FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
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 0-2666
250 WEST 57th ST. ASSOCIATES
(Exact name of registrant as specified in its charter)
A New York Partnership 13-6083380
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
60 East 42nd Street, New York, New York 10165
(Address of principal executive offices)
(Zip Code)
(212) 687-8700
(Registrant's telephone number, including area code)
N/A
(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 [ ] .
An Exhibit Index is located on Page 13 of this Report.
Number of pages (including exhibits) in this filing: 14<PAGE>
2.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
250 West 57th St. Associates
Condensed Statement of Income
(Unaudited)
For the Three Months
Ended March 31,
1997 1996
Income:
Basic rent, from a related
party (Note B) $ 79,289 $ 79,289
Advance of primary overage
rent, from a related
party (Note B) 188,000 188,000
-------- --------
Total income 267,289 267,289
-------- --------
Expenses:
Interest on mortgage 67,117 67,579
Supervisory services, to a
related party (Note C) 15,000 15,000
Amortization of mortgage
refinancing costs 1,957 1,957
-------- --------
Total expenses 84,074 84,536
-------- --------
Net income $183,215 $182,753
======== ========
Earnings per $5,000 partici-
pation unit, based on 720
participation units out-
standing during the year $ 254.47 $ 253.82
======== ========
Distributions per $5,000 participation:
Distributions per $5,000
participation consisted of
the following:
Income $ 250.00 $ 250.00
======== ========
At March 31, 1997 and 1996, there were $3,600,000 of participations
outstanding.<PAGE>
<PAGE>
3.
250 West 57th St. Associates
Condensed Balance Sheet
(Unaudited)
March 31, 1997 December 31, 1996
Assets
Current assets:
Cash $ 84,124 $ 84,124
---------- ----------
Total current assets 84,124 84,124
---------- ----------
Real estate, at cost:
Property situated at 250-264 West
57th Street, New York, New York:
Land 2,117,435 2,117,435
Building 4,940,682 4,940,682
Less: Accumulated depreciation 4,940,682 4,940,682
---------- ----------
-0- -0-
Building improvements 688,000 688,000
Less: Accumulated depreciation 688,000 688,000
---------- ----------
-0- -0-
Tenants' installations and
improvements 249,791 249,791
Less: Accumulated amortization 249,791 249,791
---------- ----------
-0- -0-
Other assets:
Mortgage refinancing costs 41,106 41,106
Less: Accumulated amortization 16,311 14,354
---------- ----------
24,795 26,752
---------- ----------
Total assets $2,226,354 $2,228,311
========== ==========
Liabilities and Capital
Current liabilities:
Accrued interest payable $ 22,359 $ 22,399
First mortgage principal payments
due within one year (Note B) 21,774 21,270
---------- ----------
Total current liabilities 44,133 43,669
Long-term debt (Note B) 2,832,543 2,838,179
Capital (deficit) (See analysis, page 4):
March 31, 1997 (650,322) -0-
December 31, 1996 -0- (653,537)
---------- ----------
Total liabilities and capital:
March 31, 1997 $2,226,354
December 31, 1996 ========== $2,228,311
========== <PAGE>
<PAGE>
4.
250 West 57th St. Associates
Analysis of Capital (Deficit)
(Unaudited)
March 31, 1997 December 31, 1996
Capital:
January 1, 1997 $ (653,537)
January 1, 1996 $ (665,228)
Add, Net income:
January 1, 1997 through
March 31, 1997 183,215 -0-
January 1, 1996 through
December 31, 1996 -0- 2,224,320
---------- ----------
(470,322) 1,559,092
Less, Distributions:
Distribution, November 30, 1996
of Secondary Overage Rent
for the lease year ended
September 30, 1996 -0- 1,492,629
Distributions January 1, 1997
through March 31, 1997 180,000 -0-
Distributions, January 1, 1996
through December 31, 1996 -0- 720,000
---------- ----------
180,000 2,212,629
---------- ----------
Capital (deficit):
March 31, 1997 $ (650,322)
December 31, 1996 ========== $ (653,537)
========== <PAGE>
<PAGE>
5.
