FORM 10-Q--QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
(As last amended by 34-32231, eff. 6/3/93.)
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of The Securities
Exchange Act of 1934
For the quarterly period ended March 31, 1996
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period.........to.........
Commission file number 0-15347
GROWTH HOTEL INVESTORS
(Exact name of small business issuer as specified in its charter)
California 94-2964750
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Insignia Financial Plaza
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's phone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports ), and (2) has been
subject to such filing requirements for the past 90 days. Yes X . No .
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) GROWTH HOTEL INVESTORS
CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
<S> <C> <C>
Assets
Cash and cash equivalents $ 3,533 $ 3,600
Restricted cash 197 189
Deferred costs 718 739
Receivables and other assets 586 231
Investment in unconsolidated joint venture 8,385 8,153
Investment properties:
Land 3,098 3,098
Buildings and related personal
property 20,420 20,234
23,518 23,332
Less accumulated depreciation (8,943) (8,734)
14,575 14,598
Total assets $ 27,994 $ 27,510
Liabilities and Partners' Deficit
Accounts payable and other liabilities $ 601 $ 562
Notes payable 5,429 5,433
Minority interest in joint ventures 73 76
Partners' Equity (Deficit):
General partner (1,003) (1,034)
Limited partners' (36,932 units outstanding
at March 31, 1996 and December 31, 1995) 22,894 22,473
Total partners' equity $ 21,891 $ 21,439
Total liabilities and partners' equity $ 27,994 $ 27,510
<FN>
See Notes to Consolidated Financial Statements
</TABLE>
b) GROWTH HOTEL INVESTORS
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Revenues:
Hotel operations $ 1,624 $ 1,658
Equity in unconsolidated joint venture
operations 486 285
Interest and other revenue 32 48
Total revenues 2,142 1,991
Expenses:
Hotel operations 1,141 1,096
Interest 169 206
Depreciation 208 155
General and administrative 175 130
Total expenses 1,693 1,587
Net income before minority interest in joint
ventures' operations $ 449 $ 404
Minority interest in joint ventures'
operations 3 (11)
Net income $ 452 $ 393
Net income allocated to general partners $ 31 $ 27
Net income allocated to limited partners 421 366
Net income $ 452 $ 393
Net income per limited partnership unit $ 11.39 $ 9.91
<FN>
See Notes to Consolidated Financial Statements
</TABLE>
c) GROWTH HOTEL INVESTORS
CONSOLIDATED STATEMENT OF PARTNERS' EQUITY
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Limited General Limited
Partnership Partners' Partners' Total
Units Deficit Equity Equity
<S> <C> <C> <C> <C>
Partners' (deficit) equity at
December 31, 1995 36,932 $(1,034) $ 22,473 $ 21,439
Net income for the three months
ended March 31, 1996 -- 31 421 452
Partners' (deficit) equity at
March 31, 1996 36,932 $(1,003) $ 22,894 $ 21,891
<FN>
See Notes to Consolidated Financial Statements
</TABLE>
d) GROWTH HOTEL INVESTORS
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
(in thousands, except for unit data)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income $ 452 $ 393
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation and Amortization 230 177
Equity in unconsolidated joint venture
operations (486) (285)
Minority interest in joint ventures' operations (3) 11
Deferred income -- (13)
Deferred costs paid -- (775)
Change in accounts:
Receivables and other assets (101) (43)
Accounts payable and other liabilities 39 (26)
Net cash provided by (used in) operating activities 131 (561)
Cash flows from investing activities:
Properties and improvements additions (186) (310)
Unconsolidated joint venture distributions -- 322
Restricted cash increase (decrease) (8) 113
Cash (used in) provided by investing activities (194) 125
Cash flows from financing activities:
Due to an affiliate -- 692
Notes payable principal payments (4) (9)
Cash (used in) provided by financing activities (4) 683
Net increase (decrease) in cash and cash equivalents (67) 247
Cash and cash equivalents at beginning of period 3,600 4,899
Cash and cash equivalents at end of period $ 3,533 $ 5,146
Supplemental information:
Interest paid $ 123 $ 204
<FN>
See Notes to Consolidated Financial Statements
</TABLE>
e)
GROWTH HOTEL INVESTORS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note A - Basis of Presentation
The accompanying unaudited 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
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of the General Partner, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three month period
ended March 31, 1996, are not necessarily indicative of the results that may be
expected for the fiscal year ending December 31, 1996. For further information,
refer to the financial statements and footnotes thereto included in the
Partnership's annual report on Form 10-K for the year ended December 31, 1995.
