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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)
R           QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended March 31, 2012
 
or
 
¨           TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from _________ to __________

Commission File Number: 0-53652
 
Resource Real Estate Investors 6, L.P.  
(Exact Name of Registrant as Specified in Its Charter)
Delaware
 
37-1548084
(State or other jurisdiction of
 
(I.R.S. Employer
incorporation or organization)
 
Identification No.)

One Crescent Drive, Suite 203, Navy Yard Corporate Center, Philadelphia, PA  19112
(Address of principal executive offices) (Zip code)
(215) 231-7050
(Registrant's telephone number, including area code)
 
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.  Yes R No o
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes R No ¨
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
  o  
Accelerated filer
o
Non-accelerated filer
  ¨
(Do not check if a smaller reporting company)
Smaller reporting company
x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o No R

As of May 11, 2012, there were a total of 3,269,655 limited partner units outstanding.




RESOURCE REAL ESTATE INVESTORS 6, L.P.
ON FORM 10-Q


   
PAGE
PART I
FINANCIAL INFORMATION
 
     
ITEM 1.
Financial Statements
 
     
 
 3
     
 
 4
     
 
 5
     
 
 6
     
 
 7
     
ITEM 2.
 15
     
ITEM 3.
 20
     
ITEM 4.
 20
     
PART II
OTHER INFORMATION
 
     
ITEM 6.
 21
   
 22
 




 
PART I.
FINANCIAL INFORMATION
 


ITEM 1.
FINANCIAL STATEMENTS

RESOURCE REAL ESTATE INVESTORS 6, L.P.
(in thousands)


   
March 31,
   
December 31,
 
   
2012
   
2011
 
   
(unaudited)
       
ASSETS
           
Rental properties, at cost:
           
Land
  $ 7,430     $ 7,430  
Buildings and improvements
    57,831       57,756  
Personal property
    2,405       2,341  
Construction-in-progress
    220       129  
      67,886       67,656  
Accumulated depreciation and amortization
    (12,131 )     (11,440 )
      55,755       56,216  
                 
Cash
    1,174       1,255  
Restricted cash
    1,034       1,553  
Tenant receivables
    7       14  
Insurance proceeds receivable
    646       703  
Receivables from related party
    5       2  
Loans held for investment, net
           
Prepaid expenses and other assets
    161       211  
Deferred financing costs, net
    1,081       1,145  
Total assets
  $ 59,863     $ 61,099  
                 
LIABILITIES AND PARTNERS’ CAPITAL
               
Liabilities:
               
Mortgage notes payable
  $ 45,274     $ 45,274  
Accounts payable and accrued expenses
    493       1,031  
Accrued interest
    202       202  
Payables to related parties
    1,522       1,448  
Prepaid rent
    52       41  
Security deposits
    184       165  
Total liabilities
    47,727       48,161  
                 
Partners’ capital
    12,136       12,938  
                 
Total liabilities and partners’ capital
  $ 59,863     $ 61,099  
 

The accompanying notes are an integral part of these consolidated financial statements.




RESOURCE REAL ESTATE INVESTORS 6, L.P.
COMPREHENSIVE INCOME (LOSS)
(in thousands, except per unit data)
(unaudited)

   
Three Months Ended
 
   
March 31,
 
   
2012
   
2011
 
Revenues:
           
Rental income
  $ 2,161     $ 2,017  
                 
Expenses:
               
Rental operating
    985       897  
Management fees – related parties
    206       202  
General and administrative
    137       102  
Depreciation and amortization
    693       673  
Total expenses
    2,021       1,874  
                 
Income before other income (expense)
    140       143  
                 
Other income (expense):
               
Interest expense, net
    (656 )     (647 )
Casualty loss
    (9 )      
Gain on sale of fixed assets
    1        
Net loss
  $ (524 )   $ (504 )
                 
Comprehensive loss
  $ (524 )   $ (504 )
                 
Weighted average number of limited partner units outstanding
    3,702       3,708  
                 
Net loss per weighted average limited partner unit
  $ (0.14 )   $ (0.14 )


The accompanying notes are an integral part of these consolidated financial statements.


RESOURCE REAL ESTATE INVESTORS 6, L.P.
FOR THE THREE MONTHS ENDED MARCH 31, 2012
(in thousands, except units)
(unaudited)


   
General Partner
   
Limited Partners
   
Total
 
   
Amount
   
Units
   
Amount
   
Amount
 
Balance at January 1, 2012
  $ 1       3,701,890     $ 12,937     $ 12,938  
Distributions
                (278 )     (278 )
Net loss
                (524 )     (524 )
Balance at March 31, 2012
  $ 1       3,701,890     $ 12,135     $ 12,136  
 

The accompanying notes are an integral part of these consolidated financial statements.


RESOURCE REAL ESTATE INVESTORS 6, L.P.
(in thousands)
(unaudited)


   
For the Three Months Ended
 
   
March 31,
 
   
2012
   
2011
 
Cash flows from operating activities:
           
Net loss
  $ (524 )   $ (504 )
Adjustments to reconcile net loss to net cash provided by
operating activities:
               
Depreciation and amortization
    693       673  
Amortization of deferred financing costs
    64       63  
Casualty loss                                                                                   
    9        
Gain on sale of fixed assets                                                                                   
    (1 )      
Changes in operating assets and liabilities:
               
Restricted cash
    519       551  
Tenant receivables
    7       (3 )
Insurance proceeds receivable
    57        
Receivables from related party
    (1 )      
Prepaid expenses and other assets
    50       32  
Accounts payable and accrued expenses
    (547 )     (700 )
Payable to related parties
    74       (64 )
Prepaid rent
    11       35  
Security deposits
    19       1  
Net cash provided by operating activities
    430       84  
                 
Cash flows from investing activities:
               
Capital expenditures
    (233 )     (65 )
Net cash used in investing activities
    (233 )     (65 )
                 
Cash flows from financing activities:
               
Redemption, net
          (76 )
Distributions to limited partners
    (278 )     (277 )
Net cash used in financing activities
    (278 )     (353 )
                 
Net decrease in cash
    (81 )     (334 )
Cash at beginning of period
    1,255       2,488  
Cash at end of period
  $ 1,174     $ 2,154  
 

The accompanying notes are an integral part of these consolidated financial statements.


