UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2005
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from _________to _________
Commission file number 0-11574
SHELTER PROPERTIES V
(Exact name of small business issuer as specified in its charter)
South Carolina 57-0721855
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
55 Beattie Place, PO Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
Issuer's telephone number
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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
SHELTER PROPERTIES V
CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands, except unit data)
March 31, 2005
Assets
Cash and cash equivalents $ 444
Receivables and deposits 402
Restricted escrows 278
Other assets 1,655
Investment properties:
Land $ 4,054
Buildings and related personal property 89,078
93,132
Less accumulated depreciation (60,314) 32,818
$ 35,597
Liabilities and Partners' Deficit
Liabilities
Accounts payable $ 586
Tenant security deposit liabilities 283
Accrued property taxes 271
Other liabilities 661
Due to affiliates (Note C) 3,207
Mortgage notes payable 43,694
Partners' Deficit
General partners $ (383)
Limited partners (52,538 units
issued and outstanding) (12,722) (13,105)
$ 35,597
See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per unit data)
Three Months Ended
March 31,
2005 2004
Revenues:
Rental income $ 3,211 $ 3,059
Other income 368 375
Total revenues 3,579 3,434
Expenses:
Operating 1,651 1,533
General and administrative 105 82
Depreciation 832 853
Interest 904 869
Property taxes 321 260
Total expenses 3,813 3,597
Net loss $ (234) $ (163)
Net loss allocated to general partners (1%) $ (2) $ (2)
Net loss allocated to limited partners (99%) (232) (161)
$ (234) $ (163)
Net loss per limited partnership unit $ (4.42) $ (3.06)
See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' DEFICIT
(Unaudited)
(in thousands, except unit data)
Limited
Partnership General Limited
Units Partners Partners Total
Original capital contributions 52,538 $ 2 $52,538 $52,540
Partners' deficit at
December 31, 2004 52,538 $ (381) $(12,490) $(12,871)
Net loss for the three months
ended March 31, 2005 -- (2) (232) (234)
Partners' deficit at
March 31, 2005 52,538 $ (383) $(12,722) $(13,105)
See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended
March 31,
2005 2004
Cash flows from operating activities:
Net loss $ (234) $ (163)
Adjustments to reconcile net loss
to net cash provided by operating activities:
Depreciation 832 853
Amortization of loan costs 18 19
Casualty loss (16) --
Change in accounts:
Receivables and deposits 66 56
Other assets (177) (319)
Accounts payable (17) 99
Tenant security deposit liabilities 10 (13)
Accrued property taxes 177 23
Due to affiliates (70) --
Other liabilities (39) 47
Net cash provided by operating activities 550 602
Cash flows from investing activities:
Property improvements and replacements (1,167) (193)
Net deposits to restricted escrows (1) --
Net cash used in investing activities (1,168) (193)
Cash flows from financing activities:
Payments on mortgage notes payable (360) (293)
Advances from affiliate 318 150
Payments on advances from affiliate (34) (150)
Net cash used in financing activities (76) (293)
Net (decrease) increase in cash and cash equivalents (694) 116
Cash and cash equivalents at beginning of period 1,138 458
Cash and cash equivalents at end of period $ 444 $ 574
Supplemental disclosure of cash flow information:
Cash paid for interest $ 889 $ 744
Supplemental disclosure of non-cash activity:
Property improvements and replacements in accounts
payable $ 442 $ 40
At December 31, 2004, approximately $726,000 of property improvements and
replacements were included in accounts payable.
See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note A - Basis of Presentation
The accompanying unaudited consolidated financial statements of Shelter
Properties V (the "Partnership" or "Registrant") have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-QSB and Item 310(b) of
Regulation S-B. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. The general partner responsible for management of the
Partnership's business is Shelter Realty V Corporation (the "Corporate General
Partner"). In the opinion of the Corporate General Partner, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three month period
ended March 31, 2005 are not necessarily indicative of the results that may be
expected for the fiscal year ending December 31, 2005. For further information,
refer to the consolidated financial statements and footnotes thereto included in
the Partnership's Annual Report on Form 10-KSB for the fiscal year ended
December 31, 2004. The Corporate General Partner is a subsidiary of Apartment
Investment and Management Company ("AIMCO"), a publicly traded real estate
investment trust. The other general partner of the partnership, AIMCO
Properties, L.P., is also an affiliate of AIMCO.
Note B - Reconciliation of Cash Flows
As required by the Partnership Agreement, the following is a reconciliation of
"Net cash provided by operating activities" in the accompanying consolidated
statements of cash flows to "Net cash from operations", as defined in the
Partnership Agreement. However, "Net cash from operations" should not be
considered an alternative to net loss as an indicator of the Partnership's
operating performance or to cash flows as a measure of liquidity.
Three Months Ended
March 31,
(in thousands)
2005 2004
Net cash provided by operating activities $ 550 $ 602
Payments on mortgage notes payable (360) (293)
Property improvements and replacements (1,167) (193)
Change in restricted escrows, net (1) --
Changes in reserves for net operating
liabilities 50 107
Net cash (used in) from operations $ (928) $ 223
Note C - Transactions with Affiliated Parties
The Partnership has no employees and depends on the Corporate General Partner
and its affiliates for the management and administration of all Partnership
activities. The Partnership Agreement provides for certain payments to
affiliates for services and reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership.
Affiliates of the Corporate General Partner receive 5% of gross receipts from
all of the Partnership's investment properties as compensation for providing
property management services. The Partnership paid to such affiliates
approximately $176,000 and $185,000 for the three months ended March 31, 2005
and 2004, respectively, which are included in operating expenses.
