<PAGE> 1
FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
(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, 1997
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 0-20180
INTERNATIONAL REALTY GROUP, INC.
(Exact name of registrant as specified in its charter)
------------------------------------------------------
<TABLE>
<S> <C>
Delaware 62-1277260
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(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
111 Northwest 183rd Street, Suite 518, Miami, Florida 33169
- ---------------------------------------------------------------------------------------------------------
(Address of principal executive office) (Zip Code)
</TABLE>
305-944-8811
--------------
(Registrant's telephone number, including area code)
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 No X
--- ---
The number of shares outstanding of each of Issuer's classes of common equity as
of November 1, 1997.
Common Stock, par value $.001 9,954,313
----------------------------- --------------
Title of Class Number of Shares
Transitional Small Business Disclosure Format yes no X
---- ----
<PAGE> 2
PART I: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
INTERNATIONAL REALTY GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
MARCH 31, 1997
(UNAUDITED, NOTE 1)
<TABLE>
ASSETS
<S> <C> <C>
REAL ESTATE AT COST:
PROPERTY HELD FOR FUTURE DEVELOPMENT $ 10,556,100
RECEIVABLES:
DUE FROM CONTROLLING SHAREHOLDER 2,212,400
ACCOUNTS RECEIVABLE, DEEMED FULLY COLLECTIBLE 154,000
------------
2,366,400
CASH AND CASH EQUIVALENTS 31,200
FURNITURE, EQUIPMENT AND IMPROVEMENTS, NET 161,200
EXCESS OF COST OVER ESTIMATED FAIR VALUE OF 118,800
NET ASSETS ACQUIRED
OTHER ASSETS 132,400
------------
TOTAL $ 13,366,100
============
LIABILITIES AND SHAREHOLDER'S EQUITY
LIABILITIES:
MORTGAGES AND NOTES PAYABLE (NOTE 2) $ 1,224,100
ACCOUNTS PAYABLE 295,500
ACCRUED AND OTHER LIABILITIES 826,300
------------
$ 2,345,900
MINORITY INTEREST 1,330,000
SHAREHOLDERS' EQUITY:
COMMON STOCK, $.001 PAR; AUTHORIZED 10,000,000
SHARES; 9,954,250 SHARES ISSUED AT 3/31/97 10,000
CAPITAL IN EXCESS OF PAR 4,917,400
CONVERTIBLE NOTES (NOTE 3) 9,707,400
CUMULATIVE TRANSLATION ADJUSTMENT (205,400)
ACCUMULATED DEFICIT (4,723,700)
------------
9,705,700
LESS SHARES OF COMMON STOCK HELD IN TREASURY,
AT COST 15,500
------------
TOTAL SHAREHOLDERS' EQUITY 9,690,200
------------
TOTAL $ 13,366,100
============
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
1
<PAGE> 3
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 1. FINANCIAL STATEMENTS, CONTINUED.
INTERNATIONAL REALTY GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1997 AND MARCH 31, 1996
(UNAUDITED, NOTE 1)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
THREE MONTHS
ENDED MARCH 31,
1997 1996
-----------------------------
<S> <C> <C>
REVENUES
REVENUES FROM SERVICES PROVIDED $ 177,100 $ 162,200
------------ ----------
OPERATING EXPENSES:
AMORTIZATION AND DEPRECIATION 14,000 14,400
DIRECT 102,600 112,100
PAYROLL AND RELATED BENEFITS 48,000 67,600
SELLING, GENERAL AND ADMINISTRATIVE 33,400 75,500
------------ ----------
198,100 269,700
------------ ----------
LOSS BEFORE OTHER INCOME (EXPENSE), MINORITY INTEREST AND PROVISION FOR INCOME (21,000) (107,500)
TAXES (BENEFIT)
OTHER INCOME (EXPENSE):
INTEREST INCOME -- 26,400
INTEREST EXPENSE (32,800) (26,400)
GAIN (LOSSES) ON EXCHANGE RATE FLUCTUATIONS (8,200) (134,900)
OTHER INCOME (EXPENSE) 1,300 --
------------ ----------
LOSS BEFORE MINORITY INTEREST AND PROVISION FOR INCOME TAXES (60,700) (242,400)
MINORITY INTEREST IN INCOME (LOSS) OF SUBSIDIARIES (11,800) (33,500)
------------ ----------
LOSS BEFORE PROVISION FOR INCOME TAXES (48,900) (208,900)
PROVISION FOR INCOME TAXES -- 16,200
------------ ----------
NET LOSS $ (48,900) $ (225,200)
============ ==========
LOSS PER SHARE OF COMMON STOCK
(.00) (.02)
============ ==========
WEIGHTED AVERAGE NUMBER OF SHARES 9,954,187 9,954,187
============ ==========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
2
<PAGE> 4
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 1. FINANCIAL STATEMENTS, CONTINUED.
