Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Jun. 30, 2015 | |
Document and Entity Information: | ||
Entity Registrant Name | REAL ESTATE ASSOCIATES LTD II | |
Document Type | 10-K | |
Document Period End Date | Dec. 31, 2015 | |
Amendment Flag | false | |
Entity Central Index Key | 314,237 | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 10,507 | |
Entity Public Float | $ 0 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | FY | |
Trading Symbol | real2 |
Balance Sheets
Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
ASSETS | ||
Cash and cash equivalents | $ 512 | $ 601 |
Accounts Receivable - Limited Partners | 103 | 103 |
Total assets | 615 | 704 |
Liabilities: | ||
Accounts payable and accrued expenses | 21 | 20 |
Total Liabilities | 21 | 20 |
Partners' capital (deficiency) | ||
General partners | (136) | (135) |
Limited partners | 730 | 819 |
Total partners' capital (deficiency) | 594 | 684 |
Total liabilities and partners' capital (deficiency) | $ 615 | $ 704 |
Statements of Operations
Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Operating Expenses: | ||
Management fees - General Partner | $ 7 | $ 8 |
General and administrative | 60 | 31 |
Legal and accounting | 27 | 51 |
Total operating expenses | 94 | 90 |
Loss from partnership operations | (94) | (90) |
Distribution in excess of investment in Local Limited Partnership | 4 | 5 |
Net income (loss) | (90) | (85) |
Net income (loss) allocated to general partners (1%) | (1) | (1) |
Net income (loss) allocated to limited partners (99%) | $ (89) | $ (84) |
Net Income (Loss) per limited partnership interest | $ (8.47) | $ (7.99) |
Statements of Changes in Partne
Statements of Changes in Partners' Capital (Deficiency) - USD ($) $ in Thousands | General Partners | Limited Partners | Total |
Partners' capital (deficiency), beginning balance at Dec. 31, 2013 | $ (134) | $ 903 | $ 769 |
Net loss | (1) | (84) | (85) |
Partners' capital (deficiency), ending balance at Dec. 31, 2014 | (135) | 819 | 684 |
Net loss | (1) | (89) | (90) |
Partners' capital (deficiency), ending balance at Dec. 31, 2015 | $ (136) | $ 730 | $ 594 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (90) | $ (85) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Distributions in excess of investments | (4) | (5) |
Change in accounts: | ||
Change in Accounts Receivable - Limited Partners | (78) | |
Change in Accounts payable and accrued expenses | 1 | (2) |
Net cash provided by (used in) operating activities | (93) | (170) |
Cash flows provided by (used in) investing activities: | ||
Distributions in excess of investments | 4 | 5 |
Net cash provided by (used in) investing activities | 4 | 5 |
Cash flows provided by (used) in financing activities: | ||
Net decrease in cash and cash equivalents | (89) | (165) |
Cash and cash equivalents, beginning of period | 601 | 766 |
Cash and cash equivalents, end of period | $ 512 | $ 601 |
Note 1 - Organization and Summa
Note 1 - Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Notes | |
Note 1 - Organization and Summary of Significant Accounting Policies | NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Real Estate Associates Limited II (the Partnership) was formed under the California Limited Partnership Act on December 4, 1979. The Partnership was formed to invest in other limited partnerships which own and operate primarily federal, state or local government-assisted housing projects. The general partners are National Partnership Investments Associates, a California limited partnership, and National Partnership Investments, LLC, a California limited liability company (NAPICO or the General Partner). The business of the Partnership is conducted primarily by NAPICO. The General Partner is a subsidiary of Bethesda Holdings II, LLC, a privately held real estate asset management company (Bethesda). Bethesda acquired the General Partner on December 19, 2012, pursuant to an option agreement with Aimco/Bethesda Holdings, Inc., a subsidiary of Apartment Investment and Management Company (Aimco), a publicly traded real estate investment trust. The general partners share a one percent interest in profits and losses of the Partnership. The limited partners share the remaining 99 percent interest in proportion to their respective investments. The Partnership shall be dissolved only upon the expiration of 52 complete calendar years (December 31, 2031) from the date of the formation of the Partnership or the occurrence of various other events as specified in the terms of the Partnership Agreement. Upon total or partial liquidation of the Partnership or the disposition or partial disposition of a project or project interest and distribution of the proceeds, the general partners will be entitled to a liquidation fee as stipulated in the Partnership agreement. The limited partners will have a priority return equal to their invested capital attributable to the project(s) or project interest(s) sold. The general partners' liquidation fee may accrue but shall not be paid until the limited partners have received distributions equal to 100 percent of their capital contributions. No such fees were accrued or paid during the years ended December 31, 2015 