UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR PERIOD ENDING JUNE 30, 1996
Commission File Number: 33-04345
Exact name of Registrant as specified in its charter:
Florida Income Fund II, Limited Partnership
State or other Jurisdiction of incorporation or organization:
Ohio
I.R.S. Employer Identification Number: 33-1168320
Address of Principal Executive Offices:
12800 University Drive, Ste 675
Fort Myers, FL 33907
Registrant's Telephone Number, including Area Code:
(941) 481-2011
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
The registrant 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 has been subject
to such filing requirements for the past 90 days.
PAGE 1<PAGE>
FLORIDA INCOME FUND II, L.P.
INDEX
PAGE NO.
PART I - FINANCIAL INFORMATION
Balance Sheets at June 30 1996
and December 31, 1995 . . . . . . . . . . . . . . . . . . .3
Statements of Income for the Six
Months Ended June 30, 1996 and 1995 . . . . . . . . . . . .4
Statements of Cash Flows for the Three and Six
Months Ended June 30, 1996 and 1995 . . . . . . . . . . . .5
Notes to Financial Statements . . . . . . . . . . . . . . .6
Management's Discussion and Analysis of
Financial Condition and Results of Operations . . . . . .6-8
PART II - OTHER INFORMATION
Items 1-6 . . . . . . . . . . . . . . . . . . . . . . . . .9
PART III - SIGNATURES. . . . . . . . . . . . . . . . . . . . . 10
COVER LETTER
EXHIBIT 27 - Financial Data Schedule
EXHIBIT 99 - Form 8-K
PAGE 2<PAGE>
<PAGE>
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
BALANCE SHEETS
(Unaudited)
June 30, Dec. 31,
1996 1995
___________ ___________
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash 1,624,418 147,521
A/R Trade, Net of allowance for 76,541 65,238
doubtful accounts of $46,442
for June 30, 1996 and $38,181
for December 31, 1995)
Notes Receivable 38,449 52,854
Prepaid Expenses and Other 190,806 132,608
___________ ___________
Total Current Assets 1,930,214 398,221
RENTAL PROPERTIES, NET OF ACCUMULATED
DEPRECIATION OF $3,846,214 AT JUNE 30
1996 AND $4,048,938 AT DEC 31, 1995 14,225,889 15,984,294
INTANGIBLE ASSETS
Deferred Loan Costs, Net 24,323 46,425
__________ __________
TOTAL ASSETS 16,180,426 16,428,940
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES
Current Maturities of Notes
and Mortgages Payable 7,441,311 8,116,010
Accounts Payable 8,124 86,330
Accrued Expenses 152,307 86,724
Customer & Security Deposits 160,497 182,480
Deposit on Sale 130,000 -0-
___________ ___________
TOTAL CURRENT LIABILITIES 7,892,239 8,471,544
NOTES AND MORTGAGES PAYABLE 2,479,771 2,480,347
PARTNERS' CAPITAL
General Partners' Capital (182,156) (173,745)
Limited Partners' Capital 5,490,997 5,650,794
Net Income 499,575 -0-
___________ ___________
TOTAL PARTNERS' EQUITY 5,808,416 5,477,049
TOTAL LIABILITIES
AND PARTNERS' CAPITAL 16,180,426 16,428,940
</TABLE>
See Accompanying Notes to the Financial Statements
PAGE 3<PAGE>
<PAGE>
<TABLE>
<CAPTION>
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
STATEMENTS OF INCOME
(Unaudited)
For Three Months Ended For Six Months Ended
06/30/96 06/30/95 06/30/96 06/30/95
________ ________ ________ ________
<S> <C> <C> <C> <C>
REVENUES:
Sales Proceeds -0- -0- 1,950,000 -0-
Rental Income 670,692 750,728 1,341,046 1,483,055
Interest Income 25,596 798 26,422 2,034
_______ _______ _________ _________
Total Revenues 696,288 751,526 3,317,468 1,485,089
EXPENSES:
Cost of Sales and
Closing Costs -0- -0- 1,601,791 -0-
Property Operating
Expenses 130,029 223,573 379,215 471,893
Real Estate Taxes 50,571 55,089 101,142 110,178
Interest Expense 249,098 253,936 478,229 507,172
Depreciation 118,308 133,699 236,616 267,398
Amortization 9,883 14,738 20,900 29,475
_______ _______ _________ _________
Total Expenses 557,889 681,035 2,817,893 1,386,116
NET INCOME 138,399 70,491 499,575 98,973
</TABLE>
See accompanying Notes to the Financial Statements
PAGE 4<PAGE>
<PAGE>
<TABLE>
<CAPTION>
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
(Unaudited)
For Six Months Ended
06/30/96 06/30/95
__________ ________
<S> <C> <C>
Cash Flows From Operating Activities:
Net Income 499,575 98,973
Adjustments to reconcile net income
to net cash provided by operations:
Depreciation & Amortization 257,516 296,873
Cost of Sales 1,517,585 -0-
(Increase) decrease in receivables 3,102 ( 20,560)
(Increase) decrease in prepaid
expenses and other ( 58,198) ( 57,064)
Increase (decrease) accounts payable
and accrued expenses ( 11,422) ( 35,231)
Increase (decrease) in customer
and security deposits ( 21,983) ( 12,254)
Net cash flow provided by operating ___________ _________
activities 2,186,175 270,737
Cash flows from investing activities:
Improvements to rental properties -0- (115,366)
___________ _________
Net cash used in investing activities -0- (115,366)
Cash flows from financing activities:
Repayments of long-term borrowings ( 675,275) (111,681)
Partner distribution paid ( 164,003) (111,980)
Deposit on Sale 130,000 -0-
___________ _________
Net cash flows used by financing activities ( 709,278) (223,661)
Net increase (decrease) in cash (1,476,897) ( 68,290)
Cash at beginning of year 147,521 93,321
Cash at June 30 1,624,418 25,031
</TABLE>
See accompanying Notes to the Financial Statements
PAGE 5<PAGE>
<PAGE>
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying financial statements have been prepared in
accordance with the instructions to Form 10-Q and therefore do not
include all disclosures necessary for fair presentation of the
Partnership's financial position, results of operations and
statements of cash flows in conformity with generally accepted
accounting principles, as set forth in the Partnership's Form 10-K
for the period ended December 31, 1995, or any other interim
period. In management's opinion, all adjustments have been made to
the financial statements necessary for a fair presentation of the
interim periods presented.
NOTE 2 - RELATED PARTY TRANSACTIONS
During the three month period ended June 30, 1996, and June 30,
1995, the Partnership incurred $21,328 and $41,959 in property
management fees paid to Mariner Capital Management, Inc., the
Managing General Partner, in accordance with the Partnership
Agreement. These expenses are included in property expenses. The
General Partners and their affiliates are also entitled to
reimbursement of costs (including amounts of any salaries paid to
employees or its affiliates) directly attributable to the operation
of the Partnership that could have been provided by independent
parties. Costs amounting to $7,800 were incurred during the second
quarter of 1996. This compares to $70,603 of costs that were
incurred during the second quarter of 1995.
NOTE 3 - BALANCE SHEET
The Balance Sheet at December 31, 1995, has been taken from the
audited Financial Statements at that date.
NOTE 4 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION RESULTS OF OPERATIONS
Liquidity
The Partnership's cash position, including interest bearing
deposits at June 30, 1996, was $1,624,418. This compares to its
cash position of $147,521 at December 31, 1995. At June 30, 1995,
the Partnership's cash position, including interest bearing
deposits, was $25,031.
PAGE 6<PAGE>
<PAGE>
Liquidity - Continued
The increase in cash between December 31, 1995, and June 30, 1996,
was due primarily to cash provided by operations of $2,186,175,
which includes the sale of Heritage Square Shopping Center on Marco
Island as previously reported in an 8-K filed on January 26, 1996,
principal repayments of $675,275 and partnership distributions paid
of $164,003.
The Partnership's total investment in properties for its portfolio
at June 30, 1996, was $18,072,103. This compares to its total
property investment at December 31, 1995, of $20,033,232 and
$20,005,200 at June 30, 1995. This decline resulted primarily from
the sale of Heritage Square Shopping Center.
The sale of Town Center Shopping Center, reported in an 8-K filed
July 1, 1996 will result in a material reduction in both
partnership assets, partnership debt and partnership liquidity.
Other than as discussed herein, there are no known trends, demands,
commitments, events or uncertainties that in management's opinion
will result or are reasonably likely to result in the registrant's
liquidity increasing or decreasing in any material way.
Capital Resources
The Partnership's outstanding debt as of June 30, 1996, was
$9,921,082. This compares to debt outstanding December 31, 1995,
of $10,596,357. The $675,275 decrease during the first six months
was due primarily to repayment of a loan balance of $597,000 from
proceeds of the sale of Heritage Square Shopping Center. The
Partnership had $10,704,845 of outstanding debt at June 30, 1995.
The sale of Town Center Shopping Center occurred after June 30,
1996 and the results of that sale are not reflected on the
financial data being reported herein. However, items (a) and (b)
below occurred in July 1996 as a result of that sale and are
considered significant.
(a) The Partnership had a loan in the amount of $1,665,137
with a maturity date of September 1, 1996. This loan
was secured by a first mortgage on Manatee West.
Management satisfied this obligation with $1,200,000
of cash reserves and approximately $465,000 from the
proceeds of the sale of Town Center Shopping Center.
