<PAGE>1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 1995
-----------------
Commission file number 1-12704
-----------------
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
-----------------------------------------------------------------
(Exact name of registrant as specified in charter)
Delaware 13-2943272
------------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11200 Rockville Pike, Rockville, Maryland 20852
----------------------------------------- ----------------------
(Address of principal executive offices) (Zip Code)
(301) 816-2300
-----------------------------------------------------------------
(Registrant's telephone number, including area code)
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
---- ----
As of August 11, 1995, 9,576,290 Depositary Units of Limited Partnership
Interest were outstanding.
<PAGE>2
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
INDEX TO FORM 10-Q
FOR THE QUARTER ENDED JUNE 30, 1995
Page
----
PART I. Financial Information
Item 1. Financial Statements
Balance Sheets - June 30, 1995 (unaudited)
and December 31, 1994 . . . . . . . . . . . 3
Statements of Operations - for the
three and six months ended June 30,
1995 and 1994 (unaudited) . . . . . . . . . 4
Statement of Changes in Partners' Equity -
for the six months ended June 30,
1995 (unaudited) . . . . . . . . . . . . . 5
Statements of Cash Flows - for the six
months ended June 30, 1995
and 1994 (unaudited) . . . . . . . . . . . 6
Notes to Financial Statements
(unaudited) . . . . . . . . . . . . . . . . 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations . . . . . . . . . . . . . . . . 16
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K . . . . . . 22
Signature . . . . . . . . . . . . . . . . . . . . . . 23
<PAGE>3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
1995 1994
-------------- -------------
(Unaudited)
ASSETS
<S> <C> <C>
Investment in FHA-Insured Certificates
and GNMA Mortgage-Backed Securities,
at fair value:
Originated insured mortgages $ 56,826,284 $ 53,182,652
Acquired insured mortgages 40,563,719 36,919,453
-------------- -------------
97,390,003 90,102,105
Investment in FHA-Insured Loans, at
amortized cost, net of unamortized
premium and discount:
Originated insured mortgages 68,961,764 69,162,106
Acquired insured mortgage 998,118 1,000,856
-------------- -------------
69,959,882 70,162,962
Cash and cash equivalents 3,140,157 2,833,820
Investment in affiliate 478,612 478,612
Receivables and other assets 2,182,736 2,116,387
-------------- -------------
Total assets $ 173,151,390 $ 165,693,886
============== =============
LIABILITIES AND PARTNERS' EQUITY
Distributions payable $ 3,423,700 $ 3,423,700
Note payable and due to affiliate 495,962 478,612
Accounts payable and accrued expenses 119,093 200,987
-------------- -------------
Total liabilities 4,038,755 4,103,299
-------------- -------------
Partners' equity:
Limited partners' equity 175,679,206 175,790,599
General partner's deficit (833,494) (827,755)
Net unrealized losses on investment in
FHA-Insured Certificates and
GNMA Mortgage-Backed Securities (5,733,077) (13,372,257)
-------------- -------------
Total partners' equity 169,112,635 161,590,587
-------------- -------------
Total liabilities and
partners' equity $ 173,151,390 $ 165,693,886
============== =============
</TABLE>
The accompanying notes are an integral part
of these financial statements.
<PAGE>4
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For the three months ended For the six months ended
June 30, June 30,
---------------------------- -----------------------------
1995 1994 1995 1994
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Income:
Mortgage investment income $ 3,595,228 $ 3,388,294 $ 7,042,362 $ 6,499,667
Interest and other income 27,056 82,434 54,878 265,405
------------ ------------ ------------ ------------
3,622,284 3,470,728 7,097,240 6,765,072
------------ ------------ ------------ ------------
Expenses:
Asset management fee to
related parties 410,226 393,347 820,452 756,530
General and administrative 200,449 153,269 334,747 349,166
Interest expense to affiliate 8,675 34,754 17,350 69,509
------------ ------------ ------------ ------------
619,350 581,370 1,172,549 1,175,205
------------ ------------ ------------ ------------
Earnings before loan loss and gain
on mortgage disposition 3,002,934 2,889,358 5,924,691 5,589,867
Loan loss -- -- -- (115,301)
Gain on mortgage disposition -- -- -- 1,129,973
------------ ------------ ------------ ------------
Net earnings $ 3,002,934 $ 2,889,358 $ 5,924,691 $ 6,604,539
============ ============ ============ ============
Net earnings allocated to:
Limited partners - 95.1% $ 2,855,790 $ 2,747,780 $ 5,634,381 $ 6,280,917
General partner - 4.9% 147,144 141,578 290,310 323,622
------------ ------------ ------------ ------------
$ 3,002,934 $ 2,889,358 $ 5,924,691 $ 6,604,539
============ ============ ============ ============
Net earnings per Limited
Partnership Unit $ 0.30 $ 0.29 $ 0.59 $ 0.66
============ ============ ============ ============
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>5
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
STATEMENT OF CHANGES IN PARTNERS' EQUITY
For the six months ended June 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
Net
Unrealized
Losses on
Investment
in FHA-Insured
Certificates
and GNMA
General Limited Mortgage-Backed
Partner Partners Securities Total
------------- ------------- --------------- ------------
<S> <C> <C> <C> <C>
Balance, December 31, 1994 $ (827,755) $ 175,790,599 $ (13,372,257) $161,590,587
Net earnings 290,310 5,634,381 -- 5,924,691
Distributions paid or accrued of
of $0.60 per Unit (296,049 (5,745,774) -- (6,041,823)
Adjustment to net unrealized losses
on investment in FHA-Insured
Certificates and GNMA Mortgage-
Backed Securities -- -- 7,639,180 7,639,180
------------- ------------- --------------- ------------
Balance, June 30, 1995 $ (833,494) $ 175,679,206 $ (5,733,077) $169,112,635
============= ============= =============== ============
Limited Partnership Units outstanding -
June 30, 1995 9,576,290
=============
The accompanying notes are an integral part
of these financial statements.
