<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER 33-11013
ASSOCIATED PLANNERS REALTY INCOME FUND, (A CALIFORNIA LIMITED
PARTNERSHIP)
(Exact name of registrant as specified in its charter)
CALIFORNIA 95-4120092
State or other jurisdiction of (IRS Employer
incorporation or organization Identification)
5933 WEST CENTURY BLVD., 9TH FLOOR, LOS ANGELES, CA 90045-5454
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310) 670-0800
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:
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of class)
Indicate by check mark whether the registrant (1) has filed all reports 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 u 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 [ ]
<PAGE>
PART I
ITEM 1. BUSINESS
Associated Planners Realty Income Fund (the "Partnership"), was organized in
December 1986, under the California Revised Limited Partnership Act. West Coast
Realty Advisors, Inc. ("WCRA"), a California corporation, and W. Thomas Maudlin
Jr., an individual, are general partners (collectively referred to herein as the
"General Partner").
The Partnership was organized for the purpose of investing in, holding, and
managing improved, unleveraged income-producing property, such as residential
properties, office buildings, commercial buildings, industrial properties, mini-
warehouse facilities, and shopping centers ("Properties"), which are believed to
have potential for cash flow and capital appreciation. The Partnership intends
to own and operate such Properties for investment over an anticipated holding
period of approximately five to ten years. At December 31, 1995, the
Partnership had no employees.
The Partnership's principal investment objectives are to invest the net
proceeds in real properties which will:
1. Preserve and protect the Partnership's invested capital;
2. Provide for cash distributions from operations;
3. Provide gains through potential appreciation; and
4. Generate federal income tax deductions so that a portion of cash
distributions may be treated as a return of capital for tax
purposes and, therefore, may not represent taxable income to the
Limited Partners.
On October 25, 1988. the Partnership acquired a 100% interest in a shopping
center located in Chino, California. On January 9, 1990, the Partnership,
together with Associated Planners Realty Growth Fund (an affiliate), purchased a
one-story building located in San Marcos, California. The acquisition was paid
for entirely in cash totaling $3,118,783 of which $2,806,905 was provided by the
Partnership and $311,878 by the affiliate. The Partnership owns a 90% undivided
interest in the property.
The ownership and operation of any income-producing real estate is subject to
those risks inherent in all real estate investments. These include national and
local economic conditions, the supply of and demand for similar types of real
property, competitive marketing conditions, zoning changes, possible casualty
losses, and increases in real estate taxes, assessments, and operating expenses,
as well as others. In addition, the real estate market at this date is in a
general state of uncertainty, and there is no assurance as to how long it might
continue or its possible effect on the Partnership.
<PAGE>
This uncertainty is evidenced by the following conditions:
1. Downtrends in the real estate market in various areas of the
country as evidenced by high vacancy rates in the commercial
sector, and a large unsold inventory of new homes, particularly
in California.
2. Economic recession, as evidenced by higher unemployment, slow
consumer spending, and low increases in gross national product
figures.
3. The effect of current or proposed tax reform legislation which
has slowed the level of sale and development of real estate and
the formation of real estate partnerships, in many areas of the
country.
4. Availability and cost of financing to allow for the purchase and
sale of properties and to maintain overall real estate values.
Although these factors have not materially affected the current financial
results of the Partnership, there is a potential for them to have material
effects on the Partnership's operations over the long-term.
The Partnership is subject to competitive conditions that exist in the local
markets where it operates rental real estate. These conditions are discussed in
ITEM 2-- "PROPERTIES".
The Partnership is operated by the General Partner, subject to the terms of
the Amended and Restated Agreement of Limited Partnership. The Partnership has
no employees, and all administrative services are provided by West Coast Realty
Advisors Inc.(" WCRA") the co-General Partner.
On February 26, 1988, the Partnership attained its minimum funding
requirement with the initial release of escrow funds totaling $1,272,000 and
terminated its offering on September 5, 1989. As of December 31, 1989, gross
proceeds from sales of Partnership units totaled $5,106,000 and $4,594,101 net
of syndication costs and sales commissions.
<PAGE>
ITEM 2. PROPERTIES
The properties acquired by the Partnership are described below:
YORBA CENTER
On October 25, 1988, the Partnership purchased Yorba Center, a retail
shopping center located in Chino, California.
The Center, constructed in 1987, provides 12,697 rentable square feet located
on a .91-acre parcel of land. As of December 31, 1995, the Center was 90%
leased to eight tenants. The average monthly rent per occupied square foot
was $1.20. All but two tenants are renting space on a "triple net" lease basis,
i.e., each tenant being proportionately responsible for payment of all expenses
including insurance, taxes, maintenance, and other operating expenses. The
remaining two tenants are renting space on a "gross" basis, i.e. the landlord is
responsible for payment of all expenses pertaining to these tenants.
The building and improvements are depreciated over 31.5 to 40 years using a
straight-line method for both financial and income tax reporting purposes. The
financial and income tax basis for the property are the same. In the opinion of
the General Partner, the property is adequately insured. The property is
managed by West Coast Realty Management, Inc. ("WCRM"), an affiliate of the
corporate General Partner.
The Center is dependent upon the vitality of the consumer market in the
general area. Since the City of Chino applies strict building regulations on
developers, it is expected that new development will be limited, thereby
preserving the Center's competitive edge during the Partnership's intended
holding period. Although all areas of Southern California have been affected by
the economic slowdown, layoffs, plant closings and military cutbacks, these
economic factors are not expected to significantly impact the occupancy of the
shopping center.
