FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities exchange Act of 1934
For the Quarterly Period Ended March 31, 1999
Commission File Number 0-16815
NHP RETIREMENT HOUSING PARTNERS I
LIMITED PARTNERSHIP
(A Delaware Limited Partnership)
(Exact name of registrant as specified in its charter)
DELAWARE 52-1453513
(State of other jurisdiction of incorporation or (I.R.S. Employer
organization) Identification No.)
14160 DALLAS PARKWAY, SUITE 300
DALLAS, TX 75240
(Address of principal executive offices)
(Zip Code)
(972) 770-5600
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name, former address and former fiscal year, if changed
since last report)
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
<TABLE>
<CAPTION>
NHP RETIREMENT HOUSING PARTNERS I LIMITED PARTNERSHIP
Statements of Financial Position
March 31, 1999 December 31, 1998
-------------- -----------------
(Unaudited)
ASSETS
------
<S> <C> <C>
Cash and cash equivalents $ 5,723,863 $ 5,821,300
Other receivables 15,685 12,451
Pension notes issuance costs 327,266 357,017
Organization and offering costs - 77,615
Prepaid expenses 224,663 140,590
Rental property:
Land 2,391,705 2,391,705
Building, net of accumulated depreciation of
$5,925,894 in 1999 and $5,783,775 in 1998 16,331,567 16,457,649
Other assets 4,003 4,473
----------------- ------------------
Total assets $ 25,018,752 $ 25,262,800
================= ==================
LIABILITIES AND PARTNERS' DEFICIT
---------------------------------
Liabilities:
Accounts payable $ 272,647 $ 301,673
Interest payable 13,561,268 13,142,863
Pension notes 20,157,826 20,157,826
Other liabilities 297,712 332,144
----------------- ------------------
34,289,453 33,934,506
----------------- ------------------
Partners' deficit:
General Partner (868,926) (849,832)
Assignor Limited Partner-42,691 investment
units outstanding (8,401,775) (7,821,874)
------------------ ------------------
Total partners' deficit (9,270,701) (8,671,706)
------------------ ------------------
Total liabilities and partners' deficit $ 25,018,752 $ 25,262,800
================== ==================
</TABLE>
See notes to financial statements.
1
<PAGE>
<TABLE>
<CAPTION>
NHP RETIREMENT HOUSING PARTNERS I LIMITED PARTNERSHIP
Statement of Operations
(Unaudited)
Three months ended March 31,
1999 1998
---- ----
<S> <C> <C>
REVENUE:
Rental income $ 1,270,263 $ 4,024,049
Interest income 38,630 28,289
Other income 22,165 62,697
----------------- -----------------
1,331,058 4,115,035
----------------- -----------------
COSTS AND EXPENSES:
Salaries, related benefits and overhead reimbursements 270,703 1,007,692
Management fees, dietary fees and other services 121,373 378,688
Administrative and marketing 34,583 147,033
Utilities 82,437 255,854
Maintenance 39,353 115,573
Resident services, other than salaries 9,321 60,165
Food services, other than salaries 124,643 393,926
Depreciation 142,119 434,057
Taxes and insurance 135,717 296,424
----------------- -----------------
960,249 3,089,412
----------------- -----------------
INCOME FROM RENTAL OPERATIONS 370,809 1,025,623
----------------- -----------------
OTHER EXPENSES:
Interest expense - pension notes 774,066 1,582,983
Amortization of pension notes issuance costs 29,751 63,698
Amortization of organization and offering costs 77,615 12,444
Other 81,113 71,873
----------------- -----------------
962,545 1,730,998
----------------- -----------------
NET LOSS $ (591,736) $ (705,375)
================== ==================
NET LOSS PER ASSIGNEE INTEREST $ (14) $ (17)
================== ==================
</TABLE>
See notes to financial statements.
