10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549   

FORM 10-K

(Mark One)
☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2017
OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                          to

Commission file number 001‑31568

New England Realty Associates Limited Partnership

(Exact name of registrant as specified in its charter)

Massachusetts (State or other jurisdiction of incorporation or organization)	04‑2619298 (I.R.S. employer identification no.)
39 Brighton Avenue, Allston, Massachusetts (Address of principal executive offices)	02134 (Zip Code)
Registrant’s telephone number, including area code: (617) 783‑0039
Securities registered pursuant to Section 12(b) of the Act:
Depositary Receipts (Title of each Class)	NYSE MKT (Name of each Exchange on which Registered)
Securities registered pursuant to Section 12(g) of the Act:
Class A Limited Partnership Units (Title of class)

Indicate by check mark if the registrant is a well‑known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐  No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐  No ☒

Indicate by check mark whether the registrant (1) has 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 ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 ☒   No ☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S‑K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10‑K or any amendments to this Form 10-K ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ◻	Accelerated filer ☒	Non-accelerated filer ◻	Smaller reporting company ◻
		(Do not check if a smaller reporting company)	Emerging growth company ◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act). Yes ☐  No ☒

At June 30, 2017, the aggregate market value of the registrant’s securities held by non‑affiliates of the registrant was $158,399,885  based on the closing price of the registrant’s traded securities on the NYSE MKT Exchange on such date. For this computation, the Registrant has excluded the market value of all Depositary Receipts reported as beneficially owned by executive officers and directors of the General Partner of the Registrant; such exclusion shall not be deemed to constitute an admission that any such person is an affiliate of the Registrant.

As of March 1, 2018, there were 99,509  of the registrant’s Class A units (2,985,282 Depositary Receipts) of limited partnership issued and outstanding and 23,633 Class B units issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE: None.

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP

TABLE OF CONTENTS

		PAGE
PART I
Item 1.	Business	3
Item 1A.	Risk Factors	7
Item 1B.	Unresolved Staff Comments	11
Item 2.	Properties	11
Item 3.	Legal Proceedings	19
Item 4.	Mine Safety Disclosure	19
PART II
Item 5.	Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	19
Item 6.	Selected Financial Data	22
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 8.	Consolidated Financial Statements and Supplementary Data	36
Item 9.	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure	36
Item 9A.	Controls and Procedures	36
Item 9B.	Other Information	37
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	37
Item 11.	Executive Compensation	40
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	41
Item 13.	Certain Relationships and Related Transactions, and Director Independence	43
Item 14.	Principal Accounting Fees and Services	44
PART IV
Item 15.	Exhibits and Financial Statement Schedules	44
Exhibit Index		S-1
SIGNATURES		S-4

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NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP

PART I

ITEM 1.  BUSINESS

General

New England Realty Associates Limited Partnership (“NERA” or the “Partnership”), a Massachusetts Limited Partnership, was formed on August 12, 1977 as the successor to five real estate limited partnerships (collectively, the “Colonial Partnerships”), which filed for protection under Chapter XII of the Federal Bankruptcy Act in September 1974. The bankruptcy proceedings were terminated in late 1984. In July 2004, the General Partner extended the termination date of the Partnership until 2057, as allowed in the Partnership Agreement.

The authorized capital of the Partnership is represented by three classes of partnership units (“Units”). There are two categories of limited partnership interests (“Class A Units” and “Class B Units”) and one category of general partnership interests (the “General Partnership Units”). The Class A Units were initially issued to creditors and limited partners of the Colonial Partnerships and have been registered under Section 12(g) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Each Class A Unit is exchangeable for 30 publicly traded depositary receipts (“Receipts”), which are currently listed on the NYSE American and are registered under Section 12(b) of the Exchange Act. The Class B Units were issued to the original general partners of the Partnership. The General Partnership Units are held by the current general partner of the Partnership, NewReal, Inc. (the “General Partner” or “New Real”). The Class A Units represent an 80% ownership interest, the Class B Units represent a 19% ownership interest, and the General Partnership Units represent a 1% ownership interest.

The Partnership is engaged in the business of acquiring, developing, holding for investment, operating and selling real estate. The Partnership, directly or through 26 subsidiary limited partnerships or limited liability companies, owns and operates various residential apartment buildings, condominium units and commercial properties located in Massachusetts and New Hampshire. As used herein, the Partnership’s subsidiary limited partnerships and limited liabilities companies are each referred to as a “Subsidiary Partnership” and are collectively referred to as the “Subsidiary Partnerships.”

The Partnership owns between a 99.67% and 100% interest in each of the Subsidiary Partnerships, except in nine limited liability companies (the “Investment Properties” or “Joint Ventures”) in which the Partnership has between a 40% and 50% ownership interest. The majority shareholder of the General Partner indirectly owns between 43.2% and 56%, the President of Hamilton owns between 2.5 % and 4.5 %, and five other management employees of Hamilton own collectively between 0% and 3.3%, respectively of Joint Ventures. The Partnership’s interest in the Investment Properties is accounted for on the equity method in the Consolidated Financial Statements. See Note 1 to the Consolidated Financial Statements—“Principles of Consolidation.” See Note 14 to the Consolidated Financial Statements—“Investment in Unconsolidated Joint Ventures” for a description of the properties and their operations. Of those Subsidiary Partnerships not wholly owned by the Partnership, except for the Investment Properties, the remaining ownership interest is held by an unaffiliated third party. In each such case, the third party has entered into an agreement with the Partnership, pursuant to which any benefit derived from its ownership interest in the applicable Subsidiary Partnerships will be returned to the Partnership.

The long‑term goals of the Partnership are to manage, rent and improve its properties and to acquire additional properties with income and capital appreciation potential as suitable opportunities arise. When appropriate, the Partnership may sell or refinance selected properties. Proceeds from any such sales or refinancing will be used to reduce debt, reinvested in acquisitions of other properties, distributed to the partners, repurchase equity interests, or used for operating expenses or reserves, as determined by the General Partner.

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Operations of the Partnership

The Partnership is managed by the General Partner, NewReal, Inc., a Massachusetts corporation wholly owned by Harold Brown and Ronald Brown. The General Partner has engaged The Hamilton Company, Inc. (the “Hamilton Company” or “Hamilton”) to perform general management functions for the Partnership’s properties in exchange for management fees. The Hamilton Company is wholly owned by Harold Brown and employs Ronald Brown and Harold Brown. The Partnership, Subsidiary Partnerships, and the Investment Properties currently contract with the management company for 53 individuals at the Properties and 15 individuals at the Joint Ventures who are primarily involved in the supervision and maintenance of specific properties. The General Partner has no employees.

As of February 1, 2018, the Partnership and its Subsidiary Partnerships owned 2,632  residential apartment units in 22 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, the Condominium Units and the Investment Properties are located primarily in the metropolitan Boston area of Massachusetts.

As of February 1, 2018, the Subsidiary Partnerships also owned a commercial shopping center in Framingham, Massachusetts, one commercial building in Newton and one in Brookline, Massachusetts and commercial space in mixed‑use buildings in Boston, Brockton and Newton, Massachusetts. These properties are referred to collectively as the “Commercial Properties.” See Note 2 to the Consolidated Financial Statements, included as a part of this Form 10‑K.

Additionally, as of February 1, 2018, the Partnership owned a 40‑50% interest in 8 residential and mixed use complexes, the Investment Properties, with a total of  722 residential units, one commercial unit, and a 50 car parking lot. See Note 14 to the Consolidated Financial Statements for additional information on these investments.

The Apartment Complexes, Investment Properties, Condominium Units and Commercial Properties are referred to collectively as the “Properties.”

Harold Brown and, in certain cases, Ronald Brown, and officers and employees of the Hamilton Company own or have owned interests in certain of the Properties, Subsidiary Partnerships and Joint Ventures. See “Item 13. Certain Relationships, Related Transactions and Director Independence.”

The leasing of real estate in the metropolitan Boston area of Massachusetts is highly competitive. The Apartment Complexes, Condominium Units and the Investment Properties must compete for tenants with other residential apartments and condominium units in the areas in which they are located. The Commercial Properties must compete for commercial tenants with other shopping malls and office buildings in the areas in which they are located. Thus, the level of competition at each Property depends on how many other similarly situated properties are in its vicinity. In addition to Item 1A, Risk Factors, See “Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations—Factors that May Affect Future Results.”

The Second Amended and Restated Contract of Limited Partnership of the Partnership (the “Partnership Agreement”) authorizes the General Partner to acquire real estate and real estate related investments from or in participation with either or both of Harold Brown and Ronald Brown, or their affiliates, upon the satisfaction of certain terms and conditions, including the approval of the Partnership’s Advisory Committee and limitations on the price paid by the Partnership for such investments. The Partnership Agreement also permits the Partnership’s limited partners and the General Partner to make loans to the Partnership, subject to certain limitations on the rate of interest that may be charged to the Partnership. Except for the foregoing, the Partnership does not have any policies prohibiting any limited partner, General Partner or any other person from having any direct or indirect pecuniary interest in any investment to be acquired or disposed of by the Partnership or in any transaction to which the Partnership is a party or has an interest in or from engaging, for their own account, in business activities of the types conducted or to be conducted by the Partnership. The General Partner is not limited in the number or amount of mortgages which may be placed on any Property, nor is there a policy limiting the percentage of Partnership assets which may be invested in any specific Property.

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Industry Segments

The Partnership operates in only one industry segment—real estate. The Partnership does not have any foreign operations, and its business is not seasonal. See the Consolidated Financial Statements attached hereto and incorporated by reference herein for financial information relating to our industry segment.

Unit Distributions

In January 2018, the Partnership approved  a quarterly distribution of $9.00 per Unit ($0.30 per Receipt), payable on March 31, 2018. In 2017 the Partnership paid a total distribution of an aggregate $64.50 per Unit ($2.15 per Receipt) for a total payment of $7,985,835 in 2017. In 2016, the Partnership paid a total distribution of an aggregate of $54.00 per Unit ($1.80 per Receipt) for a total payment of $6,729,679.

On August 20, 2007, NewReal, Inc.,the General Partner authorized an equity repurchase program (“Repurchase Program”) under which the Partnership was permitted to purchase, over a period of twelve months, up to 300,000 Depositary Receipts (each of which is one‑tenth of a Class A Unit). Over time, the General Partner has authorized increases in the equity repurchase program. On March 10, 2015, the General Partner authorized an increase in the Repurchase Program to 2,000,000 Depository Receipts and extended the Program for an additional five years from March 31, 2015 until March 31, 2020. The Repurchase Program requires the Partnership to repurchase a proportionate number of Class B Units and General Partner Units in connection with any repurchases of any Depositary Receipts by the Partnership based upon the 80%, 19% and 1% fixed distribution percentages of the holders of the Class A, Class B and General Partner Units under the Partnership’s Second Amended and Restate Contract of Limited Partnership. Repurchases of Depositary Receipts or Partnership Units pursuant to the Repurchase Program may be made by the Partnership from time to time in its sole discretion in open market transactions or in privately negotiated transactions. From August 20, 2007 through December 31, 2017, the Partnership has repurchased 1,365,306 Depositary Receipts at an average price of $27.14 per receipt (or $814.20 per underlying Class A Unit), 3,072 Class B Units and 162 General Partnership Units, both at an average price of $ 926.26 per Unit, totaling approximately $40,274,000 including brokerage fees paid by the Partnership. 

Property Transactions

On July 6, 2017, Woodland Park Partners, LLC, ( “Woodland Park”) a newly formed subsidiary of the Partnership, purchased the Woodland Park Apartments, a 126-unit apartment complex located at 264-290 Grove Street, Newton, Massachusetts , for a purchase price of $45,600,000. The closing costs were approximately $64,000. To fund the purchase price, the Partnership borrowed $25,000,000 under its outstanding line of credit with KeyBank, NA, and $16,000,000 from HBC Holdings, LLC, a Massachusetts limited liability company controlled by Harold Brown. The loan from HBC Holdings had a maturity date of July 16, 2018, with interest only at 4.75%.  The balance of the purchase price was funded by the Partnership’s cash reserves. From the purchase price, the Partnership allocated approximately $541,000 for in-place leases, and approximately $42,000 to the value of tenant relationships. These amounts are being amortized over 12 and 24 months respectively. The loan from HBC was paid off on September 29, 2017 from the proceeds from new long term financing from Keybank. The total interest paid for the HBC loan was approximately $182,000. The Line of Credit was paid down by $8,000,000 on October 5, 2017.

On August 3, 2016, Hamilton Green Apartments, LLC sold a single family house contiguous with its apartment complex in Andover, Massachusetts.  The sale price of the property was $1,000,000 with closing costs of $227,663 and a cost basis of $668,544 resulting in a gain on the sale of $104,443.  Included in the closing costs is a mortgage prepayment penalty of $187,905.  The proceeds from the sale were used to reduce the principal amount on the apartment complex’s mortgage.

On September 18, 2015, Residences at Captain Parkers LLC, a newly formed subsidiary of the Partnership, purchased the Residence at Captain Parkers, a 94 unit apartment complex located at 125 Worthen Road and Ryder Lane in Lexington, Massachusetts. The purchase price was $31,600,000 and the closing costs were approximately $49,000. From the purchase price, the Partnership allocated approximately $474,000 for in-place leases, and approximately $31,000 to the value of tenant relationships. These amounts are being amortized over 12 and 24 months respectively. To

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fund the purchase, the Partnership utilized the available line of credit of $25,000,000, and the balance from the Partnership’s cash reserves.

During 2017, the Partnership and its Subsidiary Partnerships completed improvements to certain of the Properties at a total cost of approximately $5,795,000. These improvements were funded from cash reserves and, to some extent, escrow accounts established in connection with the financing or refinancing of the applicable Properties. These sources have been adequate to fully fund improvements. The most significant improvements were made at 1144 Commonwealth Apartments, Redwood Hills, 62 Boylston Street, School Street 9 Associates, Woodland Park and Westside Colonial,  at a cost of $949,000, $662,000, $635,000, $626,000, $542,000, and $406,000 respectively. The Partnership plans to invest approximately $3,447,000in capital improvements in 2018.

During 2017, three Joint Venture Partnerships sold units at a gain of approximately $6,141,000. Hamilton 1025 LLC sold 20 units with a gain on the sales of approximately $2,380,000, Hamilton Bay Apartments sold 29 units at a gain of approximately $3,628,000, and Hamilton Bay LLC sold one unit with a gain on the sale of approximately $133,000.

Line of Credit 

On July 31, 2014, the Partnership entered into an agreement for a $25,000,000 revolving line of credit.  The term of the line was for three years with a floating interest rate equal to a base rate of the greater of (a) the Prime Rate (b) the Federal Funds Rate plus one-half of one percent per annum, or (c) the LIBOR Rate for a period of one month plus 1% per annum, plus the  applicable margin of 2.5%. The agreement originally expired on July 31, 2017, and was extended until October 31, 2020. The costs associated with the line of credit extension were approximately $128,000.  As of December 31, 2017, the credit line had an outstanding balance of $17,000,000.

On July 6, 2017, the credit line had an outstanding balance of $25,000,000, which was drawn down in its’ entirety and was used  in conjunction with a loan of $16,000,000 from HBC Holdings, LLC, a Massachusetts Limited Liability company controlled by Harold Brown, and cash reserves, to purchase Woodland Park Partners, LLC (“Woodland Park”).

On September 29, 2017, Woodland Park Partners, LLC entered into a Multifamily Loan and Security Agreement with KeyBank National Association. As a result of securing the financing, the Partnership used the proceeds of the loan to pay off the loan from HBC Holdings, LLC. The Line of Credit was paid down by $8,000,000 on October 5, 2017 with both proceeds form the financing and cash reserves of the Partnership.

On January 7, 2016, Captain Parker entered into a Multifamily Loan and Security Agreement with KeyBank National Association . As a result of securing the financing, the Partnership used the proceeds of the loan and cash reserves of the Partnership to pay down the Line of Credit to zero. A payment was made on January 7, 2016 for $23,000,000, and another payment for $2,000,000 was made on January 15, 2016.

The line of credit may be used for acquisition, refinancing, improvements, working capital and other needs of the Partnership. The line may not be used to pay distributions, make distributions or acquire equity interests of the Partnership.

The line of credit is collateralized by varying percentages of the Partnership’s ownership interest in 23 of its subsidiary properties and joint ventures. Pledged interests range from 49% to 100% of the Partnership’s ownership interest in the respective entities.

The Partnership paid fees to secure the line of credit. Any unused balance of the line of credit is subject to a fee ranging from 15 to 20 basis points per annum. The Partnership paid approximately $29,000 for the twelve months ended December 31, 2017.

The line of credit agreement has several covenants, such as providing cash flow projections and compliance certificates, as well as other financial information. The covenants include, but are not limited to the following: maintain a

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leverage ratio that does not exceed 65%; aggregate increase in indebtedness of the subsidiaries and joint ventures should not exceed $15,000,000; maintain a tangible net worth (as defined in the agreement) of a minimum of $150,000,000; a minimum ratio of net operating income to total indebtedness of at least 9.5%; debt service coverage ratio of at least 1.6 to 1, as well as other items. The Partnership is in compliance with these covenants as of December 31, 2017.  

Advisory Committee

The Advisory Committee members are limited partners Gregory Dube, Robert Nahigian, and David Ross. These Advisory Committee members are not affiliated with the General Partner. The Advisory Committee meets with the General Partner to review the progress of the Partnership, assist the General Partner with policy formation, review the appropriateness, timing and amount of proposed distributions, approve or reject proposed acquisitions and investments with affiliates, and advise the General Partner on various other Partnership affairs. Per the Partnership Agreement, the Advisory Committee has no binding power except that it must approve certain investments and acquisitions or sales by the Partnership from or with affiliates of the Partnership.

Available Information

The Partnership’s website is www.thehamiltoncompany.com. On its website, the Partnership makes available, free of charge, its annual reports on Form 10‑K, quarterly reports on Form 10‑Q, current reports on Form 8‑K and amendments to those reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended. These forms are made available as soon as reasonably practical after the Partnership electronically files or furnishes such materials to the Securities and Exchange Commission. Any shareholder may obtain copies of these documents, free of charge, by sending a request in writing to: Director of Investor Relations, New England Realty Associates Limited Partnership, 39 Brighton Avenue, Allston, MA 02134.

ITEM 1A.  RISK FACTORS

We are subject to certain risks and uncertainties as described below. These risks and uncertainties may not be the only ones we face; there may be additional risks that we do not presently know of or that we currently consider immaterial. All of these risks could adversely affect our business, financial condition, results of operations and cash flows. Our ability to pay distributions on, and the market price of, our equity securities may be adversely affected if any of such risks are realized. All investors should consider the following risk factors before deciding to purchase or sell securities of the Partnership.

We are subject to risks inherent in the ownership of real estate.  We own and manage multifamily apartment complexes and commercial properties that are subject to varying degrees of risk generally incident to the ownership of real estate. Our financial condition, the value of our properties and our ability to make distributions to our shareholders will be dependent upon our ability to operate our properties in a manner sufficient to generate income in excess of operating expenses and debt service charges, which may be affected by the following risks, some of which are discussed in more detail below:

· changes in the economic climate in the markets in which we own and manage properties, including interest rates, the overall level of economic activity, the availability of consumer credit and mortgage financing, unemployment rates and other factors;

· a lessening of demand for the multifamily and commercial units that we own;

· competition from other available multifamily residential and commercial units and changes in market rental rates;

· development by competitors of competing multi‑family communities;

· increases in property and liability insurance costs;

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· changes in real estate taxes and other operating expenses (e.g., cleaning, utilities, repair and maintenance costs, insurance and administrative costs, security, landscaping, pest control, staffing, snow removal and other general costs);

· changes in laws and regulations affecting properties (including tax, environmental, zoning and building codes, and housing laws and regulations);

· weather and other conditions that might adversely affect operating expenses;

· expenditures that cannot be anticipated, such as utility rate and usage increases, unanticipated repairs and real estate tax valuation reassessments or mileage rate increases;

· our inability to control operating expenses or achieve increases in revenues;

· the results of litigation filed or to be filed against us;

· risks related to our joint ventures;

· risks of personal injury claims and property damage related to mold claims because of diminished insurance coverage;

· catastrophic property damage losses that are not covered by our insurance;

· risks associated with property acquisitions such as environmental liabilities, among others;

· changes in market conditions that may limit or prevent us from acquiring or selling properties;

· the perception of tenants and prospective tenants as to the attractiveness, convenience and safety of our properties or the neighborhoods in which they are located; and

· the Partnership does not carry directors and officers insurance.

We are dependent on rental income from our multifamily apartment complexes and commercial properties.  If we are unable to attract and retain tenants or if our tenants are unable to pay their rental obligations, our financial condition and funds available for distribution to our shareholders will be adversely affected.

Our multifamily apartment complexes and commercial properties are subject to competition.  Our properties and joint venture investments are located in developed areas that include other properties. The properties also compete with other rental alternatives, such as condominiums, single and multifamily rental homes, owner occupied single and multifamily homes, and commercial properties in attracting tenants. This competition may affect our ability to attract and retain residents and to increase or maintain rental rates.

The properties we own are concentrated in Eastern Massachusetts and Southern New Hampshire.  Our performance, therefore, is linked to economic conditions and the market for available rental housing and commercial space in these states. A decline in the market for apartment housing and/or commercial properties may adversely affect our financial condition, results of operations and ability to make distributions to our shareholders.

Our insurance may not be adequate to cover certain risks.  There are certain types of risks, generally of a catastrophic nature, such as earthquakes, floods, windstorms, act of war and terrorist attacks that may be uninsurable, or are not economically insurable, or are not fully covered by insurance. Moreover, certain risks, such as mold and environmental exposures, generally are not covered by our insurance. Should an uninsured loss or a loss in excess of insured limits occur, we could lose our equity in the affected property as well as the anticipated future cash flow from

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that property. Any such loss could have a material adverse effect on our business, financial condition and results of operations.

Debt financing could adversely affect our performance.  The vast majority of our assets are encumbered by project specific, non‑recourse, non‑ cross‑collateralized mortgage debt. There is a risk that these properties will not have sufficient cash flow from operations for payments of required principal and interest. We may not be able to refinance these loans at an amount equal to the loan balance and the terms of any refinancing may not be as favorable as the terms of existing indebtedness. If we are unable to make required payments on indebtedness that is secured by a mortgage, the Partnership will either invest additional money in the property or the property securing the mortgage may be foreclosed with a consequent loss of income and value to us.

We are obligated to comply with financial covenants in our indebtedness that could restrict our range of operating activities. The mortgages on our properties contain customary negative covenants, including limitations on our ability, without prior consent of the lender and other items. Failure to comply with these covenants could cause a default under the agreements and, in certain circumstances; our lenders may be entitled to accelerate our debt obligations. Defaults under our debt agreements could materially and adversely affect our financial condition and results of operations.

Real estate investments are generally illiquid, and we may not be able to sell our properties when it is economically or strategically advantageous to do so.  Real estate investments generally cannot be sold quickly, and our ability to sell properties may be affected by market conditions. We may not be able to diversify or vary our portfolio promptly in accordance with our strategies or in response to economic or other conditions.

Our access to public debt markets is limited.  Substantially all of our debt financings are secured by mortgages on our properties because of our limited access to public debt markets.

Litigation may result in unfavorable outcomes.  Like many real estate operators, we may be involved in lawsuits involving premises liability claims, housing discrimination claims and alleged violations of landlord‑tenant laws, which may give rise to class action litigation or governmental investigations. Any material litigation not covered by insurance, such as a class action, could result in substantial costs being incurred. The Partnership does not carry directors and officer’s liability insurance.

Our financial results may be adversely impacted if we are unable to sell properties and employ the proceeds in accordance with our strategic plan.  Our ability to pay down debt, reduce our interest costs, repurchase Depositary Receipts and acquire properties is dependent upon our ability to sell the properties we have selected for disposition at the prices and within the deadlines we have established for each respective property.

The costs of complying with laws and regulations could adversely affect our cash flow and ability to make distributions to our shareholders.  Our properties must comply with Title III of the Americans with Disabilities Act (the “ADA”) to the extent that they are “public accommodations” or “commercial facilities” as defined in the ADA. The ADA does not consider apartment complexes to be public accommodations or commercial facilities, except for portions of such properties that are open to the public. In addition, the Fair Housing Amendments Act of 1988 (the “FHAA”) requires apartment complexes first occupied after March 13, 1990, to be accessible to the handicapped. Other laws also require apartment communities to be handicap accessible. Noncompliance with these laws could result in the imposition of fines or an award of damages to private litigants. We may be subject to lawsuits alleging violations of handicap design laws in connection with certain of our developments. If compliance with these laws involves substantial expenditures or must be made on an accelerated basis, our ability to make distributions to our shareholders could be adversely affected.

Under various federal, state and local laws, an owner or operator of real estate may be liable for the costs of removal or remediation of certain hazardous or toxic substances on, under or in the property. This liability may be imposed without regard to whether the owner or operator knew of, or was responsible for, the presence of the substances. Other law imposes on owners and operators certain requirements regarding conditions and activities that may affect human health or the environment. Failure to comply with applicable requirements could complicate our ability to lease or sell an affected property and could subject us to monetary penalties, costs required to achieve compliance and potential

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liability to third parties. We are not aware of any material noncompliance, liability or claim relating to hazardous or toxic substances or other environmental matters in connection with any of our properties. Nonetheless, it is possible that material environmental contamination or conditions exist, or could arise in the future, in the apartment communities or on the land upon which they are located.

We are subject to the risks associated with investments through joint ventures.  Nine of our properties are owned by joint ventures in which we do not have a direct controlling interest. We may enter into joint ventures, including joint ventures that we do not control, in the future. Any joint venture investment involves risks such as the possibility that the co‑ venturer may seek relief under federal or state insolvency laws, or have economic or business interests or goals that are inconsistent with our business interests or goals. While the bankruptcy or insolvency of our co‑venturer generally should not disrupt the operations of the joint venture, we could be forced to purchase the co‑venturer’s interest in the joint venture or the interest could be sold to a third party. We also may guarantee the indebtedness of our joint ventures. If we do not have control over a joint venture, the value of our investment may be affected adversely by a third party that may have different goals and capabilities than ours.

We are subject to risks associated with development, acquisition and expansion of multifamily apartment complexes and commercial properties.  Development projects and acquisitions and expansions of apartment complexes are subject to a number of risks, including:

· availability of acceptable financing;

· competition with other entities for investment opportunities;

· failure by our properties to achieve anticipated operating results;

· construction costs of a property exceeding original estimates;

· delays in construction; and

· expenditure of funds on, and the devotion of management time to, transactions that may not come to fruition.

We are subject to control by our directors and officers.  The directors and executive officers of the General Partner and members of their families and related entities owned approximately 35% of our depositary receipts as of December 31, 2017. Additionally, management decisions rest with our General Partner without limited partner approval.

Competition for skilled personnel could increase our labor costs.  We and our management company compete with various other companies in attracting and retaining qualified and skilled personnel who are responsible for the day‑ to‑day operations of our properties. Competitive pressures may require that we enhance our pay and benefits package to compete effectively for such personnel. We may not be able to offset such added costs by increasing the rates we charge our tenants. If there is an increase in these costs or if we fail to attract and retain qualified and skilled personnel, our business and operating results could be harmed.

We depend on our key personnel.  Our success depends to a significant degree upon the continued contribution of key members of the management company, who may be difficult to replace. The loss of services of these executives could have a material adverse effect on us. There can be no assurance that the services of such personnel will continue to be available to us. We do not hold key‑man life insurance on any of our key personnel.

10

Changes in market conditions could adversely affect the market price of our Depositary Receipts.  As with other publicly traded equity securities, the value of our depositary receipts depends on various market conditions, which may change from time to time. Among the market conditions that may affect the value of our depositary receipts are the following:

· the extent of investor interest in us;

· the general reputation of real estate companies and the attractiveness of our equity securities in comparison to other equity securities, including securities issued by other real estate companies;

· our financial performance; and

· general stock and bond market conditions.

The market value of our depositary is based primarily upon the market’s perception of our growth potential and our current and potential future earnings and cash distributions. Consequently, our depositary receipts may trade at prices that are higher or lower than our net asset value per depositary receipt.

We face possible risks associated with the physical effects of climate change.  We cannot predict with the certainty whether climate change is occurring and, if so at what rate. However, the physical effects of climate change could have a material effect on our properties, operations, and business. To the extent climate change causes changes in weather patterns, our markets could experience increases in storm intensity and rising sea levels. Over time, these conditions could result in declining demand for our buildings or the inability of us to operate the buildings at all. Climate change may also have indirect effects on our business by increasing the cost of (or making unavailable) property insurance on terms we find acceptable, increasing the cost of energy and increasing the cost of snow removal at our properties. Proposed federal legislation to address climate change could increase utility and other costs of operating our properties which, if not offset by rising rental income, would reduce our net income. There can be no assurance that climate change will not have a material adverse effect on our properties, operations or business.

Security breaches and other disruptions could compromise our information and expose us to liability, which would cause our business and reputation to suffer  In the ordinary course of our business, we collect and store sensitive data, including intellectual property, our proprietary business information and that of our tenants and business partners, including personally identifiable information of our tenants and employees, in our data centers and on our networks. Despite our security measures, our information technology and infrastructure may be vulnerable to attacks by hackers or breached due to employee error, malfeasance or other disruptions. Any such breach could compromise our networks and the information stored there could be accessed, publicly disclosed, lost or stolen. Any such access, disclosure or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, disrupt our operations, and damage our reputation, which could adversely affect our business.

Risk of changes in the tax law applicable to real estate partnerships.  Since the Internal Revenue Service, the United States Treasury Department and Congress frequently review federal income legislation, we cannot predict whether, when or to what extent new federal tax laws, regulations, interpretations or rulings will be adopted. Any such legislative action may prospectively or retroactively modify our tax treatment and therefore, may adversely affect taxation to us, and/or our partners.

ITEM 1B.  UNRESOLVED STAFF COMMENTS

None. 

 ITEM 2.  PROPERTIES

The Partnership and its Subsidiary Partnerships own the Apartment Complexes, the Condominium Units, the Commercial Properties and a 40‑50% interest in nine Investment Properties. See also “Item 13. Certain Relationships and Related Transactions and Director Independence” for information concerning affiliated transactions.

11

Apartment Complexes

The table below lists the location of the 2,632 Apartment Units, the number and type of units in each complex, the range of rents and vacancies as of February 1, 2018, the principal amount outstanding under any mortgages as of December 31, 2017, the fixed interest rates applicable to such mortgages, and the maturity dates of such mortgages.

							Mortgage Balance
							and Interest Rate			Maturity
	Number and Type						As of			Date of
Apartment Complex	of Units	Rent Range				Vacancies	December 31, 2017		(1)	Mortgage
Battle Green LLC	48 units					1	$	4,460,057		2026
34–42 Worthen Road	0 three bedroom				N/A			4.95	%
Lexington, MA	24 two bedroom	$	2,225	–	2,575
	24 one bedroom	$	1,650	–	2,125
	0 studios				N/A
Boylston Downtown L.P.	269 units					1	$	39,049,572		2028
62 Boylston Street	0 three bedroom				N/A			3.97	%
Boston, MA	0 two bedroom				N/A
	53 one bedroom	$	2,025	–	3,000
	216 studios	$	1,380	–	2,250
Brookside Associates, LLC	44 units					1	$	2,501,972		2020
5–7–10–12 Totman Road	0 three bedroom				N/A			5.81	%
Woburn, MA	34 two bedroom	$	1,500	–	1,750
	10 one bedroom	$	1,375	–	1,550
	0 studios				N/A
Clovelly Apartments L.P.	103 units					2	$	4,160,000		2023
160–170 Concord Street	0 three bedroom				N/A			5.62	%
Nashua, NH	53 two bedroom	$	1,030	–	1,450
	50 one bedroom	$	975	–	1,150
	0 studios				N/A
Commonwealth 1137 L.P.	35 units					1	$	3,750,000		2023
1131–1137 Commonwealth Ave.	29 three bedroom	$	2,550	–	3,350			5.65	%
Allston, MA	4 two bedroom	$	2,150	–	2,450
	1 one bedroom	$	1,100	–	1,100
	1 studio	$	1,350	–	1,350
Commonwealth 1144 L.P.	261 units					1	$	14,780,000		2023
1144–1160 Commonwealth Ave.	0 three bedroom				N/A			5.61	%
Allston, MA	11 two bedroom	$	1,075	–	2,125
	109 one bedroom	$	1,450	–	1,950
	141 studios	$	950	–	1,675
Nera Dean Street Associates, LLC	69 units					—	$	5,687,000		2024
38–48 Dean Street	0 three bedroom				N/A			4.22	%
Norwood, MA	66 two bedroom	$	1,475	–	1,695
	3 one bedroom	$	1,400	–	1,450
	0 studios				N/A
Executive Apartments L.P	72 units					1	$	2,415,000		2023
545–561 Worcester Road	1 three bedroom	$	2,000	–	2,000			5.59	%
Framingham, MA	47 two bedroom	$	1,350	–	1,675
	24 one bedroom	$	1,300	–	1,450
	0 studios				N/A
Hamilton Green Apartments LLC	193 units					8	$	36,555,470		2028
311–319 Lowell Street	10 three bedroom	$	1,048	–	2,850			4.67	%
Andover, MA	168 two bedroom	$	914	–	4,500
	15 one bedroom	$	1,149	–	1,925
Hamilton Oaks Associates, LLC	268 units					3	$	11,925,000		2023
30–50 Oak Street Extension	0 three bedroom				N/A			5.59	%
40–60 Reservoir Street	96 two bedroom	$	1,400	–	1,675
Brockton, MA	159 one bedroom	$	1,025	–	1,475
	13 studios	$	970	–	1,175

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							Mortgage Balance
							and Interest Rate			Maturity
	Number and Type						As of			Date of
Apartment Complex	of Units	Rent Range				Vacancies	December 31, 2017		(1)	Mortgage
Highland Street Apartments L.P.	36 units					1	$	1,050,000		2023
38–40 Highland Street	0 three bedroom				N/A			5.59	%
Lowell, MA	24 two bedroom	$	1,090	–	1,350
	10 one bedroom	$	985	–	1,150
	2 studios	$	1,050	–	1,050
Linhart L.P.	9 units					—	$
4–34 Lincoln Street	0 three bedroom				N/A			—	%
Newton, MA	0 two bedroom				N/A
	5 one bedroom	$	1,025	–	1,550
	4 studios	$	1,165	–	1,215
North Beacon 140 L.P.	65 units					—	$	6,937,000		2023
140–154 North Beacon Street	10 three bedroom	$	2,725	–	3,100			5.59	%
Brighton, MA	54 two bedroom	$	1,975	–	2,625
	1 one bedroom	$	1,825	–	1,825
	0 studios				N/A
Olde English Apartments L.P.	84 units					—	$	3,080,000		2023
703–718 Chelmsford Street	0 three bedroom				N/A			5.63	%
Lowell, MA	47 two bedroom	$	1,245	–	1,525
	30 one bedroom	$	1,140	–	1,350
	7 studios	$	1,050	–	1,175
Redwood Hills L.P.	180 units					5	$	6,743,000		2023
376-382 Sunderland road	0 three bedroom				N/A			5.59	%
Worcester, MA	89 two bedroom	$	1,250	–	1,475
	91 one bedroom	$	1,050	–	1,175
	0 studios				N/A
Residences at Captain Parkers LLC	94 units					11	$	20,071,000		2026
125 Worthen Road and Ryder Lane	8 three bedroom	$	2,860	–	3,300			3.24	%
Lexington, MA	48 two bedroom	$	2,020	–	2,958
	38 one bedroom	$	1,800	–	2,400
	0 studios				N/A
River Drive L.P.	72 units					1	$	3,465,000		2023
3–17 River Drive	0 three bedroom				N/A			5.62	%
Danvers, MA	60 two bedroom	$	1,375	–	1,700
	5 one bedroom	$	1,220	–	1,550
	7 studios	$	1,200	–	1,350
School Street 9, LLC	184 units					1	$	14,549,604		2023
9 School Street	0 three bedroom				N/A			3.76	%
Framingham, MA	96 two bedroom	$	1,400	–	1,800
	88 one bedroom	$	1,190	–	1,475
	0 studios				N/A
WCB Associates, LLC	180 units					2	$	7,000,000		2023
10–70 Westland Street	1 three bedroom	$	1,475	–	1,475			5.66	%
985–997 Pleasant Street	94 two bedroom	$	1,200	–	1,565
Brockton, MA	85 one bedroom	$	925	–	1,275
	0 studios				N/A
Westgate Apartments, LLC	220 units					4	$	15,700,000		2023
2–20 Westgate Drive	0 three bedroom				N/A			4.65	%
Woburn, MA	110 two bedroom	$	1,600	–	1,950
	110 one bedroom	$	1,265	–	1,775
	0 studios				N/A
Westgate Apartments Burlington, LLC	20 units					—	$	2,500,000		2024
105–107 Westgate Drive	0 three bedroom				N/A			4.31	%
Burlington, MA	12 two bedroom	$	1,925	–	2,250
	8 one bedroom	$	1,575	–	1,750
	0 studios				N/A

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							Mortgage Balance
							and Interest Rate			Maturity
	Number and Type						As of			Date of
Apartment Complex	of Units	Rent Range				Vacancies	December 31, 2017		(1)	Mortgage
Woodland Park Partners,, LLC	126 units					1	$	22,250,000		2027
264-290 Grove Street	0 three bedroom				N/A			3.79	%
Newton, MA	80 two bedroom	$	1,750	–	2,150
	30 one bedroom	$	1,675	–	1,850
	16 studios	$	1,300	–	1,500

(1) The mortgage balance is stated before unamortized deferred financing costs.

Current free rent concessions would result in an average reduction in unit rents of less than $7.09 per month per unit. Free rent expense amortized in 2017 was approximately $224,000 compared to approximately $236,000 in 2016.

On July 6, 2017, Woodland Park Partners, LLC, a newly formed subsidiary of the Partnership, purchased the Woodland Park Apartments, a 126-unit apartment complex located at 264-290 Grove Street, Newton, Massachusetts , for a purchase price of $45,600,000. The closing costs were approximately $64,000.To fund the purchase price, the Partnership borrowed $25,000,000 under its outstanding line of credit with KeyBank, NA, and $16,000,000 from HBC Holdings, LLC, a Massachusetts limited liability company controlled by Harold Brown. The loan from HBC Holdings was to mature on July 16, 2018, with interest only at 4.75%.  The balance of the purchase price was funded by the Partnership’s cash reserves. From the purchase price, the Partnership allocated approximately $541,000 for in- place leases, and approximately $42,000 to the value of tenant relationships. These amounts are being amortized over 12 and 24 months respectively.

On September 29, 2017, Woodland Park Partners LLC, entered into a Multifamily Loan and Security Agreement with KeyBank National Association . The manager of Woodland Park is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Woodland Park. The Loan Agreement provides for a term loan in the principal amount of $22,250,000.  The Loan is due on October 1, 2027 , unless the due date is accelerated in accordance with the Loan’s terms, with interest only through October 1, 2022. Borrowings under the Loan will bear interest at the rate of 3.79%. The proceeds of the loan were used to pay off the loan from HBC Holdings, LLC and pay down the line of credit.

On January 7, 2016, Residences at Captain Parker, LLC, a Massachusetts limited liability company (“Captain Parker”) entered into a Multifamily Loan and Security Agreement with KeyBank National Association (the “Lender”). The manager of Captain Parker is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Captain Parker. The Loan Agreement provides for a term loan in the principal amount of $20,071,000.  The Loan is due on February 1, 2026 , unless the due date is accelerated in accordance with the Loan’s terms.  The proceeds of the Loan are being used to refinance existing indebtedness. The Partnership is a limited guarantor of certain of the Captain Parker obligations under the Loan Agreement.

See Note 5 to the Consolidated Financial Statements, included as part of this Form 10‑K, for information relating to the mortgages payable of the Partnership and its Subsidiary Partnerships.

Condominium Units

The Partnership owns and leases to residential tenants 19 Condominium Units in the metropolitan Boston area of Massachusetts.

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The table below lists the location of the 19 Condominium Units, the type of units, the range of rents received by the Partnership for such units, and the number of vacancies as of February 1, 2018.

							Mortgage Balance
	Number and Type						and Interest Rate	Maturity
	of Units Owned						As of	Date of
Condominiums	by Partnership	Rent Range				Vacancies	December 31, 2017	Mortgage
Riverside Apartments	19 units					1	—	—
8–20 Riverside Street	0 three bedroom				N/A
Watertown, MA	12 two bedroom	$	1,550	–	1,975
	5 one bedroom	$	1,640	–	1,850
	2 studios	$	1,350	–	1,625

Commercial Properties

BOYLSTON DOWNTOWN LP.  In 1995, this Subsidiary Partnership acquired the Boylston Downtown property in Boston, Massachusetts (“Boylston”). This mixed‑use property includes 17,218 square feet of rentable commercial space. As of February 1, 2018, the commercial space was fully occupied, and the average rent per square foot was $25.88. For mortgage balance, interest rate and maturity date information see “Apartment Complexes” above.

HAMILTON OAKS ASSOCIATES, LLC.  The Hamilton Oaks Apartment complex, acquired by the Partnership in December 1999 through Hamilton Oaks Associates, LLC, includes 6,075 square feet of rentable commercial space, occupied by a daycare center. As of February 1, 2018, the commercial space was fully occupied, and the average rent per square foot was $14.00. The Partnership also rents roof space for a cellular phone antenna at an average rent of approximately $42,000 per year through November 2020. For mortgage balance, interest rate and maturity date information see “Apartment Complexes” above.

LINHART LP.  In 1995, the Partnership acquired the Linhart property in Newton, Massachusetts (“Linhart”). This mixed‑use property includes 21,548 square feet of rentable commercial space. As of February 1, 2018, the commercial space was fully occupied, and the average rent per square foot was $25.44.  

NORTH BEACON 140 LP.  In 1995, this Subsidiary Partnership acquired the North Beacon property in Boston, Massachusetts (“North Beacon”). This mixed‑use property includes 1,050 square feet of rentable commercial space. The property was fully rented as of February 1, 2018, and the average rent per square foot as of that date was $36.50. For mortgage balance, interest rate and maturity date information see “Apartment Complexes” above.

STAPLES PLAZA.  In 1999, the Partnership acquired the Staples Plaza shopping center in Framingham, Massachusetts (“Staples Plaza”). The shopping center consists of 38,695 square feet of rentable commercial space. As of December 31, 2017, the mortgage had an outstanding balance $6,000,000 with interest rate of 5.97%, matures in 2018. As of February 1, 2018 Staples Plaza was fully occupied, and the average net rent per square foot was $23.65.

HAMILTON LINEWT ASSOCIATES, LLC.  In 2007, the Partnership acquired a retail block in Newton, Massachusetts. The property consists of 5,850 square feet of rentable commercial space. The property was fully rented as of February 1, 2018 at an average rent of $35.08 per square foot

HAMILTON CYPRESS LLC.  In 2008, the Partnership acquired a medical office building in Brookline, Massachusetts. The property consists of 17,607 square feet of rentable commercial space. As of February 1, 2018, the property was 100% occupied at an average rent of $35.05 per square foot.

15

The following information is provided for commercial leases:

			Total square	Total number	Percentage of
	Annual base rent		feet for	of leases	annual base rent
Through December 31,	for expiring leases		expiring leases	expiring	for expiring leases
2018	$	499,878	19,724	14	17	%
2019		576,710	20,838	11	19	%
2020		185,494	4,461	6	6	%
2021		829,156	40,323	6	29	%
2022		486,772	12,218	6	16	%
2023		157,443	4,771	1	5	%
2024		94,184	1,858	1	3	%
2025		—	—	—	—	%
2026		—	—	—	—	%
2027		—	—	—	—	%
2028		—	—	—	—	%
2029		142,450	3,850	1	5	%
Totals	$	2,972,087	108,043	46	100	%

Commercial rental income is accounted for using the straight line method. Approximately fifty percent of our commercial leases contain rent escalations which range from $0.50– $1.00 per square foot per year.

Investment Properties

See Note 14 to the Financial Statements and Exhibit 99.1 for additional information regarding the Investment Properties.

The Partnership has a 50% ownership interest in the properties summarized below:

							Mortgage Balance
							and Interest Rate			Maturity
	Number and Type						As of			Date of
Investment Properties	of Units	Range				Vacancies	December 31, 2017		(1)	Mortgage
345 Franklin, LLC	40 Units					—	$	9,742,760		2028
345 Franklin Street	0 three bedroom				N/A			3.87	%
Cambridge, MA	39 two bedroom	$	2,875	–	3,475
	1 one bedroom	$	2,700	–	2,700
	0 studios				N/A
Hamilton on Main Apartments, LLC	148 Units					6	$	16,900,000		2024
223 Main Street	0 three bedroom				N/A			4.34	%
Watertown, MA	93 two bedroom	$	1,550	–	2,350
	31 one bedroom	$	1,450	–	2,000
	24 studios	$	1,325	–	1,800
Hamilton Minuteman, LLC	42 Units					—	$	6,000,000		2031
1 April Lane	0 three bedroom				N/A			3.71	%
Lexington, MA	40 two bedroom	$	1,700	–	2,375
	2 one bedroom	$	2,050	–	2,050
	0 studios				N/A
Hamilton Essex 81 LLC	49 Units					—	$	10,000,000		2025
Residential	0 three bedroom				N/A			3.24	%
81–83 Essex Street	11 two bedroom	$	2,200	–	2,875
Boston, Massachusetts	38 one bedroom	$	1,725	–	2,750
	0 studios				N/A
Hamilton Essex Development LLC	Parking Lot
Commercial
81–83 Essex Street
Boston, Massachusetts

16

							Mortgage Balance
							and Interest Rate			Maturity
	Number and Type						As of			Date of
Investment Properties	of Units	Range				Vacancies	December 31, 2017		(1)	Mortgage
Hamilton 1025, LLC (A)	17 Units					12
Units to be retained	0 three bedroom				N/A
1025 Hancock Street	3 two bedroom	$	N/A	–	N/A
Quincy, Massachusetts	14 one bedroom	$	1,500	–	1,580
	0 studios				N/A
Hamilton Bay Apartments, LLC (A)	17 Units					12
165–185 Quincy Shore Drive	0 three bedroom				N/A
Quincy, Massachusetts	11 two bedroom	$	1,700	–	2,100
	6 one bedroom	$	1,525	–	1,740
	0 studios				N/A
The Partnership has a 40% ownership interest in the property summarized below:
Hamilton Park Towers, LLC	409 Units					5	$	82,004,495		2019
175–185 Freeman Street,	71 three bedroom	$	3,500	–	4,750			5.57	%
Brookline,	227 two bedroom	$	2,200	–	3,575
Massachusetts	111 one bedroom	$	1,950	–	2,625
	0 studios

Current free rent concessions would result in an average reduction in unit rents of  $29.32 per month per unit. Free rent amortized in 2017 was approximately $254,000, compared to $133,000 in 2016.

(A) Represents unsold units at February 1, 2018.

(1) The mortgage balance is stated before unamortized deferred financing costs.

345 FRANKLIN, LLC.  In November 2001, the Partnership invested approximately $1,533,000 for a 50% ownership interest in a 40‑unit apartment building in Cambridge, Massachusetts. In June 2013, the property was refinanced with a 15 year mortgage in the amount of $10,000,000 at 3.87%, interest only for 3 years and is amortized on a 30‑year schedule for the balance of the term. The Partnership paid off the prior mortgage of approximately $6,776,000 with the proceeds of the new mortgage. After the refinancing, the property made a distribution of $1,610,000 to the Partnership. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. At December 31, 2017, the balance of this mortgage before unamortized deferred financing costs is approximately $9,743,000. This investment is referred to as 345 Franklin, LLC.

HAMILTON ON MAIN, LLC.  In August 2004, the Partnership invested $8,000,000 for a 50% ownership interest in a 280‑unit apartment complex located in Watertown, Massachusetts. The total purchase price was $56,000,000. The Partnership sold 137 units as condominiums. The assets were combined with Hamilton on Main Apartments. Hamilton on Main, LLC is known as Hamilton Place. In 2005, Hamilton on Main Apartments, LLC obtained a ten year mortgage on the three buildings to be retained. The mortgage was $16,825,000, with interest only of 5.18% for three years and amortizing on a 30 year schedule for the remaining seven years when the balance is due. The net proceeds after funding escrow accounts and closing costs on the mortgage were approximately $16,700,000, which were used to reduce the existing mortgage. In August 2014, the property was refinanced with a 10 year mortgage in the amount of $16,900,000 at 4.34% interest only. The Joint Venture Partnership paid off the prior mortgage of approximately $15,205,000 with the proceeds of the new mortgage and distributed $850,000 to the Partnership. The costs associated with the refinancing were approximately $161,000. At December 31, 2017, the balance of this mortgage before unamortized deferred financing costs is approximately $16,900,000. This investment is referred to as Hamilton on Main, LLC.

HAMILTON MINUTEMAN, LLC.  In September 2004, the Partnership invested approximately $5,075,000 for a 50% ownership interest in a 42‑unit apartment complex located in Lexington, Massachusetts. The purchase price was $10,100,000. In October 2004, the Partnership obtained a mortgage on the property in the amount of $8,025,000 and returned $3,775,000 to the Partnership. The Partnership obtained a new 10‑year mortgage in the amount of $5,500,000 in

17

January 2007. The interest on the new loan was 5.67% fixed for the ten year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan. This loan required a cash contribution by the Partnership of $1,250,000 in December 2006. On September 12, 2016, the property was refinanced with a 15 year mortgage in the amount of $6,000,000, at 3.71%, interest only. The Joint Venture Partnership paid off the prior mortgage of approximately $5,158,000 with the proceeds of the new mortgage and made a distribution of $385,000 to the Partnership. The cost associated with the refinancing was approximately $123,000. This investment is referred to as Hamilton Minuteman, LLC. At December 31, 2017, the balance on this mortgage before unamortized deferred financing costs is approximately $6,000,000. This investment is referred to as Hamilton Minuteman, LLC.

HAMILTON 1025, LLC.  On March 2, 2005, the Partnership invested $2,352,000 for a 50% ownership interest in a 176‑unit apartment complex with an additional small commercial building located in Quincy, Massachusetts. The purchase price was $23,750,000. The Partnership sold 127 of the units as condominiums and retained 49 units for long‑term investment. The Partnership obtained a new 10‑year mortgage in the amount of $5,000,000 on the units to be retained by the Partnership. The interest on the new loan was 5.67% fixed for the 10 year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan term. On July 8, 2016, Hamilton 1025 LLC paid off the outstanding balance of the mortgage balance. The Partnership made a capital contribution of $2,359,500 to Hamilton 1025, LLC for its share of the funds required for the transaction. 20 units were sold in the year ended December 31, 2017 with a gain on the sales of approximately $2,380,000. For the year ended December 31, 2016, 10 units were sold  for a gain of approximately $1,324,0000. As of December 31, 2017, 7 units are under purchase and sales agreements and the Partnership still owns 18 units. One unit was sold in January, 2018. 

HAMILTON ESSEX 81, LLC.  On March 7, 2005, the Partnership invested $2,000,000 for a 50% ownership interest in a building comprising 48 apartments, one commercial space and a 50‑car surface parking lot located in Boston, Massachusetts. The purchase price was $14,300,000, with a $10,750,000 mortgage. The Partnership planned to operate the building and initiate development of the parking lot. In June 2007, the Partnership separated the parcels, formed an additional limited liability company for the residential apartments and obtained a mortgage on the property. The new limited liability company formed for the residential apartments and commercial space is referred to as Hamilton Essex 81, LLC. In August 2008, the Partnership restructured the mortgages on both parcels at Essex 81 and transferred the residential apartments to Hamilton Essex 81, LLC. On September 28, 2015, Hamilton Essex Development, LLC paid off the outstanding mortgage balance of $1,952,286.  The Partnership made a capital contribution of $978,193 to Hamilton Essex Development LLC for its share of the funds required for the transaction.  Additionally, the Partnership made a capital contribution of $100,000 to Hamilton Essex 81, LLC.  On September 30, 2015, Hamilton Essex 81, LLC obtained a new 10 year mortgage in the amount of $10,000,000, interest only at 2.18% plus the one month Libor rate.  The proceeds of the note were used to pay off the existing mortgage of $8,040,719 and the Partnership received a distribution of $978,193 for its share of the excess proceeds. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. The investment in the parking lot is referred to as Hamilton Essex Development, LLC; the investment in the apartments is referred to as Hamilton Essex 81, LLC. At December 31, 2017, the balance on this mortgage before unamortized deferred financing costs is approximately $10,000,000.

HAMILTON BAY, LLC.   On October 3, 2005, the Partnership invested $2,500,000 for a 50% ownership interest in a 168‑unit apartment complex in Quincy, Massachusetts. The purchase price was $30,875,000. The Joint Venture sold 120 units as condominiums and retained 48 units for long‑term investment. In February 2007, the Joint Venture refinanced the 48 units with a new 10 year mortgage in the amount of $4,750,000 with an interest rate of 5.57%, interest only for five years. The loan is amortized over 30 years thereafter and matures in March 2017. On March 1, 2017, the mortgage balance was paid in full, with the Partnership contributing its share of the mortgage balance of approximately $2,222,000. As of December 31, 2017, 29 units were sold with a gain on the sales of approximately $3,628,000. As of December 31,2017 an additional 6 units are under purchase and sales agreements, and the Partnership still owns 19 units. Two units were sold in January, 2018. This investment is referred to as Hamilton Bay Apartments, LLC.

During 2017, Hamilton Bay LLC, a Joint Ventire, sold one unit for a gain of approximately $133,000. As of December 31,2017, all units have been sold by this Joint Venture.

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HAMILTON PARK TOWERS, LLC.  On October 28, 2009 the Partnership invested approximately $15,925,000 in a joint venture to acquire a 40% interest in a residential property located in Brookline, Massachusetts. The property, Hamilton Park Towers LLC, referred to as Dexter Park, is a 409 unit residential complex. The purchase price was $129,500,000. In order to fund this investment, the Partnership used approximately $8,757,000 of its cash reserves and borrowed approximately $7,168,000 with an interest rate of 6% from HBC Holdings, LLC, an entity owned by Harold Brown and his affiliates (“HBC”). The term of the loan was four years with a provision requiring payment in whole or in part upon demand by HBC with six months notice. The loan was paid in full in April 2012. The total mortgage was $89,914,000 with an interest rate of 5.57% and it matures in 2019. The mortgage calls for interest only payments for the first two years of the loan and amortized over 30 years thereafter. The balance of this mortgage before unamortized deferred financing costs is approximately $82,004,000 at December 31, 2017. This investment, Hamilton Park Towers, LLC is referred to as Dexter Park.

ITEM 3.  LEGAL PROCEEDINGS

The Partnership, the Subsidiary Partnerships, and the Investment Properties and their properties are not presently subject to any material litigation, and, to management’s knowledge, there is not any material litigation presently threatened against them. The properties are occasionally subject to ordinary routine legal and administrative proceedings incident to the ownership of residential and commercial real estate. Some of the legal and other expenses related to these proceedings are covered by insurance and none of these costs and expenses are expected to have a material adverse effect on the Consolidated Financial Statements of the Partnership.

ITEM 4.  MINE SAFETY DISCLOSURE

Not applicable.

PART II

ITEM 5.  MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Each Class A Unit is exchangeable, through Computershare Trust Company (“Computershare”) (formerly Equiserve LP), the Partnership’s Depositary Agent, for 30 Depositary Receipts (“Receipts”). The Receipts are listed and publicly traded on the NYSE MKT Exchange under the symbol “NEN.” There has never been an established trading market for the Class B Units or General Partnership Units.

In 2017, the high and low bid quotations for the Receipts were $59.10 and $75.25 respectively. The table below sets forth the high, low and closing price for each quarter of 2017 and 2016 and the distributions paid on the Partnership’s Depositary Receipts:

Effective January 3, 2012, the Partnership authorized a 3‑for‑1 forward split of its Depositary Receipts listed on the NYSE MKT and a concurrent adjustment of the exchange ratio of Depositary Receipts for Class A Units of the Partnership from 10‑to‑1 to 30‑to‑1, such that each Depositary Receipt represents one‑thirtieth (1/₃₀) of a Class A Unit of the Partnership.

All references to Depositary Receipts in the report are reflective of the 3‑for‑1 forward split.

	2017								2016
	Low Bid		High Bid		Close		Distributions		Low Bid		High Bid		Close		Distributions
First Quarter	$	59.10	$	69.00	$	69.00	$	0.30	$	48.18	$	55.70	$	53.92	$	0.25
Second Quarter	$	65.90	$	72.20	$	71.50	$	0.30	$	53.02	$	59.28	$	56.79	$	0.25
Third Quarter	$	69.00	$	72.11	$	69.50	$	0.30	$	56.48	$	67.22	$	60.51	$	0.25
Fourth Quarter	$	69.10	$	75.25	$	73.35	$	1.25	$	58.20	$	63.15	$	60.90	$	1.05

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Distribution to Limited & General Partners were:

	2017		2016
Class A—Limited Partners (80%)	$	6,388,668	$	5,383,743
Class B—Limited Partners (19%)		1,517,309		1,278,639
Class C—General Partner (1%)		79,858		67,297
Total	$	7,985,835	$	6,729,679

On March 9, 2018, the closing price on the NYSE American for a Depositary Receipt was $70.30. There were 2,880,762 Depositary Receipts outstanding and 3,484 Units (representing 104,520 receipts) held by approximately 1,666 record holders.

