<PAGE>
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934.
For the fiscal year ended DECEMBER 31, 1996
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934.
For the transition period from _______ to_________.
Commission file number 33-8230
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
FLORIDA 59-2703685
(State or other jurisdiction of (IRS Employer Identification #)
incorporation or organization)
3001 EXECUTIVE DRIVE, SUITE 260, CLEARWATER, FL 34622
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (813) 573-1201
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
registered
NONE NONE
Securities registered pursuant to Section 12(g) of the Act:
NONE
(Title of class)
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 _____
There is no market for the registrant's securities and, therefore,
aggregate market value of the holdings of non-affiliates
cannot be determined.
Number of Units
Title of Each Class At December 31, 1996
UNITS OF LIMITED PARTNERSHIP 22,309
INTEREST: $250.00 PER UNIT
There are no documents incorporated by reference herein. Exhibit
Index is on page 12 of this report.
<PAGE>
PART I
ITEM 1. BUSINESS
General
Pioneer Western Properties Income Fund Limited
Partnership (the "Partnership") was formed pursuant to
the Uniform Limited Partnership Law of the State of
Florida on August 14, 1986. The Partnership currently
owns three apartment complexes ("Properties") -- Creek
Ridge Apartments in Knoxville, Tennessee; Foxwood
Apartments in Augusta, Georgia; and Pleasant Terrace
Apartments in Knoxville, Tennessee. The Partnership
does not intend to acquire any additional properties.
The Partnership's registration with the Securities and
Exchange Commission was declared effective on December
30, 1986 at which date the Partnership offered up to
40,000 units of Limited Partnership interests at $250
per unit, with a minimum purchase price of 12 units
($3,000) or 8 units ($2,000) for an Individual
Retirement Account. The Partnership commenced
operations on April 7, 1987 when the initial $1,586,250
was released from escrow and 130 investors were
admitted as Limited Partners. The Partnership continued
to raise funds from investors through the public
offering of its units until October 7, 1988 when 22,309
units had been sold with an aggregate purchase price of
$5,567,250. Investors were admitted as Limited Partners
upon acceptance of their subscriptions by the Corporate
General Partner. Limited Partners are not required to
make any additional capital contributions.
The Corporate General Partner is Pioneer Western
Properties Corporation ("PWPC"). The Individual General
Partner was Joseph A. Barringer until he assigned his
interest in the Partnership to PWPC effective January
13, 1989. The executive offices of the Corporate
General Partner and the Partnership are located at 3001
Executive Drive, Suite 260, Clearwater, Florida, 34622
and their telephone number is (813) 573-1201. For
further discussion regarding the sale of the Corporate
General Partner, see Item 13, "Certain Relationships
and Related Transactions," on page 11.
Current Operations
The overall average occupancy for the Partnership's
three Properties for 1996 was approximately 89% as
compared to 93% for 1995. Market rents were decreased
at the Knoxville Properties in 1996 to offset softening
demand for units in the market area. Property operating
expenses decreased during 1996 primarily due to lower
contract labor costs. Mortgage interest in 1996
decreased due to a refinancing transaction. Furnishings
(principally carpets and appliances) were replaced on a
routine basis as necessary at all Properties throughout
1996.
<PAGE>
Competition and Markets
In operating the Properties, the Partnership has
competition from numerous other apartments in the
respective areas. The Creek Ridge Apartments and the
Pleasant Terrace Apartments are located 1.1 miles from
each other in the western area of Knoxville, Tennessee,
and compete with approximately 12 apartment complexes
in the surrounding marketplace. The Foxwood Apartments
in the soutwest area of Augusta, Georgia, competes with
four apartment complexes. Refer to Item 2 for occupancy
information on the Properties.
Changes in Tax Laws
The effect of operations of the Partnership on the
limited partners is significantly affected by the
federal income tax laws, particularly the provisions of
the Internal Revenue Code of 1986, as amended. The Tax
Reform Act of 1986 made significant changes in federal
taxation, including changes in individual tax rates,
depreciation, capital gains treatment, limitation on
passive losses and the elimination of investment tax
credit.
The federal tax laws are constantly subject to change
by Congress and the interpretations of the Code may be
modified or affected by judicial decisions or by the
Treasury Department in its regulations and rules. Any
such changes may have an impact on the Partnership.
Management and Employees
The Partnership has no employees. On-site property
management services during 1996 were provided by LEDIC
Management Group, Inc., an unaffiliated property
management company located in Memphis, Tennessee. On-
site representatives were employed by LEDIC and the
Partnership reimbursed LEDIC for the direct payroll
cost of these employees. LEDIC employed approximately
eight individuals in connection with the operations of
the Properties. Prior to January 1, 1996, property
management services for the Properties was provided by
Edgemark Management Corporation, an affiliate of PWPC.
