SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
/_x_/ Quarterly report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934.
For the quarterly period ended September 30, 2001
/___/ Transition report pursuant to Section 13 or 15(d) of the
Securities Act of 1934
for the transition period from ______________ to ________________.
Commission File Number 2-83291
DSI REALTY INCOME FUND VII, A California Limited Partnership
(Exact name of registrant as specified in its charter)
California_______________________________________95-3871044
(State or other jurisdiction of (I.R.S. Employer
incorporation) Identification No.)
6700 E. Pacific Coast Hwy, Long Beach, California 90803
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code-(562)493-8881
_________________________________________________________________
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__.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The information required by Rule 10-01 of Regulation S-X is
included in the Quarterly Report to the Limited Partners of Registrant for
the period ended September 30, 2001 which is attached hereto as Exhibit "20"
and incorporated herein by this reference.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Registrant incorporates by this reference its Quarterly Report to
Limited Partners for the period ended September 30, 2001.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8K.
(a) Attached hereto as Exhibit "20" is Registrant's Quarterly
Report to Limited Partners for the period ended September 30, 2001.
(b) Registrant did not file any reports on Form 8-K for the
period reported upon.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: October 31, 2001 DSI REALTY INCOME FUND VII
A California Limited Partnership
(Registrant)
By____\s\ Robert J. Conway_____
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial Officer
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: October 31, 2001 DSI REALTY INCOME FUND VII
A California Limited Partnership
(Registrant)
By__\s\ Robert J. Conway________
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial Officer
October 31, 2001
QUARTERLY REPORT TO THE LIMITED PARTNERS
OF DSI REALTY INCOME FUND VII
DEAR LIMITED PARTNERS:
We are pleased to enclose the Partnership's unaudited financial statements
for the period ended September 30, 2001. The following is Management's
discussion and analysis of the Partnership's financial condition and
results of its operations.
For the three-month periods ended September 30, 2001 and 2000, total revenues
increased 7.1% from $613,355 to $657,158 and total expenses decreased 35.8%
from $457,784 to $293,879 and other income decreased from $2,198 to $959. As
a result, net income increased 130.9% from $157,769 for the three-month
period ended September 30, 2000, to $364,238 for the same period in 2001.
Rental revenue increased primarily as a result of hiher unit rental rates.
Occupancy levels for the Partnership's six mini-storage facilities averaged
89.6% for the three-month period ended September 30, 2001 and 90.8% for the
same period in 2000. The Partnership is continuing its its marketing efforts
to attract and keep new tenants in its various mini-storage facilities.
Operating expenses decreased approximately $179,800 (42.9%) primarily as a
result of decreases in depreciation, maintenance and repair, salaries and
wages and security alarm service expenses, partially off-set by an increase
in property management fees. Property management fees, which are based on
rental income, increased as a result of the increase in rental revenue. There
was a substantial decrease in depreciation expense, as the Partnership's
properties are fully depreciated. General and administrative expenses in-
creased approximately $15,900 (41.3%) primarily as a result of an increase
in incentive management fees. Incentive management fees, which are based
on cash available for distributions, increased as a result of the increase
in net income.
For the nine-month periods ended September 30, 2001, and 2000, total revenues
increased 10.2% from $1,739,219 to $1,915,834 and total expenses decreased
29.4% from $1,248,259 to $881,345 and other income decreased from $5,971 to
$3,603. As a result, net income increased 108.9% from $496,931 for the nine
months ended September 30, 2000, to $1,038,092 for the same period in 2001.
Rental revenue increased primarily as a result of high unit rental rates.
Operating expenses decreased approximately $380,800 (35.0%) primarily due to
decreases in yellow pages advertising costs, maintenance and repair, office
supplies, workers compensation insurance expenses and depreciation, partially
offset by increases in property management fees, salaries and wages and
security alarm service expenses. The increase in property management fees
and decrease in depreciation was discussed above. General and administrative
expenses increased approximately $13,900 (8.7%) for the reason discussed above.
The General Partners will continue their policy of funding improvements and
maintenance of Partnership properties with cash generated from operations.
The Partnership's financial resources appear to be adequate to meet its needs.
The General Partners anticipate distributions to the Limited Partners
to remain at the current level for the foreseeable future.
We are not enclosing a copy of the Partnership Form 10-Q as filed with the
Securities and Exchange Commission since all the information set forth
therein is contained either in this letter or in the attached financial
statements. However, if you wish to receive a copy of said report, please
send a written request to DSI Realty Income Fund VII, P.O. Box 357,
Long Beach, California 90801.
