FORM 10-QSB--QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
QUARTERLY OR TRANSITIONAL REPORT
U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 30, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from.........to.........
Commission file number 0-15676
DAVIDSON DIVERSIFIED REAL ESTATE III, L.P.
(Exact name of small business issuer as specified in its charter)
Delaware 62-1242599
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
55 Beattie Place
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone 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)
DAVIDSON DIVERSIFIED REAL ESTATE III, L.P.
CONSOLIDATED BALANCE SHEET
(in thousands, except unit data)
(Unaudited)
September 30, 1998
Assets
Cash and cash equivalents $ 108
Receivables and deposits 405
Restricted escrows 181
Other assets 372
Investment properties:
Land $ 2,821
Buildings and related personal property 31,513
34,334
Less accumulated depreciation (16,109) 18,225
$19,291
Liabilities and Partners' Deficit
Liabilities
Accounts payable $ 116
Tenant security deposit liabilities 107
Accrued property taxes 471
Other liabilities 202
Mortgage notes payable 23,766
Partners' Deficit
General partners $ (107)
Limited partners (1,011.5 units issued
and outstanding) (5,264) (5,371)
$19,291
See Accompanying Notes to Consolidated Financial Statements
b)
DAVIDSON DIVERSIFIED REAL ESTATE III, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
Revenues:
Rental income $ 1,380 $ 1,340 $ 4,018 $ 3,878
Other income 106 84 350 335
Total revenues 1,486 1,424 4,368 4,213
Expenses:
Operating 709 665 1,970 1,900
General and administrative 46 45 142 128
Depreciation 358 354 1,055 1,047
Interest 541 544 1,626 1,633
Property taxes 107 111 327 333
Total expenses 1,761 1,719 5,120 5,041
Net loss $ (275) $ (295) $ (752) $ (828)
Net loss allocated to
general partners (2%) $ (5) $ (6) $ (15) $ (17)
Net loss allocated to
limited partners (98%) (270) (289) (737) (811)
$ (275) $ (295) $ (752) $ (828)
Net loss per limited
partnership unit: $(266.93) $(285.71) $(728.62) $(801.78)
See Accompanying Notes to Consolidated Financial Statements
c)
DAVIDSON DIVERSIFIED REAL ESTATE III, L.P.
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' DEFICIT
(in thousands, except unit data)
(Unaudited)
Limited
Partnership General Limited
Units Partners Partners Total
Original capital contributions 1,013.0 $ 1 $20,240 $20,241
Partners' deficit at
December 31, 1997 1,011.5 $ (92) $(4,527) $(4,619)
Net loss for the nine months
ended September 30, 1998 -- (15) (737) (752)
Partners' deficit at
September 30, 1998 1,011.5 $ (107) $(5,264) $(5,371)
See Accompanying Notes to Consolidated Financial Statements
d)
DAVIDSON DIVERSIFIED REAL ESTATE III, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
Nine Months Ended
September 30,
1998 1997
Cash flows from operating activities:
Net loss $ (752) $ (828)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation 1,055 1,047
Amortization of mortgage discounts and loan costs 49 49
Change in accounts:
Receivables and deposits (150) (166)
Other assets 16 (48)
Accounts payable (93) (61)
Tenant security deposit liabilities 23 (24)
Accrued property taxes 193 193
Other liabilities (6) (93)
Net cash provided by operating activities 335 69
Cash flows used in investing activities:
Property improvements and replacements (384) (260)
Net (deposits to) receipts from restricted escrows (6) 81
Net cash used in investing activities (390) (179)
Cash flows used in financing activities:
Payments on mortgage notes payable (88) (81)
Net decrease in cash and cash equivalents (143) (191)
Cash and cash equivalents at beginning of period 251 465
Cash and cash equivalents at end of period $ 108 $ 274
Supplemental disclosure of cash flow information:
Cash paid for interest $1,577 $1,584
See Accompanying Notes to Consolidated Financial Statements
e)
DAVIDSON DIVERSIFIED REAL ESTATE III, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements of Davidson
Diversified Real Estate III, L.P. (the "Partnership") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-QSB and Item 310(b) of
Regulation S-B. 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 Davidson Diversified Properties, Inc.
