UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
{ X } ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2001
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 000-16698
Brown-Benchmark Properties Limited Partnership
(Exact Name of Registrant as Specified in its Charter)
Delaware 31-1209608
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
225 East Redwood Street, Baltimore, Maryland 21202
(Address of Principal Executive Offices) (Zip Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None
Securities registered pursuant to section 12(g) of the Act:
Assignee Units of Limited Partnership Interests
(Title of class)
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_____
As of December 31, 2001, there were 499,600 Units of Assignee Limited
Partnership Interests held by non-affiliates of the Registrant. Because there is
not an established public trading market for the Units, the aggregate market
value of the Units held by non-affiliates of the Registrant cannot be
calculated.
Documents Incorporated by Reference
The Annual Report for 2001 is incorporated by reference.
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
INDEX
Page (s)
Part I
Item 1. Business 3
Item 2. Properties 4
Item 3. Legal Proceedings 4
Item 4. Submission of Matters to a Vote
of Security Holders 4
Part II
Item 5. Market for Registrant's Common Equity
and Related Partner Matters 5
Item 6. Selected Financial Data 5
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6-7
Item 7a. Quantitative and Qualitative Disclosures About Market Risk 8
Item 8. Financial Statements and Supplementary Data 8
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 8
Part III
Item 10. Directors and Executive Officers of the Registrant 9-10
Item 11. Executive Compensation 10
Item 12. Security Ownership of Certain Beneficial Owners
and Management 11
Item 13. Certain Relationships and Related Transactions 11
Part IV
Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K 12-15
Signatures 16
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
PART I
Item 1. Business
Brown-Benchmark Properties Limited Partnership (the "Partnership") is a
Delaware limited partnership formed on June 1, 1987. The Partnership was formed
to develop and operate three residential multifamily communities ("Properties")
in Ohio. See Item 2, Properties, herein. The offering proceeds raised from the
sale of the Assignee Units (the "Units") and moderate leverage enabled the
Partnership to acquire the land and develop the three Properties. Construction
was completed at all three Properties by September of 1989.
The Partnership's objectives are to (i) preserve and protect
Unitholders' capital; (ii) obtain capital appreciation through increases in the
value of the Properties; and (iii) provide quarterly cash distributions to
Unitholders from income generated by the Properties' rental income.
The General Partners of the Partnership are Brown-Benchmark AGP, Inc.,
a Maryland corporation (the "Administrative General Partner"), and Benchmark
Equities, Inc., an Ohio corporation (the "Development General Partner"). On
March 4, 2002, the Partnership filed a preliminary Schedule 14A Proxy Statement
pursuant to Section 14(a) of the Securities Exchange Act of 1934 soliciting the
Unitholders' approval of the assignment of the entire General Partnership
interest of the Development General Partner to AIMCO/NHP Properties, Inc. or one
of its affiliates. NHP is a wholly owned subsidiary of AIMCO Properties, L.P., a
Delaware limited partnership, and the assignee of the existing Management
Agreements on each of the Partnerships three apartment communities (see below).
AIMCO Properties L.P. is the operating partnership of Apartment Investment and
Management Company, a Maryland corporation which is a publicly traded real
estate investment trust. The Unitholders' consents are not expected to be
finalized prior to the filing of this Form 10-K.
Pursuant to the Registration Statement, a minimum of 320,000 Units and
a maximum of 500,000 Units were registered under the Securities and Exchange Act
of 1933, as amended. On February 19, 1988, the minimum offering of $8,000,000
was subscribed and investors holding 320,000 Units were recognized on the books
of the Partnership, and on March 23, 1988, the Partnership completed the maximum
offering of $12,500,000 with the recognition on the books of the Partnership of
investors purchasing the remaining 180,000 Units.
Each of the Partnership's three Properties was constructed by an
affiliate of the Development General Partner under the terms of a guaranteed
fixed-price development agreement. The Partnership's investment in real estate
at December 31, 2001 was $25,350,961 before depreciation charges, of which
approximately 53% was funded by long-term loans.
