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RENTAL PROPERTIES

9 Months Ended

Sep. 30, 2011

NOTE 2. RENTAL PROPERTIES

As of September 30, 2011, the Partnership and its Subsidiary Partnerships owned 2,251 residential apartment units in 20 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, 2011, the Partnership and Subsidiary Partnerships owned a commercial shopping center in Framingham, commercial buildings in Newton and Brookline and mixed-use properties in Boston, Brockton and Newton, all in Massachusetts. These properties are referred to collectively as the “Commercial Properties”.

The Partnership also owned a 40% to 50% ownership interest in nine residential and mixed use complexes (the “Investment Properties”) at September 30, 2011 with a total of 799 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, 2011			December 31, 2010			Useful Life
Land, improvements and parking lots	$	27,544,354		$	26,110,238		15—40 years
Buildings and improvements	118,968,208			110,106,179			15—40 years
Kitchen cabinets	4,301,765			3,923,029			5—10 years
Carpets	3,894,476			3,404,951			5—10 years
Air conditioning	887,688			857,375			7—10 years
Laundry equipment	335,099			331,002			5—7 years
Elevators	1,139,296			1,086,140			20 years
Swimming pools	235,242			155,442			10 years
Equipment	2,167,621			1,989,645			5—7 years
Motor vehicles	107,792			107,792			5 years
Fences	41,470			33,970			5—10 years
Furniture and fixtures	1,232,885			924,633			5—7 years
Smoke alarms	132,184			97,840			5—7 years
Total fixed assets	160,988,080			149,128,236
Less: Accumulated depreciation	(61,223,045		)	(56,976,997		)
	$	99,765,035		$	92,151,239

On May 18, 2011, the Partnership sold Avon Street Apartments, a 66 unit residential apartment complex located at 130 Avon Street, Malden, Massachusetts. The sales price was $8,750,000, which resulted in a gain of approximately $7,700,000. The net proceeds of the sale, of approximately $5,444,000 were held by a qualified intermediary in order for the Partnership to structure a tax free exchange in accordance with Section 1031 of the IRS code. This tax free exchange was completed with the purchase of Battle Green Apartments.

On June 1, 2011, the Partnership purchased the Battle Green Apartments, a 48 unit residential apartment complex located at 34-42 Worthen Road, Lexington, Massachusetts. The purchase price was $10,000,000. The Partnership used cash reserves, the proceeds from the sale of Avon Street and borrowed $3,998,573 from Harold Brown, Treasurer of the General Partner to make this purchase. This loan had an interest rate of 6% and was secured by the Partnership’s ownership interest in Battle Green Apartments, LLC. The term of the loan is four years with a provision requiring payment in whole or in part upon demand within six months of notice or prepay without penalty. On July 27, 2011, the Partnership financed the Battle Green Apartments with a new $5,000,000 mortgage at 4.95% which matures in August 2026. Principal payments will be made using a 30 year amortization schedule. Deferred financing costs associated with this mortgage totaled approximately $90,000 and accordingly the effective interest rate is 5.07%. After paying off the existing loan of $3,998,573, approximately $1,000,000 was received by the Partnership. The interest paid on this loan to Harold Brown was $38,123.