Midwest Real Estate Shopping Center LP – ‘10-Q’ for 9/30/99

On:  Friday, 11/12/99   ·   For:  9/30/99   ·   Accession #:  1073339-99-155   ·   File #:  1-09331

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Quarterly Report   —   Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Report for Third Quarter 1999                          7     31K 
 2: EX-27       Financial Data Schedule for the Third Quarter 1999     1      5K 

10-Q   —   Report for Third Quarter 1999
Document Table of Contents

10-Q
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 FORM 10-Q

(Mark One)                                                                      
X        Quarterly Report Pursuant to Section 13 or 15(d) of          
----------             the Securities Exchange Act of 1934                      

 For the Quarterly Period Ended September 30, 1999
                                ------------------
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: 1-9331
                        ------

MIDWEST REAL ESTATE SHOPPING CENTER L.P.
----------------------------------------
Exact Name of Registrant as Specified in its Charter

     Delaware                                               13-3384643
     --------                                               ----------
State or Other Jurisdiction of                                 I.R.S. Employer  
Incorporation or Organization                                Identification No. 

3 World Financial Center, 29th Floor,                                           
New York, NY   Attn.: Andre Anderson                               10285        
------------------------------------                               -----        
Address of Principal Executive Offices                           Zip Code       

(212) 526-3183
--------------
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  X     No   
     ---       ---

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MIDWEST REAL ESTATE SHOPPING CENTER L.P.                                        

                                                        [Enlarge/Download Table]

--------------------------------------------------------------------------------------- 
BALANCE SHEETS                                                                          
                                                      At September 30,   At December 31,
                                                                 1999              1998 
                                                           (unaudited)         (audited)
--------------------------------------------------------------------------------------- 
                                                                                        
Assets                                                                                  
Cash and cash equivalents                                  $2,189,345        $2,409,947 
Due from affiliates, net                                       16,000             4,216 
Other assets                                                    5,435                -- 
--------------------------------------------------------------------------------------- 
      Total Assets                                         $2,210,780        $2,414,163 
======================================================================================= 
Liabilities and Partners' Capital                                                       
Liabilities:                                                                            
Accounts payable and accrued expenses                      $  147,718        $  237,954 
Other payable                                               1,149,389                -- 
Deferred credit                                                    --         1,132,223 
                                                           ---------------------------- 
      Total Liabilities                                     1,297,107         1,370,177 
                                                           ---------------------------- 
Partners' Capital:                                                                      
  General Partner                                               9,138            10,441 
  Limited Partners (10,700,000 securities outstanding)        904,535         1,033,545 
                                                           ---------------------------- 
      Total Partners' Capital                                 913,673         1,043,986 
--------------------------------------------------------------------------------------- 
      Total Liabilities and Partners' Capital              $2,210,780        $2,414,163 
======================================================================================= 

                                                        [Enlarge/Download Table]

--------------------------------------------------------------------------------------- 
STATEMENT OF PARTNERS' CAPITAL (UNAUDITED)                                              
For the nine months ended September 30, 1999                                            
                                                    General       Limited               
                                                    Partner      Partners         Total 
--------------------------------------------------------------------------------------- 
                                                                                        
Balance at December 31, 1998                        $10,441    $1,033,545    $1,043,986 
Net loss                                             (1,303)     (129,010)     (130,313)
--------------------------------------------------------------------------------------- 
Balance at September 30, 1999                       $ 9,138    $  904,535    $  913,673 
======================================================================================= 

See accompanying notes to the financial statements.                             

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MIDWEST REAL ESTATE SHOPPING CENTER L.P.                                        

                                                        [Enlarge/Download Table]

------------------------------------------------------------------------------------------------ 
STATEMENTS OF OPERATIONS (UNAUDITED)                                                             
                               Three months ended September 30,   Nine months ended September 30,
                                            1999          1998               1999           1998 
------------------------------------------------------------------------------------------------ 
                                                                                                 
Income                                                                                           
Interest                                $ 10,547    $   47,898          $  33,383    $    88,360 
Other income                              11,784     4,252,352             11,784      4,252,352 
                                        -------------------------------------------------------- 
      Total Income                        22,331     4,300,250             45,167      4,340,712 
------------------------------------------------------------------------------------------------ 
Expenses                                                                                         
General and administrative                14,781        69,775             44,929        186,466 
Professional fees                         21,116        24,835            130,551        489,658 
Refunds due to former tenants                 --     3,994,133                 --      3,994,133 
                                        -------------------------------------------------------- 
      Total Expenses                      35,897     4,088,743            175,480      4,670,257 
------------------------------------------------------------------------------------------------ 
      Net Income (Loss)                 $(13,566)   $  211,507          $(130,313)   $  (329,545)
================================================================================================ 
Net Income (Loss) Allocated:                                                                     
To the General Partner                  $   (136)   $    2,115          $  (1,303)   $    (3,296)
To the Limited Partners                  (13,430)      209,392           (129,010)      (326,249)
------------------------------------------------------------------------------------------------ 
                                        $(13,566)   $  211,507          $(130,313)   $  (329,545)
================================================================================================ 
Per limited partnership unit                                                                     
(10,700,000 securities outstanding)        $ .00        $ 0.02             $ (.01)       $ (0.03)
------------------------------------------------------------------------------------------------ 

                                                        [Enlarge/Download Table]

------------------------------------------------------------------------------------------------ 
STATEMENTS OF CASH FLOWS (UNAUDITED)                                                             
For the nine months ended September 30,                                                          
                                                                             1999           1998 
------------------------------------------------------------------------------------------------ 
                                                                                                 
Cash Flows From Operating Activities:                                                            
Net loss                                                              $  (130,313)   $  (329,545)
Adjustments to reconcile net loss to net cash                                                    
provided by (used for) operating activities:                                                     
Increase (decrease) in cash arising from changes in                                              
  operating assets and liabilities:                                                              
    Due from affiliates, net                                              (11,784)       141,345 
    Prepaid expenses                                                       (5,435)        13,530 
    Accounts payable and accrued expenses                                 (90,236)       188,077 
    Refunds due to former tenants                                              --      3,994,133 
    Deferred credit                                                    (1,132,223)     1,132,223 
    Other payable                                                       1,149,389             -- 
                                                                      -------------------------- 
Net cash provided by (used for) operating activities                     (220,602)     5,139,763 
------------------------------------------------------------------------------------------------ 
Cash Flows From Financing Activities:                                                            
  Cash distributions                                                           --     (3,053,283)
                                                                      -------------------------- 
Net cash used for financing activities                                         --     (3,053,283)
------------------------------------------------------------------------------------------------ 
Net increase (decrease) in cash and cash equivalents                     (220,602)     2,086,480 
Cash and cash equivalents, beginning of period                          2,409,947      4,430,503 
------------------------------------------------------------------------------------------------ 
Cash and cash equivalents, end of period                              $ 2,189,345    $ 6,516,983 
================================================================================================ 

See accompanying notes to the financial statements.                             

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MIDWEST REAL ESTATE SHOPPING CENTER L.P.                                        

NOTES TO THE FINANCIAL STATEMENTS                                               

The unaudited financial statements should be read in conjunction with the       
Partnership's annual 1998 audited financial statements within Form 10-K.        

The unaudited interim financial statements include all adjustments consisting of
only normal recurring accruals which are, in the opinion of management,         
necessary to present a fair statement of financial position as of September 30, 
1999 and the results of operations for the three and nine months ended September
30, 1999 and 1998, cash flows for the nine months ended September 30, 1999 and  
1998 and the statement of partners' capital for the nine months ended September 
30, 1999. Results of operations for the periods are not necessarily indicative  
of the results to be expected for the full year.                                

The following significant events have occurred subsequent to fiscal year 1998,  
which require disclosure in this interim report per Regulation S-X, Rule 10-01, 
Paragraph (a)(5).                                                               

On September 7, 1999, the Bankruptcy Court issued an Order finding that the real
estate tax refund was not property of the Partnership and directed that the     
balance of the real estate tax refund, less the Partnership's legal and         
professional fees incurred in and during the property tax refund litigation, be 
paid over to a third-party disbursing agent for payment to those former tenants 
who were not paid in the initial distribution.                                  

As a result, no portion of the tax refund will be available for distribution to 
the Limited Partners. The General Partner will proceed with the termination of  
the Partnership as quickly as possible, and any funds in the Partnership's      
remaining cash reserves (after payment of, or provision for, the Partnership's  
liabilities and expenses) will be distributed to the Limited Partners upon      
termination of the Partnership which is expected to occur by year-end 1999.     

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MIDWEST REAL ESTATE SHOPPING CENTER L.P.                                        

Part I, Item 2.  Management's Discussion and Analysis of Financial              
Condition and Results of Operations           

Liquidity and Capital Resources                                                 
-------------------------------                                                 

In October 1997, the Partnership entered into a stipulation and agreement of    
settlement (the "Settlement") of the class action litigation originally brought 
against it and other parties in 1994. The General Partner decided to settle the 
actions solely to avoid further expense and the burden of continued litigation, 
and continues to deny the allegations asserted against it in the complaint.     
Pursuant to the Settlement, which resolves all matters among the parties, the   
Partnership contributed $500,000 toward a fund for the payment of all           
plaintiffs' claims. On February 20, 1998, the Bankruptcy Court (the "Court")    
issued and executed an order approving the Settlement which included a full and 
final release of the Unitholder claims against the Partnership, the General     
Partner and the other defendants.                                               

