UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
(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, 2001
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 000-16757
CONCORD MILESTONE PLUS, L.P.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 52-1494615
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(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
150 EAST PALMETTO PARK ROAD
4TH FLOOR
BOCA RATON, FLORIDA 33432
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(Address of Principal Executive Offices) (Zip Code)
(561) 394-9260
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Registrant's Telephone Number, Including Area Code
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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 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 [ ]
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONCORD MILESTONE PLUS, L.P.
(A LIMITED PARTNERSHIP)
BALANCE SHEETS
MARCH 31, 2001 (UNAUDITED) AND DECEMBER 31, 2000
March 31, 2001 December 31,2000
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Assets:
Property:
Building and improvements, at cost $15,911,310 $15,911,310
Less: accumulated depreciation 7,352,026 7,201,754
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Building and improvements, net 8,559,284 8,709,556
Land, at cost 10,987,034 10,987,034
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Property, net 19,546,318 19,696,590
Cash and cash equivalents 726,725 625,426
Accounts receivable and other assets 279,399 317,865
Restricted cash 264,828 230,189
Debt financing costs, net 203,669 211,503
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Total assets $21,020,939 $21,081,573
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Liabilities:
Mortgage loans payable $16,073,406 $16,130,734
Accrued interest 113,021 113,424
Deposits 87,266 87,266
Accrued expenses and other liabilities 157,415 159,147
Accrued expenses payable to affiliates 79,662 62,754
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Total liabilities 16,510,770 16,553,325
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Commitments and Contingencies
Partners' capital:
General partner (77,463) (77,282)
Limited partners:
Class A Interests, 1,518,800 4,587,632 4,605,530
Class B Interests, 2,111,072 - -
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Total partners' capital 4,510,169 4,528,248
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Total liabilities and partners' capital $21,020,939 $21,081,573
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See Accompanying Notes to Financial Statements
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CONCORD MILESTONE PLUS, L.P.
(A LIMITED PARTNERSHIP)
STATEMENTS OF REVENUES AND EXPENSES
(UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
March 31, 2001 March 31, 2000
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Revenues:
Rent $661,642 $631,613
Reimbursed expenses 100,040 110,289
Interest and other income 11,930 5,904
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Total revenues 773,612 747,806
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Expenses:
Interest expense 328,589 332,671
Depreciation and amortization 160,341 156,209
Management and property expenses 235,535 216,109
Administrative and management fees to related party 49,929 47,891
Professional fees and other expenses 17,297 17,857
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Total expenses 791,691 770,737
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Net loss $(18,079) $(22,931)
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Net loss attributable to:
Limited partners $(17,898) $(22,702)
General partner (181) (229)
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Net loss $(18,079) $(22,931)
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Loss per weighted average
Limited Partnership 100 Class A
Interests outstanding, basic & diluted $ (1.19) $ (1.51)
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Weighted average number of 100
Class A interests outstanding 15,188 15,188
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See Accompanying Notes to Financial Statements
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CONCORD MILESTONE PLUS, L.P.
(A LIMITED PARTNERSHIP)
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
(UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2001
General Class A Class B
Total Partner Interests Interests
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PARTNERS' CAPITAL (DEFICIT)
January 1, 2001 $4,528,248 $(77,282) $4,605,530 $0
Net Loss (18,079) (181) (17,898) 0
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PARTNERS' CAPITAL (DEFICIT)
March 31, 2001 $4,510,169 $ (77,463) $4,587,632 $0
========== ========= ========== ==
See Accompanying Notes to Financial Statements
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CONCORD MILESTONE PLUS, L.P.
