REALMARK PROPERTY INVESTORS LTD PARTNERSHIP II - FORM 10-Q

Attached files

file	filename
EXCEL - IDEA: XBRL DOCUMENT - REALMARK PROPERTY INVESTORS LTD PARTNERSHIP II	Financial_Report.xls
EX-31 - CERTIFICATION PURSUANT TO RULE 13A-14(A), AS ADOPTED PURSUANT TO SECTION 302 - REALMARK PROPERTY INVESTORS LTD PARTNERSHIP II	ex31.htm
EX-32 - CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 - REALMARK PROPERTY INVESTORS LTD PARTNERSHIP II	ex32.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2013

[ ] 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: 0-11909

REALMARK PROPERTY INVESTORS LIMITED PARTNERSHIP - II

(Exact name of registrant as specified in its charter)

Delaware		16-1212761
(State of organization)		(IRS Employer Identification No.)

2350 North Forest Road, Getzville, New York 14068

(Address of principal executive offices)

(716) 636-9090

(Registrant’s telephone number)

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 [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulations S-T (232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit and post such files) Yes [ ] No [X]

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 [ ] Accelerated filer [ ] 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 [ ] No [X]

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes [ ] No [X]

Part 1 - FINANCIAL INFORMATION
Item 1 - Financial Statements

Condensed Balance Sheet

		(Unaudited)
		September 30,		December 31,
Assets		2013		2012

Property and equipment, at cost	$	4,902,479	$	4,870,606
Less accumulated depreciation		(3,893,970)		(3,872,949)
		1,008,509		997,657
Equity interest in unconsolidated
joint ventures		1,148,515		1,149,076
Cash and equivalents		64,890		364,890
Accounts receivable, net		1,612		1,381
Receivable from affiliates, net		170,113		110
Other assets		71,290		101,375
Total assets	$	2,464,929	$	2,614,489

Liabilities and Partners' Equity

Accounts payable and accrued expenses		30,898		45,580
Security deposits and prepaid rent		30,701		54,417
Partners' equity		2,403,330		2,514,492
Total liabilities and partners' equity	$	2,464,929	$	2,614,489


See accompanying notes to the Financial Statements

	Condensed Statements of Operations
			(Unaudited)

	Three months ended September 30,				Nine months ended September 30,
	2013		2012		2013		2012

Rental income	$	116,664	$	126,703	$	388,536	$	423,833
Other income		819		791		1817		3,179
Total income		117,484		127,494		390,353		427,012

Property operating costs		128,781		141,231		383,141		383,911
Administrative expense - affiliates		20,500		22,050		67,648		63,160
Other administrative expenses		6,456		13,793		29,143		47,961
Depreciation		7,222		7,222		21,022		21,756
Total expenses		162,959		184,296		500,954		516,788

Loss before equity in earnings of
unconsolidated joint ventures		(45,476)		(56,802)		(110,601)		(89,776)
Equity in earnings of unconsolidated
joint ventures		(23)		(1,427)		(562)		19,582
Net loss	$	(45,499)	$	(58,229)	$	(111,163)	$	(70,194)

Net loss per limited partnership unit	$	(4.41)	$	(5.65)	$	(10.78)	$	(6.81)
Weighted average limited partnership
units outstanding		10,000		10,000		10,000		10,000

See accompanying notes to the Financial Statements

Condensed Statements of Cash Flows
(Unaudited)

		Nine months ended September 30,
		2013		2012
Cash provided by (used in):
Operating activities:
Net loss	$	(111,163)	$	(70,194)
Adjustments:
Depreciation		21,022		21,756
Equity in earnings of joint ventures		562		(19,582)
Other, principally changes in other assets
and liabilities		(178,548)		172,646
Net cash provided (used in) operating activities		(268,127)		104,626

Cash flows from investing activities:
Additions to property and equipment		(31,873)		-
Net increase (decrease) in cash and equivalents		(300,000)		104,626

Cash and equivalents at beginning of period		364,890		272,461
Cash and equivalents at end of period	$	64,890	$	377,087

See accompanying notes to the Financial Statements

Notes to Financial Statements

Nine months ended September 30, 2013 and 2012

(Unaudited)

Organization

Realmark Property Investors Limited Partnership - II (the Partnership), a Delaware Limited Partnership was formed on March 25, 1982, to invest in a diversified portfolio of income producing real estate investments. The general partners are Realmark Properties, Inc. (the corporate general partner) and Joseph M. Jayson (the individual general partner). Joseph M. Jayson is the sole stockholder of J.M. Jayson & Company Inc. Realmark Properties, Inc. is a wholly-owned subsidiary of J.M. Jayson & Company, Inc. Under the partnership agreement, the general partners and their affiliates receive compensation for services rendered and reimbursement for expenses incurred on behalf of the Partnership.

Basis of Presentation

The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the instructions to Form 10-Q. Accordingly, they do not include all of the information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. The balance sheet at December 31, 2012 has been derived from the audited financial statements at that date. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation, have been included. The Partnership’s significant accounting policies are set forth in its December 31, 2012 Form 10-K. The interim financial statements should be read in conjunction with the financial statements included therein. The interim results should not be considered indicative of the annual results.

