Item 1B. Unresolved Staff Comments
ITEM 1B. UNRESOLVED STAFF COMMENT S
None.
I TEM 1C. CYBERSECURITY
The Partnership’s information technology, communication networks, system applications, accounting and financial reporting platforms and related systems, and those that are offered to residents and tenants, are integral to the operation of the business. The Partnership utilizes these systems, among others, for financial analysis, management, and
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reporting, for facilitation of operations, including for the initiation, generation, and completion of resident leasing, for internal communications, and for various other aspects of the business.
The Partnership’s cybersecurity strategy is focused on detection, protection, incident response, security risk management and mitigation, and resiliency of the cybersecurity infrastructure. The Partnership has implemented or is in the process of continuously evaluating, testing and updating various information security processes and policies designed to identify, assess and manage material risks from cybersecurity threats to the Partnership’s critical computer networks, third-party hosted services, communications systems, hardware and software, and critical data, including confidential information that is proprietary, strategic or competitive in nature, as well as any personally identifiable information related to the Partnership’s residents’ and employees’ personal data.
To operate its business, the Partnership engages certain third-party vendors to perform a variety of functions . The Partnership seeks to engage reliable, reputable service providers. Depending upon the nature of the services and the sensitivity of the data that a third-party service provider processes , the Partnership’s vendor management procedures include reviewing the cybersecurity procedures, imposing contractual requirements, and conducting as needed periodic reassessments. The Partnership seeks to further enhance this review to expand the scope and depth of this analysis.
Cybersecurity is a critical component of our risk management process. We recognize that no single technology, process, or business control can effectively prevent or mitigate all risks, thus we use a variety of tools including multi-factor authentication and antivirus and firewall protection, to help identify, protect, detect, respond to, and recover from cyber threats. These individual technologies work together as part of our strategy to minimize risk. This strategy is tested through audits and independent program assessments, as well as through additional exercises with our Managed Service Provider, designed to assess effectiveness. The Managed Service Provider actively manages our firewalls, multi-factor authentication, antivirus, and Azure environment. Our Managed Service Provider also reviews our cybersecurity program on a quarterly basis and provides recommendations toward best industry practice. Our cybersecurity program is continually evolving to align with NIST standards, and we regularly monitor our progression toward these standards.
Our Audit Committee is responsible for overseeing our cybersecurity and data privacy risks . Our cybersecurity program is led by the Hamilton Company’s Chief Financial Officer , who, along with the Hamilton Company’s Director of Information Technology who has been with Hamilton for 39 years, provide regular updates each quarter to the Audit Committee regarding this program, including information about the cybersecurity threat landscape, investments in infrastructure and opportunities to protect and enhance the Company’s systems and security of products and operations . The also Board receives periodic briefings from management regarding cybersecurity activities and initiatives
The Partnership’s cybersecurity program is designed to safeguard the confidentiality, integrity and availability of data and systems within the Company’s environment to effectively support our business objectives and customer needs. Our commitment to cybersecurity focuses on enhancing our prevention, monitoring, and detection response capabilities to identify and respond to evolving threats. We believe cybersecurity is the responsibility of every employee of the Hamilton Company, and it is prioritized each year. We regularly test, educate, and share best practices with employees of the Hamilton Company to raise awareness of cyber threats through a comprehensive security awareness training program. Our Managed Service Provider is responsible for testing our ability to restore our critical infrastructure on a quarterly basis. Additionally, our incident response and disaster recovery plans are reviewed and updated annually.
During 2024, we have not encountered cybersecurity challenges that have materially impaired our operations, business strategy or financial condition.
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ITEM 2. PROPERTIE S
The Partnership and its Subsidiary Partnerships own the Apartment Complexes, the Condominium Units, the Commercial Properties and a 40-50% interest in seven Investment Properties. See also “Item 13. Certain Relationships and Related Transactions and Director Independence” for information concerning affiliated transactions.
Apartment Complexes
The table below lists the location of the 2,943 Apartment Units, the number and type of units in each complex, the range of rents and vacancies as of February 1, 2025, the principal amount outstanding under any mortgages as of December 31, 2024, the fixed interest rates applicable to such mortgages, and the maturity dates of such mortgages.
