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 0-17685
BASS INCOME PLUS FUND LIMITED PARTNERSHIP
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(EXACT NAME OF PARTNERSHIP AS SPECIFIED IN ITS CHARTER)
NORTH CAROLINA 56-1544869
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(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
4000 PARK ROAD CHARLOTTE, NORTH CAROLINA 28209
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE) (ZIP CODE)
PARTNERSHIP'S TELEPHONE NUMBER, INCLUDING AREA CODE: (704) 523-9407
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INDICATE BY CHECK MARK WHETHER THE PARTNERSHIP (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
PARTNERSHIP WAS REQUIRED TO FILE SUCH REPORTS), AND [2] HAS BEEN SUBJECT TO SUCH
FILING REQUIREMENTS FOR THE PAST 90 DAYS.
YES X NO
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BASS INCOME PLUS FUND LIMITED PARTNERSHIP
INDEX
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PAGE
NUMBER
PART I. FINANCIAL INFORMATION:
ITEM 1. FINANCIAL STATEMENTS
CONDENSED BALANCE SHEET
AS OF MARCH 31, 1997
(UNAUDITED) 3
CONDENSED STATEMENT OF INCOME
THREE MONTHS ENDED
MARCH 31, 1997 AND 1996
(UNAUDITED) 4
STATEMENT OF PARTNERS' EQUITY (DEFICIT) 5
(UNAUDITED)
CONDENSED STATEMENT OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(UNAUDITED) 6
NOTES TO CONDENSED FINANCIAL
STATEMENTS (UNAUDITED) 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF
OPERATIONS 9
PART II. OTHER INFORMATION 10
SIGNATURES 11
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BASS INCOME PLUS FUND LIMITED PARTNERSHIP
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CONDENSED BALANCE SHEET
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MARCH 31, DECEMBER 31,
1997 1996
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ASSETS (UNAUDITED)
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RENTAL PROPERTIES, AT COST:
LAND $1,206,000 $1,206,000
BUILDINGS 9,729,194 9,729,194
FURNISHINGS AND FIXTURES 943,528 943,528
ACCUMULATED DEPRECIATION (3,448,893) (3,337,023)
------------ -------------
8,429,829 8,541,699
CASH AND CASH INVESTMENTS 751,939 654,810
RESTRICTED ESCROW DEPOSITS 39,493 38,280
DEFERRED COSTS AND OTHER ASSETS, NET 170,050 142,862
------------ -------------
TOTAL ASSETS $9,391,311 $9,377,651
============ =============
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
-----------------------------------------------
MORTGAGE LOANS PAYABLE $8,918,476 $8,940,661
SECURITY DEPOSITS 33,490 32,395
ACCRUED LIABILITIES 51,614 26,052
------------ -------------
TOTAL LIABILITIES 9,003,580 8,999,108
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PARTNERS' EQUITY (DEFICIT):
LIMITED PARTNERS' INTEREST 412,730 403,634
GENERAL PARTNERS' DEFICIT (24,999) (25,091)
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TOTAL PARTNERS' EQUITY 387,731 378,543
------------ -------------
TOTAL LIABILITIES AND PARTNERS' EQUITY $9,391,311 $9,377,651
============ =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL
PART OF THE FINANCIAL STATEMENTS.
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BASS INCOME PLUS FUND LIMITED PARTNERSHIP
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CONDENSED STATEMENT OF INCOME
-------------------------------------------------------------------------
(UNAUDITED)
THREE MONTHS THREE MONTHS
ENDED ENDED
MARCH 31, MARCH 31,
1997 1996
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REVENUE:
RENTAL INCOME $527,550 $510,051
INTEREST INCOME 9,456 6,547
OTHER OPERATING INCOME 24,224 25,985
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561,230 542,583
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OPERATING EXPENSES:
FEES AND EXPENSES TO AFFILIATES 79,430 69,696
PROPERTY TAXES AND INSURANCE 36,114 34,737
UTILITIES 30,750 31,868
REPAIRS AND MAINTENANCE 32,536 35,963
ADVERTISING 9,257 8,766
DEPRECIATION AND AMORTIZATION 116,058 112,668
OTHER 4,560 10,137
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308,705 303,835
INTEREST EXPENSE 212,166 214,169
NONOPERATING EXPENSES 31,171 15,174
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TOTAL EXPENSES 552,042 533,178
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NET INCOME $9,188 $9,405
========= ============
NET INCOME ALLOCATED TO GENERAL PARTNERS $92 $94
========= ============
NET INCOME ALLOCATED TO LIMITED PARTNERS $9,096 $9,311
========= ============
NET INCOME PER LIMITED PARTNERSHIP UNIT, BASED
ON NUMBER OF UNITS OUTSTANDING (61,928) $0.15 $0.15
========= ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL
PART OF THE FINANCIAL STATEMENTS.