("Managing General Partner"), a wholly-owned subsidiary of Insignia Properties
Trust ("IPT"), (see Note C), all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three and nine month periods ended September 30, 1998,
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1998. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Partnership's annual
report on Form 10-KSB for the year ended December 31, 1997.
Reclassifications
Certain reclassifications have been made to the 1997 balances to conform to the
1998 presentation.
Principles of Consolidation
The consolidated financial statements of the Partnership include its 99.99%
limited partnership interest in Plainview Apartments, L.P. and its wholly owned
partnership Salem GP, LLC. The Partnership may remove the General Partner of
Plainview Apartments, L.P.; therefore, the partnership is controlled and
consolidated by the Partnership. All significant interpartnership balances have
been eliminated.
NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The Partnership paid property management fees to
affiliates of the Managing General Partner based upon collected gross rental
revenues for property management services as noted below for the nine months
ended September 30, 1998 and 1997, respectively. The Partnership Agreement
provides for payments for services and as reimbursement of certain expenses
incurred by affiliates on behalf of the Partnership.
The following transactions with affiliates of the Managing General Partner were
incurred during the nine months ended September 30, 1998 and 1997:
1998 1997
(in thousands)
Property management fees (included in
operating expenses) $220 $212
Reimbursement for services of affiliates
(included in operating and general and
administrative expenses and investment
property) 120 95
Included in reimbursement for services of affiliates is approximately $20,000
and $2,000 of construction services reimbursements for the nine months ended
September 30, 1998 and 1997, respectively.
For the period from January 1, 1997, to August 31, 1997, the Partnership insured
its properties under a master policy through an agency affiliated with the
Managing General Partner with an insurer unaffiliated with the Managing General
Partner. An affiliate of the Managing General Partner acquired, in the
acquisition of a business, certain financial obligations from an insurance
agency, which was later acquired by the agent who placed the master policy. The
agent assumed the financial obligations to the affiliate of the Managing General
Partner, which receives payments on these obligations from the agent. The
amount of the Partnership's insurance premiums that accrued to the benefit of
the affiliate of the Managing General Partner by virtue of the agent's
obligations was not significant.
On August 27, 1998, an affiliate of the Managing General Partner (the
"Purchaser") commenced a tender offer for limited partnership interests in the
Partnership. The Purchaser offered to purchase up to 300 of the outstanding
units of limited partnership interest in the Partnership at $3,000 per Unit, net
to the seller in cash. The expiration date for the tender offers has been
extended to November 16, 1998.
NOTE C - TRANSFER OF CONTROL; SUBSEQUENT EVENT
On October 1, 1998, Insignia Financial Group, Inc. completed its merger with and
into Apartment Investment and Management Company ("AIMCO"), a publicly traded
real estate investment trust, with AIMCO being the surviving corporation (the
"Insignia Merger"). As a result of the Insignia Merger, AIMCO acquired control
of the Managing General Partner. In addition, AIMCO also acquired approximately
51% of the outstanding common shares of beneficial interest of IPT, the sole
shareholder of the Managing General Partner. Also, effective October 1, 1998
IPT and AIMCO entered into an Agreement and plan of Merger pursuant to which IPT
is to be merged with and into AIMCO or a subsidiary of AIMCO (the "IPT Merger").
The IPT Merger requires the approval of the holders of a majority of the
outstanding IPT Shares. AIMCO has agreed to vote all of the IPT Shares owned
by it in favor of the IPT Merger and has granted an irrevocable limited proxy
to unaffiliated representatives of IPT to vote the IPT Shares acquired by AIMCO
and its subsidiaries in favor of the IPT Merger. As a result of AIMCO's
ownership and its agreement, the vote of no other holder of IPT is required to
approve the merger. The Managing General Partner does not believe
that this transaction will have a material effect on the affairs and operations
of the Partnership.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
The Partnership's investment properties consist of two apartment complexes. The
following table sets forth the average occupancy of these properties for the
nine months ended September 30, 1998 and 1997:
Average Occupancy
1998 1997
Salem Courthouse
Indianapolis, Indiana 96% 92%
Plainview Apartments
Louisville, Kentucky 92% 92%
The Managing General Partner attributes the increase in occupancy at Salem
Courthouse Apartments to a change in the timing of lease expirations. They now
expire in summer when there is more rental traffic at the property rather than
during the winter months when traffic is historically slower.
