<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE
ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ___ to ___
Commission File Number 0-18528
INCOME GROWTH PARTNERS, LTD. X, A CALIFORNIA LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
CALIFORNIA 33-0294177
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1300 Sorrento Valley Road, Suite 108, San Diego, California 92121
(Address of principal executive offices) (Zip Code)
(619) 457-2750
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
LIMITED PARTNERSHIP INTERESTS
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
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by 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 Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [X]
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:
Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [X] No [ ]
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
PART I
Item 1. Business......................................................................1
Item 2. Properties....................................................................2
Item 3. Legal Proceedings.............................................................3
Item 4. Submission of Matters to a Vote of Security Holders...........................3
PART II
Item 5. Market for the Registrant's Units and Related Security Holder Matters.........3
Item 6. Selected Consolidated Financial Data..........................................4
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.....................................................4
Item 8. Financial Statements and Supplementary Data...................................7
Item 9. Disagreements on Accounting and Financial Disclosures.........................7
PART III
Item 10. Directors and Executive Officers of the Registrant............................7
Item 11. Executive Compensation........................................................8
Item 12. Security Ownership of Certain Beneficial Owners and Management................8
Item 13. Certain Relationships and Related Transactions................................8
PART IV
Item 14. Exhibits, Financial Statement Schedule and Reports on Form 8-K................9
Signatures .............................................................................11
</TABLE>
<PAGE> 3
PART I
ITEM 1. BUSINESS
GENERAL
Income Growth Partners, Ltd. X, a California limited partnership (the "Limited
Partnership") and subsidiaries (collectively, the "Partnership"), was formed in
February 1988, to acquire, operate and hold for investment one or more parcels
of income-producing, multi-family residential real property. Currently, the
Limited Partnership operates two separate apartment complexes in Southern
California: 1) Mission Park and 2) Shadow Ridge Meadows. The limited
partnership agreement provides that the Partnership shall continue through
February 2021, unless terminated sooner.
Income Growth Management, Inc. ("IGM") is the sole general partner. The general
partner has made no cash capital contributions to date. As of December 31,
1999, there were approximately 2,039 limited partners in the Partnership.
The Partnership has no full-time employees. Employees of corporations affiliated
with the general partner perform certain administrative and other services on
behalf of the Partnership (see Item 13). The Partnership's executive offices
are located at 11300 Sorrento Valley Road, Suite 108, San Diego, California
92121 and the Partnership's telephone number is (619) 457-2750.
FINANCING STRATEGY
The Partnership seeks to minimize the cost of financing its properties and will
refinance existing loans from time to time to take advantage of prevailing
market conditions. The Mission Park and Shadow Ridge Meadows properties were
refinanced to prevailing rates during 1995 and 1997, respectively.
COMPETITIVE CONDITIONS
Changes in the national and regional economic climates, changes in local real
estate conditions such as the oversupply of apartments or a reduction in demand
for apartments, competition from single-family housing, apartment properties
and other forms of multifamily residential housing, the inability to provide
adequate maintenance and to obtain adequate insurance, increased operating
costs, changes in zoning, building, environmental, rent control and other laws
and regulations, the costs of compliance with current and future laws, changes
in real property taxes and unusual occurrences (such as earthquakes and floods)
and other factors beyond the control of the Partnership may adversely affect
the income from, and value of, the Partnership's properties.
LEASES AND INFLATION
Substantially all of the leases at the Partnership's apartment properties are
for a period of six months or less, allowing, at the time of renewal, for
adjustments in the rental rate and the opportunity to release the apartment unit
at the prevailing market rate. The short-term nature of these leases generally
serves to minimize the risk to the Partnership of the adverse effect of
inflation and the Partnership does not believe that inflation has had a
material adverse impact on its revenues.
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ITEM 1. BUSINESS, CONTINUED
Under the Americans with Disabilities Act of 1990 (the "ADA"), all places of
public accommodation are required to meet certain federal requirements related
to access and use by disabled persons. These requirements became effective in
1992. A number of additional federal, state and local laws exist which also may
require modifications to the properties, or restrict certain further renovations
thereof, with respect to access thereto by disabled persons. For example, the
Fair Housing Amendments Act of 1988 (the "FHAA") requires apartment properties
first occupied after March 13, 1990 to be accessible to the handicapped.
Noncompliance with the ADA or the FHAA could result in an order to correct any
noncomplying feature, which could result in substantial capital expenditures.
Although management of the Partnership believes that the properties are
substantially in compliance with present requirements. If the properties are not
in compliance, the Partnership is likely to incur additional costs to comply
with the ADA and the FHAA.
During 1995, on a tax free basis, the Limited Partnership exchanged the
Mission Park property for a 99% interest in IGPX Mission Park Associates, L.P.,
a newly formed California limited partnership (the "Mission Park Subsidiary").
The Mission Park Subsidiary is separate and distinct from the Limited
Partnership having separate assets, liabilities and business operations.
During 1997, on a tax free basis, the Limited Partnership exchanged the Shadow
Ridge Meadows property for a 99% interest in IGP X Shadow Ridge Meadows, Ltd.,
a newly formed California limited partnership (the "Shadow Ridge Meadows
Subsidiary"). The Shadow Ridge Meadows Subsidiary is also separate and distinct
from the Limited Partnership, having separate assets, liabilities and business
operations.
Formation of the Mission Park Subsidiary and the Shadow Ridge Subsidiary had no
impact on the Partnership's overall financial condition, results of operations,
allocation of net income/loss, cash distributions or Partnership assets.
