FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
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: 33-3657
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
-----------------------------------------------------
(Exact name of Registrant as specified in its charter)
California 94-3193010
------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 South El Camino Real,
Suite 1100
San Mateo, California 94402
--------------------- ------------
(Address of principal (Zip Code)
executive offices)
(415) 343-9300
-----------------------------
(Registrant's telephone number)
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
--- ---
Total number of units outstanding as of June 30, 1996: 2,910,899
NO EXHIBIT INDEX REQUIRED
Page 1 of 18
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
Consolidated Balance Sheets
(In thousands, except units outstanding)
(Unaudited)
<CAPTION>
June 30, December 31,
1996 1995
---------- ----------
<S> <C> <C>
Assets
------
Real estate investments, at cost:
Land $ 483 $ 483
Buildings and improvements 2,781 2,778
-------- --------
3,264 3,261
Less:
Accumulated depreciation (114) (75)
-------- --------
Net real estate investments 3,150 3,186
Real estate held for sale, net 4,315 4,307
Other Assets:
Cash and cash equivalents 1,060 812
Receivables 26 33
Due from affiliate --- 235
Deferred financing and other fees,
net of accumulated amortization
of $235 and $219 at June 30, 1996
and December 31, 1995, respectively 55 64
Prepaid expenses and other assets 31 132
Investment in unconsolidated joint
ventures 1,048 1,063
Investment in affiliated partnerships 299 ---
-------- --------
Total assets $ 9,984 $ 9,832
======== ========
</TABLE>
(continued)
Page 2 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
Consolidated Balance Sheets - continued
(In thousands, except units outstanding)
(Unaudited)
<CAPTION>
June 30, December 31,
1996 1995
-------- --------
<S> <C> <C>
Liabilities and Partners' Equity
--------------------------------
Liabilities:
Notes payable $ 5,022 $ 5,035
Accounts payable and accrued
expenses 197 146
Deposits and other liabilities 135 43
-------- --------
Total liabilities 5,354 5,224
-------- --------
Partners' equity:
General partners 422 420
Limited partners, 2,910,899 and
2,961,853 units outstanding at
June 30, 1996 and December 31,
1995, respectively 4,208 4,188
-------- --------
Total partners' equity 4,630 4,608
-------- --------
Total liabilities and partners'
equity $ 9,984 $ 9,832
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
Page 3 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
Consolidated Statements of Operations
(in thousands, except per unit amounts)
(Unaudited)
<CAPTION>
Three months Six months
ended ended
June 30, June 30,
1996 1995 1996 1995
------- ------- ------- -------
<S> <C> <C> <C> <C>
Revenues:
Rental income $ 192 $ 763 $ 385 $ 1,510
Income from investment in
affiliated partnerships 162 --- 162 ---
Interest and other income 237 215 242 253
------- ------- ------- -------
Total revenues 591 978 789 1,763
------- ------- ------- -------
Expenses:
Operating (including $29 and
$63 paid to affiliates in
1996 and 1995, respectively) 168 183 301 347
General and administative
(including $110 and $145 paid
to affiliates in 1996 and
1995, respectively) 84 128 154 214
Depreciation and amortization 28 161 55 328
Interest expense 117 469 235 960
------- ------- ------- -------
Total expenses 397 941 745 1,849
------- ------- ------- -------
Income/(loss) before other
income/(expenses) 194 37 44 (86)
Other income/(expenses):
Equity income (loss) on
investment in unconsol-
idated joint ventures 3 1 34 (58)
------- ------- ------- -------
Net income (loss) $ 197 $ 38 $ 78 $ (144)
======= ======= ======= =======
Net income (loss) per limited
partnership unit $ 0.07 $ 0.01 $ 0.03 $ (0.05)
======= ======= ======= =======
Distributions per limited
partnership unit $ --- $ --- $ --- $ ---
======= ======= ======= =======
Weighted average number of
limited partnership units
outstanding during each
period used to compute
net income (loss) per
limited partnership unit 2,961,853 2,961,853 2,961,853 2,961,853
========= ========= ========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
Page 4 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
Consolidated Statements of Partners' Equity
(in thousands)
For the six months ended June 30, 1996 and 1995
(Unaudited)
<CAPTION>
Total
General Limited Partners'
Partner Partners Equity
---------- ---------- ----------
<S> <C> <C> <C>
Balance at December 31, 1994 $ 435 $ 4,854 $ 5,289
Net loss (3) (141) (144)
-------- --------- ---------
Balance at June 30, 1995 $ 432 $ 4,713 $ 5,145
======== ========= =========
Balance December 31, 1995 $ 420 $ 4,188 $ 4,608
