SEGMENT REPORTING

12 Months Ended

Dec. 31, 2016

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, 2016, 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 for the years ended December 31, 2016 and 2015.

	Year ended December 31, 2016						Year ended December 31, 2015						Year ended December 31, 2014
	Residential		Commercial		Total		Residential		Commercial		Total		Residential		Commercial		Total
	(in thousands)						(in thousands)						(in thousands)
Income from rental operations	$	80,497	$	27,566	$	108,063	$	75,914	$	21,268	$	97,182	$	53,499	$	17,437	$	70,936
Expenses from rental operations		43,766		6,924		50,690		39,898		4,809		44,707		27,794		3,019		30,813
Net operating income	$	36,731	$	20,642	$	57,373	$	36,016	$	16,459	$	52,475	$	25,705	$	14,418	$	40,123
Interest						18,366						17,141						12,958
Depreciation and amortization						22,145						19,574						13,575
Administration of REIT						5,600						5,647						6,824
Loss on impairment of property						—						412						—
Loss on lease terminations						299						—						58
Other (income)/expense						(1,894)						(1,683)						(2,595)
Net income					$	12,857					$	11,384					$	9,303

Segment Assets and Accumulated Depreciation

As of December 31, 2016	Residential		Commercial		Total
	(in thousands)
Real estate investments	$	514,341	$	200,959	$	715,300
Accumulated depreciation		(63,148)		(29,177)		(92,325)
	$	451,193	$	171,782		622,975
Cash and cash equivalents						12,034
Restricted deposits and funded reserves						7,213
Investment in unconsolidated affiliates						3,653
Receivables and other assets						5,354
Financing and lease costs, less accumulated amortization						950
Assets held for sale						2,482
Intangible assets, less accumulated amortization						15,852
Total Assets					$	670,513

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						1,240
Assets held for sale						1,721
Intangible assets, less accumulated amortization						18,184
Total Assets					$	642,375