ITEM 2. PROPERTIES
The Partnership, through its subsidiaries, presently owns two properties, as
follows:
MISSION PARK:
Date of purchase: August 1989
Purchase price: $17,100,000
Property Description: A 264-unit apartment complex located in San Marcos,
California. The property includes two full-size recreation rooms, two
heated swimming pools and spas, night-lighted tennis courts, a satellite
cable TV system and covered parking. The building is approximately ten
years old. The property contains 215,292 square feet.
SHADOW RIDGE MEADOWS:
Date of purchase: November 1988
Purchase price: $12,700,000
Property Description: A 184-unit apartment complex located in Vista,
California. The property includes a large recreation center, a heated
swimming pool and spa, five laundry facilities, a satellite cable TV
system and covered parking. The building is approximately twelve years
old. The property contains 127,197 square feet.
2
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ITEM 3. LEGAL PROCEEDINGS
The Partnership is not a party to any legal proceedings other than various
claims and lawsuits arising in the normal course of its business which, in the
opinion of the Partnership's management, are not individually or in the
aggregate material to its business.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
PART II
ITEM 5. MARKET FOR REGISTRANT'S UNITS AND RELATED SECURITY HOLDER MATTERS
(a) Market Information
As of December 31, 1999, the outstanding securities of the Partnership
included the Original Units and Class A Units held by the limited
partners. The Partnership's Amended and Restated Agreement of Partnership
substantially restricts transfers of all units and no public trading
market for the units exists or is intended or expected to develop.
(b) Holders
As of December 31, 1999, the Partnership's 18,826.5 outstanding Original
Units and 8,100 Class A Units were held by an aggregate of 2,039 Limited
Partners.
(c) Dividends
As a limited partnership, the Partnership does not pay dividends.
The amended partnership agreement provides that any distributions of cash
from operations will be made in the following order of priority:
First, each Class A Unit receives a 12% cumulative noncompounded annual
return on the balance of actual funds invested in Class A Units. Second,
each Class A Unit receives a total return of original invested capital.
Third, each Class A Unit receives a $500 bonus. Fourth, each Original Unit
holder receives a 10% noncumulative return on the adjusted balance of
original invested capital. Thereafter, 90% of distributions on cash from
operations will be made to the Original Unit holders and 10% to the
general partner. Fifth, each Original Unit holder receives a 10%
cumulative return on the adjusted balance of original invested capital
(the "Preferred Return"). Thereafter, 85% of distributions of cash from
operations will be made to the Original Unit holders and 15% to the
general partner.
The Partnership distributed approximately $513,667 during 1999.
Cash distributions are determined at the discretion of the general
partner. Any future distributions are largely dependent on future income,
expenses, debt service and operating reserves and there can be no assurance
that future distributions will be paid.
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ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA
The following selected consolidated financial data should be read in conjunction
with the audited consolidated financial statements and the related notes
described in Item 8 herein:
<TABLE>
<CAPTION>
1999 1998 1997 1996 1995
<S> <C> <C> <C> <C> <C>
Total assets....................................... $19,818,470 $20,513,980 $21,225,719 $21,476,918 $22,153,868
Long-term obligations.............................. 19,382,900 19,579,523 19,765,202 19,788,869 19,966,935
Total revenue...................................... 4,485,956 4,148,324 3,791,975 3,576,981 3,896,384
Total expenses..................................... (4,495,990) (4,331,753) (4,163,361) (4,063,509) (4,584,674)
Income (loss) before extraordinary item:........... 22,932 (183,429) (371,386) (486,528) 3,757,729
Extraordinary item:................................ -- -- -- -- 4,446,019
Net income (loss).................................. 22,932 (183,429) (371,386) (486,528) 3,757,729
Net income (loss) per partnership unit before
extraordinary gain............................... 0.85 (6.81) (13.79) (18.06) (28.48)
Extraordinary gain per partnership unit............ -- -- -- -- 184.01
Net income (loss) per partnership unit............. 0.85 (6.81) (13.79) (18.06) 155.53
Weighted average limited partnership units......... 26,926 26,926 26,926 26,926 24,161
</TABLE>
There had been no cash distributions to partners up until December 31, 1997. The
Partnership distributed approximately $514,000 and $322,000 during 1999 and
1998, respectively.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS:
The following Management's Discussion and Analysis of Financial Condition and
Results of Operations should be read in conjunction with the financial
statements and notes thereto filed herewith. Historical results and percentage
relationships set forth in the consolidated statement of operations in the
financial statements, including trends which might appear, should not be taken
as indicative of future operations.
Statements contained in this report that are not purely historical are
forward-looking statements including statements regarding the Partnership's
expectations, intentions, beliefs or strategies regarding the future. All
forward-looking statements included in this report are based upon the
information available to the Partnership on the date thereof, and the
Partnership assumes no obligation to update any such forward-looking statements.
It is important to note that the Partnership's actual results could differ
materially from those in such forward-looking statements.
(a) Liquidity and Capital Resources
In January 1994, the Limited Partnership filed a voluntary petition for
relief under Chapter 11 of the federal bankruptcy laws in the United
States Bankruptcy Court for the Southern District of California.
Under the provisions of the Plan of Reorganization (the "Plan"), the
Limited Partnership was allowed to retain ownership of the Mission Park
and Shadow Ridge Meadows properties. Despite $2,025,000 in additional
capital from existing investors in the form of Class A Units, the Limited
Partnership was unable to raise the necessary capital to retain ownership
of its third property, Margarita Summit.
The Limited Partnership emerged from Chapter 11 effective in May 1995
having fully satisfied all claims in accordance with the Plan.
Prior to 1996, the Partnership's operating and debt service obligations
have been financed through the sale of Partnership Units, cash provided by
operating activities, and 1995 debt restructuring activities. During 1996
through 1999, all of the Partnership's operating and debt service cash
requirements have been met through cash generated from operations.
