November 14 , 2000
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: Boston Financial Qualified Housing Tax Credits L.P. V
Report on Form 10-Q for the Quarter Ended September 30, 2000
File Number 0-19706
Dear Sir/Madam:
Pursuant to the requirements of Section 15(d) of the Securities Exchange Act of
1934, there is filed herewith one copy of the subject report.
Very truly yours,
/s/Stephen Guilmette
Stephen Guilmette
Assistant Controller
QH5-Q2.DOC
<PAGE>
UNITED STATES
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 September 30, 2000
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 0-19706
Boston Financial Qualified Housing Tax Credits L.P. V
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(Exact name of registrant as specified in its charter)
Massachusetts 04-3054464
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
101 Arch Street, Boston, MA 02110-1106
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 439-3911
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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 .
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BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION Page No.
------------------------------ -------
Item 1. Financial Statements
Balance Sheets - September 30, 2000 (Unaudited) and
March 31, 2000 1
Statements of Operations (Unaudited) - For the Three and Six
Months Ended September 30, 2000 and 1999 2
Statement of Changes in Partners' Equity (Deficiency)
(Unaudited) - For the Six Months Ended September 30, 2000 3
Statements of Cash Flows (Unaudited) - For the Six
Months Ended September 30, 2000 and 1999 4
Notes to the Financial Statements (Unaudited) 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II - OTHER INFORMATION
Items 1-6 9
SIGNATURE 10
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, March 31,
2000 2000
------------- -------------
(Unaudited)
Assets
<S> <C> <C>
Cash and cash equivalents $ 416,815 $ 392,154
Restricted cash 135,145 131,198
Investments in Local Limited Partnerships, net (Note 1) 17,660,093 18,818,290
Marketable securities, at fair value 2,659,506 2,332,268
Other assets 34,714 29,074
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Total Assets $ 20,906,273 $ 21,702,984
============= =============
Liabilities and Partners' Equity
Accounts payable to affiliates $ 199,012 $ 121,184
Accounts payable and accrued expenses 40,680 43,605
Deferred revenue 135,145 131,198
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Total Liabilities 374,837 295,987
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General, Initial and Investor Limited Partners' Equity 20,547,137 21,443,142
Net unrealized losses on marketable securities (15,701) (36,145)
------------- -------------
Total Partners' Equity 20,531,436 21,406,997
------------- -------------
Total Liabilities and Partners' Equity $ 20,906,273 $ 21,702,984
============= =============
</TABLE>
The accompanying notes are an integral part of these
financial statements
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
STATEMENTS OF OPERATIONS
For the Three and Six Months Ended September 30, 2000 and 1999
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
September 30, September 30,
September 30, 1999 September 30, 1999
2000 (Restated) 2000 (Restated)
------------- ------------- ------------- -------------
Revenue:
<S> <C> <C> <C> <C>
Investment $ 44,250 $ 37,804 $ 86,737 $ 78,541
Other 32,309 23,778 148,438 43,387
------------- ------------- ------------- -------------
Total Revenue 76,559 61,582 235,175 121,928
------------- ------------- ------------- -------------
Expenses:
General and administrative
(includes reimbursements
to an affiliate in the amounts
of $77,828 and $52,382 in 2000
and 1999, respectively) 59,917 127,226 127,176 194,575
Asset management fees,
related party 62,841 61,496 125,682 122,997
Provision for valuation of
investment in Local
Limited Partnership - 174,739 - 174,739
Amortization 5,899 5,969 11,798 11,934
------------- ------------- ------------- -------------
Total Expenses 128,657 369,430 264,656 504,245
------------- ------------- ------------- -------------
Loss before equity in losses of
Local Limited Partnerships (52,098) (307,848) (29,481) (382,317)
Equity in losses of Local
Limited Partnerships (Note 1) (416,592) (373,001) (866,524) (1,026,759)
------------- ------------- ------------- -------------
Net Loss $ (468,690) $ (680,849) $ (896,005) $ (1,409,076)
============= ============= ============= =============
Net Loss allocated:
To General Partners $ (4,687) $ (6,809) $ (8,960) $ (14,091)
To Limited Partners (464,003) (674,040) (887,045) (1,394,985)
------------- ------------- ------------- -------------
$ (468,690) $ (680,849) $ (896,005) $ (1,409,076)
============= ============= ============= =============
Net Loss per Limited Partnership
Unit (68,929 Units) $ (6.73) $ (9.78) $ (12.87) $ (20.24)
============= ============= ============= =============
</TABLE>
The accompanying notes are an integral part of these
financial statements
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIENCY)
For the Six Months Ended September 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
Initial Investor Net
General Limited Limited Unrealized
Partners Partner Partners Losses Total
<S> <C> <C> <C> <C> <C>
Balance at March 31, 2000 $ (377,675) $ 5,000 $ 21,815,817 $ (36,145) $ 21,406,997
----------- --------- -------------- ----------- -------------
Comprehensive Income (Loss):
Change in net unrealized
losses on marketable securities
available for sale - - - 20,444 20,444
Net Loss (8,960) - (887,045) - (896,005)
----------- --------- -------------- ----------- -------------
Comprehensive Income (Loss) (8,960) - (887,045) 20,444 (875,561)
----------- --------- -------------- ----------- -------------
Balance at September 30, 2000 $ (386,635) $ 5,000 $ 20,928,772 $ (15,701) $ 20,531,436
