<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1995
COMMISSION FILE NUMBER 0-14458
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
(Exact name of registrant as specified in its charter)
MARYLAND 52-1365317
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1225 EYE STREET, N.W.
WASHINGTON, D.C. 20005
(Address of principal executive offices)
(Zip Code)
(202) 347-6247
(Registrant's telephone number, including area code)
NOT APPLICABLE
(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
----- -----
<PAGE> 2
PART 1 - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
STATEMENTS OF FINANCIAL POSITION
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------------ ------------------
<S> <C> <C>
ASSETS
------
Cash and cash equivalents $ 10,909 $ 44,627
Deposits held by escrow agents 28 28
Investments in and advances to
Local Limited Partnerships (Note 2) 4,182,322 3,985,024
---------- ----------
$ 4,193,259 $ 4,029,679
========== ==========
LIABILITIES AND PARTNERS' DEFICIT
---------------------------------
Liabilities:
Due to General Partner (Note 3) $ 197,811 $ 197,811
Deferred acquisition notes
payable to General Partner 2,414,468 2,414,468
Accrued interest on deferred
acquisition notes payable to
General Partner 2,516,179 2,335,094
Accrued interest on Due to General Partner
(Note 3) 27,965 10,188
Administrative and reporting fees
payable to General Partner (Note 3) 926,422 823,486
Other accrued expenses 30,750 37,350
---------- ----------
6,113,595 5,818,397
---------- ----------
Partners' deficit:
General Partner -- The National
Housing Partnership (NHP) (174,292) (172,976)
Original Limited Partner --
1133 Fifteenth Street Two Associates (179,192) (177,876)
Other Limited Partners -- 18,300
investment units (1,566,852) (1,437,866)
---------- ----------
(1,920,336) (1,788,718)
---------- ----------
$ 4,193,259 $ 4,029,679
========== ==========
</TABLE>
See notes to financial statements.
-1-
<PAGE> 3
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
----------------------- ------------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES:
Share of income from
Local Limited Partnerships $ 48,194 $ 30,570 $197,298 $ 60,323
Distributions and repayments
received in excess of
investment in and advances
to Local Limited Partnerships - 7,348 7,449 103,347
Interest income 403 266 1,160 1,423
-------- -------- -------- --------
48,597 38,184 205,907 165,093
-------- -------- -------- --------
COSTS AND EXPENSES:
Loss on investment in Local
Limited Partnerships - - - 6,673
Administrative and reporting
fees to General Partner (Note 3) 34,312 34,312 102,936 102,936
Interest on deferred acquisition
notes to General Partner 60,361 60,361 181,085 181,085
Interest on due to General Partner 6,100 4,843 17,777 16,064
Other operating expenses 10,877 10,739 35,727 34,963
-------- -------- -------- --------
111,650 110,255 337,525 341,721
-------- -------- -------- --------
NET LOSS $(63,053) $(72,071) $(131,618) $(176,628)
======== ======== ======== --------
NET LOSS ASSIGNABLE TO
LIMITED PARTNERS $(61,793) $(70,631) $(128,986) $(173,096)
======== ======== ======== ========
NET LOSS PER LIMITED
PARTNERSHIP INTEREST $ (3) $ (4) $ (7) $ (9)
======== ======== ======== ========
</TABLE>
See notes to financial statements.
-2-
<PAGE> 4
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
STATEMENT OF PARTNERS' DEFICIT
<TABLE>
<CAPTION>
The National 1133
Housing Fifteenth Other
Partnership Street Two Limited
(NHP) Associates Partners Total
------------ ---------- -------- -----
<S> <C> <C> <C> <C>
Deficit at January 1, 1995 $(172,976) $(177,876) $(1,437,866) $(1,788,718)
Net loss -- nine months
ended September 30, 1995 (1,316) (1,316) (128,986) (131,618)
-------- -------- ---------- ----------
Deficit at September 30, 1995 $(174,292) $(179,192) $(1,566,852) $(1,920,336)
======== ======== ========== ==========
Percentage interest at
September 30, 1995 1% 1% 98% 100%
========== ======== ========== =========
(A) (B) (C)
</TABLE>
(A) General Partner
(B) Original Limited Partner
(C) Consists of 18,300 investments units of 0.00536% held by 1,298 investors
See notes to financial statements.
