August 13, 1998
Securities and Exchange Commission
Filer Support, Edgar
Operation Center, Stop 0-7
6432 General Green Way
Alexandria, VA 22312
Re: Boston Financial Qualified Housing Limited Partnership
Report on Form 10-Q for Quarter Ended June 30, 1998
File No. 0-16796
Dear Sir/Madam:
Pursuant to the requirements of Section 15(d) of the Securities Exchange Act of
1934, filed herewith is a copy of subject report.
Very truly yours,
/s/Dianne Groark
Dianne Groark
Assistant Controller
QH1-Q1.DOC
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under 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 June 30, 1998
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 June 30, 1998 Commission file number 0-16796
--------------- -------------
Boston Financial Qualified Housing Limited Partnership
(Exact name of registrant as specified in its charter)
Delaware 04-2947737
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
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 QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION Page No.
- ------------------------------ --------
Item 1. Financial Statements
<S> <C>
Combined Balance Sheets - June 30, 1998 (Unaudited)
and March 31, 1998 1
Combined Statements of Operations (Unaudited) - For the Three
Months Ended June 30, 1998 and 1997 2
Combined Statement of Changes in Partners' Equity (Deficiency) (Unaudited) -
For the Three Months Ended June 30, 1998 3
Combined Statements of Cash Flows (Unaudited) - For the Three
Months Ended June 30, 1998 and 1997 4
Notes to the Combined Financial Statements (Unaudited) 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
PART II - OTHER INFORMATION
Items 1-6 13
SIGNATURE 14
</TABLE>
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
COMBINED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, March 31,
1998 1998
(Unaudited)
Assets
<S> <C> <C>
Cash and cash equivalents $ 246,982 $ 243,723
Tenant security deposits 4,504 4,731
Accounts receivable, net 2,601 3,000
Marketable securities, at fair value 2,006,558 2,025,236
Mortgagee escrow deposits 1,333 6,020
Replacement reserve escrow 6,398 6,398
Bond trusts 107,572 107,572
Investments in Local Limited Partnerships,
net of reserve for valuation of
$685,201 (Note 1) 1,548,499 1,842,272
Deferred charges, net of accumulated
amortization of $36,275 and $35,469,
in 1998 and 1997, respectively 44,339 45,145
Rental property, at cost, net of
accumulated depreciation 1,102,465 1,112,647
Other assets 41,433 32,193
------------- -------------
Total Assets $ 5,112,684 $ 5,428,937
============= =============
Liabilities and Partners' Equity
Accounts payable to affiliates $ 10,160 $ 22,773
Accounts payable and accrued expenses 23,418 27,577
Accrued interest 68,819 68,819
Tenant security deposits payable 4,621 4,731
Bonds payable 1,210,000 1,210,000
------------- -------------
Total Liabilities 1,317,018 1,333,900
------------- -------------
Minority interest in Local Limited Partnership 58,564 58,589
------------- -------------
General, Initial and Investor Limited Partners' Equity 3,729,525 4,031,390
Net unrealized gains on marketable securities 7,577 5,058
------------- -------------
Total Partners' Equity 3,737,102 4,036,448
------------- -------------
Total Liabilities and Partners' Equity $ 5,112,684 $ 5,428,937
============= =============
</TABLE>
The accompanying notes are integral part of these combined
financial statements.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
COMBINED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months Ended June 30, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
------------- --------
Revenue:
<S> <C> <C>
Rental $ 56,625 $ 58,384
Investment 31,591 37,691
Other 22,546 23,771
------------- -------------
Total Revenue 110,762 119,846
------------- -------------
Expenses:
General and administrative (includes reimbursements
to an affiliate of $30,863 and $51,069, respectively) 85,764 74,242
Rental operations, exclusive of depreciation 19,425 31,723
Interest 30,004 38,278
Depreciation 10,182 10,182
Amortization 8,539 20,922
Adjustment to provision for valuation of
investments in Local Limited Partnerships - (55,803)
------------- -------------
Total Expenses 153,914 119,544
------------- -------------
Income (loss) before minority interest in loss of Local
Limited Partnership and equity in losses of
Local Limited Partnerships (43,152) 302
Minority interest in loss of Local Limited Partnership 25 201
Equity in losses of Local Limited Partnerships (258,738) (589,413)
------------- -------------
Net Loss $ (301,865) $ (588,910)
============= =============
Net Loss allocated
To General Partners $ (3,019) $ (5,889)
To Limited Partners (298,846) (583,021)
------------- -------------
$ (301,865) $ (588,910)
============= =============
Net Loss per Limited Partnership Unit
(50,000 Units) $ (5.98) $ (11.66)
============= ============
</TABLE>
The accompanying notes are integral part of these combined