PAGE 7
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<PAGE>
(b) The Partnership had a loan which came due in September
1996 in the amount of $5,764,174. The loan was
secured by a first mortgage on Town Center and
Broadway Medical Center. Management satisfied this
obligation with the proceeds from the sale of Town
Center.
Results of Operations
As of June 30, 1996, the occupancy percentages for the Fund's
properties were as follows: Broadway Medical Center, 67%, Marco
Town Center Mall, 83%, Manatee West Shopping Center, 68%, and
Pinebrook Commons, 85%.
For the six months ended June 30, 1996, rental income decreased
$142,009 as compared to the same period a year ago. The decrease
was attributable to selling Heritage Square during the three months
ended March 31, 1996, and increased vacancies in other assets as
compared to the same period one year ago.
For the six months ended June 30, 1996, interest income increased
by $24,388 compared to the same period one year ago.
Property expenses decreased by $92,678 from a year ago primarily
due to the sale of Heritage Square.
Real estate taxes have decreased to reflect anticipated assessments
for the year and the decrease due to the sale of Heritage Square.
Interest expense has decreased $28,943 for the six month period
ended June 30, 1996, as compared to a year ago. This decrease is
due to the partnership's debt decreasing from $10,596,357 at
December 31, 1995, to $9,921,082 as of June 30, 1996. The
partnership's debt as of June 30, 1995, was $10,704,845.
Depreciation and amortization have decreased $39,357 due to some
costs being fully amortized in 1995.
PAGE 8<PAGE>
<PAGE>
PART II
OTHER INFORMATION
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER MATERIALLY IMPORTANT EVENTS
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS
27 - Financial Data Schedule
99 - Form 8-K
(B) REPORTS ON FORM 8-K
None
PAGE 9<PAGE>
<PAGE>
PART III
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.
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
MARINER CAPITAL MANAGEMENT, INC.
MANAGING GENERAL PARTNER
(Registrant)
8/5/96 Lawrence A. Raimondi
President and Director, and CEO
Mariner Capital Management, Inc.
(Principal Executive Officer)
(SIGNATURE)
8/5/96 Joe K. Blacketer
Secretary/Treasurer
Mariner Capital Management, Inc.
(Principal Financial and
Accounting Officer)
(SIGNATURE)
PAGE 10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 1,624,418
<SECURITIES> 0
<RECEIVABLES> 161,432
<ALLOWANCES> 46,442
<INVENTORY> 0
<CURRENT-ASSETS> 1,930,214
<PP&E> 18,072,103
<DEPRECIATION> 3,846,214
<TOTAL-ASSETS> 16,180,426
<CURRENT-LIABILITIES> 7,892,239
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 16,180,426
<SALES> 3,291,046
<TOTAL-REVENUES> 3,317,468
<CGS> 1,601,791
<TOTAL-COSTS> 1,601,791
<OTHER-EXPENSES> 737,873
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 478,229
<INCOME-PRETAX> 499,575
<INCOME-TAX> 0
<INCOME-CONTINUING> 151,366
<DISCONTINUED> 348,209
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 499,575
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
EXHIBIT 99
FORM 8-K
SALE OF TOWN CENTER SHOPPING CENTER
TABLE OF CONTENTS
ITEM 2
ACQUISITION OR DISPOSITION OF ASSETS
ITEM 5
HISTORICAL SUMMARY OF GROSS REVENUES AND
CERTAIN DIRECT OPERATING EXPENSES
SELLERS CLOSING STATEMENT
SIGNATURES
Page 1<PAGE>
<PAGE>
ITEM 2 - FORM 8-K
ACQUISITION OR DISPOSITION OF ASSETS
SALE OF TOWN CENTER SHOPPING CENTER
The partnership sold Town Center, the 101,664 sq. ft. shopping
center located on Marco Island to American Heritage/Buckhead, L.P.
a Delaware limited partnership, on July 1, 1996 at a price of
$12,000,000.
Closing costs totaled $378,000 which included a selling commission
of $240,000 split equally between two unrelated, third party real
estate brokerage companies. Additional closing adjustments totaled
$130,000. A copy of the Seller's Closing Statement is attached.
From the closing proceeds, the partnership paid in full a first
mortgage loan from NationsBank in the amount of $5,764,000. That
loan was secured by a mortgage on both Town Center and Broadway
Medical Center. That mortgage has now been satisfied in full. An
additional $500,000 is being reserved from the closing to be paid
against the partnership's loan on Manatee West. That sum, plus
approximately $1,200,000 which was reserved from a prior property
sale will pay the loan on Manatee West Shopping Center in full
provided that the lender will not grant a satisfactory extension to
that loan which is due and payable on September 1, 1996.
The net proceeds from sale less the $500,000 mentioned above will
be distributed to the limited partners during the last week of June
or first week of July.
