U. S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2001.
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT
For the transition period from to
Commission file number 0-21455.
Decade Companies Income Properties - A Limited Partnership
(Exact name of small business issuer as specified in its charter)
State of Wisconsin 39-1518732
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
250 Patrick Blvd., Suite 140 Brookfield, Wisconsin 53045-5864
(Address of principal executive offices)
(262) 792-9200
(Issuer's telephone number)
Not Applicable
Former name, former address and former fiscal year, if changed
since last report)
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 .
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act
after the distribution of securities under a plan confirmed by
court. Yes No .
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: .
Transitional Small Business Disclosure Format (check one): Yes
No X .
Decade Companies Income Properties - A Limited Partnership
Form 10-QSB
INDEX
June 30, 2001
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements (unaudited)
Balance Sheet at June 30, 2001 3
Statements of Operations for the three
and six month periods ended June 30, 2001
and 2000 4
Statements of Partners' Capital
for the six months ended June 30, 2001
and the year ended December 31, 2000. 5
Statements of Cash Flows for the six months
ended June 30, 2001 and 2000. 6
Notes to Financial Statements. 7
Item 2. Management's Discussion and Analysis or Plan
of Operations 7 - 17
PART II. OTHER INFORMATION
Item 5. Other Information 17
Item 6. Exhibits and Reports on Form 8-K. 18
SIGNATURES 18
Exhibit 11 - Statement Re: Computation of Per
Interest Earnings 19
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
BALANCE SHEET
June 30, 2001
(unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 4,340,004
Escrow deposits 11,402
Prepaid expenses and other assets 65,336
Total Current Assets 4,416,742
INVESTMENT PROPERTIES, AT COST: 33,009,288
Less: accumulated depreciation (11,211,148)
Net Investment Property 21,798,140
OTHER ASSETS:
Utility deposits 40,903
Debt issue costs, net of accumulated
amortization 468,301
Total Other Assets 509,204
Total Assets $26,724,086
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES:
Accounts payable and accrued taxes $ 579,380
Unearned rent collections 56,001
Tenant security deposits 113,467
Distributions payable 169,504
Accrued interest payable 19,860
Payables to affiliates 4,020,068
Mortgage notes payable 25,271,154
Total Liabilities 30,229,434
PARTNERS' CAPITAL:
General Partner Capital (98,955)
Limited Partners (authorized--18,000 Interests;
outstanding--13,400.27 Interests at 12/31/00
and 13,397.27 Interests at 06/30/01 (3,406,393)
Total Partners' Capital (3,505,348)
Total Liabilities and Partners' Capital $26,724,086
See Notes to Unaudited Financial Statements.
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended Six Months Ended
6/30/01 6/30/00 6/30/01 6/30/00
Operating revenue:
Rental income $ 1,756,397 $1,712,999 $3,477,957 $3,368,565
Operating expenses (802,312) (813,376) (1,557,637) (1,486,848)
Real estate taxes (190,497) (183,900) (380,994) (367,800)
Total operating
expenses (992,809) (997,276) (1,938,631) (1,854,648)
Net operating income 763,588 715,723 1,539,326 1,513,917
Interest expense (520,984) (505,712) (1,046,048) (1,010,628)
Depreciation (263,000) (255,120) (518,000) (505,600)
Amortization (28,324) (28,326) (56,650) (56,653)
Net income (loss) from
investment property (48,720) (73,435) (81,372) (58,964)
Other income (expenses):
Interest income 50,435 68,250 91,922 110,099
Partnership managmnt (54,321) (52,681) (123,378) (118,365)
(3,886) 15,569 (31,456) (8,266)
NET INCOME (LOSS) $(52,606)$ (57,866) $ (112,828) $ (67,230)
Net income (loss)
attributable to General
Partner(1%) $ (526)$ (579) $ (1,128) $ (672)
Net income (loss)
attributable to Limited
Partners (99%) (52,080) (57,287) (111,700) (66,558)
$ (52,606) $ (57,866) $ (112,828) $ (67,230)
Net income (loss) per Limited
Partner Interest $ (3.89) $ (4.28) $ (8.34) $ (4.97)
See Notes to Unaudited Financial Statements
STATEMENTS OF PARTNERS' CAPITAL
(Unaudited as to the Six Months Ended June 30, 2001)
General Limited
Partner Partners'
Capital Capital Total
BALANCES AT 12/31/99 $(91,792) $(2,239,604) $ (2,331,396)
Distributions to Partners (3,547) (670,016) (673,563)
Net income for the year (488) (48,265) (48,753)
BALANCES AT 12/31/00 $(95,827) $(2,957,885) $(3,053,712)
Distributions to Partners (2,000) (335,008) (337,008)
Interests redeemed 0 (1,800) (1,800)
Net (loss) for the period (1,128) (111,700) (112,828)
BALANCES AT 6/30/01 $(98,955) (3,406,393) $(3,505,348)
() denotes deficit or deduction.
