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Decade Companies Income Properties--A Limited Partnership
(Name of Registrant as Specified In Its Charter)
Filed by Registrant
(Name of Person(s) Filing Proxy Statement,
if Other than Registrant)
<PAGE>
Exhibit Index
Exhibit
1 Letter dated January 18, 1997
January 18, 1997
RE: Decade Companies Income Properties
Dear Investor:
In response to the proposed Amendment to the Limited Partnership
Agreement that was sent to you on January 4, 1997, we have had an
opportunity to talk with many of the limited partners. A common
theme in these conversations has been concern about the
uncertainty of the future time table to sell the properties and
liquidate the partnership.
As your General Partner, Decade Companies works very hard to make
your investment a success. Since inception, the goal has been to
distribute cash to the partners on a regular basis and to obtain
the best selling price for the properties so that the investment
objectives of the Partnership can be met. The goal has not
changed. Since inception the Partnership has consistently
distributed cash to you on a quarterly basis (except for the
third quarter of 1996 during the tender offer). Cash
distributions have resumed and you should receive your check for
the fourth quarter of 1996 in the next few days.
It is very costly to solicit offers for an operating apartment
complex. Our experience two years ago with Town Place Apartments
is a good example. We solicited offers to sell Town Place and
received 23 offers on the property between January and October
1994. The lowest offer was $7,450,000. The average offer was
$8,970,000. The highest offer was $9,500,000. We accepted the
highest offer. When the proposed sale fell through in 1994, the
buyer forfeited $100,000 in earnest money to the Partnership.
However, occupancy at the property declined from 98% to 89%
during the period that it was under contract for sale. We
attribute this primarily to staff turnover caused by the
uncertainty of employment associated with a new owner. In our
experience, this is not unusual.
It would be easy for us to sell the Partnership's properties in
today's market at some price. However, the goal is not to sell
the real estate but to sell it at a price that will make your
investment in this partnership a success. While we believe the
Partnership will be best served by waiting to liquidate the
Partnership's properties until a capital gains tax is enacted and
until the emerging increase in rental rates mature, our position
is that the properties are always for sale and that any
reasonable offer will be seriously considered. This is not a
change in policy. The General Partner consistently tests the
market to determine if a buyer can be found at a price that will
be sufficient to meet the investment goals of the partnership.
As a result of suggestions received from limited partners,
however, we will increase our efforts in the next several months
to attract a reasonable offer for any or all of the properties
and shall report on the results of those efforts.
Do not lose sight of the fact that the partnership has survived
through the worst real estate crisis since the depression while
consistently distributing cash to the partners. We believe that
positive trends in the real estate market are now emerging and
property values are increasing, although there can be no
assurance as to any particular increase.
Favorable changes in tax laws or renewed inflationary
expectations would make the Partnership's properties more
valuable. As you know, Congress has given serious consideration
to reducing the capital gains tax rate. The General Partner
believes that the partnership's properties are perfectly poised
to take advantage of any run-up in real estate values.
Nevertheless, we will solicit offers on the properties and report
back to you.
If you have not already voted on the proposed Amendment to the
Limited Partnership Agreement, we encourage you to do so. The
proposed Amendment is designed to give partners a right that they
do not presently have and we recommend that you vote for it.
Please sign and return your consent if you have not already done
so. If you have any questions, please contact me directly at
(414) 792-9200.
Very truly yours,
Michael Sweet
Partnership Manager
