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CHRISKEN PARTNERS CASH INCOME FUND L P
10QSB, 1999-11-15
REAL ESTATE

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 10-QSB

/x/	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 1999

/ /	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                to                

Commission File Number 0-17602

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ChrisKen Partners Cash Income Fund L.P.
(Exact name of small business issuer as specified in its
certificate of Limited Partnership)

Delaware (State or other jurisdiction of incorporation or organization)		36-3521124 (I.R.S. Employer Identification Number)
345 North Canal Street, Chicago, Illinois (Address of principal executive offices)		60606 (Zip Code)

(312) 454-1626
(Issuer's telephone number)

(Former name, former address and former fiscal year, if changed since last report)

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    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

				Page
PART I		Financial Information
Item 1.		Consolidated Financial Statements (Unaudited)
		Consolidated Balance Sheet at September 30, 1999		2
		Consolidated Statements of Income for the Nine Months Ended September 30, 1999 and 1998		3
		Consolidated Statement of Partners' Capital for the Nine Months Ended September 30, 1999		4
		Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 1999 and 1998		5
		Notes to Consolidated Financial Statements		6
Item 2.		Management's Discussion and Analysis or Plan of Operation		8
PART II.		Other Information
Item 1.		Legal Proceedings		12
Item 2.		Changes in Securities		12
Item 3.		Defaults Upon Senior Securities		12
Item 4.		Submissions of Matters to a Vote of Security Holders		12
Item 5.		Other Information		12
Item 6.		Exhibits and Reports on Form 8-K		12
SIGNATURE				13

Chrisken Partners Cash Income Fund L.P.

(A Delaware Limited Partnership)

Consolidated Balance Sheet

September 30, 1999

(Unaudited)

Assets
Cash and cash equivalents		$	890,693
Restricted cash			377,320
Accounts receivable			61,963
Prepaid expenses and other assets			20,187
			1,350,163
Investment in real estate, at cost:
Land			2,253,724
Buildings and improvements			10,847,917
Personal property			337,364
			13,439,005
Accumulated depreciation			(2,444,182	)
			10,944,823
Total assets		$	12,344,986
Liabilities and partners' capital
Accounts payable		$	39,948
Tenants' security deposits			88,131
Deferred income and prepaid rent			91,615
Accrued real estate taxes			294,444
Total liabilities			514,138
Partners' capital, 36,948 limited partnership units issued and outstanding			11,830,848
Total liabilities and partners' capital		$	12,344,986

See accompanying notes.

Chrisken Partners Cash Income Fund L.P.

(A Delaware Limited Partnership)

Consolidated Statements of Income

(Unaudited)

		Three Months Ended September 30						Nine Months Ended September 30
		1999			1998			1999			1998
Revenue
Rental		$	690,154		$	661,165		$	2,059,902		$	1,941,979
Interest			10,549			10,476			32,712			32,447
Other			44,943			48,968			110,530			126,881
Total revenue			745,646			720,609			2,203,144			2,101,307
Expenses
Property operations			113,436			134,544			378,270			427,292
Depreciation			132,443			50,297			397,329			150,891
General and administrative			204,788			218,322			580,036			682,062
Management fees—affiliate			36,908			34,221			114,145			108,467
Total expenses			487,575			437,384			1,469,780			1,368,712
Net income		$	258,071		$	283,225		$	733,364		$	732,595
Net income allocated to general partners		$	25,807		$	28,323		$	73,336		$	73,260
Net income allocated to limited partners		$	232,264		$	254,902		$	660,028		$	659,335
Net income allocated to limited partners per limited partnership unit outstanding		$	6.29		$	6.90		$	17.86		$	17.85
Limited partnership units outstanding			36,948			36,948			36,948			36,948

See accompanying notes.

    

Chrisken Partners Cash Income Fund L.P.

