**FORM 10-QSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.  20549**

** **

(Mark One)   X      

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)OF THE SECURITIES EXCHANGE ACTOF 1934

For the quarterly period endedOctober 31, 2004                                                              

OR

______

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)   OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition periodfrom ___________to _________________________________________Commission file number __________________________________________________________

First Hartford Corporation and Subsidiaries(Address of principal executive offices)(Zip Codes)

(860) 646-6555(Registrant's telephone number, including area code)

  N/A    (Former name, former address and former fiscal year,if changed since last report)

Indicate by check mark whether the Company (1) has filedall reports required to be filed by Section 13 or 15 (d) of the SecuritiesExchange Act of 1934 during the preceding 12 months, and (2) has been subjectto such filing requirements for the past 90 days.Yes   x                         No___Amendment_____________________________________________________________________

Amended effective November15, 2002; compliance and phase-in details in Release No. 33-8128 (¶ 86,724), 67 F.R. 58480Indicate by check markwhether the registrant is an accelerated filer (as defined in Rule 12b-2 of theExchange Act):Yes                  No  x   End of Amendment_______________________________________________________________

Indicate by check markwhether the registrant has filed all documents and reports required to be filedby Sections 12,13 or 15 (d) of the Securities Exchange Act of 1934 subsequentto the distribution of securities under a plan confirmed by a court.Yes   x             No____

APPLICABLE ONLY TO CORPORATE ISSUERS:

            Indicate the number of shares outstanding ofeach of the issuer's classes of common stock, as of the latest practicabledate.  3,089,648 shares of common stock as of October 31, 2004.

| 1 |
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**FIRST HARTFORD CORPORATION AND SUBSIDIARIES**

**INDEX**

| **PART I.**
**                     FINANCIAL INFORMATION                                **
**PAGE**   Item 1.FinancialStatements     ConsolidatedBalance Sheets -       October31, 2004 (unaudited) and April 30, 2004 (audited) 3 & 4    ConsolidatedStatements of Operations and Comprehensive Loss       Forthe Three Months and Six Months       EndedOctober 31, 2004 and 2003 (unaudited)   5    ConsolidatedStatements of Cash Flows       Forthe Three Months and Six Months       EndedOctober 31, 2004 and 2003 (unaudited) 6-7    Notes to			Consolidated Financial Statements     			8-10   Item 2.			Management's Discussion and Analysis           			11 - 13   Item 3.Quantitativeand Qualitative Disclosures       About Market Risk       			13   Item 4.Controls			and Procedures  14   **PART II****OTHERINFORMATION**    Item 1.			Legal Proceedings    15   Item 2.Changesin Securities, use of Proceeds And Issuer Purchases of  Equity Securities     			15   Item 3.			Defaults Upon Senior Executives   15   Item 4. 			Submission of Matters to a Vote Of Security Holders   			16   Item 5.			Other Information16   Item 6.			Exhibits and Reports on Form 8-K       			16-18    Signatures  17,18
2
 
 

**PART I.          FINANCIAL INFORMATION**

** **

**FIRST HARTFORD CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS**

**ASSETS**
   
**October 31, 2004**
**April 30, 2004**   
(unaudited)   

(audited)   

 
Real Estate and equipment:
Developed properties
$25,667,762

$24,274,133

Equipment and leasehold improvements
161,439

120,931

 
25,829,201

24,395,064

       
Less accumulated depreciation
2,258,616

1,933,189

 
23,570,585

22,461,875

 
Properties under construction
2,742,521

          0

 
26,313,106

22,461,875

 
Cash
489,445

1,500,030

 
Investment in marketable securities
536,713

676,680

 
Accounts and notes receivable, less allowance for  doubtful accounts of $31,600 in October 31 and April 30, 2004
337,568

911,901

 
Deposits, escrows and prepaid and deferred expenses
3,138,696

2,489,014

 
Investment in affiliates
354,110

239,519

 
Due from related parties and affiliates
662,612

966,105

       
Deferred tax assets (net of valuation allowance of  $1,350,000 in October 31 and April 30, 2004).
900,000