</TABLE>
<PAGE>6
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the six months ended June 30,
1995 1994
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 5,924,691 $ 6,604,539
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Loan loss -- 115,301
Gain on mortgage disposition -- (1,129,973)
Changes in assets and liabilities:
Increase (decrease) in note payable and due to affiliate 17,350 (1,257,723)
Decrease in investment in and due from affiliate -- 1,250,087
Decrease in accounts payable and accrued expenses (81,894) (91,525)
(Increase) decrease in receivables and other assets (66,349) 1,215,112
------------ ------------
Net cash provided by operating activities 5,793,798 6,705,818
------------ ------------
Cash flows from investing activities:
Proceeds from disposition of Asset Held for Sale
under Coinsurance Program -- 33,233,501
Investment in Acquired Insured Mortgages -- (38,360,392)
Receipt of principal from scheduled payments 554,362 460,219
------------ ------------
Net cash provided by (used in) investing
activities 554,362 (4,666,672)
------------ ------------
Cash flows from financing activities:
Distributions paid to partners (6,041,823) (6,948,097)
------------ ------------
Net increase (decrease) in cash and cash equivalents 306,337 (4,908,951)
Cash and cash equivalents, beginning of period 2,833,820 9,095,255
------------ ------------
Cash and cash equivalents, end of period $ 3,140,157 $ 4,186,304
============ ============
</TABLE>
The accompanying notes are an integral part
of these financial statements.
<PAGE>7
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. ORGANIZATION
American Insured Mortgage Investors L.P. - Series 86 (the Partnership) was
formed under the Uniform Limited Partnership Act of the state of Delaware on
October 31, 1985. From inception through September 6, 1991, affiliates of
Integrated Resources, Inc. served as managing general partner (with a
partnership interest of 4.8%), corporate general partner (with a partnership
interest of 0.1%) and associate general partner (with a partnership interest of
0.1%). All of the foregoing general partners are sometimes collectively
referred to as former general partners.
Effective September 6, 1991, CRIIMI, Inc. (the General Partner) succeeded
the former general partners to become the sole general partner of the
Partnership. CRIIMI, Inc. is a wholly owned subsidiary of CRIIMI MAE Inc.
(CRIIMI MAE), formerly CRI Insured Mortgage Association, Inc. From inception
through June 30, 1995, CRIIMI MAE was managed by an adviser whose general
partner is C.R.I., Inc. (CRI). However, effective June 30, 1995, CRIIMI MAE
became a self-managed and self-administered real estate investment trust (REIT)
and, as a result, the adviser no longer advises CRIIMI MAE.
AIM Acquisition Partners L.P. (the Advisor) serves as the advisor of the
Partnership. The general partner of the Advisor is AIM Acquisition Corporation
and the limited partners include an affiliate of CRIIMI MAE (and through June
30, 1995, an affiliate of CRI). Effective September 6, 1991 and through June
30, 1995, a sub-advisory agreement (the Sub-advisory Agreement) existed whereby
CRI/AIM Management, Inc. (the Sub-advisor), an affiliate of CRI, managed the
Partnership's portfolio. In connection with the transaction in which CRIIMI MAE
became a self-managed and self-administered REIT, an affiliate of CRIIMI MAE
acquired the Sub-advisory Agreement. As a consequence of this transaction,
effective June 30, 1995, CRIIMI MAE Services Limited Partnership, an affiliate
of CRIIMI MAE, manages the Partnership's portfolio. These transactions had no
effect on the Partnership's financial statements.
Until the change in the Partnership's investment policy, as discussed
below, and through December 31, 1994 (the expiration of the Partnership's
reinvestment period), the Partnership was in the business of originating
mortgage loans (Originated Insured Mortgages) and acquiring mortgage loans
(Acquired Insured Mortgages, and together with Originated Insured Mortgages,
referred to herein as Insured Mortgages). After the expiration of the
reinvestment period, the Partnership is required (subject to the conditions set
forth in the Partnership Agreement) to distribute net proceeds from mortgage
dispositions to its Unitholders. The Partnership Agreement states that the
Partnership will terminate on December 31, 2020, unless previously terminated
under the provisions of the Partnership Agreement. As of June 30, 1995, the
Partnership had invested in either Originated Insured Mortgages which are
insured or guaranteed, in whole or in part, by the Federal Housing
Administration (FHA) or Acquired Insured Mortgages which are fully insured.
2. BASIS OF PRESENTATION
In the opinion of the General Partner, the accompanying unaudited financial
statements contain all adjustments of a normal recurring nature necessary to
present fairly the financial position of the Partnership as of June 30, 1995 and
December 31, 1994 and the results of its operations for the three and six months
ended June 30, 1995 and 1994 and its cash flows for the six months ended June
30, 1995 and 1994.
<PAGE>8
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
2. BASIS OF PRESENTATION - Continued
These unaudited financial statements have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission. Certain
information and note disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted. While the General Partner believes that the disclosures
presented are adequate to make the information not misleading, it is suggested
that these financial statements be read in conjunction with the financial
statements and the notes to the financial statements included in the
Partnership's Annual Report filed on Form 10-K for the year ended December 31,
1994.
3. SIGNIFICANT ACCOUNTING POLICIES
Statements of Cash Flows
------------------------
No cash payments were made for interest expense during the six months
ended June 30, 1995 and 1994.
