<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended September 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 0-16857
Brauvin Income Properties L.P. 6
(Exact name of small business issuer as specified
in its charter)
Delaware 36-1276801
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
150 South Wacker Drive, Chicago, Illinois 60606
(Address of principal executive offices) (Zip Code)
(312) 443-0922
(Issuer's telephone number, including area code)
(Former name, former address and former fiscal year, if
changed since last report)
Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act during the
past 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>
INDEX
Page
PART I Financial Information
Item 1. Financial Statements . . . . . . . . . . . . . . . . . . . . . 3
Balance Sheet at September 30, 1996. . . . . . . . . . . . . . 4
Statements of Operations for the Nine Months
Ended September 30, 1996 and 1995. . . . . . . . . . . . . . . 5
Statements of Operations for the Three Months
Ended September 30, 1996 and 1995. . . . . . . . . . . . . . . 6
Statements of Cash Flows for the Nine Months
Ended September 30, 1996 and 1995. . . . . . . . . . . . . . . 7
Notes to Financial Statements. . . . . . . . . . . . . . . . . 8
Item 2. Management's Discussion and Analysis or Plan
of Operation . . . . . . . . . . . . . . . . . . . . . . . . . 10
PART II Other Information
Item 1. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . . . 14
Item 2. Changes in Securities. . . . . . . . . . . . . . . . . . . . . 14
Item 3. Defaults Upon Senior Securities. . . . . . . . . . . . . . . . 14
Item 4. Submission of Matters to a Vote of Security
Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Item 5. Other Information. . . . . . . . . . . . . . . . . . . . . . . 14
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . 14
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
The following Balance Sheet as of September 30, 1996, Statements of
Operations for the nine and three months ended September 30, 1996
and 1995 and Statements of Cash Flows for the nine months ended
September 30, 1996 and 1995 for Brauvin Income Properties L.P. 6
(the "Partnership") are unaudited but reflect, in the opinion of
the management, all adjustments necessary to present fairly the
information required. All such adjustments are of a normal
recurring nature.
These financial statements should be read in conjunction with the
financial statements and notes thereto included in the
Partnership's 1995 Annual Report on Form 10-K.
<PAGE>
BALANCE SHEET
September 30, 1996
(Unaudited)
ASSETS
Cash and cash equivalents $ 623,375
Tenant receivables (net of allowance of $13,171) 216,300
Escrow deposits 420,409
Other assets 173,379
1,433,463
Investment in real estate, at cost:
Land 2,756,651
Buildings 10,667,828
13,424,479
Less: Accumulated depreciation (2,982,080)
Total investment in real estate, net 10,442,399
Total Assets $11,875,862
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Accounts payable and accrued expenses $ 201,678
Security deposits 5,583
Mortgages payable 8,853,051
Total Liabilities 9,060,312
Partners' Capital
General Partners 9,037
Limited Partners (7,842.5 limited partnership
units issued and outstanding) 2,806,513
Total Partners' Capital 2,815,550
Total Liabilities and Partners' Capital $11,875,862
See notes to financial statements (unaudited).
<PAGE>
STATEMENTS OF OPERATIONS
For the Nine Months Ended September 30, 1996 and 1995
(Unaudited)
1996 1995
INCOME
Rental $1,376,661 $1,369,843
Interest 25,852 43,641
Other, primarily tenant expense
reimbursements 288,210 281,355
Total income 1,690,723 1,694,839
EXPENSES
Interest 650,798 706,400
Depreciation 282,271 277,704
Real estate taxes 100,377 100,009
Repairs and maintenance 21,092 41,075
Operating 278,266 237,213
General and administrative 189,275 330,175
Total expenses 1,522,079 1,692,576
Equity in net income from
affiliated joint venture -- 231,115
Net Income $ 168,644 $ 233,378
Net Income Per Limited Partnership
Interest (7,842.5 Units) $ 21.29 $ 29.46
See notes to financial statements (unaudited).
