UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 28, 2006
-------------------------
Commission File Number: | 0-8952 |
SB PARTNERS | ||
(Exact name of registrant as specified in its charter) | ||
New York | 13-6294787 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) | |
1251 Avenue of the Americas, N.Y., N.Y. | 10020 | |
(Address of principal executive offices) | (Zip Code) |
(212) 408-5000 |
(Registrant's telephone number, including area code) |
(Former name, former address and former fiscal year, if changed since last report.) |
Item 7. Financial Statements
The following unaudited and pro forma financial information is included as amendments to the Forms 8-K filed on December 4, 2006 and January 3, 2007. |
In assessing the acquisition of 175 Ambassador Drive, a 331,089 square foot industrial building located in Naperville, Illinois, the Registrant considered historical and estimates of future cash flows, physical condition, location, the competitive nature of the market, and the existing tenant. Furthermore, anticipated maintenance and repair costs and capital improvement requirements were evaluated. An expansion of the property of approximately 89,000 square feet, which approximates a 37% increase of square footage, was completed recently, before the acquisition of the property, and due to which, rental income is increasing approximately 29%. After reasonable inquiry, the Registrant is not aware of any other material factors that would cause the reported financial information in the accompanying Statement of Revenue and Certain Expenses not to be indicative of future operating results, although no assurance can be given that the historical financial information will be representative of future results.
Due to the completion of the expansion and the increase in rental income we are not presenting a Statement of Revenue and Certain Expenses for 2005 as it would not be indicative of future results.
2
The following pro forma consolidated financial statements reflect the acquisition and financing of 175 Ambassador Drive by the Registrant on November 28, 2006. As the Registrant assumed the seller’s existing mortgage note with a balance of $7,107,318 secured by the property, the consolidated balance sheet as of the last filing, September 30, 2006, has been adjusted to reflect the inclusion of the assets and liabilities of the newly acquired commercial property, as well as the assumed mortgage note, as if the acquisition and financing had occurred at the end of the period. The consolidated statement of operations for the nine months ended September 30, 2006 and for the year ended December 31, 2005 has been restated to reflect the results of operations of the Registrant as if the acquisition and financing had been consummated at the beginning of the periods presented.
In addition, the following pro forma financial statements reflect the sale of Halton Place Apartments by the Registrant on December 20, 2006. The balance sheet as of the last filing, September 30, 2006, has been adjusted to reflect the removal of the assets and liabilities of this property as if the sale had been consummated on the balance sheet date. The statement of operations for the nine months ended September 30, 2006 and for the year ended December 31, 2005 has been adjusted to reflect the results of operations of the Registrant as if the sale had been consummated at the beginning of the periods presented.
Furthermore, the consolidated statement of operations for the nine months ended September 30, 2006 and the year ended December 31, 2005 have been restated to reflect the results of the operations of the Registrant as if the real estate sale of Holiday Park Apartments and the unimproved land on May 2, 2006 had taken place at the beginning of the periods presented. Lastly, the consolidated statement of operations for the year ended December 31, 2005 has been restated to reflect the results of the operations of Cypress Key, which was sold on March 28, 2005, 435 Park Court, which was acquired on October 5, 2005, and Waterview Apartments, which was sold on December 22, 2005, as if these transactions had taken place at the beginning of the year. The Registrant is reflecting these transactions in accordance with the rules and regulations regarding the filing of Form 8-K, as the transactions were consummated during the fiscal periods presented. Please refer to the Forms 8-K filed May 12, 2006, January 6, 2006, March 7, 2006, as amended, October 18, 2005, December 19, 2005, as amended, and May 21, 2005 filed in connection with these transactions.