Any portion of the Partnership’s cash, which the General Partner deems not necessary for cash reserves, is distributed to the Partners, and distributions are made on a quarterly basis. The Partnership has made annual distributions to its Partners since 1978. The Partnership made distributions of $64.50 per unit ($2.15 per receipt) in 2017. The Partnership made distributions of $54.00 per Unit ($1.80 per Receipt) in 2016. The total distribution was $7,985,835 in 2017 and $6,729,679 in 2016. In January 2018, the Partnership declared a quarterly distribution of $9.00 per Unit ($0.30 per Receipt) payable on March 31, 2018.

See “Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters” for certain information relating to the number of holders of each class of Units.

 On August 20, 2007, NewReal, Inc.the General Partner authorized an equity repurchase program (“Repurchase Program”) under which the Partnership was permitted to purchase, over a period of twelve months, up to 300,000 Depositary Receipts (each of which is one‑tenth of a Class A Unit). Over time, the General Partner has authorized increases in the equity repurchase program. On March 10, 2015, the General Partner authorized an increase in the Repurchase Program to 2,000,000 Depository Receipts and extended the Program for an additional five years from March 31, 2015 until March 31, 2020. The Repurchase Program requires the Partnership to repurchase a proportionate number of Class B Units and General Partner Units in connection with any repurchases of any Depositary Receipts by the Partnership based upon the 80%, 19% and 1% fixed distribution percentages of the holders of the Class A, Class B and General Partner Units under the Partnership’s Second Amended and Restate Contract of Limited Partnership. Repurchases of Depositary Receipts or Partnership Units pursuant to the Repurchase Program may be made by the Partnership from time to time in its sole discretion in open market transactions or in privately negotiated transactions. From August 20, 2007 through December 31, 2017, the Partnership has repurchased 1,365,306 Depositary Receipts at an average price of $27.14 per receipt (or $814.20 per underlying Class A Unit), 3,072 Class B Units and 162 General Partnership Units, both at an average price of $ 926.26 per Unit, totaling approximately $40,274,000 including brokerage fees paid by the Partnership.

Issuer Purchase of Equity Securities during the fourth quarter of 2017:

				Remaining number
			Depositary Receipts	of Depositary Receipts
			Purchased as Part	that may be purchased
	Average		of Publicly	Under the Plan
Period	Price Paid		Announced Plan	(as Amended)
October 1-31, 2017	$	—	—	634,694
November 1-30, 2017	$	—	—	634,694
December 1-31, 2017	$	—	—	634,694
Total			—

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See Note 8 to the Consolidated Financial Statements for information concerning this repurchase program.

The Partnership does not have any securities authorized for issuance under any equity compensation plans that are subject to disclosure under Item 201(d) of regulation S-K.

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ITEM 6.  SELECTED FINANCIAL DATA

SELECTED FINANCIAL DATA

	Year Ended December 31,
	2017		2016		2015		2014		2013
INCOME STATEMENT INFORMATION(a)
Revenues	$	52,827,388	$	49,555,090	$	45,480,714	$	42,632,319	$	38,364,552
Expenses		38,682,422		36,295,140		32,597,960		31,545,752		27,051,251
Income before other income and discontinued operations		14,144,966		13,259,950		12,882,754		11,086,567		11,313,301
Other (Loss)		(7,207,035)		(8,309,098)		(9,110,189)		(10,061,717)		(9,355,802)
Income  before discontinued operations		6,937,931		4,950,852		3,772,565		1,024,850		1,957,499
Discontinued operations		—		—		—		—		3,697,886
Net  Income	$	6,937,931	$	4,950,852	$	3,772,565	$	1,024,850	$	5,655,385
Income  before discontinued operations per Unit	$	55.77	$	39.62	$	29.86	$	7.96	$	15.07
Discontinued operations per Unit		—		—		—		—		28.48
Net income  per Unit	$	55.77	$	39.62	$	29.86	$	7.96	$	43.55
Distributions to Partners per Unit	$	64.50	$	54.00	$	30.00	$	30.00	$	30.00
Net income  per Depositary Receipt	$	1.86	$	1.32	$	1.00	$	0.27	$	1.45
Distributions to Partners per Depositary Receipt	$	2.15	$	1.80	$	1.00	$	1.00	$	1.00
BALANCE SHEET INFORMATION
Real Estate, gross		311,951,597		263,659,293		261,276,898		225,021,946		221,454,286
Real Estate, net		207,153,794		169,462,811		176,697,314		149,116,084		152,904,661
Total Assets		226,807,236		190,562,066		200,727,567		176,167,358		183,715,814
Total Debt Outstanding		250,221,258		212,709,080		194,500,820		194,461,825		196,891,135
Partners’ Capital		(35,315,177)		(34,224,726)		(30,810,953)		(27,367,782)		(21,848,563)

The Partnership may purchase and/or sell properties at any time.

The table below reflects the totals of NERA properties available for rental at each December 31,

	Year Ended December 31,
	2017		2016		2015		2014		2013
Residential
Units	2,651		2,525		2,525		2,431		2,431
Vacancies	46		34		41		53		39
Vacancy rate	1.7	%	1.4	%	1.6	%	2.2	%	1.6	%
Commercial
Total square feet	108,043		108,043		108,043		108,043		108,043
Vacancy (in square feet)	—		—		—		—		1,062
Vacancy rate	—	%	—	%	—	%	—	%	1.0	%

See Items 1A and 7 for factors that may affect future operations. The above tables may not be indicative of future results.

(a) Certain reclassifications have been made to prior period amounts in order to conform to current period presentation.

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ITEM 7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward Looking Statements

Certain information contained herein includes forward looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Liquidation Reform Act of 1995 (the “Act”). Forward looking statements in this report, or which management may make orally or in written form from time to time, reflect management’s good faith belief when those statements are made, and are based on information currently available to management. Caution should be exercised in interpreting and relying on such forward looking statements, the realization of which may be impacted by known and unknown risks and uncertainties, events that may occur subsequent to the forward looking statements, and other factors which may be beyond the Partnership’s control and which can materially affect the Partnership’s actual results, performance or achievements for 2018 and beyond. Should one or more of the risks or uncertainties mentioned below materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. We expressly disclaim any responsibility to update our forward looking statements, whether as a result of new information, future events or otherwise. Accordingly, investors should use caution in relying on past forward looking statements, which are based on results and trends at the time they are made, to anticipate future results or trends.

Along with risks detailed in Item 1A and from time to time in the Partnership’s filings with the Securities and Exchange Commission, some factors that could cause the Partnership’s actual results, performance or achievements to differ materially from those expressed or implied by forward looking statements include but are not limited to the following:

· The Partnership depends on the real estate markets where its properties are located, primarily in Eastern Massachusetts, and these markets may be adversely affected by local economic market conditions, which are beyond the Partnership’s control.

· The Partnership is subject to the general economic risks affecting the real estate industry, such as dependence on tenants’ financial condition, the need to enter into new leases or renew leases on terms favorable to tenants in order to generate rental revenues and our ability to collect rents from our tenants.

· The Partnership is also impacted by changing economic conditions making alternative housing arrangements more or less attractive to the Partnership’s tenants, such as the interest rates on single family home mortgages and the availability and purchase price of single family homes in the Greater Boston metropolitan area.

· The Partnership is subject to significant expenditures associated with each investment, such as debt service payments, real estate taxes, insurance and maintenance costs, which are generally not reduced when circumstances cause a reduction in revenues from a property.

· The Partnership is subject to increases in heating and utility costs that may arise as a result of economic and market conditions and fluctuations in seasonal weather conditions.

· Civil disturbances, earthquakes and other natural disasters may result in uninsured or underinsured losses.

· Actual or threatened terrorist attacks may adversely affect our ability to generate revenues and the value of our properties.

· Financing or refinancing of Partnership properties may not be available to the extent necessary or desirable, or may not be available on favorable terms.

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· The Partnership properties face competition from similar properties in the same market. This competition may affect the Partnership’s ability to attract and retain tenants and may reduce the rents that can be charged.

· Given the nature of the real estate business, the Partnership is subject to potential environmental liabilities. These include environmental contamination in the soil at the Partnership’s or neighboring real estate, whether caused by the Partnership, previous owners of the subject property or neighbors of the subject property, and the presence of hazardous materials in the Partnership’s buildings, such as asbestos, lead, mold and radon gas. Management is not aware of any material environmental liabilities at this time.

· Insurance coverage for and relating to commercial properties is increasingly costly and difficult to obtain. In addition, insurance carriers have excluded certain specific items from standard insurance policies, which have resulted in increased risk exposure for the Partnership. These include insurance coverage for acts of terrorism and war, and coverage for mold and other environmental conditions. Coverage for these items is either unavailable or prohibitively expensive.

· Market interest rates could adversely affect market prices for Class A Partnership Units and Depositary Receipts as well as performance and cash flow.

· Changes in income tax laws and regulations may affect the income taxable to owners of the Partnership. These changes may affect the after‑tax value of future distributions.

· The Partnership may fail to identify, acquire, construct or develop additional properties; may develop or acquire properties that do not produce a desired or expected yield on invested capital; may be unable to sell poorly‑ performing or otherwise undesirable properties quickly; or may fail to effectively integrate acquisitions of properties or portfolios of properties.

· Risk associated with the use of debt to fund acquisitions and developments.

· Competition for acquisitions may result in increased prices for properties.

· Any weakness identified in the Partnership’s internal controls as part of the evaluation being undertaken could have an adverse effect on the Partnership’s business.

· Ongoing compliance with Sarbanes‑Oxley Act of 2002 may require additional personnel or systems changes.

The foregoing factors should not be construed as exhaustive or as an admission regarding the adequacy of disclosures made by the Partnership prior to the date hereof or the effectiveness of said Act. The Partnership expressly disclaims any obligation to publicly update or revise any forward‑looking statement, whether as a result of new information, future events or otherwise.

Since the Partnership’s long‑term goals include the acquisition of additional properties, a portion of the proceeds from the refinancing and sale of properties is reserved for this purpose. If available acquisitions do not meet the Partnership’s investment criteria, the Partnership may purchase additional depositary receipts. The Partnership will consider refinancing existing properties if the Partnership’s cash reserves are insufficient to repay existing mortgages or if the Partnership needs additional funds for future acquisitions.

As anticipated, fourth quarter results reflect the continued progress made during the third quarter leasing season of 2017. PartnershipYear To Date  revenue increases continue to exceed national levels and Management expects these increases to be sustained through the first and second quarters of 2018.  Early results for our lease renewal campaign (that began in the fourth quarter of 2017), show a continued appetite for renewal rent increases in excess of 3%. Management expects same store revenue to parallel 2017 and operating expenses to remain in check.

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Management’s review of the broader Hamilton Enterprise reveals continued strong demand amongst a cross section of Rent By Necessity (RBN) tenancy throughout its portfolio including the Partnership properties.  (Conversely, the luxury market continues to bear lower occupancy and lower revenue growth compared to the Partnership).  National employment growth and stronger local employment growth continue to be the engine fueled by a highly educated work force of nearly 600,000 graduates throughout the state annually. With wage growth on the rise, Management does not anticipate the head winds of the rent affordability index as previously stated for the upcoming third and fourth quarters of 2018.  However, it is still cautionary of the pace to date.

For 2017, including the new purchase of Woodland Park, consolidated revenue increased by 6.6%, operating expenses increased by 6.6% and Net Operating Income,  (including Depreciation) grew by 6.7%. Excluding the Woodland Park acquisition, same store revenue grew by 4.0%, operating expenses by 1.6% and Net Operating Income (including Depreciation) grew by 10.7%.  For the same reporting period, vacancy was 1.7% vs 1.4%  , the same as the previous year. Excluding  Depreciation and Amortization, same store revenues (excluding Woodland Park) grew by 4.0%, operating expenses by 2.5% and Net Operating Income by 5.5%.  Management believes similar same store operating results will be achieved for 2018 and that the recent acquisition will result in higher performance.

The Joint Ventures of 1025 Hancock and Hamilton Bay are anticipated to be completely sold out in advance of 2018 year end.  The sellout, estimated at $25.6 million, is expected by the early third quarter ahead of schedule.  Management is currently reviewing the Dexter Park joint venture regarding its existing mortgage expiration of October 2019.  It is exploring early prepayment costs, new debt amounts and resulting cash flows.

On July 31, 2014, the Partnership entered into an agreement for a $25,000,000 revolving line of credit. The term of the line is three years with a floating interest rate equal to a base rate of the greater of (a) the Prime Rate (b) the Federal Funds Rate plus one‑half of one percent per annum, or (c) the LIBOR Rate for a period of one month plus 1% per annum, plus an applicable margin of 2.5%. The agreement originally expired on July 31, 2017, and was subsequently extended until October 31, 2020. The costs associated with the line of credit extension were approximately $128,000.  As of December 31, 2017, the credit line had an outstanding balance of $17,000,000. See Note 5 – Mortgage Notes Payable-for additional information.

On July 6, 2017, Woodland Park Partners, LLC, a newly formed subsidiary of the Partnership, purchased the Woodland Park Apartments, a 126-unit apartment complex located at 264-290 Grove Street, Newton, Massachusetts , for a purchase price of $45,600,000. The closing costs were approximately $64,000. From the purchase price, the Partnership allocated approximately $541,000 for in-place leases, and approximately $42,000 to the value of tenant relationships.These amounts are being amortized over 12  and 24 months respectively. To fund the purchase price, the Partnership borrowed $25,000,000 under its outstanding line of credit with KeyBank, NA, and $16,000,000 from HBC Holdings, LLC, a Massachusetts limited liability company controlled by Harold Brown. The loan from HBC Holdings will mature on July 16, 2018, with interest only at 4.75%.The balance of the purchase price was funded by the Partnership’s cash reserves.   

On September 29, 2017, Woodland Park Partners LLC, ( “Woodland Park”), entered into a Multifamily Loan and Security Agreement with KeyBank National Association . The manager of Woodland Park is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Woodland Park. The Loan Agreement provides for a term loan in the principal amount of $22,250,000.  The Loan is due on October 1, 2027 , unless the due date is accelerated in accordance with the Loan’s terms, with interest only through October 1, 2022. Borrowings under the Loan will bear interest at the rate of 3.79%. The proceeds of the loan was used to pay off the loan from HBC Holdings, LLC and pay down the line of credit by $8,000,000.

On March 9, 2018, Hamilton Highlands, LLC (“Buyer”), a Massachusetts limited liability company whose manager is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”) entered into a purchase and sale agreement (the “Purchase Agreement”) with Webster Green Apartments LLC, a Massachusetts limited liability company (the “Seller”) to acquire Webster Green Apartments,  a 79 unit

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apartment complex located at 755-757 Highland Avenue, Needham,  Massachusetts. See NOTE 18-SUBSEQUENT EVENTS.

In January, 2016, the Partnership obtained a mortgage loan on the property at Captain Parker and used the proceeds of the loan and cash reserves to paydown the line of credit to zero. The Loan Agreement provides for a term loan in the principal amount of $20,071,000.  The Loan is due on February 1, 2026 , unless the due date is accelerated in accordance with the Loan’s terms. Borrowings under the Loan will bear interest at rates equal to (i) the one month LIBOR rate for United States Dollar Deposits, determined monthly, plus 201 basis points. The interest rate increases upon an event of default. 

In March of 2015, the Board of Advisors and Board of Directors  unanimously approved an extension of the Repurchase Program from 2015 to 2020 and increased the depositary receipt buy‑back allocation from 1.5 million to 2 million receipts. Management believes that the $25,000,000 line of credit, net cash flow from operations and cash on hand have put the Partnership in position to capitalize on investment opportunities should they reveal themselves in the near future. Management will continue to repurchase shares per its trading plan. As always, Management continues to weigh investment alternatives of stock repurchase, new property acquisitions and dispositions when considering its cash balances and performance of the portfolio.

The Stock Repurchase Program that was initiated in 2007 has purchased 1,365,306 Depositary Receipts through March 9, 2018 representing 32% of the outstanding class A Depositary Receipts. For 2017, Management has used existing cash reserves to purchase 549 Depository Receipts for a cost of $34,038. The Partnership has retained The Hamilton Company (“Hamilton”) to manage and administer the Partnership’s and Joint Ventures’ Properties. Hamilton is a full‑service real estate management company, which has legal, construction, maintenance, architectural, accounting and administrative departments. The Partnership’s properties represent approximately 37% of the total properties and 38% of the residential properties managed by Hamilton. Substantially all of the other properties managed by Hamilton are owned, wholly or partially, directly or indirectly, by Harold Brown. The Partnership’s Second Amended and Restated Contract of Limited Partnership (the “Partnership Agreement”) expressly provides that the general partner may employ a management company to manage the properties, and that such management company may be paid a fee of up to 4% of rental receipts for administrative and management services (the “Management Fee”). The Partnership pays Hamilton the full annual Management Fee, in monthly installments.

At March 9, 2018, Harold Brown, his brother Ronald Brown and the President of Hamilton, Carl Valeri, collectively own approximately 33% of the Depositary Receipts representing the Partnership Class A Units (including Depositary Receipts held by trusts for the benefit of such persons’ family members). Harold Brown also controls 75% of the Partnership’s Class B Units, 75% of the capital stock of NewReal, Inc. (“NewReal”), the Partnership’s sole general partner, and all of the outstanding stock of Hamilton. Ronald Brown also owns 25% of the Partnership’s Class B Units and 25% of NewReal’s capital stock. In addition, Ronald Brown is the President and director of NewReal and Harold Brown is NewReal’s Treasurer and a director. The 75% of the issued and outstanding Class B units of the Partnership, controlled by Harold Brown, are owned by HBC Holdings LLC, an entity of which he is the manager.

In addition to the Management Fee, the Partnership Agreement further provides for the employment of outside professionals to provide services to the Partnership and allows NewReal to charge the Partnership for the cost of employing professionals to assist with the administration of the Partnership’s properties. Additionally, from time to time, the Partnership pays Hamilton for repairs and maintenance services, legal services, construction services and accounting services. The costs charged by Hamilton for these services are at the same hourly rate charged to all entities managed by Hamilton, and management believes such rates are competitive in the marketplace.

Residential tenants sign a one year lease. In 2017, tenant renewals were approximately 63% with an average rental increase of approximately 3.9 %, new leases accounted for approximately 37% with rental rate increases of approximately 3.9%. In 2017, leasing commissions were approximately $370,000 compared to approximately $378,000 in 2016, a decrease of approximately $8,000 (2.1%) from 2016. Tenant concessions were approximately $41,000 in 2017 compared to approximately $49,000 in 2016, a decrease of approximately $8,000 (16.3%). Tenant improvements were approximately $2,657,000 in 2017 compared to approximately $2,116,000 in 2016, an increase of approximately $541,000 (25.6%).

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Hamilton accounted for approximately 3.5% of the repair and maintenance expense paid for by the Partnership in the year ended December 31, 2017 and 5.3% in the year ended December 31, 2016. Of the funds paid to Hamilton for this purpose, the great majority was to cover the cost of services provided by the Hamilton maintenance department, including plumbing, electrical, carpentry services, and snow removal for those properties close to Hamilton’s headquarters. Several of the larger Partnership properties have their own maintenance staff. Those properties that do not have their own maintenance staff and are located more than a reasonable distance from Hamilton’s headquarters in Allston, Massachusetts are generally serviced by local, independent companies.

Hamilton’s legal department handles most of the Partnership’s eviction and collection matters. Additionally, it prepares most long‑term commercial lease agreements and represents the Partnership in selected purchase and sale transactions. Overall, Hamilton provided approximately 82.3% and 83.6% of the legal services paid for by the Partnership during the years ended December 31, 2017 and 2016, respectively.

Additionally, as described in Note 3 to the consolidated financial statements, The Hamilton Company receives similar fees from the Investment Properties.

The Partnership requires that three bids be obtained for construction contracts in excess of $15,000. Hamilton may be one of the three bidders on a particular project and may be awarded the contract if its bid and its ability to successfully complete the project are deemed appropriate. For contracts that are not awarded to Hamilton, Hamilton charges the Partnership a construction supervision fee equal to 5% of the contract amount. Hamilton’s architectural department also provides services to the Partnership on an as‑needed basis. In 2017, Hamilton provided the Partnership approximately $227,000 in construction and architectural services, compared to $204,000 for the year ended December 31, 2016.

Bookkeeping and accounting functions have been provided by Hamilton’s accounting staff, which consists of approximately 14 people. In 2017, Hamilton charged the Partnership $125,000 per year ($31,250 per quarter) for bookkeeping and accounting services. For more information on related party transactions, see Note 3 to the Consolidated Financial Statements.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of the consolidated financial statements, in accordance with accounting principles generally accepted in the United States of America, requires the Partnership to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. The Partnership regularly and continually evaluates its estimates, including those related to acquiring, developing and assessing the carrying values of its real estate properties and its investments in and advances to joint ventures. The Partnership bases its estimates on historical experience, current market conditions, and on various other assumptions that are believed to be reasonable under the circumstances. However, because future events and their effects cannot be determined with certainty, the determination of estimates requires the exercise of judgment. The Partnership’s critical accounting policies are those which require assumptions to be made about such matters that are highly uncertain. Different estimates could have a material effect on the Partnership’s financial results. Judgments and uncertainties affecting the application of these policies and estimates may result in materially different amounts being reported under different conditions and circumstances. See Note 1 to the Consolidated Financial Statements, Principles of Consolidation.

Revenue Recognition:  Rental income from residential and commercial properties is recognized over the term of the related lease. For residential tenants, amounts 60 days in arrears are charged against income. The commercial tenants are evaluated on a case by case basis. Certain leases of the commercial properties provide for increasing stepped minimum rents, which are accounted for on a straight‑line basis over the term of the lease. Concessions made on residential leases are also accounted for on the straight‑line basis.

RentalPropertyHeld  for sale: When assets are identified by management as held for sale, the Partnership discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. The Partnership generally considers assets to be held for sale when the transaction has received appropriate corporate authority, and there are no significant contingencies relating to the sale. If, in management’s opinion, the estimated net sales price, net of selling costs, of the assets which have been identified as held for sale is less than the carrying value of the assets, a valuation allowance is established.

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If circumstances arise that previously were considered unlikely and, as a result, the Partnership decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying value before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.

Rental Properties:  Rental properties are stated at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred; improvements and additions are capitalized. When assets are retired or otherwise disposed of, the cost of the asset and related accumulated depreciation is eliminated from the accounts, and any gain or loss on such disposition is included in income. Fully depreciated assets are removed from the accounts. Rental properties are depreciated by both straight‑line and accelerated methods over their estimated useful lives. Upon acquisition of rental property, the Partnership estimates the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities assumed, generally consisting of the fair value of (i) above and below market leases, (ii) in‑place leases and (iii) tenant relationships. The Partnership allocated the purchase price to the assets acquired and liabilities assumed based on their fair values. The Partnership records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed exceed the purchase consideration of a transaction. In estimating the fair value of the tangible and intangible assets acquired, the Partnership considers information obtained about each property as a result of its due diligence and marketing and leasing activities, and utilizes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.

Intangible assets acquired include amounts for in‑place lease values above and below market leases and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Partnership’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in‑place lease values include an estimate of carrying costs during hypothetical expected lease‑up periods considering current market conditions, and costs to execute similar leases at market rates during the expected lease‑up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. Characteristics considered by management in valuing tenant relationships include the nature and extent of the Partnership’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of in‑ place leases are amortized to expense over the remaining initial terms of the respective leases. The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.

In the event that facts and circumstances indicate that the carrying value of a rental property may be impaired, an analysis of the value is prepared. The estimated future undiscounted cash flows are compared to the asset’s carrying value to determine if a write‑down to fair value is required.

Impairment:  On an annual basis management assesses whether there are any indicators that the value of the Partnership’s rental properties may be impaired. A property’s value is impaired only if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property over the fair value of the property. The Partnership’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved.

Investments in Joint Ventures:  The Partnership accounts for its 40%‑50% ownership in the Investment Properties under the equity method of accounting, as it exercises significant influence over, but does not control these entities. These investments are recorded initially at cost, as Investments in Joint Ventures, and subsequently adjusted for the Partnership’s share in earnings, cash contributions and distributions. Under the equity method of accounting, our net

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equity is reflected on the consolidated balance sheets, and our share of net income or loss from the Partnership is included on the consolidated statements of income. Generally, the Partnership would discontinue applying the equity method when the investment (and any advances) is reduced to zero and would not provide for additional losses unless the Partnership has guaranteed obligations of the venture or is otherwise committed to providing further financial support for the investee. If the venture subsequently generates income, the Partnership only recognizes its share of such income to the extent it exceeds its share of previously unrecognized losses.

The authoritative guidance on consolidation provides guidance on the identification of entities for which control            is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and the determination of which business enterprise, if any, should consolidate the VIE (the “primary beneficiary”). Generally, the consideration of whether an entity is a VIE applies when either (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest, (2) the equity investment at risk is insufficient to finance that equity’s activities without additional subordinated financial support or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The primary beneficiary is defined by the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the variable interest entity’s performance; and (2) the obligation to absorb losses and rights to receive the returns from VIE that would be significant to the VIE.

With respect to investments in and advances to the Investment Properties, the Partnership looks to the underlying properties to assess performance and the recoverability of carrying amounts for those investments in a manner similar to direct investments in real estate properties. An impairment charge is recorded if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property.

Legal Proceedings:  The Partnership is subject to various legal proceedings and claims that arise, from time to time, in the ordinary course of business. These matters are frequently covered by insurance. If it is determined that a loss is likely to occur, the estimated amount of the loss is recorded in the financial statements. Both the amount of the loss and the point at which its occurrence is considered likely can be difficult to determine.

RESULTS OF OPERATIONS

Years Ended December 31, 2017 and December 31, 2016

The Partnership and its Subsidiary Partnerships earned income before interest expense, income from investments in unconsolidated joint ventures and other income and loss of approximately $14,145,0000 during the year ended December 31, 2017, compared to approximately $13,260,000 for the year ended December 31, 2016,  an increase of  approximately $885,000 (6.7%).

The rental activity is summarized as follows:

	Occupancy Date
	February 1, 2018		February 1, 2017
Residential
Units	2,651		2,525
Vacancies	46		34
Vacancy rate	1.7	%	1.4	%
Commercial
Total square feet	108,043		108,043
Vacancy	—		—
Vacancy rate	0.0	%	0.0	%

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	Rental Income (in thousands)
	Year Ended December 31,
	2017						2016
	Total			Continuing			Total			Continuing
	Operations			Operations			Operations			Operations
Total rents	$	52,370		$	52,370		$	49,122		$	49,122
Residential percentage		93	%		93	%		93	%		93	%
Commercial percentage		7	%		7	%		7	%		7	%
Contingent rentals	$	642		$	642		$	616		$	616

Year Ended December 31, 2017 Compared to Year Ended December 31, 2016:

	Year Ended December 31,				Dollar		Percent
	2017		2016		Change		Change
Revenues
Rental income	$	52,370,221	$	49,121,705	$	3,248,516	6.6%
Laundry and sundry income		457,167		433,385		23,782	5.5%
		52,827,388		49,555,090		3,272,298	6.6%
Expenses
Administrative		2,008,107		2,102,812		(94,705)	(4.5%)
Depreciation and amortization		13,462,395		12,181,396		1,280,999	10.5%
Management fee		2,159,458		2,029,171		130,287	6.4%
Operating		5,227,502		4,822,921		404,581	8.4%
Renting		632,232		636,803		(4,571)	(0.7%)
Repairs and maintenance		8,378,639		8,258,263		120,376	1.5%
Taxes and insurance		6,814,089		6,263,774		550,315	8.8%
		38,682,422		36,295,140		2,387,282	6.6%
Income Before Other Income  (Expense)		14,144,966		13,259,950		885,016	6.7%
Other Income (Expense)
Interest income		1,284		1,025		259	25.3%
Interest expense		(11,114,146)		(10,200,393)		(913,753)	9.0%
Income from investments in unconsolidated joint ventures		3,905,827		1,785,827		2,120,000	118.7%
Gain on sale of real estate		—		104,443		(104,443)	(100.0%)
		(7,207,035)		(8,309,098)		1,102,063	(13.3%)
Net Income	$	6,937,931	$	4,950,852	$	1,987,079	40.1%

Including the new purchase of Woodland Park, rental income from continuing operations for the year ended December 31, 2017 was approximately $52,370,000, compared to approximately $49,122,000 for the year ended December 31, 2016, an increase of approximately $3,249,000 (6.6%). The factors that can be attributed to this increase are as follows: the acquisition of Woodland Park resulted in an increase in rental income of approximately $1,270,000. In addition, rental income has increased at a number of properties due to increased demand and increases in rental rates of approximately 3.9%. The Partnership Properties with the most significant increases in rental income include 1144 Commonwealth Street, Hamilton Oaks,Westgate Apartments,  62 Boylston Street, School Street 9 Associates, and Westside Colonial with increases of approximately $274,000, $241,000, $222,000, $186,000, $183,000 and $145,000 respectively. Included in rental income is contingent rentals collected on commercial properties. Contingent rentals include such charges as bill backs of common area maintenance charges, real estate taxes, and utility charges.

Total expenses from continuing operations for the year ended December 31, 2017 were approximately $38,682,000 compared to approximately $36,295,000 for the year ended December 31, 2016, an increase of approximately $2,387,000 (6.6%). Excluding the increase in operating expenses attributable to the acquisition of Woodland Park of approximately $1,809,000, operating expenses increased approximately $578,000 (1.6%). Excluding Woodland Park, factors which contributed to the increase in operating expenses were an increase in real estate taxes and insurance of approximately $410,000 (6.6%), due primarily to an increase in real estate taxes,  an increase  in operating  

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expenses of approximately $313,000 (6.5%) primarily due to an increase in utility costs, partially offset by a decrease in administrative costs of approximately $133,000 (6.3%), primarily due to a decrease in administrative service fees.

Interest expense for the year ended December 31, 2017 was approximately $11,114,000 compared to approximately $10,200,000 for the year ended December 31, 2016, an increase of approximately $914,000 (9.0%). Excluding the increase in interest expense attributable to Woodland Park of approximately $406,000, there was  an increase in interest expense of approximately $508,000, primarily due to an increase of approximately $486,000 in the utilization of the line of credit, and an increase of approximately $128,000 for the interest on the mortgage for Captain Parker, partially offset by a decrease in interest expense on several mortgages due to the paydown of principal during 2017.

At December 31, 2017, the Partnership has between a 40% and 50% ownership interests in nine different Investment Properties. See a description of these properties included in the section titled Investment Properties as well as Note 14 to the Consolidated Financial Statements for a detail of the financial information of each Investment Property.

As described in Note 14 to the Consolidated Financial Statements, the Partnership’s share of the net income  from the Investment Properties was approximately $3,906,000 for the year ended December 31, 2017, compared to a net income of approximately $1,786,000 for the year ended December 31, 2016, an increase in income of approximately $2,120,000 (118.7%). This increase is primarily due to a gain on the sale of real estate of approximately $6,141,000 on the sale of 29 units at Hamilton Bay Apartments LLC,  20 units at Hamilton 1025 LLC, and 1 unit at  Hamilton Bay LLC, compared  to a net gain of approximately $1,661,000 on the sale of 10 units at Hamilton 1025 and 4 units at Hamilton Bay LLC in 2016. Included in the income for the year ended December 31, 2017 is depreciation and amortization expense of approximately $2,605,000. The allocable income for the year ended December 31, 2017 from the investment in Dexter Park is approximately $737,000.

Interest income for the year ended December 31, 2017 was approximately $1,300 compared to approximately $1,000 for the year ended December 31, 2016, an increase of approximately $300.

As a result of the changes discussed above, net income for the year ended December 31, 2017 was approximately $6,938,000 compared to income of approximately $4,951,000 for the year ended December 31, 2016, an increase in income of approximately $1,987,000 (40.1%).

Years Ended December 31, 2016 and December 31, 2015

The Partnership and its Subsidiary Partnerships earned income before interest expense, income from investments in unconsolidated joint ventures and other income and loss of approximately $13,260,000 during the year ended December 31, 2016, compared to approximately $12,883,000 for the year ended December 31, 2015, an increase of  approximately $377,000 (2.9%).

The rental activity is summarized as follows:

	Occupancy Date
	February 1, 2017		February 1, 2016
Residential
Units	2,525		2,525
Vacancies	34		41
Vacancy rate	1.4	%	1.6	%
Commercial
Total square feet	108,043		108,043
Vacancy	—		—
Vacancy rate	0.0	%	0.0	%

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	Rental Income (in thousands)
	Year Ended December 31,
	2016						2015
	Total			Continuing			Total			Continuing
	Operations			Operations			Operations			Operations
Total rents	$	49,122		$	49,122		$	45,075		$	45,075
Residential percentage		93	%		93	%		92	%		92	%
Commercial percentage		7	%		7	%		8	%		8	%
Contingent rentals	$	616		$	616		$	683		$	683

Year Ended December 31, 2016 Compared to Year Ended December 31, 2015:

	Year Ended December 31,				Dollar		Percent
	2016		2015		Change		Change
Revenues
Rental income	$	49,121,705	$	45,074,655	$	4,047,050	9.0%
Laundry and sundry income		433,385		406,059		27,326	6.7%
		49,555,090		45,480,714		4,074,376	9.0%
Expenses
Administrative		2,102,812		2,096,290		6,522	0.3%
Depreciation and amortization		12,181,396		10,562,707		1,618,689	15.3%
Management fee		2,029,171		1,869,977		159,194	8.5%
Operating		4,822,921		4,939,662		(116,741)	(2.4%)
Renting		636,803		487,225		149,578	30.7%
Repairs and maintenance		8,258,263		6,998,592		1,259,671	18.0%
Taxes and insurance		6,263,774		5,643,507		620,267	11.0%
		36,295,140		32,597,960		3,697,180	11.3%
Income Before Other Income ( Expense)		13,259,950		12,882,754		377,196	2.9%
Other Income (Expense)
Interest income		1,025		1,596		(571)	(35.8%)
Interest (expense)		(10,200,393)		(9,980,359)		(220,034)	2.2%
Income (Loss) from investments in unconsolidated joint ventures		1,785,827		868,574		917,253	105.6%
Gain on sale of real estate		104,443		—		104,443	—
		(8,309,098)		(9,110,189)		801,091	(8.8%)
Net Income	$	4,950,852	$	3,772,565	$	1,178,287	31.2%

Rental income from continuing operations for the year ended December 31, 2016 was approximately $49,122,000, compared to approximately $45,075,000 for the year ended December 31, 2015, an increase of approximately $4,047,000 (9.0%). The two main factors which can be attributed to this increase are as follows; rental income in 2016 at Captain Parker is for the entire year versus three and one half months of rental income in 2015, resulting in an increase of approximately $1,777,000 and rental rate increases of approximately 4.9% in 2016. The Partnership Properties with the most significant increases in rental income, excluding Captain Parker, include 1144 Commonwealth Street, Westgate Apartments, 9 School Street, 62 Boylston Street, Hamilton Oaks and Westside Colonial with increases of approximately $312,000, $288,000, $233,000, $218,000, $189,000 and $183,000 respectively. Included in rental income is contingent rentals collected on commercial properties. Contingent rentals include such charges as bill backs of common area maintenance charges, real estate taxes, and utility charges.

Total expenses from continuing operations for the year ended December 31, 2016 were approximately $36,295,000 compared to approximately $32,598,000 for the year ended December 31, 2015, an increase of approximately $3,697,000 (11.3%). The most significant factor contributing to this increase was the operating expenses for Captain Parker for the entire year in 2016 versus three and one half months of operating expenses in 2015, an increase of approximately $1,944,000. Excluding Captain Parker, factors which contributed to the increase in operating expenses were an increase in repairs and maintenance expenses of approximately $1,020,000 (14.7%) due to repairs at the properties to maintain occupancy; an increase in taxes and insurance expense of approximately $430,000 (7.7%) due

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primarily to an increase in real estate taxes; and an increase in depreciation and amortization expense of approximately $427,000 (4.7%) due to an increase of depreciable fixed assets, partially offset by a decrease  in operating expenses of approximately $356,000 (7.3%) primarily due to a decrease in snow removal costs.

Interest expense for the year ended December 31, 2016 was approximately $10,200,000 compared to approximately $9,980,000 for the year ended December 31, 2015, an increase of approximately $220,000 (2.2%). Approximately $518,000 of this increase represents the interest on the mortgage on Captain Parker, partially offset by a decrease in interest expense on the Line of Credit of approximately $273,000.

At December 31, 2016, the Partnership has between a 40% and 50% ownership interests in nine different Investment Properties. See a description of these properties included in the section titled Investment Properties as well as Note 14 to the Consolidated Financial Statements for a detail of the financial information of each Investment Property.

As described in Note 14 to the Consolidated Financial Statements, the Partnership’s share of the net income  from the Investment Properties was approximately $1,786,000 for the year ended December 31, 2016, compared to a net income of approximately $869,000 for the year ended December 31, 2015, an increase in income of approximately $917,000 (105.6%). The increase is primarily due to a net gain of approximately $1,661,000 on the sale of 10 units at Hamilton 1025 and 4 units at Hamilton Bay LLC, compared to a gain of approximately $169,000 on the sale of 2 units at Hamilton Bay LLC in 2015. Included in the income for the year ended December 31, 2016 is depreciation and amortization expense of approximately $2,602,000. The allocable income for the year ended December 31, 2016 associated with the October 2009 investment in Dexter Park is approximately $739,000 of which approximately $1,305,000 is depreciation and amortization.

Interest income for the year ended December 31, 2016 was approximately $1,000 compared to approximately $1,600 for the year ended December 31, 2015, a decrease of approximately $600.

As a result of the changes discussed above, net income for the year ended December 31, 2016 was approximately $4,951,000 compared to income of approximately $3,773,000 for the year ended December 31, 2015, an increase in income of approximately $1,178,000 (31.2%).

LIQUIDITY AND CAPITAL RESOURCES    

The Partnership’s principal source of cash during 2017 and 2016 was the collection of rents and proceeds on the sale, financing, and refinancing of real estate. The majority of cash and cash equivalents of $7,238,905 at December 31, 2017 and $7,463,697 at December 31, 2016 were held in interest bearing accounts at creditworthy financial institutions.

This decrease in cash of $224,792 at December 31, 2017 is summarized as follows:

	Year Ended December 31,
	2017		2016
Cash provided by operating activities	$	16,138,112	$	15,342,225
Cash (used in) investing activities		(45,525,476)		(2,832,094)
Cash provided by (used in) financing activities		37,190,955		(6,979,996)
Repurchase of Depositary Receipts, Class B and General Partner Units		(42,548)		(1,634,945)
Distributions paid		(7,985,835)		(6,729,679)
Net (decrease)  in cash and cash equivalents	$	(224,792)	$	(2,834,489)

The cash provided by operating activities is primarily due to the collection of rents less cash operating expenses. The decrease in cash used in investing activities is due primarily to the purchase of Woodland Park Apartments and the Partnership contributing $2,222,000 to pay off the principal of the mortgage on Hamilton Bay Apartments. The change in cash provided by financing activities is due to the proceeds of the $22,250,000 loan for Woodland Park Apartments, partially offset by the paydown of the $16,000,000 note due to HBC Holdings ,LLC, and a partial paydown on the Line of Credit  of $8,000,000. During the year ended December 31, 2017, the Partnership purchased 549 Depositary Receipts

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for an average price of $62.00 for a total cost of $34,038; 4.3 Class B Units for a cost of $8,084 and 0.2 General Partnership Units for a cost of $426, for a total cost of $42,548.

During 2017, the Partnership and its Subsidiary Partnerships completed improvements to certain of the Properties at a total cost of approximately $5,795,000. These improvements were funded from cash reserves and, to some extent, escrow accounts established in connection with the financing or refinancing of the applicable Properties. These sources have been adequate to fully fund improvements. The most significant improvements were made at 1144 Commonwealth Apartments, Redwood Hills, 62 Boylston Street, School Street 9 Associates, Woodland Park, and Westside Colonial, at a cost of $949,000, $662,000, $635,000, $626,000, $542,000, and $406,000 respectively. The Partnership plans to invest approximately $3,447,000 in capital improvements in 2018.

On July 6, 2017, Woodland Park Partners, LLC, a newly formed subsidiary of the Partnership, purchased the Woodland Park Apartments, a 126-unit apartment complex located at 264-290 Grove Street, Newton, Massachusetts, for a purchase price of $45,600,000.

To fund the purchase price, the Partnership borrowed $25,000,000 under its outstanding line of credit with KeyBank, NA, and $16,000,000 from HBC Holdings, LLC, a Massachusetts limited liability company controlled by Harold Brown. The loan from HBC Holdings will mature on July 16, 2018, with interest only at 4.75%.  The balance of the purchase price was funded by the Partnership’s cash reserves. The Partnership paid off the loan of HBC Holdings on September 29, 2017, and the total interest paid  on the loan was approximately $182,000.

On September 29, 2017, Woodland Park Partners LLC, , entered into a Multifamily Loan and Security Agreement with KeyBank National Association . The manager of Woodland Park is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Woodland Park. The Loan Agreement provides for a term loan in the principal amount of $22,250,000.  The Loan is due on October 1, 2027 , unless the due date is accelerated in accordance with the Loan’s terms, with interest only through October 1, 2022. Borrowings under the Loan will bear interest at the rate of 3.79%.

During the year ended December 31, 2017, the Partnership received distributions of approximately $8,006,000 from the investment properties of which $1,400,000 was from Dexter Park.

In 2017, the Partnership paid a total distribution of an aggregate $64.50 per Unit ($2.15 per Receipt) for a total payment of $7,985,835 in 2017. In 2016, the Partnership paid four quarterly distributions of an aggregate of $54.00 per Unit ($1.80 per Receipt) for a total payment of $6,729,679. In January 2018, the Partnership approved a quarterly distribution of $9.00 per Unit ($0.30 per Receipt), payable on March 31, 2018.

On January 7, 2016, Captain Parker entered into a Multifamily Loan and Security Agreement with KeyBank National Association . The Loan Agreement provides for a term loan in the principal amount of $20,071,000.  The Loan is due on February 1, 2026 (the “Due Date”), unless the due date is accelerated in accordance with the Loan’s terms. Borrowings under the Loan will bear interest at rates equal to (i) the one month LIBOR rate for United States Dollar Deposits, determined monthly, plus 201 basis points. The interest rate increases upon an event of default. 

As a result of securing the financing, the Partnership used the proceeds of the loan and cash reserves of the Partnership to pay down the Line of Credit to zero. A payment was made on January 7, 2016 for $23,000,000, and another payment for $2,000,000 was made on January 15, 2016.

On March 1, 2017, the mortgage on the property at Hamilton Bay Apartments, totaling $4,444,918, including both interest and principal, was paid off. The Partnership was required to contribute approximately $2,222,000 to the payment.

On July 8, 2016, Hamilton 1025 LLC paid off the outstanding balance of the mortgage balance. The Partnership made a capital contribution of $2,359,500 to Hamilton 1025, LLC for its share of the funds required for the transaction.

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On July 31, 2014, the Partnership entered into an agreement for a $25,000,000 revolving line of credit. The term of the line is three years with a floating interest rate equal to a base rate of the greater of (a) the Prime Rate (b) the Federal Funds Rate plus one‑half of one percent per annum, or (c) the LIBOR Rate for a period of one month plus 1% per annum, plus an applicable margin of 2.5%. On July 6, 2017, the credit line had an outstanding balance of $25,000,000, which was used  in conjunction with a loan of $16,000,000 from HBC Holdings, LLC, a Massachusetts Limited Liability company controlled by Harold Brown, and cash reserves, to purchase Woodland Park Partners, LLC (“Woodland Park”).The loan from HBC was paid off on September 29, 2017 from the proceeds of the loan from Keybank.The Line of Credit was paid down by $8,000,000 on October 5, 2017. The agreement originally expired on July 31, 2017, and was subsequently extended until October 31, 2020. The costs associated with the line of credit extension were approximately $128,000.  As of December 31, 2017, the credit line had an outstanding balance of $17,000,000. 

The Partnership anticipates that cash from operations and interest bearing accounts will be sufficient to fund its current operations, pay distributions, make required debt payments and to finance current improvements to its properties. The Partnership may also sell or refinance properties. The Partnership’s net income and cash flow may fluctuate dramatically from year to year as a result of the sale or refinancing of properties, increases or decreases in rental income or expenses, or the loss of significant tenants.

Off‑Balance Sheet Arrangements—Joint Venture Indebtedness

As of December 31, 2017, the Partnership had a 40%‑50% ownership interest in nine Joint Ventures, which all have mortgage indebtedness except Hancock 1025, Hamilton Bay Sales and Hamilton Essex Development. We do not have control of these partnerships and therefore we account for them using the equity method of consolidation. At December 31, 2017, our proportionate share of the non‑recourse debt before unamortized deferred financing costs related to these investments was approximately $54,123,000. See Note 14 to the Consolidated Financial Statements.

Contractual Obligations

As of December 31, 2017, we are subject to contractual payment obligations as described in the table below.

	Payments due by period
		2018		2019		2020		2021		2022		Thereafter		Total
Contractual Obligations
Long -term debt
Mortgage debt	$	7,842,753	$	1,923,459	$	4,330,794	$	2,449,008	$	2,686,168	$	215,397,493	$	234,629,675
Line of Credit		—		—		17,000,000		—		—		—		17,000,000
Total Contractual Obligations	$	7,842,753	$	1,923,459	$	21,330,794	$	2,449,008	$	2,686,168	$	215,397,493	$	251,629,675

We have various standing or renewable service contracts with vendors related to our property management. In addition, we have certain other contracts we enter into in the ordinary course of business that may extend beyond one year. These contracts are not included as part of our contractual obligations because they include terms that provide for cancellation with insignificant or no cancellation penalties.

See Notes 5 and 14 to the Consolidated Financial Statements for a description of mortgage notes payable. The Partnership has no other material contractual obligations to be disclosed.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the exposure to loss resulting from changes in interest rates and equity prices. In pursuing its business plan, the primary market risk to which the Partnership is exposed is interest rate risk. Changes in the general level of interest rates prevailing in the financial markets may affect the spread between the Partnership’s yield on invested assets and cost of funds and, in turn, its ability to make distributions or payments to its investors.

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As of December 31, 2017, the Partnership, its Subsidiary Partnerships and the Investment Properties collectively have approximately $376,277,000 in long-term debt, substantially all of which require payment of interest at fixed rates. Accordingly, the fair value of these debt instruments is affected by changes in market interest rates. This long term debt matures through 2029. Including the line of credit, the Partnership, its Subsidiary Partnerships and the Investment Properties collectively have variable rate debt of $47,071,000 as of December 31, 2017 ranged from LIBOR plus 201 basis points to LIBOR plus 350 basis points. Assuming interest- rate caps are not in effect, if market rates of interest on the Partnership’s variable rate debt increased or decreased by 100 basis points, then the increase or decrease in interest costs on the Partnership’s variable rate debt would be approximately $421,000 annually and the increase or decrease in the fair value of the Partnership’s fixed rate debt as of December 31, 2017 would be approximately $16 million. For information regarding the fair value and maturity dates of these debt obligations,  See Note 5 to the Consolidated Financial Statements — “Mortgage Notes Payable,” Note 12 to the Consolidated Financial Statements — “Fair Value Measurements” and Note 14 to the Consolidated Financial Statements — “Investment in Unconsolidated Joint Ventures.”

For additional disclosure about market risk, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Factors That May Affect Future Results”.

ITEM 8.  CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements of the Partnership appear on pages F‑1 through F‑35 of this Form 10‑K and are indexed herein under Item 15(a)(1).

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A.  CONTROLS AND PROCEDURES

Disclosure Controls and Procedures.  We have evaluated the design and operation of our disclosure controls and procedures to determine whether they are effective in ensuring that the disclosure of required information is timely made in accordance with the Securities Exchange Act of 1934 (“Exchange Act”) and the rules and forms of the Securities and Exchange Commission. This evaluation was made under the supervision and with the participation of management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) of our General Partner as of the end of the period covered by this annual report on Form 10‑K. The CEO and CFO have concluded, based on their reviews, that our disclosure controls and procedures, as defined in Exchange Act Rules 13a‑15(e), are effective to ensure that information required to be disclosed by us in reports that we file under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.

Management’s Report on Internal Control over Financial Reporting.  We are responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a‑15(f) and 15‑15(f) under the Exchange Act. We assessed the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in “Internal Control—Integrated Framework (2013)”. Based on that assessment and those criteria, our management, with the participation of the CEO and CFO of the General Partner concluded that our internal control over financial reporting is effective as of December 31, 2017.

We believe that because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, 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.

The effectiveness of the Partnership’s internal control over financial reporting as of December 31, 2017 has been audited by Miller Wachman LLP, an independent registered public accounting firm, as stated in their report which appears herein.

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Changes in Internal Control over Financial Reporting.  There were no changes in our internal control over financial reporting during the fourth quarter of 2017 that materially affected or are reasonably likely to materially affect our internal control over financial reporting.

ITEM 9B.  OTHER INFORMATION 

Not applicable

PART III

ITEM 10.  DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Our General Partner, New Real, Inc. is a Massachusetts corporation wholly owned by Harold Brown and Ronald Brown, who are brothers. Harold Brown and Ronald Brown were individual general partners of the Partnership until May 1984, when NewReal, Inc. replaced them as the sole General Partner of the Partnership. The General Partner is responsible for making all decisions and taking all action deemed by it necessary or appropriate to conduct the business of the Partnership.

The General Partner engages The Hamilton Company, Inc. to manage the properties of the Partnership and its Subsidiary Partnerships. The Hamilton Company, Inc. is wholly owned by Harold Brown. See “Item 11. Executive Compensation” for information concerning fees paid by the Partnership to The Hamilton Company during 2017.

Because the General Partner has engaged The Hamilton Company as the manager for the Properties, the General Partner has no employees.

The directors of the General Partner are Ronald Brown, Harold Brown, Guilliaem Aertsen, David Aloise, and Eunice Harps. The directors of the General Partner hold office until their successors are duly elected and qualified.

Ronald Brown and Harold Brown hold all of the executive officer positions of the General Partner. The executive officers of the General Partner serve at the pleasure of the Board of Directors.

On June 14, 2001, the Board of Directors of the General Partner created an Audit Committee, in accordance with Section 3(a)(58)(A) of the Exchange Act, consisting of three members, and approved the charter of the Audit Committee. As of July 1, 2014, the Audit Committee consisted of Guilliaem Aertsen, David Aloise, and Eunice Harps. The Board of Directors of the General Partner has determined that Guilliaem Aertsen is an audit committee financial expert, as that term is defined in Item 407 of Securities and Exchange Commission Regulation S‑K.

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The following table sets forth the name and age of each director and officer of the General Partner and each such person’s principal occupation and affiliation during the preceding five years.

Name and Position	Age	Other Position
Ronald Brown, President and Director (since 1984)	82	Co‑General Partner since the Partnerships formation in 1977. Associate, Hamilton Realty Company (since 1967); President, Treasurer, Clerk and Director of R. Brown Partners Inc. (since 1985), a real estate management company; Member, Greater Boston Real Estate Board (since 1981); Director, Brookline Chamber of Commerce (since 1978); Trustee of Reservations (since 1988); Director, Brookline Music School (1997‑2004); President, Brookline Chamber of Commerce (1990‑1992); Director, Coolidge Corner Theater Foundation (1990‑1993); President, Brookline Property Owner’s Association (1981‑1990); Trustee, Brookline Hospital (1982‑1989); Director, Brookline Symphony Orchestra (1996‑2002); Director and Treasurer, Brookline Greenspace Alliance (since 1999). Mr. Brown is a graduate of Northeastern University earning a B.A. degree in Mechanical Engineering and an M.S. degree in Engineering Management. Based on Mr. Brown’s ownership interest in the Partnership, ownership interest in the Partnership’s General Partner, years of experience in the real estate industry and as a long standing member of the Board of Directors of the General Partner, the Board of Directors concluded that Mr. Brown has the requisite experience, qualifications, attributes and skills necessary to serve as a member of the Board of Directors.
Harold Brown, Treasurer and Director (since 1984)	93	Co‑General Partner since the Partnerships formation in 1977. Sole proprietor, The Hamilton Company, Inc., manager and developer of residential and commercial real estate (since 1954); Trustee, Treasurer and Director of Wedgestone Realty Investors Trust (1982‑1985); Chairman of the Board and principal stockholder of the Wedgestone Advisory Corporation (1980‑1985); Director of AFC Financial Corp. (1983‑1985); Director, Coolidge Bank and Trust (1980‑1983). Mr. Brown is a graduate of the Massachusetts Institute of Technology. Based on Mr. Brown’s ownership interest in the Partnership, ownership interest in the Partnership’s General Partner, years of experience in the real estate industry and as a long standing member of the Board of Directors of the General Partner, the Board of Directors concluded that Mr. Brown has the requisite experience, qualifications, attributes and skills necessary to serve as a member of the Board of Directors.
Guilliaem Aertsen, IV, Director (since 2002)	70	Director and Chairman of the Partnership’s Audit Committee. Chief Executive Officer, Aertsen Ventures LLC (since 1999) a private venture capital firm focused on early stage companies engaged in technology, real estate and distressed financial assets; Director and CFO of CineCast LLC (2000‑2012); Member of Premier Capital LLC (since 2000); Chairman of the Board of Directors of the Massachusetts Housing Investment Corporation (since 1997) a partnership of corporate investors, housing sponsors and public agencies engaged in the financing of affordable housing and community development projects in Massachusetts and New England; Chairman of the Board of Trustees of the Old South Church (1992‑2002); Executive Vice President and member of the senior management group of BankBoston Corporation (1996‑ 1998); Executive and management assignments including corporate lending, real estate, capital markets, venture capital and asset management Bank Boston Corporation (1973‑1998). Mr. Aertsen is a graduate of Harvard University. Based on Mr. Aertsen’s familiarity with the Partnership as a member of the Board of Directors and as Chairman of the Audit Committee, his experience as a director with several other companies and his banking, management and financial expertise, the Board of Directors concluded that Mr. Aertsen has the requisite experience, qualifications, attributes and skills necessary to serve as a member of the Board of Directors.

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Name and Position	Age	Other Position
David Aloise, Director (since 2007)	63	Director and member of the Partnership’s Audit Committee. Founder and principal of Aloise & Associates, LLC (since 2000) a consulting firm that provides advisory, training and credit risk management services; BankBoston Corporation (1979‑2000) Director of Commercial Loan Workout, Managing Director Small Business Banking, Vice President Restructured Real Estate, Vice President C & I Loan Workout; Board of Trustees New England Banking Institute; Advisory Board Member Wells Fargo Retail Finance, LLC; Senior Advisor to Eaton Vance Bank Loan Mutual Fund Group; Member of the Turnaround Management Association. Mr. Aloise is a graduate of Boston College and the National Commercial Lending Graduate School, University of Oklahoma. Based on Mr. Aloise’s experience in banking, credit markets, small business management and business turnarounds, the Board of Directors concluded that Mr. Aloise has the requisite experience, qualifications, attributes and skills necessary to serve as a member of the Board of Directors.
Eunice Harps, Director (since 2014)	68	Director and member of the Partnership’s Audit Committee. Director of Credit Massachusetts Housing Investment Corporation (1999-2017) a private financier of affordable housing and community development throughout Massachusetts; BankBoston Corporation (1984‑1998) Vice President Senior Manager, Capital Markets Credit, Vice President, Troubled Debt Restructuring Team; Steering Committee NEWIRE (1993‑1995), Board of Directors Chair YW Boston; Board Member of Nuestra Comunidad Development Corporation (2015-2017). Ms. Harps is a graduate of Boston University earning a B.A. and M.B.A. degrees. Based on Ms. Harps’ experience in banking, credit review and affordable housing, the Board of Directors concluded that Ms. Harps has the requisite experience, qualifications, attributes and skills necessary to serve as a member of the Board of Directors.

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934 requires the Partnership’s directors, executive officers, and persons who own more than 10% of a registered class of the Partnership’s equity securities to file with the Securities and Exchange Commission reports of ownership changes and changes in ownership of the Partnership. Officers, directors and greater‑than‑10% shareholders are required by SEC regulations to furnish the Partnership with copies of all Section 16(a) forms they file.

Based solely upon a review of Forms 3 and 4 furnished to the Partnership under Rule 16a‑3(e) of the Securities Exchange Act during its most recent fiscal year, Forms 5 furnished to the Partnership with respect to its most recent fiscal year and any written representations received by the Partnership from persons required to file such forms, all of the following persons — either officers, directors or beneficial owners of more than ten percent of any class of equity of the company registered pursuant to Section 12 of the Securities Exchange Act — filed on a timely basis reports required by Section 16(a) of the Securities Exchange Act during the most recent fiscal year.

CODE OF ETHICS

The Partnership, its General Partner and Hamilton, the Partnership’s management company, have adopted a Code of Business Conduct and Ethics, which constitutes a “Code of Ethics” as defined by the SEC and applies to executive officers as well as to all other employees. A copy of the Code of Business Conduct and Ethics is available in the “NERA” section of the management company’s website at www.thehamiltoncompany.com. To the extent required by the rules of the SEC, the Partnership and its related entities will disclose amendments to and waivers from the Code of Business Conduct and Ethics in the same place on the aforementioned website.

