash proceeds to satisfy liabilities of the
Partnership and to fund working capital reserves. This property is also
discussed in Item 7 of this Report and Note 5 to the Financial Statements
included in Item 8 of this Report.
6
<PAGE>
Item 1 - Business (continued)
On November 29, 1984, the Partnership acquired the Fisherman's Village
Apartments, a 280-unit garden apartment complex located in Orlando,
Florida. Although real estate market conditions in the Orlando, Florida
area, where the Fisherman's Village Apartments are located, recovered from
the overbuilding of multi-family residential units which occurred during
the late 1980's and early 1990's, real estate market conditions remained
competitive due to the construction of new multi-family housing units.
Fisherman's Village Apartments was successful in increasing occupancy
levels during 1993 through the use of leasing incentives and capital
improvements made during that year at the property. During 1994,
Fisherman's Village Apartments reduced the level of leasing incentives
offered as market conditions improved and occupancy stabilized. The
Managing General Partner listed the Fisherman's Village Apartments for sale
during April 1995 based upon such market conditions and the operations of
the property. A decline in the property's operations occurred during the
first quarter of 1995, as was anticipated; however, the decline
unexpectedly continued during the second and third quarters of 1995. The
Managing General Partner did not expect a significant improvement in market
conditions over the near term. Given the property's age and future capital
expenditure requirements and the projected cost and availability of long-
term, third party financing when the property's mortgage loan matured on
November 1, 1996, the Managing General Partner determined that a sale of
the property remained in the best interest of the Partnership. On December
29, 1995, the Partnership sold the Fisherman's Village Apartments to a non-
affiliated buyer for a net sales price of $9,376,807 and, on January 3,
1996, paid the outstanding mortgage indebtedness on the property of
$8,193,775, which indebtedness was then held by the Managing General
Partner. The Partnership received net cash proceeds of $1,183,032 from the
sale. This property is also discussed in Item 7 of this Report and Note 5
to the Financial Statements included in Item 8 of this Report.
Within the power accorded to the Managing General Partner under the terms
of the Partnership Agreement, the Managing General Partner contracted,
effective as of January 1, 1992, with Hancock Realty Investors Incorporated
("HRI"), a wholly-owned, indirect subsidiary of John Hancock Mutual Life
Insurance Company ("John Hancock"), to assist the Managing General Partner
in the performance of its management duties as enumerated in the
Partnership Agreement. Effective May 28, 1993, HRI subcontracted with John
Hancock to assist HRI in the performance of its duties as enumerated in the
January 1, 1992 contract. The Partnership has incurred no additional costs
or expenses as a result of these agreements. The Managing General Partner
is further described in Item 10 of this Report.
Industry segment information has not been provided since the Partnership is
engaged in only one industry segment.
Item 2 - Properties
As of December 31, 1995, the Partnership held no properties in its
portfolio.
7
<PAGE>
Item 3 - Legal Proceedings
There are no material pending legal proceedings, other than ordinary
routine litigation incidental to the business of the Partnership, to which
the Partnership is a party or to which any of its properties is subject.
Item 4 - Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders of the Partnership
during the fourth quarter of 1995.
Part II
Item 5 - Market for the Partnership's Securities and Related Security
Holder Matters
(a) Market Information
The Partnership's outstanding securities consist of 21,954 Units originally
sold for $1,000 per Unit. The Units were offered and sold to the public
during the period from September 21, 1984 to August 31, 1985. No
established public market exists on which the Units may be traded.
Consequently, holders of Units may not be able to liquidate their
investments in the event of an emergency, or for any other reason.
Additionally, the assignment or other transfer of Units would be subject to
compliance with the minimum investment and suitability standards imposed by
the Partnership or by applicable law, including state "Blue Sky" laws.
(b) Number of Security Holders
<TABLE>
<CAPTION>
Number of
Record holders Number of Units
as of outstanding as of
Title of Class December 31, 1995 December 31, 1995
-------------- ----------------- -----------------
<S> <C> <C>
Units of Limited Partnership Interests 2,054 21,954
</TABLE>
(c) Dividend History and Restrictions
Since its inception, the Partnership has not generated any Distributable
Cash from Operations, as defined in the Partnership Agreement. Unfavorable
economic conditions, caused by excess supply and weak absorption in the
real estate markets in which the Partnership had invested, adversely
affected the Partnership's income and cash flows. For a further discussion
on the financial condition and results of operations of the Partnership,
see Item 7 of this Report.
8
<PAGE>
Item 6 - Selected Financial Data
The following table sets forth selected financial information regarding the
Partnership's financial position and operating results during the five year
period ended December 31, 1995. This information should be read in
conjunction with Management's Discussion and Analysis of Financial
Condition and Results of Operations, and the related Financial Statements
and Notes thereto, which are included in Items 7 and 8, respectively, of
this Report.
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Rental income $2,234,057 $3,190,235 $3,037,508 $3,123,523 $4,395,970
Interest income 86,029 30,141 48,383 50,168 49,463
Gain/(loss) on sale of
property 4,801,258 - - (1,721,075) -
Net income/(loss) before
extraordinary items 4,535,085 (43,962) (667,686) (2,559,497) (1,464,817)
Net income/(loss) before
extraordinary items per
Limited Partnership Unit 174.32 (1.98) (30.11) (115.42) (66.05)
Extraordinary gain - - - 1,725,028 1,408,255
Extraordinary gain per
Limited Partnership Unit - - - 77.79 63.50
Net income/(loss) 4,535,085 (43,962) (667,686) (834,469) (56,562)
Net income/(loss) per Limited
Partnership Unit 174.32 (1.98) (30.11) (37.63) (2.55)
Ordinary tax income/(loss) 9,825,363 (234,211) (491,166) 788,045 1,689,069
Ordinary tax income/(loss) per
Limited Partnership Unit 395.77 (10.56) (22.15) 35.54 76.17
Cash and cash equivalents * 10,007,798 578,996 444,021 304,288 169,822
Total assets 10,012,360 15,048,648 15,580,544 16,374,987 22,731,022
Mortgage debt ** 8,193,775 13,416,019 13,602,666 13,768,955 19,043,513
Distributable Cash from
Operations - - - - -
Distributable Cash from
Sales or Refinancings 2,854,020 - - - -
Cash distribution per Unit from
Distributable Cash from Sales
or Refinancings 130.00 - - - -
</TABLE>
* 1995 includes net sales proceeds from the sale of the Fisherman's
Village Apartments in the amount of $9,376,807.
** 1995 mortgage debt was paid in full on January 3, 1996 with funds
provided by the sale of the Fisherman's Village Apartments.
9
<PAGE>
Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations
General
- -------
During the offering period (from September 21, 1984 to August 31, 1985),
the Partnership sold 21,954 Units representing gross proceeds of
$21,954,000. The proceeds of the offering were used to acquire investment
properties, fund reserves, and pay acquisition fees, management fees, and
organizational and offering expenses. The Partnership's investment
properties are described in greater detail in Item 1, and Notes 5 and 6 to
the Financial Statements included in Item 8 of this Report.
The latest date on which the Partnership was due to terminate was December
31, 2020, unless it was sooner terminated in accordance with the terms of
the Partnership Agreement. It was expected that in the ordinary course of
the Partnership's business, the properties of the Partnership would be
disposed of, and the Partnership terminated, before December 31, 2020. As
initially stated in its Prospectus, the sale of the Partnership's last
remaining property was expected to occur within five to eight years
following the date such property was acquired by the Partnership. On
December 29, 1995, the Partnership sold its last remaining property, the
Fisherman's Village Apartments, which resulted in the termination of the
Partnership's operations. On January 17, 1996, cash in the amount of
$658,620 was distributed to the Limited Partners from the Partnership's net
assets and the Managing General Partner established a reserve for
contingencies with the remaining balance of the Partnership's net assets,
as permitted by, and in accordance with, the terms of the Partnership
Agreement. The reserve for contingencies, in the amount of approximately
$1,060,000, will be used to fund any possible liabilities that may arise.
If all liabilities are resolved by the end of 1996 and the Managing General
Partner determines that funds are available for distribution, the Managing
General Partner expects to make a final distribution of net assets, in
accordance with the terms of the Partnership Agreement, to the Limited
Partners by December 31, 1996. Such final distribution, if any, will
result in the liquidation and termination of the Partnership. At the time
of such final distribution, the outstanding Units will be cancelled and, in
accordance with federal securities laws, they will be de-registered with
the S.E.C., after which time the Partnership will no longer be required to
file periodic reports with the S.E.C.
10
<PAGE>
Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations (Continued)
Liquidity and Capital Resources
- -------------------------------
On March 13, 1995, the Managing General Partner entered into a Purchase and
Sale Agreement on behalf of the Partnership for the sale of the Northgreen
Apartments property to a non-affiliated buyer (the "Buyer") for a gross
sales price of $9,200,000. On June 1, 1995, the Partnership sold the
Northgreen Apartments to the Buyer and received net sales proceeds of
$8,923,560, after deductions for commissions and selling expenses incurred
in connection with the sale of the property. This transaction generated a
non-recurring gain of $3,983,713, representing the difference between the
net sales price and the property's net book value of $4,939,847. The
Partnership received net cash proceeds of $4,319,849 from the sale of the
property, representing the excess of the net sales proceeds over the
outstanding mortgage indebtedness on the property of $4,603,711, which
indebtedness was assumed by the Buyer. The Partnership retained $1,465,829
of the net sales proceeds to satisfy liabilities of the Partnership and to
fund working capital reserves. The remaining net sales proceeds in the
amount of $2,854,020, or $130 per Unit, were distributed to the Limited
Partners during the third quarter of 1995.
During the second quarter of 1995, the Managing General Partner had the
independent appraiser who had previously appraised the Fisherman's Village
Apartments on June 30, 1994 update its appraisal report. Based upon the
appraiser's investigation and analysis, the property's market value was
estimated to be approximately $9,750,000, which was consistent with the
property's gross sales price of $9,800,000.
