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<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 0-25606
-------------------------------------------------------
WELLS REAL ESTATE FUND VII
- -----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Georgia 58-2022629
- --------------------------------------- --------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
6200 The Corners Pkwy., 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
--- ___
<PAGE>
FORM 10-Q
WELLS REAL ESTATE FUND VII, L.P.
(A Georgia Public Limited Partnership)
INDEX
<TABLE>
<CAPTION>
Page No.
--------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<S> <C>
Balance Sheets--March 31, 2000 and December 31, 1999 3
Statements of Income for the Three Months Ended March 31, 2000 4
and 1999
Statements of Partners' Capital for the Year Ended December 31, 1999 5
and the Three Months Ended March 31, 2000
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 19
</TABLE>
-2-
<PAGE>
WELLS REAL ESTATE FUND VII, L.P.
(A Georgia Public Limited Partnership)
BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
---------- -------------
ASSETS:
<S> <C> <C>
Investment in joint ventures (Note 2) $17,209,476 $17,446,299
Due from affiliates 480,206 465,908
Cash and cash equivalents 91,039 81,697
----------- -----------
Total assets $17,780,721 $17,993,904
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL:
Liabilities:
Accounts payable $ 2,829 $ 1,929
Partnership distributions payable 471,886 458,148
----------- -----------
Total liabilities 474,715 460,077
----------- -----------
Partners' capital:
Limited partners:
Class A--2,040,767 units and 2,036,267 units as of March 31, 17,145,791 17,125,194
2000 and December 31, 1999, respectively
Class B--377,250 units and 381,750 units as of March 31, 2000
and December 31, 1999, respectively 160,215 408,633
----------- -----------
Total partners' capital 17,306,006 17,533,827
----------- -----------
Total liabilities and partners' capital $17,780,721 $17,993,904
=========== ===========
</TABLE>
See accompanying condensed notes to financial statements.
-3-
<PAGE>
WELLS REAL ESTATE FUND VII, L.P.
(A Georgia Public Limited Partnership)
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Three Months Ended
--------------------------
March 31, March 31,
2000 1999
--------- ---------
REVENUES:
<S> <C> <C>
Equity in income of joint ventures (Note 2) $ 268,384 $ 240,775
Interest income 554 1,639
--------- ---------
268,938 242,414
--------- ---------
EXPENSES:
Legal and accounting 12,782 5,740
Partnership administration 12,091 21,454
Amortization of organization costs 0 1,562
--------- ---------
24,873 28,756
--------- ---------
NET INCOME $ 244,065 $ 213,658
========= =========
NET INCOME ALLOCATED TO CLASS A LIMITED PARTNERS $ 487,666 $ 454,393
========= =========
NET LOSS ALLOCATED TO CLASS B LIMITED PARTNERS $(243,601) $(240,735)
========= =========
NET INCOME PER WEIGHTED AVERAGE CLASS A LIMITED PARTNER UNIT $ 0.24 $ 0.23
========= =========
NET LOSS PER WEIGHTED AVERAGE CLASS B LIMITED PARTNER UNIT $ (0.65) $ (0.60)
========= =========
CASH DISTRIBUTION PER WEIGHTED AVERAGE CLASS A LIMITED PARTNER UNIT $ 0.23 $ 0.21
========= =========
</TABLE>
See accompanying condensed notes to financial statements.
-4-
<PAGE>
WELLS REAL ESTATE FUND VII, 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 Amounts Units Amounts Partners Capital
----------- ----------- ------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
BALANCE, December 31, 1998 2,009,517 $ 16,935,935 408,500 $1,452,035 $0 $18,387,970
Net income (loss) 0 1,879,410 0 (983,615) 0 895,795
Partnership distributions 0 (1,749,938) 0 0 0 (1,749,938)
Class B conversion elections 26,750 59,787 (26,750) (59,787) 0 0
--------- ------------ ------- ---------- -------- -----------
BALANCE, December 31, 1999 2,036,267 17,125,194 381,750 408,633 0 17,533,827
Net income (loss) 0 487,666 0 (243,601) 0 244,065
Partnership distributions 0 (471,886) 0 0 0 (471,886)
Class B conversion elections 4,500 4,817 (4,500) (4,817) 0 0
--------- ------------ ------- ---------- -------- -----------
BALANCE, March 31, 2000 2,040,767 $17,145,791 377,250 $ 160,215 $0 $17,306,006
========= ============ ======= ========== ======== ===========
</TABLE>
See accompanying condensed notes to financial statements.
