FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended Commission File Number
March 31, 1996 0-17466
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
(Exact Name of Registrant as specified in its charter)
Delaware 16-1309987
(State of Formation) (IRS Employer Identification Number)
2350 North Forest Road
Suite 12 A
Getzville, New York 14068
(Address of Principal Executive Office)
Registrant's Telephone Number: (716) 636-0280
Indicate by a 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 a 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 the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in part III of this Form 10-Q or any
amendment to this Form 10-Q. (X)
As of March 31, 1996 the registrant had 157,377.9 units of limited partnership
interest outstanding.
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
----------------------------------------------------
INDEX
-----
PAGE NO.
--------
PART I: FINANCIAL INFORMATION
- ------- ---------------------
Balance Sheets -
March 31, 1996 and December 31, 1995 3
Statements of Operations -
Three Months Ended March 31, 1996 and 1995 4
Statements of Cash Flows -
Three Months Ended March 31, 1996 and 1995 5
Statements of Partners' (Deficit) -
Three Months Ended March 31, 1996 and 1995 6
Notes to Financial Statements 7 - 21
PART II: MANAGEMENT'S DISCUSSION AND ANALYSIS OF
- -------- FINANCIAL CONDITION AND RESULTS OF OPERATIONS 22 - 23
---------------------------------------------
-2-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
BALANCE SHEETS
March 31, 1996 and December 31, 1995
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
------------ ------------
<S> <C> <C>
ASSETS
Property, at cost:
Land and land improvements $ 2,114,098 $ 2,114,098
Buildings 16,469,207 16,407,368
Furniture and fixtures 1,101,500 1,101,500
------------ ------------
19,684,805 19,622,966
Less accumulated depreciation 4,680,783 4,506,015
------------ ------------
Property, net 15,004,022 15,116,951
Investments in real estate joint ventures 498,932 547,177
Cash -- --
Accounts receivable 59,303 57,923
Accounts receivable - affiliate 347,746 349,027
Property acquisition costs capitalized -- --
Other assets 193,299 180,018
------------ ------------
Total Assets $ 16,103,302 $ 16,251,096
============ ============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Cash overdraft $ 153,287 $ 174,919
Mortgages payable 9,660,917 9,672,590
Accounts payable and accrued expenses 717,284 681,920
Security deposits and prepaid rents 163,214 172,814
------------ ------------
Total Liabilities 10,694,702 10,702,243
------------ ------------
Partners' (Deficit) Capital:
General partners (239,520) (235,312)
Limited partners 5,648,119 5,784,165
------------ ------------
Total Partners' Capital 5,408,600 5,548,853
------------ ------------
Total Liabilities and Partners' Capital $ 16,103,302 $ 16,251,096
============ ============
</TABLE>
See notes to financial statements
-3-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
STATEMENTS OF OPERATIONS
Three Months Ended March 31, 1996 and 1995
(Unaudited)
Three Months Three Months
Ended Ended
March 31, March 31,
1996 1995
----------- -----------
Income:
Rental $ 925,902 $ 1,007,702
Interest and other income 86,671 51,763
----------- -----------
Total income 1,012,573 1,059,465
----------- -----------
Expenses:
Property operations 510,706 619,441
Interest 226,300 230,883
Depreciation and amortization 185,420 203,578
Administrative:
Paid to affiliates 60,545 98,661
Other 121,610 117,369
----------- -----------
Total expenses 1,104,581 1,269,932
----------- -----------
Loss before allocated loss from joint ventures (92,008) (210,467)
Allocated loss from joint ventures (48,245) (20,635)
----------- -----------
Net loss $ (140,253) $ (231,102)
=========== ===========
Loss per limited partnership unit $ (0.86) $ (1.42)
=========== ===========
Distributions per limited partnership unit $ -- $ --
=========== ===========
Weighted average number of
limited partnership units
outstanding 157,378 157,378
=========== ===========
See notes to financial statements
-4-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
STATEMENTS OF CASH FLOWS
