UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 2004
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( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
Commission File Number 0-13331
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
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(Exact Name of Registrant as specified in its Charter)
Delaware 16-1234990
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(State of Formation) (IRS Employer Identification No.)
2350 North Forest Road
Getzville, New York 14068
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(Address of Principal Executive Office)
Registrant's Telephone Number: (716) 636-9090
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
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 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 [ ]
Indicate by a 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]
Indicate by a check mark whether the registrant is an accelerated file (as
defined in Rule 12b-2 of the Act). Yes [ ] No [X]
DOCUMENTS INCORPORATED BY REFERENCE
See Item 15 for a list of all documents incorporated by reference
PART I
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ITEM 1: BUSINESS
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The Registrant, Realmark Property Investors Limited Partnership-III
(the "Partnership"), is a Delaware Limited Partnership organized in 1983,
pursuant to a Second Amended and Restated Agreement and Certificate of Limited
Partnership (the "Partnership Agreement"), under the Delaware Revised Uniform
Limited Partnership Act. The Partnership's general partners are Realmark
Properties, Inc. (the "Corporate General Partner"), a Delaware corporation, and
Joseph M. Jayson (the "Individual General Partner").
The Registrant commenced the public offering of its limited partnership
units, registered with the Securities and Exchange Commission under the
Securities Act of 1933 as amended on February 1, 1984, and concluded the
offering on January 31, 1985, having raised a total of $15,551,000 before
deducting sales commissions and expenses of the offering.
The Partnership's primary business and its only industry segment is to
own and operate income-producing real property for the benefit of its partners.
At December 31, 2004, the Partnership has disposed of its last two properties.
On April 5, 2004, the Partnership sold Inducon Amherst for $2,045,000 resulting
in a net gain of approximately $20,000. On May 20, 2004, the partnership
disposed of its last property, Perrymont, for $2,450,000, less a $600,000 credit
for work which the buyer determined was necessary on the property, resulting in
a gain of approximately $145,000. Accordingly, the Partnership is in the process
of liquidating.
The business of the Partnership is not seasonal. As of December 31,
2004, the Partnership did not directly employ any persons in a full-time
position. All persons who regularly rendered services on behalf of the
Partnership through December 31, 2004 were employees of the Corporate General
Partner or its affiliates.
This annual report contains certain forward-looking statements
concerning the Partnership's current expectations as to future results. Words
such as "believes", "forecasts", "intends", "possible", "expects", "estimates",
"anticipates" or "plans" and similar expressions are intended to identify
forward-looking statements. Such statements may not ultimately turn out to be
accurate due to, among other things, economic or market conditions or the
failure of the Partnership to sell an investment which is under contract.
ITEM 2: PROPERTIES
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As of December 31, 2004, the Partnership did not own any property
investments
ITEM 3: LEGAL PROCEEDINGS
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As previously reported, the Partnership, as a nominal defendant, the
general partners of the Partnership and of affiliated public partnerships, (the
"Realmark Partnerships") and the officers and directors of the Corporate General
Partner, as defendants, had been involved in a class action litigation at the
state court level regarding the payment of fees and other management issues.
On August 29, 2001, the parties entered into a Stipulation of
Settlement (the "Settlement"). On October 4, 2001, the Court issued an "Order
Preliminary
2
Approving Settlement" (the "Hearing Order") and on November 29, 2001, the Court
issued an "Order and Final Judgment Approving Settlement and Awarding Fees and
Expenses" and dismissing the complaints with prejudice. The Settlement provided,
among other things, that all of the Realmark Partnerships' properties be
disposed of. The general partners will continue to have primary authority to
dispose of the Partnerships' properties. If either (i) the general partners have
not sold or contracted to sell 50% of the Partnerships' properties (by value) by
April 2, 2002 or (ii) the general partners have not sold or contracted to sell
100% of the Partnerships' properties by September 29, 2002, then the primary
authority to dispose of the Partnerships' properties will pass to a sales agent
designated by plaintiffs' counsel and approved by the Court. On October 4, 2002,
the Court appointed a sales agent to work with the general partners to continue
to sell the Partnership's remaining properties.
The settlement also provided for the payment by the Partnerships of
fees to the plaintiffs' attorneys. These payments, which are not calculable at
this time but may be significant, are payable out of the proceeds from the sale
of all of the properties owned by all of the Realmark Partnerships, following
the sale of the last of these properties in each partnership. Plaintiffs'
counsel will receive 15% of the amount by which the sales proceeds distributable
to limited partners in each partnership exceeds the value of the limited
partnership units in each partnership (based on the weighted average of the
units' trading prices on the secondary market as reported by Partnership
Spectrum for the period May through June 2001). In no event may the increase on
which the fees are calculated exceed 100% of the market value of the units as
calculated above. On May 20, 2004 the Partnership sold its remaining property,
and in December 2004, a payment of $404,501 was made to the plaintiffs'
attorneys.
ITEM 4: SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS
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None.
PART II
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ITEM 5: MARKET FOR REGISTRANT'S UNITS OF LIMITED PARTNERSHIP INTEREST
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There is currently no active trading market for the units of limited
partnership interest of the Partnership and it is not anticipated that any will
develop in the future. Accordingly, information as to the market value of a unit
at any given date is not available. As of December 31, 2004, there were 1,736
record holders of units of limited partnership interest. In December 2004, the
Partnership made distributions of its previously undistributed net cash from
sales proceeds. These distributions were made in accordance with the settlement
of the lawsuit (Item 3). A total of $1,525,136 was distributed on behalf of the
limited partners. Of this amount, $404,501 was paid to legal counsel in
accordance with the settlement of the lawsuit and $1,120,635 was distributed
directly to record holders of units of limited partnership interest.