4. INVESTMENT IN FHA-INSURED CERTIFICATES AND GNMA
MORTGAGE-BACKED SECURITIES
The following is a discussion of the Partnership's investment in FHA-
Insured Certificates and GNMA Mortgage-Backed Securities as of June 30, 1995 and
December 31, 1994:
Fully Insured GNMA Mortgage-Backed Securities
and FHA-Insured Certificates
----------------------------------------------
As of June 30, 1995 and December 31, 1994, the Partnership's
investment in fully-insured Acquired Insured Mortgages, carried at fair
value, consisted of ten GNMA Mortgage-Backed Securities and two FHA-Insured
Certificates with an aggregate amortized cost of $41,303,375 and
$41,472,892, respectively, an aggregate face value of $41,242,493 and
$41,411,005, respectively, and an aggregate fair value of $40,563,719 and
$36,919,453, respectively. As of August 11, 1995, all of the Acquired
Insured Mortgages, carried at fair value, were current with respect to
payment of principal and interest.
Originated Coinsured FHA-Insured Certificates
---------------------------------------------
As discussed in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 1994, under the HUD coinsurance program, both HUD
and the coinsurance lender are responsible for paying a portion of the
insurance benefits if a mortgagor defaults and the sale of the development
collateralizing the mortgage produces insufficient net proceeds to repay
the mortgage obligation. In such case, the coinsurance lender will be
liable to the Partnership for the first part of such loss in an amount up
to 5% of the outstanding principal balance of the mortgage as of the date
foreclosure proceedings are instituted or the deed is acquired in lieu of
foreclosure. For any loss greater than 5% of the outstanding principal
balance, the responsibility for paying the insurance benefits will be borne
on a pro-rata basis, 85% by HUD and 15% by the coinsurance lender.
1. Coinsured by third party
------------------------
As of June 30, 1995 and December 31, 1994, the Partnership held
<PAGE>9
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
4. INVESTMENT IN FHA-INSURED CERTIFICATES AND GNMA
MORTGAGE-BACKED SECURITIES - Continued
investments in seven FHA-Insured Certificates secured by coinsured
mortgages. These mortgage investments were originated by the former
managing general partner. As of June 30, 1995, two of the seven FHA-
Insured Certificates secured by coinsured mortgages are coinsured by
an unaffiliated third party coinsurance lender, The Patrician Mortgage
Company (Patrician), under the HUD coinsurance program. As of June
30, 1995, the two coinsured mortgages which are coinsured by Patrician
were delinquent with respect to the payment of principal and interest.
The General Partner is attempting to collect the delinquent payments
from Patrician.
The following is a discussion of actual and potential performance
problems with respect to the mortgage investments which are coinsured
by Patrician.
The Originated Insured Mortgages on The Villas and St. Charles Place -
Phase II are coinsured by Patrician. As of June 30, 1995 and December
31, 1994, the Partnership's investment in the mortgage on The Villas
had an amortized cost of $15,685,157 and $15,732,782, respectively, a
face value of $15,918,866 and $15,966,491, respectively, and a fair
value of $14,933,644 and $14,012,209, respectively. As of August 11,
1995, the mortgagor has made payments of principal and interest due on
the original mortgage through February 1995, and has made payments of
principal and interest due under a modification agreement through
August 1993. Patrician is currently litigating the case in bankruptcy
court seeking to acquire and ultimately dispose of the property.
The Partnership's investment in the mortgage on St. Charles Place-
Phase II had an amortized cost equal to its face value of $3,075,460
and $3,082,440 as of June 30, 1995 and December 31, 1994,
respectively. As of June 30, 1995 and December 31, 1994, this
mortgage had a fair value of $2,884,354 and $2,703,780,respectively.
These amounts represent the Partnership's approximate 45% ownership
interest in the mortgage. The remaining 55% ownership interest is
held by American Insured Mortgage Investors L.P. - Series 88 (AIM 88),
an affiliate of the Partnership. As of August 11, 1995, the mortgagor
has made payments of principal and interest due on the mortgage
through November 1994 to the Partnership. Patrician is currently
litigating the case in bankruptcy court in order to acquire and
ultimately dispose of the property.
The General Partner is monitoring Patrician's efforts to complete
these foreclosure actions, including the subsequent acquisition and
disposition of the above two properties. If the sale of the
properties collateralizing the mortgages produces insufficient net
proceeds to repay the mortgage obligations to the Partnership,
Patrician will be liable to the Partnership for the coinsurance
lender's share of the deficiency. Based on the General Partner's
assessment of the collateral underlying the mortgages, including
information related to the financial condition of Patrician, the
General Partner believes the carrying value of these assets is
realizable.
The General Partner intends to continue to oversee the Partnership's
interest in these mortgages to ensure that Patrician meets its
<PAGE>10
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
4. INVESTMENT IN FHA-INSURED CERTIFICATES AND GNMA
MORTGAGE-BACKED SECURITIES - Continued
coinsurance obligations. The General Partner's assessment of the
realizability of The Villas and St. Charles Place-Phase II mortgages
is based on current information, and to the extent current conditions
change or additional information becomes available, then the General
Partner's assessment may change. However, the General Partner does
not believe that there would be a material adverse impact on the
Partnership's financial condition or its results of operations should
Patrician be unable to comply with its full coinsurance obligation.
2. Coinsured by affiliate
----------------------
As of June 30, 1995 and December 31, 1994, the Partnership held
investments in five and two FHA-Insured Certificates secured by
coinsured mortgages, respectively, where the coinsurance lender is
Integrated Funding, Inc. (IFI), an affiliate of the Partnership. Two
of these mortgage investments were originated by the former managing
general partner. As structured by the former managing general
partner, with respect to these mortgages, the Partnership bears the
risk of loss upon default for IFI's portion of the coinsurance loss.
