UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESx
EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995
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 0-18498
Krupp Cash Plus-V Limited Partnership
(Exact name of registrant as specified in its charter)
Massachusetts 04-3021560
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
470 Atlantic Avenue, Boston, Massachusetts 02210
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (617) 423-2233
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Depositary Receipts representing Units of Limited Partner 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 such 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. [ ].
Aggregate market value of voting securities held by non-affiliates: Not
applicable, since securities are nonvoting.
Documents incorporated by reference: See Part IV, Item 14b on pages 9-10
of this report.
The exhibit index is located on pages 9-10.
<PAGE>
PART I
ITEM 1. BUSINESS
Krupp Cash Plus-V Limited Partnership (the "Partnership") was formed on
August 22, 1988 by filing a Certificate of Limited Partnership in The
Commonwealth of Massachusetts. Krupp Plus Corporation and Krupp Company
Limited Partnership-VI were the original General Partners of the
Partnership. On March 15, 1995, Krupp Plus Corporation withdrew as
General Partner from the Partnership and assigned its rights, title and
interest in the Partnership to Krupp Company Limited Partnership-VI.
Krupp Depositary Corporation is the Corporate Limited Partner. For
details see Note A to Financial Statements included in Appendix A of this
report.
On March 3, 1989 the Partnership commenced the marketing and sale of
Depositary Receipts ("Units") and raised $41,203,189 from this public
offering. The Partnership invested the net proceeds from the offering in
Spring Valley Partnership ("Joint Venture") and mortgage-backed securities
("MBS") issued or originated by the Federal Home Loan Mortgage Corporation
("FHLMC"). The Partnership considers itself to be engaged only in the
industry segment of investment in real estate and related assets.
The Partnership's retail real estate investment is subject to seasonal
fluctuations, as net income may vary somewhat from quarter to quarter
based upon changes in utility consumption, seasonal maintenance
expenditures and changes in rental income which are based upon a
percentage of gross receipts of retail tenants. However, the future
performance of the Partnership will depend upon factors which cannot be
predicted. Such factors include general economic and real estate market
conditions, both on a national basis and in the area where the
Partnership's real estate investment is located, real estate tax rates,
operating expenses, energy costs, government regulations and federal and
state income tax laws. The requirements for compliance with federal,
state and local regulations have not had an adverse effect on the
Partnership's operations to date, and no adverse effect therefrom is
anticipated in the future.
The Partnership's investment in retail real estate is also subject to
such risks as (i) competition from existing and future projects held by
other owners in the locations of the Partnership's properties, (ii)
possible reduction in rental income due to an inability to maintain high
occupancy levels, the financial failure of a tenant or the inability of
retail tenants to achieve gross sales at a level sufficient to provide for
additional rental income based on a percentage of sales, (iii) possible
adverse changes in general economic and local conditions, such as
competitive over-building, increases in unemployment, or adverse changes
in real estate zoning laws, and (iv) other circumstances over which the
Partnership may have little or no control.
As of December 31, 1995, there were two people employed on-site by the
Joint Venture.
ITEM 2. PROPERTY
As of December 31, 1995, the Partnership has an unleveraged joint
venture investment in a shopping center with 314,673 square feet of
leasable space. Additional detailed information with respect the property
is contained in Note D to the Financial Statements as well as the Separate
Financial
<PAGE>
Statements and Schedule III for Spring Valley Partnership which are
included in Item 8 (Appendix A) to this report.
A summary of the Partnership's real estate investments is presented
below.
<TABLE>
<CAPTION>
Average Occupancy
Current Leasable Year Ended
Year of Square Footage/ December 31,
Description Acquisition Units 1995 1994 1993 1992 1991
Spring Valley
<S> <C> <C> <C> <C> <C> <C> <C>
Marketplace 1988 314,673 98% 96% 95% 95% 95%
</TABLE>
There are no present plans for major improvements or developments of the
unleveraged real estate. Only improvements necessary to keep the property
competitive in its respective market were completed in 1995 and are
expected to continue in the next year.
ITEM 3. LEGAL PROCEEDINGS
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
Part II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
There currently is no established trading market for the Units.
The number of investors holding Units as of December 31, 1995 is
approximately 2,865.
The Partnership made the following distributions, in quarterly
installments, during the two years ended December 31, 1995 and 1994:
<TABLE>
<CAPTION>
1995 1994
Average Average
Amount Per Unit Amount Per Unit
Limited Partners:
<S> <C> <C> <C> <C>
Unitholders $2,060,350 $1.00 $2,064,585 $1.00
Corporate Limited Partner 100 $1.00 100 $1.00
General Partners 17,139 11,965
$2,077,589 $2,076,650
</TABLE>
One of the objectives of the Partnership is to generate cash available
for distribution. However, there is no assurance that future operations
will continue to generate cash available for distribution.
<PAGE>
ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth selected financial information regarding
the Partnership's financial position and operating results. This
information should be read in conjunction with Management's Discussion and
Analysis of Financial Condition and Results of Operations and the
Financial Statements and Supplementary Data, which are included in Items 7
and 8 (Appendix A) of this report, respectively.
<TABLE>
<CAPTION>
Year ended December 31,
1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Revenues $ 1,130,856 $ 896,048 $ 935,592 $ 1,017,946 $ 1,217,652
Net income 887,535 603,140 571,567 699,062 895,263
Net income allocated
to Partners:
Unitholders 878,617 597,080 565,824 692,037 886,267
(Avg. per Unit) (.43) (.29) (.27) (.34) (.43)
Corporate Limited
Partner 43 29 27 34 43
General Partners 8,875 6,031 5,716 6,991 8,953
Total assets at
December 31, 26,240,244 27,437,104 28,896,948 30,400,262 32,402,086
Distributions to Partners:
Unitholders 2,060,350 2,064,585 2,058,935 2,680,726 3,263,020
(Avg. Per Unit) (1.00)(a) (1.00)(a) (1.00)(a) (1.30)(a) (1.58)(a)
Corporate Limited
Partner 100 100 100 130 159
General Partners 17,139 11,965 12,999 14,366 20,132
(a) For the periods ended 1995, 1994, 1993, 1992 and 1991 the Limited
Partners' Average per Unit return of capital was $.30, $.28, $.39,
$.00 and $.38, respectively.
The Partnership completed its public offering during the first quarter of
1991, therefore, the selected financial data for 1995, 1994, 1993 and 1992
is not comparable to prior periods. In addition, the selected financial
data for 1995, 1994, 1993 and 1992 is not necessarily indicative of the
Partnership's future operations.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Partnership's sources of liquidity are derived from the distributions
it receives from its investment in the Joint Venture (Spring Valley
Marketplace) and the interest and principal collections on its MBS and
other investments.