In accordance with the Partnership Agreement, during the fourth quarter of 2004,
the Corporate General Partner advanced approximately $1,949,000 to the
Partnership to fund the redevelopment project at Lake Johnson Mews Apartments
and approximately $954,000 to fund operating expenses and real estate taxes at
four of the Partnership's investment properties. During the three months ended
March 31, 2005, the Corporate General Partner loaned approximately $199,000 to
the Partnership to fund the redevelopment project at Lake Johnson Mews
Apartments and approximately $119,000 to fund real estate taxes and capital
expenditures at Lake Johnson Mews Apartments and Foxfire Apartments. The
Corporate General Partner loaned approximately $150,000 to the Partnership to
fund real estate taxes at Woodland Village Apartments during the three months
ended March 31, 2004. Interest is accrued at 10.0% on the redevelopment advances
and the prime rate plus 2% (7.75% at March 31, 2005) for all other advances.
Interest expense was approximately $65,000 and $1,000 for the three months ended
March 31, 2005 and 2004, respectively. During the three months ended March 31,
2005 and 2004, the Partnership made payments on advances of approximately
$34,000 and $150,000, respectively, and related interest of $66,000 and $1,000,
respectively, with cash from operations. At March 31, 2005, the total
outstanding advances and accrued interest due to an affiliate of the Corporate
General Partner is approximately $3,207,000 and is included in due to
affiliates. An affiliate of the Corporate General Partner has committed to fund
additional redevelopment costs for the redevelopment project at Lake Johnson
Mews Apartments of approximately $1,911,000 (see Item 2. Management's Discussion
and Analysis or Plan of Operation).
Affiliates of the Corporate General Partner charged the Partnership for
reimbursement of accountable administrative expenses amounting to approximately
$111,000 and $70,000 for the three months ended March 31, 2005 and 2004,
respectively, which are included in general and administrative expenses and
investment properties. The portion of these reimbursements included in
investment properties for the three months ended March 31, 2005 and 2004 are
fees related to construction management services provided by an affiliate of the
Corporate General Partner of approximately $31,000 and $14,000, respectively.
The construction management service fees are calculated based on a percentage of
current additions to investment properties.
The Partnership insures its properties up to certain limits through coverage
provided by AIMCO which is generally self-insured for a portion of losses and
liabilities related to workers' compensation, property casualty and vehicle
liability. The Partnership insures its properties above the AIMCO limits through
insurance policies obtained by AIMCO from insurers unaffiliated with the
Corporate General Partner. During the three months ended March 31, 2005, the
Partnership was charged by AIMCO and its affiliates approximately $126,000 for
hazard insurance coverage and fees associated with policy claims administration.
Additional charges will be incurred by the Partnership during 2005 as other
insurance policies renew later in the year. The Partnership was charged by AIMCO
and its affiliates approximately $193,000 for insurance coverage and fees
associated with policy claims administration during the year ended December 31,
2004.
Note D - Casualty Events
In September 2004, Millhopper Apartments experienced damage from Hurricane
Frances. At March 31, 2005, the Partnership estimates damage costs of this
casualty will be approximately $78,000. The Corporate General Partner
anticipates that insurance proceeds to be received will be sufficient to cover
estimated repairs and no casualty loss will result from this event. In addition,
the Partnership incurred clean up costs of approximately $60,000, which were not
covered by insurance, for the year ended December 31, 2004. The Partnership
incurred additional clean up costs of approximately $9,000 which were not
covered by insurance, for the three months ended March 31, 2005, which are
reflected in operating expenses.
The Partnership incurred clean up costs of approximately $9,000 at The Lexington
Green Apartments for Hurricanes Frances and Jeanne which were not covered by
insurance for the year ended December 31, 2004. The Partnership incurred
additional clean up costs of approximately $11,000, which were not covered by
insurance, for the three months ended March 31, 2005, which are reflected in
operating expenses. The Partnership also recognized a casualty gain of
approximately $16,000 due to a change in the estimated building damages at The
Lexington Green Apartments, which is reflected in operating expenses.
Note E - Property Taxes
During the three months ended March 31, 2005, the Partnership received
notification that its appeal of the 2004 assessed value of The Lexington Green
Apartments was denied. The Partnership recorded property tax expense for 2004
based upon its best estimate of the property tax as provided by a third party
property tax specialist. The Partnership paid the billed property tax amount and
at December 31, 2004 established a receivable in the amount of approximately
$50,000. This receivable was reversed during the three months ended March 31,
2005, with a resulting increase to property tax expense.
Note F - Contingencies
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia
Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the
State of California for the County of San Mateo. The plaintiffs named as
defendants, among others, the Partnership, its Corporate General Partner and
several of their affiliated partnerships and corporate entities. The action
purported to assert claims on behalf of a class of limited partners and
derivatively on behalf of a number of limited partnerships (including the
Partnership) that are named as nominal defendants, challenging, among other
things, the acquisition of interests in certain Corporate General Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities that were,
at one time, affiliates of Insignia; past tender offers by the Insignia
affiliates to acquire limited partnership units; management of the partnerships
by the Insignia affiliates; and the series of transactions which closed on
October 1, 1998 and February 26, 1999 whereby Insignia and Insignia Properties
Trust, respectively, were merged into AIMCO. The plaintiffs sought monetary
damages and equitable relief, including judicial dissolution of the Partnership.
In addition, during the third quarter of 2001, a complaint captioned Heller v.
Insignia Financial Group (the "Heller action") was filed against the same
defendants that are named in the Nuanes action. On or about August 6, 2001,
plaintiffs filed a first amended complaint. The Heller action was brought as a
purported derivative action, and asserted claims for, among other things, breach
of fiduciary duty, unfair competition, conversion, unjust enrichment, and
judicial dissolution. On January 28, 2002, the trial court granted defendants
motion to strike the complaint.
On January 8, 2003, the parties filed a Stipulation of Settlement in proposed
settlement of the Nuanes action and the Heller action.
On June 13, 2003, the court granted final approval of the settlement and entered
judgment in both the Nuanes and Heller actions. On August 12, 2003, an objector
("Objector") filed an appeal (the "Appeal") seeking to vacate and/or reverse the
order approving the settlement and entering judgment thereto. On May 4, 2004 the
Objector filed a second appeal challenging the court's use of a referee and its
order requiring Objector to pay those fees.
