SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter ended September 30, 1996Commission file #0-16108
JMB INCOME PROPERTIES, LTD. - XII
(Exact name of registrant as specified in its charter)
Illinois 36-3337796
(State of organization) (IRS Employer Identification No.)
900 N. Michigan Ave., Chicago, IL 60611
(Address of principal executive office)(Zip Code)
Registrant's telephone number, including area code 312/915-1987
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
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Financial Statements. . . . . . . . . . . . 3
Item 2. Management's Discussion and
Analysis of Financial Condition
and Results of Operations . . . . . . . . . 12
PART II OTHER INFORMATION
Item 5. Other Information . . . . . . . . . . . . . 15
Item 6. Exhibits and Reports on Form 8-K. . . . . . 16
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JMB INCOME PROPERTIES, LTD. - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1996 AND DECEMBER 31, 1995
(UNAUDITED)
ASSETS
------
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1996 1995
------------- -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents. . . . . . . . . . . . . . . . . . $ 31,202,848 21,456,552
Rents and other receivables, net of allowance for
doubtful accounts of $260,217 at September 30,
1996 and $784,652 at December 31, 1995 . . . . . . . . . . 1,814,873 2,542,548
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . 579,361 260,164
Escrow deposits. . . . . . . . . . . . . . . . . . . . . . . 1,015,656 900,561
------------ -----------
Total current assets . . . . . . . . . . . . . . . . . 34,612,738 25,159,825
------------ -----------
Investment properties, at cost:
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,447,734 20,494,992
Buildings and improvements . . . . . . . . . . . . . . . . . 132,460,593 168,635,413
------------ -----------
145,908,327 189,130,405
Less accumulated depreciation. . . . . . . . . . . . . . . . 44,702,207 52,390,756
------------ -----------
Total investment properties, net of
accumulated depreciation . . . . . . . . . . . . . . 101,206,120 136,739,649
Investment in unconsolidated ventures, at equity . . . . . . . 4,559,675 6,412,066
Deferred expenses. . . . . . . . . . . . . . . . . . . . . . . 6,630,560 7,639,146
Accrued rents receivable . . . . . . . . . . . . . . . . . . . 1,450,614 2,558,056
------------ -----------
$148,459,707 178,508,742
============ ===========
LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS
------------------------------------------
Current liabilities:
Current portion of long-term debt. . . . . . . . . . . . . . $ 447,143 746,306
Accounts payable . . . . . . . . . . . . . . . . . . . . . . 2,021,044 2,038,017
Accrued interest . . . . . . . . . . . . . . . . . . . . . . 504,191 510,622
Unearned rents . . . . . . . . . . . . . . . . . . . . . . . 30,434 23,320
------------ -----------
Total current liabilities. . . . . . . . . . . . . . . 3,002,812 3,318,265
Tenant security deposits . . . . . . . . . . . . . . . . . . . 195,990 492,214
Long-term debt, less current portion . . . . . . . . . . . . . 63,749,736 88,670,160
------------ -----------
Commitments and contingencies
Total liabilities. . . . . . . . . . . . . . . . . . . 66,948,538 92,480,639
Venture partners' subordinated equity in ventures. . . . . . . 17,050,633 22,041,429
Partners' capital accounts:
General partners:
Capital contributions. . . . . . . . . . . . . . . . . . . 11,123 11,123
Cumulative net earnings (losses) . . . . . . . . . . . . . 869,677 769,195
------------ -----------
880,800 780,318
------------ -----------
Limited partners (189,684 interests):
Capital contributions, net of offering costs . . . . . . . 171,306,452 171,306,452
Cumulative net earnings (losses) . . . . . . . . . . . . . (25,420,140) (30,082,749)
Cumulative cash distributions. . . . . . . . . . . . . . . (82,306,576) (78,017,347)
------------ -----------
63,579,736 63,206,356
------------ -----------
Total partners' capital accounts . . . . . . . . . . . 64,460,536 63,986,674
------------ -----------
$148,459,707 178,508,742
============ ===========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
----------------------------------------------------
1996 1995 1996 1995
----------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
Income:
Rental income. . . . . . . . . . . . . . $ 7,379,950 10,303,525 21,949,421 24,668,441
Interest income. . . . . . . . . . . . . 297,925 363,073 867,965 1,005,930