Over the last two years, Spring Valley Marketplace has been a strong
contributor to the Partnership's liquidity after experiencing some retail
<PAGE>
difficulties in 1992 and 1993. Revenues at the Marketplace have steadily
increased since 1992 as strong national tenants have positively impacted
the shopping center. As a result, management expects operations at the
shopping center to exhibit stabilized growth for the near future.
Liquidity provided by the MBS during the current year has come primarily
from interest income as principal prepayments have decreased significantly
from the principal amounts received in 1994 and 1993. During 1994 and
1993, prepayments were significant due to the low interest rate
environment. The liquidity provided by the principal prepayments has been
used to fund distributions, which has resulted in a reduction of the
Partnership's capital resources.
The Partnership holds MBS that are guaranteed by the Federal Home Mortgage
Corporation ("FHLMC"). The principal risks with respect to MBS are the
credit worthiness of FHLMC, and the risk that the current value of any MBS
may decline as a result of changes in market interest rates. The General
Partners believe that this risk is minimal due to the fact that the
Partnership has the ability to hold these securities to maturity.
The most significant demands on the Partnership's liquidity are the
quarterly distributions. Distributions are funded by MBS principal
prepayments, distributions received from the Joint Venture and working
capital reserves. Due to the decrease in MBS principal prepayments and
its effect on the Partnership's liquidity, the Partnership may need to
periodically adjust the distribution rate. Therefore, sustaining the
distribution rate is mainly dependent upon the future performance of the
Joint Venture.
Distributable Cash Flow and Net Cash Proceeds from Capital Transactions
The General Partners provide certain of the information below to meet
requirements of the Partnership Agreement and because they believe that it
is an appropriate supplemental measure of operating performance. However,
Distributable Cash Flow and Net Cash Proceeds From Capital Transactions
should not be considered by the reader as a substitute to net income, as
an indicator of the Partnership's operating performance or to cash flows
as a measure of liquidity.
Shown below is the calculation of Distributable Cash Flow and Net Cash
Proceeds from Capital Transactions as defined by Section 17 of the
Partnership Agreement for the year ended December 31, 1995 and for the
period from inception to December 31, 1995:
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
(Rounded to $1,000 except per Unit amounts)
For the Year Inception to
Ended December 31, December 31,
1995 1995
Distributable Cash Flow:
<S> <C> <C>
Net income for tax purposes $ 1,143 $ 6,391
Items not requiring, providing or
(not providing) the use of
operating funds:
Amortization of organization costs - 50
Distributions from S.V. Partnership 1,468 9,466
Partnership's share of S.V.
Partnership taxable net income (1,163) (6,227)
Total Distributable Cash Flow ("DCF") $ 1,448 $ 9,680
Limited Partners' Share of DCF $ 1,434 $ 9,584
Limited Partners' Share of DCF
per Unit $ .70 $ 4.66
General Partners' Share of DCF $ 14 $ 96
Net Proceeds from Capital Transactions:
Principal collections on MBS, net $ 69 $ 4,453
Distributions:
Limited Partners $ 2,061(a) $15,496(b)
Limited Partners' Average per Unit $ 1.00(a) $ 7.52(b)(c)
General Partners $ 17(a) $ 99(b)
Total Distributions 2,078(a) 15,595(b)
</TABLE>
(a) Represents all distributions paid in 1995 except the February 1995
distribution, and includes an estimate of the distribution to be
paid in February 1996.
(b) Includes estimate of the distribution to be paid in February 1996.
(c) Limited Partners Average per Unit return of capital as of February
1996 is $2.86 ($7.52 - $4.66)
Operations
1995 compared to 1994
Overall, distributable cash flow, as defined in the Partnership Agreement,
decreased from 1994 to 1995 primarily due to the decrease in distributions
received from the Joint Venture.
The Partnership's revenues have increased from 1994 to 1995 because of the
increased net income generated by the Marketplace. MBS interest income
decreased in 1995 when compared to 1994 due to the overall reduction in
MBS principal. This decrease was offset by an increase in interest
received from the Partnership's other short-term investments.
<PAGE>
The Marketplace experienced a significant increase in net income from 1994
to 1995. The increase in the Marketplace rental revenues from 1994 to
1995 is primarily due to an increase in reimbursable tenant billings
derived from increases in real estate taxes. Also, base rent increased
slightly due to the increase in rental rates and the stable occupancy
maintained at the property throughout the year. Interest income increased
due to the Marketplace's increased investment in commercial paper.
In comparing 1995 to 1994, operating expenses at the Marketplace decreased
significantly, primarily due to management's efforts to reduce general and
administrative expenses. These savings were partially offset by increases
in maintenance expenses primarily from the resurfacing of the parking lot,
and depreciation expense, due to tenant improvements during 1995 and 1994.
1994 compared to 1993
The Partnership realized an increase in net income from 1993 to 1994 which
can be attributed to a decrease in expenses of the Partnership.
The Partnership's share of Joint Venture net income increased from 1993 to
1994. However, the Partnership realized a decrease in MBS interest income
which was somewhat offset by an increase in interest received on other
short-term investments. The decrease in MBS interest income is due to the
high amount of principal prepayments received throughout 1993 and the
first half of 1994.
Expenses decreased for the Partnership from 1993 to 1994. This decrease
is largely attributable to a one-time adjustment for an underaccrual of
asset management fees that occurred in the first quarter of 1993.
The Marketplace's increase in net income from 1993 to 1994 can be
attributed to management's success in attracting strong national tenants
as well as an increase in occupancy over 1993. The property also received
a tax refund for prior years due to a reassessment of the property tax
base by the taxing authorities. However, the decrease in taxes was
somewhat offset by an increase in depreciation due to the tenant
improvements which took place in 1993.
General
In accordance with Financial Accounting Standards No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of", which is effective for fiscal years beginning after December
15, 1995, the Partnership has implemented policies and practices for
assessing impairment of its real estate assets.
In assessing the impairment of the underlying real estate owned by the
Joint Venture, the General Partners routinely perform market and growth
studies combined with periodic appraisals of the underlying property. If
the General Partners believe that there is impairment in value, a
provision to write down the investment to fair value will be charged
against income. At this time, the General Partners do not believe that
any asset of the Partnership is significantly impaired.
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See Appendix A to this report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Partnership has no directors or executive officers. Information as to
the directors and executive officers of Krupp Company Limited Partnership-
VI, which is the General Partner of the Partnership, and Krupp Plus-II
Corporation, which is the General Partner of Krupp Company Limited
Partnership-VI, is as follows:
Position with
Name and Age Krupp Plus-II Corporation
Douglas Krupp (49) Co-Chairman of the Board
George Krupp (51) Co-Chairman of the Board
Laurence Gerber (39) President
Robert A. Barrows (38) Treasurer
Douglas Krupp is Co-Chairman and Co-Founder of The Berkshire Group.
