UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period ended June 30, 1997
----------------------------------------------------
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 0-15459
---------
McNEIL REAL ESTATE FUND XXIII, L.P.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 33-0139793
- --------------------------------------------------------------------------------
(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>
MCNEIL REAL ESTATE FUND XXIII, L.P.
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- ------- --------------------
BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
--------------- ---------------
ASSETS
- ------
Real estate investments:
<S> <C> <C>
Land..................................................... $ 239,966 $ 239,966
Buildings and improvements............................... 6,075,732 6,029,898
-------------- --------------
6,315,698 6,269,864
Less: Accumulated depreciation.......................... (3,054,860) (2,915,422)
-------------- --------------
3,260,838 3,354,442
Cash and cash equivalents................................... 331,509 193,812
Cash segregated for security deposits....................... 43,729 43,296
Accounts receivable and other assets........................ 17,267 13,249
Escrow deposits............................................. 51,228 96,624
-------------- -------------
$ 3,704,571 $ 3,701,423
============== =============
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
- ------------------------------------------
Mortgage note payable, net of discount...................... $ 3,742,732 $ 3,758,380
Accounts payable and accrued expenses....................... 71,197 73,579
Accrued property taxes...................................... 61,146 43,519
Payable to affiliates - General Partner..................... 327,923 258,782
Security deposits and deferred rental revenue............... 47,829 42,553
-------------- --------------
4,250,827 4,176,813
-------------- --------------
Partners' equity (deficit):
Limited partners - 45,000,000 Units authorized;
11,512,696 and 11,622,696 Units outstanding at
June 30, 1997 and December 31, 1996, respectively
(6,651,985 and 6,681,985 Current Income Units out-
standing at June 30, 1997 and December 31, 1996,
respectively, and 4,860,711 and 4,940,711 Growth/
Shelter Units outstanding at June 30, 1997 and
December 31, 1996, respectively)....................... (5,398,007) (5,327,850)
General Partner.......................................... 4,851,751 4,852,460
-------------- --------------
(546,256) (475,390)
-------------- --------------
$ 3,704,571 $ 3,701,423
============== ==============
</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 XXIII, L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------------------- ---------------------------------
1997 1996 1997 1996
-------------- --------------- -------------- --------------
Revenue:
<S> <C> <C> <C> <C>
Rental revenue................ $ 343,315 $ 325,699 $ 685,614 $ 644,567
Interest...................... 2,807 2,078 4,998 4,220
------------- ------------- ------------- -------------
Total revenue............... 346,122 327,777 690,612 648,787
------------- ------------- ------------- -------------
Expenses:
Interest...................... 85,496 91,665 173,024 183,543
Depreciation.................. 70,886 66,639 139,438 130,536
Property taxes................ 30,573 31,000 61,146 59,752
Personnel expenses............ 42,261 45,339 94,183 100,780
Utilities..................... 26,516 25,990 58,068 62,849
Repair and maintenance........ 47,568 58,639 82,224 90,210
Property management
fees - affiliates........... 17,030 16,311 34,417 32,272
Other property operating
expenses.................... 13,969 17,612 27,059 35,336
General and administrative.... 9,636 10,559 22,868 21,446
General and administrative -
affiliates.................. 35,368 35,023 69,051 70,856
Reorganization expenses....... - 999 - 5,362
------------- ------------- ------------- -------------
Total expenses.............. 379,303 399,776 761,478 792,942
------------- ------------- ------------- -------------
Net loss......................... $ (33,181) $ (71,999) $ (70,866) $ (144,155)
============= ============= ============= =============
Net loss allocated to
limited partners - Current
Income Units.................. $ (2,986) $ (6,480) $ (6,378) $ (12,974)
Net loss allocated to
limited partners - Growth/
Shelter Units................. (29,863) (64,799) (63,779) (129,739)
Net loss allocated to
General Partner............... (332) (720) (709) (1,442)
------------- ------------- ------------- -------------
Net loss......................... $ (33,181) $ (71,999) $ (70,866) $ (144,155)
============= ============= ============= =============
Net loss per thousand limited
partnership units:
Current Income Units.......... $ (.45) $ (.97) $ (.96) $ (1.94)
============ ============= ============= =============
Growth/Shelter Units.......... $ (6.14) $ (13.12) $ (13.12) $ (26.26)
============ ============= ============= =============
</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 XXIII, L.P.
