Transactions with General Partner and Its Affiliates

3 Months Ended

Mar. 31, 2021

Related Party Transactions [Abstract]

Transactions with General Partner and Its Affiliates

5. TRANSACTIONS WITH GENERAL PARTNER AND ITS AFFILIATES:

Pursuant to the terms of the Permanent Manager Agreement (“PMA”) executed in 1993 and renewed for an additional two-year term as of January 1, 2021, the General Partner receives a base fee (the “Base Fee”) for managing the Partnership equal to four percent of gross receipts, subject initially to a minimum annual Base Fee. The PMA also provides that the Partnership is responsible for reimbursement of the General Partner for office rent and related office overhead (“Expenses”) up to an initial annual maximum of $13,250. Both the Base Fee and Expenses reimbursement are subject to annual Consumer Price Index based adjustments. Effective March 1, 2021, Management has elected to roll back the last five years of CPI increases to their 2016 level and suspend any future CPI adjustments for the base fee. Therefore, the minimum annual Base Fee decreased by 5.54% from the prior year to $272,316. The maximum annual Expenses reimbursement remained the same at $23,256 and any potential future CPI adjustments have been suspended.

For purposes of computing the four percent overall fee paid to the General Partner, gross receipts include amounts recovered in connection with the misappropriation of assets by the former general partners and their affiliates. The fee received by the General Partner from the Partnership on any amounts recovered reduce the four percent minimum fee by that same amount.

Amounts paid and/or accrued to the General Partner and its affiliates for the three-month periods ended March 31, 2021 and 2020 are as follows:

	Incurred for the		Incurred for the
	Three Months Ended March 31, 2021		Three Months Ended March 31, 2020
	(unaudited)		(unaudited)
General Partner
Management fees	$	70,743	$	71,221
Overhead allowance		5,814		5,746
Leasing commissions		222,633		-
Reimbursement for out-of-pocket expenses		2,500		2,500
Cash distribution		531		-
	$	302,221	$	79,467

At March 31, 2021 and December 31, 2020, $223,164 and $718, respectively, was payable to the General Partner. Effective with the six Wendy’s lease amendments on January 1, 2021, the General Partner earned a leasing commission of $222,633 representing 3% of only the first 10 years of a 20 year term and reduced by the unamortized portion of previously earned commissions on the six Wendy’s in the amount of $81,935. The commission was included in accounts payable and accrued expenses as of the end of the quarter. The General Partner will determine the available cash flow throughout 2021 to satisfy the obligation, which will entail installment payments. In no event will the sales commissions on liquidation of these six Wendy’s and the unamortized portion of the above noted commissions, at the sale date, exceed an aggregate commission of 3%.

As of March 31, 2021, Jesse Small, an Advisory Board Member, beneficially owned greater than ten percent of the Partnership’s outstanding limited partnership interests. Amounts paid to Mr. Small for his services as a member of the Advisory Board for the three month periods ended March 31, 2021 and 2020 are as follows:

	Incurred for the Three Month Period ended March 31, 2021		Incurred for the Three Month Period ended March 31, 2020
	(Unaudited)		(Unaudited)
Advisory Board Fees paid	$	875	$	875

At March 31, 2021 and December 31, 2020 there were no outstanding Advisory Board fees accrued and payable to Jesse Small.