10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019

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	04-2619298
(State or other jurisdiction of	(I.R.S. employer
incorporation or organization)	identification no.)
39 Brighton Avenue, Allston, Massachusetts	02134
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (617) 783-0039

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, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:	Trading Symbol	Name of each exchange on which registered:
Class A	NEN	NYSE MKT Exchange

As of May 3, 2019, there were 98,073 of the registrant’s Class A units (2,942,187 Depositary Receipts) of limited partnership issued and outstanding and 23,292 Class B units issued and outstanding.

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP

INDEX

PART I—FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018	4
	Consolidated Statements of Income for the Three Months Ended March 31, 2019 and 2018	5
	Consolidated Statements of Changes in Partners’ Capital for the Three Months ended March 31, 2019 and 2018	6
	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2019 and 2018	7
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.	Controls and Procedures	35
PART II—OTHER INFORMATION
Item 1.	Legal Proceedings	36
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
Item 3.	Defaults Upon Senior Securities	36
Item 4.	Mine Safety Disclosure	36
Item 5.	Other Information	37
Item 6.	Exhibits	37
SIGNATURES		39

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NEW ENGLAND REALTY ASSOCIATES, L.P.

PART 1 -- FINANCIAL INFORMATION

Item 1. Financial Statements

The accompanying unaudited consolidated balance sheets, statements of income, changes in partners’ capital, and cash flows and related notes thereto, have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and in conjunction with the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the disclosures required by GAAP for complete financial statements. The financial statements reflect all adjustments consisting only of normal, recurring adjustments, which are, in the opinion of management, necessary for a fair presentation for the interim periods.

The consolidated balance sheet as of December 31, 2018 has been derived from the audited consolidated balance sheet at that date but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

The aforementioned financial statements should be read in conjunction with the notes to the aforementioned financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements and notes thereto included in New England Realty Associates L.P.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

The results of operations for the three month period ended March 31, 2019 are not necessarily indicative of the results to be expected for the entire fiscal year or any other period.

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NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	March 31,		December 31,
	2019		2018
ASSETS		(Unaudited)
Rental Properties	$	227,660,057	$	230,511,263
Cash and Cash Equivalents		7,649,882		9,059,901
Rents Receivable		779,159		762,923
Real Estate Tax Escrows		471,913		495,824
Prepaid Expenses and Other Assets		4,812,005		4,219,749
Investments in Unconsolidated Joint Ventures		1,801,702		1,985,680
Total Assets	$	243,174,718	$	247,035,340
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable		251,953,066		252,370,843
Notes Payable		—		2,000,000
Distribution and Loss in Excess of Investment in Unconsolidated Joint Venture		18,858,645		18,351,562
Accounts Payable and Accrued Expenses		4,126,517		3,927,889
Advance Rental Payments and Security Deposits		6,468,073		6,009,056
Total Liabilities		281,406,301		282,659,350
Commitments and Contingent Liabilities (Notes 3 and 9)		—		—
Partners’ Capital 122,591 and 124,386 units outstanding in 2019 and 2018 respectively		(38,231,583)		(35,624,010)
Total Liabilities and Partners’ Capital	$	243,174,718	$	247,035,340

See notes to consolidated financial statements.

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NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended
	March 31,
	2019		2018
Revenues
Rental income	$	14,768,475	$	13,942,645
Laundry and sundry income		113,669		116,355
		14,882,144		14,059,000
Expenses
Administrative		612,757		539,145
Depreciation and amortization		3,682,678		3,507,091
Management fee		590,610		559,629
Operating		1,884,017		1,900,766
Renting		182,058		107,899
Repairs and maintenance		1,944,231		1,814,283
Taxes and insurance		2,034,106		1,868,483
		10,930,457		10,297,296
Income Before Other Income (Expense)		3,951,687		3,761,704
Other Income (Expense)
Interest income		179		164
Interest expense		(3,000,289)		(2,984,210)
Income  from investments in unconsolidated joint ventures		548,939		1,100,900
		(2,451,171)		(1,883,146)
Net Income	$	1,500,516	$	1,878,558
Net Income per Unit	$	12.21	$	15.10
Weighted Average Number of Units Outstanding		122,941		124,386

See notes to consolidated financial statements.

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NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNER’S CAPITAL

(Unaudited)

	Units							Partners’s Capital
	Limited		General		Treasury			Limited				General
	Class A	Class B	Partnership	Subtotal	Units	Total		Class A		Class B		Partnership		Total
Balance January 1, 2018	144,180	34,243	1,802	180,225	55,839	124,386		$	(28,280,285)	$	(6,683,147)	$	(351,745)	$	(35,315,177)
Distribution to Partners	—	—	—	—	—	—			(895,585)		(212,701)		(11,195)		(1,119,481)
Stock Buyback	—	—	—	—		—			—		—		—		—
Net Income	—	—	—	—	—	—			1,502,846		356,926		18,786		1,878,558
Balance March 31, 2018	144,180	34,243	1,802	180,225	55,839	124,386		$	(27,673,024)		(6,538,922)		(344,154)		(34,556,100)
Balance January 1 , 2019	144,180	34,243	1,802	180,225	55,839	124,386		$	(28,527,352)	$	(6,741,825)	$	(354,833)	$	(35,624,010)
Distribution to Partners	—	—	—	—	—	—			(941,882)		(223,697)		(11,774)		(1,177,353)
Stock Buyback				—	1,795	(1,795)	—		(2,344,601)		(556,828)		(29,307)		(2,930,736)
Net Income	—	—	—	—	—	—			1,200,413		285,098		15,005		1,500,516
Balance March 31, 2019	144,180	34,243	1,802	180,225	57,634	122,591		$	(30,613,422)	$	(7,237,252)	$	(380,909)	$	(38,231,583)

See notes to consolidated financial statements.

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NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended March 31,
	2019		2018
Cash Flows from Operating Activities
Net income	$	1,500,516	$	1,878,558
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		3,682,678		3,507,091
Amortization of deferred financing costs		54,843		51,541
(Income)  from investments in joint ventures		(548,939)		(1,100,900)
Change in operating assets and liabilities
Proceeds from unconsolidated joint ventures		425,000		1,770,000
(Increase) Decrease in rents receivable		(16,236)		(23,160)
Increase (Decrease) in accounts payable and accrued expense		198,628		(25,471)
Decrease   in real estate tax escrow		23,911		1,640
(Increase)  in prepaid expenses and other assets		(746,891)		(523,530)
Increase in advance rental payments and security deposits		459,025		87,257
Total Adjustments		3,532,019		3,744,468
Net cash provided by operating activities		5,032,535		5,623,026
Cash Flows From Investing Activities
Distribution in excess of investment in unconsolidated joint ventures		823,490		210,402
(Investment)  in unconsolidated joint ventures		(8,490)		(526,402)
Improvement of rental properties		(676,844)		(868,468)
Purchase of rental property		—		(13,213,294)
Net cash provided by (used in) investing activities		138,156		(14,397,762)
Cash Flows from Financing Activities
Payment of financing costs		—		(148,004)
Proceeds of mortgage notes payable		—		83,684
Proceeds of notes payable		—		8,000,000
Payment of note payable		(2,000,000)		—
Principal payments of mortgage notes payable		(472,621)		(452,900)
Stock buyback		(2,930,736)		—
Distributions to partners		(1,177,353)		(1,119,481)
Net cash provided by (used in) financing activities		(6,580,710)		6,363,299
Net (Decrease) Increase in Cash and Cash Equivalents		(1,410,019)		(2,411,437)
Cash and Cash Equivalents, at beginning of period		9,059,901		7,238,905
Cash and Cash Equivalents, at end of period	$	7,649,882	$	4,827,468

See notes to consolidated financial statements.

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NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(Unaudited)

  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 27 properties which include 19 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,711 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a 40 - 50%  interest in 8 residential and mixed use properties consisting of 690 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 eight 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: Investment 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 venture 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 some 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

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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 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.

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

9

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 $55,000 and $52,000 for the three months ended March 31, 2019 and 2018, 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 2019 or 2018 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: Partner’s Capital).

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 2019 or 2018. The Partnership makes its temporary cash investments with high-credit quality financial institutions. At March 31, 2019, 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 1.61%. At March 31, 2019 and December 31, 2018, respectively approximately $7,406,000, and $10,784,000 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 $62,969 and $44,381 for the three months ended March 31, 2019 and 2018, respectively.

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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 three months ended March 31, 2019 and 2018 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.

NOTE 2. RENTAL PROPERTIES 

As of March 31, 2019, the Partnership and its Subsidiary Partnerships owned 2,711 residential apartment units in 23 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 March 31, 2019, 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 eight residential and mixed use complexes (the “Investment Properties”) at March 31, 2019 with a total of 690 units, accounted for using the equity method of consolidation. See Note 14 for summary information on these investments.

Rental properties consist of the following:

	March 31, 2019		December 31, 2018		Useful Life
Land, improvements and parking lots	$	72,547,547	$	72,547,547	15	-	40	years
Buildings and improvements		221,837,652		221,697,939	15	-	40	years
Kitchen cabinets		12,247,767		12,134,519	5	-	10	years
Carpets		7,773,940		7,591,591	5	-	10	years
Air conditioning		603,149		603,149	5	-	10	years
Laundry equipment		349,071		327,643	5	-	7	years
Elevators		1,873,847		1,839,590	20	-	40	years
Swimming pools		444,629		444,629	10	-	30	years
Equipment		13,016,249		12,919,389	5	-	30	years
Motor vehicles		216,260		216,260			5	years
Fences		38,213		38,213	5	-	15	years
Furniture and fixtures		7,102,834		7,013,845	5	-	7	years
Smoke alarms		528,097		528,097	5	-	7	years
Total fixed assets		338,579,255		337,902,411
Less: Accumulated depreciation		(110,919,198)		(107,391,148)
	$	227,660,057	$	230,511,263

On March 29, 2018, Hamilton Highlands, LLC (“Hamilton Highlands”), a wholly-owned subsidiary of New England Realty Associates Limited Partnership (the “Partnership”), purchased Webster Green Apartments, a 79 unit apartment complex located at 755-757 Highland Avenue, Needham, Massachusetts.  The sale was consummated pursuant to the terms of a Purchase and Sale Contract by and between Webster Green Apartments, LLC, the prior owner of the Property, and The Hamilton Companies, Inc., an affiliate of the Partnership, which agreement was subsequently assigned by Hamilton to Hamilton Highlands.

In connection with the purchase, the Hamilton Highlands entered into an Assumption and Modification Agreement dated as of March 29, 2018 with Brookline Bank pursuant to which the Hamilton Highlands assumed a note

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dated as of January 14, 2016 in the principal amount of $21,500,000 and various agreements relating to the Note including a Mortgage, Assignment of Leases and Rents, Security Agreement, Fixture Filing dated as of January 14, 2016. The purchase price was $34,500,000, consisting of a payment of approximately $13,000,000 in cash and the assumption of the note and mortgage. Hamilton Highlands funded $5,000,000 of the cash portion of the purchase price out of cash reserves and the remaining $8,000,000 by drawing on an existing line of credit. The closing costs were approximately $141,000. From the purchase price, the Partnership allocated approximately $502,000 for in- place leases, and approximately $40,000 to the value of tenant relationships. These amounts are being amortized over 12 and 24 months respectively.

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 $591,000 and $560,000 for the three months ended March 31, 2019 and 2018, 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. During the three months ended March 31, 2019 and 2018, approximately $349,000 and $354,000, was charged to NERA for legal, accounting, construction, maintenance, brokerage fees, rental and architectural services and supervision of capital improvements. Of the 2019 expenses referred to above, approximately $108,000 consisted of repairs and maintenance, $90,000 of administrative expense and $1,000 for rental commissions. Approximately $150,000 of expenses for construction, architectural services and supervision of capital projects were capitalized in rental properties. Additionally in 2019, the Hamilton Company received approximately $316,000 from the Investment Properties of which approximately $163,000 was the management fee, approximately $121,000 for rental commissions, approximately $18,000 was for maintenance services, approximately $11,000 was for administrative services and approximately $3,000 for architectural services and supervision of capital projects. The management fee is equal to 4% of gross receipts of 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 $789,000 and $824,000 for the three months ended March 31, 2019 and 2018, 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 2018. For the three months ended March 31, 2019, the Partnership contributed $12,000 for the employer’s match portion to the plan. See Note 15.

Bookkeeping and accounting functions are provided by the Management Company’s accounting staff, which consists of approximately 14 people. During the three months ended March 31, 2019 and 2018, the Management Company charged the Partnership $31,250 ($125,000 per year) for bookkeeping and accounting services included in administrative expenses above.

The former President of the Management Company performed asset management consulting services and received an asset management fee from the Partnership. The Partnership did not have a written agreement with this individual. During the three months ended March  31, 2018 this individual received fees of $18,750. At June 29, 2018, the individual resigned his position.

The Partnership has invested in eight 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 the Estate of Harold Brown, and five current and previous employees of the Management Company. Harold Brown’s ownership interest was between 47.6% and 59%. See Note 14 for a description of the properties and their operations.

NOTE 4. OTHER ASSETS

Approximately $2,639,000, and $2,571,000 of security deposits are included in prepaid expenses and other assets at March 31, 2019 and December 31, 2018, respectively. The security deposits and escrow accounts are restricted cash.

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Included in prepaid expenses and other assets at March 31, 2019 and December 31, 2018 is approximately $494,000 and $477,000, respectively, held in escrow to fund future capital improvements.

Intangible assets on the acquisitions of Webster Green Apartments and Woodland Park Apartments are included in prepaid expenses and other assets. Intangible assets are approximately $18,000 net of accumulated amortization of approximately $1,093,000 and approximately $152,000 net of accumulated amortization of approximately $959,000 at March 31, 2019 and December 31, 2018, respectively.

Financing fees in association with the line of credit of approximately $68,000 and $78,000 are net of accumulated amortization of approximately $60,000 and $50,000 at March 31, 2019 and December 31, 2018 respectively.

NOTE 5. MORTGAGE NOTES PAYABLE

At March 31, 2019 and December 31, 2018, the mortgages payable consisted of various loans, all of which were secured by first mortgages on properties referred to in Note 2. At March 31, 2019, the interest rates on these loans ranged from 3.76% to 5.81%, payable in monthly installments aggregating approximately $1,139,000 including principal, to various dates through 2029. The majority of the mortgages are subject to prepayment penalties. At March 31, 2019, the weighted average interest rate on the above mortgages was 4.63%. The effective rate of 4.71% 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 $1,354,000 and $1,420,000 are net of accumulated amortization of approximately $1,363,000 and $1,298,000 at March  31, 2019 and December 31, 2018, respectively.

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

Approximate annual maturities at March 31, 2019 are as follows:

2020—current maturities	$	4,319,000
2021		2,049,000
2022		2,606,000
2023		67,098,000
2024		38,362,000
Thereafter		138,804,000
		253,238,000
Less: unamortized deferred financing costs		(1,285,000)
	$	251,953,000

On March 29, 2018, Hamilton Highlands, LLC (Hamilton Highlands), a wholly-owned subsidiary of New England Realty Associates Limited Partnership, purchased Webster Green Apartments, a 79 unit apartment complex located at 755-757 Highland Avenue, Needham, Massachusetts. The purchase was consummated pursuant to the terms of a Purchase and Sale Contract by and between Webster Green Apartments, LLC, the prior owner of the Property, and The Hamilton Companies, Inc., an affiliate of the Partnership, which agreement was subsequently assigned to Hamilton Highlands.  

In connection with the purchase, Hamilton Highlands entered into an Assumption and Modification Agreement dated as of March 29, 2018 with Brookline Bank pursuant to which Hamilton Highlands assumed a note dated as of January 14, 2016 in the principal amount of $21,500,000 and various agreements relating to the Note including a Mortgage, Assignment of Leases and Rents, Security Agreement, Fixture Filing dated as of January 14, 2016.  The purchase price was $34,500,000, consisting of a payment of approximately $13,000,000 in cash and the assumption of the Note and Mortgage. Hamilton Highlands funded $5,000,000 of the cash portion of the purchase price out of cash reserves and the remaining $8,000,000 by drawing on an existing line of credit. The closing costs were approximately $141,000.

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On March 12, 2018, the loan for 659 Worcester Road was refinanced with Brookline Bank in the amount of $6,083,683. The loan is due on March 12, 2023. Interest only until March 12, 2021. Commencing in April, 2021, monthly payments of principal and interest in the amount of $32,427 are being made based on an assumed amortization period of thirty (30) years. The loan bears a fixed annual rate equal to 4.87%.  The proceeds of the new loan were used to pay off the existing loan. The closing costs were approximately $69,000

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. 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.

On March 29, 2018, the Partnership drew down $8,000,000 in conjunction with the purchase of Webster Green Apartments.  On June 4, 2018, the Partnership paid down the credit line by $16,000,000 as a result of the proceeds from the refinancing of Hamilton Park Towers, LLC, also known as Dexter Park. In July, 2018, the Partnership paid down the line of credit by $4,000,000. In October of 2018, the Partnership paid down the line of credit by $3,000,000. In January 2019, the Partnership paid off  the $2,000,000 balance on the line of credit.

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 $12,000 in fees for the three months ended March 31, 2019.

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 March 31, 2019.

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 March 31, 2019, amounts received for prepaid rents of approximately $2,234,000 are included in cash and cash equivalents, and security deposits of approximately $2,639,000 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.

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In January 2019, the Partnership approved a quarterly distribution to its Class A Limited Partners and holders of Depositary Receipts of record as of March 15, 2019 and payable on March 31, 2019, of $9.60 per unit ($0.32 per receipt).

In 2018, regular quarterly distributions of $9.00 per unit ($0.30 per receipt) were paid in March, June, September and December.

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:

	Three Months Ended
	March 31,
	2019		2018
Net Income per Depositary Receipt	$	0.41	$	0.50
Distributions per Depositary Receipt	$	0.32	$	0.30

NOTE 8. TREASURY UNITS

Treasury Units at March 31, 2019 are as follows:

Class A	46,107
Class B	10,950
General Partnership	577
	57,634

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 from 1,500,000 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 March 31, 2019, the Partnership has repurchased 1,408,401 Depositary Receipts at an average price of $27.97 per receipt (or $839.10 per underlying Class A Unit), 3,413 Class B Units and 180 General Partnership Units, both at an average price of $996.79 per Unit, totaling approximately $43,205,000 including brokerage fees paid by the Partnership.

During the three months ended March 31, 2019, the Partnership purchased a total of 43,095 Depositary Receipts. The average price was $54.40 per receipt or $1,632.12 per unit. The total cost including commission was $2,344,601. The Partnership was required to repurchase 341 Class B Units and 18 General Partnership units at a cost of $556,828 and $29,307 respectively.

NOTE 9. COMMITMENTS AND CONTINGENCIES

From time to time, the Partnership is involved in various ordinary routine litigation incidental to its 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.

In February, 2019, a water pipe broke at Hamilton Oak in Brockton, MA. resulting in the evacuation of 40 apartments for approximately one week. The Partnership has insurance coverage on both the repairs and rental loss. As of March 31, 2019, the Partnership has received $75,000 on this claim, and has an estimated insurance recovery receivable of approximately $212,000, which is included on the prepaid expenses and other assets as of March 31, 2019.

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NOTE 10. RENTAL INCOME 

During the three months ended March 31, 2019, approximately 94% 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 6% was related to commercial properties, which have minimum future annual rental income on non-cancellable operating leases at March 31, 2019 as follows:

	Commercial
	Property Leases
2020	$	2,565,000
2021		2,299,000
2022		1,591,000
2023		946,000
2024		523,000
Thereafter		756,000
	$	8,680,000

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 $129,000 and $223,000  for the three months ended March 31, 2019 and 2018 respectively. Staples and Trader Joes, tenants at Staples Plaza, are approximately 36% 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 March 31,	expiring leases		for expiring leases	leases expiring	expiring leases
2020	$	454,412	22,400	12	16	%
2021		225,337	5,679	7	8	%
2022		1,143,867	47,854	10	39	%
2023		246,341	7,087	4	9	%
2024		658,784	19,209	8	22	%
2025		15,936	604	3	1	%
2026		—	—	—	—	%
2027		—	—	—	—	%
2028		—	—	—	—	%
2029		—	—	—	—	%
2030		142,450	3,850	1	5	%
Totals	$	2,887,127	106,683	45	100	%

Rents receivable are net of an allowance for doubtful accounts of approximately $369,000 and $532,000 at March 31, 2019 and December 31, 2018. Included in rents receivable at March 31, 2019 is approximately $69,000 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 and Staples Plaza in Massachusetts.

Rents receivable at March 31, 2019 also includes approximately $82,000 representing the deferral of rental concession primarily related to the residential properties.

NOTE 11. CASH FLOW INFORMATION

During the three months ended March 31, 2019 and 2018, cash paid for interest was approximately $2,944,000, and $3,010,000 respectively.  Cash paid for state income taxes was approximately $48,000 and $47,000 during the three months ended March 31, 2019 and 2018 respectively. Additionally, at March 31,2018, the Partnership was involved in a non-cash financing activity of approximately $21,000,000 in connection with the purchase of Webster Green Apartments.

