UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One) X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1994
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 0-13329
HUTTON/CONAM REALTY INVESTORS 4
(Exact name of registrant as specified in its charter)
California 11-2685746
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3 World Financial Center, 29th Floor, New York, NY 10285
(Address of principal executive offices) (Zip Code)
(212) 526-3237
(Registrant's telephone number, including area code)
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 Consolidated
Consolidated Balance Sheets
June 30, December 31,
Assets 1994 1993
Investments in real estate:
Land $12,088,984 $12,088,984
Buildings and improvements 48,219,666 48,197,685
60,308,650 60,286,669
Less accumulated depreciation (17,879,336) (16,862,076)
42,429,314 43,424,593
Cash and cash equivalents 2,779,404 2,201,276
Other assets 20,752 20,322
Total Assets $45,229,470 $45,646,191
Liabilities and Partners' Capital
Liabilities:
Mortgage payable $5,071,457 $5,090,828
Distribution payable 640,550 640,550
Accounts payable and accrued
expenses 538,427 138,609
Due to general partners and
affiliates 49,070 51,520
Security deposits 273,960 273,191
Total Liabilities 6,573,464 6,194,698
Partners' Capital (Deficit):
General Partners (373,035) (584,636)
Limited Partners 39,029,041 40,036,129
Total Partners' Capital 38,656,006 39,451,493
Total Liabilities and
Partners' Capital $45,229,470 $45,646,191
Consolidated Statements of Operations
Three months ended Six months ended
June 30, June 30,
Income 1994 1993 1994 1993
Rental $1,882,931 $1,780,478 $3,767,816 $3,557,842
Interest 13,509 11,167 24,679 22,925
Total Income 1,896,440 1,791,645 3,792,495 3,580,767
Expenses
Property operating 984,394 916,602 1,941,037 1,876,415
Depreciation 508,630 507,588 1,017,260 1,015,266
Interest 128,538 129,477 257,319 259,176
General and administrative 41,675 48,703 91,266 96,515
Total Expenses 1,663,237 1,602,370 3,306,882 3,247,372
Net income $ 233,203 $ 189,275 $ 485,613 $ 333,395
Net Income Allocated:
To the General Partners $ 160,252 $ 115,293 $ 339,711 $ 185,519
To the Limited Partners 72,951 73,982 145,902 147,876
$ 233,203 $ 189,275 $ 485,613 $ 333,395
Per limited partnership
unit (128,110 outstanding) $.57 $.58 $1.14 $1.15
Consolidated Statement of Partners' Capital
For the six months ended June 30, 1994
General Limited Total
Partners' Partners' Partners'
Deficit Capital Capital
Balance at January 1, 1994 $(584,636) $40,036,129 $39,451,493
Net income 339,711 145,902 485,613
Cash distributions (128,110) (1,152,990) (1,281,100)
Balance at June 30, 1994 $(373,035) $39,029,041 $38,656,006
Consolidated Statements of Cash Flows
For the six months ended June 30, 1994 and 1993
Cash Flows from Operating Activities: 1994 1993
Net income $ 485,613 $333,395
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation 1,017,260 1,015,266
Increase (decrease) in cash arising
from changes in operating assets
and liabilities:
Other assets (430) 0
Accounts payable and accrued expenses 399,818 376,871
Due to general partners and affiliates (2,450) 1,875
Security deposits 769 17,020
Net cash provided by operating activities 1,900,580 1,744,427
Cash Flows from Investing Activities:
Buildings and improvements (21,981) (54,590)
Net cash used for investing activities (21,981) (54,590)
Cash Flows from Financing Activities:
Mortgage principal payments (19,371) (17,513)
Distributions (1,281,100) (1,245,514)
Net cash used for financing activities (1,300,471) (1,263,027)
Net increase in cash and cash equivalents 578,128 426,810
Cash and cash equivalents at beginning of period 2,201,276 2,049,371
Cash and cash equivalents at end of period $2,779,404 $2,476,181
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for interest $ 257,319 $ 259,176
Notes to the Consolidated Financial Statements
The unaudited interim financial statements should be read in conjunction with
the Partnership's annual 1993 audited financial statements within Form 10-K.