The Originated Insured Mortgages on Carmen Drive Estates, (The
Forest), Woodbine at Lakewood Apartments and Woodland Hills Apartments
were previously coinsured by M-West Mortgage Corporation (M-West), a
third party coinsurance lender. During the fourth quarter of 1994,
the Partnership was informed that M-West was liquidating its assets
and intended to assign the mortgage servicing rights related to these
mortgages to another coinsurance lender, Whitehall Funding, Inc.
(Whitehall). The Partnership successfully contested this transfer and
obtained a court order mandating the transfer of the mortgage
servicing rights related to these three coinsured loans to IFI. This
transfer was completed during the three months ended June 30, 1995.
The Partnership bears the risk of loss upon default for IFI's portion
of the coinsurance loss. As of June 30, 1995, receivables and other
assets, as shown on the accompanying balance sheet, includes
approximately $141,000 due from M-West with respect to these loans.
As of August 11, 1995, claims for damages against M-West and Whitehall
are still pending.
As of August 11, 1995, these five IFI coinsured mortgages, as shown in
the table below, were current with respect to the payment of principal
and interest, except for the mortgage on Spring Lake Village. As of
August 11, 1995, this coinsured mortgage is delinquent with respect to
the July 1995 principal and interest payment. The General Partner is
attempting to collect the delinquent payment.
The General Partner believes there is adequate collateral value
underlying these coinsured mortgages. Accordingly, no loan losses
were recognized on these mortgages during the three and six months
ended June 30, 1995 and 1994, except as described below in connection
with a mortgage modification during the six months ended June 30,
1994. As of June 30, 1995 and December 31, 1994, these five
investments had an aggregate fair value of $39,008,286 and
$36,466,663, respectively.
<PAGE>11
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
4. INVESTMENT IN FHA-INSURED CERTIFICATES AND GNMA
MORTGAGE-BACKED SECURITIES - Continued
<TABLE>
<CAPTION>
Amortized Face Amortized Face Loan Losses Recognized
Cost Value Cost Value for the six months ended
June 30, June 30, December 31, December 31, June 30, June 30,
1995 1995 1994 1994 1995 1994
------------ ------------ ------------ ------------ ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Pembrook Apartments $ 15,564,601 $ 14,956,654 $ 15,606,087 $ 14,992,832 $ -- $ --
Spring Lake Village 5,002,408 5,002,408 5,022,918 5,022,919 -- 115,301(a)
Carmen Drive Estates 4,979,737 4,888,268 4,992,884 4,900,599 -- --
Woodbine at Lakewood
Apartments 5,227,903 5,035,951 5,243,651 5,049,840 -- --
Woodland Hills Apartments 12,284,439 11,853,360 12,320,708 11,885,577 -- --
(a) In March 1994, the mortgage note was amended to reduce the mortgage interest rate from 8.75% to 7.00%. In connection
with the refinancing, the Partnership recognized a loan loss of $115,301 on the accompanying statement of operations for
the six months ended June 30, 1994, primarily representing the unamortized balance of acquisition and closing costs paid
in connection with the origination of this mortgage.
</TABLE>
In connection with the FHA-Insured Certificates secured by coinsured
mortgages, the Partnership has sought, in addition to base interest
payments, additional interest (commonly termed Participations) based
on a percentage of the net cash flow from the development and the net
proceeds from the refinancing, sale or other disposition of the
underlying development. All of the FHA-Insured Certificates secured
by coinsured mortgages contain such Participations. During the three
and six months ended June 30, 1995, the Partnership received
additional interest of $76,431 in connection with two of the
Participations. During the three and six months ended June 30, 1994,
the Partnership received additional interest of $7,628 in connection
with one of the Participations. These amounts are included in
mortgage investment income on the accompanying statements of
operations.
5. INVESTMENT IN FHA-INSURED LOANS
-------------------------------
The Partnership's investment in fully insured FHA-Insured Loans consisted
of eight Originated Insured Mortgages and one Acquired Insured Mortgage as of
June 30, 1995 and December 31, 1994. As of June 30, 1995 and December 31, 1994,
the Originated Insured Mortgages had an aggregate amortized cost of $68,961,764
and $69,162,106, respectively, an aggregate face value of $66,426,296 and
$66,602,806, respectively, and an aggregate fair value of $67,286,927 and
$63,422,100, respectively. As of June 30, 1995 and December 31, 1994, the
Acquired Insured Mortgage had an amortized cost of $998,118 and $1,000,856,
respectively, a face value of $1,001,581 and $1,004,351, respectively, and a
fair value of $1,014,577 and $956,403, respectively. As of August 11, 1995, the
Acquired Insured Mortgage and all of the Originated Insured Mortgages were
current with respect to payment of principal and interest.
In addition to base interest payments, the Partnership is entitled to
Participations on certain of the FHA-Insured Loans. During the three and six
<PAGE>12
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
5. INVESTMENT IN FHA-INSURED LOANS - Continued
months ended June 30, 1995, the Partnership received additional interest of
$38,574 and $73,357, respectively, from the Participations. During the three
and six months ended June 30, 1994, the Partnership received additional interest
of $33,432 from the Participations. These amounts are included in mortgage
investment income on the accompanying statements of operations.
6. DISTRIBUTIONS TO UNITHOLDERS
The distributions paid or accrued to Unitholders on a per Unit basis for
the three and six months ended June 30, 1995 and 1994 are as follows:
<PAGE>13
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
6. DISTRIBUTIONS TO UNITHOLDERS - Continued
1995 1994
---- ----
Quarter ended March 31, $ 0.26(1) $ 0.41(2)
Quarter ended June 30, 0.34(3) 0.29(4)
------ ------
$ 0.60 $ 0.70
====== ======
(1) This amount includes approximately $0.03 per Unit representing previously
undistributed accrued interest received from two delinquent mortgages.