(A LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
(UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
March 31, 2001 March 31, 2000
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss income $(18,079) $(22,931)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 160,341 156,209
Change in operating assets and liabilities:
Decrease (increase) in accounts receivable and other assets 36,231 (10,268)
Decrease in accrued interest (403) (4,067)
(Decrease) increase in accrued expenses and other liabilities (1,732) 109,237
Increase (decrease) in accrued expenses payable to affiliates 16,908 (8,293)
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Net cash provided by operating activities 193,266 219,887
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CASH FLOWS FROM INVESTING ACTIVITIES:
Property improvements 0 (7,874)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in restricted cash (34,639) (88,845)
Principal repayments on mortgage loans payable (57,328) (49,580)
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Net cash used in financing activities (91,967) (138,425)
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NET INCREASE
CASH AND CASH EQUIVALENTS 101,299 73,588
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 625,426 561,737
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CASH AND CASH EQUIVALENTS,
END OF PERIOD $726,725 $635,325
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid during the period for interest $328,992 $336,738
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See Accompanying Notes to Financial Statements
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INDEPENDENT ACCOUNTANTS' REPORT
To the Board of Directors of
Concord Milestone Plus, L.P.
We have reviewed the accompanying balance sheet of Concord Milestone Plus, L.P.
(the "Partnership") as of March 31, 2001, and the related statements of revenues
and expenses, changes in partners' capital, and cash flows for the three month
periods ended March 31, 2001 and March 31, 2000. These financial statements are
the responsibility of the management of the Partnership.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with generally accepted accounting principles.
/s/ Ahearn, Jasco + Company, P.A.
AHEARN, JASCO + COMPANY, P.A.
Certified Public Accountants
Pompano Beach, Florida
May 4, 2001
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CONCORD MILESTONE PLUS, L.P.
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2001
The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q and Rule 10-01 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. The
financial statements as of and for the periods ended March 31, 2001 and 2000 are
unaudited. The financial statements for the periods ended March 31, 2001 and
2000 have been reviewed by an independent public accountant pursuant to Rule
10-01(d) of Regulation S-X and following applicable standards for conducting
such reviews, and the report of the accountant is included as part of this
filing. The results of operations for the interim periods shown in this report
are not necessarily indicative of the results of operations for the fiscal year.
Certain information for 2000 has been reclassified to conform to the 2001
presentation. These interim financial statements should be read in conjunction
with the annual financial statements and footnotes included in the Partnership's
financial statements filed on Form 10-K for the year ended December 31, 2000.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
GENERAL
This Form 10-Q and documents incorporated herein by reference, if any,
contain forward-looking statements that have been made within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Such forward-looking statements are
based on current expectations, estimates and projections about the Partnership's
(as defined below) industry, management beliefs, and certain assumptions made by
the Partnership's management and involve known and unknown risks, uncertainties
and other factors. Such factors include the following: general economic and
business conditions, which will, among other things, affect the demand for
retail space or retail goods, availability and creditworthiness of prospective
tenants, lease rents and the terms and availability of financing; risks of real
estate development and acquisition; governmental actions and initiatives; and
environmental and safety requirements. These statements are not guarantees of
future performance and are subject to certain risks, uncertainties and
assumptions that are difficult to predict; therefore, actual results may differ
materially from those expressed or forecasted in any such forward-looking
statements.
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ORGANIZATION AND CAPITALIZATION
Concord Milestone Plus, L.P., a Delaware limited partnership (the
"Partnership"), was formed on December 12, 1986, for the purpose of investing in
existing income-producing commercial and industrial real estate. The Partnership
began operations on August 20, 1987, and currently owns and operates three
shopping centers located in Searcy, Arkansas; Valencia, California; and Green
Valley, Arizona.
The Partnership commenced a public offering on April 8, 1987 in order to
fund the Partnership's real property acquisitions. The Partnership terminated
its public offering on April 2, 1988 and was fully subscribed to with a total of
16,452 Bond Units and 15,188 Equity Units issued. Each Bond Unit consisted of
$1,000 principal amount of Bonds and 36 Class B Interests. The Partnership
redeemed all of the outstanding Bonds as of September 30, 1997 with the proceeds
of three new fixed rate mortgage loans. Each Equity Unit consists of 100 Class A
Interests and 100 Class B Interests. Capital contributions to the Partnership
consisted of $15,187,840 from the sale of the Equity Units and $592,272 which
represent the Class B Interests from the sale of the Bond Units.
