5
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 April 30, 1998
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
<TABLE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED BALANCE SHEETS
<CAPTION>
April 30, October
31,
1998 1997
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 1,440,647 $
1,967,110
Real estate, at cost:
Land 8,823,904
10,023,904
Buildings and improvements 55,254,922
72,927,556
64,078,826
82,951,460
Accumulated depreciation 13,601,423
20,484,407
50,477,403
62,467,053
Real estate held for sale - 11,941,818
Investments in joint ventures 7,608,376
24,127,982
Deferred leasing commissions, net 277,201
799,948
Other assets 1,193,208
2,486,957
$60,996,835
$103,790,868
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable and accrued liabilities $ 303,021 $
652,515
Security deposits 61,656
156,945
364,677
809,460
Partners' capital (deficiency):
General partners (8,448,006)
(8,453,230)
Limited partners ($500 per Unit, 534,020 Units issued)
69,080,164 111,434,638
Total partners' capital 60,632,158
102,981,408
$60,996,835
$103,790,868
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED INCOME STATEMENTS
Three and six months ended April 30, 1998 and 1997
<CAPTION>
Three months ended Six
months ended
April 30, April 30,
1998 1997 1998 1997
<S> <C> <C> <C>
<C>
Revenues:
Rental $ 1,795,753 $2,666,219 $
4,075,386 $5,511,095
Equity in earnings of joint ventures 17,254,114
577,905 17,865,015 2,408,927
Interest 127,848 96,400
197,175 196,451
Other 32,477 11,386
262,698 40,937
Gains on sales of real estate 9,526,466 -
15,716,729 -
28,736,658 3,351,910
38,117,003 8,157,410
Expenses:
Property operating 757,221 953,826
1,564,313 1,741,260
Depreciation 378,720 779,205
1,022,814 1,531,159
Amortization 29,396 87,679
70,920 155,161
General and administrative 227,229 222,529
431,699 516,548
1,392,566 2,043,239
3,089,746 3,944,128
Net income $27,344,092 $1,308,671
$35,027,257 $4,213,282
Net income allocated to:
Limited partners $27,234,797 $1,177,804
$34,768,671 $3,884,910
General partners 109,295 130,867
258,586 328,372
$27,344,092 $1,308,671
$35,027,257 $4,213,282
Net income per Unit of limited
partnership interest $ 51.00 $ 2.21 $
65.11 $ 7.28
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL
Six months ended April 30, 1998
<CAPTION>
Limited General
Partners Partners Total
<S> <C> <C>
<C>
Partners' capital (deficiency)
at November 1, 1997 $111,434,638
$(8,453,230) $102,981,408
Net income 34,768,671
258,586 35,027,257
Cash distributions (77,123,145)
(253,362) (77,376,507)
Partners' capital (deficiency)
at April 30, 1998 $ 69,080,164
$(8,448,006) $ 60,632,158
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended April 30, 1998 and 1997
<CAPTION>
1998
1997
<S> <C>
<C>
Cash flows from operating activities:
Net income $ 35,027,257 $
4,213,282
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 1,022,814
1,531,159
Amortization 70,920
155,161
Gain on sale of real estate (15,716,729)
- -
Equity in earnings of joint ventures (17,865,015)
(2,408,927)
(Increase) decrease in operating assets:
Deferred expenses (328,024)
(136,074)
Other assets 1,046,618
945,223
(Decrease) increase in operating liabilities:
Accounts payable and accrued liabilities
(401,726) (60,709)
Security deposits 10,376
(4,810)
Net cash provided by operating activities
2,866,491 4,234,305
Cash flows from investing activities:
Proceeds from disposition of real estate 40,487,606
- -
Additions to real estate (888,674)
(320,262)
Investments in joint ventures (447,638)
(362,575)
Distributions from joint ventures 34,832,259
19,782,711
Net cash provided by investing activities
73,983,553 19,099,874
Cash flows from financing activities:
Cash distributions (77,376,507)
(22,603,564)
Increase (decrease) in cash and cash equivalents
(526,463) 730,615
Cash and cash equivalents at beginning of period
1,967,110 2,380,612
Cash and cash equivalents at end of period $ 1,440,647 $
3,111,227
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 owned
an interest in Chesterbrook Corporate Center were
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 per Unit of limited partnership interest
amounts are calculated by dividing net income 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 gains on
sales of real estate (see Note 2), 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,
1997. Operating results of interim periods may not be
indicative of the operating results for the entire
year.
