<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 March 31, 2000 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 0-21580
-------------------------------------------------------
Wells Real Estate Fund V, L.P.
- ------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Georgia 58-1936904
- ----------------------------- ------------------------
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification no.)
6200 The Corners Parkway Suite 250, Norcross, Georgia 30092
- ------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (770) 449-7800
--------------
______________________________________________________________________________
(Former name, former address and former fiscal year,
if changed since last report)
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 ___
-----
1
<PAGE>
Form 10-Q
---------
Wells Real Estate Fund V, L.P.
------------------------------
INDEX
-----
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets - March 31, 2000
and December 31, 1999................................. 3
Statements of Income for the Three
Months Ended March 31, 2000
and 1999.............................................. 4
Statement of Partners' Capital
for the Year Ended December 31, 1999,
and the Three Months Ended March 31, 2000............. 5
Statements of Cash Flows for the Three Months
Ended March 31, 2000 and 1999......................... 6
Condensed Notes to Financial Statements................ 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations.......................................... 8
PART II. OTHER INFORMATION............................................ 15
</TABLE>
2
<PAGE>
WELLS REAL ESTATE FUND V, L.P.
(a Georgia Public Limited Partnership)
BALANCE SHEETS
<TABLE>
<CAPTION>
Assets March 31, 2000 December 31, 1999
------ -------------- -----------------
<S> <C> <C>
Investment in joint ventures (Note 2) $ 12,046,095 $ 12,178,473
Cash and cash equivalents 5,927 21,620
Due from affiliates 253,121 299,144
---------- ----------
Total assets $ 12,305,143 $ 12,499,237
========== ==========
Liabilities and Partners' Capital
---------------------------------
Liabilities:
Partnership distributions payable $ 242,496 $ 304,213
---------- ----------
Partners' capital:
Limited partners
Class A - 1,566,416 units outstanding 12,062,647 12,195,024
Class B - 134,186 units outstanding 0 0
---------- ----------
Total partners' capital 12,062,647 12,195,024
---------- -----------
Total liabilities and partners' capital $ 12,305,143 $ 12,499,237
========== ==========
</TABLE>
See accompanying condensed notes to financial statements.
3
<PAGE>
WELLS REAL ESTATE FUND V, L.P.
(a Georgia Public Limited Partnership)
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31, 2000 March 31, 1999
-------------- --------------
<S> <C> <C>
Revenues:
Interest income $ 123 $ 630
Equity in income of joint
ventures
(Note 2) 135,743 169,843
------- -------
135,866 170,473
------- -------
Expenses:
Legal and accounting 12,782 5,740
Computer costs 3,067 2,820
Partnership administration 9,900 18,670
------- -------
25,749 27,230
------- -------
Net income $ 110,117 $ 143,243
======= =======
Net income allocated to Class A $ 110,117 $ 143,243
Limited Partners
Net loss allocated to Class B $ 0 $ 0
Limited Partners
Net income per Class A Limited $ 0.07 $ 0.09
Partner Unit
Net loss per Class B Limited $ 0 $ 0
Partner Unit
Cash distribution per Class A
Limited $ 0.15 $ 0.18
</TABLE>
See accompanying condensed notes to financial statements.
4
<PAGE>
WELLS REAL ESTATE FUND V, L.P.
(a Georgia Public Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
FOR THE YEAR ENDED DECEMBER 31, 1999 AND THE THREE MONTHS ENDED
MARCH 31, 2000
<TABLE>
<CAPTION>
Limited Partners Total
-----------------------------------------
Class A Class B General Partners'
------- -------
Units Amount Units Amount Partners Capital
----- ------ ----- ------ -------- ------
<S> <C> <C> <C> <C> <C> <C>
BALANCE, December 31, 1998 1,559,021 $12,760,313 141,581 $ 0 $ 0 $12,760,313
Net income 0 625,679 0 0 0 625,679
Partnership distributions 0 (1,190,968) 0 0 0 (1,190,968)
Class B conversion elections 7,395 0 (7,395) 0 0 0
--------- ----------- -------- ------- ------- -----------
BALANCE, December 31, 1999 1,566,416 12,195,024 134,186 0 0 12,195,024
Net income 0 110,117 0 0 0 110,117
Partnership distributions 0 (242,494) 0 0 0 (242,494)
--------- ----------- -------- ------- ------ -----------
BALANCE, March 31, 2000 1,566,416 $12,062,647 134,186 $ 0 $ 0 $12,062,647
========= =========== ======== ======= ====== ===========
</TABLE>
See accompanying condensed notes to financial statements.
5
<PAGE>
WELLS REAL ESTATE FUND V, L.P.