-5-
<PAGE>
WELLS REAL ESTATE FUND VII, L.P.
(A Georgia Public Limited Partnership)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Three Months Ended
------------------------
March 31, March 31,
2000 1999
---------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income $ 244,065 $ 213,658
--------- ---------
Adjustments to reconcile net income to net cash used in operating
activities:
Equity in income of joint ventures (268,384) (240,775)
Amortization of organization costs 0 1,562
Changes in assets and liabilities:
Prepaids and other assets 0 1,517
Accounts payable 901 (3,863)
--------- ---------
Total adjustments (267,483) (241,559)
--------- ---------
Net cash used in operating activities (23,418) (27,901)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Distributions received from joint ventures 490,909 414,719
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Partnership distributions paid (458,149) (403,832)
--------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 9,342 (17,014)
CASH AND CASH EQUIVALENTS, beginning of year 81,697 75,740
--------- ---------
CASH AND CASH EQUIVALENTS, end of period $ 91,039 $ 58,726
========= =========
</TABLE>
See accompanying condensed notes to financial statements.
-6-
<PAGE>
WELLS REAL ESTATE FUND VII, L.P.
(A Georgia Public Limited Partnership)
CONDENSED NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2000
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) General
Wells Real Estate Fund VII, 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 December 1, 1992, for the
purpose of acquiring, developing, owning, operating, improving, leasing,
and otherwise managing for investment purposes income-producing commercial
properties.
On April 6, 1994, the Partnership commenced an offering of up to
$25,000,000 of Class A or Class B limited partnership units ($10 per unit)
pursuant to a Registration Statement on Form S-11 filed under the
Securities Act of 1933. The Partnership commenced active operations when it
received and accepted subscriptions for a minimum of 125,000 units on April
26, 1994. The Partnership terminated its offering on January 5, 1995, and
received gross proceeds of $24,180,174 representing subscriptions from
1,910 Limited Partners.
The Partnership owns equity interests in properties through ownership in
the following joint ventures: (i) Fund V, Fund VI, and Fund VII Associates,
a joint venture between the Partnership, Wells Real Estate Fund V, L.P.,
and Wells Real Estate Fund VI, L.P. (the "Fund V-VI-VII Joint Venture");
(ii) Fund VI and Fund VII Associates, a joint venture between the
Partnership and Wells Real Estate Fund VI, L.P. (the "Fund VI-Fund VII
Joint Venture"); (iii) Fund II, III, VI, and VII Associates, a joint
venture among the Partnership, Wells Fund II-III Joint Venture and Wells
Real Estate Fund VI, L.P. (the "Fund II-III-VI-VII Joint Venture"); (iv)
Fund VII and Fund VIII Associates, a joint venture between the Partnership
and Wells Real Estate Fund VIII, L.P. (the "Fund VII-Fund VIII Joint
Venture"); (v) Fund VI, Fund VII, and Fund VIII Associates, a joint venture
between the Partnership, Wells Real Estate Fund VI, L.P., and Wells Real
Estate Fund VIII, L.P. (the "Fund VI-VII-VIII Joint Venture"); and (vi)
Fund I, II, II-OW, VI, and VII Associates, a joint venture between the
Partnership, Wells Real Estate Fund I, the Fund II and Fund II-OW Joint
Venture, and Wells Real Estate Fund VI, L.P. (the "Fund I, II, II-OW, VI,
and VII Joint Venture").
As of March 31, 2000, the Partnership owned interests in the following
properties through its ownership of the foregoing joint ventures: (i) a
three-story office building located in Appleton, Wisconsin (the "Marathon
Building"); (ii) two retail buildings located in Stockbridge, Georgia
("Stockbridge Village III"); (iii) a retail shopping center expansion in
Stockbridge, Georgia ("Stockbridge Village I Expansion"); (iv) an
office/retail center located in Roswell, Georgia ("Holcomb Bridge Road
Property"); (v) a retail center located in Stockbridge, Georgia (the
"Hannover Center"); (vi) a four-story office building located in
Jacksonville, Florida (the "BellSouth Property"); (vii) an office building
located in Gainesville, Florida ("CH2M Hill at Gainesville Property");
(viii) a retail center in Clemmons, North Carolina ("Tanglewood Commons");
and (ix) a retail center located in Cherokee County, Georgia ("Cherokee
Commons").
-7-
<PAGE>
(b) Basis of Presentation
The consolidated financial statements of Wells Real Estate Fund VII, L.P.