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REPORT OF THE AUDIT COMMITTEE

The Audit Committee of NewReal Inc. (NewReal), which is the General Partner of New England Realty Associates Limited Partnership (“NERA” or the “Partnership”), is currently comprised of Guilliaem Aertsen, IV, David Aloise, and Eunice Harps, each of whom is an independent director of NewReal. The Audit Committee operates under a written charter.

The Partnership’s management, which consists of NERA’s General Partner, is responsible for the preparation of the Partnership’s financial statements and for maintaining an adequate system of internal controls and processes for that purpose. Miller Wachman LLP (“Miller Wachman”) acts as the Partnership’s independent auditor and is responsible for conducting an independent audit of the Partnership’s annual financial statements and the effectiveness of the Partnership’s internal control over financial reporting as of December 31, 2017 in accordance with the standards of the Public Company Accounting Oversight Board (United States), and issuing a report on the results of their audit. The Audit Committee is responsible for providing independent, objective oversight of both of these processes.

The Audit Committee has reviewed and discussed the audited financial statements for the year ended December 31, 2017 with management of the Partnership and with representatives of Miller Wachman. As a result of these discussions, the Audit Committee believes that NERA maintains an effective system of accounting controls that allow it to prepare financial statements that fairly present the Partnership’s financial position and results of its operations. Discussions with Miller Wachman also included the matters required by Statement on Auditing Standard No. 16 (Communications with Audit Committee).

In addition, the Audit Committee reviewed the independence of Miller Wachman. We received written disclosures and a letter from Miller Wachman regarding its independence as required by Independent Standards Board Standards No. 1 and discussed this information with Miller Wachman.

Based on the foregoing, the Audit Committee has recommended that the audited financial statements of the Partnership for the year ended December 31, 2017 be included in the Partnership’s annual report on form 10‑K to be filed with the Securities and Exchange Commission.

Guilliaem Aertsen, IV
David Aloise
Eunice Harps

ITEM 11.  EXECUTIVE COMPENSATION

The Partnership does not have “Executive Compensation.” As more fully described below, the Partnership employs a management company to which it pays management fees and administrative fees.

The Partnership is not required to and did not pay any compensation to its officers or the officers and directors of the General Partner in 2017. As more fully described below, the Partnership employs a management company which is solely responsible for performing all management and policy making functions for the Partnership. The only compensation paid by the Partnership to any person or entity is in the form of management fees and administrative fees paid to the General Partner, or any management entity employed by the General Partner, in accordance with the Partnership Agreement.

Specifically, the Partnership Agreement provides that the General Partner, or any management entity employed by the General Partner, is entitled to a management fee equal to 4% (2% at Dexter Park and 3% at Linewt) of the rental and other operating income from the Partnership Properties and a mortgage servicing fee equal to 0.5% of the unpaid principal balance of any debt instruments received, held and serviced by the Partnership (the “Management Fee”). The Partnership Agreement also authorizes the General Partner to charge to the Partnership its cost for employing professionals to assist with the administration of the Partnership Properties (the “Administrative Fees”). The Administrative Fee is not charged against the Management Fee. In addition, upon the sale or disposition of any Partnership Properties, the General Partner, or any management entity which is the effective cause of such sale, is

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entitled to a commission equal to 3% of the gross sale price (the “Commission”), provided that should any other broker be entitled to a commission in connection with the sale, the commission shall be the difference between 3% of the gross sale price and the amount to be paid to such broker.

The General Partner has engaged The Hamilton Company (“Hamilton”) to operate and manage the Partnership, and in accordance with the Partnership Agreement, the Management Fee, the Administrative Fees and the Commission are paid to Hamilton. See “Item 10. Directors and Executive Officers of the Registrant.” The total Management Fee paid to Hamilton during 2017 was approximately $2,159,000. The management services provided by Hamilton include but are not limited to: collecting rents and other income; approving, ordering and supervising all repairs and other decorations; terminating leases, evicting tenants, purchasing supplies and equipment, financing and refinancing properties, settling insurance claims, maintaining administrative offices and employing personnel. In addition, the Partnership engages the president of Hamilton as a consultant to provide asset management services to the Partnership, for which the Partnership paid $75,000 in 2017. The Partnership does not have a written agreement with this individual.

In 2017, the Partnership and its Subsidiary Partnerships paid administrative fees to Hamilton of approximately $882,000 inclusive of construction supervision and architectural fees of approximately $227,000, repairs and maintenance service fees of approximately $295,000, legal fees of approximately $234,000, brokerage fees of approximately $1,000 and $125,000 for accounting services. In addition,  the Partnership paid $24,000 to Ronald Brown for construction supervision services.

Additionally, the Hamilton Company received approximately $1,377,000 from the 40‑50% owned Investment Properties of which approximately $673,000 was the management fee, approximately $620,000 was for construction supervision and architectural fees, approximately $44,000 was for maintenance services, and $40,000 for legal services. The Advisory Committee held four meetings during 2017, and a total of $19,000 was paid for attendance and participation in such meetings. Additionally, the Audit Committee held four meetings in 2017 and a total of $12,000 was paid for attendance and participation in such meetings.

Compensation Committee Interlocks and Insider Participation

The Board of Directors of our General Partner does not have a compensation committee. No member of the Board of Directors of the General Partner was at any time in 2017 or at any other time an officer or employee of the General Partner, and no member had any relationship with the Partnership requiring disclosure as a related‑person transaction under Item 404 of Regulation S‑K. No officer of the General Partner has served on the board of directors or compensation committee of any other entity that has or has had one or more executive officers who served as a member of the Board of Directors of the General Partner at any time in 2017.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

As of March 1, 2018, except as listed below, the General Partner was not aware of any beneficial owner of more than 5% of the outstanding Class A Units or the Depositary Receipts, other than Computershare, which, under the Deposit Agreement, as Depositary, is the record holder of the Class A Units exchanged for Depositary Receipts. As of March 1, 2018, pursuant to the Deposit Agreement, Computershare was serving as the record holder of the Class A Units with respect to which 2,880,762 Depositary Receipts had been issued to approximately 1,666  holders. As of March 1, 2018, there were issued and outstanding 3,484 Class A Units (not including the Depositary Receipts) held by 154 unit holders, 23,633 Class B Units and 1,244 General Partnership Units held by the persons listed below. During 2017, 52 Class A Units were exchanged for Depositary Receipts.

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The following table sets forth certain information regarding each class of Partnership Units beneficially owned as of December 31, 2017 by (i) each person known by the Partnership to beneficially own more than 5% of any class of Partnership Units, (ii) each director and officer of the General Partner and (iii) all directors and officers of the General Partner as a group. For purposes of this table, all Depositary Receipts are included as if they were converted back into Class A Units. The inclusion in the table below of any Units deemed beneficially owned does not constitute an admission that the named persons are direct or indirect beneficial owners of such Units. Unless otherwise indicated, each person listed below has sole voting and investment power with respect to the Units listed.

	Class A				Class B				General Partnership
			% Of				% Of				% Of
	Number of		Outstanding		Number of		Outstanding		Number of		Outstanding
	Units		Units		Units		Units		Units		Units
	Beneficially		Beneficially		Beneficially		Beneficially		Beneficially		Beneficially
Directors and Officers	Owned		Owned		Owned		Owned		Owned		Owned
Harold Brown		(1)(2)		(1)(2)	17,725	(3)	75	%(3)		(4)	100	%(4)
c/o New England Realty Associates
Limited Partnership
39 Brighton Avenue
Allston, MA 02134
Harold Brown 2013 Revocable Trust		(2)		(2)	—		—		—		—
c/o Saul Ewing LLP
131 Dartmouth Street
Boston, MA 02116
HBC Holdings, LLC		(1)		(1)		(3)		(3)	—		—
39 Brighton Avenue
Allston, MA 02134
Ronald Brown	2,982	(5)	3.00	%(5)	5,908		25	%		(4)	100	%(4)
c/o New England Realty Associates
Limited Partnership
39 Brighton Avenue
Allston, MA 02134
Guilliaem Aertsen	—		—		—		—		—		—
175 West Brookline Street
Boston, MA 02118
David Aloise	—		—		—		—		—		—
241 Cottage Park Road
Winthrop, MA 02152
Eunice Harps	—		—		—		—		—		—
5 Holyoke Street #1
Boston, MA 02116
NewReal, Inc.	333		0.33	%	—		—		1,244		100	%
39 Brighton Avenue
Allston, MA 02134
All directors and officers as a group	25,663	(6)	25.79	%(6)	23,638	(7)	100	%(7)		(4)	100	%(4)
5% Owners that are not Directors and Officers
Carl Valeri	6,748	(8)	6.78	%(8)	—		—		—		—
50 Udine Street
Arlington, MA 02476
Harold Brown 2009 Irrevocable Trust	9,583	(9)	7.70	%(9)	—		—		—		—
39 Brighton Avenue
Alston, MA 02134

(1) As of December 31, 2017, 507,849 Depositary Receipts are held of record by the HBC Holdings, LLC (HBC). Harold Brown is the sole manager of HBC with sole voting and dispositive control over the Depositary Receipts. Accordingly, Mr. Brown may be deemed to beneficially own the Depositary Receipts held by HBC. Because a Depositary Receipt represents beneficial ownership of one‑thirtieth of a Class A Unit, Harold Brown may be deemed to beneficially own approximately 16,928 Class A Units (approximately 17.01% of the outstanding Class A Units).

(2) As of December 31, 2017, Harold Brown directly owns 162,600 Depositary Receipts beneficially owned by his spouse. Because a Depositary Receipt represents beneficial ownership of one‑thirtieth of a Class A Unit, Harold Brown may be deemed to directly beneficially own approximately 5,420  Class A Units (approximately 5.45 % of the outstanding Class A Units).

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(3) Consists of Class B Units held by HBC Holdings, LLC. See Note (1) above. Harold Brown, as Manager, has voting and investment power over the Class B Units held by the LLC, subject to the provisions of the LLC, and thus may be deemed to beneficially own the  Class B Units held by the LLC.

(4) Since Harold Brown and Ronald Brown are the controlling stockholders, executive officers and directors of NewReal, Inc., they may be deemed to beneficially own all  of the General Partnership Units held of record by NewReal, Inc.

(5) Consists of 89,460 Depositary Receipts held of record jointly by Ronald Brown and his wife. Because a Depositary Receipt represents beneficial ownership of one‑thirtieth of a Class A Unit, Ronald Brown may be deemed to beneficially own approximately 2,982 Class A Units.

(6) Consists of the Class A Units described in Notes (1) and (2)  above, plus New Real, Inc. and Ronald Brown, as indicated in the table.

(7) Includes the Class B Units described in Note (2) above.

(8) Consists of 202,440 Depositary Receipts held by Carl Valeri and his immediate family members. Because a Depositary Receipt represents beneficial ownership of one thirtieth of a Class A Unit, Carl Valeri may be deemed to beneficially own approximately 6,748 Class A Units.

(9) Consists of 287,500 Depositary Receipts held by the Harold Brown 2009 Irrevocable Trust. Harold Brown is not a beneficiary of the Trust and he does not have a pecuniary interest. Because a Depositary Receipt represents beneficial ownership of one thirtieth of a Class A Unit, the Trust may be deemed to beneficially own approximately 9,583 Class A Units.

On November 13, 2000, the Partnership adopted a Policy for Establishment of Rule 10b5‑1 Trading Plans. Pursuant to this Policy, the Partnership authorized its officers, directors and certain employees, shareholders and affiliates who are deemed “insiders” of the Partnership to adopt individual plans for trading the Partnership’s securities (“Trading Plans”), and established certain procedural requirements relating to the establishment, modification and termination of such Trading Plans. On May 14, 2001, the Partnership approved a Trading Plan of Harold Brown. The trading plan has been amended and restated several times, the most recent being on November 1, 2016. Mr. Brown amended and restated the Trading Plan extending the date through which Depositary Receipts may be purchased through October 31, 2020 for up to 600,000 Depositary Receipts at prices up to $76.00.

The Partnership does not have any securities authorized for issuance pursuant to any equity compensation plans.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Harold Brown and Ronald Brown are brothers.

There are no other family relationships among any of our directors. Messrs. Aertsen, Aloise and Ms. Harps representing a majority of our directors are determined to be independent under the rules of the NYSE Amex Exchange and the SEC. The board holds regularly scheduled meetings.

The Partnership’s written policy with respect to the review and approval of related party transactions is governed by the Partnership Agreement which assigns the Advisory Committee with the responsibility to approve or reject all proposed acquisitions and investments with or from the General Partner or an Affiliate. Related Parties are identified by the Officers of the management company and material transactions are reported to and reviewed by the Audit Committee on a quarterly basis.

The Partnership invested approximately $34,049,000 in nine limited liability companies formed to acquire Investment Properties. The Partnership has a 40%‑ 50% ownership interest in each of these limited liability companies

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accounted for on the equity method of consolidation. The majority stockholder of the General Partner owns between 43.2% and 56% and the President and five employees of the management company own between 0% and 3.3% in each of the Investment Properties. See Note 14 of the consolidated financial statements for a description of the Investment Properties.

See also “Item 2. Properties,” “Item 10. Directors and Executive Officers of the Registrant” and “Item 11. Executive Compensation” for information regarding the fees paid to The Hamilton Company, an affiliate of the General Partner.

ITEM 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES

Miller Wachman LLP served as the Partnership’s independent accountants for the fiscal year ended December 31, 2017 and has reported on the 2017 Consolidated Financial Statements. Aggregate fees rendered to Miller Wachman LLP for the years ended December 31, 2017 and 2016 were as follows:

	2017		2016
Audit Fees
Recurring annual audits and quarterly reviews	$	304,000	$	290,000
Subtotal		304,000		290,000
Other Audit Related Fees (a)		26,200		—
Tax Fees
Recurring tax compliance for the Partnership, 19 subsidiary Partnerships and 18 General Partnerships		94,000		94,000
Subtotal		94,000		94,000
Other Fees		—		—
Total Fees	$	424,200	$	384,000

The Audit Committee’s charter provides that it has the sole authority to review in advance and grant any pre‑approvals of (i) all auditing services to be provided by the independent auditor, (ii) all significant non‑audit services to be provided by the independent auditors as permitted by Section 10A of the Securities Exchange Act of 1934, and (iii) all fees and the terms of engagement with respect to such services. All audit and non‑audit services performed by Miller Wachman during fiscal 2017 and 2016 were pre‑approved pursuant to the procedures outlined above.

(a) Audit of revenues and certain expenses and review of proforma financial information of significant acquisition.

PART IV

ITEM 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)1. Financial Statements:

The following Financial Statements are included in this Form 10‑ K:

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets at December 31, 2017 and 2016

Consolidated Statements of Income for the Years ended December 31, 2017, 2016 and 2015

Consolidated Statements of Changes in Partners’ Capital for the Years ended December 31, 2017, 2016 and 2015

44

Consolidated Statements of Cash Flows for the Years ended December 31, 2017, 2016 and 2015

Notes to Consolidated Financial Statements

2. Consolidated Financial Statement Schedules:

Financial statement schedules are omitted because they are not applicable or not required, or because the required information is included in the financial statements or notes thereto.

(b)Exhibits:

The exhibits filed as part of this Annual Report on Form 10‑K are listed in the Exhibit Index included herewith.

45

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Partners of
New England Realty Associates Limited Partnership

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of New England Realty Associates Limited Partnership (“the Partnership”) as of December 31, 2017 and 2016, and the related consolidated statements of income, changes in partners’ capital and cash flows for each of the years in the three-year period ended December 31, 2017, and the related notes (collectively referred to as the financial statements). We also have audited the Partnership’s internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Partnership as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2017, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control—Integrated Framework (2013) issued by COSO.

Basis for Opinion

The Partnership’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express an opinion on the Partnership’s consolidated financial statements and an opinion on the Partnership’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed 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. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) 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 company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

F-1

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, 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.

/s/ Miller Wachman LLP

We have served as the Company’s auditor since 1993

Boston, Massachusetts

March 12, 2018

F-2

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	December 31,
	2017		2016
ASSETS
Rental Properties	$	207,153,794	$	169,462,811
Cash and Cash Equivalents		7,238,905		7,463,697
Rents Receivable		592,045		567,627
Insurance Recovery Receivable		—		700,931
Real Estate Tax Escrows		488,396		444,625
Prepaid Expenses and Other Assets		4,122,052		3,585,870
Investments in Unconsolidated Joint Ventures		7,212,044		8,336,505
Total Assets	$	226,807,236	$	190,562,066
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	233,221,258	$	212,709,080
Notes Payable		17,000,000		—
Distribution and Loss in Excess of Investment in Unconsolidated Joint Venture		2,806,319		2,577,606
Accounts Payable and Accrued Expenses		3,340,509		4,052,095
Advance Rental Payments and Security Deposits		5,754,327		5,448,011
Total Liabilities		262,122,413		224,786,792
Commitments and Contingent Liabilities (Notes 3 and 9)		—		—
Partners’ Capital 124,386 and 124,409 units outstanding in 2017 and 2016 respectively		(35,315,177)		(34,224,726)
Total Liabilities and Partners’ Capital	$	226,807,236	$	190,562,066

See notes to consolidated financial statements

F-3

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

	Year Ended December 31,
	2017		2016		2015
Revenues
Rental income	$	52,370,221	$	49,121,705	$	45,074,655
Laundry and sundry income		457,167		433,385		406,059
		52,827,388		49,555,090		45,480,714
Expenses
Administrative		2,008,107		2,102,812		2,096,290
Depreciation and amortization		13,462,395		12,181,396		10,562,707
Management fee		2,159,458		2,029,171		1,869,977
Operating		5,227,502		4,822,921		4,939,662
Renting		632,232		636,803		487,225
Repairs and maintenance		8,378,639		8,258,263		6,998,592
Taxes and insurance		6,814,089		6,263,774		5,643,507
		38,682,422		36,295,140		32,597,960
Income Before Other Income (Expense)		14,144,966		13,259,950		12,882,754
Other Income (Expense)
Interest income		1,284		1,025		1,596
Interest expense		(11,114,146)		(10,200,393)		(9,980,359)
Income from investments in unconsolidated joint ventures		3,905,827		1,785,827		868,574
Gain on sale of real estate		—		104,443		—
		(7,207,035)		(8,309,098)		(9,110,189)
Net Income	$	6,937,931	$	4,950,852	$	3,772,565
Net Income per Unit	$	55.77	$	39.62	$	29.86
Weighted Average Number of Units Outstanding		124,392		124,951		126,361

See notes to consolidated financial statements.

F-4

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS’ CAPITAL

	Units						Partner’s Capital
	Limited		General		Treasury		Limited				General
	Class A	Class B	Partnership	Subtotal	Units	Total	Class A		Class B		Partnership		Total
Balance January 1, 2015	144,180	34,243	1,802	180,225	52,572	127,653	$	(21,910,488)	$	(5,184,335)	$	(272,859)	$	(27,367,682)
Distribution to Partners	—	—	—	—				(3,028,706)		(719,318)		(37,859)		(3,785,883)
Stock Buyback	—	—	—	—	2,279	(2,279)		(2,752,393)		(643,682)		(33,878)		(3,429,953)
Net Income	—	—	—	—	—	—		3,018,052		716,787		37,726		3,772,565
Balance December 31 , 2015	144,180	34,243	1,802	180,225	54,851	125,374	$	(24,673,535)	$	(5,830,548)	$	(306,870)	$	(30,810,953)
Distribution to Partners	—	—	—	—	—	—		(5,383,743)		(1,278,639)		(67,297)		(6,729,679)
Stock Buyback	—	—	—	—	965	(965)		(1,311,328)		(307,436)		(16,181)		(1,634,945)
Net Income	—	—	—	—	—	—		3,960,682		940,662		49,508		4,950,852
Balance December 31, 2016	144,180	34,243	1,802	180,225	55,816	124,409	$	(27,407,924)	$	(6,475,961)	$	(340,840)	$	(34,224,726)
Distribution to Partners	—	—	—	—	—	—		(6,388,668)		(1,517,309)		(79,858)		(7,985,835)
Stock Buyback	—	—	—	—	23	(23)		(34,038)		(8,084)		(426)		(42,548)
Net Income	—	—	—	—	—	—		5,550,345		1,318,207		69,379		6,937,931
Balance December 31, 2017	144,180	34,243	1,802	180,225	55,839	124,386	$	(28,280,285)	$	(6,683,147)	$	(351,745)	$	(35,315,177)

See notes to consolidated financial statements.

F-5

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Year Ended December 31,
	2017		2016		2015
Cash Flows from Operating Activities
Net income	$	6,937,931	$	4,950,852	$	3,772,565
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		13,462,395		12,181,396		10,562,707
Amortization of deferred finance costs		192,944		188,256		171,066
(Income) loss  from investments in joint ventures		(3,905,827)		(1,785,827)		(868,574)
Gain on sale of real estate		—		(104,443)		—
Change in operating assets and liabilities
(Increase) Decrease  in rents receivable		(24,418)		(133,883)		40,481
(Decrease) Increase in accounts payable and accrued expense		(400,368)		(588,672)		1,541,650
Decrease  (Increase)  in insurance recovery receivable		329,493		(355,286)		(345,645)
(Increase)   in real estate tax escrow		(43,771)		(73,644)		(30,640)
(Increase) Decrease  in prepaid expenses and other assets		(716,583)		724,308		(1,597,603)
Increase in advance rental payments and security deposits		306,316		339,168		560,114
Total Adjustments		9,200,181		10,391,373		10,033,556
Net cash provided by operating activities		16,138,112		15,342,225		13,806,121
Cash Flows From Investing Activities
Proceeds from unconsolidated joint ventures		7,463,750		3,515,100		2,872,378
Distribution in excess of investment in unconsolidated joint ventures		542,241		515,362		990,262
(Investment)  in unconsolidated joint ventures		(2,746,991)		(2,472,462)		(1,142,640)
Improvement of rental properties		(5,795,148)		(5,163,081)		(6,693,996)
Purchase of Rental Property		(44,989,328)		—		(6,201,930)
Net proceeds from the sale of real estate		—		772,987		—
Net cash (used in) investing activities		(45,525,476)		(2,832,094)		(10,175,926)
Cash Flows from Financing Activities
Payment of financing costs		(304,529)		(174,718)		—
Proceeds of mortgage notes payable		22,250,000		20,071,000		—
Proceeds of notes payable		41,000,000		—		—
Payment of note payable		(24,000,000)		(25,000,000)		—
Principal payments of mortgage notes payable		(1,754,516)		(1,876,278)		(132,071)
Stock buyback		(42,548)		(1,634,945)		(3,429,953)
Distributions to partners		(7,985,835)		(6,729,679)		(3,785,883)
Net cash (used in) financing activities		29,162,572		(15,344,620)		(7,347,907)
Net (Decrease)  in Cash and Cash Equivalents		(224,792)		(2,834,489)		(3,717,712)
Cash and Cash Equivalents, at beginning of period		7,463,697		10,298,186		14,015,898
Cash and Cash Equivalents, at end of period	$	7,238,905	$	7,463,697	$	10,298,186

See notes to consolidated financial statements

F-6

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2017

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

Line of Business:  New England Realty Associates Limited Partnership (“NERA” or the “Partnership”) was organized in Massachusetts in 1977. NERA and its subsidiaries own 26 properties which include 18 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,632 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a 40-50% interest in 9 residential and mixed use properties consisting of 722 apartment units, 12,500 square feet of commercial space and a 50 car parking lot. The properties are located in Eastern Massachusetts and Southern New Hampshire.

Basis of Presentation: The financial statements have been prepared in conformity with GAAP. The preparation  of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. These estimates and assumptions are based on management’s historical experience that are believed to be reasonable at the time. However, because future events and their effects cannot be determined with certainty, the determination of estimates requires the exercise of judgement. The Partnership’s critical accounting policies are those which require assumptions to be made about matters that are highly uncertain. Different estimates could have a material effect on the Partnership’s financial results. Judgements and uncertainties affecting the application of these policies and estimates may result in materially different amounts being reported under different conditions and circumstances.

Principles of Consolidation:  The consolidated financial statements include the accounts of NERA and its subsidiaries. NERA has a 99.67% to 100% ownership interest in each subsidiary except for the nine limited liability companies (the “Investment Properties” or “Joint Ventures”) in which the Partnership has a 40 ‑ 50% ownership interest. The consolidated group is referred to as the “Partnership”. Minority interests are not recorded, since they are insignificant. All significant intercompany accounts and transactions are eliminated in consolidation. The Partnership accounts for its investment in the above‑mentioned Investment Properties using the equity method of consolidation. (See Note 14: Investments in Unconsolidated Joint Ventures).

The Partnership accounts for its investments in joint ventures using the equity method of accounting. These investments are recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions. Generally, the Partnership would discontinue applying the equity method when the investment (and any advances) is reduced to zero and would not provide for additional losses unless the Partnership has guaranteed obligations of the venture or is otherwise committed to providing further financial support for the investee. If the investment subsequently generates income, the Partnership only recognizes its share of such income to the extent it exceeds its share of previously unrecognized losses. In 2013 and beyond, the carrying values of  certain  investments fell below zero. We intend to fund our share of the investments’ future operating deficits should the need arise. However, we have no legal obligation to pay for any of the liabilities of such investments nor do we have any legal obligation to fund operating deficits. (See Note 14: Investment in Unconsolidated Joint Ventures.)

The authoritative guidance on consolidation provides guidance on the identification of entities for which control is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and the determination of which business enterprise, if any, should consolidate the VIE (the “primary beneficiary”). Generally, the consideration of whether an entity is a VIE applies when either (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest, (2) the equity investment at risk is insufficient to finance that equity’s activities without additional subordinated financial support or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The primary beneficiary is defined by the entity having both of the

F-7

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the variable interest entity’s performance; and (2) the obligation to absorb losses and rights to receive the returns from VIE that would be significant to the VIE.

Impairment:  On an annual basis management assesses whether there are any indicators that the value of the Partnership’s rental properties or investments in unconsolidated subsidiaries may be impaired. In addition to identifying   any specific circumstances which may affect a property or properties, management considers other criteria for determining which properties may require assessment for potential impairment. The criteria considered by management include reviewing low leased percentages, significant near term lease expirations, recently acquired properties, current and historical operating and/or cash flow losses, near term mortgage debt maturities or other factors that might impact the Partnership’s intent and ability to hold property. A property’s value is impaired only if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property over the fair value of the property. The Partnership’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved.

Revenue Recognition:  Rental income from residential and commercial properties is recognized over the term of the related lease. For residential tenants, amounts 60 days in arrears are charged against income. The commercial tenants are evaluated on a case by case basis. Certain leases of the commercial properties provide for increasing stepped minimum rents, which are accounted for on a straight‑line basis over the term of the lease. Contingent rent for commercial properties are received from tenants for certain costs as provided in the lease agreement. The costs generally include real estate taxes, utilities, insurance, common area maintenance and recoverable costs. Rental concessions are also accounted for on the straight‑line basis.

Above‑market and below‑market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the differences between (i) the contractual amounts to be paid pursuant to each in‑place lease and (ii) management’s estimate of fair market lease rates for each corresponding in‑place lease, measured over a period equal to the remaining term of the lease for above‑market leases and the initial term plus the term of any below‑market fixed‑rate renewal options for below‑market leases. The capitalized above‑market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining term of the respective leases, and the capitalized below‑market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below‑market fixed‑rate renewal options of the respective leases.

Rental Properties:  Rental properties are stated at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred; improvements and additions which improve or extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost of the asset and related accumulated depreciation is eliminated from the accounts, and any gain or loss on such disposition is included in income. Fully depreciated assets are removed from the accounts. Rental properties are depreciated by both straight‑line and accelerated methods over their estimated useful lives. Upon acquisition of rental property, the Partnership estimates the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities assumed, generally consisting of the fair value of (i) above and below market leases, (ii) in‑place leases and (iii) tenant relationships. The Partnership allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. The Partnership records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities

F-8

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

assumed exceed the purchase consideration of a transaction. In estimating the fair value of the tangible and intangible assets acquired, the Partnership considers information obtained about each property as a result of its due diligence and marketing and leasing activities, and utilizes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.

Other intangible assets acquired include amounts for in‑place lease values and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Partnership’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in‑place lease values include an estimate of carrying costs during hypothetical expected lease‑up periods considering current market conditions, and costs to execute similar leases at market rates during the expected lease‑up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. Characteristics considered by management in valuing tenant relationships include the nature and extent of the Partnership’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of in‑place leases are amortized to expense over the remaining initial terms of the respective leases. The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.

In the event that facts and circumstances indicate that the carrying value of a rental property may be impaired, an analysis of the value is prepared. The estimated future undiscounted cash flows are compared to the asset’s carrying value to determine if a write‑down to fair value is required.

Leasing Fees: Leasing fees are capitalized and amortized on a straight‑line basis over the life of the related lease. Unamortized balances are expensed when the corresponding fee is no longer applicable.

Deferred Financing Costs:  Costs incurred in obtaining financing are capitalized and amortized over the term of the related indebtedness. Deferred financing costs are presented in the balance sheet as a direct deduction from the carrying value of the debt liability to which they relate, except deferred financing costs related to the revolving credit facility, which are presented in prepaid expenses and other assets. In all cases, amortization of such costs is included in interest expense and was approximately $193,000,  $188,000 and $171,000 for the years ended December 31, 2017, 2016 and 2015 respectively.

Income Taxes:  The financial statements have been prepared on the basis that NERA and its subsidiaries are entitled to tax treatment as partnerships. Accordingly, no provision for income taxes have been recorded (See Note 13).

Cash Equivalents:  The Partnership considers cash equivalents to be all highly liquid instruments purchased with a maturity of three months or less.

Segment Reporting:  Operating segments are revenue producing components of the Partnership for which separate financial information is produced internally for management. Under the definition, NERA operated, for all periods presented, as one segment.

Comprehensive Income:  Comprehensive income is defined as changes in partners’ equity, exclusive of transactions with owners (such as capital contributions and dividends). NERA did not have any comprehensive income items in 2017, 2016, or 2015 other than net income as reported.

F-9

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Income (Loss) Per Depositary Receipt:  Effective January 3, 2012, the Partnership authorized a 3‑for‑1 forward split of its Depositary Receipts listed on the NYSE Amex and a concurrent adjustment of the exchange ratio of Depositary Receipts for Class A Units of the Partnership from 10‑to‑1 to 30‑to‑1, such that each Depositary Receipt represents one‑thirtieth (1/₃₀) of a Class A Unit of the Partnership. All references to Depositary Receipts in the report are reflective of the 3‑ for‑1 forward split.

Income Per Unit:  Net income per unit has been calculated based upon the weighted average number of units outstanding during each period presented. The Partnership has no dilutive units and, therefore, basic net income is the same as diluted net income per unit (see Note 7). 

Concentration of Credit Risks and Financial Instruments:  The Partnership’s properties are located in New England, and the Partnership is subject to the general economic risks related thereto. No single tenant accounted for more than 5% of the Partnership’s revenues in 2017, 2016, or 2015. The Partnership makes its temporary cash investments with high‑credit quality financial institutions. At December 31, 2017, substantially all of the Partnership’s cash and cash equivalents were held in interest‑bearing accounts at financial institutions, earning interest at rates from 0.01% to 0.20%. At December 31, 2017 and 2016, respectively approximately $8,898,000 and $8,911,000 of cash and cash equivalents, and security deposits included in prepaid expenses and other assets exceeded federally insured amounts.

Advertising Expense:  Advertising is expensed as incurred. Advertising expense was $201,040,  $191,815 and $165,070 in 2017, 2016 and 2015, respectively.

RentalPropertyHeld  for sale:When assets are identified by management as held for sale, the Partnership discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. The Partnership generally considers assets to be held for sale when the transaction has received appropriate corporate authority, and there are no significant contingencies relating to the sale. If, in management’s opinion, the estimated net sales price, net of selling costs, of the assets which have been identified as held for sale is less than the carrying value of the assets, a valuation allowance is established.

If circumstances arise that previously were considered unlikely and, as a result, the Partnership decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying value before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.

Interest Capitalized:  The Partnership follows the policy of capitalizing interest as a component of the cost of rental property when the time of construction exceeds one year. During the years ended December 31, 2017, 2016 and 2015 there was no capitalized interest.

Extinguishment of Debt:  When existing mortgages are refinanced with the same lender and it is determined that the refinancing is substantially different then they are recorded as an extinguishment of debt. However if it is determined that the refinancing is substantially the same then they are recorded as an exchange of debt. All refinancing qualify as extinguishment of debt.

Reclassifications:  Certain reclassifications have been made to prior period amounts in order to conform to current period presentation. The reclassifications were related primarily to conform to ASU No. 2015-03, Simplifying thePresentation of Debt Issuance Costs, Amortization of deferred financing costs of approximately $171,000 was reclassified as interest expense for the year ended December 31, 2015. There was no change to the net income for any period presented as a result of these reclassifications.

F-10

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

NOTE 2. RENTAL PROPERTIES 

As of December 31, 2017, the Partnership and its Subsidiary Partnerships owned 2,632 residential apartment units in 22 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, 2017, 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, 2017 with a total of 722 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, 2017		December 31, 2016		Useful Life
Land, improvements and parking lots	$	65,087,214	$	52,612,929	15	-	40	years
Buildings and improvements		201,844,565		173,536,288	15	-	40	years
Kitchen cabinets		12,338,627		8,738,323	5	-	10	years
Carpets		8,802,831		7,621,292	5	-	10	years
Air conditioning		641,079		690,535	5	-	10	years
Laundry equipment		263,275		269,784	5	-	7	years
Elevators		1,139,296		1,139,296	20	-	40	years
Swimming pools		444,629		444,629	10	-	30	years
Equipment		11,163,864		10,029,639	5	-	30	years
Motor vehicles		216,260		237,954			5	years
Fences		37,465		37,465	5	-	15	years
Furniture and fixtures		9,390,021		8,127,100	5	-	7	years
Smoke alarms		582,471		174,059	5	-	7	years
Total fixed assets		311,951,597		263,659,293
Less: Accumulated depreciation		(104,797,803)		(94,196,482)
	$	207,153,794	$	169,462,811

F-11

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

							Cost
			Initial Cost to				Capitalized		Gross Amount at Which								Years
Property Name	Encumbrances		Partnerships(1)				Subsequent to		Carried at Close of Period								Built/	Depreciable
Type	(First				Buildings		Acquisition(2)				Buildings				Accumulated		Redecorated	Lives
Location	Mortgages)		Land		Improvements		Improvements		Land		Improvements		Totals		Depreciation		Date Acquired	Years
Boylston Downtown L.P. Residential Apartments Boston, Massachusetts	$	39,049,572	$	2,112,000	$	8,593,109	$	8,836,077	$	2,112,000	$	17,429,186	$	19,541,186	$	11,977,004	July 1995	(3)
Brookside Associates LLC Residential Apartments Woburn, Massachusetts	$	2,501,972	$	684,000	$	3,116,000	$	432,022	$	684,000	$	3,548,022	$	4,232,022	$	2,174,123	Oct. 2000	(3)
Clovelly Apartments L.P. Residential Apartments Nashua, New Hampshire	$	4,160,000	$	177,610	$	1,478,359	$	1,701,168	$	177,610	$	3,179,527	$	3,357,137	$	2,250,924	Sept. 1977	(3)
Commonwealth 1137 L.P. Residential Apartments Boston, Massachusetts	$	3,750,000	$	342,000	$	1,367,669	$	1,196,072	$	342,000	$	2,563,741	$	2,905,741	$	1,765,386	July 1995	(3)
Commonwealth 1144 L.P. Residential Apartments Boston, Massachusetts	$	14,780,000	$	1,410,000	$	5,664,816	$	3,924,962	$	1,410,000	$	9,589,778	$	10,999,778	$	5,954,341	July 1995	(3)
Executive Apartments L.P. Residential Apartments Framingham, Massachusetts	$	2,415,000	$	91,400	$	740,360	$	1,286,060	$	91,400	$	2,026,420	$	2,117,820	$	1,225,043	Sept. 1977	(3)
Hamilton Battle Green LLC Residential Apartments Lexington, Massachusetts	$	4,460,057	$	1,341,737	$	8,457,497	$	159,257	$	1,341,737	$	8,616,754	$	9,958,491	$	2,314,831	Jun. 2011	(3)
Hamilton Cypress LLC Commercial - 1031 Exchange Brookline, Massachusetts	$	—	$	2,362,596	$	4,613,985	$	249,024	$	2,362,596	$	4,863,009	$	7,225,605	$	1,470,530	Oct. 2008	(3)
Hamilton Green Apartments, LLC Residential Apartments Andover, Massachusetts	$	36,555,470	$	16,054,336	$	44,794,438	$	581,025	$	16,054,336	$	45,375,463	$	61,429,799	$	15,460,634	Jul. 2013	(3)
Hamilton Linewt LLC Commercial - 1031 Exchange Newton, Massachusetts	$	—	$	884,042	$	2,652,127	$	138,904	$	884,042	$	2,791,031	$	3,675,073	$	706,988	Nov. 2007	(3)
Hamilton Oaks Associates LLC Residential Apartments Brockton, Massachusetts	$	11,925,000	$	2,175,000	$	12,325,000	$	3,281,817	$	2,175,000	$	15,606,817	$	17,781,817	$	9,876,116	Dec. 1999	(3)
Highland Street Apartments, L.P. Residential Apartments Lowell, Massachusetts	$	1,050,000	$	156,000	$	634,085	$	274,024	$	156,000	$	908,109	$	1,064,109	$	647,937	Dec. 1996	(3)
Linhart L.P.  Residential / Commercial Newton, Massachusetts	$	—	$	385,000	$	1,540,000	$	1,585,649	$	385,000	$	3,125,649	$	3,510,649	$	2,245,989	Jan. 1995	(3)
NERA Dean St. Associates LLC Residential Apartments Norwood, Massachusetts	$	5,687,000	$	1,512,000	$	5,701,480	$	1,086,013	$	1,512,000	$	6,787,493	$	8,299,493	$	3,702,802	Jun. 2002	(3)
North Beacon 140 L.P. Residential Apartments Boston, Massachusetts	$	6,937,000	$	936,000	$	3,762,013	$	2,350,856	$	936,000	$	6,112,869	$	7,048,869	$	4,279,547	July 1995	(3)
Olde English Apartments L.P. Residential Apartments Lowell, Massachusetts	$	3,080,000	$	46,181	$	878,323	$	1,026,852	$	46,181	$	1,905,175	$	1,951,356	$	1,289,709	Sept. 1977	(3)
Redwood Hills L.P. Residential Apartments Worcester, Massachusetts	$	6,743,000	$	1,200,000	$	4,810,604	$	3,946,412	$	1,200,000	$	8,757,016	$	9,957,016	$	5,547,278	July 1995	(3)
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts	$	20,071,000	$	6,247,153	$	24,954,777	$	825,028	$	6,247,153	$	25,779,805	$	32,026,958	$	3,149,707	Sept. 2015	(3)
River Drive L.P. Residential Apartments Danvers, Massachusetts	$	3,465,000	$	72,525	$	587,777	$	1,033,453	$	72,525	$	1,621,230	$	1,693,755	$	840,124	Sept. 1977	(3)
Riverside Apartments Condominium Units Massachusetts	$	—	$	23,346	$	190,807	$	77,051	$	23,346	$	267,858	$	291,204	$	223,822	Sept. 1977	(3)
School St Assoc LLC Residential Apartments Framingham, Massachusetts	$	14,549,604	$	4,686,728	$	18,746,911	$	(346,294)	$	4,686,728	$	18,400,617	$	23,087,345	$	9,487,028	Apr. 2003	(3)
WRF Associates LLC Strip Mall Framingham, Massachusetts	$	6,000,000	$	3,280,000	$	4,920,000	$	82,460	$	3,280,000	$	5,002,460	$	8,282,460	$	3,070,591	May 1999	(3)
WCB Associates LLC Residential Apartments Brockton, Massachusetts	$	7,000,000	$	1,335,000	$	7,565,501	$	2,342,341	$	1,335,000	$	9,907,842	$	11,242,842	$	6,109,227	Dec. 1999	(3)
Westate Apartments Burlington LLC Residential Apartments Burlington, Massachusetts	$	2,500,000	$	44,965	$	4,478,687	$	225,772	$	44,965	$	4,704,459	$	4,749,424	$	2,325,390	Sept. 2004	(3)
Westgate Apartments LLC Residential Apartments Woburn, Massachusetts	$	15,700,000	$	461,300	$	2,424,636	$	7,149,052	$	417,107	$	9,573,688	$	9,990,795	$	5,681,385	Sept. 1977	(3)
Woodland Park Apartments LLC
Newton, Massachusetts	$	22,250,000	$	9,114,334	$	35,874,994	$	541,522	$	9,114,334	$	36,416,516	$	45,530,850	$	1,021,349	July 2017	(3)
	$	234,629,675	$	57,135,253	$	210,873,955	$	43,986,579	$	57,091,060	$	254,860,534	$	311,951,597	$	104,797,803

F-12

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

(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.

(3) In 2017, rental properties were depreciated over the following estimated useful lives:

Assets	Life
Buildings and Improvements	10	-	40	years
Other Categories of Assets	5	-	15	years

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

	December 31,
	2017		2016		2015
Rental Properties
Balance, Beginning	$	263,659,293	$	261,276,898	$	225,021,946
Additions:
Buildings, improvements and other assets		50,784,476		5,163,081		37,895,926
		314,443,769		266,439,979		262,917,872
Deduct:
Write-offs of retired or disposed assets		2,492,172		2,112,142		1,640,974
Rental properties held for sale and/or sold				668,544		—
Balance, Ending	$	311,951,597	$	263,659,293	$	261,276,898
Accumulated Depreciation
Balance, Beginning	$	94,196,482	$	84,579,584	$	75,905,862
Add:
Depreciation for the year		13,093,493		11,729,039		10,314,696
		107,289,975		96,308,623		86,220,558
Deduct
Accumulated depreciation of retired or disposed assets		2,492,172		2,112,141		1,640,974
Balance, Ending	$	104,797,803	$	94,196,482	$	84,579,584

On July 6, 2017, Woodland Park Partners, LLC, a newly formed subsidiary of the Partnership, purchased the Woodland Park Apartments, a 126-unit apartment complex located at 264-290 Grove Street, Newton, Massachusetts (the “Property”), for a purchase price of $45,600,000. The closing costs were approximately $64,000.

To fund the purchase price, the Partnership borrowed $25,000,000 under its outstanding line of credit with KeyBank, NA, and $16,000,000 from HBC Holdings, LLC, a Massachusetts limited liability company controlled by Harold Brown and the Partnership’s cash reserves. On September 29, 2017, the Partnership obtained a mortgage on Woodland Park. The new mortgage is $22,250,000, interest is fixed at 3.79% for 10 years,interest only for the first  5 years, and the mortgage to be amortized over 30 years. The closing costs associated with the financing were approximately $176,000.   From the purchase price, the Partnership allocated approximately $541,000 for in-place leases, and approximately $42,000 to the value of tenant relationships. These amounts are being amortized over 12 and 24 months respectively.

On August 3, 2016, Hamilton Green Apartments, LLC sold a single family house contiguous with its apartment complex in Andover, Massachusetts.  The sale price of the property was $1,000,000 with closing costs of $227,663 and a cost basis of $668,544 resulting in a gain on the sale of $103,793.  Included in the closing costs is a mortgage prepayment penalty of $187,905. The proceeds from the sale were used to reduce the principal amount on the apartment complex’s mortgage.

F-13

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

NOTE 3. RELATED PARTY TRANSACTIONS

The Partnership’s properties are managed by an entity that is owned by the majority shareholder of the General Partner. The management fee is equal to 4% of gross receipts of rental revenue and laundry income on the majority of the Partnership’s properties and 3% on Linewt. Total fees paid were approximately $2,159,000,  $2,029,000 and $1,870,000 in 2017, 2016 and 2015, respectively.

The Partnership Agreement permits the General Partner or Management Company to charge the costs of professional services (such as counsel, accountants and contractors) to NERA. In 2017, 2016 and 2015, approximately $882,000,  $1,069,000 and $994,000, was charged to NERA for legal, accounting, construction, maintenance, rental and architectural services  supervision of capital improvements and brokerage commissions. Of the 2017 expenses referred to above, approximately $295,000 consisted of repairs and maintenance,  $359,000 of administrative expense, and $1,000 of brokerage commissions. Approximately $227,000 of expenses for construction, architectural services and supervision of capital projects were capitalized in rental properties. Additionally in 2017, the Hamilton Company received approximately $1,377,000 from the Investment Properties of which approximately $673,000 was the management fee, approximately $620,000 was for construction, architectural services and supervision of capital projects, approximately $44,000 was for maintenance services, and approximately $40,000 was for administrative services. The management fee is equal to 4% of gross receipts rental income on the majority of investment properties and 2% on Dexter Park.

The Partnership reimburses the management company for the payroll and related expenses of the employees who work at the properties. Total reimbursement was approximately $3,463,000,  $3,076,000 and $2,958,000 for the years ended December 31, 2017, 2016 and 2015, respectively. The Management Company maintains a 401K plan for all eligible employees whereby the employees may contribute the maximum allowed by law. The plan also provides for discretionary contributions by the employer. There were no employer contributions during 2017, 2016 or 2015.

Bookkeeping and accounting functions are provided by the Management Company’s accounting staff, which consists of approximately 14 people. During the years ended December 31, 2017, 2016 and 2015 the Management Company charged the Partnership $125,000 per year for bookkeeping and accounting services included in administrative expenses above.

The President of the Management Company performs asset management consulting services and receives an asset management fee from the Partnership. The Partnership does not have a written agreement with this individual. During the years ended December 31, 2017, 2016 and 2015 this individual received a quarterly fee of $18,750 for a total annual fee of $75,000.

To fund the purchase of Woodland Park as mentioned in Note 2, the Partnership borrowed $16,000,000  from HBC Holding LLC, on July 16, 2017, with interest only  at 4.75%. The loan was fully paid off through the financing of Woodland Park  as of Dcember 31,2017. The total interest expense  incurred was approximately $182,000.

The Partnership has invested in nine limited partnerships, which have invested in mixed use residential apartment complexes. The Partnership has a 40% to 50% ownership interest in each investment property. The other investors are Harold Brown, the President of the Management Company and five other employees of the Management Company. Harold Brown’s ownership interest is between 43.2% and 56 %. See Note 14 for a description of the properties and their operations.

F-14

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

The Advisory Committee held 4 meetings during 2017, and a total of $19,000 was paid for attendance and participation in such meetings. Additionally, the Audit Committee held 4 meetings in 2017 and a total of $12,000 was paid for attendance and participation in such meetings.

See Note 8 for information regarding the repurchase of Class B and General Partnership Units.

NOTE 4. OTHER ASSETS

Approximately $2,420,000 and $2,381,000 of security deposits are included in prepaid expenses and other assets at December 31, 2017 and 2016, respectively. The security deposits and escrow accounts are restricted cash.

Included in prepaid expenses and other assets at December 31, 2017 and 2016 is approximately $357,000 and $423,000, respectively, held in escrow to fund future capital improvements.

Intangible assets on the acquisitions of Woodland Park and the Residence at Captain Parkers are included in prepaid expenses and other assets. Intangible assets are approximately $302,000 net of accumulated amortization of approximately $280,000 and approximately $12,000 net of accumulated amortization of approximately $2,245,000 at December 31, 2017 and 2016, respectively.

NOTE 5. MORTGAGE NOTES PAYABLE

Mortgages Payable

At December 31, 2017 and 2016, the mortgages payable consisted of various loans, all of which were secured by first mortgages on properties referred to in Note 2. At December 31, 2017, the interest rates on these loans ranged from 3.24% to 5.97%, payable in monthly installments aggregating approximately $1,060,000, including principal, to various dates through 2029. The majority of the mortgages are subject to prepayment penalties. At December 31, 2017, the weighted average interest rate on the above mortgages was 4.59%. The effective rate of 4.67% 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.

 Financing fees of approximately $1,531,000 and $1,425,000 are net of accumulated amortization of approximately $1,149,000 and $1,061,000 at December 31, 2017 and 2016, respectively, which includes deferred financing costs for the line of credit of approximately $121,000 and $28,000 at December 31, 2017 and 2016, respectively.

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

F-15

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Approximate annual maturities at December 31, 2017 are as follows:

2018—current maturities	$	7,843,000
2019		1,923,000
2020		4,331,000
2021		2,449,000
2022		2,686,000
Thereafter		215,397,000
		234,629,000
Less: unamortized deferred financing costs		1,408,000
	$	233,221,000

On September 29, 2017, Woodland Park Partners LLC, ( “Woodland Park”), entered into a Multifamily Loan and Security Agreement (the “Loan Agreement”) with KeyBank National Association (the “Lender”). The manager of Woodland Park is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Woodland Park. The Loan Agreement provides for a term loan (the “Loan”) in the principal amount of $22,250,000.  The Loan is due on October 1, 2027 (the “Due Date”), unless the due date is accelerated in accordance with the Loan’s terms, with interest only through October 1, 2022. Borrowings under the Loan will bear interest at the rate of 3.79%.

On January 7, 2016, Captain Parker entered into a Multifamily Loan and Security Agreement (the “Loan Agreement”) with KeyBank National Association (the “Lender”). The manager of Captain Parker is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Captain Parker. The Loan Agreement provides for a term loan (the “Loan”) in the principal amount of $20,071,000.  The Loan is due on February 1, 2026 (the “Due Date”), unless the due date is accelerated in accordance with the Loan’s terms. Borrowings under the Loan will bear interest at rates equal to (i) the one month LIBOR rate for United States Dollar Deposits, determined monthly, plus 201 basis points. The interest rate increases upon an event of default.

Captain Parker is required to repay the aggregate principal amount of the Loan by the Due Date. Interest payments on the Loans are payable monthly in arrears on specified dates set forth in the Loan Agreement. Principal payments on the Loan are also payable monthly commencing on March 1, 2021.  The note issued by Captain Parker in connection with the Loan Agreement (the “Note”) also contains provisions for optional prepayment with a penalty under certain circumstances.

Line of Credit

On July 31, 2014, the Partnership entered into an agreement for a $25,000,000 revolving line of credit.  The term of the line was for three years with a floating interest rate equal to a base rate of the greater of (a) the Prime Rate (b) the Federal Funds Rate plus one-half of one percent per annum, or (c) the LIBOR Rate for a period of one month plus 1% per annum, plus the  applicable margin of 2.5%.  

The agreement originally expired on July 31, 2017, and was extended until October 31, 2020. The costs associated with the line of credit extension were approximately $128,000. The Partnership borrowed $25,000,000 to partially fund the purchase of Woodland Park. It paid down $8,000,000 through the financing of the property and its’ cash reserve. As of December 31, 2017, the credit line had an outstanding balance of $17,000,000.

F-16

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

On January 7, 2016, Captain Parker entered into a Multifamily Loan and Security Agreement (the “Loan Agreement”) with KeyBank National Association (the “Lender”). As a result of securing the financing, the Partnership used the proceeds of the loan and cash reserves of the Partnership to pay down the Line of Credit to zero. A payment was made on January 7, 2016 for $23,000,000, and another payment for $2,000,000 was made on January 15, 2016.

The line of credit may be used for acquisition, refinancing, improvements, working capital and other needs of the Partnership. The line may not be used to pay dividends, make distributions or acquire equity interests of the Partnership.

The line of credit is collateralized by varying percentages of the Partnership’s ownership interest in 23 of its subsidiary properties and joint ventures. Pledged interests range from 49% to 100% of the Partnership’s ownership interest in the respective entities.

The Partnership paid fees to secure the line of credit. Any unused balance of the line of credit is subject to a fee ranging from 15 to 20 basis points per annum. The Partnership paid approximately $29,000 during the year ended December 31, 2017.

The line of credit agreement has several covenants, such as providing cash flow projections and compliance certificates, as well as other financial information. The covenants include, but are not limited to the following: maintain a leverage ratio that does not exceed 65%; aggregate increase in indebtedness of the subsidiaries and joint ventures should not exceed $15,000,000; maintain a tangible net worth (as defined in the agreement) of a minimum of $150,000,000; a minimum ratio of net operating income to total indebtedness of at least 9.5%; debt service coverage ratio of at least 1.6 to 1, as well as other items. The Partnership is in compliance with these covenants as of December 31, 2017.

NOTE 6. ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

The Partnership’s residential lease agreements may require tenants to maintain a one-month advance rental payment and/or a security deposit. At December 31, 2017 and 2016 respectively, amounts received for prepaid rents of approximately $2,127,000 and $1,954,000 are included in cash and cash equivalents, and security deposits of approximately $2,420,000 and $2,381,000 are included in prepaid expenses and other assets and are restricted cash.

NOTE 7. PARTNERS’ CAPITAL

The Partnership has two classes of Limited Partners (Class A and B) and one category of General Partner. Under the terms of the Partnership Agreement, distributions to holders of Class B Units and General Partnership Units must represent 19% and 1%, respectively, of the total units outstanding. All classes have equal profit sharing and distribution rights, in proportion to their ownership interests.

Effective January 3, 2012, the Partnership authorized a 3‑for‑1 forward split of its Depositary Receipts listed on the NYSE Amex and a concurrent adjustment of the exchange ratio of Depositary Receipts for Class A Units of the Partnership from 10‑to‑1 to 30‑to‑1, such that each Depositary Receipt represents one‑thirtieth (1/₃₀) of a Class A Unit of the Partnership.

In January 2018, the Partnership approved a quarterly distribution to its Class A Limited Partners and holders of Depositary Receipts of record as of March 15, 2018 and payable on March 31, 2018, of $9.00 per unit ($0.30 per receipt).

F-17

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

In 2017, regular quarterly distributions of $9.00 per unit ($0.30 per receipt) were paid in March, June, September and December. In December 2017, the Partnership paid a special distribution of $28.50 per unit ($0.95 per receipt).

In 2016, regular quarterly distributions of $7.50 per unit ($0.25 per receipt) were paid in March, June, September and December. In December 2016, the Partnership paid a special distribution of $24.00 per unit ($0.80 per receipt).

The Partnership has entered into a deposit agreement with an agent to facilitate public trading of limited partners’ interests in Class A Units. Under the terms of this agreement, the holders of Class A Units have the right to exchange each Class A Unit for 30 Depositary Receipts. The following is information per Depositary Receipt:

	Year Ended
	December 31,
	2017		2016
Net Income per Depositary Receipt	$	1.86	$	1.32
Distributions per Depositary Receipt	$	2.15	$	1.80

NOTE 8. TREASURY UNITS

Treasury Units at December 31, 2017 are as follows:

Class A	44,671
Class B	10,609
General Partnership	559
	55,839

On August 20, 2007, NewReal, Inc., the General Partner authorized an equity repurchase program (“Repurchase Program”) under which the Partnership was permitted to purchase, over a period of twelve months, up to 300,000 Depositary Receipts (each of which is one‑tenth of a Class A Unit). Over time, the General Partner has authorized increases in the equity repurchase program. On March 10, 2015, the General Partner authorized an increase in the Repurchase Program to 2,000,000 Depository Receipts and extended the Program for an additional five years from March 31, 2015 until March 31, 2020. The Repurchase Program requires the Partnership to repurchase a proportionate number of Class B Units and General Partner Units in connection with any repurchases of any Depositary Receipts by the Partnership based upon the 80%,  19% and 1% fixed distribution percentages of the holders of the Class A, Class B and General Partner Units under the Partnership’s Second Amended and Restate Contract of Limited Partnership. Repurchases of Depositary Receipts or Partnership Units pursuant to the Repurchase Program may be made by the Partnership from time to time in its sole discretion in open market transactions or in privately negotiated transactions. From August 20, 2007 through December 31, 2017, the Partnership has repurchased 1,365,306 Depositary Receipts at an average price of $27.14 per receipt (or $814.20 per underlying Class A Unit), 3,072 Class B Units and 162 General Partnership Units, both at an average price of $ 926.26 per Unit, totaling approximately $40,274,000 including brokerage fees paid by the Partnership.

During the year ended December 31, 2017, the Partnership purchased a total of 549 Depositary Receipts. The average price was $62.00 per receipt or $1,860.00 per unit. The total cost including commission was $34,038. The Partnership was required to repurchase 4.3 Class B Units and 0.2 General Partnership units at a cost of $8,084 and $426 respectively.

F-18

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

During the year ended December 31, 2016, the Partnership purchased a total of 23,159 Depositary Receipts.  The average price was $55.89 per receipt or $1,676.70 per unit. The total cost including commissions was $1,311,328. The Partnership was required to repurchase 183 Class B Units and 10 General Partnership Units for a cost of $307,436 and $16,181, respectively.

NOTE 9. COMMITMENTS AND CONTINGENCIES

From time to time, the Partnership is involved in various ordinary routine litigation incidental to their business. The Partnership either has insurance coverage or provides for any uninsured claims when appropriate. The Partnership is not involved in any material pending legal proceedings.

On November 19, 2016, a pipe broke at 62 Boylston Street in Boston, MA. resulting in water damage to 24  apartments. The Partnership has insurance coverage on both the repairs and rental loss. As of December 31, 2017, the claim has been settled and the Partnership has received payments of approximately $329,000.