See Notes to Unaudited Financial Statements.
STATEMENTS OF CASH FLOWS - (UNAUDITED)
For The Six Months Ended June 30,
2001 2000
CASH PROVIDED BY (USED FOR) OPERATIONS $ 866,702 $ 849,787
INVESTING ACTIVITIES:
Additions to investment property (226,474) (216,080)
FINANCING ACTIVITIES:
Principal payments on mortgage notes (211,253) (184,810)
Distributions paid to limited partners (335,008) (335,008)
Distributions paid to general partner (3,547) (3,975)
Redemption of Interests (1,800) 0
NET CASH (USED IN) FINANCING ACTIVITIES (551,608) (523,793)
INCREASE (DECREASE) IN CASH & CASH
EQUIVALENTS 88,620 109,914
CASH & CASH EQUIVALENTS AT THE BEGINNING
OF PERIOD 4,251,384 4,570,655
CASH & CASH EQUIVALENTS
AT THE END OF PERIOD $4,340,004 $4,680,569
Supplementary disclosure of cash flow information:
Interest paid $ 996,764 $ 996,379
Income taxes paid 0 0
See Notes to Unaudited Financial Statements
Note A--Basis of Presentation
The accompanying unaudited financial statements have been prepared
in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form
10-QSB and Article 10 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation
have been included. Operating results for the three and six month
periods ended June 30, 2001 are not necessarily indicative of the
results that may be expected for the year ended December 31, 2001.
For further information, refer to the financial statements and
footnotes thereto included in the Partnership's annual report on
Form 10-KSB for the year ended December 31, 2000.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Forward-Looking Information
Forward-looking statements in this report, including without
limitation, statements relating to Decade Companies Income
Properties (the "Partnership") plans, strategies, objectives,
expectations, intentions and adequacy of resources, are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that such
forward-looking statements involve risks and uncertainties
including without limitation the following: (i) the Partnership's
plans, strategies, objectives, expectations and intentions are
subject to change at any time at the discretion of the General
Partner; (ii) the Partnership's plans and results of operations
will be affected by the Partnership's ability to manage its growth
(iii) other risks and uncertainties indicated from time to time in
the Partnership's filings with the Securities and Exchange
Commission.
Information contained in this Quarterly Report on Form 10-QSB
contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995, which can be
identified by the use of forward-looking terminology such as "may,"
"will," "believe," "expect", "anticipate," "estimate", "intend,"
"project," or "continue" or the negative thereof or other
variations thereon or comparable terminology. There are a number
of important factors with respect to such forward looking
statements, including certain risks and uncertainties, that could
cause actual results, performance, or achievements of the
Partnership to differ materially from anticipated future results,
performance or achievements expressed or implied by such forward-
looking statements. Such factors, which could adversely affect the
Partnership's ability to obtain these results, include, but are not
limited to, the following: (i) occupancy levels and market rents
may be adversely affected by local economic and market conditions,
which are beyond the Partnership's control; (ii) debt financing
could adversely affect the Partnership's performance, (iii)
scheduled debt payments could adversely affect the Partnership's
financial condition, (iv) financial covenants could adversely
affect the Partnership's financial condition, (v) the Partnership's
degree of leverage could limit its ability to obtain additional
financing, (vi) control and influence by significant limited
partners could be exercised in a manner adverse to other limited
partners, (vii) environmental problems are possible and can be
costly, (viii) the Partnership's performance and Limited
Partnership Interest value are subject to risks associated with the
real estate industry, (ix) the Partnership may be unable to renew
leases or relet space as leases expire, (x) new real estate
acquisitions may fail to perform as expected, (xi) competition for
real estate acquisitions may result in increased prices for
properties, (xii) because real estate investments are illiquid, the
Partnership may not be able to sell properties when appropriate,
(xiii) changing laws could affect the Partnership's business, (xiv)
provisions in the Limited Partnership Agreement could inhibit
changes in control, (xv) the Partnership depends on key personnel;
and (xvi) other factors described elsewhere in this Quarterly
Report on Form 10-QSB.
