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Form 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1997
OR
[ ] 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 0-18382
ATLANTIC INCOME PROPERTIES LIMITED PARTNERSHIP
(Exact name of Registrant as specified in its charter)
North Carolina 56-1623861
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
INTERSTATE TOWER
SUITE 1500
P. O. BOX 1012
CHARLOTTE, NORTH CAROLINA 28201-1012
(Address of executive offices)
(Zip Code)
(704)379-9164
Registrant's telephone number, including area code:
NOT APPLICABLE
(Former Name, former address and former fiscal year,
if changed since last report)
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 twelve months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to the foregoing filing
requirements for the past 90 days.
Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date.
508,594 Beneficial Unit Certificates outstanding as of April 30, 1997.
Page 1 of 8 sequentially numbered pages
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ATLANTIC INCOME PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1997 AND DECEMBER 31, 1996
AMENDED
<TABLE>
<CAPTION>
March 31,
1997 December 31,
(unaudited) 1996
------------ ------------
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 32,514 $ 266,603
Restricted cash and cash equivalents 137,178 94,699
Receivables, net of allowance 242,201 309,164
Rental property:
Land 4,567,041 4,567,041
Buildings and Improvements 19,505,044 19,262,045
------------ ------------
24,072,085 23,829,086
Less accumulated depreciation (3,944,932) (3,944,932)
------------ ------------
20,127,153 19,884,154
Deferred loan costs, net of accumulated
amortization of $89,206 and $206,849 at March 31,
1997 and December 31, 1996, respectively 54,207 19,317
Other 48,269 0
------------ ------------
$ 20,641,522 $ 20,573,937
============ ============
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
Long-term debt $ 14,143,887 $ 14,250,705
Accounts payable and accrued expenses 302,859 247,436
Due to general partners and affiliates 484,575 493,576
Tenants' security deposits 58,241 55,085
------------ ------------
14,989,562 15,046,802
Partners' equity (deficit):
General partners 21,616 12,069
Limited Partners beneficial unit certificates,
authorized 1,000,000 units, issued and outstanding
508,594 and 508,594 units at March 31, 1997, and
December 31, 1996, respectively 5,630,344 5,515,066
------------ ------------
5,651,960 5,527,135
------------ ------------
$ 20,641,522 $ 20,573,937
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements
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ATLANTIC INCOME PROPERTIES LIMITED PARTNERSHIP
STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(unaudited)
AMENDED
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
March 31, March 31,
1997 1996
-------- ---------
<S> <C> <C>
Revenue:
Rental Income $741,127 $ 715,719
Interest and other income 5,438 8,333
-------- ---------
746,565 724,052
Expenses:
Interest 319,358 328,091
Depreciation and amortization 7,033 177,723
Other operating expenses 229,243 232,345
-------- ---------
555,634 738,159
-------- ---------
NET INCOME (LOSS) 190,931 (14,107)
======== =========
Net income (loss) per Beneficial Unit Certificate $ 0.38 ($ 0.03)
======== =========
Beneficial Unit Certificates
Outstanding--weighted average 508,594 508,594
======== =========
</TABLE>
The accompanying notes are an integral part of the financial statements
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ATLANTIC INCOME PROPERTIES LIMITED PARTNERSHIP
STATEMENT OF PARTNERS' EQUITY (DEFICIT)
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(unaudited)
AMENDED
<TABLE>
<CAPTION>
General Limited
Partners Partners Total
------------- --------------- ----------------
<S> <C> <C> <C>
Partners' equity (deficit) at December 31, 1995 $ 5,344 $ 5,646,985 $ 5,652,329
Net loss for the three months ended
March 31, 1996 ($141) ($13,966) ($14,107)
Distributions to partners 0 (63,606) (63,606)
-------- ----------- -----------
PARTNERS' EQUITY (DEFICIT) AT
March 31, 1996 $ 5,203 $ 5,569,413 $ 5,574,616
======== =========== ===========
Partners' equity (deficit) at December 31, 1996 $ 12,069 $ 5,515,066 $ 5,527,135
Net income for the three months ended
March 31, 1997 $ 9,547 $ 181,384 $ 190,931
Distributions to partners 0 (66,106) (66,106)
-------- ----------- -----------
PARTNERS' EQUITY (DEFICIT) AT
March 31, 1997 $ 21,616 $ 5,630,344 $ 5,651,960
======== =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements
4
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ATLANTIC INCOME PROPERTIES LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(unaudited)
AMENDED
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
March 31, March 31,
1997 1996
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ 190,931 ($ 14,107)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization 7,033 177,723
Decrease in rents receivable, net 66,963 162,545
Decrease in amounts due to General Partners and Affiliates (9,001) (9,000)
Increase in accounts payable and accrued expenses 55,423 29,788
Increase (Decrease) in tenant's security deposits 3,156 (1,814)
Increase in other assets (48,269) (12,528)
--------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES 266,236 332,607
--------- ---------
INVESTING ACTIVITIES
Increase in building improvements (242,999) 0
--------- ---------
NET CASH USED BY INVESTING ACTIVITIES (242,999) 0
--------- ---------
FINANCING ACTIVITIES
Increase in deferred building and loan costs (41,923) (6,588)
Mortgage principal reduction (106,818) (98,106)
Distributions to Limited Partners (66,106) (63,606)
Increase in restricted cash and cash equivalents (42,479) (10,545)
--------- ---------
NET CASH USED BY FINANCING ACTIVITIES (257,326) (178,845)
--------- ---------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (234,089) 153,762
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 266,603 483,885
--------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 32,514 $ 637,647
========= =========
</TABLE>
The accompanying notes are an integral part of the financial statements
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ATLANTIC INCOME PROPERTIES LIMITED PARTNERSHIP
ITEM 2.-MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
LIQUIDITY AND CAPITAL RESOURCES.