Established in 1969 as the Krupp Companies, this real estate-based firm
expanded over the years within its areas of expertise including investment
program sponsorship, property and asset management, mortgage banking,
healthcare facility ownership and the management of the Company. Today,
The Berkshire Group is an integrated real estate, mortgage and healthcare
company which is headquartered in Boston with regional offices throughout
the country. A staff of approximately 3,400 are responsible for the more
than $4 billion under management for institutional and individual clients.
Mr. Krupp is a graduate of Bryant College. In 1989 he received an
honorary Doctor of Science in Business Administration from this
institution and was elected trustee in 1990. Mr. Krupp is Chairman of the
Board and a Director of Berkshire Realty Company, Inc. (NYSE-BRI). George
Krupp is Douglas Krupp's brother.
George Krupp is the Co-Chairman and Co-Founder of The Berkshire Group.
Established in 1969 as the Krupp Companies, this real estate-based firm
expanded over the years within its areas of expertise including investment
program sponsorship, property and asset management, mortgage banking and
healthcare facility ownership. Today, The Berkshire Group is an
integrated real estate, mortgage and healthcare company which is
headquartered in Boston with regional offices throughout the country. A
staff of approximately 3,400 are responsible for more than $4 billion
under management for institutional and individual clients. Mr. Krupp
attended the University of Pennsylvania and Harvard University. Mr. Krupp
also serves as Chairman of the Board and Trustee of Krupp Government
Income Trust and as Chairman of the Board and Trustee of Krupp Government
Income Trust II.
<PAGE>
Laurence Gerber is the President and Chief Executive Officer of The
Berkshire Group. Prior to becoming President and Chief Executive Officer
in 1991, Mr. Gerber held various positions with The Berkshire Group which
included overall responsibility at various times for: strategic planning
and product development, real estate acquisitions, corporate finance,
mortgage banking, syndication and marketing. Before joining The Berkshire
Group in 1984, he was a management consultant with Bain & Company, a
national consulting firm headquartered in Boston. Prior to that, he was a
senior tax accountant with Arthur Andersen & Co., an international
accounting and consulting firm. Mr. Gerber has a B.S. degree in Economics
from the University of Pennsylvania, Wharton School and an M.B.A. degree
with high distinction from Harvard Business School. He is a Certified
Public Accountant. Mr. Gerber also serves as President and Director of
Berkshire Realty Company, Inc. (NYSE-BRI) and President and Trustee of
Krupp Government Income Trust and President and Trustee of Krupp
Government Income Trust II.
Robert A. Barrows is Senior Vice President and Chief Financial Officer
of Berkshire Mortgage Finance and Corporate Controller of The Berkshire
Group. Mr. Barrows has held several positions within The Berkshire Group
since joining the company in 1983 and is currently responsible for
accounting and financial reporting, treasury, tax, payroll and office
administrative activities. Prior to joining The Berkshire Group, he was
an audit supervisor for Coopers & Lybrand L.L.P. in Boston. He received
a B.S. degree from Boston College and is a Certified Public Accountant.
ITEM 11. EXECUTIVE COMPENSATION
The Partnership does not have any directors or executive officers.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of December 31, 1995 no person of record owned or was known by the
General Partners to own beneficially more than 5% of the Partnership's
outstanding Units.
The only interests held by management or its affiliates consist of its
General Partner and Corporate Limited Partner Interests.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Partnership does not have any directors, executive offices or nominees
for election as director. Additionally, as of December 31, 1995 no person
of record owned or was known by the General Partners to own beneficially
more than 5% of the Partnership s outstanding Units.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) 1. Financial Statements - see Index to Financial Statements
included under Item 8, Appendix A, on page F-2 of this
report.
2. Financial Statement Schedules - all schedules are omitted
<PAGE>
as they are not applicable, not required or the
information is provided in the Financial Statements or
the Notes thereto.
3. Separate Financial Statements - as required by Rule 3-09
of Regulation S-X the financial statements and schedule
for Spring Valley Marketplace (Joint Venture) are
included under Item 8, Appendix A on pages F-13 through
F-24.
(b)Exhibits:
Number and Description
Under Regulation S-K
The following reflects all applicable Exhibits required under
Item 601 of Regulation S-K:
(4) Instruments defining the rights of security holders
including indentures:
(4.1) Agreement of Limited Partnership dated as of
February 23, 1989 [Exhibit A to Prospectus
included in Amendment No. 2 of Registrant's
Registration Statement on Form S-11 dated March
1, 1989 (File No. 33-24181)].*
(4.2) Subscription Agreement Specimen [Exhibit D to
Prospectus included in Amendment No. 2 of
Registrant's Registration Statement on Form S-11
dated March 1, 1989 (File No. 33-24181)].*
(4.3) First Amendment to and Restatement of Certificate
of Limited Partnership filed with the
Massachusetts Secretary of State on February 22,
1989 [Exhibit 4.4 to Prospectus included in
Amendment No. 2 of Registrant's Registration
Statement on Form S-11 dated March 1, 1989 (File
No. 33-24181)].*
(4.4) Krupp Sponsored IRA New Investor Application
[Exhibit 4.5 to Prospectus included in Amendment
No. 1 of Registrant's Registration Statement on
Form S-11 dated November 30, 1988] (File No. 33-
24181).*
(10) Material Contracts:
Spring Valley Marketplace
(10.1) Purchase and Sale Agreement dated November 14,
1988 between Krupp Realty Company Limited
Partnership, now known as Berkshire Realty
Enterprises L.P. ("BRE"), ("Buyer") and Valley
Associates, Ltd. ("Seller"). [Exhibit 10.1 to
Registrant's Report of Form 10-Q for the Quarter
Ended September 30, 1989 (File No. 33-24181)].*
<PAGE>
(10.2) Assignment of Agreement dated December 13, 1988
by and between Spring Valley Partnership
("Assignee") and BRE ("Assignor"). [Exhibit 10.2
to Registrant's Report on Form 10-Q for the
Quarter Ended September 30, 1989 (File No. 33-
24181)].*
(10.3) Spring Valley Partnership - Partnership Agreement
dated December 13, 1988 by and among Krupp Cash
Plus-V Limited Partnership and BRE [Exhibit 10.5
to Prospectus in Amendment No. 2 of Registrant's
Registration Statement on Form S-11 dated March
1, 1989 (File No. 33-24181)].*
(10.4) Bargain and Sale Deed dated December 13, 1988
between Spring Valley Partnership ("Grantee") and
BRE ("Grantor") [Exhibit 10.3 to Registrant's
Report on Form 10-Q for the Quarter Ended
September 30, 1989 (File No. 33-24181)].*
(10.5) Additional Sales Price Agreement dated December
13, 1988 between Krupp Cash Plus-V Limited
Partnership and BRE [Exhibit 10.6 to Prospectus
in Amendment No. 2 of Registrant's Registration
Statement on Form S-11 dated March 1, 1989 (File
No. 33-24181)].*
(10.6) Property Management Agreement dated December 16,
1988 between Spring Valley Partnership ("Owner")
and BRE ("Agent") [Exhibit 10.7 to Prospectus in
Amendment No. 2 of Registrant's Registration
Statement on Form S-11 dated March 1, 1989 (File
No. 33-24181)].*
* Incorporated by reference.