financial statements.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
COMBINED STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIENCY)
(Unaudited)
For the Three Months Ended June 30, 1998
<TABLE>
<CAPTION>
Initial Investor Net
General Limited Limited Unrealized
Partners Partners Partners Gains Total
<S> <C> <C> <C> <C> <C>
Balance at March 31, 1998 $ (394,183) $ 4,648 $4,420,925 $ 5,058 $ 4,036,448
Net change in net unrealized gains
on marketable securities
available for sale - - - 2,519 2,519
Net Loss (3,019) - (298,846) - (301,865)
----------- ----------- ----------- ------------- --------------
Balance at June 30, 1998 $ (397,202) $ 4,648 $ 4,122,079 $ 7,577 $ 3,737,102
=========== =========== =========== ============= ==============
</TABLE>
The accompanying notes are integral part of these combined
financial statements.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
COMBINED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Three Months Ended June 30, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
------------- --------
<S> <C> <C>
Net cash used for operating activities $ (65,283) $ (61,735)
------------- -------------
Cash flows from investing activities:
Purchases of marketable securities (295,006) (894,769)
Proceeds from sales and maturities of marketable securities 317,246 953,867
Cash distributions received from Local Limited Partnerships 46,302 25,732
Purchase of rental property and equipment - (139)
------------- -------------
Net cash provided by investing activities 68,542 84,691
------------- -------------
Net increase in cash and cash equivalents 3,259 22,956
Cash and cash equivalents, beginning 243,723 453,264
------------- -------------
Cash and cash equivalents, ending $ 246,982 $ 476,220
============= =============
</TABLE>
The accompanying notes are integral part of these combined
financial statements.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
NOTES TO THE COMBINED 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 March 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.
The Managing General Partner has elected to report results of the Local Limited
Partnerships on a 90 day lag basis, because the Local Limited Partnerships
report their results on a calendar year basis. Accordingly, the financial
information about the Local Limited Partnerships that is included in the
accompanying financial statements is as of March 31, 1998 and 1997.
1. Investments in Local Limited Partnerships
The Partnership has acquired interests in thirty-three Local Limited
Partnerships, excluding Hughes Apartments Ltd. ("Hughes"), which own and operate
multi-family housing complexes, all of which are government-assisted. The
Partnership, as Investor Limited Partner pursuant to the various Local Limited
Partnership Agreements, has generally acquired a 99% interest in the profits,
losses, tax credits and cash flows from operations of each of the Local Limited
Partnerships, with the exception of Barrington Manor, Graver Inn, 600 Dakota and
Duluth which are 49.5%. Upon dissolution, proceeds will be distributed according
to each respective partnership agreement.
A summary of Investments in Local Limited Partnerships, excluding Hughes, at
June 30, 1998, is as follows:
<TABLE>
<CAPTION>
<S> <C>
Capital contributions to Local Limited Partnerships and purchase
price paid to withdrawing partners of Local Limited Partnerships $ 36,256,165
Cumulative equity in losses of Local Limited Partnerships
(excluding cumulative unrecognized losses of $23,682,470) (36,002,044)
Cumulative cash distributions received from Local Limited Partnerships (1,648,851)
----------------
Investments in Local Limited Partnerships before adjustment (1,394,730)
Excess of investment cost over the underlying net assets acquired:
Acquisition fees and expenses 4,770,577
Accumulated amortization of acquisition fees and expenses (1,142,147)
----------------
Investments in Local Limited Partnerships 2,233,700
Reserve for Valuation of Investments in
Local Limited Partnerships (685,201)
$ 1,548,499
</TABLE>
The Partnership's share of net losses of the Local Limited Partnerships for the
three months ended June 30, 1998 is $1,408,967. For the three months ended June
30, 1998, the Partnership has not recognized $1,166,751 of equity in losses
relating to twenty-six Local Limited Partnerships where cumulative equity in
losses and cumulative distributions from Local Limited Partnerships exceeded its
total investments in these Local Limited Partnerships.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
NOTES TO THE COMBINED FINANCIAL STATEMENTS (continued)
(Unaudited)
2. Effect of Recently Issued Accounting Standard
The Financial Accounting Standards Board recently issued Statement of Financial
Accounting Standards No. 130, Reporting Comprehensive Income. The Partnership
has adopted the new standard effective April 1, 1998. The adoption of this
standard had no effect on the Partnership's net income or partner's equity.
