ITEM 1. BUSINESS
Krupp Cash Plus-II Limited Partnership (the "Partnership") was formed on December 18, 1985 by filing a Certificate of Limited Partnership in The Commonwealth of Massachusetts. The Krupp Corporation and The Krupp Company Limited Partnership-IV are the General Partners of the Partnership. Krupp Depositary Corporation is the Corporate Limited Partner. For details, see Note A to Financial Statements included in Item 8 (Appendix A) of this report.
On March 28, 1986 the Partnership commenced the marketing and sale of 7,500,000 units of Depositary Receipts ("Units") for a maximum offering of $150,000,000. The Partnership raised $149,845,812 from its public offering. The Partnership invested the net proceeds from the offering in a portfolio of unleveraged real estate (see Item 2
ITEM 2. PROPERTIES
As of December 31, 1995, the Partnership has unleveraged investments in four retail centers having an aggregate of 364,894 square feet of leasable space and one apartment complex having 222 units, all of which are wholly- owned by the Partnership. In addition, the Partnership has an unleveraged joint venture investment (the "Joint Venture") in a shopping center with 474,138 square feet of leasable space. Additional detailed information with respect to individual properties is contained in Note D to Financial Statements, Schedule III and the Financial Statements for Brookwood Village Joint Venture included in Item 8 (Appendix A) to this report.
A summary of the Partnership's real estate investments is presented below.
(1) The Partnership has a 50% joint venture interest in this property.
The Partnership has no present plans for major improvements or developments of its unleveraged real estate. Only improvements necessary to keep the Partnership's properties competitive in their respective markets were done and are expected to continue in the next year.
There were no tenants at any of the properties occupying 10% or more of the Partnership's leasable space as of December 31, 1995.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Partnership is a party or to which any of its property is the subject.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None. PART II
ITEM 5.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
There is no public market for the Units and it is not anticipated that any such public market will develop. The transfer of Units is subject to certain limitations contained in the Partnership Agreement.
The number of Investor Limited Partners ("Unitholders") as of December 31, 1995 was approximately 9,900.
The Partnership has made the following distributions to its Partners during the years ended December 31, 1995 and 1994.
One of the objectives of the Partnership is to make partially tax sheltered distributions of cash flow generated by the Partnership's properties and MBS. However, there is no assurance that future operations will continue to generate sufficient cash to maintain the current level of distributions and to provide sufficient liquidity for the Partnership. The Partnership pays a $.20 per Unit, per quarter distribution to its investors.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth selected financial information regarding the Partnership's financial position and operating results. This information should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations, and the Financial Statements and Supplementary Data, which are included in Items 7 and 8 to this report, respectively.
(a) During the years ended December 31, 1995, 1994, 1993, 1992 and 1991 the Limited Partners' average Per Unit return of capital was $.04, $.20, $1.21, $.13 and $.38, respectively.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Partnership's liquidity is derived from the operations of the Partnership's properties (Encino Oaks, Alderwood Towne, Canyon Place, Coral Plaza and Cumberland Glen), distributions from the Partnership's interest in the Joint Venture, earnings and collections on MBS, and interest earned on its short-term investments. The Partnership's liquidity is utilized to pay operating costs and to fund distributions to the partners.
Management has found it necessary in recent years to have the Partnership pay a large share of tenant buildouts to attract quality tenants to our retail centers. This policy has proven to be successful in attracting tenants and maintaining high occupancies at properties where it has been undertaken and is expected to continue in 1996. In order to remain competitive in their respective markets, the Partnership's properties are anticipated to spend approximately $620,000 for fixed assets in 1996, most of which are tenant buildouts at retail centers. The Joint Venture is expected to spend approximately $860,000 for capital improvements.
The Partnership holds MBS that are guaranteed by Government National Mortgage Association ("GNMA"), Federal National Mortgage Association ("FNMA"), and Federal Home Mortgage Corporation ("FHLMC"). The principal risks in respect to MBS are the credit worthiness of GNMA, FNMA, or FHLMC, and the risk that the current value of any MBS may decline as a result of changes in market interest rates. The General Partners believe the interest rate risk is minimal due to the fact that the Partnership has the ability to hold these securities to maturity. Principal collections on MBS have decreased significantly in 1995 because rising interest rates slowed the pace of refinancings that were experienced in 1994.
The Partnership currently enjoys significant liquidity. The General Partners, on an ongoing basis, assess the current and future liquidity needs in determining the levels of working capital the Partnership should maintain. Adjustments to distributions are made when appropriate to reflect such assessments.
Distributable Cash Flow and Net Cash Proceeds from Capital Transactions
Shown below is the calculation of Distributable Cash Flow and Net Cash Proceeds from Capital Transactions, as defined by Section 17 of the Partnership Agreement for the year ended December 31, 1995 and the period from inception to December 31, 1995. The General Partners provide certain of the information below to meet requirements of the Partnership Agreement and because they believe that it is an appropriate supplemental measure of operating performance. However, Distributable Cash Flow and Net Cash Proceeds from Capital Transactions should not be considered by the reader as a substitute to net income as an indicator of the Partnership's operating performance or to cash flow as a measure of liquidity.
