<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the balance
sheet of CNL Income Fund V, Ltd. at March 31, 1996, and its statement of income
for the three months then ended and is qualified in its entirety by reference to
the Form 10-Q of CNL Income Fund V, Ltd. for the three months ended March 31,
1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 407,793
<SECURITIES> 0
<RECEIVABLES> 60,378
<ALLOWANCES> 1,547
<INVENTORY> 0
<CURRENT-ASSETS> 471,930
<PP&E> 18,769,088
<DEPRECIATION> 2,223,674
<TOTAL-ASSETS> 20,729,803
<CURRENT-LIABILITIES> 809,183
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 19,626,031
<TOTAL-LIABILITY-AND-EQUITY> 20,729,803
<SALES> 0
<TOTAL-REVENUES> 569,424
<CGS> 0
<TOTAL-COSTS> 181,166
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 406,271
<INCOME-TAX> 0
<INCOME-CONTINUING> 406,271
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 406,271
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</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 March 31, 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
March 31, December 31,
ASSETS 1996 1995
----------- ------------
Land and buildings on operating
leases, less accumulated
depreciation of $2,223,674
and $2,128,453 $16,545,414 $16,640,635
Net investment in direct financing
leases 1,976,415 1,987,793
Investment in joint ventures 470,931 473,138
Mortgage note receivable, less
deferred gain of $141,419
and $141,641 894,330 895,736
Cash and cash equivalents 407,793 319,052
Receivables, less allowance for
doubtful accounts of $1,547
and $4,490 58,831 68,204
Prepaid expenses 5,306 11,921
Accrued rental income 316,437 309,357
Other assets 54,346 54,346
----------- -----------
$20,729,803 $20,760,182
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 19,436 $ 13,963
Accrued real estate taxes payable 96,021 84,135
Distributions payable 575,000 575,000
Due to related parties 87,824 61,519
Rents paid in advance 30,902 29,370
----------- -----------
Total liabilities 809,183 763,987
Minority interest 294,589 301,435
Partners' capital 19,626,031 19,694,760
----------- -----------
$20,729,803 $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
March 31,
1996 1995
-------- --------
Revenues:
Rental income from operating leases $449,665 $495,757
Earned income from direct financing
leases 46,607 47,621
Contingent rental income 37,702 8,935
Interest and other income 35,450 4,299
-------- --------
569,424 556,612
-------- --------
Expenses:
General operating and administrative 51,763 24,046
Professional services 7,937 3,901
Real estate taxes 13,904 12,315
State and other taxes 12,341 15,816
Depreciation 95,221 101,711
-------- --------
181,166 157,789
-------- --------
Income Before Minority Interest in Loss
of Consolidated Joint Venture, Equity
in Earnings of Unconsolidated Joint
Ventures and Gain on Sale of Land and
Building 388,258 398,823
Minority Interest in Loss of Consolidated
Joint Venture 6,846 2,902
Equity in Earnings of Unconsolidated Joint
Ventures 10,945 11,140
Gain on Sale of Land and Building 222 -
-------- --------
Net Income $406,271 $412,865
======== ========
Allocation of Net Income:
General partners $ 4,063 $ 4,129
Limited partners 402,208 408,736
-------- --------
$406,271 $412,865
======== ========
Net Income Per Limited Partner Unit $ 8.04 $ 8.17
======== ========
Weighted Average Number of Limited
Partner Units Outstanding 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
Quarter Ended Year Ended
March 31, December 31,
1996 1995
------------- ------------
General partners:
Beginning balance $ 203,960 $ 155,706
Contributions 100,000 31,500
Net income 4,063 16,754
----------- -----------
308,023 203,960
----------- -----------
Limited partners:
Beginning balance 19,490,800 20,127,734
Net income 402,208 1,663,066
Distributions ($11.50 and
$46.00 per limited partner
unit, respectively) (575,000) (2,300,000)
----------- -----------
19,318,008 19,490,800
----------- -----------
Total partners' capital $19,626,031 $19,694,760
=========== ===========
See accompanying notes to condensed financial statements.
CNL INCOME FUND V, LTD.
(A Florida Limited Partnership)
CONDENSED STATEMENTS OF CASH FLOWS
Quarter Ended
March 31,
1996 1995
--------- ---------
Increase (Decrease) in Cash and Cash
Equivalents:
Net Cash Provided by Operating
Activities $ 562,127 $ 550,548
--------- ---------
Cash Flows from Investing Activities:
Collections on mortgage note
receivable 1,614 -
--------- ---------
Net cash provided by investing
activities 1,614 -
--------- ---------
Cash Flows from Financing Activities:
Contributions from general partner 100,000 -
Distributions to limited partners (575,000) (575,000)
--------- ---------
Net cash used in financing
activities (475,000) (575,000)
--------- ---------
Net Increase (Decrease) in Cash and Cash
Equivalents 88,741 (24,452)
Cash and Cash Equivalents at Beginning
of Quarter 319,052 425,600
--------- ---------
Cash and Cash Equivalents at End of
Quarter $ 407,793 $ 401,148
========= =========
Supplemental Schedule of Non-Cash
Financing Activities:
Distributions declared and unpaid
at end of quarter $ 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 Ended March 31, 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 ended March 31, 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 April 1996, the Partnership received $8,200 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 March 31, 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 quarters ended March
31, 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 $562,127 and
$550,548 for the quarters ended March 31, 1996 and 1995, respectively. The
increase in cash from operations for the quarter ended March 31, 1996, is
primarily a result of changes in the Partnership's working capital.