Very truly yours,
DSI REALTY INCOME FUND VII
By: DSI Properties, Inc., as
General Partner
By /s/ Robert J. Conway
____________________________
ROBERT J. CONWAY, President
DSI REALTY INCOME FUND VII
(A California Real Estate Limited Partnership)
BALANCE SHEETS(UNAUDITED)
SEPTEMBER 30, 2001 AND DECEMBER 31, 2000
September 30, December 31,
2001 2000
ASSETS
CASH AND CASH EQUIVALENTS $ 791,143 $ 468,842
PROPERTY, Net 2,089,800 2,089,800
OTHER ASSETS 52,588 44,588
TOTAL $2,933,531 $2,603,230
LIABILITIES AND PARTNERS' EQUITY(DEFICIT)
LIABILITIES $ 640,869 $ 621,388
PARTNERS' EQUITY (DEFICIT):
General Partners (84,841) (87,950)
Limited Partners 2,377,503 2,069,792
Total partners' equity 2,292,662 1,981,842
TOTAL $2,933,531 $2,603,230
See accompanying notes to financial statements (unaudited).
STATEMENTS OF INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
September 30, September 30,
2001 2000
REVENUES:
Rental $ 657,158 $ 613,355
EXPENSES:
Operating 239,437 419,268
General and administrative 54,442 38,516
Total expenses 293,879 457,784
OPERATING INCOME $ 363,279 $ 155,571
OTHER INCOME
Interest 959 2,198
NET INCOME 364,238 157,769
AGGREGATE NET INCOME ALLOCATED TO:
Limited partners $ 360,596 $ 156,191
General partners 3,642 1,578
TOTAL $ 364,238 $ 157,769
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 15.02 $ 6.51
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 24,000 24,000
See accompanying notes to financial statements (unaudited).
STATEMENTS OF INCOME (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
September 30, September 30,
2001 2000
REVENUES:
Rental $1,915,834 $1,739,219
EXPENSES:
Operating 707,847 1,088,622
General and administrative 173,498 159,637
Total expenses 881,345 1,248,259
OPERATING INCOME $1,034,489 $490,960
OTHER INCOME
Interest 3,603 5,971
NET INCOME 1,038,092 496,931
AGGREGATE NET INCOME ALLOCATED TO:
Limited partners 1,027,711 491,962
General partners 10,381 4,969
TOTAL 1,038,092 496,931
NET INCOME PER LIMITED
PARTNERSHIP UNIT $42.82 $20.50
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 24,000 24,000
See accompanying notes to financial statements (unaudited).
STATEMENTS OF CHANGES IN PARTNERS' EQUITY (DEFICIT)(UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
GENERAL LIMITED
PARTNERS PARTNERS TOTAL
BALANCE AT JANUARY 1, 2000 ($86,270) $2,236,131 $2,149,861
NET INCOME 4,969 491,962 496,931
DISTRIBUTIONS (7,272) (720,000) (727,272)
BALANCE AT SEPTEMBER 30, 2000 ($88,573) $2,008,093 $1,919,520
BALANCE AT JANUARY 1, 2001 ($87,950) $2,069,792 $1,981,842
NET INCOME 10,381 1,027,711 1,038,092
DISTRIBUTIONS (7,272) (720,000) (727,272)
BALANCE AT SEPTEMBER 30, 2001 ($84,841) $2,377,503 $2,292,662
See accompanying notes to financial statements(unaudited).
STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
September 30, September 30,
2001 2000
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $1,038,092 $ 496,931
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 0 381,980
Changes in assets and
liabilities:
Increase in other assets (8,000) 0
Increase in liabilities: 19,481 42,237
Net cash provided by
operating activities 1,049,573 921,148
CASH FLOWS FROM FINANCING ACTIVITIES -
Distributions to partners (727,272) (727,272)
NET INCREASE IN CASH AND
CASH EQUIVALENTS 322,301 193,876
CASH AND CASH EQUIVALENTS:
At beginning of period 468,842 525,003
At end of period $ 791,143 $ 718,879
See accompanying notes to financial statements(unaudited).
DSI REALTY INCOME FUND VII
(A California Real Estate Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. GENERAL
DSI Realty Income Fund VII (the "Partnership"), has two general partners
(DSI Properties, Inc., and Diversified Investors Agency) and limited
partners owning 24,000 limited partnership units. The Partnership was formed
under the California Uniform Limited Partnership Act for the primary purpose
of acquiring and operating real estate.
The accompanying financial information as of September 30, 2001, and for
the periods ended September 30, 2001, and 2000 is unaudited. Such financial
information includes all adjustments which are considered necessary by the
Partnership's management for a fair presentation of the results for the
periods indicated.
2. PROPERTY
Properties owned by the Partnership are all mini-storage facilities.
Depreciation is calculated using the straight line method over the
estimated useful life of 15 years. The total cost of property and
accumulated depreciation at September 30, 2001, is as follows:
Land $ 2,089,800
Buildings and equipment 7,685,522
Equipment 60,760
Total 9,836,082
Less: Accumulated Depreciation ( 7,746,282)
Property - Net $ 2,089,800
3. NET INCOME PER LIMITED PARTNERSHIP UNIT
Net income per limited partnership unit is calculated by dividing the net
income allocated to the limited partners by the number of limited
partnership units outstanding during the period.