Attached files
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| 8-K - FORM 8-K - Behringer Harvard Short-Term Liquidating Trust | v236158_8k.htm |
Second Quarter Report
Quarter ended June 30, 2011
Behringer Harvard Short-Term Opportunity Fund I LP
Hotel Palomar and Residences in Dallas, TX, (left & center) and 1221 Coit Road in Dallas, TX (right), are assets of Behringer Harvard Short-Term Opportunity Fund I LP.
Second Quarter Overview
As of September 21, 2011
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·
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The Fund is in its asset disposition phase. In the near term, liquidity generated from asset sales and other sources will be used to continue to invest in current portfolio properties, reduce outstanding debt as required by the lenders, and to fund operations, with the objective of returning excess cash to investors as soon as possible. Our ongoing focus is to preserve capital, sustain and enhance property values, and reduce operating expenses. We are also evaluating the potential benefits of converting into a liquidating trust.
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·
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We are continuing discussions with the lender to restructure the matured loan on 5050 Quorum.
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1221 Coit Road is fully leased to Internap Network Services Corporation through 2022. We are seeking new financing to repay the current lender and to fund tenant improvements and leasing commissions. Internap has an option through June 2012 to purchase this property at a price significantly higher than the Fund’s carrying value. If they do not exercise this option, we plan to broadly market this property for sale.
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·
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At 250/290 E. John Carpenter Freeway, we amended the sales contract to provide contingent profit interests that could benefit the Fund under certain circumstances, and adjusted the contracted sales price to $18.8 million from approximately $27.0 million. This sale is expected to close in late September or October. We plan to use the sales proceeds to pay off our line of credit and repay a portion of the Hotel Palomar loan.
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At the Hotel Palomar and Residences, the hotel’s operating performance is improving as the hospitality sector gradually recovers. The Residences’ recently restarted condominium sales campaign has already generated three sales, with three more units under contract to sell.
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We sold Landmark I and II on June 30 for $16.25 million. The sales proceeds were used to fully satisfy the existing debt associated with these properties. The Fund retained a back-end promoted interest in distributable cash related to these properties.
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Financial Highlights
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Some numbers
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(in thousands)
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3 mos. ended
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3 mos. ended
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6 mos. ended
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6 mos. ended
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have been
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Jun. 30, 2011
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Jun. 30, 2010
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Jun. 30, 2011
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Jun. 30, 2010
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rounded for
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Total revenues
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$ | 5,375 | $ | 5,976 | $ | 11,396 | $ | 10,955 | |||||||||
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presentation
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Net operating income1
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$ | 218 | $ | 509 | $ | 1,578 | $ | 969 | |||||||||
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purposes.
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As of Jun. 30, 2011
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As of Dec. 31, 2010
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Total assets
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$ | 164,297 | $ | 203,308 | ||||||||||||||
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Total liabilities
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$ | 155,908 | $ | 177,460 | ||||||||||||||
Investor Information
A copy of the Partnership’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission, is available without charge at www.sec.gov or by written request to the Partnership at its corporate headquarters. You may also elect to sign up for electronic delivery by visiting behringerharvard.com and selecting the option to “Go Paperless” at the top of the home page. For additional information about Behringer Harvard and its real estate programs, please contact us at 866.655.3650.
