SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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For Quarter Ended March 31, 2000 Commission File Number 0-17808
NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Massachusetts 04-2940131
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
225 Franklin Street, 25th Fl.
Boston, Massachusetts 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(617) 261-9000
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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 twelve (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
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
FORM 10-Q
FOR QUARTER ENDED MARCH 31, 2000
PART I
FINANCIAL INFORMATION
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
BALANCE SHEETS
March 31, 2000 December 31, 1999
(Unaudited) (Audited)
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ASSETS
Real estate investments:
Property, net $ 8,759,012 $ 8,695,906
Joint venture -- 152,500
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8,759,012 8,848,406
Property held for disposition, net -- 1,491,742
Cash and cash equivalents 6,415,646 12,026,888
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$ 15,174,658 $ 22,367,036
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LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 100,083 $ 93,275
Accrued management fee 11,706 16,963
Deferred management and
disposition fees 1,956,543 1,930,523
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Total liabilities 2,068,332 2,040,761
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Partners' capital (deficit):
Limited partners ($273 and $367 per
unit, respectively; 160,000 units
authorized, 82,228
units issued and outstanding) 13,114,319 20,339,363
General partners (7,993) (13,088)
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Total partners' capital 13,106,326 20,326,275
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$ 15,174,658 $ 22,367,036
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(See accompanying notes to unaudited financial statements)
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
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2000 1999
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INVESTMENT ACTIVITY
Property rentals $ 521,064 $ 1,010,716
Interest income on loan to
ground lessor 22,181 34,094
Property operating expenses (49,268) (268,217)
Ground rent expense (97,500) (97,500)
Depreciation and amortization (117,134) (287,620)
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279,343 391,473
Joint venture earnings -- 100,259
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Total real estate operations 279,343 491,732
Gain on sale of property 556,268 --
Interest on cash equivalents 124,854 103,652
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Total investment activity 960,465 595,384
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PORTFOLIO EXPENSES
Management fee 35,323 82,228
General and administrative 72,627 68,101
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107,950 150,329
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Net Income $ 852,515 $ 445,055
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Net income per limited
partnership unit $ 10.26 $ 5.36
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Cash distributions per
limited partnership unit $ 98.13 $ 8.86
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Number of limited partnership
units outstanding during
the period 82,228 82,228
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(See accompanying notes to unaudited financial statements)
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
(Unaudited)
Three Months Ended March 31,
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2000 1999
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General Limited General Limited
Partners Partners Partners Partners
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Balance at
beginning of
period $ (13,088) $ 20,339,363 $ (27,832) $ 39,354,545
Cash
distributions (3,430) (8,069,034) (7,359) (728,540)
Net income 8,525 843,990 4,451 440,604
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Balance at
end of period $ (7,993) $ 13,114,319 $ (30,740) $ 39,066,609
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(See accompanying notes to unaudited financial statements)
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
SUMMARIZED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended March 31,
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2000 1999
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Net cash provided by operating activities $ 341,212 $ 752,517
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Cash flows from (used in) investing activities:
Net proceeds from sale of investment 2,048,010 --
Deferred disposition fees 66,600 --
Investment in property (8,554) 28,066
Repayment received on loan to
ground lessor 13,954 19,253
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Net cash provided by investing activities 2,120,010 47,319
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Cash flows from financing activities:
Distributions to partners (8,072,464) (735,899)
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Net increase (decrease) in cash
and cash equivalents (5,611,242) 63,937
Cash and cash equivalents:
Beginning of period 12,026,888 7,220,155
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End of period $ 6,415,646 $ 7,284,092
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(See accompanying notes to unaudited financial statements)
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS (Unaudited)
In the opinion of management, the accompanying unaudited financial
statements contain all adjustments necessary to present fairly the Partnership's
financial position as of March 31, 2000 and December 31, 1999 and the results of
its operations, its cash flows and partners' capital (deficit) for the three
months ended March 31, 2000 and 1999. These adjustments are of a normal
recurring nature.
See notes to financial statements included in the Partnership's 1999 Annual
Report on Form 10-K for additional information relating to the Partnership's
financial statements.
NOTE 1 - ORGANIZATION AND BUSINESS
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New England Pension Properties V; A Real Estate Limited Partnership (the
"Partnership") is a Massachusetts limited partnership organized for the purpose
of investing primarily in newly constructed and existing income producing real
properties. It primarily serves as an investment for qualified pension and
profit sharing plans and other entities intended to be exempt from federal
income tax. The Partnership commenced operations in May, 1987 and acquired its
real estate investments prior to the end of 1989. The Partnership intends to
dispose of its investments within eight to twelve years of their acquisition,
and then liquidate. The Partnership has engaged AEW Real Estate Advisors, Inc.
(the "Advisor") to provide asset management services.