4
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, CONTINUED:
COMPARISON OF YEAR ENDED DECEMBER 31, 1999 TO THE YEAR ENDED DECEMBER
31, 1998.
Net cash provided by operating activities for the year ended December
31, 1999 was $871,000 compared to $871,000 for the same period in 1998.
Net cash used in investing activities for the year ended December 31,
1999 was $144,000 compared to $156,000 for the same period in 1998. The
decrease in cash used in investing activities was due primarily to
decreases in property improvements as compared to the prior year.
Net cash used in financing activities for the year ended December 31,
1999 was $734,000 compared to $555,000 for the same period in 1998. The
increase was primarily due to an increase of approximately $192,000 in
distributions paid during 1999, an increase of principal payments under
mortgage debt of approximately $11,000 and a decrease in principal
payments to affiliate of approximately $36,000.
COMPARISON OF YEAR ENDED DECEMBER 31, 1998 TO THE YEAR ENDED DECEMBER
31, 1997.
Net cash provided by operating activities for the year ended December
31, 1998 was $871,000 compared to $594,000 for the same period in 1997.
The principal reason for this difference was a decrease in net loss of
approximately $188,000, a decrease in prepaid expenses and other assets
and an increase in accounts payable resulting from the timing of
payments.
Net cash used in investing activities for the year ended December 31,
1998 was $156,000 compared to $252,000 for the same period in 1997. The
decrease in cash used in investing activities is due primarily to
decreases in property improvements as compared to the prior year.
Net cash used in financing activities for the year ended December 31,
1998 was $555,000 compared to $305,000 for the same period in 1997. The
increase was primarily due to an increase in the principal payments
under mortgage debt of approximately $162,000, distributions paid of
approximately $322,000 during 1998, the decrease of loan fees of
approximately $338,000 from the refinance of the Shadow Ridge Meadows
Property in 1997, and a decrease in the proceeds received from an
affiliate of approximately $62,000.
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, CONTINUED:
(b) Results of Operations
COMPARISON OF YEAR ENDED DECEMBER 31, 1999 TO THE YEAR ENDED DECEMBER 31,
1998.
Rental revenue for the year ended December 31, 1999 was $4,304,000, an
increase of 9% over rents of $3,944,000 in the comparable period in 1998.
The increase is primarily attributable to an increase in monthly tenant
rental rates.
Interest expense for the year ended December 31, 1999 was $1,464,000, a
2% decrease from interest expense of $1,489,000 in the comparable
period in 1998.
Operating expense of the year ended December 31, 1999 was $2,072,000, an
increase of 7% over operating expense of $1,929,000 in the comparable period
in 1998. The increase is attributable to higher expenses related to the
increase in rental revenue.
Depreciation expense for the year ended December 31, 1999 was $928,000, an
increase of 2% over depreciation expense of $914,000 in the comparable
period in 1998. The increase is primarily attributable to consistent yearly
increases in total capitalized fixed asset expenditures.
COMPARISON OF YEAR ENDED DECEMBER 31, 1998 TO THE YEAR ENDED DECEMBER 31,
1997.
Rental revenue for the year ended December 31, 1998 was $3,944,000, an
increase of 8% over rents of $3,656,000 in the comparable period in 1997.
The increase is primarily attributable to an increase in monthly tenant
rental rates.
Interest expense for the year ended December 31, 1998 was $1,489,000, a
decrease of 4% over interest expense of $1,544,000 in the comparable period
in 1997. The decrease is primarily attributable to the refinancing on the
Shadow Ridge Meadows Property, as well as the increase in the principal
payments on the existing mortgage loans. The increase is also attributable
to amortization of loan fees related to the refinancing of the Shadow Ridge
Meadows Property.
Operating expense for the year ended December 31, 1998 was $1,929,000, an
increase of 8% over operating expense of $1,782,000 in the comparable period
in 1997. The increase is attributable to higher expenses related to the
increase in rental revenue.
Depreciation expense for the year ended December 31, 1998 was $914,000, an
increase of 9% over depreciation expense of $837,000 in the comparable
period in 1997. The increase is primarily attributable to consistent yearly
increases in total capitalized fixed asset expenditures.
(c) Year 2000
The Partnership is currently not aware of any Year 2000 problems in any of
its critical systems or with any of its significant vendors. However, the
success to date of its Year 2000 efforts cannot guarantee that a Year 2000
problem affecting third parties upon which it relies will not become
apparent in the future. The following disclosure is a Year 2000 readiness
disclosure statement under the Year 2000 Readiness and Disclosure Act.
The Partnership's Year 2000 readiness program was designed to minimize the
possibility of serious Year 2000 interruptions. The Partnership began
assessment of the Partnership's software applications and hardware early in
1999. Throughout 1999, the partnership implemented a Year 2000 readiness
program which was completed in December 1999. The Year 2000 readiness
program consisted mainly of an acceleration of scheduled upgrades of
computer hardware for the Partnership's properties and the corresponding
upgrades of the computer operating system. The total cost of the
Partnership's Year 2000 readiness program was approximately $10,000.
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements and supplementary data required by this
item are set forth at the pages indicated in Item 14(a).
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None
PART III
ITEM 10. GENERAL PARTNER AND EXECUTIVE OFFICERS OF THE PARTNERSHIP
The general partner of the Partnership is Income Growth Management, Inc.
("IGM"), a California corporation. The executive officers of IGM do not
receive compensation from the Partnership.
The names, ages and positions of responsibility held by the executive
officers and directors of IGM are as follows:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
David Maurer 47 President and Director
Timothy Maurer 50 Secretary and Director
Robert Green 42 Vice President of Operations and Director
</TABLE>
FAMILY RELATIONSHIPS
David Maurer and Timothy Maurer are brothers.
