<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1996
-------------
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
------------ -------------
Commission File Number 0-20272
-------
RESOURCE CAPITAL GROUP, INC.
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 13-3617377
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
419 Crossville Road, Suite 204 Roswell, GA 30075
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(Address of principal executive offices) (Zip Code)
404-264-0600
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(Issuer's telephone number, including area code)
3400 Peachtree Road, NE Suite 1311 Atlanta, GA 30326
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the Exchange Act during the past 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. X Yes [ ] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Check whether the registrant filed all documents and reports required to be
filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
X Yes [ ] No
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of June 30, 1996, 416,748 shares of common stock of the Registrant were
outstanding.
<PAGE> 2
INDEX
RESOURCE CAPITAL GROUP, INC.
<TABLE>
<CAPTION>
Part I. Financial Information Page
Number
------
<S> <C> <C>
Item 1. Consolidated Financial Statements (Unaudited)
Consolidated Balance Sheet - June 30, 1996
and December 31, 1995 3
Consolidated Statement of Operations - For the
Three Months and Six Months Ended June 30,
1996 and 1995 4
Consolidated Statement of Cash Flows - For the
Six Months Ended June 30, 1996 and 1995 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis or
Plan of Operation 10
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K 13
</TABLE>
2
<PAGE> 3
Item 1. Consolidated Financial Statements
a) Consolidated Balance Sheet
RESOURCE CAPITAL GROUP, INC.
Consolidated Balance Sheet
(Unaudited)
<TABLE>
<CAPTION>
ASSETS
JUNE 30, DECEMBER 31,
1996 1995
------------ ------------
<S> <C> <C>
Cash and cash equivalents $ 876,433 $ 1,236,202
Investment in marketable equity securities-cat market 81,755 84,375
Investments in and receivables from partnerships (note 3) 2,660,893 2,579,375
Receivable from affiliated entity 225,000
Real and personal property, at cost
Land 633,845 458,035
Buildings and improvements 4,610,417 1,085,207
Furniture and equipment 670,092 68,217
------------ ------------
5,914,354 1,611,459
Less accumulated depreciation (68,602) (24,076)
------------ ------------
5,845,752 1,587,383
Deferred charges-net of accumulated amortization 510,966 20,114
Other assets 157,895 12,207
------------ ------------
$ 10,133,694 $ 5,744,656
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Note payable $ 183,664 $ 210,680
Accounts payable 115,219 23,214
Accrued expenses
Interest 35,280 3,877
Payroll 25,822 29,068
Professional fees 18,000 36,000
Taxes 39,984 50,412
Other 6,647 24,321
------------ ------------
125,733 143,678
Security deposits 63,892 12,625
Mortgage payable 4,960,256 355,486
Deferred tax liability 42,538 68,991
------------ ------------
Total Liabilities 5,491,302 814,674
Commitments and contingencies
Minority interest 100,199 283,181
Stockholders' equity
Common stock - authorized 1,000,000
$.01 par value per share, issued 498,608 4,986 4,986
Additional paid-in capital 4,459,034 4,459,034
Retained earnings 195,728 247,078
Less treasury stock, at cost, 82,130 shares (110,676) (60,543)
Unrealized (loss) on investment (6,879) (3,754)
------------ ------------
Total Stockholders' Equity 4,542,193 4,646,801
------------ ------------
$ 10,133,694 $ 5,744,656
============ ============
</TABLE>
See notes to consolidated financial statements
3
<PAGE> 4
b) Consolidated Statement of Operations
RESOURCE CAPITAL GROUP, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
JUNE 30 JUNE 30
------------------------ --------------------------
1996 1995 1996 1995
--------- --------- ----------- ----------
<S> <C> <C> <C> <C>
Income
Rental operations $ 223,247 $ 18,001 $ 282,846 $ 18,001
