- --------------------------------------------------------------------------------
FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
(As last amended by 34-32231, eff. 6/3/93.)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB/A
(Mark One)
[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.........to.........
Commission file number 0-19246
CLOVER INCOME PROPERTIES III, L.P.
(Exact name of small business issuer as specified in its charter)
Delaware 22-2935727
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
23 West Park Avenue
Merchantville, New Jersey 08109
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (609) 662-1116
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 .
--- ---
- --------------------------------------------------------------------------------
<PAGE>
Item 1. Financial Statements
CLOVER INCOME PROPERTIES III, L.P.
BALANCE SHEET
(Unaudited)
ASSETS
<TABLE>
<CAPTION>
March 31,
1996
-----------
<S> <C>
CASH ........................................................ $ 125,946
INVESTMENT IN THE WILLOWBROOK JOINT
VENTURE, at market ................................. 1,343,487
-----------
TOTAL ASSETS ................................................ $ 1,469,433
===========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
LIABILITIES
Accrued expenses ............................................ $ 12,719
-----------
PARTNERS' CAPITAL (DEFICIT)
General partner .................................... (45,349)
Limited partners ................................... 1,502,063
-----------
Total partners' capital ................... 1,456,714
-----------
TOTAL LIABILITIES AND PARTNERS' CAPITAL (DEFICIT) ........... $ 1,469,433
===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
1
<PAGE>
CLOVER INCOME PROPERTIES III, L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
-------- --------
<S> <C> <C>
REVENUES
Interest income ........................................................... $ 676 $ 387
-------- --------
Total revenues ........................................................ 676 387
-------- --------
EXPENSES
Impairment loss, investment in joint
venture ............................................................... 40,000 --
Amortization .............................................................. -- 2,379
Professional services ..................................................... 7,074 6,199
General and administrative ................................................ 379 2,768
-------- --------
Total expenses ........................................................ 47,453 11,346
-------- --------
SHARE OF INCOME FROM THE WILLOWBROOK JOINT
VENTURE ................................................................... 14,619 8,103
-------- --------
NET (LOSS) ..................................................................... $(32,158) $ (2,856)
======== ========
NET INCOME (LOSS) PER
LIMITED PARTNERSHIP UNIT ....................................................... $ (4.36) $ (.39)
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
CLOVER INCOME PROPERTIES III, L.P.
STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
FOR THE THREE MONTHS ENDED MARCH 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
----------- ----------- -----------
<S> <C> <C> <C>
Balance (Deficit) at January 1, 1996 ....................... $ (44,927) $ 1,543,754 $ 1,498,827
Partners' distributions, $1.35 per
limited partnership unit .............................. (100) (9,855) (9,955)
Net loss ................................................... (322) (31,836) (32,158)
----------- ----------- -----------
Balance (Deficit) at March 31, 1996 ........................ $ (45,349) $ 1,502,063 $ 1,456,714
=== ==== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
CLOVER INCOME PROPERTIES III, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Interest income received .................................................... $ 676 $ 387
Distributions received from The Willowbrook
Joint Venture ........................................................... 14,619 8,103
Cash paid for operating expenses ............................................ (14,234) (25,509)
--------- ---------
Net cash provided by (used in) operating
activities .............................................................. 1,061 (17,019)
--------- ---------
INVESTING ACTIVITIES
Distributions received from The Willowbrook
Joint Venture ........................................................... 11,967 18,483
--------- ---------
FINANCING ACTIVITIES
Partners' distributions ..................................................... (9,955) (14,746)
--------- ---------
NET INCREASE (DECREASE) IN CASH .................................................. 3,073 (13,282)
CASH, beginning of period ........................................................ 122,873 116,337
--------- ---------
CASH, end of period .............................................................. $ 125,946 $ 103,055
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
CLOVER INCOME PROPERTIES III, L.P.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
--------- ---------
<S> <C> <C>
RECONCILIATION OF NET (LOSS) TO CASH
PROVIDED BY (USED IN) OPERATING ACTIVITIES
Net income (loss) ............................................................. $(32,158) $ (2,856)
ADJUSTMENTS
Impairment loss, investment in joint venture .................................. 40,000
Amortization .................................................................. -- 2,379
Income from investment in the Willowbrook Joint
Venture ................................................................... (14,619) (8,103)
Distributions received from the Willowbrook
Joint Venture ............................................................. 14,619 8,103
Decrease in accrued expenses .................................................. (6,781) (6,147)
Decrease in due to affiliates ................................................. -- (10,395)
-------- --------
Total adjustments ....................................................... $ 33,219 $(14,163)
-------- --------
Net cash provided by (used in) operating activities ................................ $ 1,061 $(17,019)
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
CLOVER INCOME PROPERTIES III, L.P.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996
(Unaudited)
Readers of this quarterly report should refer to the Partnership's audited
financial statements as of December 31, 1995, as certain footnote disclosures
which would substantially duplicate those contained in such audited financial
statements have been omitted from this report.