(A Delaware Limited Partnership)

Consolidated Statement of Partners' Capital

Nine months ended September 30, 1999

(Unaudited)

		Partners' Capital Accounts
		General Partners			Limited Partners			Total
Balance at January 1, 1999		$	428,255		$	11,470,886		$	11,899,141
Distributions (A)			—			(801,657	)		(801,657	)
Net income			73,336			660,028			733,364
Balance at September 30, 1999		$	501,591		$	11,329,257		$	11,830,848

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(A)

Summary of 1999 quarterly cash distributions paid per limited partnership unit:

First quarter		$	7.57
Second quarter		$	6.30
Third quarter		$	7.82

See accompanying notes.

Chrisken Partners Cash Income Fund L.P.

(A Delaware Limited Partnership)

Consolidated Statements of Cash Flows

(Unaudited)

		Nine Months Ended September 30
		1999			1998
Cash flows from operating activities
Net income		$	733,364		$	732,595
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation			397,329			150,891
Net changes in operating assets and liabilities:
(Increase) decrease in accounts receivable			(23,311	)		6,396
(Increase) decrease in other assets			(17,596	)		18,369
Decrease in accounts payable and accrued expenses			(78,577	)		(82,212	)
(Decrease) increase in deferred income and prepaid rent			(3,106	)		1,744
(Decrease) increase in tenants' security deposits			(3,827	)		10,669
Net cash flows provided by operating activities			1,004,276			838,452
Cash flows from investing activities
Additions to investment in real estate			(104,742	)		(38,612	)
Cash flows used in investing activities			(104,742	)		(38,612	)
Cash flows from financing activities
Distributions			(801,657	)		(725,209	)
Cash flows used in financing activities			(801,657	)		(725,209	)
Net decrease in cash and cash equivalents			97,877			74,631
Cash and cash equivalents, beginning of period			792,816			594,370
Cash and cash equivalents, end of period		$	890,693		$	669,001

See accompanying notes.

    

Chrisken Partners Cash Income Fund L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements

(Unaudited)

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 Regulations 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 Chrisken Partners Cash Income Fund L.P.'s (the "Partnership") Annual Report on Form 10-KSB for the year ended December 31, 1998.

2. Segment Information

		Three Months Ended
		September 30, 1999						September 30, 1998
		Residential Apartment Complex			Self Storage Facility			Residential Apartment Complex			Self Storage Facility
Property operating revenues		$	418,427		$	318,184		$	390,697		$	320,126
Operating income			144,753			106,053			175,213			105,199
Total assets			6,515,129			4,764,419			6,892,451			5,053,499

		Nine Months Ended
		September 30, 1999						September 30, 1998
		Residential Apartment Complex			Self Storage Facility			Residential Apartment Complex			Self Storage Facility
Property operating revenues		$	1,263,996		$	915,383		$	1,155,075		$	914,475
Operating income			460,820			292,768			472,650			276,034

Chrisken Partners Cash Income Fund L.P.

(A Delaware Limited Partnership)

Notes to Consolidated Financial Statements (continued)

(Unaudited)

2. Segment Information (continued)

    A reconciliation of combined operating income for the residential apartment complex segment and the self storage facility segment to net income is as follows:

		Three Months Ended September 30						Nine Months Ended September 30
		1999			1998			1999			1998
Total operating income for reportable segments		$	250,806		$	280,412		$	793,588		$	748,684
General and administrative expense			(1,770	)		(6,973	)		(43,990	)		(47,846	)
Interest income			9,035			9,793			23,766			31,757
Net income		$	258,071		$	283,225		$	773,364		$	732,595

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. 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 $890,693 and $792,816 as of September 30, 1999, and December 31, 1998, respectively. The increase in cash and cash equivalents is primarily due to an increase in net operating income before depreciation expense offset by an increase in accounts receivable and other assets, reductions in accounts payable and accrued liabilities, and additions to investment in real estate. Restricted cash represents operating and contingency reserves (the "Reserve") equal to approximately 2% of the gross proceeds of the Offering ($377,320 at September 30, 1999, and December 31, 1998) 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 Reserve amount is adequate to satisfy cash requirement needs. The Partnership holds the Specified Properties described above on an unencumbered or all cash basis.