Tenants occupying 10% or more of rental square footage as of December 31, 1995:
Mels Liquor: 15.79% of rental square footage; $45,324 rent per year; lease
expires on May 31, 2002; Renewal Options: Lessee has option to extend lease 5
years to May 31, 2007.
Video Club: 13.69% of rental square footage; $17,232 rent per year; lease
expires on August 31, 1998; Renewal Options: No renewal options.
San Bernardino County Superintendent Schools: 17.11% of rental square footage;
$28,188 rent per year; lease expires on June 30, 1996; Renewal Options: Lessee
has 2 options to extend the lease for one additional year.
<PAGE>
SAN MARCOS INDUSTRIAL BUILDING
On January 9, 1990, the Partnership together with Associated Planners Growth
Fund (a 90%/10% interest, respectively) purchased the San Marcos Industrial
Building located in San Marcos, California.
The industrial building, constructed in 1986, consists of 40,720 rentable
square feet including 6,000 square feet of office area plus 1,300 square feet of
mezzanine above the office area and is located on a 2.66 acre parcel of land.
The building was 100% occupied by Professional Care Products, Inc. through
January 8th, 1995, on a triple net lease. This lease required the tenant to pay
insurance, taxes, maintenance, and all other operating costs.
On February 13, 1995, a new lease was executed with No Fear, Inc., which runs
through June 30, 1998. This is also a triple net lease.
The building and improvements are depreciated over 31.5 to 40 years using a
straight-line method for both financial and income tax reporting purposes. The
financial and income tax basis for the property are the same. In the opinion of
the General Partner, the property is adequately insured. The property is
managed by WCRM.
The building is located in North San Diego County, in an area of increasing
population and desirability for San Diego area professional and skilled workers
and significant employers. It is expected the building will benefit from
projected growth of the North San Diego County area.
Tenants occupying 10% or more of rental square footage as of December 31, 1995:
No Fear Inc.: 100% of rental square footage; $219,888 rent per year; lease
expires on June 30, 1998; Renewal Options: Extend lease for 60 additional months
at lessee's option.
<PAGE>
SUMMARY
As of December 31, 1995, the combined occupancy rate for all of the
Partnership's properties was 97.6%. The properties were nearly fully leased and
are generating a level of cash flow consistent with the market conditions in
which the properties operate.
The total acquisition cost to the Partnership of each property and the date
of acquisition are as follows:
ACQUISITION ACQUISITION
DESCRIPTION COST DATE
YORBA CENTER $1,851,147 10/25/88
SAN MARCOS INDUSTRIAL BUILDING $2,806,905 01/09/90
The schedule below indicates the average occupancy rate expressed as a
percentage of square feet for the last five years:
YEAR YORBA CENTER SAN MARCOS INDUSTRIAL
BUILDING
1995 90 % 88%
1994 90% 100%
1993 61% 100%
1992 61% 100%
1991 61% 100%
<PAGE>
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
<PAGE>
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS
At December 31, 1995, there were 5,096 limited partnership units outstanding
and 424 unit holders of record. The units sold are not freely transferable and
no public market for the sold units presently exists or is likely to develop.
Distributions totaling $189,361, $222,950 and $242,060 were made in 1995,
1994, and 1993, to unit holders of record at the end of the calendar quarters
indicated below. These distributions constituted a return of capital of
$49,683, $425, and $49,745 in 1995, 1994, and 1993, respectively. In addition,
$63,700 ($12.50/partnership unit) in distributions were paid to unit holders
subsequent to year-end in February 1996. The distribution amounts for 1995 and
1994 are summarized below:
RECORD DATE PER UNITS TOTAL
DATE PAID UNIT OUTSTANDING PAID
12/31/93 02/09/94 12.50 5,096 63,700
03/31/94 05/05/94 12.50 5,096 63,700
06/30/94 08/02/94 12.50 5,096 63,700
09/30/94 11/03/94 6.25 5,096 31,850
12/31/94 02/03/95 6.25 5,096 31,850
3/31/95 05/05/95 8.4088 5,096 42,851
6/30/95 08/04/95 10.00 5,096 50,960
9/30/95 11/06/95 12.50 5,096 63,700
Distributions are made out of the income from operations, before depreciation
and amortization, available as a result of the previous quarter's operations.
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA
The selected financial data should be read in conjunction with the financial
statements and related notes and ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS appearing elsewhere in this
report. This selected financial data is not covered by the accountants' opinion
included elsewhere in this report.
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C>
Operations for the years ended
December 31:
Revenues 378,489 474,562 $433,422 $434,662 $420,636
Net Income 139,678 222,525 192,315 190,361 181,418
Net Income per Limited Partner Unit * 22.94 37.57 32.23 31.83 30.26
Distributions per Limited Partner Unit 37.16 43.75 47.50 40.00 49.00
*
Financial position at December 31:
Total Assets 4,381,018 4,435,929 4,468,918 4,510,665 4,550,035
Partners' Equity 4,331,232 4,380,915 4,381,340 4,431,085 4,444,564
</TABLE>
[FN]
*Net income and distributions per limited partner unit were based on the
weighted average number of outstanding units.
ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
The Partnership began offering for sale limited partnership units on October
1987. On February 26, 1988, the Partnership reached its minimum offer level of
$1,200,000. The Partnership sold units throughout the remainder of the year,
and had raised $3,891,000 in gross proceeds or $3,483,788 net of syndication
costs and sales commissions as of December 31, 1988. During 1989, the
Partnership continued to raise funds through the sale of Units and had raised
$5,106,000 in gross proceeds or $4,594,101 net of syndication costs and sales
commissions as of September 5, 1989, the day the Partnership terminated its
offering of limited partnership units.