Three Months Ended March 31, 1996 and 1995
(Unaudited)
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
March 31, March 31,
1996 1995
--------- ---------
<S> <C> <C>
Cash flow from operating activities:
Net loss $(140,253) $(231,102)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation and amortization 185,420 203,578
Net loss from joint ventures 48,245 20,635
Changes in operating assets and liabilities:
Accounts receivable (1,380) 8,926
Other assets (23,933) (58,342)
Accounts payable and accrued expenses 35,364 13,915
Security deposits and prepaid rent (9,600) 2,729
--------- ---------
Net cash provided by (used in) operating activities 93,863 (39,661)
--------- ---------
Cash flow from investing activities:
Accounts receivable - affiliates 1,281 163,144
Capital expenditures (61,839) (220,497)
Contributions to joint ventures, net of distributions -- --
--------- ---------
Net cash (used in) investing activities (60,558) (57,353)
--------- ---------
Cash flows from financing activities:
Cash overdraft (21,632) --
Distributions to partners -- --
Principal payments on mortgages (11,673) (3,511)
Mortgage proceeds -- --
--------- ---------
Net cash (used in) financing activities (33,305) (3,511)
--------- ---------
Increase (decrease) in cash -- (100,525)
Cash - beginning of period -- 118,039
--------- ---------
Cash - end of period $ -- $ 17,514
========= =========
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest $ 226,300 $ 230,883
========= =========
</TABLE>
See notes to financial statements
-5-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
STATEMENTS OF PARTNERS' (DEFICIT) CAPITAL
Three Months Ended March 31, 1996 and 1995
(Unaudited)
General Limited Partners
Partners
Amount Units Amount
Balance, January 1, 1995 $ (196,105) 157,377.9 $ 7,051,862
Net loss (6,933) -- (224,169)
----------- --------- -----------
Balance, March 31, 1995 $ (203,038) 157,377.9 $ 6,827,693
=========== ========= ===========
Balance, January 1, 1996 $ (235,312) 157,377.9 $ 5,784,165
Net loss (4,208) -- (136,046)
----------- --------- -----------
Balance, March 31, 1996 $ (239,520) 157,377.9 $ 5,648,119
=========== ========= ===========
See notes to financial statements
-6-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
NOTES TO FINANCIAL STATEMENTS
Three Months Ended March 31, 1996 and 1995
(Unaudited)
1. GENERAL PARTNERS' DISCLOSURE
In the opinion of the General Partners of Realmark Property Investors
Limited Partnership VI-A, all adjustments necessary for a fair presentation
of the Partnership's financial position, results of operations and changes in
cash flows for the three month periods ended March 31, 1996 and 1995, have
been made in the financial statements. Such financial statements are
unaudited and subject to any year-end adjustments which may be necessary.
2. FORMATION AND OPERATION OF PARTNERSHIP
Realmark Property Investors Limited Partnership VI-A (the "Partnership"), a
Delaware Limited Partnership, was formed on September 21, 1987, to invest in
a diversified portfolio of income-producing real estate investments.
In November 1987, the Partnership commenced the public offering of units of
limited partnership interest. Other than matters relating to organization, it
had no business activities and, accordingly, had not incurred any expenses or
earned any income until the first interim closing (minimum closing) of the
offering, which occurred on February 12, 1988. The offering was concluded on
November 10, 1988, at which time 157,377.9 units of limited partnership
interest were sold and outstanding, including 30 units held by an affiliate
of the General Partners. The offering terminated on November 10, 1988 with
gross offering proceeds of $15,737,790. The General Partners are Realmark
Properties, Inc., a wholly-owned subsidiary of J.M. Jayson & Company, Inc.
and Joseph M. Jayson, the Individual General Partner. Joseph M. Jayson is the
sole shareholder of J.M. Jayson & Company, Inc.
Under the partnership agreement, the general partners and their affiliates
can receive compensation for services rendered and reimbursement for expenses
incurred on behalf of the Partnership.