----------- ---------- ----------- ----------
7,677,875 10,666,598 22,817,386 25,674,371
----------- ---------- ----------- ----------
Expenses:
Mortgage and other interest. . . . . . . 1,870,157 2,226,549 6,150,810 6,831,569
Depreciation . . . . . . . . . . . . . . 1,095,958 1,496,163 3,551,435 4,304,765
Property operating expenses. . . . . . . 3,082,467 3,187,195 9,516,807 9,189,851
Professional services. . . . . . . . . . 91,256 1,815 246,116 227,424
Amortization of deferred expenses. . . . 269,435 332,764 887,733 1,002,752
General and administrative . . . . . . . 102,361 151,975 358,143 323,388
Provision for value impairment . . . . . -- 5,500,000 -- 5,500,000
----------- ---------- ----------- ----------
6,511,634 12,896,461 20,711,044 27,379,749
----------- ---------- ----------- ----------
Operating earnings (loss). . . . . 1,166,241 (2,229,863) 2,106,342 (1,705,378)
Partnership's share of operations of
unconsolidated ventures. . . . . . . . . 93,771 (161,363) 323,000 356,672
Venture partners' share of ventures'
operations . . . . . . . . . . . . . . . (475,486) (1,213,874) (667,624) (1,322,305)
----------- ---------- ----------- ----------
Net operating earnings (loss). . . 784,526 (3,605,100) 1,761,718 (2,671,011)
Partnership's share of gain on sale
of investment properties of
unconsolidated venture . . . . . . . . . -- -- 1,412,610 --
Gain on sale of investment property,
net of venture partner's share of
$1,256,668 . . . . . . . . . . . . . . . 1,588,763 -- 1,588,763 --
----------- ---------- ----------- ----------
Net earnings (loss). . . . . . . . $ 2,373,289 (3,605,100) 4,763,091 (2,671,011)
=========== ========== =========== ==========
Net earnings (loss) per limited
partnership interest:
Net operating earnings (loss). . $ 3.97 (18.25) 8.92 (13.52)
Partnership's share of gain on
sale of investment properties
of unconsolidated venture. . . -- -- 7.37 --
Gain on sale of investment
property net of venture
partner's share. . . . . . . . 8.29 -- 8.29 --
----------- ---------- ----------- ----------
Net earnings (loss). . . . . $ 12.26 (18.25) 24.58 (13.52)
=========== ========== =========== ==========
Cash distributions per
limited partnership
interest . . . . . . . . . . . . $ -- 2.50 22.50 7.50
=========== ========== =========== ==========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
<CAPTION> 1996 1995
------------ -----------
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss). . . . . . . . . . . . . . . . . . . . . . .$ 4,763,091 (2,671,011)
Items not requiring (providing) cash or cash equivalents:
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . 3,551,435 4,304,765
Amortization of deferred expenses. . . . . . . . . . . . . . . 887,733 1,002,752
Partnership's share of operations of unconsolidated
ventures . . . . . . . . . . . . . . . . . . . . . . . . . . (323,000) (356,672)
Partnership's share of gain on sale of investment
properties of unconsolidated venture . . . . . . . . . . . . (1,412,610) --
Venture partners' share of ventures' operations and gain on sale 1,924,292 1,322,305
Total gain on sale of investment property. . . . . . . . . . . (2,845,431) --
Provision for value impairment . . . . . . . . . . . . . . . . -- 5,500,000
Changes in:
Rents and other receivables. . . . . . . . . . . . . . . . . . 595,451 (383,656)
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . (319,197) (434,988)
Escrow deposits. . . . . . . . . . . . . . . . . . . . . . . . (115,095) 199,967
Casualty insurance receivable. . . . . . . . . . . . . . . . . -- 853,000
Accrued rents receivable . . . . . . . . . . . . . . . . . . . 356,012 (63,325)
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . (16,973) (1,033,916)
Accrued interest . . . . . . . . . . . . . . . . . . . . . . . (6,431) 508,869
Accrued real estate taxes. . . . . . . . . . . . . . . . . . . -- 241,487
Unearned rents . . . . . . . . . . . . . . . . . . . . . . . . 41,312 (53,952)
Tenant security deposits . . . . . . . . . . . . . . . . . . . (322,499) (9,039)
------------ -----------
Net cash provided by (used in) operating activities. . . . 6,758,090 8,926,586
------------ -----------
Cash flows from investing activities:
Net sales and maturities (purchases) of short-term
investments. . . . . . . . . . . . . . . . . . . . . . . . . . -- 12,223,613
Additions to investment properties,
net of related payables in 1995. . . . . . . . . . . . . . . . (1,409,730) (1,206,974)
