SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of The Securities Exchange Act of 1934
For the Quarter Ended: September 30, 1997
Commission file number: 0-17467
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
(Exact Name of Small Business Issuer as Specified in its Charter)
State of Minnesota 41-1603719
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
(Address of Principal Executive Offices)
(612) 227-7333
(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 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
Transitional Small Business Disclosure Format:
Yes No [X]
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
INDEX
PART I. Financial Information
Item 1. Balance Sheet as of September 30, 1997 and December 31, 1996
Statements for the Periods ended September 30, 1997 and 1996:
Income
Cash Flows
Changes in Partners' Capital
Notes to Financial Statements
Item 2. Management's Discussion and Analysis
PART II. Other Information
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
BALANCE SHEET
SEPTEMBER 30, 1997 AND DECEMBER 31, 1996
(Unaudited)
ASSETS
1997 1996
CURRENT ASSETS:
Cash and Cash Equivalents $ 4,848,130 $ 4,798,584
INVESTMENTS IN REAL ESTATE:
Land 3,469,538 3,469,538
Buildings and Equipment 8,026,412 8,026,412
Accumulated Depreciation (2,692,525) (2,441,191)
----------- -----------
8,803,425 9,054,759
Real Estate Held for Sale 261,644 577,072
----------- -----------
Net Investments in Real Estate 9,065,069 9,631,831
----------- -----------
Total Assets $13,913,199 $14,430,415
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Payable to AEI Fund Management, Inc. $ 22,827 $ 96,543
Distributions Payable 305,644 433,349
Security Deposit 49,953 37,307
Unearned Rent 62,787 0
----------- -----------
Total Current Liabilities 441,211 567,199
----------- -----------
PARTNERS' CAPITAL (DEFICIT):
General Partners (66,692) (62,780)
Limited Partners, $1,000 Unit value;
30,000 Units authorized; 23,389 Units issued;
22,920 Units outstanding 13,538,680 13,925,996
----------- -----------
Total Partners' Capital 13,471,988 13,863,216
----------- -----------
Total Liabilities and Partners' Capital $13,913,199 $14,430,415
=========== ===========
The accompanying notes to financial statements are an integral
part of this statement.
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
STATEMENT OF INCOME
FOR THE PERIODS ENDED SEPTEMBER 30
(Unaudited)
Three Months Ended Nine Months Ended
9/30/97 9/30/96 9/30/97 9/30/96
INCOME:
Rent $ 335,386 $ 348,769 $ 953,877 $ 1,108,861
Investment Income 64,903 82,269 190,367 245,577
--------- --------- ----------- -----------
Total Income 400,289 431,038 1,144,244 1,354,438
--------- --------- ----------- -----------
EXPENSES:
Partnership Administration -
Affiliates 65,647 75,136 201,015 221,490
Partnership Administration
and Property Management -
Unrelated Parties 19,476 38,160 74,552 139,416
Depreciation 83,778 103,378 251,533 311,103
--------- --------- ----------- -----------
Total Expenses 168,901 216,674 527,100 672,009
--------- --------- ----------- -----------
OPERATING INCOME 231,388 214,364 617,144 682,429
GAIN ON SALE OF REAL ESTATE 0 347,224 0 425,514
--------- --------- ----------- -----------
NET INCOME $ 231,388 $ 561,588 $ 617,144 $ 1,107,943
========= ========= =========== ===========
NET INCOME ALLOCATED:
General Partners $ 2,314 $ 5,615 $ 6,172 $ 11,079
Limited Partners 229,074 555,973 610,972 1,096,864
--------- --------- ----------- -----------
$ 231,388 $ 561,588 $ 617,144 $ 1,107,943
========= ========= =========== ===========
NET INCOME PER
LIMITED PARTNERSHIP UNIT
(22,920 and 23,107 weighted average
Units outstanding in 1997
and 1996 respectively) $ 10.00 $ 24.06 $ 26.66 $ 47.47
========= ========= =========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
FOR THE PERIODS ENDED SEPTEMBER 30
(Unaudited)
1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 617,144 $ 1,107,943
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation 251,533 311,103
Gain on Sale of Real Estate 0 (425,514)
Decrease in Receivables 0 44,521
Decrease in Payable to
AEI Fund Management, Inc. (73,716) (8,281)
Increase in Security Deposit 12,646 0
Increase in Unearned Rent 62,787 69,111
----------- -----------
Total Adjustments 253,250 (9,060)
----------- -----------
Net Cash Provided By
Operating Activities 870,394 1,098,883