Readers are cautioned not to place undue reliance on these forward-
looking statements, which speak only as of the date hereof. The
Partnership undertakes no obligation to publicly release any
revisions to these forward-looking statements, which may be made to
reflect events or circumstances after the date hereof or to reflect
the occurrence of unanticipated events.
The Partnership Agreement provides for termination at December 31,
2005. The three properties owned by the Partnership were acquired
between January 1989 and November 1993.
The General Partner recognizes that each Limited Partner might have
different and, at times, conflicting economic interests with
respect to the Partnership's continuing ownership of the
properties, particular to their individual economic situations.
Some Limited Partners might favor a complete liquidation of the
Limited Partnership and the distribution of all of its assets,
regardless of tax consequences. Other Limited Partners might
prefer continuing their investment in the Limited Partnership,
without change to its holding or investment strategy for the short
term. Other Limited Partners might desire to continue their
investment in the Limited Partnership, but only if it were to
diversify its investment strategies rather than hold the existing
properties.
In view of these conflicting goals of individual Limited Partners,
the General Partner has concluded that it will consider different
approaches to the Limited Partnership's future in order to provide
as much flexibility as possible to Limited Partners to exercise
whatever economic decisions they would deem necessary for their
particular economic situation.
As the Partnership enters the liquidation stage, the General
Partner will consider the benefits of exchanging the real estate
for replacement properties for those Limited Partners who my wish
to extend the life of the Partnership, while accommodating those
Limited Partners who prefer to terminate their investment upon the
sale of the properties.
Results of Operations
Operating revenue from rental income was $1,756,000 in the quarter
ended June 30, 2001, compared to $1,713,000 for the same period in
2000, an increase of 2.5%. Rental income was provided by the
three sites for the comparative three month period as set forth
below:
Percent
Three Months Ended Increase Increase
6/30/01 6/30/00 (Decrease) (Decrease)
Pelican Sound $ 748,000 $ 721,000 $ 27,000 3.7%
Meadows II 579,000 535,000 44,000 8.2%
Town Place 429,000 457,000 (28,000) (6.1%)
Total $1,756,000 $1,713,000 $ 43,000 2.5%
The $43,000 increase in rental income for the second quarter,
compared to the prior year's second quarter, is attributed
primarily to a 3% increase in gross potential rent with average
occupancy at 93% in both quarters. The $43,000 increase consisted
of increases at Meadows II of $44,000 and Pelican Sound of $27,000,
offset by a decrease of $28,000 at Town Place. The $44,000
increase at Meadows II is attributed to a 3% increase in gross
potential rent, plus a 2% increase in average occupancy (from 90%
to 92%). The $27,000 increase at Pelican Sound is attributed to a
5% increase in gross potential rent plus a 2% increase in average
occupancy (from 93% to 95%). The $28,000 decrease at Town Place is
attributed to a 2% increase in gross potential rent, offset by a 4%
decrease in average occupancy (from 95% to 91%).
Operating revenue from rental income for the six month period ended
June 30, 2001 was $3,478,000, compared to $3,369,000 for the same
period in 2000, an increase of 3.2%. Rental income was provided by
the three sites for the comparative six month periods as set forth
below:
Percent
For Six Months Ended Increase Increase
6/30/01 6/30/00 (Decrease) (Decrease)
Pelican Sound $1,473,000 $1,400,000 $ 73,000 5.2%
Meadows II 1,143,000 1,082,000 61,000 5.6%
Town Place 862,000 887,000 (25,000) (2.8%)
Total $3,478,000 $3,369,000 $ 109,000 3.2%
The $109,000 increase in rental income for the six month period,
compared to the prior year's same six month period, is attributed
to a 4% increase in gross potential rent with average occupancy at
92% in both six month periods. The $109,000 increase consisted of
increases at Pelican Sound of $73,000, and Meadows II of $61,000,
offset by a decrease at Town Place of $25,000. The $73,000
increase at Pelican Sound is attributed to a 5% increase in gross
potential rent, plus a 1% increase in occupancy (from 92% to 93%).
The $61,000 increase at The Meadows II is attributed to a 3%
increase in gross potential rent, plus a 2% increase in average
occupancy (from 91% to 93%). The $25,000 decrease at Town Place is
attributed to a 3% increase in gross potential rent, offset by a
decrease in average occupancy of 4% (from 94% to 90%).
