U.S.
Securities and Exchange Commission


Washington,
D.C. 20549
  
  FORM
10-Q
  
 [X]           QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF
1934
 
 For the Quarterly Period Ended March
31, 2009
 
  [
]            TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF
1934
  For
the Transition Period From ____to _____
 
 Commission
File Number
 000-1310893
  
 BLUESKY
SYSTEMS, CORP.
 (Exact
name of small business issuer as specified in its charter)
  
 Pennsylvania
                05-6141009(State
      or other jurisdiction of
                (IRS
      Employer Identification No.)incorporation
      or organization)
 
 191 Chestnut Street,
Springfield, MA. 01103
 (Address
of principal executive offices)
 
 (413)
734-3116
 (Issuer's
telephone number, including area code)
 
 Indicate
by check mark whether the registrant (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes [x] No [ ]
 
 Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Website, if any, every Interactive Date File required to be
submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files). Yes [x] No [ ]
 
  Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definitions of “large accelerated filer”, “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
  Large
      accelerated filer
               ̈Non-accelerated
      filer
               ̈(Do
      not check if a smaller reporting company)Accelerated
      filer
               ̈Smaller
      reporting company
              þ
 
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes [  ] No [X]
 
 Number of
shares of common stock outstanding as of May 15,
2009:      25,498,933
  CAUTIONARY
STATEMENT REGARDING FORWARD LOOKING INFORMATION
  The
discussion contained in this 10-Q under the Securities Exchange Act of 1934, as
amended, contains forward-looking statements that involve risks and
uncertainties. The issuer's actual results could differ significantly from those
discussed herein. These include statements about our expectations, beliefs,
intentions or strategies for the future, which we indicate by words or phrases
such as "anticipate," "expect," "intend," "plan," "will," "we believe," "the
Company believes," "management believes" and similar language, including those
set forth in the discussions under "Notes to Financial Statements" and
"Management's Discussion and Analysis or Plan of Operation" as well as those
discussed elsewhere in this Form 10-Q. We base our forward-looking statements on
information currently available to us, and we assume no obligation to update
them. Statements contained in this Form 10-Q that are not historical facts are
forward-looking statements that are subject to the "safe harbor" created by the
Private Securities Litigation Reform Act of 1995.
 
 
 
 
  INDEX TO FORM 10-Q
   PART
I                                                                                                                                                                                                                                                                                                       
Page No.
 
 Item
1.  Financial
Statements                                                                                                                                                                                                                                                                              3
 
 Item
2.  Management's Discussion and Analysis of Financial Condition and
Results of
Operations                                                                                                                                                  
9
  Item
3.  Quantitative and Qualitative Disclosures About Market
Risk                                                                                                                                                                                                      
14
 
 Item 4.
Controls and
Procedures                                                                                                                                                                                                                                                                      
14
  Item 4T.
Controls and
Procedures                                                                                                                                                                                                                                                                    14
  PART
II
  Item
1.  Legal
Proceedings                                                                                                                                                                                                                                                                                
15
  Item 1A.
Risk
Factors                                                                                                                                                                                                                                                                                         
15
 
 Item
2.  Unregistered Sales of Equity Securities and Use of
Proceeds                                                                                                                                                                                                      
16
  Item
3.  Defaults Upon Senior
Securities                                                                                                                                                                                                                                                        
16
  Item
4.  Submission of Matters to a Vote of Security
Holders                                                                                                                                                                                                                    
16
  Item
5.  Other
Information                                                                                                                                                                                                                                                                                  
16
  Item
6.  Exhibits                                                                                                                                                                                                                                                                                                    17
  2
 Table
of Contents
 
 
 ITEM 1.FINANCIAL
STATEMENTS
  INDEX
TOBLUESKY SYSTEMS
CORPORATION FINANCIAL STATEMENTS
 
 BLUESKY SYSTEMS
CORPORATION                                                                                                                                                                                                                               
                     PAGE
 
 Balance
Sheets                                                                                                                                                                                                                                                                                    4
 
 Statements
of
Operations                                                                                                                                                                                                                                                                  5
 
 Statement
of Stockholders’
Equity                                                                                                                                                                                                                                                  6
 
 Statements
of Cash
Flows                                                                                                                                                                                                                                                                 7
 
 Notes to
Financial
Statements                                                                                                                                                                                                                                                         
8
  3
 Table
of Contents
  BLUESKY
SYSTEMS CORPORATION
 BALANCE
SHEETS
 AS OF
MARCH 31, 2009 AND DECEMBER 31, 2008
  (Unaudited)
                      
                      
                      (Audited)Assets:
                      
                      
                      
                      
                      
                      
                      
                      3/31/2009
                      
                      
                      12/31/2008Current
      assetsCash
                      
                      
                      
                      
                      
                      
                      $          76
                      
                      
                      $             -Total
      current assets
                      
                      
                      
                      
                      
                      76
                      
                      
                      -Fixed
      assetsProperty
      and equipment
                      
                      
                      
                      
                      105,000
                      
                      
                      105,000Accumulated
      depreciation
                      
                      
                      
                      
                      (1,620)
                      
                      
                      (648)Total
      fixed assets
                      
                      
                      
                      
                      
                      
                      103,380
                      
                      
                      104,352Total
      assets
                      
                      
                      
                      
                      
                      
                      
                      $       103,456
                      
                      
                      $      104,352Liabilities
      and Stockholders' DeficitCurrent
      liabilitiesAccounts
      payable and other current liabilities
                      
                      
                      $           8,500
                      
                      
                      $          8,500Current
      portion of mortgage payable
                      
                      
                      
                      1,114
                      
                      
                      5,000Total
      current liabilities
                      
                      
                      
                      
                      
                      9,614
                      
                      
                      13,500Long-term
      mortgage payable
                      
                      
                      
                      
                      
                      103,793
                      
                      
                      100,185Total
      liabilities
                      
                      
                      
                      
                      
                      
                      113,407
                      
                      
                      113,685Stockholders'
      DeficitCommon
      stock, (50,000,000 shares authorized, 25,498,933 shares
    issuedand
      outstanding, par value $.001 per share)
                      
                      
                      25,499
                      
                      
                      25,499Additional
      paid-in capital
                      
                      
                      
                      
                      1,234,070
                      
                      
                      1,234,070Retained
      deficit
                      
                      
                      
                      
                      
                      (1,269,520)
                      
                      
                      (1,268,902)Total
      stockholders' deficit
                      
                      
                      
                      
                      
                      (9,951)
                      
                      
                      (9,333)Total
      liabilities and stockholders' deficit
                      
                      
                      
                      
                      $       103,456
                      
                      
                      $      104,352
  The
accompanying notes are an integral part of these financial
statements.
  4
 Table
of Contents
  BLUESKY
SYSTEMS CORPORATION
 STATEMENTS
OF OPERATIONS
 FOR THE
THREE MONTHS ENDED MARCH 31, 2009 and 2008 (UNAUDITED)
  Quarter
      Ended
                    
                    
                    Quarter
      Ended3/31/2009
                    
                    
                    3/31/2008Rental
      income
                    
                    $
                    5,850
                    
                    
                    $
                    7,500Total
      revenue
                    
                    
                    5,850
                    
                    
                    
                    7,500Selling,
      general and administrative expenses
                    
                    
                    4,022
                    
                    
                    