250 West 57th St. Associates
Condensed Statements of Cash Flows
(Unaudited)
January 1, 1997 January 1, 1996
through through
March 31, 1997 March 31, 1996
Cash flows from operating activities:
Net income $ 183,215 $ 182,753
Adjustments to reconcile net income
to cash provided by operating
activities:
Amortization of mortgage refinancing
costs 1,957 1,957
Change in accrued interest payable (40) (37)
----------- -----------
Net cash provided by operating
activities 185,132 184,673
----------- -----------
Cash flows from financing activities:
Cash distributions (180,000) (180,000)
Principal payments on long-term debt (5,132) (4,673)
----------- -----------
Net cash used in financing activities (185,132) (184,673)
----------- -----------
Net increase (decrease) in cash -0- -0-
Cash, beginning of period 84,124 84,124
----------- -----------
Cash, end of period 84,124 $ 84,124
=========== ===========
January 1, 1997 January 1, 1996
through through
March 31, 1997 March 31, 1996
Cash paid for:
Interest $ 67,157 $ 67,616
=========== =========== <PAGE>
<PAGE>
250 West 57th St. Associates 6.
March 31, 1997
NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
Note A - Basis of Presentation
The accompanying unaudited condensed financial
statements have been prepared in accordance with the instructions
to Form 10-Q and therefore do not include all information and
footnotes necessary for a fair presentation of financial position,
results of operations and statement of cash flows in conformity
with generally accepted accounting principles. The accompanying
unaudited condensed financial statements include all adjustments
(consisting only of normal recurring accruals) which are, in the
opinion of the joint venturers in Registrant, necessary for a fair
statement of the results for such interim periods. The joint
venturers in Registrant believe that the accompanying unaudited
condensed financial statements and the notes thereto fairly
disclose the financial condition and results of Registrant's
operations for the periods indicated and are adequate to make the
information presented therein not misleading.
Note B - Interim Period Reporting
The results for the interim period are not necessarily
indicative of the results to be expected for a full year.
Registrant is a New York joint venture which was
organized on May 25, 1953. On September 30, 1953, Registrant
acquired fee title to the "Fisk Building" (the "Building") and the
land thereunder located at 250-264 West 57th Street, New York, New
York (collectively, the "Property"). Registrant's joint venturers
are Peter L. Malkin and Stanley Katzman (the "Joint Venturers"),
each of whom also acts as an agent for holders of participations
in their undivided joint venture interests in Registrant (the
"Participants").
Registrant leases the Property to Fisk Building
Associates (the "Net Lessee"), under a long-term net operating
lease (the "Net Lease"), the current term of which expires on
September 30, 2003. Net Lessee is a New York partnership in which
Mr. Malkin is among its partners. In addition, the Joint
Venturers are also members of the law firm of Wien & Malkin LLP,
60 East 42nd Street, New York, New York, counsel to Registrant and
Net Lessee ("Counsel"). See Note C of this Item 1 ("Note C").
Under the Net Lease, Net Lessee must pay (i) annual
basic rent equal to the sum of $28,000 plus an amount equal to the
rate of constant payments for interest and amortization required
annually under the first mortgage described below (the "Basic
Rent"), and (ii)(A) primary overage rent equal to the lesser of<PAGE>
<PAGE>
250 West 57th St. Associates 7.
March 31, 1997
(1) Net Lessee's net operating income for the preceding lease year
or (2) $752,000 (the "Primary Overage Rent"), and (B) secondary
overage rent equal to 50% of any remaining balance of Net Lessee's
net operating income for such lease year ("Secondary Overage
Rent").
Net Lessee is required to make a monthly payment to
Registrant, as an advance against Primary Overage Rent, of an
amount equal to its operating profit for its previous lease year
in the maximum amount of $752,000 per annum. Net Lessee currently
advances $752,000 each year, which permits Registrant to make
regular monthly distributions at 20% per annum on the
Participants' remaining original cash investment.
For the lease year ended September 30, 1996, Net Lessee
reported net operating profit of $4,068,953 after deduction of
Basic Rent. Net Lessee paid Primary Overage Rent of $752,000,
together with Secondary Overage Rent of $1,658,477 for the fiscal
year ended September 30, 1996. The Secondary Overage Rent of
$1,658,477 represents 50% of the excess of the net operating
profit of $4,068,953 over $752,000. After payment of $165,848 to
Counsel as an additional payment for supervisory services, the
balance of $1,492,629 was distributed to the Participants on
November 30, 1996.
