UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
------------------------------------------
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 0-15446
---------
MCNEIL REAL ESTATE FUND XXV, L.P.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 33-0120335
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (972) 448-5800
-----------------------------
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 and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- ------- --------------------
MCNEIL REAL ESTATE FUND XXV, L.P.
BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
------------ ------------
ASSETS
- ------
Real estate investments:
<S> <C> <C>
Land ...................................................... $ 4,205,425 $ 4,205,425
Buildings and improvements ................................ 48,431,810 48,374,279
------------ ------------
52,637,235 52,579,704
Less: Accumulated depreciation and amortization .......... (29,888,625) (29,325,158)
------------ ------------
22,748,610 23,254,546
Asset held for sale .......................................... 9,053,022 9,016,824
Cash and cash equivalents .................................... 3,443,780 3,654,369
Cash segregated for security deposits ........................ 391,982 389,318
Accounts receivable, net of allowance for doubtful
accounts of $ 530,164 at March 31, 1999 and
December 31, 1998 ......................................... 567,767 506,774
Escrow deposits .............................................. 132,278 93,305
Deferred borrowing costs, net of accumulated
amortization of $97,302 and $95,019 at March 31,
1999 and December 31, 1998, respectively .................. 221,448 223,731
Prepaid expenses and other assets ............................ 307,135 309,634
------------ ------------
$ 36,866,022 $ 37,448,501
============ ============
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
- ------------------------------------------
Mortgage note payable ........................................ $ 7,077,678 $ 7,094,110
Accounts payable and accrued expenses ........................ 81,194 88,673
Accrued interest ............................................. 60,455 60,596
Accrued property taxes ....................................... 511,978 566,683
Payable to affiliates ........................................ 1,262,751 1,091,046
Land lease obligation ........................................ 137,091 152,791
Security deposits and deferred rental revenue ................ 425,664 439,632
------------ ------------
9,556,811 9,493,531
------------ ------------
Partners' equity (deficit):
Limited partners - 84,000,000 limited partnership
units authorized; 82,943,685 limited partnership
units issued and outstanding at March 31, 1999
and December 31, 1998 ................................... 27,787,877 28,437,132
General Partner ........................................... (478,666) (482,162)
------------ ------------
27,309,211 27,954,970
------------ ------------
$ 36,866,022 $ 37,448,501
============ ============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XXV, L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------
1999 1998
---------- ----------
Revenue:
<S> <C> <C>
Rental revenue .......................................... $2,496,818 $2,396,359
Interest ................................................ 50,605 47,549
---------- ----------
Total revenue ......................................... 2,547,423 2,443,908
---------- ----------
Expenses:
Interest ................................................ 193,927 199,860
Depreciation and amortization ........................... 563,467 599,586
Property taxes .......................................... 217,464 220,401
Personnel costs ......................................... 201,945 215,468
Utilities ............................................... 181,264 186,540
Repairs and maintenance ................................. 235,212 241,547
Property management fees - affiliates ................... 139,251 138,617
Other property operating expenses ....................... 166,701 181,387
General and administrative .............................. 61,221 99,094
General and administrative - affiliates ................. 237,406 217,872
---------- ----------
Total expenses ........................................ 2,197,858 2,300,372
---------- ----------
Net income ................................................. $ 349,565 $ 143,536
========== ==========
Net income allocable to limited partners ................... $ 346,069 $ 142,101
Net income allocable to General Partner .................... 3,496 1,435
---------- ----------
Net income ................................................. $ 349,565 $ 143,536
========== ==========
Net income per thousand limited partnership units .......... $ 4.17 $ 1.71
========== ==========
Distributions per thousand limited partnership units........ $ 12.00 $ 27.13
========== ==========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XXV, L.P.
