August 10, 1999
Securities and Exchange Commission
Filer Support, Edgar
Operation Center, Stop 0-7
6432 General Green Way
Alexandria, VA 22312
Boston Financial Tax Credit Fund VIII, A Limited Partnership
Report on Form 10-QSB Edgar for Quarter Ended June 30, 1999
File Number 0-26522
Dear Sir/Madam:
Pursuant to the requirements of Section 15(d) of the Securities Exchange Act
of 1934, filed herewith is a copy of subject report.
Very truly yours,
/s/Stephen Guilmette
Stephen Guilmette
Assistant Controller
TC8-Q1.DOC
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1999
---------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
For Quarter Ended June 30, 1999 Commission file number 0-26522
----------------------- -------------
Boston Financial Tax Credit Fund VIII, A Limited Partnership
(Exact name of registrant as specified in its charter)
Massachusetts 04-3205879
(State or other jurisdiction of (I.R.S. EmployerIdentification No.)
incorporation or organization)
101 Arch Street, Boston, Massachusetts 02110-1106
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 439-3911
------------------------
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>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION Page No.
Item 1. Financial Statements
Balance Sheet (Unaudited) - June 30, 1999 1
Statements of Operations (Unaudited) - For the Three
Months Ended June 30, 1999 and 1998 2
Statement of Changes in Partners' Equity (Deficiency) (Unaudited) -
For the Three Months Ended June 30, 1999 3
Statements of Cash Flows (Unaudited) - For the Three
Months Ended June 30, 1999 and 1998 4
Notes to Financial Statements (Unaudited) 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6
PART II - OTHER INFORMATION
Items 1-6 9
SIGNATURE 10
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
BALANCE SHEET
June 30, 1999
(Unaudited)
<TABLE>
<CAPTION>
Assets
<S> <C>
Cash and cash equivalents $ 158,547
Investments in Local Limited Partnerships (Note 1) 22,582,703
Marketable securities, at fair value 1,592,743
Other assets 14,433
---------------
Total Assets $ 24,348,426
===============
Liabilities and Partners' Equity
Accounts payable to affiliate $ 387,644
Accrued expenses 38,061
---------------
Total Liabilities 425,705
General, Initial and Investor Limited Partners' Equity 23,934,094
Net unrealized losses on marketable securities (11,373)
Total Partners' Equity 23,922,721
---------------
Total Liabilities and Partners' Equity $ 24,348,426
===============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months Ended June 30, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
------------- -------------
Revenue:
<S> <C> <C>
Investment $ 22,739 $ 23,208
Other 800 750
------------- -------------
Total Revenue 23,539 23,958
------------- -------------
Expenses:
Asset management fees, related party 51,555 50,765
General and administrative (includes reimbursements
to an affiliate in the amounts of $20,190 and
$18,073 in 1999 and 1998, respectively) 35,686 42,814
Amortization 7,486 9,986
------------- -------------
Total Expenses 94,727 103,565
------------- -------------
Loss before equity in losses
of Local Limited Partnerships (71,188) (79,607)
Equity in losses of Local Limited Partnerships (Note 1) (486,254) (439,835)
------------- -------------
Net Loss $ (557,442) $ (519,442)
============= =============
Net Loss allocated:
To General Partners $ (5,574) $ (5,194)
To Limited Partners (551,868) (514,248)
------------- -------------
$ (557,442) $ (519,442)
============= =============
Net Loss per Limited Partnership Unit
(36,497 Units) $ (15.12) $ (14.09)
============= =============
The accompanying notes are an integral part of these
financial statements.