(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. INVESTMENTS IN JOINT VENTURES
The Partnership owns interests in nine properties through its ownership in
joint ventures of which three are office buildings and six are retail
centers. 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 a description of the joint ventures and properties owned by the
Partnership, please refer to 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 Section 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 the expiration of existing leases, and the potential need
to fund tenant improvements or other capital expenditures out of operating
cash flow.
1. RESULTS OF OPERATIONS AND CHANGES IN FINANCIAL CONDITIONS
General
As of March 31, 2000, the developed properties owned by the Partnership
were 96.9% occupied, as compared to 96.5% occupied as of March 31, 1999.
Gross revenues of the Partnership increased to $268,938 for the three
months ended March 31, 2000 from $242,414 for the three months ended March
31, 1999 due to increased occupancy at Cherokee Commons and Tanglewood
Commons. Total expenses decreased slightly for the three months ended March
31, 2000 as compared to the same period in 1999 due to decreases in
administrative salary.
Net income per weight average Unit for Class A Limited Partners was $.24
for the three months ended March 31, 2000 as compared to $.23 for the three
months ended March 31, 1999. Net loss per weighted
-8-
<PAGE>
average Unit for Class B and converted Class A Limited Partners was $.65
for the three months ended March 31, 2000 as compared to $.60 for the three
months ended March 31, 1999.
Cash distributions per weighted average Unit for Class A Limited Partners
was $.23 for the three months ended March 31, 2000 as compared to $.21 for
the three months ended March 31, 1999. No cash distributions were made by
the Partnership to the Limited Partners holding Class B Units or to the
General Partner. The Partnership anticipates that distributions will
continue to be paid on a quarterly basis on a level at least consistent
with 1999.
The Partnership's net cash provided by investing activities and net cash
used in financing activities increased in 2000, compared to 1999, due to
increases in distributions from joint ventures as occupancy increased.
The Partnership expects to continue to meet 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 from operations.
-9-
<PAGE>
2. PROPERTY OPERATIONS
As of March 31, 2000, the Partnership owned interest in the following
operational properties:
The Marathon Building/Fund V-VI-VII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31, March 31,
2000 1999
---------- ---------
<S> <C> <C>
Revenues:
Rental income $242,763 $242,754
---------- ---------
Expenses:
Depreciation 87,646 87,646
Management and leasing expenses 2,361 16,244
Other operating expenses 4,966 7,546
---------- ---------
94,973 111,436
---------- ---------
Net income $147,790 $131,318
========== =========
Occupied percentage 100% 100%
========== =========
Partnership's ownership percentage in the Fund V-VI-VII Joint Venture 41.7% 41.7%
========== =========
Cash distributions to the Partnership $ 99,096 $ 92,229
========== =========
Net income allocated to the Partnership $ 61,630 $ 54,773
========== =========
</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 starting
October 1999 when this single tenant's lease became a triple net lease.
Operating expenses decreased due primarily to decreases in accounting fees.
-10-
<PAGE>
Stockbridge Village III/Fund VI-Fund VII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
--------------------------
March 31, March 31,
2000 1999
---------- ----------
<S> <C> <C>
Revenues:
Rental income $76,838 $80,601
---------- ----------
Expenses:
Depreciation 21,408 22,586
Management and leasing expenses 9,577 5,556
Other operating expenses (979) 2,967
---------- ----------
30,006 31,109
---------- ----------
Net income $46,832 $49,492
========== ==========
Occupied percentage 100% 100%
========== ==========
Partnership's ownership percentage in the Fund VI-Fund VII Joint Venture 56.3% 56.3%
========== ==========
Cash distributions to the Partnership $39,574 $37,472
========== ==========
Net income allocated to the Partnership $26,366 $27,863
========== ==========
</TABLE>
Rental income, net income, and cash distributions to the Partnership remained
relatively stable for 2000, as compared to 1999, due to the stable occupancy
rate.
-11-
<PAGE>
Stockbridge Village I Expansion/Fund VI-Fund VII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
--------------------------
March 31, March 31,
2000 1999
---------- ----------
<S> <C> <C>
Revenues:
Rental income $82,747 $78,146
---------- ----------
Expenses:
Depreciation 37,151 41,555
Management and leasing expenses 11,360 9,290
Other operating expenses 4,179 4,791
---------- ----------
52,690 55,636
---------- ----------
Net income $30,057 $22,510
========== ==========
Occupied percentage 86% 86%
========== ==========
Partnership's ownership percentage in the Fund VI-Fund VII Joint Venture 56.3% 56.3%
========== ==========
Cash distributions to the Partnership $40,327 $40,124
========== ==========
Net income allocated to the Partnership $16,922 $12,673
========== ==========
</TABLE>
Rental income and net income increased for the three months ended March 31, 2000
as compared to three months ended March 31, 1999 due to increased rental renewal
rates this year.