Redemption of units --- (56) (56)
Net income 2 76 78
-------- --------- ---------
Balance June 30, 1996 $ 422 $ 4,208 $ 4,630
======== ========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
Page 5 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
<CAPTION>
For the six months
ended
June 30,
----------------------
1996 1995
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 78 $ (144)
Adjustments to reconcile net income
(loss) to net cash provided by
(used for) operating activities:
Depreciation and amortization 55 328
Equity (income) loss on investment
in unconsolidated joint ventures (34) 58
Changes in certain assets and liabilities:
Receivables 7 (5)
Deferred financing and other fees (7) (1)
Prepaid expenses and other assets 19 57
Accounts payable and accrued
expenses (43) (422)
Deposits and other liabilities 92 (2)
Advance from related party --- (60)
------- -------
Net cash provided by (used for)
operating activities 167 (191)
------- -------
</TABLE>
(continued)
Page 6 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
<TABLE>
Consolidated Statements of Cash Flows - continued
(in thousands)
(Unaudited)
<CAPTION>
For the six months
ended
June 30,
----------------------
1996 1995
-------- --------
<S> <C> <C>
Cash flows from investing activities:
Distribution from unconsolidated joint
venture $ 49 $ ---
Investment in unconsolidated joint
venture --- (58)
Investment in affiliated partnership (205) ---
Improvements to real estate (11) (94)
Decrease in interest receivable --- (7)
Increase in notes receivable --- (233)
Decrease in prepaid expenses and other
assets 82 51
-------- --------
Net cash used for investing activities (85) (341)
-------- --------
Net cash flows from financing activities:
Due from affiliate 235 ---
Redemption of limited partnership units (56) ---
Principal payments on notes payable (13) (1,700)
-------- --------
Net cash provided by (used for)
financing activities 166 (1,700)
-------- --------
Net increase (decrease) in cash and
cash equivalents 248 (2,232)
Cash and cash equivalents, beginning
of period 812 2,604
-------- --------
Cash and cash equivalents, end
of period $ 1,060 $ 372
======== ========
Supplemental disclosure of cash flow
information:
Cash paid for interest $ 234 $ 926
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
Page 7 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
Notes to Consolidated Financial Statements
June 30, 1996
(Unaudited)
Note 1. SUMMARY OF ORGANIZATION
-----------------------
Glenborough Partners, A California Limited Partnership
("Partnership" or "Partners"), is the successor to Glenborough
Limited, A California Limited Partnership pursuant to section
15d-5 of the Securities Exchange Act of 1934.
On May 21, 1992, GOCO Realty Fund I, the partnership holding and
operating the Partnership's real property (including its related
Brazos Debt), filed a petition in the United States Bankruptcy
Court for the Northern District of California for reorganization
under Chapter 11 of the Federal Bankruptcy Code. On January 13,
1994, a plan of reorganization was filed with the Bankruptcy
court which became effective January 24, 1994. This partnership
has since been renamed, GPA Ltd., A California Limited
Partnership ("GPA").
The general partners of both Partners and GPA are Glenborough
Corporation, a California corporation (formerly known as
Glenborough Realty Corporation) and Robert Batinovich
(collectively "Glenborough" or "General Partner"). Glenborough
Corporation is the managing general partner of the Partnership.
Glenborough Partners is the sole limited partner of GPA.
To facilitate the Partnership's holding and transfer of real
property as set forth under the plan of reorganization, two
partnerships were created in February 1994: (i) GPA West, L.P.
("West"); and (ii) GPA Industrial, L.P. ("Industrial"). A third
subsidiary partnership, GPA Bond L.P.("Bond"), was created in
December 1994 to hold and operate a property purchased on
December 29, 1994.
Through December 31, 1995, all three partnerships were
subsidiaries of GPA. The general partners of each of these
partnerships were Glenborough Corporation and Robert Batinovich
while the sole limited partner of each was GPA. On December 31,
1995, the Partnership contributed Industrial and its four
properties to an affiliated partnership, Glenborough Properties,
L.P. ("Properties"), the operating partnership of Glenborough
Realty Trust Incorporated, a real estate investment trust managed
by affiliates of the Partnership, in exchange for 542,333 limited
partnership units in Properties. The debt securing the
properties owned by Industrial was assumed by the acquiring
partnership. As a result, Industrial ceased to be a subsidiary
at the end of calendar year 1995.