3
ITEM 6: SELECTED FINANCIAL DATA
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At or for the years ended December 31,
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2004 (1) 2003 2002 2001 2000
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BALANCE SHEET DATA
Net rental property $ - 3,505,259 3,469,684 3,338,033 6,479,500
Total assets 192,941 3,751,314 3,891,673 4,157,186 7,706,941
Mortgage loans payable - 1,703,787 1,736,328 1,766,156 4,874,473
Partners' equity - 1,801,045 2,013,598 2,313,563 2,512,045
=====================================================================================
OPERATING DATA
Rental income 186,495 601,259 570,246 2,028,916 2,474,400
Other income 50,990 187,936 179,631 341,396 339,438
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Total revenue 237,485 789,195 749,877 2,370,312 2,813,838
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Property operating costs 265,108 598,898 622,956 1,656,992 1,797,539
Depreciation - - - - 465,454
Interest expense 26,848 166,442 168,155 406,070 456,940
Administrative expenses 267,337 236,408 258,731 528,549 515,509
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Total expenses 559,293 1,001,748 1,049,842 2,591,611 3,235,442
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Operating loss (321,808) (212,553) (299,965) (221,299) (421,604)
Gain on property sales 164,286 - - 5,022,817 -
Extraordinary loss (404,501) - - - -
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Net income (loss) (562,023) (212,553) (299,965) 4,801,518 (421,604)
=====================================================================================
CASH FLOW DATA
Net cash provided (used) by:
Operating activities (201,677) (29,409) (9,619) (224,082) 77,607
Investing activities 3,593,248 (50,768) (116,458) 8,031,721 (113,574)
Financing activities (3,228,923) (32,541) (29,828) (8,108,317) (444,413)
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Net increase (decrease) in
cash and equivalents $ 162,648 (112,718) (155,905) (300,678) (480,380)
=====================================================================================
PER LIMITED PARTNERSHIP UNIT:
Net income (loss) $ (9.51) (13.26) (18.71) 309.19 (26.30)
Distributions $ 98.07 - - 321.52 23.89
=====================================================================================
(1) The Partnership began reporting on the liquidation basis of accounting
effective May 21, 2004. Therefore, operations for the year ended December 31,
2004 are reported on the consolidated statement of changes in net assets in
liquidation for the period from May 21, 2004 to December 31, 2004, while
operations from the period from January 1, 2004 to May 20, 2004 and for the
years ended December 31, 2003, 2002, 2001, and 2000 are reported on the going
concern basis in the consolidated statements of operations. Balance sheet data
at December 31, 2004 represents the total assets and net assets in liquidation
as reported in the consolidated statement of net assets in liquidation
(liquidation basis) at December 31, 2004 (page F-2).
ITEM 7: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
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OF OPERATIONS
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Liquidity and Capital Resources:
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Effective January 1, 2001, management began formally marketing all
properties in the Partnership for sale. On April 5, 2004, the Partnership sold
4
Inducon Amherst to an unaffiliated entity for cash of $2,045,000. After
satisfaction of the $1,704,000 mortgage loan on the property and payment of
closing costs, the net cash proceeds available amounted to $425,000, before
satisfaction of any remaining obligations related to the property. Additionally,
on May 20, 2004, the Partnership's only remaining property, Perrymont, was sold
to an unaffiliated entity for cash of $2,450,000, less a $600,000 credit for
work which the buyer determined was necessary on the property. After
satisfaction of closing costs, the net cash proceeds available amounted to
approximately $1,658,000, before satisfaction of any remaining obligations
related to the property. These proceeds enabled the partnership to make a
distribution in December 2004 of $1,120,635 after a payment of $404,501 to the
plaintiff's counsel in accordance with the settlement of the lawsuit (Item 3).
The Partnership made no distributions to limited partners in 2003 and 2002. The
remaining proceeds, net of those amounts that are required to pay the estimated
payables and costs of operating the partnership during liquidation, will be
distributed to the limited partners.
Limited partners should be aware that it is possible that they will
receive an allocation of income from gain on sale of properties on which they
will be required to pay income taxes and there is no assurance that
distributions from the sale of the properties will be sufficient to satisfy
these obligations.
Except as described above and in the consolidated financial statements,
the general partner is not aware of any trends or events, commitments or
uncertainties that may impact liquidity in a material way.
Results of Operations:
- ----------------------
As a result of the sale of the remaining property, Perrymont, and the
establishment of a plan of liquidation, the Partnership began operating on the
liquidation basis of accounting effective May 21, 2004. Therefore, operations
for the period May 21, 2004 to December 31, 2004 are reported in the
consolidated statement of changes in net assets in liquidation while the
operations for the period January 1, 2004 to May 20, 2004 and for the years
ended December 31, 2003 and 2002 are reported on the going concern basis in the
consolidated statements of operations.
Inflation has been consistently low during the periods presented in the
consolidated financial statements and, as a result, has not had a significant
effect on the operations of the Partnership or its properties.
2004 as compared to 2003
- ------------------------
As discussed above, the Partnership began reporting on a liquidation
basis of accounting on May 21, 2004. The decrease in most components of the
consolidated statements of operations for the period January 1, 2004 to May 20,
2004 was a result of the two remaining properties, Inducon Amherst and
Perrymont, being sold on April 5, 2004 and May 20, 2004, respectively, and
rental operations ceasing at that time. There were no individually significant
factors which caused changes in revenues and expenses as of May 20, 2004 when
compared to the year ended December 31, 2003 other than the sale of Inducon
Amherst and Perrymont.
2003 as compared to 2002
- ------------------------
Rental income at Perrymont increased approximately $34,000 for the year
ended December 31, 2003 as occupancy remained at 66% throughout the year. Rental
5
income at Inducon Amherst decreased approximately $3,000 for the year ended
December 31, 2003 as occupancy decreased to 58% from 61% for the year ended
December 31, 2002. The net change in rental income was an increase of
approximately $31,000. The increase in rental income along with an increase in
other income of approximately $8,000, primarily common area maintenance fees at
the property level, produced a 5% increase in total income for the year ended
December 31, 2003.