<PAGE>
STATEMENTS OF OPERATIONS
For the Three Months Ended September 30, 1996 and 1995
(Unaudited)
1996 1995
INCOME
Rental $504,213 $461,396
Interest 9,722 16,519
Other, primarily tenant expense
reimbursements 84,696 104,316
Total income 598,631 582,231
EXPENSES
Interest 215,907 219,595
Depreciation 94,014 91,837
Real estate taxes 33,117 35,209
Repairs and maintenance 5,998 28,560
Operating 83,738 59,821
General and administrative 55,657 196,520
Total expenses 488,431 631,542
Net Income(Loss) $110,200 $(49,311)
Net Income(Loss)Per Limited Partnership
Interest (7,842.5 Units) $ 13.91 $ (6.22)
See notes to financial statements (unaudited).
<PAGE>
STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 1996 and 1995
(Unaudited)
1996 1995
Cash Flows From Operating Activities:
Net income $168,644 $ 233,378
Adjustments to reconcile net income to net
cash provided by operating activities:
Equity in net income from affiliated
joint venture -- (231,115)
Provision for doubtful accounts 13,736 1,350
Depreciation 282,271 277,704
Normalized rental revenue 7,614 7,612
Changes in operating assets and liabilities:
Decrease in tenant receivables, net 69,187 35,922
Decrease (increase) in escrow deposits 687 (316,172)
(Increase) decrease in other assets (1,109) 31,851
Decrease in due from affiliates 730 23,711
(Decrease) increase in accounts
payable and accrued expenses (69,428) 107,860
Decrease in security deposits -- (1,164)
Net cash provided by operating activities 472,332 170,937
Cash Flows From Investing Activities:
Capital expenditures (14,027) (1,573)
Cash used in investing activities (14,027) (1,573)
Cash Flows From Financing Activities:
Repayment of mortgages (109,583) (4,761,446)
Proceeds from refinancing -- 6,100,000
Loan fees -- (157,953)
Return of capital -- (999,919)
Cash distributions to Limited Partners (286,826) (142,438)
Net cash (used in) provided by financing
activities (396,409) 38,244
Net increase in cash and cash equivalents 61,896 207,608
Cash and cash equivalents
at beginning of period 561,479 445,771
Cash and cash equivalents at end of period $ 623,375 $ 653,379
See notes to financial statements (unaudited).
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(1) BASIS OF PRESENTATION
The accompanying unaudited financial statements have been
prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Form 10-QSB and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating
results for the nine month period ended September 30, 1996 are not
necessarily indicative of the results that may be expected for the
year ended December 31, 1996. For further information, refer to
the financial statements and footnotes thereto included in the
Annual Report on Form 10-K for the year ended December 31, 1995.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Reclassifications
Certain amounts in the 1995 financial statements have been
reclassified to conform to the 1996 presentation. This has not
affected the previously reported results of operations.
(3) TRANSACTIONS WITH AFFILIATES
Fees and other expenses paid to the General Partners or their
affiliates for the nine months ended September 30, 1996 and 1995,
were as follows:
1996 1995
Management fees $112,976 $109,548
Reimbursable office expenses 57,851 62,280
Legal fees 679 7,355
The Partnership believes the amounts paid to affiliates are
representative of amounts which would have been paid to independent
parties for similar services. The Partnership had made all
payments to affiliates, except for $1,076 and $1,526 for legal
services, as of September 30, 1996 and 1995, respectively.
(4) DELCHAMPS' MORTGAGE PAYABLE
The Delchamps' mortgage loan matures on December 1, 1996. The
General Partners are currently working with third party lenders to
refinance this loan when it matures. There is no assurance that
the General Partners will be successful in their refinancing
efforts in which case the Partnership would sustain a loss upon
foreclosure.
(5) SUBSEQUENT EVENTS
A cash distribution for the quarter ending September 30, 1996,
will be paid to Limited Partners on November 15, 1996, in the
aggregate amount of $86,236.
<PAGE>
ITEM 2. Management's Discussion and Analysis or Plan of
Operation.
Liquidity and Capital Resources
The Partnership intends to satisfy its short-term liquidity
needs through cash flow from the properties. Long-term liquidity
needs are expected to be satisfied through modification of the
mortgages at more favorable interest rates.
The occupancy level at Delchamps at September 30, 1996,
December 31, 1995 and September 30, 1995 was 100%. Delchamps
operated at a positive cash flow for the nine months ended
September 30, 1996. The Delchamps' mortgage loan matures on
December 1, 1996. The General Partners are currently working with
third party lenders to refinance this loan when it matures. There
is no assurance that the General Partners will be successful in
their refinancing efforts in which case the Partnership would
sustain a loss upon foreclosure.