900,000

 
$32,732,250

$30,145,124

** **

The accompanyingnotes are an integral part of these consolidated financial statements

3

**PART I - FINANCIAL INFORMATIONFIRST HARTFORD CORPORATION AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS**

**Liabilities and Shareholders Deficit**
**October 31, 2004**
**April 30, 2004**

**Liabilities:**

(unaudited)    

(audited)    

** **

Mortgages, notes  payable;

     Construction loans

$0

$5,563,476

     Mortgages payable

30,402,963

21,053,453

     Notes payable - other

1,444,613

1,586,601

31,847,576

28,203,530

     Accounts payable

1,288,067

1,737,212

     Accrued liabilities

337,650

571,828

     Accrued cost of  derivatives

0

179,059

     Minority interest

(70,000)

19,179

     Deferred income

238,301

78,654

     Other liabilities

575,152

560,998

     Due to related parties  and affiliated

83,428

95,786

34,300,174

31,446,246

** **

**Shareholder's Equity  (deficiency):**

** **

**    **Common Stock, $1 par; authorized 6,000,000		      Shares; issued 3,322,213 shares

3,322,213

3,322,213

**    **Capital in excess of par

5,182,645

5,182,645

     Deficit

(7,775,784)

(7,450,371)

     Unearned stock  compensation

(209,896)

(291,146)

     Accumulated  comprehensive income

(18,144)

3,661

** **

501,034

767,002

** **

     Less 232,565 shares at  October 31, 2004 and 	     232,228 shares at  April 30, 2004 of common 	     stock held in  Treasury, at cost.

2,068,958

2,068,124

(1,567,924)

(1,301,122)

$32,732,250

$30,145,124

The accompanying notes are an integral part of theseconsolidated financial statements

4

 

 

 

 

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS ANDCOMPREHENSIVE LOSS**(Unaudited)

**                                                                                                                    **
            **Three Months Ended             ****Six Months Ended****October 31, 2004  October 31, 2003**
**October 31, 2004  October 31, 2003      **   
**(Restated)**   
**(Restated)**
**Revenues:**

** **

** **

Sale of  real estate

$0 

$73,096 

$128,500 

$73,096 

Construction

29,958 

17,655 

127,847 

104,947 

Rental  income

1,174,741 

398,193 

2,255,635 

762,121 

Gain on  derivatives

0 

0 

29,059 

0 

Other/Service  Income

305,745 

38,790 

416,626 

135,218 

Equity/loss  in earnings of affiliates

84,514 

111,731 

195,621 

218,462 

Non-recurring  items

             0	

133,146 

              0	

133,146 

1,594,958 

772,611 

3,153,288 

1,426,990 

**Cost  and Expenses:**

Cost of  sales, real estate

0 

15,771 

15,304 

15,771 

Construction

24,194 

15,332 

30,939 

21,376 

Operating

425,395 

205,011 

777,330 

423,595 

Interest

365,111 

186,115 

695,883 

378,714 

Loss on derivatives

0 

0 

Depreciation  and amortization

205,999 

58,049 

408,206 

115,776 

General  and administrative

548,576 

374,127 

1,043,250 

794,518 

Property  taxes

180,666 

34,911 

337,722 

72,906 

1,749,941

889,316

3,308,634

1,822,656 

Loss  before discontinued operation

(154,983)

(116,705)

(155,346)

(395,666)

**Discontinued  Operation:**

Gain on  operations of shopping center sold

             0	

123,452 

              0	

169,368 
   
Net  income (loss) before income tax

(154,983)

6,747 

(155,346)

(226,298)
   
State  income tax provision

4,000 

               0	

8,995 

4,151 
                                 
Net  income (loss) before minority interest

(158,983)

6,747 

(164,341)

(230,449)
     
Minority  interest

(74,381)

0 

(161,071)

0

Net  income (loss)

(233,364)

