<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
Form 10-K
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Act of 1934
For the Fiscal Year Ended Commission File Number
December 31, 1999 #33-06419-A
Condev Land Growth Fund '86, Ltd
--------------------------------
(Exact Name of Registrant as
specified in its charter)
Florida #59-2766359
------------------------------- ----------------------------
(State or other jurisdiction (IRS Employer ID #)
of incorporation or
organization)
2479 Aloma Avenue
Winter Park, Florida 32792
- -------------------------------- ---------------
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code (407) 679-1748
--------------
Securities registered pursuant to Section 12(b) of the Act:
None
----
Securities registered pursuant to Section 12(g) of the Act:
None
----
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 of 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_______
-------
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ X ]
State the aggregate market value of the voting stock held by non-affiliates of
the Registrant:
Not Applicable
--------------
<PAGE>
CONDEV LAND GROWTH FUND `86, LTD.
Table of Contents
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Part I
Item 1. Business 1
Item 2. Properties 2
Item 3. Legal Proceedings 4
Item 4. Submission of Matters to a Vote of Security Holders 4
Part II
Item 5. Market for Registrant's Common Equity and Related Security Holder Matters 5
Item 6. Selected Financial Data 5
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations 5
Item 8. Financial Statements and Supplementary Data 7
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure 25
Part III
Item 10. Directors and Executive Officers of the Registrant 25
Item 11. Executive Compensation 25
Item 12. Security Ownership of Certain Beneficial Owners and Management 26
Item 13. Certain Relationships and Related Transactions 26
Part IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K 27
Signatures 28
Annual Report to Limited Partners 29
</TABLE>
<PAGE>
PART I
Item 1.
Business:
--------
Condev Land Growth Fund '86, Ltd. (the "Partnership") is a Florida
limited partnership formed on April 17, 1986 under the Florida Uniform
Partnership Act. The Partnership was formed for the purpose of acquiring
and holding for investment pre-development land in Central Florida. The
Partnership registered with the Securities and Exchange Commission and
sold to investors a total of 7,500 units of limited partnership interest
at an initial offering price of $1,000 per unit. The partnership had
collected $7.5 million in Partnership Capital as of December 31, 1987.
As provided under the terms of the Partnership Agreement the Partnership
was to be in existence until December 31, 1993. In accordance with the
Florida Limited Partnership Law and the Partnership Agreement, after
December 31, 1993 the Partnership has been in liquidation with no change
in the status of the limited partners or General Partner.
The Partnership has purchased nine properties to be held for investment
in the Central Florida area. The Partnership purchased the last parcel
on February 6, 1989. Refer to Item 2. Properties, for full details.
Properties are sold as market conditions and demand permit. As of
December 31, 1999, the Partnership had sold all of 8 parcels and part of
another parcel. As of the same date, the Partnership had an interest in
1 remaining parcel of land.
Since the Partnership is in liquidation, the primary objective of the
Partnership is to sell properties at current market prices and
distribute the net proceeds to partners. To this end, the General
Partner is constantly monitoring area developments which are likely to
effect the salability of each property. This includes area commercial
and residential development, comparable sales transactions, road and
highway improvements, requests for zoning or comprehensive land use
changes, and changes in the availability of utilities. The General
Partner or its representatives attend county commission meetings,
planning and zoning hearings and community information meetings as part
of this endeavor. Properties are priced after consideration is given to
all of these factors.
Properties are marketed through a combination of direct advertising,
including "For Sale" signs located on each property, constant contact
with the local, national and international brokerage communities, and
direct contact with potential purchasers. Extensive marketing materials
and relevant development information is maintained and updated for use
by potential buyers.
In addition to trying to sell the portfolio properties, the Partnership
must manage the properties in the best interest of the partners. This
includes traditional property maintenance such as insuring the property
against liability, paying and appealing for adjustment, when
appropriate, real estate taxes, mowing and trash removal. It also
entails reacting promptly to area developments to insure that vested
development rights are preserved or marketability of the property is
enhanced. In some cases, it is necessary to retain consultants to assist
with this effort. In other cases, expenditure of partnership reserves is
required to keep the property properly positioned for sale.
The Partnership has no employees. Messrs. Robert N. Gardner and Joseph
J. Gardner are the general partners of Condev Associates, a Florida
general partnership, which is the General Partner of the Partnership
(the "General Partner").
1
<PAGE>
Item 2.
Properties:
----------
Since its inception, the Partnership has acquired nine properties for
investment in the Central Florida Area. Eight of these properties and a
portion of one additional property have been sold. As of December 31,
1999, the Partnership owned or had an investment in one remaining
property.
The following is a summary of all parcels acquired by the Partnership:
Parcel 1:
--------
The Partnership purchased a 1.79-acre commercial parcel of vacant land
in St. Cloud, Florida on November 30, 1987 at a price of $328,100 plus
acquisition costs of $40,741. On the same date it sold this parcel to
Barnett Bank of Central Florida, N.A. for $476,454.
Parcel 2:
--------
This 2.83-acre parcel of vacant land located at the southeast corner of
Curry Ford Road and Chickasaw Trail in southeast Orange County, Florida
was purchased in July, 1987 for $247,250. In addition to the land
purchase price, necessary sewer capacity was acquired and a sewer lift
station was built in conjunction with neighboring properties. In May,
1998 this parcel was sold to Amoco Oil Company for a gross sales price
of $475,000. After expenses, the Partnership netted $411,133 on the
transaction.
Parcel 3:
--------
This is a 12.54-acre parcel of vacant land located in St. Cloud,
Florida. The Partnership acquired this parcel in November of 1987 for
$871,900. St. Cloud is approximately 20 miles southeast of downtown
Orlando.
On August 3, 1995 the Partnership sold this property to Wal-Mart Stores.
The gross sales price was $1,480,199. After closing expenses, the
Partnership received $1,363,110. A total of $1,350,000 was distributed
to limited partners in October 1995.
Parcel 4:
--------
In February, 1988, the Partnership acquired a 6.6 acre parcel of vacant
land located at the southwest corner of State Road 50 and Woodbury Road
in East Orange County for $719,535.
On July 26, 1996, the Partnership sold approximately 1-acre of land on
the northeast corner of this parcel. The selling price for the 1-acre
site was $360,000 or $8.00 per square foot. After expenses of the sale,
the Partnership realized net cash proceeds of $284,244.