The unaudited financial statements include all adjustments consisting of only
normal recurring accruals which are, in the opinion of management, necessary to
present a fair statement of financial position as of June 30, 1994 and the
results of operations, changes in partners' capital, and cash flows for the six
months then ended. Results of operations for the period are not necessarily
indicative of the results to be expected for the full year.
No significant events have occurred subsequent to fiscal year 1993, and no
material contingencies exist, which would require disclosure in this interim
report per Regulation S-X, Rule 10-01, Paragraph (a)(5).
Part 1, Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Liquidity and Capital Resources
At June 30, 1994, the Partnership had cash and cash equivalents of $2,779,404
compared with $2,201,276 at December 31, 1993. The increase is primarily
attributable to net cash from operations exceeding capital improvement
expenditures, mortgage principal payments and distributions to limited
partners. The Partnership expects sufficient cash flow to be generated from
operations to meet its current operating expenses and debt service
requirements.
The Partnership's 1994 second quarter cash distribution in the amount of $4.50
per Unit will be paid on August 15, 1994. The General Partners have determined
that the Partnership's operating cash flow and cash reserves are sufficient to
meet the Partnership's current operating expenses and projected capital
expenditures and anticipate that cash distributions will be maintained through
1994. The level of future distributions will be reviewed on a quarterly basis.
Accounts payable and accrued expenses were $538,427 at June 30, 1994 compared
with $138,609 at December 31, 1993. The increase reflects the accrual of real
estate taxes for the first six months of 1994.
Results of Operations
Net income for the three and six month periods ended June 30, 1994 totalled
$233,203 and $485,613 respectively, compared with net income of $189,275 and
$333,395 for the corresponding periods in 1993. After adding back
depreciation, a non-cash expense, and subtracting mortgage amortization,
operations generated cash flow of $732,025 and $1,483,502 for the three and six
months ended June 30, 1994, compared with cash flow of $687,996 and $1,331,148
for the corresponding periods in 1993. The increase in net income and cash
flow is primarily attributable to an increase in rental income, partially
offset by higher property operating expense.
Rental income for the three and six month periods ended June 30, 1994 totalled
$1,882,931 and $3,767,816 respectively, compared with $1,780,478 and $3,557,842
for the corresponding periods in 1993. The increase in 1994 reflects increased
revenues at all six properties due to rental rate increases instituted during
the past year.
Property operating expenses for the three and six month periods ended June 30,
1994 totalled $984,394 and $1,941,037 respectively, compared with $916,602 and
$1,876,415 for the corresponding periods in 1993. The increase is due
primarily to expenditures related to the repair and sealing of a parking lot
and carpet replacements for Cypress Lakes, and roof and general repairs for
Trails at Meadowlakes.
For the three and six month periods ended June 30, 1994 and 1993, average
occupancy levels at each of the properties were as follows:
Three Months Ended Six Months Ended
June 30, June 30,
Property 1994 1993 1994 1993
Cypress Lakes 95% 97% 96% 98%
Pelican Landing 97% 93% 98% 95%
River Hill 95% 96% 96% 95%
Shadowood Village 95% 95% 95% 96%
Trails at Meadow Lakes 96% 94% 97% 96%
Village at Foothills II 94% 95% 96% 95%
PART II OTHER INFORMATION
Items 1-4 Not applicable
Item 5 Other information.
Effective May 20, 1994, American Express Company ("American Express")
distributed to holders of record of American Express, shares of Lehman
Brothers Holdings Inc. ("Lehman Brothers") common stock. As a result
of this transaction, the Partnership's General Partner RI 3-4 Real
Estate Services, Inc. is no longer an affiliate of American Express.
This change is not expected to have any impact on the Partnership.
Item 6 Exhibits and Reports on Form 8-K.
(a) Exhibits - None
(b) Reports on Form 8-K - No reports on Form 8-K were filed during
the three month period covered by this report.
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.
HUTTON/CONAM REALTY INVESTORS 4
BY: RI 3-4 REAL ESTATE SERVICES, INC.
General Partner
Date: August 12, 1994 BY: s/Paul L. Abbott/
Title: Director and President