</TABLE>
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIENCY)
(Unaudited)
For the Three Months Ended June 30, 1999
<TABLE>
<CAPTION>
Net
Initial Investor Unrealized
General Limited Limited Gains
Partner Partner Partners (Losses) Total
<S> <C> <C> <C> <C> <C>
Balance at March 31, 1999 $ (71,432) $ 100 $ 24,562,868 $ 1,053 $ 24,492,589
----------- --------- -------------- ----------- -------------
Comprehensive Loss:
Net change in net unrealized gains
on marketable securities
available for sale - - - (12,426) (12,426)
Net Loss (5,574) - (551,868) - (557,442)
----------- --------- -------------- ----------- -------------
Comprehensive Loss (5,574) - (551,868) (12,426) (569,868)
----------- --------- -------------- ----------- -------------
Balance at June 30, 1999 $ (77,006) $ 100 $ 24,011,000 $ (11,373) $ 23,922,721
=========== ========= ============== =========== =============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
For the Three Months Ended June 30, 1999 and 1998
<TABLE>
<CAPTION>
1999 1998
------------- -------------
<S> <C> <C>
Net cash used for operating activities $ (30,707) $ (33,164)
Net cash provided by investing activities 9,224 16,858
------------- -------------
Net decrease in cash and cash equivalents (21,483) (16,306)
Cash and cash equivalents, beginning of period 180,030 213,966
------------- -------------
Cash and cash equivalents, end of period $ 158,547 $ 197,660
============= =============
</TABLE>
The accompanying notes are an integral part of these
financial statements.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
The unaudited financial statements presented herein have been prepared in
accordance with the instructions to Form 10-QSB and do not include all of the
information and note disclosures required by generally accepted accounting
principles. These statements should be read in conjunction with the financial
statements and notes thereto included with the Fund's Form10-K for the year
ended March 31, 1999. In the opinion of management, these financial statements
include all adjustments, consisting only of normal recurring adjustments,
necessary to present fairly the Fund's financial position and results of
operations. The results of operations for the periods may not be indicative of
the results to be expected for the year.
The Managing General Partner has elected to report results of the Local Limited
Partnerships on a 90 day lag basis, because the Local Limited Partnerships
report their results on a calendar year basis. Accordingly, the financial
information about the Local Limited Partnerships that is included in the
accompanying financial statements is as of March 31, 1999 and 1998.
1. Investments in Local Limited Partnerships
The Fund has acquired limited partnership interests in ten Local Limited
Partnerships, which own and operate multi-family housing complexes. The Fund, as
Investor Limited Partner, pursuant to the Local Limited Partnership Agreements,
has acquired a 99% interest in the profits, losses, tax credits and cash flows
from operations of the Local Limited Partnerships, with the exception of
Springwood, Hemlock Ridge, Pike Place and West End Place, which are 79.20%, 77%,
90% and 90%, respectively. Another partnership sponsored by an affiliate of the
General Partner owns the remaining 19.80% limited partnership interest in
Springwood. Upon dissolution, proceeds will be distributed according to the
partnership agreements.
The following is a summary of Investments in Local Limited Partnerships at June
30, 1999:
<TABLE>
<CAPTION>
<S> <C>
Capital Contributions paid to Local Limited Partnerships $ 29,264,859
Cumulative equity in losses of Local Limited Partnerships (7,281,033)
Cumulative cash distributions received from
Local Limited Partnerships (330,758)
Investments in Local Limited Partnerships before adjustment 21,653,068
Excess of investment cost over the underlying net assets acquired:
Acquisition fees and expenses 1,048,010
Accumulated amortization of acquisition fees and expenses (118,375)
-------------
Investments in Local Limited Partnerships $ 22,582,703
=============
</TABLE>
The Fund's share of net losses of the Local Limited Partnerships for the three
months ended June 30, 1999 is $486,254.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Certain matters discussed herein constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The Fund
intends such forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements and are including this statement for
purposes of complying with these safe harbor provisions. Although the Fund
believes the forward-looking statements are based on reasonable assumptions, the
Fund can give no assurance that their expectations will be attained. Actual
results and timing of certain events could differ materially from those
projected in or contemplated by the forward-looking statements due to a number
of factors, including, without limitation, general economic and real estate
conditions, interest rates and unanticipated delays or expenses on the part of
the Fund and their suppliers in achieving year 2000 compliance.
Liquidity and Capital Resources
At June 30, 1999, the Fund had cash and cash equivalents of $158,547 as compared
to $180,030 at March 31, 1999. This decrease is attributable to purchases of
marketable securities in excess of proceeds from sales and maturities of
marketable securities and cash used for operations. These decreases are offset
by cash distributions received from Local Limited Partnerships.
As of June 30, 1999, approximately $1,326,000 of marketable securities has been
designated as Reserves. The Reserves were established to be used for working
capital of the Fund and contingencies related to the ownership of Local Limited
Partnership interests. Management believes that the interest income earned on
Reserves, along with cash distributions received from Local Limited
Partnerships, to the extent available, will be sufficient to fund the Fund's
ongoing operations. Reserves may be used to fund operating deficits, if the
General Partner deems funding appropriate.