Partnership management services are provided by PWPC
(Corporate General Partner). PWPC has two employees.
Industry Segments and Foreign Operations
The Partnership is engaged in only one line of business
in one industry segment as described above. The
Partnership does not have any foreign operations.
<PAGE>
ITEM 2. PROPERTIES
As of December 31, 1996, the Partnership owed three
apartment complexes (referred to herein collectively as
the "Properties"):
1. Creek Ridge Apartments, Knoxville, Tennessee, is a 95 unit
apartment complex that was acquired by the Partnership on March
31, 1987.
2. Foxwood Apartments, Augusta, Georgia, is a 104 unit
apartment complex that was acquired by the Partnership on October
1, 1987.
3. Pleasant Terrace Apartments, Knoxville, Tennessee, is a 64
unit apartment complex that was acquired by the Partnership on
May 1, 1988 from PWPC for approximately $1,187,000.
CREEK RIDGE APARTMENTS, KNOXVILLE, TENNESSEE
General
The Creek Ridge Apartment complex is situated on
approximately 9.9 acres in Knox County, Tennessee, and
was constructed in 1973.
The following is a description of the units monthly
rental rates as of February 1997):
Advertised
Net Rentable Number Monthly
Unit Type Area (S.F.) of Units Rent
One Bed/One Bath 750 24 $350
Two Bed/One Bath 1,000 69 420
Three Bed/Two Bath 1,400 2 515
The Creek Ridge Apartment complex consists of five two-
story buildings. The development features a classical
architectural design with brick veneer construction.
Additional architectural features include wooden
balconies for upper level units and concrete patios for
lower level units. Adequate parking spaces are
provided. The amenities at the complex include laundry
facilities, a swimming pool, and a tennis court. Each
apartment unit includes a range and oven, refrigerator,
dishwasher, disposal and wall-to-wall carpeting. Forty-
eight percent of the units contain central heating and
air conditioning.
<PAGE>
CREEK RIDGE APARTMENTS, KNOXVILLE, TENNESSEE
(continued)
Occupancy and Rental Rates for the Past Five Years
The average occupancy rates for Creek Ridge Apartments
for each of the past five years were as follows: 1996-
95%; 1995-95%; 1994-96%; 1993-96%; and 1992-97%.
The average monthly (market) rental amount per square
foot for each of the past five years was as follows:
1996-$.43; 1995-$.48; 1994-$.45; 1993-$.43; and 1992-
$.40.
FOXWOOD APARTMENTS, AUGUSTA, GEORGIA
General
Foxwood Apartments is situated on approximately 8.55
acres in Richmond County, Georgia, and was constructed
in 1972.
The following is a description of the units (monthly
rental rates as of February 1997):
Advertised
Net Rental Number Monthly
Unit Type Area (S.F.) of Units Rent
One Bed/One Bath 884 24 $375
Two Bed/One Bath 984 80 425
The Foxwood Apartment complex consists of 13 two-story
buildings each containing eight garden-type units. The
buildings are of frame construction with brick
exterior. The roofs are a flat mansard design. Each
unit has a sliding glass door which opens onto a patio
or balcony. The amenities at the complex include
laundry facilities, a swimming pool, and a lighted
tennis court. Each apartment unit includes a
dishwasher, disposal, frost-free refrigerator, range
and oven, and wall-to-wall carpeting. Adequate parking
spaces are provided.
Occupancy and Rental Rates for the Past Five Years
The average occupancy rates for Foxwood Apartments for
each of the past five years were as follows: 1996-85%;
1995-89%; 1994-89%; 1993-92%; and 1992-94%.
The average effective annual rental amount per square
foot for each of the past five years was as follows:
1996-$.43; 1995-$.42; 1994-$.42; 1993-$.41; and 1992-
$.38.
<PAGE>
PLEASANT TERRACE APARTMENTS, KNOXVILLE, TENNESSEE
General
The Pleasant Terrace Apartment complex is situated on
approximately 5.62 acres in Knox County, Tennessee, and
was constructed in 1973.
The following is a description of the units (monthly
rental rates as of February 1997):
Advertised
Net Rental Number Monthly
Unit Type Area (S.F.) of Units Rent
One Bed/One Bath 650 24 $325
Two Bed/One Bath 850 32 375
Three Bed/One Bath 1,300 1 650
Duplexes 400-750 6 245
House 1,500 1 450
The Pleasant Terrace complex consists of six two-story
buildings, three duplexes, containing a total six
rental units, and one free-standing house. The
development features include concrete patios for lower
level units. Adequate parking spaces are provided. The
amenities at the complex include a swimming pool,
laundry facilities and cable TV availability. Each
apartment unit includes a range and oven, refrigerator,
disposal and wall-to-wall carpeting.