<PAGE>
ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS (CONT.)
During the year ended December 31, 1995, the Partnership made distributions
to the limited partners totaling $189,361, $49,683 of which constituted a return
of capital. On February 6, 1996, the Partnership made distributions of $12.50
to unit holders of record at December 31, 1995. Distributions are determined by
management based on cash flow and the liquidity position of the Partnership and
anticipated occupancy of the properties. It is the intention of management to
make quarterly distributions of cash, subject to maintenance of reasonable
reserves.
Management uses cash as its primary measure of a partnership's liquidity.
The amount of cash that represents adequate liquidity for a real estate limited
partnership depends on several factors. Among them are:
1. Relative risk of the partnership;
2. Condition of the partnership's properties;
3. Stage in the partnership's life cycle (e.g., money -raising,
acquisition, operating or disposition phase); and
4. Distributions to partners.
The Partnership has adequate liquidity based upon the above four points. The
first point refers to the approximately 1% property reserve requirement of
capital funds raised that the Partnership currently has; this relatively low
reserve level is appropriate since all Partnership properties are acquired
without the use of debt financing. This is a minimum guideline that is
disclosed in the Partnership's prospectus; the Partnership had more than enough
funds to meet this requirement as of December 31, 1995. Related to the property
reserve requirement is the second point, the condition of the Partnership's
properties. Since the properties are in good condition, no unusual maintenance
and repair expenditures are anticipated. The third point is relevant to the
Partnership because after the January 1990 purchase of the San Marcos property,
the Partnership had completed its acquisition phase, and entered the operating
phase. The fourth point relates to partner distributions. The Partnership
makes distributions from operations quarterly. Such distributions are subject
to payment of Partnership expenses and reasonable reserves for expenses,
maintenance, and replacements.
<PAGE>
ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS (CONT.)
During the year ended December 31, 1995 the Partnership paid the General
Partner a partnership management fee of $21,092 and distributed $189,361 to the
limited partners of which $49,683 constituted a return of capital. In February
1996, the Partnership paid the General Partner a partnership management fee of
$7,078 and distributed $63,700 to the limited partners. Partnership management
fees were calculated and paid in accordance with the Partnership Agreement.
The Tax Reform Acts of 1986 and 1987 and the Revenue Reconciliation Acts of
1990 and 1993 did not have a material impact on the Partnership's operations.
The effects of the slowdown in the economy, inflation and changing prices
have not had a material impact on the Partnership's revenues and income from
operations. During the years of the Partnership's existence, inflationary
pressures in the U.S. economy have been minimal, and this has been consistent
with the experience of the Partnership in operating rental real estate in
California. The Partnership has several clauses in the leases with its
properties' tenants that would help alleviate much of the negative impact of
inflation.
NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed of"
(SFAS No. 121) issued by the Financial Accounting Standards Board (FASB) is
effective for financial statements for fiscal years beginning after December 15,
1995. The new standard establishes new guidelines regarding when impairment
losses on long-lived assets, which include plant and equipment, and certain
identifiable intangible assets, should be recognized and how impairment losses
should be measured. The Partnership has elected the early adoption of SFAS No.
121. This change had no effect on the statement of income for the year ended
December 31, 1995.
<PAGE>
ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS (CONT.)
RESULTS OF OPERATIONS - 1995 VS. 1994
Operations for the years ended December 31, 1995 and 1994 reflect full years
of rental activities for the Partnership's properties. However, the San Marcos
property was not leased from January 8 to February 12, 1995. This was due to
vacancy at the property between the time that the Professional Care Products
lease terminated and the No Fear lease began. In addition to the vacancy at
the property, the lease rate that No Fear entered into was approximately 30%
less than the rate that Professional Care Products was paying during its
tenancy. Although the occupancy rate at the Yorba center Shopping Center
remained relatively steady at 90% as of December 31, 1995 (as compared to 90% at
December 31, 1994), the drop in rental rates at the San Marcos property was
responsible for a 22% ($100,080) decrease in rental revenue for 1995, as
compared to 1994. The drop in rental rates was due primarily to a decrease in
demand for commercial space in the general area.
Primarily due to the partial vacancy at the San Marcos property, operating
expenses increased 9% ($6,646) as the result of less costs that the Partnership
was able to pass on to tenants. However, the Partnership also experienced a
22% decrease in general and administrative costs ($17,481) due to lower
insurance costs and lower partnership management fees (due to a decrease in
distributions to investors). The Partnership also experienced a 41% ($4,007)
increase in interest income due to larger cash reserve balances maintained
during 1995 as compared to 1994.
Overall, the Partnership generated $239,359 in income from operations before
depreciation expense of $98,076 and loss on government securities of $1,605.
This compares unfavorably to 1994 when income from operations totaled $324,597
before depreciation of $97,933 and loss on government securities of $4,139. Net
income per limited partnership unit fell from $37.57 in 1994 to $22.94 in 1995.
The number of limited partnership units outstanding in each year was 5,096.
<PAGE>
ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS (CONT.)