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BASS INCOME PLUS FUND LIMITED PARTNERSHIP
---------------------------------------------------
STATEMENT OF PARTNERS' EQUITY
(DEFICIT)
---------------------------------------------------
(UNAUDITED)
LIMITED GENERAL
PARTNERS PARTNERS TOTAL
--------------- ---------------- --------------
BALANCE, JANUARY 1, 1997 $403,634 ($25,091) $378,543
NET INCOME 9,096 92 9,188
--------------- ---------------- --------------
BALANCE, MARCH 31, 1997 $412,730 ($24,999) $387,731
=============== ================ ==============
LIMITED GENERAL
PARTNERS PARTNERS TOTAL
-------------- ---------------- --------------
BALANCE, JANUARY 1, 1996 $758,584 ($25,546) $733,038
NET INCOME 9,311 94 9,405
-------------- ---------------- --------------
BALANCE, MARCH 31, 1996 $767,895 ($25,452) $742,443
============== ================ ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL
PART OF THE FINANCIAL STATEMENTS.
-5-
<PAGE>
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CONDENSED STATEMENT OF CASH FLOWS
---------------------------------------------------------------
(UNAUDITED)
THREE MONTHS THREE MONTHS
ENDED ENDED
MARCH 31, MARCH 31,
1997 1996
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CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME $ 9,188 $ 9,405
ADJUSTMENTS TO RECONCILE NET LOSS TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES-
DEPRECIATION AND AMORTIZATION 116,058 112,668
CHANGE IN ASSETS AND LIABILITIES:
INCREASE IN ACCRUED AND OTHER LIABILITIES 25,562 20,654
INCREASE IN ESCROWS AND OTHER ASSETS, NET (31,494) (18,097)
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NET CASH PROVIDED BY OPERATING ACTIVITIES 119,314 124,630
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CASH FLOWS FROM INVESTING ACTIVITIES:
ADDITIONS TO RENTAL PROPERTIES 0 (11,736)
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CASH FLOWS FROM FINANCING ACTIVITIES:
REPAYMENT OF MORTGAGE LOANS (22,185) (20,182)
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NET INCREASE IN CASH AND CASH INVESTMENTS 97,129 92,712
CASH AND CASH INVESTMENTS, BEGINNING OF YEAR 654,810 727,160
----------- ----------
CASH AND CASH INVESTMENTS, MARCH 31 $751,939 $819,872
=========== ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL
PART OF THE FINANCIAL STATEMENTS.
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BASS INCOME PLUS FUND LIMITED PARTNERSHIP
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. ORGANIZATION
Bass Income Plus Fund Limited Partnership (the Partnership) was organized
to engage in the acquisition of specified parcels of undeveloped real estate and
to construct, develop, operate, hold and dispose of income-producing,
multifamily residential apartment complexes. At formation, the limited
partnership interest consisted of two classes of units, income units and growth
units. Each investment in limited partnership interest consisted of 60% income
units and 40% growth units. Limited partnership interests had been sold at $100
per unit for a total of $15,482,000. During December 1989, the Partnership
obtained mortgage financing on the rental properties. The proceeds from the
mortgage financing were used to return the full amount of the capital
contributions to the income unit holders for a total distribution of $9,289,200.
Under the terms of the partnership agreement, net income (loss) is to be
allocated 99% to the limited partners and 1% to the general partners. Cash
distributions from operations are to be distributed 100% to the limited
partners. Upon the sale or refinance of the partnership properties, the
partnership agreement specifies certain allocations of net proceeds and taxable
gain or loss from the transaction.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Partnership records are maintained on the accrual basis of accounting
in accordance with generally accepted accounting principles.