                    743Depreciation
                    
                    
                    972
                    
                    
                    
                    2,311Total
      expenses
                    
                    
                    4,994
                    
                    
                    
                    3,054Net
      ordinary income
                    
                    
                    856
                    
                    
                    
                    4,446Other
      income (expense):Interest
      expense
                    
                    
                    (1,474
                    )
                    
                    
                    (2,979
                    )Total
      other (expense)
                    
                    
                    (1,474
                    )
                    
                    
                    (2,979
                    )Net
      income (loss)
                    
                    $
                    (618
                    )
                    
                    $
                    1,467Net
      income (loss) per share, basic and fully diluted
                    
                    $
                    
                    *
                    
                    $
                    
                    *Weighted
      Average Common Shares Outstanding
                    
                    
                    25,498,933
                    
                    
                    
                    15,793,933* =
      Less than $.01 per share.
  The
accompanying notes are an integral part of these financial
statements.
  5
 Table
of Contents
  BLUESKY
SYSTEMS CORPORATION
 STATEMENT
OF STOCKHOLDERS’ EQUITY
 FOR THE
THREE MONTHS ENDED MARCH 31, 2009 (UNAUDITED)
  CommonStock
                  
                  
                  
                  
                  
                  Additional(Par
      Value
                  
                  
                  Common
                  
                  
                  Paid
      in
                  
                  
                  Retained$
                  .001
                  )
                  
                  Shares
                  
                  
                  Capital
                  
                  
                  (Deficit)Balances,
      January 1, 2009
                  
                  $
                  25,499
                  
                  
                  
                  25,498,933
                  
                  
                  $
                  1,243,070
                  
                  
                  $
                  (1,268,902
                  )Net
      loss for the quarter
                  
                  $
                  -
                  
                  
                  
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  (618
                  )Balances,
      March 31, 2009
                  
                  $
                  25,499
                  
                  
                  
                  25,498,933
                  
                  
                  $
                  1,243,070
                  
                  
                  $
                  (1,269,520
                  )
  The
accompanying notes are an integral part of these financial
statements.
  6
 Table
of Contents
  BLUESKY
SYSTEMS CORPORATION
 STATEMENT
OF CASH FLOWS
 FOR THE
THREE MONTHS ENDED MARCH 31, 2009 and 2008 (UNAUDITED)
  Quarter
      Ended
                    
                    
                    Quarter
      Ended3/31/2009
                    
                    
                    3/31/2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      income (loss)
                    
                    $
                    (618
                    )
                    
                    $
                    1,467Adjustments
      to reconcile net income (loss) to net cash provided by(used
      in) operating activities:Depreciation
                    
                    
                    972
                    
                    
                    
                    2,311Increase
      (decrease) in operating liabilities:Accounts
      payable and other current liabilities
                    
                    
                    -
                    
                    
                    
                    (2,381
                    )NET
      CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
                    
                    
                    354
                    
                    
                    
                    1,397CASH
      FLOWS FROM FINANCING ACTIVITIES:Contribution
      of capital from majority shareholder
                    
                    
                    -
                    
                    
                    
                    725Principal
      repayments of long term debt
                    
                    
                    (278
                    )
                    
                    
                    (2,112
                    )NET
      CASH  PROVIDED BY (USED IN) FINANCING ACTIVITIES
                    
                    
                    (278
                    )
                    
                    
                    (1,387
                    )NET
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                    
                    
                    76
                    
                    
                    
                    10CASH
      AND CASH EQUIVALENTS:Beginning
      of period
                    
                    
                    -
                    
                    
                    
                    -End
      of period
                    
                    $
                    76
                    
                    
                    $
                    10OTHER
      SUPPLEMENTAL CASH FLOW DISCLOSURES:Cash
      paid during the period for interest
                    
                    $
                    1,474
                    
                    
                    $
                    2,979Cash
      paid during the period for income taxes
                    
                    $
                    -
                    
                    
                    $
                    -
  The
accompanying notes are an integral part of these financial
statements.
  7
 Table
of Contents
  BLUESKY
SYSTEMS CORPORATION
 NOTES TO
FINANCIAL STATEMENTS
 FOR THE
THREE MONTHS ENDED MARCH 31, 2009 (UNAUDITED)
  NOTE 1 -
BASIS OF PRESENTATION
 
 The
consolidated financial statements of BlueSky Systems, Corp. (the "Company"),
included herein were prepared, without audit, pursuant to rules and regulations
of the Securities and Exchange Commission. Because certain information and notes
normally included in consolidated financial statements prepared in accordance
with accounting principles generally accepted in the United States of America
were condensed or omitted pursuant to such rules and regulations, these
consolidated financial statements should only be read in conjunction with the
consolidated financial statements and notes thereto included in our audited
consolidated financial statements as included in our Form 10-K for the year
ended December 31, 2008.
 
 Interim
Financial Information
 
 The
unaudited interim consolidated financial statements have been prepared in
accordance with United States generally accepted accounting principles for
interim financial information. In the opinion of management, all adjustments
considered necessary for a fair presentation of the financial position, results
of operations and cash flows as of (at) March 31, 2009, and 2008, have been
included. Readers of these consolidated financial statements should note that
the interim results for the three month period ended March 31, 2009 is not
necessarily indicative of the results that may be expected for the fiscal year
as a whole.
 
 NOTE 2 -
SIGNIFICANT ACCOUNTING POLICIES
 
 Background - BlueSky
Systems, Corp. (“The Company”) was organized under the laws of the State of
Pennsylvania in June 2004 as a C-Corporation.  The Company owns one
subsidiary, Oswego Real Estate Services, Inc. (“The Subsidiary”). The
purpose of the Subsidiary is to buy, sell, rent, and improve any and all aspects
of real estate. The Subsidiary currently owns one building in Chicopee,
Massachusetts.
 
 Basis of Presentation
- The consolidated financial statements included herein include the amounts of
BlueSky Systems, Corp. and its subsidiary prepared under the accrual basis of
accounting. All material intercompany accounts and transactions have been
eliminated.
 
 Management's Use of
Estimates - The preparation of consolidated financial statements in
conformity with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosures of contingent assets
and liabilities at the date of consolidated financial statements and the
reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.
 
 NOTE 3 –
NOTES PAYABLE
 
 Mortgages
incurred for the purchase of the rental property consist of the following at
March 31, 2009:
 
 Secured
Commercial Mortgage to an unrelated party, with an interest rate at 6.875% and a
maturity date of June 1, 2037.
 
 Current
Balance
of      $      104,907
  NOTE 3 –
NOTES PAYABLE CONTINUED
 
 The
aggregate amount of long-term debt at March 31, 2009 maturing during each of the
succeeding five years and thereafter is as follows:
  For
      the year ending
                  
                  Amount2009
                  
                  $
                  1,1142010
                  
                  $
                  1,1932011
                  
                  $
                  1,2772012
                  
                  $
                  1,3682013
                  
                  $
                  1,465Thereafter
                  
                  $
                  98,490Total
                  
                  $
                  104,907
 
 NOTE 4 -
GOING CONCERN
 
 As shown
in the accompanying consolidated financial statements, we have suffered
recurring losses from operation to date. We have a net deficiency of $1,269,520
as of March 31, 2009. These factors raise substantial doubt about our ability to
continue as a going concern.
 
