UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1996
--------------------------------------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to
---------------- -------------------
Commission file 33-15597
------------------------------------------------------
DIVERSIFIED HISTORIC INVESTORS V
- ----------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 23-2479468
- ------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
SUITE 500, 1521 LOCUST STREET, PHILADELPHIA, PA 19102
- ----------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (215) 735-5001
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act: 11,142 Units
UNITS OF LIMITED PARTNERSHIP INTEREST
- ----------------------------------------------------------------------
(Title of Class)
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
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained to the best of registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. [ ]
Aggregate market value of Units held by non-affiliates of the
Registrant: Not Applicable*
* Securities not quoted in any trading market to Registrant's
knowledge.
<PAGE>
PART I
Item 1. Business
a. General Development of Business
Diversified Historic Investors V ("Registrant") is
a limited partnership formed in 1987 under the Pennsylvania Uniform
Limited Partnership Act. As of December 31, 1996, Registrant had
outstanding 11,142 units of limited partnership interest (the
"Units").
Registrant is currently in its operating stage.
It originally owned three properties or interests therein; however, in
October 1996, an interest in one property was sold. It currently owns
two properties or interests therein. See Item 2. Properties, for a
description thereof. For a discussion of the operations of the
Registrant, See Part II. Item 7. Management's Discussion and Analysis
of Financial Condition and Results of Operations.
The following is a summary of significant
transactions involving the Registrant's interests:
In October 1996, a property owned by the
Registrant, Radisson Redick Hotel, was transferred to 1504 Harney
Street Associates ("HSA") a limited partnership in which the
Registrant owns a 99% interest. The property was transferred so that
it would be held by the Registrant in a manner similar to the other
properties held by the Registrant. On October 28, 1996, HSA filed a
reorganization petition pursuant to Chapter 11 of the U.S. Bankruptcy
Code. For a description of the proceedings, see Item 2. Properties.
On October 10, 1996, one of the Registrant's
Ventures, St. Mary's Market Partnership, sold its property to
Residence Inn by Marriott, Inc. The property was sold for $6,270,000.
After payment of the existing first mortgage loan balance of
$4,432,356 and other selling costs, the net proceeds of the sale were
approximately $1,171,000.
b. Financial Information about Industry Segments
The Registrant operates in one industry segment.
c. Narrative Description of the Business
Registrant is in the business of operating,
holding, selling, exchanging and otherwise dealing in and with real
properties containing improvements which are "Certified Historic
Structures," as such term is defined in the Internal Revenue Code (the
"Code"), for use as apartments, offices, hotels and commercial spaces,
or any combination thereof, or low income housing eligible for the
investment tax credit provided by Section 42 of the Code, and such
other uses as the Registrant's general partner may deem appropriate.
Since the Registrant's inception, all the
properties acquired either by the Registrant, or the subsidiary
partnerships in which it has an interest, have been rehabilitated and
certified as Historic Structures and have received the related
Investment Tax Credit. One property has been held for rental
operations and one for hotel operations. At this time it is
anticipated that the properties will continue to be held for these
purposes. At such time as real property values begin to increase, the
Registrant will re-evaluate its investment strategy regarding the
properties.
As of December 31, 1996, Registrant owns two
properties (or interests therein), located in Nebraska (one) and
Pennsylvania (one). The Properties contain 89 hotel rooms, 21
apartment units and approximately 1,650 square feet ("sf") of
commercial space. As of December 31, 1996, 19 of the apartment units
were under lease at monthly rental rates ranging from $400 to $585 and
1,050 sf of commercial space were under lease at an annual rental of
$5.71 per sf. During 1996, the hotel maintained an average nightly
room rate of $92.15 and average occupancy of 73.4%. Rental of the
apartment units and commercial space is not expected to be seasonal.
However, the hotel does experience seasonal changes, with the busiest
months being May and October and the slowest months being January,
July and December. For a further discussion of the Properties, see
Item 2, Properties.
The Registrant is affected by and subject to the
general competitive conditions of the residential, commercial and
hotel real estate industries. As a result of the overbuilding that
occurred in the 1980's, the competition for both residential and
commercial tenants in the local markets where the Registrant's
residential and commercial properties are located is generally strong.
As a result, the Registrant is forced to keep its rent levels
competitively low in order to maintain moderate to high occupancy
levels. The residential property currently owned by the Registrant is
located in a suburb of Philadelphia, Pennsylvania in which there are
several similar historically certified rehabilitated buildings. The
Registrant's main competitors in this market are organizations which
own similar residential buildings. In this area, the apartment market
remains stable and new construction remains virtually nonexistent
although the availability of favorable home financing has placed
pressure on the rental tenant base. The hotel is located in downtown
Omaha, Nebraska and relies heavily on business travelers to the city.
It recently began an aggressive marketing campaign intended to attract
tourists to the hotel by offering weekend packages. The main
competition to the hotel comes from other chain hotels in the area,
especially hotels located closer to the airport.
Registrant has no employees. Registrant's
activities are overseen by Brandywine Construction & Management, Inc.
("BCMI"), a real estate management firm.
d. Financial Information About Foreign and Domestic
Operations and Export Sales.
See Item 8, Financial Statements and Supplementary
Data.
Item 2. Properties
As of the date hereof, Registrant owned two Properties,
or interests therein. A summary description of each property held at
December 31, 1996 is given below.
a. Radisson Redick Hotel is an historically-certified
building located at 1504 Harney Street, Omaha, Nebraska. In December
1987, the Registrant acquired a 100% equity ownership interest in this
property. The property has been rehabilitated as an 89-room hotel.