In the opinion of management, the accompanying unaudited financial
statements reflect all adjustments (which include only normal recurring
adjustments) necessary to present fairly the Partnership's financial position as
of March 31, 1997, results of operations for the three months ended March 31,
1997 and 1996, and cash flow for the three months ended March 31, 1997 and 1996.
3. RENTAL PROPERTIES
The rental properties consist of three residential apartment complexes:
Arrowood Crossing, The Chase and Sabal Point II. All were constructed by an
affiliate of the general partners and contain 80, 120 and 88 rental units,
respectively. The complexes are located on three plots of land purchased in 1988
from the managing general partner or an affiliate of the general partners.
Affiliates of the general partners own residential apartment complexes
adjacent to Arrowood Crossing and Sabal Point II. These complexes are sharing
expenses related to grounds, maintenance, leasing, management and other related
costs. The managing general partner believes that the allocation of expenses to
each partnership has been made on a reasonable basis.
The Partnership has three mortgage loans payable to a financial institution
secured by the three rental properties. Interest of 9.5% was payable monthly
through February 1992. Thereafter, principal and interest are due in payments
totaling $78,117 with the remaining principal and any accrued interest due upon
maturity in January 2000.
4. GENERAL PARTNERS AND RELATED PARTY TRANSACTIONS
The general partners are Marion F. Bass (The Individual General Partner)
and Marion Bass Real Estate Group, Inc., (The Managing General Partner). The
rental properties are managed by Marion Bass Properties, Inc., which is wholly
owned by Marion F. Bass.
7
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Under the terms of the partnership agreement, the general partners or their
affiliates charged certain fees and expenses during the three-month period
ending March 31, 1997 as follows:
Management fee of 5% of gross revenues $27,390
Reimbursed maintenance salaries and benefits 26,648
Reimbursed property manager salaries and benefits 25,392
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$79,430
The Partnership receives from an affiliated partnership an agreed-upon
amount each year for the use of its pool and clubhouse located on the
Partnership's property. The Partnership has recorded as other operating income
$3,408 for the three months ended March 31, 1997 under the terms of this
agreement.
The general partners and certain of their affiliates also perform, without
cost to the Partnership, day-to-day investment, management and administrative
functions of the Partnership.
8
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1997, partners' equity was $387,731 or 4% of total assets and
cash and cash reserves amounted to $751,939. The Partnership had accrued
liabilities of $51,614 that consisted of 1997 property taxes of $31,356,
management fees due to an affiliate of $9,209, trade accounts payable of $9,031
and resident prepaid rent of $2,018.
Net cash provided by operations totaled $119,314 for the three months ended
March 31, 1997. This is compared to net cash provided by operations of $124,630
for the corresponding period in 1996. The Partnership had three 9.5% mortgage
loans in the amount of $8,918,476 outstanding at March 31, 1997. Principal
payments of $22,185 were made during the three month period ended March 31, 1997
on the amortizing mortgage loans.
The 1997 operating plan and budget projects a net cash flow from partnership
activities (exclusive of changes in assets and liabilities and distribution to
partners) of $42,000 at Arrowood Crossing, $220,000 at The Chase, and $135,000
at Sabal Point II. The budget assumes that the Partnership will achieve
occupancy rates equivalent to 95% at Arrowood Crossing, 98% at The Chase and 95%
at Sabal Point II. For the three months ended March 31, 1997, actual combined
average economic occupancy was 97% and actual net cash flow from partnership
activities (exclusive of changes in assets and liabilities and distribution to
partners) was $103,061. Rents have been increased 3% over rates charged in 1996
to offset any normal increase in operating expenses. Capital expenditures of
$74,000, $30,000 and $32,000 are budgeted for Arrowood Crossing, The Chase and
Sabal Point II, respectively, and include mainly selected carpet and vinyl
replacements and exterior painting of Arrowood Crossing. As of March 31, 1997,
actual nonrecurring replacement expenses and additions to rental properties have
totaled $12,048, $9,279 and $3,301, respectively. On the basis of these
estimates and year-to-date results, the Partnership believes that the cash flow
from operations will be sufficient to meet cash requirements, build cash
reserves and provide distributions to partners. An undetermined amount provided
by cash reserves and 1996 operational net cash flow will be distributed to
limited partners during the second quarter of 1997.