The balance sheet at December 31, 1995 was derived from audited financial
statements at such date.
Certain reclassifications have been made to the 1995 information to conform to
the 1996 presentation.
Note B - Transactions with Affiliated Parties
Growth Hotel Investors (the "Partnership") has no employees and is dependent on
NPI Realty Management Corp.("NPI Realty") or the "Managing General Partner") and
its affiliates for the management and administration of all partnership
activities. The Partnership Agreement provides for certain expenses incurred by
affiliates on behalf of the Partnership. The following transactions with
affiliates of Insignia Financial Group, Inc., National Property Investors, Inc.
("NPI"), and affiliates of NPI were charged to expense in 1996 and 1995:
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Reimbursement for services of affiliates (included
in general and administrative expenses) $73,000 $33,000
</TABLE>
The general partner is Montgomery Realty Company-85 ("MRC-85"), a California
general partnership. The general partners of MRC-85 are Fox Realty Investors
("FRI"), a California general partnership, and NPI Realty. On February 13,
1996, NPI Realty, which acquired its interest in MRC-85 from Montgomery Realty
Corporation on November 15, 1995, became the managing general partner of MRC-85.
On December 6, 1993, NPI Equity Investments II, Inc. ("NPI Equity") became the
managing general partner of FRI and assumed operational control over Fox Capital
Management Corporation ("FCMC"), an affiliate of FRI. As a result, NPI Equity
became responsible for the operation and management of the business affairs of
the Partnership and the other investment partnerships sponsored by FRI and/or
FCMC. The individuals who had served previously as partners of FRI and as
officers and directors of FCMC contributed their general partnership interests
in FRI to a newly formed limited partnership,
Note B - Transactions with Affiliated Parties (continued)
Portfolio Realty Associates L.P. ("PRA"), in exchange for limited partnership
interests in PRA. In the foregoing capacity, such partners continue to hold,
indirectly, certain economic interests in the Partnership and such other
partnerships, but ceased to be responsible for the operation and management of
the Partnership and such other partnerships. NPI Equity and NPI Realty are
wholly-owned subsidiaries of NPI.
On August 17, 1995, the stockholders of NPI entered into an agreement to sell
all of the issued and outstanding common stock of NPI to IFGP Corporation, an
affiliate of Insignia Financial Group, Inc. ("Insignia"). The transaction was
consummated on January 19, 1996. Upon the closing, the officers and directors
of NPI, NPI Equity II and NPI Realty resigned and IFGP Corporation caused new
officers and directors of each of those entities to be elected.
Note C - Restricted Cash
Restricted cash at March 31, 1996, and December 31, 1995, represents funds
provided for and maintained by certain properties pursuant to the related notes
payable agreements, to meet future capital requirements and debt service
payments.
Note D - Amendment to Service Agreement
The Partnership paid $775,000 in January 1995 to Metric Management, Inc. ("MMI")
amending their services agreement to provide for a reduction in the monthly
asset management fee from $29,750 to $5,500. This amendment eliminated fees
payable to MMI for its assistance in refinancing and sales of properties owned
by the Partnership and provides the Partnership with the ability to terminate
MMI's services at will.
The buyout of the service contract is being amortized over the remaining term of
the services agreement of 10 years. For the three months ended March 31, 1996
and 1995, $19,000 has been amortized and is included in general and
administrative expenses.
