<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1995
Commission File Number 0-14308
Exact Name of Registrant as Specified in Its Charter: T. ROWE PRICE
REALTY INCOME FUND I, A NO-LOAD LIMITED PARTNERSHIP
State or Other Jurisdicition of Incorporation or Ogranization:
Maryland
I.R.S. Employer Identification No.: 52-1363144
Address of Principal Executive Offices: 100 East Pratt Street,
Baltimore, Maryland 21202
Registrant's Telephone Number, Including Area Code: 1-800-638-5660
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
<PAGE>
<PAGE>2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
The financial statements of T. Rowe Price Realty Income Fund I, A
No-Load Limited Partnership ("Partnership") are set forth in
Exhibit 19 hereto, which statements are incorporated by reference
herein.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Liquidity and Capital Resources and Results of Operations
The Partnership's liquidity and capital resources and its results
of operations are discussed in the Chairman's letter to partners
and Investment Advisor's Report on pages 1-4 of Exhibit 19 hereto,
the Partnership's Quarterly Report to Security-Holders, which
letter and Report are hereby incorporated by reference herein.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K:
(a) Exhibits.
19 - Quarterly Report Furnished to Security-Holders,
including Financial Statements of the Partnership.
27 - Financial Data Schedule
All other items are omitted because they are not applicable or the
answers are none.
<PAGE>
<PAGE>3
SIGNATURES
Pursuant to the requirements 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.
T. ROWE PRICE REALTY INCOME FUND I,
A NO-LOAD LIMITED PARTNERSHIP
By: T. Rowe Price Realty Income Fund I
Management, Inc., General Partner
Date: February 6, 1996 By: /s/Charles E. Vieth
Charles E. Vieth
Vice President
Date: February 14, 1996 By: /s/ Joseph P. Croteau
Joseph P. Croteau
Principal Financial Officer
of the Partnership
Date: February 14, 1996 By: /s/ Gary C. Younker
Gary C. Younker,
Principal Accounting Officer
of the Partnership
<PAGE>
PAGE 1
QUARTERLY REPORT
FOR THE PERIOD ENDED
DECEMBER 31, 1995
FELLOW PARTNERS:
Revenues were relatively flat in the Fund's first fiscal quarter
ended December 31, 1995, compared with last year. Expenses,
however, were up, so net income declined from the prior-year
period. The Montgomery office building in Gaithersburg, Maryland,
had the most significant negative effect, as expenses associated
with this property increased by $38,000 over last year and its
rental income was off by $72,000. Montgomery suffered due to a 17%
decline in average leased status as well as from new credit
problems. Occupancy improved toward quarter-end, as outlined in the
Advisor's Report, so we hope operations at the property will
continue to improve, albeit slowly.
Royal Biltmore, the Phoenix office property, and The Business
Park, an office/service complex in Gwinnett County, Georgia,
remained bright spots in the portfolio. Rental income at the former
property was up in this year's quarter because of higher overall
rental rates, and its expenses were slightly lower despite an
increase in its real estate tax assessment. As a result, Royal
Biltmore's contribution to net income was $35,000 above the 1995
first quarter level. Operations at The Business Park improved by an
identical amount, fueled primarily by an 8% increase in average
leased status compared with 1995.
Newport Center, another office/service holding which is in
Deerfield Beach, Florida, showed improvement in rental rates, but
the effect on the net income comparison was offset by modestly
higher real estate taxes and bad debt expense.
The decline in the Fund's cash position compared with the
first fiscal quarter of 1995 was related to the significantly
greater cash distributions declared in the fourth fiscal quarter
ended September 30 but paid in the quarter ended December 31.
Approximately $8.00 more per unit was distributed from sales
proceeds and $5.00 more from improved operations for the quarter
ended September 30, 1995, relative to the prior fiscal year. As we
announced in the annual report, we currently plan to distribute
$4.75 per quarter for the current fiscal year but will review this
rate periodically to see if operating conditions, dispositions,
and/or cash needs warrant a change.
