FORM 10-QSB.--QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
(As last amended by 34-32231, eff. 6/3/93.)
U.S. 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 June 30, 1995
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT
For the transition period.........to.........
Commission file number 0-15675
DAVIDSON GROWTH PLUS, L.P.
(Exact name of small business issuer as specified in its charter)
Delaware 52-1462866
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
One Insignia Financial Plaza, P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (803) 239-1000
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the 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>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) DAVIDSON GROWTH PLUS, L.P.
CONSOLIDATED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
June 30, 1995
<S> <C> <C>
Assets
Cash:
Unrestricted $1,129,867
Restricted-tenant security deposits 108,589
Accounts receivable 6,817
Escrows for taxes and insurance 303,615
Restricted escrows 537,548
Other assets 455,964
Investment properties:
Land $ 4,649,770
Buildings and related personal
property 18,571,230
23,221,000
Less accumulated depreciation (7,267,999) 15,953,001
$18,495,401
Liabilities and Partners' Capital (Deficit)
Liabilities
Accounts payable $ 42,437
Tenant security deposits 108,819
Accrued taxes 207,003
Other liabilities 193,349
Subordinated management fee 156,777
Mortgage notes payable 12,397,005
Minority Interest 324,996
Partners' Capital (Deficit)
General partner $ (666,401)
Limited partners (28,371.75 units
issued and outstanding) 5,731,416 5,065,015
$18,495,401
</TABLE>
1
<PAGE>
See Accompanying Notes to Consolidated Financial Statements
b) DAVIDSON GROWTH PLUS, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
<S> <C> <C> <C> <C>
1995 1994 1995 1994
Revenues:
Rental income $1,162,791 $1,094,499 $2,327,885 $2,202,441
Other income 44,323 52,712 125,565 99,842
Total revenues 1,207,114 1,147,211 2,453,450 2,302,283
Expenses:
Operating 324,848 335,219 609,697 641,841
General and administrative 50,588 47,563 93,616 90,077
Property management fees 60,140 57,508 120,489 114,218
Maintenance 155,483 102,790 273,874 214,855
Depreciation 176,616 167,854 350,924 332,441
Interest 272,834 274,247 546,414 549,399
Property taxes 109,469 106,324 214,178 208,451
Subordinated partnership
management fee 2,788 -- 9,140 2,225
Total expenses 1,152,766 1,091,505 2,218,332 2,153,507
Minority interest in net
income of joint venture (14,005) (14,381) (31,752) (25,651)
Loss on disposal of
property -- -- (3,099) --
Net income $ 40,343 $ 41,325 $ 200,267 $ 123,125
Net income allocated to
general partners (3%) $ 1,210 $ 1,240 $ 6,008 $ 3,694
Net income allocated to
limited partners (97%) 39,133 40,085 194,259 119,431
$ 40,343 $ 41,325 $ 200,267 $ 123,125
Net income per limited
partnership unit $ 1.38 $ 1.41 $ 6.85 $ 4.21
</TABLE>
2
<PAGE>
See Accompanying Notes to Consolidated Financial Statements
3
<PAGE>
c) DAVIDSON GROWTH PLUS, L.P.