RESOURCE REAL ESTATE INVESTORS 6, L.P.
MARCH 31, 2012
(unaudited)

NOTE 1 – NATURE OF BUSINESS AND OPERATIONS

Resource Real Estate Investors 6, L.P. (“R-6” or the “Partnership”) is a Delaware limited partnership which owns and operates multifamily residential rental properties located in Maine and Texas (referred to as the “Properties”).  The Partnership also has invested in subordinated notes secured by multifamily residential properties located in California, Alabama and Nevada.  The Partnership was formed on July 26, 2007 and commenced operations on October 1, 2007.  The Partnership was capitalized by an offering of partnership units which was closed on May 19, 2008.  The General Partner, Resource Capital Partners, Inc. (“RCP”, the “General Partner” or “GP”), is in the business of sponsoring and managing real estate investment limited partnership and tenant in common programs.  RCP contributed $1,000 in cash as its minimum capital contribution to the Partnership.  In addition, RCP holds a 5.53% limited partnership interest in the Partnership at both March 31, 2012 and December 31, 2011.  RCP is an indirect wholly owned subsidiary of Resource America, Inc. (“RAI”), a publicly traded company (NASDAQ: REXI) operating in the real estate, commercial finance and financial fund management sectors.

The Partnership will continue until July 30, 2015, unless terminated earlier in accordance with the First Amended and Restated Agreement of Limited Partnership (the “Agreement”).  The GP has the right to extend the Partnership term for two one-year periods following the initial termination date, provided that all such extensions may not exceed two years in the aggregate.

The Agreement provides that income is allocated as follows: first, to the partners in proportion to and to the extent of the deficit balances, if any, in their respective capital accounts; second, to the partners in proportion to the allocations of Distributable Cash (as defined in the Agreement); and third, 100% to the limited partners (“LPs”).  All losses are allocated as follows: first, 100% to the LPs until the LPs have been allocated losses equal to the excess, if any, of their aggregate capital account balances over the aggregate Adjusted Capital Contributions (as defined in the Agreement); second, to the partners in proportion to and to the extent of their respective remaining positive capital account balances, if any; and third, 100% to the LPs.

Distributable cash from operations, payable monthly, as determined by the GP, is first allocated 100% to the LPs until the LPs have received their Preferred Return (as defined in the Agreement); and thereafter, 80% to the LPs and 20% to the GP.

Distributable cash from capital transactions, as determined by the GP, is first allocated 100% to the LPs until the LPs have received their Preferred Return; second, 100% to the LP’s until their Adjusted Capital Contributions (as defined in the Agreement) have been reduced to zero; and thereafter, 80% to the LPs and 20% to the GP.

The consolidated financial statements and the information and tables contained in the notes thereto as of March 31, 2012 are unaudited.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).  However, in the opinion of management, these interim financial statements include all the necessary adjustments to fairly present the results of the interim periods presented.  The unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2011.  The results of operations for the three months ended March 31, 2012 may not necessarily be indicative of the results of operations for the full year ending December 31, 2012.




RESOURCE REAL ESTATE INVESTORS 6, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS − (Continued)
MARCH 31, 2012
(unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of the significant accounting policies consistently applied in the preparation of the accompanying consolidated financial statements follows:

Principles of Consolidation

The consolidated financial statements include the accounts of the Partnership and its wholly owned subsidiaries, as follows:
 
Subsidiaries
 
Number of Units
 
Location
RRE Memorial Towers Holdings, LLC (“Memorial Towers”)
 
112
 
Houston, Texas
RRE Villas Holdings, LLC (“Villas”)
 
228
 
San Antonio, Texas
RRE Coach Lantern Holdings, LLC (“Coach Lantern”)
 
  90
 
Scarborough, Maine
RRE Foxcroft Holdings, LLC (“Foxcroft”)
 
104
 
Scarborough, Maine
RRE Park Hill Holdings, LLC (“Park Hill”)
 
288
 
San Antonio, Texas
Total
 
822
   

The Partnership also owns a 100% interest in RRE Funding II, LLC (“Funding”), which owns three non-performing subordinated notes, Acacia Park (“Acacia”), Hillwood (“Hillwood”) and Southern Cove (“Southern Cove”) with a combined face value of $2.9 million which have been fully reserved at March 31, 2012 and December 31, 2011.

All material intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  The Partnership estimates the allowance for uncollectible receivables and loan losses and adjusts the balance quarterly.  Actual results could differ from those estimates.

Supplemental Disclosure of Cash Flow Information

During the three month periods ended March 31, 2012 and 2011, the Partnership paid approximately $592,000 and $586,000, respectively in cash for interest.

Deferred Financing Costs

Costs incurred to obtain financing have been capitalized and are being amortized over the term of the related debt using the effective yield method.

Income Taxes

Income taxes or credits resulting from earnings or losses are payable by or accrue to the benefit of the partners; accordingly, no provision has been made for income taxes in these consolidated financial statements.

The Partnership evaluates the benefits of tax positions taken or expected to be taken in its tax returns under a two-step recognition and measurement process.  Only the largest amount of benefits from the tax positions that will more likely than not be sustainable upon examination are recognized by the Partnership.  The Partnership does not have any unrecognized tax benefits, nor interest and penalties, recorded in the Consolidated Balance Sheets or Consolidated Statements of Operations and does not anticipate significant adjustments to the total amount of unrecognized tax benefits within the next twelve months.




RESOURCE REAL ESTATE INVESTORS 6, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS − (Continued)
MARCH 31, 2012
(unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (Continued)

Income Taxes – (Continued)

The Partnership is subject to examination by the U.S. Internal Revenue Service and by the taxing authorities in those states in which the Partnership has significant business operations.  The Partnership is not currently undergoing any examinations by taxing authorities.  The Partnership may be subject to U.S. federal income tax and state/local income tax examinations for years 2008 through 2011.