Cash proceeds on sale of investment property . . . . . . . . . . 13,017,039 --
Partnership's distributions from unconsolidated
ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,588,000 1,250,000
Payment of deferred expenses . . . . . . . . . . . . . . . . . . (487,754) (554,495)
------------ -----------
Net cash provided by (used in) investing activities. . . . 14,707,555 11,712,144
------------ -----------
Cash flows from financing activities:
Principal payments on long-term debt . . . . . . . . . . . . . . (515,032) (438,726)
Advances from affiliate. . . . . . . . . . . . . . . . . . . . . -- (435,000)
Venture partners' contributions to venture . . . . . . . . . . . 100,648 42,811
Distributions to venture partners. . . . . . . . . . . . . . . . (7,015,736) (1,463,400)
Distributions to limited partners. . . . . . . . . . . . . . . . (4,289,229) (1,429,743)
------------ -----------
Net cash provided by (used in) financing activities. . . . (11,719,349) (3,724,058)
------------ -----------
Net increase (decrease) in cash and cash equivalents . . . 9,746,296 16,914,672
Cash and cash equivalents, beginning of year . . . . . . . 21,456,552 8,222,359
------------ -----------
Cash and cash equivalents, end of period . . . . . . . . .$ 31,202,848 25,137,031
============ ===========
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest. . . . . . . . . . . .$ 6,157,241 6,322,700
============ ===========
Non-cash investing and financing activities:
Total sales proceeds from sale of investment property,
net of selling expenses . . . . . . . . . . . . . . . . . .$ 37,721,594 --
Principal balance due on mortgage payable. . . . . . . . . . (24,704,555) --
------------ -----------
Cash proceeds from sale of investment property,
net of selling expenses. . . . . . . . . . . . . . . . .$ 13,017,039 --
============ ===========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
JMB INCOME PROPERTIES, LTD. - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
GENERAL
Readers of this quarterly report should refer to the Partnership's
audited financial statements for the fiscal year ended December 31, 1995
which are included in the Partnership's 1995 Annual Report, as certain
footnote disclosures which would substantially duplicate those contained in
such audited financial statements have been omitted from this report.
The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Statement of Financial Accounting Standards No. 121 was adopted by the
Partnership on January 1, 1996.
TRANSACTIONS WITH AFFILIATES
The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Managing General Partner
and its affiliates, including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investments. Fees, commissions and other
expenses required to be paid by the Partnership to the General Partners and
their affiliates as of September 30, 1996 and for the nine months ended
September 30, 1996 and 1995 were as follows:
Unpaid at
September 30,
1996 1995 1996
-------- ------ -------------
Property management
and leasing fees. . . . . $ 76,190 49,150 --
Insurance commissions. . . 33,233 70,488 --
Reimbursement (at cost)
for out-of-pocket
salary and salary-
related expenses
related to the on-site
and other costs for the
Partnership and its
investment properties . . 98,667 177,690 83,623
-------- ------- ------
$208,090 297,328 83,623
======== ======= ======
In accordance with the subordination requirements of the Partnership
Agreement, the General Partners have deferred payment of their
distributions of net cash flow and sales proceeds from the Partnership.
The amount of such deferred distributions was approximately $7,942,000 as
of September 30, 1996. All amounts deferred or currently payable do not
bear interest.
40 BROAD STREET
Occupancy of this property increased to 81%, up from 78% at the end of
the previous quarter due to the move-in of two new tenants. For the
remainder of the year, leases covering approximately 25,000 square feet or
approximately 10% of the building's leasable square footage expire and it
is expected that the tenants will vacate. The manager has signed leases
with two tenants totaling approximately 22,000 square feet or approximately
9% of the building. The Lower Manhattan market remains very competitive.
However, as evidenced by recent leasing at the property, leasing activity
has improved. Effective rental rates achieved remain depressed. The
property is expected to produce a small amount of cash flow for the
Partnership and its affiliated partner in 1996.