and 2014. Basis of Presentation The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Method of Accounting for Investment in Local Limited Partnership The investment in the local limited partnership (the Local Limited Partnership) is accounted for using the equity method. Abandoned Units During 2015 and 2014, the number of Limited Partnership Interests decreased by zero and seven interests, respectively, due to limited partners abandoning their interests. At December 31, 2015 and 2014, the Partnership had outstanding 10,507 Limited Partnership Interests. In abandoning his or her Limited Partnership Interest(s), a limited partner relinquishes all right, title, and interest in the partnership as of the date of abandonment. Net Income (loss) and Distribution Per Limited Partnership Interest Net income (loss) per limited partnership interest and distribution per limited partnership interest were computed by dividing the limited partners share of net income (loss) and distributions by the number of limited partnership interests outstanding at the beginning of the year. The number of limited partnership interests used was 10,507 and 10,514 for the years ended December 31, 2015 and 2014, respectively. Cash and Cash Equivalents Cash and cash equivalents include cash on hand and in bank accounts. At certain times, the amount of cash deposited at a bank may exceed the limit on insured deposits. Impairment of Long-Lived Assets The Partnership reviews its investments in long-lived assets to determine if there have been any impairments whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. If the sum of the expected future cash flows is less than the carrying amount of the assets, the Partnership recognizes an impairment loss. There were no impairment losses recognized during the years ended December 31, 2015 and 2014. Segment Reporting Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 280-10, Segment Reporting, established standards for the way that public business enterprises report information about operating segments in annual financial statements and requires that those enterprises report selected information about operating segments in interim financial reports. ASC Topic 280-10 also established standards for related disclosures about products and services, geographic areas and major customers. As defined in ASC Topic 280-10, the Partnership has only one reportable segment. Fair Value of Financial Instruments ASC Topic 825, Financial Instruments, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate fair value. Fair value is defined as the amount at which the instruments could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The Partnership believes that the carrying amounts of other assets and liabilities reported on the balance sheet at December 31, 2015 that require such disclosure approximated their fair value due to the short-term maturity of these instruments. Variable Interest Entities The Partnership consolidates any variable interest entities in which the Partnership holds a variable interest and is the primary beneficiary. Generally, a variable interest entity, or VIE, is an entity with one or more of the following characteristics: (a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional subordinated financial support; (b) as a group the holders of the equity investment at risk lack (i) the ability to make decisions about an entitys activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests and substantially all of the entitys activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. The primary beneficiary of a VIE is generally the entity that has (a) the power to direct the activities of the VIE that most significantly impact the VIEs economic performance, and (b) the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. In determining whether it is the primary beneficiary of a VIE, the Partnership considers qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIEs economic performance and which party controls such activities; the amount and characteristics of the Partnerships investment; the obligation or likelihood for the Partnership or other investors to provide financial support; and the similarity with and significance to the business activities of the Partnership and the other investors. Significant judgments related to these determinations include estimates about the current and future fair values and performance of real estate held by these VIEs and general market conditions. At December 31, 2015 and 2014, the Partnership held variable interests in one VIE, for which the Partnership was not the primary beneficiary. The Partnership has concluded, based on its qualitative consideration of the partnership agreement, the partnership structure and the role of the general partner in the Local Limited Partnership, that the general partner of the Local Limited Partnership is the primary beneficiary of the respective Local Limited Partnership. In making this determination, the Partnership considered the following factors: · · · · · · The VIE at December 31, 2015 consists of a Local Limited Partnership that is directly engaged in the ownership and management of one apartment property with a total of 48 units. The Partnership is involved with the VIE as a non-controlling limited partner equity holder. The Partnerships maximum exposure to loss as a result of its involvement with the unconsolidated VIE is limited to the Partnerships recorded investments in and receivables from the VIE, which was zero at both December 31, 2015 and 2014. The Partnership may be subject to additional losses to the extent of any financial support that the Partnership voluntarily provides in the future . |