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NOTE 12. FAIR VALUE MEASUREMENTS

Fair Value Measurements on a Recurring Basis

At March 31, 2019 and December 31, 2018, 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 March 31, 2019 and December 31, 2018 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 March 31, 2019 and December 31, 2018, 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 March 31, 2019 and December 31, 2018, 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 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 mortgage 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 March 31, 2019	*	$	251,953,066	$	235,100,502
At December 31, 2018	*	$	252,370,843	$	233,362,501
Investment Properties
At March 31, 2019	*	$	166,471,296	$	163,347,932
At December 31, 2018	*	$	166,492,692	$	160,956,055

* Net of unamortized deferred financing costs

Disclosure about fair value of financial instruments is based on pertinent information available to management as of March 31, 2019 and December 31, 2018. 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 March 31, 2019 and current estimates of fair value may differ significantly from the amounts presented herein.

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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, other items with limited tax deductibility and timing differences related to prepaid rents, allowances and intangible assets at significant acquisitions. Taxable income of approximately $4,841,000 was approximately $672,000 more than statement income for the year ended December 31, 2018. The cumulative tax basis of the Partnership’s real estate at December 31, 2018 is approximately $878,000 less than the statement basis. The primary reasons for the difference in tax basis are tax free exchanges, accelerated depreciation and bonus depreciation. The Partnership’s tax basis in its joint venture investments is approximately $1,121,000 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.

Allowable accelerated depreciation deductions were extended through 2018. The 2018 tax law changes had a significant impact on the taxable income of the Partnership. 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 adjustment 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 March 31, 2019, the tax years that generally remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2015 forward.

NOTE 14. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

The Partnership has invested in eight limited partnerships and limited liability companies, the majority of which have invested in residential apartment complexes, with three partnerships investing in commercial property. The Partnership has between a 40%-50% ownership interest in each investment. The other investors were Harold Brown, and five current and former employees of the Management Company. Harold Brown’s ownership interest was between 47.6% and 59%, 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, or Hamilton 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 matured in 2019. The mortgage called for interest only payments for the first two years of the loan and amortized over 30 years thereafter.

On May 31, 2018, Hamilton Park Towers, LLC (“Hamilton Park”), entered into a Mortgage Note with John Hancock Life Insurance Company (U.S.A.) in the principal amount of $125,000,000. Interest only payments on the Note is payable on a monthly basis at a fixed interest rate of 3.99% per annum, and the principal amount of the Note is due and payable on June 1, 2028. The Note is secured by a mortgage on the Dexter Park apartment complex located at 175 Freeman Street, Brookline, Massachusetts pursuant to a Mortgage, Assignment of Leases and Rents and Security Agreement dated May 31, 2018. The Note is guaranteed by the Partnership and HBC Holdings, LLC pursuant to a Guaranty Agreement dated May 31, 2018.

Hamilton Park used the proceeds of the loan to pay off an outstanding loan of approximately $82,000,000 and distributed approximately $41,200,000 to its’ owners. The Partnership’s share of the distribution was approximately $16,500,000. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for the investment using the equity method of accounting, although the Partnership has no legal obligation to fund its’ share of any future operating deficiencies as needed. In connection with this refinancing, the property incurred a defeasance charge of approximately $3,830,000.   Based on its’ ownership in the property, the

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Partnership incurred 40% of this charge, an expense of approximately $1,532,000. This charge had a material effect on the 2018 net income.

At March 31, 2019, the balance on this mortgage before unamortized deferred financing costs is approximately $125,000,000.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 mortgage in the 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 thereafter and matured 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. 2 units were sold in the first three months of 2019, resulting in a gain of approximately $433,000. This investment is referred to as Hamilton Bay Apartments, LLC. As of March 31, 2019, all units were 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 March 31, 2019, 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 Joint Venture sold 127 of the units as condominiums and retained 49 units for long‑term investment. The Joint Venture obtained a new 10‑year mortgage in the amount of $5,000,000 on the units to be retained by the Joint Venture. 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. As of March 31, 2019,  1 unit was under purchase and sales agreement and the Partnership owned 3 units. 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. This investment is referred to as Hamilton Minuteman, LLC. At March 31, 2019, 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 2018, the carrying value of

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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 to fund its share of any future operating deficiencies, if needed.

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 March 31, 2019, 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 2018, 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 to fund its share of any future operating deficiencies, if needed.

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 March 31, 2019, the balance of this mortgage before unamortized deferred financing costs is approximately $9,504,000. This investment is referred to as 345 Franklin, LLC.

Summary financial information as of March 31, 2019

				Hamilton												Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,117,613		$	2,595,015		$	5,919,727		$	103,238		$	0		$	5,556,929		$	16,490,749		$	86,186,211		$	123,969,482
Rental property held for sale		0			0			0			159,188			0			0			0			0			159,188
Cash & Cash Equivalents		192,441			169,930			213,656			51,285			359,291			132,903			163,789			1,853,435			3,136,730
Rent Receivable		222,191			49,619			4,437			2,441			0			1,487			17,049			136,962			434,186
Real Estate Tax Escrow		72,624			—			50,334			—			0			28,960			95,525			0			247,443
Prepaid Expenses & Other Assets		274,111			110,681			61,989			30,377			3,595			16,287			105,663			1,022,670			1,625,373
Total Assets	$	7,878,980		$	2,925,245		$	6,250,143		$	346,529		$	362,886		$	5,736,566		$	16,872,775		$	89,199,278		$	129,572,402
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,910,371		$	—		$	9,442,200		$	—		$	—		$	5,898,047		$	16,813,056		$	124,407,623		$	166,471,297
Accounts Payable & Accrued Expense		84,485			2,187			121,342			10,844			10,951			61,051			205,044			701,699			1,197,603
Advance Rental Pmts & Security Deposits		297,683			—			283,486			7,174			101			123,167			391,075			2,620,890			3,723,576
Total Liabilities		10,292,539			2,187			9,847,028			18,018			11,052			6,082,265			17,409,175			127,730,212			171,392,476
Partners’ Capital		(2,413,559)			2,923,058			(3,596,885)			328,511			351,834			(345,699)			(536,400)			(38,530,934)			(41,820,074)
Total Liabilities and Capital	$	7,878,980		$	2,925,245		$	6,250,143		$	346,529		$	362,886		$	5,736,566		$	16,872,775		$	89,199,278		$	129,572,402
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,461,529		$			$	164,256		$	175,917		$			$			$				1,801,702
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,206,780)		$	—		$	(1,798,443)		$	—		$	—		$	(172,850)		$	(268,200)		$	(15,412,374)			(18,858,645)
Total Investment in Unconsolidated Joint Ventures (Net)																									$	(17,056,944)
Total units/condominiums
Apartments		48			—			40			175			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			3
Total		49			1			40			176			48			42			148			409			1,033
Units to be retained		49			1			40			—			—			42			148			409			690
Units to be sold		—			—			—			175			48			—			—			—			343
Units sold through May 1, 2019		—			—			—			173			48			—			—			—			221
Unsold units		—			—			—			3			—			—			—			—			3
Unsold units with deposits for future sale as of  May 1, 2019		—			—			—			1			—			—			—			—			1

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Financial information for the three months ended March 31, 2019

			Hamilton								Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	459,573	$	75,290	$	385,243	$	23,594	$	3,629	$	274,837	$	822,668		4,028,259	$	6,073,093
Laundry and Sundry Income		3,005		—		1,389		—		—		1,907		10,062		24,025		40,388
		462,578		75,290		386,632		23,594		3,629		276,744		832,730		4,052,284		6,113,481
Expenses
Administrative		5,379		2,092		5,390		1,694		3,445		3,716		17,847		55,532		95,095
Depreciation and Amortization		119,544		5,074		86,226		3,196		5,420		88,595		258,438		900,101		1,466,594
Management Fees		17,206		2,160		14,056		965		145		11,067		31,868		86,149		163,616
Operating		21,450		8		22,603		775		(109)		23,755		107,289		381,644		557,415
Renting		3,330		—		3,520						2,032		16,112		19,663		44,657
Repairs and Maintenance		37,884		—		18,467		8,040		10,266		36,672		124,192		256,585		492,106
Taxes and Insurance		61,830		15,677		40,241		7,349		4,906		32,251		104,431		518,726		785,411
		266,623		25,011		190,503		22,019		24,073		198,088		660,177		2,218,400		3,604,894
Income Before Other Income		195,955		50,279		196,129		1,575		(20,444)		78,656		172,553		1,833,884		2,508,587
Other Income (Loss)
Interest Expense		(121,005)		—		(94,247)				(6)		(57,991)		(188,268)		(1,270,103)		(1,731,620)
Gain on Sale of Real Estate				—		—		754		432,908								433,662
		(121,005)		—		(94,247)		754		432,902		(57,991)		(188,268)		(1,270,103)		(1,297,958)
Net Income (Loss)	$	74,950	$	50,279	$	101,882	$	2,329	$	412,458	$	20,665	$	(15,715)	$	563,781	$	1,210,629
Net Income (Loss)—NERA 50%	$	37,475	$	25,140	$	50,941	$	1,165	$	206,229	$	10,333	$	(7,858)				323,424
Net Income —NERA 40%															$	225,515		225,515
																	$	548,939

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Future annual mortgage maturities at March 31, 2019 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
3//31/2020	$	—	$	199,661	$		$	—	$		$	199,661
3/31/2021		—		207,527				—				207,527
3/31/2022		—		215,702		—		—				215,702
3/31/2023		—		224,199		—		—				224,199
3/31/2024		—		233,032		—		—				233,032
Thereafter		10,000,000		8,423,670		6,000,000		16,900,000		125,000,000		166,323,670
		10,000,000		9,503,791		6,000,000		16,900,000		125,000,000		167,403,791
Less: unamortized deferred financing costs		(89,629)		(61,591)		(101,953)		(86,944)		(592,377)		(932,494)
	$	9,910,371	$	9,442,200	$	5,898,047	$	16,813,056	$	124,407,623	$	166,471,297

At March 31, 2019 the weighted average interest rate on the above mortgages was 3.87%. The effective rate was 3.94% including the amortization expense of deferred financing costs.

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Summary financial information as March 31, 2018

				Hamilton												Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,515,492		$	2,597,633		$	6,242,990		$	887,890		$	1,583,448		$	5,854,350		$	17,359,777		$	89,284,170		$	131,325,750
Cash & Cash Equivalents		148,701			50,004			123,091			136,822			122,350			107,268			102,710			861,790			1,652,736
Rent Receivable		133,580			—			19,937			6,902			2,463			5,206			21,196			221,175			410,459
Real Estate Tax Escrow		83,760			—			46,751			—			—			32,229			152,782			349,904			665,426
Prepaid Expenses & Other Assets		80,429			279			50,269			586,555			693,936			17,475			95,705			2,668,635			4,193,283
Total Assets	$	7,961,962		$	2,647,916		$	6,483,038		$	1,618,169		$	2,402,197		$	6,016,528		$	17,732,170		$	93,385,674		$	138,247,654
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,896,582		$	—		$	9,627,636		$	—		$	—		$	5,889,863		$	16,797,004		$	81,509,648		$	123,720,733
Accounts Payable & Accrued Expense		74,966			2,188			87,137			8,434			9,554			55,333			169,932			634,933			1,042,477
Advance Rental Pmts& Security Deposits		341,039			—			245,550			12,555			10,975			112,103			321,274			2,608,580			3,652,076
Total Liabilities		10,312,587			2,188			9,960,323			20,989			20,529			6,057,299			17,288,210			84,753,161			128,415,286
Partners’ Capital		(2,349,625)			2,645,728			(3,477,285)			1,597,180			2,381,668			(40,771)			443,960			8,630,513			9,831,368
Total Liabilities and Capital	$	7,962,962		$	2,647,916		$	6,483,038		$	1,618,169		$	2,402,197		$	6,016,528		$	17,732,170		$	93,383,674		$	138,246,654
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,322,863		$	—		$	798,589		$	1,190,833		$			$	221,979		$	3,452,204		$	6,986,470
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,174,814)		$	—		$	(1,738,644)		$	—		$	—		$	(20,387)		$	—		$	—			(2,933,844)
Total Investment in Unconsolidated Joint Ventures (Net)																									$	4,052,626
Total units/condominiums
Apartments		48			—			40			175			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			3
Total		49			1			40			176			48			42			148			409			1,033
Units to be retained		49			1			40			0			0			42			148			409			690
Units to be sold		—			—			—			176			46			—			—			—			343
Units sold through May1, 2018		—			—			—			143			1			—			—			—			264
Unsold units		—			—			—			32			47			—			—			—			79
Unsold units with deposits for future sale as of May 1, 2018		—			—			—			4			10			—			—			—			14

Financial information for the three months ended March 31, 2018

											Hamilton		Hamilton
	Hamilton		Hamilton Essex		345		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	411,222	$	53,928	$	403,837	$	38,221	$	22,203	$	263,051	$	858,213	$	3,894,603	$	5,945,278
Laundry and Sundry Income		3,005		—		1,217		—		—		675		9,126		24,688		38,711
		414,227		53,928		405,054		38,221		22,203		263,726		867,339		3,919,291		5,983,989
Expenses
Administrative		9,680		488		6,455		1,499		3,066		1,824		13,127		65,429		101,568
Depreciation and Amortization		114,285		665		86,251		—		10,000		87,722		255,506		874,142		1,428,571
Management Fees		13,204		2,157		16,126		1,508		1,022		10,368		32,443		83,012		159,840
Operating		24,131		—		20,580		156		825		33,850		120,393		379,875		579,810
Renting		3,291		—		497		—		—		3,378		8,652		29,782		45,600
Repairs and Maintenance		54,501		4,163		21,497		40,207		34,224		19,617		182,374		318,666		675,249
Taxes and Insurance		62,527		16,723		41,631		18,171		16,459		31,046		104,551		419,289		710,397
		281,619		24,196		193,037		61,541		65,596		187,805		717,046		2,170,195		3,701,035
Income Before Other Income		132,608		29,732		212,017		(23,320)		(43,393)		75,921		150,293		1,749,096		2,282,954
Other Income (Loss)
Interest Expense		(99,313)		—		(96,961)		(26)		(49)		(58,519)		(188,239)		(1,166,238)		(1,609,345)
Interest Income				—		—						—		—		—		—
Gain on sale of real estate				—		—		817,006		827,757		—		—		—		1,644,763
		(99,313)		—		(96,961)		816,980		827,708		(58,519)		(188,239)		(1,166,238)		35,418
Net Income (Loss)	$	33,295	$	29,732	$	115,056	$	793,660	$	784,315	$	17,402	$	(37,946)	$	582,858	$	2,318,372
Net Income (Loss)—NERA 50%	$	16,648	$	14,866	$	57,528	$	396,830	$	392,158	$	8,701	$	(18,973)				867,757
Net Income (Loss)—NERA 40%															$	233,143		233,143
																	$	1,100,900

NOTE 15. EMPLOYEE BENEFIT 401(k) PLANS

Effective January 1, 2019, employees of the Partnership, who meet certain minimum age and service requirements, are eligible to participate in the Management Company’s 401(k) Plan (the “401(k) Plan”).  Eligible employees may elect to defer up to 90 percent of their eligible compensation on a pre-tax basis to the 401(k) Plan, subject to certain limitations imposed by federal law. 

The amounts contributed by employees are immediately vested and non-forfeitable.  Beginning January 1, 2019, the Partnership matched 50% up to the 6% of compensation deferred by each employee in the 401(k) plan. The Partnership may make discretionary matching or profit-sharing contributions to the 401(k) Plan on behalf of eligible participants in any plan year.  Participants are always 100 percent vested in their pre-tax contributions and will begin vesting in any

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matching or profit-sharing contributions made on their behalf after two years of service with the Partnership at a rate of 20 percent per year, becoming 100 percent vested after a total of six years of service with the Partnership. Total expense recognized by the Partnership for the 401(k) Plan for the three months ended March 31, 2019 was $12,000.

NOTE 16. IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

There have been no new accounting pronouncements applicable to the Partnership that would have a material impact on the Partnership’s consolidated financial statements.

NOTE 17—SUBSEQUENT EVENTS

From April 1, 2019 through May 3, 2019, the Partnership purchased a total of 1,540 Depository Receipts. The average price was $64.91 per receipt or $1,947.21 per unit. The total cost was $96,861.

The Partnership is required to purchase 12 Class B units and 1 General Partnership units at a cost of $23,740 and $1,249 respectively.

The Partnership is currently negotiating a refinancing of the mortgage for Captain Parker held by KeyBank. The new loan would be for $20,750,000 for 10 years, interest only at 4.05%. If the negotiation is successful, there will be a 1% prepayment penalty on the existing loan balance of $20,071,000. The penalty charge would be approximately $200,000, and would have a material effect on the 2019 second quarter net income. The Partnership is expected to close on the refinancing at the end of May, 2019.

Effective as of May 3, 2019, the Board of Directors of the Partnership’s General Partner, NewReal, Inc. (“New Real”), elected Andrew Bloch as a member of the Board. Mr. Bloch is the CO-CEO and CFO of The Hamilton Company, Inc., the Manager of the Partnership’s properties.

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ITEM 2. 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 2019 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.

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.

During the first quarter of 2019, rents continued to increase with average increases of 4.1% for renewals and 2.8% for new leases.  Early indications for 2019 are that rents will continue to increase and renewal rents are expected to be in the range of 3-4%.

For the first quarter of 2019, including the purchase of Hamilton Highlands, consolidated revenue increased by 5.9%, operating expenses increased by 6.2% and Income before Other Income (Expense) grew by 5.1%. Excluding the Hamilton Highland acquisition, same store revenue grew by 2.4%, operating expenses decreased by 1.9% and Income before Other Income (Expense) grew by 13.9%. For the same reporting period, vacancy was 2.8% vs 2.4%. Excluding Depreciation and Amortization, same store revenues (excluding Woodland Park and Hamilton Highlands) grew by 2.4%, operating expenses by 2.6% and Net Operating Income by 2.1%. Management believes similar same store operating results will be achieved for 2019 and that the recent acquisition will result in higher performance.

The Joint Ventures of 1025 Hancock and Hamilton Bay made significant progress in 2018 towards the goal of completely selling out all residential condominium units.   Each Joint Venture sold 16 units in 2018, 1025 Hancock has 2 remaining units and Hamilton Bay sold its remaining 3units during the first quarter of 2019.  It is now projected that the remaining residential units at 1025 Hancock will be sold in the second quarters of 2019.  The estimated profit to the Partnership for the sale of these units from 2014 through 2019 is approximately $6,800,000.

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.  In January 2019, the Partnership paid off the $2,000,000 balance on the line of credit.  As of March 31, 2019, the credit line had no outstanding balance.

In January 2019, the Partnership purchased 40,000 Depository Receipts from the former president of the management company.  The cost of this transaction was $2,155,400 or $53.89 per receipt.  Subsequently, the Partnership purchase 1,704 receipts in February and 1,391 receipts in March.  The total cost for the 43,095 receipts purchased during the first quarter of 2019, was $2,344,601.

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The Partnership is currently in the process of refinancing the Residences at Captain Parkers. The current mortgage of $20,071,000 has a variable interest rate; currently 4.5%, which matures in February 2026, and has interest only payments until March 2021, with a thirty year amortization schedule thereafter.  The new mortgage is expected to be for $20,750,000, with a fixed rate of 4.05%, maturing in 10 years, with interest only payments for the term of the loan.

The Stock Repurchase Program that was initiated in 2007 has purchased 1,408,401 Depositary Receipts through March 31, 2019 or approximately 32% of the outstanding Class A Depositary Receipts. During the three months ended March 31, 2019, the Partnership purchased a total of 43,095 Depositary Receipts. The average price was $54.40 per receipt or $1,632.12 per unit. The total cost including commission was $2,344,601. The Partnership was required to repurchase 341 Class B Units and 18 General Partnership units at a cost of $556,828 and $29,307 respectively.

At May 1, 2019, the Estate of Harold Brown and his brother Ronald Brown  collectively own approximately 21% of the Depositary Receipts representing the Partnership Class A Units (including Depositary Receipts held by trusts for the benefit of such persons’ family members). The Estate of 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 Jameson Brown is NewReal’s Treasurer and a director. The 75% of the issued and outstanding Class B units of the Partnership, controlled by the Estate of Harold Brown, are owned by HBC Holdings LLC, an entity of which Jameson Brown 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. During the three months ended March 31, 2019, tenant renewals were approximately 82% with an average rental increase of approximately 4.1%, new leases accounted for approximately 18% with rental rate increases of approximately 2.8 %. During the three months ended March 31, 2019, leasing commissions were approximately $86,000 compared to approximately $38,000 for the three months ended March 31, 2018,  an increase of approximately $48,000 (126.3%) from 2018. Tenant concessions were approximately $33,000 for the three months ended March 31, 2019, compared to approximately $16,000 for the three months ended March 31, 2018, an increase of approximately $17,000 (106.3%). Tenant improvements were approximately $385,000 for the three months ended March 31, 2019, compared toapproximately $517,000 for the three months ended March 31, 2018, a decrease of approximately $132,000 (25.5%).