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
(Unaudited)
For the Three Months Ended March 31, 1999 and 1998
<TABLE>
<CAPTION>
Total
General Limited Partners'
Partner Partners Equity (Deficit)
------------- ------------ ----------------
<S> <C> <C> <C>
Balance at December 31, 1997 ............ $ (491,296) $ 30,280,535 $ 29,789,239
Net income .............................. 1,435 142,101 143,536
Distributions to limited partners........ -- (2,249,990) (2,249,990)
------------ ------------ ------------
Balance at March 31, 1998 ............... $ (489,861) $ 28,172,646 $ 27,682,785
============ ============ ============
Balance at December 31, 1998 ............ $ (482,162) $ 28,437,132 $ 27,954,970
Net income .............................. 3,496 346,069 349,565
Distributions to limited partners ....... -- (995,324) (995,324)
------------ ------------ ------------
Balance at March 31, 1999 ............... $ (478,666) $ 27,787,877 $ 27,309,211
============ ============ ============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XXV, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>
Three Months Ended
March 31,
--------------------------------
1999 1998
------------ ------------
Cash flows from operating activities:
<S> <C> <C>
Cash received from tenants ..................... $ 2,416,594 $ 2,378,107
Cash paid to suppliers ......................... (848,724) (921,464)
Cash paid to affiliates ........................ (204,952) (144,518)
Interest received .............................. 50,605 47,549
Interest paid .................................. (191,785) (197,703)
Property taxes paid and escrowed ............... (311,142) (334,957)
----------- -----------
Net cash provided by operating activities ......... 910,596 827,014
----------- -----------
Cash flows from investing activities:
Additions to real estate investments and
asset held for sale .......................... (93,729) (62,109)
----------- -----------
Cash flows from financing activities:
Principal payments on mortgage note
payable ...................................... (16,432) (14,795)
Payments on capitalized land lease
obligation ................................... (15,700) (11,419)
Distributions to limited partners .............. (995,324) (2,249,990)
----------- -----------
Net cash used in financing activities ............. (1,027,456) (2,276,204)
----------- -----------
Net decrease in cash and cash equivalents ......... (210,589) (1,511,299)
Cash and cash equivalents at beginning of
period ......................................... 3,654,369 3,044,669
----------- -----------
Cash and cash equivalents at end of period ........ $ 3,443,780 $ 1,533,370
=========== ===========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial
statements.
<PAGE>
McNEIL REAL ESTATE FUND XXV, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
Reconciliation of Net Income to Net Cash
Provided by Operating Activities
<TABLE>
<CAPTION>
Three Months Ended
March 31,
---------------------------
1999 1998
--------- ---------
<S> <C> <C>
Net income ............................................ $ 349,565 $ 143,536
--------- ---------
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization ...................... 563,467 599,586
Amortization of deferred borrowing costs ........... 2,283 2,283
Deferred gain ...................................... -- 29,006
Changes in assets and liabilities:
Cash segregated for security deposits ............ (2,664) (1,658)
Accounts receivable, net ......................... (60,993) (45,083)
Escrow deposits .................................. (38,973) 15,552
Prepaid expenses and other assets ................ 2,499 18,131
Accounts payable and accrued expenses ............ (7,479) (10,602)
Accrued interest ................................. (141) (126)
Accrued property taxes ........................... (54,705) (130,108)
Payable to affiliates ............................ 171,705 211,971
Security deposits and deferred rental
revenue ........................................ (13,968) (5,474)
--------- ---------
Total adjustments .............................. 561,031 683,478
--------- ---------
Net cash provided by operating activities ............. $ 910,596 $ 827,014
========= =========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL REAL ESTATE FUND XXV, L.P.
Notes to Financial Statements
March 31, 1999
(Unaudited)
NOTE 1.
- -------
McNeil Real Estate Fund XXV, L.P. (the "Partnership"), formerly known as
Southmark Equity Partners II, Ltd., was organized on February 15, 1985 as a
limited partnership under the provisions of the California Revised Limited
Partnership Act to acquire and operate commercial and residential properties.
The general partner of the Partnership is McNeil Partners, L.P. (the "General
Partner"), a Delaware limited partnership, an affiliate of Robert A. McNeil
("McNeil"). The principal place of business for the Partnership and the General
Partner is 13760 Noel Road, Suite 600, LB70, Dallas, Texas, 75240.
In the opinion of management, the financial statements reflect all adjustments
necessary for a fair presentation of the Partnership's financial position and
results of operations. All adjustments were of a normal recurring nature.
However, the results of operations for the three months ended March 31, 1999 are
not necessarily indicative of the results to be expected for the year ending
December 31, 1999.
NOTE 2.
- -------
The financial statements should be read in conjunction with the financial
statements contained in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 1998, and the notes thereto, as filed with the
Securities and Exchange Commission, which is available upon request by writing
to McNeil Real Estate Fund XXV, L.P., c/o McNeil Real Estate Management, Inc.,
Investor Services, 13760 Noel Road, Suite 600, LB70, Dallas, Texas 75240.