Additionally, the property has a restaurant with a seating capacity
for 160, 3,500 sf of meeting/banquet space, 1,650 sf of commercial
space, and 45,510 sf of garage space (119 covered spaces). The
acquisition and rehabilitation price of this property was
approximately $9,500,000 ($71 per sf), financed in part by industrial
revenue bonds from the City of Omaha of $6,500,000 (principal balance
at December 31, 1996 of $6,005,000). On February 9, 1995, the
Registrant refinanced the outstanding bonds which lowered the interest
rate from 7.75% to a variable rate, giving due regard to prevailing
financial market conditions, but in no event shall the variable rate
exceed 7.75% (average interest rate of 4.59% for the year ended
December 31, 1996). Payments of interest only are due on the bonds
monthly beginning March 2, 1995 and the entire principal balance was
due on November 1, 1996. In October 1996, Radisson Redick, was
transferred to 1504 Harney Street Associates ("HSA") a limited
partnership in which the Registrant owns a 99% interest. The property
was transferred so that it would be held by the Registrant in a manner
similar to the other properties held by the Registrant. HSA was
unable to pay the bonds as they became due, and on October 28, 1996,
HSA filed a reorganization petition pursuant to Chapter 11 of the U.S.
Bankruptcy Code. The property is managed by an independent hotel
management firm. Nightly room rates for the hotel range from $52.00
to $122.81, and the annual rental rate for the 1,050 sf of leased
commercial space is $5.71 per sf. Average occupancy was 73.4% in 1996
at an average room rate of $92.15. The occupancy for the previous
four years has been 83.3% for 1995, 71.9% for 1994, 72.6% for 1993 and
70.6% for 1992. The average room rates have been $94.24 for 1995,
$90.84 for 1994, $79.66 for 1993 and $75.36 for 1992. The range for
annual rents for commercial space has been $5.71 for 1995, $5.71 for
1994, $3.60 for 1993 and $6 per sf for 1992. The one tenant who
occupies the commercial space operates principally as a retail store.
For tax purposes, this property has a basis of $9,796,629 and is
depreciated using the straight-line method with a useful life of 31.5
years. The annual real estate taxes are $107,139 which is based on an
assessed value of $3,818,100 taxed at a rate of $2.80608 per $100. It
is the opinion of the management of the Registrant that the property
is adequately covered by insurance.
b. The Lofts at Red Hill is an historically-
certified, four-story former factory located at 350 Main Street, Red
Hill Borough, Pennsylvania. In December 1987, the Registrant acquired
the building and is the 100% equity owner of this property. The
property was rehabilitated as a 21-unit rental residential complex.
The acquisition and rehabilitation price of this property was
approximately $1,350,000 ($81 per sf). The property is managed by
BCMI. As of December 31, 1996, 19 apartment units were under lease
(90%) at monthly rental rates ranging from $400 to $585. All leases
are renewable, one-year leases. The occupancy for the previous four
years was 90% for 1995, 85% for 1994, 81% for 1993 and 76% for 1992.
The monthly rental range has been approximately the same since 1992.
For tax purposes, this property has a basis of $1,359,771 and is
depreciated using the straight-line method with a useful life of 27.5
years. The annual real estate taxes are $14,361 which is based on an
assessed value of $42,700 taxed at a rate of $31.35 per $100. No one
tenant occupies ten percent or more of the building. It is the
opinion of the management of the Registrant that the property is
adequately covered by insurance.
Item 3. Legal Proceedings
a. For a description of legal proceedings involving
Registrant's properties, see Part I, Item 2 and Part II, Item 7.
Item 4. Submission of Matters to a Vote of Security Holders
No matter was submitted during the fiscal years covered
by this report to a vote of security holders.
PART II
Item 5. Market for Registrant's Common Equity and Related
Stockholder Matters
a. There is no established public trading market for
the Units. Registrant does not anticipate any such market will
develop. Trading in the units occurs solely through private
transactions. The Registrant is not aware of the prices at which
trades occur. Registrant's records indicate that 117 units were sold
or exchanged of record in 1996.
b. As of December 31, 1996, there were 1,343 record
holders of Units.
c. Registrant did not declare any cash dividends in
1996 or 1995.
Item 6. Selected Financial Data
The following selected financial data are for the five
years ended December 31, 1996. The data should be read in conjunction
with the consolidated financial statements included elsewhere herein.
This data is not covered by the independent auditors' report.
1996 1995 1994 1993 1992
Rental income $ 767,508 $ 1,205,122 $ 1,162,137 $ 1,093,652 $ 1,004,545
Hotel income 2,387,200 2,548,434 2,442,274 2,307,827 2,343,499
Interest income 7,024 4,576 3,218 8,716 73,686
Net loss (607,725) (712,598) (827,606) (808,627) (1,262,935)
Net loss per Unit (54.00) (63.32) (73.54) (71.85) (112.22)
Total assets (net
of depreciation
and amortization) 9,046,109 13,517,285 14,035,936 14,927,634 15,636,149
Debt obligations 6,163,254 10,436,965 10,366,177 10,322,192 10,342,288
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
(1) Liquidity
As of December 31, 1996, Registrant had cash of
$1,126,711. Such funds are expected to be used to pay liabilities and
general and administrative expenses of Registrant, and to fund cash
deficits of the properties. Cash generated from operations is used
primarily to fund operating expenses and debt service. If cash flow
proves to be insufficient, the Registrant will attempt to negotiate
loan modifications with the various lenders in order to remain current
on all obligations. The Registrant is not aware of any additional
sources of liquidity.
As of December 31, 1996, Registrant had restricted
cash of $8,956 consisting primarily of funds held as security
deposits, replacement reserves and escrows for taxes and insurance.
As a consequence of these restrictions as to use, Registrant does not
deem these funds to be a source of liquidity.
During the first quarter of 1994, approximately
$255,000 of restricted cash held by St. Mary's Market was released of
which $80,000 was paid to the Registrant's co-general partner as a
developer's fee and $175,000 was distributed to the Registrant. These
funds had been held as restricted cash pursuant to the general
partnership agreement of St. Mary's Market General Partnership, which
required that the funds be held until December 31, 1993 and then be
paid to the general partners. The method to be used to determine the
amounts paid to each party was based upon the property's historic
operating results and was described in an ambiguous manner. A dispute
arose between the Registrant and the co-general partner as to the
allocation of these funds, but was ultimately resolved by negotiations
between the parties.
During the second quarter of 1994, the Registrant
utilized cash reserves of $172,349, which had been initially deposited
by the developer, on behalf of the Registrant, to fund shortfalls in
debt service at the Radisson Redick.