The Partnership realized a net loss of approximately $752,000 for the nine
months ended September 30, 1998, compared to a net loss of approximately
$828,000 for the corresponding period in 1997. The Partnership realized net
losses of $275,000 and $295,000 for the three months ended September 30, 1998
and 1997, respectively. The decrease in net loss for the three and nine month
periods ended September 30, 1998, versus the same periods in 1997 is primarily
attributable to an increase in rental income and other income, partially offset
by an increases in operating expense and general and administrative expense.
Rental income increased for the nine months ended September 30, 1998, primarily
due to an increase in average occupancy at Salem Courthouse, as discussed above
as well as an increase in the average annual rental rate at both of the
properties. Other income increased primarily due to an increase in utility
income. Operating expense increased for the nine months ended September 30,
1998, due to an exterior painting project and interior repair work at Plainview
Apartments. General and administrative expense increased due to an increase in
reimbursement of certain expenses incurred by affiliates on behalf of the
Partnership.
Included in operating expense for the nine months ended September 30, 1998, is
approximately $172,000 of major repairs and maintenance comprised primarily of
exterior building repairs and painting, construction service reimbursements
related to a roof project at Plainview Apartments in 1997, and parking lot
repairs. Included in operating expense for the nine months ended September 30,
1997, is approximately $84,000 of major repairs and maintenance comprised
primarily of office equipment, exterior painting, exterior building
improvements, and parking lot repairs.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of each of its investment
properties to assess the feasibility of increasing rents, 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 rents and maintaining a high overall occupancy level.
However, due to changing market conditions which can result in the use of rental
concessions and rental reductions to offset softening market conditions, there
is no guarantee that the Managing General Partner will be able to sustain such a
plan.
The Partnership had cash and cash equivalents of approximately $108,000 at
September 30, 1998, compared to cash and cash equivalents of approximately
$274,000 at September 30, 1997. Cash and cash equivalents decreased
approximately $143,000 and $191,000 for the periods ended September 30, 1998 and
1997, respectively. The increase in net cash provided by operating activities
for the nine months ended September 30, 1998, was due to the smaller decrease in
other liabilities, as compared to the nine months ended September 30, 1997, a
decrease in other assets, an increase in tenant security deposit liabilities,
and a decrease in the net loss, as discussed previously. The decrease in other
liabilities at September 30, 1997, is due to the payment of expenses which were
accrued at December 31, 1996, related to a casualty at Plainview Apartments.
The decrease in other assets for the nine months ended September 30, 1998, as
compared to an increase for the nine months ended September 30, 1997, is
attributable to the timing of insurance payments. Net cash used in investing
activities increased due to an increase in property improvements and
replacements and a decrease in receipts from restricted escrows. Property
improvements and replacements consist primarily of replacing HVAC condensing
units at Plainview Apartments and carpet replacement at both properties. Net
cash used in financing activities results from payments on mortgage notes
payable for the nine months ended September 30, 1998.
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 various properties to adequately maintain the
physical assets and to comply with federal, state and local legal and regulatory
requirements. Such assets are currently thought to be sufficient for any near-
term needs of the Partnership. The Managing General Partner is currently
assessing the need for capital improvements at each of the Partnership's
properties. To the extent that additional capital improvements are required,
the Partnership's distributable cash flow, if any, may be adversely affected.
The mortgage indebtedness of approximately $23,766,000, net of discount,
requires balloon payments which total approximately $23,120,000 at dates ranging
from October 15, 2003, to November 15, 2010. The Managing General Partner will
attempt to refinance such indebtedness or sell the properties prior to such
maturity date. If the properties cannot be refinanced or sold for a sufficient
amount, the Partnership will risk losing such properties through foreclosure.
There were no cash distributions made for the nine months ended September 30,
1998 or 1997. Future cash distributions will depend on the levels of net cash
generated from operations, refinancings, property sales and the availability of
cash reserves. The Partnership's distribution policy will be reviewed on a
quarterly basis. There can be no assurance, however, that the Partnership will
generate sufficient funds from operations to permit distributions to its
partners in 1998 or subsequent periods.