-3-
<PAGE> 5
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Nine Months Ended
September 30
-----------------------------------
1995 1994
------ ------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Distributions received from Local Limited Partnerships $ - $ 21,850
Distributions received in excess of investment in and
advances to Local Limited Partnerships - 72,186
Interest paid to General Partner - (66,997)
Interest received 1,160 1,423
Operating expenses paid (42,327) (38,792)
------- -------
Net cash used in operating activities
(41,167) (10,330)
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Advances to Local Limited Partnerships - (6,673)
Repayment of advances to Local Limited Partnerships 7,449 31,161
------- -------
Net cash provided by investing activities 7,449 24,488
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of advances from General Partner - (6,001)
------- -------
NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS (33,718) 8,157
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD 44,627 35,583
------- -------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 10,909 $ 43,740
======= =======
</TABLE>
See notes to financial statements.
-4-
<PAGE> 6
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
(CONTINUED)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------------------------------
1995 1994
---- ----
<S> <C> <C>
RECONCILIATION OF NET LOSS TO NET CASH
USED IN OPERATING ACTIVITIES:
Net loss $(131,618) $(176,628)
--------- --------
Adjustments to reconcile net loss to net cash used in
operating activities:
Distributions received from Local Limited Partnerships - 21,850
Repayment of advances to Local Limited Partnerships (7,449) (31,161)
Loss on investment in Local Limited Partnerships - 6,673
Share of income from Local Limited Partnerships (197,298) (60,323)
Increase in accrued interest on deferred acquisition
notes 181,085 181,085
Increase (decrease) in accrued interest on due to
General Partner 17,777 (50,933)
Increase in administrative and reporting fees payable 102,936 102,936
Decrease in accrued expenses (6,600) (3,829)
--------- ---------
Total adjustments 90,451 166,298
--------- --------
Net cash used in operating activities $ (41,167) $ (10,330)
========= =========
</TABLE>
See notes to financial statements.
-5-
<PAGE> 7
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
(1) ACCOUNTING POLICIES
ORGANIZATION
National Housing Partnership Realty Fund Two (the "Partnership") is a
limited partnership organized under the laws of the State of Maryland
under the Maryland Revised Uniform Limited Partnership Act on January
22, 1985. The Partnership was formed for the purpose of raising
capital by offering and selling limited partnership interests and then
investing in limited partnerships ("Local Limited Partnerships"), each
of which owns and operates an existing rental housing project which is
financed and/or operated with one or more forms of rental assistance
or financial assistance from the U.S. Department of Housing and Urban
Development ("HUD").
The General Partner raised capital for the Partnership by offering and
selling to additional limited partners 18,300 investment units at a
price of $1,000 per unit. The Partnership acquired limited
partnership interests of 94.5% (98% with respect to allocation of
losses) in twenty-one Local Limited Partnerships, nineteen of which
were organized to acquire and operate an existing rental housing
project. The remaining two Local Limited Partnerships were formed to
construct and operate rental housing projects.
BASIS OF PRESENTATION
The accompanying unaudited interim financial statements reflect all
adjustments which are, in the opinion of management, necessary to a
fair statement of the financial condition and results of operations
for the interim periods presented. All such adjustments are of a
normal and recurring nature.
While the General Partner believes that the disclosures presented are
adequate to make the information not misleading, it is suggested that
these financial statements be read in conjunction with the financial
statements and notes included in NHP Realty Fund Two's Annual Report
filed in Form 10-K, as amended, for the year ended December 31, 1994.
(2) INVESTMENTS IN AND ADVANCES TO LOCAL LIMITED PARTNERSHIPS
The Partnership owns a 94.5% limited partnership interest (98% with
respect to allocation of losses) in twenty-one Local Limited
Partnerships. Because the Partnership, as a limited partner, does not
exercise control over the activities of the Local Limited Partnerships
in accordance with the partnership agreements, the investments in
Local Limited Partnerships are accounted for using the equity method.
