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Previous: PUTNAM NEW OPPORTUNITIES FUND, 497J, 1997-11-05 |
Next: CITYSCAPE FINANCIAL CORP, 424B3, 1997-11-05 |
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, 1997
-------------------------------------------------
[_] 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 0-20151
Commission file number 33-35868-01
PARTICIPATING INCOME PROPERTIES III LIMITED PARTNERSHIP
and
FFCA/PIP III INVESTOR SERVICES CORPORATION
- --------------------------------------------------------------------------------
(Exact Name of Co-Registrants as Specified in Their
Organizational Documents)
Delaware 86-0665681
- --------------------------------------------------------------------------------
(Partnership State of Organization) (Partnership I.R.S. Employer
Identification Number)
Delaware 86-0555605
- --------------------------------------------------------------------------------
(Corporation State of Incorporation) (Corporation I.R.S. Employer
Identification Number)
The Perimeter Center
17207 North Perimeter Drive
Scottsdale, Arizona 85255
- --------------------------------------------------------------------------------
(Address of principal executive offices) (zip code)
Co-Registrants' telephone number including area code (602) 585-4500
---------------------------
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>
PART 1 - FINANCIAL INFORMATION
Item l. Financial Statements.
------- ---------------------
PARTICIPATING INCOME PROPERTIES III LIMITED PARTNERSHIP
BALANCE SHEETS
SEPTEMBER 30, 1997 AND DECEMBER 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
September 30, December 31,
1997 1996
------------ ------------
ASSETS
------
<S> <C> <C>
CASH AND CASH EQUIVALENTS $ 626,301 $ 651,261
RECEIVABLES FROM LESSEES 50,000 38,000
MORTGAGE LOAN INTEREST RECEIVABLE 45,208 45,208
MORTGAGE LOAN RECEIVABLE 7,750,000 7,750,000
PROPERTY SUBJECT TO OPERATING LEASES, at cost
Land 2,684,138 2,684,138
Buildings 11,010,862 11,010,862
Equipment 947,838 947,838
------------ ------------
Total 14,642,838 14,642,838
Less-Accumulated depreciation 2,384,642 2,048,841
------------ ------------
12,258,196 12,593,997
------------ ------------
Total assets $ 20,729,705 $ 21,078,466
============ ============
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
DISTRIBUTION PAYABLE TO LIMITED PARTNERS $ 579,491 $ 579,450
PAYABLE TO GENERAL PARTNER -- 7,720
RENTAL DEPOSITS AND OTHER 250,223 255,504
------------ ------------
Total liabilities 829,714 842,674
------------ ------------
PARTNERS' CAPITAL (DEFICIT):
General partner (20,568) (17,210)
Limited partners 19,920,559 20,253,002
------------ ------------
Total partners' capital 19,899,991 20,235,792
------------ ------------
Total liabilities and partners' capital $ 20,729,705 $ 21,078,466
============ ============
</TABLE>
<PAGE>
PARTICIPATING INCOME PROPERTIES III LIMITED PARTNERSHIP
STATEMENTS OF INCOME
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
Three Months Three Months Nine Months Nine Months
Ended Ended Ended Ended
9/30/97 9/30/96 9/30/97 9/30/96
------------ ------------ ----------- -----------
<S> <C> <C> <C> <C>
REVENUES:
Rental $ 394,870 $ 394,870 $1,184,610 $1,184,610
Participating rentals 153,436 124,377 401,758 380,590
Mortgage loan interest 135,625 135,625 406,875 406,875
Interest and other 5,524 5,351 16,867 16,688
---------- ---------- ---------- ----------
689,455 660,223 2,010,110 1,988,763
---------- ---------- ---------- ----------
EXPENSES:
General partner fees 83,110 52,500 185,627 167,668
