SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549


FORM 10-Q – QUARTERLY REPORT UNDER SECTION 13 OR 15(d)10-Q/A
OF THE SECURITIES EXCHANGE ACT OF 1934

(Amendment No. 1)

(Mark One)
xQuarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended March 31,June 30, 2012

Or

oTransition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from __________________ to __________________


Commission File Number:0-8952

SB PARTNERS
(Exact name of registrant as specified in its charter)
   
New York 13-6294787
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
   
   
1 New Haven Avenue, Box 3, Suite 102A,102a, Milford, CT. 06460
(Address of principal executive offices) (Zip Code)

(203) 283-9593
(Registrant's telephone number, including area code)
 
 
(Former name, former address and former fiscal year, if changed since last report.)


 
 
 


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.  [X] Yes [ ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  [ X ] Yes   [  ] No


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See definitions of “large accelerated filer”, “accelerated filer”, “non-accelerated filer” and “small reporting company”.in in Rule 12b-2 of the Exchange Act.
[ ] large accelerated filer                                                      [ ] accelerated filer                                           [X][x] non-accelerated filer                                           [filer[ ] small reporting company

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). [ ] Yes  [X] No


APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.  [ ] Yes [ ] No
Not Applicable

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Not Applicable




SB PARTNERSEXPLANATORY NOTE

INDEXThe sole purpose of this Amendment No. 1 to SB Partners’ Quarterly Report on Form 10-Q for the period ending June 30, 2012, filed with the Securities and Exchange Commission on August 14, 2012 (the “Form 10-Q”), is to furnish Exhibit 101 to the Form 10-Q in accordance with Rule 405 of Regulation S-T.  As permitted by Rule 405, Registrant has a 30 day extension to file Exhibit 101, which exhibit provides the financial statements and footnotes from the Form 10-Q formatted in XBRL (eXtensible Business Reporting Language).

Part IFinancial Information
Item 1
Financial Statements
Consolidated Balance Sheets as of March 31, 2012 (unaudited) and December 31, 2011 (audited)
1
Consolidated Statements of Operations (unaudited) for the three months ended March 31, 2012 and 2011
2
Consolidated Statements of Changes in Partners' Deficit (unaudited) for the three months ended March 31, 20123
Consolidated Statements of Cash Flows (unaudited) for the three months ended March 31, 2012 and 20114
Notes to Consolidated Financial Statements (unaudited)5 – 7
Item 2Management's Discussion and Analysis of Financial Condition and Results of Operations8 – 9
Item 3Quantitative and Qualitative Disclosures about Market Risk10
Item 4TControls and Procedures10
Part IIOther Information10
Exhibits 
Signatures11




No other changes have been made to the Form 10-Q.  This Amendment No. 1
ITEM 1. FINANCIAL STATEMENTS


SB PARTNERS      
(A New York Limited Partnership)      
         
CONSOLIDATED BALANCE SHEETS      
    March 31,  December 31, 
    2012  2011 
    (Unaudited)  (Audited) 
         
Assets:        
   Investments -      
 Real estate, at cost      
      Land $1,985,000  $1,985,000 
      Buildings, furnishings and improvements  18,581,164   18,581,164 
      Less - accumulated depreciation  (3,561,096)  (3,437,522)
     17,005,068   17,128,642 
           
 Investment in Sentinel Omaha, LLC, net of reserve        
 for fair value of $6,638,842 and $3,346,444 at        
 March 31, 2012 and December 31, 2011, respectively  -   - 
     17,005,068   17,128,642 
           
   Other Assets -        
 Cash and cash equivalents  374,401   313,717 
 Cash in escrow  500,034   500,034 
 Other   346,052   259,405 
           
  Total assets $18,225,555  $18,201,798 
           
Liabilities:         
 Mortgage note and unsecured loan payable $20,069,570  $20,069,570 
 Accounts payable  367,802   251,024 
 Tenant security deposits  109,627   109,627 
 Accrued expenses  650,459   462,959 
           
  Total liabilities  21,197,458   20,893,180 
           
Partners' Deficit:        
 Units of partnership interest without par value;        
 Limited partner - 7,753 units  (2,953,084)  (2,672,599)
 General partner - 1 unit  (18,819)  (18,783)
           
  Total partners' deficit  (2,971,903)  (2,691,382)
           
  Total liabilities and partners' deficit $18,225,555  $18,201,798 
           
See notes to consolidated financial statements        














to the Form 10-Q speaks as to the original filing date for the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the original Form 10-Q.