Shoppes operated at a positive cash flow for the nine months
ended September 30, 1996. The occupancy level at Shoppes at
September 30, 1996 and December 31, 1995 was 97% compared to 98% at
September 30, 1995.
Ponderosa operated at a positive cash flow for the nine months
ended September 30, 1996.
A distribution of Operating Cash Flow for the third quarter of
1996 will be made to the Limited Partners on November 15, 1996 in
the amount of $86,236. The Preferential Distribution Deficiency
will equal $3,669,695 after this next distribution, a $178,890
increase over the December 31, 1995 balance of $3,490,805.
The General Partners of the Partnership expect to distribute
proceeds from operations, if any, and from the sale of real estate,
to Limited Partners in a manner that is consistent with the
investment objectives of the Partnership. Management of the
Partnership believes that cash needs may arise from time to time
which will have the effect of reducing distributions to Limited
Partners to amounts less than would be available from refinancings
or sale proceeds. These cash needs include, among other things,
maintenance of working capital reserves in compliance with the
partnership agreement as well as payments for major repairs, tenant
improvements and leasing commissions in support of real estate
operations.
Results of Operations-Nine Months Ended September 30, 1996 and 1995
(Amounts rounded to 000's)
The Partnership generated net income of $169,000 for the nine
months ended September 30, 1996 as compared to net income of
$233,000 for the same nine month period in 1995. The $64,000
decrease in net income resulted primarily from a $231,000 decrease
in the Partnership's share of the Annex income due to its
foreclosure on May 15, 1995 which was offset by a $171,000 decrease
in total expenses.
Total income for the nine months ended September 30, 1996 was
$1,691,000 as compared to $1,695,000 for the same nine month period
in 1995, a decrease of $4,000. The $4,000 decrease in total income
resulted primarily from a $18,000 decrease in interest income which
was offset by a $7,000 increase in rental income and a $7,000
increase in tenant expense reimbursements. The $18,000 decrease in
interest income was a result of the decrease in short-term
investments. The decrease in short-term investments was due to the
August 1995 distribution to Investors of the excess funds from the
Shoppes refinancing. The $7,000 increase in rental income was
mainly due to a $8,000 increase in rental income at Shoppes. The
$8,000 rental income increase at Shoppes was due to a increase in
base rent of $18,000 which was offset by a decrease in percentage
rent of $10,000. The $18,000 in base rent was a result of
increased rental rates implemented in 1996. Percentage rent for
Shoppes decreased $10,000 for the nine months ended September 30,
1996 as compared to the nine months ended September 30, 1995 as a
result of a $15,000 percentage rent adjustment for 1995 made in
1996. The $7,000 increase in tenant expense reimbursements was due
to a $12,000 increase in tenant expense reimbursements at Delchamps
for the nine months ended September 30, 1996 as compared to the
nine months ended September 30, 1995. The $12,000 increase at
Delchamps was due to a change in estimated amounts expected to be
received in 1996.
For the nine months ended September 30, 1996 total expenses
were $1,522,000 as compared to $1,693,000 for the same nine month
period in 1995, a decrease of $171,000. The decrease of $171,000
in total expenses is due primarily to a decrease in general and
administrative expense of $141,000 and a $56,000 decrease in
interest expense. The $141,000 decrease in general and
administrative expense was mainly attributed to the decrease in
legal fees of $134,000 for the nine months ended September 30, 1996
when compared to the same period in 1995. The decrease in legal
fees was mainly contributed to the Annex's bankruptcy legal fees of
$127,000 which incurred in 1995. Interest expense decreased
$56,000 for the nine months ended September 30, 1996 when compared
to the nine months ended September 30, 1995 as a result of the
Shoppes interest rate increasing to a default rate during the four
month extension of the mortgage in 1995. Repairs and maintenance
decreased $20,000 as a result of parking lot repairs decreasing
$14,000 for Delchamps for the nine month period ending September
30, 1996 when compared to the same nine period in 1995. These
decreases were offset by an increase in operating expenses of
$41,000 due primarily to an increase of $28,000 for landscaping
relating to irrigation and site preparation at Shoppes.