(c) Reports on Form 8-K
During the last quarter of the fiscal year ended December
31, 1995, the Partnership filed no reports on Form 8-K.
<PAGE>
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, on the 21st day of March, 1996.
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
By: Krupp Company Limited Partnership-VI, the
General Partner, by Krupp Plus-II
Corporation, the General Partner of Krupp
Company Limited Partnership-VI
By: /s/ Douglas Krupp
Douglas Krupp, Co-Chairman (Principal
Executive Officer) and Director of Krupp
Plus-II Corporation
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 indicated, on the 21st day of March,
1996.
Signatures Title(s)
/s/ Douglas Krupp Co-Chairman (Principal Executive Officer)
Douglas Krupp and Director of Krupp Plus-II Corporation,
the General Partner of Krupp Company
Limited Partnership-VI
/s/ George Krupp Co-Chairman (Principal Executive Officer)
George Krupp and Director of Krupp Plus-II Corporation,
the General Partner of Krupp Company
Limited Partnership-VI
/s/ Laurence Gerber President of Krupp Plus-II Corporation,
Laurence Gerber the General Partner of Krupp Company
Limited Partnership-VI
/s/Robert A. Barrows Treasurer of Krupp Plus-II Corporation,
Robert A. Barrows the General Partner of Krupp Company
Limited Partnership-VI
<PAGE>
APPENDIX A
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
FINANCIAL STATEMENTS
ITEM 8 of FORM 10-K
REPORT TO THE SECURITIES AND EXCHANGE COMMISSION
For the Year Ended December 31, 1995
<PAGE>
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
INDEX TO FINANCIAL STATEMENTS
Report of Independent Accountants F-3
Balance Sheets at December 31, 1995 and 1994 F-4
Statements of Income For the Years Ended December 31, 1995,
1994 and 1993 F-5
Statements of Changes in Partners' Equity for the Years Ended
December 31, 1995, 1994 and 1993 F-6
Statements of Cash Flows for the Years Ended December 31, 1995,
1994 and 1993 F-7
Notes to Financial Statements F-8 - F-12
Separate Financial Statements - Spring Valley Marketplace F-13 -
F-24
All schedules are omitted as they are not applicable or not required, or
the information is provided in the financial statements or the notes
thereto.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Partners of
Krupp Cash Plus-V Limited Partnership:
We have audited the financial statements of Krupp Cash Plus-V Limited
Partnership (the "Partnership") listed in the index on page F-2 of this
Form 10-K. These financial statements are the responsibility of the
Partnership's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards 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. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Krupp Cash Plus-V
Limited Partnership as of December 31, 1995 and 1994, and the results of
its operations and its cash flows for each of the three years in the
period ended December 31, 1995 in conformity with generally accepted
accounting principles.
Boston, Massachusetts COOPERS & LYBRAND L.L.P.
January 31, 1996
<PAGE>
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
BALANCE SHEETS
December 31, 1995 and 1994
ASSETS
<TABLE>
<CAPTION>
1995 1994
Real estate assets:
<S> <C> <C>
Investment in Joint Venture (Note D) $23,187,379 $23,748,539
Mortgage-backed securities ("MBS"),
net of amortization (Note C) 915,554 984,565
Total real estate assets 24,102,933 24,733,104
Cash and cash equivalents 2,101,121 2,665,531
Interest receivable and other assets 36,190 38,469
Total assets $26,240,244 $27,437,104
LIABILITIES AND EQUITY
Liabilities $ 9,729 $ 16,535
<PAGE>
Partners' equity (Note E):
Unitholders
(2,060,350 Units outstanding) 26,273,929 27,455,662
Corporate Limited Partner
(100 Units outstanding) (535) (478)
General Partners (42,879) (34,615)
Total Partners' equity 26,230,515 27,420,569
Total liabilities and Partners' equity $26,240,244 $27,437,104
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
STATEMENTS OF INCOME
For the Years Ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
1995 1994 1993
Revenue:
Partnership's share of Joint
<S> <C> <C> <C>
Venture (Note D) $ 906,900 $674,187 $ 646,761
Interest income - MBS (Note C) 86,939 122,957 219,446
Interest income - other 137,017 98,904 69,385
Total revenue 1,130,856 896,048 935,592
Expenses:
General and administrative
(including reimbursements to
affiliates of $53,519, $88,291
and $98,344, respectively)
(Note F) 99,239 143,932 161,199
Asset management fees to an
affiliate (Note F) 144,082 145,643 192,826
Amortization of organization
cost - 3,333 10,000
Total expenses 243,321 292,908 364,025
Net income (Notes E and G) $ 887,535 $603,140 $ 571,567
Allocation of net income (Note E):
Unitholders
(2,060,350 Units outstanding) $ 878,617 $597,080 $ 565,824
Net income per Unit of
Depositary Receipt $ .43 $ .29 $ .27
Corporate Limited Partner $ 43 $ 29 $ 27
General Partners $ 8,875 $ 6,031 $ 5,716
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
STATEMENTS OF CHANGES IN PARTNERS' EQUITY
For the Years Ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
Corporate Total
Limited General Partners'
Unitholders Partner Partners Equity
Balance at
<S> <C> <C> <C> <C>
December 31, 1992 $30,416,278 $(334) $(21,398) $30,394,546
Distributions (2,058,935) (100) (12,999) (2,072,034)
Net income 565,824 27 5,716 571,567
Balance at
December 31, 1993 28,923,167 (407) (28,681) 28,894,079
Distributions (2,064,585) (100) (11,965) (2,076,650)
Net income 597,080 29 6,031 603,140
Balance at
December 31, 1994 27,455,662 (478) (34,615) 27,420,569
Distributions (2,060,350) (100) (17,139) (2,077,589)
Net income 878,617 43 8,875 887,535
Balance at
December 31, 1995 $26,273,929 $(535) $(42,879) $26,230,515
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
1995
1994 1993
Operating activities:
<S> <C> <C> <C>
Net income $ 887,535 $ 603,140 $ 571,567
Adjustments to reconcile net
income to net cash provided by
operating activities:
Amortization of organization
costs - 3,333 10,000
Amortization of MBS discount (669) (13,194) (20,177)
Distributions from Joint
Venture 906,898 674,187 646,761
Partnership's share of Joint
Venture net income (906,898) (674,187) (646,761)
Decrease (increase) in interest
receivable and other
assets 2,279 (6,655) 19,123
Increase (decrease) in
total liabilities (6,806) 13,666 (2,847)
Net cash provided by
operating activities 882,339 600,290 577,666
Investing activity:
Distributions from Joint Venture
in excess of net income 561,160 903,153 685,569
Principal collections on MBS 69,680 778,941 1,313,917
Net cash provided by investing
activities 630,840 1,682,094 1,999,486
Financing activity:
Distributions (2,077,589) (2,076,650) (2,072,034)
Net (decrease) increase in cash
and cash equivalents (564,410) 205,734 505,118
Cash and cash equivalents,
beginning of year 2,665,531 2,459,797 1,954,679
Cash and cash equivalents,
end of year $ 2,101,121 $2,665,531 $2,459,797
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
KRUPP CASH PLUS-V LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
A. Organization
Krupp Cash Plus-V Limited Partnership (the "Partnership") was formed on
August 22, 1988 by filing a Certificate of Limited Partnership in The
Commonwealth of Massachusetts. The Partnership originally issued all
of the General Partner Interests to Krupp Plus Corporation and The
Krupp Company Limited Partnership-VI in exchange for capital
contributions aggregating $3,000. Except under certain limited
circumstances upon termination of the Partnership, the General Partners
are not required to make any additional capital contributions. On
March 15, 1995, Krupp Plus Corporation withdrew as General Partner from
the Partnership and assigned its rights, title and interest in the
Partnership to Krupp Company Limited Partnership-VI. The Partnership
will continue in existence until December 31, 2028, unless earlier
terminated upon the occurrence of certain events as set forth in the
Partnership Agreement.