On December 6, 1995, the Managing General Partner entered into a Purchase
and Sale Agreement on behalf of the Partnership for the sale of its last
remaining property, the Fisherman's Village Apartments, to a non-affiliated
buyer (the "Purchaser") for a gross sales price of $9,800,000. On December
29, 1995, the Partnership sold the Fisherman's Village Apartments to the
Purchaser and received net sales proceeds of $9,376,807, after deductions
for commissions, selling expenses, and other costs incurred in connection
with the sale of the property. This transaction generated a non-recurring
gain of $817,545, representing the difference between the net sales price
and the property's net book value of $8,559,262. The Partnership received
net cash proceeds of $1,183,032 from the sale of the property, representing
the excess of the net sales proceeds over the outstanding mortgage
indebtedness on the property of $8,193,775, which indebtedness was then
held by the Managing General Partner.
As a result of the sale of the Partnership's last remaining property on
December 29, 1995 and, therefore, the termination of the Partnership's
operations, the statement of financial position as of December 31, 1995,
included in Item 8 of this Report, has been prepared on a basis of
accounting which requires that all non-liquid assets be stated at their
estimated net realizable value and all liabilities at their estimated
settlement amounts.
11
<PAGE>
Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations (Continued)
Liquidity and Capital Resources (continued)
- -------------------------------
As of December 31, 1995, the Partnership had $1,814,023 in cash and cash
equivalents and $8,193,775 in restricted cash, which represents cash
restricted to satisfy the outstanding mortgage indebtedness related to the
Fisherman's Village Apartments property. This amount was paid in full on
January 3, 1996.
Since its inception, the Partnership has not generated any Distributable
Cash from Operations, as defined in the Partnership Agreement. The
Partnership's liquidity has been adversely affected by declining income and
the level of expenditures needed to restore and maintain its properties.
These factors had a significant impact on the Partnership's ability to
generate cash. Due to these cash flow constraints, from 1989 through June
1995, the Partnership was unable to repay the $1,000,000 principal balance
on the short-term loan made by the Managing General Partner to the
Partnership without the Managing General Partner each year making a new,
short-term loan to the Partnership in the outstanding principal amount of
$1,000,000. In addition, from 1991 through the second quarter of 1993,
payments to the Managing General Partner towards the reimbursement of
general and administrative expenses incurred on behalf of the Partnership
by the Managing General Partner and the payment of interest on the short-
term loans referred to above were deferred in order for the Partnership to
meet its working capital needs. The Managing General Partner also made
short-term advances to the Partnership in order to cover operating expenses
that could not be paid from the operating cash flow of the Partnership.
Commencing with the year ended December 31, 1993, the Partnership no longer
deferred the reimbursement of such general and administrative expenses or
the payment of interest. In addition, during the year ended December 31,
1994, the Partnership paid $453,853 to the Managing General Partner as
reimbursement for the short-term advances and towards the then outstanding
balance of the deferred amounts. During June 1995, the Partnership paid in
full the short-term loan in the principal amount of $1,000,000 and
reimbursed the Managing General Partner for the entire outstanding balance
of the deferred amounts in the aggregate amount of $126,834.
During 1995, the Partnership reduced its outstanding mortgage debt by
$5,222,244. Of this amount, $4,603,711 was assumed by the buyer of the
Northgreen Apartments, $118,533 generated from the Partnership's operations
was used to make principal payments on its mortgage debt and $500,000 was
paid by the Partnership to the Managing General Partner in connection with
the Fisherman's Village Apartments mortgage modification on November 1,
1995.
12
<PAGE>
Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations (Continued)
Liquidity and Capital Resources (continued)
- -------------------------------
A balloon payment equal to the entire outstanding principal balance and all
accrued but unpaid interest on the Fisherman's Village Apartments' mortgage
loan in the aggregate amount of $8,749,098 came due on November 1, 1995.
At that time, the Partnership did not have sufficient cash to make such
balloon payment to the lender. The Managing General Partner had pursued
obtaining an extension on the mortgage loan from the lender; however, the
lender would only agree to a six month extension at a cost of two percent
of the outstanding principal balance. After reviewing the terms of the
lender's proposed extension and other third party financing options, the
Managing General Partner determined that it was in the best interest of the
Partnership to have the Managing General Partner provide short-term
financing to the Partnership. On November 1, 1995, the Managing General
Partner purchased the mortgage loan from the existing lender for the amount
of the outstanding principal balance, or $8,693,775. In connection
therewith, the Partnership made a $500,000 lump sum cash payment towards
the outstanding balance of the mortgage loan and the mortgage loan was
modified to i) reflect a reduction in the outstanding balance of the
mortgage loan as a result of the lump-sum cash payment made by the
Partnership to the Managing General Partner; ii) extend the maturity date
of the mortgage to November 1, 1996; iii) allow for prepayment at any time;
and iv) adjust the interest rate on the loan to the base lending rate
charged by the First National Bank of Boston, or 8.75%, payable monthly.
(The Partnership Agreement provides that the Managing General Partner may
loan funds to the Partnership at an interest rate of up to 2% above the
base rate of the First National Bank of Boston.)
On January 3, 1996, the Partnership paid the outstanding mortgage
indebtedness held by the Managing General Partner, in the amount of
$8,193,775, with funds provided by the sale of its last property, the
Fisherman's Village Apartments.
13
<PAGE>
Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations (Continued)
Liquidity and Capital Resources (continued)
- -------------------------------
As of December 31, 1993, the Partnership established a provision against
the entire outstanding balance of the note receivable (the "Note") relating
to the unconditional guaranty obligation for operating deficits granted by
the seller of the Waterford Apartments (the "Obligor"). The Managing
General Partner believed, based on information obtained with respect to the
Obligor's financial condition, that it was probable that the Partnership
would be unable to collect all amounts due from the Obligor in accordance
with the terms of the Note. Accordingly, the Partnership established a
provision against the then entire outstanding balance of the Note in the
amount of $298,058. The provision has since been reduced by $13,903 as a
result of payments made by the Obligor. In June 1994, the Obligor notified
the Partnership that he would be unable to pay either the outstanding
balance of the Note upon its maturity on August 1, 1994 or the minimum
monthly payments due on the Note. Once the Obligor ceased making the
requisite payments on the Note, the Managing General Partner issued a
default notice and demand for payment to the Obligor and filed a complaint
with the court demanding full payment of the Note. On December 7, 1994,
the Partnership was granted a summary judgment in response to the complaint
filed against the Obligor in the amount of the Note plus accrued interest
thereon totaling $305,489. As of the date hereof, the Partnership has not
received payment from the Obligor and the Managing General Partner
continues to pursue collection of the judgment amount. There can be no
assurance that the Partnership will be able to recover all, or any, of the
amounts due from the Obligor.
No capital expenditures were made during 1995.
Results of Operations
- ---------------------
The net income for the year ended December 31, 1995 was $4,535,085 as
compared to a net loss of $43,962 in 1994 and a net loss of $667,686 in
1993. Included in net income for 1995 is a non-recurring gain in the
aggregate amount of $4,801,258 resulting from the sales of the Northgreen
Apartments and the Fisherman's Village Apartments properties. Included in
the net loss for 1993 is a provision in the amount of $298,058 for the
doubtful collection of the note receivable relating to the unconditional
guaranty obligation granted by the seller of the Waterford Apartments.
Rental income for the year ended December 31, 1995 decreased by $956,178,
or 30%, as compared to 1994 and by $803,451, or 26%, as compared to 1993.
The decrease in 1995 as compared to both 1994 and 1993 is primarily due to
the sale of the Northgreen Apartments property on June 1, 1995. Rental
income at the Fisherman's Village Apartments decreased by 7% during 1995 as
compared to 1994. This decrease primarily resulted from a decline in
average occupancy at the property from 94% during 1994 to 90% during 1995.
In addition, rental concessions were offered at the property during 1995 in
an effort to increase occupancy. Rental income at the property was
consistent between 1995 and 1993.
14
<PAGE>
Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations (Continued)
Results of Operations (continued)
- ---------------------
Interest income for the year ended December 31, 1995 increased by $55,888,
or 185%, as compared to 1994, and by $37,646, or 78%, as compared to 1993.
These increases were primarily due to an increase in the Partnership's cash
and cash equivalents and an increase in the interest rates earned on such
amounts. Cash and cash equivalents increased significantly due to the sale
of the Northgreen Apartments on June 1, 1995.
Interest expense for the year ended December 31, 1995 decreased by
$278,810, or 24%, as compared to 1994, and by $329,711, or 28%, as compared
to 1993. The decrease in 1995 as compared to both 1994 and 1993 was
primarily due to the sale of the Northgreen Apartments property. In
addition, during 1995 the Partnership repaid the entire outstanding balance
of the short-term loan made by the Managing General Partner resulting in a
further decrease in interest expense. Interest expense with respect to the
Fisherman's Village Apartments property was consistent between periods.
Property operating expenses in 1995 decreased by $278,017, or 20%, as
compared to 1994 and by $383,094, or 26%, as compared to 1993. The
decrease in 1995 was primarily due to the sale of the Northgreen
Apartments. Property operating expenses at the Fisherman's Village
Apartments increased in 1995 by approximately 8% as compared to 1994. This
increase was primarily due to an increase in maintenance and repair
expenses incurred as a result of plumbing repairs required at the property
and unusually high turnover of rental units during 1995. Property
operating expenses at the Fisherman's Village Apartments property were
consistent in 1995 as compared to 1993.
Depreciation in 1995 decreased by $151,078, or 24%, as compared to 1994 and
by $172,525, or 27%, as compared to 1993. This decrease in 1995 was
primarily due to the sale of the Northgreen Apartments property on June 1,
1995.
General and administrative expenses in 1995 increased by $15,923, or 11%,
as compared to 1994 and by $16,070, or 12% as compared to 1993. The
increase in 1995 as compared to 1994 and 1993 is primarily due to an
increase in the time required to be expended by the General Partner and
expenses incurred in connection with the sales of the Northgreen Apartments
and Fisherman's Village Apartments properties.
As of December 31, 1993, the Managing General Partner established an
allowance against the $298,058 outstanding balance of the note receivable
relating to the unconditional guaranty obligation granted by the seller of
the Waterford Apartments. During 1994, the Partnership received payments
on the note totaling $13,903. However, the Obligor is in default on the
note for failure to make the minimum required payments due since June 1,
1994 and for failure to pay the outstanding balance of the note, which was
due on August 1, 1994. (This note receivable is also discussed in Note 7
to the Financial Statements included in Item 1 of this Report).