Cash distributions to the Partnership remained the same even though net income
increased due to lease acquisition fees paid on lease renewals in 2000.
-12-
<PAGE>
Holcomb Bridge Road Property/Fund II-III-VI-VII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31, March 31,
2000 1999
============ ============
Revenues:
<S> <C> <C>
Rental income $ 222,157 $ 230,063
------------ ------------
Expenses:
Depreciation 104,130 94,129
Management and leasing expenses 30,586 38,874
Other operating expenses 17,218 24,394
------------ ------------
151,934 157,397
------------ ------------
Net income $ 70,223 $ 72,666
============ ============
Occupied percentage 100% 100%
============ ============
Partnership's ownership percentage in the Fund II-III-VI-VII Joint
Venture 49.1% 49.1%
============ ============
Cash distributions to the Partnership $ 93,668 $ 72,205
============ ============
Net income allocated to the Partnership $ 34,458 $ 35,657
============ ============
</TABLE>
Rental income and net income decreased for the three months ended March 31, 2000
as compared to the three months ended March 31, 1999 due to a straight line rent
adjustment during the first quarter of 1999.
Cash distributions to the Partnership increased even though net income decreased
slightly due to lease acquisition fees paid of approximately $20,000 in 1999.
-13-
<PAGE>
The Hannover Center/Fund VII-Fund VIII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31, March 31,
2000 1999
============ ============
Revenues:
<S> <C> <C>
Rental income $ 26,644 $ 56,147
------------ ------------
Expenses:
Depreciation 21,204 10,981
Management and leasing expenses 4,360 7,459
Other operating expenses 10,397 3,417
------------ ------------
35,961 21,857
------------ ------------
Net (loss) income $ (9,317) $ 34,290
============ ============
Occupied percentage 50% 100%
============ ============
Partnership's ownership percentage in the Fund VII-Fund VIII Joint
Venture 36.7% 36.7%
============ ============
Cash distribution to the Partnership $ 0 $ 14,876
============ ============
Net (loss) income allocated to the Partnership $ (3,415) $ 12,567
============ ============
</TABLE>
Rental income and net income decreased for the three months ended March 31, 2000
as compared to the three months ended March 31, 1999 due to one tenant who
defaulted on the lease and moved out at the end of 1999. The management team is
currently taking legal action against that tenant.
Management and leasing fees decreased due to decreases in rental income.
Management and leasing fees are charges based on rental income received.
Operating expenses increased due to increases in legal fees.
There is no cash distribution to the Partnership for the three months ended
March 31, 2000 due to a net loss allocated to the Partnership.
-14-
<PAGE>
CH2M Hill at Gainesville/Fund VII-Fund VIII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31, March 31,
2000 1999
============ ============
Revenues:
<S> <C> <C>
Rental income $ 144,035 $ 143,856
------------ ------------
Expenses:
Depreciation 65,941 68,946
Management and leasing expenses 23,987 26,881
Other operating expenses (21,421) 17,352
------------ ------------
68,507 113,179
------------ ------------
Net income $ 75,528 $ 30,677
============ ============
Occupied percentage 100% 100%
============ ============
Partnership's ownership percentage in the Fund VII-Fund VIII Joint
Venture 36.7% 36.7%
============ ============
Cash distributions to the Partnership $ 52,608 $ 35,587
============ ============
Net income allocated to the Partnership $ 27,681 $ 11,243
============ ============
</TABLE>
Rental income remained relatively stable for the three months ended March 31,
2000 as compared to the three months ended March 31, 1999.
Net income and cash distributions to the Partnership increased in 2000, as
compared to 1999, due to an increase in common area maintenance reimbursements
billed in 2000 to the tenants. Tenants are billed an estimated amount for the
current year common area maintenance which is then reconciled the following year
and the difference billed to the tenant.
