Company: NEN
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001104659-25-108441
Chunk: 2

Company: NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 3
Chunk 2
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the exposure to loss resulting from changes in interest rates and equity prices. In pursuing its business plan, the primary market risk to which the Partnership is exposed is interest rate risk. Changes in the general level of interest rates prevailing in the financial markets may affect the spread between the Partnership’s yield on invested assets and cost of funds and, in turn, its ability to make distributions or payments to its investors.

As of September 30, 2025, the Partnership, its Subsidiary Partnerships and the Investment Properties collectively have approximately $689,037,000 in long-term debt, approximately 90% of which require payment of interest at fixed rates. Accordingly, the fair value of these debt instruments is affected by changes in market interest rates. This long term debt matures through 2035. The Partnership, its Subsidiary Partnerships and the Investment Properties collectively have variable rate debt of $67,500,000 (without taking out unamortized deferred financing costs) as of September 30, 2025. Interest rates ranged from SOFR plus 150 basis points to SOFR plus 250 basis points. Assuming interest-rate caps are not in effect, if market rates of interest on the Partnership’s variable rate debt increased or decreased by 100 basis points, then the increase or decrease in interest costs on the Partnership’s variable rate debt would be approximately $675,000 annually and the increase or decrease in the fair value of the Partnership’s fixed rate debt as of September 30, 2025 would be approximately $23,300,000. For information regarding the fair value and maturity dates of these debt obligations, See Note 5 to the Consolidated Financial Statements — “Mortgage Notes Payable,” Note 12 to the Consolidated Financial Statements — “Fair Value Measurements” and Note 15 to the Consolidated Financial Statements — “Investment in Unconsolidated Joint Ventures”. 

For additional disclosure about market risk, see “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Factors That May Affect Future Results”

ITEM 4. CONTROLS AND PROCEDURES   

Disclosure Controls and Procedures.  The Partnership’s management, with the participation of the Partnership’s principal executive officer and principal financial officer, has evaluated the effectiveness of the Partnership’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e)