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RENTAL PROPERTIES
 12 Months Ended
Dec. 31, 2013
RENTAL PROPERTIES  
RENTAL PROPERTIES

NOTE 2. RENTAL PROPERTIES

        As of December 31, 2013, the Partnership and its Subsidiary Partnerships owned 2,412 residential apartment units in 20 residential and mixed-use complexes (collectively, the "Apartment Complexes"). The Partnership also owns 19 condominium units in a residential condominium complex, all of which are leased to residential tenants (collectively referred to as the "Condominium Units"). The Apartment Complexes and Condominium Units are located primarily in the metropolitan Boston area of Massachusetts.

        Additionally, as of December 31, 2013, the Partnership and Subsidiary Partnerships owned a commercial shopping center in Framingham, commercial buildings in Newton and Brookline and mixed-use properties in Boston, Brockton and Newton, all in Massachusetts. These properties are referred to collectively as the "Commercial Properties."

        The Partnership also owned a 40% to 50% ownership interest in nine residential and mixed use complexes (the "Investment Properties") at December 31, 2013 with a total of 798 units, accounted for using the equity method of consolidation. See Note 14 for summary information on these investments.

        Rental properties consist of the following:

 
   December 31, 2013   December 31, 2012   Useful Life  

Land, improvements and parking lots

   $ 43,919,728   $ 27,743,726     15–40 years  

Buildings and improvements

     152,130,635     118,739,283     15–40 years  

Kitchen cabinets

     5,956,078     3,544,868     5–10 years  

Carpets

     5,820,516     3,218,975     5–10 years  

Air conditioning

     707,928     746,043     5–10 years  

Laundry equipment

     404,775     378,806     5–7 years  

Elevators

     1,139,296     1,139,296     20–40 years  

Swimming pools

     444,629     235,242     10–30 years  

Equipment

     5,038,530     1,529,904     5–7 years  

Motor vehicles

     86,657     101,657     5 years  

Fences

     24,670     22,445     5–15 years  

Furniture and fixtures

     5,564,621     1,031,348     5–7 years  

Smoke alarms

     216,223     193,298     5–7 years  
                 
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Total fixed assets

     221,454,286     158,624,893        

Less: Accumulated depreciation

     (68,549,625 )   (63,651,293 )      
                 
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

 

   $ 152,904,661   $ 94,973,600        
                 
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
                 

        Real estate and accumulated depreciation as of December 31, 2013 is:

 
    
   Initial Cost to
Partnerships(1)		   Cost
Capitalized
Subsequent to
Acquisition(2)		   Gross Amount at Which
Carried at Close of Period		    
    
  
 
   Encumbrances
(First
Mortgages)		    
   Buildings
Improvements		    
   Buildings
Improvements		    
   Accumulated
Depreciation(3)		    
  
 
   Land   Improvements   Land   Totals   Date Acquired  

Boylston Downtown L.P. Residential Apartments Boston, Massachusetts

   $ 40,000,000   $ 2,112,000   $ 8,593,111   $ 7,329,225   $ 2,112,000   $ 15,922,336   $ 18,034,336   $ 9,643,251     July 1995  

Brookside Associates LLC Residential Apartments Woburn, Massachusetts

  
$
2,684,432		  
$
684,000		  
$
3,116,000		  
$
489,922		  
$
684,000		  
$
3,605,922		  
$
4,289,922		  
$
1,755,296		    
Oct. 2000		  

Courtyard @ Westgate Residential Units Burlington, Massachusetts

  
$
2,000,000		  
$
44,965		  
$
4,478,687		  
$
249,954		  
$
44,965		  
$
4,728,641		  
$
4,773,606		  
$
1,643,418		    
Sep. 2004		  

Clovelly Apartments L.P. Residential Apartments Nashua, New Hampshire

  
$
4,160,000		  
$
177,610		  
$
1,478,359		  
$
1,503,424		  
$
177,610		  
$
2,981,783		  
$
3,159,393		  
$
2,067,556		    
Sept. 1977		  

Commonwealth 1137 L.P. Residential Apartments Boston, Massachusetts

  
$
3,750,000		  
$
342,000		  
$
1,367,669		  
$
983,064		  
$
342,000		  
$
2,350,733		  
$
2,692,733		  
$
1,346,509		    
July 1995		  

Commonwealth 1144 L.P. Residential Apartments Boston, Massachusetts

  
$
14,780,000		  
$
1,410,000		  
$
5,664,816		  
$
1,764,516		  
$
1,410,000		  
$
7,429,332		  
$
8,839,332		  
$
4,550,902		    
July 1995		  

Condominium Units—Riverside Residential Units Massachusetts

  
$
—		  
$
23,346		  
$
190,807		  
$
19,564		  
$
23,346		  
$
210,371		  
$
233,717		  
$
204,818		    
Sept. 1977		  

Executive Apartments L.P. Residential Apartments Framingham, Massachusetts

  
$
2,415,000		  
$
91,400		  
$
740,360		  
$
700,459		  
$
91,400		  
$
1,440,819		  
$
1,532,219		  
$
1,093,190		    
Sept. 1977		  