 Management's
plans in regard to this matter are to raise equity capital and seek strategic
relationships and alliances in order to increase revenues in an effort to
generate positive cash flow. Additionally, we must continue to rely upon equity
infusions from investors in order to improve liquidity and sustain operations.
The consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
 
 8
 Table
of Contents
  ITEM 2.  
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
  Management’s
Discussion and Analysis contains various “forward looking statements” within
regarding future events or the future financial performance of the Company that
involve risks and uncertainties. Certain statements included in this 10-Q,
including, without limitation, statements related to anticipated cash flow
sources and uses, and words including but not limited to “anticipates”,
“believes”, “plans”, “expects”, “future” and similar statements or expressions,
identify forward looking statements. Any forward-looking statements herein are
subject to certain risks and uncertainties in the Company’s business, including
but not limited to, reliance on key customers and competition in its markets,
market demand, product performance, technological developments, maintenance of
relationships with key suppliers, difficulties of hiring or retaining key
personnel and any changes in current accounting rules, all of which may be
beyond the control of the Company. Management will elect additional changes to
revenue recognition to comply with the most conservative SEC recognition on a
forward going accrual basis as the model is replicated with other similar
markets (i.e. SBDC). The Company’s actual results could differ materially from
those anticipated in these forward-looking statements as a result of certain
factors, including those set forth therein.
  Management’s
Discussion and Analysis of Results of Financial Condition and Results of
Operations (“MD&A”) should be read in conjunction with the financial
statements included herein.
  BUSINESS
DESCRIPTION
 
 We were
incorporated on September 21, 2004 under the laws of the State of Pennsylvania
to engage in the business of buying, selling, renting, and improving real
estate. Over the last year we have been engaged in buying and selling our
property and we have entered into new agreements for the management of new
rental property.  In 2008, we owned 100% of the common stock of School
Second Corp., which, in turn, owned property in central downtown Chicopee,
Massachusetts at 192 School Street. Specifically, we owned a two-story building
that consists of four units and generated revenues by rentals on units. During
2008 we sold this property and acquired a new property in Springfield,
Massachusetts in western Massachusetts at 12-14 Osgood Street. 
Accordingly, all of the leases and agreements relating to the property at 192
School Street were terminated.
 
 The
Registrant sold the property at 192 School Street, Chicopee, Massachusetts to
Serena Cieplinski of 5126 Castle Harbor Way, Centreville, VA 20120 on October
29, 2008 for $212,500.
 
 Also on
October 29, 2008 the Registrant entered into a Stock Purchase Agreement between
Pablo Torres, the majority shareholder of Oswego Real Estate Services, Inc.
(“Seller”) and Bluesky
Systems Corporation (“Buyer” or
“Bluesky”).
 
 The
Seller sold 20,000,000 shares (twenty million) of Oswego Real Estate Services,
Inc. (“Oswego”) in exchange for 250,000 shares (two hundred fifty thousand) of
Bluesky Systems Corporation and $5,000 so that such property located at 12-14
Osgood Street in Springfield, Massachusetts (“Property”) is owned by the Buyer.
The Buyer and Seller agreed and Philips become a wholly owned subsidiary of the
Buyer.
 
 As per
the terms of the Stock Purchase Agreement, the mortgage will continue to be the
personal liability of the Seller until paid in full by him. All rental proceeds
are to be collected by and controlled by the Seller until the property is resold
and any negative cash flows for repairs or expenses will be the sole
responsibility of the Seller. Furthermore in the event, cash flow after all
expenses exceeds 20%, Bluesky and the Seller will equally share the proceeds.
Upon liquidation of the property after expenses, the Seller will receive 25% of
the capital gains profit and Bluesky will receive 75% of the capital gains
profit. If the Seller is incapable of managing the property, then Bluesky will
hire a professional property management company to manage the day to day
operations, at the Seller’s expense. Additionally, 100,000 (one hundred
thousand) shares of the 250,000 (two hundred fifty thousand) shares are to be
sold at a mutually acceptable price and the proceeds to be used exclusively for
the pay down of the mortgage on the 12-14 Osgood Street property. Bluesky paid
$5,000 (five thousand) dollars for consideration in this
transaction
 
 Our
executive offices are located at 191 Chestnut Street in Springfield,
Massachusetts 01103. Our telephone number is (413) 734-3116. We are currently
authorized to issue 50,000,000 shares of common stock. We currently have
25,498,933 shares of common stock issued and outstanding.
 
 Our
business plan is to buy more investment properties, which we believe have good
cash flows or good cash flow potential, plus a favorable estimated resale value.
We plan to lease our properties primarily to residential tenants. We plan to
make limited improvements to our properties (on a case by case basis, if
commercially reasonable), so that we can increase occupancy, improve cash flows,
and enhance potential resale value.
 
 As shown
in the accompanying audited financial statements, we have suffered recurring
losses from operations since our inception. We experienced losses of $936,743
and $18,729 during 2008 and 2007, respectively. We also had a total accumulated
deficit of $1,269,520 as of March 31, 2009. These factors raise substantial
doubt about our ability to continue as a going concern.
  THE
BUILDING AT 192 SCHOOL STREET
  On
September 21, 2004, we acquired 100% of the common stock of School Second Corp.,
which in turn, owns 100% of a two-story apartment house, with four units in
central downtown Chicopee, Massachusetts located at 192 School Street, which the
board of directors had identified as an acceptable business
opportunity.
 
 We
contracted with Lessard Property Management, Inc. to manage the lease on our
behalf however all contracts were terminated when the property was
sold.
  On
October 29, 2008, we sold the property at 192 School Street in the amount of
$212,500.
  THE
BUILDING AT 12-14 OSGOOD STREET, SPRINGFIELD, MASSACHUSETTS
  On
October 29, 2008, we acquired 20,000,000 shares of common stock of Oswego Real
Estate Services, Inc. (“Oswego) in exchange for 250,000 shares of the Company
along with $5,000 in additional cash consideration. In turn, Oswego became a
wholly owned subsidiary of the Company and the property located at 12-14 Osgood
Street in Springfield, Massachusetts is now owned by the Company through its
subsidiary Oswego Real Estate Services.
 
 The
building at 12-14 Osgood Street consists of 2 family rental units. Both units
are currently leased and yield approximately $1,200 rental income per month. The
mortgage payable on this property as of December 31, 2008 is
$105,000.
  9
 Table
of Contents
  OVERVIEW
OF OUR MARKET AREA
 
 The city
of Chicopee lies on the outskirts of the Springfield, Massachusetts urban area,
located in the Pioneer Valley near the intersection of U.S. Interstates 90 (the
Massachusetts Turnpike) and 91.  Interstate 90 is the major east-west
highway crossing Massachusetts. Interstate 91 is the major north-south highway
that runs directly through the heart of New England. Chicopee is located
approximately 90 miles west of Boston, Massachusetts, 70 miles southeast of
Albany, New York and 30 miles north of Hartford,
Connecticut.  Chicopee is located in Hampden County, Massachusetts,
whose estimated 2006 population was 460,805.
 
