FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
(Mark One)
{ X } QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
{ } TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
For Quarter Ended September 30, 1995 Commission file number 000-16698
Brown-Benchmark Properties Limited Partnership
(Exact Name of Registrant as Specified in its Charter)
Delaware 31-1209608
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
225 East Redwood Street, Baltimore, Maryland 21202
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (410) 727-4083
N/A
(Former Name, Former Address, and Former Fiscal Year,
if Changed Since Last Report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
INDEX
Page No.
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets 1
Statements of Operations 2
Statements of Partners' Capital 3
Statements of Cash Flows 4
Notes to Financial Statements 5-6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-8
Part II. Other Information
Item 1. through Item 6. 9
Signatures 10
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Consolidated Balance Sheets
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
Assets
<S> <C> <C>
Investment in real estate $16,595,851 $ 16,846,034
Cash and cash equivalents 500,249 342,171
Other assets
Accounts receivable, net 68,258 124,435
Prepaid expenses 8,903 15,178
Escrow for real estate taxes 164,943 236,252
Loan fees, less accumulated amortization
of $59,382 and $56,091, respectively 21,801 25,899
Total assets $17,360,005 $ 17,589,969
Liabilities and Partners' Capital
Liabilities
Accounts payable and accrued expenses $ 499,004 $ 453,476
Due to affiliates 9,206 7,609
Tenant security deposits 138,412 137,211
Mortgage loans payable 14,342,742 14,387,506
Total liabilities 14,989,364 14,985,802
Partners' Capital
General Partners (166,193) (161,521)
Assignor Limited Partner
Assignment of Limited Partnership
Interests - $25 stated value per
unit, 500,000 units outstanding 2,621,443 2,850,280
Limited Partnership Interests -
$25 stated value per unit
40 units outstanding (84,709) (84,692)
Subordinated Limited Partners 100 100
Total partners' capital 2,370,641 2,604,167
Total liabilities and partners' capital$17,360,005 $ 17,589,969
See accompanying notes to financial statements
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</TABLE>
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Consolidated Statements of Operations
For the three months ended March 31,
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
Revenues
<S> <C> <C>
Rental income $ 880,203 $ 877,738
Interest income 2,489 3,224
882,692 880,962
Expenses
Compensation and benefits 82,971 76,475
Utilities 90,054 77,831
Property taxes 88,941 83,430
Maintenance and repairs 58,253 31,016
Property management fee 39,575 39,128
Advertising 6,926 7,586
Insurance 7,974 8,538
Other 9,740 6,607
Administrative & professional fees 17,234 23,469
Interest expense 323,385 327,224
Depreciation of property and
equipment 259,506 254,979
Amortization of loan fees 4,098 7,314
988,657 943,597
Net loss $ (105,965) $ (62,635)
Net loss per unit of assignee
limited partnership interest $ (0.21) $ (0.12)
See accompanying notes to financial statements
-2-
</TABLE>
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Consolidated Statements of Partners' Capital
For the Three Months Ended March 31, 1996 and 1995
(Unaudited)
<TABLE>
<CAPTION>
Assignor Limited Partner
Assignment
of Limited Limited Subordinated
General Partnership Partnership Limited
Partners Interest Interest Partners Total
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1995$ (161,521)$ 2,850,280 $ (84,692)$ 100 $2,604,167
Net loss (2,119) (103,837) (8) - (105,965)
Distributions to partners (2,551) (124,999) (10) - (127,561)
Balance at March 31, 1996 $ (166,193)$ 2,621,443 $ (84,709)$ 100 $2,370,640
Balance at December 31, 1994$ (147,045)$ 3,559,548 $ (84,635)$ 100 $3,327,968
Net loss (1,253) (61,377) (5) - (62,635)
Distributions to partners (2,232) (109,375) (9) - (111,616)
Balance at March 31, 1995 $ (150,530)$ 3,388,796 $ (84,649)$ 100 $3,153,717
See accompanying notes to financial statements
-3-
</TABLE>
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Consolidated Statements of Cash Flows
For the Three Months Ended March 31,
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
Cash flows from operating activities
<S> <C> <C>
Net loss $ (105,965) $ (62,635)
Adjustments to reconcile net loss
to net cash provided by operating activities
Depreciation of property and equipment 259,506 254,979
Amortization of loan fees 4,098 7,314
Change in assets and liabilities
Decrease in accounts receivable 56,176 18,073
Decrease in prepaid expenses 6,275 7,038
Decrease in escrow for real estate taxes 71,309 79,159
Increase (decrease) in accounts payable and accrued expenses 45,529 (56,098)
Increase in due to affiliates 1,597 2,135
Increase in tenant security deposits 1,201 3,597
Net cash provided by operating activities 339,726 253,562
Cash flows from investing activities-
additions to investment in real estate (9,323) (19,311)
Cash flows from financing activities
Distributions to partners (127,561) (111,616)
Mortgage loan principal reduction (44,764) (40,924)
Net cash used in financing activities (172,325) (152,540)
Net increase in cash and cash equivalents 158,078 81,711
Cash and cash equivalents
Beginning of period 342,171 338,316
End of period $ 500,249 $ 420,027
</TABLE>
See accompanying notes to financial statements
-4-
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Notes to the Financial Statements
March 31, 1996
(Unaudited)
NOTE 1 - THE FUND AND BASIS OF PREPARATION
The accompanying financial statements of Brown-Benchmark Properties Limited
Partnership (the "Partnership") do not include all of the information and note
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles. The unaudited interim
consolidated financial statements reflect all adjustments which are, in the
opinion of management, necessary to a fair statement of the results for the
interim periods presented. All such adjustments are of a normal recurring
nature. The unaudited interim financial information should be read in
conjunction with the financial statements contained in the 1995 Annual Report.