On March 21, 2005, the Court of Appeals issued opinions in both pending appeals.
With regard to the settlement and judgment entered thereto, the Court of Appeals
vacated the trial court's order and remanded to the trial court for further
findings on the basis that the "state of the record is insufficient to permit
meaningful appellate review". With regard to the second appeal, the Court of
Appeals reversed the order requiring the Objector to pay referee fees. On April
26, 2005, the Court of Appeals lifted the stay of a pending appeal related to
the Heller action and the trial court's order striking the complaint. On April
28, 2005, the Objector filed a Petition for Review with the California Supreme
Court in connection with the opinion vacating the order approving settlement and
remanding for further findings. The Corporate General Partner and its affiliates
are currently scheduled to file an answer to Objector's petition on May 18,
2005.
The Corporate General Partner does not anticipate that any costs to the
Partnership, whether legal or settlement costs, associated with these cases will
be material to the Partnership's overall operations.
AIMCO Properties L.P. and NHP Management Company, both affiliates of the
Corporate General Partner, are defendants in a lawsuit alleging that they
willfully violated the Fair Labor Standards Act ("FLSA") by failing to pay
maintenance workers overtime for all hours worked in excess of forty per week.
The complaint attempts to bring a collective action under the FLSA and seeks to
certify state subclasses in California, Maryland, and the District of Columbia.
Specifically, the plaintiffs contend that AIMCO Properties L.P. and NHP
Management Company failed to compensate maintenance workers for time that they
were required to be "on-call." Additionally, the complaint alleges AIMCO
Properties L.P. and NHP Management Company failed to comply with the FLSA in
compensating maintenance workers for time that they worked in responding to a
call while "on-call." The defendants have filed an answer to the amended
complaint denying the substantive allegations. Oral argument relating to the
certification of the collective action took place on May 12, 2005 and the
parties await a ruling from the Court. Although the outcome of any litigation is
uncertain, AIMCO Properties, L.P. does not believe that the ultimate outcome
will have a material adverse effect on its financial condition or results of
operations. Similarly, the Corporate General Partner does not believe that the
ultimate outcome will have a material adverse effect on the Partnership's
consolidated financial condition or results of operations.
The Partnership is unaware of any other pending or outstanding litigation
matters involving it or its investment properties that are not of a routine
nature arising in the ordinary course of business.
Environmental
Various Federal, state and local laws subject property owners or operators to
liability for management, and the costs of removal or remediation, of certain
hazardous substances present on a property. Such laws often impose liability
without regard to whether the owner or operator knew of, or was responsible for,
the release or presence of the hazardous substances. The presence of, or the
failure to manage or remedy properly, hazardous substances may adversely affect
occupancy at affected apartment communities and the ability to sell or finance
affected properties. In addition to the costs associated with investigation and
remediation actions brought by government agencies, the presence of hazardous
substances on a property could result in claims by private plaintiffs for
personal injury, disease, disability or other infirmities. Various laws also
impose liability for the cost of removal, remediation or disposal of hazardous
substances through a licensed disposal or treatment facility. Anyone who
arranges for the disposal or treatment of hazardous substances is potentially
liable under such laws. These laws often impose liability whether or not the
person arranging for the disposal ever owned or operated the disposal facility.
In connection with the ownership and operation of its properties, the
Partnership could potentially be liable for environmental liabilities or costs
associated with its properties.
Mold
The Partnership is aware of lawsuits against owners and managers of multifamily
properties asserting claims of personal injury and property damage caused by the
presence of mold, some of which have resulted in substantial monetary judgments
or settlements. The Partnership has only limited insurance coverage for property
damage loss claims arising from the presence of mold and for personal injury
claims related to mold exposure. Affiliates of the Corporate General Partner
have implemented a national policy and procedures to prevent or eliminate mold
from its properties and the Corporate General Partner believes that these
measures will eliminate, or at least minimize, the effects that mold could have
on residents. To date, the Partnership has not incurred any material costs or
liabilities relating to claims of mold exposure or to abate mold conditions.
Because the law regarding mold is unsettled and subject to change the Corporate
General Partner can make no assurance that liabilities resulting from the
presence of or exposure to mold will not have a material adverse effect on the
Partnership's consolidated financial condition or results of operations.
SEC Investigation
The Central Regional Office of the United States Securities and Exchange
Commission (the "SEC") is conducting a formal investigation relating to certain
matters. Although the staff of the SEC is not limited in the areas that it may
investigate, AIMCO believes the areas of investigation include AIMCO's
miscalculated monthly net rental income figures in third quarter 2003,
forecasted guidance, accounts payable, rent concessions, vendor rebates,
capitalization of payroll and certain other costs, and tax credit transactions.
At the end of the first quarter of 2005, the SEC added certain tender offers for
limited partnership interests as an area of investigation. AIMCO is cooperating
fully. AIMCO is not able to predict when the investigation will be resolved.
AIMCO does not believe that the ultimate outcome will have a material adverse
effect on its consolidated financial condition or results of operations.
Similarly, the Corporate General Partner does not believe that the ultimate
outcome will have a material adverse effect on the Partnership's consolidated
financial condition or results of operations.
Note G - Subsequent Event
Subsequent to March 31, 2005, the Partnership entered into a Purchase and Sale
Contract to sell The Lexington Green Apartments to a third party for a purchase
price of approximately $19,200,000. The anticipated closing date for the
transaction is June 13, 2005. At March 31, 2005, the carrying amounts of the
mortgage note payable and investment property for The Lexington Green Apartments
are approximately $6,257,000 and $4,675,000, respectively. The operating results
of The Lexington Green Apartments for the three months ended March 31, 2005 and
2004 were income of approximately $17,000 and $13,000, respectively, which
included revenues of approximately $667,000 and $567,000, respectively.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The matters discussed in this report contain certain forward-looking statements,
including, without limitation, statements regarding future financial performance
and the effect of government regulations. Actual results may differ materially
from those described in the forward-looking statements and will be affected by a
variety of risks and factors including, without limitation: national and local
economic conditions; the terms of governmental regulations that affect the
Registrant and interpretations of those regulations; the competitive environment
in which the Registrant operates; financing risks, including the risk that cash
flows from operations may be insufficient to meet required payments of principal
and interest; real estate risks, including variations of real estate values and
the general economic climate in local markets and competition for tenants in
such markets; litigation, including costs associated with prosecuting and
defending claims and any adverse outcomes, and possible environmental
liabilities. Readers should carefully review the Registrant's financial
statements and the notes thereto, as well as the risk factors described in the
documents the Registrant files from time to time with the Securities and
Exchange Commission.