The Managing General Partner believes that inflation has had no significant
impact on the Partnership during the last three fiscal years.
15
<PAGE>
Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations (Continued)
Cash Flow
- ---------
The following table provides the calculations of Adjusted Cash from
Operations and Distributable Cash from Operations, which are calculated in
accordance with Section 17 of the Partnership Agreement:
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net cash provided by/(used in)
operating activities (a) $204,699 $321,622 $306,022 ($32,208) ($249,570)
Net change in operating assets
and liabilities (a) 2,411 258,777 (29,842) (86,965) (604,908)
-------- -------- -------- ------- --------
Cash provided by/(used in)
operations (a) 207,110 580,399 276,180 (119,173) (355,338)
Principal payments on long-term debt
(exclusive of payments for
retirement of debt) (118,533) (186,647) (166,289) (105,768) (80,619)
-------- -------- -------- ------- --------
Cash provided by/(used in) operations,
as adjusted 88,577 393,752 109,891 (224,941) (435,957)
Increase in working capital reserves (88,577) 393,752) (109,891) - -
-------- -------- -------- ------- --------
Adjusted Cash from Operations (b) - - - (224,941) (435,957)
Decrease in working capital reserves - - - 224,941 435,957
-------- -------- -------- ------- --------
Distributable Cash from Operations (b) $- $- $- $- $-
======== ======== ======== ======= ========
</TABLE>
(a) Net cash provided by/(used in) operating activities, net change in
operating assets and liabilities, and cash provided by/(used in)
operations are as calculated in the Statements of Cash Flows included
in Item 8 of this Report.
(b) As defined in the Partnership Agreement. Distributable Cash from
Operations should not be considered as an alternative to net income
(i.e. not an indicator of performance) or to reflect cash flows or
availability of discretionary funds.
Item 8 - Financial Statements and Supplementary Data
The response to this Item appears beginning on page F-1 of this Report.
Item 9 - Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
No events requiring disclosure under this Item have occurred.
16
<PAGE>
Part III
Item 10 - Directors and Executive Officers of the Partnership
(a-b) Identification of Directors and Executive Officers
By virtue of its organization as a Limited Partnership, the Partnership has
no directors or executive officers. As indicated in Item 1 of this Report,
the Managing General Partner of the Partnership is John Hancock Realty
Equities, Inc., a Delaware corporation. Pursuant to terms of the
Partnership Agreement, the Managing General Partner is solely responsible
for the management of the Partnership's business. The names and ages of
the directors and executive officers of the Managing General Partner are as
follows:
Name Title Age
---- ----- ---
William M. Fitzgerald President and Director 52
Malcolm G. Pittman, III Director 44
Susan M. Shephard Director 43
Richard E. Frank Treasurer (Chief Accounting Officer) 34
(c) Identification of certain significant persons
The Managing General Partner is responsible for the identification,
analysis, purchase, operation, and disposal of specific Partnership real
estate investments. The Managing General Partner has established a Real
Estate Investment Committee utilizing senior real estate personnel of John
Hancock and its affiliates to review each proposed investment. The members
of the Real Estate Investment Committee are designated each year at the
annual meeting of the Board of Directors of John Hancock Realty Equities,
Inc. and are as follows:
Name Title Age
---- ----- ---
Edward P. Dowd Senior Vice President of 53
John Hancock's Real Estate
Investment Group
Kevin McGuire Vice President of John Hancock's 49
Real Estate Investment Group,
President of John Hancock Realty
Services Corp. and subsidiaries
Stephen Kindl Senior Investment Officer of 38
John Hancock's Real Estate
Investment Group, Assistant Vice
President of John Hancock Realty
Equities, Inc.
(d) Family relationships
There exist no family relationships among any of the foregoing directors or
officers of the Managing General Partner.
17
<PAGE>
Item 10 - Directors and Executive Officers of the Partnership (continued)
(e) Business experience
William M. Fitzgerald (age 52), joined John Hancock in 1968. He has been
President and a Director of the Managing General Partner, and a Senior
Investment Officer of John Hancock, since June 1993 and a Managing Director
of Hancock Realty Investors Incorporated since November 1991. His term as
a Director of the Managing General Partner expires in May 1996. From 1987
to 1991, Mr. Fitzgerald was a Senior Vice President of John Hancock
Properties, Inc. Prior to that time, he held a number of positions
including Senior Real Estate Management Officer and Real Estate Management
Officer of John Hancock. He holds an M.B.A. from Boston University and a
B.A. from Boston College.
Malcolm G. Pittman (age 44), joined John Hancock in 1986 as an Assistant
Counsel. He has been a Director of the Managing General Partner since
November 1991. His term as a Director of the Managing General Partner
expires in May 1996. Mr. Pittman has been Counsel of John Hancock's Real
Estate Law Division since 1993. From 1989 to 1993, he was an Associate
Counsel of John Hancock. He holds a J.D. from Yale Law School and a B.A.
from Oberlin College.
Susan M. Shephard (age 43), joined John Hancock in 1985 as an Attorney.
She has been a Director of the Managing General Partner since November
1991. Her term as a Director of the Managing General Partner expires in
May 1996. Ms. Shephard has been a Mortgage Investment Officer of John
Hancock since 1991. From 1988 to 1991, she was an Associate Counsel of
John Hancock and from 1987 to 1988, she was an Assistant Counsel of John
Hancock. She holds a J.D. from Georgetown University Law Center and a B.A.
from the University of Rhode Island.
Richard E. Frank (age 34), joined John Hancock in 1983. He has been
Treasurer of the Managing General Partner since June 1993. Mr. Frank has
been an Associate Investment Officer of John Hancock since January 1995.
From 1993 to 1995, Mr. Frank was a Senior Financial Administrator of John
Hancock; from 1991 to 1993, he was an Associate of Hancock Realty
Investors, Incorporated; from 1990 to 1991, he held the position of
Assistant Treasurer of John Hancock Realty Services Corp. He holds a B.S.
from Stonehill College.
Edward P. Dowd (age 53), joined John Hancock in 1970. He has been a
Director of Hancock Realty Investors, Incorporated since 1991, and a
Director of John Hancock Realty Services Corp. and subsidiaries and John
Hancock Property Investors Corp. since 1987. Mr. Dowd has been a Senior
Vice President of John Hancock since 1991. From 1989 to 1990, he was a
Vice President of John Hancock and from 1986 to 1989, he was a Second Vice
President of John Hancock. Prior to that time, he held a number of
positions including Senior Real Estate Investment Officer and Real Estate
Investment Officer of John Hancock. From July 1982 to May 1986, Mr. Dowd
was President of the Managing General Partner. He holds an A.B. from
Boston College.
18
<PAGE>
Item 10 - Directors and Executive Officers of the Partnership (continued)
(e) Business experience (continued)
Kevin McGuire (age 49), joined John Hancock in 1968. He has been a Vice
President of John Hancock since June 1993 and President of John Hancock
Realty Services Corp. and subsidiaries since July 1993. He has been a
Managing Director and a Director of Hancock Realty Investors, Incorporated
since 1991, and a Director of John Hancock Property Investors Corp. since
1987. Mr. McGuire served as an interim basis President of the Managing
General Partner from May 1991 to November 1991 and was President of John
Hancock Properties, Inc. from 1987 to 1991. Prior to that time, he held a
number of positions including Second Vice President, Senior Real Estate
Investment Officer and Real Estate Investment Officer of John Hancock. He
holds an M.B.A. from Babson College and a B.A. from Boston College.
Stephen Kindl (age 38), joined John Hancock in 1995 as a Senior Real Estate
Investment Officer. Prior to joining John Hancock, he held a number of
positions with Aetna Real Estate Investment, Inc., including Managing
Director and Director. He holds an M.B.A. from the University of Hartford
and a B.S. from the University of Connecticut
(f) Involvement in certain legal proceedings
None
Compliance with Section 16(a) of the Exchange Act
Under Section 16(a) of the Securities Exchange Act of 1934, as amended, the
Managing General Partner's directors and executive officers, as well as any
person holding more than ten percent of the Units, are required to report
their initial ownership of Units and any subsequent change in such
ownership to the Securities and Exchange Commission and the Partnership
(such requirements hereinafter referred to as "Section 16(a) filing
requirements"). Specific time deadlines for Section 16(a) filing
requirements have been established.
To the Partnership's knowledge, no officer or director of the Managing
General Partner has an ownership interest in the Partnership and no person
holds more than 10% of the Units.
Item 11 - Executive Compensation
None of the officers or directors of the Managing General Partner or any of
the Real Estate Investment Committee members referred to in Item 10(c)
receive any current direct remuneration in their capacities as officers,
directors or Real Estate Investment Committee members, pursuant to any
standard arrangements or otherwise, from the Partnership nor is any such
remuneration currently proposed. In addition, the Partnership has not
given and does not propose to give any options, warrants or rights,
including stock appreciation rights, to any such person. No long-term
incentive plan exists with such persons and no remuneration plan or
arrangement exists with such persons resulting from his/her resignation,
retirement or any other termination. Therefore, tables relating to these
topics have been omitted.
Compensation Committee Interlocks and Insider Participation:
19
<PAGE>
Item 12 - Security Ownership of Certain Beneficial Owners and Management
The Partnership did not have a Compensation Committee in 1995 and does not
currently have such a committee. No current or former officer or employee
of the Managing General Partner or its Affiliates participated during the
1995 fiscal year in deliberations regarding the Managing General Partner's
compensation as it relates to the Partnership.
By virtue of its organization as a limited partnership, the Partnership has
no outstanding securities with traditional voting rights. However, as
provided in Section 13.1 of the Partnership Agreement (and subject to
Section 13.3 thereof), 10% or more in interest of the Limited Partners may
request that the Managing General Partner call a meeting or solicit written
consent of the Limited Partners as to any matter set forth in Section 13.2,
which section provides that a majority in interest of the Limited Partners,
without the concurrence of the General Partners, may:
(1) Amend the Partnership Agreement;
(2) Dissolve the Partnership;
(3) Remove any General Partner and elect a replacement therefor; and
(4) Approve or disapprove the sale of all or substantially all of the
assets of the Partnership.
a) Security ownership of certain beneficial owners
No person or group, including the General Partners, is known to own
beneficially more than 5% of the Partnership's 21,954 outstanding Units
as of December 31, 1995.
b) Security ownership of management
By virtue of its organization as a limited partnership, the Partnership
has no officers or directors. Neither the Managing General Partner nor
any officer or director of the Managing General Partner possesses the
right to acquire a beneficial ownership of Units.
c) Changes in control
The Partnership does not know of any arrangements the operations of
which may at a subsequent date result in a change in control of the
Partnership.
