| MICHIGAN | 38-2702802 | |
| (State or other jurisdiction of | (I.R.S. employer | |
| incorporation or organization) | identification number) |
Securities registered pursuant to Section 12(g) of the Act: units of beneficial assignments of limited partnership interest Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
| Balance Sheets | ||
| June 30, 2001 (Unaudited) and | ||
| December 31, 2000 | 3
| |
| Statements of Income | ||
| Six months ended June 30, 2001 and 2000 | ||
| Three months ended June 30, 2001and 2000 (Unaudited) | 4
| |
| Statement of Partners Equity | ||
| Six months ended June 30, 2001(Unaudited) | 4
| |
| Statements of Cash Flows | ||
| Six months ended June 30, 2001 | ||
| and 2000 (Unaudited) | 5
| |
| Notes to Financial Statements | ||
| June 30, 2001 (Unaudited) | 6 |
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS 7
ITEM 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK 10
PART II OTHER INFORMATION 10
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 10
1. Basis of Presentation:
The accompanying unaudited 2001 financial statements have been prepared in accordance with generally
accepted accounting principles for interim financial information and with the instructions to Form 10-Q
and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. The balance sheet at December 31, 2000 has been derived from the
audited financial statements at that date. Operating results for the six months ended June 30, 2001 are
not necessarily indicative of the results that may be expected for the year ending December 31, 2001, or
for any other interim period. For further information, refer to the consolidated financial statements
and footnotes thereto included in the Partnership's Form 10-K for the year ending December 31, 2000.
ITEM 2.
Capital Resources
The Partnership's capital resources consist primarily of its nine manufactured home communities. On August 20, 1998, the Partnership refinanced seven of its nine properties with GMAC Commercial Mortgage Corporation (the "Refinancing").
Liquidity
As a result of the Refinancing, seven of the Partnership's nine properties are mortgaged. At the time of the Refinancing, the aggregate principal amount due under the seven mortgage notes was $30,000,000 and the aggregate fair market value of the Partnership's mortgaged properties was $66,000,000. The Partnership expects to meet its short-term liquidity needs generally through its working capital provided by operating activities.
Partnership liquidity is based, in part, upon its investment strategy. Upon acquisition, the Partnership anticipated owning the properties for seven to ten years. All of the properties have been owned by the Partnership for more than ten years. The General Partner may elect to have the Partnership own the properties for as long as, in the opinion of the General Partner, it is in the best interest of the Partnership to do so.
Net Cash from Operations totaled $928,277 and $883,294 for the quarters ended June 30, 2001 and 2000, respectively. Net Cash from Operations is defined as net income computed in accordance with generally accepted accounting principals ("GAAP"), plus real estate related depreciation and amortization. Net Cash from Operations does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs. Net Cash from Operations should not be considered as an alternative to net income as the primary indicator of the Partnership's operating performance nor as an alternative to cash flow as a measure of liquidity. From Net Cash from Operations the General Partner has decided to distribute $693,711, or $.21 per unit, to the unit holders during the quarter ending June 30, 2001. The General Partner will continue to monitor cash flow generated by the Partnership's nine properties during the coming quarters. If cash flow generated is greater or lesser than the amount needed to maintain the current distribution level, the General Partner may elect to reduce or increase the level of future distributions paid to Unit Holders.
While the Partnership is not required to maintain a working capital reserve, the Partnership has not distributed all the Distributable Cash from Operations in order to build reserves. As of June 30, 2001, the Partnership's cash reserves amounted to $3.8 million.
Results of Operations
Overall, as illustrated in the following table, the Partnership's nine properties reported combined occupancy of 89% (2,948/3,329 sites) at the end of June 2001, versus 92% (3,068/3,329) for June 2000. The average monthly homesite rent as of June 30, 2001 was approximately $370, versus $359, an increase of 3% from June 2000.
| Total Capacity | Occupied Sites | Occupancy Rate | Average* Rent Ardmor Village | 339 | 335 | 99% | $351
| Camelot Manor | 335 | 304 | 91% | 348
| Country Roads | 311 | 262 | 84% | 251
| Dutch Hills | 278 | 273 | 98% | 346
| El Adobe | 367 | 311 | 85% | 424
| Paradise Village | 614 | 455 | 73% | 315
| Stonegate Manor | 308 | 281 | 91% | 352
| Sunshine Village | 356 | 330 | 93% | 462
| West Valley | 421 | 397 | 94% | 479
| Total on 6/30/01: | 3,329 | 2,948 | 89% | $370
| Total on 6/30/00: | 3,329 | 3,068 | 92% | $359
| |
Gross Revenues Net Income
6/30/01 6/30/00 6/30/01 6/30/00
Ardmor Village $371,432 $306,933 $210,288 $199,567
Camelot Manor 297,570 296,909 141,586 130,799
Country Roads 197,286 240,775 21,830 (7,346)
Dutch Hills 256,229 260,766 117,344 121,808
El Adobe 393,503 428,028 230,487 280,748
Paradise Village 423,274 419,436 131,902 78,465
Stonegate Manor 275,455 284,993 138,991 160,597
Sunshine Village 437,457 411,346 261,717 242,758
West Valley 566,552 560,910 345,477 367,804
3,218,758 3,210,096 1,599,622 1,575,200
Partnership Management: 32,970 41,352 (62,663) (103,875)
Other Non Recurring expenses:----- ---- (139,174) (108,593)
Debt Service (469,508) (479,438)
Depreciation and Amortization----- ---- (431,250) (480,811)
$3,251,728 $3,251,448 $497,027 $402,483
Comparison of Six Months and Quarter Ended June 30, 2001 to Six Months and Quarter Ended June 30, 2000
Gross revenues for the first six months of 2001 increased slightly, $6,543,775 as compared to $6,495,053 for the same six months of 2000. Gross revenues for the quarter increased $280 to $3,251,728 in 2001, as compared to $3,251,448 the same three months 2000.
These increases are due to higher site rental fees. (See table in previous section.)
As described in the Statements of Income, Total Operating Expenses for the first six months of 2001 were $5,390,080 a 1.6% decrease for $5,477,573 for the same six months of 2000. Total Operating Expenses for the three months ended June decreased $94,264, or 3.3%, to $2,754,701 in 2001, as compared to $2,848,965 in 2000.
As a result of the aforementioned factors, Net Income increased to $1,153,695, compared to $1,017,480 in2000, $497,027 for the second quarter of 2001 compared to $402,483 for the second quarter of 2000, a 23% increase.
ITEM 3.
The Partnership is exposed to interest rate rise primarily through its borrowing activities. There is inherent roll over risk for borrowings as they mature and are renewed at current market rates. The extent of this risk is not quantifiable or predictable because of the variability of future interest rates and the Partnership's future financing requirements.
Note Payable: At June 30, 2001 the Partnership had a note payable outstanding in the amount of $29,014,140. Interest on this note is at a fixed annual rate of 6.37% through March 2009.
The Partnership does not enter into financial instruments transactions for trading or other speculative purposes or to manage its interest rate exposure
ITEM 6. Reports on Form 8-K
(a) Reports on Form 8-K
There were no reports filed on Form 8-K during
the three months ended June 30, 2001.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Uniprop Manufactured Housing Communities
Income Fund II, a Michigan Limited Partnership
BY: Genesis Associates Limited Partnership,
General Partner
BY: Uniprop, Inc.,
its Managing General Partner
By: /s/ Paul M. Zlotoff
Paul M. Zlotoff, President
By: /s/ Gloria A. Koster
Gloria A. Koster, Principal Financial Officer
Dated: August 10, 2001