6,747 

(325,412)

(230,449)

Other  comprehensive loss, net of taxes

             0	

             0	

(21,805)

               0

Net  income (loss)

(233,364)

6,747 

(347,217)

(230,449)

Net  income (Loss) per Share

(0.08)

0.00 

(0.11)

(0.07)

Weighted  Average Number of Shares Outstanding

3,089,648 

3,089,985 

3,089,816 

3,089,985 

The accompanying notes are an integral part of theseconsolidated financial statements

5

 

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE THREE MONTHS AND SIX MONTHS ENDED OCTOBER 31, 2004 AND 2003**

**                                                                                                           **
                  **Three Months Ended**
**SixMonths Ended**   **October 31, 2004  October 31, 2003****October 31, 2004  October 31, 2003**      **(Restated)**   **(Restated)**
Cash Flows from operating  activites:

Net Profit (loss)

($233,364)

   $6,747

($325,412)

$(230,449)

Adjustments to reconcile  net loss to net cash used in operating activities:

     Gain on sale of  property

0

(57,325)

              0

(57,325)

     Depreciation

     158,842

 119,446

    325,427

   236,401

     Amortization

      47,157

   12,222

      82,779

    24,194

     Adjustment of  potential cost of derivatives

 (150,000)

           0

(179,059)

             0

     Amortized unearned  stock compensation

      40,625

           0

     81,250

             0
              
Changes in assets and  liabilities:
            
     (Increase) decrease  in:
            
     Accounts and notes  receivable, net

     135,845

 405,934

   574,333

       4,539

     Deposits, escrows,  prepaid and deferred 	     expense

(1,289,152)

(225,978)

(732,461)

(398,653)

Increase (decrease) in:

     Accrued liabilities

(379,160)

(45,726)

(234,179)

(128,970)

     Undistributed Minority  Interest

(105,619)

            0

(89,179)

             0

     Other liabilities

      36,827

(18,176)

      14,154

     36,064

     Deferred Income

      40,356

            0

   159,647

              0

     Accounts payable

    377,577

(7,487)

(449,145)

   450,779

Net cash used in operating  activities

(1,320,066)

 189,657

(771,845)

    (63,420)
  
Cash flows from investing  activities:

     Investment in  affiliates

(47,733)

     42,769

(114,591)

   770,939

     Investment in  Marketable Securities

(73,039)

             0

   118,162

             0

     Purchase of equipment  and leasehold 	     improvements

(7,556)

(1,559)

(40,508)

(4,022)

Payments for:

     Treasury Stock

(834)

            0

(834)

             0

     Additions to  properties under construction

(2,253,795)

     6,726

(4,136,150)

(42,371)

Net cash used in investing  activities

(2,382,957)

   47,936

(4,173,921)

   724,546
  
Cash flows from financing  activities:

     Proceeds from:

     Construction loan  payable

   1,033,586

 261,596

2,342,024

445,134

     Mortgage payable

 14,850,000

           0

14,850,000

0
  
Principal payments on:

     Construction loan  payables

(7,905,500)

            0

(7,905,500)

0

     Mortgage payable

(5,287,015)

(240,577)

(5,500,490)

(571,167)

     Notes payable

(77,719)

(239,022)

(141,988)

(330,465)

Gross proceeds on sale of  real estate

              0

   73,096

             0

    73,096

The accompanyingnotes are an integral part of these consolidated financial statements

6

 

 

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE THREE MONTHS AND SIX MONTHS ENDED OCTOBER 31, 2004 AND 2003(continued)**

 
   **Three Months Ended**
**SixMonths Ended**   **October 31, 2004  October 31, 2003****October 31, 2004  October 31, 2003**      **(Restated)**   **(Restated)**               
Advance from/repayment to  related parties and affiliated partnerships

    203,288

 (106,924)

    291,135

(302,140)

Net cash provided by  financing activities

 2,816,640

(251,831)

 3,935,181

(685,542)

Net decrease in cash and  cash equivalent

(886,383)

