FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 1997
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 33-11013
ASSOCIATED PLANNERS REALTY INCOME FUND
(Exact name of registrant as specified in its charter)
CALIFORNIA 95-4120092
(State or other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5933 W. CENTURY BLVD., SUITE 900
LOS ANGELES, CALIFORNIA 90045
(Address of principal executive offices)
(Zip Code)
(310) 670-0800
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report)
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
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
In the opinion of the General Partner of Associated Planners Realty Income Fund
(the "Partnership"), all adjustments necessary for a fair presentation of the
Partnership's results for the three months ended March 31, 1997 and 1996, have
been made in the following financial statements which are normal recurring
entries in nature. However, such financial statements are unaudited and are
subject to any year-end adjustments that may be necessary.
<TABLE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
BALANCE SHEETS
MARCH 31, 1997 (UNAUDITED) AND DECEMBER 31, 1996
<CAPTION>
March 31, 1997 December 31, 1996
<S> <C> <C>
ASSETS
Rental real estate, less accumulated
depreciation (Note 2) $4,135,029 $4,160,642
Cash and cash equivalents 72,433 72,207
Other assets 51,786 42,372
TOTAL ASSETS $4,259,248 $4,275,221
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES
Accounts payable-Related party (Note 3) $ 1,641 $ 4,578
Security deposits 28,576 28,576
TOTAL LIABILITIES 30,217 33,154
PARTNERS' EQUITY (NOTE 6)
Limited partners:
$1,000 stated value per unit - authorized
12,000 units; issued and outstanding 5,096 4,191,250 4,205,288
General partners 37,781 36,779
TOTAL PARTNERS' EQUITY 4,229,031 4,242,067
TOTAL LIABILITIES AND PARTNERS' EQUITY $4,259,248 $4,275,221
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
<TABLE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF PARTNERS' EQUITY
THREE MONTHS ENDED MARCH 31, 1997
(UNAUDITED)
<CAPTION>
LIMITED PARTNERS GENERAL
TOTAL UNITS AMOUNT PARTNER
<S> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1996 $4,242,067 5,096 $4,205,288 $36,779
Net income 43,586 -- 36,922 6,664
Distributions to limited partners (50,960) -- (50,960) --
Distributions to general partner (5,662) -- -- (5,662)
BALANCE AT MARCH 31, 1997 $4,229,031 5,096 $4,191,250 $37,781
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1996
(UNAUDITED)
LIMITED PARTNERS GENERAL
TOTAL UNITS AMOUNT PARTNER
<S> <C> <C> <C> <C>
BALANCE AT DECEMBER 31, 1995 $4,331,232 5,096 $4,124,520 $206,712
Net income 49,000 -- 41,890 7,110
Reallocation of balances prior
to January 1, 1996 (Note 6) -- -- 170,030 (170,030)
Distributions to limited partners (63,700) -- (63,700) --
Distributions to general partner (7,078) -- -- (7,078)
BALANCE AT MARCH 31, 1996 $4,309,454 5,096 $4,272,740 $36,714
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
<TABLE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF INCOME
THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(UNAUDITED)
<CAPTION>
Three Three
Months Months
Ended Ended
March 31, March 31,
1997 1996
<S> <C> <C>
REVENUES
Rental $101,757 $103,381
Interest 260 2,906
102,017 106,287
COSTS AND EXPENSES
Operating 13,778 15,511
Property taxes 5,045 3,690
Property management fees (Note 3(c ) 4,356 4,398
General and administrative 9,639 9,133
Depreciation and amortization 25,613 24,555
58,431 57,287
NET INCOME $ 43,586 $49,000
NET INCOME PER LIMITED PARTNERSHIP
UNIT (Note 4) $7.25 $8.22
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
<TABLE>
ASSOCIATED PLANNERS REALITY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (UNAUDITED)
<CAPTION>
THREE MONTHS THREE MONTHS
ENDED ENDED
MARCH 31, MARCH 31,
1997 1996
<S> <C> <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $43,586 $49,000
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 25,613 24,555
Increase (decrease) from changes in:
Other assets (9,414) (8,792)
Accounts payable (2,937) (18,098)
Security deposits and prepaid rents --- 3,426
NET CASH PROVIDED BY OPERATING ACTIVITIES 56,848 50,091
CASH FLOWS FROM FINANCING ACTIVITIES
Distributions to limited partners (50,960) (63,700)
Distributions to general partners (5,662) (7,078)
NET CASH (USED IN) FINANCING ACTIVITIES (56,622) (70,778)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 226 (20,687)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 72,207 261,728
CASH AND CASH EQUIVALENTS, END OF PERIOD $72,433 $241,041
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
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 PRESENTATION
The financial statements do not give effect to any assets 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 ESTATE AND ESTATE AND DEPRECIATION
Assets are stated at cost. Depreciation is computed using the straight-line
method over estimated useful lives ranging from 31.5 to 40 years for financial
reporting 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 vale is required.
