**UNITED STATES**

**SECURITIES AND EXCHANGECOMMISSION**

**Washington,D.C.  20549**

 

**FORM 10-QSB**

**(Mark One)**

 

**ý              QUARTERLY REPORT PURSUANT TOSECTION 13 OR 15(d) OF                        THE SECURITIESEXCHANGE ACT OF 1934**

 

**For thequarterly period ended September 30, 2004**

 

**OR**

 

**TRANSITION REPORT PURSUANT TOSECTION 13 OR 15(d) OF                        THE SECURITIESEXCHANGE ACT OF 1934**

 

**For thetransition period from             to            **

 

**Commissionfile number  0-10272**

 

**Winthrop Residential AssociatesI, A Limited Partnership**

(Exactname of small business issuer as specified in its charter)

 
| **Maryland**                                                                |   | **04-2720493**                        |
|-----------------------------------------------------------------------------|--------|---------------------------------------|
| (State  or other jurisdiction of                                            |   | (I.R.S.  Employer Identification No.) |
| incorporation  or organization)                                             |   |                                  |
|                                                                        |   |                                  |
| **7 Bulfinch Place, Suite 500, Boston, MA**                                 |   | **02114-9507**                        |
| (Address  of principal executive office)                                    |   | (Zip  Code)                           |
|                                                                        |   |                                  |
| Registrant’s  telephone number, including area code **(617) 570-4600** |

 

 

Indicateby check mark whether Registrant (1) has filed all reports required to be filedby Section 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the Registrant wasrequired to file such reports), and (2) has been subject to such filingrequirements for the past 90 days.  Yes ý    No o

 

 

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**WINTHROPRESIDENTIAL ASSOCIATES I, A LIMITED PARTNERSHIP**

**FORM10-QSB SEPTEMBER 30, 2004**

 

**PART 1 - FINANCIAL INFORMATION**

 

***Item 1. Financial Statements.***

***Balance Sheets***

***(In Thousands, Except Unit Data)***

 

 
| *** ***                                                                                                                       | *** *** | **September 30,** | ** ** | ** **       | *** *** |
|------------------------------------------------------------------------------------------------------------------------------------|--------------|-------------------|------------|------------------|--------------|
| *** ***                                                                                                                       | *** *** | **2004**          | ** ** | **December 31,** | *** *** |
| *** ***                                                                                                                       | *** *** | **(Unaudited)**   | ** ** | **2003**         | *** *** |
| *Assets*                                                                                                                           |         |              |       |             |         |
|                                                                                                                               |         |              |       |             |         |
| Cash and cash equivalents                                                                                                          |         | $                 | 387        |             | $            | 462 |   |
|                                                                                                                               |         |              |       |             |         |
| Total Assets                                                                                                                       |         | $                 | 387        |             | $            | 462 |   |
|                                                                                                                               |         |              |       |             |         |
| *Liabilities and Partners’ Capital*                                                                                           |         |              |       |             |         |
|                                                                                                                               |         |              |       |             |         |
| Liabilities:                                                                                                                       |         |              |       |             |         |
|                                                                                                                               |         |              |       |             |         |
| Accrued expenses                                                                                                                   |         | $                 | 11         |             | $            | 13 |   |
|                                                                                                                               |         |              |       |             |         |
| Total Liabilities                                                                                                                  |         | 11                |       | 13               |         |
|                                                                                                                               |         |              |       |             |         |
| Partners’ Capital:                                                                                                            |         |              |       |             |         |
|                                                                                                                               |         |              |       |             |         |
| Limited Partners -                                                                                                                 |         |              |       |             |         |
| Units of Limited Partnership Interest, $1,000 stated value per unit;  25,676 units authorized; 25,595 units issued and outstanding |         | 1,475             |       | 1,544            |         |
| General Partners’ deficit                                                                                                     |         | (1,099            | )          | (1,095           | )            |
|                                                                                                                               |         |              |       |             |         |
| Total Partners’ Capital                                                                                                       |         | 376               |       | 449              |         |
|                                                                                                                               |         |              |       |             |         |
| Total Liabilities and Partners’ Capital                                                                                       |         | $                 | 387        |             | $            | 462 |   |

 

 

2

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***Statements of Operations(Unaudited)***

