MARYLAND
|
13-3147497
|
|
(State
or other jurisdiction of
|
(I.R.S.
employer
|
|
incorporation
or organization)
|
identification
number)
|
60 Cutter Mill Road, Great Neck, New
York
|
11021
|
|
(Address
of principal executive offices)
|
(Zip
code)
|
Large accelerated filer ¨
|
Accelerated filer x
|
Non-accelerated filer ¨ (Do not check if a smaller reporting company) |
Smaller reporting company
¨
|
Page No.
|
||
|
||
September 30,
|
December 31,
|
|||||||
2010
|
2009
|
|||||||
(Unaudited)
|
||||||||
Assets
|
||||||||
Real
estate investments, at cost
|
||||||||
Land
|
$ | 111,124 | $ | 87,070 | ||||
Buildings
and improvements
|
317,943 | 301,100 | ||||||
429,067 | 388,170 | |||||||
Less
accumulated depreciation
|
52,349 | 46,286 | ||||||
376,718 | 341,884 | |||||||
Properties
held for sale
|
- | 3,809 | ||||||
Investment
in unconsolidated joint ventures
|
4,967 | 5,839 | ||||||
Cash
and cash equivalents
|
7,800 | 28,036 | ||||||
Available-for-sale
securities (including treasury bills of $3,999 in 2009)
|
407 | 6,762 | ||||||
Unbilled
rent receivable
|
11,849 | 10,706 | ||||||
Unamortized
intangible lease assets
|
7,565 | 7,157 | ||||||
Escrow,
deposits and other assets and receivables
|
5,183 | 2,471 | ||||||
Investment
in BRT Realty Trust at market (related party)
|
237 | 189 | ||||||
Unamortized
deferred financing costs
|
2,189 | 1,833 | ||||||
Total
assets
|
$ | 416,915 | $ | 408,686 | ||||
Liabilities
and Stockholders’ Equity
|
||||||||
Liabilities:
|
||||||||
Mortgages
payable
|
$ | 196,205 | $ | 190,518 | ||||
Line
of credit
|
27,800 | 27,000 | ||||||
Dividends
payable
|
3,445 | 2,456 | ||||||
Accrued
expenses and other liabilities
|
4,618 | 3,757 | ||||||
Unamortized
intangible lease liabilities
|
4,873 | 4,827 | ||||||
Total
liabilities
|
236,941 | 228,558 | ||||||
Commitments
and contingencies
|
- | - | ||||||
Stockholders’
equity:
|
||||||||
Preferred
stock, $1 par value; 12,500 shares authorized; none
issued
|
- | - | ||||||
Common
stock, $1 par value; 25,000 shares authorized; 11,161and 10,879
shares issued and outstanding
|
11,161 | 10,879 | ||||||
Paid-in
capital
|
146,193 | 143,272 | ||||||
Accumulated
other comprehensive (loss) income
|
(515 | ) | 191 | |||||
Accumulated
undistributed net income
|
23,135 | 25,786 | ||||||
Total
stockholders’ equity
|
179,974 | 180,128 | ||||||
Total
liabilities and stockholders’ equity
|
$ | 416,915 | $ | 408,686 |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Revenues:
|
||||||||||||||||
Rental
income
|
$ | 10,688 | $ | 9,453 | $ | 31,212 | $ | 28,754 | ||||||||
Lease
termination fee
|
- | - | - | 1,784 | ||||||||||||
Total
revenues
|
10,688 | 9,453 | 31,212 | 30,538 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
Depreciation
and amortization
|
2,197 | 2,100 | 6,440 | 6,334 | ||||||||||||
General
and administrative (including $597, $547, $1,791 and $1,641, respectively,
to related party)
|
1,695 | 1,643 | 5,261 | 4,895 | ||||||||||||
Real
estate acquisition costs
|
224 | - | 738 | - | ||||||||||||
Real
estate expenses
|
246 | 173 | 912 | 477 | ||||||||||||
Leasehold
rent
|
77 | 77 | 231 | 231 | ||||||||||||
Total
operating expenses
|
4,439 | 3,993 | 13,582 | 11,937 | ||||||||||||