-7-
<PAGE>
FORMATION AND OPERATION OF PARTNERSHIP (CONTINUED)
Net income or loss and proceeds arising from a sale or refinancing shall be
distributed first to the limited partners in amounts equivalent to a 7%
return on the average of their adjusted capital contributions, then an amount
equal to their capital contributions, then an amount equal to an additional
5% of the average of their adjusted capital contributions after the general
partners receive a 3% property disposition fee. Such fees shall be reduced,
but not below zero, by the amounts necessary to pay to limited partners whose
subscriptions were accepted by January 31, 1988, an additional cumulative
annual return (not compounded) equal to 2% based on their average adjusted
capital contributions, and to limited partners whose subscriptions were
accepted between February 1, 1988 and June 30, 1988, an additional cumulative
annual return (not compounded) equal to 1% based on their average adjusted
capital contributions commencing with the first fiscal quarter following the
termination of the offering of units, then to all partners in an amount equal
to their respective positive capital balances, and finally, in the ratio of
87% to the limited partners and 13% to the general partners.
The partnership agreement also provides that distribution of funds,
revenues, costs and expenses arising from partnership activities, exclusive
of any sale or refinancing activities, are to be allocated 97% to the limited
partners and 3% to the general partners.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash
----
For purposes of reporting cash flows, cash includes the following items:
cash on hand; cash in checking; and money market savings.
Property and Depreciation
-------------------------
Depreciation is provided using the straight-line method over the estimated
useful lives of the respective assets. Expenditures for maintenance and
repairs are expensed as incurred, and major renewals and betterments are
capitalized. The Accelerated Cost Recovery System and Modified Accelerated
Cost Recovery System are used to determine depreciation expense for tax
purposes.
-8-
<PAGE>
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Acquisition Fees
----------------
Acquisition fees are paid to the general partner as properties are
specified, which generally occurs when a contract to purchase the property is
entered into. Acquisition fees are allocated to specific properties when
actual closing takes place. Acquisition fees paid for properties that
ultimately are not acquired will be applied toward other properties that are
acquired or reallocated to existing properties.
Unconsolidated Joint Ventures
-----------------------------
The Partnership's investment in affiliated real estate joint ventures are
accounted for on the equity method.
Rental Income
-------------
Leases for residential properties have terms of one year or less. Commercial
leases generally have terms ranging from one to five years. Rental income is
recognized on the straight line method over the term of the lease.
Rents Receivable
----------------
Due to the nature of these accounts, residential rents receivable are fully
reserved as of March 31, 1996 and 1995.
4. ACQUISITION AND DISPOSITION OF RENTAL PROPERTY
Inducon Joint Venture - Columbia (the "Venture") was formed pursuant to an
agreement dated March 16, 1988 between the Partnership and Trion Development
Group, Inc., a New York corporation (the "Corporation"). The primary purpose
of the Venture was to acquire and lease land and construct office/warehouse
buildings as income producing property. The Partnership contributed initial
capital to the Venture of $1,064,950, which was used to fund the development
costs. On May 19, 1989 the Partnership purchased the minority venturer's
interest in the Inducon Joint Venture - Columbia for $130,000. The office
complex, located in Columbia, South Carolina, consists of four (4) buildings.
The first phase was placed in service in July 1989 and has a total cost of
$1,793,276, which includes $311,358 in acquisition fees. The second phase was
put in service in December 1991 and has a total cost of $1,815,206, which
includes $48,796 of capitalized interest.
-9-
<PAGE>
ACQUISITION AND DISPOSITION OF RENTAL PROPERTY (CONTINUED)
In February 1989 the Partnership acquired an 80 unit apartment complex
(Beaver Creek) located in Beaver County, Pennsylvania for a purchase price of
$1,872,887, which included $347,404 in acquisition fees.
In June 1989 the Partnership acquired a 240 unit apartment complex
(Countrybrooke Estates, formerly West Creeke) located in Louisville, Kentucky
for a purchase price of $5,670,984, which included $334,285 in acquisition
fees.
In March 1990 the Partnership purchased a 131 unit apartment complex
(Stonegate) located in Mobile, Alabama for a purchase price of $4,145,367,
which included $225,620 in acquisition fees.