(14,238)

(1,010,585)

(24,416)

Cash and cash equivalents,  beginning of period

1,375,828

      18,873

1,500,030

    29,051

Cash and cash equivalents  at end of period 
 $489,445      $4,635 $489,445   $4,635
 

 

 

 

 

The accompanying notes are an integral part of theseconsolidated financial statements

7
 
 

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

** ****Note 1: Summary of Significant Account Policies**

Description of Business

First Hartford Corporationand subsidiaries (the "Company") was incorporated in Maine in 1909, and isengaged in the purchase, development, ownership, management and sale of realestate.

Principles ofConsolidation

The accompanying financialstatements include the accounts of the Company, and its wholly ownedsubsidiaries.  All significant intercompany transactions and accounts have beeneliminated in the consolidated financial statements, including constructionrevenues and costs of development for the Company's own use (rental/futuresale).  Construction revenue from contracts between the Company and itsinvestment partnerships are shown net of the related construction costs.

Financial StatementPresentation

Because the Company isengaged in the development and sale of real estate in various states ofconstruction, the operating cycle may extend beyond one year.  Accordingly,following the usual practice of the real estate industry, the accompanyingconsolidated balance sheets are unclassified.

ConstructionRevenue

Sincethe Company is primarily involved in the development of property for its ownuse, construction revenue is recorded upon the sale of a property built forthird parties.  Revenues from projects built for third parties are recognizedon the percentage-of-completion method of accounting, based on costs incurredto date in relation to total actual costs and estimated costs to complete.  Revisionsin costs and profit estimates are reflected in operations during the period inwhich the facts become known.  The Company provides for estimated losses oncontracts in the period such losses become known.  There were no propertiesbuilt for sale to third parties during the period covered by this report.

Asubsidiary, Lead Tech, Inc., does lead and asbestos inspections and remediationand recognizes revenue as services are provided.

RentalRevenue - Rental revenue is comprised of base rent, reimbursements for certaincosts as provided in the lease agreements such as real estate taxes, utilities,insurance, common area maintenance charges and other recoverable costs.  Thereare no contingent rents during the period covered by this report.  

TheCompany leases certain real estate to tenants under leases that may includerenewal options.  In most cases, management expects that in the normal courseof business, leases will be renewed.  Therefore, in accordance with Statementof Financial Accounting Standards No. 13 "Accounting for Leases", rentalrevenue is recognized on a straight-line basis over the terms of the respective leases.

8

 

 
****
 

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**Off Balance Sheet Risk:**

Duringthe reporting period, the Company had an amount in excess of $100,000 in asingle bank.  Amounts over $100,000 are not insured by the Federal DepositInsurance Corporation.  These balances fluctuate during the year and willusually exceed this $100,000 limit. Management regularly monitors the financialinstitution, together with its cash balances, and seeks to minimize thispotential risk.  

TheCompany maintains an account with a brokerage firm which had an amount greaterthan $500,000.  Amounts over $500,000 are not insured by the SecuritiesInvestor Protection Corporation.  Management regularly monitors the financialinstitution, together with its balances, and seeks to minimize this potentialrisk.  

**Investment InAffiliated Partnerships**

Inaccordance with ARB51, investments in entities in which the Company owns lessthan a 20% interest are carried at cost.  Distributions incurred from thoseentities are included in income.  Investments in entities in which the Companyhas a 20-50% interest are carried at cost adjusted for the Company'sproportionate share of their undistributed earnings or losses.  Distributionsreceived in excess of the Company's proportionate share of capital are appliedas a reduction of the cost of the investment.  

TheCompany currently has two unconsolidated operating partnerships:  The ShoppingCenter in Cranston, RI in which the Company owns a 25% interest and theShopping Center in Dover Township, NJ in which the Company owns a 50%interest.  Although the Company exercises significant influence, the Companydoes not control the operating and financial policies of these partnershipsand, therefore, are not consolidated in the financial statements.  Theseinvestments were recorded at cost and subsequently adjusted for gains, losses anddistributions.  If the carrying value of the investment is less than zero, theamount is recorded in other liabilities.

