-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Or9OnCL9fFWoKF8tCzIu6laHzCb54b9S9r2XSsM0L+E9cBB06Z8I+tS9h0G5rv/Y oVC/QhOp2gIMfS5XQlO7qQ== 0001012975-02-000336.txt : 20021112 0001012975-02-000336.hdr.sgml : 20021111 20021112165131 ACCESSION NUMBER: 0001012975-02-000336 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20020930 FILED AS OF DATE: 20021112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATLANTIC REALTY TRUST CENTRAL INDEX KEY: 0000948975 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 133849655 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-27198 FILM NUMBER: 02817670 BUSINESS ADDRESS: STREET 1: 747 THIRD AVE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2123551255 MAIL ADDRESS: STREET 1: 747 THIRD AVE CITY: NEW YORK STATE: NY ZIP: 10017 10-Q 1 e92359.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2002 ------------------ 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 0-27562 ------- ATLANTIC REALTY TRUST -------------------------------------------------------- (Exact name of registrant as specified in its charter) Maryland 13-3849655 - --------------------------------------------- --------------------- (State or other jurisdiction of incorporation (I.R.S. Employer- or organization) Identification No.) 747 Third Avenue, New York, New York 10017 (Address of principal executive offices) (Zip Code) 212-702-8561 ----------------------------------------------------- (Registrant's telephone number, including area code) 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 _X_ No ___ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. The number of shares of beneficial interest, par value $.01 per share, outstanding on November 11, 2002 was 3,561,553. INDEX This Quarterly Report on Form 10-Q contains historical information and forward-looking statements. Statements looking forward in time are included in this Form 10-Q pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. They involve known and unknown risks and uncertainties that may cause the Trust's actual results in future periods to be materially different from any future performance suggested herein. In the context of forward-looking information provided in this Form 10-Q and in other reports, please refer to the discussion of risk factors detailed in, as well as the other information contained in, the Trust's Form 10 filed with the Securities and Exchange Commission on March 28, 1996 as well as the Trust's filings with the Securities and Exchange Commission during the past 12 months. PAGE NO. -------- PART I. - FINANCIAL INFORMATION Item 1. Financial Statements................................................3 Consolidated Statements Of Net Assets In Liquidation September 30, 2002 and December 31, 2001.................................3 Consolidated Statements Of Changes In Net Assets In Liquidation - Periods July 1, 2002 through September 30, 2002 and January 1, 2002 through September 30, 2002 and July 1, 2001 through September 30, 2001 and January 1, 2001 through September 30, 2001...............................4 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS...............................5 Item 2. Management's Discussion and Analysis of Financial Condition and Liquidation Activities......................................................8 Item 3. Quantitative and Qualitative Disclosure About Market Risk...........9 Item 4. Controls and Procedures ............................................9 PART II. - OTHER INFORMATION Item 1. Legal Proceedings..................................................10 Item 2. Changes in Securities and Use of Proceeds..........................10 Item 3. Defaults Upon Senior Securities....................................10 Item 4. Submission of Matters to a Vote of Security Holders................10 Item 5. Other Information..................................................10 Item 6. Exhibits and Reports on Form 8-K...................................10 Signatures.................................................................11 2 PART I. - FINANCIAL INFORMATION 1. Financial Statements. ATLANTIC REALTY TRUST AND SUBSIDIARY CONSOLIDATED STATEMENTS OF NET ASSETS IN LIQUIDATION (Liquidation Basis of Accounting)
September 30, 2002 December 31, 2001 ------------------ ----------------- ASSETS Investment in Real Estate ............ $41,620,825 $39,520,375 Cash and Short-Term Investments ...... 25,277,869 23,424,552 Other Assets ......................... 334,125 341,250 ----------- ----------- Total Assets ......................... 67,232,819 63,286,177 ----------- ----------- LIABILITIES Estimated Costs of Liquidation ....... 4,925,285 5,430,048 ----------- ----------- Net Assets in Liquidation ............ $62,307,534 $57,856,129 =========== ===========
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 3 ATLANTIC REALTY TRUST AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS IN LIQUIDATION (Liquidation Basis of Accounting)