The Partnership's residential apartment communities face competition
from similar properties in their locations. The competition is based on the
proximity of the Properties to area employers and commercial and retail
facilities. In addition, consideration has been given to the comparability of
quality, amenities, rental rates and unit sizes. The Partnership's annual report
discusses operations and current leasing information at the properties and is
incorporated by reference in Item 14. Exhibits, Financial Statement Schedules
and Reports on Form 8-K, herein.
Pursuant to the terms of a Property Management Agreement with the
Partnership, each of the Properties is managed by Benchmark Properties, Inc.,
the Property Manager. The Property Management Agreements are renewable on a
year-to-year basis and may be terminated by the Partnership upon 60 days notice
without cause. The Property Manager receives a Property Management Fee of 4.5%
of gross monthly operating revenues of each Property. See Note 5. "Related Party
Transactions," in Item 8. Financial Statements and Supplementary Data, herein.
Under the terms of the Property Management Agreements, the Property Manager is
responsible for performing, or paying others to perform on its behalf, all
leasing-related and other property management services for the Properties. The
management and administration of the Partnership is performed by the General
Partners or an affiliate thereof. Effective January 7, 2002, the Administrative
General Partner has consented to the assignment of the Management Agreements to
NHP Management Company in anticipation of the assignment of the General
Partnership interest of the Development General Partner to AIMCO/NHP Properties,
Inc. or one of its affiliates. (see above)
3
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Item 2. Properties
The Partnership owns land and improvements as described below:
Gross Investment 2001
Name and Location in Property Rental Income
Woodhills $7,846,134 $1,223,799
West Carrollton,
Montgomery County,
Ohio
Approximately 15 acres as a 186-unit multifamily community, consisting of 12
one-story villas, 54 two-story town-houses, 5 three-story garden-style buildings
containing 120 units, a swimming pool, volleyball court, and a clubhouse.
Oakbrook $7,803,788 $1,228,092
Reynoldsburg,
Franklin County, Ohio
Approximately 22 acres as a 181-unit multifamily community, consisting of 20
one-story villas, 81 two-story townhouses, 5 two-story garden-style buildings
containing 80 units, a swimming pool, volleyball court and a clubhouse.
Deerfield $9,701,039 $1,642,745
Union Township
(Greater Cincinnati area)
Clermont County,
Ohio
Approximately 19 acres as a 223-unit multifamily community, consisting of 32
one- and two-story apartment buildings, a swimming pool, volleyball court and a
clubhouse.
For additional information on the Properties, reference is made to Item
7. Management's Discussion and Analysis of Financial Condition and Results of
Operations, herein.
Item 3. Legal Proceedings
The Partnership is not subject to any material pending legal
proceedings.
Item 4. Submission of Matters to a Vote of Security Holders
There were no matters submitted to the security holders for a vote
during the last quarter of the fiscal year covered by this report.
4
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
PART II
Item 5. Market for Registrant's Common Equity and Related Partner Matters
An established public trading market for the Units does not exist and
the Partnership does not anticipate that a public market will develop. Transfer
of Units by an investor and purchase of Units by the Partnership may be
accommodated under certain terms and conditions. The Partnership Agreement
imposes certain limitations on the transfer of Units and may restrict, delay or
prohibit a transfer primarily if:
o the transfer of Units would result in 50% or more of all Units
having been transferred by assignment or otherwise within a
12-month period;
o such a transfer would be a violation of any federal or state
securities laws that may cause the Partnership to be classified
other than as a partnership for federal income tax purposes;
o such transfers would cause the Partnership to be treated as a
"publicly traded partnership" under Sections 7704 and 469(k) of
the Internal Revenue Code; and
o the transfer of Units would cause a technical termination of the
Partnership within meaning of Section 708(b)(1)(A) of the Internal
Revenue Code.
As of December 31, 2001, there were 477 holders of 500,000 Units of the
registrant. See Item 12, Security Ownership of Certain Beneficial Owners and
Management, herein.
Annual distributions of cash to the investors were $765,368, $765,368,
$765,368, $765,352 and $574,009 for the years ended December 31, 2001, 2000,
1999, 1998 and 1997, respectively, of which 98% was allocated to Unitholders and
2% to the General Partners. See Item 8, Financial Statements and Supplementary
Data, herein.