(2) This amount includes approximately $0.18 per Unit representing previously
undistributed accrued interest received from the disposition of the
mortgage on One East Delaware and approximately $0.01 per Unit representing
previously undistributed accrued interest received from two delinquent
mortgages.
(3) This amount includes approximately $0.11 per Unit representing previously
undistributed accrued interest received from five delinquent mortgages, as
discussed in Note 4, above.
(4) This amount includes approximately $0.04 per Unit representing previously
undistributed accrued interest received from two delinquent mortgages.
The basis for paying distributions to Unitholders is net proceeds from
mortgage dispositions, if any, and cash flow from operations, which includes
regular interest income and principal from Insured Mortgages. Although Insured
Mortgages yield a fixed monthly mortgage payment once purchased, the cash
distributions paid to the Unitholders will vary during each quarter due to (1)
the fluctuating yields in the short-term money market where the monthly mortgage
payments received are temporarily invested prior to the payment of quarterly
distributions, (2) the reduction in the asset base and monthly mortgage payments
due to monthly mortgage payments received or mortgage dispositions, (3)
variations in the cash flow attributable to the delinquency or default of
Insured Mortgages and professional fees and foreclosure costs incurred in
connection with those Insured Mortgages and (4) variations in the Partnership's
operating expenses.
7. INVESTMENT IN AFFILIATE AND NOTE PAYABLE AND DUE TO
AFFILIATE
In April 1994, AIM 88 transferred a GNMA Mortgage-Backed Security in the
amount of approximately $2.0 million to IFI in order to recapitalize IFI with
sufficient net worth under HUD regulations. The Partnership and its affiliate,
American Insured Mortgage Investors - Series 85, L.P. (AIM 85), each issued a
demand note payable to AIM 88 and recorded an investment in IFI through an
affiliate, AIM Mortgage, Inc., in proportion to each entity's coinsured
mortgages for which IFI was the mortgagee of record as of April 1, 1994.
Interest expense on the note payable to AIM 88 is based on an annual interest
rate of 7.25%.
In connection with these transactions, the expense reimbursement agreement
was amended as of April 1, 1994 to adjust the allocation of the expense
reimbursement to the AIM Funds to an amount proportionate to each entity's
coinsured mortgage investments as of April 1, 1994. The expense reimbursement,
<PAGE>14
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
7. INVESTMENT IN AFFILIATE AND NOTE AND DUE PAYABLE TO
AFFILIATE - Continued
as amended, along with the Partnership's equity interest in IFI's net income or
loss, substantially equals the Partnership's interest expense on the note
payable.
8. TRANSACTIONS WITH RELATED PARTIES
In addition to the related party transactions described above in Note 7,
the General Partner and certain affiliated entities, during the three and six
months ended June 30, 1995 and 1994, earned or received compensation or payments
for services from the Partnership as follows:
<PAGE>15
AMERICAN INSURED MORTGAGE INVESTORS L.P. - SERIES 86
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
8. TRANSACTIONS WITH RELATED PARTIES - Continued
<TABLE>
<CAPTION>
COMPENSATION PAID OR ACCRUED TO RELATED PARTIES
----------------------------------------------
For the three months For the six months
Capacity in Which ended June 30, ended June 30,
Name of Recipient Served/Item 1995 1994 1995 1994
----------------- ---------------------------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
CRIIMI, Inc. General Partner/Distribution $167,761 $143,091 $296,049 $345,391
AIM Acquisition Advisor/Asset Management Fee 410,226 393,347 820,452 756,530
Partners, L.P. (1)
CRI(2) Affiliate of General Partner/
Expense Reimbursement 30,936 40,184 50,568 105,093
(1) Of the amounts paid to the Advisor, the Sub-advisor earned a fee equal to $120,900 and $115,928, or .28% of Total Invested
Assets, for the three months ended June 30, 1995 and 1994, respectively. The Sub-advisor earned a fee equal to $241,800 and
$222,965, or .28% of Total Invested Assets, for the six months ended June 30, 1995 and 1994, respectively. As discussed in Note 1
above, through June 30, 1995, CRI/AIM Management, Inc. served as the Sub-advisor to the Partnership. Effective June 30, 1995,
CRIIMI MAE Services Limited Partnership will serve as the Sub-advisor. No amounts were paid to CRIIMI MAE Services Limited
Partnership during the six months ended June 30, 1995.
(2) Prior to June 30, 1995 these amounts were paid to CRI as reimbursement for expenses incurred on behalf of the General
Partner and the Partnership. The transaction in which CRIIMI MAE became a self-managed and self-administered REIT, discussed in
Note 1 above, has no impact on the payments required to be made by the Partnership, other than the expense reimbursement previously
paid by the Partnership to CRI in connection with the provision of services by the Sub-advisor will be paid to a wholly owned
subsidiary of CRIIMI MAE, which is the General Partner of CRIIMI MAE Services Limited Partnership, effective June 30, 1995. No
amounts were paid to CRIIMI MAE or its affiliates during the six months ended June 30, 1995.
</TABLE>
<PAGE>16
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
-------
As of June 30, 1995, the Partnership had invested in 28 Insured Mortgages,
with an aggregate amortized cost of approximately $173 million, an aggregate
face value of approximately $169 million and an aggregate fair value of
approximately $166 million, as discussed below.
Results of Operations
---------------------
Net earnings increased for the three months ended June 30, 1995 as compared
to the corresponding period in 1994 primarily due to an increase in mortgage
investment income, as discussed below. Net earnings decreased for the six
months ended June 30, 1995 as compared to the corresponding period in 1994
primarily due to the gain recognized on the disposition of the Insured Mortgage
on One East Delaware in January 1994. Partially offsetting this decrease was an
increase in mortgage investment income, as discussed below.
