FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended SEPTEMBER 30, 1996
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 0-16805
ASSOCIATED PLANNERS REALTY FUND
(Exact name of registrant as specified in its charter)
CALIFORNIA 95-4036980
(State or other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5933 W. CENTURY BLVD., SUITE 900
LOS ANGELES, CALIFORNIA 90045
(Address of principal executive offices)
(Zip Code)
(310) 670-0800
(Registrant's telephone number, including area code)
(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
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 1. FINANCIAL STATEMENTS
In the opinion of the General Partner of Associated Planners Realty Fund
(the "Partnership"), all adjustments necessary for a fair presentation of the
Partnership's results for the three and nine months ended September 30, 1996
and 1995, have been made in the following financial statements which are of
normal recurring entries in nature. However, such financial statements are
unaudited and are subject to any year-end adjustments that may be necessary.
BALANCE SHEETS
SEPTEMBER 30, 1996 (UNAUDITED) AND DECEMBER 31, 1995
SEPTEMBER 30, DECEMBER 31,
1996 1995
ASSETS
RENTAL REAL ESTATE, net of accumulated
depreciation (Note 2) $5,748,155 $5,843,681
CASH 115,396 103,300
OTHER ASSETS 28,640 64,089
$5,892,191 $6,011,070
LIABILITIES AND PARTNERS' EQUITY
CONSTRUCTION LOAN PAYABLE $1,218,792 $1,225,950
ACCOUNTS PAYABLE 3,680 29,036
SECURITY DEPOSITS AND PREPAID RENT 49,726 44,848
TOTAL LIABILITIES 1,272,198 1,299,834
MINORITY INTEREST (Note 1) 216,535 232,968
COMMITMENTS AND CONTINGENCIES (Note 5)
PARTNERS' EQUITY
Limited Partner:
$1,000 stated value per unit;
authorized 7,500 units;
issued - 7,499 4,363,504 4,133,882
General Partner: 39,954 344,386
TOTAL PARTNERS EQUITY 4,403,458 4,478,268
$5,892,191 $6,011,070
[FN]
See accompanying notes to financial statements.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF PARTNERS' EQUITY
NINE MONTHS ENDED SEPTEMBER 30, 1996
(UNAUDITED)
LIMITED PARTNERS GENERAL
TOTAL UNITS AMOUNT PARTNER
BALANCE, DECEMBER 31, 1995 $4,478,268 7,499 $4,133,882 $344,386
Net income 120,498 --- 99,851 20,647
Distributions to limited
partners (175,777) --- (175,777) ---
Distribution to General
Partner (19,531) --- --- (19,531)
Reallocation of balances
prior to January 1, 1996
(Note 7) --- --- 305,548 (305,548)
BALANCE, SEPTEMBER 30, 1996 $4,403,458 7,499 $4,363,504 $39,954
NINE MONTHS ENDED SEPTEMBER 30, 1995
(UNAUDITED)
LIMITED PARTNERS GENERAL
TOTAL UNITS AMOUNT PARTNER
BALANCE, DECEMBER 31, 1994 $5,985,898 7,499 $5,653,977 $331,921
Net income 251,516 --- 217,851 33,665
Distributions to limited
partners (1,657,040) --- (1,657,040) ---
Distribution to General
Partner (15,222) --- --- (15,222)
BALANCE, SEPTEMBER 30, 1995 $4,565,152 7,499 $4,214,788 $350,364
[FN]
See accompanying notes to financial statements
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF INCOME
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
THREE THREE NINE NINE
MONTHS MONTHS MONTHS MONTHS
ENDED ENDED ENDED ENDED
SEPTEMBER SEPTEMBER SEPTEMBER SEPTEMBER
30, 30, 30, 30,
1996 1995 1996 1995
REVENUES:
Rental $183,995 $131,182 $536,092 $472,953
Gain on sale of property --- --- --- 116,749
Interest 3,028 3,794 6,730 14,516
187,023 134,976 542,822 604,218
COST AND EXPENSES:
Operating 48,609 36,960 140,115 119,380
Property taxes 7,965 7,274 23,561 32,197
Property management
fees-Note 3(c) 9,226 5,544 26,536 22,337
General and administrative 15,338 27,159 42,013 83,230
Depreciation 31,842 27,771 95,526 94,594
Interest expense 36,962 --- 78,139 ---
149,942 104,708 405,890 351,678
LESS MINORITY INTEREST
IN NET (INCOME) LOSS OF
JOINT VENTURE (1,619) 2,507 16,434 1,024
NET INCOME $38,700 $27,761 $120,498 $215,516
NET INCOME PER
LIMITED PARTNERSHIP UNIT $4.26 $3.00 $13.32 $29.05
[FN]
See accompanying notes to financial statements.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(UNAUDITED)