Hamilton Battle Green LLC Residential Apartments Lexington, Massachusetts

  
$
4,813,616		  
$
1,341,737		  
$
8,457,497		  
$
80,805		  
$
1,341,737		  
$
8,538,302		  
$
9,880,039		  
$
1,009,136		    
Jun. 2011		  

Hamilton Cypress LLC Commercial—1031Exchange Brookline, Massachusetts

  
$
—		  
$
2,362,596		  
$
4,613,985		  
$
348,345		  
$
2,362,596		  
$
4,962,330		  
$
7,324,926		  
$
876,537		    
Oct. 2008		  

Hamilton Green Apartments Residential Apartments Andover, Massachusetts

  
$
38,500,000		  
$
16,054,336		  
$
44,794,438		  
$
125,362		  
$
16,054,336		  
$
44,919,800		  
$
60,974,136		  
$
1,534,867		    
Jul. 2013		  

Hamilton Linewt LLC Commercial—1031Exchange Newton, Massachusetts

  
$
1,474,947		  
$
884,042		  
$
2,652,127		  
$
50,608		  
$
884,042		  
$
2,702,735		  
$
3,586,777		  
$
422,799		    
Nov. 2007		  

Hamilton Oaks Associates LLC Residential Apartments Brockton, Massachusetts

  
$
11,925,000		  
$
2,175,000		  
$
12,325,000		  
$
1,898,324		  
$
2,175,000		  
$
14,223,324		  
$
16,398,324		  
$
7,684,626		    
Dec. 1999		  

Highland Street Apartments, L.P. Residential Apartments Lowell, Massachusetts

  
$
1,050,000		  
$
156,000		  
$
634,085		  
$
387,455		  
$
156,000		  
$
1,021,540		  
$
1,177,540		  
$
592,810		    
Dec. 1996		  

Linhart L.P. Residential/Commercial Newton, Massachusetts

  
$
1,929,123		  
$
385,000		  
$
1,540,000		  
$
1,239,887		  
$
385,000		  
$
2,779,887		  
$
3,164,887		  
$
1,845,936		    
Jan. 1995		  

Nashoba Apartments L.P. Residential Apartments Acton, Massachusetts

  
$
—		  
$
—		  
$
—		  
$
—		  
$
—		  
$
—		  
$
—		  
$
—		    
Sold May13
Sept. 1977		  

NERA Dean St. Associates LLC Residential Apartments Norwood, Massachusetts

  
$
5,113,360		  
$
1,512,000		  
$
5,701,480		  
$
561,752		  
$
1,512,000		  
$
6,263,232		  
$
7,775,232		  
$
2,685,523		    
Jun. 2002		  

North Beacon 140 L.P. Residential Units Boston, Massachusetts

  
$
6,937,000		  
$
936,000		  
$
3,762,013		  
$
1,588,914		  
$
936,000		  
$
5,350,927		  
$
6,286,927		  
$
3,295,988		    
July 1995		  

Olde English Apartments L.P. Residential Apartments Lowell, Massachusetts

  
$
3,080,000		  
$
46,181		  
$
878,323		  
$
1,252,182		  
$
46,181		  
$
2,130,505		  
$
2,176,686		  
$
1,374,075		    
Sept. 1977		  

River Drive L.P. Residential Apartments Danvers, Massachusetts

  
$
3,465,000		  
$
72,525		  
$
587,777		  
$
729,271		  
$
72,525		  
$
1,317,048		  
$
1,389,573		  
$
926,978		    
Sept. 1977		  

Redwood Hills L.P. Residential Units Worcester, Massachusetts

  
$
6,743,000		  
$
1,200,000		  
$
4,810,604		  
$
2,285,268		  
$
1,200,000		  
$
7,095,872		  
$
8,295,872		  
$
4,190,382		    
July 1995		  

School St Assoc LLC Residential Apartments Framingham, Massachusetts

  
$
15,000,000		  
$
4,686,728		  
$
18,746,911		  
$
(1,997,252
)
$
4,686,728		  
$
16,749,659		  
$
21,436,387		  
$
6,647,588		    
Apr. 2003		  

Staples Plaza Strip Mall Framingham, Massachusetts

  
$
6,000,000		  
$
3,280,000		  
$
4,920,000		  
$
46,847		  
$
3,280,000		  
$
4,966,847		  
$
8,246,847		  
$
2,403,966		    
May 1999		  

WCB Associates LLC Residential Apartments Brockton, Massachusetts

  
$
7,000,000		  
$
1,335,000		  
$
7,565,501		  
$
1,017,996		  
$
1,335,000		  
$
8,583,497		  
$
9,918,497		  
$
4,756,907		    
Dec. 1999		  

Westgate Apartments LLC Residential Apartments Woburn, Massachusetts

  
$
15,700,000		  
$
461,300		  
$
2,424,636		  
$
7,024,635		  
$
417,107		  
$
9,449,271		  
$
9,866,378		  
$
5,996,569		    
Sept. 1977		  
                                         
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

 

  
$
198,520,478		  
$
41,773,766		  
$
150,044,186		  
$
29,680,527		  
$
41,729,573		  
$
179,724,713		  
$
221,454,286		  
$
68,549,627		        
                                         
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
                                         
(1)
The initial cost to the Partnerships represents both the balance of mortgages assumed in September 1977, including subsequent adjustments to such amounts, and subsequent acquisitions at cost.