In March 1991 the Partnership purchased a 230 unit apartment complex (The
Commons on Lewis Avenue, formerly Williamsburg Commons) located in Tulsa,
Oklahoma for a purchase price of $2,965,803, which included $269,721 in
acquisition fees.
In September 1991 the Partnership entered into an agreement and formed a
joint venture with Realmark Property Investors Limited Partnership II and
VI-B (RPILP II and VI-B) for the purpose of operating the 250 unit Foxhunt
Apartments in Kettering, Ohio and owned by RPILP II. In April 1992 the
Partnership's capital contribution of $389,935 plus interest was returned by
RPILP II and the Partnership's interest in the joint venture ended.
In May 1992 the Partnership entered into an agreement to form a joint
venture with Realmark Property Investors Limited Partnership (RPILP) for the
purpose of operating the 144 unit Gold Key Apartments located in Englewood,
Ohio and owned by RPILP.
In August 1992 the Partnership entered into a joint venture agreement for
the purpose of operating Research Triangle Industrial Park West, a 150,000
square foot office/warehouse facility located in Durham, North Carolina. The
original joint venture agreement to develop and operate the property, created
between Realmark Property Investors Limited Partnership II (RPILP II) and
Adaron Group (Adaron), was dissolved, and the Partnership acquired all rights
held by Adaron.
-10-
<PAGE>
5. MORTGAGES AND NOTES PAYABLE
In connection with the acquisition of rental property, the Partnership
obtained mortgages as follows:
Countrybrooke Estates (formerly West Creeke)
--------------------------------------------
A mortgage with a balance of $3,970,941 and $3,996,000 at March 31, 1996 and
1995, respectively, bearing interest at 9.75%. The mortgage provides for
annual principal and interest payments of $413,568 payable in equal monthly
installments with a final payment of $3,964,286 due on July 1, 1996.
Inducon - Columbia
------------------
On July 27, 1989 a construction loan was approved. Interest on the amount
advanced is at the prime rate, as announced by Nations Bank, plus 1.25%.
Interest is payable in monthly installments commencing the first month
following the first advance, and continuing until July 10, 1994. On that date
the Partnership had the option of purchasing two one-year extensions by
paying, at the time of each extension, a fee equal to one-half of one percent
of the then outstanding principal balance. The Partnership exercised both of
its options, and has extended the due date to July 10, 1996. On July 26, 1993
the construction loan was restructured to allow up to $500,000 to be advanced
solely for tenant upfit expenses. All terms under the original agreement are
still in effect. As of March 31, 1996 and 1995 loan advances amounted to
$1,816,081 and $1,748,556, respectively.
Stonegate
---------
A mortgage with a balance of $1,978,895 and $1,998,226 at March 31, 1996 and
1995, respectively. The mortgage provided for monthly principal and interest
payments of $18,800 through March 31, 1994. On April 1, 1994 the interest
rate changed to 1% over the corporate base rate charged by the Boatman's
National Bank. Monthly payments from April 1, 1994 through maturity on March
1, 1997 will equal $1,726 in principal plus accrued interest. A final payment
of $1,960,592 plus accrued interest is due April 1, 1997.
-11-
<PAGE>
MORTGAGES AND NOTES PAYABLE (CONTINUED)
The Commons on Lewis Avenue (formerly Williamsburg Commons)
-----------------------------------------------------------
A mortgage with a balance of $1,895,000 at March 31, 1996 and 1995 obtained
at the time of purchase, providing for monthly interest only payments ranging
from 8% to 12% annually. Principal and interest payments are to begin May
1996 with an effective interest rate of 10% per the loan agreement. The
entire principal balance, plus accrued interest, is due and payable April 1,
2001.
The mortgages described above are secured by the individual properties to
which they relate.
The aggregate maturities of mortgages payable for each of the next five
years and thereafter are as follows:
Year Amount
---- ------
1996 $ 5,814,229
1997 1,963,361
1998 0
1999 0
2000 0
Thereafter 1,895,000
----------
TOTAL $ 9,672,590
===========
6. RELATED PARTY TRANSACTIONS
Management fees for the management of certain of the Partnership's
properties are paid to an affiliate of the General Partners. The management
agreement provides for 5% of gross monthly receipts of the complexes to be
paid as fees for administering the operations of the properties. These fees
totaled $ 30,030 and $ 48,975 for the three months ended March 31, 1996 and
1995, respectively.