Revenue Recognition

Revenue is primarily derived from the rental of residential housing units with lease agreement terms of generally one year or less.  The Partnership recognizes rent as income on a straight-line basis over the term of the related lease.  Additionally, any incentives included in the lease are amortized on a straight-line basis over the term of the lease.

Included within rental income on the statements of operations and comprehensive income (loss) are other income amounts such as utility reimbursements, late fees, parking fees, pet fees and lease application fees which are recognized when earned.

The future minimum rental payments to be received from noncancelable operating leases are approximately $3.6 million and $5,000 for the twelve months ending March 31, 2013 and 2014, respectively, and none thereafter.

Loans Held for Investment, Net

The Partnership recognizes revenue from the loans it holds for investment as interest income using the effective yield method.

The initial investment made in a purchased loan includes the amount paid to the seller plus any fees.  The initial investment frequently differs from the related loan’s principal amount at the date of purchase.  This difference is recognized as an adjustment of the yield over the life of the loan.

The Partnership initially records its loans at their purchase price, and subsequently accounts for them based on their outstanding principal plus or minus any unamortized premiums or discounts.

Interest income on loans includes interest at stated rates adjusted for amortization or accretion of premiums and discounts.  Premiums and discounts are amortized or accreted into income using the effective yield method.  When the Partnership purchases a loan or pool of loans at a discount, it evaluates whether all or a portion of the discount represents accretable yield.  If a loan with a premium or discount is prepaid, the Partnership immediately recognizes the unamortized portion as a decrease or increase to interest income.

The Partnership considers a loan to be impaired when, based on current information and events, management believes it is probable that the Partnership will be unable to collect all amounts due according to the contractual terms of the loan agreement.  When a loan is impaired, the allowance for loan losses is increased by the amount of the excess of the amortized cost basis of the loan over its fair value.  Fair value may be determined based on market price, if available, the fair value of the collateral less estimated disposition costs, or the present value of estimated cash flows.

The Partnership considers general and local economic conditions, neighborhood values, competitive overbuilding, casualty losses and other factors that may affect the value of loans and real estate securing those loans.  The value of loans and the related real estate may also be affected by factors such as the cost of compliance with regulations and liability under applicable environmental laws, changes in interest rates and the availability of financing.  Income from a property that supports a loan’s debt service requirements will be reduced if a significant number of tenants are unable to pay rent or if available space cannot be rented on favorable terms.  The Partnership continuously monitors collections and payments from its borrowers and maintains an allowance for estimated losses based upon its historical experience and its knowledge of specific borrower collection issues.  An impaired real estate loan may remain on accrual status during the period in which the Partnership is pursuing repayment of the loan; however, the loan will be placed on non-accrual status at such time as either (1) management believes that contractual debt service payments will not be met; (2) the loan becomes 90 days delinquent; or (3) management determines the borrower is incapable of, or has ceased efforts toward, curing the cause of the impairment.  While on non-accrual status, the Partnership recognizes interest income only when an actual payment is received.  If the timing and amount of expected future cash flows cannot be reasonably estimated for a loan, and collection is not probable, the cost recovery method of accounting is used.  Under the cost recovery method, any amounts received are applied against the recorded amount of the loan.



RESOURCE REAL ESTATE INVESTORS 6, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS − (Continued)
MARCH 31, 2012
(unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (Continued)

Long-Lived Assets

The Partnership reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  If it is determined that an asset’s estimated future cash flows will not be sufficient to recover its carrying amount, an impairment charge will be recorded to reduce the carrying amount for that asset to its estimated fair value.  There was no impairment loss recorded for either of the three months ended March 31, 2012 or 2011.

Rental Properties

Rental properties are carried at cost, net of accumulated depreciation.  Buildings and improvements and personal property are depreciated for financial reporting purposes on the straight-line method over their estimated useful lives.  The value of in place leases is amortized over twelve months on a straight line basis.  For income tax reporting purposes, the Partnership uses the Modified Accelerated Cost Recovery System.  Useful lives used for calculating depreciation for financial reporting purposes are as follows:

 
Buildings and improvements
5 - 27.5 years
 
 
Personal property
3 - 15 years
 

Advertising

The Partnership expenses advertising costs as they are incurred.  Advertising costs, which are included in rental operating expenses, totaled $29,000 and $25,000 for the three months ended March 31, 2012 and 2011, respectively.

Tenant Receivables

Tenant receivables are stated in the financial statements at amounts due from tenants net of an allowance for uncollectible receivables.  Payment terms vary and receivables outstanding longer than the payment terms are considered past due.  The Partnership determines its allowance by considering a number of factors, including the length of time receivables are past due, security deposits held, the Partnership’s previous loss history, the tenants’ current ability to pay their obligations to the Partnership, the condition of the general economy and the industry as whole.  The Partnership writes off receivables when they become uncollectible.  At March 31, 2012 and December 31, 2011, there was an allowance for uncollectible receivables of $82 and zero, respectively.

Redemptions

The LPs may request redemption of their units at any time.  The Partnership has no obligation to redeem any units and will do so only at the GP’s discretion.  If the Partnership redeems units, the redemption price is generally the initial investment less all distributions from the Partnership to the LP, and less all organization and offering expenses charged to the LP.