Item 13 - Certain Relationships and Related Transactions
See Note 4 of the Notes to Financial Statements included in Item 8 of this
Report for a description of certain transactions and related amounts paid
by the Partnership to the General Partners and their Affiliates during
1995, 1994 and 1993.
In accordance with the terms of the Partnership Agreement, the General
Partners and/or their Affiliates, as defined in the Partnership Agreement,
are entitled to the following types of compensation, fees,
profits/(losses), expense reimbursements and distributions:
20
<PAGE>
Item 13 - Certain Relationships and Related Transactions (continued)
An affiliate of the Managing General Partner is entitled to receive a
Property Management Fee for providing property management services for
Partnership properties. The Partnership is obligated to pay a fee equal to
the amount customarily charged in arm's-length transactions by third
parties rendering comparable services for comparable properties in the
localities where such properties are located but in no event may such fee
exceed 6% of the gross receipts of the property under management. No
affiliate of the Managing General Partner is providing, nor has provided,
property management services to the Partnership. Therefore, the
Partnership did not pay any such fees during 1995, 1994 and 1993.
The General Partners and their Affiliates are also entitled to
Reimbursement for Expenses relating to the administrative services
necessary to the prudent operation of the Partnership, such as legal,
accounting, computer, transfer agent and other services. The amounts
charged to the Partnership for such administrative services may not exceed
the lesser of the General Partners' or such Affiliates' costs or 90% of
those which the Partnership would be required to pay to independent parties
for comparable services in the same geographic area. The Partnership
incurred $107,478, $79,420 and $78,390 of such expenses during the years
ended December 31, 1995, 1994 and 1993, respectively.
Upon the disposition of any property, the General Partners are entitled to
a Subordinated Real Estate Commission (as defined in the Partnership
Agreement) for rendering substantial services in connection with the sale
of such property in the amount of 3% of the sales price of such property.
However, no such Subordinated Real Estate Commission may be paid until all
Limited Partners first have received a return of their total Invested
Capital plus any previously unpaid cumulative return on investment of 7%
per annum as defined in Section 8.2 of the Partnership Agreement. The
Partnership has never paid any such Subordinated Real Estate Commission.
A Share of the Partnership's Distributable Cash from Operations (as defined
in the Partnership Agreement) is distributable to the General Partners.
Distributable Cash from Operations is distributable in accordance with
Section 8 of the Partnership Agreement (as described more fully in Note 3
to the Financial Statements included in Item 8 of this Report). The
Partnership did not generate any Distributable Cash from Operations since
its inception and, as such, the General Partners have not received any such
distributions.
A Share of Cash from Sales or Refinancings (as defined in the Partnership
Agreement) may be distributed to the General Partners. Cash from Sales or
Refinancings is distributable in accordance with Section 8 of the
Partnership Agreement (as described more fully in Note 3 to the Financial
Statements included in Item 8 of this Report). The General Partners were
not entitled to receive any such distributions during 1995, 1994 and 1993.
21
<PAGE>
Item 13 - Certain Relationships and Related Transactions (continued)
A Share of the Partnership's Profits or Losses for Tax Purposes (as defined
in the Partnership Agreement) is allocable to the General Partners. Such
allocation of profits, except for profits from the sale of the last of the
Partnership's properties, generally approximates, insofar as practicable,
their percentage share of Distributable Cash from Operations and Cash from
Sales or Refinancings. The General Partners are generally allocated 1% of
Partnership Losses for tax purposes. Profits from the sale of the last of
the Partnership's properties are allocated first to such partners in an
amount equal to any negative balance in their capital accounts, and then in
the same manner as profits from normal operations. The General Partners'
Share of such Profits or Losses were profits of $1,136,540 for the year
ended December 31, 1995 and losses of $2,342 and $4,912 for the years ended
December 31, 1994 and 1993, respectively.
This table reflects all compensation, fees, profits/(losses), expense
reimbursements and distributions from the Partnership to the General
Partners and their Affiliates:
1995 1994 1993
---- ---- ----
Operating Expenses (a) $107,478 $79,420 $78,390
General Partners' Share of
Profits/(Losses) 1,136,540 (2,342) (4,912)
(a) Represents amounts incurred for the years ending December 31, 1995,
1994 and 1993. Prior to 1993, the Partnership deferred the payment
of expense reimbursements in order to meet its working capital
needs. During the years ended December 31, 1993 and 1994, the
Partnership no longer deferred such payments and during the years
ended December 31, 1995 and 1994, the Partnership made payments
towards these deferred amounts. As a result, amounts paid to the
General Partners and their Affiliates during the years ended
December 31, 1995, 1994 and 1993 do not reflect the amounts
incurred during each period.
Part IV
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) (1) and (2) - Listed on Index to Financial Statements and Financial
Statement Schedules.
(3) - Listing of Exhibits
Exhibit Number Page Number or
Under Incorporation by
Regulation S-K Description Reference
4 Instruments defining the rights
of security holders
22
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
4.1 Amended Agreement of Limited Exhibit A to final
Partnership* Prospectus dated
September 21, 1984,
filed under the
Partnership's
Form S-11
Registration
Statement
(File 2-91210)
(a) Amendment to the Amended Agreement Exhibit 4.1(a) to Post-
of Limited Partnership dated as of Effective Amendment No. 1
December 1, 1984* No. 1 to the
Partnership's
Form S-11
Registration
Statement
(File 2-91210)
4.2 The Subscription Agreement and Exhibit D to final
Limited Partner Signature Page Prospectus dated
and Power of Attorney whereby a September 21, 1984,
subscriber agrees to purchase filed under the
Units and adopts the provisions Partnership's
of the Partnership Agreement* Form S-11
Registration
Statement
(File 2-91210)
4.3 Copy of Tenth Amendment and Exhibit 4.3 to
Restatement of Certificate of Item 14 to the
Limited Partnership filed with Partnership's
the Massachusetts Secretary of Report on Form 10-K
State on August 30, 1985* dated December 31, 1986
(File 0-13473)
10 Material contracts and other
documents
10.1 Form of Consulting Agreement Exhibit 10.2 to the
between the Managing General Partnership's
Partner and Merrill Lynch, Form S-11
Hubbard Inc.* Registration
Statement
(File 2-91210)
10.2 Copy of revised letter from Exhibit 10.5(a) to
John Hancock Subsidiaries, Inc. Post-Effective
containing undertaking as to Amendment No. 1 to
the net worth of the Managing the Partnership's
General Partner* Form S-11
Registration Statement
(File 2-91210)
23
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
10.3 Documents relating to Waterford
Apartments
(a) Developer Note dated Exhibit 10.6(b) to
April 18, 1983, from Waterford Amendment No. 1 to
Partners to Savers Federal the Partnership's
Savings and Loan Association* Form S-11
Registration
Statement
(File 2-91210)
(b) Allonge to Note dated Exhibit 10.3(b)
January 25, 1988, between to Item 14 to the
Savers Federal Savings and Partnership's
Loan Association and Report on Form 10-K
Waterford Partners* dated December 31, 1987
(File 0-13473)
(c) Limited Guaranty dated Exhibit 10.3(c)
January 25, 1988, between to Item 14 to the
John Hancock Properties Partnership's
Limited Partnership and Report on Form 10-K
Savers Federal Savings dated December 31, 1987
and Loan Association (File 0-13473)
and Waterford Partners*
(d) Deed of Trust and Security Exhibit 10.6(c) to
Agreement dated April 18, 1983, Amendment No. 1 to
by Waterford Associates to the Partnership's
John Kooistra, Jr., Trustee* Form S-11
Registration
Statement
(File 2-91210)
(e) Amendment to Deed of Trust Exhibit 10.3(e)
and Security Agreement dated to Item 14 to the
January 25, 1988, between Partnership's
Savers Federal Savings and Report on Form 10-K
Loan Association and dated December 31, 1987
John Hancock Properties (File 0-13473)
Limited Partnership*
(f) Regulatory Agreement and Exhibit 10.6(d) to
Declaration of Restrictive Amendment No. 1 to
Covenants dated April 18, 1983, the Partnership's
by and among Residential Housing Form S-11
Facilities Board of Pulaski Registration
County, Arkansas, United States Statement
Trust Company of New York, as (File 2-91210)
Trustee, and Waterford Partners*
24
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
(g) Assumption Agreement dated Exhibit 10.6(f) to
August 9, 1984, by and among Amendment No. 1 to
Residential Housing Facilities the Partnership's
Board of Pulaski County, Form S-11
United States Trust Company of Registration
New York and First Commercial Statement
Bank, N.A., as Trustees, (File 2-91210)
Waterford Partners,
John Hancock Properties
Limited Partnership, and Savers
Federal Savings and Loan
Association*
(h) Repurchase Agreement dated Exhibit 10.6(g) to
August 9, 1984, between Amendment No. 1 to
Waterford Partners and the Partnership's
John Hancock Properties Limited Form S-11
Partnership* Registration
Statement
(File 2-91210)
(i) Escrow Agreement among Exhibit 10.6(i) to
Little Rock Abstract Company, Amendment No. 1 to
John Hancock Properties Limited the Partnership's
Partnership and Waterford Form S-11
Partners* Registration
Statement
(File 2-91210)
(j) Unconditional Guaranty Agreement Exhibit 10.6(j) to
dated July 2, 1984, as amended Amendment No. 1 to
by letter dated August 15, 1984, the Partnership's
executed by Mike Henderson* Form S-11
Registration
Statement
(File 2-91210)
(k) Promissory Note dated Exhibit 10.3(k)
December 23, 1987, between to Item 14 to the
John M. Henderson and Partnership's
John Hancock Properties Report on Form 10-K
Limited Partnership* dated December 31, 1987
(File 0-13473)
(l) Deed-in-Lieu of Foreclosure Exhibit 10.2(e) to the
between Resolution Trust Corporation Amendment No. 1 to
as Conservator for Savers Federal the Partnership's
Savings and Loan Association and Report on Form 10-K
John Hancock Properties Limited dated December 31, 1991
Partnership* (File 0-13473)
25
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
