<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
June 30, 1995
For the period ended ____________________________________________________
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ___________________ to ___________________
0-14122
Commission File Number: _________________________________________________
First Capital Institutional Real Estate, Ltd. - 3
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 36-3330657
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Two North Riverside Plaza, Suite 950, Chicago, Illinois 60606-2607
------------------------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
(312) 207-0020
--------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
--------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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
--- ---
DOCUMENTS INCORPORATED BY REFERENCE:
The First Amended and Restated Certificate and Agreement of Limited Partnership
filed as Exhibit A to the definitive Prospectus dated January 17, 1985,
included in the Registrant's Registration Statement on Form S-11 (Registration
No. 2-79092), is incorporated herein by reference in Part I of this report.
<PAGE>
BALANCE SHEETS
(All dollars rounded to nearest 00s)
<TABLE>
<CAPTION>
June 30,
1995 December 31,
(Unaudited) 1994
----------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Investment in commercial rental properties:
Land $ 1,908,600 $ 1,908,600
Buildings and improvements 18,788,100 18,713,300
----------------------------------------------------------------------------
20,696,700 20,621,900
Accumulated depreciation and amortization (5,439,500) (5,024,100)
----------------------------------------------------------------------------
Total investment properties, net of accumulated
depreciation and amortization 15,257,200 15,597,800
Cash and cash equivalents 8,449,600 8,442,900
Restricted certificates of deposit 62,500 62,500
Investment in joint venture 5,083,500 5,234,600
Rents receivable 33,000 24,800
Other assets (including amounts due from joint
venture of $780,900 and $725,500, respectively) 800,700 757,600
----------------------------------------------------------------------------
$29,686,500 $30,120,200
----------------------------------------------------------------------------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses $ 293,900 $ 360,000
Due to Affiliates 125,700 107,400
Security deposits 50,000 51,500
Distributions payable 660,700 559,000
Other liabilities 5,000 3,500
----------------------------------------------------------------------------
1,135,300 1,081,400
----------------------------------------------------------------------------
Partners' (deficit) capital:
General Partner (163,300) (163,300)
Limited Partners (45,737 Units authorized, issued
and outstanding) 28,714,500 29,202,100
----------------------------------------------------------------------------
28,551,200 29,038,800
----------------------------------------------------------------------------
$29,686,500 $30,120,200
----------------------------------------------------------------------------
</TABLE>
STATEMENTS OF PARTNERS' CAPITAL
For the six months ended June 30, 1995
and the year ended December 31, 1994
(Unaudited)
(All dollars rounded to nearest 00s)
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
------------------------------------------------------------------------------
<S> <C> <C> <C>
Partners' (deficit) capital,
January 1, 1994 $(147,800) $31,764,300 $31,616,500
Net income for the year ended
December 31, 1994 140,400 (1,159,500) (1,019,100)
Distributions for the year ended
December 31, 1994 (155,900) (1,402,700) (1,558,600)
------------------------------------------------------------------------------
Partners' (deficit) capital,
December 31, 1994 (163,300) 29,202,100 29,038,800
Net income for the six months ended June
30, 1995 129,600 678,700 808,300
Distributions for the six months ended
June 30, 1995 (129,600) (1,166,300) (1,295,900)
------------------------------------------------------------------------------
Partners' (deficit) capital,
June 30, 1995 $(163,300) $28,714,500 $28,551,200
------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
STATEMENTS OF INCOME AND EXPENSES
For the quarters ended June 30, 1995 and 1994
(Unaudited)
(All dollars rounded to nearest 00s
except per Unit amounts)
<TABLE>
<CAPTION>
1995 1994
------------------------------------------------------------------------------
<S> <C> <C>
Income:
Rental $ 748,200 $861,900
Interest 175,900 71,400
Income from participation in joint venture 121,500 63,900
------------------------------------------------------------------------------
1,045,600 997,200
------------------------------------------------------------------------------
Expenses:
Depreciation and amortization 207,400 244,000
Property operating:
Affiliates 37,800 83,600
Nonaffiliates 143,900 123,600
Real estate taxes 79,400 95,200
Insurance--Affiliate 6,400 8,100
Repairs and maintenance 98,400 132,500
General and administrative:
Affiliates 6,800 10,500
Nonaffiliates 51,600 52,400
Loss on sale of Property 48,700
------------------------------------------------------------------------------