On September 6, 1995, West made an $1,050,000 investment in an
unconsolidated joint venture, GRC Airport Associates. Since
Page 8 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
Notes to Consolidated Financial Statements
June 30, 1996
(Unaudited)
West's 25% (of total limited partners contributions) investment
in this joint venture is less than 50%, the Partnership accounts
for this joint venture on an equity method.
In June, 1996, the Partnership purchased 111,589 units in Glenco
Squaw Associates ("Squaw"), an affiliated partnership, for
$299,000 ($205,000 cash and $94,000 in payables) from various
investors. The Partnership's ownership in Squaw represents 11%
of the total outstanding units. Therefore, the Partnership's
investment in this joint venture is accounted for on an equity
method.
Note 2. SIGNIFICANT ACCOUNTING POLICY
-----------------------------
In the opinion of Glenborough Corporation, the managing general
partner, the accompanying unaudited financial statements contain
all adjustments (consisting of only normal accruals) necessary to
present fairly the financial position of Glenborough Partners, A
California Limited Partnership, at June 30, 1996 and December 31,
1995, the related statements of operations for the three and six
months ended June 30, 1996 and 1995, and the statements of
partners' equity and cash flows for the six months ended June 30,
1996 and 1995.
Certain items in the 1995 financial statements have been
reclassified to conform to the 1996 financial statement
presentation.
Note 3. REFERENCE TO 1995 AUDITED FINANCIAL STATEMENTS
----------------------------------------------
These unaudited financial statements should be read in
conjunction with the Notes to Consolidated Financial Statements
included in the 1995 audited financial statements.
Note 4. NET INCOME (LOSS) PER LIMITED PARTNERSHIP UNIT
----------------------------------------------
Pursuant to the Partners and GPA Ltd. partnership agreements, the
general partners hold a 2.27% share of the Partnership's net
income or loss and distributions in the six months ended June 30,
1996. This percentage is derived from the general partners' 1%
direct interest in GPA Ltd. and a 1.27% indirect interest through
their 1.28% general partner interest in Glenborough Partners' 99%
interest in GPA Ltd.
As of June 30, 1996, as a result of an offer made to all of the
Partnership's investors in April, 1996, the Partnership paid
$56,000 to repurchase 50,954 limited partnership units from
Page 9 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
Notes to Consolidated Financial Statements
June 30, 1996
(Unaudited)
investors, which is a substantial discount from the estimated
value of the units. These units were cancelled resulting in
2,910,899 limited partnership units outstanding as of June 30,
1996. This gives the general partners and limited partners a
2.29% share and 97.71% share, respectively, of the Partnership's
net income or loss and distributions at June 30, 1996.
For financial reporting purposes, 2,961,853 weighted average
units were outstanding to limited partners for the three and six
months ended June 30, 1996 and 1995. Net income (loss) per unit
in 1996 and 1995 is derived by dividing 97.73% of the net income
(loss) by the weighted average number of units outstanding to the
limited partners.
Note 5. RELATED PARTY TRANSACTIONS
--------------------------
In accordance with the Limited Partnership and Property
Management Agreements, the Partnership paid Glenborough
compensation for services provided to the Partnership and
management of the Partnership's assets.
All fees and reimbursable expenses paid to Glenborough and
included in the Partnership's operating expenses for the six
months ended June 30, 1996 and 1995 are as follows (in
thousands):
Six months ended
June 30,
------------------
1996 1995
-------- --------
Property management fees $ 19 $ 54
Property management
salaries (reimbursed) 10 9
------ ------
Total property management
fees and salaries $ 29 $ 63
====== ======
The Partnership also reimbursed Glenborough for expenses incurred
for services provided to the Partnership such as accounting,
investor services, data processing, legal and administrative
services, and the actual costs of goods and materials used for or
by the Partnership. Glenborough was reimbursed $110,000 and
$145,000 for such expenses during the six months ended June 30,
1996 and 1995, respectively.
