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, 2005
/___/ Transition report pursuant to Section 13 or 15(d) of the
Securities Act of 1934
for the transition period from ______________ to ________________.
Commission File Number 2-96364
DSI REALTY INCOME FUND IX, A California Limited Partnership
(Exact name of registrant as specified in its charter)
California_______________________________________33-0103989
(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.
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
CONSOLIDATED BALANCE SHEETS(UNAUDITED)
SEPTEMBER 30, 2005 AND DECEMBER 31, 2004
September 30, December 31,
2005 2004
ASSETS
CASH AND CASH EQUIVALENTS $ 482,241 $ 486,736
PROPERTY, NET 3,325,595 3,670,725
OTHER ASSETS 93,281 81,403
---------- ----------
TOTAL $3,901,117 $4,238,864
========== ==========
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES
Distribution to Partners $ 232,523 $ 310,030
Capital lease obligation 154,638 195,138
Other liabilities 383,753 341,066
---------- ----------
770,914 846,234
---------- ----------
MINORITY INTEREST IN
REAL ESTATE JOINT VENTURE 182,061 179,703
PARTNERS' EQUITY (DEFICIT):
General Partners (107,960) (105,312)
Limited Partners 3,056,102 3,318,239
---------- ----------
Total partners' equity 2,948,142 3,212,927
---------- ----------
TOTAL $3,901,117 $4,238,864
========== ==========
See accompanying notes to consolidated financial statements.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
September 30, September 30,
2005 2004
REVENUES:
Rental $ 736,887 $ 661,370
---------- ----------
EXPENSES:
Operating 450,351 400,896
General and administrative 41,103 41,761
---------- ----------
Total expenses 491,454 442,657
---------- ----------
OPERATING INCOME 245,433 218,713
OTHER INCOME
Interest 48 131
---------- -----------
INCOME BEFORE MINORITY INTEREST
IN INCOME OF REAL ESTATE
JOINT VENTURE 245,481 218,844
MINORITY INTEREST IN INCOME
OF REAL ESTATE JOINT VENTURE (30,634) (28,698)
---------- ----------
NET INCOME $ 214,847 $ 190,146
========== ==========
AGGREGATE NET INCOME ALLOCATED TO:
Limited partners $ 212,699 $ 188,245
General partners 2,148 1,901
---------- ----------
TOTAL $ 214,847 $ 190,146
========== ==========
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 6.93 $ 6.13
========== ==========
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 30,693 30,693
====== ======
See accompanying notes to consolidated financial statements.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
September 30, September 30,
2005 2004
REVENUES
Rental $2,059,112 $2,011,819
---------- ----------
EXPENSES:
Operating 1,368,313 1,178,285
General and administrative 175,499 187,440
---------- ----------
Total expenses 1,543,812 1,365,725
---------- ----------
OPERATING INCOME 515,300 646,094
OTHER INCOME
Interest 241 391
---------- ----------
INTEREST BEFORE MINORITY
INTEREST IN INCOME OF REAL
ESTATE JOINT VENTURE 515,541 646,485
MINORITY INTEREST IN INCOME
OF REAL ESTATE JOINT VENTURE (82,758) (87,923)
--------- ---------
NET INCOME $ 432,783 $ 558,562
========= =========
AGGREGATE NET INCOME ALLOCATED TO:
Limited Partners $ 428,455 $ 552,976
General Partners 4,328 5,586
--------- ---------
TOTAL $ 432,783 $ 558,562
========= =========
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 13.96 $ 18.02
========= =========
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 30,693 30,693
====== ======
See accompanying notes to consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIT)(UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005
GENERAL LIMITED
PARTNERS PARTNERS TOTAL
BALANCE AT JANUARY 1, 2005 ($105,312) $3,318,239 $3,212,927
NET INCOME 4,328 428,455 432,783
DISTRIBUTIONS (6,976) (690,592) (697,568)
--------- ---------- ----------
BALANCE AT SEPTEMBER 30, 2005 ($107,960) $3,056,102 $2,948,142
========= ========== ==========
See accompanying notes to consolidated financial statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005 AND 2004
September 30, September 30,
2005 2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 432,783 $ 558,562
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 345,130 313,610
Minority interest in income
real estate joint venture 82,758 87,923
Changes in assets and
liabilities:
Increase in other assets (11,878) (27,637)
Decrease in liabilities (75,320) (108,101)
-------- --------
Net cash provided by
operating activities 773,473 824,357
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES -
Distributions to partners (697,568) (971,944)
Distributions paid to minority
interest in real estate
joint venture (80,400) (87,300)
-------- --------
Net cash used in
financing activities (777,968) (1,059,244)
-------- --------
NET DECREASE IN CASH AND
CASH EQUIVALENTS (4,495) (234,887)
CASH AND CASH EQUIVALENTS:
At beginning of period 486,736 732,355
--------- ---------
At end of period $ 482,241 $ 497,468
========= =========
See accompanying notes to consolidated financial statements.