Note 2 - Investments in and Adv
Note 2 - Investments in and Advances To Local Limited Partnerships | 12 Months Ended |
Dec. 31, 2015 | |
Notes | |
Note 2 - Investments in and Advances To Local Limited Partnerships | NOTE 2 INVESTMENTS IN AND ADVANCES TO THE LOCAL LIMITED PARTNERSHIP As of December 31, 2015 and 2014, the Partnership holds limited partnership interests in one Local Limited Partnership. As of December 31, 2015, the Local Limited Partnership owns a residential low income rental project consisting of 48 apartment units. The mortgage loans of the project are payable to or insured by various governmental agencies. The Partnership, as a limited partner, does not have a contractual relationship with the Local Limited Partnership or exercise control over the activities and operations, including refinancing or selling decisions, of the Local Limited Partnership that would require or allow for consolidation. Accordingly, the Partnership accounts for its investment in the Local Limited Partnership using the equity method. The Partnership is allocated profits and losses of the Local Limited Partnership based upon its respective ownership percentage of 99%. Distributions of surplus cash from operations from the Local Limited Partnership are restricted by the Local Limited Partnerships Regulatory Agreements with the United States Department of Housing and Urban Development (HUD) and/or are restricted by the terms of the mortgages encumbering the Projects. These restrictions limit the distribution to a portion, generally less than 10%, of the initial invested capital. The excess surplus cash is deposited into a residual receipts reserve, of which the ultimate realization by the Partnership is uncertain as HUD frequently retains it upon sale or dissolution of the Local Limited Partnership. The Partnership is allocated profits and losses and receives distributions from refinancings and sales in accordance with the Local Limited Partnerships partnership agreements. These agreements usually limit the Partnerships distributions to an amount substantially less than its ownership percentage in the Local Limited Partnership. The individual investments are carried at cost plus the Partnerships share of the Local Limited Partnerships profits less the Partnerships share of the Local Limited Partnerships losses, distributions and impairment charges. The Partnership is not legally liable for the obligations of the Local Limited Partnership and is not otherwise committed to provide additional support to them. Therefore, it does not recognize losses once its investment in each of the Local Limited Partnership reaches zero. Distributions from the Local Limited Partnerships are accounted for as a reduction of the investment balance until the investment balance is reduced to zero. When the investment balance has been reduced to zero, subsequent distributions received are recognized as income in the accompanying statements of operations. Operating distributions from the Local Limited Partnerships in which the Partnerships investment in the Local Limited Partnerships has been reduced to zero were approximately $4,000 and $5,000 for the years ended December 31, 2015 and 2014, respectively. At times, advances are made to the Local Limited Partnership. Advances made by the Partnership to the Local Limited Partnership are considered part of the Partnerships investment in the limited partnership. Advances made to Local Limited Partnership for which the investment has been reduced to zero are generally charged to expense. While not obligated to make advances to the Local Limited Partnership, the Partnership made this advance in order to protect its economic investment in the Local Limited Partnership. There were no advances made during the years ended December 31, 2015 and 2014, respectively. For investments where the Partnership has determined that the carrying value of its investment approximates the estimated fair value of the investment, the Partnerships policy is to recognize equity in income of the Local Limited Partnership only to the extent of distributions received and amortization of acquisition costs from the Local Limited Partnership. Therefore, the Partnership limits its recognition of equity earnings to the amount it expects to ultimately realize. The Partnership has no carrying value in the investment in Local Limited Partnership as of December 31, 2015 and 2014. The difference between the investment per the accompanying balance sheets at December 31, 2015 and 2014 and the partners deficiency per the Local Limited Partnerships condensed combined financial statements is due primarily to cumulative unrecognized equity in losses of the Local Limited Partnership, costs