SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended June 30, 2000 Commission file number 0-11578 AMERICAN REPUBLIC REALTY FUND I (Exact name of registrant as specified in its charter) WISCONSIN 39-1421936 (State or other jurisdiction of (IRS Employer incorporation or organization Identification Number) 6210 Campbell Road Suite 140 Dallas, Texas 75248 (Address of principal executive offices) Registrant's telephone number, including area code: (972)380-8000. 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: Y No: REGISTRANT IS A LIMITED PARTNERSHIP TABLE OF CONTENTS Item 1. Financial Statements The following Unaudited financial statements are filed herewith: Consolidated Balance Sheet as of June 30, 2000 and December 31, 1999 Page 3 Consolidated Statements of Operations for the Three and Six Months Months Ended June 30, 2000 and 1999 Page 4 Consolidated Statements of Cash Flows for the Three months Ended June 30, 2000 and 1999 Page 5 Item 2. Results of Operations and Management's Discussion and Analysis of Financial Condition Page 6 Liquidity and Capital Resources Page 7 Other Information Page 8 Signatures Page 9 The statements, insofar as they relate to the period subsequent to December 31, 1999, are Unaudited. PART 1. FINANCIAL INFORMATION Item 1. Financial Statements AMERICAN REPUBLIC REALTY FUND I Condensed Consolidated Balance Sheets June 30, December 31, 2000 1999 (Unaudited) ASSETS Real Estate assets, at cost Land $1,822,718 $1,822,718 Buildings $15,656,616 $15,656,616 and improvements 17,479,334 17,479,334 Less: ($10,722,557) ($10,382,557) Accumulated depreciation $6,756,777 $7,096,777 Cash $270,364 $116,649 including cash investments Escrow $427,495 $542,074 deposits Prepaid $49,895 $14,067 Expenses Deferred $160,601 $172,072 Financing Fees Total $7,665,132 $7,941,639 assets LIABILITIES AND STOCK HOLDER'S EQUITY Liabilities Mortgage $10,508,647 $10,572,372 and notes payable Note Payable $0 $165,346 to affiliates Amounts due $0 $4,490 affiliates Real estate $137,496 $0 taxes payable Security $72,000 $68,610 deposits Accounts $157,251 297,610 payable & accrued expenses Total 10,875,394 11,108,428 liabilities Partner's Deficit ($3,210,262) ($3,166,789) Total $7,665,132 $7,941,639 liabilities and partner deficit See notes to Condensed Consolidated Financial Statements AMERICAN REPUBLIC REALTY FUND I Condensed Consolidated Statement of Operations (Unaudited) Three Months Ended Six Months Ended June 30, 1999 June 30, 2000 REVENUES 2000 1999 2000 1999 Rental income 677,399 657,602 1,353,120 $1,321,433 Other property 14,546 13,710 32,167 28,738 Total revenues 691,945 671,312 1,385,287 1,350,171 EXPENSES Salaries & wages 63,764 84,225 130,690 150,502 Maintenance & repairs 57,568 70,921 101,811 167,253 Utilities 28,724 43,265 90,623 86,577 Real estate taxes 68,748 67,500 137,496 135,000 General administrative 33,682 31,121 53,646 59,784 Contract services 26,007 26,981 54,818 55,116 Insurance 11,374 10,209 21,726 20,821 Interest 207,270 209,356 417,248 420,436 Depreciation and 175,736 179,872 351,472 359,743 amortization Property management 34,648 33,514 69,231 67,400 fees (a) Total expenses 707,521 756,964 1,428,761 1,522,632 Net Income ($15,576) ($85,652) (43,474) (172,461) NET INCOME PER UNIT $(1.42) $(7.79) $(3.95) $(15.68) See Notes to Condensed Consolidated Financial Statements AMERICAN REPUBLIC REALTY FUND I Condensed Consolidated Statement of Cash Flows See Notes to Condensed Consolidated Financial Statements Unaudited Three Months Ended June 30, 2000 1999 CASH FLOWS FROM OPERATING ACTIVITY Net income (loss) ($43,474) ($172,461) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 340,000 330,000 Net Effect of changes in operating accounts Escrow deposits 114,579 (10,224) Prepaid expenses (35,828) (28,586) Accrued real estate taxes 137,496 135,000 Security deposits 3,390 7,667 Accounts payable (140,359) (122,865) Other assets 11,471 29,742 Net cash provided by (used for) 387,275 168,273 operating activities CASH FLOWS FROM INVESTING ACTIVITIES Repayment of mortgage notes payable (63,725) (58,915) Repayment of notes payable to (165,346) affiliates Proceeds from amounts due affiliates (4,490) (98,931) Repayment of amounts due affiliates (46,853) Net cash used for investing activities (233,561) (204,699) NET INCREASE (DECREASE) IN CASH 153,714 (36,426) AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS, 