Occupancy and Rental Rates for the Past Five Years
The average occupancy rates for Pleasant Terrace
Apartments for each of the past five years were as
follows: 1996-90%; 1995-96%; 1994-93%; 1993-96%; and
1992-97%.
The average effective annual rental amount per square
foot for each of the past five years was as follows:
1996-$.45; 1995-$.49; 1994-$.47; 1993-$.43; and 1992-
$.42.
ITEM 3. LEGAL PROCEEDINGS
In November 1994, the Partnership received an
unfavorable ruling from the Circuit Court for Knox
County, Tennessee, Case No. 2-598-90, in the class
action brought by former and present tenants of Creek
Ridge Apartments against the Partnership, PWPC, Evans
Realty, Inc. (former property manager) and Joseph
Dixon. The action was filed on July 31, 1990 in Knox
County, Tennessee. The plaintiffs were seeking damages
of $6 million for damages they allege they suffered
resulting from a fire which destroyed one of the
apartment buildings on August 11, 1989. The court
awarded $300,000 to the plaintiffs. As of December 31,
1996, the remaining settlement amount totaled $50,000
and has been accrued. The Partnership has also accrued
an additional $120,000 for separate pending litigation
of the same nature.
<PAGE>
ITEM 3. LEGAL PROCEEDINGS (continued)
These amounts are covered by the Partnership's
insurance carrier and, accordingly, receivable for
these amounts has been recorded at December 31, 1996.
All amounts have been settled subsequent to year end.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS
No matters were submitted to a vote of security holders
during the fourth quarter of 1996 by means of a proxy
solicitation or otherwise.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND
RELATED
STOCKHOLDER MATTERS
There is presently no public market for the Limited
Partnership interests in the Partnership, and is not
anticipated that any public market will develop. As of
December 31, 1996, there were 553 Limited Partners in
the Partnership.
ITEM 6. SELECTED FINANCIAL DATA
The following is an unaudited schedule of selected
financial data for the Partnership as of and for the
years ended December 31, 1996, 1995, 1994, 1993, and
1992. The information below should be read in
conjunction with the financial statements and related
notes thereto and Management's Discussion and Analysis
of Financial Condition and Results of Operations
included as Item 7 in this Form 10-K.
(in thousands, except for per unit data)
1996 1995 1994 1993 1992
Operating Results
Revenues $1,066 $1,101 $1,113 $1,091 $1,022
Net income 143 154 173 162 128
Net income
per Limited
Partnership
unit (1) 6.07 6.57 7.36 6.91 5.45
Distributions
per limited
partnership
unit (1) 8.88 8.88 7.99 7.10 7.10
Net cash
provided by
operating
activities 309 344 376 344 261
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA (continued)
(in thousands, except for per unit data)
1996 1995 1994 1993 1992
Financial Condition
Total
assets 5,484 5,656 6,009 5,693 5,747
Mortgage notes
payable 1,185 1,277 1,350 1,416 1,477
(1) Per unit share data based upon 22,309 Limited
Partnership units outstanding for the years ended
December 31, 1996, 1995, 1994, 1993 and 1992.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Partnership's objectives are to preserve and
protect the Partnership's invested capital, to provide
partially tax-deferred distributions of cash from
operations on a quarterly basis and to achieve capital
appreciation. The Partnership raised a total of
$5,567,250 in 1987 and 1988 which was invested in three
Properties (after deduction of sales commissions,
certain fees and a working capital reserve). The
Partnership does not intend to acquire any additional
properties.
Results of Operations
The mortgage refinancing and early extinguishment of
debt in 1996 discussed below resulted in an
extraordinary loss of $27,376 which decreased net
income to $142,511 for the year ended December 31, 1996
from $154,309 for the year ended December 31, 1995.
Income before extraordinary item increased to $169,887
for the year ended December 31, 1996 from $154,309 for
the year ended December 31, 1995 due to a decrease in
operating expenses and interest expense. The
Partnership owned and operated all three of its
Properties for a full 12 month period in 1996, 1995 and
1994.
Income from operations before extraordinary item,
depreciation, and interest income and expense was
$443,551, $440,485 and $470,193 in 1996, 1995 and 1994,
respectively. Rental income decreased in 1996 due to
increased vacancies at Foxwood Apartments. Operating
expenses also decreased in 1996 due to lower contract
labor (refurbishing) costs.