The Partnership has issued all of the Corporate Limited Partner
Interests to Krupp Depositary Corporation (the "Corporate Limited
Partner") in exchange for a capital contribution of $2,000. The
Corporate Limited Partner, in turn, has issued Depositary Receipts (the
"Units") to the investors and has assigned all of its rights and
interest in the Limited Partner Interests (except for its $2,000
Limited Partner's interest) to the holders of the Units (the
"Unitholders"). As of March 1, 1991, the Partnership completed its
public offering having sold 2,060,350 Units for $41,203,189, net of
purchase volume discounts of $3,811.
B. Significant Accounting Policies
The Partnership uses the following accounting policies for financial
reporting purposes:
Risks and Uncertainties
The Partnership invests its cash primarily in deposits and money
market funds with commercial banks. The Partnership has not
experienced any losses to date on its invested cash.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amount of
revenues and expenses during the reporting period. Actual results
could differ from those estimates.
Cash Equivalents
The Partnership includes all short-term investments with maturities
of three months or less from the date of acquisition in cash and cash
equivalents. Cash equivalents are recorded at cost, which
approximates current market values.
<PAGE>
Deferred Costs
Costs incurred in connection with the acquisition of computer
software are being amortized over a five year period using the
straight-line method. Costs incurred in connection with the
organization of the Partnership were amortized over a five year
period using the straight-line method.
Investment in Joint Venture
The Partnership has a 49.9% interest in Spring Valley Partnership
("Joint Venture"). This investment was recorded at cost and is
accounted for by the equity method since the Partnership Agreement
requires a two-thirds majority for all major decisions regarding the
Joint Venture. As such, the Partnership does not have control of the
operations of the underlying assets. Under the equity method of
accounting, the Partnership's equity investment in the net income of
the Joint Venture is included currently in the Partnership's net
income. Cash distributions received from the Joint Venture reduce
the Partnership's investment (see Note D).
MBS
The Partnership carries its MBS at amortized cost as the Partnership
has both the intention and ability to hold its MBS until maturity.
Premiums or discounts are amortized over the life of the underlying
mortgages using the effective yield method. The market value of MBS
is determined based on quoted market prices.
Income Taxes
The Partnership is not liable for federal or state income taxes as
Partnership income or loss is allocated to the partners for income
tax purposes. In the event that the Partnership's tax returns are
examined by the Internal Revenue Service or state taxing authority
and the examination results in a change in the Partnership's taxable
income or loss, such change will be reported to the partners.
Impairment of Long Lived Assets
In accordance with Financial Accounting Standards No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to Be Disposed Of", which is effective for fiscal years
beginning after December 15, 1995, the Partnership has implemented
policies and practices for assessing impairment of its real estate
assets.
In assessing the impairment of the Joint Venture investment, the
General Partners routinely perform market and growth studies combined
with periodic appraisals of the underlying property. If the General
Partners believe there is impairment in value, a provision to write
down the investment to fair value will be charged against income. At
this time, the General Partners do not believe that any asset of the
Partnership is impaired.
<PAGE>
Reclassifications
Certain prior year balances have been reclassified to conform with
current year financial statement presentation.
C. Mortgage-Backed Securities
All of the MBS held by the Partnership are issued by the Federal Home
Loan Mortgage Corporation. The following is additional information on
the MBS held as of December 31, 1995 and 1994:
1995 1994
Face Value $931,197 $1,000,877
Amortized cost $915,554 $ 984,565
Estimated Market Value $940,000 $1,001,000
Coupon rates of the MBS range from 9.0% to 9.5% per annum and mature in
the years 2016 and 2017. The Partnership's MBS portfolio had gross
unrealized gains of approximately $24,446 and $16,435 at December 31,
1995 and 1994, respectively. The Partnership does not expect to
realize these gains as it has the intention and ability to hold the MBS
until maturity.
D. Investment in Joint Venture
On December 14, 1988, the Joint Venture acquired Spring Valley
Marketplace (the "Marketplace"), a 314,673 square foot shopping center
located on 30 acres of land in Spring Valley, Rockland County, New
York. The Joint Venture acquired the Marketplace for $50,000,000 and
incurred closing costs of $359,408 related to the acquisition. In
conjunction with a Net Operating Income Guaranty Agreement the Joint
Venture has collected $1,000,000, the maximum obligation due from the
seller, and has therefore reduced the cost basis of the Marketplace by
these amounts for financial reporting purposes.
The Marketplace, built in 1987, consists of one structure anchored by
five major tenants and is connected by five sections occupied by
smaller tenants. The Joint Venture owns the Marketplace free and clear
from all material liens or encumbrances.
The Partnership holds a 49.9% joint venture interest. The investment
balance reflects the original cost of the investment, including
$1,882,546 of acquisition costs, as well as allocations of net income
earned by the Joint Venture and distributions received from the Joint
Venture.