Comprehensive loss was $299,346 and $581,290 for the quarters ended June 30,
1998 and 1997, respectively. Comprehensive loss includes the change in net
unrealized gains and losses on marketable securities available for sale of
$2,519 and $7,620 for the quarters ended June 30, 1998 and 1997, respectively.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
NOTES TO THE COMBINED FINANCIAL STATEMENTS (continued)
(Unaudited)
3. Supplemental Combining Schedules
Balance Sheets
<TABLE>
<CAPTION>
Boston Financial
Qualified Housing Hughes
Tax Credits Apartments
L.P. (A) Ltd.(B) Eliminations Combined
Assets
<S> <C> <C> <C> <C>
Cash and cash equivalents $ 243,434 $ 3,548 $ - $ 246,982
Tenant security deposits - 4,504 - 4,504
Accounts receivable, net 56,490 - (53,889) 2,601
Marketable securities, at fair value 2,006,558 - - 2,006,558
Mortgagee escrow deposits - 1,333 - 1,333
Replacement reserve escrow - 6,398 - 6,398
Bond trusts - 107,572 - 107,572
Investments in Local Limited
Partnerships, net 1,425,386 - 123,113 1,548,499
Deferred charges, net - 44,339 - 44,339
Rental property at cost, net - 1,102,465 - 1,102,465
Other assets 35,019 6,414 - 41,433
------------- ------------- ------------- -------------
Total Assets $ 3,766,887 $ 1,276,573 $ 69,224 $ 5,112,684
============= ============= ============= =============
Liabilities and Partners' Equity (Deficiency)
Accounts payable to affiliates $ 10,160 $ 53,889 $ (53,889) $ 10,160
Accounts payable and accrued
expenses 19,625 3,793 - 23,418
Accrued interest - 68,819 - 68,819
Tenant security deposits payable - 4,621 - 4,621
Bonds payable - 1,210,000 - 1,210,000
------------- ------------- ------------- -------------
Total Liabilities 29,785 1,341,122 (53,889) 1,317,018
------------- ------------- ------------- -------------
Minority interest in Local Limited
Partnership - - 58,564 58,564
------------- ------------ ------------- -------------
General, Initial and Investor
Limited Partners' Equity (Deficiency) 3,729,525 (64,549) 64,549 3,729,525
Net unrealized gains on marketable
securities 7,577 - - 7,577
------------- ------------- ------------- -------------
Total Partners' Equity (Deficiency) 3,737,102 (64,549) 64,549 3,737,102
------------- ------------- ------------- -------------
Total Liabilities and
Partners' Equity (Deficiency) $ 3,766,887 $ 1,276,573 $ 69,224 $ 5,112,684
============= ============= ============= =============
</TABLE>
(A) As of June 30, 1998.