Interest - affiliated entity 53,146 74,381 106,291 394,832
Equity in earnings (loss) of
unconsolidated partnerships 2,391 211,211 (2,835) 710,848
Management fees - affiliated entity 15,000 15,000 30,000 30,000
Interest - investments 7,854 31,125 19,951 39,652
Gain on settlement of note entity 0 0 0 529,091
Other income 294 0 585 0
--------- --------- ----------- ----------
Total Income 301,932 349,718 436,838 1,722,424
--------- --------- ----------- ----------
Expenses
Rental operations 111,398 6,038 129,995 6,038
General and administrative 112,758 118,473 237,322 199,392
Interest 79,264 4,549 90,735 8,212
Depreciation and amortization 34,923 3,288 46,391 3,865
--------- --------- ----------- ----------
Total Expenses 338,343 132,348 504,443 217,507
--------- --------- ----------- ----------
Income (loss) before minority share of (income) (36,411) 217,370 (67,605) 1,504,917
Minority share of (income) (4,810) (2,100) (10,198) (2,100)
--------- --------- ----------- ----------
Income (loss) before income taxes (41,221) 215,270 (77,803) 1,502,817
(Provision for) benefit of income taxes (note 5) 14,015 (73,192) 26,453 (411,848)
--------- --------- ----------- ----------
Net income (loss) $ (27,206) $ 142,078 $ (51,350) $1,090,969
========= ========= =========== ==========
Net income (loss) per share $ (.06) $ .32 $ (.12) $ 2.46
========= ========= =========== ==========
</TABLE>
See notes to consolidated financial statements
4
<PAGE> 5
b) Consolidated Statement of Cash Flows
RESOURCE CAPITAL GROUP, INC.
Consolidated Statement of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
----------------------------
1996 1995
------------ -----------
<S> <C> <C>
Cash flows from operating activities
Net Income (loss) $ (51,350) $ 1,090,969
Adjustments to reconcile net income (loss) to net
cash provided by operating activites
Depreciation and amortization 46,391 3,865
Interest - affiliated entity 42,472
Equity in (earnings) loss of unconsolidated partnerships 2,835 (710,848)
Minority share of income (loss) 10,198 37,100
Changes in certain other accounts
Investment in marketable securities, net (505)
Accrued interest receivable 1,066,672
Deferred charges and other assets (638,405) (46,458)
Net deferred tax asset 265,406
Accounts payable 92,005 9,816
Accrued expenses (17,945) (11,631)
Income taxes (26,453) 146,442
Security deposit 51,267
------------ -----------
Net provided (used) by operating activities (489,490) 1,851,333
------------ -----------
Cash flows from investing activities
Additions to real and personal property (4,302,895) (439,399)
Deposits receivable (144,500)
Purchase of limited partner interest in
unconsolidated partnerships (39,325)
Repayments from (advances to) affiliated entity, net (87,500) 166,920
Receipt of notes and mortgage receivables from MLP 675,133
Receipt from affiliated entity 225,000
------------ -----------
Net cash provided (used) by investing activities (4,204,720) 258,154
------------ -----------
Cash flows from financing activities
Proceeds of mortgage payable 4,604,770 360,000
Receipt from minority interest 8,070
Payments on note payable (27,016) (19,723)
Purchase of treasury stock (50,133)
Distribution to minority interest (201,250)
------------ -----------
Net cash provided by financing activities 4,334,441 340,277
------------ -----------
Net increase (decrease) in cash and cash equivalents (359,769) 2,449,764
Cash and cash equivalents at beginning of period 1,236,202 64,595
------------ -----------
Cash and cash equivalents at end of period $ 876,433 $ 2,514,359
============ ===========
</TABLE>
See notes to consolidated financial statements
5
<PAGE> 6
RESOURCE CAPITAL GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
Readers of this quarterly report should refer to the Company's audited
financial statements for the year ended December 31, 1995 as certain footnote
disclosures which would substantially duplicate those contained in such audited
financial statements have been omitted from this report.