According to the terms of the Partnership Agreement, the General Partner is
also entitled to receive a partnership management fee equal to 7% of net cash
flow (as defined in the Partnership Agreement), 2% of which is subordinated
to the limited partners having received an annual cash return equal to 7% of
their adjusted capital contributions. There were no such fees paid or accrued
for the three months ended March 31, 1996 or 1995.
-12-
<PAGE>
RELATED PARTY TRANSACTIONS (CONTINUED)
The general partners are also allowed to collect a property disposition fee
upon the sale of acquired properties. This fee is not to exceed the lesser of
50% of amounts customarily charged in arm's-length transactions by others
rendering similar services for comparable properties, or 3% of the sales
price. The property disposition fee is subordinate to payments to the limited
partners of a cumulative annual return (not compounded) equal to 7% of their
average adjusted capital balances and to repayment to the limited partners of
an amount equal to their original capital contributions. No properties have
been sold as of March 31, 1996 and accordingly, there have been no property
disposition fees paid or earned by the general partner.
Pursuant to the terms of the Partnership agreement, the corporate general
partner charges the Partnership for reimbursement of certain costs and
expenses incurred by the corporate general partner and its affiliates in
connection with the administration of the Partnership and acquisition of
properties. These charges are for the Partnership's allocated share of such
costs and expenses as payroll, travel, communication costs related to
partnership accounting, partner communication and relations, and acquisition
of properties. Partnership accounting, communication, marketing and
acquisition expenses are allocated based on total assets, number of partners
and number of units, respectively.
Computer service charges for the partnerships are paid or accrued to an
affiliate of the General Partner. The fee is based upon the number of
apartment units and totaled $2,640 and $2,640 for the three months ended
March 31, 1996 and 1995, respectively.
7. INCOME TAXES
No provision has been made for income taxes since the income or loss of the
partnership is to be included in the tax returns of the Individual Partners.
The tax returns of the Partnership are subject to examination by the Federal
and state taxing authorities. Under federal and state income tax laws,
regulations and rulings, certain types of transactions may be accorded
varying interpretations and, accordingly, reported partnership amounts could
be changed as a result of any such examination.
-13-
<PAGE>
INCOME TAXES (CONTINUED)
The reconciliation of net loss for the three months ended March 31, 1996 and
1995 as reported in the statements of operations, and as would be reported
for tax purposes, is as follows:
March 31, March 31,
1996 1995
---- ----
Net loss - statement of operations $ (140,253) $ (231,102)
Add to (deduct from):
Difference in depreciation 36,086 20,030
Tax basis adjustments -
Joint Ventures 55,644 43,500
Allowance for doubtful accounts 14,449 14,232
----------- -----------
Net loss - tax return purposes $ ( 34,074) $ (153,340)
=========== ============
The reconciliation of Partners' Capital as of March 31, 1996 and December
31, 1995 as reported in the balance sheet, and as reported for tax purposes,
is as follows:
March 31, December 31,
1996 1995
---- ----
Partners' Capital - balance sheet $ 5,408,600 $ 5,548,853
Add to (deduct from):
Accumulated difference in
depreciation 182,192 146,106
Tax basis adjustment -
Joint Ventures 770,043 714,399
Syndication fees 2,312,863 2,312,863
Other non-deductible expenses 285,251 270,802
------------ ------------
Partners' Capital - tax return purposes $ 8,958,949 $ 8,993,023
============ ============
-14-
<PAGE>
8. INVESTMENT IN JOINT VENTURES
On September 27, 1991 the Partnership entered into an agreement to form a
joint venture with Realmark Property Investors Limited Partnership II (RPILP
II) and Realmark Property Investors Limited Partnership VI-B (RPILP VI-B).
The joint venture was formed for the purpose of operating the Foxhunt
Apartments located in Dayton, Ohio and owned by RPILP II. Under the terms of
the original agreement, the Partnership contributed $390,000 and RPILP VI-B
contributed $1,041,568 to buy out the wraparound promissory note on the
property. RPILP II contributed the property net of the first mortgage.
