FORM 10-K
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
|X| ANNUAL REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the fiscal year ended December 31,
1996
|_| TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the transition period from _______to _________.
Commission File number 0-15755
FJS PROPERTIES FUND I, L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3252067
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
264 Route 537 East, Colts Neck, NJ 07722 (Address of principal
executive offices) (Zip Code)
Registrant's telephone number, including area code 908-542-9209
Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of each class Name of each exchange on which
registered
NONE N/A
Securities registered pursuant to Section 12(g) of the Exchange Act:
Units of Limited Partnership Interest
(Title of Class)
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 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
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of a specified date within the past 60
days. N/A [No public market exists]
Documents Incorporated by Reference
Prospectus of Registrant, dated June 10, 1985, as supplemented by
Supplement dated November 7, 1985, filed pursuant to Rule 424 under the
Securities Act of 1933. Annual Report on Form 10-K of Registrant for the fiscal
years ended December 31, 1986 through Decembef 31, 1995, filed pursuant to
section 13 or 15(d) of the Securities Exchange Act of 1934, but each only to the
extent expressly incorporated by reference in Parts I, II and III.
<PAGE>
PART I
Item 1. Business
Registrant is a Delaware limited partnership formed as of October 5,
1984. FJS Properties, Inc., a Delaware corporation and an affiliate of First
Jersey Securities, Inc. ("First Jersey" or the "Underwriter"), is the general
partner ("General Partner") of the Registrant.
Reference is made to the Prospectus (the "Prospectus") of Registrant
dated June 10, 1985, as supplemented by a Supplement (the "Supplement"), dated
November 7, 1985, which have been filed pursuant to rule 424 under the
Securities Act of 1933, as amended, each of which is incorporated herein by
reference. The Prospectus was filed as part of Registrant's Registration
Statement on Form S-11, pursuant to which 100,000 Units of Limited Partnership
Interest (the "Units") were registered. On May 1, 1986, the sole closing of the
Units, the Registrant received $8,391,500 in Gross Proceeds from the sale of
16,783 Units to investors. Registrant paid $671,320 in underwriting commissions
to First Jersey and a total of $419,575 in organization and offering expenses to
the General Partner.
Registrant owns and operates one 312 unit garden apartment complex,
the Pavilion Apartments ("Pavilion"), located in West Palm Beach, Florida. The
description of the acquisition is set forth in the Prospectus under "Property
Acquisitions" and is incorporated herein by reference. Registrant will not
invest in or acquire any other properties.
For the years ended December 31, 1996, 1995 and 1994, revenues from
Pavilion accounted for approximately 98.5%, 98.6% and 99.1% respectively of
Registrant's gross revenues.
Competition
The real estate business is highly competitive and Pavilion has
active competition from similar properties in the vicinity. Registrant will also
experience competition for potential buyers at such time as it seeks to sell
Pavilion.
Employees
Services are performed by Registrant's employees at Pavilion by nine
full-time and one part time on site personnel. The personnel are under the
direct supervision of a local unaffiliated management company which in turn is
supervised by the General Partner. Salaries for such on-site personnel are paid
by Registrant or by the local unaffiliated management company from fees received
from Registrant. The General Partner also provides certain supervisory property
management services to Registrant under a management agreement.
Tax Legislation
The Tax Reform Act of 1986 (the "1986 Act"), which was enacted on
October 22, 1986, requires that losses from "passive activities" (which includes
any rental activity) may only offset income from "passive activities" Passive
losses in excess of passive income are suspended and are carried over to future
years when they may be deducted against passive income generated by the
Partnership in such year (including gain recognized on the sale of the
Partnership's assets) or against passive income derived by Unitholders from
other sources.
The Revenue Act of 1987 (the "1987 Act") was enacted on December 22,
1987 and provides certain adverse tax consequences for "publicly traded
partnerships." A "publicly traded partnership" is defined as a partnership whose
interests are traded on an established securities market or readily tradable on
a secondary market (or the substantial equivalent thereof). Such a partnership
will be taxed as a corporation (unless at least 90% of its gross income is
derived from certain passive sources, such as real property rents, dividends or
interest) and each tax-exempt entity acquiring an interest in any such
partnership after December 17, 1987 will have all of its share of the
partnership's income attributable to interests acquired after such date treated
as unrelated business income. In addition, the income from such a partnership
would be treated as other than passive income, and losses from any such
partnership could only be offset by income from the same partnership.
The Revenue Act of 1987 adopted provisions which have an adverse
impact on investors in a "publicly traded partnership." A "publicly traded
partnership" is a partnership whose interests are traded on an established
securities market or readily tradable on a secondary market (or the substantial
equivalent thereof). If the Partnership were classified as such, (i) it may be
taxed as a corporation, (ii) qualified plans and other entities exempt from
taxation acquiring interests in the Partnership after December 17, 1987 would
have to treat income derived from the Partnership as unrelated business income,
with the result that the limited partnership interests would be less attractive
to tax-exempt investors (and therefore could be less marketable) or (iii) income
derived from an investment in the Partnership would be treated as other than
passive income, in which case losses from the Partnership could only be offset
by income from the same partnership. The IRS has established alternative safe
harbors that allow interests in a partnership to be transferred or redeemed in
certain circumstances without causing the partnership to be characterized a
"publicly traded partnership." Interests in the Partnership are not listed or
quoted for trading on an established securities exchange. However, it is
possible that transfers of interests could occur in a secondary market in
sufficient amount and frequency to cause the Partnership to be treated as a
"publicly traded partnership." The Partnership has adopted a policy of
prohibiting transfers in secondary market transactions unless, notwithstanding
such transfers, the Partnership will satisfy at least one of the safe harbors.
Such a restriction could impair the ability of an investor to liquidate its
investment quickly. It is anticipated that such policy will remain in effect
until such time, if ever, as further clarification of the Revenue Act of 1987
permits the Partnership to lessen the scope of these restrictions. The General
Partner, if so authorized, will take such steps as are necessary, if any, to
prevent the reclassification of the Partnership as a "publicly traded
partnership."
Item 2. Properties
The sole property owned and operated by Registrant is the Pavilion
Apartments (the "Project"), a 312 Unit garden apartment complex located at 401
Executive Center Drive, West Palm Beach, Florida. Registrant will not acquire or
invest in any other properties. Registrant acquired a 50% interest in the
Pavilion on December 31, 1984, and the remaining 50% on January 1, 1985. It owns
Pavilion in fee ownership, subject to a first mortgage.
Pavilion, constructed in 1972, is located on a 15 acre tract and
consists of 312 apartment units containing 286,500 square feet of rentable area
in 11 low-rise buildings. Rental units are available in one, two and three
bedroom plans. There are 108 one-bedroom apartments, 44 two- bedroom apartments
with one bath, 116 two-bedroom apartments with two baths, and 44 three-bedroom
apartments. Ground amenities include a heated swimming pool, lighted tennis
courts, basketball and shuffle-board courts, and a clubhouse with game room,
saunas, lounge and outdoor barbecues. An equipped children's playground is also
provided.
The apartments in the Project are available for rent to residential
tenants, generally under one year leases. No tenant occupies more than one
apartment in the Pavilion except for the West Palm Beach Recovery Center which
occupies 8 Units. Each of such units was leased at the then current market
rents. With substantially all tenants occupying their apartments under one year
leases, it is anticipated that leases for all apartments will expire each year.