2. Real Estate
On November 7, 1997 the Partnership sold the land and
building which comprise the Holcomb Woods property to
W9/LWS Real Estate Limited Partnership, an unaffiliated
party, for $19,112,500. The purchase price was paid in
cash, and the Partnership received
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Notes to Consolidated Financial Statements
proceeds of approximately $18.7 million, net of closing
costs. On November 26, 1997 the Partnership
distributed these net proceeds ($35.06 per Unit) 100%
to Limited Partners.
On April 1, 1998 the Partnership sold the land and
buildings which comprise the Glenhardie Corporate
Center III and IV properties ("Glenhardie III and IV")
and an affiliated partnership sold its interest in the
remaining properties at Glenhardie Corporate Center.
In addition, the Partnership, another affiliated
partnership and an affiliate of the Managing General
Partner sold the Chesterbrook Corporate Center, in
which the Partnership has a 26.7% interest through a
joint venture, to an unaffiliated entity. The aggregate
price of the properties sold was approximately $168
million of which approximately $22.1 million was
allocated to Glenhardie III and IV, and approximately
$126.1 million, of which the Partnership's share is
approximately $33.7 million, was allocated to the
Chesterbrook Corporate Center. The purchase price was
paid in cash at closing. The Partnership received
proceeds, net of closing costs and other deductions, of
approximately $22 million and $33.4 million,
respectively, for the sale of the Glenhardie III and IV
properties and its share of the proceeds from the sale
of the Chesterbrook Corporate Center. On April 14,
1998, the Partnership distributed $56.1 million
($105.09 per Unit) of net proceeds from the sale of the
Glenhardie III and IV properties, its share of the
proceeds from the sale of the Chesterbrook Corporate
Center and from the remaining proceeds from the sale of
the Technology Park property. The distribution was
paid 100% to Limited Partners.
Pursuant to the sale Agreement, escrows were
established for the costs of certain building
improvements and tenant improvements (the
"Improvements"). In addition to payment of the
purchase price, at closing the Purchasers deposited
into these escrows approximately $3.9 million, of which
approximately $2.3 million relates to the Chesterbrook
Corporate Center. Any balances remaining in the
escrows relating to the Chesterbrook Corporate Center
after the Improvements are completed will be delivered
to the Partnership. If the costs of Improvements at
Chesterbrook Corporate Center exceed the escrow
established therefor, the
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Notes to Consolidated Financial Statements
Partnership, through DWR Chesterbrook Associates, will
be required to fund the excess costs.
Cash flow from Glenhardie III and IV, excluding sale
proceeds approximated $830,000 and $855,000 for the
quarters ended April 30, 1998 and 1997, respectively.
The Partnership's share of cash flow from Chesterbrook
Corporate Center, excluding sale proceeds, approximated
$1,034,000 and $1,335,000 for the quarters ended April
30, 1998 and 1997, respectively.
3. Related Party Transactions
An affiliate of the Managing General Partner provided
property management services for five properties as
well as for five buildings at the Chesterbrook
Corporate Center. The Partnership incurred management
fees of approximately $129,000 and $125,000 for the six
months ended April 30, 1998 and 1997, 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 six months ended April 30, 1998
and 1997, the Partnership incurred approximately
$269,000 and $319,000, respectively, for these
services. These amounts are included in general and
administrative expenses.
As of April 30, 1998, the affiliates were owed a total
of approximately $62,300 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
action lawsuits pending in state and federal courts.
The complaints allege a variety of claims, including
breach of fiduciary duty, fraud, misrepresentation and
related claims, and seek an accounting of profits,
compensatory and other damages and equitable relief.
The defendants intend to vigorously defend the actions.
It is impossible to predict the
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Notes to Consolidated Financial Statements
effect, if any, the outcome of these actions might have
on the Partnership's financial statements.