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
(Unaudited)
For the Six Months Ended June 30, 1997 and 1996
<TABLE>
<CAPTION>
Total
General Limited Partners'
Partner Partners Equity (Deficit)
-------------- --------------- ----------------
<S> <C> <C> <C>
Balance at December 31, 1995.............. $ 4,854,261 $ (5,145,030) $ (290,769)
Redemption of limited partner units:
Current Income Units................... - (2,737) (2,737)
Growth/Shelter Units................... - (1,743) (1,743)
------------- ------------- -------------
Total redemption..................... - (4,480) (4,480)
------------- ------------- -------------
Net loss:
General Partner........................ (1,442) - (1,442)
Current Income Units................... - (12,974) (12,974)
Growth/Shelter Units................... - (129,739) (129,739)
------------- ------------- -------------
Total net loss....................... (1,442) (142,713) (144,155)
------------- ------------- -------------
Balance at June 30, 1996.................. $ 4,852,819 $ (5,292,223) $ (439,404)
============= ============= =============
Balance at December 31, 1996.............. $ 4,852,460 $ (5,327,850) $ (475,390)
Net loss:
General Partner........................ (709) - (709)
Current Income Units................... - (6,378) (6,378)
Growth/Shelter Units................... - (63,779) (63,779)
------------- ------------- -------------
Total net loss....................... (709) (70,157) (70,866)
------------- ------------- -------------
Balance at June 30, 1997.................. $ 4,851,751 $ (5,398,007) $ (546,256)
============= ============= =============
</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 XXIII, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>
Six Months Ended
June 30,
------------------------------------
1997 1996
---------------- ---------------
Cash flows from operating activities:
<S> <C> <C>
Cash received from tenants............................... $ 695,166 $ 658,764
Cash paid to suppliers................................... (247,343) (372,490)
Cash paid to affiliates.................................. (34,327) (32,309)
Interest received........................................ 4,998 4,220
Interest paid............................................ (164,363) (175,267)
Property taxes paid and escrowed......................... (46,139) (53,383)
-------------- --------------
Net cash provided by operating activities................... 207,992 29,535
-------------- --------------
Cash flows from investing activities:
Additions to real estate investments..................... (45,834) (102,003)
-------------- --------------
Cash flows from financing activities:
Principal payments on mortgage note
payable................................................ (24,461) (22,696)
Redemption of limited partner units...................... - (4,480)
-------------- --------------
Net cash used in financing activities....................... (24,461) (27,176)
-------------- --------------
Net increase (decrease) in cash and cash
equivalents.............................................. 137,697 (99,644)
Cash and cash equivalents at beginning of
period................................................... 193,812 233,222
-------------- --------------
Cash and cash equivalents at end of period.................. $ 331,509 $ 133,578
============== ==============
</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 XXIII, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
Reconciliation of Net Loss to Net Cash Provided by Operating Activities
<TABLE>
<CAPTION>
Six Months Ended
June 30,
------------------------------------
1997 1996
---------------- ----------------
<S> <C> <C>
Net loss.................................................... $ (70,866) $ (144,155)
-------------- --------------
Adjustments to reconcile net loss to net cash provided
by operating activities:
Depreciation............................................. 139,438 130,536
Amortization of discount on mortgage
note payable........................................... 8,813 8,418
Changes in assets and liabilities:
Cash segregated for security deposits.................. (433) 12,078
Accounts receivable and other assets................... (4,018) 7,329
Escrow deposits........................................ 45,396 (11,608)
Accounts payable and accrued expenses.................. (2,382) (53,033)
Accrued property taxes................................. 17,627 16,610
Payable to affiliates - General Partner................ 69,141 70,819
Security deposits and deferred rental
revenue.............................................. 5,276 (7,459)
-------------- --------------
Total adjustments.................................... 278,858 173,690
-------------- --------------
Net cash provided by operating activities................... $ 207,992 $ 29,535
============== ==============
</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 XXIII, L.P.
