<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For the quarterly period ended September 30, 1999
Commission File Number 33-28493-A
CONDEV LAND FUND III, LTD.
--------------------------
(Exact name of registrant as specified in its charter)
FLORIDA 59-2943405
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(State or other jurisdiction of (I.R.S. Employer
incorporation of organization) Identification No.)
2479 Aloma Avenue
Winter Park, Florida 32792
(Address of principal executive offices)
Registrant's telephone number, including area code: (407) 679-1748
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 report), and (2) has been subject to such filing
requirements for the past 90 days. YES X NO ______.
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CONDEV LAND FUND III, LTD.
INDEX
PAGE
NUMBER
PART I. FINANCIAL INFORMATION:
Statement of Assets, Liabilities and
Partner's Capital - September 30, 1999
and December 31, 1998 1
Statement of Income & Expense -
Three Months Ended September 30, 1999
and September 30, 1998 2
Statement of Income & Expense -
Nine Months Ended September 30, 1999
and September 30, 1998 3
Statement of Cash Flows -
Nine months ended September 30, 1999
and September 30, 1998 4
Notes to Financial Statements 5 - 6
Management's Discussion and Analysis of
Financial Condition and Results of Operations 7 - 8
PART II. OTHER INFORMATION:
Item 1. Legal Proceedings 8
Item 6. Exhibits and Reports on Form 8-K 8
Signatures 9
Third Quarter 1999 Report to Limited Partners 10
<PAGE>
PART I. FINANCIAL INFORMATION
CONDEV LAND FUND III, LTD.
STATEMENT OF ASSETS, LIABILITIES AND PARTNERS' CAPITAL
SEPTEMBER 30, 1999 AND DECEMBER 31, 1998
ASSETS
------
September 30, 1999 December 31, 1998
------------------- -----------------
(Unaudited) *
Cash and Cash Equivalents $ 63,393 $ 67,118
Accounts Receivable - -
Investment in Joint Venture (2) - 533,596
Land, at cost (3) 455,846 405,625
Organization Costs 2,311 2,311
-------- ----------
Total Assets: $521,550 $1,008,650
======== ==========
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
Liabilities
Accounts Payable $ 48,572 $ -
-------- ----------
Partner's Capital:
General Partner ($ 874) ($ 996)
Limited Partners 473,852 1,009,646
-------- ----------
Total Partners' Capital: $472,978 $1,008,650
-------- ----------
Total Liabilities and Partners'
Capital: $521,550 $1,008,650
======== ==========
* Condensed from audited financial statements.
The accompanying notes are an integral part of these financial statements
1
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CONDEV LAND FUND III, LTD.
STATEMENT OF INCOME AND EXPENSE
THREE MONTHS ENDED SEPTEMBER 30, 1999 AND SEPTEMBER 30, 1998
(UNAUDITED)
September 30, 1999 September 30, 1998
------------------ ------------------
INCOME
------
Interest and Other Income $2,398 $ 960
Equity in Income of Joint Venture - -
------ ---------
Total Income $2,398 $ 960
------ ---------
OPERATING EXPENSES
------------------
Professional fees - -
Equity in loss of Joint Venture - 225
Management fees 936 936
Other expense - 526
Office expense 609 982
------ ---------
Total Operating Expenses: $1,545 $ 2,669
------ ---------
Net Profit (Loss) $ 853 ($ 1,709)
====== =========
The accompanying notes are an integral part of these financial statements
2
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CONDEV LAND FUND III, LTD.
STATEMENT OF INCOME AND EXPENSE
NINE MONTHS ENDED SEPTEMBER 30, 1999 AND SEPTEMBER 30, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
September 30, 1999 September 30, 1998
------------------ ------------------
<S> <C> <C>
INCOME
------
Interest and Other Income $ 3,675 $ 4,618
Equity in Income of Joint Venture 20,993 -
-------- ---------
Total Income $ 24,668 $ 4,618
-------- ---------
OPERATING EXPENSES
------------------
Professional fees 7,000 7,100
Equity in loss of Joint Venture - 2,542
Management fees 2,808 2,808
Other expense 250 569
Office expense 2,378 2,854
-------- ---------
Total Operating Expenses: $ 12,346 $ 15,873
-------- ---------
Net Profit (Loss) $ 12,232 ($ 11,255)
======== =========
</TABLE>
The accompanying notes are an integral part of these financial statements
3
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CONDEV LAND FUND III, LTD.
