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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 March 31, 2000
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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)
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<S> <C>
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
FORM 10-QSB MARCH 31, 2000
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements.
Balance Sheets (Unaudited)
(In Thousands, Except Unit Data)
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<CAPTION>
March 31, December 31,
2000 1999
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Assets
<S> <C> <C>
Cash and cash equivalents $ 422 $ 446
Note receivable and accrued interest 118 116
Investment in Local Limited Partnership 247 235
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Total Assets $ 787 $ 797
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Liabilities and Partners' Capital
Liabilities:
Accrued expenses $ 12 $ 18
Loan payable and accrued interest - affiliate 361 354
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Total Liabilities 373 372
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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 1,512 1,522
General Partners deficit (1,098) (1,097)
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Total Partners' Capital 414 425
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Total Liabilities and Partners' Capital $ 787 $ 797
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See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 2000
Statements of Income (Unaudited)
(In Thousands, Except Unit Data)
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<CAPTION>
For The Three Months Ended
March 31, March 31,
2000 1999
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<S> <C> <C>
Income/(Loss):
Equity in income (loss) of Local Limited
Partnership $ 12 $ (9)
Interest 6 5
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Total Income (Loss) 18 (4)
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Expenses:
Interest 7 6
General and administrative 22 26
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Total expenses 29 32
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Net loss $ (11) $ (36)
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Net loss allocated to General Partners $ (1) $ (2)
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Net loss allocated to Limited Partners $ (10) $ (34)
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Net loss per Unit of Limited Partnership Interest $ (0.39) $ (1.33)
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See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 2000
Statements of Partners' Capital (Unaudited)
(In Thousands, Except Unit Data)
<TABLE>
<CAPTION>
Units of
Limited Limited General Total
Partnership Partners' Partners' Partners'
Interest Capital Deficit Capital
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<S> <C> <C> <C> <C>
Balance - January 1, 2000 25,595 $ 1,522 $ (1,097) $ 425
Net loss (10) (1) (11)
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Balance - March 31, 2000 25,595 $ 1,512 $ (1,098) $ 414
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See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 2000
Statements of Cash Flows (Unaudited)
(In Thousands)
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<CAPTION>
For The Three Months Ended
March 31, March 31,
2000 1999
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<S> <C> <C>
Cash Flows From Operating Activities:
Net loss $ (11) $ (36)
Adjustments to reconcile net loss to net cash used in
operating activities:
Equity in (income) loss of Local Limited Partnership (12) 9
Changes in assets and liabilities:
Increase in accrued interest receivable (2) (3)
Decrease in accrued expenses (6) (1)
Increase in accrued interest payable 7 6
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Net cash used in operating activities (24) (25)
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Net decrease in cash and cash equivalents (24) (25)
Cash and cash equivalents, beginning of period 446 455
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Cash and cash equivalents, end of period $ 422 $ 430
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</TABLE>
See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
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
March 31, 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 months ended March 31, 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
FORM 10-QSB MARCH 31, 2000
Item 2. Management's Discussion and Analysis or Plan of Operation
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
As of March 31, 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 $24,000 decrease as a result of a decrease for the
three months ended March 31, 2000, as compared to December 31, 1999
in net cash used in operating activities. At March 31, 2000, the
Partnership had $422,000 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 $361,000 at March 31, 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
FORM 10-QSB MARCH 31, 2000
Item 2. Management's Discussion and Analysis or Plan of Operation
(Continued)
Liquidity and Capital Resources (Continued)
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 Local Limited Partnership which owns The Villas Apartments
previously entered into a provisional workout agreement with the
U.S. Department of Housing and Urban Development ("HUD"). This
agreement expired on December 30, 1998. In December 1999, HUD
foreclosed on The Villas Apartments. For financial reporting
purposes, the partnership's investment in this local Limited
Partnership had previously been written down to zero. For tax
reporting purposes, the Partnership incurred 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.
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. The
Partnership's investment in this Local Limited Partnership had
previously been written-down to zero.
Results of Operations
Net loss decreased by $25,000 to a net loss of $11,000 for the
three months ended March 31, 2000 as compared to the comparable
period in 1999 due to an increase in income of $22,000 and a
decrease in expenses of $3,000.
Income for the three months ended March 31, 2000, as compared to
the comparable period in 1999, increased primarily due to Equity in
income of a Local Limited Partnership of $12,000 during the three
months ended March 31, 2000 as compared to Equity in loss of Local
Limited Partnership of $9,000 in 1999. Interest income and expenses
remained relatively constant.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 2000
Part II - Other Information
Item 6. Exhibits and Reports on Form 8-K.
(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
March 31, 2000.
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WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 2000
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.
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: May 11, 2000
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Exhibit 99
WINTHROP RESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 2000
Supplementary Information Required Pursuant to Section 9.4 of the Partnership
Agreement
1. Statement of Cash Available for Distribution for the three months
ended March 31, 2000:
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<S> <C>
Net loss $ (11,000)
Less: Equity in income of Local Limited Partnership (12,000)
Add: Cash from reserves 23,000
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Cash Available for Distribution $ -
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2. Fees and other compensation paid or accrued by the Partnership
to the General Partners, or their affiliates, during the three
months ended March 31, 2000:
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<CAPTION>
Entity Receiving Form of
Compensation Compensation Amount
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<S> <C> <C>
None
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<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from Winthrop
Residential Associates I, A Limited Partnership and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<EXCHANGE-RATE> 1.000
<CASH> 422,000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 787,000
<CURRENT-LIABILITIES> 0
<BONDS> 289,000
0
0
<COMMON> 0
<OTHER-SE> 414,000
<TOTAL-LIABILITY-AND-EQUITY> 787,000
<SALES> 0
<TOTAL-REVENUES> 12,000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,000
<INCOME-PRETAX> (11,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (11,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (11,000)
<EPS-BASIC> (0.39)
<EPS-DILUTED> (0.39)
</TABLE>