NINE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996 1995
Cash flows from operating activities:
Net income $120,498 $251,516
Adjustment to reconcile net income to
net cash provided by operating activities:
Depreciation 95,526 94,594
Proceeds from sale of investment
in government securities account --- 55,898
Unrealized loss - (gain)
Investment in government securities --- (344)
Minority interest in net (income) (16,434) (1,024)
Gain on sale of property --- (116,749)
Increase (decrease) from changes in:
Other assets 35,450 79,280
Accounts payable (25,356) (2,536)
Security deposits 4,878 23,471
Net cash provided by operating activities 214,562 384,106
Cash flows used in investing activities:
Furniture & Fixture additions --- (11,746)
Construction in progress --- (1,114,226)
Proceeds from sale of property --- 1,517,819
Net cash provided by investing activities --- 391,847
Cash flows used in financing activities:
Repayment on construction loan (7,158) ---
Construction loan proceeds --- 1,033,363
Distribution to general partner (19,531) (15,221)
Distribution to limited partners (175,777) (1,657,040)
Net cash (used in) financing activities (202,466) (638,898)
Net increase in cash and cash equivalents 12,096 137,055
Cash & cash equivalents at beginning of period 103,300 36,227
CASH AND CASH EQUIVALENTS AT END OF PERIOD $115,396 $173,282
[FN]
See accompanying notes to financial statements.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
SUMMARY OF ACCOUNTING POLICIES
BUSINESS
Associated Planners Realty Fund (the "Partnership"), a California limited
partnership, was formed on November 19, 1985 under the Revised Limited
Partnership Act of the State of California. The Partnership was formed to
acquire income-producing real property throughout the United States with
emphasis on properties located in California. The Partnership purchased such
properties on an all cash basis and intended to own and operate such
properties for investment over an anticipated holding period of
approximately five to ten years.
BASIS OF PRESENTATION
The consolidated financial statements do not give effect to any assets that
the partners may have outside of their interest in the partnership, nor to
any personal obligations, including income taxes, of the partners.
The consolidated financial statements include the accounts of
Associated Planners Realty Fund and all joint ventures in which it has a
majority interest.
RENTAL REAL ESTATE AND DEPRECIATION
Assets are stated at cost. Depreciation is computed using the straight-line
method over estimated useful lives ranging from five to 35 years.
In the event that facts and circumstances indicate that the cost of an asset
may be impaired, an evaluation of recoverability would be performed. If an
evaluation is required, the estimated future undiscounted cash flows
associated with the asset would be compared to the carrying amount to
determine if a write-down to market value is required.
RENTAL INCOME
Rental revenue is recognized on a straight-line basis to the extent that
rental revenue is deemed collectible.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
SUMMARY OF ACCOUNTING POLICIES
STATEMENTS OF CASH FLOWS
For the purpose of the statements of cash flows, the Partnership considers
cash in the bank and all highly liquid investments purchased with original
maturities of three months or less, to be cash and cash equivalents.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
RECLASSIFICATIONS
For comparative purposes, certain prior year amounts have been reclassified
to conform to the current year presentation.
NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 121 "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed of"
(SFAS No. 121) issued by the Financial Accounting Standards Board is effective
for financial statements for fiscal years beginning after December 15, 1995.