1. INVESTMENT IN THE WILLOWBROOK JOINT VENTURE:
On April 8, 1992, the Partnership consummated a transaction which was effective
April 1, 1992, with the Willowbrook Joint Venture, Clover Income Properties,
L.P. ("CIP"), and Clover Income Properties II, L.P. ("CIP II"), affiliated
partnerships, for the acquisition by the Partnership of an interest in the
Willowbrook Joint Venture (the "Joint Venture"), which owns the Willowbrook
Apartments, a 299-unit mid-rise apartment complex located in Baltimore,
Maryland. The Partnership acquired a 14.18% interest in the Joint Venture for a
cash purchase price of $2,200,000. The excess of the amount paid over the net
book value of the 14.18% interest in the Joint Venture purchased by CIP III
amounted to $651,576. This amount was allocated by the Joint Venture to land and
building in the amounts of $75,452 and $576,124, respectively.
On February 7, 1996, the Willowbrook Joint Venture entered into an agreement of
sale with Berwind Properties Group, Inc. and First Montgomery Properties, Ltd.
Under the terms of the agreement as amended on May 16, 1996, the Joint Venture
will sell the Willowbrook Apartments (including land), all related improvements
and tangible and intangible property for $9,850,000.
The sale is contingent upon, among other things, the approval by a majority of
the limited partners of CIP, CIP II, and CIP III. If the sale is approved by a
majority of the limited partners and all the other conditions to the sale are
met, the sale will be completed.
Concurrent with the sale of The Willowbrook Apartments, all assets of the Joint
Venture will be liquidated. The net proceeds will be distributed to its owners
(CIP, CIP II and CIP III) and the Joint Venture dissolved.
Upon receipt of distribution from the Joint Venture, the limited partnership
will then liquidate the net assets, distribute the proceeds and be dissolved.
Due to the proposed sale of the Willowbrook Apartments and subsequent
liquidation of the Partnership, CIP III has reflected its investment in the
Joint Venture at the lower of cost or market. Market value is based on the
estimated cash proceeds (net of settlement costs) from the sale of the
Willowbrook Apartments after allocation of these proceeds to CIP, CIP II, and
CIP III. At March 31, 1996, the CIP III's investment in the Willowbrook Joint
Venture was impaired. At March 31, 1996, the charge to operations amounting to
$40,000 has been reflected as an impairment loss in the Statement of Operations.
6
<PAGE>
CLOVER INCOME PROPERTIES III, L.P.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996
(Unaudited)
1. INVESTMENT IN THE WILLOWBROOK JOINT VENTURE (continued):
A summary of the Joint Venture's financial statements is as follows:
<TABLE>
<CAPTION>
Three Months
Ended March 31,
1996
---------------
<S> <C>
Current assets ................................................. $ 397,270
Investment property, net of accumulated depreciation ........... 9,276,510
Other noncurrent assets ........................................ 1,100
----------
Total assets ................................................... $9,674,880
==========
Current liabilities ............................................ $ 438,232
Capital -
Clover Income Properties, L.P. ............................. 3,637,651
Clover Income Properties II, L.P. .......................... 3,637,651
Clover Income Properties III, L.P. ......................... 1,961,346
----------
Total liabilities and capital .................................. $9,674,880
==========
Revenues ....................................................... $ 524,072
Expenses ....................................................... 415,396
----------
Net income ..................................................... $ 108,676
==========
</TABLE>
The Joint Venture made distributions from operations to the Partnership in the
amount of $26,586 during the first three months of 1996. (Also, see Note 2).
