SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-16816
SUMMIT TAX EXEMPT L.P. III
(Exact names of registrant as specified in its charter)
Delaware 13-3442249
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
625 Madison Avenue, New York, New York 10022
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 421-5333
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>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
STATEMENTS OF FINANCIAL CONDITION
(unaudited)
============================
June 30, December 31,
1997 1996
------------ ------------
ASSETS
Participating first mortgage bonds-at fair value $ 44,769,792 $ 44,769,792
Temporary investments 200,000 300,000
Cash and cash equivalents 136,826 59,832
Interest receivable, net 129,358 164,883
Deferred bond selection fees, net 636,939 667,755
------------ ------------
Total assets $ 45,872,915 $ 45,962,262
============ ============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses $ 113,514 $ 124,106
Due to affiliates 240,154 100,261
------------ ------------
Total liabilities 353,668 224,367
------------ ------------
Contingencies
Partners' capital (deficit):
BUC$holders (3,081,625 BUC$
issued and outstanding) 48,875,621 49,089,896
General Partners (176,166) (171,793)
Net unrealized loss on participating first
mortgage bonds (3,180,208) (3,180,208)
------------ ------------
Total partners' capital 45,519,247 45,737,895
------------ ------------
Total liabilities and partners' capital $ 45,872,915 $ 45,962,262
============ ============
See accompanying notes to financial statements
2
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
STATEMENTS OF FINANCIAL CONDITION
(unaudited)
<TABLE>
<CAPTION>
======================= =======================
Three Months Ended Six Months Ended
June 30, June 30,
----------------------- -----------------------
1997 1996 1997 1996
----------------------- -----------------------
<S> <C> <C> <C> <C>
Revenues:
Interest income:
Participating first mortgage
bonds $ 784,279 $ 773,291 $1,489,796 $1,472,708
Temporary investments 2,225 3,475 4,618 6,789
---------- ---------- ---------- ----------
Total revenues 786,504 776,766 1,494,414 1,479,497
---------- ---------- ---------- ----------
Expenses:
General and administrative 56,882 57,206 103,588 103,896
Loan servicing fees 32,692 32,692 65,024 65,383
Amortization of deferred bond
selection fees 15,408 15,408 30,816 30,815
---------- ---------- ---------- ----------
Total expenses 104,982 105,306 199,428 200,094
---------- ---------- ---------- ----------
Net Income $ 681,522 $ 671,460 $1,294,986 $1,279,403
========== ========== ========== ==========
Allocation of Net Income:
BUC$holders $ 603,816 $ 593,955 $1,141,640 $1,125,664
========== ========== ========== ==========
General Partners:
Special distribution $ 65,383 $ 65,383 $ 130,047 $ 130,766
Other 12,323 12,122 23,299 22,973
---------- ---------- ---------- ----------
$ 77,706 $ 77,505 $ 153,346 $ 153,739
========== ========== ========== ==========
Net Income per BUC $ .20 $ .19 $ .37 $ .36
========== ========== ========== ==========
</TABLE>
See accompanying notes to financial statements
3
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(unaudited)
<TABLE>
<CAPTION>
===============================================================
Net Unrealized
Loss on
General Participating First
Total BUC$holders Partners Mortgage Bonds
---------------------------------------------------------------
<S> <C> <C> <C> <C>
Partners' capital (deficit) -
January 1, 1997 $ 45,737,895 $ 49,089,896 $ (171,793) $ (3,180,208)
Net income 1,294,986 1,141,640 153,346 0
Distributions (1,513,634) (1,355,915) (157,719) 0
------------ ------------ ------------ ------------
Partners' capital (deficit) - $ 45,519,247 $ 48,875,621 $ (176,166) $ (3,180,208)
June 30, 1997
============ ============ ============ ============
</TABLE>
See accompanying notes to financial statements
4
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
==========================
Six Months Ended
June 30,
--------------------------
1997 1996
--------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Interest received, net $ 1,529,939 $ 1,478,413
Fees and expenses paid (104,694) (82,649)
----------- -----------