3
SB PARTNERS | |
FORM 8-K/A | |
INDEX TO FINANCIAL STATEMENTS | |
Statement of Revenue and Certain Expenses for the nine months ended September 30, 2006 (Unaudited) | 4 |
Notes to Statement of Revenue and Certain Expenses (Unaudited) | 5 |
Pro Forma Consolidated Balance Sheet as of September 30, 2006 (Unaudited) | 6 |
Pro Forma Consolidated Statement of Operations for the nine months ended September 30, 2006 (Unaudited) | 7 |
Pro Forma Consolidated Statement of Operations For the year ended December 31, 2006 | 8-9 |
Notes to Pro Forma Consolidated Financial Statements (Unaudited) | 10-12 |
4
175 AMBASSADOR DRIVE | ||||
STATEMENT OF REVENUE AND CERTAIN EXPENSES | ||||
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2006 | ||||
(UNAUDITED) | ||||
REVENUE: | ||||
Rent income | $ | 730,867 | ||
Expense reimbursements | 12,870 | |||
Total Revenue | 743,737 | |||
EXPENSE: | ||||
Real estate operating expenses | 22,635 | |||
General and administrative expenses | 14,199 | |||
Total Expenses | 36,834 | |||
REVENUE IN EXCESS OF CERTAIN EXPENSES | $ | 706,903 | ||
The accompanying notes are an integral part of this financial statement. |
5
175 AMBASSADOR DRIVE
NOTES TO STATEMENT OF REVENUE AND CERTAIN EXPENSES
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005
(UNAUDITED)
1. | BASIS OF PRESENTATION |
The accompanying Statement of Revenue and Certain Expenses relates to the operations of 175 Ambassador Court, a 331,089 square foot commercial property located in Naperville, Illinois.
The accompanying financial statement has been prepared for the purpose of complying with Rule 3-14 of Regulation S-X of the Securities and Exchange Commission and thus excludes certain expenses, such as depreciation and amortization, not related to the future operations of the property. Management is not aware of any material factors, other than discussed on the first page of this form, relating to the property, which would cause the reported financial information not to be indicative of future operating results.
2. | SIGNIFICANT ACCOUNTING POLICIES |
The accompanying Statement of Revenue and Certain Expenses was prepared using the accrual basis of accounting in accordance with generally accepted accounting principles. Rental income is recognized on a straight-line basis over the term of the lease. The preparation of financial statements in conformity with generally accepted accounting principles requires the use of certain estimates in determining the reported amounts of revenues and expenses. Actual results could differ from those estimates.
6
SB PARTNERS | |||||||||||||
(a New York limited partnership) | |||||||||||||
PRO FORMA BALANCE SHEET | |||||||||||||
As of September 30, 2006 | |||||||||||||
(UNAUDITED) | |||||||||||||
PRO FORMA ADJUSTMENTS | |||||||||||||
(SEE NOTE 2) | |||||||||||||
PURCHASE OF | SALE OF | PRO FORMA | |||||||||||
175 AMBASSADOR | HALTON PLACE | BALANCE | |||||||||||
AS REPORTED | DRIVE | APARTMENTS | SHEET | ||||||||||
Assets: | |||||||||||||
Investments - | |||||||||||||
Real Estate, at cost | |||||||||||||
Land | $ | 1,985,000 | $ | 2,080,000 | $ | - | $ | 4,065,000 | |||||
Buildings, furnishings and improvements | 18,166,996 | 18,851,261 | - | 37,018,257 | |||||||||
Less - accumulated depreciation | (833,139 | ) | - | - | (833,139 | ) | |||||||
19,318,857 | 20,931,261 | - | 40,250,118 | ||||||||||
Real estate held for sale | 24,306,834 | - | (11,809,151 | ) | 12,497,683 | ||||||||
Investment in joint venture | 16,411 | - | - | 16,411 | |||||||||