LEASE COMMISSIONS
Lease commissions which are paid to real estate brokers for locating tenants are
capitalized and amortized over the life of the lease.
RENTAL REVENUE
Rental revenue is recognized when the amount is due and payable under the terms
of a lease agreement.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
SUMMARY OF ACCOUNTING POLICIES
(CONTINUED)
INVESTMENTS
The difference between historical cost and market value are reported as
unrealized gains or losses in the statement of income.
STATEMENTS OF CASH FLOWS
For purposes of the statements of cash flows, the 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.
NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities" (SFAS No.
125) issued by the Financial Accounting Standards Board (FASB) is effective for
transfers and servicing of financial assets and extinguishments of liabilities
occurring after December 31, 1996, and is to be applied prospectively. Earlier
or retroactive application is not permitted. The new standard provides
accounting and reporting standards for transfers and servicing of financial
assets and extinguishments of liabilities. The Partnership does not expect
adoption to have a material effect on its financial position or results of
operations.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1996
NOTE 1 - NATURE OF PARTNERSHIP BUSINESS
Associated Planners Realty Income Fund, a California limited partnership (the
"Fund"), was formed on December 23, 1986 under the Revised Limited Partnership
Act of the State of California for the purpose of acquiring, managing, and
operating income-producing real estate.
The Partnership began accepting subscriptions in October 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.
NOTE 2 - RENTAL REAL ESTATE
The Partnership owns the following two rental real estate properties:
Acquisition
Location (Property Name) Date Purchased Cost
Chino, California
(Yorba Center) October 25, 1988 $ 1,881,147
San Marcos, California (90%) January 9, 1990 2,816,904
San Marcos, California (10%) November 1, 1996 188,001
The major categories of rental real estate:
March 31, 1997 December 31, 1996
Land $1,332,861 $1,332,861
Building and improvements 3,554,327 3,554,327
4,887,188 4,887,188
Less accumulated depreciation 752,159 726,546
Net rental real estate 4,135,029 4,160,642
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996(UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
NOTE 2 - RENTAL REAL ESTATE (CONTINUED)
A significant portion of the Partnership's rental revenue was earned from
tenants whose individual rents represented more than 10% of total rental
revenue.
Specifically:
Two tenants accounted for 65% and 12% in 1997
One tenant accounted for 58% in 1996
On November 1, 1996, Associated Planners Realty Income Fund ("Income Fund")
purchased the remaining real estate asset from Associated Planners Realty Growth
Fund ("Growth Fund"). This asset consisted of the 10 % interest that Income
Fund had not already owned in an office building located in San Marcos,
California.
Income Fund paid $185,968 on November 2, 1996 for the 10% interest in the San
Marcos property. This amount consisted of $188,000 for the property itself,
less $2,032 for the share of a cash security deposit from the current tenant
that Growth Fund retained. There is no debt in connection with the property.
NOTE 3 - RELATED PARTY TRANSACTIONS
(a) For Partnership management services rendered to the Partnership, the
General Partner is entitled to receive 10% of all distributions of Cash from
Operations. These amounts totaled $5,662 for the three months ended March 31,
1997 and $7,078 for the three months ended March 31, 1996. See Note 6.
(b) For administrative services rendered to the Partnership, the General
Partner, in accordance with the partnership agreement, was reimbursed $3,000 for
the three months ended March 31, 1997 and 1996.
(c) Property management fees incurred in accordance with the Partnership
Agreement to West Coast Realty Management, Inc., an affiliate of the corporate
General Partner, totaled $4,356 for the three months March 31, 1997, and $4,398
for the three months ended March 31, 1996.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
NOTE 4 - NET INCOME AND CASH DISTRIBUTIONS PER LIMITED PARTNERSHIP UNIT
The Net Income per Limited Partnership Unit was computed in accordance with the
partnership agreement on the basis of the weighted average number of outstanding
Limited Partnership Units of 5,096 for 1997 and 1996.