Mortgage Balance
and Interest Rate
Maturity
Number and Type
As of
Date of
Apartment Complex
of Units
Rent Range
Vacancies
December 31, 2024
(1)
Mortgage
Boylston Downtown L.P.
268 units
12
$
33,145,648
2028
62 Boylston Street
0 three bedroom
N/A
3.97
%
Boston, MA
0 two bedroom
N/A
53 one bedroom
$
3,250
–
3,400
215 studios
$
2,500
–
2,700
Brookside Associates, LLC
44 units
3
$
6,175,000
2035
5–7–10–12 Totman Road
0 three bedroom
N/A
3.53
%
Woburn, MA
34 two bedroom
$
2,200
–
2,450
10 one bedroom
$
2,000
–
2,300
0 studios
N/A
Clovelly Apartments L.P.
103 units
—
$
11,214,000
2031
160–170 Concord Street
0 three bedroom
N/A
2.97
%
Nashua, NH
53 two bedroom
$
1,725
–
2,050
50 one bedroom
$
1,690
–
1,795
0 studios
N/A
Commonwealth 1137 L.P.
35 units
2
$
5,440,000
2031
1131–1137 Commonwealth Ave.
29 three bedroom
$
2,750
–
4,725
2.97
%
Allston, MA
4 two bedroom
$
2,500
–
3,300
1 one bedroom
$
2,300
–
2,300
1 studio
$
1,600
–
1,600
Commonwealth 1144 L.P.
261 units
10
$
32,325,000
2031
1144–1160 Commonwealth Ave.
0 three bedroom
N/A
2.97
%
Allston, MA
11 two bedroom
$
2,800
–
2,900
109 one bedroom
$
1,600
–
2,925
141 studios
$
1,650
–
2,400
Nera Dean Street Associates, LLC
69 units
2
$
10,322,000
2032
38–48 Dean Street
0 three bedroom
N/A
4.33
%
Norwood, MA
66 two bedroom
$
2,400
–
2,500
3 one bedroom
$
1,975
–
1,975
0 studios
N/A
Executive Apartments L.P.
72 units
1
$
8,190,000
2031
545–561 Worcester Road
1 three bedroom
$
2,525
–
2,525
2.97
%
Framingham, MA
47 two bedroom
$
2,175
–
2,575
23 one bedroom
$
1,825
–
2,075
1 studio
$
1,700
–
1,700
Hamilton Battle Green LLC
48 units
2
$
3,629,770
2026
34–42 Worthen Road
0 three bedroom
N/A
4.95
%
Lexington, MA
24 two bedroom
$
2,650
–
3,150
24 one bedroom
$
2,250
–
2,650
0 studios
N/A
Hamilton Green Apartments LLC
193 units
2
$
31,336,828
2028
311–319 Lowell Street
10 three bedroom
$
3,400
–
4,400
4.67
%
Andover, MA
168 two bedroom
$
2,600
–
2,700
15 one bedroom
$
2,250
–
2,350
0 studios
$
N/A
Hamilton Highlands
79 units
—
$
18,970,055
2026
755-757 Highland Avenue
0 three bedroom
$
–
N/A
3.76
%
Needham,Ma.
76 two bedroom
$
2,850
–
3,400
2 one bedroom
$
2,450
–
2,450
1 studio
$
2,400
–
2,400
Hamilton Oaks Associates, LLC
268 units
7
$
26,666,000
2031
30–50 Oak Street Extension
0 three bedroom
N/A
2.97
%
40–60 Reservoir Street
96 two bedroom
$
2,145
–
2,200
Brockton, MA
159 one bedroom
$
1,875
–
1,925
13 studios
$
1,625
–
1,625
Highland Street Apartments L.P.