**Fair Value ofDerivative Instruments**

Inthe normal course of business, the Company is exposed to the effects ofinterest rate changes.  The Company limits its exposure with the use ofderivatives.  To mitigate the exposure to unexpected changes in interest rates,derivatives are used primarily to hedge against rate movements on some of theCompany's related debt.  Interest rate swap contracts that have been designatedand qualify as fair value hedging instruments are reported at fair value.  Thegain or loss on the derivative instrument as well as the offsetting gain orloss on the hedged item attributable to the hedged risk are recognized inearnings in the current period.

**Accounting For TheImpairment Or Disposal of Long-Lived Assets**

TheCompany has adopted Statement of Financial Accounting Standards (SFAS) No. 144,"Accounting for the Impairment or Disposal of Long-Lived Assets", whichestablished a single accounting model for the impairment or disposal oflong-lived assets including discontinued operations.  SFAS No. 144 requiresthat the operations related to properties that have been sold or propertiesthat are intended to be sold be presented as discontinued operations in theConsolidated Statement of Operations and Comprehensive Loss for all periodspresented, and properties intended to be sold to be designated as "held forsale" on the Consolidated Balance Sheet.

9

 

 

 

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**Estimates**

Thepreparation of financial statements in conformity with accounting principlesgenerally accepted in the United States of America requires management to makeestimates and assumptions that affect the reported amount of assets andliabilities, and the disclosure of contingent assets and liabilities as of thedate of the financial statements, and the reported amounts of revenues andexpenses during the reporting period.  Actual results could differ from thoseestimates.

**Marketable Securities**

Inaccordance with SFAS No. 115 "Accounting for Certain Investments in Debt andEquity Securities" the Company determines the appropriate classification of itsinvestments in debt and equity securities at the time of purchase andre-evaluates such determination at each Balance Sheet date.  Debt securitiesfor which the Company does not have the intent to hold to maturity areclassified as available-for-sale, along with the Company's investment in equitysecurities.  Securities available-for-sale are carried at fair value, with theunrealized gains and losses reported in other comprehensive income (loss).

** **

**Stock Compensation**

TheCompany applies Accounting Principles Board Opinion 25, "Accounting for StockIssued to Employees" ("APB 25") and related interpretations in accounting forits stock awards, and complies with the disclosure provisions of SFAS No. 123,"Accounting for Stock Based Compensation".  Under APB 25, compensation expenseis recognized over the vesting period to the extent that the fair market valueof the underlying common stock on the measurement date exceeds the exerciseprice of the employee stock award.  

**Accounting Change**

TheCompany has adopted SFAS No. 144 "Accounting for the Impairment or Disposal ofLong-Lived Assets".  As a result, there is a requirement to restate the 2003financial statements to properly present discontinued operations.  There is noeffect to net income.

Inthe current year, in accordance with SFAS No. 13 "Accounting for Leases"; theCompany recognized lease rental revenue on a straight-line basis over the termsof the respective leases.  For the quarter ended October 31, 2003 the financialstatements have been restated to reflect an increase of $10,071 to rentalearnings.

**Note 2.  Employee StockOption Plan:**

On January 22, 2004, theshareholders approved a stock-option plan.  In February 2004, 250,000 optionswere granted to five employees, two of which are directors.  The options have atwo-year vesting period which were granted at $1.10 per share, representing thehighest bid price prior to the issuance of the options. The option gives theemployee the right to sell the shares back to the Company for $2.40 at the endof the vesting period.  The Company expensed $40,625 related to the options forthe quarter and $81,250 for the six months ended October 31, 2004.

10

 

** **

** **

**Item 2.           FIRST HARTFORD CORPORATION ANDSUBSIDIARIES                        MANAGEMENT'SDISCUSSION AND ANALYSIS OF FINANCIAL                        CONDITIONAND RESULTS OF OPERATIONS**

The financial and businessanalysis below provides information which the Company believes is relevant toan assessment and understanding of the Company's consolidated financialposition and results of operations.  This financial and business analysisshould be read in conjunction with the consolidated financial statements andrelated notes.