 
 
 


2
SB PARTNERS
(A New York Limited Partnership)

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)



   For the Three Months Ended March 31, 
   2012  2011 
Revenues:       
Base rental income $439,312  $435,189 
Other rental income  200,628   204,564 
Interest on short-term investments and other  12   22,783 
          
 
     Total revenues
   639,952   662,536 
          
Expenses:         
Real estate operating expenses  104,744   114,307 
Interest on mortgage notes and unsecured loan payable  272,268   266,572 
Depreciation and amortization  137,596   123,180 
Real estate taxes  149,051   149,030 
Management fees  213,645   164,466 
Other   43,169   37,195 
          
Total expenses  920,473   854,750 
          
Loss from operations  (280,521)  (192,214)
          
Equity in net income of investment  3,292,398   2,005,078 
          
Reserve for value of investment  (3,292,398)  (2,005,078)
          
Net loss  (280,521)  (192,214)
          
Loss allocated to general partner  (36)  (25)
          
Loss allocated to limited partners $(280,485) $(192,189)
          
(Loss) earnings per unit of limited partnership interest        
(basic and diluted)        
          
  Net loss
 $(36.18) $(24.79)
          
Weighted Average Number of Units of Limited        
   Partnership Interest Outstanding  7,753   7,753 
          
          
See notes to consolidated financial statements        





3
SB PARTNERS
(A New York Limited Partnership)

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' DEFICIT
For the Three Months Ended March 31, 2012 (Unaudited)



Limited Partners:               
  Units of Partnership Interest          
                
  Number  Amount  Cumulative Cash Distributions Accumulated Earnings (Losses) Total 
                
Balance, January 1, 2012  7,753   119,968,973   (111,721,586)  (10,919,986)  (2,672,599)
Net loss for the period  -   -   -   (280,485)  (280,485)
Balance, March 31, 2012  7,753  $119,968,973  $(111,721,586) $(11,200,471) $(2,953,084)
                     
General Partner:                    
  Units of Partnership Interest             
                     
  Number  Amount  Cumulative Cash Distributions Accumulated Earnings (Losses) Total 
                     
Balance, January 1, 2012  1   10,000   (26,364)  (2,419)  (18,783)
Net loss for the period  -   -   -   (36)  (36)
Balance, March 31, 2012  1  $10,000  $(26,364) $(2,455) $(18,819)
                     
                     
See notes to consolidated financial statements.             

























4
SB PARTNERS
(A New York Limited Partnership)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)


  For the Three Months Ended March 31, 
  2012  2011 
       
Cash Flows From Operating Activities:      
  Net loss $(280,521) $(192,214)
Adjustments to reconcile net loss to net cash        
provided by (used in) operating activities:        
Equity in net income of investment  (3,292,398)  (2,005,078)
Reserve for fair value of investment  3,292,398   2,005,078 
Depreciation and amortization  137,596   122,589 
Net (increase) decrease in operating assets  (100,669)  37,065 
Net increase (decrease) in accounts payable  116,778   (31,730)
Net increase in accrued expenses  187,500   - 
         
Net cash provided by (used in) operating activites  60,684   (64,290)
         
Net change in cash and cash equivalents  60,684   (64,290)
         
Cash and cash equivalents at beginning of year  313,717   12,932,100 
         
Cash and cash equivalents at end of year $374,401  $12,867,810 
         
         
Supplemental disclosure of cash flow information:        
Cash paid during the year for interest $196,435  $266,572 















5

SB PARTNERS
Notes to Consolidated Financial Statements (Unaudited)

(1) ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
SB Partners, a New York limited partnership, and its subsidiaries (collectively, the "Partnership" or the “Registrant”), have been engaged since April 1971 in acquiring, operating, and holding for investment a varying portfolio of real estate interests.  SB Partners Real Estate Corporation (the "General Partner") serves as the general partner of the Partnership.

The consolidated financial statements included herein are unaudited; however, the information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to a fair presentation of the financial position, results of operations and cash flows for the interim periods.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading.  It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Partnership’s latest annual report on Form 10-K.

The results of operations for the three month period ended March 31, 2012 are not necessarily indicative of the results to be expected for a full year.

For a discussion of the significant accounting and financial reporting policies of the Partnership, refer to the Annual Report on Form 10–K for the year ended December 31, 2011.


