6
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 July 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 ________.
Commission File Number: 0-18146
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
(Exact name of registrant as specified in governing instrument)
Delaware 13-3293754
(State of organization) (IRS Employer
Identification No.)
2 World Trade Center, New York, NY 10048
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212)
392-1054
Former name, former address and former fiscal year, if changed
since last report: not applicable
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
Page 1
<TABLE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED BALANCE SHEETS
<CAPTION>
July 31, October 31,
1997 1996
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 3,181,096 $
2,380,612
Real estate:
Land 11,263,904
11,263,904
Buildings and improvements 90,882,440
90,921,733
102,146,344
102,185,637
Accumulated depreciation 27,149,123
25,226,740
74,997,221
76,958,897
Investments in joint ventures 24,366,211
41,727,417
Deferred leasing commissions, net 841,542
938,381
Other assets 1,730,668
2,773,195
$105,116,738
$124,778,502
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable and accrued liabilities $ 624,203 $
615,102
Security deposits 153,695
155,356
777,898
770,458
Partners' capital (deficiency):
General partners (8,317,487)
(7,942,412)
Limited partners ($500 per Unit, 534,020 Units issued)
112,656,327 131,950,456
Total partners' capital 104,338,840
124,008,044
$105,116,738
$124,778,502
See accompanying notes to consolidated financial statements
</TABLE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three and nine months ended July 31, 1997 and 1996
<CAPTION>
Three months ended Nine
months ended
July 31, July 31,
1997 1996 1997 1996
<S> <C> <C> <C>
<C>
Revenues:
Rental $2,644,590 $2,760,079 $
8,155,685 $ 8,901,713
Equity in earnings of joint ventures 638,392
894,363 3,047,319 2,608,030
Interest 27,409 31,243
223,860 639,136
Other 25,481 37,237
66,418 112,337
3,335,872 3,722,922
11,493,282 12,261,216
Expenses:
Property operating 852,367 1,086,496
2,593,627 3,461,969
Depreciation 857,060 751,319
2,388,219 2,314,016
Amortization 82,410 71,788
237,571 205,922
General and administrative 241,860 222,637
758,408 726,861
Loss on impairment of real estate - - -
12,422,872
2,033,697 2,132,240
5,977,825 19,131,640
Net income (loss) $1,302,175 $1,590,682 $
5,515,457 $(6,870,424)
Net income (loss) allocated to:
Limited partners $1,171,957 $1,431,614 $
5,056,867 $(6,183,382)
General partners 130,218 159,068
458,590 (687,042)
$1,302,175 $1,590,682 $
5,515,457 $(6,870,424)
Net income (loss) per Unit of
limited partnership interest $ 2.19 $ 2.68
$ 9.47 $ (11.58)
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL
Nine months ended July 31, 1997
<CAPTION>
Limited General
Partners Partners Total
<S> <C> <C>
<C>
Partners' capital (deficiency)
at November 1, 1996 $131,950,456
$(7,942,412) $124,008,044
Net income 5,056,867
458,590 5,515,457
Cash distributions (24,350,996)
(833,665) (25,184,661)
Partners' capital (deficiency)
at July 31, 1997 $112,656,327
$(8,317,487) $104,338,840
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended July 31, 1997 and 1996
<CAPTION>
1997 1996
<S> <C>
<C>
Cash flows from operating activities:
Net income (loss) $ 5,515,457 $
(6,870,424)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation 2,388,219
2,314,016
Amortization 237,571
205,922
Equity in earnings of joint ventures (3,047,319)
(2,608,030)
Loss on impairment of real estate -
12,422,872
(Increase) decrease in operating assets:
Deferred expenses (140,731)
(239,378)
Other assets 1,042,527
734,081
Increase (decrease) in operating liabilities:
Accounts payable and accrued liabilities
9,101 392,017
Security deposits (1,661)
10,431
Net cash provided by operating activities
6,003,164 6,361,507
Cash flows from investing activities:
Additions to real estate (426,544)
(758,761)
Investments in joint ventures (524,264)
(567,845)
Distributions from joint ventures 20,932,789
3,999,048
Proceeds from disposition of real estate held for sale
- - 35,256,585
Net cash provided by investing activities
19,981,981 37,929,027
Cash flows from financing activities:
Cash distributions (25,184,661)
(45,382,800)
Increase (decrease) in cash and cash equivalents
800,484 (1,092,266)
Cash and cash equivalents at beginning of period
2,380,612 4,687,564
Cash and cash equivalents at end of period $ 3,181,096 $
3,595,298
(Continued)
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended July 31, 1997 and 1996
(Continued)
<CAPTION>
1997 1996
<S> <C>
<C>
Supplemental disclosure of non-cash investing activities:
Reclassification of real state held for sale:
Increase to real estate:
Land $
1,023,904
Buildings and improvements
9,215,139
Decrease to real estate held for sale $
10,239,043
See accompanying notes to consolidated financial
statements.
</TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Notes to Consolidated Financial Statements
1. The Partnership
Dean Witter Realty Income Partnership III, L.P. (the
"Partnership") is a limited partnership organized under
the laws of the State of Delaware in 1985. The
Partnership's fiscal year ends on October 31.
The financial statements include the accounts of the
Partnership, Part Six Associates and Laurel-Vincent
Place Associates Limited Partnership on a consolidated
basis. The Partnership's interests in Taxter Corporate
park, Tech Park Reston and the partnership which owns
interests in Chesterbrook Corporate Center are
accounted for on the equity method.
The Partnership's records are maintained on the accrual
basis of accounting for financial reporting and tax
reporting purposes.
Net income (loss) per Unit of limited partnership
interest amounts are calculated by dividing net income
(loss) allocated to Limited Partners, in accordance
with the Partnership Agreement, by the weighted average
number of Units outstanding.
In the opinion of management, the accompanying
financial statements, which have not been audited,
include all adjustments necessary to present fairly the
results for the interim period. Except for the losses
on impairment of certain real estate in the first
quarter of fiscal 1996 and the gain on the sale of the
Tech Park Reston property included in equity in
earnings of joint ventures in the first quarter of
fiscal 1997, such adjustments consist only of normal
recurring accruals.
These financial statements should be read in
conjunction with the annual financial statements and
notes thereto included in the Partnership's annual
report on Form 10-K filed with the Securities and
Exchange Commission for the year ended October 31,
1996. Operating results of interim periods may not be
indicative of the operating results for the entire
year.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Notes to Consolidated Financial Statements
2. Real Estate
On December 31, 1996, Technology Park Associates (which
is owned 35% by the Partnership and 65% by Dean Witter
Realty Income Partnership IV, L.P., an affiliated
public partnership), and DW Technology Park II
Associates, L.P. (which is owned by affiliates of the
General Partner) sold the Technology Park Reston office
park (the "Property") to Sprint Communications Company
L.P., the sole tenant at the Property, for a negotiated
sales price of $76.3 million. $51,483,000 of the sales
price was allocated to Technology Park Associates and
$24,817,000 was allocated to DW Technology Park II
Associates, L.P., based on the relative square footage
of the buildings each owned at the Property. The
purchase price was received in cash at closing. The
Partnership received approximately $17.7 million of
such cash, representing its 35% share of the cash
received by Technology Park Associates, net of closing
costs. The Partnership's share ($930,000) of
Technology Park Associates' gain on the sale is
included in equity in earnings of joint ventures. The
Partnership made a distribution of a portion of the net
proceeds from the sale ($31.55 per Unit) to Limited
Partners in February 1997 representing a return of
capital.