Note 1 Adjustments
In the opinion of management, the accompanying unaudited consolidated financial
statements contain all adjustments necessary to present the Company's financial
position, results of operations and cash flows for the periods indicated. Such
adjustments consisted only of normal recurring items.
Note 2 Summary of significant accounting policies
Principals of Consolidation
The consolidated financial statements of Resource Capital Group, Inc. have been
prepared in accordance with generally accepted accounting principles and
reflect the policies detailed below.
The consolidated financial statements of the Company include the accounts of
Resource Capital Group, Inc. and its seventy-five (75) percent owned
subsidiaries, 8050 Roswell Associates, LLC, (Roswell) and 419 Crossville
Associates, LLC (Crossville) and its ninety-nine (99) percent owned
subsidiaries, AGS Carriage House Associates (Carriage House) and AGS Compass
Pointe Associates (Compass Pointe). The remaining twenty-five (25) percent
ownership of Roswell and Crossville and one (1) percent ownership of Carriage
House and Compass Pointe is controlled by Hunter Management Company. All
intercompany transactions and balances have been eliminated in consolidation.
Note 3 Investment in and receivables from partnerships
The balances are summarized as follows:
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1996 1995
----------- ------------
<S> <C> <C>
Notes receivable from MLP $ 1,983,501 $ 1,983,501
Accrued interest receivable from MLP 24,794 24,794
Advances receivable from MLP 931,677 844,177
Accountability to partnerships (118,404) (73,097)
Purchase of limited partner
interest in AGS Carriage House/
AGS Compass Pointe 39,325
----------- -----------
2,860,893 2,779,375
Valuation allowance 200,000 200,000
----------- -----------
$ 2,660,893 $ 2,579,375
=========== ===========
</TABLE>
6
<PAGE> 7
In January 1995, MLP completed the sale of two of its properties, the Birchwood
and FoxFire Apartments. As a result of this sale, MLP repaid the Company
$942,581 covering the principal and accrued interest due on the Birchwood and
FoxFire notes receivable and a portion of the advances receivable due to the
Company. In addition, MLP refinanced the mortgage loans on Aspen Walk
Apartments and Rolling Hills Apartments on March 17, 1995. Cash proceeds of
$1,833,765 from this refinancing were sufficient to cover a substantial portion
of the remaining accrued interest receivable on the MLP notes, and the $600,000
mortgage note receivable (see note 4).
Interest income on these notes for the three months ended June 30, 1996
amounted to $74,381. Interest income reported for the corresponding period in
1995 was also $74,381.
Interest payments received on these notes for the three months ended June 30,
1996 and 1995 amounted to $74,381 for each period.
Based upon an evaluation of the Company's notes receivable from MLP, in 1995
management provided a $200,000 valuation allowance to reflect its estimate of
their realizability.
In 1996 the Company was assigned 23.825 limited partner units from existing
limited partners of AGS Compass Pointe Associates (Compass) for $23,825 and
15.5 limited partner units of AGS Carriage House Associates (Carriage) for
$15,500. These assignments represent 90.5% ownership of Compass and 73.6%
ownership of Carriage. In addition the Company acquired an additional 3.5%
limited partner interest in Compass and 20.4% limited partner interest in
Carriage from the non-participating limited partners.
Note 4 Mortgage note receivable - affiliated entity
In March 1995, the Company received $659,524 in full settlement of its $600,000
second mortgage note and accrued interest receivable due from MLP. This note,
which carried a face value of $600,000 along with accrued interest thereon and
54,317 shares of its common stock was purchased from a finance company in 1993
for $100,000. The Company carried the note on its books at its cost basis of
$70,909 and accordingly reflected a gain of $529,091 in the 1995 statement of
operations. Interest income on this note for the three months ended March 31,
1995 amounted to $62,524.