43,642,102 | 20,931,261 | (11,809,151 | ) | 52,764,212 | |||||||||
Other Assets - | |||||||||||||
Cash and cash equivalents | 15,373,985 | (13,066,654 | ) | 12,249,967 | 14,557,298 | ||||||||
Other assets | 300,038 | 71,073 | - | 371,111 | |||||||||
Other assets in discontinued operations | 240,891 | - | (31,539 | ) | 209,352 | ||||||||
Total assets | $ | 59,557,016 | $ | 7,935,680 | $ | 409,277 | $ | 67,901,973 | |||||
Liabilities: | |||||||||||||
Mortgage notes payable | $ | 10,000,000 | $ | 7,107,319 | $ | - | $ | 17,107,319 | |||||
Accounts payable and accrued expenses | 259,338 | 758,420 | - | 1,017,758 | |||||||||
Tenant security deposits | 78,366 | - | - | 78,366 | |||||||||
Deferred revenue | 69,941 | 69,941 | |||||||||||
Other liabilities in discontinued operations, including | |||||||||||||
$9,514,934 of mortgage notes payable | 9,940,961 | - | (166,858 | ) | 9,774,103 | ||||||||
Total liabilities | 20,278,665 | 7,935,680 | (166,858 | ) | 28,047,487 | ||||||||
Partners' Capital: | |||||||||||||
Units of partnership interest without par value; | |||||||||||||
Limited partners - 7,753 units | 39,291,719 | - | 576,061 | 39,867,780 | |||||||||
General partner - 1 unit | (13,368 | ) | - | 74 | (13,294 | ) | |||||||
Total partners' capital | 39,278,351 | - | 576,135 | 39,854,486 | |||||||||
Total liabilities & partners' capital | $ | 59,557,016 | $ | 7,935,680 | $ | 409,277 | $ | 67,901,973 | |||||
See accompanying notes to pro forma consolidated financial statements. | |||||||||||||
7
SB PARTNERS | ||||||||||||||||
(a New York limited partnership) | ||||||||||||||||
PRO FORMA STATEMENT OF OPERATIONS | ||||||||||||||||
For the Nine Months Ended September 30, 2006 | ||||||||||||||||
(UNAUDITED) | ||||||||||||||||
PRO FORMA ADJUSTMENTS | ||||||||||||||||
(SEE NOTE 2) | ||||||||||||||||
PURCHASE OF | SALE OF | SALE OF | RESTATED | |||||||||||||
AS | 175 AMBASSADOR | HOLIDAY PARK | HALTON PLACE | INCOME | ||||||||||||
REPORTED | DRIVE | APARTMENTS | APARTMENTS | STATEMENT | ||||||||||||
Revenues: | ||||||||||||||||
Rental income | $ | 1,299,603 | $ | 730,867 | $ | - | $ | - | $ | 2,030,470 | ||||||
Other | 582,956 | 12,870 | - | - | 595,826 | |||||||||||
Interest on short-term investments | 371,514 | - | - | - | 371,514 | |||||||||||
Total revenues | 2,254,073 | 743,737 | - | - | 2,997,810 | |||||||||||
Expenses: | ||||||||||||||||
Real estate operating expenses | 394,252 | 36,834 | - | - | 431,086 | |||||||||||
Interest on mortgage notes payable | 483,333 | 310,895 | - | - | 794,228 | |||||||||||
Depreciation and amortization | 351,447 | 57,917 | - | - | 409,364 | |||||||||||
Real estate taxes | 370,739 | - | - | - | 370,739 | |||||||||||
Management fees | 532,267 | 208,696 | (43,491 | ) | (201,190 | ) | 496,282 | |||||||||
Other | 20,472 | - | - | - | 20,472 | |||||||||||
Total expenses | 2,152,510 | 614,342 | (43,491 | ) | (201,190 | ) | 2,522,171 | |||||||||
Income from operations | 101,563 | 129,395 | 43,491 | 201,190 | 475,639 | |||||||||||
Equity in net loss of joint venture | (18,389 | ) | - | - | - | (18,389 | ) | |||||||||
Income from continuing operations | 83,174 | 129,395 | 43,491 | 201,190 | 457,250 | |||||||||||
Income (loss) from discontinuing operations | 532,193 | - | (9,482 | ) | (430,619 | ) | 92,092 | |||||||||
Net gain (loss) on sale of investment in real estate | 11,770,108 | - | (11,770,108 | ) | - | - | ||||||||||
Net income (loss) | 12,385,475 | 129,395 | (11,736,099 | ) | (229,429 | ) | 549,342 | |||||||||
Income (loss) allocated to general partner | 1,598 | 17 | (1,514 | ) | (30 | ) | 71 | |||||||||