In connection with a new lease at Westland Crossing,
the Partnership committed to demolish approximately
20,000 square feet of existing tenant space and to
construct an additional 7,000 square feet of new space
for a PetsMart store at a cost of approximately $1.7
million. Construction is currently underway and is
expected to be completed during fiscal 1998. The
Partnership anticipates funding the construction costs
from cash reserves and proceeds from future property
sales.
3. Related Party Transactions
An affiliate of the Managing General Partner provided
property management services for five properties (eight
properties in 1996) as well as for five buildings at
the Chesterbrook Corporate Center. The Partnership
incurred management fees of approximately $190,000 and
$229,000 for the nine months ended July 31, 1997 and
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Notes to Consolidated Financial Statements
1996, respectively. These amounts are included in
property operating expenses.
Another affiliate of the Managing General partner
performs administrative functions, processes investor
transactions and prepares tax information for the
Partnership. For the nine months ended July 31, 1997
and 1996, the Partnership incurred approximately
$476,000 and $507,000, respectively, for these
services. These amounts are included in general and
administrative expenses.
As of July 31, 1997, the affiliates were owed a total
of approximately $71,600 for these services.
4. Litigation
Various public partnerships sponsored by Dean Witter
Realty Inc. (including the Partnership and its Managing
General Partner) are defendants in purported class
actions lawsuits pending in state and federal courts.
The complaints allege a number of claims, including
breach of fiduciary duty, fraud and misrepresentation,
and seek an accounting of profits, compensatory and
other damages in an unspecified amount, possible
liquidation of the Partnership under a receiver's
supervision and other equitable relief. The defendants
are vigorously defending these actions. It is
impossible to predict the effect, if any, the outcome
of these actions might have on the Partnership's
financial statements.
5. Subsequent Distribution
On August 27, 1997, the Partnership paid the third
quarter cash distribution of approximately $4.35 per
Unit to the Limited Partners. The total cash
distribution amounted to $2,581,097, with $2,322,987
distributed to the Limited Partners and $258,110
to the General Partners.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Liquidity and Capital Resources
The Partnership raised $267,010,000 in a public
offering of 534,020 Units which was terminated in 1987.
The Partnership has no plans to raise additional
capital.
The Partnership purchased, directly or through a
partnership interest six office properties and five
retail properties. Through July 31, 1997, one office
and three retail properties have been sold. The
Partnership's acquisition program has been completed.
No additional investments are planned.
Most property types, except for retail, experienced
steady demand, declining vacancies and increasing
rents. Strong job growth, especially in the business
services and technology industries, led to strong
performance in the office and office/research and
development real estate sector. Vacancies in many
office markets are in the single digits and rents have
risen to levels that support new construction.
Favorable market fundamentals resulted in value
appreciation as investors bid for office properties.
Business Park at Holcomb Woods, Glenhardie Corporate
Center III & IV and Chesterbrook Corporate Center are
located in improved office markets. The Partnership
is, therefore, currently marketing the Business Park at
Holcomb Woods property for sale and plans to market the
Glenhardie and Chesterbrook properties for sale in the
fourth quarter of fiscal 1997. The Partnership's
remaining office property, Taxter Corporate Park, is
located in Westchester, New York where the vacancy
level for office properties is approximately 19%. As
this market continues to improve, the Partnership plans
to market the Taxter property for sale during 1998.
Overbuilding and retailer failures continued to pose a
challenge for many retail properties and there is still
an oversupply in many markets. Rental rates for retail
space were stagnant in 1996 and are not expected to
rise significantly in 1997. Many retail property
owners are investing additional capital to improve
their centers in order to differentiate them and
maintain a high occupancy level. At Westland Crossing,
construction of a 26,800 square foot anchor store is
proceeding and is expected to be
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
completed during fiscal 1998. The Partnership is also
considering various plans to re-develop Laurel Lakes
Centre.