Net cash provided by operating activities 1,425,245 1,395,764
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Net sale (purchase) of temporary investments 100,000 (100,000)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions paid (1,448,251) (1,448,969)
----------- -----------
Net increase (decrease) in cash and cash equivalents 76,994 (153,205)
Cash and cash equivalents at beginning of period 59,832 347,908
----------- -----------
Cash and cash equivalents at end of period $ 136,826 $ 194,703
=========== ===========
SCHEDULE RECONCILING NET INCOME TO NET CASH
FLOW PROVIDED BY OPERATING ACTIVITIES:
Net income $ 1,294,986 $ 1,279,403
----------- -----------
Adjustments to reconcile net income to net cash
provided by operating activities:
Amortization of deferred bond selection fees 30,816 30,815
Changes in:
Interest receivable, net 35,525 (1,084)
Other assets 0 4,209
Accounts payable and accrued expenses (10,592) 22,463
Due to affiliates 74,510 59,958
----------- -----------
Total adjustments 130,259 116,361
----------- -----------
Net cash provided by operating activities $ 1,425,245 $ 1,395,764
=========== ===========
SUPPLEMENTAL SCHEDULE OF FINANCING ACTIVITIES
Distributions to partners $(1,513,634) $(1,514,352)
Increase in distributions payable 65,383 65,383
----------- -----------
Distributions paid to partners $(1,448,251) $(1,448,969)
=========== ===========
</TABLE>
See accompanying notes to financial statements
5
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(unaudited)
NOTE 1 - General
These financial statements have been prepared without audit. In the opinion
of management, the financial statements contain all adjustments (consisting of
only normal recurring adjustments) necessary to present fairly the financial
position of Summit Tax Exempt L.P. III (the "Partnership") as of June 30, 1997,
the results of its operations for the three and six months ended June 30, 1997
and 1996 and its cash flows for the six months ended June 30, 1997 and 1996.
However, the operating results for the interim periods may not be indicative of
the results expected for the full year.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been omitted. It is suggested that these financial statements be read in
conjunction with the financial statements and notes thereto included in the
Partnership's Annual Report on Form 10-K filed with the Securities and Exchange
Commission for the year ended December 31, 1996.
NOTE 2 - Participating First Mortgage Bonds ("FMBs")
The Partnership accounts for its investments in the FMBs as "available for
sale" debt securities under the provisions of Statement of Financial Accounting
Standards No. 115, "Accounting for Certain Investments in Debt and Equity
Securities" ("SFAS 115"). Accordingly, investments in FMBs are carried at their
estimated fair values, with unrealized gains and losses reported in a separate
component of partners' capital.
Because the FMBs are not readily marketable, the Partnership estimates fair
value for each bond as the present value of its expected cash flows using a
discount rate for comparable tax-exempt investments. This process is based upon
projections of future economic events affecting the real estate collateralizing
the bonds, such as property occupancy rates, rental rates, operating cost
inflation and market capitalization rates, and upon determination of an
appropriate market rate of interest, all of which are based on good faith
estimates and assumptions developed by the Partnership's management. Changes in
market conditions and circumstances may occur which would cause these estimates
and assumptions to change, therefore, actual results may vary from the estimates
and the variance may be material.
Effective January 1, 1997, a forbearance agreement with respect to the
Players Club FMB was modified and extended due to a continuing weak rental
market and to ensure that real estate tax payments and certain capital repairs
and improvements are made. The minimum pay rate for Players Club was reduced to
6.5% and 6.25% for the periods January 1, 1997 through January 31, 1997 and
February 1, 1997 through December 31, 1997, respectively. Thereafter, it is
expected that the stated rate of 8% will be reinstated.