NOTE 2 - REAL ESTATE JOINT VENTURES
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On December 20, 1999, the Columbia Gateway Corporate Park joint venture
investment in which the Partnership and an affiliate are entitled to 30.5% and
69.5%, respectively, of the operating activity, sold its property to an
unaffiliated third party for gross proceeds of $19,850,000, of which the
Partnership's share was $6,054,250. The Partnership received its 30.5% share of
the net proceeds, $5,891,032 after closing costs, and recognized a gain of
$957,057 ($11.52 per limited partnership unit) on the sale. On January 27, 2000,
the Partnership made a capital distribution of $5,755,960 ($70 per limited
partnership unit) from the proceeds of the sale. In addition, a portion of the
proceeds was used to pay previously accrued but deferred management fees to the
Advisor of $23,617. At December 31, 1999, $500,000 remained in the joint
venture, of which the Partnership's 30.5% share, $152,500, was distributed to
the Partnership in February 2000.
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
The following summarized financial information is presented in the
aggregate for the Partnership's joint venture:
Results of Operations
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Three Months Ended March 31,
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2000 1999
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Revenue
Rental income $ - $ 535,680
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- 535,680
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Expenses
Operating expenses - 142,496
Depreciation and amortization - 64,475
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- 206,971
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Net income $ - $ 328,709
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Liabilities and expenses exclude amounts owed and attributable to the
Partnership and its affiliate on behalf of their financing arrangements with the
joint venture.
NOTE 3 - PROPERTY
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On June 25, 1999, the Partnership sold the Puente Street property for
$11,770,000. The Partnership received net proceeds of $11,211,554 and recognized
a gain of $104,975 ($1.26 per limited partnership unit). A disposition fee of
$353,100 was accrued but not paid to the Advisor. On July 29, 1999, the
Partnership made a capital distribution of $11,018,552 ($134 per limited
partnership unit) from the sale proceeds. In addition, a portion of the proceeds
was used to pay deferred management fees to the Advisor, of $234,897.
On August 27, 1999, the Partnership sold the Dahlia property for
$9,900,000. The Partnership received net proceeds of $9,723,207 and recognized a
gain of $3,367,359 ($40.54 per limited partnership unit). A disposition fee of
$297,000 was accrued but not paid to the Advisor. On September 22, 1999, the
Partnership made a capital distribution of $9,456,220 ($115 per limited
partnership unit) from the sale proceeds.
On February 17, 2000, the Partnership sold the Waters Landing II property
for $2,220,000. The Partnership received net proceeds of $2,114,610 and
recognized a gain of $556,268 ($6.70 per limited partnership unit). A
disposition fee of $66,600 was accrued but not paid to the Advisor. On March 15,
2000 the Partnership made a capital distribution of $1,973,472 ($24 per limited
partnership unit) from the sale proceeds.
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
The following is a summary of the Partnership's last remaining investment
in property (one at March 31, 2000 and two at December 31, 1999):
March 31, 1999 December 31, 1999
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Building and improvements $ 8,489,529 $ 8,480,975
Accumulated depreciation (1,774,590) (1,665,207)
Loan to ground lessor 1,431,366 1,445,320
Lease commissions and other
assets, net 341,629 249,698
Accounts receivable 357,495 311,195
Accounts payable (86,417) (126,075)
Property held for disposition -- 1,491,742
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$ 8,759,012 $ 10,187,648
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The Partnership recognized a net loss of $22,217 for the year ended 1999 from
the Waters Landing investment which was held for disposition at December 31,
1999.
NOTE 4 - SUBSEQUENT EVENT
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Distributions of cash from operations relating to the quarter ended March
31, 2000 were made on April 27, 2000 in the aggregate amount of $357,152 ($4.30
per limited partnership unit.)
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Liquidity and Capital Resources
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The Partnership completed its offering of limited partnership units in
December 1988. A total of 83,291 units were sold. The Partnership received
proceeds of $74,895,253, net of selling commissions and other offering costs,
which have been used for investment in real estate, for the payment of related
acquisition costs and for working capital reserves. The Partnership made nine
real estate investments, eight of which have been sold: two in 1994, two in
1997, three in 1999, and one in 2000. As a result of the sales, capital of
$59,850,280 has been returned to the limited partners through March 31, 2000.
The adjusted capital contribution was reduced to $952 from $1,000 per unit in
1994, to $924 in 1995, to $616 in 1997, to $367 in 1999 and then to $273 in
2000.
At March 31, 2000, the Partnership had $6,415,646 in cash and cash
equivalents, of which $357,152 was used for cash distributions to partners on
April 27, 2000; the remainder will be used to complete the funding of real
estate investments or be retained as working capital reserves. The source of
future liquidity and cash distributions to partners will be cash generated by
the Partnership's invested cash and cash equivalents and real estate
investments. Distributions of cash from operations relating to the first quarter
of 2000 were made at an annualized rate of 5.5% on the weighted average adjusted
capital contribution of $312.52. Distributions of cash from operations relating
to the first quarter of 1999 were made at the annualized rate of 6.50% on the
adjusted capital contribution of $616. The distribution rate decreased between
the first quarter of 1999 and 2000 due to the decrease in operational cash flow
as a result of the four property sales between the two respective periods.