The current rent schedule for leases is as follows:
- -------------------------------
Unit Size1 Monthly Rent2
- -------------------------------
- -------------------------------
1 BR/1B $499/$529
- -------------------------------
- -------------------------------
2 BR/1B $589/$619
- -------------------------------
- -------------------------------
2 BR/2B $599/$629
- -------------------------------
- -------------------------------
3 BR/2B $729/$759
- -------------------------------
In the opinion of the management of Registrant, the Project is
adequately covered by insurance.
First Mortgage: The existing first mortgage affecting the Project is held
of record by Greenwich Capital Financial Products, Inc., and serviced by Bank
United of Texas FSB, Houston, Texas. As of December 31, 1996, the mortgage had
an unpaid principal balance of approximately $4,856,968. This mortgage was
closed on March 31, 1994, and refinanced the former first mortgage held by The
Bank of Tokyo. At that time, a new loan secured by a first mortgage on the
project was obtained from the Long Beach Bank, FSB, Orange, California, in the
amount of $5,000,000. This loan provides for a term of ten (10) years with an
interest rate of 9.75% per annum. The loan is repayable in equal monthly
installments of $44,556.87 for principal and interest, with a balloon payment
due in March 2004. At maturity a balance of approximately $4,215,000 will be
due. The loan requires deposits with the lender for real estate taxes, insurance
premiums, a debt service reserve of one month's payment, as well as deposits for
replacement reserves for the project. These deposits are held in interest
bearing accounts for the benefit of Registrant.
The following table sets forth the components of the Pavilion
Apartments upon which depreciation, for Federal Tax purposes, is taken:
- -----------------------------------------------------------------------
Item Tax Basis Rate Method Life
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Building $6,897,424 5% ACRS 18 yrs
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Improvements $71,843 10% SL 10 yrs
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Improvements $192,596 3.6% MACRS 27.5 yrs
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Improvements $456,955 Fully SL 10 yrs
Depreciated
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Furniture/Fixtures $1,048,378 Fully ACRS 5 yrs
Depreciated
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Furniture/Fixtures $22,727 Various MACRS 7 yrs
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Furniture/Fixtures $5,149 Fully MACRS 7 yrs
Depreciated
- -----------------------------------------------------------------------
Ad Valorem Real Estate taxes for the 1996 calendar year were in the
amount of $199,978.78, which was based upon an assessed valuation of $7,659,000
and the following millage rates:
- -------------------------------------------
Taxing Authority: Millage
rate:
- -------------------------------------------
- -------------------------------------------
County 4.2358
- -------------------------------------------
- -------------------------------------------
School State 6.6090
- -------------------------------------------
- -------------------------------------------
School Local 2.6430
- -------------------------------------------
- -------------------------------------------
City of West Palm Beach 8.8747
- -------------------------------------------
- -------------------------------------------
So Fl Water Management Dist. 0.5720
- -------------------------------------------
- -------------------------------------------
Children's Services Council 0.3756
- -------------------------------------------
- -------------------------------------------
F.I.N.D. 0.0380
- -------------------------------------------
- -------------------------------------------
PBC Health Care District 1.2000
- -------------------------------------------
- -------------------------------------------
Everglades Construction 0.1000
Project
- -------------------------------------------
- -------------------------------------------
County - Debt 0.2833
- -------------------------------------------
- -------------------------------------------
School - Debt 0.5360
- -------------------------------------------
- -------------------------------------------
City of West Palm Beach - 0.6429
Debt
- -------------------------------------------
- -------------------------------------------
Total: 26.1103
- -------------------------------------------
In addition a non-advalorem assessment of $16,432.74 was levied by
the Solid Waste Authority against the Pavilion. The aggregate tax of $216,411.52
was paid in the discounted amount of $207,755.06 in November 1996.
Item 3. Legal Proceedings
There are no material legal proceedings pending against or involving
Registrant or Pavilion.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the
1996 calendar year.
PART II
Item 5. Market for Registrant's Securities and Related Security Holder
Matters
Units of the Registrant are not publicly traded nor is it
anticipated that a public trading market will develop for the Units. As of March
15, 1997, there were approximately 768 holders owning an aggregate of 16,788
Units. The General Partner has established a policy of limiting transfers of
Units in secondary market transactions unless, notwithstanding such transfers,
the Partnership will satisfy one or more applicable safe harbors prescribed by
the Internal Revenue Service to avoid having the Partnership classified as a
publicly traded partnership which could have adverse tax effects on limited
partners. In order to comply with the safe harbor provisions, the transfer of
Units may be restricted.
There were no distributions per Unit of Registrant during the 1985
fiscal year. The Registrant distributed $3.01 per Unit for the 1986 fiscal year,
$4.63 per Unit for 1987, $6.59 per Unit for 1988, $14.72 per Unit for 1989,
$7.75 per Unit for 1990, and $1.97 per Unit for the first quarter of 1991. There
were no distributions made for the second, third or fourth quarters of 1991, for
1992, or for 1993. Distributions aggregating $5.19 and $5.64 per Unit were
distributed for 1994 and 1995 respectively, and a distribution of $1.54 was made
for the first quarter of 1996. No distributions were made for the remaining
quarters of 1996, during which period all available cash flow was utilized for
work being done on the Pavilion Apartments.
There are no material legal restrictions set forth in Registrant's
Limited Partnership Agreement, annexed to the Prospectus as Exhibit A thereto
("Partnership Agreement"), upon Registrant's
present or future ability to make distributions.
Item 6. Selected Financial Information
The information set forth below presents selected financial data of
Registrant. Additional financial information is set forth in the audited
financial statements and footnotes contained herein.
Years Ended
December 31,
1996 1995 1994 1993 1992
---- ---- ---- ---- ----
Total assests $7,448,953 $7,756,871 $8,022,290 $7,976,563 $8,238,335
Mortage note payable 4,856,968 $4,914,986 $4,967,636 $4,648,456 $4,876,058
Revenue $1,852,877$1,841,892 $1,817,308 $1,724,052 $1,552,137
Interest expense $476,199 $481,611 $438,481 $335,989 $509,988
Net(loss) ($270,996) ($121,682) ($241,357) $8,756 ($308,074)
Net cash provided by
operating activities $51,495 $116,822 $30,55 $368,766 $73,437
Net cash used in
investing activities
capital expenditure ($10,336) ($2,687) ($45,228) ($18,139) ($5,689)
Net cash used in
finaning activities ($89,899) (146,425) ($9,026) ($240,102) ($45,542)
(Loss) per limited
partnership unit ($15.98) ($7.18) ($14.23) ($0.52) ($18.17)
Distributions per
limited partnership unit $1.88 $5.53 $4.96ip -- -- -- --
Weighed averag number
of limited partnerships
units outstanding 16,788 16,788 16,788 16,788 16,788
<PAGE>
Item 7. Management's Discussion and Analysis of Financial Conditions
and Results of Operations
Liquidity and Capital Resources
As of the present date, Registrant owns one Property, the Pavilion
Apartments, and does not intend to acquire any other property.
As of May 1, 1986, Registrant admitted as Limited Partners
purchasers of 16,783 Units. Total capital raised was $8,391,500. In addition,
Registrant received accrued interest on the escrow account in the amount of
$82,471. Thus proceeds from the admission of Limited Partners aggregated
$8,473,971.
The Pavilion Apartments are owned by Registrant subject to a first
mortgage loan in the original principal amount of $5,000,000. This loan was
obtained from Long Beach Bank in March 1994, to refinance the previous first
mortgage affecting the property. (See "First Mortgage" above for a description
of the terms of this loan).