(2)
Net of retirements, which are not significant.

(3)
In 2013, rental properties were depreciated over the following estimated useful lives:

Assets
  Life  
Buildings and Improvements     10-39 years  
Other Categories of Assets     5-10 years  

        A reconciliation of rental properties and accumulated depreciation is as follows:

 
   December 31,  
 
   2013   2012   2011  

Rental Properties

                    

Balance, Beginning

   $ 158,624,893   $ 159,123,799   $ 150,818,648  

Additions:

                    

Buildings, improvements and other assets

     65,349,698     2,360,399     12,444,604  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

 

     223,974,591     161,484,198     163,263,252  

Deduct:

                    

Write-off of retired or disposed assets

     2,505,787     1,607,830     2,437,555  

Rental properties held for sale and/or sold

     14,518     1,251,475     1,701,898  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Balance, Ending

   $ 221,454,286   $ 158,624,893   $ 159,123,799  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
               

Accumulated Depreciation

                    

Balance, Beginning

   $ 63,651,293   $ 60,199,265   $ 58,074,391  

Add:

                    

Depreciation for the year

     7,404,120     5,849,083     5,750,989  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

 

     71,844,630     66,048,348     63,825,380  

Deduct:

                    

Accumulated depreciation of retired or disposed assets

     2,505,787     1,607,830     2,437,555  

Accumulated depreciation of rental properties held for sale and/or sold

     —     789,225     1,188,560  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Balance, Ending

   $ 68,549,625   $ 63,651,293   $ 60,199,265  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
               

        On May 18, 2011, the Partnership sold Avon Street Apartments, a 66 unit residential apartment complex located at 130 Avon Street, Malden, Massachusetts. The sales price was $8,750,000, which resulted in a gain of approximately $7,700,000. The net proceeds of the sale, of approximately $5,444,000 were held by a qualified intermediary in order for the Partnership to structure a tax free exchange in accordance with Section 1031 of the IRS code. This tax free exchange was completed with the purchase of Battle Green Apartments described below.

        On June 1, 2011, the Partnership purchased Battle Green Apartments, a 48 unit residential apartment complex located at 34-42 Worthen Road, Lexington, Massachusetts. The purchase price was $10,000,000. The Partnership used cash reserves, the proceeds from the sale of Avon Street and borrowed $3,998,573 from Harold Brown, Treasurer of the General Partner to make this purchase. This loan had an interest rate of 6% and was secured by the Partnership's ownership interest in Battle Green Apartments, LLC. The term of the loan is four years with a provision requiring payment in whole or in part upon demand within six months of notice or prepay without penalty. On July 27, 2011, the Partnership financed Battle Green Apartments with a new $5,000,000 mortgage at 4.95% which matures in August 2026. Principal payments will be made using a 30 year amortization schedule. Deferred financing costs associated with this mortgage totaled approximately $100,000 and accordingly the effective interest rate is 5.07%. After paying off the existing loan of $3,998,573, approximately $1,000,000 was received by the Partnership. The interest paid on this loan to Harold Brown in 2011 was $38,123.

        In May 2013 the Partnership sold the Nashoba Apartments located in Acton, Massachusetts. The sale price was $4,300,000; the net proceeds of approximately $2,100,000 were transferred to Investment Property Exchange Services, Inc. a Qualified Intermediary. These funds were held by the intermediary in order to maintain the Partnership's ability to structure a tax free exchange in accordance with the Internal Revenue Service's rules under Sec. 1031. The gain on the sale in accordance with GAAP is approximately $3,679,000. The proceeds were subsequently used in the acquisition of the Hamilton Green Apartments described below.

        On July 15, 2013, Hamilton Green Apartments, LLC, ("Hamilton Green") a newly formed subsidiary of the Partnership, purchased Windsor Green at Andover, a 193 unit apartment complex located at 311 and 319 Lowell Street, Andover, Massachusetts. The purchase price was $62,500,000. From the purchase price, the Partnership has allocated approximately $1,656,000 to the value of the in-place leases and approximately $96,000 to the value of the tenant relationships. These amounts will be amortized over 12 and 36 months respectively. To fund this purchase, the Partnership obtained short term financing of approximately $40,000,000, used the funds of approximately $2,100,000 from the sale of the Nashoba Apartments, and the balance from the Partnership's cash reserves. The closing costs associated with this short term financing were approximately $38,000. The original mortgage matured in November 2013. On December 20, 2013, the Partnership refinanced the mortgage on Hamilton Green. The new mortgage is $38,500,000, interest is fixed at 4.67% for 15 years, interest only for 2 years and the mortgage is amortized over 30 years. This refinancing required additional capital of approximately $1,846,000 from the Partnership. The closing costs associated with this refinancing were approximately $346,000.