NOTE 3.
- -------
The Partnership pays property management fees equal to 5% of the gross rental
receipts for its residential property and 6% of gross rental receipts for its
commercial properties to McNeil Real Estate Management, Inc. ("McREMI"), an
affiliate of the General Partner, for providing property management services for
the Partnership's residential and commercial properties and leasing services for
its residential properties. McREMI may also choose to provide leasing services
for the Partnership's commercial properties, in which case McREMI will receive
property management fees from such commercial properties equal to 3% of the
property's gross rental receipts plus leasing commissions based on the
prevailing market rate for such services where the property is located.
The Partnership reimburses McREMI for its costs, including overhead, of
administering the Partnership's affairs.
<PAGE>
The Partnership is paying an asset management fee which is payable to the
General Partner. Through 1999, the asset management fee is calculated as 1% of
the Partnership's tangible asset value. Tangible asset value is determined by
using the greater of (i) an amount calculated by applying a capitalization rate
of 9% to the annualized net operating income of each property or (ii) a value of
$10,000 per apartment unit for residential property and $50 per gross square
foot for commercial properties to arrive at the property tangible asset value.
The property tangible asset value is then added to the book value of all other
assets excluding intangible items. The fee percentage decreases to .75% in 2000,
.50% in 2001 and .25% thereafter. Total accrued but unpaid asset management fees
of $1,012,465 and $876,844 were outstanding at March 31, 1999 and December 31,
1998, respectively.
Compensation and reimbursements paid to or accrued for the benefit of the
General Partner or its affiliates are as follows:
Three Months Ended
March 31,
-------------------------
1999 1998
---------- ----------
Property management fees..................... $ 139,251 $ 138,617
Charged to general and administrative
expense:
Partnership administration................ 49,724 43,317
Asset management fee...................... 187,682 174,555
--------- ---------
$ 376,657 $ 356,489
========= =========
Payable to affiliates at March 31, 1999 and December 31, 1998 consisted
primarily of unpaid property management fees, Partnership general and
administrative expenses and asset management fees and is due and payable from
current operations.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------- ---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
FINANCIAL CONDITION
- -------------------
There has been no significant change in the operations of the Partnership's
properties since December 31, 1998. The Partnership reported net income of
$349,565 for the first three months of 1999 as compared to $143,536 for the
first three months of 1998. Revenue in the first quarter of 1999 increased to
$2,547,423 from $2,443,908 in the first quarter of 1998, and expenses for the
first quarter of 1999 decreased to $2,197,858 from $2,300,372 for the same
period in 1998.
Net cash provided by operating activities was $910,596 for the three months
ended March 31, 1999. The Partnership expended $93,729 for capital improvements,
$16,432 for principal payments on its mortgage note payable and $15,700 for
payments on the capitalized land lease obligation. After distributions of
$995,324 to the limited partners, cash and cash equivalents totaled $3,443,780
at March 31, 1999, a net decrease of $210,589 from the balance at December 31,
1998.
<PAGE>
RESULTS OF OPERATIONS
- ---------------------
Revenue:
Total Partnership revenue increased by $103,515 for the three months ended March
31, 1999 as compared to the same period in 1998, mainly due to an increase in
rental revenue, as discussed below.
Rental revenue for the three months ended March 31, 1999 increased by $100,459
in relation to the comparable period in 1998. Rental revenue increased at all of
the Partnership's properties in 1999. The largest increases, of approximately
$51,000, $18,000 and $15,000, occurred at the Kellogg Building, Harbour Club I
Apartments and Century Park Office Building, respectively, mainly due to an
increase in rental rates charged to tenants.
Expenses:
Total expenses decreased by $102,514 for the quarter ended March 31, 1999 as
compared to the same period in 1998.
General and administrative expenses in the first quarter of 1999 decreased by
$37,873, as compared to the same period in 1998. The decrease was mainly due to
a greater amount of costs incurred in 1998 to explore alternatives to maximize
the value of the Partnership (see Liquidity and Capital Resources).
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Cash flow provided by operating activities totaled $910,596 for the first three
months of 1999 as compared to $827,014 provided during the same period in 1998.
