Exhibit 99.(a)(2)
EQUITY RESOURCE LEXINGTON FUND
14 Story Street
Cambridge, MA 02138
June 7, 2001
OFFER TO PURCHASE UNITS IN
URBAN IMPROVEMENT FUND LIMITED 1973
FOR $200 PER UNIT
Dear Limited Partner:
Enclosed with this letter is an offer from Equity Resource Lexington Fund (the
"Lexington Fund" or "Purchaser") to purchase limited partnership units in Urban
Improvement Fund Limited 1973 (the "Partnership") for $200 per unit [See "THE
OFFER--Introduction"]. This offer expires on July 5, 2001. If you are interested
in selling your units, please read the enclosed offer carefully.
The Partnership currently holds limited partnership interests in thirteen
limited partnerships (the "Local Partnerships"). The majority of these Local
Partnerships own low-income housing projects that are subject to government
regulations limiting the amount of money that the Local Partnerships can
distribute to the Partnership. Government regulations also limit the properties'
rent levels and may limit the Local Partnerships' ability to refinance or sell
these properties. [See "THE OFFER--Section 10--Certain Information Concerning
the Partnership "].
BENEFITS OF A SALE
o The Partnership's most recently filed 10-K annual report indicated that
the Partnership generated taxable income of $405 per unit for the
year-ended December 31, 1999, resulting in substantial tax liability
for limited partners. Limited partners who sell their units will
terminate their investment in the Partnership and eliminate future tax
liability associated with the ownership of their units. Please see "THE
OFFER--Section 6--Certain Tax Consequences" for further information
regarding the tax consequences of a sale of your units.
o The Lexington Fund's offer provides liquidity to limited partners and
will give them an opportunity to liquidate this investment. The
Partnership has been in existence for over 25 years and the Purchaser
anticipates that it will continue to operate for the foreseeable
future. By selling your limited partnership units, you give yourself
the opportunity to place the proceeds from a sale into other,
potentially better performing, investments. You may also simplify your
tax returns by eliminating future K-1 reporting for this Partnership.
o Limited partnership units are illiquid investments. When you consider
the illiquid secondary market (which is essentially nothing more than a
"matching service" that attempts to bring buyers and sellers together),
the cost of selling commissions, your annual cost of tax reporting, and
the cost of a trustee if Units are held in an IRA or pension plan, the
sale of your Units for cash may be a good choice for you.
RISKS OF A SALE
o No independent party has been retained by Lexington Fund or any other
person to evaluate or render any opinion to Limited Partners with
respect to the fairness of the Offer Price, and no representation is
made as to any fairness or other measures of value that may be relevant
to Limited Partners. In making the Offer, Lexington Fund has not based
its valuation of the properties owned by the Partnership on any
third-party
appraisal or valuation and it is uncertain whether the Offer Price
reflects the value that would be realized upon the sale of Units by a
Limited Partner to a third party. We urge Limited Partners to consult
their own financial and tax advisors in connection with the Offer.
o Lexington Fund is making the Offer with a view toward making a profit.
Accordingly, there is a conflict between Lexington Fund's desire to
acquire your Units at a low price and your desire to sell your Units at
a high price. Lexington Fund's intent is to acquire the Units at a
discount to the value Lexington Fund might ultimately realize from
owning the Units. Although Lexington Fund cannot predict the future
value of the Partnership assets on a per Unit basis, the Offer Price
could differ significantly from the net proceeds that could be realized
from a current sale of the properties owned by the Partnership or that
may be realized upon future liquidation of the Partnership.
o Limited Partners who sell their Units will be giving up the opportunity
to participate in any future potential benefits associated with
ownership of Units, including the right to participate in any future
distribution of cash or property.
THE PURCHASER
The Lexington Fund is in the business of acquiring fractional investment
interests for long-term retention and seeks to purchase Units in the Partnership
in advancement of that strategy. The Units acquired as a result of this offer
will be held as long-term investments and not with a view to a resale. The
Lexington Fund does not acquire General Partner positions and is not engaged in
property management.
Please read the enclosed offer carefully. It contains important information
concerning this offer, the Partnership and the Purchaser. If you wish to sell
your units, complete the enclosed Agreement of Sale according to the directions
on the back of the agreement, sign where indicated and return it in the
pre-addressed return envelope.
If you have any questions regarding this offer, please call Equity Resources
Group, Inc., the information agent for this offer, at (617) 876-4800, or e-mail
them at info@equityresources.com.
Sincerely,
Equity Resource Lexington Fund LP