capitalized to the investment account, cumulative distributions recognized as income and recognition of impairment losses. Although the Partnerships recorded value of its investments and its equity in distributions from the Local Limited Partnership are not individually material to the overall financial position of the Partnership, the unaudited condensed combined balance sheets of the aforementioned Local Limited Partnership as of December 31, 2015 and 2014, and the unaudited condensed combined results of operations for each of the two years in the periods ended December 31, 2015 and 2014 are as follows: Condensed Combined Balance Sheets of the Local Limited Partnership December 31, 2015 2014 (in thousands unaudited) Assets: Land $ 102 $ 102 Buildings and improvements 2,108 2,108 Accumulated depreciation 1,781 (1,755) Other assets 439 394 Total Assets $ 868 $ 849 Liabilities and Partners Deficiency: Liabilities: Mortgage notes payable $ 1,401 $ 1,435 Other liabilities 81 108 Total Liabilities 1,482 1,543 Partners Deficiency (614) (694) Total Liabilities & Partners' Deficiency $ 868 $ 849 Condensed Combined Results of Operations of the Local Limited Partnership Years Ended December 31, 2015 2014 (in thousands unaudited) Revenues Rental income $ 443 $ 430 Other income 28 14 Total revenues 471 444 Expenses Depreciation and amortization 28 31 Interest 56 57 Operating 303 317 Total expenses 387 405 Income (loss) from continuing operations $ 84 $ 39 Real Estate and Accumulated Depreciation of the Local Limited Partnership The following unaudited data is a summary of real estate, accumulated depreciation and encumbrances of the Local Limited Partnership. (in thousands-unaudited) Description Encumbrances Land Buildings and Related Personal Property Total Accumulated Depreciation Date of Construction Lakeside Apartments $ 1,401 $ 102 $ 2,108 $ 2,210 $ 1,781 10/80-6/81 Reconciliation of real estate (unaudited) Years Ended December 31, 2015 2014 (in thousands) Balance at beginning of year $ 2,210 $ 2,208 Additions during the year -- 2 Disposal of property -- -- Balance at end of year $ 2,210 $ 2,210 Reconciliation of accumulated depreciation (unaudited) Years Ended December 31, 2015 2014 (in thousands) Balance at beginning of year $ 1,755 $ 1,726 Disposal of property -- -- Depreciation expense for the year 26 29 Balance at end of year $ 1,781 $ 1,755 The current policy of the United States Department of Housing and Urban Development (HUD) is to not renew the Housing Assistance Payment (HAP) Contracts on a long term basis on the existing terms. In connection with renewals of the HAP Contracts under current law and policy, the amount of rental assistance payments under renewed HAP Contracts will be based on market rentals instead of above market rentals, which may not be the case under existing HAP Contracts. The payments under the renewed HAP Contracts may not be in an amount that would provide sufficient cash flow to permit owners of properties subject to HAP Contracts to meet the debt service requirements of existing loans insured by the Federal Housing Administration of HUD (FHA) unless such mortgage loans are restructured. In order to address the reduction in payments under HAP Contracts as a result of current policy, the Multi-family Assisted Housing Reform and Affordability Act of 1997 (MAHRAA) provides for the restructuring of mortgage loans insured by the FHA with respect to properties subject to the Section 8 program. Under MAHRAA, an FHA-insured mortgage loan can be restructured into a first mortgage loan which will be amortized on a current basis and a low interest second mortgage loan payable to FHA which will only be payable on maturity of the first mortgage loan. This restructuring results in a reduction in annual debt service payable by the owner of the FHA-insured mortgage loan and is expected to result in an insurance payment from FHA to the holder of the FHA-insured loan due to the reduction in the principal amount. MAHRAA also phases out project-based subsidies on selected properties serving families not located in rental markets with limited supply, converting such subsidies to a tenant-based subsidy. When the HAP Contracts are subject to renewal, there can be no assurance that the Local Limited Partnerships in which the Partnership has an investment will be permitted to restructure its mortgage indebtedness under MAHRAA. In addition, the economic impact on the Partnership of the combination of the reduced payments under the HAP Contracts and the restructuring of the existing FHA-insured mortgage loans under MAHRAA is uncertain. |
Note 3 - Transactions With Affi
Note 3 - Transactions With Affiliated Parties | 12 Months Ended |
Dec. 31, 2015 | |
Notes | |
