SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For Quarter Ended March 31, 1996 Commission File Number: 0-14453
National Real Estate Limited Partnership Income Properties
(Exact name of registrant as specified in its charter)
Wisconsin
(State or other jurisdiction ofincorporation or organization)
39-1503893
(I.R.S. Employer Identification Number)
9800 West Bluemound Road
Wauwatosa, Wisconsin 53226-4353
(Address of principal executive offices)
(zip code)
Registrant's telephone number, including area code:
(414) 453-3498
N/A
Former name, address and fiscal year if changed since last
report.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 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.
( X ) Yes ( ) No
<PAGE>
NATIONAL REAL ESTATE LIMITED PARTNERSHIP
INCOME PROPERTIES
INDEX
Page
PART I. FINANCIAL INFORMATION
Balance Sheet (unaudited) - March 31, 1996
and December 31, 1995. . . . . . . . . . . . . . . . .2
Statement of Operations (unaudited) -
Three months ended
March 31, 1996 and 1995. . . . . . . . . . . . . . . .3
Statements of Cash Flows (unaudited) -
Three months ended March 31, 1996 and 1995. . . . . .4
Notes to Financial Statements (unaudited) . . . . . . . .5-6
Management's Discussion and Analysis of
Financial Condition and Results of Operation . . . .7-8
PART II. OTHER INFORMATION AND SIGNATURES. . . . . . . . . . 9-10
<PAGE>
PART I. FINANCIAL INFORMATION
NATIONAL REAL ESTATE LIMITED PARTNERSHIP - IP
(A Wisconsin Limited Partnership)
Balance Sheet
(Unaudited)
March 31 December 31,
1996 1995
ASSETS
Current Assets
Cash $ 663,549 $ 599,315
Escrow deposits and other assets (Note 4)
3,395 10,032
Other Assets
Investment properties, at cost
Land 1,267,695 1,267,695
Buildings and improvements
6,018,409 6,018,410
7,286,105 7,286,105
Less accumulated depreciation
1,973,869 1,922,692
5,312,236 5,363,413
$ 5,979,180 $ 5,972,760
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Tenant security deposits
$ 5,454 $ 5,454
Rents received in advance
31,415 32,343
Accrued interest payable to Individual General Partner
451,930 433,571
Accrued expenses and other liabilities
88,237 86,345
Note payable to Individual General
Partner (Note 6) 271,020 271,020
848,056 828,733
Partners' Capital (deficiency) (Note 5):
General Partners $ (86,202) $ (85,815)
Limited Partners (authorized--10,000
Interests; outstanding--9,034.01 Interests)
5,238,997 5,251,513
Less 29.86 Interests held in Treasury
(21,671) (21,671)
5,131,124 5,144,027
$ 5,979,180 $ 5,972,760
See notes to financial statements.
<PAGE>
NATIONAL REAL ESTATE LIMITED PARTNERSHIP - IP
(A Wisconsin Limited Partnership)
Statement of Operations
(Unaudited)
Three months ended
March 31,
1996 1995
INCOME
Operating income $ 246,843 $ 208,169
Other income 12,307 10,221
Total Income 259,150 218,390
OPERATING EXPENSES
Property operating expenses 118,274 101,412
Depreciation and amortization 51,177 51,102
Interest expense 18,359 17,282
Administrative expense 48,597 49,981
Total Expenses 236,407 219,777
Income(Loss) from operations 22,743 (1,387)
Other Income (expenses)
Interest income 10,767 8,028
Net Income (Loss) $ 33,510 $ 6,641
Net Income (Loss) attributable to
General Partners (3%) $ 1,005 $ 199
Net Income (Loss) attributable to
Limited Partners (97%) $ 32,505 $ 6,442
Per Limited Partnership Interest
Outstanding--9,004.15 Interests
$ 3.61 $ 0.72
See notes to financial statements.
<PAGE>
NATIONAL REAL ESTATE LIMITED PARTNERSHIP - IP
(A Wisconsin Limited Partnership)
Statement of Cash Flows
(Unaudited)
Three Months Ended
March 31,
1996 1995
Operating Activities
Net income (loss) for the period
$ 33,510 $ (14,647)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation 51,177 49,984
Changes in operating assets and
liabilities:
Escrow deposits & other assets
6,637 (20,811)
Tenant security deposits
0 0
Rents received in advance
(928) (3,439)
Accrued expenses and other liabilities
20,251 26,331
NET CASH PROVIDED BY (USED IN)
110,648 37,418
OPERATING ACTIVITIES
Investing activities:
Additions to investment property
(0) (1,415)
Financing activities:
Distributions to partners
(46,413) (32,489)
INCREASE (DECREASE) IN CASH
64,235 3,514
Cash at beginning of period
409,508 304,845
CASH AT END OF PERIOD
$ 473,743 $ 308,359
See notes to financial statements.