In 1994, the Partnership purposely started reducing the amount of
distributions to investors in anticipation of lower rental revenues from the San
Marcos property. Up until January 1995, it was not clear to the General Partner
as to what rent, if any, could be realized on an ongoing basis from the San
Marcos Property. Distributions to limited partners fell from a high of $47.50
per unit in 1993, to $43.75 in 1994, to $37.16 in 1995. With the placement of a
tenant in the San Marcos Building (No Fear, Inc.) and the build-up of a track
record of rent collections from the tenant, the general partner now feels it
would be prudent to make cash distributions to limited partners so that a large
portion of the large cash balance is gradually paid out (contingent upon the
maintenance of reasonable reserve levels). Therefore, distributions are
expected to total between $40.00 and $45.00 per unit for 1996.
During the year, $375,284 in cash was provided by operating activities.
This resulted from a net cash basis income of $237,754 from operations (net
income plus depreciation expense) plus $163,272 in gross proceeds received in
connection with the sale of government securities and $5,991 resulting from a
decrease in accounts receivable (primarily from the collection of rents
receivable). These amounts were offset by a $26,505 increase in other assets
(primarily due to a prepaid leasing fee paid in connection with the re-leasing
of the San Marcos property), and a $4,408 decrease in security deposits
(primarily due to a decrease in the amount of security deposit required from the
new tenant at San Marcos). Cash used in investing activities totaled $9,999 in
connection with tenant improvements on the San Marcos property. Cash used in
financing activities totaled $189,361 due to the distribution to the limited
partners during the year.
The area in which the Yorba Center operates continues to experience a
relatively high level of economic vitality, and the General Partner does not
foresee significant challenges in keeping the center occupied by various small
retailers and service businesses.
The Partnership anticipates continuing to operate properties during 1996 for the
purpose of generating the maximum amount of cash available for distribution to
the limited partners, while maintaining a reasonable level of cash reserves.
There are currently no plans to dispose of either of the two properties.
<PAGE>
ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS (CONT.)
RESULTS OF OPERATIONS - 1994 VS. 1993
Operations for the years ended December 31, 1994 and 1993 reflect full years
of rental activities for the Partnership's properties. The occupancy of the
Yorba Center improved in 1994 as compared to 1993, as the occupancy was 90% in
1994 as compared to 61% at the end of 1993. This accounted for the 8.6%
($36,678) increase in property revenues in 1994, as compared to 1993.
The Partnership generated $324,597 in income from operations before
depreciation expense of $97,933 and $4,139 in unrealized loss on government
securities for 1994 compared to $290,297 in income from operations for 1993
before depreciation of $97,982. Interest income increased $4,462 (86%) as the
result of higher interest rates and higher investable cash balances. An
unrealized loss of $4,139 was recognized in 1994 in connection with the
Partnership's $163,272 investment in a pool of short-term government securities.
Operating and General and Administrative costs increased from 1993 to 1994 by
$6,840 (4.8%) primarily due to increased repairs and maintenance and management
fee expenditures.
The statement of cash flows reflects proceeds from the sales (purchases) of
government securities for 1994 and 1993. These amounts pertain to gross sales
and (purchases) of government securities and are not being reflected as net
sales or (purchases) for the periods being reported.
5,096 limited partnership units were outstanding in 1994. The net income per
limited partnership unit was $37.57 in 1994 vs.. $32.23 in 1993. Total
distributions dropped from $242,060 in 1993 to $222,950 in 1994. Much of this
decrease was the result of management's decision to hold back distribution of
some earnings in anticipation of a vacancy at the San Marcos building beginning
in January 1995. (The space was subsequently re-leased in February 1995).
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
PAGE
Report of Independent Certified Public Accountants.................. 15
Balance Sheets -- December 31, 1995 and 1994 ..................... 16
Statements of Income for the years ended
December 31, 1995, 1994, and 1993 ............................... 17
Statements of Partners' Equity for the years ended
December 31, 1995, 1994, and 1993 ............................... 18
Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993 ............................... 19
Summary of Accounting Policies ................................. 20-21
Notes to Financial Statements .................................... 22-27
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Associated Planners Realty Income Fund
(a California limited partnership)
Los Angeles, California
We have audited the accompanying balance sheets of Associated Planners Realty
Income Fund (a California limited partnership) as of December 31, 1995 and 1994
and the related statements of income, partners' equity, and cash flows for each
of the three years in the period ended December 31, 1995. We have also audited
the schedule listed in the accompanying index. These financial statements and
schedule are the responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial statements and
schedule 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 and schedule are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements and
schedule. 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 Associated Planners Realty
Income Fund (a California limited partnership), at December 31, 1995 and 1994,
and the results of its operations and its cash flows for each of the three years
in the period ended December 31, 1995 in conformity with generally accepted
accounting principles.
Also, in our opinion, the schedule presents fairly, in all material respects,
the information set forth therein.
As discussed in the summary of accounting policies, the Partnership changed its
method in accounting for investments in 1994 to conform with SFAS No. 115.