Notes to Financial Statements
(Unaudited)
June 30, 1997
NOTE 1.
- -------
McNeil Real Estate Fund XXIII, L.P. (the "Partnership"), formerly known as
Southmark Realty Partners III, Ltd., was organized on March 4, 1985 as a limited
partnership under provisions of the California Revised Limited Partnership Act
to acquire and operate 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 six months ended June 30, 1997, are
not necessarily indicative of the results to be expected for the year ending
December 31, 1997.
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, 1996, and the notes thereto, as filed with the
Securities and Exchange Commission, which is available upon request by writing
to McNeil Real Estate XXIII, L.P., c/o The Herman Group, 2121 San Jacinto St.,
26th Floor, Dallas, Texas 75201.
NOTE 3.
- -------
On June 30, 1994, the Partnership filed a voluntary petition for Chapter 11
reorganization. (The petition for Chapter 11 reorganization excluded the
Partnership's interest in Beckley Associates, the owner of Harbour Club II
Apartments.) The Partnership continued to conduct its affairs as a
debtor-in-possession, subject to the jurisdiction and supervision of the
Bankruptcy Court.
The Partnership's First Amended Plan of Reorganization ("Reorganization Plan"),
which contemplated a sale of Woodbridge Apartments, was submitted to the
Bankruptcy Court on February 13, 1995. The Partnership's Disclosure Statement of
Debtor-in-Possession ("Disclosure Statement") was approved by the Bankruptcy
Court on February 14, 1995.
The Partnership's Reorganization Plan and Disclosure Statement were submitted
February 20, 1995, to a vote of the impaired creditors, as defined. The impaired
creditors included a class of creditors who had filed a judgment lien against
Woodbridge Apartments in connection with the Illinois rescission suit. The
judgment lien creditors filed objections to confirmation of the Reorganization
Plan. On April 18, 1995, the Bankruptcy Court did grant an order to sell
<PAGE>
Woodbridge Apartments but denied confirmation of the Reorganization Plan. The
Partnership filed an appeal of the Bankruptcy Court's ruling and, in the
meantime, attempted to settle the matter with the judgment lien creditors, which
would allow for confirmation of the Reorganization Plan. On May 10, 1995, the
Reorganization Plan was amended to provide for full payment to the judgment lien
creditors. The Reorganization Plan, as amended, was subsequently confirmed by
the Bankruptcy Court on May 17, 1995.
Woodbridge Apartments was sold on May 25, 1995, and, in accordance with the
Reorganization Plan, the first and second mortgage notes payable and the related
outstanding accrued interest were paid. The Partnership also utilized $156,566
of the proceeds from the sale to pay the settlement and legal fees to the
judgment lien creditors, as discussed above.
On September 11, 1995, the Bankruptcy Court entered an Order Regarding
Objections to Claims that allowed the Partnership to pay outstanding
pre-petition claims totaling approximately $124,000 in October 1995.
The Reorganization Plan specified that advances and fees owed to affiliates of
the General Partner were limited to remaining cash, after the pre-petition
liabilities and reorganization expenses were paid. The Partnership had $37,228
of cash available to distribute to affiliate creditors. The remaining amounts
owed to affiliates of the General Partner as of May 17, 1995, were discharged
resulting in an extraordinary gain of $1,398,925 during the third quarter of
1995.