NOTE 10. RENTAL INCOME

During the year ended December 31, 2017, approximately 93% of rental income was related to residential apartments and condominium units with leases of one year or less. The majority of these leases expire in June, July and August. Approximately 7% was related to commercial properties, which have minimum future annual rental income on non‑cancellable operating leases at December 31, 2017 as follows:

	Commercial
	Property Leases
2018	$	2,623,000
2019		2,131,000
2020		1,767,000
2021		1,325,000
2022		565,000
Thereafter		1,159,000
	$	9,570,000

The aggregate minimum future rental income does not include contingent rentals that may be received under various leases in connection with common area charges and real estate taxes. Aggregate contingent rentals from continuing operations were approximately $642,000,  $616,000 and $683,000 for the years ended December 31, 2017, 2016 and 2015 respectively. Staples and Trader Joes, tenants at Staples Plaza are approximately 29% of the total commercial rental income.

F-19

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

The following information is provided for commercial leases:

	Annual base				Percentage of
	rent for		Total square feet	Total number of	annual base rent for
Through December 31,	expiring leases		for expiring leases	leases expiring	expiring leases
2018	$	499,878	19,724	14	17	%
2019		576,710	20,838	11	19	%
2020		185,494	4,461	6	6	%
2021		829,156	40,323	6	29	%
2022		486,772	12,218	6	16	%
2023		157,443	4,771	1	5	%
2024		94,184	1,858	1	3	%
2025		—	—	—	0	%
2026		—	—	—	0	%
2027		—	—	—	0	%
2028		—	—	—	0	%
2029		142,450	3,850	1	5	%
Totals	$	2,972,087	108,043	46	100	%

Rents receivable are net of an allowance for doubtful accounts of approximately $644,000 and $523,000 at December 31, 2017 and 2016. Included in rents receivable at December 31, 2017 is approximately $116,000 resulting from recognizing rental income from non‑cancelable commercial leases with future rental increases on a straight‑line basis. The majority of this amount is for long‑term leases at 62 Boylston Street in Boston, Massachusetts.

Rents receivable at December 31, 2017 also includes approximately $118,000 representing the deferral of rental concession primarily related to the residential properties.

NOTE 11. CASH FLOW INFORMATION

During the years ended December 31, 2017, 2016 and 2015, cash paid for interest was approximately $10,589,000,  $9,942,000 and $9,838,000 respectively. Cash paid for state income taxes was approximately $61,000,  $47,000 and $32,000 during the years ended December 31, 2017, 2016 and 2015 respectively. In 2015, the Partnership was involved in a non-cash financing activity of $25,000,000 in connection with the purchase of the residence at Captain Parker.

NOTE 12. FAIR VALUE MEASUREMENTS

Fair Value Measurements on a Recurring Basis

At December 31, 2017 and 2016, we do not have any significant financial assets or financial liabilities that are measured at fair value on a recurring basis in our consolidated financial statements. 

Financial Assets and Liabilities not Measured at Fair Value

At December 31, 2017 and 2016 the carrying amounts of certain of our financial instruments, including cash and cash equivalents, accounts receivable, and notes payable, accounts payable and accrued expenses were representative of their fair values due to the short‑term nature of these instruments or, the recent acquisition of these items.

F-20

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

At December 31, 2017 and 2016, we estimated the fair value of our mortgages payable and other notes based upon quoted market prices for the same (Level 1) or similar (Level 2) issues when current quoted market prices are available. We estimated the fair value of our secured mortgage debt that does not have current quoted market prices available by discounting the future cash flows using rates currently available to us for debt with similar terms and maturities (Level 3). The differences in the fair value of our debt from the carrying value are the result of differences in interest rates and/or borrowing spreads that were available to us at December 31, 2017 and 2016, as compared with those in effect when the debt was issued or acquired. The secured mortgage debt contain pre‑payment penalties or yield maintenance provisions that could make the cost of refinancing the debt at lower rates exceed the benefit that would be derived from doing so.

At December 31, 2017, the Partnership’s line of credit had an outstanding balance in the amount of $17,000,000, which represents its fair market value.

The following methods and assumptions were used by the Partnership in estimating the fair value of its financial instruments:

· For cash and cash equivalents, accounts receivable, other assets, investment in partnerships, accounts payable, advance rents and security deposits: fair value approximates the carrying value of such assets and liabilities.

· For mortgages and notes payable: fair value is generally based on estimated future cash flows, which are discounted using the quoted market rate from an independent source for similar obligations. Refer to the table below for the carrying amount and estimated fair value of such instruments.

The following table reflects the carrying amounts and estimated fair value of our debt.

		Carrying Amount		Estimated Fair Value
Mortgage Notes Payable
Partnership Properties
At December 31, 2017	*	$	233,221,258	$	237,895,708
At December 31, 2016	*	$	212,709,080	$	219,086,450
Investment Properties
At December 31, 2017	*	$	124,145,012	$	125,519,974
At December 31, 2016	*	$	130,152,297	$	133,991,269

*Net of unamortized deferred financing costs

Disclosure about fair value of financial instruments is based on pertinent information available to management as of December 31, 2017 and 2016. Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2017 and current estimates of fair value may differ significantly from the amounts presented herein.

NOTE 13. TAXABLE INCOME AND TAX BASIS

Taxable income reportable by the Partnership and includable in its partners’ tax returns is different than financial statement income because of tax free exchanges, accelerated depreciation, different tax lives, and timing differences related to prepaid rents, allowances and intangible assets at significant acquisitions. Taxable income of approximately $5,438,000 was approximately $1,500,000 less than statement income for the year ended December 31,

F-21

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

2017. The primary reason for the decrease is due to accelerated depreciation, tax free exchange and other differences in the treatment of certain expenditures. The cumulative tax basis of the Partnership’s real estate at December 31, 2017 is approximately $1,532,000 less than the statement basis. The primary reasons for the lower tax basis are tax free exchanges, and accelerated depreciation. The Partnership’s tax basis in its joint venture investments is approximately $5,000,000 more than statement basis.

Certain entities included in the Partnership’s consolidated financial statements are subject to certain state taxes. These taxes are not significant and are recorded as operating expenses in the accompanying consolidates financial statements.

The following reconciles GAAP net income to taxable income:

	For the year ended
	December 31,
	2017		2016		2015
	(in thousands)
Financial statement (“book”) net income	$	6,938	$	4,951	$	3,773
Book/Tax differences from depreciation and amortization		(3,097)		(1,411)		(2,513)
Book/Tax differences on tax free exchanges		1,344		1,257		501
Book/Tax differences from Investment Properties		—		(279)		(74)
Increase (Decrease) in prepaid rent and allowances		253		375		413
Other		—		—		6
Taxable income (loss)	$	5,438	$	4,893	$	2,106

Allowable accelerated depreciation deductions were extended through 2017. Future tax law changes may significantly affect taxable income.

The Partnership adopted the amended provisions related to uncertain tax provisions of ASC 740, Income Taxes. As a result of the implementation of the guidance, the Partnership recognized no material adjustments regarding its tax accounting treatment. The Partnership expects to recognize interest and penalties related to uncertain tax positions, if any, as income tax expense, which would be included in general and administrative expense.

In the normal course of business the Partnership or one of its subsidiaries is subject to examination by federal, state and local jurisdictions in which it operates, where applicable. As of December 31, 2017, the tax years that generally remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2014 forward.

F-22

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

NOTE 14. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

The Partnership has invested in nine limited partnerships and limited liability companies, the majority of which have invested in residential apartment complexes, with three Joint Ventures investing in commercial property. The Partnership has between a 40%‑50% ownership interests in each investment. The other investors are Harold Brown, the President of the Management Company and five other employees of the Management Company. Harold Brown’s ownership interest is between 43.2% and 56%, with the balance owned by the others. A description of each investment is as follows:

On October 28, 2009 the Partnership invested approximately $15,925,000 in a joint venture to acquire a 40% interest in a residential property located in Brookline, Massachusetts. The property, Hamilton Park Towers LLC, referred to as Dexter Park, is a 409 unit residential complex. The purchase price was $129,500,000. The original mortgage was $89,914,000 with an interest rate of 5.57% and it matures in 2019. The mortgage calls for interest only payments for the first two years of the loan and amortized over 30 years thereafter. The balance of this mortgage before unamortized deferred financing costs is approximately $82,004,000 at December 31, 2017.  This investment, Hamilton Park Towers, LLC is referred to as Dexter Park.

On October 3, 2005, the Partnership invested $2,500,000 for a 50% ownership interest in a 168‑unit apartment complex in Quincy, Massachusetts. The purchase price was $30,875,000. The Joint Venture sold 120 units as condominiums and retained 48 units for long‑term investment. In February 2007, the Joint Venture refinanced the 48 units with a new 10 year mortgage in the original amount of $4,750,000 with an interest rate of 5.57%, interest only for five years. The loan was to be amortized over 30 years with a maturity date of March 2017. On March 1, 2017, the mortgage balance was paid in full, with the Partnership contributing its share of the mortgage balance of approximately $2,222,000. As of December 31, 2017, 29 units had been sold with a gain on the sales of approximately $3,628,000. As of December 31, 2017, 6 additional units were under purchase and sale agreements, and the Partnership owned 19 units. Two units were sold in January 2018. This investment is referred to as Hamilton Bay Apartments, LLC.

During 2017, Hamilton Bay LLC, a Joint Ventire, sold one unit for a gain of approximately $133,000. As of December 31,2017, all units have been sold by this Joint Venture. 

On March 7, 2005, the Partnership invested $2,000,000 for a 50% ownership interest in a building comprising 48 apartments, one commercial space and a 50‑car surface parking lot located in Boston, Massachusetts. The purchase price was $14,300,000, with a $10,750,000 mortgage. The Joint Venture planned to operate the building and initiate development of the parking lot. In June 2007, the Joint Venture separated the parcels, formed an additional limited liability company for the residential apartments and obtained a mortgage on the property. The new limited liability company formed for the residential apartments and commercial space is referred to as Hamilton Essex 81, LLC. In August 2008, the Joint Venture restructured the mortgages on both parcels at Essex 81. On September 28, 2015, Hamilton Essex Development, LLC paid off the outstanding mortgage balance of $1,952,286.  The Partnership made a capital contribution of $978,193 to Hamilton Essex Development LLC for its share of the funds required for the transaction.  Additionally, the Partnership made a capital contribution of $100,000 to Hamilton Essex 81, LLC.  On September 30, 2015, Hamilton Essex 81, LLC obtained a new 10 year mortgage in the amount of $10,000,000, interest only at 2.18% plus the one month Libor rate.  The proceeds of the note were used to pay off the existing mortgage of $8,040,719 and the Partnership received a distribution of $978,193 for its share of the excess proceeds. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. The investment in the parking lot is referred to as Hamilton Essex Development, LLC; the investment in the apartments is referred to as Hamilton Essex 81, LLC. At

F-23

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

December 31, 2017, the balance on this mortgage before unamortized deferred financing costs is approximately $10,000,000.

On March 2, 2005, the Partnership invested $2,352,000 for a 50% ownership interest in a 176‑unit apartment complex with an additional small commercial building located in Quincy, Massachusetts. The purchase price was $23,750,000. The Partnership sold 127 of the units as condominiums and retained 49 units for long‑term investment. The Partnership obtained a new 10‑year mortgage in the amount of $5,000,000 on the units to be retained by the Partnership. The interest on the new loan was 5.67% fixed for the 10 year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan term. On July 8, 2016, Hamilton 1025 LLC paid off the outstanding balance of the mortgage balance. The Partnership made a capital contribution of $2,359,500 to Hamilton 1025, LLC for its share of the funds required for the transaction. 20 units were sold in the year ended December 31, 2017 with a gain on the sales of approximately $2,380,000. As of December 31, 2017, 8 units were under purchase and sales agreements and the Partnership owned 18 units. One unit was sold in January, 2018. This investment is referred to as Hamilton 1025, LLC.

In September 2004, the Partnership invested approximately $5,075,000 for a 50% ownership interest in a 42‑unit apartment complex located in Lexington, Massachusetts. The purchase price was $10,100,000. In October 2004, the Joint Venture obtained a mortgage on the property in the amount of $8,025,000 and returned $3,775,000 to the Partnership. The Joint Venture obtained a new 10‑ year mortgage in the amount of $5,500,000 in January 2007. The interest on the new loan was  5.67% fixed for the ten year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan. This loan required a cash contribution by the Partnership of $1,250,000 in December 2006. On September 12, 2016, the property was refinanced with a 15 year mortgage in the amount of $6,000,000, at 3.71%, interest only. The Joint Venture Partnership paid off the prior mortgage of approximately $5,158,000 with the proceeds of the new mortgage and made a distribution of $385,000 to the Partnership. The cost associated with the refinancing was approximately $123,000.  At December 31, 2017, the balance on this mortgage before unamortized deferred financing costs is approximately $6,000,000. This investment is referred to as Hamilton Minuteman, LLC.

In August 2004, the Partnership invested $8,000,000 for a 50% ownership interest in a 280‑unit apartment complex located in Watertown, Massachusetts. The total purchase price was $56,000,000. The Joint Venture sold 137 units as condominiums. The assets were combined with Hamilton on Main Apartments. Hamilton on Main, LLC is known as Hamilton Place. In 2005, Hamilton on Main Apartments, LLC obtained a ten year mortgage on the three buildings to be retained. The mortgage was $16,825,000, with interest only of 5.18% for three years and amortizing on a 30 year schedule for the remaining seven years when the balance is due. The net proceeds after funding escrow accounts and closing costs on the mortgage were approximately $16,700,000, which were used to reduce the existing mortgage. In August 2014, the property was refinanced with a 10 year mortgage in the amount of $16,900,000 at 4.34% interest only.  The Joint Venture paid off the prior mortgage of approximately $15,205,000 with the proceeds of the new mortgage and distributed $850,000 to the Partnership. The costs associated with the refinancing were approximately $161,000. At December 31, 2017, the balance of the mortgage before unamortized deferred financing costs is approximately $16,900,000.The investment is referred to as Hamilton On Main LLC.

F-24

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

In November 2001, the Partnership invested approximately $1,533,000 for a 50% ownership interest in a 40-unit apartment building in Cambridge, Massachusetts. In June 2013, the property was refinanced with a 15 year mortgage in the amount of $10,000,000 at 3.87%, interest only for 3 years and is amortized on a 30‑year schedule for the balance of the term. The Joint Venture paid off the prior mortgage of approximately $6,776,000 with the proceeds of the new mortgage. After the refinancing, the Joint Venture  made a distribution of $1,610,000 to the Partnership. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. At December 31, 2017, the balance of this mortgage before unamortized deferred financing costs is approximately $9,743,000. This investment is referred to as 345 Franklin, LLC.

F-25

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Summary financial information as of December 31, 2017

				Hamilton															Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,615,554		$	2,598,297		$	6,325,676		$	—		$	—		$	—		$	5,870,833		$	17,568,730		$	89,746,236		$	129,725,326
Assets Held for sales		—			—			—			1,670,652			—			2,365,620			—			—			—			4,036,272
Cash & Cash Equivalents		293,801			46,076			105,074			86,495			—			448,952			88,436			145,149			969,064			2,183,047
Rent Receivable		21,478			—			9,057			7,129			—			9,199			2,121			14,879			152,759			216,622
Real Estate Tax Escrow		95,544			—			18,171			—			—			—			28,519			183,649			316,132			642,015
Prepaid Expenses & Other Assets		77,490			697			53,813			362,044			—			315,996			25,703			71,449			1,291,561			2,198,753
Total Assets	$	8,103,867		$	2,645,070		$	6,511,791		$	2,126,320		$	—		$	3,139,767		$	6,015,612		$	17,983,856		$	92,475,752		$	139,002,035
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,893,135		$	—		$	9,672,846		$	—		$	—		$	—		$	5,887,818		$	16,792,991		$	81,898,222		$	124,145,012
Accounts Payable & Accrued Expense		57,811			1,700			56,417			11,151			—			23,049			49,540			137,282			750,666			1,087,616
Advance Rental Pmts & Security Deposits		313,218			—			234,870			11,649			—			19,365			76,426			361,677			2,469,208			3,486,413
Total Liabilities		10,264,164			1,700			9,964,133			22,800			—			42,414			6,013,784			17,291,950			85,118,096			128,719,041
Partners’ Capital		(2,160,297)			2,643,370			(3,452,342)			2,103,520			—			3,097,353			1,828			691,906			7,357,656			10,282,994
Total Liabilities and Capital	$	8,103,867		$	2,645,070		$	6,511,791		$	2,126,320		$	—		$	3,139,767		$	6,015,612		$	17,983,856		$	92,475,752		$	139,002,035
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,321,684		$	—		$	1,051,759		$	—		$	1,548,676		$	913		$	345,952		$	2,943,060			7,212,044
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,080,148)		$	—		$	(1,726,171)		$	—		$	—		$	—		$	—		$	—		$	—			(2,806,319)
Total Investment in Unconsolidated Joint Ventures (Net)																												$	4,405,725
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			—			—			—			42			148			409			689
Units to be sold		—			—			—			176			120			48			—			—			—			344
Units sold through February 1, 2018		—			—			—			159			120			31			—			—			—			310
Unsold units		—			—			—			17			—			17			—			—			—			34
Unsold units with deposits for future sale as of  February 1, 2018		—			—			—			7			—			4			—			—			—			11

F-26

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Summary financial information for the year ended December 31, 2017

			Hamilton										Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,404,006	$	227,856	$	1,473,098	$	352,888	$	5,557	$	544,482	$	1,024,570	$	3,359,971	$	14,983,834	$	23,376,262
Laundry and Sundry Income		15,424		—		5,380		—		—		—		2,620		37,968		101,131		162,523
		1,419,430		227,856		1,478,478		352,888		5,557		544,482		1,027,190		3,397,939		15,084,965		23,538,785
Expenses
Administrative		26,760		26,065		25,686		4,142		6,326		8,617		5,671		33,688		179,614		316,569
Depreciation and Amortization		456,728		2,830		348,502		82,383		81,655		181,152		349,910		1,005,595		3,376,142		5,884,897
Management Fees		59,873		9,114		61,513		13,056		253		19,947		39,976		133,138		323,136		660,006
Operating		70,847		—		70,599		458		38		4,239		87,284		360,706		1,146,768		1,740,939
Renting		37,474		—		36,194		392		181		241		7,992		36,767		282,022		401,263
Repairs and Maintenance		188,763		3,668		109,039		227,346		3,326		303,174		81,647		606,570		1,435,579		2,959,112
Taxes and Insurance		239,875		58,538		138,503		99,646		1,850		140,904		127,947		436,266		1,719,536		2,963,065
		1,080,320		100,215		790,036		427,423		93,629		658,274		700,427		2,612,730		8,462,797		14,925,851
Income Before Other Income		339,110		127,641		688,442		(74,535)		(88,072)		(113,792)		326,763		785,209		6,622,168		8,612,934
Other Income (Loss)
Interest Expense		(349,303)		—		(393,193)		(1,010)		(2)		(41,957)		(237,293)		(770,953)		(4,780,498)		(6,574,209)
Interest Income		—		—		—		—		—		—		—		—		—		—
Gain on Sale of Real Estate		—		—		—		2,379,763		133,297		3,628,205		—		—		—		6,141,265
		(349,303)		—		(393,193)		2,378,753		133,295		3,586,248		(237,293)		(770,953)		(4,780,498)		(432,944)
Net Income (Loss)	$	(10,193)	$	127,641	$	295,249	$	2,304,218	$	45,223	$	3,472,456	$	89,470	$	14,256	$	1,841,670	$	8,179,990
Net Income (Loss)—NERA 50%	$	(5,097)	$	63,821	$	147,625	$	1,152,109	$	22,612	$	1,736,228	$	44,735	$	7,127				3,169,159
Net Income —NERA 40%																	$	736,668		736,668
																			$	3,905,827

F-27

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Future annual mortgage maturities at December 31, 2017 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
12/31/2018	$	—	$	190,248	$	—	$	—	$	1,684,479	$	1,874,727
12/31/2019		—		197,742		—		—		80,320,017		80,517,759
12/31/2020		—		205,532		—		—				205,532
12/31/2021		—		213,629		—		—				213,629
12/31/2022		—		222,044		—		—				222,044
Thereafter		10,000,000		8,713,565		6,000,000		16,900,000		—		41,613,565
		10,000,000		9,742,760		6,000,000		16,900,000		82,004,496		124,647,256
Less: unamortized deferred financing costs		(106,865)		(69,914)		(112,182)		(107,009)		(106,274)		(502,244)
	$	9,893,135	$	9,672,846	$	5,887,818	$	16,792,991	$	81,898,222	$	124,145,012

At December 31, 2017 the weighted average interest rate on the above mortgages was 4.99%. The effective rate was 5.08% including the amortization expense of deferred financing costs.

F-28

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Summary financial information as of December 31, 2016

				Hamilton															Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	8,011,942		$	2,622,011		$	6,587,662		$	3,706,705		$	140,635		$	5,929,749		$	6,165,266		$	17,773,858		$	91,943,516		$	142,881,344
Cash & Cash Equivalents		167,953			52,321			57,635			144,831			18,576			923			47,795			95,294			1,496,250			2,081,578
Rent Receivable		25,604			—			9,840			10,568			2,452			5,520			—			6,133			204,956			265,073
Real Estate Tax Escrow		127,728			—			18,570			—			0			47,308			18,198			189,239			211,494			612,537
Prepaid Expenses & Other Assets		96,307			615			50,553			403,514			1,540			79,474			26,473			75,324			1,627,342			2,361,142
Total Assets	$	8,429,534		$	2,674,947		$	6,724,260		$	4,265,618		$	163,203		$	6,062,974		$	6,257,732		$	18,139,848		$	95,483,558		$	148,201,674
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,879,346		$	—		$	9,849,225		$	—		$	—		$	4,430,574		$	5,879,634		$	16,776,940		$	83,336,579		$	130,152,298
Accounts Payable & Accrued Expense		59,227			1,700			65,948			9,432			3,137			12,277			50,643			157,812			673,585			1,033,761
Advance Rental Pmts& Security Deposits		218,582			—			236,679			61,883			1,822			82,693			120,096			347,446			2,667,408			3,736,609
Total Liabilities		10,157,155			1,700			10,151,852			71,315			4,959			4,525,544			6,050,373			17,282,198			86,677,572			134,922,668
Partners’ Capital		(1,727,621)			2,673,247			(3,427,592)			4,194,303			158,244			1,537,430			207,359			857,650			8,805,986			13,279,006
Total Liabilities and Capital	$	8,429,534		$	2,674,947		$	6,724,260		$	4,265,618		$	163,203		$	6,062,974		$	6,257,732		$	18,139,848		$	95,483,558		$	148,201,674
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,336,623		$	—		$	2,097,151		$	79,122		$	768,714		$	103,679		$	428,824		$	3,522,393		$	8,336,505
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(863,810)		$	—		$	(1,713,796)		$	—		$	—		$	—		$	—		$	—		$	—			(2,577,606)
Total Investment in Unconsolidated Joint Ventures (Net)																												$	5,758,899
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			0			—			0			42			148			409			689
Units to be sold		—			—			—			176			120			48			—			—			—			344
Units sold through February 1, 2016		—			—			—			139			119			—			—			—			—			258
Unsold units		—			—			—			37			1			—			—			—			—			38
Unsold units with deposits for future sale as of February 1, 2016		—			—			—			5			1			—			—			—			—			6

F-29

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Summary financial information for the year ended December 31, 2016

													Hamilton		Hamilton
	Hamilton		Hamilton Essex		345		Hamilton		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,534,910	$	240,000	$	1,471,455	$	798,710	$	40,290	$	969,220	$	992,980	$	3,236,490	$	14,731,240	$	24,015,295
Laundry and Sundry Income		15,263		—		4,707		—		—		—		1,326		40,720		108,711		170,727
		1,550,173		240,000		1,476,162		798,710		40,290		969,220		994,306		3,277,210		14,839,951		24,186,022
Expenses
Administrative		31,400		1,740		34,512		9,636		6,295		10,768		6,557		48,753		187,176		336,837
Depreciation and Amortization		452,186		2,830		348,169		184,898		4,921		298,503		341,645		961,390		3,261,594		5,856,136
Management Fees		63,880		9,600		60,545		30,493		1,745		38,258		40,648		129,134		317,947		692,250
Operating		103,761		—		72,280		919		315		2,358		96,690		328,915		1,165,589		1,770,827
Renting		26,731		—		22,395		1,789		—		4,354		6,202		19,354		250,675		331,500
Repairs and Maintenance		157,398		3,150		66,606		296,423		22,054		413,972		84,307		558,988		1,391,171		2,994,069
Taxes and Insurance		227,148		58,725		130,867		161,984		9,236		164,667		121,365		476,185		1,541,959		2,892,136
		1,062,504		76,045		735,374		686,142		44,566		932,880		697,414		2,522,719		8,116,111		14,873,755
Income Before Other Income		487,669		163,955		740,788		112,568		(4,276)		36,340		296,892		754,491		6,723,840		9,312,267
Other Income (Loss)
Interest Expense		(289,041)		—		(397,726)		(150,061)		(71)		(261,440)		(286,628)		(772,201)		(4,875,137)		(7,032,305)
Interest Income		—		—		—		10		—		—		—		—		—		10
Other Inome		—		—		—		—		—		—		—		—		—		—
Gain on sale of real estate		—		—		—		1,324,174		337,251		—		—		—		—		1,661,425
		(289,041)		—		(397,726)		1,174,123		337,180		(261,440)		(286,628)		(772,201)		(4,875,137)		(5,370,870)
Net Income (Loss)	$	198,628	$	163,955	$	343,062	$	1,286,692	$	332,904	$	(225,100)	$	10,263	$	(17,710)	$	1,848,705	$	3,941,397
Net Income (Loss)—NERA 50%	$	99,314	$	81,978	$	171,530	$	643,346	$	166,451	$	(112,550)	$	5,132	$	(8,855)				1,046,345
Net Income —NERA 40%																	$	739,482		739,482
																			$	1,785,827

F-30

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Summary financial information for the year ended December 31, 2015

				Hamilton															Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			Hamilton on			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Main Apts			Park			Total
ASSETS
Rental Properties	$	8,419,054		$	2,618,666		$	6,780,019		$	4,939,620		$	573,138		$	6,174,512		$	6,352,363		$	18,574,474		$	94,250,027		$	148,681,873
Cash & Cash Equivalents		200,185			16,036			160,086			27,721			7,728			545			39,184			235,748			1,186,144			1,873,377
Rent Receivable		9,058			—			3,738			4,164			—			241			668			11,684			66,818			96,371
Real Estate Tax Escrow		33,643			—			15,322			80,196			—			51,218			40,499			81,815			210,446			513,139
Prepaid Expenses & Other Assets		104,975			565			37,088			56,048			12,879			63,345			41,201			67,496			1,898,655			2,282,252
Total Assets	$	8,766,915		$	2,635,267		$	6,996,253		$	5,107,749		$	593,745		$	6,289,861		$	6,473,915		$	18,971,217		$	97,612,090		$	153,447,012
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,865,557		$	—		$	9,916,769		$	4,728,751		$	—		$	4,497,183		$	5,208,820		$	16,760,889		$	84,680,020		$	135,657,989
Accounts Payable & Accrued Expense		69,413			1,700			63,268			28,736			12,605			14,594			55,116			216,091			792,707			1,254,230
Advance Rental Pmts& Security Deposits		202,470			—			221,871			91,649			5,799			95,552			113,084			328,675			2,482,079			3,541,179
Total Liabilities		10,137,440			1,700			10,201,908			4,849,136			18,404			4,607,329			5,377,020			17,305,655			87,954,806			140,453,398
Partners’ Capital		(1,370,525)			2,633,567			(3,205,655)			258,613			575,341			1,682,532			1,096,895			1,665,562			9,657,284			12,993,614
Total Liabilities and Capital	$	8,766,915		$	2,635,267		$	6,996,253		$	5,107,749		$	593,745		$	6,289,861		$	6,473,915		$	18,971,217		$	97,612,090		$	153,447,012
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,316,782		$	—		$	129,305		$	287,671		$	841,266		$	548,448		$	832,780		$	3,862,912			7,819,162
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(685,263)		$	—		$	(1,602,828)		$	—		$	—		$	—		$	—		$	—		$	—			(2,288,090)
																												$	5,531,072
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			48			—			48			42			148			409			786
Units to be sold		—			—			—			127			120			—			—			—			—			247
Units sold through February 1, 2015		—			—			—			127			115			—			—			—			—			242
Unsold units		—			—			—			—			5			—			—			—			—			5
Unsold units with deposits for future sale as of February 1, 2015		—			—			—			—			2			—			—			—			—			2

F-31

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

Summary financial information for the year ended December 31, 2015

			Hamilton						Hamilton				Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Bay		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,464,871	$	277,568	$	1,396,428	$	962,511	$	99,413	$	973,559	$	942,539	$	3,093,045	$	14,316,846	$	23,526,780
Laundry and Sundry Income		13,319		—		656		—		—		—		—		44,911		93,064		151,950
		1,478,190		277,568		1,397,084		962,511		99,413		973,559		942,539		3,137,956		14,409,910		23,678,730
Expenses
Administrative		28,849		2,000		35,071		6,262		8,105		8,592		5,402		48,818		225,509		368,608
Depreciation and Amortization		439,046		2,829		368,775		236,513		25,418		295,176		329,150		955,269		3,219,340		5,871,516
Management Fees		63,226		11,114		57,604		37,736		3,987		38,640		38,683		122,405		304,868		678,263
Operating		102,872		—		80,873		1,050		911		1,173		93,492		432,352		1,234,505		1,947,228
Renting		11,246		—		15,815		270		—		2,986		8,807		9,765		122,378		171,267
Repairs and Maintenance		153,329		200		61,183		314,409		43,559		362,861		82,769		393,665		1,134,751		2,546,726
Taxes and Insurance		216,602		52,846		124,266		166,842		20,461		154,348		124,393		341,990		1,548,439		2,750,187
		1,015,170		68,989		743,587		763,082		102,441		863,776		682,696		2,304,264		7,789,790		14,333,795
Income Before Other Income		463,020		208,579		653,497		199,429		(3,028)		109,783		259,843		833,692		6,620,120		9,344,935
Other Income (Loss)
Interest Expense		(432,732)		(46,283)		(398,414)		(281,093)		(322)		(265,636)		(308,725)		(769,579)		(4,937,726)		(7,440,510)
Interest Income		—		—				14		—		—		—		—		—		14
Other Inome		—		—		—		—		—		—		—		96		—		96
Gain on sale of real estate		—		—		—		—		169,093		—		—		—		—		169,093
		(432,732)		(46,283)		(398,414)		(281,079)		168,771		(265,636)		(308,725)		(769,483)		(4,937,726)		(7,271,307)
Net Income (Loss)	$	30,288	$	162,296	$	255,083	$	(81,651)	$	165,743	$	(155,854)	$	(48,883)	$	64,209	$	1,682,394	$	2,073,625
Net Income (Loss)—NERA 50%	$	15,144	$	81,148	$	127,543	$	(40,826)	$	82,872	$	(77,927)	$	(24,442)	$	32,105				195,617
Net Income —NERA 40%																	$	672,958		672,958
																			$	868,574

F-32

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

NOTE 15. IMPACT OF RECENTLY‑ISSUED ACCOUNTING STANDARDS

In February 2016, the FASB issued ASU 2016-02, modifying the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee.  This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively.  A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification.  Leases with a term of 12 months or less will be accounted for in the same manner as operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. The guidance supersedes previously issued guidance under ASC Topic 840 “Leases”. The guidance is effective on January 1, 2019, with early adoption permitted.  The Partnership is currently in the process of evaluating the impact the adoption of ASU 2016-02 will have on the Partnership’s consolidated financial statements.

In March 2016, the FASB issued ASU 2016-07, which eliminates a requirement for the retroactive adjustment on a step by step basis of the investment, results of operations, and retained earnings as if the equity method had been effective during all previous periods that the investment had been held when an investment qualifies for equity method accounting due to an increase in the level of ownership or degree of influence. The cost of acquiring the additional interest in the investee is to be added to the current basis of the investor’s previously held interest and the equity method of accounting should be adopted as of the date the investment becomes qualified for equity method accounting. This guidance is to be applied on a prospective basis and is effective for interim and annual periods beginning after December 15, 2016. Early adoption is permitted for financial statements that have not been previously issued. The adoption of ASU 2016-07 will have no significant impact on the Partnership’s consolidated financial statements. 

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses eight specific cash flow issues and intends to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This guidance is effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. The Partnership is currently in the process of evaluating the impact the adoption of ASU 2016-15 will have on the Partnership’s consolidated statement of cash flows.

NOTE 16. SALES OF REAL ESTATE

Gain on the Sale of property at Hamilton Green in 2016:
Sale price	$	1,000,000
Net book value		668,544
Expense of sale		227,013
Gain on the sale of real estate	$	104,443

F-33

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

NOTE 17. QUARTERLY FINANCIAL DATA (UNAUDITED)

	Three Months Ended
	March 31, 2017		June 30, 2017		September 30, 2017		December 31, 2017		Total
Revenue	$	12,743,607	$	12,787,791	$	13,421,805	$	13,874,185	$	52,827,388
Expenses		9,001,696		8,817,160		10,493,852		10,369,714		38,682,422
Income Before Other Income and Discontinued Operations		3,741,911		3,970,631		2,927,953		3,504,471		14,144,966
Other Expenses		(1,847,677)		(1,486,924)		(2,056,233)		(1,816,201)		(7,207,035)
Net Income	$	1,894,234	$	2,483,707	$	871,720	$	1,688,270	$	6,937,931
Net Income per Unit before Discontinued Operations	$	15.23	$	19.97	$	7.01	$	13.56	$	55.77
Net Income Per Unit	$	15.23	$	19.97	$	7.01	$	13.56	$	55.77
Income Per Depositary Receipt Before Discontinued Operations	$	0.51	$	0.67	$	0.23	$	0.45	$	1.86
Net Income Per Depositary Receipt	$	0.51	$	0.67	$	0.23	$	0.45	$	1.86

	Three Months Ended
	March 31, 2016		June 30, 2016		September 30, 2016		December 31, 2016		Total
Revenue	$	12,183,288	$	12,254,264	$	12,371,881	$	12,745,657	$	49,555,090
Expenses		8,768,697		9,019,667		9,274,045		9,232,731		36,295,140
Income Before Other Income and Discontinued Operations		3,414,591		3,234,597		3,097,836		3,512,926		13,259,950
Other Expenses		(2,183,827)		(2,254,011)		(1,887,089)		(1,984,171)		(8,309,098)
Net Income	$	1,230,764	$	980,586	$	1,210,747	$	1,528,755	$	4,950,852
Net Income  per Unit before Discontinued Operations	$	9.84	$	7.85	$	9.69	$	12.24	$	39.62
Net Income  Per Unit	$	9.84	$	7.85	$	9.69	$	12.24	$	39.62
Income Per Depositary Receipt Before Discontinued Operations	$	0.33	$	0.26	$	0.32	$	0.41	$	1.32
Net Income  Per Depositary Receipt	$	0.33	$	0.26	$	0.32	$	0.41	$	1.32

NOTE 18—SUBSEQUENT EVENTS

On March 9, 2018, Hamilton Highlands, LLC (“Buyer”), a Massachusetts limited liability company whose manager is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”) entered into a purchase and sale agreement (the “Purchase Agreement”) with Webster Green Apartments LLC, a Massachusetts limited liability company (the “Seller”) to acquire Webster Green Apartments,  a 79 unit apartment complex located at 755-757 Highland Avenue, Needham,  Massachusetts (the “Property”), for a purchase price of $34.5 million. In connection with the execution of the Purchase Agreement, Buyer paid into escrow a deposit in the amount of $500,000 to be applied against the purchase price at the closing of the purchase of the Property. The Buyer expects to assume a $21.5 million mortgage currently outstanding on the Property, with the balance of the purchase price to be paid from the Partnership’s cash reserves and line of credit. The Buyer’s sole member is New England Realty Associates Limited Partnership.

The closing of the acquisition of the Property is subject to numerous customary undertakings, covenants, obligations and conditions and is expected to be completed on or before March 31, 2018.

F-34

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2017

NOTE 19—QUALIFYING ACCOUNTS

New England Realty Associates Limited Partnership

Valuation and Qualifying Accounts

		Additions
	Balance at	Charged to	Charged to		Balance
	Beginning	Costs and	other account	Deductions	at end
Description	of Period	Expenses	describe	Describe(a)	of Period
Year Ended December 31, 2017:
Deducted from asset accounts:
Allowance for doubtful accounts	523,004	422,109		301,123	643,990
Year Ended December 31, 2016:
Deducted from asset accounts:
Allowance for doubtful accounts	372,828	365,746		215,570	523,004
Year Ended December 31, 2015:
Deducted from asset accounts:
Allowance for doubtful accounts	366,105	201,622		194,899	372,828

(a) Uncollectible accounts written off

F-35

EXHIBIT INDEX NOTE UPDATE IN CONJUNCTION WITH 12/31/17 EXHIBITS*****

Exhibit No.	Description of Exhibit
(3)	Second Amended and Restated Contract of Limited Partnership.(1)
(4)	(a)	Specimen certificate representing Depositary Receipts.(2)
	(b)	Description of rights of holders of Partnership securities.(2)
	(c)	Deposit Agreement, dated August 12, 1987, between the General Partner and the First National Bank of Boston.(3)
(10.1)	Purchase and Sale Agreement by and between Sally A. Starr and Lisa Brown, Trustees of Omnibus Realty Trust, a nominee trust.(5)
(10.2)	Commitment letter from Wachovia Multifamily Capital, Inc. to The Hamilton Company dated January 11, 2008.(6)
(10.3)	Amendment dated February 27, 2008 to Commitment letter from Wachovia Multifamily Capital, Inc. to The Hamilton Company dated January 11, 2008.(7)
(10.4)	Purchase and Sale and Escrow Agreement dated September 1, 2009 by and between 175 Free Street Investors LLC, as Seller, The Hamilton Company, as Purchaser, and First American Title Insurance Company, as Escrow Agent.(8)
(10.5)	Limited Liability Company Operating Agreement of HBC Holdings, LLC.(9)
(10.6)	Limited Liability Company Agreement of Hamilton Park Towers, LLC.(10)
(10.7)	Pledge Agreement dated October 28, 2009 by and between New England Realty Associates Limited Partnership and HBC Holdings, LLC.(11)
(10.8)	Promissory Note dated October 28, 2009 of New England Realty Associates Limited Partnership in favor of HBC Holdings, LLC.(12)
(10.9)	MultiFamily Note—CME of Hamilton Park Towers, LLC, as Borrower, in favor of Wachovia Multifamily Capital, Inc., as Lender, in the principal amount of $89,914,000 dated October 28, 2009.(13)
(10.10)	Purchase and sale agreement by and between Avon Street Apartments and 503‑509 Pleasant Street, LLC.(20)
(10.11)	Purchase and Sale Agreement dated May 20, 2011 by and between Battlegreen Apartments Trust and Hamilton Battle Green LLC(14).
(10.12)	Promissory Note dated June 1, 2011 by and between Avon Street Apartments Limited Partnership, as Maker, and Harold Brown, as Lender(15).
(10.13)	Pledge Agreement dated June 1, 2011 by and between Avon Street Apartments Limited Partnership, as Pledgor, and Harold Brown, as Pledgee(16).
(10.14)	Hamilton Green Purchase Agreement dated June 14, 2013(17)
(10.15)	Loan Agreement dated July 15, 2013(18)
(10.16)	Revolving Line of Credit dated July 31, 2014(19)
(10.17)	Purchase and Sale Agreement dated August 27, 2015, between Avalon II Massachusetts Value I, L.P., and the Residences at Captain Parker, LLC (25)
(10.18)	Multifamily  Loan and Security Agreement dated January 7, 2016 between Residences at Captain Parker, LLC (“Captain Parker”) and KeyBank National Association (“KeyBank”)(21)
(10.19)	Multifamily Note Floating Rate dated January 7, 2016,in the principal amount of $20,071,000 made by Captain Parker(22)
(10.20)	Multifamily Mortgage, Assignment of Rents, Security Agreement and Fixture filing Massachusetts dated January 7, 2016 between Captain Parker and Keybank (23)
(10.21)	Guaranty  dated January 7, 2016, made by New England realty associates Limited Partnership as a limited guarantor (24)
(10.22)	Offer to Purchase Agreement dated June 19, 2017 by and between New England Realty Associates Limited Partnership as buyer and M.J. Realty Trust II, as seller. (26)
(10.23)	Assignment and Assumption Agreement dated July 6, 2017, by and between New England Realty Associates Limited Partnership and M.J. Realty Trust II. (27)
(10.24)	Promissory Note dated July 6, 2017 in the principal amount of $16,000,000 payable to HBC Holdings, LLC, made by New England Realty Associates Limited Partnership.(28)
(10.25)	Pledge Agreement dated July 6, 2017, by and between New England Associates Limited Partnership and HBC Holdings, LLC.(29)
(21)	Subsidiaries of the Partnership.(4)

S-1

(31.1)	Certification pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002 of Ronald Brown, Principal Executive Officer of the Partnership (President and a Director of NewReal, Inc., sole General Partner of the Partnership)
(31.2)	Certification pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002 of Harold Brown, Principal Financial Officer of the Partnership (Treasurer and a Director of NewReal, Inc., sole General Partner of the Partnership)
(32.1)	Certification Pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, of Ronald Brown, Principal Executive Officer of the Partnership (President and a Director of NewReal, Inc., sole General Partner of the Partnership) and Harold Brown, Principal Financial Officer of the Partnership (Treasurer and a Director of NewReal, Inc., sole General Partner of the Partnership).
(99.1)	Combined Financial Statements of Significant Subsidiaries
(101.1)	The following financial statements from New England Realty Associates Limited Partnership Quarterly Report on Form 10‑K for the year ended December 31, 2017 formatted in XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Changes in Partners’ Capital, (iv) Consolidated Statements of Cash Flows, and (v) Notes to Consolidated Financial Statements.

(1) Incorporated by reference to Exhibit A to the Partnership’s Statement Furnished in Connection with the Solicitation of Consents filed under the Securities Exchange Act of 1934 on October 14, 1986.

(2) Incorporated herein by reference to Exhibit A to Exhibit 2(b) to the Partnership’s Registration Statement on Form 8‑A, filed under the Securities Exchange Act of 1934 on August 17, 1987.

(3) Incorporated herein by reference to Exhibit 2(b) to the Partnership’s Registration Statement on Form 8‑A, filed under the Securities Exchange Act of 1934 on August 17, 1987.

(4) Incorporated by reference to Notes 2 and 14 to Financial Statements included as part of this Form 10‑K.

(5) Incorporated by reference to Exhibit 2.1 to the Partnership’s Current Report on Form 8‑K dated June 30, 1995.

(6) Incorporated herein by reference to Exhibit 10.1 to the Partnership’s Current Report on Form 8‑K dated January 11, 2008 and filed with the Securities and Exchange Commission on February 6, 2008.

(7) Incorporated herein by reference to Exhibit 10.1 to the Partnership’s Current Report on Form 8‑K dated February 27, 2008 and filed with the Securities and Exchange Commission on March 4, 2008.

(8) Incorporated herein by reference to Exhibit 10.1 to the Partnership’s Quarterly Report on Form 10‑Q for the fiscal quarter ended September 30, 2009.

(9) Incorporated herein by reference to Exhibit 10.2 to the Partnership’s Quarterly Report on Form 10‑Q for the fiscal quarter ended September 30, 2009.

(10) Incorporated herein by reference to Exhibit 10.3 to the Partnership’s Quarterly Report on Form 10‑Q for the fiscal quarter ended September 30, 2009.

(11) Incorporated herein by reference to Exhibit 10.1 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on November 3, 2009.

(12) Incorporated herein by reference to Exhibit 10.2 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on November 3, 2009.

(13) Incorporated herein by reference to Exhibit 10.3 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on November 3, 2009.

S-2

(14) Incorporated herein by reference to Exhibit 10.1 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on May 26, 2011

(15) Incorporated herein by reference to Exhibit 10.1 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on June 7, 2011.

(16) Incorporated herein by reference to Exhibit 10.2 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on June 7, 2011.

(17) Incorporated by reference to Exhibit 10.1 to the Partnership’s Quarterly Report on Form 10‑Q as filed with the Securities and Exchange Commission on August 12, 2013.

(18) Incorporated by reference to Exhibit 10.2 to the Partnership’s Quarterly Report on Form 10‑Q as filed with the Securities and Exchange Commission on August 12, 2013.

(19) Incorporated herein by reference to Exhibit 10.2 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on August 6, 2014.

(20) Incorporated herein by reference to Exhibit 10.10 to the Partnership’s Form 10K as filed with the Securities and Exchange Commission on March 11, 2011.

(21) Incorporated herein by reference to Exhibit 10.1 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on January 14, 2016.

(22) Incorporated herein by reference to Exhibit 10.2 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on January 14, 2016.

(23) Incorporated herein by reference to Exhibit 10.3 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on January 14, 2016.

(24) Incorporated herein by reference to Exhibit 10.4 to the Partnership’s Current Report on Form 8‑K as filed with the Securities and Exchange Commission on January 14, 2016.

(25) Incorporated herein by reference to Exhibit 10.17 to the Partnership’s Form 10K as filed with the Securities and Exchange Commission on March 11, 2016.

(26) Incorporated herein by reference to Exhibit 10.2 to the partnership’s Current report on Form 8-K as filed with the securities and Exchange Commission on July 11, 2017.

(27) Incorporated herein by reference to Exhibit 10.3 to the partnership’s Current report on Form 8-K as filed with the securities and Exchange Commission on July 11, 2017.

(28) Incorporated herein by reference to Exhibit 10.4 to the partnership’s Current report on Form 8-K as filed with the securities and Exchange Commission on July 11, 2017.

(29) Incorporated herein by reference to Exhibit 10.5 to the partnership’s Current report on Form 8-K as filed with the securities and Exchange Commission on July 11, 2017.

S-3

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

New England Realty Associates Limited Partnership
By:	/s/ NewReal, Inc.
	Its General Partner
By:	/s/ Ronald Brown
	Ronald Brown, President

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Ronald Brown	President and Director of the General Partner (Principal	March 13, 2018
Ronald Brown	Executive Officer)
/s/ Harold Brown	Treasurer and Director of the General Partner (Principal	March 13, 2018
Harold Brown	Financial Officer and Principal Accounting Officer)
/s/ Guilliaem Aertsen	Director of the General Partner	March 13, 2018
Guilliaem Aertsen
/s/ David Aloise	Director of the General Partner	March 13, 2018
David Aloise
/s/ Eunice Harps	Director of the General Partner	March 13, 2018
Eunice Harps

S-4

EX-31.1

Exhibit 31.1

New England Realty Associates Limited Partnership

CERTIFICATION

I, Ronald Brown, certify that:

1.I have reviewed this Annual Report on Form 10‑K of New England Realty Associates Limited Partnership;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Ronald Brown

Principal Executive Officer

(President and Director of the

Partnership’s General Partner, NewReal, Inc.)

Date: March 13, 2018

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Harold Brown, certify that:

1.I have reviewed this Annual Report on Form 10‑K of New England Realty Associates Limited Partnership;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a‑15(f) and 15d‑15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Harold Brown

Principal Financial Officer

(Treasurer and Director of the

Partnership’s General Partner, NewReal, Inc.)

Date: March 13, 2018

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE

SARBANES‑OXLEY ACT OF 2002

In connection with the Annual Report on Form 10‑K of New England Realty Associates Limited Partnership for the year ended December 31, 2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Ronald Brown, as President and Director of the Partnership’s General Partner, NewReal, Inc., and Harold Brown, the President and a Director of the Partnership’s General Partner, NewReal, Inc., each hereby certifies, pursuant to 18.U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes‑Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ Ronald Brown

Ronald Brown

Principal Executive Officer

(President and Director of the

Partnership’s General Partner, NewReal, Inc.)

Date: March 13, 2018

/s/ Harold Brown

Harold Brown

Principal Financial Officer

(Treasurer and Director of the

Partnership’s General Partner, NewReal, Inc.)

Date: March 13, 2018

This certification accompanies each Report pursuant to §906 of the Sarbanes‑Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes‑Oxley Act of 2002, be deemed filed by the Partnership for purposes of §18 of the Security Exchange Act of 1934, as amended.

A signed original of this written statement required by §906 has been provided to the Partnership and will be retained by the Partnership and furnished to the Securities and Exchange Commission or its staff upon request.

EX-99.1

Exhibit 99.1

HAMILTON PARK TOWERS LLC

Financial Statements—Unconsolidated Significant Joint Venture

As of December 31, 2017 and 2016

and for the Years ended December 31, 2017, 2016 and 2015

Together With Report of Independent

Registered Public Accounting Firm

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Joint Venture Members of

Hamilton Park Towers LLC

Opinion on the Financial Statements

We have audited the accompanying balance sheets of Hamilton Park Towers LLC (the “Joint Venture”) as of December 31, 2017 and 2016, and the related statements of operation, changes in members’ capital, and cash flows for each of the years in the three period ended December 31, 2017, and the related notes  (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Joint Venture as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2017, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Joint Venture in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Joint Venture is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Miller Wachman LLP

We have served as the Joint Venture’s auditor since 2009.

Boston, MA

March 12, 2018

1

Hamilton Park Towers LLC

(Unconsolidated Significant Joint Venture)

Balance Sheets

	December 31,
	2017		2016
ASSETS
Rental Properties	$	89,746,236	$	91,943,516
Cash and Cash Equivalents		969,064		1,496,250
Rent Receivable		152,759		204,956
Real Estate Tax Escrow		316,132		211,494
Prepaid Expenses and Other Assets		1,291,561		1,627,342
Total Assets	$	92,475,752	$	95,483,558
LIABILITIES AND MEMBERS’ CAPITAL
Mortgage Note Payable	$	81,898,222	$	83,336,579
Accounts Payable and Accrued Expenses		750,666		673,585
Advance Rental Payments and Security Deposits		2,469,208		2,667,408
Total Liabilities		85,118,096		86,677,572
Commitments and Contingent Liabilities (Note7)
Members’ Capital		7,357,656		8,805,986
Total Liabilities and Members’ Capital	$	92,475,752	$	95,483,558
Member’s Capital—NERA 40%	$	2,943,060	$	3,522,393

See notes to accompany the financial statements.

2

Hamilton Park Towers, LLC

(Unconsolidated Significant Joint Venture)

Statements of Operation

	Year Ended December 31,
	2017		2016		2015
Revenues
Rental Income	$	14,983,834	$	14,731,240	$	14,316,846
Laundry and Sundry Income		101,131		108,711		93,064
		15,084,965		14,839,951		14,409,910
Expenses
Administrative		179,614		187,176		225,509
Depreciation and Amortization		3,376,142		3,261,594		3,219,340
Management Fees		323,136		317,947		304,868
Operating		1,146,768		1,165,589		1,234,505
Renting		282,022		250,675		122,378
Repairs and Maintenance		1,435,579		1,391,171		1,134,751
Taxes and Insurance		1,719,536		1,541,959		1,548,439
		8,462,797		8,116,111		7,789,790
Income Before Other Income		6,622,168		6,723,840		6,620,120
Other Income (Loss)
Interest Expense		(4,780,498)		(4,875,137)		(4,937,726)
		(4,780,498)		(4,875,137)		(4,937,726)
Net Income	$	1,841,670	$	1,848,703	$	1,682,394
NERA—40%	$	736,668	$	739,482	$	672,958

See notes to accompany the financial statements.

3

Hamilton Park Towers LLC

(Unconsolidated Significant Joint Venture)

Statements of Changes in Members’ Capital

	Hamilton
	Park Towers LLC
Balance, January 1, 2015	$	11,599,888
Distribution to members		(3,625,000)
Net Income		1,682,396
Balance, December 31, 2015	$	9,657,284
Distribution to members		(2,700,000)
Net Income		1,848,702
Balance, December 31, 2016	$	8,805,986
Distribution to members		(3,500,000)
Contribution		210,000
Net Income		1,841,670
Balance, December 31, 2017	$	7,357,656
Allocation to New England Realty Associations Limited Partnership for 2017:
Percentage Ownership		40	%
Distributions Received	$	(1,400,000)
Contribution	$	84,000
Net Income	$	736,668
Member’s Capital	$	2,943,060

See notes to accompany the financial statements.

4

HAMILTON PARK TOWERS LLC

(Unconsolidated Significant Joint Venture)

Statements of Cash Flow

	Year Ended December 31,
	2017		2016		2015
Cash Flows from Operating Activites
Net Income	$	1,841,670	$	1,848,703	$	1,682,396
Adjustments to reconcile net income to net cash provided by (used in) operating activites:
Depreciation and amortization		3,376,142		3,261,594		3,219,340
Amortization of deferred financing costs		58,316		58,316		58,316
Changes in operating assets and liabilities:
Decrease (Increase) in rent receivable		52,197		(138,138)		28,039
Increase (Decrease) in accounts payable and accrued expenses		77,081		(119,121)		(1,289)
(Increase) Decrease in real estate tax escrow		(104,638)		(1,048)		84,302
Decrease in prepaid expenses and other assets		335,781		271,314		18,481
(Decrease) Increase in advance rental payments and security deposits		(198,200)		185,328		257,257
Total adjustments		3,596,679		3,518,245		3,664,446
Net cash provided by operating activites		5,438,349		5,366,948		5,346,842
Cash flows from investing activites
Improvement of rental properties		(1,178,862)		(955,083)		(326,590)
Net cash (used in) investing activites		(1,178,862)		(955,083)		(326,590)
Cash flows from financing activites
Principal payments of mortgage notes payable		(1,496,673)		(1,401,758)		(1,337,888)
Investment by members		210,000		—		—
Distributions to members		(3,500,000)		(2,700,000)		(3,625,000)
Net cash (used in) financing activities		(4,786,673)		(4,101,758)		(4,962,888)
Net (Decrease) Increase in cash and cash equivalents		(527,186)		310,107		57,364
Cash and cash equivalents, at beginning of year		1,496,250		1,186,143		1,128,780
Cash and cash equivalents, at end of year	$	969,064	$	1,496,250	$	1,186,143
Supplementary cash flow statement information:
Cash paid for interest	$	4,677,060	$	4,771,975	$	4,835,845
Cash paid for state taxes	$	500	$	2,560	$	500

See notes to accompany the financial statements.

5

HAMILTON PARK TOWERS LLC

(Unconsolidated Significant Joint Venture)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2017

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

Line of Business:  Hamilton Park Towers LLC, (the “Joint Venture” or the “Property”), was organized in Massachusetts in 2009. The Joint Venture owns and operates 409 residential apartment units located in Brookline, Massachusetts. The Joint Venture is owned 40% by New England Realty Associates Limited Partnership (“NERA”) and is a “significant unconsolidated subsidiary” under Rule 3‑09 of Regulation S‑X requiring separated financial statements.

Basis of Preparation:  The preparation of the 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 the financial statements and the reported amounts of revenues and expenses during the reported period. Accordingly, actual results could differ from those estimates.

Revenue Recognition:  Rental income from residential properties is recognized over the term of the related leases. For residential tenants, amounts 60 days in arrears are charged against income. Concessions made on residential leases are accounted for on the straight‑line basis.

Above‑market and below‑market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the differences between (i) the contractual amounts to be paid pursuant to each in‑place lease and (ii) management’s estimate of fair market lease rates for each corresponding in‑place lease, measured over a period equal to the remaining term of the lease for above‑market leases and the initial term plus the term of any below‑market fixed‑rate renewal options for below‑market leases. The capitalized above‑market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining term of the respective leases, and the capitalized below‑market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below‑market fixed‑rate renewal options of the respective leases.

Rental Properties:  Rental properties are stated at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred; improvements and additions, which improve or extend the life of assets, are capitalized. When assets are retired or otherwise disposed of, the cost of the asset and related accumulated depreciation is eliminated from the accounts, and any gain or loss on such disposition is included in income. Fully depreciated assets are removed from the accounts. Rental properties are depreciated by both straight‑line and accelerated methods over their estimated useful lives. Significant acquisitions with long term leases are evaluated to determine if a portion of the purchase price is allocable to intangibles such as non‑market rate rents.

Upon acquisition of rental property, the Joint Venture estimated the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities assumed, generally consisting of the fair value of (i) above and below market leases, (ii) in‑place leases and (iii) tenant relationships. The Joint Venture allocated the purchase price to the assets acquired and liabilities assumed based on their fair values. The Joint Venture records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed exceed the purchase consideration of a transaction. In estimating the fair value of the tangible and intangible assets acquired, the Joint Venture considers information obtained about each property as a result of its due diligence and marketing and leasing activities, and utilizes various valuation methods, such as estimates cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it is vacant.

6

Other intangible assets acquired include amounts for in‑place lease values and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Joint Venture’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in‑place lease values include an estimate of carrying costs during hypothetical expected lease‑up periods considering current market conditions, and costs to execute similar leases. In estimating carrying costs, management includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease‑up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. Characteristics considered by management in valuing tenant relationships include the nature and extent of the Joint Venture’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of in‑place leases are amortized to expense over the remaining initial terms of the respective leases. The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.