631,700 798,600
------------------------------------------------------------------------------
Net income $ 413,900 $198,600
------------------------------------------------------------------------------
Net income allocated to General Partner $ 66,100 $ 30,000
------------------------------------------------------------------------------
Net income allocated to Limited Partners $ 347,800 $168,600
------------------------------------------------------------------------------
Net income allocated to Limited Partners per Unit (45,737
Units authorized, issued and outstanding) $ 7.60 $ 3.69
------------------------------------------------------------------------------
</TABLE>
STATEMENTS OF INCOME AND EXPENSES
For the six months ended June 30, 1995 and 1994
(Unaudited)
(All dollars rounded to nearest 00s
except per Unit amounts)
<TABLE>
<CAPTION>
1995 1994
-------------------------------------------------------------------------
<S> <C> <C>
Income:
Rental $1,543,900 $1,761,000
Interest 318,900 135,700
Income from participation in joint venture 190,800 113,500
-------------------------------------------------------------------------
2,053,600 2,010,200
-------------------------------------------------------------------------
Expenses:
Depreciation and amortization 415,400 491,600
Property operating:
Affiliates 86,400 134,100
Nonaffiliates 283,500 310,900
Real estate taxes 158,700 186,400
Insurance--Affiliate 12,500 16,300
Repairs and maintenance 173,600 250,700
General and administrative:
Affiliates 17,200 20,300
Nonaffiliates 98,000 90,700
Loss on sale of Property 48,700
-------------------------------------------------------------------------
1,245,300 1,549,700
-------------------------------------------------------------------------
Net income $ 808,300 $ 460,500
-------------------------------------------------------------------------
Net income allocated to General Partner $ 129,600 $ 55,000
-------------------------------------------------------------------------
Net income allocated to Limited Partners $ 678,700 $ 405,500
-------------------------------------------------------------------------
Net income allocated to Limited Partners per Unit
(45,737 Units authorized, issued and outstanding) $ 14.84 $ 8.87
-------------------------------------------------------------------------
</TABLE>
STATEMENTS OF CASH FLOWS
For the six months ended June 30, 1995 and 1994
(Unaudited)
(All dollars rounded to nearest 00s)
<TABLE>
<CAPTION>
1995 1994
------------------------------------------------------------------------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 808,300 $ 460,500
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 415,400 491,600
Loss on sale of property 48,700
Changes in assets and liabilities:
(Increase) decrease in rents receivable (8,200) 10,400
Decrease in other assets 12,200 44,300
(Decrease) in accounts payable and accrued expenses (66,100) (195,000)
Increase in due to Affiliates 18,300 25,200
Increase (decrease) in other liabilities 1,500 (41,700)
------------------------------------------------------------------------------
Net cash provided by operating activities 1,181,400 844,000
------------------------------------------------------------------------------
Cash flows from investing activities:
Proceeds from the sale or disposition of property 2,170,300
Payments for capital and tenant improvements (74,800) (287,300)
Distributions received from joint venture in excess
of income allocated 151,100 99,100
(Funding of) collection of loans to joint venture (55,300) 47,600
------------------------------------------------------------------------------
Net cash provided by investing activities 21,000 2,029,700
------------------------------------------------------------------------------
Cash flows from financing activities:
Distributions paid to Partners (1,194,200) (384,700)
(Decrease) in security deposits (1,500) (21,300)
------------------------------------------------------------------------------
Net cash (used for) financing activities (1,195,700) (406,000)
------------------------------------------------------------------------------
Net increase in cash and cash equivalents 6,700 2,467,700
Cash and cash equivalents at the beginning of the
period 8,442,900 5,831,100
------------------------------------------------------------------------------
Cash and cash equivalents at the end of the period $ 8,449,600 $8,298,800
------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
June 30, 1995
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
DEFINITION OF SPECIAL TERMS:
Capitalized terms used in this report have the same meaning as those terms have
in the Partnership's Registration Statement on Form S-11, filed with the
Securities and Exchange Commission. Definitions of these terms are contained in
Article III of the First Amended and Restated Certificate and Agreement of
Limited Partnership, which is incorporated herein by reference.
ACCOUNTING POLICIES:
The financial statements have been prepared in accordance with generally
accepted accounting principles. Under this method of accounting, revenues are
recorded when earned and expenses are recorded when incurred.