The carrying value of real estate investments in the financial statements
is at depreciated cost, or if the investment's carrying value is determined not
to be recoverable through expected undiscounted future cash flows, the carrying
value is reduced to estimated fair market value. The fair market value of such
investments is further reduced by the estimated cost of sale for properties held
for sale. Carrying value may be greater or less than current appraised value. At
March 31, 2000, the appraised value of the remaining investment exceeded its
related carrying value by an aggregate of $39,000. The current appraised value
of the real estate investment has been estimated by the managing general partner
and is generally based on a combination of traditional appraisal approaches
performed by the Partnership's Advisor and independent appraisers. Because of
the subjectivity inherent in the valuation process, the estimated current
appraised value may differ significantly from that which could be realized if
the real estate were actually offered for sale in the marketplace.
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
Results of Operations
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Santa Rita Plaza is a wholly-owned property. Waters Landing II, Puente
Street and Dahlia, which were sold in February 2000, June 1999 and August 1999,
respectively, were also wholly-owned properties. Columbia Gateway Corporate Park
was structured as a joint venture with a real estate development/management firm
and an affiliate of the Partnership. Columbia Gateway was sold on December 20,
1999.
Operating Factors
As mentioned above, the Columbia Gateway Corporate Park joint venture
investment in which the Partnership and an affiliate were entitled to 30.5% and
69.5% of the operating activity, respectively, sold its property on December
20,1999. The Partnership recognized its 30.5% share of the gain of $957,057. The
property was 100% leased at the time of sale.
As mentioned above, the Puente Street property was sold on June 25, 1999
and the Partnership recognized a gain of $104,974. The property was 100% leased
at the time of sale.
As mentioned above, the Dahlia property was sold on August 27, 1999 and the
Partnership recognized a gain of $3,367,359. The property was 100% leased at the
time of sale.
As mentioned above, the Waters Landing II property was sold on December 20,
1999 and the Partnership recognized a gain of $556,268.
Occupancy at Santa Rita Plaza during the first quarter of 2000 was 100%
compared with 91% at March 31, 1999.
Investment Activity
Interest on cash equivalents for the first quarter of 2000 increased
approximately $21,000 compared to the same period of 1999. This was primarily
due to higher investment balances as a result of the temporary investment of
proceeds from the sales of Columbia Gateway and Waters Landing II on December
20, 1999 and February 17, 2000, respectively, prior to distribution to the
partners.
Real estate operations decreased $212,389 between the first quarter of 2000
and the comparable quarter of 1999. This decrease is the result of the sales of
Puente Street, Dahlia and Columbia Gateway in June 1999, August 1999 and
December 1999, respectively.
Cash flow from operations decreased approximately $411,000 between the
first quarter of 2000 and 1999. This decrease is primarily due to the sales of
Puente Street, Dahlia and Columbia Gateway in June 1999, August 1999 and
December 1999, respectively.
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
Portfolio Expenses
The Partnership management fee is 9% of distributable cash flow from
operations after any increase or decrease in working capital reserves as
determined by the managing general partner. General and administrative expenses
consist primarily of real estate appraisal, printing, legal, accounting and
investor servicing fees.
The Partnership management fee decreased between the first quarter of 2000
and 1999 due to a decrease in distributable cash flow. General and
administrative expenses remained relatively stable between the first quarter of
1999 and 2000.
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NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
FORM 10-Q
FOR QUARTER ENDED MARCH 31, 2000
PART II
OTHER INFORMATION
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Item 6. Exhibits and Reports on Form 8-K
a. Exhibits: (27) Financial Data Schedule
b. Reports on Form 8-K: During the quarter ended March 31, 2000
two current reports on Form 8-K were filed. The first one was
filed on January 3, 2000 reporting on Item No. 2 (Acquisition or
Disposition of Assets) and Item No. 7 (Financial Statements and
Exhibits), relating in both cases to the December 20, 1999 sale
of real property by Columbia Gateway Joint Venture and the second
was filed on February 29, 2000 reporting on Item No. 2
(Acquisition or Disposition of Assets) and Item No. 7 (Financial
Statements and Exhibits), relating in both cases to the February
17, 2000 sale of Waters Landing II.
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SIGNATURES
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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.
NEW ENGLAND PENSION PROPERTIES V;
A REAL ESTATE LIMITED PARTNERSHIP
(Registrant)
May 5, 2000
/s/ Alison Husid Cutler
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Alison Husid Cutler
President, Chief Executive Officer
and Director of Managing General Partner,
Fifth Copley Corp.
May 5, 2000
/s/ Karin J. Lagerlund
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Karin J. Lagerlund
Principal Financial and Accounting
Officer of Managing General Partner,
Fifth Copley Corp.
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