Transfer of Control; Subsequent Event
On October 1, 1998, Insignia Financial Group, Inc. completed its merger with and
into Apartment Investment and Management Company ("AIMCO"), a publicly traded
real estate investment trust, with AIMCO being the surviving corporation (the
"Insignia Merger"). As a result of the Insignia Merger, AIMCO acquired control
of the Managing General Partner. In addition, AIMCO also acquired approximately
51% of the outstanding common shares of beneficial interest of Insignia
Properties Trust ("IPT"), the sole shareholder of the Managing General Partner.
Also, effective October 1, 1998 IPT and AIMCO entered into an Agreement and plan
of Merger pursuant to which IPT is to be merged with and into AIMCO or a
subsidiary of AIMCO (the "IPT Merger"). The IPT Merger requires the approval of
the holders of a majority of the outstanding IPT Shares.
AIMCO has agreed to vote all of the IPT Shares owned by it in favor of the IPT
Merger and has granted an irrevocable limited proxy to unaffiliated
representatives of IPT to vote the IPT Shares acquired by AIMCO and its
subsidiaries in favor of the IPT Merger. As a result of AIMCO's ownership and
its agreement, the vote of no other holder of IPT is required to approve the
merger. The Managing General Partner does not believe that this transaction
will have a material effect on the affairs and operations of the Partnership.
Year 2000
General Description of the Year 2000 Issue and the Nature and Effects of the
Year 2000 on Information Technology (IT) and Non-IT Systems
The Year 2000 Issue is the result of computer programs being written using two
digits rather than four to define the applicable year. The Partnership is
dependent upon the Managing General Partner and its affiliates for management
and administrative services ("Managing Agent"). Any computer programs or
hardware that have date-sensitive software or embedded chips may recognize a
date using "00" as the year 1900 rather than the year 2000. This could result
in a system failure or miscalculations causing disruptions of operations,
including, among other things, a temporary inability to process transactions,
send invoices, or engage in similar normal business activities.
The Managing Agent has determined that it will be required to modify or replace
significant portions of its software and certain hardware so that those systems
will properly utilize dates beyond December 31, 1999. The Managing Agent
presently believes that with modifications or replacements of existing software
and certain hardware, the Year 2000 Issue can be mitigated. However, if such
modifications and replacements are not made, or are not completed timely, the
Year 2000 Issue could have a material impact on the operations of the Managing
Agent and the Partnership.
Status of Progress in Becoming Year 2000 Compliant
The Managing Agent's plan to resolve the Year 2000 Issue involves the following
four phases: assessment, remediation, testing and implementation. To date, the
Managing Agent has fully completed its assessment of all information systems
that could be significantly affected by the Year 2000, and has begun the
remediation, testing and implementation phase on both hardware and software
systems. Assessments are continuing in regards to embedded systems in operating
equipment. The Managing Agent anticipates having all phases complete by June 1,
1999.
In addition to the areas the Partnership is relying on the Managing Agent to
verify compliance with, the Partnership has certain operating equipment,
primarily at the property sites, which needed to be evaluated for Year 2000
compliance. The focus of the Managing General Partner was to the security
systems, elevators, heating-ventilation-air-conditioning systems, telephone
systems and switches, and sprinkler systems. The Managing General Partner is
currently engaged in the identification of all non-compliant operational
systems, and is in the process of estimating the costs associated with any
potential modifications or replacements needed to such systems in order for them
to be Year 2000 compliant. It is not expected that such costs would have a
material adverse affect upon the operations of the Partnership.
Risk Associated with the Year 2000
The Managing General Partner believes that the Managing Agent has an effective
program in place to resolve the Year 2000 issue in a timely manner and has
appropriate contingency plans in place for critical applications that could
affect the Partnership's operations. To date, the Managing General Partner is
not aware of any external agent with a Year 2000 issue that would materially
impact the Partnership's results of operations, liquidity or capital resources.
However, the Managing General Partner has no means of ensuring that external
agents will be Year 2000 compliant. The Managing General Partner does not
believe that the inability of external agents to complete their Year 2000
resolution process in a timely manner will have a material impact on the
financial position or results of operations of the Partnership. However,
the effect of non-compliance by external agents is not readily determinable.
Other
Certain items discussed in this quarterly report may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995 (the "Reform Act") and as such may involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
or achievements of the Partnership to be materially different from any results,
performance or achievements expressed or implied by such forward-looking
statements. Such forward-looking statements speak only as of the date of this
quarterly report. The Partnership expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in the Partnership's
expectations with regard thereto or any change in events, conditions or
circumstances on which any such statement is based.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDING
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled ROSALIE NUANES, ET AL. V. INSIGNIA
FINANCIAL GROUP, INC., ET AL. in the Superior Court of the State of California
for the County of San Mateo. The Plaintiffs named as defendants, among others,
the Managing General Partner and several of their affiliated partnerships and
corporate entities. The complaint purports to assert claims on behalf of a
class of limited partners and derivatively on behalf of a number of limited
partnerships which are named as nominal defendants, challenging the acquisition
by Insignia Financial Group, Inc. ("Insignia") and entities which were, at the
time, affiliates of Insignia ("Insignia Affiliates") of interests in certain
general partner entities, past tender offers by Insignia Affiliates to acquire
limited partnership units, the management of partnerships by Insignia Affiliates
as well as a recently announced agreement between Insignia and Apartment
Investment and Management Company. The complaint seeks monetary damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998, the Managing General Partner filed a motion seeking dismissal of the
action. In lieu of responding to the motion, the plaintiffs have filed an
amended complaint. The Managing General Partner has filed demurrers to the
amended complaint which are scheduled to be heard on January 8, 1999. The
Managing General Partner believes the action to be without merit, and intends to
vigorously defend it.
On July 30, 1998, certain entities claiming to own limited partnership interests
in certain limited partnerships whose general partners were, at the time,
affiliates of Insignia filed a complaint entitled EVEREST PROPERTIES, LLC. V.
INSIGNIA FINANCIAL GROUP, INC., ET AL. in the Superior Court of the State of
California, county of Los Angeles. The action involves 44 real estate limited
partnership (including the Partnership) in which the plaintiffs allegedly own
interests and which Insignia Affiliates allegedly manage or control (the
"Subject Partnerships"). The complaint names as defendants Insignia, several
Insignia Affiliates alleged to be managing partners of the Subject Partnerships,
the Partnership and the Managing General Partner. Plaintiffs allege that they
have requested from, but have been denied by each of the Subject Partnerships,
lists of their respective limited partners for the purpose of making tender
offers to purchase up to 4.9% of the limited partner units of each of the
Subject Partnerships. The complaint also alleges that certain of the defendants
made tender offers to purchase limited partner units in many of the Subject
Partnerships, with the alleged result that plaintiffs have been deprived of the
benefits they would have realized from ownership of the additional units. The
plaintiffs assert eleven causes of action, including breach of contract, unfair
business practices, and violations of the partnership statutes of the states in
which the Subject Partnerships are organized. Plaintiffs seek compensatory,
punitive and treble damages. The Managing General Partner filed an answer to
the complaint on September 15, 1998. The Managing General Partner believes the
claims to be without merit and intends to defend the action vigorously.
The Partnership is unaware of any other pending or outstanding litigation that
is not of a routine nature. The Managing General Partner of the Partnership
believes that all such pending or outstanding litigation will be resolved
without a material adverse effect upon the business, financial condition, or
operations of the Partnership.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit to this
report.
(b) Reports on Form 8-K:
None filed during the quarter ended September 30, 1998.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
DAVIDSON DIVERSIFIED REAL ESTATE III
By: Davidson Diversified Properties, Inc.
Managing General Partner
By: /s/Patrick Foye
Patrick Foye
Executive Vice President
By: /s/Timothy R. Garrick
Timothy R. Garrick
Vice President - Accounting
(Duly Authorized Officer)
Date: November 12, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
Davidson Diversified Real Estate III, L.P. 1998 Third Quarter 10-QSB
and is qualified in its entirety by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000773679
<NAME> DAVIDSON DIVERSIFIED REAL ESTATE III, L.P.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 108
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 34,334
<DEPRECIATION> (16,109)
<TOTAL-ASSETS> 19,291
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 23,766
0
0
<COMMON> 0
<OTHER-SE> (5,371)
<TOTAL-LIABILITY-AND-EQUITY> 19,291
<SALES> 0
<TOTAL-REVENUES> 4,368
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5,120
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,626
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (752)
<EPS-PRIMARY> (728.62)<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
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