The closing of the sale of the Technology Park Reston
office park occurred on December 31, 1996 (see note 2
to the consolidated financial statements). During the
three- and nine-month periods ended July 31, 1997, the
Partnership's aggregate cash flow from operations
decreased compared to 1996 by $409,500 and $955,500,
respectively, as a result of the sale of the property.
The Partnership's operating cash flow from this joint
venture was approximately $1,600,000 in 1996 and
$273,000 during the three- and nine-months ended July
31, 1997.
As a result of the sale of the Partnership's
properties, the quarterly distribution rate was
adjusted to $4.35 per Unit, representing an annual
return of approximately 4.75% on the gross offering
proceeds attributable to the Partnership's remaining
investments, beginning with the May 1997 distribution.
The Partnership's liquidity depends upon cash flow from
operations of its properties and expenditures for
building improvements and tenant improvements and
leasing commissions in connection with the leasing of
space. During the three- and nine-month periods ended
July 31, 1997, all of the Partnership's properties and
joint venture interests generated positive cash flow
from operations, and the Partnership anticipates that
they will continue to do so in fiscal 1997.
In addition, the Partnership's liquidity has been and
will continue to be affected by the sale of other
properties. As the Partnership has fewer income-
producing investments, Partnership cash from operations
will decline, as will Partnership distributions. The
Partnership will also require less cash reserves to
fund capital expenditures and leasing commissions.
During the nine months ended July 31, 1997, the
Partnership's cash flow from operations and
distributions received from its joint ventures exceeded
distributions to investors, capital expenditures,
leasing commissions and contributions to its joint
ventures.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
During the nine months ended July 31, 1997, the
Partnership incurred approximately $567,000 of tenant
improvements and leasing commissions primarily at the
Glenhardie ($198,000) and Holcomb Woods ($354,000)
properties. The Partnership also contributed,
primarily to the Chesterbrook joint venture,
approximately $524,000 for its share of capital
expenditures.
As of July 31, 1997, the Partnership has commitments to
fund approximately $353,000 of tenant improvements and
leasing commissions and to contribute approximately
$316,000 for its share of capital expenditures and
leasing commissions primarily at the Chesterbrook joint
ventures.
In connection with a new lease at Westland Crossing,
the Partnership committed to demolish approximately
20,000 square feet of existing tenant space and to
construct an additional 7,000 square feet of new space
for a PetsMart store at a cost of approximately $1.7
million. Construction is proceeding and is expected to
be completed during 1998. The Partnership anticipates
funding the construction costs from cash reserves and
proceeds from future property sales.
The Partnership may incur material capital expenditures
to lease vacant space at the Laurel Lakes Centre
shopping center. The amount of such expenditures is
uncertain at this time. To the extent that the vacant
space at the property is not re-leased, the
Partnership's cash flow will be reduced.
During the remainder of 1997, the Partnership expects
that its cash flow from operations and distributions
received from its joint ventures will exceed
distributions to its investors (other than
distributions of net proceeds from property sales). As
discussed above, the Partnership expects to fund a
portion of capital expenditures, leasing commissions
and contributions to its joint ventures from cash
reserves and proceeds from future property sales in
1997.
Except as discussed herein and in the consolidated
financial statements, the Managing General Partner is
not aware of any trends or events, commitments or
uncertainties that may materially impact liquidity.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Investments in joint ventures decreased during the nine
months ended July 31, 1997, primarily due to the
distribution to the Partnership of a portion of the net
proceeds (approximately $16.8 million) from the sale of
the Technology Park Reston office park.
Other assets decreased during the nine months ended
July 31, 1997, primarily due to the amortization of
prepaid real estate taxes (approximately $643,000) and
collection of accrued passthrough income (approximately
$237,000), both of which primarily relate to Laurel
Lakes Centre.
On August 27, 1997, the Partnership paid the third
quarter distribution of $4.35 per Unit to the Limited
Partners. The total cash distribution amounted to
$2,581,097 with $2,322,987 distributed to the Limited
Partners and $258,110 to the General Partners.