Thus, the investments (and the advances made
-6-
<PAGE> 8
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
to the Local Limited Partnerships as discussed below) are carried at
cost less the Partnership's share of the Local Limited Partnerships'
losses and distributions. However, because the Partnership is not
legally liable for the obligations of the Local Limited Partnerships,
and is not otherwise committed to provide additional support to them,
it does not recognize losses once its investments, reduced for its
share of losses and cash distributions, reaches zero in each of the
individual Local Limited Partnerships. As of September 30, 1995 and
December 31, 1994, investments in nineteen of the twenty-one Local
Limited Partnerships had been reduced to zero. As a result, the
Partnership did not recognize $1,422,389 and $1,544,549 of losses from
these nineteen Local Limited Partnerships during the nine months ended
September 30, 1995 and 1994, respectively. As of September 30, 1995
and December 31, 1994, the Partnership has not recognized a total of
$18,421,536 and $16,999,147, respectively, of its allocated share of
cumulative losses from the Local Limited Partnerships in which its
investment is zero.
Advances made by the Partnership to the individual Local Limited
Partnerships are considered part of the Partnership's investment in
Local Limited Partnerships. When advances are made, they are charged
to operations as a loss on investment in the Local Limited Partnership
using previously unrecognized cumulative losses. As discussed above,
due to the cumulative losses incurred by nineteen of the Local Limited
Partnerships, the aggregate balance of investments in and advances to
Local Limited Partnerships, for these nineteen Local Limited
Partnerships, has been reduced to zero at September 30, 1995 and
December 31, 1994. To the extent these advances are repaid by the
Local Limited Partnerships in the future, the repayments will be
credited as distributions and repayments received in excess of
investment in Local Limited Partnerships. These advances are carried
as a payable to the Partnership by the Local Limited Partnerships.
During the nine months ended September 30, 1994, the Partnership
advanced $6,673 in working capital to three Local Limited
Partnerships. No advances were made during the nine months ended
September 30, 1995. These advances were charged to operations as loss
on investment in Local Limited Partnerships. Repayments of advances
of $7,449 and $31,161 were made to the Partnership during the nine
months ended September 30, 1995 and 1994, respectively, and were
credited as income from operations. The combined amount carried as
due to the Partnership by the Local Limited Partnerships was $597,555
at September 30, 1995.
The following are combined statements of operations for the three
months and nine months ended September 30, 1995 and 1994,
respectively, of the Local Limited Partnerships in which the
Partnership has invested. The statements are compiled from financial
statements
-7-
<PAGE> 9
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
of the Local Limited Partnerships, prepared on the accrual basis of
accounting, as supplied by the management agents of the projects, and
are unaudited.
COMBINED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended September 30, Nine Months Ended September 30,
-------------------------------- -------------------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Rental income $3,615,199 $3,436,833 $10,781,444 $10,227,107
Other income 79,360 69,385 265,830 221,127
----------- ----------- ----------- ------------
Total income 3,694,559 3,506,218 11,047,274 10,448,234
--------- --------- ---------- ----------
Operating expenses 2,551,207 2,140,435 7,189,860 7,008,678
Interest, taxes and
insurance 1,160,318 1,167,891 3,361,329 3,324,427
Depreciation 597,811 553,275 1,738,721 1,629,645
--------- --------- ---------- ----------
Total expenses 4,309,336 3,861,601 12,289,910 11,962,750
--------- --------- ---------- ----------
Net loss $ (614,777) $ (355,383) $(1,242,636) $(1,514,516)
========= ========= ========== ==========
National Housing
Partnership Realty
Fund Two share of
losses $ (604,267) $ (348,276) $(1,225,091) $(1,484,226)
========= ========= ========== ==========
</TABLE>
(3) TRANSACTIONS WITH THE GENERAL PARTNER
During the nine month periods ended September 30, 1995 and 1994, the
Partnership accrued administrative and reporting fees payable to the
General Partner in the amount of $102,936 for services provided to the
Partnership. The Partnership did not make any payments to the General
Partner for these fees during each of the respective periods. The
amount due the General Partner by the Partnership was $926,422 and
$823,486 at September 30, 1995 and December 31, 1994, respectively.
During the nine months ending September 30, 1995, no operating deficit
funding or repayment activity occurred between the General Partner and
the Partnership. During the
-8-
<PAGE> 10
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
nine months ended September 30, 1994, the Partnership repaid $6,001 of
principal and $66,997 of interest to the General Partner. The amount
owed to the General Partner by the Partnership was $197,811 as of
September 30, 1995 and December 31, 1994. Interest is charged on
borrowings at the Chase Manhattan Bank rate of prime plus 2%. Accrued
interest on this loan as of September 30, 1995 and December 31, 1994,
totaled $27,965 and $10,188, respectively.