Secondary Overage Rent income is recognized when earned
from Net Lessee, at the close of the lease year ending September
30. Such income is not determinable until Net Lessee, pursuant to
the Net Lease, renders to Registrant a certified report on the
operation of the Property. The Net Lease does not provide for the
Net Lessee to render interim reports to Registrant, so no income
is reflected for the period between the end of the lease year and
the end of Registrant's fiscal year.
The Net Lease provides for one renewal option of 25
years. The Participants in Registrant and the partners in Net
Lessee have agreed to execute three additional 25-year renewal
terms on or before the expiration of the then applicable renewal
term.
Effective March 1, 1995, the first mortgage loan on the
Property, in the principal amount of $2,890,758, held by Apple
Bank for Savings ("Apple Bank") was refinanced (the
"Refinancing"). The material terms of the refinanced mortgage
loan (the "Mortgage Loan") are as follows:
(i) a maturity date of June 1, 2000;
(ii) monthly payments of $24,096 aggregating
$289,157 per annum applied first to interest at the rate
of 9.4% per annum and the balance in reduction of
principal; <PAGE>
<PAGE>
250 West 57th St. Associates 8.
March 31, 1997
(iii) no prepayment until after the third loan year.
Thereafter, a 3% penalty will be imposed in the fourth
loan year and a 2% penalty during the fifth loan year.
No prepayment penalty will be imposed if the Mortgage
Loan is paid in full during the last 90 days prior to
maturity of the Mortgage Loan; and
(iv) no Partner or Participant will have any
personal liability for principal of, or interest on, the
Mortgage Loan.
Note C - Supervisory Services
Registrant pays Counsel for legal fees and supervisory
services and disbursements: (i) $40,000 per annum (the "Basic
Payment"); and (ii) an additional payment of 10% of all
distributions to Participants in any year in excess of the amount
representing a return to them at the rate of 15% per annum on
their remaining original cash investment (the "Additional
Payment"). At March 31, 1997, the Participants' remaining
original cash investment was $3,600,000. Of the Basic Payment,
$28,000 is payable from Basic Rent and $12,000 is payable from
Primary Overage Rent received by Registrant.
No remuneration was paid during the three month period
ended March 31, 1997 by Registrant to any of the Joint Venturers
as such. Pursuant to the fee arrangements described herein,
Registrant also paid Counsel $10,000 of the Basic Payment and
$5,000 on account of the Additional Payment for the three month
period ended March 31, 1997.
The supervisory services provided to Registrant by
Counsel include legal, administrative services and financial
services. The legal and administrative services include acting as
general counsel to Registrant, maintaining all of its partnership
records, performing physical inspections of the Building,
reviewing insurance coverage and conducting annual partnership
meetings. Financial services include monthly receipt of rent from
Net Lessee, payment of monthly and additional distributions to the
Participants, payment of all other disbursements, confirmation of
the payment of real estate taxes, and active review of financial
statements submitted to Registrant by Net Lessee and financial
statements audited by and tax information prepared by Registrants'
independent certified public accountant, and distribution of such
materials to the Participants. Counsel also prepares quarterly,
annual and other periodic filings with the Securities and Exchange
Commission and applicable state authorities.
Reference is made to Note B for a description of the
terms of the Net Lease between Registrant and Net Lessee. The
respective interests, if any, of each Joint Venturer in Registrant<PAGE>
<PAGE>
250 West 57th St. Associates 9.
March 31, 1997
and in Net Lessee arise solely from such person's ownership of
participations in Registrant and partnership interests or
participations in Net Lessee. The Joint Venturers receive no
extra or special benefit not shared on a pro rata basis with all
other Participants in Registrant or partners in Net Lessee.
However, each of the two Joint Venturers who is currently a member
of Counsel, by reason of his respective partnership interest in
Counsel, is entitled to receive his pro rata share of any legal
fees or other remuneration paid to Counsel for legal services
rendered to Registrant and Net Lessee.
As of March 31, 1997, the Joint Venturers owned of
record and beneficially $29,166 of Participations, representing
less than 1% of the currently outstanding Participations in
Registrant.
