UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended: November 30, 1998
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: 0-014341
CONAM REALTY INVESTORS 5 L.P.
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EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER
California 11-2712111
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STATE OR OTHER JURISDICTION OF INCORPORATION I.R.S. EMPLOYER IDENTIFICATION NO.
1764 San Diego Avenue
San Diego, CA 92110 Attn.: Robert J. Svatos 92110-1906
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ADDRESS OF PRINCIPAL EXECUTIVE OFFICES ZIP CODE
Registrant's telephone number, including area code (619) 297-6771
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Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
UNITS OF LIMITED PARTNERSHIP INTEREST
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TITLE OF CLASS
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 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
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. (X)
Documents Incorporated by Reference:
Portions of Parts I, II, III and IV are incorporated by reference to the
Partnership's Annual Report to Unitholders for the fiscal year ended November
30, 1998.
PART I
ITEM 1. BUSINESS
(a) GENERAL DESCRIPTION OF BUSINESS AND OBJECTIVES
ConAm Realty Investors 5 L.P., formerly known as Hutton/ConAm Realty
Investors 5 (the "Partnership"), is a California limited partnership formed
on June 28, 1984. ConAm Property Services IV, Ltd. ("CPS IV"), a California
limited partnership, and RI 5 Real Estate Services, Inc. ("RI 5"), a Delaware
corporation, were the original co-general partners of the Partnership. On
January 27, 1998, CPS IV acquired RI 5's co-general partner interest in the
Partnership, effective July 1, 1997, pursuant to a Purchase Agreement between
CPS IV and RI 5 dated August 29, 1997. As a result, CPS IV now serves as the
sole general partner (the "General Partner") of the Partnership. In
conjunction with this transaction, the name of the Partnership was changed
from Hutton/ConAm Realty Investors 5 to ConAm Realty Investors 5 L.P.
The Partnership was organized to engage in the business of acquiring,
operating and holding for investment multifamily residential properties. The
Partnership originally invested in one residential apartment property and two
joint ventures, each of which owned a specified property. As described
below, as of January 29, 1999, all of the Partnership's investments in the
properties have been sold, and the General Partner anticipates that the final
liquidation of the Partnership will be completed in mid-1999.
The Partnership's principal investment objectives with respect to its
interests in real property were:
(1) capital appreciation;
(2) distribution of net cash from operations attributable to rental income;
and
(3) preservation and protection of capital.
Distribution of net cash from operations was the Partnership's objective
during its operational phase, while preservation and appreciation of capital
were the Partnership's long-term objectives. The attainment of the
Partnership's investment objectives was dependent on many factors, including
future economic conditions in the United States as a whole and, in
particular, in the localities in which the Partnership's properties were
located, especially with regard to achievement of capital appreciation.
The Partnership utilized the proceeds of its public offering to acquire three
residential apartment complexes either directly or through investments in
joint ventures, as follows: (1) Lakeview Village at Ponte Vedra, a 240-unit
apartment complex, located in Ponte Vedra Beach, Florida; (2) The Hamptons
at Quail Hollow, a 232-unit apartment complex, located in Charlotte, North
Carolina; and (3) Canterbury Park Apartments, a 96-unit apartment complex,
located in Raleigh, North Carolina. On December 10, 1996, Canterbury Park
was sold to an unaffiliated buyer for $6,387,300.
During its fiscal year ended November 30, 1998, following consideration of
various alternatives available to the Partnership, the General Partner
concluded that a sale of the Partnership's two remaining properties, Lakeview
Village and The Hamptons at Quail Hollow (collectively the "Properties"),
would be in the best interests of the Partnership and the Unitholders.