-15-
<PAGE>
BellSouth Property/Fund VI-VII-VIII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31, March 31,
2000 1999
============ ============
Revenues:
<S> <C> <C>
Rental income $ 380,277 $ 380,277
Interest income 1,289 1,142
------------ -------------
381,566 381,419
------------ -------------
Expenses:
Depreciation 111,606 111,606
Management and leasing expenses 48,166 47,892
Other operating expenses 104,332 103,784
------------ -------------
264,104 263,282
------------ -------------
Net income $ 117,462 $ 118,137
============ =============
Occupied percentage 100% 100%
============ =============
Partnership's ownership percentage in the Fund VI-VII-VIII Joint
Venture 33.4% 33.4%
============ =============
Cash distributions to the Partnership $ 79,295 $ 79,509
============ =============
Net income allocated to the Partnership $ 39,232 $ 39,452
============ =============
</TABLE>
Rental income, net income, and cash distributions to the Partnership remained
relatively stable for the three months ended March 31, 2000 as compared to the
three months ended March 31, 1999 due to the stable occupancy rate.
-16-
<PAGE>
Tanglewood Commons/Fund VI-VII-VIII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31, March 31,
2000 1999
============ ============
Revenues:
<S> <C> <C>
Rental income $ 205,489 $ 193,031
Interest income 2,365 2,936
------------ ------------
207,854 195,967
------------ ------------
Expenses:
Depreciation 65,096 61,425
Management and leasing expenses 17,775 15,105
Other operating expenses (25,333) 19,081
------------ ------------
57,538 95,611
------------ ------------
Net income $ 150,316 $ 100,356
============ ============
Occupied percentage 97% 91%
============ ============
Partnership's ownership percentage in the Fund VI-VII-VIII Joint
Venture 33.4% 33.4%
============ ============
Cash distributions to the Partnership $ 73,314 $ 54,324
============ ============
Net income allocated to the Partnership $ 50,206 $ 33,514
============ ============
</TABLE>
Rental income, net income, and cash distributions to the Partnership increased
for the three months ended March 31, 2000 as compared to the three months ended
March 31, 1999 due to increased occupancy at the property.
Other operating expenses decreased due to an increase in common area maintenance
reimbursements billed to tenants. Tenants are billed an estimated amount for the
current year common area maintenance which is then reconciled the following year
and the difference billed to the tenant.
-17-
<PAGE>
Cherokee Commons/Fund I, II, II-OW, VI, and VII Joint Venture
<TABLE>
<CAPTION>
Three Months Ended
---------------------------
March 31, March 31,
2000 1999
============ ============
Revenues:
<S> <C> <C>
Rental income $ 242,861 $ 227,383
Interest income 7 20
------------ ------------
242,868 227,403
------------ ------------
Expenses:
Depreciation 110,562 110,112
Management and leasing expenses 16,355 26,135
Other operating expenses (26,968) (30,556)
------------ ------------
99,949 105,691
------------ ------------
Net income $ 142,919 $ 121,712
============ ============
Occupied percentage 97% 96%
============ ============
Partnership's ownership percentage in the Fund I, II, II-OW, VI, and
VII Joint Venture 10.7% 10.7%
============ ============
Cash distributions to the Partnership $ 27,548 $ 24,360
============ ============
Net income allocated to the Partnership $ 15,304 $ 13,033
============ ============
</TABLE>
Rental income increased in 2000 as compared to 1999 due to increased occupancy
and increased rental revenue rates. Management and leasing expenses decreased in
2000, as compared to 1999, due to increased leasing commissions for 1999 and a
catch-up of 1998 management fees in 1999. Other operating expenses remain
negative for 2000 and 1999 due to timing differences in the billing of common
area maintenance to tenants. Tenants are billed an estimate amount for the
current year common area maintenance which is then reconciled in the following
year and the difference billed to the tenant.
-18-
<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 VII, L.P.
(Registrant)
Dated: May 11, 2000 By: /s/ Leo F. Wells, III
---------------------
Leo F. Wells, III, as Individual
General Partner, and as President,
and Chief Financial Officer of
Wells Capital, Inc., the General
Partner of Wells Partners, L.P.
-19-
<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> 91,039
<SECURITIES> 17,209,476
<RECEIVABLES> 480,206
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 17,780,721
<CURRENT-LIABILITIES> 474,715
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 17,306,006
<TOTAL-LIABILITY-AND-EQUITY> 17,780,721
<SALES> 0
<TOTAL-REVENUES> 268,938
<CGS> 0
<TOTAL-COSTS> 24,873
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 244,065
<INCOME-TAX> 0
<INCOME-CONTINUING> 244,065
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 244,065
<EPS-BASIC> 0.24
<EPS-DILUTED> 0
</TABLE>
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