BUSINESS EXPERIENCE
The following is a brief background of the directors and executive officers
of IGM:
DAVID MAURER has served as President and Director of IGM since 1992, and as
President and Director of ENA Corporation ("ENA"), an affiliate of IGM,
since 1979. He has been involved in real estate syndication and property
management since 1980, and in real estate development and construction
since 1974. David was educated at the University of California, San Diego
(B.A. 1974).
TIMOTHY MAURER has served as Chief Financial Officer, Secretary and
Director of IGM since 1979. He has been involved in real estate
syndication, development, design and construction since 1975. Timothy was
educated at the California College of Arts and Crafts, Oakland (B.F.A.
1972).
ROBERT GREEN has served as Vice President of Operations and Director since
1988. He has also been the Director of Property Management of ENA since
1988. He has been directly involved in property management since 1980.
Robert worked for four years with Coldwell Banker Real Estate Management
Services in San Diego managing both commercial and residential property. He
also worked for four years with C&R Realty Company managing over 75
residential properties in Oregon and Washington. Robert was educated at
Pacific University in Forest Grove, Oregon (B.A. 1980).
7
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ITEM 11. EXECUTIVE COMPENSATION
The Partnership has no executive officers and has not paid nor proposes
to pay any compensation or retirement benefits to the directors or
executive officers of Income Growth Management, Inc., the general
partner. See Item 13 for compensation to the general partner.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) Security Ownership of Certain Beneficial Owners
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENT
TITLE OF CLASS BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
-------------- ------------------- -------------------- --------
<S> <C> <C> <C>
Class A Units John W. Baer 609.0000 7.5%
1091 Valley View Court
Los Altos, CA 94024
</TABLE>
No other person or group is known by the Partnership to own beneficially
more than 5% of the outstanding Original Units or Class A Units.
(b) Security Ownership of Management
None of the officers and directors of the Partnership's corporate
general partners are the beneficial owners of any Original Units or
Class A Units.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Partnership is entitled to engage in various transactions involving
its general partners and its affiliates as described in the Partnership
Agreement.
The table below reflects amounts paid to the general partner or its
affiliates during the following years:
<TABLE>
<CAPTION>
1999 1998 1997
---- ---- ----
<S> <C> <C> <C>
Management fees $226,000 $207,300 $179,000
Administrative fees 130,000 99,000 113,000
Loan origination fees - 10,000 97,500
</TABLE>
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PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) Documents filed as part of this report:
(1) Financial Statements
The following financial statements of the Partnership and related
notes to financial statements and accountants' report are filed
herewith:
Report of Independent Accountants
Consolidated Balance Sheets as of December 31, 1999 and 1998
Consolidated Statements of Operations for the years ended
December 31, 1999, 1998 and 1997
Consolidated Statements of Partners' Capital (Deficit) for the
years ended December 31, 1999, 1998 and 1997
Consolidated Statements of Cash Flows for the years ended
December 31, 1999, 1998 and 1997
Notes to Consolidated Financial Statements
(2) Financial Statement Schedule
Schedule III - Real Estate and Accumulated Depreciation
All other schedules are either not required, or the information
therein is included in the notes to the audited financial statements.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the last quarter of the fiscal
year covered by the report.
(c) Exhibits
The following Exhibit Index lists the exhibits that are either filed as
part of this report or incorporated herein by reference from a prior
filing.
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION LOCATION
- ----------- ----------- --------
<S> <C> <C>
2.2 Second Amended Disclosure Statement to Debtor's (1)
Second Amended Plan of Reorganization, As
Revised (with Second Amended Plan of Reorganization
attached as Exhibit 1) filed with the Bankruptcy
Court on October 25, 1994;
Order Approving Second Amended Disclosure
Statement to Debtor's Second Amended Plan
of Reorganization, Approving Ballots and
Fixing Dates for Filing Acceptances or
Rejections of Plan and for Confirmation
Hearing, Combined with Notice Thereof;
Equity Interest Holder Ballot for Accepting
or Rejecting Debtor's Second Amended Plan
of Reorganization;
Offering Memorandum for Income Growth
Partners, Ltd. X Class A Units dated
October 27, 1994 (with Amended and
Restated Agreement of Limited Partnership
attached as Exhibit B).
3.1 Articles of Incorporation of IGP X Mission (2)
Park, Inc.
4.2 Amended and Restated Agreement of Limited (3)
Partnership
4.3 Agreement of Limited Partnership of IGP X (2)
Mission Park Associates, L.P., A California
Limited Partnership
4.4 Agreement of Limited Partnership of IGP X (2)
Shadow Ridge Meadows, Ltd., A California
Limited Partnership
27.6 Financial Data Schedule (6)
28.1 Prospectus dated January 3, 1991 (4)
28.4 Letter regarding resignation of General Partner (5)
</TABLE>
- ------------------
(1) Incorporated by reference from the Partnership's Quarterly Report on Form
10-Q for the third quarter ended September 30, 1994 (Commission File
Number 0-18528).
(2) Incorporated by reference from the Partnership's Current Report on Form
8-K dated December 27, 1995 (Commission File Number 0-18528).
(3) Included as Exhibit "B" to the Partnership's Offering Memorandum for
Income Growth Partners, Ltd. X Class A Units dated October 27, 1994,
included in Exhibit 2.2 incorporated by reference from the Partnership's
Quarterly Report on Form 10-Q for the third quarter ended September 30,
1994 (Commission File Number 0-18528).
10
<PAGE> 13
(4) Incorporated by reference from the Partnership's Annual Report on
Form 10-K for the Fiscal Year ended December 31, 1992 (Commission File
Number 0-18528).
(5) Incorporated by reference from the Partnership's Annual Report on Form 10-K
for the Fiscal Year ended December 31, 1993 (Commission File Number
0-18528).