10.4 Documents relating to
Huntington Park Apartments
(a) Promissory Note dated May 4, Exhibit 10.7(b) to
1983, from VSP Housing Amendment No. 1 to
Associates 101 to Western the Partnership's
Savings and Loan Association* Form S-11
Registration
Statement
(File 2-91210)
(b) Deed of Trust dated May 4, 1983, Exhibit 10.7(c) to
between VSP Housing Amendment No. 1 to
Associates 101 and Western the Partnership's
Savings and Loan Association* Form S-11
Registration
Statement
(File 2-91210)
(c) Deed and Deed Restrictions dated Exhibit 10.7(d) to
as of March 1, 1983, from Amendment No. 1 to
The Industrial Development the Partnership's
Authority of the City of Tucson, Form S-11
Arizona to VSP Housing Registration
Associates 101* Statement
(File 2-91210)
(d) Rental Escrow Agreement dated Exhibit 10.7(f) to
September 24, 1984, between VSP Post-Effective
Housing Associates 101, Amendment No. 1 to
John Hancock Properties Limited the Partnership's
Partnership and Ticor Title Form S-11
Insurance Company of California* Registration
Statement
(File 2-91210)
(e) Deed of Trust and Security Exhibit 10.7(i) to
Agreement dated December 14, Post-Effective
1984, between John Hancock Amendment No. 1 to
Properties Limited Partnership, the Partnership's
Ticor Title Insurance Company of Form S-11
California and John Hancock Registration
Realty Services Corp.* Statement
(File 2-91210)
(f) Purchase and Sale Agreement Exhibit 1 to the
between John Hancock Properties Partnership's Report
Limited Partnership and on Form 8-K dated
Pacific Institutional Advisors March 31, 1992
dated February 14, 1992 * (File 0-13473)
26
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
(g) Loan Payoff Agreement between Exhibit 2 to the
Resolution Trust Corporation and Partnership's Report
John Hancock Properties Limited on Form 8-K dated
Partnership dated March 19, 1992 * March 31, 1992
(File 0-13473)
10.5 Documents relating to Fisherman's
Village Apartments
(a) Promissory Note dated Exhibit 10.11(a) to
October 17, 1985, from Item 14 of the
John Hancock Properties Partnership's Report
Limited Partnership to on Form 10-K dated
Pacific Mutual Life December 31, 1985
Insurance Company* (File 0-13473)
(b) Mortgage and Security Exhibit 10.11(b) to
Agreement dated Item 14 of the
October 16, 1985, between Partnership's Report
John Hancock Properties on Form 10-K dated
Limited Partnership and December 31, 1985
Pacific Mutual Life (File 0-13473)
Insurance Company*
(c) Pledge and Assignment of Account Exhibit 10.11(e) to
dated October 16, 1985, between Item 14 of the
John Hancock Properties Limited Partnership's Report
Partnership and Pacific Mutual on Form 10-K dated
Life Insurance Company* December 31, 1985
(File 0-13473)
(d) Hold Harmless and Escrow Exhibit 10.11(f) to
Agreement dated October, 1985, Item 14 of the
between John Hancock Properties Partnership's Report
Limited Partnership and on Form 10-K dated
Ticor Title Insurance* December 31, 1985
(File 0-13473)
(e) Promissory Note and Mortgage Renewal Exhibit 10.5(e) to
and Modification Agreement between Item 14 of the
Pacific Mutual Life Insurance Partnership's Report
Company and John Hancock Properties on Form 10-K dated
Limited Partnership* December 31, 1992
(File 0-13473)
(f) Assignment of Mortgage and Exhibit 1 to Item 7 of
Assignment of Mortgage Loan the Partnership's Report
Documents between Pacific Mutual on Form 8-K dated
Life Insurance Company and November 1, 1995
John Hancock Realty Equities, Inc. (File 0-13473)
dated November 1, 1995*
27
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
(g) Renewal Note between John Hancock Exhibit 2 to Item 7 of
Properties Limited Partnership and the Partnership's Report
John Hancock Realty Equities, Inc. on Form 8-K dated
dated November 1, 1995* November 1, 1995
(File 0-13473)
(h) Mortgage Modification Agreement Exhibit 3 to Item 7 of
between John Hancock Properties the Partnership's Report
Limited Partnership and John on Form 8-K dated
Hancock Realty Equities, Inc. November 1, 1995
dated November 1,1995* (File 0-13473)
(I) Purchase and Sale Agreement between Exhibit 1 to Item 7 of
John Hancock Properties Limited the Partnership's Report
Partnership and United Dominion on Form 8-K dated
Realty Trust, Inc. dated December 29, 1995
December 6, 1995* (File 0-13473)
10.6 Documents relating to Northgreen
Apartments
(a) Promissory note dated Exhibit 10.6(a)
September 12, 1988 from to Item 14 of the
John Hancock Properties Limited Partnership's Report
Partnership to Great West Life on Form 10-K dated
Assurance Company* December 31, 1988
(File 0-13473)
(b) Trust Deed with Security Agreement Exhibit 10.6(b)
dated September 12, 1988 between to Item 14 of the
John Hancock Properties Limited Partnership's Report
Partnership and Great West Life on Form 10-K dated
Assurance Company* December 31, 1988
(File 0-13473)
(c) Absolute Assignment of Leases Exhibit 10.6(c)
dated September 12, 1988 from to Item 14 of the
John Hancock Properties Limited Partnership's Report
Partnership to Great West Life on Form 10-K dated
Assurance Company* December 31, 1988
(File 0-13473)
(d) Promissory Note and Mortgage Exhibit 10.6(d)
Renewal and Modification Agreement to Item 14 of the
between John Hancock Properties Partnership's Report
Limited Partnership and Great West on Form 10-K dated
Life Assurance Company* December 31, 1993
(File 0-13473)
28
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
(e) Purchase and Sale Agreement between Exhibit 1 to Item 7 of
John Hancock Properties Limited the Partnership's Report
Partnership and Northgreen Partners on Form 8-K dated
dated March 13, 1995* June 1, 1995
(File 0-13473)
(f) Loan Assignment and Assumption Exhibit 2 to Item 7 of
Agreement between Great West the Partnership's Report
Life & Annuity Insurance Company, on Form 8-K dated
John Hancock Properties Limited June 1, 1995
Partnership and Northgreen Partners (File 0-13473)
dated May 9, 1995*
10.7 Documents relating to
Delta Grove Apartments
(a) Promissory Note dated Exhibit 10.9(a) to
February 28, 1985, the Partnership's
from John Hancock Report on Form 10-K
Properties Limited dated December 31, 1984
Partnership to Delta Grove (File 2-91210)
Development Company*
(b) Deed of Trust dated Exhibit 10.9(b) to
February 25, 1985, by the Partnership's
Delta Grove Development Company Report on Form 10-K
to John Hancock Properties dated December 31, 1984
Limited Partnership* (File 2-91210)
(c) Security Agreement dated Exhibit 10.9(c) to
February 28, 1985, between the Partnership's
John Hancock Properties Limited Report on Form 10-K
Partnership and Delta Grove dated December 31, 1984
Development Company* (File 2-91210)
(d) Memorandum of Understanding Exhibit 10.9(e) to
dated February 28, 1985, the Partnership's
between Delta Grove Development Report on Form 10-K
Company and John Hancock dated December 31, 1984
Properties Limited Partnership* (File 2-91210)
(e) Assignment of Residential Exhibit 10.9(g) to the
Property Management Agreement Partnership's Report
dated February 28, 1985, on Form 10-K dated
between Beam & James and December 31, 1984
Bennett Management Company* (File 2-91210)
(f) Purchase and Sale Agreement Exhibit 10.7(e) to
between John Hancock Properties Amendment No. 1 to
Limited Partnership and Whittaker the Partnership's Report
Realty Group, Inc.* on Form 10-K dated
December 31, 1991
(File 0-13473)
29
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
10.8 Documents relating to
Ramsey Place
(a) Deed of Trust Note dated Exhibit 10.12(a) to the
December 17, 1985, from Partnership's Report
John Hancock Properties of Form 10-K dated
Limited Partnership to December 31, 1985
National Life Insurance (File 0-13473)
Company*
(b) Deed of Trust and Security Exhibit 10.12(b) to the
Agreement dated December 17, Partnership's Report
1985, between John Hancock of Form 10-K dated
Properties Limited Partnership December 31, 1985
and National Life Insurance (File 0-13473)
Company*
(c) Rent Escrow Agreement dated Exhibit 10.12(d) to the
December 17, 1985, between Partnership's Report
John Hancock Properties of Form 10-K dated
Limited Partnership and December 31, 1985
Alamo Title Co. and Ramsey (File 0-13473)
Place, Ltd.*
(d) Escrow Agreement regarding funds Exhibit 10.12(e) to the
for improvement of Ramsey Road Partnership's Report
dated December 17, 1985, between of Form 10-K dated
John Hancock Properties Limited December 31, 1985
Partnership and Ramsey Place, Ltd.* (File 0-13473)
(e) Escrow Agreement regarding Exhibit 10.12(f) to the
completion of work dated Partnership's Report
December 17, 1985,between John of Form 10-K dated
Hancock Properties Limited December 31, 1985
Partnership and Ramsey Place, Ltd. (File 0-13473)
and Alamo Title Co.*
(f) Special Warranty Deed between Exhibit 10.8(g) to
John Hancock Properties Limited Amendment No. 1 to
Partnership and National Life the Partnership's Report
Insurance Company * on Form 10-K dated
December 31, 1990
(File 0-13473)
10.9 Promissory Note dated Exhibit 10.9 to the
December 1, 1994 between Partnership's Report on
John Hancock Realty Equities, Inc. Form 10-K dated
and John Hancock Properties December 31, 1994
Limited Partnership* (File 0-13473)
30
<PAGE>
Item 14 - Exhibits, Financial Statement Schedules and Reports on Form 8-K
(Continued)
10.10 Documents relating to Management
Agreement
(a) Management Agreement dated Exhibit 10.10 (a) to the
January 1, 1992 between Hancock Partnership's Report on
Realty Investors Incorporated and Form 10-K dated
John Hancock Realty Equities* December 31, 1992
(File 0-13473)
(b) Agreement dated May 28, 1993 Exhibit 10.10(b) to the
Concerning Subcontracting of Partnership's Report on
Management Services Pertaining to Form 10-K dated
John Hancock Properties Limited December 31, 1993
Partnership between John Hancock (File 0-13473)
Realty Equities, Inc., Hancock
Realty Investors, Incorporated
and John Hancock Mutual Life
Insurance Company*
10.11 Documents relating to Executive
Compensation Plans and Arrangements
(a) Partnership Agreement* Exhibit 4.1(a) to Post-
Effective Amendment No. 1
to the Partnership's
Form S-11 Registration
Statement
(File 2-91210)
(b) During the quarter ended December 31, 1995, the Partnership filed two
reports on From 8-K. The first, dated November 1, 1995, disclosed the
short-term financing arrangement between the Managing General Partner
and the Partnership relating to the maturity of the Fisherman's
Village Apartments property's mortgage. The second, dated December
29, 1995, disclosed the terms of the sale of the Fisherman's Village
Apartments property and included the following Pro Forma Financial
Statements:
Pro Forma Balance Sheet at September 30, 1995
Pro Forma Statement of Operations for the Nine Months Ended
September 30, 1995
Pro Forma Statement of Operations for the Year Ended December 31,
1994
(c) Exhibits - See Item 14 (a) (3) of this Report.