Registrant anticipates that cash flow from Pavilion should be
sufficient to permit the Partnership to make the monthly payments on the first
mortgage due prior to maturity and to meet Registrant's monthly operating
expenses, however, should there be a significant decrease in Pavilion's
occupancy or rental rates, there can be no assurance that Registrant would be
able to obtain sufficient funds to make such payments.
Registrant distributed $3.01 per Unit for the 1986 fiscal year,
$4.63 per Unit for 1987, $6.59 per Unit for 1988, $14.72 per Unit for 1989,
$7.75 per Unit for 1990, and $1.97 per Unit for the first quarter of 1991. There
were no distributions made for the second, third or fourth quarters of 1991, for
1992, or for 1993. Distributions aggregating $5.19 and $5.64 per Unit were made
for 1994 and 1995 respectively, and a distribution of $1.54 was made for the
first quarter of 1996. No distributions were made for the remaining quarters of
1996. The reduction in distributions in the years from 1989 through 1991,
resulted from decreasing interest rates and the reduced occupancy levels which
the Pavilion Apartments experienced. When there was cash flow available for
distribution during 1992 and 1993, no distributions were made to retain
available cash which might be required for use in connection with the
refinancing of the existing first mortgage. During the last three quarters of
1996 all available cash flow was utilized for work being done on the Pavilion
Apartments. (See "Operations - 1996 Fiscal Year" below).
OPERATIONS
Registrant has operated the Pavilion Apartments, located in West
Palm Beach, Florida, since January 1985.
Management Agreement
The Pavilion Apartments are currently managed by M.L. Property
Management Inc., an unaffiliated property manager, under a five year agreement
which commenced in December 1993. The agreement will also terminate on the
earlier sale or disposition of the Pavilion Apartments.
1996 Fiscal Year
Rental Income for the year ended December 31, 1996, was $1,852,877
as compared with $1,841,892 for the 1995 calendar year. The increase in income
in 1996 reflected slightly increased rental rates for apartments at the project.
These increases were offset to some extent by greater vacancies at the property.
Rental allowances, utilized to attracted tenants to the Pavilion were reduced
slightly during 1996. Occupancy rates at the project held in the high 80% to the
low 90% range for the 1996 year. As of March 12, 1996, the Pavilion Apartments
had 7 apartments out of 312 available for rent. These 7 apartments represent 4
of 20 presently vacant apartments and 4 of an additional 9 apartments where the
tenants have given notice of their intent to vacate. Seventeen of the vacant
apartments and five of the apartments scheduled to become vacant have already
been rented. In addition one tenant in one apartment is under an eviction
notice, and this apartment has already been rented for occupancy upon gaining
possession. The 20 apartments presently vacant equates to a physical occupancy
of 93.6%.
Cost of Rental Income, consisting mainly of real estate taxes,
repairs and maintenance and utilities, increased in 1996 to $749,911 as compared
to the 1995 cost of $615,759. This increase resulted primarily from a
significant amount of work done to improve the overall rentability and curb
appeal of the Pavilion. The following is a summary of some of the extraordinary
items and associated costs completed in 1996.
- -----------------------------------------------
Repainting including cleaning and $72,320
caulking of all buildings
- -----------------------------------------------
- -----------------------------------------------
Pool remarcite $7,143
- -----------------------------------------------
- -----------------------------------------------
Re-roof patios $11,850
- -----------------------------------------------
- -----------------------------------------------
Gutter replacement $478
- -----------------------------------------------
- -----------------------------------------------
Clubhouse - Cabinet replacement $900
- -----------------------------------------------
- -----------------------------------------------
Clubhouse - Window replacement $3,761
- -----------------------------------------------
- -----------------------------------------------
Clubhouse - bath window replacement $628
- -----------------------------------------------
- -----------------------------------------------
Replace dumpster enclosures $4,475
- -----------------------------------------------
- -----------------------------------------------
Replace fencing - pool and tennis $4,238
court
- -----------------------------------------------
- -----------------------------------------------
Replace project signage $2,209
- -----------------------------------------------
- -----------------------------------------------
Total: $108,002
- -----------------------------------------------
Selling, General and Administrative Expenses for 1996 increased to
$645,114 from $618,436 in 1995. This increase resulted principally from
increases in payroll expenses and professional fees. The increase in
professional fees resulted principally from adjustments required to correct for
under-accruals for such fees incurred during the 1995 calendar year.
1995 Fiscal Year
Rental Income for the year ended December 31, 1995, was $1,841,892
as compared with $1,817,308 for the 1994 calendar year. The increase in income
in 1995 reflected increased rental rates for apartments at the project. These
increases were offset to some extent by greater vacancies at the property as
well as slightly increased rental allowances which were utilized to attracted
tenants to the Pavilion. Occupancy rates at the project held in the low 90%
range for the entire 1995 year. As of March 12, 1996, the Pavilion Apartments
had 20 apartments out of 312 available for rent, with an additional 12 currently
vacant apartments leased to tenants who had not yet taken possession. The 32
vacant apartments equates to a physical occupancy of 89.7%.
Cost of Rental Income, consisting mainly of real estate taxes,
repairs and maintenance and utilities, decreased in 1995 to $615,759 as compared
to the 1994 cost of $641,731. This decrease resulted primarily from reductions
in the amounts expended for replacements and repairs and maintenance at the
project as well as reduced charges for utilities resulting from somewhat lower
usage for the year.
Selling, General and Administrative Expenses for 1995 increased to
$618,436 from $583,895 in 1994. This increase resulted principally from
increases in worker's compensation insurance premiums and court costs as well as
additional accruals for administrative services. These accruals reflected
charges by the general partner for administrative services for preparation of
Registrants Forms 10K and 10Q for the 1995 calendar year for filing with the
Securities and Exchange Commission. (see "Item 13. Certain Relationships and
Related Transactions" below).
Interest Expense increased slightly in 1995 as compared to 1994
since it represented a full years interest on the first mortgage which had been
refinanced with an increased interest rate as of March 31, 1994.
INFLATION
As of the present date, inflation has not had a major impact on the
operations of the Partnership. It is anticipated that future increases in
operating expenses will be offset if not exceeded by corresponding increases in
operating income.
<PAGE>
Item 8. Financial Statements and Supplementary Data
FJS Properties Fund I, L.P.
Financial Statements
INDEX
Page
Number
Independent Auditor's Report..........................................11
Financial statements
Balance Sheets as of December 31, 1996 and 1995..................12
Statements of Operations for the years ended
December 31, 1996, 1995 and 1994.......................13
Statements of Partners' Capital [Deficit] for the years ended
December 31, 1996, 1995 and 1994.......................14
Statements of Cash Flows for the years ended
December 31, 1996, 1995 and 1994 .....................15
Notes To Financial Statements ................................16-18
Independent Auditor's Report on Supplementary Schedules...............19
Real Estate and Accumulated Depreciation..............................20
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Partners of
FJS Properties Fund I, L.P.
New York, New York
We have audited the accompanying balance sheets of FJS Properties
Fund I, L.P. as of December 31, 1996 and 1995, and the related statements of
operations, partners' capital, and cash flows for each of the three years in the
period ended December 31, 1996. These financial statements are the
responsibility of the Partnership's management. Our responsibility is to express
an opinion on these financial statements 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 financial position of FJS Properties Fund
I, L.P. as of December 31, 1996 and 1995, and the results of its operations and
its cash flows for each of the three years in the period ended December 31,
1996, in conformity with generally accepted accounting principles.