    For Springdale Apartments management anticipates the following major repairs or improvements to the property to be completed during the remainder of 1999: apartment entry door replacement ($14,000), and continued carpet ($10,000) and appliance replacement ($8,000) as needed due to obsolescence. For Gold Coast Storage management anticipates the following major repairs or improvements to the property to be completed during the remainder of 1999: elevator repairs ($10,000), roof and exterior brick repairs ($5,000). These expenditures will be funded from operating cash flow.

    In October 1999, Bond Purchase, L.L.C., 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 4.9%, or approximately 1,800, of the outstanding Limited Partnership Units of the Partnership at $271 per Unit. The Partnership's records indicate that as of November 11, 1999, 130 Units were sold by Limited Partners to Bond Purchase, L.L.C. The Bond Purchase, L.L.C. offer expires on November 15, 1999. On October 26, 1999, the General Partners submitted an offer, with an expiration date of November 26, 1999, to the Limited Partners whereby the Partnership, its General Partners and certain affiliates, would purchase up to 4.9% of the outstanding Units of the Partnership at $285 per Unit. As a result of the Partnership's offer, its records indicate that 189 Units, or $53,865 in aggregate, were sold in response to the Partnership's offer. It is the Partnership's intention to purchase all units tendered by Limited Partners pending the number of Units tendered and the liquidity of the Partnership. Management believes that the Unit sales to Bond Purchase, L.L.C., or purchases of Units by the Partnership will not adversely affect the management or liquidity of the Partnership.

Results of Operations

    Occupancy at the Springdale Apartments was 96% at September 30, 1999, 97% at December 31, 1998, and 97% at September 30, 1998. Rental revenue increased during the nine months ended September 30, 1999, as compared to the same period one year earlier primarily due to a moderate increase in rental rates and a significant reduction in rent concessions and vacancy loss. The General Partners believe that occupancy at Springdale Apartments will remain between 95 - 98% for the remainder of 1999.

    Occupancy at Gold Coast Storage was 89% at September 30, 1999, 88% at December 31, 1998, and 87% at September 30, 1998. Rental revenue increased during the nine months ended September 30, 1999, as compared to the same period one year earlier, primarily due to a 2.5% net effective increase in rental rates. The General Partners believe that, due to increased competition, occupancy at Gold Coast will remain between 86 - 91% for the remainder of 1999.

    Management continues to aggressively market both the apartment units at Springdale Apartments and space at Gold Coast Storage in order to improve occupancy percentages and increase rental rates at both locations. Management anticipates that occupancy at both Properties will remain at present levels during the remainder of 1999.

    Rental and other revenue of $1,263,996 for Springdale Apartments for the nine months ended September 30, 1999, increased 9.4% from rental revenue of $1,155,075 for the nine months ended September 30, 1998. The increase in rental revenue primarily resulted from moderately increased rental rates and a significant reduction in rent concessions and vacancy loss. Rental and other revenue at Gold Coast Storage of $915,383 for the nine months ended September 30, 1999 is comparable to revenue of $914,475 for the nine months ended September 30, 1998, as the result of a net increase in rental rates of approximately 2.5% partially offset by a reduction in sundry income. During 1999 Gold Coast has experienced an increase in local competition which has resulted in higher than anticipated vacancy. 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 of the Specified Properties for the nine months ended September 30, 1999, of $2,179,378 increased by 5.3% from the nine months ended September 30, 1998, from $2,069,550 due to the factors detailed above affecting the Specified Properties.