Total expenses for the year ended December 31, 2003 decreased
approximately $48,000 as compared to 2002. The decrease in property operations
of $24,000, the decrease in administrative expense and reimbursement to
affiliates of $29,000, and the decrease in interest expense of $2,000 was offset
by a $7,000 increase in other administrative expense. The decrease in property
operations was attributable to a decrease in leasing fees and a reduction of
expenditures for exterior painting at Inducon Amherst. The decrease in
administrative expense to affiliates was a result of a decrease in management
fees and portfolio reimbursed expenses. Interest expense decreased due to a
larger portion of each mortgage payment being applied towards principal due to
amortization of the mortgage at Inducon Amherst. The increase in other
administrative expense was due to increased legal and professional services.
ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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The Partnership invests only in short term money market instruments, in
amounts in excess of daily working cash requirements. The rates of earnings on
those investments increase or decrease in line with the general movement of
interest rates. The mortgage loan on the Partnership's property is fixed rate
and therefore, is not subject to market risk.
ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
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Listed under Item 15 of this report.
ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
- ------- ---------------------------------------------------------------
FINANCIAL DISCLOSURE
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None.
ITEM 9A: CONTROLS AND PROCEDURES
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The Partnership maintains a set of disclosure controls and procedures
designed to ensure that information required to be disclosed by the Partnership
in reports that it files or submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in
Securities and Exchange Commission rules and forms. Within the 90-day period
prior to the filing of this report, an evaluation was carried out under the
supervision and with the participation of the Partnership's management,
including the Partnership's Individual General Partner and Principal Financial
Officer, of the effectiveness of the Partnership's disclosure controls and
procedures. Based on that evaluation, the Partnership's Individual General
Partner and Principal Financial Officer concluded that the Partnership's
disclosure controls and procedures are effective.
Subsequent to the date of their most recent evaluation, there have been
no significant changes in the Partnership's internal control over financial
reporting or in other factors that could significantly affect the internal
control over financial reporting.
6
PART III
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ITEM 10: DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
- -------- --------------------------------------------------
The Partnership, as an entity, does not have any directors or officers.
The Individual General Partner of the Partnership is Joseph M. Jayson. The
directors and executive officers of Realmark Properties, Inc., the Partnership's
Corporate General Partner, as of December 31, 2004, are listed below. Each
director is subject to election on an annual basis.
Title of All Positions Held with
Name the Corporate General Partner Year First Elected to Position
- ---- ----------------------------- ------------------------------
Joseph M. Jayson Chairman of the Board, President 1979
and Treasurer
Judith P. Jayson Vice President and Director 1979
Joseph M. Jayson and Judith P. Jayson are married to each other.
The Directors and Executive Officers of the Corporate General Partner
and their principal occupations and affiliations during the last five years or
more are as follows:
Joseph M. Jayson, age 66, is Chairman, Director and sole stockholder of
J. M. Jayson and Company, Inc. and certain of its affiliated companies: U.S.
Apartments LLC, Westmoreland Capital Corporation, Oilmark Corporation and U.S.
Energy Development Corporation. In addition, Mr. Jayson is Chairman of Realmark
Corporation, Chairman, President and Treasurer of Realmark Properties, Inc.,
wholly-owned subsidiaries of J. M. Jayson and Company, Inc. and co-general
partner of Realmark Property Investors Limited Partnership, Realmark Property
Investors Limited Partnership-II, Realmark Property Investors Limited
Partnership-III, Realmark Property Investors Limited Partnership-IV, Realmark
Property Investors Limited Partnership-V, Realmark Property Investors Limited
Partnership-VI A, and Realmark Property Investors Limited Partnership-VI B. Mr.
Jayson has been in the real estate business for the last 42 years and is a
Certified Property Manager as designated by the Institute of Real Estate
Management ("I.R.E.M."). Mr. Jayson received a B.S. Degree in Education in 1961
from Indiana University, a Masters Degree from the University of Buffalo in
1963, and has served on the educational faculty of the Institute of Real Estate
Management. Mr. Jayson has for the last 42 years been engaged in various aspects
of real estate brokerage and investment. He brokered residential properties from
1962 to 1964, commercial investment properties from 1964 to 1967, and in 1967
left commercial real estate to form his own investment firm. Since that time,
Mr. Jayson and J. M. Jayson & Company, Inc. have formed or participated in
various ways with forming over 30 real estate related limited partnerships. For
the past 23 years, Mr. Jayson and an affiliate have also engaged in
developmental drilling for gas and oil.
Judith P. Jayson, age 64, is currently Vice President and a Director of
Realmark Properties, Inc. She is also a Director of the property management
affiliate, Realmark Corporation. Mrs. Jayson has been involved in property
management for the last 33 years and has extensive experience in the hiring and
training of property management personnel and in directing, developing and
implementing property management systems and programs. Mrs. Jayson, prior to
joining the firm in 1973, taught business in the Buffalo, New York High School
System. Mrs. Jayson graduated from St. Mary of the Woods College in Terre Haute,
Indiana, with a degree in Business Administration.
7
Audit Committee
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The Partnership has a separately-designated standing audit committee
established in accordance with Section 3(a)(58)(A) of the Exchange Act. The
members of the audit committee are Joseph M. Jayson and Bryant E. Zilke.
Audit Committee Financial Expert
- --------------------------------
The Directors and Executive Officers of the Corporate General Partner
have determined that Bryant E. Zilke is an audit committee financial expert as
defined by Item 401(h) of Regulation S-K of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"). Mr. Zilke is not independent within the meaning
of Item 7(d)(3)(iv) of Schedule 14A of the Exchange Act due to limited
circumstances - namely that the Partnership is small in size and there is
limited personnel. Mr. Zilke is not independent as a result of being an employee
of an affiliate of the Corporate General Partner.