Throughout much of fiscal 1998, the General Partner, on behalf of the
Partnership, negotiated the terms of a sale of the Properties with Lend Lease
Real Estate Investments, Inc. ("Lend Lease"), on behalf of two pension funds
which are unaffiliated with the General Partner. Once the terms were
negotiated, as required by the Partnership's Second Amended and Restated
Certificate and Agreement of Limited Partnership ("Agreement of Limited
Partnership"), the General Partner solicited the consent of a majority in
interest of the Unitholders to the sale pursuant to a Consent Solicitation
Statement dated December 16, 1998. The requisite consent was obtained on
January 15, 1999, and on January 29, 1999, the Partnership consummated the
sale of the Properties to DOC Investors, L.L.C., a Delaware limited liability
company (the "Purchaser"), for a sales price of $26,000,000 (before selling
costs and prorations). The members of the Purchaser are two pension funds
advised by Lend Lease, which own an aggregate 91% interest in the Purchaser,
and ConAm DOC Affiliates LLC, an affiliate of the General Partner ("ConAm
DOC"), which owns a 9% interest in the Purchaser. ConAm DOC has the potential
to receive up to an additional 18% of the profits of the Purchaser after
certain priority returns to the members of the Purchaser.
The Partnership received approximately $19,482,000 of cash proceeds from the
sale, net of closing costs of approximately $110,000 and repayment of
indebtedness of approximately $6,408,000. All net cash proceeds from the
sale and previously undistributed cash from operations, less an amount the
General Partner determined to set aside for contingencies, were distributed
to the Limited Partners on February 26, 1999.
The Partnership considers itself to have been engaged in only one industry
segment, real estate investment.
COMPETITION
The Partnership's former real property investments were subject to
competition from similar types of properties in the vicinities in which they
were located. Such former competition increased during the Partnership's
period of ownership of the Properties due principally to the addition of
newly constructed apartment complexes offering increased residential and
recreational amenities. The Properties were also subject to competition from
condominiums and single-family properties especially as potential renters
chose to buy homes especially during periods of low mortgage interest rates.
The Partnership competed with other real estate owners and developers in the
rental and leasing of its Properties by offering competitive rental rates
and, if necessary, leasing incentives. Such competition affected the
occupancy levels and revenues of the Properties. The occupancy level at
Lakeview Village in Florida reflects some seasonality, which is typical in
this market. In some cases, the Properties competed with properties owned by
partnerships affiliated with the General Partner.
For a discussion of market conditions in the areas where the Properties were
located, reference is made to the Partnership's Annual Report to Unitholders
for the fiscal year ended November 30, 1998, which is filed as an exhibit
under Item 14.
EMPLOYEES
The Partnership has no employees. Services are provided by CPS IV and ConAm
Management Corporation ("ConAm Management"), an affiliate of CPS IV. Pursuant
to property management agreements with the Partnership, ConAm Management
provided property management services with respect to the Properties. In
addition, the Partnership retains Brock, Tibbitts & Snell, an unaffiliated
company located in San Diego, California, to provide all accounting and
investor communication functions. During fiscal 1998, Service Data
Corporation, an unaffiliated company, provided transfer agent services for
the Partnership. During February 1999, pursuant to the terms of a sale of
its contracts, Service Data Corporation assigned the transfer agent functions
of the Company to MAVRICC Management Systems, Inc., an unaffiliated company
located in Troy, Michigan. See Item 13, "Certain Relationships and Related
Transactions", for a further description of the service and management
agreements between the Partnership and affiliated entities.
ITEM 2. PROPERTIES
For a description of the Properties owned and operated by the Partnership
during fiscal 1998 and discussion of market conditions in the areas where the
Properties are located, reference is made to the Partnership's Annual Report
to Unitholders for the fiscal year ended November 30, 1998, which is filed as
an exhibit under Item 14. For information on the Partnership's purchase of
the Properties, reference is made to Note 4 of the Consolidated Financial
Statements, included herein by reference to the Partnership's Annual Report
to Unitholders. For information on the sale of the Properties by the
Partnership in January, 1999, reference is made to Item 1 and Note 10 of the
Consolidated Financial Statements, included herein by reference to the
Partnership's Annual Report to Unitholders. Average occupancy rates at each
property are incorporated by reference to Item 7.
ITEM 3. LEGAL PROCEEDINGS
The Partnership is not subject to any material pending legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the fourth quarter of the fiscal year ended November 30, 1998, no
other matters were submitted to a vote of Unitholders through the
solicitation of proxies or otherwise. On December 16, 1998, the Unitholders
were asked to approve a sale of the Partnership's remaining properties. A
majority in interest of the Unitholders approved the sale and the sale was
completed on January 29,1999.