(a) Represents distributions paid in 1995, except the February, 1995 distribution which relates to 1994 cash flows, and includes an estimate of the distribution to be paid in February, 1996. (b) Includes an estimate of the distribution to be paid in February, 1996. (c) Limited Partners' average per Unit return of capital as of February, 1996 is $4.53 [$12.51 - $7.98]. Operations
Partnership
1995 compared to 1994 Cash flow increased due to decreased capital improvements, increased rental revenues and distributions received from the Joint Venture. Rental revenues in 1995 have increased when compared to 1994 as a result of changes at Canyon Place and Cumberland Glen. Canyon Place experienced an 8% increase in occupancy in 1995 as compared to 1994. This increase in occupancy is due to the opening of the 4,391 square foot Payless Shoes and the 10,592 square foot Petco Pet Food and Supplies stores in the fourth quarter of 1994 and to the expansion of several tenants within the last year. At Cumberland Glen, the strong economic environment in the Atlanta, Georgia area has allowed management to increase rental rates on certain floor plans. All other properties have experienced relatively stable occupancies with minor rental increases during 1995.
Total expenses as a whole remained relatively stable. However, individually, maintenance, operating, general and administrative, and real estate taxes all changed significantly in 1995 as compared to 1994. Operating and general and administrative expenses decreased as a result of management's efforts to reduce reimbursable expenses throughout 1995. Maintenance expense decreased in 1995 as compared to the same period in 1994 due to preventive maintenance at Encino Oaks, roof repairs at Canyon Place, and improvements to the parking lot and building interiors at Cumberland Glen, all performed in 1994. The increase in real estate taxes is due primarily to a refund of approximately $270,000 recorded in the second quarter of 1994 for prior years' real estate taxes at Coral Plaza.
1994 compared to 1993
In comparing 1994 to 1993, distributable cash flow increased $60,000 as increased distributions from the Joint Venture more than offset increases in capital improvements. Rental revenues for 1994 as compared to 1993 remained relatively stable due mainly to consistent occupancy levels at all the Partnership's properties within the period.
Total expenses decreased $242,000 in 1994 as compared to 1993. This was primarily due to a reduction in real estate taxes. Coral Plaza received a refund of approximately $270,000 for prior years' real estate taxes in the second quarter of 1994. Depreciation increased by $108,000 in 1994 as compared to 1993 as a result of higher tenant buildouts at Canyon Place and Encino Oaks in order to attract quality tenants to their respective retail centers.
MBS and Other Income
MBS interest income decreased $151,000 in 1995 from 1994, and $411,000 in 1994 from 1993 due to large prepayments of principal which occurred from 1993 to the first half of 1995. The asset balance on which income is generated has decreased approximately 13% since
December 31, 1994 and approximately 33% since December 31, 1993. Interest income on short-term investments has increased since 1993 due to higher average cash and cash equivalent balances.
Joint Venture
The Joint Venture's revenues for 1995 as compared to 1994 have remained relatively stable as a result of steady occupancy throughout 1995. Total expenses in 1995 as compared to 1994 have remained relatively flat. Real estate taxes decreased as a result of an abatement in the third quarter of 1995 due to the revaluation of the Joint Venture by the local taxing authority. This reduction is offset by an increase in operating expense attributable to increased leasing efforts by management. Depreciation expense increased due to a large number of tenant buildouts and improvements completed in 1995 and 1994.
The Joint Venture's revenues increased in 1994 primarily due to an increase in occupancy of 4% over 1993. Depreciation expense increased due to a large number of tenant buildouts and capital renovations completed in 1994 and 1993.
General
In accordance with Financial Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", which is effective for fiscal years beginning after December 15, 1995, the Partnership has implemented policies and practices for assessing impairment of its real estate assets.
The Partnership's investments in properties and the Joint Venture are carried at cost less accumulated depreciation unless the General Partners believe there is a significant impairment in value, in which case a provision to write down investments in properties and the Joint Venture to fair value will be charged against income. At this time, the General Partners do not believe that any assets of the Partnership are signifantly impaired.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See Appendix A of this Report.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None. PART III
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Partnership has no directors or executive officers. Information as to the directors and executive officers of The Krupp Corporation, which is a General Partner of both the Partnership and The Krupp Company Limited Partnership-IV, the other General Partner of the Partnership, is as follows:
Position with Name and Age The Krupp Corporation
Douglas Krupp (49) Co-Chairman of the Board George Krupp (51) Co-Chairman of the Board Laurence Gerber (39) President Robert A. Barrows (38) Senior Vice President and Corporate Controller
Douglas Krupp is Co-Chairman and Co-Founder of The Berkshire Group. Established in 1969 as the Krupp Companies, this real estate-based firm expanded over the years within its areas of expertise including investment program sponsorship, property and asset management, mortgage banking, healthcare facility ownership and the management of the Company. Today, The Berkshire Group is an integrated real estate, mortgage and healthcare company which is headquartered in Boston with regional offices throughout the country. A staff of 3,400 are responsible for the more than $4 billion under management for institutional and individual clients. Mr. Krupp is a graduate of Bryant College. In 1989 he received an honorary Doctor of Science in Business Administration from this institution and was elected trustee in 1990. Mr. Krupp is Chairman of the Board and a Director of Berkshire Realty Company, Inc. (NYSE-BRI). George Krupp is Douglas Krupp's brother.
George Krupp is the Co-Chairman and Co-Founder of The Berkshire Group. Established in 1969 as the Krupp Companies, this real estate-based firm expanded over the years within its areas of expertise including investment program sponsorship, property and asset management, mortgage banking and healthcare facility ownership. Today, The Berkshire Group is an integrated real estate, mortgage and healthcare company which is headquartered in Boston with regional offices throughout the country. A staff of 3,400 are responsible for more than $4 billion under management for institutional and individual clients. Mr. Krupp attended the University of Pennsylvania and Harvard University. Mr. Krupp also serves as Chairman of the Board and Trustee of Krupp Government Income Trust and as Chairman of the Board and Trustee of Krupp Government Income Trust II.