Sincerely,
<PAGE>2
James S. Riepe
Chairman
February 12, 1996
INVESTMENT ADVISOR'S REPORT
"Phoenix Gears Up For Full Recovery As Markets Tighten" was the
headline of an article in the November 16, 1995, issue of
Commercial Property News. Although growth is slowing from its brisk
1994 pace, the Phoenix economy remains one of the fastest-growing
in the nation, led by gains in tourism, high-tech manufacturing,
and back office services. Job growth continues to outpace the
national rate supported by strong in-migration, affordable housing,
a skilled labor force, and a high quality of life. As a result,
Phoenix remains one of the most active real estate markets in the
U.S.
The strength of this economy has had a significant impact on
the real estate sectors, particularly office and industrial, in
which the Fund has investments. Because of the lack of construction
and continued absorption of existing space, the overall office
vacancy rate has dropped below 13%, and large blocks of contiguous
space are difficult to find. In the Camelback submarket where Royal
Biltmore is located, vacancy rates have dropped from 30% in 1990 to
below 12%. As demand has grown, rental rates at this property have
increased from $12.75 per foot in 1992 to $17.00 today.
The industrial market is also booming, with an overall vacancy
rate below 7%. Unlike the office market, however, rental rates have
increased to such an extent that new construction is starting to
take place. Van Buren has benefited from the tightening of the
market, with rental rates on new and renewal leases up around 10%
over the last two years.
In such an environment, we expect opportunistic investors who
have been prevalent in the office market will be replaced by
institutional buyers who are willing to pay more for longer- term,
even though unproven, upside potential.
Property Highlights
The leased status of the portfolio remained flat versus the prior
quarter, as the declines in occupancy at Airport Perimeter and
Newport Center were offset by gains at Montgomery and The Business
Park.
<PAGE>3
Real Estate Investments
Gross % Leased
Leasable
Area Prior Current
Property (Sq. Ft.) Quarter Quarter
________ ________ _______ _______
Airport Perimeter 121,000 80% 72%
Montgomery 116,300 67 70
Royal Biltmore 71,300 98 98
Springdale 144,000 100 100
The Business Park 157,200 92 96
Van Buren 173,900 92 92
Newport Center 62,400 93 90
Spring Creek 51,400 100 100
________ ___ ___
Fund Total 897,500 89% 89%
At Montgomery, two new leases totaling 4,700 square feet were
signed, bringing occupancy to 70%. At The Business Park, 10,000
square feet of new leases, including a 2,000 square-foot renewal,
more than offset 3,500 square feet of expirations to raise the
leased status of this property to 96%. A major tenant at Royal
Biltmore has expressed interest in expanding into the property's
one remaining vacancy. The proposed rent for this space would
represent a new high at this property since the market began to
recover, indicating to us that the market is continuing to
strengthen.
We have received several offers for the Spring Creek property
and are currently negotiating a sales contract with the purchaser
whose offer we consider most favorable. We will report on our
progress next quarter.
Market Highlights
The Fund's two properties located in Phoenix, Arizona, continue to
benefit from the improvement of the local economy. The desire to
locate a business's offices near executive housing has also put
considerable upward pressure on rental rates and lowered vacancy
levels in the Camelback Corridor where Royal Biltmore is located.
Interest in Van Buren's vacant space remains high, as business
opportunities for small to medium-sized industrial space users
abound in the area. Rental rates for industrial properties have
increased enough to justify new construction, and there is plenty
of land available to accommodate it. This may affect rates and
occupancy at Van Buren by the end of 1996.
<PAGE>4
Investor interest in both of these properties is high, and
several potential buyers have made unsolicited inquiries about
their availability. Hundreds of industrial and office properties in
this market have been acquired over the last several years,
and values have appreciated. As a result, we are reviewing the pros
and cons of selling Royal Biltmore and Van Buren in 1996 and will
let you know the results of our deliberations.