The Registrant paid a distribution on April 15, 1997, for the quarter ended
March 31, 1997, at an annualized rate of two and one-half percent. The
Registrant intends to continue the quarterly distribution at this rate in 1997.
As of March 31, 1997, the Registrant had cash and cash equivalents of $32,514.
The Registrant also held restricted cash and cash equivalents of $137,178 which
includes property tax escrows and tenant security deposits at March 31, 1997.
The Registrant is holding these cash reserves for anticipated tenant expansion
costs and other necessary capital improvements. On April 9, 1997, the Registrant
established a line of credit borrowing facility with First Citizens Bank and
Trust Company. Borrowing capacity under the line of credit is $250,000 with
balances accruing interest at prime plus 1%.
The Partnership has been unsuccessful in refinancing the mortgage note payable
secured by West Ridge Plaza, originally maturing in December 1995 and extended
to December 1996. However, the Partnership has received verbal confirmation from
the lender that loan payments will be accepted through December 31, 1997. The
Partnership continues to make normal monthly payments of principal and interest
on this loan.
The mortgage notes payable secured by Southwest Plaza and Lincoln Center matured
in April 1997 and were extended to December 15, 1997. As part of the extension,
the interest rates on the notes were increased from 8.4% to 10.0%.
In light of the expiration of extension agreements for loans secured by West
Ridge Plaza, Southwest Plaza and Lincoln Center, the general partners will seek
to either payoff or extend the maturity date of the loans upon expiration. The
payoff cannot occur without either selling the properties or securing additional
debt financing, which the general partners believe is currently available, in
amounts and upon terms acceptable to the Partnership.
RESULTS OF OPERATIONS.
The Partnership recorded net income for the three months ended March 31, 1997,
of $190,931 as compared to a net loss of $14,107 in 1996. The change is due to
the following factors:
Rental income increased approximately $25,408 for the three months ended March
31, 1997, as compared to the three months ended March 31, 1996. This increase
was primarily due to scheduled rent increases as well as continued high
occupancy levels at the properties.
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Interest expense decreased from $328,091 for the three months March 31, 1996, to
$319,358 for the three months ended March 31, 1997, due to an increased portion
of payments attributable to principal rather than interest.
Depreciation and amortization expense decreased $170,690 to $7,033 in the first
quarter in accordance with the accounting policy to discontinue depreciating
assets held for sale.
Operating expenses for the three months ended March 31, 1997, decreased slightly
compared to the same period in 1996. The 1996 figure was influenced by several
factors, including increased snow removal costs and higher common area
maintenance expense resulting from several one time charges to improve the
appearance of the common areas.
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ATLANTIC INCOME PROPERTIES LIMITED PARTNERSHIP
AMENDED
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.
ATLANTIC INCOME PROPERTIES
A NORTH CAROLINA LIMITED PARTNERSHIP
------------------------------------------------
(REGISTRANT)
BY: /S/ J. CHRISTOPHER BOONE
-------------------------------------------
J. CHRISTOPHER BOONE
ISC REALTY CORPORATION,
GENERAL PARTNER AND PRINCIPAL EXECUTIVE
OFFICER, PRINCIPAL FINANCIAL OFFICER OF THE
REGISTRANT
DATE: NOVEMBER 18, 1997
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