Code of Ethics
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The Partnership has adopted a code of ethics for the partners,
principal financial officer, and employees of the Corporate General Partner or
its affiliates who render services on behalf of the Partnership. The Partnership
will provide to any person without charge, upon request, a copy of the code of
ethics which is available from:
Realmark Property Investors Limited Partnership - III
Attention: Investor Relations
2350 North Forest Road
Getzville, New York 14068
ITEM 11: EXECUTIVE COMPENSATION
- -------- ----------------------
No direct remuneration was paid or payable by the Partnership to
directors and officers (since it has no directors or officers), nor was any
direct remuneration paid or payable by the Partnership to directors or officers
of Realmark Properties, Inc., the Corporate General Partner and sponsor, for the
year ended December 31, 2004. The Corporate General Partner and its affiliate,
Realmark Corporation, are entitled to fees and to certain expense reimbursements
with respect to Partnership operations, as set forth in Item 13 hereof and in
the notes to the consolidated financial statements.
ITEM 12: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
- -------- --------------------------------------------------------------
No person is known to the Partnership to own of record or beneficially,
more than 5% of the units of limited partnership interests of the Partnership,
except for affiliates of the general partners that own 1111.9 units of limited
partnership interest amounting to approximately 7.2% of the partnership interest
at December 31, 2004. The general partners and the executive officers of the
Corporate General Partner, as of December 31, 2004, owned 25.5 units of limited
partnership interest. The general partners and affiliates will receive their
proportionate share, as limited partners, of any distributable proceeds from the
sale of the properties.
8
ITEM 13: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- -------- ----------------------------------------------
The properties of the Partnership and its subsidiary are managed by
Realmark Corporation, an affiliate of the Partnership's corporate general
partner, for a fee of generally 5% of annual net rental income of the
properties. Realmark Corporation and the Corporate General Partner are also
reimbursed for disbursements made on behalf of the Partnership. Those
transactions are further described, and quantified, in the note to the
consolidated financial statements entitled "Related Party Transactions."
ITEM 14: PRINCIPAL ACCOUNTING FEES AND SERVICES
- -------- --------------------------------------
Audit Engagement: Toski, Schaefer & Co., P.C. was engaged as the Partnership's
independent auditor for years 2004 and 2003. All fees incurred for the years
ended December 31, 2004 and 2003 were approved by the Audit Committee.
Audit Fees: Audit fees for the audit of the Partnership's annual financial
statements included in the Partnership's annual report on Form 10-K and those
financial statements included in the Partnership's quarterly reports on Form
10-Q by Toski, Schaefer & Co., P.C. for the years ended December 31, 2004 and
2003 totaled $31,500 and $28,150, respectively.
Audit-Related Fees: None.
Tax Fees: The Partnership engaged Toski, Schaefer & Co., P.C. to provide tax
filing and compliance services during the years ended December 31, 2004 and 2003
The fees for these services amounted to $4,935 and $4,104, respectively.
All Other Fees: None.
The Audit Committee has set a policy that all fees incurred by the
Partnership for services performed by its independent auditors must be
pre-approved by the Audit Committee. All fees related to 2004 and 2003 were
pre-approved by the Audit Committee.
The Audit Committee oversees the Partnership's financial reporting
process. Management has the primary responsibility for the financial statements
and the financial reporting process, including the systems of internal controls.
In fulfilling its oversight responsibilities, the Audit Committee reviewed the
audited financial statements with management, including a discussion of the
quality, not just the acceptability, of the accounting principles, the
reasonableness of significant judgments and the clarity of disclosures in the
financial statements.
The Audit Committee has the sole authority to retain and terminate the
Partnership's independent auditors and approves all fees paid to the independent
auditors. During 2004 and 2003, the Audit Committee reviewed with the
independent auditors, who are responsible for expressing an opinion on the
conformity of those audited financial statements with generally accepted
accounting principles, their judgments as to the quality, not just the
acceptability, of the Partnership's accounting principles and such other matters
as are required to be discussed with the Audit Committee under generally
accepted auditing standards. In addition, the Audit Committee has discussed with
the independent auditors the auditors' independence from management and the
Partnership, including the matters in the written disclosures required by the
Independence Standards Board, and considered the scope and type of non-audit
services provided by the auditor when reviewing the compatibility of those
non-audit services with the auditors' independence.
9
The Audit Committee discussed with the Partnership's independent
auditors the overall scope and plans for their audit. The Audit Committee meets
with the independent auditors to discuss the results of their examination, their
evaluations of the Partnership's internal controls, and the overall quality of
the Partnership's financial reporting.
In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the General Partners (and the General Partners have
approved) that the audited financial statements be included in the annual report
on Form 10-K for the year ended December 31, 2004.
PART IV
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ITEM 15: EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES, AND REPORTS ON FORM 8-K
- -------- ------------------------------------------------------------------
(a) Consolidated Financial Statements Page
--------------------------------- ----
Independent Auditor's Report F-1
Consolidated Statement of Net Assets in Liquidation as of December 31, 2004 F-2
Consolidated Statement of Changes in Net Assets in Liquidation for
the period May 21, 2004 to December 31, 2004 F-3
Consolidated Balance Sheet as of December 31, 2003 F-4
Consolidated Statements of Operations for the period January 1, 2004
to May 20, 2004 and for the years ended December 31, 2003 and 2002 F-5
Consolidated Statements of Partners' Equity for the period January 1, 2004
to May 20, 2004 and for the years ended December 31, 2003 and 2002 F-6
Consolidated Statements of Cash Flows for the period January 1, 2004
to May 20, 2004 and for the years ended December 31, 2003 and 2002 F-7
Notes to Consolidated Financial Statements F-8
FINANCIAL STATEMENT SCHEDULE
----------------------------
(i) Schedule III - Real Estate and Accumulated Depreciation F-15
All other schedules are omitted because they are not applicable or the
required information is shown in the consolidated financial statements
or the notes thereto.