The following discussion and certain other sections ofthis Report on Form 10-Q contain statements reflecting the Company's viewsabout its future performance and constitute "forward-looking statements" underthe Private Securities Litigation Reform Act of 1995.  These views may involverisks and uncertainties that are difficult to predict and may cause theCompany's actual results to differ materially from the results discussed insuch forward-looking statements.  Readers should consider how various factorsincluding changes in general economic conditions, cost of materials, interestrates and availability of funds, and the nature of competition and relationshipswith key customers may affect the Company's performance.  The Companyundertakes no obligation to update publicly any forward-looking statements,whether as a result of new information, future events or other.

**Critical Accounting Policies**

Thediscussion and analysis of financial condition and results of operations isbased upon the Consolidated Financial Statements contained in Item 1 in thisQuarterly Report.  The Consolidated Financial Statements include the accountsof the Company and its controlled affiliates.  The preparation of financialstatements in conformity with accounting principles generally accepted in theUnited States of America requires management to make estimates and assumptionsthat affect the reported amounts of assets and liabilities and the disclosureof contingent assets and liabilities as of the date of the financial statementsand the reported amounts of revenues and expenses for the reporting period. Actual results could differ from those estimates.

The estimates used in the preparation of the ConsolidatedFinancial Statements are described in Note 1 to the Consolidated FinancialStatements for the periods ended October 31, 2004 and 2003.  Certainsignificant accounting policies are considered critical accounting policies dueto the increased level of assumptions used or estimates made in determiningtheir impact on the Consolidated Financial Statements.  Management has reviewedthe critical accounting policies and estimates with the Company's Board ofDirectors.

 

 

11

 

** **

** **

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESMANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF OPERATIONS**

**Results of Operations**

The current quarter resulted in a loss of $233,364compared to income of $6,747 for the quarter ended October 31, 2003.  Thequarter in 2003 was aided by non-recurring income of $133,146 and operationsfrom a shopping center sold in February 2004 of $123,452.

Rental income has increased $776,548 and $1,493,514 forthe three and six month periods ended October 31, 2004.  The increase in rentalincome is reflective of rents, real estate taxes, insurance and common areacharges for Gibbs College and the West Springfield shopping center, neither ofwhich had any revenue prior to October 31, 2003.  The West Springfield shoppingcenter was fully occupied by October 31, 2004

Service income includes approximately $286,000 and$356,000 for the three and six months ended October 31, 2004.  The WestSpringfield shopping center was charged $70,000 for the three months and $185,000for the six months ended October 31, 2004 and is completed.  The Bangorshopping center was started approximately August 1, 2004 and was charged$171,000 for the three months ended October 31, 2004.  Service income representallocations of salary and associated costs representing an estimate of work forthe Bangor and West Springfield projects.  These costs are in operating as wellas general and administrative cost.

Due to a lawsuit filed by a dissident shareholder theCompany has suffered legal costs of $59,000 and $109,000 for the three and sixmonths ended October 31, 2004.

The current quarter and the quarter ended July 31, 2004have each been charged $40,625 for expensing of employee stock options. 

**Capital Resources and Liquidity**

Asreported in Form 8-K filed on August 9, 2004, the Company has startedconstruction of a new 233,000 s.f. shopping center in Bangor, Maine.  Theconstruction loan of $19,350,000 is expected to close approximately December17, 2004.  The Company has paid approximately $3,500,000 of cost on thisproject.  The Company has drawn down $700,000 of a $750,000 credit line toaccomplish this but expects to pay it back from the first construction costrequisition.

 Asreported in Form 8-K filed on October 12, 2004, the Company completed arefinancing of a mortgage for the West Springfield shopping center.  TheCompany paid $940,000 to cancel the original agreement with the Mortgagee. This amount was added to the cost of the project.