 The
economy in our primary market area enjoys the presence of large employers such
as the University of Massachusetts, Baystate Medical Center, Mass Mutual Life
Insurance Company, Big Y Foods, Inc., Friendly Ice Cream Corporation, Old Colony
Envelope, Hamilton Standard, Pratt and Whitney and Strathmore Paper Company.
Other employment and economic activity is provided by financial institutions,
eight other colleges and universities, seven other hospitals and a variety of
wholesale and retail trade businesses.
 
 Respected
national economists have given mixed opinions about the market for multi-family
rentals in 2006.  However, according to Moody's, Economy.com and
Fiserv Lending Solutions, Springfield MA is expected to see slight gains of
0.8%, while the rest of the state is expected to see significant losses as high
as -3.0%.
 
 Recent
local developments, such as the proposed New Haven-Hartford-Springfield commuter
rail line, have brought improvements to the local economy.  According
to the NAI 2006 Global Market Report, although there will be some slowdown in
the real estate market in Western Massachusetts, it is expected that the
Springfield, Massachusetts area will not see a dramatic drop in market prices
like many of the costal regions of the state.
  The City
of Chicopee Assessor's Office reported 2,579 multi-family units in 2006 and the
Pioneer Valley Planning Commission's SOCDS Building Permits Database shows an
increase of 120% in permits for multi-family structures in Springfield from 2002
to 2006.
 
 These
market factors form the setting in which we plan to execute our business
model.
  OUR PLAN
TO ACQUIRE OTHER RENTAL PROPERTIES
 
 Our
business plan is to buy more rental properties that we believe are undervalued,
compared to their cash flows and estimated resale value. Our strategy is to
identify rental properties with a favorable purchase price relative to their
market value, as well as positive cash flow. We plan to buy properties primarily
leased to residential tenants. We are prepared to make some improvements to our
properties (on a case by case basis, if commercially reasonable), so that we can
increase occupancy, improve cash flows, and enhance potential resale value.
However, given our current financial condition, we will most likely seek
properties in the Springfield, Massachusetts area for the next 12
months.  However, after that time, we also plan to explore the
possibility of acquiring additional properties in other areas of Western
Massachusetts and possibly North Carolina.
 
 Our
success will be dependent upon implementing our plan of operations and the risks
associated with our business plans. We operate primarily in the Springfield,
Massachusetts area. We plan to strengthen our position in these markets. We plan
to expand our operations through our acquisition and improvement of real
estate.
 
 We
presently own one two-story apartment house in Springfield, Massachusetts. We
hope to acquire additional real estate in the next 12 months, and to utilize the
rental proceeds of those properties to pay our operating costs for that period;
however, there are no assurances that this revenue will be sufficient to cover
our operating costs. Accordingly, if our revenues are not sufficient, we will
rely upon capital infusions from our director Duane Bennett; however, there are
no assurances that Mr. Bennett will have sufficient funds to provide such
capital infusions. He has made no assurance of the minimum or maximum capital
amounts he could provide.
 
 PROPERTY
LOCATION PROCEDURES
 
 We plan
to conduct a preliminary analysis that consists of:
 
 -
              Reviewing
      real estate sales information provided by local board of realtors
      associations and our review of the census tract increases. The information
      that we may obtain that would weigh in favor or our proceeding with a
      property acquisition would be:o
              High
      volume of real estate sales within the specific areao
              New
      schools and major commercial developments in the areao
              Improved
      state and city roads in the area
 
 The
information that we may obtain that would weigh against our proceeding with a
property acquisition would be:
  o
              Hazardous
      waste in the areao
              Crime
      rates in the area that are higher than the national average (per 100,000
      people, based on 2005 FBI Uniform Crime Reports, released Sept.
      2006)o
              Vacancy
      rates of 10% or more in the area
  The data
that we analyze to determine whether to purchase properties are:
 
 -
              Demographic
      data that suggests increased demand in a specific area. The data that
      would weigh in favor of our proceeding with a purchase would
      be:o
              Continued
      economic development in the area, such as a major corporation moving into
      the area creating new jobs and increasing residential housing
      demand.o
              Increase
      in the population’s median income levels of 5 – 10% per year for a certain
      area.o
              Lower
      than the national average of violent and property crimes in the area (per
      100,000 people, based on 2005 FBI Uniform Crime Reports, released Sept.
      2006)
 
 -
              Demographic
      data that would weigh against a purchase would be:o
              Migration
      of industrial companies outside the area.o
              Decrease
      of 10% or more in median income levelso
              Violent
      and property crime rates in the area that are higher than the national
      average (per 100,000 people, based on 2005 FBI Uniform Crime Reports,
      released Sept. 2006)
 
 In order
to determine and evaluate the fastest growing areas, we will obtain reports from
sources such as the Pioneer Valley Planning Commission, Western Massachusetts
Economic Development Council, Massachusetts Alliance for Economic Development,
and University of Massachusetts Donahue Institute's Economic and Public Policy
Research unit. Most of the reports available through these organizations are
free of charge and will provide detailed information that we will then study to
determine the areas with good growth rates.
 
 We will
also rely on statistics provided by the U.S. Census Bureau to obtain information
pertaining to population shifts and number of total people in a specific area.
In addition, we plan to utilize economic, housing and population data available
from such sources as the Massachusetts Office of Economic Development and
Massachusetts Institute for Social and Economic Research to further assess the
best areas in which to purchase property.
  DETAILED
MARKET AND FINANCIAL ANALYSIS
  Our
President will perform detailed market and financial analysis regarding each
property we decide to review for purchase to determine whether the specific
location is appropriate for acquisition and development. That detailed
information will include the following:
 
 -
              Number
      of properties on the market.-
              Number
      of properties sold in the past 12 months.-
              Sales
      prices asked per property.-
              Sales
      price sold per property.
 
 -
              Total
      square footage and acreage per property-
              Total
      number of units per property.-
              Total
      number of pending closings per
property.
 
 Our
President is a licensed realtor which provides the education for the above
reviews. He acquired training from his past experiences with ABC Realty, Inc.
and Xenicent, Inc. (FKA Great Land Development Corp.)
 
 The
activities that our President engaged in with both of the above noted companies
prior to their business combinations with unrelated businesses in unrelated
industries are identifying perceived under valued properties, developing such
properties by trying to add value in making the properties more valuable, and
subsequently reselling such properties to individual customers.
  10
 Table
of Contents
  PURCHASE
PROCEDURES
  Once we
have located a property that we may want to purchase, if it is not currently
listed for sale, we will ascertain whether the owner is willing to sell the
property*. We then negotiate a purchase price and ask the following questions of
the prospective seller and/or obtain answers from third parties:
 
 -
              When
      does the owner want to sell and close? Favorable conditions we look for
      regarding this factor are:o
              The
      seller is willing and able to sell within a six-month
    period.o
              Typically,
      the timing and motivation of sellers to enter into contract to sell may
      include several factors such as: estate planning, gifts to family, age,
      health and other personal factors.
 
 -
              How
      much will the owner sell the land for? Favorable conditions we will look
      for regarding this factor are:o
              The
      price is below market value. We determine market value through appraisals
      and comparable sales reports in the area.o
              With
      respect to price, we would also consider value trends, such as historical
      yearly increases in property values
 
 -
              Are
      there any defects on the title?  Favorable conditions we will
      look for regarding this factor are:o
              No
      liens and/or encumbrances.o
              The
      buyer is able to deliver a clean title within the time we would like to
      close.
 
