SEGMENT REPORTING

9 Months Ended

Sep. 30, 2022

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 property administrative and management fees). 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 three and nine months ended September 30, 2022 and 2021, along with reconciliations to the consolidated financial statements. Segment assets are also reconciled to Total Assets as reported in the consolidated financial statements.

	Three months ended September 30, 2022						Three months ended September 30, 2021
	Residential		Commercial		Total		Residential		Commercial		Total
	(in thousands)						(in thousands)
Income from rental operations	$	29,226	$	5,305	$	34,531	$	27,838	$	5,215	$	33,053
Expenses from rental operations		16,211		1,717		17,928		15,352		2,321		17,673
Net operating income	$	13,015	$	3,588	$	16,603	$	12,486	$	2,894	$	15,380
Depreciation and amortization						6,120						5,551
Interest						5,081						4,671
Administration of REIT						1,471						1,007
Other income						(6,385)						(1,567)
Net income					$	10,316					$	5,718

	Nine months ended September 30, 2022						Nine months ended September 30, 2021
	Residential		Commercial		Total		Residential		Commercial		Total
	(in thousands)						(in thousands)
Income from rental operations	$	85,222	$	16,042	$	101,264	$	80,028	$	16,708	$	96,736
Expenses from rental operations		47,964		4,945		52,909		42,564		5,515		48,079
Net operating income	$	37,258	$	11,097	$	48,355	$	37,464	$	11,193	$	48,657
Depreciation and amortization						17,865						16,634
Interest						14,882						13,261
Administration of REIT						4,087						3,267
Other income						(9,291)						(4,337)
Net income					$	20,812					$	19,832

Segment Assets and Accumulated Depreciation

As of September 30, 2022	Residential		Commercial		Total
	(in thousands)
Real estate investments	$	728,010	$	193,649	$	921,659
Accumulated depreciation		(144,226)		(46,790)		(191,016)
Total real estate investments, net	$	583,784	$	146,859	$	730,643
Lease intangible assets, less accumulated amortization		209		5,347		5,556
Cash and cash equivalents						20,464
Restricted deposits						9,267
Investment in securities						42,062
Investment in unconsolidated affiliates						26,176
Notes receivable						7,749
Other assets, net						25,868
Total Assets					$	867,785

As of December 31, 2021	Residential		Commercial		Total
	(in thousands)
Real estate investments	$	692,722	$	203,980	$	896,702
Accumulated depreciation		(133,100)		(46,055)		(179,155)
Total real estate investments, net	$	559,622	$	157,925	$	717,547
Lease intangible assets, less accumulated amortization		—		6,246		6,246
Cash and cash equivalents						51,507
Restricted deposits						9,149
Investment in unconsolidated affiliates						18,658
Notes receivable						7,457
Other assets, net						10,302
Total Assets					$	820,866