RESOURCE REAL ESTATE INVESTORS 6, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS − (Continued)
MARCH 31, 2012
(unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (Continued)

Recent Accounting Standards

Newly-Adopted Accounting Principles

The adoption of the following standards, issued by the Financial Accounting Standards Boards, (“FASB”), did not have a material impact on the Partnership’s consolidated financial position, results of operations or cash flows:

Fair Value Measurements.  In May 2011, the FASB issued an amendment to revise the wording used to describe the requirements for measuring fair value and for disclosing information about fair value measurements.  For many of the requirements, the FASB does not intend for the amendments to result in a change in the application of the current requirements.  Some of the amendments clarify the FASB’s intent about the application of existing fair value measurement requirements, such as specifying that the concepts of highest and best use and valuation premise in a fair value measurement are relevant only when measuring the fair value of nonfinancial assets.  Other amendments change a particular principle or requirement for measuring fair value or for disclosing information about fair value measurements such as specifying that, in the absence of a Level 1 input, a reporting entity should apply premiums or discounts when market participants would do so when pricing the asset or liability.  This guidance became effective for the Partnership beginning January 1, 2012 and the Partnership’s adoption did not have an impact on the Partnership’s financial condition, results of operations or cash flows.

Comprehensive Income (Loss).  In June 2011, the FASB issued an amendment to eliminate the option to present components of other comprehensive income (loss) as part of the statement of changes in stockholders’ equity.  The amendment requires that all non-owner changes in stockholders’ equity be presented either in a single continuous statement of comprehensive income (loss) or in two separate but consecutive statements.  In the two-statement approach, the first statement should present total net income (loss) and its components followed consecutively by a second statement that should present total other comprehensive income (loss), the components of other comprehensive income (loss), and the total of comprehensive income (loss).  This guidance became effective for the Partnership beginning January 1, 2012 and the Partnership’s adoption did not have an impact on the Partnership’s financial condition, results of operations or cash flows.

NOTE 3 − RESTRICTED CASH

Restricted cash represents escrow deposits with lenders to be used to pay real estate taxes, insurance, and capital improvements.  A summary of the components of restricted cash follows (in thousands):

   
March 31,
   
December 31,
 
   
2012
   
2011
 
Real estate taxes
  $ 228     $ 79  
Capital improvements
    624       877  
Insurance
    182       597  
Total
  $ 1,034     $ 1,553  

NOTE 4 − LOANS HELD FOR INVESTMENT, NET

A summary of loans held for investment, net, at March 31, 2012 and December 31, 2011 follows (in thousands):
 
   
Acacia
   
Hillwood
   
Southern Cove
   
Total
 
Loan principal
  $ 2,000     $ 400     $ 500     $ 2,900  
Discount
    (400 )     (40 )     (10 )     (450 )
Direct loan fees and costs
    79       18       24       121  
Accumulated amortization and accretion, net
    29       4       (1 )     32  
Allowance for loan losses
    (1,708 )     (382 )     (513 )     (2,603 )
Carrying amount of loan
  $     $     $     $  

   
Acacia
   
Hillwood
   
Southern Cove
 
Maturity date
 
08/11/16
   
01/08/17
   
05/08/17
 
Interest rate
    10.27%       10.97%       12.75%  
Average monthly payment (1) 
  $ 17,952     $ 3,799     $ 5,313  

(1)
Loans are in default and no payments have been received.

 
RESOURCE REAL ESTATE INVESTORS 6, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS − (Continued)
MARCH 31, 2012
(unaudited)

NOTE 4 − LOANS HELD FOR INVESTMENT, NET – (Continued)

All loans are subordinate to first mortgage holders with payment terms of interest only through maturity.  In 2009, the first mortgage holders informed the Partnership that the post-default payment terms of the intercreditor agreements had become effective due to the continued default by the borrowers.  Pursuant to these agreements, the first mortgage holders must be repaid in full before the Partnership may recover any current or accrued interest or principal.  Based on management’s analysis, the Partnership placed all three loans on non-accrual status, discontinued the amortization and accretion of the discount and direct loan fees and costs and provided a specific allowance for each loan during 2009.  At both March 31, 2012 and December 31, 2011, the allowance for loan losses was $2.6 million.

NOTE 5 – DEFERRED FINANCING COSTS

Deferred financing costs include unamortized costs incurred to obtain financing which are being amortized over the term of the related debt.  Accumulated amortization as of March 31, 2012 and December 31, 2011 was approximately $1.0 million and $982,000, respectively.  Estimated amortization of the existing deferred financing costs of the Partnership’s Properties for the next five years edning March 31, and thereafter, is as follows (in thousands):

2013
  $ 255  
2014
    254  
2015
    244  
2016
    145  
2017
    129  
Thereafter
    54  
    $ 1,081  

NOTE 6 – MORTGAGE NOTES PAYABLE

The following is a summary of mortgage notes payable (in thousands, except percentages):

Property
 
Balance at
March 31, 2012 and
December 31, 2011
 
Maturity Date
 
Annual
Interest Rate
   
Average
Monthly Debt
Service
 
Memorial Towers
  $ 7,400  
01/01/2017
    5.49%     $ 34  (1)
Villas
    10,800  
01/01/2017
    5.48%     $ 50  (1)
Coach Lantern
    7,884  
02/01/2015
    4.92%     $ 32  (2)
Foxcroft
    8,760  
02/01/2015
    4.92%     $ 36  (2)
Park Hill
    10,430  
03/01/2018
    5.05%     $ 44  (3)
Total
  $ 45,274                    

(1)
Interest only through January 1, 2013; monthly payment including principal and interest, effective February 1, 2013, will be $42,000 for Memorial Towers and $61,000 for Villas.
(2)
Interest only through the maturity date.
(3)
Interest only through March 1, 2013; monthly payment including principal and interest, effective April 1, 2013, will be $56,000.