Income (loss) allocated to limited partners | $ | 12,383,877 | $ | 129,378 | $ | (11,734,585 | ) | $ | (229,399 | ) | $ | 549,271 | ||||
Earnings per unit of limited partnership interest | ||||||||||||||||
(basic and diluted) | ||||||||||||||||
Continuing operations | $ | 11 | $ | 17 | $ | 6 | $ | 26 | $ | 59 | ||||||
Discontinued operations (including gain on sale) | $ | 1,587 | $ | - | $ | (1,519 | ) | $ | (56 | ) | $ | 12 | ||||
Net income (loss) | $ | 1,598 | $ | 17 | $ | (1,514 | ) | $ | (30 | ) | $ | 71 | ||||
Weghted Average Number of Units of Limited | ||||||||||||||||
Partnership Interest Outstanding | 7,753 | 7,753 | 7,753 | 7,753 | 7,753 | |||||||||||
See accompanying notes to pro forma consolidated financial statements. |
8
SB PARTNERS | ||||||||||||||||
(a New York limited partnership) | ||||||||||||||||
PRO FORMA STATEMENT OF OPERATIONS | ||||||||||||||||
For the Year Ended December 31, 2005 | ||||||||||||||||
(UNAUDITED) | ||||||||||||||||
PRO FORMA ADJUSTMENTS | ||||||||||||||||
(SEE NOTE 2) | ||||||||||||||||
SALE OF | PURCHASE | SALE OF | ||||||||||||||
AS | WATERVIEW | OF 435 PARK | CYPRESS KEY | |||||||||||||
REPORTED | APARTMENTS | COURT | APARTMENTS | SUBTOTAL | ||||||||||||
Revenues: | ||||||||||||||||
Rental income | $ | 4,128,833 | $ | - | $ | 874,152 | $ | - | $ | 5,002,985 | ||||||
Other | 420,996 | - | 6,093 | - | 427,089 | |||||||||||
Interest on short-term investments | 87,301 | - | - | - | 87,301 | |||||||||||
Total revenues | 4,637,130 | - | 880,245 | - | 5,517,375 | |||||||||||
Expenses: | ||||||||||||||||
Real estate operating expenses | 1,929,328 | (391 | ) | 50,544 | - | 1,979,481 | ||||||||||
Interest on mortgage notes payable | 942,510 | - | 313,606 | - | 1,256,116 | |||||||||||
Depreciation and amortization | 1,045,232 | - | 288,204 | - | 1,333,436 | |||||||||||
Real estate taxes | 452,284 | - | 23,670 | - | 475,954 | |||||||||||
Management fees | 687,210 | (73,933 | ) | 106,025 | (75,205 | ) | 644,097 | |||||||||
Other | 307,291 | (14,075 | ) | 311 | - | 293,527 | ||||||||||
Total expenses | 5,363,855 | (88,399 | ) | 782,360 | (75,205 | ) | 5,982,611 | |||||||||
(Loss) income from operations | (726,725 | ) | 88,399 | 97,885 | 75,205 | (465,236 | ) | |||||||||
Equity in net income (loss) of joint venture | 3,342,104 | (3,342,104 | ) | - | - | - | ||||||||||
Income (loss) from continuing operations | 2,615,379 | (3,253,705 | ) | 97,885 | 75,205 | (465,236 | ) | |||||||||
(Loss) income from discontinuing operations | (1,316,254 | ) | - | - | 1,613,006 | 296,752 | ||||||||||
Net gain on sale of investment in real estate | 6,350,771 | - | - | (6,350,771 | ) | - | ||||||||||
Net income (loss) | 7,649,896 | (3,253,705 | ) | 97,885 | (4,662,560 | ) | (168,484 | ) | ||||||||
Income (loss) allocated to general partner | 987 | (420 | ) | 13 | (602 | ) | (22 | ) | ||||||||
Income (loss) allocated to limited partners | $ | 7,648,909 | $ | (3,253,285 | ) | $ | 97,872 | $ | (4,661,958 | ) | $ | (168,462 | ) | |||
Earnings per unit of limited partnership interest | ||||||||||||||||
(basic and diluted) | ||||||||||||||||
Continuing operations | $ | 337 | $ | (420 | ) | $ | 13 | $ | 10 | $ | (60 | ) | ||||
Discontinued operations (including gain on sale) | $ | 650 | $ | - | $ | - | $ | (612 | ) | $ | 38 | |||||
Net income (loss) | $ | 987 | $ | (420 | ) | $ | 13 | $ | (602 | ) | $ | (22 | ) | |||
Weghted Average Number of Units of Limited | ||||||||||||||||
Partnership Interest Outstanding | 7,753 | 7,753 | 7,753 | 7,753 | 7,753 | |||||||||||
