FORM 10-QSB--QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
QUARTERLY OR TRANSITIONAL REPORT
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 1998
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from.........to.........
Commission file number 0-14369
SHELTER PROPERTIES VII LIMITED PARTNERSHIP
(Exact name of small business issuer as specified in its charter)
South Carolina 57-0784852
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
55 Beattie Place, P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 .
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a)
SHELTER PROPERTIES VII LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEET
(in thousands, except unit data)
(Unaudited)
September 30, 1998
Assets
Cash and cash equivalents $1,041
Receivables and deposits 199
Restricted escrows 90
Other assets 150
Investment properties:
Land $ 1,774
Buildings and related personal property 20,082
21,856
Less accumulated depreciation (10,538) 11,318
$12,798
Liabilities and Partners' Capital (Deficit)
Liabilities
Accounts payable $ 35
Tenant security deposit liabilities 75
Accrued property taxes 184
Other liabilities 115
Mortgage notes payable 10,979
Partners' Capital (Deficit)
General partners $ (132)
Limited partners (17,343 units
issued and outstanding) 1,542 1,410
$12,798
See Accompanying Notes to Consolidated Financial Statements
b)
SHELTER PROPERTIES VII LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
Revenues:
Rental income $ 946 $ 915 $2,809 $2,649
Other income 53 48 153 129
Casualty gain -- 28 -- 28
Total revenues 999 991 2,962 2,806
Expenses:
Operating 439 463 1,113 1,195
General and administrative 40 32 118 100
Depreciation 217 204 632 590
Interest 221 224 668 678
Property taxes 59 45 184 136
Casualty loss -- 43 -- 43
Total expenses 976 1,011 2,715 2,742
Net income (loss) $ 23 $ (20) $ 247 $ 64
Net income (loss) allocated
to general partners (1%) $ -- $ -- $ 2 $ 1
Net income (loss) allocated
to limited partners (99%) 23 (20) 245 63
$ 23 $ (20) $ 247 $ 64
Net income (loss) per limited
partnership unit $ 1.33 $(1.15) $14.13 $ 3.63
Distribution per limited
partnership unit $ -- $ -- $17.53 $ --
See Accompanying Notes to Consolidated Financial Statements
c)
SHELTER PROPERTIES VII LIMITED PARTNERSHIP
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(in thousands, except unit data)
(Unaudited)
Limited
Partnership General Limited
Units Partners Partners Total
Original capital contributions 17,343 $ 2 $17,343 $17,345
Partners' capital (deficit)
at December 31, 1997 17,343 $(134) $ 1,297 $ 1,163
Net income for the nine months
ended September 30, 1998 -- 2 245 247
Partners' capital (deficit)
at September 30, 1998 17,343 $(132) $ 1,542 $ 1,410
See Accompanying Notes to Consolidated Financial Statements
d)
SHELTER PROPERTIES VII LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
Nine Months Ended
September 30,
1998 1997
Cash flows from operating activities:
Net income $ 247 $ 64
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 632 590
Amortization of discounts and loan costs 33 31
Casualty gain -- (28)
Loss on disposal of property -- 43
Change in accounts:
Receivables and deposits 99 31
Other assets 28 8
Accounts payable (62) 48
Tenant security deposit liabilities (3) (6)
Accrued property taxes -- (40)
Other liabilities 11 (58)
Net cash provided by operating activities 985 683
Cash flows from investing activities:
Property improvements and replacements (409) (641)
Deposits to restricted escrows (3) (3)
Insurance proceeds received -- 52
Net cash used in investing activities (412) (592)
Cash flows from financing activities:
Payments on mortgage notes payable (144) (133)
Distribution to partners -- (304)
Net cash used in financing activities (144) (437)
Net increase (decrease) in cash and cash equivalents 429 (346)
Cash and cash equivalents at beginning of period 612 1,055
Cash and cash equivalents at end of period $1,041 $ 709
Supplemental disclosure of cash flow information:
Cash paid for interest $ 637 $ 647
See Accompanying Notes to Consolidated Financial Statements
e)
SHELTER PROPERTIES VII LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements of Shelter
Properties VII (the "Partnership") have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-QSB and Article 310(b) of Regulation S-B.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of Shelter Realty VII Corporation (the "Corporate General
Partner"), all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for the
three and nine month periods ended September 30, 1998, are not necessarily
indicative of the results that may be expected for the fiscal year ending
December 31, 1998. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Partnership's annual report on
Form 10-KSB for the year ended December 31, 1997.
