<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTER ENDED SEPTEMBER 30, 1995
------------------
Commission File Number 1-9525
------
INCOME OPPORTUNITY REALTY TRUST
------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
California 94-6578120
- ---------------------------------- ------------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
10670 North Central Expressway, Suite 300, Dallas, Texas, 75231
- ---------------------------------------------------------------------------
(Address of Principal Executive Office) (Zip Code)
(214) 692-4700
------------------------------
(Registrant's Telephone Number,
Including Area Code)
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 .
--- ---
Shares of Beneficial Interest,
no par value 791,444
- ----------------------------- --------------------------------
(Class) (Outstanding at November 3, 1995)
1
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- -----------------------------
The accompanying Consolidated Financial Statements have not been examined by
independent certified public accountants, but in the opinion of the management
of Income Opportunity Realty Trust (the "Trust"), all adjustments (consisting
of normal recurring accruals) necessary for a fair presentation of the Trust's
consolidated financial position, consolidated results of operations and
consolidated cash flows at the dates and for the periods indicated, have been
included.
INCOME OPPORTUNITY REALTY TRUST
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
-------------- --------------
Assets (dollars in thousands)
------
<S> <C> <C>
Notes and interest receivable
Performing........................................ $ 1,983 $ 1,974
Real estate held for sale, net of accumulated
depreciation ($5,839 in 1995 and $5,055 in 1994).. 40,525 41,156
Less - allowance for estimated losses.............. (121) (121)
-------------- --------------
42,387 43,009
Investment in partnerships......................... 2,632 3,980
Cash and cash equivalents.......................... 297 232
Other assets (including $40 in 1995 and $44 in
1994 from affiliates)............................. 1,622 1,814
-------------- --------------
$ 46,938 $ 49,035
============== ==============
Liabilities and Shareholders' Equity
------------------------------------
Liabilities
Notes and interest payable......................... $ 20,284 $ 20,717
Other liabilities (including $92 in 1995 and $407
in 1994 to affiliates)............................ 2,449 2,746
-------------- --------------
22,733 23,463
Commitments and contingencies
Shareholders' equity
Shares of beneficial interest, no par value;
authorized shares, unlimited; issued and
outstanding, 791,444 shares....................... 3,347 3,347
Paid-in capital.................................... 62,093 62,093
Accumulated distributions in excess of accumulated
earnings.......................................... (41,235) (39,868)
-------------- --------------
24,205 25,572
-------------- --------------
$ 46,938 $ 49,035
============== ==============
</TABLE>
The accompanying notes are an integral part of these Consolidated Financial
Statements.
2
<PAGE> 3
INCOME OPPORTUNITY REALTY TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the Three Months For the Nine Months
Ended September 30, Ended September 30,
--------------------------------- -------------------------------
1995 1994 1995 1994
-------------- ------------ ------------- -------------
(dollars in thousands, except per share)
<S> <C> <C> <C> <C>
INCOME
Rents........................ $ 1,992 $ 1,677 $ 5,692 $ 4,929
Interest..................... 57 71 170 212
Equity in income (loss) of
partnerships............... (54) 25 (698) 54
----------- ----------- ----------- -----------
1,995 1,773 5,164 5,195
EXPENSES
Property operations.......... 1,152 887 3,155 2,410
Interest..................... 463 476 1,399 1,438
Depreciation................. 263 242 784 720
Advisory fee to affiliate.... 88 75 271 257
General and administrative... 168 163 566 442
----------- ----------- ----------- -----------
2,134 1,843 6,175 5,267
----------- ----------- ----------- -----------
Net (loss).................... $ (139) $ (70) $ (1,011) $ (72)
============ ============ ============ ===========
Earnings Per Share
Net (loss)................... $ (.18) $ (.09) $ (1.28) $ ( .09)
============= ============= ============= ============
Shares of beneficial
interest used in computing
earnings per share........... 791,444 791,444 791,444 791,444
============== ============== ============= ============
</TABLE>
The accompanying notes are an integral part of these Consolidated Financial
Statements.
3
<PAGE> 4
INCOME OPPORTUNITY REALTY TRUST
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
For the Nine Months Ended September 30, 1995
<TABLE>
<CAPTION>
Accumulated
Shares of Beneficial Distributions
Interest in Excess of
--------------------------- Paid-In Accumulated Shareholders'
Shares Amount Capital Earnings Equity
---------- ---------- ---------- ---------- ------------
(dollars in thousands)
<S> <C> <C> <C> <C> <C>
Balance, January 1,
1995................... 791,444 $ 3,347 $ 62,093 $ (39,868) $ 25,572
Distributions ($.45 per
share)................. - - - (356) (356)
Net loss...................... - - - (1,011) (1,011)
----------- --------- ---------- ---------- ----------
Balance, September 30,
1995................... 791,444 $ 3,347 $ 62,093 $ (41,235) $ (24,205)
=========== ========= =========== ========== ===========
</TABLE>
The accompanying notes are an integral part of these Consolidated Financial
Statements.