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
Liquidity and Capital Resources
In April 1996, the Partnership refinanced its mortgage
debt on Creek Ridge Apartments using the proceeds to
payoff the old mortgage and early extinguish the
outstanding mortgage debt on Foxwood Apartments. The
interest rate on the Partnership's mortgage debt was
reduced to 8% and monthly debt service was reduced by
$6,617. At December 31, 1996, the Partnership had cash
and cash equivalents of $170,920. The Partnership had a
net decrease in cash and cash equivalents of $80,892
since December 31, 1995, resulting mainly from the
early extinguishment of debt.
The Corporate General Partner believes that liquid
assets available are adequate to meet future liquidity
and capital expenditure requirements. Future cash
distributions will depend on factors such as cash
generated from operations, property sales, debt
repayment and capital improvements. Cash distributions
of $200,001, $200,001 and $180,001 were paid during
1996, 1995 and 1994, respectively, and $50,001 was paid
in the first quarter of fiscal 1997 for fourth quarter
1996 operations.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this Item is included in
Item 14(a) of this report on Form 10-K. The selected
quarterly financial data and all other schedules are
omitted because they are not applicable.
ITEM 9. CHANGES IN AND DISAGREEMENT WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
The Partnership engaged LEDIC Management Group, Inc.
headquartered in Memphis, Tennessee, to provide
property management and accounting services effective
January 1, 1996. The books and records are being
maintained in Memphis and the Corporate General Partner
elected to engage a Memphis firm to provide audit and
tax services. Accordingly, Price Waterhouse LLP (Tampa,
Florida) was dismissed as the independent accountants
for the Partnership by letter dated September 20, 1996.
The report by Price Waterhouse LLP on the Partnership's
financial statements as of and for the years ended
December 31, 1995 and 1994 was unqualified and was not
modified as to uncertainty, audit scope, or accounting
principles.
The Partnership is a limited partnership and,
therefore, does not have any officers or directors. All
management functions of the Partnership are performed
by the Corporate General Partner who elected to make
the change.
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENT WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE (continued)
There were no disagreements with Price Waterhouse LLP
for the years ended December 31, 1995 and 1994 on any
matter of the accounting principles or practices,
financial statement disclosure, or auditing scope or
procedure nor any "reportable events" prior to the
change.
Rhea & Ivy, P.L.C. (Memphis, Tennessee) was engaged by
the Partnership by letter dated September 20, 1996. The
Partnership did not consult Rhea & Ivy, P.L.C. prior to
their engagement regarding the application of
accounting principles to a specified transaction or the
type of audit opinion that might be rendered on the
Partnership's financial statements.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE
REGISTRANT
The Partnership is a limited partnership and,
therefore, does not have any officers or directors. All
management functions of the Partnership are performed
by the Corporate General Partner. The following persons
are serving as officers, directors or key employees of
PWPC:
Name Age Title
Craig D. Caldwell 47 Director and Vice President
Rand E. McNeal 44 Director, President and
Chief Executive Officer
Craig D. Caldwell, served as Vice President of Westland
Insurance Brokers, a California corporation and a
regional commercial insurance agency until February
1991. Mr. Caldwell also previously served as Vice
President of Fund Administration for the Consolidated
Capital Companies until August 1983, which was at the
time the nation's largest real estate syndicator on a
new capital raised basis. He was also Assistant
Treasurer of Consolidated Capital Special Trust and
Consolidated Capital Income Trust, which at the time
were the two largest publicly traded real estate
investment trusts on a capital raised basis involved in
mortgage lending. Also, Mr. Caldwell was a tax manager
at Price Waterhouse and while working there for six
years, he specialized in real estate tax matters. Mr.
Caldwell has successfully converted a number of San
Francisco apartment buildings to condominiums and is a
Certified Public Accountant and a licensed real estate
broker. Mr. Caldwell graduated from UCLA with a
bachelor's degree in economics and a masters degree in
business administration in 1971 and 1972, respectively.
In 1976, he also graduated from USC with a masters
degree in business taxation. Mr. Caldwell presently
owns fifty percent of the outstanding stock of Edgemark
Group, Inc., the parent of PWPC.
<PAGE>
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE
REGISTRANT (continued)
Rand E. McNeal, served as Vice President of PWPC from
July 1985 until May 20, 1988, when he was elected
President and Chief Executive Officer, and served as a
Director of PWPC from July 1985 until July 1989 and was
reappointed as director in March 1991. Since May 1988,
Mr. McNeal has also served as Vice President of Pioneer
Western Corporation and has held various director and
officer positions with affiliates of PWPC. Mr. McNeal
is a Certified Public Accountant, a licensed real
estate broker, a licensed mortgage broker and formerly
served as the Chief Financial Officer of Trusty-
Baldasare, a Florida-based real estate developer, from
December 1980 until he joined PWPC in 1985. Mr. McNeal
was employed by Price Waterhouse from 1974 to 1979. Mr.
