UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
---------------------------------------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
------------------- --------------------
Commission file number
0-17626
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
and
FFCA INVESTOR SERVICES CORPORATION 88-B
- --------------------------------------------------------------------------------
(Exact Name of Co-Registrants as Specified in Their
Organizational Documents)
Delaware 86-0588512
- --------------------------------------------------------------------------------
(Partnership State of Organization) (Partnership I.R.S. Employer
Identification Number)
Delaware 86-0588514
- --------------------------------------------------------------------------------
(Corporation State of Incorporation) (Corporation I.R.S. Employer
Identification Number)
The Perimeter Center
17207 North Perimeter Drive
Scottsdale, Arizona 85255
- --------------------------------------------------------------------------------
(Address of principal executive offices) (zip code)
Co-Registrants' telephone number including area code (602) 585-4500
-------------------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----- ------
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item l. Financial Statements.
------- ---------------------
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
BALANCE SHEETS
MARCH 31, 1997 AND DECEMBER 31, 1996
(Unaudited)
March 31, December 31,
1997 1996
----------- -----------
ASSETS
------
CASH AND CASH EQUIVALENTS $ 4,072,207 $ 2,418,201
----------- -----------
LAND:
Held for Sale 24,182,813 26,326,289
Subject to Sale Agreements 3,359,709 2,980,166
Subject to Sale Agreement With Affiliate 788,287 788,287
----------- -----------
Total land 28,330,809 30,094,742
----------- -----------
LOAN RECEIVABLE FROM AFFILIATE 7,598,415 7,598,415
PREPAID EXPENSES AND OTHER 214,623 148,293
----------- -----------
Total assets $40,216,054 $40,259,651
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
DISTRIBUTION PAYABLE TO LIMITED PARTNERS $ 2,667,728 $ 939,956
PAYABLE TO GENERAL PARTNER 58,008 58,481
ACCOUNTS PAYABLE AND ACCRUED EXPENSES 170,232 160,927
------------ ------------
Total liabilities 2,895,968 1,159,364
------------ ------------
PARTNERS' CAPITAL (DEFICIT):
General partner(12,692) (12,529)
Limited partners 37,332,778 39,112,816
------------ ------------
Total partners' capital 37,320,086 39,100,287
------------ ------------
Total liabilities and partners' capital $ 40,216,054 $ 40,259,651
============ ============
<PAGE>
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(Unaudited)
1997 1996
----------- -----------
REVENUES:
Land sales $ 2,894,380 $ 3,569,700
Interest on loan to affiliate 212,500 212,500
Interest on investments and other 37,208 58,491
----------- -----------
3,144,088 3,840,691
----------- -----------
EXPENSES:
Cost of land sales 1,991,042 2,067,511
General partner fees 89,258 93,750
Property management fees 9,000 9,000
Marketing 3,720 28,372
Property taxes 44,465 43,626
Other operating 119,532 77,745
----------- -----------
2,257,017 2,320,004
----------- -----------
NET INCOME $ 887,071 $ 1,520,687
=========== ===========
NET INCOME ALLOCATED TO:
General partner $ (163) $ 185
Limited partners 887,234 1,520,502
----------- -----------
$ 887,071 $ 1,520,687
=========== ===========
NET INCOME PER LIMITED PARTNERSHIP UNIT
(based on 50,000 units held by limited partners) $ 17.74 $ 30.41
=========== ===========
<PAGE>
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
FOR THE THREE MONTHS ENDED MARCH 31, 1997
(Unaudited)
<TABLE>
<CAPTION>
Limited Partners
General ---------------------------
Partner Number Total
Amount of Units Amount Amount
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
BALANCE, December 31, 1996 $ (12,529) 50,000 $ 39,112,816 $ 39,100,287
Net Income (loss) (163) -- 887,234 887,071
Distribution to
Limited Partners -- -- (2,667,272) (2,667,272)
------------ ------------ ------------ ------------
BALANCE, March 31, 1997 $ (12,692) 50,000 $ 37,332,778 $ 37,320,086
============ ============ ============ ============
</TABLE>
<PAGE>
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 887,071 $ 1,520,687
Adjustments to net income:
Change in assets and liabilities:
Decrease in land held for sale 2,143,476 --
Decrease (increase) in land subject to sales agreements (379,543) 2,016,693
Decrease (increase) in prepaid expenses and other (66,330) 45,187
Increase (decrease) in payable to general partner (473) 35,403
Increase (decrease) in accounts payable and
accrued liabilities 9,305 (28,826)
----------- -----------
Net cash provided by operating activities 2,593,506 3,589,144
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Limited partner distributions declared (2,667,272) --
Increase in distribution payable 1,727,772 --
----------- -----------
Net cash used in financing activities (939,500) --
----------- -----------
NET INCREASE IN CASH AND CASH EQUIVALENTS 1,654,006 3,589,144
CASH AND CASH EQUIVALENTS, beginning of period 2,418,201 1,362,963
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 4,072,207 $ 4,952,107
=========== ===========
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
- ------------------------------
Item 2. Management's Discussion and Analysis of
- ------- Financial Condition and Results of Operations
---------------------------------------------
Scottsdale Land Trust Limited Partnership (the Registrant) received
$50,000,000 in gross proceeds from its public offering of the Units on November
23, 1988. After deducting organizational and offering expenses, including
selling expenses, the financial advisory fee, property acquisition fee and due
diligence expense reimbursement, the Registrant had $43,250,000 in net proceeds
available for investment. The net proceeds were used to purchase the property
(The Perimeter Center), fund the construction of the infrastructure and fund the
$8.5 million loan to Franchise Finance Corporation of America (FFCA), in
accordance with the partnership agreement. Pursuant to the loan agreement, FFCA
makes monthly payments of interest only to the Registrant and is current on such
payments. All unexpended funds are invested in U.S. Government Agency discount
notes and bank repurchase agreements (which are secured by United States
Treasury and Government obligations). Reserves remaining in the Registrant
approximate $1.3 million. These reserves may be used from time to time to pay
amounts assessed by the city or county taxing authorities for developmental or
other costs. Aside from the sale of land parcels, the Registrant's primary
sources of revenue are interest payments received from FFCA under the loan
agreement and interest earned on the Registrant's temporary investments.