In addition, as of March 31, 1997, certain of the Joint
Venturers in Registrant (or their respective spouses) held
additional Participations as follows:
Isabel Malkin, the wife of Peter L. Malkin, owned of
record and beneficially $70,000 of Participations.
Mr. Malkin disclaims any beneficial ownership of such
Participations.
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.
Registrant was organized solely for the purpose of
owning the Property subject to a net operating lease of the
Property held by Net Lessee. Registrant is required to pay, from
Basic Rent, the charges on the Mortgage Loan and amounts for
supervisory services, and to then distribute the balance of such
Basic Rent to holders of Participations. See Note C of Item 1.
Pursuant to the Net Lease, Net Lessee has assumed sole respon-
sibility for the condition, operation, repair, maintenance and
management of the Property. Accordingly, Registrant need not
maintain substantial reserves or otherwise maintain liquid assets
to defray any operating expenses of the Property.
Registrant's results of operations are affected
primarily by the amount of rent payable to it under the Net Lease.
The amounts of Primary Overage Rent and Secondary Overage Rent is
affected by the New York City economy and its real estate market.
It is difficult to forecast whether the New York City economy and
real estate market will improve or deteriorate over the next few
years.
Registrant does not pay dividends. During the three
month period ended March 31, 1997, Registrant made regular monthly
distributions of $83.33 for each $5,000 participation ($1,000 per
annum for each $5,000 participation). On November 30, 1996,
Registrant made an additional distribution of $2,073 for each<PAGE>
<PAGE>
250 West 57th St. Associates 10.
March 31, 1997
$5,000 participation. Such distribution represented the balance
of Secondary Overage Rent paid by Net Lessee in accordance with
the terms of the Net Lease after deducting the Additional Payment
to Counsel. See Notes B and C. There are no restrictions on
Registrant's present or future ability to make distributions;
however, the amount of such distributions depends solely on the
ability of Net Lessee to make monthly payments of Basic Rent,
Primary Overage Rent and Secondary Overage Rent to Registrant in
accordance with the terms of the Net Lease. Registrant expects to
make distributions so long as it receives the payments provided
for under the Net Lease. See Note B.
The following summarizes with respect to the current
period and corresponding period of the previous year, the material
factors affecting Registrant's results of operations for such
periods:
Total income remained the same for the three-month
period ended March 31, 1997 as compared with the
three-month period ended March 31, 1996. Total
expenses decreased for the three month period ended
March 31, 1997 as compared to the three month period
ended March 31, 1996. Such decrease resulted from a
decrease in interest expense on the Mortgage Loan.
Liquidity and Capital Resources
There has been no significant change in Registrant's
liquidity for the three month period ended March 31, 1997, as
compared with the three month period ended March 31, 1996.
The amortization payments due under the Mortgage Loan
(see Note B of Item 1 hereof) will not be sufficient to fully
liquidate the outstanding principal balance thereof at maturity in
2000. Registrant does not maintain any reserve to cover the
payment of any mortgage indebtedness at or prior to maturity.
Therefore, repayment of such indebtedness will depend on
Registrant's ability to arrange a further refinancing of the
Mortgage Loan. The ability of Registrant to obtain any such
refinancing will depend upon several factors, including the value
of the Property at that time and future trends in the real estate
market and the economy in the geographic area in which the
Property is located.
Registrant anticipates that funds for working capital
for the Property will be provided by rental payments received from
the Net Lessee and, to the extent necessary, from additional
capital investment by the partners in the Net Lessee and/or
external financing. However, as noted above, Registrant has no
requirement to maintain substantial reserves to defray any
operating expenses of the Property. Registrant foresees no need
to make material commit-ments for capital expenditures while the
Net Lease is in effect.<PAGE>
<PAGE>
250 West 57th St. Associates 11.
March 31, 1997
Inflation
Registrant believes that there has been no material
change in the impact of inflation on its operations since the
filing of its report on Form 10-K for the year ended December 31,
1996, which report and all exhibits thereto are incorporated
herein by reference and made a part hereof.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
There are no material pending legal proceedings to which
Registrant is a party.
Item 6. Exhibits and Reports on Form 8-K.
(a) The exhibits hereto are being incorporated by reference.
(b) Registrant has not filed any report on Form 8-K during
the quarter for which this report is being filed.<PAGE>
<PAGE>
250 West 57th St. Associates
March 31, 1997 12.