7
<PAGE> 8
Note 5 Acquisition of properties
In 1995 the Company purchased 75% interests in both Roswell and Crossville,
each of which was accounted for as a purchase. The entire purchase price was
allocated to real and personal property since this amount was less than the
fair value of the properties. The remaining 25% interest in each entity was
purchased by Hunter Management Company (Hunter). Hunter provides management
services to Roswell, Crossville and the Company's Partnership investees.
Additionally, the sole shareholder of Hunter is a minority shareholder of the
Company.
The purchase price for Roswell approximated $440,000 of which $330,000 was
contributed by the Company with the remaining $110,000 being contributed by
Hunter. Operations of Roswell have been included in the Company's 1995
financial statements since May 1995. The purchase price of Crossville
approximated $1,000,000, of which the Company contributed $750,000 while Hunter
contributed $250,000. Of the $250,000 contributed by Hunter, $225,000 was
advanced by the Company. Operations of Crossville have been included in the
Company's 1995 financial statements since November, 1995.
In June 1995, Roswell obtained a mortgage in the amount of $360,000 and with
the proceeds returned $247,500 to the Company and $82,500 to Hunter. In
addition, in May, 1996 Crossville obtained a mortgage in the amount of $880,000
and with the proceeds returned $600,000 to the Company (75%) and $200,000 to
Hunter (25%). Proceeds returned to Hunter were used to satisfy the $225,000
advance from the Company.
The Following summarized, unaudited pro forma results of operations for the
three months and six months ended June 30, 1995 assumes both the Roswell and
Crossville acquisitions occurred January 1, 1995:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1995 June 30, 1995
------------- -------------
<S> <C> <C>
Rental operating income $ 64,251 $ 118,591
Net income 166,879 1,130,660
Net income per share .38 2.55
</TABLE>
On March 15, 1996 the Company entered into a contract to purchase the Colonial
Park Commons for $1,210,000. This property is located in Fulton County,
Georgia and consists of an 18,387 square foot office building and two building
lots. A $128,500 deposit has been escrowed by the Company pending the closing
of this transaction. The purchase is conditional upon the Company obtaining a
first mortgage on the property in the amount of $1,028,000.
In 1996, both AGS Carriage House and AGS Compass Pointe Associates expanded
their Partnerships to raise additional capital. In that regard the Company
acquired an additional 94% interest in and
8
<PAGE> 9
contributed $23,825 to AGS Compass Pointe Associates and acquired an additional
94% interest in and contributed $15,500 to AGS Carriage House Associates.
Hunter acquired the remaining 1% interest in AGS Compass Pointe and AGS
Carriage House.
Note 6 Income Taxes
The provision for income taxes of $73,192 for the three months ended June 30,
1995 is based on the tax obtained by applying the statutory rate to the taxable
income earned in the period. In 1996 the Company recorded a tax benefit of
$14,015 for the three months ended June 30, 1996.
Note 7 Mortgages Payable
In May, 1996 Crossville obtained a $880,000 mortgage payable which matures June
1, 2011. Required monthly payments of $8,821 are applied first to interest at
8.8% with the balance to reduction of principal. Interest on this loan adjusts
every five years and is computed at 3.25 basis points over the average yield on
U.S. Treasury Securities, as defined. The mortgage payable has been guaranteed
by both the Company and Hunter.
In 1996, the Company contributed $443,500 to AGS Carriage House Associates and
$355,500 to AGS Compass Pointe Associates. These amounts combined with
partnership cash was used primarily to reduce the long term debt of the
Partnerships. The terms of the mortgages payable for those two properties are
as follows:
<TABLE>
<CAPTION>
Balance
June 30, 1996
-------------
<S> <C>
9 3/4% mortgage payable to a bank,
secured by a first deed of trust on
Compass Pointe Apartments payable in
equal monthly installments of principal
and interest of $15,753 until maturity
on December 1, 2023. $1,810,938
9 3/4 % mortgage payable to a bank,
secured by a first deed of trust on
Carriage House Apartments payable in
equal monthly installments of principal
and interest of $16,812 until maturity
on December 1, 2023. $1,932,699
</TABLE>
These loans are non recourse to the Company.
