<PAGE>
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, 1997 Commission File Number 0-15740
------------------- -------
RIVERSIDE PARK ASSOCIATES LIMITED PARTNERSHIP
-----------------------------------------------------------------
(exact name of small business issuer as specified in its charter)
Delaware 04-2924048
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Five Cambridge Center, Cambridge, MA 02142-1493
- ---------------------------------------- ----------
(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 X NO
----- -----
<PAGE>
Riverside Park Associates Limited Partnership
<TABLE>
<CAPTION>
BALANCE SHEETS
- ----------------------------------------------------------------------------------------------
September 30, December 31,
1997 1996
(Unaudited) (Audited)
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Investment in Real Estate
Land $ 6,357,564 $ 6,357,564
Building improvements and personal property 66,716,880 66,162,838
------------ ------------
73,074,444 72,520,402
Less accumulated depreciation 31,078,919 28,930,286
------------ ------------
41,995,525 43,590,116
Cash and cash equivalents 1,832,048 3,011,885
Mortgage reserves held in escrow 627,041 181,850
Prepaid and other assets 204,142 542,719
Deferred costs, net of accumulated
amortization of $223,035 and $82,956, respectively 1,183,000 1,320,779
------------ ------------
Total Assets $ 45,841,756 $ 48,647,349
============ ============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Mortgage payable $ 46,307,936 $ 46,736,982
Accrued interest - mortgage -- 326,997
Accounts payable 6,868 167,445
Accrued expenses 351,418 145,313
Tenants' security deposits liability 145,081 193,116
------------ ------------
Total Liabilities 46,811,303 47,569,853
------------ ------------
Partners' Capital
Limited partners capital, 566 units
authorized and outstanding, 191,393 2,177,025
General partner's capital (1,160,940) (1,099,529)
------------ ------------
Total Partners' Capital (969,547) 1,077,496
------------ ------------
Total Liabilities and Partners' Capital $ 45,841,756 $ 48,647,349
============ ============
</TABLE>
See notes to financial statements
- 2 -
<PAGE>
Riverside Park Associates Limited Partnership
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS
- -----------------------------------------------------------------------------------------------------------------------
Three months ended September 30, Nine months ended September 30,
For the nine and three months ended 1997 1996 1997 1996
September 30, 1997 and 1996 (Unaudited) (Unaudited) (Unaudited) (Unaudited)
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Income
Rental $ 2,473,886 $ 2,347,651 $ 7,379,892 $ 7,204,856
Interest on short-term
investments 19,326 12,664 88,443 55,177
Other 254,226 338,058 777,946 858,953
----------- ----------- ----------- -----------
2,747,438 2,698,373 8,246,281 8,118,986
Expenses
Leasing 84,110 70,384 180,953 174,103
Payroll and benefits 208,286 178,279 515,534 502,985
General and administrative 19,555 21,630 33,443 63,296
Management fees 135,350 144,074 446,517 439,199
Utilities 278,074 230,654 830,327 783,693
Repairs and maintenance 257,918 219,347 634,307 606,594
Insurance 41,992 41,941 125,975 125,823
Taxes 190,629 175,482 569,597 517,772
----------- ----------- ----------- -----------
Total operating expenses 1,215,914 1,081,791 3,336,653 3,213,465
Other expenses
Depreciation 716,211 739,077 2,148,633 2,217,231
Amortization 46,694 -- 140,079 103,817
Interest expense 996,913 892,276 2,948,144 3,045,157
Other expenses 78,661 84,415 261,054 364,558
----------- ----------- ----------- -----------
Total expenses 3,054,393 2,797,559 8,834,563 8,944,228
Net loss $ (306,955) $ (99,186) $ (588,282) $ (825,242)
=========== =========== =========== ===========
Net loss allocated to general partner
$ (9,209) $ (2,976) $ (17,648) $ (24,757)
=========== =========== =========== ===========
Net loss allocated to limited partners $ (297,746) $ (96,210) $ (570,634) $ (800,485)
=========== =========== =========== ===========
Net loss per unit outstanding - limited
partners $ (526) $ (170) $ (1,008) $ (1,414)
=========== =========== =========== ===========
