8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15 (d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

September 3, 2010

FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY

(Exact name of registrant as specified in charter)

New Jersey	000-25043	22-1697095
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

505 Main Street, Hackensack, New Jersey	07601
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (201) 488-6400

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2 (b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange  Act (17 CFR 240.13e-4 (c))

Item 2.02  Results of Operations and Financial Condition

OPERATING RESULTS

The registrant has released its operating results for the nine and three month periods ended July 31, 2010.  The Press Release is included as Exhibit 99.1 to this Form 8-K.

Item 9.01  Financial Statements and Exhibits

(d)  Exhibits

99.1  Registrant’s press release dated September 3, 2010

The statements in this report that relate to future earnings or performance are forward-looking. Actual results might differ materially and be adversely affected by such factors as longer than anticipated lease-up periods or the inability of tenants to pay increased rents. Additional information about these factors is contained in the Trust’s filings with the SEC including the Trust’s most recent filed report on Form 10-K and Form 10-Q.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY
(Registrant)
By:	/s/ Robert S. Hekemian
	Robert S. Hekemian
	Chairman of the Board

Date:  September 3, 2010

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EXHIBIT INDEX

Exhibit
Number	Description
99.1	Press Release – Operating results for the nine and three month periods ended July 31, 2010.

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EX-99.1

Exhibit 99.1

HACKENSACK, NJ,   September 3, 2010 – First Real Estate Investment Trust (“FREIT”) announced its operating results for the nine and three-months ended July 31, 2010. The results of operations as presented in this earnings release are unaudited, and are not necessarily indicative of future operating results.

FINANCIAL HIGHLIGHTS	Nine Months Ended July 31, 2010	Three Months Ended July 31, 2010
*  Net Income Per Share-Basic:	$0.53	$0.20
*  Dividends Per Share:	$0.90	$0.30
*  FFO Per Share-Basic:	$1.11	$0.37
*  FFO Payout:	81.1%	81.1%
*  Average Residential Occupancy:	94.0%	94.4%
*  Average Commercial Occupancy:	89.9%	89.3%

RESULTS OF OPERATIONS

Real Estate revenue for the nine months ended July 31, 2010 (“Current Nine Months”) increased 3.9% to $33,056,000 compared to $31,803,000 for the nine months ended July 31, 2009 (“Prior Nine Months”). Real Estate revenue for the three months ended July 31, 2010 (“Current Quarter”) increased 3.5% to $10,847,000 compared to $10,484,000 for the three months ended July 31, 2009 (“Prior Year’s Quarter”).

Net income attributable to common equity (“Net Income”) for the Current Nine Months was $3,678,000 ($0.53 per share basic) compared to $4,180,000 ($0.60 per share basic) for the Prior Nine Months. Net Income for the Current Quarter was $1,376,000 ($0.20 per share basic) compared to $1,574,000 ($0.23 per share basic) for the Prior Year’s Quarter. The schedule below provides a detailed analysis of the major changes that impacted Net Income for the nine and three months ended July 31, 2010 and 2009:

	Nine Months Ended July 31,									Three Months Ended July 31,
	2010			2009			Change			2010			2009			Change
	(in thousands, except per share)									(in thousands, except per share)
Real estate revenues:
Commercial properties	$	18,757		$	17,366		$	1,391		$	6,058		$	5,789		$	269
Residential properties		14,299			14,437			(138	)		4,789			4,695			94
Total real estate revenues		33,056			31,803			1,253			10,847			10,484			363
Operating expenses:
Real estate operations		14,238			13,193			1,045			4,532			4,206			326
General and administrative		1,233			1,329			(96	)		392			449			(57	)
Depreciation		4,556			4,407			149			1,492			1,470			22
Total operating expenses		20,027			18,929			1,098			6,416			6,125			291
Operating income		13,029			12,874			155			4,431			4,359			72
Investment income		95			170			(75	)		29			40			(11	)
Financing costs		(8,703	)		(8,051	)		(652	)		(2,922	)		(2,670	)		(252	)
Net income		4,421			4,993			(572	)		1,538			1,729			(191	)
Net income attributable to noncontrolling interests (formerly referred to as minority interests)		(743	)		(813	)		70			(162	)		(155	)		(7	)
Net income attributable to common equity	$	3,678		$	4,180		$	(502	)	$	1,376		$	1,574		$	(198	)
Earnings per share-basic (attributable to common equity)	$	0.53		$	0.60		$	(0.07	)	$	0.20		$	0.23		$	(0.03	)
Weighted average shares outstanding		6,942			6,944						6,942			6,942