On April 1, 1992 the Partnership's interest in the joint venture was bought
out by RPILP II for $389,935 plus accrued interest at 15%. The joint venture
agreement had provided that any income, loss, gain, cash flow or sale
proceeds be allocated 63.14% to RPILP II, 10.04% to the Partnership, and
26.82% to RPILP VI-B. The allocated net loss of the joint venture from the
date of inception through April 1, 1992 was accounted for on the equity
method due to the general partner's active relationship with each venturer.
On May 5, 1992 the Partnership entered into an agreement to form a joint
venture with Realmark Property Investors Limited Partnership (RPILP) for the
purpose of operating the Gold Key Apartments located in Englewood, Ohio and
owned by RPILP. Under the terms of the original joint venture agreement, the
Partnership contributed $497,912 and RPILP contributed the property net of
the outstanding mortgage.
On March 1, 1993 the Partnership contributed an additional $125,239, in the
process increasing its ownership percentage in the joint venture. The joint
venture agreement had provided that any income, loss, gain, cash flow or sale
proceeds be allocated 68% to RPILP and 32% to the Partnership. The additional
1993 capital contribution changed the allocation to 60% and 40%,
respectively.
Due to the general partner's active relationship with each venturer, the
Partnership accounts for its interest on the equity method. The equity
ownership has been determined based upon the cash paid into the general
partner's estimate of the fair market value of the apartment complex and
other assets at the date of inception.
A summary of the assets, liabilities and partners' capital (deficiency) of
the joint venture as of March 31, 1996 and December 31, 1995 and the results
of its operations for the three months ended March 31, 1996 and 1995 is as
follows:
-15-
<PAGE>
GOLD KEY APARTMENTS JOINT VENTURE
BALANCE SHEETS
March 31, 1996 and December 31, 1995
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
----------- -----------
<S> <C> <C>
ASSETS
Property, at cost:
Land and land improvements $ 367,500 $ 367,500
Building 2,404,785 2,404,785
Building equipment 12,141 12,141
----------- -----------
2,784,426 2,784,426
Less accumulated depreciation 1,561,778 1,531,705
----------- -----------
Property, net 1,222,648 1,252,721
Cash -- 28,101
Escrow deposits 309,438 277,523
Other assets 788,402 797,919
----------- -----------
Total Assets $ 2,320,488 $ 2,356,264
=========== ===========
LIABILITIES AND PARTNERS' (DEFICIT)
Liabilities:
Cash overdraft $ 136,059 $ --
Mortgages payable 2,943,495 2,947,711
Accounts payable and accrued expenses 600,504 702,735
Accrued interest 22,097 22,108
Security deposits and prepaid rent 46,012 42,710
----------- -----------
Total Liabilities 3,748,167 3,715,264
----------- -----------
Partners' Capital (Deficit):
The Partnership 366,345 393,817
RPILP (1,794,024) (1,752,817)
----------- -----------
Total Partners' (Deficit) (1,427,679) (1,359,000)
----------- -----------
Total Liabilities and Partners' (Deficit) $ 2,320,488 $ 2,356,264
=========== ===========
</TABLE>
-16-
<PAGE>
GOLD KEY APARTMENTS JOINT VENTURE
STATEMENTS OF OPERATIONS
Three Months Ended March 31, 1996 and 1995
Three Months Three Months
Ended Ended
March 31, March 31,
1996 1995
--------- ---------
Income:
Rental $ 177,317 $ 175,558
Interest and other income 7,928 10,025
--------- ---------
Total income 185,245 185,583
--------- ---------
Expenses:
Property operations 89,664 94,208
Interest 89,275 66,654
Depreciation and amortization 31,507 30,808
Administrative 43,478 34,098
--------- ---------
Total expenses 253,924 225,768
--------- ---------
Net loss $ (68,679) $ (40,185)
========= =========
Allocation of net loss:
The Partnership $ (27,472) $ (16,074)
RPILP (41,207) (24,111)
--------- ---------
$ (68,679) $ (40,185)
========= =========
-17-
<PAGE>
INVESTMENT IN JOINT VENTURES (CONTINUED)
A reconciliation of the Partnership's investment in the joint venture is as
follows:
1996 1995
---- ----
Investment in joint venture, January 1 $ 486,272 $ 582,605
Allocation of net loss (27,472) (16,074)
---------- ----------
Investment in joint venture, March 31 $ 458,800 $ 566,531
On August 20, 1992 the Partnership entered into a joint venture agreement
for the purpose of operating Research Triangle Industrial Park West, an
office/warehouse facility located in Durham, North Carolina. The original
joint venture agreement to develop and operate the property created between
Realmark Property Investors Limited Partnership II (RPILP II) and Adaron
Group (Adaron) was dissolved, and the Partnership acquired Adaron's interest
in the joint venture. In the transaction, the Partnership paid $575,459 to
Adaron and acquired all rights previously held by Adaron. The agreement
provides for 50% of any income or loss to be allocated to both the
Partnership and RPILP II.