The Partnership's investment properties consist of seven apartment complexes.
The following table sets forth the average occupancy of the properties for the
three months ended March 31, 2005 and 2004:
March 31,
Property 2005 2004
Foxfire Apartments
Atlanta, Georgia 90% 90%
Old Salem Apartments
Charlottesville, Virginia 89% 91%
Woodland Village Apartments
Columbia, South Carolina (1) 94% 88%
Lake Johnson Mews Apartments
Raleigh, North Carolina 87% 89%
The Lexington Green Apartments
Sarasota, Florida (2) 98% 94%
Millhopper Village Apartments
Gainesville, Florida (3) 97% 89%
Tar River Estates Apartments
Greenville, North Carolina (4) 98% 88%
(1) The Corporate General Partner attributes the increase in occupancy at
Woodland Village Apartments to increased marketing and resident retention
efforts.
(2) The Corporate General Partner attributes the increase in occupancy at The
Lexington Green Apartments to improved economic conditions in the Sarasota
area and increased resident retention efforts.
(3) The Corporate General Partner attributes the increase in occupancy at
Millhopper Village Apartments to improved economic conditions in the
Gainesville area.
(4) The Corporate General Partner attributes the increase in occupancy at Tar
River Estates Apartments to increased resident retention efforts.
The Partnership's financial results depend upon a number of factors including
the ability to attract and maintain tenants at the investment properties,
interest rates on mortgage loans, costs incurred to operate the investment
properties, general economic conditions and weather. As part of the ongoing
business plan of the Partnership, the Corporate General Partner monitors the
rental market environment of its investment properties to assess the feasibility
of increasing rents, maintaining or increasing occupancy levels and protecting
the Partnership from increases in expenses. As part of this plan, the Corporate
General Partner attempts to protect the Partnership from the burden of
inflation-related increases in expenses by increasing rents and maintaining a
high overall occupancy level. However, the Corporate General Partner may use
rental concessions and rental rate reductions to offset softening market
conditions; accordingly, there is no guarantee that the Corporate General
Partner will be able to sustain such a plan. Further, a number of factors that
are outside the control of the Partnership, such as the local economic climate
and weather can adversely or positively affect the Partnership's financial
results.
Results of Operations
The Partnership's net loss for the three months ended March 31, 2005 was
approximately $234,000 as compared to a net loss of approximately $163,000 for
the three months ended March 31, 2004. The increase in net loss is due to an
increase in total expenses, partially offset by an increase in total revenues.
The increase in total expenses is due to increases in operating, interest,
property tax, and general and administrative expenses, partially offset by a
decrease in depreciation expense. The increase in operating expenses is
primarily due to increases in payroll related expenses at Foxfire Apartments and
Tar River Estates Apartments and utility expenses at four of the Partnership's
investment properties. Interest expense increased primarily due to an increase
in interest expense on advances from an affiliate of the Corporate General
Partner, partially offset by scheduled principal payments made on the mortgages
encumbering the Partnership's investment properties, which reduced the carrying
balances of the loans. The increase in property tax expense is primarily due to
an increase in the assessed value of Tar River Estates Apartments and the
unsuccessful appeal of the assessed value of Lexington Green Apartments that
resulted in approximately $50,000 of additional property tax expense related to
2004 being recognized during the three months ended March 31, 2005. The decrease
in depreciation expense is primarily due to property improvements and
replacements placed into service in prior years becoming fully depreciated
during the past twelve months.
The increase in general and administrative expenses is primarily due to an
increase in the management reimbursements to the Corporate General Partner as
allowed under the Partnership Agreement. Costs associated with the quarterly and
annual communications with investors and regulatory agencies and the annual
audit required by the Partnership Agreement are also included in general and
administrative expenses for the three months ended March 31, 2005 and 2004.
The increase in total revenues is primarily due to an increase in rental income,
partially offset by a decrease in other income. Rental income increased
primarily due to increases in occupancy at four of the Partnership's investment
properties and average rental rates at five properties, partially offset by
decreases in occupancy at Old Salem Apartments and Lake Johnson Mews and average
rental rates at Woodland Village Apartments and Old Salem Apartments. The
decrease in other income is primarily due to a decrease in lease cancellation
fees at most of the Partnership's investment properties.
In September 2004, Millhopper Apartments experienced damage from Hurricane
Frances. At March 31, 2005, the Partnership estimates damage costs of
approximately $78,000. The Corporate General Partner anticipates that insurance
proceeds to be received will be sufficient to cover estimated repairs and no
casualty loss will result from this event. In addition, the Partnership incurred
clean up costs of approximately $60,000, which were not covered by insurance,
for the year ended December 31, 2004. The Partnership incurred additional clean
up costs of approximately $9,000 which were not covered by insurance, for the
three months ended March 31, 2005, which are reflected in operating expenses.
The Partnership incurred clean up costs of approximately $9,000 at The Lexington
Green Apartments for Hurricanes Frances and Jeanne which were not covered by
insurance for the year ended December 31, 2004. The Partnership incurred
additional clean up costs of approximately $11,000, which were not covered by
insurance, for the three months ended March 31, 2005, which are reflected in
operating expenses.