36 units
—
$
3,960,000
2031
38–40 Highland Street
0 three bedroom
N/A
2.97
%
Lowell, MA
24 two bedroom
$
1,675
–
1,725
10 one bedroom
$
1,500
–
1,550
2 studios
$
1,425
–
1,425
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Mortgage Balance
and Interest Rate
Maturity
Number and Type
As of
Date of
Apartment Complex
of Units
Rent Range
Vacancies
December 31, 2024
(1)
Mortgage
Linhart L.P.
9 units
1
$
4–34 Lincoln Street
0 three bedroom
N/A
—
%
Newton, MA
0 two bedroom
N/A
5 one bedroom
$
1,850
–
2,250
4 studios
$
1,775
–
1,775
Mill Street Development (2)
—
%
57 Mill Street
Woburn,MA.
Mill Street Gardens, LLC
181 units
3
$
31,000,000
2035
57 Mill Street
0 three bedroom
N/A
3.59
%
Woburn,MA.
116 two bedroom
$
2,950
2,950
62 one bedroom
$
2,150
–
2,150
3 studios
$
1,775
–
1,775
North Beacon 140 L.P.
65 units
4
$
12,683,000
2031
140–154 North Beacon Street
10 three bedroom
$
3,100
–
4,200
2.97
%
Brighton, MA
54 two bedroom
$
3,500
–
3,600
1 one bedroom
$
2,200
–
2,200
0 studios
N/A
Olde English Apartments L.P.
84 units
—
$
9,608,000
2031
703–718 Chelmsford Street
0 three bedroom
N/A
2.97
%
Lowell, MA
47 two bedroom
$
1,750
–
1,800
30 one bedroom
$
1,650
–
1,750
7 studios
$
1,525
–
1,525
Redwood Hills L.P.
180 units
3
$
17,105,000
2031
376-382 Sunderland road
0 three bedroom
N/A
2.97
%
Worcester, MA
89 two bedroom
$
1,950
–
2,500
91 one bedroom
$
1,950
–
2,050
0 studios
N/A
Residences at Captain Parkers LLC
94 units
2
$
20,750,000
2029
125 Worthen Road and Ryder Lane
8 three bedroom
$
3,800
–
5,100
4.05
%
Lexington, MA
48 two bedroom
$
2,850
–
3,900
38 one bedroom
$
2,500
–
2,950
0 studios
N/A
River Drive L.P.
72 units
7
$
9,543,000
2031
3–17 River Drive
0 three bedroom
N/A
2.97
%
Danvers, MA
60 two bedroom
$
1,950
–
2,500
5 one bedroom
$
1,950
–
2,050
7 studios
$
2,000
–
2,150
School Street 9, LLC
184 units
1
$
26,993,000
2032
9 School Street
0 three bedroom
N/A
4.33
%
Framingham, MA
96 two bedroom
$
2,675
–
2,725
88 one bedroom
$
2,175
–
2,200
0 studios
Shawmut Place LLC
52 units
—
$
—
105-117 West Concord St, 473-477 Shawmut Ave,
12 four bedroom
$
3865
–
5500
and 26-30 Rutland St
4 three bedroom
$
3235
–
4600
Boston, MA
13 two bedroom
$
4100
–
4225
23 one bedroom
$
3195
–
3295
0 studios
N/A
WCB Associates, LLC
180 units
1
$
19,266,000
2031
10–70 Westland Street
0 three bedroom
$
N/A
2.97
%
985–997 Pleasant Street
96 two bedroom
$
1,485
–
2,215
Brockton, MA
84 one bedroom
$
1,465
–
1,895
0 studios
N/A
Westgate Apartments, LLC
220 units
1
$
38,475,000
2032
2–20 Westgate Drive
0 three bedroom
N/A
4.33
%
Woburn, MA
110 two bedroom
$
2,050
–
2,550
110 one bedroom
$
1,750
–
2,325
0 studios
N/A
Westgate Apartments Burlington, LLC
20 units
—
$
4,494,000
2032
105–107 Westgate Drive
0 three bedroom
N/A
4.33
%
Burlington, MA
12 two bedroom
$
2,300
–
3,000
8 one bedroom
$
2,000
–
2,200
0 studios
N/A
Woodland Park Partners, LLC
126 units
3
$
21,378,432
2027
264-290 Grove Street
0 three bedroom
N/A
3.79
%
Newton, MA
80 two bedroom
$
1,750
–
2,900
30 one bedroom
$
1,825
–
2,425
16 studios
$
1,635
–
2,300
(1) The mortgage balance is stated before unamortized deferred financing costs.