The financial information included in these financial statements is unaudited;
however, in management's opinion, all adjustments (consisting of only normal,
recurring accruals) necessary for a fair presentation of the results of
operations for the periods included have been made. Results of operations for
the quarter and six months ended June 30, 1995 are not necessarily indicative
of the operating results for the year ending December 31, 1995.
The financial statements include the Partnership's interest in three joint
ventures with Affiliated partnerships. The joint ventures were formed for the
purpose of acquiring a 100% interest in certain real properties. These joint
ventures are operated under the common control of the General Partner.
Accordingly, the Partnership's pro rata share of such ventures' revenues,
expenses, assets and liabilities is included in the financial statements.
Investment in joint venture represents the recording of the Partnership's
interest, under the equity method of accounting, in a joint venture with an
Affiliated partnership. The joint venture acquired a majority preferred
interest in a joint venture with the seller of the Lansing, Michigan property.
Under the equity method of accounting, the Partnership records its initial
interest at cost and adjusts its investment account for its share of joint
venture income or loss and its distribution of cash flow.
Cash equivalents are considered all highly liquid investments purchased with a
maturity of three months or less.
Certain reclassifications have been made to the previously reported 1994
statements in order to provide comparability with the 1995 statements. These
reclassifications have not changed the 1994 results.
Reference is made to the Partnership's annual report for the year ended
December 31, 1994, for a description of other accounting policies and
additional details of the Partnership's financial condition, results of
operations, changes in Partners' capital and changes in cash balances for the
year then ended. The details provided in the notes thereto have not changed
except as a result of normal transactions in the interim or as otherwise stated
herein.
2. RELATED PARTY TRANSACTIONS:
Subsequent to May 16, 1986, the Termination of the Offering, the General
Partner is entitled to 10% of distributable Cash Flow as its Partnership
Management Fee. For the quarter and six months ended June 30, 1995, the General
Partner was allocated a Partnership Management Fee of approximately $66,100 and
$129,600, respectively, in conjunction with the declaration of cash
distributions to the Limited Partners.
In accordance with the Partnership Agreement, Net Profits are generally
allocated first to the General Partner in an amount equal to the greater of the
General Partner's Partnership Management Fee or 1% of Net Profits. The balance
of Net Profits, if any, is allocated to the Limited Partners. Net Losses
(exclusive of Net Losses from the sale or disposition of a Partnership
property) are allocated 1% to the General Partner and 99% to the Limited
Partners. Net Losses from the sale or disposition of a Partnership property are
allocated first, to the General Partner and Limited Partners pro rata, in
proportion to the positive balance in their capital accounts until the positive
balance is reduced to zero and second, the balance, if any, ninety-nine percent
(99%) to the Limited Partners and one percent (1%) to the General Partner.
Notwithstanding anything to the contrary, the General Partner shall be
allocated not less than one percent (1%) of Net Losses from the sale or
disposition of a Partnership property.
Fees and reimbursements paid and payable by the Partnership to Affiliates
during the quarter and six months ended June 30, 1995 are as follows:
<TABLE>
<CAPTION>
Paid
---------------
Six
Quarter Months Payable
-------------------------------------------------------------------------------
<S> <C> <C> <C>
Property management and leasing fees $45,000 $65,900 $ 80,900
Reimbursement of property insurance premiums, at cost 12,500 12,500 None
Real estate commission (a) None None 40,200
Reimbursement of expenses, at cost:
(1) Accounting 3,100 8,600 2,300
(2) Investor communication 2,900 7,700 2,300
(3) Legal 4,100 4,200 None
-------------------------------------------------------------------------------
$67,600 $98,900 $125,700
-------------------------------------------------------------------------------
</TABLE>
(a) As of June 30, 1995, $40,200 was due to the General Partner for real estate
commissions earned in connection with the sale and disposition of
Partnership properties. These commissions have been accrued but not paid.
Under the terms of the Partnership Agreement, these commissions will not be
paid until such time as the Limited Partners have received cumulative
distributions of Sale or Financing Proceeds equal to 100% of their Original
Capital Contribution plus a cumulative return (including all Cash Flow
which has been distributed to the Limited Partners) of 6% simple interest
per annum on their Capital Investment from the initial date of investment.
3. RESTRICTED CERTIFICATES OF DEPOSIT:
Restricted certificates of deposit include negotiable certificates of deposit
in the amounts of $25,000 and $12,500 which have been pledged as collateral for
security deposits to the Houston Lighting & Power Company and $25,000 which has
been pledged as collateral for security deposits to the Florida Lighting &
Power Company.