(2) Capital Resources
Due to the recent rehabilitations of the
properties, any capital expenditures needed are generally replacement
items and are funded out of cash from operations or replacement
reserves, if any. The Registrant is not aware of any factors which
would cause historical capital expenditure levels not to be indicative
of capital requirements in the future and accordingly, does not
believe that it will have to commit material resources to capital
investment for the foreseeable future.
(3) Results of Operations
During 1996, Registrant incurred a net loss of
$607,725 ($54.00 per limited partnership unit) compared to a net loss
of $712,598 ($63.32 per limited partnership unit) in 1995 and a net
loss of $827,606 ($73.54 per limited partnership unit) in 1994.
Rental and hotel income combined increased from
$3,604,411 in 1994 to $3,753,556 in 1995 and decreased to $3,154,708
in 1996. The decrease from 1995 to 1996 is the result of a decrease
in rental income of $438,000 and a decrease of $161,000 in hotel
income. The decrease in rental income is mainly attributable to an
overall decrease in occupancy at St. Mary's Market due to the sale of
the property and the vacating of units as leases expired in
anticipation of the sale of the property. The decrease in hotel
income is due to a decrease in the average occupancy (83% to 73%) and
a decrease in the average nightly room rate ($94.24 to $92.15) at the
Radisson Redick. The increase from 1994 to 1995 is the result of an
increase of $43,000 in rental income and an increase of $106,000 in
hotel income. The increase in rental income is mainly attributable to
an increase in corporate apartment rentals at St. Mary's Market.
Corporate apartment rentals generate higher revenue than residential
rentals because the leases are generally short term in nature and are
rented at higher monthly rates. Rental income also increased due to
higher average occupancy at the Lofts at Red Hill (85% to 87%). The
increase in hotel income is the result of an increase in average room
rates ($90.84 to $94.24) and an increase in occupancy (71.9% to 83%).
Other income decreased from $172,349 in 1994 to $0
in 1995 and 1996. The decrease from 1994 to 1995 is related to the
utilization of cash reserves, which had been initially deposited by
the developer, on behalf of the Registrant, in the second quarter of
1994, to fund shortfalls in debt service at the Radisson Redick. No
reserves were used in 1995 or 1996.
Expense for rental operations increased from
$736,861 in 1994 to $746,877 in 1995 to decreased to $605,294 in 1996.
The decrease from 1995 to 1996 is due to an overall decrease in
operating expenses at St. Mary's Market, as discussed below and a
decrease in real estate taxes at Lofts at Red Hill due to a reduction
in the assessed value of the property. The expense for 1994 included
a non-recurring payment of an $80,000 developer's fee referred to in
the "liquidity" section above. Excluding such expense, expenses for
rental operations from 1994 to 1995 increased by approximately
$90,000. The increase from 1994 to 1995 is due primarily to increases
in corporate apartments and maintenance expense at St. Mary's Market.
Corporate apartments expense increased corresponding to the increase
in occupancy. Maintenance expense increased due to the recarpeting of
many units at the building and the repair of a deck. Hotel operations
expense increased from $2,005,783 in 1994 and to $2,036,995 in 1995 to
$2,237,857 in 1996 due to an increase in rooms expense, professional
and legal fees and wages and salaries expense as discussed below.
General and administrative expenses decreased from
$234,465 in 1994 to $96,000 in 1995 to $98,859 in 1996. The decrease
from 1994 to 1995 is due to additional administrative fees charged to
the Registrant in the first and second quarters of 1994 relating to
the negotiations at St. Mary's Market described in the "liquidity"
section above.
Interest expense decreased from $906,096 in 1994
to $765,349 in 1995 to $662,031 in 1996. The decrease from 1995 to
1996 is due to the sale of St. Mary's Market in October 1996. The
decrease from 1994 to 1995 is the result of the refinancing of the
bonds at the Radisson Redick which lowered the interest rate from
7.75% to a variable rate which averaged 4.92% in 1995, partially
offset by interest expense incurred relating to the note payable used
to finance the loan costs.
Depreciation and amortization expense increased
from $724,379 in 1994 to $825,509 in 1995 and decreased to $820,712 in
1996. The decrease from 1995 to 1996 is due to the sale of St. Mary's
Market in October 1996 partially offset by the depreciation of
additional personal property purchased in 1996 at Radisson Redick.
The increase from 1994 to 1995 is the result of the amortization of
loan costs incurred in connection with the bond refinancing at
Radisson Redick.
Of the total 1996 loss, a loss of approximately
$501,000 was incurred at the Registrant's three properties compared to
a loss of approximately $603,000 in 1995 and $575,000 in 1994. A
discussion of property operations/activities follows.
In 1996, Registrant incurred a loss of $782,000 at
the Radisson Redick Hotel including $574,000 of depreciation and
amortization expense compared to a loss of $341,000 including $525,000
of depreciation and amortization expense in 1995 and a loss of
$249,000 including $393,000 of depreciation expense in 1994. The
increased loss from 1995 to 1996 is due to a decrease in rooms revenue
and an increase in rooms expense, professional and legal fees, wages
and salaries and depreciation expense. Rooms revenue decreased due to
a decrease in the average occupancy (83% to 73%) and a decrease in the
average nightly room rate ($92.15 to $94.24) resulting from the
opening of a new hotel in the area served by the Registrant and,
accordingly, an increase in competition. Rooms expense increased due
to an increase in commissions expense in an effort to increase
occupancy, professional fees increased due to fees paid to a
consulting firm in an effort to compete with the new hotel, legal fees
increased due to fees incurred in connection with the bankruptcy
filing and wages and salaries increased due to cost of living
increases given to employees. Depreciation expense increased due to
the depreciation of additional personal property purchased in 1996.