2
<PAGE>
<TABLE>
<CAPTION>
NHP RETIREMENT HOUSING PARTNERS I LIMITED PARTNERSHIP
Statement of Partners' Deficit
(Unaudited)
ASSIGNOR
LIMITED
GENERAL PARTNER PARTNER TOTAL
--------------- -------- -----
<S> <C> <C> <C>
Partners' deficit
at December 31, 1998 $ (849,832) $ (7,821,874) $ (8,671,706)
Distributions (7,259) - (7,259)
Net loss - Three months
ended March 31, 1999 (11,835) (579,901) (591,736)
------------------- --------------- ----------------
Partners' deficit
at March 31, 1999 $ (868,926) $ (8,401,775) $ (9,270,701)
=================== =============== ================
Percentage interest
at March 31, 1999 2% 98% 100%
== === ====
</TABLE>
See notes to financial statements.
3
<PAGE>
<TABLE>
<CAPTION>
NHP RETIREMENT HOUSING PARTNERS I LIMITED PARTNERSHIP
Statements of Cash Flows
(Unaudited)
Three months ended March 31
1999 1998
---- ----
<S> <C> <C>
Cash flows from operating activities:
Rent collections $ 1,267,029 $ 4,034,460
Interest received 38,630 28,289
Other income 22,165 62,697
Salary and related benefits (274,569) (1,013,955)
Management fees, dietary fees
and other services (122,008) (381,311)
Other operating expenses paid (649,727) (1,276,016)
Interest paid (355,661) (752,734)
----------------- ----------------
Net cash (used) provided by
operating activities (74,141) 701,430
----------------- ----------------
Cash flows from investing activities:
Capital expenditures (16,037) (144,399)
----------------- ----------------
Net cash used in investing activities (16,037) (144,399)
----------------- ----------------
Cash flows from financing activities:
Distributions (7,259) (15,362)
----------------- ----------------
Net cash used in financing activities (7,259) (15,362)
----------------- ----------------
Net (decrease) increase in cash and
cash equivalents (97,437) 541,669
Cash and cash equivalents
at beginning of period 5,821,300 4,495,733
---------------- ----------------
Cash and cash equivalents
at end of period $ 5,723,863 $ 5,037,402
================ ================
</TABLE>
See notes to financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
NHP RETIREMENT HOUSING PARTNERS I LIMITED PARTNERSHIP
Statements of Cash Flows
(Continued)
Three months Ended March 31,
1999 1998
---- ----
<S> <C> <C>
RECONCILIATION OF NET LOSS TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
Net loss $ (591,736) $ (705,375)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation 142,119 434,057
Amortization of organization
and offering costs 77,615 12,444
Amortization of pension notes
issuance costs 29,751 63,698
Changes in operating assets and liabilities:
Other assets and receivables (2,764) 10,220
Prepaid expenses (84,073) (8,684)
Accounts payable (29,026) 41,837
Interest payable 418,405 830,249
Other liabilities (34,432) 22,984
----------------- ----------------
Total adjustments 517,595 1,406,805
---------------- ----------------
Net cash (used) provided by
operating activities $ (74,141) $ 701,430
================= ================
</TABLE>
See notes to financial statements.
5
<PAGE>
NHP RETIREMENT HOUSING PARTNERS I LIMITED PARTNERSHIP
Notes to Financial Statements
March 31, 1999
(1) ACCOUNTING POLICIES
Nature of Business
NHP Retirement Housing Partners I Limited Partnership (the "Partnership")
is a limited partnership organized under the laws of the State of
Delaware on March 10, 1986. The Partnership was formed for the purpose of
raising capital by issuing both Pension Notes ("Pension Notes") to
tax-exempt investors and selling additional partnership interests in the
form of Assignee Interests ("Interests") to taxable individuals.
Interests represent assignments of the limited partnership interests of
the Partnership issued to the Assignor Limited Partner, NHP RHP-I
Assignor Corporation. The proceeds from the sale of the Pension Notes and
Interests have been invested in residential rental properties for
retirement age occupants.