SEGMENT INFORMATION

The following table sets forth comparative net operating income ("NOI")data for FREIT’s real estate segments and reconciles the NOI to consolidated net income for the Current Nine Months and Current Quarter, as compared to the prior year’s comparable periods:

	Commercial												Residential												Combined
	Nine Months Ended												Nine Months Ended												Nine Months Ended
	July 31,						Increase (Decrease)						July 31,						Increase (Decrease)						July 31,
	2010			2009			$			%			2010			2009			$			%			2010			2009
	(in thousands)												(in thousands)												(in thousands)
Rental income	$	14,041		$	13,108		$	933			7.1	%	$	14,125		$	14,197		$	(72	)		-0.5	%	$	28,166		$	27,305
Reimbursements		4,458			3,969			489			12.3	%		-			-			-						4,458			3,969
Other		118			153			(35	)		-22.9	%		174			240			(66	)		-27.5	%		292			393
Total revenue		18,617			17,230			1,387			8.0	%		14,299			14,437			(138	)		-1.0	%		32,916			31,667
Operating expenses		7,337			6,815			522			7.7	%		6,901			6,378			523			8.2	%		14,238			13,193
Net operating income	$	11,280		$	10,415		$	865			8.3	%	$	7,398		$	8,059		$	(661	)		-8.2	%		18,678			18,474
Average
Occupancy %		89.9	%		89.2	%					0.7	%		94.0	%		93.0	%					1.0	%
										Reconciliation to consolidated net income:
										Deferred rents - straight lining																162			163
										Amortization of acquired leases																(22	)		(27	)
										Investment income																95			170
										General and administrative expenses																(1,233	)		(1,329	)
										Depreciation																(4,556	)		(4,407	)
										Financing costs																(8,703	)		(8,051	)
										Net income																4,421			4,993
										Net income attributable to noncontrolling interests																(743	)		(813	)
										Net income attributable to common equity															$	3,678		$	4,180

	Commercial												Residential											Combined
	Three Months Ended												Three Months Ended											Three Months Ended
	July 31,						Increase (Decrease)						July 31,						Increase (Decrease)					July 31,
	2010			2009			$			%			2010			2009			$		%			2010			2009
	(in thousands)												(in thousands)											(in thousands)
Rental income	$	4,408		$	4,363		$	45			1.0	%	$	4,731		$	4,637		$	94		2.0	%	$	9,139		$	9,000
Reimbursements		1,568			1,327			241			18.2	%		-			-			-					1,568			1,327
Other		36			49			(13	)		-26.5	%		58			58			-		0.0	%		94			107
Total revenue		6,012			5,739			273			4.8	%		4,789			4,695			94		2.0	%		10,801			10,434
Operating expenses		2,333			2,094			239			11.4	%		2,199			2,112			87		4.1	%		4,532			4,206
Net operating income	$	3,679		$	3,645		$	34			0.9	%	$	2,590		$	2,583		$	7		0.3	%		6,269			6,228
Average
Occupancy %		89.3	%		89.8	%					-0.5	%		94.4	%		91.8	%				2.6	%
										Reconciliation to consolidated net income:
										Deferred rents - straight lining															53			59
										Amortization of acquired leases															(7	)		(9	)
										Investment income															29			40
										General and administrative expenses															(392	)		(449	)
										Depreciation															(1,492	)		(1,470	)
										Financing costs															(2,922	)		(2,670	)
										Net income															1,538			1,729
										Net income attributable to noncontrolling interests															(162	)		(155	)
										Net income attributable to common equity														$	1,376		$	1,574

The Current Quarter represents the fourth consecutive quarter of increases in NOI from FREIT’s properties.

NOI is based on operating revenue and expenses directly associated with the operations of the real estate properties, but excludes deferred rents (straight lining), lease amortization, depreciation, financing costs and other non-operating activity. FREIT assesses and measures segment operating results based on NOI. NOI is not a measure of operating results or cash flow as measured by generally accepted accounting principles, and is not necessarily indicative of cash available to fund cash needs and should not be considered an alternative to cash flows as a measure of liquidity.

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COMMERCIAL SEGMENT

Total revenue and NOI from FREIT’s commercial segment for the Current Nine Months increased by 8.0% and 8.3%, respectively, over the Prior Nine Months. The primary reasons for the increase in total revenue and NOI for the Current Nine Months were higher base rental income, primarily at the Damascus Center, a $250,000 lease termination fee related to a tenant at the Rotunda shopping center, and a percentage rent payment of $123,000 relating to a tenant coming off of a percentage rent holiday. For the Current Quarter, total revenue and NOI increased by 4.8% and 0.9%, respectively, over the Prior Year’s Quarter, which was primarily attributable to higher base rental income, and higher reimbursable operating expenses over last year.