(6) Filed herewith.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Date: March 29, 2000
INCOME GROWTH PARTNERS, LTD.
(a California Limited Partnership)
By: Income Growth Management, Inc.
General Partner
By: /s/ David W. Maurer
David W. Maurer, President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signatures Title and Capacity Date
<S> <C> <C>
/S/ David W. Maurer President March 29, 2000
---------------------------- ------------------------------ ------------------
/S/ Timothy C. Maurer Principal Financial Officer March 29, 2000
---------------------------- ------------------------------ ------------------
</TABLE>
11
<PAGE> 14
APPENDIX
FINANCIAL STATEMENTS
<PAGE> 15
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS - ITEM 14 OF FORM 10-K
PAGE
Report of Independent Accountants.......................................... F-2
Consolidated Financial Statements and Notes:
Balance Sheets as of December 31, 1999 and 1998....................... F-3
Statements of Operations for the Years Ended
December 31, 1999, 1998 and 1997...................................... F-4
Statements of Partners' Capital (Deficit) for the Years Ended
December 31, 1999, 1998 and 1997...................................... F-5
Statements of Cash Flows for the Years Ended
December 31, 1999, 1998 and 1997...................................... F-6
Notes to Consolidated Financial Statements............................ F-7
Schedule III - Real Estate and Accumulated Depreciation............... F-12
F-1
<PAGE> 16
REPORT OF INDEPENDENT ACCOUNTANTS
To Income Growth Partners, Ltd. X and Subsidiaries
In our opinion, the consolidated financial statements listed in the
accompanying index present fairly, in all material respects, the financial
position of Income Growth Partners, Ltd. X, a California limited partnership,
and subsidiaries (collectively, the "Partnership") at December 31, 1999 and
1998 and the results of their operations and their cash flows for each of the
three years in the period ended December 31, 1999 in conformity with accounting
principles generally accepted in the United States. In addition, in our opinion,
the financial statement schedule listed in the accompanying index presents
fairly, in all material respects, the information set forth therein when read in
conjunction with the related consolidated financial statements. These financial
statements and financial statement schedule are the responsibility of the
Partnership's management; our responsibility is to express an opinion on these
financial statements and financial statement schedule based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for the
opinion expressed above.
PricewaterhouseCoopers LLP
San Diego, California
March 3, 2000
F-2
<PAGE> 17
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1999 AND 1998
________________________________________________________________________________
<TABLE>
<CAPTION>
1999 1998
----------- ------------
<S> <C> <C>
ASSETS
Rental properties
Land $ 7,078,365 $ 7,078,365
Buildings and improvements 21,907,461 21,763,241
----------- -----------
28,985,826 28,841,606
Less accumulated depreciation (10,316,949) (9,445,320)
----------- -----------
18,668,877 19,396,286
Cash and cash equivalents 434,712 441,909
Deferred loan fees, net of accumulated
amortization of $188,166 and
$132,140, respectively 589,017 645,044
Prepaids and other assets 125,864 30,742
----------- -----------
Total assets $19,818,470 $20,513,981
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Mortgage loans payable $19,382,900 $19,579,523
Other liabilities:
Loan payable to affiliates 48,540 72,640
Accounts payable and accrued liabilities 172,559 170,177
Accrued interest payable 120,684 125,699
Security deposits 217,757 199,177
----------- -----------
19,942,440 20,147,216
Commitments and contingencies
Partners' (deficit)/capital (113,970) 376,765
Note receivable from general partner (10,000) (10,000)
----------- -----------
Total liabilities and partners'
capital $19,818,470 $20,513,981
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-3
<PAGE> 18
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
________________________________________________________________________________
<TABLE>
<CAPTION>
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
REVENUES
Rents $4,303,557 $3,943,519 $3,655,595
Interest 7,175 6,710 8,925
Other 175,224 198,095 127,455
---------- ---------- ----------
Total revenues 4,485,956 4,148,324 3,791,975
---------- ---------- ----------
EXPENSES
Operating expenses 2,071,793 1,928,765 1,782,364
Depreciation and amortization 927,654 914,095 836,962
Interest 1,463,577 1,488,893 1,544,035
---------- ---------- ----------
Total expenses 4,463,024 4,331,753 4,163,361
---------- ---------- ----------
Net income/(loss) $ 22,932 $ (183,429) $ (371,386)
========== ========== ==========
BASIC AND DILUTED PER LIMITED
PARTNERSHIP UNIT DATA
Net income/(loss) $ 0.85 $ (6.81) $ (13.79)
========== ========== ==========
Weighted average limited
partnership units 26,926 26,926 26,926
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-4
<PAGE> 19
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
________________________________________________________________________________
<TABLE>
<CAPTION>
LIMITED PARTNERS
--------------------
GENERAL ORIGINAL CLASS A
PARTNER PARTNERS PARTNERS TOTAL
------- -------- -------- -----
<S> <C> <C> <C> <C>
Balance, December 31, 1996 $(287,663) $ -- $1,541,192 $1,253,529
Net loss (55,708) -- (315,678) (371,386)
--------- ----- ---------- ----------
Balance, December 31, 1997 (343,371) -- 1,225,514 882,143
Distributions -- -- (321,949) (321,949)
Net loss (27,514) -- (155,915) (183,429)
--------- ----- ---------- ----------
Balance, December 31, 1998 (370,885) -- 747,650 376,765
Distributions -- -- (513,667) (513,667)
Net income 3,440 -- 19,492 22,932
---------- ----- ---------- ----------
Balance, December 31, 1999 $(367,445) $ -- $ 253,475 $(113,970)
========= ===== ========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-5
<PAGE> 20
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
________________________________________________________________________________
<TABLE>
<CAPTION>
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 22,932 $ (183,429) $ (371,386)
Adjustments to reconcile net loss to net cash
provided by operating activities
Depreciation 871,628 862,828 836,961
Amortization of loan fees 56,026 51,267 20,103
Decrease (increase) in prepaid expenses
and other assets (95,122) 120,439 22,454
Increase (decrease) in
Accounts payable and accrued liabilities 2,382 21,676 67,028
Security deposits 18,580 (2,073) 16,895
Accrued interest payable (5,015) 76 2,231
---------- ---------- ----------
Net cash provided by operating activities 871,411 870,784 594,286