Hamilton accounted for approximately 5.6% of the repair and maintenance expenses paid for by the Partnership during the three months ended March 31, 2019 and 4.5 % during the three months ended March 31, 2018. 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 $59,000 (66.3%) and approximately $53,000 (84.4 %) of the legal services paid for by the Partnership during the three months ended March 31, 2019 and 2018 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

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department also provides services to the Partnership on an as-needed basis. During the three months ended March 31, 2019, Hamilton provided the Partnership approximately $150,000 in construction and architectural services, compared to approximately $168,000 for the three months ended March 31, 2018.

Hamilton’s accounting staff perform bookkeeping and accounting functions for the Partnership. During the three months ended March 31, 2019 and 2018, Hamilton charged the Partnership $31,250 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.

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

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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 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

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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.

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RESULTS OF OPERATIONS

Three Months Ended March 31,  2019 and March 31, 2018

The Partnership and its Subsidiary Partnerships earned income before interest expense, income from investments in unconsolidated joint ventures, gain on sale of real estate and other income and expense of approximately $3,952,000 during the three months ended March 31, 2019,  compared to approximately $3,762,000 for the three months ended March 31, 2018,  an  increase of approximately $190,000 (5.1%).

The rental activity is summarized as follows:

	Occupancy Date
	May 1, 2019		May 1, 2018
Residential
Units	2,730		2,730
Vacancies	76		65
Vacancy rate	2.8	%	2.4	%
Commercial
Total square feet	108,043		108,043
Vacancy	1,360		—
Vacancy rate	1.3	%	0.0	%

	Rental Income (in thousands)
	Three Months Ended  March 31,
	2019						2018
	Total			Continuing			Total			Continuing
	Operations			Operations			Operations			Operations
Total rents	$	14,768		$	14,768		$	13,943		$	13,943
Residential percentage		94	%		94	%		93	%		93	%
Commercial percentage		6	%		6	%		7	%		7	%
Contingent rentals	$	129		$	129		$	223		$	223

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Three Months Ended March 31, 2019 Compared to Three Months Ended March 31, 2018:

	Three Months Ended March 31,				Dollar		Percent
	2019		2018		Change		Change
Revenues
Rental income	$	14,768,475	$	13,942,645	$	825,830	5.9	%
Laundry and sundry income		113,669		116,355		(2,686)	(2.3)	%
		14,882,144		14,059,000		823,144	5.9	%
Expenses
Administrative		612,757		539,145		73,612	13.7	%
Depreciation and amortization		3,682,678		3,507,091		175,587	5.0	%
Management fee		590,610		559,629		30,981	5.5	%
Operating		1,884,017		1,900,766		(16,749)	(0.9)	%
Renting		182,058		107,899		74,159	68.7	%
Repairs and maintenance		1,944,231		1,814,283		129,948	7.2	%
Taxes and insurance		2,034,106		1,868,483		165,623	8.9	%
		10,930,457		10,297,296		633,161	6.1	%
Income Before Other Income  (Expense)		3,951,687		3,761,704		189,983	5.1	%
Other Income (Expense)
Interest income		179		164		15	9.1	%
Interest expense		(3,000,289)		(2,984,210)		(16,079)	0.5	%
Income  from investments in unconsolidated joint ventures		548,939		1,100,900		(551,961)	(50.1)	%
		(2,451,171)		(1,883,146)		(568,025)	30.2	%
Net Income	$	1,500,516	$	1,878,558	$	(378,042)	(20.1)	%

Rental income for the three months ended March 31, 2019 was approximately $14,769,000, compared to approximately $13,943,000 for the three months ended March 31, 2018,  an  increase of approximately $826,000 (5.9%). The factors that can be attributed to this increase are as follows: the acquisition of Hamilton Highland resulted in an increase in rental income of approximately $493,000. In addition, rental income has increased at a number of properties due to increased demand and increases in rental rates. The Partnership Properties with the most significant increases in rental income include 62 Boylston, Captain Parker, Redwood Hills, Westgate Apartments, School Street 9 Associates, and Woodland Park, , with increases of approximately $76,000, $58,000, $47,000, $43,000, $31,000, and $26,000, 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.

Operating expenses for the three months ended March 31, 2019 were approximately $10,930,000 compared to approximately $10,297,000 for the three months ended March 31, 2018,  an increase of approximately $633,000 (6.1%). Excluding the increase in operating expenses attributable to the acquisition of Hamilton Highland of approximately $824,000, operating expenses decreased approximately $191,000 (1.9%). The factors contributing to this net decrease are a decrease in depreciation and amortization of approximately $ 369,000 (10.6%) due to fully depreciated assets, a decrease in operating costs of approximately $67,000 (7.5%), partially offset by an increase in taxes and insurance of approximately $98,000 (5.3%), and an increase in repairs and maintenance of approximately $63,000 (3.5%).

Interest expense for the three months ended March 31, 2019 was approximately $3,000,000 compared to approximately $2,984,000 for the three months ended March 31, 2018, an increase of approximately $16,000 (0.5%). Excluding the increase in interest expense attributable to Hamilton Highland of approximately $230,000, there was a decrease in interest expense of approximately $214,000, primarily due to the payoff of the line of credit.

At March 31, 2019, the Partnership has between a 40% and 50% ownership interests in eight 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 $549,000 for  the three months ended March 31, 2019, compared to net income of approximately $1,101,000 for the three months ended March 31, 2018,  a decrease in income of

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approximately $552,000 (50 .1%). This decrease is primarily due to a the gain on the sale of real estate of approximately $434,000, with the Partnership’s share amounting to 50%, on the sale of 2 units at Hamilton Bay Apartments LLC, compared to a gain of approximately $1,645,000 on the sale of 6 units at Hamilton Bay Apartments LLC, and 8 units at Hamilton 1025 LLC, for the three months ended March 31, 2018. Included in the income for the three months ended March 31, 2019 is depreciation and amortization expense of approximately $643,000. The proportional income for the three months ended March 31, 2019 from the investment in Dexter Park is approximately $226,000.

As a result of the changes discussed above, net income for the three months ended March 31, 2019 was approximately $1,501,000 compared to income of approximately $1,879,000 for the three months ended March 31, 2018, a decrease  in income of approximately $378,000 (20.1 %).

LIQUIDITY AND CAPITAL RESOURCES

The Partnership’s principal source of cash during the first three months of 2019 was the collection of rents. The Partnership’s principal source of cash in 2018 was the collection of rents, the proceeds from the line of credit, and the refinancing proceeds from Hamilton Park Towers, LLC. The majority of cash and cash equivalents of $7,649,882 at March 31, 2019 and $9,059,901 at December 31, 2018 were held in interest bearing accounts at creditworthy financial institutions.

The decrease in cash of $1,410,019 for the three months ended March 31, 2019 is summarized as follows:

	Three Months Ended March 31,
	2019		2018
Cash provided by operating activities *	$	5,032,535	$	5,623,026
Cash provided by (used in) investing activities*		138,156		(14,397,762)
Cash  (used in) provided by financing activities		(2,472,621)		7,482,780
Repurchase of Depositary Receipts, Class B and General Partner Units		(2,930,736)		—
Distributions paid		(1,177,353)		(1,119,481)
Net (decrease) increase in cash and cash equivalents	$	(1,410,019)	$	(2,411,437)

            *Reclassed to comply with new FASB standard

The change in cash provided by operating activities is due to various factors, including a change in depreciation expense due to recent acquisitions, a change in income and distribution from joint ventures, and the sale of units, as well as other factors. The increase in cash provided by investing activities is primarily due to the distribution from Dexter Park, partially offset by improvements to rental properties. The change in cash provided by financing activities is primarily due to the pay down of the line of credit originally used for the purchase of Hamilton Highlands.

During 2018, the Partnership and its Subsidiary Partnerships have completed improvements to certain of the Properties at a total cost of approximately $677,000. These improvements were funded from cash reserves. Cash reserves have been adequate to fully fund improvements. The most significant improvements were made at School Street Associates, 62 Boylston Street, Hamilton Oaks, Hamilton Green,  Redwood Hills, and Dean Street Associates, at a cost of approximately $103,000, $61,000, $60,000, $51,000, $47,000 and $42,000 respectively. The Partnership plans to invest approximately $2,182,000 in additional capital improvements in 2019.

On March 29, 2018, Hamilton Highlands, LLC (Hamilton highlands”), a wholly-owned subsidiary of New England Realty Associates Limited Partnership, purchased Webster Green Apartments, a 79 unit apartment complex located at 755-757 Highland Avenue, Needham, Massachusetts.  The sale was consummated pursuant to the terms of a Purchase and Sale Contract by and between Webster Green Apartments, LLC, the prior owner of the Property, and The Hamilton Companies, Inc., an affiliate of the Partnership , which agreement was subsequently assigned by Hamilton to the Purchaser.  In connection with the purchase, Hamilton Highlands entered into an Assumption and Modification Agreement dated as of March 29, 2018 with Brookline Bank pursuant to which Hamilton Highlands assumed a note dated as of January 14, 2016 in the principal amount of $21,500,000 and various agreements relating to the note including a Mortgage, Assignment of Leases and Rents, Security Agreement, Fixture Filing dated as of January 14, 2016. The purchase price was $34,500,000, consisting of a payment of approximately $13,000,000 in cash and the assumption of the note and mortgage. Hamilton Highlands funded $5,000,000 of the cash portion of the purchase price out of cash reserves and the remaining $8,000,000 by drawing on an existing line of credit.

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During the three months ended March 31, 2019 the Partnership received distributions of approximately $1,240,000 from the investment properties. For the three months ended, March 31, 2018, the Partnership received distributions of approximately $1,980,000 from the investment properties. Included in these net distributions is the amount from Dexter Park of approximately $620,000 and $240,000 for the three months ended March 31, 2019 and 2018 respectively.

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. In January, 2019 the Partnership paid off the $2,000,000 balance on the line of credit.

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 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 March 31, 2019, the Partnership had a 40%-50% ownership interest in eight Joint Ventures, five of which have mortgage indebtedness. We do not have control of these partnerships and therefore we account for them using the equity method of consolidation. At March 31, 2019, our proportionate share of the non-recourse debt related to these investments was approximately $71,202,000. See Note 14 to the Consolidated Financial Statements.

Contractual Obligations

As of March 31, 2019, we are subject to contractual payment obligations as described in the table below.

				Payments due by period
	2020		2021		2022		2023		2024		Thereafter		Total
Contractual Obligations
Long -term debt
Mortgage debt*	$	4,318,703	$	2,048,769	$	2,606,516	$	67,098,335	$	38,361,814	$	138,804,437	$	253,238,574
Other obligations		—		—		—		—		—		—		—
Total Contractual Obligations	$	4,318,703	$	2,048,769	$	2,606,516	$	67,098,335	$	38,361,814	$	138,804,437	$	253,238,574

* Excluding unamortized deferred financing costs

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 Partnerships has no other material contractual obligations to be disclosed.

Factors That May Affect Future Results

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

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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.

· 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.

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· 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.

ITEM 3.  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.

As of March 31, 2019, the Partnership, its Subsidiary Partnerships and the Investment Properties collectively have approximately $420,642,000 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. The Partnership, its Subsidiary Partnerships and the Investment Properties collectively have variable rate debt of $50,900,000 (without taking out unamortized deferred financing costs) as of March 31, 2019. Interest rates ranged from LIBOR plus 195 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 $459,000 annually and the increase or decrease in the fair value of the Partnership’s fixed rate debt as of March 31, 2019 would be approximately $11  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 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Factors That May Affect Future Results”.

ITEM 4.  CONTROLS AND PROCEDURES

Disclosure Controls and Procedures.  The Partnership’s management, with the participation of the Partnership’s principal executive officer and principal financial officer, has evaluated the effectiveness of the Partnership’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report.  Based on such evaluation, the Partnership’s principal executive officer and principal financial officer have concluded that, as of the end of such period, the Partnership’s disclosure controls and procedures were effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Partnership in the reports that it files or submits under the Exchange Act.

Changes in Internal Control over Financial Reporting.  There were no changes in our internal control over financial reporting during the first quarter of 2019 that materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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PART II  —  OTHER INFORMATION

Item 1.  Legal Proceedings

There are no material legal proceedings, other than ordinary routine litigation incidental to its business, to which the Partnership is a party to or to which any of the Properties is subject.

Item 1A. Risk Factors

There have been no material changes to the risk factors disclosed in Part 1, Item 1A, of our annual report on Form 10K for the fiscal year ended December 31, 2018.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

(a)None

(b)None

(c)Issuer Purchase of Equity Securities during the first quarter of 2019:

				Remaining number of Depositary
			Depositary Receipts	Receipts that may be purchased
Period	Average Price Paid		Purchased as Part of Publicly Announced Plan	Under the Plan (as Amended)
January 1-31, 2019	$	53.89	40,000	594,694
February 1-28, 2019	$	58.66	1,704	592,990
March 1-31, 2019	$	64.12	1,391	591,599
Total			43,095

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 from 1,500,000 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 March 31, 2019, the Partnership has repurchased 1,408,401 Depositary Receipts at an average price of $27.97 per receipt (or $839.10 per underlying Class A Unit), 3,413 Class B Units and 180 General Partnership Units, both at an average price of $996.79 per Unit, totaling approximately $43,205,000 including brokerage fees paid by the Partnership.

During the three months ended March 31, 2019, the Partnership purchased a total of 43,095 Depositary Receipts. The average price was $54.40 per receipt or $1,632.12 per unit. The total cost including commission was $2,344,601. The Partnership was required to repurchase 341 Class B Units and 18 General Partnership units at a cost of $556,828 and $29,307 respectively.

Item 3.  Defaults Upon Senior Securities

None.

Item 4.  Mine Safety Disclosure

Not applicable.

36

Item 5.  Other Information

None

Item 6.  Exhibits

See the exhibit index below.

37

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
(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 Jameson 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 Jameson Brown, Principal Financial Officer of the Partnership (Treasurer and a Director of NewReal, Inc., sole General Partner of the Partnership).
(101.1)	The following financial statements from New England Realty Associates Limited Partnership Quarterly Report on Form 10-Q for the quarter ended March 31, 2019, formatted in XBRL: (i) Consolidated Balance Sheets, (unaudited) (ii) Consolidated Statements of Income, (unaudited) (iii) Consolidated Statements of Changes in Partners’ Capital, (unaudited) (iv) Consolidated Statements of Cash Flows, (unaudited) and (v) Notes to Consolidated Financial Statements, (unaudited).

38

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
Dated: May 8, 2019

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	May 8, 2019
Ronald Brown	(Principal Executive Officer)
/s/ JAMESON BROWN	Treasurer and Director of the General Partner	May 8, 2019
Jameson Brown	(Principal Financial Officer and Principal Accounting Officer)
/s/ GUILLIAEM AERTSEN	Director of the General Partner	May 8, 2019
Guilliaem Aertsen
/s/ DAVID ALOISE	Director of the General Partner	May 8, 2019
David Aloise
/s/ ANDREW BLOCH	Director of the General Partner	May 8, 2019
Andrew Bloch
/s/ EUNICE HARPS	Director of the General Partner	May 8, 2019
Eunice Harps

1

39

EX-31.1

Exhibit 31.1

New England Realty Associates Limited Partnership

CERTIFICATION

I, Ronald Brown, certify that:

1.I have reviewed this quarterly report on Form 10-Q 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: May  8, 2019

EX-31.2

Exhibit 31.2

New England Realty Associates Limited Partnership

CERTIFICATIONS

I, Jameson Brown, certify that:

1.I have reviewed this quarterly report on Form 10-Q 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/ JAMESON BROWN
	Principal Financial Officer
	(Treasurer and Director of the Partnership’s General Partner, NewReal, Inc.)
Date: May  8, 2019

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 Quarterly Report on Form 10-Q of New England Realty Associates Limited Partnership for the three months ended  March 31, 2019, 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 Jameson Brown, the Treasurer 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: May  8, 2019
	/s/ Jameson Brown
	Jameson Brown
	Principal Financial Officer
	(Treasurer and Director of the Partnership’s General Partner, NewReal, Inc.)
Date: May  8, 2019

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.

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 03, 2019
Entity Registrant Name	NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP
Entity Central Index Key	0000746514
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Class A
Entity Common Stock, Shares Outstanding		98,073
Class B
Entity Common Stock, Shares Outstanding		23,292

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2019	Dec. 31, 2018
ASSETS
Rental Properties	$ 227,660,057	$ 230,511,263
Cash and Cash Equivalents	7,649,882	9,059,901
Rents Receivable	779,159	762,923
Real Estate Tax Escrows	471,913	495,824
Prepaid Expenses and Other Assets	4,812,005	4,219,749
Investments in Unconsolidated Joint Ventures	1,801,702	1,985,680
Total Assets	243,174,718	247,035,340
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	251,953,066	252,370,843
Notes Payable		2,000,000
Distribution and Loss in Excess of Investment in Unconsolidated Joint Venture	18,858,645	18,351,562
Accounts Payable and Accrued Expenses	4,126,517	3,927,889
Advance Rental Payments and Security Deposits	6,468,073	6,009,056
Total Liabilities	281,406,301	282,659,350
Partners’ Capital 124,386 and 124,386 units outstanding in 2018 and 2017 respectively	(38,231,583)	(35,624,010)
Total Liabilities and Partners' Capital	$ 243,174,718	$ 247,035,340

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares	Mar. 31, 2019	Dec. 31, 2018	Mar. 31, 2018	Dec. 31, 2017
CONSOLIDATED BALANCE SHEETS
Partners' Capital, units outstanding	122,591	124,386	124,386	124,386

XML

CONSOLIDATED STATEMENTS OF INCOME - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenues
Rental income	$ 14,768,475	$ 13,942,645
Laundry and sundry income	113,669	116,355
Total Revenues	14,882,144	14,059,000
Expenses
Administrative	612,757	539,145
Depreciation and amortization	3,682,678	3,507,091
Management fee	590,610	559,629
Operating	1,884,017	1,900,766
Renting	182,058	107,899
Repairs and maintenance	1,944,231	1,814,283
Taxes and insurance	2,034,106	1,868,483
Total Expenses	10,930,457	10,297,296
Income Before Other Income (Expense)	3,951,687	3,761,704
Other Income (Expense)
Interest income	179	164
Interest expense	(3,000,289)	(2,984,210)
Income from investments in unconsolidated joint ventures	548,939	1,100,900
Total Other Income (Expense)	(2,451,171)	(1,883,146)
Net Income	$ 1,500,516	$ 1,878,558
Income per Unit
Net Income per Unit (in dollars per unit)	$ 12.21	$ 15.10
Weighted Average Number of Units Outstanding (in units)	122,941	124,386

XML

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNER'S CAPITAL - USD ($)	3 Months Ended		139 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Mar. 31, 2019
Increase (Decrease) in Partners' Capital
Balance	$ (35,624,010)	$ (35,315,177)
Balance (in units)	124,386	124,386
Distribution to Partners	$ (1,177,353)	$ (1,119,481)
Stock Buyback	$ (2,930,736)		$ (43,205,000)
Stock Buyback (in units)	(1,795)
Net income	$ 1,500,516	1,878,558
Balance	$ (38,231,583)	$ (34,556,100)	$ (38,231,583)
Balance (in units)	122,591	124,386	122,591
Subtotal
Increase (Decrease) in Partners' Capital
Balance (in units)	180,225	180,225
Balance (in units)	180,225	180,225	180,225
General Partnership
Increase (Decrease) in Partners' Capital
Balance	$ (354,833)	$ (351,745)
Balance (in units)	1,802	1,802
Distribution to Partners	$ (11,774)	$ (11,195)
Stock Buyback	$ (29,307)
Stock Buyback (in units)	(18)
Net income	$ 15,005	18,786
Balance	$ (380,909)	$ (344,154)	$ (380,909)
Balance (in units)	1,802	1,802	1,802
Treasury Units
Increase (Decrease) in Partners' Capital
Balance (in units)	(55,839)	(55,839)
Stock Buyback (in units)	(1,795)
Balance (in units)	(57,634)	(55,839)	(57,634)
Class A
Increase (Decrease) in Partners' Capital
Balance	$ (28,527,352)	$ (28,280,285)
Balance (in units)	144,180	144,180
Distribution to Partners	$ (941,882)	$ (895,585)
Stock Buyback	(2,344,601)
Net income	1,200,413	1,502,846
Balance	$ (30,613,422)	$ (27,673,024)	$ (30,613,422)
Balance (in units)	144,180	144,180	144,180
Class B
Increase (Decrease) in Partners' Capital
Balance	$ (6,741,825)	$ (6,683,147)
Balance (in units)	34,243	34,243
Distribution to Partners	$ (223,697)	$ (212,701)
Stock Buyback	(556,828)
Net income	285,098	356,926
Balance	$ (7,237,252)	$ (6,538,922)	$ (7,237,252)
Balance (in units)	34,243	34,243	34,243

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash Flows from Operating Activities
Net income	$ 1,500,516	$ 1,878,558
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	3,682,678	3,507,091
Amortization of deferred finance costs	54,843	51,541
(Income) from investments in joint venture	(548,939)	(1,100,900)
Change in operating assets and liabilities
Distribution from unconsolidated joint ventures	425,000	1,770,000
Decrease in rents receivable	(16,236)	(23,160)
Increrase (Decrease) in accounts payable and accrued expense	198,628	(25,471)
Decrease (Increase) in real estate tax escrow	23,911	1,640
(Increase) in prepaid expenses and other assets	(746,891)	(523,530)
Increase in advance rental payments and security deposits	459,025	87,257
Total Adjustments	3,532,019	3,744,468
Net cash provided by operating activities	5,032,535	5,623,026
Cash Flows From Investing Activities
Distribution in excess of investment in unconsolidated joint ventures	823,490	210,402
(Investment) in unconsolidated joint ventures	(8,490)	(526,402)
Improvement of rental properties	(676,844)	(868,468)
Purchase of rental property		(13,213,294)
Net cash (used in) investing activities	138,156	(14,397,762)
Cash Flows from Financing Activities
Payment of financing costs		(148,004)
Proceeds of mortgage notes payable		83,684
Proceeds of note payable		8,000,000
Payment of note payable	(2,000,000)
Principal payments of mortgage notes payable	(472,621)	(452,900)
Stock buyback	(2,930,736)
Distributions to partners	(1,177,353)	(1,119,481)
Net cash (used in) provided by financing activities	(6,580,710)	6,363,299
Net Increase in Cash and Cash Equivalents	(1,410,019)	(2,411,437)
Cash and Cash Equivalents, at beginning of period	9,059,901	7,238,905
Cash and Cash Equivalents, at end of period	$ 7,649,882	$ 4,827,468

XML

SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2019

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 27 properties which include 19 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,711 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a 40 - 50%  interest in 8 residential and mixed use properties consisting of 690 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 eight 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: Investment 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 venture 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 some 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 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.