INTERNATIONAL REALTY GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1997
(UNAUDITED, NOTE 1)
<TABLE>
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
SOURCES OF CASH:
CLIENTS AND OTHER 344,900
INTEREST --
-----------
344,900
-----------
USES OF CASH:
CASH PAID FOR:
DIRECT COSTS 209,500
OPERATING 34,500
PAYROLL AND RELATED 46,800
INTEREST 1,700
-----------
292,500
-----------
CASH PROVIDED BY OPERATING ACTIVITIES $ 52,400
CASH FLOW USED IN INVESTING ACTIVITIES:
USE OF CASH:
ACQUISITION OF EQUIPMENT (700)
CASH FLOW USED IN FINANCING ACTIVITIES:
USE OF CASH:
PAYMENT OFNOTES PAYABLE (43,700)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS 15,600
------------
INCREASE IN CASH AND CASH EQUIVALENTS 23,600
CASH AND CASH EQUIVALENTS, BEGINNING 7,600
------------
CASH AND EQUIVALENTS, ENDING $ 31,200
------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
3
<PAGE> 5
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 1. FINANCIAL STATEMENTS, CONTINUED.
INTERNATIONAL REALTY GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
THREE MONTHS ENDED MARCH 31, 1996
(UNAUDITED, NOTE 1)
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<S> <C> <C>
RECONCILIATION OF NET LOSS TO CASH
PROVIDED BY OPERATING ACTIVITIES:
NET LOSS $ (48,900)
ADJUSTMENTS TO RECONCILE NET LOSS TO
CASH PROVIDED BY OPERATING ACTIVITIES:
AMORTIZATION AND DEPRECIATION $ 14,000
MINORITY INTEREST (11,800)
CURRENCY FLUCTUATION 8,200
CHANGES IN ASSETS & LIABILITIES:
ACCOUNTS RECEIVABLE 166,500
OTHER ASSETS (106,400)
ACCOUNTS PAYABLE: (49,100)
ACCRUED LIABILITIES $ 79,900
-------------
NET ADJUSTMENTS 101,300
-------------
CASH PROVIDED BY OPERATING ACTIVITIES $ 52,400
=============
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
4
<PAGE> 6
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 1. FINANCIAL STATEMENTS, CONTINUED.
INTERNATIONAL REALTY GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
MARCH 31, 1997
(1) PRINCIPLES OF STATEMENT PRESENTATION
The unaudited consolidated financial statements include all adjustments which
are necessary, in the opinion of management, to fairly reflect the Company's
financial position and results of operations. All such adjustments are of a
normal recurring nature. The statements have been prepared using the accounting
policies described in the Company's 1996 Audited Financial Statements contained
in the Company's Form 10-KSB for the year ended December 31, 1996.
The Company has changed its balance sheet presentation to a non-classified
balance sheet due to the change from principally the service industry to
principally real estate holdings and made other reclassifications. (See Item 2.
Management's Discussion and Analysis or Plan of Operations). Such change in
presentation had no effect on operations. Balances for the three months ended
March 31, 1997 have been reclassified where appropriate to conform to the
comparable March 31, 1996 period's financial statement presentation.