Weighted average number of units outstanding
566 566 566 566
=========== =========== =========== ===========
</TABLE>
See notes to financial statements
- 3 -
<PAGE>
Riverside Park Associates Limited Partnership
<TABLE>
<CAPTION>
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
- --------------------------------------------------------------------------------------
For the nine months ended General Limited Total
September 30, 1997 and 1996 Partners' Partners' Partners'
(Unaudited) capital capital capital
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
Balance December 31, 1996 $ (1,099,529) $ 2,177,025 $ 1,077,496
Net loss (17,648) (570,634) (588,282)
Distributions (43,763) (1,414,998) (1,458,761)
------------ ------------ ------------
Balance, September 30, 1997 $ (1,160,940) $ 191,393 $ (969,547)
============ ============ ============
Balance December 31, 1995 $ (952,194) $ 11,324,006 $ 10,371,812
Net loss (24,757) (800,485) (825,242)
Distributions (232,253) (7,509,504) (7,741,757)
------------ ------------ ------------
Balance, September 30, 1996 $ (1,209,204) $ 3,014,017 $ 1,804,813
============ ============ ============
</TABLE>
See notes to financial statements
- 4 -
<PAGE>
Riverside Park Associates Limited Partnership
<TABLE>
<CAPTION>
STATEMENTS OF CASH FLOWS
- ---------------------------------------------------------------------------------------------------
For the nine months ended 1997 1996
September 30, 1997 and 1996 (Unaudited) (Unaudited)
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash flow from operating activities:
Net loss $ (588,282) $ (825,242)
Adjustments to reconcile net loss to
net cash provided by operating activities:
Depreciation 2,148,633 2,217,231
Amortization 140,079 103,817
Changes in assets and liabilities:
Decrease (increase) in prepaid and other assets 338,577 (111,012)
Increase (decrease) in accounts payable and accrued
expenses 45,528 (390,859)
Decrease in tenants security deposits (48,035) (7,041)
Decrease in accrued mortgage interest (326,997) --
------------ ------------
Net cash provided by operating activities 1,709,503 986,894
------------ ------------
Cash flows from investing activities:
Acquisition of and improvements to property (554,042) (487,628)
Additions to deferred cost (2,300) --
Increase in mortgage reserves held in escrow (445,191) --
------------ ------------
Net cash used in investing activities (1,001,533) (487,628)
------------ ------------
Cash flows from financing activities:
Principal payments on mortgage note (429,046) (38,114,269)
Distributions to partners (1,458,761) (1,167,010)
Proceeds from mortgage financing -- 47,000,000
Additions to deferred loan cost -- (1,397,725)
------------ ------------
Net cash (used in) provided by financing activities (1,887,807) 6,320,996
------------ ------------
Net (decrease) increase in cash and cash equivalents (1,179,837) 6,820,262
Cash and cash equivalents, beginning of period 3,011,885 2,752,859
------------ ------------
Cash and cash equivalents, ending $ 1,832,048 $ 9,573,121
============ ============
Supplemental disclosure of cash flow information:
Cash paid for interest $ 2,948,144 $ 3,401,550
============ ============
</TABLE>
See notes to financial statements
- 5 -
<PAGE>
Riverside Park Associates Limited Partnership
NOTES TO FINANCIAL STATEMENTS
September 30, 1997
(Unaudited)
1. ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed financial statements included herein have been prepared by
Riverside Park Associates Limited Partnership (the "Partnership",) without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission. The Partnership's accounting and financial reporting policies
conform with generally accepted accounting principles and include 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 notes thereto included in the
Partnership's Annual Report on Form 10-KSB for the year ended December 31, 1996.
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, 1997.
2. TAXABLE INCOME
The Partnership's results of operations on a tax basis are expected to differ
from net loss for financial reporting purposes primarily due to the accounting
differences in the recognition of depreciation and amortization.