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from Sale of Real Estate 315,229 2,097,736
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease in Distributions Payable (127,705) (282,237)
Distributions to Partners (1,008,372) (1,421,042)
----------- -----------
Net Cash Used For
Financing Activities (1,136,077) (1,703,279)
----------- -----------
NET INCREASE IN CASH AND CASH EQUIVALENTS 49,546 1,493,340
CASH AND CASH EQUIVALENTS, beginning of period 4,798,584 6,467,946
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 4,848,130 $ 7,961,286
=========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
FOR THE PERIODS ENDED SEPTEMBER 30
(Unaudited)
Limited
Partnership
General Limited Units
Partners Partners Total Outstanding
BALANCE, December 31, 1995 $ (21,896) $17,973,501 $17,951,605 23,106.79
Distributions (14,210) (1,406,832) (1,421,042)
Net Income 11,079 1,096,864 1,107,943
--------- ----------- ----------- ----------
BALANCE, September 30, 1996 $ (25,027) $17,663,533 $17,638,506 23,106.79
========= =========== =========== ==========
BALANCE, December 31, 1996 $ (62,780) $13,925,996 $13,863,216 22,920.29
Distributions (10,084) (998,288) (1,008,372)
Net Income 6,172 610,972 617,144
--------- ----------- ----------- ----------
BALANCE, September 30, 1997 $ (66,692) $13,538,680 $13,471,988 22,920,29
========= =========== =========== ==========
The accompanying Notes to Financial Statements are an integral
part of this statement.
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
(Unaudited)
(1) The condensed statements included herein have been prepared
by the Partnership, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission, and
reflect all adjustments which are, in the opinion of
management, necessary to a fair statement of the results of
operations for the interim period, on a basis consistent with
the annual audited statements. The adjustments made to these
condensed statements consist only of normal recurring
adjustments. Certain information, accounting policies, and
footnote disclosures normally included in financial
statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant
to such rules and regulations, although the Partnership
believes that the disclosures are adequate to make the
information presented not misleading. It is suggested that
these condensed financial statements be read in conjunction
with the financial statements and the summary of significant
accounting policies and notes thereto included in the
Partnership's latest annual report on Form 10-KSB.
(2) Organization -
AEI Real Estate Fund XVII Limited Partnership (Partnership)
was formed to acquire and lease commercial properties to
operating tenants. The Partnership's operations are managed
by AEI Fund Management XVII, Inc. (AFM), the Managing
General Partner of the Partnership. Robert P. Johnson, the
President and sole shareholder of AFM, serves as the
Individual General Partner of the Partnership. An affiliate
of AFM, AEI Fund Management, Inc., performs the
administrative and operating functions for the Partnership.
The terms of the Partnership offering call for a
subscription price of $1,000 per Limited Partnership Unit,
payable on acceptance of the offer. The Partnership
commenced operations on February 10, 1988 when minimum
subscriptions of 2,000 Limited Partnership Units
($2,000,000) were accepted. The Partnership's offering
terminated on November 1, 1988 when the one-year offering
period expired. The Partnership received subscriptions for
23,388.7 Limited Partnership Units ($23,388,700).
Under the terms of the Limited Partnership Agreement, the
Limited Partners and General Partners contributed funds of
$23,388,700 and $1,000, respectively. During the operation
of the Partnership, any Net Cash Flow, as defined, which the
General Partners determine to distribute will be distributed
90% to the Limited Partners and 10% to the General Partners;
provided, however, that such distributions to the General
Partners will be subordinated to the Limited Partners first
receiving an annual, noncumulative distribution of Net Cash
Flow equal to 10% of their Adjusted Capital Contribution, as
defined, and, provided further, that in no event will the
General Partners receive less than 1% of such Net Cash Flow
per annum. Distributions to Limited Partners will be made
pro rata by Units.