(d) Financial Statement Schedules - The response to this portion of Item
14 is submitted as a separate section of this Report commencing on
Page F-21.
- -------------------------------
+Filed herewith
*Incorporated by reference
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be
signed on its behalf by the undersigned, thereunto duly authorized, on the
29th day of March, 1996.
John Hancock Properties Limited Partnership
By: John Hancock Realty Equities, Inc.,
Managing General Partner
By: WILLIAM M. FITZGERALD
-------------------------
William M. Fitzgerald, President
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated on the 29th day of March, 1996.
Signatures Title
---------- -----
President (Principal Executive Officer) and
Director of John Hancock Realty Equities,
Inc. (Managing General Partner of
WILLIAM M. FITZGERALD Registrant)
---------------------
William M. Fitzgerald
Treasurer (Chief Accounting Officer)
of John Hancock Realty Equities, Inc.
RICHARD E. FRANK (Managing General Partner of Registrant)
---------------------
Richard E. Frank
Director of John Hancock Realty Equities,
Inc. (Managing General Partner of
MALCOLM G. PITTMAN Registrant)
---------------------
Malcolm G. Pittman, III
Director of John Hancock Realty Equities,
Inc. (Managing General Partner of
SUSAN M. SHEPHARD Registrant)
---------------------
Susan M. Shephard
32
<PAGE>
ANNUAL REPORT ON FORM 10-K
ITEM 8, ITEM 14 (a) (1) AND (2), (c) AND (d)
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
CERTAIN EXHIBITS
FINANCIAL STATEMENT SCHEDULES
YEAR ENDED DECEMBER 31, 1995
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
BOSTON, MASSACHUSETTS
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
(ITEMS 8 AND 14(a) (1) AND (2))
1. Financial Statements Page
Report of Independent Auditors F-3
Statement of Net Assets in Liquidation at
December 31, 1995 F-4
Balance Sheet at December 31, 1994 F-5
Statements of Operations for the Years Ended
December 31, 1995, 1994 and 1993 F-6
Statements of Partners' Equity for the Years Ended
December 31, 1995, 1994 and 1993 F-7
Statements of Cash Flows for the Years Ended
December 31, 1995, 1994 and 1993 F-8
Notes to Financial Statements F-10
2. Financial Statement Schedules:
Schedule III: Real
Estate and Accumulated Depreciation F-21
All other schedules for which provision is made in the applicable
accounting regulation of the Securities and Exchange Commission are not
required under the related instructions or are inapplicable and, therefore,
have been omitted.
F-2
<PAGE>
Report of Independent Auditors
To the Partners
John Hancock Properties Limited Partnership
We have audited the accompanying statement of net assets in liquidation of
John Hancock Properties Limited Partnership as of December 31, 1995, the
balance sheet as of December 31, 1994, and the related statements of
operations, partners' equity and cash flows for each of the three years in
the period ended December 31, 1995. Our audits also included the financial
statement schedule listed in the index at Item 14(a). These financial
statements and schedule are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements and schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the net assets in liquidation of John Hancock
Properties Limited Partnership as of December 31, 1995, its financial
position as of December 31, 1994, and the results of its operations and its
cash flows for each of the three years in the period ended December 31,
1995, in conformity with generally accepted accounting principles. Also,
in our opinion, the related financial statement schedule, when considered
in relation to the basic financial statements taken as a whole, presents
fairly, in all material respects, the information set forth therein.
ERNST & YOUNG LLP
February 9, 1996
F-3
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
STATEMENT OF NET ASSETS IN LIQUIDATION
December 31, 1995
Assets:
Cash and cash equivalents $1,814,023
Restricted cash 8,193,775
Note receivable, net of allowance of $284,155 -
Prepaid expenses and other assets 4,562
-----------
Total assets 10,012,360
Liabilities:
Accounts payable and accrued expenses 54,466
Accounts payable to affiliates 37,141
Mortgage note payable to affiliate 8,193,775
-----------
Total liabilities 8,285,382
-----------
Net assets $1,726,978
===========
See Notes to Financial Statements
F-4
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
BALANCE SHEET
December 31, 1994
ASSETS
Assets:
Cash and cash equivalents $578,996
Restricted cash 417,985
Note receivable, net of allowance of $284,155 -
Prepaid expenses and other assets 79,275
Investment in property:
Land 2,588,726
Buildings and improvements 18,205,348
-----------
20,794,074
Less: accumulated depreciation (6,821,682)
-----------
13,972,392
-----------
Total assets $15,048,648
===========
LIABILITIES AND PARTNERS' EQUITY
Liabilities:
Accounts payable and accrued expenses $318,178
Accounts payable to affiliates 268,538
Note payable to affiliate 1,000,000
Mortgage debt 13,416,019
-----------
Total liabilities 15,002,735
Partners' equity/(deficit):
General Partners' (707,996)
Limited Partners' 753,909
-----------
Total partners' equity 45,913
-----------
Total liabilities and partners' equity $15,048,648
===========
See Notes to Financial Statements
F-5
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
STATEMENTS OF OPERATIONS
Years Ended December 31,
1995 1994 1993
---- ---- ----
Income:
Rental income $2,234,057 $3,190,235 $3,037,508
Interest income 86,029 30,141 48,383
Gain on sale of properties 4,801,258 - -
---------- ---------- ----------
Total income 7,121,344 3,220,376 3,085,891
Expenses:
Interest 863,061 1,141,871 1,192,772
Property operating expenses 1,095,422 1,373,439 1,478,516
Depreciation 473,283 624,361 645,808
General and administrative 154,493 138,570 138,423
Provision for/(recovery of)
uncollectible note receivable - (13,903) 298,058
---------- ---------- ----------
Total expenses 2,586,259 3,264,338 3,753,577
---------- ---------- ----------
Net income/(loss) $4,535,085 ($43,962) ($667,686)
========== ========== ==========
Allocation of net income/(loss):
General Partners $707,996 ($440) ($6,677)
Limited Partners 3,827,089 (43,522) (661,009)
---------- ---------- ----------
$4,535,085 ($43,962) ($667,686)
========== ========== ==========
Net income/(loss) per Limited
Partnership Unit outstanding $174.32 ($1.98) ($30.11)
========== ========== ==========
See Notes to Financial Statements
F-6
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
STATEMENTS OF PARTNERS' EQUITY
Years Ended December 31, 1995, 1994 and 1993
General Limited
Partners Partners Total
-------- -------- -----
Partners' equity/(deficit) at
January 1, 1993 (21,954 Limited
Partnership Units outstanding) ($700,879) $1,458,440 $757,561
Less: Net loss (6,677) (661,009) (667,686)
-------- ---------- --------
Partners' equity/(deficit) at
December 31, 1993 (21,954 Limited
Partnership Units outstanding) (707,556) 797,431 89,875
Less: Net loss (440) (43,522) (43,962)
-------- ---------- ----------
Partners' equity/(deficit) at
December 31, 1994 (21,954 Limited
Partnership Units outstanding) (707,996) 753,909 45,913
Add: Net income 707,996 3,827,089 4,535,085
Less: Cash distribution - (2,854,020) (2,854,020)
-------- ---------- ----------
Partners' equity at December 31, 1995
(21,954 Limited Partnership Units
outstanding) $- $1,726,978 $1,726,978
======== ========== ==========
See Notes to Financial Statements
F-7
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Operating activities:
Net income/(loss) $4,535,085 ($43,962) ($667,686)
Adjustments to reconcile net loss
to net cash provided by
operating activities:
Depreciation 473,283 624,361 645,808
Provision for uncollectible note
receivable - - 298,058
Gain on sale of property (4,801,258) - -
---------- ---------- ----------
207,110 580,399 276,180
Changes in operating assets and liabilities:
Decrease in prepaid expenses,
other assets and receivables 74,713 8,064 22,255
Decrease in accounts payable
and accrued expenses (263,712) (7,270) (2,437)
Decrease/(increase) in restricted cash 417,985 34,446 (31,945)
Increase/(decrease) in accounts payable to
affiliates (231,397) (294,017) 41,969
---------- ---------- ----------
Net cash provided by
operating activities 204,699 321,622 306,022
Investing activities:
Proceeds from sale of property 13,696,656 - -
---------- ---------- ----------
Net cash provided by investing
activities 13,696,656 - -
---------- ---------- ----------
</TABLE>
Continued on Next Page
F-8
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
STATEMENTS OF CASH FLOWS (Continued)
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Financing activities:
Principal payments on note payable to affiliate (1,000,000) - -
Principal payments on mortgage note payable
to affiliate (500,000) - -
Principal payments on long-term debt (118,533) (186,647) (166,289)
Cash distributed to Partners (2,854,020) - -
---------- ---------- ----------
Net cash used in financing
activities (4,472,553) (186,647) (166,289)
---------- ---------- ----------
Net increase in cash and cash
equivilents 9,428,802 134,975 139,733
Cash and cash equivalents at
beginning of year 578,996 444,021 304,288
---------- ---------- ----------
Cash and cash equivalents at
end of year $10,007,798 $578,996 $444,021
=========== ========== ==========
Supplemental disclosure of non-cash items:
Purchase of mortgage note on the Fisherman's
Village Apartments by the Managing General
Partner $8,693,774 $- $-
Assumption of mortgage debt on Northgeen
Apartments by the Buyer $4,603,711 $- $-
</TABLE>
See Notes to Financial Statements
F-9
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
1. Organization of Partnership
---------------------------
John Hancock Properties Limited Partnership (the "Partnership") was
formed under the Massachusetts Uniform Limited Partnership Act on
May 17, 1984. As of December 31, 1995, the Partnership consisted of
a sole Managing General Partner, John Hancock Realty Equities, Inc.
