UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
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FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter ended September 30, 1996 Commission File Number 2-93980
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FJS PROPERTIES FUND I, L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3252067
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
264 Route 537 East
Colts Neck, New Jersey 07722
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (908) 542-9209
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 of 15(d) of the Securities and 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
Authorized 100,000 limited partnership interests of which 16,788 have been sold
as of November 11, 1996.
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FJS PROPERTIES FUND I, L.P.
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INDEX
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Part I: FINANCIAL INFORMATION
Item 1: Financial Statements
Balance Sheets as of September 30, 1996 [Unaudited]
and December 31, 1995 .................................... 1
Statements of Operations for the three months and nine months
ended September 30, 1996 and 1995 [Unaudited]............. 2
Statement of Partners' Capital for the nine months
ended September 30, 1996 [Unaudited]...................... 3
Statements of Cash Flows for the nine months ended
September 30, 1996 and 1995 [Unaudited]................... 4
Notes to Financial Statements [Unaudited]................. 5
Item 2: Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 6.....7
Part II: OTHER INFORMATION
Item 6: Exhibits and Reports on Form 8-K.......................... 8
Signature Page.................................................... 9
. . . . . . . .
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PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
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FJS PROPERTIES FUND I, L.P.
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BALANCE SHEETS
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September 30, December 31,
1 9 9 6 1 9 9 5
<S> <C> <C>
[Unaudited]
Assets:
Current Assets:
Cash and Cash Equivalents $ 496,110 $ 542,337
Cash - Escrow 419,717 188,468
Cash - Security Deposits 122,437 122,367
Other Current Assets 36,482 101,040
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Total Current Assets 1,074,746 954,212
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Property Investment:
Land 2,296,804 2,296,804
Buildings 6,569,125 6,569,125
Furniture, Fixtures and Building Improvements 1,737,885 1,727,549
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Totals - At Cost 10,603,814 10,593,478
Less: Accumulated Depreciation (4,199,584) (4,011,823)
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Property Investment - Net 6,404,230 6,581,655
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Other Assets 202,699 221,005
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Total Assets $7,681,675 $ 7,756,872
========== ===========
Liabilities and Partners' Capital:
Current Liabilities:
Accounts Payable $ 61,035 $ 63,561
Accounts Payable - Related Party 6,221 25,549
Accrued Interest 37,741 38,947
Other Accrued Expenses 166,740 8,409
Tenant Security Deposits 122,437 122,367
Mortgage Payable - Current Portion 62,402 58,019
Deferred Income - Current Portion 7,143 --
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Total Current Liabilities 463,719 316,852
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Long-Term Liability:
Mortgage Payable - Non-Current Portion 4,809,603 4,856,967
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Deferred Income 41,071 --
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Partners' Capital:
General Partner (1,212,186) (1,210,028)
Limited Partners 3,579,468 3,793,081
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Total Partners' Capital 2,367,282 2,583,053
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Total Liabilities and Partners' Capital $7,681,675 $ 7,756,872
========== ===========
See Accompanying Notes to Financial Statements.
1
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<TABLE>
FJS PROPERTIES FUND I, L.P.
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STATEMENTS OF OPERATIONS
[UNAUDITED]
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Three months ended Nine months ended
September 30, September 30,
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1 9 9 6 1 9 9 5 1 9 9 6 1 9 9 5
------- ------- ------- -------
<S> <C> <C> <C> <C>
Rental Income $ 464,244 $ 451,164 $ 1,397,556 $ 1,375,456
Cost of Rental Income 170,119 150,732 494,808 455,834
----------- ----------- ----------- -----------
Gross Profit 294,125 300,432 902,748 919,622
----------- ----------- ----------- -----------
Expenses:
Selling, General and Administrative
Expenses 215,463 158,796 541,607 445,734
Depreciation and Amortization 69,114 68,405 206,067 205,215
----------- ----------- ----------- -----------
Total Expenses 284,577 227,201 747,674 650,949
----------- ----------- ----------- -----------
Operating Income 9,548 73,231 155,074 268,673
----------- ----------- ----------- -----------
Other [Income] and Expenses:
Interest Income (6,089) (6,385) (17,420) (18,956)
Interest Expense 118,880 120,249 356,384 360,379
----------- ----------- ----------- -----------
Total Other Expenses - Net 112,791 113,864 338,964 341,423
----------- ----------- ----------- -----------
Net [Loss] $ (103,243)$ (40,633)$ (183,890)$ (72,750)
=========== =========== =========== ===========
[Loss] Per Limited Partnership Unit $ (6.09)$ (2.40)$ (10.84)$ (4.29)
=========== =========== =========== ===========
Distributions Per Limited
Partnership Unit $ -- $ 1.83 $ 1.88 $ 4.71
=========== =========== =========== ===========
Weighted Average Number of Limited
Partnership Units Outstanding 16,788 16,788 16,788 16,788
=========== =========== =========== ===========
See Accompanying Notes to Financial Statements.
