SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended September 30, 1995 Commission File Number 0-10272
WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Maryland 04-2720493
(State or other jurisdiction (I.R.S. Employer Identification No.)
incorporation or organization)
One International Place, Boston, MA 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 330-8600
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 1 - FINANCIAL INFORMATION
STATEMENTS OF OPERATIONS
<TABLE>
Three Months Ended Nine Months Ended
September 30, September 30,
(Unaudited) (Note 1) 1995 1994 1995 1994
<S> <C> <C> <C> <C>
Income from Local Limited Partnership cash
distribution..................................................... $ 119,622 $ - $119,622 $ -
Interest income..................................................... - - - -
---------- ---------- ---------- -------
119,622 - 119,622 -
Expenses:
Amortization..................................................... 1,704 1,704 5,112 5,112
Interest (Note 4)................................................ 16,401 13,202 48,198 35,461
General and administrative....................................... 6,355 3,298 40,683 31,039
---------- ------- ------- ------
24,460 18,204 93,993 71,612
---------- ------- ------- ------
Income (Loss) from operations....................................... 95,162 (18,204) 25,629 (71,612)
Equity in net income of Local Limited
Partnerships (Note 3).............................................. 1,264 14,711 10,056 33,237
---------- -------- ---------- --------
Net income (loss)................................................... $ 96,426 $ (3,493) $ 35,685 $ (38,375)
---------- ---------- ------------ ---------
Net income (loss) allocated to General
Partners........................................................... $ 4,821 $ (175) $ 1,784 $ (1,919)
---------- ---------- ---------- ---------
Net income (loss) allocated to Limited
Partners........................................................... $ 91,605 $ (3,318) $ 33,901 $ (36,456)
---------- ---------- ---------- ---------
Net income (loss) per Unit of Limited
Partnership Interest............................................... $ 3.58 $ (.13) $ 1.32 $ (1.42)
---------- ---------- --------- ----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
BALANCE SHEETS
<TABLE>
September 30, December 31,
1995 1994
(Unaudited) (Audited)
ASSETS
<S> <C> <C>
Cash and cash equivalents............................................................ $ 95,617 $ -
Investments in Local Limited Partnerships (Note 3)................................... 1,620,062 1,615,118
------------ -----------
$ 1,715,679 $ 1,615,118
------------ --------------
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses............................................. 430,417 398,543
Loans payable to affiliate (Note 4)............................................... 666,273 633,271
------------ -----------
$ 1,096,690 $ 1,031,814
------------ -----------
Partners' Capital:
Limited Partners
Units of Limited Partnership Interest, $1,000 stated value per Unit;
25,676 units authorized, and 25,609
units issued and outstanding ............................................. 1,688,336 1,654,435
General Partners..................................................................... (1,069,347) (1,071,131)
------------ -----------
618,989 583,304
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
STATEMENTS OF CASH FLOWS
<TABLE>
For The Nine Months Ended
September 30, 1995 and 1994 (Unaudited) (Note 1) 1995 1994
Cash flows from operating activities:
<S> <C> <C>
Net income (loss)................................................................. $ 35,685 $ (38,375)
Adjustments to reconcile net income (loss) to cash
provided by operating activities:
Amortization...................................................................... 5,112 5,112
Equity in net income of Local Limited
Partnerships.................................................................... (10,056) (33,237)
Income from Local Limited Partnership cash
distribution..................................................................... (119,622) -
Changes in assets and liabilities:
Increase in accounts payable and accrued
expenses....................................................................... 31,874 35,462
---------- ----------
Net cash used in operating activities............................................... (57,007) (31,038)
---------- ----------
Cash flow from investing activities:
Cash distributions from Local Limited Partnerships................................ 119,622 -
---------- ---
Cash flows from financing activities:
Proceeds from loan payable.......................................................... 33,002 31,038
---------- -------
Net increase in cash and cash equivalents........................................ 95,617 -
Cash and cash equivalents, beginning of period......................................... - -
---------- -----
Cash and cash equivalents, end of period............................................... $ 95,617 $ -
