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 March 31, 1996 Commission File Number 04-29240
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
One International Place, Boston, MA 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 330-8600
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
BALANCE SHEETS
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March 31, December 31,
1996 1995
(Unaudited) (Audited)
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ASSETS
Investment in Real Estate
Land $ 6,357,564 $ 6,357,564
Building improvements and personal property 65,745,230 65,541,641
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72,102,794 71,899,205
Less accumulated depreciation 26,795,564 26,065,442
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45,307,230 45,833,763
Cash 1,999,741 2,752,859
Prepaid and other assets 1,672,429 610,462
Deferred costs, net of accumulated
amortization of $2,771,438 and $2,706,438, respectively 298,818 103,817
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Total Assets $ 49,278,218 $ 49,300,901
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LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Mortgage payable $ 37,987,431 $ 38,114,269
Accounts payable 203,782 280,465
Accrued expenses 894,088 375,194
Tenants' security deposits 161,219 159,161
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Total Liabilities 39,246,520 38,929,089
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Partners' Capital (Deficit)
Limited partners equity, 566 units
authorized and outstanding, 10,994,095 11,324,006
General partner's deficit (962,397) (952,194)
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Total Partners' Capital 10,031,698 10,371,812
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Total Liabilities and Partners' Capital $ 49,278,218 $ 49,300,901
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PART I - FINANCIAL INFORMATION
ITEM 1. - FINANCIAL STATEMENTS
STATEMENTS OF OPERATIONS
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For the Three Months Ended March 31, 1996 and 1995
(Unaudited) 1996 1995
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Income
Rental $ 2,425,975 $ 2,265,939
Interest on short-term investments 21,467 31,842
Other 247,811 218,102
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2,695,253 2,515,883
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Expenses
Leasing 88,768 103,777
General & administrative 53,727 54,292
Management Fees 144,464 138,892
Utilities 319,837 392,471
Repairs & Maintenance 224,340 261,041
Insurance 59,276 55,327
Taxes 182,326 225,720
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Total operating expenses 1,072,738 1,231,520
Other expenses
Depreciation 730,122 723,790
Amortization 65,000 51,911
Interest expense 946,898 994,004
Other expenses 220,609 19,526
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Total expenses 3,035,367 3,020,751
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Net loss $ (340,114) $ (504,868)
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Net loss allocated to General Partner $ (10,203) $ (15,146)
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Net loss allocated to Limited Partners $ (329,911) $ (489,722)
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Net loss per unit outstanding - Limited Partners $ (583) $ (865)
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Weighted average number of units outstanding 566 566
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STATEMENTS OF CASH FLOWS
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For the Three Months Ended
March 31, 1996 and 1995 (Unaudited) 1996 1995
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Cash flow from operating activities:
Net loss $ (340,114) $ (504,868)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation 730,122 723,790
Amortization 65,000 51,911
Changes in assets and liabilities:
Increase in prepaid and other assets (1,061,967) (289,196)
Increase (decrease) in accounts payable and accrued expenses 442,211 (71,874)
Increase (decrease) in tenants security deposits 2,058 (4,768)
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Net cash used in operating activities (162,690) (95,005)
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Cash flows from investing activities:
Acquisition of and improvements to property (203,589) (45,628)
Additions to deferred cost (260,001) -
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Net cash used in investing activities (463,590) (45,628)
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Cash flows from financing activities:
Principal payments on mortgage note (126,838) (115,524)
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Net cash used in financing activities (126,838) (115,524)
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Net decrease in cash (753,118) (256,157)
Cash, beginning of period 2,752,859 3,054,764
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Cash, ending $ 1,999,741 $ 2,798,607
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Supplemental disclosure of cash flow information:
Cash paid for interest $ 946,898 $ 968,814
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STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
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For the Three Months Ended General Limited
March 31, 1996 and 1995 Partners' Partners' Total
(Unaudited) Capital Capital Capital
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Balance, December 31, 1995 $ (952,194) $11,324,006 $10,371,812
Net loss (10,203) (329,911) (340,114)
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Balance, March 31, 1996 $ (962,397) $10,994,095 $10,031,698
=========== =========== ===========
Balance, December 31, 1994 $ (885,391) $13,483,971 $12,598,580
Net loss (15,146) (489,722) (504,868)
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Balance, March 31, 1995 $ (900,537) $12,994,249 $12,093,712
=========== =========== ===========
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996
(Unaudited)
1. ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed financial statements included herein have been prepared by the
Registrant, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. The Registrant's accounting and financial
reporting policies are in conformity 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 Registrant's latest annual report on Form 10-K.