See accompanying notes to pro forma consolidated financial statements. |
9
SB PARTNERS | ||||||||||||||||
(a New York limited partnership) | ||||||||||||||||
PRO FORMA STATEMENT OF OPERATIONS (continued) | ||||||||||||||||
For the Year Ended December 31, 2005 | ||||||||||||||||
(UNAUDITED) | ||||||||||||||||
PRO FORMA ADJUSTMENTS | ||||||||||||||||
(SEE NOTE 2) | ||||||||||||||||
SUBTOTAL | SALE OF | PURCHASE OF | SALE OF | RESTATED | ||||||||||||
FROM PRIOR | HOLIDAY PARK | 175 AMBASSADOR | HALTON PLACE | INCOME | ||||||||||||
PAGE | APARTMENTS | DRIVE | APARTMENTS | STATEMENT | ||||||||||||
Revenues: | ||||||||||||||||
Rental income | $ | 5,002,985 | $ | - | $ | 875,139 | $ | (1,531,167 | ) | $ | 4,346,957 | |||||
Other | 427,089 | - | 30,910 | (52,946 | ) | 405,053 | ||||||||||
Interest on short-term investments | 87,301 | - | - | (145 | ) | 87,156 | ||||||||||
Total revenues | 5,517,375 | - | 906,049 | (1,584,258 | ) | 4,839,166 | ||||||||||
Expenses: | ||||||||||||||||
Real estate operating expenses | 1,979,481 | - | 47,014 | (762,444 | ) | 1,264,051 | ||||||||||
Interest on mortgage notes payable | 1,256,116 | - | 421,506 | (89,105 | ) | 1,588,517 | ||||||||||
Depreciation and amortization | 1,333,436 | - | 500,640 | (425,625 | ) | 1,408,451 | ||||||||||
Real estate taxes | 475,954 | - | - | (135,452 | ) | 340,502 | ||||||||||
Management fees | 644,097 | (91,353 | ) | 278,562 | (246,698 | ) | 584,608 | |||||||||
Other | 293,527 | - | - | (7,064 | ) | 286,463 | ||||||||||
Total expenses | 5,982,611 | (91,353 | ) | 1,247,722 | (1,666,388 | ) | 5,472,592 | |||||||||
(Loss) income from operations | (465,236 | ) | 91,353 | (341,673 | ) | 82,130 | (633,426 | ) | ||||||||
Equity in net income (loss) of joint venture | - | - | - | - | - | |||||||||||
Income (loss) from continuing operations | (465,236 | ) | 91,353 | (341,673 | ) | 82,130 | (633,426 | ) | ||||||||
(Loss) income from discontinuing operations | 296,752 | (296,752 | ) | - | - | - | ||||||||||
Net gain on sale of investment in real estate | - | - | - | - | - | |||||||||||
Net income (loss) | (168,484 | ) | (205,399 | ) | (341,673 | ) | 82,130 | (633,426 | ) | |||||||
Income (loss) allocated to general partner | (22 | ) | (26 | ) | (44 | ) | 11 | (81 | ) | |||||||
Income (loss) allocated to limited partners | $ | (168,462 | ) | $ | (205,373 | ) | $ | (341,629 | ) | $ | 82,119 | $ | (633,345 | ) | ||
Earnings per unit of limited partnership interest | ||||||||||||||||
(basic and diluted) | ||||||||||||||||
Continuing operations | $ | (60 | ) | $ | 12 | $ | (44 | ) | $ | 11 | $ | (81 | ) | |||
Discontinued operations (including gain on sale) | $ | 38 | $ | (38 | ) | $ | - | $ | - | $ | (0 | ) | ||||
Net income (loss) | $ | (22 | ) | $ | (26 | ) | $ | (44 | ) | $ | 11 | $ | (81 | ) | ||
Weghted Average Number of Units of Limited | ||||||||||||||||
Partnership Interest Outstanding | 7,753 | 7,753 | 7,753 | 7,753 | 7,753 | |||||||||||
See accompanying notes to pro forma consolidated financial statements. |
10
SB PARTNERS
(a New York limited partnership)
NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(1) Accounting and Financial Reporting
The consolidated financial statements included herein are unaudited; however, the information reflects all adjustments (consisting solely of normal recurring
adjustments) that are, in the opinion of management, necessary to a fair presentation of the financial position and results of operations for the year presented. Certain