Laurence Gerber is the President and Chief Executive Officer of The Berkshire Group. Prior to becoming President and Chief Executive Officer in 1991, Mr. Gerber held various positions with The Berkshire Group which included overall responsibility at various times for: strategic planning and product development, real estate acquisitions, corporate finance, mortgage banking, syndication and marketing. Before joining The Berkshire Group in 1984, he was a management consultant with Bain & Company, a national consulting firm headquartered in Boston. Prior to that, he was a senior tax accountant with Arthur Andersen & Co., an international accounting and consulting firm. Mr. Gerber has a B.S. degree in Economics from the University of Pennsylvania, Wharton School and an M.B.A. degree with high distinction from Harvard Business School. He is a Certified Public Accountant. Mr. Gerber also serves as President and Director of Berkshire Realty Company, Inc. (NYSE-BRI) and President and Trustee of Krupp Government Income Trust and President and Trustee of Krupp Government Income Trust II.
Robert A. Barrows is Senior Vice President and Chief Financial Officer of Berkshire Mortgage Finance and Corporate Controller of The Berkshire Group. Mr. Barrows has held several positions within The Berkshire Group since joining the company in 1983 and is currently responsible for accounting and financial reporting, treasury, tax, payroll and office administrative activities. Prior to joining The Berkshire Group, he was an audit supervisor for Coopers & Lybrand L.L.P. in Boston. He received a B.S. degree from Boston College and is a Certified Public Accountant.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
The Partnership has no directors or executive officers.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of December 31, 1995, no person of record owned or was known by the General Partners to own beneficially more than 5% of the Partnership's 7,499,818 outstanding Depositary Receipts. The only interests held by management or its affiliates consist of its General Partner and Corporate Limited Partner Interests.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Partnership does not have any directors, executive officers or nominees for election as director. Additionally, as of December 31, 1995, no person of record owned or was known by the General Partners to own beneficially more than 5% of the Partnership's outstanding Units.
PART IV
ITEM 14.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULE AND REPORTS ON FORM 8-K
(a) 1. Financial Statements - see Index to Financial Statements and Schedule included under Item 8 (Appendix A) on page of this report.
2. Financial Statement Schedule - see Index to Financial Statements and Schedule included under Item 8 (Appendix A) on page of this report. All other schedules are omitted as they are not applicable, not required or the information is provided in the Financial Statements or the Notes thereto.
3. Financial Statements - as required by Rule 3-09 of Regulation S-X. The financial statements and schedule for Brookwood Village Joint Venture (the "Joint Venture") are included under Item 8 (Appendix A) on pages to of this report.
(b) Exhibits:
Number and Description Under Regulation S-K
The following reflects all applicable Exhibits required under Item 601 of Regulation S-K:
(4) Instruments defining the rights of security holders including indentures:
(4.1) Amended Agreement of Limited Partnership dated as of March 25, 1986 [Exhibit A to Prospectus included in Amendment No. 1 of Registrant's Registration Statement on Form S-11 dated March 26, 1986 (File No. 33-2312)].*
(4.2) Subscription Agreement Specimen [Exhibit D to Prospectus included in Amendment No. 1 of Registrant's Registration Statement on Form S-11 dated March 26, 1986 (File No. 33-2312)].*
(4.3) Eleventh Amendment and Restatement of Certificate of Limited Partnership filed with the Massachusetts Secretary of State as of February 6, 1987. [Exhibit 4.3a to Registrant's Report on Form 10-K dated December 31, 1986 (File No. 33-2312)].*
(10) Material Contracts:
Encino Oaks Plaza
(10.1) Krupp Standard Purchase Agreement dated July 16, 1986 between Krupp Realty and Development, Inc., a Massachusetts corporation and Cal-American Income Property Fund II, a California limited partnership. [Exhibit 1 to Registrant's Report on Form 8-K dated July 31, 1986 (File No. 33-2312)].*
(10.2) Assignment of Contract between Krupp Realty and Development, Inc., a Massachusetts corporation and Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership dated July 28, 1986. [Exhibit 2 to Registrant's Report on Form 8-K dated July 31, 1986 (File No. 33-2312)].*
(10.3) Partnership Grant Deed dated July 31, 1986 from Cal-American Income Property Fund II a California limited partnership, to Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership. [Exhibit 3 to Registrant's Report on Form 8-K dated July 31, 1986 (File No. 33-2312)].*
(10.4) Management Agreement dated July 31, 1986 between Krupp Cash Plus-II Limited Partnership, as Owner and Krupp Asset Management Company, now known as Berkshire
Property Management ("BPM"), as Agent. [Exhibit 10.4a to Registrant's Report on Form 10-K dated December 31, 1986 (File No. 33- 2312)].*
Alderwood Towne Center
(10.5) Krupp Standard Option Agreement dated July 16, 1986 between Krupp Realty and Development, Inc., a Massachusetts corpora- tion and Alderwood Towne Center, a Washington tenancy-in-common. [Exhibit 10.5 included in Registrant's Post Effective Amendment No. 2 to its Form S-11 Registration Statement dated September 3, 1986 (File No. 33-2312)].*
(10.6) Escrow Agreement dated August 12, 1986 between Krupp Realty and Development, Inc., a Massachusetts corporation and Alderwood Towne Center, a Washington tenancy-in-common. [Exhibit 10.5 included in Registrant's Post Effective Amendment No. 2 to its Form S-11 Registration Statement dated September 3, 1986 (File No. 33-2312)].*
(10.7) Amendment to Option Agreement dated July 17, 1986 between Krupp Realty and Development, Inc., a Massachusetts corporation and Alderwood Towne Center, a Washington tenancy- in-common. [Exhibit 10.5 included in Registrant's Post Effective Amendment No. 2 to its Form S-11 Registration Statement dated September 3, 1986 (File No. 33-2312)].*