9
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Liquidity and Capital Resources
The Company's liquidity is based primarily on its cash reserves, real estate
investment income, ability to obtain mortgage financing, plus the interest
income and loan repayments received on its notes receivable from its affiliate,
AGS Partners MLP, L.P. (MLP). These funds are used to pay the Company's normal
operating expenses and fund new acquisitions.
As of June 30, 1996, the Company had cash reserves of $876,433. For the six
months ended June 30, 1996, the advances receivable from MLP increased $87,500
for major capital improvements. This amount will be refunded to the Company by
MLP from escrows held by the first mortgage lender and other reserves. The
Company's cash reserves and current level of income are sufficient to meet the
Company's current level of operating expenses on an ongoing basis.
Occupancy levels and rental rates have increased substantially over the past 3
years. The net operating income at the property levels combined with MLP
reserves are presently sufficient to make full interest payments to the
Company. In the past, the Company allowed MLP to defer interest payments to
make capital improvements, replacements and upgrades to the individual
apartment units, buildings and mechanical systems. As a result of this
program, in January, 1995 MLP successfully sold two of its properties, the
Birchwood and FoxFire Apartments at a substantial profit and refinanced in
March, 1995 Aspen Walk and Rolling Hills Apartments.
During the three months ended June 30, 1996, the Company received $74,381 in
interest income from MLP. The ultimate realization of the Company's investment
in and receivable from MLP is dependent on the future operations and/or sale of
the MLP properties. However based on 1996 and future budgets and recent
property valuations, management believes that the two remaining MLP properties
have potential for future operating cash flows and future re-sale values.
None-the- less in 1995 management decided to make a valuation allowance against
the MLP notes of $200,000.
The operating properties of the MLP and the various other real estate
partnerships in which the Company is the general partner are financed with
non-recourse debt. The Company is not liable for the principal or interest on
the mortgages and the other assets of the partnerships are more than adequate
to satisfy other recourse liabilities. Therefore, the Company's liquidity
should not be adversely affected by these general partner obligations.
10
<PAGE> 11
In May 1995, the Company acquired for $330,000 a 75% interest in 8050 Roswell
Associates, LLC (Roswell) a Georgia limited liability Company which owns a
9,000 square foot office building in Atlanta, Georgia. Hunter Management
Company owns the remaining 25% interest. The purchase price for Roswell
approximated $440,000 and was financed, in part, with a $360,000 mortgage on
the building. The Company was repaid $247,500 in capital from the proceeds of
the mortgage. Based on 1996 and future budgets and recent property valuations
the investment should produce future operating cash flows and future resale
values for the Company.
In November, 1995 the Company purchased a 75% interest in 419 Crossville
Associates, LLC (Crossville) a Georgia limited liability Company which owns a
19,000 square foot office building in Roswell, Fulton County, Georgia. Hunter
Management Company owns the remaining 25% interest. The Company advanced
$225,000 to Hunter for this acquisition. The building was purchased in an all
cash transaction, however, in May, 1996 Crossville closed an $880,000 mortgage
on the property and used the proceeds to return $600,000 in capital to the
Company and $200,000 in capital to Hunter. Proceeds returned to Hunter were
used to satisfy the $225,000 advance from the Company. Based on 1996 and
future budgets and recent property valuations, the investment should produce
future operating cash flows and future resale values for the Company.
For the three months ended June 30, 1996 the Company received 15,000 in fees
from Hunter Management Company for management supervisory services provided in
connection with the various MLP properties.
In March 1996, the Company submitted an earnest money deposit in the amount of
$128,500 for the purchase of a 18,387 square foot office building and two
building lots in Roswell, Georgia for $1,210,000. The purchase of the building
is conditioned upon the Company, at its option, obtaining a first mortgage on
the property in the amount of $1,028,000. However, the Company is only seeking
$800,000 in mortgage financing and does not intend to encumber the building
lots.