STATEMENT OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 1999 AND SEPTEMBER 30, 1998
<TABLE>
<CAPTION>
September 30, 1999 September 30, 1998
------------------ ------------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net Income (Loss) $ 12,232 ($ 11,255)
Adjustments to reconcile net income
(loss) to net cash provided by (used
in) operating activities:
Equity in (income) loss of
joint venture ( 20,993) 2,542
Cash provided by changes in:
Accounts receivable - 2,494
Accounts payable 48,571 ( 487)
--------- ---------
Net Cash Provided in Operating Activities: $ 39,810 ($ 6,706)
Cash Flows from Investing Activities:
Capitalized land related costs ($ 50,220) $ -
Investments in joint venture 554,589 -
--------- ---------
Net Cash Used in Investing Activities: $ 504,369 $ -
--------- ---------
Cash Flows from Financing Activities:
Distributions to Partners ($ 547,904) ($ -)
--------- ---------
Net Cash Provided by Financing Activities: ($ 547,904) ($ -)
---------- ---------
Net increase (decrease) in Cash ($ 3,725) ($ 6,706)
Cash and cash equivalents, beginning of year 67,118 90,357
--------- ---------
Cash and cash equivalents, end of period $ 63,393 $ 83,651
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements
4
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CONDEV LAND FUND III, LTD.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Note 1 BASIS OF PRESENTATION.
---------------------
The accompanying financial statements, in the opinion of Condev
Associates, the general partner of Condev Land Fund III, Ltd.,
reflect all adjustments (which include only normal recurring
adjustments) necessary to a fair statement of the financial position,
the results of operations and the changes in cash position for the
periods presented.
Note 2 INVESTMENT IN JOINT VENTURE:
---------------------------
Until the sale of Condev Osceola Joint Venture's last parcel of land,
the partnership owned a 90% interest in Condev Osceola Joint Venture.
On April 23, 1999, Condev Osceola Joint Venture concluded the sale of
its 2.94 acre tract of land in the Kyng's Heath subdivision on SR 535
and US Hwy 192 in Osceola County, Florida. The buyer was Sierra Land
Company, and the purchase price was $700,000. After expenses of the
sale, which included legal fees, closing costs and a 10% real estate
commission paid to non-affiliated real estate brokers, the Joint
Venture realized net proceeds of $617,039.74. The Joint Venture has
distributed a total of $606,000 of the net proceeds to the Joint
Venture partners, including $545,400 to Condev Land Fund III, Ltd. and
$60,600 to Condev Osceola, Ltd. In turn, the Partnership distributed a
total of $547,904, or $56 per unit to limited partners. Since this was
the last parcel of land owned by Condev Osceola Joint Venture, the
Joint Venture was terminated.
Note 3 INVESTMENT IN LAND:
-------------------
At September 30, 1999 and December 31, 1998, land consisted of a ten-
acre parcel, zoned commercial in Lake County, Florida. As part of the
Partnership's commitment to design and construct an entry road from US
Hwy 27 to service the property, approximately 0.354 acres of land was
used for construction of the spine road. This road was dedicated to
Lake County on December 29, 1998, reducing the property size to 9.646
acres. On March 8, 1999, the Partnership entered into a contract for
sale of this parcel with the neighboring property owner. This
transaction was closed on October 7, 1999. The sale price was $762,500
plus interest from the originally scheduled closing date of July 15,
1999 in the amount of $17,547.95, for a total of $780,047.95. After
expenses of the sale, which included $76,250 in real estate
commissions paid to non-affiliated real estate brokers, the net
proceeds realized by the Partnership were $685,235.17. The Partnership
paid $400,000 for this parcel in 1993.
