<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended March 31, 1996 Commission File No. 0-15940
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
MICHIGAN 38-2593067
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
280 DAINES STREET, BIRMINGHAM, MICHIGAN 48009
(Address of principal executive offices) (Zip Code)
(810) 645-9261
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(g) of the Act:
$1,000 per unit, units of limited partnership interest
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
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP
INDEX
Page
----
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Balance Sheets
March 31, 1996 (Unaudited) and
December 31, 1995 3
Statements of Income
Three months ended March 31, 1996
and 1995 4
Statements of Cash Flows
Three months ended March 31, 1996
and 1995 (Unaudited) 5
Notes to Financial Statements
March 31, 1996 (Unaudited) 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS 7
PART II OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 10
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<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP
BALANCE SHEETS
<TABLE>
<CAPTION>
ASSETS MARCH 31, 1996 DECEMBER 31, 1995
(UNAUDITED)
<S> <C> <C>
Properties:
Land $5,280,000 $5,280,000
Buildings And Improvements 22,101,235 22,087,145
Manufactured Homes 408,557 412,052
Furniture And Fixtures 94,337 98,320
----------- -----------
27,884,129 27,877,517
7,410,050 7,214,093
----------- -----------
Less Accumulated Depreciation
20,474,079 20,663,424
Cash And Cash Equivalents 399,510 468,664
Other Assets 660,359 690,477
----------- -----------
Total Assets $21,533,948 $21,822,565
----------- -----------
<CAPTION>
LIABILITIES MARCH 31, 1996 DECEMBER 31, 1995
(UNAUDITED)
<S> <C> <C>
Accounts Payable $154,693 $170,213
Line of Credit 343,210 $343,210
Other Liabilities 661,142 973,542
----------- -----------
Total Liablities $1,159,045 $1,486,965
Partners' Equity
General Partner (415,105) (603,574)
Class A Limited Partners 11,915,233 12,064,399
Class B Limited Partners 8,874,775 8,874,775
----------- -----------
Total Partners' Equity 20,374,903 20,335,600
----------- -----------
Total Liabilities And
Partners' Equity $21,533,948 $21,822,565
----------- -----------
</TABLE>
See Notes to Financial Statements
3
<PAGE> 4
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP
STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31, 1996 MARCH 31, 1995
<S> <C> <C>
Income:
Rental Income $1,875,625 $1,787,454
Other 86,177 87,979
---------- ----------
Total Income $1,961,802 $1,875,433
---------- ----------
Operating Expenses:
Administrative Expenses
(Including $97,708 And $93,365
In Property Management Fees Paid
To An Affliate For The Three Month
Period March 31, 1996 and
1995, Respectively) 422,592 392,437
Property Taxes 204,168 197,358
Utilities 129,729 127,033
Property Operations 220,053 180,677
Depreciation And Amortization 195,957 192,102
---------- ----------
Total Operating Expenses $1,172,499 $1,089,607
---------- ----------
Net Income $789,303 $785,826
---------- ----------
Income Per Limited Partnership Unit:
Class A $18.00 $18.00
Class B $25.00 $25.00
Distribution Per Limited Partnership Unit
Class A $25.00 $25.00
Class B $25.00 $25.00
Weighted Average Number Of Limited
Partnership Units Outstanding
Class A 20,230 20,230
Class B 9,770 9,770
</TABLE>
See Notes to Financial Statements.
4
<PAGE> 5
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31, 1996 MARCH 31, 1995
<S> <C> <C>
Cash Flows From Operating Activities:
Net Income (Loss) $789,303 $785,826
Adjustments To Reconcile Net Income
(Loss) To Net Cash Provided By
Operating Activities:
Depreciation 195,957 192,102
(Increase) Decrease In Other Assets From Operations 30,118 9,062
Increase (Decrease) In Accounts Payables (15,520) (48,936)
Increase (Decrease) Other Liabilities From Operations (312,400) 189,114
-------- --------
Total Adjustments (101,845) 341,342
-------- --------
Net Cash Provided By (Used In)
Operating Activities 687,458 1,127,168
-------- --------
Cash Flows From Investing Activities:
Capital Expenditures (6,612) (26,021)
-------- --------
Net Cash Provided By (Used In)
Investing Activities (6,612) (26,021)
-------- --------
Cash Flows From Financing Activities:
Distributions To Partners (750,000) (750,000)
-------- --------
Net Cash Provided By (Used In)
Financing Activities (750,000) (750,000)
-------- --------
Increase (Decrease) In Cash (69,154) 351,147
Cash, Beginning 468,664 373,168
-------- --------
Cash, Ending $399,510 $724,315
-------- --------
</TABLE>
See Notes to Financial Statements
5
<PAGE> 6
UNIPROP MANUFACTURED HOUSING COMMUNITIES INCOME FUND,
A MICHIGAN LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
March 31, 1996 (Unaudited)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Presentation:
The balance sheet as of March 31, 1996, the related statements of income and
statements of cash flow for the periods ended March 31, 1996 and 1995 have been
prepared by management, pursuant to the rules and regulations of the Securities
and Exchange Commission, without audit by independent public accountants. In
the opinion of management, all adjustments (consisting of only normal recurring
accruals) necessary for a fair presentation of such financial statements have
been included.