Separate financial statements for the Joint Venture are included on
pages F-13 through F-24 of this report.
E. Partners' Equity
Under the Partnership Agreement, profits or losses from Partnership
operations and Distributable Cash Flow are allocated 99% to the
<PAGE>
Unitholders and Corporate Limited Partner (the "Limited Partners")
based on Units held, and 1% to the General Partners.
Profits arising from a capital transaction will be allocated in the
same manner as cash distributions (described below). Losses from a
capital transaction will be allocated 99% to the Limited Partners and
1% to the General Partners.
Upon the occurrence of a capital transaction, as defined in the
Partnership Agreement, proceeds will be applied to the payment of all
debts and liabilities of the Partnership then due; any reserves for
contingent liabilities will then be funded. Remaining net cash
proceeds will then be distributed first to the Limited Partners, until
they have received a return of their total invested capital; second to
the General Partners, until they have received a return of their total
invested capital; third, to the Limited Partners until they have
received any deficiency in the 12% cumulative return on invested
capital through fiscal years prior to the date of the capital
transaction; fourth, to the General Partners until they have received
an amount necessary so that the amounts of net cash proceeds whenever
allocated under the third and fourth clauses are in the ratio of 90 to
10; and fifth, 90% to the Limited Partners and 10% to the General
Partners.
As of December 31, 1995, the following cumulative partner contributions
and allocations have been made since inception of the Partnership:
<TABLE>
<CAPTION>
Corporate
Limited General
Unitholders Partner Partners Total
<S> <C> <C> <C> <C>
Capital Contributions $ 41,203,189 $ 2,000 $ 3,000 $ 41,208,189
Syndication Costs (4,826,066) - - (4,826,066)
Distributions (14,976,190) (829) (92,131) (15,069,150)
Net Income (Loss) 4,872,996 (1,706) 46,252 4,917,542
Balance at
December 31, 1995 $ 26,273,929 $ (535) $(42,879) $ 26,230,515
</TABLE>
F. Related Party Transactions
Under the terms of the Partnership Agreement, the General Partners or
their affiliates are entitled to an Asset Management Fee for the
management of the Partnership's business equal to .5% per annum of the
Total Invested Assets of the Partnership (as defined in the prospectus),
payable quarterly. The Partnership also reimburses affiliates of the
General Partners for certain expenses incurred in connection with the
preparation and mailing of reports and other communications to the
Limited Partners.
All amounts paid or accrued to the General Partners or their affiliates
during the three years ended December 31, 1995 are presented on the
Statements of Income.
<PAGE>
G. Income Taxes
The reconciliations of net income reported in the accompanying
Statements of Income with the income reported in the Partnership's 1995,
1994 and 1993 federal income tax returns are as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Net income per statement of income $ 887,535 $603,140 $571,567
Add: Difference in Partnership's
share of Joint Venture
taxable net income due to
book to tax difference in
depreciation 264,724 248,722 213,702
Less: Partnership's share of difference
due to rental adjustment
required by Generally Accepted
Accounting Principles (9,071) (17,757) (17,087)
Net income for federal income tax
purposes $1,143,188 $834,105 $768,182
</TABLE>
The allocation of the 1995 net income for federal income tax purposes is as
follows:
<TABLE>
<CAPTION>
Portfolio Passive
Income Income Total
<S> <C> <C> <C>
Unitholders $239,112 $892,590 $1,131,702
Corporate Limited Partner 12 43 55
General Partners 2,415 9,016 11,431
$241,539 $901,649 $1,143,188
</TABLE>
For the years ended December 31, 1995, 1994 and 1993 the Average per Unit
income to the Unitholders for federal income tax purposes was $.55, $.40 and
$.37, respectively.
SPRING VALLEY PARTNERSHIP
FINANCIAL STATEMENTS AND SCHEDULE
For the Year Ended December 31, 1995
<PAGE>
SPRING VALLEY PARTNERSHIP
INDEX TO FINANCIAL STATEMENTS AND SCHEDULE
<PAGE>
Report of Independent Accountants F-15
Balance Sheets at December 31, 1995 and 1994 F-16
Statements of Operations for the Years Ended
December 31, 1995, 1994 and 1993 F-17
Statements of Changes in Partners' Equity for the Years
Ended December 31, 1995, 1994 and 1993 F-18
Statements of Cash Flows for the Years Ended
December 31, 1995, 1994 and 1993 F-19
Notes to Financial Statements F-20 - F-23
Schedule III - Real Estate and Accumulated Depreciation F-24
All other schedules are omitted as they are not applicable or not required,
or the information is provided in the financial statements or the notes
thereto.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Partners of
Spring Valley Partnership:
We have audited of financial statements and financial statement schedule of
Spring Valley Partnership ("the Partnership") listed in the index on page F-
14 of these Financial Statements. These financial statements and the
financial statement schedule are the responsibility of the Partnership's
management. Our responsibility is to express an opinion on these financial
statements and the financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards 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.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Spring Valley
Partnership as of December 31, 1995 and 1994, and the results of its
operations and its cash flows for each of the three years in the period
ended December 31, 1995 in conformity with generally accepted accounting
principles. In addition, in our opinion, the financial statement schedule
referred to above, when considered in relation to the basic financial
statements taken as a whole, presents fairly, in all material respects, the
information required to be included therein.