Certain reclassifications have been made to the 1997 information to conform to
the 1998 presentation.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements of the Partnership include its one 99%
owned partnership. The Partnership may remove the General Partner of the
consolidated partnership; therefore, the consolidated partnership is deemed
controlled and consolidated by the Partnership. All significant
interpartnership balances have been eliminated.
NOTE B - RECONCILIATION OF CASH FLOWS
The following is a reconciliation of the subtotal on the accompanying statements
of cash flows captioned "net cash provided by operating activities" to "net cash
used in operations," as defined in the Partnership Agreement. However, "net
cash used in operations" should not be considered an alternative to net income
as an indicator of the Partnership's operating performance or to cash flows as a
measure of liquidity.
Nine months Ended
September 30,
(in thousands)
1998 1997
Net cash provided by operating activities $ 985 $ 683
Payments on mortgage notes payable (144) (133)
Property improvements and replacements (409) (641)
Change in restricted escrows, net (3) (3)
Changes in reserves for net operating
liabilities (73) 17
Additional reserves (356) --
Net cash used in operations $ -- $ (77)
At September 30, 1998, the Corporate General Partner believes it to be in the
best interest of the Partnership to reserve an additional $356,000 to fund
maintenance items and capital improvements at both properties.
NOTE C - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has no employees and is dependent on the Corporate General
Partner and its affiliates for the management and administration of all
partnership activities. The Corporate General Partner is wholly-owned by
Insignia Properties Trust ("IPT"). The Partnership Agreement provides for
payments to affiliates for services and as reimbursement of certain expenses
incurred by affiliates on behalf of the Partnership. The following amounts were
paid or accrued to the Corporate General Partner and affiliates in 1998 and
1997:
Nine months Ended
September 30,
1998 1997
(in thousands)
Property management fees (included in operating $146 $137
expenses)
Reimbursement for services of affiliates
(included in operating and general and
administrative expenses (1) 71 104
(1) Included in "Reimbursements for services of affiliates" for the nine months
ended September 30, 1998 and 1997 is approximately $5,000 and $45,000,
respectively, in reimbursements for construction oversight costs.
For the period of January 1, 1997 to August 31, 1997, the Partnership insured
its properties under a master policy through an agency affiliated with the
Corporate General Partner with an insurer unaffiliated with the Corporate
General Partner. An affiliate of the Corporate General Partner acquired, in the
acquisition of a business, certain financial obligations from an insurance
agency which was later acquired by the agent who placed the master policy. The
agent assumed the financial obligations to the affiliate of the Corporate
General Partner, which receives payment on these obligations from the agent.
The amount of the Partnership's insurance premiums accruing to the benefit of
the affiliate of the Corporate General Partner by virtue of the agent's
obligations is not significant.
During December 1997, an affiliate of the Corporate General Partner (the
"Purchaser") commenced a tender offer for limited partnership interests in the
Partnership. The Purchaser offered to purchase up to 7,000 of the outstanding
units of limited partnership interest in the Partnership at $350 per Unit, net
to the seller in cash. During February 1998, the tender offers were completed
and the Purchaser tendered 2,180 units of limited partnership interest in the
Partnership.
On July 21, 1998, the Purchaser commenced an additional tender offer for limited
partnership interests in the Partnership. The Purchaser offered to purchase up
to 6,000 of the outstanding units of limited partnership interest in the
Partnership, at $450 per Unit, net to the seller in cash. During August 1998,
the tender offers were completed and the Purchaser acquired 1,450 units of
limited partnership interest in the Partnership.