MOORE STEPHENS, P.C.
Certified Public Accountants.
Cranford, New Jersey
February 7, 1997
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------
FJS PROPERTIES FUND I, L.P.
- --------------------------------------------------------------------------------
BALANCE SHEETS
December 31,
1 9 9 6 1 9 9 5
<S> <C> <C>
Assets:
Current Assets:
Cash and Cash Equivalents $ 493,597 $ 542,337
Cash - Escrow 182,875 79,440
Cash - Security Deposits 121,167 122,367
Other Current Assets 1,430 101,040
---------- -----------
Total Current Assets 799,069 845,184
---------- -----------
Property Investment:
Land 2,296,804 2,296,804
Buildings 6,569,125 6,569,125
Furniture, Fixtures and Building Improvements 1,737,884 1,727,549
---------- -----------
Totals - At Cost 10,603,813 10,593,478
Less: Accumulated Depreciation (4,262,710) (4,011,823)
---------- -----------
Property Investment - Net 6,341,103 6,581,655
---------- -----------
Other Assets 308,781 330,033
---------- -----------
Total Assets $7,448,953 $ 7,756,872
========== ===========
Liabilities and Partners' Capital:
Current Liabilities:
Accounts Payable $ 79,843 $ 63,561
Accrued Interest 38,922 38,947
Other Accrued Expenses 7,225 8,409
Accounts Payable - Related Party 18,224 25,549
Tenant Security Deposits 121,167 122,367
Mortgage Payable - Current Portion 63,935 58,019
Deferred Income - Current Portion 7,142 --
---------- -----------
Total Current Liabilities 336,458 316,852
---------- -----------
Long-Term Liabilities:
Mortgage Payable - Non-Current Portion 4,793,033 4,856,967
Deferred Income - Non-Current Portion 39,286 --
---------- -----------
Total Long-Term Liabilities 4,832,319 4,856,967
---------- -----------
Partners' Capital:
General Partner (1,213,057) (1,210,028)
Limited Partners 3,493,233 3,793,081
---------- -----------
Total Partners' Capital 2,280,176 2,583,053
---------- -----------
Total Liabilities and Partners' Capital $7,448,953 $ 7,756,872
========== ===========
The Accompanying Notes are an Integral Part of These Financial Statements.
</TABLE>
<PAGE>
<TABLE>
FJS PROPERTIES FUND I, L.P.
STATEMENTS OF OPERATIONS
Y e a r s e n d e d
D e c e m b e r 3 1,
1 9 9 6 1 9 9 5 1 9 9 4
------- ------- -------
<S> <C> <C> <C>
Rental Income $ 1,852,877 $ 1,841,892 $ 1,817,308
Cost of Rental Income 749,911 615,759 641,731
----------- ----------- -----------
Gross Profit 1,102,966 1,226,133 1,175,577
----------- ----------- -----------
Expenses:
Selling, General and Administrative Expenses 645,114 618,436 583,895
Depreciation and Amortization 275,295 273,863 410,133
----------- ----------- -----------
Total Expenses 920,409 892,299 994,028
----------- ----------- -----------
Operating Income 182,557 333,834 181,549
----------- ----------- -----------
Other [Income] and Expenses:
Interest Income (22,646) (26,095) (15,575)
Interest Expense 476,199 481,611 438,481
----------- ----------- -----------
Total Other Expenses - Net 453,553 455,516 422,906
----------- ----------- -----------
Net [Loss] $ (270,996) $ (121,682) $ (241,357)
----------- -------- --------
[Loss] Per Limited Partnership Unit (15.98) $ (7.18)$ (14.23)
=============== ========== =========
Distributions Per Limited Partnership Unit $ 1.88 $ 5.53 4.96
=========== ============= =======
Weighted Average Number of Limited
Partnership Units Outstanding 16,788 16,788 16,788
=========== =========== ===========
The Accompanying Notes are an Integral Part of These Financial Statements.
</TABLE>
<PAGE>
<TABLE>
FJS PROPERTIES FUND I, L.P.
STATEMENTS OF PARTNERS' CAPITAL
General Limited
Partner Partners Total
<S> <C> <C> <C>
Partners' Capital - December 31, 1993 $(1,204,622) $ 4,328,600 $3,123,978
Net [Loss] for the year ended December 31, 1994 (2,413) (238,944) (241,357)
Distributions to Partners (841) (83,270) (84,111)
------- ------- ------
Partners' Capital - December 31, 1994 (1,207,876) 4,006,386 2,798,510
Net [Loss] for the year ended December 31, 1995 (1,216) (120,466) (121,682)
Distributions to Partners (936) (92,839) (93,775)
-------- ------ --------
Partners' Capital - December 31, 1995 (1,210,028) 3,793,081 2,583,053
Net [Loss] for the year ended December 31, 1996 (2,710) (268,286) (270,996)
Distributions to Partners (319) (31,562) (31,881)
--------- -------- -------
Partners' Capital - December 31, 1996 $(1,213,057) $ 3,493,233 2,280,176
============ ========== ========
The Accompanying Notes are an Integral Part of These Financial Statements.
<PAGE>
</TABLE>
<TABLE>
FJS PROPERTIES FUND I, L.P.
STATEMENTS OF CASH FLOWS
Y e a r s e n d e d
D e c e m b e r 3 1,
1 9 9 6 1 9 9 5 1 9 9 4
------- ------- -------
<S> <C> <C> <C>
Operating Activities:
Net [Loss] $ (270,996) $ (121,682) $ (241,357)
----------- ---------- -------
Adjustments to Reconcile Net [Loss] to Net
Cash Provided by Operating Activities:
Depreciation 250,887 249,455 390,246
Amortization 24,408 24,408 19,887
Changes in Assets and Liabilities:
[Increase] Decrease in:
Escrow (106,591) (70,168) (75,235)
1,200 42 4,624
Other Current Assets 99,610 32,080 (119,628)
Increase [Decrease] in:
Accounts Payable and Accrued Expenses 15,074 (8,805) 51,723
Accounts Payable - Related Party (7,325) 11,934 6,515
Tenant Security Deposits (1,200) (42) (4,624)
Deferred Income 46,428 (400) (1,600)
Total Adjustments 322,491 238,504 271,908
----------- ----------- -----------
Net Cash - Operating Activities 51,495 116,822 30,551
----------- ----------- -----------
Investing Activities:
Capital Expenditures (10,336) (2,687) (45,228)
Financing Activities:
Principal Payments on Mortgages (58,018) (52,650) (4,680,820)
Cash Distributions to Partners (31,881) (93,775) (84,111)
Loan Acquisition Fees -- -- (244,095)
Proceeds from Mortgage Refinancing -- -- 5,000,000
----------- ----------- -----------
Net Cash - Financing Activities (89,899) (146,425) (9,026)
----------- --------- -------
Net [Decrease] in Cash and Cash Equivalents (48,740) (32,290) (23,703)
Cash and Cash Equivalents - Beginning of Years 542,337 574,627 598,330
----------- ----------- -----------
Cash and Cash Equivalents - End of Years $ 493,597 $ 542,337 $ 574,627
=========== =========== ===========
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest during the years ended December 31, 1996, 1995 and 1994
was $476,639, $482,033 and $398,672, respectively.