4
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reference is made to the Partnership's annual report for the year ended
December 31, 1994, for a discussion of the Partnership's business.
OPERATIONS
The table below is a recap of certain operating results of each of the
Partnership's properties for the quarters and six months ended June 30, 1995
and 1994. The discussion following the table should be read in conjunction with
the Financial Statements and Notes thereto appearing in this report.
<TABLE>
<CAPTION>
Comparative Operating Results (a)
For the Quarters For the Six
Ended Months Ended
6/30/95 6/30/94 6/30/95 6/30/94
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PARK PLAZA
PROFESSIONAL BUILDING
Rental revenues $413,100 $448,600 $857,600 $894,700
-----------------------------------------------------------------------------
Property net income $ 97,300 $110,800 $233,700 $229,900
-----------------------------------------------------------------------------
Average occupancy 87.9% 87.4% 88.1% 87.7%
-----------------------------------------------------------------------------
ELLIS BUILDING
Rental revenues $276,000 $257,900 $564,600 $535,100
-----------------------------------------------------------------------------
Property net income $ 76,300 $ 52,300 $154,200 $133,600
-----------------------------------------------------------------------------
Average occupancy 95.7% 93.8% 95.8% 90.7%
-----------------------------------------------------------------------------
3120 SOUTHWEST FREEWAY OFFICE BUILDING
Rental revenues $ 59,100 $ 57,300 $121,700 $114,600
-----------------------------------------------------------------------------
Property net income $ 2,600 $ (2,300) $ 8,400 $ (500)
-----------------------------------------------------------------------------
Average occupancy 92.3% 89.1% 94.1% 89.9%
-----------------------------------------------------------------------------
WELLINGTON C; WELLINGTON
NORTH OFFICE COMPLEX (B)
Rental revenues $ 98,100 $216,600
-----------------------------------------------------------------------------
Property net income $ 7,600 $ 8,800
-----------------------------------------------------------------------------
Average occupancy 90.9% 90.3%
-----------------------------------------------------------------------------
</TABLE>
(a) The above table excludes certain income and expense items which are either
not directly related to individual property operating results such as
interest income, general and administrative expenses and income from
participation in joint venture or are related to properties previously
owned by the Partnership.
(b) This property was sold on June 8, 1994. The property net income excludes
loss on sale of property of ($48,700) which is included in the Statements
of Income and Expenses for the quarter and six month periods ended June 30,
1994.
Net income for the Partnership increased $215,300 and $347,800, respectively,
for the quarter and six months ended June 30, 1995 when compared to the quarter
and six months ended June 30, 1994. The primary reason for this change was the
sale of Wellington North Office Complex ("Wellington "C" ") on June 8, 1994.
The sale of this property accounted for the significant decreases in rental
income, interest expense, property operating expenses, depreciation and
amortization expense, real estate tax expense, insurance expense and repairs
and maintenance. Accordingly, the comparison of operating results between
periods is complicated. For further information regarding the sale of
Wellington C, refer to note (b) to above table.
Net income, exclusive of Wellington C, increased $174,100 or 72.6% for the
quarter ended June 30, 1995 when compared to the quarter ended June 30, 1994.
The increase in net income for the quarterly periods under comparison was
primarily due to: 1) improved operating results at the Ellis Building ("Ellis")
and 3120 Southwest Freeway ("Southwest Freeway") totaling approximately
$28,900; 2) increased interest income of approximately $104,500 or 146.4% due
to an increase in rates available on the Partnership's short-term investments
and 3) an increase in income from the Partnership's equity investment in the
joint venture which owns Holiday North and South Office Park ("Holiday") of
approximately $57,600. Partially offsetting the increase in net income for the
quarterly periods under comparison was decreased operating results at Park
Plaza Professional Building ("Park Plaza") of approximately $13,500.
Net income, exclusive of Wellington C, increased $307,900 or 61.5% for the six
months ended June 30, 1995 when compared to the six months ended June 30, 1994.
The increase in net income for the six month periods under comparison was
primarily due to: 1) increased operating results at all of the Partnership's
properties totaling $33,300; 2) increased interest income of $183,200 or 57.4%
due to the increase in rates as stated above and 3) an increase in income from
the Partnership's equity investment in the joint venture which owns Holiday of
approximately $77,300. Partially offsetting the increase in net income for the
six month periods under comparison was increased general and administrative
expenses of approximately $4,300 or 3.9% due to an increase in professional
fees and printing and mailing costs.