Condensed Consolidated Balance Sheets
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As of
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As of
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Unaudited (in thousands, except unit amounts)
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Jun. 30, 2011
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Dec. 31, 2010
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Assets
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Real estate
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Land
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$ | 21,018 | $ | 29,709 | ||||
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Buildings and improvements, net
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71,363 | 98,415 | ||||||
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Total real estate
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92,381 | 128,124 | ||||||
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Real estate inventory, net
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60,674 | 60,925 | ||||||
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Cash and cash equivalents
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2,038 | 2,040 | ||||||
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Restricted cash
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2,166 | 3,039 | ||||||
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Accounts receivable, net
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3,001 | 3,827 | ||||||
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Prepaid expenses and other assets
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819 | 892 | ||||||
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Furniture, fixtures, and equipment, net
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584 | 1,203 | ||||||
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Deferred financing fees, net
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439 | 683 | ||||||
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Lease intangibles, net
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2,195 | 2,575 | ||||||
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Total assets
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$ | 164,297 | $ | 203,308 | ||||
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Liabilities and Equity
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Liabilities
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Notes payable
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$ | 133,523 | $ | 153,430 | ||||
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Note payable to related party
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12,018 | 11,693 | ||||||
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Accounts payable
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1,045 | 2,801 | ||||||
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Payables to related parties
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2,424 | 2,302 | ||||||
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Accrued liabilities
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6,898 | 7,234 | ||||||
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Total liabilities
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155,908 | 177,460 | ||||||
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Commitments and contingencies
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Equity
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Partners’ capital
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Limited partners—11,000,000 units authorized, 10,803,839 units issued and outstanding at June 30, 2011, and December 31, 2010
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(24,053 | ) | (4,768 | ) | ||||
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General partners
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37,333 | 34,729 | ||||||
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Partners’ capital
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13,280 | 29,961 | ||||||
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Noncontrolling interest
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(4,891 | ) | (4,113 | ) | ||||
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Total equity
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8,389 | 25,848 | ||||||
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Total liabilities and equity
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$ | 164,297 | $ | 203,308 | ||||
This quarterly report summary contains forward-looking statements, including discussion and analysis of the financial condition of Behringer Harvard Short-Term Opportunity Fund I LP (which may be referred to as the “Fund,” the “Partnership,” “we,” “us,” or “our”) and our subsidiaries, our anticipated improvements to, and disposition of, properties, amounts of anticipated cash distributions to our investors in the future, anticipated sales of condominium units, and other matters. These forward-looking statements are not historical facts but are the intent, belief, or current expectations of management based on their knowledge of the business and industry. Words such as “may,” “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Such factors include those described in the Risk Factors section of the Fund’s filings with the Securities and Exchange Commission. We do not undertake to publicly update or revise any forward-looking statements, whether as a result of new information, future event, or otherwise.
Condensed Consolidated Statements of Cash Flows
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6 mos. ended
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6 mos. ended
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Unaudited (in thousands)
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Jun. 30, 2011
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Jun. 30, 2010
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Cash flows from operating activities
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Net loss
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$ | (20,063 | ) | $ | (10,327 | ) | ||
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Adjustments to reconcile net loss to net cash used in operating activities:
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Depreciation and amortization
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3,337 | 3,615 | ||||||
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Asset impairment loss
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18,788 | 2,774 | ||||||
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Inventory valuation adjustment
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- | 1,667 | ||||||
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Gain on troubled debt restructuring
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(4,913 | ) | - | |||||
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Loss on derivative instruments, net
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- | 38 | ||||||
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Changes in operating assets and liabilities:
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Real estate inventory
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(1,930 | ) | (6,967 | ) | ||||
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Accounts receivable
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339 | (170 | ) | |||||
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Prepaid expenses and other assets
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73 | (77 | ) | |||||
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Lease intangibles
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(837 | ) | (48 | ) | ||||
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Accounts payable
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72 | 61 | ||||||
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Accrued liabilities
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248 | (1,194 | ) | |||||
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Payables or receivables with related parties
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122 | 673 | ||||||
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Cash used in operating activities
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(4,764 | ) | (9,955 | ) | ||||
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Cash flows from investing activities
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Proceeds from sale of asset
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16,155 | - | ||||||
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Capital expenditures for real estate
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(254 | ) | (268 | ) | ||||
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Change in restricted cash
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873 | (938 | ) | |||||
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Cash provided by (used in) investing activities
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16,774 | (1,206 | ) | |||||
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Cash flows from financing activities
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Proceeds from notes payable
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1,611 | 7,312 | ||||||
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Proceeds from note payable to related party
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325 | - | ||||||
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Payments on notes payable
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(16,514 | ) | (895 | ) | ||||
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Payments on capital lease obligations
