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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 June 30, 2000 Commission File Number 0-12210
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
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(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 principal 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 NO X
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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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June 30, 2000 December 31,
(Unaudited) 1999 (Audited)
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<S> <C> <C>
ASSETS
Assets
Cash and cash equivalents $ 603,348 $ 433,334
Due from Operating Partnership 30,000 --
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Total assets $ 633,348 $ 433,334
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LIABILITIES AND PARTNERS' CAPITAL
Liabilities and partners' capital
Partners' capital $ 633,348 $ 433,334
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Total liabilities and partners' capital $ 633,348 $ 433,334
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</TABLE>
See notes to financial statements
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
(UNAUDITED)
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<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30,
2000 1999 2000 1999
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<S> <C> <C> <C> <C>
INCOME:
Interest $ 4,103 $ 2,683 $ 7,804 $ 5,161
Distribution from Operating
Partnership 225,210 200,036 225,210 200,036
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229,313 202,719 233,014 205,197
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EXPENSES:
Professional fees 31,927 -- 31,927 --
Other expenses 1,073 134 1,073 134
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Total operating expenses 33,000 134 33,000 134
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Net income $196,313 $202,585 $200,014 $203,063
======== ========= ======== ========
Net income per unit of limited
partnership interest outstanding
(590 units issued and outstanding) $ 331 $ 340 $ 335 $ 344
======== ======== ======== ========
</TABLE>
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 Six Months Ended Winthrop Associates Investor Total
June 30, 2000 and 1999 Financial Co., Limited Limited Partners
(Unaudited) Inc. Partnership Partners Capital
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<S> <C> <C> <C> <C>
Balance, December 31, 1998 $ (270,262) $ (572,171) $ 1,202,447 $ 360,014
Net income 1,025 1,025 203,013 205,063
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Balance, June 30, 1999 $ (269,237) $ (571,146) $ 1,405,460 $ 565,077
============ =========== ============= ============
Balance, December 31, 1999 $ (269,914) $ (571,823) $ 1,275,071 $ 433,334
Net income 1,000 1,000 198,014 200,014
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Balance, June 30, 2000 $ (268,914) $ (570,823) $ 1,473,085 $ 633,348
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</TABLE>
See notes to financial statements
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
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For the Six Months Ended
June 30, 2000 and 1999 (Unaudited) 2000 1999
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Cash flow from operating activities:
Net income $ 200,014 $ 205,063
Adjustments to reconcile net income to net cash
provided by operating activities:
(Increase) decrease in due from Operating Partnership (30,000) 135,886
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Net cash provided by operating activities 170,014 340,949
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Cash and cash equivalents at beginning of period 433,334 186,610
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Cash and cash equivalents at end of period $ 603,348 527,559
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See notes to financial statements
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
June 30, 2000
(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, 1999.
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, 2000.
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.
3. TAXABLE LOSS
The Partnership's taxable loss is not expected to differ from that for financial
reporting purposes.
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
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.) The discussion of the
Partnership's business 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 business and results of 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
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 three months ended June 30, 2000 and June 30, 1999, the Operating
Partnership did not make any distributions to the Partnership. A significant
restructuring of the ownership and debt of the Operating Partnership was
finalized in April 1995. As a result of this restructuring, 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. In addition, the Operating Partnership
distributes to the Partnership an amount equal to the amount of income allocated
to the Partnership by the Operating Partnership in each year. It is not expected
that the Operating Partnership will be able to make any distributions to the
Partnership in excess of these amounts until the property is sold. However, due
to the preferred return required to be paid to TKI Presidential Partners and the
Department of Housing and Urban Development, it is likely that a sale of the
property will not generate sufficient funds to permit a distribution to the
Partnership. Accordingly, it is anticipated that limited partners will not
receive a return of their original investment in the Partnership.
The Partnership's liquidity based on cash and cash equivalents increased by
$170,014 to $603,348 at June 30, 2000 as compared to December 31, 1999. It is
expected that so long as the Partnership's administrative expenses do not exceed
$30,000 in any year, the Partnership's cash and cash equivalents will remain
relatively constant until the Operating Partnership is liquidated.
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
Results of Operations
The Partnership's net income for the three and six months ended June 30, 2000
was $196,313 and $200,014, respectively, compared to $202,585 and $205,063 for
the comparable periods ended June 30, 1999. The decreases in net income are
attributable to an increase in total expenses which more than offset an increase
in total income. Income increased due primarily due to increased distributions
from the Operating Partnership. In addition, interest income increased due to
increased cash balances. The increase in expenses was due to increases in
professional fees and other expenses.
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PRESIDENTIAL ASSOCIATES I LIMITED PARTNERSHIP
PART II - OTHER INFORMATION
Item 6. Exhibit and reports on Form 8-K
No report on Form 8-K was required to be filed during the period
a) Exhibits
Exhibit 27, Financial Data Schedule B filed as an Exhibit to this report
b) Reports on Form 8-K
No reports on Form 8-K were required to be filed during the three
months ended June 30, 2000
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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: August 11, 2000 By: /s/ Thomas C. Staples
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Thomas C. Staples
Chief Financial Officer
Date: August 11, 2000 By: /s/ Michael L. Ashner
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Michael L. Ashner
Chief Executive Officer
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