May 13, 1999
Securities and Exchange Commission
Filer Support, Edgar
Operation Center, Stop O-7
6432 General Green Way
Alexandria, VA 22312
Re: Boston Financial Apartments Associates, L.P.
Report on Form 10-QSB Edgar for Quarter Ended March 31, 1999
File No. 0-10057
Dear Sir/Madam:
Pursuant to the requirements of Section 15(d) of the Securities Exchange Act of
1934, there is filed herewith one copy of subject report.
Very truly yours,
/s/Stephen Guilmette
Stephen Guilmette
Assistant Controller
BFAA-10Q1.DOC
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
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, 1999
-----------------------------------------------
OR
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACTOOF 1934
For the transition period from to
--------------------- -----------------
For Quarter Ended March 31, 1999 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 organization)
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)
BALANCE SHEET
March 31, 1999
(Unaudited)
Assets
Cash and cash equivalents $ 59,291
Interest receivable 10,333
Marketable securities, at fair value 1,028,593
Other assets 983
Investments in Local Limited Partnerships (Note 1) -
-------------
Total Assets $ 1,099,200
=============
Liabilities and Partners' Equity
Liabilities:
Accounts payable to affiliate $ 11,924
Accounts payable and accrued expenses 37,877
-------------
Total Liabilities 49,801
Partners' Equity (Deficiency) 1,049,399
-------------
Total Liabilities and Partners' Equity (Deficiency) $ 1,099,200
=============
The accompanying notes are an integral part of these financial statements
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 1999 and 1998
(Unaudited)
1999 1998
----------- ------------
Revenue:
Distribution $ - $ 124,564
Investment and other 12,970 12,169
----------- ------------
Total Revenue 12,970 136,733
----------- ------------
Expenses:
General and administrative
(includes reimbursement to affiliate in
the amounts of $17,367 and $20,037
in 1999 and 1998, respectively) 31,800 30,884
Management Fees, related party - 12,456
----------- ------------
Total Expenses 31,800 43,340
----------- ------------
Net Income (Loss) $ (18,830) $ 93,393
============ ============
Net Income (Loss) allocated:
To the General Partners $ (942) $ 4,670
To the Limited Partners (17,888) 88,723
----------- ------------
$ (18,830) $ 93,393
============ ============
Net Income (Loss) per Limited Partnership
Unit (21,915 Units) $ (0.82) $ 4.05
============ ============
The accompanying notes are an integral part of these financial statements
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIENCY)
For the Three Months Ended March 31, 1999
(Unaudited)
<TABLE>
<CAPTION>
Net
General Limited Unrealized
Partners Partners Gains Total
<S> <C> <C> <C> <C>
Balance at December 31, 1998 $ (851,344) $ 1,913,745 $ 7,110 $ 1,069,511
------------ ----------- ----------- ------------
Comprehensive Loss:
Net Loss (942) (17,888) - (18,830)
Net change in net unrealized
gains on marketable
securities available for sale - - (1,282) (1,282)
------------ ----------- ----------- ------------
Comprehensive Loss (942) (17,888) (1,282) (20,112)
------------ ----------- ----------- ------------
Balance at March 31, 1999 $ (852,286) $ 1,895,857 $ 5,828 $ 1,049,399
============ =========== =========== ============
</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
For the Three Months Ended March 31, 1999 and 1998
(Unaudited)
<TABLE>
<CAPTION>
1999 1998
------------- -------------
<S> <C> <C>
Net cash used for operating activities $ (5,785) $ (36,506)
Net cash provided by (used for) investing activities (94,222) 154,731
------------- -------------
Net increase (decrease) in cash and cash equivalents (100,007) 118,225
Cash and cash equivalents, beginning 159,298 142,840
------------- -------------
Cash and cash equivalents, ending $ 59,291 $ 261,065
============= =============
</TABLE>
The accompaning 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-QSB 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-KSB for the year
ended December 31, 1998. 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.
1. Investments in Local Limited Partnerships
As of March 31, 1999 and December 31, 1998, 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 $ 47,013 $ (843,569) $ -
Buttonwood Tree 1,482,996 (1,415,154) (67,842) -
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 (687,453) (138,048) -
Pheasant Ridge 1,050,237 (924,712) (125,525) -
The Woods of Castleton 2,025,681 (2,025,681) - -
Westpark Plaza 1,846,469 (1,094,803) (751,666) -
Woodbridge 1,077,161 (1,044,146) (33,015) -
Woodmeade South 1,619,452 (1,619,452) - -
Youngstoun 935,861 (935,861) - -
----------------- ------------- --------------- -----------
Subtotal 18,586,328 (14,577,866) (3,234,498) 773,964
Less dispositions:
Mountain View (422,593) 422,593 - -
Woodmeade South (1,619,452) 1,619,452 - -
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 - -
Oakdale Manor (1,522,621) 1,522,621 - -
----------------- ------------- --------------- -----------
Balance at
March 31, 1999 $ 12,117,051 $ (10,157,386) $ (1,959,665) $ -
================= ============= ============== ===========
Balance at
December 31, 1998 $ 12,117,051 $ (10,157,386) $ (1,959,665) $ -
================= ============= ============== ===========
</TABLE>
(1) Included in cash distributions received is cumulative distribution income of
$1,342,495 which was received from six 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)
1. Investments in Local Limited Partnerships (continued)
The Partnership's ownership interest in each Local Limited Partnership is
generally 99%. The Partnership's share of net losses for the three months ended
March 31, 1999 is $96,529. For the three months ended March 31, 1999, the
Partnership has not recognized $187,598 of equity in losses relating to five
Local Limited Partnerships where cumulative equity in losses and cumulative
distributions have exceeded its total investments. Also, during the three months
ended March 31, 1999, the Partnership recognized $91,069 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
Certain matters discussed herein constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The
Partnership intends such forward-looking statements to be covered by the safe
harbor provisions for forward-looking statements, and are including this
statement for purposes of complying with these safe harbor provisions. Although
the Partnership believes the forward-looking statements are based on reasonable
assumptions, the Partnership can give no assurance that their expectations will
be attained. Actual results and timing of certain events could differ materially
from those projected in or contemplated by the forward-looking statements due to
a number of factors, including, without limitation, general economic and real
estate conditions, interest rates, and unanticipated delays or expenses on the
part of the Partnership and their suppliers in achieving year 2000 compliance.