DSI REALTY INCOME FUND IX
(A California Real Estate Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. GENERAL
DSI Realty Income Fund IX (the "Partnership"), a limited partnership, has
three general partners (DSI Properties, Inc., Robert J. Conway and
Joseph W. Conway) and limited partners owning 30,693 limited partnership
units.
The Partnership has acquired five mini-storage facilities located in
Monterey Park and Azusa, California; Everett, Washington;and Romeoville and
Elgin, Illinois. The Partnership has also entered into a joint venture with
DSI Realty Income Fund VIII, a related party, through which the Partnership
has a 70% interest in a mini-storage facility in Aurora, Colorado and DSI
Realty Income Fund VIII has a 30% interest. The Partnership is a general
partner in the joint venture. The facilities were acquired from Dahn
Corporation ("Dahn"). Dahn is not affiliated with the Partnership. Dahn
is affiliated with other partnerships in which DSI Properties, Inc.,
Robert J. Conway and Joseph W. Conway are the general partners. The mini-
storage facilities are operated for the Partnership by Dahn under various
agreements which are subject to renewal annually. Under the terms of the
agreements, the Partnership is required to pay Dahn a property management
fee equal to 5% of gross revenue from operations, defined as the entire
amount of all receipts from the renting or leasing of storage compartments
and sale of locks. The Partnership and DSI Realty Income Fund VIII both
have DSI Properties, Inc. as one of the general partners and both of their
facilities are managed by Dahn.
The accompanying consolidated financial information as of September 30, 2005,
and for the periods ended September 30, 2005 and 2004 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
The Partnership owns five mini-storage facilities located in Monterey Park
and Azusa, California; Everett, Washington; and Romeoville and Elgin,
Illinois. The Partnership also owns a 70% interest in a mini-storage
facility in Aurora, Colorado. The total cost and accumulated depreciation
of the mini-storage facilities are as follows:
September 30, 2005 December 31, 2004
Land $ 2,729,790 $ 2,729,790
Buildings and equipment 11,032,676 11,032,676
Equipment 275,042 275,042
------------ ------------
Total 14,037,508 14,037,508
Less: Accumulated Depreciation (10,711,913) (10,366,783)
------------ ------------
Property - Net $ 3,325,595 $ 3,670,725
============ ============
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.
4. ALLOCATION OF PROFITS AND LOSSES AND GENERAL PARTNERS' INCENTIVE
MANAGEMENT FEE
Under the Agreement of limited Partnership, the general partners are to
be allocated 1% of the net profits or losses from operations, and the
limited partners are to be allocated the balance of the net profits or
losses from operations in proportion to their limited partnership
interests.
The General Partners are also entitled to receive a percentage, based on
a predetermined formula, of any cash distribution from the sale, other
disposition or refinancing of the project.
In addition, the General Partners are entitled to receive an incentive
management fee for supervising the operations of the Partnership. The
fee is to be paid in an amount equal to 9% per annum of the cash available
for distribution on a cumulative basis, calculated as cash generated from
operations less capital expenditures.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
We are pleased to enclose the Partnership's unaudited consolidated financial
statements for the period ended September 30, 2005. 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, 2005 and 2004, total revenues
increased 11.4% from $661,370 to $736,887 and total expenses increased 11.0%
from $442,657 to $491,454 and other income decreased from $131 to $48.
Minority interest in income of real estate joint venture increased 6.7% from
$28,698 to $30,634 as a result of higher rental revenue at that facility. As
a result, net income increased 13.0% from $190,146 to $214,847 for the three-
month period ended September 30, 2005, as compared to the same period in 2004.