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 $55,000 and $52,000 for the three months ended March 31, 2019 and 2018, 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 2019 or 2018 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: Partner’s Capital).

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 2019 or 2018. The Partnership makes its temporary cash investments with high-credit quality financial institutions. At March 31, 2019, 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 1.61%. At March 31, 2019 and December 31, 2018, respectively approximately $7,406,000, and $10,784,000 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 $62,969 and $44,381 for the three months ended March 31, 2019 and 2018, respectively.

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 three months ended March 31, 2019 and 2018 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.

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RENTAL PROPERTIES

3 Months Ended

Mar. 31, 2019

RENTAL PROPERTIES

RENTAL PROPERTIES

NOTE 2. RENTAL PROPERTIES

As of March 31, 2019, the Partnership and its Subsidiary Partnerships owned 2,711 residential apartment units in 23 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 March 31, 2019, 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 eight residential and mixed use complexes (the “Investment Properties”) at March 31, 2019 with a total of 690 units, accounted for using the equity method of consolidation. See Note 14 for summary information on these investments.

Rental properties consist of the following:

	March 31, 2019		December 31, 2018		Useful Life
Land, improvements and parking lots	$	72,547,547	$	72,547,547	15	-	40	years
Buildings and improvements		221,837,652		221,697,939	15	-	40	years
Kitchen cabinets		12,247,767		12,134,519	5	-	10	years
Carpets		7,773,940		7,591,591	5	-	10	years
Air conditioning		603,149		603,149	5	-	10	years
Laundry equipment		349,071		327,643	5	-	7	years
Elevators		1,873,847		1,839,590	20	-	40	years
Swimming pools		444,629		444,629	10	-	30	years
Equipment		13,016,249		12,919,389	5	-	30	years
Motor vehicles		216,260		216,260			5	years
Fences		38,213		38,213	5	-	15	years
Furniture and fixtures		7,102,834		7,013,845	5	-	7	years
Smoke alarms		528,097		528,097	5	-	7	years
Total fixed assets		338,579,255		337,902,411
Less: Accumulated depreciation		(110,919,198)		(107,391,148)
	$	227,660,057	$	230,511,263

On March 29, 2018, Hamilton Highlands, LLC (“Hamilton Highlands”), a wholly-owned subsidiary of New England Realty Associates Limited Partnership (the “Partnership”), purchased Webster Green Apartments, a 79 unit apartment complex located at 755-757 Highland Avenue, Needham, Massachusetts.  The sale was consummated pursuant to the terms of a Purchase and Sale Contract by and between Webster Green Apartments, LLC, the prior owner of the Property, and The Hamilton Companies, Inc., an affiliate of the Partnership, which agreement was subsequently assigned by Hamilton to Hamilton Highlands.

In connection with the purchase, the Hamilton Highlands entered into an Assumption and Modification Agreement dated as of March 29, 2018 with Brookline Bank pursuant to which the Hamilton Highlands assumed a note dated as of January 14, 2016 in the principal amount of $21,500,000 and various agreements relating to the Note including a Mortgage, Assignment of Leases and Rents, Security Agreement, Fixture Filing dated as of January 14, 2016. The purchase price was $34,500,000, consisting of a payment of approximately $13,000,000 in cash and the assumption of the note and mortgage. Hamilton Highlands funded $5,000,000 of the cash portion of the purchase price out of cash reserves and the remaining $8,000,000 by drawing on an existing line of credit. The closing costs were approximately $141,000. From the purchase price, the Partnership allocated approximately $502,000 for in- place leases, and approximately $40,000 to the value of tenant relationships. These amounts are being amortized over 12 and 24 months respectively.

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RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2019

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 $591,000 and $560,000 for the three months ended March 31, 2019 and 2018, 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. During the three months ended March 31, 2019 and 2018, approximately $349,000 and $354,000, was charged to NERA for legal, accounting, construction, maintenance, brokerage fees, rental and architectural services and supervision of capital improvements. Of the 2019 expenses referred to above, approximately $108,000 consisted of repairs and maintenance, $90,000 of administrative expense and $1,000 for rental commissions. Approximately $150,000 of expenses for construction, architectural services and supervision of capital projects were capitalized in rental properties. Additionally in 2019, the Hamilton Company received approximately $316,000 from the Investment Properties of which approximately $163,000 was the management fee, approximately $121,000 for rental commissions, approximately $18,000 was for maintenance services, approximately $11,000 was for administrative services and approximately $3,000 for architectural services and supervision of capital projects. The management fee is equal to 4% of gross receipts of 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 $789,000 and $824,000 for the three months ended March 31, 2019 and 2018, 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 2018. For the three months ended March 31, 2019, the Partnership contributed $12,000 for the employer’s match portion to the plan. See Note 15.

Bookkeeping and accounting functions are provided by the Management Company’s accounting staff, which consists of approximately 14 people. During the three months ended March 31, 2019 and 2018, the Management Company charged the Partnership $31,250 ($125,000 per year) for bookkeeping and accounting services included in administrative expenses above.

The former President of the Management Company performed asset management consulting services and received an asset management fee from the Partnership. The Partnership did not have a written agreement with this individual. During the three months ended March 31, 2018 this individual received fees of $18,750. At June 29, 2018, the individual resigned his position.

The Partnership has invested in eight 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 the Estate of Harold Brown, and five current and previous employees of the Management Company. Harold Brown’s ownership interest was between 47.6% and 59%. See Note 14 for a description of the properties and their operations.

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OTHER ASSETS

3 Months Ended

Mar. 31, 2019

OTHER ASSETS

OTHER ASSETS

NOTE 4. OTHER ASSETS

Approximately $2,639,000, and $2,571,000 of security deposits are included in prepaid expenses and other assets at March 31, 2019 and December 31, 2018, respectively. The security deposits and escrow accounts are restricted cash.

Included in prepaid expenses and other assets at March 31, 2019 and December 31, 2018 is approximately $494,000 and $477,000, respectively, held in escrow to fund future capital improvements.

Intangible assets on the acquisitions of Webster Green Apartments and Woodland Park Apartments are included in prepaid expenses and other assets. Intangible assets are approximately $18,000 net of accumulated amortization of approximately $1,093,000 and approximately $152,000 net of accumulated amortization of approximately $959,000 at March 31, 2019 and December 31, 2018, respectively.

Financing fees in association with the line of credit of approximately $68,000 and $78,000 are net of accumulated amortization of approximately $60,000 and $50,000 at March 31, 2019 and December 31, 2018 respectively.

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MORTGAGE NOTES PAYABLE

3 Months Ended

Mar. 31, 2019

MORTGAGE NOTES PAYABLE

MORTGAGE NOTES PAYABLE

NOTE 5. MORTGAGE NOTES PAYABLE

At March 31, 2019 and December 31, 2018, the mortgages payable consisted of various loans, all of which were secured by first mortgages on properties referred to in Note 2. At March 31, 2019, the interest rates on these loans ranged from 3.76% to 5.81%, payable in monthly installments aggregating approximately $1,139,000 including principal, to various dates through 2029. The majority of the mortgages are subject to prepayment penalties. At March 31, 2019, the weighted average interest rate on the above mortgages was 4.63%. The effective rate of 4.71% 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 $1,354,000 and $1,420,000 are net of accumulated amortization of approximately $1,363,000 and $1,298,000 at March  31, 2019 and December 31, 2018, respectively.

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

Approximate annual maturities at March 31, 2019 are as follows:

2020—current maturities	$	4,319,000
2021		2,049,000
2022		2,606,000
2023		67,098,000
2024		38,362,000
Thereafter		138,804,000
		253,238,000
Less: unamortized deferred financing costs		(1,285,000)
	$	251,953,000

On March 29, 2018, Hamilton Highlands, LLC (Hamilton Highlands), a wholly-owned subsidiary of New England Realty Associates Limited Partnership, purchased Webster Green Apartments, a 79 unit apartment complex located at 755-757 Highland Avenue, Needham, Massachusetts. The purchase was consummated pursuant to the terms of a Purchase and Sale Contract by and between Webster Green Apartments, LLC, the prior owner of the Property, and The Hamilton Companies, Inc., an affiliate of the Partnership, which agreement was subsequently assigned to Hamilton Highlands.

In connection with the purchase, Hamilton Highlands entered into an Assumption and Modification Agreement dated as of March 29, 2018 with Brookline Bank pursuant to which Hamilton Highlands assumed a note dated as of January 14, 2016 in the principal amount of $21,500,000 and various agreements relating to the Note including a Mortgage, Assignment of Leases and Rents, Security Agreement, Fixture Filing dated as of January 14, 2016.  The purchase price was $34,500,000, consisting of a payment of approximately $13,000,000 in cash and the assumption of the Note and Mortgage. Hamilton Highlands funded $5,000,000 of the cash portion of the purchase price out of cash reserves and the remaining $8,000,000 by drawing on an existing line of credit. The closing costs were approximately $141,000.

On March 12, 2018, the loan for 659 Worcester Road was refinanced with Brookline Bank in the amount of $6,083,683. The loan is due on March 12, 2023. Interest only until March 12, 2021. Commencing in April, 2021, monthly payments of principal and interest in the amount of $32,427 are being made based on an assumed amortization period of thirty (30) years. The loan bears a fixed annual rate equal to 4.87%. The proceeds of the new loan were used to pay off the existing loan. The closing costs were approximately $69,000

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. 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.

On March 29, 2018, the Partnership drew down $8,000,000 in conjunction with the purchase of Webster Green Apartments.  On June 4, 2018, the Partnership paid down the credit line by $16,000,000 as a result of the proceeds from the refinancing of Hamilton Park Towers, LLC, also known as Dexter Park. In July, 2018, the Partnership paid down the line of credit by $4,000,000. In October of 2018, the Partnership paid down the line of credit by $3,000,000. In January 2019, the Partnership paid off  the $2,000,000 balance on the line of credit.

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 $12,000 in fees for the three months ended March 31, 2019.

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 March 31, 2019.

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ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

3 Months Ended

Mar. 31, 2019

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 March 31, 2019, amounts received for prepaid rents of approximately $2,234,000 are included in cash and cash equivalents, and security deposits of approximately $2,639,000 are included in prepaid expenses and other assets and are restricted cash.

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PARTNERS' CAPITAL

3 Months Ended

Mar. 31, 2019

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.

In January 2019, the Partnership approved a quarterly distribution to its Class A Limited Partners and holders of Depositary Receipts of record as of March 15, 2019 and payable on March 31, 2019, of $9.60 per unit ($0.32 per receipt).

In 2018, regular quarterly distributions of $9.00 per unit ($0.30 per receipt) were paid in March, June, September and December.

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:

	Three Months Ended
	March 31,
	2019		2018
Net Income per Depositary Receipt	$	0.41	$	0.50
Distributions per Depositary Receipt	$	0.32	$	0.30

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TREASURY UNITS

3 Months Ended

Mar. 31, 2019

TREASURY UNITS

TREASURY UNITS

NOTE 8. TREASURY UNITS

Treasury Units at March 31, 2019 are as follows:

Class A	46,107
Class B	10,950
General Partnership	577
	57,634

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 from 1,500,000 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 March 31, 2019, the Partnership has repurchased 1,408,401 Depositary Receipts at an average price of $27.97 per receipt (or $839.10 per underlying Class A Unit), 3,413 Class B Units and 180 General Partnership Units, both at an average price of $996.79 per Unit, totaling approximately $43,205,000 including brokerage fees paid by the Partnership.

During the three months ended March 31, 2019, the Partnership purchased a total of 43,095 Depositary Receipts. The average price was $54.40 per receipt or $1,632.12 per unit. The total cost including commission was $2,344,601. The Partnership was required to repurchase 341 Class B Units and 18 General Partnership units at a cost of $556,828 and $29,307 respectively.

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COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2019

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 its 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.

In February, 2019, a water pipe broke at Hamilton Oak in Brockton, MA. resulting in the evacuation of 40 apartments for approximately one week. The Partnership has insurance coverage on both the repairs and rental loss. As of March 31, 2019, the Partnership has received $75,000 on this claim, and has an estimated insurance recovery receivable of approximately $212,000, which is included on the prepaid expenses and other assets as of March 31, 2019.

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RENTAL INCOME

3 Months Ended

Mar. 31, 2019

RENTAL INCOME

RENTAL INCOME

NOTE 10. RENTAL INCOME

During the three months ended March 31, 2019, approximately 94% 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 6% was related to commercial properties, which have minimum future annual rental income on non-cancellable operating leases at March 31, 2019 as follows:

	Commercial
	Property Leases
2020	$	2,565,000
2021		2,299,000
2022		1,591,000
2023		946,000
2024		523,000
Thereafter		756,000
	$	8,680,000

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 $129,000 and $223,000 for the three months ended March 31, 2019 and 2018 respectively. Staples and Trader Joes, tenants at Staples Plaza, are approximately 36% 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 March 31,	expiring leases		for expiring leases	leases expiring	expiring leases
2020	$	454,412	22,400	12	16	%
2021		225,337	5,679	7	8	%
2022		1,143,867	47,854	10	39	%
2023		246,341	7,087	4	9	%
2024		658,784	19,209	8	22	%
2025		15,936	604	3	1	%
2026		—	—	—	—	%
2027		—	—	—	—	%
2028		—	—	—	—	%
2029		—	—	—	—	%
2030		142,450	3,850	1	5	%
Totals	$	2,887,127	106,683	45	100	%

Rents receivable are net of an allowance for doubtful accounts of approximately $369,000 and $532,000 at March 31, 2019 and December 31, 2018. Included in rents receivable at March 31, 2019 is approximately $69,000 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 and Staples Plaza in Massachusetts.

Rents receivable at March 31, 2019 also includes approximately $82,000 representing the deferral of rental concession primarily related to the residential properties.

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CASH FLOW INFORMATION

3 Months Ended

Mar. 31, 2019

CASH FLOW INFORMATION

CASH FLOW INFORMATION

NOTE 11. CASH FLOW INFORMATION

During the three months ended March 31, 2019 and 2018, cash paid for interest was approximately $2,944,000, and $3,010,000 respectively.  Cash paid for state income taxes was approximately $48,000 and $47,000 during the three months ended March 31, 2019 and 2018 respectively. Additionally, at March 31,2018,  the Partnership was involved in a non-cash financing activity of approximately $21,000,000 in connection with the purchase of

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FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2019

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

NOTE 12. FAIR VALUE MEASUREMENTS

Fair Value Measurements on a Recurring Basis

At March 31, 2019 and December 31, 2018, 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 March 31, 2019 and December 31, 2018 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 March 31, 2019 and December 31, 2018, 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 March 31, 2019 and December 31, 2018, 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 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 mortgage 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 March 31, 2019	*	$	251,953,066	$	235,100,502
At December 31, 2018	*	$	252,370,843	$	233,362,501
Investment Properties
At March 31, 2019	*	$	166,471,296	$	163,347,932
At December 31, 2018	*	$	166,492,692	$	160,956,055

* Net of unamortized deferred financing costs

Disclosure about fair value of financial instruments is based on pertinent information available to management as of March 31, 2019 and December 31, 2018. 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 March 31, 2019 and current estimates of fair value may differ significantly from the amounts presented herein.

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TAXABLE INCOME AND TAX BASIS

3 Months Ended

Mar. 31, 2019

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, other items with limited tax deductibility and timing differences related to prepaid rents, allowances and intangible assets at significant acquisitions. Taxable income of approximately $4,841,000 was approximately $672,000 more than statement income for the year ended December 31, 2018. The cumulative tax basis of the Partnership’s real estate at December 31, 2018 is approximately $878,000 less than the statement basis. The primary reasons for the difference in tax basis are tax free exchanges, accelerated depreciation and bonus depreciation. The Partnership’s tax basis in its joint venture investments is approximately $1,121,000 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.

Allowable accelerated depreciation deductions were extended through 2018. The 2018 tax law changes had a significant impact on the taxable income of the Partnership. 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 adjustment 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 March 31, 2019, the tax years that generally remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2015 forward.

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

3 Months Ended

Mar. 31, 2019

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

NOTE 14. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

The Partnership has invested in eight limited partnerships and limited liability companies, the majority of which have invested in residential apartment complexes, with three partnerships investing in commercial property. The Partnership has between a 40%-50% ownership interest in each investment. The other investors were Harold Brown, and five current and former employees of the Management Company. Harold Brown’s ownership interest was between 47.6% and 59%, 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, or Hamilton 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 matured in 2019. The mortgage called for interest only payments for the first two years of the loan and amortized over 30 years thereafter.

On May 31, 2018, Hamilton Park Towers, LLC (“Hamilton Park”), entered into a Mortgage Note with John Hancock Life Insurance Company (U.S.A.) in the principal amount of $125,000,000. Interest only payments on the Note is payable on a monthly basis at a fixed interest rate of 3.99% per annum, and the principal amount of the Note is due and payable on June 1, 2028. The Note is secured by a mortgage on the Dexter Park apartment complex located at 175 Freeman Street, Brookline, Massachusetts pursuant to a Mortgage, Assignment of Leases and Rents and Security Agreement dated May 31, 2018. The Note is guaranteed by the Partnership and HBC Holdings, LLC pursuant to a Guaranty Agreement dated May 31, 2018.

Hamilton Park used the proceeds of the loan to pay off an outstanding loan of approximately $82,000,000 and distributed approximately $41,200,000 to its’ owners. The Partnership’s share of the distribution was approximately $16,500,000. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for the investment using the equity method of accounting, although the Partnership has no legal obligation to fund its’ share of any future operating deficiencies as needed. In connection with this refinancing, the property incurred a defeasance charge of approximately $3,830,000.   Based on its’ ownership in the property, the Partnership incurred 40% of this charge, an expense of approximately $1,532,000. This charge had a material effect on the 2018 net income.

At March 31, 2019, the balance on this mortgage before unamortized deferred financing costs is approximately $125,000,000.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 mortgage in the 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 thereafter and matured 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. 2 units were sold in the first three months of 2019, resulting in a gain of approximately $433,000. This investment is referred to as Hamilton Bay Apartments, LLC. As of March 31, 2019, all units were 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 March 31, 2019, 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 Joint Venture sold 127 of the units as condominiums and retained 49 units for long‑term investment. The Joint Venture obtained a new 10‑year mortgage in the amount of $5,000,000 on the units to be retained by the Joint Venture. 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. As of March 31, 2019,  1 unit was under purchase and sales agreement and the Partnership owned 3 units. 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. This investment is referred to as Hamilton Minuteman, LLC. At March 31, 2019, 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 2018, 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 to fund its share of any future operating deficiencies, if needed.

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 March 31, 2019, 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 2018, 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 to fund its share of any future operating deficiencies, if needed.

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 March 31, 2019, the balance of this mortgage before unamortized deferred financing costs is approximately $9,504,000. This investment is referred to as 345 Franklin, LLC.