A summary of the assets, liabilities and equity of the joint venture as of
March 31, 1996 and December 31, 1995 and the results of its operations for
the three months ended March 31, 1996 and 1995 is as follows:
-18-
<PAGE>
RESEARCH TRIANGLE INDUSTRIAL PARK JOINT VENTURES
BALANCE SHEETS
March 31, 1996 and December 31, 1995
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
----------- -----------
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 192,576 $ 92,150
Property, net of accumulated depreciation 2,330,747 2,439,455
Accounts receivable - affiliates 321,073 322,212
Other assets 430,708 461,237
----------- -----------
Total Assets $ 3,275,104 $ 3,315,054
=========== ===========
LIABILITIES AND PARTNERS' (DEFICIT)
Liabilities:
Notes payable $ 5,054,838 $ 5,073,225
Accounts payable and accrued expenses 189,649 169,665
----------- -----------
Total Liabilities 5,244,487 5,242,890
----------- -----------
Partners' (Deficit):
General partners (885,277) (864,503)
Other investors (1,084,107) (1,063,333)
----------- -----------
Total Partners' (Deficit) (1,969,383) (1,927,836)
----------- -----------
Total Liabilities and Partners' (Deficit) $ 3,275,104 $ 3,315,054
=========== ===========
</TABLE>
-19-
<PAGE>
RESEARCH TRIANGLE INDUSTRIAL PARK JOINT VENTURES
STATEMENTS OF OPERATIONS
Three Months Ended March 31, 1996 and 1995
Three Months Three Months
Ended Ended
March 31, March 31,
1996 1995
--------- ---------
Income:
Rental $ 242,961 $ 267,853
Interest and other income 140 80
--------- ---------
Total income 243,101 267,933
--------- ---------
Expenses:
Property operations 17,074 25,474
Interest 127,659 110,781
Depreciation and amortization 109,347 126,916
Administrative 30,568 13,884
--------- ---------
Total expenses 284,648 277,055
--------- ---------
Net loss $ (41,547) $ (9,122)
========= =========
Allocation of net loss:
The Partnership $ (20,774) $ (4,561)
RPILP II (20,774) (4,561)
--------- ---------
$ (41,547) $ (9,122)
========= =========
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INVESTMENT IN JOINT VENTURES (CONTINUED)
A reconciliation of the Partnership's investment in the joint venture is as
follows:
1996 1995
---- ----
Investment in joint venture, January 1 $ 60,907 $ 263,046
Allocation of net loss (20,774) ( 4,561)
----------- -----------
Investment in joint venture, March 31 $ 40,133 $ 258,485
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PART II MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Liquidity and Capital Resources:
- --------------------------------
The Partnership continues to have cash flow difficulties, although occupancy at
Inducon is now at 97.5%. The Partnership has been utilizing cash to fund the
operations as well as utilizing funds for property improvements throughout the
Partnership. Management will continue its emphasis on raising revenue while
cutting expenditures.