On April 30, 1998, the Partnership sold approximately 4.6 acres of this
site to Extended Stay America for $550,000. After closing costs, the net
proceeds to the Partnership were $486,830.
On August 26, 1998, the remaining one acre site within this parcel was
sold to Pebbles Restaurant Properties for $350,000. In addition, the
Partnership sold part of the sewer capacity which was reserved for
Parcel 2 for $20,000. After sales expenses, the Partnership realized
$342,970 on the sale.
In summary, the three sales relating to this parcel produced gross sales
proceeds of $1,280,000 and net proceeds of $1,114,044.
Parcel 5:
--------
In March, 1988, the Partnership acquired a 33.5-acre parcel of vacant
land located on the south side of State Road 50 in East Orange County
for $1,200,000. This site is approximately 1/4 mile east of Alafaya
Trail.
On December 2, 1993, the Partnership sold approximately 15 acres of this
parcel to Cricket Club Affordable Housing Partners, L.P. for a gross
price of $1,068,750. After costs of the sale, the Partnership received
net sales proceeds of $988,977.38.
During the first quarter of 1994, the Partnership sold the remaining
18.5-acre parcel at a price of $1,400,000. At closing the Partnership
took back a one-year mortgage for the entire purchase price. The
mortgage was subsequently reduced to $1,375,000 and the entire balance
of the note was repaid in May, 1995.
2
<PAGE>
Parcel 6:
--------
The Partnership acquired a 7-acre parcel of vacant land located
approximately 1,800 feet east of I-95/S.R. 405 interchange on the south
side of State Road 405. The property is zoned for commercial use in the
City of Titusville, Florida. The Kennedy Space Center is 4.5 miles from
the property on State Road 405. In early 1995, WalMart Stores opened a
new outlet directly across S. R. 405 from this property.
The sale of approximately one acre of this site was concluded on June
15, 1998 with Orlando Restaurants Real Estate Joint Venture. The sale
price was $310,000, and the net proceeds to the Partnership were
$272,197.
Date of Purchase: June 10, 1988
Purchase price: $ 400,000
Additional Capitalized Costs: $ 20,503
Less: One acre sale $(111,646)
Balance: $ 308,857
In October 1998 the Partnership entered into a contract for sale of this
property with a local developer of retail centers. Terms of the contract
included an inspection period of up to 180 days, and closing following
issuance of the required development permits.
In November, 1998, the general partner received notification from St.
Johns River Water Management District that this property contains some
jurisdictional wetlands, and that the area in question had been
disturbed when the property was cleared of underbrush as part of the
normal maintenance routine. The general partner engaged an environmental
consultant to assist in resolving the matter. The wetlands were flagged
and surveyed, and it was determined that approximately 1.23 acres of the
site are in fact jurisdictional wetlands. The General Partner has been
successful in reaching an agreement with the Water Management District
to mitigate the wetlands so the entire site will be useable by the
prospective buyer. The negotiated cost of fines and penalties for
disturbing the wetland was $11,694.98 and the cost of mitigation was
agreed to be $23,310, the mitigation cost to be paid upon closing of the
property sale. In the interim, the prospective purchaser has been
pursuing the necessary development permits, and the Partnership has
agreed to closing date extensions to accommodate the buyer's request.
The buyer has been paying the Partnership $5,000 per month for these
extensions. In January, 2000, the Partnership was notified by the
Florida Department of State, Division of Historical Resources, Bureau of
Historic Preservation, that "the possibility of encountering a
prehistoric archaeological site at the project location is sufficiently
high to justify a professional archaeological and historical survey
prior to any ground disturbing activities." The buyer has engaged a
state registered archaeologist to conduct the necessary study to
determine if prehistoric artifacts exist on the site, and has requested
a further extension of the contract closing date to accomplish the
study. The closing date is being extended to accommodate this request.
While it is the General Partner's opinion that no historical material of
significance will be discovered on the property, there can be no
assurance that significant artifacts will not be found.
3
<PAGE>
Parcel 7:
--------
The Partnership acquired a 59% interest in West 50 Joint Venture, which
purchased a 132.7-acre parcel located in southeast Lake County. The
property was purchased at a price of $2,518,010. The property is
approximately 1 1/2 miles west of the Florida Turnpike interchange with
State Road 50. The site has 4,700 front feet on State Road 50. The site
is currently zoned commercial (26 acres) and industrial (106.7 acres).
On December 30, 1999, West 50 Joint Venture concluded the sale of this
land to Scott Gentry, Inc. as Intermediary for Daryl M. Carter, Trustee.
The purchase price was $3,840,000. However, this amount includes a
payment by the Buyer of $340,000 to the contractor who was grading the
site for the Joint Venture, so the net selling price was $3,500,000. In
addition the Joint Venture agreed to credit the buyer with $90,000 to
compensate the buyer for additional costs associated with environmental
matters. After expenses of the sale, which included legal fees, closing
costs and a total of $300,000 in real estate commission paid to three
non-affiliated real estate brokers, the Joint Venture realized net
proceeds of $3,065,322.49. The Joint Venture used $178,913.19 of the net
proceeds to pay off the outstanding loan under the Joint Venture's line
of credit, leaving distributable proceeds of $2,866,409.30.
The Joint Venture distributed a total of $2,864,742.30 to its partners,
of which 59%, or $1,690,197.96 was distributed to Condev Land Growth
Fund `86, Ltd. The Partnership distributed a total of $1,665,000, or
$222 per unit to limited partners in January, 2000.
Parcel 8:
--------
The Partnership purchased a 1.04-acre parcel of vacant land located in
Seminole County, Florida for $300,000 in August, 1988.
During the first quarter of 1994 the Florida Department of
Transportation (FDOT) condemned and took title to this entire parcel.
The FDOT paid $455,000 for the parcel. The Partnership filed suit
against the FDOT for additional compensation for the taking of the
property and for legal fees. This suit was settled by mediation which
resulted in an additional $230,000 cash payment by FDOT to the
Partnership. Of this amount $57,500 was used to pay legal fees and
$172,500 was retained by the Partnership. Legal fees totaling $103,000
were recovered in the first quarter of 1995.
Parcel 9:
--------
On February 6, 1989, the Partnership purchased, in joint venture with an
affiliated partnership, Condev Land Fund II, Ltd., a 19+/- acre tract
located immediately north of the University of Central Florida for
$737,355.