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(2) Organization - (Continued)
Any Net Proceeds of Sale, as defined, from the sale or
financing of the Partnership's properties which the General
Partners determine to distribute will, after provisions for
debts and reserves, be paid in the following manner: (i)
first, 99% to the Limited Partners and 1% to the General
Partners until the Limited Partners receive an amount equal
to: (a) their Adjusted Capital Contribution plus (b) an
amount equal to 6% of their Adjusted Capital Contribution
per annum, cumulative but not compounded, to the extent not
previously distributed from Net Cash Flow; (ii) next, 99% to
the Limited Partners and 1% to the General Partners until
the Limited Partners receive an amount equal to 14% of their
Adjusted Capital Contribution per annum, cumulative but not
compounded, to the extent not previously distributed; (iii)
next, to the General Partners until cumulative distributions
to the General Partners under Items (ii) and (iii) equal 15%
of cumulative distributions to all Partners under Items (ii)
and (iii). Any remaining balance will be distributed 85% to
the Limited Partners and 15% to the General Partners.
Distributions to the Limited Partners will be made pro rata
by Units.
For tax purposes, profits from operations, other than
profits attributable to the sale, exchange, financing,
refinancing or other disposition of the Partnership's
property, will be allocated first in the same ratio in
which, and to the extent, Net Cash Flow is distributed to
the Partners for such year. Any additional profits will be
allocated 90% to the Limited Partners and 10% to the General
Partners. In the event no Net Cash Flow is distributed to
the Limited Partners, 90% of each item of Partnership
income, gain or credit for each respective year shall be
allocated to the Limited Partners, and 10% of each such item
shall be allocated to the General Partners. Net losses from
operations will be allocated 98% to the Limited Partners and
2% to the General Partners.
For tax purposes, profits arising from the sale, financing,
or other disposition of the Partnership's property will be
allocated in accordance with the Partnership Agreement as
follows: (i) first, to those Partners with deficit balances
in their capital accounts in an amount equal to the sum of
such deficit balances; (ii) second, 99% to the Limited
Partners and 1% to the General Partners until the aggregate
balance in the Limited Partners' capital accounts equals the
sum of the Limited Partners' Adjusted Capital Contributions
plus an amount equal to 14% of their Adjusted Capital
Contributions per annum, cumulative but not compounded, to
the extent not previously allocated; (iii) third, to the
General Partners until cumulative allocations to the General
Partners equal 15% of cumulative allocations. Any remaining
balance will be allocated 85% to the Limited Partners and
15% to the General Partners. Losses will be allocated 98%
to the Limited Partners and 2% to the General Partners.
The General Partners are not required to currently fund a
deficit capital balance. Upon liquidation of the Partnership
or withdrawal by a General Partner, the General Partners
will contribute to the Partnership an amount equal to the
lesser of the deficit balances in their capital accounts or
1% of total Limited Partners' and General Partners' capital
contributions.
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate -
In January, 1996, the Cheddar's restaurant in Indianapolis,
Indiana was destroyed by a fire. The Partnership reached an
agreement with the tenant and insurance company which called
for termination of the Lease, demolition of the building and
payment to the Partnership of $407,282 for the building and
equipment and $49,688 for lost rent. The property will not
be rebuilt and the Partnership listed the land for sale.
The Partnership recognized net disposition proceeds of
$406,892 which resulted in a net gain of $78,290. At the
time of disposition, the cost and related accumulated
depreciation was $512,433 and $183,831, respectively. The
Partnership's cost of the land is $261,644.
In June, 1996, the Partnership entered into an agreement to
sell the Danny's Family Car Wash in Phoenix, Arizona to the
lessee. On September 25, 1996, the sale closed with the
Partnership receiving net sale proceeds of $1,690,844 which
resulted in a net gain of $347,224. At the time of sale,
the cost and related accumulated depreciation was $1,688,271
and $344,651, respectively.
In July, 1996, the Partnership entered into an agreement to
sell the J.T. McCord's in Mesquite, Texas to an unrelated
third party. In September, 1996, the Agreement was
terminated by the purchaser. The property was listed for
sale or lease until March, 1997 when it was re-leased to
Texas Sports City Cafe, Ltd. under a triple net lease
agreement with a primary term of 12 years which may be
renewed for up to two consecutive five-year periods. The
Partnership's share of the annual base rent is $32,500 for
the first lease year and $58,500 for the second lease year,
with rent increases in each subsequent lease year of either
three percent of the prior year's rent or three percent of
gross receipts in years two and three and six percent of
gross receipts thereafter, to the extent they exceed the
base rent.