---------- ---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (144,218) (156,164) (252,031)
---------- ---------- ----------
Net cash used in investing activities (144,218) (156,164) (252,031)
---------- ---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments under mortgage debt (196,623) (185,679) (23,667)
Loan fees and refinancing costs - (7,016) (338,577)
Principal payments to affiliate (24,100) (50,360) (14,800)
Proceeds from affiliate loan - 10,000 72,500
Distributions (513,667) (321,949) -
---------- ---------- ----------
Net cash used by financing activities (734,390) (555,004) (304,544)
---------- ---------- ----------
Net (decrease)/increase in cash and cash
equivalents (7,197) 159,616 37,711
Cash and cash equivalents at beginning of year 441,909 282,293 244,582
---------- ---------- ----------
Cash and cash equivalents at end of year $ 434,712 $ 441,909 $ 282,293
========== ========== ==========
SUPPLEMENTAL CASH FLOWS INFORMATION
Cash paid for interest $1,463,577 $1,448,893 $1,337,417
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-6
<PAGE> 21
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
________________________________________________________________________________
1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Income Growth Partners, Ltd. X, a California limited partnership (the
"Limited Partnership"), and subsidiaries (collectively, the "Partnership")
was formed in February 1988, to acquire, operate and hold for investment
one or more parcels of income-producing, multi-family residential real
property. Currently, the Partnership owns a 264 unit building in San
Marcos, California ("Mission Park") and a 184 unit building in Vista,
California ("Shadow Ridge Meadows").
Income Growth Management, Inc. is the sole general partner. The general
partner has made no cash contributions to date. As of December 31, 1999,
there were approximately 2,039 limited partners in the Partnership.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Limited
Partnership and its subsidiaries. Subsidiaries consist primary of
California limited partnerships formed to hold and operate the
Partnership's properties. All significant intercompany balances and
transactions have been eliminated.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consists of cash and short-term investments with
original maturities at the date of purchase of 90 days or less.
LAND, BUILDINGS AND IMPROVEMENTS
Land, buildings and improvements are recorded at cost. Buildings and
improvements are depreciated using the straight-line method over the
estimated useful lives of 27.5 and 5 to 15 years, respectively.
Expenditures for maintenance and repairs are charged to expense as
incurred. Significant renovations and capitalized and depreciated over the
remaining life of the property.
The Partnership assesses its property for impairment whenever events or
changes in circumstances indicate that the carrying amount of the property
may not be recoverable. Recoverability of property to be held and used is
measured by a comparison of the carrying amount of the property to future
undiscounted net cash flows expected to be generated by the property. If
the property is considered to be impaired, the impairment to be recognized
is measured by the amount by which the carrying amount of the property
exceeds the fair value of the property.
The cost and related accumulated depreciation of real estate are removed
from the accounts upon disposition. Gains and losses arising from the
dispositions are reported as income or expense.
DEFERRED LOAN FEES
Deferred loan fees represent expenses incurred in obtaining the
Partnership's mortgage loans payable. These fees are being amortized to
interest expense over the initial term of the loan using the straight-line
method which approximates the effective interest method.
REVENUE RECOGNITION
Rental revenues are recognized at the beginning of each month based on the
current occupancy of the apartments. Tenant leases are generally for a term
of six months with an option to renew for an additional six months or to
rent on a month-to-month basis.
F-7
<PAGE> 22
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
________________________________________________________________________________
ADVERTISING COSTS
Advertising costs are expensed as incurred. Total advertising expense was
approximately $70,000, $58,000 and $52,000 for the years ended December
31, 1999, 1998 and 1997, respectively.
INCOME TAXES
No provision has been made for federal or state income taxes on the
operations of the Partnership. Such taxes are imposed on the individual
partners for their respective shares of Partnership income or loss. The
tax returns and amounts of allocable Partnership income or loss of the
Partnership are subject to examination by federal and state taxing
authorities. If such examinations result in a change in the Partnership
status, or in changes to allocable Partnership income or loss, the tax
liability of the Partnership or of the partners could be changed
accordingly.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to
make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the
date of financial statements, and the reported amounts of revenue and
expense during the reporting period. Actual results could differ from
estimates.
RECLASSIFICATIONS
Certain prior year amounts have been reclassified to conform with the
current year presentation.
COMPREHENSIVE INCOME
Other comprehensive income refers to changes in capital (net assets) which
do not result from investment by partners or distributions to partners.
Other comprehensive income consists of revenues, expenses, gains and
losses that, under accounting principles generally accepted in the United
States, are included in comprehensive income but are excluded from net
income as these amounts are recorded directly as an adjustment to
partners' capital. For the periods ending December 31, 1999, 1998 and
1997, the Company's comprehensive income was equal to the Company's net
income.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
There are no recently issued pronouncements for which the Partnership
expects a material impact on the Partnership's results of operations.
DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
CASH AND SHORT-TERM INVESTMENTS: The carrying amount approximates fair
value because of the short maturity of those instruments.
LONG-TERM DEBT: The fair value of the Partnership's long-term debt is
estimated based on the quoted market prices for the same or similar
issues or on the current rates offered to the Partnership for debt of
the same remaining maturities. The carrying values of the mortgage
loans on both the Mission Park and Shadow Ridge Meadows properties
approximates their respective fair values.