4
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INCOME OPPORTUNITY REALTY TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Nine Months
Ended September 30,
-----------------------------------
1995 1994
-------------- --------------
(dollars in thousands)
<S> <C> <C>
Cash Flows from Operating Activities
Rents collected................................... $ 5,667 $ 5,046
Interest collected................................ 162 203
Interest paid..................................... (1,337) (1,375)
Payments for property operations.................. (2,737) (2,279)
Advisory fee paid to affiliate.................... (272) (215)
General and administrative expenses paid.......... (665) (502)
Distributions from equity partnerships' operating
cash flow...................................... 184 117
Other............................................. (463) (413)
-------------- --------------
Net cash provided by operating activities...... 539 582
Cash Flows from Investing Activities
Funding of equity partnerships.................... (21) (127)
Real estate improvements.......................... (152) (89)
-------------- --------------
Net cash (used in) investing activities........ (173) (216)
Cash Flows from Financing Activities
Distributions from equity partnerships' financing
cash flow...................................... 486 -
Payments on notes payable......................... (431) (486)
Distributions to shareholders..................... (356) (345)
-------------- --------------
Net cash (used in) financing activities........ (301) (831)
Net increase (decrease) in cash and cash
equivalents....................................... 65 (465)
Cash and cash equivalents, beginning of period..... 232 582
-------------- --------------
Cash and cash equivalents, end of period........... $ 297 $ 117
============== ==============
Reconciliation of net (loss) to net cash provided
by operating activities
Net (loss)......................................... $ (1,011) $ (72)
Adjustments to reconcile net (loss) to net cash
provided by operating activities
Depreciation and amortization..................... 840 776
Equity in loss (income) of partnerships........... 698 (54)
Distributions from operating cash flow of equity
partnerships................................... 184 117
(Increase) in other assets........................ (548) (295)
(Decrease) in interest payable.................... (3) (2)
Increase in other liabilities..................... 379 112
-------------- --------------
Net cash provided by operating activities...... $ 539 $ 582
============== ==============
</TABLE>
The accompanying notes are an integral part of these Consolidated Financial
Statements.
5
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INCOME OPPORTUNITY REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. BASIS OF PRESENTATION
The accompanying Consolidated Financial Statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and notes
required by generally accepted accounting principles for complete financial
statements. Operating results for the nine month period ended September 30,
1995 are not necessarily indicative of the results that may be expected for the
year ending December 31, 1995. For further information, refer to the
Consolidated Financial Statements and notes thereto included in the Trust's
Annual Report on Form 10-K for the year ended December 31, 1994 (the "1994 Form
10-K").
NOTE 2. NOTES AND INTEREST RECEIVABLE
In November 1993, the Trust placed the $1.1 million wraparound mortgage note,
secured by the Cedars Apartments in Irving, Texas on nonperforming, nonaccrual
status. The Trust had sold the property securing the mortgage in 1992
providing purchase money financing in conjunction with the sale. In December
1993, the borrower filed for bankruptcy protection. The Trust recorded the
property as an insubstance foreclosure as of December 31, 1994 and accepted a
deed in lieu of foreclosure on March 2, 1995. The Trust did not incur a loss
on foreclosure as the fair value of the property, less estimated costs of sale,
exceeded the principal balance of the note receivable.
NOTE 3. REAL ESTATE HELD FOR SALE AND DEPRECIATION
As discussed in NOTE 2. "NOTES AND INTEREST RECEIVABLE," as of December 31,
1994, the Trust recorded the insubstance foreclosure of the Cedars Apartments.
The property has been renamed the Spanish Trace Apartments.
NOTE 4. INVESTMENT IN EQUITY METHOD PARTNERSHIPS
In September 1989, the Trust purchased a 40% general partner interest in Nakash
Income Associates ("NIA") for a total of $2.6 million in cash, assets and
shares of beneficial interest. NIA owns two wraparound mortgage notes
receivable, one of which is secured by the Green Hills Shopping Center ("Green
Hills") in Onandaga, New York . The shopping center in turn is owned by Green
Hills Associates ("GHA") . In July 1995, GHA determined that further
investment in Green Hills was not justified and further that it intends to deed
the property back to the first lien holder in lieu of foreclosure. As GHA has
no other assets, the wraparound note receivable held by NIA will become
uncollectible, and therefore, at June 30, 1995, NIA recorded a provision for
loss of $1.5 million to write its wraparound note receivable down to the
balance of the first lien mortgage. The Trust's equity portion of the loss is
$601,000.