In the event that facts and circumstances indicate that the carrying value of a rental property may be impaired, an analysis of the value is prepared. The estimated future undiscounted cash flows are compared to the asset’s carrying value to determine if a write‑down to fair value is required.

Leasing Fees: Leasing fees are capitalized and amortized on a straight‑line basis over the life of the related lease. Unamortized balances are expensed when the corresponding fee is no longer applicable.

Deferred Financing Costs:  Costs incurred in obtaining financing are capitalized and amortized over the term of the related indebtedness. Deferred financing costs are presented in the balance sheet as a direct deduction from the carrying value of the debt liability to which they relate. In all cases, amortization of such costs is included in interest expense and was approximately $58,000 for the years ended December 31, 2017, 2016, and 2015.

Income Taxes: The financial statements have been prepared on the basis that the joint venture is entitled to tax treatment as a partnership. Accordingly, no provision for income taxes has been recorded. (See note 10)

Cash Equivalents: The Joint Venture considers cash equivalents to be all highly liquid instruments purchased with a maturity of three months or less.

Comprehensive Income: Comprehensive income is defined as changes in members’ equity, exclusive of transactions with owners (such as capital contributions and dividends). The Joint Venture did not have any comprehensive income items in 2017, 2016, or 2015 other than net income as reported.

Concentration of Credit Risks and Financial Instruments: The Joint Venture property is located in Brookline, Massachusetts, and is subject to the general economic risks related thereto. No single tenant accounted for more than 5% of the revenues in 2017, 2016 or 2015. The Joint Venture makes its temporary cash investments with high‑credit‑quality financial institutions. At December 31, 2017 and 2016, respectively approximately $1,790,000 and $2,255,000 of cash and cash equivalents, and security deposits included in prepaid expenses and other assets exceeded federally insured amounts.

Advertising Expense: Advertising is expensed as incurred. Advertising expense was $39,000 in 2017, $16,000 in 2016 and $18,000 in 2015.

Interest Capitalized:  The Joint Venture follows the policy of capitalizing interest as a component of the cost of rental property when the time of construction exceeds one year. During the years ended December 31, 2017, 2016 and 2015 there was no capitalized interest.

Reclassifications:  Certain reclassifications have been made to prior period amounts in order to conform to current period presentation. The reclassifications were related primarily to conform to ASU No. 2015-03, Simplifying thePresentation of Debt Issuance Costs, which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the associated debt liability. This new standard was effective for interim and annual reporting beginning

7

after December 15, 2015 and requires retrospective application.. Amortization of deferred financing costs of approximately $58,000 was reclassified as interest expense for the year  ended December 31, 2015. There was no change to the net income for any period presented as a result of these reclassifications.

Subsequent Events:  The Joint Venture has evaluated subsequent events through March 10, 2018, the date the financial statements were issued.

NOTE 2. RENTAL PROPERTIES

Rental Properties Consist of the Following:

	Year Ended December 31,
	2017		2016		Useful Life
Land, Improvements and Parking Lots	$	30,347,421	$	30,339,451	15	–	40	years
Buildings and Improvements		72,768,584		72,704,085	15	–	40	years
Kitchen Cabinets		1,083,837		709,464	5	–	10	years
Carpets		583,153		321,811	5	–	10	years
Air Conditioning		52,743		71,928	5	–	10	years
Laundry Equipment		—		97,754	5	–	7	years
Elevators		2,093,364		2,034,882	20	–	40	years
Equipment		7,197,158		7,188,348	5	–	30	years
Furniture and Fixtures		824,070		541,864	5	–	7	years
Smoke Alarms		3,433		3,433	5	–	7	years
		114,953,763		114,013,020
Less Accumulated Depreciation		(25,207,527)		(22,069,504)
	$	89,746,236	$	91,943,516

8

	Hamilton Park
	Towers LLC
Rental Properties at Cost:
Balance, January 1, 2015	$	113,157,058
Additions		326,590
Write off of retired assets		(335,681)
Balance, December 31, 2015		113,147,967
Additions		955,083
Write off of retired assets		(90,030)
Balance, December 31, 2016		114,013,020
Additions		1,178,862
Write off of retired assets		(238,119)
Balance, December 31, 2017	$	114,953,763
Accumulated Depreciation:
Balance, January 1, 2015	$	16,014,281
Depreciation for year		3,219,340
Write off of retired assets		(335,681)
Balance, December 31, 2015		18,897,940
Depreciation for year		3,261,594
Write off of retired assets		(90,030)
Balance, December 31, 2016		22,069,504
Depreciation for year		3,376,142
Write off of retired assets		(238,119)
Balance, December 31, 2017	$	25,207,527
Net Book Value	$	89,746,236

NOTE 3. RELATED PARTY TRANSACTIONS

The Joint Venture’s property is managed by an entity that is owned by the majority shareholder of the General Partner. The management fee is equal to 2% at Hamilton Park Towers of gross receipts of rental revenue and laundry income. Total management fees paid were approximately $323,000, $318,000 and $303,000 in 2017, 2016 and 2015, respectively.

In 2017, the Management Company also received approximately $89,000 for construction supervision and architectural fees, $24,000 for maintenance services and $19,000 for administrative services.

In 2016, the Management Company also received approximately $10,000 for construction supervision and architectural fees, $46,000 for maintenance services and $24 ,000 for administrative services.

In 2015, the Management Company also received approximately $2,000 for construction supervision and architectural fees, $25,000 for maintenance services and $40,000 for administrative services.

NOTE 4. OTHER ASSETS

Approximately $1,018,000 and $1,034,000 of security deposits are included in prepaid expenses and other assets at December 31, 2017 and 2016, respectively. Security deposits and escrow accounts are restricted cash.

Included in prepaid expenses and other assets at December 31, 2017 and 2016 is approximately $17,000 and $377,000, respectively, held in replacement reserve escrow to fund future capital improvements.

9

NOTE 5. MORTGAGE NOTES PAYABLE

At December 31, 2017 and 2016, the mortgage payable is secured by a first mortgage on properties referred to in Note 2. At December 31, 2017, the interest rate on the loan is 5.57%, payable in monthly installments aggregating approximately $514,000, including interest, through October 2019. The mortgage is subject to prepayment penalties.

The Joint Venture has pledged tenant leases as additional collateral for this loan.

Approximate annual maturities at December 31, 2017 are as follows:

	Hamilton Park
	Towers LLC
2018	$	1,684,000
2019		80,320,000
		82,004,000
Less: unamortized deferred financing costs		106,000
	$	81,898,000

NOTE 6. ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

The Joint Venture’s residential lease agreements may require tenants to maintain a one‑month advance rental payment and/or a security deposit. Prepaid rents are approximately $1,407,000 and $1,582,000 at December 31, 2017 and 2016, respectively. Security deposits are approximately $1,018,000 and $1,034,000 at December 31, 2017 and 2016, respectively.

NOTE 7. COMMITMENTS AND CONTINGENCIES

From time to time, the Joint Venture may be involved in various ordinary routine litigation incidents to its business. The Joint Venture either has insurance coverage or provides for any uninsured claims when appropriate. The Joint Venture is not involved in any material pending legal proceedings.

NOTE 8. RENTAL INCOME

Substantially all rental income was related to residential apartments with leases of one year of less.

Rents receivable are approximately $153,000 and $205,000 net of allowances for doubtful accounts at December 31, 2017 and 2016, respectively.

NOTE 9. FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair Value Measurements on a Recurring Basis

At December 31, 2017 and 2016, we do not have any significant financial assets or financial liabilities that are measured at fair value on a recurring basis in our financial statements.

Financial Assets and Liabilities not Measured at Fair Value

At December 31, 2017 and 2016 the carrying amounts of certain of our financial instruments, including cash and cash equivalents, accounts receivable, and note payable, accounts payable and accrued expenses were representative of their fair values due to the short‑term nature of these instruments or, the recent acquisition of these items.

At December 31, 2017 and 2016, we estimated the fair value of our mortgage payable based upon quoted market prices for the same (Level 1) or similar (Level 2) issues when current quoted market prices are available. We

10

estimated the fair value of our secured mortgage debt that does not have current quoted market prices available by discounting the future cash flows using rates currently available to us for debt with similar terms and maturities (Level 3). The differences in the fair value of our debt from the carrying value are the result of differences in interest rates and/or borrowing spreads that were available to us at December 31, 2017 and 2016, as compared with those in effect when the debt was issued or acquired. The secured mortgage debt contain pre‑payment penalties or yield maintenance provisions that could make the cost of refinancing the debt at lower rates exceed the benefit that would be derived from doing so.

The following table reflects the carrying amounts and estimated fair value of our debt. 

		Carrying Amount		Estimated Fair Value
Mortgage Note Payable
At December 31, 2017	*	$	81,898,222	$	83,916,519
At December 31, 2016	*	$	83,336,579	$	87,687,588

      *Net of unamortized deferred financing costs

Disclosure about fair value of financial instruments is based on pertinent information available to management as of December 31, 2017 and 2016. Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2017 and current estimates of fair value may differ significantly from the amounts presented herein.

NOTE 10. TAXABLE INCOME AND TAX BASIS

The Joint Venture is not subject to income taxes as it files a partnership tax return whereby its income or loss is reportable by the members.

Taxable income or loss is different than financial statement income because of intangible assets, accelerated depreciation, different tax lives, and timing differences related to prepaid rents and allowances. The Partnership share of the taxable income is approximately $390,000 less than statement income for the year ended December 31, 2017. The cumulative tax basis of the Joint Venture real estate allocated to the Partnership at December 31, 2017 is approximately $1,010,000 more than the statement basis primarily due to the purchase price allocation to intangible assets at Hamilton Park Towers and accelerated depreciation.

The Joint Venture adopted the amended provisions related to uncertain tax provisions of ASC 740, Income Taxes. As a result of the implementation of the guidance, the Joint Venture recognized no material adjustments regarding its tax accounting treatment. The Joint Venture expects to recognize interest and penalties related to uncertain tax positions, if any, as income tax expense, which would be included in general and administrative expense.

In the normal course of business the Joint Venture is subject to examination by federal, state and local jurisdictions in which it operates, where applicable. As of December 31, 2017, the tax years that remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2013 forward.

NOTE 11. NEW ACCOUNTING PRONOUNCEMENTS 

In February 2016, the FASB issued ASU 2016-02, modifying the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee.  This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively.  A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification.  Leases with a term of 12 months or less will be accounted for in the same manner as operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. The

11

guidance supersedes previously issued guidance under ASC Topic 840 “Leases”. The guidance is effective on January 1, 2019, with early adoption permitted.  The Joint Venture is currently in the process of evaluating the impact the adoption of ASU 2016-02 will have on theJoint Venture’s financial statements.

In March 2016, the FASB issued ASU 2016-07, which eliminates a requirement for the retroactive adjustment on a step by step basis of the investment, results of operations, and retained earnings as if the equity method had been effective during all previous periods that the investment had been held when an investment qualifies for equity method accounting due to an increase in the level of ownership or degree of influence. The cost of acquiring the additional interest in the investee is to be added to the current basis of the investor’s previously held interest and the equity method of accounting should be adopted as of the date the investment becomes qualified for equity method accounting. This guidance is to be applied on a prospective basis and is effective for interim and annual periods beginning after December 15, 2016. Early adoption is permitted for financial statements that have not been previously issued. The adoption of ASU 2016-07 will have no significant impact on the Joint Venture’s financial statements. 

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses eight specific cash flow issues and intends to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This guidance is effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. The Joint Venture is currently in the process of evaluating the impact the adoption of ASU 2016-15 will have on the Joint Venture’s statement of cash flows.

12

XML

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2017	Mar. 01, 2018	Jun. 30, 2017
Entity Registrant Name	NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP
Entity Central Index Key	0000746514
Document Type	10-K
Document Period End Date	Dec. 31, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 158,399,885
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Class A
Entity Common Stock, Shares Outstanding		99,509
Class B
Entity Common Stock, Shares Outstanding		23,633

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2017	Dec. 31, 2016
ASSETS
Rental Properties	$ 207,153,794	$ 169,462,811
Cash and Cash Equivalents	7,238,905	7,463,697
Rents Receivable	592,045	567,627
Insurance Recovery Receivable		700,931
Real Estate Tax Escrows	488,396	444,625
Prepaid Expenses and Other Assets	4,122,052	3,585,870
Investments in Unconsolidated Joint Ventures	7,212,044	8,336,505
Total Assets	226,807,236	190,562,066
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	233,221,258	212,709,080
Notes Payable	17,000,000
Line of credit		17,000,000
Distribution and Loss in Excess of Investment in Unconsolidated Joint Venture	2,806,319	2,577,606
Accounts Payable and Accrued Expenses	3,340,509	4,052,095
Advance Rental Payments and Security Deposits	5,754,327	5,448,011
Total Liabilities	262,122,413	224,786,792
Commitments and Contingent Liabilities (Notes 3 and 9)
Partners’ Capital 124,386 and 124,409 units outstanding in 2017 and 2016 respectively	(35,315,177)	(34,224,726)
Total Liabilities and Partners' Capital	$ 226,807,236	$ 190,562,066

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
CONSOLIDATED BALANCE SHEETS
Partners' Capital, units outstanding	124,386	124,409	125,374	127,653

XML

CONSOLIDATED STATEMENTS OF INCOME - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenues
Rental income	$ 52,370,221	$ 49,121,705	$ 45,074,655
Laundry and sundry income	457,167	433,385	406,059
Total Revenues	52,827,388	49,555,090	45,480,714
Expenses
Administrative	2,008,107	2,102,812	2,096,290
Depreciation and amortization	13,462,395	12,181,396	10,562,707
Management fee	2,159,458	2,029,171	1,869,977
Operating	5,227,502	4,822,921	4,939,662
Renting	632,232	636,803	487,225
Repairs and maintenance	8,378,639	8,258,263	6,998,592
Taxes and insurance	6,814,089	6,263,774	5,643,507
Income Before Other Income (Expense)	14,144,966	13,259,950	12,882,754
Other Income (Expense)
Interest income	1,284	1,025	1,596
Interest expense	(11,114,146)	(10,200,393)	(9,980,359)
Income from investments in unconsolidated joint ventures	3,905,827	1,785,827	868,574
Gain on sale of real estate		104,443
Total Other Income (Expense)	(7,207,035)	(8,309,098)	(9,110,189)
Income from Continuing Operations	6,937,931	4,950,852	3,772,565
Net Income	$ 6,937,931	$ 4,950,852	$ 3,772,565
Income per Unit
Net Income per Unit (in dollars per unit)	$ 55.77	$ 39.62	$ 29.86
Weighted Average Number of Units Outstanding (in units)	124,392	124,951	126,361

XML

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL - USD ($)	Subtotal	General Partnership	Treasury Units	Class A	Class B	Total
Balance at Dec. 31, 2014		$ (272,859)		$ (21,910,488)	$ (5,184,335)	$ (27,367,682)
Balance (in units) at Dec. 31, 2014	180,225	1,802	52,572	144,180	34,243	127,653
Increase (Decrease) in Partners' Capital
Distribution to Partners		$ (37,859)		$ (3,028,706)	$ (719,318)	$ (3,785,883)
Stock Buyback		(33,878)		(2,752,393)	(643,682)	$ (3,429,953)
Stock Buyback (in units)			(2,279)			(2,279)
Net income		37,726		3,018,052	716,787	$ 3,772,565
Balance at Dec. 31, 2015		$ (306,870)		$ (24,673,535)	$ (5,830,548)	$ (30,810,953)
Balance (in units) at Dec. 31, 2015	180,225	1,802	54,851	144,180	34,243	125,374
Increase (Decrease) in Partners' Capital
Distribution to Partners		$ (67,297)		$ (5,383,743)	$ (1,278,639)	$ (6,729,679)
Stock Buyback		(16,181)		(1,311,328)	(307,436)	$ (1,634,945)
Stock Buyback (in units)			(965)			(965)
Net income		49,508		3,960,682	940,662	$ 4,950,852
Balance at Dec. 31, 2016		$ (340,840)		$ (27,407,924)	$ (6,475,961)	$ (34,224,726)
Balance (in units) at Dec. 31, 2016	180,225	1,802	55,816	144,180	34,243	124,409
Increase (Decrease) in Partners' Capital
Gain (Loss) on Disposition of Oil and Gas and Timber Property						$ 104,443
Distribution to Partners		$ (79,858)		$ (6,388,668)	$ (1,517,309)	(7,985,835)
Stock Buyback		(426)		(34,038)	(8,084)	$ (42,548)
Stock Buyback (in units)			(23)			(23)
Net income		69,379		5,550,345	1,318,207	$ 6,937,931
Balance at Dec. 31, 2017		$ (351,745)		$ (28,280,285)	$ (6,683,147)	$ (35,315,177)
Balance (in units) at Dec. 31, 2017	180,225	1,802	55,839	144,180	34,243	124,386

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Cash Flows from Operating Activities
Net income	$ 6,937,931	$ 4,950,852	$ 3,772,565
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	13,462,395	12,181,396	10,562,707
Amortization of deferred finance costs	192,944	188,256	171,066
(Income) from investments in joint venture	(3,905,827)	(1,785,827)	(868,574)
Gain on sale of real estate		(104,443)
Change in operating assets and liabilities
Decrease in rents receivable	(24,418)	(133,883)	40,481
(Decrease) in accounts payable and accrued expense	(400,368)	(588,672)	1,541,650
Decrease in insurance recovery receivable	329,493	(355,286)	(345,645)
Decrease (Increase) in real estate tax escrow	(43,771)	(73,644)	(30,640)
Decrease in prepaid expenses and other assets	(716,583)	724,308	(1,597,603)
Increase in advance rental payments and security deposits	306,316	339,168	560,114
Total Adjustments	9,200,181	10,391,373	10,033,556
Net cash provided by operating activities	16,138,112	15,342,225	13,806,121
Cash Flows From Investing Activities
Proceeds from unconsolidated joint ventures	7,463,750	3,515,100	2,872,378
Distribution in excess of investment in unconsolidated joint ventures	542,241	515,362	990,262
(Investment) in unconsolidated joint ventures	(2,746,991)	(2,472,462)	(1,142,640)
Improvement of rental properties	(5,795,148)	(5,163,081)	(6,693,996)
Purchase of rental property	(44,989,328)		(6,201,930)
Net proceeds from the sale of real estate		772,987
Net cash (used in) investing activities	(45,525,476)	(2,832,094)	(10,175,926)
Cash Flows from Financing Activities
Payment of financing costs	(304,529)	(174,718)
Proceeds of mortgage notes payable	22,250,000	20,071,000
Proceeds of note payable	41,000,000
Payment of note payable	(24,000,000)	(25,000,000)
Principal payments of mortgage notes payable	(1,754,516)	(1,876,278)	(132,071)
Stock buyback	(42,548)	(1,634,945)	(3,429,953)
Distributions to partners	(7,985,835)	(6,729,679)	(3,785,883)
Net cash (used in) financing activities	29,162,572	(15,344,620)	(7,347,907)
Net (Decrease) in Cash and Cash Equivalents	(224,792)	(2,834,489)	(3,717,712)
Cash and Cash Equivalents, at beginning of period	7,463,697	10,298,186	14,015,898
Cash and Cash Equivalents, at end of period	$ 7,238,905	$ 7,463,697	$ 10,298,186

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SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2017

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

Line of Business:  New England Realty Associates Limited Partnership (“NERA” or the “Partnership”) was organized in Massachusetts in 1977. NERA and its subsidiaries own 26 properties which include 18 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,632 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a  40-50% interest in 9 residential and mixed use properties consisting of 722 apartment units, 12,500 square feet of commercial space and a 50 car parking lot. The properties are located in Eastern Massachusetts and Southern New Hampshire.

Basis of Presentation: The financial statements have been prepared in conformity with GAAP. The preparation  of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. These estimates and assumptions are based on management’s historical experience that are believed to be reasonable at the time. However, because future events and their effects cannot be determined with certainty, the determination of estimates requires the exercise of judgement. The Partnership’s critical accounting policies are those which require assumptions to be made about matters that are highly uncertain. Different estimates could have a material effect on the Partnership’s financial results. Judgements and uncertainties affecting the application of these policies and estimates may result in materially different amounts being reported under different conditions and circumstances.

Principles of Consolidation:  The consolidated financial statements include the accounts of NERA and its subsidiaries. NERA has a 99.67% to 100% ownership interest in each subsidiary except for the nine limited liability companies (the “Investment Properties” or “Joint Ventures”) in which the Partnership has a 40 ‑ 50% ownership interest. The consolidated group is referred to as the “Partnership”. Minority interests are not recorded, since they are insignificant. All significant intercompany accounts and transactions are eliminated in consolidation. The Partnership accounts for its investment in the above‑mentioned Investment Properties using the equity method of consolidation. (See Note 14: Investments in Unconsolidated Joint Ventures).

The Partnership accounts for its investments in joint ventures using the equity method of accounting. These investments are recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions. Generally, the Partnership would discontinue applying the equity method when the investment (and any advances) is reduced to zero and would not provide for additional losses unless the Partnership has guaranteed obligations of the venture or is otherwise committed to providing further financial support for the investee. If the investment subsequently generates income, the Partnership only recognizes its share of such income to the extent it exceeds its share of previously unrecognized losses. In 2013 and beyond, the carrying values of  certain  investments fell below zero. We intend to fund our share of the investments’ future operating deficits should the need arise. However, we have no legal obligation to pay for any of the liabilities of such investments nor do we have any legal obligation to fund operating deficits. (See Note 14: Investment in Unconsolidated Joint Ventures.)

The authoritative guidance on consolidation provides guidance on the identification of entities for which control is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and the determination of which business enterprise, if any, should consolidate the VIE (the “primary beneficiary”). Generally, the consideration of whether an entity is a VIE applies when either (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest, (2) the equity investment at risk is insufficient to finance that equity’s activities without additional subordinated financial support or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The primary beneficiary is defined by the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the variable interest entity’s performance; and (2) the obligation to absorb losses and rights to receive the returns from VIE that would be significant to the VIE.

Impairment:  On an annual basis management assesses whether there are any indicators that the value of the Partnership’s rental properties or investments in unconsolidated subsidiaries may be impaired. In addition to identifying   any specific circumstances which may affect a property or properties, management considers other criteria for determining which properties may require assessment for potential impairment. The criteria considered by management include reviewing low leased percentages, significant near term lease expirations, recently acquired properties, current and historical operating and/or cash flow losses, near term mortgage debt maturities or other factors that might impact the Partnership’s intent and ability to hold property. A property’s value is impaired only if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property over the fair value of the property. The Partnership’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved.

Revenue Recognition:  Rental income from residential and commercial properties is recognized over the term of the related lease. For residential tenants, amounts 60 days in arrears are charged against income. The commercial tenants are evaluated on a case by case basis. Certain leases of the commercial properties provide for increasing stepped minimum rents, which are accounted for on a straight‑line basis over the term of the lease. Contingent rent for commercial properties are received from tenants for certain costs as provided in the lease agreement. The costs generally include real estate taxes, utilities, insurance, common area maintenance and recoverable costs. Rental concessions are also accounted for on the straight‑line basis.

Above‑market and below‑market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the differences between (i) the contractual amounts to be paid pursuant to each in‑place lease and (ii) management’s estimate of fair market lease rates for each corresponding in‑place lease, measured over a period equal to the remaining term of the lease for above‑market leases and the initial term plus the term of any below‑market fixed‑rate renewal options for below‑market leases. The capitalized above‑market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining term of the respective leases, and the capitalized below‑market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below‑market fixed‑rate renewal options of the respective leases.

Rental Properties:  Rental properties are stated at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred; improvements and additions which improve or extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost of the asset and related accumulated depreciation is eliminated from the accounts, and any gain or loss on such disposition is included in income. Fully depreciated assets are removed from the accounts. Rental properties are depreciated by both straight‑line and accelerated methods over their estimated useful lives. Upon acquisition of rental property, the Partnership estimates the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities assumed, generally consisting of the fair value of (i) above and below market leases, (ii) in‑place leases and (iii) tenant relationships. The Partnership allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. The Partnership records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed exceed the purchase consideration of a transaction. In estimating the fair value of the tangible and intangible assets acquired, the Partnership considers information obtained about each property as a result of its due diligence and marketing and leasing activities, and utilizes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.

Other intangible assets acquired include amounts for in‑place lease values and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Partnership’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in‑place lease values include an estimate of carrying costs during hypothetical expected lease‑up periods considering current market conditions, and costs to execute similar leases at market rates during the expected lease‑up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. Characteristics considered by management in valuing tenant relationships include the nature and extent of the Partnership’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of in‑place leases are amortized to expense over the remaining initial terms of the respective leases. The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.

In the event that facts and circumstances indicate that the carrying value of a rental property may be impaired, an analysis of the value is prepared. The estimated future undiscounted cash flows are compared to the asset’s carrying value to determine if a write‑down to fair value is required.

Leasing Fees: Leasing fees are capitalized and amortized on a straight‑line basis over the life of the related lease. Unamortized balances are expensed when the corresponding fee is no longer applicable.

Deferred Financing Costs:  Costs incurred in obtaining financing are capitalized and amortized over the term of the related indebtedness. Deferred financing costs are presented in the balance sheet as a direct deduction from the carrying value of the debt liability to which they relate, except deferred financing costs related to the revolving credit facility, which are presented in prepaid expenses and other assets. In all cases, amortization of such costs is included in interest expense and was approximately $193,000,  $188,000 and $171,000 for the years ended December 31, 2017, 2016 and 2015 respectively.

Income Taxes:  The financial statements have been prepared on the basis that NERA and its subsidiaries are entitled to tax treatment as partnerships. Accordingly, no provision for income taxes have been recorded (See Note 13).

Cash Equivalents:  The Partnership considers cash equivalents to be all highly liquid instruments purchased with a maturity of three months or less.

Segment Reporting:  Operating segments are revenue producing components of the Partnership for which separate financial information is produced internally for management. Under the definition, NERA operated, for all periods presented, as one segment.

Comprehensive Income:  Comprehensive income is defined as changes in partners’ equity, exclusive of transactions with owners (such as capital contributions and dividends). NERA did not have any comprehensive income items in 2017, 2016, or 2015 other than net income as reported.

Income (Loss) Per Depositary Receipt:  Effective January 3, 2012, the Partnership authorized a 3‑for‑1 forward split of its Depositary Receipts listed on the NYSE Amex and a concurrent adjustment of the exchange ratio of Depositary Receipts for Class A Units of the Partnership from 10‑to‑1 to 30‑to‑1, such that each Depositary Receipt represents one‑thirtieth (1/₃₀) of a Class A Unit of the Partnership. All references to Depositary Receipts in the report are reflective of the 3‑ for‑1 forward split.

Income Per Unit:  Net income per unit has been calculated based upon the weighted average number of units outstanding during each period presented. The Partnership has no dilutive units and, therefore, basic net income is the same as diluted net income per unit (see Note 7). 

Concentration of Credit Risks and Financial Instruments:  The Partnership’s properties are located in New England, and the Partnership is subject to the general economic risks related thereto. No single tenant accounted for more than 5% of the Partnership’s revenues in 2017, 2016, or 2015. The Partnership makes its temporary cash investments with high‑credit quality financial institutions. At December 31, 2017, substantially all of the Partnership’s cash and cash equivalents were held in interest‑bearing accounts at financial institutions, earning interest at rates from 0.01% to 0.20%. At December 31, 2017 and 2016, respectively approximately $8,898,000 and $8,911,000 of cash and cash equivalents, and security deposits included in prepaid expenses and other assets exceeded federally insured amounts.

Advertising Expense:  Advertising is expensed as incurred. Advertising expense was $201,040,  $191,815 and $165,070 in 2017, 2016 and 2015, respectively.

RentalPropertyHeld  for sale:When assets are identified by management as held for sale, the Partnership discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. The Partnership generally considers assets to be held for sale when the transaction has received appropriate corporate authority, and there are no significant contingencies relating to the sale. If, in management’s opinion, the estimated net sales price, net of selling costs, of the assets which have been identified as held for sale is less than the carrying value of the assets, a valuation allowance is established.

If circumstances arise that previously were considered unlikely and, as a result, the Partnership decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying value before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.

Interest Capitalized:  The Partnership follows the policy of capitalizing interest as a component of the cost of rental property when the time of construction exceeds one year. During the years ended December 31, 2017,  2016 and 2015 there was no capitalized interest.

Extinguishment of Debt:  When existing mortgages are refinanced with the same lender and it is determined that the refinancing is substantially different then they are recorded as an extinguishment of debt. However if it is determined that the refinancing is substantially the same then they are recorded as an exchange of debt. All refinancing qualify as extinguishment of debt.

Reclassifications:  Certain reclassifications have been made to prior period amounts in order to conform to current period presentation. The reclassifications were related primarily to conform to ASU No. 2015-03, Simplifying thePresentation of Debt Issuance Costs, Amortization of deferred financing costs of approximately $171,000 was reclassified as interest expense for the year ended December 31, 2015. There was no change to the net income for any period presented as a result of these reclassifications.

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RENTAL PROPERTIES

12 Months Ended

Dec. 31, 2017

RENTAL PROPERTIES

RENTAL PROPERTIES

NOTE 2. RENTAL PROPERTIES 

As of December 31, 2017, the Partnership and its Subsidiary Partnerships owned 2,632 residential apartment units in 22 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, 2017, 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, 2017 with a total of 722 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, 2017		December 31, 2016		Useful Life
Land, improvements and parking lots	$	65,087,214	$	52,612,929	15	-	40	years
Buildings and improvements		201,844,565		173,536,288	15	-	40	years
Kitchen cabinets		12,338,627		8,738,323	5	-	10	years
Carpets		8,802,831		7,621,292	5	-	10	years
Air conditioning		641,079		690,535	5	-	10	years
Laundry equipment		263,275		269,784	5	-	7	years
Elevators		1,139,296		1,139,296	20	-	40	years
Swimming pools		444,629		444,629	10	-	30	years
Equipment		11,163,864		10,029,639	5	-	30	years
Motor vehicles		216,260		237,954			5	years
Fences		37,465		37,465	5	-	15	years
Furniture and fixtures		9,390,021		8,127,100	5	-	7	years
Smoke alarms		582,471		174,059	5	-	7	years
Total fixed assets		311,951,597		263,659,293
Less: Accumulated depreciation		(104,797,803)		(94,196,482)
	$	207,153,794	$	169,462,811

							Cost
			Initial Cost to				Capitalized		Gross Amount at Which								Years
Property Name	Encumbrances		Partnerships(1)				Subsequent to		Carried at Close of Period								Built/	Depreciable
Type	(First				Buildings		Acquisition(2)				Buildings				Accumulated		Redecorated	Lives
Location	Mortgages)		Land		Improvements		Improvements		Land		Improvements		Totals		Depreciation		Date Acquired	Years
Boylston Downtown L.P. Residential Apartments Boston, Massachusetts	$	39,049,572	$	2,112,000	$	8,593,109	$	8,836,077	$	2,112,000	$	17,429,186	$	19,541,186	$	11,977,004	July 1995	(3)
Brookside Associates LLC Residential Apartments Woburn, Massachusetts	$	2,501,972	$	684,000	$	3,116,000	$	432,022	$	684,000	$	3,548,022	$	4,232,022	$	2,174,123	Oct. 2000	(3)
Clovelly Apartments L.P. Residential Apartments Nashua, New Hampshire	$	4,160,000	$	177,610	$	1,478,359	$	1,701,168	$	177,610	$	3,179,527	$	3,357,137	$	2,250,924	Sept. 1977	(3)
Commonwealth 1137 L.P. Residential Apartments Boston, Massachusetts	$	3,750,000	$	342,000	$	1,367,669	$	1,196,072	$	342,000	$	2,563,741	$	2,905,741	$	1,765,386	July 1995	(3)
Commonwealth 1144 L.P. Residential Apartments Boston, Massachusetts	$	14,780,000	$	1,410,000	$	5,664,816	$	3,924,962	$	1,410,000	$	9,589,778	$	10,999,778	$	5,954,341	July 1995	(3)
Executive Apartments L.P. Residential Apartments Framingham, Massachusetts	$	2,415,000	$	91,400	$	740,360	$	1,286,060	$	91,400	$	2,026,420	$	2,117,820	$	1,225,043	Sept. 1977	(3)
Hamilton Battle Green LLC Residential Apartments Lexington, Massachusetts	$	4,460,057	$	1,341,737	$	8,457,497	$	159,257	$	1,341,737	$	8,616,754	$	9,958,491	$	2,314,831	Jun. 2011	(3)
Hamilton Cypress LLC Commercial - 1031 Exchange Brookline, Massachusetts	$	—	$	2,362,596	$	4,613,985	$	249,024	$	2,362,596	$	4,863,009	$	7,225,605	$	1,470,530	Oct. 2008	(3)
Hamilton Green Apartments, LLC Residential Apartments Andover, Massachusetts	$	36,555,470	$	16,054,336	$	44,794,438	$	581,025	$	16,054,336	$	45,375,463	$	61,429,799	$	15,460,634	Jul. 2013	(3)
Hamilton Linewt LLC Commercial - 1031 Exchange Newton, Massachusetts	$	—	$	884,042	$	2,652,127	$	138,904	$	884,042	$	2,791,031	$	3,675,073	$	706,988	Nov. 2007	(3)
Hamilton Oaks Associates LLC Residential Apartments Brockton, Massachusetts	$	11,925,000	$	2,175,000	$	12,325,000	$	3,281,817	$	2,175,000	$	15,606,817	$	17,781,817	$	9,876,116	Dec. 1999	(3)
Highland Street Apartments, L.P. Residential Apartments Lowell, Massachusetts	$	1,050,000	$	156,000	$	634,085	$	274,024	$	156,000	$	908,109	$	1,064,109	$	647,937	Dec. 1996	(3)
Linhart L.P.  Residential / Commercial Newton, Massachusetts	$	—	$	385,000	$	1,540,000	$	1,585,649	$	385,000	$	3,125,649	$	3,510,649	$	2,245,989	Jan. 1995	(3)
NERA Dean St. Associates LLC Residential Apartments Norwood, Massachusetts	$	5,687,000	$	1,512,000	$	5,701,480	$	1,086,013	$	1,512,000	$	6,787,493	$	8,299,493	$	3,702,802	Jun. 2002	(3)
North Beacon 140 L.P. Residential Apartments Boston, Massachusetts	$	6,937,000	$	936,000	$	3,762,013	$	2,350,856	$	936,000	$	6,112,869	$	7,048,869	$	4,279,547	July 1995	(3)
Olde English Apartments L.P. Residential Apartments Lowell, Massachusetts	$	3,080,000	$	46,181	$	878,323	$	1,026,852	$	46,181	$	1,905,175	$	1,951,356	$	1,289,709	Sept. 1977	(3)
Redwood Hills L.P. Residential Apartments Worcester, Massachusetts	$	6,743,000	$	1,200,000	$	4,810,604	$	3,946,412	$	1,200,000	$	8,757,016	$	9,957,016	$	5,547,278	July 1995	(3)
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts	$	20,071,000	$	6,247,153	$	24,954,777	$	825,028	$	6,247,153	$	25,779,805	$	32,026,958	$	3,149,707	Sept. 2015	(3)
River Drive L.P. Residential Apartments Danvers, Massachusetts	$	3,465,000	$	72,525	$	587,777	$	1,033,453	$	72,525	$	1,621,230	$	1,693,755	$	840,124	Sept. 1977	(3)
Riverside Apartments Condominium Units Massachusetts	$	—	$	23,346	$	190,807	$	77,051	$	23,346	$	267,858	$	291,204	$	223,822	Sept. 1977	(3)
School St Assoc LLC Residential Apartments Framingham, Massachusetts	$	14,549,604	$	4,686,728	$	18,746,911	$	(346,294)	$	4,686,728	$	18,400,617	$	23,087,345	$	9,487,028	Apr. 2003	(3)
WRF Associates LLC Strip Mall Framingham, Massachusetts	$	6,000,000	$	3,280,000	$	4,920,000	$	82,460	$	3,280,000	$	5,002,460	$	8,282,460	$	3,070,591	May 1999	(3)
WCB Associates LLC Residential Apartments Brockton, Massachusetts	$	7,000,000	$	1,335,000	$	7,565,501	$	2,342,341	$	1,335,000	$	9,907,842	$	11,242,842	$	6,109,227	Dec. 1999	(3)
Westate Apartments Burlington LLC Residential Apartments Burlington, Massachusetts	$	2,500,000	$	44,965	$	4,478,687	$	225,772	$	44,965	$	4,704,459	$	4,749,424	$	2,325,390	Sept. 2004	(3)
Westgate Apartments LLC Residential Apartments Woburn, Massachusetts	$	15,700,000	$	461,300	$	2,424,636	$	7,149,052	$	417,107	$	9,573,688	$	9,990,795	$	5,681,385	Sept. 1977	(3)
Woodland Park Apartments LLC
Newton, Massachusetts	$	22,250,000	$	9,114,334	$	35,874,994	$	541,522	$	9,114,334	$	36,416,516	$	45,530,850	$	1,021,349	July 2017	(3)
	$	234,629,675	$	57,135,253	$	210,873,955	$	43,986,579	$	57,091,060	$	254,860,534	$	311,951,597	$	104,797,803

(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.

(3) In 2017, rental properties were depreciated over the following estimated useful lives:

Assets	Life
Buildings and Improvements	10	-	40	years
Other Categories of Assets	5	-	15	years

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

	December 31,
	2017		2016		2015
Rental Properties
Balance, Beginning	$	263,659,293	$	261,276,898	$	225,021,946
Additions:
Buildings, improvements and other assets		50,784,476		5,163,081		37,895,926
		314,443,769		266,439,979		262,917,872
Deduct:
Write-offs of retired or disposed assets		2,492,172		2,112,142		1,640,974
Rental properties held for sale and/or sold				668,544		—
Balance, Ending	$	311,951,597	$	263,659,293	$	261,276,898
Accumulated Depreciation
Balance, Beginning	$	94,196,482	$	84,579,584	$	75,905,862
Add:
Depreciation for the year		13,093,493		11,729,039		10,314,696
		107,289,975		96,308,623		86,220,558
Deduct
Accumulated depreciation of retired or disposed assets		2,492,172		2,112,141		1,640,974
Balance, Ending	$	104,797,803	$	94,196,482	$	84,579,584

On July 6, 2017, Woodland Park Partners, LLC, a newly formed subsidiary of the Partnership, purchased the Woodland Park Apartments, a 126-unit apartment complex located at 264-290 Grove Street, Newton, Massachusetts (the “Property”), for a purchase price of $45,600,000. The closing costs were approximately $64,000.

To fund the purchase price, the Partnership borrowed $25,000,000 under its outstanding line of credit with KeyBank, NA, and $16,000,000 from HBC Holdings, LLC, a Massachusetts limited liability company controlled by Harold Brown and  the Partnership’s cash reserves. On September 29, 2017, the Partnership obtained a mortgage on Woodland Park. The new mortgage is $22,250,000, interest is fixed at 3.79% for 10 years,interest only for the first  5 years, and the mortgage to be amortized over 30 years. The closing costs associated with the financing were approximately $176,000.  From the purchase price, the Partnership allocated approximately $541,000 for in-place leases, and approximately $42,000 to the value of tenant relationships. These amounts are being amortized over 12 and 24 months respectively.

On August 3, 2016, Hamilton Green Apartments, LLC sold a single family house contiguous with its apartment complex in Andover, Massachusetts.  The sale price of the property was $1,000,000 with closing costs of $227,663 and a cost basis of $668,544 resulting in a gain on the sale of $103,793.  Included in the closing costs is a mortgage prepayment penalty of $187,905. The proceeds from the sale were used to reduce the principal amount on the apartment complex’s mortgage.

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RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2017

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

NOTE 3. RELATED PARTY TRANSACTIONS

The Partnership’s properties are managed by an entity that is owned by the majority shareholder of the General Partner. The management fee is equal to 4% of gross receipts of rental revenue and laundry income on the majority of the Partnership’s properties and 3% on Linewt. Total fees paid were approximately $2,159,000,  $2,029,000 and $1,870,000 in 2017, 2016 and 2015, respectively.

The Partnership Agreement permits the General Partner or Management Company to charge the costs of professional services (such as counsel, accountants and contractors) to NERA. In 2017, 2016 and 2015, approximately $882,000,  $1,069,000 and $994,000, was charged to NERA for legal, accounting, construction, maintenance, rental and architectural services  supervision of capital improvements and brokerage commissions. Of the 2017 expenses referred to above, approximately $295,000 consisted of repairs and maintenance,  $359,000 of administrative expense, and $1,000 of brokerage commissions. Approximately $227,000 of expenses for construction, architectural services and supervision of capital projects were capitalized in rental properties. Additionally in 2017, the Hamilton Company received approximately $1,377,000 from the Investment Properties of which approximately $673,000 was the management fee, approximately $620,000 was for construction, architectural services and supervision of capital projects, approximately $44,000 was for maintenance services, and approximately $40,000 was for administrative services. The management fee is equal to 4% of gross receipts rental income on the majority of investment properties and 2% on Dexter Park.

The Partnership reimburses the management company for the payroll and related expenses of the employees who work at the properties. Total reimbursement was approximately $3,463,000,  $3,076,000 and $2,958,000 for the years ended December 31, 2017, 2016 and 2015, respectively. The Management Company maintains a 401K plan for all eligible employees whereby the employees may contribute the maximum allowed by law. The plan also provides for discretionary contributions by the employer. There were no employer contributions during 2017, 2016 or 2015.

Bookkeeping and accounting functions are provided by the Management Company’s accounting staff, which consists of approximately 14 people. During the years ended December 31, 2017, 2016 and 2015 the Management Company charged the Partnership $125,000 per year for bookkeeping and accounting services included in administrative expenses above.

The President of the Management Company performs asset management consulting services and receives an asset management fee from the Partnership. The Partnership does not have a written agreement with this individual. During the years ended December 31, 2017, 2016 and 2015 this individual received a quarterly fee of $18,750 for a total annual fee of $75,000.

To fund the purchase of Woodland Park as mentioned in Note 2, the Partnership borrowed $16,000,000  from HBC Holding LLC, on July 16, 2017, with interest only  at 4.75%. The loan was fully paid off through the financing of Woodland Park  as of Dcember 31,2017. The total interest expense  incurred was approximately $182,000.

The Partnership has invested in nine limited partnerships, which have invested in mixed use residential apartment complexes. The Partnership has a 40% to 50% ownership interest in each investment property. The other investors are Harold Brown, the President of the Management Company and five other employees of the Management Company. Harold Brown’s ownership interest is between 43.2% and 56 %. See Note 14 for a description of the properties and their operations.

The Advisory Committee held 4 meetings during 2017, and a total of $19,000 was paid for attendance and participation in such meetings. Additionally, the Audit Committee held 4 meetings in 2017 and a total of $12,000 was paid for attendance and participation in such meetings.

See Note 8 for information regarding the repurchase of Class B and General Partnership Units.

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OTHER ASSETS

12 Months Ended

Dec. 31, 2017

OTHER ASSETS

OTHER ASSETS

NOTE 4. OTHER ASSETS

Approximately $2,420,000 and $2,381,000 of security deposits are included in prepaid expenses and other assets at December 31, 2017 and 2016, respectively. The security deposits and escrow accounts are restricted cash.

Included in prepaid expenses and other assets at December 31, 2017 and 2016 is approximately $357,000 and $423,000, respectively, held in escrow to fund future capital improvements.

Intangible assets on the acquisitions of Woodland Park and the Residence at Captain Parkers are included in prepaid expenses and other assets. Intangible assets are approximately $302,000 net of accumulated amortization of approximately $280,000 and approximately $12,000 net of accumulated amortization of approximately $2,245,000 at December 31, 2017 and 2016, respectively.

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MORTGAGE NOTES PAYABLE

12 Months Ended

Dec. 31, 2017

MORTGAGE NOTES PAYABLE

MORTGAGE NOTES PAYABLE

NOTE 5. MORTGAGE NOTES PAYABLE

Mortgages Payable

At December 31, 2017 and 2016, the mortgages payable consisted of various loans, all of which were secured by first mortgages on properties referred to in Note 2. At December 31, 2017, the interest rates on these loans ranged from 3.24% to 5.97%, payable in monthly installments aggregating approximately $1,060,000, including principal, to various dates through 2029. The majority of the mortgages are subject to prepayment penalties. At December 31, 2017, the weighted average interest rate on the above mortgages was 4.59%. The effective rate of 4.67% 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.

 Financing fees of approximately $1,531,000 and $1,425,000 are net of accumulated amortization of approximately $1,149,000 and $1,061,000 at December 31, 2017 and 2016, respectively, which includes deferred financing costs for the line of credit of approximately $121,000 and $28,000 at December 31, 2017 and 2016, respectively.

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

Approximate annual maturities at December 31, 2017 are as follows:

2018—current maturities	$	7,843,000
2019		1,923,000
2020		4,331,000
2021		2,449,000
2022		2,686,000
Thereafter		215,397,000
		234,629,000
Less: unamortized deferred financing costs		1,408,000
	$	233,221,000

On September 29, 2017, Woodland Park Partners LLC, ( “Woodland Park”), entered into a Multifamily Loan and Security Agreement (the “Loan Agreement”) with KeyBank National Association (the “Lender”). The manager of Woodland Park is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Woodland Park. The Loan Agreement provides for a term loan (the “Loan”) in the principal amount of $22,250,000.  The Loan is due on October 1, 2027 (the “Due Date”), unless the due date is accelerated in accordance with the Loan’s terms, with interest only through October 1, 2022. Borrowings under the Loan will bear interest at the rate of 3.79%.  

On January 7, 2016, Captain Parker entered into a Multifamily Loan and Security Agreement (the “Loan Agreement”) with KeyBank National Association (the “Lender”). The manager of Captain Parker is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”).  The Partnership is the sole member of Captain Parker. The Loan Agreement provides for a term loan (the “Loan”) in the principal amount of $20,071,000.  The Loan is due on February 1, 2026 (the “Due Date”), unless the due date is accelerated in accordance with the Loan’s terms. Borrowings under the Loan will bear interest at rates equal to (i) the one month LIBOR rate for United States Dollar Deposits, determined monthly, plus 201 basis points. The interest rate increases upon an event of default.

Captain Parker is required to repay the aggregate principal amount of the Loan by the Due Date. Interest payments on the Loans are payable monthly in arrears on specified dates set forth in the Loan Agreement. Principal payments on the Loan are also payable monthly commencing on March 1, 2021.  The note issued by Captain Parker in connection with the Loan Agreement (the “Note”) also contains provisions for optional prepayment with a penalty under certain circumstances.

Line of Credit

On July 31, 2014, the Partnership entered into an agreement for a $25,000,000 revolving line of credit.  The term of the line was for three years with a floating interest rate equal to a base rate of the greater of (a) the Prime Rate (b) the Federal Funds Rate plus one-half of one percent per annum, or (c) the LIBOR Rate for a period of one month plus 1% per annum, plus the  applicable margin of 2.5%. 

The agreement originally expired on July 31, 2017, and was extended until October 31, 2020. The costs associated with the line of credit extension were approximately $128,000. The Partnership borrowed $25,000,000 to partially fund the purchase of Woodland Park. It paid down $8,000,000 through the financing of the property and its’ cash reserve. As of December 31, 2017, the credit line had an outstanding balance of $17,000,000.

On January 7, 2016, Captain Parker entered into a Multifamily Loan and Security Agreement (the “Loan Agreement”) with KeyBank National Association (the “Lender”). As a result of securing the financing, the Partnership used the proceeds of the loan and cash reserves of the Partnership to pay down the Line of Credit to zero. A payment was made on January 7, 2016 for $23,000,000, and another payment for $2,000,000 was made on January 15, 2016.

The line of credit may be used for acquisition, refinancing, improvements, working capital and other needs of the Partnership. The line may not be used to pay dividends, make distributions or acquire equity interests of the Partnership.

The line of credit is collateralized by varying percentages of the Partnership’s ownership interest in 23 of its subsidiary properties and joint ventures. Pledged interests range from 49% to 100% of the Partnership’s ownership interest in the respective entities.

The Partnership paid fees to secure the line of credit. Any unused balance of the line of credit is subject to a fee ranging from 15 to 20 basis points per annum. The Partnership paid approximately $29,000 during the year ended December 31, 2017.

The line of credit agreement has several covenants, such as providing cash flow projections and compliance certificates, as well as other financial information. The covenants include, but are not limited to the following: maintain a leverage ratio that does not exceed 65%; aggregate increase in indebtedness of the subsidiaries and joint ventures should not exceed $15,000,000; maintain a tangible net worth (as defined in the agreement) of a minimum of $150,000,000; a minimum ratio of net operating income to total indebtedness of at least 9.5%; debt service coverage ratio of at least 1.6 to 1, as well as other items. The Partnership is in compliance with these covenants as of December 31, 2017.

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ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

12 Months Ended

Dec. 31, 2017

ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

NOTE 6. ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

The Partnership’s residential lease agreements may require tenants to maintain a one-month advance rental payment and/or a security deposit. At December 31, 2017 and 2016 respectively, amounts received for prepaid rents of approximately $2,127,000 and $1,954,000 are included in cash and cash equivalents, and security deposits of approximately $2,420,000 and $2,381,000 are included in prepaid expenses and other assets and are restricted cash.

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PARTNERS' CAPITAL

12 Months Ended

Dec. 31, 2017

PARTNERS' CAPITAL

PARTNERS' CAPITAL

NOTE 7. PARTNERS’ CAPITAL

The Partnership has two classes of Limited Partners (Class A and B) and one category of General Partner. Under the terms of the Partnership Agreement, distributions to holders of Class B Units and General Partnership Units must represent 19% and 1%, respectively, of the total units outstanding. All classes have equal profit sharing and distribution rights, in proportion to their ownership interests.

Effective January 3, 2012, the Partnership authorized a 3‑for‑1 forward split of its Depositary Receipts listed on the NYSE Amex and a concurrent adjustment of the exchange ratio of Depositary Receipts for Class A Units of the Partnership from 10‑to‑1 to 30‑to‑1, such that each Depositary Receipt represents one‑thirtieth (1/₃₀) of a Class A Unit of the Partnership.

In January 2018, the Partnership approved a quarterly distribution to its Class A Limited Partners and holders of Depositary Receipts of record as of March 15, 2018 and payable on March 31, 2018, of $9.00 per unit ($0.30 per receipt).

In 2017, regular quarterly distributions of $9.00 per unit ($0.30 per receipt) were paid in March, June, September and December. In December 2017, the Partnership paid a special distribution of $28.50 per unit ($0.95 per receipt).

In 2016, regular quarterly distributions of $7.50 per unit ($0.25 per receipt) were paid in March, June, September and December. In December 2016, the Partnership paid a special distribution of $24.00 per unit ($0.80 per receipt).

The Partnership has entered into a deposit agreement with an agent to facilitate public trading of limited partners’ interests in Class A Units. Under the terms of this agreement, the holders of Class A Units have the right to exchange each Class A Unit for 30 Depositary Receipts. The following is information per Depositary Receipt:

	Year Ended
	December 31,
	2017		2016
Net Income per Depositary Receipt	$	1.86	$	1.32
Distributions per Depositary Receipt	$	2.15	$	1.80

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TREASURY UNITS

12 Months Ended

Dec. 31, 2017

TREASURY UNITS

TREASURY UNITS

NOTE 8. TREASURY UNITS

Treasury Units at December 31, 2017 are as follows:

Class A	44,671
Class B	10,609
General Partnership	559
	55,839

On August 20, 2007, NewReal, Inc., the General Partner authorized an equity repurchase program (“Repurchase Program”) under which the Partnership was permitted to purchase, over a period of twelve months, up to 300,000 Depositary Receipts (each of which is one‑tenth of a Class A Unit). Over time, the General Partner has authorized increases in the equity repurchase program. On March 10, 2015, the General Partner authorized an increase in the Repurchase Program to 2,000,000 Depository Receipts and extended the Program for an additional five years from March 31, 2015 until March 31, 2020. The Repurchase Program requires the Partnership to repurchase a proportionate number of Class B Units and General Partner Units in connection with any repurchases of any Depositary Receipts by the Partnership based upon the 80%,  19% and 1% fixed distribution percentages of the holders of the Class A, Class B and General Partner Units under the Partnership’s Second Amended and Restate Contract of Limited Partnership. Repurchases of Depositary Receipts or Partnership Units pursuant to the Repurchase Program may be made by the Partnership from time to time in its sole discretion in open market transactions or in privately negotiated transactions. From August 20, 2007 through December 31, 2017, the Partnership has repurchased 1,365,306 Depositary Receipts at an average price of $27.14 per receipt (or $814.20 per underlying Class A Unit), 3,072 Class B Units and 162 General Partnership Units, both at an average price of $ 926.26 per Unit, totaling approximately $40,274,000 including brokerage fees paid by the Partnership.

During the year ended December 31, 2017, the Partnership purchased a total of 549 Depositary Receipts. The average price was $62.00 per receipt or $1,860.00 per unit. The total cost including commission was $34,038. The Partnership was required to repurchase 4.3 Class B Units and 0.2 General Partnership units at a cost of $8,084 and $426 respectively.

During the year ended December 31, 2016, the Partnership purchased a total of 23,159 Depositary Receipts.  The average price was $55.89 per receipt or $1,676.70 per unit. The total cost including commissions was $1,311,328. The Partnership was required to repurchase 183 Class B Units and 10 General Partnership Units for a cost of $307,436 and $16,181, respectively.

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2017

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

NOTE 9. COMMITMENTS AND CONTINGENCIES

From time to time, the Partnership is involved in various ordinary routine litigation incidental to their business. The Partnership either has insurance coverage or provides for any uninsured claims when appropriate. The Partnership is not involved in any material pending legal proceedings.

On November 19, 2016, a pipe broke at 62 Boylston Street in Boston, MA. resulting in water damage to 24  apartments. The Partnership has insurance coverage on both the repairs and rental loss. As of December 31, 2017, the claim has been settled and the Partnership has received payments of approximately $329,000.

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RENTAL INCOME

12 Months Ended

Dec. 31, 2017

RENTAL INCOME

RENTAL INCOME

NOTE 10. RENTAL INCOME

During the year ended December 31, 2017, approximately 93% of rental income was related to residential apartments and condominium units with leases of one year or less. The majority of these leases expire in June, July and August. Approximately 7% was related to commercial properties, which have minimum future annual rental income on non‑cancellable operating leases at December 31, 2017 as follows:

	Commercial
	Property Leases
2018	$	2,623,000
2019		2,131,000
2020		1,767,000
2021		1,325,000
2022		565,000
Thereafter		1,159,000
	$	9,570,000

The aggregate minimum future rental income does not include contingent rentals that may be received under various leases in connection with common area charges and real estate taxes. Aggregate contingent rentals from continuing operations were approximately $642,000,  $616,000 and $683,000 for the years ended December 31, 2017, 2016 and 2015 respectively. Staples and Trader Joes, tenants at Staples Plaza are approximately 29% of the total commercial rental income.

The following information is provided for commercial leases:

	Annual base				Percentage of
	rent for		Total square feet	Total number of	annual base rent for
Through December 31,	expiring leases		for expiring leases	leases expiring	expiring leases
2018	$	499,878	19,724	14	17	%
2019		576,710	20,838	11	19	%
2020		185,494	4,461	6	6	%
2021		829,156	40,323	6	29	%
2022		486,772	12,218	6	16	%
2023		157,443	4,771	1	5	%
2024		94,184	1,858	1	3	%
2025		—	—	—	0	%
2026		—	—	—	0	%
2027		—	—	—	0	%
2028		—	—	—	0	%
2029		142,450	3,850	1	5	%
Totals	$	2,972,087	108,043	46	100	%

Rents receivable are net of an allowance for doubtful accounts of approximately $644,000 and $523,000 at December 31, 2017 and 2016. Included in rents receivable at December 31, 2017 is approximately $116,000 resulting from recognizing rental income from non‑cancelable commercial leases with future rental increases on a straight‑line basis. The majority of this amount is for long‑term leases at 62 Boylston Street in Boston, Massachusetts.

Rents receivable at December 31, 2017 also includes approximately $118,000 representing the deferral of rental concession primarily related to the residential properties.

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CASH FLOW INFORMATION

12 Months Ended

Dec. 31, 2017

CASH FLOW INFORMATION

CASH FLOW INFORMATION

NOTE 11. CASH FLOW INFORMATION

During the years ended December 31, 2017, 2016 and 2015, cash paid for interest was approximately $10,589,000,  $9,942,000 and $9,838,000 respectively. Cash paid for state income taxes was approximately $61,000,  $47,000 and $32,000 during the years ended December 31, 2017, 2016 and 2015 respectively. In 2015, the Partnership was involved in a non-cash financing activity of $25,000,000 in connection with the purchase of the residence at Captain Parker.

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FAIR VALUE MEASUREMENTS

12 Months Ended

Dec. 31, 2017

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

NOTE 12. FAIR VALUE MEASUREMENTS

Fair Value Measurements on a Recurring Basis

At December 31, 2017 and 2016, we do not have any significant financial assets or financial liabilities that are measured at fair value on a recurring basis in our consolidated financial statements.