(b) Reports on Form 8-K
-------------------
None.
10
(c) Exhibits
--------
2. Plan of acquisition, reorganization, arrangement, liquidation, or
succession
(a) Stipulation of Settlement Agreement dated August 29, 2001 is
incorporated herein by reference.
(b) Order and Final Judgment Approving Settlement and Awarding
Fees and Expenses dated November 29, 2001 is incorporated
herein by reference.
4. Instruments defining the rights of security holder, including
indentures
(a) Second Amended and Restated Agreement and Certificate of
Limited Partnership filed with the Registration Statement of
the Registrant Form S-11, filed November 21, 1983, and
subsequently amended is incorporated herein by reference.
10. Material contracts
(a) Property Management Agreement with Realmark Corporation
included with the Registration Statement of the Registrant as
filed and amended to date is incorporated herein by
reference.
14. Code of Ethics filed December 31, 2003, is incorporated herein by
reference.
21. Subsidiary of the Partnership is filed herewith.
31. Certification Pursuant to Rule 13a-14(a), as Adopted Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002, is filed herewith.
32. Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, is
filed herewith.
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.
REALMARK PROPERTY INVESTORS
LIMITED PARTNERSHIP - III
By: /s/Joseph M. Jayson March 31, 2005
---------------------------------------- --------------------
JOSEPH M. JAYSON, Date
Individual General Partner
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 and in the capacities and on the dates indicated.
By: REALMARK PROPERTIES, INC.
Corporate General Partner
/s/ Joseph M. Jayson March 31, 2005
---------------------------------------- --------------------
JOSEPH M. JAYSON, Date
President, Treasurer and Director
/s/ Judith P. Jayson March 31, 2005
---------------------------------------- --------------------
JUDITH P. JAYSON, Date
Vice President and Director
12
INDEPENDENT AUDITOR'S REPORT
----------------------------
The Partners
Realmark Property Investors Limited
Partnership - III:
We have audited the accompanying consolidated balance sheet of Realmark Property
Investors Limited Partnership - III and Subsidiary as of December 31, 2003 and
the related consolidated statements of operations, partners' equity, and cash
flows for each of the two years in the period ended December 31, 2003, and for
the period January 1, 2004 to May 20, 2004. In addition we have audited the
consolidated statement of net assets in liquidation as of December 31, 2004 and
the related consolidated statement of changes in net assets in liquidation for
the period May 21, 2004 to December 31, 2004. Our audits also included the
financial statement schedule listed in the index at Item 15. These consolidated
financial statements and the financial statement schedule are the responsibility
of the General Partners. Our responsibility is to express an opinion on the
consolidated financial statements and the financial statement schedule based on
our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Partnership is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances but not for the purpose of expressing an
opinion on the effectiveness of the Partnership's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As discussed in note 1 to the consolidated financial statements, on May 20, 2004
the Partnership adopted a plan of termination and liquidation. As a result, the
Partnership has changed its basis of accounting from the going concern to the
liquidation basis effective May 21, 2004.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Realmark Property
Investors Limited Partnership - III and Subsidiary as of December 31, 2003, and
the results of their operations and their cash flows for each of the two years
in the period ended December 31, 2003, and for the period January 1, 2004 to May
20, 2004, and their net assets in liquidation as of December 31, 2004 and their
related changes in net assets in liquidation for the period May 21, 2004 to
December 31, 2004 in conformity with accounting principles generally accepted in
the United States of America. Also, in our opinion, the financial statement
schedule, when considered in relation to the basic financial statements taken as
a whole, presents fairly in all material respects the information set forth
therein.
/s/ TOSKI, SCHAEFER & CO., P.C.
-------------------------------
TOSKI, SCHAEFER & CO., P.C.
Williamsville, New York
March 29, 2005
F-1
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Consolidated Statement of Net Assets in Liquidation
(Liquidation Basis)
December 31, 2004
Assets - cash $ 192,941
-----------
Liabilities:
Accounts payable and accrued expenses 62,777
Payable to affiliated parties 11,777
Estimated costs during the period of liquidation 118,387
-----------
Total liabilities 192,941
-----------
Net assets in liquidation $ -
===========
See accompanying notes to consolidated financial statements.
F-2
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Consolidated Statement of Changes in Net Assets in Liquidation
(Liquidation Basis)
For the period May 21, 2004 to December 31, 2004
Partners' equity at May 21, 2004 (going concern basis) $ 1,727,195
Adjustment to Liquidation Basis - loss on settlement of lawsuit (404,501)
----------------
Net assets in liquidation at May 21, 2004 1,322,694
Estimated costs during the period of liquidation (202,059)
Distributions to limited partners (1,120,635)
---------------
Net assets in liquidation at December 31, 2004 $ -
===============
See accompanying notes to consolidated financial statements.
F-3
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Consolidated Balance Sheet
December 31, 2003
Assets 2003
------ -----------
Property and equipment, at cost, all held for sale:
Land $ 277,709
Buildings and improvements 6,229,616
Furniture and equipment 77,271
-----------
6,584,596
Less accumulated depreciation 3,079,337
-----------
Net property and equipment 3,505,259
Cash and equivalents 30,293
Accounts receivable, net of allowance for doubtful accounts
of $18,000 in 2003 4,148
Escrow deposits 150,315
Other assets 61,299
-----------
Total assets $ 3,751,314
===========
Liabilities and Partners' Equity
--------------------------------
Liabilities:
Mortgage loan payable 1,703,787
Accounts payable and accrued expenses 172,552
Payable to affiliated parties 7,311
Accrued interest payable 12,647
Security deposits and prepaid rents 53,972
-----------
Total liabilities 1,950,269
-----------
Partners' equity (deficit):
General partners (102,108)
Limited partners 1,903,153
-----------
Total partners' equity 1,801,045
-----------
Total liabilities and partners' equity $ 3,751,314
===========
See accompanying notes to consolidated financial statements.