The advances and accrued administrative and reporting fees payable to
the General Partner will be paid only as cash flow permits or from the
sale or refinancing of one or more of the underlying properties of the
Local Limited Partnerships.
-10-
<PAGE> 11
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
LIQUIDITY AND CAPITAL RESOURCES
The properties in which the Partnership has invested, through its investments
in the Local Limited Partnerships, receive one or more forms of assistance from
Federal, state or local governments or agencies. As a result, the Local
Limited Partnerships' ability to transfer funds either to the Partnership or
among themselves in the form of cash distributions, loans or advances is
generally restricted by these government-assistance programs. These
restrictions, however, are not expected to impact the Partnership's ability to
meet its cash obligations.
Net cash used in operations for the nine months ended September 30, 1995 was
$41,167 as compared to $10,330 for the nine months ended September 30, 1994.
The increase in cash used in operations resulted from a decrease in
distributions received from the Local Limited Partnerships and an increase in
operating expenses paid, offset by a decrease in interest paid to the General
Partner, during the nine months ended September 30, 1995 compared to the nine
months ended September 30, 1994.
During the nine months ended September 30, 1995, the Partnership made no
working capital advances compared to $6,673 advanced to three of the Local
Limited Partnerships during the nine months ended September 30, 1994. Advances
of $7,449 and $31,161 were repaid to the Partnership during the nine months
ended September 30, 1995 and 1994, respectively. As of September 30, 1995,
the combined amount carried by the Local Limited Partnerships, as due to the
Partnership, amounted to $597,555. Future advances made to the nineteen Local
Limited Partnerships' properties whose investments have been reduced to zero,
will be charged to operations; likewise, future repayments from these
properties will be credited to operations.
Distributions received from Local Limited Partnerships represent the
Partnership's proportionate share of the excess cash available for distribution
from the Local Limited Partnerships. As a result of the use of the equity
method of accounting for the Partnership's investments, as of September 30,
1995, investments in nineteen Local Limited Partnerships had been reduced to
zero. For these investments, cash distributions received are recorded in
income as distributions received in excess of investment in Local Limited
Partnerships. For those investments not reduced to zero, distributions
received are recorded as distributions from Local Limited Partnerships. There
were no cash distributions during the nine months ended September 30, 1995.
Cash distributions of $94,036 were received from four Local Limited
Partnerships during the nine months ended September 30, 1994. The receipt of
distributions in future quarters is dependent upon the operations of the
underlying properties of the Local Limited Partnerships.
-10-
<PAGE> 12
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Cash and cash equivalents amounted to $10,909 at September 30, 1995. The
ability of the Partnership to meet its on-going cash requirements, in excess of
cash on hand at September 30, 1995, is dependent upon the future receipt of
distributions from the Local Limited Partnerships or proceeds from sales or
refinancings of one or more of the underlying properties of the Local Limited
Partnerships. Cash on hand at September 30, 1995, plus any distributions from
the underlying operations of the combined Local Limited Partnerships is
expected to adequately fund the operations of the Partnership in the current
year. However, there can be no assurance that future distributions will be
adequate to fund the operations beyond the current year.
The Partnership currently owes the General Partner $926,422 for administrative
and reporting services performed in addition to $197,811 advanced from the
General Partner to fund working capital needs. The payment of these unpaid
administrative and reporting fees as well as the advances, will most likely
result from the sale or refinancing of the underlying properties of the Local
Limited Partnerships, rather than through recurring operations.
Some of the Properties in which the Partnership has invested may be eligible to
participate in the Low Income Housing Preservation and Resident Homeownership
Act of 1990 (LIHPRHA). LIHPRHA creates a procedure under which properties
assisted under the HUD Section 236 or 221(d)(3) programs may be eligible to
receive financial incentives in return for agreeing to extend their property's
use as low income housing. Nineteen of the Local Limited Partnerships in which
the Partnership has invested carry deferred acquisition notes due to the
original owners of the Properties. In the event of a default on these notes,
the noteholders would assume ownership of both the General Partner's and the
Partnership's interests in the Local Limited Partnerships. All of the notes
have final maturity dates between 1996 and 1999. Due to the weakness in the
rental markets where the Properties are located, the General Partner currently
believes the amounts due on the acquisition notes will likely exceed the value
to be obtained through the Properties' participation in LIHPRHA or other sale
or refinancing opportunities.