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, 1996.
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 WFA a property management fee of $103,114
and $97,542 for the three months ended March 31, 1996 and 1995, respectively. An
Investor Service fee of $41,350 for the three months ended March 31, 1996 and
$41,350 for the three months ended March 31, 1995 was also paid to affiliate of
WFA. This fee increases annually by 6%.
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
theses expenses as well as to provide for cash distributions to its partners.
The Washington, D.C., area apartment market is stable but remains competitive.
The Partnership continues to make capital improvements to the property to
enhance its competitiveness within the local market. The Partnership spent
$203,589 on capital improvements during the first quarter of 1996 compared to
$45,628 in the first quarter of 1995. Improvements include balcony and deck
repairs, new machines in the fitness center, marble flooring in the hallways,
energy saving conversion to the plumbing and continuous renovating and upgrading
of apartment units. The capital improvements have been funded by a combination
of the property's reserves and cash flow from operations. As of March 31, 1996,
the Partnership had a cash balance of approximately $2.0 million, including
$565,538 that is being held by the lender to complete unit renovations.
The Property's Mortgage Loan is evidenced by a promissory note payable by the
Partnership to GMAC and secured by a mortgage in favor of GMAC on the Property
in the full amount of the Mortgage Loan. As of March 31, 1996, the remaining
blance of the Mortgage Loan was $37,987,431. The Mortgage Loan bears interest at
the rate of 9.9375%, requiring monthly payments of principal and interest
totaling $357,912. The Mortgage Loan matures in July 1996, at which time a
balloon payment of the remaining outstanding principal in the amount of
$37,810,866 balance will be due. The General Partner has actively sought
replacement financing for the Mortgage Loan, however, no commitment has been
received as of May, 1996. Although the General Partner is confident that the
Mortgage Loan can be replaced, if the Mortgage Loan is not extended or
refinanced or the Property not sold, the Property could be lost through mortgage
foreclosure.
Results of Operations
The Partnership's net loss declined from $504,868 for the three months ended
March 31, 1995 to $340,114 for the three months ended March 31, 1996. Excluding
non-cash 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, and pay down the loan encumbering the property.
The Partnership's revenue increased from $2,515,883 to $2,695,253 or by 7.1% for
the first quarter of 1996 compared to the first quarter of 1995. Rental Income
was 7.0% higher reflecting an increase average occupancy to 98% in the quarter
ended March 31, 1996 compared to 90% for the same quarter in 1995. The improved
occupancy was partially offset by a decrease in average rental charges from $692
per unit to $677 per unit in 1996.
The direct operating costs of the Partnership's property declined by 12.9% or
$158,782 from $1,231,520 for the quarter ended March 31, 1995 to $1,072,738 for
the March 31, 1996 quarter. The cost savings were primarily as a result of lower
leasing, utilities, and repairs and maintenance expenses, and a decrease in the
property's taxes.
The Partnership's depreciation and amortization expense categories were
consistent with the results for the same period in 1995.
Interest expense decreased from $954,004 for the quarter ended March 31, 1995 to
$946,898 for the quarter ended March 31, 1996 as a result of the lower debt
balance outstanding.
Other expenses increased from $19,526 to $220,609 in the first quarter of 1996
primarily as a result of approximately $180,000 of legal costs incurred related
to litigation initiated by the Partnership in connection with a third party
proxy solicitation.
The results of operations in future quarters may differ from the results of
operations for the quarter ended March 31, 1996, due to inflation and changing
economic conditions which could affect occupancy levels, rental rates and
operating expenses.
PART II - OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
No report on Form 8-K was required to be filed during the period.
SIGNATURE
Pursuant to the requirements of the Securities and 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
By: /s/ Michael L. Ashner
Michael L. Ashner
Chief Executive Officer
By: /s/ Edward V. Williams
Edward V. Williams
Chief Financial Officer