Boston, Massachusetts
January 31, 1996
<PAGE>
SPRING VALLEY PARTNERSHIP
BALANCE SHEETS
December 31, 1995 and 1994
ASSETS
<TABLE>
<CAPTION>
1995 1994
Fixed assets, at cost
<S> <C> <C>
Land $ 10,403,471 $ 10,403,471
Building and improvements 43,005,827 42,726,512
53,409,298 53,129,983
Less: Accumulated depreciation (12,084,310) (10,243,666)
Total fixed assets 41,324,988 42,886,317
Cash and cash equivalents 575,566 252,502
Other assets 916,171 772,544
Total assets $ 42,816,725 $ 43,911,363
LIABILITIES AND PARTNERS' EQUITY
Accounts payable $ 45,576 $ 8,532
Accrued expenses and other
liabilities (Note C) 187,937 195,054
Total liabilities 233,513 203,586
Partners' equity (Note D) 42,583,212 43,707,777
Total liabilities and Partners' equity $ 42,816,725 $ 43,911,363
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
SPRING VALLEY PARTNERSHIP
STATEMENTS OF OPERATIONS
For the Years Ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Rental revenue $6,544,064 $5,994,653 $5,840,455
Other income 35,233 26,811 20,871
Total revenues 6,579,297 6,021,464 5,861,326
Expenses:
Operating (Note F) 350,023 496,641 511,473
Maintenance 511,014 487,766 381,847
Management fees (Note F) 398,642 344,760 354,948
Real estate taxes 1,661,539 1,543,217 1,599,226
Depreciation 1,840,644 1,798,003 1,717,710
Total expenses 4,761,862 4,670,387 4,565,204
Net income (Note G) $1,817,435 $1,351,077 $1,296,122
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
SPRING VALLEY PARTNERSHIP
STATEMENTS OF CHANGES IN PARTNERS' EQUITY
For the Years Ended December 31, 1995, 1994, and 1993
<TABLE>
<CAPTION>
Berkshire
Cash Plus V Realty Total
Limited Company, Partners'
Partnership Inc. Equity
Balance at
<S> <C> <C> <C>
December 31, 1992 $23,454,712 $23,436,870 $46,891,582
Distributions (1,332,330) (1,337,670) (2,670,000)
Net income 646,761 649,357 1,296,118
Balance at
December 31, 1993 22,769,143 22,748,557 45,517,700
Distributions (1,577,339) (1,583,661) (3,161,000)
Net income 674,187 676,890 1,351,077
Balance at
December 31, 1994 21,865,991 21,841,786 43,707,777
Distributions (1,468,058) (1,473,942) (2,942,000)
Net income 906,900 910,535 1,817,435
Balance at
December 31, 1995 $21,304,833 $21,278,379 $42,583,212
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
SPRING VALLEY PARTNERSHIP
STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 1995, 1994 and 1993
<TABLE>
<CAPTION>
1995 1994 1993
Operating activities:
<S> <C> <C> <C>
Net income $ 1,817,435 $1,351,077 $ 1,296,122
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation 1,840,644 1,798,003 1,717,710
(Increase) decrease in other
assets (143,627) 119,721 66,224
Increase (decrease) in accounts
payable 37,044 (126,252) 34,906
Decrease in other liabilities (7,117) (5,574) (5,848)
Net cash provided by
operating activities 3,544,379 3,136,975 3,109,114
Investing activities:
Additions to fixed assets (279,315) (294,922) (421,520)
Net cash used in investing
activities (279,315) (294,922) (421,520)
Financing activity:
Distributions (2,942,000) (3,161,000) (2,670,000)
Net cash used in
financing activities (2,942,000) (3,161,000) (2,670,000)
Net increase (decrease) in cash 323,064 (318,947) 17,594
Cash and cash equivalents, beginning
of year 252,502 571,449 553,855
Cash and cash equivalents, end
of year $ 575,566 $ 252,502 $ 571,449
</TABLE>
The accompanying notes are an integral
part of the financial statements.
<PAGE>
SPRING VALLEY PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
A. Organization
Spring Valley Partnership was formed on December 13, 1988 by filing a
Business Certificate in the Commonwealth of Massachusetts. The
Partnership shall continue until December 31, 2027 unless earlier
terminated per the Partnership Agreement or by law. The original
General Partner interests were issued to Krupp Cash Plus-IV Limited
Partnership ("Cash Plus-IV"), 50.1%; Krupp Cash Plus-V Limited
Partnership ("Cash Plus-V"), .01%; and Krupp Realty Company Limited
Partnership ("Krupp Realty Company"), 49.89%. Pursuant to the original
Partnership Agreement, Cash Plus-V purchased Krupp Realty Company's
interest in the Partnership and succeeded to its capital contributions
and its share of profit and loss allocations and distributions. On June
25, 1991, The Partnership executed an Amended and Restated Partnership
Agreement, whereby Cash Plus-IV assigned its rights, title and interest
in the Partnership to Berkshire Realty Company, Inc. ("Berkshire"), a
Delaware Corporation. Pursuant to the Assignment and First Amendment to
Spring Valley Partnership Amended and Restated Partnership Agreement
dated May 1, 1995, Berkshire assigned 49.1% of its rights, title and
interest in the Partnership to BRI OP Limited Partnership ("BRI OP LP"),
its majority owned subsidiary. As of December 31, 1995, the General
Partners of the Partnership are BRI OP LP (49.1%) and Berkshire (1%),
collectively, "Berkshire Realty Company, Inc." (50.1%) and Cash Plus-V
Limited Partnership (49.9%). Profits and losses and distributions will
continue to be allocated to the General Partners based on the percentage
of their respective capital contributions to total partners' capital
contributions.
On December 14, 1988, the Partnership acquired Spring Valley Marketplace
(the "Marketplace"), a 314,673 square foot shopping center located on 30
acres of land in Spring Valley, Rockland County, New York. The
Partnership acquired the Marketplace for $50,000,000 and incurred
closing costs of $359,408 related to the acquisition. Additionally, the
Partnership executed a Net Operating Guaranty Agreement ("NOI Guaranty
Agreement") with the seller, by which, the seller would reimburse the
Partnership if the net operating income from the Marketplace did not
meet or exceed $4.3 million annually. Per the NOI Guaranty Agreement,
which expired on December 13, 1990, the seller's obligation was limited
to $1,000,000 on a cumulative basis. As a result of the NOI Guaranty
Agreement, the Partnership has collected $1,000,000, the maximum
obligation due from the seller, and has therefore reduced the cost basis
of the Marketplace by this amount for financial reporting purposes. The
Marketplace, built in 1987, consists of one structure anchored by five
major tenants and is connected by five sections occupied by smaller
tenants. The Partnership owns the Marketplace free and clear from all
material liens or encumbrances.
B. Significant Accounting Policies
The Partnership uses the following accounting policies for financial
reporting purposes, which may differ in certain respects from those used
for federal income tax purposes:
<PAGE>
Risks and Uncertainties
The Partnership invests its cash primarily in deposits and money
market funds with commercial banks. The Partnership has not
experienced any losses to date on its invested cash.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amount of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
Cash Equivalents
The Partnership includes all short-term investments with maturities of
three months or less from the date of acquisition in cash and cash
equivalents. Cash equivalents are recorded at cost, which
approximates current market value.
Rental Revenues
Leases require the payment of base rent monthly in advance. Rental
revenues are recorded on the accrual basis. Leases generally contain
provisions for additional rent based on a percentage of tenant sales
and other provisions which are also recorded on the accrual basis, but
are billed in arrears. Minimum rental revenue for long term
commercial leases is recognized on a straight-line basis over the life
of the related lease.
Depreciation
Depreciation of building and improvements is provided for by the use
of the straight-line method over estimated useful lives of 3-25 years.
Tenant improvements are depreciated over the life of the lease.
Impairment of Long-Lived Assets
In accordance with Financial Accounting Standards No. 121, "Accounting
for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed Of", which is effective for fiscal years beginning after
December 15, 1995, the Partnership has implemented policies and
practices for assessing impairment of its real estate assets.
The General Partners routinely perform market and growth studies
combined with periodic appraisals of their unleveraged real estate.