7
<PAGE>
CLOVER INCOME PROPERTIES III, L.P.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996
(Unaudited)
2. SUBSEQUENT DISTRIBUTION:
In April 1996, the Partnership received an $8,862 distribution from the
Willowbrook Joint Venture. It is anticipated that the Partnership will make a
cash distribution in May 1996 of $9,855 to the limited partners and $100 to the
general partner.
3. GENERAL:
The financial statements reflect all adjustments which are, in the opinion of
the General Partner, necessary for a fair presentation of the results for the
interim period presented. Such adjustments are of a normal recurring nature.
8
<PAGE>
THE WILLOWBROOK JOINT VENTURE
BALANCE SHEET
(Unaudited)
ASSETS
<TABLE>
<CAPTION>
March 31,
1996
---------------
<S> <C>
CURRENT ASSETS
Cash .................................................. $ 271,377
Cash held for security deposits-restricted ............ 34,215
Prepaid expenses ...................................... 88,850
Rents receivable ...................................... 2,828
------------
Total current assets .............................. 397,270
------------
INVESTMENT PROPERTY HELD FOR SALE .......................... 13,440,465
Less - accumulated depreciation ....................... (4,163,955)
Net investment property ........................... 9,276,510
OTHER ASSETS
Utility deposit ....................................... 1,100
------------
TOTAL ASSETS ............................................... $ 9,674,880
============
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES
Accounts payable ...................................... $ 17,500
Accrued expenses ...................................... 53,398
Tenants' security deposits ............................ 34,215
Prepaid rents ......................................... 6,826
Due to affiliates ..................................... 326,293
------------
Total current liabilities ......................... 438,232
------------
PARTNERS' CAPITAL
Clover Income Properties, L.P. ........................ 3,637,651
Clover Income Properties II, L.P. ..................... 3,637,651
Clover Income Properties III, L.P. .................... 1,961,346
------------
Total partners' capital ........................... 9,236,648
------------
TOTAL LIABILITIES AND PARTNERS' CAPITAL .................... $ 9,674,880
============
</TABLE>
The accompanying notes are an integral part of these statements.
9
<PAGE>
THE WILLOWBROOK JOINT VENTURE
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
-------- --------
<S> <C> <C>
REVENUES:
Rental income ............................................................... $511,753 $494,733
Other income ................................................................ 12,181 5,584
Interest income ............................................................. 138 484
-------- --------
Total revenues ..................................................... 524,072 500,801
-------- --------
EXPENSES:
Depreciation ................................................................ 128,711 128,253
Operating expenses (including affiliate
transactions of $16,089 for the
three months ended March 31, 1995) ...................................... 284,747 261,502
Professional services ....................................................... 1,938 4,948
-------- --------
Total expenses ..................................................... 415,396 394,703
-------- --------
NET INCOME ....................................................................... $108,676 $106,098
======== ========
</TABLE>
The accompanying notes are an integral part of these statements.
