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, 1997 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, 1997 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, 1997 and December 31, 1996 3
Statements of Operations -
Three Months Ended March 31, 1997 and 1996 4
Statements of Cash Flows -
Three Months Ended March 31, 1997 and 1996 5
Statements of Partners' (Deficit) Capital -
Three Months Ended March 31, 1997 and 1996 6
Notes to Financial Statements 7 - 21
PART II: MANAGEMENT'S DISCUSSION & ANALYSIS OF
- -------------------------------------------------
FINANCIAL CONDITION & RESULTS OF
--------------------------------
OPERATIONS 22 - 23
----------
-2-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
BALANCE SHEETS
March 31, 1997 and December 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---- ----
<S> <C> <C>
ASSETS
- ------
Property, at cost:
Land and land improvements $ 2,116,448 $ 2,116,448
Buildings 16,624,484 16,614,849
Furniture and fixtures 1,101,500 1,101,500
------------ ------------
19,842,432 19,832,797
Less accumulated depreciation 5,482,075 5,289,574
------------ ------------
Property, net 14,360,357 14,543,223
Investments in real estate joint ventures 344,298 368,287
Accounts receivable 50,337 50,337
Prepaid commissions, net of accumulated amortization
of $48,859 and $45,867 13,454 16,446
Mortgage costs, net of accumulated amortization
of $287,146 and $268,186 72,885 76,845
Other assets 168,262 83,987
------------ ------------
Total Assets $ 15,009,593 $ 15,139,125
============ ============
LIABILITIES AND PARTNERS' CAPITAL
- ---------------------------------
Liabilities:
Cash overdraft $ 418,587 $ 181,074
Mortgages payable 9,556,151 9,573,161
Accounts payable and accrued expenses 477,010 617,877
Accounts payable - affiliates 44,489 0
Security deposits and prepaid rents 229,405 204,352
------------ ------------
Total Liabilities 10,725,642 10,576,464
------------ ------------
Partners' (Deficit) Capital:
General partners (273,259) (264,898)
Limited partners 4,557,210 4,827,559
------------ ------------
Total Partners' Capital 4,283,951 4,562,661
------------ ------------
Total Liabilities and Partners' Capital $ 15,009,593 $ 15,139,125
============ ============
</TABLE>
See notes to financial statements
-3-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
STATEMENTS OF OPERATIONS
Three Months Ended March 31, 1997 and 1996
(Unaudited)
Three Months Three Months
Ended Ended
March 31, March 31,
1997 1996
---- ----
Income:
Rental $ 884,889 $ 925,902
Interest and other income 89,036 86,671
----------- -----------
Total income 973,925 1,012,573
----------- -----------
Expenses:
Property operations 536,992 510,706
Interest 230,091 226,300
Depreciation and amortization 217,878 185,420
Administrative:
Paid to affiliates 93,350 60,545
Other 150,335 121,610
----------- -----------
Total expenses 1,228,646 1,104,581
----------- -----------
Loss before allocated loss from joint ventures (254,721) (92,008)
Allocated loss from joint ventures (23,989) (48,245)
----------- -----------
Net loss ($ 278,710) ($ 140,253)
=========== ===========
Loss per limited partnership unit ($ 1.72) ($ 0.86)
=========== ===========
Distributions per limited partnership unit $ 0.00 $ 0.00
=========== ===========
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, 1997 and 1996
(Unaudited)
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
March 31, March 31,
1997 1996
---- ----
<S> <C> <C>
Cash flow from operating activities:
Net loss ($278,710) ($140,253)
Adjustments to reconcile net loss to net cash
(used in) provided by operating activities:
Depreciation and amortization 217,878 185,420
Net loss from joint ventures 23,989 48,245
Changes in operating assets and liabilities:
Accounts receivable 0 (1,380)
Prepaid commissions 0 0
Other assets (87,700) (23,933)
Accounts payable and accrued expenses (140,867) 35,364
Security deposits and prepaid rent 25,053 (9,600)
--------- ---------
Net cash (used in) provided by operating activities (240,357) 93,863
--------- ---------
Cash flow from investing activities:
Accounts receivable - affiliates 0 1,281
Capital expenditures (9,635) (61,839)
Contributions to joint ventures, net of distributions 0 0
--------- ---------
Net cash (used in) investing activities (9,635) (60,558)
--------- ---------
Cash flows from financing activities:
Cash overdraft 237,513 (21,632)
Accounts payable - affiliates 44,489 0
Distributions to partners 0 0
Principal payments on mortgages (17,010) (11,673)
Mortgage costs (15,000) 0
--------- ---------
Net cash provided by (used in) financing activities 249,992 (33,305)
--------- ---------
Increase (decrease) in cash 0 0
Cash - beginning of period 0 0
--------- ---------
Cash - end of period $ 0 $ 0
========= =========
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest $ 230,091 $ 226,300
========= =========
</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, 1997 and 1996
(Unaudited)
General Limited Partners
Partners
Amount Units Amount
------ ----- ------
Balance, January 1, 1996 ($ 235,312) 157,377.9 $ 5,784,165
Net loss (4,208) 0 (136,045)
----------- --------- -----------
Balance, March 31, 1996 ($ 239,520) 157,377.9 $ 5,648,120
=========== ========= ===========
Balance, January 1, 1997 ($ 264,898) 157,377.9 $ 4,827,559
Net loss (8,361) 0 (270,349)
----------- --------- -----------
Balance, March 31, 1997 ($ 273,259) 157,377.9 $ 4,557,210
=========== ========= ===========
See notes to financial statements
-6-
<PAGE>
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP VI-A
NOTES TO FINANCIAL STATEMENTS
Three Months Ended March 31, 1997 and 1996
(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, 1997 and 1996,
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, 1997 and 1996.
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
(Countrybrook 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:
Countrybrook Estates (formerly West Creeke)
-------------------------------------------
A mortgage with a balance of $3,943,336 and $3,970,941 at March 31, 1997
and 1996, 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. The loan is secured by the Countrybrook Estates complex.
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, 1997 and
1996 loan advances amounted to $1,776,081 and $1,816,081, respectively. The
loan is secured by the Inducon-Columbia Office/Warehouse buildings.
Stonegate
---------
A mortgage with a balance of $1,958,116 and $1,978,895 at March 31, 1997
and 1996, 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. Management is currently looking for new financing for this
property.
-11-
<PAGE>
MORTGAGES AND NOTES PAYABLE (CONTINUED)
---------------------------------------
The Commons on Lewis Avenue
---------------------------
A mortgage with a balance of $1,878,618 and $1,895,000 at March 31, 1997
and 1996 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
---- ------
1997 $ 7,717,423
1998 20,930
1999 21,081
2000 22,920
2001 1,790,807
----------
TOTAL $ 9,573,161
===========
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 $55,121 and $30,030 for the three months ended March 31, 1997 and
1996, 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, 1997 or 1996.