Note E - Investment in Unconsolidated Joint Venture
The following are the condensed balance sheet as of March 31, 1996, and December
31, 1995, and condensed statements of operations for the three months ended
March 31, 1996 and 1995 for the Partnership's investment in Growth Hotel
Investors Combined Fund No. 1 (the "Combined Fund"), which is reported under the
equity method of accounting.
GROWTH HOTEL INVESTORS COMBINED FUND NO. I
CONDENSED BALANCE SHEETS
(Unaudited)
(in thousands)
March 31, December 31,
1996 1995
Assets
Cash and cash equivalents $ 3,560 $ 3,657
Restricted cash 818 570
Deferred costs and other assets 1,729 1,100
Investment Properties
Land 10,369 10,369
Buildings and related personal property 78,245 77,031
Less:
Accumulated depreciation (28,296) (27,313)
Investment properties, net 60,318 60,087
Total assets $ 66,425 $ 65,414
Liabilities and Partners' Capital
Accounts payable and other liabilities $ 1,869 $ 1,552
Due to an affiliate of the joint
venture partner 1,707 756
Notes payable 40,650 40,836
Minority interest in consolidated
joint venture (4,839) (4,037)
Partners' Equity
GHI 8,385 8,153
GHI II 18,653 18,154
Total partners' equity 27,038 26,307
Total Liabilities and Partners' Equity $ 66,425 $ 65,414
Note E - Investment in Unconsolidated Joint Venture (continued)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
Three Months Ended
March 31,
1996 1995
Revenues $ 8,778 $ 8,375
Expenses (7,441) (7,111)
Income before minority interest in joint
venture's operations 1,337 1,264
Minority interest in joint venture's
operations 195 (367)
Net income $ 1,532 $ 897
Allocation of income:
GHI $ 486 $ 285
GHI II 1,046 612
Net income $ 1,532 $ 897
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Investment Properties:
A description of the hotel properties in which the Partnership has an ownership
interest, together with occupancy and room rate data follows:
<TABLE>
<CAPTION>
Average Average Daily
Occupancy Rate Room Rate
For Quarter Ended For Quarter Ended
March 31, March 31,
Name and Location 1996 1995 1996 1995
<S> <C> <C> <C> <C>
Growth Hotel Investors I:
Hampton Inn-Syracuse 44% 49% $57.32 $51.88
East Syracuse, New York
Hampton Inn-Brentwood 76% 75% 66.24 55.65
Nashville, Tennessee
Hampton Inn-Aurora 68% 76% 59.75 53.22
Aurora, Colorado
Hampton Inn-Albuquerque North 69% 76% 56.85 52.49
Albuquerque, New Mexico
Growth Hotel Investors
Combined Fund No. 1:
Hampton Inn-Memphis I40 East 65% 71% 53.20 50.36
Memphis, Tennessee
Hampton Inn-Columbia-West 73% 82% 58.96 53.03
West Columbia, South Carolina
Hampton Inn-Spartanburg 54% 63% 51.61 46.23
Spartanburg, South Carolina
Hampton Inn-Little Rock, North 64% 72% 51.37 46.78
North Little Rock, Arkansas
Hampton Inn-Amarillo 59% 64% 49.70 46.68
Amarillo, Texas
Average Average Daily
Occupancy Rate Room Rate
For Quarter Ended For Quarter Ended
March 31, March 31,
Name and Location 1996 1995 1996 1995
Growth Hotel Investors
Combined Fund No. 1:
(continued)
Hampton Inn-Greenville 76% 77% $ 57.79 $ 51.92
Greenville, South Carolina
Hampton Inn-Charleston-Airport 74% 70% 53.57 52.76
North Charleston, South Carolina
Hampton Inn-Memphis-Poplar 79% 80% 67.95 63.00
Memphis, Tennessee
Hampton Inn-Greensboro 77% 85% 63.42 55.79
Greensboro, North Carolina
Hampton Inn-Birmingham 71% 80% 60.51 57.17
Birmingham, Alabama
Hampton Inn-Atlanta-Roswell 75% 81% 63.36 55.86
Roswell, Georgia
Hampton Inn-Chapel Hill 81% 81% 60.29 54.68
Chapel Hill, North Carolina
Hampton Inn-Dallas-Richardson 78% 71% 55.60 50.25
Richardson, Texas
Hampton Inn-Nashville- 67% 81% 64.66 59.20
Briley Parkway
Nashville, Tennessee
Hampton Inn-San Antonio-Northwest 54% 59% 55.87 56.28
San Antonio, Texas
Hampton Inn-Madison Heights 69% 63% 57.38 53.19
Madison Heights, Michigan
Hampton Inn-Mountain Brook 77% 68% 60.78 56.40
Birmingham, Alabama
Hampton Inn-Northlake 78% 77% 60.22 53.34
Atlanta, Georgia
The Partnership's net income for the three months ended March 31, 1996 was
approximately $452,000 as compared to $393,000 for the corresponding period of
