UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended June 30, 1995
Commission file Number 0-16820
FIRST DEARBORN INCOME PROPERTIES L.P.
(Exact name of registrant as specified in its charter.)
ILLINOIS 36-3473943
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
154 West Hubbard, Suite 250 Chicago, IL 60610
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 464-0100
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 [ ]
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical date:
Units Outstanding as of June 30, 1995: 20,468.5
<PAGE>
<TABLE>
PART I. - FINANCIAL INFORMATION
FIRST DEARBORN INCOME PROPERTIES L.P.
BALANCE SHEETS
June 30, 1995 and December 31, 1994
(Unaudited)
ASSETS
<CAPTION>
June 30, December 31,
1995 1994
<S> <C> <C>
Current assets:
Cash and cash equivalents (note 1) 336,370 509,641
Rents and other receivables 809,891 940,710
Due from affiliates 6,826 5,037
Prepaid expense 0 9,007
Total current assets 1,644,949 1,464,395
Investment property, at cost (note 1):
Land 2,273,114 2,273,114
Building 15,604,195 15,585,295
17,877,309 17,858,409
Less accumulated depreciation (4,580,355) (4,316,293)
13,296,954 13,542,116
Investment in unconsolidated venture,
at equity (note 2) 871,805 937,948
Deferred rents receivable 1,595,860 1,745,646
Deferred loan costs 50,743 36,835
Total assets 16,968,449 17,726,940
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
FIRST DEARBORN INCOME PROPERTIES L.P.
(a limited partnership)
and Consolidated Ventures
Balance Sheets
June 30, 1995 and December 31, 1994
(Unaudited)
Liabilities and Partners' Capital Accounts
<CAPTION>
June 30, December 31,
1995 1994
<S> <C> <C>
Current liabilities:
Accounts payable and accrued expenses 187,483 213,738
Due to affiliates (note 3) 224,567 220,689
Accrued interest 28,275 68,832
Current portion of long-term debt 4,446,400 4,856,937
Total current liabilities 4,886,725 5,626,375
Long-term debt 4,545,368 4,586,785
Venture partners' equity in
consolidated venture (note 2) 1,405,585 1,356,596
Deposits 118,947 118,947
Total long-term liabilities 6,069,900 6,062,328
Total liabilities 10,956,625 11,422,524
Partners' capital accounts (deficits) (note 1):
General partners:
Cumulative net losses 440 1,835
440 1,835
Limited partners:
Capital contributions 8,800,461 8,800,461
Cumulative net income (losses) 51,018 189,107
Cumulative cash distributions (2,840,095) (2,686,987)
6,011,384 6,302,581
Total partners' capital accounts 6,011,824 6,304,416
Commitments and contingencies (note 2)
Total Liabilities and Partners' Capital 16,968,449 17,726,940
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
FIRST DEARBORN INCOME PROPERTIES L.P.
(a limited partnership)
and Consolidated Ventures
Consolidated Statement of Operations
Three months ended June 30, 1995 and 1994
(Unaudited)
<CAPTION>
1995 1994
<S> <C> <C>
Revenues:
Rental income 326,733 410,391
Tenant charges 22,690 23,794
Interest income 32,091 2,539
Total revenues 381,514 436,724
Expenses:
Property operating expenses 114,182 65,821
Interest 203,122 220,108
Depreciation 142,624 143,772
Amortization 5,311 5,312
General and administrative expenses 52,756 51,353
Total expenses 517,995 486,365
Operating loss (136,481) (49,641)
Partnership's share of oprations
of unconsolidated ventures 48,693 10,129
Venture partner's share of consolidated
venture's operations 1,823 (11,662)
Net loss (85,965) (51,174)
Net loss per limited partnership unit (4.16) (2.48)
Cash distribution per limited partnership unit 3.74 3.74
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
FIRST DEARBORN INCOME PROPERTIES L.P.
