<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the balance
sheet of CNL Income Fund V, Ltd. at June 30, 1996, and its statement of income
for the six months then ended and is qualified in its entirety by reference to
the Form 10-Q of CNL Income Fund V, Ltd. for the six months ended June 30,
1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 306,327
<SECURITIES> 0
<RECEIVABLES> 96,120
<ALLOWANCES> 11,072
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 18,769,088
<DEPRECIATION> 2,318,895
<TOTAL-ASSETS> 20,555,846
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 19,455,878
<TOTAL-LIABILITY-AND-EQUITY> 20,555,846
<SALES> 0
<TOTAL-REVENUES> 1,101,043
<CGS> 0
<TOTAL-COSTS> 333,916
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 802,918
<INCOME-TAX> 0
<INCOME-CONTINUING> 802,918
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 802,918
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>Due to the nature of its industry, CNL Income Fund V, Ltd. has an unclassi-
fied balance sheet; therefore, no values are shown above for current assets and
current liabilities.
</FN>
</TABLE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
-----------------------------------
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
0-19141
----------------------
CNL Income Fund V, Ltd.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 59-2922869
- ---------------------------- -------------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organiza- Identification No.)
tion)
400 E. South Street, #500
Orlando, Florida 32801
- ---------------------------- -------------------------------
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number
(including area code) (407) 422-1574
-------------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 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
------- -------
CONTENTS
--------
Part I Page
----
Item 1. Financial Statements:
Condensed Balance Sheets 1
Condensed Statements of Income 2
Condensed Statements of Partners' Capital 3
Condensed Statements of Cash Flows 4
Notes to Condensed Financial Statements 5
Item 2. Management's Discussion and Analysis
of Financial Condition and
Results of Operations 6-9
Part II
Other Information 10
CNL INCOME FUND V, LTD.
(A Florida Limited Partnership)
CONDENSED BALANCE SHEETS
June 30, December 31,
ASSETS 1996 1995
----------- ------------
Land and buildings on operating
leases, less accumulated
depreciation of $2,318,895 and
$2,128,453 $16,450,193 $16,640,635
Net investment in direct financing
leases 1,964,893 1,987,793
Investment in joint ventures 469,464 473,138
Mortgage note receivable, less
deferred gain of $141,191
and $141,641 892,888 895,736
Cash and cash equivalents 306,327 319,052
Receivables, less allowance for
doubtful accounts of $11,072
and $4,490 85,048 68,204
Prepaid expenses 9,170 11,921
Accrued rental income 323,517 309,357
Other assets 54,346 54,346
----------- -----------
$20,555,846 $20,760,182
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 18,403 $ 13,963
Accrued real estate taxes payable 103,935 84,135
Distributions payable 575,000 575,000
Due to related parties 99,783 61,519
Rents paid in advance 14,520 29,370
----------- -----------
Total liabilities 811,641 763,987
Minority interest 288,327 301,435
Partners' capital 19,455,878 19,694,760
----------- -----------
$20,555,846 $20,760,182
=========== ===========
See accompanying notes to condensed financial statements.
CNL INCOME FUND V, LTD.
(A Florida Limited Partnership)
CONDENSED STATEMENTS OF INCOME
Quarter Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
-------- -------- ---------- ----------
Revenues:
Rental income from
operating leases $449,664 $470,223 $ 899,329 $ 965,980
Earned income from
direct financing leases 46,463 47,493 93,070 95,114
Contingent rental income 2,585 15,186 40,287 24,121
Interest and other income 32,907 21,295 68,357 25,594
-------- -------- ---------- ----------
531,619 554,197 1,101,043 1,110,809
-------- -------- ---------- ----------
Expenses:
General operating and
administrative 46,468 32,213 98,231 56,259
Professional services 2,996 8,821 10,933 12,722
Real estate taxes 7,914 16,136 21,818 28,451
State and other taxes 151 166 12,492 15,982
Depreciation 95,221 101,712 190,442 203,423
-------- -------- ---------- ----------
152,750 159,048 333,916 316,837
-------- -------- ---------- ----------
Income Before Minority
Interest in Loss (Income)
of Consolidated Joint
Venture, Equity
in Earnings of Uncon-
solidated Joint Ventures
and Gain on Sale of Land
and Building 378,869 395,149 767,127 793,972
Minority Interest in Loss
(Income) of Consolidated
Joint Venture 6,262 (8) 13,108 2,894
Equity in Earnings of
Unconsolidated Joint
Ventures 11,288 11,417 22,233 22,557
Gain on Sale of Land and
Building 228 - 450 -
-------- -------- ---------- ----------
Net Income $396,647 $406,558 $ 802,918 $ 819,423
======== ======== ========== ==========
Allocation of Net Income:
General partners $ 3,966 $ 4,066 $ 8,029 $ 8,194
Limited partners 392,681 402,492 794,889 811,229
-------- -------- ---------- ----------
$396,647 $406,558 $ 802,918 $ 819,423
======== ======== ========== ==========
Net Income Per Limited
Partner Unit $ 7.85 $ 8.05 $ 15.90 $ 16.22
======== ======== ========== ==========
Weighted Average Number
of Limited Partner
Units Outstanding 50,000 50,000 50,000 50,000
======== ======== ========== ==========
See accompanying notes to condensed financial statements.