Note 4 DISTRIBUTIONS TO PARTNERS:
--------------------------
Pursuant to the partnership agreement, cash flow generated each year
by the Partnership is to be distributed 99% to the
5
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limited partners and 1% to the general partner. There were no
cash flow distributions during the first nine months of 1999.
Pursuant to the partnership agreement, proceeds realized from the
sale of properties, after the establishment of reserves for
future operating costs, are to be distributed at least annually.
In April, a total of $547,904 was distributed to limited
partners. See note 2. Investment in Joint Venture.
---------------------------
Note 5a RELATED PARTY TRANSACTIONS:
---------------------------
The Partnership Agreement provides for the reimbursement to the
general partner of administrative expenses incurred in the direct
operation of the partnership. For the nine months ended September
30, 1999, a total of $3,443 was reimbursed to the general partner
for direct expenses incurred.
When properties are sold, an affiliate of the general partner may
be paid real estate commissions in amounts customarily charged by
others rendering similar services with such commissions plus
commissions paid to nonaffiliated brokers not to exceed 10% of
the gross sales price. No real estate commissions were paid to
the general partner or any affiliate during the nine months ended
September 30, 1999.
The general partner is obligated to loan up to $100,000 to the
Partnership during its term to meet working capital requirements.
No such loans were made to the Partnership during the nine months
ended September 30, 1999.
6
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS
-------------------------
During the nine months ended September 30, 1999, the Partnership
continued to manage the portfolio properties with the objective
of selling the properties at fair market prices. As discussed in
Note 2 above, Condev Osceola Joint Venture was terminated after
its only remaining property was sold and the net proceeds were
distributed to limited partners. As discussed in Note 3 above,
the Partnership was successful in working out a satisfactory
solution for sale of its remaining property. The transaction was
closed in October, 1999. See note 3. Investment in land. Since
------------------
this is the last property owned by the Partnership, all accounts
are being reviewed by the Partnership's auditors. A final
distribution totaling $677,248 was made in October, 1999, and the
partnership is being terminated.
Year 2000
---------
The Partnership is heavily dependent upon a computer system to
accurately maintain limited partner records, including name and
address information, number of units owned, and distribution
historical records. The Partnership is utilizing a system which
was specially designed for the Partnership in 1990, and it is
possible that the system will be affected by the date change
which will occur at the end of 1999. The Partnership engaged a
computer consultant to evaluate the potential problems, and make
system changes if necessary so the operation of the Partnership
will not be affected by the date change. Completion of revisions
to the system is was completed in June, 1999. The cost of
evaluating the current system and bringing it up to date to be
year 2000 compliant was less than $1,000. The Partnership's
computer records are backed up on a weekly basis, so all of the
stored information is available from a secondary source. Even if
the system were to be completely shut down by the date change at
the end of 1999, the data necessary to continue operation of the
Partnership is available and could readily be adapted to a new
system which is year 2000 compliant, so no significant
interruption in the operations of the Partnership is anticipated.
Results of Operations
---------------------
Total revenues for the nine months ended September 30, 1999 were
$24,668, compared with total revenues of $4,618 for the nine
months ended September 30, 1998. The 1999 period included equity
in the income of Joint Venture in the amount of $20,993. See
Joint Venture below. Other income is generated from short-term
-------------
cash investments, and income can be expected to fluctuate,
depending on the level of cash reserves in the Partnership and
prevailing interest rates. Operating expenses for the nine months
ended September 30, 1999 were $12,436, a essentially unchanged
from $13,331 for the nine months ended September 30 31, 1998. In
both periods, operating expenses represent the normal costs of
7
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operating the Partnership and managing the Partnership
properties.
Joint Venture. For the nine months ended September 30, 1999,
-------------
Condev Osceola Joint Venture had one sale of land in the amount
of $700,000, and reported a net profit of $23,325. Having sold
its only remaining land, the Joint Venture distributed all of its
cash to the joint venture partners and was terminated.