McNeal presently owns fifty percent of the outstanding
stock of Edgemark Group, Inc., the parent company of
PWPC.
ITEM 11. EXECUTIVE COMPENSATION
The Partnership is a limited partnership and,
therefore, has no officers or directors. Thus, the
Partnership pays no executive compensation. None of the
officers or directors of the Corporate General Partner
received any renumeration from the Partnership in 1996.
As the Managing General Partner, the Corporate General
Partner is entitled to receive a share in revenues, to
be compensated for services provided on a competitive
basis and to be reimbursed for certain direct expenses
and certain general and administrative expenses. (See
Item 13, "Certain Relationships and Related
Transactions," below.)
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
INTEREST OWNERS AND MANAGEMENT
No Limited Partner owns 5% or more of the outstanding
units. The Corporate General Partner directly owns
136.75 Limited Partnership units (.6%) and the officers
and directors of the Corporate General Partner own or
control another 277.74 Limited Partnership units (1.2%)
as of December 31, 1996. The Corporate General Partner
is not aware of any arrangements other than those
disclosed herein which may at a subsequent date result
in a change of control of the Partnership.
<PAGE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Corporate General Partner received cash
distributions totalling $2,000, management fees
totalling $10,538, and loan brokerage fees of $12,000
from the Partnership during the year ended December 31,
1996. No director or officer of the Corporate General
Partner, nor any associate of them, was indebted to the
Partnership at any time during the year ended December
31, 1996. The Corporate General Partner was a wholly-
owned subsidiary of Enstar Financial Services, Inc. On
March 19, 1991, Enstar Financial Services, Inc. sold
100% of the outstanding stock of PWPC to Edgemark
Group, Inc. The Corporate General Partner retained its
existing management. Edgemark Management Corporation,
an affiliate of the Corporate General Partner, received
management fees totalling $10,671 during the year ended
December 31, 1996.
<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
REPORTS ON FORM 10-K
Page
Reference
(a)(1)Financial Statements
Report of Independent Accountants
as of and for the years ended
December 31, 1996, 1995 and 1994 15
Balance Sheets as of December 31, 1996 and 1995 16
Statements of Income for the years ended
December 31, 1996, 1995 and 1994 17
Statements of Changes in Partners' Capital
for the years ended December 31, 1996,
1995 and 1994 18
Statements of Cash Flows for the years ended
December 31, 1996, 1995 and 1994 19-20
Notes to Financial Statements 21-26
(a)(2)Schedules
All schedules and other financial statements have
been omitted because they are not required or
because the information is presented in the
financial statements or related notes.
(b) Reports on Form 8-K
No filings of Form 8-K were made during the last
quarter of 1996.
(c) Exhibits
Exhibit
Number Exhibit
3.1 Second Amended and Restated
Certificate of Limited Partnership
(incorporated by reference from Form 10-K
filed for the year ended December 31, 1989)
16.1 Letter regarding change in certifying
accountant - filed herewith
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(a Florida Limited Partnership)
Financial Statements
For the Years Ended December 31, 1996, 1995 and 1994
<PAGE>
To the Partners
Pioneer Western Properties
Income Fund Limited Partnership
Report of Independent Accountants
We have audited the accompanying balance sheet of Pioneer Western
Properties Income Fund Limited Partnership (a Florida Limited
Partnership) as of December 31, 1996, and the related statements
of income, changes in partners' capital and cash flows for the
year then ended. These financial statements are the
responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial
statements based on our audit. The financial statements of
Pioneer Western Properties Income Fund Limited Partnership as of
December 31, 1995, and for each of the two years in the period
then ended, were audited by other auditors whose report dated
February 2, 1996, expressed an unqualified opinion on those
statements.
We conducted our audit 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 principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit
provides 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 Pioneer Western Properties Income Fund Limited Partnership as
of December 31, 1996, and the results of its operations and its
cash flows for the year then ended in conformity with generally
accepted accounting principles.