-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, 1997 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 for both the three months ended March
31, 1997 and 1996, 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, 1997
and 1996 as reported in the statements of operations, and as would be
reported for tax purposes, is as follows:
March 31, March 31,
1997 1996
---- ----
Net loss - statement of operations $ (278,710) $ (140,253)
Add to (deduct from):
Difference in depreciation 27,364 36,086
Tax basis adjustments -
Joint Ventures 39,034 55,644
Allowance for doubtful accounts 30,101 14,449
----------- -----------
Net loss - tax return purposes $ (182,211) $ ( 34,074)
=========== ===========
The reconciliation of Partners' Capital as of March 31, 1997 and December
31, 1996 as reported in the balance sheet, and as reported for tax
purposes, is as follows:
March 31, December 31,
1997 1996
---- ----
Partners' Capital - balance sheet $ 4,283,951 $ 4,562,661
Add to (deduct from):
Accumulated difference in
depreciation 282,927 255,563
Tax basis adjustment -
Joint Ventures 909,567 870,533
Syndication fees 2,312,863 2,312,863
Other non-deductible expenses 421,308 391,207
------------ -----------
Partners' Capital - tax return purposes $ 8,210,616 $ 8,392,827
============ ===========
-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 Carriage House of Englewood (formerly 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, 1997 and December 31, 1996 and the
results of its operations for the three months ended March 31, 1997 and
1996 is as follows:
-15-
<PAGE>
CARRIAGE HOUSE OF ENGLEWOOD JOINT VENTURE
BALANCE SHEETS
March 31, 1997 and December 31, 1996
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---- ----
<S> <C> <C>
ASSETS
- ------
Property, at cost:
Land and land improvements $ 367,500 $ 367,500
Building 2,413,805 2,413,805
Building equipment 12,141 12,141
----------- -----------
2,793,446 2,793,446
Less accumulated depreciation 1,632,164 1,601,995
----------- -----------
Property, net 1,161,282 1,191,451
Escrow deposits 220,993 187,815
Other assets 541,415 573,634
----------- -----------
Total Assets $ 1,923,690 $ 1,952,900
=========== ===========
LIABILITIES AND PARTNERS' (DEFICIT)
- -----------------------------------
Liabilities:
Cash overdraft $ 235,596 $ 201,367
Mortgages payable 2,925,655 2,930,266
Accounts payable and accrued expenses 206,406 205,524
Deposits on sale 220,000 220,000
Accrued interest 21,942 21,977
Security deposits and prepaid rent 28,129 31,858
----------- -----------
Total Liabilities 3,637,728 3,610,992
----------- -----------
Partners' Capital (Deficit):
The Partnership 251,802 274,180
RPILP (1,965,840) (1,932,272)
----------- -----------
Total Partners' (Deficit) (1,714,038) (1,658,092)
----------- -----------
Total Liabilities and Partners' (Deficit) $ 1,923,690 $ 1,952,900
=========== ===========
</TABLE>
-16-
<PAGE>
CARRIAGE HOUSE OF ENGLEWOOD JOINT VENTURE
STATEMENTS OF OPERATIONS
Three Months Ended March 31, 1997 and 1996
Three Months Three Months
Ended Ended
March 31, March 31,
1997 1996
---- ----
Income:
Rental $ 157,082 $ 177,317
Interest and other income 10,420 7,928
--------- ---------
Total income 167,502 185,245
--------- ---------
Expenses:
Property operations 85,201 89,664
Interest 72,186 89,275
Depreciation and amortization 31,605 31,507
Administrative 34,456 43,478
--------- ---------
Total expenses 223,448 253,924
--------- ---------
Net loss ($ 55,946) ($ 68,679)
========= =========
Allocation of net loss:
The Partnership ($ 22,378) ($ 27,472)
RPILP (33,568) (41,207)
--------- ---------
($ 55,946) ($ 68,679)
========= =========
-17-
<PAGE>
INVESTMENT IN JOINT VENTURES (CONTINUED)
----------------------------------------
A reconciliation of the Partnership's investment in the joint venture is as
follows:
1997 1996
---- ----
Investment in joint venture, January 1 $ 274,180 $ 486,272
Allocation of net loss (22,378) (27,472)
----------- -----------
Investment in joint venture, March 31 $ 251,802 $ 458,800
========== ===========
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, 1997 and December 31, 1996 and the results of its operations for
the three months ended March 31, 1997 and 1996 is as follows:
-18-
<PAGE>
RESEARCH TRIANGLE INDUSTRIAL PARK JOINT VENTURES
BALANCE SHEETS
March 31, 1997 and December 31, 1996
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---- ----
<S> <C> <C>
ASSETS
- ------
Cash and cash equivalents $ 768,976 $ 745,127
Property, net of accumulated depreciation 1,492,258 1,601,125
Accounts receivable - other 0 268,317
Other assets 320,225 49,597
----------- -----------
Total Assets $ 2,581,459 $ 2,664,166
=========== ===========
LIABILITIES AND PARTNERS' (DEFICIT)
- -----------------------------------
Liabilities:
Notes payable $ 4,976,751 $ 4,996,884
Accounts payable and accrued expenses 50,670 96,440
Accounts payable - affiliates 23,822 37,406
----------- -----------
Total Liabilities 5,051,243 5,130,730
----------- -----------
Partners' (Deficit):
General partners (1,334,308) (1,332,697)
Other investors (1,135,477) (1,133,867)
----------- -----------
Total Partners' (Deficit) (2,469,785) (2,466,564)
----------- -----------
Total Liabilities and Partners' (Deficit) $ 2,581,459 $ 2,664,166
=========== ===========
</TABLE>
-19-
<PAGE>
RESEARCH TRIANGLE INDUSTRIAL PARK JOINT VENTURES
STATEMENTS OF OPERATIONS
Three Months Ended March 31, 1997 and 1996
Three Months Three Months
Ended Ended
March 31, March 31,
1997 1996
---- ----
Income:
Rental $ 246,104 $ 242,961
Interest and other income 1,448 140
--------- ---------
Total income 247,552 243,101
--------- ---------
Expenses:
Property operations 12,436 17,074
Interest 107,553 127,659
Depreciation and amortization 113,867 109,347
Administrative 16,917 30,568
--------- ---------
Total expenses 250,773 284,648
--------- ---------
Net loss ($ 3,221) ($ 41,547)
========= =========
Allocation of net loss:
The Partnership ($ 1,611) ($ 20,774)
RPILP II (1,610) (20,773)
--------- ---------
($ 3,221) ($ 41,547)
========= =========
-20-
<PAGE>
INVESTMENT IN JOINT VENTURES (CONTINUED)
----------------------------------------
A reconciliation of the Partnership's investment in the joint venture is as
follows:
1997 1996
---- ----
Investment in joint venture, January 1 $ 6,155 $ 60,907
Allocation of net loss ( 1,611) (20,774)
--------- ----------
Investment in joint venture, March 31 $ 4,544 $ 40,133
========= ==========
-21-
<PAGE>
PART II MANAGEMENT'S DISCUSSION AND ANALYSIS OF
- ------ ---------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
---------------------------------------------
Liquidity and Capital Resources:
- --------------------------------
The Partnership experienced a poor quarter from a cash flow point of view; the
cash flow deficiency from operations amounted to just over $240,000. Management
is concentrating on the implementation of controls over expenses, through closer
monitoring of payroll and other operating expenses, to balance the loss of
revenues which resulted in the first quarter of 1997 over that which management
had expected. More aggressive marketing campaigns are being put in place and
reinforced through routine/regular charting of which ads are successful in
attracting renters and through which sources the ads are bringing in the
traffic. Management also continues to offer attractive incentives to lease
properties whose occupancies fall below 90%. It is hoped that the combination of
strategies being followed by management will lead to the generation of higher
revenues, thus improving the cash flow of the Partnership.
There were no distributions made during the three month periods ended March 31,
1997 and 1996. The Partnership does not anticipate resuming distributions until
sufficient cash flow is generated to cover the Partnership's liabilities and set
up reserves for construction work which is necessary at several of the
residential complexes.
Results of Operations:
- ----------------------
Partnership operations for the three month period ended March 31, 1997 resulted
in a net loss of $278,710 or $1.72 per limited partnership unit versus a net
loss of $140,253 or $0.86 per limited partnership unit for the quarter ended
March 31, 1996.
The tax basis loss for the quarter ended March 31, 1997 amounted to $182,211 or
$1.12 per limited partnership unit. The tax loss for the three month period
ended March 31, 1996 totaled $34,074 or $0.21 per limited partnership unit.