(a limited partnership)
and Consolidated Ventures
Consolidated Statement of Operations
Six months ended June 30, 1995 and 1994
(Unaudited)
<CAPTION>
1995 1994
<S> <C> <C>
Revenues:
Rental income 655,325 830,367
Tenant charges 49,294 48,338
Interest income 64,833 4,826
Total revenues 769,185 883,531
Expenses:
Property operating expenses 182,796 142,119
Interest 408,937 444,720
Depreciation 264,062 265,831
Amortization 10,623 10,623
General and administrative expenses 95,398 80,310
Total expenses 961,816 943,603
Operating loss (192,631) (60,072)
Partnership's share of operations
of unconsolidated ventures 63,951 22,322
Venture partner's share of consolidated
venture's operations (note 1) (10,804) (23,803)
Net income (loss) (139,484) (61,553)
Net income (loss) per
limited partnership unit (note 1) $ (6.75) (2.98)
Cash distribution per
limited partnership unit $ 7.48 7.48
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
FIRST DEARBORN INCOME PROPERTIES L.P.
(a limited partnership)
and Consolidated Ventures
Consolidated Statements of Cash Flows
Six months ended June 30, 1995 and 1994
(Unaudited)
<CAPTION>
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) (139,484) (61,553)
Items not requiring (providing)
cash or cash equivalents:
Depreciation 264,062 265,831
Amortization 10,623 10,623
Partnership's share of operations of
unconsolidated venture 66,143 51,215
Venture partners' share of
consolidated venture's operations 48,989 615
Changes in:
Rents and other receivables 130,819 107,325
Prepaid expenses 9,007 10,160
Deferred rents receivable 149,786 0
Accounts payable and accrued expenses (65,812) (45,075)
Due to affiliates 2,089 16,033
Unearned revenues 0 (71,245)
Tenant deposits 0 0
Net cash provided by (used in)
operating activities 475,222 283,929
Additions to building: (18,900) (6,666)
Cash flows from financing activities:
Payment of deferred loan costs (24,531) 0
Distributions to limited partners (153,108) (153,108)
Principal payments on long-term debt (451,954) (59,246)
Net cash used in financing activities (629,593) (212,354)
Net increase (decrease)
in cash and cash equivalents (173,271) 64,909
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
<PAGE>
FIRST DEARBORN INCOME PROPERTIES L.P.
(a limited partnership)
and Consolidated Ventures
Notes to Consolidated Financial Statements
June 30, 1995 and 1994
(Unaudited)
Readers of this quarterly report should refer to the Partnership's
audited financial statements for the fiscal year ended December 31, 1994,
which are included in the Partnership's 1994 Annual Report, as certain
footnote disclosures which would substantially duplicate those contained
in such audited financial statements have been omitted from this report.
(1) Basis of Accounting
For the three and six month periods ended June 30, 1995 and June 30, 1994,
the accompanying consolidated financial statements include the accounts of
the Partnership and its consolidated ventures - Vero Beach Associates and
Downers Grove Building Partnership. The effect of all transactions between
the Partnership and the Ventures has been eliminated.
The equity method of accounting has been applied in the accompanying
consolidated financial statements with respect to the Partnership's interest
in Sycamore Mall Associates.
The Partnership records are maintained on the accrual basis of accounting
as adjusted for Federal income tax reporting purposes. The accompanying
consolidated financial statements have been prepared from such records after
making appropriate adjustments, where applicable, to present the Partnership's
accounts in accordance with generally accepted accounting principles (GAAP).
Such adjustments are not recorded on the records of the Partnership. The
net effect of these adjustments for the three and six month periods ended
June 30, 1995 and 1994 is summarized as follows:
<TABLE>
<CAPTION>
1995 1995 1994 1994
GAAP Tax GAAP Tax
Basis Basis Basis Basis
<S> <C> <C> <C> <C>
Net income (loss) (139,484) (185,000) (61,553) (106,500)
Net income (loss) per
limited partnership unit (6.75) (8.95) (2.98) (5.15)
</TABLE>
The net loss per limited partnership unit presented is based on the
weighted limited partnership units outstanding at the end of each period
(20,468.5).
Partnership distributions from unconsolidated ventures are considered
cash flow from operating activities to the extent of the Partnership's
cumulative share of net operating earnings before depreciation and non-cash
items. In addition, the Partnership records amounts held in U.S. Government
obligations, commercial paper and certificates of deposit at cost which
approximates market. For the purposes of these statements, the Partnership's
policy is to consider all such investments, with an original maturity of three
months or less, ($287,574 and $187,663 at June 30, 1995 and December 31, 1994,
respectively) as cash equivalents.