Memphis, Tennessee
February 26, 1997
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
BALANCE SHEETS
December 31, 1996 and 1995
1996 1995
Assets
Investments in real estate:
Land $ 680,000 $ 680,000
Buildings and furnishings,
net of accumulated depreciation
of $1,561,855 and $1,382,155 4,221,642 4,355,153
4,901,642 5,035,153
Cash and cash equivalents 170,920 251,812
Marketable debt securities 168,798 199,386
Insurance receivable 170,000 125,000
Other assets 72,288 44,308
$5,483,648 $5,655,659
Liabilities and Partners' Capital
Liabilities:
Accounts payable and
accrued expenses $ 19,990 $ 88,879
Accrued litigation reserve 170,000 125,000
Tenant security deposits 36,751 35,670
Mortgages on real estate 1,185,451 1,277,164
Total liabilities 1,412,192 1,526,713
Partners' Capital:
General partner 28,124 22,998
Limited partners 4,043,332 4,105,948
Total partners' capital 4,071,456 4,128,946
$5,483,648 $5,655,659
See Notes to Financial Statements.
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
STATEMENTS OF INCOME
For the Three Years Ended December 31, 1996, 1995 and 1994
1996 1995 1994
Revenues:
Rental income $1,052,908 $1,084,410 $1,106,010
Interest 12,723 16,196 7,336
1,065,631 1,100,606 1,113,346
Expenses:
Operating 565,602 608,613 601,947
General and administrative 43,755 35,312 33,870
Depreciation 179,700 175,799 171,764
Interest 106,687 126,573 133,024
895,744 946,297 940,605
Income before extraordinary
item 169,887 154,309 172,741
Extraordinary item - loss
from early extinguishment
of debt (27,376) - -
Net income $ 142,511 $ 154,309 $172,741
Net income allocable to:
General partner $ 7,126 $ 7,715 $ 8,637
Limited partners $ 135,385 $ 146,594 $164,104
Earnings (loss) per limited
partnership unit (based on
an average 22,309 limited
partnership units each
year):
Income before
extraordinary item $ 7.23 $ 6.57 $ 7.36
Extraordinary item $ (1.16) $ - $ -
Net income $ 6.07 $ 6.57 $ 7.36
See Notes to Financial Statements.
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the Three Years Ended December 31, 1996, 1995 and 1994
Limited General
Partners Partner Combined
Balance at January 1, 1994 $4,171,452 $ 10,446 $4,181,898
Distributions ($7.99 per avg
limited partnership unit) ( 178,201) ( 1,800) ( 180,001)
Net income 164,104 8,637 172,741
Balance at December 31, 1994 4,157,355 17,283 4,174,638
Distributions ($8.88 per avg
limited partnership unit) ( 198,001) ( 2,000) ( 200,001)
Net income 146,594 7,715 154,309
Balance at December 31, 1995 4,105,948 22,998 4,128,946
Distributions ($8.88 per avg
limited partnership unit) ( 198,001) ( 2,000) ( 200,001)
Net income 135,385 7,126 145,511
Balance at December 31, 1996 $4,043,332 $ 28,124 $4,071,456
See Notes to Financial Statements.
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS
For the Three Years Ended December 31, 1996, 1995 and 1994
1996 1995 1994
Operating activities:
Net income $ 142,511 $ 154,309 $172,741
Adjustments to reconcile net
income to net cash provided
by operating activities:
Extraordinary item 27,376 - -
Loss on disposal of asset - - 991
Depreciation 179,700 175,799 171,764
Changes in assets and
liabilities:
Insurance receivable (45,000) 250,000 (375,000)
Other assets 27,455 (1,577) 15,709
Accounts payable and
accrued expenses (68,889) 2,505 12,818
Tenant security deposits 1,081 12,860 1,737
Accrued litigation reserve 45,000 (250,000) 375,000
Total adjustments 166,723 189,587 203,019
Net cash provided by
operating activities 309,234 343,896 375,760
Investing activities:
Capital additions (46,189) (48,068) (65,908)
Purchase of debt securities (168,798) (199,386) -
Maturity of debt securities 199,386 - -
Net cash used in
investing activities (15,601) (247,454) (65,908)
(continued on next page)
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
STATEMENTS OF CASH FLOWS -- continued
1996 1995 1994
Financing activities:
Proceeds from mortgage
refinancing, net of
loan fees 1,144,565 - -
Premiums on early
extinguishment of debt (27,376) - -
Principal payments on
mortgages (1,291,713) (72,714) (66,313)
Distributions to partners (200,001) (200,001) (180,001)
Net cash used in financing
activities (374,525) (272,715) (246,314)
Net increase (decrease) in cash
and cash equivalents (80,892) (176,273) 63,538
Cash and cash equivalents:
Beginning of period 251,812 428,085 364,547
End of period $ 170,920 $ 251,812 $ 428,085
Supplemental disclosures
of cash flow information:
Cash paid during the period for
interest $ 105,154 $ 127,134 $ 133,535
See Notes to Financial Statements.