Operating
income
|
6,249 | 5,460 | 17,630 | 18,601 | ||||||||||||
Other
income and expenses:
|
||||||||||||||||
Equity
in earnings of unconsolidated joint ventures
|
101 | 140 | 354 | 449 | ||||||||||||
Gain
on disposition of real estate held by unconsolidated
joint venture
|
- | - | 107 | - | ||||||||||||
Other
income, including realized gain on sale of available-for-sale securities
and interest income
|
40 | 85 | 265 | 292 | ||||||||||||
Interest:
|
||||||||||||||||
Expense
|
(3,658 | ) | (3,355 | ) | (10,639 | ) | (10,118 | ) | ||||||||
Amortization
of deferred financing costs
|
(160 | ) | (182 | ) | (452 | ) | (582 | ) | ||||||||
Income
from continuing operations
|
2,572 | 2,148 | 7,265 | 8,642 | ||||||||||||
Discontinued
operations:
|
||||||||||||||||
Income
from operations
|
39 | 395 | 165 | 1,226 | ||||||||||||
Net
gain on sales of real estate
|
235 | - | 235 | - | ||||||||||||
Gain
on troubled mortgage restructuring, as a result of conveyance to
mortgagee
|
- | 897 | - | 897 | ||||||||||||
Impairment
charge on property sold at a loss
|
- | - | - | (229 | ) | |||||||||||
Income
from discontinued operations
|
274 | 1,292 | 400 | 1,894 | ||||||||||||
Net
income
|
$ | 2,846 | $ | 3,440 | $ | 7,665 | $ | 10,536 | ||||||||
Weighted
average number of common shares outstanding:
|
||||||||||||||||
Basic
|
11,481 | 10,837 | 11,443 | 10,499 | ||||||||||||
Diluted
|
11,518 | 10,974 | 11,475 | 10,670 |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net
income per common share – basic:
|
||||||||||||||||
Income
from continuing operations
|
$ | .23 | $ | .20 | $ | .63 | $ | .82 | ||||||||
Income
from discontinued operations
|
.02 | .12 | .04 | .18 | ||||||||||||
Net
income per common share
|
$ | .25 | $ | .32 | $ | .67 | $ | 1.00 | ||||||||
Net
income per common share – diluted:
|
||||||||||||||||
Income
from continuing operations
|
$ | .23 | $ | .19 | $ | .63 | $ | .81 | ||||||||
Income
from discontinued operations
|
.02 | .12 | .04 | .18 | ||||||||||||
Net
income per common share
|
$ | .25 | $ | .31 | $ | .67 | $ | .99 | ||||||||
Cash
distribution declared per share of common stock
|
$ | .30 | $ | .02 | $ | .90 | $ | .06 | ||||||||
Stock
distribution declared per share of common stock
|
$ | - | $ | .20 | $ | - | $ | .60 |
Common
Stock
|
Paid-in
Capital
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Accumulated
Undistributed
Net Income
|
Total
|
||||||||||||||||
Balances,
January 1, 2009
|
$ | 9,962 | $ | 138,688 | $ | (239 | ) | $ | 15,564 | $ | 163,975 | |||||||||
Distributions
– common stock
|
||||||||||||||||||||
Cash
- $.08 per share
|
- | - | - | (948 | ) | (948 | ) | |||||||||||||
Stock
- $.80 per share
|
1,160 | 4,955 | - | (8,471 | ) | (2,356 | ) | |||||||||||||
Repurchase
of common stock
|
(268 | ) | (1,148 | ) | - | - | (1,416 | ) | ||||||||||||
Retirement
of common stock
|
(6 | ) | (45 | ) | (51 | ) | ||||||||||||||
Restricted
stock vesting
|
31 | (31 | ) | - | - | - | ||||||||||||||
Compensation
expense – restricted
stock
|
- | 853 | - | - | 853 | |||||||||||||||
Net
income
|
- | - | - | 19,641 | 19,641 | |||||||||||||||
Other
comprehensive income –
|
||||||||||||||||||||
Net
unrealized gain on available-for-sale securities