Property and Equipment

At September 30, 2013, the Partnership owned and operated an office complex in Michigan (Northwind Office Park), and was a partner in two joint ventures. It has a 50% interest in Research Triangle Industrial Park Joint Venture with the other 50% owned by Realmark Property Investors Limited Partnership - VI A (RPILP - VI A), an entity affiliated through common general partners.

Investment in Other Joint Ventures

At September 30, 2013, the Partnership also held an interest in a land joint venture with affiliated entities through common general partners. The investment in this joint ventures relates solely to land and its value is $21,181 and $21,181 as of September 30, 2013 and December 31, 2012, respectively.

Investment in Research Triangle Industrial Park Joint Venture

The Partnership has a 50% interest in Research Triangle Industrial Park Joint Venture (the Venture) with Realmark Property Investors Limited Partnership – VIA (RPILP – VIA), an entity affiliated through common general partners. The joint venture owned and operated the Research Triangle Industrial Park West, an office/warehouse facility in Durham, North Carolina, which was sold in December 2006. The joint venture agreement provides that any income, loss, gain, cash flow, or sale proceeds be allocated 50% to the Partnership and 50% to RPILP – VIA. Summary financial information of the Venture follows:

Balance Sheet Information

		(Unaudited)
		September 30,		December 31,
		2013		2012
Assets:
Cash and equivalents	$	1,427	$	1,147
Receivable from affiliates		1,958,468		1,789,868
Accrued interest receivable		464,773		464,773
Total assets	$	2,424,668	$	2,255,788

Liabilities - payables to affiliates		170,000		-

Partners' equity:
The Partnership		1,127,334		1,127,894
RPILP - VI A		1,127,334		1,127,894
Total liabilities and partners' equity	$	2,424,668	$	2,255,788

Operating Information
(Unaudited)

		September 30,		September 30,
		2013		2012
Income:
Interest income	$	-	$	42,291

Expenses:
Interest		-		20
Administrative		1,121		253
Total expenses		1,121		273

Net income loss	$	(1,121)	$	42,018

Allocation of net income loss:
The Partnership		(561)		21,009
RPILP - VI A		(560)		21,009
	$	(1,121)	$	42,018

PART I - Item 2. Management’s Discussion and Analysis of Financial Condition and Resultof Operations

Liquidity and Capital Resources

Effective January 1, 2001, management began formally marketing all remaining properties in the Partnership for sale. The Partnership continues to maintain a cash position adequate to fund capital improvements. Cash decreased $300,000 and increased $104,626 during the nine month periods ended September 30, 2013 and 2012, respectively. The Partnership made no distributions to limited partners in the first nine months of 2013 and 2012. In accordance with the settlement of the lawsuit (Part II, Item 1), it is anticipated that with the sale of the remaining property and joint ventures, the Partnership may be in a position to make distributions to the limited partners.

Results of Operations

As compared to the first nine months of 2013, the Partnership's net loss, excluding equity in earnings from joint ventures, increased $40,969 from net loss of $70,194 in 2012 to a net loss of $111,163 in 2013. Total income for the nine months ended September 30, 2013 decreased approximately $36,700 when compared to the same period in 2012. Other administrative expense decreased approximately $18,800 due to a decrease in other professional expenses. Administrative expense to affiliates decreased approximately $4,500 due to a decrease in professional fees.

PART I - Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Partnership’s cash equivalents are short-term, interest-bearing bank accounts.

PART I - Item 4. Controls and Procedures

Disclosure Controls and Procedures: The Partnership’s management, with the participation of the Partnership’s Individual General Partner, Principal Executive Officer and Principal Financial Officer, has evaluated the effectiveness of the Partnership’s disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based on such evaluation, the Partnership’s Individual General Partner, Principal Executive Officer and Principal Financial Officer have concluded that, as of the end of such period, the Partnership’s disclosure controls and procedures are effective.

Internal Control Over Financial Reporting: There have been no significant changes in the Partnership’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities and Exchange Act of 1934, as amended) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Partnership’s internal control over financial reporting. Management assessed the effectiveness of our internal control over financial reporting as of September 30, 2013. In making this assessment, our management used the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

As previously reported, the Partnership, as a nominal defendant, the General Partners of the Partnership and of affiliated public partnerships (the “Realmark Partnerships”) and the officers and directors of the Corporate General Partner, as defendants, had been involved in a class action litigation in New York State court. The Partnership’s settlement of this litigation was described in its Annual Report on Form 10-K for the year ended December 31, 2012.

Item 5. Other Information

Reports on Form 8-K

None.

Item 6. Exhibits

	31.	Certification Pursuant to Rule 13a-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

	32.	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

	101.INS	XBRL Instance Document*

	101.SCH	XBRL Taxonomy Extension Schema Document*

	101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document*

	101.DEF	XBRL Taxonomy Extension Definition Linkbase Document*

	101.LAB	XBRL Taxonomy Extension Label Linkbase Document*

	101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document*

	* In accordance with Regulation S-T, the XBRL-related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall be deemed to be “furnished” and not “filed.”

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

REALMARK PROPERTY INVESTORS LIMITED PARTNERHIP – II

November 19, 2013		/s/ Joseph M. Jayson
Date		Joseph M. Jayson
		Individual General Partner,
		Principal Executive Officer and
		Principal Financial Officer

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REALMARK PROPERTY INVESTORS LTD PARTNERSHIP II Reports

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