Annual principal payments on the mortgage notes payable for each of the next five years ending March 31, and thereafter, are as follows (in thousands):

2013
  $ 43  
2014
    379  
2015
    400  
2016
    17,061  
2017
    17,586  
Thereafter
    9,805  
    $ 45,274  



RESOURCE REAL ESTATE INVESTORS 6, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS − (Continued)
MARCH 31, 2012
(unaudited)

NOTE 6 – MORTGAGE NOTES PAYABLE – (Continued)

The mortgage notes payable are with recourse only to the Properties securing them subject to certain limited standard exceptions, as defined in the mortgage notes, which the General Partner has guaranteed by executing a guarantee with respect to each property.  These exceptions are referred to as “carveouts”.  In general, carveouts relate to damages suffered by the lender for a subsidiary’s failure to pay rents, insurance or condemnation proceeds to lender, to pay water, sewer and other public assessments or charges, to pay environmental compliance costs or to deliver books and records, in each case as required in the loan documents.  The exceptions also require the General Partner to guarantee payment of audit costs, lender’s enforcement of its rights under the loan documents and payment of the loan if the subsidiary voluntarily files for bankruptcy or seeks reorganization, or if a related party of the subsidiary does so with respect to the subsidiary.

NOTE 7 – CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

In the ordinary course of its business operations, the Partnership has ongoing relationships with several related entities.   During the three months ended March 31, 2012, one property sold a piece of equipment to another property owned by a fund with the same general partner, generating a $1,000 gain on sale of a fixed asset.

RCP is entitled to receive an annual investment management fee, payable monthly, equal to 1% of the gross offering proceeds, net of any LP interest owned by RCP.  During the term of the Partnership, RCP must subordinate up to 100% of its annual investment management fee to the receipt by the LPs of their Preferred Return.  Incentive Management Fees due to RCP at March 31, 2012 and December 31, 2011 totaled $1.4 million and $1.3 million, respectively.

A wholly owned subsidiary of RCP, Resource Real Estate Management, LLC (“RREML”) is entitled to receive property and debt management fees. RREML engaged Resource Real Estate Management, Inc (“RREMI”), an indirect wholly owned subsidiary of RAI, to act as manager of the Partnership’s properties.  Management fees due to RCP and affiliates at March 31, 2012 and December 31, 2011 totaled $87,000 and $98,000, respectively.

During the ordinary course of business, RCP and RREMI advance funds for ordinary operating expenses on behalf of the Properties; these advances are repaid within a few days.  Operating expense advances due to RCP and RREMI at both March 31, 2012 and December 31, 2011 totaled $18,000.

The Partnership is obligated to pay fees and reimbursements of expenses to related parties.  These activities are summarized as follows (in thousands):

   
Three Months Ended
 
   
March 31,
 
   
2012
   
2011
 
RCP:
           
Investment management fees (1) 
  $ 85     $ 85  
                 
RREML:
               
Property management fees (2) 
    106       102  
Debt management fees (3) 
    15       15  
      121       117  
    $ 206     $ 202  

(1)
RCP is entitled to receive an annual investment management fee, payable monthly, equal to 1% of the gross proceeds from the offering of partnership units, net of any LP interest owned by RCP.  During the term of the Partnership, RCP must subordinate up to 100% of its annual investment management fee to the receipt by the LPs of their Preferred Return.
(2)
RREML is entitled to receive monthly property management fees equal to 5% of the gross operating revenues from the Partnership’s 100% owned properties for managing or obtaining and supervising third party managers.
(3)
RREML is also entitled to receive monthly debt management fees equal to 0.167% (2% per annum) of the gross offering proceeds that have been invested in loans held for investment.  The fee is earned for monitoring the performance of the Partnership’s loans held for investment.

 
RESOURCE REAL ESTATE INVESTORS 6, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS − (Continued)
MARCH 31, 2012
(unaudited)

NOTE 8 –FAIR VALUE OF FINANCIAL INSTRUMENTS

In analyzing the fair value of its investments accounted for on a fair value basis, the Partnership follows the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The Partnership determines fair value based on quoted prices when available or, if quoted prices are not available, through the use of alternative approaches, such as discounting the expected cash flows using market interest rates commensurate with the credit quality and duration of the investment.  The hierarchy followed defines three levels of inputs that may be used to measure fair value:

Level 1 - Quoted prices in active markets for identical assets that the reporting entity has the ability to access at the measurement date. 

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or can be corroborated with observable market data for substantially the entire contractual term of the asset.

Level 3 - Unobservable inputs that reflect the entity’s own assumptions about the assumptions that market participants would use in the pricing of the asset and are consequently not based on market activity, but rather through particular valuation techniques.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:
 
 
Loans held for investment, net.  The fair value of the loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities.
 
 
Mortgage notes payable.  Rates currently available to the Partnership for debt with similar terms and remaining maturities are used to estimate fair value of existing debt.

The estimated fair value measurements of the mortgage notes payable are classified within level 3 of the fair value hierarchy.

The estimated fair values of the Partnership’s financial instruments are as follows (in thousands):

   
March 31, 2012
   
December 31, 2011
 
   
Carrying Amount
   
Fair Value
   
Carrying Amount
   
Fair Value
 
Loans held for investment, net
  $     $     $     $  
                                 
Mortgage notes payable:
                               
Memorial Towers
  $ 7,400     $ 8,005     $ 7,400     $ 7,860  
Villas
    10,800       11,678       10,800       11,467  
Coach Lantern
    7,884       8,258       7,884       8,084  
Foxcroft
    8,760       9,149       8,760       8,964  
Park Hill
    10,430       11,173       10,430       10,984  
Total mortgage notes payable
  $ 45,274     $ 48,263     $ 45,274     $ 47,359  

NOTE 9 – INSURANCE CLAIM

On September 13, 2011, a fire damaged twelve units at Park Hill.  The Partnership was insured for both the fire loss and the loss of rental income.  The Partnership reduced the net carrying value of buildings and improvements for Park Hill by $399,000 and established a receivable for the expected net insurance proceeds of $995,000, net of the $25,000 deductible and including $20,000 for the loss of rental income.  During the year ended December 31, 2011, insurance proceeds of $293,000 were received.  During the three months ended March 31, 2012, the Partnership received additional insurance proceeds of $83,000, recorded an additional receivable of $26,000 for the loss of rental income and recorded a casualty loss of $9,000.

NOTE 10 – SUBSEQUENT EVENTS

The Partnership has evaluated subsequent events and determined that no events have occurred which would require an adjustment to the consolidated financial statements.