Note 3 - Transactions With Affiliated Parties | NOTE 3 TRANSACTIONS WITH AFFILIATED PARTIES Under the terms of the Restated Certificate and Agreement of Limited Partnership, the Partnership is liable to NAPICO for an annual management fee equal to 0.4 percent of the Partnerships original remaining invested assets of the Local Limited Partnerships and is calculated at the beginning of each year. Invested assets are defined as the costs of acquiring project interests, including the proportionate amount of the mortgage loans related to the Partnerships interests in the capital accounts of the respective partnerships. The fee was approximately $7,000 and $8,000 for the years ended December 31, 2015 and 2014, respectively. Additionally, the Partnership reimburses NAPICO for expenses incurred by NAPICO on behalf of the Partnership but paid by NAPICO for convenience. These reimbursed expenses were approximately $47,000 and $44,000 for the years ended December 31, 2015 and 2014, respectively. Bethesda Holdings II, LLC (Bethesda) and its affiliates owned 178 units or 356 limited partnership interests in the Partnership representing 3.39% of the outstanding limited partnership interests in the Partnership at December 31, 2015. It is possible that Bethesda or its affiliates will acquire additional limited partnership interests in the Partnership, either through private purchases or tender offers. Pursuant to the Partnership Agreement, unit holders holding a majority of the limited partnership interests are entitled to take action with respect to a variety of matters that include, but are not limited to, voting on certain amendments to the Partnership Agreement and voting to remove the General Partner. A Unit consists of two limited partnership interests. Bethesda has entered into a management agreement with a holder of 870 Units or 1,740 limited partnership interests in the Partnership representing 16.56% of the outstanding limited partnership interests in the Partnership as of December 31, 2015. Pursuant to such management agreement, Bethesda manages the business of such holder in exchange for a management fee, part of which includes all payments received by such holder with respect to such holders ownership of limited partnership interests in the Partnership. Although the General Partner owes fiduciary duties to the limited partners of the Partnership, the General Partner also owes fiduciary duties to Bethesda as its sole stockholder. As a result, the duties of the General Partner, as corporate general partner, to the Partnership and its limited partners may come into conflict with the duties of the General Partner to Bethesda as its sole stockholder. |
Note 4 - Income Taxes
Note 4 - Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Notes | |
Note 4 - Income Taxes | NOTE 4 INCOME TAXES The Partnership is not taxed on its income. The partners are taxed in their individual capacities based upon their distributive share of the Partnership's taxable income or loss and are allowed the benefits to be derived from off-setting their distributive share of the tax losses against taxable income from other sources subject to passive loss limitations. The taxable income or loss differs from amounts included in the statements of operations because different methods are used in determining the losses of the Local Limited Partnerships as discussed below. A reconciliation is as follows: Years Ended December 31, 2015 2014 (in thousands) Net income per financial statements $ (90) $ (85) Partnerships share of Local Limited Partnership 87 25 Income per tax return $ (3) $ (60) Income per limited partnership interest $ (.29) $ (5.64) The following is a reconciliation between the Partnerships reported amounts and the Federal tax basis of net assets (in thousands): December 31, 2015 December 31,2014 (in thousands) (in thousands) Net assets as reported $ 594 $ 684 (Deduct) add: Investment in Partnerships (1,542) (1,648) Deferred offering costs 1,443 1,443 Receivable from affiliates 2,094 2,094 Net assets Federal tax basis $ 2,589 $ 2,573 |
Note 5 - Contingencies
Note 5 - Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Notes | |
Note 5 - Contingencies | NOTE 5 CONTINGENCIES The General Partner is involved in various lawsuits arising from transactions in the ordinary course of business. In the opinion of management and the General Partner, the claims will not result in any material liability to the Partnership. |
Note 6 - Distribution
Note 6 - Distribution | 12 Months Ended |
Dec. 31, 2015 | |
Notes | |
Note 6 - Distribution | NOTE 6 DISTRIBUTION During the year ended December 31, 2015 and 2014, the Partnership made no distributions to the limited partners. |
Note 7 - Subsequent Event
Note 7 - Subsequent Event | 12 Months Ended |
Dec. 31, 2015 | |
Notes | |
Note 7 - Subsequent Event | NOTE 7 - SUBSEQUENT EVENTS The Partnerships management evaluated subsequent events through the time this Annual Report on Form 10-K was filed. |
Note 1 - Organization and Sum13
Note 1 - Organization and Summary of Significant Accounting Policies: Basis of Presentation (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Basis of Presentation | Basis of Presentation The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States. |
Note 1 - Organization and Sum14
Note 1 - Organization and Summary of Significant Accounting Policies: Use of Estimates (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Note 1 - Organization and Sum15