(a Georgia Public Limited Partnership)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31, 2000 March 31, 1999
Cash flow from operating activities: -------------- --------------
<S> <C> <C>
Net income $ 110,117 $ 143,243
Adjustments to reconcile net income
to net cash used in operating activities: (135,743) (169,843)
Equity in income of joint venture
Changes in assets and liabilities:.
Accounts payable 0 (4,274)
------------ ------------
Net cash used in operating
activities (25,626) (30,874)
------------ ------------
Cash flow from investing activities:
Distributions received from
joint ventures 314,144 300,674
Investment in joint ventures 0 (17,357)
------------ ------------
Net cash provided by investing
activities 314,144 283,317
------------ ------------
Cash flow from financing activities:
Partnership distributions paid (304,211) (273,917)
------------ ------------
Net decrease in cash
and cash equivalents (15,693) (21,474)
Cash and cash equivalents, beginning of year 21,620 63,998
------------ ------------
Cash and cash equivalents, end of period $ 5,927 $ 42,524
============ ============
</TABLE>
See accompanying condensed notes to financial statements.
6
<PAGE>
WELLS REAL ESTATE FUND V, L.P
(A Georgia Public Limited Partnership)
Condensed Notes to Financial Statements
(1) Summary of Significant Accounting Policies
------------------------------------------
(a) General
-----------
Wells Real Estate Fund V, L.P. ("the partnership") is a Georgia public
limited partnership having Leo F. Wells, III and Wells Partners, L.P., as
General Partners. The Partnership was formed on October 25, 1990, for the
purpose of acquiring, developing, owning, operating, improving, leasing,
and otherwise managing for investment purposes income producing commercial
or industrial properties.
On March 6, 1992, the Partnership commenced an offering of up to
$25,000,000 of Class A or Class B limited partnership units ($10.00 per
unit) pursuant to a Registration Statement on Form S-11 filed under the
Securities Act of 1933. The Partnership did not commence active operations
until it received and accepted subscriptions for a minimum of 125,000 units
on April 27, 1992. The offering was terminated on March 3, 1993, at which
time the Partnership had sold 1,520,967 Class A Units and 179,635 Class B
Units representing $17,006,020 of capital contributions by investors who
were admitted to the Partnership as Limited Partners.
The Partnership owns interests in properties through its equity ownership
in the following joint ventures: (i) Fund IV and Fund V Associates, a joint
venture between the Partnership and Wells Real Estate Fund IV, L.P. (the
"Fund IV - Fund V Joint Venture"); (ii) Fund V and Fund VI Associates, a
joint venture between the Partnership and Wells Real Estate Fund VI, L.P.
(the "Fund V - Fund VI Joint Venture"); and (iii) Fund V, Fund VI, and Fund
VII Associates, a joint venture between the Partnership, Wells Real Estate
Fund VI, L.P. and Wells Real Estate Fund VII, L.P. (the "Fund V-VI-VII
Joint Venture").
As of March 31, 2000, the Partnership owned interests in the following
properties through its ownership in the foregoing joint ventures: (i) a
four-story office building located in Jacksonville, Florida ("IBM
Jacksonville"), which is owned by the Fund IV - Fund V Joint Venture; (ii)
two substantially identical two-story office buildings located in Clayton
County, Georgia (the "Village Overlook Property"), which are owned by the
Fund IV - Fund V Joint Venture; (iii) a four-story office building located
in metropolitan Hartford, Connecticut (the "Hartford Building"), which is
owned by the Fund V - Fund VI Joint Venture; (iv) two retail buildings
located in Clayton County, Georgia ("Stockbridge Village II"), which are
owned by the Fund V - Fund VI Joint Venture; and (v) a three-story office
building located in Appleton, Wisconsin (the "Marathon Building"), which is
owned by the Fund V-VI-VII Joint Venture. All of the foregoing properties
were acquired on an all cash basis. For further information regarding
these joint ventures and properties, refer to the Partnership's Form 10-K
for the year ended December 31, 1999.
7
<PAGE>
(B) Basis of Presentation
-------------------------
The financial statements of the Partnership have been prepared in
accordance with instructions to Form 10-Q and do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. These quarterly statements
have not been examined by independent accountants, but in the opinion of
the General Partners, the statements for the unaudited interim periods
presented include all adjustments, which are of a normal and recurring
nature, necessary to present a fair presentation of the results for such
periods. For further information, refer to the financial statements and
footnotes included in the Partnership's Form 10-K for the year ended
December 31, 1999.
(2) Investment in Joint Ventures
----------------------------
The Partnership owns interests in five properties through its investment in
joint ventures of which four are office building properties and one is a
retail property. The Partnership does not have control over the operations
of the joint ventures; however, it does exercise significant influence.
Accordingly, investment in joint ventures is recorded on the equity method.
