EX-13 4 west13b.txt EXHIBIT 13B [LETTERHEAD OF WIEN & MALKIN LLP] November 29, 2002 TO PARTICIPANTS IN 250 WEST 57th ST. ASSOCIATES L.L.C.: We enclose the operating report of the lessee, Fisk Building Associates, for the fiscal year of the lease ended September 30, 2002. The lessee reported profit of $3,088,058 subject to additional rent for the lease year ended September 30, 2002, as against profit of $6,343,859 subject to additional rent for the lease year ended September 30, 2001. Additional rent for the lease year ended September 30, 2002 was $1,920,029. $752,000 was advanced against additional rent so that the balance of additional rent is $1,168,029. Although income of the lessee this lease year increased by approximately $400,000 over the prior year, the lessee expended $2,189,474 in connection with a very favorable new lease for portions of the ground floor, second floor and basement with JP Morgan Chase Bank, consisting of leasing commissions of $939,474 and lease termination fees of $1,250,000, net of a $1,700,000 contri- bution from JP Morgan Chase Bank. The new lease is for 16,892 rentable square and for a term of 15 years commencing August 1, 2002 with annual base rentals starting at $1,396,155 (an average of $82.65 per square foot) graduating to $1,846,415 (an average of $109.31 per square foot) in the eleventh year of the lease, plus escalation rent. Prior tenants were paying a blended rate of $32.95 a square foot including escalation. JP Morgan Chase Bank will receive seven months of free rent and certain rent credits. Wien & Malkin LLP receives an additional payment for supervisory services of 10% of distributions in excess of 15% per annum on the cash invest- ment. After deducting $14,400 for fees and costs relating to the conversion of 250 West 57th Street Associates to a limited liability company, including fee to Wien & Malkin LLP, as approved by the participants, and adding $113,540 in connection with interest earned in prior years on excess mortgage proceeds, $1,267,169 is available for distribution. Accordingly, Wien & Malkin LLP received $126,717 of the additional rent and the balance of $1,140,452 is being distributed to the participants. A check for your share of the additional distribution and the computation of the additional payment to Wien & Malkin LLP and distribution are enclosed. The additional distribution of $1,140,452 represents a return of about 31.68% on the cash investment of $3,600,000. Regular monthly distributions are at the rate of 20% a year, so that distributions for the lease year ended September 30, 2002 were about 51.68% per annum. If you have any question about the enclosed material please communicate with the undersigned. Cordially yours, WIEN & MALKIN LLP By: Stanley Katzman SK/fm Encs. 250 West 57th St. Associates L.L.C. Computation of Additional Payment for Supervisory Services and Distribution For the Lease Year Ended September 30, 2002 Secondary additional rent $1,168,029 Primary additional rent for the lease year ended September 30, 2002 752,000 1,920,029 Add: Additional in connection with interest earned in prior years on excess mortgage proceeds 113,540 $2,033,569 Less: Fees and costs relating to the conversion of 250 West 57th St. Associates to a limited liability company,including fees of $13,325 to Wien & Malkin LLP, as approved by the participants 14,400 $2,019,169 Less: Additional basic payment to Wien & Malkin LLP from primary overage rent 12,000 Total rent to be distributed 2,007,169 Less: 15% return on $3,600,000 investment 540,000 Subject to additional payment at 10% to Wien & Malkin LLP $1,467,169 Additional payment at 10% $ 146,717 Paid to Wien & Malkin LLP as advance for additional rent 20,000 Balance of additional payment to Wien & Malkin LLP $ 126,717 Summary: Additional distribution to participants $1,140,452 Payment to Wien & Malkin LLP, as above 126,717 Total secondary additional rent available for distribution to participants and payment to Wien & Malkin LLP $1,267,169 [LETTERHEAD OF ROGOFF & COMPANY, P.C.] Accountants' Compilation Report Fisk Building Associates 60 East 42nd Street New York, New York 10165 We have compiled the special-purpose statement of income and expense of Fisk Building Associates for the lease year ended September 30, 2002 for the determination of additional rent due to 250 West 57th St. Associates in accordance with paragraph 2 (B) of the lease, as modified, between Fisk Building Associates and 250 West 57th St. Associates. Such report is not intended to be a presentation in conformity with generally accepted accounting principles. Our engagement was conducted in accordance with Statements for Accounting and Review Services issued by the American Institute of Certified Public Accountants. A compilation is limited to presenting, in the form of financial statements, information that is the representation of management. We have not audited or reviewed the accompanying special-purpose financial statement and, accordingly, do not express an opinion or any other form of assurance on it. This report is intended solely for the information and use of the managements of Fisk Building Associates and 250 West 57th Street Associates, and should not be used for any other purpose. New York, New York October 31, 2002 Fisk Building Associates Special Purpose Statement of Income and Expense October 1, 2001 through September 30, 2002 Income: Rent income $12,175,836 Escalation income 821,692 Electric income, net 583,230 Other income 126,338 Total Income $13,707,096 Expenses: Real estate taxes $1,994,450 Labor costs 2,170,376 Repairs, supplies and improvements 1,325,207 Management and leasing 1,616,779 Fuel oil 69,123 Professional fees 782,871 Security 217,765 Security monitor system 61,190 Water 54,474 Insurance 177,375 Rubbish removal 30,617 Telephone 40,521 Advertising 198,916 Miscellaneous 24,075 Lease termination fees 1,250,000 Total expenses before rent expense 10,013,739 Net income before rent expense 3,693,357 Less, Basic rent expense 605,299 Net income subject to primary and secondary additional rent 3,088,058 Less, Primary additional rent 752,000 Net income subject to secondary additional rent $ 2,336,058 Secondary additional rent at 50% $ 1,168,029 Computation of Additional Rent due Landlord: Primary additional rent $ 752,000 Secondary additional rent 1,168,029 Total Additional Rent 1,920,029 Less, Advances against additional rent 767,396* Additional rent due landlord $ 1,152,633 *Consisting of primary additional rent of $752,000 and $15,396 of interest earned and retained by 250 West 57th St. Associates on funds borrowed for the improvement program. See accompanying Accountants' Compilation Report and Selected Information. Fisk Building Associates Selected Information Note 1 -The lease as modified effective October 1, 1984 provides for additional rent, as follows: Additional rent equal to the first $752,000 of the Lessee's net operating income, as defined, in each lease year. Further additional rent equal to 50% of the Lessee's remaining net operating income, as defined, in each lease year.