Mortgage investment income increased for the three and six months ended
June 30, 1995 as compared to the corresponding periods in 1994 due to an
increase in total invested assets during the three and six months ended June 30,
1995, as compared to the corresponding periods in 1994. The increase in total
invested assets is attributable to the reinvestment of net proceeds from the
disposition of the Insured Mortgages on One East Delaware and Victoria Pointe
Apartments-Phase II, which were received in December 1993 and January 1994.
Interest and other income decreased for the three and six months ended June
30, 1995 as compared to the corresponding periods in 1994 primarily due to the
short-term investment in 1994 of net disposition proceeds prior to reinvestment
in Acquired Insured Mortgages, as previously discussed.
Asset management fees increased for the three and six months ended June 30,
1995 as compared to the corresponding periods in 1994 as a result of the
increase in total invested assets, as discussed above.
General and administrative expenses increased for the three months ended
June 30, 1995 as compared to the corresponding period in 1994 primarily due to
an increase in legal and professional fees related to litigation involving the
transfer of mortgage servicing rights related to three coinsured loans, as
discussed below. Partially offsetting this increase was a decrease in payroll
and related expenses incurred in connection with the mortgage dispositions,
mortgage acquisitions and mortgages with performance problems, as a result of
the stabilization of the mortgage portfolio during 1994. General and
administrative expenses decreased for the six months ended June 30, 1995 as
compared to the corresponding period in 1994. This decrease was due primarily
to a decrease in payroll and related expenses incurred in connection with the
mortgage dispositions, mortgage acquisitions, and mortgages with performance
problems, as a result of the stabilization of the mortgage portfolio during
1994. Also contributing to the decrease was the payment in 1994 of a one-time
fee in connection with the listing of the Partnership's units on the American
Stock Exchange. Partially offsetting these decreases was an increase in legal
and professional fees incurred during 1995 arising from the litigation involving
the transfer of the mortgage servicing rights related to three coinsured loans,
as discussed below.
Interest expense to affiliate decreased for the three and six months ended
June 30, 1995 as compared to the corresponding periods in 1994 as a result of
the paydown of the note payable to AIM 85 during 1994, partially offset by the
execution of a note payable to AIM 88. The note payable to AIM 88 is in the
<PAGE>17
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS -
Continued
approximate amount of $479,000, at an annual interest rate of 7.25%, as compared
to the note payable to AIM 85 of approximately $1.7 million at an annual
interest rate of 8%. The reduction in the principal amount of the notes
reflects the reduction in the Partnership's coinsured loans since the initial
capitalization of IFI in 1991.
Gain on mortgage disposition and loan loss decreased for the six months
ended June 30, 1995 as compared to the corresponding period in 1994. Gains and
losses on mortgage dispositions are based on the number, carrying amounts and
proceeds of mortgage investments disposed of during the period. During the six
months ended June 30, 1994, the Partnership disposed of the mortgage on One East
Delaware and recognized a gain of approximately $1.1 million. Additionally,
during the first quarter of 1994, the mortgage on Spring Lake Village was
modified, resulting in the recognition of a loan loss of approximately $115,000.
No mortgage investments were disposed of or modified during the six months ended
June 30, 1995.
INVESTMENT IN FHA-INSURED CERTIFICATES AND GNMA MORTGAGE-
BACKED SECURITIES
---------------------------------------------------------
The following is a discussion of the Partnership's investment in FHA-
Insured Certificates and GNMA Mortgage-Backed Securities as of June 30, 1995 and
December 31, 1994:
Fully Insured GNMA Mortgage-Backed Securities
and FHA-Insured Certificates
----------------------------------------------
As of June 30, 1995 and December 31, 1994, the Partnership's
investment in fully-insured Acquired Insured Mortgages, carried at fair
value, consisted of ten GNMA Mortgage-Backed Securities and two FHA-Insured
Certificates with an aggregate amortized cost of $41,303,375 and
$41,472,892 respectively, an aggregate face value of $41,242,493 and
$41,411,005, respectively, and an aggregate fair value of $40,563,719 and
$36,919,453, respectively. As of August 11, 1995, all of the Acquired
Insured Mortgages carried at fair value, were current with respect to
payment of principal and interest.
Originated Coinsured FHA-Insured Certificates
---------------------------------------------
As discussed in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 1994, under the HUD coinsurance program, both HUD
and the coinsurance lender are responsible for paying a portion of the
insurance benefits if a mortgagor defaults and the sale of the development
collateralizing the mortgage produces insufficient net proceeds to repay
the mortgage obligation. In such case, the coinsurance lender will be
liable to the Partnership for the first part of such loss in an amount up
to 5% of the outstanding principal balance of the mortgage as of the date
foreclosure proceedings are instituted or the deed is acquired in lieu of
foreclosure. For any loss greater than 5% of the outstanding principal
balance, the responsibility for paying the insurance benefits will be borne
on a pro-rata basis, 85% by HUD and 15% by the coinsurance lender.
1. Coinsured by third party
------------------------
As of June 30, 1995 and December 31, 1994, the Partnership held
investments in seven FHA-Insured Certificates secured by coinsured
mortgages. These mortgage investments were originated by the former
<PAGE>18
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS -
Continued
managing general partner. As of June 30, 1995, two of the seven FHA-
Insured Certificates secured by coinsured mortgages are coinsured by
an unaffiliated third party coinsurance lender, The Patrician Mortgage
Company (Patrician), under the HUD coinsurance program. As of June
30, 1995, the two coinsured mortgages which are coinsured by Patrician
were delinquent with respect to the payment of principal and interest.