SAN JOSE
In March 1996, the sale of one of the parking structures in the San
Jose Plaza office complex to the Redevelopment Agency of the City of San
Jose was consummated pursuant to a negotiated agreement to resolve an
eminent domain action. Under the transfer agreement, San Jose received
replacement parking spaces for its tenants in a near-by city-owned parking
structure for a term of fifty-five years in addition to the purchase price
of $4,090,000. San Jose will recognize a gain of approximately $2,036,000
and $1,857,000, respectively, for financial reporting and Federal income
tax purposes in 1996, of which approximately $1,018,000 and $928,000,
respectively, will be allocable to the Partnership.
In March 1996, San Jose sold the 190 San Fernando Building to an
independent third party. The sale price of the building was $1,753,000,
paid in cash at closing. San Jose will recognize a gain of approximately
$789,000 and $21,000, respectively, for financial reporting purposes and
Federal income tax purposes in 1996, of which approximately $394,500 and
$10,500, respectively, will be allocable to the Partnership.
The 190 San Fernando Building and the parking structure were
classified as held for sale or disposition as of January 1, 1996 and
therefore have not been subject to continued depreciation. The
accompanying consolidated financial statements include the Partnership's
share of operations of unconsolidated ventures which include approximately
$20,000 and $5,000 of operations of such properties for the nine months
ended September 30, 1996 and 1995. Such assets had a net carrying value of
approximately $3,006,000 at December 31, 1995.
San Jose has completed a voluntary upgrade to the 130 Park Center
Plaza building and the parking garage below the 100-130 buildings for
seismic purposes. The cost of the structural upgrade was approximately
$1,200,000 of which the Partnership's share was approximately $600,000.
PLAZA HERMOSA SHOPPING CENTER
Occupancy at Plaza Hermosa at September 30, 1996 was approximately
92%. However, included in the occupancy percentage is a tenant, currently
in bankruptcy, whose lease had expired in 1995 (approximately 6,800 square
feet or 7% of the property) but remains in the center and pays rent
pursuant to its original lease terms on a month-to-month basis. In
addition, new leases will likely require expenditures for lease commissions
and tenant improvements prior to tenant occupancy. These anticipated costs
upon re-leasing will result in a decrease in cash flow from operations over
the near-term. Although the Partnership has begun marketing the property
for sale, there can be no assurance any such sale will be finalized in the
near-term.
FIRST FINANCIAL
On September 11, 1996, the joint venture sold the First Financial
office building to an unaffiliated third-party for a sale price of
$37,900,000, before selling expenses and prorations. The joint venture
received approximately $13,000,000 of net sale proceeds (which reflected
the assumption by the buyer of the mortgage loan with a current balance of
approximately $24,700,000), substantially all of which was allocable to
JMB/First Financial pursuant to the Encino Venture agreement. The sale
resulted in approximately $2,845,000 of gain for financial reporting
purposes in 1996, of which approximately $1,589,000 was allocated to the
Partnership.
In order to finalize the two year loan extension of the property's
mortgage loan in November 1995, the Partnership and its affiliated partner
loaned in late 1995 $4.0 million (approximately $2.5 million by the
Partnership) to the joint venture to fund the required principal payment.
A capital call had been made on the unaffiliated joint venture partner for
its share of the total required amount; however, the unaffiliated joint
venture partner indicated that it did not intend to fund its required
share. The Partnership and its affiliated partner reached an agreement
with the unaffiliated partner to modify the joint venture agreement. In
April of 1996, the unaffiliated partner became a limited partner as a
result of this modification.
The property was classified as held for sale or disposition as of
April 1, 1996, and therefore, has not been subject to continued
depreciation. The accompanying consolidated financial statements include
approximately $3,915,000 and $4,676,000 of revenues and $3,546,000 and
$4,828,000 of operating expenses with respect to the property for the nine
months ended September 30, 1996 and 1995, respectively. The property had a
net carrying value of $33,604,000 at December 31, 1995.
ADJUSTMENTS
In the opinion of the Managing General Partner, all adjustments (con-
sisting solely of normal recurring adjustments) necessary for a fair
presentation have been made to the accompanying figures as of September 30,
1996 and for the three and nine months ended September 30, 1996 and 1995.
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reference is made to the notes to the accompanying financial
statements for additional information concerning certain of the
Partnership's investments.