The Partnership owned a 65.09% interest in the Sizzler
restaurant at the King's Island Theme Park near Cincinnati,
Ohio. In January, 1994, the Partnership closed the
restaurant and listed it for sale or lease. On January 23,
1997, the Partnership sold its interest in the property to
an unrelated third party. The Partnership received net
sales proceeds of $315,229, which resulted in a net loss of
$503,600, which was recognized as a real estate impairment
in the fourth quarter of 1996. Prior to the sale, the
Partnership was responsible for the real estate taxes and
other costs required to maintain the property. No rent was
received in 1997 or 1996 from the property. At December 31,
1996, the property was classified on the balance sheet as
Real Estate Held for Sale.
During the first nine months of 1997 and the year 1996, the
Partnership distributed $139,694 and $3,607,123 of the net
sale proceeds to the Limited and General Partners which
represented a return of capital of $6.04 and $155.66 per
Limited Partnership Unit, respectively. In June, 1997, the
Managing General Partner filed a proxy statement to propose
an Amendment to the Limited Partnership Agreement that would
allow the Partnership to reinvest the majority of the sales
proceeds in additional properties. The Amendment passed
with a majority of Units voting in favor of the Amendment.
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
In October, 1997, the Partnership entered into a Development
Financing Commitment under which the Partnership will
advance funds for the construction of a Timber Lodge
Steakhouse restaurant in Rockford, Illinois. The purchase
price will be approximately $1,620,000. The property will
be leased to Timber Lodge Steakhouse, Inc. under a Lease
Agreement with a primary term of 20 years and annual rental
payments of approximately $174,000.
In October, 1997, the Partnership entered into an agreement
to purchase a 60% interest in a TGI Friday's restaurant in
Greensburg, Pennsylvania. The purchase price for the entire
property will be approximately $1,650,000. The property
will be leased to Ohio Valley Bistros, Inc. under a Lease
Agreement with a primary term of 15 years and annual rental
payments of approximately $169,000. AEI Income & Growth
Fund XXII Limited Partnership, an affiliate of the
Partnership, is expected to acquire the remaining interest.
(4) Payable to AEI Fund Management -
AEI Fund Management, Inc. performs the administrative and
operating functions for the Partnership. The payable to AEI
Fund Management represents the balance due for those
services. This balance is non-interest bearing and
unsecured and is to be paid in the normal course of
business.
(5) Security Deposit -
In May, 1997, the Partnership received a deposit from the
tenant of the Texas Sport City Cafe as security for
construction improvements being made by the tenant. The
funds are invested in a short term money market account and
will be returned to the lessee, without interest, within ten
days after written notification of satisfactory completion
of the work. In October, 1997, the Partnership returned the
deposit to the lessee.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS
Results of Operations
For the nine months ended September 30, 1997 and 1996, the
Partnership recognized rental income of $953,877 and $1,108,861,
respectively. During the same periods, the Partnership earned
investment income of $190,367 and $245,577, respectively. In
1997, rental income decreased as a result of the property sales
discussed below. The decrease in rental income was partially
offset by rent increases on ten properties and rent received from
re-leasing the Mesquite property. In 1997, investment income
decreased mainly as a result of a decrease in short-term
investments in 1997 due to a special distribution of net sale
proceeds to the Partners in November, 1996.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
In July, 1996, the Partnership entered into an agreement to
sell the J.T. McCord's in Mesquite, Texas to an unrelated third
party. In September, 1996, the Agreement was terminated by the
purchaser. The property was listed for sale or lease until
March, 1997 when it was re-leased to Texas Sports City Cafe, Ltd.
under a triple net lease agreement with a primary term of 12
years which may be renewed for up to two consecutive five-year
periods. The Partnership's share of the annual base rent is
$32,500 for the first lease year and $58,500 for the second lease
year, with rent increases in each subsequent lease year of either
three percent of the prior year's rent or three percent of gross
receipts in years two and three and six percent of gross receipts
thereafter, to the extent they exceed the base rent.
The Partnership owned a 65.09% interest in the Sizzler
restaurant at the King's Island Theme Park near Cincinnati, Ohio.
In January, 1994, the Partnership closed the restaurant and
listed it for sale or lease. On January 23, 1997, the
Partnership sold its interest in the property to an unrelated
third party. The Partnership received net sales proceeds of
$315,229, which resulted in a net loss of $503,600, which was
recognized as a real estate impairment in the fourth quarter of
1996. Prior to the sale, the Partnership was responsible for the
real estate taxes and other costs required to maintain the
property. No rent was received in 1997 or 1996 from the
property. At December 31, 1996, the property was classified on
the balance sheet as Real Estate Held for Sale.