<PAGE>
FIRST DEARBORN INCOME PROPERTIES L.P.
(a limited partnership)
and Consolidated Ventures
Notes to Consolidated Financial Statements - Continued
Deferred offering costs were charged to the partners' capital accounts
upon consummation of the offering. Deferred organization costs are amortized
over a 60-month period using the straight-line method. Deferred loan costs
are amortized over the terms of the related agreements using the straight-line
method.
Depreciation on the investment properties acquired has been provided
over the estimated useful lives of 5 to 30 years using the straight-line
method.
No provision for Federal income taxes has been made as any liability
for such taxes would be that of the partners rather than the Partnership.
(2) Venture Agreements
The Partnership has entered into three joint venture agreements with
partnerships sponsored by affiliates of the General Partners. Pursuant to
such agreements, the Partnership has made capital contributions aggregating
$7,685,642 through June 30, 1995. The Partnership has acquired, through
these ventures, interests in two shopping centers and an office building
partnership.
(3) Transactions with Affiliates
Fees, commissions and other expenses required to be paid by the
Partnership to affiliates of the General Partners for the six months
ended June 30, 1995 and 1994 are as follows:
<TABLE>
<CAPTION>
1995 1994 6/30/95
<S> <C> <C> <C>
Non-accountable expense reimbursement 12,794 12,794 215,730
Reimbursement (at cost) for
administrative services 8,500 17,884 8,827
21,294 30,678 224,557
</TABLE>
(4) Unconsolidated Ventures - Summary Information
Summary income statement information for Sycamore Mall Associates for
the six months ended June 30, 1995 and 1994 is as follows:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Total revenue 930,172 898,084
Operating income (loss) 148,201 88,441
Partnership's share of income 63,951 22,322
</TABLE>
<PAGE>
FIRST DEARBORN INCOME PROPERTIES L.P.
(a limited partnership)
and Consolidated Ventures
Notes to Consolidated Financial Statements - Continued
(5) Adjustments
In the opinion of the Managing General Partner, all adjustments
(consisting solely of normal recurring adjustments) necessary for a fair
presentation have been made to the accompanying consolidated financial
statements as of June 30, 1995 and 1994.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Resulting of Operations
Liquidity and Capital Resources
At June 30, 1994, the Partnership had cash and cash equivalents
of $336,370 which will be utilized for working capital requirements and for
future distributions to Partners. This is more than the $509,641 balance at
December 31, 1994. The decrease is primarily due to the repayment of
long-term debt.
As the Partnership intends to distribute all "net cash receipts" and
"sales proceeds" in accordance with the terms of the Partnership Agreement,
and does not intend to reinvest any such proceeds, the Partnership is
intended to be self-liquidating in nature. The Partnership's future source
of liquidity and distributions is expected to be through cash generated by
the Partnership's investment properties and from the sale and refinancing
of such properties. To the extent that additional payments are required under
a purchase agreement or a property does not generate an adequate cash flow
to meet its requirements, the Partnership may withdraw funds from the working
capital reserve which it maintains.
In August 1995, the Partnership completed the refinancing of the mortgage
indebtedness at the Downers Grove property. The loan is in the amount of
$4,586,044 and accrues interest at the annual rate of 9.125%. The loan
provides for the first six monthly payments of interest only in the amount
of $34,873. The next thirty monthly payments of principal and interest
be $55,170 and the final 84 monthly payments of principal and interest
would be $58,405. The loan will mature in August 2005 and a final principal
payment of $600,234 would be due at that time. The completion of this
refinancing substantially improves working capital of the Partnership by
providing long term financing for this property. The net rentals to be
received from this property are sufficient to pay the debt service.
Results of Operations
For the three and six month periods ended June 30, 1995 and June 30, 1994
the accompanying consolidated financial statements include the accounts of
the Partnership and its consolidated ventures - Vero Beach Associates and
Downers Grove Building Partnership. The effect of all transactions between
the Partnership and the Ventures has been eliminated.
The equity method of accounting has been applied in the accompanying
consolidated financial statements with respect to the Partnership's interest
in Sycamore Mall Associates.
The $83,658 and $175,309 decreases in rental income for the three and
six month periods ended June 30, 1995, respectively, as compared to the
three and six month periods ended June 30, 1994 is primarily attributable
to lower rental rates paid by the new tenant at the Downers Grove property.