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2
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FJS PROPERTIES FUND I, L.P.
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STATEMENT OF PARTNERS' CAPITAL
[UNAUDITED]
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Total
General Limited Partners'
Partner Partners Capital
<S> <C> <C> <C>
Partners' Capital - December 31, 1995 $(1,210,028) $3,793,081 $ 2,583,053
Net [Loss] for the nine months ended
September 30, 1996 (1,839) (182,051) (183,890)
Cash Distributions to Partners (319) (31,562) (31,881)
----------- ---------- -----------
Partners' Capital - September 30, 1996 $(1,212,186) $3,579,468 $ 2,367,282
=========== ========== ===========
See Accompanying Notes to Financial Statements.
3
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<TABLE>
FJS PROPERTIES FUND I, L.P.
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STATEMENTS OF CASH FLOWS
[UNAUDITED]
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Nine months ended
September 30,
1 9 9 6 1 9 9 5
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<S> <C> <C>
Operating Activities:
Net [Loss] $ (183,890) $ (72,750)
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Adjustments to Reconcile Net [Loss] to
Net Cash Provided by Operating Activities:
Depreciation 187,762 186,909
Amortization 18,306 18,306
Changes in Assets and Liabilities:
[Increase] Decrease in:
Escrow (231,250) (283,826)
Security Deposits (70) 2,687
Other Current Assets 64,558 93,046
Increase [Decrease] in:
Accounts Payable (2,525) (14,388)
Accrued Interest (1,206) (1,629)
Other Accrued Expenses 158,331 157,381
Accounts Payable - Related Party (19,328) (9,749)
Tenant Security Deposits 70 (2,687)
Deferred Income 48,214 (400)
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Total Adjustments 222,862 145,650
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Net Cash - Operating Activities 38,972 72,900
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Investing Activities:
Capital Expenditures (10,337) (2,687)
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Financing Activities:
Principal Payments on Mortgages (42,981) (39,003)
Distributions to Partners (31,881) (79,869)
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Net Cash - Financing Activities (74,862) (118,872)
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Net [Decrease] in Cash and Cash Equivalents (46,227) (48,659)
Cash and Cash Equivalents - Beginning of Periods 542,337 574,627
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Cash and Cash Equivalents - End of Periods $ 496,110 $ 525,968
========== ===========
</TABLE>
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest during the nine months ended September 30, 1996 and
1995 was $358,030 and $362,008, respectively.
For purposes of the statement of cash flows, the Company considers all highly
liquid debt instruments purchased with a maturity of three months or less to be
cash equivalents.
See Accompanying Notes to Financial Statements.
4
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FJS PROPERTIES FUND I, L.P.
NOTES TO FINANCIAL STATEMENTS
[UNAUDITED]
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[A] Significant Accounting Policies
Significant accounting policies of FJS Properties Fund I, L.P. are set forth in
the Partnership's Form 10-K for the year ended December 31, 1995, as filed with
the Securities and Exchange Commission.
[B] Basis of Reporting
The balance sheet as of September 30, 1996, the statements of operations for the
three and nine months ended September 30, 1996 and 1995, the statement of
partners' capital for the nine months ended September 30, 1996, and the
statements of cash flows for the nine months ended September 30, 1996 and 1995
have been prepared by the Partnership without audit. The accompanying unaudited
financial statements have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of the
managing partner, such statements include all adjustments [consisting only of
normal recurring items] which are considered necessary for a fair presentation
of the financial position of the Partnership at September 30, 1996, and the
results of its operations for the three and nine months then ended, and its cash
flows for the nine months then ended. It is suggested that these financial
statements be read in conjunction with Form S-11 filed with the Securities and
Exchange Commission on April 25, 1985 and with the financial statements and
notes contained in the Partnership's Form 10-K for the year ended December 31,
1995.
Certain reclassifications may have been made to the 1995 financial statements to
conform to classifications used in 1996.
5
<PAGE>
Item 2:
FJS PROPERTIES FUND I, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
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Liquidity and Capital Resources
As of the present date, the Partnership owns and operates one Property, the
Pavilion Apartments, and does not intend to acquire any other property.
Cash flow from Pavilion should be sufficient to permit the Partnership to make
the constant monthly payments due prior to maturity on the first mortgage and to
meet its monthly operating expenses. However, should there be a significant
decrease in Pavilion's occupancy or rental rates, there can be no assurance that
the Partnership would be able to obtain sufficient funds to make such payments.
Operations
The Partnership has operated the Pavilion Apartments, located in West Palm
Beach, Florida since January 1985.