Basis of Presentation
The accompanying balance sheet as of December 31, 1998, has been derived
from audited financial statements of the Partnership for the year ended
December 31, 1998, and the accompanying unaudited financial statements,
as of March 31, 1999 and 1998, have been prepared pursuant to the rules
and regulations of the Securities and Exchange Commmission. Certain
information and note disclosures normally included in the annual
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to those
rules and regulations. For further information, refer to the financial
statements and notes thereto for the year ended December 31, 1998
included in the Partnership's Annual Report on Form 10-K filed with the
Securities and Exchange Commission on March 31, 1999.
In the opinion of management, the accompanying financial statements
contain all adjustments (all of which were normal recurring accruals)
necessary to present fairly the Partnership's financial position as of
March 31, 1999 and 1998, results of operations, changes in Partner's
deficit and cash flows for three month periods ended March 31, 1999 and
1998. The results of operations for the three month period ended March
31, 1999 are not necessarily indicative of the results for the year
ending December 31, 1999.
(2) TRANSACTIONS WITH THE GENERAL PARTNER AND AFFILIATES OF THE
GENERAL PARTNER
Until January 23, 1995, the sole general partner of the Partnership was
NHP/RHGP-1 Limited Partnership (NHP/RHGP-1). Effective January 23, 1995,
Capital Realty Group Senior Housing, Inc. (CRGSH) has become the new sole
general partner of the Partnership and NHP/RHGP-I has withdrawn as
general partner.
On June 10, 1998, the sole owner of the General Partner, Capital Realty
Group Corporation, sold all of its shares of CRGSH common stock to
Retirement Associates, Inc. ("Associates") for $855,000. The source of
the funds is a Promissory Note for $855,000 with a five year term and
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bearing an interest rate of 10% per annum. The interest will accrue on the
Promissory Note and be payable at the maturity of the Promissory Note.
Associates is the maker of the Note and Capital Realty Group Corporation is
the payee. Mr. Robert Lankford is the President of Associates and has
brokered and continues to broker real estate as an independent contractor
with Capital Realty Group Corporation and its affiliates.
As discussed below, in Note 4, on September 30, 1998, the Partnership sold
its four wholly owned properties to Capital Senior Living Properties 2 -
NHPCT, Inc., a wholly owned subsidiary of Capital Senior Living Corporation
("CSLC"), for $40,650,000. An independent third party appraiser valued the
assets at $40,425,000. In connection with this sale of properties, Capital
Realty Group Brokerage, Inc., an affiliate of CSLC, and an affiliate of
CRGSH until June 30, 1998, received $1,219,500 in brokerage fees.
Personnel working at the Property sites and certain home office personnel
who perform services for the Partnership are employees of Capital Senior
Living, Inc. (CSL), an affiliate of CRGSH until June 30, 1998. The
Partnership reimburses CSL for the salaries, related benefits, and overhead
reimbursements of such personnel as reflected in the accompanying financial
statements. Salary, related benefits and overhead reimbursements reimbursed
and expensed by the Partnership to CSL for the first fiscal quarter ended
March 31, 1999 and 1998, were $286,075 and $1,007,692, respectively.
Management fees, dietary fees and other services reimbursed and expensed by
the Partnership to CSL for the first fiscal quarter ended March 31, 1999
and 1998, were 121,373 and $378,688, respectively.
Distributions of $7,259 were made to the General Partner during the three
months ended March 31, 1999.
(3) VALUATION OF RENTAL PROPERTY
Generally accepted accounting principles require that the Partnership
evaluate whether it is probable that the estimated undiscounted future cash
flows of its properties, taken individually, will be less than the
respective net book value of the properties. If such a shortfall exists and
is material, then a write-down is warranted. The Partnership performs such
evaluations on an on-going basis. During the three months ended March 31,
1999, based on the Partnership's evaluation of its property, the
Partnership did not believe that any write-down was warranted.
(4) DISPOSITION OF RENTAL PROPERTY
On September 30, 1998, the Partnership sold four properties to Capital
Senior Living Properties 2-NHPCT, Inc., a wholly owned subsidiary of CSLC,
for $40,650,000. The four properties sold were the Atrium at Carmichael,
Crosswood Oaks, The Heatherwood and the Veranda Club. After the sale, The
Amberleigh is the only remaining property in which the Partnership has any
interest. After payment of closing costs, the Partnership netted $322,652
in cash proceeds from the sale after $22,514,174 was allocated for partial
redemption of Pension Notes, $15,703,636 allocated for partial payment of
deferred interest on the redeemed Pension Notes, and $413,188 for payment
of current interest due on redeemed Pension Notes. The Partnership
recognized a $9,249,174 gain on sale of those properties at September 30,
1998.
In October, 1998, the Partnership recognized approximately $1,856,485 of
additional interest expense paid on redeemed Pension Notes resulting from
the difference between the stated interest rate of 13% on the Pension Notes
and the accrued interest rate of approximately 9% recorded by the
Partnership under the effective interest rate method. Due to the partial
7
<PAGE>
redemption of Pension Notes, the Partnership recognized $525,891 of
losses on early extinguishment of debt relating to the write off of
issuance and organization costs on Pension Notes that were redeemed.
(5) LEGAL PROCEEDINGS
On or about October 23, 1998, an Interest holder filed a putative
complaint on behalf of certain holders of Assignee Interests in NHP in
the Delaware Court of Chancery against the Partnership, CSLC, Capital
Senior Living Properties 2 - NHPCT, Inc. and CRGSH (collectively "the
Defendants"). This Interest holder purchased 90 Interests in the
Partnership in February 1993 for $180. The complaint alleges, among other
things, that the Defendants breached, or aided and abetted a breach of,
the express and implied terms of the Partnership Agreement in connection
with the sale of four properties by the Partnership to Capital Senior
Living Properties 2 - NHPCT, Inc. Capital Senior Living Properties 2 -
NHPCT, Inc. is an affiliate of Capital Senior Living, Inc., the current
manager of The Amberleigh. The complaint seeks, among other relief,
rescission of the sale of these properties and unspecified damages. The
Partnership believes the complaint is without merit and intends to
vigorously defend itself in this action.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
The following schedule summarizes the occupancy levels at The Amberleigh in
which the Partnership has a 99.9% partnership interest.
Available March 31 March 31
Units 1999 1998
----- ---- ----
The Amberleigh 271 92% 95%
At Woodstream Farms
Williamsville, New York
On November 5, 1997, the Partnership purchased approximately 3.10 acres of land
adjacent to The Amberleigh for expansion (the "Expansion") for $500,000 plus
closing costs. The General Partner is considering the Expansion as an additional
means to add to the residual value of the Partnership. There can be no assurance
however, that licensure will be granted by the regulatory authorities in New
York to allow this Expansion or that a lender will finance this development and
at favorable rates.
Rent collections for the three month period decreased to $1,267,029 in 1999 from
$4,034,460 in 1998. Salaries, management fees and other operating expenses paid
likewise decreased, from $2,671,282 in 1998 to $1,046,304 in 1999. Decreases in
both rent collections and operating expenses were due to the sale of the four
Partnership properties on September 30, 1998.
Cash generated from rental operations prior to the payment of interest expense
was insufficient to pay all of the interest on the Pension Notes currently
payable, which was $355,661 for the three month period ended March 31, 1999. Net
cash (used) provided from operations, after the payment of interest expense,
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during the three months ended March 31, 1999 and 1998 was ($74,141) and
$701,430, respectively. Interest on the Pension Notes bears stated simple
interest at 13% rate per annum, and is paid on a 7% rate per annum, however it
is accrued under the effective interest method at a rate of approximately 9% per
annum compounded quarterly, which totaled $774,066 and $1,582,983 for the three
months ended March 31, 1999 and 1998, respectively. The remaining 6% unpaid
portion is due at maturity. Total accrued and unpaid interest amounted to
$13,561,268 and $13,142,863 at March 31, 1999 and December 31, 1998,
respectively.
Capital expenditures decreased $128,362 from $144,399 in 1998 to $16,037 in 1999
due to the sale of four Partnership properties.
Cash and cash equivalents at March 31, 1999 and December 31, 1998 amounted to
$5,723,863 and $5,821,300, respectively.
Future funds may not be available to meet operating requirements, including the
ultimate payment of principal and deferred interest on the Pension Notes. This
cash need has caused the General Partner to determine that it is not financially
appropriate to make distributions to Assignee Holders.
Since 1993, cash generated from operations has been sufficient to meet the
Partnership's minimum interest payment requirements with exception of the
current quarter ending March 31, 1999. The Partnership estimates total unpaid
interest and principal will approximate $38 million at December 31, 2001, the
maturity date of the Pension Notes, which is in excess of projected cash
reserves. Accordingly, the disposition and/or refinancing value of the remaining
property will need to be sufficient to fund the amount in excess of projected
cash reserves on the Pension Notes upon their maturity. Additionally, the
General Partner is considering the Expansion as an additional means to add to
the residual value of the Partnership. There can be no assurance however, that
licensure will be granted by the regulatory authorities in New York to allow
this Expansion or that a lender will finance this development and at favorable
rates.
RESULTS OF OPERATIONS
- ---------------------
The Partnership's net loss for the three months ended March 31, 1999 includes
rental operations from the Partnership's property. The net loss also includes
depreciation, amortization of Pension Notes issuance costs, amortization of
organization and offering costs, and accrued Pension Note interest expense,
which are noncash in nature.
The Partnership net loss decreased from $705,375 to $591,736 for the three month
period ending March 31, 1998 and 1999, respectively. Net loss per assignee
interest decreased from $17 to $14 for the three month period ending March 31,
1998 and 1999, respectively. The decrease in the Partnership's net loss was
principally due to decreased interest expense resulting from the partial
redemption of pension notes in 1998. Total revenues for the three month period
decreased from $4,115,035 in 1998 to $1,331,058 in 1999. Total operating costs
and expenses likewise decreased from $3,089,412 in 1998 to $960,249 in 1999.
Decreases in both revenues and operating costs were due to the sale of the four
Partnership properties on September 30, 1998. Pension Note interest expense
decreased from $1,582,983 to $774,066 for the three month period ending March
31, 1998 and 1999, respectively, due to the partial redemption of Pension Notes
in 1998. Amortization of Pension Note issuance costs decreased from $63,698 to
$29,751 for the three month period ending March 31, 1998 and 1999, respectively,
due to the write off of certain issuance costs upon redemption of the Pension
Notes in 1998. Amortization of organization and offering costs increased from
$12,444 to $77,615 for the three month period ending March 31, 1998 and 1999,
9
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respectively, due to the write off of $68,599 in organization costs required
under the American Institute of Certified Public Accountants issued Statement of
Position 98-5, Reporting Costs of Start-up Activities. Other expenses relating
to Partnership administration increased from $71,873 to $81,113 for the three
month period ending March 31, 1998 and 1999, respectively, due to increased
professional fees.
YEAR 2000 ISSUE
- ---------------
The Year 2000 Issue is the result of computer programs being written using two
digits rather than four to define the applicable year. Any of the Partnership's
computer programs or hardware that have date-sensitive software or embedded
chips may recognize the year 2000 as a date other than the year 2000. This could
result in a system failure or miscalculations causing disruptions of operations,
including, among other things, a temporary inability to process transactions,
send invoices, or engage in similar normal business activities. Based on ongoing
assessments, the Partnership has developed a program to modify or replace
significant portions of its software and certain hardware, which are generally
PC-based systems, so that those systems will properly utilize dates beyond
December 31, 1999. The Partnership expects to substantially complete software
reprogramming and software and hardware replacement no later than December 31,
1998, with 100% completion targeted for September 30, 1999. The Partnership
presently believes that these modifications and replacements of existing
software and certain hardware will mitigate the Year 2000 Issue. However, if
such modifications and replacements are not completed timely, the Year 2000
Issue could have a material impact on the operations of the Partnership.
The Partnership has assessed its exposure to operating equipment, and such
exposure is not significant due to the nature of the Partnership's business.
The Partnership is not aware of any external agent with a Year 2000 Issue that
would materially impact the Partnership's results of operations, liquidity, or
capital resources. However, the Partnership has no means of determining whether
or ensuring that external agents will be Year 2000 ready. The inability of
external agents to complete their Year 2000 resolution process in a timely
fashion could materially impact the Partnership.
Management of the Partnership believes it has an effective program in place to
resolve the Year 2000 Issue in a timely manner. As noted above, the Partnership
has completed most but not all necessary phases of its Year 2000 program. In the
event that the Partnership does not complete the current program or any
additional phases, the Partnership could incur disruptions to its operations. In
addition, disruptions in the economy generally resulting from Year 2000 Issues
could also materially adversely affect the Partnership. The Partnership could be
subject to litigation for computer systems failure. The amount of potential
liability and lost revenue cannot be reasonably estimated at this time.
The Partnership currently has no contingency plans in place in the event it does
not complete all phases of its Year 2000 program. The Partnership plans to
evaluate the status of completion in mid 1999 and determine whether such a plan
is necessary.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
The Partnership's primary market risk exposure is from fluctuations in interest
rates and the effects of those fluctuations on the market values of its cash
equivalent short-term investments. The cash equivalent short-term investments
consist primarily of overnight investments that are not significantly exposed to
interest rate risk, except to the extent that changes in interest rates will
ultimately affect the amount of interest income earned on these investments.
PART II
ITEM 1. LEGAL PROCEEDINGS
On or about October 23, 1998, an Interest holder filed a putative complaint on
behalf of certain holders of Assignee Interests in NHP in the Delaware Court of
Chancery against the Partnership, CSLC, Capital Senior Living Properties 2 -
NHPCT, Inc. and CRGSH (collectively "the Defendants"). This Interest holder
purchased 90 Interests in the Partnership in February 1993 for $180. The
complaint alleges, among other things, that the Defendants breached, or aided
and abetted a breach of, the express and implied terms of the Partnership
Agreement in connection with the sale of four properties by the Partnership to
Capital Senior Living Properties 2 - NHPCT, Inc. Capital Senior Living
Properties 2 - NHPCT, Inc. is an affiliate of Capital Senior Living, Inc., the
current manager of The Amberleigh. The complaint seeks, among other relief,
rescission of the sale of these properties and unspecified damages. The
Partnership believes the complaint is without merit and intends to vigorously
defend itself in this action.
All other items are not applicable.
- ----------------------------------
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
(A) Exhibit:
27.1 Financial Data Schedule
(B) Reports on Form 8-K
None.
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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.
NHP Retirement Housing Partners I Limited Partnership
by: Capital Realty Group Senior Housing, Inc.
General Partner
By:
/s/ Robert Langford, President
-----------------------------------
Robert Lankford
President
Date: May 13, 1999
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Financial Data Statement for NHP Retirement Housing Partners, I, L.P.
</LEGEND>
<CIK> 0000793730
<NAME> NHP Retirement Housing Partners, I, L.P.
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<EXCHANGE-RATE> 1
<CASH> 5,723,863
<SECURITIES> 0
<RECEIVABLES> 15,685
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 24,649,166
<DEPRECIATION> (5,925,894)
<TOTAL-ASSETS> 25,018,752
<CURRENT-LIABILITIES> 0
<BONDS> 20,157,826
0
0
<COMMON> 0
<OTHER-SE> (9,270,701)
<TOTAL-LIABILITY-AND-EQUITY> 25,018,752
<SALES> 0
<TOTAL-REVENUES> 1,331,058
<CGS> 0
<TOTAL-COSTS> 960,249
<OTHER-EXPENSES> 188,479
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 774,066
<INCOME-PRETAX> (591,736)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (591,736)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