BDO SEIDMAN, LLP
Los Angeles, California
February 12, 1996
<PAGE>
<TABLE>
ASSOCIATED PLANNERS REALTY INCOME FUND
BALANCE SHEETS
<CAPTION>
December 31, 1995 1994
<S> <C> <C>
ASSETS
Rental real estate, less accumulated
depreciation (Note 2) $ 4,072,847 $ 4,160,924
Cash and cash equivalents 261,728 85,804
Investment in government securities,
at market value - 163,272
Accounts receivable
Trade - 3,818
Related party (Note 4) - 2,173
Other assets 46,443 19,938
Total assets $ 4,381,018 $ 4,435,929
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES
Accounts payable:
Trade $ 1,016 $ 24,110
Related party (Note 4) 22,480 206
Security deposits 26,290 30,698
Total liabilities 49,786 55,014
PARTNERS' EQUITY (Note 5)
Limited partners:
$1,000 stated value per unit - authorized
12,000 units; issued and outstanding 5,096 4,124,520 4,196,996
General partners 206,712 183,919
Total partners' equity 4,331,232 4,380,915
Total liabilities and partners' equity $ 4,381,018 $ 4,435,929
</TABLE>
[FN]
SEE ACCOMPANYING SUMMARY OF ACCOUNTING POLICIES AND NOTES TO FINANCIAL
STATEMENTS
<PAGE>
<TABLE>
ASSOCIATED PLANNERS REALTY INCOME FUND
STATEMENTS OF INCOME
<CAPTION>
Years ended December 31, 1995 1994 1993
<S> <C> <C> <C>
REVENUES
Rental (Notes 2 and 3) $ 364,823 $ 464,903 $ 428,225
Interest 13,666 9,659 5,197
378,489 474,562 433,422
COSTS AND EXPENSES
Operating 77,744 71,098 57,963
General and administrative 61,386 78,867 85,162
Depreciation and amortization 98,076 97,933 97,982
Loss on government securities 1,605 4,139 -
238,811 252,037 241,107
NET INCOME $139,678 $ 222,525 $ 192,315
NET INCOME PER LIMITED PARTNERSHIP UNIT (Note 5) $22.94 $37.57 $32.23
</TABLE>
[FN]
SEE ACCOMPANYING SUMMARY OF ACCOUNTING POLICIES AND NOTES TO FINANCIAL
STATEMENTS
<PAGE>
<TABLE>
ASSOCIATED PLANNERS REALTY INCOME FUND
STATEMENTS PARTNERS EQUITY
<CAPTION>
Limited Partners General
Total Units Amount Partner
<S> <C> <C> <C> <C>
BALANCE, January 1, 1993 $ 4,431,085 5,096 $ 4,306,282 $ 124,803
Net income for the year 192,315 - 164,265 28,050
Distributions to limited
partners (242,060) - (242,060) -
BALANCE, December 31, 1993 4,381,340 5,096 4,228,487 152,853
Net income for the year 222,525 - 191,459 31,066
Distributions to limited
partners (222,950) - (222,950) -
BALANCE, December 31, 1994 4,380,915 5,096 4,196,996 183,919
Net income for the year 139,678 - 116,885 22,793
Distributions to limited
partners (189,361) - (189,361) -
BALANCE, December 31, 1995 $ 4,331,232 5,096 $ 4,124,520 $ 206,712
</TABLE>
[FN]
See accompanying summary of accounting policies and notes to financial
statements.
<PAGE>
<TABLE>
ASSOCIATED PLANNERS REALTY INCOME FUND
STATEMENTS OF CASH FLOWS
<CAPTION>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
Years ended December 31, 1995 1994 1993
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 139,678 $ 222,525 $ 192,315
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 98,076 97,933 97,982
Increase (decrease) from changes in:
Government securities 163,272 7,246 (170,518)
Accounts receivable 5,991 (1,082) (119)
Other assets (26,505) 5,621 145
Accounts payable (820) (31,938) 8,597
Security deposits (4,408) (693) (712)
Net cash provided by operating activities 375,284 299,612 127,690
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to rental real estate (9,999) (31,136) -
Net cash provided by (used in) investing activities (9,999) (31,136) -
CASH FLOWS FROM FINANCING ACTIVITIES
Distributions to limited partners (189,361) (222,950) (242,060)
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 175,924 45,526 (114,370)
CASH AND CASH EQUIVALENTS,
beginning of year 85,804 40,278 154,648
CASH AND CASH EQUIVALENTS,
end of year $ 261,728 $ 85,804 $ 40,278
</TABLE>
[FN]
See accompanying summary of accounting policies and notes to financial
statements.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
SUMMARY OF ACCOUNTING POLICIES
BUSINESS Associated Planners Realty Income Fund ("the
Partnership"), a California limited partnership, was
formed on December 23, 1986 under the Revised Limited
Partnership Act of the State of California for the
purpose of developing or acquiring, managing and
operating unleveraged income producing real estate. The
Partnership met its minimum funding of $1,200,000 on
February 26, 1988 and terminated its offering on
September 5, 1989. The Partnership was formed to acquire
income-producing real property throughout the United
States with emphasis on properties located in California
and southwestern states. The Partnership purchases such
properties on an all cash basis and intends to own and
operate such properties for investment over an
anticipated holding period of approximately five to ten
years.
BASIS OF The financial statements do not give effect to any assets
PRESENTATION that the partners may have outside of their interest in
the partnership, nor to any personal obligations,
including income taxes, of the partners.
RENTAL REAL Assets are stated at cost. Depreciation is computed
ESTATE AND using the straight-line method over estimated useful
DEPRECIATION lives ranging from 31.5 to 40 years for financial and
income tax reporting purposes.
In the event that facts and circumstances indicate that
the cost of an asset may be impaired, an evaluation of
recoverability would be performed. If an evaluation is
required, the estimated future undiscounted cash flows
associated with the asset would be compared to the
carrying amount to determine if a write-down to market
value is required.
LEASE Lease commissions which are paid to real estate brokers
COMMISSIONS for locating tenants are capitalized and amortized over
the life of the lease.
RENTAL Rental revenue is recognized when the amount is due and
REVENUE payable under the terms of a lease agreement.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
SUMMARY OF ACCOUNTING POLICIES
INVESTMENTS During 1994, the Partnership changed its method of
accounting for Investments. Investments which represent
trading securities, are accounted for in accordance with
SFAS No. 115. The difference between historical cost and
market value are reported as unrealized gains or losses
in the statement of income. The effect of this change in
accounting policy is not material to the financial
statements.
