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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(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, 2000
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 0-10272
Winthrop Residential Associates I, A Limited Partnership
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(Exact name of small business issuer as specified in its charter)
Maryland 04-2720493
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Five Cambridge Center, Cambridge, MA 02142-1493
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(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (617) 234-3000
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Indicate by check mark whether 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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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30,2000
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PART 1 - FINANCIAL INFORMATION
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ITEM 1. FINANCIAL STATEMENTS.
BALANCE SHEETS (UNAUDITED)
(IN THOUSANDS, EXCEPT UNIT DATA)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
2000 1999
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<S> <C> <C>
Assets
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Cash and cash equivalents $ 433 $ 446
Note receivable and accrued interest 122 116
Investment in Local Limited Partnership 270 235
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Total Assets $ 825 $ 797
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Liabilities and Partners' Capital
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Liabilities:
Accrued expenses $ 9 $ 18
Loan payable and accrued interest - affiliate 376 354
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Total Liabilities 385 372
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Partners' Capital:
Limited Partners -
Units of Limited Partnership Interest,
$1,000 stated value per unit; 25,676
units authorized; 25,595 units issued
and outstanding 1,536 1,522
General Partners deficit (1,096) (1,097)
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Total Partners' Capital 440 425
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Total Liabilities and Partners' Capital $ 825 $ 797
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</TABLE>
See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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STATEMENTS OF INCOME (UNAUDITED)
(IN THOUSANDS, EXCEPT UNIT DATA)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED FOR THE NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Income:
Income from Local Limited Partnership
cash distributions $ - $ - $ 68 $ 73
Equity in income (loss) of Local Limited
Partnership 11 - 35 (34)
Interest 5 6 17 18
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Total income 16 6 120 57
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Expenses:
Interest 7 7 22 19
General and administrative 20 28 76 78
Management fees 7 - 7 -
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Total expenses 34 35 105 97
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Net (loss) income $ (18) $ (29) $ 15 $ (40)
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Net (loss) income allocated to General Partners $ (1) $ (1) $ 1 $ (2)
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Net (loss) income allocated to Limited Partners $ (17) $ (28) $ 14 $ (38)
============= ============== ============= ===============
Net (loss) income per Unit of Limited
Partnership Interest $ (0.66) $ (1.09) $ 0.55 $ (1.48)
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</TABLE>
See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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STATEMENTS OF PARTNERS' CAPITAL (UNAUDITED)
(IN THOUSANDS, EXCEPT UNIT DATA)
<TABLE>
<CAPTION>
UNITS OF
LIMITED GENERAL LIMITED TOTAL
PARTNERSHIP PARTNERS' PARTNERS' PARTNERS'
INTEREST DEFICIT CAPITAL CAPITAL
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<S> <C> <C> <C> <C>
Balance - January 1, 2000 25,595 $ (1,097) $ 1,522 $ 425
Net Income 1 14 15
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Balance - September 30, 2000 25,595 $ (1,096) $ 1,536 $ 440
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</TABLE>
See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
2000 1999
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<S> <C> <C>
Cash Flows From Operating Activities:
Net income (loss) $ 15 $ (40)
Adjustments to reconcile net income (loss) to net cash used in
operating activities:
Equity in (income) loss of Local Limited Partnership (35) 34
Income from Local Partnership Cash Distributions (68) (73)
Changes in assets and liabilities:
Increase in accrued interest receivable (6) (7)
(Decrease) increase in accrued expenses (9) 2
Increase in accrued interest payable 22 19
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Net cash used in operating activities (81) (65)
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Cash Flows From Investing Activities:
Distributions received from Local Limited Partnership 68 73
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Cash provided by investing activities 68 73
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Net (decrease) increase in cash and cash equivalents (13) 8
Cash and cash equivalents, beginning of period 446 455
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Cash and cash equivalents, end of period $ 433 $ 463
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</TABLE>
See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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NOTES TO FINANCIAL STATEMENTS
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1. GENERAL
The accompanying financial statements, footnotes and discussions should be
read in conjunction with the financial statements, related footnotes and
discussions contained in the Partnership's Annual Report on Form 10-KSB for
the year ended December 31, 1999.
The financial information contained herein is unaudited. In the opinion of
management, all adjustments necessary for a fair presentation of such
financial information have been included. All adjustments are of a normal
recurring nature. Certain amounts have been reclassified to conform to the
September 30, 2000 presentation. The balance sheet at December 31, 1999 was
derived from audited financial statements at such date.