For the Period For the Period July 1, 2002 January 1, 2002 to September 30, 2002 to September 30, 2002 --------------------- --------------------- Net Assets in Liquidation Beginning of Period ................... $59,024,440 $57,856,129 Adjustments to Reflect Liquidation Basis of Accounting ....... 3,283,094 4,451,405 ----------- ----------- Net Assets in Liquidation End of Period ... $62,307,534 $62,307,534 =========== =========== For the Period For the Period July 1, 2001 January 1, 2001 to September 30, 2001 to September 30, 2001 --------------------- --------------------- Net Assets in Liquidation Beginning of Period ................... $59,315,034 $58,146,371 Adjustments to Reflect Liquidation Basis of Accounting ....... 681,559 1,850,222 ----------- ----------- Net Assets in Liquidation End of Period ... $59,996,593 $59,996,593 =========== ===========
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 4 ATLANTIC REALTY TRUST AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Organization and Significant Accounting Policies: Atlantic Realty Trust, a Maryland real estate investment trust (the "Trust"), was formed on July 27, 1995 for the purpose of liquidating its interests in real properties, its mortgage loan portfolio and certain other assets and liabilities which were transferred to the Trust from Ramco-Gershenson Properties Trust (formerly named RPS Realty Trust) ("RPS") on May 10, 1996 (the "Spin-Off Transaction"). The Trust adopted the liquidation basis of accounting as of the date of the Spin-Off Transaction based on its originally stated intention to liquidate its assets or merge or combine operations with another real estate entity within eighteen months from the date of the Spin-Off Transaction. The Trust intends to conduct its operations with the intent of meeting the requirements applicable to a real estate investment trust ("REIT") under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the "Code"). As a result, the Trust will have no current or deferred income tax liabilities. In the opinion of management, the accompanying consolidated financial statements, which have not been audited, include all adjustments necessary to present fairly the results for the interim periods. Such adjustments consists only of normal recurring accruals. The consolidated financial statements should be read in conjunction with the annual financial statements and notes thereto included in the Trust's annual report on form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2001. The results of interim periods may not be indicative of the results for the entire year. Liquidation Basis of Accounting As a result of the Spin-Off Transaction, the Trust has adopted the liquidation basis of accounting. The liquidation basis of accounting is appropriate when liquidation appears imminent and the Trust is no longer viewed as a going concern. Under this method of accounting, assets are stated at their estimated net realizable values and liabilities are stated at the anticipated settlement amounts. The valuations presented in the accompanying Consolidated Statements of Net Assets in Liquidation represent the estimates at the dates shown, based on current facts and circumstances, of the estimated net realizable value of the assets and estimated costs of liquidating the Trust. In determining the net realizable values of the assets, the Trust considered each asset's ability to generate future cash flows, offers to purchase received from third parties, if any, and other general market information. Such information was considered in conjunction with operating the Trust's plan for disposition of assets. The estimated costs of liquidation represent the estimated costs of operating the Trust through its anticipated termination. These costs primarily include payroll, consulting and related costs, rent, shareholder relations, legal and auditing. Changes in these costs during the periods presented are reflected in the adjustments to reflect the liquidation basis of accounting. Computations of net realizable value necessitate the use of certain assumptions and estimates. Future events, including economic conditions that relate to real estate markets in general, may differ from those assumed or estimated at the time such computations are made. Because of the inherent uncertainty of valuation when an entity is in liquidation, the amounts ultimately realized from assets disposed and costs incurred to settle liabilities may materially differ from amounts presented. 5 Pursuant to the terms of the Trust's Amended and Restated Declaration of Trust, the Trust was to continue for a period of 18 months from the date of the Spin-Off Transaction, subject to, among certain other things, satisfactory resolution of the RPS Tax Issues (as such term is defined in footnote 5 below). Because the RPS Tax Issues have not yet been satisfactorily resolved, the Trust has continued its business past that date. The Trust cannot currently estimate the timing of the future satisfactory resolution of the RPS Tax Issues. Accordingly, the Trust will continue until there is a final determination of these issues. Consolidation The consolidated financial statements include the accounts of the Trust and its subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation. 2. Investment in Real Estate:
Estimated Net Estimated Net Property Location Realizable Value 9/30/02 (a) Realizable Value 12/31/01 (a) - -------- -------- ---------------------------- ----------------------------- Hylan Shopping Center Staten Island, NY $41,620,825 $39,520,375
- ------------------ (a) Includes estimated cash flows using a disposition period of 9 months. Realized value may differ depending on actual disposition results and time period. (b) The operations of the Trust and the Hylan Shopping Center for the nine months ended September 30, 2002 and the year ended December 31, 2001 are as follows:
Three Months Ended Nine Months Ended Year ended September 30, 2002 September 30, 2002 December 31, 2001 ------------------ ------------------ ----------------- Rental Income ........................... $1,110,976 $3,233,030 $3,998,999 Expense Reimbursements .................. 497,842 1,399,889 1,883,932 Interest from Short-Term Investments..... 73,994 236,601 675,317 Other ................................... 3,698 5,889 39,095 ---------- ---------- ---------- 1,686,510 4,875,409 6,597,343 ---------- ---------- ---------- Operating Property Expenses ............. 599,805 1,753,263 2,145,100 Depreciation ............................ 64,750 194,250 259,000 General and Administrative .............. 462,391 1,267,554 1,491,658 ---------- ---------- ---------- 1,126,946 3,215,067 3,895,758 ---------- ---------- ---------- Net Income .............................. $ 559,564 $1,660,342 $2,701,585 ========== ========== ==========
3. Shares Outstanding: The weighted average number of shares of beneficial interest outstanding for the periods ending September 30, 2002 and December 31, 2001 was 3,561,553. 6 4. Cash and Short-Term Investments: Cash and short-term investments at September 30, 2002 consist primarily of a certificate of deposit at a major New York bank of $24,750,000, purchased with an original maturity of three months or less, bearing interest at a fixed rate of 1.35%. 5. Income Taxes: During the third quarter of 1994, RPS held more than 25% of the value of its gross assets in overnight Treasury Bill reverse repurchase transactions which the IRS may view as non-qualifying assets for the purposes of satisfying an asset qualification test applicable to REITs, based on a Revenue Ruling published in 1977 (the "Asset Issue"). RPS requested that the IRS enter into a closing agreement with RPS that the Asset Issue would not impact RPS' status as a REIT. The IRS declined such request. In February 1995, the IRS initiated an examination of the 1991-1995 income tax returns of RPS (the "RPS Audit" and, together with the Asset Issue, the "RPS Tax Issues"). Based on developments in the law which occurred since 1977, RPS' tax counsel at that time, Battle Fowler LLP, rendered an opinion that RPS' investment in Treasury Bill repurchase obligations would not adversely affect its REIT status. However, such opinion is not binding upon the IRS. In connection with the Spin-Off Transaction, the Trust assumed all tax liability arising out of the RPS Tax Issues (other than liability that relates to events occurring or actions taken by RPS following the date of the Spin-Off Transaction) pursuant to a tax agreement, dated May 10, 1996, by and between RPS and the Trust. Such agreement provides that RPS (now named Ramco-Gershenson Properties Trust), under the direction of four trustees, three of whom are also trustees of the Trust (the "Continuing Trustees") and not the Trust, will control, conduct and effect the settlement of any tax claims against RPS relating to the RPS Tax Issues. Accordingly, the Trust does not have any control as to the timing of the resolution or disposition of any such claims and no assurance can be given that the resolution or disposition of any such claims will be on terms or conditions as favorable to the Trust as if they were resolved or disposed of by the Trust. RPS and the Trust have also received an opinion from Wolf, Block, Schorr and Solis-Cohen LLP (the "Special Tax Counsel") that, to the extent there is a deficiency in RPS distributions arising out of the IRS examination, and provided RPS timely makes a deficiency dividend (i.e. declares and pays a distribution which is permitted to relate back to the year for which each deficiency was determined to satisfy the requirement that a REIT distribute ninety-five percent (95%) of its taxable income), the classification of RPS as a REIT for the taxable years under examination would not be affected. As of September 30, 2002, the Trust has not been required to perform its indemnity obligation with respect to the RPS Tax Issues other than with respect to the payment of legal fees and expenses incurred in connection with the IRS' ongoing examination. On March 1, 1999, the IRS revenue agent conducting the examination issued his examination report (the "Original Revenue Agent's Report") with respect to the tax issues in the RPS Tax Audit, including the RPS Tax Issues. The Original Revenue Agent's Report set forth a number of positions which the IRS examining agent took with respect to the RPS Tax Issues for the years that are subject to the RPS Tax Audit, which Special Tax Counsel to the Continuing Trustees believes are not consistent with applicable law and regulations of the IRS. One of the positions, the acquisition of assets by RPS that could be viewed as non-qualifying assets for REIT purposes, has been addressed in the opinion letter of counsel referred to above. In addition, the IRS revenue agent proposed to disallow the deductions for bad debts and certain other items claimed by RPS in the years under examination. In reaching his conclusion with respect to the deduction for bad debts, the IRS revenue agent disregarded the fact that the values actually obtained for 7 the assets corresponded to the values used by RPS