May 14, 1996
Securities and Exchange Commission
Filer Support, Edgar
Operation Center, Stop 0-7
6432 General Green Way
Alexandria, VA 22312
Re: Boston Financial Apartments Associates, L.P.
Report on Form 10-Q Edgar for Quarter Ended March 31, 1996
File No. 0-10057
Dear Sir/Madam:
Pursuant to the requirements of Rule 901(d) of Regulation S-T, enclosed is one
copy of subject report.
Please stamp and return the enclosed copy of this letter in the enclosed
stamped, self-addressed envelope to acknowledge receipt of this filing.
Very truly yours,
Marie D. Ricciardi
Assistant Controller
BFAA-10Q1.DOC
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
(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, 1996
------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from to
-------------------------- -------------------
For Quarter Ended March 31, 1996 Commission file number 0-10057
------------------ --------------
Boston Financial Apartments Associates, L.P.
(Exact name of registrant as specified in its charter)
Delaware 04-2734133
- - --------------------------------- ------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or oragnization)
101 Arch Street, Boston, Massachusetts 02110-1106
- - ------------------------------------------------- --------------------------
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (617) 439-3911
- - -----------------------------------------------------
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 .
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION Page No.
- - ------------------------------ --------
Item 1. Financial Statements
Balance Sheets - March 31, 1996 (Unaudited)
and December 31, 1995 1
Statements of Operations (Unaudited) - For the Three
Months Ended March 31, 1996 and 1995 2
Statement of Changes in Partners' Equity (Deficiency) (Unaudited) -
For the Three Months Ended March 31, 1996 3
Statements of Cash Flows (Unaudited) - For the Three
Months Ended March 31, 1996 and 1995 4
Notes to the Financial Statements (Unaudited) 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II - OTHER INFORMATION
Items 1-6 10
SIGNATURE 11
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
(Unaudited)
Assets
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 84,252 $ 121,361
Interest receivable 4,500 18,444
Other current assets 5,086 5,594
----------- -----------
Total current assets 93,838 145,399
Marketable securities, at fair value (Note 1) 816,666 998,083
Investments in Local Limited Partnerships (Note 2) -- --
----------- -----------
Total Assets $ 910,504 $ 1,143,482
=========== ===========
Liabilities and Partners' Deficiency
Current liabilities:
Accounts payable to affiliate $ 9,374 $ 8,972
Accounts payable and accrued expenses 25,240 20,667
Notes payable and accrued interest 1,182,500 1,168,750
----------- -----------
Total current liabilities 1,217,114 1,198,389
Partners' Deficiency (306,610) (54,907)
----------- -----------
Total Liabilities and Partners' Deficiency $ 910,504 $ 1,143,482
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months Ended March 31, 1996 and 1995
<TABLE>
<CAPTION>
1996 1995
----------- -----------
<S> <C> <C>
Revenue:
Distribution $ 16,668 $ 116,707
Investment and other 14,178 23,017
----------- -----------
Total Revenue 30,846 139,724
----------- -----------
Expenses:
General and administrative expense (includes
reimbursement to affiliate in the amounts of
$23,466 and $15,209 in 1996 and 1995, respectively) 35,773 30,132
Interest 13,750 13,750
Management Fees, related party 1,667 11,671
----------- -----------
Total Expenses 51,190 55,553
----------- -----------
Income (loss) before loss on liquidation of interest in Local Limited
Partnership, equity in income of Local Limited Partnerships and
cancellation of indebtedness (20,344) 84,171
Loss on liquidation of interest in Local
Limited Partnership -- (773,964)
Equity in income of Local Limited
Partnerships -- 1,980,282
----------- -----------
Income (loss) before extraordinary item (20,344) 1,290,489
Extraordinary gain on cancellation
of indebtedness -- 61,000
----------- -----------
Net Income (loss) $ (20,344) $ 1,351,489
=========== ===========
Net Income (loss) allocated:
To the General Partners $ (1,017) $ 98,533
To the Limited Partners (19,327) 1,252,956
----------- -----------
$ (20,344) $ 1,351,489
=========== ===========
Income (loss) before extraordinary item allocated
to the Limited Partners per Limited Partnership
Unit (21,915 Units) $ (.88) $ 54.53
=========== ===========
Extraordinary gain on cancellation of indebtedness
allocated to the Limited Partners per Limited
Partnership Unit (21,915 Units) $ -- $ 2.65
=========== ===========
Net Income (Loss) per Limited Partnership
Unit (21,915 Units) $ (.88) $ 57.18
=========== ===========
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIENCY)
(Unaudited)
For the Three Months Ended March 31, 1996
<TABLE>
<CAPTION>
Net
Unrealized
General Limited Gains