NOTE D - CASUALTY LOSS
During the nine months ended September 30, 1997, the Partnership recorded a
$43,000 casualty loss on disposal of property that relates to roof write-offs on
both of the Partnership's investment properties. During the nine months ended
September 30, 1997, the Partnership also recorded a $28,000 casualty gain
relating to hail damage at Governor's Park Apartments. The hail damage occurred
in 1996; however, the expenses were incurred during the nine months ended
September 30, 1997. The insurance proceeds were received during the nine months
ended September 30, 1997.
NOTE E - TRANSFER OF CONTROL; SUBSEQUENT EVENT
On October 1, 1998, Insignia Financial Group, Inc. completed its merger with and
into Apartment Investment and Management Company ("AIMCO"), a publicly traded
real estate investment trust, with AIMCO being the surviving corporation (the
"Insignia Merger"). As a result of the Insignia Merger, AIMCO acquired control
of the Corporate General Partner. In addition, AIMCO also acquired
approximately 51% of the outstanding common shares of beneficial interest of
IPT. Also, effective October 1, 1998 IPT and AIMCO entered into an Agreement
and plan of Merger pursuant to which IPT is to be merged with and into AIMCO or
a subsidiary of AIMCO (the "IPT Merger"). The IPT Merger requires the approval
of the holders of a majority of the outstanding IPT Shares. AIMCO has agreed to
vote all of the IPT Shares owned by it in favor of the IPT Merger and has
granted an irrevocable limited proxy to unaffiliated representatives of IPT to
vote the IPT Shares acquired by AIMCO and its subsidiaries in favor of the IPT
Merger. As a result of AIMCO's ownership and its agreement, the vote of no
other holder of IPT is required to approve the merger. The Corporate
General Partner does not believe that this transaction will have a material
effect on the affairs and operations of the Partnership.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's investment properties consist of two apartment complexes. The
following table sets forth the average occupancy of the properties for the nine
months ended September 30, 1998 and 1997:
Average
Occupancy
1998 1997
Hickory Ridge Apartments
Memphis, Tennessee 95% 90%
Governor's Park Apartments
Ft. Collins, Colorado 96% 95%
The Corporate General Partner attributes the increase in occupancy at Hickory
Ridge to increased curb appeal as a result of the completion of an exterior
building improvement project in 1997. In addition, the increase is also
attributable to an increase in employment at two large area employers.
Results of Operations
The partnership reported net income of approximately $23,000 and $247,000,
respectively for the three months and nine months ended September 30, 1998. The
partnership reported net (loss) income of approximately $(20,000) and $64,000,
respectively for the three and nine months ended September 30, 1997. The
increase in net income for both periods is attributable to increases in rental
income, other income and a decrease in operating expenses. Rental income
increased at both Governor's Park and Hickory Ridge as a result of rental rate
increases and an increase in average occupancy at both properties as discussed
above. Other income increased primarily due to increases in late charges and
cleaning and damage fees at Hickory Ridge. Operating expenses decreased as a
result of building improvements and property appearance costs and repairs which
were completed in 1997 at both properties.
The increase in net income was partially offset by an increase in property taxes
and depreciation expense. Property taxes increased due to an increase in the
assessed value at Hickory Ridge Apartments during 1998. Depreciation expense
increased due to an increase in depreciable assets.
Included in operating expense for the nine months ended September 30, 1998 is
approximately $57,000 of major repairs and maintenance comprised of exterior
building improvements, major landscaping, gutter repairs, and construction
services. Included in operating expense for the nine months ended September 30,
1997 is approximately $109,000 of major repairs and maintenance comprised of
exterior building improvements, parking lot repairs, construction services and
tennis court repairs.
As part of the ongoing business plan of the Partnership, the Corporate General
Partner monitors the rental market environment of each of its investment
properties to assess the feasibility of increasing rents, maintaining or
increasing occupancy levels and protecting the Partnership from increases in
expense. As part of this plan, the Corporate General Partner attempts to
protect the Partnership from the burden of inflation-related increases in
expenses by increasing rents and maintaining a high overall occupancy level.