Item 6. Selected Financial Data
The following selected financial data should be read in conjunction
with the financial statements and accompanying notes in Item 8, Financial
Statements and Supplementary Data, herein.
2001 2000 1999 1998 1997
Rental income $ 4,094,636 $ 4,081,685 $ 3,996,371 $ 3,888,213 $ 3,843,316
Net income/(loss) 74,040 149,434 162,838 40,949 (56,798)
Net income/(loss)
per Unit .15 .29 .32 .08 (.11)
Total assets 12,831,516 13,754,230 14,636,231 15,470,731 16,405,766
Mortgage loans
payable 13,448,501 13,710,478 13,953,098 14,177,678 14,385,782
Partners' capital (1,375,089) (683,761) (67,827) 534,703 1,259,106
(deficit)
Cash distribution paid
per Unit of assignee
limited partnership
interest from:
operations 1.31 1.45 1.42 1.40 1.13
return of capital .19 .05 .08 .10 -
5
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Liquidity and Capital Resources
The Partnership's liquidity is largely dependent on its ability to
maintain reasonably high occupancy levels, achieve rental rate increases as the
respective markets allow and to control operating expenses. The Partnership
currently has sufficient liquid assets from its rental revenues to satisfy its
anticipated operating expenditures and debt service obligations.
During 2001, the Partnership maintained a distribution to its partners
of 6% on invested capital. Operating net cash flow, as defined in the
Partnership Agreement, generated from the three apartment communities totaled
$669,388, and funded 87% of the distribution while the balance was funded from
reserves. On February 14, 2002, the Partnership made a cash distribution to its
partners totaling $191,342, representing an annualized return of 6% on invested
capital. Based upon the preliminary 2002 budget, operating cash flow is expected
to fully fund a distribution rate of 6% in 2002.
The Partnership's long-term debt with Canada Life Assurance Company
matures June 1, 2002. The General Partners have had discussions with our lender
and expect to receive a loan commitment to extend our existing loan for one
year. All terms are expected to remain the same, except that the interest rate
should decrease to 7.5% from 7.7%. There will be no prepayment penalty and the
loan may be paid off following a sixty-day written notice to the lender. The
General Partners expect to evaluate the possibility of selling the portfolio
during our extension period. Should an acceptable selling price not be
achievable, we expect to secure long term financing.
The Partnership does not anticipate any significant capital
improvements or repair costs that might adversely impact its liquidity in 2002
Results of Operations
Rental revenues for the three apartment communities increased $12,951,
or .3%, for the year ended December 31, 2001as compared to the year ended
December 31, 2000 versus an increase of $85,314, or 2.1% for the year ended
December 31, 2000 compared to the year ended December 31, 1999. The increases in
2001 and 2000 were a result of higher rental rates at each of the properties
resulting in revenue growth despite decreases in aggregate occupancy levels. The
average monthly rental rate (inclusive of concessions) for the portfolio has
increased from $593 in 1999 to $612 in 2000 to $624 in 2001, representing an
increase of approximately 3% in 2000 and 2% in 2001. Collectively, the
properties' average occupancy level was 94% in 1999, 93% in 2000 and 91% in
2001.
Management remains diligent in its efforts to control operating
expenditures at each the three communities while preserving the invested
capital. Total operating expenses, excluding interest charges, depreciation and
amortization costs, increased by 4.3% in 2001 compared to 2000 and 7.1% in 2000
compared to 1999. The majority of the increase in 2001 was due to normal
inflation and the continued exterior painting of the communities. The increase
in 2000 was due primarily to higher maintenance and repair costs, including
exterior painting of a portion of the communities.
The proportionately larger increase in operating expenses (excluding
interest charges, depreciation and amortization) versus revenues during 2001 and
2000 resulted in decreases of approximately $84,300 (or 3.9%) and $32,700 (or
1.5%), respectively in the combined properties' net operating income.
Interest expense on the Partnership's mortgage loans decreased $19,388
and $18,039 in 2001 and 2000 respectively, due to principal payments totaling
$261,977 in 2001, versus $242,620 in 2000 and $224,580 in 1999.