The Accompanying Notes are an Integral Part of These Financial Statements.
</TABLE>
<PAGE>
- --------------------------------------------------------------------------------
FJS PROPERTIES FUND I, L.P.
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
[1] Organization
FJS Properties Fund I, L.P. [the "Partnership"] was formed under the Delaware
Revised Uniform Limited Partnership Act on October 5, 1984. The Partnership owns
and operates the Pavilion apartment complex in West Palm Beach, Florida.
[2] Summary of Significant Accounting Policies
Loan Acquisition Fees - The Partnership amortizes fees incurred in connection
with mortgage refinancings utilizing the straight-line method over the term of
the related mortgage, which is currently ten years.
Income Taxes - The Partnership is treated as a partnership for federal income
tax purposes. The Partnership will make no provision for income taxes because
all income and losses will be allocated to the partners for inclusion in their
respective tax returns.
Depreciation - The Partnership depreciates buildings using the straight-line
method over 30 years. Furniture and fixtures and building improvements are
depreciated using the straight-line method over periods from 3 to 10 years.
For tax purposes, the Partnership depreciates commercial real properties using
the 18-year straight-line depreciation method and residential real property
using the 18-year accelerated depreciation method for property placed in service
prior to May 8, 1985. In accordance with ongoing changes in the Internal Revenue
Code, the Partnership will utilize the depreciation method, which, in the
opinion of the Managing General Partner, will be the most beneficial to the
Partnership.
Cash Equivalents - The Partnership considers all highly liquid investments with
original maturities of three months or less to be cash equivalents.
Credit Concentration - The Partnership has amounts on deposit with financial
institutions which are approximately $370,000 in excess of the amounts insured.
Use of Estimates - 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 revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Advertising - The Company expenses advertising cost as incurred. Advertising
expense for the years ended December 31, 1996, 1995 and 1994 was $40,279,
$42,562 and $42,639, respectively.
Reclassification - Certain reclassifications have been made to prior year
financial statements to conform to classifications used in the current year.
[3] Partnership Agreement
Pursuant to the terms of the Partnership Agreement, which expires December 31,
2009, the General Partner is liable for all general obligations of the
Partnership to the extent not paid by the Partnership. The Limited Partners are
not liable for expenses, liabilities or obligations of the Partnership beyond
the amount of their contributed capital.
Pursuant to the terms of the Partnership Agreement, adjusted cash from
operations is allocated, after payment of the Partnership Management Fee to the
Managing General Partner, 99% to the Limited Partners and 1% to the General
Partner.
<PAGE>
FJS PROPERTIES FUND I, L.P.
NOTES TO FINANCIAL STATEMENTS, Sheet #2
[3] Partnership Agreement [Continued]
Pursuant to the terms of the Partnership Agreement, taxable income and loss are
allocated 99% to the Limited Partners and 1% to the General Partner subsequent
to the release of the Limited Partners' funds to the Partnership, which occurred
on May 1, 1986. Prior to the release of funds, taxable income and loss were
allocated 99% to the General Partner and 1% to the Original Limited Partner.
Pursuant to the terms of the Partnership Agreement, allocations of net income or
loss among the partners in the accrual basis financial statements will be in
conformity with the allocations of taxable income or loss from operations.
[4] Property Investment - Pavilion Apartments
Property, improvements, furniture and equipment are carried at cost and
depreciated over their estimated useful lives. The cost of maintenance and
repairs are expensed as incurred, whereas significant betterments and renewals
are capitalized.
Depreciation expense for the years ended December 31, 1996, 1995 and 1994 was
$250,887, $249,455 and $390,246, respectively.
[5] Other Assets
A summary of other assets is as follows:
December 31,
1 9 9 6 1 9 9 5
Cash in Escrow [See Note 6] $ 112,184 $ 109,028
Loan Acquisition Fees - Net of Amortization
of $66,623 and $42,215 at December 31, 1996
and 1995, Respectively 177,472 201,880
Deposits 19,125 19,125
----------- -----------
Totals $ 308,781 $ 330,003
------ =========== ===========
[6] Mortgage Payable
On March 31, 1994, the Partnership refinanced the existing first mortgage loan
held by the Bank of Tokyo. A new loan in the amount of $5,000,000,
collateralized by a first mortgage lien on the project, was obtained from the
Long Beach Bank, FSB, Orange, California. This loan is for a term of ten years
with an interest rate of 9.75% per annum. The loan is repayable in equal monthly
installments of $44,557 for principal and interest with a balloon payment due in
ten years. The new loan requires deposits with the lender for real estate taxes,
insurance premiums, a debt service reserve of one month's payment, as well as
deposits for replacement reserves for the project. These amounts are included in
"other assets" on the balance sheet. In June 1995, the loan was transferred to
Bank United of Texas. Monthly payments and interest rate remained the same.
Annual principal maturities under the total existing mortgage for the next five
years are as follows:
1997 $ 63,935
1998 70,455
1999 77,640
2000 85,557
2001 94,282
Thereafter 4,465,099
----------
Total Mortgage Payable $4,856,968
FJS PROPERTIES FUND I, L.P.
NOTES TO FINANCIAL STATEMENTS, Sheet #3
[6] Mortgage Payable [Continued]
The fair value of the Partnership's mortgage payable, which is determined by
discounting expected cash flows based on the Partnership's projected current
incremental borrowing rate, is approximately $4,600,000.
[7] Related Party Transactions
The Managing General Partner, pursuant to the Partnership Agreement, has earned
Property Management Fees of $95,505, $92,096 and $91,506 for the years ended
December 31, 1996, 1995 and 1994, respectively, of which $76,404, $73,677 and
$73,205, respectively, was paid to an unaffiliated Florida based management
company. These fees are based on a percentage of net rental income as defined in
the agreement.
Also pursuant to the Partnership Agreement, the Managing General Partner has
earned Partnership Management Fees of $1,364, $3,899 and $5,604 for the years
ended December 31, 1996, 1995 and 1994, respectively, which represents 4% of
adjusted cash flow.
Additionally, in accordance with provisions of the Partnership Agreement, the
Partnership is committed to pay to the Managing General Partner, administrative
service fees. These fees amounted to $24,000 in each of the years ended December
31, 1996 and 1995.
The Managing General Partner received distributions from cash flow of $319, $936
and $841 during the years ended December 31, 1996, 1995 and 1994, respectively.
[8] Income Taxes
The reconciliation of net losses as reported in the statements of operations and
as would be reported for tax purposes for the years ended December 31, 1996,
1995 and 1994 are as follows:
D e c e m b e r 3 1,
- -----------------------------------------------------------------------
1 9 9 6 1 9 9 5 1 9 9 4
------- ------- -------
Net [Loss] - Statement of Operations $ (270,996) $ (121,682) $(241,357)
Tax depreciation in excess of book depreciation(111,588) (133,051) (15,050)
--------- -------- -------
Net [Loss] for Tax Purposes $ (382,584)$ (254,733) $(256,407)
--------------------------- =========== ========== ========
. . . . . . . . . . . .
<PAGE>
INDEPENDENT AUDITOR'S REPORT ON
SUPPLEMENTARY SCHEDULE
To the Partners of
FJS Properties Fund I, L.P.
New York, New York
Our report on the financial statements of FJS Properties Fund I,
L.P. is included on page 11 of this Form 10-K. In connection with our audits of
such financial statements, we have also audited the related financial statement
Schedule III.