During the year ended December 31, 2004, the Corporate General Partner began a
major redevelopment project at Lake Johnson Mews Apartments. The property has
had difficulty staying competitive and needs to be updated. Therefore, in an
effort to increase occupancy and remain competitive in the local market, a
significant redevelopment project has been started and is expected to be
completed in January 2006 at a total cost of approximately $4,059,000. The
project is being funded from advances from an affiliate of the Corporate General
Partner. The Corporate General Partner anticipates that all units will remain
available to lease during the redevelopment period.
Liquidity and Capital Resources
At March 31, 2005, the Partnership had cash and cash equivalents of
approximately $444,000, compared to approximately $574,000 at March 31, 2004.
The decrease in cash and cash equivalents of approximately $694,000, from the
Partnership's year ended December 31, 2004, is due to approximately $1,168,000
of cash used in investing activities and approximately $76,000 of cash used in
financing activities, partially offset by approximately $550,000 of cash
provided by operating activities. Cash used in investing activities consisted of
property improvements and replacements and net deposits to escrow accounts
maintained by the mortgage lenders. Cash used in financing activities consisted
of payments of principal on the mortgages encumbering the Partnership's
investment properties and payment on advances from an affiliate of the Corporate
General Partner, partially offset by the receipt of advances from an affiliate
of the Corporate General Partner. The Partnership invests its working capital
reserves in interest bearing accounts.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the investment properties to adequately maintain the
physical assets and other operating needs of the Partnership and to comply with
Federal, state, and local legal and regulatory requirements. The Corporate
General Partner monitors developments in the area of legal and regulatory
compliance. For example, the Sarbanes-Oxley Act of 2002 mandates or suggests
additional compliance measures with regard to governance, disclosure, audit and
other areas. In light of these changes, the Partnership expects that it will
incur higher expenses related to compliance. Capital improvements planned for
each of the Partnership's properties are detailed below.
Millhopper Village Apartments: During the three months ended March 31, 2005, the
Partnership completed approximately $219,000 of capital improvements at
Millhopper Village Apartments, consisting primarily of roof replacement, siding,
exterior painting, parking area improvements, gutter replacement and
construction resulting from the casualty as discussed in "Results of
Operations". These improvements were funded from operations. The Partnership
regularly evaluates the capital improvement needs of the property. While the
Partnership has no other material commitments for property improvements and
replacements, certain routine capital expenditures are anticipated during 2005.
Such capital expenditures will depend on the physical condition of the property
as well as anticipated cash flow generated by the property.
Foxfire Apartments: During the three months ended March 31, 2005, the
Partnership completed approximately $40,000 of capital improvements at Foxfire
Apartments, consisting primarily of recreational facility upgrades and floor
covering replacement. These improvements were funded from operations and an
advance from an affiliate of the Corporate General Partner. The Partnership
regularly evaluates the capital improvement needs of the property. While the
Partnership has no material commitments for property improvements and
replacements, certain routine capital expenditures are anticipated during 2005.
Such capital expenditures will depend on the physical condition of the property
as well as anticipated cash flow generated by the property.
Lake Johnson Mews Apartments: During the three months ended March 31, 2005, the
Partnership completed approximately $263,000 of capital improvements at Lake
Johnson Mews Apartments arising from the redevelopment of the property.
Additional capital improvements of approximately $41,000 consisted primarily of
floor covering replacement. These improvements were funded from operations and
an advance from an affiliate of the Corporate General Partner. The property is
currently undergoing a redevelopment project in order to remain competitive with
other properties in the area in the effort to increase occupancy at the
property. Based on current redevelopment plans, the Corporate General Partner
anticipates the redevelopment to be complete in January 2006 at a total cost of
approximately $4,059,000. The project is being funded from advances from an
affiliate of the Corporate General Partner and cash from operations. The
Partnership regularly evaluates the capital improvement needs of the property.
The Partnership currently expects to budget approximately $1,328,000 for
property redevelopment during 2005. While the Partnership has no other material
commitments for property improvements and replacements, certain routine capital
expenditures are anticipated during 2005. Such capital expenditures will depend
on the physical condition of the property as well as anticipated cash flow
generated by the property.
Woodland Village Apartments: During the three months ended March 31, 2005, the
Partnership completed approximately $60,000 of capital improvements at Woodland
Village Apartments, consisting primarily of swimming pool upgrades and floor
covering replacement. These improvements were funded from operations. The
Partnership regularly evaluates the capital improvement needs of the property.
While the Partnership has no material commitments for property improvements and
replacements, certain routine capital expenditures are anticipated during 2005.
Such capital expenditures will depend on the physical condition of the property
as well as anticipated cash flow generated by the property.
The Lexington Green Apartments: During the three months ended March 31, 2005,
the Partnership completed approximately $118,000 of capital improvements at The
Lexington Green Apartments, consisting primarily of balcony upgrades and floor
covering replacement. These improvements were funded from operations. The
Partnership regularly evaluates the capital improvement needs of the property.
While the Partnership has no material commitments for property improvements and
replacements, certain routine capital expenditures are anticipated during 2005.
Such capital expenditures will depend on the physical condition of the property
as well as replacement reserves and anticipated cash flow generated by the
property.
Tar River Estates Apartments: During the three months ended March 31, 2005, the
Partnership completed approximately $24,000 of capital improvements at Tar River
Estates Apartments, consisting primarily of floor covering replacement. These
improvements were funded from operations. The Partnership regularly evaluates
the capital improvement needs of the property. While the Partnership has no
material commitments for property improvements and replacements, certain routine
capital expenditures are anticipated during 2005. Such capital expenditures will
depend on the physical condition of the property as well as anticipated cash
flow generated by the property.
Old Salem Apartments: During the three months ended March 31, 2005, the
Partnership completed approximately $118,000 of capital improvements at Old
Salem Apartments, consisting primarily of furniture and fixtures, structural
improvements, plumbing upgrades, heating upgrades, floor covering replacement,
and construction related to the May 2004 fire, as discussed in the Partnership's
10-KSB for the year ended December 31, 2004. These improvements were funded from
operations. The Partnership regularly evaluates the capital improvement needs of
the property. While the Partnership has no material commitments for property
improvements and replacements, certain routine capital expenditures are
anticipated during 2005. Such capital expenditures will depend on the physical
condition of the property as well as anticipated cash flow generated by the
property.
