<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
[ ] TRANSITION REPORT UNDER SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 0-17602
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Chrisken Partners Cash Income Fund L.P.
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(Exact name of small business issuer as Specified in its
certificate of Limited partnership)
Delaware 36-3521124
- --------------------------------- --------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
345 North Canal Street, Chicago, Illinois 60606
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(Address of principal executive offices) (Zip Code)
(312) 454-1626
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(Issuer's telephone number)
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(Former name, former address and formal fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act during the past 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 _____
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CHRISKEN PARTNERS CASH INCOME FUND L.P.
INDEX
<TABLE>
<CAPTION>
Page
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PART I Financial Information
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<S> <C>
Item 1. Consolidated Financial Statements
Consolidated Balance Sheet at
June 30, 1996 2
Consolidated Statements of Income
for the Three Months and Six Months
Ended June 30, 1996 and 1995 3
Consolidated Statement of Partners'
Capital for the Six Months Ended
June 30, 1996 4
Consolidated Statements of Cash Flows for
the Six Months Ended June 30, 1996
and 1995 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis or
Plan of Operation 7
PART II. Other Information
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Item 1. Legal Proceedings 10
Item 2. Changes in Securities 10
Item 3. Defaults Upon Senior Securities 10
Item 4. Submissions of Matters to a Vote of
Security Holders 10
Item 5. Other Information 10
Item 6. Exhibits and Reports on Form 8-K 10
SIGNATURE
</TABLE>
1
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Chrisken Partners Cash Income Fund L.P.
(A Delaware Limited Partnership)
Consolidated Balance Sheet
June 30, 1996
(Unaudited)
<TABLE>
<S> <C>
ASSETS
Cash and cash equivalents $ 572,552
Restricted cash 377,320
Accounts receivable 15,829
Prepaid expenses 10,457
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976,158
Investment in real estate, at cost:
Land 2,220,195
Buildings and improvements 13,960,111
Equipment 309,698
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16,490,004
Accumulated depreciation (3,942,638)
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12,547,366
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Total assets $13,523,524
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LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 46,894
Deferred income and prepaid rent 90,108
Tenants' security deposits 64,472
Accrued real estate taxes 236,631
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Total liabilities 438,105
Partners' capital, 37,309 limited
partnership units issued and
outstanding 13,085,419
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Total liabilities and partners' capital $13,523,524
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</TABLE>
See accompanying note.
2
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Chrisken Partners Cash Income Fund L.P.
(A Delaware Limited Partnership)
Consolidated Statements of Income
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
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1996 1995 1996 1995
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<S> <C> <C> <C> <C>
REVENUE
Rental $585,581 $565,290 $1,173,072 $1,126,372
Interest 8,711 6,873 18,085 16,155
Other 40,251 35,173 76,260 70,385
----------------------------------------------------
Total revenue 634,543 607,336 1,267,417 1,212,912
EXPENSES
Property operations and maintenance 113,937 103,504 240,648 227,991
Depreciation and amortization 129,985 125,187 259,970 250,376
General and administrative 198,378 184,744 412,235 413,575
Management fees - Affiliate 34,375 30,032 65,835 61,772
----------------------------------------------------
Total expenses 476,675 443,467 978,688 953,714
----------------------------------------------------
Net income $157,868 $163,869 $288,729 $259,198
====================================================
Net income allocated to general partners $ 15,787 $16,387 $28,873 $ 25,920
====================================================
Net income allocated to limited partners $142,081 $147,482 $259,856 $233,278
====================================================
Net income allocated to limited
partners per limited partnership unit
outstanding $ 3.77 $ 3.91 $ 6.89 $ 6.18
====================================================
Limited partnership units outstanding 37,732 37,732 37,732 37,732
====================================================
</TABLE>
See accompanying note.
3
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Chrisken Partners Cash Income Fund L.P.
(A Delaware Limited Partnership)
Consolidated Statement of Partners' Capital
Six months ended June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
PARTNER CAPITAL ACCOUNTS
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GENERAL LIMITED
PARTNERS PARTNERS TOTAL
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<S> <C> <C> <C>
Balance at January 1, 1996 $268,796 $12,954,764 $13,223,560
Distributions (A) - (378,240) (378,240)
Net income 28,873 259,856 288,729
Redeemed limited partnership units at cost - (48,630) (48,630)
----------------------------------------
Balance at June 30, 1996 $297,669 $12,787,750 $13,085,419
========================================
</TABLE>
(A) Summary of 1996 quarterly cash distributions paid per limited partnership
unit:
<TABLE>
<S> <C>
First quarter $5.04
Second quarter 4.98
</TABLE>
See accompanying note.
