(Mark One) | ||
ý | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the fiscal year ended September 30, 2016 | ||
Or | ||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Massachusetts (State or other jurisdiction of incorporation or organization) | 13-2755856 (I.R.S. employer identification no.) | |
60 Cutter Mill Road, Great Neck, New York (Address of principal executive offices) | 11021 (Zip Code) |
Title of each class | Name of each exchange on which registered | |
Shares of Beneficial Interest, $3.00 Par Value | New York Stock Exchange |
Large accelerated filer o | Accelerated filer ý | Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company o |
Item No. | Page(s) | |
PART I | ||
1 | ||
1A. | ||
1B. | ||
2 | ||
3 | ||
4 | ||
PART II | ||
5 | ||
6 | ||
7 | ||
7A. | ||
8 | ||
9 | ||
9A. | ||
9B. | ||
PART III | ||
10 | ||
11 | ||
12 | ||
13 | ||
14 | ||
PART IV | ||
15 | ||
16 | ||
• | factors described in this Annual Report on Form 10-K, including those set forth under the captions "Risk Factors" and "Business"; |
• | our acquisition strategy, which may not produce the cash flows or income expected; |
• | competition could adversely affect our ability to acquire properties; |
• | competition could limit our ability to lease apartments or increase or maintain rental income; |
• | losses from catastrophes may exceed all insurance coverage; |
• | a limited number of multi-family property acquisition opportunities acceptable to us; |
• | national and local economic and business conditions; |
• | general and local real estate property market conditions; |
• | the condition of Fannie Mae or Freddie Mac, which could adversely impact us; |
• | our failure to comply with laws, including those requiring access to our properties by disabled persons, which could result in substantial costs; |
• | insufficient cash flows, which could limit our ability to make required payments on our debt obligations; |
• | an inability to renew, repay, or refinance our outstanding debt; |
• | limitation of credit by institutional lenders; |
• | impairment in the value of real estate property we own; |
• | failure of property managers to properly manage properties; |
• | disagreements with, or misconduct by, joint venture partners; |
• | changes in national and local government policies; |
• | increases in real estate taxes at properties we acquire due to such acquisitions or other factors; |
• | changes in Federal, state and local governmental laws and regulations; |
• | changes in interest rates; and |
• | the availability of and costs associated with sources of capital and liquidity. |
Property Name and Location | Number of Units | Age(1) | Acquisition Date | Our Percentage Ownership (%) | Average Monthly Rental Rate per Occupied Unit 2016 (2)($) | Average Monthly Rental Rate per Occupied Unit 2015 (2)($) | Average Monthly Rental Rate per Occupied Unit 2014 (2)($) | Average Monthly Rental Rate per Occupied Unit 2013 (2)($) | ||||||||
The Fountains Apartments—Palm Beach Gardens, FL(3) | 542 | 45 | 3/22/2012 | 80 | 1,239 | 1,169 | 1,050 | 1,000 | ||||||||
Waverly Place Apartments—Melbourne, FL(3) | 208 | 29 | 3/30/2012 | 80 | 866 | 798 | 722 | 655 | ||||||||
Silvana Oaks Apartments—N. Charleston, SC | 208 | 6 | 10/4/2012 | 100 | 1,077 | 998 | 970 | 903 | ||||||||
Avondale Station—Decatur, GA | 212 | 62 | 11/19/2012 | 100 | 920 | 852 | 776 | 708 | ||||||||
Spring Valley Apartments—Panama City, FL(6) | 160 | 29 | 1/11/2013 | 80 | 849 | 807 | 760 | 699 | ||||||||
Stonecrossing Apartments—Houston, TX(3) | 240 | 38 | 4/19/2013 | 91 | 906 | 884 | 856 | 832 | ||||||||
Pathways—Houston, TX(3) | 144 | 37 | 6/7/2013 | 91 | 909 | 886 | 823 | 791 | ||||||||
Autumn Brook Apartments—Hixon, TN(6) | 156 | 27 | 6/25/2013 | 75 | 795 | 756 | 746 | 743 | ||||||||
Ashwood Park — Pasadena, TX(3) | 144 | 32 | 10/15/2013 | 80 | 746 | 696 | 642 | 632 | ||||||||
Meadowbrook Apartments—Humble, TX(3) | 260 | 34 | 10/15/2013 | 80 | 757 | 705 | 641 | 659 | ||||||||
Parkside Apartments—Humble, TX(3) | 160 | 33 | 10/15/2013 | 80 | 781 | 734 | 669 | 690 | ||||||||
Brixworth at Bridge Street—Huntsville, AL | 208 | 31 | 10/18/2013 | 80 | 688 | 655 | 650 | 668 | ||||||||
Newbridge Commons—Columbus, OH | 264 | 17 | 11/21/2013 | 100 | 762 | 729 | 691 | 684 | ||||||||
Waterside at Castleton—Indianapolis, IN | 400 | 33 | 1/21/2014 | 80 | 642 | 621 | 609 | — | ||||||||
Southridge—Greenville, SC(4) | 350 | 1 | 1/31/2014 | 74 | 1,255 | N/A | N/A | — | ||||||||
Crossings of Bellevue—Nashville, TN | 300 | 31 | 4/2/2014 | 80 | 1,032 | 955 | 907 | — | ||||||||
Sandtown Vista—Atlanta, GA(6) | 350 | 6 | 6/26/2014 | 80 | 922 | 847 | 817 | — | ||||||||
Kendall Manor—Houston, TX | 272 | 35 | 7/8/2014 | 80 | 833 | 796 | 769 | — | ||||||||
Avalon Apartments—Pensacola, FL | 276 | 8 | 12/22/2014 | 98 | 970 | 912 | — | — | ||||||||
Apartments at Venue—Valley, AL | 618 | 5 | 7/27/2015 | 61 | 724 | 715 | — | — | ||||||||
Parkway Falls—San Marcos, TX | 192 | 2 | 9/10/2015 | 80 | 998 | 852 | — | — | ||||||||
Cedar Lakes - Lake St. Louis, MO | 420 | 30 | 9/25/2015 | 80 | 788 | 715 | — | — | ||||||||
Factory at GARCO Park—N. Charleston, SC(5) | 271 | N/A | 10/13/2015 | 65 | N/A | N/A | — | — | ||||||||
Woodland Trails—LaGrange, GA | 236 | 7 | 11/18/2015 | 100 | 832 | 849 | — | — | ||||||||
Cinco Ranch— Katy, TX | 268 | 8 | 1/22/2016 | 75 | 1,177 | — | — | — | ||||||||
River Place — Macon, GA | 240 | 28 | 2/1/2016 | 80 | 622 | — | — | — | ||||||||
Civic Center I—Southaven, MS | 392 | 14 | 2/29/2016 | 60 | 825 | — | — | — | ||||||||
Shavano Park— San Antonio, TX | 288 | 2 | 5/6/2016 | 65 | 953 | — | — | — | ||||||||
Chatham Court— Dallas, TX | 494 | 31 | 5/11/2016 | 50 | 813 | — | — | — | ||||||||
Waters Edge— Columbia, SC | 204 | 20 | 5/31/2016 | 80 | 821 | — | — | — | ||||||||
Lenox Park— Atlanta, GA | 271 | 27 | 8/15/2016 | 74 | 1,190 | — | — | — | ||||||||
Civic Center II — Southaven, MS | 384 | 10 | 9/1/2016 | 60 | 879 | — | — | — | ||||||||
Verandas at Alamo Ranch—San Antonio, TX | 288 | 1 | 9/19/2016 | 72 | 974 | — | — | — | ||||||||
Total | 9,420 |
(3) | Ashwood Park, Meadowbrook Apartments and Parkside Apartments are owned by one joint venture, Waverly Place Apartments and The Fountains Apartments are owned by one joint venture and Stonecrossing Apartments and Pathways are owned by one joint venture. |
(4) | A ground up project we developed with a joint venture partner. We sold this property in October 2016 during its lease-up phase. |
(6) | This property was sold subsequent to September 30, 2016. |
Property Name and Location | Number of Units | Age(1) | Acquisition Date | Average Physical Occupancy in 2016 (%) (2) | Average Physical Occupancy in 2015 (%) (2) | Average Physical Occupancy in 2014 (%) (2) | Average Physical Occupancy in 2013 (%) (2) | |||||||
The Fountains Apartments—Palm Beach Gardens, FL(3) | 542 | 45 | 3/22/2012 | 96.0 | 96.3 | 96.6 | 94.9 | |||||||
Waverly Place Apartments—Melbourne, FL(3) | 208 | 29 | 3/30/2012 | 97.9 | 94.0 | 95.9 | 96.1 | |||||||
Silvana Oaks Apartments—N. Charleston, SC | 208 | 6 | 10/4/2012 | 93.3 | 93.6 | 93.4 | 93.1 | |||||||
Avondale Station—Decatur, GA | 212 | 62 | 11/19/2012 | 94.6 | 97.1 | 96.8 | 96.0 | |||||||
Spring Valley Apartments—Panama City, FL(6) | 160 | 29 | 1/11/2013 | 95.4 | 96.9 | 95.2 | 94.7 | |||||||
Stonecrossing Apartments—Houston, TX(3) | 240 | 38 | 4/19/2013 | 92.1 | 93.5 | 94.3 | 96.8 | |||||||
Pathways—Houston, TX(3) | 144 | 37 | 6/7/2013 | 89.8 | 92.6 | 93.7 | 96.6 | |||||||
Autumn Brook Apartments—Hixon, TN(6) | 156 | 27 | 6/25/2013 | 93.2 | 95.1 | 95.4 | 96.4 | |||||||
Ashwood Park — Pasadena, TX(3) | 144 | 32 | 10/15/2013 | 95.8 | 96.5 | 95.0 | 97.2 | |||||||
Meadowbrook Apartments—Humble, TX(3) | 260 | 34 | 10/15/2013 | 94.4 | 95.0 | 94.6 | 96.0 | |||||||
Parkside Apartments—Humble, TX(3) | 160 | 33 | 10/15/2013 | 93.0 | 95.5 | 93.9 | 92.5 | |||||||
Brixworth at Bridge Street—Huntsville, AL | 208 | 31 | 10/18/2013 | 96.8 | 93.7 | 93.3 | 86.1 | |||||||
Newbridge Commons—Columbus, OH | 264 | 17 | 11/21/2013 | 96.9 | 95.4 | 90.5 | 87.0 | |||||||
Waterside at Castleton—Indianapolis, IN | 400 | 33 | 1/21/2014 | 94.1 | 92.1 | 90.7 | — | |||||||
Southridge—Greenville, SC(4) | 350 | 1 | 1/31/2014 | 62.8 | N/A | N/A | — | |||||||
Crossings of Bellevue—Nashville, TN | 300 | 31 | 4/2/2014 | 97.8 | 97.1 | 97.9 | — | |||||||
Sandtown Vista—Atlanta, GA(6) | 350 | 6 | 6/26/2014 | 94.7 | 95.4 | 92.8 | — | |||||||
Kendall Manor—Houston, TX | 272 | 35 | 7/8/2014 | 93.9 | 94.4 | 91.2 | — | |||||||
Avalon Apartments—Pensacola, FL | 276 | 8 | 12/22/2014 | 91.9 | 90.9 | — | — | |||||||
Apartments at Venue—Valley, AL | 618 | 5 | 7/27/2015 | 90.3 | 93.4 | — | — | |||||||
Parkway Falls—San Marcos, TX | 192 | 2 | 9/10/2015 | 93.6 | 95.3 | — | — | |||||||
Cedar Lakes - Lake St. Louis, MO | 420 | 30 | 9/25/2015 | 91.9 | 93.4 | — | — | |||||||
Factory at GARCO Park—N. Charleston, SC(5) | 271 | N/A | 10/13/2015 | N/A | N/A | — | — | |||||||
Woodland Trails—LaGrange, GA | 236 | 7 | 11/18/2015 | 94.6 | 96.2 | — | — | |||||||
Cinco Ranch— Katy, TX | 268 | 8 | 1/22/2016 | 90.5 | — | — | — | |||||||
River Place — Macon, GA | 240 | 28 | 2/1/2016 | 97.2 | — | — | — | |||||||
Civic Center I—Southaven, MS | 392 | 14 | 2/29/2016 | 97.7 | — | — | — | |||||||
Shavano Park— San Antonio, TX | 288 | 2 | 5/6/2016 | 83.4 | — | — | — | |||||||
Chatham Court— Dallas, TX | 494 | 31 | 5/11/2016 | 93.4 | — | — | — | |||||||
Waters Edge— Columbia, SC | 204 | 20 | 5/31/2016 | 94.2 | — | — | — | |||||||
Lenox Park— Atlanta, GA | 271 | 27 | 8/15/2016 | 94.0 | — | — | — | |||||||
Civic Center II — Southaven, MS | 384 | 10 | 9/1/2016 | 97.4 | — | — | — | |||||||
Verandas at Alamo Ranch—San Antonio, TX | 288 | 1 | 9/19/2016 | 85.8 | — | — | — | |||||||
Total | 9,420 |
(3) | Ashwood Park, Meadowbrook Apartments and Parkside Apartments are owned by one joint venture, Waverly Place Apartments and The Fountains Apartments are owned by one joint venture and Stonecrossing Apartments and Pathways are owned by one joint venture. |
(4) | A ground up project we developed with a joint venture partner. We sold this property in October 2016 during its lease-up phase. |
(6) | This property was sold subsequent to September 30, 2016. |
State | Number of Properties | Number of Units | Estimated 2017 Revenue(1) | Percent of 2017 Estimated Revenue | |||||||||
Texas | 11 | 2,750 | $ | 29,265 | 32.9 | % | |||||||
Florida | 4 | 1,186 | 14,076 | 15.9 | % | ||||||||
Georgia | 5 | 1,309 | 11,123 | 12.5 | % | ||||||||
Mississippi | 2 | 776 | 8,166 | 9.2 | % | ||||||||
Alabama | 2 | 826 | 6,966 | 7.8 | % | ||||||||
South Carolina | 4 | 1,033 | 5,689 | 6.4 | % | ||||||||
Tennessee | 2 | 456 | 4,065 | 4.6 | % | ||||||||
Missouri | 1 | 420 | 3,854 | 4.3 | % | ||||||||
Indiana | 1 | 400 | 3,152 | 3.6 | % | ||||||||
Ohio | 1 | 264 | 2,440 | 2.8 | % | ||||||||
Total | 33 | 9,420 | $ | 88,796 | 100 | % |
(1) | Reflects our estimate of the rental and other revenues to be generated in 2017 by our multi-family properties located in such state. Excludes the effect of property acquisitions and dispositions that occurred after September 30, 2016. |
Location | Purchase Date | No. of Units | Purchase Price | Acquisition mortgage debt | Initial BRT Equity | Ownership Percentage(%) | Property Acquisition Costs | |||||||||||||||||
Fredricksburg, VA | 11/4/2016 | 220 | $ | 38,490 | $ | 29,940 | $ | 8,720 | 80 | % | $ | 643 | ||||||||||||
Columbia, SC | 11/10/2016 | 374 | 58,300 | 41,000 | 5,670 | 32 | % | 71 | ||||||||||||||||
Columbia, SC (1) | 11/10/2016 | 339 | 5,915 | — | 8,665 | 46 | % | — | ||||||||||||||||
933 | $ | 102,705 | $ | 70,940 | $ | 23,055 | $ | 714 |
• | Class B or better properties with strong and stable cash flows in markets where we believe there exists opportunity for rental growth and with potential for further value creation; |
• | Class B or better properties that offer significant potential for capital appreciation through repositioning or rehabilitating the asset to drive rental growth; |
• | properties available at opportunistic prices providing an opportunity for a significant appreciation in value; and |
• | development of Class A properties in markets where we believe we can generate significant returns from the operation and if appropriate, sale of the development. |
Property Name and Location | Sale Date | No. of Units | Sales Price | Gain on Sale | Non-controlling partner's share of the gain | ||||||||||||
New York, NY(1) | 10/1/2015 | 1 | $ | 652 | $ | 609 | — | ||||||||||
Grove at Trinity Pointe - Cordova, TN | 3/2/2016 | 464 | 31,100 | 6,764 | $ | 2,195 | |||||||||||
Mountain Park Estates - Kennesaw, GA | 3/15/2016 | 450 | 64,000 | 17,429 | 10,037 | ||||||||||||
Courtney Station - Pooler, GA | 4/6/2016 | 300 | 38,500 | 5,710 | 1,405 | ||||||||||||
Madison at Schilling Farms - Collierville, TN | 6/1/2016 | 324 | 34,300 | 4,586 | 917 | ||||||||||||
Village Green - Little Rock, AK (2) | 6/6/2016 | 172 | 2,372 | 386 | — | ||||||||||||
Sundance - Wichita, KS | 9/1/2016 | 496 | 30,400 | 10,718 | 4,149 | ||||||||||||
New York, NY(1) | 9/30/2016 | 1 | 725 | 662 | — | ||||||||||||
2,208 | $ | 202,049 | $ | 46,864 | $ | 18,703 |
Property Name and Location | Sale Date | No. of Units | Sales Price | Estimated Gain on Sale | Non-controlling partner's share of the estimated gain | ||||||||||||
Southridge - Greenville, SC | 10/19/2016 | 350 | $ | 68,000 | $ | 18,937 | $ | 9,669 | |||||||||
Spring Valley - Panama City, FL(1) | 10/26/2016 | 160 | 14,720 | 7,390 | 3,732 | ||||||||||||
Sandtown Vistas - Atlanta, GA | 11/21/2016 | 350 | 36,750 | 8,796 | 4,046 | ||||||||||||
Autumn Brook - Hixson, TN(1) | 11/30/2016 | 156 | 10,775 | 479 | 120 | ||||||||||||
1,016 | $ | 130,245 | $ | 35,602 | $ | 17,567 |
• | a preferred return of 10% on each party's unreturned capital contributions, until such preferred return has been paid in full, |
• | the return in full of each party's capital contribution, and |
• | the remaining net cash flow is distributed based upon satisfaction of performance hurdles which vary by transaction. |
YEAR | Principal Payments Due | ||||
2017 | $ | 5,650 | |||
2018 | 6,828 | ||||
2019 | 127,067 | ||||
2020 | 32,431 | ||||
2021 | 46,683 | ||||
Thereafter | 402,723 | ||||
Total | $ | 621,382 |
Year | Number of Multi-Family Properties Acquired | Number of Units Acquired | ||
2012 | 5 | 1,451 | ||
2013 | 9 | 2,334 | ||
2014 | 13 | 4,174 | ||
2015 | 4 | 1,506 | ||
2016 | 11 | 3,336 | ||
2017 (1) | 3 | 933 | ||
Total | 45 | 13,734 |
Year | Number of Multi-Family Properties Sold | Number of Units Sold | ||
2015 | 3 | 1,175 | ||
2016 | 6 | 2,206 | ||
2017 | 4 | 1,016 | ||
Total | 13 | 4,397 |
• | the NJV Loan Receivable. This loan matures in June 2017 and bears an annual interest rate of 11%. Six percent (6%) is to be paid on a monthly basis and five percent (5%) is deferred and is to be paid on December 31, 2016 and at maturity in June 2017. At September 30, 2016, the amount of deferred interest that has accrued is $2.4 million. The NJV Loan Receivable is secured by various contiguous parcels on Market Street (between University Avenue and Washington Street) in Newark, NJ. The site is approximately 68,000 square feet and has approximately 303,000 square feet of rentable space. See Item 7. "Management Discussion and Analysis of Financial Condition and Results of Operations - Sale of Interests in Newark Joint Venture" and Note 4 to our consolidated financial statements for information regarding the Newark Joint Venture, the sale of our interests therein and the NJV Loan Receivable. |
• | changes in national, regional and local economic conditions, which may be negatively impacted by concerns about inflation, deflation, government deficits, unemployment rates and decreased consumer confidence particularly in markets in which we have a high concentration of properties; |
• | increases in interest rates, which could adversely affect our ability to obtain financing or to buy or sell properties on favorable terms or at all; |
• | the inability of residents and tenants to pay rent; |
• | the existence and quality of the competition, such as the attractiveness of our properties as compared to our competitors' properties based on considerations such as convenience of location, rental rates, amenities and safety record; |
• | increased operating costs, including increased real property taxes, maintenance, insurance and utility costs (including increased prices for fossil fuels); |
• | weather conditions that may increase or decrease energy costs and other weather-related expenses; |
• | oversupply of apartments or single-family housing or a reduction in demand for real estate in the markets in which our properties are located; |
• | a favorable interest rate environment that may result in a significant number of potential residents of our multi-family properties deciding to purchase homes instead of renting; |
• | changes in, or increased costs of compliance with, laws and/or governmental regulations, including those governing usage, zoning, the environment and taxes; and |
• | rent control or stabilization laws, or other laws regulating rental housing, which could prevent us from raising rents to offset increases in operating costs. |
Year | Principal Payments Due at Maturity | Weighted Average Interest Rate | ||||||
2017 | — | — | ||||||
2018 | — | — | ||||||
2019 | $ | 107,475 | 3.53 | % | ||||
2020 | 39,022 | 3.10 | % | |||||
2021 | 38,673 | 4.15 | % | |||||
2022 and thereafter | 368,248 | 4.18 | % | |||||
$ | 553,418 | 3.97 | % |
• | the agreement of our joint venture partner to sell a property; |
• | adverse market conditions, including the limited availability of mortgage debt required by a buyer to acquire a property or increased interest rates; |
• | federal tax laws that may limit our ability to profit on the sale of properties that we have owned for less than two years. |
• | we may abandon opportunities that we have already begun to explore for a number of reasons, including changes in local market conditions or increases in construction or financing costs, and, as a result, we may fail to recover expenses already incurred in exploring those opportunities; |
• | occupancy rates and rents at a development property may fail to meet our original expectations for a number of reasons, including changes in market and economic conditions beyond our control and the development by competitors of competing properties; |
• | we may be unable to obtain, or experience delays in obtaining, necessary zoning, occupancy, or other required governmental or third party permits and authorizations, which could result in increased costs or the delay or abandonment of development opportunities; |
• | we may incur costs that exceed our original estimates due to increased material, labor or other costs; |
• | we may be unable to complete construction and lease-up of a development project on schedule, resulting in increased construction and financing costs and a decrease in expected rental revenues; and |
• | we may be unable to obtain financing with favorable terms, or at all, for the proposed development of a property, which may cause us to delay or abandon a development opportunity. |
• | our partner might become bankrupt, insolvent or otherwise refuse or be unable to meet their obligations to us or the venture (including their obligation to make capital contributions or property distributions when due); |
• | we may incur liabilities as a result of action taken by our partner; |
• | our partner may not perform its property oversight responsibilities; |
• | our partner may have economic or business interests or goals which are or become inconsistent with our business interests or goals, including inconsistent goals relating to the sale or refinancing of properties held in the joint venture or the timing of the termination or liquidation of the joint venture; |
• | our partner may be in a position to take action or withhold consent contrary to our instructions or requests, including actions that may make it more difficult to maintain our qualification as a REIT; |
• | our partner might engage in unlawful or fraudulent conduct with respect to our jointly owned properties or other properties in which they have an ownership interest; |
• | our partner may trigger a buy-sell arrangement, which could cause us to sell our interest, or acquire our partner's interest, at a time when we otherwise would not have initiated such a transaction; |
• | disputes between us and our partners may result in litigation or arbitration that would increase our expenses and divert management's attention from operating our business; |
• | disagreements with our partners with respect to property management (including with respect to whether a property should be sold, refinanced, or improved) could result in an impasse resulting in the inability to operate the property effectively; and |
• | our partners may have other competing real estate interests in the markets in which our properties are located that could infuence the partners to take actions favoring their properties to the detriment of the jointly owned properties. |
Fiscal 2016 | Fiscal 2015 | |||||||||||||||
Fiscal Quarters | High | Low | High | Low | ||||||||||||
First Quarter | $ | 7.48 | $ | 6.02 | $ | 7.50 | $ | 6.91 | ||||||||
Second Quarter | 7.15 | 5.41 | 7.35 | 6.71 | ||||||||||||
Third Quarter | 7.28 | 6.93 | 7.30 | 6.74 | ||||||||||||
Fourth Quarter | 8.25 | 7.01 | 7.19 | 6.76 |
9/11 | 9/12 | 9/13 | 9/14 | 9/15 | 9/16 | |||||||||||||||||||
BRT Realty Trust | $ | 100.00 | $ | 104.50 | $ | 115.27 | $ | 120.58 | $ | 113.99 | $ | 128.62 | ||||||||||||
S&P 500 | 100.00 | 130.20 | 155.39 | 186.05 | 184.91 | 213.44 | ||||||||||||||||||
FTSE NAREIT Mortgage REITs | 100.00 | 133.19 | 122.01 | 137.70 | 132.67 | 157.72 | ||||||||||||||||||
FTSE NAREIT Equity Apartments | 100.00 | 118.87 | 116.77 | 136.37 | 170.20 | 186.37 |
Period | (a) Total Number of Shares Purchased | (b) Average Price Paid per Share | (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | (d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs | ||||
July 1 - July 31, 2016 | 1,878 | $7.19 | 1,878 | $4,513,013 | ||||
August 1 - August 31, 2016 | 5,701 | 7.24 | 5,701 | 4,471,730 | ||||
September 1- September 30, 2016 | 288 | 7.37 | 288 | 4,469,607 | ||||
Total | 7,867 | 7,867 |
(Dollars in thousands, except per share amounts) | 2016 | 2015 | 2014 | 2013 | 2012 | |||||||||||||||
Operating statement data: | ||||||||||||||||||||
Total revenues(1) | $ | 94,264 | $ | 77,095 | $ | 61,813 | $ | 28,984 | $ | 8,099 | ||||||||||
Total expenses(2) | 104,101 | 87,376 | 74,030 | 38,330 | 12,330 | |||||||||||||||
Gain on sale of real estate | 46,477 | 15,005 | — | — | — | |||||||||||||||
Income (loss) from continuing operations | 32,479 | 4,724 | (12,217 | ) | (3,335 | ) | (3,626 | ) | ||||||||||||
Income (loss) from discontinued operations | 12,679 | (6,329 | ) | (3,949 | ) | 5,424 | 5,176 | |||||||||||||
Net (loss) income attributable to common shareholders | 31,289 | (2,388 | ) | (9,454 | ) | 5,013 | 4,430 | |||||||||||||