The increased loss from 1994 to 1995 is due to a decrease in other
income and an increase in amortization expense partially offset by an
increase in rooms revenue and a decrease in interest. The decrease in
other income is the result of the utilization of cash reserves, which
had been initially deposited by the developer, on behalf of the
Registrant in 1994 to fund shortfalls in debt service. Amortization
increased due to the amortization of loan fees incurred in connection
with the refinancing of the bonds. Rooms revenue increased due to an
increase in average room rates ($90.84 to $94.24) and an increase in
the occupancy (71.9% to 83%). The decrease in interest expense is the
result of a decrease in the interest rate from 7.75% to a variable
rate which averaged approximately 4.92% during 1995, partially offset
by interest expense incurred relating to the note payable used to
finance the loan costs.
In 1996, Registrant recognized income of $319,000
at the St. Mary's Market, including $189,000 of depreciation expense
compared to a loss of $206,000 including $242,000 of depreciation
expense in 1995 and a loss of $268,000 including $255,000 of
depreciation expense in 1994. Included in income in 1996 is a gain of
$586,000 related to the sale of the building. Overall, exclusive of
the gain resulting from the sale of the building, the loss increased
from $206,000 in 1995 to $267,000 in 1996. The increase in the loss
from 1995 to 1996 is due to a decrease in occupancy and an overall
decrease in operating expenses due to the vacating of the units as
leases expired in anticipation of the sale of the property. The
decreased loss from 1994 to 1995 is due to the payment of the
developer's fee of $80,000 in 1994 as described in the "liquidity"
section and an increase in rental income partially offset by an
increase in operating expenses at St. Mary's Market such as corporate
apartments expense and maintenance. The increase in rental income is
mainly attributable to an increase in corporate apartment rentals at
St. Mary's Market. Corporate apartment rentals generate higher
revenue than residential rentals because the leases are generally
short term in nature and are rented at higher monthly rates.
Corporate apartments expense increased corresponding to the increase
in occupancy. Maintenance expense increased due to the recarpeting of
many units at the building and the repair of a deck.
In 1996, Registrant incurred a loss of $38,000 at
the Lofts at Red Hill including $58,000 of depreciation expense
compared to a loss of $56,000 including $58,000 of depreciation
expense in 1995 and a loss of $58,000 including $58,000 of
depreciation expense in 1994. The decrease in the loss from 1996 to
1995 is mainly the result of a decrease in real estate tax expense due
to a reduction in the assessed value of the property. The decrease in
the loss from 1994 to 1995 is the result of an increase in rental
income due to higher average occupancy at the Lofts at Red Hill (85%
to 87%).
Item 8. Financial Statement and Supplementary Data
Registrant is not required to furnish the supplementary
financial information referred to in Item 302 of Regulations S-K.
<PAGE>
Independent Auditor's Report
To the Partners
Diversified Historic Investors V
We have audited the accompanying consolidated balance sheets of
Diversified Historic Investors V (a Pennsylvania Limited Partnership)
and subsidiaries as of December 31, 1996 and 1995 and the related
consolidated statements of operations, changes in partners' equity and
cash flows for the years ended December 31, 1996, 1995 and 1994.
These consolidated financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion
on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the consolidated financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to in
the first paragraph present fairly, in all material respects, the
financial position of Diversified Historic Investors V and
subsidiaries as of December 31, 1996 and 1995, and the results of
their operations and their cash flows for the years ended December 31,
1996, 1995 and 1994 in conformity with generally accepted accounting
principles.
Our audits were made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The Schedule of Real
Estate and Accumulated Depreciation on page 24 is presented for the
purposes of additional analysis and is not a required part of the
basic financial statements and, in our opinion, is fairly stated in
all material respects in relation to the basic financial statements
taken as a whole.
Gross, Kreger & Passio, L.L.C.
Philadelphia, Pennsylvania
February 21, 1997
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULES
Consolidated financial statements: Page
Consolidated Balance Sheets at December 31, 1996 and 1995 12
Consolidated Statements of Operations for the Years Ended
December 31, 1996, 1995 and 1994 13
Consolidated Statements of Changes in Partners' Equity
for the Years Ended December 31, 1996, 1995, and 1994 14
Consolidated Statements of Cash Flows for the Years Ended
December 31, 1996, 1995 and 1994 15
Notes to consolidated financial statements 16-20
Financial statement schedules:
Schedule XI - Real Estate and Accumulated Depreciation 22
Notes to Schedule XI 23
All other schedules are omitted because they are not applicable or the
required information is shown in the consolidated financial statements
or notes thereto.
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
CONSOLIDATED BALANCE SHEETS
December 31, 1996 and 1995
Assets
1996 1995
Rental properties at cost:
Land $ 347,955 $ 1,133,669
Buildings and improvements 10,976,514 17,022,586
Furniture and fixtures 1,158,605 1,351,367
---------- ----------
12,483,074 19,507,622
Less - accumulated depreciation (4,777,178) (6,514,441)
---------- ----------
7,705,896 12,993,181
Cash and cash equivalents 1,126,711 40,854
Restricted cash 8,956 241,236
Accounts and notes receivable 172,869 87,647
Other assets (net of amortization
of $190,812 and $65,610, respectively) 31,677 154,367
---------- ----------
Total $ 9,046,109 $13,517,285
========== ==========
Liabilities and Partners' Equity
Liabilities:
Debt obligations $ 6,163,254 $10,436,965
Accounts payable:
Trade 517,295 328,107
Related parties 130,063 13,426
Taxes 44,084 40,324
Interest payable 158,962 6,877
Accrued liabilities 79,243 73,007
Tenant security deposits 14,510 72,156
---------- ----------
Total liabilities 7,107,411 10,970,862
---------- ----------
Partners' equity 1,938,698 2,546,423
---------- ----------
Total $ 9,046,109 $13,517,285
========== ==========
The accompanying notes are an interal part of these financial statements.