10
<PAGE>
THE WILLOWBROOK JOINT VENTURE
STATEMENTS OF PARTNERS' CAPITAL
FOR THE THREE MONTHS ENDED MARCH 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
Clover Clover Clover
Income Income Income
Properties Properties Properties
L.P. II, L.P. III, L.P. Total
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Balance - January 1, 1996 .................. $ 3,671,476 $ 3,671,476 $ 1,972,520 $ 9,315,472
Net income ................................. 46,632 46,632 15,412 108,676
Partners' distributions .................... (80,457) (80,457) (26,586) (187,500)
----------- ----------- ----------- -----------
Balance at March 31, 1996 .................. $ 3,637,651 $ 3,637,651 $ 1,961,346 $ 9,236,648
=========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
11
<PAGE>
THE WILLOWBROOK JOINT VENTURE
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES:
Cash received from rentals ............................................. $ 515,473 $ 490,830
Other income received .................................................. 12,181 5,584
Interest income received ............................................... 138 484
Security deposits paid (received) ...................................... 653 (202)
Cash paid for operating expenses ....................................... (202,594) (224,314)
--------- ---------
Net cash provided by operating
activities ................................................ 325,851 272,382
--------- ---------
INVESTING ACTIVITIES
Cash paid for investment property ...................................... (8,468) --
--------- ---------
FINANCING ACTIVITIES
Partners' distributions ................................................ (187,500) (187,500)
--------- ---------
NET INCREASE IN CASH ........................................................... 129,883 84,882
Cash, beginning of period ...................................................... 141,494 146,687
--------- ---------
Cash, end of period ............................................................ $ 271,377 $ 231,569
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
12
<PAGE>
THE WILLOWBROOK JOINT VENTURE
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
--------- ---------
<S> <C> <C>
RECONCILIATION OF NET INCOME
TO NET CASH PROVIDED BY OPERATING ACTIVITIES
NET INCOME ............................................................... $ 108,676 $ 106,098
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation ................................................................. 128,711 128,253
Decrease (increase) in cash held for
security deposits ........................................................ 653 (202)
Decrease in prepaid expenses ................................................. 48,164 58,063
Decrease (increase) in rents receivable ...................................... 4,774 (4,129)
Increase (decrease) in accounts payable ...................................... 17,500 (1,849)
Increase (decrease) in accrued expenses ...................................... 16,442 (12,923)
Increase (decrease) in security deposits ..................................... 1,993 (1,194)
(Decrease) increase prepaid rents ............................................ (1,062) 226
Increase in due to affiliates ................................................ -- 39
--------- ---------
Total adjustments ................................................................ 217,175 166,284
--------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES ........................................ $ 325,851 $ 272,382
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
13
<PAGE>
THE WILLOWBROOK JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996
(UNAUDITED)
Readers of this quarterly report should refer to the Joint Venture's audited
financial statements as of December 31, 1995, as certain footnote disclosures
which would substantially duplicate those contained in such audited financial
statements have been omitted from this report.
1. INVESTMENT PROPERTY HELD FOR SALE:
On December 17, 1987, the Joint Venture acquired the Willowbrook Apartments, a
mid-rise apartment complex comprising 299 apartment units contained in eight
five-story buildings. The complex is located in Baltimore, Maryland.
On February 7, 1996, the Joint Venture entered into an agreement of sale with
Berwind Properties Group, Inc. and First Montgomery Properties, Ltd. Under the
terms of the agreement, as amended on May 16, 1996, the Joint Venture will sell
The Willowbrook Apartments (including land), all related improvements and
tangible and intangible property for $9,850,000.
The sale must be approved by a majority of the limited partners of CIP, CIP
II, and CIP III. Upon sale of The Willowbrook Apartments, all assets of the
Joint Venture will be liquidated. The net proceeds will then be distributed to
its owners (CIP, CIP II, and CIP III) and the Joint Venture dissolved.
Due to the proposed sale of The Willowbrook Apartments and subsequent
liquidation of the Partnership, the Joint Venture has reflected the investment
property held for sale at the lower of cost or market. Market value is based on
the estimated cash proceeds (net of settlement costs) from the sale of the
Willowbrook Apartments. At March 31, 1996, the investment property held for sale
was not impaired.
The following is a summary of investment property as of March 31, 1996.