Earnings (loss) per beneficial share: | ||||||||||||||||||||
Income (loss) from continuing operations | $ | 1.21 | $ | (0.02 | ) | $ | (0.81 | ) | $ | (0.21 | ) | $ | (0.23 | ) | ||||||
Income (loss) from discontinued operations | 1.02 | (0.15 | ) | 0.15 | 0.56 | 0.55 | ||||||||||||||
Basic and diluted (loss) earnings per share | $ | 2.23 | $ | (0.17 | ) | $ | (0.66 | ) | $ | 0.35 | $ | 0.32 | ||||||||
Balance sheet data: | ||||||||||||||||||||
Total assets(3) | $ | 874,899 | $ | 820,869 | $ | 734,620 | $ | 549,491 | $ | 385,956 | ||||||||||
Real estate properties, net(3) | 759,576 | 591,727 | 522,591 | 310,541 | 128,509 | |||||||||||||||
Cash and cash equivalents | 27,399 | 15,556 | 22,639 | 55,782 | 75,314 | |||||||||||||||
Restricted cash-construction holdback/multi-family | 7,383 | 6,518 | 9,555 | 3,090 | — | |||||||||||||||
Assets related to discontinued operations(4) | — | 173,228 | 134,188 | 142,607 | 148,036 | |||||||||||||||
Mortgages payable, net of deferred fees (5) | 588,457 | 451,159 | 382,690 | 230,570 | 90,361 | |||||||||||||||
Junior subordinated notes | 36,998 | 36,978 | 36,958 | 36,938 | 36,918 | |||||||||||||||
Total BRT Realty Trust shareholders' equity | 151,290 | 122,655 | 138,791 | 138,791 | 133,449 |
(1) | The increases from 2012 through 2016 are due primarily to the operations of our multi-family properties. |
(2) | The increases from 2012 through 2016 are due primarily to increased expenses (i.e., operating expense, interest expense and depreciation and amortization) related to the operations of our multi-family properties |
(3) | The increases from 2012 through 2016 are due to our multi-family property acquisitions. |
(4) | Primarily reflects the assets of the Newark Joint Venture |
(5) | Approximately $154.6 million of the increase from 2013 to 2014 and approximately $141.9 million of the increase from 2012 to 2013 is due to the mortgage debt incurred in the multi-family property acquisitions. |
2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||||
Net income (loss) attributable to common shareholders | $ | 31,289 | $ | (2,388 | ) | $ | (9,454 | ) | $ | 5,013 | $ | 4,430 | ||||||||
Add: depreciation of properties | 24,329 | 20,681 | 15,562 | 7,076 | 1,992 | |||||||||||||||
Add: our share of depreciation in unconsolidated joint ventures | 20 | 20 | 20 | 34 | 270 | |||||||||||||||
Add: amortization of deferred leasing costs | 15 | 71 | 62 | 64 | 59 | |||||||||||||||
Deduct: gain on sales of real estate and partnership interests | (62,329 | ) | (15,005 | ) | — | (6,250 | ) | (792 | ) | |||||||||||
Adjustment for non-controlling interest | 13,319 | 221 | (4,012 | ) | (1,549 | ) | (600 | ) | ||||||||||||
Funds from operations | 6,643 | 3,600 | 2,178 | 4,388 | 5,359 | |||||||||||||||
Adjust for: straight-line rent accruals | (200 | ) | (411 | ) | (542 | ) | (263 | ) | (23 | ) | ||||||||||
Add: loss on extinguishment of debt | 4,547 | — | — | — | — | |||||||||||||||
Add: amortization of restricted stock and RSU expense | 1,005 | 906 | 805 | 691 | 757 | |||||||||||||||
Add: amortization of deferred mortgage costs | 1,645 | 2,242 | 1,825 | 1,371 | 580 | |||||||||||||||
Adjustment for non-controlling interest | (2,729 | ) | (703 | ) | (424 | ) | (463 | ) | (247 | ) | ||||||||||
Adjusted funds from operations | $ | 10,911 | $ | 5,634 | $ | 3,842 | $ | 5,724 | $ | 6,426 |
2016 | 2015 | 2014 | 2013 | 2012 | ||||||||||||||||
Net income (loss) attributable to common shareholders | $ | 2.23 | $ | (0.17 | ) | $ | (0.66 | ) | $ | 0.35 | $ | 0.32 | ||||||||
Add: depreciation of properties | 1.74 | 1.46 | 1.10 | 0.51 | 0.14 | |||||||||||||||
Add: our share of depreciation in unconsolidated joint ventures | — | — | — | — | 0.02 | |||||||||||||||
Add: amortization of deferred leasing costs | — | — | — | — | — | |||||||||||||||
Deduct: gain on sales of real estate and partnership interests | (4.45 | ) | (1.07 | ) | — | (0.44 | ) | (0.06 | ) | |||||||||||
Adjustment for non-controlling interest | 0.95 | 0.02 | (0.28 | ) | (0.11 | ) | (0.04 | ) | ||||||||||||
Funds from operations | 0.47 | 0.24 | 0.16 | 0.31 | 0.38 | |||||||||||||||
Adjustment for: straight-line rent accruals | (0.01 | ) | (0.04 | ) | (0.04 | ) | (0.02 | ) | — | |||||||||||
Add: loss on extinguishment of debt | 0.32 | — | — | — | — | |||||||||||||||
Add: amortization of restricted stock and RSU expense | 0.07 | 0.07 | 0.06 | 0.05 | 0.05 | |||||||||||||||
Add: amortization of deferred mortgage costs | 0.12 | 0.16 | 0.13 | 0.1 | 0.04 | |||||||||||||||
Adjustment for non-controlling interest | (0.19 | ) | (0.07 | ) | (0.03 | ) | (0.03 | ) | (0.04 | ) | ||||||||||
Adjusted funds from operations | $ | 0.78 | $ | 0.36 | $ | 0.28 | $ | 0.40 | $ | 0.44 |
• | we acquired 11 multi-family properties (the "2016 Acquisitions") with an aggregate of 3,336 units for an aggregate of $318.7 million, including aggregate mortgage debt of $238.2 million and $67.3 million of our equity (including a development property at which the construction of 271 units is contemplated); |
• | we sold six multi-family properties, which we refer to as the 2016 Sold Properties, with an aggregate of 2,206 units, and two cooperative apartment units for an aggregate of $202.0 million and an aggregate gain (net of aggregate mortgage prepayment charges of $4.5 million), of $42.3 million - $16.4 million of this gain was allocated to our joint venture partners; |
• | we sold our interests in the Newark Joint Venture for $16.9 million and recognized a $15.5 million gain on the sale for tax and financial statement purposes. See "- Sale of Interests in Newark Joint Venture"; |
• | we repurchased 326,421 shares for $2.1 million ; |
• | we obtained $14.7 million of supplemental mortgage debt on four multi-family properties; and |
• | we have cash and cash equivalents of approximately $27.4 million and approximately $35.3 million, at September 30, 2016 and November 30, 2016, respectively. |
(Dollars in thousands): | 2016 | 2015 | Increase (Decrease) | % Change | |||||||||||
Rental and other revenue from real estate properties | $ | 90,945 | $ | 77,023 | $ | 13,922 | 18.1 | % | |||||||
Other income | 3,319 | 72 | 3,247 | N/A | |||||||||||
Total revenues | $ | 94,264 | $ | 77,095 | $ | 17,169 | 22.3 | % |
• | $12.9 million from the operations of the 2016 Acquisitions; |
• | $11.0 million due to the inclusion, for a full year, of the operations of four properties that were acquired in 2015 (the "2015 Acquisitions"); |
• | $2.8 million from operations of our Southridge property, which prior to its sale in October 2016 was engaged in lease up activities; and |
• | $2.2 million due primarily to rental rate increases from the operations of same store properties. Seven properties accounted for 78% of the increase at same store properties. Average rents at same store properties increased to $892 per occupied unit in 2016 from $841 per occupied unit in the prior year. |
(Dollars in thousands) | 2016 | 2015 | Increase (Decrease) | % Change | |||||||||||
Real estate operating expenses | $ | 43,262 | $ | 38,609 | $ | 4,653 | 12.1 | % | |||||||
Interest expense | 23,878 | 19,297 | 4,581 | 23.7 | % | ||||||||||
Advisor's fees, related party | 693 | 2,448 | (1,755 | ) | (71.7 | )% | |||||||||
Property acquisition costs | 3,852 | 1,885 | 1,967 | 104.4 | % | ||||||||||
General and administrative | 8,536 | 6,683 | 1,853 | 27.7 | % | ||||||||||
Provision for Federal tax | 700 | — | 700 | NA | |||||||||||
Depreciation | 23,180 | 18,454 | 4,726 | 25.6 | % | ||||||||||
Total expenses | $ | 104,101 | $ | 87,376 | $ | 16,725 | 19.1 | % |
• | $5.7 million from the operations of the 2016 Acquisitions; |
• | $5.4 million to the inclusion, for a full year, of the operations of the 2015 Acquisitions; |
• | $1.0 million from the operations of a property engaged in lease up activities; and |
• | $129,000 from operations of the same store properties. |
• | $4.0 million from the mortgage debt incurred in the 2016 Acquisitions; |
• | $3.3 million due to the inclusion, for a full year, of the interest expense associated with the mortgage debt incurred in the 2015 Acquisitions; |
• | $825,000 from four same store properties that obtained supplemental debt; and |
• | $596,000 from the cessation of the capitalization of interest from a development property in connection with the commencement of lease up activities. |
• | $4.8 million from the operations of the 2016 Acquisitions; |
• | $4.3 million from the inclusion, for a full year, of the operations of the 2015 Acquisitions; and |
• | $1.1 million from the operations of a property in connection with the commencement of lease up activities. |
(Dollars in thousands): | 2015 | 2014 | Increase (Decrease) | % Change | |||||||||||
Rental and other revenue from real estate properties | $ | 77,023 | $ | 61,725 | $ | 15,298 | 24.8 | % | |||||||
Other income | 72 | 88 | (16 | ) | (18.2 | )% | |||||||||
Total revenues | $ | 77,095 | $ | 61,813 | $ | 15,282 | 24.7 | % |
• | $11.6 million to the inclusion, for a full year, of operations of the 12 properties acquired in 2014 (the "2014 Acquisitions") and, to a lesser extent, higher rental rates at several of these properties; |
• | $3.6 million from the operations of the 2015 Acquisitions; and |
• | $2.1 million primarily due to rental rate increases at same store properties; in particular, rental rate increases at The Fountains Apartments and Mountain Park Estates, which account for approximately $1.1 million of the increase. |
(Dollars in thousands) | 2015 | 2014 | Increase (Decrease) | % Change | |||||||||||
Real estate operating expenses | $ | 38,609 | $ | 32,984 | $ | 5,625 | 17.1 | % | |||||||
Interest expense | 19,297 | 16,434 | 2,863 | 17.4 | % | ||||||||||
Advisor's fees, related party | 2,448 | 1,801 | 647 | 35.9 | % | ||||||||||
Property acquisition costs | 1,885 | 2,542 | (657 | ) | (25.8 | )% | |||||||||
General and administrative | 6,683 | 6,324 | 359 | 5.7 | % | ||||||||||
Depreciation | 18,454 | 13,945 | 4,509 | 32.3 | % | ||||||||||
Total expenses | $ | 87,376 | $ | 74,030 | $ | 13,346 | 18.0 | % |
• | $5.4 million, due to the inclusion, for a full year, of the operations at the 2014 Acquisitions; and |
• | $1.5 million from the operations at the 2015 Acquisitions. |
• | $2.2 million, due to the inclusion, for a full year, of the interest on the mortgage debt incurred in the 2014 Acquisitions; |
• | $910,000, due to the interest on the mortgage debt incurred in connection with the 2015 Acquisitions; and |
• | $257,000 from supplemental financing obtained in 2015 at three properties. |
(Dollars in Thousands) | 2015 | 2014 | Increase/(decrease) | |||||||||
Multi- family | $ | (4,878 | ) | $ | 759 | $ | (5,637 | ) | ||||
Other | 4,095 | 5,953 | (1,858 | ) | ||||||||
Total | $ | (783 | ) | $ | 6,712 | $ | (7,495 | ) | ||||
Payment due by Period | ||||||||||||||||||||
(Dollars in thousands) | Less than 1 Year | 1 - 3 Years | 3 - 5 Years | More than 5 Years | Total | |||||||||||||||
Long-Term Debt Obligations(1) | $ | 30,830 | $ | 181,102 | $ | 117,676 | $ | 511,481 | $ | 841,089 | ||||||||||
Operating Lease Obligation | 207 | 427 | 446 | 216 | 1,296 | |||||||||||||||
Purchase Obligations(2)(3) | 4,667 | 9,334 | 9,334 | — | 23,335 | |||||||||||||||
Total | $ | 35,704 | $ | 190,863 | $ | 127,456 | $ | 511,697 | $ | 865,720 |
(1) | Includes payments of principal (including amortization payments) and interest and excludes deferred costs. Assumes that interest rate on the junior subordinated notes will be 2.76% per annum. |
(2) | Assumes that $550,000 will be paid annually for the next five years pursuant to the shared services agreement (i.e., the same amount paid in 2016 pursuant to this agreement), and $1.15 million will be paid annually through September 30, 2021, to personnel performing the services previously performed pursuant to the Advisory Agreement. See "Business—Our Structure." |
(3) | Assumes that approximately $3.0 million of property management fees will be paid annually to the managers of our multi-family properties. Such sum reflects the amount we anticipate paying in 2017 on the multi-family properties we own at September 30, 2016. These fees are typically charged based on a percentage of rental revenues from a property. No amount has been reflected as payable pursuant thereto after five years as such amount is not determinable. |
Payment due by Period | ||||||||||||||||||||
(Dollars in thousands) | Less than 1 Year | 1 - 3 Years | 3 - 5 Years | More than 5 Years | Total | |||||||||||||||
Multi-family properties | $ | 29,605 | $ | 178,652 | $ | 115,226 | $ | 459,103 | $ | 782,586 | ||||||||||
Junior subordinated notes | 1,032 | 2,064 | 2,064 | 51,422 | 56,582 | |||||||||||||||
Other | 193 | 386 | 386 | 956 | 1,921 | |||||||||||||||
Total | $ | 30,830 | $ | 181,102 | $ | 117,676 | $ | 511,481 | $ | 841,089 |
For the Years ended September 30, | |||||||||||
2016 | 2015 | 2014 | |||||||||
Cash flow from operating activities | $ | 10,080 | $ | 8,407 | $ | (4,835 | ) | ||||
Cash flow from investing activities | (135,783 | ) | (67,388 | ) | (219,324 | ) | |||||
Cash flow from financing activities | 137,546 | 51,356 | 190,435 | ||||||||
Net increase (decrease) in cash and cash equivalents | 11,843 | (7,625 | ) | (33,724 | ) | ||||||
Cash and cash equivalents at beginning of year | 15,556 | 23,181 | 56,905 | ||||||||
Cash and cash equivalents at end of year | $ | 27,399 | $ | 15,556 | $ | 23,181 |
• | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of a company; |
• | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of a company are being made only in accordance with authorizations of management and directors of a company; and |
• | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of a company's assets that could have a material effect on the financial transactions. |
Name | Office | |
Israel Rosenzweig(1) | Chairman of the Board of Trustees | |
Jeffrey A. Gould(2) | President and Chief Executive Officer; Trustee | |
Mitchell K. Gould (3) | Executive Vice President | |
Matthew J. Gould(2) | Senior Vice President; Trustee | |
Simeon Brinberg(4) | Senior Counsel | |
David W. Kalish(5) | Senior Vice President, Finance | |
Mark H. Lundy(4) | Senior Vice President and General Counsel | |
George E. Zweier | Vice President and Chief Financial Officer | |
Isaac Kalish(5) | Vice President and Treasurer | |
Steven Rosenzweig(1) | Vice President |
(2) | Jeffrey A. Gould and Matthew J. Gould are sons of Fredric H. Gould, the former chairman of our board of trustees and currently, a trustee. |
(3) | Mitchell K. Gould is a cousin of Fredric H. Gould |
Number of securities to be issued upon exercise (or vesting) of outstanding options, restricted stock units, warrants and rights (a) | Weighted-average exercise price of outstanding options, warrants and rights (b) | Number of securities remaining available-for future issuance under equity compensation plans—excluding securities reflected in column(a) (c) | |||
Equity compensation plans approved by security holders (1) | 450,000 | — | 150,000 | ||
Equity compensation plans not approved by security holders | — | — | — | ||
Total | 450,000 | — | 150,000 |
(1) | Reflects the number of common shares underlying restricted stock units. Such units vest in 2021 subject to the satisfaction of time and performance based vesting conditions. There is no exercise price associated with such units. |
• | should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; |
• | have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement; |
• | may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and |
• | were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments. Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time. |
Exhibit No. | Title of Exhibits | ||
3.1 | Third Amended and Restated Declaration of Trust (incorporated by reference to Exhibit 3.1 to our Form 10-K for the year ended September 30, 2005). | ||
3.2 | By-laws (incorporated by reference to Exhibit 3.2 to our Form 10-K for the year ended September 30, 2005). | ||
3.3 | Amendment to By-laws, dated December 10, 2007 (incorporated by reference to Exhibit 3.1 to our Form 8-K filed December 11, 2007). | ||
3.4 | Amendment No. 2 to By-laws dated June 6, 2016 (incorporated by reference to exhibit 3.3 to our Current Report on Form 8-K filed on June 10, 2016). | ||
4.1 | Junior Subordinated Supplemental Indenture, dated as of March 15, 2011, between us and the Bank of New York Mellon (incorporated by reference to Exhibit 4.1 to our Form 8-K filed March 18, 2011). | ||
4.2 | Form of Certificate for Shares of Beneficial Interest (incorporated by reference to Exhibit 4.1 to Registration Statement on Form S-8 (Registration No. 333-104461) filed on April 11, 2003). | ||
10.1 | * | Amended and Restated Advisory Agreement, effective as of January 1, 2007, between us and REIT Management Corp. (incorporated by reference to Exhibit 10.1 to our Form 8-K filed November 27, 2006). | |
10.2 | * | Amendment No. 1 dated as of December 8, 2011 to Amended and Restated Advisory Agreement between us and REIT Management (incorporated by reference to exhibit 10.2 to our Form 10-Q for the period ended December 31, 2011). | |
10.3 | * | Amendment No. 2 dated as of March 12, 2014 and effective as of June 30, 2014 to Amended and Restated Advisory Agreement between us and REIT Management, as amended. (incorporated by reference to Exhibit 10.1 to our Form 10-Q for the period ended March 31, 2014) | |
10.4 | * | Shared Services Agreement, dated as of January 1, 2002, by and among Gould Investors L.P., us, One Liberty Properties, Inc., Majestic Property Management Corp., Majestic Property Affiliates, Inc. and REIT Management Corp. (incorporated by reference to Exhibit 10.2 to our Form 10-K filed December 11, 2008). | |
10.5 | Amended and Restated Limited Liability Company Operating Agreement by and among TRB Newark Assemblage LLC, TRB Newark TRS, LLC, RBH Capital, LLC and RBH Partners LLC (incorporated by reference to Exhibit 10.1 to our Form 8-K filed June 9, 2009). | ||
10.6 | * | Form of Restricted Stock Award Agreement (incorporated by reference to Exhibit 10.5 to our Form 10-K for the year ended September 30, 2010). | |
10.7 | * | Form of Restricted Shares Agreement for the 2012 Incentive Plan (incorporated by reference to Exhibit 10.1 to our Form 10-Q for the period ended December 31, 2013). | |
10.8 | * | 2009 Incentive Plan, as amended (incorporated by reference to exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ended December 31, 2011). | |
10.9 | * | 2012 Incentive Plan (incorporated by reference to exhibit 99.1 to our Registration Statement on Form S-8 filed on June 11, 2012 (File No. 333-182044)). | |
10.10 | Bond agreement dated as of December 1, 2011 by and among the New Jersey Economic Development Authority, RBH-TRB East Mezz Urban Renewal Entity, LLC and TD Bank, N.A. (incorporated by reference to exhibit 10.3 to our Form 10-Q for the period ended December 31, 2011). | ||
10.11 | Note dated December 29, 2011 issued by RBH-TRB East Mezz Urban Renewal Entity LLC in favor of New Jersey Economic Development Authority (incorporated by reference to exhibit 10.4 to our Form 10-Q for the period ended December 31, 2011). | ||
10.12 | Multi-Family Loan and Security Agreement (Non-Recourse) by and between Landmark at Garden Square, LLC, and Berkadia Commercial Mortgage LLC, dated as of March 22, 2012 (incorporated by reference to exhibit 10.1 to our Form 10-Q for the period ended March 31, 2012). | ||
Exhibit No. | Title of Exhibits | ||
10.13 | Consolidated, Amended and Restated Multi-family Note entered into as of March 22, 2012, by and between Landmark at Garden Square, LLC and Berkadia Commercial Mortgage LLC. (incorporated by reference to exhibit 10.2 to our Form 10-Q for the period ended March 31, 2012). | ||
10.14 | Mortgage and Security Agreement made as of February 3, 2012, given by RBH-TRB East Mezz Urban Renewal Entity, LLC, in favor of New Jersey Economic Development Authority (incorporated by reference to exhibit 10.4 to our Form 10-Q for the period ended March 31, 2012). | ||
10.15 | Guaranty of Completion made as of the 3rd day of February, 2012, by RBH-TRB Newark Holdings, LLC, and RBH-TRB East Mezz Urban Renewal Entity, LLC, in favor of TD Bank, N.A. (incorporated by reference to exhibit 10.5 to our Form 10-Q for the period ended March 31, 2012). | ||
10.16 | Security Agreement dated as of February 3, 2012, by and between RBH-TRB East Mezz Urban Renewal Entity, LLC and TD Bank, N.A. (incorporated by reference to exhibit 10.6 to our Form 10-Q for the period ended March 31, 2012). | ||
10.17 | Leasehold Mortgage, Assignment of Leases and Rents and Security Agreement dated February 3, 2012 in the amount of $32,700,000 from Teachers Village School QALICB Urban Renewal, LLC to NJCC CDE Essex LLC, and Gateway SUB-CDE I, LLC. (incorporated by reference to exhibit 10.7 to our Form 10-Q for the period ended March 31, 2012). | ||
10.18 | Leasehold Mortgage, Assignment of Leases and Rents and Security Agreement dated February 3, 2012 in the amount of $27,000,000 from Teachers Village School QALICB Urban Renewal, LLC to NJCC CDE Essex LLC, and Gateway SUB-CDE I, LLC. (incorporated by reference to exhibit 10.8 to our Form 10-Q for the period ended March 31, 2012). | ||
10.19 | Joint and Several Completion Guaranty dated as of February 3, 2012, by Teachers Village School QALICB Urban Renewal, LLC, and RBH-TRB Newark Holdings, LLC, to TD Bank, N.A. Gateway SUB-CDE I, LLC, and NJCC CDE Essex LLC. (incorporated by reference to exhibit 10.9 to our Form 10-Q for the period ended March 31, 2012). | ||
10.20 | Guaranty of New Markets Tax Credits made as of February 3, 2012, by Teachers Village School QALICB Urban Renewal, LLC, and RBH-TRB Newark Holdings, LLC, for the benefit of GSB NMTC Investor LLC. (incorporated by reference to exhibit 10.10 to our Form 10-Q for the period ended March 31 2012). | ||
10.21 | Multi-Family Loan and Security Agreement dated as of the June 20, 2012 by and between Madison 324, LLC and CWCapital LLC. (incorporated by reference to exhibit 10.1 to our Form 10-Q for the period ended June 30, 2012) | ||
10.22 | Multi-Family Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing dated as of the 20th day of June, 2012, executed by Madison 324, LLC to Joseph B. Pitt, JR, as trustee for the benefit of CWCapital LLC. (incorporated by reference to exhibit 10.2 to our Form 10-Q for the period ended June 30, 2012). | ||
10.23 | Multi-Family Note dated as of June 20, 2012 in face amount of $25,680,000 issued by Madison 324, LLC in favor of CWCapital LLC. (incorporated by reference to exhibit 10.3 to our Form 10-Q for the period ended June 30, 2012). | ||
10.24 | Guaranty of New Markets Tax Credits made as of September 11, 2012, by Teachers Village Project A QALICB Urban Renewal Entity, LLC, and RBH-TRB Newark Holdings, LLC for the benefit of GSB NMTC Investor LLC, its successors and assigns (incorporated by reference to exhibit 10.32 to our Form 10-K for the year ended September 30, 2012). | ||