The average monthly gross potential rent per unit at the Apartments
for the second quarter of 2001 and for the six month period of
2001, and the comparative periods in 2000, is set forth below:
Number Three Months Ended Six Months Ended
of Units 6/30/01 6/30/00 6/30/01 6/30/00
Pelican Sound 379 $682 $650 $679 $647
The Meadows II 316 $640 $623 $638 $622
Town Place 240 $653 $640 $656 $637
All Rental Units 935 $660 $638 $660 $636
"Gross potential rent" represents the asking rent established by
the Partnership for a vacant apartment plus the rent in effect for
occupied apartments.
The average occupancy level at the Apartments for the second
quarter ended June 30, 2001 and for the six month period of 2001,
and the comparable periods in 2000, is set forth below:
Three Months Ended Six Months Ended
6/30/01 6/30/00 6/30/01 6/30/00
Pelican Sound 94.9% 93.3% 93.4% 92.2%
The Meadows II 92.2% 90.3% 92.8% 91.0%
Town Place 90.9% 94.9% 89.9% 94.2%
All Rental Units 93.0% 92.7% 92.2% 92.3%
The range of occupancy levels at the Apartments for the second
quarter period ended June 30, 2001 and for the six month period of
2001, and the comparable periods in 2000, is set forth below:
Three Months Ended Six Months Ended
6/30/01 6/30/00 6/30/01 6/30/00
Pelican Sound 94.3-96.1% 91.8-95.7% 91.7-96.1% 87.8-95.7%
The Meadows II 89.1-94.3% 88.3-92.4% 89.1-94.6% 88.3-92.4%
Town Place 89.0-92.2% 93.5-96.7% 87.3-92.2% 93.0-96.7%
All Rental Units 92.0-93.7% 91.3-93.6% 90.8-93.8% 90.4-93.6%
Total rental expenses before depreciation and debt service in the
three month period ended June 30, 2001 decreased by $4,000, from
$997,000 to $993,000, compared to the same period of 2000. The
decrease was comprised of a decrease at Pelican Sound of $25,000,
offset by increases at Town Place of $14,000 and Meadows II of
$7,000.
For the six month period total rental expenses increased by $84,000
from $1,855,000 to $1,939,000. The increases were comprised of
increases at The Meadows II of $62,000, and at Town Place of
$36,000, offset by a decrease at Pelican Sound of $14,000.
A summary of operating expenses before depreciation and debt
service by apartment site follows:
For the Three Months Ended
Increase Increase
(Decrease) (Decrease)
6/30/01 6/30/00 Amount Percent
Pelican Sound $405,000 $430,000 $(25,000) (5.8%)
Meadows II 300,000 293,000 7,000 2.4%
Town Place 288,000 274,000 14,000 5.1%
Total $993,000 $997,000 $ (4,000) 0.4%
For The Six Months Ended
Increase Increase
(Decrease) (Decrease)
6/30/01 6/30/00 Amount Percent
Pelican Sound $ 781,000 $ 795,000 $(14,000) (1.8%)
Meadows II 635,000 573,000 62,000 10.8%
Town Place 523,000 487,000 36,000 7.4%
Total $1,939,000 $1,855,000 $ 84,000 4.5%
The $62,000 increase in operating expenses at The Meadows II is
primarily attributable to an increase in utilities expense of
$29,000, an increase in insurance expense of $16,000, an increase
in the cost of snow removal of $7,000, a decrease in outside
contractor painting expenses of $6,000, and an increase in property
management fees (attributable to higher rent collections) of
$16,000.
The $36,000 increase in operating expenses at Town Place is
primarily attributable to an increase in advertising expenses of
$7,000, an increase in apartment painting of $2,000, an increase in
property taxes of $5,000, an increase in property management
expenses (attributable to higher rent collections) of $2,000, an
increase in utilities of $6,000, and an increase in management
personnel of $14,000.
The $14,000 decrease in operating expenses at Pelican Sound is
primarily attributable to a decrease in property taxes of $8,000,
an increase in the water recovery due on the new meter of $11,000,
offset by an increase in onsite personnel of $5,000.