RESULTS OF OPERATIONS
COMPARISON OF THREE MONTHS ENDED MARCH 31, 2001 TO THREE MONTHS ENDED MARCH 31,
2000
The Partnership recognized net loss of $18,079 for the three months ended
March 31, 2001 as compared to net loss of $22,931 for the same period in
2000.The change is primarily due to the following factors:
(i) An increase in base rent of $30,029 or 4.75% to $661,642 for three
months ended March 31, 2001 as compared to $631,613 for three months ended March
31, 2000. This increase is due to a decrease in vacancies and an increase in
base rent at the Valencia and Green Valley Properties.
(ii) An increase in management and property expenses of $19,426 or 8.99% to
$235,535 for the three months ended March 31, 2001 as compared to $216,109 for
the three months ended March 31, 2000. This increase is primarily due to an
increase in real estate taxes at the Green Valley Property that are not
recoverable from tenants.
LIQUIDITY AND CAPITAL RESOURCES
The General Partner believes that the Partnership's expected revenue and
working capital is sufficient to meet the Partnership's current and future
operating requirements for the next 12 months. Nevertheless, because the cash
revenues and expenses of the Partnership will depend on future facts and
circumstances relating to the Partnership's properties, as well as market and
other conditions beyond the control of the Partnership, a possibility exists
that cash flow deficiencies may occur.
During February 1999, the Partnership received notice from Abco, a principal
anchor tenant at the Green Valley Property, that Abco would not be renewing its
lease at the expiration of its current term on July 31, 1999. Abco vacated its
space in May, 1999. The Partnership retained a large regional real estate
brokerage firm to help market the space and has shown the space to several
qualified prospective tenants. No replacement tenant has yet been identified.
The plan to build Safeway Supermarket in the year 2002 near Green Valley Mall
will also have the adverse effect of reducing the likelihood of replacing Abco
with another supermarket. A supermarket is considered the best potential anchor
tenant because of the increased daily traffic it would generate at the property.
Additionally, the store space is configured for a supermarket use and the costs
of re-demising the space for another user (or users) could be substantial.
Currently, approximately $150,000 of the Partnership's working capital is being
held in escrow in connection with the refinancing by the holder of the first
mortgage on the Green Valley Property (the "Lender") pending the resolution of
the vacancy in this unoccupied anchor tenant space. It is not possible to
determine the long-term effects of the vacancy of the Abco space. Many of the
tenants at the Green Valley Property have short term leases. Currently, however,
the vacancy of the Abco space has not had a material adverse effect on the
leasing of store spaces on favorable terms.
-8-
The Partnership has made distributions to its partners in the past.
Distributions were suspended after the second quarter of 1999 following the
departure of Abco from the Green Valley Property, which created vacant anchor
tenant space. Additionally, several capital projects were undertaken and
completed at the Properties. Further a 15,600 square foot anchor tenant at the
Searcy Property filed for Chapter 11 bankruptcy protection and vacated its store
space during the second quarter of 1998 and payment ended during the second
quarter of 2000. This space has been released to a new tenant during the first
quarter of 2001. Finally, the Partnership is under contract with a third party
to make extensive roof repairs and/or replacements at the Valencia Property in
fiscal year 2001. The Partnership will evaluate the amount of future
distributions, if any, on a quarter by quarter basis. No assurances can be given
as to the timing or amount of any future distributions by the Partnership.
Management is not aware of any other significant trends, events, commitments
or uncertainties that will or are likely to materially impact the Partnership's
liquidity.
The cash on hand at March 31, 2001 may be used to fund (a) costs associated
with releasing the Abco space should the costs of releasing exceed the $150,000
already held in escrow by the Lender for this purpose and (b) other general
Partnership purposes.
Net cash provided by operating activities of $193,266 for the three months
ended March 31, 2001 included (i) net loss of $18,079, (ii) non-cash adjustments
of $160,341 for depreciation and amortization expense and (iii) a net change in
operating assets and liabilities of $51,004.