Operations
Fluctuations in the Partnership's operating results for
the three- and nine-month periods ended July 31, 1997
compared to 1996 were primarily attributable to the
following:
Rental revenues decreased during the three months ended
July 31, 1997 primarily due to a decrease in tenant
passthrough income and decreased occupancy at the
Laurel Lakes property. Rental revenues decreased
during the nine months ended July 31, 1997 primarily
due to the absence of rents of approximately $440,000
from the three shopping centers sold (the "Shopping
Centers Sold") in December 1995. Rental revenues also
decreased at Laurel Lakes Centre by approximately
$446,000 primarily due to a decrease in tenant
passthrough income and lower occupancy, and at Westland
Crossing by approximately $228,000 primarily due to
reduced occupancy. These decreases were partially
offset by higher rental income due to the increases in
occupancy at the Glenhardie and Holcomb Woods
properties.
The change in equity in earnings of joint ventures
during the three and nine month periods, respectively,
was primarily due to the sale of the Technology Park
Reston office park in the first quarter of fiscal 1997.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Interest income decreased during the nine months ended
July 31, 1997 due to the absence in 1997 of interest
earned on the proceeds from the Shopping Centers Sold,
offset by interest earned in 1997 on the proceeds from
the sale of the Technology Park Reston office park.
Property operating expenses decreased during the three
months ended July 31, 1997 primarily due to the absence
of approximately $171,000 of operating expenses from
the Shopping Centers Sold and decreased building
service expenses and other operating expenses of
approximately $78,000 at Laurel Lakes Centre.
Property operating expenses decreased during the nine
months ended July 31, 1997, also primarily due to the
absence of approximately $382,000 of operating expenses
from the Shopping Centers Sold, and decreased building
service expenses and other operating expenses of
approximately $261,000 at Laurel Lakes Centre.
In the first quarter of fiscal 1996, the Partnership
recorded losses on impairment of the Glenhardie and
Holcomb Woods properties totaling approximately $12.4
million.
A summary of the markets in which the Partnership's
properties are located and the performance of each
property is as follows:
The office market in suburban Atlanta, the location of
the Business Park at Holcomb Woods, continues to
improve with a current vacancy rate of approximately
3%. Rental rates have increased moderately in 1997 as
the Atlanta market's strong economic expansion and
continued corporate growth has resulted in increased
office occupancies. Several office projects are in the
planning stage of development or under construction in
the market; however, the Partnership expects that these
projects will have minimal effect on the Holcomb Woods
property. Occupancy at the property increased from 97%
to 99% during the third quarter 1997. No significant
leases expire until fiscal 1999. The Partnership is
currently marketing the property for sale.
Current market conditions in Valley Forge,
Pennsylvania, where the Chesterbrook Corporate Center
is located, continue to improve with market vacancies
improving to less than 12%. Effective rental rates
have also held steady in the market. During the third
quarter 1997 occupancy at the property increased from
99% to 100%.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
No leases for a significant amount of space expire
before 1998. The Partnership plans to market the
property for sale during the fourth quarter of fiscal
1997.
Glenhardie Corporate Center III and IV is also located
in Valley Forge, Pennsylvania. During the third
quarter of 1997 occupancy at the property remained at
approximately 87% as a result of Allstate Insurance Co.
vacating approximately 17,000 square feet of space
during the second quarter. No leases for significant
amounts of space expire before 1999. The Partnership
plans to market the property for sale during the fourth
quarter of fiscal 1997.
The overall vacancy level in the office market in
Westchester County, New York, the location of Taxter
Corporate Park, decreased to approximately 19% in the
third quarter, and the vacancy level in the west
Westchester market in which the building is located
decreased to approximately 11%. It is unlikely that
the vacant space will be absorbed in the market for
several years. However, during the third quarter of
1997, occupancy at the property increased from 99% to
100%. No leases for a significant amount of space
expire before 2001. The Partnership plans to market
the property for sale during fiscal 1998.