STATEMENTS OF For purposes of the statements of cash flows, the
CASH FLOWS Partnership considers cash in the bank and all highly
liquid investments purchased with original maturities of
three months or less, to be cash and cash equivalents.
USE OF ESTIMATES The preparation of financial statements in conformity
with generally accepted accounting principles requires
management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts
of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
RECLASSIFICATIONS For comparative purposes, certain prior year amounts have
been reclassified to conform to the current year
presentation.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
NOTES TO FINANCIAL STATEMENTS
1. NATURE OF The Partnership began accepting subscriptions in October
PARTNERSHIP 1987 and closed the offering on September 5, 1989. The
Partnership began operations in March 1988.
Under the terms of the partnership agreement, the General
Partners (West Coast Realty Advisors, Inc., and W. Thomas
Maudlin, Jr.) are entitled to cash distributions from 10%
to 15%. The General Partners are also entitled to net
income (loss) allocations varying from 1% to 15% and 1%
of depreciation and amortization in accordance with the
partnership agreement. Further, the General Partners
receive acquisition fees for locating and negotiating the
purchase of rental real estate, management fees for
operating the Partnership and a commission on the sale of
the partnership properties.
2. RENTAL REAL The Partnership owns the following two rental real estate
ESTATE properties, one is wholly-owned and the second, a 90%
undivided interest:
Location Acquisition
(Property Name) Date Purchased Cost
Chino, California
(Yorba Center) October 25, 1988 $1,851,147
San Marcos,
California January 9, 1990 2,806,905
The major categories of rental real estate are:
December 31, 1995 1994
Land $1,282,861 $1,282,861
Buildings and
improvements 3,416,326 3,406,327
4,699,187 4,689,188
Less accumulated
depreciation 626,340 528,264
Rental real estate, net $4,072,847 $4,160,924
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
NOTES TO FINANCIAL STATEMENTS
2. RENTAL REAL A significant portion of the Partnership's rental revenue
ESTATE was earned from tenants whose individual rents
(CONTINUED) represented more than 10% of total rental revenue.
Specifically:
Two tenants accounted for 12% and 52% in 1995;
Two tenants accounted for 10% and 62% in 1994;
Two tenants accounted for 10% and 72% in 1993.
3. FUTURE As of December 31, 1995, future minimum rental income
MINIMUM under existing leases, excluding month to month rental
RENTAL INCOME agreements, that have remaining noncancelable terms in
excess of one year are as follows:
Years ending
December 31, Amount
1996 $353,234
1997 329,136
1998 163,333
1999 37,903
2000 36,825
Total $920,431
Future minimum rental income does not include lease
renewals or new leases that may result after a noncan-
celable-lease expires.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
NOTES TO FINANCIAL STATEMENTS
4. RELATED PARTY (a) In accordance with the partnership agreement,
TRANSACTIONS compensation earned by or services reimbursed to the
corporate General Partner consisted of the following:
Years ended December 31, 1995 1994 1993
Partnership management fees $21,092 $24,773 $26,896
Administrative services:
Data processing 4,709 4,877 4,770
Postage 2,582 2,247 2,460
Investor processing 1,884 1,951 1,908
Duplication 942 975 954
Investor communications 1,413 1,463 1,431
Miscellaneous 471 487 477
$33,093 $36,773 $38,896
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
NOTES TO FINANCIAL STATEMENTS
(b) The Partnership owns a 90% undivided interest in
property located in San Marcos, California. The
remaining 10% interest is owned by Associated Planners
Realty Growth Fund, an affiliate.
(c) Property management fees incurred in accordance with
the partner ship agreement with West Coast Realty
Management, Inc., an affiliate of the corporate General
Partner, totaled $17,568, $24,760 and $22,886 for 1995,
1994 and 1993. Related party accounts payable to West
Coast Realty Management, Inc. at December 31, 1995 and
1994 were $4,973 and $206. Related party accounts
payable to West Coast Realty Advisors, Inc. at December
31, 1995 was $6,000. Related party accounts payable to
Associated Financial Group, Inc. at December 31, 1995 was
$11,507.
(d) Related party accounts receivable from Associated
Planners Realty Growth Fund, at December 31, 1994 was
$2,173.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
NOTES TO FINANCIAL STATEMENTS
5. NET INCOME The Net Income per Limited Partnership Unit was computed
AND CASH in accordance with the partnership agreement on the basis
DISTRIBUTIONS of the weighted average number of outstanding Limited
PER LIMITED Partnership Units of 5,096 for 1995, 1994 and 1993.