The capital expenditures will be incurred only if cash is available from
operations and from Partnership reserves. To the extent that capital
improvements are completed, the Partnership's distributable cash flow, if any,
may be adversely affected at least in the short term.
The Partnership's assets are thought to be sufficient for any near-term needs
(exclusive of capital improvements) of the Partnership. The mortgage
indebtedness encumbering all of the Partnership's investment properties of
approximately $43,694,000 is amortized over varying periods with maturity dates
ranging from November 1, 2019 to January 1, 2022, at which time the loans are
scheduled to be fully amortized.
Subsequent to March 31, 2005, the Partnership entered into a Purchase and Sale
Contract to sell The Lexington Green Apartments to a third party for a purchase
price of approximately $19,200,000. The anticipated closing date for the
transaction is June 13, 2005. At March 31, 2005, the carrying amounts of the
mortgage note payable and investment property for The Lexington Green Apartments
are approximately $6,257,000 and $4,675,000, respectively. The operating results
of The Lexington Green Apartments for the three months ended March 31, 2005 and
2004 were income of approximately $17,000 and $13,000, respectively, which
included revenues of approximately $667,000 and $567,000, respectively.
There were no distributions made to the partners during the three months ended
March 31, 2005 and 2004. Future cash distributions will depend on the levels of
net cash generated from operations and the timing of property refinancings
and/or property sales. The Partnership's cash available for distribution is
reviewed on a monthly basis. In light of the amounts accrued and payable to
affiliates of the Corporate General Partner at March 31, 2005, there can be no
assurance that the Partnership will generate sufficient funds from operations,
after required capital improvement expenditures, to permit any distributions to
its partners in 2005 or subsequent periods.
Other
In addition to its indirect ownership of the general partner interests in the
Partnership, AIMCO and its affiliates owned 39,234 limited partnership units
(the "Units") in the Partnership representing 74.68% of the outstanding Units at
March 31, 2005. A number of these Units were acquired pursuant to tender offers
made by AIMCO or its affiliates. It is possible that AIMCO or its affiliates
will acquire additional Units in exchange for cash or a combination of cash and
units in AIMCO Properties, L.P., the operating partnership of AIMCO, either
through private purchases or tender offers. Pursuant to the Partnership
Agreement, unitholders holding a majority of the Units 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 Corporate General Partner. As a result of its ownership of 74.68% of
the outstanding Units, AIMCO and its affiliates are in a position to control all
voting decisions with respect to the Partnership. Although the Corporate General
Partner owes fiduciary duties to the limited partners of the Partnership, the
Corporate General Partner also owes fiduciary duties to AIMCO as its sole
stockholder. As a result, the duties of the Corporate General Partner, as
corporate general partner, to the Partnership and its limited partners may come
into conflict with the duties of the Corporate General Partner to AIMCO as its
sole stockholder.
Critical Accounting Policies and Estimates
The consolidated financial statements are prepared in accordance with accounting
principles generally accepted in the United States, which require the
Partnership to make estimates and assumptions. The Partnership believes that of
its significant accounting policies, the following may involve a higher degree
of judgment and complexity.
Impairment of Long-Lived Assets
The Partnership's investment properties are recorded at cost, less accumulated
depreciation, unless considered impaired. If events or circumstances indicate
that the carrying amount of a property may be impaired, the Partnership will
make an assessment of its recoverability by estimating the undiscounted future
cash flows, excluding interest charges, of the property. If the carrying amount
exceeds the aggregate future cash flows, the Partnership would recognize an
impairment loss to the extent the carrying amount exceeds the fair value of the
property.
Real property investments are subject to varying degrees of risk. Several
factors may adversely affect the economic performance and value of the
Partnership's investment properties. These factors include, but are not limited
to, changes in the national, regional and local economic climate; local
conditions, such as an oversupply of multifamily properties; competition from
other available multifamily property owners and changes in market rental rates.
Any adverse changes in these factors could cause impairment of the Partnership's
assets.
Revenue Recognition
The Partnership generally leases apartment units for twelve-month terms or less.
The Partnership will offer rental concessions during particularly slow months or
in response to heavy competition from other similar complexes in the area.
Rental income attributable to leases, net of any concessions, is recognized on a
straight-line basis over the term of the lease. The Partnership evaluates all
accounts receivable from residents and establishes an allowance, after the
application of security deposits, for accounts greater than 30 days past due on
current tenants and all receivables due from former tenants.
ITEM 3. CONTROLS AND PROCEDURES
(a) Disclosure Controls and Procedures. The Partnership's management, with the
participation of the principal executive officer and principal financial officer
of the Corporate General Partner, who are the equivalent of the Partnership's
principal executive officer and principal financial officer, respectively, has
evaluated the effectiveness of the Partnership's disclosure controls and
procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end
of the period covered by this report. Based on such evaluation, the principal
executive officer and principal financial officer of the Corporate General
Partner, who are the equivalent of the Partnership's principal executive officer
and principal financial officer, respectively, have concluded that, as of the
end of such period, the Partnership's disclosure controls and procedures are
effective.
(b) Internal Control Over Financial Reporting. There have not been any changes
in the Partnership's internal control over financial reporting (as such term is
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the
fiscal quarter to which this report relates that have materially affected, or
are reasonably likely to materially affect, the Partnership's internal control
over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia
Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the
State of California for the County of San Mateo. The plaintiffs named as
defendants, among others, the Partnership, its Corporate General Partner and
several of their affiliated partnerships and corporate entities. The action
purported to assert claims on behalf of a class of limited partners and
derivatively on behalf of a number of limited partnerships (including the
Partnership) that are named as nominal defendants, challenging, among other
things, the acquisition of interests in certain Corporate General Partner
entities by Insignia Financial Group, Inc. ("Insignia") and entities that were,
at one time, affiliates of Insignia; past tender offers by the Insignia
affiliates to acquire limited partnership units; management of the partnerships
by the Insignia affiliates; and the series of transactions which closed on
October 1, 1998 and February 26, 1999 whereby Insignia and Insignia Properties
Trust, respectively, were merged into AIMCO. The plaintiffs sought monetary
damages and equitable relief, including judicial dissolution of the Partnership.
