UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 1995
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 0-15816
Krupp Cash Plus-II Limited Partnership
Massachusetts 04-2915326
(State or other jurisdiction of (IRS employer
incorporation or organization) identification no.)
470 Atlantic Avenue, Boston, Massachusetts 02210
(Address of principal executive offices) (Zip Code)
(617) 423-2233
(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 (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>
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
<TABLE>
<CAPTION>
BALANCE SHEETS
ASSETS
March 31, December 31,
1995 1994
<S> <C> <C>
Real estate assets:
Multi-family apartment complex, less
accumulated depreciation of $3,784,694
and $3,670,683, respectively $ 6,355,376 $ 6,424,540
Retail centers, less accumulated depreciation
of $11,312,365 and $10,931,523, respectively 38,493,357 38,858,760
Investment in joint venture (Note 2) 21,279,753 21,339,973
Mortgage-backed securities ("MBS") (Note 3) 9,562,617 9,815,123
Total real estate assets 75,691,103 76,438,396
Cash and cash equivalents 4,972,436 7,072,127
Other investments (Note 3) 2,386,995 -
Other assets 550,838 766,734
Total assets $83,601,372 $84,277,257
LIABILITIES AND PARTNERS' EQUITY
Accounts payable $ 67,364 $ 221,510
Accrued expenses and other liabilities 593,800 593,123
Total liabilities 661,164 814,633
Commitments and contingencies (Note 2)
Partners' equity (Note 4) 82,940,208 83,462,624
Total liabilities and partners' equity $83,601,372 $84,277,257
</TABLE>
Companying notes are an integral
part of the financial statements.
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
1995 1994
<C> <C>
Revenue:
Rental $1,639,328 $1,615,548
Partnership's share of joint venture
net income (Note 2) 189,780 177,297
Interest income - MBS 215,214 268,598
Interest income - other 107,045 49,277
Total revenue 2,151,367 2,110,720
Expenses:
Operating (including reimbursements to
affiliates of $18,235 and $55,718,
respectively) 206,290 247,408
Maintenance 72,389 131,610
General and administrative (including
reimbursements to affiliates of
$51,579 and $86,377, respectively) 71,848 112,550
Real estate taxes 218,799 241,836
Management fees paid to an affiliate 91,143 88,820
Depreciation 494,853 458,896
Total expenses 1,155,322 1,281,120
Net income $ 996,045 $ 829,600
Allocation of net income (Note 4):
Net income per Unit of Depositary Receipt
(7,499,818 Units outstanding) $ .13 $ .11
Corporate Limited Partner $ 13 $ 11
General Partners $ 19,921 $ 16,592
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
<TABLE>
<CAPTION>
STATEMENTS OF CASH FLOWS
For the Three Months
Ended March 31,
1995 1994
<S> <C> <C> <C>
Operating activities:
Net income $ 996,045 $ 829,600
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 494,853 458,896
Partnership's share of joint venture
net income (189,780) (177,297)
Distribution received from joint venture 250,000 164,000
Amortization of MBS discount, net (1,420) (1,572)
Decrease (increase) in other assets 215,896 (9,892)
Decrease in accounts payable (154,146) (86,102)
Increase in accrued expenses
and other liabilities 677 13,762
Net cash provided by operating
activities 1,612,125 1,191,395
Investing activities:
Additions to fixed assets (60,286) (10,633)
Principal collections on MBS 253,926 1,017,687
Increase in other investments (2,386,995) -
Net cash provided by (used in)
investing activities (2,193,355) 1,007,054
Financing activity:
Distributions (1,518,461) (1,528,867)
Net decrease in cash and cash equivalents (2,099,691) 669,582
Cash and cash equivalents, beginning of period 7,072,127 5,622,515
Cash and cash equivalents, end of period $4,972,436 $ 6,292,097
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(1) Accounting Policies
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted in this report on
Form 10-Q pursuant to the Rules and Regulations of the Securities and
Exchange Commission. In the opinion of the General Partners of Krupp
Cash Plus-II Limited Partnership (the "Partnership") the disclosures
contained in this report are adequate to make the information presented
not misleading. See Notes to Financial Statements included in the
Partnership's Annual Report on Form 10-K for the year ended December 31,
1994 for additional information relevant to significant accounting
policies followed by the Partnership.
In the opinion of the General Partners of the Partnership, the
accompanying unaudited financial statements reflect all adjustments
(consisting of only normal recurring accruals) necessary to present
fairly the Partnership's financial position as of March 31, 1995 and its
results of operations and cash flows for the three months ended March
31, 1995 and 1994.
The results of operations for the three months ended March 31, 1995 are
not necessarily indicative of the results which may be expected for the
full year. See Management's Discussion and Analysis of Financial
Condition and Results of Operations included in this report.
(2) Investment in Joint Venture
The Partnership and an affiliate of the Partnership each have a 50%
interest in the Joint Venture. The express purpose of entering into the
Joint Venture was to acquire and operate Brookwood Village Mall and
Convenience Center ("Brookwood Village"). Brookwood Village is a
shopping center containing 478,738 net leasable square feet located in
Birmingham, Alabama.
Under the purchase and sale agreement entered into by the Partnership,
its affiliates and the previous owner, the previous owner retained an
interest related to the future development at Brookwood Village. The
seller is entitled to receive up to $5,000,000 of proceeds from the sale
of Brookwood Village and potentially additional amounts related to
expansion and development. The Joint Venture holds title to Brookwood
Village free and clear from all other material liens or encumbrances.
Continued
<PAGE> KRUPP CASH PLUS-II LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS - Continued
(2) Investment in Joint Venture - Continued
Condensed financial statements of the Joint Venture are as follows:
Brookwood Village Joint Venture
<TABLE>
<CAPTION>
Condensed Balance Sheets
ASSETS
March 31, December 31,
<S> <C> <C>
1995 1994
Property, at cost $ 54,934,446 $ 54,898,470
Accumulated depreciation (13,345,251) (12,854,388)
41,589,195 42,044,082
Other assets 1,526,473 1,145,125
Total assets $ 43,115,668 $ 43,189,207
LIABILITIES AND PARTNERS' EQUITY
Total liabilities $ 556,162 $ 509,261
Partners' equity
The Partnership 21,279,753 21,339,973
Joint venture partner 21,279,753 21,339,973
Total partners' equity 42,559,506 42,679,946
Total liabilities and partners' equity $ 43,115,668 $ 43,189,207
Brookwood Village Joint Venture
Condensed Statements of Operations
For the Three Months
Ended March 31,
1995 1994
Revenue $ 1,585,868 $ 1,522,985
Property operating expenses (715,444) (707,720)
Income before depreciation 870,424 815,265
Depreciation (490,864) (460,671)
Net income $ 379,560 $ 354,594
</TABLE>
Continued
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS - Continued
(3) MBS and Other Investments
At March 31, 1995, the Partnership's MBS Portfolio had an approximate
market value of $9,888,000 with unrealized gains of $394,000 and
unrealized losses of $69,000. The Partnership does not expect to
realize these gains or losses as it has the intention and ability to
hold the MBS until maturity.
At March 31, 1995, the Partnership held investments in commercial
paper and a bankers' acceptance, all maturing within one year. The
cost approximates the market value.
(4) Changes in Partners' Equity
A summary of changes in Partners' equity (deficit) for the three
months ended March 31, 1995 is as follows:
<TABLE>
<CAPTION>
Corporate Total
Limited General Partners'
Unitholders Partner Partners Equity
<S> <C> <C> <C> <C>
Balance at
December 31, 1994 $83,767,580 $ 1,322 $(306,278) $83,462,624
Net income 976,111 13 19,921 996,045
Distributions (1,499,944) (20) (18,497) (1,518,461)
Balance at
March 31, 1995 $83,243,747 $ 1,315 $(304,854) $82,940,208
</TABLE>
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Partnership's liquidity is derived from the operations of the
Partnership's properties (Encino Oaks, Alderwood, Canyon Place, Coral Plaza
and Cumberland Glen), distributions from the Partnership's interest in
Brookwood Village Joint Venture, earnings and collections on MBS, and
interest earned on its short-term investments. The Partnership's liquidity
is utilized to pay operating costs and to fund distributions to the
partners.
Management has found it necessary in recent years to pay a large share
of tenant buildouts to attract quality tenants to our retail centers. This
policy has proven to be successful in attracting tenants and maintaining
high occupancy at properties where it has been undertaken and is expected
to continue through 1995. In order to remain competitive in their
respective markets, the Partnership's properties are anticipated to spend
$761,000 for fixed assets in 1995 most of which are tenant buildouts at
retail centers. The Joint Venture is expected to spend $599,000 for
capital renovations.
Principal collections on MBS have slowed significantly in the first
quarter of 1995 because rising mortgage interest rates have decreased the
refinancing activity which led to prepayments of the mortgages underlying
the MBS previously. Management will continue to monitor liquidity levels
to assure that working capital levels are being maintained.
Continued
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
Distributable Cash Flow and Net Cash Proceeds from Capital Transactions
Shown below is the calculation of Distributable Cash Flow and Net Cash
Proceeds from Capital Transactions as defined by Section 17 of the
Partnership Agreement for the three months ended March 31, 1995 and the
period from inception to March 31, 1995.
(In $1,000 except per Unit amounts)
<TABLE>
<CAPTION>
For the three months Inception to
Ended
March 31, March 31,
1995 1995
<S> <C> <C>
Distributable Cash Flow:
Net income for tax purposes $1,148 $41,860
Items providing/not requiring or (not
providing) the use of operating funds:
Tax basis depreciation and amortization 421 13,525
Acquisition expenses paid from offering
proceeds charged to operations - 248
Partnership's share of joint venture
taxable net income (290) (5,134)
Distributions from joint venture 250 7,357
Additions to fixed assets (60) (2,173)
Amounts released from reserves
for capital improvements - 1,020
Total Distributable Cash Flow ("DCF") $1,469 $56,703
Limited Partners' Share of DCF $1,440 $55,569
Limited Partners' Share of DCF per Unit $ .19 $ 7.41
General Partners' Share of DCF $ 29 $ 1,134
Net Proceeds from Capital Transactions:
Principal collections on MBS $ 253 $35,572
Reinvestment of MBS principal collections - (3,687)
Total Net Proceeds from Capital
Transactions $ 253 $31,885
Distributions:
Limited Partners $1,500(a) $89,318(b)
Limited Partners' Average per Unit $ .20(a) $11.91(b)(c)
General Partners $ 29(a) $ 1,134(b)
Total Distributions $1,529(a) $90,452(b)
</TABLE>
(a) Represents an estimate of the distribution to be paid in May, 1995.
(b) Includes estimate of the distribution to be paid in May, 1995.
(c) Limited Partners average per Unit return of capital as of May, 1995
is $4.50 [$11.91 - $7.41].
Continued
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
Operations
Partnership
Rental revenues have increased slightly for the three months ended March
31, 1995 as compared to the same period in 1994 due mainly to the
fluctuations in occupancy rates at both Canyon Place and Coral Plaza
between the two periods. Canyon Place experienced an 8% increase in
occupancy over 1994 due to the expansion of larger tenants. Coral
Plaza's occupancy decreased 4% for the three months ended March 31, 1995
as compared to the same period in 1994 due to the move out of Jazzercise
in 1994.
MBS interest income decreased in the first quarter of 1995 as compared
to the same period in 1994 due to the large prepayments of principal
which occurred during the first half of 1994. Interest income on
short-term investments increased during these same periods due to higher
average cash balances.
Total expenses for the Partnership decreased $126,000 for the three
months ended March 31, 1995 as compared to the same period in 1994. The
decrease in operating expenses was due to management's efforts to reduce
reimbursable operating and general and administrative expenses. Certain
of these costs savings are anticipated to continue throughout 1995.
Maintenance expenses have decreased as a result of increased preventive
maintenance at Encino Oaks in 1994.
Joint Venture
Brookwood's revenues and expenses have remained relatively stable for
the three months ended March 31, 1995 as compared to the same period in
1994.
<PAGE>
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Response: None
Item 2. Change in Securities
Response: None
Item 3. Defaults upon Senior Securities
Response: None
Item 4. Submission of Matters to a Vote of Security Holders
Response: None
Item 5. Other Information
Response: None
Item 6. Exhibits and Reports on Form 8-K
Response: None
<PAGE>
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.
Krupp Cash Plus-II Limited Partnership
(Registrant)
BY: /s/Marianne Pritchard
Marianne Pritchard
Treasurer and Chief Accounting Officer,
The Krupp Corporation, a General Partner
DATE: May 2, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS FDS SCHEDULE FOR KRUPP CASH PLUS-II CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE FINANCIAL STATEMENTS FOR THE QUARTER ENDED MARCH 31, 1995 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 7,359,431<F1>
<SECURITIES> 9,562,617
<RECEIVABLES> 359,206
<ALLOWANCES> 191,632
<INVENTORY> 0
<CURRENT-ASSETS> 191,632
<PP&E> 81,225,545<F2>
<DEPRECIATION> (15,097,059)
<TOTAL-ASSETS> 83,601,372
<CURRENT-LIABILITIES> 661,164
<BONDS> 0
<COMMON> 82,940,208<F3>
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 83,601,372
<SALES> 2,151,367<F4>
<TOTAL-REVENUES> 2,151,367
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,155,322<F5>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Includes cash in bank accounts for $4,972,436 and short-term investments of
$2,386,995.
<F2>Includes multi-family complex of $10,140,070, retail centers of $49,805,722
and investment in J.V.of $21,279,753.
<F4>Includes all revenue for the Partnership.
<F3>Equity of General Partners ($304,854), limited partners of $83,245,062.
<F5>Includes all expenses for the Partnership.
</FN>
</TABLE>