Exhibit No. | Title of Exhibits | |||
10.25 | Guaranty of Payment and Recourse Carveouts made as of the 11th day of September, 2012, by RBH-TRB Newark Holdings, LLC and Ron Beit-Halachmy, in favor of Goldman Sachs Bank USA. (incorporated by reference to exhibit 10.33 to our Form 10-K for the year ended September 30, 2012). | |||
10.26 | Joint and Several Completion Guaranty dated as of September 11, 2012, made on a joint and several basis by Teachers Village Project A QALICB Urban Renewal Entity, LLC and RBH-TRB Newark Holdings LLC, to Goldman Sachs Bank USA. (incorporated by reference to exhibit 10.34 to our Form 10-K for the year ended September 30, 2012). | |||
10.27 | Environmental Indemnity Agreement dated as of September 11, 2012, made by Teachers Village Project A QALICB Urban Renewal Entity, LLC, to Goldman Sachs Bank USA. (incorporated by reference to exhibit 10.35 to our Form 10-K for the year ended September 30, 2012). | |||
10.28 | Environmental Indemnity Agreement dated as of September 11, 2012, made by Teachers Village Project A QALICB Urban Renewal Entity, LLC, to GSB NMTC Investor LLC; Carver CDC-Subsidiary CDE 21, LLC; NCIF New Markets Capital Fund IX CDE, LLC; GSNMF Sub-CDE 2 LLC; and BACDE NMTC Fund 4, LLC. (incorporated by reference to exhibit 10.36 to our Form 10-K for the year ended September 30, 2012). | |||
10.29 | Building Loan Agreement dated as of September 11, 2012 by and among GSB NMTC Investor LLC, and NCIF New Markets Capital Fund IX CDE, LLC; NCIF New Markets Capital Fund IX CDE LLC, Carver CDC-Subsidiary CDE-21, LLC, BACDE NMTC Fund 4 LLC, GSNMF Sub-CDE 2 LLC and Teachers Village Project A QALICB Urban Renewal Entity, LLC. (incorporated by reference to exhibit 10.37 to our Form 10-K for the year ended September 30, 2012). | |||
10.30 | Mortgage, Assignment of Leases and Rents and Security Agreement dated September 2012 in the amount of $15,699,999 from Teachers Village Project A QALICB Urban Renewal Entity, LLC to NCIF New Markets Capital Fund IX CDE, LLC, Carver CDC-Subsidiary CDE 21, LLC, BACDE NMTC Fund 4, LLC and GSNMF Sub-CDE 2, LLC. (incorporated by reference to exhibit 10.38 to our Form 10-K for the year ended September 30, 2012). | |||
10.31 | Mortgage, Assignment of Leases and Rents and Security Agreement dated September 2012 in the amount of $9,000,000 from Teachers Village Project A QALICB Urban Renewal Entity, LLC, to Goldman Sachs Bank USA. (incorporated by reference to exhibit 10.39 to our Form 10-K for the year ended September 30, 2012). | |||
10.32 | Loan Agreement dated as of September 11, 2012 between Goldman Sachs Bank USA, and RBH-TRB Newark Holdings, LLC (incorporated by reference to exhibit 10.40 to our Form 10-K for the year ended September 30, 2012). | |||
10.33 | Building Loan Agreement dated as of September 11, 2012 by and between Goldman Sachs Bank USA, and Teachers Village Project A QALICB Urban Renewal Entity, LLC (incorporated by reference to exhibit 10.41 to our Form 10-K for the year ended September 30, 2012 (incorporated by reference to exhibit 10.41 to our Form 10-K for the year ended September 30, 2012). | |||
10.34 | Loan Agreement made as of the 11th day of September, 2012, by and between RBH-TRB-West I Mezz Urban Renewal Entity, LLC, and Goldman Sachs Bank USA, Carver CDC-Subsidiary CDE 21, LLC, and BACDE NMTC Fund 4, LLC, and GSNMF Sub- CDE 2 LLC, and Teachers Village Project A QALICB Urban Renewal Entity, LLC. (incorporated by reference to exhibit 10.42 to our Form 10-K for the year ended September 30, 2012). | |||
10.35 | Amended and Restated 2016 Incentive Plan (incorporated by reference to exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ended March 31, 2016). | |||
10.36 | Membership Interest Purchase Agreement dated as of February 23, 2016 entered into between TRB Newark Assemblage, LLC ("TRB") and TRB Newark TRS, LLC ("TRB REIT" and together with TRB, collectively, the "Seller") and RBH Partners III, LLC, and joined by RBH-TRB Newark Holdings, LLC and GS-RBH Newark Holdings, LLC (incorporated by reference to exhibit 10.2 to our Quarterly Report on Form 10-Q for the period ended March 31, 2016). | |||
10.37* | Form of Performance Awards Agreement (incorporated by reference to exhibit 10.1 to our Current Report on Form 8-K filed on June 10, 2016). | |||
Exhibit No. | Title of Exhibits | ||
14.1 | Revised Code of Business Conduct and Ethics of BRT Realty Trust, adopted June 12, 2006 (incorporated by reference to Exhibit 14.1 to the Form 8-K of BRT Realty Trust filed June 14, 2006). | ||
21.1 | Subsidiaries of the Registrant | ||
23.1 | Consent of BDO USA LLP | ||
31.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (the "Act") | ||
31.2 | Certification of Senior Vice President—Finance pursuant to Section 302 of the Act. | ||
31.3 | Certification of Chief Financial Officer pursuant to Section 302 of the Act | ||
32.1 | Certification of Chief Executive Officer pursuant to Section 906 of the Act | ||
32.2 | Certification of Senior Vice President—Finance pursuant to Section 906 of the Act | ||
32.3 | Certification of Chief Financial Officer pursuant to Section 906 of the Act | ||
101.INS | XBRL Instance Document | ||
101.SCH | XBRL Taxonomy Extension Schema Document | ||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | ||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | ||
101.LAB | XBRL Taxonomy Extension Definition Label Linkbase Document | ||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
* | Indicates management contract or compensatory plan or arrangement. |
BRT REALTY TRUST | ||||
Date: December 13, 2016 | By: | /s/ JEFFREY A. GOULD | ||
Jeffrey A. Gould Chief Executive Officer and President |
Signature | Title | Date | ||
/s/ ISRAEL ROSENZWEIG | Chairman of the Board | December 13, 2016 | ||
Israel Rosenzweig | ||||
/s/ JEFFREY A. GOULD | Chief Executive Officer, President and Trustee (Principal Executive Officer) | December 13, 2016 | ||
Jeffrey A. Gould | ||||
/s/ ALAN GINSBURG | Trustee | December 13, 2016 | ||
Alan Ginsburg | ||||
/s/ FREDRIC H. GOULD | Trustee | December 13, 2016 | ||
Fredric H. Gould | ||||
/s/ MATTHEW J. GOULD | Trustee | December 13, 2016 | ||
Matthew J. Gould | ||||
/s/ LOUIS C. GRASSI | Trustee | December 13, 2016 | ||
Louis C. Grassi |
/s/ GARY HURAND | Trustee | December 13, 2016 | ||
Gary Hurand | ||||
/s/ JEFFREY RUBIN | Trustee | December 13, 2016 | ||
Jeffrey Rubin | ||||
/s/ JONATHAN SIMON | Trustee | December 13, 2016 | ||
Jonathan Simon | ||||
/s/ ELIE WEISS | Trustee | December 13, 2016 | ||
Elie Weiss | ||||
/s/ GEORGE E. ZWEIER | Chief Financial Officer, Vice President (Principal Financial and Accounting Officer) | December 13, 2016 | ||
George E. Zweier |
September 30, | ||||||||
2016 | 2015 | |||||||
ASSETS | ||||||||
Real estate properties, net of accumulated depreciation of $41,995 and $34,142 | $ | 759,576 | $ | 591,727 | ||||
Real estate loan | 19,500 | — | ||||||
Cash and cash equivalents | 27,399 | 15,556 | ||||||
Restricted cash | 7,383 | 6,518 | ||||||
Deposits and escrows | 18,972 | 12,782 | ||||||
Other assets | 8,073 | 6,882 | ||||||
Assets of discontinued operations | — | 163,545 | ||||||
Real estate properties held for sale | 33,996 | 23,859 | ||||||
Total Assets | $ | 874,899 | $ | 820,869 | ||||
LIABILITIES AND EQUITY | ||||||||
Liabilities: | ||||||||
Mortgages payable, net of deferred costs of $5,873 and $4,905 | $ | 588,457 | $ | 451,159 | ||||
Junior subordinated notes, net of deferred costs of $402 and $422 | 36,998 | 36,978 | ||||||
Accounts payable and accrued liabilities | 20,716 | 14,780 | ||||||
Liabilities of discontinued operations | — | 138,530 | ||||||
Mortgage payable held for sale | 27,052 | 19,248 | ||||||
Total Liabilities | 673,223 | 660,695 | ||||||
Commitments and contingencies | — | — | ||||||
Equity: | ||||||||
BRT Realty Trust shareholders' equity: | ||||||||
Preferred shares, $1 par value: | ||||||||
Authorized 10,000 shares, none issued | — | — | ||||||
Shares of beneficial interest, $3 par value: | ||||||||
Authorized number of shares, unlimited, 13,232 and 13,428 issued | 39,696 | 40,285 | ||||||
Additional paid-in capital | 161,321 | 161,842 | ||||||
Accumulated other comprehensive loss | (1,602 | ) | (58 | ) | ||||
Accumulated deficit | (48,125 | ) | (79,414 | ) | ||||
Total BRT Realty Trust shareholders' equity | 151,290 | 122,655 | ||||||
Non-controlling interests | 50,386 | 37,519 | ||||||
Total Equity | 201,676 | 160,174 | ||||||
Total Liabilities and Equity | $ | 874,899 | $ | 820,869 |
Year Ended September 30, | ||||||||||||
2016 | 2015 | 2014 | ||||||||||
Revenues: | ||||||||||||
Rental and other revenue from real estate properties | $ | 90,945 | $ | 77,023 | $ | 61,725 | ||||||
Other income | 3,319 | 72 | 88 | |||||||||
Total revenues | 94,264 | 77,095 | 61,813 | |||||||||
Expenses: | ||||||||||||
Real estate operating expenses—including $1,950, $1,233 and $1,120 to related parties | 43,262 | 38,609 | 32,984 | |||||||||
Interest expense | 23,878 | 19,297 | 16,434 | |||||||||
Advisor's fees, related party | 693 | 2,448 | 1,801 | |||||||||
Property acquisition costs—including $2,221,$1,293 and $1,677 to related parties | 3,852 | 1,885 | 2,542 | |||||||||
General and administrative—including $1,020, $171 and $286 to related party | 8,536 | 6,683 | 6,324 | |||||||||
Provision for Federal tax | 700 | — | — | |||||||||
Depreciation | 23,180 | 18,454 | 13,945 | |||||||||
Total expenses | 104,101 | 87,376 | 74,030 | |||||||||
Total revenues less total expenses | (9,837 | ) | (10,281 | ) | (12,217 | ) | ||||||
Gain on sale of real estate | 46,477 | 15,005 | — | |||||||||
Gain on sale of partnership interest | 386 | — | — | |||||||||
Loss on extinguishment of debt | (4,547 | ) | — | — | ||||||||
Income (loss) from continuing operations | 32,479 | 4,724 | (12,217 | ) | ||||||||
Discontinued operations: | ||||||||||||
Loss from discontinued operations—including $214 to related party in 2014 | (2,788 | ) | (6,329 | ) | (3,949 | ) | ||||||
Gain on sale of partnership interest | 15,467 | — | — | |||||||||
Income (loss) from discontinued operations | 12,679 | (6,329 | ) | (3,949 | ) | |||||||
Net income (loss) | 45,158 | (1,605 | ) | (16,166 | ) | |||||||
(Income) loss attributable to non-controlling interests | (13,869 | ) | (783 | ) | 6,712 | |||||||
Net income (loss) attributable to common shareholders | $ | 31,289 | $ | (2,388 | ) | $ | (9,454 | ) | ||||
Basic and diluted per share amounts attributable to common shareholders: | ||||||||||||
Income (loss) from continuing operations | $ | 1.21 | $ | (0.02 | ) | $ | (0.81 | ) | ||||
Income (loss) from discontinued operations | 1.02 | (0.15 | ) | 0.15 | ||||||||
Basic and diluted earnings (loss) per share | $ | 2.23 | $ | (0.17 | ) | $ | (0.66 | ) | ||||
Amounts attributable to BRT Realty Trust: | ||||||||||||
Income (loss) from continuing operations | $ | 16,950 | $ | (246 | ) | $ | (11,550 | ) | ||||
Income (loss) from discontinued operations | 14,339 | (2,142 | ) | 2,096 | ||||||||
Net income (loss) attributable to common shareholders | $ | 31,289 | $ | (2,388 | ) | $ | (9,454 | ) | ||||
Weighted average number of common shares outstanding: | ||||||||||||
Basic and diluted | 14,017,279 | 14,133,352 | 14,265,589 |
Year Ended September 30, | ||||||||||||
2016 | 2015 | 2014 | ||||||||||
Net income (loss) | $ | 45,158 | $ | (1,605 | ) | $ | (16,166 | ) | ||||
Other comprehensive loss: | ||||||||||||
Unrealized loss on derivative instruments | (1,544 | ) | (50 | ) | (2 | ) | ||||||
Other comprehensive loss | (1,544 | ) | (50 | ) | (2 | ) | ||||||
Comprehensive income (loss) | 43,614 | (1,655 | ) | (16,168 | ) | |||||||
Comprehensive (income) loss attributable to non-controlling interests | (13,392 | ) | (776 | ) | 6,712 | |||||||
Comprehensive income (loss) attributable to common shareholders | $ | 30,222 | $ | (2,431 | ) | $ | (9,456 | ) |
Shares of Beneficial Interest | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | (Accumulated Deficit) | Non Controlling Interests | Total | ||||||||||||||||||
Balances, September 30, 2013 | $ | 40,606 | $ | 165,763 | $ | (6 | ) | $ | (67,572 | ) | $ | 26,467 | $ | 165,258 | |||||||||
Restricted stock vesting | 359 | (359 | ) | — | — | — | — | ||||||||||||||||
Compensation expense—restricted stock | — | 805 | — | — | — | 805 | |||||||||||||||||
Contributions from non-controlling interests | — | — | — | — | 22,062 | 22,062 | |||||||||||||||||
Distributions to non-controlling interests | — | — | — | — | (3,318 | ) | (3,318 | ) | |||||||||||||||
Net loss | — | — | — | (9,454 | ) | (6,712 | ) | (16,166 | ) | ||||||||||||||
Other comprehensive loss | — | — | (2 | ) | — | — | (2 | ) | |||||||||||||||
Comprehensive loss | — | — | — | — | — | (16,168 | ) | ||||||||||||||||
Balances, September 30, 2014 | $ | 40,965 | $ | 166,209 | $ | (8 | ) | $ | (77,026 | ) | $ | 38,499 | $ | 168,639 | |||||||||
Restricted stock vesting | 355 | (355 | ) | — | — | — | — | ||||||||||||||||
Compensation expense—restricted stock | — | 906 | — | — | — | 906 | |||||||||||||||||
Contributions from non-controlling interests | — | — | — | — | 11,973 | 11,973 | |||||||||||||||||
Distributions to non-controlling interests | — | — | — | — | (12,588 | ) | (12,588 | ) | |||||||||||||||
Purchase of non-controlling interests | — | (3,531 | ) | — | — | (1,148 | ) | (4,679 | ) | ||||||||||||||
Shares repurchased - 345,081 shares | (1,035 | ) | (1,387 | ) | — | — | (2,422 | ) | |||||||||||||||
Net loss | — | — | — | (2,388 | ) | 783 | (1,605 | ) | |||||||||||||||
Other comprehensive loss | — | — | (50 | ) | — | — | (50 | ) | |||||||||||||||
| | | | | | ||||||||||||||||||
Comprehensive loss | — | — | — | — | — | (1,655 | ) | ||||||||||||||||
Balances, September 30, 2015 | $ | 40,285 | $ | 161,842 | $ | (58 | ) | $ | (79,414 | ) | $ | 37,519 | $ | 160,174 | |||||||||
Restricted stock vesting | 390 | (390 | ) | — | — | — | — | ||||||||||||||||
Compensation expense—restricted stock and restricted stock units | — | 1,005 | — | — | — | 1,005 | |||||||||||||||||
Contributions from non-controlling interests | — | — | — | — | 33,613 | 33,613 | |||||||||||||||||
Distributions to non-controlling interests | — | — | — | — | (32,825 | ) | (32,825 | ) | |||||||||||||||
Deconsolidation of joint venture upon sale | (1,790 | ) | (1,790 | ) | |||||||||||||||||||
Shares repurchased - 326,421 shares | (979 | ) | (1,136 | ) | — | — | — | (2,115 | ) | ||||||||||||||
Net income | — | — | — | 31,289 | 13,869 | 45,158 | |||||||||||||||||
Other comprehensive loss | — | — | (1,544 | ) | — | — | (1,544 | ) | |||||||||||||||
Comprehensive income | — | — | — | — | — | 43,614 | |||||||||||||||||
Balances, September 30, 2016 | $ | 39,696 | $ | 161,321 | $ | (1,602 | ) | $ | (48,125 | ) | $ | 50,386 | $ | 201,676 |
Year Ended September 30, | ||||||||||||
2016 | 2015 | 2014 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net income (loss) | $ | 45,158 | $ | (1,605 | ) | $ | (16,166 | ) | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||||||
Recovery of previously provided allowances | — | — | (10 | ) | ||||||||
Depreciation and amortization | 25,994 | 22,957 | 17,535 | |||||||||
Amortization of deferred fee income | — | — | (393 | ) | ||||||||
Amortization of restricted stock | 1,005 | 906 | 805 | |||||||||
Gain on sale of partnership interests | (15,853 | ) | — | — | ||||||||
Gain on sale of real estate assets | (46,477 | ) | (15,005 | ) | — | |||||||
Loss on extinguishment of debt | 4,547 | — | — | |||||||||
Increase in straight line rent | (27 | ) | (411 | ) | (569 | ) | ||||||
Effect of deconsolidation of non-controlling interest | (1,692 | ) | — | — | ||||||||
Increases and decreases from changes in other assets and liabilities: | ||||||||||||
(Increase) decrease in interest and dividends receivable | (2,380 | ) | 17 | 273 | ||||||||
Increase in prepaid expenses | (278 | ) | (93 | ) | (548 | ) | ||||||
Increase in prepaid interest | — | (881 | ) | (1,016 | ) | |||||||
Increase in deposits and escrows | (6,190 | ) | (602 | ) | (5,963 | ) | ||||||
Increase in accounts payable and accrued liabilities | 4,897 | 1,739 | 7,416 | |||||||||
Increase (decrease) in security deposits and other receivables | 1,376 | 1,385 | (6,199 | ) | ||||||||
Net cash provided by (used in) operating activities | 10,080 | 8,407 | (4,835 | ) | ||||||||
Cash flows from investing activities: | ||||||||||||
Collections from real estate loans | — | 2,000 | 34,045 | |||||||||
Additions to real estate loans | — | — | (5,533 | ) | ||||||||
Loan loss recoveries | — | — | 10 | |||||||||
Additions to real estate properties | (302,628 | ) | (84,295 | ) | (205,220 | ) | ||||||
Net costs capitalized to real estate owned | (46,844 | ) | (59,407 | ) | (43,130 | ) | ||||||
Net change in restricted cash-Newark | (1,952 | ) | 9,558 | 6,444 | ||||||||
Net change in restricted cash-multi-family | (865 | ) | 3,037 | (6,195 | ) | |||||||
Collection of loan fees | — | — | 180 | |||||||||
Purchase of non controlling interest | — | (4,679 | ) | — | ||||||||
Proceeds from the sale of real estate owned | 197,264 | 66,398 | 75 | |||||||||
Proceeds from the sale of joint venture interests | 19,242 | — | — | |||||||||
Net cash used in investing activities | (135,783 | ) | (67,388 | ) | (219,324 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Proceeds from mortgages payable | 267,788 | 98,907 | 170,767 | |||||||||
Increase in other borrowed funds | 6,001 | — | — | |||||||||
Mortgage payoffs | (130,090 | ) | (37,504 | ) | — | |||||||
Mortgage principal payments | (5,081 | ) | (3,252 | ) | (1,577 | ) | ||||||
Increase in deferred borrowing costs | (2,490 | ) | (3,758 | ) | (2,641 | ) | ||||||
Capital contributions from non-controlling interests | 33,613 | 11,973 | 22,062 | |||||||||
Capital distributions to non-controlling interests | (32,826 | ) | (12,588 | ) | (3,318 | ) | ||||||
Proceeds from sale of New Markets Tax Credits | 2,746 | — | 5,142 | |||||||||
Repurchase of shares of beneficial interest | (2,115 | ) | (2,422 | ) | — | |||||||
Net cash provided by financing activities | 137,546 | 51,356 | 190,435 | |||||||||
Net increase (decrease) in cash and cash equivalents | 11,843 | (7,625 | ) | (33,724 | ) | |||||||
Cash and cash equivalents at beginning of year | 15,556 | 23,181 | 56,905 | |||||||||
Cash and cash equivalents at end of year | $ | 27,399 | $ | 15,556 | $ | 23,181 | ||||||
Supplemental disclosures of cash flow information: | ||||||||||||
Cash paid during the year for interest expense, including capitalized interest of $1,568, $2,602 and $1,310 in 2016, 2015 and 2014 | $ | 27,680 | $ | 24,324 | $ | 19,700 | ||||||
Cash paid during the year for income and excise taxes | $ | 1,264 | $ | 131 | $ | 255 | ||||||
Acquisition of real estate through assumption of debt | $ | 16,051 | $ | 45,129 | $ | 28,615 |
September 30, 2016 Balance | ||||
Land | $ | 128,409 | ||
Building | 684,133 | |||
Building improvements | 25,717 | |||
Real estate properties | 838,259 | |||
Accumulated depreciation | (44,687 | ) | ||
Total real estate properties, net | $ | 793,572 |
September 30, 2015 Balance | Additions | Capitalized Costs and Improvements | Sales | Depreciation, Amortization and other Reductions | September 30, 2016 Balance | ||||||||||||||||||
Multi-family | $ | 605,040 | $ | 318,680 | $ | 39,611 | $ | (157,174 | ) | $ | (23,072 | ) | $ | 783,085 | |||||||||
Land - Daytona, FL | 7,972 | — | 49 | — | — | 8,021 | |||||||||||||||||
Shopping centers/retail - Yonkers, NY | 2,574 | — | — | — | (108 | ) | 2,466 | ||||||||||||||||
| | | | | | ||||||||||||||||||
Total real estate properties | $ | 615,586 | $ | 318,680 | $ | 39,660 | $ | (157,174 | ) | $ | (23,180 | ) | $ | 793,572 |
Preliminary Purchase Price Allocation | |||
Land | $ | 53,054 | |
Buildings and Improvements | 264,474 | ||
Lease Intangibles | 1,152 | ||
Total Consideration | $ | 318,680 |
Preliminary Purchase Price Allocation | Adjustments | Finalized Purchase Price Allocation | |||||||||
Land | $ | 42,361 | $ | (6,568 | ) | $ | 35,793 | ||||
Buildings and Improvements | 260,107 | 4,999 | 265,106 | ||||||||
Acquisition-related intangible assets (in acquired lease intangibles, net) (1) | 733 | 1,569 | 2,302 | ||||||||
Total Consideration | $ | 303,201 | $ | — | $ | 303,201 |
Location | Number of Units at September 30, 2016 | 2016 Revenue | % of 2016 Revenue | |||||||
Texas | 2,750 | $ | 19,957 | 22 | % | |||||
Florida | 1,186 | 15,652 | 17 | % | ||||||
Georgia | 1,309 | 14,576 | 16 | % | ||||||
Tennessee | 456 | 9,735 | 11 | % | ||||||
Alabama | 826 | 6,966 | 8 | % | ||||||
South Carolina | 1,033 | 6,613 | 8 | % | ||||||
Missouri | 420 | 3,854 | 4 | % | ||||||
Indiana | 400 | 3,152 | 4 | % | ||||||
Kansas | — | 3,132 | 3 | % | ||||||
Mississippi | 776 | 2,678 | 3 | % | ||||||
Ohio | 264 | 2,440 | 3 | % | ||||||
Arkansas | — | 783 | 1 | % | ||||||
9,420 | $ | 89,538 | 100 | % |
Year Ending September 30, | Amount | |||
2017 | $ | 1,103 | ||
2018 | 1,120 | |||
2019 | 1,120 | |||
2020 | 1,120 | |||
2021 | 1,129 | |||
Thereafter | 5,685 | |||
Total | $ | 11,277 |
Location | Purchase Date | No. of Units | Purchase Price | Acquisition Mortgage Debt | Initial BRT Equity | Ownership Percentage | Property Acquisition Costs | ||||||||||||||||
N. Charleston, SC | 10/13/2015 | 271 | $ | 3,625 | $ | — | $ | 6,558 | 65 | % | $ | — | |||||||||||
La Grange, GA | 11/18/2015 | 236 | 22,800 | 16,051 | 6,824 | 100 | % | 57 | |||||||||||||||
Katy, TX | 1/22/2016 | 268 | 40,250 | 30,750 | 8,150 | 75 | % | 382 | |||||||||||||||
Macon, GA | 02/01/16 | 240 | 14,525 | 11,200 | 3,250 | 80 | % | 158 | |||||||||||||||
Southaven, MS | 2/29/2016 | 392 | 35,000 | 28,000 | 5,856 | 60 | % | 413 | |||||||||||||||
San Antonio, TX | 5/6/2016 | 288 | 35,150 | 26,400 | 6,688 | 65 | % | 539 | |||||||||||||||
Dallas, TX | 5/11/2016 | 494 | 37,000 | 27,938 | 6,750 | 50 | % | 567 | |||||||||||||||
Columbia, SC | 5/31/2016 | 204 | 17,000 | 12,934 | 4,930 | 80 | % | 302 | |||||||||||||||
Atlanta, GA | 8/15/2016 | 271 | 39,125 | 27,375 | 10,769 | 74 | % | 577 | |||||||||||||||
Southaven, MS | 9/1/2016 | 384 | 38,205 | 30,564 | 6,060 | 60 | % | 347 | |||||||||||||||
San Antonio, TX | 9/19/2016 | 288 | 36,000 | 27,000 | 8,060 | 72 | % | 510 | |||||||||||||||
3,336 | $ | 318,680 | $ | 238,212 | $ | 73,895 | $ | 3,852 |
Location | Purchase Date | No. of Units | Purchase Price | Acquisition Mortgage Debt | Initial BRT Equity | Ownership Percentage | Estimated Property Acquisition Costs | ||||||||||||||||
Fredricksburg, VA | 11/04/2016 | 220 | $ | 38,490 | $ | 29,940 | $ | 8,720 | 80 | % | $ | 643 | |||||||||||
Columbia, SC | 11/10/2016 | 374 | 58,300 | 41,000 | 5,670 | 32 | % | 71 | |||||||||||||||
Columbia, SC (1) | 11/10/2016 | 339 | 5,915 | — | 8,665 | 46 | % | — | |||||||||||||||
933 | $ | 102,705 | $ | 70,940 | $ | 23,055 | $ | 714 |
Location | Sale Date | No. of Units | Sales Price | Gain on Sale | Non-controlling partner portion of gain | |||||||||||
Cordova, TN | 3/2/2016 | 464 | 31,100 | 6,731 | 2,195 | |||||||||||