Page 3
PART II
ITEM 5. MARKET FOR THE PARTNERSHIP'S LIMITED PARTNERSHIP INTERESTS AND
RELATED SECURITY HOLDER MATTERS
As of November 30, 1998, the number of Unitholders of record was 2,514.
No established public trading market exists for the Units, and it is not
anticipated that such a market will develop in the future.
Distributions of Net Cash From Operations, when made, are determined by the
General Partner on a quarterly basis, with distributions generally occurring
approximately 45 days after the end of each fiscal quarter. Such
distributions to the Unitholders have been made from net operating income
with respect to the Partnership's investment in the Properties and from
interest on short-term investments. Information on cash distributions paid
by the Partnership for the past two fiscal years is incorporated by reference
to the Partnership's Annual Report to Unitholders for the fiscal year ended
November 30, 1998, which is filed as an exhibit under Item 14. No
distributions was made for the fourth quarter of the fiscal year ended
November 30, 1998 because the General Partner decided to suspend
distributions pending the outcome of the solicitation of the consent of the
Unitholders to the sale of the Properties.
Because of the sale of the Partnership's remaining Properties, no further
quarterly distributions of Net Cash From Operations will be made. The
Partnership distributed $19,402,875 to the Unitholders ($337.50 per Unit) and
$1,340 to the General Partner on February 26, 1999, which amounts are equal
to substantially all of the net proceeds from the sale of the Properties,
together with other available cash of the Partnership, less an amount for
costs associated with the sale and liquidation and other contingencies, net
of expected cash provided by operations through the date of sale, of
approximately $554,000. The final liquidation of the Partnership is expected
to occur in mid-1999, and the remaining funds, if any, will be distributed to
the Unitholders at that time.
ITEM 6. SELECTED FINANCIAL DATA
Incorporated by reference to the Partnership's Annual Report to Unitholders
for the year ended November 30, 1998, which is filed as an exhibit under Item
14.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
At November 30, 1998, the Partnership had cash and cash equivalents of
$424,001, which were invested in unaffiliated money market funds, compared
with $1,424,876 at November 30, 1997. The decrease in cash and cash
equivalents reflects mortgage principal payments, additions to real estate
and cash distributions to Partners exceeding cash provided by operating
activities during the fiscal year ended November 30, 1998. The Partnership
also maintains a restricted cash balance that totaled $261,132 at November
30, 1998, largely unchanged from $224,210 at November 30, 1997. The increase
in other assets in fiscal 1998 is primarily attributed to an increase in a
deposit required by the Internal Revenue Service and prepaid selling costs.
Distribution payable decreased to $0 at November 30, 1998, compared to
$359,019 at November 30, 1997. The decrease is primarily attributable to the
decision of the General Partner to suspend distributions pending the outcome
of the solicitation of the consent of the Unitholders to the sale of the
remaining Properties.
Accounts payable and accrued expenses is relatively unchanged and total
$387,989 at November 30, 1998, compared to $388,948 at November 30, 1997.
Security deposits decreased to $73,629 at November 30, 1998, compared to
$89,448 at November 30, 1997. This decrease occurred while occupancy
increased during that same period. This decrease in security deposits
occurred primarily because strong competition has reduced the ability of
property owners to collect refundable security deposits from their tenants.
The Partnership continued to perform various improvements at the Properties
during fiscal 1998 which include the completion of the roof replacements at
Lakeview Village, the majority of which was completed during the period
commencing with the fourth quarter of fiscal 1997 through the second quarter of
fiscal 1998. The approximate cost of replacing the roof was
Page 4
$800,000 of which $400,000 was funded in fiscal 1998 and $400,000 was funded
in fiscal 1997 from the Partnership's operating cash flow and cash reserves.
During fiscal 1998, the Partnership received insurance proceeds of $254,945
from claims resulting from fire damage to eight units at Lakeview Village.
The insurance proceeds were sufficient to cover the cost of the restoration
work.
