<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 20, 1997
WINDSOR PARK PROPERTIES 5, A CALIFORNIA LIMITED PARTNERSHIP
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(Exact name of registrant as specified in its charter)
California 0-16642 33-0243223
-------------------- ---------------- -------------------
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
120 W. Grand Avenue, Suite 202, Escondido, CA 92025
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (619) 746-2411
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Item 2. Acquisition or Disposition of Assets
------------------------------------
On February 20, 1997, Windsor Park Properties 5 (the Partnership) purchased a 9%
interest in the Apache East Estates and Denali Park Estates manufactured home
communities (the Communities) located in Apache Junction, Arizona. The
remaining interests in the Communities were acquired by affiliated entities.
The Communities are in good condition, and the Partnership intends to hold them
as a medium-term (four to six year) investment. During the investment period
the Partnership intends to continue to operate the Communities as manufactured
home communities.
Apache East Estates is situated on approximately 16 acres of land and was
developed around 1982. The community contains 123 manufactured home spaces, and
amenities include a clubhouse, swimming pool and spa. Denali Park Estates is
situated on approximately 33 acres of land and was developed around 1979. The
community contains 162 manufactured home spaces, and amenities include a
clubhouse, swimming pool and spa. All assets acquired will continue to be used
in the operations of the Communities. The General Partners of the Partnership
anticipate expending $15,000 for various capital improvement and maintenance
projects at the Communities over the next 12 months. It is the opinion of the
General Partners that the Communities are adequately insured.
The total cost of the Communities was approximately $5,183,000 ($5,150,000 paid
to the sellers and other costs of $33,000). The Partnership's cost of its
interest in the Communities was approximately $466,500 ($463,500 paid to the
sellers and other costs of $3,000). The purchase prices were negotiated through
arms-length bargaining processes with the sellers. Apache East Estates was
acquired from Apache East Estates M.H.P., an Arizona general partnership and
Denali Park Estates was acquired from Denali Park Estates M.H.P., an Arizona
general partnership. The registrant's General Partners are not affiliated with
the sellers of the Communities.
In connection with the purchase, the Partnership and the affiliated buyers of
the Communities obtained a $3,040,000 mortgage loan. The loan, which is
collateralized by the Communities, initially bears interest at a fixed rate of
8.375%. In March 2000 and March 2003, the interest rate adjusts to the yield on
the three year Treasury Note plus 2.2%. The loan is due in March 2006. Loan
costs of approximately $95,000 were incurred.
The Communities' manufactured home spaces are rented to tenants on a month-to-
month basis, and current base rental rates average $209 per month. The
Communities are located near several other manufactured home communities with
comparable base rental rates.
The Communities are currently 73% occupied and have been approximately 70%
occupied for the past three years. Other manufactured home communities in the
immediate area are approximately 97% occupied.
Other material factors considered by the General Partners in assessing the
Communities include ad valorem taxes for the 1996 tax year which totaled $39,600
($17.63 per $1,000 full cash value) and utility rates which are expected to
increase 4% per year.
The sources of funds for this acquisition were financing proceeds from
investment properties already owned by the Partnership and the mortgage loan
obtained as described above.
After reasonable inquiry, the Partnership is not aware of any material factors
related to the Communities, other than as set forth in this Form 8-K/A, that
would cause the reported financial information not to be necessarily indicative
of future operating results.
2
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Item 7. Financial Statements, Proforma Financial Information and Exhibits
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(a) Financial Statements and Proforma Financial Information of
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Apache East Estates and Denali Park Estates Manufactured
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Home Communities
----------------
<TABLE>
<CAPTION>
<S> <C>
Page
(i) Combined Historical Summary of Gross Income and
Direct Operating Expenses for the year ended
December 31, 1996 (audited) 4
(ii) Estimated Proforma Statement of Taxable Net
Operating Income (Loss) for the year ended December
31, 1997 (unaudited) 8
(iii) Estimated Proforma Statement of Cash Available for
the year ended December 31, 1997 (unaudited) 8
(b) Proforma Financial Information of Windsor Park Properties 5
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(i) Proforma Balance Sheet at December 31, 1996 (unaudited) 10
(ii) Proforma Statement of Operations for the year ended
December 31, 1996 (unaudited) 12
</TABLE>
(c) Exhibits
--------
10) Material Contracts
Apache East Estates Mobile Home Park
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Denali Park Estates Mobile Home Park
------------------------------------
The Purchase and Sale Contracts (both dated November 8, 1996)
were previously filed on Form 8-K dated March 5, 1997 and are
incorporated herein by reference.