On August 15, 1995, the Partnership sent an election form to each limited
partner which allowed them to choose whether to redeem their interest in the
Partnership. The redemption price was 1/1000th of a dollar per Unit. The limited
partners were required to respond within 30 days, and at the close of the 30 day
period, 311 limited partners had elected to redeem 4,485,345 Units. In
connection with the redemption, the partnership obtained a "no-action" letter
from the Securities and Exchange Commission ("SEC") that provided that (1) the
redemption could be accomplished without compliance with Rule 13e-3 of the
Securities Exchange Act of 1934, and (2) the SEC did not intend to pursue an
enforcement action if the Reorganization Plan was consummated. Redemption of the
affected Units was completed in January 1996.
On November 18, 1995, the Partnership submitted a request for an Application to
Close Case to the Bankruptcy Court, which was entered on December 11, 1995, and
was approved on February 15, 1996.
Expenses incurred by the Partnership in connection with its Chapter 11 filing
have been expensed as "reorganization expenses" in the accompanying Statements
of Operations.
NOTE 4.
- -------
The Partnership pays property management fees equal to 5% of the gross rental
receipts for its property to McNeil Real Estate Management, Inc. ("McREMI"), an
affiliate of the General Partner, for providing property management and leasing
services.
The Partnership reimburses McREMI for its costs, including overhead, of
administering the Partnership's affairs.
<PAGE>
The Partnership incurs asset management fees which are 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 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 subsequent to
1999. Asset management fees accrued prior to the confirmation of the
Reorganization Plan were discharged pursuant to the Reorganization Plan. Total
accrued but unpaid asset management fees incurred subsequent to confirmation of
the Reorganization Plan in the amount of $165,166 were outstanding at June 30,
1997.
Compensation and reimbursements paid to or accrued for the benefit of the
General Partner and its affiliates are as follows:
Six Months Ended
June 30,
----------------------
1997 1996
--------- ---------
Property management fees......................... $ 34,417 $ 32,272
Charged to general and administrative -
affiliates:
Partnership administration.................... 29,782 39,927
Asset management fee.......................... 39,269 30,929
-------- --------
$ 103,468 $ 103,128
======== ========
Payable to affiliates - General Partner at June 30, 1997, and December 31, 1996,
consists primarily of unpaid asset management fees and reimbursable costs that
are due and payable from current operations.
NOTE 5.
- -------
The accompanying financial statements have been prepared assuming the
Partnership will continue as a going concern. The Partnership has suffered
recurring losses from operations. Operations at Harbour Club II Apartments, the
Partnership's sole remaining property, are expected to be sufficient to provide
cash for operating expenses and debt service for 1997. However, the property is
in need of major capital improvements in order to maintain occupancy and rental
rates at a level sufficient to fund operating expenses and debt service in
future years. The Partnership's cash reserves are inadequate to fund the needed
capital improvements, and it is unlikely that cash flow from operating
activities will be sufficient to provide for the needed capital improvements. No
outside sources of financing have been identified. Although affiliates of the
Partnership have previously provided working capital for the Partnership, there
can be no assurance that the Partnership will receive additional funds from the
General Partner or other affiliates. Management is currently attempting to
negotiate a restructuring or refinancing of the mortgage note payable to fund
the needed capital improvements; however, such financing is not assured. If the
Partnership is unable to obtain additional funds and cannot maintain operations
at a level to pay operating expenses and debt service, Harbour Club II
Apartments may ultimately be foreclosed on by the lender.
<PAGE>
These conditions raise substantial doubt about the Partnership's ability to
continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------- ---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Partnership's operating activities provided $207,992 for the first six
months of 1997 as compared to $29,535 for the first six months of 1996. The
change in cash flow from operations was due to an increase in cash received from
tenants and a decrease in cash paid to suppliers. See discussion of increase in
rental revenue and decline in Partnership expenses below. Cash paid to suppliers
decreased also due to a receipt of $50,000 for property replacements from escrow
previously held by HUD, the former mortgage holder of Harbour Club II
Apartments, in 1997.
Cash used for additions to real estate improvements totaled $45,834 for the six
months ended June 30, 1997 as compared to $102,003 for the same period of 1996.
A greater amount was spent at Harbour Club II Apartments for hallway upgrades in
1996.
Scheduled principal payments on mortgage note payable totaled $24,461 for the
six months ended June 30, 1997 as compared to $22,696 for the same period of
1996. In accordance with terms of the Partnership's Reorganization Plan, the
Partnership redeemed 4,485,345 limited partnership units from the limited
partners for a total of $4,480 during the first half of 1996.
Short-term liquidity:
At June 30, 1997, the Partnership held $331,509 of cash and cash equivalents.
The General Partner anticipates rental operations at Harbour Club II Apartments
in 1997 will provide sufficient rental revenue to pay for the operating expenses
of the property and debt service payments on the property's mortgage note.
However, rental operations at Harbour Club II Apartments are not expected to be
sufficient to fund necessary capital improvements to the property nor to pay the
Partnership's other expenses. To the extent available, the Partnership will use
its cash reserves to fund limited capital improvements and the Partnership's
other expenses.
Although the sale of Woodbridge Apartments in May 1995 provided some additional
cash reserves for the Partnership, the Partnership still faces liquidity
problems because of urgently needed capital improvements at Harbour Club II
Apartments for which no financing has been secured. Operating activities at
Harbour Club II Apartments for 1997 are expected to provide sufficient positive
cash flow for normal operating expenses and debt service payments. However, the
needed capital improvements will require the use of other sources of cash. No
such sources have been identified. The Partnership has no established lines of
credit from outside sources. Effective January 23, 1997, the mortgage note
payable was sold by HUD to an unaffiliated lender.
<PAGE>
The General Partner has in the past, at its discretion, advanced funds to the
Partnership that were used to fund working capital requirements. Such advances
were discharged as a result of the Chapter 11 proceedings. The General Partner
is not obligated to advance funds to the Partnership and there is no assurance
that the Partnership will receive additional funds.
Long-term liquidity:
The Partnership has been in a distressed cash situation for several years.
Although Harbour Club II Apartments is able to operate in such a manner as to
provide for operating expenses and debt service payments, the property has not
proven the capability to produce the cash flow necessary for capital
improvements nor to support Partnership operations. The inability to make
necessary capital improvements has led to deteriorating conditions at the
property. In the opinion of management, if capital improvements are not made to
make the property more marketable, the estimated fair value of the property may
be further impaired.
These conditions raise substantial doubt about the Partnership's ability to
continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
The Partnership determined to evaluate market and other economic conditions to
establish the optimum time to commence liquidation of the Partnership's property
in accordance with the terms of the Amended Partnership Agreement. Although
there can be no assurance as to the timing of the liquidation due to real estate
market conditions, the general difficulty of disposing of real estate, and other
general economic factors, it is anticipated that such liquidation would result
in the dissolution of the Partnership followed by a liquidating distribution to
Unitholders by December 2001.
Distributions
To maintain adequate cash balances, the Partnership suspended distributions to
Current Income Unit holders in 1988. There have been no distributions to
Growth/Shelter Unit holders. Distributions to Unit holders will remain suspended
for the foreseeable future. The General Partner will continue to monitor the
cash reserves and working capital needs of the Partnership to determine when
cash flows will support distributions to the Unit holders.
FINANCIAL CONDITION
- -------------------
The occupancy rate at Harbour Club II Apartments decreased to 89% at June 30,
1997. The occupancy rate at December 31, 1996, was 92%. Harbour Club II
Apartments was able to provide enough cash flow from operations to meet ordinary
operating expenses as well as the debt service for its related mortgage note for
the first six months of 1997; however, as discussed above, the property is in
need of major capital improvements in order to compete in its local market. The
Partnership is attempting to negotiate a restructuring or refinancing of the
mortgage note payable to fund the necessary improvements; however, such
restructuring or refinancing is not assured.
<PAGE>
Harbour Club II Apartments is part (Phase II) of a four-phase apartment complex
located in Belleville, Michigan. Phases I and III of the complex are owned by
partnerships in which the General Partner is the general partner; while Phase IV
is owned by an unaffiliated partnership. McREMI managed all four phases of the
complex until December 1992, when the property management agreement between
McREMI and the unaffiliated partnership was canceled. Additionally, in January
1993, Phase I defaulted on its mortgage note. In the beginning of July 1997, the
mortgage note was reinstated after Phase I has made all the delinquent payments
and late charges. Regular monthly mortgage payments were resumed in July 1997.
RESULTS OF OPERATIONS
- ---------------------
Revenue:
Total Partnership revenues were $346,122 and $690,612 for the three and six
months ended June 30, 1997, respectively, as compared to $327,778 and $648,787
for the same periods of 1996.
Rental revenue at Harbour Club II Apartments increased $17,616 and $41,047, or
5.4% and 6.0%, for the three and six months ended June 30, 1997, respectively,
as compared to the same periods of 1996. Increases in base rental rates at
Harbour Club II Apartments were the principal factor leading to the increase in
rental revenue.
Interest income increased $729 and $778 for the three and six months ended June
30, 1997, respectively, as compared to the same periods of 1996. The increase
was due to a higher amount of cash available for short-term investment in 1997.
The Partnership held $331,000 of cash and cash equivalents at June 30, 1997 as
compared to $134,000 at June 30, 1996.
Expenses:
Total Partnership expenses decreased $20,473 and $31,464, or 5.1% and 4.0%, for
the three and six months ended June 30, 1997, respectively, as compared to the
same periods of 1996.
Repairs and maintenance decreased $11,071 and $7,986 for the three and six
months ended June 30, 1997, respectively, as compared to the same periods of
1996 due to decreased replacement of floor coverings at Harbour Club II
Apartments.
Other property operating expenses decreased $3,643 and $8,277 at Harbour Club II
Apartments for the three and six months ended June 30, 1997, respectively,
compared to the same periods of 1996. The decrease was attributable to the
accrual of HUD audit fees in 1996. No such fees were accrued in 1997 due to the
sale of the mortgage note by HUD to an unaffiliated lender in January 1997.
Reorganization expenses incurred by the Partnership in connection with its
Chapter 11 filing were $999 and $5,362 for the three and six months ended June
30, 1996, respectively. No such costs were incurred in 1997.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits.
Exhibit
Number Description
------- -----------
4. Amended and Restated Limited Partnership
Agreement dated March 30, 1992.
(Incorporated by reference to the Current
Report of the Registrant on Form 8-K dated
March 30, 1992, as filed on April 10, 1992).
11. Statement regarding computation of Net
Income (Loss) per Thousand Limited
Partnership Units: Net income (loss) per
thousand limited partner 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 unit
information has been computed based on 6,652
and 6,682 Current Income Units (in
thousands) outstanding in 1997 and 1996,
respectively, and 4,861 and 4,941
Growth/Shelter Units (in thousands)
outstanding in 1997 and 1996, respectively.
27. Financial Data Schedule for the quarter
ended June 30, 1997.
b) Reports on Form 8-K. There were no reports on Form 8-K filed during the
quarter ended June 30, 1997.
<PAGE>
McNEIL REAL ESTATE FUND XXIII, L.P.
(Debtor-in-Possession)
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 XXIII, L.P.
By: McNeil Partners, L.P., General Partner
By: McNeil Investors, Inc., General Partner
August 13, 1997 By: /s/ Ron K. Taylor
- ---------------- ----------------------------------------
Date Ron K. Taylor
President and Director of McNeil
Investors, Inc.
(Principal Financial Officer)
August 13, 1997 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> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 331,509
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 6,315,698
<DEPRECIATION> (3,054,860)
<TOTAL-ASSETS> 3,704,571
<CURRENT-LIABILITIES> 0
<BONDS> 3,742,732
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 3,704,571
<SALES> 685,614
<TOTAL-REVENUES> 690,612
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 588,454
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 173,024
<INCOME-PRETAX> 0
<INCOME-TAX> 0
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (70,866)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