(the "Managing General Partner"), an Associate General Partner, JH
Associates Limited Partnership (the "Associate General Partner"),
and 2,054 Limited Partners. The Managing General Partner and
Associate General Partner are collectively referred to as the
"General Partners" and the General Partners and the Limited Partners
are collectively referred to as the "Partners". The Managing
General Partner is the general partner of the Associate General
Partner and is a wholly-owned, indirect subsidiary of John Hancock
Mutual Life Insurance Company ("John Hancock"). The Partnership is
engaged solely in the acquisition, operation, and disposition of
investment real estate. The initial capital of the Partnership was
$6,000, representing capital contributions of $800 from the Managing
General Partner, $200 from the Associate General Partner and $5,000
from the initial Limited Partner (a former director of the Managing
General Partner). The Amended Agreement of Limited Partnership of
the Partnership (the "Partnership Agreement") authorized the
issuance of up to 35,000 Units of Limited Partnership Interests at
$1,000 per Unit. During the offering period, which terminated on
August 31, 1985, 21,954 Units of Limited Partnership Interests
("Units) were sold. There have been no changes in the number of
Units outstanding subsequent to the termination of the offering
period.
F-10
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
1. Organization of Partnership (continued)
---------------------------
The latest date on which the Partnership was due to terminate was
December 31, 2020, unless it was sooner terminated in accordance
with the terms of the Partnership Agreement. It was expected that
in the ordinary course of the Partnership's business, the properties
of the Partnership would be disposed of, and the Partnership
terminated, before December 31, 2020. As initially stated in its
Prospectus, the sale of the Partnership's last remaining property
was expected to occur within five to eight years following the date
such property was acquired by the Partnership. On December 29,
1995, the Partnership sold its last remaining property, the
Fisherman's Village Apartments, which resulted in the termination of
the Partnership's operations. On January 17, 1996, the Managing
General Partner distributed $658,620 to the Limited Partners from
the Partnership's net assets and established a reserve for
contingencies with the remaining balance of the Partnership's net
assets, as permitted by, and in accordance with, the terms of the
Partnership Agreement. The reserve for contingencies, in the amount
of approximately $1,060,000, will be used to fund any possible
liabilities that may arise. If all liabilities are resolved by the
end of 1996 and the Managing General Partner determines that funds
are available for distribution, the Managing General Partner expects
to make a final distribution of the Partnership's net assets, in
accordance with the terms of the Partnership Agreement, to the
Limited Partners by December 31, 1996. Such distribution, if any,
would result in the liquidation and termination of the Partnership.
As described in Note 2 below, on December 31, 1995, the Partnership
changed its basis of accounting from the going-concern basis to the
liquidation basis of accounting.
2. Significant Accounting Policies
-------------------------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenue and expenses during the reporting period. Actual results
may differ from those estimates.
On December 29, 1995, the Partnership sold its last remaining
property. As a result, the Partnership changed its basis of
accounting from the going-concern basis to the liquidation basis of
accounting as of December 31, 1995. Consequently, as of December
31, 1995, assets are stated at their estimated net realizable value
and liabilities reflect their estimated settlement amounts. The
financial statements for the period from January 1, 1995 to December
31, 1995 and for all periods prior to January 1, 1995 have been
prepared on a going-concern basis of accounting.
F-11
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
2. Significant Accounting Policies (continued)
-------------------------------
Cash equivalents are highly liquid investments with maturities of
three months or less when purchased. These investments are recorded
at cost plus accrued interest, which approximates market value.
Restricted cash represents funds restricted for tenant security
deposits, funds held in escrow and funds held to pay mortgage note
payable to affiliate.
Investments in property are recorded at cost less any property write-
downs for permanent impairment of values. Cost includes the initial
purchase price of the property plus the cost of significant
improvements, acquisition and legal fees, and other miscellaneous
acquisition costs.
Depreciation has been provided on a straight-line basis over the
estimated useful lives of the various assets: thirty years for the
buildings and five years for related improvements. Maintenance and
repairs are charged to operations as incurred.
The net income/(loss) per Unit for each year is computed by dividing
the Limited Partners' share of net income/(loss) by the number of
Units outstanding at the end of each year.
No provision for income taxes has been made in the Financial
Statements since such taxes are the responsibility of the individual
Partners rather than that of the Partnership.
3. The Partnership Agreement
-------------------------
Profits from the normal operations of the Partnership for each
fiscal year, or portion thereof, are allocated between the Limited
Partners and the General Partners in the same proportion as
Distributable Cash from Operations (as defined in the Partnership
Agreement) provided that (i) in no event shall the General Partners
be allocated less than 1% of any such profits from normal
operations, and (ii) if there is any fiscal year which produces no
Distributable Cash from Operations but which produces profits for
tax purposes from normal operations, such profits are allocated 90%
to the Limited Partners and 10% to the General Partners.
F-12
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
3. The Partnership Agreement (continued)
-------------------------
Losses from the normal operations of the Partnership for each fiscal
year or portion thereof are allocated 99% to the Limited Partners
and 1% to the General Partners, except any such profits or losses
which were based upon the Partnership's operations prior to the
initial closing under the Partnership's offering of Units were
allocated 99% to the General Partners and 1% to the initial Limited
Partner. Distributable Cash from Operations is distributed 90% to
the Limited Partners and 10% to the General Partners; provided,
however, that in each fiscal year the General Partners will defer
their receipt of any Distributable Cash from Operations to the
extent necessary to provide the Limited Partners with a
non-cumulative return in such year equal to 4% of their Invested
Capital (as defined in the Partnership Agreement). All
distributions of Distributable Cash from Operations deferred by the
General Partners accrue and are payable to them, to the extent
possible, out of subsequent years' Distributable Cash from
Operations remaining after the receipt by the Limited Partners of
the aforesaid 4% return, or out of cash from sales and refinancings
as specified below.
Cash from Sales or Refinancings (as defined in the Partnership
Agreement) is distributed to the Limited Partners until the Limited
Partners have received, first, a return of their total Invested
Capital, and, second, such additional amount as may be necessary,
after giving effect to all previous distributions of Distributable
Cash from Operations and of Cash from Sales or Refinancings to the
extent required to satisfy any deficiency in the Cumulative Return
on Investment (as defined in the Partnership Agreement) to produce
in the aggregate a Cumulative Return on Investment of 7% per annum
for all fiscal quarters commencing on or after January 1, 1986, and
ending prior to the date of such distribution. The General Partners
are then entitled to receive an amount of Cash from Sales or
Refinancings equal to any portion of the General Partners' share of
Distributable Cash from Operations which was previously deferred in
order to permit the payment to the Limited Partners of a
non-cumulative return in each year equal to 4% of their Invested
Capital. Any Cash from Sales or Refinancings remaining after the
Limited Partners have received a return of their total Invested
Capital plus the Cumulative Return on Investment of 7% per annum for
all fiscal quarters commencing on or after January 1, 1986, and
ended prior to the date of such distribution, and after the General
Partners have received an amount of such cash equal to any such
deferred payment of Distributable Cash from Operations, will be
distributed 85% to the Limited Partners and 15% to the General
Partners.
F-13
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
3. The Partnership Agreement (continued)
-------------------------
Cash from the Sale of the last of the Partnership's properties are
distributed in the same manner as Cash from Sales or Refinancings,
except that before any other distribution is made to the Partners,
each Partner shall first receive from such cash, an amount equal to
the then positive balance, if any, in such Partner's capital account
after crediting or charging to such account the profits or losses
for tax purposes from such sale. To the extent, if any, that a
Partner is entitled to receive a distribution of cash based upon a
positive balance in its capital account prior to such distribution,
such distribution will be credited against the amount of such cash
the Partner would have been entitled to receive based upon the
manner of distribution of Cash from Sales or Refinancings, as
specified in the previous paragraph.
Profits from Sales or Refinancings are generally allocated in the
same manner as cash from the transaction; however, in no event shall
the General Partners be allocated less than 1% of any such profits
from the transaction. Losses from Sales or Refinancings are
allocated 99% to the Limited Partners and 1% to the General
Partners. In connection with the sale of the last of the
Partnership's properties, and therefore the dissolution of the
Partnership, profits will be allocated to any Partners having a
deficit balance in their capital account in an amount equal to the
deficit balance. Any remaining profits will be allocated in the
same order as cash from the sale would be distributed.
4. Transactions with the General Partners and Affiliates
-----------------------------------------------------
Expenses incurred or paid by the General Partners or their
affiliates and to which the General Partners and their affiliates
are entitled to reimbursement from the Partnership, and interest on
borrowings from the Managing General Partner were as follows:
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Operating expenses $107,478 $79,420 $78,390
Interest on note payable to affiliate 35,417 80,416 80,000
Interest on mortgage note payable to affiliate 119,493 - -
-------- -------- --------
$262,388 $159,836 $158,390
======== ======== ========
</TABLE>
The expenses above are included in expenses on the Statements of
Operations.
F-14
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
4. Transactions with the General Partners and Affiliates (continued)
-----------------------------------------------------
Accounts payable to affiliates represents amounts due to the General
Partners and their affiliates for various services provided to the
Partnership.
Note payable to affiliate represented a short-term borrowing by the
Partnership in the principal amount of $1,000,000 from the Managing
General Partner initially made to the Partnership on December 1,
1988. Due to the cash flow constraints of the Partnership, the
Managing General Partner each year made a new short-term loan to the
Partnership for the outstanding principal amount of $1,000,000. The
most recent Note carried interest at a rate of 8.5% per annum.