RESULTS OF OPERATIONS
The following discussion relates to the Partnership's operation of Arrowood
Crossing, The Chase and Sabal Point II for the three months ended March 31, 1997
and 1996.
Results of operations for the three months ended March 31, 1997 reflect an
average economic occupancy of 97% compared to 98% for the corresponding period
in 1996. A first quarter comparison of 1997 and 1996 reflects higher rental
income of $17,499 during 1997 due to rents being increased 3% over rates charged
in 1996. Other operating income was lower by $1,761. Overall, total income for
the first quarter ended March 31, 1997 was $18,647 higher than the corresponding
period in 1996.
Operating expenses were $308,705 for the three months ended March 31, 1997,
compared to $303,835 for the corresponding period in 1996 which reflects a
variance of $4,870. Fees and expenses to affiliates that consist of a management
fee of 5% of gross revenues and the reimbursement of complex employee salaries
and benefits were higher by $9,734. This increase was due to the hiring of
additional maintenance personnel. Property taxes and insurance were higher by
$1,377 due to increased rates.
After interest expense of $212,166 and nonoperating expenses (partnership
expenses and nonrecurring replacement costs) of $31,171, partnership operations
recognized a net income of $9,188 for the three months ended March 31, 1997.
This is compared to a net income of $9,405 for the corresponding period in 1996.
9
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Response: None
Item 2. Changes in Securities
Response: None
Item 3. Defaults upon Senior Securities
Response: None
Item 4. Submission of Matters to a Vote of Security Holders
Response: None
Item 5. Other Information
Response: None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
3(a) Copy of Limited Partnership Agreement dated as of August 6,
1987, filed as Exhibit 3(a) to the Partnership's Form 10-K
Annual Report for the fiscal year ended December 31, 1987,
filed with the Securities and Exchange Commission, which is
incorporated herein by reference.
3(b) Copy of Certificate of Limited Partnership dated as of
January 5, 1987, filed as Exhibit 3(b) to the Partnership's
Form 10-K Annual Report for the fiscal year ended December
31, 1987, filed with the Securities and Exchange Commission,
which is incorporated herein by reference.
4(a) Specimen Certificate for Growth Units, filed as Exhibit 4(a)
of Amendment No. 1 to Partnership's Registration Statement on
Form S-11 (No. 33-11797), filed with the Securities and
Exchange Commission on April 23, 1987, which is incorporated
by reference to such Form S-11.
4(b) Specimen Certificate for Income Units filed as Exhibit 4(b)
of Amendment No. 1 to Partnership's Registration Statement on
Form S-11 (No. 33-11797), filed with the Securities and
Exchange Commission on April 23, 1987, which in incorporated
by reference to such Form S-11.
(b) Report on Form 8-K. No reports on Form 8-K were filed during
the quarter covered by this report.
10
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Partnership has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
BASS INCOME PLUS FUND LIMITED PARTNERSHIP
By: Marion Bass Real Estate Group, Inc. as Managing General Partner
By: Marion F. Bass, President
Date: May 1, 1997
By: Robert J. Brietz, Executive Vice President
Date: May 1, 1997
11
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<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Article Type 5 for Bass Income Plus Fund for Three Months Ended March 31, 1997.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 751,939
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 791,432
<PP&E> 11,878,722
<DEPRECIATION> 3,448,893
<TOTAL-ASSETS> 9,391,311
<CURRENT-LIABILITIES> 85,104
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 387,731
<TOTAL-LIABILITY-AND-EQUITY> 9,391,311
<SALES> 527,550
<TOTAL-REVENUES> 561,230
<CGS> 0
<TOTAL-COSTS> 308,705
<OTHER-EXPENSES> 31,171
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 212,166
<INCOME-PRETAX> 9,188
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 9,188
<EPS-PRIMARY> .15
<EPS-DILUTED> .15
</TABLE>