For purposes of the following comparative discussion, the operating results of
Wellington C have been excluded.
Rental revenues decreased by approximately $15,600 and $500, respectively, for
the quarter and six months ended June 30, 1995 when compared to the quarter and
six months ended June 30, 1994. The primary factors which caused the decrease
in rental revenues were lower tenant expense reimbursements as a result of an
overestimate of prior year billings, a decrease
in parking lot income in 1995 and the recognition of security deposits as
income in 1994 at Park Plaza. Partially offsetting the decrease in rental
revenues were increased rental revenues at Ellis and Southwest Freeway due to
an increase in occupancy.
Real estate tax expense increased by approximately $6,500 or 8.9% and $12,800
or 8.8%, respectively, for the quarter and six months ended June 30, 1995 when
compared to the quarter and six months ended June 30, 1994. The increase in
real estate tax expense was primarily due to a projected increase in the
property valuation and tax rate at Park Plaza, partially offset by a decrease
at Ellis as a result of a lower estimated liability in 1995 when compared to
1994.
Repairs and maintenance expense decreased approximately $13,400 or 12% and
$13,100 or 6.4%, respectively, for the quarter and six months ended June 30,
1995 when compared to the quarter and six months ended June 30, 1994. The
primary factor which caused the decrease was a reduction in salaries to
maintenance personnel at Park Plaza.
Property operating expenses decreased by approximately $5,500 or 2.9% and
$20,600 or 5.3%, respectively, for the comparable periods. The primary property
operating expenses that decreased were management fees, leasing costs and
utilities at Park Plaza and lower utilities at Southwest Freeway.
5
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
To increase and or maintain occupancy levels at the Partnership's properties,
the General Partner, through its Affiliated asset and property management
groups, continues to take the necessary actions deemed appropriate for the
properties discussed above. Some of these actions include: 1) implementation of
marketing programs, including hiring of third-party leasing agents or providing
on-site leasing personnel, advertising, direct mail campaigns and development
of building brochures; 2) early renewal of existing tenants and addressing any
expansion needs these tenants may have; 3) promotion of local broker events and
networking with local brokers; 4) networking with national level retailers; 5)
cold-calling other businesses and tenants in the market area and 6) providing
rental concessions or competitively pricing rental rates depending on market
conditions.
LIQUIDITY AND CAPITAL RESOURCES
One of the Partnership's objectives is to dispose of its properties when market
conditions allow for the achievement of the maximum possible sales price. In
the interim, the Partnership continues to manage and maintain its three
remaining properties and investment in joint venture. Notwithstanding the
Partnership's intention relative to property sales, another primary objective
of the Partnership is to provide cash distributions to Limited Partners from
Partnership operations. To the extent cumulative cash distributions exceed net
income, such excess distributions will be treated as a return of capital. Cash
Flow (as defined in the Partnership Agreement) is generally not equal to
Partnership net income or cash flows as defined by generally accepted
accounting principles ("GAAP"), since certain items are treated differently
under the Partnership Agreement than under GAAP. Management believes that to
facilitate a clear understanding of the Partnership's operations, an analysis
of Cash Flow (as defined by the Partnership Agreement) should be examined in
conjunction with an analysis of net income or cash flows as defined by GAAP.
The following table includes a reconciliation of Cash Flow (as defined by the
Partnership Agreement) to cash flow provided by operating activities as
determined by GAAP and are not indicative of actual distributions to Partners
and should not necessarily be considered as an alternative to the results
disclosed in the Statements of Income and Expenses and Cash Flow.
<TABLE>
<CAPTION>
Comparative Cash Flow
Results For the Six
Months Ended
6/30/95 6/30/94
----------------------------------------------------------------------------
<S> <C> <C>
Amount of Cash Flow (as defined in the Partnership
Agreement) $ 1,202,900 $1,132,000
Items of reconciliation:
Income from participation in joint venture 190,800 113,500
Distributions from joint venture (170,000) (244,700)
Decrease in current assets 4,000 54,700
(Decrease) in current liabilities (46,300) (211,500)
----------------------------------------------------------------------------
Net cash provided by operating activities $ 1,181,400 $ 844,000
----------------------------------------------------------------------------
Net cash provided by investing activities $ 21,000 $2,029,700
----------------------------------------------------------------------------
Net cash (used for) financing activities $(1,195,700) $ (406,000)
----------------------------------------------------------------------------
</TABLE>
The increase in Cash Flow (as defined by the Partnership Agreement) of
approximately $70,900 for the six months ended June 30, 1995 when compared to
six months ended June 30, 1994 was primarily due to the increase in net income,
as previously discussed, exclusive of depreciation and amortization.