The increase in cash from operations was partially due to an increase in cash
received from tenants and a decrease in cash paid to suppliers (see above
discussion of increase in rental revenue and decrease in general and
administrative expenses). These increases in cash provided by operating
activities during the first three months of 1999 were partially offset by an
increase in cash paid to affiliates during the first three months of 1999.
The Partnership expended $93,729 and $62,109 for additions to its real estate
investments during the three months ended March 31, 1999 and 1998, respectively.
A greater amount was spent in the first quarter of 1999 for tenant improvements
at Northwest Plaza and for exterior painting at Fidelity Plaza.
The Partnership distributed $995,324 and $2,249,990 to the limited partners in
the first three months of 1999 and 1998, respectively.
Short-term liquidity:
At March 31, 1999, the Partnership held cash and cash equivalents of $3,443,780.
This balance provides a reasonable level of working capital for the
Partnership's immediate needs in operating its properties.
For the Partnership as a whole, management projects positive cash flow from
operations for the remainder of 1999. Only one property, Harbour Club I
Apartments, is encumbered with mortgage debt and another property, Fidelity
Plaza, is encumbered with lease obligations. Capital improvements for all
properties in 1999 are expected to be funded from available cash reserves or
from operations of the properties.
<PAGE>
Additional efforts to maintain and improve Partnership liquidity have included
continued attention to property management activities. The objective has been to
obtain maximum occupancy rates while holding expenses to levels necessary to
maximize cash flows. The Partnership has made capital expenditures on its
properties where improvements were expected to increase the competitiveness and
marketability of the properties.
Long-term liquidity:
While the outlook for maintenance of adequate levels of liquidity is favorable,
should operations deteriorate and present cash resources be insufficient for
current needs, the Partnership would require other sources of working capital.
No such sources have been identified. The Partnership has no established lines
of credit from outside sources. Other possible actions to resolve cash
deficiencies include refinancings, deferral of capital expenditures on
Partnership properties except where improvements are expected to increase the
competitiveness and marketability of the properties, arranging financing from
affiliates or the ultimate sale of the properties.
As previously announced, the Partnership has retained PaineWebber, Incorporated
as its exclusive financial advisor to explore alternatives to maximize the value
of the Partnership, including, without limitation, a transaction in which
limited partnership interests in the Partnership are converted into cash. During
the last full week of March, the Partnership entered into a 45 day exclusivity
agreement with a well-financed bidder with whom it had commenced discussions
with respect to a sale transaction. The Partnership and such party have made
significant progress in negotiating the terms of a proposed transaction and are
continuing to have intensive discussions with respect to a transaction. In light
on these continuing negotiations, the exclusivity agreement has been extended
for an additional 21 days until June 4, 1999. It is possible that the General
Partner and its affiliates will receive non-cash consideration for their
ownership interests in connection with any such transaction. There can be no
assurance regarding whether any such agreement will be reached nor the terms
thereof.
The Partnership placed Northwest Plaza on the market for sale effective August
1, 1997.
Forward-Looking Information:
Within this document, certain statements are made as to the expected occupancy
trends, financial condition, results of operations, and cash flows of the
Partnership for periods after March 31, 1999. All of these statements are
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. These statements are not
historical and involve risks and uncertainties. The Partnership's actual
occupancy trends, financial condition, results of operations, and cash flows for
future periods may differ materially due to several factors. These factors
include, but are not limited to, the Partnership's ability to control costs,
make necessary capital improvements, negotiate sales or refinancings of its
properties, and respond to changing economic and competitive factors.
<PAGE>
YEAR 2000 DISCLOSURE
- --------------------
State of readiness
- ------------------
The year 2000 problem is the result of computer programs being written using two
digits rather than four to define the applicable year. Any programs that have
time-sensitive software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in major systems failure or
miscalculations.
Management has assessed its information technology ("IT") infrastructure to
identify any systems that could be affected by the year 2000 problem. The IT
used by the Partnership for financial reporting and significant accounting
functions was made year 2000 compliant during recent systems conversions. The
software utilized for these functions is licensed by third party vendors who
have warranted that their systems are year 2000 compliant.
