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, 1999
----------------------
[ ] 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
Commission file number 0-17853
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 (480) 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 1. FINANCIAL STATEMENTS.
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
BALANCE SHEETS
MARCH 31, 1999 AND DECEMBER 31, 1998
(Unaudited)
March 31, December 31,
1999 1998
----------- -----------
ASSETS
LAND:
Held for sale $12,486,444 $12,486,444
Subject to sale agreements 3,062,371 3,062,371
Subject to sale agreement with affiliate 788,287 788,287
----------- -----------
Total land 16,337,102 16,337,102
LOAN RECEIVABLE FROM AFFILIATE 7,598,415 7,598,415
CASH AND CASH EQUIVALENTS 2,021,112 2,292,149
PREPAID EXPENSES AND OTHER 114,274 254,702
----------- -----------
Total assets $26,070,903 $26,482,368
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
DISTRIBUTION PAYABLE TO LIMITED PARTNERS $ 307 $ 441,307
ACCOUNTS PAYABLE AND ACCRUED EXPENSES 172,988 198,193
----------- -----------
Total liabilities 173,295 639,500
----------- -----------
PARTNERS' CAPITAL (DEFICIT):
General partner (6,980) (7,527)
Limited partners 25,904,588 25,850,395
----------- -----------
Total partners' capital 25,897,608 25,842,868
----------- -----------
Total liabilities and partners' capital $26,070,903 $26,482,368
=========== ===========
<PAGE>
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(Unaudited)
1999 1998
---- ----
REVENUES:
Land sales $ -- $1,777,248
Interest on loan to affiliate 212,500 212,500
Interest on investments and other 25,013 48,878
-------- ----------
237,513 2,038,626
-------- ----------
EXPENSES:
Cost of land sales -- 1,082,505
General partner fees 61,850 66,486
Property management fees 9,000 9,000
Marketing 5,713 3,154
Property taxes 50,795 33,095
Other operating 55,415 60,476
-------- ----------
182,773 1,254,716
-------- ----------
NET INCOME $ 54,740 $ 783,910
======== ==========
NET INCOME ALLOCATED TO:
General partner $ 547 $ 892
Limited partners 54,193 783,018
-------- ----------
$ 54,740 $ 783,910
======== ==========
NET INCOME PER LIMITED PARTNERSHIP UNIT
(based on 50,000 units held by limited partners) $ 1.08 $ 15.66
======== ==========
<PAGE>
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
FOR THE THREE MONTHS ENDED MARCH 31, 1999
(Unaudited)
Limited Partners
General ----------------------
Partner Number Total
Amount of Units Amount Amount
------ -------- ------ ------
BALANCE, December 31, 1998 $(7,527) 50,000 $25,850,395 $25,842,868
Net Income 547 -- 54,193 54,740
------- ------ ----------- -----------
BALANCE, March 31, 1999 $(6,980) 50,000 $25,904,588 $25,897,608
======= ====== =========== ===========
<PAGE>
SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(Unaudited)
1999 1998
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 54,740 $ 783,910
Adjustments to net income:
Change in assets and liabilities:
Decrease in land held for sale -- 1,039,938
Increase in land subject to sales agreements -- (128,754)
Decrease (increase) in prepaid expenses and other 140,428 (17)
Decrease in accounts payable and
accrued liabilities (25,205) (38,394)
----------- -----------
Net cash provided by operating activities 169,963 1,656,683
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Limited partner distribution declared -- (1,605,927)
Decrease in distribution payable (441,000) (2,622,573)
----------- -----------
Net cash used in financing activities (441,000) (4,228,500)
----------- -----------
NET DECREASE IN CASH AND CASH EQUIVALENTS (271,037) (2,571,817)
CASH AND CASH EQUIVALENTS, beginning of period 2,292,149 5,844,446
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 2,021,112 $ 3,272,629
=========== ===========
<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, 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. The entire principal balance of
the loan is due in May 2000, or earlier if all of The Perimeter Center land
parcels are sold prior to that date. Reserves remaining in the Registrant are
approximately $1.8 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. The Registrant's primary sources of revenue are land sales,
interest payments received from FFCA under the loan agreement and interest
earned on the Registrant's temporary investments. As land parcels are sold,
distributions of the net cash sale proceeds are made in accordance with the
partnership agreement. Once all of The Perimeter Center parcels are sold, the
Registrant will liquidate all of its other assets and distribute them in
accordance with the partnership agreement.
During the quarter ended March 31, 1999 (the period), the Registrant closed
no land sale transactions; therefore, there were no cash distributions declared.
At March 31, 1999, the Registrant had three parcels of land (approximately
fifteen acres) under contract for sale, at a price aggregating approximately $7
million, to two unaffiliated third parties. The original cost of the parcels
totaled approximately $3.1 million. Approximately 70 acres (excluding the
parcels in escrow) remain available for sale within The Perimeter Center and the
Registrant has entered into preliminary negotiations for the sale of several of
the remaining land parcels. The Registrant 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 distributions.
Total revenues were approximately $238,000 for the quarter ended March 31,
1999 as compared to approximately $2 million for the comparable quarter in 1998.
Revenues in the 1998 quarter were higher because land sales comprised the
majority of the revenues in 1998. Interest on investments and other income for
the period decreased by approximately $24,000 from the comparable period of the
prior year due to the decrease in temporary investment securities held during
the March 1999 quarter. The higher cash balance in the 1998 quarter resulted
from net land sale proceeds held during that quarter prior to distribution of
the cash to the limited partners. Total expenses (excluding the cost of land
sales) increased by approximately $11,000 for the period over the comparable
period of the prior year due primarily to an increase in property taxes.
Property taxes increased, despite the sale of land parcels during the past
twelve months, due to higher assessed land values.
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.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The financial instruments held by the Registrant at March 31, 1999 consist
of cash equivalents and a loan receivable from an affiliate. The Registrant
intends to hold the investments to maturity; therefore, these financial
instruments do not subject the Registrant to a material exposure to changes in
interest rates.
<PAGE>
FFCA INVESTOR SERVICES CORPORATION 88-B
BALANCE SHEET - MARCH 31, 1999
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 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 5, 1999 By /s/ John Barravecchia
--------------------------------------------
John 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 caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FFCA INVESTOR SERVICES CORPORATION 88-B
Date: May 5, 1999 By /s/ John Barravecchia
--------------------------------------------
John 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, 1999 AND THE STATEMENT OF OPERATIONS FOR THE THREE MONTHS
ENDED MARCH 31, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 824098
<NAME> SCOTTSDALE LAND TRUST LIMITED PARTNERSHIP
<MULTIPLIER> 1
<CURRENCY> U. S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<EXCHANGE-RATE> 1
<CASH> 2,021,112
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 16,337,102
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 26,070,903
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 25,897,608
<TOTAL-LIABILITY-AND-EQUITY> 26,070,903
<SALES> 0
<TOTAL-REVENUES> 237,513
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 54,740
<INCOME-TAX> 0
<INCOME-CONTINUING> 54,740
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 54,740
<EPS-PRIMARY> 1.08
<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, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
BALANCE SHEET.
</LEGEND>
<CIK> 824134
<NAME> FFCA INVESTOR SERVICES CORPORATION 88-B
<MULTIPLIER> 1
<CURRENCY> U. S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<EXCHANGE-RATE> 1
<CASH> 100
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<PP&E> 0
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<CURRENT-LIABILITIES> 0
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0
0
<COMMON> 100
<OTHER-SE> 0
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<SALES> 0
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<OTHER-EXPENSES> 0
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</TABLE>