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(2) Mill Street Development, LLC, was held for development. In December of 2023, the Partnership received 40B approval to construct a 72 unit apartment complex. Management started the construction project in 2024. In order to comply with the permanent financing requirements for a 40B project, Mill Street Development signed a term sheet for a loan of up to $15 million, to be funded upon completion of the development project. In addition, Mill Street Development deposited $75,000 into escrow to comply with the 40B project requirement of a cost certification of total development costs upon completion of the project .
Current free rent concessions would result in an average reduction in unit rents of approximately $3.42 per month per unit. Free rent expense amortized in 2024 was approximately $122,000 compared to approximately $76,000 in 2023.
See Note 5 to the Consolidated Financial Statements for information relating to the mortgages payable of the Partnership and Subsidiary Partnerships.
Condominium Units
The Partnership owns and leases to residential tenants 19 Condominium Units in the metropolitan Boston area of Massachusetts.
The table below lists the location of the 19 Condominium Units, the type of units, the range of rents received by the Partnership for such units, and the number of vacancies as of February 1, 2025.
Mortgage Balance
Number and Type
and Interest Rate
Maturity
of Units Owned
As of
Date of
Condominiums
by Partnership
Rent Range
Vacancies
December 31, 2024
Mortgage
Riverside Apartments
19 units
1
—
—
8–20 Riverside Street
0 three bedroom
N/A
Watertown, MA
12 two bedroom
$
2,125
–
2,600
5 one bedroom
$
2,100
–
2,400
2 studios
$
2,000
–
2,000
Commercial Properties
BOYLSTON DOWNTOWN LP. In 1995, this Subsidiary Partnership acquired the Boylston Downtown property in Boston, Massachusetts (“Boylston”). This mixed-use property includes 15,908 square feet of rentable commercial space. As of February 1, 2025, the commercial space was fully occupied, and the average rent per square foot was $33.15. For mortgage balance, interest rate and maturity date information see “Apartment Complexes” above.
HAMILTON OAKS ASSOCIATES, LLC. The Hamilton Oaks Apartment complex in Brockton, Massachusetts was acquired by the Partnership in December 1999 through Hamilton Oaks Associates, LLC, and includes 6,075 square feet of rentable commercial space, occupied by a daycare center. As of February 1, 2025, the commercial space was fully occupied, and the average rent per square foot was $15.50.The Partnership also rents roof space for a cellular phone antenna at an average rent of approximately $63,000 per year through November 2040. For mortgage balance, interest rate and maturity date information see “Apartment Complexes” above.
LINHART LP. In 1995, the Partnership acquired the Linhart property in Newton, Massachusetts (“Linhart”). This mixed-use property includes 22,200 square feet of rentable commercial space. As of February 1, 2025, the commercial space had vacant square footage of 1,373 square feet, and the average rent per square foot was $26.75.
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NORTH BEACON 140 LP. In 1995, this Subsidiary Partnership acquired the North Beacon property in Boston, Massachusetts. This mixed-use property includes 1,050 square feet of rentable commercial space. The property was fully rented as of February 1, 2025, and the average rent per square foot was $46.20. For mortgage balance, interest rate and maturity date information see “Apartment Complexes” above.
WRF 659 LLC. In 1999, the Partnership acquired the Staples Plaza shopping center in Framingham, Massachusetts. The shopping center consists of 38,268 square feet of rentable commercial space. As of February 1, 2025, this property was fully occupied and the average rent per square foot was $26.33.
HAMILTON LINEWT ASSOCIATES, LLC. In 2007, the Partnership acquired a retail block in Newton, Massachusetts. The property consists of 5,850 square feet of rentable commercial space. As of February 1, 2025, the commercial space was fully occupied and the average rent per square foot was $37.33.