Financial Assets and Liabilities not Measured at Fair Value

At December 31, 2017 and 2016 the carrying amounts of certain of our financial instruments, including cash and cash equivalents, accounts receivable, and notes payable, accounts payable and accrued expenses were representative of their fair values due to the short‑term nature of these instruments or, the recent acquisition of these items.

At December 31, 2017 and 2016, we estimated the fair value of our mortgages payable and other notes based upon quoted market prices for the same (Level 1) or similar (Level 2) issues when current quoted market prices are available. We estimated the fair value of our secured mortgage debt that does not have current quoted market prices available by discounting the future cash flows using rates currently available to us for debt with similar terms and maturities (Level 3). The differences in the fair value of our debt from the carrying value are the result of differences in interest rates and/or borrowing spreads that were available to us at December 31, 2017 and 2016, as compared with those in effect when the debt was issued or acquired. The secured mortgage debt contain pre‑payment penalties or yield maintenance provisions that could make the cost of refinancing the debt at lower rates exceed the benefit that would be derived from doing so.

At December 31, 2017, the Partnership’s  line of credit had an outstanding balance in the amount of $17,000,000, which represents its fair market value.

The following methods and assumptions were used by the Partnership in estimating the fair value of its financial instruments:

· For cash and cash equivalents, accounts receivable, other assets, investment in partnerships, accounts payable, advance rents and security deposits: fair value approximates the carrying value of such assets and liabilities.

· For mortgages and notes payable: fair value is generally based on estimated future cash flows, which are discounted using the quoted market rate from an independent source for similar obligations. Refer to the table below for the carrying amount and estimated fair value of such instruments.

The following table reflects the carrying amounts and estimated fair value of our debt.

		Carrying Amount		Estimated Fair Value
Mortgage Notes Payable
Partnership Properties
At December 31, 2017	*	$	233,221,258	$	237,895,708
At December 31, 2016	*	$	212,709,080	$	219,086,450
Investment Properties
At December 31, 2017	*	$	124,145,012	$	125,519,974
At December 31, 2016	*	$	130,152,297	$	133,991,269

*Net of unamortized deferred financing costs

Disclosure about fair value of financial instruments is based on pertinent information available to management as of December 31, 2017 and 2016. Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2017 and current estimates of fair value may differ significantly from the amounts presented herein.

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TAXABLE INCOME AND TAX BASIS

12 Months Ended

Dec. 31, 2017

TAXABLE INCOME AND TAX BASIS

TAXABLE INCOME AND TAX BASIS

NOTE 13. TAXABLE INCOME AND TAX BASIS

Taxable income reportable by the Partnership and includable in its partners’ tax returns is different than financial statement income because of tax free exchanges, accelerated depreciation, different tax lives, and timing differences related to prepaid rents, allowances and intangible assets at significant acquisitions. Taxable income of approximately $5,438,000 was approximately $1,500,000 less than statement income for the year ended December 31, 2017. The primary reason for the decrease is due to accelerated depreciation, tax free exchange and other differences in the treatment of certain expenditures. The cumulative tax basis of the Partnership’s real estate at December 31, 2017 is approximately $1,532,000 less than the statement basis. The primary reasons for the lower tax basis are tax free exchanges, and accelerated depreciation. The Partnership’s tax basis in its joint venture investments is approximately $5,000,000 more than statement basis.

Certain entities included in the Partnership’s consolidated financial statements are subject to certain state taxes. These taxes are not significant and are recorded as operating expenses in the accompanying consolidates financial statements.

The following reconciles GAAP net income to taxable income:

	For the year ended
	December 31,
	2017		2016		2015
	(in thousands)
Financial statement (“book”) net income	$	6,938	$	4,951	$	3,773
Book/Tax differences from depreciation and amortization		(3,097)		(1,411)		(2,513)
Book/Tax differences on tax free exchanges		1,344		1,257		501
Book/Tax differences from Investment Properties		—		(279)		(74)
Increase (Decrease) in prepaid rent and allowances		253		375		413
Other		—		—		6
Taxable income (loss)	$	5,438	$	4,893	$	2,106

Allowable accelerated depreciation deductions were extended through 2017. Future tax law changes may significantly affect taxable income.

The Partnership adopted the amended provisions related to uncertain tax provisions of ASC 740, Income Taxes. As a result of the implementation of the guidance, the Partnership recognized no material adjustments regarding its tax accounting treatment. The Partnership expects to recognize interest and penalties related to uncertain tax positions, if any, as income tax expense, which would be included in general and administrative expense.

In the normal course of business the Partnership or one of its subsidiaries is subject to examination by federal, state and local jurisdictions in which it operates, where applicable. As of December 31, 2017, the tax years that generally remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2014 forward.

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

12 Months Ended

Dec. 31, 2017

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

NOTE 14. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

The Partnership has invested in nine limited partnerships and limited liability companies, the majority of which have invested in residential apartment complexes, with three Joint Ventures investing in commercial property. The Partnership has between a 40%‑50% ownership interests in each investment. The other investors are Harold Brown, the President of the Management Company and five other employees of the Management Company. Harold Brown’s ownership interest is between 43.2% and 56%, with the balance owned by the others. A description of each investment is as follows:

On October 28, 2009 the Partnership invested approximately $15,925,000 in a joint venture to acquire a 40% interest in a residential property located in Brookline, Massachusetts. The property, Hamilton Park Towers LLC, referred to as Dexter Park, is a 409 unit residential complex. The purchase price was $129,500,000. The original mortgage was $89,914,000 with an interest rate of 5.57% and it matures in 2019. The mortgage calls for interest only payments for the first two years of the loan and amortized over 30 years thereafter. The balance of this mortgage before unamortized deferred financing costs is approximately $82,004,000 at December 31, 2017.  This investment, Hamilton Park Towers, LLC is referred to as Dexter Park.

On October 3, 2005, the Partnership invested $2,500,000 for a 50% ownership interest in a 168‑unit apartment complex in Quincy, Massachusetts. The purchase price was $30,875,000. The Joint Venture sold 120 units as condominiums and retained 48 units for long‑term investment. In February 2007, the Joint Venture refinanced the 48 units with a new 10 year mortgage in the original amount of $4,750,000 with an interest rate of 5.57%, interest only for five years. The loan was to be amortized over 30 years with a maturity date of  March 2017. On March 1, 2017, the mortgage balance was paid in full, with the Partnership contributing its share of the mortgage balance of approximately $2,222,000. As of December 31, 2017, 29 units had been sold with a gain on the sales of approximately $3,628,000. As of December 31, 2017, 6 additional units were under purchase and sale agreements, and the Partnership owned 19 units. Two units were sold in January 2018. This investment is referred to as Hamilton Bay Apartments, LLC.

During 2017, Hamilton Bay LLC, a Joint Ventire, sold one unit for a gain of approximately $133,000. As of December 31,2017, all units have been sold by this Joint Venture.

On March 7, 2005, the Partnership invested $2,000,000 for a 50% ownership interest in a building comprising 48 apartments, one commercial space and a 50‑car surface parking lot located in Boston, Massachusetts. The purchase price was $14,300,000, with a $10,750,000 mortgage. The Joint Venture planned to operate the building and initiate development of the parking lot. In June 2007, the Joint Venture separated the parcels, formed an additional limited liability company for the residential apartments and obtained a mortgage on the property. The new limited liability company formed for the residential apartments and commercial space is referred to as Hamilton Essex 81, LLC. In August 2008, the Joint Venture restructured the mortgages on both parcels at Essex 81. On September 28, 2015, Hamilton Essex Development, LLC paid off the outstanding mortgage balance of $1,952,286.  The Partnership made a capital contribution of $978,193 to Hamilton Essex Development LLC for its share of the funds required for the transaction.  Additionally, the Partnership made a capital contribution of $100,000 to Hamilton Essex 81, LLC.  On September 30, 2015, Hamilton Essex 81, LLC obtained a new 10 year mortgage in the amount of $10,000,000, interest only at 2.18% plus the one month Libor rate.  The proceeds of the note were used to pay off the existing mortgage of $8,040,719 and the Partnership received a distribution of $978,193 for its share of the excess proceeds. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. The investment in the parking lot is referred to as Hamilton Essex Development, LLC; the investment in the apartments is referred to as Hamilton Essex 81, LLC. At December 31, 2017, the balance on this mortgage before unamortized deferred financing costs is approximately $10,000,000.

On March 2, 2005, the Partnership invested $2,352,000 for a 50% ownership interest in a 176‑unit apartment complex with an additional small commercial building located in Quincy, Massachusetts. The purchase price was $23,750,000. The Partnership sold 127 of the units as condominiums and retained 49 units for long‑term investment. The Partnership obtained a new 10‑year mortgage in the amount of $5,000,000 on the units to be retained by the Partnership. The interest on the new loan was 5.67% fixed for the 10 year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan term. On July 8, 2016, Hamilton 1025 LLC paid off the outstanding balance of the mortgage balance. The Partnership made a capital contribution of $2,359,500 to Hamilton 1025, LLC for its share of the funds required for the transaction. 20 units were sold in the year ended December 31, 2017 with a gain on the sales of approximately $2,380,000. As of December 31, 2017, 8 units were under purchase and sales agreements and the Partnership owned 18 units. One unit was sold in January, 2018. This investment is referred to as Hamilton 1025, LLC.

In September 2004, the Partnership invested approximately $5,075,000 for a 50% ownership interest in a 42‑unit apartment complex located in Lexington, Massachusetts. The purchase price was $10,100,000. In October 2004, the Joint Venture obtained a mortgage on the property in the amount of $8,025,000 and returned $3,775,000 to the Partnership. The Joint Venture obtained a new 10‑ year mortgage in the amount of $5,500,000 in January 2007. The interest on the new loan was  5.67% fixed for the ten year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan. This loan required a cash contribution by the Partnership of $1,250,000 in December 2006. On September 12, 2016, the property was refinanced with a 15 year mortgage in the amount of $6,000,000, at 3.71%, interest only. The Joint Venture Partnership paid off the prior mortgage of approximately $5,158,000 with the proceeds of the new mortgage and made a distribution of $385,000 to the Partnership. The cost associated with the refinancing was approximately $123,000. At December 31, 2017, the balance on this mortgage before unamortized deferred financing costs is approximately $6,000,000. This investment is referred to as Hamilton Minuteman, LLC.

In August 2004, the Partnership invested $8,000,000 for a 50% ownership interest in a 280‑unit apartment complex located in Watertown, Massachusetts. The total purchase price was $56,000,000. The Joint Venture sold 137 units as condominiums. The assets were combined with Hamilton on Main Apartments. Hamilton on Main, LLC is known as Hamilton Place. In 2005, Hamilton on Main Apartments, LLC obtained a ten year mortgage on the three buildings to be retained. The mortgage was $16,825,000, with interest only of 5.18% for three years and amortizing on a 30 year schedule for the remaining seven years when the balance is due. The net proceeds after funding escrow accounts and closing costs on the mortgage were approximately $16,700,000, which were used to reduce the existing mortgage. In August 2014, the property was refinanced with a 10 year mortgage in the amount of $16,900,000 at 4.34% interest only.  The Joint Venture paid off the prior mortgage of approximately $15,205,000 with the proceeds of the new mortgage and distributed $850,000 to the Partnership. The costs associated with the refinancing were approximately $161,000. At December 31, 2017, the balance of the mortgage before unamortized deferred financing costs is approximately $16,900,000.The investment is referred to as Hamilton On Main LLC.

In November 2001, the Partnership invested approximately $1,533,000 for a 50% ownership interest in a 40-unit apartment building in Cambridge, Massachusetts. In June 2013, the property was refinanced with a 15 year mortgage in the amount of $10,000,000 at 3.87%, interest only for 3 years and is amortized on a 30‑year schedule for the balance of the term. The Joint Venture paid off the prior mortgage of approximately $6,776,000 with the proceeds of the new mortgage. After the refinancing, the Joint Venture  made a distribution of $1,610,000 to the Partnership. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. At December 31, 2017, the balance of this mortgage before unamortized deferred financing costs is approximately $9,743,000. This investment is referred to as 345 Franklin, LLC.

Summary financial information as of December 31, 2017

				Hamilton															Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,615,554		$	2,598,297		$	6,325,676		$	—		$	—		$	—		$	5,870,833		$	17,568,730		$	89,746,236		$	129,725,326
Assets Held for sales		—			—			—			1,670,652			—			2,365,620			—			—			—			4,036,272
Cash & Cash Equivalents		293,801			46,076			105,074			86,495			—			448,952			88,436			145,149			969,064			2,183,047
Rent Receivable		21,478			—			9,057			7,129			—			9,199			2,121			14,879			152,759			216,622
Real Estate Tax Escrow		95,544			—			18,171			—			—			—			28,519			183,649			316,132			642,015
Prepaid Expenses & Other Assets		77,490			697			53,813			362,044			—			315,996			25,703			71,449			1,291,561			2,198,753
Total Assets	$	8,103,867		$	2,645,070		$	6,511,791		$	2,126,320		$	—		$	3,139,767		$	6,015,612		$	17,983,856		$	92,475,752		$	139,002,035
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,893,135		$	—		$	9,672,846		$	—		$	—		$	—		$	5,887,818		$	16,792,991		$	81,898,222		$	124,145,012
Accounts Payable & Accrued Expense		57,811			1,700			56,417			11,151			—			23,049			49,540			137,282			750,666			1,087,616
Advance Rental Pmts & Security Deposits		313,218			—			234,870			11,649			—			19,365			76,426			361,677			2,469,208			3,486,413
Total Liabilities		10,264,164			1,700			9,964,133			22,800			—			42,414			6,013,784			17,291,950			85,118,096			128,719,041
Partners’ Capital		(2,160,297)			2,643,370			(3,452,342)			2,103,520			—			3,097,353			1,828			691,906			7,357,656			10,282,994
Total Liabilities and Capital	$	8,103,867		$	2,645,070		$	6,511,791		$	2,126,320		$	—		$	3,139,767		$	6,015,612		$	17,983,856		$	92,475,752		$	139,002,035
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,321,684		$	—		$	1,051,759		$	—		$	1,548,676		$	913		$	345,952		$	2,943,060			7,212,044
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,080,148)		$	—		$	(1,726,171)		$	—		$	—		$	—		$	—		$	—		$	—			(2,806,319)
Total Investment in Unconsolidated Joint Ventures (Net)																												$	4,405,725
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			—			—			—			42			148			409			689
Units to be sold		—			—			—			176			120			48			—			—			—			344
Units sold through February 1, 2018		—			—			—			159			120			31			—			—			—			310
Unsold units		—			—			—			17			—			17			—			—			—			34
Unsold units with deposits for future sale as of  February 1, 2018		—			—			—			7			—			4			—			—			—			11

Summary financial information for the year ended December 31, 2017

			Hamilton										Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,404,006	$	227,856	$	1,473,098	$	352,888	$	5,557	$	544,482	$	1,024,570	$	3,359,971	$	14,983,834	$	23,376,262
Laundry and Sundry Income		15,424		—		5,380		—		—		—		2,620		37,968		101,131		162,523
		1,419,430		227,856		1,478,478		352,888		5,557		544,482		1,027,190		3,397,939		15,084,965		23,538,785
Expenses
Administrative		26,760		26,065		25,686		4,142		6,326		8,617		5,671		33,688		179,614		316,569
Depreciation and Amortization		456,728		2,830		348,502		82,383		81,655		181,152		349,910		1,005,595		3,376,142		5,884,897
Management Fees		59,873		9,114		61,513		13,056		253		19,947		39,976		133,138		323,136		660,006
Operating		70,847		—		70,599		458		38		4,239		87,284		360,706		1,146,768		1,740,939
Renting		37,474		—		36,194		392		181		241		7,992		36,767		282,022		401,263
Repairs and Maintenance		188,763		3,668		109,039		227,346		3,326		303,174		81,647		606,570		1,435,579		2,959,112
Taxes and Insurance		239,875		58,538		138,503		99,646		1,850		140,904		127,947		436,266		1,719,536		2,963,065
		1,080,320		100,215		790,036		427,423		93,629		658,274		700,427		2,612,730		8,462,797		14,925,851
Income Before Other Income		339,110		127,641		688,442		(74,535)		(88,072)		(113,792)		326,763		785,209		6,622,168		8,612,934
Other Income (Loss)
Interest Expense		(349,303)		—		(393,193)		(1,010)		(2)		(41,957)		(237,293)		(770,953)		(4,780,498)		(6,574,209)
Interest Income		—		—		—		—		—		—		—		—		—		—
Gain on Sale of Real Estate		—		—		—		2,379,763		133,297		3,628,205		—		—		—		6,141,265
		(349,303)		—		(393,193)		2,378,753		133,295		3,586,248		(237,293)		(770,953)		(4,780,498)		(432,944)
Net Income (Loss)	$	(10,193)	$	127,641	$	295,249	$	2,304,218	$	45,223	$	3,472,456	$	89,470	$	14,256	$	1,841,670	$	8,179,990
Net Income (Loss)—NERA 50%	$	(5,097)	$	63,821	$	147,625	$	1,152,109	$	22,612	$	1,736,228	$	44,735	$	7,127				3,169,159
Net Income —NERA 40%																	$	736,668		736,668
																			$	3,905,827

Future annual mortgage maturities at December 31, 2017 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
12/31/2018	$	—	$	190,248	$	—	$	—	$	1,684,479	$	1,874,727
12/31/2019		—		197,742		—		—		80,320,017		80,517,759
12/31/2020		—		205,532		—		—				205,532
12/31/2021		—		213,629		—		—				213,629
12/31/2022		—		222,044		—		—				222,044
Thereafter		10,000,000		8,713,565		6,000,000		16,900,000		—		41,613,565
		10,000,000		9,742,760		6,000,000		16,900,000		82,004,496		124,647,256
Less: unamortized deferred financing costs		(106,865)		(69,914)		(112,182)		(107,009)		(106,274)		(502,244)
	$	9,893,135	$	9,672,846	$	5,887,818	$	16,792,991	$	81,898,222	$	124,145,012

At December 31, 2017 the weighted average interest rate on the above mortgages was 4.99%. The effective rate was 5.08% including the amortization expense of deferred financing costs.

Summary financial information as of December 31, 2016

				Hamilton															Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	8,011,942		$	2,622,011		$	6,587,662		$	3,706,705		$	140,635		$	5,929,749		$	6,165,266		$	17,773,858		$	91,943,516		$	142,881,344
Cash & Cash Equivalents		167,953			52,321			57,635			144,831			18,576			923			47,795			95,294			1,496,250			2,081,578
Rent Receivable		25,604			—			9,840			10,568			2,452			5,520			—			6,133			204,956			265,073
Real Estate Tax Escrow		127,728			—			18,570			—			0			47,308			18,198			189,239			211,494			612,537
Prepaid Expenses & Other Assets		96,307			615			50,553			403,514			1,540			79,474			26,473			75,324			1,627,342			2,361,142
Total Assets	$	8,429,534		$	2,674,947		$	6,724,260		$	4,265,618		$	163,203		$	6,062,974		$	6,257,732		$	18,139,848		$	95,483,558		$	148,201,674
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,879,346		$	—		$	9,849,225		$	—		$	—		$	4,430,574		$	5,879,634		$	16,776,940		$	83,336,579		$	130,152,298
Accounts Payable & Accrued Expense		59,227			1,700			65,948			9,432			3,137			12,277			50,643			157,812			673,585			1,033,761
Advance Rental Pmts& Security Deposits		218,582			—			236,679			61,883			1,822			82,693			120,096			347,446			2,667,408			3,736,609
Total Liabilities		10,157,155			1,700			10,151,852			71,315			4,959			4,525,544			6,050,373			17,282,198			86,677,572			134,922,668
Partners’ Capital		(1,727,621)			2,673,247			(3,427,592)			4,194,303			158,244			1,537,430			207,359			857,650			8,805,986			13,279,006
Total Liabilities and Capital	$	8,429,534		$	2,674,947		$	6,724,260		$	4,265,618		$	163,203		$	6,062,974		$	6,257,732		$	18,139,848		$	95,483,558		$	148,201,674
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,336,623		$	—		$	2,097,151		$	79,122		$	768,714		$	103,679		$	428,824		$	3,522,393		$	8,336,505
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(863,810)		$	—		$	(1,713,796)		$	—		$	—		$	—		$	—		$	—		$	—			(2,577,606)
Total Investment in Unconsolidated Joint Ventures (Net)																												$	5,758,899
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			0			—			0			42			148			409			689
Units to be sold		—			—			—			176			120			48			—			—			—			344
Units sold through February 1, 2016		—			—			—			139			119			—			—			—			—			258
Unsold units		—			—			—			37			1			—			—			—			—			38
Unsold units with deposits for future sale as of February 1, 2016		—			—			—			5			1			—			—			—			—			6

Summary financial information for the year ended December 31, 2016

													Hamilton		Hamilton
	Hamilton		Hamilton Essex		345		Hamilton		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,534,910	$	240,000	$	1,471,455	$	798,710	$	40,290	$	969,220	$	992,980	$	3,236,490	$	14,731,240	$	24,015,295
Laundry and Sundry Income		15,263		—		4,707		—		—		—		1,326		40,720		108,711		170,727
		1,550,173		240,000		1,476,162		798,710		40,290		969,220		994,306		3,277,210		14,839,951		24,186,022
Expenses
Administrative		31,400		1,740		34,512		9,636		6,295		10,768		6,557		48,753		187,176		336,837
Depreciation and Amortization		452,186		2,830		348,169		184,898		4,921		298,503		341,645		961,390		3,261,594		5,856,136
Management Fees		63,880		9,600		60,545		30,493		1,745		38,258		40,648		129,134		317,947		692,250
Operating		103,761		—		72,280		919		315		2,358		96,690		328,915		1,165,589		1,770,827
Renting		26,731		—		22,395		1,789		—		4,354		6,202		19,354		250,675		331,500
Repairs and Maintenance		157,398		3,150		66,606		296,423		22,054		413,972		84,307		558,988		1,391,171		2,994,069
Taxes and Insurance		227,148		58,725		130,867		161,984		9,236		164,667		121,365		476,185		1,541,959		2,892,136
		1,062,504		76,045		735,374		686,142		44,566		932,880		697,414		2,522,719		8,116,111		14,873,755
Income Before Other Income		487,669		163,955		740,788		112,568		(4,276)		36,340		296,892		754,491		6,723,840		9,312,267
Other Income (Loss)
Interest Expense		(289,041)		—		(397,726)		(150,061)		(71)		(261,440)		(286,628)		(772,201)		(4,875,137)		(7,032,305)
Interest Income		—		—		—		10		—		—		—		—		—		10
Other Inome		—		—		—		—		—		—		—		—		—		—
Gain on sale of real estate		—		—		—		1,324,174		337,251		—		—		—		—		1,661,425
		(289,041)		—		(397,726)		1,174,123		337,180		(261,440)		(286,628)		(772,201)		(4,875,137)		(5,370,870)
Net Income (Loss)	$	198,628	$	163,955	$	343,062	$	1,286,692	$	332,904	$	(225,100)	$	10,263	$	(17,710)	$	1,848,705	$	3,941,397
Net Income (Loss)—NERA 50%	$	99,314	$	81,978	$	171,530	$	643,346	$	166,451	$	(112,550)	$	5,132	$	(8,855)				1,046,345
Net Income —NERA 40%																	$	739,482		739,482
																			$	1,785,827

Summary financial information for the year ended December 31, 2015

				Hamilton															Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			Hamilton on			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Main Apts			Park			Total
ASSETS
Rental Properties	$	8,419,054		$	2,618,666		$	6,780,019		$	4,939,620		$	573,138		$	6,174,512		$	6,352,363		$	18,574,474		$	94,250,027		$	148,681,873
Cash & Cash Equivalents		200,185			16,036			160,086			27,721			7,728			545			39,184			235,748			1,186,144			1,873,377
Rent Receivable		9,058			—			3,738			4,164			—			241			668			11,684			66,818			96,371
Real Estate Tax Escrow		33,643			—			15,322			80,196			—			51,218			40,499			81,815			210,446			513,139
Prepaid Expenses & Other Assets		104,975			565			37,088			56,048			12,879			63,345			41,201			67,496			1,898,655			2,282,252
Total Assets	$	8,766,915		$	2,635,267		$	6,996,253		$	5,107,749		$	593,745		$	6,289,861		$	6,473,915		$	18,971,217		$	97,612,090		$	153,447,012
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,865,557		$	—		$	9,916,769		$	4,728,751		$	—		$	4,497,183		$	5,208,820		$	16,760,889		$	84,680,020		$	135,657,989
Accounts Payable & Accrued Expense		69,413			1,700			63,268			28,736			12,605			14,594			55,116			216,091			792,707			1,254,230
Advance Rental Pmts& Security Deposits		202,470			—			221,871			91,649			5,799			95,552			113,084			328,675			2,482,079			3,541,179
Total Liabilities		10,137,440			1,700			10,201,908			4,849,136			18,404			4,607,329			5,377,020			17,305,655			87,954,806			140,453,398
Partners’ Capital		(1,370,525)			2,633,567			(3,205,655)			258,613			575,341			1,682,532			1,096,895			1,665,562			9,657,284			12,993,614
Total Liabilities and Capital	$	8,766,915		$	2,635,267		$	6,996,253		$	5,107,749		$	593,745		$	6,289,861		$	6,473,915		$	18,971,217		$	97,612,090		$	153,447,012
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,316,782		$	—		$	129,305		$	287,671		$	841,266		$	548,448		$	832,780		$	3,862,912			7,819,162
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(685,263)		$	—		$	(1,602,828)		$	—		$	—		$	—		$	—		$	—		$	—			(2,288,090)
																												$	5,531,072
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			48			—			48			42			148			409			786
Units to be sold		—			—			—			127			120			—			—			—			—			247
Units sold through February 1, 2015		—			—			—			127			115			—			—			—			—			242
Unsold units		—			—			—			—			5			—			—			—			—			5
Unsold units with deposits for future sale as of February 1, 2015		—			—			—			—			2			—			—			—			—			2

Summary financial information for the year ended December 31, 2015

			Hamilton						Hamilton				Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Bay		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,464,871	$	277,568	$	1,396,428	$	962,511	$	99,413	$	973,559	$	942,539	$	3,093,045	$	14,316,846	$	23,526,780
Laundry and Sundry Income		13,319		—		656		—		—		—		—		44,911		93,064		151,950
		1,478,190		277,568		1,397,084		962,511		99,413		973,559		942,539		3,137,956		14,409,910		23,678,730
Expenses
Administrative		28,849		2,000		35,071		6,262		8,105		8,592		5,402		48,818		225,509		368,608
Depreciation and Amortization		439,046		2,829		368,775		236,513		25,418		295,176		329,150		955,269		3,219,340		5,871,516
Management Fees		63,226		11,114		57,604		37,736		3,987		38,640		38,683		122,405		304,868		678,263
Operating		102,872		—		80,873		1,050		911		1,173		93,492		432,352		1,234,505		1,947,228
Renting		11,246		—		15,815		270		—		2,986		8,807		9,765		122,378		171,267
Repairs and Maintenance		153,329		200		61,183		314,409		43,559		362,861		82,769		393,665		1,134,751		2,546,726
Taxes and Insurance		216,602		52,846		124,266		166,842		20,461		154,348		124,393		341,990		1,548,439		2,750,187
		1,015,170		68,989		743,587		763,082		102,441		863,776		682,696		2,304,264		7,789,790		14,333,795
Income Before Other Income		463,020		208,579		653,497		199,429		(3,028)		109,783		259,843		833,692		6,620,120		9,344,935
Other Income (Loss)
Interest Expense		(432,732)		(46,283)		(398,414)		(281,093)		(322)		(265,636)		(308,725)		(769,579)		(4,937,726)		(7,440,510)
Interest Income		—		—				14		—		—		—		—		—		14
Other Inome		—		—		—		—		—		—		—		96		—		96
Gain on sale of real estate		—		—		—		—		169,093		—		—		—		—		169,093
		(432,732)		(46,283)		(398,414)		(281,079)		168,771		(265,636)		(308,725)		(769,483)		(4,937,726)		(7,271,307)
Net Income (Loss)	$	30,288	$	162,296	$	255,083	$	(81,651)	$	165,743	$	(155,854)	$	(48,883)	$	64,209	$	1,682,394	$	2,073,625
Net Income (Loss)—NERA 50%	$	15,144	$	81,148	$	127,543	$	(40,826)	$	82,872	$	(77,927)	$	(24,442)	$	32,105				195,617
Net Income —NERA 40%																	$	672,958		672,958
																			$	868,574

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IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

12 Months Ended

Dec. 31, 2017

IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

NOTE 15. IMPACT OF RECENTLY‑ISSUED ACCOUNTING STANDARDS

In February 2016, the FASB issued ASU 2016-02, modifying the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee.  This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively.  A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification.  Leases with a term of 12 months or less will be accounted for in the same manner as operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. The guidance supersedes previously issued guidance under ASC Topic 840 “Leases”. The guidance is effective on January 1, 2019, with early adoption permitted.  The Partnership is currently in the process of evaluating the impact the adoption of ASU 2016-02 will have on the Partnership’s consolidated financial statements.

In March 2016, the FASB issued ASU 2016-07, which eliminates a requirement for the retroactive adjustment on a step by step basis of the investment, results of operations, and retained earnings as if the equity method had been effective during all previous periods that the investment had been held when an investment qualifies for equity method accounting due to an increase in the level of ownership or degree of influence. The cost of acquiring the additional interest in the investee is to be added to the current basis of the investor’s previously held interest and the equity method of accounting should be adopted as of the date the investment becomes qualified for equity method accounting. This guidance is to be applied on a prospective basis and is effective for interim and annual periods beginning after December 15, 2016. Early adoption is permitted for financial statements that have not been previously issued. The adoption of ASU 2016-07 will have no significant impact on the Partnership’s consolidated financial statements. 

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses eight specific cash flow issues and intends to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This guidance is effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. The Partnership is currently in the process of evaluating the impact the adoption of ASU 2016-15 will have on the Partnership’s consolidated statement of cash flows.

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SALES OF REAL ESTATE

12 Months Ended

Dec. 31, 2017

SALES OF REAL ESTATE

SALES OF REAL ESTATE

NOTE 16. SALES OF REAL ESTATE

Gain on the Sale of property at Hamilton Green in 2016:
Sale price	$	1,000,000
Net book value		668,544
Expense of sale		227,013
Gain on the sale of real estate	$	104,443

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QUARTERLY FINANCIAL DATA (UNAUDITED)

12 Months Ended

Dec. 31, 2017

QUARTERLY FINANCIAL DATA (UNAUDITED)

QUARTERLY FINANCIAL DATA (UNAUDITED)

NOTE 17. QUARTERLY FINANCIAL DATA (UNAUDITED)

	Three Months Ended
	March 31, 2017		June 30, 2017		September 30, 2017		December 31, 2017		Total
Revenue	$	12,743,607	$	12,787,791	$	13,421,805	$	13,874,185	$	52,827,388
Expenses		9,001,696		8,817,160		10,493,852		10,369,714		38,682,422
Income Before Other Income and Discontinued Operations		3,741,911		3,970,631		2,927,953		3,504,471		14,144,966
Other Expenses		(1,847,677)		(1,486,924)		(2,056,233)		(1,816,201)		(7,207,035)
Net Income	$	1,894,234	$	2,483,707	$	871,720	$	1,688,270	$	6,937,931
Net Income per Unit before Discontinued Operations	$	15.23	$	19.97	$	7.01	$	13.56	$	55.77
Net Income Per Unit	$	15.23	$	19.97	$	7.01	$	13.56	$	55.77
Income Per Depositary Receipt Before Discontinued Operations	$	0.51	$	0.67	$	0.23	$	0.45	$	1.86
Net Income Per Depositary Receipt	$	0.51	$	0.67	$	0.23	$	0.45	$	1.86

	Three Months Ended
	March 31, 2016		June 30, 2016		September 30, 2016		December 31, 2016		Total
Revenue	$	12,183,288	$	12,254,264	$	12,371,881	$	12,745,657	$	49,555,090
Expenses		8,768,697		9,019,667		9,274,045		9,232,731		36,295,140
Income Before Other Income and Discontinued Operations		3,414,591		3,234,597		3,097,836		3,512,926		13,259,950
Other Expenses		(2,183,827)		(2,254,011)		(1,887,089)		(1,984,171)		(8,309,098)
Net Income	$	1,230,764	$	980,586	$	1,210,747	$	1,528,755	$	4,950,852
Net Income  per Unit before Discontinued Operations	$	9.84	$	7.85	$	9.69	$	12.24	$	39.62
Net Income  Per Unit	$	9.84	$	7.85	$	9.69	$	12.24	$	39.62
Income Per Depositary Receipt Before Discontinued Operations	$	0.33	$	0.26	$	0.32	$	0.41	$	1.32
Net Income  Per Depositary Receipt	$	0.33	$	0.26	$	0.32	$	0.41	$	1.32

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SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2017

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

NOTE 18—SUBSEQUENT EVENTS

On March 9, 2018, Hamilton Highlands, LLC (“Buyer”), a Massachusetts limited liability company whose manager is NewReal, Inc. (“New Real”), the general partner of New England Realty Associates Limited Partnership (the “Partnership”) entered into a purchase and sale agreement (the “Purchase Agreement”) with Webster Green Apartments LLC, a Massachusetts limited liability company (the “Seller”) to acquire Webster Green Apartments,  a 79 unit apartment complex located at 755-757 Highland Avenue, Needham,  Massachusetts (the “Property”), for a purchase price of $34.5 million. In connection with the execution of the Purchase Agreement, Buyer paid into escrow a deposit in the amount of $500,000 to be applied against the purchase price at the closing of the purchase of the Property. The Buyer expects to assume a $21.5 million mortgage currently outstanding on the Property, with the balance of the purchase price to be paid from the Partnership’s cash reserves and line of credit. The Buyer’s sole member is New England Realty Associates Limited Partnership.

The closing of the acquisition of the Property is subject to numerous customary undertakings, covenants, obligations and conditions and is expected to be completed on or before March 31, 2018.

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QUALIFYING ACCOUNTS

12 Months Ended

Dec. 31, 2017

QUALIFYING ACCOUNTS

QUALIFYING ACCOUNTS

NOTE 19—QUALIFYING ACCOUNTS

New England Realty Associates Limited Partnership

Valuation and Qualifying Accounts

		Additions
	Balance at	Charged to	Charged to		Balance
	Beginning	Costs and	other account	Deductions	at end
Description	of Period	Expenses	describe	Describe(a)	of Period
Year Ended December 31, 2017:
Deducted from asset accounts:
Allowance for doubtful accounts	523,004	422,109		301,123	643,990
Year Ended December 31, 2016:
Deducted from asset accounts:
Allowance for doubtful accounts	372,828	365,746		215,570	523,004
Year Ended December 31, 2015:
Deducted from asset accounts:
Allowance for doubtful accounts	366,105	201,622		194,899	372,828

(a) Uncollectible accounts written off

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2017

SIGNIFICANT ACCOUNTING POLICIES

Line of Business

Line of Business:  New England Realty Associates Limited Partnership (“NERA” or the “Partnership”) was organized in Massachusetts in 1977. NERA and its subsidiaries own 26 properties which include 18 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,632 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a  40-50% interest in 9 residential and mixed use properties consisting of 722 apartment units, 12,500 square feet of commercial space and a 50 car parking lot. The properties are located in Eastern Massachusetts and Southern New Hampshire.

Basis of Presentation

Basis of Presentation: The financial statements have been prepared in conformity with GAAP. The preparation  of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. These estimates and assumptions are based on management’s historical experience that are believed to be reasonable at the time. However, because future events and their effects cannot be determined with certainty, the determination of estimates requires the exercise of judgement. The Partnership’s critical accounting policies are those which require assumptions to be made about matters that are highly uncertain. Different estimates could have a material effect on the Partnership’s financial results. Judgements and uncertainties affecting the application of these policies and estimates may result in materially different amounts being reported under different conditions and circumstances.

Principles of Consolidation

Principles of Consolidation:  The consolidated financial statements include the accounts of NERA and its subsidiaries. NERA has a 99.67% to 100% ownership interest in each subsidiary except for the nine limited liability companies (the “Investment Properties” or “Joint Ventures”) in which the Partnership has a 40 ‑ 50% ownership interest. The consolidated group is referred to as the “Partnership”. Minority interests are not recorded, since they are insignificant. All significant intercompany accounts and transactions are eliminated in consolidation. The Partnership accounts for its investment in the above‑mentioned Investment Properties using the equity method of consolidation. (See Note 14: Investments in Unconsolidated Joint Ventures).

The Partnership accounts for its investments in joint ventures using the equity method of accounting. These investments are recorded initially at cost, as Investments in Unconsolidated Joint Ventures, and subsequently adjusted for equity in earnings and cash contributions and distributions. Generally, the Partnership would discontinue applying the equity method when the investment (and any advances) is reduced to zero and would not provide for additional losses unless the Partnership has guaranteed obligations of the venture or is otherwise committed to providing further financial support for the investee. If the investment subsequently generates income, the Partnership only recognizes its share of such income to the extent it exceeds its share of previously unrecognized losses. In 2013 and beyond, the carrying values of  certain  investments fell below zero. We intend to fund our share of the investments’ future operating deficits should the need arise. However, we have no legal obligation to pay for any of the liabilities of such investments nor do we have any legal obligation to fund operating deficits. (See Note 14: Investment in Unconsolidated Joint Ventures.)

The authoritative guidance on consolidation provides guidance on the identification of entities for which control is achieved through means other than voting rights (“variable interest entities” or “VIEs”) and the determination of which business enterprise, if any, should consolidate the VIE (the “primary beneficiary”). Generally, the consideration of whether an entity is a VIE applies when either (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest, (2) the equity investment at risk is insufficient to finance that equity’s activities without additional subordinated financial support or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The primary beneficiary is defined by the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the variable interest entity’s performance; and (2) the obligation to absorb losses and rights to receive the returns from VIE that would be significant to the VIE.

Impairment

Impairment:  On an annual basis management assesses whether there are any indicators that the value of the Partnership’s rental properties or investments in unconsolidated subsidiaries may be impaired. In addition to identifying   any specific circumstances which may affect a property or properties, management considers other criteria for determining which properties may require assessment for potential impairment. The criteria considered by management include reviewing low leased percentages, significant near term lease expirations, recently acquired properties, current and historical operating and/or cash flow losses, near term mortgage debt maturities or other factors that might impact the Partnership’s intent and ability to hold property. A property’s value is impaired only if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, the loss shall be measured as the excess of the carrying amount of the property over the fair value of the property. The Partnership’s estimates of aggregate future cash flows expected to be generated by each property are based on a number of assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for tenants, changes in market rental rates, and costs to operate each property. As these factors are difficult to predict and are subject to future events that may alter management’s assumptions, the future cash flows estimated by management in its impairment analyses may not be achieved.

Revenue Recognition

Revenue Recognition:  Rental income from residential and commercial properties is recognized over the term of the related lease. For residential tenants, amounts 60 days in arrears are charged against income. The commercial tenants are evaluated on a case by case basis. Certain leases of the commercial properties provide for increasing stepped minimum rents, which are accounted for on a straight‑line basis over the term of the lease. Contingent rent for commercial properties are received from tenants for certain costs as provided in the lease agreement. The costs generally include real estate taxes, utilities, insurance, common area maintenance and recoverable costs. Rental concessions are also accounted for on the straight‑line basis.

Above‑market and below‑market lease values for acquired properties are initially recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the differences between (i) the contractual amounts to be paid pursuant to each in‑place lease and (ii) management’s estimate of fair market lease rates for each corresponding in‑place lease, measured over a period equal to the remaining term of the lease for above‑market leases and the initial term plus the term of any below‑market fixed‑rate renewal options for below‑market leases. The capitalized above‑market lease values for acquired properties are amortized as a reduction of base rental revenue over the remaining term of the respective leases, and the capitalized below‑market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below‑market fixed‑rate renewal options of the respective leases.

Rental Properties

Rental Properties:  Rental properties are stated at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred; improvements and additions which improve or extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost of the asset and related accumulated depreciation is eliminated from the accounts, and any gain or loss on such disposition is included in income. Fully depreciated assets are removed from the accounts. Rental properties are depreciated by both straight‑line and accelerated methods over their estimated useful lives. Upon acquisition of rental property, the Partnership estimates the fair value of acquired tangible assets, consisting of land, building and improvements, and identified intangible assets and liabilities assumed, generally consisting of the fair value of (i) above and below market leases, (ii) in‑place leases and (iii) tenant relationships. The Partnership allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. The Partnership records goodwill or a gain on bargain purchase (if any) if the net assets acquired/liabilities assumed exceed the purchase consideration of a transaction. In estimating the fair value of the tangible and intangible assets acquired, the Partnership considers information obtained about each property as a result of its due diligence and marketing and leasing activities, and utilizes various valuation methods, such as estimated cash flow projections utilizing appropriate discount and capitalization rates, estimates of replacement costs net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant.

Other intangible assets acquired include amounts for in‑place lease values and tenant relationship values, which are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Partnership’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in‑place lease values include an estimate of carrying costs during hypothetical expected lease‑up periods considering current market conditions, and costs to execute similar leases at market rates during the expected lease‑up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. Characteristics considered by management in valuing tenant relationships include the nature and extent of the Partnership’s existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of in‑place leases are amortized to expense over the remaining initial terms of the respective leases. The value of tenant relationship intangibles are amortized to expense over the anticipated life of the relationships.

In the event that facts and circumstances indicate that the carrying value of a rental property may be impaired, an analysis of the value is prepared. The estimated future undiscounted cash flows are compared to the asset’s carrying value to determine if a write‑down to fair value is required.

Leasing Fees and Deferred Financing Costs

Leasing Fees: Leasing fees are capitalized and amortized on a straight‑line basis over the life of the related lease. Unamortized balances are expensed when the corresponding fee is no longer applicable.

Deferred Financing Costs:  Costs incurred in obtaining financing are capitalized and amortized over the term of the related indebtedness. Deferred financing costs are presented in the balance sheet as a direct deduction from the carrying value of the debt liability to which they relate, except deferred financing costs related to the revolving credit facility, which are presented in prepaid expenses and other assets. In all cases, amortization of such costs is included in interest expense and was approximately $193,000,  $188,000 and $171,000 for the years ended December 31, 2017, 2016 and 2015 respectively.

Income Taxes

Income Taxes:  The financial statements have been prepared on the basis that NERA and its subsidiaries are entitled to tax treatment as partnerships. Accordingly, no provision for income taxes have been recorded (See Note 13).

Cash Equivalents

Cash Equivalents:  The Partnership considers cash equivalents to be all highly liquid instruments purchased with a maturity of three months or less.

Segment Reporting

Segment Reporting:  Operating segments are revenue producing components of the Partnership for which separate financial information is produced internally for management. Under the definition, NERA operated, for all periods presented, as one segment.

Comprehensive Income

Comprehensive Income:  Comprehensive income is defined as changes in partners’ equity, exclusive of transactions with owners (such as capital contributions and dividends). NERA did not have any comprehensive income items in 2017, 2016, or 2015 other than net income as reported.

Income (Loss) Per Depositary Receipt

Income (Loss) Per Depositary Receipt:  Effective January 3, 2012, the Partnership authorized a 3‑for‑1 forward split of its Depositary Receipts listed on the NYSE Amex and a concurrent adjustment of the exchange ratio of Depositary Receipts for Class A Units of the Partnership from 10‑to‑1 to 30‑to‑1, such that each Depositary Receipt represents one‑thirtieth (1/₃₀) of a Class A Unit of the Partnership. All references to Depositary Receipts in the report are reflective of the 3‑ for‑1 forward split.

Income Per Unit

Income Per Unit:  Net income per unit has been calculated based upon the weighted average number of units outstanding during each period presented. The Partnership has no dilutive units and, therefore, basic net income is the same as diluted net income per unit (see Note 7). 

Concentration of Credit Risks and Financial Instruments

Concentration of Credit Risks and Financial Instruments:  The Partnership’s properties are located in New England, and the Partnership is subject to the general economic risks related thereto. No single tenant accounted for more than 5% of the Partnership’s revenues in 2017, 2016, or 2015. The Partnership makes its temporary cash investments with high‑credit quality financial institutions. At December 31, 2017, substantially all of the Partnership’s cash and cash equivalents were held in interest‑bearing accounts at financial institutions, earning interest at rates from 0.01% to 0.20%. At December 31, 2017 and 2016, respectively approximately $8,898,000 and $8,911,000 of cash and cash equivalents, and security deposits included in prepaid expenses and other assets exceeded federally insured amounts.

Advertising Expense

Advertising Expense:  Advertising is expensed as incurred. Advertising expense was $201,040,  $191,815 and $165,070 in 2017, 2016 and 2015, respectively.

Rental Property Held for Sale

RentalPropertyHeld  for sale:When assets are identified by management as held for sale, the Partnership discontinues depreciating the assets and estimates the sales price, net of selling costs, of such assets. The Partnership generally considers assets to be held for sale when the transaction has received appropriate corporate authority, and there are no significant contingencies relating to the sale. If, in management’s opinion, the estimated net sales price, net of selling costs, of the assets which have been identified as held for sale is less than the carrying value of the assets, a valuation allowance is established.

If circumstances arise that previously were considered unlikely and, as a result, the Partnership decides not to sell a property previously classified as held for sale, the property is reclassified as held and used. A property that is reclassified is measured and recorded individually at the lower of (a) its carrying value before the property was classified as held for sale, adjusted for any depreciation (amortization) expense that would have been recognized had the property been continuously classified as held and used, or (b) the fair value at the date of the subsequent decision not to sell.

Interest Capitalized

Interest Capitalized:  The Partnership follows the policy of capitalizing interest as a component of the cost of rental property when the time of construction exceeds one year. During the years ended December 31, 2017,  2016 and 2015 there was no capitalized interest.

Extinguishment of Debt

Extinguishment of Debt:  When existing mortgages are refinanced with the same lender and it is determined that the refinancing is substantially different then they are recorded as an extinguishment of debt. However if it is determined that the refinancing is substantially the same then they are recorded as an exchange of debt. All refinancing qualify as extinguishment of debt.

Reclassifications

Reclassifications:  Certain reclassifications have been made to prior period amounts in order to conform to current period presentation. The reclassifications were related primarily to conform to ASU No. 2015-03, Simplifying thePresentation of Debt Issuance Costs, Amortization of deferred financing costs of approximately $171,000 was reclassified as interest expense for the year ended December 31, 2015. There was no change to the net income for any period presented as a result of these reclassifications.

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RENTAL PROPERTIES (Tables)

12 Months Ended

Dec. 31, 2017

RENTAL PROPERTIES

Schedule of rental properties

	December 31, 2017		December 31, 2016		Useful Life
Land, improvements and parking lots	$	65,087,214	$	52,612,929	15	-	40	years
Buildings and improvements		201,844,565		173,536,288	15	-	40	years
Kitchen cabinets		12,338,627		8,738,323	5	-	10	years
Carpets		8,802,831		7,621,292	5	-	10	years
Air conditioning		641,079		690,535	5	-	10	years
Laundry equipment		263,275		269,784	5	-	7	years
Elevators		1,139,296		1,139,296	20	-	40	years
Swimming pools		444,629		444,629	10	-	30	years
Equipment		11,163,864		10,029,639	5	-	30	years
Motor vehicles		216,260		237,954			5	years
Fences		37,465		37,465	5	-	15	years
Furniture and fixtures		9,390,021		8,127,100	5	-	7	years
Smoke alarms		582,471		174,059	5	-	7	years
Total fixed assets		311,951,597		263,659,293
Less: Accumulated depreciation		(104,797,803)		(94,196,482)
	$	207,153,794	$	169,462,811

Schedule of real estate and accumulated depreciation

							Cost
			Initial Cost to				Capitalized		Gross Amount at Which								Years
Property Name	Encumbrances		Partnerships(1)				Subsequent to		Carried at Close of Period								Built/	Depreciable
Type	(First				Buildings		Acquisition(2)				Buildings				Accumulated		Redecorated	Lives
Location	Mortgages)		Land		Improvements		Improvements		Land		Improvements		Totals		Depreciation		Date Acquired	Years
Boylston Downtown L.P. Residential Apartments Boston, Massachusetts	$	39,049,572	$	2,112,000	$	8,593,109	$	8,836,077	$	2,112,000	$	17,429,186	$	19,541,186	$	11,977,004	July 1995	(3)
Brookside Associates LLC Residential Apartments Woburn, Massachusetts	$	2,501,972	$	684,000	$	3,116,000	$	432,022	$	684,000	$	3,548,022	$	4,232,022	$	2,174,123	Oct. 2000	(3)
Clovelly Apartments L.P. Residential Apartments Nashua, New Hampshire	$	4,160,000	$	177,610	$	1,478,359	$	1,701,168	$	177,610	$	3,179,527	$	3,357,137	$	2,250,924	Sept. 1977	(3)
Commonwealth 1137 L.P. Residential Apartments Boston, Massachusetts	$	3,750,000	$	342,000	$	1,367,669	$	1,196,072	$	342,000	$	2,563,741	$	2,905,741	$	1,765,386	July 1995	(3)
Commonwealth 1144 L.P. Residential Apartments Boston, Massachusetts	$	14,780,000	$	1,410,000	$	5,664,816	$	3,924,962	$	1,410,000	$	9,589,778	$	10,999,778	$	5,954,341	July 1995	(3)
Executive Apartments L.P. Residential Apartments Framingham, Massachusetts	$	2,415,000	$	91,400	$	740,360	$	1,286,060	$	91,400	$	2,026,420	$	2,117,820	$	1,225,043	Sept. 1977	(3)
Hamilton Battle Green LLC Residential Apartments Lexington, Massachusetts	$	4,460,057	$	1,341,737	$	8,457,497	$	159,257	$	1,341,737	$	8,616,754	$	9,958,491	$	2,314,831	Jun. 2011	(3)
Hamilton Cypress LLC Commercial - 1031 Exchange Brookline, Massachusetts	$	—	$	2,362,596	$	4,613,985	$	249,024	$	2,362,596	$	4,863,009	$	7,225,605	$	1,470,530	Oct. 2008	(3)
Hamilton Green Apartments, LLC Residential Apartments Andover, Massachusetts	$	36,555,470	$	16,054,336	$	44,794,438	$	581,025	$	16,054,336	$	45,375,463	$	61,429,799	$	15,460,634	Jul. 2013	(3)
Hamilton Linewt LLC Commercial - 1031 Exchange Newton, Massachusetts	$	—	$	884,042	$	2,652,127	$	138,904	$	884,042	$	2,791,031	$	3,675,073	$	706,988	Nov. 2007	(3)
Hamilton Oaks Associates LLC Residential Apartments Brockton, Massachusetts	$	11,925,000	$	2,175,000	$	12,325,000	$	3,281,817	$	2,175,000	$	15,606,817	$	17,781,817	$	9,876,116	Dec. 1999	(3)
Highland Street Apartments, L.P. Residential Apartments Lowell, Massachusetts	$	1,050,000	$	156,000	$	634,085	$	274,024	$	156,000	$	908,109	$	1,064,109	$	647,937	Dec. 1996	(3)
Linhart L.P.  Residential / Commercial Newton, Massachusetts	$	—	$	385,000	$	1,540,000	$	1,585,649	$	385,000	$	3,125,649	$	3,510,649	$	2,245,989	Jan. 1995	(3)
NERA Dean St. Associates LLC Residential Apartments Norwood, Massachusetts	$	5,687,000	$	1,512,000	$	5,701,480	$	1,086,013	$	1,512,000	$	6,787,493	$	8,299,493	$	3,702,802	Jun. 2002	(3)
North Beacon 140 L.P. Residential Apartments Boston, Massachusetts	$	6,937,000	$	936,000	$	3,762,013	$	2,350,856	$	936,000	$	6,112,869	$	7,048,869	$	4,279,547	July 1995	(3)
Olde English Apartments L.P. Residential Apartments Lowell, Massachusetts	$	3,080,000	$	46,181	$	878,323	$	1,026,852	$	46,181	$	1,905,175	$	1,951,356	$	1,289,709	Sept. 1977	(3)
Redwood Hills L.P. Residential Apartments Worcester, Massachusetts	$	6,743,000	$	1,200,000	$	4,810,604	$	3,946,412	$	1,200,000	$	8,757,016	$	9,957,016	$	5,547,278	July 1995	(3)
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts	$	20,071,000	$	6,247,153	$	24,954,777	$	825,028	$	6,247,153	$	25,779,805	$	32,026,958	$	3,149,707	Sept. 2015	(3)
River Drive L.P. Residential Apartments Danvers, Massachusetts	$	3,465,000	$	72,525	$	587,777	$	1,033,453	$	72,525	$	1,621,230	$	1,693,755	$	840,124	Sept. 1977	(3)
Riverside Apartments Condominium Units Massachusetts	$	—	$	23,346	$	190,807	$	77,051	$	23,346	$	267,858	$	291,204	$	223,822	Sept. 1977	(3)
School St Assoc LLC Residential Apartments Framingham, Massachusetts	$	14,549,604	$	4,686,728	$	18,746,911	$	(346,294)	$	4,686,728	$	18,400,617	$	23,087,345	$	9,487,028	Apr. 2003	(3)
WRF Associates LLC Strip Mall Framingham, Massachusetts	$	6,000,000	$	3,280,000	$	4,920,000	$	82,460	$	3,280,000	$	5,002,460	$	8,282,460	$	3,070,591	May 1999	(3)
WCB Associates LLC Residential Apartments Brockton, Massachusetts	$	7,000,000	$	1,335,000	$	7,565,501	$	2,342,341	$	1,335,000	$	9,907,842	$	11,242,842	$	6,109,227	Dec. 1999	(3)
Westate Apartments Burlington LLC Residential Apartments Burlington, Massachusetts	$	2,500,000	$	44,965	$	4,478,687	$	225,772	$	44,965	$	4,704,459	$	4,749,424	$	2,325,390	Sept. 2004	(3)
Westgate Apartments LLC Residential Apartments Woburn, Massachusetts	$	15,700,000	$	461,300	$	2,424,636	$	7,149,052	$	417,107	$	9,573,688	$	9,990,795	$	5,681,385	Sept. 1977	(3)
Woodland Park Apartments LLC
Newton, Massachusetts	$	22,250,000	$	9,114,334	$	35,874,994	$	541,522	$	9,114,334	$	36,416,516	$	45,530,850	$	1,021,349	July 2017	(3)
	$	234,629,675	$	57,135,253	$	210,873,955	$	43,986,579	$	57,091,060	$	254,860,534	$	311,951,597	$	104,797,803

(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.