(2) INVESTMENTS IN REAL ESTATE
As of March 31, 2012, the Partnership owns an industrial flex property in Maple Grove, Minnesota and a warehouse distribution center in Lino Lakes, Minnesota.  The following is the cost basis and accumulated depreciation of the real estate investments owned by the Partnership at March 31, 2012 and December 31, 2011:


  No. of  Year of   Real Estate at Cost
Type Prop.  Acquisition Description 3/31/2012  12/31/2011 
              
Industrial flex property  1   2002 60,345 sf $5,270,128  $5,270,128 
                  
Warehouse distribution properties  1   2005 226,000 sf  15,296,036   15,296,036 
                  
Total cost           20,566,164   20,566,164 
                  
Less: Accumulated depreciation           (3,561,096)  (3,437,522)
                  
Investment in real estate          $17,005,068  $17,128,642 





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(3)    INVESTMENT IN SENTINEL OMAHA, LLC
In 2007, the Partnership made an investment in the amount of $37,200,000 in Sentinel Omaha, LLC (“Omaha”).  Omaha is a real estate investment company which as of March 31, 2012 owns 21 multifamily properties in 14 markets.  Omaha is an affiliate of the Registrant’s general partner.  The investment represents a 30% ownership interest in Omaha.

The following are the condensed financial statements (000’s omitted) of Omaha as of and for the periods ended March 31, 2012 and December 31, 2011.


   (Unaudited) (Audited)
Balance Sheet March 31, 2012 December 31, 2011
      
Investment in real estate, net $333,700 $321,600
Other assets 15,531 17,595
Debt (321,951) (320,144)
Other liabilities (5,150) (7,896)
Member's Equity $22,130 $11,155
      
   (Unaudited)  
Statement of Operations March 31, 2012  
      
Rent and other income $10,769  
Real estate operating expenses (5,452)  
Other income and expenses (3,774)  
Net unrealized income 9,432  
      
Net income $10,975  





 (4) MORTGAGE NOTES AND UNSECURED LOAN PAYABLE
       Mortgage notes and unsecured loan payable consist of the following non-recourse first liens:



             
      Annual   Net Carrying Amount
   Interest   Installment Amount Due March 31,    December 31,
Property  Rate Maturity Date Payments at Maturity 2012 2011
             
             
Lino Lakes 5.800% October, 2015  $    580,000(a) $ 10,000,000  $ 10,000,000  $ 10,000,000
             
Bank Loan (b):            
Note A               4,069,570       4,069,570
Note B               6,000,000       6,000,000
             
           $ 20,069,570  $ 20,069,570





(a)         Annual installment payments include interest only.
(b)On September 17, 2007, the Partnership entered into a bank loan (the “Loan”) with a bank (“Holder”) in the amount of $22,000,000, which matured on October 1, 2008 and provided for interest only monthly payments based upon LIBOR plus 1.95% and had entered into discussions as to terms for extending the debt on a longer term basis. On April 29, 2011, the Partnership and Holder executed the new loan agreement (“Loan Agreement”) on the following terms:

1)  In connection with the execution of the Loan Agreement, the Partnership was required to make an immediate payment to Holder of $11,930,430, reducing the balance due under the unsecured credit facility to $10,069,570.  The payment was made from proceeds resulting from the sale of 175 Ambassador Drive.  Additional proceeds from the sale were used to pay Holder’s legal and appraisal costs and to fund a reserve account for future tenant improvement and leasing costs, as needed.   The remaining outstanding obligation in the amount of $10,069,570 was divided into two notes (“Note A” and “Note B;” together, the “Notes”).

2)  Note A in the amount of $4,069,570 has a maturity of July 31, 2014.  The Partnership has two 1-year options to extend the maturity if certain conditions are satisfied.  Note A requires monthly payments of accrued interest at an annual fixed rate of 5% until paid in full.  If extended, the Partnership is required to make an additional fixed principal payment of $9,570 on April 1, 2015 and $30,000 monthly thereafter until paid in full.

7
3)  Note B in the amount of $6,000,000 has a maturity date of April 29, 2018.  The Partnership has three 1-year options to extend the maturity date if certain conditions are satisfied.  Note B accrues interest at an annual fixed rate of 5% but only until all interest and principal have been paid in full on Note A.  Thereafter Note B does not accrue any interest.  Payments of interest and principal are deferred until Registrant’s investment in Sentinel Omaha LLC (“Omaha”) pays distributions to the Partnership.  Distributions from Omaha would be used first to pay accrued interest on the Note B obligation, then principal on the Note B obligation.  If there are no distributions from Omaha prior to the Note B maturity, all interest and principal is due at maturity, subject to the above mentioned extensions.