The Partnership's cash position remained stable as of June 30, 1995 when
compared to December 31, 1994, due to cash flow provided by operating
activities and distributions received from joint venture in excess of income
allocated exceeding distributions paid to Partners and payments made for
capital and tenant improvements. Liquid assets of the Partnership are comprised
of amounts held for working capital purposes.
The increase in net cash provided by operating activities of approximately
$337,400 for the six months ended June 30, 1995 when compared to the six months
ended June 30, 1994 was primarily due to the increase in net income, as
previously discussed, and an increase in income from participation in joint
venture, partially offset by the timing of the collection of tenant's rental
payments and payment of certain Partnership's expenses.
The decrease in net cash provided by investing activities of $2,008,700 for the
six months ended June 30, 1995 when compared to the six months ended June 30,
1994, was primarily due to the net proceeds received from the sale of Norwest
on June 8, 1994. Also affecting the change in net cash provided by investing
activities was the decrease in payments made for capital and tenant
improvements to the Partnership's properties.
During the six months ended June 30, 1995, the Partnership spent $74,800 for
building and tenant improvements and has budgeted to spend an approximately
$347,000 during the remainder of 1995. Of the remaining budgeted amount,
approximately $175,000 and $140,000 relates to anticipated capital and tenant
improvements and leasing costs expected to be incurred at Park Plaza and Ellis,
respectively. In addition, $500,000 is budgeted for capital and tenant
improvements for the Partnership's joint venture investment in Holiday. The
General Partner believes these expenditures are necessary to maintain occupancy
levels in very competitive markets and ready the remaining properties for
disposition.
The increase in net cash (used for) financing activities was $789,700 for the
six months ended June 30, 1995 when compared to the six months ended June 30,
1994 was due primarily to an increase in distributions paid to Partners.
The General Partner continues to take a conservative approach to projections of
future rental income and to maintain high levels of cash reserves due to the
anticipated capital and tenant improvements necessary to be made at the
Partnership's properties during the next several years. The Partnership
utilized approximately $93,000 of previously undistributed Cash Flow (as
defined by the Partnership Agreement) for a portion of the funds to be
distributed to the Partners subsequent to June 30, 1995.
Distributions to Limited Partners for the quarter ended June 30, 1995 were
declared in the amount of $13.00 per Unit. Cash distributions are made 60 days
after quarter end. The amount of future distributions to Limited Partners will
ultimately be dependent upon the performance of the Partnership's investments,
as well as the amount of cash retained in the future to supplement working
capital reserves. Accordingly, there can be no assurance of the availability of
cash for distribution to Partners.
6
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K:
(a) Exhibits: Financial Data Schedule
(b) Reports on Form 8-K:
There were no reports filed on Form 8-K during the quarter ended
June 30, 1995.
<PAGE>
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.
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 3
BY: FIRST CAPITAL FINANCIAL CORPORATION
GENERAL PARTNER
Date: August 14, 1995 By: /s/ DOUGLAS CROCKER II
--------------- ---------------------------------------------
DOUGLAS CROCKER II
President and Chief Executive Officer
Date: August 14, 1995 By: /s/ NORMAN M. FIELD
--------------- ---------------------------------------------
NORMAN M. FIELD
Vice President - Finance and Treasurer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<CIK> 0000757528
<NAME> FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD - 3
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<EXCHANGE-RATE> 1
<CASH> 8,449,600
<SECURITIES> 0
<RECEIVABLES> 33,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 8,482,600
<PP&E> 20,696,700
<DEPRECIATION> 5,439,500
<TOTAL-ASSETS> 29,686,500
<CURRENT-LIABILITIES> 1,090,100
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 28,551,200
<TOTAL-LIABILITY-AND-EQUITY> 29,686,500
<SALES> 0
<TOTAL-REVENUES> 1,543,900
<CGS> 0
<TOTAL-COSTS> 714,700
<OTHER-EXPENSES> 115,200
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 808,300
<INCOME-TAX> 0
<INCOME-CONTINUING> 808,300
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 808,300
<EPS-PRIMARY> 14.84
<EPS-DILUTED> 14.84
</TABLE>