Capital expenditures for all three communities during 2001 totaled
$107,131 and consisted primarily of carpet replacements and upgrades to the unit
interiors. Similar improvements to the properties totaled $123,149 and $164,289
in 2000 and 1999 respectively.
The average occupancy level experienced at the Oakbrook property in
Columbus, Ohio, was 91% in 2001, down from 93% in 2000. The decrease in
occupancy resulted from increased competition from new communities
6
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations (continued)
opened during the last two years. The average market rental rate at Oakbrook
increased from $595 in 2000 to $616 in 2001. As a result, revenues at Oakbrook
increased by $17,597 in 2001 versus 2000. The apartment market in Columbus
remains extremely competitive given the new supply coupled with the favorable
environment for first-time home buyers resulting from low interest rates.
Management expects to increase marketing efforts in 2002 in an attempt to
improve our property's share of the market.
At the Woodhills property, in Dayton, Ohio, the average occupancy level
in 2001 was 90%, down from 92% in 2000. The average market rental rate
(inclusive of rental concessions) increased from $594 in 2000 to $603 in 2001.
Revenues at Woodhills decreased by $8,407 in 2001 versus 2000. The apartment
market in Dayton remains competitive. There has not been significant growth in
the local economy and low interest rates have made home ownership a more
affordable alternative. Management is focused on tenant retention to maintain
the property's occupancy level during this difficult environment.
While the average effective rental rate at Deerfield, our Cincinnati,
Ohio, property increased from $641 in 2000 to $648 in 2001, the property's
occupancy level slipped from 95% to 93%. As a result, only a modest revenue
increase of $3,761 was achieved at the property during 2001 when compared to
2000. Management's goal in 2002 is to improve its occupancy levels through
increased marketing efforts. Significant rate increases are not expected in the
near term.
During 2002, management will strive to improve the portfolio's net
operating income by achieving revenue growth through improved occupancy levels,
while controlling operating expenditures.
Critical Accounting Policies
Critical accounting policies are those that are both important to the
presentation of financial condition and results of operations and require
management's most difficult, complex or subjective judgments. The Partnership's
critical accounting policy relates to the evaluation of impairment of long-lived
assets.
If events or changes in circumstances indicate that the carrying value
of a property to be held and used may be impaired, a recoverability analysis is
performed based on estimated undiscounted cash flows to be generated from the
property in the future. If the analysis indicates that the carrying value is not
recoverable from future cash flows, the property is written down to estimated
fair value and an impairment loss is recognized. If the Partnership decides to
sell a property, it evaluates the recoverability of the carrying amount of the
assets. If the evaluation indicates that the carrying value is not recoverable
from estimated net sales proceeds, the property is written down to estimated
fair value less costs to sell and an impairment loss is recognized. The
estimates of cash flows and fair values of the properties are based on current
market conditions and consider matters such as rental rates and occupancies for
the property and comparable properties, recent sales data for comparable
properties and, where applicable, contracts or the results of negotiations with
purchasers or prospective purchasers. These estimates are subject to revision as
market conditions and the Partnership's assessment of them change.
New Accounting Pronouncement
In October 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." SFAS No. 144 supersedes SFAS No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" and APB Opinion No. 30, "Reporting the Results of
Operations - Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions." SFAS
No. 144 does not change the fundamental provisions of SFAS No. 121; however, it
resolves various implementation issues of SFAS No. 121 and establishes a single
accounting model for long-lived assets to be disposed of by sale. It retains the
requirement of APB Opinion No. 30 to report separately discontinued operations
but extends that reporting to a component of an entity that either has been
disposed of (by sale, abandonment, or in distribution to owners) or is
classified as held for sale. We do not believe that adoption of SFAS No. 144 in
2002 will have a material effect on the Partnership's financial statements.
7
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Item 7a. Quantitative and Qualitative Disclosures About Market Risk
The Partnership has exposure to changing interest rates since its
long-term debt matures on June 1, 2002. The General Partners have had
discussions with the current lender to extend the existing loans for a period of
one year. All terms are expected to remain the same, except that the interest
rate should decrease from 7.7% to 7.5%. The General Partners expect to evaluate
the possibility of selling the portfolio during the extension period. Should an
acceptable selling price not be achievable, we expect to secure long-term
financing at the then current market rate.