PARTNERSHIP
UNIT The Limited Partner cash distributions, computed in
accordance with the Partnership Agreement, were as
follows:
Outstanding Amount Total
Record Date Units Per Unit Distribution
September 30, 1995 5,096 $ 12.5000 $ 63,700
June 30, 1995 5,096 10.0000 50,960
March 31, 1995 5,096 8.4088 42,851
December 31, 1994 5,096 6.2500 31,850
Total $189,361
September 30, 1994 5,096 $ 6.2500 $ 31,850
June 30, 1994 5,096 12.5000 63,700
March 31, 1994 5,096 12.5000 63,700
December 31, 1993 5,096 12.5000 63,700
Total $222,950
September 30, 1993 5,096 $ 12.5000 $ 63,700
June 30, 1993 5,096 12.5000 63,700
March 31, 1993 5,096 12.5000 63,700
December 31, 1992 5,096 10.0000 50,960
Total $242,060
Distributions are paid in the fiscal quarter following
the record date.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
NOTES TO FINANCIAL STATEMENTS
6. NEW Statement of Financial Accounting Standards No. 121,
ACCOUNTING "Accounting for the Impairment of Long-Lived Assets and
PRONOUNCE- for Long-Lived Assets to Be Disposed of" (SFAS No. 121)
MENTS issued by the Financial Accounting Standards Board (FASB)
is effective for financial statements for fiscal years
beginning after December 15, 1995. The new standard
establishes new guidelines regarding when impairment
losses on long-lived assets, which include plant and
equipment, and certain identifiable intangible assets,
should be recognized and how impairment losses should be
measured. The Partnership has elected the early adoption
of SFAS No. 121. This change had no effect on the
statement of income for the year ended December 31, 1995.
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Partnership is managed by the General Partners and the Limited Partners
have no right to participate in the management of the Partnership or its
business.
Resumes of the General Partners' principal officers and directors and a
description of the General Partners are set forth in the following paragraphs.
See description below.
WEST COAST REALTY ADVISORS, INC.
West Coast Realty Advisors, Inc. ("WCRA") is a California corporation
formed on May 10, 1983 for the purpose of structuring real estate programs and
to act as general partner of such programs. It is a subsidiary of Associated
Financial Group, Inc.
PHILIP N. GAINSBOROUGH (Born 1938) is Chairman and a Director of West Coast
Realty Advisors, Inc. He is also currently the President of Associated
Financial Group, Inc., Associated Securities Corp., Associated Planners
Insurance Services, Inc., and Associated Planners Investment Advisory, Inc. In
addition, from January 1981 to the present, he has served as President of
Gainsborough Financial Consultants, Inc., a financial planning firm located in
Los Angeles, California. From January 1981 to December 1982, Mr. Gainsborough
served as a Registered Principal of Private Ledger Financial Services, Inc.
From January 1977 to December 1980, he was employed by E.F.Hutton & Co. as a
Registered Representative.
W. THOMAS MAUDLIN JR. (Born 1936) is a Director and President of West Coast
Realty Advisors, Inc. ("WCRA"). He is also co-General Partner (with WCRA) of
the Partnership. Mr. Maudlin has been active in the real estate area for over
30 years, serving as co-developer of high-rise office buildings and
condominiums. He has structured transactions for syndicators in apartment
housing, including sale leasebacks, all-inclusive trust deeds, buying and
restructuring transactions to suit a particular buyer, and as a buyer acting as
a principal. Mr. Maudlin was co-developer of the Gateway Los Angeles office
building, a 165,000 square foot, fourteen-story office building located in West
Los Angeles. Form 1980 to 1985, in partnership with the Muller Company, he
developed eleven acres in San Bernardino which included a 42,000 square-foot
office building, a six-plex movie theater and two restaurants. From 1980 to
1985, Mr. Maudlin was involved in building in San Bernardino, California, a 134-
unit condominium development, a shopping center, and a restaurant in Ventura.
He is a graduate of the University of Southern California.
<PAGE>
WILLIAM T. HAAS (Born 1946 ) is a Director and Executive Vice
President/Secretary of West Coast Realty Advisors, Inc., Associated Planners
Insurance Services, Associated Securities Corp., and Associated Planners
Investment Advisory, Inc. He is also Executive Vice President/Secretary and a
Director of Associated Financial Group, Inc. He has been affiliated with
various Associated companies since 1982. From December 1977 to December 1982,
Mr. Haas was employed by the National Association of Securities Dealers, Inc. in
various capacities, including that of Supervisor of Examiners. From 1968 to
1977, he was associated with Merrill Lynch as a branch office operations
manager, and in the home office Operations Liaison department.
MICHAEL G. CLARK (Born 1956) is Senior Vice President/Treasurer of West
Coast Realty Advisors, Inc., Associated Financial Group, Inc., and Associated
Securities Corp. Prior to joining AFG in 1986, he served as Controller for
Quest Resources, a Los Angeles-based syndicator and operator of alternative
energy projects, from October 1984 to March 1986, and Assistant Controller for
Valley Cable T.V., from March 1982 through September 1984. In addition, Mr.
Clark served as an auditor for Arthur Young & Co. in Los Angeles, from July 1978
to March 1982. He is a graduate of the University of California, Santa Barbara
(BA) and California State University, Northridge (MS).
ITEM 11. EXECUTIVE COMPENSATION
During its last calendar year, the Registrant paid no direct or indirect
compensation to directors or officers.
The Registrant has no annuity, pension or retirement plans, or existing
plan or arrangement pursuant to which compensatory payments are proposed to be
made in the future to directors or officers.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The Registrant is a limited partnership and has no officers or directors.
The Registrant has no outstanding securities possessing general voting rights.
<PAGE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Registrant was organized in December 1986 as a California Limited
Partnership. Its General Partners (collectively referred to herein as the
"General Partner") are West Coast Realty Advisors, Inc. and W. Thomas Maudlin
Jr., an individual. The Registrant has no executive officers or directors.
