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 September 30, 2022

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 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 ☒
	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 January 19, 2023, there were 95,404 of the registrant’s Class A units (2,862,128 Depositary Receipts) of limited partnership issued and outstanding and 22,658 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 September 30, 2022 and December 31, 2021	4
	Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2022 and 2021	5
	Consolidated Statements of Changes in Partners’ Capital for the Nine Months Ended September 30, 2022 and 2021	6
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2022 and 2021	7
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	41
Item 4.	Controls and Procedures	42
PART II—OTHER INFORMATION
Item 1.	Legal Proceedings	43
Item 1A.	Risk Factors	43
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	43
Item 3.	Defaults Upon Senior Securities	43
Item 4.	Mine Safety Disclosure	44
Item 5.	Other Information	44
Item 6.	Exhibits	44
SIGNATURES		46

2

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, 2021, 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

Form10-K for the fiscal year ended December 31, 2021.

The results of operations for the three and nine month periods ended September 30, 2022 are not necessarily indicative of the results to be expected for the entire fiscal year or any other period.

3

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	September 30,		December 31,
	2022		2021
ASSETS		(Unaudited)
Rental Properties	$	242,937,926	$	251,355,202
Cash and Cash Equivalents		59,473,939		96,083,508
Rents Receivable		414,659		935,303
Real Estate Tax Escrows		1,907,378		861,697
Investment in U.S. Treasury Bills		73,995,586		—
Prepaid Expenses and Other Assets		7,613,638		6,183,981
Investments in Unconsolidated Joint Ventures		1,439,150		1,455,888
Total Assets	$	387,782,276	$	356,875,579
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable		411,475,632		370,481,390
Distribution and Loss in Excess of Investment in Unconsolidated Joint Venture		24,136,809		22,992,420
Accounts Payable and Accrued Expenses		4,298,250		4,324,879
Advance Rental Payments and Security Deposits		8,874,364		8,369,497
Total Liabilities		448,785,055		406,168,186
Commitments and Contingent Liabilities (Notes 3 and 9)		—		—
Partners’ Capital 119,324 and 121,516 units outstanding in 2022 and 2021 respectively		(61,002,779)		(49,292,607)
Total Liabilities and Partners’ Capital	$	387,782,276	$	356,875,579

See notes to consolidated financial statements.

4

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended					Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Revenues
Rental income	$	16,974,515	$	15,832,492	$	50,260,258	$	46,145,825
Laundry and sundry income		103,868		114,180		330,461		336,980
		17,078,383		15,946,672		50,590,719		46,482,805
Expenses
Administrative		696,656		607,478		2,028,319		1,819,481
Depreciation and amortization		4,114,913		3,956,979		12,212,278		11,806,561
Management fee		683,999		646,059		2,029,453		1,867,798
Operating		1,410,843		1,338,718		5,609,302		4,792,332
Renting		181,574		458,040		501,906		941,281
Repairs and maintenance		3,126,953		3,128,369		8,381,339		7,432,860
Taxes and insurance		2,302,648		2,259,793		6,879,455		6,688,885
		12,517,586		12,395,436		37,642,052		35,349,198
Income Before Other Income (Expense)		4,560,797		3,551,236		12,948,667		11,133,607
Other Income (Expense)
Interest income		363,350		27		363,411		74
Interest expense		(3,982,445)		(3,393,518)		(11,060,794)		(10,136,630)
Income (loss) from investments in unconsolidated joint ventures		93,516		(233,130)		203,867		(796,725)
Other (expenses)		(39,994)		—		(874,526)		—
		(3,565,573)		(3,626,621)		(11,368,042)		(10,933,281)
Net Income	$	995,224	$	(75,385)	$	1,580,625	$	200,326
Net Income per Unit	$	8.32	$	(0.62)	$	13.12	$	1.65
Weighted Average Number of Units Outstanding		119,638		121,756		120,465		121,756

See notes to consolidated financial statements.

5

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNER’S CAPITAL

(Unaudited)

	Units						Partner’s Capital
	Limited		General		Treasury		Limited				General
	Class A	Class B	Partnership	Subtotal	Units	Total	Class A		Class B		Partnership		Total
Balance January 1, 2021	144,180	34,243	1,802	180,225	58,469	121,756	$	(33,203,447)		(7,852,318)		(413,280)	$	(41,469,045)
Distribution to Partners	—	—	—	—	—	—		(2,805,265)		(666,251)		(35,065)		(3,506,581)
Net Income	—	—	—	—	—	—		160,261		38,062		2,003		200,326
Balance September 30 , 2021	144,180	34,243	1,802	180,225	58,469	121,756	$	(35,848,451)	$	(8,480,507)	$	(446,342)	$	(44,775,300)
Balance January 1, 2022	144,180	34,243	1,802	180,225	58,709	121,516	$	(39,462,357)	$	(9,338,738)	$	(491,512)	$	(49,292,607)
Distribution to Partners	—	—	—	—	—	—		(6,498,504)		(1,543,395)		(81,231)		(8,123,130)
Stock Buyback	—	—	—	—	2,192	(2,192)		(4,134,773)		(981,249)		(51,645)		(5,167,667)
Net Income	—	—	—	—	—	—		1,264,500		300,319		15,806		1,580,625
Balance September 30, 2022	144,180	34,243	1,802	180,225	60,901	119,324	$	(48,831,134)	$	(11,563,063)	$	(608,582)	$	(61,002,779)

See notes to consolidated financial statements.

6

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended September 30,
	2022		2021
Cash Flows from Operating Activities
Net Income	$	1,580,625	$	200,326
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		12,212,278		11,806,561
Amortization of deferred finance costs		350,115		179,879
(Income) Loss from investments in joint ventures		(203,867)		796,725
Allowance for doubtful accounts		—		906,986
Change in operating assets and liabilities
Proceeds from unconsolidated joint ventures		72,500		27,250
Decrease (Increase) in rents receivable		520,644		(498,584)
(Decrease) Increase in accounts payable and accrued expense		(26,636)		413,183
(Increase) in real estate tax escrow		(1,045,681)		(32,970)
(Increase) in prepaid expenses and other assets		(931,325)		(1,195,693)
Increase in advance rental payments and security deposits		504,867		244,888
Total Adjustments		11,452,895		12,648,225
Net cash provided by operating activities		13,033,520		12,848,551
Cash Flows From Investing Activities
Distribution in excess of investment in unconsolidated joint ventures		1,135,000		603,202
(Investment) in unconsolidated joint ventures		—		(40,702)
Investment in U.S. Treasury Bills		(103,995,587)		—
Proceeds from U.S.Treasury Bills		30,000,000		—
Improvement of rental properties		(3,708,707)		(2,230,442)
Net cash (used in) investing activities		(76,569,294)		(1,667,942)
Cash Flows from Financing Activities
Principal payments of mortgage notes payable		(1,720,335)		(1,704,743)
Proceeds from Mortgage Notes Payable		41,937,337		—
Stock buyback		(5,167,667)		—
Distributions to partners		(8,123,130)		(3,506,581)
Net cash provided by (used in) financing activities		26,926,205		(5,211,324)
Net (Decrease) Increase in Cash and Cash Equivalents		(36,609,569)		5,969,285
Cash and Cash Equivalents, at beginning of period		96,083,508		18,646,972
Cash and Cash Equivalents, at end of period	$	59,473,939	$	24,616,257

See notes to consolidated financial statements.

7

NEW ENGLAND REALTY ASSOCIATES LIMITED PARTNERSHIP AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022

(Unaudited)

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

Line of Business: New England Realty Associates Limited Partnership (“NERA”, the “Company” or the “Partnership”) was organized in Massachusetts in 1977. NERA and its subsidiaries own 29 properties which include 21 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,892 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a 40 - 50% interest in 7 residential and mixed use properties consisting of 688 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 seven 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

8

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. Revenue from commercial leases also include reimbursements and recoveries 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 amounts are accounted for 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.

The Partnership evaluates the non-lease components (lease arrangements that include common area maintenance services) with related lease components (lease revenues). If both the timing and pattern of transfer are the same for the non-lease component and related lease component, the lease component is the predominant component. The Partnership elected an allowed practical expedient. For (i) operating lease arrangements involving real estate that include common area maintenance services and (ii) all real estate arrangements that include real estate taxes and insurance costs, we present these amounts within lease revenues in our consolidated statements of income. We record amounts reimbursed by the lessee in the period in which the applicable expenses are incurred.

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

9

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 $350,000 and $180,000 for the nine months ended September 30, 2022 and 2021, 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 at the time of purchase.

Investments in Treasury Bills: Investments in Treasury Bills are recorded at amortized cost and classified as held to maturity as the Partnership has the intent and the ability to hold them until they mature. The carrying value of the Treasury Bills are adjusted for accretion of discounts over the remaining life of the investment. Income related to the Treasury Bills is recognized in interest income in the Partnership’s consolidated statement of income.

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 2022 or 2021 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.

10

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 2022 or 2021. The Partnership makes its temporary cash investments with high-credit quality financial institutions. At September 30, 2022, substantially all of the Partnership’s cash and cash equivalents were held in interest-bearing accounts at financial institutions, and investments in U.S. Treasury bills, earning interest at rates from 0.01% to 2.19%. At September 30, 2022 and December 31, 2021, respectively approximately $45,045,000, and $96,166,000 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 $190,316 and $240,814 for the nine months ended September 30, 2022, and 2021, respectively.

Rental Property Held 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.

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 nine months ended September 30, 2022, and 2021 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 refinancings qualify as extinguishment of debt.

Reclassification: Certain reclassifications have been made to prior period amounts in order to conform to current period presentation.

NOTE 2. RENTAL PROPERTIES

As of September 30, 2022, the Partnership and its Subsidiary Partnerships owned 2,892 residential apartment units in 25 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 September 30, 2022, 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 seven residential and mixed use complexes (the “Investment Properties”) at September 30, 2022 with a total of 688 apartment units, accounted for using the equity method of consolidation. See Note 14 for summary information on these investments.

11

Rental properties consist of the following:

	September 30, 2022		December 31, 2021		Useful Life
Land, improvements and parking lots	$	87,506,136	$	86,887,276	15	-	40	years
Buildings and improvements		254,618,756		253,952,680	15	-	40	years
Kitchen cabinets		17,384,297		16,946,916	5	-	10	years
Carpets		12,751,418		12,029,577	5	-	10	years
Air conditioning		501,697		501,697	5	-	10	years
Laundry equipment		613,961		608,271	5	-	7	years
Elevators		1,885,265		1,885,265	20	-	40	years
Swimming pools		1,090,604		1,090,604	10	-	30	years
Equipment		18,767,307		18,072,761	5	-	30	years
Motor vehicles		171,519		171,519			5	years
Fences		46,872		46,872	5	-	15	years
Furniture and fixtures		8,462,476		7,898,163	5	-	7	years
Smoke alarms		496,641		496,641	5	-	7	years
Total fixed assets		404,296,949		400,588,242
Less: Accumulated depreciation		(161,359,023)		(149,233,040)
	$	242,937,926	$	251,355,202

NOTE 3. RELATED PARTY TRANSACTIONS

The Partnership’s properties are managed by The Hamilton Company, Inc. (the “Management Company”) an entity that is owned by the majority shareholder of NewReal, Inc., the general partner of the Partnership (the “General Partner”). The management fee is equal to 4% of gross receipts of rental revenue and laundry income on the majority of the Partnership’s properties and 3% on Linewt. Total fees paid were approximately $2,029,000 and $1,868,000 for the nine months ended September 30, 2022 and 2021, respectively.

The Partnership Agreement permits the General Partner or the Management Company to charge the costs of professional services (such as counsel, accountants and contractors) to NERA. During the nine months ended September 30, 2022 and 2021, approximately $583,000 and $766,000 was charged to NERA for legal, accounting, construction, maintenance, brokerage fees, rental and architectural services and supervision of capital improvements. Of the 2022 expenses referred to above, approximately $215,000 consisted of repairs and maintenance, $256,000 of administrative expense, and approximately $23,000 for renting expense. Approximately $89,000 of expenses for construction, architectural services and supervision of capital projects were capitalized in rental properties. Additionally in 2022, the Hamilton Company received approximately $567,000 from the Investment Properties of which approximately $491,000 was the management fee, approximately $38,000 was for maintenance services, approximately $14,000 was for administrative services and approximately $24,000 for construction, 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 $2,945,000 and $2,759,000 for the nine months ended September 30, 2022 and 2021, 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. For the nine months ended September 30, 2022, the Partnership accrued $70,000 for the employer’s match portion to the plan. For the nine months ended September 30, 2021, the Partnership contributed $33,000 for the employer’s match portion to the plan.

Bookkeeping and accounting functions are provided by the Management Company’s accounting staff, which consists of approximately 14 people. During the nine months ended September 30, 2022 and 2021, the Management Company charged the Partnership $93,750 ($125,000 per year) for bookkeeping and accounting services included in administrative expenses above.

Sally Michael is a Director of New Real, Inc., and she is a Partner at Saul Ewing Arnstein & Lear LLP. Saul Ewing billed the Partnership for legal fees totaling approximately $68,000 and $8,000 for the nine months ended September 30, 2022 and 2021 respectively.

12

The Partnership has invested in seven 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 Brown family related entities, and five current and previous employees of the Management Company. The Brown Family related entities’ ownership interest was between 47.6% and 59%. See Note 14 for a description of the properties and their operations.

NOTE 4. PREPAID EXPENSES and OTHER ASSETS

Approximately $3,402,000, and $3,067,000 of security deposits are included in prepaid expenses and other assets at September 30, 2022 and December 31, 2021, respectively. The security deposits and escrow accounts are restricted cash.

Also, included in prepaid expenses and other assets at September 30, 2022 and December 31, 2021 is approximately $1,849,000 and $1,819,000, respectively, held in escrow to fund future capital improvements.

Intangible assets on the acquisition of Mill Street Apartments are included in prepaid expenses and other assets. Intangible assets are approximately $7,000 net of accumulated amortization of approximately $1,411,000 and approximately $26,000 net of accumulated amortization of approximately $1,392,000 at September 30, 2022 and December 31, 2021, respectively.

Financing fees in association with the line of credit of approximately $124,000 and $169,000 are net of accumulated amortization of approximately $55,000 and $10,000 at September 30, 2022 and December 31, 2021 respectively.

NOTE 5. MORTGAGE NOTES PAYABLE

At September 30, 2022 and December 31, 2021, the mortgages payable consisted of various loans, all of which were secured by first mortgages on properties referred to in Note 2. At September 30, 2022, the interest rates on these loans ranged from 2.97% to 4.95%, payable in monthly installments aggregating approximately $1,471,000 including principal, to various dates through 2035. The majority of the mortgages are subject to prepayment penalties. At September 30, 2022, the weighted average interest rate on the above mortgages was 3.69%. The effective rate of 3.80% 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 $3,213,000 and $2,709,000 are net of accumulated amortization of approximately $948,000 and $1,139,000 at September 30, 2022 and December 31, 2021, respectively, which offset the total mortgage notes payable.

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

Approximate annual maturities at September 30, 2022 are as follows:

2023—current maturities	$	8,583,000
2024		2,749,000
2025		3,260,000
2026		25,209,000
2027		3,121,000
Thereafter		371,767,000
		414,689,000
Less: unamortized deferred financing costs		(3,213,000)
	$	411,476,000

On November 30, 2021, the Partnership entered into a Master Credit Facility Agreement (the “Facility Agreement”) with KeyBank National Association (“KeyBank”) dated as of November 30, 2021, with an initial advance

13

in the amount of $156,000,000. Interest only on the debt at a fixed interest rate of 2.97% is payable on a monthly basis through December 31, 2031.

On June 16, 2022, the Partnership entered into an amendment to the Facility Agreement. The additional advance under the Amended Agreement is in the amount of $80,284,000, at a fixed interest rate of 4.33%. The Partnership’s obligations under the Facility Agreement are secured by mortgages on certain properties pursuant to certain Mortgage, Assignment of Leases and Rents, and Security Agreement and Fixture Filings.

The Partnership used the proceeds to pay down approximately $37,065,000 of existing debt secured by four properties, along with approximately $854,000 in prepayment penalties. The remaining balance of approximately $42,384,000 will be used for general partnership purposes.

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. Prior to the line’s expiration in 2020, the Partnership exercised its option for a one-year extension until October 31, 2021. The Partnership paid an extension fee of approximately $37,500 in association with the extension.

On October 29, 2021, the Partnership closed on the modification of its existing line of credit. The agreement extends the credit line for three years until October 29, 2024. The commitment amount is for $25 million but is restricted to $17 million during the modification period. The modification period covers the current period and phases out by December 31, 2022. During this period, the loan covenants are modified from a minimum consolidated debt service ratio of 1.60 to a ratio of 1.35 until September 30, 2022; from a minimum tangible net worth requirement of $200 million to a net worth of $175 million until September 30, 2022; from a maximum consolidated leverage ratio of 65% to a ratio of 70% until September 30, 2022 and from a minimum debt yield of 9.5% to a yield of 8.5% until September 30, 2022 and a yield of 9.0% until December 31, 2022. Once the financial performance of the Partnership meets the original covenant tests for the trailing 12-month period, the commitment amount will return to $25 million. The portfolio’s debt yield fell below the minimum of 8.5% to 8.05%. As of September 30, 2022, the Partnership did not comply with the debt yield financial covenant. As such, the Partnership is unable to draw down any amount from the line of credit until the Partnership meets the required financial covenants.

The interest rate for the new term is LIBOR plus 300 basis points. The costs associated with the modification and renewal of the line of credit was approximately $179,000. On December 3, 2021, the Partnership paid off the outstanding balance of $17,000,000 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 dividends, make distributions or acquire equity interests of the Partnership.

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

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 September 30, 2022, amounts received for prepaid rents of approximately $2,581,000 are included in cash and cash equivalents, and security deposits of approximately $3,402,000 are included in prepaid expenses and other assets and are restricted cash.

14

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 distributions made to the total units outstanding. All classes have equal profit sharing and distribution rights, in proportion to their ownership interests.

In January 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on March 31, 2022. In addition to the quarterly distribution, there was a special distribution of $38.40 per Class A unit ($1.28 per Receipt) payable on March 31, 2022. In April 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on June 30, 2022. In July 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on September 30, 2022.

In 2021, regular quarterly distributions of $9.60 per unit ($0.32 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:

	Nine Months Ended
	September 30,
	2022		2021
Net Income per Depositary Receipt	$	0.44	$	0.05
Distributions per Depositary Receipt	$	2.24	$	0.96

NOTE 8. TREASURY UNITS

Treasury Units at September 30, 2022 are as follows:

Class A	48,721
Class B	11,571
General Partnership	609
	60,901

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. On March 9, 2020, the General Partner extended the program for an additional five years from March 31, 2020 to March 31, 2025. 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 Restated 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 September 30, 2022, the Partnership has repurchased 1,486,802 Depositary Receipts at an average price of $30.09 per receipt (or $902.70 per underlying Class A Unit), 4,034 Class B Units and 212 General Partnership Units, both at an average price of $1,179.00 per Unit, totaling approximately $50,336,000 including brokerage fees paid by the Partnership.

During the nine months ended September 30, 2022, the Partnership purchased a total of 52,613 Depositary Receipts. The average price was $78.53 per receipt or $2,355.90 per unit. The cost including commission was $4,134,773.The Partnership was required to repurchase 416.52 Class B Units and 21.92 General Partnership units at a cost of $981,249 and $51,645 respectively.

15

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.

NOTE 10. RENTAL INCOME

During the nine months ended September 30, 2022, approximately 95% 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 5% was related to commercial properties, which have minimum future annual rental income on non-cancellable operating leases at September 30, 2022 as follows:

	Commercial
	Property Leases
2023	$	1,981,000
2024		1,409,000
2025		871,000
2026		728,000
2027		406,000
Thereafter		1,683,000
	$	7,078,000

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 $441,000 and $417,000 for the nine months ended September 30, 2022 and 2021 respectively. Staples and Trader Joe’s, tenants at Staples Plaza, are approximately 28% 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 September 30,	expiring leases		for expiring leases	leases expiring	expiring leases
2023	$	430,143	55,286	22	19	%
2024		785,710	26,248	13	37	%
2025		135,210	2,461	4	6	%
2026		198,266	5,396	4	9	%
2027		269,210	11,716	5	12	%
2028		93,873	2,158	1	4	%
2029		181,324	5,104	2	8	%
2030		—	—	—	—	%
2031		—	—	—	—	%
Thereafter		118,245	—	1	5	%
Totals	$	2,211,981	108,369	52	100	%

Rents receivable are net of an allowance for doubtful accounts of approximately $824,000 and $832,000 at September 30, 2022 and December 31, 2021. Included in rents receivable at September 30, 2022 is approximately $76,000 resulting from recognizing rental income from non-cancelable commercial leases with future rental increases on a straight-line basis.

Rents receivable at September 30, 2022 also includes approximately $13,000 representing the deferral of rental concession primarily related to the residential properties.

16

NOTE 11. CASH FLOW INFORMATION

During the nine months ended September 30, 2022 and 2021, cash paid for interest was approximately $10,584,000, and $9,985,000 respectively. Cash paid for state income taxes was approximately $52,000 and $70,000 during the nine months ended September 30, 2022 and 2021 respectively. During the nine months ended September 30, 2022, four properties were involved in a non-cash financing activity of approximately $37,000,000.

NOTE 12. FAIR VALUE MEASUREMENTS

Fair Value Measurements on a Recurring Basis

At September 30, 2022 and December 31, 2021, 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 September 30, 2022 and December 31, 2021 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. The Company considers all highly liquid investments purchased with original maturities of three months or less at the time of purchase to be cash equivalents. Cash, cash equivalents, and restricted cash include cash held in checking, U.S. Treasury Bills, and money market accounts.

The Partnership has investments in Treasury Bills some of which mature over a period greater than 90 days and are classified as short-term investments. The Treasury Bills are carried at amortized cost and classified as held to maturity as the Partnership has the intent and the ability to hold them until they mature. The carrying value of the Treasury Bills are adjusted for accretion of discounts over the remaining life of the investment. Income related to the Treasury Bills is recognized in interest income in the Partnership’s consolidated statement of income. The Treasury Bills classified within Level I of the fair value hierarchy.

At September 30, 2022 and December 31, 2021 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 September 30, 2022 and December 31, 2021, 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.

17

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

		September 30, 2022				December 31, 2021
		Carrying Value		Fair Value		Carrying Value		Fair Value
Assets
Cash equivalents		$	59,473,939	$	59,529,805	$	96,083,508	$	96,083,508
Treasury bills		$	73,995,586	$	74,158,935	$	—	$	—
Total Assets		$	133,469,525	$	133,688,740	$	96,083,508	$	96,083,508
Liabilities
Mortgage payable
- Partnership properties	*	$	411,475,632	$	366,891,771	$	370,481,390	$	383,244,134
- Investment properties	*	$	166,119,958	$	155,922,343	$	166,203,705	$	175,881,762
Total Liabilities		$	577,595,590	$	522,814,114	$	536,685,095	$	559,125,896

* Net of unamortized deferred financing costs

Disclosure about fair value of financial instruments is based on pertinent information available to management as of September 30, 2022 and December 31, 2021. 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 September 30, 2022 and current estimates of fair value may differ significantly from the amounts presented herein.

NOTE 13. TAXABLE INCOME AND TAX BASIS

Taxable income reportable by the Partnership and includable in its partners’ tax returns is different than financial statement income because of tax free exchanges, different depreciation methods, different tax lives, other items with limited tax deductibility carryovers and timing differences related to prepaid rents, allowances and intangible assets at significant acquisitions. Federal taxable income of approximately $4,056,000 was approximately $6,756,000 more than statement income for the year ended December 31, 2021. The Federal cumulative tax basis of the Partnership’s real estate at December 31, 2021 is approximately $10,946,000 more 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 Federal tax basis in its joint venture investments is approximately $1,066,000 more than statement basis. State taxable income may be significantly different due to different tax treatments for certain items.

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 consolidated financial statements.

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 September 30, 2022, the tax years that generally remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2018 forward.