The U.S. economy has recovered from the recession, but at a recovery rate much slower than anticipated. Retail sales over the past year have posted slight gains, although among retailers, results have been mixed. The biggest problem in our areas of operations continues to be unemployment, renewing worries that consumers are still nervous about their jobs and reluctant to increase spending. To date, our tenant fall-out has been minor, as average occupancy (exclusive of the Damascus Center, which is undergoing a major redevelopment project) for the Current Nine Months was 94.4%, a decrease of 0.9% from last year’s comparable period, and a decrease of 1.5% for the Current Quarter to 94.1% as compared to 95.6% for the Prior Year’s Quarter. However, we may experience additional fall-out if the economic recovery slows down any fu rther, or stalls.

On July 7, 2010, FREIT’s Board of Trustees authorized management to pursue a sale of the Westridge Square Shopping Center located in Frederick, Maryland. The decision to sell the property (acquired in 1992) was based on the Board’s desire to re-deploy the net proceeds of the sale to real estate assets in other areas of FREIT’s operations. It is the intention of the Board to structure the sale as a like-kind exchange (Code Sec.1031), in order to defer the income taxes on the expected gain. The property is not as yet being actively marketed for sale. Due to current conditions in the commercial real estate market, it is not possible for management to estimate when the sale of the property will occur.

RESIDENTIAL SEGMENT

Total revenue and NOI from FREIT’s residential segment for the Current Nine Months decreased by 1.0% and 8.2%, respectively, as compared to the Prior Nine Months. The decrease in total revenue and NOI for the Current Nine Months was primarily attributable to higher than normal unemployment in our areas of operation over the past year, which was exacerbated by losses approximating $260,000 resulting from recent storm damage costs at the Pierre Towers apartment complex, and overall higher operating costs, particularly utility costs caused by the colder winter this year. However, for the Current Quarter, total revenue and NOI increased by 2.0% and 0.3%, respectively, over the Prior Year’s Quarter. The positive operating results for the Current Quarter reflect the upward movement of occupancy and rents during the current fiscal year, as evidenced by average occupancy for the Current Nine Months and Current Quarter increasing by 1.0% and 2.6%, respectively, over last year’s comparable periods.

FUNDS FROM OPERATIONS (“FFO”):

Many consider FFO, which is a non-GAAP financial measure, as the standard measurement of a REIT’s performance. We compute FFO as follows:

	Nine Months Ended						Three Months Ended
	July 31,						July 31,
	2010			2009			2010			2009
	($ in thousands)						($ in thousands)
Net income	$	4,421		$	4,993		$	1,538		$	1,729
Depreciation		4,556			4,407			1,492			1,470
Amortization of deferred mortgage costs		167			174			61			57
Deferred rents (Straight lining)		(162	)		(163	)		(53	)		(59	)
Amortization of acquired leases		22			27			7			9
Capital Improvements - Apartments		(254	)		(143	)		(134	)		(36	)
Distributions to noncontrolling interests		(1,022	)		(820	)		(330	)		(257	)
FFO	$	7,728		$	8,475		$	2,581		$	2,913
FFO Per Share-Basic	$	1.11		$	1.22		$	0.37		$	0.42
Weighted Average Shares Outstanding		6,942			6,944			6,942			6,942

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FFO does not represent cash generated from operating activities in accordance with accounting principles generally accepted in the United States of America, and therefore should not be considered a substitute for net income as a measure of results of operations or for cash flow from operations as a measure of liquidity. Additionally, the application and calculation of FFO by certain other REITs may vary materially from that of FREIT’s, and therefore FREIT’s FFO and the FFO of other REITs may not be directly comparable.

DIVIDENDS

The 3rd quarter dividend of $0.30 per share is payable on September 15, 2010 to shareholders of record on September 1, 2010.

The statements in this report that relate to future earnings or performance are forward-looking. Actual results might differ materially and be adversely affected by such factors as longer than anticipated lease-up periods or the inability of tenants to pay increased rents. Additional information about these factors is contained in the Trust’s filings with the SEC including the Trust’s most recent filed report on Form 10-K and Form 10-Q.

First Real Estate Investment Trust is a publicly traded (over-the-counter – symbol FREVS) REIT organized in 1961. It has approximately $244 million (historical cost basis) of assets. Its portfolio of residential and commercial properties extends from Eastern L.I. to Maryland, with the largest concentration in Northern New Jersey.

For additional information contact Shareholder Relations at (201) 488-6400

Visit us on the web:  www.freitnj.com

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