On April 22, 1996, the joint venture sold this property to Royal
Apartments USA based in Champaign, Illinois. The purchase price for this
parcel was $1,190,000, which included $35,000 paid by the purchaser as
additional consideration to extend the closing date. After expenses of
the sale, the net proceeds realized by the Joint Venture were
$1,104,330. A total of $1,080,000 was distributed to limited partners in
May, 1993, $540,000 to limited partners of Condev Land Growth Fund `86,
Ltd., and $540,000 to limited partners of Condev Land Fund II, Ltd. The
balance was added to Partnership reserves.
Item 3.
Legal Proceedings:
-----------------
As of December 31, 1999, the Partnership is not subject to any pending
legal proceedings.
Item 4.
Submission of Matters to a Vote of Security Holders:
---------------------------------------------------
No matter was submitted to Unit Holders for a vote during the fourth
quarter of the year ended December 31, 1999.
4
<PAGE>
PART II
Item 5.
Markets for Registrant's Common Equity and Related Security Holder
------------------------------------------------------------------
Matters:
-------
(a) All Units of the Partnership have been sold; there has not been a
public secondary market and it is not anticipated that a public
secondary market for the Units will develop.
(b) As of December 31, 1999, there were approximately 619 holders of
record of the Units of the Partnership.
(c) There are no regularly scheduled distributions to limited partners.
Distributions are made subsequent to sale of Partnership properties
after provision has been made for adequate reserves to cover anticipated
future expenses of the Partnership. Unit holders received cash
distributions totaling $-0-, $1,417,500, and $-0- during the years ended
December 31, 1999, 1998, and 1997, respectively.
Item 6.
Selected Financial Data:
-----------------------
<TABLE>
<CAPTION>
Years Ending December 31,
-------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Total Revenue $ 163,902 $ 352,567 $ 4,549 $ 349,807 $1,157,261
Net Income
(Loss) 120,489 297,230 (46,136) 288,717 1,056,790
Total Assets 2,021,903 1,901,414 3,025,026 3,067,820 3,619,103
Partners'
Capital 2,021,903 1,901,414 3,021,684 3,067,820 3,619,103
</TABLE>
The above selected financial data should be read in conjunction with the
financial statements and related notes appearing elsewhere in this
annual report.
Item 7.
Management's Discussion and Analysis of Financial Condition and Results
-----------------------------------------------------------------------
of Operations:
-------------
Year 2000
---------
The Partnership is heavily dependent upon a computer system to
accurately maintain limited partner records, including name and address
information, number of units owned, distribution historical records, and
to print limited partner distribution checks. The Partnership engaged a
computer consultant to make system changes so the operation of the
Partnership was not affected by the date change at the end of 1999. The
cost of evaluating the current system and bringing it up to date to be
year 2000 compliant was less than $1,000.
January 1, 1999 through December 31, 1999
-----------------------------------------
During 1999, the General Partner focused on concluding the contract
which was in place at the end of 1998, marketing the one remaining
property, managing both properties to protect existing development
rights and obtaining permits which would allow development of the
properties. There was one sale of property during 1999. See Item 2.
-------
Properties, Parcel 7 for details. The net proceeds from this sale, after
--------------------
provision for reserves, were distributed to limited partners in January,
2000.
For the year ended December 31, 1999, total income was $163,902,
compared with $352,567 for the year ended December 31, 1998. There were
four sales of property during 1998 generating a net gain of $344,989. In
1999, there was one sale of land which resulted in a gain of $157,837.
The remaining sources of revenue remained relatively constant in both
1998 and 1999.
Expenses declined in 1999 to $43,413 compared to $55,337 in 1998. The
primary reason for the decease was a reduction in real estate taxes.
This is the expected result of a reduction in property owned by the
Partnership.
Net income for the year ended December 31, 1999 was $120,489 compared to
$297,230 in 1998.
5
<PAGE>
Total assets increased to $2,021,903 at December 31, 1999. This is
because of the sale proceeds of the property sold during December 1999.
Net proceeds of $1,665,000 were distributed to limited partners on
January 6, 2000.
Financial projections - 2000
----------------------------
For 2000, the General Partner estimates that approximately $5,000 will
be required to pay real estate taxes on the remaining property held by
the Partnership, assuming the existing contract closes by June. In
addition, the General Partner estimates that property associated holding
costs will total approximately $6,000 during 2000 and the costs of
administration, legal and accounting will require approximately $10,000.
These three categories of expense, totaling $21,000, will be paid from
Partnership reserves which were $1,704,516 at 1999 year-end. A
distribution of $1,665,000 was made to limited partners on January 6,
2000, leaving $39,516 in cash reserves available to cover expenses. At
the level of costs associated with the Partnership's business as set out
above, the Partnership has reserves at year end 1999 to fund
approximately 1 1/2 years of costs.
The General Partner estimates that the one remaining property will be
sold in 2000 resulting in cash to the Partnership in the approximate
amount of $750,000. If concluded as estimated, the sale proceeds would
result in a distribution to the limited partners in the approximate
amount of $700,000. The balance would be used to settle all final
liabilities of the Partnership. If the property does close as expected,
all liabilities of the Partnership will be paid and a final distribution
to limited partners will be made shortly thereafter. The Partnership
will then be terminated.
January 1, 1998 through December 31, 1998
-----------------------------------------
There were four sales of property during 1998. Distributions to limited
partners totaled $1,417,500 for the year.
For the year ended December 31, 1998, the Partnership reported total
revenues of $352,567, consisting of $344,989 gain on land sales and
interest income earned on short-term deposits. There were four sales of
property during 1998, generating gross sales proceeds of $1,685,000 and
net proceeds of $1,513,130. In 1997, there were no sales of property,
and total revenues were $4,549 consisting primarily of interest income
from investments.
Expenses remained relatively constant in 1997 and 1998, increasing
slightly from $50,685 in 1997 to $55,337 in 1998. The increase is
attributable to $7,355 in amortization charges taken in 1998 compared
with $-0- in 1997. Amortization of organization costs is recognized only
when properties are sold, and there were no sales of property during
1997. Other expense categories remained relatively unchanged.
Net income for 1998 was $297,230 compared to a net loss of $46,136 for
1997. Future profitability will depend on the Partnership's ability to
sell portfolio properties at or near current market prices.