18

NOTE 14. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

The Partnership has invested in seven limited partnerships and limited liability companies, the majority of which have invested in residential apartment complexes, with three Joint Ventures investing in commercial property. The Partnership has between a 40%-50% ownership interests in each investment. The other investors are the Brown Family related entities and five current and former employees of the Management Company. The Brown Family’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 was to mature 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 , 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 are 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. At September 30, 2022, the balance on this mortgage before unamortized deferred financing costs is $125,000,000. This investment, Hamilton Park Towers, LLC is referred to as Dexter Park.

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 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. At September 30, 2022, the balance on this mortgage before unamortized deferred financing costs is $10,000,000. 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.

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. After paying off the mortgage, the Partnership began to

19

sell off the individual units. In 2019, all residential units were sold. The Partnership still owns the commercial building. 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. 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. 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. At September 30, 2022, the balance on this mortgage before unamortized deferred financing costs is $6,000,000. This investment is referred to as Hamilton Minuteman, LLC.

In August 2004, the Partnership invested $8,000,000 for a 50% ownership interest in a 280-unit apartment complex located in Watertown, Massachusetts. The total purchase price was $56,000,000. The Joint Venture sold 137 units as condominiums. The assets were combined with Hamilton on Main Apartments. Hamilton on Main, LLC is known as Hamilton Place. In 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. 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. At September 30, 2022, the balance of the mortgage before unamortized deferred finance is $16,900,000. The investment is referred to as Hamilton on Main LLC.

In November 2001, the Partnership invested approximately $1,533,000 for a 50% ownership interest in a 40-unit apartment building in Cambridge, Massachusetts. In June 2013, the property was refinanced with a 15 year mortgage in the amount of $10,000,000 at 3.87%, interest only for 3 years and is amortized on a 30-year schedule for the balance of the term. The Joint Venture paid off the prior mortgage of approximately $6,776,000 with the proceeds of the new mortgage. After the refinancing, the Joint Venture made a distribution of $1,610,000 to the Partnership. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. At September 30, 2022, the balance of this mortgage before unamortized deferred financing costs is approximately $8,770,000. This investment is referred to as 345 Franklin, LLC.

Summary financial information at September 30, 2022

				Hamilton									Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	5,935,095		$	2,586,302		$	4,852,841		$	79,107		$	4,551,023		$	13,688,356		$	76,657,705		$	108,350,429
Cash & Cash Equivalents		883,219			88,190			265,808			9,882			175,451			910,242			2,220,183			4,552,975
Rent Receivable		198,014			77,561			1,240			4,906			5,299			18,832			44,830			350,682
Real Estate Tax Escrow		74,625			—			69,748			—			32,497			105,494			—			282,364
Prepaid Expenses & Other Assets		321,917			56,261			117,224			757			28,665			224,845			2,298,375			3,048,044
Total Assets	$	7,412,870		$	2,808,314		$	5,306,861		$	94,652		$	4,792,935		$	14,947,769		$	81,221,093		$	116,584,494
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,958,633		$	—		$	8,731,598		$	—		$	5,926,689		$	16,869,235		$	124,633,803		$	166,119,958
Accounts Payable & Accrued Expense		120,784			2,250			92,492			2,553			59,237			163,200			756,960			1,197,476
Advance Rental Pmts & Security Deposits		332,572			19,865			280,818			—			161,741			430,923			2,837,995			4,063,914
Total Liabilities		10,411,989			22,115			9,104,908			2,553			6,147,667			17,463,358			128,228,758			171,381,348
Partners’ Capital		(2,999,119)			2,786,199			(3,798,047)			92,099			(1,354,732)			(2,515,589)			(47,007,665)			(54,796,854)
Total Liabilities and Capital	$	7,412,870		$	2,808,314		$	5,306,861		$	94,652		$	4,792,935		$	14,947,769		$	81,221,093		$	116,584,494
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,393,100		$	—		$	46,050		$	—		$	—		$	—			1,439,150
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,499,560)		$	—		$	(1,899,023)		$	—		$	(677,366)		$	(1,257,794)		$	(18,803,066)			(24,136,809)
Total Investment in Unconsolidated Joint Ventures (Net)																						$	(22,697,659)
Total units/condominiums
Apartments		48			—			40			175			42			148			409			687
Commercial		1			1			—			1			—			—			—			3
Total		49			1			40			176			42			148			409			690
Units to be retained		49			1			40			1			42			148			409			690
Units to be sold		—			—			—			—			—			—			—			—
Units sold through November 1, 2022		—			—			—			175			—			—			—			175
Unsold units		—			—			—			—			—			—			—			—

20

Financial information for the nine months ended September 30, 2022

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,194,570	$	235,842	$	1,107,677	$	77,935	$	899,186	$	2,725,431	$	11,014,528	$	17,255,169
Laundry and Sundry Income		9,839		—		120		—		472		25,402		73,452		109,285
		1,204,409		235,842		1,107,797		77,935		899,658		2,750,833		11,087,980		17,364,454
Expenses
Administrative		14,512		5,798		26,052		2,142		9,297		52,028		163,891		273,720
Depreciation and Amortization		358,568		8,782		259,967		2,448		253,369		808,116		2,813,436		4,504,686
Management Fees		58,716		9,879		43,719		3,166		35,967		108,615		230,937		490,999
Operating		169,086		—		54,901		1,219		95,538		282,757		853,728		1,457,229
Renting		23,823		—		27,857		—		8,988		39,844		85,229		185,741
Repairs and Maintenance		132,026		3,180		125,323		—		82,989		494,223		1,393,350		2,231,091
Taxes and Insurance		199,415		47,074		131,736		13,567		114,224		387,242		1,862,717		2,755,975
		956,146		74,713		669,555		22,542		600,372		2,172,825		7,403,288		11,899,441
Income Before Other Income		248,263		161,129		438,242		55,393		299,286		578,008		3,684,692		5,465,013
Other Income (Loss)
Interest Expense		(257,574)		—		(263,093)		—		(177,129)		(568,251)		(3,817,865)		(5,083,912)
		(257,574)		—		(263,093)		—		(177,129)		(568,251)		(3,817,865)		(5,083,912)
Net (Loss) Income	$	(9,311)	$	161,129	$	175,149	$	55,393	$	122,157	$	9,757	$	(133,173)	$	381,101
Net (Loss) Income —NERA 50%	$	(4,656)	$	80,565	$	87,575	$	27,697	$	61,078	$	4,879				257,136
Net Income —NERA 40%													$	(53,269)		(53,269)
															$	203,867

Financial information for the three months ended September 30, 2022

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	433,819	$	60,471	$	392,851	$	27,813	$	300,345	$	919,313	$	3,894,398	$	6,029,010
Laundry and Sundry Income		4,445		—		—		—		—		8,252		23,860		36,557
		438,264		60,471		392,851		27,813		300,345		927,565		3,918,258		6,065,567
Expenses
Administrative		5,640		4,250		6,060		793		3,542		16,448		54,159		90,892
Depreciation and Amortization		119,789		2,927		86,776		816		84,966		270,802		947,553		1,513,629
Management Fees		21,620		2,353		15,610		1,112		12,438		36,098		78,267		167,498
Operating		49,866		—		18,186		54		20,336		90,931		271,977		451,350
Renting		9,759		—		10,650		—		1,974		14,264		12,555		49,202
Repairs and Maintenance		62,158		—		41,565		—		37,999		188,269		595,679		925,670
Taxes and Insurance		66,313		15,566		44,269		4,448		38,546		125,879		642,107		937,128
		335,145		25,096		223,116		7,223		199,801		742,691		2,602,297		4,135,369
Income Before Other Income		103,119		35,375		169,735		20,590		100,544		184,874		1,315,961		1,930,198
Other Income (Loss)
Interest Expense		(116,185)		—		(86,694)		—		(59,000)		(191,453)		(1,283,295)		(1,736,627)
		(116,185)		—		(86,694)		—		(59,000)		(191,453)		(1,283,295)		(1,736,627)
Net Income (Loss)	$	(13,066)	$	35,375	$	83,041	$	20,590	$	41,544	$	(6,579)	$	32,666	$	193,571
Net Income (Loss)—NERA 50%	$	(6,534)	$	17,688	$	41,520	$	10,295	$	20,771	$	(3,289)				80,451
Net Income —NERA 40%													$	13,065		13,065
															$	93,516

21

Future annual mortgage maturities at September 30, 2022 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
9/30/2023	$	—	$	228,573	$	—	$	—	$	—	$	228,573
9/30/2024		—		237,577		—		16,900,000		—		17,137,577
9/30/2025		10,000,000		246,936		—		—		—		10,246,936
9/30/2026		—		256,664		—		—		—		256,664
9/30/2027		—		266,775		—		—		—		266,775
Thereafter		—		7,533,358		6,000,000		—		125,000,000		138,533,358
		10,000,000		8,769,883		6,000,000		16,900,000		125,000,000		166,669,883
Less: unamortized deferred financing costs		(41,367)		(38,286)		(73,311)		(30,765)		(366,196)		(549,925)
	$	9,958,633	$	8,731,597	$	5,926,689	$	16,869,235	$	124,633,804	$	166,119,958

At September 30, 2022 the weighted average interest rate on the above mortgages was 4.05%. The effective rate was 4.12% including the amortization expense of deferred financing costs.

22

Summary financial information at September 30, 2021

				Hamilton									Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	6,376,891		$	2,588,792		$	5,139,866		$	82,371		$	4,766,334		$	14,522,033		$	79,175,187		$	112,651,474
Cash & Cash Equivalents		230,394			73,049			154,633			9,776			231,357			602,344			2,135,096			3,436,649
Rent Receivable		65,313			13,744			23,113			7,081			7,285			38,832			236,721			392,089
Real Estate Tax Escrow		77,685			—			62,506			—			40,025			117,318			—			297,534
Prepaid Expenses & Other Assets		311,513			67,410			123,115			685			30,592			195,099			1,956,585			2,684,999
Total Assets	$	7,061,796		$	2,742,995		$	5,503,233		$	99,913		$	5,075,593		$	15,475,626		$	83,503,589		$	119,462,745
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,944,844		$	—		$	8,944,849		$	—		$	5,918,506		$	16,853,184		$	124,569,180		$	166,230,563
Accounts Payable & Accrued Expense		82,137			2,250			99,583			2,711			67,629			169,515			804,862			1,228,687
Advance Rental Pmts& Security Deposits		189,746			—			247,951			—			154,400			474,463			2,427,394			3,493,954
Total Liabilities		10,216,727			2,250			9,292,383			2,711			6,140,535			17,497,162			127,801,436			170,953,204
Partners’ Capital		(3,154,931)			2,740,745			(3,789,150)			97,202			(1,064,942)			(2,021,536)			(44,297,847)			(51,490,459)
Total Liabilities and Capital	$	7,061,796		$	2,742,995		$	5,503,233		$	99,913			5,075,593		$	15,475,626		$	83,503,589		$	119,462,745
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,370,373		$	—		$	48,601		$			$			$			$	1,418,974
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,577,467)		$	—		$	(1,894,576)		$	—		$	(532,472)		$	(1,010,769)		$	(17,719,140)			(22,734,423)
Total Investment in Unconsolidated Joint Ventures (Net)																						$	(21,315,449)
Total units/condominiums
Apartments		48			—			40			175			42			148			409			862
Commercial		1			1			—			1			—			—			—			3
Total		49			1			40			176			42			148			409			865
Units to be retained		49			1			40			1			42			148			409			690
Units sold through November 1, 2021		—			—			—			175			—			—			—			175
Unsold units		—			—			—			—			—			—			—			—

23

Financial information for the nine months ended September 30, 2021

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	856,569	$	168,431	$	1,019,465	$	75,148	$	865,196	$	2,491,414	$	9,513,069	$	14,989,292
Laundry and Sundry Income		9,194		—		112		—		4,548		27,837		73,067		114,758
		865,763		168,431		1,019,577		75,148		869,744		2,519,251		9,586,136		15,104,050
Expenses
Administrative		70,445		2,103		22,651		2,140		11,485		49,372		160,336		318,532
Depreciation and Amortization		358,788		15,223		257,314		2,448		253,180		813,435		2,795,700		4,496,088
Management Fees		29,181		6,187		40,288		2,843		34,592		97,262		202,975		413,328
Operating		129,400		—		42,137		231		78,038		315,638		761,854		1,327,298
Renting		81,149		—		46,108		—		1,095		71,772		415,221		615,345
Repairs and Maintenance		123,467		520		100,182		—		86,566		446,677		1,506,426		2,263,838
Taxes and Insurance		195,974		45,037		131,574		14,535		107,198		336,333		1,812,549		2,643,200
		988,404		69,070		640,254		22,197		572,154		2,130,489		7,655,061		12,077,629
Income Before Other Income		(122,641)		99,361		379,323		52,951		297,590		388,762		1,931,075		3,026,421
Other Income (Loss)
Interest Expense		(184,542)		—		(269,993)		—		(177,757)		(568,246)		(3,792,615)		(4,993,153)
Other (Loss)
Other Income		—		—		—				—		—		1,222		1,222
		(184,542)		—		(269,993)		—		(177,757)		(568,246)		(3,791,393)		(4,991,931)
Net Income (Loss)	$	(307,183)	$	99,361	$	109,330	$	52,951	$	119,833	$	(179,484)	$	(1,860,318)	$	(1,965,510)
Net Income (Loss)—NERA 50%	$	(153,593)	$	49,681	$	54,665	$	26,476	$	59,917	$	(89,742)				(52,597)
Net Income —NERA 40%													$	(744,128)		(744,128)
															$	(796,725)

24

Financial information for the three months ended September 30, 2021

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	414,497	$	111,191	$	343,674	$	26,410	$	293,988	$	827,140	$	3,300,261	$	5,317,161
Laundry and Sundry Income		2,986		—		—		—		1,243		9,796		23,706		37,731
		417,483		111,191		343,674		26,410		295,231		836,936		3,323,967		5,354,892
Expenses
Administrative		16,576		750		7,129		651		3,824		14,592		65,606		109,128
Depreciation and Amortization		120,266		5,074		86,449		816		84,827		272,874		938,058		1,508,364
Management Fees		17,335		6,187		13,943		1,272		11,716		32,831		73,512		156,796
Operating		60,232		—		16,060		55		23,542		101,948		260,794		462,631
Renting		26,272		—		12,174		—		375		20,213		222,664		281,698
Repairs and Maintenance		41,335		—		35,687		—		30,184		177,652		599,156		884,014
Taxes and Insurance		64,799		15,228		44,194		4,634		36,986		115,028		614,622		895,491
		346,815		27,239		215,636		7,428		191,454		735,138		2,774,412		4,298,122
Income Before Other Income		70,668		83,952		128,038		18,982		103,777		101,798		549,555		1,056,770
Other Income (Loss)
Interest Expense		(61,827)		—		(89,248)		—		(59,880)		(191,453)		(1,263,383)		(1,665,791)
Other Income		—		—		—		—		—		—				—
		(61,827)		—		(89,248)		—		(59,880)		(191,453)		(1,263,383)		(1,665,791)
Net Income (Loss)	$	8,841	$	83,952	$	38,790	$	18,982	$	43,897	$	(89,655)	$	(713,828)	$	(609,021)
Net Income (Loss)—NERA 50%	$	4,421	$	41,976	$	19,395	$	9,491	$	21,949	$	(44,829)				52,403
Net Income —NERA 40%													$	(285,533)		(285,533)
															$	(233,130)

25

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 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 nine months ended September 30, 2022 was $70,000.

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 October 1, 2022, through January 19, 2023, the Partnership has purchased 1,658 Depository Receipts. The average price was $76.58 per receipt, or $2,297.40 per unit. The total cost was $127,565. The Partnership is required to purchase 13 Class B units and 1 General Partnership units at a cost of $30,154 and $1,587, respectively.

On October 3, 2022, the Management Company was the target of a ransomware attack. The Management Company has been engaged by the General Partner, to perform general management functions for the Company’s properties in exchange for management fees. After becoming aware of the incident, the Management Company conducted an initial investigation into their digital environment and discovered that all on premise computer systems were encrypted. The Management Company worked with independent third-party cybersecurity specialists through its outside counsel to help with the restoration of the environment and to return operations securely. Hamilton maintains off-site data backups, which were verified to have not been compromised by the ransomware attack and were utilized to restore the data that had been encrypted. The Management Company has successfully recovered the impacted files and rebuilt its computer systems, adding additional security features designed to protect its systems and data from future attacks. This incident was previously reported in the Company’s Current Report on Form 8-K filed with the SEC on October 11, 2022.

On October 14, 2022, the Partnership entered into a modification agreement with Brookline Bank modifying its loan on 659-665 Worcester Road, Framingham, MA. The agreement modifies the loan on the existing debt of $5,954,546.14, extending the maturity until October 14, 2032, at an interest rate of 4.6%, interest only for 2 years and amortizing using a thirty-year schedule for the balance of the term.  The agreement also allows for an earn out of up to an additional $1,495,453.86 once the property performance reaches a 1.35x debt service coverage ratio and the loan to value equates to at least 65%.

On November 15, 2022, (the Partnership received a notification letter from the Corporate Compliance Department of the NYSE American Exchange (the “NYSE American”) indicating that as of November 15, 2022, the Partnership is not in compliance with the NYSE American’s standards for continued listing of the Partnership’s Depositary Receipts on the NYSE American as set forth in Section 1007 of the NYSE American Company Guide (the “Company Guide”). The Partnership failed to timely file (the “Filing Delinquency”) the Partnership’s Form 10-Q for the quarter ended September 30, 2022 (the “Delayed Report”). The NYSE American notification letter has no immediate effect on the listing or trading of the Partnership’s Depositary Receipts on the NYSE American, nor will it have any effect on the Partnership's financial condition or results of operations.  The Filing Delinquency is the result of the above-mentioned cybersecurity incident and was previously reported in the Partnership’s Current Report on Form 8-K filed with the SEC on November 21, 2022. The Filing Delinquency will be cured via the filing of the Delayed Report, which is this Form 10-Q.

26

In November 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on December 31, 2022.

On December 5, 2022, Andrew Bloch, the Chief Financial Officer (“CFO”) of the Management Company, which has been engaged by the Partnership to manage the properties of the Partnership, resigned as Chief Financial Officer. Mr. Bloch will continue to work with Hamilton on a consultative basis to ensure a smooth transition of responsibilities to the new CFO. Mr. Bloch remains a director of the General Partner, and of the Management Company. Mr. Bloch’s decision to resign as CFO is not the result of any disagreement with the Partnership on any matter relating to the Partnership’s operations, policies, or practices. Mr. Bloch has served as CFO of the Management Company since 1998.

Effective as of December 5, 2022, the Board of Directors of the Management Company elected Karen N. Zermani as CFO of the Management Company to fill the vacancy created by the resignation of Mr. Bloch as CFO.

On December 12, 2022, the Partnership signed a purchase and sale agreement to purchase a commercial retail property of approximately 20,700 square feet, located at 659 Worcester Road in Framingham, Massachusetts for the sum of approximately $10,151,000. The Partnership has made a deposit of $500,000 to secure the transaction. This acquisition will be funded from the Partnership’s cash reserves. The Partnership closed on the transaction on January 18,2023.

On December 19, 2022, a class action was commenced in the United States District Court for the District of Massachusetts against a number of parties, including the Company:  Billie Jo White v. RealPage, Inc., et al, Case No. 1:22-cv-12134, United States District Court, District of Massachusetts (“RealPage Litigation”).

The first named defendant, RealPage, Inc., is allegedly the developer of a certain software platform known as “AI Revenue Management” (previously known as “YieldStar”).  In addition to RealPage, the Complaint names as defendants several companies, including the Company, allegedly owning, operating and/or managing residential real estate in the Greater Boston Metro Area (collectively, “Defendant Property Managers”).  The Complaint alleges that through the combined use of RealPage’s revenue management services, which allegedly included collecting non-public data regarding various factors influencing rents and generating a suggested rental price for each of the units controlled by a Defendant Property Manager using its services, the Defendant Property Managers constitute a rental “price-fixing cartel” in violation of federal and state anti-trust laws.  The Complaint seeks class certification and unspecified damages, trebled, together with attorney’s fees and other injunctive relief.  No class has yet been certified.

The Company disputes the allegations made against it and intends to vigorously defend the lawsuit.

The named Defendant Property Managers are the following:  Greystar Real Estate Partners, LLC; Cushman & Wakefield, Inc.; Lincoln Property Company; Peabody Properties, Inc.; New England Realty Associates Limited Partnership; WinnCompanies LLC and WinnResidential Manager Corp., UDR, Inc., SHP Management Corp., The Related Companies, Inc. and Simpson Property Group, LLLP.

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 2022 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

27

on past forward looking statements, which are based on results and trends at the time they are made, to anticipate future results or trends.

Over the last several months, the Partnership took advantage of the low interest rate environment and refinanced fifteen properties, increased their loan balances, and raised approximately $130,000,000. With interest rates rising, and a threat of an economic slowdown, the Partnership increased the debt level and built cash reserves to acquire additional properties when opportunities become available. Currently, $90,000,000 of these reserves are invested in short-term US Treasury bills maturing in 6 months or less with interest rates between 2.1% and 3.75%.

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.

More than two years has passed since we became aware of the outbreak of COVID- 19, The World Health Organization declared a global pandemic on March 11, 2020. On March 10, 2020 the Governor of Massachusetts declared a state of emergency and ordered all non-essential businesses closed. Additionally, March of 2020 saw the closure of local colleges and universities for the balance of the academic year. Colleges in the City of Boston and the surrounding communities conducted classes in the 2020/2021 academic year remotely, or using a hybrid model of remote and limited in class learning. These educational models caused a large decrease in the student population and resulted in significant vacancies in the Partnership’s apartment portfolio.

With the introduction and roll out of COVID vaccines in the spring of 2021, the economy was opening back up. The Governor of Massachusetts rescinded the State’s COVID-19 restrictions on May 29, 2021 and terminated the State of Emergency on June 15, 2021. The local colleges and universities returned to campus in September 2021 and the rental market improved significantly as students returned to the area.

On February 24, 2022, Russia began an invasion into Ukraine. In response, nations from around the world have placed sanctions on Russia in an attempt to cripple its economy. There is no way to predict how this conflict and the Russian sanctions will affect both the global and local economies.  If there is a downturn in the economy and significant inflation to the cost of energy, goods and service, there may be material adverse effects to our business, results of operations, cash flows, and financial condition.

The vacancy rate for the Partnership’s residential properties as of November 1, 2022 was 1.8% as compared with a vacancy rate of 2.5% as of November 1, 2021. The vacancy rate for the Joint Venture properties as of November 1, 2022 was 0.9%, as compared to 2.8% for the same period last year. The current vacancy rates are in line with those experienced prior to the Pandemic.

Residential tenants generally have lease terms of 12 months. The majority of these leases will mature during the second and third quarters of the year.

During the third quarter of 2022, rents increased on average of 6.7% for renewals and increased on average of 18.2% for new leases. For the balance of 2022, management expects a strong rental market with continued rent growth.

For the third quarter of 2022, consolidated revenue increased by 7.2%, operating expenses increased by 1.0 % and Income before Other Income (Expense) increased by 28.4%, as compared to the third quarter of 2021.

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. Prior to the line’s expiration in 2020, the Partnership exercised its option for a one-year extension until October 31, 2021. The Partnership paid an extension fee of approximately $37,500 in association with the extension.

28

On October 29, 2021, the Partnership closed on the modification of its existing line of credit. The agreement extends the credit line for three years until October 29, 2024. The commitment amount is for $25 million but is restricted to $17 million during the modification period. The modification period covers the current period and phases out by December 31, 2022. During this period, the loan covenants are modified from a minimum consolidated debt service ratio of 1.60 to a ratio of 1.35 until September 30, 2022; from a minimum tangible net worth requirement of $200 million to a net worth of $175 million until September 30, 2022; from a maximum consolidated leverage ratio of 65% to a ratio of 70% until September 30, 2022 and from a minimum debt yield of 9.5% to a yield of 8.5% until September 30, 2022 and a yield of 9.0% until December 31, 2022. Once the financial performance of the Partnership meets the original covenant tests for the trailing 12-month period, the commitment amount will return to $25 million. The portfolio’s debt yield fell below the minimum of 8.5% to 8.05%. As of September 30, 2022, the Partnership did not comply with the debt yield financial covenant. As such, the Partnership is unable to draw down any amount from the line of credit until the Partnership meets the required financial covenants.