During the second quarter some of the Limited Partners in the
Partnership received from an unaffiliated third party an unsolicited tender
offer to purchase up to 9,169 Interests in the Partnership at between $150
and $170 per Interest. The Partnership recommended against acceptance of
this offer on the basis that, among other things, the offer price was
inadequate. In June such offer expired with approximately 2,009 Interests
being purchased by such unaffiliated third party pursuant to such offer.
In addition, the Partnership has, from time to time, received inquiries
from other third parties that may consider making offers for Interests,
including requests for the list of Limited Partners in the Partnership.
These inquiries are generally preliminary in nature. There is no assurance
that any other third party will commence an offer for Interests, the terms
of any such offer or whether any such offer, if made, will be consummated,
amended or withdrawn. The board of directors of JMB Realty Corporation
("JMB") the managing general partner of the Partnership, has established a
special committee (the "Special Committee") consisting of certain directors
of JMB to deal with all matters relating to tender offers for Interests in
the Partnership, including any and all responses to such tender offers.
The Special Committee has retained independent counsel to advise it in
connection with any potential tender offers for Interests and has retained
Lehman Brothers Inc. as financial advisor to assist the Special Committee
in evaluating and responding to any additional potential tender offers for
Interests.
As of September 30, 1996, the Partnership had consolidated cash and
cash equivalents of approximately $31,203,000, of which approximately
$27,654,000 is held by the Partnership. Of the remaining $3,549,000 (held
by the Partnership's consolidated joint ventures) approximately $2,117,000
represents the Partnership's share of undistributed cash. These funds and
the Partnership's cash are available for distributions to partners, tenant
improvements, leasing commissions, and other expenditures including its
share of the costs for a possible expansion and mall enhancement at Topanga
Plaza Shopping Center and/or to reduce the letter of credit enhancing the
$6,400,000 loan at Plaza Hermosa Shopping Center as such letter of credit
will require renegotiation or reissuance upon its expiration in December
1997. The Partnership anticipates making a distribution of sale proceeds
of $42 per Interest from the sale of the First Financial Plaza office
building in November 1996.
In an effort to reduce Partnership operating expenses, the Partnership
will make semi-annual rather than quarterly distributions of available
operating cash flow commencing with the 1996 distributions. After
reviewing the remaining properties and the marketplaces in which they
operate, the General Partners of the Partnership expect to be able to
conduct an orderly liquidation of its remaining investment portfolio as
quickly as practicable. Therefore, the affairs of the Partnership are
expected to be wound up no later than December 31, 1999 (sooner if the
properties are sold in the near-term), barring unforeseen economic
developments.
RESULTS OF OPERATIONS
The increase in cash and cash equivalents at September 30, 1996 as
compared to December 31, 1995 is primarily due to the temporary investment
of approximately $8,100,000 of sales proceeds received by the Partnership
as a result of the sale of the First Financial office building in September
1996.
The decreases in rents and other receivables, land, buildings and
improvements, accumulated depreciation, deferred expenses, accrued rents
receivable, current portion of long-term debt, tenant security deposits,
long-term debt less current portion and venture partners' subordinated
equity in ventures at September 30, 1996 as compared to December 31, 1995
are primarily due to the sale of the First Financial office building in
September 1996. The decrease in buildings and improvements was partially
offset by approximately $823,000 of tenant improvements at the 40 Broad
Street and Topanga Plaza investment properties.
The increase in prepaid expenses at September 30, 1996 as compared to
December 31, 1995 is primarily due to the prepayment of real estate tax and
insurance expenses at the 40 Broad Street and Topanga Plaza investment
properties.
The decrease in investment in unconsolidated ventures, at equity at
September 30, 1996 as compared to December 31, 1995 is due to the receipt
of approximately $3,600,000 in distributions from the Partnership's
unconsolidated venture, partially offset by approximately $1,700,000
representing the Partnership's share of income from such unconsolidated
venture.
The decreases in rental income and venture partners' share of
ventures' operations for the three and nine months ended September 30, 1996
as compared to the three and nine months ended September 30, 1995 are
primarily due to the receipt of insurance proceeds of approximately
$2,800,000, in the third quarter of 1995, relating to business interruption
at the Topanga Plaza investment property following the earthquake in early
1994.
The decrease in interest income for the three and nine months ended
September 30, 1996 as compared to the three and nine months ended September
30, 1995 is primarily due to higher average invested balances in U.S.
Government obligations and higher effective yields earned on such
investments in 1995.