|
- | - | 319 | - | 319 | |||||||||||||||
Net
unrealized gain on derivative instruments
|
- | - | 111 | - | 111 | |||||||||||||||
Comprehensive
income
|
- | - | - | - | 20,071 | |||||||||||||||
Balances,
December 31, 2009
|
10,879 | 143,272 | 191 | 25,786 | 180,128 | |||||||||||||||
Distributions
– common stock
|
||||||||||||||||||||
Cash
- $.90 per share
|
- | - | - | (10,316 | ) | (10,316 | ) | |||||||||||||
Issuance
of stock for stock dividend obligation at December 31,
2009
|
216 | 1,888 | - | - | 2,104 | |||||||||||||||
Restricted
stock vesting
|
36 | (36 | ) | - | - | - | ||||||||||||||
Shares
issued through dividend reinvestment plan
|
30 | 396 | - | - | 426 | |||||||||||||||
Compensation
expense – restricted stock
|
- | 673 | - | - | 673 | |||||||||||||||
Net
income
|
- | - | - | 7,665 | 7,665 | |||||||||||||||
Other
comprehensive income -
|
||||||||||||||||||||
Net
unrealized loss on available-for-sale securities
|
- | - | (107 | ) | - | (107 | ) | |||||||||||||
Net
unrealized loss on derivative instrument
|
- | - | (599 | ) | - | (599 | ) | |||||||||||||
Comprehensive
income
|
- | - | - | - | 6,959 | |||||||||||||||
Balances,
September 30, 2010
|
$ | 11,161 | $ | 146,193 | $ | (515 | ) | $ | 23,135 | $ | 179,974 |
Nine Months Ended
September 30,
|
||||||||
2010
|
2009
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
income
|
$ | 7,665 | $ | 10,536 | ||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
Gain
on troubled mortgage restructuring, as a result of conveyance to
mortgagee
|
- | (897 | ) | |||||
Gain
on sale of available-for-sale securities
|
(149 | ) | - | |||||
Gain
on sale of real estate
|
(235 | ) | - | |||||
Impairment
charge on property sold at a loss
|
- | 229 | ||||||
Increase
in rental income from straight-lining of rent
|
(1,292 | ) | (810 | ) | ||||
Decrease
in rental income resulting from bad debt expense
|
93 | 475 | ||||||
Decrease
in rental income from amortization of intangibles relating to
leases
|
17 | 31 | ||||||
Amortization
of restricted stock expense
|
673 | 633 | ||||||
Gain
on disposition of real estate held by unconsolidated joint
venture
|
(107 | ) | - | |||||
Equity
in earnings of unconsolidated joint ventures
|
(354 | ) | (449 | ) | ||||
Distributions
of earnings from unconsolidated joint ventures
|
530 | 365 | ||||||
Depreciation
and amortization
|
6,497 | 6,893 | ||||||
Amortization
of financing costs
|
452 | 653 | ||||||
Changes
in assets and liabilities:
|
||||||||
Increase
in escrow, deposits, other assets and receivables
|
(1,198 | ) | (282 | ) | ||||
Increase
(decrease) in accrued expenses and other liabilities
|
397 | (428 | ) | |||||
Net
cash provided by operating activities
|
12,989 | 16,949 | ||||||
Cash
flows from investing activities:
|
||||||||
Purchase
of real estate and improvements
|
(23,964 | ) | (492 | ) | ||||
Net
proceeds from sale of real estate
|
4,137 | 1,764 | ||||||
Investment
in unconsolidated joint ventures
|
(150 | ) | (7 | ) | ||||
Distributions
of return of capital from unconsolidated joint ventures
|
953 | 57 | ||||||
Prepaid
tenant improvement allowance
|
(1,750 | ) | - | |||||
Net
proceeds from sale of available-for-sale securities
|
6,345 | - | ||||||