Kennesaw, GA | 3/15/2016 | 450 | 64,000 | 17,462 | 10,037 | |||||||||||
Pooler, GA | 4/6/2016 | 300 | 38,500 | 5,710 | 1,405 | |||||||||||
Collierville, TN | 6/1/2016 | 324 | 34,300 | 4,586 | 917 | |||||||||||
Little Rock, AK (1) | 6/6/2016 | 172 | 2,372 | 386 | — | |||||||||||
Wichita, KS | 9/1/2016 | 496 | 30,400 | 10,718 | 4,241 | |||||||||||
2,206 | $ | 200,672 | $ | 45,593 | $ | 18,795 |
Location | Sale Date | No. of Units | Sales Price | Gain on Sale | Non-controlling partner portion of gain | |||||||||||
Greenville, SC | 10/19/2016 | 350 | $ | 68,000 | $ | 18,937 | $ | 9,669 | ||||||||
Panama City, FL | 10/26/2016 | 160 | 14,720 | 7,390 | 3,732 | |||||||||||
Atlanta, GA | 11/21/2016 | 350 | 36,750 | 8,796 | 4,046 | |||||||||||
Hixon, TN | 11/30/2016 | 156 | 10,775 | 479 | 120 | |||||||||||
1,016 | $ | 130,245 | $ | 35,602 | $ | 17,567 |
Balance Sheet | September 30, 2015 | |||
ASSETS | ||||
Real estate properties, net | $ | 141,441 | ||
Restricted cash | 13,277 | |||
Deposits and escrows | 93 | |||
Other assets | 8,734 | |||
Total assets of discontinued operations | $ | 163,545 | ||
LIABILITIES | ||||
Mortgage payable, net of deferred costs of $9,683 | $ | 100,692 | ||
Accounts payable and accrued liabilities | 6,848 | |||
Deferred income | 30,990 | |||
Total liabilities of discontinued operations | $ | 138,530 |
Statement of Operations | ||||||||
Twelve Months Ended September 30, | ||||||||
2016 | 2015 | |||||||
Revenues: | ||||||||
Rental and other revenue from real estate properties | $ | 2,437 | $ | 4,335 | ||||
Other income | 444 | 1,067 | ||||||
Total revenues | 2,881 | 5,402 | ||||||
Expenses: | ||||||||
Real estate operating expenses | 2,277 | 4,610 | ||||||
Interest expense | 2,242 | 4,880 | ||||||
Depreciation | 1,150 | 2,241 | ||||||
Total expense | 5,669 | 11,731 | ||||||
Income from discontinued operations | (2,788 | ) | (6,329 | ) | ||||
Gain on sale of partnership interest | 15,467 | — | ||||||
Discontinued operations | $ | 12,679 | $ | (6,329 | ) |
September 30, | ||||||||||
2016 | 2015 | |||||||||
Mortgages payable | $ | 621,382 | $ | 475,312 | ||||||
Junior subordinated notes | 37,400 | 37,400 | ||||||||
Deferred mortgage costs | (6,275 | ) | (5,327 | ) | ||||||
Total debt obligations | $ | 652,507 | $ | 507,385 |
Year Ending September 30, | Scheduled Principal Payments | |||
2017 | $ | 5,649 | ||
2018 | 6,828 | |||
2019 | 127,067 | |||
2020 | 32,431 | |||
2021 | 46,683 | |||
Thereafter | 402,724 | |||
$ | 621,382 |
Location | Closing Date | Acquisition Mortgage Debt | Interest Rate | Interest only period | Maturity Date | |||||||
LaGrange, GA | 11/18/15 | $ | 16,051 | 4.36% | - | February 2022 | ||||||
Katy,TX | 1/22/16 | 30,750 | 4.44% | 60 months | February 2026 | |||||||
Macon,GA | 2/01/16 | 11,200 | 4.39% | 24 months | February 2026 | |||||||
Southaven, MS | 2/29/16 | 28,000 | 4.24% | 60 months | March 2026 | |||||||
San Antonio, TX (1) | 5/06/16 | 26,400 | 3.61% | 23 months | May 2023 | |||||||
Dallas,TX | 5/11/16 | 27,938 | 4.01% | 24 months | May 2028 | |||||||
Columbia,SC | 5/31/16 | 12,934 | 4.28% | 36 months | June 2026 | |||||||
Atlanta, GA | 8/15/16 | 27,375 | 3.97% | 36 months | August 2026 | |||||||
Southaven,MS | 9/01/16 | 30,564 | 3.73% | 60 months | September 2026 | |||||||
San Antonio, TX (1) | 9/16/16 | 27,000 | 4.05% | 36 months | September 2026 | |||||||
$ | 238,212 |
Location | Closing Date | Supplemental Mortgage Debt | Interest Rate | Maturity Date | ||||||
Pensacola, FL | 10/13/15 | $ | 3,194 | 4.92% | March 2022 | |||||
Atlanta, GA | 11/10/15 | 5,000 | 4.93% | July 2021 | ||||||
Houston, TX | 2/09/16 | 3,865 | 4.94% | August 2021 | ||||||
Huntsville,AL | 4/15/16 | 2,650 | 5.29% | November 2023 | ||||||
$ | 14,709 |
Years Ended September 30, | |||||||||
2016 | 2015 | 2014 | |||||||
Outstanding at beginning of the year | 672,875 | 648,225 | 627,425 | ||||||
Issued | 141,050 | 142,950 | 140,600 | ||||||
Cancelled | (16,850 | ) | — | (300 | ) | ||||
Vested | (130,300 | ) | (118,300 | ) | (119,500 | ) | |||
Outstanding at the end of the year | 666,775 | 672,875 | 648,225 |
Years Ended September 30, | |||||||||||
2016 | 2015 | 2014 | |||||||||
Restricted stock grants | $ | 859 | $ | 906 | $ | 805 | |||||
Restricted stock units | 146 | — | — | ||||||||
Total compensation | $ | 1,005 | $ | 906 | $ | 805 |
2016 | 2015 | 2014 | |||||||||
Numerator for basic and diluted earnings per share attributable to common shareholders: | |||||||||||
Net income (loss) attributable to common shareholders | $ | 31,289 | $ | (2,388 | ) | $ | (9,454 | ) | |||
Denominator: | |||||||||||
Denominator for basic earnings per share—weighted average shares | 14,017,279 | 14,133,352 | 14,265,589 | ||||||||
Denominator for diluted earnings per share—adjusted weighted average shares and assumed conversions | 14,017,279 | 14,133,352 | 14,265,589 | ||||||||
Basic earnings (loss) per share | $ | 2.23 | $ | (0.17 | ) | $ | (0.66 | ) | |||
Diluted earnings (loss) per share | $ | 2.23 | $ | (0.17 | ) | $ | (0.66 | ) |
Multi-Family Real Estate | Other Real Estate | Total | ||||||||||
Revenues: | ||||||||||||
Rental and other revenues from real estate properties | $ | 89,538 | $ | 1,407 | $ | 90,945 | ||||||
Other income | — | 3,319 | 3,319 | |||||||||
Total revenues | 89,538 | 4,726 | 94,264 | |||||||||
Expenses: | ||||||||||||
Real estate operating expenses | 42,679 | 583 | 43,262 | |||||||||
Interest expense | 23,739 | 139 | 23,878 | |||||||||
Advisor's fee, related party | 593 | 100 | 693 | |||||||||
Property acquisition costs | 3,852 | — | 3,852 | |||||||||
General and administrative | 8,313 | 223 | 8,536 | |||||||||
Provision for federal taxes | 686 | 14 | 700 | |||||||||
Depreciation | 22,251 | 929 | 23,180 | |||||||||
Total expenses | 102,113 | 1,988 | 104,101 | |||||||||
Total revenues less total expenses | (12,575 | ) | 2,738 | (9,837 | ) | |||||||
Gain on sale of real estate | 45,206 | 1,271 | 46,477 | |||||||||
Gain on sale of partnership interest | 386 | — | 386 | |||||||||
Loss on extinguishment of debt | (4,547 | ) | — | (4,547 | ) | |||||||
Income from continuing operations | 28,470 | 4,009 | 32,479 | |||||||||
Net (income) attributable to non-controlling interests | (15,420 | ) | (108 | ) | (15,528 | ) | ||||||
Net income attributable to common shareholders before reconciling items | $ | 13,050 | $ | 3,901 | $ | 16,951 | ||||||
Reconciling adjustment: | ||||||||||||
Discontinued operations, net of non controlling interests | 14,338 | |||||||||||
Net income attributable to common shareholders | $ | 31,289 | ||||||||||
Segment assets at September 30, 2016 | $ | 844,430 | $ | 31,001 |
Multi-Family Real Estate | Other Real Estate | Total | ||||||||||
Revenues: | ||||||||||||
Rental and other revenues from real estate properties | $ | 75,643 | $ | 1,380 | $ | 77,023 | ||||||
Other income | — | 72 | 72 | |||||||||
Total revenues | 75,643 | 1,452 | 77,095 | |||||||||
Expenses: | ||||||||||||
Real estate operating expenses | 38,000 | 609 | 38,609 | |||||||||
Interest expense | 18,944 | 353 | 19,297 | |||||||||
Advisor's fee, related party | 2,077 | 371 | 2,448 | |||||||||
Property acquisition costs | 1,885 | — | 1,885 | |||||||||
General and administrative | 6,314 | 369 | 6,683 | |||||||||
Depreciation | 18,336 | 118 | 18,454 | |||||||||
Total expenses | 85,556 | 1,820 | 87,376 | |||||||||
Total revenues less total expenses | (9,913 | ) | (368 | ) | (10,281 | ) | ||||||
Gain on sale of real estate | 14,404 | 601 | 15,005 | |||||||||
Income (loss) from continuing operations | 4,491 | 233 | 4,724 | |||||||||
Net (income) loss attributable to non-controlling interests | (4,877 | ) | (93 | ) | (4,970 | ) | ||||||
Net income (loss) attributable to common shareholders before reconciling adjustment | $ | (386 | ) | $ | 140 | $ | (246 | ) | ||||
Reconciling adjustment: | ||||||||||||
Discontinued operations, net of non controlling interests | (2,142 | ) | ||||||||||
Net income attributable to common shareholders | $ | (2,388 | ) | |||||||||
Segment assets at September 30, 2015 | $ | 616,909 | $ | 55,425 |
Multi-Family Real Estate | Other Real Estate | Total | ||||||||||
Revenues: | ||||||||||||
Rental and other revenues from real estate properties | $ | 60,362 | $ | 1,363 | $ | 61,725 | ||||||
Other income | 4 | 84 | 88 | |||||||||
Total revenues | 60,366 | 1,447 | 61,813 | |||||||||
Expenses: | ||||||||||||
Operating expenses relating to real estate properties | 32,347 | 637 | 32,984 | |||||||||
Interest expense | 16,212 | 222 | 16,434 | |||||||||
Advisor's fee, related party | 1,466 | 335 | 1,801 | |||||||||
Property acquisition costs | 2,542 | — | 2,542 | |||||||||
General and administrative | 5,887 | 437 | 6,324 | |||||||||
Depreciation | 13,828 | 117 | 13,945 | |||||||||
Total expenses | 72,282 | 1,748 | 74,030 | |||||||||
Loss from continuing operations | (11,916 | ) | (301 | ) | (12,217 | ) | ||||||
Plus: net loss attributable to non-controlling interests | 759 | (92 | ) | 667 | ||||||||
Net (loss) income attributable to common shareholders before reconciling adjustments | $ | (11,157 | ) | $ | (393 | ) | $ | (11,550 | ) | |||
Reconciling adjustment: | ||||||||||||
Other income | 65 | |||||||||||
Discontinued operations, net of non controlling interests | 2,031 | |||||||||||
Net loss attributable to common shareholders | $ | (9,454 | ) | |||||||||
Segment assets at September 30, 2014 | $ | 569,357 | $ | 31,075 |
Carrying and Fair Value | Fair Value Measurements Using Fair Value Hierarchy | ||||||||||
Level 1 | Level 2 | ||||||||||
Financial Liabilities: | |||||||||||
Interest rate swap | $ | (1,602 | ) | — | $ | (1,602 | ) |
Interest Rate Derivative | Notional Amount | Rate | Maturity | ||||||
Interest Rate Swap | $ | 1,559 | 5.25 | % | April 1, 2022 | ||||
Interest Rate Swap | $ | 26,400 | 3.61 | % | May 6, 2023 | ||||
Interest Rate Swap | $ | 27,000 | 4.05 | % | September 19, 2026 |
Derivatives as of: | ||||||||||
September 30, 2016 | September 30, 2015 | |||||||||
Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | |||||||
Other Assets | $ | — | Other assets | $ | — | |||||
Accounts payable and accrued liabilities | $ | 1,602 | Accounts payable and accrued liabilities | $ | 58 |
Year Ended September 30, | ||||||||||||
2016 | 2015 | 2014 | ||||||||||
Amount of loss recognized on derivative in Other Comprehensive Income | $ | (1,695 | ) | $ | (83 | ) | $ | (37 | ) | |||
Amount of loss reclassified from Accumulated Other Comprehensive (loss) income into Interest Expense | $ | (150 | ) | $ | (33 | ) | $ | (36 | ) |
2016 | ||||||||||||||||||||
1st Quarter Oct. - Dec | 2nd Quarter Jan. - March | 3rd Quarter April - June | 4th Quarter July - Sept. | Total For Year | ||||||||||||||||
Revenues | $ | 21,405 | $ | 24,857 | $ | 23,245 | $ | 24,757 | $ | 94,264 | ||||||||||
Expenses | 23,187 | 25,849 | 26,610 | 28,455 | 104,101 | |||||||||||||||
Total revenues less total expenses | (1,782 | ) | (992 | ) | (3,365 | ) | (3,698 | ) | (9,837 | ) | ||||||||||
Gain on sale of real estate | 609 | 24,226 | 10,263 | 11,379 | 46,477 | |||||||||||||||
Gain on sale of partnership interest | — | — | 386 | — | 386 | |||||||||||||||
Loss on extinguishment of debt | — | (2,668 | ) | — | (1,879 | ) | (4,547 | ) | ||||||||||||
(Loss) income from continuing operations | (1,173 | ) | 20,566 | 7,284 | 5,802 | 32,479 | ||||||||||||||
(Loss) income from discontinued operations | (1,600 | ) | 14,279 | — | — | 12,679 | ||||||||||||||
Net (loss) income | (2,773 | ) | 34,845 | 7,284 | 5,802 | 45,158 | ||||||||||||||
Net loss (income) attributable to non-controlling interests | 739 | (9,909 | ) | (1,804 | ) | (2,895 | ) | (13,869 | ) | |||||||||||
Net (loss) income attributable to common shareholders | $ | (2,034 | ) | $ | 24,936 | $ | 5,480 | $ | 2,907 | $ | 31,289 | |||||||||
Basic and per share amounts attributable to common shareholders | ||||||||||||||||||||
Continuing operations | $ | (0.10 | ) | $ | 0.70 | $ | 0.39 | $ | 0.21 | $ | 1.21 | |||||||||
Discontinued operations | (0.04 | ) | 1.06 | — | — | 1.02 | ||||||||||||||
Basic and diluted (loss) income per share | $ | (0.14 | ) | $ | 1.76 | $ | 0.39 | $ | 0.21 | $ | 2.23 |
2015 | ||||||||||||||||||||
1st Quarter Oct. - Dec | 2nd Quarter Jan. - March | 3rd Quarter April - June | 4th Quarter July - Sept. | Total For Year | ||||||||||||||||
Revenues | $ | 18,526 | $ | 19,123 | $ | 19,790 | $ | 19,656 | $ | 77,095 | ||||||||||
Expenses | 20,320 | 20,838 | 21,596 | 24,622 | 87,376 | |||||||||||||||
Total revenues less total expenses | (1,794 | ) | (1,715 | ) | (1,806 | ) | (4,966 | ) | (10,281 | ) | ||||||||||
Gain on sale of real estate | — | 2,777 | — | 12,228 | 15,005 | |||||||||||||||
(Loss) income from continuing operations | (1,794 | ) | 1,062 | (1,806 | ) | 7,262 | 4,724 | |||||||||||||
Loss from discontinued operations | (1,733 | ) | (1,448 | ) | (1,702 | ) | (1,446 | ) | (6,329 | ) | ||||||||||
Net (loss) income | (3,527 | ) | (386 | ) | (3,508 | ) | 5,816 | (1,605 | ) | |||||||||||
Net loss (income) attributable to non-controlling interests | 1,029 | (362 | ) | 930 | (2,380 | ) | (783 | ) | ||||||||||||
Net (loss) income attributable to common shareholders | $ | (2,498 | ) | $ | (748 | ) | $ | (2,578 | ) | $ | 3,436 | $ | (2,388 | ) | ||||||
Basic and per share amounts attributable to common shareholders | ||||||||||||||||||||
Continuing operations | $ | (0.15 | ) | $ | (0.01 | ) | $ | (0.13 | ) | $ | 0.27 | $ | (0.02 | ) | ||||||
Discontinued operations | (0.03 | ) | (0.04 | ) | (0.05 | ) | (0.03 | ) | (0.15 | ) | ||||||||||
Basic and diluted (loss) income per share | $ | (0.18 | ) | $ | (0.05 | ) | $ | (0.18 | ) | $ | 0.24 | $ | (0.17 | ) |
Initial Cost to Company | Costs Capitalized Subsequent to Acquisition | Gross Amount At Which Carried at September 30, 2016 | Depreciation Life For Latest Income Statement | ||||||||||||||||||||||||||||||||||||||||||||||
Description | Encumbrances | Land | Buildings and Improvements | Land | Improvements | Carrying Costs | Land | Buildings and Improvements | Total | Accumulated Depreciation | Date of Construction | Date Acquired | |||||||||||||||||||||||||||||||||||||
Commercial | |||||||||||||||||||||||||||||||||||||||||||||||||
Yonkers, NY. | $ | 1,560 | — | $ | 4,000 | — | $ | 194 | — | — | $ | 4,194 | $ | 4,194 | $ | 1,727 | (c) | Aug-2000 | 39 years | ||||||||||||||||||||||||||||||
South Daytona, FL. | — | $ | 10,437 | — | 49 | — | — | $ | 8,021 | — | 8,021 | — | N/A | Feb-2008 | N/A | ||||||||||||||||||||||||||||||||||
Multi-Family Residential | |||||||||||||||||||||||||||||||||||||||||||||||||
Palm Beach Gardens, FL | 47,125 | 16,260 | 43,132 | — | 4,420 | — | 16,260 | 47,552 | 63,812 | 8,054 | 1970 | Mar-2012 | 30 years | ||||||||||||||||||||||||||||||||||||
Melbourne, FL | 9,211 | 1,150 | 8,680 | — | 1,414 | — | 1,150 | 10,094 | 11,244 | 1,900 | 1987 | Mar-2012 | 30 years | ||||||||||||||||||||||||||||||||||||
North Charleston, SC | 17,130 | 2,436 | 18,970 | — | 1,002 | — | 2,436 | 19,972 | 22,408 | 2,871 | 2010 | Oct-2012 | 30 years | ||||||||||||||||||||||||||||||||||||
Decatur, GA | 10,352 | 1,697 | 8,676 | — | 1,413 | — | 1,697 | 10,089 | 11,786 | 1,379 | 1954 | Nov-2012 | 30 years | ||||||||||||||||||||||||||||||||||||
Panama City, FL | 5,336 | 1,411 | 5,745 | — | 716 | — | 1,411 | 6,461 | 7,872 | 952 | 1987 | Jan-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Houston, TX (Stone) | 12,899 | 5,143 | 11,524 | — | 400 | — | 5,143 | 11,924 | 17,067 | 1,503 | 1978 | April-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Houston, TX (Pathways) | 7,398 | 3,044 | 5,463 | — | 838 | — | 3,044 | 6,301 | 9,345 | 753 | 1979 | April-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Hixon, TN | 8,117 | 1,231 | 9,561 | — | 298 | — | 1,231 | 9,859 | 11,090 | 1,137 | 1989 | May-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Pasadena, TX (Ashwood) | 3,988 | 1,513 | 3,864 | — | 429 | — | 1,513 | 4,293 | 5,806 | 502 | 1984 | Oct-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Humble, TX (Parkside) | 4,930 | 1,113 | 5,534 | — | 467 | — | 1,113 | 6,001 | 7,114 | 677 | 1983 | Oct-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Humble, TX (Meadowbrook) | 7,726 | 1,996 | 8,425 | — | 794 | — | 1,996 | 9,219 | 11,215 | 1,003 | 1982 | Oct-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Huntsville, AL | 12,212 | 1,047 | 10,942 | — | 1,439 | — | 1,047 | 12,381 | 13,428 | 1,339 | 1985 | Oct-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Columbus, OH | 10,164 | 2,810 | 11,240 | — | 315 | — | 2,810 | 11,555 | 14,365 | 1,450 | 1999 | Nov-2013 | 30 years | ||||||||||||||||||||||||||||||||||||
Indianapolis, IN | 14,500 | 4,477 | 14,240 | — | 1,997 | — | 4,477 | 16,237 | 20,714 | 1,573 | 2007 | Jan-2014 | 30 years | ||||||||||||||||||||||||||||||||||||
Greenville, SC | 37,961 | 7,487 | — | — | 41,680 | 608 | 7,487 | 42,288 | 49,775 | 1,665 | 2014 | Jan-2014 | 30 years | ||||||||||||||||||||||||||||||||||||
Nashville, TN | 23,623 | 4,565 | 22,054 | — | 2,239 | — | 4,565 | 24,293 | 28,858 | 2,001 | 1985 | April-2014 | 30 years | ||||||||||||||||||||||||||||||||||||
Atlanta, GA | 27,052 | 2,283 | 25,921 | — | 670 | — | 2,283 | 26,591 | 28,874 | 1,799 | 2009 | June-2014 | 30 years | ||||||||||||||||||||||||||||||||||||
Houston, TX (Kendall) | 15,314 | 1,849 | 13,346 | — | 1,557 | — | 1,849 | 14,903 | 16,752 | 1,264 | 1981 | July-2014 | 30 years | ||||||||||||||||||||||||||||||||||||
Pensacola, FL | 19,750 | 2,758 | 25,192 | — | 521 | — | 2,758 | 25,713 | 28,471 | 1,826 | 2008 | Dec-2014 | 30 years | ||||||||||||||||||||||||||||||||||||
Valley, AL | 28,990 | 1,040 | 42,710 | — | 455 | — | 1,040 | 43,165 | 44,205 | 2,130 | 2009 | July-2014 | 30 years | ||||||||||||||||||||||||||||||||||||
San Marcos, TX | 17,158 | 2,163 | 19,562 | — | 183 | — | 2,163 | 19,745 | 21,908 | 974 | 2014 | Sept-2015 | 30 years | ||||||||||||||||||||||||||||||||||||
Lake St. Louis, MO | 27,397 | 2,752 | 33,248 | — | 421 | — | 2,752 | 33,669 | 36,421 | 1,360 | 1986 | Sept-2015 | 30 years | ||||||||||||||||||||||||||||||||||||
North Charleston, SC | 13,544 | 3,704 | — | — | 21,131 | 55 | 3,704 | 21,186 | 24,890 | — | 2016 | Oct-15 | 30 years | ||||||||||||||||||||||||||||||||||||
LaGrange, GA | 15,786 | 832 | 21,968 | — | 389 | — | 832 | 22,357 | 23,189 | 770 | 2009 | Nov-15 | 30 years | ||||||||||||||||||||||||||||||||||||
Katy, TX | 30,750 | 4,194 | 36,056 | — | 240 | — | 4,194 | 36,296 | 40,490 | 1,149 | 2008 | Jan-16 | 30 years | ||||||||||||||||||||||||||||||||||||
Macon, GA | 11,200 | 1,876 | 12,649 | — | 180 | — | 1,876 | 12,829 | 14,705 | 389 | 1988 | Feb-16 | 30 years | ||||||||||||||||||||||||||||||||||||
Southaven, MS | 28,000 | 2,090 | 32,910 | — | 1,286 | — | 2,090 | 34,196 | 36,286 | 812 | 2002 | Feb-16 | 30 years | ||||||||||||||||||||||||||||||||||||
San Antonio, TX | 26,400 | 5,540 | 29,610 | — | 443 | — | 5,540 | 30,053 | 35,593 | 728 | 2013 | May-16 | 30 years | ||||||||||||||||||||||||||||||||||||
Dallas, TX | 27,937 | 13,073 | 23,927 | — | 917 | — | 13,073 | 24,844 | 37,917 | 409 | 1986 | May-16 | 30 years | ||||||||||||||||||||||||||||||||||||
Columbia, SC | 12,934 | 2,233 | 14,767 | — | 93 | — | 2,233 | 14,860 | 17,093 | 284 | 1996 | May-16 | 30 years | ||||||||||||||||||||||||||||||||||||
Initial Cost to Company | Costs Capitalized Subsequent to Acquisition | Gross Amount At Which Carried at September 30, 2016 | Depreciation Life For Latest Income Statement | ||||||||||||||||||||||||||||||||||||||||||||||
Description | Encumbrances | Land | Buildings and Improvements | Land | Improvements | Carrying Costs | Land | Buildings and Improvements | Total | Accumulated Depreciation | Date of Construction | Date Acquired | |||||||||||||||||||||||||||||||||||||
Atlanta, GA | 27,375 | 9,491 | 29,634 | — | 7 | — | 9,491 | 29,641 | 39,132 | 155 | 1989 | Aug-16 | 30 years | ||||||||||||||||||||||||||||||||||||
Southaven, MS | 30,563 | 2,100 | 36,105 | — | 14 | — | 2,100 | 36,119 | 38,219 | 100 | 2005 | Sep-16 | 30 years | ||||||||||||||||||||||||||||||||||||
San Antonio, TX | 27,000 | 5,030 | 30,970 | — | — | — | 5,030 | 30,970 | 36,000 | 52 | 2015 | Sep-16 | 30 years | ||||||||||||||||||||||||||||||||||||
Total | $ | 621,382 | $ | 130,825 | $ | 620,625 | $ | 49 | $ | 88,562 | $ | 663 | $ | 128,409 | $ | 709,850 | $ | 838,259 | $ | 44,687 | |||||||||||||||||||||||||||||
(a) | (b) |
(a) | Total real estate properties | $ | 838,259 | |
Less: Accumulated depreciation and amortization | (44,687 | ) | ||
Net real estate properties | $ | 793,572 | ||
(b) | Amortization of the Trust's leasehold interests is over the shorter of estimated useful life or the term of the respective land lease. | |||
(c) | Information not readily obtainable. |
2016 | 2015 | 2014 | ||||||||||
Balance at beginning of year | $ | 757,027 | $ | 635,612 | $ | 402,896 | ||||||
Additions: | ||||||||||||
Acquisitions | 318,680 | 129,425 | 205,220 | |||||||||
Capital improvements | 19,649 | 8,442 | 8,273 | |||||||||
Capitalized development expenses and carrying costs | 27,194 | 55,623 | 34,857 | |||||||||
365,523 | 193,490 | 248,350 | ||||||||||
Deductions: | ||||||||||||
Sales | 150,786 | 51,394 | 80 | |||||||||
Depreciation/amortization/paydowns | 24,328 | 20,681 | 15,554 | |||||||||
Reconciliation of partnership interest | 153,864 | — | — | |||||||||
328,978 | 72,075 | 15,634 | ||||||||||
Balance at end of year | $ | 793,572 | $ | 757,027 | 635,612 |
COMPANY | STATE OF ORGANIZATION | |
TRB No. 1 Corp. | New York | |
TRB 69th Street Corp. | New York | |
TRB Yonkers Corp. | New York | |
TRB Lawrence Realty Corp. | New York | |
TRB Apopka LLC | Florida | |
TRB West Palm Two LLC | Florida | |
TRB Daytona LLC | Florida | |
TRB Newark Assemblage LLC | New Jersey | |
TRB Newark TRS LLC | New Jersey | |
BRT RLOC LLC | New York | |
TRB Ivy Ridge LLC | Delaware | |
TRB Union Palm LLC | Delaware | |
TRB Lawrenceville LLC | Delaware | |
TRB Melbourne LLC | Delaware | |
TRB Schilling LLC | Delaware | |
TRB Silvana LLC | Delaware | |
TRB Avondale LLC | Delaware | |
TRB Grove at Trinity LLC | Delaware | |
TRB Courtney Station LLC | Delaware | |
TRB Spring Valley LLC | Delaware | |
TRB Columbus LLC | Delaware | |
TRB Houston Galleria LLC | Delaware | |
TRB Autumn Brook LLC | Delaware | |
TRB Arlington LLC | Delaware | |
TRB Mountain Park LLC | Delaware | |
TRB Houston Four Pack LLC | Delaware | |
TRB South Ridge LLC | Delaware | |
TRB Waterside LLC | Delaware | |
TRB Triple Play LLC | Delaware | |
TRB Sandtown LLC | Delaware | |
TRB Kendall Manor LLC | Delaware | |
TRB Avalon LLC | Delaware | |
Avalon 276 LLC | Delaware | |
TRB Avondale LLC | Delaware | |
TRB Avondale Investor LLC | Delaware | |
TRB Holdings LLC | Delaware | |
TRB Venues LLC | Delaware | |
TRB Cedar Lakes LLC | Delaware | |
TRB Factory LLC | Delaware | |
TRB Parkway Grande LLC | Delaware | |
TRB Woodlands LLC | Delaware | |
Woodlands 236 LLC | Delaware | |
TRB Cinco Ranch LLC | Delaware | |
TRB River Place LLC | Delaware | |
TRB Civic Center LLC | Delaware | |
TRB Shavano LLC | Delaware | |
TRB Chatham LLC | Delaware | |
TRB Waters Edge LLC | Delaware | |
TRB Lenox Park LLC | Delaware | |
TRB Alamo LLC | Delaware |