in determining its bad debt deductions. The issuance of the Original Revenue Agent's Report constituted only the first step in the IRS administrative process for determining whether there is any deficiency in RPS' tax liability for the years at issue and any adverse determination by the IRS revenue agent is subject to administrative appeal with the IRS and, thereafter, to judicial review. As noted above, the Original Revenue Agent's Report set forth a number of positions which Special Tax Counsel to RPS and the Trust believe are not consistent with applicable law and regulations of the IRS. RPS filed an administrative appeal (the "Protest") challenging the findings contained in the Original Revenue Agent's Report. The appellate conferee to whom the administrative appeal was assigned reviewed the Original Revenue Agent's Report and the Protest and, rather than considering the appeal further, returned the case to the revenue agent for further factual development. During a meeting with the Special Tax Counsel to the Continuing Trustees, the appellate conferee indicated that, even assuming the assertions in the Original Revenue Agent's Report justified the disallowances, he was required to return the case to the revenue agent because the facts necessary to sustain the assertions in the Report had not been established to the degree necessary to permit the consideration of the case on appeal. In response, the revenue agent requested information in accordance with the directions of the appellate conferee and, although much of the information was examined by the agent previously, RPS responded to the new request. On October 29, 2001, the IRS issued a new Revenue Agent's Report (the "New Revenue Agent's Report") with respect to the issues presented by the Tax Audit. The amount of the proposed adjustments to the taxable income of RPS and the amount of the additional taxes asserted as being due from RPS, for the years under examination in the New Revenue Agent's Report, include all of the amounts included in the Original Revenue Agent's Report. In addition, the IRS has proposed to disallow the loss claimed by RPS on the disposition of the fee title interest in a property (acquired by RPS in 1992 at foreclosure) that was made to an unrelated third-party. This results in the disallowance of a loss claimed by RPS in 1994 in the approximate amount of $1,810,000. The New Revenue Agent's Report asserts additional grounds in support of the disallowance of the RPS bad debt deductions in the years under examination. If all of the positions taken in the New Revenue Agent's Report were to be sustained, RPS, with funds which could be supplied by the Trust, would have to distribute up to approximately $16.5 million to its shareholders, in accordance with the procedures for deficiency dividends, in order to preserve its status as a REIT and could, in addition, be subject to taxes, interest and penalties up to approximately $42.1 million through September 30, 2002. The Trust has been advised that Ramco-Gershenson Properties Trust timely filed a new administrative appeal (the "New Protest") challenging the determinations made. The IRS is considering the New Protest submitted on behalf of the Trust but has not yet made any determination with respect to the arguments presented in the New Protest. 6. Other Assets: Other assets include the estimated interest income from the Trust's short-term investments. Item 2. Management's Discussion and Analysis of Financial Condition and Liquidation Activities. Capital Resources and Liquidity At September 30, 2002, the Trust owned one retail property (Hylan Plaza Shopping Center, located in Staten Island, New York) as well as cash and certain other assets. The Trust does not intend to make new loans or actively engage in either the mortgage lending or the property acquisition business. 8 The Trust's primary objective has been to liquidate its assets in an eighteen-month period from the date of the Spin-Off Transaction while realizing the maximum values for such assets; however because the RPS Tax Issues have not been satisfactorily resolved, the Trust has continued its business beyond such period. Although the Trust considers its assumptions and estimates as to the values and timing of such liquidations to be reasonable, the period of time to liquidate the assets and distribute the proceeds of such assets is subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Trust's control. There can be no assurance that the net values ultimately realized and costs actually incurred for such assets will not materially differ from the Trust's estimates. The Trust believes that cash and cash equivalents on hand, proceeds generated by the real estate property that it owns and operates and proceeds from the eventual sale of such property will be sufficient to support the Trust and meet its obligations. As of September 30, 2002, the Trust had approximately $25,277,000 in cash and short-term investments. Inflation Inflation has been consistently low during the periods presented in the consolidated financial statements and, as a result, has not had a significant effect on the operations on the Trust or its investment. Results of Operations The Trust has increased the Estimated Net Realizable Value of the Hylan Shopping Center during the third quarter based on its increased cash flow and the current interest rate environment. The Trust is in the process of obtaining a current market appraisal, which will be available in the fourth quarter. As a result of the Trust adopting the liquidation basis of accounting in accordance with accounting principles generally accepted in the United States of America as of May 10, 1996 and thus not reporting results of operations thereafter, there is no management discussion comparing the corresponding periods. Item 3. Quantitative and Qualitative Disclosure About Market Risk. Not Applicable. Item 4. Procedure and Controls Within the 90-day period prior to the filing of this quarterly report on Form 10-Q, the Company carried out an evaluation, under the supervision of and with the participation of the Company's management, including the Company's President and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to Exchange Act Rule 13a-14(c) under the Securities Exchange Act of 1934. Based upon that evaluation, the President and Chief Financial Officer concluded that the Company's disclosure controls and procedures are effective. There were no significant changes made in the Company's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation. 9 PART II. - OTHER INFORMATION Item 1. Legal Proceedings. Not applicable. Item 2. Changes in Securities and Use of Proceeds. Not applicable. Item 3. Defaults Upon Senior Securities. Not applicable. Item 4. Submission of Matters to a Vote of Security Holders. None. Item 5. Other Information. Pursuant to the terms of the Trust's Amended and Restated Declaration of Trust, the Trust was to continue for a period of 18 months from the date of the Spin-Off Transaction (which 18-month period ended on November 10, 1997), subject to, among certain other things, satisfactory resolution of the RPS Tax Issues. Because the RPS Tax Issues have not yet been satisfactorily resolved, the Trust has continued its business past that date. The Trust cannot currently estimate the timing of the future satisfactory resolution of the RPS Tax Issues. Accordingly, the Trust will continue until there is a final determination of these issues. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits. None. (b) Reports on Form 8-K. The registrant filed one report on Form 8-K during the most recent three month period ended September 30, 2002. On August 13, 2002, registrant filed a Form 8-K reporting the filing of the June 30, 2002 Form 10-Q and included the certifications required to be filed with the Form 10-Q pursuant to 18 U.S.C. Section 1350. 10 SIGNATURES Pursuant to the requirements 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. ATLANTIC REALTY TRUST (Registrant) Date: November 11, 2002 /s/ Joel M. Pashcow ------------------------------------ Name: Joel M. Pashcow Title: Chairman and President (Principal Executive Officer) Date: November 11, 2002 /s/ Edwin R. Frankel ------------------------------------ Name: Edwin R. Frankel Title: Executive Vice President, Chief Financial Officer and Secretary (Principal Financial and Accounting Officer) 11 CERTIFICATION BY JOEL M. PASHCOW PURSUANT TO SECURITIES EXCHANGE ACT RULE 13A-14 I, Joel M. Pashcow, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Atlantic Realty Trust; 2. Based on my knowledge, this quarterly 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 quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures 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 quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. 12 Date: November 11, 2002 /s/ Joel M. Pashcow ------------------------------------ Name: Joel M. Pashcow Title: Chairman and President (Principal Executive Officer) 13 CERTIFICATION BY EDWIN R. FRANKEL PURSUANT TO SECURITIES EXCHANGE ACT RULE 13A-14 I, Edwin R. Frankel, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Atlantic Realty Trust; 2. Based on my knowledge, this quarterly 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 quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures 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 quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. 14 Date: November 11, 2002 /s/ Edwin R. Frankel ------------------------------------ Name: Edwin R. Frankel Title: Executive Vice President, Chief Financial Officer and Secretary (Principal Financial and Accounting Officer) 15 Exhibit 99.1 TO ATLANTIC REALTY TRUST REPORT ON FORM 10Q SEPTEMBER 30, 2002 CERTIFICATION BY JOEL M. PASHCOW PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 The undersigned, Chairman and President of Atlantic Realty Trust (the "Company"), hereby certifies, to the best of my knowledge, that the Form 10-Q of the Company for the quarter ended September 30, 2002 (the "Periodic Report") accompanying this certification fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78(d)) and that the information contained in the Periodic Report fairly represents, in all material respects, the financial condition and results of operations of the Company. The foregoing certification is incorporated solely for purposes of complying with the provisions of Section 906 of the Sarbanes-Oxley Act and is not intended to be used for any other purpose. Date: November 11, 2002 /s/ Joel M. Pashcow ------------------------------------ Name: Joel M. Pashcow Title: Chairman and President (Principal Executive Officer) -----END PRIVACY-ENHANCED MESSAGE-----