Depreciation 111,934 111,934 335,801 337,274
Operating 21,073 22,446 68,663 65,259
---------- ---------- ---------- ----------
216,117 186,880 590,091 570,201
---------- ---------- ---------- ----------
NET INCOME $ 473,338 $ 473,343 $1,420,019 $1,418,562
========== ========== ========== ==========
NET INCOME ALLOCATED TO:
General partner $ 4,733 $ 4,733 $ 14,200 $ 14,186
Limited partners 468,605 468,610 1,405,819 1,404,376
---------- ---------- ---------- ----------
$ 473,338 $ 473,343 $1,420,019 $1,418,562
========== ========== ========== ==========
NET INCOME PER LIMITED
PARTNERSHIP UNIT (based on
26,709 units held by limited partners) $ 17.54 $ 17.55 $ 52.63 $ 52.58
========== ========== ========== ==========
</TABLE>
<PAGE>
PARTICIPATING INCOME PROPERTIES III LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997
(Unaudited)
<TABLE>
<CAPTION>
Limited Partners
General ------------------------------
Partner Number Total
Amount of Units Amount Amount
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
BALANCE, December 31, 1996 $ (17,210) 26,709 $ 20,253,002 $ 20,235,792
Net income 14,200 -- 1,405,819 1,420,019
Distributions to partners (17,558) -- (1,738,262) (1,755,820)
------------ ------------ ------------ ------------
BALANCE, September 30, 1997 $ (20,568) 26,709 $ 19,920,559 $ 19,899,991
============ ============ ============ ============
</TABLE>
<PAGE>
PARTICIPATING INCOME PROPERTIES III LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,420,019 $ 1,418,562
Adjustments to net income:
Depreciation 335,801 337,274
Change in assets and liabilities:
Increase in receivables from lessees (12,000) (4,313)
Decrease in payable to general partner (7,720) --
Increase (decrease) in rental deposits and other (5,281) 1,511
----------- -----------
Net cash provided by operating
activities 1,730,819 1,753,034
CASH FLOWS FOR FINANCING ACTIVITIES:
Distributions to partners (1,755,779) (1,755,780)
----------- -----------
NET DECREASE IN CASH AND
CASH EQUIVALENTS (24,960) (2,746)
CASH AND CASH EQUIVALENTS, beginning of period 651,261 638,406
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 626,301 $ 635,660
=========== ===========
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of
- ------- Financial Condition and Results of Operations
---------------------------------------------
As of September 30, 1997, Participating Income Properties III Limited
Partnership, a Delaware limited partnership, (the Registrant), had
received $26,709,000 in gross proceeds from its offering of Units. Net
funds available for investment, after payment of sales commissions,
organization costs and acquisition fees, amounted to $23,012,902. The
offering of Units is the Registrant's sole source of capital, and since
the final closing of limited partnership units was held on February 28,
1992, the Registrant will not receive additional funds from the offering.
The Registrant was fully invested in travel plaza properties and mortgages
by June 30, 1993 and does not anticipate any further capital expenditures.
The Registrant declared a cash distribution to the limited partners of
$579,419 for the quarter ended September 30, 1997 (the period), which,
combined with the first and second quarterly distributions of $1,158,843
amounts to $1,738,262 year to date. During the period, all net proceeds
not invested in travel plaza property and the mortgage loan were invested
in Government Agency discount notes and bank repurchase agreements (which
are secured by United States Treasury and Government obligations).