3
<PAGE>
Item 7(a)(i)
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APACHE EAST ESTATES AND
DENALI PARK ESTATES
MANUFACTURED HOME COMMUNITIES
COMBINED HISTORICAL SUMMARY OF GROSS INCOME
AND DIRECT OPERATING EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 1996
AND INDEPENDENT AUDITORS' REPORT
4
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Partners and Shareholders
Windsor Park Properties 3
Windsor Park Properties 4
Windsor Park Properties 5
Windsor Park Properties 7
Windsor Real Estate Investment Trust 8
Escondido, California
We have audited the accompanying combined historical summary of gross income and
direct operating expenses (historical summary) of Apache East Estates and Denali
Park Estates Manufactured Home Communities (the Communities), both of which are
under common ownership and management, for the year ended December 31, 1996.
This historical summary is the responsibility of the Communities' management.
Our responsibility is to express an opinion on the historical summary based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the historical summary is free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the historical summary. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall presentation of the historical summary. We believe
that our audit provides a reasonable basis for our opinion.
The accompanying combined historical summary was prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission (for inclusion in the Current Report on Form 8-K/A of Windsor Park
Properties 3, Windsor Park Properties 4, Windsor Park Properties 5, Windsor Park
Properties 7, and Windsor Real Estate Investment Trust 8) as described in Note 1
to the combined historical summary, and is not intended to be a complete
presentation of the Communities' combined revenues and expenses.
In our opinion, such historical summary presents fairly, in all material
respects, the combined gross income and direct operating expenses described in
Note 1 to the combined historical summary of gross income and direct operating
expenses of Apache East Estates and Denali Park Estates Manufactured Home
Communities for the year ended December 31, 1996 in conformity with generally
accepted accounting principles.
Deloitte & Touche LLP
Costa Mesa, California
February 6, 1997
5
<PAGE>
APACHE EAST ESTATES AND DENALI PARK ESTATES
MANUFACTURED HOME COMMUNITIES
COMBINED HISTORICAL SUMMARY OF GROSS INCOME
AND DIRECT OPERATING EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 1996
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GROSS INCOME:
<S> <C>
Rent and utilities $ 595,000
Other 4,000
-----------
Total gross income 599,000
DIRECT OPERATING EXPENSES:
Utilities 79,000
Wages 43,000
Property taxes 39,000
Repairs and maintenance 23,000
Insurance 6,000
Other 21,000
-----------
Total direct operating expenses 211,000
-----------
NET OPERATING INCOME $ 388,000
===========
</TABLE>
See accompanying note to combined historical summary
of gross income and direct operating expenses
6
<PAGE>
APACHE EAST ESTATES AND DENALI PARK ESTATES
MANUFACTURED HOME COMMUNITIES
NOTE TO COMBINED HISTORICAL SUMMARY OF GROSS INCOME
AND DIRECT OPERATING EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 1996
- -------------------------------------------------------------------------------
1. BASIS OF PRESENTATION
The accompanying Combined Historical Summary of Gross Income and Direct
Operating Expenses (the historical summary) includes the accounts of Apache
East Estates and Denali Park Estates Manufactured Home Communities (the
Communities), both of which are under common ownership and management. The
historical summary has been prepared for the purpose of complying with the
rules and regulations of the Securities and Exchange Commission (for
inclusion in the Current Report on Form 8-K/A of Windsor Park Properties 3,
Windsor Park Properties 4, Windsor Park Properties 5, Windsor Park
Properties 7, and Windsor Real Estate Investment Trust 8). Net operating
income is computed as gross income from mobile home operations, less direct
operating expenses from mobile home operations, excluding items not
comparable to the proposed future operations of the Communities including
depreciation, amortization, interest and nonproperty administrative
expenses. Consequently, net operating income as presented is not intended
to be a complete presentation of the Communities' revenues and expenses.
