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 MARCH 31, 1995
OR
[ ] TRANSACTION REPORT PURSUANT TO SECTION 13 0R 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
FOR THE QUARTER ENDED MARCH 31, 1995 COMMISSION FILE NUMBER 0-18494
IDS/SHURGARD INCOME GROWTH PARTNERS, L.P. II
(Exact name of registrant as specified in its charter)
Washington 91-1436174
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1201-3rd Avenue, Suite 2200, Seattle, Washington 98101
(address of principal executive offices) (zip code)
(Registrant's telephone number, including area code) 206-624-8100
Indicate by a check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Excahnge Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to filed such reports), and (2) has been subject
to such filing requirements for the past 90 days.
Yes X No
Part I, Item 1: Management's Discussion & Analysis
FINANCIAL HIGHLIGHTS
Quarter Ended March 31,
1995 1994
----------- -----------
Average Occupancy 89% 88%
Revenues $ 1,015,806 $ 952,880
Earnings $ 295,099 $ 292,082
Distribution Rate (per $250 unit) 6.50% / $4.06 6.25% / $3.91
TO OUR PARTNERS
We are pleased to provide you with the
financial reports for IDS/Shurgard Income
Growth Partners L.P. II for the quarter ended
March 31, 1995.
Operating Results. Revenues increased 7%
in the first quarter of 1995 to $1,015,806
from $952,880 for the corresponding quarter
of 1994. The increase resulted primarily
from a 7.7% increase in the average rental
rate per square foot and continued stable
occupancies. Kenneydale and Newport News
North storage centers contributed the largest
revenue gain in your Partnership of $23,000
and $16,000, respectively. Occupancies
remained stable at an average of 89% at March
31, 1995 compared to 88% one year ago.
Total expenses rose 9% for the quarter
compared to 1994. Operating and
administrative expenses increased 17% due to
1) timing of investor relation expenses, 2)
increased payout of tenant claims, and 3)
increased postage and supply costs.
Additionally, interest rates rose from 6.5%
at March 31,1994 to 9.625% at March 31, 1995
causing a $9,700 increase in interest
expense.
Investing Activities. The Partnership
invested approximately $475,000 during the
first quarter of 1995 to expand the
Chesapeake center. This project entails the
construction of two, one-story buildings
totaling approximately 26,000 square feet of
storage space, as well as the addition of
2,400 square feet of RV parking. The first
units in the new addition opened the
beginning of April. The remaining costs of
approximately $437,000 will be primarily
funded from the Partnership's line of credit.
Additionally, other capital improvements
planned for the remaining three quarters
total approximately $48,000 including
pavement, ground, and building improvements
at the Bellefield center as well as pavement
work at the Sterling Heights center. These
improvements are important to maintaining the
value of your investment as well as its
ability to generate revenue.
Financing Activities. During the quarter,
the Partnership drew $185,000 on their
$1,500,000 line of credit in order to fund
the Chesapeake buildout. As of May 1, 1995
the Partnership converted the $1,500,000 line
of credit to an $850,000 non-revolving line
of credit, maturing May 1, 1997. The
Partnership plans to pay off this line of
credit from operating cashflow over the next
two years.
If you have any questions regarding your
investment, please contact your American
Express Financial Advisor or call Shurgard
Investor Relations at 800-955-2235.