Liquidity and Capital Resources
-------------------------------
Total assets decreased from $1,008,650 at December 31, 1998 to
$521,550 at September 30, 1999. This reflects the sale of
property and liquidation of Condev Osceola Joint Venture and the
net results of operations for the period. Assets can be expected
to decline in the future as properties are sold and distributions
are made to limited partners. As discussed in note 3. Investment
----------
in Land, the last property owned by the partnership was sold in
-------
October, 1999. All liabilities have been paid and all available
cash in the Partnership was distributed to limited partners in
October.
PART II
Item 1. LEGAL PROCEEDINGS:
-----------------
As of September 30, 1999, there were no legal proceedings in
process, nor to the knowledge of the general partner, threatened
against the Partnership
Item 6. EXHIBITS AND REPORTS ON FORM 8-K:
---------------------------------
(A) Exhibits
Third Quarter 1999 Report to Limited Partners
(B) Reports on Form 8-K
There were no reports of Form 8-K for the period ended September
30, 1999.
8
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CONDEV LAND FUND III, LTD.
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.
CONDEV LAND FUND III, LTD.
BY: Condev Associates, General Partner
October 26, 1999 /s/ Robert N. Gardner
- ------------------------ ---------------------------------
DATE Robert N. Gardner, Partner
October 26, 1999 /s/ Joseph J. Gardner
- ------------------------ ---------------------------------
DATE Joseph J. Gardner, Partner
9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<CURRENCY> 1.00
<S> <C> <C>
<PERIOD-TYPE> 9-MOS 9-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1998
<PERIOD-START> JAN-01-1999 JAN-01-1998
<PERIOD-END> SEP-30-1999 SEP-30-1998
<EXCHANGE-RATE> 1.00 1.00
<CASH> 63,393 90,357
<SECURITIES> 0 0
<RECEIVABLES> 0 2,494
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 455,846 405,467
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 521,550 1,023,259
<CURRENT-LIABILITIES> 48,572 0
<BONDS> 0 0
0 0
0 0
<COMMON> 0 0
<OTHER-SE> 472,978 1,023,259
<TOTAL-LIABILITY-AND-EQUITY> 521,550 1,023,259
<SALES> 0 0
<TOTAL-REVENUES> 24,668 4,618
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 12,346 15,873
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 12,232 (11,255)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 12,232 (11,255)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 12,232 (11,255)
<EPS-BASIC> 0 0
<EPS-DILUTED> 0 0
</TABLE>
<PAGE>
October 22, 1999
Condev Land Fund III, Ltd.
Third Quarter 1999
We are pleased to report that the last property owned by this partnership was
sold on October 7, 1999. The sale price was $762,500 plus interest from the
originally scheduled closing date of July 15, 1999 in the amount of $17,547.95,
for a total of $780,047.95. After expenses of the sale, which included $76,250
in real estate commissions paid to non-affiliated real estate brokers, the net
proceeds realized by the Partnership were $685,235.17. The Partnership paid
$400,000 for this parcel in 1993.
Enclosed is a check representing your pro rata share of the net proceeds
realized from this sale plus the remaining cash in the Partnership after
deducting the estimated amount necessary for accounting, legal and
administrative costs to wind up the affairs of the Partnership. If your
-------
investment is held by a custodian, enclosed is a copy of the distribution check
- -------------------------------------------------------------------------------
which was sent to the custodian.
- --------------------------------
Since this is the final property in the Partnership, the accountants are
reviewing all accounts in preparation for termination of the Partnership. You
will be receiving a final K-1 (Form 1065) in February, 2000.
The financial statements of the Partnership for the first three quarters of 1999
are on the reverse side hereof. As of September 30, 1999,(which was prior to the
sale discussed above)the net asset value (book value) per unit of limited
partner interest was $48.43.
Please feel free to contact the Investor Relations office if you have any
questions or would like additional information concerning your investment.
Sincerely yours,
CONDEV ASSOCIATES