In addition, during the third quarter of 2001, a complaint captioned Heller v.
Insignia Financial Group (the "Heller action") was filed against the same
defendants that are named in the Nuanes action. On or about August 6, 2001,
plaintiffs filed a first amended complaint. The Heller action was brought as a
purported derivative action, and asserted claims for, among other things, breach
of fiduciary duty, unfair competition, conversion, unjust enrichment, and
judicial dissolution. On January 28, 2002, the trial court granted defendants
motion to strike the complaint.
On January 8, 2003, the parties filed a Stipulation of Settlement in proposed
settlement of the Nuanes action and the Heller action.
On June 13, 2003, the court granted final approval of the settlement and entered
judgment in both the Nuanes and Heller actions. On August 12, 2003, an objector
("Objector") filed an appeal (the "Appeal") seeking to vacate and/or reverse the
order approving the settlement and entering judgment thereto. On May 4, 2004 the
Objector filed a second appeal challenging the court's use of a referee and its
order requiring Objector to pay those fees.
On March 21, 2005, the Court of Appeals issued opinions in both pending appeals.
With regard to the settlement and judgment entered thereto, the Court of Appeals
vacated the trial court's order and remanded to the trial court for further
findings on the basis that the "state of the record is insufficient to permit
meaningful appellate review". With regard to the second appeal, the Court of
Appeals reversed the order requiring the Objector to pay referee fees. On April
26, 2005, the Court of Appeals lifted the stay of a pending appeal related to
the Heller action and the trial court's order striking the complaint. On April
28, 2005, the Objector filed a Petition for Review with the California Supreme
Court in connection with the opinion vacating the order approving settlement and
remanding for further findings. The Corporate General Partner and its affiliates
are currently scheduled to file an answer to Objector's petition on May 18,
2005.
The Corporate General Partner does not anticipate that any costs to the
Partnership, whether legal or settlement costs, associated with these cases will
be material to the Partnership's overall operations.
AIMCO Properties L.P. and NHP Management Company, both affiliates of the
Corporate General Partner, are defendants in a lawsuit alleging that they
willfully violated the Fair Labor Standards Act ("FLSA") by failing to pay
maintenance workers overtime for all hours worked in excess of forty per week.
The complaint attempts to bring a collective action under the FLSA and seeks to
certify state subclasses in California, Maryland, and the District of Columbia.
Specifically, the plaintiffs contend that AIMCO Properties L.P. and NHP
Management Company failed to compensate maintenance workers for time that they
were required to be "on-call." Additionally, the complaint alleges AIMCO
Properties L.P. and NHP Management Company failed to comply with the FLSA in
compensating maintenance workers for time that they worked in responding to a
call while "on-call." The defendants have filed an answer to the amended
complaint denying the substantive allegations. Oral argument relating to the
certification of the collective action took place on May 12, 2005 and the
parties await a ruling from the Court. Although the outcome of any litigation is
uncertain, AIMCO Properties, L.P. does not believe that the ultimate outcome
will have a material adverse effect on its financial condition or results of
operations. Similarly, the Corporate General Partner does not believe that the
ultimate outcome will have a material adverse effect on the Partnership's
consolidated financial condition or results of operations.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
See Exhibit Index.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
SHELTER PROPERTIES V
By: Shelter Realty V Corporation
Corporate General Partner
By: /s/Martha L. Long
Martha L. Long
Senior Vice President
By: /s/Stephen B. Waters
Stephen B. Waters
Vice President
Date: May 13, 2005
SHELTER PROPERTIES V
EXHIBIT INDEX
Exhibit
3 See Exhibit 4(a)
3.1 Second Amended and Restated Bylaws of IPT, dated October 2,
1998 (incorporated by reference to Current Report on Form 8-K,
dated October 1, 1998).
4 (a) Amended and Restated Certificate and Agreement of Limited
Partnership (included as Exhibit A to the Prospectus of
Registrant dated May 27, 1983 contained in Amendment No. 1
to Registration Statement No. 2-81308, of Registrant filed
June 8, 1982 (the "Prospectus") and incorporated herein by
reference.)
(b) Subscription Agreement and Signature Page (included as
Exhibits 4(A) and 4 (B) to the Registration Statement,
incorporated herein by reference).
10(i) Contracts related to acquisition of properties.
(a) Purchase Agreement dated May 23, 1983 between CFC 1978
Partnership C and U.S. Shelter Corporation to acquire Foxfire
Apartments.*
(b) Purchase Agreement dated May 14, 1983 between Old Salem and
U.S. Shelter Corporation to acquire Old Salem Apartments.*
(c) Purchase Agreement dated April 21, 1983 between Europco
Management Company of America and U.S. Shelter Corporation to
acquire Woodland Village Apartments.*
(d) Purchase Agreement dated May 6, 1983 between Europco
Management Company of America and U.S. Shelter Corporation
to acquire Lake Johnson Mews.*
*Filed as Exhibits 12(a) through 12(d), respectively, to
Amendment No. 1 of Registration Statement No. 2-81308 of
Registrant filed May 24, 1983 and incorporated herein by
reference.
(e) Purchase Agreement dated June 17, 1983 between The Lexington
Apartments and U.S. Shelter Corporation to acquire The
Lexington Apartments. (Filed as Exhibit 12(E) to
Post-Effective Amendment No. 1 of Registration Statement No.
2-81308 of Registrant filed June 27, 1983 and incorporated
herein by reference).
(f) Purchase Agreement dated August 26, 1983 between James S.