Since the Fund invests as a limited partner, the Fund has no contractual duty to
provide additional funds to Local Limited Partnerships beyond its specified
investment. Thus, as of June 30, 1999, the Fund had no contractual or other
obligation to any Local Limited Partnership which had not been paid or provided
for, except as disclosed above.
In the event a Local Limited Partnership encounters operating difficulties
requiring additional funds, the Fund might deem it in its best interest to
voluntarily provide such funds in order to protect its investment. No such event
has occurred to date.
Cash Distributions
No cash distributions were made during the three months ended June 30, 1999. It
is expected that cash available for distribution, if any, will not be
significant in fiscal year 2000. As funds from temporary investments are paid to
Local Limited Partnerships, interest earnings on those funds decrease. In
addition, some of the properties benefit from some type of federal or state
subsidy and, as a consequence, are subject to restrictions on cash
distributions.
Results of Operations
For the three months ended June 30, 1999, the Fund's operations resulted in a
net loss of $557,442, as compared to $519,442 for the three months ended June
30, 1998. The increase in net loss is primarily attributable to an increase in
equity in losses of Local Limited Partnerships due to a decrease in rental
income at some properties where occupancy has decreased.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
Property Discussions
The Fund owns limited partnership interests in 9 Local Limited Partnerships
which own and operate multi-family residential properties. The Fund also owns
investments in securities in which its Reserves are held.
Four of the Local Limited Partnerships are operating at deficits (net loss
adjusted for depreciation, mortgage principal payments and replacement reserve
payments). In past years, the Local General Partners funded these deficits
either through non-interest bearing project expense loans or subordinated loans,
repayable only out of cash flow or proceeds from a sale or refinancing of the
given project. Once a project achieves break-even, substantial amounts of cash
flow derived from its operations will be used to repay project expense loans and
subordinated loans until the loans are repaid in full. To address current
deficits or other financial difficulties, Local General Partners are working to
increase rental income and reduce operating expenses, working with the lenders
to refinance property mortgages or seeking other sources of capital. Management
may make voluntary advances from the Partnership's
Reserves to a Local Limited Partnership encountering operating difficulties if
it is deemed to be in the best interest of the Fund to provide such funds.
As previously reported, the Local General Partner of Chelsea Village
successfully negotiated a refinancing 1998. It is not expected that the
refinancing will generate taxable income to the partnership.
As previously reported, the Local General Partner of Woods of Castleton
successfully refinanced the mortgage in the third quarter of 1997. The Managing
General Partner completed negotiations with the Local General Partner and agreed
to a modification of the Partnership Agreement in conjunction with the
refinancing. This modification granted the Local General Partner the potential
cash and residual benefits from the property in exchange for their input of the
capital required to complete the refinancing transaction. The modification also
includes provisions that allow the Fund to exit from its interest in the Local
Limited Partnership which owns the Property at a time of its choosing. The
Managing General Partner believes that these concessions will have no material
affect on the Fund in the future given the current value of the property.
Impact of Year 2000
The Managing General Partner's plan to resolve year 2000 issues involves the
following four phases: assessment, remediation, testing and implementation. To
date, the Managing General Partner has fully completed an assessment of all
information systems that may not be operative subsequent to 1999 and has begun
the remediation, testing and implementation phase on both hardware and software
systems. Because the hardware and software systems of both the Fund and Local
Limited Partnerships are generally the responsibility of obligated third
parties, the plan primarily involves ongoing discussions with and obtaining
written assurances from these third parties that pertinent systems will be 2000
compliant. In addition, neither the Fund nor the Local Limited Partnerships are
incurring significant additional costs since such expenses are principally
covered under the service contracts with vendors. As of August 1999, the General
Partner is in the final stages of its year 2000 remediation plan and believes
all major systems are compliant; any systems still being updated are not
considered significant to the Partnership's operations. However, despite the
likelihood that all significant year 2000 issues are expected to be resolved in
a timely manner, the Managing General Partner has no means of ensuring that all
systems of outside vendors or other entities that impact operations will be 2000
compliant. The Managing General Partner does not believe that the inability of
third parties to address their year 2000 issues in a timely manner will have a
material impact on the Fund. However, the effect of non-compliance by third
parties is not readily determinable.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
Impact of Year 2000 (continued)
Management has also evaluated a worst case scenario projection with respect to
the year 2000 and expects any resulting disruption of either the Managing
General Partner's activities or any Local Limited Partnership's operations to be
short-term inconveniences. Such problems, however, are not likely to fully
impede the ability to carry out necessary duties of the Fund. Moreover, because
expected problems under a worst case scenario are not extensively detrimental
and, because the likelihood that all systems affecting the Fund will be
compliant in early 1999, the Managing General Partner has determined that a
formal contingency plan that responds to material system failures is not
necessary
Other Development
Lend Lease Real Estate Investments, Inc., the U.S. subsidiary of Lend Lease
Corporation and the leading U.S. institutional real estate advisor as ranked by
assets under management, announced on July 29, 1999 it has reached a memorandum
of understanding to acquire The Boston Financial Group Limited Partnership. The
transaction remains subject to final due diligence, legal agreements, and
regulatory approvals with no guarantee that the acquisition will be completed.