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.
The individual signing this report on behalf of
Registrant is Attorney-in-Fact for Registrant and each of the
Joint Venturers in Registrant, pursuant to a Power of Attorney,
dated March 29, 1996 (the "Power").
250 WEST 57TH ST. ASSOCIATES
(Registrant)
By /s/ Stanley Katzman
Stanley Katzman, Attorney-in-Fact*
Date: May 13, 1997
Pursuant to the requirements of the Securities Exchange
Act of 1934, this report has been signed by the undersigned as
Attorney-in-Fact for each of the Joint Venturers in Registrant,
pursuant to the Power, on behalf of Registrant and as a Joint
Venturer in Registrant on the date indicated.
By /s/ Stanley Katzman
Stanley Katzman, Attorney-in-Fact*
Date: May 13, 1997
______________________
* Mr. Katzman supervises accounting functions for
Registrant.<PAGE>
<PAGE>
250 West 57th St. Associates
March 31, 1997 13.
EXHIBIT INDEX
Number Document Page*
3 Amended Business Certificate of
Registrant filed with the Clerk of
New York County on May 9, 1997
reflecting a change in the Partners
of Registrant.
25 Power of Attorney dated March 29,
1996, which was filed as Exhibit 24 to
year ended December 31, 1996 and is
incorporated by reference as an
exhibit hereto.
______________________
* Page references are based on sequential numbering system.
EXHIBIT 3
AMENDED BUSINESS CERTIFICATE
The undersigned hereby certify that a certificate of business
under the assumed name
250 WEST 57TH ST. ASSOCIATES
for the conduct of business at 60 East 42nd Street, New York, New
York, was filed in the office of the County Clerk New York County,
State of New York, on the 11th day of June, 1953, under index
number 6981/53; that the last amended certificate was filed on the
22nd day of December, 1995 in the office of said County Clerk
under index number 6981/53.
It is hereby further certified that this amended certificate
is made for the purposes of more accurately setting forth the
facts recited in the original certificate or the last amended
certificate and to set forth the following changes in such facts;*
RALPH W. FELSTEN, residing at 300 East 54th Street, New York, New
York 10022, has withdrawn as a member of 250 West 57th St.
Associates.
The members of 250 West 57th St. Associates now consist of:
Peter L. Malkin and Stanley Katzman.
IN WITNESS WHEREOF, the undersigned have as of the 1st day of
January, 1997 made and signed this certificate.
/s/Ralph W. Felsten /s/Stanley Katzman
RALPH W. FELSTEN STANLEY KATZMAN
State of New York )
: ss.:
County of New York )
On this 7th day of May, 1997, before me personally appeared
STANLEY KATZMAN and RALPH W. FELSTEN, to me known and known to me
to be the individuals described in and who executed the foregoing
certificate, and they thereupon duly acknowledged to me that they
executed the same.
/s/Notary Public
NOTARY PUBLIC
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Company's Balance Sheet as of March 31, 1997 and the Statement Of Income
for the period ended March 31, 1997, and is qualified in its entirety by
reference to such financial statements.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 84,124
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 84,124
<PP&E> 7,995,908
<DEPRECIATION> 5,878,473
<TOTAL-ASSETS> 2,226,354<F1>
<CURRENT-LIABILITIES> 44,133<F2>
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> (650,322)
<TOTAL-LIABILITY-AND-EQUITY> 2,226,354<F3>
<SALES> 267,289<F4>
<TOTAL-REVENUES> 267,289
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 16,957<F5>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 67,117
<INCOME-PRETAX> 183,215
<INCOME-TAX> 0
<INCOME-CONTINUING> 183,215
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 183,215
<EPS-PRIMARY> 254.47<F6>
<EPS-DILUTED> 254.47<F6>
<FN>
<F1>Includes unamortized mortgage refinancing costs
<F2>Accrued interest on mortgage, and first mortgage principal payments
due within one year
<F3>Includes long-term debt
<F4>Rental income includes basic rent and advance of primary overage rent
<F5>Supervisory services and amortization of mortgage refinance costs
<F6>Earnings per $5,000 participation unit, based on 720 participation units
outstanding during the period
</FN>
</TABLE>