Management is in the process of evaluating the mechanical and embedded
technological systems at the various properties. Management has inventoried all
such systems and queried suppliers, vendors and manufacturers to determine year
2000 compliance. Based on this review, management believes these systems are
substantially compliant. In circumstances of non-compliance management will work
with the vendor to remedy the problem or seek alternative suppliers who will be
in compliance. Management believes that the remediation of any outstanding year
2000 conversion issues will not have a material or adverse effect on the
Partnership's operations. However, no estimates can be made as to the potential
adverse impact resulting from the failure of third party service providers and
vendors to be year 2000 compliant.
Cost
- ----
The cost of IT and embedded technology systems testing and upgrades is not
expected to be material to the Partnership. Because all the IT systems have been
upgraded over the last three years, all such systems were compliant, or made
compliant at no additional cost by third party vendors. Management anticipates
the costs of assessing, testing, and if necessary replacing embedded technology
components will be less than $50,000. Such costs will be funded from operations
of the Partnership.
Risks
- -----
Ultimately, the potential impact of the year 2000 issue will depend not only on
the corrective measures the Partnership undertakes, but also on the way in which
the year 2000 issue is addressed by government agencies and entities that
provide services or supplies to the Partnership. Management has not determined
the most likely worst case scenario to the Partnership. As management studies
the findings of its property systems assessment and testing, management will
develop a better understanding of what would be the worst case scenario.
Management believes that progress on all areas is proceeding and that the
Partnership will experience no adverse effect as a result of the year 2000
issue. However, there is no assurance that this will be the case.
<PAGE>
Contingency plans
- -----------------
Management is developing contingency plans to address potential year 2000
non-compliance of IT and embedded technology systems. Management believes that
failure of any IT system could have an adverse impact on operations. However,
management believes that alternative systems are available that could be
utilized to minimize such impact. Management believes that any failure in the
embedded technology systems could have an adverse impact on that property's
performance. Management will assess these risks and develop plans to mitigate
possible failures by July 1999.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
- ------- -----------------
James F. Schofield, Gerald C. Gillett, Donna S. Gillett, Jeffrey Homburger,
Elizabeth Jung, Robert Lewis, and Warren Heller et al. v. McNeil Partners L.P.,
McNeil Investors, Inc., McNeil Real Estate Management, Inc., Robert A. McNeil,
Carole J. McNeil, McNeil Pacific Investors Fund 1972, Ltd., McNeil Real Estate
Fund IX, Ltd., McNeil Real Estate Fund X, Ltd., McNeil Real Estate Fund XI,
Ltd., McNeil Real Estate Fund XII, Ltd., McNeil Real Estate Fund XIV, Ltd.,
McNeil Real Estate Fund XV, Ltd., McNeil Real Estate Fund XX, L.P., McNeil Real
Estate Fund XXI, L.P., McNeil Real Estate Fund XXII, L.P., McNeil Real Estate
Fund XXIII, L.P., McNeil Real Estate Fund XXIV, L.P., McNeil Real Estate Fund
XXV, L.P., McNeil Real Estate Fund XXVI, L.P., and McNeil Real Estate Fund
XXVII, L.P., Hearth Hollow Associates, McNeil Midwest Properties I, L.P. and
Regency North Associates, L.P., - Superior Court of the State of California for
the County of Los Angeles, Case No. BC133799 (Class and Derivative Action
Complaint).
The action involves purported class and derivative actions brought by limited
partners of each of the limited partnerships that were named as nominal
defendants as listed above (the "Partnerships"). Plaintiffs allege that McNeil
Investors, Inc., its affiliate McNeil Real Estate Management, Inc. and three of
their senior officers and/or directors (collectively, the "Defendants") breached
their fiduciary duties and certain obligations under the respective Amended
Partnership Agreement. Plaintiffs allege that Defendants have rendered such
Units highly illiquid and artificially depressed the prices that are available
for Units on the resale market. Plaintiffs also allege that Defendants engaged
in a course of conduct to prevent the acquisition of Units by an affiliate of
Carl Icahn by disseminating purportedly false, misleading and inadequate
information. Plaintiffs further allege that Defendants acted to advance their
own personal interests at the expense of the Partnerships' public unit holders
by failing to sell Partnership properties and failing to make distributions to
unitholders.
On December 16, 1996, the Plaintiffs filed a consolidated and amended complaint.
