FORM 10-Q--QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
OF THE SECURITIES EXCHANGE ACT OF 1934
(As last amended in Rel. No. 312905, eff. 4/26/93.)
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 the quarterly period ended March 31, 1997
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from.........to.........
(Amended by Exchange Act Rel. No. 312905, eff. 4/26/93.)
Commission file number 0-15710
CENTURY PENSION INCOME FUND XXIV
(Exact name of registrant as specified in its charter)
California 94-2984976
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Insignia Financial Plaza
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip Code)
(864) 239-1000
(Registrant's telephone number)
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 .
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) CENTURY PENSION INCOME FUND XXIV
BALANCE SHEETS
(in thousands, except unit data)
March 31, December 31,
1997 1996
(Unaudited) (Note)
Assets
Cash and cash equivalents $ 2,043 $ 1,929
Receivables and other assets 329 488
Investments in unconsolidated joint ventures 7,931 7,844
Investment properties:
Land 4,397 4,397
Buildings and related personal property 13,379 13,379
17,776 17,776
Accumulated depreciation (3,824) (3,704)
13,952 14,072
$ 24,255 $ 24,333
Liabilities and Partners' Capital
Liabilities
Accrued expenses and other liabilities $ 108 $ 140
Partners' Capital
General partners' -- --
Limited partners (73,341 units issued and
outstanding at March 31, 1997, and
December 31, 1996) 24,147 24,193
Total partners' capital 24,147 24,193
$ 24,255 $ 24,333
Note: The balance sheet at December 31, 1996, has been derived from the
audited financial statements at that date but does not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements.
See Accompanying Notes to Financial Statements
b) CENTURY PENSION INCOME FUND XXIV
STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
Three Months Ended
March 31,
1997 1996
Revenues:
Rental income $ 507 $ 579
Other income 26 28
Equity in income of unconsolidated
joint ventures 87 64
Total revenues 620 671
Expenses:
Operating 149 109
General and administrative 119 164
Depreciation 120 118
Total expenses 388 391
Net income $ 232 $ 280
Net income allocated to general partner $ 3 $ 3
Net income allocated to limited partners 229 277
$ 232 $ 280
Net income per limited partnership unit $ 3.13 $ 3.78
Cash distributions per limited
partnership unit $ 3.75 $ 3.75
See Accompanying Notes to Financial Statements
c) CENTURY PENSION INCOME FUND XXIV
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
(Unaudited)
(in thousands, except unit data)
Limited
Partnership General Limited
Units Partners' Partners' Total
Original capital contributions 73,341 $ -- $ 36,671 $ 36,671
Partners' capital
at December 31, 1996 73,341 $ -- $ 24,193 $ 24,193
Net income for the three
months ended March 31, 1997 3 229 232
Distributions to partners (3) (275) (278)
Partners' capital
at March 31, 1997 73,341 $ -- $ 24,147 $ 24,147
See Accompanying Notes to Financial Statements
d) CENTURY PENSION INCOME FUND XXIV
STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended
March 31,
1997 1996
Cash flows from operating activities:
Net income $ 232 $ 280
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 120 118
Amortization of lease commissions 11 9
Equity in income of unconsolidated joint
ventures' operations (87) (64)
Change in accounts:
Receivables and other assets 148 (164)
Accrued expenses and other liabilities (32) 18
Net cash provided by operating activities 392 197
Cash flows from investing activities:
Contributions to unconsolidated joint venture -- (38)
Net cash used in investing activities -- (38)
Cash flows from financing activities:
Distributions to partners (278) (278)
Net cash used in financing activities (278) (278)
Increase (decrease) in cash and cash equivalents 114 (119)
Cash and cash equivalents at beginning of period 1,929 2,190
Cash and cash equivalents at end of period $ 2,043 $ 2,071
See Accompanying Notes to Financial Statements
e) CENTURY PENSION INCOME FUND XXIV
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
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 Fox Capital Management Corporation, the Managing General
Partner, 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, 1997, are not necessarily indicative of the
results that may be expected for the fiscal year ending December 31, 1997. 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, 1996.
