SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
___________
FORM 10Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
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 33-23463
CLOVER APPRECIATION PROPERTIES I, L.P
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
22-2898428
(IRS employer identification no.)
23 WEST PARK AVENUE, MERCHANTVILLE, NEW JERSEY 08109
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (609) 662-1116
________________________________________________________________
Former name, address and former fiscal year, if changed since last report
Indicate by check 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
<TABLE>
CLOVER APPRECIATION PROPERTIES I, L.P.
BALANCE SHEETS
(Unaudited)
ASSETS
<CAPTION>
September 30, December 31,
1995 1994____
<S> <C> <C>
CURRENT ASSETS
Cash $ 171,410 $ 118,590
Prepaid expenses 4,364 2,733
Rents receivable 4,447 -
Real estate tax escrow 46,858 34,697
Total current assets 227,079 156,020
INVESTMENT PROPERTY, at cost 10,090,130 10,090,130
Less - accumulated depreciation 1,742,403 1,540,362
Net investment property 8,347,727 8,549,768
OTHER ASSETS
Utility deposits 770 770
TOTAL ASSETS $ 8,575,576 $ 8,706,558
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES
Current maturities of mortgage payable $ 68,349 $ 63,903
Accounts payable 32,218 58,414
Accrued interest 55,588 55,944
Accrued expenses 55,753 17,187
Tenants' security deposits 37,416 30,257
Prepaid rents 8,291 16,946
Total current liabilities 257,615 242,651
MORTGAGE PAYABLE,
Less current maturities 7,343,440 7,395,273
DUE TO AFFILIATES 808,896 799,774
Total liabilities 8,409,951 8,437,698
PARTNERS' CAPITAL
General partner (deficit) (34,801) (33,769)
Limited partners 200,426 302,629
Total partners' capital 165,625 268,860
TOTAL LIABILITIES AND PARTNERS'
CAPITAL $ 8,575,576 $ 8,706,558
</TABLE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
CLOVER APPRECIATION PROPERTIES I, L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Nine Months Ended
September 30, 1995 September 30, 1994
<S> <C> <C>
REVENUES
Rental income $ 1,112,396 $ 1,042,051
Other income - 1,561
Interest Income 353 1,262
Total revenues 1,112.749 1,044,874
EXPENSES
Professional services 14,048 30,952
Interest 502,735 507,365
Operating expenses(Including affiliate
transactions of $9,122 and $60,817
for the nine months ended 09/30/95
and 09/30/94, respectively) 497,160 495,085
Depreciation 202,041 199,138
Total expenses 1,215,984 1,232,540
NET (LOSS) $ (103,235) $ (187,666)
NET (LOSS) PER LIMITED
PARTNERSHIP UNIT $ (28.46) $ (51.74)
</TABLE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
CLOVER APPRECIATION PROPERTIES I, L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Three Months Ended
September 30, 1995 September 30, 1994
<S> <C> <C>
REVENUES
Rental income $ 382,312 $ 355,908
Other income - 234
Interest Income - 416
Total revenues 382,312 356,558
EXPENSES
Professional services 5,399 4,031
Interest 167,887 168,783
Operating expenses (Including affiliate
transactions of $0 and $19,478 for
the three months ended 09/30/95 and
09/30/94, respectively) 190,919 166,730
Depreciation 67,347 66,380
Total expenses 431,552 405,924
NET (LOSS) $ (49,240) $ (49,366)
NET (LOSS) PER LIMITED
PARTNERSHIP UNIT $ (13.57) $ (13.61)
</TABLE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
CLOVER APPRECIATION PROPERTIES I, L.P.
STATEMENT OF PARTNERS' CAPITAL (DEFICIT)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995
(Unaudited)
<CAPTION>
General Limited
Partner Partners Total
<S> <C> <C> <C>
Balances (Deficit) at
January 1, 1995 $ (33,769) $ 302,629 $ 268,860
Net (loss) for the nine months
ended September 30, 1995 (1,032) (102,203) (103,235)
Balances (Deficit) at
September 30, 1995 $ (34,801) $ 200,426 $ 165,625
</TABLE>
The accompanying notes are an integral part of these financial statements.