The General Partner is attempting to collect the delinquent payments
from Patrician.
The following is a discussion of actual and potential performance
problems with respect to the mortgage investments which are coinsured
by Patrician.
The Originated Insured Mortgages on The Villas and St. Charles Place -
Phase II are coinsured by Patrician. As of June 30, 1995 and December
31, 1994, the Partnership's investment in the mortgage on The Villas
had an amortized cost of $15,685,157 and $15,732,782, respectively, a
face value of $15,918,866 and $15,966,491, respectively, and a fair
value of $14,933,644 and $14,012,209, respectively. As of August 11,
1995, the mortgagor has made payments of principal and interest due on
the original mortgage through February 1995, and has made payments of
principal and interest due under a modification agreement through
August 1993. Patrician is currently litigating the case in bankruptcy
court seeking to acquire and ultimately dispose of the property.
The Partnership's investment in the mortgage on St. Charles Place-
Phase II had an amortized cost equal to its face value of $3,075,460
and $3,082,440 as of June 30, 1995 and December 31, 1994,
respectively. As of June 30, 1995 and December 31, 1994, this
mortgage had a fair value of $2,884,354 and $2,703,780, respectively.
These amounts represent the Partnership's approximate 45% ownership
interest in the mortgage. The remaining 55% ownership interest is
held by AIM 88, an affiliate of the Partnership. As of August 11,
1995, the mortgagor has made payments of principal and interest due on
the mortgage through November 1994 to the Partnership. Patrician is
currently litigating the case in bankruptcy court in order to acquire
and ultimately dispose of the property.
The General Partner is monitoring Patrician's efforts to complete
these foreclosure actions, including the subsequent acquisition and
disposition of the above two properties. If the sale of the
properties collateralizing the mortgages produces insufficient net
proceeds to repay the mortgage obligations to the Partnership,
Patrician will be liable to the Partnership for the coinsurance
lender's share of the deficiency. Based on the General Partner's
assessment of the collateral underlying the mortgages, including
information related to the financial condition of Patrician, the
General Partner believes the carrying value of these assets is
realizable.
The General Partner intends to continue to oversee the Partnership's
interest in these mortgages to ensure that Patrician meets its
coinsurance obligations. The General Partner's assessment of the
realizability of The Villas and St. Charles Place-Phase II mortgages
is based on current information, and to the extent current conditions
change or additional information becomes available, then the General
Partner's assessment may change. However, the General Partner does
not believe that there would be a material adverse impact on the
<PAGE>19
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS -
Continued
Partnership's financial condition or its results of operations should
Patrician be unable to comply with its full coinsurance obligation.
2. Coinsured by affiliate
----------------------
As of June 30, 1995 and December 31, 1994, the Partnership held
investments in five and two FHA-Insured Certificates secured by
coinsured mortgages, respectively, where the coinsurance lender is
IFI, an affiliate of the Partnership. Two of these mortgage
investments were originated by the former managing general partner.
As structured by the former managing general partner, with respect to
these mortgages, the Partnership bears the risk of loss upon default
for IFI's portion of the coinsurance loss.
The Originated Insured Mortgages on Carmen Drive Estates, (The
Forest), Woodbine at Lakewood Apartments and Woodland Hills Apartments
were previously coinsured by M-West Mortgage Corporation (M-West), a
third party coinsurance lender. During the fourth quarter of 1994,
the Partnership was informed that M-West was liquidating its assets
and intended to assign the mortgage servicing rights related to these
mortgages to another coinsurance lender, Whitehall Funding, Inc.
(Whitehall). The Partnership successfully contested this transfer and
obtained a court order mandating the transfer of the mortgage
servicing rights related to these three coinsured loans to IFI. This
transfer was completed during the three months ended June 30, 1995.
The Partnership bears the risk of loss upon default for IFI's portion
of the coinsurance loss. As of June 30, 1995, receivables and other
assets, as shown on the accompanying balance sheet, includes
approximately $141,000 due from M-West with respect to these loans.
As of August 11, 1995, claims for damages against M-West and Whitehall
are still pending.
As of August 11, 1995, these five IFI coinsured mortgages, as shown in
the table below, were current with respect to the payment of principal
and interest, except for the mortgage on Spring Lake Village, which is
delinquent with respect to the July 1995 principal and interest
payment. The General Partner is currently working with the mortgagor
of the mortgage on Spring Lake Village to collect the delinquent
payment.
The General Partner believes there is adequate collateral value
underlying these coinsured mortgages. Accordingly, no loan losses
were recognized on these mortgages during the three and six months
ended June 30, 1995 and 1994, except as described below in connection
with a mortgage modification during the six months ended June 30,
1994. As of June 30, 1995 and December 31, 1994, these five
investments had an aggregate fair value of $39,008,286 and
$36,466,663, respectively.
<PAGE>20
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS -
Continued
<TABLE>
<CAPTION>
Amortized Face Amortized Face Loan Losses Recognized
Cost Value Cost Value for the six months ended
June 30, June 30, December 31, December 31, June 30, June 30,
1995 1995 1994 1994 1995 1994
------------ ------------ ------------ ------------ ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Pembrook Apartments $ 15,564,601 $ 14,956,654 $ 15,606,087 $ 14,992,832 $ -- $ --
Spring Lake Village 5,002,408 5,002,408 5,022,918 5,022,919 -- 115,301(a)
Carmen Drive Estates 4,979,737 4,888,268 4,992,884 4,900,599 -- --
Woodbine at Lakewood
Apartments 5,227,903 5,035,951 5,243,651 5,049,840 -- --
Woodland Hills Apartments 12,284,439 11,853,360 12,320,708 11,885,577 -- --
(a) In March 1994, the mortgage note was amended to reduce the mortgage interest rate from 8.75% to 7.00%. In connection
with the refinancing, the Partnership recognized a loan loss of $115,301 on the accompanying statement of operations for
the six months ended June 30, 1994, primarily representing the unamortized balance of acquisition and closing costs paid
in connection with the origination of this mortgage.