(3) In 2017, rental properties were depreciated over the following estimated useful lives:

Assets	Life
Buildings and Improvements	10	-	40	years
Other Categories of Assets	5	-	15	years

Schedule of reconciliation of rental properties and accumulated depreciation

	December 31,
	2017		2016		2015
Rental Properties
Balance, Beginning	$	263,659,293	$	261,276,898	$	225,021,946
Additions:
Buildings, improvements and other assets		50,784,476		5,163,081		37,895,926
		314,443,769		266,439,979		262,917,872
Deduct:
Write-offs of retired or disposed assets		2,492,172		2,112,142		1,640,974
Rental properties held for sale and/or sold				668,544		—
Balance, Ending	$	311,951,597	$	263,659,293	$	261,276,898
Accumulated Depreciation
Balance, Beginning	$	94,196,482	$	84,579,584	$	75,905,862
Add:
Depreciation for the year		13,093,493		11,729,039		10,314,696
		107,289,975		96,308,623		86,220,558
Deduct
Accumulated depreciation of retired or disposed assets		2,492,172		2,112,141		1,640,974
Balance, Ending	$	104,797,803	$	94,196,482	$	84,579,584

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MORTGAGE NOTES PAYABLE (Tables)

12 Months Ended

Dec. 31, 2017

MORTGAGE NOTES PAYABLE

Schedule of approximate annual maturities

Approximate annual maturities at December 31, 2017 are as follows:

2018—current maturities	$	7,843,000
2019		1,923,000
2020		4,331,000
2021		2,449,000
2022		2,686,000
Thereafter		215,397,000
		234,629,000
Less: unamortized deferred financing costs		1,408,000
	$	233,221,000

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PARTNERS' CAPITAL (Tables)

12 Months Ended

Dec. 31, 2017

PARTNERS' CAPITAL

Schedule of information per depositary receipt

	Year Ended
	December 31,
	2017		2016
Net Income per Depositary Receipt	$	1.86	$	1.32
Distributions per Depositary Receipt	$	2.15	$	1.80

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TREASURY UNITS (Tables)

12 Months Ended

Dec. 31, 2017

TREASURY UNITS

Schedule of treasury units

Class A	44,671
Class B	10,609
General Partnership	559
	55,839

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RENTAL INCOME (Tables)

12 Months Ended

Dec. 31, 2017

RENTAL INCOME

Schedule of minimum future annual rental income on non-cancellable operating leases

Approximately 7% was related to commercial properties, which have minimum future annual rental income on non‑cancellable operating leases at December 31, 2017 as follows:

	Commercial
	Property Leases
2018	$	2,623,000
2019		2,131,000
2020		1,767,000
2021		1,325,000
2022		565,000
Thereafter		1,159,000
	$	9,570,000

Schedule of information for commercial leases

	Annual base				Percentage of
	rent for		Total square feet	Total number of	annual base rent for
Through December 31,	expiring leases		for expiring leases	leases expiring	expiring leases
2018	$	499,878	19,724	14	17	%
2019		576,710	20,838	11	19	%
2020		185,494	4,461	6	6	%
2021		829,156	40,323	6	29	%
2022		486,772	12,218	6	16	%
2023		157,443	4,771	1	5	%
2024		94,184	1,858	1	3	%
2025		—	—	—	0	%
2026		—	—	—	0	%
2027		—	—	—	0	%
2028		—	—	—	0	%
2029		142,450	3,850	1	5	%
Totals	$	2,972,087	108,043	46	100	%

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FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2017

FAIR VALUE MEASUREMENTS

Schedule of carrying amounts and estimated fair value of debt

		Carrying Amount		Estimated Fair Value
Mortgage Notes Payable
Partnership Properties
At December 31, 2017	*	$	233,221,258	$	237,895,708
At December 31, 2016	*	$	212,709,080	$	219,086,450
Investment Properties
At December 31, 2017	*	$	124,145,012	$	125,519,974
At December 31, 2016	*	$	130,152,297	$	133,991,269

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TAXABLE INCOME AND TAX BASIS (Tables)

12 Months Ended

Dec. 31, 2017

TAXABLE INCOME AND TAX BASIS

Schedule of reconciliation of GAAP net income to taxable income

	For the year ended
	December 31,
	2017		2016		2015
	(in thousands)
Financial statement (“book”) net income	$	6,938	$	4,951	$	3,773
Book/Tax differences from depreciation and amortization		(3,097)		(1,411)		(2,513)
Book/Tax differences on tax free exchanges		1,344		1,257		501
Book/Tax differences from Investment Properties		—		(279)		(74)
Increase (Decrease) in prepaid rent and allowances		253		375		413
Other		—		—		6
Taxable income (loss)	$	5,438	$	4,893	$	2,106

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Tables)

12 Months Ended

Dec. 31, 2017

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

Summary of financial position relating to investment in unconsolidated joint ventures

Summary financial information as of December 31, 2017

				Hamilton															Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,615,554		$	2,598,297		$	6,325,676		$	—		$	—		$	—		$	5,870,833		$	17,568,730		$	89,746,236		$	129,725,326
Assets Held for sales		—			—			—			1,670,652			—			2,365,620			—			—			—			4,036,272
Cash & Cash Equivalents		293,801			46,076			105,074			86,495			—			448,952			88,436			145,149			969,064			2,183,047
Rent Receivable		21,478			—			9,057			7,129			—			9,199			2,121			14,879			152,759			216,622
Real Estate Tax Escrow		95,544			—			18,171			—			—			—			28,519			183,649			316,132			642,015
Prepaid Expenses & Other Assets		77,490			697			53,813			362,044			—			315,996			25,703			71,449			1,291,561			2,198,753
Total Assets	$	8,103,867		$	2,645,070		$	6,511,791		$	2,126,320		$	—		$	3,139,767		$	6,015,612		$	17,983,856		$	92,475,752		$	139,002,035
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,893,135		$	—		$	9,672,846		$	—		$	—		$	—		$	5,887,818		$	16,792,991		$	81,898,222		$	124,145,012
Accounts Payable & Accrued Expense		57,811			1,700			56,417			11,151			—			23,049			49,540			137,282			750,666			1,087,616
Advance Rental Pmts & Security Deposits		313,218			—			234,870			11,649			—			19,365			76,426			361,677			2,469,208			3,486,413
Total Liabilities		10,264,164			1,700			9,964,133			22,800			—			42,414			6,013,784			17,291,950			85,118,096			128,719,041
Partners’ Capital		(2,160,297)			2,643,370			(3,452,342)			2,103,520			—			3,097,353			1,828			691,906			7,357,656			10,282,994
Total Liabilities and Capital	$	8,103,867		$	2,645,070		$	6,511,791		$	2,126,320		$	—		$	3,139,767		$	6,015,612		$	17,983,856		$	92,475,752		$	139,002,035
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,321,684		$	—		$	1,051,759		$	—		$	1,548,676		$	913		$	345,952		$	2,943,060			7,212,044
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,080,148)		$	—		$	(1,726,171)		$	—		$	—		$	—		$	—		$	—		$	—			(2,806,319)
Total Investment in Unconsolidated Joint Ventures (Net)																												$	4,405,725
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			—			—			—			42			148			409			689
Units to be sold		—			—			—			176			120			48			—			—			—			344
Units sold through February 1, 2018		—			—			—			159			120			31			—			—			—			310
Unsold units		—			—			—			17			—			17			—			—			—			34
Unsold units with deposits for future sale as of  February 1, 2018		—			—			—			7			—			4			—			—			—			11

Summary financial information as of December 31, 2016

				Hamilton															Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	8,011,942		$	2,622,011		$	6,587,662		$	3,706,705		$	140,635		$	5,929,749		$	6,165,266		$	17,773,858		$	91,943,516		$	142,881,344
Cash & Cash Equivalents		167,953			52,321			57,635			144,831			18,576			923			47,795			95,294			1,496,250			2,081,578
Rent Receivable		25,604			—			9,840			10,568			2,452			5,520			—			6,133			204,956			265,073
Real Estate Tax Escrow		127,728			—			18,570			—			0			47,308			18,198			189,239			211,494			612,537
Prepaid Expenses & Other Assets		96,307			615			50,553			403,514			1,540			79,474			26,473			75,324			1,627,342			2,361,142
Total Assets	$	8,429,534		$	2,674,947		$	6,724,260		$	4,265,618		$	163,203		$	6,062,974		$	6,257,732		$	18,139,848		$	95,483,558		$	148,201,674
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,879,346		$	—		$	9,849,225		$	—		$	—		$	4,430,574		$	5,879,634		$	16,776,940		$	83,336,579		$	130,152,298
Accounts Payable & Accrued Expense		59,227			1,700			65,948			9,432			3,137			12,277			50,643			157,812			673,585			1,033,761
Advance Rental Pmts& Security Deposits		218,582			—			236,679			61,883			1,822			82,693			120,096			347,446			2,667,408			3,736,609
Total Liabilities		10,157,155			1,700			10,151,852			71,315			4,959			4,525,544			6,050,373			17,282,198			86,677,572			134,922,668
Partners’ Capital		(1,727,621)			2,673,247			(3,427,592)			4,194,303			158,244			1,537,430			207,359			857,650			8,805,986			13,279,006
Total Liabilities and Capital	$	8,429,534		$	2,674,947		$	6,724,260		$	4,265,618		$	163,203		$	6,062,974		$	6,257,732		$	18,139,848		$	95,483,558		$	148,201,674
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,336,623		$	—		$	2,097,151		$	79,122		$	768,714		$	103,679		$	428,824		$	3,522,393		$	8,336,505
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(863,810)		$	—		$	(1,713,796)		$	—		$	—		$	—		$	—		$	—		$	—			(2,577,606)
Total Investment in Unconsolidated Joint Ventures (Net)																												$	5,758,899
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			0			—			0			42			148			409			689
Units to be sold		—			—			—			176			120			48			—			—			—			344
Units sold through February 1, 2016		—			—			—			139			119			—			—			—			—			258
Unsold units		—			—			—			37			1			—			—			—			—			38
Unsold units with deposits for future sale as of February 1, 2016		—			—			—			5			1			—			—			—			—			6

Summary financial information as of December 31, 2015

				Hamilton															Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Hamilton			Minuteman			Hamilton on			Dexter
	Essex 81			Development			Franklin			1025			Bay Sales			Bay Apts			Apts			Main Apts			Park			Total
ASSETS
Rental Properties	$	8,419,054		$	2,618,666		$	6,780,019		$	4,939,620		$	573,138		$	6,174,512		$	6,352,363		$	18,574,474		$	94,250,027		$	148,681,873
Cash & Cash Equivalents		200,185			16,036			160,086			27,721			7,728			545			39,184			235,748			1,186,144			1,873,377
Rent Receivable		9,058			—			3,738			4,164			—			241			668			11,684			66,818			96,371
Real Estate Tax Escrow		33,643			—			15,322			80,196			—			51,218			40,499			81,815			210,446			513,139
Prepaid Expenses & Other Assets		104,975			565			37,088			56,048			12,879			63,345			41,201			67,496			1,898,655			2,282,252
Total Assets	$	8,766,915		$	2,635,267		$	6,996,253		$	5,107,749		$	593,745		$	6,289,861		$	6,473,915		$	18,971,217		$	97,612,090		$	153,447,012
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,865,557		$	—		$	9,916,769		$	4,728,751		$	—		$	4,497,183		$	5,208,820		$	16,760,889		$	84,680,020		$	135,657,989
Accounts Payable & Accrued Expense		69,413			1,700			63,268			28,736			12,605			14,594			55,116			216,091			792,707			1,254,230
Advance Rental Pmts& Security Deposits		202,470			—			221,871			91,649			5,799			95,552			113,084			328,675			2,482,079			3,541,179
Total Liabilities		10,137,440			1,700			10,201,908			4,849,136			18,404			4,607,329			5,377,020			17,305,655			87,954,806			140,453,398
Partners’ Capital		(1,370,525)			2,633,567			(3,205,655)			258,613			575,341			1,682,532			1,096,895			1,665,562			9,657,284			12,993,614
Total Liabilities and Capital	$	8,766,915		$	2,635,267		$	6,996,253		$	5,107,749		$	593,745		$	6,289,861		$	6,473,915		$	18,971,217		$	97,612,090		$	153,447,012
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,316,782		$	—		$	129,305		$	287,671		$	841,266		$	548,448		$	832,780		$	3,862,912			7,819,162
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(685,263)		$	—		$	(1,602,828)		$	—		$	—		$	—		$	—		$	—		$	—			(2,288,090)
																												$	5,531,072
Total units/condominiums
Apartments		48			—			40			175			120			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			—			3
Total		49			1			40			176			120			48			42			148			409			1,033
Units to be retained		49			1			40			48			—			48			42			148			409			786
Units to be sold		—			—			—			127			120			—			—			—			—			247
Units sold through February 1, 2015		—			—			—			127			115			—			—			—			—			242
Unsold units		—			—			—			—			5			—			—			—			—			5
Unsold units with deposits for future sale as of February 1, 2015		—			—			—			—			2			—			—			—			—			2

Summary of income statement relating to investment in unconsolidated joint ventures

Summary financial information for the year ended December 31, 2017

			Hamilton										Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,404,006	$	227,856	$	1,473,098	$	352,888	$	5,557	$	544,482	$	1,024,570	$	3,359,971	$	14,983,834	$	23,376,262
Laundry and Sundry Income		15,424		—		5,380		—		—		—		2,620		37,968		101,131		162,523
		1,419,430		227,856		1,478,478		352,888		5,557		544,482		1,027,190		3,397,939		15,084,965		23,538,785
Expenses
Administrative		26,760		26,065		25,686		4,142		6,326		8,617		5,671		33,688		179,614		316,569
Depreciation and Amortization		456,728		2,830		348,502		82,383		81,655		181,152		349,910		1,005,595		3,376,142		5,884,897
Management Fees		59,873		9,114		61,513		13,056		253		19,947		39,976		133,138		323,136		660,006
Operating		70,847		—		70,599		458		38		4,239		87,284		360,706		1,146,768		1,740,939
Renting		37,474		—		36,194		392		181		241		7,992		36,767		282,022		401,263
Repairs and Maintenance		188,763		3,668		109,039		227,346		3,326		303,174		81,647		606,570		1,435,579		2,959,112
Taxes and Insurance		239,875		58,538		138,503		99,646		1,850		140,904		127,947		436,266		1,719,536		2,963,065
		1,080,320		100,215		790,036		427,423		93,629		658,274		700,427		2,612,730		8,462,797		14,925,851
Income Before Other Income		339,110		127,641		688,442		(74,535)		(88,072)		(113,792)		326,763		785,209		6,622,168		8,612,934
Other Income (Loss)
Interest Expense		(349,303)		—		(393,193)		(1,010)		(2)		(41,957)		(237,293)		(770,953)		(4,780,498)		(6,574,209)
Interest Income		—		—		—		—		—		—		—		—		—		—
Gain on Sale of Real Estate		—		—		—		2,379,763		133,297		3,628,205		—		—		—		6,141,265
		(349,303)		—		(393,193)		2,378,753		133,295		3,586,248		(237,293)		(770,953)		(4,780,498)		(432,944)
Net Income (Loss)	$	(10,193)	$	127,641	$	295,249	$	2,304,218	$	45,223	$	3,472,456	$	89,470	$	14,256	$	1,841,670	$	8,179,990
Net Income (Loss)—NERA 50%	$	(5,097)	$	63,821	$	147,625	$	1,152,109	$	22,612	$	1,736,228	$	44,735	$	7,127				3,169,159
Net Income —NERA 40%																	$	736,668		736,668
																			$	3,905,827

Summary financial information for the year ended December 31, 2016

													Hamilton		Hamilton
	Hamilton		Hamilton Essex		345		Hamilton		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,534,910	$	240,000	$	1,471,455	$	798,710	$	40,290	$	969,220	$	992,980	$	3,236,490	$	14,731,240	$	24,015,295
Laundry and Sundry Income		15,263		—		4,707		—		—		—		1,326		40,720		108,711		170,727
		1,550,173		240,000		1,476,162		798,710		40,290		969,220		994,306		3,277,210		14,839,951		24,186,022
Expenses
Administrative		31,400		1,740		34,512		9,636		6,295		10,768		6,557		48,753		187,176		336,837
Depreciation and Amortization		452,186		2,830		348,169		184,898		4,921		298,503		341,645		961,390		3,261,594		5,856,136
Management Fees		63,880		9,600		60,545		30,493		1,745		38,258		40,648		129,134		317,947		692,250
Operating		103,761		—		72,280		919		315		2,358		96,690		328,915		1,165,589		1,770,827
Renting		26,731		—		22,395		1,789		—		4,354		6,202		19,354		250,675		331,500
Repairs and Maintenance		157,398		3,150		66,606		296,423		22,054		413,972		84,307		558,988		1,391,171		2,994,069
Taxes and Insurance		227,148		58,725		130,867		161,984		9,236		164,667		121,365		476,185		1,541,959		2,892,136
		1,062,504		76,045		735,374		686,142		44,566		932,880		697,414		2,522,719		8,116,111		14,873,755
Income Before Other Income		487,669		163,955		740,788		112,568		(4,276)		36,340		296,892		754,491		6,723,840		9,312,267
Other Income (Loss)
Interest Expense		(289,041)		—		(397,726)		(150,061)		(71)		(261,440)		(286,628)		(772,201)		(4,875,137)		(7,032,305)
Interest Income		—		—		—		10		—		—		—		—		—		10
Other Inome		—		—		—		—		—		—		—		—		—		—
Gain on sale of real estate		—		—		—		1,324,174		337,251		—		—		—		—		1,661,425
		(289,041)		—		(397,726)		1,174,123		337,180		(261,440)		(286,628)		(772,201)		(4,875,137)		(5,370,870)
Net Income (Loss)	$	198,628	$	163,955	$	343,062	$	1,286,692	$	332,904	$	(225,100)	$	10,263	$	(17,710)	$	1,848,705	$	3,941,397
Net Income (Loss)—NERA 50%	$	99,314	$	81,978	$	171,530	$	643,346	$	166,451	$	(112,550)	$	5,132	$	(8,855)				1,046,345
Net Income —NERA 40%																	$	739,482		739,482
																			$	1,785,827

Summary financial information for the year ended December 31, 2015

			Hamilton						Hamilton				Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Bay		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Sales		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,464,871	$	277,568	$	1,396,428	$	962,511	$	99,413	$	973,559	$	942,539	$	3,093,045	$	14,316,846	$	23,526,780
Laundry and Sundry Income		13,319		—		656		—		—		—		—		44,911		93,064		151,950
		1,478,190		277,568		1,397,084		962,511		99,413		973,559		942,539		3,137,956		14,409,910		23,678,730
Expenses
Administrative		28,849		2,000		35,071		6,262		8,105		8,592		5,402		48,818		225,509		368,608
Depreciation and Amortization		439,046		2,829		368,775		236,513		25,418		295,176		329,150		955,269		3,219,340		5,871,516
Management Fees		63,226		11,114		57,604		37,736		3,987		38,640		38,683		122,405		304,868		678,263
Operating		102,872		—		80,873		1,050		911		1,173		93,492		432,352		1,234,505		1,947,228
Renting		11,246		—		15,815		270		—		2,986		8,807		9,765		122,378		171,267
Repairs and Maintenance		153,329		200		61,183		314,409		43,559		362,861		82,769		393,665		1,134,751		2,546,726
Taxes and Insurance		216,602		52,846		124,266		166,842		20,461		154,348		124,393		341,990		1,548,439		2,750,187
		1,015,170		68,989		743,587		763,082		102,441		863,776		682,696		2,304,264		7,789,790		14,333,795
Income Before Other Income		463,020		208,579		653,497		199,429		(3,028)		109,783		259,843		833,692		6,620,120		9,344,935
Other Income (Loss)
Interest Expense		(432,732)		(46,283)		(398,414)		(281,093)		(322)		(265,636)		(308,725)		(769,579)		(4,937,726)		(7,440,510)
Interest Income		—		—				14		—		—		—		—		—		14
Other Inome		—		—		—		—		—		—		—		96		—		96
Gain on sale of real estate		—		—		—		—		169,093		—		—		—		—		169,093
		(432,732)		(46,283)		(398,414)		(281,079)		168,771		(265,636)		(308,725)		(769,483)		(4,937,726)		(7,271,307)
Net Income (Loss)	$	30,288	$	162,296	$	255,083	$	(81,651)	$	165,743	$	(155,854)	$	(48,883)	$	64,209	$	1,682,394	$	2,073,625
Net Income (Loss)—NERA 50%	$	15,144	$	81,148	$	127,543	$	(40,826)	$	82,872	$	(77,927)	$	(24,442)	$	32,105				195,617
Net Income —NERA 40%																	$	672,958		672,958
																			$	868,574

Schedule of future annual mortgage maturities

Future annual mortgage maturities at December 31, 2017 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
12/31/2018	$	—	$	190,248	$	—	$	—	$	1,684,479	$	1,874,727
12/31/2019		—		197,742		—		—		80,320,017		80,517,759
12/31/2020		—		205,532		—		—				205,532
12/31/2021		—		213,629		—		—				213,629
12/31/2022		—		222,044		—		—				222,044
Thereafter		10,000,000		8,713,565		6,000,000		16,900,000		—		41,613,565
		10,000,000		9,742,760		6,000,000		16,900,000		82,004,496		124,647,256
Less: unamortized deferred financing costs		(106,865)		(69,914)		(112,182)		(107,009)		(106,274)		(502,244)
	$	9,893,135	$	9,672,846	$	5,887,818	$	16,792,991	$	81,898,222	$	124,145,012

At December 31, 2017 the weighted average interest rate on the above mortgages was 4.99%. The effective rate was 5.08% including the amortization expense of deferred financing costs.

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SALES OF REAL ESTATE (Tables)

12 Months Ended

Dec. 31, 2017

SALES OF REAL ESTATE

Schedule of gain on the sale of real estate property

Gain on the Sale of property at Hamilton Green in 2016:
Sale price	$	1,000,000
Net book value		668,544
Expense of sale		227,013
Gain on the sale of real estate	$	104,443

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QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables)

12 Months Ended

Dec. 31, 2017

QUARTERLY FINANCIAL DATA (UNAUDITED)

Schedule of quarterly financial data (unaudited)

	Three Months Ended
	March 31, 2017		June 30, 2017		September 30, 2017		December 31, 2017		Total
Revenue	$	12,743,607	$	12,787,791	$	13,421,805	$	13,874,185	$	52,827,388
Expenses		9,001,696		8,817,160		10,493,852		10,369,714		38,682,422
Income Before Other Income and Discontinued Operations		3,741,911		3,970,631		2,927,953		3,504,471		14,144,966
Other Expenses		(1,847,677)		(1,486,924)		(2,056,233)		(1,816,201)		(7,207,035)
Net Income	$	1,894,234	$	2,483,707	$	871,720	$	1,688,270	$	6,937,931
Net Income per Unit before Discontinued Operations	$	15.23	$	19.97	$	7.01	$	13.56	$	55.77
Net Income Per Unit	$	15.23	$	19.97	$	7.01	$	13.56	$	55.77
Income Per Depositary Receipt Before Discontinued Operations	$	0.51	$	0.67	$	0.23	$	0.45	$	1.86
Net Income Per Depositary Receipt	$	0.51	$	0.67	$	0.23	$	0.45	$	1.86

	Three Months Ended
	March 31, 2016		June 30, 2016		September 30, 2016		December 31, 2016		Total
Revenue	$	12,183,288	$	12,254,264	$	12,371,881	$	12,745,657	$	49,555,090
Expenses		8,768,697		9,019,667		9,274,045		9,232,731		36,295,140
Income Before Other Income and Discontinued Operations		3,414,591		3,234,597		3,097,836		3,512,926		13,259,950
Other Expenses		(2,183,827)		(2,254,011)		(1,887,089)		(1,984,171)		(8,309,098)
Net Income	$	1,230,764	$	980,586	$	1,210,747	$	1,528,755	$	4,950,852
Net Income  per Unit before Discontinued Operations	$	9.84	$	7.85	$	9.69	$	12.24	$	39.62
Net Income  Per Unit	$	9.84	$	7.85	$	9.69	$	12.24	$	39.62
Income Per Depositary Receipt Before Discontinued Operations	$	0.33	$	0.26	$	0.32	$	0.41	$	1.32
Net Income  Per Depositary Receipt	$	0.33	$	0.26	$	0.32	$	0.41	$	1.32

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QUALIFYING ACCOUNTS (Tables)

12 Months Ended

Dec. 31, 2017

QUALIFYING ACCOUNTS

Schedule of valuation and qualifying accounts

		Additions
	Balance at	Charged to	Charged to		Balance
	Beginning	Costs and	other account	Deductions	at end
Description	of Period	Expenses	describe	Describe(a)	of Period
Year Ended December 31, 2017:
Deducted from asset accounts:
Allowance for doubtful accounts	523,004	422,109		301,123	643,990
Year Ended December 31, 2016:
Deducted from asset accounts:
Allowance for doubtful accounts	372,828	365,746		215,570	523,004
Year Ended December 31, 2015:
Deducted from asset accounts:
Allowance for doubtful accounts	366,105	201,622		194,899	372,828

(a) Uncollectible accounts written off

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SIGNIFICANT ACCOUNTING POLICIES (Business) (Details)	Dec. 31, 2017 ft² property item	Dec. 31, 2016 item	Dec. 31, 2015 item
Line of Business
Number of units			1,033
Residential buildings
Line of Business
Number of units			1,030
Commercial
Line of Business
Number of units			3
Wholly owned properties
Line of Business
Number of Real Estate Properties | property	26
Wholly owned properties | Residential and mixed-use properties
Line of Business
Number of Real Estate Properties | property	22
Number of units	2,632
Wholly owned properties | Residential buildings
Line of Business
Number of Real Estate Properties | property	18
Wholly owned properties | Mixed use residential, retail and office buildings
Line of Business
Number of Real Estate Properties | property	4
Wholly owned properties | Commercial
Line of Business
Number of Real Estate Properties | property	3
Area of property (in square feet) | ft²	108,043
Wholly owned properties | Condominium
Line of Business
Number of Real Estate Properties | property	1
Number of units	19
Partially owned properties | Residential and mixed-use properties
Line of Business
Number of Real Estate Properties	9
Number of properties after balance sheet date	722
Number of units	722
Partially owned properties | Residential and mixed-use properties | Minimum
Line of Business
Ownership interest (as a percent)	40.00%
Partially owned properties | Commercial
Line of Business
Area of property (in square feet) | ft²	12,500
Partially owned properties | Car parking lot
Line of Business
Capacity of real estate property (in cars per lot)	50
Investment Properties
Line of Business
Number of units	1,033	1,033
Investment Properties | Minimum
Line of Business
Ownership interest (as a percent)	40.00%
Investment Properties | Maximum
Line of Business
Ownership interest (as a percent)	50.00%
Investment Properties | Residential buildings
Line of Business
Number of units	1,030	1,030
Investment Properties | Commercial
Line of Business
Number of units	3	3
Investment Properties | Partially owned properties | Residential and mixed-use properties
Line of Business
Number of Real Estate Properties	9
Investment Properties | Partially owned properties | Residential and mixed-use properties | Minimum
Line of Business
Ownership interest (as a percent)	40.00%
Investment Properties | Partially owned properties | Residential and mixed-use properties | Maximum
Line of Business
Ownership interest (as a percent)	50.00%

XML

SIGNIFICANT ACCOUNTING POLICIES (Details)		12 Months Ended
	Jan. 03, 2012	Dec. 31, 2017 USD ($) item shares	Dec. 31, 2016 USD ($) tenant	Dec. 31, 2015 USD ($) tenant	Dec. 31, 2014 USD ($) tenant
Principles of Consolidation
Value at which partnership investments discontinue use of equity method		$ 0
Amount of legal obligations related to investments no longer classified as equity method		$ 0
Revenue Recognition
Period for which arrears are charged against income		60 days
Deferred Financing Costs
Amortization of deferred financing costs		$ 193,000	$ 188,000	$ 171,000
Income Taxes
Provision for income taxes		$ 0
Segment Reporting
Number of segments | item		1
Income Per Unit
Dilutive units | shares		0
Concentration of Credit Risks and Financial Instruments
Single tenants | tenant			0	0	0
Federally uninsured amounts of cash and cash equivalents, and security deposits included in prepaid expenses and other assets		$ 8,898,000	$ 8,911,000
Advertising Expense
Advertising expense		$ 201,040	191,815	$ 165,070
Interest Capitalized
Capitalized interest			0	0	$ 0
Amortization of deferred financing costs
Reclassification
Prior period adjustment				(171,000)
Interest expenses
Reclassification
Prior period adjustment				171,000
Net income
Reclassification
Prior period adjustment			$ 0	$ 0	$ 0
Minimum
Principles of Consolidation
Ownership interest in each subsidiary (as a percent)		99.67%
Interest Capitalized
Criteria of capitalization of interest on property based on specified period of construction		1 year
Minimum | Cash and cash equivalents
Concentration of Credit Risks and Financial Instruments
Interest rate on interest bearing accounts (as a percent)		0.01%
Maximum
Principles of Consolidation
Ownership interest in each subsidiary (as a percent)		100.00%
Maximum | Cash and cash equivalents
Concentration of Credit Risks and Financial Instruments
Interest rate on interest bearing accounts (as a percent)		0.20%
Investment Properties
Principles of Consolidation
Number of limited liability companies/partnerships | item		9
Investment Properties | Minimum
Principles of Consolidation
Percentage of ownership interest		40.00%
Investment Properties | Maximum
Principles of Consolidation
Percentage of ownership interest		50.00%
Class A
Income (Loss) Per Depositary Receipt
Forward split of depositary receipts	3
Exchange ratio of depositary receipts for partnership units before adjustment	10
Exchange ratio of depositary receipts for partnership units after adjustment	30
Number of units in each depository receipt	0.03333

XML

RENTAL PROPERTIES (Details)	12 Months Ended
	Dec. 31, 2017 USD ($) property item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 item
RENTAL PROPERTIES
Number of units | item			1,033
Rental properties
Total fixed assets	$ 311,951,597	$ 263,659,293
Less: Accumulated depreciation	(104,797,803)	(94,196,482)
Total fixed assets, net	207,153,794	169,462,811
Land, improvements and parking lots
Rental properties
Total fixed assets	$ 65,087,214	52,612,929
Land, improvements and parking lots | Minimum
Rental properties
Useful Life	15 years
Land, improvements and parking lots | Maximum
Rental properties
Useful Life	40 years
Buildings and improvements
Rental properties
Total fixed assets	$ 201,844,565	173,536,288
Buildings and improvements | Minimum
Rental properties
Useful Life	15 years
Buildings and improvements | Maximum
Rental properties
Useful Life	40 years
Kitchen cabinets
Rental properties
Total fixed assets	$ 12,338,627	8,738,323
Kitchen cabinets | Minimum
Rental properties
Useful Life	5 years
Kitchen cabinets | Maximum
Rental properties
Useful Life	10 years
Carpets
Rental properties
Total fixed assets	$ 8,802,831	7,621,292
Carpets | Minimum
Rental properties
Useful Life	5 years
Carpets | Maximum
Rental properties
Useful Life	10 years
Air conditioning
Rental properties
Total fixed assets	$ 641,079	690,535
Air conditioning | Minimum
Rental properties
Useful Life	5 years
Air conditioning | Maximum
Rental properties
Useful Life	10 years
Laundry equipment
Rental properties
Total fixed assets	$ 263,275	269,784
Laundry equipment | Minimum
Rental properties
Useful Life	5 years
Laundry equipment | Maximum
Rental properties
Useful Life	7 years
Elevators
Rental properties
Total fixed assets	$ 1,139,296	1,139,296
Elevators | Minimum
Rental properties
Useful Life	20 years
Elevators | Maximum
Rental properties
Useful Life	40 years
Swimming pools
Rental properties
Total fixed assets	$ 444,629	444,629
Swimming pools | Minimum
Rental properties
Useful Life	10 years
Swimming pools | Maximum
Rental properties
Useful Life	30 years
Equipment
Rental properties
Total fixed assets	$ 11,163,864	10,029,639
Equipment | Minimum
Rental properties
Useful Life	5 years
Equipment | Maximum
Rental properties
Useful Life	30 years
Motor vehicles
Rental properties
Total fixed assets	$ 216,260	237,954
Useful Life	5 years
Fences
Rental properties
Total fixed assets	$ 37,465	37,465
Fences | Minimum
Rental properties
Useful Life	5 years
Fences | Maximum
Rental properties
Useful Life	15 years
Furniture and fixtures
Rental properties
Total fixed assets	$ 9,390,021	8,127,100
Furniture and fixtures | Minimum
Rental properties
Useful Life	5 years
Furniture and fixtures | Maximum
Rental properties
Useful Life	7 years
Smoke alarms
Rental properties
Total fixed assets	$ 582,471	$ 174,059
Smoke alarms | Minimum
Rental properties
Useful Life	5 years
Smoke alarms | Maximum
Rental properties
Useful Life	7 years
Wholly owned properties
RENTAL PROPERTIES
Number of properties | property	26
Investment Properties
RENTAL PROPERTIES
Number of units | item	1,033	1,033
Investment Properties | Minimum
RENTAL PROPERTIES
Ownership interest (as a percent)	40.00%
Investment Properties | Maximum
RENTAL PROPERTIES
Ownership interest (as a percent)	50.00%
Residential and mixed-use properties | Wholly owned properties
RENTAL PROPERTIES
Number of units | item	2,632
Number of properties | property	22
Residential and mixed-use properties | Partially owned properties
RENTAL PROPERTIES
Number of units | item	722
Number of properties | item	9
Residential and mixed-use properties | Partially owned properties | Minimum
RENTAL PROPERTIES
Ownership interest (as a percent)	40.00%
Residential and mixed-use properties | Investment Properties | Partially owned properties
RENTAL PROPERTIES
Number of properties | item	9
Residential and mixed-use properties | Investment Properties | Partially owned properties | Minimum
RENTAL PROPERTIES
Ownership interest (as a percent)	40.00%
Residential and mixed-use properties | Investment Properties | Partially owned properties | Maximum
RENTAL PROPERTIES
Ownership interest (as a percent)	50.00%
Condominium | Wholly owned properties
RENTAL PROPERTIES
Number of units | item	19
Number of properties | property	1

XML

RENTAL PROPERTIES - Real Estate Detail (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2012
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	$ 234,629,675
Initial Cost to Partnerships
Land	57,135,253
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	43,986,579
Gross Amount at Which Carried at Close of Period
Land	57,091,060
Building Improvements	254,860,534
Totals	311,951,597	$ 263,659,293	$ 261,276,898	$ 225,021,946
Accumulated Depreciation	104,797,803	$ 94,196,482	$ 84,579,584	$ 75,905,862
Buildings and improvements
Initial Cost to Partnerships
Building Improvements	$ 210,873,955
Buildings and improvements | Minimum
Gross Amount at Which Carried at Close of Period
Estimated useful lives	10 years
Buildings and improvements | Maximum
Gross Amount at Which Carried at Close of Period
Estimated useful lives	40 years
Other Categories of Assets | Minimum
Gross Amount at Which Carried at Close of Period
Estimated useful lives	5 years
Other Categories of Assets | Maximum
Gross Amount at Which Carried at Close of Period
Estimated useful lives	15 years
Boylston Downtown L.P. Residential Apartments Boston, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	$ 39,049,572
Initial Cost to Partnerships
Land	2,112,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	8,836,077
Gross Amount at Which Carried at Close of Period
Land	2,112,000
Building Improvements	17,429,186
Totals	19,541,186
Accumulated Depreciation	11,977,004
Boylston Downtown L.P. Residential Apartments Boston, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	8,593,109
Brookside Associates LLC Residential Apartments Woburn, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	2,501,972
Initial Cost to Partnerships
Land	684,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	432,022
Gross Amount at Which Carried at Close of Period
Land	684,000
Building Improvements	3,548,022
Totals	4,232,022
Accumulated Depreciation	2,174,123
Brookside Associates LLC Residential Apartments Woburn, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	3,116,000
Clovelly Apartments L.P. Residential Apartments Nashua, New Hampshire
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	4,160,000
Initial Cost to Partnerships
Land	177,610
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	1,701,168
Gross Amount at Which Carried at Close of Period
Land	177,610
Building Improvements	3,179,527
Totals	3,357,137
Accumulated Depreciation	2,250,924
Clovelly Apartments L.P. Residential Apartments Nashua, New Hampshire | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	1,478,359
Commonwealth 1137 L.P. Residential Apartments Boston, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	3,750,000
Initial Cost to Partnerships
Land	342,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	1,196,072
Gross Amount at Which Carried at Close of Period
Land	342,000
Building Improvements	2,563,741
Totals	2,905,741
Accumulated Depreciation	1,765,386
Commonwealth 1137 L.P. Residential Apartments Boston, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	1,367,669
Commonwealth 1144 L.P. Residential Apartments Boston, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	14,780,000
Initial Cost to Partnerships
Land	1,410,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	3,924,962
Gross Amount at Which Carried at Close of Period
Land	1,410,000
Building Improvements	9,589,778
Totals	10,999,778
Accumulated Depreciation	5,954,341
Commonwealth 1144 L.P. Residential Apartments Boston, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	5,664,816
Executive Apartments L.P. Residential Apartments Framingham, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	2,415,000
Initial Cost to Partnerships
Land	91,400
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	1,286,060
Gross Amount at Which Carried at Close of Period
Land	91,400
Building Improvements	2,026,420
Totals	2,117,820
Accumulated Depreciation	1,225,043
Executive Apartments L.P. Residential Apartments Framingham, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	740,360
Hamilton Battle Green LLC Residential Apartments Lexington, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	4,460,057
Initial Cost to Partnerships
Land	1,341,737
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	159,257
Gross Amount at Which Carried at Close of Period
Land	1,341,737
Building Improvements	8,616,754
Totals	9,958,491
Accumulated Depreciation	2,314,831
Hamilton Battle Green LLC Residential Apartments Lexington, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	8,457,497
Hamilton Cypress LLC Commercial-1031 Exchange Brookline, Massachusetts
Initial Cost to Partnerships
Land	2,362,596
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	249,024
Gross Amount at Which Carried at Close of Period
Land	2,362,596
Building Improvements	4,863,009
Totals	7,225,605
Accumulated Depreciation	1,470,530
Hamilton Cypress LLC Commercial-1031 Exchange Brookline, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	4,613,985
Hamilton Green Apartments Residential Apartments Andover, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	36,555,470
Initial Cost to Partnerships
Land	16,054,336
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	581,025
Gross Amount at Which Carried at Close of Period
Land	16,054,336
Building Improvements	45,375,463
Totals	61,429,799
Accumulated Depreciation	15,460,634
Hamilton Green Apartments Residential Apartments Andover, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	44,794,438
Hamilton Linewt LLC Commercial-1031 Exchange Newton, Massachusetts
Initial Cost to Partnerships
Land	884,042
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	138,904
Gross Amount at Which Carried at Close of Period
Land	884,042
Building Improvements	2,791,031
Totals	3,675,073
Accumulated Depreciation	706,988
Hamilton Linewt LLC Commercial-1031 Exchange Newton, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	2,652,127
Hamilton Oaks Associates LLC Residential Apartments Brockton, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	11,925,000
Initial Cost to Partnerships
Land	2,175,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	3,281,817
Gross Amount at Which Carried at Close of Period
Land	2,175,000
Building Improvements	15,606,817
Totals	17,781,817
Accumulated Depreciation	9,876,116
Hamilton Oaks Associates LLC Residential Apartments Brockton, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	12,325,000
Highland Street Apartments, L.P. Residential Apartments Lowell, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	1,050,000
Initial Cost to Partnerships
Land	156,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	274,024
Gross Amount at Which Carried at Close of Period
Land	156,000
Building Improvements	908,109
Totals	1,064,109
Accumulated Depreciation	647,937
Highland Street Apartments, L.P. Residential Apartments Lowell, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	634,085
Linhart L.P. Residential/Commercial Newton, Massachusetts
Initial Cost to Partnerships
Land	385,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	1,585,649
Gross Amount at Which Carried at Close of Period
Land	385,000
Building Improvements	3,125,649
Totals	3,510,649
Accumulated Depreciation	2,245,989
Linhart L.P. Residential/Commercial Newton, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	1,540,000
NERA Dean St. Associates LLC Residential Apartments Norwood, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	5,687,000
Initial Cost to Partnerships
Land	1,512,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	1,086,013
Gross Amount at Which Carried at Close of Period
Land	1,512,000
Building Improvements	6,787,493
Totals	8,299,493
Accumulated Depreciation	3,702,802
NERA Dean St. Associates LLC Residential Apartments Norwood, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	5,701,480
North Beacon 140 L.P. Residential Units Boston, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	6,937,000
Initial Cost to Partnerships
Land	936,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	2,350,856
Gross Amount at Which Carried at Close of Period
Land	936,000
Building Improvements	6,112,869
Totals	7,048,869
Accumulated Depreciation	4,279,547
North Beacon 140 L.P. Residential Units Boston, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	3,762,013
Olde English Apartments L.P. Residential Apartments Lowell, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	3,080,000
Initial Cost to Partnerships
Land	46,181
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	1,026,852
Gross Amount at Which Carried at Close of Period
Land	46,181
Building Improvements	1,905,175
Totals	1,951,356
Accumulated Depreciation	1,289,709
Olde English Apartments L.P. Residential Apartments Lowell, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	878,323
Redwood Hills L.P. Residential Units Worcester, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	6,743,000
Initial Cost to Partnerships
Land	1,200,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	3,946,412
Gross Amount at Which Carried at Close of Period
Land	1,200,000
Building Improvements	8,757,016
Totals	9,957,016
Accumulated Depreciation	5,547,278
Redwood Hills L.P. Residential Units Worcester, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	4,810,604
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	20,071,000
Initial Cost to Partnerships
Land	6,247,153
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	825,028
Gross Amount at Which Carried at Close of Period
Land	6,247,153
Building Improvements	25,779,805
Totals	32,026,958
Accumulated Depreciation	3,149,707
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	24,954,777
River Drive L.P. Residential Apartments Danvers, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	3,465,000
Initial Cost to Partnerships
Land	72,525
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	1,033,453
Gross Amount at Which Carried at Close of Period
Land	72,525
Building Improvements	1,621,230
Totals	1,693,755
Accumulated Depreciation	840,124
River Drive L.P. Residential Apartments Danvers, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	587,777
Riverside Apartments Condominium Units Massachusetts
Initial Cost to Partnerships
Land	23,346
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	77,051
Gross Amount at Which Carried at Close of Period
Land	23,346
Building Improvements	267,858
Totals	291,204
Accumulated Depreciation	223,822
Riverside Apartments Condominium Units Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	190,807
School St Assoc LLC Residential Apartments Framingham, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	14,549,604
Initial Cost to Partnerships
Land	4,686,728
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	(346,294)
Gross Amount at Which Carried at Close of Period
Land	4,686,728
Building Improvements	18,400,617
Totals	23,087,345
Accumulated Depreciation	9,487,028
School St Assoc LLC Residential Apartments Framingham, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	18,746,911
WRF Associates LLC Strip Mall Framingham, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	6,000,000
Initial Cost to Partnerships
Land	3,280,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	82,460
Gross Amount at Which Carried at Close of Period
Land	3,280,000
Building Improvements	5,002,460
Totals	8,282,460
Accumulated Depreciation	3,070,591
WRF Associates LLC Strip Mall Framingham, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	4,920,000
WCB Associates LLC Residential Apartments Brockton, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	7,000,000
Initial Cost to Partnerships
Land	1,335,000
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	2,342,341
Gross Amount at Which Carried at Close of Period
Land	1,335,000
Building Improvements	9,907,842
Totals	11,242,842
Accumulated Depreciation	6,109,227
WCB Associates LLC Residential Apartments Brockton, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	7,565,501
Westgate Apartments Residential Units Burlington Massachusetts Member
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	2,500,000
Initial Cost to Partnerships
Land	44,965
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	225,772
Gross Amount at Which Carried at Close of Period
Land	44,965
Building Improvements	4,704,459
Totals	4,749,424
Accumulated Depreciation	2,325,390
Westgate Apartments Residential Units Burlington Massachusetts Member | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	4,478,687
Westgate Apartments LLC Residential Apartments Woburn, Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	15,700,000
Initial Cost to Partnerships
Land	461,300
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	7,149,052
Gross Amount at Which Carried at Close of Period
Land	417,107
Building Improvements	9,573,688
Totals	9,990,795
Accumulated Depreciation	5,681,385
Westgate Apartments LLC Residential Apartments Woburn, Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	2,424,636
Woodland Park Apartments LLC Newton Massachusetts
Real estate and accumulated depreciation
Encumbrances (First Mortgages)	22,250,000
Initial Cost to Partnerships
Land	9,114,334
Cost Capitalized Subsequent to Acquisition
Improvements, Net of retirements	541,522
Gross Amount at Which Carried at Close of Period
Land	9,114,334
Building Improvements	36,416,516
Totals	45,530,850
Accumulated Depreciation	1,021,349
Woodland Park Apartments LLC Newton Massachusetts | Buildings and improvements
Initial Cost to Partnerships
Building Improvements	$ 35,874,994

XML

RENTAL PROPERTIES (Reconciliation) (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Rental Properties
Balance, Beginning	$ 263,659,293	$ 261,276,898
Additions:
Buildings, improvements and other assets	50,784,476	5,163,081	$ 37,895,926
Balance before deductions	314,443,769	266,439,979	262,917,872
Deduct:
Write-offs of retired or disposed assets	2,492,172	2,112,142	1,640,974
Rental properties held for sale and/or sold		668,544
Balance, Ending	311,951,597	263,659,293	261,276,898
Accumulated Depreciation
Balance, Beginning	94,196,482	84,579,584
Add:
Depreciation for the year	13,093,493	11,729,039	10,314,696
Total additions	107,289,975	96,308,623	86,220,558
Deduct:
Accumulated depreciation of retired or disposed assets	2,492,172	2,112,141	1,640,974
Balance, Ending	$ 104,797,803	$ 94,196,482	$ 84,579,584

XML

RENTAL PROPERTIES (Woodland Park Apartments) (Details)	Sep. 29, 2017 USD ($)	Jul. 06, 2017 USD ($) item	Jul. 16, 2017 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 item
RENTAL PROPERTIES
Number of units | item					1,033
Line of credit				$ 17,000,000
Woodland Park Apartments LLC Newton Massachusetts
RENTAL PROPERTIES
Number of units | item		126
Purchase price of real estate properties		$ 45,600,000
Closing costs associated with financing	$ 176,000	64,000
Line of credit		25,000,000
Loan amount	$ 22,250,000	16,000,000	$ 16,000,000
Interest rate (as a percent)	3.79%		4.75%
Fixed interest rate period	10 years
Interest only period	5 years
Term of debt	30 years
Purchase price allocated to the value of the in-place leases		541,000
Purchase price allocated to the value of the tenant relationships		$ 42,000
Amortization period of value of the in-place leases		12 months
Amortization period of value of the tenant relationships		24 months

XML

RENTAL PROPERTIES (Hamilton Green) (Details)			1 Months Ended	12 Months Ended
	Aug. 03, 2016 USD ($)	Aug. 31, 2004 USD ($)	Aug. 31, 2014 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 item
RENTAL PROPERTIES
Number of units | item					1,033
Gain on sale of real estate				$ (104,443)
Hamilton Green
RENTAL PROPERTIES
Sales price of real estate properties	$ 1,000,000			1,000,000
Gain on sale of real estate	103,793
Closing costs	227,663
Cost basis of the property	(668,544)
Prepayment penalty	$ 187,905
Hamilton on Main Apts
RENTAL PROPERTIES
Purchase price of real estate properties		$ 56,000,000
Mortgage, 4.34%, August 2014 | Hamilton on Main Apts
RENTAL PROPERTIES
Closing costs				$ 161,000
Term of debt			10 years
Mortgage amount			$ 16,900,000
Interest rate (as a percent)			4.34%

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RELATED PARTY TRANSACTIONS (Details)	12 Months Ended
	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)	Sep. 29, 2017 USD ($)	Jul. 16, 2017 USD ($)	Jul. 06, 2017 USD ($)
RELATED PARTY TRANSACTIONS
Management fee	$ 2,159,458	$ 2,029,171	$ 1,869,977
Repairs and maintenance	8,378,639	8,258,263	6,998,592
Administrative expense	$ 2,008,107	2,102,812	2,096,290
Number of advisory committee meetings | item	4
Expenses incurred for advisory committee meeting	$ 19,000
Number of audit committee meetings held | item	4
Expenses incurred for audit committee meeting	$ 12,000
Interest expense	$ 11,114,146	10,200,393	9,980,359
Majority of Partnership Properties, Excluding Linewt
RELATED PARTY TRANSACTIONS
Management fee as percentage of gross receipts rental revenue	4.00%
Hamilton Linewt LLC Commercial-1031 Exchange Newton, Massachusetts
RELATED PARTY TRANSACTIONS
Management fee as percentage of gross receipts rental revenue	3.00%
Woodland Park Apartments LLC Newton Massachusetts
RELATED PARTY TRANSACTIONS
Loan amount					$ 22,250,000	$ 16,000,000	$ 16,000,000
Interest rate (as a percent)					3.79%	4.75%
Interest expense	$ 182,000
Investment Properties
RELATED PARTY TRANSACTIONS
Number of limited partnerships and limited liability companies in which the entity has invested | item	9
Investment Properties | Minimum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	40.00%
Investment Properties | Maximum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	50.00%
Hamilton Company/Management Company
RELATED PARTY TRANSACTIONS
Employer contributions in 401K plan		0	0	$ 0
Number of accounting staff of related party providing bookkeeping and accounting functions | item	14
Number of employees having ownership interest in the investment properties | item	5
Hamilton Company/Management Company, Related Party
RELATED PARTY TRANSACTIONS
Management fee	$ 2,159,000	2,029,000	1,870,000
Related Party Transaction, Services, Excluding Management Fee	882,000	1,069,000	994,000
Repairs and maintenance	295,000
Administrative expense	359,000
Construction, architectural services and supervision of capital projects	227,000
Commercial brokerage fees	1,000
Reimbursement to related party for payroll transfers	3,463,000	3,076,000	2,958,000
Fees for accounting and bookkeeping services		125,000	125,000	125,000
Investment Properties | Hamilton Company/Management Company
RELATED PARTY TRANSACTIONS
Property Management Fee Revenue And Other Service Revenue	1,377,000
Amount received for management fees	673,000
Amount received for construction, architectural services and supervision of capital projects	620,000
Amount received for maintenance	44,000
Amount received for administrative services	$ 40,000
Number of employees having ownership interest in the investment properties | item	5
Investment Properties, Excluding Dexter Park | Hamilton Company/Management Company
RELATED PARTY TRANSACTIONS
Property management fee received (as a percent)	4.00%
Dexter Park | Hamilton Company/Management Company
RELATED PARTY TRANSACTIONS
Property management fee received (as a percent)	2.00%
President of Management Company
RELATED PARTY TRANSACTIONS
Quarterly fee for asset management consulting services		18,750	18,750	18,750
Fee for asset management consulting services		$ 75,000	$ 75,000	$ 75,000
Harold Brown | Investment Properties | Minimum
RELATED PARTY TRANSACTIONS
Ownership interest of related party (as a percent)	43.20%
Harold Brown | Investment Properties | Maximum
RELATED PARTY TRANSACTIONS
Ownership interest of related party (as a percent)	56.00%
Residential and mixed-use properties | Partially owned properties | Minimum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	40.00%
Residential and mixed-use properties | Partially owned properties | Investment Properties | Minimum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	40.00%
Residential and mixed-use properties | Partially owned properties | Investment Properties | Maximum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	50.00%

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OTHER ASSETS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Deposits and escrows held for acquisitions	$ 488,396	$ 444,625
Prepaid Expenses and Other Assets
Security deposits	2,420,000	2,381,000
Escrow deposits to fund future capital improvements	357,000	423,000
Finite-lived Intangible Assets Acquired	302,000	12,000
Accumulated amortization on intangible assets	$ 280,000	$ 2,245,000

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MORTGAGE NOTES PAYABLE (Mortgages Payable) (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
MORTGAGE NOTES PAYABLE
Effective interest rate (as a percent)	5.08%
Annual maturities of mortgage debt
Less: unamortized deferred financing costs	$ (502,244)
Secured Debt	233,221,258	$ 212,709,080
Mortgages payable
MORTGAGE NOTES PAYABLE
Amount of monthly installments including principal	$ 1,060,000
Weighted average interest rate (as a percent)	4.59%
Effective interest rate (as a percent)	4.67%
Financing fees, net	$ 1,531,000	1,425,000
Accumulated amortization on financing and leasing fees	1,149,000	1,061,000
Deferred financing costs	121,000	$ 28,000
Annual maturities of mortgage debt
2018-current maturities	7,843,000
2019	1,923,000
2020	4,331,000
2021	2,449,000
2022	2,686,000
Thereafter	215,397,000
Total	234,629,000
Less: unamortized deferred financing costs	1,408,000
Secured Debt	$ 233,221,000
Mortgages payable | Minimum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)	3.24%
Mortgages payable | Maximum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)	5.97%

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MORTGAGE NOTES PAYABLE (Mortgage by property) (Details) - USD ($)	Sep. 29, 2017	Aug. 03, 2016	Dec. 31, 2017	Jul. 16, 2017	Jul. 06, 2017
Hamilton Green
MORTGAGE NOTES PAYABLE
Closing Costs		$ 227,663
Woodland Park Apartments LLC Newton Massachusetts
MORTGAGE NOTES PAYABLE
Term of debt	30 years
Mortgage amount	$ 22,250,000			$ 16,000,000	$ 16,000,000
Interest rate (as a percent)	3.79%			4.75%
Mortgages payable | Minimum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)			3.24%
Mortgages payable | Maximum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)			5.97%

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MORTGAGE NOTES PAYABLE (Line of Credit) (Details)					12 Months Ended
	Sep. 29, 2017 USD ($)	Jan. 15, 2016 USD ($)	Jan. 07, 2016 USD ($)	Jul. 31, 2014 USD ($)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Jul. 16, 2017 USD ($)	Jul. 06, 2017 USD ($)
Line of Credit
Interest expense					$ 11,114,146	$ 10,200,393	$ 9,980,359
Payment on line of credit					24,000,000	25,000,000
Credit line balance						$ 17,000,000
Woodland Park Apartments LLC Newton Massachusetts
Line of Credit
Term of debt	30 years
Loan amount	$ 22,250,000							$ 16,000,000	$ 16,000,000
Interest expense					182,000
Credit line balance									$ 25,000,000
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts
Line of Credit
Credit line balance			$ 0
Amount of loan proceeds and cash reserves utilized to pay off the existing line of credit		$ 2,000,000	23,000,000
LIBOR | Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts
Line of Credit
Loan amount			$ 20,071,000
LIBOR | Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts
Line of Credit
Margin over basis of interest rate (as a percent)			2.01%
Line of Credit
Line of Credit
Maximum borrowings				$ 25,000,000
Term of debt				3 years
Payment on line of credit	8,000,000
Amount of refinancing costs					128,000
Credit line balance					$ 17,000,000
Number of properties in which borrowing amount collateralized | item					23
Commitment fee					$ 29,000
Line of Credit | Woodland Park Apartments LLC Newton Massachusetts
Line of Credit
Funds drawn by the company	$ 25,000,000
Line of Credit | Federal Funds Rate
Line of Credit
Basis of effective interest rate used in calculation of Base Rate (as a percent)				0.50%
Line of Credit | LIBOR
Line of Credit
Basis of effective interest rate used in calculation of Base Rate (as a percent)				1.00%
Margin over basis of interest rate (as a percent)				2.50%
Line of Credit | Minimum
Line of Credit
Pledged interests of the Partnership's ownership interest (as a percent)					49.00%
Commitment fee for unused amount (as a percent)					0.15%
Tangible net worth					$ 150,000,000
Ratio of net operating income to total indebtedness					9.50%
Debt service coverage ratio					1.6
Line of Credit | Maximum
Line of Credit
Pledged interests of the Partnership's ownership interest (as a percent)					100.00%
Commitment fee for unused amount (as a percent)					0.20%
Leverage ratio					65.00%
Aggregate increase in indebtedness					$ 15,000,000

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ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS
Period for advance rental payment	1 month
Amount received for prepaid rent	$ 2,127,000	$ 1,954,000
Security deposits	$ 2,420,000	$ 2,381,000

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PARTNERS' CAPITAL (Details)			1 Months Ended	3 Months Ended								12 Months Ended
	Mar. 15, 2018 $ / item	Jan. 03, 2012	Dec. 31, 2016 $ / item	Dec. 31, 2017 $ / item	Sep. 30, 2017 $ / item	Jun. 30, 2017 $ / item	Mar. 31, 2017 $ / item	Dec. 31, 2016 $ / item	Sep. 30, 2016 $ / item	Jun. 30, 2016 $ / item	Mar. 31, 2016 $ / item	Dec. 31, 2017 item $ / item	Dec. 31, 2016 $ / item
Quarterly distributions per depositary receipt (in dollars per receipt)			0.25	0.30				0.25				0.30	0.25
Quarterly distribution per unit (in dollars per unit)			7.50	9.00				7.50				9.00	7.50
Special distribution per unit (in dollars per unit)			24.00									28.50
Special distribution per depository receipt (in dollars per receipt)			0.80									0.95
Earnings per depository receipt
Net Income per Depositary Receipt (in dollars per receipt)				0.45	0.23	0.67	0.51	0.41	0.32	0.26	0.33	1.86	1.32
Limited Partner
Number of classes of partners | item												2
General Partnership
Number of classes of partners | item												1
Fixed distribution percentage of unit holders												1.00%
Class A
Fixed distribution percentage of unit holders												80.00%
Class B
Fixed distribution percentage of unit holders												19.00%
Class A
Forward split of depositary receipts		3
Exchange ratio of depositary receipts for partnership units before adjustment		10
Exchange ratio of depositary receipts for partnership units after adjustment		30
Number of units in each depository receipt		0.03333
Earnings per depository receipt
Net Income per Depositary Receipt (in dollars per receipt)												1.86	1.32
Distributions per Depositary Receipt (in dollars per share)			1.80	2.15				1.80				2.15	1.80
Class A | Subsequent event
Quarterly distribution per unit approved (in dollars per unit)	9.00
Quarterly distributions per depositary receipt (in dollars per receipt)	0.30
Class B
Fixed distribution percentage of unit holders												19.00%

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TREASURY UNITS (Details)		12 Months Ended			113 Months Ended
	Mar. 10, 2015 shares	Dec. 31, 2017 USD ($) $ / item shares	Dec. 31, 2016 USD ($) $ / item shares	Dec. 31, 2015 USD ($) shares	Dec. 31, 2016 USD ($) $ / item shares	Aug. 20, 2007 shares
Treasury units		55,839
Period for repurchase of depository receipts	5 years
Depository receipts authorized to be repurchased	2,000,000					300,000
Number of depository receipts repurchased					1,365,306
Repurchase price of depository receipts (in dollars per receipt) | $ / item					27.14
Units repurchased (in shares)		23	965	2,279
Total cost of repurchase | $		$ 42,548	$ 1,634,945	$ 3,429,953	$ 40,274,000
General Partnership
Treasury units		559
Fixed distribution percentage of unit holders		1.00%
Number of depository receipts repurchased					162
Total cost of repurchase | $		$ 426	$ 16,181	$ 33,878
Treasury Units
Units repurchased (in shares)		23	965	2,279
Class A
Fixed distribution percentage of unit holders		80.00%
Repurchase price of units (in dollars per unit) | $ / item					814.20
Total cost of repurchase | $		$ 34,038	$ 1,311,328	$ 2,752,393
Class B
Fixed distribution percentage of unit holders		19.00%
Number of depository receipts repurchased					3,072
Total cost of repurchase | $		$ 8,084	$ 307,436	$ 643,682
Class A
Treasury units		44,671
Repurchase price of depository receipts (in dollars per receipt) | $ / item		62.00	55.89
Repurchase price of units (in dollars per unit) | $ / item		1,860.00	1,676.70
Class A | Limited Partner
Total cost of repurchase | $		$ 34,038	$ 1,311,328
Class B
Treasury units		10,609
Fixed distribution percentage of unit holders		19.00%
Class B | Limited Partner
Total cost of repurchase | $		$ 8,084
Class B | General Partnership
Repurchase price of units (in dollars per unit) | $ / item					926.26
Treasury Units | General Partnership
Units repurchased (in shares)		0.2	10
Treasury Units | Class A | Limited Partner
Number of depository receipts repurchased			23,159
Treasury Units | Class B | Limited Partner
Units repurchased (in shares)		4.3	183

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COMMITMENTS AND CONTINGENCIES (Details) - 62 Boylston Street in Boston, MA	12 Months Ended
	Dec. 31, 2017 USD ($)	Nov. 19, 2016 item
Loss Contingencies [Line Items]
Number of apartments damaged | item		24
Proceeds from Insurance | $	$ 329,000

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RENTAL INCOME (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
RENTAL INCOME
Percentage of rental income related to residential apartments and condominium units with leases of one year or less	93.00%
Maximum period of non-cancelable operating lease	1 year
Percentage of rental income related to commercial properties	7.00%
Minimum future rental income
2018	$ 2,623,000
2019	2,131,000
2020	1,767,000
2021	1,325,000
2022	565,000
Thereafter	1,159,000
Commercial Property Leases	9,570,000
Aggregate contingent rentals from continuing operations	$ 642,000	$ 616,000	$ 683,000

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RENTAL INCOME (Concentration) (Details)	12 Months Ended
	Dec. 31, 2017
Commercial rental income | Major tenant | Staples and Trader Joes | WRF Associates LLC Strip Mall Framingham, Massachusetts
Concentration Risk
Concentration risk percentage	29.00%

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RENTAL INCOME (Commercial Leases) (Details)	12 Months Ended
	Dec. 31, 2017 USD ($) ft² item
RENTAL INCOME
Annual base rent for expiring leases | $	$ 2,972,087
Total square feet for expiring leases | ft²	108,043
Total number of leases expiring | item	46
Percentage of annual base rent for expiring leases	100.00%
Through December 31, 2018
RENTAL INCOME
Annual base rent for expiring leases | $	$ 499,878
Total square feet for expiring leases | ft²	19,724
Total number of leases expiring | item	14
Percentage of annual base rent for expiring leases	17.00%
Through December 31, 2019
RENTAL INCOME
Annual base rent for expiring leases | $	$ 576,710
Total square feet for expiring leases | ft²	20,838
Total number of leases expiring | item	11
Percentage of annual base rent for expiring leases	19.00%
Through December 31, 2020
RENTAL INCOME
Annual base rent for expiring leases | $	$ 185,494
Total square feet for expiring leases | ft²	4,461
Total number of leases expiring | item	6
Percentage of annual base rent for expiring leases	6.00%
Through December 31, 2021
RENTAL INCOME
Annual base rent for expiring leases | $	$ 829,156
Total square feet for expiring leases | ft²	40,323
Total number of leases expiring | item	6
Percentage of annual base rent for expiring leases	29.00%
Through December 31, 2022
RENTAL INCOME
Annual base rent for expiring leases | $	$ 486,772
Total square feet for expiring leases | ft²	12,218
Total number of leases expiring | item	6
Percentage of annual base rent for expiring leases	16.00%
Through December 31, 2023
RENTAL INCOME
Annual base rent for expiring leases | $	$ 157,443
Total square feet for expiring leases | ft²	4,771
Total number of leases expiring | item	1
Percentage of annual base rent for expiring leases	5.00%
Through December 31, 2024
RENTAL INCOME
Annual base rent for expiring leases | $	$ 94,184
Total square feet for expiring leases | ft²	1,858
Total number of leases expiring | item	1
Percentage of annual base rent for expiring leases	3.00%
Through December 31, 2025
RENTAL INCOME
Percentage of annual base rent for expiring leases	0.00%
Through December 31, 2026
RENTAL INCOME
Percentage of annual base rent for expiring leases	0.00%
Through December 31, 2027
RENTAL INCOME
Percentage of annual base rent for expiring leases	0.00%
Through December 31, 2028
RENTAL INCOME
Percentage of annual base rent for expiring leases	0.00%
Through December 31, 2029
RENTAL INCOME
Annual base rent for expiring leases | $	$ 142,450
Total square feet for expiring leases | ft²	3,850
Total number of leases expiring | item	1
Percentage of annual base rent for expiring leases	5.00%

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RENTAL INCOME (Rent Receivable) (Details) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
RENTAL INCOME
Allowance for doubtful rent receivable	$ 644,000	$ 523,000
Recognizing rental income from non-cancelable commercial leases with future rental increases on a straight-line basis	116,000
Deferred rental concession	$ 118,000

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CASH FLOW INFORMATION (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Cash paid for interest	$ 10,589,000	$ 9,942,000	$ 9,838,000
Cash paid for state income taxes	$ 61,000	$ 47,000	32,000
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts
Non-cash financing activities in connection with acquisition			$ 25,000,000

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FAIR VALUE MEASUREMENTS (Details) - USD ($)	Dec. 31, 2017	Dec. 31, 2016
Mortgage Notes Payable
Carrying Amount	$ 233,221,258	$ 212,709,080
Estimated Fair Value	237,895,708	219,086,450
Partially owned properties
Mortgage Notes Payable
Carrying Amount	124,145,012	130,152,297
Estimated Fair Value	$ 125,519,974	$ 133,991,269

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TAXABLE INCOME AND TAX BASIS (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
TAXABLE INCOME AND TAX BASIS
Taxable net income									$ 5,438,000
Excess amount of statement income over taxable income									1,500,000
Excess amount of cumulative statement basis over cumulative taxable basis	$ 1,532,000								1,532,000
Excess amount of statement income from joint venture investments over taxable income									5,000,000
Reconciliation of GAAP net income to taxable income
Financial statement ("book") net income	$ 1,688,270	$ 871,720	$ 2,483,707	$ 1,894,234	$ 1,528,755	$ 1,210,747	$ 980,586	$ 1,230,764	6,937,931	$ 4,950,852	$ 3,772,565
Book/Tax differences from depreciation and amortization									(3,097,000)	(1,411,000)	(2,513,000)
Book/Tax differences on tax free exchanges									(1,344,000)	(1,257,000)	(501,000)
Book/Tax differences from Investment Properties										279,000	74,000
Increase (Decrease) in prepaid rent and allowances									253,000	375,000	413,000
Other											6,000
Taxable income (loss)									$ 5,438,000	$ 4,893,000	$ 2,106,000

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Details)	12 Months Ended
	Dec. 31, 2017 item
Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of limited partnerships and limited liability companies in which the entity has invested	9
Number of partnerships investing in commercial property	3
Hamilton Company/Management Company
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of employees having ownership interest in the investment properties	5
Minimum | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	40.00%
Minimum | Harold Brown | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest of related party (as a percent)	43.20%
Maximum | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	50.00%
Maximum | Harold Brown | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest of related party (as a percent)	56.00%

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Dexter) (Details)		1 Months Ended
	Oct. 28, 2009 USD ($) item	Oct. 31, 2009	Feb. 28, 2007 USD ($)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 USD ($) item	Oct. 03, 2005 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 7,212,044	$ 8,336,505	$ 7,819,162
Number of units | item						1,033
Outstanding amount of mortgage				233,221,258	$ 212,709,080
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage				$ 233,221,000
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture	$ 15,925,000					$ 3,862,912
Ownership interest (as a percent)	40.00%				40.00%	40.00%
Number of units | item				409	409	409
Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture						$ 841,266	$ 2,500,000,000,000
Ownership interest (as a percent)					50.00%	50.00%	50.00%
Number of units | item				48	48	48	168
Interest rate (as a percent)			5.57%
Period for which the entity is required to make interest only payments			5 years
Term of note			10 years
Amortization period of debt			30 years
Purchase price of investments							$ 30,875,000
Borrowings			$ 4,750,000
Dexter Park | Mortgage, 5.57%, Due 2019
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)	5.57%
Period for which the entity is required to make interest only payments		2 years
Amortization period of debt	30 years
Outstanding amount of mortgage				$ 82,004,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item						1,030
Residential buildings | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				409	409	409
Residential buildings | Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				48	48	48
Residential buildings | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item	409

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Bay Apts and Sales) (Details)	12 Months Ended
	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture | $	$ 7,212,044	$ 8,336,505	$ 7,819,162
Number of units			1,033
Number of units sold			242
Number of units retained for long-term investment			(786)
Outstanding amount of mortgage | $	$ 233,221,258	$ 212,709,080
Unsold units			5
Hamilton Bay Sales and Hamilton Bay Apartments
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units	19
Number of units under a purchase and sale agreement	6
Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units sold	1
Gain on the sale of real estate | $	$ 133,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units			1,030
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage | $	$ 233,221,000
Mortgages payable | Minimum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)	3.24%
Mortgages payable | Maximum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)	5.97%

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Essex) (Details)				12 Months Ended
	Sep. 30, 2015 USD ($)	Sep. 28, 2015 USD ($)	Mar. 07, 2005 USD ($) item	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 7,212,044	$ 8,336,505	$ 7,819,162
Number of units | item						1,033
Distribution to the Partnership				7,985,835	6,729,679	$ 3,785,883
Mortgage Notes Payable				$ 233,221,258	$ 212,709,080
Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 2,000,000
Ownership interest (as a percent)			50.00%
Purchase price of real estate properties			$ 14,300,000
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)					50.00%	50.00%
Number of units | item				49	49	49
Capital contributions		$ 100,000
Distribution to the Partnership	$ 978,193
Hamilton Essex 81 | Maximum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Carrying value	0
Hamilton Essex Development
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture						$ 1,316,782
Ownership interest (as a percent)					50.00%	50.00%
Number of units | item				1	1	1
Capital contributions		978,193
Hamilton Essex Development, LLC and Hamilton Essex 81, LLC | Mortgage, March 2005
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Repayment of loan	$ 8,040,719
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage Notes Payable				$ 10,000,000
Hamilton Essex 81 | LIBOR | Mortgage, 2.18% Plus LIBOR, September 2015
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Margin over basis of interest rate (as a percent)	2.18%
Basis of interest rate	one month LIBOR
Hamilton Essex 81 | Hamilton Essex 81 | Mortgage, 2.18% Plus LIBOR, September 2015
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt	10 years
Hamilton Essex Development | Mortgage, March 2005
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Repayment of loan		$ 1,952,286
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item						1,030
Residential buildings | Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				48	48	48
Apartment | Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item			48
Commercial
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item						3
Commercial | Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item			1
Commercial | Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				1	1	1
Commercial | Hamilton Essex Development
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				1	1	1
Car parking lot | Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Capacity of real estate property (in cars per lot) | item			50
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage Notes Payable				$ 233,221,000
Mortgages payable | Maximum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)				5.97%

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton 1025) (Details)			12 Months Ended
	Jul. 08, 2016 USD ($)	Mar. 02, 2005 USD ($) item	Dec. 31, 2017 USD ($) item	Jan. 31, 2018 item	Dec. 31, 2016 USD ($) item	Feb. 01, 2016 item	Dec. 31, 2015 USD ($) item	Feb. 01, 2015 item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture | $			$ 7,212,044		$ 8,336,505		$ 7,819,162
Number of units							1,033
Number of units sold							242
Unsold units							5
Number of units retained for long-term investment							(786)
Outstanding amount of mortgage | $			233,221,258		$ 212,709,080
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage | $			$ 233,221,000
Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture | $		$ 2,352,000					$ 129,305
Ownership interest (as a percent)		50.00%			50.00%		50.00%
Number of units		176	176		176		176
Number of units sold		127				159	127	139
Unsold units			20		37	17
Number of units retained for long-term investment		49	18		0		(48)
Capital contributions | $	$ 2,359,500
Number of units under a purchase and sale agreement			8
Purchase price of investments | $		$ 23,750,000
Gain on sale of assets | $			$ 2,380,000
Hamilton 1025 | Subsequent event
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units sold				1
Hamilton 1025 | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt		10 years
Interest rate (as a percent)		5.67%
Period for which the entity is required to make interest only payments		5 years
Amortization period of debt		30 years
Borrowings | $		$ 5,000,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units							1,030
Residential buildings | Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units			175		175		175

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Minuteman) (Details)		1 Months Ended		12 Months Ended
	Sep. 12, 2016 USD ($)	Jan. 31, 2007 USD ($)	Oct. 31, 2004 USD ($)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 USD ($) item	Dec. 31, 2006 USD ($)	Sep. 30, 2004 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 7,212,044	$ 8,336,505	$ 7,819,162
Number of units | item						1,033
Distribution to the Partnership				7,985,835	6,729,679	$ 3,785,883
Outstanding amount of mortgage				$ 233,221,258	$ 212,709,080
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture						$ 548,448		$ 5,075,000
Ownership interest (as a percent)					50.00%	50.00%		50.00%
Number of units | item				42	42	42		42
Cash contribution by the entity towards loan							$ 1,250,000
Outstanding amount of mortgage				$ 6,000,000
Hamilton Minuteman | Mortgage, 5.67%, January 2007
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt			10 years
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Distribution to the Partnership			$ 3,775,000
Hamilton Minuteman | Mortgage, October 2004
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount			$ 8,025,000
Hamilton Minuteman | Mortgage, 5.67%, January 2007
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount		$ 5,500,000
Term of debt		10 years
Interest rate (as a percent)		5.67%
Period for which the entity is required to make interest only payments		5 months
Amortization period of debt		30 years
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item						1,030
Residential buildings | Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				42	42	42
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage				$ 233,221,000
Mortgages payable | Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Distribution to the Partnership	$ 385,000
Mortgage amount	6,000,000
Amount of mortgage paid off	5,158,000
Refinancing costs	$ 123,000
Interest rate (as a percent)	3.71%
Period for which the entity is required to make interest only payments	15 years

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton on Main) (Details)	1 Months Ended	12 Months Ended
	Aug. 31, 2014 USD ($)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 USD ($) item	Dec. 31, 2005 USD ($) item	May 31, 2008 item	Aug. 31, 2004 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 7,212,044	$ 8,336,505	$ 7,819,162
Number of units | item				1,033
Number of units sold | item				242
Outstanding amount of mortgage		233,221,258	212,709,080
Distribution to the Partnership		$ 7,985,835	$ 6,729,679	$ 3,785,883
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 832,780			$ 8,000,000
Ownership interest (as a percent)			50.00%	50.00%			50.00%
Number of units | item		148	148	148			280
Outstanding amount of mortgage		$ 16,900,000
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units sold | item						137
Distribution to the Partnership	$ 850,000
Hamilton on Main Apts | Mortgage, 5.18%, 2005
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt					10 years
Number of buildings | item					3
Interest rate (as a percent)					5.18%
Period for which the entity is required to make interest only payments					3 years
Amortization period of debt					30 years
Term excluding period for which interest only payments to be made					7 years
Net proceeds after funding escrow accounts and closing costs					$ 16,700,000
Repayment of loan	$ 15,205,000
Hamilton on Main Apts | Mortgage, 4.34%, August 2014
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt	10 years
Interest rate (as a percent)	4.34%
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				1,030
Residential buildings | Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item		148	148	148
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage		$ 233,221,000

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (345 Franklin) (Details)	1 Months Ended	12 Months Ended
	Jun. 30, 2013 USD ($)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 USD ($) item	Nov. 30, 2001 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 7,212,044	$ 8,336,505	$ 7,819,162
Number of units | item				1,033
Distribution to the Partnership		7,985,835	6,729,679	$ 3,785,883
Outstanding amount of mortgage		233,221,258	$ 212,709,080
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage		$ 233,221,000
Maximum | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)		5.97%
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Distribution to the Partnership	$ 1,610,000
345 Franklin | Mortgage, 3.87%, June 2013
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt	15 years
Interest rate (as a percent)	3.87%
Period for which the entity is required to make interest only payments	3 years
Amortization period of debt	30 years
Outstanding amount of mortgage		$ 9,743,000
345 Franklin | Mortgage, Paid off June 2013
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Repayment of loan	$ 6,776,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item				1,030
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture					$ 1,533,000
Ownership interest (as a percent)			50.00%	50.00%	50.00%
Number of units | item		40	40	40	40
345 Franklin | Maximum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Carrying value	$ 0
345 Franklin | Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item		40	40	40

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Balance Sheet) (Details)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Feb. 01, 2016 item	Dec. 31, 2015 USD ($) item	Feb. 01, 2015 item	Oct. 28, 2009 USD ($)	Oct. 03, 2005 USD ($) item	Mar. 02, 2005 USD ($) item	Sep. 30, 2004 USD ($) item	Aug. 31, 2004 USD ($) item	Nov. 30, 2001 USD ($) item
ASSETS
Rental Properties	$ 129,725,326	$ 142,881,344		$ 148,681,873
Assets held for sales	4,036,272
Cash & Cash Equivalents	2,183,047	2,081,578		1,873,377
Rent Receivable	216,622	265,073		96,371
Real Estate Tax Escrow	642,015	612,537		513,139
Prepaid Expenses & Other Assets	2,198,753	2,361,142		2,282,252
Total Assets	139,002,035	148,201,674		153,447,012
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	124,145,012			135,657,989
Accounts Payable and Accrued Expenses	1,087,616	1,033,761		1,254,230
Advance Rental Payments and Security Deposits	3,486,413	3,736,609		3,541,179
Total Liabilities	128,719,041	134,922,668		140,453,398
Partners' Capital	10,282,994	13,279,006		12,993,614
Total Liabilities and Capital	139,002,035	148,201,674		153,447,012
Investment in Unconsolidated Joint Ventures	7,212,044	8,336,505		7,819,162
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	(2,806,319)	(2,577,606)		(2,288,090)
Total Investment in Unconsolidated Joint Ventures (Net)	4,405,725	$ 5,758,899		$ 5,531,072
Total units/ condominiums
Total | item				1,033
Units to be retained | item				786
Units to be sold | item				247
Units sold | item				242
Unsold units | item				5
Units unsold with deposits for future sale | item				2
NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Investment in Unconsolidated Joint Ventures	$ 7,212,044
Residential buildings
Total units/ condominiums
Total | item				1,030
Commercial
Total units/ condominiums
Total | item				3
Investment Properties
Total units/ condominiums
Total | item	1,033	1,033
Units to be retained | item	689	689
Units to be sold | item	344	344
Units sold | item			310		258
Unsold units | item			34		38
Units unsold with deposits for future sale | item		6	11
Investment Properties | Residential buildings
Total units/ condominiums
Total | item	1,030	1,030
Investment Properties | Commercial
Total units/ condominiums
Total | item	3	3
Hamilton Essex 81
ASSETS
Rental Properties	$ 7,615,554	$ 8,011,942		$ 8,419,054
Cash & Cash Equivalents	293,801	167,953		200,185
Rent Receivable	21,478	25,604		9,058
Real Estate Tax Escrow	95,544	127,728		33,643
Prepaid Expenses & Other Assets	77,490	96,307		104,975
Total Assets	8,103,867	8,429,534		8,766,915
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	9,893,135			9,865,557
Accounts Payable and Accrued Expenses	57,811	59,227		69,413
Advance Rental Payments and Security Deposits	313,218	218,582		202,470
Total Liabilities	10,264,164	10,157,155		10,137,440
Partners' Capital	(2,160,297)	(1,727,621)		(1,370,525)
Total Liabilities and Capital	8,103,867	$ 8,429,534		$ 8,766,915
Partners' Capital % - NERA		50.00%		50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	$ (1,080,148)	$ (863,810)		$ (685,263)
Total units/ condominiums
Total | item	49	49		49
Units to be retained | item	49	49		49
Hamilton Essex 81 | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Hamilton Essex 81 | Residential buildings
Total units/ condominiums
Total | item	48	48		48
Hamilton Essex 81 | Commercial
Total units/ condominiums
Total | item	1	1		1
Hamilton Essex Development
ASSETS
Rental Properties	$ 2,598,297	$ 2,622,011		$ 2,618,666
Cash & Cash Equivalents	46,076	52,321		16,036
Prepaid Expenses & Other Assets	697	615		565
Total Assets	2,645,070	2,674,947		2,635,267
LIABILITIES AND PARTNERS' CAPITAL
Accounts Payable and Accrued Expenses	1,700	1,700		1,700
Total Liabilities	1,700	1,700		1,700
Partners' Capital	2,643,370	2,673,247		2,633,567
Total Liabilities and Capital	$ 2,645,070	$ 2,674,947		$ 2,635,267
Partners' Capital % - NERA		50.00%		50.00%
Investment in Unconsolidated Joint Ventures				$ 1,316,782
Total units/ condominiums
Total | item	1	1		1
Units to be retained | item	1	1		1
Hamilton Essex Development | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Investment in Unconsolidated Joint Ventures	$ 1,321,684	$ 1,336,623
Hamilton Essex Development | Commercial
Total units/ condominiums
Total | item	1	1		1
345 Franklin
ASSETS
Rental Properties	$ 6,325,676	$ 6,587,662		$ 6,780,019
Cash & Cash Equivalents	105,074	57,635		160,086
Rent Receivable	9,057	9,840		3,738
Real Estate Tax Escrow	18,171	18,570		15,322
Prepaid Expenses & Other Assets	53,813	50,553		37,088
Total Assets	6,511,791	6,724,260		6,996,253
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	9,672,846			9,916,769
Accounts Payable and Accrued Expenses	56,417	65,948		63,268
Advance Rental Payments and Security Deposits	234,870	236,679		221,871
Total Liabilities	9,964,133	10,151,852		10,201,908
Partners' Capital	(3,452,342)	(3,427,592)		(3,205,655)
Total Liabilities and Capital	$ 6,511,791	$ 6,724,260		$ 6,996,253
Partners' Capital % - NERA		50.00%		50.00%							50.00%
Investment in Unconsolidated Joint Ventures											$ 1,533,000
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture		$ (1,713,796)		$ (1,602,828)
Total units/ condominiums
Total | item	40	40		40							40
Units to be retained | item	40	40		40
345 Franklin | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	$ (1,726,171)
345 Franklin | Residential buildings
Total units/ condominiums
Total | item	40	40		40
Hamilton 1025
ASSETS
Rental Properties		$ 3,706,705		$ 4,939,620
Assets held for sales	$ 1,670,652
Cash & Cash Equivalents	86,495	144,831		27,721
Rent Receivable	7,129	10,568		4,164
Real Estate Tax Escrow				80,196
Prepaid Expenses & Other Assets	362,044	403,514		56,048
Total Assets	2,126,320	4,265,618		5,107,749
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable				4,728,751
Accounts Payable and Accrued Expenses	11,151	9,432		28,736
Advance Rental Payments and Security Deposits	11,649	61,883		91,649
Total Liabilities	22,800	71,315		4,849,136
Partners' Capital	2,103,520	4,194,303		258,613
Total Liabilities and Capital	$ 2,126,320	$ 4,265,618		$ 5,107,749
Partners' Capital % - NERA		50.00%		50.00%				50.00%
Investment in Unconsolidated Joint Ventures				$ 129,305				$ 2,352,000
Total units/ condominiums
Total | item	176	176		176				176
Units to be retained | item	(18)	0		48				(49)
Units to be sold | item	176	176		127
Units sold | item			159	127	139			127
Unsold units | item	20	37	17
Units unsold with deposits for future sale | item		5	7
Hamilton 1025 | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Investment in Unconsolidated Joint Ventures	$ 1,051,759	$ 2,097,151
Hamilton 1025 | Residential buildings
Total units/ condominiums
Total | item	175	175		175
Hamilton 1025 | Commercial
Total units/ condominiums
Total | item	1	1		1
Hamilton Bay Sales
ASSETS
Rental Properties		$ 140,635		$ 573,138
Cash & Cash Equivalents		18,576		7,728
Rent Receivable		2,452
Real Estate Tax Escrow		0
Prepaid Expenses & Other Assets		1,540		12,879
Total Assets		163,203		593,745
LIABILITIES AND PARTNERS' CAPITAL
Accounts Payable and Accrued Expenses		3,137		12,605
Advance Rental Payments and Security Deposits		1,822		5,799
Total Liabilities		4,959		18,404
Partners' Capital		158,244		575,341
Total Liabilities and Capital		$ 163,203		$ 593,745
Partners' Capital % - NERA		50.00%		50.00%
Investment in Unconsolidated Joint Ventures				$ 287,671
Total units/ condominiums
Total | item	120	120		120
Units to be sold | item	120	120		120
Units sold | item			120	115	119
Unsold units | item				5	1
Units unsold with deposits for future sale | item		1		2
Hamilton Bay Sales | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Investment in Unconsolidated Joint Ventures		$ 79,122
Hamilton Bay Sales | Residential buildings
Total units/ condominiums
Total | item	120	120		120
Hamilton Bay Apts
ASSETS
Rental Properties		$ 5,929,749		$ 6,174,512
Assets held for sales	$ 2,365,620
Cash & Cash Equivalents	448,952	923		545
Rent Receivable	9,199	5,520		241
Real Estate Tax Escrow		47,308		51,218
Prepaid Expenses & Other Assets	315,996	79,474		63,345
Total Assets	3,139,767	6,062,974		6,289,861
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable				4,497,183
Accounts Payable and Accrued Expenses	23,049	12,277		14,594
Advance Rental Payments and Security Deposits	19,365	82,693		95,552
Total Liabilities	42,414	4,525,544		4,607,329
Partners' Capital	3,097,353	1,537,430		1,682,532
Total Liabilities and Capital	$ 3,139,767	$ 6,062,974		$ 6,289,861
Partners' Capital % - NERA		50.00%		50.00%			50.00%
Investment in Unconsolidated Joint Ventures				$ 841,266			$ 2,500,000,000,000
Total units/ condominiums
Total | item	48	48		48			168
Units to be retained | item		0		48			(48)
Units to be sold | item	48	48
Units sold | item	29		31				120
Unsold units | item			17
Units unsold with deposits for future sale | item			4
Hamilton Bay Apts | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Investment in Unconsolidated Joint Ventures	$ 1,548,676	$ 768,714
Hamilton Bay Apts | Residential buildings
Total units/ condominiums
Total | item	48	48		48
Hamilton Minuteman
ASSETS
Rental Properties	$ 5,870,833	$ 6,165,266		$ 6,352,363
Cash & Cash Equivalents	88,436	47,795		39,184
Rent Receivable	2,121			668
Real Estate Tax Escrow	28,519	18,198		40,499
Prepaid Expenses & Other Assets	25,703	26,473		41,201
Total Assets	6,015,612	6,257,732		6,473,915
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	5,887,818			5,208,820
Accounts Payable and Accrued Expenses	49,540	50,643		55,116
Advance Rental Payments and Security Deposits	76,426	120,096		113,084
Total Liabilities	6,013,784	6,050,373		5,377,020
Partners' Capital	1,828	207,359		1,096,895
Total Liabilities and Capital	$ 6,015,612	$ 6,257,732		$ 6,473,915
Partners' Capital % - NERA		50.00%		50.00%					50.00%
Investment in Unconsolidated Joint Ventures				$ 548,448					$ 5,075,000
Total units/ condominiums
Total | item	42	42		42					42
Units to be retained | item	42	42		42
Hamilton Minuteman | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Investment in Unconsolidated Joint Ventures	$ 913	$ 103,679
Hamilton Minuteman | Residential buildings
Total units/ condominiums
Total | item	42	42		42
Hamilton on Main Apts
ASSETS
Rental Properties	$ 17,568,730	$ 17,773,858		$ 18,574,474
Cash & Cash Equivalents	145,149	95,294		235,748
Rent Receivable	14,879	6,133		11,684
Real Estate Tax Escrow	183,649	189,239		81,815
Prepaid Expenses & Other Assets	71,449	75,324		67,496
Total Assets	17,983,856	18,139,848		18,971,217
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	16,792,991			16,760,889
Accounts Payable and Accrued Expenses	137,282	157,812		216,091
Advance Rental Payments and Security Deposits	361,677	347,446		328,675
Total Liabilities	17,291,950	17,282,198		17,305,655
Partners' Capital	691,906	857,650		1,665,562
Total Liabilities and Capital	$ 17,983,856	$ 18,139,848		$ 18,971,217
Partners' Capital % - NERA		50.00%		50.00%						50.00%
Investment in Unconsolidated Joint Ventures				$ 832,780						$ 8,000,000
Total units/ condominiums
Total | item	148	148		148						280
Units to be retained | item	148	148		148
Hamilton on Main Apts | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	50.00%
Investment in Unconsolidated Joint Ventures	$ 345,952	$ 428,824
Hamilton on Main Apts | Residential buildings
Total units/ condominiums
Total | item	148	148		148
Dexter Park
ASSETS
Rental Properties	$ 89,746,236	$ 91,943,516		$ 94,250,027
Cash & Cash Equivalents	969,064	1,496,250		1,186,144
Rent Receivable	152,759	204,956		66,818
Real Estate Tax Escrow	316,132	211,494		210,446
Prepaid Expenses & Other Assets	1,291,561	1,627,342		1,898,655
Total Assets	92,475,752	95,483,558		97,612,090
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	81,898,222			84,680,020
Accounts Payable and Accrued Expenses	750,666	673,585		792,707
Advance Rental Payments and Security Deposits	2,469,208	2,667,408		2,482,079
Total Liabilities	85,118,096	86,677,572		87,954,806
Partners' Capital	7,357,656	8,805,986		9,657,284
Total Liabilities and Capital	$ 92,475,752	$ 95,483,558		$ 97,612,090
Partners' Capital % - NERA		40.00%		40.00%		40.00%
Investment in Unconsolidated Joint Ventures				$ 3,862,912		$ 15,925,000
Total units/ condominiums
Total | item	409	409		409
Units to be retained | item	409	409		409
Dexter Park | NERA 40%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA	40.00%
Investment in Unconsolidated Joint Ventures	$ 2,943,060	$ 3,522,393
Dexter Park | Residential buildings
Total units/ condominiums
Total | item	409	409		409

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Income) (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Oct. 28, 2009	Oct. 03, 2005	Mar. 02, 2005	Sep. 30, 2004	Aug. 31, 2004	Nov. 30, 2001
Revenues
Rental income	$ 23,376,262	$ 24,015,295	$ 23,526,780
Laundry and Sundry Income	162,523	170,727	151,950
Total Revenues	23,538,785	24,186,022	23,678,730
Expenses
Administrative	316,569	336,837	368,608
Depreciation and amortization	5,884,897	5,856,136	5,871,516
Management Fees	660,006	692,250	678,263
Operating	1,740,939	1,770,827	1,947,228
Renting	401,263	331,500	171,267
Repairs and Maintenance	2,959,112	2,994,069	2,546,726
Taxes and Insurance	2,963,065	2,892,136	2,750,187
Total Expenses	14,925,851	14,873,755	14,333,795
Income Before Other Income	8,612,934	9,312,267	9,344,935
Other Income (loss)
Interest Expense	(6,574,209)	(7,032,305)	(7,440,510)
Interest Income	0	10	14
Other Income (Expense)			96
Gain on Sale of Real Estate	6,141,265	1,661,425	169,093
Total Other Income (Loss)	(432,944)	(5,370,870)	(7,271,307)
Net Income (Loss)	8,179,990	3,941,397	2,073,625
Proportionate share of net income (loss)	3,905,827	1,785,827	868,574
NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	3,169,159	1,046,345	195,617
NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	736,668	739,482	672,958
Hamilton Essex 81
Revenues
Rental income	1,404,006	1,534,910	1,464,871
Laundry and Sundry Income	15,424	15,263	13,319
Total Revenues	1,419,430	1,550,173	1,478,190
Expenses
Administrative	26,760	31,400	28,849
Depreciation and amortization	456,728	452,186	439,046
Management Fees	59,873	63,880	63,226
Operating	70,847	103,761	102,872
Renting	37,474	26,731	11,246
Repairs and Maintenance	188,763	157,398	153,329
Taxes and Insurance	239,875	227,148	216,602
Total Expenses	1,080,320	1,062,504	1,015,170
Income Before Other Income	339,110	487,669	463,020
Other Income (loss)
Interest Expense	(349,303)	(289,041)	(432,732)
Interest Income	0
Gain on Sale of Real Estate	0
Total Other Income (Loss)	(349,303)	(289,041)	(432,732)
Net Income (Loss)	(10,193)	$ 198,628	$ 30,288
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%
Hamilton Essex 81 | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ (5,097)	$ 99,314	$ 15,144
Ownership interest (as a percent)	50.00%
Hamilton Essex 81 | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
Hamilton Essex Development
Revenues
Rental income	227,856	240,000	277,568
Laundry and Sundry Income	0
Total Revenues	227,856	240,000	277,568
Expenses
Administrative	26,065	1,740	2,000
Depreciation and amortization	2,830	2,830	2,829
Management Fees	9,114	9,600	11,114
Operating	0
Renting	0
Repairs and Maintenance	3,668	3,150	200
Taxes and Insurance	58,538	58,725	52,846
Total Expenses	100,215	76,045	68,989
Income Before Other Income	127,641	163,955	208,579
Other Income (loss)
Interest Expense	0		(46,283)
Interest Income	0
Gain on Sale of Real Estate	0
Total Other Income (Loss)	0		(46,283)
Net Income (Loss)	127,641	$ 163,955	$ 162,296
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%
Hamilton Essex Development | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 63,821	$ 81,978	$ 81,148
Ownership interest (as a percent)	50.00%
Hamilton Essex Development | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
345 Franklin
Revenues
Rental income	1,473,098	1,471,455	1,396,428
Laundry and Sundry Income	5,380	4,707	656
Total Revenues	1,478,478	1,476,162	1,397,084
Expenses
Administrative	25,686	34,512	35,071
Depreciation and amortization	348,502	348,169	368,775
Management Fees	61,513	60,545	57,604
Operating	70,599	72,280	80,873
Renting	36,194	22,395	15,815
Repairs and Maintenance	109,039	66,606	61,183
Taxes and Insurance	138,503	130,867	124,266
Total Expenses	790,036	735,374	743,587
Income Before Other Income	688,442	740,788	653,497
Other Income (loss)
Interest Expense	(393,193)	(397,726)	(398,414)
Interest Income	0
Gain on Sale of Real Estate	0
Total Other Income (Loss)	(393,193)	(397,726)	(398,414)
Net Income (Loss)	295,249	$ 343,062	$ 255,083
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%						50.00%
345 Franklin | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 147,625	$ 171,530	$ 127,543
Ownership interest (as a percent)	50.00%
345 Franklin | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
Hamilton 1025
Revenues
Rental income	352,888	798,710	962,511
Laundry and Sundry Income	0
Total Revenues	352,888	798,710	962,511
Expenses
Administrative	4,142	9,636	6,262
Depreciation and amortization	82,383	184,898	236,513
Management Fees	13,056	30,493	37,736
Operating	458	919	1,050
Renting	392	1,789	270
Repairs and Maintenance	227,346	296,423	314,409
Taxes and Insurance	99,646	161,984	166,842
Total Expenses	427,423	686,142	763,082
Income Before Other Income	(74,535)	112,568	199,429
Other Income (loss)
Interest Expense	(1,010)	(150,061)	(281,093)
Interest Income	0	10	14
Gain on Sale of Real Estate	2,379,763	1,324,174
Total Other Income (Loss)	2,378,753	1,174,123	(281,079)
Net Income (Loss)	2,304,218	$ 1,286,692	$ (81,651)
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%			50.00%
Hamilton 1025 | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 1,152,109	$ 643,346	$ (40,826)
Ownership interest (as a percent)	50.00%
Hamilton 1025 | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
Hamilton Bay Sales
Revenues
Rental income	5,557	40,290	99,413
Laundry and Sundry Income	0
Total Revenues	5,557	40,290	99,413
Expenses
Administrative	6,326	6,295	8,105
Depreciation and amortization	81,655	4,921	25,418
Management Fees	253	1,745	3,987
Operating	38	315	911
Renting	181
Repairs and Maintenance	3,326	22,054	43,559
Taxes and Insurance	1,850	9,236	20,461
Total Expenses	93,629	44,566	102,441
Income Before Other Income	(88,072)	(4,276)	(3,028)
Other Income (loss)
Interest Expense	(2)	(71)	(322)
Interest Income	0
Gain on Sale of Real Estate	133,297	337,251	169,093
Total Other Income (Loss)	133,295	337,180	168,771
Net Income (Loss)	45,223	$ 332,904	$ 165,743
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%
Hamilton Bay Sales | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 22,612	$ 166,451	$ 82,872
Ownership interest (as a percent)	50.00%
Hamilton Bay Sales | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
Hamilton Bay Apts
Revenues
Rental income	544,482	969,220	973,559
Laundry and Sundry Income	0
Total Revenues	544,482	969,220	973,559
Expenses
Administrative	8,617	10,768	8,592
Depreciation and amortization	181,152	298,503	295,176
Management Fees	19,947	38,258	38,640
Operating	4,239	2,358	1,173
Renting	241	4,354	2,986
Repairs and Maintenance	303,174	413,972	362,861
Taxes and Insurance	140,904	164,667	154,348
Total Expenses	658,274	932,880	863,776
Income Before Other Income	(113,792)	36,340	109,783
Other Income (loss)
Interest Expense	(41,957)	(261,440)	(265,636)
Interest Income	0
Gain on Sale of Real Estate	3,628,205
Total Other Income (Loss)	3,586,248	(261,440)	(265,636)
Net Income (Loss)	3,472,456	$ (225,100)	$ (155,854)
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%		50.00%
Hamilton Bay Apts | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 1,736,228	$ (112,550)	$ (77,927)
Ownership interest (as a percent)	50.00%
Hamilton Bay Apts | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
Hamilton Minuteman
Revenues
Rental income	1,024,570	992,980	942,539
Laundry and Sundry Income	2,620	1,326
Total Revenues	1,027,190	994,306	942,539
Expenses
Administrative	5,671	6,557	5,402
Depreciation and amortization	349,910	341,645	329,150
Management Fees	39,976	40,648	38,683
Operating	87,284	96,690	93,492
Renting	7,992	6,202	8,807
Repairs and Maintenance	81,647	84,307	82,769
Taxes and Insurance	127,947	121,365	124,393
Total Expenses	700,427	697,414	682,696
Income Before Other Income	326,763	296,892	259,843
Other Income (loss)
Interest Expense	(237,293)	(286,628)	(308,725)
Interest Income	0
Gain on Sale of Real Estate	0
Total Other Income (Loss)	(237,293)	(286,628)	(308,725)
Net Income (Loss)	89,470	$ 10,263	$ (48,883)
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%				50.00%
Hamilton Minuteman | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 44,735	$ 5,132	$ (24,442)
Ownership interest (as a percent)	50.00%
Hamilton Minuteman | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
Hamilton on Main Apts
Revenues
Rental income	3,359,971	3,236,490	3,093,045
Laundry and Sundry Income	37,968	40,720	44,911
Total Revenues	3,397,939	3,277,210	3,137,956
Expenses
Administrative	33,688	48,753	48,818
Depreciation and amortization	1,005,595	961,390	955,269
Management Fees	133,138	129,134	122,405
Operating	360,706	328,915	432,352
Renting	36,767	19,354	9,765
Repairs and Maintenance	606,570	558,988	393,665
Taxes and Insurance	436,266	476,185	341,990
Total Expenses	2,612,730	2,522,719	2,304,264
Income Before Other Income	785,209	754,491	833,692
Other Income (loss)
Interest Expense	(770,953)	(772,201)	(769,579)
Interest Income	0
Other Income (Expense)			96
Gain on Sale of Real Estate	0
Total Other Income (Loss)	(770,953)	(772,201)	(769,483)
Net Income (Loss)	14,256	$ (17,710)	$ 64,209
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		50.00%	50.00%					50.00%
Hamilton on Main Apts | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 7,127	$ (8,855)	$ 32,105
Ownership interest (as a percent)	50.00%
Hamilton on Main Apts | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 0
Dexter Park
Revenues
Rental income	14,983,834	14,731,240	14,316,846
Laundry and Sundry Income	101,131	108,711	93,064
Total Revenues	15,084,965	14,839,951	14,409,910
Expenses
Administrative	179,614	187,176	225,509
Depreciation and amortization	3,376,142	3,261,594	3,219,340
Management Fees	323,136	317,947	304,868
Operating	1,146,768	1,165,589	1,234,505
Renting	282,022	250,675	122,378
Repairs and Maintenance	1,435,579	1,391,171	1,134,751
Taxes and Insurance	1,719,536	1,541,959	1,548,439
Total Expenses	8,462,797	8,116,111	7,789,790
Income Before Other Income	6,622,168	6,723,840	6,620,120
Other Income (loss)
Interest Expense	(4,780,498)	(4,875,137)	(4,937,726)
Interest Income	0
Gain on Sale of Real Estate	0
Total Other Income (Loss)	(4,780,498)	(4,875,137)	(4,937,726)
Net Income (Loss)	1,841,670	$ 1,848,705	$ 1,682,394
Proportionate share of net income (loss)	0
Ownership interest (as a percent)		40.00%	40.00%	40.00%
Dexter Park | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	0
Dexter Park | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 736,668	$ 739,482	$ 672,958
Ownership interest (as a percent)	40.00%

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Mortgage Maturities) (Details) - USD ($)	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
3/31/2018	$ 1,874,727
3/31/2019	80,517,759
3/31/2020	205,532
3/31/2021	213,629
3/31/2022	222,044
Thereafter	41,613,565
Total	124,647,256	$ 130,152,298
Less: unamortized deferred financing costs	(502,244)
Debt maturities net of unamortized deferred financing costs	$ 124,145,012		$ 135,657,989
Weighted average interest rate (as a percent)	4.99%
Effective interest rate (as a percent)	5.08%
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Thereafter	$ 10,000,000
Total	10,000,000	9,879,346
Less: unamortized deferred financing costs	(106,865)
Debt maturities net of unamortized deferred financing costs	9,893,135		9,865,557
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
3/31/2018	190,248
3/31/2019	197,742
3/31/2020	205,532
3/31/2021	213,629
3/31/2022	222,044
Thereafter	8,713,565
Total	9,742,760	9,849,225
Less: unamortized deferred financing costs	(69,914)
Debt maturities net of unamortized deferred financing costs	9,672,846		9,916,769
Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Debt maturities net of unamortized deferred financing costs			4,728,751
Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Total		4,430,574
Debt maturities net of unamortized deferred financing costs			4,497,183
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Thereafter	6,000,000
Total	6,000,000	5,879,634
Less: unamortized deferred financing costs	(112,182)
Debt maturities net of unamortized deferred financing costs	5,887,818		5,208,820
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Thereafter	16,900,000
Total	16,900,000	16,776,940
Less: unamortized deferred financing costs	(107,009)
Debt maturities net of unamortized deferred financing costs	16,792,991		16,760,889
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
3/31/2018	1,684,479
3/31/2019	80,320,017
Total	82,004,496	$ 83,336,579
Less: unamortized deferred financing costs	(106,274)
Debt maturities net of unamortized deferred financing costs	$ 81,898,222		$ 84,680,020

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Details)										1 Months Ended			12 Months Ended
	Mar. 01, 2017 USD ($)	Sep. 12, 2016 USD ($)	Jul. 08, 2016 USD ($)	Sep. 30, 2015 USD ($)	Oct. 28, 2009 USD ($) item	Mar. 07, 2005 USD ($) item	Mar. 02, 2005 USD ($) item	Sep. 30, 2004 USD ($) item	Aug. 31, 2004 USD ($) item	Aug. 31, 2014 USD ($)	Feb. 28, 2007 USD ($)	Oct. 31, 2004 USD ($)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 USD ($) item	Jan. 31, 2018 item	Feb. 01, 2016 item	Feb. 01, 2015 item	May 31, 2008 item	Dec. 31, 2006 USD ($)	Oct. 03, 2005 USD ($) item	Nov. 30, 2001 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture | $													$ 7,212,044	$ 8,336,505	$ 7,819,162
Outstanding amount of mortgage | $													233,221,258	212,709,080
Number of units															1,033
Number of units retained for long-term investment															(786)
Number of units sold															242
Interest paid | $													10,589,000	9,942,000	$ 9,838,000
Units to be sold															247
Distribution to the Partnership | $													7,985,835	$ 6,729,679	$ 3,785,883
Carrying value of investment to discontinue applying the equity method | $													0
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage | $													$ 233,221,000
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)					40.00%									40.00%	40.00%
Investments in joint venture | $					$ 15,925,000										$ 3,862,912
Number of units													409	409	409
Number of units retained for long-term investment													(409)	(409)	(409)
Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)														50.00%	50.00%						50.00%
Investments in joint venture | $															$ 841,266						$ 2,500,000,000,000
Number of units													48	48	48						168
Number of units retained for long-term investment														0	(48)						48
Number of units sold													29				31				120
Interest rate (as a percent)											5.57%
Period for which the entity is required to make interest only payments											5 years
Amortization period of debt											30 years
Purchase price of investments | $																					$ 30,875,000
Capital contributions | $	$ 2,222,000
Borrowings | $											$ 4,750,000
Gain on Sale of Real Estate | $													$ 3,628,000
Units to be sold													48	48
Hamilton Bay Apts | Subsequent event
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units sold																2
Hamilton Bay Sales
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)														50.00%	50.00%
Investments in joint venture | $															$ 287,671
Number of units													120	120	120
Number of units sold															115		120	119
Units to be sold													120	120	120
Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)						50.00%
Investments in joint venture | $						$ 2,000,000
Purchase price of real estate properties | $						$ 14,300,000
Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)							50.00%							50.00%	50.00%
Investments in joint venture | $							$ 2,352,000								$ 129,305
Number of units							176						176	176	176
Number of units retained for long-term investment							49						18	0	(48)
Number of units sold							127								127		159	139
Purchase price of investments | $							$ 23,750,000
Capital contributions | $			$ 2,359,500
Units to be sold													176	176	127
Hamilton 1025 | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)							5.67%
Period for which the entity is required to make interest only payments							5 years
Amortization period of debt							30 years
Borrowings | $							$ 5,000,000
Term of debt							10 years
Hamilton 1025 | Subsequent event
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units sold																1
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)								50.00%						50.00%	50.00%
Investments in joint venture | $								$ 5,075,000							$ 548,448
Outstanding amount of mortgage | $													$ 6,000,000
Number of units								42					42	42	42
Number of units retained for long-term investment													(42)	(42)	(42)
Cash contribution by the entity towards loan | $																				$ 1,250,000
Hamilton Minuteman | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount | $		$ 6,000,000
Interest rate (as a percent)		3.71%
Period for which the entity is required to make interest only payments		15 years
Repayment of loan | $		$ 5,158,000
Distribution to the Partnership | $		$ 385,000
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)									50.00%					50.00%	50.00%
Investments in joint venture | $									$ 8,000,000						$ 832,780
Outstanding amount of mortgage | $													$ 16,900,000
Number of units									280				148	148	148
Number of units retained for long-term investment													(148)	(148)	(148)
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)														50.00%	50.00%							50.00%
Investments in joint venture | $																						$ 1,533,000
Number of units													40	40	40							40
Number of units retained for long-term investment													(40)	(40)	(40)
Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of limited partnerships and limited liability companies in which the entity has invested													9
Number of partnerships investing in commercial property													3
Number of units													1,033	1,033
Number of units retained for long-term investment													(689)	(689)
Number of units sold																	310	258
Units to be sold													344	344
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Purchase price of real estate properties | $					$ 129,500,000
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage | $													$ 10,000,000
Hamilton Essex 81 | Mortgage, 2.18% Plus LIBOR, September 2015
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount | $				$ 10,000,000
Hamilton Essex 81 | Mortgage, 2.18% Plus LIBOR, September 2015 | LIBOR
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Margin over basis of interest rate (as a percent)				2.18%
Basis of interest rate				one month LIBOR
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units sold																			137
Purchase price of real estate properties | $									$ 56,000,000
Distribution to the Partnership | $										$ 850,000
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Purchase price of real estate properties | $								$ 10,100,000
Distribution to the Partnership | $												$ 3,775,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units															1,030
Residential buildings | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													409	409	409
Residential buildings | Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													48	48	48
Residential buildings | Hamilton Bay Sales
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													120	120	120
Residential buildings | Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													175	175	175
Residential buildings | Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													42	42	42
Residential buildings | Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													148	148	148
Residential buildings | 345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													40	40	40
Residential buildings | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													1,030	1,030
Residential buildings | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units					409
Apartment | Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units						48
Commercial
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units															3
Commercial | Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units						1
Commercial | Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													1	1	1
Commercial | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units													3	3
Car parking lot | Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Capacity of real estate property (in cars per lot)						50
Minimum | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)													3.24%
Minimum | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)													40.00%
Minimum | Harold Brown | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest of related party (as a percent)													43.20%
Maximum | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)													5.97%
Maximum | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)													50.00%
Maximum | Harold Brown | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest of related party (as a percent)													56.00%

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Details)							1 Months Ended					12 Months Ended
	Sep. 30, 2015 USD ($)	Sep. 28, 2015 USD ($)	Oct. 28, 2009 USD ($) item	Oct. 28, 2009 item	Sep. 30, 2004 USD ($)	Aug. 31, 2004 USD ($)	Aug. 31, 2014 USD ($)	Jun. 30, 2013 USD ($)	Oct. 31, 2009 USD ($)	Jan. 31, 2007 USD ($)	Oct. 31, 2004 USD ($)	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($) item	Dec. 31, 2015 USD ($) item	Dec. 31, 2005 USD ($) item	Feb. 01, 2016 item	Feb. 01, 2015 item	May 31, 2008 item	Mar. 31, 2005 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture												$ 7,212,044	$ 8,336,505	$ 7,819,162
Number of units | item														1,033
Outstanding amount of mortgage												233,221,258	212,709,080
Number of units sold | item														242
Number of units retained for long-term investment | item														(786)
Unsold units | item														5
Distribution to the Partnership												7,985,835	$ 6,729,679	$ 3,785,883
Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage												$ 233,221,000
Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of limited partnerships and limited liability companies in which the entity has invested | item												9
Number of partnerships investing in commercial property | item												3
Number of units | item												1,033	1,033
Number of units sold | item																310	258
Number of units retained for long-term investment | item												(689)	(689)
Unsold units | item																34	38
Hamilton Company/Management Company
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of employees having ownership interest in the investment properties | item												5
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Purchase price of real estate properties			$ 129,500,000
Dexter Park | Mortgage, 5.57%, Due 2019
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount									$ 89,914,000
Interest rate (as a percent)			5.57%	5.57%
Period for which the entity is required to make interest only payments									2 years
Amortization period of debt				30 years
Outstanding amount of mortgage												$ 82,004,000
Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units sold | item												1
Gain on the sale of real estate												$ 133,000
Hamilton Essex Development, LLC and Hamilton Essex 81, LLC | Mortgage, March 2005
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount																			$ 10,750,000
Repayment of loan	$ 8,040,719
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage												10,000,000
Hamilton Essex 81 | Mortgage, 2.18% Plus LIBOR, September 2015
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount	$ 10,000,000
Hamilton Essex 81 | LIBOR | Mortgage, 2.18% Plus LIBOR, September 2015
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Margin over basis of interest rate (as a percent)	2.18%
Basis of interest rate	one month LIBOR
Hamilton Essex Development | Mortgage, March 2005
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Repayment of loan		$ 1,952,286
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Purchase price of real estate properties					$ 10,100,000
Distribution to the Partnership											$ 3,775,000
Hamilton Minuteman | Mortgage, October 2004
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount											$ 8,025,000
Hamilton Minuteman | Mortgage, 5.67%, January 2007
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount										$ 5,500,000
Interest rate (as a percent)										5.67%
Period for which the entity is required to make interest only payments										5 months
Amortization period of debt										30 years
Term of debt										10 years
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Purchase price of real estate properties						$ 56,000,000
Number of units sold | item																		137
Distribution to the Partnership							$ 850,000
Hamilton on Main Apts | Mortgage, 5.18%, 2005
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount															$ 16,825,000
Interest rate (as a percent)															5.18%
Period for which the entity is required to make interest only payments															3 years
Amortization period of debt															30 years
Term of debt															10 years
Number of buildings | item															3
Repayment of loan							15,205,000
Term excluding period for which interest only payments to be made															7 years
Net proceeds after funding escrow accounts and closing costs															$ 16,700,000
Hamilton on Main Apts | Mortgage, 4.34%, August 2014
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount							$ 16,900,000
Interest rate (as a percent)							4.34%
Term of debt							10 years
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Distribution to the Partnership								$ 1,610,000
345 Franklin | Mortgage, 3.87%, June 2013
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Mortgage amount								$ 10,000,000
Interest rate (as a percent)								3.87%
Period for which the entity is required to make interest only payments								3 years
Amortization period of debt								30 years
Outstanding amount of mortgage												$ 9,743,000
Term of debt								15 years
345 Franklin | Mortgage, Paid off June 2013
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Repayment of loan								$ 6,776,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item														1,030
Residential buildings | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item												1,030	1,030
Residential buildings | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item			409	409
Commercial
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item														3
Commercial | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | item												3	3
Minimum | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)												3.24%
Minimum | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)												40.00%
Minimum | Harold Brown | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest of related party (as a percent)												43.20%
Maximum | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)												5.97%
Maximum | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)												50.00%
Maximum | Harold Brown | Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest of related party (as a percent)												56.00%

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SALES OF REAL ESTATES (Details) - Hamilton Green - USD ($)		12 Months Ended
	Aug. 03, 2016	Dec. 31, 2016
Gain on the sale of real estate property
Sale price	$ 1,000,000	$ 1,000,000
Net book value		(668,544)
Expense of sale		(227,013)
Gain on the sale of real estate		$ 104,443

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QUARTERLY FINANCIAL DATA (UNAUDITED) (Details)	3 Months Ended								12 Months Ended
	Dec. 31, 2017 USD ($) $ / shares $ / item	Sep. 30, 2017 USD ($) $ / shares $ / item	Jun. 30, 2017 USD ($) $ / shares $ / item	Mar. 31, 2017 USD ($) $ / shares $ / item	Dec. 31, 2016 USD ($) $ / shares $ / item	Sep. 30, 2016 USD ($) $ / shares $ / item	Jun. 30, 2016 USD ($) $ / shares $ / item	Mar. 31, 2016 USD ($) $ / shares $ / item	Dec. 31, 2017 USD ($) $ / shares $ / item	Dec. 31, 2016 USD ($) $ / shares $ / item	Dec. 31, 2015 USD ($) $ / shares
QUARTERLY FINANCIAL DATA (UNAUDITED)
Revenue	$ 13,874,185	$ 13,421,805	$ 12,787,791	$ 12,743,607	$ 12,745,657	$ 12,371,881	$ 12,254,264	$ 12,183,288	$ 52,827,388	$ 49,555,090	$ 45,480,714
Expenses	10,369,714	10,493,852	8,817,160	9,001,696	9,232,731	9,274,045	9,019,667	8,768,697	38,682,422	36,295,140	32,597,960
Income Before Other Income (Expense)	3,504,471	2,927,953	3,970,631	3,741,911	3,512,926	3,097,836	3,234,597	3,414,591	14,144,966	13,259,950	12,882,754
Other Expenses	(1,816,201)	(2,056,233)	(1,486,924)	(1,847,677)	(1,984,171)	(1,887,089)	(2,254,011)	(2,183,827)	(7,207,035)	(8,309,098)	(9,110,189)
Net Income	$ 1,688,270	$ 871,720	$ 2,483,707	$ 1,894,234	$ 1,528,755	$ 1,210,747	$ 980,586	$ 1,230,764	$ 6,937,931	$ 4,950,852	$ 3,772,565
Net Income per Unit before Discontinued Operations | $ / shares	$ 13.56	$ 7.01	$ 19.97	$ 15.23	$ 12.24	$ 9.69	$ 7.85	$ 9.84	$ 55.77	$ 39.62
Net Income per Unit (in dollars per unit) | $ / shares	$ 13.56	$ 7.01	$ 19.97	$ 15.23	$ 12.24	$ 9.69	$ 7.85	$ 9.84	$ 55.77	$ 39.62	$ 29.86
Income Per Depositary Receipt Before Discontinued Operations (in dollars per unit) | $ / item	0.45	0.23	0.67	0.51	0.41	0.32	0.26	0.33	1.86	1.32
Net Income Per Depositary Receipt (in dollars per receipt) | $ / item	0.45	0.23	0.67	0.51	0.41	0.32	0.26	0.33	1.86	1.32

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SUBSEQUENT EVENTS (Details)	Mar. 09, 2018 USD ($) item	Dec. 31, 2015 item
Subsequent events
Number of units | item		1,033
Subsequent event | Webster Green Apartments
Subsequent events
Number of units | item	79
Purchase price of real estate properties	$ 34,500,000
Amount paid into escrow	500,000
Mortgage assumed.	$ 21,500,000

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QUALIFYING ACCOUNTS (Details) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Valuation and Qualifying Accounts
Balance at Beginning of Period	$ 523,004	$ 372,828
Additions, Charged to Costs and Expenses		365,746
Deductions		215,570
Balance at end of Period		523,004	$ 372,828
Allowance for doubtful accounts
Valuation and Qualifying Accounts
Balance at Beginning of Period	523,004	372,828	366,105
Additions, Charged to Costs and Expenses	422,109		201,622
Deductions	301,123		194,899
Balance at end of Period	$ 643,990	$ 523,004	$ 372,828