The Partnership pursued a property tax assessment appeal with respect to        
Brookdale Center for a portion of the time that the Partnership owned it. A     
settlement was negotiated with Hennepin County, Minnesota (the "Tax             
Settlement"), and at a hearing on July 16, 1998, the Tax Settlement was approved
by the Court. However, the allocation and distribution of the refunded taxes,   
which total approximately $5.4 million, was challenged by certain former tenants
of Brookdale Center and the Partnership's former mortgage lender, the Equitable 
Life Assurance Society of the United States ("Equitable"). On September 30, 1998
the Court issued an order approving the distribution of tax refunds to the      
former tenants which totaled $3,994,133. The Bankruptcy Court with jurisdiction 
over the Partnership's bankruptcy case heard the argument on Equitable's        
challenge on September 16, 1998. On September 7, 1999, the Bankruptcy Court     
issued an Order finding that the real estate tax refund was not property of the 
Partnership and directed that the balance of the real estate tax refund, less   
the Partnership's legal and professional fees incurred in and during the        
property tax refund litigation, be paid over to a third-party disbursing agent  
for payment to those former tenants who were not paid in the initial            
distribution. At September 30, 1999, $1,149,389 is classified as other payable  
on the Partnership's balance sheet for payment of this amount.                  

On July 28, 1998, after receiving approval from the Court, the Partnership paid 
a cash distribution in the amount of $0.2825 per Limited Partnership Unit. This 
amount represents the Partnership's cash, less reserves for current and         
contingent liabilities, which was paid out following the Settlement.            

Upon distribution of the refunded property taxes, the General Partner intends to
distribute the remaining cash reserves (after payment of, or provision for, the 
Partnership's liabilities and expenses) and proceed with the dissolution of the 
Partnership which is expected to occur by year-end 1999.                        

At September 30, 1999, the Partnership had cash and cash equivalents totaling   
$2,189,345, compared with $2,409,947 at December 31, 1998. The decrease is      
primarily due to payment of Partnership administrative expenses and professional
fees.                                                                           

Accounts payable and accrued expenses totaled $147,718 at September 30, 1999,   
compared with $237,954 at December 31, 1998. The decrease is primarily          
attributable to a decrease in general and administrative expenses, and          
professional fees.                                                              

Other payable at September 30, 1999 represents primarily amounts to be paid to a
third-party disbursing agent for payment of real estate tax refunds to former   
tenants of Brookdale Center.                                                    

Results of Operations                                                           
---------------------                                                           

Net cash used for operating activities totaled $220,602 for the nine months     
ended September 30, 1999, compared to net cash provided by operating activities 
of $5,139,763 for the corresponding period in 1998. The change from cash        
provided to cash used is primarily due to the Brookdale Center property tax     
refunds in 1998.                                                                

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MIDWEST REAL ESTATE SHOPPING CENTER L.P.                                        

The Partnership reported a net loss for the three and nine months ended         
September 30, 1999 of $13,566 and $130,313, compared to a net income for the    
three months ended September 30, 1998 of $211,507, and a net loss for the nine  
months ended September 30, 1998 of $329,545. The change from net income to net  
loss for the three-month period is primarily due to the Brookdale Center        
property tax refunds, net of funds allocated to former tenants in 1998. The     
decrease in net loss for the nine-month period is primarily due to a reduction  
in general and administrative expenses, and professional fees.                  

General and administrative expenses totaled $14,781 and $44,929 for the three   
and nine months ended September 30, 1999, compared with $69,775 and $186,466 for
the corresponding periods in 1998. The decrease reflects lower travel, printing,
postage and administrative expenses.                                            

Part II     Other Information                                                   

Items 1-5   Not applicable.                                                     

Item 6      Exhibits and reports on Form 8-K.                                   

(a) Exhibits -                                          

(27)Financial Data Schedule                     

(b) Reports on Form 8-K -                               

               On October 15, 1999, the Partnership filed a Form 8-K reporting
               that the Bankruptcy Court issued an Order finding that the real
      estate tax refund was not property of the Partnership.

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MIDWEST REAL ESTATE SHOPPING CENTER L.P.                                        

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.                                         

                      MIDWEST REAL ESTATE SHOPPING CENTER L.P.

       BY:  MIDWEST CENTERS INC.
       General Partner

Date:  November 12, 1999            BY:    /s/Michael T. Marron                 
                                           -------------------------------------
                Name:  Michael T. Marron
                                    Title: President and Chief Financial Officer

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘10-Q’ Filing		Date		First		Last			Other Filings
Filed on:		11/12/99		7
		10/15/99		6					8-K
For Period End:		9/30/99		1		6
		9/7/99		4		5			8-K
		12/31/98		2		5			10-K
		9/30/98		4		6			10-Q
		9/16/98		5
		7/28/98		5
		7/16/98		5
		2/20/98		5
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