The new standard establishes new guidelines regarding when impairment losses
on long-lived assets, which include plant and equipment, and certain
identifiable intangible assets, should be recognized and how impairment
losses should be measured. The Partnership elected adoption of SFAS
No. 121 on January 1, 1996. This adoption had no effect on the statement of
income for the nine months ended September 30, 1996 as there were no
impairment amounts recorded during the period.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1995
NOTE 1- NATURE OF PARTNERSHIP
The Partnership began accepting subscriptions in March 1986 and completed
its funding in December 1987.
Under the terms of the partnership agreement, the General Partner, West
Coast Realty Advisors, is entitled to cash distributions ranging from 10%
to 15%. The General Partner is also entitled to net income or loss
allocations varying from 1% to 15% and 1% depreciation and amortization
allocations in accordance with the partnership agreement.
NOTE 2- RENTAL REAL ESTATE
The Partnership currently has interests in the following four rental real
estate properties. Two are wholly-owned and two are jointly owned by the
Partnership (81.2%) and an affiliate (18.8%):
Location (Property Name) Date Purchased Original Acquisition
Cost
Encinitas, California
(179 Calle Magdalena) December 31, 1986 $ 555,743
Encinitas, California
(187 Calle Magdalena) December 31, 1986 639,697
Clovis, California January 23, 1987 1,208,990
Simi Valley, California November 12, 1987 2,620,217
The major categories of property are:
September 30, 1996 December 31, 1995
Land $2,361,894 $2,361,894
Building and Improvements 4,404,947 4,404,947
Furniture and Fixtures 46,660 46,660
6,813,501 6,813,501
Less accumulated depreciation 1,065,346 969,820
Net rental real estate $5,748,155 $5,843,681
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1995
NOTE 2- RENTAL REAL ESTATE (CONTINUED)
A significant portion of the Partnership's rental revenue was earned
from a tenant whose individual rent represented more than 10% of total
rental revenue. Specifically:
One tenant accounted for 38% in 1996;
One tenant accounted for 38% in 1995;
NOTE 3 - RELATED PARTY TRANSACTIONS
(a) For Partnership management services rendered to the Partnership,
the General Partner is entitled to receive 10% of all distributions of
cash from operations. These amounts totaled $6,791 for the quarter
ended September 30, 1996 and $6,791 for the quarter ended September 30,
1995, and $19,531 for the nine months ended September 30, 1996 and
$24,455 for the nine months ended September 30, 1995. The amounts paid
to the general partner in 1995 were treated as an expense of the
Partnership, while the amounts paid in 1996 were treated as distributions
to the general partner (See Note 7).
(b) For administrative services provided to the Partnership, the General
Partner is entitled to reimbursement for the cost of certain personnel and
relevant expenses. These amounts totaled $3,000 for the three months ended
September 30, 1996 and September 30, 1995, and $9,000 for the nine months
ended September 30, 1996 and 1995.
(c) Property management fees incurred, in accordance with the Partnership
Agreement, to West Coast Realty Management, Inc., an affiliate of the
corporate General Partner, totaled $9,226 for the quarter ended
September 30, 1996, and $5,544 for the quarter ended September 30, 1995, and
$26,536 for the nine months ended September 30, 1996 and $22,337 for the
nine months ended September 30, 1995.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1995
(continued)
NOTE 4- CONSTRUCTION IN PROGRESS AND CONSTRUCTION LOAN PAYABLE
In January 1995, the Partnership closed escrow on a parcel of land adjacent
to the Shaw Villa Shopping Center. The purchase price of the land was
$206,749, including a $13,102 acquisition fee paid to the Advisor. The
purchase was financed using $23,602 in cash, and the remainder by a one year
construction loan from Valliwide Bank of Fresno. The loan bears interest at
2% over the bank's prime rate (8.25% at September 30, 1996). The total
construction loan commitment is for $1,365,000 which matures on
October 5, 1996. Borrowings on the construction loan totaled $1,225,950 as
of December 31, 1995 and $1,218,792 as of September 30, 1996. The
construction loan amortization is interest only with payments of $78,139 paid
during the nine months ended September 30, 1996. The construction was
completed during 1995 and total construction costs of $1,372,900 was
allocated to land, building and improvements. Included in construction
costs is $87,838 in construction loan interest that was capitalized.