<PAGE>
NATIONAL REAL ESTATE LIMITED PARTNERSHIP INCOME PROPERTIES
(A Wisconsin Limited Partnership)
Notes to Financial Statements
(Unaudited)
March 31, 1996
1. In the opinion of the General Partners, the accompanying
unaudited financial statements contain all adjustments
(consisting of normal recurring accruals) which are
necessary for a fair presentation. The statements, which do
not include all of the information and footnotes required by
generally accepted accounting principles for complete
financial statements, should be read in conjunction with the
National Real Estate Limited Partnership Income Properties
annual report for the year ended December 31, 1995. Refer to
the footnotes of those statements for additional details on
the Partnership's financial condition. The operating results
for the period ended March 31, 1996, may not be indicative
of the operating results for the entire year.
2. National Real Estate Limited Partnership Income Properties
(the "Partnership") was organized under the Wisconsin
Uniform Limited Partnership Act pursuant to a Certificate of
Limited Partnership dated December 18, 1984, for the purpose
of investing in residential, commercial, and industrial real
properties. John Vishnevsky and National Development and
Investment, Inc., contributed the sum of $6,000 to the
Partnership as General Partners. The Limited Partnership
Agreement had authorized the issuance of 10,000 Limited
Partnership Interests (the "Interests") at $1,000 per
Interest with the offering period commencing January 31,
1985. Upon conclusion of the offering in December 1986, the
Partnership had raised $9,024,556 in capital representing
9,034.01 Interests.
3. National Realty Management, Inc. (NRMI): The Partnership
incurred property management fees of $13,601 under an
agreement with NRMI for the period presented.
4. Real estate taxes are charged to operations based on actual
taxes paid for the prior year and are adjusted for normal
annual increases. Taxes for Tucson Lock-It Lockers, Phoenix
Lock-It Lockers, Cave Creek Lock-It Lockers, and Northridge
Commons are being accrued monthly at $4,935, $2,074, $322,
and $3,451, respectively.
5. Changes in Partners' Equity:
LIMITED PARTNERS
Quarter Ended March 31, 1996
Partner's Equity, beginning of quarter $5,251,513
Distributions (45,021)
Net Income (Loss) 32,505
Partners' Equity, end of quarter $5,238,997
Limited Partner's equity is net of 29.86 interests held in
treasury of ($21,671).
Quarter Ended March 31, 1995
Partner's Equity, beginning of quarter $5,280,415
Distributions (31,515)
Net Income (Loss) (6,442)
Partners' Equity, end of quarter $5,255,342
Limited Partner's equity is net of 29.86 interests held in
treasury of ($21,671).
GENERAL PARTNERS
Quarter Ended March 31, 1996
Partner's Equity, beginning of quarter $(85,815)
Distributions (1,392)
Net Income (Loss) 1,005
Partners' Equity, end of quarter $(86,202)
Quarter Ended March 31, 1995
Partner's Equity, beginning of quarter $(84,252)
Distributions (974)
Net Income (Loss) 199
Partners' Equity, end of quarter $(85,027)
TOTAL
Quarter Ended March 31, 1996
Partner's Equity, beginning of quarter $5,165,698
Distributions (46,413)
Net Income (Loss) 33,510
Partners' Equity, end of quarter $5,152,795
Quarter Ended March 31, 1995
Partner's Equity, beginning of quarter $5,196,163
Distributions (32,489)
Net Income (Loss) 6,641
Partners' Equity, end of quarter $5,170,315
<PAGE>
National Real Estate Limited Partnership Income Properties
(A Wisconsin Limited Partnership)
Notes to Financial Statements (Cont.)
(Unaudited)
March 31, 1996
6. As outlined in the prospectus, the General Partners agreed
to make loans to the Partnership up to an aggregate of 3% of
the gross proceeds of the offering to the extent necessary
to provide distributions to the limited partners at
annualized rates equal to 8% in 1985, 8.25% in 1986, and
8.5% in 1987. The loan will be repaid solely from sales
proceeds, with compounding interest equal to the cost of
their funds or 12%, whichever is lower. As of March 31,
1996, interest totaling $451,930 has accrued.
7. Northridge Commons' tenants pay monthly fixed rent payments
plus estimated charges for taxes, costs of insurance
premiums, administrative costs, and operating expenses with
respect to common areas.