=========== ========= ============== =========== =============
</TABLE>
The accompanying notes are an integral part of these
financial statements
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
For the Six Months Ended September 30, 2000 and 1999
(Unaudited)
<TABLE>
<CAPTION>
1999
2000 (Restated)
--------- -----------
<S> <C> <C>
Net cash provided by (used for) operating activities $ 19,180 $ (404,493)
--------- -----------
Cash flows from investing activities:
Purchases of marketable securities (827,387) (768,983)
Proceeds from sales and maturities of marketable securities 522,783 835,665
Cash distributions received from Local
Limited Partnerships 310,085 191,107
Advance to Local Limited Partnership - (180,000)
Repayment of advance to Local Limited Partnership - 180,000
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Net cash provided by investing activities 5,481 257,789
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Net increase (decrease) in cash and cash equivalents 24,661 (146,704)
Cash and cash equivalents, beginning 392,154 303,666
--------- -----------
Cash and cash equivalents, ending $ 416,815 $ 156,962
========= ===========
</TABLE>
The accompanying notes are an integral part of these
financial statements
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
Notes to the Financial Statements
(Unaudited)
The unaudited financial statements presented herein have been prepared in
accordance with the instructions to Form 10-Q and do not include all of the
information and note disclosures required by generally accepted accounting
principles. These statements should be read in conjunction with the financial
statements and notes thereto included with the Partnership's Form 10-K for the
year ended March 31, 2000. In the opinion of management, these financial
statements include all adjustments, consisting only of normal recurring
adjustments, necessary to present fairly the Partnership's financial position
and results of operations. The results of operations for the periods may not be
indicative of the results to be expected for the year. Certain reclassifications
have been made to prior year's financial statements to conform to the current
year presentation.
The General Partners have elected to report results of the Local Limited
Partnerships on a 90 day lag basis, because the Local Limited Partnerships
report their results on a calendar year basis. Accordingly, the financial
information of the Local Limited Partnerships included in the accompanying
financial statements is as of June 30, 2000 and 1999.
1. Investments in Local Limited Partnerships
The Partnership uses the equity method to account for its limited partner
interest in twenty-six Local Limited Partnerships. Each of these Local Limited
Partnerships owns and operates multi-family housing complexes, most of which are
government-assisted. The Partnership, as Investor Limited Partner pursuant to
the various Local Limited Partnership Agreements which contain certain operating
and distribution restrictions, has generally acquired a 99% interest in the
profits, losses, tax credits and cash flows from operations of each of the Local
Limited Partnerships, with the exception of Strathern Park/Lorne Park
Apartments, Westgate and Huguenot Park, which are 95%, 49.5% and 88.55%,
respectively. Upon dissolution, proceeds will be distributed according to each
respective partnership agreement.
The following is a summary of Investments in Local Limited Partnerships at
September 30, 2000:
Capital contributions and advances paid to Local Limited Partnerships and
purchase price paid to withdrawing partners of Local Limited
Partnerships $ 55,571,437
Cumulative equity in losses of Local Limited
Partnerships (excluding cumulative unrecognized
losses of $3,193,625) (36,011,543)
Cumulative cash distributions received
from Local Limited Partnerships (1,904,408)
---------------
Investments in Local Limited Partnerships
before adjustment 17,655,486
Excess of investment cost over the underlying net assets acquired:
Acquisition fees and expenses 1,006,357
Accumulated amortization of acquisition
fees and expenses (237,814)
---------------
Investments in Local Limited Partnerships
before reserve for valuation 18,424,029
Reserve for valuation of investment in Local
Limited Partnership (763,936)
---------------
Investments in Local Limited Partneship $ 17,660,093
===============
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
Notes to the Financial Statements (Continued)
(Unaudited)
1. Investments in Local Limited Partnerships (continued)
----------------------------------------------------
The Partnership's share of net losses of the Local Limited Partnerships for the
six months ended September 30, 2000 is $1,463,297. For the six months ended
September 30, 2000, the Partnership has not recognized $596,773 of equity in
losses relating to several Local Limited Partnerships where cumulative equity in
losses and cumulative distributions from Local Limited Partnerships exceeded its
total investments in these Local Limited Partnerships.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Certain matters discussed herein constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The
Partnership intends such forward-looking statements to be covered by the safe
harbor provisions for forward-looking statements and is including this statement
for purposes of complying with these safe harbor provisions. Although the
Partnership believes the forward-looking statements are based on reasonable
assumptions, the Partnership can give no assurance that their expectations will
be attained. Actual results and timing of certain events could differ materially
from those projected in or contemplated by the forward-looking statements due to
a number of factors, including, without limitation, general economic and real
estate conditions and interest rates.