Partners Partners (Losses) Total
<S> <C> <C> <C> <C>
Balance at December 31, 1995 $(907,785) $ 841,376 $ 11,502 $ (54,907)
Cash distribution -- (219,150) -- (219,150)
Change in unrealized gains on
marketable securities
available for sale -- -- (12,209) (12,209)
Net loss (1,017) (19,327) -- (20,344)
--------- --------- --------- ---------
Balance at March 31, 1996 $(908,802) $ 602,899 $ (707) $(306,610)
========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
For the Three Months Ended March 31, 1996 and 1995
<TABLE>
<CAPTION>
1996 1995
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (20,344) $ 1,351,489
Adjustments to reconcile net income (loss)
to net cash provided by (used for) operating activities:
Loss on liquidation of interest in Local Limited Partnership -- 773,964
Distribution income included in cash distributions
received from Local Limited Partnerships (16,668) (116,707)
Equity in income of Local Limited Partnerships -- (1,980,282)
Extraordinary item:
Cancellation of indebtedness -- (61,000)
Gain on sale of marketable securities (1,539) (1,100)
Increase (decrease) in cash arising from changes in operating assets and
liabilities:
Interest receivable 13,944 (799)
Other current assets 508 1,506
Accounts payable to affiliate 402 31,992
Accounts payable and accrued expenses 4,573 (8,069)
Notes payable and accrued interest 13,750 13,750
----------- -----------
Net cash provided by (used for) operating activities (5,374) 4,744
----------- -----------
Cash flows from investing activities:
Purchases of marketable securities -- (483,978)
Proceeds from sales and maturities of
marketable securities 170,747 469,542
Cash distributions received from Local
Limited Partnerships 16,668 941,540
----------- -----------
Net cash provided by investing activities 187,415 927,104
----------- -----------
Cash flows from financing activities:
Cash distribution (219,150) (657,450)
Payment of note payable and accrued interest -- (624,833)
----------- -----------
Net cash used for financing activities (219,150) (1,282,283)
----------- -----------
Net decrease in cash and cash equivalents (37,109) (350,435)
Cash and cash equivalents, beginning 121,361 350,435
----------- -----------
Cash and cash equivalents, ending $ 84,252 $ --
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
Notes to the Financial Statements
(Unaudited)
The unaudited financial statements presented herein have been prepared in
accordance with the instructions to Form 10-Q and do not include all of the
information and note disclosures required by generally accepted accounting
principles. These statements should be read in conjunction with the financial
statements and notes thereto included with the Partnership's 10-K for the year
ended December 31, 1995. In the opinion of management, these financial
statements include all adjustments, consisting only of normal recurring
adjustments, necessary to present fairly the Partnership's financial position
and results of operations. The results of operations for the periods may not be
indicative of the results to be expected for the year. Certain reclassifications
have been made to prior period financial statements to conform to current period
classifications.
1. Marketable Securities
A summary of marketable securities is as follows:
<TABLE>
<CAPTION>
Gross Gross
Unrealized Unrealized Fair
Cost Gains Losses Value
<S> <C> <C> <C> <C>
Debt securities issued by the US
Treasury and other US government
corporations and agencies $583,692 $ 944 $ (2,456) $582,180
Mortgage backed securities 87,427 -- (632) 86,795
Other debt securities 146,254 1,592 (155) 147,691
-------- -------- -------- --------
Balance at March 31, 1996 $817,373 $ 2,536 $ (3,243) $816,666
======== ======== ======== ========
Debt securities issued by the US
Treasury and other US
government agencies $729,567 $ 9,410 $ -- $738,977
Mortgage backed securities 97,453 259 -- 97,712
Other debt securities 159,561 2,094 (261) 161,394
-------- -------- -------- --------
Balance at December 31, 1995 $986,581 $ 11,763 $ (261) $998,083
======== ======== ======== ========
</TABLE>
The contractual maturities at March 31, 1996 are as follows:
<TABLE>
<CAPTION>
Fair
Cost Value
<S> <C> <C>
Due in one year to five years $729,946 $729,871
Mortgage backed securities 87,427 86,795
-------- --------
$817,373 $816,666
======== ========
</TABLE>
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
Notes to the Financial Statements (continued)
(Unaudited)
1. Marketable Securities (continued)
Actual maturities may differ from contractual maturities because some issuers
have the right to call or prepay obligations. Proceeds from the sales of fixed
maturities were approximately $171,000 and $470,000 during the three months
ended March 31, 1996 and 1995, respectively. Gross gains of $2,289 and $1,999
and gross losses of $750 and $899 were realized on these sales for the three
months ended March 31, 1996 and 1995, respectively.