The property is carried at cost less accumulated depreciation unless
the General Partners believe there is significant impairment in value,
in which case a provision to write down the investment in property to
fair value will be charged against income. At this time, the General
Partners do not believe that any assets of the Partnership are
impaired.
Leasing Commissions
The Partnership amortizes leasing commissions over the life of the
lease.
<PAGE>
Income Taxes
The Partnership is not liable for federal or state income taxes
because Partnership income or loss is allocated to the partners for
income tax purposes. In the event the Partnership's tax returns are
examined by the Internal Revenue Service or state taxing authority and
such an examination results in a change in Partnership taxable income
or loss, such change will be reported to the partners.
C. Accrued Expenses and Other Liabilities
Accrued expenses and other liabilities consist of the following at
December 31, 1995 and 1994:
1995 1994
Accrued insurance $109,593 $106,504
Tenant security deposits 73,442 86,267
Other accrued expenses 4,902 2,283
$187,937 $195,054
D. Partner's Equity
Under the terms of the Partnership Agreement, profits, losses and
distributions are allocated 49.9% to Cash Plus V Limited Partnership and
50.1% to Berkshire Realty Company, Inc.
As of December 31, 1995, the following cumulative partner contributions
and allocations had been made since inception of the Partnership:
<TABLE>
<CAPTION>
50.1%
49.9% Berkshire
Cash Plus V Realty Total
Limited Company, Partners'
Partnership Inc. Equity
<S> <C> <C> <C>
Capital contributions $ 26,379,755 $ 26,373,641 $ 52,753,396
Distributions (10,415,947) (10,457,696) (20,873,643)
Allocation of net income 5,341,025 5,362,434 10,703,459
Total Partners' Equity
at December 31, 1995 $ 21,304,833 $ 21,278,379 $ 42,583,212
</TABLE>
E. Future Base Rents Due Under Commercial Operating Leases
Future base rents due under commercial operating leases in the five
years 1996 through 2000 are as follows:
1996 4,119,800
1997 4,206,900
1998 3,854,000
1999 3,441,700
2000 3,089,600
Thereafter 16,381,300
<PAGE>
F. Related Party Transactions
Property management fees are paid to an affiliate of the General
Partners monthly at the rate of up to 6% of rentals and other operating
income received by the Marketplace. The Partnership also reimburses
affiliates for certain expenses incurred in connection with operations
of the Partnership and its property including accounting, computer,
insurance, travel legal and payroll.
Amounts paid to affiliates of the General Partners included in the
accompanying financial statements were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Property management fees $398,642 $344,760 $354,948
Expense reimbursements 58,284 147,914 147,891
Charged to operations $456,926 $492,674 $502,839
</TABLE>
G. Federal Income Taxes
The reconciliation of the net income reported in the accompanying
statement of operations with the net income reported in the
Partnership's federal income tax returns is as follows:
<TABLE>
<CAPTION>
1995 1994 1993
Net income per statement
<S> <C> <C> <C>
of operations $1,817,435 $1,351,077 $1,296,122
Add:
Book to tax depreciation
difference 573,232 540,438 468,932
Less:
Rental adjustment required
by Generally Accepted
Accounting Principles (18,176) (35,585) (34,243)
Net income for federal
income tax purposes $2,372,491 $1,855,930 $1,730,811
</TABLE>
The allocation of the 1995 net income for federal income tax purposes is
as follows:
<PAGE>
<TABLE>
<CAPTION>
Passive Portfolio
Income Income Total
Cash Plus V
<S> <C> <C> <C> <C>
Limited Partnership $1,144,970 $ 17,581 $1,162,551
Berkshire Realty Company,
Inc. 1,192,288 17,652 1,209,940
$2,337,258 $ 35,233 $2,372,491
</TABLE>
The allocation of passive income differs due to individual Joint Venture
Partner depreciation elections.
<PAGE>
SPRING VALLEY PARTNERSHIP
SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
December 31, 1995
<TABLE>
<CAPTION>
Costs
Capitalized
Subsequent to
Initial Cost to Partnership Acquisition
Buildings & Buildings & Depreciable
Description Encumbrances Land Improvements Improvements Life
Spring Valley
<S> <C> <C> <C> <C> <C>
Marketplace $ - $10,403,471 $41,613,880 $1,391,947 3 to 25 Yrs
</TABLE>
<TABLE>
<CAPTION>
Gross Amounts Carried at
End of Year
Buildings Year
and Accumulated Construction Year
Description Land Improvements Total Deprecation Completed Acquired
Spring Valley
<S> <C> <C> <C> <C> <C> <C>
Marketplace $10,403,471 $43,005,827 $53,409,298 $12,084,310 1987 1988
</TABLE>
Reconciliation of Real Estate and Accumulated Depreciation for each of the
three years in the period ended December 31, 1995:
<PAGE>
<TABLE>
<CAPTION>
1995 1994 1993
Real Estate
Balance at
<S> <C> <C> <C>
beginning of year $53,129,983 $52,835,061 $52,413,541
Acquisition and
improvements 279,315 294,922 421,520
Balance at
end of year $53,409,298 $53,129,983 $52,835,061
Accumulated Depreciation
Balance at
beginning of year $10,243,666 $ 8,445,663 $ 6,727,953
Depreciation expense 1,840,644 1,798,003 1,717,710
Balance at end of year $12,084,310 $10,243,666 $ 8,445,663
</TABLE>
Note: The aggregate cost of the Partnership's real estate for federal
income tax purposes was $52,545,169 and the aggregate accumulated
depreciation for federal income tax purposes was $5,686,280 for the
year ended December 31, 1995.
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Cash Plus V
Financial Statements for the year ended December 31, 1995 and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 2,101,121
<SECURITIES> 915,554
<RECEIVABLES> 33,261<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,929
<PP&E> 23,187,379<F2>
<DEPRECIATION> 0
<TOTAL-ASSETS> 26,240,244
<CURRENT-LIABILITIES> 9,729
<BONDS> 0
<COMMON> 26,230,515<F3>
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 26,240,244
<SALES> 0
<TOTAL-REVENUES> 1,130,856<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 243,321<F5>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 887,535
<EPS-PRIMARY> 0<F6>
<EPS-DILUTED> 0<F6>
<FN>
<F1>Includes all receivables of teh Partnership included in "other assets" on the
balance sheet.
<F2>Represents the Partnership's investment in Joint Venture.
<F3>Equity of General Partners ($42,879) and Limited Partners of $26,273,394.
<F4>Includes all revenue of the Partnership.
<F5>Includes all expenses of the Partnership.
<F6>Net income allocated $8,875 to the General Partners and $878,660 to the Limited
Partners. Average net income is $.42 on 2,060,450 units outstanding.
</FN>
</TABLE>