ITEM 2.
 
AND RESULTS OF OPERATIONS (unaudited)

This report contains certain forward-looking statements.  Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts.  In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “could,” “estimate,” “expects,” “intend,” “may,” “plan,” “potential,” “project,” “should,” “will” and “would” or the negative of these terms or other comparable terminology.  Such statements are subject to the risks and uncertainties inherent in partnerships that invest in real estate and real estate assets, including those referred to in our filings under the Securities Exchange Act of 1934.  These risks and uncertainties could cause actual results to differ materially.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.  We undertake no obligation to publicly revise or update these forward-looking statements to reflect events or circumstances after the date of this report, except as may be required under applicable law.

Overview

We are a Delaware limited partnership that was formed on July 26, 2007 and commenced operations on October 1, 2007.  Through our wholly owned subsidiaries, we own in fee, operate and invest in multifamily residential rental properties located in both Maine and Texas.  We also invest through a wholly owned subsidiary in subordinated notes that are secured by multifamily residential rental properties located in California, Alabama and Nevada.  We refer to our property investments as our Properties, our debt investments as our Real Estate Debt Investments, and collectively refer to our Properties and Real Estate Debt Investments as our Real Estate Investments.

As of March 31, 2012, we own five multifamily residential rental properties through our 100% owned subsidiaries, as follows:

Subsidiaries
 
Purchase
Date
 
Leverage
Ratio (1)
   
Number
of Units
 
Location
 
RRE Memorial Towers Holdings, LLC, or
Memorial Towers
 
12/18/07
    63%       112  
Houston, Texas
 
RRE Villas Holdings, LLC, or Villas
 
12/27/07
    67%       228  
San Antonio, Texas
 
RRE Coach Lantern Holdings, LLC, or Coach Lantern
 
01/29/08
    61%       90  
Scarborough, Maine
 
RRE Foxcroft Holdings, LLC, or Foxcroft
 
01/29/08
    62%       104  
Scarborough, Maine
 
RRE Park Hill Holdings, LLC, or Park Hill
 
02/29/08
    56%       288  
San Antonio, Texas
 
Total
                822      

(1)
Face value of mortgage divided by the original total property capitalization, including original reserves, escrows, fees and closing costs.

The following table sets forth operating statistics about our multifamily residential rental properties:
 

   
Average
Occupancy Rate (1)
   
Average Effective Rent
per Square Foot (2)
   
Ratio of Operating
Expense to Revenue (3)
 
 
Apartment Complex
 
March 31,
2012
   
March 31,
2011
   
March 31,
2012
   
March 31,
2011
   
March 31,
2012
   
March 31,
2011
 
Memorial Towers
    94.0%       91.7%     $ 1.16     $ 1.02       63.4%       57.0%  
Villas
    96.8%       95.2%     $ 0.89     $ 0.84       50.5%       57.5%  
Coach Lantern
    96.7%       95.6%     $ 1.03     $ 0.97       40.4%       37.3%  
Foxcroft
    94.9%       94.9%     $ 1.08     $ 1.02       44.1%       45.4%  
Park Hill
    95.0%       95.6%     $ 0.87     $ 0.79       60.8%       54.8%  

(1)
Number of occupied units divided by total units adjusted for any unrentable units; average calculated on a weekly basis.
(2)
Average rental revenue divided by total rentable square footage.  We calculate average rental revenue by dividing gross rental revenue by the number of months in a period.
(3)
Includes rental operating expenses and general and administrative expenses as a percentage of rental income.
 
 
We also own three subordinated notes through our wholly owned subsidiary, RRE Funding II, LLC, or Funding, which was formed to hold title to our Real Estate Debt Investments, as of March 31, 2012, as follows (in thousands, except units and percentages):

Real Estate Debt Investments
 
Face Value
of Note
   
Carrying Value
of Note
   
Stated
Interest
Rate
   
Number
of Units
 
Location
Acacia Park or Acacia
  $ 2,000     $       10.27%       304  
San Bernardino, California
Hillwood
  $ 400     $       10.97%       118  
Montgomery, Alabama
Southern Cove
  $ 500     $       12.75%       100  
Las Vegas, Nevada

Results of Operations

We generate our income from the net revenues we receive from our Properties.  We also may, in the future, generate funds from the sale or refinancing of our Properties or the sale or repayment of our Real Estate Debt Investments.  Because we acquired our Properties in late 2007 and early 2008, we do not expect that we will sell or refinance our Properties during at least the next year.  Should economic conditions in the areas in which our Properties are located deteriorate, we could experience lower occupancy, lower rental revenues and higher operating costs, all of which could harm our operations and financial condition, reduce the value of our Properties and limit or eliminate our ability to make distributions to our limited partners.

Our Real Estate Debt Investments have not been generating revenue as a result of borrower defaults.  In 2009, all three of our Real Estate Debt Investments were materially adversely affected by economic conditions in the United States and became delinquent.  The senior lenders on the properties securing our Real Estate Debt Investments formally declared their loans to be in default.  The senior lenders on all three notes informed us that, because of borrowers’ defaults, the post default payment terms of the intercreditor agreements between the senior lenders and us had become effective.  Pursuant to these agreements, the senior lenders must be repaid in full before we receive any current or accrued interest or principal.  Based on management’s analysis, we placed all three loans on non-accrual status.  Once we place a loan on non-accrual, we recognize revenue only as cash is received and management concludes that collection is probable, otherwise all cash received will reduce principal.  We have established an allowance for loan losses of approximately $2.6 million to fully reserve all three loans.

Our operating results and cash flows from our Properties are affected by four principal factors:
 
 
occupancy and rental rates,
 
 
property operating expenses,
 
 
interest rates on the related financing, and
 
 
capital expenditures.