F-4
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Consolidated Statements of Operations
Period January 1, 2004 to May 20, 2004 and
Years ended December 31, 2003 and 2002
2004 2003 2002
---- ---- ----
Income:
Rental $ 177,762 601,259 570,246
Interest and other 51,208 187,936 179,631
---------- ---------- ----------
Total income 228,970 789,195 749,877
---------- ---------- ----------
Expenses:
Property operations 252,274 598,898 622,956
Interest 26,044 166,442 168,155
Administrative:
Affiliated parties 114,866 126,322 155,288
Other 73,922 110,086 103,443
---------- ---------- ----------
Total expenses 467,106 1,001,748 1,049,842
---------- ---------- ----------
Loss before gain on sale of property (238,136) (212,553) (299,965)
Gain on sale of properties 164,286 -- --
---------- ---------- ----------
Net loss $ (73,850) (212,553) (299,965)
========== ========== ==========
Net loss per limited partnership unit $ (4.29) (13.26) (18.71)
========== ========== ==========
Weighted average number of limited partnership
units outstanding 15,551 15,551 15,551
========== ========== ==========
See accompanying notes to consolidated financial statements.
F-5
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Consolidated Statements of Partners' Equity
Period January 1, 2004 to May 20, 2004 and
Years ended December 31, 2003 and 2002
Limited Partners
General ----------------
Partners Units Amount
---------- ---------- ----------
Balances at December 31, 2001 $ (86,732) 15,551 2,400,295
Net loss (8,999) -- (290,966)
---------- ---------- ----------
Balances at December 31, 2002 (95,731) 15,551 2,109,329
Net loss (6,377) -- (206,176)
---------- ---------- ----------
Balances at December 31, 2003 (102,108) 15,551 1,903,153
Net loss (7,144) -- (66,706)
---------- ---------- ----------
Balance at May 20, 2004 $ (109,252) 15,551 1,836,447
========== ========== ==========
See accompanying notes to consolidated financial statements.
F-6
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Consolidated Statements of Cash Flows
Period January 1, 2004 to May 20, 2004 and
Years ended December 31, 2003 and 2002
2004 2003 2002
---- ---- ----
Cash flows from operating activities:
Net loss $ (73,850) (212,552) (299,965)
Adjustments to reconcile net loss to net
cash used in operating activities:
Amortization 25,607 24,239 22,636
Gain on sale of properties (164,286) -- --
Changes in:
Accounts receivable (5,852) (210) 33,494
Receivables from affiliated parties -- 1,020 57,285
Escrow deposits 150,315 19,577 150,327
Other assets 35,692 18,590 (22,483)
Accounts payable and accrued expenses 71,102 118,861 11,878
Payable to affiliated parties 19,820 7,311 --
Accrued interest payable (12,647) (241) (222)
Security deposits and prepaid rents (53,972) (6,003) 37,431
----------- ----------- -----------
Net cash used in operating activities (8,071) (29,409) (9,619)
----------- ----------- -----------
Cash flows from investing activities:
Proceeds from sale of property 3,593,248 -- --
Additions to property and equipment -- (50,768) (116,458)
----------- ----------- -----------
Net cash provided by (used in)
investing activities 3,593,248 (50,768) (116,458)
----------- ----------- -----------
Cash flows from financing activities -
principal payments on mortgage loans (1,703,787) (32,541) (29,828)
----------- ----------- -----------
Net increase (decrease) in cash and equivalents 1,881,390 (112,718) (155,905)
Cash and equivalents at beginning of period 30,293 143,011 298,916
----------- ----------- -----------
Cash and equivalents at end of period $ 1,911,683 30,293 143,011
=========== =========== ===========
Supplemental disclosure of cash flow information:
Cash paid for interest $ 24,454 150,458 153,172
=========== =========== ===========
Property and equipment financed by
accounts payable $ -- -- 15,193
=========== =========== ===========
See accompanying notes to consolidated financial statements.
F-7
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Notes to Consolidated Financial Statements
December 31, 2004, 2003 and 2002
(1) Liquidation of the Partnership
- ----------------------------------
On May 20, 2004, the Partnership sold its remaining property investment,
Perrymont, and adopted a plan of termination and liquidation under which
obligations to non-affiliates will be paid and net proceeds will be
distributed to the limited partners.
(2) Formation and Operation of Partnership
- ------------------------------------------
Realmark Property Investors Limited Partnership - III (the Partnership) is
a Delaware limited partnership formed on November 18, 1983, to invest in a
diversified portfolio of income-producing real estate investments.
In 1984 and 1985, the Partnership sold through a public offering, 15,551
units of limited partnership interest for $15,551,000. The general partners
are Realmark Properties, Inc. (the Corporate General Partner) and Joseph M.
Jayson (the Individual General Partner) who is the sole shareholder of J.M.
Jayson & Company, Inc. Realmark Properties, Inc. is a wholly-owned
subsidiary of J.M. Jayson & Company, Inc.
Under the partnership agreement, the general partners and their affiliates
can receive compensation for services rendered and reimbursement for
expenses incurred on behalf of the Partnership (note 7).
(3) Summary of Significant Accounting Policies
- ----------------------------------------------
(a) Basis of Accounting and Consolidation
-------------------------------------
As a result of the plan of termination and liquidation, the Partnership
changed its basis of accounting from the going concern basis to the
liquidation basis effective May 21, 2004. Under the liquidation basis of
accounting, assets are stated at their estimated net realizable values
and liabilities are stated at their estimated settlement amounts.
In estimating liquidation values, fees paid to the plaintiffs' legal
counsel, amounting to $404,501 were recorded as a loss on settlement of
the lawsuit
The accompanying consolidated financial statements have been prepared on
the accrual basis of accounting in accordance with accounting principles
generally accepted in the United States of America and include the
accounts of the Partnership and its wholly-owned subsidiary, Realmark -
Inducon Amherst, LLC which owns Inducon Amherst, an office building
located in Amherst, New York, acquired in 1985.