4
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Chrisken Partners Cash Income Fund L.P.
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30
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1996 1995
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $288,729 $259,198
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 259,970 250,376
Bad debt expense - 15,446
Net changes in operating assets and liabilities:
Increase in accounts receivable (3,395) (17,057)
(Increase) decrease in prepaid expenses 19,286 (16,528)
Decrease in accounts payable and accrued expenses (107,990) (175,698)
Increase in deferred income and prepaid rent 9,668 (8,896)
Increase in tenants' security deposits 3,174 3,776
Decrease in due to affiliates - (3,917)
---------------------
Net cash provided by operating activities 469,442 306,700
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (133,407) (277,917)
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Cash used in investing activities (133,407) (277,917)
CASH FLOWS FROM FINANCING ACTIVITIES
Redeemed limited partnership units at cost (48,630) -
Distributions to partners (378,240) (329,153)
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Cash used in financing activities (426,870) (329,153)
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Net decrease in cash and cash equivalents (90,835) (300,370)
Cash and cash equivalents, beginning of period 663,387 832,475
---------------------
Cash and equivalents, end of period $572,552 $532,105
=====================
</TABLE>
See accompanying note.
5
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Chrisken Partners Cash Income Fund L.P.
(A Delaware Limited Partnership)
Note to Consolidated Financial Statements
1. INTERIM ACCOUNTING POLICIES
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and 310(b) of
Regulation of S-B. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. The consolidated financial statements are the
representation of the General Partners and reflect all adjustments which are,
in the opinion of the General Partners, necessary for a fair presentation of
the financial position and results of operations of the Partnership. The
General Partners believe that all such adjustments are normal and recurring.
For further information, refer to the consolidated financial statements and
notes thereto included in the Partnership's Annual Report on Form 10-KSB for
the year ended December 31, 1995.
6
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Chrisken Partners Cash Income Fund L.P. (CPCIF or the Partnership) is
a Delaware limited partnership organized on May 4, 1987, with Chrisken Income
Properties, Inc. (Managing General Partner) and Chrisken Limited Partnership I
as General Partners. Pursuant to a public offering (the Offering), CPCIF sold
37,732 limited partnership units at $500 for each unit. CPCIF has 99.99%
ownership interests in Springdale Associates Limited Partnership and Chicago I
Self-Storage Limited Partnership. Springdale Associates Limited Partnership
owns a 199-unit residential complex located in Waukesha, Wisconsin (Springdale
Apartments), and Chicago I Self-Storage Limited Partnership owns a 155,997
square foot self- storage facility located in Chicago, Illinois (Gold Coast
Storage).
Liquidity and Capital Resources
The Partnership had cash and cash equivalents of $572,552 and $663,387
as of June 30, 1996 and December 31, 1995, respectively. The reduction in cash
and cash equivalents is primarily due to capital improvement expenditures,
reductions in accounts payable, and the of limited partner units as discussed
below. Restricted cash represents operating and contingency reserves
(Reserve) equal to approximately 2% of the gross proceeds of the Offering
($377,320 at June 30, 1996 and December 31, 1995) as required by the Limited
Partnership Agreement. The Reserve is available for unanticipated
contingencies and repairs at Springdale Apartments and Gold Coast Storage
(collectively the "Specified Properties"). The General Partners believe the
current amount of the Reserve is adequate to satisfy cash requirement needs.
On March 4, 1996, Equity Resource Fund XVIII (Fund XVIII), which is
not affiliated with the Partnership or its General Partners, submitted an
unsolicited offer to the Partnership's limited partners to purchase up to 1800
Units of the Partnership. As of the close of the Fund XVIII offer period,
April 4, 1996, the Partnership's records indicate that 317.0863 Units were sold
by limited partners to Fund XVIII. On March 13, 1996 the General Partners
submitted a 30 day offer to the limited partners whereby CPCIF would purchase
up to 1800 Units of the Partnership. As the result of the CPCIF offer, the
Partnership purchased 422.8684 Units from limited partners as of June 30, 1996.