    Expenses for the nine months ended September 30, 1999, attributable to Springdale Apartments of $803,176 were approximately 17.7% higher than expenses for the nine months ended September 30, 1998, of $682,425, due primarily to the reinstatement of depreciation expense, partially offset by lower property operating and maintenance, and general and administrative expenses. Before depreciation expense, the Springdale Apartments had total expenses of $556,919 for the nine months ended September 30, 1999, compared to $682,425 for the nine months ended September 30, 1998. In the latter part of 1997, Springdale Apartments was reclassified to "Assets Held for Sale" which resulted in the suspension of the recognition of depreciation expense pursuant to Statement of Financial Accounting Standards No. 121(SFAS 121) "Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of". However, negotiations with a potential buyer of the property were terminated June 1, 1998. Also pursuant to SFAS 121, the Property was reclassified as "Held for Investment" and depreciation expense was resumed. Property operating and maintenance expenses were lower primarily due to the resumption of treating heating, air conditioning, appliance, and carpet replacement, as well as certain electrical and grounds expenses as additions to investment in real estate. During the majority of the first six months of 1998 this type of expenditure was treated as current period costs as set forth in SFAS 121. Property operating expenses also decreased due to lower painting and decorating, security, plumbing supplies and repairs and water and sewer expenses, partially offset by increased swimming pool supplies and repairs, janitorial, maintenance, heating fuel and heating system repair costs. Water and sewer expenses for the first nine months of 1999 are lower than water and sewer expenses for the first nine months of 1998, on an accrual basis, due to understated fourth quarter 1997 accrual estimates which resulted in higher expenses in 1998. Heating fuel costs are higher in the first nine months of 1999 in comparison to the same period for 1998, on an accrual basis, due to overstated fourth quarter 1997 accrual estimates which resulted in lower expenses in 1998. General and administrative expenses are lower for the period ended September 30, 1999, as compared to the same period one year earlier due primarily to legal fees and property disposition costs incurred in 1998 for which there are no comparable expenses in 1999. General and administrative expenses are also lower due to decreased marketing and administrative expenses, partially offset by higher real estate taxes and communications service expense. Administrative salaries are higher due to increased salary levels. Management fee expense is higher due to increased revenue.

    Expenses attributable to Gold Coast Storage for the nine months ended September 30, 1999, of $622,613 are 2.5% lower compared to expenses for the nine months ended September 30, 1998, of $638,440. Property operating and maintenance expenses are slightly lower in 1999 as compared to the first nine months of 1998 due to lower maintenance payroll, heating fuel costs and structural repair offset by increased security, janitorial, grounds, elevator maintenance, electrical supplies and repairs and heating and ventilation system supplies and repairs. Grounds maintenance expense increased primarily due to higher snow plowing costs resulting from heavy snow fall in early 1999. Depreciation expense is comparable for both periods. General and administrative expenses during the first nine months of 1999 are 4.7% lower compared to 1998 due to decreased bad debt and data processing expenses, partially offset by increased marketing, administrative salaries, legal fees, communications service expense. Management fee expense for 1999 is comparable to 1998.

    Overall expenses incurred by the Specified Properties for the nine months ended September 30, 1999, of $1,425,790 increased approximately 7.9% from the nine months ended September 30, 1998, of $1,320,865 primarily as a result of a combination of the foregoing factors affecting the Specified Properties. Management anticipates that, in aggregate, expenses in 1999 will be higher by a similar percentage as compared to those experienced in 1998. The reinstatement of depreciation expense, as discussed above, will result in increased expenses in 1999 as compared to 1998.

    Net income for the nine months ended September 30, 1999, of $460,820 from Springdale Apartments decreased from the nine months ended September 30, 1998, of $472,650 due primarily to increased rental revenue and decreased property operating and maintenance and general and administrative expenses, offset by the reinstatement of depreciation expense. Net income for the nine months ended September 30, 1999, of $292,768 from Gold Coast Storage increased 6% as compared to net income for the nine months ended September 30, 1998, of $276,034 due to slightly increased rental revenue and decreased general and administrative, and property operating and maintenance expenses.