On May 12, 1997, Summit Tax Exempt L.P. II, of which the general partners
are either the same or affiliates of the general partners of this Partnership,
loaned the obligor of the Players Club FMB $280,000 to cover the shortfall on
its 1996 real estate tax payment and to fund a capital improvement account. The
note is self-amortizing beginning July 1, 1997, at an annual interest rate of
8%, is payable in 48 equal monthly installments of $6,835.62 and matures on May
1, 2001.
6
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(unaudited)
NOTE 2 - Participating First Mortgage Bonds ("FMBs") (continued)
With respect to all FMBs, the difference between the stated interest rates
and the actual rates paid (whether deferred and payable out of future cash flow
or, ultimately, from sale or refinancing proceeds) on FMBs is not accrued for
financial statement purposes. Unrecorded contractual interest income was
approximately $741,000 and $760,000 for the six months ended June 30, 1997 and
1996, respectively.
The cost basis of the FMBs was $47,950,000 at June 30, 1997 and December
31, 1996. The net unrealized loss on FMBs consists of gross unrealized gains and
losses of $0 and $3,180,208, respectively, at both June 30, 1997 and December
31, 1996.
7
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(unaudited)
NOTE 2 - Participating First Mortgage Bonds ("FMBs") (continued)
Descriptions of the various FMBs owned by the Partnership at June 30, 1997 are
as follows:
<TABLE>
<CAPTION>
Annualized
Interest Rate
Paid for the Minimum
six months Annual Carrying
ended Pay Rate at Stated Amount at
June 30, June 30, Interest Maturity June 30,
Property Location 1997* 1997* Rate* Call Date Date Face Amount 1997(C)
- - -------- -------- -------------- ---------- -------- ---------- --------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Players Club(A) Fort Myers, FL 6.37% 6.25% 8.00% Aug. 1999 Aug. 2007 $ 7,200,000 $ 6,843,428
Lakepointe Dekalb County, GA 6.00 6.00 8.50 Jan. 2000 Oct. 2007 15,100,000 14,159,707
Sunset Village Lancaster, CA 4.41 (B) 8.50 Mar. 2000 Mar. 2008 11,375,000 9,085,396
Sunset Creek Lancaster, CA 4.67 (B) 8.50 Mar. 2000 Mar. 2008 8,275,000 6,004,427
Orchard Mill Atlanta, GA 7.49(D) 5.00 9.00 Apr. 2001 Mar. 2008 10,500,000 8,676,834
----------- -----------
$52,450,000 $44,769,792
=========== ===========
</TABLE>
*The annualized interest rate paid represents the interest recorded by the
Partnership while the stated interest rate represents the coupon rate of the FMB
and the minimum annual pay rate represents the minimum rate required to be paid
under the respective forbearance agreements.
(A) Summit Tax Exempt L.P. II, of which the general partners are either the
same or affiliates of the General Partners of the Partnership, acquired the
other $2,500,000 of the Players Club Bond issue.
(B) Interest on this FMB is paid to the extent of the property's net cash flow.
(C) FMBs are carried at their estimated fair values at June 30, 1997.
(D) Includes receipt of deferred base interest related to prior periods.
8
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(unaudited)
NOTE 3 - Related Parties
Prudential-Bache Properties, Inc. ("PBP") and the Related General Partner
(collectively, the "General Partners") and their affiliates perform services for
the Partnership which include, but are not limited to: accounting and financial
management; registrar, transfer and assignment functions; asset management;
investor communications; printing and other administrative services. The General
Partners and their affiliates receive reimbursements for costs incurred in
connection with these services, the amount of which is limited by the provisions
of the Agreement of Limited Partnership (the "Partnership Agreement"). The costs
and expenses were:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------- -------------------
1997 1996 1997 1996
------------------- -------------------
<S> <C> <C> <C> <C>
PBP and affiliates:
General and administrative $ 10,682 $ 3,172 $ 21,365 $ 18,284
-------- -------- -------- --------
Related General Partner and affiliates:
Loan servicing fees 32,692 32,692 65,024 65,383
General and administrative 14,000 12,323 20,345 27,323
-------- -------- -------- --------
46,692 45,015 85,369 92,706
-------- -------- -------- --------
$ 57,374 $ 48,187 $106,734 $110,990
======== ======== ======== ========
</TABLE>
An affiliate of the Related General Partner receives loan servicing fees
(see above) in an amount of .25% per annum of the principal amount outstanding
of mortgage loans serviced by the affiliate.