The two companies are targeting to complete the transactions by the end of
September.
Headquarters in New York and Atlanta, Lend Lease Real Estate Investments, Inc.
has regional offices in 12 cities nationwide. Worldwide, Lend Lease Real Estate
Investments operates from more than 30 cities on five continents: North America,
Europe, Asia, Australia and South America. The company ranks as the leading U.S.
manager of tax-exempt assets invested in real estate. It is a subsidiary of Lend
Lease Corporation, an international real estate and financial services group
listed on the Australian Stock Exchange. In addition to real estate investments,
the Lend Lease Group operates in the areas of property development, project
management and construction, and capital services (infrastructure). Financial
services activities include funds management, life insurance, and wealth
protection.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
PART II OTHER INFORMATION
Items 1-5 Not applicable
Item 6 Exhibits and reports on Form 8-K
(a) Exhibits - None
(b) Reports on Form 8-K - No reports on Form 8-K were filed
during the quarter ended June 30, 1999.
<PAGE>
BOSTON FINANCIAL TAX CREDIT FUND VIII
(A Limited Partnership)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DATED: August 10, 1999 BOSTON FINANCIAL TAX CREDIT FUND VIII,
A LIMITED PARTNERSHIP
By: Arch Street VIII Limited Partnership,
its General Partner
/s/Randolph G. Hawthorne
Randolph G. Hawthorne
Managing Director, Vice President
and Chief Operating Officer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-END> JUN-30-1999
<CASH> 158,547
<SECURITIES> 1,592,743
<RECEIVABLES> 000
<ALLOWANCES> 000
<INVENTORY> 000
<CURRENT-ASSETS> 000
<PP&E> 000
<DEPRECIATION> 000
<TOTAL-ASSETS> 24,348,426<F1>
<CURRENT-LIABILITIES> 000
<BONDS> 000
000
000
<COMMON> 000
<OTHER-SE> 23,922,721
<TOTAL-LIABILITY-AND-EQUITY> 24,348,426<F2>
<SALES> 000
<TOTAL-REVENUES> 23,539<F3>
<CGS> 000
<TOTAL-COSTS> 000
<OTHER-EXPENSES> 94,727<F4>
<LOSS-PROVISION> 000
<INTEREST-EXPENSE> 000
<INCOME-PRETAX> 000
<INCOME-TAX> 000
<INCOME-CONTINUING> 000
<DISCONTINUED> 000
<EXTRAORDINARY> 000
<CHANGES> 000
<NET-INCOME> (557,442)<F5>
<EPS-BASIC> (15.12)
<EPS-DILUTED> 000
<FN>
<F1>Included in Total assets is Investments in Local Limited Partnerships of
$22,582,703 and Other assets of $14,433.
<F2>Total liability and equity includes Accounts payable to affiliate of
$387,644 and Accrued expenses of $38,061.
<F3>Total revenue includes Investment of $22,739 and Other of $800.
<F4>Included in Other expenses is Asset management fees, related party of
$51,555, General and administrative of $35,686 and Amortization of $7,486.
<F5>Net loss includes Equity in losses of Local Limited Partnerships of
$486,254.
</FN>
</TABLE>