Philip N. Gainsborough, an officer of the General Partner, made an original
limited partnership contribution to the Partnership in March 1987, which was
subsequently paid back to him in March 1988 when the Partnership met its minimum
funding requirement. The General Partner and its affiliates are entitled to
compensation from the Partnership for the following services:
1. For Partnership management services rendered to the Partnership, the
General Partner is entitled to receive up to 10% of all distributions of cash
from operations. For the year ended December 31, 1995, the amount paid the
General Partner was $21,092. In addition, the General Partner is entitled to
reimbursement for certain public offering expenses, the cost of certain
personnel employed in the organization of the Partnership, and certain
administrative services performed by the General Partner. For the year ended
December 31, 1995, the Partnership reimbursed $12,000 to the General Partner for
these expenditures.
2. For property management services, the General Partner engaged West
Coast Realty Management, Inc. ("WCRM") an affiliate of the General Partner. For
the year ended December 31, 1995, the Partnership incurred property management
fees of $17,568 with WCRM.
3. The General Partner received a 10% allocation of net income before
depreciation and amortization and 1% of depreciation and amortization. For the
year ended December 31, 1995 this resulted in a $23,774 allocation of net income
before depreciation and amortization and a $981 allocation of depreciation and
amortization, or a net income allocation of $22,793.
4. On December 31, 1995 the Partnership was indebted to WCRM for $4,973,
which was paid subsequent to year-end.
<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) 1. FINANCIAL STATEMENTS
The following financial statements of Associated Planners Realty
Income Fund, a California Limited Partnership, are included in PART
II, ITEM 8:
PAGE
Report of Independent Certified Public Accountants................. 15
Balance Sheets -- December 31, 1995 and 1994 ...................... 16
Statements of Income for the years ended
December 31, 1995, 1994, and 1993 ......................... 17
Statements of Partners' Equity for the years ended
December 31, 1995, 1994, and 1993 ......................... 18
Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993 ......................... 19
Summary of Accounting Policies ................................ 20-21
Notes to Financial Statements ................................... 22-27
2. FINANCIAL STATEMENT SCHEDULES
Schedule III --Real Estate and Accumulated Depreciation ...... 33
All other schedules have been omitted because they are either not required,
not applicable or the information has been otherwise supplied.
(b) REPORTS ON FORM 8-K
NONE
(c) EXHIBITS
NONE
<PAGE>
<TABLE>
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
Information required by Rule 12-28 is as follows:
<CAPTION>
--Initial Cost-- Cost Gross Amount at Which Life (Years)
Capitalized Carried at Close of Period on which
Building Subsequent Building Depreciation
& Acquisition & Year Computed
Improve- Improvements Improve- Total Accumulated Construct- Date Building
Description Land ments Land ments Cost Deprecia Completed Acquir Improve
tion ed ments
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Yorba Center
Chino, 555,344 1,295,803 31,136 555,344 1,326,939 1,882,283 269,625 1987 10-88 31.5-40
California
San Marcos
Industrial
Building
San Marcos,
California 727,517 2,079,388 9,999 727,517 2,089,387 2,816,904 356,715 1986 1-90 31.5-40
TOTAL 1,282,861 3,375,191 41,135 1,282,861 3,416,326 4,699,187 626,340
</TABLE>
<TABLE>
<CAPTION>
There were no mortgage notes payable on the properties at December 31, 1995.
<S> <C> <S> <C>
A reconciliation of accumualted A reconciliation of
depreciation is as follows: the total cost is as
follows:
Balance at December 31, $333,023 Balance at December
1992................... 31, $4,658,052
...................... 1992................
....................
.....
1993 Depreciation 97,308 1993 Additions
....................... ....................
....................... ....................
................... ....................
.....
Balance at December 31, 430,331 Balance at December 4,658,052
1993................... 31,
...................... 1993................
....................
.....
1994 Depreciation 97,933 1994 Additions 31,136
....................... ....................
....................... ....................
................... ....................
.....
Balance at December 31, 528,264 Balance at December 4,689,188
1994 31, 1994
....................... ....................
................. ....................
1995 Depreciation 98,076 1995 Additions 9,999
....................... ....................
....................... ....................
................... ....................
.....
Balance at December 31, $626,340 Balance at December
1995 31, 1995 $4,699,187
....................... ....................
................. ....................
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the 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.
ASSOCIATED PLANNERS REALTY INCOME FUND
A California Limited Partnership
(Registrant)
W. THOMAS MAUDLIN JR.
(A General Partner)
By: WEST COAST REALTY ADVISORS, INC.
(A General Partner)
WILLIAM T. HAAS
(Director and Executive Vice President/Secretary)
MICHAEL G. CLARK
(Vice President/Treasurer)
April 1, 1996
[ARTICLE] 5
[CIK] 0000808420
[NAME] ASSOCIATED PLANNERS REALTY INCOME FUND
<TABLE>
<S> <C>
[PERIOD-TYPE] 12-MOS
[FISCAL-YEAR-END] DEC-31-1995
[PERIOD-START] JAN-01-1995
[PERIOD-END] DEC-31-1995
[CASH] 261,728
[SECURITIES] 0
[RECEIVABLES] 0
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 308,171
[PP&E] 4,699,187
[DEPRECIATION] (626,340)
[TOTAL-ASSETS] 4,381,018
[CURRENT-LIABILITIES] 49,786
[BONDS] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 0
[OTHER-SE] 4,331,232
[TOTAL-LIABILITY-AND-EQUITY] 4,381,018
[SALES] 364,823
[TOTAL-REVENUES] 378,489
[CGS] 238,811
[TOTAL-COSTS] 238,811
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] 139,678
[INCOME-TAX] 0
[INCOME-CONTINUING] 0
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 139,678
[EPS-PRIMARY] 22.94
[EPS-DILUTED] 22.94
</TABLE>