Total assets decreased from $3,025,026 at December 31, 1997 to
$1,901,414 at December 31, 1998. This is the anticipated result of the
four property sales during 1998 and subsequent distribution of net
proceeds to limited partners. The Partnership's liquidity was enhanced
by withholding reserves for future anticipated costs from net sales
proceeds. At year-end 1998, the Partnership held $39,457 in cash and
cash equivalents, compared to $19,062 at year-end 1997.
January 1, 1997 through December 31, 1997
-----------------------------------------
While no sales of land were concluded during 1997, at year-end the
Partnership held four contracts which ultimately closed during 1998.
For the year ended December 31, 1997, the Partnership reported total
revenues of $4,549, consisting primarily of interest income earned on
short-term deposits. There were no sales of property during 1997. In
1996, there were two sales of property producing $193,002 in land sale
gains and $127,712 in profits in the Partnership's joint venture. In
addition, the Partnership had $20,000 in income from a forfeited deposit
on land during 1996. The combined result was a drop in total revenues
from $349,807 in 1996 to only $4,549 in 1997.
Expenses declined from $61,090 for the year ended December 31, 1996 to
$50,685 for the year ended December 31, 1997. This was almost entirely
due to a reduction in taxes and permits, which fell from $32,399 in 1996
to $22,775 in 1997. Taxes can be expected to decline as properties are
sold. Other expense categories remained relatively unchanged.
The net loss for 1997 was $46,136 compared to a profit of $288,717 for
1996. Future profitability will depend on the Partnership's ability to
sell portfolio properties at or near current market prices.
6
<PAGE>
Item 8.
<TABLE>
<CAPTION>
Financial Statements and Supplementary Data:
-------------------------------------------
I. Condev Land Growth Fund `86, Ltd.
-----------------------------------
Page
<S> <C>
INDEPENDENT AUDITORS' REPORT 8
FINANCIAL STATEMENTS
Balance sheets 9
Statements of operations 10
Statements of partners' capital 11
Statements of cash flows 12
Notes to financial statements 13-17
II. West 50 Joint Venture
-------------------------
INDEPENDENT AUDITORS' REPORT 18
FINANCIAL STATEMENTS
Balance sheets 19
Statements of operations 20
Statements of venturers' capital 21
Statements of cash flows 22
Notes to financial statements 23-24
</TABLE>
7
<PAGE>
INDEPENDENT AUDITORS' REPORT
----------------------------
The Partners
Condev Land Growth Fund '86, Ltd.
Winter Park, Florida
We have audited the accompanying balance sheets of Condev Land Growth Fund
'86, Ltd. (a Florida Limited Partnership) as of December 31, 1999 and 1998, and
the related statements of operations, partners' capital, and cash flows for each
of the three years in the period ended December 31, 1999. These financial
statements are the responsibility of the General Partner. Our responsibility is
to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Condev Land Growth Fund '86,
Ltd. as of December 31, 1999 and 1998, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 1999, in
conformity with generally accepted accounting principles.
OSBURN, HENNING AND COMPANY
Orlando, Florida
January 13, 2000
8
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
BALANCE SHEETS
December 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
---------- ----------
<S> <C> <C>
ASSETS
Cash and cash equivalents $1,704,516 $ 39,457
Accounts receivable - 6,078
Due from related entity 1,222 1,222
Land, at cost (Note 2) 313,880 308,857
Investment in joint venture (Note 3) - 1,532,361
Organization costs, less accumulated
amortization of $40,463 in 1999 and
$29,309 in 1998 2,285 13,439
---------- ----------
$2,021,903 $1,901,414
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities $ - $ -
---------- ----------
Partners' capital
General partner 2,595 3,027
Limited partners 2,019,308 1,898,387
---------- ----------
Total partners' capital 2,021,903 1,901,414
---------- ----------
$2,021,903 $1,901,414
========== ==========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
9
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
STATEMENTS OF OPERATIONS
Years Ended December 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
1999 1998 1997
-------- --------- -------
<S> <C> <C> <C>
Revenue:
Gain on land sale $ - $ 344,989 $ -
Equity in income of joint
ventures 157,837 1,685 904
Interest income 1,065 5,818 3,645
Other income 5,000 75 -
--------- --------- -------
163,902 352,567 4,549
--------- --------- -------
Expenses:
Taxes and permits 10,353 21,106 22,775
Office expenses 12,534 14,408 14,420
Professional fees 9,000 10,175 11,758
Amortization 11,154 7,355 -
Other expenses 372 2,293 1,732
--------- --------- -------
43,413 55,337 50,685
--------- --------- -------
Net income (loss): $ 120,489 $ 297,230 $(46,136)
========= ========= ========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
10
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
Years Ended December 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
------- ------------ ------------
<S> <C> <C> <C>
Balances, December 31, 1996 $3,966 $ 3,063,854 $ 3,067,820
Net income (loss) (461) (45,675) (46,136)
------ ----------- -----------
Balances, December 31, 1997 3,505 3,018,179 3,021,684
Net income (loss) (478) 297,708 297,230
Distributions - (1,417,500) (1,417,500)
------ ----------- -----------
Balances, December 31, 1998 3,027 1,898,387 1,901,414
Net income (loss) (432) 120,921 120,489
------ ----------- -----------
Balances, December 31, 1999 $2,595 $ 2,019,308 $ 2,021,903
====== =========== ===========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
11
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
1999 1998 1997
---------- ----------- ---------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 120,489 $ 297,230 $ (46,136)
Adjustments to reconcile net income
(loss) to net cash (used in)
operating activities:
Gain on land sale - (344,989) -
Equity in (income) of joint
venture (157,837) (1,685) (904)
Amortization 11,154 7,355 -
(Increase) decrease in:
Accounts receivable 6,078 (6,078) -
Due from related entity - 460 (1,682)
Increase (decrease) in:
Accounts payable - (1,242) 1,242
Deposits on land - (2,100) 2,100
---------- ----------- ---------
Net cash (used in)
operating activities (20,116) (51,049) (45,380)
---------- ----------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from land sales, net of
closing costs - 1,487,437 -
Capitalized land related costs (5,023) (853) (49,217)
Investment in joint venture - - (31,212)
Distributions from joint venture 1,690,198 2,360 -
---------- ----------- ---------
Net cash provided by
(used in) investing
activities 1,685,175 1,488,944 (80,429)
---------- ----------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners - (1,417,500) -
---------- ----------- ---------
Net increase (decrease) in
cash and cash equivalents 1,665,059 20,395 (125,809)
CASH AND CASH EQUIVALENTS, BEGINNING 39,457 19,062 144,871
---------- ----------- ---------
CASH AND CASH EQUIVALENTS, ENDING $1,704,516 $ 39,457 $ 19,062
========== =========== =========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
12
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Organization
------------
Condev Land Growth Fund '86, Ltd. (the Partnership) is a Florida
Limited Partnership formed on April 17, 1986 under the Florida
Uniform Partnership Act. The Partnership was formed for the
purpose of acquiring and holding predevelopment land in Central
Florida for investment. The Partnership was formed with an
initial capital contribution of $1,000 from the general partner,
Condev Associates, and the issuance of 7,500 units of limited
partnership interest at $1,000 per unit.