During the period, the Registrant received base rental revenue and
mortgage loan interest income pursuant to its travel plaza lease and loan
arrangements in the amount of $530,495, which remains unchanged from the
prior year (year-to-date base rental revenue and mortgage loan interest
income are similarly unchanged). In addition, the Registrant received or
accrued participating rentals of $153,436 and $401,758, respectively, for
the quarter and nine months ended September 30, 1997, representing an
increase over participating rentals of $124,377 and $380,590,
respectively, for the comparable periods in 1996. On June 1, 1996, CFJ
Properties (lessee of two of the Registrant's travel plazas) curtailed its
relationship with a large third party billing company for the trucking
industry. The billing company requested changes to its contract that were
unacceptable to CFJ Properties' management due to the significant
long-term ramifications of the proposed change on CFJ Properties' future
business. This resulted in reduced volume and margins, which contributed
to low participating rental revenues in the quarter ended September 30,
1996 as compared to the quarter ended September 30, 1997. Participating
rentals for the corresponding year-to-date periods were similarly
affected, although to a lesser extent. Total expenses for the quarter and
nine months ended September 30, 1997 increased $29,237 and $19,890,
respectively, over the comparable periods of the prior year due to
increases in general partner fees resulting from increased operating
revenues. Net income for the three and nine months ended September 30,
1997 remained relatively unchanged from the comparable periods in 1996.
The decrease in total assets reflected in the Registrant's financial
statements filed with this report is mainly attributable to the
depreciation allowance, which is deducted for accounting purposes from the
cost of the assets on the Registrant's books.
In the opinion of management, the financial information included in this
report reflects all adjustments necessary for fair presentation. All such
adjustments are of a normal recurring nature.
<PAGE>
FFCA/PIP III INVESTOR SERVICES CORPORATION
------------------------------------------
BALANCE SHEET - SEPTEMBER 30, 1997
----------------------------------
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Cash $100
Investment in Participating Income Properties III Limited Partnership, at cost 100
----
Total Assets $200
====
LIABILITY
Payable to Parent $100
STOCKHOLDER'S EQUITY
Common Stock; $l par value; 100 shares authorized,
issued and outstanding 100
----
Liability and Stockholder's Equity $200
====
</TABLE>
Note: FFCA/PIP III Investor Services Corporation (the Corporation) was
incorporated on December 5, 1988, and amended on July 9, 1990 to act as the
assignor limited partner in Participating Income Properties III Limited
Partnership (PIP III).
The assignor limited partner is the owner of record of the limited
partnership units of PIP III. All rights and powers of the Corporation have been
assigned to the holders, who are the registered and beneficial owners of the
units. Other than to serve as assignor limited partner, the Corporation has no
other business purpose and will not engage in any other activity or incur any
debt.
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have caused this report to be signed on their behalf by the
undersigned thereunto duly authorized.
PARTICIPATING INCOME PROPERTIES III LIMITED
PARTNERSHIP
By FFCA PARTICIPATING MANAGEMENT COMPANY
LIMITED PARTNERSHIP
Managing General Partner
By FRANCHISE FINANCE CORPORATION OF AMERICA III
Corporate General Partner
Date: October 22, 1997 By /s/ John Barravecchia
-------------------------------------------------
John Barravecchia, Chief Financial Officer
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
co-registrant has caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FFCA/PIP III INVESTOR SERVICES CORPORATION
Date: October 22, 1997 By /s/ John Barravecchia
-----------------------------------------------------
John Barravecchia, President
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE BALANCE SHEET AS OF SEPTEMBER 30, 1997 AND
THE STATEMENT OF INCOME FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 865828
<NAME> PARTICIPATING INCOME PROPERTIES III LIMITED PARTNERSHIP
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<EXCHANGE-RATE> 1
<CASH> 626,301
<SECURITIES> 0
<RECEIVABLES> 50,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 14,642,838
<DEPRECIATION> 2,384,642
<TOTAL-ASSETS> 20,729,705
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 19,899,991
<TOTAL-LIABILITY-AND-EQUITY> 20,729,705
<SALES> 0
<TOTAL-REVENUES> 2,010,110
<CGS> 0
<TOTAL-COSTS> 590,091
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,420,019
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,420,019
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,420,019
<EPS-PRIMARY> 52.63
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE BALANCE SHEET AS OF SEPTEMBER 30, 1997
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
BALANCE SHEET.
</LEGEND>
<CIK> 865829
<NAME> FFCA/PIP III INVESTOR SERVICES CORPORATION
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<EXCHANGE-RATE> 1
<CASH> 100
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 200
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 100
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 200
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
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