As a result of the Partnership's sale of the Properties on January 29, 1999,
all of the Partnership's assets have been converted to cash and cash
equivalents. Pending distribution to the Unitholders as described in Item 5
above, the Partnership's funds have been invested in the Pacific Horizon
Money Market Funds, Prime Fund. The General Partner retained from the
initial distribution an amount it believes is sufficient to provide for
contingencies, and to cover the expenses of operating the Partnership until
final liquidation of the Partnership, including legal and accounting fees.
RESULTS OF OPERATIONS
1998 VERSUS 1997
Partnership operations for the fiscal year ended November 30, 1998 resulted
in net income of $247,691 compared with net income of $2,687,490 in fiscal
1997. The decrease in net income is primarily attributable to a $2,582,641
gain recognized on the sale of Canterbury Park in fiscal 1997. Excluding the
gain, the Partnership generated income from operations of $104,849 for fiscal
1997. The increase in operating income in fiscal 1998 is primarily due to an
increase in rental income and a decrease in property operating costs somewhat
offset by an increase in write-off assets as they were replaced.
Net cash provided by operating activities was $1,000,284 for the fiscal year
ended November 30, 1998 compared to $1,112,952 in fiscal 1997. The decrease
in cash provided by operating activities is primarily attributable to an
increase in other assets.
Rental income for the fiscal year ended November 30, 1998 was $3,970,095
compared with $3,714,870 in fiscal 1997. The increase is primarily due to
relatively stable occupancy at The Hamptons at Quail Hollow and improved
occupancy at Lakeview Village and improved rental rates at both of the
properties partially offset by the sale of Canterbury Park in December of
1996. Interest income totaled $37,894 for the fiscal year ended November 30,
1998 compared to $130,067 in fiscal 1997. The decrease is due to the
Partnership maintaining lower average cash balances in fiscal 1998 than in
fiscal 1997 from proceeds held for the sale of Canterbury Park in fiscal 1997.
Property operating expenses decreased slightly to $2,055,840 for the fiscal
year ended November 30, 1998, as compared $2,123,570 for fiscal 1997. This
decrease is primarily due to the sale of Canterbury Park in December of 1996
and a decrease in property operating expenses at The Hamptons at Quail Hollow.
Write-off of assets increased to $162,037 for fiscal year end November 30,
1998 from $85,000 for fiscal 1997. The increase is due to an increase in
roof replacements at Lakeview Village in fiscal 1998.
1997 VERSUS 1996
Partnership operations for the fiscal year ended November 30, 1997 generated
net income of $2,687,490, compared with net income of $1,017,032 in fiscal
1996. The increase in net income is primarily attributable to a $2,582,641
gain recognized on the sale of Canterbury Park. Excluding the gain, the
Partnership generated income from operations of $104,849. Net cash provided
by operating activities was $1,112,952 for the fiscal year ended November 30,
1997 compared to $2,022,547 in fiscal 1996. The decrease in cash provided
by operating activities is primarily attributable to the sale of Canterbury
Park.
Rental income totaled $3,714,870 for the fiscal year ended November 30, 1997
compared with $4,695,358 in fiscal 1996. The decrease is primarily
attributable to the sale of Canterbury Park, and to a lesser extent, a
decline in rental income at Lakeview Village due to lower occupancy.
Property operating expenses totaled $2,123,570 for the fiscal year ended
November 30, 1997 compared with $2,120,789 in fiscal 1996. The increase is
primarily due to higher rental administrative expenses and parking lot
repairs at Lakeview Village. The increase is also attributable to higher
maintenance expenses and asphalt repairs at the Hamptons at Quail
Page 5
Hollow. Depreciation and amortization declined from $1,027,524 for the fiscal
year ended November 30, 1996 to $879,851 in fiscal 1997. The decrease is
primarily due to the sale of Canterbury Park and to certain furniture,
fixtures and equipment becoming fully depreciated.
General and administrative expenses increased from $140,163 in fiscal 1996 to
$167,485 in fiscal 1997. The increase is primarily attributable to an
increase in costs associated with Partnership accounting, tax and
administrative services. During the 1997 period, certain expenses incurred
by RI 5, its affiliates, and an unaffiliated third party service provider in
servicing the Partnership, which were voluntarily absorbed by affiliates of
RI 5 in prior periods, were reimbursable to RI 5 and its affiliates.