Rental revenue increased as a result of higher occupancy and unit rental
rates. Occupancy levels for the Partnership's six mini-storage facilities
averaged 79.3% for the three-month period ended September 30, 2005 as compared
to 73.5% for the same period in 2004. The Partnership is continuing its
marketing efforts to attract and keep new tenants in its various mini-storage
facilities. Operating expenses increased approximately $49,500 (12.3%) due
primarily to an increase in advertising, real estate tax, salaries and wages,
travel, truck insurance and maintenance and depreciation. General and admini-
strative remained constant as a decrease in incentive management fees was
partially offset by an increase in equipment and computer lease expenses.
For the nine-month period ended September 30, 2005, and 2004, total revenues
increased 2.4% from $2,011,819 to $2,059,112 and total expenses increased 13.0%
from $1,365,725 to $1,543,812 and other income decreased from $391 to $241.
Minority interest in income of real estate joint venture decreased 5.9% from
$87,923 to $82,758. As a result, net income decreased 22.5% from $558,562
to $432,783 for the nine-month period ended September 30, 2005, as compared
to the same period in 2004. Rental revenue increased as a result of higher
occupancy and unit rental rates. Operating expenses increased approximately
$190,000 (16.1%) due primarily to increases in advertising, maintenance and
repair, purchase of locks and packing materials, real estate tax, salaries
and wages, truck insurance and maintenance, travel and depreciation expenses,
partially offset by a decrease in security alarm services expense. General
and administrative expenses decreased approximately $11,900 (6.3%) primarily
as a result of a decease in incentive management fees, partially offset by
an increase in equipment and computer lease expense. Minority interest in
income of real estate joint venture decreased as a result of higher operating
expenses at that facility.
The General Partners plan to continue their policy of funding improvements
and maintenance of Partnership properties with cash generated from
operations. The Partnership's 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.
Item 3. Quantative and Qualitative Disclosures About Market Risk
NONE
Item 4. CONTROLS AND PROCEDURES
Within 90 days prior to the date of this report, the Partnership evaluated
the effectiveness of its disclosure controls and procedures. This evaluation
was performed by the Partnership's Controller with the assistance of the
President and Chief Executive Officer. These disclosure controls and pro-
cedures are designed to ensure that the information required to be disclosed
by the Partnership in its periodic reports filed with the Securities and Ex-
change Commission (the Commission) is recorded, processed, summarized and
reported, within the time periods specified by the Commissions rules and forms
and that the information is communicated to the certifying officers on a timely
basis. Based on this evaluation, the Partnership concluded that its disclosure
controls and procedures were effective. There have been no significant changes
in the Partnership's internal controls or in other factors that could signifi-
cantly affect the internal controls subsequent to the date of their
evaluation.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Registrant is not a party to any material pending legal proceedings.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
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. 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, 2005.
(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, 2005 DSI REALTY INCOME FUND IX
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, 2005 DSI REALTY INCOME FUND IX
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
CERTIFICATIONS
I, Robert J. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund IX;
2. Based on my knowledge, this quarterly 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 cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15e and 15d-15e) for the registrant and have:
a) designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our super-
vision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this
quarterly report is being prepared;
b) evaluated the effectiveness of the registrant'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 registrant's internal
control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in
the case of our annual report) that has materially affected, or is
control over financial reporting; and
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation of internal control over financial reporting,
to the registrant's auditors:
a) all significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to affect the registrant's ability to record, pro-
cess, 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 registrant's in-
ternal controls over financial reporting.
Date: October 31, 2005
Robert J. Conway
Chief Executive Officer
CERTIFICATIONS
I, Richard P. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund IX;
2. Based on my knowledge, this quarterly 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 cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15e and 15d-15e) for the registrant and have:
a) designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our super-
vision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this
quarterly report is being prepared;
b) evaluated the effectiveness of the registrant'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 registrant's internal
control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in
the case of our annual report) that has materially affected, or is
control over financial reporting; and
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation of internal control over financial reporting,
to the registrant's auditors:
a) all significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to affect the registrant's ability to record, pro-
cess, 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 registrant's in-
ternal controls over financial reporting.
Date: October 31, 2005
Richard P. Conway
Vice President
CERTIFICATION 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 of DSI Realty Income Fund IX (the
"Partnership") on Form 10-Q for the period ending September 30, 2005 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Robert J. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(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 result of operations of the
Partnership.
Robert J. Conway
Chief Executive Officer
October 31, 2005
CERTIFICATION 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 of DSI Realty Income Fund IX (the
"Partnership") on Form 10-Q for the period ending September 30, 2005 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Richard P. Conway, Vice President of the Corporate General Partner, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(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 result of operations of the
Partnership.
Richard P. Conway
Vice President
October 31, 2005