First Real Estate Investment Trust of New Jersey Inc (FREVS, Financial) released its 8-K filing on September 13, 2024, detailing its financial performance for the fiscal quarter ended July 31, 2024. The company operates in the real estate sector of the United States, focusing on both commercial and residential properties. Its revenues primarily consist of fixed rental income and additional rent from expense reimbursements.
Performance Overview
For the fiscal quarter ended July 31, 2024, First Real Estate Investment Trust of New Jersey Inc (FREVS, Financial) reported a decrease in total real estate revenue by 2% to approximately $7.15 million, compared to $7.30 million in the same period last year. This decline was mainly due to a $433,000 decrease in the commercial segment, driven by Kmart vacating its space at the Westwood Plaza Shopping Center. However, the residential segment saw an increase of $284,000, primarily due to higher base rents while maintaining an average occupancy rate of 96.8%.
Financial Achievements
Net income attributable to common equity was approximately $14.79 million, or $1.98 per share, for the fiscal quarter, a significant improvement from a net loss of $412,000, or $0.06 per share, in the prior year's comparable period. This change was primarily driven by a litigation settlement, net of fees, amounting to approximately $15.71 million, of which FREIT's share was approximately $14.14 million. Additionally, general and administrative expenses declined by approximately $630,000, contributing to the improved net income.
Key Financial Metrics
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| GAAP Earnings (Loss) Per Share | $1.98 | ($0.06) | + $2.04 |
| AFFO Per Share | $0.18 | $0.10 | + $0.08 |
| Dividends Per Share | $0.05 | $0.30 | - $0.25 |
| Total Average Residential Occupancy | 96.8% | 96.8% | No Change |
| Total Average Commercial Occupancy | 51.8% | 65.1% | - 13.3% |
Income Statement Highlights
For the nine months ended July 31, 2024, total real estate revenue increased by 1.1% to approximately $21.42 million, compared to $21.19 million in the prior year's comparable period. The residential segment contributed an increase of $920,000, while the commercial segment saw a decrease of $690,000. Net income for the nine months was approximately $14.81 million, or $1.99 per share, compared to $104,000, or $0.01 per share, in the prior year's comparable period.
Segment Performance
Net Operating Income (NOI) for residential properties increased to approximately $3.10 million for the fiscal quarter and $8.91 million for the nine months ended July 31, 2024. In contrast, NOI for commercial properties decreased to approximately $756,000 for the fiscal quarter and $2.23 million for the nine months ended July 31, 2024.
Financing Update
On May 1, 2024, FREIT entered into a loan extension and modification agreement with Provident Bank, extending the maturity date of a loan secured by an apartment building in River Edge, New Jersey, to May 31, 2027. The loan has a fixed interest rate of 6.75% and requires monthly installments of principal and interest of approximately $58,016.
Dividend Declaration
The Board of Directors declared a third-quarter dividend of $0.05 per share, payable on September 13, 2024, to shareholders of record as of August 30, 2024. The Board will continue to evaluate the dividend on a quarterly basis.
Adjusted Funds From Operations (AFFO)
Adjusted Funds From Operations (AFFO) for the fiscal quarter ended July 31, 2024, was $1.32 million, or $0.18 per share, compared to $739,000, or $0.10 per share, in the prior year's comparable period. For the nine months ended July 31, 2024, AFFO was $3.14 million, or $0.42 per share, compared to $2.94 million, or $0.40 per share, in the prior year's comparable period.
For more detailed information, please refer to the 8-K filing.
Explore the complete 8-K earnings release (here) from First Real Estate Investment Trust of New Jersey Inc for further details.