The average occupancy levels at each of the properties owned for the full
year during the years ended November 30, 1998, 1997 and 1996 were as follows:
TWELVE MONTHS ENDED NOVEMBER 30,
--------------------------------
Property 1998 1997 1996
-------- ---- ---- ----
The Hamptons at Quail Hollow 96% 94% 96%
Lakeview Village 94% 88% 96%
NEW ACCOUNTING PRONOUNCEMENTS
The Financial Accounting Standards Board has issued issued SFAS No. 129,
"Disclosure of Information about Capital Structure," SFAS No. 130, "Reporting
Comprehensive Income," and SFAS No. 131, "Disclosure about Segments of an
Enterprise and Related Information." These statements, which are effective
for fiscal years beginning after December 15, 1997, expand or modify
disclosures and, accordingly, will have no impact on the Partnership's
reported financial position, results of operations or cash flows.
YEAR 2000
Due to the consummation of the sale of the Properties in January 1999, the
Partnership is no longer engaged in the operation of real properties or any
other business. As a result of the foregoing, and in view of the General
Partner's plan to complete the full liquidation of the Partnership prior to
January 1, 2000, the Partnership has no exposure to Year 2000 issues.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Since the Partnership sold its remaining Properties on January 29, 1999 and
its mortgage indebtedness was repaid, the Partnership has no exposure to
interest rate risk. In addition, the Partnership is expected to be
liquidated during 1999.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Incorporated by reference to the Partnership's Annual Report to Unitholders
for the fiscal year ended November 30, 1998, which is filed as an exhibit
under Item 14. Supplementary Data is incorporated by reference to F-1 and
F-2 of this report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Effective December 1, 1997, the Partnership advised PricewaterhouseCoopers
LLP (formerly Coopers & Lybrand L.L.P.) that it was changing accounting firms
and engaged KPMG LLP.
PricewaterhouseCoopers LLP's report on the consolidated financial statements
for the year ended November 30, 1996 contained no adverse opinion or
disclaimer of opinion and was not qualified as to uncertainty, audit scope or
accounting principles. There had been no disagreements with
PricewaterhouseCoopers LLP on any matters of accounting principles or
practices, financial statement disclosure, or auditing scope procedure.
The decision to change accountants was approved by CPS IV and RI 5, the
General Partners of the Partnership at that time.
Page 6
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP
The Partnership has no officers or directors. CPS IV, as the General Partner
of the Partnership, manages and controls the affairs of the Partnership and
has general responsibility and authority in all matters affecting its
business.
CPS IV is a California limited partnership organized on August 30, 1982. The
sole general partner of CPS IV is Continental American Development, Inc.
("ConAm Development"). The names and positions held by the directors and
executive officers of ConAm Development are set forth below. There are no
family relationships between any officers or directors.
NAME OFFICE
---- ------
Daniel J. Epstein President and Director
E. Scott Dupree Vice President and Director
Robert J. Svatos Vice President and Director
Ralph W. Tilley Vice President
J. Bradley Forrester Vice President
DANIEL J. EPSTEIN, 59, has been the President and a Director of ConAm
Development and a general partner of Continental American Properties, Ltd.
("ConAm"), an affiliate of CPS IV, since their inception. He is also
Chairman and Chief Executive Officer of ConAm Management. Prior to
organizing ConAm, Mr. Epstein was Vice President and a Director of American
Housing Guild, which he joined in 1969. At American Housing Guild, he was
responsible for the formation of the Multi-Family Division and directed its
development and property management activities. Mr. Epstein holds a Bachelor
of Science degree in Engineering from the University of Southern California.
E. SCOTT DUPREE, 48, is a Senior Vice President and general counsel of ConAm
Management responsible for negotiation, documentation, review and closing of
acquisition, sale and financing proposals. Mr. Dupree also acts as principal
legal advisor on general legal matters ranging from issues and contracts
involving the management company to supervision of litigation and employment
issues. Prior to joining ConAm Management in 1985, he was corporate counsel
to Trusthouse Forte, Inc., a major international hotel and restaurant
corporation. Mr. Dupree holds a B.A. from United States International
University and a Juris Doctorate degree from the University of San Diego.