4)  The Notes may be voluntarily prepaid upon notice to the Holder, subject to certain requirements as to the application of payments. The Partnership’s obligations under the Notes may be accelerated upon default.

5)  Until the Partnership’s obligations under the Notes are satisfied in full, the Partnership is required to pay a portion of its net operating income (after payment of certain permitted expenses), and the net proceeds from the sale, transfer or refinancing of its remaining properties and investments, toward the Notes while retaining the other portion to increase cash reserves. While the obligations under the Notes are outstanding the Partnership is precluded from making distributions to its partners.

6)  The Partnership, its general partner and the Holder also entered into a Management Subordination Agreement accruing a portion of the investment management fee payable by the Partnership to its general partner so long as the Notes remain outstanding.  As of March 31, 2012, $370,379 of investment management fees have been accrued and are included in accrued expenses on the balance sheet. As of December 31, 2011, $263,557 of investment management fees have been accrued and are included in accounts payable on the balance sheet.

As additional security for the Partnership’s payment of its obligations under the Loan Agreement, the Partnership, through its wholly-owned subsidiary Eagle IV Realty, LLC, has executed a Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Financing Statement (“Eagle IV Security Agreement”) and a Pledge Agreement (“Eagle IV Pledge Agreement”) in favor of  Holder.  The Eagle IV Security Agreement provides Holder with a security interest on the Partnership’s property located in Maple Grove, Minnesota (“Eagle IV”) of up to $5,000,000.  The Eagle IV Pledge Agreement pledges to Holder the Partnership’s membership interest in Eagle IV Realty, LLC, the direct owner of Eagle IV.   The Partnership has no other debt obligation secured by Eagle IV.  The Loan Agreement also provides for a negative pledge on the Partnership’s remaining properties and investments.



8

ITEM 2.                                                                    MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2012 AND 2011

General

  The consolidated financial statements for the three months ended March 31, 2012 and 2011 reflect the operations of one industrial flex property and one warehouse distribution center as well as a 30% interest in Omaha.

Results of Operations

Total revenues from operations for the three months ended March 31, 2012 decreased $23,000 to approximately $640,000 as compared to approximately $663,000 for the three months ended March 31, 2011.  Total revenues decreased due to decreases in other income and interest income partially offset by an increase in base rental income.  Base rental income increased $4,000 to approximately $439,000 for the three months ended March 31, 2012 as compared to the same period in 2011 due to a scheduled increase in base rent at Registrant’s property located in Maple Grove, MN.  Other income decreased $4,000 to approximately $201,000 for the three months ended March 31, 2012 from approximately $205,000 for the same period in 2011 due to lower expense reimbursement from the tenants at Registrant’s two wholly owned properties.  Interest income decreased due to a decrease in Registrant’s cash reserves.  During 2011, Registrant held the proceeds from the sale of its Naperville, IL property in cash reserves.  These proceeds were used to pay down Registrant’s unsecured credit facility on April 29, 2011.

Net loss from operations increased $89,000 to approximately $281,000 for the three months ended March 31, 2012, as compared to an approximate loss of $192,000 for the three months ended March 31, 2011 due to an increase in operating expenses combined with the aforementioned decrease in revenues.  Total expenses from operations for the three months ended March 31, 2012, increased $65,000 to approximately $920,000 from approximately $855,000 for the three months ended March 31, 2011.  Total operating expenses increased due to higher investment management fees, amortization expense, interest expense and professional fees.  Investment management fees were higher due to the higher fee rate applied to the cash reserves after the reserves were reinvested when they were used to pay down the unsecured credit facility in 2011.  Amortization expense increased due to an increase in deferred finance costs related to the new loan agreement.  Interest expense increased due to a higher interest rate on the new loan partially offset by lower interest due to the pay down of the unsecured credit facility.  Professional fees increased due to increases in legal and accounting fees.

