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Extraordinary and Unusual Items
6 Months Ended
Jun. 30, 2011
Extraordinary and Unusual Items  
Unusual or Infrequent Items Disclosure [Text Block]

Note C – Casualty Events

 

In February 2009, Arbours of Hermitage Apartments suffered wind damage to the roof of one of its buildings.  The estimated cost to repair the damaged units was approximately $9,000. During 2009, the Partnership incurred approximately $13,000 in clean up costs, which were included in operating expense and received insurance proceeds of approximately $9,000. The Partnership recognized a casualty gain of approximately $9,000 during 2009 as the damaged assets were fully depreciated at the time of the casualty. During the three and six months ended June 30, 2010, the Partnership recognized an additional casualty gain of approximately $4,000 due to the receipt of additional insurance proceeds.

 

In September 2009, Arbours of Hermitage Apartments suffered water damage to its property as a result of severe rain storms and flooding.  The cost to repair the damage was approximately $18,000. During the three and six months ended June 30, 2010, the Partnership received insurance proceeds of approximately $15,000 related to this casualty and recognized a casualty gain of approximately $15,000 as the damaged assets were fully depreciated at the time of the casualty.

 

In November 2009, Arbours of Hermitage Apartments suffered fire damage to several of its buildings. The cost to repair the damaged buildings was approximately $1,350,000, including approximately $41,000 of clean up costs and $104,000 for lost rents. The $104,000 for lost rents is included in receivables and deposits at June 30, 2011 and December 31, 2010. During the six months ended June 30, 2010, the Partnership incurred approximately $36,000 of clean up costs which are included in operating expense and are offset by insurance proceeds of approximately $36,000. Insurance proceeds of approximately $812,000 were received during the six months ended June 30, 2010, which included approximately $36,000 for clean-up costs. Insurance proceeds received of approximately $181,000 were held in escrow with the mortgage lender as of December 31, 2010 and released to the property during the six months ended June 30, 2011. The Partnership recognized a casualty gain of approximately $776,000 during the six months ended June 30, 2010 as the damaged assets were fully depreciated at the time of the casualty. The Partnership anticipates receiving additional proceeds related to this casualty during 2011.

 

In January 2010, Arbours of Hermitage Apartments suffered water damage to its property as a result of severe rain storms. The cost to repair the damage was approximately $18,000. During the three and six months ended June 30, 2010, the Partnership received insurance proceeds of approximately $3,000 related to this casualty and recognized a casualty gain of approximately $3,000 as the damaged assets were fully depreciated at the time of the casualty. During the third quarter of 2010, the Partnership received additional insurance proceeds of approximately $4,000 related to this casualty and recognized an additional casualty gain of approximately $4,000 as the damaged assets were fully depreciated at the time of the casualty.

 

During May 2010, all of the Partnership’s investment properties incurred damages from a severe rain storm. The damages at 865 Bellevue Apartments consisted of water leaks in several of the apartment units. The cost to repair the units and improve drainage was approximately $2,000 which was included in operating expenses during the third quarter of 2010. No insurance proceeds are expected to be received related to this casualty. The damages at Arbours of Hermitage Apartments consisted of water leaks and downed trees. The cost to repair the units and clean up the landscaping damage was approximately $20,000. During the third and fourth quarters of 2010, the Partnership received insurance proceeds of approximately $19,000 related to this casualty and recognized a casualty gain of approximately $19,000 as the damaged assets were fully depreciated at the time of the casualty. No additional insurance proceeds are expected to be received related to this casualty. The damages at Post Ridge Apartments consisted of water leaks to several of the apartment units, downed trees and land erosion. The cost to repair the units and clean up the landscaping damage was approximately $45,000. During the third and fourth quarters of 2010, the Partnership received insurance proceeds of approximately $45,000, of which approximately $43,000 was for costs associated with the repair of the damaged units and clean up of the landscaping damage and was included as an offset to operating expenses. The Partnership recognized a casualty gain of approximately $2,000 during the third quarter of 2010 as the damaged assets were fully depreciated at the time of the casualty. Additional costs of approximately $309,000 are expected to be incurred related to addressing the land erosion.  The Partnership will not receive any insurance proceeds for these additional costs. As of June 30, 2011 and December 31, 2010, the Partnership had incurred approximately $6,000 and $147,000, respectively, in capital expenditures and approximately $1,000 and $43,000, respectively, in operating expenses related to the land erosion.  The Partnership expects to incur the remaining $112,000 associated with remedying the land erosion during 2011.

 

In April 2011, 865 Bellevue Apartments suffered fire damage to one of its apartment buildings as a result of lightning strikes. The damages to the building include complete destruction of four of the units and significant smoke and water damage to the remaining four units in the building. All eight units will require complete replacement. The estimated cost to repair the damaged units is approximately $900,000, including approximately $170,000 of clean up costs and $50,000 for lost rents. The Partnership anticipates receiving insurance proceeds related to this casualty. During the three and six months ended June 30, 2011, the Partnership incurred costs of approximately $18,000 related to this casualty, of which approximately $6,000 was for capital expenditures and approximately $12,000 was for clean up costs which are included in operating expense. During the three and six months ended June 30, 2011, the Partnership recognized a casualty gain of $400,000 due to the receipt of $400,000 of insurance proceeds, all of which were held in escrow with the mortgage lender at June 30, 2011. The $400,000 of insurance proceeds are included in restricted escrows on the consolidated balance sheet at June 30, 2011. The Partnership anticipates receiving additional proceeds related to this casualty during 2011.