Note 1 - Organization and Summary of Significant Accounting Policies: Method of Accounting For Investment in Local Limited Partnerships (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Method of Accounting For Investment in Local Limited Partnerships | Method of Accounting for Investment in Local Limited Partnership The investment in the local limited partnership (the Local Limited Partnership) is accounted for using the equity method. |
Note 1 - Organization and Sum16
Note 1 - Organization and Summary of Significant Accounting Policies: Abandoned Units (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Abandoned Units | Abandoned Units During 2015 and 2014, the number of Limited Partnership Interests decreased by zero and seven interests, respectively, due to limited partners abandoning their interests. At December 31, 2015 and 2014, the Partnership had outstanding 10,507 Limited Partnership Interests. In abandoning his or her Limited Partnership Interest(s), a limited partner relinquishes all right, title, and interest in the partnership as of the date of abandonment. |
Note 1 - Organization and Sum17
Note 1 - Organization and Summary of Significant Accounting Policies: Net Income and Distribution Per Limited Partnership Interest (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Net Income and Distribution Per Limited Partnership Interest | Net Income (loss) and Distribution Per Limited Partnership Interest Net income (loss) per limited partnership interest and distribution per limited partnership interest were computed by dividing the limited partners share of net income (loss) and distributions by the number of limited partnership interests outstanding at the beginning of the year. The number of limited partnership interests used was 10,507 and 10,514 for the years ended December 31, 2015 and 2014, respectively. |
Note 1 - Organization and Sum18
Note 1 - Organization and Summary of Significant Accounting Policies: Cash and Cash Equivalents (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash on hand and in bank accounts. At certain times, the amount of cash deposited at a bank may exceed the limit on insured deposits. |
Note 1 - Organization and Sum19
Note 1 - Organization and Summary of Significant Accounting Policies: Impairment of Long-lived Assets (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Impairment of Long-lived Assets | Impairment of Long-Lived Assets The Partnership reviews its investments in long-lived assets to determine if there have been any impairments whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. If the sum of the expected future cash flows is less than the carrying amount of the assets, the Partnership recognizes an impairment loss. There were no impairment losses recognized during the years ended December 31, 2015 and 2014. |
Note 1 - Organization and Sum20
Note 1 - Organization and Summary of Significant Accounting Policies: Segment Reporting (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Segment Reporting | Segment Reporting Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 280-10, Segment Reporting, established standards for the way that public business enterprises report information about operating segments in annual financial statements and requires that those enterprises report selected information about operating segments in interim financial reports. ASC Topic 280-10 also established standards for related disclosures about products and services, geographic areas and major customers. As defined in ASC Topic 280-10, the Partnership has only one reportable segment. |
Note 1 - Organization and Sum21
Note 1 - Organization and Summary of Significant Accounting Policies: Fair Value of Financial Instruments (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC Topic 825, Financial Instruments, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate fair value. Fair value is defined as the amount at which the instruments could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The Partnership believes that the carrying amounts of other assets and liabilities reported on the balance sheet at December 31, 2015 that require such disclosure approximated their fair value due to the short-term maturity of these instruments. |
Note 1 - Organization and Sum22
Note 1 - Organization and Summary of Significant Accounting Policies: Variable Interest Entities (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Policies | |
Variable Interest Entities | Variable Interest Entities The Partnership consolidates any variable interest entities in which the Partnership holds a variable interest and is the primary beneficiary. Generally, a variable interest entity, or VIE, is an entity with one or more of the following characteristics: (a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional subordinated financial support; (b) as a group the holders of the equity investment at risk lack (i) the ability to make decisions about an entitys activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests and substantially all of the entitys activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights. The primary beneficiary of a VIE is generally the entity that has (a) the power to direct the activities of the VIE that most significantly impact the VIEs economic performance, and (b) the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. In determining whether it is the primary