During the quarter ended March 31, 1997 (the period), the Registrant sold
four land parcels aggregating 10.1 acres to unaffiliated third parties. These
transactions provided for an aggregate cash sales price of $2,894,380, an
aggregate original cost of $1,763,934 and closing and other costs of $227,108,
resulting in a total gain of $903,338 for the period.
The Registrant declared a cash distribution to the limited partners of
$2,667,272 for the quarter ended March 31, 1997 (to be paid in May 1997) which
represents the net cash proceeds from the above-mentioned parcel sales. During
the period, cash proceeds from the land parcel sales were invested in temporary
investment securities pending distribution to the limited partners.
Land sales revenues comprise the majority of total revenues for the
quarters ended March 31 ,1997 and 1996. The average sales price per acre of land
sold during 1997 increased 33% to approximately $286,600 per acre from
approximately $215,000 per acre for the comparable period of 1996. Despite the
increase in average land sales price per acre, land sales revenues were higher
in 1996 than in 1997 because the Registrant sold 16.6 acres of land during the
quarter ended March 31, 1996 as compared to 10.1 acres sold during the quarter
ended March 31, 1997. The timing of land sales varies from quarter to quarter
and, although the Registrant continued negotiations during the quarter for the
sale of several of the smaller land parcels located within The Perimeter Center,
it cannot determine which, if any, of these negotiations will result in the sale
of a land parcel and, therefore, cannot predict the timing or amount of any
future cash distribution from such sale proceeds.
Interest and other income decreased by $21,283 due to the decrease in
temporary investment securities held during the period, resulting from a higher
average cash balance invested in the March 1996 quarter, prior to distribution
of cash to the limited partners.
Total expenses for the period decreased by $62,987 from the comparable
period of the prior year due to decreases in the cost of land sales ($76,469),
general partner fees ($4,492) and marketing expenses ($24,652), offset partially
by an increase in other operating expenses ($41,787). General partner fees
decreased during the period because the fees are based on Assets Under
Management, as defined in the partnership agreement, and as parcels are sold the
general partner fees will be reduced accordingly. Marketing expenses vary from
quarter to quarter based primarily on the timing of various marketing and
promotional events planned for the period. The increase in other operating
expenses resulted primarily from increased legal fees and maintenance costs.
In the opinion of management, the financial information included in this
report reflects all adjustments necessary for fair presentation. All such
adjustments are of a normal recurring nature.
<PAGE>
PART I - FINANCIAL INFORMATION
- ------------------------------
Item 3. Quantitative and Qualitative Disclosures About Market Risk
- ------- ------------------------------------------------------
The Co-Registrants do not use derivative financial instruments.
<PAGE>
FFCA INVESTOR SERVICES CORPORATION 88-B
---------------------------------------
BALANCE SHEET - MARCH 31, 1997
------------------------------
ASSETS
Cash $100
Investment in Scottsdale Land Trust Limited Partnership, at cost 100
----
Total Assets $200
====
LIABILITY
Payable to Parent $100
----
STOCKHOLDER'S EQUITY
Common Stock; $l par value; 100 shares authorized,
issued and outstanding 100
----
Liability and Stockholder's Equity $200
====
Note: FFCA Investor Services Corporation 88-B (88-B) was organized on
August 11, 1987 to act as the assignor limited partner in Scottsdale Land Trust
Limited Partnership (SLT). The assignor limited partner is the owner of record
of the limited partnership units of SLT. All rights and powers of 88-B have been
assigned to the holders, who are the registered and beneficial owners of the
units. Other than to serve as assignor limited partner, 88-B has no other
business purpose and will not engage in any other activity or incur any debt.
<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.
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
By FFCA MANAGEMENT COMPANY LIMITED
PARTNERSHIP
General Partner
By PERIMETER CENTER MANAGEMENT COMPANY
Corporate General Partner
Date: May 12, 1997 By /s/ John R. Barravecchia
---------------------------------------------
John R. Barravecchia, Executive Vice
President, Treasurer and Chief
Financial Officer
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
co-registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FFCA INVESTOR SERVICES CORPORATION 88-B
Date: May 12, 1997 By /s/ John R. Barravecchia
---------------------------------------------
John R. Barravecchia, President,
Secretary and Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE BALANCE SHEET AS OF MARCH 31, 1997 AND
THE STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED
MARCH 31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000824098
<NAME> SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
<MULTIPLIER> 1
<CURRENCY> U. S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 4,072,207
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 28,330,809
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 40,216,054
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 37,320,086
<TOTAL-LIABILITY-AND-EQUITY> 40,216,054
<SALES> 2,894,380
<TOTAL-REVENUES> 3,144,088
<CGS> 1,991,042
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 887,071
<INCOME-TAX> 0
<INCOME-CONTINUING> 887,071
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 887,071
<EPS-PRIMARY> 17.74
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE BALANCE SHEET AS OF MARCH 31, 1997
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
BALANCE SHEET.
</LEGEND>
<CIK> 0000824134
<NAME> FFCA INVESTOR SERVICES CORPORATION 88-B
<MULTIPLIER> 1
<CURRENCY> U. S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 100
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 200
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 100
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 200
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