/s/ BDO USA LLP |
Date: December 13, 2016 | /s/ Jeffrey A. Gould | |
Jeffrey A. Gould President and Chief Executive Officer (Principal Executive Officer) |
Date: December 13, 2016 | /s/ David W. Kalish | |
David W. Kalish Senior Vice President-Finance |
Date: December 13, 2016 | /s/ George Zweier | |
George Zweier Vice President (Principal Financial and Accounting Officer) |
Date: December 13, 2016 | /s/ Jeffrey A. Gould | |
Jeffrey A. Gould President and Chief Executive Officer (Principal Executive Officer) |
Date: December 13, 2016 | /s/ David W. Kalish | |
David W. Kalish Senior Vice President-Finance |
Date: December 13, 2016 | /s/ George Zweier | |
George Zweier Vice President (Principal Financial and Accounting Officer) |
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Document and Entity Information - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Dec. 01, 2016 |
Mar. 31, 2016 |
|
Document and Entity Information | |||
Entity Registrant Name | BRT REALTY TRUST | ||
Entity Central Index Key | 0000014846 | ||
Document Type | 10-K | ||
Document Period End Date | Sep. 30, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 54.4 | ||
Entity Common Stock, Shares Outstanding | 13,898,835 | ||
Document Fiscal Year Focus | 2016 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Sep. 30, 2015 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Real estate properties, net of accumulated depreciation | $ 41,995 | $ 34,142 |
Debt Issuance Costs, Net | $ 6,275 | $ 5,327 |
Preferred shares, par value (in dollars per share) | $ 1.0 | $ 1.0 |
Preferred shares, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred shares, issued (in shares) | 0 | 0 |
Shares of beneficial interest, par value (in dollars per share) | $ 3.0 | $ 3.0 |
Shares of beneficial interest, issued (in shares) | 13,232,000 | 13,428,000 |
Debt Instrument [Line Items] | ||
Commitments and contingencies | ||
Mortgages | ||
Statement of Financial Position [Abstract] | ||
Debt Issuance Costs, Net | 5,873 | 4,905 |
Junior subordinated notes | ||
Statement of Financial Position [Abstract] | ||
Debt Issuance Costs, Net | $ 402 | $ 422 |
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Income Statement [Abstract] | |||
Real estate operating expenses | $ 1,950 | $ 1,233 | $ 1,120 |
Property acquisition costs, related party | 2,221 | 1,293 | 1,677 |
General and administrative, related party | 1,020 | 171 | 286 |
Loss from discontinued operations, related party | $ 0 | $ 0 | $ 214 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 45,158 | $ (1,605) | $ (16,166) |
Other comprehensive loss: | |||
Unrealized loss on derivative instruments | (1,544) | (50) | (2) |
Other comprehensive loss | (1,544) | (50) | (2) |
Comprehensive income (loss) | 43,614 | (1,655) | (16,168) |
Comprehensive (income) loss attributable to non-controlling interests | (13,392) | (776) | 6,712 |
Comprehensive income (loss) attributable to common shareholders | $ 30,222 | $ (2,431) | $ (9,456) |
CONSOLIDATED STATEMENT OF EQUITY (Parenthetical) - shares |
12 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Statement of Stockholders' Equity [Abstract] | ||
Shares repurchased (in shares) | 326,421 | 345,081 |
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Supplemental Cash Flow Information [Abstract] | |||
Capitalized interest | $ 1,568 | $ 2,602 | $ 1,310 |
ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES |
12 Months Ended |
---|---|
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES | ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES Organization and Background BRT Realty Trust (“BRT” or the “Trust”) is a business trust organized in Massachusetts. BRT owns, operates and develops multi‑family properties and owns and operates other assets, including real estate and a real estate loan. Generally, the multi‑family properties are acquired with venture partners in transactions in which the Trust contributes 80% of the equity. At September 30, 2016, the Trust owns 33 multi-family properties with 9,420 units located in 10 states (including 271 units at a property under construction and 350 units at a property in the lease up stage). At September 30, 2016, the net book value of the multi-family assets (including real estate assets held for sale) was $783,084,000. The Trust also owns and operates various other real estate assets. At September 30, 2016, the net book value of the other real estate assets was $29,989,000, including a real estate loan of $19,500,000. BRT conducts its operations to qualify as a real estate investment trust, or REIT, for Federal income tax purposes. Principles of Consolidation The consolidated financial statements include the accounts and operations of BRT Realty Trust, its wholly owned subsidiaries, and its majority owned or controlled real estate entities and its interests in variable interest entities in which the Trust is determined to be the primary beneficiary. Material intercompany balances and transactions have been eliminated. The Trust's consolidated joint ventures that own multi-family properties were determined to be VIE's because the voting rights of some equity investors are not proportional to their obligations to absorb the expected losses of the entity and their right to receive the expected residual returns. It was determined that the Trust is the primary beneficiary of these joint ventures because it has a controlling financial interest in that it has the power to direct the activities of the VIE that most significantly impact the entity's economic performance and it has the obligation to absorb losses of the entity and the right to receive benefits from the entity that could potentially be significant to the VIE. The joint venture that owns a property in Dallas, TX was determined not to be a VIE but is consolidated because the Trust has substantive participating rights in the entity. With respect to its unconsolidated joint ventures, as (i) the Trust is primarily the managing member but does not exercise substantial operating control over these entities or the Trust is not the managing member and (ii) such entities are not VIEs, the Trust has determined that such joint ventures should be accounted for under the equity method of accounting for financial statement purposes. Certain items on the consolidated financial statements for the prior years have been reclassified to conform with the current year's presentation, including the reclassification of the operations and related assets of the Newark Joint Venture to discontinued operations and the reclassification of deferred loan costs on the consolidated balance sheets from assets to a reduction of the carrying amount of mortgage payable. Income Tax Status The Trust qualifies as a real estate investment trust under sections 856-860 of the Internal Revenue Code of 1986, as amended. The Trustees may, at their option, elect to operate the Trust as a business trust not qualifying as a real estate investment trust. The Trust will not be subject to federal, and generally state and local taxes on amounts it distributes to shareholders, provided it distributes 90% of its taxable income and meets other conditions. The Trust currently has net operating loss carryforwards which it can use to reduce taxable income. Use of the net operating loss carryforward is subject to an alternative minimum tax. NOTE 1—ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES (continued) In accordance with Accounting Standards Codification ("ASC") Topic 740 - "Income Taxes", the Trust believes that it has appropriate support for the income tax positions taken and, as such, does not have any uncertain tax positions that, if successfully challenged, could result in a material impact on the Trust's financial position or results of operations. The Trust's income tax returns for the previous six years are subject to review by the Internal Revenue Service. Revenue Recognition Rental revenue from multi-family properties is recorded when due from residents and is recognized monthly as it is earned. Rental payments are due in advance. Leases on residential properties are generally for terms that do not exceed one year. Rental revenue from commercial properties, including the base rent that each tenant is required to pay in accordance with the terms of their respective leases, net of any rent concessions and lease incentives, is reported on a straight-line basis over the non-cancellable term of the lease. Real Estate Properties Real estate properties are stated at cost, net of accumulated depreciation, and include real property acquired through acquisition, development or foreclosure. The Trust assesses the fair value of real estate acquired (including land, buildings and improvements, and identified intangibles such as above and below market leases and acquired in-place leases, if any) and acquired liabilities and allocates the acquisition price based on these assessments. Depreciation for multi-family properties is computed on a straight-line basis over an estimated useful life of 30 years. Intangible assets (and liabilities) are amortized over the remaining life of the related leases at the time of acquisition and is usually less than one year. . Expenditures for maintenance and repairs are charged to operations as incurred. Real estate is classified as held for sale when management has determined that it has met the applicable criteria. Real estate assets that are expected to be disposed of are valued at the lower of their carrying amount or their fair value less costs to sell on an individual asset basis. Real estate classified as held for sale is not depreciated. The Trust accounts for the sale of real estate when title passes to the buyer, sufficient equity payments have been received, there is no continuing involvement by the Trust and there is reasonable assurance that the remaining receivable, if any, will be collected. Real Estate Asset Impairments The Trust reviews each real estate asset owned, including investments in real estate ventures, to determine if there are indicators of impairment. If such indicators are present, the Trust determines whether the carrying amount of the asset can be recovered. Recognition of impairment is required if the undiscounted cash flows estimated to be generated by the asset are less than the asset's carrying amount and that carrying amount exceeds the estimated fair value of the asset. In evaluating a property for impairment, various factors are considered, including estimated current and expected operating cash flow from the property during the projected holding period, costs necessary to extend the life or improve the asset, expected capitalization rates, projected stabilized net operating income, selling costs, and the ability to hold and dispose of such real estate in the ordinary course of business. Valuation adjustments may be necessary in the event that effective interest rates, rent-up periods, future economic conditions, and other relevant factors vary significantly from those assumed in valuing the property. If future evaluations result in a decrease in the value of the property below its carrying value, the reduction will be recognized as an impairment charge. The fair values related to the impaired real estate assets are considered to be a level 3 valuation within the fair value hierarchy. Fixed Asset Capitalization A variety of costs may be incurred in the development of the Trust's properties. After a determination is made to capitalize a cost, it is allocated to the specific project that is benefited. The costs of land and building under development include specifically identifiable costs. The capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, and other costs incurred during the period of development. A construction project is considered substantially completed when it is available for occupancy, but no later than NOTE 1—ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES (continued) one year from cessation of major construction activity. The Trust ceases capitalization when the project is available for occupancy. Equity Based Compensation Compensation expense for grants of restricted stock and restricted stock units ("RSUs") are amortized over the vesting period of such awards, based upon the estimated fair value of such award at the grant date. The deferred compensation related to the RSUs to be recognized as expense is net of certain and performance assumptions which are re-evaluated quarterly. For accounting purposes, the restricted shares are not included in the outstanding shares shown on the consolidated balance sheets until they vest; however, they are included in the calculation of both basic and diluted earnings per share as they participate in the earnings of the Trust. Derivatives and Hedging Activities The Trust's objective in using derivative financial instruments is to manage interest rate risk related to variable rate debt. The Trust does not use derivatives for trading or speculative purposes. The Trust records all derivatives on its consolidated balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Trust has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows are considered cash flow hedges. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in accumulated other comprehensive income (loss) and subsequently reclassified to earnings in the period in which the hedge transaction affects earnings. The ineffective portion of changes in the fair value of the derivative is recognized directly in earnings. For derivatives not designated as cash flow hedges, changes in the fair value of the derivative are recognized directly in earnings in the period in which they occur. Per Share Data Basic earnings (loss) per share is determined by dividing net income (loss) applicable to common shareholders for the applicable year by the weighted average number of shares of beneficial interest outstanding during such year. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue shares of beneficial interest were exercised or converted into shares of beneficial interest or resulted in the issuance of shares of beneficial interest that share in the earnings of the Trust. Diluted earnings (loss) per share is determined by dividing net income (loss) applicable to common shareholders for the applicable year by the sum of the weighted average number of shares of beneficial interest outstanding plus the dilutive effect of the Trust's unvested restricted stock using the treasury stock method. Cash Equivalents Cash equivalents consist of highly liquid investments; primarily direct United States treasury obligations with maturities of three months or less when purchased. Restricted Cash Restricted cash consists of cash held for construction costs and property improvements at specific properties as may be required by contractual arrangements. Deferred Costs Fees and costs incurred in connection with multi-family property financings are deferred and amortized over the term of the related debt obligations. Fees and costs paid related to the successful negotiation of commercial leases are deferred and amortized on a straight-line basis over the terms of the respective leases. NOTE 1—ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES (continued) Use of Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Segment Reporting The Trust operates in two reportable segments: (i) multi-family real estate; and (ii) other real estate assets. The multi-family real estate segment includes the ownership, operation and development of the Trust's multi-family properties and the other real estate segment includes all activities related to the ownership, operation and disposition of the Trust's other real estate assets. New Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard in 2018. In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis, which amends the current consolidation guidance, including introducing a separate consolidation analysis specific to limited partnerships and other similar entities. Under this analysis, limited partnerships and other similar entities will be considered a VIE unless the limited partners hold substantive kick-out rights or participating rights. The guidance is effective for annual and interim periods beginning after December 15, 2015, with early adoption permitted. The Trust has not elected early adoption and is evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2015-03 Interest - Imputation of Interest, which amends the balance sheet presentation for debt issuance costs. Under the amended guidance, a company will present unamortized debt issuance costs as a direct deduction from the carrying amount of that debt liability. The guidance is to be applied on a retrospective basis, and is effective for annual reporting periods beginning after December 15, 2015, with early adoption being permitted. The Trust elected early adoption for the fiscal year ended September 30, 2016, and its adoption did not have a material effect on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which requires all excess tax benefits or deficiencies to be recognized as income tax expense or benefit in the income statement. In addition, excess tax benefits should be classified along with other income tax cash flows as an operating activity in the statement of cash flows. Application of the standard is required for the annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The Trust is currently evaluating the impact of this new standard on our consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force), which provides specific guidance on eight cash flow classification issues and how to reduce diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The effective date of the standard will be fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, and early adoption is permitted. The Trust is currently evaluating the new guidance to determine the impact, if any, it may have on its consolidated financial statements. |
REAL ESTATE PROPERTIES |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REAL ESTATE PROPERTIES | REAL ESTATE PROPERTIES Real estate properties (including real estate properties held for sale), consist of the following:
A summary of activity in real estate properties (including properties held for sale), for the year ended September 30, 2016, follows (dollars in thousands):
The acquisitions completed in the year ended September 30, 2016 and described in Note 3-Acquisitions, Dispositions and Impairment Charges, have been accounted for as business combinations. The purchase prices were allocated to the acquired assets and assumed liabilities based on management's estimate of fair value of these acquired assets and assumed liabilities at the dates of acquisition. The preliminary measurements of fair value reflected below are subject to change. The Trust expects to finalize the valuations and complete the purchase price allocations within one year from the date of the applicable acquisition. The following table summarizes the preliminary allocations of the purchase prices of assets acquired during the year ended September 30, 2016 (dollars in thousands):
NOTE 2—REAL ESTATE PROPERTIES (continued) The preliminary measurements of fair value reflected above are subject to change. The Trust expects to finalize the valuations and complete the purchase price allocation as soon as practicable but in no event beyond one year from the date of the applicable acquisition. The following table summarizes the preliminary allocations of the purchase price of ten properties purchased between July 1, 2015 and September 30, 2016, and the finalized allocation of the purchase price, as adjusted, as of September 30, 2016 (dollars in thousands):
A summary of the Trust's multi-family properties by state as and for the year ended September 30, 2016, is as follows (dollars in thousands):
Future minimum rentals to be received by the Trust pursuant to non-cancellable operating leases with terms in excess of one year, from a commercial property owned by the Trust at September 30, 2016, are as follows (dollars in thousands):
Leases at the Trust's multi-family properties are generally for a term of one year or less and are not reflected in the above table. ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES Property Acquisitions The table below provides information for the year ended September 30, 2016 regarding the Trust's purchases of multi-family properties (dollars in thousands):
Subsequent to September 30, 2016, the Trust purchased three multi-family properties with 933 units, including a 5.8 acre parcel of land on which it contemplates constructing 339 multi-family units. Information regarding these purchases is set forth below (dollars in thousands):
(1) Represents the purchase of a 5.8 acre parcel of land on which the Trust contemplates the construction of 339 multi-family units. NOTE 3—ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES - (continued) Property Dispositions The following table is a summary of the real estate properties disposed of by the Trust in the year ended September 30, 2016 (dollars in thousands):
(1) Reflects the sale of a partnership interest The Trust also sold two cooperative units located in Manhattan, NY for $1,377,000 and recognized a gain of $1,271,000 on the sales. The following table is a summary of the real estate properties disposed of by the Trust subsequent to the year ended September 30, 2016 (dollars in thousands):
Impairment Charges The Trust reviews each real estate asset owned, including those held through investments in unconsolidated joint ventures, for impairment when there is an event or a change in circumstances indicating that the carrying amount may not be recoverable. The Trust measures and records impairment losses, and reduces the carrying value of properties, when indicators of impairment are present and the expected undiscounted cash flows related to those properties are less than their carrying amounts. In cases where the Trust does not expect to recover its carrying costs on properties held for use, the Trust reduces its carrying costs to fair value, and for properties held for sale, the Trust reduces its carrying value to the fair value less costs to sell. During the years ended September 30, 2016, 2015, and 2014, no impairment charges were recorded. Management does not believe that the values of any properties are impaired as of September 30, 2016. REAL ESTATE PROPERTY HELD FOR SALE At September 30, 2016, the Sandtown Vistas property in Atlanta, GA and the Spring Valley property in Panama City, FL were held for sale. The Sandtown Vista property, which had a book value of $27,076,000, was sold on November 21, 2016. The Trust estimates it will recognize a gain on the sale of the property of approximately $8,800,000 of which approximately $4,000,000 will be allocated to the non-controlling partner. The Spring Valley property, which had a book value of $6,920,000, was sold on October 26, 2016. The Trust estimates it will recognize a gain on the sale of the property of $7,400,000 of which approximately $3,700,000 will be allocated to the non-controlling partner. |
ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES | REAL ESTATE PROPERTIES Real estate properties (including real estate properties held for sale), consist of the following:
A summary of activity in real estate properties (including properties held for sale), for the year ended September 30, 2016, follows (dollars in thousands):
The acquisitions completed in the year ended September 30, 2016 and described in Note 3-Acquisitions, Dispositions and Impairment Charges, have been accounted for as business combinations. The purchase prices were allocated to the acquired assets and assumed liabilities based on management's estimate of fair value of these acquired assets and assumed liabilities at the dates of acquisition. The preliminary measurements of fair value reflected below are subject to change. The Trust expects to finalize the valuations and complete the purchase price allocations within one year from the date of the applicable acquisition. The following table summarizes the preliminary allocations of the purchase prices of assets acquired during the year ended September 30, 2016 (dollars in thousands):
NOTE 2—REAL ESTATE PROPERTIES (continued) The preliminary measurements of fair value reflected above are subject to change. The Trust expects to finalize the valuations and complete the purchase price allocation as soon as practicable but in no event beyond one year from the date of the applicable acquisition. The following table summarizes the preliminary allocations of the purchase price of ten properties purchased between July 1, 2015 and September 30, 2016, and the finalized allocation of the purchase price, as adjusted, as of September 30, 2016 (dollars in thousands):
A summary of the Trust's multi-family properties by state as and for the year ended September 30, 2016, is as follows (dollars in thousands):
Future minimum rentals to be received by the Trust pursuant to non-cancellable operating leases with terms in excess of one year, from a commercial property owned by the Trust at September 30, 2016, are as follows (dollars in thousands):
Leases at the Trust's multi-family properties are generally for a term of one year or less and are not reflected in the above table. ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES Property Acquisitions The table below provides information for the year ended September 30, 2016 regarding the Trust's purchases of multi-family properties (dollars in thousands):
Subsequent to September 30, 2016, the Trust purchased three multi-family properties with 933 units, including a 5.8 acre parcel of land on which it contemplates constructing 339 multi-family units. Information regarding these purchases is set forth below (dollars in thousands):
(1) Represents the purchase of a 5.8 acre parcel of land on which the Trust contemplates the construction of 339 multi-family units. NOTE 3—ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES - (continued) Property Dispositions The following table is a summary of the real estate properties disposed of by the Trust in the year ended September 30, 2016 (dollars in thousands):
(1) Reflects the sale of a partnership interest The Trust also sold two cooperative units located in Manhattan, NY for $1,377,000 and recognized a gain of $1,271,000 on the sales. The following table is a summary of the real estate properties disposed of by the Trust subsequent to the year ended September 30, 2016 (dollars in thousands):
Impairment Charges The Trust reviews each real estate asset owned, including those held through investments in unconsolidated joint ventures, for impairment when there is an event or a change in circumstances indicating that the carrying amount may not be recoverable. The Trust measures and records impairment losses, and reduces the carrying value of properties, when indicators of impairment are present and the expected undiscounted cash flows related to those properties are less than their carrying amounts. In cases where the Trust does not expect to recover its carrying costs on properties held for use, the Trust reduces its carrying costs to fair value, and for properties held for sale, the Trust reduces its carrying value to the fair value less costs to sell. During the years ended September 30, 2016, 2015, and 2014, no impairment charges were recorded. Management does not believe that the values of any properties are impaired as of September 30, 2016. REAL ESTATE PROPERTY HELD FOR SALE At September 30, 2016, the Sandtown Vistas property in Atlanta, GA and the Spring Valley property in Panama City, FL were held for sale. The Sandtown Vista property, which had a book value of $27,076,000, was sold on November 21, 2016. The Trust estimates it will recognize a gain on the sale of the property of approximately $8,800,000 of which approximately $4,000,000 will be allocated to the non-controlling partner. The Spring Valley property, which had a book value of $6,920,000, was sold on October 26, 2016. The Trust estimates it will recognize a gain on the sale of the property of $7,400,000 of which approximately $3,700,000 will be allocated to the non-controlling partner. |
DISCONTINUED OPERATIONS |
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Discontinued Operations and Disposal Groups [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DISCONTINUED OPERATIONS | Discontinued Operations On February 23, 2016, the Trust sold, through subsidiaries which owned such interests, its equity interests in RBH - TRB Newark Holdings, LLC (the "Newark Joint Venture"), to RBH Partners III, LLC, for $16,900,000 (the "NJV Sale"). The buyer is an affiliate of the Trust's former partners in the Newark Joint Venture. The Trust recognized a gain of $15,467,000 in connection with this sale. In addition, the Trust (i) may be paid up to an additional $900,000 by the newly formed parent of the Newark Joint Venture (“Holdco”) upon the achievement of specified investment returns, development of certain properties, realization of specified cost savings and any one or more of the foregoing and (ii) has been granted a nominal profit participation interest in Holdco. None of these amounts will be recognized until received. Other than the agreement of the Trust's subsidiary to provide an indemnity with respect to up to $2,800,000 of obligations related to the venture, neither the Trust nor its subsidiaries have any guaranty, indemnity or similar obligations with respect to the Newark Joint Venture. As a result of the NJV Sale, the mortgage debt in principal amount of $19,500,000 (the “NJV Loan Receivable”) owed to the Trust by this venture (which was not included on the Trust's consolidated balance sheet at September 30, 2015 as such debt and the interest that had accrued thereon was eliminated in consolidation), is reflected as a real estate loan on the consolidated balance sheet at September 30, 2016. The NJV Loan Receivable is secured by various contiguous parcels on Market Street (between University Avenue and Washington Street) in Newark, NJ. The site is approximately 68,000 square feet and has approximately 303,000 square feet of rentable space. The NJV Loan Receivable matures in June 2017 and bears an annual interest rate of 11%. Six percent (6%) is to be paid on a monthly basis ("Current Interest") and five percent (5%) is deferred (the"Deferred Interest"). The NJV Loan Receivable provided that the Deferred Interest was to be paid in June 2016 and at maturity in June 2017. At September 30, 2016, the amount of Deferred Interest that has been recognized is $2,380,000. The Trust has agreed from time-to-time to defer the payment of the Deferred Interest, and most recently entered into an agreement dated October 31, 2016 with the Newark Joint Venture pursuant to which the Trust agreed, among other things, to defer, until December 31, 2016, the payment of the Deferred Interest; provided, however, that in the event a transaction is completed prior to January 1, 2017 that results in, among other things, (a) in the release of certain of the mortgages securing the NJV Loan Receivable and (b) the Trust’s receipt of not less (i) than $5,900,000 in principal amount of the NJV Loan Receivable and (ii) $750,000 of Deferred Interest, the payment of the remaining balance of the Deferred Interest will be deferred until June 2017. The assets and liabilities as of September 30, 2015 of the discontinued operations of the Newark Joint Venture and the statement of operations for the twelve months ended September 30, 2016 and 2015, are summarized as follows (dollars in thousands):
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REAL ESTATE PROPERTY HELD FOR SALE |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REAL ESTATE PROPERTY HELD FOR SALE | REAL ESTATE PROPERTIES Real estate properties (including real estate properties held for sale), consist of the following:
A summary of activity in real estate properties (including properties held for sale), for the year ended September 30, 2016, follows (dollars in thousands):
The acquisitions completed in the year ended September 30, 2016 and described in Note 3-Acquisitions, Dispositions and Impairment Charges, have been accounted for as business combinations. The purchase prices were allocated to the acquired assets and assumed liabilities based on management's estimate of fair value of these acquired assets and assumed liabilities at the dates of acquisition. The preliminary measurements of fair value reflected below are subject to change. The Trust expects to finalize the valuations and complete the purchase price allocations within one year from the date of the applicable acquisition. The following table summarizes the preliminary allocations of the purchase prices of assets acquired during the year ended September 30, 2016 (dollars in thousands):
NOTE 2—REAL ESTATE PROPERTIES (continued) The preliminary measurements of fair value reflected above are subject to change. The Trust expects to finalize the valuations and complete the purchase price allocation as soon as practicable but in no event beyond one year from the date of the applicable acquisition. The following table summarizes the preliminary allocations of the purchase price of ten properties purchased between July 1, 2015 and September 30, 2016, and the finalized allocation of the purchase price, as adjusted, as of September 30, 2016 (dollars in thousands):
A summary of the Trust's multi-family properties by state as and for the year ended September 30, 2016, is as follows (dollars in thousands):
Future minimum rentals to be received by the Trust pursuant to non-cancellable operating leases with terms in excess of one year, from a commercial property owned by the Trust at September 30, 2016, are as follows (dollars in thousands):
Leases at the Trust's multi-family properties are generally for a term of one year or less and are not reflected in the above table. ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES Property Acquisitions The table below provides information for the year ended September 30, 2016 regarding the Trust's purchases of multi-family properties (dollars in thousands):
Subsequent to September 30, 2016, the Trust purchased three multi-family properties with 933 units, including a 5.8 acre parcel of land on which it contemplates constructing 339 multi-family units. Information regarding these purchases is set forth below (dollars in thousands):
(1) Represents the purchase of a 5.8 acre parcel of land on which the Trust contemplates the construction of 339 multi-family units. NOTE 3—ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES - (continued) Property Dispositions The following table is a summary of the real estate properties disposed of by the Trust in the year ended September 30, 2016 (dollars in thousands):
(1) Reflects the sale of a partnership interest The Trust also sold two cooperative units located in Manhattan, NY for $1,377,000 and recognized a gain of $1,271,000 on the sales. The following table is a summary of the real estate properties disposed of by the Trust subsequent to the year ended September 30, 2016 (dollars in thousands):
Impairment Charges The Trust reviews each real estate asset owned, including those held through investments in unconsolidated joint ventures, for impairment when there is an event or a change in circumstances indicating that the carrying amount may not be recoverable. The Trust measures and records impairment losses, and reduces the carrying value of properties, when indicators of impairment are present and the expected undiscounted cash flows related to those properties are less than their carrying amounts. In cases where the Trust does not expect to recover its carrying costs on properties held for use, the Trust reduces its carrying costs to fair value, and for properties held for sale, the Trust reduces its carrying value to the fair value less costs to sell. During the years ended September 30, 2016, 2015, and 2014, no impairment charges were recorded. Management does not believe that the values of any properties are impaired as of September 30, 2016. REAL ESTATE PROPERTY HELD FOR SALE At September 30, 2016, the Sandtown Vistas property in Atlanta, GA and the Spring Valley property in Panama City, FL were held for sale. The Sandtown Vista property, which had a book value of $27,076,000, was sold on November 21, 2016. The Trust estimates it will recognize a gain on the sale of the property of approximately $8,800,000 of which approximately $4,000,000 will be allocated to the non-controlling partner. The Spring Valley property, which had a book value of $6,920,000, was sold on October 26, 2016. The Trust estimates it will recognize a gain on the sale of the property of $7,400,000 of which approximately $3,700,000 will be allocated to the non-controlling partner. |
RESTRICTED CASH |
12 Months Ended |
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Sep. 30, 2016 | |
Restricted Cash and Investments [Abstract] | |
RESTRICTED CASH | RESTRICTED CASH Restricted cash represents funds for specific purposes and therefore are not generally available for general corporate purposes. As reflected on the consolidated balance sheet, restricted cash represents funds held by or on behalf of the Trust specifically for capital improvements at multi-family properties. |
DEBT OBLIGATIONS |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEBT OBLIGATIONS | DEBT OBLIGATIONS Debt obligations consist of the following (dollars in thousands):
Mortgage Payable At September 30, 2016, $621,382,000 of mortgage debt (including $27,052,000 classified as held for sale) is outstanding on the Trust's 33 multi-family properties and one commercial property with a weighted average interest rate of 3.98% and a weighted average remaining term to maturity of seven years. Scheduled principal repayments for the next five years and thereafter are as follows (dollars in thousands):
During the twelve months ended September 30, 2016, the Trust incurred the following fixed rate mortgage debt in connection with the following acquisitions (dollars in thousands):
(1) Debt is fixed rate by use of an interest rate swap. During the twelve months ended September 30, 2016, the Trust obtained supplemental fixed rate financing as set forth in the table below (dollars in thousands):
Junior Subordinated Notes At September 30, 2016 and 2015 the Trust's junior subordinated notes had an outstanding principal balance of $37,400,000. At September 30, 2016, the interest rate on the outstanding balance is three month LIBOR +2.00% or 2.76%. The junior subordinated notes require interest only payments through the maturity date, at which time repayment of all outstanding principal and interest is due. Interest expense for each of the years ended September 30, 2016, 2015 and 2014, which includes amortization of deferred costs, was $1,510,000, $1,853,000 and $1,853,000, respectively. |
INCOME TAXES |
12 Months Ended |
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Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Trust elected to be taxed as a real estate investment trust ("REIT"),pursuant to the Code. As a REIT, the Trust will generally not be subject to Federal income taxes at the corporate level if it distributes 100% of its REIT taxable income, as defined, to its shareholders. To maintain its REIT status, the Trust must distribute at least 90% of its taxable income; however if it does not distribute 100% of its taxable income, it will be taxed on undistributed income. There are a number of organizational and operational requirements the Trust must meet to remain a REIT. If the Trust fails to qualify as a REIT in any taxable year, its taxable income will be subject to Federal income tax at regular corporate tax rates and it may not be able to qualify as a REIT for four subsequent tax years. Even if it is qualified as a REIT, the Trust is subject to certain state and local income taxes and to Federal income and excise taxes on the undistributed taxable income. For income tax purposes, the Trust reports on a calendar year. During the years ended September 30, 2016, 2015 and 2014, the Trust recorded $689,000, $18,000 and $155,000, respectively, of Federal alternative minimum tax and state franchise tax expense, net of refunds, relating to the 2016, 2015 and 2014 calendar years. Earnings and profits, which determine the taxability of dividends to shareholders, differs from net income reported for financial statement purposes due to various items, including timing differences related to loan loss provisions, impairment charges, depreciation methods and carrying values. At December 31, 2015, the Trust had a net operating loss carry forward of $69,193,000. These net operating losses may be available in future years to reduce taxable income when it is generated. These tax loss carry forwards begin to expire in 2030 |
SHAREHOLDERS' EQUITY |
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Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SHAREHOLDERS' EQUITY | SHAREHOLDERS' EQUITY Common Share Dividend Distribution During the year ended September 30, 2016, 2015 and 2014, the Trust did not declare or pay any dividends. Stock Based Compensation The Trust's Amended and Restated 2016 Incentive Plan (the "Plan") permits the Trust to grant stock options, restricted stock, restricted stock units, performance shares awards and any one or more of the foregoing, up to a maximum of 600,000 shares. The Plan also allows for the grant of cash settled dividend equivalent rights in tandem with the grant of restricted stock units and certain performance based awards. Pursuant to the Plan, during the year ended September 30, 2016, the Trust issued restricted stock units (the "Units") to acquire up to 450,000 common shares (the "Pay for Performance Program"). Subject to satisfying a continued service requirement, except in the case of death, disability, retirement or change in control, through the five years ending March 31, 2021 (the “Performance Period”), the Units entitle the recipients to acquire in the aggregate, (i) 200,000 shares (the “TSR Award”) based on achieving, during the Performance Period, certain levels in compounded annual growth rate (“CAGR”) in total shareholder return (“TSR”), and (ii) 200,000 shares based on achieving, during the Performance Period, certain levels in CAGR in adjusted funds from operations, as determined pursuant to the performance agreement (the "AFFO Award"). In addition, subject to satisfying the continued service requirement, up to 50,000 shares may be added to or subtracted from the TSR Award, based on attaining or failing to attain, during the Performance Period, of CAGR in TSR relative to the CAGR in TSR for the constituent REITs that NOTE 9—SHAREHOLDERS' EQUITY (continued) comprise, with specified exceptions, the FTSE NAREIT Equity Apartment Index. Recipients of the Units are entitled to receive cash dividends with respect to the common shares underlying the Units as if the underlying shares were outstanding during the Performance Period, if, when, and to the extent, the related Units vest and were determined not to be participating securities. Accordingly, for accounting purposes, the shares underlying the Units are excluded in the outstanding shares reflected on the consolidated balance sheet and from the calculation of basic earnings per share. The shares are contingently issuable shares but have not been included in the diluted earnings per share as the performance and market criteria have not been met. For the TSR Awards, a third party appraiser prepared a Monte Carlo simulation pricing model to assist management in determining the fair value. For the AFFO Awards, the fair value is based on the market value on the date of grant. Expense is not recognized on the Units which the Trust does not expect to vest as a result of service conditions or the Trust’s performance expectations. The total amount recorded as deferred compensation with respect to the Units is $2,117,000 and is being charged to general and administrative expense over the approximate five year vesting period. The deferred compensation expense to be recognized is net of certain forfeiture and performance assumptions. The Trust recorded $146,000 of compensation expense related to the amortization of unearned compensation with respect to the Units in the twelve months ended September 30, 2016. In January 2016, the Trust granted 141,050 shares of restricted stock pursuant to the 2012 Incentive Plan (the "2012 Plan"). No additional awards may be granted under the Prior Plans. All restricted shares vest five years from the date of grant and under specified circumstances, including a change in control, may vest earlier. For accounting purposes, the restricted shares are not included in the outstanding shares shown on the consolidated balance sheets until they vest, but are included in the earnings per share computation. During the years ended September 30, 2016, 2015 and 2014, the Trust recorded $859,000 and $906,000, and $805,000 respectively, of compensation expense related to the amortization of unearned compensation with respect to the restricted share awards. At September 30, 2016 and September 30, 2015, $2,089,000 and $2,184,000 has been deferred as unearned compensation and will be charged to expense over the remaining vesting periods of these restricted share awards. The weighted average vesting period of these restricted shares is 2.3 years. NOTE 9—SHAREHOLDERS' EQUITY (continued) Changes in number of restricted shares outstanding under the Trust's equity incentive plans are shown below:
The following table reflects the compensation expense recorded for all incentive plans (dollars in thousands):
Earnings (Loss) Per Share The following table sets forth the computation of basic and diluted earnings (loss) per share (dollars in thousands):
