UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) March 7, 2003
___AEI REAL ESTATE FUND XVI LIMITED PARTNERSHIP___
(Exact Name of Registrant as Specified in its Charter)
__________________State of Minnesota_______________
(State or other Jurisdiction of Incorporation or Organization)
______0-16555_________ _____41-1571166_____
(Commission File Number) (I.R.S. Employer
Identification No.)
_____1300 Minnesota World Trade Center, St. Paul, Minnesota 55101_____
(Address of Principal Executive Offices)
_______________(651) 227-7333_______________
(Registrant's telephone number, including area code)
___________________________________________________________
(Former name or former address, if changed since last report)
Item 2. Acquisition or Disposition of Assets.
On March 7, 2003, the Partnership sold two JEMCARE
daycare centers in Arlington, Texas to the lessee. The
Partnership received net proceeds of approximately $486,000,
which resulted in a net gain of approximately $-0-.
In the fourth quarter of 2002, a charge to operations for
real estate impairment of $246,388 was recognized for the
properties, which was the difference between book value at
December 31, 2002 of $732,388 and the estimated net sale
proceeds of $486,000.
Item 7. Financial Statements and Exhibits.
(a)A limited number of proforma adjustments are
required to illustrate the effects of the
transaction on the balance sheet and income
statement. The following narrative description
is furnished in lieu of the proforma statements:
Assuming the Partnership had sold the properties
on January 1, 2001, the Partnership's Investments
in Real Estate would have been reduced by
$767,219 and its Current Assets (cash) would have
increased by $486,000 and Partner's Capital would
have decreased by $281,219.
The Total Income for the Partnership would have
decreased from $558,453 to $465,164 for the year
ended December 31, 2001 and from $364,172 to
$294,205 for the nine months ended September 30,
2002 if the Partnership had not owned the
properties during the periods.
Depreciation Expense would have decreased by
$17,415 and $13,061 for the year ended December
31, 2001 and the nine months ended September 30,
2002, respectively.
Partnership Administration and Property
Management Expense would have decreased by $1,377
and $1,329 for the year ended December 31, 2001
and the nine months ended September 30, 2002,
respectively.
The net effect of these proforma adjustments
would have caused Net Income to decrease from
$101,330 to $26,833 and from $52,373 to $(3,204),
which would have resulted in Net Income (Loss) of
$1.99 and $(0.24) per Limited Partnership Unit
outstanding for the year ended December 31, 2001
and the nine months ended September 30, 2002,
respectively.
(b) Exhibits
Exhibit 10.1 - Purchase Agreement
dated February 1, 2003 between the
Partnership and Jem Care, Inc.
relating to the property at 5900
Matlock Avenue, Arlington, Texas.
Exhibit 10.2 - Purchase
Agreement dated February 1, 2003
between the Partnership and Jem Care,
Inc. relating to the property at 1951
E. Arkansas Lane, Arlington, Texas.
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 hereunto duly
authorized.
AEI REAL ESTATE FUND XVI
LIMITED PARTNERSHIP
By: AEI Fund Management XVI, Inc.
Its: Managing General Partner
Date: March 8, 2003 /s/ Patrick W. Keene
By: Patrick W. Keene
Its: Chief Financial Officer