    The Registrant has a 30% non-controlling interest in Omaha that is accounted for at fair value.  The stagnant national economy had a negative effect on rental apartment operations during 2009 and early 2010.  During the latter half of 2010 and 2011, most of Omaha’s markets reported improved although slow job growth and lower unemployment. On April 14, 2010, Omaha executed the fourth amendment to its unsecured loan which reduced the blended interest rate on the loan from LIBOR plus 585 basis points to LIBOR plus 386 basis points as of February 1, 2010.  Additionally, the maturity date of the unsecured loan was extended from May 31, 2011 to May 31, 2012 with an option for an additional one year extension at which time exit fees are to be paid on a portion of any remaining balance of the unsecured loan.  On May 11, 2012, the holder of the unsecured loan extended the maturity date to May 31, 2013. However, Omaha remains precluded from making distributions to its investors until its unsecured loan is paid in full.  In addition, Omaha has certain mortgage maturities due in the next 12 months which are secured by certain of Omaha’s properties. If Omaha does not have funds sufficient to repay these mortgages at maturity, Omaha may need to refinance such indebtedness with new debt financing.  Omaha may be unable to obtain loans sufficient to retire the existing loans. If it is unable to refinance these mortgages on acceptable terms, Omaha may be forced to dispose of properties upon disadvantageous terms.  If prevailing interest rates or general economic conditions result in higher interest rates at a time when the Omaha must refinance its indebtedness, Omaha's interest expense could increase Registrant does not anticipate receiving any distributions from Omaha during the foreseeable future and has reserved 100% of the reported value of its investment in Omaha on the balance sheet. For the three months ended March 31, 2012, Registrant’s income in equity from its investment in Omaha was $3,292,398.  The reserve for value was adjusted in conjunction with recording the income from equity for the quarter ended March 31, 2012.  Registrant reported a net zero income from equity in investment in Omaha for the quarter ended March 31, 2012.
    For additional analysis, please refer to the discussions of the individual properties below.

    This report on Form 10-Q includes statements that constitute "forward looking statements" within the meaning of Section 27(A) of the Securities Act of 1933 and Section 21(E) of the Securities Exchange Act of 1934 and that are intended to come within the safe harbor protection provided by those sections. By their nature, all forward looking statements involve risks and uncertainties as further described in the Registrant’s latest annual report on Form 10-K.  Actual results may differ materially from those contemplated by the forward looking statements.

CRITICAL ACCOUNTING POLICIES

    The Registrant’s critical accounting policies are described in its Annual Report on Form 10-K for the year ended December 31, 2011. There were no significant changes to such policies in 2012. There are no accounting pronouncements or interpretations that have been issued, but not yet adopted, that Registrant believes will have a material impact on its consolidated financial statements.

9
Liquidity and Capital Resources

As of March 31, 2012, the Registrant had cash and cash equivalents of approximately $374,000. These balances are approximately $61,000 higher than cash and cash equivalents held on December 31, 2011. Cash and cash equivalents increased during the three months ended March 31, 2012 due to cash flow generated from operating activities at Registrant’s two wholly owned properties partially offset by interest paid on Registrant’s loan and partnership expenses.

Total outstanding debt at March 31, 2012 consisted of $10,000,000 of a long-term non-recourse first mortgage note secured by real estate owned by the Registrant due in October 2015 and $10,069,570 under a loan agreement with a bank.  The loan agreement consists of Note A in the amount of $4,069,570 which matures July 2014 and Note B in the amount of $6,000,000 which matures April 2018. The Registrant has no other debt except normal trade accounts payable.

Inflation and changing prices during the current period did not significantly affect the markets in which the Registrant conducts its business, or the Registrant's business overall. However, the real estate market continues to suffer through one of its worst debt crises.  Some borrowers still find it difficult to secure debt at acceptable terms as lenders have imposed stricter terms on borrowers.

The Registrant’s properties are expected to generate sufficient cash flow to cover operating and capital improvement costs and other working capital requirements of the Registrant for the foreseeable future.

Eagle Lake Business Center IV (Maple Grove, Minnesota)

Total revenues for the three months ended March 31, 2012 decreased $5,000 to approximately $220,000 from approximately $225,000 for the three months ended March 31, 2011 due to lower other income partially offset by higher base rental income.  Base rental income was higher in 2012 as the tenant received a scheduled rent increase. Other income was lower due to a decrease in operating expense reimbursements from the tenant.  Net income, which includes deductions for depreciation, increased $20,000 for the three months ended March 31, 2012 to approximately $111,000 from approximately $91,000 for the three months ended March 31, 2011 due primarily to lower operating expenses partially offset by lower total revenues.  Operating expenses were lower due to lower repair costs and lower real estate taxes.

435 Park Court (Lino Lakes, Minnesota)

Total revenues for the three months ended March 31, 2012 increased $5,000 to approximately $420,000 as compared to approximately $415,000 for the three months ended March 31, 2011.  Total revenues were higher due to higher real estate tax expense reimbursement from the tenant.  Net income, which includes deductions for interest expense and depreciation, decreased $2,000 for the three months ended March 31, 2012 to approximately $50,000 as compared to approximately $52,000 for the three months ended March 31, 2011.  Net income decreased primarily due to higher operating expenses partially offset by higher total revenues.  Operating expense increased due to higher real estate taxes, insurance and project administration costs.

Investment in Sentinel Omaha, LLC

During 2007, the Registrant acquired a 30% interest in Sentinel Omaha, LLC for $37,200,000.  Total revenues for the three months ended March 31, 2012 were approximately $10,769,000.  Income before net unrealized income was approximately $1,543,000.  Major expenses included approximately $3,716,000 for interest expense, $804,000 for repairs and maintenance, $1,641,000 for payroll and $1,123,000 for real estate taxes. Omaha reported net unrealized income of approximately $9,432,000 resulting in net income of approximately $10,975,000.  For the three months ended March 31, 2012, the Registrant’s equity interest in the income of Omaha was approximately $3,292,000.  However, Registrant continues to reserve 100% of the reported value of Omaha on its balance sheet.  The reserve for value was adjusted in conjunction with recording the equity income for the quarter ended March 31, 2012.  As a result, Registrant reported a net zero income from equity in investment in Omaha for the quarter ended March 31, 2012.  As of March 31, 2012, the Omaha portfolio consisted of 21 multi-family properties located in 14 markets.

    Total revenues for the three months ended March 31, 2011 were approximately $11,265,000.  Income before realized loss and net unrealized incomelosses was approximately $665,000.  Major expenses included approximately $3,932,000 for interest expense, $1,047,000 for repairs and maintenance, $1,700,000 for payroll and $1,228,000 for real estate taxes. Omaha reported net realized losses and unrealized income of approximately $6,019,000.  For the three months ended March 31, 2011, the Registrant’s equity interest in the income of Omaha was approximately $2,005,000.  However, Registrant reserved 100% of the reported value of Omaha on its balance sheet.  The reserve for value was adjusted in conjunction with recording the equity income for the quarter ended March 31, 2011.  As a result, Registrant reported a net zero income from equity in investment in Omaha for the quarter ended March 31, 2011 As of March 31, 2011, the Omaha portfolio consisted of 23 multi-family properties located in 16 markets.


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ITEM 3.

None

ITEM 4.
CONTROLS AND PROCEDURES

(a)The Chief Executive Officer and the Principal Accounting & Financial Officer of the general partner of SB Partners have evaluated the disclosure controls and procedures relating to the Registrant’s Quarterly Report on Form 10-Q for the period ended March 31, 2012 as filed with the Securities and Exchange Commission and have judged such controls and procedures to be effective.

(b)The Chief Executive Officer and the Principal Accounting and Financial Officer of the general partner of SB Partners have evaluated the internal control over financial reporting relating to the Registrant’s Quarterly Report on form 10-Q for the period ended March 31, 2012 and have identified no changes in the Registrant’s internal controls that have materially affected or are reasonably likely to materially affect the Registrant’s internal controls over financial reporting.


PART II – OTHER INFORMATION

ITEM 6.
EXHIBITS

Exhibit No.                                Description

31.1              **                   Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2              **                    Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1              **                   Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2              **                   Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


101                      Interactive data files pursuant to Rule 405 of Regulation S-T;
(i) Consolidated Balance Sheets as of June 30, 2012 and December 31, 2011;
(ii) Consolidated Statements of Operations for the Three and Six months ended
June 30, 2012 and 2011;
(iii) Consolidated Statements of Changes in Partners’ Deficit for the Six months
ended June 30, 2012; and
(iv) Consolidated Statements of Cash Flows for the Six months ended
June 30, 2012 and 2011
(v) Footnotes related to the consolidated financial statements for the period ended June 30, 2012


** These exhibits were previously included in Registrant’s Report on Form 10-Q for the quarterly period ended June 30, 2012, filed with the Securities and Exchange Commission on August 14, 2012.






 
 
 

11
SIGNATURESSIGNATURE

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


  SB PARTNERS
  (Registrant)
   
 By:SB PARTNERS REAL ESTATE CORPORATION
  General Partner
  
Dated: July 2, 2012By:/s/ David Weiner
David Weiner
Chief Executive Officer
Principal Financial & Accounting Officer
Dated: July 2,August 27, 2012By:/s/ John H. Zoeller
  John H. Zoeller
  Chief Financial Officer