EXHIBIT (a)(9)
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Letter to Brokers
BERKSHIRE INCOME REALTY, INC.
One Beacon Street, Suite 1500
Boston, Massachusetts 02108
January 24, 2003
Dear Registered Representative:
We are writing to tell you about an investment opportunity that is being offered
to your clients that are Krupp mortgage fund investors. It is an opportunity for
them to exchange their mortgage fund interests for preferred stock of Berkshire
Income Realty, Inc. (BIR), a newly formed REIT that is controlled by Douglas
Krupp, Chairman and Chief Executive Officer of The Berkshire Group, and George
Krupp, Vice Chairman of The Berkshire Group.
The exchange offer is being made only to Krupp mortgage fund investors, and
provides them with an opportunity to exchange their interests in their Krupp
mortgage fund for Berkshire Income Realty's shares of 9% Series A Cumulative
Redeemable Preferred Stock, which will be listed on the American Stock Exchange
under the symbol "BIR."
As anticipated, the Krupp mortgage funds have experienced significant payoffs of
their mortgage loan investments. Since the mortgage funds are not permitted to
reinvest the funds they receive from repayments of the mortgage loan assets, but
instead must distribute the net cash proceeds attributable to these repayments
to the fund investors, this results in ever-decreasing levels of regular
distributions to the fund investors. In order to provide an alternative ongoing
investment vehicle, we have developed a new investment program in Berkshire
Realty Income that offers the following advantages:
o Issuance of 9% Series A Cumulative Redeemable Preferred Stock,
with dividends paid quarterly.
o Listing of the Preferred Stock on the American Stock Exchange
to provide investors with liquidity.
o No cost to the investors to effect the exchange from their
mortgage fund shares to Berkshire Income Realty's Preferred
Stock.
Berkshire Income Realty is a newly formed REIT whose objective is to acquire,
own and operate multi-family residential properties. In making this offer, we
are seeking to provide investors with an opportunity to exchange all or part of
the interests in their mortgage fund for a preferred security in a newly
organized REIT. This preferred security will be issued by us, a REIT having
substantially different assets, objectives, and ownership structure from the
mortgage funds. The dividend, liquidation rights and trading liquidity will also
be substantially different from those of the interests in the mortgage funds.
Investors will not be required to pay any commissions or transfer fees in
connection with the exchange of their mortgage fund investment for our 9% Series
A Cumulative Redeemable Preferred Stock. If they choose not to participate, they
will remain a unitholder in their mortgage fund. The exchange offer is scheduled
to expire at 5:00 p.m., New York City time, on February 20, 2003, unless
extended.
For your information, we have enclosed a brochure highlighting the terms of this
offer. The prospectus is available on our website at www.kruppfunds.com. If your
clients need additional copies of the prospectus or letter of transmittal,
copies may be obtained from us, at our expense, by calling us at the number
below.
The offer is scheduled to close in the first quarter of 2003, at which time it
is expected that our 9% Series A Cumulative Redeemable Preferred Stock will be
trading on the American Stock Exchange. You may also want to consider this
investment for your other clients at that time.
Should you have any questions, please contact us at 1-866-335-7877 and we will
be happy to assist you.
Very truly yours,
BERKSHIRE INCOME REALTY, INC.