*** ***

***(In Thousands, Except Unit Data)***

 

 
| *** ***                                             | *** *** | **For the Three Months Ended** | ** ** | **For the Nine Months Ended** | *** *** |
|----------------------------------------------------------|--------------|--------------------------------|------------|-------------------------------|--------------|
| *** ***                                             | *** *** | **September 30,**              | ** ** | **September 30,**             | ** **   | **September 30,** | ** ** | **September 30,** | *** *** |
| *** ***                                             | *** *** | **2004**                       | ** ** | **2003**                      | ** **   | **2004** | ** ** | **2003** | *** *** |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| *Income:*                                                |         |                           |       |                          |         |   |   |   |   |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Income from Local Limited Partnership cash distributions |         | $                              | —     |                          | $            | — |   | $ | — |   | $ | 4 |   |
| Interest                                                 |         | —                         |       | 2                             |         | 2 |   | 4 |   |
| Other income                                             |         | 3                              |       | —                        |         | 3 |   | — |   |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Total income                                             |         | 3                              |       | 2                             |         | 5 |   | 8 |   |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| *Expenses:*                                              |         |                           |       |                          |         |   |   |   |   |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| General and administrative                               |         | 33                             |       | 32                            |         | 78 |   | 97 |   |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Total expenses                                           |         | 33                             |       | 32                            |         | 78 |   | 97 |   |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Net loss                                                 |         | $                              | (30        | )                             | $            | (30 | ) | $ | (73 | ) | $ | (89 | ) |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Net loss allocated to General Partners                   |         | $                              | (2         | )                             | $            | (1 | ) | $ | (4 | ) | $ | (4 | ) |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Net loss allocated to Limited Partners                   |         | $                              | (28        | )                             | $            | (29 | ) | $ | (69 | ) | $ | (85 | ) |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Net loss per Unit of Limited Partnership Interest        |         | $                              | (1.10      | )                             | $            | (1.13 | ) | $ | (2.70 | ) | $ | (3.32 | ) |
|                                                     |         |                           |       |                          |         |   |   |   |   |
| Distributions per Unit of Limited Partnership Interest   |         | $                              | —     |                          | $            | — |   | $ | — |   | $ | 0.94 |   |
|                                                     |         |                           |       |                          |         |   |   |   |   |

 

 

3

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***Statement of Partners’ Capital (Unaudited)***

*** ***

***(In Thousands, Except Unit Data)***

 
| ** **                   | ** **   | **Units of**    | ** **   | ** **         | ** **   | ** **         | ** **   | ** **         | ** **   |
|------------------------------|--------------|-----------------|--------------|--------------------|--------------|--------------------|--------------|--------------------|--------------|
| ** **                   | ** **   | **Limited**     | ** **   | **Limited**        | ** **   | **General**        | ** **   | **Total**          | ** **   |
| ** **                   | ** **   | **Partnership** | ** **   | **Partners’** | ** **   | **Partners’** | ** **   | **Partners’** | ** **   |
| ** **                   | ** **   | **Interest**    | ** **   | **Capital**        | ** **   | **Deficit**        | ** **   | **Capital**        | ** **   |
| *** ***                 | *** *** | *** ***    | *** *** | *** ***       | *** *** | *** ***       | *** *** | *** ***       | *** *** |
| Balance - January 1, 2004    |         | 25,595          |         | $                  | 1,544        |               | $            | (1,095             | )            | $ | 449 |   |
|                         |         |            |         |               |         |               |         |               |         |
| Net loss                     |         | —          |         | (69                | )            | (4                 | )            | (73                | )            |
|                         |         |            |         |               |         |               |         |               |         |
| Balance - September 30, 2004 |         | 25,595          |         | $                  | 1,475        |               | $            | (1,099             | )            | $ | 376 |   |
|                         |         |            |         |               |         |               |         |               |         |

 

 

4

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***Statements of Cash Flows (Unaudited)***

 