During the nine months ended September 30, 1997 and 1996,
the Partnership paid Partnership administration expenses to
affiliated parties of $201,015 and $221,490, respectively. These
administration expenses include costs associated with the
management of the properties, processing distributions, reporting
requirements and correspondence to the Limited Partners. During
the same periods, the Partnership incurred Partnership
administration and property management expenses from unrelated
parties of $74,552 and $139,416, respectively. These expenses
represent direct payments to third parties for legal and filing
fees, direct administrative costs, outside audit and accounting
costs, taxes, insurance and other property costs. The decrease
in these expenses in 1997, when compared to 1996, is the result
of expenses incurred in 1996 related to the J.T. McCordOs and
Sizzler situations discussed above.
As of September 30, 1997, the Partnership's annualized
cash distribution rate was 7.5%, based on the Adjusted Capital
Contribution. Distributions of Net Cash Flow to the General
Partners were subordinated to the Limited Partners as required in
the Partnership Agreement. As a result, 99% of distributions and
income were allocated to Limited Partners and 1% to the General
Partners.
Inflation has had a minimal effect on income from
operations. It is expected that increases in sales volumes of
the tenants, due to inflation and real sales growth, will result
in an increase in rental income over the term of the leases.
Inflation also may cause the Partnership's real estate to
appreciate in value. However, inflation and changing prices may
also have an adverse impact on the operating margins of the
properties' tenants which could impair their ability to pay rent
and subsequently reduce the Partnership's Net Cash Flow available
for distributions.
Liquidity and Capital Resources
During the nine months ended September 30, 1997, the
Partnership's cash balances increased $49,546 as a result of net
proceeds received from the sale of the Sizzler property which
were partially offset by distributions made in excess of cash
generated from operating activities. Net cash provided by
operating activities decreased from $1,098,883 in 1996 to
$870,394 in 1997 mainly as the result of a decrease in income in
1997, when compared to 1996.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
For the nine months ended September 30, 1997 and 1996, net
cash provided by investing activities was $315,229 and
$2,097,736, respectively, which represents cash generated from
the disposition of real estate.
In January, 1996, the Cheddar's restaurant in
Indianapolis, Indiana was destroyed by a fire. The Partnership
reached an agreement with the tenant and insurance company which
called for termination of the Lease, demolition of the building
and payment to the Partnership of $407,282 for the building and
equipment and $49,688 for lost rent. The property will not be
rebuilt and the Partnership listed the land for sale. The
Partnership recognized net disposition proceeds of $406,892 which
resulted in a net gain of $78,290. At the time of disposition,
the cost and related accumulated depreciation was $512,433 and
$183,831, respectively. The Partnership's cost of the land is
$261,644.
In June, 1996, the Partnership entered into an agreement
to sell the Danny's Family Car Wash in Phoenix, Arizona to the
lessee. On September 25, 1996, the sale closed with the
Partnership receiving net sale proceeds of $1,690,844 which
resulted in a net gain of $347,224. At the time of sale, the
cost and related accumulated depreciation was $1,688,271 and
$344,651, respectively.
During the first nine months of 1997 and the year 1996,
the Partnership distributed $139,694 and $3,607,123 of the net
sale proceeds to the Limited and General Partners which
represented a return of capital of $6.04 and $155.66 per Limited
Partnership Unit, respectively. In June, 1997, the Managing
General Partner filed a proxy statement to propose an Amendment
to the Limited Partnership Agreement that would allow the
Partnership to reinvest the majority of the sales proceeds in
additional properties. The Amendment passed with a majority of
Units voting in favor of the Amendment.
In October, 1997, the Partnership entered into a
Development Financing Commitment under which the Partnership will
advance funds for the construction of a Timber Lodge Steakhouse
restaurant in Rockford, Illinois. The purchase price will be
approximately $1,620,000. The property will be leased to Timber
Lodge Steakhouse, Inc. under a Lease Agreement with a primary
term of 20 years and annual rental payments of approximately
$174,000.
In October, 1997, the Partnership entered into an
agreement to purchase a 60% interest in a TGI Friday's restaurant
in Greensburg, Pennsylvania. The purchase price for the entire
property will be approximately $1,650,000. The property will be
leased to Ohio Valley Bistros, Inc. under a Lease Agreement with
a primary term of 15 years and annual rental payments of
approximately $169,000. AEI Income & Growth Fund XXII Limited
Partnership, an affiliate of the Partnership, is expected to
acquire the remaining interest.