<TABLE>
CLOVER APPRECIATION PROPERTIES I, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
For the Nine Months Ended
September 30, 1995 September 30, 1994
<S> <C> <C>
OPERATING ACTIVITIES
Cash received from rentals $ 1,099,294 $ 1,071,991
Cash paid for operating expenses (496,349) (484,906)
Interest received 353 1,262
Interest paid (503,091) (507,690)
Other income received - 1,561
Net cash provided by operating
activities 100,207 82,218
FINANCING ACTIVITIES
Repayment of mortgage payable (47,387) (43,322)
Net increase in cash 52,820 38,896
Cash, beginning of period 118,590 102,644
Cash, end of period $ 171,410 $ 141,540
RECONCILIATION OF NET (LOSS) TO NET CASH
PROVIDED BY OPERATING ACTIVITIES
NET (LOSS) $ (103,235) $ (187,666)
Adjustments
Depreciation 202,041 199,138
(Increase) decrease in prepaid
expenses (1,631) 4,476
(Increase) decrease in rents
receivable (4,447) 5,588
(Increase) in real estate tax escrow (12,161) (37,309)
(Decrease) in accounts payable (26,196) (10,233)
Increase in security deposits 7,159 7,190
(Decrease) increase in prepaid rents (8,655) 17,162
Increase in accrued expenses 38,566 25,940
Increase in due to affiliates 9,122 58,257
(Decrease) in accrued interest (356) (325)
Total adjustments 203,442 269,884
NET CASH PROVIDED BY OPERATING
ACTIVITIES $ 100,207 $ 82,218
</TABLE>
The accompanying notes are an integral part of these financial statements.
CLOVER APPRECIATION PROPERTIES I, L.P.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1995
(Unaudited)
Readers of this quarterly report should refer to the
Partnership's audited financial statements as of December 31,
1994, as certain footnote disclosures which would
substantially duplicate those contained in such audited
financial statements have been omitted from this report.
1. Investment Property:
On January 25, 1989, the Partnership acquired the Royal Wood
Apartments, a 256-unit residential complex located in Stone
Mountain, Georgia.
The investment property at September 30, 1995 consists of:
Land $ 1,171,749
Apartment buildings 8,138,448
Furniture and fixtures 779,933
10,090,130
Less: accumulated depreciation 1,742,403
$ 8,347,727
2. Transactions with Affiliates:
Effective February 21, 1995, NPI-CL Management, L.P. ("NPI")
which is unaffiliated with the General Partner, replaced an
affiliate of the General Partner as Property Manager. Until
this time, as compensation for property management services
performed by an affiliate of the General Partner with
respect to the Property, the affiliate was entitled to a
management fee in an amount not to exceed 5% of gross
revenues. These fees were accrued but cannot be paid until
the mortgage payable is satisfied.
Per the loan modification agreement, only approved expenses,
which are expenses that relate to the operation, management
or ownership of the property, are permitted to be paid.
CLOVER APPRECIATION PROPERTIES I, L.P.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SEPTEMBER 30, 1995
(Unaudited)
2. Transactions with Affiliates (continued):
Approved expenses did not include management fees and
payments to reimburse the General Partner and its affiliates
except for health insurance costs and computer fees.
Certain reimbursable costs due to the affiliate have also
been accrued.
The General Partner and its affiliates have made certain
advances to enable the Partnership to avoid incurring late
charges on the mortgage payable which is due on the first
day of each month, prior to the receipt of monthly rents
from residents. As of September 30, 1995, advances due to
the General Partner and its affiliates were $321,293.
<TABLE>
<CAPTION>
Reimbursable
Management Costs and
Fees Advances
<S> <C> <C>
Due to affiliates balance at
January 1, 1995 $ 376,439 $ 423,335
Incurred/received during the
nine months ended
September 30, 1995 8,610 512
Paid during the nine months
ended September 30, 1995 - -
Due to affiliates balance at
September 30, 1995 $ 385,049 $ 423,847
</TABLE>
3. General:
The financial statements reflect all adjustments which are,
in the opinion of the General Partner, necessary for a fair
statement of results for the interim period presented. Such
adjustments are of a normal recurring nature.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Financial Condition; Liquidity and Capital Resources
The Partnership owns one residential apartment complex
located in DeKalb County, Georgia. The Partnership acquired
Royal Wood Apartments on January 25, 1989 from an unaffiliated
third party. The Partnership derives its revenues from rental
income from its property and is responsible for operating
expenses, administrative expenses, capital improvements and debt
service payments.
On September 30, 1995, the Partnership had cash on hand of
$171,410, including cash reserves of $129,409 and $42,001 in
security deposits. Total cash on hand on December 31, 1994 of
$118,590 included cash reserves of $88,920 and $29,670 in security
deposits. While the Partnership is currently able to satisfy its
current obligations with cash flows from operations, the General
Partner believes that if there should be a reversal of the real
estate market in the locality where the Royal Wood Apartments is
located, then it would be likely that the Partnership's current
funds, together with cash flows from operations, would not be
sufficient to meet the Partnership's liquidity requirements. The
Partnership's working capital deficit was $30,536 on September 30,
1995 as compared to $86,631 on December 31, 1994. The decrease in
the deficit is primarily attributable to an increase in cash and a
decrease in accounts payable, partially offset by an increase in
accrued expenses.
The Partnership's net cash flow from operations was $100,207
for the nine months ended September 30, 1995 as compared to
$82,218 for the same period in 1994. The increase in net cash flow
from operations during the nine months ended September 30, 1995 is
primarily attributable to an increase in cash received from
rentals partially offset by an increase in cash paid for operating
expenses and decreases in interest received and other income. No
distributions to partners were made during the nine months ended
September 30, 1995, and it is unlikely that distributions will be
made in the foreseeable future.