LaSalle Advisors
February 12, 1996
CONDENSED BALANCE SHEETS
Unaudited
(In thousands)
December 31, September 30,
1995 1995
__________ ___________
Assets
Real Estate Property Investments
Land . . . . . . . . . . . . . . . . . $ 11,014 $ 11,014
Buildings and Improvements . . . . . . 54,433 54,237
________ ________
65,447 65,251
Less: Accumulated Depreciation
and Amortization . . . . . . . . . . . (24,708) (24,092)
________ ________
40,739 41,159
Properties Held for Sale . . . . . . . 1,226 1,226
________ ________
41,965 42,385
Cash and Cash Equivalents . . . . . . . . 1,487 2,832
Accounts Receivable
(less allowances of $124 and $85) . . . . 455 292
Other Assets. . . . . . . . . . . . . . . 543 624
________ ________
$ 44,450 $ 46,133
________ ________
________ ________
Liabilities and Partners' Capital
Security Deposits and Prepaid Rents . . . $ 363 $ 364
Accrued Real Estate Taxes . . . . . . . . 133 202
Accounts Payable and
Other Accrued Expenses. . . . . . . . . . 286 281
________ ________
Total Liabilities . . . . . . . . . . . . 782 847
Partners' Capital . . . . . . . . . . . . 43,668 45,286
________ ________
$ 44,450 $ 46,133
________ ________
________ ________
<PAGE>5
The accompanying notes are an integral part of the condensed
financial statements.
CONDENSED STATEMENTS OF OPERATIONS
Unaudited
(In thousands except per-unit amounts)
Three Months Ended
December 31,
1995 1994
___________ __________
Revenues
Rental Income . . . . . . . . . . . . . . $ 1,480 $ 1,483
Interest Income . . . . . . . . . . . . . 22 23
________ ________
1,502 1,506
________ ________
Expenses
Property Operating Expenses . . . . . . . 451 447
Real Estate Taxes . . . . . . . . . . . . 174 155
Depreciation and Amortization . . . . . . 616 600
Partnership Management Expenses . . . . . 123 111
________ ________
1,364 1,313
________ ________
Net Income. . . . . . . . . . . . . . . . 138 193
________ ________
________ ________
Activity per Limited Partnership Unit
Net Income. . . . . . . . . . . . . . . . $ 1.37 $ 1.92
________ ________
________ ________
Cash Distributions Declared . . . . . . . $ 4.75 $ 4.00
________ ________
________ ________
Units Outstanding . . . . . . . . . . . . 90,622 90,622
________ ________
________ ________
The accompanying notes are an integral part of the condensed
financial statements.
<PAGE>6
CONDENSED STATEMENT OF PARTNERS' CAPITAL
Unaudited
(In thousands)
General Limited
Partner Partners Total
________ ________ ________
Balance, September 30, 1995 . . . $ (3,747) $ 49,033 $ 45,286
Net Income. . . . . . . . . . . . 14 124 138
Cash Distributions. . . . . . . . (125) (1,631) (1,756)
_______ _______ _______
Balance, December 31, 1995. . . . $(3,858) $47,526 $43,668
_______ _______ _______
_______ _______ _______
The accompanying notes are an integral part of the condensed
financial statements.
CONDENSED STATEMENTS OF CASH FLOWS
Unaudited
(In thousands)
Three Months Ended
December 31,
1995 1994
________ ________
Cash Flows from Operating Activities
Net Income. . . . . . . . . . . . . . . . $ 138 $ 193
Adjustments to Reconcile Net Income
to Net Cash
Provided by Operating Activities
Depreciation and Amortization. . . . . 616 600
Increase in Accounts Receivable,
Net of Allowances. . . . . . . . . . . (163) (42)
Change in Other Assets . . . . . . . . 81 61
Decrease in Accrued
Real Estate Taxes. . . . . . . . . . . (69) (155)
Other Changes in Assets
and Liabilities. . . . . . . . . . . . 4 (51)
________ ________
Net Cash Provided by
Operating Activities. . . . . . . . . . . 607 606
Cash Flows Used in Investing Activities
Investments in Real Estate. . . . . . . . (196) (346)
Cash Flows Used in Financing Activities
Cash Distributions. . . . . . . . . . . . (1,756) (497)
________ ________
<PAGE>7
Cash and Cash Equivalents
Net Decrease during Period. . . . . . . . (1,345) (237)
At Beginning of Year. . . . . . . . . . . 2,832 2,603
________ ________
At End of Period. . . . . . . . . . . . . $ 1,487 $ 2,366
________ ________
________ ________
The accompanying notes are an integral part of the condensed
financial statements.