During the six months ended June 30, 1996, 37,732 Units were outstanding.
However, the Units acquired by the Partnership were retired, leaving
37,309.1316 Units outstanding at June 30, 1996. The cost of the Units
purchased by CPCIF was $48,629.87. Management believes that neither the Unit
sales to Fund XVIII nor the Unit purchases by CPCIF adversely affect the
management or liquidity of the Partnership.
Results of Operations
Occupancy at the Springdale Apartments was 94% at June 30, 1996, 96%
at December 31, 1995, and 95% at June 30, 1995. While occupancy of the units
remained relatively stable, rental rates have moderately increased.
Occupancy at Gold Coast Storage was 85% at June 30, 1996, 81% at
December 31, 1995, and 82% at March 31, 1995.
Management continues to aggressively market both apartment units at
Springdale Apartments and lease space at Gold Coast Storage in order to
increase occupancy percentages, and rental rates, at both locations.
Management anticipates occupancy at both Properties to remain stable at the
current levels during the remainder of 1996.
7
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Rental and other revenue of $776,975 for Springdale Apartments for the
six months ended June 30, 1996 decreased slightly from rental revenue and other
revenue of $779,597 for the six months ended June 30, 1995. The decrease in
rental revenue resulted from an increase in rental rates of approximately 1%,
offset by a increase in vacancy loss, higher employee unit benefits and model
unit loss in 1996. The General Partners anticipate that rental revenues will
remain at this level through out the remainder of 1996 with an overall increase
in rental rates for the year. Rental and other revenue at Gold Coast Storage
increased by approximately 13% from $417,160 for the six months ended June 30,
1995 to $472,357 for the six months ended June 30, 1996 primarily due to an
increase in rental rates of approximately 9%, a reduction in vacancy loss and
increased sundry income. The General Partners believe that rental revenue at
Gold Coast Storage will remain relatively stable over the next few years.
Overall rental and other revenue for the six months ended June 30, 1996 of
$1,249,332 increased by 4% from the six months ended June 30, 1995 of
$1,196,757 due to the factors detailed above.
Expenses for the six months ended June 30, 1996, attributable to
Springdale Apartments of $547,503 were approximately 4% higher than expenses
for the six months ended June 30, 1995 of $527,785 due primarily to increased
property operating and maintenance, and depreciation and amortization expenses,
with stable general and administrative expenses. Property operating and
maintenance expenses are higher due to higher carpet replacement expenses,
higher general maintenance, and higher painting and decorating costs due to
higher vacancy during the current six months. The above increases are
partially offset by lower utility costs, specifically heating fuels.
Depreciation expense is higher in 1996 as compared to 1995 due to capital
expenditures in 1995. General and administrative expenses for the six months
ended June 30, 1996 are comparable to the same period one year earlier although
real estate taxes are lower as the result of a successful assessment valuation
appeal which benefits the current period, offset by higher office staff and
related employer costs due to the higher vacancy which calls for extended
office hours for marketing purposes. Expenses attributable to Gold Coast
Storage for the six months ended June 30, 1996 of $368,507 increased slightly
from the six months ended June 30, 1995 of $367,736 with lower property
operations and maintenance, and general and administrative expenses, offset by
higher depreciation and management fee expense. Property operating and
maintenance expenses are lower in 1996 as compared to 1995 primarily due to
lower dock attendant/elevator operator payroll costs, and boiler system repair
costs incurred in the first quarter of 1995 which were not incurred in the
current period, offset by higher electricity costs due to an erroneous meter
reading in the fourth quarter of 1995, higher occupancy, and an unseasonably
cold 1996 spring; heating fuel costs are also higher during the current period
due to the unseasonably cold spring. Depreciation expense is higher in 1996 as
compared to 1995 due to capital expenditures in 1995. General and
administrative expenses are lower in 1996 as compared to 1995 primarily due to
lower office staff payroll and related employer costs, property insurance
costs, and real estate taxes due to a successful real estate tax assessment
appeal, offset by higher advertising expenditures. Management fee expense is
higher in the current period due to increased revenue. Overall expenses for
the six months ended June 30, 1996 of $916,010 increased by approximately 2%
from the six months ended June 30, 1995 of $895,521 primarily as a result of a
combination of the factors described above. Management anticipates that, in
aggregate, expenses in 1996 will be similar to those experienced in 1995.
Net income for the six months ended June 30, 1996 of $229,472 from
Springdale Apartments decreased by approximately 10% from the six months
8
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ended June 30, 1995 of $251,812 due primarily to decreased rental revenue and
increased property operating and maintenance, and depreciation expenses. Net
income for the six months ended June 30, 1996 of $103,850 from Gold Coast
Storage increased significantly as compared to net income for the six months
ended June 30, 1995 of $49,424 due to increased rental revenue, decreased
property operating and maintenance and general and administrative expenses
offset by higher depreciation and management fee expense.
Interest income earned by the Partnership for the six months ended
June 30, 1996 of $18,085 increased by approximately 12% from the six months
ended one year earlier of $16,155 primarily due to higher interest rates.
Administrative expenses incurred by the Partnership for the six months ended
June 30, 1996 of $62,677 increased by approximately 8% from the six months
ended one year earlier of $58,193 as the result of reduced third party
accounting and audit fees offset by higher investor communication expenses due
to the aforementioned Equity Resource Fund XVIII and CPCIF Unit purchase
offers.
Overall net income for the six months ended June 30, 1996 of $288,729
increased by approximately 18% from the six months ended June 30, 1995 of
$259,198 due to decreased rental revenue at Springdale Apartments and increased
rental revenue at Gold Coast Storage offset by slightly higher overall
expenses and by higher Partnership administrative expenses.
Net cash provided by operations for the six months ended June 30, 1996
was $469,442 compared to net cash provided by operations of $306,700 for the
six months ended June 30, 1995. The change was primarily the result of
increased net income during the six months ended June 30, 1996, an increase in
deferred income and prepaid rent, a decrease in prepaid expenses, offset by a
decrease in accounts payable and accrued expenses, and an increase in accounts
receivable. Capital expenditures at both Properties decreased to $133,407 for
the six months ended June, 30, 1996 compared to $277,917 for the same period
one year ago. Capital expenditures at Springdale Apartments included
completion of the exterior siding replacement project which commenced in 1995,
and the replacement of dated and worn appliances. There were no capital
expenditures at Gold Coast Storage during the first six months of 1996.
Distributions to Limited Partners during the six months ended June 30, 1996
totalled $378,240 compared to distributions of $329,153 during the six months
ended June 30, 1995. The General Partners anticipate that distributions to
Limited Partners will remain relatively stable throughout 1996, provided that
revenues and expenses also remain stable.
"Safe Harbor" statement under the U.S. Private Securities Litigation
Reform Act of 1995: Some statements in this Form 10-Q are forward looking and
actual results may differ materially from those stated. As discussed herein,
among the factors that may affect actual results are changes in rental rates,
occupancy levels in the market place in which the Springdale Apartments and
Gold Coast Storage compete and/or unanticipated changes in expenses or capital
expenditures.
9
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CHRISKEN PARTNERS CASH INCOME FUND L.P.
(A DELAWARE LIMITED PARTNERSHIP)
Items 1 through 5 are omitted because of the absence of conditions
under which they are required.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) No exhibits are being filed with this Report.
10
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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 thereto duly authorized.
Chrisken Partners Cash Income Fund L.P.
---------------------------------------
(Registrant)
By: Chrisken Income Properties
Inc., Managing General
Partner
Date: August 8, 1996 By: /s/John F. Kennedy
-------------------------
John F. Kennedy
Director and President
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 949,872
<SECURITIES> 0
<RECEIVABLES> 15,829
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 976,158
<PP&E> 16,490,004
<DEPRECIATION> 3,942,638
<TOTAL-ASSETS> 13,523,524
<CURRENT-LIABILITIES> 438,105
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 13,085,419
<TOTAL-LIABILITY-AND-EQUITY> 13,523,524
<SALES> 1,173,072
<TOTAL-REVENUES> 1,267,418
<CGS> 0
<TOTAL-COSTS> 978,688
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 288,729
<INCOME-TAX> 0
<INCOME-CONTINUING> 288,729
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 288,729
<EPS-PRIMARY> 6.89
<EPS-DILUTED> 6.89
</TABLE>