The terms of the partnership agreement provided that the
Partnership would continue in existence until December 31, 1993.
However, the Partnership's operation will continue until all
investments of the Partnership are sold and proceeds distributed
to the partners.
Use of Estimates
----------------
In preparing the financial statements, management is required to
make estimates and assumptions that affect the reported amounts
of assets and liabilities as of the date of the financial
statements and revenues and expenses for the period. Actual
results may differ significantly from those estimates.
Cash and Cash Equivalents
-------------------------
The Partnership considers all highly liquid debt instruments
purchased with a maturity of three months or less to be cash
equivalents. At December 31, 1999, cash and cash equivalents
include $12,076 invested in a money market account (Nations Prime
Inv Daily Shares).
Organization Costs
------------------
The Partnership has capitalized all organization costs. Upon sale
of land, each parcel is allocated a portion of these costs based
on the ratio of total acquisition cost to the net proceeds of the
offering available to purchase properties for investment. The
accompanying statements of operations include $11,154, $7,355 and
$-0- of amortization of organization costs resulting from the
sales of land within the joint venture and the Partnership during
the years ended December 31, 1999, 1998 and 1997, respectively.
For tax purposes, the Partnership amortized organization costs
over five years.
CONTINUED ON NEXT PAGE
13
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies - (Continued)
Land
----
Land, held for investment, is stated at the lower of cost or fair
value. Land is assessed for impairment when the Partnership
believes events or changes in circumstances indicate that its
carrying amount may not be recoverable. Costs that clearly relate
to land development projects are capitalized. Interest costs,
real estate taxes and insurance are capitalized while development
is in progress. When development is complete, these costs are
expensed.
Investment in Joint Venture
---------------------------
Investment in joint venture is accounted for using the equity
method.
Income Taxes
------------
Rather than being a taxable entity, the Partnership functions as
a conduit for income tax purposes. As such, the Partnership files
an information tax return on which it allocates its revenue and
expenses among the partners as required by the partnership
agreement. The partners are required to report such items on
their individual income tax returns.
Note 2. Land
At December 31, 1999 and 1998, land consisted of a 6 acre parcel
(zoned commercial) in Brevard County, Florida.
The Partnership has a contract to sell the remaining parcel of
land for $850,000. The contract is scheduled to close in the
first quarter of 2000.
Note 3. Investment in Joint Venture
The Partnership owned a 59% interest in West 50 Joint Venture (a
Florida Joint Venture) (the Joint Venture) whose purpose was to
acquire and hold a 133 acre parcel of land in Lake County, Florida for
investment purposes. The remaining 41% interest was owned by Condev
West 50, Ltd., an affiliate of the Partnership's general partner. The
Partnership's investment was carried at its equity in the net
underlying assets. The Partnership's investment in the joint venture
as of December 31, and its equity in income of the joint venture for
the years then ended are as follows:
CONTINUED ON NEXT PAGE
14
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 3. Investment in Joint Venture - (Continued)
<TABLE>
<S> <C>
Investment:
1999 $ -
1998 1,532,361
1997 1,533,035
Equity in income:
1999 $ 157,837
1998 1,685
1997 904
</TABLE>
A summary of the assets, liabilities, and venturers' capital of the
Joint Venture at December 31, 1999 and 1998 is as follows:
<TABLE>
<CAPTION>
1999 1998
--------- ----------
<S> <C> <C>
Assets
------
Cash $ - $ 21,568
Investment in land - 2,711,839
--------- ----------
$ - $2,733,407
========= ==========
Liabilities and Venturers' Capital
----------------------------------
Liabilities $ - $ 136,185
Venturers' capital - 2,597,222
--------- ----------
$ - $2,733,407
========= ==========
</TABLE>
The Joint Venture had revenue of $277,394, $8,250 and $6,000 during the
years ended December 31, 1999, 1998 and 1997, respectively, and net income of
$267,520, $2,857 and $1,532, respectively.
Pursuant to the joint venture agreement, the Partnership was required
to contribute funds as needed from time to time to pay operating
expenses incurred by the Joint Venture. During 1999, 1998 and 1997,
the Partnership was asked to contribute $-0-, $-0- and $31,213,
respectively, to pay real estate taxes and operating expenses incurred
by the Joint Venture.
During the year ended December 31, 1999, the Joint Venture sold its
parcel of land and recognized a gain of $277,394. The Joint Venture
made a complete distribution to its venturers of $2,864,742, of which
the Partnership received $1,690,198, thereby terminating the Joint
Venture.
Accordingly, the Joint Venture had no assets, liabilities and
venturers' capital at December 31, 1999.
15
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 4. Allocations and Distributions to Partners
Operations (excluding land sales)
---------------------------------
Pursuant to the partnership agreement, cash flow and profits and
losses from operations are allocated and distributed 99% to the
limited partners and 1% to the general partner. No distributions
attributable to cash flow were made during the years ended
December 31, 1999, 1998 or 1997.
Land sales
----------
With respect to disposition of parcels of land, the allocations
and distributions shall be made as follows:
1. To the limited partners, an amount equal to the
Partnership's cost of the parcel disposed of;
2. To the limited partners, an amount equal to real estate
taxes, and organization and syndication expenses allocable
to the parcel disposed of;
3. To the limited partners, an amount equal to 10% per year
non-compounded return on such distributions minus previous
distributions of cash flows;
4. To the general partner and limited partners, 20% and 80%,
respectively, of the net cash proceeds after the above
distributions.
For the purposes of making the above described computations, the
Partnership books will be deemed to close as of the month-end
closest to the date of sale.