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INCOME OPPORTUNITY REALTY TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
NOTE 4. INVESTMENT IN EQUITY METHOD PARTNERSHIPS (Continued)
In September 1995, the Trust received notice from NIA that one of its
wraparound notes receivable had been modified in conjunction with the
modification of the underlying note payable. NIA recorded a provision for loss
of $212,000 on such modification of which the Trust's equity share is $85,000.
The Trust is a 36.3% general partner in Tri-City Limited Partnership
("Tri-City"). In July 1995, Tri-City obtained first mortgage financing of $1.4
million, secured by the previously unencumbered MacArthur Mills Office Park
located in Dallas, Texas. The mortgage bears interest at 9.32% per annum,
requires monthly payments of principal and interest of $12,186 and matures
August 1, 2005. The Trust received $486,000 of the net financing proceeds. In
conjunction with the financing, Tri-City paid a mortgage brokerage and equity
refinancing fee of $14,000 to Basic Capital Management, Inc., the Trust's
advisor, based on the $1.4 million financing.
NOTE 5. COMMITMENTS AND CONTINGENCIES
The Trust is involved in various lawsuits arising in the ordinary course of
business. In the opinion of the Trust's management the outcome of these
lawsuits will have no material impact on the Trust's financial condition or
results of operations.
____________________________
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Introduction
Income Opportunity Realty Trust (the "Trust") was formed to invest in mortgage
loans on real estate, including first, wraparound, and junior mortgage loans,
and in equity interests in real estate through acquisitions, leases and
partnerships. The Trust was organized on December 14, 1984 and commenced
operations on April 10, 1985.
The Trust is a self-liquidating trust and is scheduled, unless and until the
Trust's shareholders decide on a contrary course of action, to begin
liquidation of its assets prior to October 24, 1996. The Trust's declaration
of Trust also requires the distribution to the Trust's shareholders of (i) the
net cash proceeds from sale or refinancing of equity investments received by
the Trust, and (ii) the net cash proceeds from the satisfaction of mortgage
notes receivable received after October 24, 1996. However, the Trust's Board
of Trustees has discretionary authority to hold any investment past October 24,
1996, should circumstances so dictate.
The Trust's management periodically reviews the self-liquidation and
finite-life provisions of the Trust's Declaration of Trust. The Trust's
management has determined that it would be in the best interest of the
7
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Introduction (Continued)
Trust's shareholders to eliminate the self-liquidation and finite-life
provisions of the Declaration of Trust and, in that regard, recommended that
the Trust's Board of Trustees approve a proposal to convert the Trust to a
Nevada corporation. On August 1, 1995, the Trust's Board of Trustees approved
such recommendation and the Trust has filed a Proxy Statement/Prospectus with
the Securities and Exchange Commission providing for a special meeting of the
Trust's shareholders. At such meeting shareholders will be presented with a
proposal to approve the conversion of the Trust to a corporation by way of the
merger of the Trust into a wholly-owned subsidiary of the Trust. This
proposal will require the approval of shareholders holding a majority of the
Trust's outstanding shares of beneficial interest.
Liquidity and Capital Resources
Cash and cash equivalents at September 30, 1995 aggregated $297,000, compared
with $232,000 at December 31, 1994. The Trust's principal sources of cash have
been and will continue to be property operations and collection of interest on
its mortgage note receivable and distributions from partnerships. The Trust
anticipates that it will have sufficient cash to meet its various cash
requirements during the remainder of 1995, including the payment of
distributions, debt service obligations and property maintenance and
improvements.
In the first nine months of 1995, the Trust paid quarterly distributions
aggregating $.45 per share or a total of $356,000.
As of November 3, 1995, the Trust had repurchased 67,952 of its shares of
beneficial interest at a cost of $1.2 million pursuant to a repurchase program
commenced in December 1989. None of such shares were repurchased in 1995. The
Trust's Board of Trustees has authorized the Trust's repurchase of a total of
100,000 shares under such repurchase program, of which 32,048 shares remain to
be repurchased. The level of any future share repurchases will depend on the
market price of the Trust's shares and the continued availability to the Trust
of excess funds.
The Trust owns a 36.3% general partner interest in Tri-City Limited Partnership
which in turn owns five properties in Texas. The Trust received distributions
of $613,000 from the partnership in July 1995. See NOTE 4. "INVESTMENT IN
EQUITY METHOD PARTNERSHIPS."
