<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1996
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _______________________ to ______________________
Commission file number 0-20638
PRUDENTIAL-BACHE TAX CREDIT PROPERTIES L.P.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 13-3519080
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Seaport Plaza, New York, New York 10292-0116
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 214-1016
N/A
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by check CK 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 _CK_ No __
<PAGE>
<PAGE>
Part I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PRUDENTIAL-BACHE TAX CREDIT PROPERTIES L.P.
(a limited partnership)
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
<TABLE>
<CAPTION>
June 30, March 31,
1996 1996
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------
ASSETS
Investment in property:
Land $ 4,005,633 $ 4,005,633
Buildings and improvements 74,583,558 74,583,558
Accumulated depreciation (11,618,722 ) (11,073,281)
------------- -----------
Net investment in property 66,970,469 67,515,910
Cash and cash equivalents 1,088,897 1,012,131
Cash and cash equivalents held in escrow 947,403 613,065
Deferred financing costs, net 3,311,019 3,386,089
Organizational costs, net 61,278 69,056
Other assets 267,723 348,668
------------- -----------
Total assets $ 72,646,789 $72,944,919
------------- -----------
------------- -----------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Mortgage notes payable $ 46,349,965 $46,378,992
Accrued interest payable 1,297,463 1,044,112
Other accrued expenses and liabilities 1,258,801 1,355,458
Due to general partners and affiliates of local partnerships 1,536,125 1,539,945
Development fees payable 1,579,709 1,579,709
Construction costs payable 605,358 605,358
Real estate taxes payable 303,162 87,289
Due to General Partner and its affiliates 473,437 368,849
------------- -----------
Total liabilities 53,404,020 52,959,712
------------- -----------
Minority interest in local partnerships 3,591,190 3,712,217
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Contingencies
Partners' capital (deficit)
Limited partners (38,125 BUC$ issued and outstanding) 15,836,662 16,451,859
General Partner (1 BUC issued and outstanding) (185,083 ) (178,869)
------------- -----------
Total partners' capital 15,651,579 16,272,990
------------- -----------
Total liabilities and partners' capital $ 72,646,789 $72,944,919
------------- -----------
------------- -----------
<CAPTION>
- ---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated statements
</TABLE>
2
<PAGE>
<PAGE>
PRUDENTIAL-BACHE TAX CREDIT PROPERTIES L.P.
(a limited partnership)
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For the Three Months
Ended June 30,
-------------------------
1996 1995
<S> <C> <C>
- --------------------------------------------------------------------------------------------------
REVENUES
Rental income $2,221,545 $2,181,024
Other income 58,474 108,753
Interest income 5,761 6,316
---------- ----------
2,285,780 2,296,093
---------- ----------
EXPENSES
Interest 1,072,456 1,069,912
Depreciation and amortization 628,289 639,726
Operating and other 356,967 338,354
Taxes and insurance 293,636 282,975
Repairs and maintenance 408,597 325,285
General and administrative 93,063 93,047
Partnership management fees 85,434 85,434
Property management fees 89,776 91,514
---------- ----------
3,028,218 2,926,247
---------- ----------
Loss before minority interest (742,438) (630,154)
Minority interest in loss of local
partnerships 121,027 101,645
---------- ----------
Net loss $ (621,411) $ (528,509)
---------- ----------
---------- ----------
ALLOCATION OF NET LOSS
Limited partners $ (615,197) $ (523,224)
---------- ----------
---------- ----------
General Partner $ (6,214) $ (5,285)
---------- ----------
---------- ----------
Net loss per limited partner BUC $ (16.14) $ (13.72)
---------- ----------
---------- ----------
- --------------------------------------------------------------------------------------------------
</TABLE>
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL
(Unaudited)
<TABLE>
<CAPTION>
LIMITED GENERAL
BUC$ PARTNERS PARTNER TOTAL
<S> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------
Partners' capital (deficit)--March 31, 1996 38,126 $16,451,859 $(178,869) $16,272,990
Net loss -- (615,197) (6,214) (621,411)
------ ----------- --------- -----------
Partners' capital (deficit)--June 30, 1996 38,126 $15,836,662 $(185,083) $15,651,579
------ ----------- --------- -----------
------ ----------- --------- -----------
- -----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated statements
</TABLE>
3
<PAGE>
<PAGE>
PRUDENTIAL-BACHE TAX CREDIT PROPERTIES L.P.