---------- ----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
<TABLE>
UNITS OF
For the Nine Months Ended LIMITED GENERAL LIMITED
September 30, 1995 and 1994 PARTNERSHIP PARTNERS' PARTNERS' TOTAL
(Unaudited (Note 1) INTEREST CAPITAL CAPITAL CAPITAL
- ------------------- --------- ---------- --------- ----------
<S> <C> <C> <C> <C>
Balance December 31, 1994............................ 25,646 $(1,071,131) $1,654,435 $ 583,304
Retirement of units.................................. (37) - - -
Net Income.......................................... - 1,784 33,901 35,685
------ -------------- ------------ ----------
Balance September 30, 1995........................... 25,609 $(1,069,347) $1,688,336 $ 618,989
---------- ------------ ----------- ----------
Balance December 31, 1993............................ 25,646 $(1,067,731) $1,719,040 $ 651,309
Net loss............................................. - (1,919) (36,456) (38,375)
---- -------------- ------------ ----------
Balance September 30, 1994........................... 25,646 $(1,069,650) $1,682,584 $ 612,934
---------- ------------ ----------- ----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
September 30, 1995
(Unaudited)
1. ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed financial statements included herein have been prepared by
the Registrant, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. The Registrant's accounting and
financial reporting policies are in conformity with generally accepted
accounting principles and include adjustments in interim periods
considered necessary for a fair presentation of the results of operations.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such
rules and regulations. It is suggested that these condensed financial
statements be read in conjunction with the financial statements and the
notes thereto included in the Registrant's latest annual report on Form
10-K.
The accompanying financial statements reflect the Partnership's results of
operations for an interim period and are not necessarily indicative of the
results of operations for the year ending December 31, 1995.
2. TAX INCOME/LOSS
The Partnership's tax income/loss for 1995 is expected to differ from that
for financial reporting purposes primarily due to accounting differences
in the recognition of construction period costs and depreciation incurred
by the Local Limited Partnerships and differences in the recognition of
equity in net income/loss of Local Limited Partnerships under the equity
method of accounting described below.
3. INVESTMENT IN LOCAL LIMITED PARTNERSHIPS
The Partnership accounts for its investment in each Local Limited
Partnership on the equity method of accounting. The investment cost
(including amounts paid or accrued) is subsequently adjusted by the
Partnership's share of the Local Limited Partnership's results of
operations and by distributions received or accrued. Costs relating to the
acquisition and selection of the investment in the Local Limited
partnership are capitalized to the investment account and amortized over
the life of the investment or until the investment balance has been
written down to zero. Costs in excess of the Partnership's initial basis
in the net assets of the Local Limited Partnership are amortized over the
estimated useful lives of the underlying assets. Equity in the loss of
Local Limited Partnerships is not recognized to the extent that the
investment balance would become negative.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
September 30, 1995
(Unaudited)
(Continued)
4. LOANS PAYABLE TO AFFILIATE
Beginning in 1986, the Partnership depleted its available reserves and as
a result borrowed amounts from First Winthrop Corporation ("First
Winthrop") to pay operating expenses and fund operating deficits at
properties owned by the Local Limited Partnerships. The borrowings from
First Winthrop bear interest at the prime rate (8.75% at September 30,
1995) plus 1%. The Partnership accrued interest expense of $48,198 and
$35,461 to First Winthrop during the nine months ended September 30, 1995
and 1994, respectively. The Partnership will meet its interest payments
and repay First Winthrop's loans from cash flow generated by the Local
Limited Partnerships or from the proceeds of any sales of real estate
owned by the Local Limited Partnerships.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Net income for the nine months ended September 30, 1995 was $35,685
compared to a net loss of $38,375 for the nine months ended September 30,
1994. This was due primarily to increased income from Local Limited
Partnership cash distributions (Candlewood & Lynnwood Park). Candlewood
was able to make a cash distribution to the Partnership which represented
its remaining cash balances after the sale of the property through
foreclosure in January 1995. Lynnwood, which is now generating positive
cash flow, was able to make a cash distribution to the Partnership as
payment of accrued fees due to the local general partner has been made.