As a result of foregoing, net income from rental property
operations before debt service, depreciation and amortization, is
approximately $763,000 for the second quarter of 2001, compared to
$716,000 for the comparative period, an increase of approximately
$47,000. The net increase is comprised of an increase at Pelican
Sound of $54,000, and an increase at The Meadows II of $36,000,
offset by a decrease at Town Place of $43,000.
For the six month period net income from rental operations before
depreciation, amortization, and debt service is approximately
$1,539,000 for the 2001 period compared to $1,514,000 for the
comparable 2000 period, an increase of $25,000. The increase is
comprised of an increase at Pelican Sound of $87,000, offset by
decreases at Town Place of $61,000, and the Meadows II of $1,000.
As a result of the foregoing, a summary of net operating income
before depreciation, amortization, and debt service, by site
including the percent of total for each site for three month
periods ended follows:
Increase Increase
6/30/01 6/30/00 (Decrease)(Decrease)
Amount Percent Amount Percent Amount Percent
Pelican Sound $344,000 45% $290,000 40% $ 54,000 18.6%
Meadows II 278,000 36% 242,000 34% 36,000 14.9%
Town Place 141,000 19% 184,000 26% (43,000) (23.4%)
Total $763,000 100% $716,000 100% $ 47,000 6.6%
A summary of net operating income before depreciation,
amortization, and debt service, by site for the six month periods
ended follows:
Increase Increase
6/30/01 6/30/00 (Decrease) (Decrease)
Amount Percent Amount Percent Amount Percent
Pelican Sound $ 692,000 45% $ 605,000 40% $ 87,000 14.4%
Meadows II 508,000 33% 509,000 34% (1,000) (0.2%)
Town Place 339,000 22% 400,000 26% (61,000) (15.3%)
Total $1,539,000 100% $1,514,000 100% $ 25,000 1.7%
Interest expense for the second quarter of 2001 increased $15,000
from the comparative period and increased $35,000 for the six month
period, primarily as a result of interest accrued on the deferred
fees payable to the General Partner which were due and payable on
January 1. Interest was computed at 4.35% per annum, which was the
average rate earned by the Partnership on its cash reserves.
The net income before debt service from real estate activities is
reduced by deductions for depreciation and amortization which do
not affect cash flow. Depreciation and amortization increased
$8,000 for the second quarter of 2001 compared to 2000, and by
$12,000 for the six month period.
The Partnership's net other expenses decreased during the second
quarter in 2001 by approximately $19,000. The $19,000 decrease
consisted of a decrease in interest income of $17,000 and an
increase in partnership management expenses of $2,000.
The Partnership's net other expenses decreased during the six month
period in 2001 by approximately $23,000. The $23,000 decrease
consisted of a decrease in interest income of $18,000 and an
increase in partnership management expenses of $5,000. The
decreased interest income is attributable to a lessor investment
portfolio available to generate such income.
As a result of the foregoing, the Partnership's net loss for the
quarter ended June 30, 2001 was $53,000, compared to a loss of
$58,000 in the same period of 2000. For the six month periods the
Partnership's net loss for 2001 was $113,000, compared to net loss
of $67,000 for 2000.
Exclusive of depreciation and amortization, the Partnership's net
income for the quarters ended June 30, 2001 and 2000 was $239,000
and $226,000, and for the six month periods the net income
exclusive of depreciation and amortization was $462,000 of 2001 and
$495,000 for 2000.
Liquidity and Sources of Capital
At June 30, 2001 there was $4.35 million of cash and cash
equivalents and escrow deposits available to pay liabilities. The
Partnership has a credit line established of approximately $2.56
million from the undisbursed funds from The Meadows II refinancing
to provide additional liquidity. The undisbursed funds do not bear
interest until they are released by the mortgage lender. The cash
balance averaged $4.25 million during the six month period.
During the first six months of 2001, cash and cash equivalents
increased by $88,000 as shown herein on the Statements of Cash
Flows. Operating activities provided $867,000 during the quarter.
The cash flow was used to make cash distributions to the partners
of approximately $339,000. Approximately $92,000 (32.5% of the
cash distributions) was considered to be portfolio income subject
to income taxes. The Partnership used $1,800 to purchase and
retire three limited partner Interests. The balance of the cash
flow provided by operations was used to make principal payments on
the outstanding mortgage notes of $211,000, to purchase capitalized
additions to the investment properties of $226,000, and to increase
cash reserves.
The General Partner believes that the Partnership has the ability
to generate adequate amounts of cash to meet the Partnership's
current needs for the foreseeable future.