information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although the Registrant believes that the disclosures are adequate to make the information presented not
misleading. It is suggested that these financial statements be read in conjunction with the financial statements and the notes thereto included in the Registrant's latest
annual report on Form 10-K, and Forms 8-K filed May 12, 2006, January 6, 2006, March 7, 2006, as amended, October 18, 2005, December 19, 2005, as amended, and
May 21, 2005 filed in connection with these transactions.
(2) Pro Forma Adjustments
The consolidated balance sheet as of the last filing date, September 30, 2006, has been restated to reflect the addition of the assets and liabilities related
to 175 Ambassador Drive, and the assumed mortgage note payable, as if the transactions had occurred on such date. The total costs to acquire 175 Ambassador Drive,
$20,931,261, have been added to the Registrant’s portfolio of investments in real estate properties. The mortgage assumption fee of $71,073 has been added to other
assets. Liabilities assumed at the time of the purchase, accrued expenses of $758,420 and deferred revenue of $69,941 have been added to the Registrant’s total
liabilities. The amount of the mortgage assumed, $7,107,319, which is secured by the property has been added to the total of the Registrant’s mortgage notes payable.
Cash held by the Registrant has been decreased by $13,066,654, the amount of cash paid by the Registrant at closing for the acquisition of 175 Ambassador Drive.
Additionally, the consolidated balance sheet as of the last filing date, September 30, 2006, has been restated to reflect the sale of Halton Place Apartments on
December 20, 2006, as if the transactions had occurred on such date. Accordingly, the assets and liabilities of Halton Place Apartments have been removed from the
historical balance sheet to reflect the sale of the property. Assets removed included real estate held for sale of $11,809,151 and other assets in discontinued operations
totaling $31,539. Liabilities removed include other liabilities in discontinued operations totaling $166,858. In addition, the balance of cash has been increased by
$12,249,967 to reflect the proceeds from the sale of Halton Place Apartments.
The accompanying pro forma consolidated statement of operations for the nine months ended September 30, 2006 has been adjusted to reflect the results
of operations of the Registrant as if the acquisition and financing of 175 Ambassador Drive and the sale of Halton Place Apartments had been consummated at the
beginning of the period. Additionally, the consolidated statement of operations for the nine months ended September 30, 2006 has been restated to reflect the results of
operations of the Registrant as if the sale of Holiday Park and the unimproved land on May 2, 2006 had taken place at the beginning of the period. The Registrant is
reflecting these transactions in accordance with the rules and regulations regarding the filing of Form 8-K, as the transactions were consummated during the fiscal
period presented.
11
The items of income of 175 Ambassador Drive that have been added to the consolidated statement of operations for the nine months ended September 30,
2006 include rental and other income received from the tenant. All expenses relating to the property including real estate operating expenses, interest on mortgage notes
payable, depreciation, and other expenses have also been included. Management fees have been adjusted to reflect the investment in the property.