(B) As of March 31, 1998.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
NOTES TO THE COMBINED FINANCIAL STATEMENTS (continued)
(Unaudited)
3. Supplemental Combining Schedules (continued)
Statements of Operations
<TABLE>
<CAPTION>
Boston Financial
Qualified Housing Hughes
Tax Credits Apartments
L.P. (A) Ltd.(B) Eliminations Combined
Revenue
<S> <C> <C> <C> <C>
Rental $ - $ 56,625 $ - $ 56,625
Investment 31,478 113 - 31,591
Other 21,370 1,176 - 22,546
------------- ------------- ------------- -------------
Total Revenue 52,848 57,914 - 110,762
------------- ------------- ------------- -------------
Expenses:
General and administrative 85,764 - - 85,764
Rental operations, exclusive
of depreciation - 19,425 - 19,425
Interest - 30,004 - 30,004
Depreciation - 10,182 - 10,182
Amortization 7,733 806 - 8,539
------------- ------------- ------------ -------------
Total Expenses 93,497 60,417 - 153,914
------------- ------------- ------------ -------------
Loss before minority interest in loss of
Local Limited Partnership and equity
in losses of Local Limited
Partnerships (40,649) (2,503) - (43,152)
Minority interest in loss of
Local Limited Partnership - - 25 25
Equity in losses of Local
Limited Partnerships (261,216) - 2,478 (258,738)
------------- ------------- ------------ -------------
Net Loss $ (301,865) $ (2,503) $ 2,503 $ (301,865)
============= ============= ============ =============
</TABLE>
(A) For the three months ended June 30, 1998.
(B) For the three months ended March 31, 1998.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
NOTES TO THE COMBINED FINANCIAL STATEMENTS (continued)
(Unaudited)
3. Supplemental Combining Schedules (continued)
Statements of Cash Flows
<TABLE>
<CAPTION>
Boston Financial
Qualified Housing Hughes
Tax Credits Apartments
L.P. (A) Ltd.(B) Eliminations Combined
Net cash provided by (used for)
<S> <C> <C> <C> <C>
operating activities $ (66,367) $ 1,084 $ - $ (65,283)
------------- ------------- ------------- -------------
Cash flows from investing activities:
Purchases of marketable securities (295,006) - - (295,006)
Proceeds from sales and maturities
of marketable securities 317,246 - - 317,246
Cash distributions received from
Local Limited Partnerships 46,302 - - 46,302
------------- ------------- ------------- -------------
Net cash provided by investing
activities 68,542 - - 68,542
------------- ------------- ------------- -------------
Net increase in cash and cash equivalents 2,175 1,084 - 3,259
Cash and cash equivalents, beginning 241,259 2,464 - 243,723
------------- ------------- ------------- -------------
Cash and cash equivalents, ending $ 243,434 $ 3,548 $ - $ 246,982
============= ============= ============= =============
</TABLE>
(A) For the three months ended June 30, 1998.
(B) For the three months ended March 31, 1998.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
At June 30, 1998, the Partnership, including the combined entity (Hughes
Apartments, Ltd.), has cash and cash equivalents of $246,982 as compared with
$243,723 at March 31, 1998. The increase is attributable to cash distributions
received from Local Partnerships and proceeds from sales and maturities of
marketable securities in excess of purchases of marketable securities. The
increase is offset by cash used for operating activities.
At June 30, 1998, approximately $1,680,000 of cash, cash equivalents and
marketable securities has been designated as Reserves. The Reserves 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.
Since the Partnership invests as a limited partner, the Partnership has no
contractual duty to provide additional funds to Local Limited Partnerships
beyond its specified investment. Thus, at June 30, 1998, the Partnership had no
contractual or other obligation to any Local Limited Partnership which had not
been paid or provided for.
In the event a Local Limited Partnership encounters operating difficulties
requiring additional funds, the Partnership's management might deem it in its
best interests to provide such funds, voluntarily, in order to protect its
investment.
Cash Distributions
No cash distributions to Limited Partners were made during the three months
ended June 30, 1998. In the event that distributions are received from Local
Limited Partnerships, the Managing General Partner has decided that such amounts
will be used to increase Reserves. No assurance can be given as to the amounts
of future distributions from the Local Limited Partnerships since many of the
Properties benefit from some type of federal or state subsidy and, as a
consequence, are subject to restrictions on cash distributions. Therefore, it is
expected that only a limited amount of cash will be distributed to investors
from this source in the future.
Results of Operations
The Partnership's results of operations for the three months ended June 30, 1998
resulted in a net loss of $301,865 as compared to a net loss of $588,910 for the
same period in 1997. The decrease in net loss is primarily attributable to a
decrease in equity in losses of Local Limited Partnerships due to an increase in
losses not recognized by the Partnership for Local Limited Partnerships whose
cumulative equity in losses and cumulative distributions exceeded its total
investment in these partnerships.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Property Discussions
Limited Partnership interests have been acquired in thirty-four Local Limited
Partnerships which own and operate rental properties located in nineteen states.