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Note (1) Partnership Organization and Operations
Pioneer Western Properties Income Fund Limited
Partnership (the Partnership), a Florida limited
partnership, was formed in August 1986. The purpose of
the Partnership is to purchase and operate existing
income producing multi-family properties through the
year ended December 31, 2036, unless terminated earlier
in accordance with the provisions of the partnership
agreement. Prior to January 1989, the General Partners
were Pioneer Western Properties Corporation (PWPC), the
Corporate General Partner, and Joseph A. Barringer, the
Individual General Partner. Mr. Barringer withdrew as
the Individual General Partner in January 1989 and
assigned his general partner interest to PWPC. On March
19, 1991, Enstar Financial Services, Inc. sold 100% of
the outstanding stock of PWPC to Edgemark Group, Inc.
On December 30, 1986, the Securities and Exchange
Commission declared the Partnership's registration
statement, which contemplated the sale of $10 million
in limited partner interests, to be effective. In April
1987, the Partnership reached the minimum of 6,000
units sold and commenced its operations. The offering
period ended in October 1988 with 22,309 units sold and
proceeds of $5,567,250.
Note (2) Summary of Significant Accounting Policies
Basis of Presentation
The Partnership's accounting records are maintained on
an accrual basis of accounting in accordance with
generally accepted accounting principles.
The process of preparing financial statements in
conformity with generally accepted accounting
principles requires the use of estimates and
assumptions regarding certain types of assets,
liabilities, revenues, and expenses. Such estimates
primarily relate to unsettled transactions and events
as of the date of the financial statements.
Accordingly, upon settlement actual results may differ
from estimated amounts.
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note (2) Summary of Significant Accounting Policies
(continued)
Allocation of Profits and Losses
Profits and losses of the Partnership, other than those
attributable to capital items or the disposition of
substantially all of the Partnership's property, are
allocated 95% to the limited partners and 5% to the
general partner. Profits and losses of the Partnership
attributable to capital items or the disposition of
substantially all of the Partnership's property are to
be distributed as follows: (1) to previously allocated
tax loss from sales: (2) to limited partners in an
amount equal to the excess of cash available for
distribution received by them over the taxable income
from operations allocated to them; (3) to the limited
partners in an amount equal to the excess of the 8%
cumulative priority return to which they are entitled
over the cash available for distribution received by
them; (4) to the general partner in an amount equal to
the excess of the cash available for distribution
received over the taxable income from operations
allocated to the general partner; (5) 80% to the
limited partners and 20% to the general partner.
Cash available for distribution will be paid 99% to the
limited partners and 1% to the general partner until
the limited partners have received their 8% annual
priority return, and 95% to the limited partners and 5%
to the general partner, thereafter.
Investments in Real Estate
Buildings and furnishings are stated at cost less
accumulated depreciation. Buildings and improvements
are depreciated on the straight-line method over 40
years; the furnishings are depreciated on straight-line
and 150% declining balance methods over 10 years; and
property improvements are depreciated on the straight-
line method over 20 years.
Cash and Cash Equivalents
The Partnership considers all short-term highly liquid
instruments purchased with a maturity of three months
or less to be cash equivalents.
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note (2) Summary of Significant Accounting Policies
(continued)
Other Assets
The Partnership's other assets are comprised of the
following:
December 31,
1996 1995
Accounts receivable $ - $ -
Interest receivable - 3,450
Rent receivables - 15,121
Escrow deposits 16,853 18,801
Prepaid insurance - 6,747
Deferred loan costs 55,435 189
$ 72,288 $ 44,308
Deferred loan costs are amortized on the straight-line
method over the mortgage loan period.
Uncollectible rent of $47,996, $57,346, and $35,161 was
written-off against rental income in 1996, 1995, and
1994, respectively.
Syndication Costs
Syndication and offering costs were charged against
limited partners' equity at inception of the
Partnership.
Marketable Debt Securities
The Partnership invests excess cash in U.S. Treasury
securities that are considered to be "held-to-maturity"
and, therefore, stated at amortized cost. At December
31, 1996 and 1995, the following securities were owned:
Maturity
Description Principal Yield Date
1996
U.S. Treasury Bill $169,000 5.46% 1/97
1995
U.S. Treasury Bill $200,000 4.63% 2/96
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note (2) Summary of Significant Accounting Policies
(continued)
Income Taxes
No provision has been made for income taxes as the tax
effect of the Partnership's activities accrues to the
Partners.