beneficiary of a VIE, the Partnership considers qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIEs economic performance and which party controls such activities; the amount and characteristics of the Partnerships investment; the obligation or likelihood for the Partnership or other investors to provide financial support; and the similarity with and significance to the business activities of the Partnership and the other investors. Significant judgments related to these determinations include estimates about the current and future fair values and performance of real estate held by these VIEs and general market conditions. At December 31, 2015 and 2014, the Partnership held variable interests in one VIE, for which the Partnership was not the primary beneficiary. The Partnership has concluded, based on its qualitative consideration of the partnership agreement, the partnership structure and the role of the general partner in the Local Limited Partnership, that the general partner of the Local Limited Partnership is the primary beneficiary of the respective Local Limited Partnership. In making this determination, the Partnership considered the following factors: · · · · · · The VIE at December 31, 2015 consists of a Local Limited Partnership that is directly engaged in the ownership and management of one apartment property with a total of 48 units. The Partnership is involved with the VIE as a non-controlling limited partner equity holder. The Partnerships maximum exposure to loss as a result of its involvement with the unconsolidated VIE is limited to the Partnerships recorded investments in and receivables from the VIE, which was zero at both December 31, 2015 and 2014. The Partnership may be subject to additional losses to the extent of any financial support that the Partnership voluntarily provides in the future . |
Note 2 - Investments in and A23
Note 2 - Investments in and Advances To Local Limited Partnerships: Condensed Combined Balance Sheets of the Local Partnerships (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Tables/Schedules | |
Condensed Combined Balance Sheets of the Local Partnerships | Condensed Combined Balance Sheets of the Local Limited Partnership December 31, 2015 2014 (in thousands unaudited) Assets: Land $ 102 $ 102 Buildings and improvements 2,108 2,108 Accumulated depreciation 1,781 (1,755) Other assets 439 394 Total Assets $ 868 $ 849 Liabilities and Partners Deficiency: Liabilities: Mortgage notes payable $ 1,401 $ 1,435 Other liabilities 81 108 Total Liabilities 1,482 1,543 Partners Deficiency (614) (694) Total Liabilities & Partners' Deficiency $ 868 $ 849 |
Note 2 - Investments in and A24
Note 2 - Investments in and Advances To Local Limited Partnerships: Estimated condensed combined statements of operations for Local Partnerships (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Tables/Schedules | |
Estimated condensed combined statements of operations for Local Partnerships | Condensed Combined Results of Operations of the Local Limited Partnership Years Ended December 31, 2015 2014 (in thousands unaudited) Revenues Rental income $ 443 $ 430 Other income 28 14 Total revenues 471 444 Expenses Depreciation and amortization 28 31 Interest 56 57 Operating 303 317 Total expenses 387 405 Income (loss) from continuing operations $ 84 $ 39 |
Note 2 - Investments in and A25
Note 2 - Investments in and Advances To Local Limited Partnerships: Schedule of Real estate, accumulated depreciation and encumbrances of the Local Partnerships (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Tables/Schedules | |
Schedule of Real estate, accumulated depreciation and encumbrances of the Local Partnerships | Description Encumbrances Land Buildings and Related Personal Property Total Accumulated Depreciation Date of Construction Lakeside Apartments $ 1,401 $ 102 $ 2,108 $ 2,210 $ 1,781 10/80-6/81 |
Note 2 - Investments in and A26
Note 2 - Investments in and Advances To Local Limited Partnerships: Schecule of Reconciliation of real estate (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Tables/Schedules | |
Schecule of Reconciliation of real estate | Years Ended December 31, 2015 2014 (in thousands) Balance at beginning of year $ 2,210 $ 2,208 Additions during the year -- 2 Disposal of property -- -- Balance at end of year $ 2,210 $ 2,210 |
Note 2 - Investments in and A27
Note 2 - Investments in and Advances To Local Limited Partnerships: Schedule of Reconciliation of accumulated depreciation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Tables/Schedules | |
Schedule of Reconciliation of accumulated depreciation | Years Ended December 31, 2015 2014 (in thousands) Balance at beginning of year $ 1,755 $ 1,726 Disposal of property -- -- Depreciation expense for the year 26 29 Balance at end of year $ 1,781 $ 1,755 |
Note 4 - Income Taxes_ Reconcil
Note 4 - Income Taxes: Reconciliation between the Partnership's reported net income and the net income (loss) per tax return (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Tables/Schedules | |