Two properties, The Villas and Windscape, had previously defaulted on
their mortgage obligations. Currently, both properties are operating under
provisional workout arrangements with HUD. The workout arrangements are
both effective February 1, 1995 through January 31, 1996. In May 1995, HUD
informed the local general partner of Windscape that the mortgage will be
included in an auction to be held in the fall of 1995. The local general
partner is currently corresponding with HUD to request the Modification
Agreement be executed prior to the sale of the loan to a new mortgagee.
The Modification Agreement essentially allows the mortgagor to recast any
delinquent and/or unpaid principal and interest at 7.5% if certain
conditions are met.
Shadowbrook's workout agreement with HUD expired in December 1992. The
Partnership was unable to secure an extension of the workout agreement.
The mortgage note was recently sold in an auction by HUD. The Partnership
will attempt to negotiate a workout agreement with the new mortgagee.
Stonewood defaulted on its mortgage in July 1991 but was unable to
negotiate a workout agreement with HUD. Stonewood's mortgage note was sold
to a new mortgagee in May 1995. Efforts are currently being made to
negotiate a workout agreement with the new mortgagee.
The five remaining properties met their financial obligations during the
nine months ended September 30, 1995, but did not generate sufficient
revenue to distribute any cash flow to the Partnership.
The Partnership requires cash to pay general and administrative expenses.
All cash requirements are satisfied by Partnership income and loans from
First Winthrop.
Variations for future interim periods will occur as the operating results
of the Local Limited Partnership's change and as the Partnership sells its
interests in Local Limited Partnerships and the gains or losses are
recognized.
<PAGE>
SUPPLEMENTARY INFORMATION
REQUIRED PURSUANT TO SECTION 9.4 OF THE PARTNERSHIP AGREEMENT
September 30, 1995 (Unaudited).......................
<TABLE>
1. Statement of Cash Available for Distribution
for the three months ended September 30, 1995:
<S> <C>
Net income....................................................................................... $ 96,426
Add: Amortization........................................................................... 1,704
Equity in net income of Local Limited Partnerships.................................. (1,264)
Cash added to reserves.............................................................. (96,866)
--------
Cash Available for Distribution.................................................................. $ -
--------
</TABLE>
2. Fees and other compensation paid or accrued by the Partnership to the
General Partners, or their affiliates, during the three months ended
September 30, 1995:
<TABLE>
Entity Receiving Form of
Compensation Compensation Amount
<S> <C> <C>
First Winthrop Corporation Interest on Loans to Partnership $16,401
</TABLE>
All other information required pursuant to Section 9.4 of the Partnership
Agreement is set forth in the attached Report on Form 10-Q or Partnership
Report.
<PAGE>
SIGNATURE
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.
WINTHROP RESIDENTIAL ASSOCIATES I,
A LIMITED PARTNERSHIP
(Registrant)
BY: ONE WINTHROP PROPERTIES, INC.
Managing General Partner
BY: /s/Anthony R. Page__________
Anthony R. Page
Chief Financial Officer
BY: /s/Richard J. McCready______
Richard J. McCready
Chief Operating Officer
DATED: November 3, 1995
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information
extracted from unaudited financial statements for the
nine month period ending September 30, 1995 and is
qualified in its entirety by reference to such financial
statements
</LEGEND>
<CIK> 0000350903
<NAME> Winthrop Residential Associates I
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<EXCHANGE-RATE> 1.00000
<CASH> 95,617
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 95,617
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,715,679
<CURRENT-LIABILITIES> 430,417
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 618,989
<TOTAL-LIABILITY-AND-EQUITY> 1,715,679
<SALES> 0
<TOTAL-REVENUES> 119,622
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 45,795
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 48,198
<INCOME-PRETAX> 25,629
<INCOME-TAX> 0
<INCOME-CONTINUING> 25,629
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 35,685
<EPS-PRIMARY> 1.32
<EPS-DILUTED> 0.00
</TABLE>