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1996, 1995 and 1994
1996 1995 1994
Revenues:
Rental income $ 767,508 $1,205,122 $1,162,137
Hotel income 2,387,200 2,548,434 2,442,274
Interest income 7,024 4,576 3,218
Gain on sale of property 655,296 0 0
Other income 0 0 172,349
--------- --------- ---------
Total revenues 3,817,028 3,758,132 3,779,978
--------- --------- ---------
Costs and expenses:
Rental operations 605,294 746,877 736,861
Hotel operations 2,237,857 2,036,995 2,005,783
General and administrative 98,859 96,000 234,465
Interest 662,031 765,349 906,096
Depreciation and amortization 820,712 825,509 724,379
--------- --------- ---------
Total costs and expenses 4,424,753 4,470,730 4,607,584
--------- --------- ---------
Net loss ($ 607,725) ($ 712,598) ($ 827,606)
========= ========= =========
Net loss per limited partnership
unit ($ 54.00) ($ 63.32) ($ 73.54)
========= ========= =========
The accompanying notes are an integral part of these financial statements.
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
For the Years Ended December 31, 1996, 1995 and 1994
Dover
Historic Limited
Advisors V (1) Partners (2) Total
Percentage participation in profit
or loss 1% 99% 100%
Balance at December 31, 1993 (128,287) 4,214,914 4,086,627
Net loss (8,276) (819,330) (827,606)
------- --------- ---------
Balance at December 31, 1994 (136,563) 3,395,584 3,259,021
Net loss (7,126) (705,472) (712,598)
------- --------- ---------
Balance at December 31, 1995 (143,689) 2,690,112 2,546,423
Net loss (6,077) (601,648) (607,725)
------- --------- ---------
Balance at December 31, 1996 ($149,766) $2,088,464 $1,938,698
======= ========= =========
(1) General Partner.
(2) 11,142 limited partnership units outstanding at December 31,
1996, 1995, and 1994.
The accompanying notes are an integral part of these financial statements.
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 1996, 1995 and 1994
1996 1995 1994
Cash flows from operating activities:
Net loss ($ 607,725) ($ 712,598)($ 827,606)
Adjustments to reconcile net loss to
net cash provided by (used in)
operating activities:
Depreciation and amortization 820,712 825,509 724,379
Gain on sale (655,296) 0 0
Changes in assets and liabilities:
Decrease in restricted cash 232,280 7,310 170,869
(Increase) decrease in accounts and
notes receivable (85,222) (12,012) 6,430
Decrease (increase) in other assets 1,116,709 (241,543) 56,967
Increase (decrease) in accounts payable
- trade 189,190 113,322 (83,161)
Increase (decrease) in accounts payable
- related parties 143,012 460 (25,640)
Increase (decrease) in accounts payable
- taxes 3,760 (2,773) 899
Increase (decrease) in interest payable 152,085 (31,904) (2)
(Decrease) increase in accrued liabilities (57,646) (17,805) 76,375
Decrease in tenant security deposits (3,667) (2,759) (11,932)
Net cash provided by (used in) --------- --------- -------
operating activities 1,248,192 (74,793) 87,578
--------- -------- -------
Cash flows from investing activities:
Capital expenditures (170,375) (104,401) (72,847)
--------- -------- -------
Net cash used in investing activities (170,375) (104,401) (72,847)
--------- -------- -------
Cash flows from financing activities:
Borrowings under debt obligations 20,939 221,555 0
Repayments of debt financing (12,899) (86,150) (20,632)
Net cash provided by (used in) --------- -------- -------
financing activities 8,040 135,405 (20,632)
--------- -------- -------
Increase (decrease) in cash and cash
equivalents 1,085,857 (43,789) (5,901)
Cash and cash equivalents at beginning
of year 40,854 84,643 90,544
--------- -------- -------
Cash and cash equivalents at end of year $1,126,711 $ 40,854 $ 84,643
========= ======== =======
Supplemental Disclosure of Cash Flow Information
Cash paid during the year for interest $ 509,946 $ 758,473 $905,095
The accompanying notes are an integral part of these financial statements.
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - ORGANIZATION
Diversified Historic Investors V (the "Partnership") is a Pennsylvania
limited partnership formed in July 1987 to acquire, rehabilitate,
renovate, manage, operate, hold, sell, exchange, and otherwise deal in
and with real properties containing improvements which are certified
historic structures, as defined in the Internal Revenue Code (the
"Code"), or which were eligible for designation of such, and to engage
in any and all activities related or incidental thereto. Any
rehabilitations undertaken by the Partnership are done with a view to
obtaining certification of expenditures therefore as "qualified
rehabilitation expenditures" as defined in the Code.
NOTE B - SIGNIFICANT ACCOUNTING POLICIES
A summary of the significant accounting policies consistently applied
in the preparation of the accompanying consolidated financial
statements follows:
1. Principles of Consolidation
The accompanying financial statements include the accounts of the
Partnership and a subsidiary partnership (the "Venture"), in which the
Partnership has a 95% equity interest, with appropriate elimination of
inter-partnership transactions and balances. These financial
statements reflect all adjustments (consisting only of normal
recurring adjustments) which, in the opinion of the General partner,
are necessary for a fair statement of the results for those years.
2. Depreciation
Depreciation is computed using the straight-line method over the
estimated useful lives of the assets. Buildings and improvements are
depreciated over 25 years and furniture and fixtures over five years.
3. Net Loss Per Limited Partnership Unit
The net loss per limited partnership unit is based on the weighted
average number of limited partnership units outstanding (11,142 in
1996, 1995, and 1994).
4. Income Taxes
Income taxes or credits resulting from earnings or losses are payable
by or accrue to the benefit of the partners; accordingly, no provision
has been made for income taxes in these financial statements.
5. Cash and Cash Equivalents
The Partnership considers all highly liquid instruments purchased with
a maturity of less than three months to be cash equivalents.
6. Restricted Cash
Restricted cash includes amounts held for tenant security deposits and
real estate tax reserves.
7. Concentration of Credit Risk
Financial instruments which potentially subject the Partnership to
concentration of credit risk consist principally of cash and cash
equivalents. The Partnership maintains its cash and cash equivalents
in financial institutions insured by the Federal Deposit Insurance
Corporation up to $100,000 per company. At December 31, 1996,
uninsured funds held at one institution approximate $735,000.
8. Other Income
Other income is comprised of the utilization of cash reserves, which
had initially been deposited by the developer, on behalf of the
Partnership, to fund shortfalls in debt service at Radisson Redick.