Fourteen of the properties with 774 apartments were newly constructed and twenty
of the properties with 2,091 apartments were rehabilitated.
Most of the thirty-four Local Limited Partnerships have stabilized operations.
The majority of these stabilized properties are operating at break-even or
generating positive operating cash flow.
A number of properties are experiencing operating difficulties and cash flow
deficits due to a variety of reasons. The Local General Partners of those
properties have funded operating deficits through project expense loans,
subordinated loans or payments from operating escrows. In certain instances
where the Local General Partners have stopped funding deficits because their
obligation to do so has expired or otherwise, the Managing General Partner is
working with the Local General Partners to increase operating income, reduce
expenses or refinance the debt at lower interest rates in order to improve cash
flow.
As previously reported, the Local General Partner of 600 Dakota, Graver Inn and
Barrington Manor, located in North Dakota, and Duluth, located in South Dakota,
expressed to the Managing General Partner some concerns over the long-term
financial health of the properties. In response to these concerns and to reduce
possible future risk, the Managing General Partner consummated the transfer of
50% of the Partnership's capital and profits in the properties to an affiliate
of the Local General Partner in November 1997. The Managing General Partner has
the right to transfer the Partnership's remaining interest to the Local General
Partner any time after one year has elapsed. The Managing General Partner
continues to monitor property operations closely. In addition, the Local General
Partner has the right to call the remaining interest after the tax credit period
has expired.
As previously reported Boulevard Common, located in Chicago, Illinois, has been
experiencing operating deficits. Occupancy as of March 31, 1998 is 83%, down
from 91% at December 31, 1997. Expenses have been increasing due to high
turnover at the property, security issues and increasing maintenance and capital
needs. The Local General Partner has requested assistance from the Managing
General Partner in funding the capital improvements. The Managing General
Partner is currently reviewing this request and has requested a workout plan
from the Local General Partner detailing where and how these funds will be used.
The Managing General Partner is monitoring property operations closely.
Delmar, located in Gillette, Wyoming has been experiencing operating deficits.
In addition, a significant amount of capital improvements on the property need
to be completed in the very near future. In the past deficits were being funded
by a combination of the accrual of property management fees and the Local
General Partner. Due to the Managing General Partner's concerns regarding the
long term viability of this property, negotiations with the Local General
Partner are underway to develop a plan that will ultimately transfer ownership
of the property to the Local General Partner. The plan includes provisions to
minimize the risk of recapture.
As previously reported, the Managing General Partner at Pebble Creek, located in
Arlington, Texas, is negotiating with HUD to extend and/or modify the existing
workout agreement which expired May 31, 1998. In addition, the Managing General
Partner is involved in negotiations for the appointment of a replacement Local
General Partner. Occupancy as of March 31, 1998 is 98%.
As previously reported, Cass House and Verdean Gardens, Massachusetts properties
which share a common Local General Partner, continues to operate below
break-even. Both properties, as well as Bittersweet Apartments, have received
SHARP subsidies in the past which have been an important part of their annual
income. Effective October 1, 1997, the Massachusetts Housing Finance Agency
(MHFA) which provided the SHARP subsidies, withdrew future SHARP mortgage
subsidies from its portfolio of 77 SHARP subsidized properties. The Managing
General
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Property Discussions (continued)
Partner has joined a group of interested parties and is working with MHFA to
find a solution to the problems that will result as a result of withdrawn
subsidies. Given existing operating deficits and the dependence on these
subsidies by Cass House, Verdean Gardens and Bittersweet, it is likely that all
three properties will default on their mortgage obligations in the near future.
It is possible that Partnership Reserves will be used to support these
properties until these issues can be resolved. The carrying value of the
Partnership's investment in these Local Limited Partnerships is zero at June 30,
1998.
The Local General Partner for Brentwood Manor II, in Nashua, New Hampshire,
filed for protection under the provisions of the Chapter 7 bankruptcy laws. The
Managing General Partner's request to replace the Local General Partner with a
substitute general partner was denied by the lender. The Managing General
Partner has replaced the former Local General Partner as management agent of the
property with an affiliated third-party management agent. As noted previously,
although full mortgage payments are being made at this time, partial mortgage
payments were made earlier in the year prior to the Local General Partner
declaring bankruptcy. The lender required that the small deficit generated by
the deficient payments be cured immediately. The Managing General Partner is
negotiating with both the lender and the Local General Partner to develop a plan
for the payment of this amount. It is possible that Partnership Reserves will be
used to pay this deficit.