3. CONCENTRATION OF CREDIT RISK
UNINSURED CASH
The Partnership maintains cash accounts which may exceed FDIC insured
levels at one financial institution. All of the Partnership's cash
equivalents are held in a U.S. Treasury Money Fund which
F-8
<PAGE> 23
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
________________________________________________________________________________
invests in short-term U.S. Treasury securities. The Partnership has not
experienced any losses to date on its cash or cash equivalents.
NATURE OF BUSINESS
Changes in the national and regional economic climates, changes in local
real estate conditions, such as the oversupply of apartments or reduction
in demands for apartments, competition from single-family housing,
apartment properties and other forms of multifamily residential housing,
the inability to provide adequate maintenance and to obtain adequate
insurance, increased operating costs, changes in zoning, building,
environmental, rent control and other laws and regulations, the costs of
compliance with current and future laws, changes in real property taxes
and unusual occurrences (such as earthquakes and floods) and other factors
beyond the control of the Partnership may adversely affect the income
from, and value of, the Partnership's properties.
4. ACTIVITIES OF THE PARTNERSHIP
The general partner or its affiliates manage and control the affairs of
the Partnership and have general responsibility for supervising the
Partnership's properties and operations. The general partner and
affiliates are compensated for these efforts as explained in Note 7.
The original partnership agreement was amended in October 1994 and
provides that cash distributions from operations are to be determined at
the discretion of the general partner. After adequate working capital
reserves have been met, cash distributions deemed appropriate by the
general partner will be made as set forth, therein.
DISTRIBUTION OF CASH FROM OPERATIONS
The amended partnership agreement provides that any distributions of cash
from operations will be made in the following order of priority:
First, each Class A Unit receives a 12% cumulative noncompounded
annual return on the balance of actual funds invested in Class A
Units. Second, each Class A Unit receives a total return of original
invested capital. Third, each Class A Unit receives a $500 bonus.
Fourth, each Original Unit holder receives a 10% noncumulative return
on the adjusted balance of original invested capital. Thereafter, 90%
of distributions on cash from operations will be made to the Original
Unit holders and 10% to the general partner.
Distributions of $513,667 and $321,949 were made during 1999 and 1998,
respectively.
DISTRIBUTION OF CASH FROM SALE OR REFINANCING
The amended partnership agreement provides that any distributions of sale
or refinancing will be made in the following order of priority:
First, each Class A Unit receives a 12% cumulative noncompounded
annual return on the balance of actual funds invested in Class A
Units. Second, each Class A Unit receives a total return of original
invested capital. Third, each Class A Unit receives a $500 bonus.
Fourth, each Original Unit holder receives an amount equal to the
adjusted balance of original invested capital. Fifth, each Original
Unit holder receives a 10% cumulative return on the adjusted balance
of original invested capital (the "Preferred Return"). Thereafter,
85% of distributions of cash from operations will be made to the
Original Unit holders and 15% to the general partner.
F-9
<PAGE> 24
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
________________________________________________________________________________
ALLOCATION OF NET INCOME/LOSS
Net losses are allocated 85% to the limited partners and 15% to the
general partner. Losses in excess of the limited partners' capital
balances are allocated 100% to the general partner. Net income will be
allocated 100% to the general partner until the aggregate net income
allocated is equal to the aggregate net losses allocated to the general
partner in all previous years. The balance of net income after the initial
allocation to the general partner, shall be allocated 85% to the limited
partners and 15% to the general partner.
6. MORTGAGE LOANS AND LOAN PAYABLE TO AFFILIATE
At December 31, 1999 and 1998, mortgage loans and loan payable to
affiliate consisted of the following:
<TABLE>
<CAPTION>
1999 1998
----------- -----------
<S> <C> <C>
Mission Park - Note dated December 27, 1995,
collateralized by first trust deed on land and buildings
and a guarantee by officers of the general partner,
interest and principal of $73,144 payable monthly based on
7.76% fixed annual interest rate, amortized over 30 years,
balloon payment of approximately $8,918,000 due in
January 2006. $9,806,865 $9,917,901
Shadow Ridge Meadows - Note dated October 27, 1997,
collateralized by first trust deed on land and buildings,
interest and principal of $68,106 payable monthly based on
7.49% fixed annual interest rate, amortized over 30 years,
balloon payment of approximately $8,475,000 due in
November 2007. 9,576,035 9,661,662
----------- -----------
19,382,900 19,579,523
Notes payable to ENA, affiliate of general partner -
promissory note dated December 27, 1995, with simple
interest and principal payable from time to time at the
published prime rate, stated as 8.5% at December 31, 1997,
and due upon demand 24,593 28,593
Note payable to Income Growth Property Management,
affiliate of the general partner - promissory note dated
October 23, 1997, with simple interest and principal
payable from time to time at the published prime rate,
stated as 8.5% at December 31, 1997, and due upon demand 23,947 44,047
----------- -----------
$19,431,440 $19,652,163
=========== ===========
</TABLE>
Future minimum annual principal payments are summarized as follows:
<TABLE>
<S> <C>
2000 $ 274,716
2001 244,060
2002 263,360
2003 284,186
2004 306,660
Thereafter 18,058,458
-----------
$19,431,440
===========
</TABLE>
F-10
<PAGE> 25
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES
A CALIFORNIA LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND 1998
________________________________________________________________________________
7. RELATED PARTY TRANSACTIONS
Following is a description of related party transactions for the three
years ended December 31, 1999 that have not otherwise been disclosed:
MANAGEMENT FEES
The Partnership's properties are managed by an affiliate of the general
partner who receives management fees.