The income from discontinuing operations of Halton Place Apartments has been removed from the consolidated statement of operations for the nine months
ended September 30, 2006. Also, management fees have been reduced to reflect the sale of the property. In accordance with the rules and regulations regarding the
filing of Form 8-K, no gain from the sale of the investment in real estate property is reflected in the pro forma statement of operations.
The income from discontinuing operations of Holiday Park Apartments has been removed from the consolidated statement of operations for the nine months
ended September 30, 2006. Also, management fees have been reduced to reflect the sale of the property. In accordance with the rules and regulations regarding the
filing of Form 8-K, no gain from the sale of the investment in real estate property is reflected in the pro forma statement of operations.
The accompanying pro forma consolidated statement of operations for the year ended December 31, 2005 has been adjusted to reflect the results of
operations of the Registrant as if the acquisition and financing of 175 Ambassador Drive and the sale of Halton Place Apartments had been consummated at the
beginning of the year. Additionally, the consolidated statement of operations for the year ended December 31, 2005 has been restated to reflect the results of
operations of the Registrant as if the sale of Cypress Key Apartments on March 28, 2005, the acquisition and financing of 435 Park Court on October 5, 2005, the sale
of Waterview Apartments on December 22, 2005 and the sale of Holiday Park on May 2, 2006 had taken place at the beginning of the year. The Registrant is reflecting
these transactions in accordance with the rules and regulations regarding the filing of Form 8-K, as the transactions were consummated during the fiscal period
presented.
The items of income of 175 Ambassador Drive that have been added to the consolidated statement of operations for the year ended December 31, 2005
include rental and other income received from the tenant. All expenses relating to the property including real estate operating expenses, interest on mortgage notes
payable, depreciation, and other expenses have also been included. Management fees have been adjusted to reflect the investment in the property, net of the proceeds
of the mortgage note.
The items of income of Halton Place Apartments that have been removed from the consolidated statement of operations for the year ended December 31,
2005 include rental and other income received from the tenant. All expenses relating to the property including real estate operating expenses, interest on mortgage notes
payable, taxes, depreciation, and other expenses have also been removed. Also, management fees have been reduced to reflect the sale of the property. In accordance
with the rules and regulations regarding the filing of Form 8-K, no gain from the sale of the investment in real estate property is reflected in the pro forma statement of
operations.
The loss from discontinuing operations of Holiday Park Apartments has been removed from the consolidated statement of operations for the year ended
December 31, 2005. Also, management fees have been reduced to reflect the sale of the property. In accordance with the rules and regulations regarding the filing of
Form 8-K, no gain from the sale of the investment in real estate property is reflected in the pro forma statement of operations.
The equity income in joint venture of Waterview Apartments has been removed from the consolidated statement of operations for the year ended
December 31, 2005. Furthermore, management fees have been reduced to reflect the sale of the property. In accordance with the rules and regulations regarding the
filing of Form 8-K, no gain from the sale of the investment in real estate property is reflected in the pro forma statement of operations.
12
The items of income of 435 Park Court that have been added to the consolidated statement of operations for the year ended December 31, 2005 include
rental and other income received from the tenant. All expenses relating to the property including real estate operating expenses, interest on mortgage notes payable,
taxes, depreciation, and other expenses have also been included. Management fees have been adjusted to reflect the investment in the property, net of the proceeds of
the mortgage note.
The loss from discontinuing operations of Cypress Key Apartments has been removed from the consolidated statement of operations for the year ended
December 31, 2005. Also, management fees have been reduced to reflect the sale of the property. In accordance with the rules and regulations regarding the filing of
Form 8-K, no gain from the sale of the investment in real estate property is reflected in the pro forma statement of operations.
13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SB PARTNERS | ||
(Registrant) | ||
By: | SB PARTNERS REAL ESTATE CORPORATION | |
General Partner | ||
Principal Financial & Accounting Officer | ||
Dated: January 30, 2007 | By: | /s/ George N. Tietjen III |
George N. Tietjen III | ||
Chief Financial Officer & Treasurer | ||