The limited partners received distributions of $-0-, $1,417,500
and $-0- attributable to net cash proceeds from the sales of land
during the years ended December 31, 1999, 1998 and 1997,
respectively. A distribution of $1,665,000 was made on January 6,
2000.
16
<PAGE>
CONDEV LAND GROWTH FUND '86, LTD.
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note 5. Related Party Transactions
The partnership agreement permits the general partner or its
affiliates to receive an acquisition fee or a real estate commission
from sellers in an amount not to exceed 5% of the gross purchase price
of land purchased by the Partnership, so long as the total acquisition
fee, including that paid to unaffiliated parties, does not exceed 10%
of the gross purchase price. No acquisition fees were paid in 1999,
1998 or 1997, as no properties were purchased.
When properties are sold, an affiliate of the general partner may be
paid real estate commissions in amounts customarily charged by others
rendering similar services, with such commissions, plus commissions
paid to nonaffiliates, not to exceed 10% of the gross sales price. In
connection with the four land sales during 1998, real estate
commissions of 10% for each sale were paid to nonaffiliates. No real
estate commissions were paid in 1999 and 1997, as no sales occurred.
The general partner earned certain fees for administration and
management services provided, pursuant to the Partnership agreement.
Such fees amounted to $8,496, $8,496 and $9,096 for each of the years
ended December 31, 1999, 1998 and 1997.
Note 6. Concentration of Credit Risk
The Partnership has all its cash and cash equivalents in accounts with
one bank and one investment company. Accounts in the bank are
federally insured up to $100,000 per customer.
17
<PAGE>
INDEPENDENT AUDITORS' REPORT
----------------------------
The Venturers
West 50 Joint Venture
Winter Park, Florida
We have audited the accompanying balance sheets of West 50 Joint Venture (a
Florida Joint Venture) as of December 31, 1999 and 1998, and the related
statements of operations, venturers' capital and cash flows for each of the
three years in the period ended December 31, 1999. These financial statements
are the responsibility of the Joint Venture's management. Our responsibility is
to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
As described in Note 1 to the financial statements, the Joint Venture was
dissolved on December 31, 1999.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of West 50 Joint Venture as of
December 31, 1999 and 1998, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 1999, in conformity
with generally accepted accounting principles.
OSBURN, HENNING AND COMPANY
Orlando, Florida
January 14, 2000
18
<PAGE>
WEST 50 JOINT VENTURE
(A Florida Joint Venture)
BALANCE SHEETS
December 31, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
--------- ----------
<S> <C> <C>
ASSETS
Cash $ - $ 21,568
Land, at cost - 2,711,839
--------- ----------
$ - $2,733,407
========= ==========
LIABILITIES AND VENTURERS' CAPITAL
Liabilities
Accounts payable $ - $ 320
Note payable - 135,865
--------- ----------
- 136,185
Venturers' capital - 2,597,222
--------- ----------
$ - $2,733,407
========= ==========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
19
<PAGE>
WEST 50 JOINT VENTURE
(A Florida Joint Venture)
STATEMENTS OF OPERATIONS
Years Ended December 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
<S> <C> <C> <C>
Revenue
Gain on sale of land $277,394 $ - $ -
Other income - 8,250 6,000
-------- -------- --------
277,394 8,250 6,000
-------- -------- --------
Expenses:
Real estate taxes - - 764
Professional fees 8,350 4,450 3,000
Insurance 1,011 509 704
Office expense 513 434 -
-------- -------- --------
9,874 5,393 4,468
-------- -------- --------
Net income $267,520 $ 2,857 $ 1,532
======== ======== ========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
20
<PAGE>
WEST 50 JOINT VENTURE
(A Florida Joint Venture)
STATEMENTS OF VENTURERS' CAPITAL
Years Ended December 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
Condev Land
Growth Fund Condev
`86, Ltd. West 50, Ltd. Total
------------ -------------- ------------
<S> <C> <C> <C>
Balances at December 31, 1996 $ 1,500,919 $ 1,043,012 $ 2,543,931
Contributions 31,212 21,690 52,902
Net income 904 628 1,532
----------- ----------- -----------
Balances at December 31, 1997 1,533,035 1,065,330 2,598,365
Distributions (2,360) (1,640) (4,000)
Net income 1,686 1,171 2,857
----------- ----------- -----------
Balances at December 31, 1998 1,532,361 1,064,861 2,597,222
Distributions (1,690,198) (1,174,544) (2,864,742)
Net income 157,837 109,683 267,520
----------- ----------- -----------
Balances at December 31, 1999 $ - $ - $ -
=========== =========== ===========
</TABLE>
The Notes to Financial Statements are an integral part of these statements.
21
<PAGE>
WEST 50 JOINT VENTURE
(A Florida Joint Venture)
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
1999 1998 1997
------------ ---------- ---------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 267,520 $ 2,857 $ 1,532
Adjustments to reconcile net income
to net cash used in operating
activities:
Gain on land sale (277,394) - -
Increase (decrease) in:
Accounts payable (320) (17,383) (19,710)
Deposit on land - (1,000) 1,000
----------- --------- --------
Net cash used in
operating activities (10,194) (15,526) (17,178)
----------- --------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Capitalized land related costs (77,085) (101,464) (36,367)
Proceeds from land sale, net
of closing costs 2,887,453 - -
----------- --------- --------
2,810,368 (101,464) (36,367)
----------- --------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from line of credit 43,000 135,865 -
Capital contributions - - 52,902
Capital distributions (2,864,742) (4,000) -
----------- --------- --------
Net cash provided by
financing activities 2,821,742 131,865 52,902
----------- --------- --------
Net increase (decrease)
in cash (21,568) 14,875 643
CASH, BEGINNING 21,568 6,693 6,050
----------- --------- --------
CASH, ENDING $ - $ 21,568 $ 6,693
=========== ========= ========
</TABLE>
Supplemental information:
In connection with the 1999 land sale, the sale proceeds were reduced by the
note payable balance of $178,865.
The Notes to Financial Statements are an integral part of these statements.
22
<PAGE>
WEST 50 JOINT VENTURE
(A Florida Joint Venture)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
Organization/Business Interest
------------------------------
On May 31, 1988, Condev Land Growth Fund '86 (the Fund) and Condev
West 50, Ltd. (West 50, Ltd.) (collectively, the Venturers), both of
which are Florida Limited Partnerships in which Condev Associates is
the general partner, entered into an agreement to form West 50 Joint
Venture (the Joint Venture). The Joint Venture has acquired a 133 acre
parcel of land in Lake County, Florida that will be held for
investment purposes. The Venture may incur limited development costs
to prepare land for sale.