5. Subsequent Distribution
On May 27, 1998, the Partnership paid the second
quarter cash distribution of $1.50 per Unit to the
Limited Partners. The total cash distribution amounted
to $890,033, with $801,030 distributed to the Limited
Partners and $89,003 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 April 30, 1998, five office
and three retail properties have been sold. The
Partnership's acquisition program has been completed.
No additional investments are planned.
On November 7, 1997, the Partnership sold the Holcomb
Woods property. (See Note 2 to the consolidated
financial statements). On November 26, 1997 the
Partnership distributed $18.7 million ($35.06 per Unit)
of net proceeds from the sale, representing a return of
invested capital. The distribution was paid 100% to
Limited Partners. Net income from the Holcomb Woods
property for the first quarter of 1998 was $6,225,708
(including gain on the sale of the property of
$6,190,263). Cash flow from operations for the first
quarter of 1998 was approximately $130,000.
On April 1, 1998, the Partnership sold the Glenhardie
III and IV properties and the Chesterbrook Corporate
Center joint venture sold its property investment.
(See Note 2 to the consolidated financial statements).
On April 14, 1998, the Partnership distributed $56.1
million ($105.09 per Unit) of net proceeds from the
sale of the Glenhardie III and IV properties, its share
of the proceeds from the sale of the Chesterbrook
Corporate Center and from the remaining proceeds from
the sale of the Technology Park property. The
distribution was paid 100% to Limited Partners. Net
income from the Glenhardie III and IV properties and
the Partnership's equity in earnings from the
Chesterbrook Corporate Center joint venture for the
second quarter was $10,074,455 (including gain on the
sale of the properties of $9,526,466) and $17,528,821
(including gain on the sale of the property of
$16,724,672), respectively. Cash flow from operations
from the Glenhardie III and IV properties and the
Partnership's share of the Chesterbrook Corporate
Center were approximately $239,000 and $149,000,
respectively.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
As a result of the sales of the Glenhardie III and IV
properties and the Chesterbrook Corporate Center, the
Partnership reduced the quarterly distribution from
$1.97 per Unit to $1.50 per Unit, beginning with the
May 1998 distribution.
The Partnership's liquidity depends upon cash flow from
operations of its properties and expenditures for
building improvements, tenant improvements and leasing
commissions. During the six months ended April 30,
1998, all of the Partnership's properties and joint
venture interests generated positive cash flow from
operations, and the Partnership anticipates that its
remaining properties will continue to do so for the
remainder of fiscal 1998.
In addition, the Partnership's liquidity has been and
will continue to be affected by the sale of 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 six months ended April 30, 1998, excluding
proceeds and distribution amounts relating to property
sales, 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 joint
ventures.
During the six months ended April 30, 1998, the
Partnership incurred approximately $1,217,000 of tenant
improvements, building improvements and leasing
commissions at the Glenhardie ($1,108,000), Laurel
Lakes ($28,000) and Westland Crossing ($81,000)
properties. The Partnership also contributed
approximately $339,000 to the Chesterbrook joint
venture and approximately $109,000 to the Taxter joint
venture, for its share of capital expenditures and
leasing commissions.
As of April 30, 1998, the Partnership has commitments
to fund approximately $154,000 for tenant improvements,
building improvements and leasing commissions and to
contribute approximately $240,000, its share of capital
expenditures and leasing commissions to the Taxter
Corporate Park joint venture. The Partnership through
DWR Chesterbrook Associates may also be
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
required to fund certain costs at the Chesterbrook
property. (See Note 2 to the consolidated financial
statements).
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 1998, the Partnership expects
that its cash flow from operations and distributions
received from its joint ventures will exceed
distributions to Limited Partners (other than
distributions of net proceeds from property sales). 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 1998.
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.
Other assets decreased during the six months ended
April 30, 1998, primarily due to the amortization of
prepaid real estate taxes (approximately $386,000) and
collection of certain tenant receivables (approximately
$227,000) relating to Laurel Lakes Centre, and due to
the sale of the Holcomb Woods (approximately $215,000)
and Glenhardie III and IV properties (approximately
$211,000).
