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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended March 31, 1998
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[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
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Commission file number 0-16642
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WINDSOR PARK PROPERTIES 5, A CALIFORNIA LIMITED PARTNERSHIP
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(Exact name of small business issuer as specified in its charter)
California 33-0243223
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
6430 S. Quebec Street, Englewood, Colorado 80111
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(Address of principal executive offices)
(303) 741-3707
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(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes (x) No ( )
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TABLE OF CONTENTS
PART I
<TABLE>
<CAPTION>
Page
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<S> <C> <C>
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II
Item 6. Exhibits and Reports on Form 8-K 9
SIGNATURE 10
</TABLE>
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WINDSOR PARK PROPERTIES 5
(A California Limited Partnership)
BALANCE SHEET
(unaudited)
<TABLE>
<CAPTION>
March 31, 1998
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<S> <C>
ASSETS
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Property held for investment:
Land $ 1,507,800
Buildings and improvements 2,067,500
Fixtures and equipment 34,400
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3,609,700
Less accumulated depreciation (990,900)
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2,618,800
Investments in joint ventures and limited partnerships 2,263,900
Cash and cash equivalents 399,300
Deferred financing costs 40,500
Other assets 34,400
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Total Assets $ 5,356,900
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LIABILITIES AND PARTNERS' EQUITY
- --------------------------------
Liabilities:
Mortgage note payable $ 1,097,000
Accounts payable 900
Accrued expenses 41,100
Due to General Partners and affiliates 23,100
Tenant deposits and other liabilities 28,900
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Total Liabilities 1,191,000
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Partners' equity:
Limited partners 4,145,200
General partners 20,700
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4,165,900
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Total Liabilities and Partner's Equity $ 5,356,900
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</TABLE>
See accompanying notes to financial statements.
3
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WINDSOR PARK PROPERTIES 5
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
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1998 1997
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<S> <C> <C>
REVENUES
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Rent and utilities $ 126,800 $ 114,900
Equity in earnings of joint ventures and limited partnerships 30,900 26,500
Interest 7,700 5,600
Other 2,700 4,200
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168,100 151,200
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COSTS AND EXPENSES
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Property operating 65,500 63,100
Depreciation and amortization 27,100 26,900
Interest 26,400 25,700
General and administrative:
Related parties 7,400 13,500
Other 16,900 11,800
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143,300 141,000
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Net income $ 24,800 $ 10,200
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Net income - general partners $ 200 $ 100
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Net income - limited partners $ 24,600 $ 10,100
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Basic and dilutive earnings per limited partnership unit $ 0.10 $ 0.04
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</TABLE>
See accompanying notes to financial statements.
4
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WINDSOR PARK PROPERTIES 5
(A California Limited Partnership)
STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
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1998 1997
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<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 24,800 $ 10,200
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization 27,100 26,900
Equity in earnings of joint ventures and limited
partnerships (30,900) (26,500)
Joint ventures' and limited partnerships cash
distributions 30,900 26,500
Amortization of deferred financing costs 2,300 2,200
Gain on sale of property held for investment 0 (1,300)
Changes in operating assets and liabilities:
(Increase) decrease in other assets (5,400) 3,100
Accounts payable (4,000) (15,900)
Accrued expenses 21,700 1,900
Due to General Partners and affiliates 2,100 0
Tenant deposits and other liabilities (6,000) (2,600)
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Net cash provided by operating activities 62,600 24,500
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Cash flows from investing activities:
Investment in joint venture and limited partnerships 0 (197,500)
Joint ventures' and limited partnerships cash
distributions 60,600 27,300
Proceeds from sale of property held for investment 0 10,800
Increase in property held for investment (2,000) (3,800)
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Net cash (used in) provided by investing activities 58,600 (163,200)
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Cash flows from financing activities:
Cash distributions (98,500) (101,000)
Repurchase of limited partnership units (300) (4,100)
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Net cash used in financing activities (98,800) (105,100)
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Net increase (decrease) in cash and cash equivalents 22,400 (243,800)
Cash and cash equivalents at beginning of period 376,900 523,800
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Cash and cash equivalents at end of period $ 399,300 $ 280,000
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</TABLE>
See accompanying notes to financial statements.