Sincerely,
Janis E. Miller Charles K. Barbo
President General Partner
IDS Partnership Shurgard Associates L.P. II
Services Corporation
Part I, Item 1: Balance Sheets (unaudited)
BALANCE SHEETS
Mar. 31, Dec. 31,
Unaudited 1995 1994
------------- ------------
Assets:
Cash and cash equivalents $ 121,991 $ 384,867
Storage centers, net 25,395,804 25,126,512
Other assets 157,294 174,768
Amortizable assets 162,149 179,874
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Total Assets $ 25,837,238 $25,866,021
============= ===========
Liabilities and Partners' Equity (Deficit):
Liabilities
Accounts payable and other accrued expenses $ 306,046 $ 287,165
Construction payable 154,373 173,572
Line of credit 185,000
Notes payable 2,922,013 2,938,331
------------- -----------
Total Liabilities 3,567,432 3,399,068
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Partners' equity (deficit)
Limited partners 22,435,927 22,623,217
General partner (166,121) (156,264)
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Total Partners' Equity (Deficit) 22,269,806 22,466,953
------------- -----------
Total Liabilities and Partners'
Equity (Deficit) $ 25,837,238 $ 25,866,021
============= ============
Part I, Item 1: Staements of Earnings (unaudited)
STATEMENTS OF EARNINGS
Three Months Ended Mar.31,
Unaudited 1995 1994
---------- ------------
Revenues:
Rental $ 1,013,765 $ 949,203
Interest income 2,041 3,677
----------- -----------
Total Revenues 1,015,806 952,880
----------- -----------
Expenses:
Operating and administrative 275,402 236,133
Property management fees 60,791 56,948
Depreciation 209,318 208,105
Real estate taxes 92,368 86,575
Interest 65,103 55,374
Amortization 17,725 17,663
----------- -----------
Total Expenses 720,707 660,798
----------- -----------
Earnings $ 295,099 $ 292,082
=========== ===========
Earnings per unit of limited partnership interest $ 2.44 $ 2.41
=========== ===========
Distributions per unit of limited
partnership interest $ 4.06 $ 3.91
=========== ===========
Part I, Item 1: Statements of Cash Flows (unaudited)
STATEMENTS OF CASH FLOWS
Three Months Ended Mar.31,
Unaudited 1995 1994
------------- ---------
Operating activities:
Earnings $ 295,099 $ 292,082
Adjustments to reconcile earnings to
net cash provided by operating activities:
Depreciation and amortization 227,043 225,768
Changes in operating accounts:
Other assets 17,474 (10,721)
Accounts payable and other accrued expenses 18,881 (61,446)
----------- -----------
Net cash provided by operating activities 558,497 445,683
----------- -----------
Investing activities:
Construction of and improvements to
storage centers (497,809) (10,378)
----------- -----------
Financing activities:
Payment of loan costs (11,741)
Proceeds from line of credit 185,000
Payments on notes payable (16,318) (10,107)
Distributions to partners (492,246) (473,314)
----------- -----------
Net cash used in financing activities (323,564) (495,162)
----------- -----------
Decrease in cash and cash equivalents (262,876) (59,857)
Cash and cash equivalents at beginning of year 384,867 621,073
Cash and cash equivalents at end of period $ 121,991 $ 561,216
============= ===========
Supplemental disclosures of cash flow information:
Cash paid during period for interest $ 65,103 $ 55,374
============= ===========
Part I, Item 1: Notes to Financial Statements
NOTES TO FINANCIAL STATEMENTS
Note A -- Financial Statements Preparation
The interim financial statements are
unaudited but reflect all adjustments that
are, in the opinion of management, necessary
to a fair statement of the results for the
interim periods presented. These adjustments
consist primarily of normal recurring
accruals. The interim financial statements
should be read in conjunction with the
audited financial statements contained in the
1994 Annual Report. The results of
operations for interim periods will not
necessarily be indicative of the operating
results for the fiscal year.
Distributions and earnings per unit of
limited partnership interest are based on the
total amounts distributed and allocated to
limited partners divided by the number of
units outstanding during the period (115,110
for the three months ended March 31, 1995 and
1994).
Note B -- Line of Credit
During the quarter, the Partnership drew
$185,000 on their $1,500,000 line of credit
in order to fund the Chesapeake buildout. As
of May 1, 1995 the Partnership converted the
$1,500,000 line of credit to an $850,000 non-
revolving line of credit, maturing May 1,
1997. The Partnership plans to pay off this
line of credit from operating cashflow over
the next two years.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
reqistrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
IDS/SHURGARD INCOME GROWTH PARTNERS, L.P. II
Date: May 15,1995 By: HARRELL BECK
Harrell Beck
Chief Financial Officer and Authorized Signatory
Shurgard General Partner, Inc.
General Partner