The Partnership's primary use of cash flow is distribution
and redemption payments to Partners. The Partnership declares
its regular quarterly distributions before the end of each
quarter and pays the distribution in the first week after the end
of each quarter. The Partnership attempts to maintain a stable
distribution rate from quarter to quarter. Redemption payments
are paid to redeeming Partners in the fourth quarter of each
year. During 1996, the Partnership distributed approximately
$354,000 of net sale proceeds in addition to the regular
quarterly distributions of net cash flow. The distributions were
made in equal quarterly installments. As a result, distributions
are higher in 1996, when compared to 1997. In November, 1996,
the Partnership distributed net sale proceeds of $2,828,283 to
the Partners as a special distribution.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
The Partnership may acquire Units from Limited Partners
who have tendered their Units to the Partnership. Such Units may
be acquired at a discount. The Partnership is not obligated to
purchase in any year more than 5% of the number of Units
outstanding at the beginning of the year. In no event shall the
Partnership be obligated to purchase Units if, in the sole
discretion of the Managing General Partner, such purchase would
impair the capital or operation of the Partnership.
On October 1, 1997, fifteen Limited Partners redeemed a
total of 364.4 Partnership Units for $153,502 in accordance with
the Partnership Agreement. The Partnership acquired these Units
using Net Cash Flow from operations. In prior years, a total of
thirty Limited Partners redeemed 468.5 Partnership Units for
$337,842. The redemptions increase the remaining Limited
Partners' ownership interest in the Partnership.
The continuing rent payments from the properties, together
with cash generated from the property sales, should be adequate
to fund continuing distributions and meet other Partnership
obligations on both a short-term and long-term basis.
PART II - OTHER INFORMATION
ITEM 1.LEGAL PROCEEDINGS
There are no material pending legal proceedings to which
the Partnership is a party or of which the Partnership's
property is subject.
ITEM 2.CHANGES IN SECURITIES
None.
ITEM 3.DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
In June, 1997, the Managing General Partner solicited by
mail a proxy statement to propose two Amendments to the
Limited Partnership Agreement. In order for a proposed
Amendment to be adopted, a majority of the Units must be voted
in favor of the Amendment.
The first Amendment would allow the Partnership to
reinvest the majority of net sale proceeds in additional
properties. Of the 22,920 outstanding Units, 12,655 voted for
the Amendment, 2,632 voted against and 632 abstained. As a
result, the Amendment was adopted.
The second Amendment made changes to the PartnershipOs
Unit repurchase provisions. Of the 22,920 outstanding Units,
13,827 voted for the Amendment, 1,369 voted against and 723
abstained. As a result, the Amendment was adopted.
ITEM 5.OTHER INFORMATION
None.
PART II - OTHER INFORMATION
(Continued)
ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits -
Description
10.1 Development Financing and Leasing
Commitment dated October 17, 1997 between
AEI Fund Management, Inc. and Timber
Lodge Steakhouse, Inc. relating to the
sale and leaseback of a Timber Lodge
Steakhouse restaurant at 7375 East State
Street, Rockford, Illinois.
10.2 Assignment of Development Financing
and Leasing Commitment dated October 21,
1997, between the Partnership and AEI
Fund Management, Inc. relating to the
sale and leaseback of a Timber Lodge
Steakhouse restaurant at 7375 East State
Street, Rockford, Illinois.
10.3 Sale and Leaseback Financing
Commitment dated May 13, 1997 between AEI
Fund Management, Inc. and Ohio Valley
Bistros, Inc. relating to the sale and
leaseback of a TGI Friday's restaurant at
#1507, Rural Route #6, Greensburg,
Pennsylvania.
10.4 Assignment of Sale and Leaseback
Financing Commitment dated November 7,
1997 between the Partnership and AEI Fund
Management, Inc. relating to the sale and
leaseback of a TGI Friday's restaurant at
#1507, Rural Route #6, Greensburg,
Pennsylvania.
27 Financial Data Schedule for period
ended September 30, 1997.
b. Reports filed on Form 8-K -
None.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
Registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
Dated: November 7, 1997 AEI Real Estate Fund XVII
Limited Partnership
By: AEI Fund Management XVII, Inc.
Its: Managing General Partner
By: /s/ Robert P Johnson
Robert P. Johnson
President
(Principal Executive Officer)
By: /s/ Mark E Larson
Mark E. Larson
Chief Financial Officer
(Principal Accounting Officer)