During January 1996, a division of Prudential Securities Incorporated
("PSI"), an affiliate of PBP, was responsible for the purchase, sale and
safekeeping of the Partnership's temporary investments. This account was
maintained in accordance with the Partnership Agreement.
PSI owns 17,700 BUC$ at June 30, 1997.
The Players Club property (securing a $7,200,000 FMB in this Partnership)
also secures an FMB for $2,500,000 held by Summit Tax Exempt L.P. II, of which
the general partners are either the same or affiliates of the General Partners
of this Partnership. The original owner of the FMB is an affiliate of the
Related General Partner.
Effective as of August 1, 1995, the original owner and obligor of the
Sunset Creek and Sunset Village FMBs transferred the deeds to the underlying
properties to an affiliate of the Related General Partner for limited
consideration. Pursuant to the agreement, the Related General Partner's
affiliate, who has not made an equity investment in the underlying properties,
assumed the day-to-day responsibilities and obligations of operating the
properties.
NOTE 4 - Contingencies
Previous quarterly and annual reports by the Partnership have disclosed the
commencement and status of the putative class actions captioned Kinnes, et al.
v. Prudential Securities Group, Inc., et al., CV-93-654 (D.Az.), Connelly, et.
al v. Prudential-Bache Securities, Inc., et al. 93 Civ. 713 (D. Az.), and Levine
v. Prudential-Bache Properties, Inc., et. al. 92 Civ. 52 (N.D., Ill.). These
putative class actions were transferred along with certain other cases, by the
Judicial
9
<PAGE>
SUMMIT TAX EXEMPT L.P. III
(a limited partnership)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997
(unaudited)
NOTE 4 - Contingencies (continued)
Panel on Multidistrict Panel to a single judge of the United States
District Court for the Southern District of New York (the "Court") for
consolidated and coordinated pre-trial proceedings under the caption In re
Prudential Securities Incorporated Limited Partnerships Litigation, MDL Docket
No. 1005 (the "Class Action"). As previously disclosed in the last quarterly
report, the Related General Partner and certain of its affiliates entered in
December 1996, into a stipulation of settlement with counsel for plaintiffs to
settle the Class Action against the Related General Partner and certain of its
affiliates (the "Related Settlement").
On June 11, 1997, the Court issued orders that, inter alia, approved the
solicitation statement describing in detail the transactions contemplated
pursuant to the proposed Related Settlement, directed that it be mailed along
with the class notice to the members of the class and rescheduled the settlement
fairness hearing to consider the final approval of the Related Settlement for
August 28, 1997. In accordance with the Court's orders, the solicitation
statement and class notice were mailed to BUC$holders of the Partnership.
There can be no assurance that the conditions to the closing of the
proposed Related Settlement and the reorganization of the Partnership (as
disclosed in previous quarterly and annual reports and in the solicitation
statement and class notice) will be satisfied nor as to the time frame as to
which the closing may occur. In the event that the Related Settlement is not
consummated, the Related General Partner believes it has meritorious defenses to
the Class Action and intends to defend this action vigorously.
NOTE 5 - Subsequent Event
In August 1997, a distribution of approximately $678,000 and $79,000 was
paid to the BUC$holders and General Partners, respectively, for the quarter
ended June 30, 1997.
10
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Liquidity and Capital Resources
Summit Tax Exempt L.P. III (the "Partnership") has invested in five
tax-exempt participating first mortgage bonds ("FMBs") issued by various state
or local governments or their agencies or authorities. The FMBs are secured by
participating first mortgage loans on the properties.