Plaintiffs are suing for breach of fiduciary duty, breach of contract and an
accounting, alleging, among other things, that the management fees paid to the
McNeil affiliates over the last six years are excessive, that these fees should
be reduced retroactively and that the respective Amended Partnership Agreements
governing the Partnerships are invalid.
<PAGE>
Defendants filed a demurrer to the consolidated and amended complaint and a
motion to strike on February 14, 1997, seeking to dismiss the consolidated and
amended complaint in all respects. A hearing on Defendant's demurrer and motion
to strike was held on May 5, 1997. The Court granted Defendants' demurrer,
dismissing the consolidated and amended complaint with leave to amend. On
October 31, 1997, the Plaintiffs filed a second consolidated and amended
complaint. The case was stayed pending settlement discussions. A Stipulation of
Settlement dated September 15, 1998 has been signed by the parties. Preliminary
Court approval was received on October 6, 1998. A hearing for Final Approval of
Settlement, initially scheduled for December 17, 1998, has been continued to
July 2, 1999.
Because McNeil Real Estate Fund XXIII, L.P., Hearth Hollow Associates, McNeil
Midwest Properties I, L.P. and Regency North Associates, L.P. would be part of
the transaction contemplated in the settlement and Plaintiffs claim that an
effort should be made to sell the McNeil Partnerships, Plaintiffs have included
allegations with respect to McNeil Real Estate Fund XXIII, L.P., Hearth Hollow
Associates, McNeil Midwest Properties I, L.P. and Regency North Associates, L.P.
in the third consolidated and amended complaint.
Plaintiff's counsel intends to seek an order awarding attorney's fees and
reimbursements of their out-of-pocket expenses. The amount of such award is
undeterminable until final approval is received from the court. Fees and
expenses shall be allocated amongst the Partnerships on a pro rata basis, based
upon tangible asset value of each such partnership, less total liabilities,
calculated in accordance with the Amended Partnership Agreements for the quarter
most recently ended.
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits.
Exhibit
Number Description
------- -----------
4. Amended and Restated Limited Partnership
Agreement dated March 26, 1992 (incorporated
by reference to the Current Report of the
registrant on Form 8-K dated March 26, 1992,
as filed on April 9, 1992).
4.1 Amendment No. 1 to the Amended and Restated
Limited Partnership Agreement of McNeil Real
Estate Fund XXV, L.P. dated June 1995
(incorporated by reference to the Quarterly
Report of the registrant on form 10-Q for
the period ended June 30, 1995, as filed on
August 14, 1995).
11. Statement regarding computation of Net
Income (Loss) per Thousand Limited
Partnership Units: Net income (loss) per
thousand limited partnership units is
computed by dividing net income (loss)
allocated to the limited partners by the
weighted average number of limited
partnership units outstanding expressed in
thousands. Per thousand unit information has
been computed based on 82,944 weighted
average thousand limited partnership units
outstanding in 1999 and 1998.
27. Financial Data Schedule for the quarter
ended March 31, 1999.
(b) Reports on Form 8-K. There were no reports on Form 8-K filed during
the quarter ended March 31, 1999.
<PAGE>
MCNEIL REAL ESTATE FUND XXV, L.P.
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:
McNEIL REAL ESTATE FUND XXV, L.P.
By: McNeil Partners, L.P., General Partner
By: McNeil Investors, Inc., General Partner
May 18, 1999 By: /s/ Ron K. Taylor
- -------------- ---------------------------------------------
Date Ron K. Taylor
President and Director of McNeil
Investors, Inc.
(Principal Financial Officer)
May 18, 1999 By: /s/ Carol A. Fahs
- -------------- ---------------------------------------------
Date Carol A. Fahs
Vice President of McNeil Investors, Inc.
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 3,443,780
<SECURITIES> 0
<RECEIVABLES> 1,097,931
<ALLOWANCES> (530,164)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 52,637,235
<DEPRECIATION> (29,888,625)
<TOTAL-ASSETS> 36,866,022
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0
0
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<TOTAL-REVENUES> 2,547,423
<CGS> 1,141,837
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<OTHER-EXPENSES> 298,627
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<INTEREST-EXPENSE> 193,927
<INCOME-PRETAX> 349,565
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<INCOME-CONTINUING> 349,565
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<EXTRAORDINARY> 0
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<NET-INCOME> 349,565
<EPS-PRIMARY> 0
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</TABLE>