Reconciliation between the Partnership's reported net income and the net income (loss) per tax return | Years Ended December 31, 2015 2014 (in thousands) Net income per financial statements $ (90) $ (85) Partnerships share of Local Limited Partnership 87 25 Income per tax return $ (3) $ (60) Income per limited partnership interest $ (.29) $ (5.64) |
Note 4 - Income Taxes_ Reconc29
Note 4 - Income Taxes: Reconciliation between the Partnership's reported amounts and the Federal tax basis of net assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Tables/Schedules | |
Reconciliation between the Partnership's reported amounts and the Federal tax basis of net assets | December 31, 2015 December 31,2014 (in thousands) (in thousands) Net assets as reported $ 594 $ 684 (Deduct) add: Investment in Partnerships (1,542) (1,648) Deferred offering costs 1,443 1,443 Receivable from affiliates 2,094 2,094 Net assets Federal tax basis $ 2,589 $ 2,573 |
Note 1 - Organization and Sum30
Note 1 - Organization and Summary of Significant Accounting Policies: Abandoned Units (Details) - shares | Dec. 31, 2015 | Dec. 31, 2014 |
Details | ||
OutstandingLimitedPartnershipInterests | 10,507 | 10,507 |
Note 1 - Organization and Sum31
Note 1 - Organization and Summary of Significant Accounting Policies: Net Income and Distribution Per Limited Partnership Interest (Details) - shares | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Details | ||
Number of limited partnership interests | 10,507 | 10,514 |
Note 2 - Investments in and A32
Note 2 - Investments in and Advances To Local Limited Partnerships (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Details | ||
Carrying value in investments in Local Limited Partnerships | $ 0 | $ 0 |
Note 2 - Investments in and A33
Note 2 - Investments in and Advances To Local Limited Partnerships: Condensed Combined Balance Sheets of the Local Partnerships (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
SEC Schedule III, Real Estate Accumulated Depreciation | $ (1,781) | $ (1,755) | $ (1,726) |
Unaudited | |||
Land | 102 | 102 | |
Buildings and Improvements, Gross | 2,108 | 2,108 | |
SEC Schedule III, Real Estate Accumulated Depreciation | 1,781 | (1,755) | |
Other Partnership Assets | 439 | 394 | |
Partnership Assets | 868 | 849 | |
Other Notes Payable | 1,401 | 1,435 | |
Other Liabilities | 81 | 108 | |
Partnership Liabilities | 1,482 | 1,543 | |
Partnership Equity (Deficit) | (614) | (694) | |
Partnership Liabilities and Equity (Deficit) | $ 868 | $ 849 |
Note 2 - Investments in and A34
Note 2 - Investments in and Advances To Local Limited Partnerships: Estimated condensed combined statements of operations for Local Partnerships (Details) - Unaudited - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues: | ||
Rental Income, Nonoperating | $ 443 | $ 430 |
Other income | 28 | 14 |
Expenses | ||
Depreciation, Depletion and Amortization, Nonproduction | 28 | 31 |
Interest Expense | 56 | 57 |
Operating Costs and Expenses | 303 | 317 |
Total Expenses | 387 | 405 |
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest | $ 84 | $ 39 |
Note 2 - Investments in and A35
Note 2 - Investments in and Advances To Local Limited Partnerships: Schedule of Real estate, accumulated depreciation and encumbrances of the Local Partnerships (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Real Estate Assets | $ 2,210 | $ 2,210 | $ 2,208 |
SEC Schedule III, Real Estate Accumulated Depreciation | 1,781 | $ 1,755 | $ 1,726 |
Lakeside Apartments | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | 1,401 | ||
Land | 102 | ||
Buildings and Improvements, Gross | 2,108 | ||
Real Estate Assets | 2,210 | ||
SEC Schedule III, Real Estate Accumulated Depreciation | $ 1,781 |
Note 2 - Investments in and A36
Note 2 - Investments in and Advances To Local Limited Partnerships: Schecule of Reconciliation of real estate (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2014USD ($) | |
Details | |
Real Estate Assets | $ 2,208 |
Additions During The Year | 2 |
Real Estate Assets | $ 2,210 |
Note 2 - Investments in and A37
Note 2 - Investments in and Advances To Local Limited Partnerships: Schedule of Reconciliation of accumulated depreciation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Details | ||
SEC Schedule III, Real Estate Accumulated Depreciation, Beginning Balance | $ 1,755 | $ 1,726 |
Depreciation | 26 | 29 |
SEC Schedule III, Real Estate Accumulated Depreciation, Ending Balance | $ 1,781 | $ 1,755 |
Note 4 - Income Taxes_ Reconc38
Note 4 - Income Taxes: Reconciliation between the Partnership's reported net income and the net income (loss) per tax return (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Details | ||
Net income (loss) | $ (90) | $ (85) |
Partnership's Share of Local Partnerships Income | 87 | 25 |
Net income (loss) per tax return | $ (3) | $ (60) |
Net income (loss) per limited partnership interest | $ (0.29) | $ (5.64) |
Note 4 - Income Taxes_ Reconc39
Note 4 - Income Taxes: Reconciliation between the Partnership's reported amounts and the Federal tax basis of net assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Details | ||
Net Assets | $ 594 | $ 684 |
Investment in Partnerships | (1,542) | (1,648) |
Deferred offering costs | 1,443 | 1,443 |
Receivable from affiliates | 2,094 | 2,094 |
Net Assets - Federal Tax Basis | $ 2,589 | $ 2,573 |