The Joint Venture's assets were liquidated during the year ended
December 31, 1999, and the Joint Venture was dissolved.
Use of Estimates
----------------
In preparing the financial statements, management is required to make
estimates and assumptions that affect the reported amounts of assets
and liabilities as of the date of the financial statements and
revenues and expenses for the period. Actual results could differ
significantly from those estimates.
Funding
-------
The Fund and West 50, Ltd. are required to contribute 59% and 41%,
respectively, to the capital of the Joint Venture from time to time as
required for the Joint Venture's operations. It is the intent of the
Venturers that all cash requirements of the Joint Venture shall come
from the Venturers, however certain limited development resulted in
the Venture obtaining a line of credit (See Note 3).
Land
----
Land held for investment, is stated at the lower of cost or fair
value. Land is assessed for impairment when the Joint Venture believes
that events or changes in circumstances indicate that its carrying
amount may not be recoverable. Costs that clearly relate to land
development projects are capitalized. Interest costs, real estate
taxes and insurance are capitalized while development is in progress.
When development is complete, these costs are expensed.
CONTINUED ON NEXT PAGE
23
<PAGE>
WEST 50 JOINT VENTURE
(A Florida Joint Venture)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies - (Continued)
Allocations
-----------
Profits shall be allocated 59% to the Fund and 41% to West 50, Ltd.
after certain allocations to reduce any negative capital balance and
to distribute any net cash flow generated from the Joint Venture.
Losses are allocated 59% to the Fund and 41% to West 50, Ltd. after a
proportionate allocation to the Venturers with positive capital
balances.
Distributions
-------------
Cash flow generated from the Joint Venture shall be distributed 59% to
the Fund and 41% to West 50, Ltd.
Income Taxes
------------
Rather than being a taxable entity, the Joint Venture functions as a
conduit for income tax purposes. As such, the Joint Venture files an
information tax return on which it allocates its revenue and expenses
among the Venturers as required by the joint venture agreement. The
Venturers are required to report such items on their respective income
tax returns.
Note 2. Sale of Land
During the year ended December 31, 1999, the Joint Venture sold its
entire investment in land. The total selling price was $3,410,000.
Note 3. Note Payable
During the year ended December 31, 1999, the Venture was obligated to
Citrus Bank on a $500,000 line of credit. Interest payments were due
monthly at prime plus .5% (8.5% at December 31, 1999). Principal and
interest were due on demand. During the years ended December 31, 1999
and 1998, the Venture incurred and capitalized interest of $13,428 and
$6,396, respectively. The line of credit was paid in full at December
31, 1999.
Note 4. Related Party Transactions
The joint venture agreement permits the general partner of the
Venturers or an affiliate to receive an acquisition fee or a real
estate commission from sellers in an amount not to exceed 5% of the
gross purchase price of land purchased by the Joint Venture, so long
as the total acquisition fee, including that paid to unaffiliated
parties, does not exceed 10% of the gross purchase price. No
acquisition fees were paid in 1999, 1998 or 1997, as no properties
were purchased.
When properties are sold, an affiliate of the general partner of the
Venturers may be paid real estate commissions in the amounts
customarily charged by others rendering similar services. Such
commissions plus commissions paid to nonaffiliates are not to exceed
10% of the gross sales price. In connection with the land sale in
1999, real estate commissions totaling 8.8% were paid, all to
nonaffiliates. No real estate commissions were paid in 1998 or 1997,
as no sales occurred.
24
<PAGE>
Item 9.
Changes in and Disagreements with Accountants on Accounting and
---------------------------------------------------------------
Financial Disclosure:
--------------------
There were no disagreements on accounting and financial disclosures
required to be disclosed by Item 304 of Regulation S-K.
PART III
Item 10.
Directors and Executive Officers of the Registrant
--------------------------------------------------
(a) The Registrant does not have a Board of Directors. Condev
Associates, A Florida general partnership consisting of Messrs. Robert
N. Gardner and Joseph J. Gardner, is the General Partner of the
Partnership.
(b), (c), (d) and (e)
Robert N. Gardner and Joseph J. Gardners are brothers. The background
and experience of the partners of the General Partner are as follows:
Robert N. Gardner, age 65 has been president, a director and
-----------------
shareholder of Condev Corporation and it's predecessors since 1961. A
Florida licensed real estate broker and Class A Contractor, he serves
on the boards of directors of NationsBank of Central Florida, N.A.,
and Schroeder-Manatee, Inc.
Joseph J. Gardner, age 62 has been an officer, a director and
-----------------
shareholder of Condev Corporation and its predecessors since 1961.
Prior to joining Condev Corporation, he was employed in the land
department of Continental Oil Company. Mr. Gardner is Director of
Protection One, Inc.. He is a licensed real estate broker.
Condev Corporation, which has its offices located at the same address
of the General Partner and Partnership, has been operating in the
Florida real estate market since 1961. It has two active affiliates.
PCD, Inc. is a development company specializing in horizontal land
development. Condev Realty, Inc. is a Florida licensed real estate
broker which concentrates on site acquisition, land assemblage and
land investment.
Item 11.
Executive Compensation
----------------------
(a), (b), (c) and (d)
The Registrant has not paid and does not plan to pay any executive
compensation to the General Partners or their affiliates.
25
<PAGE>
Item 12.
Security Ownership of Certain Beneficial Owners and Management:
--------------------------------------------------------------
(a) The following is a list of persons who are known to the
Registrant to be the beneficial owners of more than 5% of the total
units outstanding as of December 31, 1999:
<TABLE>
<CAPTION>
Name and Address of Amount & Nature Percent of
Title of Class Beneficial Owner of Beneficial Owner Class
------------------ ------------------------ ------------------- ----------
<S> <C> <C> <C>
Unit Holder Jody B. Burgoon Trust 25 units
Richard A. Burgoon, TTEE
Susan A. Burgoon Trust 60 units
Richard A. Burgoon, TTEE
Richard A. Burgoon 60 units
Richard A. Burgoon CUST FBO 70 units
Richard Burgoon, FL UGMA
Richard R. Burgoon and 440 units
Patricia B. Burgoon, JTWRS
393 Whooping Loop #1403
Altamonte Springs, FL 32701
---------
655 units 8.73%
Unit Holder Bishop Norbert M. Dorsey 500 units 6.67%
TTEE, FBO Diocese of Orlando
Pension Plan #02132-66-0
Post Office Box 1800
Orlando, FL 32802
</TABLE>
(b) The following is a list of units beneficially owned by all
partners of the General Partner as of December 31, 1998:
<TABLE>
<S> <C> <C> <C>
Unit Holder Robert N. and Patricia 30 units 0.4%
Gardner
1014 Temple Grove
Winter Park, FL 32789
</TABLE>
(c) There are no arrangements known to the registrant, including any
pledge by any person of securities of the registrant or any of its
parents or affiliates, the operation of which may at a subsequent date
result in a change in control of the registrant.