Page 10 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
Notes to Consolidated Financial Statements
June 30, 1996
(Unaudited)
Note 6. DEPOSITS
--------
Through May, 1996, the Partnership had incurred $35,000 in costs
and $500,000 in purchase deposits for the potential acquisition
of a lodging property. However, in May, 1996, the Partnership's
offer was outbid in a bankruptcy court action procedure and the
$500,000 in purchase deposits plus accrued interest was refunded
to the Partnership. Additionally, in June, 1996, the Partnership
received a net breakup fee of $52,000 which is included in other
income on the 1996 statement of operations.
Note 7. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
-------------------------------------------
GRC AIRPORT ASSOCIATES:
On September 6, 1995, the Partnership made a $1,050,000
investment in an unconsolidated joint venture, GRC Airport
Associates. The sole real estate asset of GRC Airport Associates
is a 216,000 square foot industrial warehouse in San Bruno,
California purchased in October, 1995 for $9,225,000. Since the
Partnership's 25% investment in this joint venture is less than
50% and the Partnership does not have a controlling interest, the
Partnership accounts for this joint venture on an equity method.
The Partnership recognized $34,000 of income from investment in
the unconsolidated joint venture for the six months ended June
30, 1996.
In the six months ended June 30, 1996, GRC Airport Associates
made distributions to the Partnership totaling $49,000 for the
fourth quarter 1995 and first quarter 1996 distributions. A
second quarter 1996 distribution of $26,000 was declared and paid
to the Partnership in July, 1996.
UNIVERSITY CLUB TOWER:
In 1994, the Partnership made a $1,000,000 principal payment on a
note payable on behalf of an affiliated partnership, University
Club Tower ("UCT"). The payment assisted in obtaining free and
clear title from Brazos (the previous lender) on the four
buildings acquired by Industrial (see Notes 1 and 8). Financing
for the four buildings was extremely difficult to find in the
1993/1994 market so as an inducement for the lender to finance
this release price purchase, the Partnership paid down a portion
of UCT's note payable in good faith.
In December, 1994, the Partnership and UCT agreed that the
$1,000,000 paid by the Partnership in 1994 on behalf of UCT would
be an investment in UCT. This gave the Partnership a 45% non-
voting limited partner interest, a 99% allocation of future
income and losses, and an economic interest in any future upside
Page 11 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
Notes to Consolidated Financial Statements
June 30, 1996
(Unaudited)
of this partnership, without exposure to any loss beyond any
investment by the Partnership. Under these circumstances, the
Partnership accounts for this investment in joint venture using
the equity method.
As of December 31, 1994, the general partner of UCT believed that
there was no real equity in UCT; therefore, the $1,000,000
invested in UCT in 1994 plus $58,000 in additional costs paid in
1995 on behalf of UCT were recognized as losses on investment in
joint venture in their respective years.
Note 8. INVESTMENT IN AFFILIATED PARTNERSHIPS
------------------------------------
GLENBOROUGH PROPERTIES:
As stated in Note 1, on December 31, 1995, the Partnership
contributed Industrial and its four properties to an affiliated
partnership, Properties, the operating partnership of Glenborough
Realty Trust Incorporated, a real estate investment trust managed
by affiliates of the Partnership, in exchange for 542,333 limited
partnership units in Properties. The debt securing the
properties owned by Industrial was assumed by the acquiring
partnership. The net assets contributed to the operating
partnership had a net book value of zero. Since the Partnership
does not possess significant influence over Properties and owns
units which equate to only a 13% interest in Properties, the
Partnership accounts for this investment using the cost method.
Properties paid a $162,000 first quarter 1996 distribution to the
Partnership in April, 1996. A second quarter 1996 distribution
of $166,000 was declared and paid to the Partnership in July,
1996.
GLENCO SQUAW ASSOCIATES:
In June, 1996, the Partnership purchased 111,589 units or 11% of
the units in an affiliated partnership from investors for
$299,000. Squaw is a partnership whose sole asset is an indirect
interest in a resort in Squaw Valley, California. Since the
Partnership does not posses significant influence over Squaw and
owns only an 11% interest in Squaw, the Partnership accounts for
this investment in joint venture using the cost method.
Note 9. SUBSEQUENT EVENTS
-----------------
On July 15, 1996, the Partnership contributed its 45% non-voting
limited partner interest in UCT (see Note 7) to Properties, in
exchange for 10,606 limited partnership units in Properties.
This transaction gives the Partnership a cumulative total of
552,939 units in Properties.
