EXHIBIT 99.1
Contact: Susan B. Railey FOR IMMEDIATE RELEASE
(301) 468-3120
Sharon Bramell
(301) 231-0351
AIM 85 REPORTS SECOND QUARTER NET EARNINGS
OF 11 CENTS PER UNIT
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ROCKVILLE, MD, August 13, 2003--(AMEX/AII) -- American Insured Mortgage
Investors-Series 85, L.P. (AIM 85), a liquidating partnership that holds
investments in government insured multifamily mortgages, reported net earnings
for the three months ended June 30, 2003 of approximately $1.3 million (11 cents
per unit) compared to approximately $1.4 million (11 cents per unit) for the
three months ended June 30, 2002. Net earnings decreased by approximately
$39,000 in the second quarter of 2003, compared to the same period in 2002,
primarily due to a decrease in mortgage investment income, which was partially
offset by an increase in gains on mortgage dispositions.
For the six months ended June 30, 2003, AIM 85 reported net earnings of
approximately $2.8 million (23 cents per unit) compared to approximately $4.0
million (32 cents per unit) for the first six months of 2002. Net earnings
decreased for the six months ended June 30, 2003, as compared to the
corresponding period in 2002, primarily due to decreases in mortgage investment
income and gains on mortgage dispositions.
Mortgage investment income decreased for the three and six months ended
June 30, 2003 due to the disposition of 12 mortgages with an aggregate principal
balance of approximately $16.2 million, representing an approximate 21% decrease
in the aggregate principal balance of the total mortgage portfolio since June
2002.
Gains on mortgage dispositions increased for the three months and decreased
for the six months ended June 30 2003, as compared to the corresponding periods
in 2002. During the second quarter of 2003, AIM 85 recognized gains of
approximately $293,000 from three mortgage prepayments and one mortgage
assignment, compared to a gain of approximately $9,000 from one mortgage
prepayment during the second quarter of 2002. During the first six months of
2003, AIM 85 recognized gains of approximately $746,000 from four mortgage
prepayments and three mortgage assignments as compared to gain of approximately
$1.2 million from two mortgage prepayments and three mortgage assignments during
the same period in 2002.
As of June 30, 2003, AIM 85 was invested in 22 insured mortgages and two
debentures with an aggregate amortized cost of approximately $61.0 million, an
aggregate face value of approximately $61.9 million and an aggregate fair value
of approximately $63.0 million.
In July 2003, AIM 85 declared a distribution of four cents per unit,
payable on November 3, 2003, related to proceeds received in June 2003 from the
prepayment of the mortgage on Ashley Oaks Apartments.
Also in July 2003, HUD transferred assignment proceeds to AIM 85, as record
owner, in the form of a 5.75% debenture in exchange for the mortgage on College
Green Apartments. AIM 85, as a 50% beneficial owner, is entitled to receive
approximately $1.3 million of the face value of the debenture when redeemed.
As of August 1, 2003, three of AIM 85's mortgages are in the Section 221
assignment process: Brougham Estates, Town Park Apartments and Kaynorth
Apartments. The aggregate face value of these mortgages was approximately $4.7
million as of the HUD put dates.
As the Partnership continues to liquidate its mortgage investments and
investors receive distributions of return of capital and taxable gains,
investors should expect a reduction in earnings and distributions due to the
decreasing mortgage base.
2
AMERICAN INSURED MORTGAGE INVESTORS - SERIES 85, L.P.
STATEMENTS OF INCOME
(Unaudited)
For the three months ended For the six months ended
June 30, June 30,
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2003 2002 2003 2002
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Income:
Mortgage investment income $ 1,262,635 $ 1,579,485 $ 2,583,860 $ 3,199,956
Interest and other income 39,858 88,082 63,882 194,286
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1,302,493 1,667,567 2,647,742 3,394,242
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Expenses:
Asset management fee to related parties 157,123 191,725 320,574 381,506
General and administrative 115,950 123,362 223,041 222,336
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273,073 315,087 543,615 603,842
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Net earnings before gains on
mortgage dispositions 1,029,420 1,352,480 2,104,127 2,790,400
Gains on mortgage dispositions 293,044 8,768 745,870 1,177,927
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Net earnings $ 1,322,464 $ 1,361,248 $ 2,849,997 $ 3,968,327
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Net earnings allocated to:
Limited partners - 96.1% $ 1,270,888 $ 1,308,159 $ 2,738,847 $ 3,813,562
General Partner - 3.9% 51,576 53,089 111,150 154,765
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$ 1,322,464 $ 1,361,248 $ 2,849,997 $ 3,968,327
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Net earnings per unit of limited
partnership interest - basic $ 0.11 $ 0.11 $ 0.23 $ 0.32
============ ============ ============ ============
Limited partnership units outstanding - basic 12,079,514 12,079,514 12,079,514 12,079,514
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Balance Sheet Data: June 30, December 31,
2003 2002
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Investment in insured mortgages $ 60,263,207 $ 66,323,565
Total assets 67,648,800 78,237,534