Share Buyback In February 2016, pursuant to a share purchase program then in effect, the Trust purchased 252,000 shares of beneficial interest at the market price of $6.29 for a purchase price, including commission, of $1,584,000. On March 11, 2016, the Board of Trustees, approved a new share repurchase program authorizing the Trust to repurchase up to $5,000,000 of shares of beneficial interest through September 30, 2017. Pursuant to this authorization the Trust, from such date through September 30, 2016, repurchased 74,421 shares of beneficial interest at an average market price of $7.13, for a purchase price, including commissions, of $530,000. |
RELATED PARTY TRANSACTIONS |
12 Months Ended |
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Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The Trust paid REIT Management, a related party, advisory fees pursuant to its Advisory Agreement of $693,000 $2,448,000 and $2,016,000 for the years ended September 30, 2016, 2015 and 2014, respectively. The Advisory Agreement terminated effective December 31, 2015. Effective as of January 1, 2016, the Trust retained certain of its executive officers and its former chairman of the board to provide services previously provided pursuant to such agreement. The aggregate fees paid in 2016 fiscal year for these services were $863,000. Management of certain properties owned by the Trust and certain joint venture properties is provided by Majestic Property Management Corp., a corporation in which Fredric H. Gould is the sole shareholder, under renewable year-to-year agreements. Certain of the Trust's officers and Trustees are also officers and directors of Majestic Property Management Corp. Majestic Property Management Corp. provides real property management, real estate brokerage and construction supervision services to these properties. For the years ended September 30, 2016, 2015 and 2014, fees for these services were $34,000, $56,000, and $28,000, respectively. Fredric H. Gould is the vice chairman of the board of directors of One Liberty Properties, Inc., a related party, and certain of the Trust's officers and Trustees are also officers and, or directors of One Liberty Properties, Inc. In addition, Mr. Gould is an executive officer and sole shareholder of Georgetown Partners, Inc., the managing general partner of Gould Investors L.P., a related party. Certain of the Trust's officers and Trustees are also officers and/or directors of Georgetown Partners, Inc. The allocation of expenses for the shared facilities, personnel and other resources is computed in accordance with a shared services agreement by and among the Trust and the affiliated entities and is included in general and administrative expense on the statements of operations. During the years ended September 30, 2016, 2015 and 2014, allocated general and administrative expenses reimbursed by the Trust to Gould Investors L.P. pursuant to the shared services agreement aggregated $549,000, $532,000 and $474,000, respectively. On December 11, 2015, the Trust borrowed $8,000,000 from Gould Investors L.P. at an interest rate of 5.24%. This loan was satisfied on February 24, 2016. Interest expense for the year ended September 30, 2016 was $86,000. Management of many of the Trust's properties is performed by its partners or their affiliates. In addition, the Trust may pay an acquisition fee to its partner upon the purchase of a property. These management and acquisition fees amounted to $4,140,000, $2,678,000 and $2,797,000 for the years ended September 30, 2016, 2015 and 2014, respectively. In addition to its share of rent included as part of the Shared Services Agreement, the Trust leased additional space in the same building directly from an affiliate of Gould Investors L.P. prior to the sale of the building in January 2015. The rent paid was $64,000 and $149,000 in the years ended September 30, 2015 and 2014, respectively. The Trust obtains insurance (primarily property insurance) in conjunction with Gould Investors L.P. and reimburses Gould for the Trust's share of the insurance cost. Insurance reimbursements to Gould Investors L.P. for the years ended September 30, 2016, 2015 and 2014 were $41,000, $15,000 and $15,000 respectively. See Note 4 - Discontinued Operations for information regarding the Trust's sale of its interest in the Newark Joint Venture. |
SEGMENT REPORTING |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT REPORTING | SEGMENT REPORTING Management has determined that the Trust operates in two reportable segments: a multi-family real estate segment which includes the ownership, operation and development of its multi-family properties, and another real estate segment, which includes the ownership and operation and development of its other real estate assets. The following table summarizes the Trust's segment reporting for the year ended September 30, 2016 (dollars in thousands):
NOTE 11—SEGMENT REPORTING - (continued) The following table summarizes the Trust's segment reporting for the year ended September 30, 2015 (dollars in thousands):
NOTE 11—SEGMENT REPORTING - (continued) The following table summarizes the Trust's segment reporting for the year ended September 30, 2014 (dollars in thousands):
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FAIR VALUE OF FINANCIAL INSTRUMENTS |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS Financial Instruments Not Measured at Fair Value The following methods and assumptions were used to estimate the fair value of each class of financial instruments that are not reported at fair value on the consolidated balance sheets: Cash and cash equivalents, restricted cash, accounts receivable (included in other assets), accounts payable and accrued liabilities: The carrying amounts reported in the balance sheets for these instruments approximate their fair value due to the short term nature of these accounts. Junior subordinated notes: At September 30, 2016 and 2015, the estimated fair value of the Trust's junior subordinated notes is less than their carrying value by approximately $16,549,000, and $20,174,000, respectively based on market interest rates of 6.35% and 6.38%, respectively. Mortgages payable: At September 30, 2016, the estimated fair value of the Trust's mortgages payable is greater than their carrying value by approximately $10,629,000 assuming market interest rates between 3.05% and 4.25%. At September 30, 2015, the estimated fair value was lower than the carrying value by $890,000, assuming market interest rates between 1.99% and 15.00%. Market interest rates were determined using current financing transaction information provided by third party institutions. Considerable judgment is necessary to interpret market data and develop estimated fair value. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value assumptions. The fair values of the real estate loans and debt obligations are considered to be Level 2 valuations within the fair value hierarchy. Financial Instruments Measured at Fair Value The Trust's fair value measurements are based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, there is a fair value hierarchy that distinguishes between markets participant assumptions based on market data obtained from sources independent of the reporting entity and the reporting entity's own assumptions about market participant assumptions. Level 1 assets/liabilities are valued based on quoted prices for identical instruments in active markets, Level 2 assets/liabilities are valued based on quoted prices in active markets for similar instruments, on quoted prices in less active or inactive markets, or on other "observable" market inputs and Level 3 assets/liabilities are valued based significantly on "unobservable" market inputs. The Trust does not currently own any financial instruments that are classified as Level 3. Set forth below is information regarding the Trust's financial assets and liabilities measured at fair value as of September 30, 2016 (dollars in thousands):
Derivative financial instruments: Fair values are approximated using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivatives. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves, and implied volatilities. At September 30, 2016, these derivatives are included in accounts payable and accrued liabilities on the consolidated balance sheet. Although the Trust has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with it utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparty. As of September 30, 2016, the Trust assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. As a result, the Trust determined that its derivative valuation is classified in Level 2 of the fair value hierarchy. |
COMMITMENT |
12 Months Ended |
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Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENT | COMMITMENT The Trust maintains a non-contributory defined contribution pension plan covering eligible employees and officers. Contributions by the Trust are made through a money purchase plan, based upon a percent of qualified employees' total salary as defined therein. Pension expense approximated $324,000, $322,000 and $322,000 during the years ended September 30, 2016, 2015 and 2014, respectively. At September 30, 2016 and 2015, $47,000 and $50,000, respectively, remains unpaid and is included in accounts payable and accrued liabilities on the consolidated balance sheets. |
DERIVATIVE FINANCIAL INSTRUMENTS |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVE FINANCIAL INSTRUMENTS | DERIVATIVE FINANCIAL INSTRUMENTS Cash Flow Hedges of Interest Rate Risk The Trust's objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Trust primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Trust making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The effective portion of changes in the fair value of derivatives, designated and that qualify as cash flow hedges, is recorded in accumulated other comprehensive income (loss) on our consolidated balance sheets and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Amounts reported in accumulated other comprehensive income (loss) related to derivatives will be reclassified to interest expense as interest payments are made on the Trust's variable-rate debt. As of September 30, 2016, the Trust had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollars in thousands):
The following table presents the effect of the Trust's derivative financial instrument on the consolidated statements of comprehensive income (loss) for the years ended September 30, 2016, 2015 and 2014 (dollars in thousands):
NOTE 14—DERIVATIVE FINANCIAL INSTRUMENTS - (continued) No gain or loss was recognized related to hedge ineffectiveness or to amounts excluded from effectiveness testing on the Trust's cash flow hedges during the years ended September 30, 2016, 2015 or 2014. During the twelve months ending September 30, 2017, the Trust estimates an additional $502,000 will be reclassified from other comprehensive income as an increase to interest expense. Credit-risk-related Contingent Features The agreement between the Trust and its derivatives counterparty provides that if the Trust defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, the Trust could be declared in default on its derivative obligation. As of September 30, 2016, the fair value of the derivative in a net liability position, which includes accrued interest, but excludes any adjustment for nonperformance risk related to this agreement, was $1,732,000. As of September 30, 2016, the Trust has not posted any collateral related to this agreement. If the Trust had been in breach of this agreement at September 30, 2016, it could have been required to settle its obligations thereunder at its termination value of $1,732,000. |
QUARTERLY FINANCIAL DATA (Unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
QUARTERLY FINANCIAL DATA (Unaudited) | QUARTERLY FINANCIAL DATA (Unaudited)
NOTE 15—QUARTERLY FINANCIAL DATA (Unaudited) - (continued)
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SUBSEQUENT EVENTS |
12 Months Ended |
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Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Subsequent events have been evaluated and any significant events, relative to our consolidated financial statements as of September 30, 2016 that warrant additional disclosure have been included in the notes to the consolidated financial statements. |
SCHEDULE III - REAL ESTATE PROPERTIES AND ACCUMULATED DEPRECIATION |
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SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SCHEDULE III - REAL ESTATE PROPERTIES AND ACCUMULATED DEPRECIATION |
Notes to the schedule:
A reconciliation of real estate properties is as follows:
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ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES (Policies) |
12 Months Ended |
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Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation - general | The consolidated financial statements include the accounts and operations of BRT Realty Trust, its wholly owned subsidiaries, and its majority owned or controlled real estate entities and its interests in variable interest entities in which the Trust is determined to be the primary beneficiary. Material intercompany balances and transactions have been eliminated. |
Principles of Consolidation - VIE's | The Trust's consolidated joint ventures that own multi-family properties were determined to be VIE's because the voting rights of some equity investors are not proportional to their obligations to absorb the expected losses of the entity and their right to receive the expected residual returns. It was determined that the Trust is the primary beneficiary of these joint ventures because it has a controlling financial interest in that it has the power to direct the activities of the VIE that most significantly impact the entity's economic performance and it has the obligation to absorb losses of the entity and the right to receive benefits from the entity that could potentially be significant to the VIE. The joint venture that owns a property in Dallas, TX was determined not to be a VIE but is consolidated because the Trust has substantive participating rights in the entity. With respect to its unconsolidated joint ventures, as (i) the Trust is primarily the managing member but does not exercise substantial operating control over these entities or the Trust is not the managing member and (ii) such entities are not VIEs, the Trust has determined that such joint ventures should be accounted for under the equity method of accounting for financial statement purposes. |
Principles of Consolidation - reclassified items | Certain items on the consolidated financial statements for the prior years have been reclassified to conform with the current year's presentation, including the reclassification of the operations and related assets of the Newark Joint Venture to discontinued operations and the reclassification of deferred loan costs on the consolidated balance sheets from assets to a reduction of the carrying amount of mortgage payable. |
Income Tax Status | Income Tax Status The Trust qualifies as a real estate investment trust under sections 856-860 of the Internal Revenue Code of 1986, as amended. The Trustees may, at their option, elect to operate the Trust as a business trust not qualifying as a real estate investment trust. The Trust will not be subject to federal, and generally state and local taxes on amounts it distributes to shareholders, provided it distributes 90% of its taxable income and meets other conditions. The Trust currently has net operating loss carryforwards which it can use to reduce taxable income. Use of the net operating loss carryforward is subject to an alternative minimum tax. NOTE 1—ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES (continued) In accordance with Accounting Standards Codification ("ASC") Topic 740 - "Income Taxes", the Trust believes that it has appropriate support for the income tax positions taken and, as such, does not have any uncertain tax positions that, if successfully challenged, could result in a material impact on the Trust's financial position or results of operations. The Trust's income tax returns for the previous six years are subject to review by the Internal Revenue Service. |
Revenue Recognition | Revenue Recognition Rental revenue from multi-family properties is recorded when due from residents and is recognized monthly as it is earned. Rental payments are due in advance. Leases on residential properties are generally for terms that do not exceed one year. Rental revenue from commercial properties, including the base rent that each tenant is required to pay in accordance with the terms of their respective leases, net of any rent concessions and lease incentives, is reported on a straight-line basis over the non-cancellable term of the lease. |
Real Estate Properties | Real Estate Properties Real estate properties are stated at cost, net of accumulated depreciation, and include real property acquired through acquisition, development or foreclosure. The Trust assesses the fair value of real estate acquired (including land, buildings and improvements, and identified intangibles such as above and below market leases and acquired in-place leases, if any) and acquired liabilities and allocates the acquisition price based on these assessments. Depreciation for multi-family properties is computed on a straight-line basis over an estimated useful life of 30 years. Intangible assets (and liabilities) are amortized over the remaining life of the related leases at the time of acquisition and is usually less than one year. . Expenditures for maintenance and repairs are charged to operations as incurred. Real estate is classified as held for sale when management has determined that it has met the applicable criteria. Real estate assets that are expected to be disposed of are valued at the lower of their carrying amount or their fair value less costs to sell on an individual asset basis. Real estate classified as held for sale is not depreciated. The Trust accounts for the sale of real estate when title passes to the buyer, sufficient equity payments have been received, there is no continuing involvement by the Trust and there is reasonable assurance that the remaining receivable, if any, will be collected. |
Real Estate Asset Impairments | Real Estate Asset Impairments The Trust reviews each real estate asset owned, including investments in real estate ventures, to determine if there are indicators of impairment. If such indicators are present, the Trust determines whether the carrying amount of the asset can be recovered. Recognition of impairment is required if the undiscounted cash flows estimated to be generated by the asset are less than the asset's carrying amount and that carrying amount exceeds the estimated fair value of the asset. In evaluating a property for impairment, various factors are considered, including estimated current and expected operating cash flow from the property during the projected holding period, costs necessary to extend the life or improve the asset, expected capitalization rates, projected stabilized net operating income, selling costs, and the ability to hold and dispose of such real estate in the ordinary course of business. Valuation adjustments may be necessary in the event that effective interest rates, rent-up periods, future economic conditions, and other relevant factors vary significantly from those assumed in valuing the property. If future evaluations result in a decrease in the value of the property below its carrying value, the reduction will be recognized as an impairment charge. The fair values related to the impaired real estate assets are considered to be a level 3 valuation within the fair value hierarchy. |
Fixed Asset Capitalization | Fixed Asset Capitalization A variety of costs may be incurred in the development of the Trust's properties. After a determination is made to capitalize a cost, it is allocated to the specific project that is benefited. The costs of land and building under development include specifically identifiable costs. The capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, and other costs incurred during the period of development. A construction project is considered substantially completed when it is available for occupancy, but no later than NOTE 1—ORGANIZATION, BACKGROUND AND SIGNIFICANT ACCOUNTING POLICIES (continued) one year from cessation of major construction activity. The Trust ceases capitalization when the project is available for occupancy. |
Equity Based Compensation | Equity Based Compensation Compensation expense for grants of restricted stock and restricted stock units ("RSUs") are amortized over the vesting period of such awards, based upon the estimated fair value of such award at the grant date. The deferred compensation related to the RSUs to be recognized as expense is net of certain and performance assumptions which are re-evaluated quarterly. For accounting purposes, the restricted shares are not included in the outstanding shares shown on the consolidated balance sheets until they vest; however, they are included in the calculation of both basic and diluted earnings per share as they participate in the earnings of the Trust. |
Derivatives and Hedging Activities | Derivatives and Hedging Activities The Trust's objective in using derivative financial instruments is to manage interest rate risk related to variable rate debt. The Trust does not use derivatives for trading or speculative purposes. The Trust records all derivatives on its consolidated balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Trust has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows are considered cash flow hedges. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in accumulated other comprehensive income (loss) and subsequently reclassified to earnings in the period in which the hedge transaction affects earnings. The ineffective portion of changes in the fair value of the derivative is recognized directly in earnings. For derivatives not designated as cash flow hedges, changes in the fair value of the derivative are recognized directly in earnings in the period in which they occur. |
Per Share Data | Per Share Data Basic earnings (loss) per share is determined by dividing net income (loss) applicable to common shareholders for the applicable year by the weighted average number of shares of beneficial interest outstanding during such year. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue shares of beneficial interest were exercised or converted into shares of beneficial interest or resulted in the issuance of shares of beneficial interest that share in the earnings of the Trust. Diluted earnings (loss) per share is determined by dividing net income (loss) applicable to common shareholders for the applicable year by the sum of the weighted average number of shares of beneficial interest outstanding plus the dilutive effect of the Trust's unvested restricted stock using the treasury stock method. |