Page 12 of 18
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
Notes to Consolidated Financial Statements
June 30, 1996
(Unaudited)
On August 1, 1996, the Partnership purchased a $546,370
promissory note and a $1,350,000 Nuview Union School District
Credit ("School Credits") for $250,000 from an unaffiliated
partnership which is in the process of liquidation. The note
requires no accrual or payment of interest, has a ten year term
and provides for a discounted payoff of $246,000 in the first
year and is increased at increments of $30,000 in each subsequent
year through the ten year term. The School Credits are currently
under evaluation by independent certified public accountants and
if found to be valued in excess of $250,000, the Partnership will
increase its purchase price for the amount of the excess to a
maximum of $50,000. The School Credits represent prepaid property
tax assessments on specified parcels of land in the San
Bernardino Tri City area. In order for the specified parcels to
be developed, the School Credits must first be repaid to the
Partnership.
Page 13 of 18
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
INTRODUCTION
The following discussion addresses the Partnership's financial
condition at June 30, 1996 and its results of operations for the
three and six months ended June 30, 1996 and 1995. This
information should be read in conjunction with the Partnership's
December 31, 1995 Consolidated Financial Statements, notes
thereto and other information contained elsewhere in this report.
LIQUIDITY AND CAPITAL RESOURCES
On December 31, 1995, the Partnership contributed GPA Industrial,
L.P., and its four properties to an affiliated partnership,
Glenborough Properties L.P. ("Properties"), the operating
partnership of Glenborough Realty Trust Incorporated, a real
estate investment trust managed by affiliates of the Partnership,
in exchange for 542,333 limited partnership units or 13% of the
units in that partnership. The debt securing the properties
owned by GPA Industrial, L.P. was assumed by Properties. As a
result, Industrial ceased to be a subsidiary of the Partnership
at the end of 1995. The net assets contributed to Properties had
a net book value of zero. Since the Partnership does not possess
a significant influence over Properties and own units which
equate to only a 13% interest in Properties, the Partnership
accounts for this investment using the cost method.
On July 15, 1996, the Partnership contributed its 45% non-voting
limited partner interest in UCT to Properties in exchange for
10,606 units in Properties. The net investment contributed to
Properties had a net book value of zero. The contribution
increased the Partnership's investment in Properties to 552,939
limited partnership units or 14% of the outstanding units in
Properties, therefore the Partnership will continue to account
for its investment in Properties using the cost method.
Dependent upon certain events and occurrences, the Partnership s
units in Properties may in the future be converted to marketable
shares in Glenborough Realty Trust Incorporated. Properties has
made and is projected to continue to make distributions at $1.20
per limited partnership unit in 1996 which is greater than the
cash flow (after debt service payments) that the Partnership
would have received had it retained GPA Industrial L.P. and UCT.
Properties paid a $162,000 first quarter 1996 distribution to the
Partnership in April, 1996. A second quarter 1996 distribution
of $166,000 was declared and paid to the Partnership in July,
1996.
The Partnership has repurchased 50,954 units from it limited
partners at a price of $2.50 per unit, which due to the
illiquidity of the units, is a substantial discount from the
estimated value of the units. These units have been cancelled,
which provides each remaining unitholder a slightly larger
Page 14 of 18
interest in the Partnership's assets, allowing all investors to
share in the benefits from this purchase.
In June, 1996, the Partnership acquired for $299,000 ($205,000
in cash and $94,000 in short term payables), 111,589 units of
Glenco Squaw Associates ( Squaw ), an affiliated partnership
whose sole real estate asset is a limited partner interest in an
unaffiliated partnership which has an interest in a resort in
Squaw Valley, California. The general partner in Squaw has sought
and received consents from its partners for the sale of its
indirect interest in the resort, which when completed, would
provide Squaw: (i) $700,000 cash; (ii) a $2,300,000 promissory
note bearing interest at 8% per annum; (iii) additional payment
contingent upon the consideration received in excess of a stated
price related to any future sale of the resort; and (iv) any
future benefits from its disputes with its joint venture
partners.