 -
              Does
      the landowner have title insurance on the property? Favorable conditions
      we will look for regarding this factor are:o
              The
      landowner has title insurance on the property.o
              The
      landowner is able to secure title insurance on the
    property.o
              We
      would be able to obtain title insurance on the purchased
      property.
 
 We will
obtain the following documents from the seller during our due diligence on the
property:
  -
              General
      maps;-
              Environmental
      reports-
              Copies
      of existing zoning maps and regulations;-
              Conduct
      land inspection procedures;
 
 -
              Proposed
      zoning regulations;-
              Deeds;-
              Title
      insurance; and-
              Tax
      bills.
 
 We then
verify the accuracy of these documents and determine how the information
contained in the documents impacts the property that we are considering to
purchase.
 
 We plan
to evaluate properties not listed for sale because of the potential benefit of
acquiring a property in a particular location at a lower cost by not having to
pay realtor commissions or other costs and fees associated with purchasing
properties only listed for sale with realtors. Since, in this case, there would
not be a seller’s agent, there is a chance that we can get a better price on the
property since a seller would not have to pay a realtor a commission. Therefore,
the seller would not have to absorb the realtor’s commission in to his or hers
selling price, which there is a chance a seller would do in order to obtain his
or her needed price on a property.
 
 OUR
FINANCING PROCEDURES
  We will
attempt to obtain financing from local banks doing business within the area
where we are attempting to purchase property. In the past, our director, Mr.
Bennett, has personally guaranteed repayment of debt for property purchases
along with necessary corporate guarantees for us. We do not have any written
agreements now or in the past with Mr. Bennett, obligating him to guarantee
repayment of future debt or any of our other obligations. Mr. Bennett is not
otherwise under any legal obligation to provide us with capital.
 
 When
obtaining financing we will look for mortgages at the then current lending rates
but will also consider interest rates as high as 11% if we are able to purchase
a property at least 25% below its existing market value, as determined by an
appraiser.
 
 Our
credit status was sufficient enough for us to acquire our current building at
192 School Street so long as we had a personal guarantee of Mr. Bennett. We
believe we can use this same approach for future purchases.
 
 In order
to finance down payments of property purchases in the future, if applicable, we
can seek debt or equity funding from related parties, including our director, as
discussed above. If necessary, we will also attempt to raise capital from
unrelated investors in the form of a debt or equity offering.
 
 The
procedures for obtaining our financing are as follows:
 
 1.
              File
      loan application.2.
              Credit
      checks, property appraisal done.3.
              Loan
      documents drafted.4.
              Down
      payment made that is typically approximately 5 to 10% of the appraised
      value.5.
              Institution
      lends funds for the balance, less certain transaction fees that are
      typically between approximately 2 to 3%.6.
              A
      lien is then filed with the appropriate recorder’s
  office.
 
 There are
no assurances that our financing procedures will be adequate to secure the funds
needed to sustain our operations.
 
 DISTRIBUTION
  We have
no distribution agreements in place with anyone. We plan to sell the properties
we acquire primarily through direct selling efforts involving established real
estate brokers and property managers and corporations that may have a need for
residential and/or commercial real estate. We plan to contract with real estate
brokers, sub-contractors and other agents to assist in us on a
project-by-project basis.
 
 NEW
PRODUCTS OR SERVICES
  We
currently have no new products or services announced to the public. We will make
public announcement in the future upon entering into material contracts to
acquire any new real estate projects.
  11
 Table
of Contents
  COMPETITIVE
BUSINESS CONDITIONS
  We face
significant competition both in acquiring rental properties and in attracting
renters. Our primary market area of residential multi-family unit rentals is
highly competitive, and we face direct competition from a significant number of
multi-family unit landlords, many with a local, state-wide or regional presence
and, in some cases, a national presence. Many of these landlords are
significantly larger and have greater financial resources than us. Our
competition for renters comes from newer built apartment complexes as well as
older apartment buildings.
  In
addition, we face significant competition from home builders and land
developers, because many renters have moved out of the rental market into
single-family homes due to recent mortgage interest rates, which have reached
40-year lows in some cases. Nationally, there are over one hundred major land
developers. Approximately 10% of these developers capture approximately 50% of
the market for such developments. These developers have greater financial
resources than we do and are better poised for market retention and expansion
than we are. Specifically, our competition with national homebuilders is as
follows:
 
 -
              Pulte
      Homes;-
              Ryan
      Homes;-
              Ryland
      Homes;-
              John
      Weiland Homes;
 
 -
              Crescent
      Resources; and-
              Harris
      Group
 
 Of the
builders listed above, Pulte Homes is the only one that currently operates in
Massachusetts.  All the other builders operate in various states on
the East Coast and throughout the country.
 
 These
national homebuilders purchase land or lots of vacant land parcels to build
single-family homes, often in connection with nearby shopping centers and
commercial buildings. The national homebuilders have substantial resources to
enable them to build single-family homes for resale.
 
 These
builders engage in single-family home development and have greater financial
resources than we do. In addition, these companies have greater operational
resources because they are able to perform a variety of development tasks
themselves. These companies purchase vacant land tracts and perform all the work
necessary to construct the homes, such as land clearing and road development and
then build the homes themselves. In contrast, we do not have the financial or
operational resources to perform these tasks. These national and local builders
are better equipped to acquire tracts of land equipped with these capabilities
due to their operational and financial superiority over us.
 
 We have
no competitive advantages over any of the individuals and/or companies against
whom we compete. We have significantly less capital, assets, revenues, employees
and other resources than our local and/or national competition. There are no
barriers to entry into this market.
 
 INTELLECTUAL
PROPERTY
 
 At
present, we do not have any patents, trademarks, licenses, franchises,
concessions, and royalty agreements, labor contracts or other proprietary
interests.
  GOVERNMENT
REGULATION ISSUES
 
 We are
subject to applicable provisions of federal and state securities laws and to
regulations specifically governing the real estate industry, including those
governing fair housing and federally backed mortgage programs. Our operations
will also be subject to regulations normally incident to business operations,
such as occupational safety and health acts, workmen's compensation statutes,
unemployment insurance legislation and income tax and social security related
regulations. Although we will use our best efforts to comply with applicable
regulations, we can provide no assurance of our ability to do so, nor can we
fully predict the effect of these regulations on our proposed
activities.
  RESEARCH
AND DEVELOPMENT
 
 We have
spent no funds on research and development.
 
 EMPLOYEES
  With the
exception of Duane Bennett we have no employees. We have no employment
agreements with any of our management. We do not anticipate hiring any
additional employees in the next 12 months.
 
 RESULTS
OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2009 AND 2008
 
 Revenues
(for the Three Months Ended March 31, 2009 and 2008).
 
 Revenues
decreased $1,650 or 22% to $5,850 for the year ended December 31, 2008, as
compared with $7,500 for the Three Months Ended March 31, 2008. Revenues
consisted of rentals on residential rental properties. We had four leases, of
which three expired in May 2006. The expired leases are now considered
month-to-month leases. The decrease in revenues is attributable to the rental
rates of the School Street property which was sold and the acquisition of the
Osgood Street property.
 
 All sales
transactions were with unrelated parties.
  Cost
of Sales (for the Three Months Ended March 31, 2009 and 2008).
 
 None.
 