1995. The increase in net income is attributable to an increase in equity in
unconsolidated joint venture operations. The increase in earnings from the
joint venture is due to an increase in hotel revenues due to an overall room
rate increase at the investment properties. In additon to the increase in the
Partnership's equity in earnings of the joint venture, the Partnership had a
decrease in mortgage interest due to the repayment of long-term debt on the
Partnership's Hampton Inn - Brentwood property during the fourth quarter of
1995. Partially offsetting these increases to income were increases in hotel
operating expenses, depreciation expense and general and administrative
expenses.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the hotel market environment of its investment properties to
assess the feasibility of increasing rates, maintaining or increasing occupancy
levels and protecting the Partnership from increases in expenses. As part of
this plan, the Managing General Partner attempts to protect the Partnership from
the burden of inflation-related increases in expenses by increasing rates and
maintaining a high overall occupancy level. However, due to changing market
conditions, which can result in the use of concessions and room rate reductions
to offset softening market conditions, there is no guarantee that the Managing
General Partner will be able to sustain such a plan.
At March 31, 1996, the Partnership had unrestricted cash of $3,533,000 as
compared to $5,146,000 at March 31, 1995. Net cash provided by operating
activities increased due to the increase in net income discussed above along
with the Partnership incurring costs of $775,000 during the first quarter of
1995 in relation to a buyout agreement as discussed in "Item 1. Financial
Statements Note D". Net cash used in investing activities increased for the
three month period ended March 31, 1996, in comparison to the three month period
ended March 31, 1995, due to the difference in the timing of the receipt of
distributions from its unconsolidated joint venture. Distributions will be
received in the second quarter of 1996 as compared to the first quarter of 1995.
Net cash used in financing activities increased primarily as a result of an
increase in the amounts due to affiliates in the first quarter of 1995.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Partnership. Such assets are currently
thought to be sufficient for any near-term needs of the Partnership. The
mortgage indebtedness of approximately $5,429,000 includes mortgages with
maturity dates in 1997. A balloon payment on the mortgage encumbering the
Partnership's Hampton Inn - Aurora property is due in May 1997 in the amount of
approximately $3,034,000. The Partnership's Hampton Inn - Albuquerque has a
balloon payment due in May 1997, in the amount of approximately $2,375,000.
Future cash distributions will depend on the levels of cash generated from
operations, property sales and the availability of cash reserves. The Managing
General Partner is currently evaluating the feasibility of selling all of the
investment properties (as discussed in further detail below) or the refinancing
opportunities. The General Partner is evaluating the possibility of making a
cash distribution in the second quarter of 1996.
On February 15, 1996, Devon Associates, a New York general partnership,
commenced a tender offer (the "Offer") for up to 15,000 of the outstanding Units
at a purchase price of $705.00 per Unit. Due to the participation in the tender
offer by affiliates of NPI Realty, and the Managing General Partner's related,
existing and potential conflicts of interest, the Partnership, in its Schedule
14D-9 filed with Securities and Exchange Commission and sent to limited
partners, expressed no opinion and made no recommendation as to whether limited
partners should tender their Units pursuant to the Offer. The expiration of the
tender offers described above was midnight, New York time, on March 25, 1996.
See Items 2-4 of the Schedule 14D-9 of the Partnership, as filed with the
Commission on February 29, 1996, as amend by "Amendment No. 1" thereto, as filed
with the Commission on March 7, 1996, and as further amended by "Amendment No.
2" thereto, as filed with the Commission on March 14, 1996 and as further
amended by "Amendemnt No. 3" thereto filed with the Commission on March 18, 1996
(collectively, the "Schedule 14D-9"), for additional information with respect to
the Offer and the current and potential conflicts of interest of MRC-85, which
Items 2-4 are incorporated herein by reference. Devon Associates acquired
13,396 units with respect to this offer. See Part II Item I - Legal Proceedings.
On March 12, 1996, the Partnership received a letter advising that the
Partnership's and GHI II's joint venture partner in certain of the hotel
properties was offering $147,400,000 in cash for all of the 28 hotel properties
directly or indirectly owned by the Partnership and GHI II. See "Amendment No.
2" to the Partnership's Statement on Schedule 14D-9, as filed with the
Commission on March 14, 1996, for a more complete description of this offer,
which "Amendment No. 2" is hereby incorporated by reference herein. The
Managing General Partner did not accept the terms of the offer and, by its
terms, the offer expired unaccepted on March 31, 1996.
PART II - OTHER INFORMATION
ITEM 1. Legal Proceeding
William Wallace, Mildred Wallace, Edith G. Martin, Paul Allemang and Gwen
Allemang, on behalf of themselves and all others similarly situated, and
derivatively on behalf of Growth Hotel Investors, a California limited
partnership and Growth Hotel Investors II ("GHI II"), a California limited
partnership, Plaintiff v. Devon Associates, Montgomery Realty-85, GHI
Associates, Cayuga Associates, L.P., Cayuga Capital Corp., Insignia Financial
Group, Inc., L.P., and Fleetwood Corp., Defendants and Growth Hotel Investors, a
California Limited partnership, and Growth Hotel Investors II, a California
limited partnership, Nominal Defendant, Supreme Court of the State of New York,
County of New York, Case No. 9600866. (the "Wallace Action").
On February 21, 1996, William and Mildred Wallace, holders of Units of GHI, and
Edith G. Martin and Paul and Gwen Allemang, holders of Units of the Partnership,
commenced an action on behalf of themselves and others similarly situated, and
derivatively on behalf of GHI and the Partnership, in the Supreme Court of the
State of New York, County of New York, against, among others, MRC-85 and certain
of its affiliates pertaining to the tender offer for up to 21,000 partnership
Units of GHI II and up to 15,000 partnership Units of the Partnership which
commenced February 15, 1996. The action alleged, among other things, that the
tender offers constituted (a) a breach of fiduciary duty owed to limited
partners and the partnerships, and (b) a breach of the provisions of the
partnership agreements of such partnerships. The action, which was brought as a
class action on behalf of all limited partners, sought to enjoin the tender
offers as well as monetary damages in an unspecified amount.
R&S Asset Partners, a Florida general partnership, and Jessie B. Small, on their
own behalves, on behalf of all others similarly situated, and derivatively on
behalf of the Nominal Defendants, Plaintiffs, v. Devon Associates, Cayuga
Associates, L.P., Cayuga Capital Corp., Fleetwood Corp., Carl C. Icahn, Michael
L. Ashner, Martin Lifton, Arthur N. Queler, Insignia Financial Group, Inc.,
IFGP, Corp., National Properties Investors, Inc., NPI Equity Investment II,
Inc., Fox Fealty Investors, Portfolio Realty Associates, L.P., Emmet J. Cashin,
Jr., Jarold A. Evans, W. Patrick McDowell, Apollo Real Estate Advisors, L.P.,
and Montgomery Realty Company-85, Defendants, and Growth Hotel Investors, a
California Limited Partnership, and Growth Hotel Investors II, a California
Limited Partnership, Nominal Defendants, Superior Court of the State of
California, County of Los Angeles, Case No. BC145220 (the "R&S Asset Partners
Action").