Results of Operations-Three Months Ended September 30, 1996 and
1995 (Amounts rounded to 000's)
The Partnership generated net income of $110,000 for the three
months ended September 30, 1996 as compared to net loss of $49,000
for the same three month period in 1995, an increase in net income
of $159,000. This $159,000 increase in net income was a result of
total income increasing $16,000 and total expenses decreasing
$143,000.
Total income for the three months ended September 30, 1996 was
$598,000 as compared to $582,000 for the same three month period in
1995, an increase of $16,000. This $16,000 increase in total
income was primarily due do a $43,000 increase in rental income
which was offset by a $20,000 decrease in tenant expense
reimbursements. Rental income increased $43,000 as a result of
Shoppes percentage rent increasing $36,000 for the three month
period ending September 30, 1996 when compared to the same three
month period in 1995. Shoppes' percentage rent increased $36,000
due to a change in estimated amounts expected to be received in
1996. Tenant expense reimbursements decreased $20,000 as a result
of a $9,000 decrease at Delchamps and a $10,000 decrease at
Shoppes. The $10,000 decrease in tenant expense reimbursements was
due to a one time charge for utility reimbursements in 1995. The
$9,000 decrease in tenant expense reimbursements for Delchamps was
result of a change in estimated amounts expected to be received in
1996.
For the three months ended September 30, 1996 total expenses
were $488,000 as compared to $631,000 for the same three month
period in 1995, a decrease of $143,000. The $143,000 decrease in
total expenses was primarily due to a $141,000 decrease in general
and administrative expenses which was mainly attributed to the
decrease in legal fees of $127,000 for the three months ended
September 30, 1996 when compared to the same period in 1995. The
decrease in legal fees was mainly contributed to the Annex's
bankruptcy legal fees of $127,000 paid in 1995. Repairs and
maintenance decreased $23,000 for the three months ended September
30, 1996 as compared to the three months ended September 30, 1995
but was offset by a $24,000 increase in operating expenses.
Repairs and maintenance decreased $23,000 mainly due to parking lot
repairs decreasing $15,000 at Delchamps. Operating expenses
increased $24,000 due to an $18,000 increase in operating expenses
at Shoppes. The $18,000 increase in operating expenses at Shoppes
was due primarily to a $5,000 increase in janitorial cleaning, a
$6,000 increase in landscaping and a $5,000 increase in
electricity. Landscaping increased $6,000 due to tree trimming
required during the three months ended September 30, 1996 and
electricity increased $5,000 due to a $4,000 refund received during
the three month period ending September 30, 1995.
<PAGE>
PART II - OTHER INFORMATION
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 Information.
None.
ITEM 6. Exhibits and Reports On Form 8-K.
Exhibit 27. Financial Data Schedule
<PAGE>
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.
BY: Brauvin 6, Inc.
Corporate General Partner of
Brauvin Income Properties L.P. 6
BY: /s/ Jerome J. Brault
Jerome J. Brault
Chairman of the Board of
Directors and President
DATE: November 13, 1996
BY: /s/ B. Allen Aynessazian
B. Allen Aynessazian
Chief Financial Officer
and Treasurer
DATE: November 13, 1996
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 623,375
<SECURITIES> 0
<RECEIVABLES> 216,300
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 13,424,479 <F1>
<DEPRECIATION> 2,982,080
<TOTAL-ASSETS> 11,875,862
<CURRENT-LIABILITIES> 0
<BONDS> 8,853,051 <F2>
0
0
<COMMON> 2,815,550 <F3>
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 11,875,862
<SALES> 0
<TOTAL-REVENUES> 1,690,723 <F4>
<CGS> 0
<TOTAL-COSTS> 1,522,079 <F5>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 650,798
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 168,644
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> "PP&E" REPRESENTS INVESTMENT IN REAL ESTATE
<F2> "BONDS" REPRESENTS MORTGAGES PAYABLE
<F3> "COMMON" REPRESENTS TOTAL PARTNERS' CAPITAL
<F4> "TOTAL REVENUES" REPRESENTS RENTAL, INTEREST, AND OTHER
INCOME
<F5> "TOTAL COSTS" REPRESENTS TOTAL EXPENSES
</FN>
</TABLE>