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(Unaudited)
<TABLE>
<CAPTION>
Limited
Partnership General Limited
Units Partners Partners Total
<S> <C> <C> <C> <C>
Original capital
contributions 28,371.75 $ 1,000 $28,375,750 $28,376,750
Partners' capital (deficit)
at December 31, 1994 28,371.75 $(640,843) $ 6,557,789 $ 5,916,946
Cash distributions for the
six months ended June 30,
1995 -- (31,566) (1,020,632) (1,052,198)
Net income for the six
months ended June 30, 1995 -- 6,008 194,259 200,267
Partners' capital (deficit)
at June 30, 1995 28,371.75 $(666,401) $ 5,731,416 $ 5,065,015
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
4
<PAGE>
d) DAVIDSON GROWTH PLUS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income $ 200,267 $ 123,125
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 350,924 332,441
Amortization of discounts and loan costs 48,421 44,617
Minority interest in net income of joint
venture 31,752 25,651
Loss on disposal of property 3,099 --
Change in accounts:
Restricted cash 2,570 (5,490)
Accounts receivable 1,487 274,396
Escrows for taxes and insurance (52,909) (57,701)
Accounts payable (17,794) (49,667)
Tenant security deposit liabilities 2,057 5,490
Accrued taxes 28,922 58,551
Other liabilities (58,490) 40,351
Subordinated management fee 9,140 2,225
Net cash provided by
operating activities 549,446 793,989
Cash flows from investing activities:
Property improvements and replacements (95,374) (76,934)
Deposits to restricted escrows (10,423) (5,217)
Receipts from restricted escrows 10,326 34,644
Net cash used in
investing activities (95,471) (47,507)
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
5
<PAGE>
DAVIDSON GROWTH PLUS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1995 1994
<S> <C> <C>
Cash flows from financing activities:
Payments on mortgage notes payable $ (92,483) $ (85,695)
Distributions to partners (1,052,198) (175,172)
Distributions to minority interest (157,500) (93,532)
Loan costs -- (864)
Net cash used in financing
activities (1,302,181) (355,263)
Net (decrease) increase in cash (848,206) 391,219
Cash at beginning of period 1,978,073 1,328,490
Cash at end of period $ 1,129,867 $1,719,709
Supplemental disclosure of cash
flow information:
Cash paid for interest $ 497,993 $ 504,782
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
6
<PAGE>
e) DAVIDSON GROWTH PLUS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note A - 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 Item
310(b) of Regulation S-B. 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 the
Managing General Partner, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the six month period ended June
30, 1995, are not necessarily indicative of the results that may be
expected for the fiscal year ending December 31, 1995. For further
information, refer to the financial statements and footnotes thereto
included in the Partnership's annual report on Form 10-KSB for the
fiscal year ended December 31, 1994.
Certain reclassifications have been made to the 1994 information to
conform to the 1995 presentation.
Note B - Transactions with Affiliated Parties
Affiliates of Insignia Financial Group, Inc. ("Insignia") own the
controlling ownership interest in the Partnership s Managing General
Partner, with certain affiliates of Insignia providing property
management and asset management services to the Partnership.
The following payments were made to Insignia and its affiliates for
the six months ended June 30, 1995, and June 30, 1994:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Property management fees $120,489 $114,218
Data processing services 1,319 1,000
Marketing services 1,847 3,142
Reimbursement for services
of affiliates 77,521 67,338
</TABLE>
7
<PAGE>
DAVIDSON GROWTH PLUS, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Note B - Transactions with Affiliated Parties
The Partnership insures its properties under a master policy through
an agency and insurer unaffiliated with the Managing General Partner.
An affiliate of the Managing General Partner acquired, in the
acquisition of a business, certain financial obligations from an
insurance agency which was later acquired by the agent who placed the
current year's master policy. The current agent assumed the financial
obligations to the affiliate of the Managing General Partner, who
receives payments on these obligations from the agent. The amount of
the Partnership's insurance premiums accruing to the benefit of the
affiliate of the Managing General Partner by virtue of the agent's
obligations is not significant.
Subordinated partnership management fees of $156,777 had not been
paid to the Managing General Partner as of June 30, 1995. Of this
amount, $9,140 relates to the six months ended June 30, 1995.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's investment properties consist of three apartment
complexes. The following table sets forth the average occupancy of the
properties for the six months ended June 30, 1995, and June 30, 1994:
<TABLE>
<CAPTION>
Average
Occupancy
1995 1994
<S> <C> <C>
The Fairway Apartments
Plano, Texas 97% 96%
The Village Apartments
Brandon, Florida 98% 96%
Brighton Crest Apartments
Marietta, Georgia 95% 95%
</TABLE>
The Partnership had net income of $200,267 for the six months ended
June 30, 1995, compared to net income of $123,125 for the six months
ended June 30, 1994. The Partnership had net income of $40,343 for the
three months ended June 30, 1995, compared to net income of $41,325 for
the three months ended June 30, 1994. Rental income increased for the
three and six months ended June 30, 1995, due to slight increases in
occupancy and rental rates. The increase in other income for the six
months ended June 30, 1995, was primarily due to a tax refund received
in the first quarter for The Village as a result of a property value
reassessment. Also, the increase was impacted by increases in interest
income due to higher average cash balances during the six months ended
June 30, 1995.