From the start of the Stock Repurchase Program in 2007 through September 30, 2022, the Partnership has purchased 1,486,802 Depositary Receipts. During the nine months ended September 30, 2022, the Partnership purchased a total of 52,613 Depositary Receipts.

At November 1, 2022, the Harold Brown related entities and Ronald Brown collectively own approximately 31.7% of the Depositary Receipts representing the Partnership Class A Units (including Depositary Receipts held by trusts for the benefit of such persons’ family members). Harold Brown related entities also control 75% of the Partnership’s Class B Units, and 75% of the capital stock of NewReal, Inc. (“NewReal”), the Partnership’s sole general partner. 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 are owned by HBC Holdings LLC, an entity of which Jameson Brown is the manager. The outstanding stock of The Hamilton Company, Inc. is controlled by Jameson Brown and Harley Brown. The 75% of the issued and outstanding capital stock of NewReal, is owned by the Harold Brown 2013 Revocable Trust (the “2013 Trust”), an entity of which Sally Michaels and David Reier are the trustees.

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 nine months ended September 30, 2022, tenant renewals were approximately 68% with an average rental increase of approximately 6.2%, new leases accounted for approximately 32% with rental rate increases of approximately 16.1%. During the nine months ended September 30, 2022, leasing commissions were approximately $264,000 compared to approximately $642,000 for the nine months ended September 30, 2021, a decrease of approximately $378,000 (59.0%). Tenant concessions were approximately $39,000 for the nine months ended September 30, 2022, compared to approximately $34,000 for the nine months ended September 30, 2021, an increase of approximately $5,000 (14.7%). Tenant improvements were approximately $1,723,000 for the nine months ended September 30, 2022, compared to approximately $1,282,000 for the nine months ended September 30, 2021, an increase of approximately $441,000 (34.4%).

Hamilton accounted for approximately 2.6% of the repair and maintenance expenses paid for by the Partnership during the nine months ended September 30, 2022 and 2.4 % during the nine months ended September 30, 2021. 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

29

transactions. Overall, Hamilton provided approximately $162,000 (72.0%) and approximately $83,000 (60.5%) of the legal services paid for by the Partnership during the nine months ended September 30, 2022 and 2021 respectively.

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

The Partnership requires that three bids be obtained for construction contracts in excess of $15,000. Hamilton may be one of the three bidders on a particular project and may be awarded the contract if its bid and its ability to successfully complete the project are deemed appropriate. For contracts that are not awarded to Hamilton, Hamilton charges the Partnership a construction supervision fee equal to 5% of the contract amount. Hamilton’s architectural department also provides services to the Partnership on an as-needed basis. During the nine months ended September 30, 2022, Hamilton provided the Partnership approximately $89,000 in construction and architectural services, compared to approximately $413,000 for the nine months ended September 30, 2021.

Hamilton’s accounting staff perform bookkeeping and accounting functions for the Partnership. During the nine months ended September 30, 2022 and 2021, Hamilton charged the Partnership $93,750 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. Revenue from commercial leases also include reimbursements and recoveries 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 amounts are accounted for 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.

The Partnership evaluates the non-lease components (lease arrangements that include common area maintenance services) with related lease components (lease revenues). If both the timing and pattern of transfer are the same for the non-lease component and related lease component, the lease component is the predominant component. The Partnership elected an allowed practical expedient. For (i) operating lease arrangements involving real estate that include common area maintenance services and (ii) all real estate arrangements that include real estate taxes and insurance costs,

30

we present these amounts within lease revenues in our consolidated statements of income. We record amounts reimbursed by the lessee in the period in which the applicable expenses are incurred.

Rental Property Held 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 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.

Investments in Treasury Bills: Investments in Treasury Bills are recorded at amortized cost and classified as held to maturity as the Partnership has the intent and the ability to hold them until they mature. The carrying value of the Treasury Bills are adjusted for accretion of discounts over the remaining life of the investment. Income related to the Treasury Bills is recognized in interest income in the Partnership’s consolidated statement of income.

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

31

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. 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.

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

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

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

32

RESULTS OF OPERATIONS

Three Months Ended September 30, 2022 and September 30, 2021

The Partnership and its Subsidiary Partnerships earned income before interest expense, income from investments in unconsolidated joint ventures, other expense of approximately $4,561,000 during the three months ended September 30, 2022, compared to approximately $3,551,000 for the three months ended September 30, 2021, an increase of approximately $1,010,000 (28.4%).

The rental activity is summarized as follows:

	Occupancy Date
	November 1, 2022		November 1, 2021
Residential
Units	2,911		2,911
Vacancies	53		73
Vacancy rate	1.8	%	2.5	%
Commercial
Total square feet	108,043		108,043
Vacancy	20,274		2,152
Vacancy rate	18.8	%	2.0	%

	Rental Income (in thousands)
	Three Months Ended September 30,
	2022						2021
	Total			Continuing			Total			Continuing
	Operations			Operations			Operations			Operations
Total rents	$	16,975		$	16,975		$	15,832		$	15,832
Residential percentage		95	%		95	%		95	%		95	%
Commercial percentage		5	%		5	%		5	%		5	%
Contingent rentals	$	4		$	4		$	127		$	127

33

Three Months Ended September 30, 2022 Compared to Three Months Ended September 30, 2021:

	Three Months Ended September 30,				Dollar		Percent
	2022		2021		Change		Change
Revenues
Rental income	$	16,974,515	$	15,832,492	$	1,142,023	7.2%
Laundry and sundry income		103,868		114,180		(10,312)	(9.0%)
		17,078,383		15,946,672		1,131,711	7.1%
Expenses
Administrative		696,656		607,478		89,178	14.7%
Depreciation and amortization		4,114,913		3,956,979		157,934	4.0%
Management fee		683,999		646,059		37,940	5.9%
Operating		1,410,843		1,338,718		72,125	5.4%
Renting		181,574		458,040		(276,466)	(60.4%)
Repairs and maintenance		3,126,953		3,128,369		(1,416)	(0.0%)
Taxes and insurance		2,302,648		2,259,793		42,855	1.9%
		12,517,586		12,395,436		122,150	1.0%
Income Before Other Income (Expense)		4,560,797		3,551,236		1,009,561	28.4%
Other Income (Expense)
Interest income		363,350		27		363,323	100%
Interest expense		(3,982,445)		(3,393,518)		(588,927)	17.4%
Income from investments in unconsolidated joint ventures		93,516		(233,130)		326,646	(140.1%)
Other Income (Expense)		(39,994)		—		(39,994)	100.0%
		(3,565,573)		(3,626,621)		61,048	(1.7%)
Net Income	$	995,224	$	(75,385)	$	1,070,609	1420.3%

Rental income for the three months ended September 30, 2022 was approximately $16,974,000, compared to approximately $15,832,000 for the three months ended September 30, 2021, an increase of approximately $1,142,000 (7.2%). The Partnership properties with the largest increases in rental income include 62 Boylston, 1144 Commonwealth, Westgate Apartments, Hamilton Green, and Mill Street Gardens with increases of $455,000, $213,000, $101,000, $89,000 and $84,000 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 September 30, 2022 were approximately $12,517,000 compared to approximately $12,395,000 for the three months ended September 30, 2021, an increase of approximately $122,000 (1.0%), The factors contributing to the increase are an increase in depreciation and amortization of approximately $158,000 (4.0%), an increase in administrative expenses of approximately $89,000 (14.7%), and an increase in operating costs of approximately $72,000 (5.4%), partially offset by a decrease in renting expenses of approximately $276,000 (60.4%).

Interest expense for the three months ended September 30, 2022 was approximately $3,982,000 compared to approximately $3,393,000 for the three months ended September 30, 2021, an increase of approximately $589,000 (17.4 %). The increase is due to the refinancing of properties, increasing the amount of the debt, which increased the interest expense for the period.

Interest income for the three months ended September 30, 2022 was approximately $363,000 compared to approximately $0 for the three months ended September 30, 2021, an increase of approximately $363,000. The increase is due to investments in Treasury Bills which mature over a period less than 180 days, with interest rates between 2.1% to 3.9%.

At September 30, 2022, the Partnership has between a 40% and 50% ownership interests in seven 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.

34

As described in Note 14 to the Consolidated Financial Statements, the Partnership’s share of the net income from the Investment Properties was approximately $93,000 for the three months ended September 30, 2022, compared to a net loss of approximately $233,000 for the three months ended September 30, 2021, an increase in income of approximately $326,000 (140.1%). This increase is primarily due to an increase in rental revenue to approximately $2,625,000 from $2,329,000, an increase of approximately $296,000 (12.7 %) for the three months ended September 30, 2022 compared to the three months ended September 30, 2021. Included in the income for the three months ended September 30, 2022 is depreciation and amortization expense of approximately $662,000.

As a result of the changes discussed above, net income for the three months ended September 30, 2022 was approximately $995,000 compared to a net loss of approximately $75,000 for the three months ended September 30, 2021, an increase in income of approximately $1,070,000 (1,420.3%).

35

Nine Months Ended September 30, 2022 Compared to Nine Months Ended September 30, 2021:

The Partnership and its Subsidiary Partnerships earned income before interest expense, income from investments in unconsolidated joint ventures, and other expense of approximately $12,949,000 during the nine months ended September 30, 2022, compared to approximately $11,134,000 for the nine months ended September 30, 2021, an increase of approximately $1,815,000 (16.3%).

	Nine Months Ended September 30,				Dollar		Percent
	2022		2021		Change		Change
Revenues
Rental income	$	50,260,258	$	46,145,825	$	4,114,433	8.9%
Laundry and sundry income		330,461		336,980		(6,519)	(1.9%)
		50,590,719		46,482,805		4,107,914	8.8%
Expenses
Administrative		2,028,319		1,819,481		208,838	11.5%
Depreciation and amortization		12,212,278		11,806,561		405,717	3.4%
Management fee		2,029,453		1,867,798		161,655	8.7%
Operating		5,609,302		4,792,332		816,970	17.0%
Renting		501,906		941,281		(439,375)	(46.7)%
Repairs and maintenance		8,381,339		7,432,860		948,479	12.8%
Taxes and insurance		6,879,455		6,688,885		190,570	2.8%
		37,642,052		35,349,198		2,292,854	6.5%
Income Before Other Income ( Expense)		12,948,667		11,133,607		1,815,060	16.3%
Other Income (Expense)
Interest income		363,411		74		363,337	100.0%
Interest (expense)		(11,060,794)		(10,136,630)		(924,164)	9.1%
Income from investments in unconsolidated joint ventures		203,867		(796,725)		1,000,592	(125.6%)
Other (Expense) Income		(874,526)		—		(874,526)	100.0%
		(11,368,042)		(10,933,281)		(434,761)	4.0%
Net Income	$	1,580,625	$	200,326	$	1,380,299	689.0%

Rental income for the nine months ended September 30, 2022 was approximately $50,260,000, compared to approximately $46,146,000 for the nine months ended September 30, 2021, an increase of approximately $4,114,000 (8.9%). The Partnership properties with the largest increases in rental income include 62 Boylston, 1144 Commonwealth, Westgate Apartments, Hamilton Green, and Mill Street Gardens, with increases of $1,524,000, $494,000, $282,000, 249,000 and $238,000 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 nine months ended September 30, 2022 were approximately $37,642,000 compared to approximately $35,349,000 for the nine months ended September 30, 2021, an increase of approximately $2,293,000 (6.5%), primarily due to an increase in the refurbishment of apartments, and an increase in snow removal expense during the winter. The factors contributing to this net increase are an increase in repairs and maintenance expenses of approximately $948,000 (12.8%), an increase in operating expense of approximately $817,000 (17.0%), and an increase in depreciation and amortization of approximately $406,000 (3.4%), partially offset by a decrease in renting expense of approximately $439,000 (46.7%).

Interest income for the nine months ended September 30, 2022 was approximately $363,000 compared to approximately $0 for the three months ended September 30, 2021, an increase of approximately $363,000. The increase is due to investments in Treasury Bills which mature over a period less than 180 days, with interest rates between 2.1% to 3.9%.

36

Interest expense for the nine months ended September 30, 2022 was approximately $11,061,000 compared to approximately $10,137,000 for the nine months ended September 30, 2021, an increase of approximately $924,000 (9.1%). The increase is due to the refinancing of properties, increasing the amount of debt, which increased the interest expense for the period.

At September 30, 2022, the Partnership has between a 40% and 50% ownership interests in seven 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 $204,000 for the nine months ended September 30, 2022, compared to a net loss of approximately $797,000 for the nine months ended September 30, 2021, an increase in income of approximately $1,001,000 (125.6%). This increase is primarily due to an increase in rental revenue of approximately $ 7,526,000 for the nine months ended September 30, 2022 from approximately $6,543,000 for the nine months ended September 30, 2021, an increase of approximately $983,000 (15.0 %). Included in the income for the nine months ended September 30, 2022 is depreciation and amortization expense of approximately $1,971,000.

On November 30, 2021, the Partnership entered into a Master Credit Facility Agreement (the “Facility Agreement”) with KeyBank National Association (“KeyBank”) dated as of November 30, 2021, with an initial advance in the amount of $156,000,000. Interest only on the debt at a fixed interest rate of 2.97% is payable on a monthly basis through December 31, 2031.

On June 16, 2022, the Partnership entered into an amendment to the Facility Agreement. The additional advance under the Amended Agreement is in the amount of $80,284,000, at a fixed interest rate of 4.33%. The Partnership’s obligations under the Facility Agreement are secured by mortgages on certain properties pursuant to certain Mortgage, Assignment of Leases and Rents, and Security Agreement and Fixture Filings.

The Partnership used the proceeds from the June, 2022 refinancing to pay down approximately $37,065,000 of existing debt secured by four properties, along with approximately $894,000 in prepayment penalties, which are included in other expenses. The remaining balance of approximately $42,384,000 will be used for general partnership purposes.

As a result of the changes discussed above, net income for the nine months ended September 30, 2022 was approximately $1,580,000 compared to income of approximately $200,000 for the nine months ended September 30, 2021, an increase in net income of approximately $1,380,000 (689.0%).

37

LIQUIDITY AND CAPITAL RESOURCES

The Partnership’s principal source of cash during the first nine months of 2022 and 2021 was the proceeds from the refinancing of 4 properties for approximately $42,000,000 and the collection of rents. The Partnership’s principal use of cash during the first nine months of 2022 was the purchase of Treasury Bills. The majority of cash and cash equivalents of $59,473,939 at September 30, 2022 and $96,083,508 at December 31, 2021 were held in interest bearing accounts at creditworthy financial institutions.

The decrease in cash of $36,609,569 for the nine months ended September 30, 2022 is summarized as follows:

	Nine Months Ended September 30,
	2022		2021
Cash provided by operating activities	$	13,033,520	$	12,848,551
Cash (used in) investing activities		(76,569,294)		(1,667,942)
Cash provided by (used in) financing activities		40,217,002		(1,704,743)
Repurchase of Depositary Receipts, Class B and General Partner Units		(5,167,667)		—
Distributions paid		(8,123,130)		(3,506,581)
Net (decrease) increase in cash and cash equivalents	$	(36,609,569)	$	5,969,285

The change in cash provided by operating activities is due to various factors, including a change in depreciation expense, a change in income and distribution from joint ventures, and other factors. The decrease in cash used in investing activities is primarily due to improvements to rental properties, and the purchase of Treasury Bills. The change in cash used in financing activities is due to the refinancing of 4 properties, the pay down of mortgages, the repurchase of depositary receipts, and distributions paid.

During 2022, the Partnership and its Subsidiary Partnerships have completed improvements to certain of the Properties at a total cost of approximately $3,709,000. These improvements were funded from cash reserves. Cash reserves have been adequate to fully fund improvements. The most significant improvements were made at Hamilton Oaks, Captain Parker, Hamilton Green, Westside Colonial, River Drive Apartments, and Redwood Hills at a cost of approximately $747,000, $313,000, $299,000, $292,000, $282,000 and $246,000 respectively.

During the nine months ended September 30, 2022, the Partnership received distributions of approximately $1,207,500 from the investment properties. For the nine months ended September 30, 2021, the Partnership received $590,000 in distributions from the investment properties. Included in these net distributions is the amount from Dexter Park of approximately $840,000 and $80,000 for the nine months ended September 30, 2022 and 2021, respectively.

In January 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), which was paid on March 31, 2022. In addition to the quarterly distribution, there was a special distribution of $38.40 per Class A unit ($1.28 per Receipt) payable on March 31, 2022. In April 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), which was paid on June 30, 2022. In July 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), which was paid on September 30, 2022.

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 in 2017 were approximately $128,000. Prior to the line’s expiration in 2020, the Partnership exercised its option for a one-year extension until October 31, 2021. The Partnership paid an extension fee of approximately $37,500 in association with the extension. The Partnership agreed to terms with the lender on October 29, 2021, to extend the line of credit until October 29, 2024. On December 3,

2021, the Partnership paid off the line.

The Partnership anticipates that cash from operations 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

38

a result of the sale or refinancing of properties, property improvements, increases or decreases in rental income or expenses, or the loss of significant tenants.

Off-Balance Sheet Arrangements—Joint Venture Indebtedness

As of September 30, 2022, the Partnership had a 40%-50% ownership interest in seven 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 September 30, 2022, our proportionate share of the non-recourse debt related to these investments was approximately $70,835,000. See Note 14 to the Consolidated Financial Statements.

39

Contractual Obligations

As of September 30, 2022, we are subject to contractual payment obligations as described in the table below.

				Payments due by period
		2023		2024		2025		2026		2027		Thereafter		Total
Contractual Obligations
Long-term debt
Mortgage debt *	$	8,582,753		2,748,462		3,259,573		25,209,263		3,121,211		371,767,319	$	414,688,581
Total Contractual Obligations	$	8,582,753	$	2,748,462	$	3,259,573	$	25,209,263	$	3,121,211	$	371,767,319	$	414,688,581

*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 of the Partnership’s Form 10-K for the fiscal year ended December 31, 2021 filed with the Securities and Exchange Commission on March 11, 2022 and from time to time in the Partnership’s other filings with the Securities and Exchange Commission, some factors that could cause the Partnership’s actual results, performance or achievements to differ materially from those expressed or implied by forward looking statements include but are not limited to the following:

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

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

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

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

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

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

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

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

40

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

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

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

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

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

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

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

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

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

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

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

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 September 30, 2022, the Partnership, its Subsidiary Partnerships and the Investment Properties collectively have approximately $581,358,000 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 2035. The Partnership, its Subsidiary Partnerships and the Investment Properties collectively have variable rate debt of $10,000,000 (without taking out unamortized deferred financing costs) as of September 30, 2022. Interest rates ranged from LIBOR plus 195 basis points to LIBOR plus 300 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

41

basis points, then the increase or decrease in interest costs on the Partnership’s variable rate debt would be approximately $50,000 annually and the increase or decrease in the fair value of the Partnership’s fixed rate debt as of September 30, 2022 would be approximately $24.0 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 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”)) have been evaluated as of the end of the period covered by this report. Based on that evaluation, under the supervision and with the participation of the Hamilton Company, Inc. (the “Management Company”), Management concluded that IT control and related procedures that support financial reporting were not effective as of September 30, 2022 due to the material weaknesses described below that prevented the 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.

Management Report on Internal Control over Financial Reporting. On October 3, 2022, the Management Company was the target of a ransomware attack. The Partnership did not incur any monetary damage nor any loss of financial data due to the incident. After becoming aware of the incident, the Management Company conducted an internal investigation into their digital environment and discovered that all on premise computer systems were encrypted by an outside party. The Partnership, along with the Management Company, worked with independent third-party cybersecurity specialists to help with the restoration of the environment and to return operations securely. Off-site data backups, which were verified to have not been compromised by the ransomware attack, were utilized to restore the data that had been encrypted. The Partnership, along with the Management Company, has successfully recovered the impacted files and rebuilt its computer systems. However, Management determined that the inordinate amount of time to recover this data and rebuild the financial reporting system prevented the Partnership from filing this Quarterly Report on a timely basis.

The Partnership is committed to remediating the material weaknesses in a timely manner. With the assistance of cybersecurity specialists, the Partnership and the Management Company have added additional security features designed to protect its systems and data from future attacks including multifactor authentication for domain sign-on, restricted server access, enhanced security awareness training, and updated multi-location secure backup with regular recovery testing. In addition to these steps already taken, remediation will also include the documentation and testing of the additional IT procedures implemented.

Limitations on Effectiveness of Controls. Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). Our internal control system is designed to provide reasonable assurance regarding the preparation and fair presentation of our financial statements for external purposes in accordance with GAAP. All internal control systems, no matter how well designed, have inherent limitations and can provide only reasonable assurance that the objectives of the internal control system are met.

Changes in Internal Control over Financial Reporting. Except for the above noted material weaknesses and the remediation activities that have already begun, there were no other changes in the Management Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13a-15 that occurred during the quarter ended September 30, 2022 that have materially affected or are reasonably likely to materially affect, the Management Company’s internal control over financial reporting.

42

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 in Item 1A, “Risk Factors” in our annual report on Form 10K for the year ended December 31, 2021.

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

(a) None

(b) None

(c) Issuer Purchase of Equity Securities during the third quarter of 2022:

				Remaining number
			Depositary Receipts	of Depositary Receipts
			Purchased as Part	that may be purchased
	Average		of Publicly	Under the Plan
Period	Price Paid		Announced Plan	(as Amended)
July 1-31, 2022	$	78.14	3,289	524,747
August 1-31, 2022	$	80.45	8,447	516,300
September 1-30, 2022	$	79.07	3,104	513,196
Total			14,840

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. On March 9, 2020, the General Partner extended the program for an additional five years from March 31, 2020 to March 31, 2025. 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 Restated 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 September 30, 2022, the Partnership has repurchased 1,486,802 Depositary Receipts at an average price of $30.09 per receipt (or $902.70 per underlying Class A Unit), 4,034 Class B Units and 212 General Partnership Units, both at an average price of $1,179.00 per Unit, totaling approximately $50,336,000 including brokerage fees paid by the Partnership.

During the nine months ended September 30, 2022, the Partnership purchased a total of 52,613 Depositary Receipts. The average price was $78.53 per receipt or $2,355.90 per unit. The cost including commission was $4,134,773. The Partnership was required to repurchase 416.52 Class B Units and 21.92 General Partnership units at a cost of $981,249 and $51,645 respectively.

Item 3. Defaults Upon Senior Securities

None.

43

Item 4. Mine Safety Disclosure

Not applicable.

Item 5. Other Information

On December 5, 2022, Andrew Bloch, the Chief Financial Officer (“CFO”) of The Hamilton Company, Inc., which has been engaged by the Partnership to manage the properties of the Partnership, resigned as Chief Financial Officer. Mr. Bloch remains as a director of NewReal, Inc., the general partner of the Partnership, and of Hamilton. Mr. Bloch’s decision to resign as CFO is not the result of any disagreement with the Partnership on any matter relating to the Partnership’s operations, policies, or practices. Mr. Bloch has served as CFO of Hamilton since 1998.

Effective as of December 5, 2022, the Board of Directors of Hamilton elected Karen N. Zermani as CFO of Hamilton to fill the vacancy created by the resignation of Mr. Bloch as CFO.

Prior to joining The Hamilton Company, Inc. as CFO, Ms. Zermani served as CFO of ClearPlan LLC since 2021. Prior to ClearPlan LLC, Ms. Zermani served as Vice President of Investments for Benchmark Senior Living from 2017 to 2021. Ms. Zermani served as Chief Financial Officer of Maplewood Senior Living from 2016 to 2017 and as Managing Director of Finance and Accounting for Blue Moon Capital Partners from 2015 to 2016. Ms. Zermani served as Chief Financial Officer for the Kensington Investment Company from 2012 to 2015. Ms. Zermani received her BA from the University of Pennsylvania, her MA from the University of Pennsylvania’s Fels Center of Government and her MBA from the MIT Sloan School of Management.

On December 19, 2022, a class action was commenced in the United States District Court for the District of Massachusetts against a number of parties, including the Company:  Billie Jo White v. RealPage, Inc., et al, Case No. 1:22-cv-12134, United States District Court, District of Massachusetts (“RealPage Litigation”).