ROBERT J. SVATOS, 40, is a Senior Vice President and is the Chief Financial
Officer of ConAm Management. His responsibilities include the accounting,
treasury and data processing functions of the organization. Prior to joining
ConAm Management in 1988, he was the Chief Financial Officer for AmeriStar
Financial Corporation, a nationwide mortgage banking firm. Mr. Svatos holds
an M.B.A. in Finance from the University of San Diego and a Bachelor's of
Science degree in Accounting from the University of Illinois. He is a
Certified Public Accountant.
RALPH W. TILLEY, 44, is a Senior Vice President and Treasurer of ConAm
Management. He is responsible for the financial aspects of syndications and
acquisitions, the company's asset management portfolio and risk management
activities. Prior to joining ConAm Management in 1980, he was a senior
accountant with KPMG LLP, specializing in real estate. He holds a Bachelor's
of Science degree in Accounting from San Diego State University and is a
Certified Public Accountant.
J. BRADLEY FORRESTER, 41, is the President of ConAm Management. He is
currently responsible for overseeing all aspects of the operations of the
firm. His primary focus is on new business related activities including
property acquisitions, property development and rehabilitation, and the
acquisition of other property management companies. Prior to joining ConAm,
Mr. Forrester served as Senior Vice President - Commercial Real Estate for
First Nationwide Bank in San Francisco, where he was responsible for a $2
billion problem asset portfolio including bank-owned real estate and
non-performing commercial real estate loans. His past experience includes
significant involvement in real estate development and finance, property
acquisitions and dispositions and owner's representation matters. Prior to
entering the real estate profession, he worked for KPMG LLP in Dallas, Texas.
Mr. Forrester holds a Bachelor of Science degree in Accounting from
Louisiana State University. He received his CPA certification in the State
of Texas.
Page 7
ITEM 11. EXECUTIVE COMPENSATION
Neither the General Partner nor any of its directors or executive officers
received any compensation from the Partnership. See Item 13 of this report
for a description of certain costs of the General Partner and its affiliates
reimbursed by the Partnership.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of November 30, 1998, no person was known by the Partnership to be the
beneficial owner of more than five percent of the Units of the Partnership.
Neither the General Partner nor any of its executive officers or directors
own any Units.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
CPS IV received $21,119 as the General Partner's allocable share of Net Cash
From Operations with respect to fiscal year ended November 30, 1998.
Pursuant to the Agreement of Limited Partnership of the Partnership, for the
fiscal year ended November 30, 1998, $13,036 of the Partnership's net income
was allocated to CPS IV. For a description of the share of Net Cash From
Operations and the allocation of income and loss to which the General Partner
is entitled, reference is made to Note 3 to the Consolidated Financial
Statements, included in the Partnership's Annual Report to Unitholders for
the fiscal year ended November 30, 1998, which is filed as an exhibit under
Item 14. Effective July 1, 1997, all General Partner allocations were made
solely to CPS IV.
The Partnership entered into property management agreements with ConAm
Management pursuant to which ConAm Management assumed direct responsibility
for day-to-day management of the Properties. It was the responsibility of
ConAm Management to select resident managers, where appropriate, and monitor
their performance. ConAm Management's services also included the
supervision of leasing, rent collection, maintenance, budgeting, employment
of personnel, payment of operating expenses, strategic asset management and
related services. For such services, ConAm Management was entitled to receive
a management fee equal to 5% of gross revenues. A summary of property
management fees earned by ConAm Management during the past three fiscal years
is incorporated by reference to Note 7 to the Consolidated Financial
Statements, included in the Partnership's Annual Report to Unitholders for
the fiscal year ended November 30, 1998, which is filed as an exhibit under
Item 14.
Pursuant to Section 12(g) of the Partnership's Agreement of Limited
Partnership, the General Partner may be reimbursed by the Partnership for
certain of its costs. A summary of amounts paid to the General Partners or
their affiliates during the past three fiscal years is incorporated by
reference to Note 7 to the Consolidated Financial Statements, included in the
Partnership's Annual Report to Unitholders for the fiscal year ended November
30, 1998, which is filed as an exhibit under Item 14.