However, due to changing market conditions, which can result in the use of
rental concessions and rental reductions to offset softening market conditions,
there is no guarantee that the Corporate General Partner will be able to sustain
such a plan.
Liquidity and Capital Resources
At September 30, 1998, the Partnership had cash and cash equivalents of
approximately $1,041,000 compared to approximately $709,000 for September 30,
1997. The net increase (decrease) in cash and cash equivalents for the nine
months ended September 30, 1998 and 1997 is $429,000 and $(346,000),
respectively. Net cash provided by operating activities increased due to an
increase in net income as discussed above, an increase in other liabilities, and
a decrease in receivables and deposits. These changes were partially offset by a
decrease in accounts payable due to the timing of payments. The increase in
other liabilities is the result of a decrease in deferred income during the nine
months ended September 30, 1997. The decrease in accounts receivables and
deposits is a result of improved collections and the receipt of refunds due the
Partnership at the end of 1997. Net cash used in investing activities decreased
due to a decrease in property improvements and replacements in 1998 as compared
to 1997. This decrease was partially offset by the absence of any insurance
proceeds in 1998. Net cash used in financing activities decreased due to a
decrease in distributions to partners in 1998 as compared to 1997.
The Corporate General Partner has budgeted $151,000 in 1998 for parking area
repair and overlay and roof repairs at Hickory Ridge Apartments, which are to be
funded from operations and Partnership reserves. This work is approximately
two-thirds complete as of September 30, 1998. The Partnership has no other
material capital programs scheduled to be performed in 1998, although certain
routine capital expenditures and maintenance expenses will be incurred only if
cash is available from operations or is received from the capital reserve
account.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the various properties to adequately maintain the
physical assets and other operating needs of the Partnership and to comply with
federal, state and local legal and regulatory requirements. Such assets are
currently thought to be sufficient for any near-term needs of the Partnership.
The General Partner is currently assessing the need for capital improvements at
each of the Partnership's properties. To the extent that additional capital
improvements are required, the Partnership's distributable cash flow, if any,
may be adversely affected at least in the short term. The mortgage indebtedness
of approximately $10,979,000, net of discount, is amortized over varying periods
with required balloon payments ranging from March 1, 2001, to October 15, 2003.
The General Partner will attempt to refinance such remaining indebtedness or
sell the properties prior to such maturity dates. If the properties cannot be
refinanced or sold for a sufficient amount, the Partnership will risk losing
such properties through foreclosure. In May 1997, the Partnership distributed
approximately $300,000 ($17.53 per limited partnership unit) to the limited
partners and in April 1997, the Partnership paid approximately $4,000 to
Colorado for state tax withholdings on behalf of the limited partners. Future
cash distributions will depend on the levels of net cash generated from
operations, refinancings, property sales and the availability of cash reserves.
The Partnership's distribution policy will be reviewed on a quarterly basis.
There can be no assurance, however, that the Partnership will generate
sufficient funds from operations to permit distributions to its partners in 1998
or subsequent periods.
Transfer of Control; Subsequent Event
On October 1, 1998, Insignia Financial Group, Inc. completed its merger with and
into Apartment Investment and Management Company ("AIMCO"), a publicly traded
real estate investment trust, with AIMCO being the surviving corporation (the
"Insignia Merger"). As a result of the Insignia Merger, AIMCO acquired control
of the Corporate General Partner. In addition, AIMCO also acquired
approximately 51% of the outstanding common shares of beneficial interest of
Insignia Properties Trust ("IPT"), the sole shareholder of the Corporate General
Partner. Also, effective October 1, 1998 IPT and AIMCO entered into an
Agreement and Plan of Merger pursuant to which IPT is to be merged with and into
AIMCO or a subsidiary of AIMCO (the "IPT Merger"). The IPT Merger requires the
approval of the holders of a majority of the outstanding IPT Shares. AIMCO has
agreed to vote all of the IPT Shares owned by it in favor of the IPT Merger and
has granted an irrevocable limited proxy to unaffiliated representatives of IPT
to vote the IPT Shares acquired by AIMCO and its subsidiaries in favor of the
IPT Merger. As a result of AIMCO's ownership and its agreement, the vote of no
other holder of IPT is required to approve the merger. The Corporate General
Partner does not believe that this transaction will have a material effect on
the affairs and operations of the Partnership.