HAMILTON CYPRESS LLC. In 2008, the Partnership acquired a medical office building in Brookline, Massachusetts. The property consists of 17,718 square feet of rentable commercial space. As of February 1, 2025, the space was fully occupied and the average rent per square foot was $38.95.
653 WORCESTER Road LLC. On January 18, 2023, the Partnership purchased a commercial retail property of 20,693 square feet of rentable commercial space located at 653 Worcester Road in Framingham, Massachusetts for the sum of approximately $10,151,000. As of February 1, 2025, the space was fully occupied and the average rent per square foot was $28.25.
SHAWMUT PLACE, LLC. On July 14, 2023, the Partnership purchased a 52 unit mixed use property in the South End neighborhood of Boston, MA comprised of three buildings at 26-30 Rutland Street, 105-117 West Concord Street and 475 Shawmut Avenue, and 3,397 square feet of commercial space for a purchase price of approximately $27,500,000. The commercial space was fully occupied as of February 1, 2025 and the average rent per square foot was $43.02.
The following information is provided for commercial leases :
Total square
Total number
Percentage of
Annual base rent
feet for
of leases
annual base rent
Through December 31,
for expiring leases
expiring leases
expiring
for expiring leases
2025
$
204,081
24,171
23
6
%
2026
513,440
18,467
11
14
%
2027
379,869
11,043
8
11
%
2028
385,816
10,423
4
11
%
2029
480,127
16,639
7
14
%
2030
—
—
—
—
%
2031
—
—
—
—
%
2032
110,600
1,106
1
3
%
2033
—
—
—
—
%
2034
533,784
20,897
2
15
%
Thereafter
947,722
27,140
3
26
%
Totals
$
3,555,439
129,886
59
100
%
Commercial rental income is accounted for using the straight-line method. Approximately 31% of our commercial leases contain rent escalations which range from $0.32 to $2.80 per square foot per year .
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Investment Properties
See Note 15 to the Consolidated Financial Statements for additional information regarding the Investment Properties.
The Partnership has a 50% ownership interest in the properties summarized below:
Mortgage Balance
and Interest Rate
Maturity
Number and Type
As of
Date of
Investment Properties
of Units
Range
Vacancies
December 31, 2024
(1)
Mortgage
345 Franklin, LLC
40 Units
—
$
8,242,892
2028
345 Franklin Street
0 three bedroom
N/A
3.87
%
Cambridge, MA
39 two bedroom
$
3,800
–
4,500
1 one bedroom
$
3,350
–
3,350
0 studios
N/A
Hamilton on Main Apartments, LLC
148 Units
4
$
23,589,000
2034
223 Main Street
0 three bedroom
N/A
5.43
%
Watertown, MA
93 two bedroom
$
2,700
–
2,950
31 one bedroom
$
2,550
–
2,675
24 studios
$
1,810
–
2,400
Hamilton Minuteman, LLC
42 Units
1
$
6,000,000
2031
1 April Lane
0 three bedroom
N/A
3.71
%
Lexington, MA
40 two bedroom
$
2,995
–
3,450
2 one bedroom
$
2,450
–
2,500
0 studios
N/A
Hamilton Essex 81 LLC
49 Units
1
$
10,000,000
2025
Residential
0 three bedroom
N/A
7.00
%
81–83 Essex Street
11 two bedroom
$
3,100
–
3,500
Boston, MA
38 one bedroom
$
2,335
3,500
0 studios
N/A
Hamilton Essex Development LLC
Parking Lot
Commercial
81–83 Essex Street
Boston, MA
Hamilton 1025 LLC
Commercial Building
Commercial
1025 Hancock Street
Quincy,MA
The Partnership has a 40% ownership interest in the property summarized below:
Hamilton Park Towers, LLC
409 Units
7
$
125,000,000
2028
175–185 Freeman Street,
71 three bedroom
$
4,100
–
6,400
3.99
%
Brookline,MA
227 two bedroom
$
3,300
–
4,225
111 one bedroom
$
2,850
–
3,525
0 studios
N/A
Current free rent concessions would result in an average reduction in unit rents of $6.38 per month per unit. Free rent amortized in 2024 was approximately $53,000, compared to $37,000 in 2023.