<PAGE>
NATIONAL REAL ESTATE LIMITED PARTNERSHIP INCOME PROPERTIES
(A Wisconsin Limited Partnership)
Management's Discussion and Analysis of
Financial Condition and Results of Operations
March 31, 1996
The Partnership currently owns and operates four investment
properties; Tucson Lock-It Lockers, a 49,885 net rentable square
foot mini warehouse complex in Tucson, Arizona; Phoenix Lock-It
Lockers, a 58,766 net rentable square foot mini warehouse complex
in Phoenix, Arizona; a portion of Cave Creek Lock-It Lockers
containing 8,236 of 46,028 net rentable square feet in Phoenix,
Arizona; and Northridge Commons, a 20,700 net rentable square
foot community shopping center in Milwaukee, Wisconsin.
Occupancy based upon net rentable square feet for the third
quarter averaged 98.4% for Tucson Lock-It Lockers; 97.5% for
Phoenix Lock-It Lockers; 100% for Northridge Commons; and 92.3%
for Cave Creek Lock-It Lockers. This compares to an average of
98.9% for Tucson Lock-It Lockers; 98.7% for Phoenix Lock-It
Lockers; 63.6% for Northridge Commons; and 98.2% for Cave Creek
Lock-It Lockers during the same period of 1995.
Rental rates were increased at Tucson, Phoenix, and Cave Creek
Lock-It Lockers in April 1995. Tucson Lock-It Lockers updated
landscaping and installed security lighting. Tucson Lock-It
Lockers updated landscaping and installed security lighting.
Future projects to be completed at Tucson Lock-It Lockers include
painting and additional asphalt work.
Upon the purchase of Cave Creek Lock-It Lockers, the Partnership
entered into master lease agreements with the Seller, Enterprise
Growth Group (EGG). The Partnership had been informed that EGG
had been funding the lease payments because cash flow from the
property had not been sufficient to cover them. EGG made only a
partial lease payment in August, 1991 for the July installment
and was delinquent in subsequent payments. The General Partners
officially notified EGG of their default on October 17, 1991.
Management of the property was turned over to National Realty
Management, Inc. on November 1, 1991 in order to ensure
maximization of net operating income to the Partnership. As of
early 1992, the master lease agreements expired. The Partnership
started legal proceedings relating to collection from EGG and its
principals.
Although Northridge Commons is currently at 100% occupancy,
vacancies continue to plague the surrounding retail shopping
area. Therefore Northridge Commons maintained the same base rent
as it did during the same period of 1995. Cellular One, a new
tenant in 1995, installed a new pylon sign. Tenants have
indicated an increase in activity due to the new sign. Talbots
remains as the anchor tenant and has done well since their
expansion in 1990.
During the first quarter of 1996 rental revenue for Tucson
Lock-It Lockers, Phoenix Lock-It Lockers, and Cave Creek Lock-It
Lockers increased compared to the first quarter of 1995 due to
increased rental rates. Also during the first quarter of 1996,
rental revenue for Northridge Commons increased compared to the
first quarter of 1995 due to a decrease in occupancy at
Northridge Commons.
Operating expenses during the first quarter of 1996 increased
compared to the operating expenses during the same quarter in
1995 due to maintenance costs at Tucson Lock-It.
<PAGE>
NATIONAL REAL ESTATE LIMITED PARTNERSHIP INCOME PROPERTIES
(A Wisconsin Limited Partnership)
Management's Discussion and Analysis of
Financial Condition and Results of Operations (Cont.)
March 31, 1996
The Partnership continued cash distributions to its partners with
distributions totaling $46,413 for the first quarter of 1996.
These distributions are required to be allocated 97% to Limited
Partners ($45,021) and 3% to the General Partners ($1,392).
<PAGE>
PART II. OTHER INFORMATION
Item 6(b). Reports on Form 8-K
There were no reports on Form 8-K for the quarter ended March 31,
1996.
<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.
National Real Estate Limited Partnership
Income Properties
(Registrant)
Date /S/May 15, 1996
/S/ John Vishnevsky
________________________________
John Vishnevsky
President and Chief Operating and
Executive Officer
National Development and Investment, Inc.
Corporate General Partner
Date /S/May 15, 1996
/S/ John Vishnevsky
__________________________________
John Vishnevsky
Chief Financial and Accounting Officer
Date /S/May 15, 1996
Stephen P. Kotecki
__________________________________
Stephen P. Kotecki
President
EC Corp
Corporate General Partner
F:\WPDOCS\LETTERS\NIP-1QTR.ELE
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<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 666944
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 666944
<PP&E> 7286105
<DEPRECIATION> 1973869
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<CURRENT-LIABILITIES> 848056
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 5131124<F1>
<TOTAL-LIABILITY-AND-EQUITY> 5979180
<SALES> 0
<TOTAL-REVENUES> 259150
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 218048
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 18359
<INCOME-TAX> 0
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<CHANGES> 0
<NET-INCOME> 33510
<EPS-PRIMARY> 3.61<F2>
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<FN>
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</FN>
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