(2) MORTGAGE AND NOTES PAYABLE
Mortgages and Notes Payable at March 31, 1997 is summarized as follows:
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<S> <C>
Mortgage Note, bank $ 462,300
Note Payable, bank 630,400
-----------
Total Payable to banks $ 1,092,700
Note Payable, unsecured 48,600
Note Payable, related party 24,600
Shareholder Loan 58,200
-----------
$ 1,224,100
===========
</TABLE>
(3) CONVERTIBLE NOTE
Convertible Notes issued at August 19, 1996 are summarized as follows:
<TABLE>
<S> <C> <C>
$4,858,828 convertible into 52,875,030 shares
$4,848,558 convertible into 52,763,270 shares
---------- ------------------
$9,707,386 convertible into 105,638,300 shares
</TABLE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.
The following discussion and analysis covers any material changes in financial
condition since December 31, 1996 and any material changes in the results of
operations for the three months ended March 31, 1997, as compared to the same
period in 1996. This discussion and analysis should be read in conjunction with
"Management's Discussion and Analysis or Plan of Operations" included in the
Company's Form 10-KSB for the year ended December 31, 1996
5
<PAGE> 7
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.
GENERAL
The Company consummated a share exchange transaction on August 19, 1996
resulting in a reverse acquisition which has been accounted for in a manner
similar to a pooling of interests. Accordingly, the consolidated financial
statements for the three month period ending March 31, 1997 and the
corresponding 1996 period have been retroactively restated to include the
accounts of the companies transferred in such pooling of interest.
ORGANIZATION AND BUSINESS
INTERNATIONAL REALTY GROUP, INC., together with its consolidated subsidiaries
(the "Company"), is a provider of commercial real estate and business valuations
and appraisals in the United States and Hungary and land development primarily
in Mexico. The Company will be developing its Mexican properties into various
resort and commercial developments. Once developed they will engage in the
marketing and operation of its properties and other ancillary real estate
activities. The Company is in the preliminary stages of seeking financing to
commence development projects. No development of the properties located in
Mexico will occur until after the conversion of the notes issued to DSC and
Hemisphere, which notes are collateralized by the properties located in Mexico.
The Company was incorporated in Delaware on April 13, 1970 and operated under
the name Bosco Resources Corporation until June 10, 1973, when it ceased
operations after its assets were nationalized without compensation by the Libyan
Government. The Company remained inactive until December 15, 1986 when it
acquired all of the outstanding shares of APPRAISAL GROUP, INC. in exchange for
4,150,000 shares of common stock (after a 1 for 8 reverse split) and changed its
name to APPRAISAL GROUP INTERNATIONAL INC. Subsequently, on August 10, 1989, the
Company's name was changed to INTERNATIONAL REALTY GROUP, INC.
RESULTS OF OPERATIONS:
THREE MONTHS ENDED MARCH 31, 1997 COMPARED TO THREE MONTHS ENDED MARCH 31, 1996
Revenues increased for the three months ended March 31, 1997 totaling $177,100
as compared to $162,200 for the same period in 1996. The Company's domestic and
foreign valuation subsidiaries Appraisal Group International, Inc. (AGII) based
in Miami, Florida and Appraisal Group International Rt.(AGI RT.) based in
Budapest, Hungary accounted for the Company's revenues. AGII had sales of
$158,200 for the period, compared to $75,400 for the same period in 1996, a 52%
increase. AGII has instituted certain marketing programs to reverse its
declining sales over the last few years, with the results beginning to show some
effect. AGI RT. had sales of $20,300, compared to $86,800 for the same period in
1996. The continued decline is attributed to the decrease in appraisal
assignments with the Hungarian government which is at the end of the
privatization process. The Company is focusing its marketing efforts towards
expanding its presence in the field of corporate liquidations on behalf of the
Hungarian court.
Operating expenses for the three months ended March 31, 1997 were $198,100
compared to $269,700 for the comparable period in 1996, a decrease of $71,600 or
27%. Of the total expenses, foreign operations accounted for 17% and domestic
operations accounted for 83%.
6
<PAGE> 8
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.
Selling, General and Administrative expenses for the period decreased from
$75,500 in 1996 to $33,400 for the current period. Payroll and Related Benefits
for the period decreased from $67,600 in 1996 to $48,000 for the current period.