(10.8) Assignment of Option Agreement between Krupp Realty and Development, Inc. a Massachusetts corporation and Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership dated August 20, 1986. [Exhibit 4 to Registrant's Report on Form 8-K dated September 3, 1986 (File No. 33-2312)].*
(10.9) Statutory Warranty Deed dated September 3, 1986 between Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership and Alderwood Towne Center Associates. [Exhibit 5 to Registrant's Report on Form 8-K dated September 3, 1986 (File No. 33-2312)].*
(10.10) Property Management Agreement dated September 3, 1986 between Krupp Cash Plus-II Limited Partnership, as Owner and Krupp Asset Management Company, now known as Berkshire Property Management ("BPM"), as Agent. [Exhibit 6 to Registrant's Report on Form 8-K
dated September 3, 1986 (File No. 33-2312)].*
Brookwood Village Mall and Convenience Center
(10.11) Purchase and Sale Agreement dated December 5, 1986 between Krupp Realty and Development Inc., a Massachusetts corporation and Everett Shepherd, Jr. et al as assigned to Brookwood Village Joint Venture. [Exhibit 1 to Registrant's Report on Form 8-K dated December 16, 1986 (File No. 33-2312)].*
(10.12) Statutory Warranty Deed with Vendors' Lien dated December 16, 1986 between Brookwood Village Joint Venture and Everett Shepherd, Jr. et al. [Exhibit 2 to Registrant's Report on Form 8-K dated December 16, 1986 (File No. 33-2312)].*
(10.13) Business Certificate dated December 11, 1986 establishing Brookwood Village Joint Venture. [Exhibit 3 to Registrant's Report on Form 8-K dated December 16, 1986 (File No. 33-2312)].*
(10.14) Brookwood Village Joint Venture Agreement dated December 15, 1986 between Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership and Krupp Cash Plus-III Limited Partnership, a Massachusetts limited partnership, now known as Berkshire Realty Company, Inc. [Exhibit 10.14 to Registrant's Report on Form 10-K dated December 31, 1986 (File No. 33-2312)].*
(10.15) Property Management Agreement dated December 16, 1986 between Brookwood Village Joint Venture, as Owner and Krupp Asset Management Company, now known as Berkshire Property Management ("BPM"), as Agent. [Exhibit 4 to Registrant's Report on Form 8-K dated December 16, 1986 (File No. 33- 2312)].*
Canyon Place Shopping Center
(10.16) Krupp Standard Option Agreement dated October 24, 1986 between Krupp Realty and Development, Inc., a Massachusetts corporation and Canyon Place Associates, a Washington tenancy-in-common. [Exhibit 1 to Registrant's Report on Form 8-K dated December 23, 1986 (File No. 33-2312)].*
(10.17) Amendment to Option Agreement dated December 9, 1986 between Krupp Realty and Development, Inc., a Massachusetts
corporation and Canyon Place Associates, a Washington tenancy-in-common. [Exhibit 2 to Registrant's Report on Form 8-K dated December 23, 1986 (File No. 33-2312)].*
(10.18) Assignment of Option Agreement dated December 17, 1986 between Krupp Realty and Development, Inc., a Massachusetts corporation and Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership. [Exhibit 3 to Registrant's Report on Form 8-K dated December 23, 1986 (File No. 33-2312)].*
(10.19) Warranty Deed dated December 23, 1986 between Canyon Place Associates, a Washington tenancy-in-common, as Grantor and Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership, as Grantee. [Exhibit 4 to Registrant's Report on Form 8-K dated December 23, 1986 (File No. 33-2312)].*
(10.20) Property Management Agreement dated December 23, 1986 between Krupp Cash Plus- II Limited Partnership, as Owner and Krupp Asset Management Company, now known as Berkshire Property Management ("BPM"), as Agent. [Exhibit 6 to Registrant's Report on Form 8-K dated December 23, 1986 (File No. 33-2312)].*
Coral Plaza Shopping Center
(10.21) Purchase and Sale Agreement dated May 8, 1987 between Harris Trust and Savings Bank, as trustee under Trust No. 42703, and Krupp Realty and Development, Inc., a Massachusetts corporation, as assigned to Krupp Cash Plus-II Limited Partnership. [Exhibit 19.1 to Registrant's Report on Form 10-Q dated June 30, 1987 (File No. 33- 2312)].*
(10.22) Assignment between Coral Plaza Limited Partnership and Harris Trust and Savings Bank, as Trustee under Trust No. 42703, collectively as "Assignor," and Krupp Cash Plus-II Limited Partnership, a Massachusetts limited partnership, as "Assignee" dated June 2, 1987. [Exhibit 19.2 to Registrant's Report on Form 10-Q dated June 30, 1987 (File No. 33-2312)].*
(10.23) Trustee's Deed dated May 28, 1987 from Harris Trust and Savings Bank, as trustee
under Trust No. 42703, to Krupp Cash Plus- II Limited Partnership. [Exhibit 19.3 to Registrant's Report on Form 10-Q dated June 30, 1987 (File No. 33-2312)].*
(10.24) Property Management Agreement, dated June 1, 1987, between Krupp Cash Plus-II Limited Partnership, as Owner, and Krupp Asset Management Company, now known as Berkshire Property Management ("BPM"), as Agent. [Exhibit 19.4 to Registrant's Report on Form 10-Q dated June 30, 1987 (File No. 33- 2312)].*
Cumberland Glen Apartments
(10.25) Agreement of Purchase and Sale, dated August 24, 1987 between FNBC Properties, Inc., a Delaware corporation, as "Seller," and Krupp Realty and Development, Inc., a Massachusetts corporation, as "Purchaser." [Exhibit 19.5 to Registrant's Report on Form 10-Q dated September 30, 1987 (File No. 0-15816)].*
(10.26) Assignment of purchase and sale agreement, dated August 24, 1987 between Krupp Realty and Development, Inc., and Krupp Cash Plus- II Limited Partnership, a Massachusetts limited partnership. [Exhibit 19.6 to Registrant's Report on Form 10-Q dated September 30, 1987 (File No. 0-15816)].*
(10.27) Quit Claim Deed, dated September 3, 1987, between The First National Bank of Chicago, and Krupp Cash Plus-II Limited Partnership. [Exhibit 19.7 to Registrant's Report on Form 10-Q dated September 30, 1987 (File No. 0-15816)].*
(10.28) Property Management Agreement, dated September 3, 1987, between Krupp Cash Plus- II Limited Partnership, as Owner, and Krupp Asset Management Company, now known as Berkshire Property Management ("BPM"), as Agent. [Exhibit 19.8 to Registrant's Report on Form 10-Q dated September 30, 1987 (File No. 0-15816)].*
* Incorporated by reference.
(c) Reports on Form 8-K
During the last quarter of the year end December 31, 1995 the Partnership did not file any reports on Form 8-K.
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, on the 21st day of March, 1996.
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
By: The Krupp Corporation, a General Partner
By: /s/Douglas Krupp Douglas Krupp, Co-Chairman (Principal Executive Officer) and Director of The Krupp Corporation
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 indicated, on the 21st day of March, 1996.
Signatures Titles
/s/Douglas Krupp Co-Chairman (Principal Executive Officer) Douglas Krupp Director of The Krupp Corporation (a and General Partner of the Registrant)
/s/George Krupp Co-Chairman (Principal Executive Officer) George Krupp and Director of The Krupp Corporation (a) General Partner of the Registrant)
/s/Laurence Gerber President of The Krupp Corporation (a Laurence Gerber General Partner of the Registrant)
/s/Robert A. Barrows Senior Vice President and Corporate Robert A. Barrows Controller of the Krupp Corporation (a General Partner of the Registrant)
APPENDIX A
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
ITEM 8 of FORM 10-K
ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION For the Year Ended December 31, 1995
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
INDEX TO FINANCIAL STATEMENTS AND SCHEDULE
Report of Independent Accountants
Balance Sheets at December 31, 1995 and 1994
Statements of Operations for the Years Ended December 31, 1995, 1994 and 1993
Statements of Changes in Partners' Equity for the Years Ended December 31, 1995, 1994 and 1993
Statements of Cash Flows for the Years Ended December 31, 1995, 1994 and 1993
Notes to Financial Statements -
Schedule III - Real Estate and Accumulated Depreciation -
Financial Statements - Brookwood Village Joint Venture -
All other schedules are omitted as they are not applicable or not required, or the information is provided in the financial statements or the notes thereto.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Partners of Krupp Cash Plus-II Limited Partnership:
We have audited the financial statements and financial statement schedule of Krupp Cash Plus-II Limited Partnership (the "Partnership") listed in the index on page of this Form 10-K. These financial statements and financial statement schedule are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes 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.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Krupp Cash Plus-II Limited Partnership as of December 31, 1995 and 1994, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 1995 in conformity with generally accepted accounting principles. In addition, in our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material respects, the information required to be included therein.
Boston, Massachusetts COOPERS & LYBRAND L.L.P. January 31, 1996
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
BALANCE SHEETS December 31, 1995 and 1994
ASSETS
The accompanying notes are an integral part of the financial statements.
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS For the Years Ended December 31, 1995, 1994 and 1993
The accompanying notes are an integral part of the financial statements.
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
STATEMENTS OF CHANGES IN PARTNERS' EQUITY For the Years Ended December 31, 1995, 1994 and 1993
The accompanying notes are an integral part of the financial statements.
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS For the Years Ended December 31, 1995, 1994 and 1993
The accompanying notes are an integral part of the financial statements.
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
A. Organization
Krupp Cash Plus-II Limited Partnership (the "Partnership") was formed on December 18, 1985 by filing a Certificate of Limited Partnership in The Commonwealth of Massachusetts. The Partnership has issued all of the General Partner Interests to The Krupp Corporation and The Krupp Company Limited Partnership-IV in exchange for capital contributions aggregating $3,000. Except under certain limited circumstances upon termination of the Partnership, the General Partners are not required to make any additional capital contributions. The Partnership will continue to exist until December 31, 2025, unless earlier terminated upon occurrence of certain events as set forth in the Partnership Agreement.
The Partnership has issued 100 Limited Partner Interests to Krupp Depositary Corporation (the "Corporate Limited Partner") in exchange for a capital contribution of $2,000. The Corporate Limited Partner, in turn, has issued Depositary Receipts ("Units") to the investors and has assigned all of its rights and interest in the Limited Partner Interests (except for its $2,000 Limited Partner's interest) to the holders of Depositary Receipts. As of January 21, 1987, the Partnership completed its public offering having sold 7,499,818 Units for $149,845,812, net of $150,548 of purchase volume discounts.
B. Significant Accounting Policies
The Partnership uses the following accounting policies for financial reporting purposes, which may differ in certain respects from those used for federal income tax purposes (see Note K).
Risks and Uncertainties
The Partnership invests its cash primarily in deposits and money market funds with commercial banks. The Partnership has not experienced any losses to date on its invested cash.
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash Equivalents
The Partnership includes all short-term investments with
maturities of three months or less from the date of acquisition in cash and cash equivalents. The cash equivalents are recorded at cost, which approximates current market values.