In our opinion, the financial statement schedule referred to above,
when considered in relation to the basic financial statements taken as a whole,
presents fairly, in all material respects, the information required to be
included therein.
MOORE STEPHENS, P.C.
Certified Public Accountants.
Cranford, New Jersey
February 7, 1997
<PAGE>
<TABLE>
- --------------------------------------------------------------------------------
FJS PROPERTIES FUND I, L.P.
- --------------------------------------------------------------------------------
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
Gross Amount at Which Life on which depreciation
Initial Cost to Partnership Costs Carried at Close of Period
--------------------------- ----- --------------------------
Which
- -----
Capitalized [2] [3] Depreciation
Buildings Subsequent Buildings Accumu- in Latest
and to Acquisition and lated Year of Income
Improve- [1] Improve- [1] [2] Depreci-Construc- Date Statement
Description Encumbrances Land ments Improvements Land ments Total ation tion Acquiredis Computed
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Pavilion Aparts,
West Palm beac
Florida $4,914,986 2,296,804 $7,196,789 $ 1,110,220 $2,296,804 $ 8,307,009 $10,603,813 4,262,710 1972 1/85 3-30 yrs.
========== ========= ========== ========= =========== ========= ======== ========
1) The aggregate cost for federal income tax purposes is $8,695,072.
2) A reconciliation of the carrying amount of land, buildings and improvements
as of December 31, 1996, 1995 and 1994 is as follows:
</TABLE>
<TABLE>
C o s t a s o f
D e c e m b e r 3 1,
1 9 9 6 1 9 9 5 1 9 9 4
------- ------- -------
<S> <C> <C> <C>
Balance at Beginning of Years $10,593,478 $ 10,590,791 $ 10,545,563
Improvements 10,335 2,687 45,228
--------- -------- --------
Balance at End of Years $10,603,813 $ 10,593,478 $ 10,590,791
=========== ============= ================
3) A reconciliation of accumulated depreciation for the years ended December 31, 1996, 1995 and 1994 is as
follows:
</TABLE>
<TABLE>
Accumulated Depreciation as of
D e c e m b e r 3 1,
1 9 9 6 1 9 9 5 1 9 9 4
<S> <C> <C> <C>
Balance at Beginning of Years $4,011,823 $ 3,762,368 $ 3,372,122
Depreciation Expense 250,887 249,455 390,246
--------- -------- --------
Balance at End of Years $4,262,710 $ 4,011,823 $ 3,762,368
========== ============ ===============
</TABLE>
<PAGE>
Item 9. Changes In and Disagreements With Accountants on Accounting and
Financial Disclosure
None.
PART III
Item 10. Directors and Executive Officers of the Registrant
Registrant has no officers or directors. FJS Properties, Inc., the
General Partner, manages and controls the Registrant's affairs and has general
responsibility and ultimate authority in all matters affecting its business. The
names and ages of, as well as the positions held by, the officers and directors
of the General Partner are as follows:
NAME AGE OFFICES HELD SERVED AS AN
OFFICER AND/OR
DIRECTOR SINCE
A Andrew C. Alson 51 President and 1/85
Director
Roger Barnett 52 Secretary and Treasurer 1/88
Lawrence E. Bathgate 57 Director 10/84
II
Robert E. Brennan 53 Director 10/84
There are no family relationships between any executive officer or
director and any other executive officer or director of the General Partner.
Andrew C. Alson is a director and President of the General Partner.
Until May, 1995, Mr. Alson was a Director of and until January 1, 1993, was
President and Chief Executive Officer of PriMedex Health Systems, Inc.
("PMDX"), a public company which is principally engaged through its
wholly-owned subsidiary, RadNet Management, Inc. in the healthcare services
industry. Until June 16, 1994, Mr. Alson, as a designee of PMDX, also
served as a director of ImmunoTherapeutics, Inc. ("IMNO"). IMNO is a publicly
owned development stage Minnesota based company which is engaged in the
research and development of immunotherapeutic drugs, primarily for the
treatment of cancer. Mr. Alson is an attorney admitted to the bar of the
State of New York, and is a graduate of the
University of Pennsylvania and the Fordham University School of Law.
Roger Barnett is the Secretary/Treasurer of the General Partner. Mr.
Barnett is the president of First Jersey Securities, Inc., a post he assumed in
April 1987. For more than five years prior to such date, Mr. Barnett was
treasurer and chief financial officer of First Jersey. Until May 1995 Mr.
Barnett was a director of, and until May 1994 was Secretary/Treasurer of
Primedex Health Systems, Inc.
Lawrence E. Bathgate, II is a director of the General Partner.
Mr. Bathgate is thesenior partner of Bathgate, Wegener & Wolf, P.A., a law
firm in Lakewood and Newark, New Jersey. Mr.Bathgate is a graduate of
Villanova University, Villanova, Pennsylvania and Rutgers Law School,
Newark, New Jersey. Mr. Bathgate also engages in extensive real estate
and other investment activities. Mr. Bathgate owns 20% of the common stock
of the General Partner. Mr. Bathgate is adirector of Carson, Inc., a
publicly held company listed on the New York Stock Exchange. Around
September 20, 1991, Marlboro Development Group ("MDG"), of which Mr.
Bathgate is one of four individual general partners, filed a Chapter 11
Bankruptcy proceeding in the Federal BankruptcyCourt, Trenton,
New Jersey (Docket No. 91-35352. MDG is the owner of 318 acres of raw land
locatedin Marlboro Township, Monmouth County, New Jersey, and filed a plan
of reorganization under Chapter11 within the Bankruptcy proceeding.
In 1993, the Bankruptcy petition was dismissed and all
creditors satisfied.
Robert E. Brennan is a director of the General Partner. Mr. Brennan
has been principally engaged for the past five years as the sole stockholder
(and until September, 1986, was Chief Executive Officer and Chairman of the
Board) of First Jersey. He is presently the sole stockholder and a director of
First Jersey. He has in the past held several additional corporate positions,
including until November 1995, but not presently, director, Chairman of the
Board and Chief Executive Officer of International Thoroughbred Breeders, Inc.
("ITB"), a publicly owned commercial breeder of thoroughbred horses and the
owner and operator of Garden State Racetrack in Cherry Hill, New Jersey. Mr.
Brennan was, but is not presently, a principal stockholder of ITB. Mr. Brennan
has served from time to time during the past five years, but not presently, as a
member of the Board of Regents of Seton Hall University. Mr. Brennan is
controlling stockholder of the General Partner.
On June 19, 1995, Judge Richard Owen, District Judge of the United
States Court for the Southern District of New York issued his opinion and on
July 14, 1995 entered a judgment in a lawsuit commenced in 1985 by the
Securities and Exchange Commission (the "Commission") against Robert E. Brennan
and First Jersey (the "Defendants"). In its opinion and judgment, the court
determined that the Defendants, with respect to sales and resales of the
securities of five issuers (not those of the Partnership), charged excessive
markups and markdowns to First Jersey customers and thereby violated ss.17(a) of
the Securities Act of 1933 (the "Securities Act") and ss.10(b) of the Securities
Exchange Act of 1934 (the "Exchange Act") and violated Rule 10b-5 in that they
engaged in fraud in those transactions. As a result, the court permanently
enjoined the Defendants from further violations of Securities Act ss.17(a),
Exchange Act ss.10(b) and Rule 10b-5.