On May 27, 1998, the Partnership paid the second
quarter distribution of $1.50 per Unit to the Limited
Partners. The total cash distribution amounted to
$890,033 with $801,030 distributed to the Limited
Partners and $89,003 to the General Partners.
Operations
Fluctuations in the Partnership's operating results for
the three- and six-month periods ended April 30, 1998
compared to 1997 were primarily attributable to the
following:
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Rental revenues, operating expenses and depreciation
and amortization decreased during the three- and six-
month periods primarily due to the sale of the Holcomb
Woods and Glenhardie III and IV properties in the first
and second quarter of fiscal 1998, respectively.
The increases in equity in earnings of joint ventures
during the three- and six-month periods are primarily
due to the sale of the Chesterbrook Corporate Park.
Other income increased during the six months ended
April 30, 1998 compared to 1997 primarily due to a
lease termination fee of approximately $110,000
received at the Glenhardie properties.
A summary of the markets in which the Partnership's
properties are located and the performance of each
property is as follows:
During fiscal 1998, the overall vacancy level in the
office market in Westchester County, New York, the
location of Taxter Corporate Park, has remained at
approximately 17%, and the vacancy level in the west
Westchester market in which the building is located
decreased from 11% to 9%. Market rental rates are
currently stable and there is little new construction
in this market. Occupancy at the property during fiscal
1998 has remained at 100%. Leases aggregating
approximately 11% and 31% of the property's space are
scheduled to expire in 1999 and 2001, respectively.
The Partnership is currently marketing the property for
sale, with the objective of completing the sale before
October 31, 1998. However, there can be no assurance
that the Property will be sold.
Laurel Lakes Centre is located in a suburb of Baltimore
and Washington, D.C., where retail centers continue to
experience strong competition. The market vacancy is
approximately 16% with rental rates increasing slightly
for the quarter ended April 30, 1998. Many retailers
in this market continue to experience financial
difficulties which have negatively affected the
property. As of April 30, 1998, occupancy at the
property remained at 72%. The Partnership is
considering redevelopment alternatives which would
enhance the value of the property, some of which would
require additional investment by the Partnership. No
leases for significant amounts of space expire before
2005. The Partnership plans to market the property for
sale during fiscal 1998.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Westland Crossing is situated outside downtown Detroit
in an overbuilt market with a current vacancy rate of
approximately 13%. During the second quarter of 1998,
occupancy at the property decreased slightly to 68%.
The Partnership continues to market approximately
27,000 square feet of vacant anchor space and is
negotiating with a national tenant to lease
approximately 25,000 square feet of this space. The
Partnership is also investigating other redevelopment
alternatives which are intended to enhance the value of
the property, some of which would require additional
investment by the Partnership. No leases for
significant amounts of space expire before 2006. The
Partnership is currently marketing the property for
sale with the objective of completing the sale before
October 31, 1998. However, there can be no assurance
that the property will be sold.
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 1. Legal Proceedings
On December 27, 1995, a purported class action lawsuit
(the "Grigsby Action") naming various public real
estate partnerships sponsored by Realty (including the
Partnership and its Managing General Partner and
Associate General Partner), Realty, Dean Witter
Reynolds Inc. ("DWR") and others as defendants was
filed in Superior Court in California. The complaint
alleged fraud, negligent misrepresentation, intentional
and negligent breach of fiduciary duty, unjust
enrichment and related claims and sought compensatory
and punitive damages in unspecified amounts and
injunctive and other equitable relief. The defendants
removed the case to the United States District Court
for the Southern District of California. Pursuant to
an order of the U.S. District Court for the southern
District of California entered May 24, 1996, the
Grigsby Action was transferred to the U.S. District
Court for the Southern District of New York. The case
was dismissed by stipulation of the parties dated March
6, 1997 and refiled and consolidated with the
Consolidated Action (as defined below).
On February 14, 1996, a purported class action lawsuit
(the "Schectman Action") naming various public real
estate partnerships sponsored by Realty (including the
Partnership and its Managing General Partner), Realty,
Dean Witter, Discover & Co. ("DWD") and DWR as
defendants was filed in the Chancery Court of Delaware
for New Castle County (the "Delaware Chancery Court").