The $29,552 and $60,007 increases in interest income for the three and
six month periods ended June 30, 1995, respectively, as compared to the
three and six month periods ended June 30, 1994 is attributable to the
annuities purchased in connection with the lease buy out at the Downers
Grove property.
<PAGE>
The $40,677 increase in property operating expense for the six months
ended June 30, 1995 as compared to the six months ended June 30, 1994
is primarily attributable to expenses incurred at the Downers Grove property.
The $35,783 decrease in interest expense for the six month period
ended June 30, 1995 as compared to the six month period ended June 30, 1994
is primarily attibutable to the reduction in mortgage indebtedness at the
Downers Grove property.
The $15,088 increase in general and administrative expense for the
six months ended June 30, 1995 as compared to the six months ended
June 30, 1994 is primarily attributable to professional fees incurred
at the Downers Grove property.
The $41,629 increase in Partnership's share of operations of
unconsolidated ventures for the six months ended June 30, 1995 as compared
to the six months ended June 30, 1994 is attributable to improved occupancy
at Evanston Galleria.
The Consolidated Staement of Cash Flows includes $149,786 of cash
provided during the six month period ended June 30, 1995 and no amount for
the six month period ended June 30, 1994. These cash flows result from
payments received from the annuities which were established, at the Downers
Grove property, in conjunction with the lease termination of the prior
tenant.
During the six month period ended June 30, 1995, the Partnership paid
$24,531 which was recorded as a deferred loan cost. This payment relates to
an application for a refinancing of the mortgage indebtedness at the Downers
Grove property.
During the six months ended June 30, 1995, payments to reduce long term
debt totalled $451,954 as compared to $59,246 during the six months ended
June 30, 1994. This reduction relates to the Downers Grove property and the
agreement with the lender on that property to accelerate the reduction of the
mortgage indebtedness. This accelerated debt reduction was in consideration
for an extension of the maturity date on the loan.
<TABLE>
OCCUPANCY
The following is a list of approximate occupancy levels by quarter
for the Partnership's investment properties:
<CAPTION>
at at at at at at at
3/31/94 6/30/94 9/30/94 12/31/94 3/31/95 6/30/95 09/30/95
<S> <C> <C> <C> <C> <C> <C>
Indian River Plaza
Vero Beach, FL 96% 99% 99% 99% 99% 99%
Reichhold Building
Downers Grove, IL 100% 100% 100% 100% 100% 100%
Sycamore Mall
Iowa City, Iowa 98% 97% 97% 96% 96% 98%
</TABLE>
<PAGE>
Part II - OTHER INFORMATION
Items 1, 2, 3, 4, and 5 of Part II are omitted because of the absence of
conditions under which they are required.
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
None
b) Reports on Form 8-K
No reports on Form 8-K were filed for the period covered by this report.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Partnership has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
FIRST DEARBORN INCOME PROPERTIES L.P.
(Registrant)
BY: FDIP, Inc.
(Managing General Partner)
August 22, 1995 BY: Robert S. Ross
Robert S. Ross
President
(Principal Executive Officer)
August 22, 1995 BY: Bruce H. Block
Bruce H. Block
Vice President
(Principal Financial Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<FISCAL-YEAR-END> Dec-31-1995
<PERIOD-START> Apr-01-1995
<PERIOD-END> Jun-30-1995
<PERIOD-TYPE> 3-MOS
<CASH> 336,370
<SECURITIES> 0
<RECEIVABLES> 809,891
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,153,087
<PP&E> 17,877,309
<DEPRECIATION> 4,580,355
<TOTAL-ASSETS> 16,968,449
<CURRENT-LIABILITIES> 4,886,725
<BONDS> 4,545,368
0
0
<COMMON> 0
<OTHER-SE> 6,011,824
<TOTAL-LIABILITY-AND-EQUITY> 16,968,449
<SALES> 349,423
<TOTAL-REVENUES> 381,514
<CGS> 0
<TOTAL-COSTS> 262,117
<OTHER-EXPENSES> 52,756
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 203,122
<INCOME-PRETAX> (85,965)
<INCOME-TAX> 0
<INCOME-CONTINUING> (85,965)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (85,965)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