The Partnership is currently in the process of refinancing Inducon Columbia. The
current construction loan comes due on July 1, 1996, however, the current
mortgage holder has agreed to extend the mortgage for nine months until April 1,
1997.
There were no distributions made during the three month periods ended March 31,
1996 and 1995. The Partnership does not anticipate resuming distributions until
sufficient cash flow is able to be generated.
Results of Operations:
- ----------------------
Partnership operations for the three month period ended March 31, 1996 resulted
in a net loss of $140,253 or $0.86 per limited partnership unit versus a net
loss of $231,102 or $1.42 per limited partnership unit for the quarter ended
March 31, 1995.
The tax basis loss for the quarter ended March 31, 1996 amounted to $34,074 or
$0.21 per limited partnership unit. The tax loss for the three month period
ended March 31, 1995 totaled $153,340 or $0.95 per limited partnership unit.
Revenue for the three month period ended March 31, 1996 amounted to $1,012,573,
decreasing approximately $47,000 from the quarter ended March 31, 1995. Total
rental revenue dropped slightly less than $82,000, while interest and other
income increased approximately $35,000. Lower occupancy at most properties
within this Partnership accounted for much of the decrease in rental revenue,
while the increase in interest and other income between the two periods is due
to increased laundry income, forfeited security deposits and month to month
surcharges.
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<PAGE>
For the three month period ended March 31, 1996, total expenses were $1,104,581,
dropping just over $165,000 from the quarter ended March 31, 1995. Property
operations expenditures increased approximately $109,000 between the two periods
due to increased payroll, repairs, maintenance, contracted services, utilities,
property insurance and real estate taxes. Total administrative charges decreased
about $34,000 as legal fees, credit check costs, accounting and audit fees,
property management fees, and portfolio management charges all decreased. Total
interest expense meanwhile, dropped roughly $4,000 due to the lower debt service
payments associated with the mortgages at Stonegate, The Commons and Inducon
Columbia.
Management is confident that overall Partnership revenue will increase in future
periods. Occupancy throughout the Partnership, particularly at Inducon Columbia
and Countrybrooke Estates (formerly West Creeke), should begin to escalate,
leading management to anticipate an approximate 3% jump in total revenue. Total
expenses, meanwhile, should continue to stay slightly ahead of previous levels
as the expected occupancy increases should ultimately lead to a jump in several
variable expenses.
For the three month period ended March 31, 1996, the Gold Key Joint Venture
generated a net loss of $68,679 versus a net loss of $40,185 for the three month
period ended March 31, 1995. Pursuant to the terms of the joint venture
agreement, the Partnership was allocated $27,472 of the loss in 1996 and $16,074
of the loss in 1995.
The Research Triangle Industrial Park Joint Venture had a net loss of $41,547
for the three month period ended March 31, 1996 with $20,774 of the loss
allocated to the Partnership. For the three month period ended march 31, 1995,
the Joint Venture had a net loss of $9,122 with $4,561 of the loss allocated to
the Partnership.
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REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
----------------------------------------------------
PART II
-------
OTHER INFORMATION
-----------------
Item 1 - Legal Proceedings
- --------------------------
The Partnership is not party to, nor is it the subject of, any material pending
legal proceedings other than ordinary routine litigation incidental to the
Partnership's business.
Item 2, 3, 4 and 5
- ------------------
Not applicable.
Item 6 - Exhibits and Reports on Form 8-K
- -----------------------------------------
Exhibit 27 - Financial Data Schedule (Electronic filing only)
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SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
REALMARK PROPERTY INVESTORS
LIMITED PARTNERSHIP VI-A
By: /s/Joseph M. Jayson July 12, 1996
------------------------------ ------------------------
Joseph M. Jayson, Date
Individual General Partner
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
By: REALMARK PROPERTIES, INC.
Corporate General Partner
/s/Joseph M. Jayson July 12, 1996
------------------------------ ------------------------
Joseph M. Jayson, Date
President and Director
/s/Michael J. Colmerauer July 12, 1996
------------------------------ ------------------------
Michael J. Colmerauer Date
Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A FOR
THE QUARTER ENDED MARCH 31, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 407,049
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0
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