During the second quarter of 1995, the Partnership utilized net
proceeds from the sale of the Northgreen Apartments to pay the
Managing General Partner the entire outstanding principal balance of
the Note in the amount of $1,000,000.
From 1991 through the second quarter of 1993, payments to the
Managing General Partner towards the reimbursement of general and
administrative expenses incurred by the Managing General Partner on
behalf of the Partnership and the payment of interest on the short-
term loans referred to above were deferred in order for the
Partnership to meet its working capital needs. The Managing General
Partner also made short-term advances to the Partnership in order to
cover operating expenses that could not be paid from the operating
cash flow of the Partnership. Since the third quarter of 1993, the
Partnership has no longer deferred the reimbursement of such
expenses. In addition, during the year ended December 31, 1994, the
Partnership paid $453,853 to the Managing General Partner as
reimbursement for the short-term advances and towards the then
outstanding balance of the deferred general and administrative
expenses and interest described above. During June 1995, the
Partnership utilized net proceeds from the sale of the Northgreen
Apartments, and approximately $83,000 of cash generated from the
Partnership's operations, to reimburse the Managing General Partner
for the entire outstanding balance of such deferred amounts
aggregating $126,834.
F-15
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
4. Transactions with the General Partners and Affiliates (continued)
-----------------------------------------------------
Mortgage note payable to affiliate represents a short-term borrowing
from the Managing General Partner. On November 1, 1995, the
mortgage note on the Fisherman's Village Apartments came due. At
that time, the Partnership did not have sufficient cash to pay the
outstanding principal balance of $8,693,774. The Managing General
Partner had pursued obtaining an extension on the mortgage loan from
the lender; however, the lender would only agree to a six month
extension at a cost of two percent of the outstanding principal
balance. After reviewing the terms of the lender's proposed
extension and other third party financing options, the Managing
General Partner determined that it was in the best interest of the
Partnership to have the Managing General Partner provide short-term
financing to the Partnership. Therefore, on November 1, 1995, the
Managing General Partner purchased the mortgage loan from the
existing lender for the amount of the outstanding principal balance,
or $8,693,774. In connection therewith, the Partnership made a
$500,000 lump sum cash payment towards the outstanding balance of
the mortgage loan and the mortgage loan was modified to i) reflect a
reduction in the outstanding balance of the mortgage loan as a
result of the lump-sum cash payment made by the Partnership to the
Managing General Partner; ii) extend the maturity date of the
mortgage to November 1, 1996; iii) allow for prepayment at any time;
and iv) adjust the interest rate on the loan to the base lending
rate charged by the First National Bank of Boston, or 8.75%, payable
monthly. (The Partnership Agreement provides that the Managing
General Partner may loan funds to the Partnership at an interest
rate up to 2% above the base rate of the First National Bank of
Boston.)
On January 3, 1996, the Partnership paid the outstanding mortgage
indebtedness held by the Managing General Partner with funds
provided by the sale of its last property, the Fisherman's Village
Apartments.
The Managing General Partner serves in a similar capacity for three
other affiliated real estate limited partnerships.
F-16
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
5. Investment in Property
----------------------
At December 31, 1994, investment in property at cost consisted of
residential real estate as follows:
Fisherman's Village Apartments $13,462,613
Northgreen Apartments 7,331,461
-----------
$20,794,074
===========
On June 1, 1995, the Partnership sold the Northgreen Apartments to a
non-affiliated buyer for a gross sales price of $9,200,000 and
received net sales proceeds of $8,923,560, after deductions for
commissions and selling expenses incurred in connection with the
sale of the property. This transaction resulted in a non-recurring
gain of $3,983,713, representing the difference between the net
sales price and the property's net book value of $4,939,847. The
Partnership received net cash proceeds of $4,319,849 from the sale,
representing the excess of the net sales proceeds over the
outstanding mortgage indebtedness on the property of $4,603,711,
which indebtedness was assumed by the buyer.
On December 29, 1995, the Partnership sold the Fisherman's Village
Apartments to a non-affiliated buyer for a gross sales price of
$9,800,000 and received net sales proceeds of $9,376,807, after
deductions for commissions, selling expenses and other costs
incurred in connection with the sale of the property. This
transaction resulted in a non-recurring gain of $817,545,
representing the difference between the net sales price and the
property's net book value of $8,559,262. The Partnership received
net cash proceeds of $1,183,033 from the sale, representing the
excess of the net sales proceeds over the outstanding mortgage
indebtedness on the property of $8,193,774, which indebtedness was
then held by the Managing General Partner.
F-17
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
6. Mortgage Debt
-------------
At December 31, 1994, mortgage debt consisted of the following:
Non-recourse first mortgage note
collateralized by Fisherman's Village
Apartments. The mortgage note was
due on November 1, 1995, at which time
the Managing General Partner purchased
the mortgage note from the lender. $8,781,178
Non-recourse first mortgage note
collateralized by the Northgreen
Apartments. On June 1, 1995,
the property was sold and the
mortgage indebtedness was
assumed by the buyer of the
property. 4,634,841
-----------
$13,416,019
===========
Interest paid for the three years ended December 31, 1995 was as
follows:
Year Amount
---- ------
1995 $708,151
1994 1,062,340
1993 1,172,433
F-18
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
7. Note Receivable
---------------
Effective August 9, 1987, the unconditional guaranty obligation
granted by the seller of the Waterford Apartments (the "Obligor") to
the Partnership for operating deficits (including debt service) was
extended until August 1, 1994. (The Waterford Apartments was
conveyed to the property's mortgagee by a deed-in-lieu of
foreclosure on August 9, 1991.) The outstanding balance due in the
amount of $258,950 was restructured as a 10.5% Promissory Note due
on or before August 1, 1994. In accordance with the terms of the
Promissory Note, monthly installments of interest only were payable
at a rate of 5.5% through July 31, 1990. Commencing on August 1,
1990 monthly payments in the amount of $2,781 to amortize the then
outstanding principal and deferred interest balance of $303,985 in
accordance with a 30-year amortization at a rate of 10.5% were
required. As of December 31, 1993, the Managing General Partner
believed, based on information obtained with respect to the
Obligor's financial condition, that it was probable that the
Partnership would be unable to collect all amounts due from the
Obligor in accordance with terms of the note. Accordingly, as of
December 31, 1993, the Partnership established a provision,
reflected in the accompanying Statement of Net Assets in Liquidation
and the accompanying Balance Sheet, against the then entire
outstanding balance of the note in the amount of $298,058. The
provision has since been reduced to $284,155 as a result of payments
received on the note during 1994.
In June 1994, the Obligor notified the Partnership that he would be
unable to continue to pay the minimum monthly payments on the note
and would be unable to pay the outstanding balance of the note upon
its maturity on August 1, 1994. As of December 31, 1995, and as of
the date hereof, the Obligor is in default on the Promissory Note
for failure to make the minimum required payments due since June 1,
1994 and for failure to pay the outstanding balance of the note,
which was due on August 1, 1994. Once the Obligor ceased making the
requisite payments on the note, the Managing General Partner issued
a default notice and demand for payment to the Obligor and filed a
complaint with the court demanding full payment of all amounts owing
under the note.
On December 7, 1994 the court granted the Partnership a summary
judgment in response to the complaint filed against the Obligor in
the amount of $305,489, which represents the balance of the note at
maturity plus accrued interest thereon from the maturity date of the
note through the date of the judgment. As of the date hereof, the
Partnership has not received payment from the Obligor, and the
Managing General Partner continues to pursue collection of the
judgment amount. There can be no assurance that the Partnership
will be able to recover all, or any, of the amounts due from the
Obligor.
F-19
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (Continued)
8. Federal Income Taxes
--------------------
A reconciliation of the net income/(loss) reported in the Statements
of Operations to the net income/(loss) reported for federal income
tax purposes is as follows:
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Net income/(loss) per Statements of Operations $4,535,085 ($43,962) ($667,686)
Add/(deduct): Excess tax gain over book gain
on disposition of assets 5,418,818 - -
Excess of tax depreciation
over book depreciation (227,964) (313,090) (274,953)
Provision for/(recovery of)
uncollectible note receivable - (13,903) 298,058
Other income (1,989) 9,666 -
Other expenses 101,413 127,078 153,415
---------- --------- ---------
Net income/(loss) for federal income tax
purposes $9,825,363 ($234,211) ($491,166)
========== ========= =========
</TABLE>
9. Subsequent Event
----------------
On January 3, 1996, the Partnership paid the outstanding mortgage
indebtedness held by the Managing General Partner with funds
provided by the sale of its last property, the Fisherman's Village
Apartments.
On January 17, 1996, the Partnership made a cash distribution from
its net assets in the amount of $658,620 to all Limited Partners of
record at December 31, 1995.
F-20
<PAGE>
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
SCHEDULE III
REAL ESTATE AND ACCUMULATED DEPRECIATION
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Investment in Real Estate:
Balance at beginning of year $20,794,074 $20,794,074 $20,794,074
Cost of real estate disposed (20,794,074) - -
----------- ----------- -----------
Balance at end of year $- $20,794,074 $20,794,074
=========== =========== ===========
Accumulated Depreciation:
Balance at beginning of year $6,821,682 $6,197,321 $5,551,513
Additions charged to costs and expenses 473,283 624,361 645,808
Disposal (7,294,965) - -
----------- ----------- -----------
Balance at end of year $- $6,821,682 $6,197,321
=========== =========== ===========
</TABLE>
F-21
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000746262
<NAME> JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 10,007,798
<SECURITIES> 0
<RECEIVABLES> 284,155
<ALLOWANCES> 284,155
<INVENTORY> 0
<CURRENT-ASSETS> 10,012,360
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 10,012,360
<CURRENT-LIABILITIES> 91,607
<BONDS> 8,193,775
0
0
<COMMON> 0
<OTHER-SE> 1,726,978
<TOTAL-LIABILITY-AND-EQUITY> 10,012,360
<SALES> 0
<TOTAL-REVENUES> 7,121,344
<CGS> 0
<TOTAL-COSTS> 1,095,422
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 863,061
<INCOME-PRETAX> 4,535,085
<INCOME-TAX> 0
<INCOME-CONTINUING> 4,535,085
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,535,085
<EPS-PRIMARY> 174.32
<EPS-DILUTED> 174.32
</TABLE>