CNL INCOME FUND V, LTD.
(A Florida Limited Partnership)
CONDENSED STATEMENTS OF PARTNERS' CAPITAL
Six Months Ended Year Ended
June 30, December 31,
1996 1995
---------------- ------------
General partners:
Beginning balance $ 203,960 $ 155,706
Contributions 108,200 31,500
Net income 8,029 16,754
----------- -----------
320,189 203,960
----------- -----------
Limited partners:
Beginning balance 19,490,800 20,127,734
Net income 794,889 1,663,066
Distributions ($23.00 and
$46.00 per limited partner
unit, respectively) (1,150,000) (2,300,000)
----------- -----------
19,135,689 19,490,800
----------- -----------
Total partners' capital $19,455,878 $19,694,760
=========== ===========
See accompanying notes to condensed financial statements.
CNL INCOME FUND V, LTD.
(A Florida Limited Partnership)
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended
June 30,
1996 1995
----------- -----------
Increase (Decrease) in Cash and Cash
Equivalents:
Net Cash Provided by Operating
Activities $ 1,025,805 $ 1,115,466
----------- -----------
Cash Flows from Investing Activities:
Collections on mortgage note
receivable 3,270 -
----------- -----------
Net cash provided by investing
activities 3,270 -
----------- -----------
Cash Flows from Financing Activities:
Contributions from general partner 108,200 31,500
Distributions to limited partners (1,150,000) (1,150,000)
----------- -----------
Net cash used in financing
activities (1,041,800) (1,118,500)
----------- -----------
Net Decrease in Cash and Cash Equivalents (12,725) (3,034)
Cash and Cash Equivalents at Beginning
of Period 319,052 425,600
----------- -----------
Cash and Cash Equivalents at End of
Period $ 306,327 $ 422,566
=========== ===========
Supplemental Schedule of Non-Cash
Financing Activities:
Distributions declared and unpaid
at end of period $ 575,000 $ 575,000
=========== ===========
See accompanying notes to condensed financial statements.
CNL INCOME FUND V, LTD.
(A Florida Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Six Months Ended June 30, 1996 and 1995
1. Basis of Presentation:
---------------------
The accompanying unaudited condensed financial statements have been
prepared in accordance with the instructions to Form 10-Q and do not
include all of the information and note disclosures required by
generally accepted accounting principles. The financial statements
reflect all adjustments, consisting of normal recurring adjustments,
which are, in the opinion of management, necessary to a fair statement
of the results for the interim periods presented. Operating results for
the quarter and six months ended June 30, 1996, may not be indicative of
the results that may be expected for the year ending December 31, 1996.
Amounts as of December 31, 1995, included in the financial statements,
have been derived from audited financial statements as of that date.
These unaudited financial statements should be read in conjunction with
the financial statements and notes thereto included in Form 10-K of CNL
Income Fund V, Ltd. (the "Partnership") for the year ended December 31,
1995.
The Partnership accounts for its 66.5% interest in CNL/Longacre Joint
Venture using the consolidation method. Minority interest represents
the minority joint venture partner's proportionate share of the equity
in the Partnership's consolidated joint venture. All significant
intercompany accounts and transactions have been eliminated.
Effective January 1, 1996, the Partnership adopted Statement of
Financial Accounting Standards No. 121, "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of." The
Statement requires that an entity review long-lived assets and certain
identifiable intangibles, to be held and used, for impairment whenever
events or changes in circumstances indicate that the carrying amount of
the asset may not be recoverable. Adoption of this standard had no
material effect on the Partnership's financial position or results of
operations.