Short-term obligations total $4.5 million, consisting of $938,000
of current liabilities, $426,000 of mortgage principal liabilities,
and as described in detail below, $3,132,000 payable to the General
Partner and affiliates.
On a short-term basis, rental operations are expected to provide a
stream of cash flow to pay day-to-day operating expenses and to
fund quarterly cash distributions to partners. Investment property
operations generated a profit in the second quarter of 2001 of
$275,000 (before depreciation and amortization of $291,000)
compared to $211,000 for the same period in 2000.
For the six month period net income from investment properties
generated a profit of $559,000 for year 2001 (before depreciation
and amortization of $575,000) compared to $503,000 for the same
period in 2000.
The Agreement of Limited Partnership provides that the Partnership
will make distributions for each calendar quarter of cash flow less
amounts set aside for reserves. In April the Partnership paid to
the Limited Partners the March declaration of $167,500 ($12.50 per
Interest) and declared for the nineteenth consecutive quarter a
similar amount payable for the second quarter of 2001 to be paid in
July 2001. The distribution payable to the General Partner of
$2,000 was accrued and payment will be made subsequently. The
Partnership intends, but is not required, to continue to make cash
distributions to the Limited Partners each quarter in the same
amount of 5.0% per annum on the original capital investment of
$1,000 per Interest. This intention will require cash
distributions to the limited partners of approximately $670,000 in
the next 12 months, which should be met from operations and cash
reserves. Through June 30, 2001 the Partnership declared cash
distributions of approximately $14.2 million (79% of original
capital) to the Limited Partners since inception. Cumulative cash
distributions range from $795 (80%) to $942 (94%) per $1,000
Interest of an original holder, depending upon the date of
purchasing the Interest.
The long-term mortgage obligations of the Partnership require
principal reductions (excluding balloon payments) of approximately
$2.0 million over the next five years. These obligations will most
likely be satisfied by cash generated from operations. The Town
Place loan is due in 2003 and will require a balloon payment of
approximately $6.1 million. The Meadows II loan is due in 2005 and
will require a balloon payment of approximately $5.7 million. The
Pelican Sound note is due in 2006 and will require a balloon
payment of approximately $6.0 million. It is anticipated that all
three properties will be sold or refinanced prior to the maturity
dates.
The mortgage notes on Pelican Sound, Town Place and Meadows II bear
interest at 7.50%, 8.25%, and 7.25% respectively. The Partnership
is exploring the possibility of refinancing the Town Place mortgage
loan during 2001 if lower interest rates are available. Additional
proceeds from the refinancing in excess of the existing mortgage
debt would provide additional liquidity.
Approximately $3.9 million of deferred fees and deferred interest
related thereto has been earned by the General Partner and
affiliates, of which approximately $3.0 million was a short term
obligation of the Partnership currently due and was paid in July
2001.
Other than the payments described above, there are no long-term
material capital expenditures, obligations, or other demands or
commitments that might impair the liquidity of the Partnership.
Partners' Capital decreased by $452,000 during the first six months
of 2001 due to cash distributions declared payable to the partners
of $337,000, plus by the net loss for the six month period of
$113,000 and the three limited partner Interests that were
purchased for $1,800 and retired.
PART II.
OTHER INFORMATION
Items 1 - 5.
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
The following exhibit is included herein:
(11) Statement re: Computation of Earnings Per Interest
The Partnership did not file any reports on Form 8-K during the
three months ended June 30, 2001.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
DECADE COMPANIES INCOME PROPERTIES -
A LIMITED PARTNERSHIP
(Registrant)
By: DECADE COMPANIES
(General Partner)
Date: August 13, 2001 By: /s/ Jeffrey Keierleber
Jeffrey Keierleber
General Partner and Principal
Financial and Accounting Officer
of Registrant
Decade Companies Income Properties
Exhibit 11 - Statement Re: Computation of Per Interest Earnings
June 30, 2001
The following table sets forth the computation of earnings per
Interest:
Three Months Ended Six Months Ended
6/30/01 6/30/00 6/30/01 6/30/00
Numerator
Net loss attributable
to Limited Partners 99% $(52,080) $(57,287) $(111,700) $(66,558)
Denominator
Denominator for basic
earnings per Interest
weighted-average
Interest 13,399.27 13,400.27 13,399.77 13,400.27
Net loss per Interest $(3.89) $(4.28) $(8.34) $(4.97)