Summary financial information as of March 31, 2019

				Hamilton												Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,117,613		$	2,595,015		$	5,919,727		$	103,238		$	0		$	5,556,929		$	16,490,749		$	86,186,211		$	123,969,482
Rental property held for sale		0			0			0			159,188			0			0			0			0			159,188
Cash & Cash Equivalents		192,441			169,930			213,656			51,285			359,291			132,903			163,789			1,853,435			3,136,730
Rent Receivable		222,191			49,619			4,437			2,441			0			1,487			17,049			136,962			434,186
Real Estate Tax Escrow		72,624			—			50,334			—			0			28,960			95,525			0			247,443
Prepaid Expenses & Other Assets		274,111			110,681			61,989			30,377			3,595			16,287			105,663			1,022,670			1,625,373
Total Assets	$	7,878,980		$	2,925,245		$	6,250,143		$	346,529		$	362,886		$	5,736,566		$	16,872,775		$	89,199,278		$	129,572,402
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,910,371		$	—		$	9,442,200		$	—		$	—		$	5,898,047		$	16,813,056		$	124,407,623		$	166,471,297
Accounts Payable & Accrued Expense		84,485			2,187			121,342			10,844			10,951			61,051			205,044			701,699			1,197,603
Advance Rental Pmts & Security Deposits		297,683			—			283,486			7,174			101			123,167			391,075			2,620,890			3,723,576
Total Liabilities		10,292,539			2,187			9,847,028			18,018			11,052			6,082,265			17,409,175			127,730,212			171,392,476
Partners’ Capital		(2,413,559)			2,923,058			(3,596,885)			328,511			351,834			(345,699)			(536,400)			(38,530,934)			(41,820,074)
Total Liabilities and Capital	$	7,878,980		$	2,925,245		$	6,250,143		$	346,529		$	362,886		$	5,736,566		$	16,872,775		$	89,199,278		$	129,572,402
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,461,529		$			$	164,256		$	175,917		$			$			$				1,801,702
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,206,780)		$	—		$	(1,798,443)		$	—		$	—		$	(172,850)		$	(268,200)		$	(15,412,374)			(18,858,645)
Total Investment in Unconsolidated Joint Ventures (Net)																									$	(17,056,944)
Total units/condominiums
Apartments		48			—			40			175			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			3
Total		49			1			40			176			48			42			148			409			1,033
Units to be retained		49			1			40			—			—			42			148			409			690
Units to be sold		—			—			—			175			48			—			—			—			343
Units sold through May 1, 2019		—			—			—			173			48			—			—			—			221
Unsold units		—			—			—			3			—			—			—			—			3
Unsold units with deposits for future sale as of  May 1, 2019		—			—			—			1			—			—			—			—			1

Financial information for the three months ended March 31, 2019

			Hamilton								Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	459,573	$	75,290	$	385,243	$	23,594	$	3,629	$	274,837	$	822,668		4,028,259	$	6,073,093
Laundry and Sundry Income		3,005		—		1,389		—		—		1,907		10,062		24,025		40,388
		462,578		75,290		386,632		23,594		3,629		276,744		832,730		4,052,284		6,113,481
Expenses
Administrative		5,379		2,092		5,390		1,694		3,445		3,716		17,847		55,532		95,095
Depreciation and Amortization		119,544		5,074		86,226		3,196		5,420		88,595		258,438		900,101		1,466,594
Management Fees		17,206		2,160		14,056		965		145		11,067		31,868		86,149		163,616
Operating		21,450		8		22,603		775		(109)		23,755		107,289		381,644		557,415
Renting		3,330		—		3,520						2,032		16,112		19,663		44,657
Repairs and Maintenance		37,884		—		18,467		8,040		10,266		36,672		124,192		256,585		492,106
Taxes and Insurance		61,830		15,677		40,241		7,349		4,906		32,251		104,431		518,726		785,411
		266,623		25,011		190,503		22,019		24,073		198,088		660,177		2,218,400		3,604,894
Income Before Other Income		195,955		50,279		196,129		1,575		(20,444)		78,656		172,553		1,833,884		2,508,587
Other Income (Loss)
Interest Expense		(121,005)		—		(94,247)				(6)		(57,991)		(188,268)		(1,270,103)		(1,731,620)
Gain on Sale of Real Estate				—		—		754		432,908								433,662
		(121,005)		—		(94,247)		754		432,902		(57,991)		(188,268)		(1,270,103)		(1,297,958)
Net Income (Loss)	$	74,950	$	50,279	$	101,882	$	2,329	$	412,458	$	20,665	$	(15,715)	$	563,781	$	1,210,629
Net Income (Loss)—NERA 50%	$	37,475	$	25,140	$	50,941	$	1,165	$	206,229	$	10,333	$	(7,858)				323,424
Net Income —NERA 40%															$	225,515		225,515
																	$	548,939

Future annual mortgage maturities at March 31, 2019 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
3//31/2020	$	—	$	199,661	$		$	—	$		$	199,661
3/31/2021		—		207,527				—				207,527
3/31/2022		—		215,702		—		—				215,702
3/31/2023		—		224,199		—		—				224,199
3/31/2024		—		233,032		—		—				233,032
Thereafter		10,000,000		8,423,670		6,000,000		16,900,000		125,000,000		166,323,670
		10,000,000		9,503,791		6,000,000		16,900,000		125,000,000		167,403,791
Less: unamortized deferred financing costs		(89,629)		(61,591)		(101,953)		(86,944)		(592,377)		(932,494)
	$	9,910,371	$	9,442,200	$	5,898,047	$	16,813,056	$	124,407,623	$	166,471,297

At March 31, 2019 the weighted average interest rate on the above mortgages was 3.87%. The effective rate was 3.94% including the amortization expense of deferred financing costs.

Summary financial information as March 31, 2018

				Hamilton												Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,515,492		$	2,597,633		$	6,242,990		$	887,890		$	1,583,448		$	5,854,350		$	17,359,777		$	89,284,170		$	131,325,750
Cash & Cash Equivalents		148,701			50,004			123,091			136,822			122,350			107,268			102,710			861,790			1,652,736
Rent Receivable		133,580			—			19,937			6,902			2,463			5,206			21,196			221,175			410,459
Real Estate Tax Escrow		83,760			—			46,751			—			—			32,229			152,782			349,904			665,426
Prepaid Expenses & Other Assets		80,429			279			50,269			586,555			693,936			17,475			95,705			2,668,635			4,193,283
Total Assets	$	7,961,962		$	2,647,916		$	6,483,038		$	1,618,169		$	2,402,197		$	6,016,528		$	17,732,170		$	93,385,674		$	138,247,654
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,896,582		$	—		$	9,627,636		$	—		$	—		$	5,889,863		$	16,797,004		$	81,509,648		$	123,720,733
Accounts Payable & Accrued Expense		74,966			2,188			87,137			8,434			9,554			55,333			169,932			634,933			1,042,477
Advance Rental Pmts& Security Deposits		341,039			—			245,550			12,555			10,975			112,103			321,274			2,608,580			3,652,076
Total Liabilities		10,312,587			2,188			9,960,323			20,989			20,529			6,057,299			17,288,210			84,753,161			128,415,286
Partners’ Capital		(2,349,625)			2,645,728			(3,477,285)			1,597,180			2,381,668			(40,771)			443,960			8,630,513			9,831,368
Total Liabilities and Capital	$	7,962,962		$	2,647,916		$	6,483,038		$	1,618,169		$	2,402,197		$	6,016,528		$	17,732,170		$	93,383,674		$	138,246,654
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,322,863		$	—		$	798,589		$	1,190,833		$			$	221,979		$	3,452,204		$	6,986,470
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,174,814)		$	—		$	(1,738,644)		$	—		$	—		$	(20,387)		$	—		$	—			(2,933,844)
Total Investment in Unconsolidated Joint Ventures (Net)																									$	4,052,626
Total units/condominiums
Apartments		48			—			40			175			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			3
Total		49			1			40			176			48			42			148			409			1,033
Units to be retained		49			1			40			0			0			42			148			409			690
Units to be sold		—			—			—			176			46			—			—			—			343
Units sold through May1, 2018		—			—			—			143			1			—			—			—			264
Unsold units		—			—			—			32			47			—			—			—			79
Unsold units with deposits for future sale as of May 1, 2018		—			—			—			4			10			—			—			—			14

Financial information for the three months ended March 31, 2018

											Hamilton		Hamilton
	Hamilton		Hamilton Essex		345		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	411,222	$	53,928	$	403,837	$	38,221	$	22,203	$	263,051	$	858,213	$	3,894,603	$	5,945,278
Laundry and Sundry Income		3,005		—		1,217		—		—		675		9,126		24,688		38,711
		414,227		53,928		405,054		38,221		22,203		263,726		867,339		3,919,291		5,983,989
Expenses
Administrative		9,680		488		6,455		1,499		3,066		1,824		13,127		65,429		101,568
Depreciation and Amortization		114,285		665		86,251		—		10,000		87,722		255,506		874,142		1,428,571
Management Fees		13,204		2,157		16,126		1,508		1,022		10,368		32,443		83,012		159,840
Operating		24,131		—		20,580		156		825		33,850		120,393		379,875		579,810
Renting		3,291		—		497		—		—		3,378		8,652		29,782		45,600
Repairs and Maintenance		54,501		4,163		21,497		40,207		34,224		19,617		182,374		318,666		675,249
Taxes and Insurance		62,527		16,723		41,631		18,171		16,459		31,046		104,551		419,289		710,397
		281,619		24,196		193,037		61,541		65,596		187,805		717,046		2,170,195		3,701,035
Income Before Other Income		132,608		29,732		212,017		(23,320)		(43,393)		75,921		150,293		1,749,096		2,282,954
Other Income (Loss)
Interest Expense		(99,313)		—		(96,961)		(26)		(49)		(58,519)		(188,239)		(1,166,238)		(1,609,345)
Interest Income				—		—						—		—		—		—
Gain on sale of real estate				—		—		817,006		827,757		—		—		—		1,644,763
		(99,313)		—		(96,961)		816,980		827,708		(58,519)		(188,239)		(1,166,238)		35,418
Net Income (Loss)	$	33,295	$	29,732	$	115,056	$	793,660	$	784,315	$	17,402	$	(37,946)	$	582,858	$	2,318,372
Net Income (Loss)—NERA 50%	$	16,648	$	14,866	$	57,528	$	396,830	$	392,158	$	8,701	$	(18,973)				867,757
Net Income (Loss)—NERA 40%															$	233,143		233,143
																	$	1,100,900

XML

EMPLOYEE BENEFIT 401(k) PLANS

3 Months Ended

Mar. 31, 2019

EMPLOYEE BENEFTI 401(k) PLANS

EMPLOYEE BENEFIT 401(k) PLANS

											Hamilton		Hamilton
	Hamilton		Hamilton Essex		345		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	411,222	$	53,928	$	403,837	$	38,221	$	22,203	$	263,051	$	858,213	$	3,894,603	$	5,945,278
Laundry and Sundry Income		3,005		—		1,217		—		—		675		9,126		24,688		38,711
		414,227		53,928		405,054		38,221		22,203		263,726		867,339		3,919,291		5,983,989
Expenses
Administrative		9,680		488		6,455		1,499		3,066		1,824		13,127		65,429		101,568
Depreciation and Amortization		114,285		665		86,251		—		10,000		87,722		255,506		874,142		1,428,571
Management Fees		13,204		2,157		16,126		1,508		1,022		10,368		32,443		83,012		159,840
Operating		24,131		—		20,580		156		825		33,850		120,393		379,875		579,810
Renting		3,291		—		497		—		—		3,378		8,652		29,782		45,600
Repairs and Maintenance		54,501		4,163		21,497		40,207		34,224		19,617		182,374		318,666		675,249
Taxes and Insurance		62,527		16,723		41,631		18,171		16,459		31,046		104,551		419,289		710,397
		281,619		24,196		193,037		61,541		65,596		187,805		717,046		2,170,195		3,701,035
Income Before Other Income		132,608		29,732		212,017		(23,320)		(43,393)		75,921		150,293		1,749,096		2,282,954
Other Income (Loss)
Interest Expense		(99,313)		—		(96,961)		(26)		(49)		(58,519)		(188,239)		(1,166,238)		(1,609,345)
Interest Income				—		—						—		—		—		—
Gain on sale of real estate				—		—		817,006		827,757		—		—		—		1,644,763
		(99,313)		—		(96,961)		816,980		827,708		(58,519)		(188,239)		(1,166,238)		35,418
Net Income (Loss)	$	33,295	$	29,732	$	115,056	$	793,660	$	784,315	$	17,402	$	(37,946)	$	582,858	$	2,318,372
Net Income (Loss)—NERA 50%	$	16,648	$	14,866	$	57,528	$	396,830	$	392,158	$	8,701	$	(18,973)				867,757
Net Income (Loss)—NERA 40%															$	233,143		233,143
																	$	1,100,900

NOTE 15. EMPLOYEE BENEFIT 401(k) PLANS

Effective January 1, 2019, employees of the Partnership, who meet certain minimum age and service requirements, are eligible to participate in the Management Company’s 401(k) Plan (the “401(k) Plan”).  Eligible employees may elect to defer up to 90 percent of their eligible compensation on a pre-tax basis to the 401(k) Plan, subject to certain limitations imposed by federal law. 

The amounts contributed by employees are immediately vested and non-forfeitable.  Beginning January 1, 2019, the Partnership matched 50% up to the 6% of compensation deferred by each employee in the 401(k) plan. The Partnership may make discretionary matching or profit-sharing contributions to the 401(k) Plan on behalf of eligible participants in any plan year.  Participants are always 100 percent vested in their pre-tax contributions and will begin vesting in any matching or profit-sharing contributions made on their behalf after two years of service with the Partnership at a rate of 20 percent per year, becoming 100 percent vested after a total of six years of service with the Partnership. Total expense recognized by the Partnership for the 401(k) Plan for the three months ended March 31, 2019 was $12,000.

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IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

3 Months Ended

Mar. 31, 2019

IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

NOTE 16. IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

There have been no new accounting pronouncements applicable to the Partnership that would have a material impact on the Partnership’s consolidated financial statements.

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SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2019

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

NOTE 17—SUBSEQUENT EVENTS

From April 1, 2019 through May 3, 2019, the Partnership purchased a total of 1,540 Depository Receipts. The average price was $64.91 per receipt or $1,947.21 per unit. The total cost was $96,861.

The Partnership is required to purchase 12 Class B units and 1 General Partnership units at a cost of $23,740 and $1,249 respectively.

The Partnership is currently negotiating a refinancing of the mortgage for Captain Parker held by KeyBank. The new loan would be for $20,750,000 for 10 years, interest only at 4.05%. If the negotiation is successful, there will be a 1% prepayment penalty on the existing loan balance of $20,071,000. The penalty charge would be approximately $200,000, and would have a material effect on the 2019 second quarter net income. The Partnership is expected to close on the refinancing at the end of May, 2019.

Effective as of May 3, 2019, the Board of Directors of the Partnership’s General Partner, NewReal, Inc. (“New Real”), elected Andrew Bloch as a member of the Board. Mr. Bloch is the CO-CEO and CFO of The Hamilton Company, Inc., the Manager of the Partnership’s properties.

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Mar. 31, 2019

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 27 properties which include 19 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,711 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a 40 - 50%  interest in 8 residential and mixed use properties consisting of 690 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 eight 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: Investment 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 venture 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 some 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 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.

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 $55,000 and $52,000 for the three months ended March 31, 2019 and 2018, 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 2019 or 2018 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: Partner’s Capital).

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 2019 or 2018. The Partnership makes its temporary cash investments with high-credit quality financial institutions. At March 31, 2019, 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 1.61%. At March 31, 2019 and December 31, 2018, respectively approximately $7,406,000, and $10,784,000 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 $62,969 and $44,381 for the three months ended March 31, 2019 and 2018, respectively.

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 three months ended March 31, 2019 and 2018 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.

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RENTAL PROPERTIES (Tables)

3 Months Ended

Mar. 31, 2019

RENTAL PROPERTIES

Schedule of rental properties

	March 31, 2019		December 31, 2018		Useful Life
Land, improvements and parking lots	$	72,547,547	$	72,547,547	15	-	40	years
Buildings and improvements		221,837,652		221,697,939	15	-	40	years
Kitchen cabinets		12,247,767		12,134,519	5	-	10	years
Carpets		7,773,940		7,591,591	5	-	10	years
Air conditioning		603,149		603,149	5	-	10	years
Laundry equipment		349,071		327,643	5	-	7	years
Elevators		1,873,847		1,839,590	20	-	40	years
Swimming pools		444,629		444,629	10	-	30	years
Equipment		13,016,249		12,919,389	5	-	30	years
Motor vehicles		216,260		216,260			5	years
Fences		38,213		38,213	5	-	15	years
Furniture and fixtures		7,102,834		7,013,845	5	-	7	years
Smoke alarms		528,097		528,097	5	-	7	years
Total fixed assets		338,579,255		337,902,411
Less: Accumulated depreciation		(110,919,198)		(107,391,148)
	$	227,660,057	$	230,511,263

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MORTGAGE NOTES PAYABLE (Tables)

3 Months Ended

Mar. 31, 2019

MORTGAGE NOTES PAYABLE

Schedule of approximate annual maturities

Approximate annual maturities at March 31, 2019 are as follows:

2020—current maturities	$	4,319,000
2021		2,049,000
2022		2,606,000
2023		67,098,000
2024		38,362,000
Thereafter		138,804,000
		253,238,000
Less: unamortized deferred financing costs		(1,285,000)
	$	251,953,000

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PARTNERS' CAPITAL (Tables)

3 Months Ended

Mar. 31, 2019

PARTNERS' CAPITAL

Schedule of information per depositary receipt

	Three Months Ended
	March 31,
	2019		2018
Net Income per Depositary Receipt	$	0.41	$	0.50
Distributions per Depositary Receipt	$	0.32	$	0.30

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TREASURY UNITS (Tables)

3 Months Ended

Mar. 31, 2019

TREASURY UNITS

Schedule of treasury units

Treasury Units at March 31, 2019 are as follows:

Class A	46,107
Class B	10,950
General Partnership	577
	57,634

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RENTAL INCOME (Tables)

3 Months Ended

Mar. 31, 2019

RENTAL INCOME

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

Approximately 6% was related to commercial properties, which have minimum future annual rental income on non-cancellable operating leases at March 31, 2019 as follows:

	Commercial
	Property Leases
2020	$	2,565,000
2021		2,299,000
2022		1,591,000
2023		946,000
2024		523,000
Thereafter		756,000
	$	8,680,000

Schedule of information for commercial leases

	Annual base				Percentage of
	rent for		Total square feet	Total number of	annual base rent for
Through March 31,	expiring leases		for expiring leases	leases expiring	expiring leases
2020	$	454,412	22,400	12	16	%
2021		225,337	5,679	7	8	%
2022		1,143,867	47,854	10	39	%
2023		246,341	7,087	4	9	%
2024		658,784	19,209	8	22	%
2025		15,936	604	3	1	%
2026		—	—	—	—	%
2027		—	—	—	—	%
2028		—	—	—	—	%
2029		—	—	—	—	%
2030		142,450	3,850	1	5	%
Totals	$	2,887,127	106,683	45	100	%

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FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 31, 2019

FAIR VALUE MEASUREMENTS

Schedule of carrying amounts and estimated fair value of debt

		Carrying Amount		Estimated Fair Value
Mortgage Notes Payable
Partnership Properties
At March 31, 2019	*	$	251,953,066	$	235,100,502
At December 31, 2018	*	$	252,370,843	$	233,362,501
Investment Properties
At March 31, 2019	*	$	166,471,296	$	163,347,932
At December 31, 2018	*	$	166,492,692	$	160,956,055

* Net of unamortized deferred financing costs

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Tables)

3 Months Ended

Mar. 31, 2019

Schedule of future annual mortgage maturities

Future annual mortgage maturities at March 31, 2019 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
3//31/2020	$	—	$	199,661	$		$	—	$		$	199,661
3/31/2021		—		207,527				—				207,527
3/31/2022		—		215,702		—		—				215,702
3/31/2023		—		224,199		—		—				224,199
3/31/2024		—		233,032		—		—				233,032
Thereafter		10,000,000		8,423,670		6,000,000		16,900,000		125,000,000		166,323,670
		10,000,000		9,503,791		6,000,000		16,900,000		125,000,000		167,403,791
Less: unamortized deferred financing costs		(89,629)		(61,591)		(101,953)		(86,944)		(592,377)		(932,494)
	$	9,910,371	$	9,442,200	$	5,898,047	$	16,813,056	$	124,407,623	$	166,471,297

At March

2019

Summary of financial position and income statements relating to investment in unconsolidated joint ventures

Summary financial information as of March 31, 2019

				Hamilton												Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,117,613		$	2,595,015		$	5,919,727		$	103,238		$	0		$	5,556,929		$	16,490,749		$	86,186,211		$	123,969,482
Rental property held for sale		0			0			0			159,188			0			0			0			0			159,188
Cash & Cash Equivalents		192,441			169,930			213,656			51,285			359,291			132,903			163,789			1,853,435			3,136,730
Rent Receivable		222,191			49,619			4,437			2,441			0			1,487			17,049			136,962			434,186
Real Estate Tax Escrow		72,624			—			50,334			—			0			28,960			95,525			0			247,443
Prepaid Expenses & Other Assets		274,111			110,681			61,989			30,377			3,595			16,287			105,663			1,022,670			1,625,373
Total Assets	$	7,878,980		$	2,925,245		$	6,250,143		$	346,529		$	362,886		$	5,736,566		$	16,872,775		$	89,199,278		$	129,572,402
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,910,371		$	—		$	9,442,200		$	—		$	—		$	5,898,047		$	16,813,056		$	124,407,623		$	166,471,297
Accounts Payable & Accrued Expense		84,485			2,187			121,342			10,844			10,951			61,051			205,044			701,699			1,197,603
Advance Rental Pmts & Security Deposits		297,683			—			283,486			7,174			101			123,167			391,075			2,620,890			3,723,576
Total Liabilities		10,292,539			2,187			9,847,028			18,018			11,052			6,082,265			17,409,175			127,730,212			171,392,476
Partners’ Capital		(2,413,559)			2,923,058			(3,596,885)			328,511			351,834			(345,699)			(536,400)			(38,530,934)			(41,820,074)
Total Liabilities and Capital	$	7,878,980		$	2,925,245		$	6,250,143		$	346,529		$	362,886		$	5,736,566		$	16,872,775		$	89,199,278		$	129,572,402
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,461,529		$			$	164,256		$	175,917		$			$			$				1,801,702
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,206,780)		$	—		$	(1,798,443)		$	—		$	—		$	(172,850)		$	(268,200)		$	(15,412,374)			(18,858,645)
Total Investment in Unconsolidated Joint Ventures (Net)																									$	(17,056,944)
Total units/condominiums
Apartments		48			—			40			175			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			3
Total		49			1			40			176			48			42			148			409			1,033
Units to be retained		49			1			40			—			—			42			148			409			690
Units to be sold		—			—			—			175			48			—			—			—			343
Units sold through May 1, 2019		—			—			—			173			48			—			—			—			221
Unsold units		—			—			—			3			—			—			—			—			3
Unsold units with deposits for future sale as of  May 1, 2019		—			—			—			1			—			—			—			—			1

Summary of income statement relating to investment in unconsolidated joint ventures

Financial information for the three months ended March 31, 2019

			Hamilton								Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	459,573	$	75,290	$	385,243	$	23,594	$	3,629	$	274,837	$	822,668		4,028,259	$	6,073,093
Laundry and Sundry Income		3,005		—		1,389		—		—		1,907		10,062		24,025		40,388
		462,578		75,290		386,632		23,594		3,629		276,744		832,730		4,052,284		6,113,481
Expenses
Administrative		5,379		2,092		5,390		1,694		3,445		3,716		17,847		55,532		95,095
Depreciation and Amortization		119,544		5,074		86,226		3,196		5,420		88,595		258,438		900,101		1,466,594
Management Fees		17,206		2,160		14,056		965		145		11,067		31,868		86,149		163,616
Operating		21,450		8		22,603		775		(109)		23,755		107,289		381,644		557,415
Renting		3,330		—		3,520						2,032		16,112		19,663		44,657
Repairs and Maintenance		37,884		—		18,467		8,040		10,266		36,672		124,192		256,585		492,106
Taxes and Insurance		61,830		15,677		40,241		7,349		4,906		32,251		104,431		518,726		785,411
		266,623		25,011		190,503		22,019		24,073		198,088		660,177		2,218,400		3,604,894
Income Before Other Income		195,955		50,279		196,129		1,575		(20,444)		78,656		172,553		1,833,884		2,508,587
Other Income (Loss)
Interest Expense		(121,005)		—		(94,247)				(6)		(57,991)		(188,268)		(1,270,103)		(1,731,620)
Gain on Sale of Real Estate				—		—		754		432,908								433,662
		(121,005)		—		(94,247)		754		432,902		(57,991)		(188,268)		(1,270,103)		(1,297,958)
Net Income (Loss)	$	74,950	$	50,279	$	101,882	$	2,329	$	412,458	$	20,665	$	(15,715)	$	563,781	$	1,210,629
Net Income (Loss)—NERA 50%	$	37,475	$	25,140	$	50,941	$	1,165	$	206,229	$	10,333	$	(7,858)				323,424
Net Income —NERA 40%															$	225,515		225,515
																	$	548,939

2018

Summary of financial position and income statements relating to investment in unconsolidated joint ventures

Summary financial information as March 31, 2018

				Hamilton												Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Bay Apts			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	7,515,492		$	2,597,633		$	6,242,990		$	887,890		$	1,583,448		$	5,854,350		$	17,359,777		$	89,284,170		$	131,325,750
Cash & Cash Equivalents		148,701			50,004			123,091			136,822			122,350			107,268			102,710			861,790			1,652,736
Rent Receivable		133,580			—			19,937			6,902			2,463			5,206			21,196			221,175			410,459
Real Estate Tax Escrow		83,760			—			46,751			—			—			32,229			152,782			349,904			665,426
Prepaid Expenses & Other Assets		80,429			279			50,269			586,555			693,936			17,475			95,705			2,668,635			4,193,283
Total Assets	$	7,961,962		$	2,647,916		$	6,483,038		$	1,618,169		$	2,402,197		$	6,016,528		$	17,732,170		$	93,385,674		$	138,247,654
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,896,582		$	—		$	9,627,636		$	—		$	—		$	5,889,863		$	16,797,004		$	81,509,648		$	123,720,733
Accounts Payable & Accrued Expense		74,966			2,188			87,137			8,434			9,554			55,333			169,932			634,933			1,042,477
Advance Rental Pmts& Security Deposits		341,039			—			245,550			12,555			10,975			112,103			321,274			2,608,580			3,652,076
Total Liabilities		10,312,587			2,188			9,960,323			20,989			20,529			6,057,299			17,288,210			84,753,161			128,415,286
Partners’ Capital		(2,349,625)			2,645,728			(3,477,285)			1,597,180			2,381,668			(40,771)			443,960			8,630,513			9,831,368
Total Liabilities and Capital	$	7,962,962		$	2,647,916		$	6,483,038		$	1,618,169		$	2,402,197		$	6,016,528		$	17,732,170		$	93,383,674		$	138,246,654
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$			$	1,322,863		$	—		$	798,589		$	1,190,833		$			$	221,979		$	3,452,204		$	6,986,470
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,174,814)		$	—		$	(1,738,644)		$	—		$	—		$	(20,387)		$	—		$	—			(2,933,844)
Total Investment in Unconsolidated Joint Ventures (Net)																									$	4,052,626
Total units/condominiums
Apartments		48			—			40			175			48			42			148			409			1,030
Commercial		1			1			—			1			—			—			—			—			3
Total		49			1			40			176			48			42			148			409			1,033
Units to be retained		49			1			40			0			0			42			148			409			690
Units to be sold		—			—			—			176			46			—			—			—			343
Units sold through May1, 2018		—			—			—			143			1			—			—			—			264
Unsold units		—			—			—			32			47			—			—			—			79
Unsold units with deposits for future sale as of May 1, 2018		—			—			—			4			10			—			—			—			14

Summary of income statement relating to investment in unconsolidated joint ventures

Financial information for the three months ended March 31, 2018

											Hamilton		Hamilton
	Hamilton		Hamilton Essex		345		Hamilton		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Bay Apts		Apts		Apts		Park		Total
Revenues
Rental Income	$	411,222	$	53,928	$	403,837	$	38,221	$	22,203	$	263,051	$	858,213	$	3,894,603	$	5,945,278
Laundry and Sundry Income		3,005		—		1,217		—		—		675		9,126		24,688		38,711
		414,227		53,928		405,054		38,221		22,203		263,726		867,339		3,919,291		5,983,989
Expenses
Administrative		9,680		488		6,455		1,499		3,066		1,824		13,127		65,429		101,568
Depreciation and Amortization		114,285		665		86,251		—		10,000		87,722		255,506		874,142		1,428,571
Management Fees		13,204		2,157		16,126		1,508		1,022		10,368		32,443		83,012		159,840
Operating		24,131		—		20,580		156		825		33,850		120,393		379,875		579,810
Renting		3,291		—		497		—		—		3,378		8,652		29,782		45,600
Repairs and Maintenance		54,501		4,163		21,497		40,207		34,224		19,617		182,374		318,666		675,249
Taxes and Insurance		62,527		16,723		41,631		18,171		16,459		31,046		104,551		419,289		710,397
		281,619		24,196		193,037		61,541		65,596		187,805		717,046		2,170,195		3,701,035
Income Before Other Income		132,608		29,732		212,017		(23,320)		(43,393)		75,921		150,293		1,749,096		2,282,954
Other Income (Loss)
Interest Expense		(99,313)		—		(96,961)		(26)		(49)		(58,519)		(188,239)		(1,166,238)		(1,609,345)
Interest Income				—		—						—		—		—		—
Gain on sale of real estate				—		—		817,006		827,757		—		—		—		1,644,763
		(99,313)		—		(96,961)		816,980		827,708		(58,519)		(188,239)		(1,166,238)		35,418
Net Income (Loss)	$	33,295	$	29,732	$	115,056	$	793,660	$	784,315	$	17,402	$	(37,946)	$	582,858	$	2,318,372
Net Income (Loss)—NERA 50%	$	16,648	$	14,866	$	57,528	$	396,830	$	392,158	$	8,701	$	(18,973)				867,757
Net Income (Loss)—NERA 40%															$	233,143		233,143
																	$	1,100,900

XML

SIGNIFICANT ACCOUNTING POLICIES (Business) (Details)	Mar. 31, 2019 ft² property item	Mar. 31, 2018 property
Line of Business
Number of units | property		1,033
Residential and mixed-use properties
Line of Business
Number of Real Estate Properties	23
Number of units	2,711
Residential buildings
Line of Business
Number of units | property		1,030
Commercial
Line of Business
Number of units | property		3
Condominium
Line of Business
Number of units	19
Wholly owned properties
Line of Business
Number of Real Estate Properties	27
Wholly owned properties | Residential buildings
Line of Business
Number of Real Estate Properties	19
Number of units	2,711
Wholly owned properties | Mixed use residential, retail and office buildings
Line of Business
Number of Real Estate Properties	4
Wholly owned properties | Commercial
Line of Business
Number of Real Estate Properties	3
Area of property (in square feet) | ft²	108,043
Wholly owned properties | Condominium
Line of Business
Number of Real Estate Properties	1
Number of units	19
Partially owned properties | Residential and mixed-use properties
Line of Business
Number of Real Estate Properties	8
Number of units	690
Area of property (in square feet) | ft²	12,500
Partially owned properties | Residential and mixed-use properties | Minimum
Line of Business
Ownership interest (as a percent)	40.00%
Partially owned properties | Residential and mixed-use properties | Maximum
Line of Business
Ownership interest (as a percent)	50.00%
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 | property	1,033
Investment Properties | Residential buildings
Line of Business
Number of units | property	1,030
Investment Properties | Commercial
Line of Business
Number of units | property	3
Investment Properties | Partially owned properties | Residential and mixed-use properties
Line of Business
Number of units | property	690

XML

SIGNIFICANT ACCOUNTING POLICIES (Details)		3 Months Ended		6 Months Ended
	Jan. 03, 2012	Mar. 31, 2019 USD ($) item shares	Mar. 31, 2018 USD ($)	Jun. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Dec. 31, 2018 USD ($)	Aug. 20, 2007
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		$ 55,000	$ 52,000
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
Federally uninsured amounts of cash and cash equivalents, and security deposits included in prepaid expenses and other assets		$ 7,406,000				$ 10,784,000
Advertising Expense
Advertising expense		$ 62,969	$ 44,381
Interest Capitalized
Capitalized interest				$ 0	$ 0
Minimum
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 | Cash and cash equivalents
Concentration of Credit Risks and Financial Instruments
Interest rate on interest bearing accounts (as a percent)		1.61%
Less Than Wholly Owned Subsidiaries [Member] | Minimum
Principles of Consolidation
Ownership interest in each subsidiary (as a percent)		99.67%
Less Than Wholly Owned Subsidiaries [Member] | Maximum
Principles of Consolidation
Ownership interest in each subsidiary (as a percent)		100.00%
Investment Properties
Principles of Consolidation
Number of limited liability companies/partnerships | item		8
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						0.1

XML

RENTAL PROPERTIES (Details)	3 Months Ended
	Mar. 31, 2019 USD ($) property item	Dec. 31, 2018 USD ($)	Mar. 31, 2018 property
RENTAL PROPERTIES
Number of units | property			1,033
Rental properties
Total fixed assets	$ 338,579,255	$ 337,902,411
Less: Accumulated depreciation	(110,919,198)	(107,391,148)
Total fixed assets, net	227,660,057	230,511,263
Land, improvements and parking lots
Rental properties
Total fixed assets	$ 72,547,547	72,547,547
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	$ 221,837,652	221,697,939
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	$ 12,247,767	12,134,519
Kitchen cabinets | Minimum
Rental properties
Useful Life	5 years
Kitchen cabinets | Maximum
Rental properties
Useful Life	10 years
Carpets
Rental properties
Total fixed assets	$ 7,773,940	7,591,591
Carpets | Minimum
Rental properties
Useful Life	5 years
Carpets | Maximum
Rental properties
Useful Life	10 years
Air conditioning
Rental properties
Total fixed assets	$ 603,149	603,149
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	$ 349,071	327,643
Laundry equipment | Minimum
Rental properties
Useful Life	5 years
Laundry equipment | Maximum
Rental properties
Useful Life	7 years
Elevators
Rental properties
Total fixed assets	$ 1,873,847	1,839,590
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	$ 13,016,249	12,919,389
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	216,260
Motor vehicles | Maximum
Rental properties
Useful Life	5 years
Fences
Rental properties
Total fixed assets	$ 38,213	38,213
Fences | Minimum
Rental properties
Useful Life	5 years
Fences | Maximum
Rental properties
Useful Life	15 years
Furniture and fixtures
Rental properties
Total fixed assets	$ 7,102,834	7,013,845
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	$ 528,097	$ 528,097
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 | item	27
Investment Properties
RENTAL PROPERTIES
Number of units | property	1,033
Residential and mixed-use properties
RENTAL PROPERTIES
Number of units | item	2,711
Number of properties | item	23
Residential and mixed-use properties | Partially owned properties
RENTAL PROPERTIES
Number of units | item	690
Number of properties | item	8
Residential and mixed-use properties | Partially owned properties | Minimum
RENTAL PROPERTIES
Ownership interest (as a percent)	40.00%
Residential and mixed-use properties | Partially owned properties | Maximum
RENTAL PROPERTIES
Ownership interest (as a percent)	50.00%
Residential and mixed-use properties | Investment Properties | Partially owned properties
RENTAL PROPERTIES
Number of units | property	690
Condominium
RENTAL PROPERTIES
Number of units | item	19
Condominium | Wholly owned properties
RENTAL PROPERTIES
Number of units | item	19
Number of properties | item	1

XML

RENTAL PROPERTIES (Webster Green Apartments) (Details)	Mar. 29, 2018 USD ($) item	Mar. 31, 2018 property
RENTAL PROPERTIES
Number of units | property		1,033
Webster Green Apartments
RENTAL PROPERTIES
Number of units | item	79
Loan amount	$ 21,500,000
Purchase price of real estate properties	34,500,000
Cash payment	13,000,000
Cash from reserves	5,000,000
Line of credit	8,000,000
Closing costs associated with financing	141,000
Purchase price allocated to the value of the in-place leases	502,000
Purchase price allocated to the value of the tenant relationships	$ 40,000
Amortization period of value of the in-place leases	12 months
Amortization period of value of the tenant relationships	24 months

XML

RENTAL PROPERTIES (Woodland Park Apartments) (Details)	Mar. 31, 2018 property
RENTAL PROPERTIES
Number of units	1,033

XML

RELATED PARTY TRANSACTIONS (Details)	3 Months Ended		12 Months Ended	24 Months Ended
	Mar. 31, 2019 USD ($) item	Mar. 31, 2018 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2019 USD ($)
RELATED PARTY TRANSACTIONS
Management fee as percentage of gross receipts rental revenue	4.00%
Management fee as a percentage of gross receipts rental revenue of Linewt, LLC	3.00%
Management fees of related party	$ 591,000	$ 560,000
Management fee	590,610	559,629
Repairs and maintenance	1,944,231	1,814,283
Administrative expense	612,757	539,145
Employer contributions in 401K plan	$ 12,000
Number of limited partnerships and limited liability companies in which the entity has invested | item	8
Interest expense	$ 3,000,289	2,984,210
Dexter Park
RELATED PARTY TRANSACTIONS
Management fee as percentage of gross receipts rental revenue	2.00%
President of Management Company
RELATED PARTY TRANSACTIONS
Quarterly fee for asset management consulting services		18,750
Harold Brown | Minimum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	47.60%
Harold Brown | Maximum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	59.00%
General Partner or Management Company [Member]
RELATED PARTY TRANSACTIONS
Repairs and maintenance	$ 108,000
Administrative expense	90,000
Commercial brokerage fees	1,000
Expenses for construction, architectural services and supervision of capital projects	150,000
Costs related to professional services	349,000	354,000
Management Company [Member]
RELATED PARTY TRANSACTIONS
Reimbursement to related party for payroll transfers	789,000	824,000
Employer contributions in 401K plan	$ 12,000		$ 0
Number of accounting staff of related party providing bookkeeping and accounting functions | item	14
Fees for accounting and bookkeeping services	$ 31,250	$ 31,250
Number of employees having ownership interest in the investment properties | item	5
Fees for accounting and bookkeeping services per year				$ 125,000
Partially owned properties
RELATED PARTY TRANSACTIONS
Management fee as percentage of gross receipts rental revenue	4.00%
Management fee	$ 163,000
Repairs and maintenance	18,000
Administrative expense	11,000
Commercial brokerage fees	121,000
Construction, architectural services and supervision of capital projects	3,000
Amount paid to related party	$ 316,000
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 | Maximum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	50.00%

XML

OTHER ASSETS (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
OTHER ASSETS
Security deposits	$ 2,639,000	$ 2,571,000
Escrow deposits to fund future capital improvements	494,000	477,000
Deposits and escrows held for acquisitions	471,913	495,824
Intangible assets, net of accumulated amortization	18,000	152,000
Financing fees, net	68,000	78,000
Accumulated amortization on intangible assets	$ 1,093,000	$ 959,000

XML

MORTGAGE NOTES PAYABLE (Mortgages Payable) (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
MORTGAGE NOTES PAYABLE
Effective interest rate (as a percent)	3.94%
Financing fees, net	$ 68,000	$ 78,000
Accumulated amortization on financing and leasing fees	60,000	50,000
Annual maturities of mortgage debt
2020-current maturities	4,319,000
2021	2,049,000
2022	2,606,000
2023	67,098,000
2024	38,362,000
Thereafter	138,804,000
Total	253,238,000
Less: unamortized deferred financing costs	(1,285,000)
Secured Debt	251,953,066	252,370,843
Mortgages payable
MORTGAGE NOTES PAYABLE
Amount of monthly installments including principal	$ 1,139,000
Weighted average interest rate (as a percent)	4.63%
Effective interest rate (as a percent)	4.71%
Financing fees, net	$ 1,354,000	1,420,000
Accumulated amortization on financing and leasing fees	$ 1,363,000	$ 1,298,000
Mortgages payable | Minimum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)	3.76%
Mortgages payable | Maximum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)	5.81%

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MORTGAGE NOTES PAYABLE (Mortgage by property) (Details)	Mar. 29, 2018 USD ($) item	Mar. 12, 2018 USD ($)	Mar. 31, 2019 property	Mar. 31, 2018 property	Aug. 31, 2014	Dec. 31, 2005	Mar. 07, 2005 item
MORTGAGE NOTES PAYABLE
Number of units | property				1,033
Hamilton Essex 81
MORTGAGE NOTES PAYABLE
Number of units			49	49			48
Webster Green Apartments
MORTGAGE NOTES PAYABLE
Number of units | item	79
Loan amount	$ 21,500,000
Purchase price of real estate properties	34,500,000
Cash payment	13,000,000
Cash from reserves	5,000,000
Line of credit	8,000,000
Closing Costs	$ 141,000
659 Worcester Road
MORTGAGE NOTES PAYABLE
Loan amount		$ 6,083,683
Closing Costs		$ 69,000
Interest rate (as a percent)		4.87%
Amortization period of debt		30 years
Future monthly payment amount		$ 32,427
Mortgages payable | Hamilton on Main Apartments, LLC
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)					4.34%	5.18%
Amortization period of debt						30 years
Mortgages payable | Minimum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)			3.76%
Mortgages payable | Maximum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)			5.81%

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MORTGAGE NOTES PAYABLE (Line of Credit) (Details)					1 Months Ended					3 Months Ended		12 Months Ended
	Jun. 04, 2018 USD ($)	Sep. 29, 2017 USD ($)	Sep. 30, 2015	Jul. 31, 2014 USD ($) item	May 31, 2019 USD ($)	Jan. 31, 2019 USD ($)	Oct. 31, 2018 USD ($)	Jul. 31, 2018 USD ($)	Aug. 31, 2014	Mar. 31, 2019 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2005	Mar. 29, 2018 USD ($)	Jul. 16, 2017 USD ($)	Mar. 07, 2005 item
Line of Credit
Interest expense										$ 3,000,289	$ 2,984,210
Line Of Credit Facility Unused Capacity Commitment Fee										12,000
Webster Green Apartments
Line of Credit
Loan amount													$ 21,500,000
Credit line balance													8,000,000
Hamilton Essex 81
Line of Credit
Number of properties in which borrowing amount collateralized | item															1
Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts | Subsequent event
Line of Credit
Term of debt					10 years
Loan amount					$ 20,750,000
Minimum
Line of Credit
Tangible net worth										$ 150,000,000
Ratio of net operating income to total indebtedness										9.50%
Debt service coverage ratio										1.6
Maximum
Line of Credit
Leverage ratio										65.00%
Aggregate increase in indebtedness										$ 15,000,000
Mortgages payable | Hamilton Essex 81
Line of Credit
Term of debt			10 years
Mortgages payable | Hamilton on Main Apartments, LLC
Line of Credit
Term of debt									10 years			10 years
Mortgages payable | LIBOR | Hamilton Essex 81
Line of Credit
Margin over basis of interest rate (as a percent)			2.18%
Line of Credit
Line of Credit
Maximum borrowings				$ 25,000,000
Term of debt				3 years
Payment on line of credit		$ 8,000,000				$ 2,000,000	$ 3,000,000	$ 4,000,000
Amount of refinancing costs										$ 128,000
Credit line balance														$ 25,000,000
Number of properties in which borrowing amount collateralized | item				23
Line of Credit | Dexter Park
Line of Credit
Payment on line of credit	$ 16,000,000
Line of Credit | Hamilton Highlands LLC Residential Needham Massachusetts [Member]
Line of Credit
Funds drawn by the company													$ 8,000,000
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%
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%

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ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS (Details)	3 Months Ended
	Mar. 31, 2019 USD ($)
ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS
Period for advance rental payment	1 month
Amount received for prepaid rent	$ 2,234,000
Security deposits	$ 2,639,000

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PARTNERS' CAPITAL (Details)		1 Months Ended	3 Months Ended
	Jan. 03, 2012	Jan. 31, 2019 $ / item	Mar. 31, 2019 item $ / item	Mar. 31, 2018 $ / item	Dec. 31, 2018 $ / item	Sep. 30, 2018 $ / item	Jun. 30, 2018 $ / item	Aug. 20, 2007
Depositary receipts exchange ratio for Class A units | item			30
Quarterly distribution per unit approved (in dollars per unit)		9.60
Quarterly distributions per depositary receipt (in dollars per receipt)		0.32		0.30	0.30	0.30	0.30
Quarterly distribution per unit (in dollars per unit)				9.00	9.00	9.00	9.00
Earnings per depository receipt
Net Income per Depositary Receipt (in dollars per receipt)			0.41	0.50
Distributions per Depositary Receipt (in dollars per share)			0.32	0.30
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%
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							0.1
Class B
Fixed distribution percentage of unit holders			19.00%

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TREASURY UNITS (Details)				1 Months Ended			3 Months Ended	132 Months Ended	139 Months Ended
	Mar. 10, 2015 shares	Aug. 31, 2007 $ / item shares	Aug. 20, 2007 shares	May 03, 2019 USD ($) $ / item shares	Apr. 30, 2019 USD ($) shares	Sep. 30, 2007 $ / item shares	Mar. 31, 2019 USD ($) $ / item shares	Dec. 31, 2018 $ / item shares	Mar. 31, 2019 USD ($) $ / item shares	Mar. 06, 2008 shares
Treasury units							57,634		57,634
Period for repurchase of depository receipts	5 years		12 months
Depository receipts authorized to be repurchased	2,000,000		300,000							1,500,000
Number of depository receipts repurchased		1,408				1,408	1,408	1,408
Repurchase price of depository receipts (in dollars per receipt) | $ / item									27.97
Units required to be repurchased (in shares)							1,795
Total cost of repurchase | $							$ 2,930,736		$ 43,205,000
Subsequent event
Number of depository receipts repurchased				1,540
Repurchase price of depository receipts (in dollars per receipt) | $ / item				64.91
Total cost of repurchase | $				$ 96,861
General Partnership
Treasury units							577		577
Fixed distribution percentage of unit holders							1.00%
Number of depository receipts repurchased		180				180	180	180
Units required to be repurchased (in shares)							18
Total cost of repurchase | $							$ 29,307
Value of units required to be repurchased | $							$ 29,307
General Partnership | Subsequent event
Units required to be repurchased (in shares)					1
Value of units required to be repurchased | $					$ 1,249
Treasury Units
Units required to be repurchased (in shares)							1,795
Class A
Treasury units							46,107		46,107
Fixed distribution percentage of unit holders							80.00%
Repurchase price of units (in dollars per unit) | $ / item		839.10				839.10	839.10	839.10
Total cost of repurchase | $							$ 2,344,601
Class B
Treasury units							10,950		10,950
Fixed distribution percentage of unit holders							19.00%
Number of depository receipts repurchased		3,413				3,413	3,413	3,413
Total cost of repurchase | $							$ 556,828
Class B | Subsequent event
Units required to be repurchased (in shares)					12
Value of units required to be repurchased | $					$ 23,740
Class B
Value of units required to be repurchased | $							$ 556,828
Class B | General Partnership
Units required to be repurchased (in shares)							341
Repurchase price of units (in dollars per unit) | $ / item		996.79				996.79	996.79	996.79
Treasury Units
Repurchase price of depository receipts (in dollars per receipt) | $ / item							54.40
Units required to be repurchased (in shares)							43,095
Repurchase price of units (in dollars per unit) | $ / item							1,632.12
Total cost of repurchase | $							$ 2,344,601

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COMMITMENTS AND CONTINGENCIES (Details)	3 Months Ended
	Mar. 31, 2019 USD ($)	Feb. 28, 2019 item
COMMITMENTS AND CONTINGENCIES
Number of apartments damaged | item		40
Proceeds from Insurance	$ 75,000
Insurance recovery receivable	$ 212,000

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RENTAL INCOME (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
RENTAL INCOME
Percentage of rental income related to residential apartments and condominium units with leases of one year or less	94.00%
Maximum period of non-cancelable operating lease	1 year
Percentage of rental income related to commercial properties	6.00%
Minimum future rental income
2020	$ 2,565,000
2021	2,299,000
2022	1,591,000
2023	946,000
2024	523,000
Thereafter	756,000
Commercial Property Leases	8,680,000
Aggregate contingent rentals from continuing operations	$ 129,000	$ 223,000

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RENTAL INCOME (Concentration) (Details)	3 Months Ended
	Mar. 31, 2019
Commercial rental income | Major tenant
Concentration Risk
Concentration risk percentage	36.00%

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RENTAL INCOME (Commercial Leases) (Details)	3 Months Ended
	Mar. 31, 2019 USD ($) ft² item
RENTAL INCOME
Annual base rent for expiring leases | $	$ 2,887,127
Total square feet for expiring leases | ft²	106,683
Total number of leases expiring | item	45
Percentage of annual base rent for expiring leases	100.00%
Through March 31, 2020
RENTAL INCOME
Annual base rent for expiring leases | $	$ 454,412
Total square feet for expiring leases | ft²	22,400
Total number of leases expiring | item	12
Percentage of annual base rent for expiring leases	16.00%
Through March 31, 2021
RENTAL INCOME
Annual base rent for expiring leases | $	$ 225,337
Total square feet for expiring leases | ft²	5,679
Total number of leases expiring | item	7
Percentage of annual base rent for expiring leases	8.00%
Through March 31, 2022
RENTAL INCOME
Annual base rent for expiring leases | $	$ 1,143,867
Total square feet for expiring leases | ft²	47,854
Total number of leases expiring | item	10
Percentage of annual base rent for expiring leases	39.00%
Through March 31, 2023
RENTAL INCOME
Annual base rent for expiring leases | $	$ 246,341
Total square feet for expiring leases | ft²	7,087
Total number of leases expiring | item	4
Percentage of annual base rent for expiring leases	9.00%
Through March 31, 2024
RENTAL INCOME
Annual base rent for expiring leases | $	$ 658,784
Total square feet for expiring leases | ft²	19,209
Total number of leases expiring | item	8
Percentage of annual base rent for expiring leases	22.00%
Through March 31, 2025
RENTAL INCOME
Annual base rent for expiring leases | $	$ 15,936
Total square feet for expiring leases | ft²	604
Total number of leases expiring | item	3
Percentage of annual base rent for expiring leases	1.00%
Through March 31, 2030
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 ($)	Mar. 31, 2019	Dec. 31, 2018
RENTAL INCOME
Allowance for doubtful rent receivable	$ 369,000	$ 532,000
Recognizing rental income from non-cancelable commercial leases with future rental increases on a straight-line basis	69,000
Deferred rental concession	$ 82,000

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CASH FLOW INFORMATION (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
CASH FLOW INFORMATION
Cash paid for interest	$ 2,944,000	$ 3,010,000
Cash paid for state income taxes	48,000	$ 47,000
Non-cash financing activities in connection with acquisition	$ 21,000,000

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FAIR VALUE MEASUREMENTS (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Mortgage Notes Payable
Carrying Amount	$ 251,953,066	$ 252,370,843
Estimated Fair Value	235,100,502	233,362,501
Partially owned properties
Mortgage Notes Payable
Carrying Amount	166,471,296	166,492,692
Estimated Fair Value	$ 163,347,932	$ 160,956,055

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TAXABLE INCOME AND TAX BASIS (Details)	3 Months Ended
	Mar. 31, 2019 USD ($)
TAXABLE INCOME AND TAX BASIS
Taxable net income	$ 4,841,000
Excess amount of statement income over taxable income	672,000
Excess amount of cumulative statement basis over cumulative taxable basis	878,000
Excess amount of statement income from joint venture investments over taxable income	$ 1,121,000

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Details)	3 Months Ended
	Mar. 31, 2019 item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of limited partnerships and limited liability companies in which the entity has invested	8
Number of partnerships investing in commercial property	3
Limited Partnerships
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of limited partnerships and limited liability companies in which the entity has invested	8
Management Company [Member]
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of employees having ownership interest in the investment properties	5
Minimum | Limited Partnerships
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	40.00%
Minimum | Harold Brown
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	47.60%
Maximum | Limited Partnerships
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	50.00%
Maximum | Harold Brown
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	59.00%

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Dexter) (Details)			3 Months Ended
	May 31, 2018 USD ($)	Oct. 28, 2009 USD ($) item	Mar. 31, 2019 USD ($)	Sep. 30, 2018 USD ($)	Mar. 31, 2018 USD ($) property	Dec. 31, 2018 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 1,801,702		$ 6,986,470	$ 1,985,680
Number of units | property					1,033
Outstanding amount of mortgage			251,953,066			$ 252,370,843
Distribution to the Partnership			1,177,353		$ 1,119,481
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 15,925,000			$ 3,452,204
Ownership interest (as a percent)		40.00%			40.00%
Number of units		409			409
Purchase price of investments		$ 129,500,000
Outstanding amount of mortgage	$ 82,000,000		125,000,000
Distribution to the Partnership	41,200,000
Dexter Park | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Loan amount		$ 89,914,000
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
John Hancock | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Loan amount	$ 125,000,000
Interest rate (as a percent)	3.99%
Defeasance cost				$ 3,830,000
Defeasance cost (as a percent)				40.00%
General Partnership
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Distribution to the Partnership			$ 11,774		$ 11,195
General Partnership | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Distribution to the Partnership	$ 16,500,000
General Partnership | John Hancock | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Defeasance cost				$ 1,532,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property					1,030
Residential buildings | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property					409

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Bay Apts and Sales) (Details)	1 Months Ended	3 Months Ended
	Feb. 28, 2007 USD ($) item	Mar. 31, 2019 USD ($) property	Dec. 31, 2018 USD ($)	Mar. 31, 2018 USD ($) property	Mar. 01, 2017 USD ($)	Oct. 03, 2005 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 1,801,702	$ 1,985,680	$ 6,986,470
Number of units | property				1,033
Number of units retained for long-term investment | property				(690)
Outstanding amount of mortgage		251,953,066	$ 252,370,843
Unsold units | property				79
Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 175,917		$ 1,190,833		$ 2,500,000
Ownership interest (as a percent)				50.00%		50.00%
Number of units		48		48		168
Number of units sold | item						120
Number of units retained for long-term investment				0		48
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
Outstanding amount of mortgage					$ 2,222,000
Gain on the sale of real estate		$ 433,000
Unsold units | property				47
Purchase price of investments						$ 30,875,000
Borrowings	$ 4,750,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				1,030
Residential buildings | Hamilton Bay Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units	48	48		48
Mortgages payable | Minimum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)		3.76%
Mortgages payable | Maximum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)		5.81%

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Essex) (Details)				3 Months Ended
	Sep. 30, 2015 USD ($)	Sep. 28, 2015 USD ($)	Mar. 07, 2005 USD ($) item	Mar. 31, 2019 USD ($) property	Mar. 31, 2018 USD ($) property	Dec. 31, 2018 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 1,801,702	$ 6,986,470	$ 1,985,680
Number of units | property					1,033
Distribution to the Partnership				1,177,353	$ 1,119,481
Mortgage Notes Payable				$ 251,953,066		$ 252,370,843
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 investments			$ 14,300,000
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)					50.00%
Number of units			48	49	49
Number of properties in which borrowing amount collateralized | item			1
Capital contributions		$ 100,000
Distribution to the Partnership	$ 978,193
Hamilton Essex Development
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 1,461,529	$ 1,322,863
Ownership interest (as a percent)					50.00%
Number of units | property				1	1
Capacity of real estate property (in cars per lot) | item			50
Capital contributions		978,193
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property					1,030
Residential buildings | Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				48	48
Commercial
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property					3
Commercial | Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				1	1
Commercial | Hamilton Essex Development
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				1	1
Mortgages payable | Maximum
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)				5.81%
Mortgages payable | Hamilton Essex Development, LLC and Hamilton Essex 81, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Borrowings			$ 10,750,000
Mortgages payable | Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Amount of loan proceeds utilized for pay off the existing mortgage	$ 8,040,719
Term of debt	10 years
Mortgage Notes Payable				$ 10,000,000
Borrowings	$ 10,000,000
Mortgages payable | Hamilton Essex 81 | LIBOR
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Margin over basis of interest rate (as a percent)	2.18%
Mortgages payable | Hamilton Essex Development
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Repayment of loan		$ 1,952,286

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton 1025) (Details)			3 Months Ended
	Jul. 08, 2016 USD ($)	Mar. 02, 2005 USD ($) item	Mar. 31, 2019 property item	Mar. 31, 2019 item	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Mar. 31, 2018 USD ($) property
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture | $					$ 1,801,702	$ 1,985,680	$ 6,986,470
Number of units | property							1,033
Unsold units | property							79
Number of units retained for long-term investment | property							(690)
Outstanding amount of mortgage | $					251,953,066	$ 252,370,843
Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture | $		$ 2,352,000			$ 164,256		$ 798,589
Ownership interest (as a percent)		50.00%					50.00%
Number of units		176	176	3			176
Number of units sold | item		127
Unsold units | property			3				32
Number of units retained for long-term investment		49					0
Capital contributions | $	$ 2,359,500
Number of units under a purchase and sale agreement | item			1
Purchase price of investments | $		$ 23,750,000
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 | property							1,030
Residential buildings | Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property			175				175

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Minuteman) (Details)		1 Months Ended		3 Months Ended
	Sep. 12, 2016 USD ($)	Jan. 31, 2007 USD ($)	Oct. 31, 2004 USD ($)	Mar. 31, 2019 USD ($) property	Mar. 31, 2018 USD ($) property	Dec. 31, 2018 USD ($)	Dec. 31, 2006 USD ($)	Sep. 30, 2004 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 1,801,702	$ 6,986,470	$ 1,985,680
Number of units | property					1,033
Distribution to the Partnership				1,177,353	$ 1,119,481
Outstanding amount of mortgage				$ 251,953,066		$ 252,370,843
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture								$ 5,075,000
Ownership interest (as a percent)					50.00%			50.00%
Number of units				42	42			42
Cash contribution by the entity towards loan							$ 1,250,000
Outstanding amount of mortgage				$ 6,000,000
Purchase price of investments								$ 10,100,000
Amount returned to partnership			$ 3,775,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property					1,030
Residential buildings | Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				42	42
Mortgages payable | Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Distribution to the Partnership	$ 385,000
Mortgage amount	6,000,000
Term of debt		10 years
Amount of mortgage paid off	5,158,000
Refinancing costs	$ 123,000
Interest rate (as a percent)	3.71%	5.67%
Period for which the entity is required to make interest only payments	15 years	5 years
Amortization period of debt		30 years
Borrowings		$ 5,500,000	$ 8,025,000

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton on Main) (Details)	1 Months Ended	3 Months Ended		12 Months Ended
	Aug. 31, 2014 USD ($)	Mar. 31, 2019 USD ($)	Mar. 31, 2018 USD ($) property	Dec. 31, 2005 USD ($) item	Dec. 31, 2018 USD ($)	Aug. 31, 2004 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 1,801,702	$ 6,986,470		$ 1,985,680
Number of units | property			1,033
Outstanding amount of mortgage		251,953,066			$ 252,370,843
Distribution to the Partnership		1,177,353	$ 1,119,481
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 221,979			$ 8,000,000
Ownership interest (as a percent)			50.00%			50.00%
Number of units			148			280
Number of units sold | item						137
Purchase price of investments						$ 56,000,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property			1,030
Residential buildings | Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property			148
Mortgages payable | Hamilton on Main Apartments, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt	10 years			10 years
Number of buildings | item				3
Outstanding amount of mortgage		$ 16,900,000
Interest rate (as a percent)	4.34%			5.18%
Period for which the entity is required to make interest only payments				3 years
Amortization period of debt				30 years
Debt Instrument, Loan Proceeds distributed to the Partnership	$ 850,000
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
Repayment of loan	15,205,000
Cost associated with loan extension	161,000
Borrowings	$ 16,900,000			$ 16,825,000

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (345 Franklin) (Details)	1 Months Ended	3 Months Ended
	Jun. 30, 2013 USD ($)	Mar. 31, 2019 USD ($) property	Mar. 31, 2018 USD ($) property	Dec. 31, 2018 USD ($)	Nov. 30, 2001 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 1,801,702	$ 6,986,470	$ 1,985,680
Number of units | property			1,033
Distribution to the Partnership		1,177,353	$ 1,119,481
Outstanding amount of mortgage		$ 251,953,066		$ 252,370,843
Maximum | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)		5.81%
345 Franklin | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage		$ 9,504,000
Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property			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%
Number of units		40	40		40
Distribution to the Partnership	$ 1,610,000
Legal obligation to fund operating results		$ 0
345 Franklin | Mortgages payable
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
Repayment of loan	$ 6,776,000
Borrowings	$ 10,000,000
345 Franklin | Residential buildings
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property		40	40