Item 13.
Certain Relationships and Related Transactions
----------------------------------------------
(a), and (b)
The partnership agreement permits the General Partner or affiliate to
receive an acquisition fee or a real estate commission from sellers in
an amount not to exceed 5% of the gross purchase price of land
purchased by the partnership, so long as the total acquisition fee,
including that paid to unaffiliated parties, does not exceed 10% of
the gross purchase price. No acquisition fees were paid during the
years ended December 31, 1998, 1997 or 1996 as no properties were
purchased.
When properties are sold, an affiliate of the General Partner may be
paid real estate commissions in amounts customarily charged by others
rendering similar services, with such commissions, plus commissions
paid to non-affiliates, not to exceed 10% of the gross sales price. No
real estate commissions were paid to a General Partner affiliate
during the years ended December 31, 1998, 1997, or 1996.
26
<PAGE>
Pursuant to the Partnership agreement, the General Partner earned
certain fees for administration and management services provided. Such
fees amounted to $8,496, $8,496, and $9,096, for each of the years
ended December 31, 1998, 1997 and 1996.
(c) No management person in indebted to the Registrant.
(d) Not applicable.
PART IV
Item 14.
Exhibits, Financial Statement, Schedules, and Reports on Form 8-K:
-----------------------------------------------------------------
(a) The following financial statements and supplementary data are
included in Part II Item 8:
Page
(1) Condev Land Growth Fund `86, Ltd.
--------------------------------
Independent Auditor's Report 9
Financial Statements
Balance Sheets - December 31, 1998 and 1997 10
Statements of Operations - Years ended
December 31, 1998, 1997 and 1996 11
Statements of Partners' Capital -
Years ended December 31, 1998, 1997 and 1996 12
Statements of Cash Flows -
Years ended December 31, 1999, 1998 and 1997 13
Notes to Financial Statements 14-19
(2) West 50 Joint Venture
---------------------
Independent Auditor's Report 20
Financial Statements
Balance Sheets - December 31, 1998 and 1997 21
Statements of Operations - Years ended
December 31, 1998, 1997 and 1996 22
Statements of Partners' Capital -
Years ended December 31, 1998, 1997 and 1996 23
Statements of Cash Flows -
Years ended December 31, 1998, 1997 and 1996 24
Notes to Financial Statements 25-26
(3) Exhibits included herein:
13 - Annual Report to Unit Holders 32
(b) Reports on Form 8-K
No reports on Form 8-K have been filed by the Registrant
during the last quarter of the period covered by this
report.
27
<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.
CONDEV ASSOCIATES, General Partner
Date: February 24, 2000 By: /s/ Robert N. Gardner
-------------------- ----------------------------
Robert N. Gardner, Partner
Date: February 24, 2000 By: /s/ Joseph J. Gardner
-------------------- ---------------------------
Joseph J. Gardner, Partner
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the date indicated.
CONDEV ASSOCIATES, General Partner
/s/ Robert N. Gardner February 24, 2000
- --------------------------------- ---------------------------
Robert N. Gardner, Partner Date
/s/ Joseph J. Gardner February 24, 2000
- --------------------------------- ---------------------------
Joseph J. Gardner, Partner Date
28
<PAGE>
February 7, 2000
Condev Land Growth Fund '86, Ltd.
1999 Annual Report
Dear Limited Partner:
Enclosed is your Schedule K-1 (Form 1065) relating to the Partnership's
operations for the year ended December 31, 1999. If your investment is held by a
custodian, the K-1 is for information purposes only. A copy of this form has
been sent to your custodian.
The financial statements of the Partnership for the year ending December 31,
1999 are on the reverse side hereof. There was one property sale during the
year. On December 29, 1999, West 50 Joint Venture, in which the Partnership
holds a 59% interest, sold its property on West SR 50 in Lake County. On January
6, 2000 a total of $1,665,000, or $222 per unit, was distributed to limited
partners. Details of the sale were included in the January 6 Distribution
Report. As of December 31, 1999, the net asset value (book value) per unit of
limited partner interest was $269.24, which included the $222 per unit
distributed on January 6, 2000. As of that date, the Partnership owned one
remaining property:
NASA Causeway, Titusville. This property continues to be under contract with an
- -------------------------
investor who is developing the site for retail users. The buyer has made a
$30,000 non-refundable deposit on the contract, and is paying the Partnership a
non-refundable monthly extension fee. The buyer has obtained most of the permits
required to develop the property, and we anticipate closing on this property
near the end of February, 2000.
If the property does close as expected, all liabilities of the Partnership will
be paid and a final distribution to limited partners will be made shortly
thereafter. The Partnership will then be terminated.
Please feel free to contact the Investor Relations office if you have any
questions or would like additional information concerning your investment.
Sincerely yours,
CONDEV ASSOCIATES
29
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 12-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1998
<PERIOD-START> JAN-01-1999 JAN-01-1998
<PERIOD-END> DEC-31-1999 DEC-31-1998
<CASH> 1,704,516 39,457
<SECURITIES> 0 0
<RECEIVABLES> 1,222 7,300
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 313,880 308,857
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 2,021,903 1,901,414
<CURRENT-LIABILITIES> 0 0
<BONDS> 0 0
0 0
0 0
<COMMON> 0 0
<OTHER-SE> 2,021,903 1,901,414
<TOTAL-LIABILITY-AND-EQUITY> 2,021,903 1,901,414
<SALES> 0 0
<TOTAL-REVENUES> 163,902 352,567
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 43,414 55,337
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 120,489 297,230
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 120,489 297,230
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 120,489 297,230
<EPS-BASIC> 0 0
<EPS-DILUTED> 0 0
</TABLE>