The financial statements and notes are presented as permitted by the rules and
regulations of the Securities and Exchange Commission for Form 10-Q and do not
contain certain information included in the Company's annual financial
statements and notes, which should be consulted.
2. PAYMENTS TO AFFILIATES:
THREE MONTHS ENDED
MARCH 31, 1996 MARCH 31, 1995
-------------- --------------
PROPERTY MANAGEMENT FEE
TO UNIPROP, INC.: $97,708 $93,365
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<PAGE> 7
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Capital Resources
The Partnership's capital resources consist primarily of its four manufactured
housing communities. There have been no significant capital transactions
during the quarter reported.
Liquidity
Partnership liquidity is based upon its investment strategy. The properties
owned by the Partnership were anticipated to be held for seven to ten years
after their acquisition. All of the properties have been owned by the
Partnership at least seven years. The General Partner may elect to have the
Partnership own the properties for longer than ten years, if, in the opinion
of the General Partner, it is in the best interest of the Partnership to do so.
During the second quarter of 1995, the Partnership extended the existing line
of credit with Comerica Bank from $200,000 to $400,000. Proceeds from the line
of credit are being used to purchase new or used manufactured homes for sale or
lease in the communities owned by the Partnership. As of March 31, 1996, the
outstanding balance on the line of credit was approximately $343,210.
During the quarters ended March 31, 1996 and 1995, cash generated by operations
was $985,260 and $977,928, respectively. This amount of cash flow provided
sufficient funds to distribute $750,000 to the Limited Partners subsequent to
the end of the quarter, providing the Limited Partners with their annualized
10% preferred return. Consequently, the cash available after the preferred
return to the Limited Partners amounts to $235,260 and $200,000 will be
distributed to the General Partner for the quarter ended March 31, 1996. For
the same quarter in 1995, the General Partner received $150,000.
While the Partnership is not required to maintain a working capital reserve,
the Partnership has not distributed all the cash generated from operations in
order to build cash reserves. For the quarter ended March 31, 1996, the
Partnership added $35,260 to reserves. During the same quarter in 1995, the
Partnership added $77,928 to cash reserves. The amount placed in reserves is
at the discretion of the General Partner.
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<PAGE> 8
Results of Operations
OVERALL, as illustrated in the tables below, the four properties enjoyed a
combined average occupancy of 95.9% (1,749/1,824 sites) at the end of March
1996, versus 95.1% a year ago. The average monthly rent in March 1996 was
approximately $370, or 3.1% more than the $359 average monthly rent in March
1995.
<TABLE>
<CAPTION>
Total Occupied Occupancy Average
Capacity Sites Rate Rent
<S> <C> <C> <C> <C>
Aztec Estates 645 618 95.8% $411
Kings Manor 314 299 95.2 388
Old Dutch Farms 293 289 98.6 373
Park of the Four Seasons 572 543 94.9 315
--- ---- ----- ----
Total on 3/31/96: 1,824 1,749 95.9% $370
Total on 3/31/95: 1,824 1,735 95.1% $359
</TABLE>
During the first quarter of 1996, the Partnership generated gross revenues of
$1,961,802, 4.6% more than the $1,875,433 generated in the first quarter of
1995. The net operating income before other non-recurring expenses and
Partnership administration was $1,113,377 or 56.7% of the total revenues,
versus $1,008,628 or 53.8% during the same period in 1995. For the quarter,
cash flow was $985,260, versus $977,928 reported in 1995.
<TABLE>
<CAPTION>
GROSS NET OPERATING
REVENUES INCOME
<S> <C> <C>
Aztec Estates $790,068 $409,510
Kings Manor 348,145 212,845
Old Dutch Farms 308,889 192,947
Park of the Four Seasons 511,056 298,075
Partnership Management: 3,644 (88,172)
Other Non-Recurring expenses: (39,945)
----------- --------------
Total on 3/31/96: $1,961,802 $985,260
Total on 3/31/95: $1,875,433 $977,928
</TABLE>
The Partnership operating expenses for the first quarter of 1996, compared to
the same period in 1995, reflect slight increases in wages, marketing expenses,
taxes and legal/professional fees.
-8-
<PAGE> 9
AZTEC ESTATES, in Margate, Florida, reported an occupancy on March 31, 1996 of
95.8% (618/645 sites), versus 98.1% as of March 31, 1995. The average rent in
the community as of March 31, 1996 was $411, versus $394, an increase of 4.3%
from the same period in 1995. For the first quarter of 1996, the net operating
income was $409,510, or 4.9% less than the $430,522 reported for the same
period in 1995. The decline in income is the result of higher marketing
expenses associated with the model home sales program.