2. Investments in Local Limited Partnerships
As of March 31, 1996 and December 31, 1995, the Partnership's Investment in
Local Limited Partnerships, at cost, was as follows:
<TABLE>
<CAPTION>
Capital Contribu- Net Equity Cash
tions and Related in Income Distributions
Local Limited Acquisition Costs (Losses) Received Net
Partnerships (Cumulative) (Cumulative) (Cumulative) (1) Investment
- - ------------------------------------------------------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Bear Creek $ 796,556 $ (290,570) $ (505,986) $ --
Buttonwood Tree 1,482,996 (1,482,996) -- --
Captain's Landing 1,057,682 (1,057,682) -- --
Chelsea Village 2,076,589 (2,076,589) -- --
Mountain View 422,593 (422,593) -- --
Oakdale Manor 1,522,621 (1,522,621) -- --
Oakwood Terrace 614,643 (614,643) -- --
Overland Station 1,232,286 816,511 (1,274,833) 773,964
Park Hill 825,501 (713,066) (112,435) --
Pheasant Ridge 1,050,237 (972,180) (78,057) --
The Woods of Castleton 2,025,681 (2,025,681) -- --
Westpark Plaza 1,846,469 (1,115,914) (730,555) --
Woodbridge 1,077,161 (1,060,493) (16,668) --
Woodmeade South 1,619,452 (1,619,452) -- --
Youngstoun 935,861 (935,861) -- --
------------ ------------ ------------ ------------
Subtotal 18,586,328 (15,093,830) (2,718,534) 773,964
Less dispositions:
Overland Station (1,232,286) (816,511) 1,274,833 (773,964)
Captain's Landing (1,057,682) 1,057,682 -- --
Oakwood Terrace (614,643) 614,643 -- --
------------ ------------ ------------ ------------
Balance at
March 31, 1996 $ 15,681,717 $(14,238,016) $ (1,443,701) $ --
============ ============ ============ ============
Balance at
December 31, 1995 $ 15,681,717 $(14,254,684) $ (1,427,033) $ --
============ ============ ============ ============
</TABLE>
(1) Included in cash distributions received is cumulative distribution income of
$826,531 which was received from five Local Limited Partnerships with carrying
values of zero.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
Notes to the Financial Statements (continued)
(Unaudited)
2. Investments in Local Limited Partnerships (continued)
Summarized financial information from the combined financial statements of all
Local Limited Partnerships in which the Partnership has invested is as follows:
Summarized Balance Sheets - March 31, 1996 (Unaudited)
<TABLE>
<CAPTION>
<S> <C>
Assets:
Current assets $ 1,806,183
Other assets 3,826,261
Investment property, net 34,174,856
------------
Total Assets $ 39,807,300
============
Liabilities and Partners' Deficiency:
Current liabilities $ 4,829,484
Other debt 5,941,560
Long-term debt 55,290,360
------------
Total Liabilities 66,061,404
Partners' Deficiency (26,254,104)
------------
Total Liabilities and Partners' Deficiency $ 39,807,300
============
Summarized Income Statements - For the
Three Months Ended March 31, 1996 (Unaudited)
Rental and other income $ 3,061,446
------------
Expenses:
Operating 1,573,957
Interest 1,248,159
Depreciation and amortization 478,345
------------
Total Expenses 3,300,461
Net Loss $ (239,015)
============
Partnership's share of net loss $ (234,242)
============
Other Partners' share of net loss $ (4,773)
============
</TABLE>
For the three months ended March 31, 1996, the Partnership has not recognized
$298,853 of equity in losses relating to ten Local Limited Partnerships where
cumulative equity in losses and cumulative distributions have exceeded its total
investments. Also, during the three months ended March 31, 1996, the Partnership
recognized $47,943 of equity in losses which were previously unrecognized.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
At March 31, 1996, the Partnership had cash and cash equivalents of $84,252
compared with $121,361 at December 31, 1995. The decrease in cash and cash
equivalents is due to cash distributions paid to limited partners, offset by
proceeds received from the sales and maturities of marketable securities and
cash distributions received from Local Limited Partnerships.
At March 31, 1996, approximately $866,000 has been reserved and is invested in
various securities. The reserves as defined in the Partnership Agreement were
established to be used for working capital of the Partnership and contingencies
related to the ownership of Local Limited Partnership interests. Reserves may be
used to fund Partnership operating deficits, if the Managing General Partner
deems funding appropriate in order to protect its investment.
Since the Partnership has invested as a limited partner in all Local Limited
Partnerships, it has no contractual duty to provide additional funds to Local
Limited Partnerships beyond its specified investment. At March 31, 1996, it did
not have any contractual or other obligation to any Local Limited Partnership
which had not been paid or provided for.
Future cash distributions will be derived almost exclusively from distributions
of net cash provided by operations of the Local Limited Partnerships. Such cash
is not expected to be significant in 1996, and therefore, there is no assurance
that adequate cash will be available to warrant cash distributions in future
years.
Results of Operations
The Partnership's results of operations for the three months ended March 31,
1996 resulted in a net loss of $20,344 as compared to net income of $1,351,489
for the same period in 1995. The net income position during the 1995 three month
period is primarily attributable to equity in income generated by the sale of
Overland Station. This income was supplemented by cancellation of indebtedness
income, also due to the Overland Station sale.Offsetting these items was the
loss on disposition of Overland Station.
The net loss position during the 1996 three month period is attributable to
Partnership administrative expenses and interest expense in excess of income
received from Local Limited Partnerships and investment income during the three
month period.
The equity in losses of Local Limited Partnerships was reduced to zero due to
cumulative losses in excess of the investment in the Local Limited Partnerships.
Distribution income was received from one Local Limited Partnership. Please
refer to the property discussions section for more information on the property
operations.
Property Discussions
HUD has a program to sell all performing and non-performing mortgages in a
public auction that is scheduled to take place on a region-by-region basis over
the next few years. The mortgages of Oakdale Manor and Woods of Castleton, were
to be included in an April 15, 1996 HUD non-performing loan auction. However,
the auction has since been postponed until May 15, 1996. Chelsea Village's
mortgage was also to be included in the April 15, 1996 HUD auction and this
mortgage will now be included in a August, 1996 auction. The continued
feasibility of these properties may depend on the ability of the local general
partner or the Partnership or their respective affiliates to purchase the
mortgages or to negotiate a satisfactory arrangement with the buyer.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Property Discussions (continued)
As previously reported, the local general partner of Mountain View Apartments
and Woodmeade South Apartments placed both of the properties into Chapter 11
bankruptcy. The effective date of the bankruptcy plan was March 24, 1996. In
order for the Partnership to retain an equity interest in these two properties,
the bankruptcy plan required that the Partnership make additional contributions.
Management of the Partnership has decided that additional contributions would
not be in the best interest of the Partnership. The Partnership's relinquishment
of its equity interest in these two Local Limited Partnerships will have no
material impact on the Partnership financial statements, since the Partnership
is a limited partner and the two Local Limited Partnerships currently have
carrying values of zero. For tax purposes, there may be a gain on disposal of
the Local Limited Partnership recognized by the Partnership. Limited Partners of
the Partnership will incur a recapture tax. The total tax liability for the
Limited Partners will depend on the extent they have used current and suspended
losses from this investment.
Youngstoun Apartments II, located in Hagerstown, Maryland, continues to
experience a low level of occupancy during the first quarter of 1996, resulting
in an operating deficit. The property's occupancy was 81% at March 31, 1996.
Property Dispositions
As previously reported, the Managing General Partner of Overland Station
Investment Company sold the property on January 12, 1995. The results of this
transaction are reflected in the March 31, 1995 information included in this
report. Please refer to Form 10-K dated December 31, 1995 for additional
information.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
PART II OTHER INFORMATION
Items 1-5 Not applicable
Item 6 Exhibits and reports on Form 8-K
(a) Exhibits - None
(b) Reports on Form 8-K - No reports on Form 8-K were filed
during the quarter ended March 31, 1996.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
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.
BOSTON FINANCIAL APARTMENTS
ASSOCIATES, L.P.
By: BFTG Residential Properties, Inc.
its Managing General Partner
/s/ Fred N. Pratt, Jr. Dated: May 14, 1996
--------------------------------------
By: Fred N. Pratt, Jr.
President, Chief Executive Officer
and Director
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1996
<CASH> 84,252
<SECURITIES> 816,666
<RECEIVABLES> 4,500
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 5,086
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 910,504
<CURRENT-LIABILITIES> 1,217,114<F1>
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> (306,610)
<TOTAL-LIABILITY-AND-EQUITY> 910,504
<SALES> 0
<TOTAL-REVENUES> 30,846<F2>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 37,440<F3>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 13,750
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (20,344)
<EPS-PRIMARY> (.88)
<EPS-DILUTED> 0
<FN>
<F1> Included in Current liabilities is a note payable and accrued interest of
$1,182,500 and Accounts payable and accrued expenses of $34,614.
<F2>Represents Distribution income of $16,668 and Investment and other income
of $14,178.
<F3>Includes $35,773 of General and administrative expenses and $1,667 of Asset
management fees.
</FN>
</TABLE>