At the beginning of the year, the Partnership had cash and temporary
investments of approximately $360,000. After receipt of the net cash flow from
operations of approximately $1,425,000 and the payment of distributions of
approximately $1,448,000, the Partnership had approximately $337,000 in cash and
temporary investments at June 30, 1997. The second quarter distribution of
$678,000 ($.22 per BUC) was paid to BUC$holders in August 1997 from cash flow
from operations. Interest payments from FMBs are anticipated to provide
sufficient liquidity to fund in future years the Partnership's operating
expenditures and distributions. The restructuring of the FMBs in 1997 and prior
years and any future restructurings may result in the General Partners reducing
the distributions to BUC$holders in future periods.
Effective January 1, 1997, a forbearance agreement with respect to the
Players Club FMB was modified and extended due to a continuing weak rental
market and to ensure that real estate tax payments and certain capital repairs
and improvements are made. The minimum pay rate for Players Club was reduced to
6.5% and 6.25% for the periods January 1, 1997 through January 31, 1997 and
February 1, 1997 through December 31, 1997, respectively. Thereafter, it is
expected that the stated rate of 8% will be reinstated.
On May 12, 1997, Summit Tax Exempt L.P. II, of which the general partners
are either the same or affiliates of the General Partners of this Partnership,
loaned the obligor of the Players Club FMB $280,000 to cover the shortfall on
its 1996 real estate tax payment and to fund a capital improvement account. The
note is self-amortizing beginning July 1, 1997, at an annual interest rate of
8%, is payable in 48 equal monthly installments of $6,835.62 and matures on May
1, 2001.
For a discussion of the proposed settlement of the Class Action relating to
the Partnership, see Note 4 to the financial statements.
Management is not aware of any trends or events, commitments or
uncertainties, which have not otherwise been disclosed that will or are likely
to impact liquidity in a material way. The Partnership's investments in FMBs are
secured by a Partnership interest in properties which are diversified by
location so that if one area of the country is experiencing downturns in the
economy, the remaining properties may be experiencing upswings. However, the
geographic diversification of the portfolio may not protect against a general
downturn in the national economy.
Results of Operations
Net income increased approximately $10,000 and $16,000, respectively, for
the three and six months ended June 30, 1997 as compared to 1996 for the reason
discussed below.
Interest income from FMBs increased approximately $11,000 and $17,000 ,
respectively, for the three and six months ended June 30, 1997, as compared to
1996 primarily due to increased debt service payments received from the Orchard
Mill (including the receipt of deferred base interest relating to prior periods)
and Sunset Creek FMBs, partially offset by a decrease in debt service payments
received from the Players Club FMB.
11
<PAGE>
General
The determination as to whether it is in the best interest of the
Partnership to enter into forbearance agreements on the FMBs or, alternatively,
to pursue its remedies under the loan documents, including foreclosure, is based
upon several factors including, but not limited to, property performance, owner
cooperation and projected legal costs.
From time to time, certain property owners have elected to supplement the
cash flow generated by the properties to meet the required FMB interest
payments. There can be no assurance that in the future any property owner will
elect to supplement property cash flow to satisfy bond interest requirements, if
necessary. No property owner made supplementary payments during the six months
ended June 30, 1996. In 1997, the obligor under the Orchard Mill FMB made
increased payments from proceeds from a partial sale of his equity interests to
a third party. Such proceeds were used for payment of deferred maintenance items
and toward accrued and unpaid interest due under the FMB.