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(36 | ) | (32 | ) | ||||
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Financing costs
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(2 | ) | (12 | ) | ||||
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Contributions from general partners
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2,604 | 4,665 | ||||||
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Cash flows provided by financing activities
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(12,012 | ) | 11,038 | |||||
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Net change in cash and cash equivalents
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(2 | ) | (123 | ) | ||||
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Cash and cash equivalents at beginning of period
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2,040 | 1,964 | ||||||
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Cash and cash equivalents at end of period
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$ | 2,038 | $ | 1,841 | ||||
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Supplemental disclosure
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Interest paid, net of amounts capitalized
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$ | 2,778 | $ | 1,816 | ||||
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Income tax paid
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$ | 178 | $ | 149 | ||||
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Non-cash investing activities
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Note receivable from noncontrolling interest holder
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$ | 197 | $ | 747 | ||||
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Capital expenditures for real estate in accrued liabilities
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$ | 6 | $ | 351 | ||||
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Reclassification of real estate inventory to buildings
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$ | - | $ | 3,842 | ||||
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Non-cash financing activities
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Contributions from noncontrolling interest holder
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$ | 197 | $ | 747 | ||||
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Cancellation of debt through discounted payoff
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$ | 4,845 | $ | - | ||||
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Payments on note payable by third party on accrued liabilities
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$ | - | $ | 302 | ||||
Condensed Consolidated Statements of Operations
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3 mos. ended
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3 mos. ended
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6 mos. ended
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6 mos. ended
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Unaudited (in thousands, except per unit amounts)
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Jun. 30, 2011
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Jun. 30, 2010
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Jun. 30, 2011
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Jun. 30, 2010
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Revenues
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Rental revenue
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$ | 1,669 | $ | 1,880 | $ | 3,613 | $ | 3,739 | ||||||||
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Hotel revenue
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3,381 | 3,266 | 7,458 | 6,386 | ||||||||||||
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Real estate inventory sales
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325 | 830 | 325 | 830 | ||||||||||||
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Total revenues
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5,375 | 5,976 | 11,396 | 10,955 | ||||||||||||
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Expenses
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Property operating expenses
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4,122 | 3,847 | 8,014 | 7,525 | ||||||||||||
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Asset impairment loss
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7,513 | 2,774 | 10,213 | 2,774 | ||||||||||||
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Inventory valuation adjustment
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- | - | - | 1,667 | ||||||||||||
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Interest expense, net
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2,026 | 1,308 | 3,723 | 2,655 | ||||||||||||
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Real estate taxes, net
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522 | 583 | 1,078 | 1,230 | ||||||||||||
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Property and asset management fees
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407 | 371 | 780 | 742 | ||||||||||||
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General and administrative
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257 | 259 | 464 | 482 | ||||||||||||
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Depreciation and amortization
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1,274 | 1,492 | 2,721 | 2,905 | ||||||||||||
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Cost of real estate inventory sales
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326 | 843 | 326 | 843 | ||||||||||||
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Total expenses
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16,447 | 11,477 | 27,319 | 20,823 | ||||||||||||
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Interest income
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45 | 38 | 106 | 68 | ||||||||||||
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Loss on derivative instrument, net
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- | (4 | ) | - | (38 | ) | ||||||||||
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Loss from operations before income taxes
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(11,027 | ) | (5,467 | ) | (15,817 | ) | (9,838 | ) | ||||||||
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Provision for income taxes
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(21 | ) | (42 | ) | (69 | ) | (81 | ) | ||||||||
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Loss from continuing operations
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(11,048 | ) | (5,509 | ) | (15,886 | ) | (9,919 | ) | ||||||||
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Loss from discontinued operations
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(3,757 | ) | (202 | ) | (4,177 | ) | (408 | ) | ||||||||
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Net loss
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(14,805 | ) | (5,711 | ) | (20,063 | ) | (10,327 | ) | ||||||||
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Noncontrolling interest in continuing operations
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494 | 465 | 778 | 999 | ||||||||||||
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Net loss attributable to the Partnership
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$ | (14,311 | ) | $ | (5,246 | ) | $ | (19,285 | ) | $ | (9,328 | ) | ||||
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Amounts attributable to the Partnership
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Continuing operations
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$ | (10,554 | ) | $ | (5,044 | ) | $ | (15,108 | ) | $ | (8,920 | ) | ||||
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Discontinued operations
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(3,757 | ) | (202 | ) | (4,177 | ) | (408 | ) | ||||||||
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Net loss attributable to the Partnership
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$ | (14,311 | ) | $ | (5,246 | ) | $ | (19,285 | ) | $ | (9,328 | ) | ||||
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Basic and diluted weighted average limited partnership units outstanding
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10,804 | 10,804 | 10,804 | 10,804 | ||||||||||||
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Net loss per limited partnership unit-basic and diluted
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Loss from continuing operations attributable to the Partnership
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$ | (0.97 | ) | $ | (0.47 | ) | $ | (1.39 | ) | $ | (0.82 | ) | ||||
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Loss from discontinued operations attributable to the Partnership
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(0.35 | ) | (0.02 | ) | (0.39 | ) | (0.04 | ) | ||||||||
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Basic and diluted net loss per limited partnership unit unattributable to the Partnership
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$ | (1.32 | ) | $ | (0.49 | ) | $ | (1.78 | ) | $ | (0.86 | ) | ||||
The accompanying unaudited, condensed consolidated financial statements do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America (GAAP). The financial statements include all adjustments (of a normal recurring nature) necessary to present fairly our consolidated financial position as of June 30, 2011 and December 31, 2010 and our unaudited, condensed consolidated results of operations and cash flows for the periods ended June 30, 2011 and June 30, 2010.