Year 2000
General Description of the Year 2000 Issue and the Nature and Effects of the
Year 2000 on Information Technology (IT) and Non-IT Systems
The Year 2000 Issue is the result of computer programs being written using two
digits rather than four to define the applicable year. The Partnership is
dependent upon the Corporate General Partner and its affiliates for management
and administrative services ("Managing Agent"). Any computer programs or
hardware that have date-sensitive software or embedded chips may recognize a
date using "00" as the year 1900 rather than the year 2000. This could result
in a system failure or miscalculations causing disruptions of operations,
including, among other things, a temporary inability to process transactions,
send invoices, or engage in similar normal business activities.
The Managing Agent has determined that it will be required to modify or replace
significant portions of its software and certain hardware so that those systems
will properly utilize dates beyond December 31, 1999. The Managing Agent
presently believes that with modifications or replacements of existing software
and certain hardware, the Year 2000 Issue can be mitigated. However, if such
modifications and replacements are not made, or are not completed timely, the
Year 2000 Issue could have a material impact on the operations of the Managing
Agent and the Partnership.
Status of Progress in Becoming Year 2000 Compliant
The Managing Agent's plan to resolve the Year 2000 Issue involves the following
four phases: assessment, remediation, testing and implementation. To date, the
Managing Agent has fully completed its assessment of all information systems
that could be significantly affected by the Year 2000, and has begun the
remediation, testing and implementation phase on both hardware and software
systems. Assessments are continuing in regards to embedded systems in operating
equipment. The Managing Agent anticipates having all phases complete by June 1,
1999.
In addition to the areas the Partnership is relying on the Managing Agent to
verify compliance with, the Partnership has certain operating equipment,
primarily at the property sites, which needed to be evaluated for Year 2000
compliance. The focus of the Corporate General Partner was to the security
systems, elevators, heating-ventilation-air-conditioning systems, telephone
systems and switches, and sprinkler systems. The Corporate General Partner is
currently engaged in the identification of all non-compliant operational
systems, and is in the process of estimating the costs associated with any
potential modifications or replacements needed to such systems in order for them
to be Year 2000 compliant. It is not expected that such costs would have a
material adverse affect upon the operations of the Partnership.
Risk Associated with the Year 2000
The Corporate General Partner believes that the Managing Agent has an effective
program in place to resolve the Year 2000 issue in a timely manner and has
appropriate contingency plans in place for critical applications that could
affect the Partnership's operations. To date, the Corporate General Partner
is not aware of any external agent with a Year 2000 issue that would materially
impact the Partnership's results of operations, liquidity or capital resources.
However, the Corporate General Partner has no means of ensuring that external
agents will be Year 2000 compliant. The Corporate General Partner does not
believe that the inability of external agents to complete their Year 2000
resolution process in a timely manner will have a material impact on the
financial position or results of operations of the Partnership. However, the
effect of non-compliance by external agents is not readily determinable.
Other
Certain items discussed in this quarterly report may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995 (the "Reform Act") and as such may involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
or achievements of the Partnership to be materially different from any future
results, performance or achievements expressed or implied by such forward-
looking statements. Such forward-looking statements speak only as of the date
of this quarterly report. The Partnership expressly disclaims any obligation or
undertaking to release publicly any updates of revisions to any forward-looking
statements contained herein to reflect any change in the Partnership's
expectations with regard thereto or any change in events, conditions or
circumstances on which any such statement is based.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDING
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia
Financial Group, Inc., et al. in Superior Court of the State of California for
the County of San Mateo. The Plaintiffs named as defendants, among others, the
Partnership, the General Partner and several of their affiliated partnerships
and corporate entities. The complaint purports to assert claims on behalf of a
class of limited partners and derivatively on behalf of a number of limited
partnerships (including the Partnership) which are named as nominal defendants,
challenging the acquisition by Insignia Financial Group, Inc, ("Insignia") and
entities which were, at the time, affiliates of Insignia ("Insignia Affiliates")
of interests in certain general partner entities, past tender offers by Insignia
Affiliates to acquire limited partnership units, the management of partnerships
by Insignia Affiliates as well as a recently announced agreement between
Insignia and Apartment Investment and Management Company. The complaint seeks
monetary damages and equitable relief, including judicial dissolution of the
Partnership. On June 25, 1998, the Corporate General Partner filed a motion
seeking dismissal of the action. In lieu of responding to the motion, the
plaintiffs have filed an amended complaint. The Corporate General Partner has
filed demurrers to the amended complaint which are scheduled to be heard on
January 8, 1999. The Corporate General Partner believes the action to be without
merit, and intends to vigorously defend it.
On July 30, 1998, certain entities claiming to own limited partnership interests
in certain limited partnerships whose general partners were, at the time,
affiliates of Insignia filed a complaint entitled Everest Properties, LLC. v.
Insignia Financial Group, Inc., et al. in the Superior Court of the State of
California, County of Los Angeles. The action involves 44 real estate limited
partnerships (including the Partnership) in which the plaintiffs allegedly own
interests and which Insignia Affiliates allegedly manage or control (the
"Subject Partnerships"). The complaint names as defendants Insignia, several
Insignia Affiliates alleged to be managing partners of the Subject Partnerships,
the Partnership and the Corporate General Partner. Plaintiffs allege that they
have requested from, but have been denied by each of the Subject Partnerships,
lists of their respective limited partners for the purpose of making tender
offers to purchase up to 4.9% of the limited partner units of each of the
Subject Partnerships. The complaint also alleges that certain of the defendants
made tender offers to purchase limited partner units in many of the Subject
Partnerships, with the alleged result that plaintiffs have been deprived of the
benefits they would have realized from ownership of the additional units. The
plaintiffs assert eleven causes of action, including breach of contract, unfair
business practices, and violations of the partnership statutes of the states in
which the Subject Partnerships are organized. Plaintiffs seek compensatory,
punitive and treble damages. The Corporate General Partner filed an answer to
the complaint on September 15, 1998. The Corporate General Partners believes the
claims to be without merit and intends to defend the action vigorously.
The Partnership is unaware of any other pending or outstanding litigation that
is not of a routine nature. The Corporate General Partner of the Partnership
believes that all such pending or outstanding litigation will be resolved
without a material adverse effect upon the business, financial condition, or
operations of the Partnership.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit to
this report.
b) Reports on Form 8-K:
None filed during the quarter ended September 30, 1998.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
SHELTER PROPERTIES VII LIMITED PARTNERSHIP
By:Shelter Realty VII Corporation
Corporate General Partner
By:/s/ Patrick Foye
Patrick Foye
Executive Vice President
By:/s/ Timothy R. Garrick
Timothy R. Garrick
Vice President - Accounting
(Duly Authorized Officer)
Date: November 16, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
Shelter Properties VII Limited Partnership 1998 Third Quarter 10-QSB and is
qualified in its entirety by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000758009
<NAME> SHELTER PROPETIES VII LIMITED PARTNERSHIP
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 1,041
<SECURITIES> 0
<RECEIVABLES> 199
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 21,856
<DEPRECIATION> (10,538)
<TOTAL-ASSETS> 12,798
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 10,979
0
0
<COMMON> 0
<OTHER-SE> 1,410
<TOTAL-LIABILITY-AND-EQUITY> 12,798
<SALES> 0
<TOTAL-REVENUES> 2,962
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,715
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 668
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 247
<EPS-PRIMARY> 17.53<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>
</TABLE>