 Expenses
(for the Three Months Ended March 31, 2009 and 2008).
 
 Operating
expenses for the Three Months Ended March 31, 2009 increased $1,940 or 63.52% to
$4,994 from $3,054 in 2008. The increase in expenses through the three months
ended March 31, 2009 was due to selling, general and administrative expenses in
the amount of $4,022.
  We do not
have any lease agreements for our principal office and do not currently have any
employment agreements.
 
 Income
Taxes (for the Three Months Ended March 31, 2009 and 2008).
  We had no
provision for income taxes for the Three Months Ended March 31, 2009 and 2008,
respectively, due to our net loss.
 
 If we
incur losses, we may have a deferred tax asset. Deferred tax assets are reduced
by a valuation allowance when, in the opinion of management, it is more likely
than not that, some portion or all of the deferred tax asset will not be
realized. Deferred tax assets and liabilities are adjusted for the effect of
changes in tax laws and rates on the date of enactment. We do not currently have
any net deferred tax assets.
  Income/Losses
(for the Three Months Ended March 31, 2009 and 2008).
 
 We had a
net loss of $(618), or less than $.01 per common share for the Three Months
ended March 31, 2009. This compares to a net income of $1,467, or less than $.01
per common share for the Three Months Ended March 31, 2008. The decrease in net
income is attributable to the increase in general and administrative expenses as
mentioned above.
  Impact
of Inflation.
 
 We
believe that inflation has had a negligible effect on operations since
inception. We believe that we can offset inflationary increases in the cost of
operations by increasing sales and improving operating
efficiencies.
 
 12
 Table
of Contents
  Liquidity
and Capital Resources (for the Three Months Ended March 31, 2009 and
2008).
 
 Cash
flows provided by (used in) operations were $354 and $1,397 for the Three Months
Ended March 31, 2009 and 2008, respectively. These were mainly attributable to
decrease in accounts payable, and non-cash depreciation charges in both periods,
and a net income gain in 2008 compared to a net income loss in
2009.
 
 We had no
cash flows provided by investing activities for the Three Months Ended March 31,
2009.
 
 Cash
flows provided by (used in) financing activities were $(278) and $(1,387) for
the Three Months Ended March 31, 2009 and 2008, respectively. Cash flows used in
these periods were due primarily to repayments on notes payable on our income
producing rental property offset by the capital contributions of $725 from a
shareholder in 2008 only.
  Overall,
we have funded our cash needs from inception through March 31, 2009 with a
series of equity and debt transactions, including those with related parties as
described above. If we are unable to receive additional cash from our related
parties, we may need to rely on financing from outside sources through debt or
equity transactions. Our related parties are under no legal obligation to
provide us with capital infusions. Failure to obtain such financing could have a
material adverse effect on our operations and financial condition. This could
include an inability to do sufficient advertising for the homes that we sell,
which would make us less competitive in the marketplace. We could also find it
more difficult to enter into strategic joint venture relationships with third
parties. Finally, it would most likely delay the implementation of our business
plan. An alternative plan of operation in the event of a failure to obtain
financing would be to continue operations as currently configured, with the
result being little, if any, projected growth. Another alternative would be to
enter into a joint venture with another company that has working capital
available, albeit on less favorable terms than had we obtained financing, for
the development of our business plan.
 
 We had
cash on hand of only $76 and a working capital deficit of $9,538 as of March 31,
2009. Our current amount of cash in the bank is insufficient to fund our
operations for the next twelve months. We will rely on the existence of revenue
from our business, if any, and funding from outside sources; however, we have no
current or projected capital reserves that will sustain our business for the
next 12 months. Also, if the projected revenues fall short of needed capital we
will not be able to sustain our capital needs for the next twelve months. We
will then need to obtain additional capital through equity or debt financing to
sustain operations for an additional year. A lack of significant revenues during
2009 will significantly affect our cash position and make it necessary to raise
additional funds through equity or debt financing. Our current level of
operations would require capital of approximately $10,000 to sustain operations
through year 2009 and approximately $35,000 per year thereafter. Modifications
to our business plans or additional property acquisitions may require additional
capital for us to operate. There can be no assurance that additional capital
will be available to us when needed or available on terms favorable to
us.
  On a
long-term basis, liquidity depends on continuation and expansion of operations,
receipt of revenues, and additional infusions of capital and debt financing. We
are considering launching a local advertising campaign. Our current capital and
revenues are insufficient to fund such marketing. If we choose to launch such a
campaign, we will require substantially more capital. If necessary, we will
raise this capital through an additional stock offering. However, there can be
no assurance that we will be able to obtain additional equity or debt financing
in the future, if at all. If we are unable to raise additional capital, our
growth potential will be adversely affected and we will have to significantly
modify our plans. For example, if we unable to raise sufficient capital to
develop our business plan, we may need to:
 
 - Seek
projects of lesser value or that may be less profitable
 - Seek
smaller projects, which are less capital intensive, in lieu of larger projects;
or
 - Seek
projects that are outside our geographical area to generate some revenue for
us.
  Demand
for our rental services will be dependent on, among other things, market
acceptance of our services, the real estate market in general and general
economic conditions, which are cyclical in nature. Inasmuch as a major portion
of our activities is the receipt of rents from residential properties, our
business operations may be adversely affected by our competitors and prolonged
recession periods.
 
 Our
success will depend upon implementing our plan of operations and the risks
associated with our business plans. We operate a small real estate rental
business in the Springfield, Massachusetts area. We plan to strengthen our
position in this market. We also plan to expand our operations in the
Springfield area.
  Going
concern
 
 As shown
in the accompanying consolidated financial statements, we have suffered
recurring losses from operation to date. We have a net deficiency of $1,269,520
as of March 31, 2009. These factors raise substantial doubt about our ability to
continue as a going concern.
 
 Management's
plans in regard to this matter are to raise equity capital and seek strategic
relationships and alliances in order to increase revenues in an effort to
generate positive cash flow. Additionally, we must continue to rely upon equity
infusions from investors in order to improve liquidity and sustain operations.
The consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
  13
 Table
of Contents
  ITEM
3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKETRISK
 
 The
information to be reported under this item is not required of smaller reporting
companies.
 
 ITEM 4. CONTROLS AND
PROCEDURES
 
 We
maintain disclosure controls and procedures designed to ensure that information
required to be disclosed in reports filed under the Securities Exchange Act of
1934 (“Exchange Act”) is recorded, processed, summarized and reported within the
specified time periods. Our Chief Executive Officer and its Chief Financial
Officer (collectively, the “Certifying Officers”) are responsible for
maintaining our disclosure controls and procedures. The controls and procedures
established by us are designed to provide reasonable assurance that information
required to be disclosed by the issuer in the reports that it files or submits
under the Exchange Act is recorded, processed, summarized and reported within
the time periods specified in the Commission’s rules and forms.
  As of the
end of the period covered by this report, the Certifying Officers evaluated the
effectiveness of our disclosure controls and procedures. Based on the
evaluation, the Certifying Officers concluded that our disclosure controls and
procedures were effective to provide reasonable assurance that information
required to be disclosed by us in the reports that we file or submit under the
Exchange Act is recorded, processed, summarized and reported, within the time
periods specified in the applicable rules and forms, and that it is accumulated
and communicated to our management, including the Certifying Officers, as
appropriate to allow timely decisions regarding required
disclosure.
  The
Certifying Officers have also concluded, based on their evaluation of our
controls and procedures that as of March 31, 2009, our internal controls over
financial reporting are effective and provide a reasonable assurance of
achieving their objective.
  The
Certifying Officers have also concluded that there was no change in our internal
controls over financial reporting identified in connection with the evaluation
that occurred during our fourth fiscal quarter that has materially affected, or
is reasonably likely to materially affect, our internal control over financial
reporting.
 