Cash Equivalents | Cash Equivalents Cash equivalents consist of highly liquid investments; primarily direct United States treasury obligations with maturities of three months or less when purchased. |
Restricted Cash | Restricted Cash Restricted cash consists of cash held for construction costs and property improvements at specific properties as may be required by contractual arrangements. |
Deferred Costs | Deferred Costs Fees and costs incurred in connection with multi-family property financings are deferred and amortized over the term of the related debt obligations. Fees and costs paid related to the successful negotiation of commercial leases are deferred and amortized on a straight-line basis over the terms of the respective leases. |
Use of Estimates | Use of Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. |
Segment Reporting | Segment Reporting The Trust operates in two reportable segments: (i) multi-family real estate; and (ii) other real estate assets. The multi-family real estate segment includes the ownership, operation and development of the Trust's multi-family properties and the other real estate segment includes all activities related to the ownership, operation and disposition of the Trust's other real estate assets. |
New Pronouncements | New Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard in 2018. In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis, which amends the current consolidation guidance, including introducing a separate consolidation analysis specific to limited partnerships and other similar entities. Under this analysis, limited partnerships and other similar entities will be considered a VIE unless the limited partners hold substantive kick-out rights or participating rights. The guidance is effective for annual and interim periods beginning after December 15, 2015, with early adoption permitted. The Trust has not elected early adoption and is evaluating the new guidance to determine the impact it may have on its consolidated financial statements. In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2015-03 Interest - Imputation of Interest, which amends the balance sheet presentation for debt issuance costs. Under the amended guidance, a company will present unamortized debt issuance costs as a direct deduction from the carrying amount of that debt liability. The guidance is to be applied on a retrospective basis, and is effective for annual reporting periods beginning after December 15, 2015, with early adoption being permitted. The Trust elected early adoption for the fiscal year ended September 30, 2016, and its adoption did not have a material effect on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which requires all excess tax benefits or deficiencies to be recognized as income tax expense or benefit in the income statement. In addition, excess tax benefits should be classified along with other income tax cash flows as an operating activity in the statement of cash flows. Application of the standard is required for the annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The Trust is currently evaluating the impact of this new standard on our consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force), which provides specific guidance on eight cash flow classification issues and how to reduce diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The effective date of the standard will be fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, and early adoption is permitted. The Trust is currently evaluating the new guidance to determine the impact, if any, it may have on its consolidated financial statements. |
REAL ESTATE PROPERTIES (Tables) |
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Sep. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Real Estate Properties | Real estate properties (including real estate properties held for sale), consist of the following:
A summary of activity in real estate properties (including properties held for sale), for the year ended September 30, 2016, follows (dollars in thousands):
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Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | A summary of the Trust's multi-family properties by state as and for the year ended September 30, 2016, is as follows (dollars in thousands):
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Schedule of Operating Leases, Future Minimum Payments, Receivable | Future minimum rentals to be received by the Trust pursuant to non-cancellable operating leases with terms in excess of one year, from a commercial property owned by the Trust at September 30, 2016, are as follows (dollars in thousands):
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2016 real estate property acquisitions | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary allocations of the purchase prices of assets acquired during the year ended September 30, 2016 (dollars in thousands):
NOTE 2—REAL ESTATE PROPERTIES (continued) The preliminary measurements of fair value reflected above are subject to change. The Trust expects to finalize the valuations and complete the purchase price allocation as soon as practicable but in no event beyond one year from the date of the applicable acquisition. |
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July 1, 2015 through September 30, 2016 real estate property acquisitions | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary allocations of the purchase price of ten properties purchased between July 1, 2015 and September 30, 2016, and the finalized allocation of the purchase price, as adjusted, as of September 30, 2016 (dollars in thousands):
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ACQUISITIONS, DISPOSITIONS AND IMPAIRMENT CHARGES (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Real Estate Acquisitions | Information regarding these purchases is set forth below (dollars in thousands):
(1) Represents the purchase of a 5.8 acre parcel of land on which the Trust contemplates the construction of 339 multi-family units. The table below provides information for the year ended September 30, 2016 regarding the Trust's purchases of multi-family properties (dollars in thousands):
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Schedule of Real Estate Disposals | The following table is a summary of the real estate properties disposed of by the Trust subsequent to the year ended September 30, 2016 (dollars in thousands):
The following table is a summary of the real estate properties disposed of by the Trust in the year ended September 30, 2016 (dollars in thousands):
(1) Reflects the sale of a partnership interest The assets and liabilities as of September 30, 2015 of the discontinued operations of the Newark Joint Venture and the statement of operations for the twelve months ended September 30, 2016 and 2015, are summarized as follows (dollars in thousands):
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DISCONTINUED OPERATIONS (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Real Estate Disposals | The following table is a summary of the real estate properties disposed of by the Trust subsequent to the year ended September 30, 2016 (dollars in thousands):
The following table is a summary of the real estate properties disposed of by the Trust in the year ended September 30, 2016 (dollars in thousands):
(1) Reflects the sale of a partnership interest The assets and liabilities as of September 30, 2015 of the discontinued operations of the Newark Joint Venture and the statement of operations for the twelve months ended September 30, 2016 and 2015, are summarized as follows (dollars in thousands):
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DEBT OBLIGATIONS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Obligations | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt Obligations | Debt obligations consist of the following (dollars in thousands):
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Schedule of Maturities of Long-term Debt | Scheduled principal repayments for the next five years and thereafter are as follows (dollars in thousands):
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Schedule of Outstanding Debt | During the twelve months ended September 30, 2016, the Trust obtained supplemental fixed rate financing as set forth in the table below (dollars in thousands):
During the twelve months ended September 30, 2016, the Trust incurred the following fixed rate mortgage debt in connection with the following acquisitions (dollars in thousands):
(1) Debt is fixed rate by use of an interest rate swap. |
SHAREHOLDERS' EQUITY (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in number of shares outstanding under equity incentive plans | Changes in number of restricted shares outstanding under the Trust's equity incentive plans are shown below:
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Schedule of compensation expense recorded for all incentive plans | The following table reflects the compensation expense recorded for all incentive plans (dollars in thousands):
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Schedule of computation of basic and diluted earnings per share | The following table sets forth the computation of basic and diluted earnings (loss) per share (dollars in thousands):
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SEGMENT REPORTING (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of segment reporting | The following table summarizes the Trust's segment reporting for the year ended September 30, 2016 (dollars in thousands):
NOTE 11—SEGMENT REPORTING - (continued) The following table summarizes the Trust's segment reporting for the year ended September 30, 2015 (dollars in thousands):
NOTE 11—SEGMENT REPORTING - (continued) The following table summarizes the Trust's segment reporting for the year ended September 30, 2014 (dollars in thousands):
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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of financial assets and liabilities measured at fair value | Set forth below is information regarding the Trust's financial assets and liabilities measured at fair value as of September 30, 2016 (dollars in thousands):
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DERIVATIVE FINANCIAL INSTRUMENTS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Rate Derivatives | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of fair value of derivative financial instruments and classification on consolidated balance sheets |
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Schedule of effect of derivative financial instrument on consolidated statements of comprehensive income | The following table presents the effect of the Trust's derivative financial instrument on the consolidated statements of comprehensive income (loss) for the years ended September 30, 2016, 2015 and 2014 (dollars in thousands):
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Designated as a hedge | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Rate Derivatives | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of interest rate derivative | As of September 30, 2016, the Trust had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollars in thousands):
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QUARTERLY FINANCIAL DATA (Unaudited) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of quarterly financial data |
NOTE 15—QUARTERLY FINANCIAL DATA (Unaudited) - (continued)
|
REAL ESTATE PROPERTIES (Details) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Sep. 30, 2015 |
---|---|---|
Real Estate [Abstract] | ||
Land | $ 128,409 | |
Building | 684,133 | |
Building improvements | 25,717 | |
Real estate properties | 838,259 | |
Accumulated depreciation | (44,687) | |
Total real estate properties, net | $ 793,572 | $ 615,586 |
REAL ESTATE PROPERTIES (Details 4) $ in Thousands |
12 Months Ended |
---|---|
Sep. 30, 2016
USD ($)
| |
Commercial | |
Future minimum rentals to be received pursuant to non-cancellable operating leases | |
2017 | $ 1,103 |
2018 | 1,120 |
2019 | 1,120 |
2020 | 1,120 |
2021 | 1,129 |
Thereafter | 5,685 |
Total | $ 11,277 |
Maximum | Multi-family residential | |
Real Estate Properties | |
Operating leases, term of contract | 1 year |
DISCONTINUED OPERATIONS - Balance Sheet (Details) - USD ($) $ in Thousands |
Sep. 30, 2016 |
Sep. 30, 2015 |
---|---|---|
ASSETS | ||
Total assets of discontinued operations | $ 0 | $ 163,545 |
LIABILITIES | ||
Deferred costs | 9,683 | |
Total liabilities of discontinued operations | $ 0 | 138,530 |
Newark Joint Venture | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||
ASSETS | ||
Real estate properties, net | 141,441 | |
Restricted cash | 13,277 | |
Deposits and escrows | 93 | |
Other assets | 8,734 | |
Total assets of discontinued operations | 163,545 | |
LIABILITIES | ||
Mortgage payable, net of deferred costs of $9,683 | 100,692 | |
Accounts payable and accrued liabilities | 6,848 | |
Deferred income | 30,990 | |
Total liabilities of discontinued operations | $ 138,530 |
DISCONTINUED OPERATIONS - Statement of Operations (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Feb. 23, 2016 |
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Expenses: | ||||
Gain on sale of partnership interest | $ 15,467 | $ 0 | $ 0 | |
Newark Joint Venture | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Revenues: | ||||
Rental and other revenue from real estate properties | 2,437 | 4,335 | ||
Other income | 444 | 1,067 | ||
Total revenues | 2,881 | 5,402 | ||
Expenses: | ||||
Real estate operating expenses | 2,277 | 4,610 | ||
Interest expense | 2,242 | 4,880 | ||
Depreciation | 1,150 | 2,241 | ||
Total expense | 5,669 | 11,731 | ||
Income from discontinued operations | (2,788) | (6,329) | ||
Gain on sale of partnership interest | $ 15,467 | 15,467 | 0 | |
Discontinued operations | $ 12,679 | $ (6,329) |
REAL ESTATE PROPERTY HELD FOR SALE (Details) - USD ($) $ in Thousands |
2 Months Ended | |||
---|---|---|---|---|
Nov. 21, 2016 |
Oct. 26, 2016 |
Dec. 09, 2016 |
Sep. 30, 2016 |
|
Atlanta, GA | ||||
Real Estate [Line Items] | ||||
Real estate held-for-sale | $ 27,076 | |||
Panama City, FL (Location 1) | ||||
Real Estate [Line Items] | ||||
Real estate held-for-sale | $ 6,920 | |||
Subsequent Event | ||||
Real Estate [Line Items] | ||||
Sales of real estate | $ 27,076 | $ 6,920 | ||
Subsequent Event | Atlanta, GA | ||||
Real Estate [Line Items] | ||||
Estimated proceeds from sale of property held-for-sale, portion allocated to minority partners | $ 4,000 | |||
Estimated gains (losses) on sales of real estate held for sale | 8,800 | |||
Subsequent Event | Panama City, FL (Location 1) | ||||
Real Estate [Line Items] | ||||
Estimated proceeds from sale of property held-for-sale, portion allocated to minority partners | 3,700 | |||
Estimated gains (losses) on sales of real estate held for sale | $ 7,400 |
DEBT OBLIGATIONS - Junior Subordinated Notes (Details) - Junior subordinated notes - USD ($) |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Debt Obligations | |||
Outstanding principal balance | $ 37,400,000 | $ 37,400,000 | |
Interest expense | $ 1,510,000 | $ 1,853,000 | $ 1,853,000 |
April 30, 2016 through April 30, 2036 | LIBOR | |||
Debt Obligations | |||
Interest rate (as a percent) | 2.76% | ||
Margin interest above reference rate (as a percent) | 2.00% |
INCOME TAXES (Detail) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
Dec. 31, 2015 |
|
Income Tax Disclosure [Abstract] | ||||
State franchise tax expense, net of refunds | $ 689 | $ 18 | $ 155 | |
Tax loss carry forward | $ 69,193 |
SHAREHOLDERS' EQUITY (Details 2) - Restricted stock - shares |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Changes in number of shares outstanding | |||
Outstanding at beginning of the year (in shares) | 672,875 | 648,225 | 627,425 |
Issued (in shares) | 141,050 | 142,950 | 140,600 |
Cancelled (in shares) | (16,850) | 0 | (300) |
Vested (in shares) | (130,300) | (118,300) | (119,500) |
Outstanding at the end of the year (in shares) | 666,775 | 672,875 | 648,225 |
SHAREHOLDERS' EQUITY (Details 3) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Equity incentive plans | |||
Compensation expense | $ 1,005 | $ 906 | $ 805 |
Restricted stock | |||
Equity incentive plans | |||
Compensation expense | 859 | 906 | 805 |
Restricted Stock Units (RSUs) | |||
Equity incentive plans | |||
Compensation expense | $ 146 | $ 0 | $ 0 |
SHAREHOLDERS' EQUITY (Details 4) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Numerator for basic and diluted earnings per share attributable to common shareholders: | |||
Net income (loss) attributable to common shareholders | $ 31,289 | $ (2,388) | $ (9,454) |
Denominator: | |||
Denominator for basic earnings per share-weighted average shares | 14,017,279 | 14,133,352 | 14,265,589 |
Denominator for diluted earnings per share-adjusted weighted average shares and assumed conversions | 14,017,279 | 14,133,352 | 14,265,589 |
Basic earnings (loss) per share (in dollars per share) | $ 2.23 | $ (0.17) | $ (0.66) |
Diluted earnings (loss) per share (in dollars per share) | $ 2.23 | $ (0.17) | $ (0.66) |
SHAREHOLDERS' EQUITY (Details 5) - USD ($) |
1 Months Ended | 7 Months Ended | |
---|---|---|---|
Feb. 29, 2016 |
Sep. 30, 2016 |
Mar. 11, 2016 |
|
Treasury Stock, Number of Shares and Restriction Disclosures [Abstract] | |||
Treasury stock, shares acquired (in shares) | 252,000 | 74,421 | |
Treasury stock acquired, average cost per share (in dollars per share) | $ 6.29 | $ 7.13 | |
Treasury stock, value acquired, cost method | $ 1,584,000 | $ 530,000 | |
New Share Repurchase Program [Member] | |||
Treasury Stock, Number of Shares and Restriction Disclosures [Abstract] | |||
Authorized amount under the share repurchase program | $ 5,000,000 |
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - Level 2 - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
|
Market valuation | Junior subordinated notes | ||
Financial Instruments Not Measured at Fair Value | ||
Market interest rate (as a percent) | 6.35% | 6.38% |
Market valuation | Mortgages | Minimum | ||
Financial Instruments Not Measured at Fair Value | ||
Market interest rate (as a percent) | 3.05% | 1.99% |
Market valuation | Mortgages | Maximum | ||
Financial Instruments Not Measured at Fair Value | ||
Market interest rate (as a percent) | 4.25% | 15.00% |
Estimated fair value | Junior subordinated notes | ||
Financial Instruments Not Measured at Fair Value | ||
Estimated fair value lower than carrying value | $ 16,549 | $ 20,174 |
Estimated fair value | Mortgages | ||
Financial Instruments Not Measured at Fair Value | ||
Estimated fair value lower than carrying value | $ 10,629 | $ 890 |
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details 2) - Measured at fair value on a recurring basis - Interest Rate Swap $ in Thousands |
Sep. 30, 2016
USD ($)
|
---|---|
Financial Instruments Measured at Fair Value: Available-for-sale securities - (Corporate equity securities) | |
Derivative financial instruments | $ (1,602) |
Estimated fair value | Level 2 | |
Financial Instruments Measured at Fair Value: Available-for-sale securities - (Corporate equity securities) | |
Derivative financial instruments | $ (1,602) |
COMMITMENT (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Non-contributory defined contribution pension plan | |||
Pension expense | $ 324 | $ 322 | $ 322 |
Unpaid pension expense, included in accounts payable and accrued liabilities | $ 47 | $ 50 |
QUARTERLY FINANCIAL DATA (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2014 |
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
QUARTERLY FINANCIAL DATA (Unaudited) | |||||||||||
Revenues | $ 24,757 | $ 23,245 | $ 24,857 | $ 21,405 | $ 19,656 | $ 19,790 | $ 19,123 | $ 18,526 | $ 94,264 | $ 77,095 | $ 61,813 |
Expenses | 28,455 | 26,610 | 25,849 | 23,187 | 24,622 | 21,596 | 20,838 | 20,320 | 104,101 | 87,376 | 74,030 |
Total revenues less total expenses | (3,698) | (3,365) | (992) | (1,782) | (4,966) | (1,806) | (1,715) | (1,794) | (9,837) | (10,281) | (12,217) |
Gain on sale of real estate | 11,379 | 10,263 | 24,226 | 609 | 12,228 | 0 | 2,777 | 0 | 46,477 | 15,005 | 0 |
Gain on sale of partnership interest | 0 | 386 | 0 | 0 | 386 | 0 | 0 | ||||
Loss on extinguishment of debt | (1,879) | 0 | (2,668) | 0 | (4,547) | 0 | 0 | ||||
Income (loss) from continuing operations | 5,802 | 7,284 | 20,566 | (1,173) | 7,262 | (1,806) | 1,062 | (1,794) | 32,479 | 4,724 | (12,217) |
(Loss) income from discontinued operations | 0 | 0 | 14,279 | (1,600) | (1,446) | (1,702) | (1,448) | (1,733) | 12,679 | (6,329) | (3,949) |
Net income (loss) | 5,802 | 7,284 | 34,845 | (2,773) | 5,816 | (3,508) | (386) | (3,527) | 45,158 | (1,605) | (16,166) |
(Income) loss attributable to non-controlling interests | (2,895) | (1,804) | (9,909) | 739 | (2,380) | 930 | (362) | 1,029 | (13,869) | (783) | 6,712 |
Net income (loss) attributable to common shareholders | $ 2,907 | $ 5,480 | $ 24,936 | $ (2,034) | $ 3,436 | $ (2,578) | $ (748) | $ (2,498) | $ 31,289 | $ (2,388) | $ (9,454) |
Basic and per share amounts attributable to common shareholders | |||||||||||
Continuing operations (in dollars per share) | $ 0.21 | $ 0.39 | $ 0.70 | $ (0.10) | $ 0.27 | $ (0.13) | $ (0.01) | $ (0.15) | $ 1.21 | $ (0.02) | |
Discontinued operations (in dollars per share) | 0.00 | 0.00 | 1.06 | (0.04) | (0.03) | (0.05) | (0.04) | (0.03) | 1.02 | (0.15) | |
Basic and diluted earnings (loss) per share (in dollars per share) | $ 0.21 | $ 0.39 | $ 1.76 | $ (0.14) | $ 0.24 | $ (0.18) | $ (0.05) | $ (0.18) | $ 2.23 | $ (0.17) | $ (0.66) |
SCHEDULE III - REAL ESTATE PROPERTIES AND ACCUMULATED DEPRECIATION (Details 2) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Sep. 30, 2016 |
Sep. 30, 2015 |
Sep. 30, 2014 |
Sep. 30, 2016 |
|
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | ||||
Total real estate properties | $ 838,259 | |||
Less: Accumulated depreciation and amortization | (44,687) | |||
Net real estate properties | $ 757,027 | $ 635,612 | $ 402,896 | $ 793,572 |
Reconciliation of real estate properties | ||||
Balance at beginning of year | 757,027 | 635,612 | 402,896 | |
Additions: | ||||
Acquisitions | 318,680 | 129,425 | 205,220 | |
Capital improvements | 19,649 | 8,442 | 8,273 | |
Capitalized development expenses and carrying costs | 27,194 | 55,623 | 34,857 | |
Total additions | 365,523 | 193,490 | 248,350 | |
Deductions: | ||||
Sales | 150,786 | 51,394 | 80 | |
Depreciation / amortization / paydowns | 24,328 | 20,681 | 15,554 | |
Reconciliation of partnership interest | 153,864 | 0 | 0 | |
Total deductions | 328,978 | 72,075 | 15,634 | |
Balance at end of year | $ 793,572 | $ 757,027 | $ 635,612 |
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