NOTE 2 - NEW ACCOUNTING PRONOUNCEMENTS
In March 1995, The Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards No. 121 "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of" Statement 121).
Statement 121 provides guidance for recognition and measurement of impairment of
long-lived assets, certain identifiable intangibles and goodwill related both to
assets to be held and used and assets to be disposed of. The Fund adopted
Statement 121 during the first quarter of 1996 and the adoption did not have any
impact on its consolidated financial statements.
NOTE 3 - INVESTMENT IN REAL ESTATE
Investment in real estate is stated at cost, net of accumulated depreciation,
and is summarized as follows:
<TABLE>
<CAPTION>
March 31, 1996 December 31, 1995
<S> <C> <C>
Land $ 1,257,000 $ 1,257,000
Buildings 21,121,284 21,120,535
Furniture, fixtures
and equipment 1,958,931 1,950,358
24,337,215 24,327,893
Less: accumulated depreciation 7,741,364 7,481,859
Total $16,595,851 $16,846,034
</TABLE>
NOTE 4 - CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist solely of cash and money market accounts,
stated at cost, which approximate market value at March 31, 1996 and December
31, 1995.
NOTE 5 - RELATED PARTY TRANSACTIONS
The Administrative General Partner earned $9,206 and $10,015 during the quarters
ended March 31, 1996 and 1995, respectively, for reimbursement of costs
associated with administering the Partnership, including clerical services,
investor communication services, and reports and filings made to regulatory
authorities.
Benchmark Properties, Inc., an affiliate of the Development General Partner, the
managing agent for the properties, earned a management fee of $39,575 and
$39,128 during the quarters ended March 31, 1996 and 1995 respectively.
-5-
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Notes to the Financial Statements
March 31, 1996
(Unaudited)
NOTE 6 - MORTGAGE LOANS PAYABLE
Each of the properties owned by the Partnership are secured as collateral for
the mortgage loans payable outstanding at March 31, 1996 and December 31, 1995.
Effective August 1, 1992, the existing mortgage loans were renewed with the
current lender for a term of 5 years with an interest rate of 9.0%. Monthly
payments are based on a 27-year amortization schedule with a balloon payment due
at the end of the 5-year term.
NOTE 7 - NET LOSS PER UNIT OF ASSIGNED LIMITED PARTNERSHIP INTEREST
Net loss per Unit of assigned limited partnership interest is disclosed on the
Statement of Operations and is based upon average units outstanding of 500,000
during the quarters ended March 31, 1996 and 1995.
-6-
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Management's Discussion and Analysis of Financial
Condition and Results of Operations
Liquidity and Capital Resources
The Partnership's liquidity is largely dependent on its ability to
maintain reasonably high occupancy levels, achieve rental rate increases as the
respective markets allow and to control operating expenses. The Partnership
currently has sufficient liquid assets from its rental revenues to satisfy its
anticipated operating expenditures and debt service obligations.
On February 12, 1996, the Partnership made a cash distribution to its
partners totaling $127,561, representing a 4% return on invested capital. Funds
for this distribution were derived from the operations of the three apartment
properties. Operating cash flow generated during 1995 represented a yield of
approximately 4.2% on invested capital. The 1996 operating budget suggests
operating cash flow should yield approximately 5% on invested capital. While
operations were slightly behind budget for the first quarter of the year, we
expect operating trends will improve during the year. We expect a 4%
distribution rate will be in place throughout 1996 and will review Partnership
reserves with respect to distribution levels at the end of the year.
The Partnership does not anticipate an outlay for any significant
capital improvements or repair costs that might adversely impact its liquidity.
Results of Operations
First quarter revenues generated from the operation of the three
apartment communities were essentially flat when compared to revenues collected
during the first quarter of 1995. While collections increased at the Dayton
community, revenues were down at the Cincinnati property and essentially
unchanged in Columbus. While the gross rent potential for the three communities
increased $44,347 or (4.8%), from $931,798 during the first quarter of 1995 to
$976,145 during the first quarter of 1996, the average aggregate occupancy level
of the properties decreased from 92.4% during the first quarter of 1995 to 89.5%
during the first quarter of 1996. Based upon recent leasing activity as well as
seasonal leasing trends, we expect occupancy levels will increase during the
second quarter and as a result, revenues are expected to increase throughout the
remainder of the year.
First quarter expenses, excluding interest charges, depreciation and
amortization costs, increased $47,588 (13.4%) versus similar expenses incurred
during the first quarter of 1995. This increase resulted primarily from higher
utility and maintenance costs at Deerfield.
Due to only a marginal increase in revenues, coupled with the increase
in expenses (excluding interest charges, depreciation and amortization costs)
through the first quarter as compared to 1995, the net operating income for the
property decreased $45,858 or approximately 9.5%.
Payments of principal and interest on the permanent loans were $368,149
during the first quarter of both 1996 and 1995 and included principal reductions
of $44,764 and 40,924 respectively.
While rental rates at Deerfield, in Cincinnati, Ohio, have increased
approximately 6% from the first quarter of 1995, (from $540 per unit per month
to $572 per unit per month) occupancy levels decreased to 87% during the first
quarter of the year, down from 94% in 1995. As a result, first quarter 1996
revenues decreased $7,700 versus 1995 collections. Leasing activity has
increased since the end of the first quarter and currently the community is 90%
occupied and 92% leased. Operating expenses increased approximately $35,000
versus the first quarter of 1995 primarily as a result of higher utility and
maintenance costs. A major repair of a water line break resulted in an
unbudgeted plumbing repair of $9,300. In addition, water and sewer costs were up
20% versus 1995 due to increased consumption. Plans to install pressure valves
throughout the community which should prevent further water line breaks are
under review.
-7-
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations (continued)
At Oakbrook, in Columbus, Ohio, occupancy levels decreased during the
first quarter, averaging 92%, down 3% from the first quarter 1995 average of
95%. Rental revenues received at the community during the first quarter however
were flat, when compared to the same period in 1995 due to a 2.5% increase in
the average monthly rental rate. Operating expenses were under budget and only
marginally higher than during the first quarter of 1995. The Columbus market
remains strong and Oakbrook's on-site management remains focused on increasing
rental rates on lease renewals as well as new tenants. Since the end of the
first quarter leasing trends have been positive. Occupancy levels at the
community have increased to 95% and we expect operating results will continue to
improve throughout the year.
Occupancy levels at Woodhills, in Dayton, Ohio, averaged 90% during the
first quarter of 1996, up from 88% during the first quarter of 1995. In
addition, rental rates increased 3% from $530 per unit per month to $546 per
unit per month. As a result, first quarter 1996 rental revenues increased
$16,578 when compared to revenues received during the first quarter of 1995.
Operating expenses incurred during the first quarter of the year were up
marginally when compared to last year. There is no new construction or
properties in the pipeline in our immediate rental market and as a result we
expect operating trends will continue to be positive throughout the year.
-8-
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Inapplicable
Item 2. Changes in Securities
Inapplicable
Item 3. Defaults upon Senior Securities
Inapplicable
Item 4. Submission of Matters to a Vote of Security Holders
Inapplicable
Item 5. Other Information
Inapplicable
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits: None.
b) Reports on Form 8-K: None.
-9-
<PAGE>
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, as amended, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
BROWN-BENCHMARK PROPERTIES
LIMITED PARTNERSHIP
DATE: 5/9/96 By: /s/ John M. Prugh
John M. Prugh
President and Director
Brown-Benchmark AGP, Inc.
Administrative General Partner
DATE: 5/9/96 By: /s/ Timothy M. Gisriel
Timothy M. Gisriel
Treasurer
Brown-Benchmark AGP, Inc.
Administrative General Partner
-10-
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
(Replace this text with legend, if applicable)
</LEGEND>
<CIK> 0000818084
<NAME> BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-1-1996
<PERIOD-END> MAR-31-1996
<EXCHANGE-RATE> 1
<CASH> 500,249
<SECURITIES> 0
<RECEIVABLES> 68,258
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 195,647
<PP&E> 16,595,851
<DEPRECIATION> 0
<TOTAL-ASSETS> 17,360,005
<CURRENT-LIABILITIES> 14,989,364
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 17,360,005
<SALES> 0
<TOTAL-REVENUES> 882,692
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 675,272
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 323,385
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (105,965)
<EPS-PRIMARY> 0.000
<EPS-DILUTED> 0.000
</TABLE>