Sierra Pointe, located in Las Vegas, Nevada and Terrace, located in Oklahoma
City, Oklahoma, which share a common Local General Partner, are experiencing
operating deficits due to low occupancy. The March 31, 1998 occupancy for Sierra
Pointe is 74% and for Terrace is 80%. The Managing General Partner and the Local
General Partner are working with the local Housing Authorities in both Nevada
and Oklahoma to fill vacant units. Further, the Managing General Partner and
Local General Partner negotiated a replacement for the current management agent
of Sierra Pointe. The new management agent for Sierra Pointe started March 1,
1998. The Managing General Partner continues to work with the Local General
Partner and management agent in an effort to stabilize operations and improve
occupancy.
In accordance with Financial Accounting Standard No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of",
which is effective for fiscal years beginning after December 15, 1995, the
Partnership has implemented policies and practices for assessing impairment of
its real estate assets and investments in local limited partnerships. Each asset
is analyzed by real estate experts to determine if an impairment indicator
exists. If so, the carrying value is compared to the future cash flows expected
to be derived from the asset. If the total undiscounted cash flows are less than
the carrying value, a provision to write down the asset to fair value will be
charged against income.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(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 June 30, 1998.
<PAGE>
BOSTON FINANCIAL QUALIFIED HOUSING LIMITED PARTNERSHIP
(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.
DATED: August 13, 1998 BOSTON FINANCIAL QUALIFIED HOUSING
LIMITED PARTNERSHIP
By: 29 Franklin Street, Inc.,
its Managing General Partner
/s/Randolph G. Hawthorne
Randolph G. Hawthorne
Managing Director, Vice President and
Chief Operating Officer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-END> JUN-30-1998
<CASH> 246,982
<SECURITIES> 2,006,558
<RECEIVABLES> 000
<ALLOWANCES> 000
<INVENTORY> 000
<CURRENT-ASSETS> 000
<PP&E> 1,102,465
<DEPRECIATION> 000
<TOTAL-ASSETS> 5,112,684<F1>
<CURRENT-LIABILITIES> 000
<BONDS> 1,210,000
000
000
<COMMON> 000
<OTHER-SE> 3,737,102
<TOTAL-LIABILITY-AND-EQUITY> 5,112,684<F2>
<SALES> 000
<TOTAL-REVENUES> 110,762<F3>
<CGS> 000
<TOTAL-COSTS> 000
<OTHER-EXPENSES> 123,910<F4>
<LOSS-PROVISION> 000
<INTEREST-EXPENSE> 30,004
<INCOME-PRETAX> 000
<INCOME-TAX> 000
<INCOME-CONTINUING> 000
<DISCONTINUED> 000
<EXTRAORDINARY> 000
<CHANGES> 000
<NET-INCOME> (301,865)<F5>
<EPS-PRIMARY> (5.98)
<EPS-DILUTED> 000
<FN>
<F1>Included in total assets is $4,504 of tenant security deposits, Investments
in Local Limited Partnerships of $1,548,499, deferred charges, net $44,339, bond
trusts of $107,572, mortgagee escrow deposits of $1,333, replacement reserve
escrow of $6,398, other assets of $41,433, and accounts receivable of $2,601.
<F2>Included in total liability and equity is accounts payable to affiliates
$10,160, accounts payable and accrued expenses of $23,418, accrued interest of
$68,819, tenant security deposits payable of $4,621, and $58,564 of minority
interest in Local Limited Partnership. <F3>Total revenue includes rental of
$56,625, investment of $31,591 and other of $22,546. <F4>Included in other
expenses is general and administrative of $85,764, rental operations, exclusive
of depreciation of $19,425, depreciation of $10,182 and amortization of $8,539.
<F5>Net loss reflects equity in losses of Local Limited Partnerships of
$(258,738) and minority interest in loss of Local Limited Partnership of $25.
</FN>
</TABLE>