Item 8. Financial Statements and Supplementary Data
Index to Financial Statements:
Page(s)
Herein Annual Report
Independent Auditors' Report 13 4
Balance Sheets 5
Statements of Operations 6
Statements of Partners' Capital (Deficit) 7
Statements of Cash Flows 8
Notes to Financial Statements 9-15
Financial Statement Schedule
Schedule III - Real Estate and
Accumulated Depreciation 14-15
All other schedules are omitted because they are not applicable, or not
required, or because the required information is included in the financial
statements or notes thereto.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
8
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
PART III
Item 10. Directors and Executive Officers of the Registrant
The General Partners of the Partnership are Brown-Benchmark AGP, Inc.,
the Administrative General Partner, and Benchmark Equities, Inc., the
Development General Partner. The Partnership's principal executive offices are
located at 225 East Redwood Street, Baltimore, Maryland 21202, telephone (410)
727-4083. The General Partners have primary responsibility for overseeing the
performance of those who contract with the Partnership, as well as making
decisions with respect to the financing, sale and liquidation of the
Partnership's assets. The General Partners are responsible for all reports to
and communications with investors and others, all distributions and allocations
to investors, the administration of the Partnership's business and all filings
with the Securities and Exchange Commission and other federal or state
regulatory authorities. The Partnership's Partnership Agreement provides for the
removal of a General Partner and the election of successor general partners by
investors holding a majority of the Units.
The directors and executive officers of the General Partners are as
follows:
The Development General Partner
Benchmark Equities, Inc., the Development General Partner, is an Ohio
corporation. Affiliated companies of the Development General Partner include its
parent, Benchmark Communities, Inc., formerly known as "Vindale Corporation,"
which was organized in 1946, and since 1978 has concentrated on the development,
construction and marketing of residential developments, Benchmark Homes, Inc.,
the general contractor for the properties and Benchmark Properties, Inc., the
property manager at the properties.
The Development General Partner and its Affiliates were engaged in all
aspects of the building and real estate development process, including
manufacturing the industrialized housing components in their plant, developing
the site, constructing the components on-site, landscaping and paving the site,
marketing the completed housing units and financing.
The following individuals are the directors and principal officers of
Benchmark Equities, Inc.:
Daniel P. Riedel, age 62, has been the Chairman, President and Director
of Benchmark Equities, Inc. since its inception in 1987. His responsibilities
include administration, marketing, finance and planning. His background includes
over 31 years in manufacturing, land development and marketing. Mr. Riedel has
been an officer or director of Benchmark Communities, Inc. for 27 years and has
held management positions for his entire 37 year career with Benchmark
Communities, Inc. He graduated Cum Laude from Michigan State University in 1961,
majoring in Industrial Management.
Deborah J. Maxson, age 39, has been Treasurer of Benchmark Equities, Inc.
and President of Benchmark Properties, Inc. since 1998. Prior to 1998 she was
the Controller of Benchmark Properties, Inc. from 1988-1998. She has been with
Benchmark since 1986. She attended Fort Sterlacom Community College majoring in
accounting.
The Administrative General Partner
Brown-Benchmark AGP, Inc., the Administrative General Partner, is a
Maryland corporation and is wholly owned by Alex. Brown Realty, Inc. The
Administrative General Partner is responsible for administering the business of
the Partnership including providing clerical services, investor communications
services and reports, and for making all reports and filings to regulatory
authorities. The Administrative General Partner is reimbursed for such services
to the Partnership on a cost basis.
9
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Item 10. Directors and Executive Officers of the Registrant (continued)
The Administrative General Partner (continued)
The following individuals are the directors and principal officers of
Brown-Benchmark AGP, Inc.:
John M. Prugh, age 53, has been a Director and President of the
Administrative General Partner since 1987 and of Alex. Brown Realty, Inc. and
Armata Financial Corp. since 1984. Mr. Prugh graduated from Gettysburg College
in 1970, and was designated a Certified Property Manager by the Institute of
Real Estate Management in 1979. He has worked in property management for H. G.
