MORTGAGE NOTES PAYABLE

9 Months Ended

Sep. 30, 2013

MORTGAGE NOTES PAYABLE

MORTGAGE NOTES PAYABLE

NOTE 5. MORTGAGE NOTES PAYABLE

At September 30, 2013 and December 31, 2012, the mortgages payable consisted of various loans, all of which were secured by first mortgages on properties referred to in Note 2. At September 30, 2013, the interest rates on these loans ranged from 2.44% to 7.07%, payable in monthly installments aggregating approximately $791,000, including principal, to various dates through 2028. The majority of the mortgages are subject to prepayment penalties.  At September 30, 2013, the weighted average interest rate on the above mortgages was 4.84%. The effective rate of 4.98% includes the amortization expense of deferred financing costs. See Note 12 for fair value information. The Partnership’s mortgage debt and the mortgage debt of its unconsolidated joint ventures generally is non-recourse except for customary exceptions pertaining to misuse of funds and material misrepresentations.

The Partnership has pledged tenant leases as additional collateral for certain of these loans.

Approximate annual maturities at September 30, 2013 are as follows:

2014—current maturities	$	1,825,000
2015	9,127,000
2016	945,000
2017	1,889,000
2018	9,158,000
Thereafter	169,030,000
	$	191,974,000

The table reflects the refinancing of Westgate Woburn and Hamilton Green Apartments as described below.

On February 25, 2013, the Partnership paid off the mortgage of approximately $3,697,000 on Hamilton Cypress LLC. There was no penalty on the early payoff.  The funds used to pay off the mortgage were from the Partnerships cash reserves.

On March 11, 2013, the Partnership refinanced the property located at School Street.  The new loan is $15,000,000 with an interest rate of 3.7% due in 2023.  The loan calls for interest only for three years followed by principal and interest payments over the remainder of the loan term. The costs associated with this refinancing were approximately $159,000.

On July 7, 2013, Boylston Downtown LP, a wholly owned subsidiary of the Partnership, refinanced the property located at 62 Boylston Street, Boston, Massachusetts.  The new 15 year $40,000,000 mortgage has an interest rate of 3.97%.  The terms of the loan are interest only for the first three years, with a 30 year amortization thereafter until maturity in August 2028.  Approximately $19,500,000 of loan proceeds was used to pay off the existing mortgage.  The balance of the funds, approximately $20,000,000, after closing costs, was used in connection with the purchase of Hamilton Green Apartments.  The costs associated with this refinancing are approximately $279,000.

Westgate Apartments, LLC refinanced the property located at 2-20 Westgate Drive, Woburn, Massachusetts.  The refinancing was completed on October 1, 2013.  See Note 16 — Subsequent events.

On September 30, 2013, the Partnership received a commitment for a new mortgage on the Hamilton Green Apartments located in Andover, Massachusetts.  The new mortgage is $38,500,000, interest is fixed at 4.67% for 15 years, and payments are interest only for 2 years and include principal amortization, based on a 30 year schedule, thereafter.  The Partnership anticipates closing on this mortgage in the fourth quarter of 2013.  The Partnership anticipates that the closing costs associated with this new mortgage will be approximately $405,000. See Note 16 — Subsequent events.