    Interest income earned by the Partnership for the nine months ended September 30, 1999, of $23,766 is lower than the $31,757 earned for the nine months ended one year earlier because excess cash was held by Springdale Apartments earning $8,946 in interest. Administrative expenses incurred by the Partnership for the nine months ended September 30, 1999, of $43,990 are lower as compared to one year earlier expenses of $47,846 primarily due to a timing difference in the payment of accounting and tax service fees.

    Overall net income for the nine months ended September 30, 1999, of $733,364 increased from the nine months ended September 30, 1998, of $732,595 due to increased rental revenue and offset by increased expenses, primarily depreciation expense, at the Specified Properties.

    Net cash flows provided by operations for the nine months ended September 30, 1999, was $1,004,276 compared to net cash flows provided by operations of $838,452 for the nine months ended September 30, 1998. The change was primarily due to an increase in net operating income before depreciation expense offset by an increase in accounts receivable and other assets, reductions in accounts payable and accrued liabilities. Additions to investment in real estate at the Specified Properties increased to $104,742 for the nine months ended September 30, 1999, compared to $38,612 for the same period one year ago. Additions to investment in real estate at Gold Coast included office equipment and heating and ventilating system improvements. As discussed above, Statement of Financial Accounting Standards No. 121 requires that all expenditures be immediately expensed if a property is held for sale, therefore there were no additions to investment in real estate during the first half of 1998 at Springdale Apartments. Additions to investment in real estate at Springdale Apartments during 1999 primarily consisted of carpet and appliance replacement. Distributions to Limited Partners during the nine months ended September 30, 1999, totaled $801,657 compared to distributions of $725,209 during the nine months ended September 30, 1998. The General Partners anticipate that distributions to Limited Partners will remain at the current level for the remainder of 1999, provided that revenues and expenses also remain stable during the remainder of the year.

Year 2000 Readiness.

    Information provided within this note constitutes a year 2000 readiness disclosure pursuant to the provisions of the Year 2000 Information Readiness and Disclosure Act.

    The Year 2000 issue is the result of computer programs being written and microchips being programmed using two digits rather than four to define the applicable year. If not corrected, any program having time-sensitive software or equipment incorporating embedded microchips may recognize a date using "00" as the year 1900 rather than the year 2000 or may not recognize the year 2000 as a leap year. This could result in a variety of problems including miscalculations, loss of data and failure of entire systems. Critical areas that could be affected are accounts receivable, accounts payable, general ledger, cash management, computer hardware, telecommunications and property operating systems.

    The Partnership receives certain ancillary and management services from ChrisKen Management. The services provided include all of the Partnership's critical functions that utilize software that may have time-sensitive applications. ChrisKen Management has completed testing all mission critical software. ChrisKen Management has obtained documentation related to year 2000 readiness from its banking and other outside vendors. In addition, ChrisKen Management has developed a methodology to determine that all property operating mission critical systems are year 2000 ready. The evaluation, testing and remediation activities related to property operating systems are completed. Costs relating to ChrisKen Management's systems are the responsibility of ChrisKen Management; therefore, the Partnership will incur no costs relating to these systems. Costs relating to property level systems and equipment will be charged to the Property.

    ChrisKen Management expects to complete a contingency plan by November 30, 1999. ChrisKen Management believes that based on the status of the Partnership's real estate portfolio and its limited number of transactions, aside from catastrophic failures of banks, governmental agencies, etc., it could carry out substantially all of its critical administrative and accounting operations on a manual basis or easily convert to systems that are year 2000 ready. ChrisKen Management has targeted December 15, 1999, for the completion of contingency plans relating to property operating systems.

    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

PART II

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)

Exhibits.




Exhibit 27, Financial Data Schedule

(b)

Reports on Form 8-K.




No Reports on Form 8-K were filed during the quarter ended September 30, 1999.

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: November 11, 1999		By:	/s/ JOHN F. KENNEDY    John F. Kennedy Director and President

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