3. RELATED PARTY TRANSACTIONS
The Partnership paid an affiliate of the General Partner property management
fees of $106,046 and $315,620 and $102,724 and $315,150 for the three and nine
months ended September 30, 1997 and 1996, respectively. An investor service fee
of $29,304 and $130,897 and $41,350 and $124,049 for the three and nine months
ended September 30, 1997 and 1996, respectively, was also paid to an affiliate
of the General Partner.
4. RECLASSIFICATION
Certain items in the 1996 statements of operations have been reclassified to
conform with the current year presentation.
- 6 -
<PAGE>
Riverside Park Associates Limited Partnership
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
Liquidity and Capital Resources
The Partnership's sole asset is a 1,222 unit apartment complex known as
Riverside Park located in Fairfax County, Virginia. The property is leased to
tenants subject to leases of up to one year. The Partnership requires cash to
pay principal and interest on the mortgage loan encumbering the property and to
pay operating expenses in connection with the property, including management
fees and general and administrative expenses. The Partnership continues to have
positive cash flow after its operating and debt service requirements and
provides cash distributions to its partners. It is expected that the
Partnership's income will be sufficient in future years to continue to pay these
expenses as well as to provide for cash distributions to its partners.
The level of liquidity based on cash and cash equivalents experienced a
$1,179,837 decrease at September 30, 1997 as compared to December 31, 1996. The
decrease was due to $1,709,503 of net cash provided by operating activities
being offset by $1,001,533 of net cash used in investing activities and
$1,887,807 of cash used in financing activities. Investing activities consisted
of $554,042 of improvements to real estate, $445,191 of deposits to replacement
reserves and $2,300 in additions to deferred costs. Financing activities
consisted of $429,046 of mortgage principal payments and $1,458,761 of
distributions to limited partners. All other increases (decreases) in certain
assets and liabilities are the result of the timing of receipt and payment of
various operating activities.
The Washington, D.C. area apartment market is stable and remains competitive.
The Partnership continues to make capital improvements to the property to
enhance its competitiveness within the local market. The Partnership spent
$554,042 on capital improvements during the first nine months of 1997 compared
to $487,628 in the first nine months of 1996. Improvements include common area
hallway renovations and individual HVAC system replacements. As of September 30,
1997, the Partnership had a cash balance of approximately $1,832,048, as well as
$627,041 that is being held by the lender in a reserve account to complete unit
renovations as compared to $3,011,885 in cash and $181,850 in reserves at
December 31, 1996.
The property's mortgage loan is evidenced by a promissory note payable by the
Partnership to General Electric Credit Corporation "GECC" and secured by a
mortgage in favor of GECC on the property in the original amount of $47,000,000.
The mortgage loan, which bears interest at the rate LIBOR 2.75%, requires
monthly payments of principal and interest totaling $367,532. The mortgage loan
matures in September 2001, at which time a balloon payment of the remaining
outstanding principal balance will be due.
On November 27, 1995, an affiliate of the Managing General Partner acquired,
pursuant to a tender offer for a purchase price of $40,000 per unit,
approximately 35% of the total limited partnership units of the Registrant (200
units).
- 7 -
<PAGE>
Riverside Park Associates Limited Partnership
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION (Continued)
Results of Operations
The Partnership's net loss declined from $825,242 for the nine months ended
September 30, 1996 to $588,282 for the nine months ended September 30, 1997.
Excluding noncash items such as depreciation and amortization, however, the
Partnership's property has generated positive cash flow, which the Partnership
used to make improvements to the property, pay down the loan encumbering the
property, and provide distributions to the partners.
The Partnership's rental revenue increased from $7,204,856 to $7,379,892 for the
first nine months of 1997 compared to the first nine months of 1996. Rental
income increased as a result of an increase in average rental charges from $672
per unit in 1996 to $704 per unit in 1997, which was partially offset by a
decrease in average occupancy to 96.1% in the nine months ended September 30,
1997 compared to 97% for the same nine months in 1996. Interest income increased
from $55,177 to $88,443 during the nine months ended September 30, 1996 and
1997, respectively, as a result of interest earnings on higher escrowed cash
balances.