Page 8
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULE AND REPORTS ON FORM 8-K
(a)(1) FINANCIAL STATEMENTS:
PAGE
----
Consolidated Balance Sheets - November 30, 1998 and 1997 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(1)
Consolidated Statements of Operations - For the years ended November 30, 1998, 1997 and 1996 .. . . . . . . . . . . .(1)
Consolidated Statements of Partners' Capital - For the years ended November 30, 1998, 1997 and 1996.. . . . . . . . .(1)
Consolidated Statements of Cash Flows - For the years ended November 30, 1998, 1997 and 1996 . . . . . . . . . . . .(1)
Notes to the Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(1)
Independent Auditors' Report .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(1)
Report of Former Independent Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(1)
(a)(2) FINANCIAL STATEMENT SCHEDULE:
Schedule III - Real Estate and Accumulated Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(F-1)
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(F-2)
Report of Former Independent Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .(F-3)
(1) INCORPORATED BY REFERENCE TO THE PARTNERSHIP'S ANNUAL REPORT TO
UNITHOLDERS FOR THE FISCAL YEAR ENDED NOVEMBER 30, 1998, FILED AS
AN EXHIBIT UNDER ITEM 14.
(a)(3) EXHIBITS:
(4)(A) Second Amended and Restated Agreement of Limited Partnership
(included as, and incorporated herein by reference to, Exhibit A to
the Prospectus of Registrant dated March 27, 1985, contained in
Amendment No. 1 to Registration Statement No. 2-95481 of
Registrant, dated March 27, 1985 (the "Registration Statement")).
(B) Subscription Agreement and Signature Page (included as, and
incorporated herein by reference to, Exhibit 3.1 to Amendment No.
1 to the Registration Statement).
(C) Amendment, dated January 18, 1999 to Partnership's Second Amended
and Restated Certificate and Agreement of Limited Partnership
(included as, and incorporated herein by reference to, Exhibit 4.1
to the Partnership's Report on Form 8-K filed on February 16,
1999).
(10)(A) Documents relating to Lakeview Village.
(A.1) Purchase and Development Agreement, dated January 31, 1984 and
exhibits thereto (included as, and incorporated herein by reference
to, Exhibit 10.2 to Amendment No. 1 to the Registration Statement).
(A.2) Amendments to Purchase and Development Agreement, dated May 31,
1985, July 31, 1985 and August 21, 1985 (included as, and
incorporated herein by reference to, Exhibit (10)(A) to the
Registrant's Annual Report on Form 10-K for the fiscal year ended
November 30, 1985 (the "1985 Annual Report")).
Page 9
(A.3) Amended and Restated Agreement of General Partnership of Lakeview
Village at Ponte Vedra Lakes Joint Venture, dated July 1, 1992
(included as, and incorporated herein by reference to Exhibit 10.2
to the Registrant's Quarterly Report on Form 10-Q for the quarter
ended August 31, 1992).
(A.4) Loan Documents: Promissory Note and Assignment of Rents and Leases
with respect to the refinancing of Lakeview Village, between
Registrant and The Penn Mutual Life Insurance Company (included as,
and incorporated herein by reference to, Exhibit A4 to the
Registrant's 1993 Annual Report on Form 10-K filed on March 30,
1994).
(A.5) Property Management Agreement between Lakeview Village at Ponte
Vedra Lakes Joint Venture and Con Am Management Corporation for the
Lakeview Village property (included as, and incorporated herein by
reference to, Exhibit A5 to the Registrant's 1993 Annual Report on
Form 10-K filed on March 30, 1994).
(A.6) Agreement for Purchase and Sale and Joint Escrow Instructions
between Lakeview Village at Ponte Vedra Lakes Joint Venture and DOC
Investors, L.L.C. dated January 26, 1999 with respect to Lakeview
Village Apartments (included as, and incorporated herein by
reference to, Exhibit 10.2 to the Partnership's Report on Form 8-K
filed on February 16, 1999).
(B) Documents relating to The Hamptons.
(B.1) Purchase and Development Agreement, dated October 9, 1984 and
exhibits thereto (included as, and incorporated herein by reference
to, Exhibit 10.3 to Amendment No. 1 to the Registration Statement).
