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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 March 31, 2004
/___/ Transition report pursuant to Section 13 or 15(d) of the
Securities Act of 1934
for the transition period from ______________ to ________________.
Commission File Number 2-83291
DSI REALTY INCOME FUND VII, A California Limited Partnership
(Exact name of registrant as specified in its charter)
California_______________________________________95-3871044
(State or other jurisdiction of (I.R.S. Employer
incorporation) Identification No.)
6700 E. Pacific Coast Hwy, Long Beach, California 90803
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code-(562)493-8881
_________________________________________________________________
Former name, former address and former fiscal year, if changed
since last report.
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__.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The information required by Rule 10-01 of Regulation S-X is
included in the Quarterly Report to the Limited Partners of Registrant for
the period ended March 31, 2004 which is attached hereto as Exhibit "20"
and incorporated herein by this reference.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Registrant incorporates by this reference its Quarterly Report to
Limited Partners for the period ended March 31, 2004.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8K.
(a) Attached hereto as Exhibit "20" is Registrant's Quarterly
Report to Limited Partners for the period ended March 31, 2004.
(B) Registrant did not file any reports on Form 8-K for the
period reported upon.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: April 30, 2004 DSI REALTY INCOME FUND VII
A California Limited Partnership
(Registrant)
By____\s\ Robert J. Conway_____
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial Officer
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: April 30, 2004 DSI REALTY INCOME FUND VII
A California Limited Partnership
(Registrant)
By__\s\ Robert J. Conway________
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial Officer
April 30, 2004
QUARTERLY REPORT TO THE LIMITED PARTNERS
OF DSI REALTY INCOME FUND VII
DEAR LIMITED PARTNERS:
We are pleased to enclose the Partnership's unaudited financial statements
for the period ended March 31, 2004. The following is Management's
discussion and analysis of the Partnership's financial condition and
results of its operations.
For the three-month periods ended March 31, 2004 and 2003, total revenues
decreased 1.2% from $650,704 to $642,833, total expenses increased 1.1% from
$312,011 to $315,425 and other income decreased from $166 to $160. As a
result, net income decreased 3.3% from $338,859 for the three-month period
ended March 31, 2003, to $327,568 for the same period in 2004. Occupancy
levels for the Partnership's six mini-storage facilities averaged 82.6% for
the three month period ended March 31, 2004, and 87.0% for the same period
in 2003. Rental revenue decreased as a result of lower occupancy rates,
partially offset by higher unit rental rates. The Partnership is continuing
its marketing effort to attract and keep new tenants in its various mini-
storage facilities. Operating expenses increased approximately $5,900 (2.5%)
primarily as a result of increases in maintenance and repair and salaries
expenses, partially offset by a decrease in advertising expense. General and
administrative expenses remained relatively constant.
The General Partners will continue their policy of funding the continuing
improvement and maintenance of Partnership properties with cash generated
from operations. The Partnership's financial resources appear to be adequate
to meet its needs. The General Partners anticipate distributions to the
Limited Partners to remain at the current level for the foreseeable future.
We are not enclosing a copy of the Partnership Form 10-Q as filed with the
Securities and Exchange Commission since all the information set forth
therein is contained either in this letter or in the attached financial
statements. However, if you wish to receive a copy of said report, please
send a written request to DSI Realty Income Fund VII, P.O. Box 357,
Long Beach, California 90801.
Very truly yours,
DSI REALTY INCOME FUND VII
By: DSI Properties, Inc., as
General Partner
By /s/ Robert J. Conway
____________________________
ROBERT J. CONWAY, President
DSI REALTY INCOME FUND VII
(A California Real Estate Limited Partnership)
BALANCE SHEETS(UNAUDITED)
MARCH 31, 2004 AND DECEMBER 31, 2003
March 31, December 31,
2004 2003
ASSETS
CASH AND CASH EQUIVALENTS $ 728,118 $ 674,918
PROPERTY, NET 2,089,800 2,089,800
OTHER ASSETS 68,916 68,718
TOTAL $2,886,834 $2,833,436
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
LIABILITIES $ 573,228 $ 604,974
PARTNERS' EQUITY (DEFICIT):
General Partners (84,632) (85,484)
Limited Partners 2,398,238 2,313,946
Total partners' equity 2,313,606 2,228,462
TOTAL $2,886,834 $2,833,436
See accompanying notes to financial statements(unaudited).