Purchase
of available-for-sale securities
|
- | (8,684 | ) | |||||
Net
cash used in investing activities
|
(14,429 | ) | (7,362 | ) | ||||
Cash
flows from financing activities:
|
||||||||
Regular
amortization payments of mortgages payable
|
(4,090 | ) | (4,327 | ) | ||||
Repayment
of mortgages payable
|
(10,687 | ) | (3,678 | ) | ||||
Proceeds
from mortgage financings
|
3,000 | 2,559 | ||||||
Proceeds
from bank line of credit
|
16,300 | - | ||||||
Repayment
on bank line of credit
|
(15,500 | ) | - | |||||
Issuance
of shares through dividend reinvestment plan
|
426 | - | ||||||
Payment
of financing costs, including mortgage assumption fees
|
(1,022 | ) | (208 | ) | ||||
Cash
distributions - common stock
|
(7,119 | ) | (2,698 | ) | ||||
Repurchase
of common stock
|
- | (1,416 | ) | |||||
Expenses
associated with stock issuance
|
(104 | ) | (127 | ) | ||||
Net
cash used in financing activities
|
(18,796 | ) | (9,895 | ) | ||||
Net
decrease in cash and cash equivalents
|
(20,236 | ) | (308 | ) | ||||
Cash
and cash equivalents at beginning of period
|
28,036 | 10,947 | ||||||
Cash
and cash equivalents at end of period
|
$ | 7,800 | $ | 10,639 |
Nine Months Ended
September 30,
|
||||||||
2010
|
2009
|
|||||||
Supplemental
disclosures of cash flow information:
|
||||||||
Cash
paid for interest
|
$ | 10,654 | $ | 11,654 | ||||
Supplemental
schedule of non-cash investing and financing activities:
|
||||||||
Common
stock dividend – portion paid in shares of Company’s common
stock
|
2,209 | 4,103 | ||||||
Assumption
of mortgage payable in connection with purchase of real
estate
|
17,654 | - | ||||||
Purchase
accounting allocation – intangible lease assets
|
1,078 | - | ||||||
Purchase
accounting allocation – intangible lease liabilities
|
357 | - | ||||||
Reclassification
of real estate owned to properties held for sale
|
- | 23,732 | ||||||
Reclassification
of assets related to properties held for sale
|
- | 1,824 | ||||||
Reclassification
of mortgages payable to mortgages payable – properties held for
sale
|
- | 9,069 | ||||||
Mortgage
debt extinguished upon conveyance of properties to mortgagee by
deeds-in-lieu of foreclosure
|
- | 8,706 | ||||||
Properties
conveyed to mortgagee
|
- | 8,075 | ||||||
Liabilities
extinguished upon transfer to mortgagee
|
- | 543 |
Description of Property
|
Date(s) Acquired
|
Purchase
Price
|
Terms of Payment and
Mortgage Information
|
Third Party
Real Estate
Acquisition
Costs (a)
|
|||||||
Community
shopping center,
Royersford,
Pennsylvania
|
February
28, 2010
|
$ | 23,500,000 |
Cash
and $17,700,000 mortgage assumption. Mortgage matures
May
2014 with interest at 5.67% per annum.
|
$ | 349,000 | |||||
Specialty
retail property,
Monroeville,
Pennsylvania
|
April
28, 2010
|
$ |
1,313,000,
including
$300,000
of
contracted
building
improvements
|
All
cash
|
$ | 49,000 | |||||
Retail
department store property,
Kansas
City, Missouri
|
June
30, 2010
|
$ | 8,950,000 |
All
cash
|
$ | 36,000 | |||||
Six
fast food restaurant locations,
Pennsylvania
(sale/leaseback transactions)
|
July
30, 2010 and
August
31, 2010
|
$ | 8,000,000 |
All
cash
|
$ | 189,000 |
|
(a)
|
Included
in the accompanying consolidated statements of
income.