(a limited partnership)
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For the Three Months
Ended June 30,
-------------------------
1996 1995
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (621,411) $ (528,509)
---------- ----------
Adjustments to reconcile net loss to net cash provided by (used in)
in operating activities:
Depreciation and amortization 628,289 639,726
Minority interest in loss of local partnerships (121,027) (101,645)
(Increase) decrease in cash held in escrow (334,338) 190,089
Increase (decrease) in real estate taxes payable 215,873 (286,294)
Increase in accrued interest payable 253,351 --
(Increase) decrease in other assets 80,945 (72,747)
Increase in other liabilities 4,111 3,502
---------- ----------
Total adjustments 727,204 372,631
---------- ----------
Net cash provided by (used in) operating activities 105,793 (155,878)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on mortgage notes (29,027) (17,635)
Advances pursuant to operating deficit guaranties -- 60,000
Payments for loans from local general partners -- (27,751)
---------- ----------
Net cash provided by (used in) financing activities (29,027) 14,614
---------- ----------
Net increase (decrease) in cash and cash equivalents 76,766 (141,264)
Cash and cash equivalents at beginning of period 1,012,131 1,201,654
---------- ----------
Cash and cash equivalents at end of period $1,088,897 $1,060,390
---------- ----------
---------- ----------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest paid $ 801,425 $ 916,882
---------- ----------
---------- ----------
- ---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated statements
</TABLE>
4
<PAGE>
<PAGE>
PRUDENTIAL-BACHE TAX CREDIT PROPERTIES L.P.
(a limited partnership)
AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1996
(Unaudited)
A. General
These consolidated financial statements have been prepared without audit. In
the opinion of management, the consolidated financial statements contain all
adjustments (consisting of only normal recurring adjustments) necessary to
present fairly the financial position of Prudential-Bache Tax Credit Properties
L.P. (the ``Partnership'') as of June 30, 1996, the results of its operations
and its cash flows for the three months ended June 30, 1996 and 1995. However,
the operating results for the interim periods may not be indicative of the
results expected for a full year.
Certain information and footnote disclosures normally included in
consolidated financial statements prepared in accordance with generally accepted
accounting principles have been omitted. It is suggested that these consolidated
financial statements be read in conjunction with the consolidated financial
statements and notes thereto included in the Partnership's Annual Report on Form
10-K filed with the Securities and Exchange Commission for the year ended March
31, 1996.
The Partnership invests in partnerships (the ``Local Partnerships'') which
own the properties. The financial statements of the Local Partnerships
consolidated herein are for the three month periods ended March 31, and
occupancy rates are as of March 31.
Certain balances from prior periods have been reclassified to conform with
the current financial statement presentation.
B. Related Parties
Prudential-Bache Properties, Inc. (the ``General Partner'' or ``PBP'') and
its affiliates perform services for the Partnership which include, but are not
limited to: accounting and financial management, registrar, transfer and
assignment functions, asset management, investor communications, printing and
other administrative services. The General Partner and its affiliates receive
management fees and reimbursements for general and administrative costs incurred
in connection with these services, the amount of which is limited by the
provisions of the Partnership Agreement. The costs and expenses incurred were:
<TABLE>
<CAPTION>
Three Months
Ended June 30,
---------------------
1996 1995
<S> <C> <C>
- --------------------------------------------------------------
Management fees $ 85,434 $ 85,434
General and administrative 20,605 19,836
-------- --------
$106,039 $105,270
-------- --------
-------- --------
</TABLE>
As of June 30, 1996, Due to General Partner and its affiliates includes
$430,794 relating to management fees payable and $42,643 relating to
reimbursement of general and administrative costs.