On August 1, 1996, the Partnership purchased a $546,370
promissory note and a $1,350,000 Nuview Union School District
Credit for $250,000 from an unaffiliated partnership which is in
the process of liquidation. The note requires no accrual or
payment of interest, has a ten year term and provides for a
discounted payoff of $246,000 in the first year and is increased
at increments of $30,000 in each subsequent year through the ten
year term. The School Credits are currently under evaluation by
independent certified public accountants and if found to be
valued in excess of $250,000, the Partnership will increase its
purchase price for the amount of the excess to a maximum of
$50,000. The School Credits represents prepaid property tax
assessments on specified parcels of land in the San Bernardino
Tri-City area. In order for the specified parcels to be
developed, the School Credits must first be repaid to the
Partnership.
The Partnership's recent investments in real estate partnerships
have either generated positive cash flow for the Partnership or
have substantial upside potential. Currently, the Rosemead
property is under contract to be sold mid-August and a letter of
intent has been signed to contribute GPA Bond and its investment
in real estate into Properties for additional units in that
partnership. It is anticipated that these two transactions will
improve the Partnership's cash flow.
The Partnership's $2,200,000 debt, secured by the Rosemead
property currently requires approximately $17,000 in monthly
interest payments. This debt matured in the first quarter of
1996 but has been extended under existing terms until the
disposition of the Rosemead property is completed.
The Partnership's $1,060,000 cash and cash equivalents balance at
June 30, 1996 is believed by management to be sufficient to meet
near term operating requirements. The Partnership suspended its
distributions in 1990 in an attempt to increase liquidity and
improve its capital resources after paying for tenant and capital
improvements, leasing commissions, refinancing costs, and
Page 15 of 18
increasing debt service payments. As of August 12, 1996,
distributions remain suspended and management is unable to
predict when they may be resumed.
RESULTS OF OPERATIONS
Rental revenues decreased $1,125,000 during the three and six
months ended June 30, 1996 to $385,000 compared to the three and
six months ended June 30, 1995 amount of $1,510,000 due to the
contribution of GPA Industrial and its four properties into an
affiliated partnership at December 31, 1995, as discussed above.
This transaction resulted in the recognition of income from
investment in affiliated partnerships during the three and six
months ended June 30, 1996 of $162,000.
Interest and other revenue increased during the three months
ended June 30, 1996 over the three months ended June 30, 1995 due
to prior year property tax refunds received in the second quarter
of 1996 for Rosemead. Despite the increase during the three
months ended June 30, 1996, interest and other revenue during the
six months ended June 30, 1996 remained comparable to the six
months ended June 30, 1995 due to the recognition in 1995 of
other income as a result of loan fees received by the Partnership
for short-term loans made to unaffiliated partnerships in 1995.
Operating, general and administrative, depreciation and
amortization and interest expenses decreased during the three and
six months ended June 30, 1996 compared to the same periods in
1995 due again to the contribution of GPA Industrial and its
related properties along with its debt to Properties.
Page 16 of 18
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Partnership is not a party to, nor any of its
assets the subject of any material pending legal
proceedings.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 6. Exhibits and Reports on Form 8-K
(b) Reports on Form 8-K.
No reports on Form 8-K were required to be filed during
this reporting period.
Page 17 of 18
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:
GLENBOROUGH PARTNERS,
A CALIFORNIA LIMITED PARTNERSHIP
By: /s/ Robert Batinovich By: Glenborough Corporation,
Robert Batinovich a California corporation,
General Partner (formerly known as
Glenborough Realty Corporation)
its Managing General Partner
By: /s/ Andrew Batinovich
Andrew Batinovich
Chief Executive Officer
and Chairman of the Board
By: /s/ Terri Garnick
Terri Garnick
Chief Financial Officer
Date: August 13, 1996
Page 18 of 18
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 1060
<SECURITIES> 0
<RECEIVABLES> 26
<ALLOWANCES> 0
<INVENTORY> 4315
<CURRENT-ASSETS> 1086
<PP&E> 3264
<DEPRECIATION> 114
<TOTAL-ASSETS> 9984
<CURRENT-LIABILITIES> 197
<BONDS> 5022
0
0
<COMMON> 0
<OTHER-SE> 4630
<TOTAL-LIABILITY-AND-EQUITY> 9984
<SALES> 0
<TOTAL-REVENUES> 823
<CGS> 0
<TOTAL-COSTS> 301
<OTHER-EXPENSES> 154
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 235
<INCOME-PRETAX> 78
<INCOME-TAX> 0
<INCOME-CONTINUING> 78
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 78
<EPS-PRIMARY> .03
<EPS-DILUTED> .03
</TABLE>