9. Revenue Recognition
Revenues are recognized when rental payments are due on a straight-
line basis. Rental payments received in advance are deferred until
earned.
10. Deferred Expenses
Loan fees have been incurred with respect to certain loans. Such fees
were deferred and are being amortized over the term of the related
loans.
11. Rental Properties
Rental properties are stated at cost. A provision for impairment of
value is recorded when a decline in value of property is determined to
be other than temporary as a result of one or more of the following:
(1) a property is offered for sale at a price below its current
carrying value, (2) a property has significant balloon payments due
within the foreseeable future for which the Partnership does not have
the resources to meet, and anticipates it will be unable to obtain
replacement financing or debt modification sufficient to allow a
continued hold of the property over a reasonable period of time, (3) a
property has been, and is expected to continue, generating significant
operating deficits and the Partnership is unable or unwilling to
sustain such deficit results of operations, and has been unable to, or
anticipates it will be unable to, obtain debt modification, financing
or refinancing sufficient to allow a continued hold of the property
for a reasonable period of time or, (4) a property's value has
declined based on management's expectations with respect to projected
future operational cash flows and prevailing economic conditions. An
impairment loss is indicated when the undiscounted sum of estimated
future cash flows from an asset, including estimated sales proceeds,
and assuming a reasonable period of ownership up to 5 years, is less
than the carrying amount of the asset. The impairment loss is
measured as the difference between the estimated fair value and the
carrying amount of the asset. In the absence of the above
circumstances, properties and improvements are stated at cost. An
analysis is done on an annual basis at December 31 of each year.
12. New Accounting Pronouncement
Effective January 1, 1995, the Partnership adopted the provisions of
Statement of Financial Accounting Standards ("SFAS") No. 121,
"Accounting for the Impairment of Long - Lived Assets and for Long -
Lived Assets to be Disposed Of." There was no cumulative effect of
the adoption of SFAS No. 121.
NOTE C - PARTNERSHIP AGREEMENT
1. Capital Contributions
The Partnership offered investors limited partnership units at $1,000
per unit; the minimum purchase per investor was three units. A total
of 11,142 limited partnership units were sold. After payment of costs
of issuance as provided for in the Agreement and the withdrawal of the
initial limited partner, initial Partnership capital was $9,722,760
from limited partners and $9,900 from the General Partner.
2. Distributions from Operations
The Agreement provides that, beginning with the date of the admission
of the additional limited partners, all distributable cash from
operations (as defined) will be distributed 99% to the limited
partners and 1% to the General Partner. The General Partner also
receives an incentive management fee equal to 4% of available cash (as
defined).
All distributable cash from sales or dispositions (as defined) will be
distributed to the limited partners equal to their adjusted invested
capital (as defined) plus an amount equal to the sum of the greater of
an 8.5% cumulative, non-compounded annual return on the average after-
credit invested capital (as defined), less amounts previously
distributed (as defined); thereafter, after receipt by the General
Partner or its affiliates of any accrued but unpaid real estate
brokerage commissions, the balance will be distributed 15% to the
General Partner and 85% to the limited partners.
3. Allocation of Net Income and Net Losses from Operations
Net income and net loss (as defined) will be allocated 99% to the
limited partners and 1% to the General Partner with certain exceptions
as defined in the Agreement.
The Agreement provides that the fiscal year of the Partnership will be
the calendar year and that the partnership shall continue until
December 31, 2037, unless sooner terminated upon the occurrence of
certain events.
NOTE D - ACQUISITIONS
The Partnership acquired two properties and one general partnership
interest in a Venture during December 1987, as discussed below.
The Partnership purchased a four-story building located in
Pennsylvania for an acquisition and rehabilitation price of
$1,325,000.
The Partnership purchased an 89-room hotel located in Nebraska. The
acquisition and rehabilitation price of this property was $9,500,000.
The Partnership was admitted, with a 95% general partner interest, to
a Pennsylvania limited partnership which owned a building located in
Louisiana consisting of 105 units and 6,900 square feet of commercial
space, for a cash contribution of $3,450,000. This property was sold
in October 1996.
NOTE E- DEBT OBLIGATIONS
Debt obligations consist of the following:
December 31,
1996 1995
Variable rate insured Industrial Development Bonds $ 6,005,000 $ 6,005,000
due November 1, 1996. Interest payments are due
semi-annually. The bond are collateralized by the
related property. (A)
Note payable, interest at 13%; principal and
nterest due monthly; principal due December 1, 1996. 158,254 158,254
Mortgage payable, insured and regulated by the
Secretary of Housing and Urban Development (HUD)
under the National Housing Act; interest at 10.25%;
payable in monthly principal and interest installments
of $38,516.(B) 0 4,273,711
---------- ----------
$ 6,163,254 $10,436,965
========== ==========
(A) The bonds matured on November 1, 1996. See Note F.
Commitments and Contingencies.
(B) On October 10, 1996, the property was sold. See Note G. Sale
of St. Mary's Market.
Annual principal payments of debt obligations are as follows:
Year Ending December 31,
1997 $6,163,254
1998 0
1999 0
2000 0
2001 0
---------
$6,163,254
=========
NOTE F - COMMITMENTS AND CONTINGENCIES
In October 1996, a property owned by the Registrant, Radisson Redick,
was transferred to 1504 Harney Street Associates ("HSA") a limited
partnership in which the Registrant owns a 99% interest. The property
was transferred so that it would be held by the Registrant in a manner
similar to the other properties held by the Registrant. HSA was
unable to pay the bonds as they became due, and on October 28, 1996,
HSA filed a reorganization petition pursuant to Chapter 11 of the U.S.
Bankruptcy Code.
NOTE G - SALE OF ST. MARY'S MARKET
On October 10, 1996, one of the Registrant's Ventures, St. Mary's
Market Partnership sold its property to Residence Inn by Marriott,
Inc. The property was sold for $6,270,000. After payment of the
existing first mortgage loan balance of $4,432,356 and other selling
costs, the net proceeds of the sale were approximately $1,171,000.
NOTE H - INCOME TAX BASIS RECONCILIATION
Certain items enter into the determination of the results of
operations in different time periods for financial reporting ("book")
purposes and for income tax ("tax") purposes. A reconciliation of the
results of operations follows:
For the Years Ended December 31,
1996 1995 1994
------ ------ ------
Net loss - book ($ 607,725) ($ 712,598) ($ 827,606)
Excess of book over tax depreciation 12,815 57,160 30,091
Minority interest - tax only (122,089) 7,881 7,380
Gain on foreclosure 240,055 0 0
Audit adjustments 0 (238) 73,911
--------- --------- ---------
Net loss - tax ($ 476,944) ($ 647,795) ($ 716,224)
========= ========= =========
Partners' equity - book $1,938,698 $2,546,423 $3,259,021
Costs of issuance 1,419,240 1,419,240 1,419,240
Cumulative book over tax loss 1,101,945 971,163 906,360
Facade easement donation (tax only) (612,750) (612,750) (612,750)
--------- --------- ---------
Partners' equity - tax $3,847,133 $4,324,076 $4,971,871
========= ========= =========
<PAGE>
SUPPLEMENTAL INFORMATION
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1996
Initial Cost to
Partnership
Buildings and Date of Date
Description Encumbrances Land Improvements Constr. Acquired
(a) (e) (a)
21 unit
condominium
complex in - $ 61,046 $ 1,461,413 1987 12/31/87
Red Hill, PA
105 apartment
units and 6,900
square feet of
commercial space
in New Orleans, LA - - - 1988 12/30/87
89 room hotel
in Omaha, NE 6,163,254 286,909 10,166,705 1986-1987 12/28/87
--------- ------- ----------
$6,163,254 $347,955 $11,628,118
========= ======= ==========
Costs Gross Amount at which Carried
Capitalized at December 31, 1996
Subsequent to
Acquisition
Buildings and Accum.
Description Improvements Land Improvements Total Depr.
(a) (b)(c) (c)(d)
21 unit
condominium
complex in
Red Hill, PA - $ 61,046 $ 1,462,231 $ 1,523,277 $ 536,862
105 apartment
units and 6,900
square feet of
commercial space
in New Orleans, LA - - 67,312 67,312
89 room hotel
in Omaha, NE 116,598 286,909 10,488,978 10,892,485 4,240,316
------- ------- ---------- ---------- ---------
$116,598 $347,955 $12,018,521 $12,483,074 $4,777,178
======= ======= ========== ========== =========
<PAGE>
DIVERSIFIED HISTORIC INVESTORS V
(a limited partnership)
NOTES TO SCHEDULE XI
December 31, 1996
(A) All properties are certified historic structures as defined in
the Internal Revenue Code of 1986, or are eligible for
designation as such. The "date of construction" refers to the
period in which such properties are rehabilitated.
(B) The cost of real estate owned at December 31, 1996, for Federal
income tax purposes was approximately $12,149,789. However,
the depreciable basis of buildings and improvements for the
Omaha and Red Hill properties was reduced for Federal income
tax purposes by 50% of the historic rehabilitation credit
obtained.
(C) Reconciliation of real estate:
1996 1995 1994
------ ------ ------
Balance at beginning of year $19,507,622 $19,403,221 $19,330,374
Additions during the year:
Improvements 170,375 104,401 72,847
Deductions during the year:
Sale of property (7,194,923) 0 0
---------- ---------- ----------
Balance at end of year $12,483,074 $19,507,622 $19,403,221
========== ========== ==========
Reconciliation of accumulated depreciation:
1996 1995 1994
------ ------ ------
Balance at beginning of year $ 6,514,441 $ 5,814,124 $ 5,089,745
Depreciation expense for the year 695,508 700,317 724,379
Deductions during the year (2,432,771) 0 0
---------- ---------- ----------
Balance at end of year $ 4,777,178 $ 6,514,441 $ 5,814,124
========== ========== ==========
(D) See Note B to the consolidated financial statements for
depreciation method and lives.
(E) See Note E to the consolidated financial statements for further
information.
<PAGE>
Item 9. Changes in and disagreements with Accountants on
Accounting and Financial Disclosure
None.
PART III
Item 10. Directors and Executive Officers of Registrant
a. Identification of Directors - Registrant has no
directors.
b. Identification of Executive Officers
The General Partner of the Registrant is Dover
Historic Advisors V (DoHA-V), a Pennsylvania general partnership. The
partners of DoHA-V are as follows:
Name Age Position Term of Office Period Served
Gerald Katzoff 49 Partner in DoHA-V No fixed term July 1987-May 1997
DHP, Inc. -- Partner in DoHA-V No fixed term July 1987-May 1997
(Formerly Dover
Historic
Properties, Inc.)
SWDHA, Inc. -- Partner in DoHA-V No fixed term Since May 1997
EPK, Inc. -- Partner in DoHA-V No fixed term Since May 1997
For further description of DHP, Inc., see paragraph e.
of this Item. There is no arrangement or understanding between either
person named above and any other person pursuant to which any person
was or is to be selected as an officer.
c. Identification of Certain Significant Employees.
Registrant has no employees. Its administrative and operational
functions are carried out by a property management and partnership
administration firm engaged by the Registrant.
d. Family Relationships. There is no family
relationship between or among the executive officers and/or any person
nominated or chosen by Registrant to become an executive officer.
e. Business Experience. DoHA-V is a general
partnership formed in 1988. The General Partner is responsible for
management and control of Registrant's affairs and will have general
responsibility and authority in conducting its operations. The
General Partner may retain its affiliates to manage certain of the
Properties.
On May 13, 1997, SWDHA, Inc. replaced Gerald
Katzoff and EPK, Inc. replaced DHP, Inc. as partners of DoHA-V.
Spencer Wertheimer, the President of SWDHA, Inc., is an attorney with
extensive experience in real estate activities ventures.
EPK, Inc. is a Delaware corporation formed for the
purpose of managing properties or interests therein. EPK, Inc. is a
wholly-owned subsidiary of D, LTD, an entity formed in 1985 to act as
the holding company for various corporations engaged in the
development and management of historically certified properties and
conventional real estate as well as a provider of financial (non-
banking) services. EPK, Inc. is an affiliate of DoHA-V.
The officers and directors of EPK, Inc. are described
below.
Donna M. Zanghi (age 40) was appointed on May 13, 1997
as Secretary and Treasurer of EPK, Inc. Ms. Zanghi previously served
as Secretary and Treasurer of DHP, Inc. since June 14, 1993 and as a
Director and Secretary/Treasurer of D, LTD. She was associated with
DHP, Inc. and its affiliates since 1984 except for the period from
December 1986 to June 1989 and the period from November 1, 1992 to
June 14, 1993.
Michele F. Rudoi (age 32) was appointed on May 13, 1997
as Assistant Secretary and Director of EPK, Inc. Ms. Rudoi previously
served as Assistant Secretary and Director of both D, LTD and DHP,
Inc. since January 27, 1993.
Item 11. Executive Compensation
a. Cash Compensation - During 1996, Registrant has
paid no cash compensation to DoHA-V, any partner therein or any person
named in paragraph c. of Item 10.
b. Compensation Pursuant to Plans - Registrant has no
plan pursuant to which compensation was paid or distributed during
1996, or is proposed to be paid or distributed in the future, to DoHA-
V, any partner therein, or any person named in paragraph c. of Item 10
of this report.
c. Other Compensation - No compensation not referred
to in paragraph a. or paragraph b. of this Item was paid or
distributed during 1996 to DoHA-V, any partner therein, or any person
named in paragraph c. of Item 10.
d. Compensation of Directors - Registrant has no
directors.
e. Termination of Employment and Change of Control
Arrangement -
Registrant has no compensatory plan or arrangement, with respect to
any individual, which results or will result from the resignation or
retirement of any individual, or any termination of such individual's
employment with Registrant or from a change in control of Registrant,
or a change in such individual's responsibilities following such a
change in control.
Item 12. Security Ownership of Certain Beneficial Owners and
Management
a. Security Ownership of Certain Beneficial Owners -
No person is known to Registrant to be the beneficial owner of more
than five percent of the issued and outstanding Units.
b. Security Ownership of Management - No equity
securities of Registrant are beneficially owned by any person named in
paragraph c. of Item 10.
c. Changes in Control - Registrant does not know of
any arrangement, the operation of which may at a subsequent date
result in a change in control of Registrant.
Item 13. Certain Relationships and Related Transactions
a. Pursuant to Registrant's Amended and Restated
Agreement of Limited Partnership, DoHA-V is entitled to 10% of
Registrant's distributable cash from operations in each year. There
was no such share allocable to DoHA-V for fiscal years 1994 through
1996.
b. Certain Business Relationships - Registrant has no
directors.
c. Indebtedness of Management - No employee of
Registrant, Registrant's general partner, (or any employee thereof),
or any affiliate of any such person, is or has at any time been
indebted to Registrant.
<PAGE>
PART V
Item 14. (A) Exhibits, Financial Statement Schedules and Reports on
Form 8-K.
1. Financial Statements:
a. Consolidated Balance Sheets at December 31, 1996 and 1995.
b. Consolidated Statements of Operations for the Years Ended
December 31, 1996, 1995 and 1994.
c. Consolidated Statements of Changes in Partners' Equity
for the Years Ended December 31, 1996, 1995 and 1994.
d. Consolidated Statements of Cash Flows for the Years Ended
December 31, 1996, 1995 and 1994.
e. Notes to consolidated financial statements.
2. Financial statement schedules:
a. Schedule XI - Real Estate and Accumulated Depreciation.
b. Notes to Schedule XI.
3. Exhibits:
(a) Exhibit
Number Document
3 Registrant's Amended and Restated
Certificate of Limited Partnership and
Agreement of Limited Partnership,
previously filed as part of Amendment
No. 2 of Registrant's Registration
Statement on Form S-11, are
incorporated herein by reference.
21 Subsidiaries of the Registrant are
listed in Item 2. Properties of this
Form 10-K.
(b) Reports on Form 8-K:
No reports were filed on Form 8-K during the quarter
ended December 31, 1996.
(c) Exhibits:
See Item 14(A)(3) above.
<PAGE>
SIGNATURES
Pursuant to the requirement of Section 13 or 15(d) of the
Securities Exchange Act of 1934, Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
DIVERSIFIED HISTORIC INVESTORS V
Date: August 11, 1997 By: Dover Historic Advisors V, General Partner
---------------
By: EPK, Inc., Partner
By: /s/ Donna M. Zanghi
-----------------------
DONNA M. ZANGHI,
Secretary and Treasurer
By: /s/ Michele F. Rudoi
-----------------------
MICHELE F. RUDOI,
Assistant Secretary
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of Registrant and in the capacities and on the dates indicated.
Signature Capacity Date
DOVER HISTORIC ADVISORS V General Partner
By: EPK, Inc., Partner
By: /s/ Donna M. Zanghi August 11, 1997
----------------------- ---------------
DONNA M. ZANGHI,
Secretary and Treasurer
By: /s/ Michele F. Rudoi August 11, 1997
----------------------- ---------------
MICHELE F. RUDOI,
Assistant Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 1,126,711
<SECURITIES> 0
<RECEIVABLES> 172,869
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 12,483,074
<DEPRECIATION> 4,777,178
<TOTAL-ASSETS> 9,046,109
<CURRENT-LIABILITIES> 691,442
<BONDS> 6,163,254
0
0
<COMMON> 0
<OTHER-SE> 1,938,698
<TOTAL-LIABILITY-AND-EQUITY> 9,046,109
<SALES> 0
<TOTAL-REVENUES> 3,817,028
<CGS> 0
<TOTAL-COSTS> 2,843,151
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 662,031
<INCOME-PRETAX> (607,725)
<INCOME-TAX> 0
<INCOME-CONTINUING> (607,725)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (607,725)
<EPS-PRIMARY> (54.00)
<EPS-DILUTED> 0
</TABLE>