 ITEM 4T. CONTROLS AND
PROCEDURES
  (a) Conclusions
regarding disclosure controls and procedures. Disclosure controls and
procedures are the Company’s controls and other procedures that are designed to
ensure that information required to be disclosed by the Company in the reports
that the Company files or submits under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the Securities and
Exchange Commission’s rules and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed by the Company in the reports that it files
under the Exchange Act is accumulated and communicated to the Company’s
management, including its Chief Executive Officer and Chief Financial Officer,
as appropriate to allow timely decisions regarding required disclosure.
Management is responsible for establishing and maintaining adequate internal
control over financial reporting.
  Under the
supervision and with the participation of our management, including our
principal executive officer and principal financial officer, we conducted an
evaluation of our disclosure controls and procedures, as such term is defined
under Rule 13a-14(c) promulgated under the Exchange Act as of March 31, 2009,
and, based on their evaluation, as of the end of such period, the our disclosure
controls and procedures were effective as of the end of the period covered by
the Quarterly Report,
  (b) Management’s
Report On Internal Control Over Financial Reporting. It is management’s
responsibilities to establish and maintain adequate internal controls over the
Company’s financial reporting. Internal control over financial reporting is
defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a
process designed by, or under the supervision of, the issuer’s principal
executive and principal financial officers and effected by the issuer’s
management and other personnel, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles and includes those policies and procedures that:
 
 •           Pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of the assets of the issuer;
and
 
 •           Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles and that receipts and expenditures of the issuer are being
made only in accordance with authorizations of management of the issuer;
and
 
 •           Provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the issuer’s assets that could have a
material effect on the financial statements.
 
 As of the
end of the period covered by the Quarterly Report, an evaluation was carried out
under the supervision and with the participation of our management, including
our Chief Executive Officer and Chief Financial Officer, of the effectiveness of
our internal control over financial reporting.
  Management
assessed the effectiveness of our internal control over financial reporting as
of March 31, 2009. In making this assessment, management used the criteria set
forth by the Committee of Sponsoring Organizations of the Treadway Commission in
Internal Control-Integrated Framework.
  Based on
that evaluation, our Chief Executive Officer and Chief Financial Officer have
concluded that, as of the end of such period, internal controls over financial
reporting were effective as of the end of the period covered by the
Report.
  Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate. All internal control systems, no matter
how well designed, have inherent limitations. Therefore, even those systems
determined to be effective can provide only reasonable assurance with respect to
financial statement preparation and presentation. Because of the inherent
limitations of internal control, there is a risk that material misstatements may
not be prevented or detected on a timely basis by internal control over
financial reporting. However, these inherent limitations are known features of
the financial reporting process. Therefore, it is possible to design into the
process safeguards to reduce, though not eliminate, this risk.
  This
Quarterly Report does not include an attestation report of our registered public
accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by our registered public
accounting firm pursuant to temporary rules of the Securities and Exchange
Commission that permit us to provide only management’s report in this Quarterly
Report.
  (c) Changes in
internal control over financial reporting. There were no changes in our
internal control over financial reporting identified in connection with the
evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that
occurred during our last fiscal quarter that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
 
 14
 Table
of Contents
  PART II.  OTHER
INFORMATION
 
 ITEM
1.      LEGAL PROCEEDINGS
 
 As of the
date of this report, we are not a party to any pending legal proceeding and are
not aware of any threatened legal proceeding.
 
 ITEM
1A.   RISK FACTORS
 
 In addition to the other information set forth in
this report, you should carefully consider the following factors, which could
materially affect our business, financial condition or future results. The risks
described below are not the only risks facing us. Additional risks and
uncertainties not currently known to us or that we currently deems to be
immaterial also may materially adversely affect our business, financial
condition or results of operations.
  BECAUSE
WE HAVE A LIMITED OPERATING HISTORY AND NEAR ABSENCE OF REVENUES, EVALUATING OUR
BUSINESS AND PROSPECTS MAY BE DIFFICULT.
  While our
competitors have operated real estate businesses for a significant period of
time, we have only had limited operations and a near absence of revenues since
our inception in September 2004. As a result, we have a limited operating
history upon which you can evaluate us and our prospects. In addition, we have
an accumulated deficit of $1,269,520 since inception through March 31, 2009.
These uncertainties increase the risk that you may lose your
investment.
  WE
DO NOT EXPECT TO PAY DIVIDENDS ON OUR COMMON STOCK, THUS YOU MAY NEVER RECEIVE A
RETURN ON YOUR INVESTMENT IN OUR COMMON STOCK.
 
 To date,
we have not paid any dividends on our common stock. We do not anticipate paying
any cash dividends on our common stock in the foreseeable future. Any payment of
future dividends and the amounts thereof will depend upon our earnings,
financial requirements and other factors deemed relevant by our board of
directors. Thus, there is a greater risk you may never receive a return on your
investment in our common stock.
 
 THERE
IS NO TRADING MARKET FOR OUR SHARES OF COMMON STOCK, AND YOU MAY BE UNABLE TO
SELL YOUR SHARES.
  There is
not, and has never has been, a trading market for our securities. There is no
established public trading market or market maker for our securities. There can
be no assurance that a trading market for our common stock will be established
or that, if established, can be sustained. Thus, there is a risk that you may
never be able to sell your shares.
  OUR
LACK OF AN ESTABLISHED BRAND NAME AND RELATIVE LACK OF RESOURCES COULD DECREASE
OUR ABILITY TO COMPETE IN THE REAL ESTATE MARKET EFFECTIVELY.
  We do not
have an established brand name or reputation in the residential real estate
business. We also have a relative lack of resources to conduct our business
operations. Thus, we may have difficulty effectively competing with companies
that have greater name recognition and resources than we do. Presently, we have
no patents, copyrights, trademarks and/or service marks that would protect our
brand name or our proprietary information, nor do we have any current plans to
file applications for such rights. Our inability to promote and/or protect our
brand name may decrease our ability to compete effectively in the residential
real estate market.
  WE
HAVE SUBSTANTIAL NEAR-TERM CAPITAL NEEDS; WE MAY BE UNABLE TO OBTAIN THE
ADDITIONAL FUNDING NEEDED TO ENABLE US TO OPERATE PROFITABLY IN THE FUTURE AND
MAY BE REQUIRED TO CURTAIL OPERATIONS OR SHUT DOWN COMPLETELY.
 