The Limited Partner cash distributions, computed in accordance with the
Partnership Agreement, were as follows:
Record Date Outstanding Amount Total
Units Per Unit Distribution
September 30, 1996 5,096 $10.000 $50,960
June 30, 1996 5,096 10.000 50,904
March 31, 1996 5,096 13.000 66,248
December 31, 1995 5,096 12.500 63,700
Total $231,812
September 30, 1995 5,096 $12.500 $63,700
June 30, 1995 5,096 10.000 50,960
March 31, 1995 5,096 8.4088 42,851
December 31, 1994 5,096 6.2500 31,850
Total $189,361
Distributions were paid in the fiscal quarter following the record date.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1996
(CONTINUED)
NOTE 5 - NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities" (SFAS No.
125) issued by the Financial Accounting Standards Board (FASB) is effective for
transfers and servicing of financial assets and extinguishments of liabilities
occurring after December 31, 1996, and is to be applied prospectively. Earlier
or retroactive application is not permitted. The new standard provides
accounting and reporting standards for transfers and servicing of financial
assets and extinguishments of liabilities. The Partnership does not expect
adoption to have a material effect on its financial position or results of
operations.
NOTE 6 - REALLOCATION OF PARTNER BALANCES
Per the provisions of Section 11.1 (V)(ii) of the Partnership Agreement, the
General Partner determined that action was necessary to "cure the ambiguities"
within the Agreement. The ambiguity involved the treatment of the partnership
management fee, being paid to the General Partner, as an expense of the
Partnership, as opposed to a general partner withdrawal of capital. It was
determined that the partnership management fee shall be treated as a withdrawal
of capital in 1996 and beyond with a retroactive reallocation of capital for
partnership management fees paid prior to 1996. In order to properly reflect
this reallocation, a transfer of $170,030 was made from the General Partner's
capital account to the Limited Partners capital account during the quarter ended
March 31, 1996.
NOTE 7 - SUBSEQUENT EVENTS
The Partnership distributed $53,508 ($10.50 per unit) on May 9, 1997 to Limited
Partners as of March 31, 1997.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
INTRODUCTION
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.
The Partnership was organized for the purpose of investing in, holding, and
managing improved, leveraged income-producing property, such as residential
property, office buildings, commercial buildings, industrial properties, and
shopping centers. The Partnership intends to own and operate such properties
for investment over an anticipated holding period of approximately five to ten
years.
The Partnership's principal investment objectives are to invest in rental real
estate 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 during the early years
of property operations, 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.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
The ownership and operation of any income-producing real estate is subject to
those risks inherent in all real estate investments, including national and
local economic conditions, the supply and demand for similar types of
properties, competitive marketing conditions, zoning changes, possible casualty
losses, increases in real estate taxes, assessments, and operating expenses, as
well as others.
The Partnership is operated by West Coast Realty Advisors, Inc. ("WCRA") (the
corporate General Partner) and Mr. W. Thomas Maudlin Jr. (an individual General
Partner), collectively 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 WCRA, the corporate
General Partner.
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 offering 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.
During the quarter ended March 31, 1997, the Partnership made distributions to
the general and limited partners totaling $56,622, of which $13,036 constituted
a return of capital. The $56,622 in distributions compared favorably to the
$69,199 in cash generated from property operations (net income plus depreciation
expense). On May 9, 1997, the Partnership made distributions of $10.50 to unit
holders of record at March 31, 1997. 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:
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
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 March 31, 1997. 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 effectively completed its acquisition phase, and entered the
operating phase. The subsequent purchase of the remaining 10% interest in San
Marcos property was achieved utilizing a combination of reserves and,
undistributed operating profits that were held back for the purpose of
facilitating the acquisition. 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.
During the quarter ended March 31, 1997 the Partnership paid the General Partner
a partnership management fee of $5,662. 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.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
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.
CASH FLOWS - MARCH 31, 1997 VS. MARCH 31, 1996
Cash resources increased $226 during the three months ended March 31, 1997
compared to a $20,687 decrease in cash resources for the three months ended
March 31, 1996. Cash provided by operating activities increased by $56,848 with
the largest contributor being $69,199 in cash basis income for the three months
ended March 31, 1997. In contrast, the three months ended March 31, 1996
provided $50,091 in cash from operating activities due primarily to $73,555 in
cash basis income offset by a $18,098 decrease in accounts payable (primarily
due to a decrease in the amount of trade payables). During 1997, $56,622 was
distributed to the limited and general partners and this is noted as a large use
of cash under financing activities. This continues the Partnership's trend of
paying virtually all the cash basis income out to partners in the form of
quarterly distributions. In contrast, 1996's cash used for financing
activities was $70,778 due to distributions to the limited and general partners.
There were no investing activities during the three months ended March 31, 1997
or 1996.
NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 125, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities" (SFAS No.
