REAL ESTATE INVESTMENTS

6 Months Ended

Apr. 30, 2017

REAL ESTATE INVESTMENTS [Abstract]

REAL ESTATE INVESTMENTS

(2) REAL ESTATE INVESTMENTS

In March 2017, the Company, through a wholly-owned subsidiary, purchased, for $7.1 million, a 36,500 square foot grocery anchored shopping center located in Passaic, NJ ("Passaic Property").  The Company funded the purchase with available cash, the assumption of a mortgage note secured by the property in the amount of $3.5 million (see note 4) and proceeds from the sale of the Company's White Plains, NY property (see note 1).

In March 2017, the Company purchased for $3.1 million, a 12,900 square foot single tenant property located in Fairfield, CT.  The property is leased to Walgreen's (the "Walgreens Property").

In January 2017, the Company, through a wholly-owned subsidiary, purchased for $9.0 million, a 38,800 square foot grocery anchored shopping center located in Derby, CT ("Derby Property").  The Company funded the purchase with a combination of available cash and borrowings on its Facility.

The Company evaluated the above transactions, under the new framework for determining whether an integrated set of assets and activities meets the definition of a business, pursuant to ASU 2017-01, which the Company early-adopted effective November 1, 2016. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions (see note 1).

Accordingly, the Company accounted for the purchase of the Derby Property, the Passaic Property, the Walgreen's Property and three properties acquired through a joint venture which the Company consolidates (see note 5) as asset acquisitions and allocated the total cash consideration, including transaction costs, to the individual assets and liabilities acquired on a relative fair value basis.

The financial information set forth below summarizes the Company's purchase price allocation for the properties acquired during the six months ended April 30, 2017 (in thousands).

	Derby		Passaic		Walgreen's		High Ridge		Chase		CVS
Assets:
Land	$	651	$	2,038	$	572	$	17,145	$	2,373	$	2,293
Building and improvements	$	7,652	$	5,614	$	1,323	$	43,593	$	1,456	$	2,697
In-place leases	$	771	$	480	$	80	$	1,552	$	121	$	181
Above market leases	$	-	$	-	$	1,090	$	335	$	288	$	-
Liabilities:
In-place leases	$	-	$	-	$	-	$	-	$	-	$	-
Below Market Leases	$	-	$	769	$	-	$	263	$	-	$	373

The following table summarizes the operating results included in the Company's historical consolidated statements of income for the properties acquired during the first six months of fiscal 2017 (in thousands).

	Six Months		Three Months
	Ended		Ended
	April 30, 2017		April 30, 2017
Revenues	$	986	$	940
Net income attributable to Urstadt Biddle Properties Inc.	$	474	$	461

Prior to adopting ASU 2017-01, the Company acquired two properties in fiscal 2016, which were accounted for as business combinations as required by ASC Topic 805.  ASC Topic 805 required the fair value of the real estate purchased to be allocated to the acquired tangible assets (consisting of land, buildings and building improvements), and identified intangible assets and liabilities (consisting of above-market and below-market leases and in-place leases).  Acquisition costs related to the business combinations were expensed as incurred.

In April 2017, the Company completed the process of analyzing the fair value of the acquired assets and liabilities, including intangible assets and liabilities, for the Newfield Green and the 970 High Ridge Road properties acquired in 2016 and has made the following purchase price adjustments to land and building based on the fair market value of intangible assets acquired when the properties were purchased (in thousands).

	Newfield Green		970 High Ridge Road
Assets:
In-place leases	$	961	$	62
Above market leases	$	118	$	-
Liabilities:
In-place leases	$	-	$	-
Below market leases	$	1,061	$	74

The value of above and below market leases are amortized as a reduction/increase to base rental revenue over the term of the respective leases.  The value of in-place leases described above are amortized as an expense over the terms of the respective leases.

For the six month periods ended April 30, 2017 and 2016, the net amortization of above-market and below-market leases was approximately $95,000 and $135,000, respectively, which is included in base rents in the accompanying consolidated statements of income.