***(In Thousands)***
| *** ***                                                                 | *** *** | **For the Nine Months Ended** | *** *** |
|------------------------------------------------------------------------------|--------------|-------------------------------|--------------|
| *** ***                                                                 | *** *** | **September 30,**             | ** **   | **September 30,** | *** *** |
| *** ***                                                                 | *** *** | **2004**                      | ** **   | **2003** | *** *** |
|                                                                         |         |                          |         |   |   |
| *Cash Flows From Operating Activities:*                                      |         |                          |         |   |   |
|                                                                         |         |                          |         |   |   |
| Net loss                                                                     |         | $                             | (73          | ) | $ | (89 | ) |
| Adjustments to reconcile net loss to net cash used in operating  activities: |         |                          |         |   |   |
| Income from Local Limited Partnership cash distributions                     |         | —                        |         | (4 | ) |
| Changes in assets and liabilities:                                           |         |                          |         |   |   |
| Decrease in accrued expenses                                                 |         | (2                            | )            | (3 | ) |
|                                                                         |         |                          |         |   |   |
| Cash used in operating activities                                            |         | (75                           | )            | (96 | ) |
|                                                                         |         |                          |         |   |   |
| *Cash Flows From Investing Activities:*                                      |         |                          |         |   |   |
|                                                                         |         |                          |         |   |   |
| Distributions received from Local Limited Partnership                        |         | —                        |         | 4 |   |
|                                                                         |         |                          |         |   |   |
| Cash provided by investing activities                                        |         | —                        |         | 4 |   |
|                                                                         |         |                          |         |   |   |
| *Cash Flows From Financing Activities:*                                      |         |                          |         |   |   |
|                                                                         |         |                          |         |   |   |
| Distributions to partners                                                    |         | —                        |         | (24 | ) |
|                                                                         |         |                          |         |   |   |
| Cash used in financing activities                                            |         | —                        |         | (24 | ) |
|                                                                         |         |                          |         |   |   |
| Net decrease in cash and cash equivalents                                    |         | (75                           | )            | (116 | ) |
|                                                                         |         |                          |         |   |   |
| Cash and cash equivalents, beginning of period                               |         | 462                           |         | 598 |   |
|                                                                         |         |                          |         |   |   |
| Cash and cash equivalents, end of period                                     |         | $                             | 387          |   | $ | 482 |   |

 

 

5

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**NOTES TO FINANCIAL STATEMENTS**

 

1.             ***General***

 

Theaccompanying financial statements, footnotes and discussions should be read inconjunction with the financial statements, related footnotes and discussionscontained in the Partnership’s Annual Report on Form 10-KSB for the year endedDecember 31, 2003.

 

Thefinancial information contained herein is unaudited.  In the opinion of management, all adjustmentsnecessary for a fair presentation of such financial information have beenincluded.  All adjustments are of anormal recurring nature.  The balancesheet at December 31, 2003 was derived from audited financial statements atsuch date.

 

Theresults of operations for the nine months ended September 30, 2004 and 2003 arenot necessarily indicative of the results to be expected for the full year.

 

6

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**Item 2.            *Management’s Discussionand Analysis or Plan of Operation***

 

The mattersdiscussed in this Form 10-QSB contain certain forward-looking statements andinvolve risks and uncertainties (including changing market conditions,competitive and regulatory matters, etc.) detailed in the disclosure containedin this Form 10-QSB and the other filings with the Securities and ExchangeCommission made by the Partnership from time to time.  The discussion of the Partnership’sliquidity, capital resources and results of operations, includingforward-looking statements pertaining to such matters, does not take intoaccount the effects of any changes to the Partnership’s operations.Accordingly, actual results could differ materially from those projected in theforward-looking statements as a result of a number of factors, including thoseidentified herein.

 

This Item should be read in conjunction with the financial statementsand other items contained elsewhere in the report.

 

Liquidityand Capital Resources

 

As of September 30, 2004,the Partnership retained an equity interest in three Local LimitedPartnerships, each of which owns one apartment complex.  One property is located in Michigan and twoproperties are located in North Carolina.

 

The level of liquidity basedon cash and cash equivalents experienced a $75,000 decrease for the nine monthsended September 30, 2004, as compared to December 31, 2003, as a result of$75,000 of cash used in operating activities. At September 30, 2004 the Partnership had $387,000 in cash and cashequivalents, which have been invested primarily in repurchase agreements and amoney market account.

 

The Partnership’s primary source of income isdistributions from the Local Limited Partnerships. The Partnership requirescash to pay general and administrative expenses and to make capitalcontributions to any of the Local Limited Partnerships which the managinggeneral partner deems to be in the Partnership’s best interest to preserve itsownership interest. To date, all cash requirements have been satisfied byinterest income, cash distributed by the Local Limited Partnerships to thePartnership, by loans or from cash reserves. The Partnership did not make cash distributions to its partners duringthe nine months ended September 30, 2004.