As of September 30, 1995, the Partnership owed a total of
$808,896 to Clover and its affiliates, including $385,049 in
accrued property management fees and $423,847 in reimbursable
costs and advances made to or on behalf of the Partnership. The
payment of such costs will be made from the Partnership's cash
flow when available (subject to the restrictions imposed by the
Partnership's mortgage loan) and from the proceeds of any sales or
refinancing of Partnership assets.
Effective February 21, 1995, the General Partner and certain
of its affiliates entered into an agreement with NPI-CL
Management L.P. ("NPI"), an entity unaffiliated with the
Partnership or its General Partner, pursuant to which NPI began
providing day-to-day asset management services for the
Partnership as well as property management services for the
Partnership. NPI is an affiliate of National Property Investors,
Inc., a diversified real estate management company with offices
in Jericho, New York and Atlanta, Georgia.
On August 17, 1995 the partners of NPI agreed to sell their
interest in NPI to an affiliate of Insignia Financial Group, Inc.
("Insignia"). According to Commercial Property News and the
National Multi-Housing Council, Insignia is the largest property
manager in the United States. The sale of the partnership
interest in NPI is subject to certain conditions and is expected
to close in January 1996. The General Partner does not believe
this transaction will have a significant impact on the
Partnership.
Results of Operations
Total revenues for the three and nine months ended September
30, 1995 were $382,312 and 1,112,749, respectively, as compared to
$356,558 and $1,044,874 for the same periods in 1994. The
increase in total revenues for the three and nine months ended
September 30, 1995 is attributable to an increase in rental
revenues.
Rental income for the three and nine months ended September
30, 1995 was $382,312 and 1,112,396, respectively, as compared to
$355,908 and $1,042,051 for the same periods in 1994. The
increase in rentals is primarily attributable to an increase in
average occupancy and rent increases as well as a decrease in
write-offs and concessions in 1995.
The average effective rentals per unit for the three and nine
months ended September 30, 1995 were $1,584 and $4,563,
respectively, as compared to $1,483 and $4,342 for the same
periods in 1994. The average occupancy for the three and nine
months ended September 30, 1995 was 94.3% and 95.2%, respectively,
as compared to 94.3% and 93.8% for the same periods in 1994. The
increase in the average occupancy for the nine month period ended
September 30, 1995 is primarily due to the general improvement in
the residential real estate market in the surrounding area.
Operating expenses for the three and nine months ended
September 30, 1995 were $190,919 and $497,160, respectively, as
compared to $166,730 and $495,085 for the same periods in 1994.
The increase in operating expenses is primarily due to an increase
in payroll and related costs, cleaning and decorating expenses and
real estate taxes, partially offset by a decrease in management
fees effective with NPI's assumption of management responsibility.
Professional expenses for the three and nine months ended
September 30, 1995 were $5,399 and $14,048, respectively, as
compared to $4,031 and $30,952 for the same periods in 1994. The
decrease in professional expenses for the nine months ended
September 30, 1995 is primarily attributable to the settlement of
a lawsuit in the first quarter of 1994 in which the Partnership
paid a $10,000 deductible not covered by the insurance company and
associated legal expenses. There were no comparable expenses for
the nine months ended September 30, 1995.
The Partnership had net income before depreciation of $18,107
and $98,806 for the three and nine months ended September 30, 1995
as compared to a $17,014 and $11,472 for the same periods in 1994.
The increase in net income before depreciation for the three and
nine months ended September 30, 1995 is primarily attributable to
an increase in rental income partially offset by an increase in
operating expenses.
PART II-OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
No report on Form 8-K was required to be filed during
the period.
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 hereunto duly authorized.
CLOVER APPRECIATION PROPERTIES I, L.P.
(Registrant)
By: Crown Management Corporation
By: /S/ Donald N. Love
Donald N. Love, President
By: /S/ Stanley E. Borucki
Stanley E. Borucki, Treasurer
Date: November 13, 1995
8
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the
Quarterly Report on Form 10-Q for the quarter ended September 30, 1995 for
Clover Appreciation Properties I, L.P. and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 171,410
<SECURITIES> 0
<RECEIVABLES> 4,447
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 227,079
<PP&E> 10,090,130
<DEPRECIATION> (1,742,403)
<TOTAL-ASSETS> 8,575,576
<CURRENT-LIABILITIES> 257,615
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 165,625
<TOTAL-LIABILITY-AND-EQUITY> 8,575,576
<SALES> 0
<TOTAL-REVENUES> 1,112,749
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 713,249
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 502,735
<INCOME-PRETAX> (103,235)
<INCOME-TAX> 0
<INCOME-CONTINUING> (103,235)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (103,235)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