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Balance Sheet) (Details)	Mar. 31, 2019 property	Mar. 31, 2019 item	Mar. 31, 2019 USD ($)	Mar. 31, 2019	Dec. 31, 2018 USD ($)	Mar. 31, 2018 USD ($) property	Oct. 28, 2009 USD ($) item	Feb. 28, 2007 item	Oct. 03, 2005 USD ($) item	Mar. 07, 2005 item	Mar. 02, 2005 USD ($) item	Sep. 30, 2004 USD ($) item	Aug. 31, 2004 USD ($) item	Nov. 30, 2001 USD ($) item
ASSETS
Rental Properties						$ 131,325,750
Cash & Cash Equivalents						1,652,736
Rent Receivable						410,459
Real Estate Tax Escrow						665,426
Prepaid Expenses & Other Assets						4,193,283
Total Assets						138,247,654
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable						123,720,733
Accounts Payable and Accrued Expenses						1,042,477
Advance Rental Payments and Security Deposits						3,652,076
Total Liabilities						128,415,286
Partners' Capital						9,831,368
Total Liabilities and Capital						138,246,654
Investment in Unconsolidated Joint Ventures			$ 1,801,702		$ 1,985,680	6,986,470
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture			(18,858,645)		$ (18,351,562)	(2,933,844)
Total Investment in Unconsolidated Joint Ventures (Net)						$ 4,052,626
Total units/ condominiums
Total | property						1,033
Units to be retained | property						690
Units to be sold | property						343
Total number of units sold | property						264
Unsold units | property						79
Units unsold with deposits for future sale | property						14
NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA				50.00%		50.00%
NERA 40%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA				40.00%		40.00%
Residential buildings
Total units/ condominiums
Total | property						1,030
Commercial
Total units/ condominiums
Total | property						3
Investment Properties
ASSETS
Rental Properties			123,969,482
Assets held for sales			159,188
Cash & Cash Equivalents			3,136,730
Rent Receivable			434,186
Real Estate Tax Escrow			247,443
Prepaid Expenses & Other Assets			1,625,373
Total Assets			129,572,402
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			166,471,297
Accounts Payable and Accrued Expenses			1,197,603
Advance Rental Payments and Security Deposits			3,723,576
Total Liabilities			171,392,476
Partners' Capital			(41,820,074)
Total Liabilities and Capital			129,572,402
Investment in Unconsolidated Joint Ventures			1,801,702
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture			(18,858,645)
Total Investment in Unconsolidated Joint Ventures (Net)			(17,056,944)
Total units/ condominiums
Total | property	1,033
Units to be retained | property	690
Units to be sold | property	343
Total number of units sold | property	221
Unsold units | property	3
Units unsold with deposits for future sale | property	1
Investment Properties | Residential buildings
Total units/ condominiums
Total | property	1,030
Investment Properties | Commercial
Total units/ condominiums
Total | property	3
Hamilton Essex 81
ASSETS
Rental Properties			7,117,613			$ 7,515,492
Assets held for sales			0
Cash & Cash Equivalents			192,441			148,701
Rent Receivable			222,191			133,580
Real Estate Tax Escrow			72,624			83,760
Prepaid Expenses & Other Assets			274,111			80,429
Total Assets			7,878,980			7,961,962
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			9,910,371			9,896,582
Accounts Payable and Accrued Expenses			84,485			74,966
Advance Rental Payments and Security Deposits			297,683			341,039
Total Liabilities			10,292,539			10,312,587
Partners' Capital			(2,413,559)			(2,349,625)
Total Liabilities and Capital			7,878,980			$ 7,962,962
Partners' Capital % - NERA						50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture			(1,206,780)			$ (1,174,814)
Total units/ condominiums
Total	49					49				48
Units to be retained | property	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 | property	48					48
Hamilton Essex 81 | Commercial
Total units/ condominiums
Total | property	1					1
Hamilton Essex Development
ASSETS
Rental Properties			2,595,015			$ 2,597,633
Assets held for sales			0
Cash & Cash Equivalents			169,930			50,004
Rent Receivable			49,619
Prepaid Expenses & Other Assets			110,681			279
Total Assets			2,925,245			2,647,916
LIABILITIES AND PARTNERS' CAPITAL
Accounts Payable and Accrued Expenses			2,187			2,188
Total Liabilities			2,187			2,188
Partners' Capital			2,923,058			2,645,728
Total Liabilities and Capital			2,925,245			$ 2,647,916
Partners' Capital % - NERA						50.00%
Investment in Unconsolidated Joint Ventures			1,461,529			$ 1,322,863
Total units/ condominiums
Total | property	1					1
Units to be retained | property	1					1
Hamilton Essex Development | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA				50.00%
Hamilton Essex Development | Commercial
Total units/ condominiums
Total | property	1					1
345 Franklin
ASSETS
Rental Properties			5,919,727			$ 6,242,990
Assets held for sales			0
Cash & Cash Equivalents			213,656			123,091
Rent Receivable			4,437			19,937
Real Estate Tax Escrow			50,334			46,751
Prepaid Expenses & Other Assets			61,989			50,269
Total Assets			6,250,143			6,483,038
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			9,442,200			9,627,636
Accounts Payable and Accrued Expenses			121,342			87,137
Advance Rental Payments and Security Deposits			283,486			245,550
Total Liabilities			9,847,028			9,960,323
Partners' Capital			(3,596,885)			(3,477,285)
Total Liabilities and Capital			6,250,143			$ 6,483,038
Partners' Capital % - NERA						50.00%								50.00%
Investment in Unconsolidated Joint Ventures														$ 1,533,000
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture			(1,798,443)			$ (1,738,644)
Total units/ condominiums
Total	40					40								40
Units to be retained | property	40					40
345 Franklin | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA				50.00%
345 Franklin | Residential buildings
Total units/ condominiums
Total | property	40					40
Hamilton 1025
ASSETS
Rental Properties			103,238			$ 887,890
Assets held for sales			159,188
Cash & Cash Equivalents			51,285			136,822
Rent Receivable			2,441			6,902
Prepaid Expenses & Other Assets			30,377			586,555
Total Assets			346,529			1,618,169
LIABILITIES AND PARTNERS' CAPITAL
Accounts Payable and Accrued Expenses			10,844			8,434
Advance Rental Payments and Security Deposits			7,174			12,555
Total Liabilities			18,018			20,989
Partners' Capital			328,511			1,597,180
Total Liabilities and Capital			346,529			$ 1,618,169
Partners' Capital % - NERA						50.00%					50.00%
Investment in Unconsolidated Joint Ventures			164,256			$ 798,589					$ 2,352,000
Total units/ condominiums
Total	176	3				176					176
Units to be retained						0					(49)
Units to be sold | property	175					176
Total number of units sold | property	173					143
Unsold units | property	3					32
Units unsold with deposits for future sale | property	1					4
Hamilton 1025 | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA				50.00%
Hamilton 1025 | Residential buildings
Total units/ condominiums
Total | property	175					175
Hamilton 1025 | Commercial
Total units/ condominiums
Total | property	1					1
Hamilton Bay Apts
ASSETS
Rental Properties			0			$ 1,583,448
Assets held for sales			0
Cash & Cash Equivalents			359,291			122,350
Rent Receivable			0			2,463
Real Estate Tax Escrow			0
Prepaid Expenses & Other Assets			3,595			693,936
Total Assets			362,886			2,402,197
LIABILITIES AND PARTNERS' CAPITAL
Accounts Payable and Accrued Expenses			10,951			9,554
Advance Rental Payments and Security Deposits			101			10,975
Total Liabilities			11,052			20,529
Partners' Capital			351,834			2,381,668
Total Liabilities and Capital			362,886			$ 2,402,197
Partners' Capital % - NERA						50.00%			50.00%
Investment in Unconsolidated Joint Ventures			175,917			$ 1,190,833			$ 2,500,000
Total units/ condominiums
Total	48					48			168
Units to be retained						0			(48)
Units to be sold | property	48					46
Total number of units sold | property	48					1
Unsold units | property						47
Units unsold with deposits for future sale | property						10
Hamilton Bay Apts | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA				50.00%
Hamilton Bay Apts | Residential buildings
Total units/ condominiums
Total	48					48		48
Hamilton Minuteman
ASSETS
Rental Properties			5,556,929			$ 5,854,350
Assets held for sales			0
Cash & Cash Equivalents			132,903			107,268
Rent Receivable			1,487			5,206
Real Estate Tax Escrow			28,960			32,229
Prepaid Expenses & Other Assets			16,287			17,475
Total Assets			5,736,566			6,016,528
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			5,898,047			5,889,863
Accounts Payable and Accrued Expenses			61,051			55,333
Advance Rental Payments and Security Deposits			123,167			112,103
Total Liabilities			6,082,265			6,057,299
Partners' Capital			(345,699)			(40,771)
Total Liabilities and Capital			5,736,566			$ 6,016,528
Partners' Capital % - NERA						50.00%						50.00%
Investment in Unconsolidated Joint Ventures												$ 5,075,000
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture			(172,850)			$ (20,387)
Total units/ condominiums
Total	42					42						42
Units to be retained | property	42					42
Hamilton Minuteman | NERA 50%
LIABILITIES AND PARTNERS' CAPITAL
Partners' Capital % - NERA				50.00%
Hamilton Minuteman | Residential buildings
Total units/ condominiums
Total | property	42					42
Hamilton on Main Apts
ASSETS
Rental Properties						$ 17,359,777
Cash & Cash Equivalents						102,710
Rent Receivable						21,196
Real Estate Tax Escrow						152,782
Prepaid Expenses & Other Assets						95,705
Total Assets						17,732,170
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			16,813,056			16,797,004
Accounts Payable and Accrued Expenses						169,932
Advance Rental Payments and Security Deposits						321,274
Total Liabilities						17,288,210
Partners' Capital						443,960
Total Liabilities and Capital						$ 17,732,170
Partners' Capital % - NERA						50.00%							50.00%
Investment in Unconsolidated Joint Ventures						$ 221,979							$ 8,000,000
Total units/ condominiums
Total						148							280
Units to be retained | property						148
Hamilton on Main Apts | NERA 50%
ASSETS
Rental Properties			16,490,749
Assets held for sales			0
Cash & Cash Equivalents			163,789
Rent Receivable			17,049
Real Estate Tax Escrow			95,525
Prepaid Expenses & Other Assets			105,663
Total Assets			16,872,775
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			16,813,056
Accounts Payable and Accrued Expenses			205,044
Advance Rental Payments and Security Deposits			391,075
Total Liabilities			17,409,175
Partners' Capital			(536,400)
Total Liabilities and Capital			16,872,775
Partners' Capital % - NERA				50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture			(268,200)
Total units/ condominiums
Total | property	148
Units to be retained | property	148
Hamilton on Main Apts | Residential buildings
Total units/ condominiums
Total | property						148
Hamilton on Main Apts | Residential buildings | NERA 50%
Total units/ condominiums
Total | property	148
Dexter Park
ASSETS
Rental Properties						$ 89,284,170
Cash & Cash Equivalents						861,790
Rent Receivable						221,175
Real Estate Tax Escrow						349,904
Prepaid Expenses & Other Assets						2,668,635
Total Assets						93,385,674
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			124,407,623			81,509,648
Accounts Payable and Accrued Expenses						634,933
Advance Rental Payments and Security Deposits						2,608,580
Total Liabilities						84,753,161
Partners' Capital						8,630,513
Total Liabilities and Capital						$ 93,383,674
Partners' Capital % - NERA						40.00%	40.00%
Investment in Unconsolidated Joint Ventures						$ 3,452,204	$ 15,925,000
Total units/ condominiums
Total						409	409
Units to be retained | property						409
Dexter Park | NERA 40%
ASSETS
Rental Properties			86,186,211
Assets held for sales			0
Cash & Cash Equivalents			1,853,435
Rent Receivable			136,962
Real Estate Tax Escrow			0
Prepaid Expenses & Other Assets			1,022,670
Total Assets			89,199,278
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable			124,407,623
Accounts Payable and Accrued Expenses			701,699
Advance Rental Payments and Security Deposits			2,620,890
Total Liabilities			127,730,212
Partners' Capital			(38,530,934)
Total Liabilities and Capital			89,199,278
Partners' Capital % - NERA				40.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture			$ (15,412,374)
Total units/ condominiums
Total | property	409
Units to be retained | property	409
Dexter Park | Residential buildings
Total units/ condominiums
Total | property						409
Dexter Park | Residential buildings | NERA 40%
Total units/ condominiums
Total | property	409

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Income) (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Oct. 28, 2009	Oct. 03, 2005	Mar. 02, 2005	Sep. 30, 2004	Aug. 31, 2004	Nov. 30, 2001
Revenues
Rental income	$ 6,073,093	$ 5,945,278
Laundry and Sundry Income	40,388	38,711
Total Revenues	6,113,481	5,983,989
Expenses
Administrative	95,095	101,568
Depreciation and amortization	1,466,594	1,428,571
Management Fees	163,616	159,840
Operating	557,415	579,810
Renting	44,657	45,600
Repairs and Maintenance	492,106	675,249
Taxes and Insurance	785,411	710,397
Total Expenses	3,604,894	3,701,035
Income Before Other Income	2,508,587	2,282,954
Other Income (loss)
Interest Expense	(1,731,620)	(1,609,345)
Gain on Sale of Real Estate	433,662	1,644,763
Total Other Income (Loss)	(1,297,958)	35,418
Net Income (Loss)	1,210,629	2,318,372
Proportionate share of net income (loss)	548,939	1,100,900
NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 323,424	$ 867,757
Ownership interest (as a percent)	50.00%	50.00%
NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 225,515	$ 233,143
Ownership interest (as a percent)	40.00%	40.00%
Hamilton Essex 81
Revenues
Rental income	$ 459,573	$ 411,222
Laundry and Sundry Income	3,005	3,005
Total Revenues	462,578	414,227
Expenses
Administrative	5,379	9,680
Depreciation and amortization	119,544	114,285
Management Fees	17,206	13,204
Operating	21,450	24,131
Renting	3,330	3,291
Repairs and Maintenance	37,884	54,501
Taxes and Insurance	61,830	62,527
Total Expenses	266,623	281,619
Income Before Other Income	195,955	132,608
Other Income (loss)
Interest Expense	(121,005)	(99,313)
Total Other Income (Loss)	(121,005)	(99,313)
Net Income (Loss)	74,950	$ 33,295
Ownership interest (as a percent)		50.00%
Hamilton Essex 81 | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 37,475	$ 16,648
Ownership interest (as a percent)	50.00%
Hamilton Essex Development
Revenues
Rental income	$ 75,290	53,928
Total Revenues	75,290	53,928
Expenses
Administrative	2,092	488
Depreciation and amortization	5,074	665
Management Fees	2,160	2,157
Operating	8
Repairs and Maintenance		4,163
Taxes and Insurance	15,677	16,723
Total Expenses	25,011	24,196
Income Before Other Income	50,279	29,732
Other Income (loss)
Net Income (Loss)	50,279	$ 29,732
Ownership interest (as a percent)		50.00%
Hamilton Essex Development | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 25,140	$ 14,866
Ownership interest (as a percent)	50.00%
345 Franklin
Revenues
Rental income	$ 385,243	403,837
Laundry and Sundry Income	1,389	1,217
Total Revenues	386,632	405,054
Expenses
Administrative	5,390	6,455
Depreciation and amortization	86,226	86,251
Management Fees	14,056	16,126
Operating	22,603	20,580
Renting	3,520	497
Repairs and Maintenance	18,467	21,497
Taxes and Insurance	40,241	41,631
Total Expenses	190,503	193,037
Income Before Other Income	196,129	212,017
Other Income (loss)
Interest Expense	(94,247)	(96,961)
Total Other Income (Loss)	(94,247)	(96,961)
Net Income (Loss)	101,882	$ 115,056
Ownership interest (as a percent)		50.00%						50.00%
345 Franklin | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 50,941	$ 57,528
Ownership interest (as a percent)	50.00%
Hamilton 1025
Revenues
Rental income	$ 23,594	38,221
Total Revenues	23,594	38,221
Expenses
Administrative	1,694	1,499
Depreciation and amortization	3,196
Management Fees	965	1,508
Operating	775	156
Repairs and Maintenance	8,040	40,207
Taxes and Insurance	7,349	18,171
Total Expenses	22,019	61,541
Income Before Other Income	1,575	(23,320)
Other Income (loss)
Interest Expense		(26)
Gain on Sale of Real Estate	754	817,006
Total Other Income (Loss)	754	816,980
Net Income (Loss)	2,329	$ 793,660
Ownership interest (as a percent)		50.00%			50.00%
Hamilton 1025 | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 1,165	$ 396,830
Ownership interest (as a percent)	50.00%
Hamilton Bay Apts
Revenues
Rental income	$ 3,629	22,203
Total Revenues	3,629	22,203
Expenses
Administrative	3,445	3,066
Depreciation and amortization	5,420	10,000
Management Fees	145	1,022
Operating	(109)	825
Repairs and Maintenance	10,266	34,224
Taxes and Insurance	4,906	16,459
Total Expenses	24,073	65,596
Income Before Other Income	(20,444)	(43,393)
Other Income (loss)
Interest Expense	(6)	(49)
Gain on Sale of Real Estate	432,908	827,757
Total Other Income (Loss)	432,902	827,708
Net Income (Loss)	412,458	$ 784,315
Ownership interest (as a percent)		50.00%		50.00%
Hamilton Bay Apts | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 206,229	$ 392,158
Ownership interest (as a percent)	50.00%
Hamilton Minuteman
Revenues
Rental income	$ 274,837	263,051
Laundry and Sundry Income	1,907	675
Total Revenues	276,744	263,726
Expenses
Administrative	3,716	1,824
Depreciation and amortization	88,595	87,722
Management Fees	11,067	10,368
Operating	23,755	33,850
Renting	2,032	3,378
Repairs and Maintenance	36,672	19,617
Taxes and Insurance	32,251	31,046
Total Expenses	198,088	187,805
Income Before Other Income	78,656	75,921
Other Income (loss)
Interest Expense	(57,991)	(58,519)
Total Other Income (Loss)	(57,991)	(58,519)
Net Income (Loss)	20,665	$ 17,402
Ownership interest (as a percent)		50.00%				50.00%
Hamilton Minuteman | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ 10,333	$ 8,701
Ownership interest (as a percent)	50.00%
Hamilton on Main Apts
Revenues
Rental income	$ 822,668	858,213
Laundry and Sundry Income	10,062	9,126
Total Revenues	832,730	867,339
Expenses
Administrative	17,847	13,127
Depreciation and amortization	258,438	255,506
Management Fees	31,868	32,443
Operating	107,289	120,393
Renting	16,112	8,652
Repairs and Maintenance	124,192	182,374
Taxes and Insurance	104,431	104,551
Total Expenses	660,177	717,046
Income Before Other Income	172,553	150,293
Other Income (loss)
Interest Expense	(188,268)	(188,239)
Total Other Income (Loss)	(188,268)	(188,239)
Net Income (Loss)	(15,715)	$ (37,946)
Ownership interest (as a percent)		50.00%					50.00%
Hamilton on Main Apts | NERA 50%
Other Income (loss)
Proportionate share of net income (loss)	$ (7,858)	$ (18,973)
Ownership interest (as a percent)	50.00%
Dexter Park
Revenues
Rental income	$ 4,028,259	3,894,603
Laundry and Sundry Income	24,025	24,688
Total Revenues	4,052,284	3,919,291
Expenses
Administrative	55,532	65,429
Depreciation and amortization	900,101	874,142
Management Fees	86,149	83,012
Operating	381,644	379,875
Renting	19,663	29,782
Repairs and Maintenance	256,585	318,666
Taxes and Insurance	518,726	419,289
Total Expenses	2,218,400	2,170,195
Income Before Other Income	1,833,884	1,749,096
Other Income (loss)
Interest Expense	(1,270,103)	(1,166,238)
Total Other Income (Loss)	(1,270,103)	(1,166,238)
Net Income (Loss)	563,781	$ 582,858
Ownership interest (as a percent)		40.00%	40.00%
Dexter Park | NERA 40%
Other Income (loss)
Proportionate share of net income (loss)	$ 225,515	$ 233,143
Ownership interest (as a percent)	40.00%

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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Mortgage Maturities) (Details) - USD ($)	Mar. 31, 2019	Mar. 31, 2018
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Less: unamortized deferred financing costs	$ (1,285,000)
Debt maturities net of unamortized deferred financing costs		$ 123,720,733
Weighted average interest rate (as a percent)	3.87%
Effective interest rate (as a percent)	3.94%
Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
3/31/2019	$ 199,661
3/31/2020	207,527
3/31/2021	215,702
3/31/2022	224,199
3/31/2023	233,032
Thereafter	166,323,670
Total	167,403,791
Less: unamortized deferred financing costs	(932,494)
Debt maturities net of unamortized deferred financing costs	166,471,297
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Thereafter	10,000,000
Total	10,000,000
Less: unamortized deferred financing costs	(89,629)
Debt maturities net of unamortized deferred financing costs	9,910,371	9,896,582
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
3/31/2019	199,661
3/31/2020	207,527
3/31/2021	215,702
3/31/2022	224,199
3/31/2023	233,032
Thereafter	8,423,670
Total	9,503,791
Less: unamortized deferred financing costs	(61,591)
Debt maturities net of unamortized deferred financing costs	9,442,200	9,627,636
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Thereafter	6,000,000
Total	6,000,000
Less: unamortized deferred financing costs	(101,953)
Debt maturities net of unamortized deferred financing costs	5,898,047	5,889,863
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Thereafter	16,900,000
Total	16,900,000
Less: unamortized deferred financing costs	(86,944)
Debt maturities net of unamortized deferred financing costs	16,813,056	16,797,004
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Thereafter	125,000,000
Total	125,000,000
Less: unamortized deferred financing costs	(592,377)
Debt maturities net of unamortized deferred financing costs	$ 124,407,623	$ 81,509,648

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EMPLOYEE BENEFIT 401(k) PLANS (Details)	3 Months Ended
	Mar. 31, 2019 USD ($)
EMPLOYEE BENEFTI 401(k) PLANS
Maximum deferral percentage	90.00%
Matching contribution (as a percent)	50.00%
Percent of compensation	6.00%
Employee contribution vesting percentage	100.00%
Years of service required to vest in employer contributions	2 years
Years of service required to vest 100% in employer contributions	6 years
Annual vesting percentage	20.00%
Total plan expense	$ 12,000

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SUBSEQUENT EVENTS (Details)			1 Months Ended				3 Months Ended	132 Months Ended	139 Months Ended
	Jul. 31, 2014	Aug. 31, 2007 shares	May 31, 2019 USD ($)	May 03, 2019 USD ($) $ / item shares	Apr. 30, 2019 USD ($) shares	Sep. 30, 2007 shares	Mar. 31, 2019 USD ($) shares	Dec. 31, 2018 shares	Mar. 31, 2019 USD ($) $ / item	Mar. 29, 2018 USD ($)
Subsequent events
Number of depository receipts repurchased | shares		1,408				1,408	1,408	1,408
Repurchase price of depository receipts (in dollars per receipt) | $ / item									27.97
Total cost of repurchase							$ 2,930,736		$ 43,205,000
Units required to be repurchased (in shares) | shares							1,795
Loan balance							$ 253,238,000		$ 253,238,000
Webster Green Apartments
Subsequent events
Loan amount										$ 21,500,000
Line of Credit
Subsequent events
Term of debt	3 years
Subsequent event
Subsequent events
Number of depository receipts repurchased | shares				1,540
Repurchase price of depository receipts (in dollars per receipt) | $ / item				64.91
Price per unit of depository receipts | $ / item				1,947.21
Total cost of repurchase				$ 96,861
Subsequent event | Residences at Captain Parkers LLC Residential Apartments Lexington, Massachusetts
Subsequent events
Loan amount			$ 20,750,000
Term of debt			10 years
Interest rate (as a percent)			4.05%
Loan balance			$ 20,071,000
Mortgage prepayment penalties			$ 200,000
Mortgage prepayment penalties (as a percent)			1.00%
Class B
Subsequent events
Number of depository receipts repurchased | shares		3,413				3,413	3,413	3,413
Total cost of repurchase							$ 556,828
Class B | Subsequent event
Subsequent events
Units required to be repurchased (in shares) | shares					12
Value of units required to be repurchased					$ 23,740
General Partnership
Subsequent events
Number of depository receipts repurchased | shares		180				180	180	180
Total cost of repurchase							$ 29,307
Units required to be repurchased (in shares) | shares							18
Value of units required to be repurchased							$ 29,307
General Partnership | Subsequent event
Subsequent events
Units required to be repurchased (in shares) | shares					1
Value of units required to be repurchased					$ 1,249