5
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WINDSOR PARK PROPERTIES 5
(A California Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. THE PARTNERSHIP
Windsor Park Properties 5, A California Limited Partnership (the Partnership),
was formed in June 1987 for the purpose of acquiring and holding existing
manufactured home communities for investment. The General Partners of the
Partnership are The Windsor Corporation ("TWC"), a California corporation, and
John A. Coseo, Jr. In September 1997, Chateau Communities Inc., (Chateau), a
publicly held real estate investment trust, purchased 100 percent of the shares
of the Windsor Corporation.
The Partnership was funded through a public offering of 244,729 limited
partnership units at $100 per unit which commenced in September 1987 and
terminated in September 1988. The Partnership term is set to expire in
December 2001; however, the Partnership may either be dissolved earlier or
extended under certain circumstances. The Partnership may be extended at the
recommendation of the General Partners with approval of a majority of the
Limited Partners.
NOTE 2. BASIS OF PRESENTATION
The balance sheet at March 31, 1998 and the related statements of operations
for the three months ended March 31, 1998 and 1997 and the statements of cash
flows for the three months ended March 31, 1998 and 1997 are unaudited.
However, in the opinion of the General Partners, they contain all adjustments,
of a normal recurring nature, necessary for a fair presentation of such
financial statements. Interim results are not necessarily indicative of
results for a full year.
The financial statements and notes are presented as permitted by Form 10-QSB
and do not contain certain information included in the Partnership's annual
financial statements and notes on form 10-KSB for the year ended December 31,
1997.
NOTE 3. INVESTMENTS IN JOINT VENTURES AND LIMITED PARTNERSHIPS
The Partnership's investments in joint ventures and limited partnerships
consist of interests in five manufactured home communities at March 31, 1998.
The combined condensed results of operations of the joint venture and limited
partnership properties for the three months ended March 31, 1998 and 1997 are
as follows:
<TABLE>
<CAPTION>
1998 1997
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<S> <C> <C>
Property revenues $ 816,400 $ 699,000
Expenses:
Property operating 353,200 310,600
Interest 247,500 184,300
Depreciation 146,100 112,600
General and administrative 5,000 0
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751,800 607,500
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Net income $ 64,600 $ 91,500
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</TABLE>
6
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NOTE 4. BASIC AND DILUTIVE EARNINGS (LOSS) PER LIMITED PARTNERSHIP UNIT
Net income (loss) per limited partnership unit is calculated based on the
weighted average number of limited partnership units outstanding during the
period and the net income (loss) allocated to the Limited Partners. The
weighted average number of limited partnership units outstanding during the
three months ended March 31, 1998 and 1997 was 238,507 and 240,545,
respectively.
In 1997, the Partnership adopted Statement of Financial Accounting Standards
No. 128 (SFAS 128), "Earnings Per Share." This accounting standard specifies
new computation, presentation, and disclosure requirements for earnings per
share to be applied retroactively. Among other things, SFAS 128 requires
presentation of basic and diluted earnings per share on the face of the income
statement. The adoption of SFAS 128 had no effect on the per unit results
previously reported.
NOTE 5. DISTRIBUTIONS TO LIMITED PARTNERS
Distributions to limited partners in excess of net income allocated to limited
partners are considered a return of capital. A breakdown of cash distributions
to limited partners for the three months ended March 31, 1998 and 1997 follows:
<TABLE>
<CAPTION>
1998 1997
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Per Per
Amount Unit Amount Unit
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<S> <C> <C> <C> <C>
Net income
- limited partners $ 24,600 $ 0.10 $ 10,100 $ 0.04
Return of capital 75,400 0.32 89,900 0.38
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$ 100,000 $ 0.42 $ 100,000 $ 0.42
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</TABLE>
7
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WINDSOR PARK PROPERTIES 5
(A California Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Three months ended March 31, 1998 as compared to three months ended March 31,
1997
Results of Operations
The results of operations for the three months ended March 31, 1998 and 1997
are not directly comparable due to the purchase of interests in the Apache East
Estates and Denali Park Estates manufactured home communities in February 1997.