In consolidation, all intercompany accounts and transactions have been
eliminated.
F-8
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Notes to Consolidated Financial Statements, Continued
(3) Summary of Significant Accounting Policies, Continued
- ---------------------------------------------------------
(b) Estimates
---------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
(c) Property and Equipment
----------------------
Property and equipment are recorded at cost. Depreciation is provided
using the straight-line method over the estimated lives of the assets
from 5 to 25 years. Significant improvements are capitalized, while
expenditures for maintenance, repairs and replacements are charged to
expense as incurred. Upon disposal of depreciable property, the
appropriate property accounts are reduced by the related costs and
accumulated depreciation and resulting gains and losses are reflected in
the consolidated statements of operations.
The Partnership reviews long-lived assets for impairments whenever
events or changes in circumstances indicate that the carrying amount of
the assets may not be recoverable. In determining whether there is an
impairment of long-lived assets, the Partnership compares the sum of the
expected future net cash flows (undiscounted and without interest
charges) to the carrying amount of the assets.
The Partnership's policy is to consider a property to be held for sale
or disposition when the Partnership has committed to a plan to sell or
dispose of such property and active marketing activity has commenced or
is expected to commence in the near term or the Partnership has
concluded that it may dispose of the property by no longer funding
operating deficits or debt service requirements of the property thus
allowing the lender to realize upon its security. Any properties
identified as "held for sale or disposition" are no longer depreciated.
(d) Cash and Equivalents
--------------------
Cash and equivalents includes money market accounts and any highly
liquid debt instruments purchased with a maturity of three months or
less.
(e) Deferred Mortgage Costs
-----------------------
Costs incurred in obtaining mortgage financing are deferred and
amortized using the straight-line method over the life of the
respective mortgages.
F-9
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Notes to Consolidated Financial Statements, Continued
(3) Summary of Significant Accounting Policies, Continued
- ---------------------------------------------------------
(f) Rental Income
-------------
Rental income is recognized as earned according to the terms of the
leases. Leases for residential properties are generally for periods of
one year or less, payable monthly. Commercial leases are generally for
periods of one to five years. Delinquent residential property rent is
not recorded.
(g) Per Unit Data
-------------
Per limited partnership unit is based on the weighted average number of
limited partnership units outstanding for the year.
(h) Fair Value of Financial Instruments
-----------------------------------
The fair value of the Partnership's financial instruments approximated
their carrying values at December 31, 2004.
(i) Income Allocation and Distributable Cash Flow
---------------------------------------------
The partnership agreement provides that income not arising from sale and
refinancing activities and all partnership losses are to be allocated
97% to the limited partners and 3% to the general partners. Partnership
income arising from sale or refinancing activities is allocated in the
same proportion as distributions of distributable cash from sale
proceeds. In the event there is no distributable cash from sale
proceeds, taxable income will be allocated 87% to the limited partners
and 13% to the general partners. The above is subject to tax laws that
were applicable at the time of the formation of the Partnership and may
be adjusted due to subsequent changes in the Internal Revenue Code.
The partnership agreement also provides for the distribution to the
partners of net cash flow from operations. As a result of the sale of
the Partnership's last property, there will be no future distributions
of net cash flow from operations. Sale or refinancing proceeds are
distributed to the extent available, 100% to the limited partners until
there has been a return of the limited partner's capital contribution
plus an amount sufficient to provide a 7%, not compounded, return on
their adjusted capital contributions for all years following the
termination of the offering of the units. It is anticipated that there
will not be sufficient cash flow from the sale of the Partnership's
remaining properties to provide this return to the limited partners.
F-10
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Notes to Consolidated Financial Statements, Continued
(3) Summary of Significant Accounting Policies, Continued
- ---------------------------------------------------------
(j) Income Taxes
------------
No income taxes are included in the consolidated financial statements
since the taxable income or loss of the Partnership is reportable by the
partners on their income tax returns. At December 31, 2004, net assets
for financial reporting purposes were equal to the tax bases of the net
assets.
(k) Segment Information
-------------------
The Partnership's operating segments all involve the ownership and
operation of income-producing real property and are aggregated into one
reporting segment.
(4) Investments in Real Estate
- ------------------------------
On January 1, 2002, the Partnership adopted SFAS No. 144, "Accounting for
the Impairment or Disposal of Long-Lived Assets." SFAS No. 144 supersedes
SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of." SFAS No. 144 establishes the
accounting and reporting standards for the impairment or disposal of
long-lived assets by requiring those assets to be measured at the lower of
depreciated cost or fair value less selling costs, whether reported in
continuing operations or in discontinued operations. This standard does not
change the fundamental provisions of SFAS No. 121; however, it resolves
various implementation issues of SFAS No. 121. The adoption of this
standard did not have a material effect on the Partnership's consolidated
financial position or results of operations for the year ended December 31,
2002.
On May 20, 2004, the Partnership sold Perrymont to an unaffiliated entity
for cash of $2,450,000, less a $600,000 credit for work which the buyer
determined was necessary on the property, and recognized a related gain on
the sale amounting to $144,785.
On April 5, 2004, the Partnership sold Inducon Amherst to an unaffiliated
entity for cash of $2,045,000 and recognized a related gain on the sale
amounting to $19,501.
(5) Mortgage Loan Payable
- --------------------------
8.62% mortgage loan payable with total monthly payment of $15,250. The
mortgage was secured by the Inducon Amherst property. The balance of the
mortgage loan payable amounted to $1,703,787 at December 31, 2003. This
mortgage was repaid in 2004 in connection with the sale of Inducon Amherst.