Smithy Co., in Washington, D.C., and Dreyfus Bros., Inc. in Bethesda, Maryland.
Since 1977, Mr. Prugh has been involved in managing, administering, developing
and selling real estate investment projects sponsored by Alex. Brown Realty,
Inc. and its subsidiaries.
Peter E. Bancroft, age 49, has been the Director and Vice President of the
Administrative General Partner since its inception in 1987. He has also been a
Senior Vice President of Alex. Brown Realty, Inc. and Armata Financial Corp.
since 1983. Mr. Bancroft graduated from Amherst College in 1974, attended the
University of Edinburgh, and received a J.D. degree from the University of
Virginia School of Law in 1979. Prior to joining Alex. Brown Realty, Inc. in
1983, Mr. Bancroft held legal positions with Venable, Baetjer and Howard and T.
Rowe Price Associates, Inc.
Terry F. Hall, age 55, has been the Secretary of the Administrative General
Partner and a Vice President and Secretary of, and Legal Counsel for, Alex.
Brown Realty, Inc. since 1989. Mr. Hall graduated from the University of
Nebraska-Lincoln in 1968, and received a J.D. degree from the University of
Pennsylvania Law School in 1973. Prior to joining Alex. Brown Realty, Inc. in
1989, Mr. Hall was a Partner at the law firm of Venable, Baetjer and Howard from
1981 to 1986 and an associate at the same firm from 1973 to 1981.
Timothy M. Gisriel, age 45, has been the Treasurer of the Administrative
General Partner and of Alex. Brown Realty, Inc. and Armata Financial Corp. since
1990. He was Controller of Alex. Brown Realty, Inc. and Armata Financial Corp.
from 1984 through 1990. Mr. Gisriel graduated from Loyola College in 1978 and
received his Masters of Business Administration degree from the Robert G.
Merrick School of Business, University of Baltimore in 1993. Prior to joining
Alex. Brown Realty, Inc. in 1984, Mr. Gisriel was an audit supervisor in the
Baltimore office of Coopers & Lybrand. He is a Maryland Certified Public
Accountant.
There is no family relationship among the officers and directors of the
Development General Partner or the Administrative General Partner.
Item 11. Executive Compensation
The officers and directors of the Administrative General Partner and
the Development General Partner received no compensation from the Partnership.
The General Partners are entitled to receive a share of cash distributions
and a share of profits and losses as described in the Agreement of Limited
Partnership. (See Note 9. "Partners' Capital" in Item 8. Financial Statements
and Supplementary Data, herein.)
For a discussion of compensation and fees to which the General Partners
are entitled, see Item 13, Certain Relationships and Related Transactions,
herein.
10
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following are known to the Partnership to own beneficially more
than 5% of the outstanding assignee units of limited partnership interest of the
Partnership.
Amount of Nature of
Title of Class Name of Beneficial Owner Beneficial Ownership* Percent of Class
Assignee Units Equity Resources Group, Inc. 33,500 6.7%
of Limited 14 Story Street
Partnership Interest Cambridge, MA 02138
Assignee Units McKenzie Patterson, Inc** 22,980 4.6%**
of Limited 1640 School Street
Partnership Interest Moraga, CA 94556
*The cumulative assignee units of limited partnership disclosed above
are owned by multiple entities that are controlled by the above named beneficial
owners.
**While McKenzie Patterson, Inc. held less than 5% of the Units as of
December 31, 2001, on December 27, 2001 certain entities controlled by McKenzie
Patterson, Inc. commenced a tender offer to purchase for cash up to 100,000
Units at a purchase price of $15 per unit. As of the date of this report, the
Partnership is unaware whether any Units have been tendered in response to the
offer, but if they have, McKenzie Patterson, Inc. may hold greater than 5% of
the outstanding Units.
The Assignor Limited Partner, Brown-Benchmark Holding Co., Inc. an
affiliate of the Administrative General Partner, holds 40 Units representing a
beneficial interest in limited partnership interests in the Partnership. The
Units held by the Assignor Limited Partner have all rights attributable to such
Units under the Limited Partnership Agreement except that these Units are
nonvoting.
The General Partners each have a 1% interest in the Partnership as
General Partners, but hold no Units.
There are no arrangements, known to the Partnership, the operation of
which may at a subsequent date result in a change of control of the registrant.
Item 13. Certain Relationships and Related Transactions
The General Partners and their affiliates have and are permitted to
engage in transactions with the Partnership. For a summarization of fees paid
during 2001, 2000 and 1999, and to be paid to the General Partners and their
affiliates at December 31, 2001, see Note 5. "Related Party Transactions" in
Item 8. Financial Statements and Supplementary Data, herein.
11
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a)1. Financial Statements: See Index to Financial Statements and
Supplementary Data in Item 8 on page 8, herein.
2. Financial Statement Schedule: See Index to Financial Statements and
Supplementary Data in Item 8 on
page 8, herein.
3. Exhibits:
(3, 4) Agreement of Limited Partnership on pages 1 through 39
of Exhibit A to the Fund's Registration Statement on Form
S-11 (File No. 33-38437) incorporated herein by reference.
(10) Assignment of Management Rights dated January 7, 2002 in
which Benchmark Properties, Inc., are affiliate of the
Development General Partner, assigns its rights under the
existing management agreement of each of the three
apartment communities to NHP Management Company.
(13) Annual Report for 2001.
(b) Reports on Form 8-K: None.
12
INDEPENDENT AUDITORS' REPORT
The Partners
Brown-Benchmark Properties Limited Partnership:
Under date of January 25, 2002, we reported on the balance sheets of
Brown-Benchmark Properties Limited Partnership as of December 31, 2001 and 2000,
and the related statements of operations, partners' capital (deficit) and cash
flows for each of the years in the three-year period ended December 31, 2001
which are included in the Annual Report on Form 10-K for 2001. In connection
with our audits of the aforementioned financial statements, we also audited the
related financial statement schedule as listed in the accompanying index. This
financial statement schedule is the responsibility of the Partnership's
management. Our responsibility is to express an opinion on the financial
statement schedule based on our audits.
In our opinion, such financial statement schedule, when considered in relation
to the basic financial statements taken as a whole, presents fairly, in all
material respects, the information set forth therein.
/s/ KPMG LLP
Baltimore, Maryland
January 25, 2002
13
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP Page 1
SCHEDULE III. REAL ESTATE AND ACCUMULATED DEPRECIATION
31-Dec-01
COLUMN A COLUMN B C O L U M N C COLUMN D
- ----------------------------------------------------------------------------------------------
COST CAPITAL
SUB. TO
INITIAL COST TO THE PARTNERSHIP ACQUISITION
------------------------------- ------------------
FURN. FURN.
BLDG. & FIX & BLDG. & FIX. &
DESCRIPTION ENCUMBRANCES LAND IMPROV. EQUIP IMPROV. EQUIP
- ----------------------------------------------------------------------------------------------
WOODHILLS 4,080,925 245,000 6,608,969 540,981 118,511 332,673
WEST CARROLLTON, OHIO
186-Unit garden apartment
community on approx. 15 acres.
OAKBROOK 3,988,176 455,000 6,320,080 528,603 143,024 357,081
REYNOLDSBURG, OHIO
181-Unit garden apartment
community on approx. 22 acres.
DEERFIELD 5,379,400 557,000 8,129,417 669,000 96,567 249,055
UNION TOWNSHIP, OHIO
223-Unit garden apartment
community on approx. 19 acres.