Direct expenses including the production of appraisal reports, fees and related
expenses for the period decreased from $112,100 in 1996 to $102,600 for the
current period. Amortization and Depreciation expense was consistent between the
periods.
Interest expense for the three months ended March 31, 1997 were $32,800 compared
to $26,400 for the same period in 1996. The majority of interest expense
($31,262) is attributable to debt for properties located in Mexico. Such debt is
recognized in the period it occurs and is accrued per agreement with the Lender.
Currency translation expenses were $8,200 for the current 1997 period compared
to $134,900 for the comparable period in 1996. Such translation expense is
attributable to the currency fluctuations of the Mexican peso during each such
period.
LIQUIDITY AND CAPITAL RESOURCES:
Cash Flow From Operations. The Company incurred for the three months ended March
31, 1997, a net loss of $48,900 compared to a net loss of $225,200 for the
comparable period in 1996. Cash flow provided by operations were $52,400.
Working Capital. The Company's current assets, consisting of cash and
receivables of approximately $2,397,600, exceed its current liabilities
consisting of accounts payable and accrued liabilities by approximately
$1,275,800. Included in current liabilities are accrued officer's salaries
amounting to approximately $486,400.
Long Term Liabilities: Mortgage and Notes Payable for the three months ended
March 31, 1996 were $1,224,100. Of this amount, mortgages to Mexican banks for
property currently held for future developed totaled $1,092,700. Of the
remainder, $106,700 is attributable to domestic operations and $24,600 to
foreign operations.
Land Development: Pursuant to the Company's reverse merger transaction with DSC,
S.A. de C.V. ("DSC") and Hemisphere Developments Limited ("Hemisphere"), the
Company acquired interests in five properties located in Mexico. The Company
believes that each of the Mexican properties is suitable for future development
as either a resort, residential or commercial property. Since the properties
secure the Company's obligations under the convertible notes issued to DSC and
Hemisphere in the aggregate amount of $9,707,386 ("Notes"). The Company does not
plan to undertake any development of such properties until after the Notes have
been converted. While no assurances can be given, the Company expects that the
conversion of the Notes (convertible into an aggregate of 105,638,300 shares of
the Company's Common Stock) will occur in the first quarter of 1998. The Company
has no interest obligations under the Notes. Any development of the properties
thereafter is contingent upon the Company obtaining necessary financing.
Potential sources of financing include mortgage financing from financial
institutions located in the United States or Mexico, or the issuance of equity
securities of the Company. The Company has no present understanding, agreement
or commitment for financing any such property and there can be no assurance that
financing will be available to the Company on commercially reasonable terms or
at all.
7
<PAGE> 9
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.
Currency Risk. The Company's operating entities are not subject to direct
currency conversion risks. The Company's primary operating entities provide
consulting services to their clients in their own geographic locations. All
domestic consulting services performed by AGII based in Miami, Florida are
reported and paid in U.S. dollars. All foreign consulting services, assets and
liabilities of AGI RT. based in Hungary, are translated into U.S. dollars at
period-end exchange rates with the resulting translation adjustment recorded in
accumulated translation adjustment in shareholder's equity.
The functional currency of the Mexican companies is the U.S. dollar. Therefore,
all peso denominated transactions represent foreign currency transactions.
Foreign currency transaction gains and losses are included in determining net
income. All foreign currency transaction gains or losses in 1995 or 1996 were
attributable to the Mexican operations.