125) issued by the Financial Accounting Standards Board (FASB) is effective for
transfers and servicing of financial assets and extinguishments of liabilities
occurring after December 31, 1996, and is to be applied prospectively. Earlier
or retroactive application is not permitted. The new standard provides
accounting and reporting standards for transfers and servicing of financial
assets and extinguishments of liabilities. The Partnership does not expect
adoption to have a material effect on its financial position or results of
operations.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
RESULTS OF OPERATIONS
Operations for the quarter ended March 31, 1997 represented a full quarter of
rental operations for the Partnership's two properties.
The net income for the quarter ended March 31, 1997 ($43,586) was lower than the
quarter ended March 31, 1996 ($49,000) due to lower rents collected from the
Yorba Center property, offset by increased rent, resulting from the acquisition
of the remaining 10% interest of the San Marcos property in November 1996. The
Partnership did not have any adverse events that significantly impacted net
income during the quarter ended March 31, 1997, and all properties that have
been purchased by the Partnership have operated at levels equal to current
expectations. All tenants are current on their lease obligations.
Rental revenue decreased $1,624 (2%) for the three months ended March 31, 1996
as compared to the three months ended March 31, 1997, due to lower rents
collected from the Yorba Center property, offset by the increased rent resulting
from the acquisition of the remaining 10% interest of the San Marcos property in
November 1996. Interest income decreased $2,646 (91%) for the three months
ended March 31, 1997 as compared to the three months ended March 31, 1996 due to
$188,000 is cash reserves being used to purchase the remaining 10% of the San
Marcos property in November 1996. This $188,000 was earning interest during the
first three months of 1996.
Operating expenses decreased $1,733 (11%) as a result of lower repairs and
maintenance costs during the quarter ended March 31, 1997 compared to the
quarter ended March 31, 1996. General and administrative expenses increased
$506 (6%) due to higher legal and accounting fees. Depreciation expense
increased $1,058 (4%) as a result of the ownership of the remaining 10% in the
San Marcos property.
During the quarter ended March 31, 1997, the Partnership distributed $50,960 to
the limited partners and $5,662 to the general partners, as compared to the
quarter ended March 31, 1996 when the Partnership distributed $63,700 to the
limited partners and $7,078 to the general partners. Cash basis income for the
quarter ended March 31, 1997 was $69,199. This was derived by adding
depreciation and amortization expense to net income. Thus, cash distributions
this quarter were less ($12,577) than cash basis net income. In contrast,
distributions during the quarter ending March 31, 1996 were less ($2,777) than
cash basis net income. Cash distributions were significantly less than cash
available for distribution in anticipation of lower rental income at the Yorba
Center property, as tenants' leases come up for renewal at rental rates that are
expected to be lower than current rates.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
RESULTS OF OPERATIONS (CONT.)
Overall, the Partnership generated $69,199 in income from operations before
depreciation expense of $25,613 for the quarter ended March 31, 1997. This
compares unfavorably to the quarter ending March 31, 1996 when income from
operations totaled $73,555 before depreciation of $24,555. Net income per
limited partnership unit decreased from $8.22 in 1996 to $7.25 in 1997. The
number of limited partnership units outstanding in each quarter was 5,096.
In summary then, the operating performance of the Partnership continued to
improve and all properties were operating profitably. There are currently no
plans to dispose of either of the two properties.
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
PART II
O T H E R I N F O R M A T I O N
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBIT AND REPORTS ON FORM 8-K
(a) Information required under this section has been included in
the financial statements.
(b) Reports on Form 8-K
None
<PAGE>
ASSOCIATED PLANNERS REALTY INCOME FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
S I G N A T U R E S
Pursuant to the requirements 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)
May 14, 1997 By: WEST COAST REALTY ADVISORS, INC.
A California Corporation,
A General Partner
Neal E. Nakagiri
Director and Executive Vice President/Secretary
May 14, 1997
Michael G. Clark
Vice President/Treasurer
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<CIK> 0000808420
<NAME> ASSOCIATED PLANNERS REALTY INCOME FUND LP
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 72,433
<SECURITIES> 0
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<ALLOWANCES> 0
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0
0
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<OTHER-SE> 4,229,031
<TOTAL-LIABILITY-AND-EQUITY> 4,259,248
<SALES> 101,757
<TOTAL-REVENUES> 102,017
<CGS> 58,431
<TOTAL-COSTS> 58,431
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 43,586
<INCOME-TAX> 0
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<CHANGES> 0
<NET-INCOME> 43,586
<EPS-PRIMARY> 7.25
<EPS-DILUTED> 7.25
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