A portion of the management fees paid to the General Partner is remitted to
an affiliate of the Local General Partner of five of the Local Partnerships. The
General Partner has deferred the receipt of its management fee since January 1,
1995 and has deferred the receipt of the reimbursement of general and
administrative costs incurred on behalf of the Partnership since April 1, 1996.
The Partnership maintains an account with the Prudential Tax Free Money Fund,
an affiliate of PBP, for investment of its available cash in short-term
instruments.
Prudential Securities Incorporated (``PSI''), an affiliate of PBP, owns 56
BUC$ at June 30, 1996.
5
<PAGE>
<PAGE>
PRUDENTIAL-BACHE TAX CREDIT PROPERTIES L.P.
(a limited partnership)
AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
Prudential-Bache Tax Credit Properties L.P. (the ``Partnership'') invested in
eight Local Partnerships that are owners of low-income multi-family residential
complexes. The Local Partnerships are operated in accordance with the low-income
housing rules and regulations in order to protect the related tax credits. The
Partnership's primary sources of funds are rental revenues (which are fully
utilized at the property level) and, to a lesser extent, interest earned on
working capital reserves. A working capital reserve ($190,000 at June 30, 1996)
is maintained to fund operations and contingencies of the Partnership. The
working capital reserve is invested in a tax-free money fund. Based on the
current level of the Partnership's working capital reserve, the General Partner
has deferred the receipt of its management fee since January 1, 1995 and the
reimbursement of general and administrative costs incurred on behalf of the
Partnership since April 1, 1996.
At the Local Partnership level, some Local General Partners and/or their
affiliates have made guaranties with respect to the Local Partnerships which,
under certain circumstances, require their funding cash flow deficits pursuant
to deficit guaranty agreements, the majority of which are unsecured. As of June
30, 1996, there are open operating deficit guarantee commitments at Papillion
Heights and Summer Creek Villas.
The Local Partnerships generated net operating income before debt service of
$1,090,000 and $1,217,000 during the three month periods ended June 30, 1996 and
1995, respectively. Debt service payments (interest and principal) made during
the same periods were $830,000 and $935,000, respectively.
Results of Operations
The operating results of the Local Partnerships consolidated herein are for
the three-month periods ended March 31. Information disclosed below with respect
to each Local Partnership is consistent with this method of presentation.
Net operating income before debt service of the Local Partnerships was as
follows:
<TABLE>
<CAPTION>
Three Months
Ended June 30,
-------------------------
Property 1996 1995
<S> <C> <C>
- ------------------------------------------------------------------------
Hubbard's Ridge $ 48,000 $ 70,000
Cutler Canal II 136,000 150,000
Diamond Street 22,000 24,000
Papillion Heights 33,000 35,000
Hill Top Homes 103,000 130,000
Summer Creek Villas 650,000 707,000
Brookland Park Plaza 61,000 62,000
Compton Townhouses 37,000 39,000
---------- ----------
$1,090,000 $1,217,000
---------- ----------
---------- ----------
</TABLE>
Rental income increased $41,000 for the three months ended June 30, 1996 as
compared to 1995. This variance was primarily the result of an increase at the
Summer Creek Villas property of $17,000 due to an increase in rental rates and a
$17,000 increase at Hubbard's Ridge due to increased occupancy. Additionally,
rental income increased $9,000 at Cutler Canal II due to increased rental rates
offset by a decrease at Diamond Street of $9,000 due to decreased occupancies.
Other income (consisting primarily of application fees and forfeited security
deposits) decreased $50,000 for the three months ended June 30, 1996 as compared
to 1995. Other income decreased $41,000 and $7,000, respectively, at Summer
Creek Villas and Hubbard's Ridge, as a result of lower collections of forfeited
security deposits.
6
<PAGE>
<PAGE>
Operating and other expenses increased $19,000 for the three months ended
June 30, 1996 as compared to 1995 mainly due to increases in utilities expense
at Cutler Canal II and Brookland Park Plaza of $7,000 and $5,000, respectively,
and $9,000 at Hill Top Homes due to increased management salaries and cable
costs.
