SEGMENT REPORTING

12 Months Ended

Dec. 31, 2015

SEGMENT REPORTING

SEGMENT REPORTING

NOTE 3 – segment reporting

We report our results in two reportable segments: residential and commercial properties. Our residential properties include multifamily properties. Our commercial properties include retail, office, industrial, restaurant and medical properties. We assess and measure operating results based on net operating income (“NOI”), which we define as total real estate segment revenues less real estate expenses (which consist of real estate taxes, property management fees, utilities, repairs and maintenance, insurance and direct administrative costs). We believe NOI is an important measure of operating performance even though it should not be considered an alternative to net income or cash flow from operating activities. NOI is unaffected by financing, depreciation, amortization, legal and professional fees and certain general and administrative expenses.  The accounting policies of each segment are consistent with those described in Note 2 of this report.

Segment Revenues and Net Operating Income

The revenues and net operating income for the reportable segments (residential and commercial) are summarized as follows for the years ended December 31, 2015 and 2014, along with reconciliations to the consolidated financial statements. Segment assets are also reconciled to Total Assets as reported in the consolidated financial statements.

Year ended December 31, 2015	Residential		Commercial		Total
	(in thousands)
Income from rental operations	$	75,914	$	21,268	$	97,182
Expenses from rental operations		39,898		4,809		44,707
Net operating income	$	36,016	$	16,459	$	52,475
Interest						16,475
Depreciation and amortization						20,240
Administration of REIT						5,647
Loss on impairment of property						412
Other (income)/expense						(1,683)
Net income					$	11,384

Year ended December 31, 2014	Residential		Commercial		Total
	(in thousands)
Income from rental operations	$	53,499	$	17,437	$	70,936
Expenses from rental operations		27,794		3,019		30,813
Net operating income	$	25,705	$	14,418	$	40,123
Interest						12,495
Depreciation and amortization						14,038
Administration of REIT						6,824
Loss on lease termination						58
Other (income)/expense						(2,595)
Net income					$	9,303

Segment Assets and Accumulated Depreciation

As of December 31, 2015	Residential		Commercial		Total
	(in thousands)
Real estate investments	$	472,129	$	197,355	$	669,484
Accumulated depreciation		(50,668)		(24,307)		(74,975)
	$	421,461	$	173,048		594,509
Cash and cash equivalents						6,461
Restricted deposits and funded reserves						6,115
Investment in unconsolidated affiliates						9,022
Receivables and other assets						5,123
Financing  and lease costs, less accumulated amortization						4,621
Assets held for sale						1,721
Intangible assets, less accumulated amortization						18,184
Total Assets					$	645,756

As of December 31, 2014	Residential		Commercial		Total
	(in thousands)
Real estate investments	$	438,609	$	152,527	$	591,136
Accumulated depreciation		(38,729)		(20,144)		(58,873)
	$	399,880	$	132,383		532,263
Cash and cash equivalents						643
Restricted deposits and funded reserves						6,732
Investment in unconsolidated affiliates						9,081
Receivables and other assets						5,319
Financing  and lease costs, less accumulated amortization						3,761
Intangible assets, less accumulated amortization						9,222
Total Assets					$	567,021