The carrying amount of the loan is a reasonable estimate of fair value of
the construction loan payable because the interest rates approximate the
borrowing rates currently available for mortgage loans with similar terms
and average maturities.
NOTE 5- COMMITMENTS
In October 1996, the Partnership obtained permanent financing from a major
insurance company to replace the construction loan with a twenty year loan.
The terms of the loan are as follows: Principal - $1,500,000; Interest
Rate of 9.1% fixed for five years then may be adjusted to the weekly
average of the five-year Treasury Note yield for the seventh week prior to
the Adjustment Date (5th anniversary date) plus 250 basis points, but in no
event less than the existing rate, nor to exceed the maximum rate allowed
by law; Amortized over 20 years; due November 1, 2006; and current monthly
payments of principal and interest of $13,593.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1995
NOTE 6- NET INCOME AND CASH DISTRIBUTIONS PER LIMITED PARTNERSHIP LIST
The Net Income per Limited Partnership Unit was computed in accordance with
the partnership agreement using the weighted average number of outstanding
limited partnership units of 7,499 for 1996 and 1995.
The Limited Partner cash distributions, computed in accordance with
the Partnership Agreement, were as follows:
Record Outstanding Amount Total
Date Units Per Unit Distribution
6/30/1996 7,499 $8.15 61,117
3/31/1996 7,499 8.15 61,117
12/31/1995 7,499 7.14 53,543
Total $175,777
6/30/1995 7,499 $182.60 to 207.69 $1,506,960
3/31/1995 7,499 10.00 75,040
12/31/1994 7,499 10.00 75,040
Total $1,657,040
Distributions were paid in the fiscal quarter following the record date.
NOTE 7 - REALLOCATION OF PARTNER BALANCES
Per the provisions of Section 11.1 (V)(ii) of the Partnership Agreement,
the General Partner determined that action was necessary to "cure the
ambiguities" caused by the Agreement itself. The ambiguity involved the
treatment of the partnership management fee, being paid to the General
Partner, as an expense of the Partnership, when in fact, it should have been
treated as a general partner withdrawal of capital. In order to properly
reflect this inception to date correction, a transfer of $305,548 was made
from the General Partner's capital account to the Limited Partners capital
account during the quarter ended March 31, 1996.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995 (UNAUDITED)
AND YEAR ENDED DECEMBER 31, 1995
NOTE 8 - NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 121 "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
of" (SFAS No. 121) issued by the Financial Accounting Standards Board is
effective for financial statements for fiscal years beginning after December
15, 1995. The new standard establishes new guidelines regarding when
impairment losses on long-lived assets, which include plant and equipment,
and certain identifiable intangible assets, should be recognized and how
impairment losses should be measured. The Partnership elected adoption of
SFAS No. 121 on January 1, 1996. This adoption had no effect on the
statement of income for the nine months ended September 30, 1996 as there
were no impairment amounts recorded during the period.
NOTE 9 - SUBSEQUENT EVENTS
The Partnership distributed $61,117 ($8.15 per unit) on November 5, 1996
to Limited Partners of record as of September 30, 1996.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
INTRODUCTION
Associated Planners Realty Fund (the "Partnership") was organized in November
1985, under the California Revised Limited Partnership Act. The Partnership
began offering units for sale on March 28, 1986. As of December 27, 1987,
the Partnership had raised $7,499,000 in gross capital contributions.
The Partnership netted approximately $6,720,000 after sales commissions
and syndication costs.
The Partnership was organized for the purpose of investing in, holding,
and managing improved, leveraged income-producing property, such as
residential property, office buildings, commercial buildings, industrial
properties, and shopping centers. The Partnership intends to own and
operate such properties for investment over an anticipated holding period
of approximately five to ten years.