Liquidity and Capital Resources
At September 30, 2000, the Partnership had cash and cash equivalents of
$416,815, compared with $392,154 at March 31, 2000. The increase is attributable
to cash provided by operating activities and cash distributions received from
Local Limited Partnerships, partially offset by purchases of marketable
securities in excess of proceeds from sales and maturities of marketable
securities.
Approximately $2,292,000 of marketable securities has been designated as
Reserves by the Managing General Partner. The Reserves were established to be
used for working capital of the Partnership and contingencies related to the
ownership of Local Limited Partnership interests. Management believes that the
investment income earned on the Reserves, along with cash distributions received
from Local Limited Partnerships, to the extent available, will be sufficient to
fund the Partnership's ongoing operations and any contingencies that may arise.
Reserves may be used to fund Partnership operating deficits, if the Managing
General Partner deems funding appropriate.
In the event a Local Limited Partnership encounters operating difficulties
requiring additional funds, the Partnership might deem it in its best interests
to provide such funds, voluntarily, in order to protect its investment. To date,
the Partnership has advanced approximately $303,000 to Local Limited
Partnerships to fund operating deficits.
Since the Partnership invests as a limited partner, the Partnership has no
contractual duty to provide additional funds to Local Limited Partnerships
beyond its specified investment. Thus, at September 30, 2000, the Partnership
had no contractual or other obligation to any Local Limited Partnership, which
had not been paid or provided for.
Cash Distributions
No cash distributions were made during the six months ended September 30, 2000.
Results of Operations
The Partnership's results of operations for the three and six months ended
September 30, 2000 resulted in a net loss of $468,690 and $896,005,
respectively, as compared to a net loss of $680,849 and $1,409,076 for the same
periods in 1999. The decrease in net loss is primarily attributable to a
valuation provision recorded in 1999 related to the Partnership's investment in
a Local Limited Partnership, as well as decreases in equity in losses of Local
Limited Partnerships and general and administrative expenses from 1999 to 2000.
Equity in losses of Local Limited Partnerships decreased primarily due to an
increase in unrecognized losses for Local Limited Partnerships whose carrying
values have been reduced to zero. General and administrative expenses decreased
due to a decrease in legal expenses between 1999 and 2000. In addition, other
revenue increased in 2000 as a result of a refund of legal costs related to one
Local Limited Partnership.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
Property Discussions
Historic New Center in Detroit, Michigan operated at a deficit during the first
nine months of 2000 due to low occupancy and collection problems. Occupancy
dropped to 72% at September 30, 2000, as a result of site management efforts to
improve the tenant profile through a tighter tenant screening process, a lack of
qualified applicants and the property's poor curb appeal. Management is working
to increase curb appeal and implement new marketing programs to increase
qualified tenant traffic. The Managing General Partner continues to closely
monitor the site managers efforts to improve property operations.
As previously reported regarding Westgate (Bismarck, North Dakota), in order to
protect the remaining tax credits generated by the property, the Managing
General Partner consummated the transfer of 50% of the Partnership's capital and
profits in the property to an affiliate of the Local General Partner in November
1997. The Managing General Partner also has the right to transfer the
Partnership's remaining interest to the Local General Partner any time after one
year from the initial transfer. Subsequently, the Local General Partner
transferred both its general partner interest and 48.5% of the local partnership
interest in Westgate to a non-profit general partner effective June 17, 1999. As
a result, the date when the Managing General Partner has the right to transfer
the Partnership's remaining interest to the new Local General Partner was
amended to reflect the June 17, 1999 effective date. Further, the new Local
General Partner has the right to call the remaining interest after the tax
credit period has expired in 2001. As of September 30, 2000, occupancy at
Westgate was 93% and the property operated slightly above break-even.
As previously reported on Wheeler House, debt-restructuring negotiations with
the lender ended unsuccessfully in the beginning of November 1999. Consequently,
the lender foreclosed on the property in early January 2000. The foreclosure
will result in recapture of credits of approximately $3.70 per unit which will
be on your 2000 Schedule K-1 that will be filed in April of 2001. In addition,
the foreclosure will result in the allocation of taxable income to the
Partnership and loss of future benefits associated with this property.
The Partnership has implemented policies and practices for assessing potential
impairment of its investments in Local Limited Partnerships. The investments are
analyzed by real estate experts to determine if impairment indicators exist. If
so, the carrying value is compared to the undiscounted future cash flows
expected to be derived from the asset. If there is a significant impairment in
carrying value, a provision to write down the asset to fair value will be
recorded in the Partnership's financial statements.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
PART II OTHER INFORMATION
Items 1-5 Not applicable
Item 6 Exhibits and reports on Form 8-K
(a) Exhibits - None
(b) Reports on Form 8-K - No reports on Form 8-K were filed
during the quarter ended September 30, 2000.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING TAX CREDITS L.P. V
(A Limited Partnership)
SIGNATURE
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.
DATED: November 14, 2000 BOSTON FINANCIAL QUALIFIED HOUSING
TAX CREDITS L.P. V
By: Arch Street V, Inc.,
its Managing General Partner
/s/Randolph G. Hawthorne
--------------------------------------------
Randolph G. Hawthorne
Managing Director, Vice President and
Chief Operating Officer
<PAGE>