12

 

** **

** **

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESMANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF OPERATIONS**

** **

Thefollowing schedule outlines our long-term obligations as of October 31, 2004.

**Contractual  Obligations**

 

**Total**
**Less Than1 Year**
 

**1 - 3 Years**

 

**3-5 Years**
**More Than5 Years**
Long Term Debt

 31,651,620

 4,369,357

 2,067,008

11,150,125

14,065,130

Operating Lease

       120,000 (1)

    110,000

     110,000

Purchase Obligation

    7,824,509 (2)

  7,824,509

__________

__________

___________

$39,596,129

$12,303,866

$2,177,008

$11,150,125

$14,065,130

(1)       Shopping center in Bangor, Maineto be built on property leased until January 31, 2104.  Only payments prior toFebruary 1, 2006 are on this schedule.  Thereafter, the annual rent is $400,000with a .075% increase every 5 years.

(2)       The entire amount of purchaseobligations is for the Bangor project.

Although wary of rising interest rates, the possibilitiesof problems with major tenants, and major construction cost overruns, we feelour liquidity and capital resources are adequate to meet our needs.

**Item 3.           QUANTITATIVEAND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.**

Allphases of the real estate business are inherently speculative and intenselycompetitive with many enterprises, both large and small, engaged in businessessimilar to the Company's throughout the United States.  The success of theCompany, to a large extent, depends upon factors which may be beyond thecontrol of management.  Some of these factors are variable construction costs,the mortgage market, real estate taxes, income tax laws, governmentregulations, the commercial rental market and the economy.  The ability of theCompany to meet its debt service obligations and to operate profitably is alsodependent on its ability to attract tenants and to compete successfully withthe numerous other commercial properties available to prospective tenants.  Theability to attract tenants is dependent upon the changing character of theareas in which the Company's properties are located, the rate of new constructionin those areas and the extent of present and future competition in thoseareas.  The Company's holdings are becoming less diversified bothgeographically and in use and types of occupancy.

TheCompany's assets are concentrated mostly in the Northeast which creates ageographic diversification risk.  The Company presently has properties fromSouthern New Jersey and options for property as far north as Maine.

Thereal estate business does not experience "backlogs" as that term is generallyunderstood, nor is it seasonal.

Tothe Company's knowledge, its real estate business is not dependent upon asingle customer but there is a dependency on supermarkets for strip malls.  TheCompany has Stop & Shop, Price Rite and Big Y as such tenants.

 

 

13

 

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** **

**FIRST HARTFORD CORPORATION AND SUBSIDIARIESMANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF OPERATIONS**

**  **

**Item 4.               CONTROLSAND PROCEDURES**

Our management, including ourchief executive officer and chief financial officer carried out an evaluationof the effectiveness of our disclosure controls and procedures as of October31, 2004, pursuant to Exchange Act Rules 13(a)-15(e) and 15(d)-15(e).  Basedupon that evaluation our chief executive officer and chief financial officerhave concluded that as of such date, our disclosure controls and procedures inplace are adequate to ensure material information and other informationrequiring disclosure is identified and communicated on a timely basis.  Therewere no significant changes in the registrant's internal controls or in otherfactors that could significantly affect these controls subsequent to the dateof their evaluation.

 

 

 

 

 

 

 

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**FIRST HARTFORD CORPORATION AND SUBSIDIARIESOTHER INFORMATION**

**PART II          OTHER INFORMATION**

**Item 1.            LEGALPROCEEDINGS**

On January 29, 2004, a shareholder filed a Form 13D withthe Securities and Exchange Commission indicating that he controls over 19% ofthe Company shares.  That shareholder was Richard E. Kaplan, purportedly aresident of the Commonwealth of Massachusetts.  By Complaint dated February 27,2004, Mr. Kaplan, filed suit against the Company as case No. 04 10402 RCL inthe United States District Court in the District of Massachusetts.  The Companywas served with the complaint on March 2, 2004.  The complaint alleges that theproxy solicitation materials issued by the Company as a prelude to its annualmeeting on January 22, 2004, were false and/or misleading in certain respectsand also omitted certain material information.  As a result thereof, theplaintiff seeks to void the shareholder votes taken at the January 22, 2004shareholder meeting of the Company and have a new vote ordered based uponrevised proxy material which would be required to be issued by the Company. The only shareholder votes taken at the annual meeting were to re-elect thesame Board of Directors which had been serving the Company and to approve anEmployee Stock Option Plan.