The Partnership's principal investment objectives are to invest in rental
real estate properties which will:
(1) Preserve and protect the Partnership's invested capital;
(2) Provide for cash distributions from operations;
(3) Provide gains through potential appreciation; and
(4) Generate Federal income tax deductions so that during the early
years of property operations, a portion of cash distributions may
be treated as a return of capital for tax purposes and, therefore,
may not represent taxable income to the limited partners.
The ownership and operation of any income-producing real estate is subject
to those risks inherent in all real estate investments, including
national and local economic conditions, the supply and demand for
similar types of properties, competitive marketing conditions, zoning
changes, possible casualty losses, increases in real estate taxes,
assessments, and operating expenses, as well as others.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
The Partnership is operated by the General Partner subject to the terms of
the Amended and Restated Agreement of Limited Partnership. The Partnership
has no employees, and all administrative services are provided by West
Coast Realty Advisors, Inc., the General Partner.
RESULTS OF OPERATIONS
Operations for the quarter ended September 30, 1996, reflect an entire period
of operations for the Partnership's properties. Rental revenue for the
three and nine months ended September 30, 1996 increased from that for the
three and nine months ended September 30, 1995 by $52,813 and $63,139,
respectively, due to increased occupancy of the single tenant Santa Fe
Business Park Building, offset by the sale of the Shurgard Mini-Warehouse
facility on May 15, 1995. Costs and expenses related to the properties
operation increased for the three and nine months ended September 30, 1996
compared to the three and nine months ended September 30, 1995 by
$54,212 and $45,234, respectively, primarily due to interest expense of
$36,962 for the three months ended September 30, 1996 and $78,139 for the
nine months ended September 30, 1996. This interest pertained to the
construction loan related to the Clovis, California property. These
interest charges were incurred after the completion of construction.
In addition to the increase in interest expense, property management fees
increased due to increased occupancy at the Santa Fe Business Park Building
and operating costs increased due to higher property insurance costs,
consulting fees, general repairs and maintenance costs and an adjustment to
the 1995 minority interest account balance. This increases were offset by
lower property taxes, accounting and legal costs and partnership operating
costs.
The Partnership generated $216,024 in income from operations before
depreciation of $95,526 for the nine months ended September 30, 1996
compared to $346,110 in income from operations before depreciation of $94,594
for the nine months ended September 30, 1995. This decrease in income from
operations is primarily attributable to the gain of $116,749 recognized
during the nine months ended September 30, 1995 relating to the sale of
the Puyallup, Washington mini-warehouse building to Shurgard Storage
Centers, Inc. on May 15, 1995.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
LIQUIDITY AND CAPITAL RESOURCES
During the nine months ended September 30, 1996, $214,562 in cash was
provided by operating activities. This resulted primarily from net cash
basis income of $216,024 from operations (net income plus depreciation
expense) plus a $35,450 decrease in other assets (primarily attributable
to a decrease in prepaid insurance and miscellaneous receivable balances).
These additions to operating activities were offset by a $25,356 decrease in
trade accounts payable, and a $16,434 adjustment to the minority interest
account balance for the Encinitas properties. In contrast, during the nine
months ended September 30, 1995, $384,106 was provided by operating
activities. This resulted primarily from cash basis income of $229,361
(net income plus depreciation expense less gain on sale of property), plus
$55,898 in proceeds received from the liquidation of the government
securities account, plus $79,280 decrease in other assets (primarily due to
the reclassification of deposits used in construction in progress of the
Shaw Villa property and a $23,471 increase in security deposits and
prepaid rents (due to prepaid rents received prior to September 1995
which were not received prior to December 31, 1994), less a $2,536 decrease
in accounts payable (attributable to normal decrease in trade payable).