Pursuant to the information required by Article 11 of regulation
S-X, if the partnership had disposed of the property on March 31,
1996, the effect on the partnership's unaudited balance sheet of
that same date would have been a decrease in net asset value of
$1,430,000, a decrease in debt by $5,782,000, and a higher net
worth of approximately $4,352,000.
If this sale had occurred on January 1, 1996, the effect on the
unaudited income statement for three months ended March 31, 1996
would have been to decrease revenue by $378,000, decrease operating
expense by $91,000, decrease interest expense by $136,000, decrease
other non-operating expenses by $16,000, decrease depreciation and
amortization expenses by $70,000. All of the foregoing adjustment
would have resulted in a decrease in net income of $65,000.
Included in this report is the historical summary of gross revenues
and certain direct operating expenses for the twelve months ending
12/31/95, 12/31/94 and 12/31/93.
Page 2<PAGE>
<PAGE>
<TABLE>
<CAPTION> TOWN CENTER SHOPPING CENTER
HISTORICAL SUMMARY OF GROSS REVENUES AND
CERTAIN DIRECT OPERATING EXPENSES
12/31/95 12/31/94 12/31/93
<S> <C> <C> <C>
GROSS REVENUES
Rental Income
and other 1,499,190 1,603,837 1,701,092
Total Revenue 1,499,190 1,603,837 1,701,092
CERTAIN DIRECT
OPERATING EXPENSES
Grounds Maintenance 41,580 37,054 33,937
Building Maintenance 45,338 19,362 7,484
Utilities 55,950 54,023 41,267
Management Fee 92,272 91,215 100,540
Real Estate Taxes 77,730 80,095 80,361
Insurance 55,864 58,574 49,733
Administrative 64,384 84,767 76,574
Other Expenses 64,143 41,442 60,505
Bad Debts 0 0 51,800
_________ _________ _________
TOTAL CERTAIN DIRECT 497,261 466,532 502,201
OPERATING EXPENSES
EXCESS OF GROSS 1,001,929 1,137,305 1,198,891
REVENUES OVER CERTAIN
DIRECT OPERATING
EXPENSES
</TABLE>
Page 3<PAGE>
<PAGE>
SELLER'S CLOSING STATEMENT
Seller: Florida Income Fund II, Limited Partnership
Buyer: American Heritage/Buckhead, L.P.
Property: Town Center Shopping Center, Marco Island, Florida
Date of Closing: July 1, 1996.
Purchase Price: $12,000,000.00
EXPENSES:
1. Owner's Title Insurance $ 36,575.00
2. Documentary Stamps on Deed $ 84,000.00
3. Title Search $ 650.00
4. 1996 Real Estate Taxes,
prorated (1/1-6/27/96 $ 37,751.09
5. 1996 Personal Property Taxes,
prorated (1/1-6/27/96) $ N/A
6. Rents, prorated (6/27-6/30/96)
(excluding Fleming) $ 12,974.11
7. Seller's Attorney Fee payable to
Norman A. Hartman, Jr., P.A. $ 14,750.00
8. Copies, postage, Federal Express,
facsimile, long distance
calls (est) $ 225.00
9. NationsBank Mortgage
Payoff (6/27/96) $5,794,961.76
10. Recording of Affidavits of
Partnership $ 30.00
11. Rent Credit to Buyer for Fleming $ 909.10
12. Deposit from Buyer $ 100,000.00
13. Real Estate Commission $ 240,000.00
14. Security Deposits $ 90,575.72
15. Prepaid Rent (Aslan Cleaners) $ 1,757.50
_____________
TOTAL EXPENSES $6,415,159.28
PURCHASE PRICE LESS EXPENSES: $5,584,840.72
CREDITS:
1. Unpaid June Rents $ 14,062.30
_____________
TOTAL CREDITS $ 14,062.30
PURCHASE PRICE LESS EXPENSES PLUS CREDITS: $5,598,903.02
Page 4<PAGE>
<PAGE>
I HEREBY CERTIFY THE ABOVE TO BE TRUE AND CORRECT:
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
BY: MARINER CAPITAL MANAGEMENT, INC. a Florida Corporation, its
Managing General Partner
BY: LAWRENCE A. RAIMONDI FEDERAL TAX ID NO. 31-1168320
PRESIDENT
(SIGNATURE)
CORPORATE SEAL
(SEAL)
Page 5
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<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) 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.
FLORIDA INCOME FUND II, LIMITED PARTNERSHIP
(REGISTRANT)
JULY 1, 1996
LAWRENCE A. RAIMONDI
PRESIDENT AND DIRECTOR, AND CEO
MARINER CAPITAL MANAGEMENT, INC.
(PRINCIPAL EXECUTIVE OFFICER)
(SIGNATURE)
JOE K. BLACKETER
SECRETARY/TREASURER
MARINER CAPITAL MANAGEMENT, INC.
(PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER)
(SIGNATURE)
Page 6