The decrease in operating expenses was due to decreases in
miscellaneous administrative costs such as office supplies and training
and travel costs at The Fairway and Brighton Crest. The increase in
maintenance expense was due to landscaping and fencing projects
totalling approximately $40,000 at Brighton Crest along with some
interior and exterior painting of several of the apartment units. In
addition, The Fairway replaced all of the tenant mailboxes and planted
several trees at a cost of approximately $20,000 during the second
quarter. The loss on disposal of property related to roof replacements
at The Fairway.
As part of the ongoing business plan of the Partnership, the Managing
General Partner monitors the rental market environment of each of its
investment properties to assess the feasibility of increasing rents,
maintaining or increasing occupancy levels and protecting the
Partnership from increases in expense. As part of this plan, the
Managing General Partner attempts to protect the Partnership from the
burden of inflation-related increases in expenses by increasing rents
and maintaining a high overall occupancy level. However, due to
changing market conditions, which can result in the use of rental
concessions and rental reductions to offset softening market conditions,
there is no guarantee that the Managing General Partner will be able to
sustain such a plan.
The Partnership had unrestricted cash of $1,129,867 for the six
months ended June 30, 1995, as compared to unrestricted cash of
$1,719,709 for the corresponding period of 1994. Net cash provided by
operating activities
9
<PAGE>
decreased due to fewer collections on accounts
receivable and increased payments of other liabilities. Net cash used
in investing activities increased due to increased property improvements
and replacements and reduced receipts from restricted escrows. Net cash
used in financing activities increased primarily due to increased
partner distributions.
The sufficiency of existing liquid assets to meet future liquidity
and capital expenditure requirements is directly related to the level of
capital expenditures required at the property to adequately maintain the
physical assets and other operating needs of the Partnership. Such
assets are currently thought to be sufficient for any near-term needs of
the Partnership. The mortgage indebtedness of $12,397,005, net of
discount, is amortized over 21.42 years to 28.67 years with balloon
payments due in 2002 and 2003 at which time the individual properties
will either be refinanced or sold. Future cash distributions will
depend on the levels of net cash generated from operations, property
sales and the availability of cash reserves. Cash distributions of
$1,052,198 to the partners and $157,500 to the minority interest holder
were paid during the six months ended June 30, 1995.
10
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit
to this report.
b) Reports on Form 8-K:
None filed during the quarter ended June 30, 1995.
11
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the
Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DAVIDSON GROWTH PLUS L.P.
BY: DAVIDSON DIVERSIFIED PROPERTIES, INC.,
Managing General Partner
BY: /s/Carroll D. Vinson
Carroll D. Vinson
President
BY: /s/Robert D. Long, Jr.
Robert D. Long, Jr.
Controller and Principal
Accounting Officer
DATE: August 11, 1995
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
Davidson Growth Plus, L.P.'s 1995 Second Quarter 10-QSB and is qualified
in its entirety by reference to such 10-QSB filing.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 1,084,092
<SECURITIES> 0
<RECEIVABLES> 6,817
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,496,625
<PP&E> 23,221,230
<DEPRECIATION> 7,267,999
<TOTAL-ASSETS> 18,449,626
<CURRENT-LIABILITIES> 505,833
<BONDS> 12,397,005
<COMMON> 0
0
0
<OTHER-SE> 5,065,015
<TOTAL-LIABILITY-AND-EQUITY> 18,449,626
<SALES> 0
<TOTAL-REVENUES> 2,453,450
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,218,332
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 546,414
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 200,267
<EPS-PRIMARY> 6.85
<EPS-DILUTED> 0
</TABLE>