Certain reclassifications have been made to the 1996 information to conform to
the 1997 presentation.
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 Agreement provides for payments to
affiliates 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
charged to expense in 1997 and 1996 (in thousands):
For the Three Months Ended
March 31,
1997 1996
Partnership management fee (included in general
and administrative expenses) $ 31 $ 31
Reimbursement for services of affiliates (included
in general and administrative expenses) 15 54
Since January 19, 1996, the Partnership insured its properties under a master
policy through an agency and 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 current year's
master policy. The current agent assumed the financial obligations to the
affiliate of the Managing General Partner who received payments on these
obligations from the agent. The amount of the Partnership's insurance premiums
accruing to the benefit of the affiliate of the Managing General Partner by
virtue of the agent's obligations is not significant.
The general partner received cash distributions of approximately $3,000 during
the three months ended March 31, 1997 and 1996.
NOTE C - INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES
The Partnership has investments in two unconsolidated joint ventures as follows:
Coral Palm Plaza Joint Venture
On January 23, 1987, the Partnership acquired a 33.33% ownership interest in
Coral Palm Plaza Joint Venture ("Coral Palm"), a joint venture with Century
Pension Income Fund XXIII, a California Limited Partnership ("CPIF XXIII") and
an affiliate of the Managing General Partner. Also, on January 23, 1987, Coral
Palm Plaza Joint Venture acquired the Coral Palm Plaza, a shopping center
located in Coral Springs, Florida. The Partnership's interest in the Coral Palm
Plaza Joint Venture is reported using the equity method of accounting.
Summary financial information for Coral Palm Plaza Joint Venture is as follows
(in thousands):
March 31, December 31
1997 1996
Total assets $ 7,167 $ 7,301
Total liabilities (357) (468)
Total ventures' equity $ 6,810 $ 6,833
For the Three Months Ended
March 31,
1997 1996
Total revenues $ 218 $ 279
Total expenses (241) (333)
Net loss $ (23) $ (54)
In 1997, the Partnership did not receive a distribution from the Joint Venture.
In 1996, the Partnership paid contributions of approximately $38,000 to the
Joint Venture.
Minneapolis Business Parks Joint Venture
On April 30, 1987, the Partnership acquired a 32% ownership interest in
Minneapolis Business Parks Joint Venture, a joint venture with CPIF XXIII. On
May 5, 1987, Minneapolis Business Parks Joint Venture acquired Alpha Business
Center located in Bloomington, Minnesota; Plymouth Service Center located in
Plymouth, Minnesota, and Westpoint Business Center located in Plymouth,
Minnesota. The Partnership's interest in the Minneapolis Business Parks Joint
Venture is reported using the equity method of accounting.
Summary financial information for Minneapolis Business Park Joint Venture is as
follows (in thousands):
March 31, December 31,
1997 1996
Total assets $17,876 $17,412
Total liabilities (346) (176)
Total ventures' equity $17,530 $17,236
For the Three Months Ended
March 31,
1997 1996
Total revenues $ 822 $ 766
Total expenses (528) (509)
Net income $ 294 $ 257
In 1997 and 1996, the Partnership did not receive a distribution from the Joint
Venture.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's investment properties consist of three wholly-owned shopping
centers, as well as three business parks and one shopping center owned by two
unconsolidated joint ventures between the Partnership and an affiliated
partnership. The following table sets forth the average occupancy of the three
wholly-owned properties for the three months ended March 31, 1997 and 1996:
Average
Occupancy
Property 1997 1996
Butler Square Center
Mauldin, South Carolina 100% 97%
Kenilworth Commons Shopping Center
Charlotte, North Carolina 100% 100%
Plantation Pointe Shopping Center
Smyrna, Georgia 98% 98%
The Managing General Partner attributes the increased occupancy at Butler Square
Shopping Center to the growing local economy, which has been strongly influenced
by the introduction of two major employers into the market.
The Partnership's net income for the three months ended March 31, 1997 was
approximately $232,000 versus approximately $280,000 for the same period of
1996. The decrease in net income is primarily attributable to a decrease in
rental income and an increase in operating expenses. The decrease in rental
income is due to a decrease in rental rates at Kenilworth Commons and Plantation
Pointe Shopping Centers to maintain current occupancy levels. Also contributing
to the decrease in rental income was a decrease in common area maintenance
("CAM") revenue at all three of the investment properties. The increase in
operating expenses is due to landscaping at Plantation Pointe and parking lot
repairs at Butler Square. Additionally, operating expenses increased due to an
increase in real estate taxes at Butler Square which were due to a reassessment
of the property in 1996. Included in operating expense is $7,000 of major
repairs and maintenance comprised of landscaping for the quarter ended March 31,
1997.
Partially offsetting the decrease in net income was an increase in income from
unconsolidated joint venture and a decrease in general and administrative
expenses. The increase in income from unconsolidated joint ventures is primarily
attributable to a decrease in the loss at Coral Palm Plaza. The decrease in
loss is due to the recognition of bad debt expense in the first quarter of 1996
related to two major tenants, who subsequently vacated their space in 1996. The
decrease in general and administrative expenses is attributable to a decrease in
expense reimbursements. The decrease in expense reimbursements during the three
months ended March 31, 1997, is directly attributable to the combined transition
efforts of the Greenville, South Carolina and Atlanta, Georgia, administrative
offices during the 1995 year-end close, preparation of the 1995 10-K and tax
return (including the limited partner K-1's) and transition of asset management
responsibilities to the new administration during the three months ended March
31, 1996.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of its investment properties to
assess the feasibility of increasing rents, maintaining or increasing occupancy
levels and protecting the Partnership from increases in expense. 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.
At March 31, 1997, the Partnership had unrestricted cash of approximately
$2,043,000 as compared to $2,071,000 at March 31, 1996. Net cash provided by
operating activities increased due to the decrease in receivables and other
assets. The decrease in receivables and other assets is primarily attributable
to the decrease in common area maintenance receivables due to the timing of
receipts. Net cash used in investing activities decreased due to a contribution
by the Partnership to the Coral Palm Plaza Joint Venture in 1996. The
contribution was necessary to help fund tenant improvements at Coral Palm. Net
cash used in financing activities remained constant, representing distributions
of $278,000 to the partners for the three months ended March 31, 1997 and 1996.
The Partnership has no material capital programs scheduled to be performed in
1997, although certain routine capital expenditures and maintenance expenses
have been budgeted. These capital expenditures and maintenance expenses will be
incurred only if cash is available from operations or is received from the
capital reserve account.
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 property to adequately maintain the physical assets
and other operating needs of the Partnership. Such assets are currently thought
to be sufficient for any near-term needs of the partnership. The Partnership
distributed $278,000 to the partners (including $3,000 to the general partner)
during the three months ended March 31, 1997 and 1996. Future cash
distributions will depend on the levels of cash generated from operations,
property sales, and the availability of cash reserves, however, quarterly
distributions are expected to continue throughout 1997. The level of such
distributions will be contingent upon successful future operations.
PART II - OTHER INFORMATION
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 were filed for the quarter ended March 31, 1997.
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.
CENTURY PENSION INCOME FUND XXIV,
By: Fox Partners VI
Its General Partner
By: Fox Capital Management Corporation
Its Managing General Partner
By: /s/William H. Jarrard, Jr.
William H. Jarrard, Jr.
President and Director
By: /s/Ronald Uretta
Ronald Uretta
Principal Financial Officer
and Principal Accounting Officer
Date: April 28, 1997
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<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Pension Income Fund XXIV 1997 First Quarter 10-Q and is qualified in its
entirety by reference to such 10-Q filing.
</LEGEND>
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<NAME> CENTURY PENSION INCOME FUND XXIV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
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<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
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<PP&E> 17,776
<DEPRECIATION> (3,824)
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<OTHER-SE> 24,147
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