(B.2) First Amendment to Purchase and Development Agreement, dated
December 12, 1985 (included as, and incorporated herein by
reference to, Exhibit (10)(B) to the Registrant's Annual Report on
Form 10-K for the fiscal year ended November 30, 1986).
(B.3) Real Estate Note, dated October 9, 1984 (filed as, and incorporated
herein by reference to Exhibit (10)(B) to the 1985 Annual Report).
(B.4) Property Management Agreement between The Hamptons Joint Venture
and ConAm Management Corporation for the Hamptons at Quail Hollow
II property (included as, and incorporated herein by reference to,
Exhibit B4 to the Registrant's 1993 Annual Report on Form 10-K
filed on March 30, 1994).
(B.5) Agreement for Purchase and Sale and Joint Escrow Instructions
between The Hamptons Joint Venture and Lend Lease Real Estate
Investments, Inc. dated December 15, 1998, and amendment thereto
and assignment thereof, with respect to Hamptons at Quail Hollow
Apartments (included as, and incorporated herein by reference to,
Exhibit 10.1 to the Partnership's Report on Form 8-K filed on
February 16, 1999).
(C) Documents relating to Canterbury Park:
(C.1) Purchase and Development Agreement, dated September 7, 1984
(included as, and incorporated herein by reference to, Exhibit 10.4
to Amendment No. 1 to the Registration Statement).
(C.2) Amendments to Purchase and Development Agreement, dated April 30,
1985 and June 30, 1985 (included as, and incorporated herein by
reference to, Exhibit (10)(C) to the 1985 Annual Report).
(C.3) Property Management Agreement between Hutton/ConAm Realty Investors
5 and Con Am Management Corporation for the Canterbury Park II
property (included as, and incorporated herein by reference to,
Exhibit C3 to the Registrant's 1993 Annual Report on Form 10-K
filed on March 30, 1994).
(D) Settlement Agreement by and among the Managing Joint Venturers and
the Epoch Joint Venturers, dated July 1, 1992, (included as, and
incorporated herein by reference to, Exhibit 10.1 to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended
August 31, 1992).
Page 10
(13) Annual Report to Unitholders for the fiscal year ended November 30,
1998.
(21) List of Subsidiaries - Joint Ventures (included as, and
incorporated herein by reference to, Exhibit (22) to the
Registrant's Annual Report on Form 10-K filed for the fiscal year
ended November 30, 1991).
(27) Financial Data Schedule
(99) Portions of the Prospectus of the Registrant, dated March 27, 1985
(included as, and incorporated herein by reference to, Exhibit 28
to the Registrant's 1987 Annual Report on Form 10-K filed for the
fiscal year ended November 30, 1987).
(b) REPORTS ON FORM 8-K:
No reports on Form 8-K were filed by the Partnership during the
fourth quarter of the fiscal year ended November 30, 1998.
(c) EXHIBITS
See Item 14(a)(3) above.
Page 11
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Dated: February 28, 1999
BY: ConAm Property Services IV, Ltd.
General Partner
BY: Continental American Development, Inc.
General Partner
BY: /s/ Daniel J. Epstein
------------------------------
Name: Daniel J. Epstein
Title: President, Director and
Principal Executive Officer
Page 12
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.
CONAM PROPERTY SERVICES IV, LTD.
A General Partner
By: Continental American Development, Inc.
General Partner
Date: February 28, 1999
BY: /s/ Daniel J. Epstein
--------------------------------------
Daniel J. Epstein
Director, President and
Principal Executive Officer
Date: February 28, 1999 BY: /s/ E. Scott Dupree
--------------------------------------
E. Scott Dupree
Vice President and Director
Date: February 28, 1999
BY: /s/ Robert J. Svatos
--------------------------------------
Robert J. Svatos
Vice President and Director
Date: February 28, 1999
BY: /s/ Ralph W. Tilley
--------------------------------------
Ralph W. Tilley
Vice President
Date: February 28, 1999
BY: /s/ J. Bradley Forrester
--------------------------------------
J. Bradley Forrester
Vice President
Page 13