NOTES TO CONDENSED FINANCIAL STATEMENTS
Unaudited
The unaudited interim condensed financial statements reflect all
adjustments which are, in the opinion of management, necessary for
a fair statement of the results for the interim periods presented.
All such adjustments are of a normal, recurring nature.
The unaudited interim financial information contained in the
accompanying condensed financial statements should be read in
conjunction with the financial statements contained in the fiscal
1995 Annual Report to Partners.
NOTE 1 - TRANSACTIONS WITH RELATED PARTIES AND OTHER
As compensation for services rendered in managing the affairs of
the Partnership, the General Partner receives 10% of cash available
for distribution from operations and a portion of the proceeds from
property dispositions. The General Partner's share of cash
available for distribution from operations totaled $48,000 for the
first three months of fiscal 1996.
In accordance with the partnership agreement, certain
operating expenses are reimbursable to the General Partner. The
General Partner's reimbursement of such expenses totaled $37,000
for communications and administrative services performed on behalf
of the Partnership during the first three months of fiscal 1996.
An affiliate of the General Partner earned a normal and
customary fee of $2,000 from the money market mutual funds in which
the Partnership made its interim cash investments during the first
three months of fiscal 1996.
LaSalle Advisors Limited Partnership ("LaSalle") is the
Partnership's advisor and is compensated for its advisory services
directly by the General Partner. LaSalle is reimbursed by the
Partnership for certain operating expenses pursuant to its contract
with the Partnership to provide real estate advisory, accounting,
and other related services to the Partnership. LaSalle's
<PAGE>8
reimbursement for such expenses during the first three months of
fiscal 1996 totaled $38,000.
The partnership agreement includes provisions limiting the
maximum contribution the General Partner can be required to fund
upon the dissolution and termination of the Partnership if, at that
time, the General Partner's capital account has a negative balance.
The maximum contribution is approximately $913,000. If after making
such a contribution, the General Partner's capital account still
has a negative balance, a reallocation of income equal to the
remaining negative balance will be made to the General Partner from
the Limited Partners.
NOTE 2 - SUBSEQUENT EVENT
The Partnership declared a quarterly cash distribution of $4.75 per
unit to Limited Partners of the Partnership as of the close of
business on December 31, 1995. The distribution totals $478,000 and
represents $4.75 per unit of cash available for distribution from
operations for the period October 1, 1995 through December 31,
1995. The Limited Partners will receive $430,000, and the General
Partner will receive $48,000.
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
the
financial statements of T. Rowe Price Realty Income Fund I, A
No-Load Limited
Partnership included in the accompanying Form 10-K Report for the
year ended
September 30, 1995 and is qualified in its entirety by reference to
such
financial statements.
</LEGEND>
<CIK> 0000752743
<NAME> T. ROWE PRICE REALTY INCOME FUND I, A NO-LOAD LIMITED PARTNE
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-01-1994
<PERIOD-END> SEP-30-1995
<CASH> 2,832,000
<SECURITIES> 0
<RECEIVABLES> 377,000
<ALLOWANCES> 85,000
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 66,477,000
<DEPRECIATION> 24,092,000
<TOTAL-ASSETS> 46,133,000
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 45,286,000<F2>
<TOTAL-LIABILITY-AND-EQUITY> 46,133,000
<SALES> 0
<TOTAL-REVENUES> 6,043,000
<CGS> 0
<TOTAL-COSTS> 6,015,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 20,000
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 8,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 8,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,000
<EPS-PRIMARY> 0<F3>
<EPS-DILUTED> 0
<FN>
<F1>Not contained in registrant's unclassified balance sheet.
<F2>Partners' Capital.
<F3>Not applicable. Net income per limited partnership unit is
$.08.
</FN>
<PAGE>