Land ......................................... $ 1,421,205
Building ..................................... 11,006,247
Furniture and fixtures ....................... 1,013,013
------------
13,440,465
Less: Accumulated depreciation ........... (4,163,955)
------------
$ 9,276,510
============
14
<PAGE>
THE WILLOWBROOK JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS - CONTINUED
MARCH 31, 1996
(UNAUDITED)
2. TRANSACTIONS WITH AFFILIATES:
Effective February 21, 1995, NPI-CL Management, L.P. ("NPI") which is
unaffiliated with the general partner, replaced an affiliate of the general
partner as Property Manager. Until this time, as compensation for property
management services performed by an affiliate of the Partners with respect to
the Property, the affiliate was entitled to a management fee in an amount not to
exceed 5% of gross revenues. On January 19, 1996, the stockholders of National
Property Investors, Inc. sold all of its issued and outstanding stock to IFGP
Corporation, an affiliate of Insignia Financial Group, Inc.
The general partners of CIP, CIP II, and CIP III and their affiliates were
entitled to reimbursement for administrative services rendered to the Joint
Venture and direct expenses of operations and goods and services used by and for
the Joint Venture. For the three months ended March 31, 1995, $3,339 of such
costs were incurred by the Joint Venture. Property management fees of $12,750
were incurred and paid for the three months ended March 31, 1995, to an
affiliate of the general partner. During the three months ended March 31, 1996,
there were no transactions with affiliates.
As of March 31, 1996, The Willowbrook Joint Venture owed a total of $326,293 to
Clover and its affiliates, including $7,161 for reimbursable costs and $319,132
for accrued property management fees. The payment of such amounts will be made
from the Willowbrook Joint Venture's cash flow when available and from the
proceeds of any sale or refinancing of the assets of the Willowbrook Joint
Venture.
3. SUBSEQUENT DISTRIBUTIONS:
In April 1996, the Joint Venture paid total distributions of $62,500 to its
partners.
4. GENERAL:
The financial statements reflect all adjustments which are, in the opinion of
the joint venture partners, necessary for a fair statement of results for the
interim periods presented. Such adjustments are of a normal recurring nature.
Certain reclassifications have been made to the 1995 information to conform to
the 1996 presentation.
15
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Financial Condition Liquidity and Capital Resources
The Partnership's only remaining interest in real estate is a 14.18%
interest in The Willowbrook Joint Venture, a joint venture which owns the
Willowbrook Apartments. Consequently, the Partnership's primary remaining source
of operating cash flow will be distributions from The Willowbrook Joint Venture.
On February 7, 1996, the Willowbrook Joint Venture, Berwind Property Group,
Inc. ("Berwind") and First Montgomery Properties, Ltd. ("First Montgomery", and
with Berwind, the "Buyers") executed an Agreement of Sale (as amended, the "Sale
Agreement") concerning the sale of Willowbrook Apartments (the "Sale").
Pursuant to the terms of the Sale Agreement, the Buyers have agreed to
purchase The Willowbrook Apartments for a purchase price of $9,850,000. The
completion of the Sale is contingent upon the approval of the holders of more
than 50% of the outstanding Units and the holders of more than 50% of the
outstanding units of limited partnership interest in each of CIP II and CIP III.
If such approval is not obtained on or before June 30, 1996, the Sale Agreement
shall be automatically cancelled and terminated.
Cash on hand on March 31, 1996 was $125,946 as compared to $122,873 on
December 31, 1995. Current funds, along with future operating cash flow, will be
utilized for working capital needs and for distributions to the limited
partners.
The Partnership's net cash flow from operations was $1,061 for the three
months ended March 31, 1996, as compared to cash flow used in operations of
$17,019 for the same period in 1995. The increase in net cash flow from
operations for the three months ended March 31, 1996 is attributable to a
decrease in cash paid for operating expenses and an increase in distributions
received from the Willowbrook Joint Venture.
The Joint Venture's net cash flow from operations was $325,851 for the three
months ended March 31, 1996, as compared to $272,382 for the same period in
1995. The increase in cash flow from operations over the period was due to an
increase in cash received from rentals and other income, in addition to a
decrease in cash paid for operating expenses.
Cash distributions by the Partnership to the partners with respect to the
quarter ended December 31, 1995 of $9,955 were paid in January 1996. Of the
total amount, $9,855 was distributed to the Limited Partners and $100 was
distributed to the General Partner.