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15601 Dallas Parkway, Suite 600
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Presorted
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Addison, TX 75001
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Standard
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U.S. Postage Paid
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Date Published 09/11 · IN · 768-1
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Behringer Harvard
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© 2011 Behringer Harvard
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Second Quarter Report
Behringer Harvard Short-Term Opportunity Fund I LP
behringerharvard.com
Net Operating Income (NOI)1
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3 mos. ended
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3 mos. ended
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6 mos. ended
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6 mos. ended
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(in thousands)
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Jun. 30, 2011
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Jun. 30, 2010
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Jun. 30, 2011
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Jun. 30, 2010
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Total revenues
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$ | 5,375 | $ | 5,976 | $ | 11,396 | $ | 10,955 | ||||||||
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Operating expenses
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Property operating expenses
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4,122 | 3,847 | 8,014 | 7,525 | ||||||||||||
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Real estate taxes, net
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522 | 583 | 1,078 | 1,230 | ||||||||||||
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Property and asset management fees
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407 | 371 | 780 | 742 | ||||||||||||
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Cost of real estate inventory sales
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326 | 843 | 326 | 843 | ||||||||||||
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Less: Asset management fees
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(220 | ) | (177 | ) | (380 | ) | (354 | ) | ||||||||
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Total operating expenses
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5,157 | 5,467 | 9,818 | 9,986 | ||||||||||||
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Net operating income
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$ | 218 | $ | 509 | $ | 1,578 | $ | 969 | ||||||||
| Reconciliation to Net Loss | ||||||||||||||||
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Net operating income
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$ | 218 | $ | 509 | $ | 1,578 | $ | 969 | ||||||||
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Less: Depreciation and amortization
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(1,274 | ) | (1,492 | ) | (2,721 | ) | (2,905 | ) | ||||||||
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General and administrative expenses
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(257 | ) | (259 | ) | (464 | ) | (482 | ) | ||||||||
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Interest expense, net
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(2,026 | ) | (1,308 | ) | (3,723 | ) | (2,655 | ) | ||||||||
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Asset management fees
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(220 | ) | (177 | ) | (380 | ) | (354 | ) | ||||||||
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Asset impairment loss
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(7,513 | ) | (2,774 | ) | (10,213 | ) | (2,774 | ) | ||||||||
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Inventory valuation adjustment
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- | - | - | (1,667 | ) | |||||||||||
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Provision for income taxes
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(21 | ) | (42 | ) | (69 | ) | (81 | ) | ||||||||
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Add: Interest income
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45 | 38 | 106 | 68 | ||||||||||||
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Loss on derivative instrument, net
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- | (4 | ) | - | (38 | ) | ||||||||||
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Loss from discontinued operations
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(3,757 | ) | (202 | ) | (4,177 | ) | (408 | ) | ||||||||
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Net loss
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$ | (14,805 | ) | $ | (5,711 | ) | $ | (20,063 | ) | $ | (10,327 | ) | ||||
1 Net operating income (NOI), a non-GAAP financial measure, is defined as total revenue less property operating expenses, real estate taxes, property management fees, advertising costs, and cost of real estate inventory sales. Management believes that NOI provides an accurate measure of the Partnership’s operating performance because NOI excludes certain items that are not associated with management of our properties. NOI should not be considered as an alternative to net income (loss) or an indication of our liquidity. NOI is not indicative of funds available to fund our cash needs or our ability to make distributions and should be reviewed in connection with other GAAP measurements. To facilitate understanding of this financial measure, a reconciliation of NOI to GAAP net loss has been provided.