</TABLE>
In connection with the FHA-Insured Certificates secured by coinsured
mortgages the Partnership has sought, in addition to base interest
payments, additional interest (commonly termed Participations) based
on a percentage of the net cash flow from the development and the net
proceeds from the refinancing, sale or other disposition of the
underlying development. All of the FHA-Insured Certificates secured
by coinsured mortgages contain such Participations. During the three
and six months ended June 30, 1995, the Partnership received
additional interest of $76,431 in connection with two of the
Participations. During the three and six months ended June 30, 1994,
the Partnership received additional interest of $7,628 in connection
with one of the Participations. These amounts are included in
mortgage investment income on the accompanying statements of
operations.
INVESTMENT IN FHA-INSURED LOANS
-------------------------------
The Partnership's investment in fully insured FHA-Insured Loans consisted
of eight Originated Insured Mortgages and one Acquired Insured Mortgage as of
June 30, 1995 and December 31, 1994. As of June 30, 1995 and December 31, 1994,
the Originated Insured Mortgages had an aggregate amortized cost of $68,961,764
and $69,162,106, respectively, an aggregate face value of $66,426,296 and
$66,602,806, respectively, and an aggregate fair value of $67,286,927 and
$63,422,100, respectively. As of June 30, 1995 and December 31, 1994, the
Acquired Insured Mortgage had an amortized cost of $998,118 and $1,000,856,
respectively, a face value of $1,001,581 and $1,004,351, respectively, and a
fair value of $1,014,577 and $956,403, respectively.
As of August 11, 1995 the Acquired Insured Mortgage and all of the
Originated Insured Mortgages were current with respect to payment of principal
and interest.
In addition to base interest payments, the Partnership is entitled to
Participations on certain of the FHA-Insured Loans. During the three and six
months ended June 30, 1995, the Partnership received additional interest of
$38,574 and $73,357, respectively, from the Participations. During the three
<PAGE>21
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS -
Continued
and six months ended June 30, 1994, the Partnership received additional interest
of $33,432 from the Participations. These amounts are included on mortgage
investment income on the accompanying statements of operations.
Liquidity and Capital Resources
-------------------------------
The Partnership's operating cash receipts, derived from payments of
principal and interest on Insured Mortgages, plus cash receipts from interest on
short-term investments, were sufficient during the first six months of 1995 to
meet operating requirements.
The basis for paying distributions to Unitholders is net proceeds from
mortgage dispositions, if any, and cash flow from operations, which includes
regular interest income and principal from Insured Mortgages. Although Insured
Mortgages yield a fixed monthly mortgage payment once purchased, the cash
distributions paid to the Unitholders will vary during each quarter due to (1)
the fluctuating yields in the short-term money market where the monthly mortgage
payments received are temporarily invested prior to the payment of quarterly
distributions, (2) the reduction in the asset base and monthly mortgage payments
due to monthly mortgage payments received or mortgage dispositions, (3)
variations in the cash flow attributable to the delinquency or default of
Insured Mortgages and professional fees and foreclosure costs incurred in
connection with those Insured Mortgages and (4) variations in the Partnership's
operating expenses.
Net cash provided by operating activities decreased for the six months
ended June 30, 1995 as compared to the corresponding period in 1994. This
decrease was primarily due to a decrease in receivables and other assets during
the six months ended June 30, 1994 as a result of the receipt in January 1994 of
the remaining net disposition proceeds related to the disposition of the
mortgage on Victoria Pointe Apartments - Phase II and receipt of accrued
interest related to the mortgage on One East Delaware.
Net cash provided by investing activities increased for the six months
ended June 30, 1995 as compared to the corresponding period in 1994, primarily
due to the investment in 1994 of approximately $38.4 million in Acquired Insured
Mortgages, which was partially offset by the receipt in 1994 of net disposition
proceeds of approximately $33.2 million from the disposition of the Insured
Mortgage on One East Delaware. No dispositions or acquisitions occurred during
the six months ended June 30, 1995.
Net cash used in financing activities decreased for the six months ended
June 30, 1995 as compared to the corresponding period in 1994. This decrease
was primarily due to the 1994 distribution of accrued, but previously
undistributed, interest from the disposition of the mortgage on One East
Delaware.
<PAGE>22
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
No reports on Form 8-K were filed with the Securities and Exchange
Commission during the quarter ended June 30, 1995.
The exhibits filed as part of this report are listed below:
Exhibit No. Description
---------- -----------
27 Financial Data Schedule
<PAGE>23
SIGNATURE
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.
AMERICAN INSURED MORTGAGE
INVESTORS L.P. - SERIES 86
(Registrant)
By: CRIIMI, Inc.
General Partner
August 11, 1995 /s/ Cynthia O. Azzara
--------------------------- -------------------------
DATE Cynthia O. Azzara
Principal Financial and
Accounting Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE SECOND QUARTER 10-Q AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
<CASH> 3,140
<SECURITIES> 97,390
<RECEIVABLES> 72,143
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 173,151
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 169,113
<TOTAL-LIABILITY-AND-EQUITY> 173,151
<SALES> 0
<TOTAL-REVENUES> 7,097
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,172
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 5,925
<INCOME-TAX> 0
<INCOME-CONTINUING> 5,925
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,925
<EPS-PRIMARY> .59
<EPS-DILUTED> 0
</TABLE>