2. Subsequent Event:
----------------
In July 1996, the Partnership received $51,500 in capital contributions
from the corporate general partner in connection with the operations of
the Partnership.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
CNL Income Fund V, Ltd. (the "Partnership") is a Florida limited
partnership that was organized on August 17, 1988, to acquire for cash, either
directly or through joint venture arrangements, both newly constructed and
existing restaurant properties, as well as land upon which restaurants were to
be constructed, which are leased primarily to operators of national and
regional fast-food and family-style restaurant chains (collectively, the
"Properties"). The leases are generally triple-net leases, with the lessees
responsible for all repairs and maintenance, property taxes, insurance and
utilities. As of June 30, 1996, the Partnership owned 29 Properties,
including interests in three Properties owned by joint ventures in which the
Partnership is a co-venturer.
Liquidity and Capital Resources
- -------------------------------
The Partnership's primary source of capital for the six months ended
June 30, 1996 and 1995, was cash from operations (which includes cash received
from tenants, distributions from joint ventures, and interest and other income
received, less cash paid for expenses). Cash from operations was $1,025,805
and $1,115,466 for the six months ended June 30, 1996 and 1995, respectively.
The decrease in cash from operations for the six months ended June 30, 1996,
is primarily a result of changes in income and expenses as discussed in
"Results of Operations" below and changes in the Partnership's working
capital.
Other sources and uses of capital included the following during the six
months ended June 30, 1996 and 1995.
The general partners have the right, but not the obligation, to make
additional capital contributions if they deem it appropriate in connection
with the operations of the Partnership. During the six months ended June 30,
1996 and 1995, the Partnership received $108,200 and $31,500, respectively, in
capital contributions from the corporate general partner in connection with
the operations of the Partnership. In addition, in July 1996, the Partnership
received $51,500 in additional capital contributions from the corporate
general partner in connection with the operations of the Partnership.
Currently, rental income from the Partnership's Properties is invested
in money market accounts or other short-term, highly liquid investments
pending the Partnership's use of such funds to pay Partnership expenses or to
make distributions to the partners. At June 30, 1996, the Partnership had
$306,327 invested in such short-term investments as compared to $319,052 at
December 31, 1995. The funds remaining at June 30, 1996, will be used towards
the payment of distributions and other liabilities.
Total liabilities of the Partnership increased to $811,641 at June 30,
1996, from $763,987 at December 31, 1995, primarily as the result of an
increase in amounts due to related parties during the six months ended June
30, 1996, and the Partnership's continuing to accrue real estate taxes for
its Properties located in Belding and South Haven, Michigan, and Lebanon, New
Hampshire. Liabilities at June 30, 1996, to the extent they exceed cash and
cash equivalents at June 30, 1996, will be paid from future cash from
operations, from general partner capital contributions of $51,500 received in
July 1996, and, in the event the general partners elect to make additional
capital contributions, from future general partner capital contributions.
Based on current and anticipated future cash from operations, and to a
lesser extent, additional capital contributions from the general partners
described above, the Partnership declared distributions to limited partners of
$1,150,000 for each of the six months ended June 30, 1996 and 1995 ($575,000
for each of the quarters ended June 30, 1996 and 1995). This represents
distributions for each applicable six months of $23.00 per unit ($11.50 per
unit for each applicable quarter). No distributions were made to the general
partners for the quarters and six months ended June 30, 1996 and 1995. No
amounts distributed or to be distributed to the limited partners for the six
months ended June 30, 1996 and 1995, are required to be or have been treated
by the Partnership as a return of capital for purposes of calculating the
limited partners' return on their adjusted capital contributions. The
Partnership intends to continue to make distributions of cash available for
distribution to the limited partners on a quarterly basis.
The Partnership's investment strategy of acquiring Properties for cash
and leasing them under triple-net leases to operators who generally meet
specified financial standards minimizes the Partnership's operating expenses.
The general partners believe that the leases will continue to generate cash
flow in excess of operating expenses.
Results of Operations
- ---------------------
During the six months ended June 30, 1995, the Partnership and its
consolidated joint venture, CNL/Longacre Joint Venture, owned and leased 28
wholly owned Properties (including one Property in Myrtle Beach, South
Carolina, which was sold in August 1995), and during the six months ended June
30, 1996, the Partnership and CNL/Longacre Joint Venture owned and leased 27
wholly owned Properties to operators of fast-food and family-style restaurant
chains. In connection therewith, during the six months ended June 30, 1996
and 1995, the Partnership and CNL/Longacre Joint Venture earned $992,399 and
$1,061,094, respectively, in rental income from operating leases and earned
income from direct financing leases, $496,127 and $517,716 of which was earned
during the quarters ended June 30, 1996 and 1995, respectively. Rental
income decreased approximately $30,800 and $61,700 during the quarter and six
months ended June 30, 1996, respectively, as a result of the sale of the
Property in Myrtle Beach, South Carolina, in August 1995.