The Hungarian exchange rate used for the three months ended March 31, 1997 and
1996 were HUF 175.64 and HUF 146.72 respectively. The Mexican exchange rate used
for the three months ended March 31, 1997 and 1996 were MNP 7.9313 and MNP 7.5,
respectively.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
In connection with the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 (the "Reform Act"), the Company is hereby
providing cautionary statements identifying important factors that could cause
the Company's actual results to differ materially from those projected in
forward-looking statements (as such term is defined in the Reform Act) made by
or on behalf of the Company herein or orally, whether in presentations, in
response to questions or otherwise. Any statements that express, or involve
discussions as to expectations, beliefs, plans, objectives, assumptions or
future events or performance (often, but not always, through the use of words or
phrases such as "will result", "are expected to", "will continue", "is
anticipated", "estimated", "projection" and "outlook") are not historical facts
and may be forward-looking and, accordingly, such statements involve estimates,
assumptions, and uncertainties which could cause actual results to differ
materially from those expressed in the forward-looking statements. Such
uncertainties include, among other, the following: (i) the Company's ability to
obtain additional financing to implement its business strategy; (ii) real estate
investment risks, including the potential for increases in real property taxes;
(iii) real estate development risks, including obtaining building permits or
necessary zoning changes, construction delays strikes, adverse weather
conditions and other conditions beyond the control of the Company; (iv)
illiquidity of real estate investments; (v) the financial condition of the
Company's clients; (vi) imposition of new regulatory requirements affecting the
Company; (vii) a downturn in general or local economic conditions where the
Company owns real property; (viii) the delay or failure to properly manage
growth and successfully integrate acquired companies and operations; (ix) lack
of geographic diversification; (x) effect of uninsured loss and (ix) other
factors which are described in further detail in the Company's filings with the
Securities and Exchange Commission.
The Company cautions that actual results or outcomes could differ materially
from those expressed in any forward-looking statements made by or on behalf of
the Company. Any forward-looking statement speaks only as of the date on which
such statement is made, and the Company undertakes no obligation to update any
forward-looking statement or statements to reflect events or circumstances after
the date on which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time, and it is not
possible for management to predict all of such factors. Further, management
cannot assess
8
<PAGE> 10
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.
the impact of each such factor on the business or the extent to which any
factor, or combination of factors, may cause actual results to differ materially
from those contained in any forward-looking statements.
.
PART II: OTHER INFORMATION
ITEM 1: LEGAL PROCEEDINGS
None
ITEM 2: CHANGES IN 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
27.1 Financial Data Schedule (For SEC purposes only)
B. Reports on Form 8-K
None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
INTERNATIONAL REALTY GROUP, INC.
--------------------------------
(REGISTRANT)
DATE: DECEMBER 10, 1997 /S/ RICHARD M. BRADBURY
--------------------------------
RICHARD M. BRADBURY,
PRESIDENT, AND
CHIEF FINANCIAL OFFICER
9
<PAGE> 11
PART I: FINANCIAL INFORMATION, CONTINUED.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.
the impact of each such factor on the business or the extent to which any
factor, or combination of factors, may cause actual results to differ materially
from those contained in any forward-looking statements.
PART II: OTHER INFORMATION
ITEM 1: LEGAL PROCEEDINGS
None
ITEM 2: CHANGES IN 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
27.1 Financial Data Schedule (For SEC purposes only)
B. Reports on Form 8-K
None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
INTERNATIONAL REALTY GROUP, INC.
-----------------------------------------
(REGISTRANT)
DATE: DECEMBER 10, 1997 -----------------------------------------
RICHARD M. BRADBURY,
PRESIDENT, AND
CHIEF FINANCIAL OFFICER
10
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<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF INTERNATIONAL REALTY FOR THE THREE MONTHS ENDED MARCH
31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 31,200
<SECURITIES> 0
<RECEIVABLES> 154,000
<ALLOWANCES> 0
<INVENTORY> 10,556,100<F1>
<CURRENT-ASSETS> 0
<PP&E> 387,000
<DEPRECIATION> 225,800
<TOTAL-ASSETS> 13,366,100
<CURRENT-LIABILITIES> 1,121,800
<BONDS> 1,224,100
0
0
<COMMON> 10,000
<OTHER-SE> 9,680,200
<TOTAL-LIABILITY-AND-EQUITY> 13,366,100
<SALES> 0
<TOTAL-REVENUES> 177,100
<CGS> 0
<TOTAL-COSTS> 198,100
<OTHER-EXPENSES> 9,500
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 32,800
<INCOME-PRETAX> (48,900)
<INCOME-TAX> 0
<INCOME-CONTINUING> (48,900)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (48,900)
<EPS-PRIMARY> (.00)
<EPS-DILUTED> 0
<FN>
<F1>INVENTORY CONSISTS OF REAL ESTATE, AT COST CURRENTLY HELD FOR FUTURE
DEVELOPMENT.
</FN>
</TABLE>