The results of operations for the three and nine months ended September 30,
2000 and 1999 are not necessarily indicative of the results to be expected
for the full year.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
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The matters discussed in this Form 10-QSB contain certain
forward-looking statements and involve risks and uncertainties
(including changing market conditions, competitive and regulatory
matters, etc.) detailed in the disclosure contained in this Form 10-QSB
and the other filings with the Securities and Exchange Commission made
by the Partnership from time to time. The discussion of the
Partnership's liquidity, capital resources and results of operations,
including forward-looking statements pertaining to such matters, does
not take into account the effects of any changes to the Partnership's
operations. Accordingly, actual results could differ materially from
those projected in the forward-looking statements as a result of a
number of factors, including those identified herein.
This item should be read in conjunction with the financial statements
and other items contained elsewhere in the report.
Liquidity and Capital Resources
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As of September 30, 2000, the Partnership retained an equity interest in
five Local Limited Partnerships each of which owns one apartment
complex. The properties are located throughout the United States.
The level of liquidity based on cash and cash equivalents experienced a
$13,000 decrease for the nine months ended September 30, 2000, as
compared to December 31, 1999. The Partnership's $68,000 of cash
received from a Local Limited Partnership (investing activities) was
more than offset by $81,000 of net cash used in operating activities. At
September 30, 2000, the Partnership had $433,000 in cash and cash
equivalents, which has been invested primarily in short-term
certificates of deposit and money market accounts.
The Partnership's primary source of income is distributions from the
Local Limited Partnerships. The Partnership requires cash to pay general
and administrative expenses and to make capital contributions to any of
the Local Limited Partnerships which the Managing General Partner deems
to be in the Partnership's best interest to preserve its ownership
interest. To date, all cash requirements have been satisfied by interest
income, cash distributed by the Local Limited Partnerships to the
Partnership or by loans.
The loan payable to an affiliate of the Managing General Partner which
bears interest at prime plus 1% is repayable from cash flows generated
by the Local Limited Partnerships and the proceeds of any sales of real
estate owned by the Local Limited Partnerships. The outstanding
principal balance and accrued interest on the loan was approximately
$376,000 at September 30, 2000. The Partnership did not make cash
distributions to its partners during 2000 or 1999.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION (CONTINUED)
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Liquidity and Capital Resources (Continued)
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The Partnership does not intend to make advances to fund future
operating deficits incurred by any Local Limited Partnership, but
retains its prerogative to exercise business judgment to reverse this
position if circumstances change. Moreover, the Partnership is not
obligated to provide any additional funds to the Local Limited
Partnerships to fund operating deficits. If a Local Limited Partnership
sustains continuing operating deficits and has no other sources of
funding it is likely that it will eventually default on its mortgage
obligations and risk a foreclosure on its property by the lender. If a
foreclosure were to occur, the Local Limited Partnership would lose its
investment in the property and would incur a tax liability due to the
recapture of tax benefits taken in prior years. The Partnership, as an
owner of the Local Limited Partnership, would share these consequences
in proportion to its ownership interest in the Local Limited
Partnership.
The Cedar Lake Ltd. Local Limited Partnership ("Cedar Lake"), which owns
Albany Landings Apartments, has incurred significant operating losses
and cash flow deficits. Cedar Lake has defaulted on the mortgage and HUD
has taken possession of the property. It is anticipated that HUD will
foreclose on the property. The Partnership's investment in this Local
Limited Partnership had previously been written down to zero. For tax
reporting purposes, the Partnership will incur a tax liability due to
the recapture of tax benefits taken in prior years in proportion to its
ownership interest in the Local Limited Partnership.
Results of Operations
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Net income for the nine months ended September 30, 2000 was $15,000 as
compared to a net loss of $40,000 for the nine months ended September
30, 1999. This was due to an increase in income of $63,000 which was
partially offset by an increase in expenses of $8,000.
Income for the nine months ended September 30, 2000, as compared to the
comparable period in 1999, increased primarily due to equity in income
of a Local Limited Partnership of $35,000 during the nine months ended
September 30, 2000 as compared to equity in loss of a Local Limited
Partnership of $34,000 in 1999. Expenses increased primarily due to an
increase in management fees.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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PART II - OTHER INFORMATION
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
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(a) Exhibit 27
27. Financial Data Schedule
99. Supplementary Information Required Pursuant to Section 9.4
of the Partnership Agreement.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the period ended
September 30, 2000.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
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FORM 10-QSB SEPTEMBER 30, 2000
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SIGNATURES
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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
BY: ONE WINTHROP PROPERTIES, INC.
Managing General Partner
BY: /s/ Michael L. Ashner
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Michael L. Ashner
Chief Executive Officer
BY: /s/ Thomas C. Staples
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Thomas C. Staples
Chief Financial Officer
Dated: November 10, 2000
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