The project operated with occupancies in the mid to upper 80% range during the
third quarter of 1996. As of November 8, 1996, there were 48 vacant apartments
of which 10 of the vacant apartments were rented for occupancy during November,
and 38 apartments were available for rent. Thus 85% of the apartments are
occupied and 88% are presently rented. With the excess of available apartments,
one free month's rental is currently being offered for 13 month leases on two
bedroom/two bathroom units. These units comprise the great majority of the
available apartments. Rental income for the three and nine month periods ending
September 30, of 1995 and 1996, increased slightly from $451,164 and $1,375,456
to $464,244 and $1,397,556 for the comparable periods. These increases were
attributable to the increased rental rates for apartments at the Pavilion, which
were offset to some extent by increases in the vacancy rate at the project
compared to the earlier year.
Cost of Rental Income, consisting mainly of real estate taxes, repairs and
maintenance and utilities increased for the three and nine month periods of 1995
and 1996, from $150,732 and $455,834 to $170,119 and $494,808 respectively.
These increases were primarily a result of expenditures made in connection with
the increased Replacements and Repairs and Maintenance which were completed at
the project during the period. These are discussed further below.
Selling, General and Administrative Expenses increased substantially from
$158,796 and $445,734 for the respective three and nine month periods of 1995 to
$215,463 and $541,607 for 1996. Expenses for 1996 reflected increased payroll
costs in connection with Repairs and Maintenance performed at the Pavilion
Apartment. In addition, accruals for professional fees reflect increased
accruals to more accurately reflect actual expenses which were paid for the 1995
fiscal year. Additional increases reflected the administrative services of the
General Partner in connection with the preparation of the quarterly Forms 10Q
for filing with the Securities and Exchange Commission as required by law. In
addition, increased management fees to the unaffiliated property manager for
supervision of the additional work at the Pavilion were reflected in these
periods.
6
<PAGE>
FJS PROPERTIES FUND I, L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
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Operations [Continued]
In 1996, a new laundry room contract was entered into with the operator of the
laundry equipment at the Pavilion Apartments. This contract provided that in
addition to the installation of new laundry equipment at the Project, and
regular recurring fees based on machine income, an initial lump sum payment of
$50,000 was paid to the Partnership. This sum is being amortized over the 7 year
term of the agreement, and the cash received was utilized for the Repairs and
Maintenance being performed at the property. To date, all buildings [except one]
have been repainted, the swimming pool was remarcited, approximately six
thousand dollars of roof work was completed involving reroofing of many of the
patio areas at the property, and the fencing has been replaced around both the
tennis courts and the pool. Identification signs on the buildings have been
replaced, as have all the dumpster enclosures on the project. To date
approximately $140,000 has been spent. Still to be completed is the painting of
the final building and the painting of the exterior unit doors on all the
buildings.
As a result of the increased Selling, General and Administrative Expenses,
Operating Income decreased significantly from $73,231 and $268,673 for the three
and nine month periods of 1995 to $9,548 and $155,074 for the comparable periods
of 1996.
Inflation
As of the present date, inflation has not had a major impact on the operations
of the Partnership.
7
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PART II - OTHER INFORMATION
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Item 6. Exhibits and Reports on Form 8-K
[a] Exhibits as required by Item 601 of Regulation S-K:
None Required
[b] Reports on Form 8-K:
None filed during the quarter for which this report is submitted
8
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SIGNATURES
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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.
FJS PROPERTIES FUND I, L.P.
Date: November 12, 1996 By:________________________________
Andrew C. Alson
[President and Chief Financial Officer]
FJS Properties, Inc.
General Partner
9
<PAGE>
SIGNATURES
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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.
FJS PROPERTIES FUND I, L.P.
Date: November 12, 1996 By: /s/ Andrew C. Alson
-------------------
Andrew C. Alson
[President and Chief Financial Officer]
FJS Properties, Inc.
General Partner
9
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-mos
<FISCAL-YEAR-END> dec-31-1996
<PERIOD-END> sep-30-1996
<CASH> 915,827
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,074,746
<PP&E> 10,603,814
<DEPRECIATION> 4,199,584
<TOTAL-ASSETS> 7,681,675
<CURRENT-LIABILITIES> 463,719
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,367,282
<TOTAL-LIABILITY-AND-EQUITY> 7,681,675
<SALES> 464,244
<TOTAL-REVENUES> 464,244
<CGS> 170,119
<TOTAL-COSTS> 284,577
<OTHER-EXPENSES> (6,089)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 118,880
<INCOME-PRETAX> (103,243)
<INCOME-TAX> 0
<INCOME-CONTINUING> (103,243)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (103,243)
<EPS-PRIMARY> (6.09)
<EPS-DILUTED> (6.09)
</TABLE>