Improvement and maintenance actions undertaken during the quarter involved
repairs to a damaged main water line and renovations to the community center
building and patio area. Management has budgeted approximately $100,000 for
capital improvements at Aztec during 1996. The most significant items budgeted
for are road repaving and new shuffle board courts.
KINGS MANOR, in Fort Lauderdale, Florida, reported an occupancy of 95.2%
(299/314 sites) on March 31, 1996, versus 98.1% as of March 31, 1995. The
average rent in the community as of March 31, 1996 was $388, versus $372, an
increase of 4.3% from the same period in 1995. For the first quarter of 1996,
the net operating income was $212,845, slightly more than the $212,681 reported
during the same period in 1995.
Improvement and maintenance actions undertaken during the quarter involved the
seal-coating of approximately one third of the residents' driveways within the
community, significant trimming and removal of older trees throughout the
community, and the installation of a new motor for the pool filter. Management
has budgeted approximately $60,000 of capital improvements for Kings Manor in
1996. The most significant budgeted item was $10,000 for seal-coating
residents' driveways. Also budgeted for 1996 is approximately $9,600 for
upgrading old electric pedestals.
OLD DUTCH FARMS, in Novi Michigan, reported an occupancy of 98.6% (289/293
sites) on March 31, 1996, versus 96.3% as of March 31, 1995. The average rent
in the community as of March 31, 1996 was $373, versus $362, an increase of
3.0% from the same period in 1995. For the first quarter of 1996, the net
operating income was $192,947 or 14.4% more than the $168,589 reported for the
same period in 1995. The increase in income is due to higher occupancy and the
higher average monthly rent.
Improvement and maintenance actions undertaken during the quarter consisted of
minor repairs to the sewer plant, installation of concrete piers for the new
homes that were moved into the community during the first quarter, and the
purchase and set-up of a new manager's home. Management has budgeted
approximately $71,000 in capital improvements during 1996. The most significant
items are $17,000 for a new manager's home and $20,000 for new street lights
throughout the community.
PARK OF THE FOUR SEASONS, in Blaine, Minnesota, reported an occupancy of 94.9%
(543/572 sites) on March 31, 1996 versus 89.5% as of March 31, 1995. The
average rent in the community as of March 31, 1996 was $315, versus $306, an
increase of 2.9% from the same period in 1995. For the first quarter of 1996,
the net operating income
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<PAGE> 10
$298,075, 4.0% more than the $286,471 reported for the same period in 1995.
The increase in income is due to higher occupancy and higher average monthly
rent.
Improvement and maintenance actions during the quarter consisted of repairs to
several water breaks, replacement of a HVAC unit in the community center
building, and renovations to the mens shower area.
MANAGEMENT EXPENSES
Net partnership management expenses paid during the quarter amounted to
$88,172. Gross expenses of $91,816 (data processing, accounting and legal
expenses, office supplies and wages to employees of the Partnership) were
partially offset by income of $3,644 generated by interest on the Partnership's
reserves and transfer fees. The figures for last year's first quarter were
$89,635, $94,068 and $4,433, respectively.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS OF FORM 8-K
(a) Exhibits
Exhibit Number Description
-------------- -----------------------
27 Financial Data Schedule
(b) Reports of Form 8-K
There were no reports filed on Form 8-K during
the three months ended March 31, 1996.
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<PAGE> 11
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Uniprop Manufactured Housing
Communities Income Fund,
A Michigan Limited Partnership
BY: P.I. Associates Limited Partnership,
A Michigan Limited Partnership,
its General Partner
BY: /s/ Paul M. Zlotoff
---------------------------------------------
Paul M. Zlotoff, General Partner
BY: /s/ Gloria A. Koster
---------------------------------------------
Gloria A. Koster, Principal Financial Officer
Dated: May 15, 1996
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<PAGE> 12
Exhibit Index
-------------
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 399,510
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,059,869
<PP&E> 27,884,129
<DEPRECIATION> 7,410,050
<TOTAL-ASSETS> 21,533,948
<CURRENT-LIABILITIES> 1,159,045
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 20,374,903
<TOTAL-LIABILITY-AND-EQUITY> 21,533,948
<SALES> 0
<TOTAL-REVENUES> 1,961,802
<CGS> 0
<TOTAL-COSTS> 976,542
<OTHER-EXPENSES> 195,957
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 789,303
<INCOME-TAX> 0
<INCOME-CONTINUING> 789,303
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 789,303
<EPS-PRIMARY> 18<F1>
<EPS-DILUTED> 25
<FN>
<F1> 5-03(b)(20) EPS Primary - In this Real Estate Limited Partnership there
are two classes of Limited Partnership units.
EPS-Primary is income per Class A Limited Partnership Unit
EPS-Diluted is income per Class B LP Unit
</FN>
</TABLE>