Rental Revenues
Leases require the payment of base rent monthly in advance. Rental revenues are recorded on the accrual basis. Commerical leases generally contain provisions for additional rent based on a percentage of tenant sales and other provisions which are also recorded on the accrual basis, but are billed in arrears. Minimum rental revenue for long term commercial leases is recognized on a straight- line basis over the life of the related lease.
Leasing Commissions
Leasing commissions on commercial properties are deferred and amortized over the life of the related lease.
Depreciation
Depreciation is provided for by the use of the straight-line method over the estimated useful lives of the related assets as follows:
Buildings and improvements 2 to 25 years Appliances, carpeting and equipment 3 to 5 years
Impairment of Long-Lived Assets
In accordance with Financial Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", which is effective for fiscal years beginning after December 15, 1995, the Partnership has implemented policies and practices for assessing impairment of its real estate assets.
The Partnership routinely performs market and growth studies along with yearly appraisals of its unleveraged real estate. The investments in properties and Joint Venture are carried at cost less accumulated depreciation unless the General Partners believe there is a significant impairment in value, in which case a provision to write down investments in properties and the Joint Venture to fair value will be charged against income. At this time, the General Partners do not believe that any assets of the Partnership are significantly impaired.
Investment in Joint Venture
The Partnership has a 50% interest in the Joint Venture. This investment is accounted for using the equity method of accounting as the Partnership Agreement requires a simple majority vote for all major decisions regarding the Joint
Venture. As such, the Partnership does not have control of the operations of the underlying assets. Under the equity method of accounting, the Partnership's equity investment in the net income of the Joint Venture is included currently in the Partnership's net income. Cash distributions received from the Joint Venture reduce the Partnership's investment.
MBS
MBS are held for long-term investment and are carried at amortized cost. Premiums or discounts are amortized over the life of the underlying securities using the effective yield method. The market value of MBS is determined based on quoted market prices.
Income Taxes
The Partnership is not liable for federal or state income taxes as Partnership income is allocated to the partners for income tax purposes. In the event that the Partnership's tax returns are examined by the Internal Revenue Service or state taxing authority and the examination results in a change in the Partnership's taxable income, such change will be reported to the partners.
Reclassifications
Certain prior year balances have been reclassified to conform with current year financial statement presentation.
C. Cash and Cash Equivalents
Cash and cash equivalents at December 31, 1995 and 1994 consist of the following: December 31, 1995 1994
Cash and money market accounts $ 710,395 $ 546,430 Commercial paper 6,365,784 5,534,478 Bankers' acceptance 989,727 991,219
$8,065,906 $7,072,127
At December 31, 1995, commercial paper and bankers acceptance represent corporate issues complying with Section 6.2(a) of the Partnership Agreement purchased through a corporate issuer maturing in the first quarter of 1996. At December 31, 1995, the carrying value of the Partnership's investment in both commercial paper and bankers' acceptance approximates fair value.
D. Investment in Joint Venture
The Partnership and an affiliate of the Partnership each have a 50% interest in the Joint Venture. The express purpose of entering into the Joint Venture was to acquire and operate
Brookwood Village Mall and Convenience Center ("Brookwood Village"). Brookwood Village is a shopping center containing 474,138 net leasable square feet located in Birmingham, Alabama.
Under the purchase and sale agreement entered into by the Partnership, its affiliates and the previous owner, the previous owner retained an interest related to the future development at Brookwood Village. The seller is entitled to receive up to $5,000,000 of proceeds from the sale of Brookwood Village and potentially additional amounts related to expansion and development. The Joint Venture holds title to Brookwood Village free and clear from all other material liens or encumbrances.
Financial statements for Brookwood Village Joint Venture are included on pages to of this report.
E. Mortgage Backed Securities
At December 31, 1995, the Partnership's MBS Portfolio has an approximate market value of approximately $9,044,000 with unrealized gains of approximately $542,000 and no unrealized losses. At December 31, 1994, the Partnership's MBS Portfolio had an approximate market value of approximately $9,902,000 with unrealized gains of approximately $217,000 and unrealized losses of approximately $130,000. The Portfolio consists of Federal Home Loan Mortgage Corporation holdings with coupon rates ranging from 8.0% to 10.0% per annum maturing in the years 2009 through 2017, Federal National Mortgage Association holdings with coupon rates ranging from 9.5% to 10.0% per annum maturing in the year 2016 and Government National Mortgage Association holdings with coupon rates of 9.0% per annum maturing in the years 2008 through 2009. The Partnership has the intention and ability to hold the MBS and other investments until maturity.
F. Accrued Expenses and Other Liabilities
Accrued expenses and other liabilities consist of the following at December 31, 1995 and 1994: 1995 1994
Accrued real estate taxes $264,996 $276,181 Tenant security deposits 186,242 188,385 Other accrued expenses 34,636 86,494 Prepaid rent 47,459 42,063 $533,333 $593,123
G. Partners' Equity
Profits or losses from Partnership operations and Distributable Cash Flow are allocated 98% to the Unitholders and Corporate Limited Partner (the "Limited Partners") (based on Units held) and 2% to the General Partners. Profits arising from a capital transaction will be allocated in the same manner as related cash distributions which is described below. Losses from a capital transaction will be allocated 98% to the Limited Partners and 2% to the General Partners.
Upon the occurrence of a capital transaction, as defined in the Partnership Agreement, proceeds will be applied to the payment of all debts and liabilities of the Partnership then due and then fund any reserves for contingent liabilities. Remaining net cash proceeds will then be distributed first, to the Limited Partners until they have received a return of their total invested capital, second, to the General Partners until they have received a return of their total invested capital, third, to the Limited Partners until they have received any deficiency in the 12% cumulative return on invested capital through fiscal years prior to the date of the capital transaction, fourth, to the General Partners until they have received an amount necessary so that the amounts of net cash proceeds whenever allocated under number three and number four are in the ratio of 85 to 15, and fifth, 85% to the Limited Partners and 15% to the General Partners.