STATEMENTS OF INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003
March 31, March 31,
2004 2003
REVENUES:
Rental $ 642,833 $ 650,704
EXPENSES:
Operating 245,685 239,774
General and administrative 69,740 72,237
Total expenses 315,425 312,011
OPERATING INCOME $ 327,408 $ 338,693
OTHER INCOME
Interest 160 166
NET INCOME $ 327,568 $ 338,859
AGGREGATE NET INCOME ALLOCATED TO:
Limited partners $ 324,292 $ 335,470
General partners 3,276 3,389
TOTAL $ 327,568 $ 338,859
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 13.51 $ 13.98
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 24,000 24,000
See accompanying notes to financial statements(unaudited).
STATEMENTS OF CHANGES IN PARTNERS' EQUITY (DEFICIT)(UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2004
GENERAL LIMITED
PARTNERS PARTNERS TOTAL
BALANCE AT JANUARY 1, 2004 ($85,484) $2,313,946 $2,228,462
NET INCOME 3,276 324,292 327,568
DISTRIBUTIONS (2,424) (240,000) (242,424)
BALANCE AT MARCH 31, 2004 ($84,632) $2,398,238 $2,313,606
See accompanying notes to financial statements(unaudited).
STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003
March 31, March 31,
2004 2003
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 327,568 $ 338,859
Adjustments to reconcile net
income to net cash provided
by operating activities:
Changes in assets and
liabilities:
Increase in other assets (198) 0
Decrease in liabilities (31,746) (18,994)
Net cash provided by
operating activities 295,624 319,865
CASH FLOWS FROM FINANCING ACTIVITIES -
Distributions to partners (242,424) (242,424)
NET INCREASE IN CASH AND
CASH EQUIVALENTS 53,200 77,441
CASH AND CASH EQUIVALENTS:
At beginning of period 674,918 497,970
At end of period $ 728,118 $ 575,411
See accompanying notes to financial statements (unaudited).
DSI REALTY INCOME FUND VII
(A California Real Estate Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. GENERAL
DSI Realty Income Fund VII (the "Partnership"), has two general partners
(DSI Properties, Inc., and Diversified Investors Agency) and limited
partners owning 24,000 limited partnership units. The Partnership was formed
under the California Uniform Limited Partnership Act for the primary purpose
of acquiring and operating real estate.
The accompanying financial information as of March 31, 2004, and for
the periods ended March 31, 2004, and 2003 is unaudited. Such financial
information includes all adjustments, which are considered necessary by the
Partnership's management for a fair presentation of the results for the
periods indicated.
2. PROPERTY
Properties owned by the Partnership are all mini-storage facilities.
Depreciation is calculated using the straight line method over the
estimated useful life of 15 years. The total cost of property and
accumulated depreciation at March 31, 2004, is as follows:
Land $ 2,089,800
Buildings and improvements 7,685,522
Equipment 60,760
Total 9,836,082
Less: Accumulated Depreciation ( 7,746,282)
Property - Net $ 2,089,800
3. NET INCOME PER LIMITED PARTNERSHIP UNIT
Net income per limited partnership unit is calculated by dividing the net
income allocated to the limited partners by the number of limited
partnership units outstanding during the period.
4. CONTROLS AND PROCEDURES
Within 90 days prior to the date of this report, the Partnership evaluated
the effectiveness of its disclosure controls and procedures. This evaluation
was performed by the Partnership's Controller with the assistance of the
Partnership's President and the Chief Executive Officer. These disclosure
controls and procedures are designed to ensure that the information required
to be disclosed by the Partnership in its periodic reports filed with the
Securities and Exchange Commission (the Commission) is recorded, processed,
summarized and reported, within the time periods specified by the Commission's
rules and forms, and that the information is communicated to the certifying
officers on a timely basis. Based on this evaluation, the Partnership con-
cluded that its disclosure controls and procedures were effective. There
have been no significant changes in the Parnership's internal controls or in
other factors that could significantly affect the internal controls sub-
sequent to the date of their evaluation.
CERTIFICATIONS
I, Robert J. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund VII;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its con-
solidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effec-
tiveness of the disclosure controls and procedures based on our evalu-
ation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to re-
cord, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's in-
ternal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls sub-
sequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: April 30, 2004
Robert J. Conway
Chief Executive Officer
CERTIFICATIONS
I, Richard P. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund VII;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its con-
solidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effec-
tiveness of the disclosure controls and procedures based on our evalu-
ation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to re-
cord, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's in-
ternal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls sub-
sequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: April 30, 2004
Richard P. Conway
Vice President
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of DSI Realty Income Fund VII (the
"Partnership") on Form 10-Q for the period ending March 31, 2004 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Robert J. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
Robert J. Conway
Chief Executive Officer
April 30, 2004
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of DSI Realty Income Fund VII (the
"Partnership") on Form 10-Q for the period ending March 31, 2004 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Richard P. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
Richard P. Conway
Vice President
April 30, 2004