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Rental
income, including $400 lease termination fee in the nine months
ended September 30, 2009
|
$ | 82 | $ | 931 | $ | 355 | $ | 3,329 | ||||||||
Depreciation
and amortization
|
9 | 119 | 57 | 612 | ||||||||||||
Real
estate expenses
|
(4 | ) | 9 | 8 | 255 | |||||||||||
Interest
expense
|
38 | 408 | 125 | 1,236 | ||||||||||||
Total
expenses
|
43 | 536 | 190 | 2,103 | ||||||||||||
Income
from operations
|
39 | 395 | 165 | 1,226 | ||||||||||||
Net
gain on sales of real property
|
235 | - | 235 | - | ||||||||||||
Impairment
charge on property sold at a loss
|
- | - | - | (229 | ) | |||||||||||
Gain
on troubled mortgage restructuring, as a result of conveyance to
mortgagee
|
- | 897 | - | 897 | ||||||||||||
Income
from discontinued operations
|
$ | 274 | $ | 1,292 | $ | 400 | $ | 1,894 |
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net
income
|
$ | 2,846 | $ | 3,440 | $ | 7,665 | $ | 10,536 | ||||||||
Other
comprehensive income -
|
||||||||||||||||
Net
unrealized (loss) gain on available-for-sale securities
|
25 | 283 | (107 | ) | 290 | |||||||||||
Net
unrealized (loss) gain on derivative instruments
|
(193 | ) | (201 | ) | (599 | ) | 22 | |||||||||
Comprehensive
income
|
$ | 2,678 | $ | 3,522 | $ | 6,959 | $ | 10,848 |
Three
Months Ended
September
30,
|
Nine
Months Ended
September
30,
|
|||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Restricted
share grants
|
875 | - | 875 | 102,750 | ||||||||||||
Average
per share grant price
|
$ | 14.64 | - | $ | 14.64 | $ | 6.09 | |||||||||
Recorded
as deferred compensation
|
$ | 13,000 | - | $ | 13,000 | $ | 626,000 | |||||||||
Total
charge to operations, all outstanding restricted grants
|
$ | 213,000 | $ | 221,000 | $ | 673,000 | $ | 633,000 | ||||||||
Non-vested
shares:
|
||||||||||||||||
Non-vested
beginning of period
|
321,875 | 285,650 | 357,925 | 213,625 | ||||||||||||
Grants
|
875 | - | 875 | 102,750 | ||||||||||||
Vested
during period
|
- | - | (36,050 | ) | (30,675 | ) | ||||||||||
Forfeitures
|
(1,810 | ) | - | (1,810 | ) | (50 | ) | |||||||||
Non-vested
end of period
|
320,940 | 285,650 | 320,940 | 285,650 | ||||||||||||
Average
value of non-vested shares (based on grant price)
|
$ | 13.33 | $ | 15.32 | $ | 13.33 | $ | 15.32 | ||||||||
Value
of shares vested during the period (based on grant price)
|
$ | - | $ | - | $ | 687,000 | $ | 602,000 |
Fair
Value
Measurements
Using
Fair Value
Hierarchy
|
||||||||||||||||
Carrying
and
Fair Value
|
Maturity
Date
|
Level 1
|
Level 2
|
|||||||||||||
Financial assets:
|
||||||||||||||||
Available-for-sale
securities:
|
||||||||||||||||
Equity
securities
|
$ | 644 | - | $ | 644 | $ | - | |||||||||
Financial liabilities:
|
||||||||||||||||
Derivative
financial instrument
|
488 | - | - | 488 |