(1) The mortgage balance is stated before unamortized deferred financing costs.
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345 FRANKLIN, LLC. In November 2001, the Partnership invested approximately $1,533,000 for a 50% ownership interest in a 40-unit apartment building in Cambridge, Massachusetts. In June 2013, the property was refinanced with a 15-year mortgage in the amount of $10,000,000 at 3.87%, interest only for 3 years and is amortized on a 30-year schedule for the balance of the term. The Partnership paid off the prior mortgage of approximately $6,776,000 with the proceeds of the new mortgage. After the refinancing, the property made a distribution of $1,610,000 to the Partnership. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. At December 31, 2024, the balance of this mortgage before unamortized deferred financing costs is approximately $8,243,000. This investment is referred to as 345 Franklin, LLC.
HAMILTON ON MAIN, LLC. In August 2004, the Partnership invested $8,000,000 for a 50% ownership interest in a 280-unit apartment complex located in Watertown, Massachusetts. The total purchase price was $56,000,000. The 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. On August 23, 2023, Hamilton on Main Apartments, LLC (the “Borrower”), a 50% owned joint venture of the Partnership, received notice from KeyBank, as servicer for the lender of a $16,900,000 loan, indicating that the Borrower failed to comply with certain terms of the loan documents pertaining to the transfer of interests in the Borrower that occurred on the occasion of Harold Brown’s death, and that such transfer constitutes an event of default under the loan documents. While the Borrower has disputed that any events of default actually exist, it worked diligently with KeyBank to obtain KeyBank’s consent to the transfer. On March 8, 2024, the Borrower received notice from KeyBank that it was providing ex-post facto consent to the transfer of interest subject to certain conditions being met by the Borrower. The Partnership’s share of costs associated with the transfer of interests in the Borrower was approximately $107,000. On April 18, 2024 the Borrower and KeyBank executed amended loan documents reflecting the transfer of interest in the Borrower. In conjunction with the execution of the amended loan documents, KeyBank provided a courtesy reduction equal to 50% of the transfer fee. In August 2024, the property was refinanced with a 10 year mortgage in the amount of $23,589,000 at 5.425% interest only. The Joint Venture paid off the prior mortgage of approximately $16,900,000 with the proceeds of the new mortgage and distributed $2,000,000 to the Partnership. The costs associated with the refinancing were approximately $243,000. 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 December 31, 2024, the balance of the mortgage before unamortized deferred finance is $23,589,000. The investment is referred to as Hamilton on Main LLC.
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HAMILTON MINUTEMAN, LLC. In September 2004, the Partnership invested approximately $5,075,000 for a 50% ownership interest in a 42-unit apartment complex located in Lexington, Massachusetts. The purchase price was $10,100,000. In October 2004, the Partnership obtained a mortgage on the property in the amount of $8,025,000 and returned $3,775,000 to the Partnership. The Partnership obtained a new 10-year mortgage in the amount of $5,500,000 in January 2007. The interest on the new loan was 5.67% fixed for the ten year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan. This loan required a cash contribution by the Partnership of $1,250,000 in December 2006. On September 12, 2016, the property was refinanced with a 15 year mortgage in the amount of $6,000,000, at 3.71%, interest only. The Joint Venture Partnership paid off the prior mortgage of approximately $5,158,000 with the proceeds of the new mortgage and made a distribution of $385,000 to the Partnership. The cost associated with the refinancing was approximately $123,000. This investment is referred to as Hamilton Minuteman, LLC. At December 31, 2024, the balance on this mortgage before unamortized deferred financing costs is approximately $6,000,000. 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. This investment is referred to as Hamilton Minuteman, LLC.
HAMILTON 1025, LLC. On March 2, 2005, the Partnership invested $2,352,000 for a 50% ownership interest in a 176-unit apartment complex with an additional small commercial building located in Quincy, Massachusetts. The purchase price was $23,750,000. The Partnership sold 127 of the units as condominiums and retained 49 units for long-term investment. The Partnership obtained a new 10-year mortgage in the amount of $5,000,000 on the units to be retained by the Partnership. The interest on the new loan was 5.67% fixed for the 10-year term with interest only payments for five years and amortized over a 30 year period for the balance of the loan term. On July 8, 2016, Hamilton 1025 LLC paid off the outstanding balance of the mortgage balance. The Partnership made a capital contribution of $2,359,500 to Hamilton 1025, LLC for its share of the funds required for the transaction. As of December 31, 2024, all residential units were sold. The Partnership still owns the commercial building. This investment is referred to as Hamilton 1025, LLC.
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HAMILTON ESSEX 81, LLC. On March 7, 2005, the Partnership invested $2,000,000 for a 50% ownership interest in a building comprising 48 apartments, one commercial space and a 50-car surface parking lot located in Boston, Massachusetts. The purchase price was $14,300,000, with a $10,750,000 mortgage. The Partnership planned to operate the building and initiate development of the parking lot. In June 2007, the Partnership separated the parcels, formed an additional limited liability company for the residential apartments and obtained a mortgage on the property. The new limited liability company formed for the residential apartments and commercial space is referred to as Hamilton Essex 81, LLC. In August 2008, the Partnership restructured the mortgages on both parcels at Essex 81 and transferred the residential apartments to Hamilton Essex 81, LLC. On September 28, 2015, Hamilton Essex Development, LLC paid off the outstanding mortgage balance of $1,952,286. The Partnership made a capital contribution of $978,193 to Hamilton Essex Development LLC for its share of the funds required for the transaction. Additionally, the Partnership made a capital contribution of $100,000 to Hamilton Essex 81, LLC. On September 30, 2015, Hamilton Essex 81, LLC obtained a new 10-year mortgage in the amount of $10,000,000, interest only at 2.18% plus the one month Libor rate. The proceeds of the note were used to pay off the existing mortgage of $8,040,719 and the Partnership received a distribution of $978,193 for its share of the excess proceeds. As a result of the distribution, the carrying value of the investment fell below zero. The Partnership will continue to account for this investment using the equity method of accounting. Although the Partnership has no legal obligation, the Partnership intends to fund its share of any future operating deficits if needed. At December 31, 2024, the balance on this mortgage before unamortized deferred financing costs is approximately $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.
HAMILTON PARK TOWERS, LLC. On October 28, 2009 the Partnership invested approximately $15,925,000 in a joint venture to acquire a 40% interest in a residential property located in Brookline, Massachusetts. The property, Hamilton Park Towers, LLC, referred to as Dexter Park, is a 409 unit residential complex. The purchase price was $129,500,000. In order to fund this investment, the Partnership used approximately $8,757,000 of its cash reserves and borrowed approximately $7,168,000 with an interest rate of 6% from HBC Holdings, LLC, an entity owned by Jameson Brown and his affiliates (“HBC”). The term of the loan was four years with a provision requiring payment in whole or in part upon demand by HBC with six months’ notice. The loan was paid in full in April 2012. The original mortgage was $89,914,000 with an interest rate of 5.57% and was to mature in 2019.
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 pursuant to a Guaranty Agreement dated May 31, 2018.
Hamilton Park Towers, LLC 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.
At December 31, 2024, the balance on this mortgage before unamortized deferred financing costs is approximately $125,000,000. This investment, Hamilton Park Towers, LLC, is referred to as Dexter Park.
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ITEM 3. LEGAL PROCEEDING S
The Partnership, the Subsidiary Partnerships, and the Investment Properties and their properties are not presently subject to any material litigation, and, to management’s knowledge, there is not any material litigation presently threatened against them. The properties are occasionally subject to ordinary routine legal and administrative proceedings incident to the ownership of residential and commercial real estate. Some of the legal and other expenses related to these proceedings are covered by insurance and none of these costs and expenses are expected to have a material adverse effect on the Consolidated Financial Statements of the Partnership.
ITEM 4 . MINE SAFETY DISCLOSUR E
Not applicable .
PART II
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.