 We will
need additional funding over the next twelve months to develop our business. The
estimated need for funds could be as little as $45,000 or as high as $1,000,000,
depending on the properties we plan to acquire and the maintenance of current
facilities. Please note that the $45,000 amount above consists of $25,000 in
cash to purchase such properties as discussed in more detail in this paragraph
plus $20,000 which covers additional expense related to our newly acquired
reporting obligation. For instance, if we can purchase a property with as little
money down, such as low as 5% for illustrative purposes, then we would only
require the low end of the above range, or about $25,000 in cash, exclusive of
the $20,000 which covers the expense of our newly acquired reporting obligation,
to purchase such property costing $500,000 for illustrative purposes. On the
other hand, if we purchase a property with only cash and without borrowing, then
we would spend as much as $500,000 on the same purchase in the illustration
above. If two of these properties are purchased with no borrowings, then we
would spend $1,000,000 as an example. In addition, much depends of the quality
of the property. For example, the property may require significant expenditures
to obtain a certificate of occupancy for it. As of March 31, 2009, we had $76 in
liquid assets with which to pay our expenses. Accordingly, we will seek outside
sources of capital such as conventional bank financing; however, there can be no
assurance that we will be able to obtain favorable terms for such financing. If
adequate funds are not available, we may be required to curtail operations or
shut down completely.
 
 WE
MAY NEED TO ISSUE MORE STOCK, WHICH COULD DILUTE YOUR STOCK
 
 If we do
not have enough capital to meet our future capital requirements, we may need to
conduct additional capital-raising in order to continue our operations. To the
extent that additional capital is raised through the sale of equity and/or
convertible debt securities, the issuance of such securities could result in
dilution to our shareholders and/or increased debt service commitments.
Accordingly, if we issue additional stock, it could reduce the value of your
stock.
  OUR
PRINCIPAL STOCKHOLDER CONTROLS OUR BUSINESS AFFAIRS, SO YOU WILL HAVE LITTLE OR
NO PARTICIPATION IN OUR BUSINESS AFFAIRS.
 
 Currently,
our principal stockholder, Duane Bennett, owns approximately 61.18% of our
common stock. Most of this stock is held by the Northeast Nominee Trust. Duane
Bennett is the sole trustee of this trust. As a result, he will have control
over all matters requiring approval by our stockholders and can outvote all
minority stockholders. In addition, he will be able to elect all of the members
of our Board of Directors, which will allow him to significantly control our
affairs and management. He will also be able to affect most corporate matters
requiring stockholder approval by written consent, without the need for a duly
noticed and duly-held meeting of stockholders. Accordingly, you will be limited
in your ability to effect change in how we conduct our business.
 
 IF
WE LOSE THE SERVICES OF OUR KEY DIRECTOR, OUR BUSINESS COULD LOSE MONEY OR SHUT
DOWN COMPLETELY.
 
 Our
success is heavily dependent upon the continued active participation of our key
director, Duane Bennett. Mr. Bennett has twenty years of experience in the real
estate business selling, buying and renovating multifamily homes in the
Springfield, Massachusetts area and land development and buying and selling real
estate in the Massachusetts area. If we lost Mr. Bennett’s services, we could
lose money or shut down completely. We do not maintain "key person" life
insurance on Mr. Bennett. We do not have a written employment agreement with Mr.
Bennett. There can be no assurance that we will be able to recruit or retain
other qualified personnel, should it be necessary to do so.
 
 WE
DO NOT HAVE ANY PLANS TO HIRE ADDITIONAL PERSONNEL FOR AT LEAST THE NEXT TWELVE
MONTHS, WHICH MAY CAUSE SUBSTANTIAL DELAYS IN OUR OPERATIONS.
 
 Although
we plan to expand our business and operations, we have no plans to hire
additional personnel for at least the next twelve months. As we expand our
business there will be additional strains on our operations due to increased
cost. In addition, expanded operations of our business may create additional
demand for the time and services of our president, who currently devotes
approximately 10 hours per week to our business. We now only have the services
of our president to accomplish our current business and our planned expansion.
If our growth outpaces his ability to provide services and we do not hire
additional personnel, itmay substantially delay
our operations.
  WE
FACE INTENSE COMPETITION, WHICH PUTS US AT A COMPETITIVE DISADVANTAGE; IF WE ARE
UNABLE TO OVERCOME THESE COMPETITIVE DISADVANTAGES, WE MAY NEVER BECOME
PROFITABLE.
 
 We face
intense competition from companies engaged in similar businesses. We will
compete with numerous companies that lease or sell residential real estate both
over the Internet and via traditional forms of business. We anticipate that
competition will intensify within Internet distribution channels, which we do
not utilize. Many of our competitors have significantly greater customer bases,
operating histories, financial, technical, personnel and other resources than we
do, and may have established reputations for success in the real estate
industry. There can be no assurance that we will be able to compete effectively
in the highly competitive real estate industry. As a response to changes in the
competitive environment, we may from time to time make certain service,
marketing or supply decisions or acquisitions that could reduce our revenues,
increase our expenses, or alter our pricing in a way that would diminish or
prevent our profitability.
 
 WE
HAVE INCURRED LOSSES FROM OPERATIONS AND LIMITED CASH, WHICH RAISES SUBSTANTIAL
DOUBT AS TO WHETHER WE CAN CONTINUE AS A GOING CONCERN.
  As of
December 31, 2008, our accumulated deficit was $1,269,520. Our cash flows
provided by (used in) operations were $354 and $1,397 for the three months ended
March 31, 2009 and 2008, respectively. We have incurred losses from operations
and limited cash that raises substantial doubt as to whether we can continue as
a going concern.
  DECLINING
ECONOMIC CONDITIONS COULD NEGATIVELY IMPACT OUR BUSINESS
  Our
operations are affected by local, national and worldwide economic
conditions.  Markets in the United States and elsewhere have been
experiencing extreme volatility and disruption for more than 12 months, due in
part to the financial stresses affecting the liquidity of the banking system and
the financial markets generally.  In recent weeks, this volatility and
disruption has reached unprecedented levels.  The consequences of a
potential or prolonged recession may include a lower level of economic activity
and uncertainty regarding energy prices and the capital and commodity markets.
While the ultimate outcome and impact of the current economic conditions cannot
be predicted, a lower level of economic activity might result in a decline in
energy consumption, which may adversely affect the price of oil, liquidity and
future growth.  Instability in the financial markets, as a result of
recession or otherwise, also may affect the cost of capital and our ability to
raise capital.
 
 15
 Table
of Contents
  ITEM
2.      UNREGISTERED SALES OF EQUITY SECURITIES AND USE
OF PROCEEDS
 
 We have
not had any unregistered sales of equity securities in the first quarter of
2009.
 
 ITEM
3.      DEFAULTS UPON SENIOR SECURITIES
 
 We have
not had any default upon senior securities.
 
 ITEM
4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS
 
 We have
not had any submission of matters to a vote of security holders.
 
 ITEM
5.      OTHER INFORMATION
 
 We do not
have any other information to report.
 
 ITEM
6.      EXHIBITS
 
 31.1 CEO Certification Pursuant to Section
302
 31.2 CFO
Certification Pursuant to Section 302(included in Exhibit
31.1)
 32.1
CEO Certification
Pursuant to Section 906
 32.2 CFO
Certification Pursuant to Section 906(included in Exhibit
32.1)
 
 Reports on Form8-K
 
 None
 
 16
 Table
of Contents
  SIGNATURES
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
  BLUESKY
      SYSTEMS CORPORATION
                (Registrant)Date:
      May 15, 2009
              By:
              /s/
      Duane BennettDuane
      Bennett
                President,
      Chief Executive Officer, and
                Chief
      Financial Officer