For further information, refer to the financial statements and footnotes
included in the Partnership's Form 10-K for the year ended December 31,
1999.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
------------------------------------------------------------------------
RESULTS OF OPERATIONS.
---------------------
The following discussion and analysis should be read in conjunction with
the accompanying financial statements of the Partnership and notes thereto.
This Report contains forward-looking statements, within the meaning of
Section 27A of the Securities Act of 1933 and 21E of the Securities
Exchange Act of 1934, including discussion and analysis of the financial
condition of the Partnership, anticipated capital expenditures required to
complete certain projects, amounts of cash distributions anticipated to be
distributed to Limited Partners in the future and certain other matters.
Readers of this Report should be aware that there are various factors that
could cause actual results to differ materially from any forward-looking
statement made in this Report, which include construction costs which may
exceed estimates, construction delays, lease-up risks, inability to obtain
new tenants upon expiration of existing leases, and the potential need to
fund tenant improvements or other capital expenditures out of operating
cash flow.
Results of Operations and Changes in Financial Conditions
---------------------------------------------------------
General
-------
As of March 31, 2000, the developed properties of the Partnership were 94%
occupied as compared to 96% occupied at March 31, 1999. Gross revenues of
the Partnership were $135,866 for the three months ended March 31, 2000, as
compared to $170,473 for the three months ended March 31, 1999 primarily
due to decreased earnings from the Fund IV - Fund V Joint Venture.
Although total expenses remained relatively stable, legal and accounting
8
<PAGE>
has increased due to timing differences in the payment of accounting fees
while partnership administration expenses have decreased from 1999 levels.
As a result, net income has decreased for the three months ended March 31,
2000, over 1999 levels.
Net cash used in operating activities decreased from $30,874 for the three
months ended March 31, 1999 to $25,626 for the same period in 2000. The
decrease in cash and cash equivalents from $21,474 for the three months
ended March 31, 1999, to $15,693 for the three months ended March 31, 2000,
was due primarily to a decrease in investments in joint ventures.
The Partnership made cash distributions to the Limited Partners holding
Class A Units of $.15 per Class A Unit for the three months ended March 31,
2000, as compared to distributions of $.18 per Class A Unit for the three
months ended March 31, 1999. No cash distributions were made to the
Limited Partners holding Class B Units or to the General Partners.
The Partnership expects to continue to meets its short-term liquidity
requirements and budget demands generally through net cash provided by
operations which the Partnership believes will continue to be adequate to
meet both operating requirements and distributions to limited partners. At
this time, given the nature of the joint ventures in which the Partnership
has invested, there are no known improvements and renovations to the
properties expected to be funded from cash flow operations.
9
<PAGE>
Property Operations
-------------------
As of March 31, 2000, the Partnership owned interests in the following
operational properties:
The Marathon Building/Fund V-VI-VII Joint Venture
-------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31, 2000 March 31, 1999
-------------- --------------
<S> <C> <C>
Revenues:
Rental income $ 242,763 $ 242,754
----------- ----------
Expenses:
Depreciation 87,646 87,646
Management & leasing expenses 2,361 16,244
Other operating expenses 4,966 7,546
----------- ----------
94,973 111,436
----------- ----------
Net income $ 147,790 $ 131,318
=========== ==========
Occupied % 100% 100%
Partnership Ownership % 16.5% 16.5%
Cash Distribution to Partnership $ 39,106 $ 36,396
Net Income Allocated to the
Partnership $ 24,326 $ 21,615
</TABLE>
Rental income remained stable for the three months ended March 31, 2000, as
compared to the three months ended March 31, 1999.
Management and leasing fees decreased for the three months ended March 31, 2000,
as compared to the same period last year due to a lower rate charged started
October, 1999, when this single tenant's lease became a triple net lease.
Operating expenses decreased due primarily to timing differences in the payment
of accounting fees.
10
<PAGE>
IBM Jacksonville /Fund IV - Fund V Joint Venture
- ------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31, 2000 March 31, 1999
-------------- --------------
<S> <C> <C>
Revenues:
Rental Income $360,380 $364,385
-------- --------
Expenses:
Depreciation 80,193 79,524
Management & leasing expenses 46,102 49,785
Other operating expenses 152,976 114,977
-------- --------
279,271 244,286
-------- --------
Net income $ 81,109 $120,099
======== ========
Occupied % 93.5% 93.5%
Partnership Ownership % 62.3% 62.4%
Cash Distribution to Partnership $101,705 $136,606
Net Income Allocated to the
Partnership $ 50,557 $ 74,972
</TABLE>
Rental income for the IBM Jacksonville Property remained relatively stable in
2000, as compared to 1999. Operating expenses increased in 2000, due to repairs
and maintenance for the irrigation works and parking lot lighting on the
property. Cash distributions decreased for 2000 as compared to 1999 due to
capital improvements funded from cash flow. Wells Fund IV contributed cash
fundings to the Joint Venture for tenant improvements and this decreased the
Partnership's ownership interest in the Fund IV - Fund V Joint Venture.