Property Information
The following table lists the FMBs the Partnership owns together with occupancy
rates of the underlying properties as of June 30, 1997:
<TABLE>
<CAPTION>
Annualized
Interest Minimum
Rate Paid Annual
for the six Pay Rate
Stated months ended at
Interest June 30, June 30,
Property Face Amount Occupancy Rate* 1997* 1997*
- - -------- ----------- --------- ----- ------------ --------
<S> <C> <C> <C> <C> <C>
Players Club, Fort Myers, FL (A) $ 7,200,000 77.7% 8.00% 6.37% 6.25%
Lakepointe, Dekalb County, GA 15,100,000 87.7 8.50 6.00 6.00
Sunset Village, Lancaster, CA 11,375,000 98.0 8.50 4.41 (B)
Sunset Creek, Lancaster, CA 8,275,000 97.9 8.50 4.67 (B)
Orchard Mill, Atlanta, GA 10,500,000 97.0 9.00 7.49(C) 5.00
-------------
$ 52,450,000
=============
</TABLE>
*The annualized interest rate paid represents the interest recorded by the
Partnership while the stated interest rate represents the coupon rate of the FMB
and the minimum annual pay rate represents the minimum rate required to be paid
under the respective forbearance agreements.
(A) Summit Tax Exempt L.P. II, of which the general partners are either the
same or affiliates of the General Partners of the Partnership, acquired the
other $2,500,000 of the Players Club Bond issue.
(B) Interest on this FMB is paid to the extent of the property's net cash flow.
(C) Includes receipt of deferred base interest related to prior periods.
12
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings - Incorporated by reference to Note 4 to the financial
statements filed herewith in Item 1 of Part 1 of the Registrant's Quarterly
Report.
Item 2. Changes in Securities - None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders - None
Item 5. Other Information
Thomas F. Lynch, III ceased to serve as President, Chief Executive Officer,
Chairman of the Board of Directors and Director of Prudential-Bache Properties,
Inc. effective May 2, 1997. Effective May 2, 1997, Brian J. Martin was elected
President, Chief Executive Officer, Chairman of the Board of Directors and
Director of Prudential-Bache Properties, Inc.
Solicitation information was mailed to BUC$holders in connection with the
proposed Related Settlement (see Note 4 to the financial statements filed
herewith in Item 1 of Part I of the Registrant's Quarterly Report).
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
4(a) Partnership Agreement, incorporated by reference to Exhibit A to
the Prospectus of Registrant, dated February 25, 1987, filed pursuant to
Rule 424(b) under the Securities Act of 1933, File No. 33-13184.
4(b) Certificate of Limited Partnership is incorporated by reference
to Exhibit 4 to the Registration Statement on Form S-11, File No. 33-13184.
10(n) Amended Forbearance Agreement for the Players Club First
Mortgage Bond dated December 1, 1996 (incorporated by reference to Exhibit
10(n) in the Registrant's March 31, 1997 Quarterly Report on Form 10-Q).
27 Financial Data Schedule (filed herewith).
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter.
13
<PAGE>
SIGNATURES
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.
SUMMIT TAX EXEMPT L.P. III
By: Related Tax Exempt Associates III, Inc.
A Delaware corporation, General Partner
Date: August 13, 1997 By: /s/ Alan P. Hirmes
------------------
Alan P. Hirmes
Vice President
(Principal Financial Officer)
Date: August 13, 1997 By: /s/ Richard A. Palermo
----------------------
Richard A. Palermo
Treasurer
(Principal Accounting Officer)
By: Prudential-Bache Properties, Inc.
A Delaware corporation, General Partner
Date: August 13, 1997 By: /s/ Eugene D. Burak
-------------------
Eugene D. Burak
Vice President
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial information extracted from the financial
statements for Summit Tax Exempt L.P. III and is qualified in its entirety by
reference to such financial statements
</LEGEND>
<CIK> 0000812220
<NAME> Summit Tax Exempt L.P. III
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<FISCAL-YEAR-END> DEC-31-1997
<CASH> 136,826
<SECURITIES> 44,969,792
<RECEIVABLES> 129,358
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 45,872,915
<CURRENT-LIABILITIES> 353,668
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 45,519,247
<TOTAL-LIABILITY-AND-EQUITY> 45,872,915
<SALES> 0
<TOTAL-REVENUES> 1,494,414
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 199,428
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,294,986
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,294,986
<EPS-PRIMARY> .37
<EPS-DILUTED> 0
</TABLE>