Quincey and U.S. Shelter Corporation to acquire Millhopper
Village Apartments. (Filed as Exhibit 12(F) to Post-Effective
Amendment No. 1 of Registration Statement No. 2-81308 of
Registrant filed October 13, 1983 and incorporated herein by
reference).
(h) Purchase Agreement dated December 14, 1983 between Virginia
Real Estate Investors and U.S. Shelter Corporation to acquire
Tar River Estates. (Filed as Exhibit 10(B) to Form 8-K of
Registrant dated December 8, 1983 and incorporated herein by
reference).
(iii) Contracts related to refinancing of debt:
(l) Multifamily Note secured by a Mortgage or Deed of Trust dated
October 25, 1999, between Foxfire Apartments V Limited
Partnership and GMAC Commercial Mortgage Corporation relating
to Foxfire Apartments. (Filed as Exhibit 10(1) to Form 10-KSB
of Registrant for period ended November 30, 1999 and
incorporated herein by reference).
(m) Multifamily Note secured by a Mortgage or Deed of Trust dated
November 10, 1999, between Shelter Properties V Limited
Partnership and GMAC Commercial Mortgage Corporation relating
to Old Salem Apartments. (Filed as Exhibit 10(m) to Form
10-KSB of Registrant for period ended November 30, 1999 and
incorporated herein by reference).
(n) Multifamily Note secured by a Mortgage or Deed of Trust dated
December 15, 2000 between New Shelter Properties V Limited
Partnership and Reilly Mortgage Group, Inc. relating to
Lexington Green Apartments. (Filed as Exhibit 10(iii)n to Form
10-KSB of Registrant filed on April 2, 2001 and incorporated
herein by reference).
(o) Multifamily Note dated June 28, 2001, by and between Shelter
Properties V Limited Partnership, a South Carolina limited
partnership, and GMAC Commercial Mortgage Corporation,
relating to Lake Johnson Mews Apartments. (Filed as Exhibit
10(iii)o to Form 10-QSB of Registrant filed on August 13, 2001
and incorporated herein by reference).
(p) Multifamily Note dated June 28, 2001, by and between Shelter
Properties V Limited Partnership, a South Carolina limited
partnership, and GMAC Commercial Mortgage Corporation,
relating to Millhopper Village Apartments. (Filed as Exhibit
10(iii)p to Form 10-QSB of Registrant filed on August 13, 2001
and incorporated herein by reference).
(q) Multifamily Note dated August 30, 2001, by and between Shelter
Properties V Limited Partnership, a South Carolina limited
partnership, and GMAC Commercial Mortgage Corporation,
relating to Woodland Village Apartments. (Filed as Exhibit
10(iii)q to Form 10-QSB of Registrant filed on November 13,
2001 and incorporated herein by reference).
(r) Multifamily Note dated December 28, 2001, by and between New
Shelter V Limited Partnership, a South Carolina limited
partnership, and Lend Lease Mortgage Capital, LP, a Texas
limited partnership. (Filed as Exhibit 10(iii)r to Form 8-K of
Registrant filed on January 14, 2002 and incorporated herein
by reference).
31.1 Certification of equivalent of Chief Executive Officer
pursuant to Securities Exchange Act Rules
13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002.
31.2 Certification of equivalent of Chief Financial Officer pursuant to
Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 Certification of the equivalent of the Chief Executive
Officer and Chief Financial Officer Pursuant to 18 U.S.C.
Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
Exhibit 31.1
CERTIFICATION
I, Martha L. Long, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Shelter Properties
V;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the small business issuer as of, and for, the periods presented in this
report;
4. The small business issuer's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for
the small business issuer and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based
on such evaluation; and
(c) Disclosed in this report any change in the small business issuer's
internal control over financial reporting that occurred during the
small business issuer's most recent fiscal quarter (the small
business issuer's fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to
materially affect, the small business issuer's internal control over
financial reporting; and
5. The small business issuer's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the small business issuer's auditors and the audit
committee of the small business issuer's board of directors (or persons
performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the small business issuer's
ability to record, process, summarize and report financial
information; and
(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the small business
issuer's internal control over financial reporting.
Date: May 13, 2005
/s/Martha L. Long
Martha L. Long
Senior Vice President of
Shelter Realty V Corporation,
equivalent of the chief
executive officer of the
Partnership
Exhibit 31.2
CERTIFICATION
I, Stephen B. Waters, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Shelter Properties
V;
2. Based on my knowledge, this report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the small business issuer as of, and for, the periods presented in this
report;
4. The small business issuer's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for
the small business issuer and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
small business issuer, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based
on such evaluation; and
(c) Disclosed in this report any change in the small business issuer's
internal control over financial reporting that occurred during the
small business issuer's most recent fiscal quarter (the small
business issuer's fourth fiscal quarter in the case of an annual
report) that has materially affected, or is reasonably likely to
materially affect, the small business issuer's internal control over
financial reporting; and
5. The small business issuer's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the small business issuer's auditors and the audit
committee of the small business issuer's board of directors (or persons
performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the small business issuer's
ability to record, process, summarize and report financial
information; and
(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the small business
issuer's internal control over financial reporting.
Date: May 13, 2005
/s/Stephen B. Waters
Stephen B. Waters
Vice President of Shelter
Realty V Corporation,
equivalent of the chief
financial officer of the
Partnership
Exhibit 32.1
Certification of CEO and CFO
Pursuant to 18 U.S.C. Section 1350,
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the Quarterly Report on Form 10-QSB of Shelter Properties V
(the "Partnership"), for the quarterly period ended March 31, 2005 as filed with
the Securities and Exchange Commission on the date hereof (the "Report"), Martha
L. Long, as the equivalent of the chief executive officer of the Partnership,
and Stephen B. Waters, as the equivalent of the chief financial officer of the
Partnership, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the
best of his knowledge:
(1) The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Partnership.
/s/Martha L. Long
Name: Martha L. Long
Date: May 13, 2005
/s/Stephen B. Waters
Name: Stephen B. Waters
Date: May 13, 2005
This certification is furnished with this Report pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Partnership for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended.