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<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<EXCHANGE-RATE> 1
<CASH> 1,463,539
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,493,060
<PP&E> 30,771,255
<DEPRECIATION> 4,557,573
<TOTAL-ASSETS> 27,798,863
<CURRENT-LIABILITIES> 1,120,987
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0
0
<OTHER-SE> 4,027,323
<TOTAL-LIABILITY-AND-EQUITY> 27,798,863
<SALES> 1,414,521
<TOTAL-REVENUES> 1,435,555
<CGS> 0
<TOTAL-COSTS> 1,131,773
<OTHER-EXPENSES> 72,233
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 373,061
<INCOME-PRETAX> (141,512)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
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<NET-INCOME> (141,512)
<EPS-PRIMARY> (8.02)
<EPS-DILUTED> (8.02)
</TABLE>
UNITED STATES
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 quarterly period ended March 31, 1995
OR
[ ] 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 33-00086
Decade Companies Income Properties - A Limited Partnership
(Exact name of registrant as specified in its charter)
State of Wisconsin 39-1518732
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
250 Patrick Blvd., Suite 140 Brookfield, Wisconsin 53045-5864
(Address of principal executive offices) (Zip Code)
Registrants telephone number, including area code: 414-792-9200
Former name, former address and former fiscal year, if changed
since last report: Not Applicable.
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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
YES NO
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each issuer's classes
of common stock, as of the latest practicable date.
Decade Companies Income Properties - A Limited Partnership
INDEX
March 31, 1995
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements (unaudited as to
March 31, 1995 and the three months
then ended).
Balance Sheets at March 31, 1995, and
December 31, 1994. 3
Statements of Operations for the three months
ended March 31, 1995 and 1994. 4
Statements of Changes in Partners' Capital
for the three months ended March 31, 1995
and the year ended December 31, 1994. 5
Statements of Cash Flows for the three months
ended March 31, 1995 and 1994. 6
Notes to Financial Statements. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7 - 11
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K. 11
SIGNATURES 12
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
BALANCE SHEETS
March 31 December 31
1995 1994
(unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 31,640 $ 16,415
Restricted cash 1,135,736 1,117,531
Escrow deposits 296,163 178,881
Prepaid expenses and other assets 29,521 37,805
Total Current Assets 1,493,060 1,350,632
INVESTMENT PROPERTIES, AT COST: 30,771,255 30,749,902
Less: accumulated depreciation (4,557,573) (4,282,571)
Net Investment Property 26,213,682 26,467,331
OTHER ASSETS:
Utility deposits 43,415 43,415
Debt issue costs, net of accumulated
amortization 48,706 52,797
Total Other Assets 92,121 96,212
Total Assets $27,798,863 $27,914,175
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES:
Line of credit mortgage note
payable $ 220,000 $ 100,000
Accounts payable and
accrued taxes 481,296 314,388
Tenant security deposits 158,734 166,677
Distributions payable 221,264 220,264
Accrued interest payable 39,693 37,872
Payables to affiliates 3,371,809 3,386,016
Mortgage notes payable 19,278,744 19,300,793
Total Liabilities 23,771,540 23,526,010
PARTNERS' CAPITAL:
General Partner Capital (63,036) (60,621)
Limited Partners
(authorized--18,000 Interests;
outstanding--17,466.31 Interests 4,090,359 4,448,786
Total Partners' Capital 4,027,323 4,388,165
Total Liabilities and
Partners' Capital $27,798,863 $27,914,175
Note: The balance sheet at December 31, 1994 has been derived from the
audited financial statements at that date.
See Notes to Financial Statements.
STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended March 31
1995 1994
Operating revenue:
Rental income $1,414,521 $1,723,962
Operating expenses:
Operating 669,221 774,066
Real Estate Taxes 187,552 213,735
Total 856,773 987,801
Net income before
debt service and other
expenses 557,748 736,161
Interest expense (368,970) (452,430)
Depreciation (275,000) (335,376)
Amortization of debt issue costs (4,091) (4,076)
Net (loss) from investment property (90,313) (55,721)
Other income (expenses):
Interest income 21,034 41,867
Partnership management (72,233) (77,415)
(51,199) (35,548)
NET (LOSS) $ (141,512) $ (91,269)
Net (loss) attributable to
General Partner (1%) $ (1,415) $ (913)
Net (loss) attributable to
Limited Partners (99%) (140,097) (90,356)
$ (141,512) $ (91,269)
Net (loss) per Limited
Partner Interest $ (8.02) $ (5.17)
See Notes to Financial Statements <PAGE>
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
(Unaudited as to the Three Months Ended March 31, 1995)
Limited General Limited
Partnership Partner Partners'
Interests Capital Capital Total
BALANCES AT 12/31/93 17,466.31 $(41,343) $ 6,623,372 $ 6,582,029
Distributions to Partners (6,134) (873,321) (879,455)
Net (loss) for the year (13,144) (1,301,265) (1,314,409)
BALANCES AT 12/31/94 17,466.31 $(60,621) $ 4,448,786 $ 4,388,165
Distributions to Partners (1,000) (218,330) (219,330)
Net (loss) for the period (1,415) (140,097) (141,512)
BALANCES AT 3/31/95 17,466.31 $(63,036) $ 4,090,359 $ 4,027,323
() denotes deficit or deduction.
See Notes to Financial Statements. <PAGE>
STATEMENTS OF CASH FLOWS - (UNAUDITED)
For The Three Months Ended March 31,
1995 1994
CASH PROVIDED FROM OPERATIONS $ 156,957 $ 226,426
INVESTING ACTIVITIES:
Additions to investment property (21,353) (39,996)
FINANCING ACTIVITIES:
Principal payments on mortgage notes (22,049) (45,809)
Draw on line of credit note 120,000 100,000
Distributions paid to limited partners (218,330) (218,330)
NET CASH (USED IN) FINANCING ACTIVITIES (120,379) (164,139)
INCREASE (DECREASE) IN CASH & CASH
EQUIVALENTS 15,225 22,291
CASH & CASH EQUIVALENTS AT THE BEGINNING
OF PERIOD 16,415 212,257
CASH & CASH EQUIVALENTS
AT THE END OF PERIOD $ 31,640 $ 234,548
Supplementary disclosure of cash flow information:
Interest paid $ 181,556 $ 490,015
Income taxes paid 0 0
See Notes to Financial Statements
Note A--Basis of Presentation
The accompanying unaudited 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 management, 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, 1995 are not necessarily indicative of the results
that may be expected for the year ended December 31, 1995. 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, 1994.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
Results of Operations
Operating revenue from rental income was $1,414,521 in the quarter
ended March 31, 1995, compared to $1,723,962 for the same period of
1994.
The comparative presentation of operations reflects the operation
of a different number of apartment units during the respective
periods. The prior year period includes a full three months
operations for Ashley Pointe Apartments which was exchanged in
April 1994 and therefore is not included in the current period
operations. The three other properties were owned and operated in
both periods. For comperative purposes, the following table
presents the operating figures to give recognition to this change
in units:
Three Months Ended March 31
1995 1994
Three Three Ashley
Properties Properties Pointe Total
Rental Income $1,415,000 $1,471,000 $ 253,000 $1,724,000
Operating Expense:
Operating 669,000 619,000 155,000 774,000
Real estate taxes 188,000 195,400 18,600 214,000
Interest 369,000 412,000 40,000 452,000
Depreciation 275,000 280,400 54,600 335,000
Amortization 4,000 4,000 0 4,000
Total 1,505,000 1,510,800 268,200 1,779,000
(Loss) from
investments
properties $ (90,000) $ (39,800) $ (15,200) $ (55,000)
Operating revenue from rental operations decreased 17.9% (down
$309,000) from the comparative quarter. This decrease is primarily
attributable to the sale of Ashley Pointe Apartments which had
revenue of $253,000 in the prior year period. Rental income
decreased at Town Place 6.8% (down $28,000). Revenue from The
Meadows II decreased significantly by $78,000 (16%) primarily due
to a drop in occupancy, which was caused by competition in the area
from new residential construction offering rental incentives.
Revenues from Pelican Sound increased $50,000 (8.8%). In the first
quarter of 1995, Pelican Sound generated $615,000 (43.5%) of the
operating revenue, The Meadows II generated $413,000 (29.2%), and
Town Place generated $387,000 (27.3%).
The average monthly gross potential rent per unit at the Apartments
for the first quarter of 1995, and the comparative period in 1994
is set forth below:
Number
of Units 1995 1994
Pelican Sound 379 $551 $532
The Meadows II 316 $568 $556
Town Place 240 $554 $545
Ashley Pointe 200 N/A $485
All Rental Units $558 $533
"Gross potential rent" represents the asking rent established by
the Partnership for a vacant apartment plus the rent in effect for
occupied apartments.
The average occupancy level at the Apartments for the quarter ended
March 31, 1995, and the comparable period in 1994, is set forth
below:
Three Months Ended
3/31/95 3/31/94
Pelican Sound 96.3% 92.7%
The Meadows II 76.5% 92.7%
Town Place 96.5% 97.3%
Ashley Pointe N/A 87.3%
All Rental Units 89.5% 92.8%
The range of occupancy levels at the Apartments for the three month
period ended March 31, 1995, and the comparable period in 1994, is
set forth below:
Three Months Ended
3/31/95 3/31/94
Pelican Sound 95.7-96.9% 91.1-94.3%
The Meadows II 74.5-80.0% 91.0-94.1%
Town Place 95.5-97.0% 96.7-97.9%
Ashley Pointe N/A 86.9-87.8%
All Rental Units 89.2-91.1% 92.6-93.0%
Total rental expenses before depreciation and debt service in the
three month period ended March 31, 1995 decreased by $131,000, from
$988,000 to $857,000, compared to the same period of 1994. The
decrease was comprised of decreases from Ashley Pointe ($174,000)
and The Meadows II ($13,000), offset by increases from Pelican
Sound ($36,000) and Town Place ($20,000).
Net income from rental property operations before debt service and
depreciation was approximately $558,000 for the first three months
of 1995, compared to $736,000 for the comparative period, a
decrease of approximately $178,000. The decrease was comprised of
decreases from Ashley Pointe ($80,000), The Meadows II ($64,000),
and Town Place ($48,000), offset by an increase at Pelican Sound of
$14,000.
As a result of the foregoing, net operating income before
depreciation and debt service was $558,000 for the quarter compared
to $736,000 for the comparative quarter. For the quarter, Pelican
Sound contributed $241,000 (43.2%) of net operating income before
depreciation and debt service; The Meadows contributed $153,000
(27.5%); and Town Place contributed $164,000 (29.3%).
Interest expense decreased $83,000 from the comparative period in
1994, from $452,000 to $369,000.
The net income before debt service from real estate activities is
partially sheltered by deductions for depreciation which do not
affect cash flow. Depreciation decreased $60,000 from 1995 to 1994
for the respective three month periods, and included $54,600 for
Ashley Pointe not in the current year.
The Partnership's net other expenses increased in 1995 by
approximately $16,000. Interest income decreased $21,000, offset
by a decrease in partnership management expenses of $5,000. The
decrease in interest earned is primarily attributable to a smaller
investment portfolio, which in 1994 included the $4 million of bank
certificates of deposit pledged against the Town Place mortgage
loan of $4 million.
As a result of the foregoing, the Partnership's net loss for the
quarter ended March 31, 1995 was $142,000, compared to a loss of
$91,000 in the same period of 1994. Exclusive of depreciation and
amortization, the Partnership's net income for the quarters ended
March 31, 1995 and 1994 was $137,000 and $248,000, respectively of
which $39,000 could be attributed to Ashley Point for the prior
year.
The Partnership intends to acquire additional apartment complexes
and may trade one or more of the Apartments if such transaction
would improve net operating income.
Liquidity and Financial Condition
At March 31, 1995 there was $327,000 of cash and cash equivalents
and escrow deposits available to pay liabilities compared to
$195,000 available at December 31, 1994.
During the first three months of 1995, cash and cash equivalents
increased by $15,000. During the period $157,000 was generated by
operating activities, while approximately $21,000 was used in
investing activities, and approximately $120,000 was used in
financing activities as shown herein on the Statements of Cash
Flows.
Operations provided cash flow which was used to partially fund the
cash distributions paid to the Limited Partners of $218,000. The
Partnership borrowed $120,000 on its line of credit to fund the
balance of the cash distributions, to make the principal reductions
of $22,000 and to make capitalized improvements to investment
properties of $21,000. Day-to-day operating expenses are presently
being funded from operations and do not require the use of cash
reserves.
The Agreement of Limited Partnership provides that the Partnership
will make distributions for each calendar quarter of Cash Flow less
amounts set aside for Reserves. In January the Partnership paid to
the Limited Partners the December declaration of $218,330 ($12.50
per Interest) and declared a similar amount payable for the first
quarter of 1995 to be paid in April 1995. The distribution payable
to the General Partner of $1,000 was accrued and payment will be
made subsequently. The Partnership intends, but is not required,
to continue to make cash distributions to the Limited Partners each
quarter in the same amount.
During the first three months of 1995 total liabilities increased
by $246,000. The increase in liabilities is attributable to an
increase in accounts payable and accrued taxes of $167,000, an
increase in the bank line-of-credit note of $120,000, an increase
in accrued interest of $1,800, and an increase in distributions
payable of $1,000, offset by decreases of $7,900 of tenant security
deposits, a decrease in mortgage notes payable of $22,000, and a
decrease in payables to affiliates of $14,000.
The outstanding principal balance on mortgage notes was reduced by
$22,049 during the quarter. Scheduled mortgage debt principal
reductions are approximately $2,572,000 over the balance of the
year, including the balloon payment of $2.5 million on the Town
Place mortgage note due December 1995. The $10 million note on
Pelican Sound requires payments of interest only until January 1,
1996, at which time payments of principal will also be required.
The Partnership intends to satisfy the $2.5 mortgage loan on Town
Place prior to the December due date by refinancing the debt.
Partners' Capital decreased by $360,000 during the first three
months of 1995 due to the net loss for financial reporting purposes
of approximately $141,000 and cash distributions declared payable
to the partners of $219,000.
Restricted funds of $1,135,736 are held in escrow by the qualified
intermediary of the Ashley Pointe exchange. The funds are to be
used to acquire a replacement property and complete the like-kind
exchange. However, they may also be used to provide additional
liquidity, if neccesary, until a replacement property is acquired.
PART II.
OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
The Company did not filed a report on Form 8-K during the three
months ended March 31, 1995.
<PAGE>
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.
DECADE COMPANIES INCOME PROPERTIES -
A LIMITED PARTNERSHIP
(Registrant)
By: DECADE COMPANIES
(General Partner)
Date: May 12, 1995 By:/s/ Jeffrey Keierleber
Jeffrey Keierleber
General Partner and Principal
Financial and Accounting Officer
of Registrant