Note (3) Investments in Real Estate
The cost and accumulated depreciation of the
Partnership's properties at December 31, 1996, is as
follows:
Buildings
and Accumulated
Land Furnishings Total Depreciation
Creek Ridge
Apartments $230,000 $1,952,346 $2,182,346 $ 549,867
Foxwood
Apartments 315,000 2,620,403 2,935,403 693,582
Pleasant Terrace
Apartments 135,000 1,210,748 1,345,748 318,406
Total $680,000 $5,783,497 $6,463,497 $1,561,855
Note (4) Mortgages on Real Estate
At December 31, 1995, the Partnership had the following
mortgage debt:
Principal Maturity Interest
Outstanding Date Rate
Creek Ridge
Apartments $754,996 11-1-97 10.125%
Foxwood
Apartments $522,168 10-20-02 9.0%
In April 1996, the Partnership completed a refinancing
of the mortgage debt on Creek Ridge Apartments. The net
proceeds were as follows (in thousands):
Amount of new debt $1,200
Payoff "old" mortgage including premiums
and accrued interest (761)
Loan fees and escrow (79)
$ 360
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note (4) Mortgages on Real Estate (continued)
The net proceeds of approximately $360,000 plus other
available funds were used to payoff the mortgage debt
on Foxwood Apartments. The amount of the mortgage debt
that was extinguished early was approximately $497,000
plus approximately $19,000 in premiums and $3,000 of
accrued interest. The new mortgage debt on Creek Ridge
Apartments is payable in monthly installments of
principal and interest (8%) through May 1, 2016 (20
years); is collateralized by real property; and is
subject to prepayment penalties.
Aggregate principal payments due on the mortgage debt
are as follows:
1997 $ 26,572
1998 28,777
1999 31,165
2000 33,752
2001 36,554
Thereafter 1,028,631
$ 1,185,451
Note (5) Commitments and Contingencies
In November 1994, the Partnership received an
unfavorable ruling related to litigation surrounding a
fire at Creek Ridge Apartments. As of December 31,
1996, the remaining settlement amount totaled $50,000
and was accrued. The Partnership also accrued an
additional $120,000 for separate pending litigation of
the same nature. These amounts are covered by the
Partnership's insurance carrier and, accordingly, an
insurance receivable for these amounts was recorded at
December 31, 1996. All amounts were settled subsequent
to year end.
Note (6) Related Party Transactions
The Partnership incurred $10,538, $10,844 and $11,028
in partnership management fees for services provided by
the Corporate General Partner for 1996, 1995 and 1994,
respectively. Edgemark Management Corporation, an
affiliate of the Corporate General Partner, earned
property management fees in the amount of $10,671,
$54,221 and $58,186 from the Partnership during 1996,
1995 and 1994, respectively, and administrative
services fees (for tax services)in the amount of $4,000
for both 1995 and 1994. Edgemark Management Corporation
also received a loan brokerage fee of $12,000 in 1996.
<PAGE>
PIONEER WESTERN PROPERTIES INCOME FUND LIMITED PARTNERSHIP
(A Florida Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Note (6) Related Party Transactions (continued)
Effective January 1, 1996, the Corporate General
Partner engaged LEDIC Management Group, Inc. (not
affiliated with the Corporate General Partner) as
subagent for the management of the Partnership's
properties.
<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.
Pioneer Western Properties Income Fund Limited Partnership,
a Florida limited partnership (Registrant)
By: Pioneer Western Properties Corporation
("PWPC"), its Corporate General Partner
March 31,1997 By: Rand E. McNeal
Rand E. McNeal, President and CEO
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
dates indicated.
March 31, 1997 By: Craig D. Caldwell
Craig D. Caldwell, Director of PWPC
March 31, 1997 By: Rand E. McNeal
Rand E. McNeal, President and CEO
<PAGE>
Exhibit 16.1
Securities and Exchange Commission
450 Fifth Street N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
We have read Item 4 of Pioneer Western Properties
Income Fund Limited Partnership's Form 8-K, dated
September 24, 1996 and are in agreement with the
statements contained therein.
Very truly yours,
Price Waterhouse, LLP
Tampa, Florida
September 24, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 170,920
<SECURITIES> 168,798
<RECEIVABLES> 170,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 6,463,497
<DEPRECIATION> 1,561,855
<TOTAL-ASSETS> 5,483,648
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 5,483,648
<SALES> 0
<TOTAL-REVENUES> 1,065,631
<CGS> 0
<TOTAL-COSTS> 789,057
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 106,687
<INCOME-PRETAX> 169,887
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 27,376
<CHANGES> 0
<NET-INCOME> 142,511
<EPS-PRIMARY> 6.07
<EPS-DILUTED> 6.07
</TABLE>