The amount of rental revenues from our Properties depends upon their occupancy rates and concessions granted.  We seek to maximize our occupancy rates through aggressive property-level programs, including, in particular, our lease assurance program and our Lease Rent Optimizer, or LRO, program which includes rent concessions and a substantial capital improvements program.  Under our lease assurance program, we are marketing our apartment units to current and potential tenants who are worried about incurring substantial lease breakage penalties if they lose their jobs.  The program allows tenants who sign new or renewal leases to terminate their leases without penalty within 45 days after they provide proof of an involuntary job loss.  Under our LRO program, we seek to price our rents for apartment units on a daily basis, based upon inventory in the marketplace and competitors’ pricing.  As a result of these programs, our Properties experienced an overall increase in the average occupancy rate during the three months ended March 31, 2012 of approximately 1.8%, with an average occupancy rate of 95.5% as compared to an average occupancy rate of 94.6% during the same period in 2011.

We seek to control operating expenses through our General Partner’s automated purchase order system that compares actual to budgeted expenses and requires management approval of variances, and through the use of third-party service providers to seek best available pricing.

Our existing financing is at fixed rates of interest and, accordingly, our interest cost has remained stable during the period of our ownership of the Properties.  Because our existing financing extends through periods ranging from 2015 to 2018, we expect that our financing costs will remain stable during substantially all of our expected term.

Under our capital improvements program, more particularly described in “Liquidity and Capital Resources,” we expect to spend approximately $4.6 million in the next four to six years for property improvements intended to increase the Properties’ appeal to tenants.  As we implement planned improvements to our Properties, we seek to cause our occupancy rates and, potentially, rental rates and our cash flow from operating activities to increase.



Three Months Ended March 31, 2012 Compared to Three Months Ended March 31, 2011

The following table sets forth the unaudited results of our operations for the three months ended March 31, 2012 and 2011 (in thousands, except per unit data):

   
March 31,
   
Increase (Decrease)
 
   
2012
   
2011
   
Dollars
   
Percent
 
Revenues:
                       
Rental income
  $ 2,161     $ 2,017     $ 144       7%  
                                 
Expenses:
                               
Rental operating
    985       897       88       10%  
Management fees – related parties
    206       202       4       2%  
General and administrative
    137       102       35       34%  
Depreciation and amortization
    693       673       20       3%  
Total expenses
    2,021       1,874       147       8%  
Income before interest expense, net
    140       143       (3 )     (1)%  
                                 
Other income (expenses):
                               
Interest expense, net
    (656 )     (647 )     (9 )     1%  
Insurance proceeds in excess of cost basis
    (9 )           (9 )     100%  
Gain on sale of fixed asset
    1             1       100%  
Net loss
  $ (524 )   $ (504 )   $ 20       4%  
Weighted average number of limited partner units outstanding
    3,702       3,708                  
Net loss per weighted average limited partner unit
  $ (0.14 )   $ (0.14 )                

Revenues

We attribute the $144,000 increase in revenues principally to the increase in average occupancy rate combined with the increase in the average effective rent per square foot at the Properties as a result of the increased occupancy rates.  Occupancy rates have varied within our expected range.  We were able to increase rents as a result of stable occupancy and favorable market demand.

Expenses

We attribute the $147,000 increase in expenses principally to:
 
 
an $88,000 increase in rental operating expenses reflecting the following:
 
 
a $45,000 increase in insurance expense across all Properties as the result of loss experience; and
 
 
a $53,000 increase in payroll expense across all Properties due to annual salary increases.
 
These increases were offset by:
 
 
a $13,000 decrease in common area electric costs at a property due to securing a contract with lower rates.
 
 
a $35,000 increase in general and administrative expenses due to an increase in professional fees; and
 
 
a $20,000 increase in depreciation and amortization due to an increase in the amount of personal property at the Properties.

 
Liquidity and Capital Resources

The following table sets forth our sources and uses of cash (in thousands):

   
March 31,
 
   
2012
   
2011
 
Provided by operating activities (1) 
  $ 430     $ 84  
Used in investing activities
    (233 )     (65 )
Used in financing activities
    (278 )     (353 )
Net decrease in cash
  $ (81 )   $ (334 )

(1)
Including changes in operating assets and liabilities.

Our liquidity needs consist principally of funds to pay the Properties’ debt service, operating expenses, capital expenditures and monthly distributions to the limited partners.  Our ability to meet our liquidity needs will be subject to our ability to generate cash from operations, to control property operating expenses and, with respect to capital expenditures, use of the cash reserves established when the properties were purchased.  The ability to generate cash from operations will depend on the occupancy rates, rates charged to tenants compared with competing properties in the area and the ability of tenants to pay rent.  Occupancy rates can fluctuate based on changes in local market conditions where the Properties are located such as: excessive building resulting in an oversupply of similar properties, deterioration of surrounding areas, a decrease in market rates or local economic conditions including unemployment rates.  The rental rates charged to tenants compared to competing properties can be impacted by a lack of perceived safety, convenience and attractiveness of a property.

Under our capital improvements program, we expect to spend approximately $4.6 million in the next four to six years for property improvements intended to increase the Properties’ appeal to tenants and to the extent possible, increase the value of the Properties.  As we implement planned improvements to our Properties, we seek to maintain our stable occupancy rates and, potentially, increase rental rates and our cash flow from operating activities in order to pay for these improvements.

The following table sets forth the capital expenditures incurred during the three months ended March 31, 2012 and estimated future capital expenditures which are discretionary in nature (in thousands):

Subsidiary
 
Capital
Expenditures
   
Future
Discretionary
Capital
Expenditures
 
Memorial Towers
  $ 108,000     $ 659,000  
Villas
    29,000       1,125,000  
Coach Lantern
    12,000       612,000  
Foxcroft
    9,000       902,000  
Park Hill
    75,000       1,281,000  
Total
  $ 233,000     $ 4,579,000  

Funding for future discretionary capital expenditures over the remaining life of the Partnership will come from both the cash reserves established when the Properties were purchased and future operating cash flows.  Although our capital expenditures were $233,000 during the three months ended March 31, 2012, we have planned a series of major capital projects for our Properties, such as repairs and renovations on the HVAC systems, parking improvements, and foundation work.  We review future expenditures periodically and adjust them based on both operating results and local market conditions.  We cannot assure you that we will complete projects currently planned or that we will not change our plans in response to changes in market conditions.  Pending future reviews of our capital projects program, we intend to use the reserves not needed for the program to fund debt service requirements beginning in 2013.