The Partnership's net income was $24,800 and $10,200 for the three months ended
March 31, 1998 and 1997, respectively. The net income per common share was
$0.10 in 1998 compared to $0.04 in 1997.
Rent and utilities revenues increased from $114,900 in 1997 to $126,800 in 1998
due to rent increases and increased occupancy at both the Lakeside and
Plantation Estates communities.
Equity in earnings of joint ventures and limited partnerships represents the
Partnership's share of the net income of five manufactured home communities.
Equity in earnings of joint ventures and limited partnerships increased from
$26,500 in 1997 to $30,900 in 1998, mainly due to rent increases recognized at
the Town & Country Estates, Rancho Margate and Winterhaven communities, offset
by the losses recognized at Apache East and Denali Park.
Interest income increased from $5,600 in 1997 to $7,700 in 1998 due mainly to
higher cash balances maintained by the Partnership.
Property operating expenses increased slightly from $63,100 in 1997 to $65,500
in 1998.
Interest expense increased from $25,300 in 1997 to $26,400 in 1998, due to
slightly higher interest rates.
General and administrative expense decreased slightly from $25,300 in 1997 to
$24,300 in 1998.
Changes in Financial Condition
The Partnership's primary sources of cash during the three months ended March
31, 1998 were from the operations of its investment properties and cash
distributions from joint ventures. The primary uses of cash during the same
period were for cash distributions to partners.
No further investment property acquisitions are planned by the General
Partners.
At March 31, 1998, the Partnership's total mortgage debt, including its
proportionate share of joint venture debt, was $3,392,800, consisting entirely
of variable rate debt. The average rate of interest on the variable rate debt
was 8.9% at March 31, 1998.
The future sources of cash for the Partnership will be provided from property
operations, cash reserves, and ultimately from the sale of property. The
future uses of cash will be for Partnership administration, capital
expenditures, distributions to partners and debt service. The General Partners
believe that the future sources of cash are sufficient to meet the working
capital requirements of the Partnership for the foreseeable future.
In 1997, the Partnership adopted Statement of Financial Accounting Standards
No. 128 (SFAS 128), "Earnings Per Share." This accounting standard specifies
new computation, presentation, and disclosure requirements for earnings per
share to be applied retroactively. Among other things, SFAS 128 requires
presentation of basic and diluted earnings per share on the face of the income
statement. The adoption of SFAS 128 had no effect on the per unit results
previously reported.
8
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PART II
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits and Index of Exhibits
(27) Financial Data Schedule
(b) Reports on Form 8-K
Form 8-K filed with the Commission on January 27, 1998.
Form 8-K/A filed with the Commission on February 3, 1998.
9
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SIGNATURE
In accordance with the requirements of the Exchange Act, the registrant 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: The Windsor Corporation, a California corporation
By /s/ Steven G. Waite
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STEVEN G. WAITE
President
Date: May 13, 1998
10
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 399,300
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 3,609,700
<DEPRECIATION> 990,900
<TOTAL-ASSETS> 5,356,900
<CURRENT-LIABILITIES> 94,000
<BONDS> 1,097,000
0
0
<COMMON> 0
<OTHER-SE> 4,165,900
<TOTAL-LIABILITY-AND-EQUITY> 5,356,900
<SALES> 0
<TOTAL-REVENUES> 168,100
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 116,900
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 26,400
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,800
<EPS-PRIMARY> 0.10
<EPS-DILUTED> 0.10
</TABLE>