Mortgage and other interest decreased for the three and nine months
ended September 30, 1996 as compared to the three and nine months ended
September 30, 1995 primarily due to the sale of the First Financial office
building in September 1996 and the $4,000,000 loan paydown at First
Financial in 1995.
Depreciation expense and amortization of deferred expenses decreased
for the three and nine months ended September 30, 1996 as compared to the
three and nine months ended September 30, 1995 primarily due to First
Financial being classified as held for sale as of April 1, 1996 and the
provision for value impairment recorded at the Plaza Hermosa investment
property at September 30, 1995.
The increase in professional services for the three and nine months
ended September 30, 1996 as compared to the three and nine months ended
September 30, 1995 is primarily due to expenses incurred in connection with
tender offer matters as discussed above.
The decreases in general and administrative expenses for the three
months ended September 30, 1996 as compared to the three months ended
September 30, 1995 are attributable primarily to the timing of the
recognition of costs for certain outsourcing services, the recognition of
certain prior year reimbursable costs to affiliates of the General Partners
and the timing of the recognition of certain printing costs in 1996.
The provision for value impairment of $5,500,000 in 1995 is due to the
Partnership recording a provision for value impairment at the Plaza Hermosa
investment property at September 30, 1995.
The increase in Partnership's share of operations of unconsolidated
ventures for the three months ended September 30, 1996 as compared to the
three months ended September 30, 1995 is primarily due to the write-off of
receivables in 1995 related to a certain tenant at the San Jose investment
property.
The Partnership's share of gain on sale of investment properties from
unconsolidated venture of $1,412,610 in 1996 is due to the gain recognized
on the sale of the 190 San Fernando building and one of the parking
structures at the San Jose investment property.
The gain on sale of investment property of $1,588,763 in 1996 is due
to the gain on the sale of the First Financial investment property in
September 1996.
<TABLE>
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
OCCUPANCY
The following is a listing of approximate occupancy levels by quarter for the Partnership's investment
properties.
<CAPTION>
1995 1996
-------------------------------------------------------------
At At At At At At At At
3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31
---- ---- ---- ----- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1. Park Center Financial
Plaza (2) (2) (2)
San Jose, California . . . 74% 77% 76% 77% 85% 85% 87%
2. Topanga Plaza
Los Angeles, California. . 95% 96% 96% 98% 98% 94% 98%
3. 40 Broad Street
New York, New York . . . . 76% 77% 77% 77% 75% 78% 81%
4. Plaza Hermosa
Shopping Center (1) (1) (1) (1)
Hermosa Beach, California. 93% 93% 95% 93% 95% 93% 92%
5. First Financial Plaza
Encino (Los Angeles),
California . . . . . . . . 89% 86% 88% 89% 82% 83% N/A
<FN>
An "N/A" indicates that the property was sold and not owned by the Partnership at the end of the quarter.
(1) The percentage represents physical occupancy. Approximately 6,800 square feet is occupied by a
tenant, now in bankruptcy, whose lease expired during 1995 but continues to operate and occupy its
space pursuant to its original lease terms.
(2) Occupancy is now based on 410,000 square feet rather than 432,000 square feet due to the sale of
the 190 San Fernando building in March 1996.
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
3-A. The Prospectus of the Partnership dated August
23, 1985 as supplemented December 9, 1985 and January 10, pursuant to Rules
424 (b) and 424 (c), as filed with the Commission is hereby incorporated
herein by reference to Exhibit 3-A to the Partnership's report for December
31, 1992 on Form 10-K (File No. 0-16108) dated March 19, 1993.
3-B. Amended and Restated Agreement of Limited
Partnership set forth as Exhibit A to the Prospectus, which agreement is
hereby incorporated herein by reference to Exhibit 3-B to the Partnership's
report for December 31, 1992 on Form 10-K (File No. 0-16108) dated March
19, 1993.
3-C. Acknowledgement of rights and duties of the
General Partners of the Partnership between ABPP Associates, L.P. (a
successor Associated General Partner of the Partnership) and JMB Realty
Corporation as of December 31, 1995 is hereby incorporated herein by
reference to the Partnership's report for June 30, 1996 on Form 10-Q (File
No. 0-16108) dated August 9, 1996.