The Company is the General Partner and also a Limited Partner of AGS Carriage
House Associates and AGS Compass Pointe Associates. In 1996, the Company
expanded both partnerships to raise additional capital. In this regard the
Company has contributed $799,000 to these two properties and has obtained a 94%
limited partner interest in the partnerships. Hunter contributed $8,070 in
capital and has obtained a 1% limited partner interest. The capital was
utilized by the partnerships to satisfy debt requirements.The investment should
produce future operating cash flows and future resale values for the Company.
11
<PAGE> 12
Results of Operations
The Company's business plan includes a transition from its current asset base
of mortgage receivables from MLP and general and limited partner interests in
apartment buildings located throughout the country, into small apartment
properties and suburban office buildings concentrated in Atlanta, Georgia and
other fast growing metropolitan areas in the southeast. Consistent with this
transition, for the three months ended June 30, 1996, the Company recognized a
loss of $27,206 compared to income of $142,078 for the corresponding period in
1995. Total revenue for the three months ended June 30, 1996 was $301,932
versus $349,718 for the same period in 1995. This decrease in revenue was
caused substantially by the decrease in income from MLP from the 1995 sale of
Birchwood and Foxfire Apartments and the 1995 refinance of Rolling Hills and
Aspen Walk Apartments. Rental income increased $205,246 in 1996 due to the May
1995 acquisition of Roswell and the November 1995 acquisition of Crossville and
the 1996 acquisition of Carriage House and Compass Pointe.
Total expenses for the three months ended June 30, 1996 were $338,343 compared
to $132,348 for the same period in 1995. The increase in expenses from 1996 to
1995 was caused by the rental operating expenses incurred from the acquisition
of Roswell and Crossville in 1995 and Carriage House and Compass Pointe in
1996.
General and administrative expenses for the three months ended June 30, 1996 of
$112,758 decreased $5,715 from the same period last year. The decrease is
attributable to additional professional fees incurred in 1995 from the
participation in the HUD Auction of non performing loans in March, 1995.
In 1996, consistent with its business plan, the Company acquired 94% of the
ownership interest in Carriage House and Compass Pointe Apartments. As a
result, depreciation and amortization of $34,923 for the three months ended
June 30, 1996 increased $31,635 from the same period in 1995 due to the
acquisition of Carriage House and Compass Pointe in 1996 and Roswell and
Crossville in 1995.
Interest expense increased $74,715 for the three months ended June 30, 1996 as
compared to the corresponding period in 1995 due to the amortization of the
mortgage payable obtained on the Roswell and Crossville acquisition in 1995 and
Carriage House and Compass acquisition in 1996.
Inflation
Inflation in the future may increase rental revenues as well as operating
expenses, all in accordnace with general market trends.
12
<PAGE> 13
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - 27 Financial Data Schedule (for SEC use only)
(b) Reports - None
13
<PAGE> 14
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the
Registrant caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Resource Capital Group, Inc.
(Registrant)
By: /s/Albert G. Schmerge III
-------------------------
Albert G. Schmerge III
President, CEO and
Chairman of the Board
Date: August 14, 1996
14
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 876,433
<SECURITIES> 81,755
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 5,914,354
<DEPRECIATION> 68,602
<TOTAL-ASSETS> 10,133,694
<CURRENT-LIABILITIES> 0
<BONDS> 4,960,256
0
0
<COMMON> 4,986
<OTHER-SE> 4,537,207
<TOTAL-LIABILITY-AND-EQUITY> 10,133,694
<SALES> 0
<TOTAL-REVENUES> 436,838
<CGS> 0
<TOTAL-COSTS> 129,995
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 90,735
<INCOME-PRETAX> (77,803)
<INCOME-TAX> 26,453
<INCOME-CONTINUING> (51,350)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (51,350)
<EPS-PRIMARY> (.12)
<EPS-DILUTED> 0
</TABLE>