Revenue for the three month period ended March 31, 1997 amounted to $973,925,
decreasing approximately $38,600 from the quarter ended March 31, 1996. A
decrease in rental revenue was solely responsible for the decrease in total
revenue when comparing the quarters ended March 31, 1997 and 1996. Interest and
other income increased slightly between the two quarters; the just over $2,300
increase can be primarily attributed to an increase in security deposits
forfeited. Lower occupancy at Countrybrook Estates and The Commons accounted for
much of the decrease in rental revenue; also responsible for the decrease are
substantially high concessions and discounts offered as a means of increasing
occupancy in the coming months.
-22-
<PAGE>
Results of Operations (continued):
- -----------------------------------
For the three month period ended March 31, 1997, total expenses were $1,228,646,
an increase of just over $124,000 from the same quarter in 1996. Property
operations expenditures increased approximately $26,000 between the two periods
due to increased repairs and maintenance costs, contracted services (an almost
35% increase can be noted due to higher costs associated with outside services
responsible for landscaping, painting, carpeting, etc.), and utilities. There
was a slight decrease in payroll and related expenses between the two quarters.
Management has been concentrating heavily on upgrading and better maintaining of
the complexes as cash flow permits in an effort to increase occupancy, as well
as to maintain current tenants. Interest expense remained relatively stable
between the quarters ended March 31, 1997 and 1996. Total administrative charges
increased just over $61,500 as legal fees (primarily due to collections),
portfolio management charges, investor service fees and brokerage fees
(primarily due to the efforts to sell Countrybrook Estates) all increased.
Management is confident that overall Partnership revenue will increase in future
periods. Occupancy throughout the Partnership, particularly at Beaver Creek,
Stonegate and Countrybrook Estates, should begin to escalate; the high occupancy
level at Inducon-Columbia is expected to remain constant in the coming months.
Total expenses, meanwhile, are anticipated to stay slightly ahead of previous
levels as the expected occupancy increases should ultimately lead to an increase
in several variable expenses, and as the repairs and maintenance work scheduled
is completed.
For the three month period ended March 31, 1997, the Gold Key Joint Venture
generated a net loss of $55,946, an improvement from the net loss of $68,679 for
the three month period ended March 31, 1996. Pursuant to the terms of the joint
venture agreement, the Partnership was allocated $22,378 of the loss in 1997 and
$27,472 of the loss in 1996.
The Research Triangle Industrial Park Joint Venture had a net loss of $3,221 for
the three month period ended March 31, 1997 with $1,611 of the loss allocated to
the Partnership. For the three month period ended march 31, 1996, the Joint
Venture had a net loss of $41,547 with $20,774 of the loss allocated to the
Partnership. The Research Triangle Office Complex continues to enjoy high
occupancy and positive cash flow.
-23-
<PAGE>
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
- -----------------------------------------
None.
-24-
<PAGE>
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 June 9, 1997
------------------------------ ------------------------
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 June 9, 1997
------------------------------ ------------------------
Joseph M. Jayson, Date
President and Director
/s/Michael J. Colmerauer June 9, 1997
------------------------------ ------------------------
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
THREE MONTHS ENDED MARCH 31, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 50,337
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 232,053
<PP&E> 19,842,432
<DEPRECIATION> 5,482,075
<TOTAL-ASSETS> 15,009,593
<CURRENT-LIABILITIES> 1,169,491
<BONDS> 9,556,151
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 15,009,593
<SALES> 0
<TOTAL-REVENUES> 973,925
<CGS> 0
<TOTAL-COSTS> 1,228,646
<OTHER-EXPENSES> 23,989
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 230,091
<INCOME-PRETAX> (278,710)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (278,710)
<EPS-PRIMARY> (1.72)
<EPS-DILUTED> 0
</TABLE>