As of December 31, 1995, the following cumulative partner contributions and allocations have been made since inception of the Partnership:
H. Related Party Transactions
Commencing with the date of acquisition of the Partnership's properties, the Partnership entered into agreements under which property management fees are paid to an affiliate of the General Partners for services as management agent. Such agreements provide for management fees payable monthly at a rate up to 6% of the gross receipts net of leasing commissions from commercial properties under management and up to 5% of the gross receipts from residential properties under management. The Partnership also reimburses affiliates of the General Partners for certain expenses incurred in connection with the operation of the properties including accounting, computer, insurance, travel, legal and payroll, and with the preparation and mailing of reports and other communications to the Unitholders.
Amounts paid to the General Partners or their affiliates were as follows:
1995 1994 1993
Management Fees $374,554 $348,589 $356,485
Expense Reimbursements 322,733 537,516 565,807
Charged to operations $697,287 $886,105 $922,292
I. Future Base Rents Due Under Commercial Operating Leases
Future base rents due under commercial operating leases for the years 1996 through 2000 and thereafter are as follows:
1996 $3,964,700 1997 3,244,700 1998 2,907,500 1999 2,640,200 2000 2,218,100 Thereafter 5,895,300
J. Real Estate Taxes
During the second quarter of 1994, the Partnership successfully petitioned for the reassessment of prior years' real estate taxes on Coral Plaza. The Partnership received a tax refund for the 1987, 1988 and 1989 fiscal real estate tax years of approximately $270,000, which was reflected as a reduction of 1994 real estate tax expense.
K. Federal Income Taxes
For federal income tax purposes, the Partnership is depreciating its property using the accelerated cost recovery system ("ACRS") and the modified accelerated cost recovery system ("MACRS") depending on which is applicable.
The reconciliation of the income for each year reported in the accompanying statement of operations with the income reported in the Partnership's 1995, 1994 and 1993 federal income tax return follows:
The allocation of the net income for federal income tax purposes for 1995 is as follows:
During the years ended December 31, 1995, 1994 and 1993 the average per Unit income to the Unitholders for federal income tax purposes was $.57, $.48, and $.47, respectively.
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
SCHEDULE III- REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 1995
(a) The Partnership uses the cost basis for property valuation for both income tax and financial statement purposes. The Partnership holds title to its properties free and clear from all mortgage indebtedness or other material liens or encumbrances. The aggregate cost for federal income tax purposes at December 31, 1995 is $60,500,636.
(b) Canyon Place received a cash settlement of $50,406, net of legal costs, for the granting of a railroad easement in 1994. For financial reporting purposes, the carrying value of land has been reduced accordingly.
Continued
KRUPP CASH PLUS-II LIMITED PARTNERSHIP
SCHEDULE III- REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued December 31, 1995
Reconciliation of Real Estate and Accumulated Depreciation for each of the three years in the period ended December 31, 1995:
BROOKWOOD VILLAGE JOINT VENTURE
FINANCIAL STATEMENTS AND SCHEDULE For the Year Ended December 31, 1995
BROOKWOOD VILLAGE JOINT VENTURE
INDEX TO FINANCIAL STATEMENTS AND SCHEDULE
Report of Independent Accountants
Balance Sheets at December 31, 1995 and 1994
Statements of Operations for the Years Ended December 31, 1995, 1994 and 1993
Statements of Changes in Partners' Equity for the Years Ended December 31, 1995, 1994 and 1993
Statements of Cash Flows for the Years Ended December 31, 1995, 1994 and 1993
Notes to Financial Statements -
Schedule III - Real Estate and Accumulated Depreciation -
All other schedules are omitted as they are not applicable or not required, or the information is provided in the financial statements or the notes thereto.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Joint Venture Partners of Brookwood Village Joint Venture:
We have audited the financial statements and financial statement schedule of Brookwood Village Joint Venture (the "Joint Venture") listed in the index on\ page of this Form 10-K. These financial statements and financial statement schedule are the responsibility of the Joint Venture's management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes 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.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Joint Venture as of December 31, 1995 and 1994, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 1995 in conformity with generally accepted accounting principles. In addition, in our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material respects, the information required to be included therein.
Boston, Massachusetts COOPERS & LYBRAND L.L.P. January 31, 1996
BROOKWOOD VILLAGE JOINT VENTURE
BALANCE SHEETS December 31, 1995 and 1994
The accompanying notes are an integral part of the financial statements.
BROOKWOOD VILLAGE JOINT VENTURE
STATEMENTS OF OPERATIONS For the Years Ended December 31, 1995, 1994 and 1993
The accompanying notes are an integral part of the financial statements.
BROOKWOOD VILLAGE JOINT VENTURE
STATEMENTS OF CHANGES IN PARTNERS' EQUITY For the Years Ended December 31, 1995, 1994 and 1993
The accompanying notes are an integral part of the financial statements.
BROOKWOOD VILLAGE JOINT VENTURE
STATEMENTS OF CASH FLOWS For the Years Ended December 31, 1995, 1994 and 1993
The accompanying notes are an integral part of the financial statements.