Our restricted cash represents escrow deposits with lenders to be used to pay real estate taxes, insurance and capital improvements.



Redemption of Units

We are permitted, in our General Partner’s sole discretion, to redeem units upon a unitholder’s request.  However, we have no obligation to redeem units at any time, and we can decline to redeem units for any reason. For example, if our General Partner determines that we do not have the necessary cash flow, taking into account future distributions to our other limited partners, investments, and foreseeable operating expenses, a unitholder’s request may be declined. In addition, our General Partner may not approve the redemption of units if it concludes that the redemption might cause our total unit transfers in the year, subject to certain exceptions, to exceed 2% of our total capital or profits interests. All of these determinations are subjective and will be made in our General Partner’s sole discretion.  We will also determine the redemption price based on provisions set forth in the First Amended and Restated Agreement of Limited Partnership, or the Partnership Agreement. To the extent the formula for arriving at the redemption price has any subjective determinations, they will fall within the sole discretion of our General Partner.  If we lack the requisite liquidity to redeem the units, our General Partner, in its sole discretion, may purchase the units on generally the same terms as we would have redeemed the units.  As of March 31, 2012, we have redeemed 11,602 units at an aggregrate redemption price of $88,784, although no units were redeemed during the quarter then ended.

Legal Proceedings

We are a party to various routine legal proceedings arising out of the ordinary course of our business.  Management believes that none of these actions, individually or in the aggregate, will have a material adverse effect on our financial condition or results of operations.

Critical Accounting Policies

The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP.  The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of our assets, liabilities, revenues and cost and expenses, and related disclosure of contingent assets and liabilities.  On an on-going basis, we evaluate our estimates, including those related to certain accrued liabilities.  We base our estimates on historical experience and on various other assumptions that we believe reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results may differ from these estimates under different assumptions or conditions.

For a discussion on our critical accounting policies and estimates, see the discussion in our Annual Report on Form 10-K for the year ended December 31, 2011 under “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates.”

Off-Balance Sheet Arrangements

As of March 31, 2012 and December 31, 2011, we do not have any off-balance sheet arrangements or obligations, including contingent obligations, other than guarantees by the General Partner of certain limited standard expectations to the non-recourse nature of the mortgage notes which are secured by the Properties.

Recent Accounting Standards

Newly-Adopted Accounting Principles

The adoption of the following standards did not have a material impact on our consolidated financial position, results of operations or cash flows:

Fair Value Measurements.  In May 2011, the FASB issued an amendment to revise the wording used to describe the requirements for measuring fair value and for disclosing information about fair value measurements. For many of the requirements, the FASB does not intend for the amendments to result in a change in the application of the current requirements. Some of the amendments clarify the FASB’s intent about the application of existing fair value measurement requirements, such as specifying that the concepts of highest and best use and valuation premise in a fair value measurement are relevant only when measuring the fair value of nonfinancial assets. Other amendments change a particular principle or requirement for measuring fair value or for disclosing information about fair value measurements such as specifying that, in the absence of a Level 1 input, a reporting entity should apply premiums or discounts when market participants would do so when pricing the asset or liability.  This guidance became effective for us beginning January 1, 2012.  This amendment did have an impact on our financial statements.


Comprehensive Income (Loss).  In June 2011, the FASB issued an amendment to eliminate the option to present components of other comprehensive income (loss) as part of the statement of changes in stockholders’ equity.  The amendment requires that all non-owner changes in stockholders’ equity be presented either in a single continuous statement of comprehensive income (loss) or in two separate but consecutive statements.  In the two-statement approach, the first statement should present total net income (loss) and its components followed consecutively by a second statement that should present total other comprehensive income (loss), the components of other comprehensive income (loss), and the total of comprehensive income (loss).  This guidance became effective for us beginning January 1, 2012.  This amendment did have an impact on our financial statements.



Omitted pursuant to Regulation S-K, Item 305(e).



Disclosure Controls

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our periodic reports under the Securities Exchange Act of 1934, as amended, or the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our General Partner, including its chief executive officer and its chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.  In designing and evaluating the disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Under the supervision of the chief executive officer and chief financial officer of our General Partner, we have carried out an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report.  Based upon that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting that occurred during our first quarter ended March 31, 2012 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.





 
PART II.
OTHER INFORMATION
 
 

ITEM 6.

Exhibit No.
 
Description
3.1
 
Amended and Restated Agreement of Limited Partnership. (1)
     
3.2
 
Certificate of Limited Partnership. (1)
     
4.1
 
Forms of letters sent to limited partners confirming their investment. (1)
     
31.1
 
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
     
31.2
 
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
     
32.1
 
Certification of Chief Executive Officer pursuant to Section 1350 18 U.S.C., as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
     
32.2
 
Certification of Chief Financial Officer pursuant to Section 1350 18 U.S.C., as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
     
101.1
 
The following information from the Partnership's quarterly report on Form 10-Q for the quarter ended March 31, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements of Changes in Partners' Capital; (iv) Consolidated Statements of Cash Flows.

(1)
Filed previously as an exhibit to the Partnership’s registration statement on Form 10 for the year ended December 31, 2008 and by this reference incorporated herein.




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.


 
RESOURCE REAL ESTATE INVESTORS 6, L.P.
 
By:  Resource Capital Partners, Inc., its general partner
   
May 11, 2012
By:           /s/ Kevin M. Finkel
 
Kevin M. Finkel
 
President
 
(Principal Executive Officer)


May 11, 2012
By:           /s/ Steven R. Saltzman
 
Steven R. Saltzman
 
Vice President – Finance
 
(Principal Financial and Accounting Officer)
 
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