7
<PAGE>
Item 7(a)(ii)
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Apache East Estates and Denali Park Estates Manufactured Home Communities
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Estimated Proforma Statement
Of Taxable Net Operating Income (Loss)
For The Year Ended December 31, 1997
<TABLE>
<CAPTION>
Proforma
Year Ended Proforma Year Ended
December 31, 1996 Adjustments December 31, 1997
-------------------- -------------------- --------------------
(unaudited) (unaudited)
<S> <C> <C> <C>
Revenues:
- --------
Rent and utilities $ 595,000 $ $ 595,000
Other 4,000 4,000
--------------------- -------------------- --------------------
599,000 -- 599,000
--------------------- -------------------- --------------------
Expenses:
- --------
Utilities 79,000 79,000
Wages 43,000 43,000
Property taxes 39,000 39,000
Repairs and
maintenance 23,000 23,000
Insurance 6,000 6,000
Other 21,000 21,000
Management fees 30,000 30,000
Interest 265,000 265,000
Depreciation 183,000 183,000
--------------------- -------------------- --------------------
211,000 478,000 689,000
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Taxable net operating
income (loss) $ 388,000 $ (478,000) $ (90,000)
===================== ==================== ====================
</TABLE>
Item 7(a)(iii)
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Apache East Estates and Denali Park Estates Manufactured Home Communities
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Estimated Proforma Statement of Cash Available
For The Year Ended December 31, 1997
(unaudited)
<TABLE>
<CAPTION>
<S> <C>
Proforma Taxable Net Operating Loss $ (90,000)
Add: Depreciation 183,000
--------------------
Proforma Cash Available $ 93,000
====================
</TABLE>
See accompanying notes to proforma financial statements.
8
<PAGE>
Apache East Estates and Denali Park Estates Manufactured Home Communities
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Notes To Estimated Proforma Statement Of
Taxable Net Operating Income (Loss) And Estimated
Proforma Statement Of Cash Available
(unaudited)
Note 1. Basis Of Presentation:
----------------------
The preceding proforma financial statements for the year ended December 31, 1997
are based on the audited Combined Historical Summary of Gross Income and Direct
Operating Expenses of Apache East Estates and Denali Park Estates manufactured
home communities for the year ended December 31, 1996. They contain certain
proforma adjustments made to reflect changes in operations in existence at the
date of acquisition which will be reflected in the properties first year of
operations.
Note 2. Proforma Adjustments:
---------------------
(a) Management Fees
---------------
This adjustment reflects expected management fees of 5% of estimated gross
revenues payable to the General Partners.
(b) Interest
--------
This adjustment reflects interest expense incurred on the loan obtained to
acquire the properties as well as the amortization of loan costs incurred
to obtain the loan. Interest rates are assumed to be those in effect on
the date of acquisition.
(c) Depreciation
------------
The computation of depreciation is based on the cost of the properties
including estimated acquisition expenses and subsequent capital improvement
projects. The allocation of the cost of the properties to the various
asset categories is estimated based on appraised values. Depreciation has
been computed on a straight-line basis over the estimated useful lives of
the asset.
<TABLE>
<CAPTION>
Depreciable
Life Cost Depreciation
-------------- ------------- -------------
<S> <C> <C> <C>
Land $ 1,597,000
Buildings and improvements 20 yrs. 3,573,000 $ 179,000
Furniture and equipment 7 yrs. 28,000 4,000
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$ 5,198,000 $ 183,000
=============== =============
</TABLE>
The costs above include $15,000 of anticipated property improvements.