Laurel Lakes Centre is located in a suburb of Baltimore
and Washington, D.C., where retail centers continue to
experience strong competition and lower net rental
rates. The market vacancy rate remained at
approximately 16%. Many retailers in this market
continue to experience financial difficulties which has
negatively affected the property. During the quarter
ended July 31, 1997, occupancy at the property
decreased from 80% to 69%. The Partnership plans to
consolidate portions of the vacant small shop space at
the center. The Partnership is also attempting to
market approximately 50,000 square feet of space as
"big box" space. Although conversion into "big box"
type space would require additional investment by the
Partnership, the Partnership believes that the
potential for higher rental rates and increased
occupancy levels would increase the property's cash
flow as well as its overall value. No leases for
significant amounts of space expire before 2005.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Westland Crossing is situated outside downtown Detroit
and is in an overbuilt market with a current vacancy
rate of approximately 20%. A significant amount of new
retail space is under construction in this market;
however, the Partnership believes that it will not
compete with the property when complete. During the
third quarter of 1997, occupancy at the property
decreased slightly from 53% to 51%. As described
above, a lease agreement was signed with PetsMart for
approximately 27,000 square feet of space. Toys R Us,
an anchor tenant, has begun to renovate its space,
which is expected to positively impact the center when
completed during the fourth quarter of fiscal 1997.
The Partnership continues to look for opportunities to
consolidate vacant small shop space to make room for
larger tenants. No leases for significant amounts of
space expire before 2006.
Inflation
Inflation has been consistently low during the periods
presented in the financial statements and, as a result,
has not had a significant effect on the operations of
the Partnership or its properties.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
PART II - OTHER INFORMATION
Item 6. Exhibits & Reports on Form 8-K
(a) Exhibits -
An exhibit index has been filed as part of
this
Report on Page E1.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned thereunto
duly authorized.
DEAN WITTER REALTY INCOME
PARTNERSHIP III, L.P.
By: Dean Witter Realty Income
Properties III Inc.
Managing General Partner
Date: September 12, 1997 By: /s/E. Davisson
Hardman, Jr.
E. Davisson Hardman, Jr.
President
Date: September 12, 1997 By: /s/Lawrence Volpe
Lawrence Volpe
Controller
(Principal Financial and
Accounting Officer)
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Quarter Ended July 31, 1997
Exhibit Index
Exhibit No. Description
27 Financial Data Schedule
E1
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Registrant is a limited partnership which invests in real estate, and real
estate joint ventures. In accordance with industry practice, its balance
sheet is unclassified. For full information, refer to the accompanying
unaudited financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-END> JUL-31-1997
<CASH> 3,181,096
<SECURITIES> 0
<RECEIVABLES> 1,415,679
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 105,116,738<F1>
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 104,338,840<F2>
<TOTAL-LIABILITY-AND-EQUITY> 105,116,738<F3>
<SALES> 0
<TOTAL-REVENUES> 11,493,282<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5,977,825
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 5,515,457
<INCOME-TAX> 0
<INCOME-CONTINUING> 5,515,457
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,515,457
<EPS-PRIMARY> 9.47<F5>
<EPS-DILUTED> 0
<FN>
<F1>In addition to cash and receivables, total assets include net investments
in real estate of $74,997,221, investments in joint ventures of $24,366,211,
net deferred expenses of $841,542 and other assets of $314,989.
<F2>Other Stockholders' Equity represents partners' capital.
<F3>Liabilities include accounts payable and accrued liabilities of $624,203,
and security deposits of $153,695.
<F4>Total revenue includes rent of $8,155,685, equity in earnings of joint
ventures of $3,047,319, interest of $223,860 and other revenues of $66,418.
<F5>Represents net income per Unit of limited partnership interest.
</FN>
</TABLE>