Three Months Ended September 30,
|
Nine Months Ended September 30,
|
|||||||||||||||||||||||||||||||
2010
|
2009
|
Difference
|
%
Change
|
2010
|
2009
|
Difference
|
%
Change
|
|||||||||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||||||||||
Rental
income
|
$ | 10,688 | $ | 9,453 | $ | 1,235 | 13.1 | % | $ | 31,212 | $ | 28,754 | $ | 2,458 | 8.5 | % | ||||||||||||||||
Lease
termination fee
|
- | - | - | - | - | 1,784 | (1,784 | ) | n/a | |||||||||||||||||||||||
Total
revenues
|
10,688 | 9,453 | 1,235 | 13.1 | % | 31,212 | 30,538 | 674 | 2.2 | % | ||||||||||||||||||||||
Operating
expenses:
|
||||||||||||||||||||||||||||||||
Depreciation
and amortization
|
2,197 | 2,100 | 97 | 4.6 | % | 6,440 | 6,334 | 106 | 1.7 | % | ||||||||||||||||||||||
General
and administrative
|
1,695 | 1,643 | 52 | 3.2 | % | 5,261 | 4,895 | 366 | 7.5 | % | ||||||||||||||||||||||
Real
estate acquisition costs
|
224 | - | 224 | n/a | 738 | - | 738 | n/a | ||||||||||||||||||||||||
Real
estate expenses
|
246 | 173 | 73 | 42.2 | % | 912 | 477 | 435 | 91.2 | % | ||||||||||||||||||||||
Leasehold
rent
|
77 | 77 | - | - | 231 | 231 | - |
-
|
||||||||||||||||||||||||
Total
operating expenses
|
4,439 | 3,993 | 446 | 11.2 | % | 13,582 | 11,937 | 1,645 | 13.8 | % | ||||||||||||||||||||||
Operating
income
|
$ | 6,249 | $ | 5,460 | $ | 789 | 14.5 | % | $ | 17,630 | $ | 18,601 | $ | (971 | ) | (5.2 | )% |
Three Months Ended September 30,
|
Nine Months Ended September 30,
|
|||||||||||||||||||||||||||||||
2010
|
2009
|
Difference
|
%
Change
|
2010
|
2009
|
Difference
|
%
Change
|
|||||||||||||||||||||||||
Other
income and expenses:
|
||||||||||||||||||||||||||||||||
Equity
in earnings of unconsolidated
joint ventures
|
$ | 101 | $ | 140 | $ | (39 | ) | (27.9 | )% | $ | 354 | $ | 449 | $ | (95 | ) | (21.2 | )% | ||||||||||||||
Gain
on disposition of real estate
held by unconsolidated joint venture
|
- | - | - | - | 107 | - | 107 | n/a | ||||||||||||||||||||||||
Other
income, including realized gain on sale of available-for-sale securities
and interest income
|
40 | 85 | (45 | ) | (52.9 | )% | 265 | 292 | (27 | ) | (9.2 | )% | ||||||||||||||||||||
Interest:
|
||||||||||||||||||||||||||||||||
Expense
|
(3,658 | ) | (3,355 | ) | (303 | ) | 9.0 | % | (10,639 | ) | (10,118 | ) | (521 | ) | 5.1 | % | ||||||||||||||||
Amortization
of deferred financing costs
|
(160 | ) | (182 | ) | 22 | (12.1 | )% | (452 | ) | (582 | ) | 130 | (22.3 | )% |
Three Months Ended September 30,
|
Nine Months Ended September 30,
|
|||||||||||||||||||||||||||||||
2010
|
2009
|
Difference
|
%
Change
|
2010
|
2009
|
Difference
|
%
Change
|
|||||||||||||||||||||||||
Discontinued
operations:
|
||||||||||||||||||||||||||||||||
Income
from operations
|
$ | 39 | $ | 395 | $ | (356 | ) | (90.1 | )% | $ |