Note 3. Partnership Income and Expenses:
--------------------------------
The proforma statements of taxable net operating income and of cash available do
not include any income, cost or expense pertaining to the operation of the
Partnership.
9
<PAGE>
Item 7(b)(i) - Proforma Financial Information
- ---------------------------------------------
The following unaudited proforma balance sheet presents the financial position
of Windsor Park Properties 5 (the Partnership) on December 31, 1996, assuming
that the purchase of the interests in the Apache East Estates and Denali Park
Estates manufactured home communities (accounted for as joint ventures), which
occurred on February 20, 1997, occurred on that date.
The interests in the Apache East Estates and Denali Park Estates communities
were purchased with funds received from the refinancing of existing Partnership
properties and borrowings from a third party lender. The following unaudited
proforma balance sheet has been prepared assuming that the acquisition of the
Apache East Estates and Denali Park Estates communities was accounted for as an
investment using the equity method of accounting.
This statement should be read in conjunction with the other proforma financial
statements and notes thereto and the discussion of the properties contained in
Item 2, included elsewhere in this Form 8-K/A.
<TABLE>
<CAPTION>
Windsor Park Properties 5
-------------------------
Proforma Balance Sheet
December 31, 1996
(unaudited)
Proforma Proforma
December 31, 1996 Adjustments December 31,1996
------------------- ------------------ --------------------
<S> <C> <C> <C>
ASSETS
- ------
Property held for
investment, net $ 2,745,600 $ $ 2,745,600
Investments in joint
ventures 2,160,500 201,400 2,361,900
Cash and cash equivalents 523,800 (201,400) 322,400
Other assets 105,000 105,000
------------------ ------------------ --------------------
$ 5,534,900 $ -- $ 5,534,900
================== ================== ====================
LIABILITIES AND
- ---------------
PARTNERS' EQUITY
- ----------------
Mortgage note payable $ 1,097,000 $ $ 1,097,000
Accounts payable and
other liabilities 85,200 85,200
Partners' equity 4,352,700 4,352,700
------------------ ------------------ --------------------
$ 5,534,900 $ -- $ 5,534,900
================== ================== ====================
</TABLE>
See accompanying notes to proforma balance sheet.
10
<PAGE>
Windsor Park Properties 5
-------------------------
Notes To Proforma Balance Sheet
December 31, 1996
(unaudited)
Note 1. Basis Of Presentation
---------------------
The unaudited proforma balance sheet of Windsor Park Properties 5 (the
Partnership) presents the financial position of the Partnership at December 31,
1996 assuming that the purchase of the interests in the Apache East Estates and
Denali Park Estates manufactured home communities (accounted for as joint
ventures), which occurred on February 20, 1997, occurred on that date.
The interests in the Apache East Estates and Denali Park Estates communities
were purchased with funds previously received from the refinancing of existing
Partnership properties and borrowings from a third party lender. The following
unaudited proforma balance sheet has been prepared assuming that the acquisition
of the Apache East Estates and Denali Park Estates communities was accounted for
as an investment using the equity method of accounting.
Note 2. Proforma Adjustments
--------------------
(a) Investments in Joint Ventures
-----------------------------
This adjustment reflects the Partnership's cost of its interests in the
Apache East Estates and Denali Park Estates communities ($466,500), less
its proportionate obligation in the new loan placed on the Communities
($265,100).
(b) Cash and Cash Equivalents
-------------------------
This adjustment reflects the funds used to purchase the interests in the
Apache East Estates and Denali Park Estates communities.
11
<PAGE>
Item 7(b)(ii) - Proforma Financial Information
- ----------------------------------------------
The following unaudited proforma statement of operations of Windsor Park
Properties 5 (the Partnership) for the year ended December 31, 1996 combines the
historical results of operations of the Partnership and the Apache East Estates
and Denali Park Estates manufactured home communities for the year ended
December 31, 1996, with the estimated proforma results of the Apache East
Estates and Denali Park Estates communities assuming that they were purchased on
January 1, 1996. The Apache East Estates and Denali Park Estates communities
were purchased on February 20, 1997.