On February 23, 1996, a purported class action lawsuit
(the "Dosky Action") naming various public real estate
partnerships sponsored by Realty (including the
Partnership and its Managing General Partner), Realty,
DWD, DWR and others as defendants was filed in the
Delaware Chancery Court. On February 29, 1996, a
purported class action lawsuit (the "Segal Action')
naming various public real estate partnerships
sponsored by Realty (including the Partnership and its
Managing General Partner), Realty, DWD, DWR and others
as defendants was filed in the Delaware Chancery Court.
On March 13, 1996, a purported class action lawsuit
(the "Young Action") naming the partnership, other
unidentified limited partnerships, DWD, DWR and others
as defendants was filed in the Circuit Court for
Baltimore City in Baltimore, Maryland. The defendants
removed the Young Action to the United States District
Court for the District of Maryland.
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Thereafter, the Schectman Action, the Dosky Action and
the Segal Action were consolidated in a single action
(the "Consolidated Action") in the Delaware Chancery
Court. The Young Action was dismissed without
prejudice. The plaintiffs in the Young Action joined
the Consolidated Action.
On October 7, 1996, the plaintiffs in the Consolidated
Action filed a First Consolidated and Amended Class
Action Complaint naming various public real estate
partnerships sponsored by Realty (including the
Partnership and its Managing General Partner), Realty,
DWD, DWR and others as defendants. This complaint
alleges breach of fiduciary duty and seeks an
accounting of profits, compensatory damages in an
unspecified amount, possible liquidation of the
Partnership under a receiver's supervision and other
equitable relief. The defendants filed a motion to
dismiss this complaint on December 10, 1996.
Item 6. Exhibits & Reports on Form 8-K
(a) Exhibits.
An exhibit index has been filed as part of
this
Report on Page E1.
(b) Reports on Form 8-K.
1. Report dated April 1, 1998
reporting the sale of the Glenhardie
Corporate Center and Chesterbrook
Corporate Center.
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: June 12, 1998 By: /s/E. Davisson Hardman,
Jr.
E. Davisson Hardman, Jr.
President
Date: June 12, 1998 By: /s/Charles M. Charrow
Charles M. Charrow
Controller
(Principal Financial and
Accounting Officer)
DEAN WITTER REALTY INCOME PARTNERSHIP III, L.P.
Quarter Ended April 30, 1998
Exhibit Index
Exhibit No. Description
27 Financial Data Schedule
E1
[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.
<TABLE>
<S> <C>
[PERIOD-TYPE] 6-MOS
[FISCAL-YEAR-END] OCT-31-1998
[PERIOD-END] APR-30-1998
[CASH] 1,440,647
[SECURITIES] 0
[RECEIVABLES] 913,869
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 0
[PP&E] 0
[DEPRECIATION] 0
[TOTAL-ASSETS] 60,996,835<F1>
[CURRENT-LIABILITIES] 0
[BONDS] 0
[COMMON] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 60,632,158<F2>
[TOTAL-LIABILITY-AND-EQUITY] 60,996,835<F3>
[SALES] 0
[TOTAL-REVENUES] 38,117,003<F4>
[CGS] 0
[TOTAL-COSTS] 0
[OTHER-EXPENSES] 3,089,746
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] 35,027,257
[INCOME-TAX] 0
[INCOME-CONTINUING] 35,027,257
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 35,027,257
[EPS-PRIMARY] 65.11<F5>
[EPS-DILUTED] 0
<FN>
<F1>In addition to cash and receivables, total assets include net investments
in real estate of $50,477,403, investments in joint ventures of $7,608,376,
net deferred expenses of $277,201 and other assets of $279,339.
<F2>Other Stockholders' Equity represents partners' capital.
<F3>Liabilities include accounts payable and accrued liabilities of $303,021,
and security deposits of $61,656.
<F4>Total revenue includes rent of $4,075,386, equity in earnings of joint
ventures of $17,865,015, interest of $197,175, other revenues of $262,698 and
gain on sale of real estate of $15,716,729.
<F5>Represents net income per Unit of limited partnership interest.
</FN>
</TABLE>