4-A. Mortgage loan agreement between Topanga and
Connecticut General Life Insurance Company dated January 31, 1992 relating
to Topanga Plaza in Los Angeles, California is hereby incorporated herein
by reference to Exhibit 4-A to the Partnership's report for December 31,
1992 on Form 10-K (File No. 0-16108) dated March 19, 1993.
4-B. Amended and restated mortgage loan agreement
between First Financial and The Prudential Insurance Company of America
dated November 21, 1995 relating to First Financial Plaza in Encino,
California is hereby incorporated herein by reference to the Partnership's
report for December 31, 1995 on Form 10-K (File No. 0-16108) dated March
25, 1996.
4-C. Mortgage loan modification agreement between
Topanga and Connecticut General Life Insurance dated January 31, 1993
relating to Topanga Plaza in Los Angeles, California is hereby incorporated
herein by reference to Exhibit 4 of the Partnership's report for September
30, 1993 on Form 10-Q (File No. 0-16108) dated November 11, 1993.
4-D. Letter of credit agreement between JMB Income
Properties, Ltd-XII and Dresdner Bank AG dated November 15, 1994 relating
to the letter of credit extension at Plaza Hermosa is hereby incorporated
herein by reference to the Partnership's report on Form 10-K (File No. 0-
16108) dated March 27, 1995.
4-E. Mortgage loan agreement, Amended and Restated
Deed of Trust, Security Agreement with assignment of Rents and Fixture
Filing and Real Estate tax escrow and Security Agreement between San Jose
and Connecticut General Life Insurance Co. dated November 30, 1994 is
hereby incorporated herein by reference to the Partnership's report on Form
10-K (File No. 0-16108) dated March 27, 1995.
10-A. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of Topanga Plaza in
Los Angeles, California, are hereby incorporated by reference to the
Partnership's report on Form 8-K (File No. 0-16108) dated December 31,
1985.
10-B. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of First Financial
Plaza in Encino, California are hereby incorporated by reference to the
Partnership's report on Form 8-K (File No. 0-16108) dated June 3, 1987.
10-C. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of 40 Broad Street in
New York, New York, are hereby incorporated by reference to the
Partnership's report on Form 8-K (File No. 0-16108) dated December 31,
1985.
10-D. Third Amendment to amended and restated
partnership agreement of JMB Encino Partnership L.P. dated April 24, 1996
between JMB First Financial Associates and JMB Encino Partnership are
hereby incorporated by reference to the Partnership's report on Form 10-Q
(File No. 0-16108) dated May 10, 1996.
10-E. Purchase Agreement and Amendments thereto dated
August 9, 1996 relating to the sale of First Financial Plaza by JMB Encino
Partnership, L.P. are hereby incorporated herein by reference to the
Partnership's report for September 11, 1996 on Form 8-K (File No. 0-16108)
dated September 26, 1996.
27. Financial Data Schedule
(b) The following report on Form 8-K has been filed during
the last quarter of the period covered by this report:
(i) The Partnership's report on Form 8-K (File No.
0-01618) for September 11, 1996 (describing the sale of the First Financial
Plaza in Encino (Los Angeles), California), was filed. This report was
dated September 26, 1996.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
JMB INCOME PROPERTIES, LTD. - XII
BY: JMB Realty Corporation
(Managing General Partner)
By: GAILEN J. HULL
Gailen J. Hull, Senior Vice President
Date:November 8, 1996
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person in the capacity
and on the date indicated.
GAILEN J. HULL
Gailen J. Hull, Principal Accounting Officer
Date:November 8, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 31,202,848
<SECURITIES> 0
<RECEIVABLES> 3,409,890
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 34,612,738
<PP&E> 145,908,327
<DEPRECIATION> 44,702,207
<TOTAL-ASSETS> 148,459,707
<CURRENT-LIABILITIES> 3,002,812
<BONDS> 63,749,736
<COMMON> 0
0
0
<OTHER-SE> 64,460,536
<TOTAL-LIABILITY-AND-EQUITY>148,459,707
<SALES> 21,949,421
<TOTAL-REVENUES> 22,817,386
<CGS> 0
<TOTAL-COSTS> 13,955,975
<OTHER-EXPENSES> 604,259
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,150,810
<INCOME-PRETAX> 2,106,342
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,761,718
<DISCONTINUED> 3,001,373
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,763,091
<EPS-PRIMARY> 24.58
<EPS-DILUTED> 24.58
</TABLE>