Repairs and maintenance increased $83,000 for the three months ended June 30,
1996 as compared to 1995 mainly due to increases of $36,000, $22,000 and
$12,000, respectively, at Hubbard's Ridge, Summer Creek Villas and Hill Top
Homes. The increase at Hubbard's Ridge was due to damage caused by wind storms
which will be partially recovered through future insurance proceeds; at Summer
Creek Villas due to increased carpet replacement costs; and at Hill Top Homes
due to increased grounds maintenance and carpet replacement costs.
Property Information
Occupancies at the Local Partnerships were as follows:
<TABLE>
<CAPTION>
March 31,
---------------
Property 1996 1995
<S> <C> <C>
- --------------------------------------------------------------
Hubbard's Ridge 93% 85%
Cutler Canal II 94 97
Diamond Street 83 96
Papillion Heights 100 100
Hill Top Homes 96 94
Summer Creek Villas 90 95
Brookland Park Plaza 100 100
Compton Townhouses 95 100
</TABLE>
(Occupancies are calculated by dividing occupied units by total available
units.)
The Partnership holds a 66.5% interest in Summer Creek Villas, a 98% interest
in Hubbard's Ridge, Hill Top Homes and Compton Townhouses and a 98.99% interest
in Cutler Canal II, Diamond Street, Papillion Heights and Brookland Park Plaza.
There have been no significant changes in occupancies at the above properties as
of August 4, 1996, except for an increase at Diamond Street to 92% and a
decrease at Cutler Canal II to 85%.
* * * *
7
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings--None
Item 2. Changes in Securities--None
Item 3. Defaults Upon Senior Securities--None
Item 4. Submission of Matters to a Vote of Security Holders--None
Item 5. Other Information--None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Description:
Agreement of Limited Partnership as adopted on May 3, 1989 and
Amendments thereto dated May 25, 1989 and June 21, 1989*
Form of Amended and Restated Agreement of Limited Partnership
(included in Prospectus as Exhibit A)**
Form of Purchase and Sale Agreement pertaining to the
Partnership's Acquisition of Local Partnership Interests.**
Form of Amended and Restated Agreement of Local Limited
Partnership of Local Partnerships.**
(b) Reports on Form 8-K--None
------------
* Filed as an exhibit to Pre-Effective Amendment No. 1 to Form S-11
Registration Statement (No. 33-28571) (the ``Registration Statement'')
and incorporated herein by reference.
** Filed as an exhibit to Pre-Effective Amendment No. 2 to Form S-11
Registration Statement and incorporated herein by reference.
8
<PAGE>
<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.
Prudential-Bache Tax Credit Properties L.P.
By: Prudential-Bache Properties, Inc.
A Delaware corporation, General Partner
By: /s/ Eugene D. Burak Date: August 14, 1996
----------------------------------------
Eugene D. Burak
Vice President
Chief Accounting Officer for the Registrant
9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial
information extracted from the financial
statements for P-B Tax Credit Properties, L.P.
and is qualified in its entirety by reference
to such financial statements
</LEGEND>
<RESTATED>
<CIK> 0000850184
<NAME> P-B Tax Credit Properties, L.P.
<MULTIPLIER> 1
<FISCAL-YEAR-END> Mar-31-1997
<PERIOD-START> Apr-1-1996
<PERIOD-END> Jun-30-1996
<PERIOD-TYPE> 3-Mos
<CASH> 2,036,300
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 5,676,320
<PP&E> 78,589,191
<DEPRECIATION> (11,618,722)
<TOTAL-ASSETS> 72,646,789
<CURRENT-LIABILITIES> 53,404,020
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 72,646,789
<SALES> 0
<TOTAL-REVENUES> 2,285,780
<CGS> 0
<TOTAL-COSTS> 3,028,218
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,072,456
<INCOME-PRETAX> (621,411)
<INCOME-TAX> (621,411)
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (621,411)
<EPS-PRIMARY> (16.14)
<EPS-DILUTED> 0
</TABLE>