The General Partner believes that the Partnership's current and future cash
availability will be sufficient to meet the Partnership's liquidity
requirements, absent any unanticipated cost increases or adverse market
conditions.
If the Sale is approved by the Limited Partners and completed, the proceeds
from the Sale distributed by the Joint Venture will be sufficient to cover the
anticipated operating costs of the Sale estimated to be $832,000.
As of March 31, 1996, the Partnership has paid all outstanding amounts owed
to Clover and its affiliates. There were no outstanding amounts owed to Clover
and its affiliates and the Partnership made no payments to Clover and its
affiliates during the three months ended March 31, 1996.
16
<PAGE>
As of March 31, 1996, The Willowbrook Joint Venture owed a total of $326,293
to Clover and its affiliates, including $7,161 for reimbursable costs and
$319,132 for accrued property management fees. The payment of such amounts will
be made from The Willowbrook Joint Venture's cash flow when available and from
the proceeds of any sales or refinancing of the assets of The Willowbrook Joint
Venture.
During the first quarter of 1996, The Willowbrook Joint Venture continued
its program instituted in 1993 at The Willowbrook Apartments to upgrade
apartment interiors with new appliances and carpeting, combined with an
aggressive marketing program.
Effective February 21, 1995, the General Partner and certain of its
affiliates entered into an agreement with NPI-CL Management L.P. ("NPI"), an
entity unaffiliated with the Partnership or its General Partner, pursuant to
which NPI began providing day-to-day asset management services for the
Partnership as well as property management services for the Joint Venture. NPI
is an affiliate of National Property Investors, Inc. On January 19, 1996, the
stockholders of National Property Investors, Inc. sold all of its issued and
outstanding stock to IFGP Corporation, an affiliate of Insignia Financial Group,
Inc.
Results of Operations
Three Months Ended March 31, 1996 vs. March 31, 1995
Partnership revenues do not include the revenues from the Willowbrook
Apartments.
The Partnership's loss after amortization for the three months ended March
31, 1996, was $32,158 compared to a loss after amortization of $2,856 for the
same period in 1995. The increased loss after amortization for the three months
ended March 31, 1996 is primarily due to an impairment loss on the Partnership's
investment in the Willowbrook Joint Venture partially offset by an increase in
the Partnership's share of income from The Willowbrook Joint Venture.
Rental income for the Willowbrook Apartments, as operated by The Willowbrook
Joint Venture for the three months ended March 31, 1996, was $511,753 as
compared to $494,733 for the same period in 1995. Other income for the three
months ended March 31, 1996 was $12,181 as compared to $5,584 for the same
period in 1995. Interest income for the three months ended March 31, 1996 was
$138 as compared to $484 for the same period in 1995. The increase in rental
income is primarily the result of an increase in average rental rates over the
period. The change in other income was due to increased miscellaneous charges to
tenants including late fees and utility reimbursements.
The average effective rental rates for The Willowbrook Apartments for the
three months ended March 31, 1996 were $1,839 as compared to $1,787 for the same
period in 1995. The average occupancy for the Willowbrook Apartments for the
three months ended March 31, 1996 was 93.0% as compared to 92.6% for the same
period in 1995.
Operating expenses for The Willowbrook Apartments for the three months ended
March 31, 1996 were $284,747 as compared to $261,502 for the same period in
1995. The increase in operating expenses over the period is primarily the result
of increased snow removal, maintenance, and utility expenses. These increases
can be attributed to the severe winter conditions in the first quarter of 1996
at the property.
The Joint Venture's income after depreciation for the three months ended
March 31, 1996 was $108,676 as compared to $106,098 for the same period in 1995.
The increase in income after depreciation in 1996 is primarily the result of
increased rental income offset by an increase in operating expenses.
17
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CLOVER INCOME PROPERTIES III, L.P.
By: CROWN MANAGEMENT CORP.
By: /s/Donald N. Love
-----------------------------
Donald N. Love, President
By: /s/Stanley G. Borucki
-----------------------------
Stanley G. Borucki, Treasurer
Date: June 4, 1996
18
<PAGE>