------------- ---------- ----------- ---------- -------- --------
$13,448,501 $1,257,000 $21,058,466 $1,738,584 $358,102 $938,809
============= ========== =========== ========== ======== ========
14
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP Page 2
SCHEDULE III. REAL ESTATE AND ACCUMULATED DEPRECIATION
31-Dec-01
COLUMN A C O L U M N E COLUMN F COLUMN G COL. H COLUMN I
- ----------------------------------------------------------------------------------------------------------------------------
GROSS AMOUNT AT WHICH CARRIED AT
CLOSE OF PERIOD
----------------------------------------
FURN. LIFE ON WHICH DEPREC
BLDG. & FIX ACCUM. DATE OF DATE IN LATEST INC. STMT
DESCRIPTION LAND IMPROV. EQUIP TOTAL DEPR CONST. ACQ. IS COMPUTED
- ----------------------------------------------------------------------------------------------------------------------------
WOODHILLS 245,000 6,727,480 873,654 7,846,134 4,290,497 1987/1988 10/87 Real prop. -25 yr S/L
WEST CARROLLTON, OHIO Pers. prop.-10 yr S/L
186-Unit garden apartment
community on approx. 15 acres.
OAKBROOK 455,000 6,463,104 885,684 7,803,788 4,114,090 1987/1988 10/87 Real prop. -25 yr S/L
REYNOLDSBURG, OHIO Pers. prop.-10 yr S/L
181-Unit garden apartment
community on approx. 22 acres.
DEERFIELD 557,000 8,225,984 918,055 9,701,039 4,996,141 1988/1989 08/88 Real prop. -25 yr S/L
UNION TOWNSHIP, OHIO Pers. prop.-10 yr S/L
223-Unit garden apartment
community on approx. 19 acres.
----------------------------------------------------------
$1,257,000 $21,416,568$2,677,393 $25,350,961$13,400,728
==========================================================
(1) 2001 2000 1999
REAL ACCUM. REAL ACCUM. REAL ACCUM.
ESTATE DEP ESTATE DEPREC. ESTATE DEPREC.
----------------------- ---------------------- ------------------------
BALANCE AT BEGINNING OF PERIOD $25,243,830 $12,456,944 $25,120,681 $11,523,622 $24,956,391 $10,588,999
ADDITIONS 107,131 943,784 123,149 933,322 164,290 934,623
----------------------- ----------------------- -----------------------
BALANCE AT CLOSE OF PERIOD $25,350,961 $13,400,728 $25,243,830 $12,456,944 $25,120,681 $11,523,622
======================= ======================= =======================
(2) AGGREGATE COST FOR FEDERAL INCOME TAX PURPOSES IS $25,350,961 AT
DECEMBER 31, 2001.
(3) SEE NOTE 5 OF NOTES TO FINANCIAL STATEMENTS FOR INFORMATION CONCERNING
TRANSACTIONS WITH AFFILIATES.
(4) SEE NOTE 6 OF NOTES TO THE FINANCIAL STATEMENTS FOR INFORMATION REGARDING
MORTGAGE LOAN AGREEMENTS, COLLATERALIZED BY THE LAND, BUILDINGS AND
IMPROVEMENTS.
15
BROWN-BENCHMARK PROPERTIES LIMITED PARTNERSHIP
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, as amended, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
BROWN-BENCHMARK PROPERTIES
LIMITED PARTNERSHIP
DATE: 3/15/01 BY: /s/ John M. Prugh
John M. Prugh
President and Director
Administrative General Partner
Pursuant to the requirements of the Securities Exchange Act of 1934 as amended,
this report has been signed by the following in the capacities and on the dates
indicated.
DATE: 3/15/01 By: /s/ John M. Prugh
John M. Prugh
President and Director
Brown-Benchmark AGP, Inc.
Administrative General Partner
DATE: 3/28/01 By: /s/ Peter E. Bancroft
Peter E. Bancroft
Vice President and Director
Brown-Benchmark AGP, Inc.
Administrative General Partner
DATE: 3/15/01 By: /s/ Terry F. Hall
Terry F. Hall
Secretary
Brown-Benchmark AGP, Inc.
Administrative General Partner
DATE: 3/15/01 By: /s/ Timothy M. Gisriel
Timothy M. Gisriel
Treasurer
Brown-Benchmark AGP, Inc.
Administrative General Partner
DATE: 3/16/01 By: /s/ Daniel P. Riedel
Daniel P. Riedel
Chairman, President and Director
Benchmark Equities, Inc.
Development General Partner
DATE: 3/16/01 By: /s/ Deborah J. Maxon
Deborah J. Maxson
Treasurer
Benchmark Equities, Inc.
Development General Partner
-15-