At March 31, 1999, the Partnership had cash and cash equivalents of $59,291
compared with $159,298 at December 31, 1998. The decrease in cash and cash
equivalents is primarily the result of the purchase of marketable securities.
This is offset by proceeds from the sale of marketable securities.
At March 31, 1999, approximately $1,038,000 has been reserved and is partially
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.
As of March 31, 1999, investment in Local Limited Partnerships remained at zero,
unchanged from December 31, 1998.
Since the Partnership has invested as a limited partner, it has no contractual
duty to provide additional funds to Local Limited Partnerships beyond its
specified investment. The Partnership's contractual obligations have been fully
met. Thus, at March 31, 1999, 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 1999, 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,
1999 resulted in a net loss of $18,830, as compared to net income of $93,393 for
the same period in 1998. The decrease is primarily due to an decrease in
distribution income received from Local Limited Partnerships. The decrease is
partially offset by an decrease in management fees which are based on
distribution income received from Local Limited Partnerships.
The equity in losses of Local Limited Partnerships is zero due to cumulative
losses and cumulative distributions in excess of the investment in the Local
Limited Partnerships. Please refer to the section entitled `Property
Discussions' section for more information on the property operations.
<PAGE>
BOSTON FINANCIAL APARTMENTS ASSOCIATES, L.P.
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Property Discussions
The Partnership owns limited partnership interests in nine Local Limited
Partnerships which own and operate multi-family residential properties. The
Partnership also owns investments in securities in which some of its Reserves
are held.
Four of the Local Limited Partnerships are operating at cash flow deficits (net
loss adjusted for depreciation, mortgage principal payments and replacement
reserve payments). In past years, the Local General Partners funded these
deficits either through non-interest bearing project expense loans or
subordinated loans, repayable only out of cash flow or proceeds from a sale or
refinancing of the given project. Once a project achieves break-even,
substantial amounts of cash flow derived from its operations will be used to
repay project expense loans and subordinated loans until the loans are repaid in
full. To address current deficits or other financial difficulties, Local General
Partners are working to increase rental income and reduce operating expenses,
working with the lenders to refinance property mortgages or seeking other
sources of capital. Management may make voluntary advances from the
Partnership's Reserves to a Local Limited Partnership encountering operating
difficulties if it is deemed to be in the best interest of the Partnership to
provide such funds.
Impact of the Year 2000
The Managing General Partner's plan to resolve year 2000 issues involves the
following four phases: assessment, remediation, testing and implementation. To
date, the Managing General Partner has fully completed an assessment of all
information systems that may not be operative subsequent to 1999 and has begun
the remediation, testing and implementation phase on both hardware and software
systems. Because the hardware and software systems of both the Partnership and
Local Limited Partnerships are generally the responsibility of obligated third
parties, the plan primarily involves ongoing discussions with and obtaining
written assurances from these third parties that pertinent systems will be 2000
compliant. In addition, neither the Partnership nor the Local Limited
Partnerships are incurring significant additional costs since such expenses are
principally covered under the service contracts with vendors. Most major systems
have already been updated and assurances have been obtained that any remaining
testing and updating will be complete by mid 1999. However, despite the
likelihood that all significant year 2000 issues are expected to be resolved in
a timely manner, the Managing General Partner has no means of ensuring that all
systems of outside vendors or other entities that impact operations will be 2000
compliant. The Managing General Partner does not believe that the inability of
third parties to address their year 2000 issues in a timely manner will have a
material impact on the Partnership. However, the effect of non-compliance by
third parties is not readily determinable.
Management has also evaluated a worst case scenario projection with respect to
the year 2000 and expects any resulting disruption of either the Managing
General Partner's activities or any Local Limited Partnership's operations to be
short-term inconveniences. Such problems, however, are not likely to fully
impede the ability to carry out necessary duties of the Partnership. Moreover,
because expected problems under a worst case scenario are not extensively
detrimental and, because the likelihood that all systems affecting the
Partnership will be compliant in early 1999, the Managing General Partner has
determined that a formal contingency plan that responds to material system
failures is not necessary.
<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, 1999.
<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/Michael H. Gladstone
Michael H. Gladstone
Director
Dated: May 13, 1999
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 59,291
<SECURITIES> 1,028,593
<RECEIVABLES> 10,333
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,099,200 <F1>
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 1,049,399
<TOTAL-LIABILITY-AND-EQUITY> 1,099,200 <F2>
<SALES> 0
<TOTAL-REVENUES> 12,970<F3>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 31,800 <F4>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (18,830)
<EPS-PRIMARY> (0.82)
<EPS-DILUTED> 0
<FN>
<F1> Includes Other assets of $983.
<F2> Includes Accounts payable to affiliate of $11,924 and Accounts payable and
accrued expenses of $37,877.
<F3>Represents Investment and other revenue of $12,970.
<F4>Represents General and administrative expenses of $31,800.
</FN>
</TABLE>