As of June 30, 1996, the Partnership was continuing to seek replacement
tenants for its Properties, for which the Partnership was not receiving rental
income, in Belding and South Haven, Michigan, and Lebanon, New Hampshire.
Rental and earned income for 1996 and subsequent years are expected to remain
at reduced amounts until such time as the Partnership executes new leases for
these Properties.
For the six months ended June 30, 1996 and 1995, the Partnership also
earned $40,287 and $24,121, respectively, in contingent rental income, $2,585
and $15,186 of which was earned during the quarters ended June 30, 1996 and
1995, respectively. The increase in contingent rental income during the six
months ended June 30, 1996, as compared to the six months ended June 30, 1995,
is primarily attributable to (i) the Partnership adjusting estimated
contingent rental amounts accrued at December 31, 1995, to actual amounts as
of the six months ended June 30, 1996, and (ii) increased gross sales of
certain restaurant Properties requiring the payment of contingent rental
income. The decrease for the quarter ended June 30, 1996, as compared to the
quarter ended June 30, 1995, was partially attributable to the Partnership
establishing an allowance for doubtful accounts of approximately $8,800 for
contingent rental amounts during the quarter ended June 30, 1996, relating to
the Property in St. Cloud, Florida. The Partnership is continuing to pursue
the collection of such amounts and will recognize such amounts as income if
collected.
In addition, for the six months ended June 30, 1996 and 1995, the
Partnership also owned and leased two Properties indirectly through other
joint venture arrangements. In connection therewith, the Partnership earned
$22,233 and $22,557, respectively, attributable to net income earned by
unconsolidated joint ventures in which the Partnership is a co-venturer,
$11,288 and $11,417 of which was earned during the quarters ended June 30,
1996 and 1995, respectively.
Interest and other income was $68,357 and $25,594 for the six months
ended June 30, 1996 and 1995, respectively, of which $32,907 and $21,295 was
earned for the quarters ended June 30, 1996 and 1995, respectively. The
increase in interest and other income is primarily attributable to the
interest earned on the mortgage note receivable accepted in connection with
the sale of the Property in Myrtle Beach, South Carolina, in August 1995.
Operating expenses, including depreciation expense, were $333,916 and
$316,837 for the six months ended June 30, 1996 and 1995, respectively, of
which $152,750 and $159,048 were incurred for the quarters ended June 30, 1996
and 1995, respectively. The increase in operating expenses during the six
months ended June 30, 1996, as compared to the six months ended June 30, 1995,
is partially attributable to an increase in accounting and administrative
expenses associated with operating the Partnership and its Properties and
insurance expense as a result of the general partners obtaining contingent
liability and property coverage for the Partnership, effective May 1995. This
insurance policy is intended to reduce the Partnership's exposure in the
unlikely event a tenant's insurance policy lapses or is insufficient to cover
a claim relating to the Property.
The increase in operating expenses for the six months ended June 30,
1996, as compared to the six months ended June 30, 1995, was partially offset
by a decrease in depreciation expense of approximately $13,000 due to the sale
of the Partnership's Property in Myrtle Beach, South Carolina, in August 1995.
Due to the tenants defaulting under the terms of their lease agreements,
the Partnership expects to continue to incur real estate tax, insurance and
maintenance expense for its Properties in Belding and South Haven, Michigan,
and the Property in Lebanon, New Hampshire, until such time as a new lease is
executed for each Property.
As a result of the sale of the Property in Myrtle Beach, South Carolina,
in August 1995, and recording the gain using the installment method, the
Partnership recognized a gain for financial reporting purposes of $228 and
$450 during the quarter and six months ended June 30, 1996, respectively. No
properties were sold during the six months ended June 30, 1996 and 1995.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings. Inapplicable.
-----------------
Item 2. Changes in Securities. Inapplicable.
---------------------
Item 3. Defaults upon Senior Securities. Inapplicable.
-------------------------------
Item 4. Submission of Matters to a Vote of Security Holders.
---------------------------------------------------
Inapplicable.
Item 5. Other Information. Inapplicable.
-----------------
Item 6. Exhibits and Reports on Form 8-K.
--------------------------------
(a) Exhibits - None.
(b) No reports on Form 8-K were filed during the quarter ended
June 30, 1996.
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
DATED this 9th day of August, 1996.
CNL INCOME FUND V, LTD.
By: CNL REALTY CORPORATION
General Partner
By: /s/ James M. Seneff, Jr.
-------------------------
JAMES M. SENEFF, JR.
Chief Executive Officer
(Principal Executive Officer)
By: /s/ Robert A. Bourne
-------------------------
ROBERT A. BOURNE
President and Treasurer
(Principal Financial and
Accounting Officer)