The Apache East Estates and Denali Park Estates communities were purchased with
funds received from the refinancing of existing Partnership properties and
borrowings from a third party lender. The unaudited proforma statement of
operations has been prepared assuming that the acquisition of the Apache East
Estates and Denali Park Estates communities was accounted for as an investment
using the equity method of accounting.
This statement should be read in conjunction with the other proforma financial
statements and notes thereto and the discussion of the properties contained in
Item 2 included elsewhere in this Form 8-K/A.
Windsor Park Properties 5
-------------------------
Proforma Statement of Operations
For the Year Ended December 31, 1996
(unaudited)
<TABLE>
<CAPTION>
Year Ended December 31, 1996
----------------------------
Proforma
Year Ended
The Apache East/ Proforma December 31,
Partnership Denali Park Adjustments 1996
----------------- ----------------- -------------- ------------------
<S> <C> <C> <C> <C>
Revenues
- --------
Rent and utilities $ 436,300 $ 595,000 $ (595,000) $ 436,300
Equity in earnings
of joint ventures 83,100 (8,400) 74,700
Interest 34,400 34,400
Other 14,200 4,000 (4,000) 14,200
----------------- ----------------- -------------- ---------------
568,000 599,000 (607,400) 559,600
----------------- ----------------- ---------------- ---------------
Expenses
- --------
Property operating 292,800 211,000 (211,000) 292,800
Depreciation and
amortization 106,800 106,800
Interest 102,100 102,100
General and
administrative 89,900 89,900
---------------- ----------------- ---------------- ---------------
591,600 211,000 (211,000) 591,600
---------------- ----------------- ---------------- ---------------
Net Loss $ (23,600) $ 388,000 $ (396,400) $ (32,000)
================ ================== ================= ===============
</TABLE>
See accompanying notes to proforma statement of operations.
12
<PAGE>
Windsor Park Properties 5
-------------------------
Notes To Proforma Statement Of Operations
For The Year Ended December 31, 1996
(unaudited)
Note 1. Basis Of Presentation
---------------------
The unaudited proforma statement of operations of Windsor Park Properties 5 (the
Partnership) for the year ended December 31, 1996 combines the historical
results of operations of the Partnership and the Apache East Estates and Denali
Park Estates manufactured home communities for the year ended December 31, 1996,
with the estimated proforma results of the Apache East Estates and Denali Park
Estates communities assuming that they were purchased on January 1, 1996. The
Apache East Estates and Denali Park Estates communities were purchased on
February 20, 1997.
The Apache East Estates and Denali Park Estates communities were purchased with
funds received from the refinancing of existing Partnership properties and
borrowings from a third party lender. The unaudited proforma statement of
operations has been prepared assuming that the acquisition of the Apache East
Estates and Denali Park Estates communities was accounted for as an investment
using the equity method of accounting.
Note 2. Proforma Adjustments
--------------------
The Partnership's interests in the Apache East Estates and Denali Park Estates
manufactured home communities are accounted for as investments using the equity
method of accounting. Accordingly, all historical revenue and expense
components of Apache East Estates and Denali Park Estates are eliminated through
proforma adjustments and the Partnership's interest in the net earnings of
Apache East Estates and Denali Park Estates is reflected as a proforma
adjustment to "Equity in earnings of joint ventures."
(a) Equity in Earnings of Joint Ventures
------------------------------------
This adjustment reflects the Partnership's interest in the net earnings of
the Apache East Estates and Denali Park Estates communities. The net
earnings of the communities include adjustments to management fees,
interest expense and depreciation, based on facts and circumstances in
existence on the date of acquisition.
13
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
WINDSOR PARK PROPERTIES 5
(A California Limited Partnership)
----------------------------------
(Registrant)
By /s/John A. Coseo, Jr.
--------------------------------------
JOHN A. COSEO, JR.
General Partner
Date: April 28, 1997
14