Other income decreased from $858,953 in 1996 to $777,946 in 1997. This decrease
relates primarily to a decrease in corporate unit income.
The total operating costs of the Partnership's property remained relatively
stable increasing by less than 4% or $123,188 from $3,213,465 for the nine
months ended September 30, 1996 to $3,336,653 for the nine months ended
September 30, 1997. Higher leasing, payroll and benefits, management fees,
utilities, repairs and maintenance, and real estate taxes were partially offset
by reductions in general and administrative costs. The Partnership's
depreciation and amortization expense categories were consistent with the
results for the same period in 1996.
Interest expense decreased from $3,045,157 for the nine months ended September
30, 1996 to $2,948,144 for the nine months ended September 30, 1997 due to a
lower interest rate on the loan encumbering the property, which was refinanced
in September, 1996, and a reduction in the outstanding amount of principal due
to the monthly principal payments amounts.
Other expenses decreased from $364,558 to $261,054 in the first nine months of
1997 primarily as a result of a nonrecurring litigation fee incurred in 1996.
The results of operations in future quarters may differ from the results of
operations for the nine months ended September 30, 1997, due to inflation and
changing economic conditions which could affect occupancy levels, rental rates
and operating expenses.
- 8 -
<PAGE>
Riverside Park Associates Limited Partnership
PART II - OTHER INFORMATION
Item 5 - Other Information
On October 28, 1997, Insignia Financial Group ("Insignia") acquired 100% of
the Class B stock of First Winthrop Corporation ("FWC"), the sole shareholder of
the Registrant's General Partner. In connection with this transaction, a nominee
of Insignia was elected as a director of the General Partner and has been
appointed to the board of directors of the General Partner. The nominee has the
authority to appoint members to a newly created residential committee. This
committee is generally authorized to act on behalf of the General Partner in
managing the business activities of the Registrant. On October 28, 1997, the
partnership terminated Winthrop Management as the managing agent, and appointed
an affiliate of Insignia to assume management of the property. The General
Partner does not believe this transaction will have a material effect on the
affairs and operations of the Registrant.
An affiliate of the Managing General Partner entered into an agreement to
sell all of its limited partnership units to IPTI, LLC, an affiliate of
Insignia. The transfer of these units took place October 27, 1997.
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits
27. Financial Data Schedule
(b) Reports on Form 8-K
No report on Form 8-K was filed during the three months ended September 30,
1997.
- 9 -
<PAGE>
Riverside Park Associates 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.
RIVERSIDE PARK ASSOCIATES
LIMITED PARTNERSHIP
By: Winthrop Financial Associates, A Limited
Partnership
Its General Partner
Date: November 14, 1997 By: /s/ Edward V. Williams
----------------------------------------
Edward V. Williams
Chief Financial Officer
Date: November 14, 1997 By: /s/ Richard J. McCready
----------------------------------------
Richard J. McCready
Chief Executive Officer
- 10 -
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information
extracted from unaudited financial statements for the
nine month period ending September 30, 1997 and is
qualified in its entirety by reference to such financial
statements
</LEGEND>
<CIK> 0000813812
<NAME> RIVERSIDE PARK ASSOCIATES LIMITED PARTNERSHIP
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<EXCHANGE-RATE> 1
<CASH> 1,832,048
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 73,074,444
<DEPRECIATION> (31,078,919)
<TOTAL-ASSETS> 45,841,756
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> (191,393)
<TOTAL-LIABILITY-AND-EQUITY> 45,841,756
<SALES> 0
<TOTAL-REVENUES> 8,157,838
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,303,210
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,948,144
<INCOME-PRETAX> (588,282)
<INCOME-TAX> 0
<INCOME-CONTINUING> (588,282)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (588,282)
<EPS-PRIMARY> (1,008.19)
<EPS-DILUTED> (1,008.19)
</TABLE>