TheCompany believes strongly that information in its proxy materials was neitherfalse nor misleading and that the lawsuit is without merit.

TheCompany is not aware of any other material legal proceedings which would needto be cited herein.

**Item 2.            CHANGES IN SECURITIES USE OFPROCEEDS AND ISSUER PURCHASES OF EQUITY SECURITIES**

(a)               Not Applicable.

(b)               Not Applicable.

(c)               Not Applicable.

(d)               Not Applicable.

**Item 3.           DEFAULTSUPON SENIOR SECURITIES**

(a)               Not Applicable.

(b)               Not Applicable.  The Company hasnot declared any dividends.

**Item 4.            SUBMISSIONOF MATTERS TO VOTE OF SECURITY HOLDERS**

(a)               Not Applicable.

(b)                NotApplicable.

15

 

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**FIRST HARTFORD CORPORATION AND SUBSIDIARIESOTHER INFORMATION**

**Item 5.              OTHERINFORMATION**

**Item 6.              EXHIBITSAND REPORTS ON FORM 8-K**

                        
a)     Exhibits:          			Exhibit 31.1       Certification of Chief Executive Officer, pursuant to Rule			13a-14(c) 			under the SecuritiesExchange Act of 1934.         			Exhibit 31.1       Certification of Chief Financial Officer, pursuant to Rule			13a-14(c)			under the SecuritiesExchange Act of 1934.  
       Exhibit 32.1       
Certification of Chief Executive Officer, pursuant to 18 U.S.C.						Section 1350.  
        Exhibit 32.1       
Certification ofChief Financial Officers, pursuant to 18 U.S.C. 			Section 1350.  b)    Form 8-K         			Regulation FD Disclosures Re: Construction of Police Station in						Cranston, RI.        			Form 8-K          Regulations FD Disclosure RE: Shopping Center in Bangor, 			Maine.        			Form 8-K          Item 2.03 Creation of a Financial Obligation - Re: $9,250,000			Mortgage.          			Form 8-K          Item 5.03 Amendment to By-Laws        			Form 8-K          Item 2.03 Creation of a Financial Obligation - Re: $5,600,000						Mortgage.
                                    
       			Form 8-K          Item 2.03 Creation of a Financial Obligation - Re: $5,300,000						Mortgage.
Theannual meeting set for December 9, 2004 has been postponed due to theshareholder suit referred to in Item 1.

            

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**SIGNATURES**

Pursuant to the requirements of the Securities ExchangeAct of 1934, the Registrant has duly caused this report to be signed on itsbehalf by the undersigned thereunto duly authorized.

FIRST HARTFORD CORPORATION AND SUBSIDIARIES

/s/ Stuart GreenwaldStuart GreenwaldTreasurerChief Financial(Duly Authorized Officer, PrincipalFinancial and Accounting Officer)

Date:    December 15, 2004

17
 
 

 

**  **

**PART II - OTHERINFORMATION**

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** **

**Signatures**

Pursuantto the requirements of the Securities Exchange Act of 1934, the Registrant hasduly caused this report to be signed on its behalf by the undersigned thereuntoduly authorized.

**FIRSTHARTFORD CORPORATION**

** **

** **

** **

** **

/s/StuartI. GreenwaldStuartI. GreenwaldTreasurerChiefFinancial Officer(DulyAuthorized Officer, PrincipalFinancialand Accounting Officer)

**Date:**December 15, 2004

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