BROOKWOOD VILLAGE JOINT VENTURE
NOTES TO FINANCIAL STATEMENTS
A. Organization
On December 16, 1986 Brookwood Village Joint Venture (the "Joint Venture") acquired Brookwood Village Mall and Convenience Center ("Brookwood Village"), a retail development located in Birmingham, Alabama. Brookwood Village consists of a covered mall, a covered garage and a detached strip shopping center with an aggregate net leasable square footage of 474,138. The Joint Venture is 50% owned by Krupp Cash Plus-II Limited Partnership and Texas Apartments Limited Partnership ("Joint Venture Partners"), both with similar investment objectives. The express purpose of entering into the Joint Venture was to purchase, own, manage and operate Brookwood Village. Neither the Joint Venture Partners nor the Joint Venture had any affiliation with the seller. The Joint Venture shall exist until December 16, 2006 unless earlier terminated upon occurrence of certain events as set forth in the Brookwood Village Joint Venture Agreement. The seller has retained an interest related to future development at Brookwood Village entitling the seller to the first $5,000,000 of proceeds from the sale of Brookwood Village.
B. Significant Accounting Policies
The Joint Venture uses the following accounting policies for financial reporting purposes, which may differ in certain respects from those used for federal income tax purposes (see Note H):
Risks and Uncertainties
The Joint Venture invests its cash primarily in deposits and money market funds with commercial banks. The Joint Venture has not experienced any losses to date on its invested cash.
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash Equivalents
The Joint Venture includes all short-term investments with maturities of three months or less from the date of acquisition in cash and cash equivalents. Cash equivalents are recorded at cost, which approximates current market value.
Rental Revenues
Commercial leases require the payment of base rent monthly in
advance. Rental revenues are recorded on the accrual basis. Commercial leases generally contain provisions for additional rent based on a percentage of tenant sales and other provisions which are recorded as income when received. Minimum rental revenue from long-term commercial leases is recognized on a straight-line basis over the life of the related lease.
Depreciation
Depreciation of building and improvements is provided for by the use of the straight-line method over estimated useful lives of 3-25 years. Tenant improvements are depreciated over the life of the lease.
Impairment of Long-Lived Assets
In accordance with Financial Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", which is effective for fiscal years beginning after December 15, 1995, the Partnership has implemented policies and practices for assessing impairment of its real estate assets.
The Joint Venture Partners routinely perform market and growth studies along with yearly appraisals of their unleveraged real estate. The properties are carried at cost less accumulated depreciation unless the Joint Venture Partners believe there is a significant impairment in value, in which case a provision to write down investments in properties to fair value will be charged against income. At this time, the Joint Venture
Partners do not believe that any assets of the Joint Venture are significantly impaired.
Leasing Commissions
Leasing commissions are deferred and amortized over the life of the related lease.
Income Taxes
The Joint Venture is not liable for federal or state income taxes because Joint Venture income or loss is allocated to the Joint Venture Partners for income tax purposes. In the event the Joint Venture's tax returns are examined by the Internal Revenue Service or state taxing authority and such an examination results in a change in the Joint Venture taxable income or loss, such change will be reported to the Joint Venture Partners.
C. Cash and Cash Equivalents
Cash and cash equivalents at December 31, 1995 and 1994 consist
of the following: December 31, 1995 1994
Cash and money market accounts $234,661 $271,662 Commercial paper - 348,464
$234,661 $620,126
D. Accrued Expenses and Other Liabilities
Accrued expenses and other liabilities consist of the following at December 31, 1995 and 1994:
E. Partner's Equity
Under the terms of the Brookwood Village Joint Venture Agreement, profits, losses and distributions are allocated 50% to each Joint Venture Partner.
As of December 31, 1995, the following cumulative Joint Venture Partner contributions and allocations had been made since inception of the Joint Venture:
F. Related Party Transactions
Commencing with the date of acquisition of Brookwood Village, the Joint Venture entered into agreements under which property management fees are paid to an affiliate of the Joint Venture Partners for services as management agent. Such agreements provide for management fees payable monthly at the rate of up to 6% of the gross receipts net of leasing commissions. The Joint Venture also reimburses affiliates of the Joint
Venture Partners for certain expenses incurred in connection with the operation of Brookwood Village including accounting, computer, insurance, travel, legal and payroll.
Amounts paid to affiliates of the Joint Venture Partners were as follows:
1995 1994 1993
Management Fees $376,424 $356,030 $330,055
Expense Reimbursements 137,455 224,200 223,568
Charged to operations $513,879 $580,230 $553,623
G. Future Base Rents Due Under Commercial Operating Leases
Future base rents due under commercial operating leases in the five years 1996 through 2000 and thereafter are as follows:
1996 $ 4,074,300 1997 3,706,900 1998 3,375,200 1999 3,048,200 2000 2,450,400 Thereafter 12,965,116
H. Federal Income Taxes
The reconciliation of the income for each year reported in the accompanying statement of operations with the income reported in the Joint Venture's 1995, 1994 and 1993 federal income tax return follows:
The allocation of the 1995 net income for federal income tax purposes is as follows:
Passive Portfolio Income Income Total
Krupp Cash Plus-II Limited Partnership $1,194,268 $25,328 $1,219,596
Texas Apartments Limited Partnership 1,111,225 25,328 1,136,553
$2,305,493 $50,656 $2,356,149
Passive income differs due to individual Joint Venture Partner depreciation elections.
BROOKWOOD VILLAGE JOINT VENTURE
SCHEDULE III- REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 1995
(a) The Partnership uses the cost basis for property valuation for both income tax and financial statement purposes. The Partnership holds title to its properties free and clear from all mortgage indebtedness or other material liens or encumbrances. The aggregate cost for federal income tax purposes at December 31, 1995 is $47,590,141.
Continued
BROOKWOOD VILLAGE JOINT VENTURE
SCHEDULE III- REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued December 31, 1995
Reconciliation of Real Estate and Accumulated Depreciation for each of the three years in the period ended December 31, 1995: