-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KAaTFHRjmmTImSAqERyVoKc9CDf2oAy73jAIETU9suYX0Ube5KKCoyfqHGaI4cmj qA3b3eT7poAwl1zFKh0CQw== 0000914317-97-000301.txt : 19970624 0000914317-97-000301.hdr.sgml : 19970624 ACCESSION NUMBER: 0000914317-97-000301 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970618 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970623 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY CENTRAL INDEX KEY: 0000036840 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 221697095 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 002-27018 FILM NUMBER: 97627840 BUSINESS ADDRESS: STREET 1: 505 MAIN ST STREET 2: P O BOX 667 CITY: HACKENSACK STATE: NJ ZIP: 07602 BUSINESS PHONE: 2014886400 MAIL ADDRESS: STREET 1: P O BOX 667 STREET 2: 505 MAIN STREET CITY: HACKENSACK STATE: NJ ZIP: 07602 8-K 1 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: June 20, 1997 FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY (Exact name of registrant as specified in its charter) New Jersey 2-27018 22-1697095 - -------------------------------------------------------------------------------- (State or other (Commission File (I.R.S. Employer jurisdiction of number) Identification incorporation) Number) 505 Main Street, P.O. Box 667, Hackensack, New Jersey 07602 ----------------------------------------------------- ---------- (Address of principal executive office) (Zip Code) Registrant's telephone number, including area code 201-488-6400 Item 5. Other Events The Registrant has received a letter of comment from the Securities and Exchange Commission (the "SEC") dated May 28, 1997, a copy of which is attached to this 8-K under Item 7 (the "SEC Letter"). An amended 10K/A will be filed in response to the comments from the SEC. With respect to the SEC's comments set forth in the SEC Letter as to Note 1, the Registrant has agreed to use the equity method of accounting for its investment in the Westwood Hills, L.L.C. (the "LLC") for each accounting period commencing with the first quarter fiscal year 1997 and to restate all financial statements as they appeared in the 10-K filed for fiscal year 1996. Prior to the change to the equity method, the Registrant had reported its investment in the LLC on a consolidated basis. As a consequence of changing the accounting for the LLC to the equity method, the following is a summary of the significant changes which will occur: 1. The Combined Balance Sheets of the Registrant based upon the consolidated method of accounting for the LLC shows that the Total Assets, Total Liabilities, Minority Interest and Total Shareholder's Equity as of October 31, 1996 and 1995 were as follows:
1996 1995 ----------- ----------- Total Assets ....................... $65,222,000 $65,535,000 Total Liabilities .................. 42,350,000 42,587,000 Minority Interest .................. 2,888,000 2,959,000 Total Shareholders' Equity ......................... 19,984,000 19,989,000
2. As a result of the change to the equity method of accounting, the Restated Balance Sheets of the Registrant will show that Total Assets, Total Liabilities and Total Shareholders' Equity as of October 31, 1996 and 1995 will be as follows:
1996 1995 ----------- ----------- Total Assets ....................... $51,674,000 $51,838,000 Total Liabilities .................. 31,690,000 31,849,000 Total Shareholders' Equity ......................... 19,984,000 19,989,000
3. The Combined Statements of Income and Undistributed Earnings for the years ended October 31, 1996, 1995 and 1994, based upon the consolidated method of accounting for the LLC, were as follows:
1996 1995 1994 ----------- ----------- ----------- Total Revenues ........ $13,678,000 $13,250,000 $11,162,000 Total Expenses ........ 10,218,000 9,592,000 8,235,000 Net Income ............ 2,662,000 2,786,000 2,383,000 Earnings per share ........... $ 1.71 $ 1.79 $ 1.53
4. As a result of the change to the equity method of accounting, the Statements of Income and Undistributed Earnings for the years ended October 31, 1996, 1995 and 1994 will be as follows:
1996 1995 1994 ----------- ----------- ----------- Total Revenues ........ $11,318,000 $11,038,000 $10,279,000 Total Expenses ........ 8,091,000 7,585,000 7,479,000 Net Income ............ 2,662,000 2,786,000 2,383,000 Earnings per share ........... $ 1.71 $ 1.79 $ 1.53
5. The foregoing discussion is a summary based upon revised financial statements which will be incorporated into the 10K/A to be filed by the Registrant. Any interested parties should review all of the financial information which will be set forth in the 10K/A. Item 7: Financial Statements and Exhibits. 1. Letter from the SEC dated May 28, 1997. Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. FREIT By: /s/Robert S. Hekemian --------------------- Robert S. Hekemian Chairman of the Board DATED: June 20, 1997 [GRAPHIC-DIVISION OF CORPORATION FINANCE LOGO] UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Stop 7-2 May 28, 1997 Mr. Robert S. Hekemian, Chief Executive Officer Hekemian & Co., Inc. 505 Main Street, P.O. Box 667 Hackensack, New Jersey 07602 Re: First Real Estate Investment Trust of New Jersey Form 10K for the fiscal year ended October 31, 1996 Filed on January 30, 1997 File Number: 2-27018 Form 10Q for the quarter ended January 31, 1997 Filed on April 1, 1997 File Number: 2-48728 Dear Mr. Hekemian: The staff has reviewed only the portions of this filing related to the financial statements and management's discussion and analysis and has the following accounting comments. Form 10K - -------- Management's Discussion and Analysis of Financial Condition and - --------------------------------------------------------------- Results of Operations - --------------------- Expand this section to include a discussion of the 1995 amounts in comparison with 1994 amounts in accordance with Item 303 of Regulation S-X. Revise this section to state whether the known trend of rental expenses which are growing at a faster rate than rental revenue is expected to continue. Describe management's plans to address this trend. Note 4. Mortgages Payable - ------------------------- Revise this note to include the disclosures required by FASB 107. Mr. Robert S. Hekemian May 28, 1997 Page 2 Note 1. Accounting Policies - --------------------------- Revise this note to explain the basis for the consolidation of Westwood Hills LLC. Unless the registrant can demonstrate that it unilaterally controls the LLC, revise the financial statements to use the equity method of accounting for the investment in the LLC and include separate financial statements of the LLC pursuant to Rule 3-09 of Regulation S-X. See, generally, SOP 78-9. Form 10Q - -------- Note 3. Mortgages Payable - ------------------------- Expand the filing to include a disclosure which describes the registrant's current efforts to obtain alternative financing in order to pay off the State Mutual Life Insurance Co. mortgage obligation prior to its August 1, 1997 maturity. See Item 303 of Regulation S-X. The supplemental information which has been requested above should either be submitted by June 9, 1997, or the staff should be advised by that date when such information will be forthcoming. In the event compliance with the above comments is not deemed appropriate by the registrant, the basis therefore should be provided to the staff in a supplemental letter as promptly as possible. Questions regarding the above accounting comments may be directed to Allen E. Webb at (202) 942-1868 or Hugh Miller III, the Assistant Chief Accountant at (202) 942-1962 and questions on other disclosure issues may be directed to Paula Dubberly, the Assistant Director, at (202) 942-1960. Sincerely, /s/ Hugh Miller III ------------------- Hugh Miller III Assistant Chief Accountant -----END PRIVACY-ENHANCED MESSAGE-----