11
<PAGE>
The Village Overlook Property/Fund IV - Fund V Joint Venture
- ------------------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31, 2000 March 31, 1999
-------------- --------------
<S> <C> <C>
Revenues:
Rental Income $135,151 $144,578
Interest Income 1,131 575
-------- --------
136,282 145,153
-------- --------
Expenses:
Depreciation 46,057 44,524
Management & leasing expenses 9,759 17,773
Other operating expenses 74,685 45,404
-------- --------
130,501 107,701
-------- --------
Net income $ 5,781 $ 37,452
======== ========
Occupied % 82% 92%
Partnership Ownership % 62.3% 62.4%
Cash Distribution to Partnership $ 22,663 $ 45,672
Net Income Allocated to the
Partnership $ 3,604 $ 23,380
</TABLE>
Rental income and management and leasing expenses decreased in 2000, as compared
to 1999, due primarily to a decrease in the occupancy level of the property.
Operating expenses increased in 2000, over 1999, due to extraordinary repairs
and maintenance of the common area floor space. Cash distributions decreased for
2000, compared to 1999, due to capital improvements funded from cash flow. Wells
Fund IV contributed cash fundings to the Joint Venture for tenant improvements
and this decreased the Partnership's ownership interest in the Fund IV - Fund V
Joint Venture.
12
<PAGE>
The Hartford Building/Fund V - Fund VI Joint Venture
- ----------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31, 2000 March 31, 1999
-------------- --------------
<S> <C> <C>
Revenues:
Rental income $179,375 $179,375
-------- --------
Expenses:
Depreciation 73,008 73,008
Management & leasing expenses 7,242 7,242
Other operating expenses 4,117 5,319
-------- --------
84,367 85,569
-------- --------
Net income $ 95,008 $ 93,806
======== ========
Occupied % 100% 100%
Partnership Ownership % 46.4% 46.5%
Cash Distribution to Partnership $ 78,742 $ 78,313
Net Income Allocated to the
Partnership $ 44,086 $ 43,601
</TABLE>
Rental income, net income and cash distributions to the Partnership remained
relatively stable for the three months ended March 31, 2000 and 1999, due to the
stable occupancy rate.
The Partnership's ownership interest in the Fund V - Fund VI Joint Venture
decreased due to additional funding by Wells Fund VI in the second quarter of
1999, which caused a decrease in the Partnership's ownership interest in the
Fund V - Fund VI Joint Venture.
13
<PAGE>
Stockbridge Village II/Fund V - Fund VI Joint Venture
- -----------------------------------------------------
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31, 2000 March 31, 1999
-------------- --------------
<S> <C> <C>
Revenues:
Rental income $77,649 $59,408
------- -------
Expenses:
Depreciation 26,241 25,743
Management & leasing expenses 9,627 6,889
Other operating expenses 13,400 13,275
------- -------
49,268 45,907
------- -------
Net income $28,381 $13,501
======= =======
Occupied % 100% 72%
Partnership Ownership % 46.4% 46.5%
Cash Distribution to Partnership $25,906 $13,423
Net Income Allocated to the
Partnership $13,170 $ 6,275
</TABLE>
Rental income, net income and cash distribution to the Partnership increased in
2000, as compared to 1999, due primarily to increased occupancy. The
Partnership's ownership percentage in the Fund V - Fund VI Joint Venture
decreased due to additional fundings by Wells Fund VI, which caused a decrease
in the Partnership's ownership interest in the Fund V - Fund VI Joint Venture.
14
<PAGE>
PART II - OTHER INFORMATION
---------------------------
ITEM 6 (b). No reports on Form 8-K were filed during the first quarter of 2000.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
WELLS REAL ESTATE FUND V, L.P.
Dated: May 11, 2000 By: /s/ Leo F. Wells, III
----------------------
Leo F. Wells, III, as Individual
General Partner and as President,
Sole Director and Chief Financial
Officer of Wells Capital, Inc., the
General Partner of Wells Partners, L.P.
15
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 5,927
<SECURITIES> 12,046,095
<RECEIVABLES> 253,121
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 12,305,143
<CURRENT-LIABILITIES> 242,496
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 12,062,647
<TOTAL-LIABILITY-AND-EQUITY> 12,305,143
<SALES> 0
<TOTAL-REVENUES> 135,866
<CGS> 0
<TOTAL-COSTS> 25,749
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 110,117
<INCOME-TAX> 110,117
<INCOME-CONTINUING> 110,117
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 110,117
<EPS-BASIC> .07
<EPS-DILUTED> 0
</TABLE>