In addition the court ordered that the Defendants disgorge an
aggregate $22,288,099 of profits together with $49,251,521 of prejudgment
interest (as of December 31, 1994). The court also ordered the appointment of a
special agent to examine the records of First Jersey for the period from
November 1, 1982 through January 31, 1987 for the purpose of determining whether
excessive markups and/or markdowns were charged to First Jersey customers beyond
those proved at trial.
On appeal to the Federal 2nd Circuit Appeals court, this judgment
was upheld with the exception of the appointment of the special agent which was
reversed. A petition for rehearing which was filed with the 2nd Circuit was
denied. The defendants expect to file an appeal with the United States Supreme
Court in the future. As a result of the judgment and in order to preserve
control over their assets pending the outcome of final appeals, on August 7,
1995, Robert E. Brennan and First Jersey filed voluntary petitions for relief in
the United States Bankruptcy Court for the District of New Jersey under Chapter
11 of the Bankruptcy Code.
On August 9, 1995, the State of New Jersey and the New Jersey Bureau
of Securities instituted a civil action against Brennan, Barnett and others
alleging, inter alia, securities fraud and racketeering activity. The complaint
seeks injunctive relief, restitution and civil monetary penalties. Defendants
deny any violations of law and intend to vigorously defend against this action.
No assurances can be given as to the outcome of this matter.
All of the directors will hold office until the next annual meeting
of the stockholders of the General Partner and until their successors are
elected and qualified.
Compliance with Section 16(a) of the Exchange Act
Based solely upon a review of Forms 3 and 4 (17 CFR 249.103 and
249.104) and any amendments thereto furnished to Registrant under Rule 16a-3(d)
(17 CFR 240.16a-3(e) or written representations received by Registrant that no
Forms 5 were required, Registrant believes that there were no officers,
directors or beneficial owners of more than 10% of any class of equity
securities of Registrant registered pursuant to Section 12, that failed to file
on a timely basis any reports required by Section 16(a) during the most recent
fiscal years.
Item 11. Executive Compensation
The Registrant is not required to pay and did not pay any
remuneration to the officers
and directors of the General Partner. See Item 12, "Certain Relationships and
Related Transactions."
Item 12. Security Ownership of Certain Beneficial Owners and Management
The Family Trust, a New Jersey trust, which was established by
Robert Brennan, but as to which Mr. Brennan is neither a Trustee nor a
Beneficiary, owns 1,558 Units (9.28%). No other person was known by Registrant
to own beneficially more than 5% of the outstanding Units of Registrant. No
directors, officers or partners of the General Partner own Units of Registrant
except for the five Units owned by Mr. Bathgate, as the initial limited partner.
As of March 1, 1997, Robert E. Brennan and Lawrence E. Bathgate, II
were the sole shareholders of the common stock of the General Partner, owning
80% and 20% respectively.
Item 13. Certain Relationships and Related Transactions
During Registrant's fiscal years ended December 31, 1996, 1995 and
1994, the General Partner and certain affiliated entities have earned or
received compensation or payments for services from Registrant or its General
Partner as follows:
eimbursement/Compensation
--------------------------
Name of Recipient Capacity in Which served 1996 1995 1994
-----------------
or Payment
Received
--------------------------
--------------------------
FJS Properties, General Partner3 $319 $936 $841
Inc.
--------------------------
--------------------------
Partnership Management $1,364 $3,899 $5,604
Fee
--------------------------
Property Management Fee4 $19,101 $18,419 $18,301
--------------------------
--------------------------
Administrative Expenses5 $24,000 $24,000 $0
--------------------------
--------------------------
Lawrence E. Initial Limited Partner6 $9 $28 $26
Bathgate II
--------------------------
--------------------------
Other Officer/Director of $0 $0 $0
Officers/Directors General Partner
of General Partner
--------------------------
3 Represents the General Partner's interest in Adjusted
Cash From Operations. Under Registrant's Partnership
Agreement 99% of the Net Income and Net Loss of Registrant
was allocated to the Limited Partners and 1% was allocated
to the General Partner. Pursuant thereto, for the years
ended December 31, 1996, 1995 and 1994, $3,826, $2,547 and
$2,564 of the Registrant's taxable loss was allocated to
FJS Properties, Inc. For further information, reference is
made to the material contained in the Prospectus under the
heading "MANAGEMENT COMPENSATION."
4 The following property management fees were applicable
to the years 1996, 1995 and 1994:
---------------------------------------------------------------
YEAR Aggregate Retained by Paid to local
Management Fee General Partner unaffiliated
management
company
---------------------------------------------------------------
---------------------------------------------------------------
1996 $95,505 $19,101 $76,404
---------------------------------------------------------------
---------------------------------------------------------------
1995 $92,096 $18,419 $73,677
---------------------------------------------------------------
---------------------------------------------------------------
1994 $91,506 $18,301 $73,205
------------------------------------------------------
In addition, the local unaffiliated management company received construction
supervision fees of $19,605 during 1996 and $1,624 during 1994, for supervision
of outside construction work at the Pavilion Apartments.
5 Represents administrative fees for preparation of this
Form 10K for the calendar years ended December 31, 1995 and
1996, and Forms 10Q for the calendar quarters ended March
31, June 30, and September 30, 1995 and 1996, for filing
with the Securities and Exchange Commission. Such charges
are in accordance with and pursuant to ss.10.1.3(b) of the
Partnership Agreement of Registrant and do not exceed 90%
of the amount Registrant would be required to pay to
independent parties for comparable administrative services
in the same geographic location.
6 Represents distribution of Adjusted Cash From Operations
attributable to the five Units Owned by Mr. Bathgate and
includes the distribution for the fourth quarter of 1995
which was made in February 1996. For the years ended
December 31, 1996, 1995, and 1994, $112.81, $75.10 and
$75.60 of the Registrant's taxable loss was allocated to
his Units.
In addition, certain officers and directors of the General Partner
receive compensation from the General Partner, First Jersey and/or its
affiliates (but not from Registrant) for services performed for various
affiliated entities, which may include services performed for Registrant.
Bathgate, Wegener & Wolf, PA, the law firm in which Mr. Bathgate is
a partner, was retained by Registrant during 1994 for representation in
connection with the refinance of the existing first mortgage loan. Such firm
received a payment in 1994 of $20,027.00 for services rendered and out of pocket
costs in connection with such transaction.
<PAGE>
PART IV
Item 14. Exhibits Financial Statement Schedules, and Reports On Form 8-K
1. Financial Statements: See Index to Financial Statements in Item 8.
(a) 2. Exhibits:
3.4 (a) Agreement of Limited Partnership, dated
as of April 30, 1985, incorporated by reference
to Exhibit A to the Prospectus of Registrant dated
June 10, 1985 included in Registrant's Registration
Statement on Form S-11
(Reg. No. 2-93980).
(b) Amendment to Agreement of Limited Partnership
dated as of October 22, 1985 incorporated by reference
to Exhibit 3A.1 to Registrant's Registration
Statement on Form S-11 (Reg. No. 2-93980).
(c) Amendment to Agreement of Limited Partnership dated
as of October 22, 1985, incorporated by reference to
Exhibit 3.4(c) to Registrant's Annual Report on Form
10-K for the fiscal year ended December 31, 1986 (File
No 2-93980).
(d) Amendment to Agreement of Limited Partnership, dated
as of March 24, 1987, incorporated by reference to
Exhibit 3.4(d) to Registrant's Annual Report on Form
10-K for the fiscal year ended December 31, 1987 (File
No 2-93980).