F-11
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Notes to Consolidated Financial Statements, Continued
(6) Estimated Costs During the Period of Liquidation
- ----------------------------------------------------
Under the liquidation basis of accounting, the Partnership is required to
estimate and record the costs associated with executing the plan of
liquidation as a liability. These amounts can vary significantly due to,
among other things, the costs of retaining personnel, the costs of
insurance, the timing and amounts associated with discharging known and
contingent liabilities and the costs associated with cessation of the
Partnership's operations. These costs are estimates and are expected to be
paid out over the liquidation period. The Partnership's estimated costs
during the period of liquidation as of December 31, 2004 are as follows:
Professional fees $ 70,000
Office and administrative expense 48,387
---------
Total $ 118,387
=========
(7) Related Party Transactions
- -------------------------------
The Corporate General Partner and its affiliates earn fees, principally for
property and partnership management and are reimbursed for services
rendered to the Partnership, as provided for in the partnership agreement.
A summary of those items follows:
Liquidation
period
May 21 to January 1
December to May 20,
31, 2004 2004 2003 2002
-------- ---- ---- ----
Property management fees
based on a percentage
(generally 5%) of the
rental income $ - 17,556 39,261 44,556
Reimbursement for cost of
services to the Partnership
that include investor relations,
marketing of properties, professional
fees, communications, supplies,
accounting, printing, postage and
other items 40,515 97,310 87,061 110,732
--------- --------- -------- -------
$ 40,515 114,866 126,322 155,288
========= ========= ======== =======
In addition to the above, other property specific expenses such as payroll,
benefits, etc. are charged to property operations on the Partnership's
consolidated statements of operations. Payable to affiliated parties bears
interest at 11%, are payable on demand and amounted to $11,777 at December
31, 2004.
F-12
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Notes to Consolidated Financial Statements, Continued
(7) Related Party Transactions, Continued
- -----------------------------------------
Property Disposition Fees
-------------------------
According to the terms of the partnership agreement, the general partners
are allowed to collect property disposition fees upon the sale of acquired
properties. This fee is not to exceed the lesser of 50% of amounts
customarily charged in arm's-length transactions by others rendering
similar services for comparable properties, or 2.75% of the sales price.
The property disposition fee is subordinate to payments to the limited
partners of a cumulative annual return (not compounded) equal to 7% of
their average adjusted capital balances and to repayment to the limited
partners of an amount equal to their capital contributions. The general
partners have not to date received a disposition fee on any property sales,
as the limited partners of the Partnership have not received a return of 7%
on their average adjusted capital or their original capital as defined in
the partnership agreement. Fees earned on the sales will not be recorded as
liabilities by the Partnership until such time as payment is probable.
(8) Settlement of Lawsuit
- -------------------------
As previously reported, the Partnership, as a nominal defendant, the
general partners of the Partnership and of affiliated public partnerships
(the "Realmark Partnerships") and the officers and directors of the
Corporate General Partner, as defendants, had been involved in a class
action litigation at the state court level regarding the payment of fees
and other management issues.
On August 29, 2001, the parties entered into a Stipulation of Settlement
(the "Settlement"). On October 4, 2001, the Court issued an "Order
Preliminary Approving Settlement" (the "Hearing Order") and on November 29,
2001, the Court issued an "Order and Final Judgment Approving Settlement
and Awarding Fees and Expenses" and dismissing the complaints with
prejudice. The Settlement provided, among other things, that all of the
Realmark Partnerships' properties be disposed of. The general partners will
continue to have primary authority to dispose of the Partnerships'
properties. If either (i) the general partners have not sold or contracted
to sell 50% of the Partnerships' properties (by value) by April 2, 2002 or
(ii) the general partners have not sold or contracted to sell 100% of the
Partnerships' properties by September 29, 2002, then the primary authority
to dispose of the Partnerships' properties will pass to a sales agent
designated by plaintiffs' counsel and approved by the Court. On October 4,
2002, the Court appointed a sales agent to work with the general partners
to continue to sell the Partnerships' remaining properties.
F-13
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Notes to Consolidated Financial Statements, Continued
(8) Settlement of Lawsuit, Continued
- -------------------------------------
The settlement also provided for the payment by the Partnerships of fees to
the plaintiffs' attorneys. These payments, which are not calculable at this
time but may be significant, are payable out of the proceeds from the sale
of all of the properties owned by all of the Realmark Partnerships,
following the sale of the last of these properties in each partnership.
Plaintiffs' counsel will receive 15% of the amount by which the sales
proceeds distributable to limited partners in each partnership exceeds the
value of the limited partnership units in each partnership (based on the
weighted average of the units' trading prices on the secondary market as
reported by Partnership Spectrum for the period May through June 2001). In
no event may the increase on which the fees are calculated exceed 100% of
the market value of the units as calculated above. On May 20, 2004, the
Partnership sold its remaining property, and in December 2004, a payment of
$404,501 was made to the plantiffs' attorneys.
F-14
Schedule III
------------
REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - III
AND SUBSIDIARY
Real Estate and Accumulated Depreciation
December 31, 2004, 2003 and 2002
(1) Cost for Federal income tax purposes is none.
(2) A reconciliation of the carrying amount of land, buildings and improvements
as of December 31, 2004, 2003 and 2002 is as follows:
2004 2003 2002
------------ ---------- -----------
Balance at beginning of year $ 6,507,325 6,471,750 6,340,099
Additions - 35,575 131,651
Dispositions (5) (6,507,325) - -
------------ ---------- -----------
Balance at end of year $ - 6,507,325 6,471,750
============ ========== ===========
(3) A reconciliation of accumulated depreciation for the years ended December
31, 2004, 2003, and 2002 is as follows:
2004 2003 2002
------------ --------- ---------
Balance at beginning of year $ 3,016,583 3,016,583 3,016,583
Dispositions (5) (3,016,583) - -
------------ --------- ---------
Balance at end of year (4) $ - 3,016,583 3,016,583
============ ========= =========
(4) Balance applies entirely to buildings and improvements.
(5) Sale of Perrymont Office Building and Inducon Amherst in 2004.
F-15