There were no investing activities for the nine months ended September 30,
1996. In contrast, $391,847 in cash was provided by investing activities
for the nine months ended September 30, 1995. This resulted from $1,517,819
in gross proceeds received in connection with the sale of the Puyallup,
Washington mini-warehouse, offset by $1,114,226 in construction in progress
costs associated with the Shaw Villa property and $11,746 in restaurant
equipment purchased for a Shaw Villa property tenant. Cash used in
financing activities for the nine months ended September 30, 1996 totaled
$202,466, of which $175,777 were distributions paid to the limited partners
and $19,531 paid to the general partners and $7,158 in repayments on
the construction loan payable. In contrast, $638,898 was used by financing
activities for the nine months ended September 30, 1995. This resulted from
$1,657,040 in distributions paid to the limited partners and $15,221 paid to
the general partners offset by $1,033,363 in proceeds received from a lender
in connection with the construction in progress of the Shaw Villa property.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
LIQUIDITY AND CAPITAL RESOURCES (CONT.)
In January 1995, the Partnership closed escrow on a parcel of land adjacent
to the Shaw Villa Shopping Center. The purchase price of the land was
$206,749, including a $13,102 acquisition fee paid to the Advisor.
The purchase was financed using $23,602 in cash, and the remainder by
a one year construction loan from Valliwide Bank of Fresno, that was
subsequently extended to October 5, 1996. The loan bears interest at 2%
over the bank's prime rate (8.25% at September 30, 1996). The total
construction loan commitment is for $1,365,000 which matures on
October 5, 1996. Borrowings on the construction loan totaled $1,225,950.
The construction loan amortization is interest only with payments of
$78,139 paid during the nine months ended September 30, 1996. The
construction was completed during 1995 and total construction costs
of $1,372,900 was allocated to land, building and improvements.
Included in construction costs is $87,838 in construction loan
interest that was capitalized.
In October 1996, the Partnership obtained permanent financing from a
major insurance company to replace the construction loan with a twenty year
loan. The terms of the loan are as follows: Principal - $1,500,000;
Interest Rate of 9.1% fixed for five years then may be adjusted to the weekly
average of the five-year Treasury Note yield for the seventh week prior to
the Adjustment Date (5th anniversary date) plus 250 basis points, but in no
event less than the existing rate, nor to exceed the maximum rate allowed
by law; Amortized over 20 years; due November 1, 2006; and current monthly
payments of principal and interest of $13,593.
The carrying amount is a reasonable estimate of fair value of the
construction loan payable because the interest rates approximate the
borrowing rates currently available for mortgage loans with similar
terms and average maturities.
Net income per limited partner unit decreased from $29.05 for the nine
months ended September 30, 1995 to $13.32 for the nine months ended September
30, 1996, primarily due to the $116,749 gain on sale of the Shurgard
Mini-warehouse facility on May 15, 1995.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
NEW ACCOUNTING PRONOUNCEMENTS
Statement of Financial Accounting Standards No. 121 "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed of" (SFAS No. 121) issued by the Financial Accounting Standards
Board is effective for financial statements for fiscal years beginning
after December 15, 1995. The new standard establishes new guidelines
regarding when impairment losses on long-lived assets, which include plant
and equipment, and certain identifiable intangible assets, should be
recognized and how impairment losses should be measured. The Partnership
elected adoption of SFAS No. 121 on January 1, 1996. This adoption had no
effect on the statement of income for the nine months ended September 30,
1996 as there were no impairment amounts recorded during the period.
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
PART II
O T H E R I N F O R M A T I O N
ITEM 1.LEGAL PROCEEDINGS
None
ITEM 2.CHANGES IN SECURITIES
None
ITEM 3.DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5.OTHER INFORMATION
None
ITEM 6.EXHIBIT AND REPORTS ON FORM 8-K
(a) Information required under this section has been included in
the financial statements.
(b) Reports on Form 8-K
None
ASSOCIATED PLANNERS REALTY FUND
(A CALIFORNIA LIMITED PARTNERSHIP)
S I G N A T U R E S
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.
ASSOCIATED PLANNERS REALTY FUND
A California Limited Partnership
(Registrant)
November 13, 1996 By: WEST COAST REALTY ADVISORS, INC.
A California Corporation,
General Partner
Neal E. Nakagiri
Vice President/Secretary
November 13, 1996
Michael G. Clark
Vice President/Treasurer