(e) Amendment No. 1 to Amended and Restated Certificate
of Limited Partnership, dated as of August 17, 1987,
incorporated by reference to Exhibit 3.4(e) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1987 (File No 2-93980).
10. (a) Acquisition and Disposition Agreement
dated as of May 2, 1986 between Registrant
and FJS Properties, Inc., incorporated by reference to
Exhibit 10A to Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1986
(File No. 2- 93980).
(b) Management Services Agreement dated as of May 2,
1986 between Registrant and FJS Properties, Inc.,
incorporated by reference to Exhibit 10B to Registrant's
Annual Report on Form 10-K for the fiscal year ended
December 31, 1986 (File No. 2-93980).
(c) Contract for Sale and Purchase dated December 17,
1984, between Rockwell Investments, Ltd. and
Registrant, incorporated by reference to Exhibit 10D to
Registrant's Registration Statement on Form S-11
(Reg. No. 2-93980.)
(d) Contract for Sale and Purchase dated December 17,
1984, between Vinsteve Investments Inc., Jimstein
Investments, Ltd., Barwell Corporation, N.W. and
Registrant, incorporated by reference to Exhibit
10E to Registrant's
Registration Statement on Form S-11 (Reg. No. 2-93980.)
(e) Mortgage and Security Agreement dated September 9,
1987, by FJS Properties Fund I, L.P., as mortgagor, and
The Bank of Tokyo, Ltd., Miami Agency, as mortgagee,
incorporated by reference to Exhibit 10(g) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1987 (File No 2-93980).
(f) Mortgage Note, dated September 9, 1987, by FJS
Properties Fund I, L.P. as maker to The Bank of Tokyo,
Ltd., Miami Agency, as payee in the principal amount of
$5,000,000, incorporated by reference to Exhibit 10(h)
to Registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1987 (File No 2-93980).
(g) Modification of Note, Mortgage and Assignment
Agreement, dated as of September 9, 1992, between FJS
Properties Fund I, L.P. as Mortgagor, and The Bank Of
Tokyo, Ltd., Miami Agency, as Mortgagee incorporated by
reference to Exhibit 10(g) to Registrant's Annual Report
on Form 10-K for the fiscal year ended December 31, 1987
(File No 0-15755).
(h) Modification of Note, Mortgage and Assignment
Agreement, dated as of November 10, 1992, between FJS
Properties Fund I, L.P. as Mortgagor, and The Bank Of
Tokyo, Ltd., Miami Agency, as Mortgagee incorporated by
reference to Exhibit 10(h) to Registrant's Annual Report
on Form 10-K for the fiscal year ended December 31, 1987
(File No 0-15755).
(i) Modification of Note, Mortgage and Assignment
Agreement, dated as of March 31, 1993, between FJS
Properties Fund I, L.P. as Mortgagor, and The Bank of
Tokyo, Ltd., Miami Agency, as Mortgagee incorporated by
reference to Exhibit 10(i) to Registrant's Annual Report
on Form 10-K for the fiscal year ended December 31, 1987
(File No 0-15755).
(j) Renewal Note, dated March 31, 1993, made by FJS
Properties Fund I, L.P. to the Bank of Tokyo, Ltd
incorporated by reference to Exhibit 10(j) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1987 (File No 0-15755).
(k) Property Management Agreement made as of December
1993, between FJS Properties Fund I, L.P., Owner, and
M.L. Property Management, Inc., Managing Agent,
incorporated by reference to Exhibit 10(k) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993 (File No 0-15755).
(l) Third Modification of Note, Mortgage and Assignment
Agreement dated as of February 28, 1994, between FJS
Properties Fund I, L.P. and The Bank of Tokyo, Ltd.,
incorporated by reference to Exhibit 10(l) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993 (File No 0-15755).
(m) Multifamily Note, dated March 29, 1994, made by FJS
Properties Fund I, L.P. to Long Beach Bank, FSB, in the
principal amount of $5,000,000, incorporated by
reference to Exhibit 10(m) to Registrant's Annual Report
on Form 10-K for the fiscal year ended December 31, 1993
(File No 0-15755).
(n) Multifamily Mortgage, Assignment of Rents and
Security Agreement and Fixture Filing, dated March 29,
1994, made by FJS Properties Fund I, L.P. to Long Beach
Bank, FSB, incorporated by reference to Exhibit 10(n) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993 (File No 0-15755).
(o) Assignment of Leases, dated March 29, 1994, made by
FJS Properties Fund I, L.P. to Long Beach Bank, FSB,
incorporated by reference to Exhibit 10(o) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993 (File No 0-15755).
(p) Operations and Maintenance Agreement dated March 29,
1994, between FJS Properties Fund I, L.P. and Long Beach
Bank, FSB, incorporated by reference to Exhibit 10(p) to
Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1993 (File No 0-15755).
(q) Debt Service Reserve Fund Security Agreement, dated
March 29, 1994, between FJS Properties Fund I, L.P. and
Long Beach Bank, FSB, incorporated by reference to
Exhibit 10(q) to Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1993 (File No
0-15755).
(r) Replacement Reserve and Security Agreement, dated
March 29, 1994, between FJS Properties Fund I, L.P. and
Long Beach Bank, FSB, incorporated by reference to
Exhibit 10(r) to Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1993 (File No
0-15755).
(s) Completion/Repair and Security Agreement, dated
March 29, 1994, between FJS Properties Fund I, L.P. and
Long Beach Bank, FSB, incorporated by reference to
Exhibit 10(s) to Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1993 (File No
0-15755).
(b) Reports on Form 8-K filed during the last quarter of the
fiscal year:
None.
Financial Statement Schedules Filed Pursuant to Item 13(B)
See Index to Financial Statements in Item 8.
<PAGE>
Page S-1
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.
FJS PROPERTIES FUND I, L.P.
FJS PROPERTIES, INC.
General Partner
Dated: March 19, 1997 By: Andrew C. Alson
-----------------
Andrew C. Alson, President
Pursuant to the requirements of the Securities and Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities (with respect to the General Partner) and on
the dates indicated.
Dated: March 19, 1997 By: Robert E. Brennan
-------------------
Robert E. Brennan, Director
of the General
Partner
Dated: March 19, 1997 By: Lawrence E. Bathgate, II
--------------------------
Lawrence E. Bathgate, II
Director of the
General Partner
Dated: March 19, 1997 By: Andrew C. Alson
-----------------
Andrew C. Alson, President
and Director of the
General Partner
(Principal Executive Officer)
Dated: March 19, 1997 By: Roger Barnett
---------------
Roger Barnett, Secretary and
Treasurer of the
General Partner
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> year
<FISCAL-YEAR-END> dec-31-1996
<PERIOD-END> dec-31-1996
<CASH> 493,597
<SECURITIES> 121,167
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 799,069
<PP&E> 10,603,813
<DEPRECIATION> 4,262,710
<TOTAL-ASSETS> 7,448,953
<CURRENT-LIABILITIES> 336,458
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,280,176
<TOTAL-LIABILITY-AND-EQUITY> 7,448,953
<SALES> 1,852,877
<TOTAL-REVENUES> 1,852,877
<CGS> 749,911
<TOTAL-COSTS> 920,409
<OTHER-EXPENSES> (22,646)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 476,199
<INCOME-PRETAX> (270,996)
<INCOME-TAX> 0
<INCOME-CONTINUING> (270,966)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (270,966)
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<EPS-DILUTED> 1.88
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