116,649 146,358 BEGINNING OF PERIOD CASH AND CASH EQUIVALENTS, END OF PERIOD $270,363 $109,932 Basis of Presentation: Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Partnership believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Partnership's latest annual report on Form 10-K. Item 2. RESULTS OF OPERATIONS AND MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION SECOND QUARTER 2000 COMPARED TO SECOND QUARTER 1999 At June 30, 2000 the Partnership owned two properties with approximately 416,623 net rentable square feet. Both properties are apartment communities. The portfolio had an average occupancy of 94.3% for the first six months of 2000, as compared to 94.2% for the second quarter of 1999. Revenue from property operations increased $20,633, or 3.07%, for the second quarter of 2000, as compared to the 1999 second quarter. The increase in rental income of $19,797 or 3.01% is primarily due to an increase in rental rates. The increase in other income of $836 or 6.10% is primarily due to an increase in Late and other fee collections from the properties. The following table illustrates the components: Increase Percent (Decrease) Change Rental income 19,797 3.01% Other property 836 6.10% Net Increase (Decrease) 20,633 3.07% Property operating expenses decreased $49,443, or 6.53%, for the second quarter of 2000, as compared to the same period in 1999, primarily due to decreases in maintenance and repairs expense. The decrease in maintenance and repairs expense is due to a one time charge in 1999 for resurfacing the parking lots. Salaries and wages decreased $20,461 or 24.29% primarily due to staffing shortages. Utilities decreased $14,541 or 33.61% primarily due to decreased consumption. Insurance increased $2,086 or 11.41% with the annual policy renewal. The following table illustrates the components by category: Increase Percent (Decrease) Change Salaries & wages (20,461) 24.29% Maintenance & repairs (13,353) 18.83% Utilities (14,541) 33.61% Real estate taxes 1,248 1.85% General administrative 2,561 8.23% Contract services (974) 3.61% Insurance 1,165 11.41% Interest (2,086) 1.00% Depreciation and amortization (4,136) 2.30% Property management fees (a) 1,134 3.38% Net Increase (Decrease) (49,443) 6.53% FIRST SIX MONTHS 2000 COMPARED TO FIRST SIX MONTHS 1999 Revenue from property operations increased $35,116, or 2.6%, for the first six months of 2000, as compared to the 1999 first six months . The increase in rental income of $35,116 or 2.6% is primarily due to an increase in rental rates. The increase in other income of $3,429 or 11.93% is primarily due to an increase in Late and other fee collections from the properties. The following table illustrates the components: Increase Percent (Decrease) Change Rental income 31,687 2.40% Other property 3,429 11.93% Net Increase 35,116 2.60% Property operating expenses decreased $93,871, or 6.17%, for the first six months of 2000, as compared to the same period in 1999, primarily due to decreases in maintenance and repairs expense. The decrease in maintenance and repairs expense is due to a one time charge in 1999 for resurfacing the parking lots. Salaries and wages decreased $19,812 or 13.16% primarily due to staffing shortages.. Utilities rose $4,046 or 4.67% primarily due to increases in usage and rates of water and wastewater charges. General and Administrative decreased $6,138 or 10.27% primarily due to professional fees relating to cable wiring of the properties. The following table illustrates the components by category: Increase (Decrease) Salaries & wages (19,812) 13.16% Maintenance & repairs (65,442) 39.13% Utilities 4,046 4.67% Real estate taxes 2,496 1.85% General administrative (6,138) 10.27% Contract services (298) 0.54% Insurance 905 4.35% Interest (3,188) 0.76% Depreciation and amortization (8,271) 2.30% Property management fees (a) 1,831 2.72% Net Increase (Decrease) (93,871) 6.17% LIQUIDITY AND CAPITAL RESOURCES While it is the General Partners primary intention to operate and manage the existing real estate investments, the General Partner also continually evaluates this investment in light of current economic conditions and trends to determine if this asset should be considered for disposal. At this time, there is no plan to dispose of either property. As of June 30, 2000, the Partnership had $270,364 in cash and cash