The first named defendant, RealPage, Inc., is allegedly the developer of a certain software platform known as “AI Revenue Management” (previously known as “YieldStar”).  In addition to RealPage, the Complaint names as defendants several companies, including the Company, allegedly owning, operating and/or managing residential real estate in the Greater Boston Metro Area (collectively, “Defendant Property Managers”).  The Complaint alleges that through the combined use of RealPage’s revenue management services, which allegedly included collecting non-public data regarding various factors influencing rents and generating a suggested rental price for each of the units controlled by a Defendant Property Manager using its services, the Defendant Property Managers constitute a rental “price-fixing cartel” in violation of federal and state anti-trust laws.  The Complaint seeks class certification and unspecified damages, trebled, together with attorney’s fees and other injunctive relief.  No class has yet been certified.

The Company disputes the allegations made against it and intends to vigorously defend the lawsuit.

The named Defendant Property Managers are the following:  Greystar Real Estate Partners, LLC; Cushman & Wakefield, Inc.; Lincoln Property Company; Peabody Properties, Inc.; New England Realty Associates Limited Partnership; WinnCompanies LLC and WinnResidential Manager Corp.; UDR, Inc.; SHP Management Corp.; The Related Companies, Inc. and Simpson Property Group, LLLP.

Item 6. Exhibits

See the exhibit index below.

44

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 June 30, 2022, formatted in Inline XBRL (eXtensible Business Property Language: (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) (filed herewith).
(104)	Cover Page Interactive Data File – The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

.

45

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: January 19, 2023

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	January 19, 2023
Ronald Brown	(Principal Executive Officer)
/s/ JAMESON BROWN	Treasurer and Director of the General Partner	January 19, 2023
Jameson Brown	(Principal Financial Officer and Principal Accounting Officer)
/s/ MARTINA ALIBRANDI	Director of the General Partner	January 19, 2023
Martina Alibrandi
/s/ DAVID ALOISE	Director of the General Partner	January 19, 2023
David Aloise
/s/ ANDREW BLOCH	Director of the General Partner	January 19, 2023
Andrew Bloch
/s/ SALLY MICHAEL	Director of the General Partner	January 19, 2023
Sally Michael
/s/ DAVID REIER	Director of the General Partner	January 19, 2023
David Reier

46

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: January 19, 2023

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: January 19, 2023

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 nine months ended September 30, 2022, 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: January 19, 2023
	/s/ Jameson Brown
	Jameson Brown
	Principal Financial Officer
	(Treasurer and Director of the Partnership’s General Partner, NewReal, Inc.)
Date: January 19, 2023

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	9 Months Ended
	Sep. 30, 2022	Jan. 19, 2023
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2022
Entity File Number	001-31568
Entity Registrant Name	New England Realty Associates Limited Partnership
Entity Incorporation, State or Country Code	MA
Entity Tax Identification Number	04-2619298
Entity Address, Address Line One	39 Brighton Avenue
Entity Address, City or Town	Allston
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02134
City Area Code	617
Local Phone Number	783-0039
Title of 12(b) Security	Class A
Trading Symbol	NEN
Security Exchange Name	NYSEAMER
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Entity Central Index Key	0000746514
Amendment Flag	false
Class A
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		95,404
Class B
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		22,658

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2022	Dec. 31, 2021
ASSETS
Rental Properties	$ 242,937,926	$ 251,355,202
Cash and Cash Equivalents	59,473,939	96,083,508
Rents Receivable	414,659	935,303
Real Estate Tax Escrows	1,907,378	861,697
Investment in U.S. Treasury Bills	73,995,586
Prepaid Expenses and Other Assets	7,613,638	6,183,981
Investments in Unconsolidated Joint Ventures	1,439,150	1,455,888
Total Assets	387,782,276	356,875,579
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	411,475,632	370,481,390
Distribution and Loss in Excess of Investment in Unconsolidated Joint Venture	24,136,809	22,992,420
Accounts Payable and Accrued Expenses	4,298,250	4,324,879
Advance Rental Payments and Security Deposits	8,874,364	8,369,497
Total Liabilities	448,785,055	406,168,186
Commitments and Contingent Liabilities (Notes 3 and 9)
Partners' Capital 119,324 and 121,516 units outstanding in 2022 and 2021 respectively	(61,002,779)	(49,292,607)
Total Liabilities and Partners' Capital	$ 387,782,276	$ 356,875,579

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020
CONSOLIDATED BALANCE SHEETS
Partners' Capital, units outstanding	119,324	121,516	121,756	121,756

XML

CONSOLIDATED STATEMENTS OF INCOME - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenues
Rental income	$ 16,974,515	$ 15,832,492	$ 50,260,258	$ 46,145,825
Laundry and sundry income	103,868	114,180	330,461	336,980
Total Revenues	17,078,383	15,946,672	50,590,719	46,482,805
Expenses
Administrative	696,656	607,478	2,028,319	1,819,481
Depreciation and amortization	4,114,913	3,956,979	12,212,278	11,806,561
Management fee	683,999	646,059	2,029,453	1,867,798
Operating	1,410,843	1,338,718	5,609,302	4,792,332
Renting	181,574	458,040	501,906	941,281
Repairs and maintenance	3,126,953	3,128,369	8,381,339	7,432,860
Taxes and insurance	2,302,648	2,259,793	6,879,455	6,688,885
Total Expenses	12,517,586	12,395,436	37,642,052	35,349,198
Income Before Other Income (Expense)	4,560,797	3,551,236	12,948,667	11,133,607
Other Income (Expense)
Interest income	363,350	27	363,411	74
Interest expense	(3,982,445)	(3,393,518)	(11,060,794)	(10,136,630)
Income (loss) from investments in unconsolidated joint ventures	93,516	(233,130)	203,867	(796,725)
Other (expenses)	(39,994)		(874,526)
Total Other Income (Expense)	(3,565,573)	(3,626,621)	(11,368,042)	(10,933,281)
Net Income	$ 995,224	$ (75,385)	$ 1,580,625	$ 200,326
Income per Unit
Net Income per Unit (in dollars per unit)	$ 8.32	$ (0.62)	$ 13.12	$ 1.65
Weighted Average Number of Units Outstanding (in units)	119,638	121,756	120,465	121,756

XML

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNER'S CAPITAL - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Increase (Decrease) in Partners' Capital
Balance			$ (49,292,607)	$ (41,469,045)
Balance (in units)			121,516	121,756
Distribution to Partners			$ (8,123,130)	$ (3,506,581)
Stock Buyback			$ (5,167,667)
Stock Buyback (in units)			(2,192)
Net income	$ 995,224	$ (75,385)	$ 1,580,625	200,326
Balance	$ (61,002,779)	$ (44,775,300)	$ (61,002,779)	$ (44,775,300)
Balance (in units)	119,324	121,756	119,324	121,756
Subtotal
Increase (Decrease) in Partners' Capital
Balance (in units)			180,225	180,225
Balance (in units)	180,225	180,225	180,225	180,225
General Partnership
Increase (Decrease) in Partners' Capital
Balance			$ (491,512)	$ (413,280)
Balance (in units)			1,802	1,802
Distribution to Partners			$ (81,231)	$ (35,065)
Stock Buyback			(51,645)
Net income			15,806	2,003
Balance	$ (608,582)	$ (446,342)	$ (608,582)	$ (446,342)
Balance (in units)	1,802	1,802	1,802	1,802
Treasury Units
Increase (Decrease) in Partners' Capital
Balance (in units)			(58,709)	58,469
Stock Buyback (in units)			(2,192)
Balance (in units)	(60,901)	58,469	(60,901)	58,469
Class A
Increase (Decrease) in Partners' Capital
Balance			$ (39,462,357)	$ (33,203,447)
Balance (in units)			144,180	144,180
Distribution to Partners			$ (6,498,504)	$ (2,805,265)
Stock Buyback			(4,134,773)
Net income			1,264,500	160,261
Balance	$ (48,831,134)	$ (35,848,451)	$ (48,831,134)	$ (35,848,451)
Balance (in units)	144,180	144,180	144,180	144,180
Class B
Increase (Decrease) in Partners' Capital
Balance			$ (9,338,738)	$ (7,852,318)
Balance (in units)			34,243	34,243
Distribution to Partners			$ (1,543,395)	$ (666,251)
Stock Buyback			(981,249)
Net income			300,319	38,062
Balance	$ (11,563,063)	$ (8,480,507)	$ (11,563,063)	$ (8,480,507)
Balance (in units)	34,243	34,243	34,243	34,243

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash Flows from Operating Activities
Net Income	$ 1,580,625	$ 200,326
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	12,212,278	11,806,561
Amortization of deferred finance costs	350,115	179,879
(Income) Loss from investments in joint ventures	(203,867)	796,725
Allowance for doubtful accounts		906,986
Change in operating assets and liabilities
Proceeds from unconsolidated joint ventures	72,500	27,250
Decrease (Increase) in rents receivable	520,644	(498,584)
(Decrease) Increase in accounts payable and accrued expense	(26,636)	413,183
(Increase) in real estate tax escrow	(1,045,681)	(32,970)
(Increase) in prepaid expenses and other assets	(931,325)	(1,195,693)
Increase in advance rental payments and security deposits	504,867	244,888
Total Adjustments	11,452,895	12,648,225
Net cash provided by operating activities	13,033,520	12,848,551
Cash Flows From Investing Activities
Distribution in excess of investment in unconsolidated joint ventures	1,135,000	603,202
(Investment) in unconsolidated joint ventures		(40,702)
Investment in U.S. Treasury Bills	(103,995,587)
Proceeds from U.S. Treasury Bills	30,000,000
Improvement of rental properties	(3,708,707)	(2,230,442)
Net cash (used in) investing activities	(76,569,294)	(1,667,942)
Cash Flows from Financing Activities
Principal payments of mortgage notes payable	(1,720,335)	(1,704,743)
Proceeds from Mortgage Notes Payable	41,937,337
Stock buyback	(5,167,667)
Distributions to partners	(8,123,130)	(3,506,581)
Net cash provided by (used in) financing activities	26,926,205	(5,211,324)
Net (Decrease) Increase in Cash and Cash Equivalents	(36,609,569)	5,969,285
Cash and Cash Equivalents, at beginning of period	96,083,508	18,646,972
Cash and Cash Equivalents, at end of period	$ 59,473,939	$ 24,616,257

XML

SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2022

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

Line of Business: New England Realty Associates Limited Partnership (“NERA”, the “Company” or the “Partnership”) was organized in Massachusetts in 1977. NERA and its subsidiaries own 29 properties which include 21 residential buildings; 4 mixed use residential, retail and office buildings; 3 commercial buildings and individual units at one condominium complex. These properties total 2,892 apartment units, 19 condominium units and 108,043 square feet of commercial space. Additionally, the Partnership also owns a 40 - 50% interest in 7 residential and mixed use properties consisting of 688 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 seven 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. Revenue from commercial leases also include reimbursements and recoveries 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 amounts are accounted for 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.

The Partnership evaluates the non-lease components (lease arrangements that include common area maintenance services) with related lease components (lease revenues). If both the timing and pattern of transfer are the same for the non-lease component and related lease component, the lease component is the predominant component. The Partnership elected an allowed practical expedient. For (i) operating lease arrangements involving real estate that include common area maintenance services and (ii) all real estate arrangements that include real estate taxes and insurance costs, we present these amounts within lease revenues in our consolidated statements of income. We record amounts reimbursed by the lessee in the period in which the applicable expenses are incurred.

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 $350,000 and $180,000 for the nine months ended September 30, 2022 and 2021, 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 at the time of purchase.

Investments in Treasury Bills: Investments in Treasury Bills are recorded at amortized cost and classified as held to maturity as the Partnership has the intent and the ability to hold them until they mature. The carrying value of the Treasury Bills are adjusted for accretion of discounts over the remaining life of the investment. Income related to the Treasury Bills is recognized in interest income in the Partnership’s consolidated statement of income.

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 2022 or 2021 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 2022 or 2021. The Partnership makes its temporary cash investments with high-credit quality financial institutions. At September 30, 2022, substantially all of the Partnership’s cash and cash equivalents were held in interest-bearing accounts at financial institutions, and investments in U.S. Treasury bills, earning interest at rates from 0.01% to 2.19%. At September 30, 2022 and December 31, 2021, respectively approximately $45,045,000, and $96,166,000 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 $190,316 and $240,814 for the nine months ended September 30, 2022, and 2021, respectively.

Rental Property Held 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.

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 nine months ended September 30, 2022, and 2021 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 refinancings qualify as extinguishment of debt.

Reclassification: Certain reclassifications have been made to prior period amounts in order to conform to current period presentation.

XML

RENTAL PROPERTIES

9 Months Ended

Sep. 30, 2022

RENTAL PROPERTIES

RENTAL PROPERTIES

NOTE 2. RENTAL PROPERTIES

As of September 30, 2022, the Partnership and its Subsidiary Partnerships owned 2,892 residential apartment units in 25 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 September 30, 2022, 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 seven residential and mixed use complexes (the “Investment Properties”) at September 30, 2022 with a total of 688 apartment units, accounted for using the equity method of consolidation. See Note 14 for summary information on these investments.

Rental properties consist of the following:

	September 30, 2022		December 31, 2021		Useful Life
Land, improvements and parking lots	$	87,506,136	$	86,887,276	15	-	40	years
Buildings and improvements		254,618,756		253,952,680	15	-	40	years
Kitchen cabinets		17,384,297		16,946,916	5	-	10	years
Carpets		12,751,418		12,029,577	5	-	10	years
Air conditioning		501,697		501,697	5	-	10	years
Laundry equipment		613,961		608,271	5	-	7	years
Elevators		1,885,265		1,885,265	20	-	40	years
Swimming pools		1,090,604		1,090,604	10	-	30	years
Equipment		18,767,307		18,072,761	5	-	30	years
Motor vehicles		171,519		171,519			5	years
Fences		46,872		46,872	5	-	15	years
Furniture and fixtures		8,462,476		7,898,163	5	-	7	years
Smoke alarms		496,641		496,641	5	-	7	years
Total fixed assets		404,296,949		400,588,242
Less: Accumulated depreciation		(161,359,023)		(149,233,040)
	$	242,937,926	$	251,355,202

XML

RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2022

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

NOTE 3. RELATED PARTY TRANSACTIONS

The Partnership’s properties are managed by The Hamilton Company, Inc. (the “Management Company”) an entity that is owned by the majority shareholder of NewReal, Inc., the general partner of the Partnership (the “General Partner”). The management fee is equal to 4% of gross receipts of rental revenue and laundry income on the majority of the Partnership’s properties and 3% on Linewt. Total fees paid were approximately $2,029,000 and $1,868,000 for the nine months ended September 30, 2022 and 2021, respectively.

The Partnership Agreement permits the General Partner or the Management Company to charge the costs of professional services (such as counsel, accountants and contractors) to NERA. During the nine months ended September 30, 2022 and 2021, approximately $583,000 and $766,000 was charged to NERA for legal, accounting, construction, maintenance, brokerage fees, rental and architectural services and supervision of capital improvements. Of the 2022 expenses referred to above, approximately $215,000 consisted of repairs and maintenance, $256,000 of administrative expense, and approximately $23,000 for renting expense. Approximately $89,000 of expenses for construction, architectural services and supervision of capital projects were capitalized in rental properties. Additionally in 2022, the Hamilton Company received approximately $567,000 from the Investment Properties of which approximately $491,000 was the management fee, approximately $38,000 was for maintenance services, approximately $14,000 was for administrative services and approximately $24,000 for construction, 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 $2,945,000 and $2,759,000 for the nine months ended September 30, 2022 and 2021, 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. For the nine months ended September 30, 2022, the Partnership accrued $70,000 for the employer’s match portion to the plan. For the nine months ended September 30, 2021, the Partnership contributed $33,000 for the employer’s match portion to the plan.

Bookkeeping and accounting functions are provided by the Management Company’s accounting staff, which consists of approximately 14 people. During the nine months ended September 30, 2022 and 2021, the Management Company charged the Partnership $93,750 ($125,000 per year) for bookkeeping and accounting services included in administrative expenses above.

Sally Michael is a Director of New Real, Inc., and she is a Partner at Saul Ewing Arnstein & Lear LLP. Saul Ewing billed the Partnership for legal fees totaling approximately $68,000 and $8,000 for the nine months ended September 30, 2022 and 2021 respectively.

The Partnership has invested in seven 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 Brown family related entities, and five current and previous employees of the Management Company. The Brown Family related entities’ ownership interest was between 47.6% and 59%. See Note 14 for a description of the properties and their operations.

XML

OTHER ASSETS

9 Months Ended

Sep. 30, 2022

OTHER ASSETS

OTHER ASSETS

NOTE 4. PREPAID EXPENSES and OTHER ASSETS

Approximately $3,402,000, and $3,067,000 of security deposits are included in prepaid expenses and other assets at September 30, 2022 and December 31, 2021, respectively. The security deposits and escrow accounts are restricted cash.

Also, included in prepaid expenses and other assets at September 30, 2022 and December 31, 2021 is approximately $1,849,000 and $1,819,000, respectively, held in escrow to fund future capital improvements.

Intangible assets on the acquisition of Mill Street Apartments are included in prepaid expenses and other assets. Intangible assets are approximately $7,000 net of accumulated amortization of approximately $1,411,000 and approximately $26,000 net of accumulated amortization of approximately $1,392,000 at September 30, 2022 and December 31, 2021, respectively.

Financing fees in association with the line of credit of approximately $124,000 and $169,000 are net of accumulated amortization of approximately $55,000 and $10,000 at September 30, 2022 and December 31, 2021 respectively.

XML

MORTGAGE NOTES PAYABLE

9 Months Ended

Sep. 30, 2022

MORTGAGE NOTES PAYABLE

MORTGAGE NOTES PAYABLE

NOTE 5. MORTGAGE NOTES PAYABLE

At September 30, 2022 and December 31, 2021, the mortgages payable consisted of various loans, all of which were secured by first mortgages on properties referred to in Note 2. At September 30, 2022, the interest rates on these loans ranged from 2.97% to 4.95%, payable in monthly installments aggregating approximately $1,471,000 including principal, to various dates through 2035. The majority of the mortgages are subject to prepayment penalties. At September 30, 2022, the weighted average interest rate on the above mortgages was 3.69%. The effective rate of 3.80% 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 $3,213,000 and $2,709,000 are net of accumulated amortization of approximately $948,000 and $1,139,000 at September 30, 2022 and December 31, 2021, respectively, which offset the total mortgage notes payable.

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

Approximate annual maturities at September 30, 2022 are as follows:

2023—current maturities	$	8,583,000
2024		2,749,000
2025		3,260,000
2026		25,209,000
2027		3,121,000
Thereafter		371,767,000
		414,689,000
Less: unamortized deferred financing costs		(3,213,000)
	$	411,476,000

On November 30, 2021, the Partnership entered into a Master Credit Facility Agreement (the “Facility Agreement”) with KeyBank National Association (“KeyBank”) dated as of November 30, 2021, with an initial advance

in the amount of $156,000,000. Interest only on the debt at a fixed interest rate of 2.97% is payable on a monthly basis through December 31, 2031.

On June 16, 2022, the Partnership entered into an amendment to the Facility Agreement. The additional advance under the Amended Agreement is in the amount of $80,284,000, at a fixed interest rate of 4.33%. The Partnership’s obligations under the Facility Agreement are secured by mortgages on certain properties pursuant to certain Mortgage, Assignment of Leases and Rents, and Security Agreement and Fixture Filings.

The Partnership used the proceeds to pay down approximately $37,065,000 of existing debt secured by four properties, along with approximately $854,000 in prepayment penalties. The remaining balance of approximately $42,384,000 will be used for general partnership purposes.

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. Prior to the line’s expiration in 2020, the Partnership exercised its option for a one-year extension until October 31, 2021. The Partnership paid an extension fee of approximately $37,500 in association with the extension.

On October 29, 2021, the Partnership closed on the modification of its existing line of credit. The agreement extends the credit line for three years until October 29, 2024. The commitment amount is for $25 million but is restricted to $17 million during the modification period. The modification period covers the current period and phases out by December 31, 2022. During this period, the loan covenants are modified from a minimum consolidated debt service ratio of 1.60 to a ratio of 1.35 until September 30, 2022; from a minimum tangible net worth requirement of $200 million to a net worth of $175 million until September 30, 2022; from a maximum consolidated leverage ratio of 65% to a ratio of 70% until September 30, 2022 and from a minimum debt yield of 9.5% to a yield of 8.5% until September 30, 2022 and a yield of 9.0% until December 31, 2022. Once the financial performance of the Partnership meets the original covenant tests for the trailing 12-month period, the commitment amount will return to $25 million. The portfolio’s debt yield fell below the minimum of 8.5% to 8.05%. As of September 30, 2022, the Partnership did not comply with the debt yield financial covenant. As such, the Partnership is unable to draw down any amount from the line of credit until the Partnership meets the required financial covenants.

The interest rate for the new term is LIBOR plus 300 basis points. The costs associated with the modification and renewal of the line of credit was approximately $179,000. On December 3, 2021, the Partnership paid off the outstanding balance of $17,000,000 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 dividends, make distributions or acquire equity interests of the Partnership.

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

XML

ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS

9 Months Ended

Sep. 30, 2022

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 September 30, 2022, amounts received for prepaid rents of approximately $2,581,000 are included in cash and cash equivalents, and security deposits of approximately $3,402,000 are included in prepaid expenses and other assets and are restricted cash.

XML

PARTNERS' CAPITAL

9 Months Ended

Sep. 30, 2022

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 distributions made to the total units outstanding. All classes have equal profit sharing and distribution rights, in proportion to their ownership interests.

In January 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on March 31, 2022. In addition to the quarterly distribution, there was a special distribution of $38.40 per Class A unit ($1.28 per Receipt) payable on March 31, 2022. In April 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on June 30, 2022. In July 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on September 30, 2022.

In 2021, regular quarterly distributions of $9.60 per unit ($0.32 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:

	Nine Months Ended
	September 30,
	2022		2021
Net Income per Depositary Receipt	$	0.44	$	0.05
Distributions per Depositary Receipt	$	2.24	$	0.96

XML

TREASURY UNITS

9 Months Ended

Sep. 30, 2022

TREASURY UNITS

TREASURY UNITS

NOTE 8. TREASURY UNITS

Treasury Units at September 30, 2022 are as follows:

Class A	48,721
Class B	11,571
General Partnership	609
	60,901

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. On March 9, 2020, the General Partner extended the program for an additional five years from March 31, 2020 to March 31, 2025. 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 Restated 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 September 30, 2022, the Partnership has repurchased 1,486,802 Depositary Receipts at an average price of $30.09 per receipt (or $902.70 per underlying Class A Unit), 4,034 Class B Units and 212 General Partnership Units, both at an average price of $1,179.00 per Unit, totaling approximately $50,336,000 including brokerage fees paid by the Partnership.

During the nine months ended September 30, 2022, the Partnership purchased a total of 52,613 Depositary Receipts. The average price was $78.53 per receipt or $2,355.90 per unit. The cost including commission was $4,134,773.The Partnership was required to repurchase 416.52 Class B Units and 21.92 General Partnership units at a cost of $981,249 and $51,645 respectively.

XML

COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2022

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.

XML

RENTAL INCOME

9 Months Ended

Sep. 30, 2022

RENTAL INCOME

RENTAL INCOME

NOTE 10. RENTAL INCOME

During the nine months ended September 30, 2022, approximately 95% 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 5% was related to commercial properties, which have minimum future annual rental income on non-cancellable operating leases at September 30, 2022 as follows:

	Commercial
	Property Leases
2023	$	1,981,000
2024		1,409,000
2025		871,000
2026		728,000
2027		406,000
Thereafter		1,683,000
	$	7,078,000

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 $441,000 and $417,000 for the nine months ended September 30, 2022 and 2021 respectively. Staples and Trader Joe’s, tenants at Staples Plaza, are approximately 28% 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 September 30,	expiring leases		for expiring leases	leases expiring	expiring leases
2023	$	430,143	55,286	22	19	%
2024		785,710	26,248	13	37	%
2025		135,210	2,461	4	6	%
2026		198,266	5,396	4	9	%
2027		269,210	11,716	5	12	%
2028		93,873	2,158	1	4	%
2029		181,324	5,104	2	8	%
2030		—	—	—	—	%
2031		—	—	—	—	%
Thereafter		118,245	—	1	5	%
Totals	$	2,211,981	108,369	52	100	%

Rents receivable are net of an allowance for doubtful accounts of approximately $824,000 and $832,000 at September 30, 2022 and December 31, 2021. Included in rents receivable at September 30, 2022 is approximately $76,000 resulting from recognizing rental income from non-cancelable commercial leases with future rental increases on a straight-line basis.

Rents receivable at September 30, 2022 also includes approximately $13,000 representing the deferral of rental concession primarily related to the residential properties.

XML

CASH FLOW INFORMATION

9 Months Ended

Sep. 30, 2022

CASH FLOW INFORMATION

CASH FLOW INFORMATION

NOTE 11. CASH FLOW INFORMATION

During the nine months ended September 30, 2022 and 2021, cash paid for interest was approximately $10,584,000, and $9,985,000 respectively. Cash paid for state income taxes was approximately $52,000 and $70,000 during the nine months ended September 30, 2022 and 2021 respectively. During the nine months ended September 30, 2022, four properties were involved in a non-cash financing activity of approximately $37,000,000.

XML

FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2022

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

NOTE 12. FAIR VALUE MEASUREMENTS

Fair Value Measurements on a Recurring Basis

At September 30, 2022 and December 31, 2021, 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 September 30, 2022 and December 31, 2021 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. The Company considers all highly liquid investments purchased with original maturities of three months or less at the time of purchase to be cash equivalents. Cash, cash equivalents, and restricted cash include cash held in checking, U.S. Treasury Bills, and money market accounts.

The Partnership has investments in Treasury Bills some of which mature over a period greater than 90 days and are classified as short-term investments. The Treasury Bills are carried at amortized cost and classified as held to maturity as the Partnership has the intent and the ability to hold them until they mature. The carrying value of the Treasury Bills are adjusted for accretion of discounts over the remaining life of the investment. Income related to the Treasury Bills is recognized in interest income in the Partnership’s consolidated statement of income. The Treasury Bills classified within Level I of the fair value hierarchy.

At September 30, 2022 and December 31, 2021 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 September 30, 2022 and December 31, 2021, 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.

		September 30, 2022				December 31, 2021
		Carrying Value		Fair Value		Carrying Value		Fair Value
Assets
Cash equivalents		$	59,473,939	$	59,529,805	$	96,083,508	$	96,083,508
Treasury bills		$	73,995,586	$	74,158,935	$	—	$	—
Total Assets		$	133,469,525	$	133,688,740	$	96,083,508	$	96,083,508
Liabilities
Mortgage payable
- Partnership properties	*	$	411,475,632	$	366,891,771	$	370,481,390	$	383,244,134
- Investment properties	*	$	166,119,958	$	155,922,343	$	166,203,705	$	175,881,762
Total Liabilities		$	577,595,590	$	522,814,114	$	536,685,095	$	559,125,896

* Net of unamortized deferred financing costs

Disclosure about fair value of financial instruments is based on pertinent information available to management as of September 30, 2022 and December 31, 2021. 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 September 30, 2022 and current estimates of fair value may differ significantly from the amounts presented herein.

XML

TAXABLE INCOME AND TAX BASIS

9 Months Ended

Sep. 30, 2022

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, different depreciation methods, different tax lives, other items with limited tax deductibility carryovers and timing differences related to prepaid rents, allowances and intangible assets at significant acquisitions. Federal taxable income of approximately $4,056,000 was approximately $6,756,000 more than statement income for the year ended December 31, 2021. The Federal cumulative tax basis of the Partnership’s real estate at December 31, 2021 is approximately $10,946,000 more 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 Federal tax basis in its joint venture investments is approximately $1,066,000 more than statement basis. State taxable income may be significantly different due to different tax treatments for certain items.

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 consolidated financial statements.

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 September 30, 2022, the tax years that generally remain subject to examination by the major tax jurisdictions under the statute of limitations is from the year 2018 forward.

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

9 Months Ended

Sep. 30, 2022

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

NOTE 14. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

The Partnership has invested in seven limited partnerships and limited liability companies, the majority of which have invested in residential apartment complexes, with three Joint Ventures investing in commercial property. The Partnership has between a 40%-50% ownership interests in each investment. The other investors are the Brown Family related entities and five current and former employees of the Management Company. The Brown Family’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 was to mature 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 , 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 are 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. At September 30, 2022, the balance on this mortgage before unamortized deferred financing costs is $125,000,000. This investment, Hamilton Park Towers, LLC is referred to as Dexter Park.

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 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. At September 30, 2022, the balance on this mortgage before unamortized deferred financing costs is $10,000,000. 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.

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. After paying off the mortgage, the Partnership began to

sell off the individual units. In 2019, all residential units were sold. The Partnership still owns the commercial building. 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. 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. 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. At September 30, 2022, the balance on this mortgage before unamortized deferred financing costs is $6,000,000. This investment is referred to as Hamilton Minuteman, LLC.

In August 2004, the Partnership invested $8,000,000 for a 50% ownership interest in a 280-unit apartment complex located in Watertown, Massachusetts. The total purchase price was $56,000,000. The Joint Venture sold 137 units as condominiums. The assets were combined with Hamilton on Main Apartments. Hamilton on Main, LLC is known as Hamilton Place. In 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. 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. At September 30, 2022, the balance of the mortgage before unamortized deferred finance is $16,900,000. The investment is referred to as Hamilton on Main LLC.

In November 2001, the Partnership invested approximately $1,533,000 for a 50% ownership interest in a 40-unit apartment building in Cambridge, Massachusetts. In June 2013, the property was refinanced with a 15 year mortgage in the amount of $10,000,000 at 3.87%, interest only for 3 years and is amortized on a 30-year schedule for the balance of the term. The Joint Venture paid off the prior mortgage of approximately $6,776,000 with the proceeds of the new mortgage. After the refinancing, the Joint Venture made a distribution of $1,610,000 to the Partnership. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. At September 30, 2022, the balance of this mortgage before unamortized deferred financing costs is approximately $8,770,000. This investment is referred to as 345 Franklin, LLC.

Summary financial information at September 30, 2022

				Hamilton									Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	5,935,095		$	2,586,302		$	4,852,841		$	79,107		$	4,551,023		$	13,688,356		$	76,657,705		$	108,350,429
Cash & Cash Equivalents		883,219			88,190			265,808			9,882			175,451			910,242			2,220,183			4,552,975
Rent Receivable		198,014			77,561			1,240			4,906			5,299			18,832			44,830			350,682
Real Estate Tax Escrow		74,625			—			69,748			—			32,497			105,494			—			282,364
Prepaid Expenses & Other Assets		321,917			56,261			117,224			757			28,665			224,845			2,298,375			3,048,044
Total Assets	$	7,412,870		$	2,808,314		$	5,306,861		$	94,652		$	4,792,935		$	14,947,769		$	81,221,093		$	116,584,494
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,958,633		$	—		$	8,731,598		$	—		$	5,926,689		$	16,869,235		$	124,633,803		$	166,119,958
Accounts Payable & Accrued Expense		120,784			2,250			92,492			2,553			59,237			163,200			756,960			1,197,476
Advance Rental Pmts & Security Deposits		332,572			19,865			280,818			—			161,741			430,923			2,837,995			4,063,914
Total Liabilities		10,411,989			22,115			9,104,908			2,553			6,147,667			17,463,358			128,228,758			171,381,348
Partners’ Capital		(2,999,119)			2,786,199			(3,798,047)			92,099			(1,354,732)			(2,515,589)			(47,007,665)			(54,796,854)
Total Liabilities and Capital	$	7,412,870		$	2,808,314		$	5,306,861		$	94,652		$	4,792,935		$	14,947,769		$	81,221,093		$	116,584,494
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,393,100		$	—		$	46,050		$	—		$	—		$	—			1,439,150
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,499,560)		$	—		$	(1,899,023)		$	—		$	(677,366)		$	(1,257,794)		$	(18,803,066)			(24,136,809)
Total Investment in Unconsolidated Joint Ventures (Net)																						$	(22,697,659)
Total units/condominiums
Apartments		48			—			40			175			42			148			409			687
Commercial		1			1			—			1			—			—			—			3
Total		49			1			40			176			42			148			409			690
Units to be retained		49			1			40			1			42			148			409			690
Units to be sold		—			—			—			—			—			—			—			—
Units sold through November 1, 2022		—			—			—			175			—			—			—			175
Unsold units		—			—			—			—			—			—			—			—

Financial information for the nine months ended September 30, 2022

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,194,570	$	235,842	$	1,107,677	$	77,935	$	899,186	$	2,725,431	$	11,014,528	$	17,255,169
Laundry and Sundry Income		9,839		—		120		—		472		25,402		73,452		109,285
		1,204,409		235,842		1,107,797		77,935		899,658		2,750,833		11,087,980		17,364,454
Expenses
Administrative		14,512		5,798		26,052		2,142		9,297		52,028		163,891		273,720
Depreciation and Amortization		358,568		8,782		259,967		2,448		253,369		808,116		2,813,436		4,504,686
Management Fees		58,716		9,879		43,719		3,166		35,967		108,615		230,937		490,999
Operating		169,086		—		54,901		1,219		95,538		282,757		853,728		1,457,229
Renting		23,823		—		27,857		—		8,988		39,844		85,229		185,741
Repairs and Maintenance		132,026		3,180		125,323		—		82,989		494,223		1,393,350		2,231,091
Taxes and Insurance		199,415		47,074		131,736		13,567		114,224		387,242		1,862,717		2,755,975
		956,146		74,713		669,555		22,542		600,372		2,172,825		7,403,288		11,899,441
Income Before Other Income		248,263		161,129		438,242		55,393		299,286		578,008		3,684,692		5,465,013
Other Income (Loss)
Interest Expense		(257,574)		—		(263,093)		—		(177,129)		(568,251)		(3,817,865)		(5,083,912)
		(257,574)		—		(263,093)		—		(177,129)		(568,251)		(3,817,865)		(5,083,912)
Net (Loss) Income	$	(9,311)	$	161,129	$	175,149	$	55,393	$	122,157	$	9,757	$	(133,173)	$	381,101
Net (Loss) Income —NERA 50%	$	(4,656)	$	80,565	$	87,575	$	27,697	$	61,078	$	4,879				257,136
Net Income —NERA 40%													$	(53,269)		(53,269)
															$	203,867

Financial information for the three months ended September 30, 2022

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	433,819	$	60,471	$	392,851	$	27,813	$	300,345	$	919,313	$	3,894,398	$	6,029,010
Laundry and Sundry Income		4,445		—		—		—		—		8,252		23,860		36,557
		438,264		60,471		392,851		27,813		300,345		927,565		3,918,258		6,065,567
Expenses
Administrative		5,640		4,250		6,060		793		3,542		16,448		54,159		90,892
Depreciation and Amortization		119,789		2,927		86,776		816		84,966		270,802		947,553		1,513,629
Management Fees		21,620		2,353		15,610		1,112		12,438		36,098		78,267		167,498
Operating		49,866		—		18,186		54		20,336		90,931		271,977		451,350
Renting		9,759		—		10,650		—		1,974		14,264		12,555		49,202
Repairs and Maintenance		62,158		—		41,565		—		37,999		188,269		595,679		925,670
Taxes and Insurance		66,313		15,566		44,269		4,448		38,546		125,879		642,107		937,128
		335,145		25,096		223,116		7,223		199,801		742,691		2,602,297		4,135,369
Income Before Other Income		103,119		35,375		169,735		20,590		100,544		184,874		1,315,961		1,930,198
Other Income (Loss)
Interest Expense		(116,185)		—		(86,694)		—		(59,000)		(191,453)		(1,283,295)		(1,736,627)
		(116,185)		—		(86,694)		—		(59,000)		(191,453)		(1,283,295)		(1,736,627)
Net Income (Loss)	$	(13,066)	$	35,375	$	83,041	$	20,590	$	41,544	$	(6,579)	$	32,666	$	193,571
Net Income (Loss)—NERA 50%	$	(6,534)	$	17,688	$	41,520	$	10,295	$	20,771	$	(3,289)				80,451
Net Income —NERA 40%													$	13,065		13,065
															$	93,516

Future annual mortgage maturities at September 30, 2022 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
9/30/2023	$	—	$	228,573	$	—	$	—	$	—	$	228,573
9/30/2024		—		237,577		—		16,900,000		—		17,137,577
9/30/2025		10,000,000		246,936		—		—		—		10,246,936
9/30/2026		—		256,664		—		—		—		256,664
9/30/2027		—		266,775		—		—		—		266,775
Thereafter		—		7,533,358		6,000,000		—		125,000,000		138,533,358
		10,000,000		8,769,883		6,000,000		16,900,000		125,000,000		166,669,883
Less: unamortized deferred financing costs		(41,367)		(38,286)		(73,311)		(30,765)		(366,196)		(549,925)
	$	9,958,633	$	8,731,597	$	5,926,689	$	16,869,235	$	124,633,804	$	166,119,958

At September 30, 2022 the weighted average interest rate on the above mortgages was 4.05%. The effective rate was 4.12% including the amortization expense of deferred financing costs.

Summary financial information at September 30, 2021

				Hamilton									Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	6,376,891		$	2,588,792		$	5,139,866		$	82,371		$	4,766,334		$	14,522,033		$	79,175,187		$	112,651,474
Cash & Cash Equivalents		230,394			73,049			154,633			9,776			231,357			602,344			2,135,096			3,436,649
Rent Receivable		65,313			13,744			23,113			7,081			7,285			38,832			236,721			392,089
Real Estate Tax Escrow		77,685			—			62,506			—			40,025			117,318			—			297,534
Prepaid Expenses & Other Assets		311,513			67,410			123,115			685			30,592			195,099			1,956,585			2,684,999
Total Assets	$	7,061,796		$	2,742,995		$	5,503,233		$	99,913		$	5,075,593		$	15,475,626		$	83,503,589		$	119,462,745
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,944,844		$	—		$	8,944,849		$	—		$	5,918,506		$	16,853,184		$	124,569,180		$	166,230,563
Accounts Payable & Accrued Expense		82,137			2,250			99,583			2,711			67,629			169,515			804,862			1,228,687
Advance Rental Pmts& Security Deposits		189,746			—			247,951			—			154,400			474,463			2,427,394			3,493,954
Total Liabilities		10,216,727			2,250			9,292,383			2,711			6,140,535			17,497,162			127,801,436			170,953,204
Partners’ Capital		(3,154,931)			2,740,745			(3,789,150)			97,202			(1,064,942)			(2,021,536)			(44,297,847)			(51,490,459)
Total Liabilities and Capital	$	7,061,796		$	2,742,995		$	5,503,233		$	99,913			5,075,593		$	15,475,626		$	83,503,589		$	119,462,745
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,370,373		$	—		$	48,601		$			$			$			$	1,418,974
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,577,467)		$	—		$	(1,894,576)		$	—		$	(532,472)		$	(1,010,769)		$	(17,719,140)			(22,734,423)
Total Investment in Unconsolidated Joint Ventures (Net)																						$	(21,315,449)
Total units/condominiums
Apartments		48			—			40			175			42			148			409			862
Commercial		1			1			—			1			—			—			—			3
Total		49			1			40			176			42			148			409			865
Units to be retained		49			1			40			1			42			148			409			690
Units sold through November 1, 2021		—			—			—			175			—			—			—			175
Unsold units		—			—			—			—			—			—			—			—

Financial information for the nine months ended September 30, 2021

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	856,569	$	168,431	$	1,019,465	$	75,148	$	865,196	$	2,491,414	$	9,513,069	$	14,989,292
Laundry and Sundry Income		9,194		—		112		—		4,548		27,837		73,067		114,758
		865,763		168,431		1,019,577		75,148		869,744		2,519,251		9,586,136		15,104,050
Expenses
Administrative		70,445		2,103		22,651		2,140		11,485		49,372		160,336		318,532
Depreciation and Amortization		358,788		15,223		257,314		2,448		253,180		813,435		2,795,700		4,496,088
Management Fees		29,181		6,187		40,288		2,843		34,592		97,262		202,975		413,328
Operating		129,400		—		42,137		231		78,038		315,638		761,854		1,327,298
Renting		81,149		—		46,108		—		1,095		71,772		415,221		615,345
Repairs and Maintenance		123,467		520		100,182		—		86,566		446,677		1,506,426		2,263,838
Taxes and Insurance		195,974		45,037		131,574		14,535		107,198		336,333		1,812,549		2,643,200
		988,404		69,070		640,254		22,197		572,154		2,130,489		7,655,061		12,077,629
Income Before Other Income		(122,641)		99,361		379,323		52,951		297,590		388,762		1,931,075		3,026,421
Other Income (Loss)
Interest Expense		(184,542)		—		(269,993)		—		(177,757)		(568,246)		(3,792,615)		(4,993,153)
Other (Loss)
Other Income		—		—		—				—		—		1,222		1,222
		(184,542)		—		(269,993)		—		(177,757)		(568,246)		(3,791,393)		(4,991,931)
Net Income (Loss)	$	(307,183)	$	99,361	$	109,330	$	52,951	$	119,833	$	(179,484)	$	(1,860,318)	$	(1,965,510)
Net Income (Loss)—NERA 50%	$	(153,593)	$	49,681	$	54,665	$	26,476	$	59,917	$	(89,742)				(52,597)
Net Income —NERA 40%													$	(744,128)		(744,128)
															$	(796,725)

Financial information for the three months ended September 30, 2021

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	414,497	$	111,191	$	343,674	$	26,410	$	293,988	$	827,140	$	3,300,261	$	5,317,161
Laundry and Sundry Income		2,986		—		—		—		1,243		9,796		23,706		37,731
		417,483		111,191		343,674		26,410		295,231		836,936		3,323,967		5,354,892
Expenses
Administrative		16,576		750		7,129		651		3,824		14,592		65,606		109,128
Depreciation and Amortization		120,266		5,074		86,449		816		84,827		272,874		938,058		1,508,364
Management Fees		17,335		6,187		13,943		1,272		11,716		32,831		73,512		156,796
Operating		60,232		—		16,060		55		23,542		101,948		260,794		462,631
Renting		26,272		—		12,174		—		375		20,213		222,664		281,698
Repairs and Maintenance		41,335		—		35,687		—		30,184		177,652		599,156		884,014
Taxes and Insurance		64,799		15,228		44,194		4,634		36,986		115,028		614,622		895,491
		346,815		27,239		215,636		7,428		191,454		735,138		2,774,412		4,298,122
Income Before Other Income		70,668		83,952		128,038		18,982		103,777		101,798		549,555		1,056,770
Other Income (Loss)
Interest Expense		(61,827)		—		(89,248)		—		(59,880)		(191,453)		(1,263,383)		(1,665,791)
Other Income		—		—		—		—		—		—				—
		(61,827)		—		(89,248)		—		(59,880)		(191,453)		(1,263,383)		(1,665,791)
Net Income (Loss)	$	8,841	$	83,952	$	38,790	$	18,982	$	43,897	$	(89,655)	$	(713,828)	$	(609,021)
Net Income (Loss)—NERA 50%	$	4,421	$	41,976	$	19,395	$	9,491	$	21,949	$	(44,829)				52,403
Net Income —NERA 40%													$	(285,533)		(285,533)
															$	(233,130)

XML

EMPLOYEE BENEFIT 401(k) PLANS

9 Months Ended

Sep. 30, 2022

EMPLOYEE BENEFIT 401(k) PLANS

EMPLOYEE BENEFIT 401(k) PLANS

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 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 nine months ended September 30, 2022 was $70,000.

XML

IMPACT OF RECENTLY-ISSUED ACCOUNTING STANDARDS

9 Months Ended

Sep. 30, 2022

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.

XML

SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2022

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

NOTE 17. SUBSEQUENT EVENTS

From October 1, 2022, through January 19, 2023, the Partnership has purchased 1,658 Depository Receipts. The average price was $76.58 per receipt, or $2,297.40 per unit. The total cost was $127,565. The Partnership is required to purchase 13 Class B units and 1 General Partnership units at a cost of $30,154 and $1,587, respectively.

On October 3, 2022, the Management Company was the target of a ransomware attack. The Management Company has been engaged by the General Partner, to perform general management functions for the Company’s properties in exchange for management fees. After becoming aware of the incident, the Management Company conducted an initial investigation into their digital environment and discovered that all on premise computer systems were encrypted. The Management Company worked with independent third-party cybersecurity specialists through its outside counsel to help with the restoration of the environment and to return operations securely. Hamilton maintains off-site data backups, which were verified to have not been compromised by the ransomware attack and were utilized to restore the data that had been encrypted. The Management Company has successfully recovered the impacted files and rebuilt its computer systems, adding additional security features designed to protect its systems and data from future attacks. This incident was previously reported in the Company’s Current Report on Form 8-K filed with the SEC on October 11, 2022.

On October 14, 2022, the Partnership entered into a modification agreement with Brookline Bank modifying its loan on 659-665 Worcester Road, Framingham, MA. The agreement modifies the loan on the existing debt of $5,954,546.14, extending the maturity until October 14, 2032, at an interest rate of 4.6%, interest only for 2 years and amortizing using a thirty-year schedule for the balance of the term.  The agreement also allows for an earn out of up to an additional $1,495,453.86 once the property performance reaches a 1.35x debt service coverage ratio and the loan to value equates to at least 65%.

On November 15, 2022, (the Partnership received a notification letter from the Corporate Compliance Department of the NYSE American Exchange (the “NYSE American”) indicating that as of November 15, 2022, the Partnership is not in compliance with the NYSE American’s standards for continued listing of the Partnership’s Depositary Receipts on the NYSE American as set forth in Section 1007 of the NYSE American Company Guide (the “Company Guide”). The Partnership failed to timely file (the “Filing Delinquency”) the Partnership’s Form 10-Q for the quarter ended September 30, 2022 (the “Delayed Report”). The NYSE American notification letter has no immediate effect on the listing or trading of the Partnership’s Depositary Receipts on the NYSE American, nor will it have any effect on the Partnership's financial condition or results of operations.  The Filing Delinquency is the result of the above-mentioned cybersecurity incident and was previously reported in the Partnership’s Current Report on Form 8-K filed with the SEC on November 21, 2022. The Filing Delinquency will be cured via the filing of the Delayed Report, which is this Form 10-Q.

In November 2022, the Partnership approved a quarterly distribution of $9.60 per Unit ($0.32 per Receipt), payable on December 31, 2022.

On December 5, 2022, Andrew Bloch, the Chief Financial Officer (“CFO”) of the Management Company, which has been engaged by the Partnership to manage the properties of the Partnership, resigned as Chief Financial Officer. Mr. Bloch will continue to work with Hamilton on a consultative basis to ensure a smooth transition of responsibilities to the new CFO. Mr. Bloch remains a director of the General Partner, and of the Management Company. Mr. Bloch’s decision to resign as CFO is not the result of any disagreement with the Partnership on any matter relating to the Partnership’s operations, policies, or practices. Mr. Bloch has served as CFO of the Management Company since 1998.

Effective as of December 5, 2022, the Board of Directors of the Management Company elected Karen N. Zermani as CFO of the Management Company to fill the vacancy created by the resignation of Mr. Bloch as CFO.

On December 12, 2022, the Partnership signed a purchase and sale agreement to purchase a commercial retail property of approximately 20,700 square feet, located at 659 Worcester Road in Framingham, Massachusetts for the sum of approximately $10,151,000. The Partnership has made a deposit of $500,000 to secure the transaction. This acquisition will be funded from the Partnership’s cash reserves. The Partnership closed on the transaction on January 18,2023.

On December 19, 2022, a class action was commenced in the United States District Court for the District of Massachusetts against a number of parties, including the Company:  Billie Jo White v. RealPage, Inc., et al, Case No. 1:22-cv-12134, United States District Court, District of Massachusetts (“RealPage Litigation”).

The first named defendant, RealPage, Inc., is allegedly the developer of a certain software platform known as “AI Revenue Management” (previously known as “YieldStar”).  In addition to RealPage, the Complaint names as defendants several companies, including the Company, allegedly owning, operating and/or managing residential real estate in the Greater Boston Metro Area (collectively, “Defendant Property Managers”).  The Complaint alleges that through the combined use of RealPage’s revenue management services, which allegedly included collecting non-public data regarding various factors influencing rents and generating a suggested rental price for each of the units controlled by a Defendant Property Manager using its services, the Defendant Property Managers constitute a rental “price-fixing cartel” in violation of federal and state anti-trust laws.  The Complaint seeks class certification and unspecified damages, trebled, together with attorney’s fees and other injunctive relief.  No class has yet been certified.

The Company disputes the allegations made against it and intends to vigorously defend the lawsuit.

The named Defendant Property Managers are the following:  Greystar Real Estate Partners, LLC; Cushman & Wakefield, Inc.; Lincoln Property Company; Peabody Properties, Inc.; New England Realty Associates Limited Partnership; WinnCompanies LLC and WinnResidential Manager Corp., UDR, Inc., SHP Management Corp., The Related Companies, Inc. and Simpson Property Group, LLLP.

XML

SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2022

SIGNIFICANT ACCOUNTING POLICIES

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 seven 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. Revenue from commercial leases also include reimbursements and recoveries 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 amounts are accounted for 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

The Partnership evaluates the non-lease components (lease arrangements that include common area maintenance services) with related lease components (lease revenues). If both the timing and pattern of transfer are the same for the non-lease component and related lease component, the lease component is the predominant component. The Partnership elected an allowed practical expedient. For (i) operating lease arrangements involving real estate that include common area maintenance services and (ii) all real estate arrangements that include real estate taxes and insurance costs, we present these amounts within lease revenues in our consolidated statements of income. We record amounts reimbursed by the lessee in the period in which the applicable expenses are incurred.

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 $350,000 and $180,000 for the nine months ended September 30, 2022 and 2021, 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 at the time of purchase.

Investments in Treasury Bills

Investments in Treasury Bills: Investments in Treasury Bills are recorded at amortized cost and classified as held to maturity as the Partnership has the intent and the ability to hold them until they mature. The carrying value of the Treasury Bills are adjusted for accretion of discounts over the remaining life of the investment. Income related to the Treasury Bills is recognized in interest income in the Partnership’s consolidated statement of income.

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 2022 or 2021 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 2022 or 2021. The Partnership makes its temporary cash investments with high-credit quality financial institutions. At September 30, 2022, substantially all of the Partnership’s cash and cash equivalents were held in interest-bearing accounts at financial institutions, and investments in U.S. Treasury bills, earning interest at rates from 0.01% to 2.19%. At September 30, 2022 and December 31, 2021, respectively approximately $45,045,000, and $96,166,000 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 $190,316 and $240,814 for the nine months ended September 30, 2022, and 2021, respectively.

Rental Property Held for Sale

Rental Property Held 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.

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 nine months ended September 30, 2022, and 2021 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 refinancings qualify as extinguishment of debt.

Reclassifications

Reclassification: Certain reclassifications have been made to prior period amounts in order to conform to current period presentation.

XML

RENTAL PROPERTIES (Tables)

9 Months Ended

Sep. 30, 2022

RENTAL PROPERTIES

Schedule of rental properties

	September 30, 2022		December 31, 2021		Useful Life
Land, improvements and parking lots	$	87,506,136	$	86,887,276	15	-	40	years
Buildings and improvements		254,618,756		253,952,680	15	-	40	years
Kitchen cabinets		17,384,297		16,946,916	5	-	10	years
Carpets		12,751,418		12,029,577	5	-	10	years
Air conditioning		501,697		501,697	5	-	10	years
Laundry equipment		613,961		608,271	5	-	7	years
Elevators		1,885,265		1,885,265	20	-	40	years
Swimming pools		1,090,604		1,090,604	10	-	30	years
Equipment		18,767,307		18,072,761	5	-	30	years
Motor vehicles		171,519		171,519			5	years
Fences		46,872		46,872	5	-	15	years
Furniture and fixtures		8,462,476		7,898,163	5	-	7	years
Smoke alarms		496,641		496,641	5	-	7	years
Total fixed assets		404,296,949		400,588,242
Less: Accumulated depreciation		(161,359,023)		(149,233,040)
	$	242,937,926	$	251,355,202

XML

MORTGAGE NOTES PAYABLE (Tables)

9 Months Ended

Sep. 30, 2022

MORTGAGE NOTES PAYABLE

Schedule of approximate annual maturities

Approximate annual maturities at September 30, 2022 are as follows:

2023—current maturities	$	8,583,000
2024		2,749,000
2025		3,260,000
2026		25,209,000
2027		3,121,000
Thereafter		371,767,000
		414,689,000
Less: unamortized deferred financing costs		(3,213,000)
	$	411,476,000

XML

PARTNERS' CAPITAL (Tables)

9 Months Ended

Sep. 30, 2022

PARTNERS' CAPITAL

Schedule of information per depositary receipt

	Nine Months Ended
	September 30,
	2022		2021
Net Income per Depositary Receipt	$	0.44	$	0.05
Distributions per Depositary Receipt	$	2.24	$	0.96

XML

TREASURY UNITS (Tables)

9 Months Ended

Sep. 30, 2022

TREASURY UNITS

Schedule of treasury units

Treasury Units at September 30, 2022 are as follows:

Class A	48,721
Class B	11,571
General Partnership	609
	60,901

XML

RENTAL INCOME (Tables)

9 Months Ended

Sep. 30, 2022

RENTAL INCOME

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

	Commercial
	Property Leases
2023	$	1,981,000
2024		1,409,000
2025		871,000
2026		728,000
2027		406,000
Thereafter		1,683,000
	$	7,078,000

Schedule of information for commercial leases

	Annual base				Percentage of
	rent for		Total square feet	Total number of	annual base rent for
Through September 30,	expiring leases		for expiring leases	leases expiring	expiring leases
2023	$	430,143	55,286	22	19	%
2024		785,710	26,248	13	37	%
2025		135,210	2,461	4	6	%
2026		198,266	5,396	4	9	%
2027		269,210	11,716	5	12	%
2028		93,873	2,158	1	4	%
2029		181,324	5,104	2	8	%
2030		—	—	—	—	%
2031		—	—	—	—	%
Thereafter		118,245	—	1	5	%
Totals	$	2,211,981	108,369	52	100	%

XML

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2022

FAIR VALUE MEASUREMENTS

Schedule of carrying amounts and estimated fair value of debt

		September 30, 2022				December 31, 2021
		Carrying Value		Fair Value		Carrying Value		Fair Value
Assets
Cash equivalents		$	59,473,939	$	59,529,805	$	96,083,508	$	96,083,508
Treasury bills		$	73,995,586	$	74,158,935	$	—	$	—
Total Assets		$	133,469,525	$	133,688,740	$	96,083,508	$	96,083,508
Liabilities
Mortgage payable
- Partnership properties	*	$	411,475,632	$	366,891,771	$	370,481,390	$	383,244,134
- Investment properties	*	$	166,119,958	$	155,922,343	$	166,203,705	$	175,881,762
Total Liabilities		$	577,595,590	$	522,814,114	$	536,685,095	$	559,125,896

* Net of unamortized deferred financing costs

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Tables)

9 Months Ended

Sep. 30, 2022

Schedule of future annual mortgage maturities

Future annual mortgage maturities at September 30, 2022 are as follows:

	Hamilton		345		Hamilton		Hamilton on		Dexter
Period End	Essex 81		Franklin		Minuteman		Main Apts		Park		Total
9/30/2023	$	—	$	228,573	$	—	$	—	$	—	$	228,573
9/30/2024		—		237,577		—		16,900,000		—		17,137,577
9/30/2025		10,000,000		246,936		—		—		—		10,246,936
9/30/2026		—		256,664		—		—		—		256,664
9/30/2027		—		266,775		—		—		—		266,775
Thereafter		—		7,533,358		6,000,000		—		125,000,000		138,533,358
		10,000,000		8,769,883		6,000,000		16,900,000		125,000,000		166,669,883
Less: unamortized deferred financing costs		(41,367)		(38,286)		(73,311)		(30,765)		(366,196)		(549,925)
	$	9,958,633	$	8,731,597	$	5,926,689	$	16,869,235	$	124,633,804	$	166,119,958

2022

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

Summary financial information at September 30, 2022

				Hamilton									Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	5,935,095		$	2,586,302		$	4,852,841		$	79,107		$	4,551,023		$	13,688,356		$	76,657,705		$	108,350,429
Cash & Cash Equivalents		883,219			88,190			265,808			9,882			175,451			910,242			2,220,183			4,552,975
Rent Receivable		198,014			77,561			1,240			4,906			5,299			18,832			44,830			350,682
Real Estate Tax Escrow		74,625			—			69,748			—			32,497			105,494			—			282,364
Prepaid Expenses & Other Assets		321,917			56,261			117,224			757			28,665			224,845			2,298,375			3,048,044
Total Assets	$	7,412,870		$	2,808,314		$	5,306,861		$	94,652		$	4,792,935		$	14,947,769		$	81,221,093		$	116,584,494
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,958,633		$	—		$	8,731,598		$	—		$	5,926,689		$	16,869,235		$	124,633,803		$	166,119,958
Accounts Payable & Accrued Expense		120,784			2,250			92,492			2,553			59,237			163,200			756,960			1,197,476
Advance Rental Pmts & Security Deposits		332,572			19,865			280,818			—			161,741			430,923			2,837,995			4,063,914
Total Liabilities		10,411,989			22,115			9,104,908			2,553			6,147,667			17,463,358			128,228,758			171,381,348
Partners’ Capital		(2,999,119)			2,786,199			(3,798,047)			92,099			(1,354,732)			(2,515,589)			(47,007,665)			(54,796,854)
Total Liabilities and Capital	$	7,412,870		$	2,808,314		$	5,306,861		$	94,652		$	4,792,935		$	14,947,769		$	81,221,093		$	116,584,494
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,393,100		$	—		$	46,050		$	—		$	—		$	—			1,439,150
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,499,560)		$	—		$	(1,899,023)		$	—		$	(677,366)		$	(1,257,794)		$	(18,803,066)			(24,136,809)
Total Investment in Unconsolidated Joint Ventures (Net)																						$	(22,697,659)
Total units/condominiums
Apartments		48			—			40			175			42			148			409			687
Commercial		1			1			—			1			—			—			—			3
Total		49			1			40			176			42			148			409			690
Units to be retained		49			1			40			1			42			148			409			690
Units to be sold		—			—			—			—			—			—			—			—
Units sold through November 1, 2022		—			—			—			175			—			—			—			175
Unsold units		—			—			—			—			—			—			—			—

Financial information for the nine months ended September 30, 2022

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	1,194,570	$	235,842	$	1,107,677	$	77,935	$	899,186	$	2,725,431	$	11,014,528	$	17,255,169
Laundry and Sundry Income		9,839		—		120		—		472		25,402		73,452		109,285
		1,204,409		235,842		1,107,797		77,935		899,658		2,750,833		11,087,980		17,364,454
Expenses
Administrative		14,512		5,798		26,052		2,142		9,297		52,028		163,891		273,720
Depreciation and Amortization		358,568		8,782		259,967		2,448		253,369		808,116		2,813,436		4,504,686
Management Fees		58,716		9,879		43,719		3,166		35,967		108,615		230,937		490,999
Operating		169,086		—		54,901		1,219		95,538		282,757		853,728		1,457,229
Renting		23,823		—		27,857		—		8,988		39,844		85,229		185,741
Repairs and Maintenance		132,026		3,180		125,323		—		82,989		494,223		1,393,350		2,231,091
Taxes and Insurance		199,415		47,074		131,736		13,567		114,224		387,242		1,862,717		2,755,975
		956,146		74,713		669,555		22,542		600,372		2,172,825		7,403,288		11,899,441
Income Before Other Income		248,263		161,129		438,242		55,393		299,286		578,008		3,684,692		5,465,013
Other Income (Loss)
Interest Expense		(257,574)		—		(263,093)		—		(177,129)		(568,251)		(3,817,865)		(5,083,912)
		(257,574)		—		(263,093)		—		(177,129)		(568,251)		(3,817,865)		(5,083,912)
Net (Loss) Income	$	(9,311)	$	161,129	$	175,149	$	55,393	$	122,157	$	9,757	$	(133,173)	$	381,101
Net (Loss) Income —NERA 50%	$	(4,656)	$	80,565	$	87,575	$	27,697	$	61,078	$	4,879				257,136
Net Income —NERA 40%													$	(53,269)		(53,269)
															$	203,867

Financial information for the three months ended September 30, 2022

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	433,819	$	60,471	$	392,851	$	27,813	$	300,345	$	919,313	$	3,894,398	$	6,029,010
Laundry and Sundry Income		4,445		—		—		—		—		8,252		23,860		36,557
		438,264		60,471		392,851		27,813		300,345		927,565		3,918,258		6,065,567
Expenses
Administrative		5,640		4,250		6,060		793		3,542		16,448		54,159		90,892
Depreciation and Amortization		119,789		2,927		86,776		816		84,966		270,802		947,553		1,513,629
Management Fees		21,620		2,353		15,610		1,112		12,438		36,098		78,267		167,498
Operating		49,866		—		18,186		54		20,336		90,931		271,977		451,350
Renting		9,759		—		10,650		—		1,974		14,264		12,555		49,202
Repairs and Maintenance		62,158		—		41,565		—		37,999		188,269		595,679		925,670
Taxes and Insurance		66,313		15,566		44,269		4,448		38,546		125,879		642,107		937,128
		335,145		25,096		223,116		7,223		199,801		742,691		2,602,297		4,135,369
Income Before Other Income		103,119		35,375		169,735		20,590		100,544		184,874		1,315,961		1,930,198
Other Income (Loss)
Interest Expense		(116,185)		—		(86,694)		—		(59,000)		(191,453)		(1,283,295)		(1,736,627)
		(116,185)		—		(86,694)		—		(59,000)		(191,453)		(1,283,295)		(1,736,627)
Net Income (Loss)	$	(13,066)	$	35,375	$	83,041	$	20,590	$	41,544	$	(6,579)	$	32,666	$	193,571
Net Income (Loss)—NERA 50%	$	(6,534)	$	17,688	$	41,520	$	10,295	$	20,771	$	(3,289)				80,451
Net Income —NERA 40%													$	13,065		13,065
															$	93,516

2021

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

				Hamilton									Hamilton			Hamilton
	Hamilton			Essex			345			Hamilton			Minuteman			on Main			Dexter
	Essex 81			Development			Franklin			1025			Apts			Apts			Park			Total
ASSETS
Rental Properties	$	6,376,891		$	2,588,792		$	5,139,866		$	82,371		$	4,766,334		$	14,522,033		$	79,175,187		$	112,651,474
Cash & Cash Equivalents		230,394			73,049			154,633			9,776			231,357			602,344			2,135,096			3,436,649
Rent Receivable		65,313			13,744			23,113			7,081			7,285			38,832			236,721			392,089
Real Estate Tax Escrow		77,685			—			62,506			—			40,025			117,318			—			297,534
Prepaid Expenses & Other Assets		311,513			67,410			123,115			685			30,592			195,099			1,956,585			2,684,999
Total Assets	$	7,061,796		$	2,742,995		$	5,503,233		$	99,913		$	5,075,593		$	15,475,626		$	83,503,589		$	119,462,745
LIABILITIES AND PARTNERS’ CAPITAL
Mortgage Notes Payable	$	9,944,844		$	—		$	8,944,849		$	—		$	5,918,506		$	16,853,184		$	124,569,180		$	166,230,563
Accounts Payable & Accrued Expense		82,137			2,250			99,583			2,711			67,629			169,515			804,862			1,228,687
Advance Rental Pmts& Security Deposits		189,746			—			247,951			—			154,400			474,463			2,427,394			3,493,954
Total Liabilities		10,216,727			2,250			9,292,383			2,711			6,140,535			17,497,162			127,801,436			170,953,204
Partners’ Capital		(3,154,931)			2,740,745			(3,789,150)			97,202			(1,064,942)			(2,021,536)			(44,297,847)			(51,490,459)
Total Liabilities and Capital	$	7,061,796		$	2,742,995		$	5,503,233		$	99,913			5,075,593		$	15,475,626		$	83,503,589		$	119,462,745
Partners’ Capital %—NERA		50	%		50	%		50	%		50	%		50	%		50	%		40	%
Investment in Unconsolidated Joint Ventures	$	—		$	1,370,373		$	—		$	48,601		$			$			$			$	1,418,974
Distribution and Loss in Excess of investments in Unconsolidated Joint Ventures	$	(1,577,467)		$	—		$	(1,894,576)		$	—		$	(532,472)		$	(1,010,769)		$	(17,719,140)			(22,734,423)
Total Investment in Unconsolidated Joint Ventures (Net)																						$	(21,315,449)
Total units/condominiums
Apartments		48			—			40			175			42			148			409			862
Commercial		1			1			—			1			—			—			—			3
Total		49			1			40			176			42			148			409			865
Units to be retained		49			1			40			1			42			148			409			690
Units sold through November 1, 2021		—			—			—			175			—			—			—			175
Unsold units		—			—			—			—			—			—			—			—

Financial information for the nine months ended September 30, 2021

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	856,569	$	168,431	$	1,019,465	$	75,148	$	865,196	$	2,491,414	$	9,513,069	$	14,989,292
Laundry and Sundry Income		9,194		—		112		—		4,548		27,837		73,067		114,758
		865,763		168,431		1,019,577		75,148		869,744		2,519,251		9,586,136		15,104,050
Expenses
Administrative		70,445		2,103		22,651		2,140		11,485		49,372		160,336		318,532
Depreciation and Amortization		358,788		15,223		257,314		2,448		253,180		813,435		2,795,700		4,496,088
Management Fees		29,181		6,187		40,288		2,843		34,592		97,262		202,975		413,328
Operating		129,400		—		42,137		231		78,038		315,638		761,854		1,327,298
Renting		81,149		—		46,108		—		1,095		71,772		415,221		615,345
Repairs and Maintenance		123,467		520		100,182		—		86,566		446,677		1,506,426		2,263,838
Taxes and Insurance		195,974		45,037		131,574		14,535		107,198		336,333		1,812,549		2,643,200
		988,404		69,070		640,254		22,197		572,154		2,130,489		7,655,061		12,077,629
Income Before Other Income		(122,641)		99,361		379,323		52,951		297,590		388,762		1,931,075		3,026,421
Other Income (Loss)
Interest Expense		(184,542)		—		(269,993)		—		(177,757)		(568,246)		(3,792,615)		(4,993,153)
Other (Loss)
Other Income		—		—		—				—		—		1,222		1,222
		(184,542)		—		(269,993)		—		(177,757)		(568,246)		(3,791,393)		(4,991,931)
Net Income (Loss)	$	(307,183)	$	99,361	$	109,330	$	52,951	$	119,833	$	(179,484)	$	(1,860,318)	$	(1,965,510)
Net Income (Loss)—NERA 50%	$	(153,593)	$	49,681	$	54,665	$	26,476	$	59,917	$	(89,742)				(52,597)
Net Income —NERA 40%													$	(744,128)		(744,128)
															$	(796,725)

Financial information for the three months ended September 30, 2021

			Hamilton						Hamilton		Hamilton
	Hamilton		Essex		345		Hamilton		Minuteman		on Main		Dexter
	Essex 81		Development		Franklin		1025		Apts		Apts		Park		Total
Revenues
Rental Income	$	414,497	$	111,191	$	343,674	$	26,410	$	293,988	$	827,140	$	3,300,261	$	5,317,161
Laundry and Sundry Income		2,986		—		—		—		1,243		9,796		23,706		37,731
		417,483		111,191		343,674		26,410		295,231		836,936		3,323,967		5,354,892
Expenses
Administrative		16,576		750		7,129		651		3,824		14,592		65,606		109,128
Depreciation and Amortization		120,266		5,074		86,449		816		84,827		272,874		938,058		1,508,364
Management Fees		17,335		6,187		13,943		1,272		11,716		32,831		73,512		156,796
Operating		60,232		—		16,060		55		23,542		101,948		260,794		462,631
Renting		26,272		—		12,174		—		375		20,213		222,664		281,698
Repairs and Maintenance		41,335		—		35,687		—		30,184		177,652		599,156		884,014
Taxes and Insurance		64,799		15,228		44,194		4,634		36,986		115,028		614,622		895,491
		346,815		27,239		215,636		7,428		191,454		735,138		2,774,412		4,298,122
Income Before Other Income		70,668		83,952		128,038		18,982		103,777		101,798		549,555		1,056,770
Other Income (Loss)
Interest Expense		(61,827)		—		(89,248)		—		(59,880)		(191,453)		(1,263,383)		(1,665,791)
Other Income		—		—		—		—		—		—				—
		(61,827)		—		(89,248)		—		(59,880)		(191,453)		(1,263,383)		(1,665,791)
Net Income (Loss)	$	8,841	$	83,952	$	38,790	$	18,982	$	43,897	$	(89,655)	$	(713,828)	$	(609,021)
Net Income (Loss)—NERA 50%	$	4,421	$	41,976	$	19,395	$	9,491	$	21,949	$	(44,829)				52,403
Net Income —NERA 40%													$	(285,533)		(285,533)
															$	(233,130)

XML

SIGNIFICANT ACCOUNTING POLICIES (Business) (Details)	Sep. 30, 2022 ft² item property	Sep. 30, 2021 property
Residential and mixed-use properties
Line of Business
Number of Real Estate Properties	25
Number of units	2,892
Condominium
Line of Business
Number of units	19
Wholly owned properties
Line of Business
Number of Real Estate Properties	29
Wholly owned properties | Residential buildings
Line of Business
Number of Real Estate Properties	21
Number of units	2,892
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	7
Number of units	688
Area of property (in square feet) | ft²	12,500
Partially owned properties | Car parking lot
Line of Business
Capacity of real estate property (in cars per lot)	50
Limited Partnerships | Partially owned properties | Residential and mixed-use properties
Line of Business
Number of Real Estate Properties	7
NERA 40%
Line of Business
Ownership interest (as a percent)	40.00%
NERA 40% | Residential and mixed-use properties
Line of Business
Ownership interest (as a percent)	40.00%
NERA 50%
Line of Business
Ownership interest (as a percent)	50.00%
NERA 50% | Residential and mixed-use properties
Line of Business
Ownership interest (as a percent)	50.00%
Investment Properties
Line of Business
Number of units | property	690	865
Investment Properties | Residential buildings
Line of Business
Number of units | property	687	862
Investment Properties | Commercial
Line of Business
Number of units | property	3	3
Investment Properties | Partially owned properties | Residential and mixed-use properties
Line of Business
Number of units | property	688

XML

SIGNIFICANT ACCOUNTING POLICIES (Details)		9 Months Ended
	Jan. 03, 2012	Sep. 30, 2022 USD ($) item shares	Sep. 30, 2021 USD ($)	Dec. 31, 2021 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		$ 350,000	$ 180,000
Income Taxes
Provision for income taxes		$ 0
Segment Reporting
Number of segments | item		1
Income Per Unit
Dilutive units | shares		0
Concentration of Credit Risks and Financial Instruments
Single tenants		5	5
Federally uninsured amounts of cash and cash equivalents, and security deposits included in prepaid expenses and other assets		$ 45,045,000		$ 96,166,000
Advertising Expense
Advertising expense		190,316	$ 240,814
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)		2.19%
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		7
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)	9 Months Ended
	Sep. 30, 2022 USD ($) item property	Dec. 31, 2021 USD ($)	Sep. 30, 2021 property
Rental properties
Total fixed assets	$ 404,296,949	$ 400,588,242
Less: Accumulated depreciation	(161,359,023)	(149,233,040)
Total fixed assets, net	242,937,926	251,355,202
Land, improvements and parking lots
Rental properties
Total fixed assets	$ 87,506,136	86,887,276
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	$ 254,618,756	253,952,680
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	$ 17,384,297	16,946,916
Kitchen cabinets | Minimum
Rental properties
Useful Life	5 years
Kitchen cabinets | Maximum
Rental properties
Useful Life	10 years
Carpets
Rental properties
Total fixed assets	$ 12,751,418	12,029,577
Carpets | Minimum
Rental properties
Useful Life	5 years
Carpets | Maximum
Rental properties
Useful Life	10 years
Air conditioning
Rental properties
Total fixed assets	$ 501,697	501,697
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	$ 613,961	608,271
Laundry equipment | Minimum
Rental properties
Useful Life	5 years
Laundry equipment | Maximum
Rental properties
Useful Life	7 years
Elevators
Rental properties
Total fixed assets	$ 1,885,265	1,885,265
Elevators | Minimum
Rental properties
Useful Life	20 years
Elevators | Maximum
Rental properties
Useful Life	40 years
Swimming pools
Rental properties
Total fixed assets	$ 1,090,604	1,090,604
Swimming pools | Minimum
Rental properties
Useful Life	10 years
Swimming pools | Maximum
Rental properties
Useful Life	30 years
Equipment
Rental properties
Total fixed assets	$ 18,767,307	18,072,761
Equipment | Minimum
Rental properties
Useful Life	5 years
Equipment | Maximum
Rental properties
Useful Life	30 years
Motor vehicles
Rental properties
Total fixed assets	$ 171,519	171,519
Motor vehicles | Maximum
Rental properties
Useful Life	5 years
Fences
Rental properties
Total fixed assets	$ 46,872	46,872
Fences | Minimum
Rental properties
Useful Life	5 years
Fences | Maximum
Rental properties
Useful Life	15 years
Furniture and fixtures
Rental properties
Total fixed assets	$ 8,462,476	7,898,163
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	$ 496,641	$ 496,641
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	29
Investment Properties
RENTAL PROPERTIES
Number of units | property	690		865
NERA 40%
RENTAL PROPERTIES
Ownership interest (as a percent)	40.00%
NERA 50%
RENTAL PROPERTIES
Ownership interest (as a percent)	50.00%
Residential and mixed-use properties
RENTAL PROPERTIES
Number of units | item	2,892
Number of properties | item	25
Residential and mixed-use properties | Partially owned properties
RENTAL PROPERTIES
Number of units | item	688
Number of properties | item	7
Residential and mixed-use properties | Investment Properties | Partially owned properties
RENTAL PROPERTIES
Number of units | property	688
Residential and mixed-use properties | Limited Partnerships | Partially owned properties
RENTAL PROPERTIES
Number of properties | item	7
Residential and mixed-use properties | NERA 40%
RENTAL PROPERTIES
Ownership interest (as a percent)	40.00%
Residential and mixed-use properties | NERA 50%
RENTAL PROPERTIES
Ownership interest (as a percent)	50.00%
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

RELATED PARTY TRANSACTIONS (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($) item	Sep. 30, 2021 USD ($)
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			$ 2,029,000	$ 1,868,000
Management fee	$ 683,999	$ 646,059	2,029,453	1,867,798
Repairs and maintenance	3,126,953	3,128,369	8,381,339	7,432,860
Administrative expense	696,656	607,478	2,028,319	1,819,481
Renting	181,574	458,040	501,906	941,281
Employer contributions in 401K plan			70,000
Legal fees			$ 68,000	8,000
Number of limited partnerships and limited liability companies in which the entity has invested | item			7
Interest expense	3,982,445	3,393,518	$ 11,060,794	10,136,630
Investment Properties
RELATED PARTY TRANSACTIONS
Management fee	167,498	156,796	490,999	413,328
Repairs and maintenance	925,670	884,014	2,231,091	2,263,838
Administrative expense	90,892	109,128	273,720	318,532
Renting	49,202	281,698	$ 185,741	615,345
Number of limited partnerships and limited liability companies in which the entity has invested | item			7
Interest expense	$ 1,736,627	$ 1,665,791	$ 5,083,912	4,993,153
Hamilton Company/Management Company
RELATED PARTY TRANSACTIONS
Number of employees having ownership interest in the investment properties | item			5
Dexter Park
RELATED PARTY TRANSACTIONS
Management fee as percentage of gross receipts rental revenue			2.00%
General Partner or Management Company [Member]
RELATED PARTY TRANSACTIONS
Repairs and maintenance			$ 215,000
Administrative expense			256,000
Renting			23,000
Expenses for construction, architectural services and supervision of capital projects			89,000
Costs related to professional services			583,000	766,000
Management Company [Member]
RELATED PARTY TRANSACTIONS
Reimbursement to related party for payroll transfers			2,945,000	2,759,000
Employer contributions in 401K plan			$ 70,000	33,000
Number of accounting staff of related party providing bookkeeping and accounting functions | item			14
Fees for accounting and bookkeeping services			$ 93,750	$ 125,000
Number of employees having ownership interest in the investment properties | item			5
Partially owned properties
RELATED PARTY TRANSACTIONS
Management fee as percentage of gross receipts rental revenue			4.00%
Management fee			$ 491,000
Repairs and maintenance			38,000
Administrative expense			14,000
Construction, architectural services and supervision of capital projects			24,000
Amount paid to related party			$ 567,000
NERA 40%
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	40.00%		40.00%
NERA 50%
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	50.00%		50.00%
Brown Family [Member] | Minimum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	47.60%		47.60%
Brown Family [Member] | Maximum
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	59.00%		59.00%
Residential and mixed-use properties | NERA 40%
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	40.00%		40.00%
Residential and mixed-use properties | NERA 50%
RELATED PARTY TRANSACTIONS
Ownership interest (as a percent)	50.00%		50.00%

XML

PREPAID EXPENSES and OTHER ASSETS (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
OTHER ASSETS
Security deposits	$ 3,402,000	$ 3,067,000
Escrow deposits to fund future capital improvements	1,849,000	1,819,000
Deposits and escrows held for acquisitions	1,907,378	861,697
Intangible assets, net of accumulated amortization	7,000	26,000
Accumulated amortization on intangible assets	1,411,000	1,392,000
Financing fees, net	124,000	169,000
Accumulated amortization on financing and leasing fees	$ 55,000	$ 10,000

XML

MORTGAGE NOTES PAYABLE (Mortgages Payable) (Details) - USD ($)	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
MORTGAGE NOTES PAYABLE
Effective interest rate (as a percent)	4.12%
Financing fees, net	$ 124,000	$ 169,000
Accumulated amortization on financing and leasing fees	55,000	10,000
Annual maturities of mortgage debt
2023-current maturities	8,583,000
2024	2,749,000
2025	3,260,000
2026	25,209,000
2027	3,121,000
Thereafter	371,767,000
Total	414,689,000
Less: unamortized deferred financing costs	(3,213,000)
Secured Debt	411,475,632	370,481,390
Mortgages payable
MORTGAGE NOTES PAYABLE
Amount of monthly installments including principal	$ 1,471,000
Weighted average interest rate (as a percent)	3.69%
Effective interest rate (as a percent)	3.80%
Financing fees, net	$ 3,213,000	2,709,000
Accumulated amortization on financing and leasing fees	$ 948,000	$ 1,139,000
Mortgages payable | Minimum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)	2.97%
Mortgages payable | Maximum
MORTGAGE NOTES PAYABLE
Interest rate (as a percent)	4.95%

XML

MORTGAGE NOTES PAYABLE (Facility Agreement) (Details) - USD ($)		9 Months Ended
	Jun. 16, 2022	Sep. 30, 2022	Sep. 30, 2021	Jun. 17, 2022	Nov. 30, 2021
Debt Instrument [Line Items]
Payment of debt		$ 1,720,335	$ 1,704,743
Proceeds from Mortgage Notes Payable		$ 41,937,337
Facility Agreement
Debt Instrument [Line Items]
Mortgage amount				$ 80,284,000	$ 156,000,000
Interest rate (as a percent)	4.33%				2.97%
Payment of debt	$ 37,065,000
Mortgage prepayment penalties	854,000
Proceeds from Mortgage Notes Payable	$ 42,384,000

XML

MORTGAGE NOTES PAYABLE (Line of Credit) (Details)					1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 03, 2021 USD ($)	Oct. 29, 2021 USD ($)	Sep. 30, 2015	Jul. 31, 2014 USD ($)	Aug. 31, 2014	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($)	Dec. 31, 2020 USD ($)	Jul. 31, 2017 USD ($)	Mar. 07, 2005 item
Line of Credit
Interest expense						$ 3,982,445	$ 3,393,518	$ 11,060,794	$ 10,136,630
Hamilton Essex 81
Line of Credit
Interest expense						$ 116,185	$ 61,827	$ 257,574	$ 184,542
Number of properties in which borrowing amount collateralized | item												1
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
Mortgages payable | LIBOR | Hamilton Essex 81
Line of Credit
Variable interest rate spread			2.18%
Line of Credit
Line of Credit
Maximum borrowings		$ 25,000,000		$ 25,000,000
Maximum borrowings during modification period		$ 17,000,000
Term of debt		3 years		3 years
Payment on line of credit	$ 17,000,000
Additional applicable margin rate				2.50%
Amount of refinancing costs		$ 179,000
Line of credit extension period										1 year
Extension fees paid										$ 37,500	$ 128,000
Number of properties in which borrowing amount collateralized | property						23		23
Debt yield								8.05%
Line of Credit | Current covenants
Line of Credit
Leverage ratio		65.00%
Tangible net worth		$ 200,000,000
Debt yield		9.50%
Debt service coverage ratio		1.60
Line of Credit | Revised covenants in place until September 30, 2022
Line of Credit
Leverage ratio		70.00%
Tangible net worth		$ 175,000,000
Debt yield		8.50%
Debt service coverage ratio		1.35
Line of Credit | Revised Covenants in place until December 31, 2022
Line of Credit
Debt yield		9.00%
Line of Credit | Federal Funds Rate
Line of Credit
Variable interest rate spread				0.50%
Line of Credit | LIBOR
Line of Credit
Variable interest rate spread		3.00%		1.00%
Line of Credit | Minimum
Line of Credit
Pledged interest ownership percentage								49.00%
Line of Credit | Maximum
Line of Credit
Pledged interest ownership percentage								100.00%

XML

ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS (Details)	9 Months Ended
	Sep. 30, 2022 USD ($)
ADVANCE RENTAL PAYMENTS AND SECURITY DEPOSITS
Period for advance rental payment	1 month
Amount received for prepaid rent	$ 2,581,000
Security deposits	$ 3,402,000

XML

PARTNERS' CAPITAL (Details)	1 Months Ended			9 Months Ended
	Jul. 31, 2022 $ / item	Apr. 30, 2022 $ / item	Jan. 31, 2022 $ / item	Sep. 30, 2022 item $ / item	Sep. 30, 2021 $ / item	Dec. 31, 2021 $ / item	Jun. 30, 2021 $ / item	Mar. 31, 2021 $ / item
Depositary receipts exchange ratio for Class A units | item				30
Quarterly distribution per unit approved (in dollars per unit)	9.60	9.60	9.60
Quarterly distributions per depositary receipt (in dollars per receipt)					9.60	9.60	9.60	9.60
Quarterly distribution per unit (in dollars per unit)		0.32	0.32	0.32	0.32	0.32	0.32	0.32
Special distribution per unit (in dollars per unit)			38.40
Special distribution per depository receipt (in dollars per receipt)			1.28
Earnings per depository receipt
Net Income (loss) per Depositary Receipt (in dollars per receipt)				0.44	0.05
Distributions per Depositary Receipt (in dollars per share)				2.24	0.96
Limited Partner
Number of classes of partners | item				2
General Partnership
Number of classes of partners | item				1
Fixed distribution percentage of unit holders				1.00%
Class A
Fixed distribution percentage of unit holders				80.00%
Class B
Fixed distribution percentage of unit holders				19.00%

XML

TREASURY UNITS (Details)				4 Months Ended	9 Months Ended
	Mar. 09, 2020	Mar. 10, 2015 shares	Aug. 20, 2007 shares	Jan. 19, 2023 USD ($) $ / item shares	Sep. 30, 2022 USD ($) $ / item shares	Jan. 03, 2012	Mar. 06, 2008 shares
Treasury units					60,901
Period for repurchase of depository receipts	5 years	5 years	12 months
Depository receipts authorized to be repurchased		2,000,000	300,000				1,500,000
Units required to be repurchased (in shares)					2,192
Total cost of repurchase | $					$ 5,167,667
Subsequent event
Number of depository receipts repurchased				1,658
Repurchase price of depository receipts (in dollars per receipt) | $ / item				76.58
Total cost of repurchase | $				$ 127,565
Cumulative amount from August 20, 2007 through the current period.
Number of depository receipts repurchased					1,486,802
Repurchase price of depository receipts (in dollars per receipt) | $ / item					30.09
Repurchase price of units (in dollars per unit) | $ / item					902.70
Total cost of repurchase | $					$ 50,336,000
General Partnership
Treasury units					609
Fixed distribution percentage of unit holders					1.00%
Total cost of repurchase | $					$ 51,645
Repurchases required (in units)					21.92
General Partnership | Subsequent event
Units required to be repurchased (in shares)				1
Value of units required to be repurchased | $				$ 1,587
General Partnership | Cumulative amount from August 20, 2007 through the current period.
Number of depository receipts repurchased					212
Treasury Units
Units required to be repurchased (in shares)					2,192
Class A
Treasury units					48,721
Number of units in each depository receipt			0.1			0.03333
Fixed distribution percentage of unit holders					80.00%
Number of depository receipts repurchased					52,613
Repurchase price of depository receipts (in dollars per receipt) | $ / item					78.53
Repurchase price of units (in dollars per unit) | $ / item					2,355.90
Total cost of repurchase | $					$ 4,134,773
Class B
Treasury units					11,571
Fixed distribution percentage of unit holders					19.00%
Total cost of repurchase | $					$ 981,249
Repurchases required (in units)					416.52
Class B | Subsequent event
Units required to be repurchased (in shares)				13
Value of units required to be repurchased | $				$ 30,154
Class B | Cumulative amount from August 20, 2007 through the current period.
Number of depository receipts repurchased					4,034
Class B | General Partnership | Cumulative amount from August 20, 2007 through the current period.
Repurchase price of units (in dollars per unit) | $ / item					1,179.00

XML

RENTAL INCOME (Details)	9 Months Ended
	Sep. 30, 2022 USD ($)
RENTAL INCOME
Percentage of rental income related to residential apartments and condominium units with leases of one year or less	95.00%
Maximum period of non-cancelable operating lease	1 year
Percentage of rental income related to commercial properties	5.00%
Minimum future rental income
2023	$ 1,981,000
2024	1,409,000
2025	871,000
2026	728,000
2027	406,000
Thereafter	1,683,000
Commercial Property Leases	$ 7,078,000

XML

RENTAL INCOME (Concentration) (Details) - USD ($)	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Concentration Risk
Aggregate contingent rentals	$ 441,000	$ 417,000
Commercial rental income | Major tenant | Staples and Trader Joes
Concentration Risk
Concentration risk percentage	28.00%

XML

RENTAL INCOME (Commercial Leases) (Details)	9 Months Ended
	Sep. 30, 2022 USD ($) ft² item
RENTAL INCOME
Annual base rent for expiring leases | $	$ 2,211,981
Total square feet for expiring leases | ft²	108,369
Total number of leases expiring | item	52
Percentage of annual base rent for expiring leases	100.00%
2023
RENTAL INCOME
Annual base rent for expiring leases | $	$ 430,143
Total square feet for expiring leases | ft²	55,286
Total number of leases expiring | item	22
Percentage of annual base rent for expiring leases	19.00%
2024
RENTAL INCOME
Annual base rent for expiring leases | $	$ 785,710
Total square feet for expiring leases | ft²	26,248
Total number of leases expiring | item	13
Percentage of annual base rent for expiring leases	37.00%
2025
RENTAL INCOME
Annual base rent for expiring leases | $	$ 135,210
Total square feet for expiring leases | ft²	2,461
Total number of leases expiring | item	4
Percentage of annual base rent for expiring leases	6.00%
2026
RENTAL INCOME
Annual base rent for expiring leases | $	$ 198,266
Total square feet for expiring leases | ft²	5,396
Total number of leases expiring | item	4
Percentage of annual base rent for expiring leases	9.00%
2027
RENTAL INCOME
Annual base rent for expiring leases | $	$ 269,210
Total square feet for expiring leases | ft²	11,716
Total number of leases expiring | item	5
Percentage of annual base rent for expiring leases	12.00%
2028
RENTAL INCOME
Annual base rent for expiring leases | $	$ 93,873
Total square feet for expiring leases | ft²	2,158
Total number of leases expiring | item	1
Percentage of annual base rent for expiring leases	4.00%
2029
RENTAL INCOME
Annual base rent for expiring leases | $	$ 181,324
Total square feet for expiring leases | ft²	5,104
Total number of leases expiring | item	2
Percentage of annual base rent for expiring leases	8.00%
Thereafter
RENTAL INCOME
Annual base rent for expiring leases | $	$ 118,245
Total number of leases expiring | item	1
Percentage of annual base rent for expiring leases	5.00%

XML

RENTAL INCOME (Rent Receivable) (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
RENTAL INCOME
Allowance for doubtful rent receivable	$ 824,000	$ 832,000
Recognizing rental income from non-cancelable commercial leases with future rental increases on a straight-line basis	76,000
Deferred rental concession	$ 13,000

XML

CASH FLOW INFORMATION (Details)	9 Months Ended
	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($)
CASH FLOW INFORMATION
Interest Paid	$ 10,584,000	$ 9,985,000
Cash paid for state income taxes	52,000	$ 70,000
Non-cash financing activities in connection with refinancing	$ 37,000,000
Number of properties involved in non cash activities | property	4

XML

FAIR VALUE MEASUREMENTS (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Liabilities
Carrying Amount	$ 411,475,632	$ 370,481,390
Carrying Amount
Assets
Cash equivalents	59,473,939	96,083,508
Treasury bills	73,995,586
Assets , Fair value	133,469,525	96,083,508
Liabilities
Carrying Amount	577,595,590	536,685,095
Estimated Fair Value
Assets
Cash equivalents	59,529,805	96,083,508
Treasury bills	74,158,935
Assets , Fair value	133,688,740	96,083,508
Liabilities
Estimated Fair Value	522,814,114	559,125,896
Wholly owned properties | Carrying Amount
Liabilities
Carrying Amount	411,475,632	370,481,390
Wholly owned properties | Estimated Fair Value
Liabilities
Estimated Fair Value	366,891,771	383,244,134
Partially owned properties | Carrying Amount
Liabilities
Carrying Amount	166,119,958	166,203,705
Partially owned properties | Estimated Fair Value
Liabilities
Estimated Fair Value	$ 155,922,343	$ 175,881,762

XML

TAXABLE INCOME AND TAX BASIS (Details)	12 Months Ended
	Dec. 31, 2021 USD ($)
TAXABLE INCOME AND TAX BASIS
Taxable net income	$ 4,056,000
Excess amount of statement income over taxable income	6,756,000
Excess amount of cumulative statement basis over cumulative taxable basis	10,946,000
Excess amount of statement income from joint venture investments over taxable income	$ 1,066,000

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Details)	9 Months Ended
	Sep. 30, 2022 item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of limited partnerships and limited liability companies in which the entity has invested	7
Investment Properties
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of limited partnerships and limited liability companies in which the entity has invested	7
Number of partnerships investing in commercial property	3
Hamilton Company/Management Company
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of employees having ownership interest in the investment properties	5
NERA 40%
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	40.00%
NERA 50%
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	50.00%
Management Company [Member]
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of employees having ownership interest in the investment properties	5
Minimum | Brown Family [Member]
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	47.60%
Maximum | Brown Family [Member]
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Ownership interest (as a percent)	59.00%

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Dexter) (Details)			3 Months Ended	9 Months Ended
	May 31, 2018 USD ($)	Oct. 28, 2009 USD ($) item	Sep. 30, 2018 USD ($)	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($) property	Dec. 31, 2021 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 1,439,150		$ 1,455,888
Outstanding amount of mortgage				411,475,632		$ 370,481,390
Distribution to the Partnership				$ 8,123,130	$ 3,506,581
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units		409		409	409
Outstanding amount of mortgage	$ 82,000,000			$ 124,633,803	$ 124,569,180
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				$ 81,231	$ 35,065
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
Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 15,925,000
Ownership interest (as a percent)		40.00%
Purchase price of real estate properties		$ 129,500,000
Residential buildings | Dexter Park
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				409	409

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Essex) (Details)				9 Months Ended
	Oct. 12, 2016 USD ($)	Sep. 30, 2015 USD ($)	Mar. 07, 2005 USD ($) item	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($) property	Dec. 31, 2021 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 1,439,150		$ 1,455,888
Repayment of loan	$ 5,158,000
Distribution to the Partnership				8,123,130	$ 3,506,581
Mortgage Notes Payable				$ 411,475,632		$ 370,481,390
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units			48	49	49
Number of properties in which borrowing amount collateralized | item			1
Distribution to the Partnership		$ 978,193
Mortgage Notes Payable				$ 9,958,633	$ 9,944,844
Hamilton Essex Development
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				1	1
Capacity of real estate property (in cars per lot) | item			50
Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 2,000,000
Ownership interest (as a percent)			50.00%
Purchase price of real estate properties			$ 14,300,000
Residential buildings | Hamilton Essex 81
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				48	48
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)				4.95%
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%

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton 1025) (Details)	Jul. 08, 2016 USD ($)	Mar. 02, 2005 USD ($) item	Sep. 30, 2022 USD ($) property	Dec. 31, 2021 USD ($)	Sep. 30, 2021 property	Mar. 05, 2005 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 1,439,150	$ 1,455,888
Outstanding amount of mortgage			$ 411,475,632	$ 370,481,390
Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units		176	176		176
Number of units sold | item		127
Number of units retained for long-term investment		49	(1)		(1)
Capital contributions	$ 2,359,500
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
Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture		$ 2,352,000
Ownership interest (as a percent)		50.00%
Purchase price of investments						$ 23,750,000
Residential buildings | Hamilton 1025
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property			175		175

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton Minuteman) (Details)			1 Months Ended	9 Months Ended
	Oct. 13, 2016 USD ($)	Oct. 12, 2016 USD ($)	Sep. 30, 2004 USD ($) item	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($) property	Dec. 31, 2021 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 1,439,150		$ 1,455,888
Distribution to the Partnership				8,123,130	$ 3,506,581
Amount of mortgage paid off		$ 5,158,000
Refinancing costs				3,213,000
Outstanding amount of mortgage				$ 411,475,632		$ 370,481,390
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units			42	42	42
Purchase price of real estate properties			$ 10,100,000
Distribution to the Partnership	$ 385,000
Mortgage amount		$ 6,000,000		$ 6,000,000
Term of debt		15 years
Refinancing costs	$ 123,000			73,311
Interest rate (as a percent)		3.71%
Outstanding amount of mortgage				$ 5,926,689	$ 5,918,506
Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 5,075,000
Ownership interest (as a percent)			50.00%
Residential buildings | Hamilton Minuteman
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				42	42

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Hamilton on Main) (Details)		1 Months Ended		9 Months Ended
	Oct. 12, 2016 USD ($)	Aug. 31, 2014 USD ($)	Aug. 31, 2004 USD ($) item	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($) property	Dec. 31, 2021 USD ($)
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture				$ 1,439,150		$ 1,455,888
Outstanding amount of mortgage				411,475,632		$ 370,481,390
Repayment of loan	$ 5,158,000
Distribution to the Partnership				$ 8,123,130	$ 3,506,581
Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units			280	148	148
Number of units sold | item			137
Outstanding amount of mortgage				$ 16,869,235	$ 16,853,184
Hamilton on Main Apartments, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Purchase price of real estate properties			$ 56,000,000
Hamilton on Main Apartments, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 8,000,000
Ownership interest (as a percent)			50.00%
Residential buildings | Hamilton on Main Apts
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units | property				148	148
Mortgages payable | Hamilton on Main Apartments, LLC
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Term of debt		10 years
Outstanding amount of mortgage				$ 16,900,000
Interest rate (as a percent)		4.34%
Debt Instrument, Loan Proceeds distributed to the Partnership		$ 850,000
Repayment of loan		15,205,000
Cost associated with loan extension		161,000
Borrowings		$ 16,900,000

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (345 Franklin) (Details)		1 Months Ended	9 Months Ended
	Oct. 12, 2016 USD ($)	Jun. 30, 2013 USD ($)	Sep. 30, 2022 USD ($) property	Sep. 30, 2021 USD ($) property	Dec. 31, 2021 USD ($)	Nov. 30, 2001 USD ($) item
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture			$ 1,439,150		$ 1,455,888
Repayment of loan	$ 5,158,000
Distribution to the Partnership			8,123,130	$ 3,506,581
Outstanding amount of mortgage			$ 411,475,632		$ 370,481,390
Maximum | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Interest rate (as a percent)			4.95%
345 Franklin | Mortgages payable
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Outstanding amount of mortgage			$ 8,770,000
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Investments in joint venture						$ 1,533,000
Ownership interest (as a percent)						50.00%
345 Franklin
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES
Number of units			40	40		40
Distribution to the Partnership		$ 1,610,000
Outstanding amount of mortgage			$ 8,731,598	$ 8,944,849
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)	Sep. 30, 2022 USD ($) property	Dec. 31, 2021 USD ($)	Sep. 30, 2021 USD ($) property	Dec. 31, 2020 USD ($)	May 31, 2018 USD ($)	Oct. 28, 2009 item	Mar. 07, 2005 item	Mar. 02, 2005 item	Sep. 30, 2004 item	Aug. 31, 2004 item	Nov. 30, 2001 item
ASSETS
Rental Properties	$ 242,937,926	$ 251,355,202
Cash and Cash Equivalents	59,473,939	96,083,508
Rents Receivable	414,659	935,303
Real Estate Tax Escrows	1,907,378	861,697
Prepaid Expenses and Other Assets	7,613,638	6,183,981
Total Assets	387,782,276	356,875,579
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	411,475,632	370,481,390
Accounts Payable and Accrued Expenses	4,298,250	4,324,879
Advance Rental Payments and Security Deposits	8,874,364	8,369,497
Total Liabilities	448,785,055	406,168,186
Partners' Capital	(61,002,779)	(49,292,607)	$ (44,775,300)	$ (41,469,045)
Total Liabilities and Partners' Capital	387,782,276	356,875,579
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	(24,136,809)	$ (22,992,420)
Investment Properties
ASSETS
Rental Properties	108,350,429		112,651,474
Cash and Cash Equivalents	4,552,975		3,436,649
Rents Receivable	350,682		392,089
Real Estate Tax Escrows	282,364		297,534
Prepaid Expenses and Other Assets	3,048,044		2,684,999
Total Assets	116,584,494		119,462,745
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	166,119,958		166,230,563
Accounts Payable and Accrued Expenses	1,197,476		1,228,687
Advance Rental Payments and Security Deposits	4,063,914		3,493,954
Total Liabilities	171,381,348		170,953,204
Partners' Capital	(54,796,854)		(51,490,459)
Total Liabilities and Partners' Capital	116,584,494		119,462,745
Investment in Unconsolidated Joint Ventures	1,439,150		1,418,974
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	(24,136,809)		(22,734,423)
Total Investment in Unconsolidated Joint Ventures (Net)	$ (22,697,659)		$ (21,315,449)
Total units/ condominiums
Total | property	690		865
Units to be retained | property	690		690
Total number of units sold | property	175		175
Investment Properties | Residential buildings
Total units/ condominiums
Total | property	687		862
Investment Properties | Commercial
Total units/ condominiums
Total | property	3		3
Hamilton Essex 81
ASSETS
Rental Properties	$ 5,935,095		$ 6,376,891
Cash and Cash Equivalents	883,219		230,394
Rents Receivable	198,014		65,313
Real Estate Tax Escrows	74,625		77,685
Prepaid Expenses and Other Assets	321,917		311,513
Total Assets	7,412,870		7,061,796
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	9,958,633		9,944,844
Accounts Payable and Accrued Expenses	120,784		82,137
Advance Rental Payments and Security Deposits	332,572		189,746
Total Liabilities	10,411,989		10,216,727
Partners' Capital	(2,999,119)		(3,154,931)
Total Liabilities and Partners' Capital	$ 7,412,870		$ 7,061,796
Partners' Capital %-NERA	50.00%		50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	$ (1,499,560)		$ (1,577,467)
Total units/ condominiums
Total	49		49				48
Units to be retained | property	49		49
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	$ 2,586,302		$ 2,588,792
Cash and Cash Equivalents	88,190		73,049
Rents Receivable	77,561		13,744
Prepaid Expenses and Other Assets	56,261		67,410
Total Assets	2,808,314		2,742,995
LIABILITIES AND PARTNERS' CAPITAL
Accounts Payable and Accrued Expenses	2,250		2,250
Advance Rental Payments and Security Deposits	19,865
Total Liabilities	22,115		2,250
Partners' Capital	2,786,199		2,740,745
Total Liabilities and Partners' Capital	$ 2,808,314		$ 2,742,995
Partners' Capital %-NERA	50.00%		50.00%
Investment in Unconsolidated Joint Ventures	$ 1,393,100		$ 1,370,373
Total units/ condominiums
Total | property	1		1
Units to be retained | property	1		1
Hamilton Essex Development | Commercial
Total units/ condominiums
Total | property	1		1
345 Franklin
ASSETS
Rental Properties	$ 4,852,841		$ 5,139,866
Cash and Cash Equivalents	265,808		154,633
Rents Receivable	1,240		23,113
Real Estate Tax Escrows	69,748		62,506
Prepaid Expenses and Other Assets	117,224		123,115
Total Assets	5,306,861		5,503,233
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	8,731,598		8,944,849
Accounts Payable and Accrued Expenses	92,492		99,583
Advance Rental Payments and Security Deposits	280,818		247,951
Total Liabilities	9,104,908		9,292,383
Partners' Capital	(3,798,047)		(3,789,150)
Total Liabilities and Partners' Capital	$ 5,306,861		$ 5,503,233
Partners' Capital %-NERA	50.00%		50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	$ (1,899,023)		$ (1,894,576)
Total units/ condominiums
Total	40		40								40
Units to be retained | property	40		40
345 Franklin | Residential buildings
Total units/ condominiums
Total | property	40		40
Hamilton 1025
ASSETS
Rental Properties	$ 79,107		$ 82,371
Cash and Cash Equivalents	9,882		9,776
Rents Receivable	4,906		7,081
Prepaid Expenses and Other Assets	757		685
Total Assets	94,652		99,913
LIABILITIES AND PARTNERS' CAPITAL
Accounts Payable and Accrued Expenses	2,553		2,711
Total Liabilities	2,553		2,711
Partners' Capital	92,099		97,202
Total Liabilities and Partners' Capital	$ 94,652		$ 99,913
Partners' Capital %-NERA	50.00%		50.00%
Investment in Unconsolidated Joint Ventures	$ 46,050		$ 48,601
Total units/ condominiums
Total	176		176					176
Units to be retained	1		1					(49)
Total number of units sold | property	175		175
Hamilton 1025 | Residential buildings
Total units/ condominiums
Total | property	175		175
Hamilton 1025 | Commercial
Total units/ condominiums
Total | property	1		1
Hamilton Minuteman
ASSETS
Rental Properties	$ 4,551,023		$ 4,766,334
Cash and Cash Equivalents	175,451		231,357
Rents Receivable	5,299		7,285
Real Estate Tax Escrows	32,497		40,025
Prepaid Expenses and Other Assets	28,665		30,592
Total Assets	4,792,935		5,075,593
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	5,926,689		5,918,506
Accounts Payable and Accrued Expenses	59,237		67,629
Advance Rental Payments and Security Deposits	161,741		154,400
Total Liabilities	6,147,667		6,140,535
Partners' Capital	(1,354,732)		(1,064,942)
Total Liabilities and Partners' Capital	$ 4,792,935		$ 5,075,593
Partners' Capital %-NERA	50.00%		50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	$ (677,366)		$ (532,472)
Total units/ condominiums
Total	42		42						42
Units to be retained | property	42		42
Hamilton Minuteman | Residential buildings
Total units/ condominiums
Total | property	42		42
Hamilton on Main Apts
ASSETS
Rental Properties	$ 13,688,356		$ 14,522,033
Cash and Cash Equivalents	910,242		602,344
Rents Receivable	18,832		38,832
Real Estate Tax Escrows	105,494		117,318
Prepaid Expenses and Other Assets	224,845		195,099
Total Assets	14,947,769		15,475,626
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	16,869,235		16,853,184
Accounts Payable and Accrued Expenses	163,200		169,515
Advance Rental Payments and Security Deposits	430,923		474,463
Total Liabilities	17,463,358		17,497,162
Partners' Capital	(2,515,589)		(2,021,536)
Total Liabilities and Partners' Capital	$ 14,947,769		$ 15,475,626
Partners' Capital %-NERA	50.00%		50.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	$ (1,257,794)		$ (1,010,769)
Total units/ condominiums
Total	148		148							280
Units to be retained | property	148		148
Hamilton on Main Apts | Residential buildings
Total units/ condominiums
Total | property	148		148
Dexter Park
ASSETS
Rental Properties	$ 76,657,705		$ 79,175,187
Cash and Cash Equivalents	2,220,183		2,135,096
Rents Receivable	44,830		236,721
Prepaid Expenses and Other Assets	2,298,375		1,956,585
Total Assets	81,221,093		83,503,589
LIABILITIES AND PARTNERS' CAPITAL
Mortgage Notes Payable	124,633,803		124,569,180		$ 82,000,000
Accounts Payable and Accrued Expenses	756,960		804,862
Advance Rental Payments and Security Deposits	2,837,995		2,427,394
Total Liabilities	128,228,758		127,801,436
Partners' Capital	(47,007,665)		(44,297,847)
Total Liabilities and Partners' Capital	$ 81,221,093		$ 83,503,589
Partners' Capital %-NERA	40.00%		40.00%
Distribution and Loss in Excess of investments in Unconsolidated Joint Venture	$ (18,803,066)		$ (17,719,140)
Total units/ condominiums
Total	409		409			409
Units to be retained | property	409		409
Dexter Park | Residential buildings
Total units/ condominiums
Total | property	409		409

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Income) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenues
Rental income	$ 16,974,515	$ 15,832,492	$ 50,260,258	$ 46,145,825
Laundry and sundry income	103,868	114,180	330,461	336,980
Total Revenues	17,078,383	15,946,672	50,590,719	46,482,805
Expenses
Administrative	696,656	607,478	2,028,319	1,819,481
Depreciation and amortization	4,114,913	3,956,979	12,212,278	11,806,561
Management fee	683,999	646,059	2,029,453	1,867,798
Operating	1,410,843	1,338,718	5,609,302	4,792,332
Renting	181,574	458,040	501,906	941,281
Repairs and maintenance	3,126,953	3,128,369	8,381,339	7,432,860
Taxes and insurance	2,302,648	2,259,793	6,879,455	6,688,885
Total Expenses	12,517,586	12,395,436	37,642,052	35,349,198
Income Before Other Income (Expense)	4,560,797	3,551,236	12,948,667	11,133,607
Other Income (Expense)
Interest expense	(3,982,445)	(3,393,518)	(11,060,794)	(10,136,630)
Interest income	363,350	27	363,411	74
Total Other Income (Expense)	(3,565,573)	(3,626,621)	(11,368,042)	(10,933,281)
Net Income	995,224	(75,385)	1,580,625	200,326
Investment Properties
Revenues
Rental income	6,029,010	5,317,161	17,255,169	14,989,292
Laundry and sundry income	36,557	37,731	109,285	114,758
Total Revenues	6,065,567	5,354,892	17,364,454	15,104,050
Expenses
Administrative	90,892	109,128	273,720	318,532
Depreciation and amortization	1,513,629	1,508,364	4,504,686	4,496,088
Management fee	167,498	156,796	490,999	413,328
Operating	451,350	462,631	1,457,229	1,327,298
Renting	49,202	281,698	185,741	615,345
Repairs and maintenance	925,670	884,014	2,231,091	2,263,838
Taxes and insurance	937,128	895,491	2,755,975	2,643,200
Total Expenses	4,135,369	4,298,122	11,899,441	12,077,629
Income Before Other Income (Expense)	1,930,198	1,056,770	5,465,013	3,026,421
Other Income (Expense)
Interest expense	(1,736,627)	(1,665,791)	(5,083,912)	(4,993,153)
Other Income				1,222
Total Other Income (Expense)	(1,736,627)	(1,665,791)	(5,083,912)	(4,991,931)
Net Income	193,571	(609,021)	381,101	(1,965,510)
Proportionate share of net income (loss)	93,516	(233,130)	203,867	(796,725)
Investment Properties | NERA 50%
Other Income (Expense)
Proportionate share of net income (loss)	80,451	52,403	257,136	(52,597)
Investment Properties | NERA 40%
Other Income (Expense)
Proportionate share of net income (loss)	13,065	(285,533)	(53,269)	(744,128)
Hamilton Essex 81
Revenues
Rental income	433,819	414,497	1,194,570	856,569
Laundry and sundry income	4,445	2,986	9,839	9,194
Total Revenues	438,264	417,483	1,204,409	865,763
Expenses
Administrative	5,640	16,576	14,512	70,445
Depreciation and amortization	119,789	120,266	358,568	358,788
Management fee	21,620	17,335	58,716	29,181
Operating	49,866	60,232	169,086	129,400
Renting	9,759	26,272	23,823	81,149
Repairs and maintenance	62,158	41,335	132,026	123,467
Taxes and insurance	66,313	64,799	199,415	195,974
Total Expenses	335,145	346,815	956,146	988,404
Income Before Other Income (Expense)	103,119	70,668	248,263	(122,641)
Other Income (Expense)
Interest expense	(116,185)	(61,827)	(257,574)	(184,542)
Total Other Income (Expense)	(116,185)	(61,827)	(257,574)	(184,542)
Net Income	(13,066)	8,841	(9,311)	(307,183)
Hamilton Essex 81 | NERA 50%
Other Income (Expense)
Proportionate share of net income (loss)	(6,534)	4,421	(4,656)	(153,593)
Hamilton Essex Development
Revenues
Rental income	60,471	111,191	235,842	168,431
Total Revenues	60,471	111,191	235,842	168,431
Expenses
Administrative	4,250	750	5,798	2,103
Depreciation and amortization	2,927	5,074	8,782	15,223
Management fee	2,353	6,187	9,879	6,187
Repairs and maintenance			3,180	520
Taxes and insurance	15,566	15,228	47,074	45,037
Total Expenses	25,096	27,239	74,713	69,070
Income Before Other Income (Expense)	35,375	83,952	161,129	99,361
Other Income (Expense)
Net Income	35,375	83,952	161,129	99,361
Hamilton Essex Development | NERA 50%
Other Income (Expense)
Proportionate share of net income (loss)	17,688	41,976	80,565	49,681
345 Franklin
Revenues
Rental income	392,851	343,674	1,107,677	1,019,465
Laundry and sundry income			120	112
Total Revenues	392,851	343,674	1,107,797	1,019,577
Expenses
Administrative	6,060	7,129	26,052	22,651
Depreciation and amortization	86,776	86,449	259,967	257,314
Management fee	15,610	13,943	43,719	40,288
Operating	18,186	16,060	54,901	42,137
Renting	10,650	12,174	27,857	46,108
Repairs and maintenance	41,565	35,687	125,323	100,182
Taxes and insurance	44,269	44,194	131,736	131,574
Total Expenses	223,116	215,636	669,555	640,254
Income Before Other Income (Expense)	169,735	128,038	438,242	379,323
Other Income (Expense)
Interest expense	(86,694)	(89,248)	(263,093)	(269,993)
Total Other Income (Expense)	(86,694)	(89,248)	(263,093)	(269,993)
Net Income	83,041	38,790	175,149	109,330
345 Franklin | NERA 50%
Other Income (Expense)
Proportionate share of net income (loss)	41,520	19,395	87,575	54,665
Hamilton 1025
Revenues
Rental income	27,813	26,410	77,935	75,148
Total Revenues	27,813	26,410	77,935	75,148
Expenses
Administrative	793	651	2,142	2,140
Depreciation and amortization	816	816	2,448	2,448
Management fee	1,112	1,272	3,166	2,843
Operating		55	1,219	231
Operating	54
Taxes and insurance	4,448	4,634	13,567	14,535
Total Expenses	7,223	7,428	22,542	22,197
Income Before Other Income (Expense)	20,590	18,982	55,393	52,951
Other Income (Expense)
Net Income	20,590	18,982	55,393	52,951
Hamilton 1025 | NERA 50%
Other Income (Expense)
Proportionate share of net income (loss)	10,295	9,491	27,697	26,476
Hamilton Minuteman
Revenues
Rental income	300,345	293,988	899,186	865,196
Laundry and sundry income		1,243	472	4,548
Total Revenues	300,345	295,231	899,658	869,744
Expenses
Administrative	3,542	3,824	9,297	11,485
Depreciation and amortization	84,966	84,827	253,369	253,180
Management fee	12,438	11,716	35,967	34,592
Operating	20,336	23,542	95,538	78,038
Renting	1,974	375	8,988	1,095
Repairs and maintenance	37,999	30,184	82,989	86,566
Taxes and insurance	38,546	36,986	114,224	107,198
Total Expenses	199,801	191,454	600,372	572,154
Income Before Other Income (Expense)	100,544	103,777	299,286	297,590
Other Income (Expense)
Interest expense	(59,000)	(59,880)	(177,129)	(177,757)
Total Other Income (Expense)	(59,000)	(59,880)	(177,129)	(177,757)
Net Income	41,544	43,897	122,157	119,833
Hamilton Minuteman | NERA 50%
Other Income (Expense)
Proportionate share of net income (loss)	20,771	21,949	61,078	59,917
Hamilton on Main Apts
Revenues
Rental income	919,313	827,140	2,725,431	2,491,414
Laundry and sundry income	8,252	9,796	25,402	27,837
Total Revenues	927,565	836,936	2,750,833	2,519,251
Expenses
Administrative	16,448	14,592	52,028	49,372
Depreciation and amortization	270,802	272,874	808,116	813,435
Management fee	36,098	32,831	108,615	97,262
Operating	90,931	101,948	282,757	315,638
Renting	14,264	20,213	39,844	71,772
Repairs and maintenance	188,269	177,652	494,223	446,677
Taxes and insurance	125,879	115,028	387,242	336,333
Total Expenses	742,691	735,138	2,172,825	2,130,489
Income Before Other Income (Expense)	184,874	101,798	578,008	388,762
Other Income (Expense)
Interest expense	(191,453)	(191,453)	(568,251)	(568,246)
Total Other Income (Expense)	(191,453)	(191,453)	(568,251)	(568,246)
Net Income	(6,579)	(89,655)	9,757	(179,484)
Hamilton on Main Apts | NERA 50%
Other Income (Expense)
Proportionate share of net income (loss)	(3,289)	(44,829)	4,879	(89,742)
Dexter Park
Revenues
Rental income	3,894,398	3,300,261	11,014,528	9,513,069
Laundry and sundry income	23,860	23,706	73,452	73,067
Total Revenues	3,918,258	3,323,967	11,087,980	9,586,136
Expenses
Administrative	54,159	65,606	163,891	160,336
Depreciation and amortization	947,553	938,058	2,813,436	2,795,700
Management fee	78,267	73,512	230,937	202,975
Operating	271,977	260,794	853,728	761,854
Renting	12,555	222,664	85,229	415,221
Repairs and maintenance	595,679	599,156	1,393,350	1,506,426
Taxes and insurance	642,107	614,622	1,862,717	1,812,549
Total Expenses	2,602,297	2,774,412	7,403,288	7,655,061
Income Before Other Income (Expense)	1,315,961	549,555	3,684,692	1,931,075
Other Income (Expense)
Interest expense	(1,283,295)	(1,263,383)	(3,817,865)	(3,792,615)
Other Income				1,222
Total Other Income (Expense)	(1,283,295)	(1,263,383)	(3,817,865)	(3,791,393)
Net Income	32,666	(713,828)	(133,173)	(1,860,318)
Dexter Park | NERA 40%
Other Income (Expense)
Proportionate share of net income (loss)	$ 13,065	$ (285,533)	$ (53,269)	$ (744,128)

XML

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Mortgage Maturities) (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	May 31, 2018	Oct. 13, 2016
Annual maturities of mortgage debt
2023-current maturities	$ 8,583,000
2024	2,749,000
2025	3,260,000
2026	25,209,000
2027	3,121,000
Thereafter	371,767,000
Total	414,689,000
Less: unamortized deferred financing costs	(3,213,000)
Secured Debt	$ 411,475,632	$ 370,481,390
Weighted average interest rate (as a percent)	4.05%
Effective interest rate (as a percent)	4.12%
Investment Properties
Annual maturities of mortgage debt
2023-current maturities	$ 228,573
2024	17,137,577
2025	10,246,936
2026	256,664
2027	266,775
Thereafter	138,533,358
Total	166,669,883
Less: unamortized deferred financing costs	(549,925)
Secured Debt	166,119,958		$ 166,230,563
Hamilton Essex 81
Annual maturities of mortgage debt
2025	10,000,000
Total	10,000,000
Less: unamortized deferred financing costs	(41,367)
Secured Debt	9,958,633		9,944,844
345 Franklin
Annual maturities of mortgage debt
2023-current maturities	228,573
2024	237,577
2025	246,936
2026	256,664
2027	266,775
Thereafter	7,533,358
Total	8,769,883
Less: unamortized deferred financing costs	(38,286)
Secured Debt	8,731,598		8,944,849
Hamilton Minuteman
Annual maturities of mortgage debt
Thereafter	6,000,000
Total	6,000,000
Less: unamortized deferred financing costs	(73,311)				$ (123,000)
Secured Debt	5,926,689		5,918,506
Hamilton on Main Apts
Annual maturities of mortgage debt
2024	16,900,000
Total	16,900,000
Less: unamortized deferred financing costs	(30,765)
Secured Debt	16,869,235		16,853,184
Dexter Park
Annual maturities of mortgage debt
Thereafter	125,000,000
Total	125,000,000
Less: unamortized deferred financing costs	(366,196)
Secured Debt	$ 124,633,803		$ 124,569,180	$ 82,000,000

XML

EMPLOYEE BENEFIT 401(k) PLANS (Details)	9 Months Ended
	Sep. 30, 2022 USD ($)
EMPLOYEE BENEFIT 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	$ 70,000

XML

SUBSEQUENT EVENTS (Details)		1 Months Ended				4 Months Ended	9 Months Ended
	Oct. 14, 2022 USD ($)	Nov. 30, 2022 $ / item	Jul. 31, 2022 $ / item	Apr. 30, 2022 $ / item	Jan. 31, 2022 $ / item	Jan. 19, 2023 USD ($) $ / item shares	Sep. 30, 2022 USD ($) $ / item shares	Dec. 12, 2022 USD ($) ft²	Dec. 31, 2021 USD ($) $ / item	Sep. 30, 2021 $ / item	Jun. 30, 2021 $ / item	Mar. 31, 2021 $ / item
Subsequent events
Total cost of repurchase							$ 5,167,667
Units required to be repurchased (in shares) | shares							2,192
Quarterly distribution per unit approved (in dollars per unit) | $ / item			9.60	9.60	9.60
Quarterly distribution per unit (in dollars per unit) | $ / item				0.32	0.32		0.32		0.32	0.32	0.32	0.32
Total property cost							$ 404,296,949		$ 400,588,242
Class B
Subsequent events
Total cost of repurchase							981,249
General Partnership
Subsequent events
Total cost of repurchase							$ 51,645
Subsequent event
Subsequent events
Number of depository receipts repurchased | shares						1,658
Repurchase price of depository receipts (in dollars per receipt) | $ / item						76.58
Price per unit of depository receipts | $ / item						2,297.40
Total cost of repurchase						$ 127,565
Quarterly distribution per unit approved (in dollars per unit) | $ / item		9.60
Quarterly distribution per unit (in dollars per unit) | $ / item		0.32
Subsequent event | Modification agreement with Brookline Bank. | Extending the maturity until October 14, 2032
Subsequent events
Existing loan amount	$ 5,954,546.14
Interest rate (as a percent)	4.60%
Interest only term	2 years
Term of debt	30 years
Debt service coverage ratio	1.35
Threshold percentage of Loan to Value	65.00%
Subsequent event | Modification agreement with Brookline Bank. | Extending the maturity until October 14, 2032 | Maximum
Subsequent events
Additional earnout	$ 1,495,453.86
Subsequent event | Purchase and sale agreement | Property located at 659 Worcester Road, Framingham, MA. | Commercial
Subsequent events
Area of property (in square feet) | ft²								20,700
Total property cost								$ 10,151,000
Purchase deposit								$ 500,000
Subsequent event | Class B
Subsequent events
Units required to be repurchased (in shares) | shares						13
Value of units required to be repurchased						$ 30,154
Subsequent event | General Partnership
Subsequent events
Units required to be repurchased (in shares) | shares						1
Value of units required to be repurchased						$ 1,587