Net cash provided by operating activities of $219,887 for the three months
ended March 31, 2000 included (i) net loss of $22,931, (ii) non-cash adjustments
of $156,209 for depreciation and amortization expense and (iii) a net change in
operating assets and liabilities of $86,609.
Net cash used in investing activities of $7,874 for the three months ended
March 31, 2000 was for capital expenditures for property improvements.
Net cash used in financing activities of $91,967 for the three months ended
March 31, 2001 include (i) principal repayments on mortgage loans payable of
$57,328 and (ii) an increase in restricted cash of $34,639.
Net cash used in financing activities of $138,425 for the three months ended
March 31, 2000 included (i) principal repayments on mortgage loans payable of
$49,580, and (ii) an increase in restricted cash of $88,845.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Partnership, in its normal course of business, is theoretically exposed
to interest rate changes as they relate to real estate mortgages and the effect
of such mortgage rate changes on the values of real estate. However, for the
Partnership, all of its mortgage debt is at fixed rates, is for extended terms,
and would be unaffected by any sudden change in interest rates. The
Partnership's possible risk is from increases in long-term real estate mortgage
rates that may occur over a decade or more, as this may decrease the overall
value of real estate. Since the Partnership has the intent to hold its existing
mortgages to maturity (or until the sale of a Property), there is believed to be
no interest rate market risk on the Partnership's results of operations or its
working capital position.
The Partnership's cash equivalents and short-term investments, if any,
generally bear variable interest rates. Changes in the market rates of interest
available will affect from time-to-time the interest earned by the Partnership.
Since the Partnership does not rely on its interest earnings to fund working
capital needs, changes in these interest rates will not have an impact on the
Partnership's results of operations or working capital position.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBIT:
Number Description of Document
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3.1 Amended and Restated Agreement of Limited Partnership of Concord Milestone Plus,
L.P. Incorporated herein by reference to Exhibit A to the Registrant's Prospectus
included as Part I of the Registrant's Post-Effective Amendment No. 3 to the
Registrant's Registration Statement on Form S-11 (the "Registration Statement")
which was declared effective on April 3, 1987.
3.2 Amendment No. 1 to Amended and Restated Agreement of Limited Partnership of
Concord Milestone Plus, L.P., included as Exhibit 3.2 to Registrant's Form 10-K for
the fiscal year ended December 31, 1987 ("1987 Form 10-K"), which is incorporated
herein by reference.
3.3 Amendment No. 2 to Amended and Restated Agreement of Limited Partnership of
Concord Milestone Plus, L.P. included as Exhibit 3.3 to the 1987 form 10-K, which
is incorporated herein by reference.
3.4 Amendment No. 3 to Amended and Restated Agreement of Limited Partnership of
Concord Milestone Plus, L.P. included as Exhibit 3.4 to the 1987 Form 10-K, which
is incorporated herein by reference.
3.5 Amendment No. 4 to Amended and Restated Agreement of Limited Partnership of
Concord Milestone Plus, L.P. included as Exhibit 3.5 to the 1987 Form 10-K, which
is incorporated herein by reference.
3.6 Amendment No. 5 to Amended and Restated Agreement of Limited Partnership of
Concord Milestone Plus, L.P. included as Exhibit 3.6 to Registrant's Form 10-K for
the fiscal year ended December 31, 1988, which is incorporated herein by reference.
27 Financial Data Schedule is included.
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(b) REPORTS:
No reports on form 8-K were filed during the quarter covered by this Report.
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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.
DATE: CONCORD MILESTONE PLUS, L.P.
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(Registrant)
BY: CM PLUS CORPORATION
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General Partner
By: /S/ Robert Mandor
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Robert Mandor
Director and Vice President
By: /S/ Patrick Kirse
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Patrick Kirse
Treasurer and Controller
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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.
DATE: CONCORD MILESTONE PLUS, L.P.
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(Registrant)
BY: CM PLUS CORPORATION
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General Partner
By:
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Robert Mandor
Director and Vice President
By:
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Patrick Kirse
Treasurer and Controller
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