On a quarterly basis, the Trust's management reviews the carrying values of the
Trust's mortgage note receivable and properties. Generally accepted accounting
principles require that the carrying amount of an investment cannot exceed the
lower of its cost or its estimated net realizable value. In an instance where
the estimate of net realizable value of a Trust property or note is less than
the carrying value thereof at the time of evaluation, a provision for loss is
recorded by a charge against earnings. The estimate of net realizable value of
the Trust's mortgage note receivable is based on management's review and
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Liquidity and Capital Resources (Continued)
evaluation of the collateral property securing the mortgage note. The property
review generally includes selective property inspections, a review of the
property's current rents compared to market rents, a review of the property's
expenses, a review of the maintenance requirements, discussions with the
manager of the property and a review of the surrounding area. See "Recent
Accounting Pronouncement," below.
Results of Operations
For the nine months ended September 30, 1995, the Trust incurred a net loss of
$1.0 million, as compared with a net loss of $72,000 in the corresponding
period in 1994. For the three months ended September 30, 1995, the Trust had
net loss of $139,000 as compared with a net loss of $70,000 in the
corresponding period in 1994. The primary factor contributing to the Trust's
net loss in the three and nine months ended September 30, 1995 was an increase
in equity in losses of partnerships of $79,000 and $752,000, respectively, as
discussed in detail below.
Net rental income (rental income less expenses applicable to rental income) for
the first nine months of 1995 of $2.5 million approximated the $2.5 million in
the corresponding period in 1994. Net rental income for the three months ended
September 30, 1995 was $840,000, as compared to $790,000 in the corresponding
period in 1994. The increase in third quarter net rental income is primarily
due to an increase in occupancy and rental rates at one of the Trust's
residential and one of the Trust's commercial properties.
Equity in income (loss) of partnerships was a loss of $54,000 and $698,000 for
the three and nine months ended September 30, 1995 compared to income of
$25,000 and $54,000 in the corresponding periods in 1994. The increased equity
loss for the three months is primarily due to a modification of a wraparound
mortgage note receivable and underlying note payable by Nakash Income
Associates ("NIA"), a partnership in which the Trust has a 40% general partner
interest. The increased equity loss for the nine months is primarily due to
the modification discussed above, and the writedown of a wraparound mortgage
note receivable to the balance of the underlying mortgage payable also by NIA.
The Trust's equity share of the loss on the note modification was $85,000 and
its equity share of the note writedown was $601,000. See NOTE 4. "INVESTMENT
IN EQUITY METHOD PARTNERSHIPS."
Interest income, interest expense, depreciation and advisory fee expense for
the three and nine months ended September 30, 1995 all approximated that of the
corresponding periods in 1994.
General and administrative expenses for the three months ended September 30,
1995 and 1994 were comparable at $168,000 and $163,000, but for the nine months
ended September 30, 1995 increased to $566,000 from $442,000 in the
corresponding period in 1994. The increase in the nine months is primarily due
to higher communications and legal fees
9
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Results of Operations (Continued)
relating to the Trust's 1994 annual meeting of shareholders which meeting was
held in March 1995. There was no annual meeting of shareholders held in 1994.
Tax Matters
As more fully discussed in the Trust's 1994 Form 10-K, the Trust has elected
and, in management's opinion, qualified, to be taxed as a real estate
investment trust ("REIT"), as defined under Sections 856 through 860 of the
Internal Revenue Code of 1986, as amended, (the "Code"). To continue to
qualify for federal taxation as a REIT under the Code, the Trust is required to
hold at least 75% of the value of its total assets in real estate assets,
government securities, cash and cash equivalents at the close of each quarter
of each taxable year. The Code also requires a REIT to distribute at least 95%
of its REIT taxable income plus 95% of its net income from foreclosure
property, all as defined in Section 857 of the Code, on an annual basis to
shareholders.
Inflation
The effects of inflation on the Trust's operations are not quantifiable.
Revenues from property operations generally fluctuate proportionately with
inflationary increases and decreases in housing costs. Fluctuations in the rate
of inflation also affect the sales value of properties and, correspondingly,
the ultimate realizable value of the Trust's real estate and notes receivable
portfolios.
Environmental Matters
Under various federal, state and local environmental laws, ordinances and
regulations, the Trust may be potentially liable for removal or remediation
costs, as well as certain other potential costs, relating to hazardous or toxic
substances (including governmental fines and injuries to persons and property)
where property-level managers have arranged for the removal, disposal or
treatment of hazardous or toxic substances. In addition, certain environmental
laws impose liability for release of asbestos-containing materials into the
air, and third parties may seek recovery from the Trust for personal injury
associated with such materials.
The Trust's management is not aware of any environmental liability relating to
the above matters that would have a material adverse effect on the Trust's
business, assets or results of operations.
Recent Accounting Pronouncement
In March 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") No. 121 - "Accounting for the
Impairment of Long-lived Assets and for Long-lived Assets to Be Disposed Of."
10
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Recent Accounting Pronouncement (Continued)
As discussed under "Introduction" above, the Trust is a self liquidating trust.
Accordingly, all of the Trust's properties are classified as held for sale.
SFAS No. 121 requires long-lived assets held for sale "...be reported at the
lower of carrying amount or fair value less cost to sell." If a reduction in a
held for sale asset's carrying amount to fair value less cost to sell is
required, a provision for loss shall be recognized by a charge against
earnings. Subsequent revisions, either upward or downward, to a held for sale
asset's estimated fair value less cost to sell shall be recorded as an
adjustment to the asset's carrying amount, but not in excess of the asset's
carrying amount when originally classified as held for sale. A corresponding
charge against or credit to earnings is to be recognized. Long-lived assets
held for sale are not to be depreciated. SFAS No. 121 is effective for fiscal
years beginning after December 15, 1995.
The Trust's management has not fully evaluated the effects of adopting SFAS No.
121, but it estimates that if the Trust had adopted SFAS No. 121 effective
January 1, 1995, the Trust would have recorded no depreciation in the three and
nine months ended September 30, 1995, the Trust's reported net loss for the
three and nine months ended September 30, 1995 would have been decreased by
$263,000 and $784,000 respectively, and that a provision for loss to reduce any
property's carrying amount to its fair value less cost to sell would not have
been required in either period.
_____________________________
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
The Trust's management has periodically reviewed the self-liquidation and
finite-life provisions of the Trust's Declaration of Trust. After its most
recent review, the Trust's management determined that it would be in the best
interest of the Trust's shareholders to eliminate the self-liquidation and
finite-life provisions of the Declaration of Trust and, in that regard,
recommended that the Trust's Board of Trustees approve a proposal to convert
the Trust to a Nevada corporation. On August 1, 1995, the Trust's Board of
Trustees approved such recommendation. The Board of Trustees believes the
change from a finite-life business trust to an infinite life corporation will
afford the opportunity for enhanced long-range planning, flexibility and
long-term growth. The Trust has filed a Proxy Statement/Prospectus with the
Securities and Exchange Commission providing for a special meeting of the
Trust's shareholders. At such meeting shareholders will be presented with a
proposal to approve the conversion of the Trust to a corporation by way of
merger of the Trust into a wholly-owned subsidiary of the Trust. This
proposal will require the approval of shareholders holding a majority of the
Trust's outstanding shares of beneficial interest.
11
<PAGE> 12
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit
Number Description
- ------- ------------------------------------------------------
27.0 Financial Data Schedule, filed herewith.
(b) Reports on Form 8-K as follows:
None.
12
<PAGE> 13
SIGNATURE PAGE
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.
INCOME OPPORTUNITY REALTY TRUST
Date: November 13, 1995 By: /s/ Randall M. Paulson
--------------------- ------------------------
Randall M. Paulson
President
Date: November 13, 1995 By: /s/ Thomas A. Holland
--------------------- ------------------------
Thomas A. Holland
Executive Vice President
and Chief Financial
Officer (Principal
Financial and Accounting
Officer)
13
<PAGE> 14
INCOME OPPORTUNITY REALTY TRUST
EXHIBITS TO
QUARTERLY REPORT ON FORM 10-Q
For the Three Months Ended September 30, 1995
Exhibit Page
Number Description Number
- ------- -----------------------------------------------
27.0 Financial Data Schedule. 15
14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 297
<SECURITIES> 0
<RECEIVABLES> 1,983
<ALLOWANCES> 121
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 46,364
<DEPRECIATION> 5,839
<TOTAL-ASSETS> 46,938
<CURRENT-LIABILITIES> 0
<BONDS> 20,284
<COMMON> 0
0
0
<OTHER-SE> 24,205
<TOTAL-LIABILITY-AND-EQUITY> 46,938
<SALES> 0
<TOTAL-REVENUES> 5,692
<CGS> 0
<TOTAL-COSTS> 3,155
<OTHER-EXPENSES> 784
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,399
<INCOME-PRETAX> (1,011)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,011)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,011)
<EPS-PRIMARY> (1.28)
<EPS-DILUTED> (1.28)
</TABLE>