On February 28, 1996, R&S Asset Partners, holders of Units of GHI, and Jesse B.
Small, holder of Units of the Partnership, commenced an action on behalf of
themselves and others similarly situated, and derivatively on behalf of GHI and
the Partnership, in the Superior Court of the State of California, County of Los
Angeles, against, among others, MRC-85 and certain of its affiliates pertaining
to the tender offer for up to 21,000 partnership Units of GHI II and up to
15,000 partnership Units of the Partnership which commenced February 15, 1996.
The action alleged, among other things, that the tender offers constituted (a) a
breach of fiduciary duty owed to the limited partners of the partnerships, (b)
negligent misrepresentations pertaining to the disclosure set forth in the offer
to purchase, (c) common law fraud, and (d) a breach of the provisions of the
partnership agreements of such partnerships. The action, which was brought as a
class action on behalf of all limited partners, sought to enjoin the tender
offers as well as monetary damages in an unspecified amount.
See Item 3 of the Schedule 14D-9, which is incorporated herein by reference, for
additional information with respect to the above actions.
On March 15, 1996, counsel for the plaintiffs and defendants in the Wallace
Action and the R&S Partners Actions agreed in principle to settle these actions.
In connection with the settlement MRC-85 agreed to take such actions as are
reasonably necessary and consistent with its fiduciary duties to procure offers
for the purchase of the Partnership's and GHI's assets which maximize the value
of the limited partner assignee units. MRC-85 further agreed to deal fairly and
in good faith with persons expressing an interest in making a bona fide offer to
purchase such assets and, subject to its fiduciary duty, provide such bona fide
offers with access to the Partership's and GHI's books and records for due
diligence purposes. If MRC-85 determines that an offer to purchase its assets
is acceptable MRC-85 will prepare a plan of liquidation and submit such plan to
the Partnership's partners for approval. Also in connection with the
settlement, the plaintiffs will release all claims they may have arising out of
the tender offers. The consummation of the settlement is subject to the
satisfaction of numerous conditions including court approval. Accordingly,
there can be no assurance that the settlement will be consummated on these terms
and conditions or at all.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibit 27, Financial Data Schedule, is filed as an exhibit to this report.
99(a) Schedule 14D-9 of the Registrant, as filed with the Commission on
February 29, 1996.
99(b) Amendment No. 1 to Schedule 14D-9 of the Registrant, as filed with the
Commission on March 7, 1996.
99(c) Amendment No. 2 to Schedule 14D-9 of the Registrant, as filed with the
Commission on March 14, 1996.
99(d) Amendment No. 3 to Schedule 14D-9 of the Registrant, as filed with the
Commission on March 18, 1996.
b) Reports on Form 8-K: Form 8-K dated January 19, 1996, was filed reporting
the change in control of the Partnership.
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.
GROWTH HOTEL INVESTORS
By: MONTGOMERY REALTY COMPANY-85,
its general partner
/s/William H. Jarrard, Jr.
President and Director
/s/Ronald Uretta
Principal Financial Officer
and Principal Accounting Officer
Date: May 15, 1996
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Growth
Hotel Investors 1996 First Quarter 10-Q and is qualified in its
entirety by reference to such 10-Q filing.
</LEGEND>
<CIK> 0000769129
<NAME> GROWTH HOTEL INVESTORS
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 3,533
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 23,518
<DEPRECIATION> 8,943
<TOTAL-ASSETS> 27,994
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 5,429
0
0
<COMMON> 0
<OTHER-SE> 21,891
<TOTAL-LIABILITY-AND-EQUITY> 27,994
<SALES> 0
<TOTAL-REVENUES> 2,142
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,693
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 169
<INCOME-PRETAX> 452
<INCOME-TAX> 0
<INCOME-CONTINUING> 452
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 452
<EPS-PRIMARY> .01
<EPS-DILUTED> 0
<FN>
<F1>The Registrant has an unclassified balance sheet.
</FN>
</TABLE>