The fee for Mission Park is equal to 5% of the operating revenues generated
by that property. The fee for Shadow Ridge Meadows was equal to 4% of the
operating revenues generated by that property through October 1997 and 5%
thereafter.
Management fees aggregated approximately $226,000, $207,300 and $179,000 in
1999, 1998 and 1997, respectively.
ADMINISTRATIVE COSTS
The Partnership has an agreement with an affiliate of the general partner
(the "Affiliate") who furnishes certain administrative services and
facilities to the Partnership, including accounting, data processing,
duplication and transfer agent expenses, professional (including, but not
limited to, regulatory reporting and legal services) and recording and
partner communications expenses. The agreement provides for reimbursement
to the affiliate for actual costs incurred. Reimbursements paid to the
Affiliate under the provisions of this agreement aggregated approximately
$130,000, $99,000 and $113,000 in 1999, 1998 and 1997, respectively.
NOTE RECEIVABLE FROM GENERAL PARTNER
At December 31, 1999 and 1998, a non-interest bearing note receivable of
$10,000 was due from the general partner for their initial partnership
capital contribution.
DEBT PLACEMENT FEES
During 1997 and 1995, the Partnership issued notes payable to an affiliate
of the general partner for payment of debt placement fees of $97,500 and
$102,000, respectively. Debt placement fees were equal to 1% of the
principal amounts of the new third party financing. At December 31, 1999
and 1998, the aggregate balances of these notes were $48,540 and $72,640,
respectively (See Note 6).
SUBORDINATED REAL ESTATE BROKERAGE COMMISSIONS
If the general partner, or any of its affiliates, render services in
negotiating and implementing the sale of Partnership properties, the
general partner or such affiliates will be paid a real estate brokerage
commission in an amount up to one-half of the commission customarily
charged in arm's-length transactions but not in excess of 3% of the
contract price for the property. Payment of such commission (other than
payments in the form of promissory notes that are subordinated to the
return of capital contributions to limited partners) shall be deferred
until the limited partners have received distributions equal to their total
original invested capital, plus the 10% Preferred Return described in Note
5. No properties were sold in 1999, 1998 or 1997 and, accordingly, no
brokerage commissions were paid by the Partnership.
F-11
<PAGE> 26
INCOME GROWTH PARTNERS, LTD. X AND SUBSIDIARIES SCHEDULE III
A CALIFORNIA LIMITED PARTNERSHIP
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
FOR THE YEAR ENDED DECEMBER 31, 1999
________________________________________________________________________________
<TABLE>
<CAPTION>
NET CHANGE GROSS AMOUNT AT WHICH
INITIAL COST SUBSEQUENT TO ACQUISITION CARRIED AT CLOSE OF PERIOD
------------------------ --------------------------- --------------------------
BUILDINGS AND BUILDINGS AND BUILDINGS AND
ENCUMBRANCES LAND IMPROVEMENTS LAND IMPROVEMENTS LAND IMPROVEMENTS TOTAL
------------- ---- ------------- ---- ------------- ---- ------------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Shadow Ridge
Meadows $ 9,576,035 $3,294,260 $13,490,802 $(400,000) $ 227,792 $2,894,260 $13,718,594 $16,612,854
Mission Park 9,806,865 4,484,105 9,821,589 (300,000) (1,632,722) 4,184,105 8,188,867 $12,372,972
----------- ---------- ----------- --------- ----------- ---------- ----------- -----------
$19,382,900 $7,778,365 $23,312,391 $(700,000) $(1,404,930) $7,078,365 $21,907,461 $28,985,826
=========== ========== =========== ========= =========== ========== =========== ===========
</TABLE>
<TABLE>
<CAPTION>
LIFE ON WHICH
DEPRECIATION IN
ACCUMULATED DATE OF DATE LATEST STATEMENTS
DEPRECIATION CONSTRUCTION ACQUIRED IS COMPUTED
------------- ------------ -------- -----------------
<S> <C> <C> <C> <C>
Shadow Ridge
Meadows $ 4,850,720 Jan. 1988 Nov. 1988 27.5 Years
Mission Park 5,466,229 May 1989 Aug. 1989 27.5 Years
----------- ----------
$10,316,949
===========
</TABLE>
(a) Reconciliation of total real estate carrying value for the three years
ended December 31, 1999:
<TABLE>
<CAPTION>
1999 1998 1997
----------- ----------- -----------
<S> <C> <C> <C>
Balance at beginning of year $28,841,606 $28,685,443 $28,433,411
Acquisitions 144,220 156,163 252,032
----------- ----------- -----------
Balance at end of year $28,985,826 $28,841,606 $28,685,443
=========== =========== ===========
</TABLE>
(b) Reconciliation of accumulated depreciation for the three years ended
December 31, 1999:
<TABLE>
<CAPTION>
1999 1998 1997
----------- ---------- ----------
<S> <C> <C> <C>
Balance at beginning of year $9,445,320 $8,582,492 $7,745,530
Expense 871,629 862,828 836,962
----------- ----------- -----------
</TABLE>
F-12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS FILED WITH THE REGISTRANT'S FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999
<CASH> 434,712
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 28,985,826
<DEPRECIATION> (10,316,949)
<TOTAL-ASSETS> 19,818,470
<CURRENT-LIABILITIES> 0
<BONDS> 19,382,900
0
0
<COMMON> 0
<OTHER-SE> (113,970)
<TOTAL-LIABILITY-AND-EQUITY> 19,818,470
<SALES> 0
<TOTAL-REVENUES> 4,485,956
<CGS> 0
<TOTAL-COSTS> 2,071,793
<OTHER-EXPENSES> 927,654
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,463,577
<INCOME-PRETAX> 22,932
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 22,932
<EPS-BASIC> 0.85
<EPS-DILUTED> 0
</TABLE>
