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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1998 Commission File Number 0-12210
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
(exact name of small business issuer as specified in its charter)
Maryland 04-2801764
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Five Cambridge Center, Cambridge, MA 02142
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(Address of principle executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 234-3000
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
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
PART 1 - FINANCIAL INFORMATION
ITEM 1. - FINANCIAL STATEMENTS
BALANCE SHEETS
<TABLE>
<CAPTION>
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September December
30, 1998 31, 1997
(Unaudited) (Audited)
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<S> <C> <C>
ASSETS
Assets
Cash and cash equivalents $ 192,061 $ 249,420
Due from Operating Partnership 7,518 44,020
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Total assets $ 199,579 $ 293,440
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LIABILITIES AND PARTNERS' CAPITAL
Liabilities and partners' capital
Partners' capital $ 199,579 $ 293,440
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Total liabilities and partners' capital $ 199,579 $ 293,440
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See notes to financial statements
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
(UNAUDITED)
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<CAPTION>
For the Three Months For, the Nine Months
Ended September 30, Ended September 30,
1998 1997 1998 1997
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INCOME
<S> <C> <C> <C> <C>
Interest $ 2,034 $ 1,339 $ 5,710 $ 6,989
Distribution from operating partnership - - 161,706 104,603
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2,034 1,339 167,416 111,592
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EXPENSES
Other expenses 14,212 - 14,212 -
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Total operating expenses 14,212 - 14,212 -
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Net income (loss) $ (12,178) $ 1,339 $ 153,204 $ 111,592
=============== =============== =============== ===============
Net income per unit of limited
partnership interest outstanding $ (20) $ 2 $ 257 $ 187
=============== =============== =============== ===============
(590 units issued and outstanding)
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See notes to financial statements
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
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<CAPTION>
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Linnaeus-
Phoenix
For the Nine Months Ended Winthrop Associates Investor Total
September 30, 1998 and 1997 Financial Limited Limited Partners'
(Unaudited) Co. Inc. Partnership Partners Capital
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<S> <C> <C> <C> <C>
Balance, December 31, 1997 $ (270,579) $ (572,488) $ 1,136,507 $ 293,440
Net income 766 766 151,672 153,204
Distributions (1,250) (1,250) (247,500) (250,000)
Contributions - - 2,935 2,935
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Balance, September 30, 1998 $ (271,063) $ (572,972) $ 1,043,614 $ 199,579
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Balance, December 31, 1996 $ (270,361) $ (572,270) $ 1,176,091 $ 333,460
Net income 558 558 110,476 111,592
Distributions (1,524) (1,524) (301,756) (304,804)
Contributions - - 3,580 3,580
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Balance, September 30, 1997 $ (271,327) $ (573,236) $ 988,391 $ 143,828
================== ================= ================= =================
</TABLE>
See notes to financial statements
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
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<CAPTION>
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For the Nine Months Ended
(Unaudited) 1998 1997
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<S> <C> <C>
Cash flow from operating activities:
Net income $ 153,204 $ 111,572
Adjustments to reconcile net income to
net cash provided by operating activities
Decrease (increase) in due from operating partnership 36,502 (28,374)
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Net cash provided by operating activities 189,706 83,198
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Cash flows from financing activities:
Partner distributions (250,000) (304,804)
Contributions 2,935 3,580
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Net cash used in financing activities (247,065) (301,224)
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Net decrease in cash and cash equivalents (57,359) (218,026)
Cash and cash equivalents at beginning of period 249,420 319,440
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Cash and cash equivalents at end of period $ 192,061 $ 101,414
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</TABLE>
See notes to financial statements
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
September 30, 1998
(Unaudited)
1. ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed financial statements included herein have been prepared by the
Partnership, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. The Partnership's accounting and financial
reporting policies are in conformity with generally accepted accounting
principles and include all 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
financial statements be read in conjunction with the financial statements and
the notes thereto included in the Partnership's Annual Report on Form 10-KSB
for the year ended December 31, 1997.
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, 1998.
2. INVESTMENT IN OPERATING PARTNERSHIP
The Partnership accounts for its investment in Presidential Towers, Ltd. (the
"Operating Partnership") using the equity method of accounting. Under the
equity method of accounting, the initial investment is recorded at cost,
increased or decreased by the Partnership's share of income or losses, and
decreased by distributions. Equity in the loss of the Operating Partnership is
no longer recognized once the investment balance reaches zero.
The loss from the Operating Partnership, not recognized since the investment
balance reached zero, will be offset against the Partnership's share of future
income from the Operating Partnership.
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This Item should be read in conjunction with the financial statements and other
items contained elsewhere in the report.
Liquidity and Capital Resources
The Partnership's primary source of liquidity is distributions from
Presidential Towers Ltd., an Illinois limited partnership (the "Operating
Partnership"). The Partnership is responsible for paying various administrative
costs associated with monitoring the Partnership's investment in the Operating
Partnership, and paying various professional fees associated with the affairs
of the Partnership.
During the nine months ended September 30, 1998 and September 30, 1997, the
Operating Partnership made distributions to the Partnership of $161,706 and
$104,603, respectively. In addition, the Partnership is entitled to receive an
annual distribution from the Operating Partnership as a reimbursement of the
Partnership's administrative expenses and professional fees up to an annual
maximum of $30,000.
The Partnership's liquidity based on cash and cash equivalents decreased to
$192,061 at September 30, 1998 as compared to $249,420 at December 31, 1997. As
discussed above, the Partnership received a distribution from the Operating
Partnership; however, in August 1998 the Partnership made a distribution of
$250,000 to its partners. Future distributions to limited partners are
contingent upon the receipt by the Partnership of distributions from the
Operating Partnership.
Results of Operations
Operating results increased by $41,612 for the nine months ended September 30,
1998 as compared to the nine months ended September 30, 1997 due primarily to
an increase in distributions from the Operating Partnership in 1998. The
increase in distributions was partially offset by $14,212 of expenses in excess
of the $30,000 expense reimbursement provided by the Operating Partnership.
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
PART II - OTHER INFORMATION
Item 6. Exhibit and reports on Form 8-K
a) Exhibits
Exhibit 27, Financial Data Schedule B filed as an Exhibit to
this report
b) Reports on Form 8-K
No report on Form 8-K was required to be filed during the period
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
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.
PRESIDENTIAL ASSOCIATES I
LIMITED PARTNERSHIP
(Partnership)
By: Winthrop Financial Co., Inc.
One of its General Partners
Date: November 4, 1998 By: /s/ Edward V. Williams
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Edward V. Williams
Chief Financial Officer
Date: November 4, 1998 By: /s/ Michael L. Ashner
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Michael L. Ashner
Chief Executive Officer
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