 

The Partnership does notintend to make advances to fund future operating deficits incurred by any LocalLimited Partnership, but retains its prerogative to exercise business judgmentto reverse this position if circumstances change.  Moreover, the Partnership is not obligated toprovide any additional funds to the Local Limited Partnerships to fundoperating deficits.  If a Local LimitedPartnership sustains continuing operating deficits and has no other sources offunding, it is likely that it will eventually default on its mortgageobligations and risk a foreclosure on its property by the lender.  If a foreclosure were to occur, the LocalLimited Partnership would lose its investment in the property and would incur atax liability due to the recapture of tax benefits taken in prior years.  The Partnership, as an owner of the LocalLimited Partnership, would share these consequences in proportion to itsownership interest in the Local Limited Partnership.

 

None of the recently issuedaccounting standards had any effect on the Partnership’s financial statements.

 

7

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** **

**Item 2.            *Management’s Discussionand Analysis or Plan of Operation (Continued)***

 

Resultsof Operations

 

The Partnership’s net lossdecreased by $16,000 to a net loss of $73,000 for the nine months endedSeptember 30, 2004, as compared to a net loss of $89,000 for the comparableperiod in 2003, due to a decrease in expenses of $19,000 which was partiallyoffset by a decrease in income of $3,000.

 

Income decreased due to a$4,000 decrease in cash distributions received from Local Limited Partnershipsand a $2,000 decrease in interest income which were partially offset by anincrease in other income of $3,000. Expenses decreased due to a decrease in various general andadministrative expenses of $19,000.

 

Quantitativeand Qualitative Disclosures of Market Risk

 

The Partnership does nothave any financial instruments that would expose it to market risk associatedwith the risk of loss arising from adverse changes in market rates and prices.

 

**Item3.*****            Controls andProcedures***

 

The Partnership’s management, with the participation of the Partnership’sChief Executive Officer and Chief Financial Officer, has evaluated theeffectiveness of the Partnership’s disclosure controls and procedures (as suchterm is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, asamended) as of the end of the period covered by this report.   Based on such evaluation, the Partnership’sChief Executive Officer and Chief Financial Officer have concluded that, as ofthe end of such period, the Partnership’s disclosure controls and proceduresare effective.

 

There have not been any changes in the Partnership’s internal controlover financial reporting (as defined in Rule 13a-15(f) under the SecuritiesExchange Act of 1934, as amended) during the fiscal quarter to which this reportrelates that have materially affected, or are reasonably likely to materiallyaffect, the Partnership’s internal control over financial reporting.

 

8

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***Part II - OtherInformation***

 

 

***Item 6.       Exhibits***

 

                                                Exhibitsrequired by Item 601 of Regulation S-B are filed herewith and are listed in theattached Exhibit Index.

 

9

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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,thereunto duly authorized.

 

 

 

 

 
|   | WINTHROP RESIDENTIAL  ASSOCIATES I,  A LIMITED PARTNERSHIP |
|--------|------------------------------------------------------------|
|   |                                                       |   |
|   | BY                                                         | ONE WINTHROP PROPERTIES,  INC. |
|   | Managing General Partner                                   |
| :      |                                                       |
|   |                                                       |
|   |                                                       | BY: | /s/ Michael L. Ashner |
|   | Michael L. Ashner                                          |   |
|   | Chief Executive Officer                                    |   |
|   |                                                       |
|   |                                                       |   |
|   |                                                       | BY: | /s/ Thomas C. Staples |
|   |                                                       | Thomas C. Staples |
|   |                                                       | Chief Financial Officer |
|   |                                                       |   |
|   |                                                       | Dated: November 10, 2004 |
|        |                                                            |  |  |  |

 

 

10

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***Exhibit Index***

 

 

 
| **Exhibit** |   |                                                                                                                                                                               |
|-------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |   |                                                                                                                                                                               |
| 31.1        |   | Chief Executive Officer’s  Certification, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                          |
|        |   |                                                                                                                                                                               |
| 31.2        |   | Chief Financial  Officer’s Certification, pursuant to Section 302 of the Sarbanes-Oxley Act of  2002.                                                                         |
|        |   |                                                                                                                                                                               |
| 32          |   | Certification of  Chief Executive Officer and Chief Financial Officer, pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of  2002. |
|        |   |                                                                                                                                                                               |
| 99          |   | Supplementary Information  Required Pursuant to Section 9.4 of the Partnership Agreement.                                                                                          |
|        |   |                                                                                                                                                                               |

 

 

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