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 quarter ended March 31,
1996, the Partnership received $100,000 in capital contributions from the
corporate general partner in connection with the operations of the
Partnership. No such contributions were received during the quarter ended
March 31, 1995. In addition, in April 1996, the Partnership received $8,200
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 March 31, 1996, the Partnership had
$407,793 invested in such short-term investments as compared to $319,052 at
December 31, 1995. The funds remaining at March 31, 1996, will be used
towards the payment of distributions and other liabilities.
Total liabilities of the Partnership increased to $809,183 at March 31,
1996, from $763,987 at December 31, 1995, primarily as the result of an
increase in amounts due to related parties during the quarter ended March 31,
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 March 31, 1996, to the extent they exceed cash and
cash equivalents at March 31, 1996, will be paid from future cash from
operations, from general partner capital contributions of $8,200 received in
April 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 $575,000 for each of the quarters ended March 31, 1996 and 1995. This
represents distributions for each applicable quarter of $11.50 per unit. No
distributions were made to the general partners for the quarters ended
March 31, 1996 and 1995. No amounts distributed or to be distributed to the
limited partners for the quarter ended March 31, 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 quarter ended March 31, 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 quarter ended March
31, 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 quarters ended March 31, 1996 and
1995, the Partnership and CNL/Longacre Joint Venture earned $496,272 and
$543,378, respectively, in rental income from operating leases and earned
income from direct financing leases. Rental income decreased approximately
$30,800 during the quarter ended March 31, 1996, as compared to the quarter
ended March 31, 1995, as a result of the sale of the Property in Myrtle Beach,
South Carolina, in August 1995.
In addition, rental and earned income for the quarter ended March 31,
1996, as compared to the quarter ended March 31, 1995, decreased approximately
$8,000 due to the fact that the tenant of the Partnership's consolidated joint
venture, CNL/Longacre Joint Venture, defaulted under the terms of the lease
and in February 1995 ceased operations of the restaurant on the Property
located in Lebanon, New Hampshire. The Partnership currently is not receiving
any rental income relating to this Property and is seeking a replacement
tenant.
The decrease in rental and earned income during the quarter ended
March 31, 1996, as compared to the quarter ended March 31, 1995, is also
partially attributable to the fact that the operator of the Property located
in South Haven, Michigan, ceased operations and the restaurant closed in
October 1995. The Partnership currently is not receiving any rental income
relating to this Property, as compared to approximately $7,500 for the quarter
ended March 31, 1995. The Partnership is currently seeking a replacement
tenant for this Property.
Rental and earned income for 1996 are expected to remain at reduced
amounts until such time as the Partnership executes new leases for its
Properties in Belding and South Haven, Michigan, and Lebanon, New Hampshire.
For the quarters ended March 31, 1996 and 1995, the Partnership also
earned $37,702 and $8,935, respectively, in contingent rental income. The
increase in contingent rental income during the quarter ended March 31, 1996,
as compared to the quarter ended March 31, 1995, is primarily attributable to
(i) the Partnership adjusting estimated contingent rental amounts accrued at
December 31, 1995, to actual amounts as of the quarter ended March 31, 1996,
and (ii) increased gross sales of certain restaurant Properties requiring the
payment of contingent rental income.
In addition, for the quarters ended March 31, 1996 and 1995, the
Partnership also owned and leased two Properties indirectly through other
joint venture arrangements. In connection therewith, the Partnership earned
$10,945 and $11,140, respectively, attributable to net income earned by
unconsolidated joint ventures in which the Partnership is a co-venturer.
Interest and other income was $35,450 and $4,299 for the quarters ended
March 31, 1996 and 1995, respectively. The increase in interest and other
income during the quarter ended March 31, 1996, as compared to the quarter
ended March 31, 1995, 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 $181,166 and
$157,789 for the quarters ended March 31, 1996 and 1995, respectively. The
increase in operating expenses during the quarter ended March 31, 1996, as
compared to the quarter ended March 31, 1995, is partially attributable to an
increase in (i) accounting and administrative expenses associated with
operating the Partnership and its Properties and (ii) 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. Operating expenses also increased due to the fact that during the
quarter ended March 31, 1996, the Partnership incurred professional services
as a result of appraisal updates obtained to prepare an annual statement of
unit valuation to qualified plans in accordance with the Partnership's
partnership agreement. During 1995, these professional services were incurred
during the quarter ended June 30, 1995.
Operating expenses also increased during the quarter ended March 31,
1996, as compared to the quarter ended March 31, 1995, by approximately
$11,600 due to the Partnership and CNL/Longacre Joint Venture incurring real
estate tax, insurance and maintenance expense for its Properties in Belding
and South Haven, Michigan, and the Property in Lebanon, New Hampshire, due to
the tenants defaulting under the terms of their lease agreements. The
Partnership and CNL/Longacre Joint Venture expect to continue to incur such
expenses relating to such Properties until such time as a new lease is
executed for each Property.
The increase in operating expenses for the quarter ended March 31, 1996,
as compared to the quarter ended March 31, 1995, was partially offset by a
decrease in depreciation expense of approximately $6,500 due to the sale of
the Partnership's Property in Myrtle Beach, South Carolina, in August 1995.
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 $222 during
the quarter ended March 31, 1996. No properties were sold during the quarters
ended March 31, 1996 or 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
March 31, 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 10th day of May, 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)