The General Partner intends to continue negotiations with the noteholders to
either extend the maturity dates of the notes or structure an arrangement where
both the noteholders and partners can benefit financially from participation in
LIHPRHA or other sales or refinancings. Such an arrangement was reached with
the noteholder associated with Tinker Creek. Under the terms of that agreement,
if the General Partner can process a sale of the property under LIHPRHA, the
noteholder will accept a discounted pay-off.
The General Partner is currently investigating the ability of Gulfway Manor,
Kimberton, Meadows, Meadows East and Rockwell Manor to participate in LIHPRHA.
San Juan del Centro is unable to
-11-
<PAGE> 13
NATIONAL HOUSING PARTNERSHIP REALTY FUND TWO
(A MARYLAND LIMITED PARTNERSHIP)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
participate in LIHPRHA under conditions set forth in its mortgage note.
Studies are still in process to determine if the other properties are likely
candidates to participate in LIHPRHA.
Congress and the Administration are currently considering various proposals to
significantly reduce or eliminate funding for the LIHPRHA program and to
restructure various federal housing programs under the jurisdiction of the
Department of Housing and Urban Development. NHP is actively working to affect
the policy decisions being made and to limit any detrimental effect on its
portfolio. Depending on the final outcome of this process, however, operations
at the Properties and/or the ability to sell or refinance under LIHPRHA could
be affected.
RESULTS OF OPERATIONS
The Partnership has invested as a limited partner in Local Limited Partnerships
which operate twenty-one rental housing properties. In prior years, results of
operations of NHP Realty Fund Two were significantly impacted by the
Partnership's share of the losses of the Local Limited Partnerships. These
losses included depreciation and accrued deferred acquisition note interest
expense which are noncash in nature. Nineteen of the twenty-one investments in
Local Limited Partnership's have been reduced to zero. As a result, the
Partnership's operations are no longer being materially affected by its share
of the operations from these nineteen partnerships. The Partnership has
recorded its share of income in the remaining two Local Limited Partnership's
which amounted to $197,298 and $60,323 for the nine months ended September 30,
1995 and 1994, respectively.
The Partnership's net loss decreased to $131,618 for the nine months ended
September 30, 1995 from a net loss of $176,628 for the nine months ended
September 30, 1994. Net loss per unit of limited partnership interest
decreased to $7 from $9 for the 18,300 units outstanding throughout both
periods. The decrease in net loss was primarily due to an increase in the
Partnership's share of income from the Local Limited Partnerships, partially
offset by a decrease in distributions and repayments received in excess of
investment in and advances to Local Limited Partnerships. The Partnership did
not recognize $1,422,389 of its allocated share of losses from nineteen Local
Limited Partnerships for the nine months ended September 30, 1995, as the
Partnership's net carrying basis in these Partnerships had been reduced to
zero. The Partnership's share of losses from the Local Limited Partnerships,
if not limited to its investment account balance, would have decreased $259,135
between periods, primarily due to an increase in rental income, partially
offset by an increase in operating expenses.
-12-
<PAGE> 14
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 HOUSING PARTNERSHIP REALTY FUND TWO
(Registrant)
By: The National Housing Partnership,
its sole General Partner
By: National Corporation for Housing
Partnerships, its sole General Partner
November 10, 1995 By: /s/ Jeffrey J. Ochs
--------------------------------------
Jeffrey J. Ochs
As Vice President, Finance and Accounting,
and Chief Accounting Officer
-13-
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 10,937
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 10,937
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 4,193,259
<CURRENT-LIABILITIES> 1,182,948
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> (1,920,336)
<TOTAL-LIABILITY-AND-EQUITY> 4,193,259
<SALES> 0
<TOTAL-REVENUES> 205,907
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 138,663
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 198,862
<INCOME-PRETAX> (131,618)
<INCOME-TAX> 0
<INCOME-CONTINUING> (131,618)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (131,618)
<EPS-PRIMARY> (7)
<EPS-DILUTED> (7)
</TABLE>