equivalents as compared to $116,649 as of December 31, 1999 . The net increase in cash of $153,715 is principally due to cash flow from operations. During the first quarter of 2000 ending March 31, the partnership paid off the remaining balance owned to the general partner of $165,346. The payment was made with operating cash flow from the partnership. Each asset of the fund refinanced its debt during July 1997. The fund retired debt with a face value of $6,500,000 and replaced with debt of $10,800,000. The new mortgages in the amounts of $4,000,000, $6,800,000 carry interest rates of 7.8% and 7.92% respectively. The notes come due August, 2007. The Partnership's required principal payments due under the stated terms of the Partnership's mortgage notes payable and notes payable to affiliates are $111,063, $120,132 and $129,941, for each of the next three years. Net proceeds from the refinancing were used to reduce the notes payable to affiliates. During July, 1997 payments of $3,500,000 were made to reduce the debt to affiliates. This together with interest on the debt reduced the amounts due affiliates to $300,461 at March 31, 1999. A gain on retirement of debt arose with the note refinancing being triggered by the early retirement of the debt. The recognized gain of $348,836, was the difference between the carrying value of the debt and the funds necessary to retire the debt. Additionally, the general partner has provided funding to the Partnership in the form of notes payable with balances at December 31,1998 totaling $399,392 which accrue interest at rates ranging from prime plus 2%; to 8.25% and are due on June 30, 2001, or upon demand The general partner is not obligated to provide additional funding to the Partnership. For the foreseeable future, the Partnership anticipates that mortgage principal payments (excluding any balloon mortgage payments), improvements and capital expenditures will be funded by net cash from operations. The primary source of capital to fund future Partnership acquisitions and balloon mortgage payments will be proceeds from the sale, financing or refinancing of the Properties. The Partnership's required principal payments due under the stated terms of the Partnership's mortgage notes payable are $102,678, $111,063 and $120,131 for each of the next three years. Other Information Item 1. Legal Proceedings Item 2. Changes in Securities None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information None Item 6. Exhibit and Reports on Form 8-K (A)The following documents are filed herewith or incorporated herein by reference as indicated as Exhibits: Exhibit Designation Document Description 2 Certificate of Limited partnership, as amended, incorporated by reference to Registration Statement No.2-81074 effective May 2, 1983. Limited Partnership Agreement, incorporated by reference to Registration Statement No.2-81074 effective May 2,1983. 11 Not Applicable 15 Not Applicable 18 Not Applicable 19 Not Applicable 20 Not Applicable 23 Not Applicable 24 Not Applicable 25 Power of Attorney, incorporated by reference to Registration Statement No. 2-81074 effective May 2, 1983. 28 None (B) Reports on Form 8-K for the quarter ended June 30, 2000. 1 None SIGNATURES 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. AMERICAN REPUBLIC REALTY FUND I a Wisconsin limited partnership By: /s/ Robert J. Werra Robert J. Werra, General Partner Date: August 1, 2000 [ARTICLE] 5 [LEGEND] THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM BOTH THE June 30, 2000 BALANCE SHEET AND STATEMENT OF INCOME AND EXPENSES AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. [/LEGEND] [CIK] 0000711512 [NAME] AMERICAN REPUBLIC REALTY FUND I [PERIOD-TYPE] 3-MOS [FISCAL-YEAR-END] DEC-31-2000 [PERIOD-END] JUN-30-2000 [CASH] 270,364 [SECURITIES] 0 [RECEIVABLES] 0 [ALLOWANCES] 0 [INVENTORY] 0 [CURRENT-ASSETS] 0 [PP&E] 17,479,334 [DEPRECIATION] 10,722,557 [TOTAL-ASSETS] 7,665,132 [CURRENT-LIABILITIES] 0 [BONDS] 10,508,647 [PREFERRED-MANDATORY] 0 [PREFERRED] 0 [COMMON] 0 [OTHER-SE] (3,210,262) [TOTAL-LIABILITY-AND-EQUITY] 7,665,132 [SALES] 0 [TOTAL-REVENUES] 691,945 [CGS] 0 [TOTAL-COSTS] 0 [OTHER-EXPENSES] 500,251 [LOSS-PROVISION] 0 [INTEREST-EXPENSE] 207,270 [INCOME-PRETAX] 0 [INCOME-TAX] 0 [INCOME-CONTINUING] 0 [DISCONTINUED] 0 [EXTRAORDINARY] 0 [CHANGES] 0 [NET-INCOME] (15,576) [EPS-BASIC] (1.42) [EPS-DILUTED] 0