Segment information

3 Months Ended

Jan. 31, 2012

Segment Information

Segment information

Note 4 - Segment information:

FREIT has determined that it has two reportable segments: commercial properties and residential properties. These reportable segments offer different types of space, have different types of tenants, and are managed separately because each requires different operating strategies and management expertise. The commercial segment contains ten (10) separate properties and the residential segment contains nine (9) properties. The accounting policies of the segments are the same as those described in Note 1 in FREIT’s Annual Report on Form 10-K for the fiscal year ended October 31, 2011.

The chief operating and decision-making group of FREIT’s commercial segment, residential segment and corporate/other is comprised of FREIT’s Board of Trustees.

FREIT assesses and measures segment operating results based on net operating income (“NOI”). NOI, a standard used by real estate professionals, 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 items. NOI is not a measure of operating results or cash flows from operating activities as measured by GAAP, 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.

Real estate rental revenue, operating expenses, NOI and recurring capital improvements for the reportable segments are summarized below and reconciled to condensed consolidated net income-common equity for the three-month period ended January 31, 2012 and 2011. Asset information is not reported since FREIT does not use this measure to assess performance.

	Three Months Ended January 31,
	2012			2011
	(In thousands)
Real estate rental revenue:
Commercial	$	6,092		$	5,936
Residential		4,986			4,877
Totals		11,078			10,813
Real estate operating expenses:
Commercial		2,525			2,546
Residential		2,252			2,154
Totals		4,777			4,700
Net operating income:
Commercial		3,567			3,390
Residential		2,734			2,723
Totals	$	6,301		$	6,113
Recurring capital improvements-residential	$	202		$	84
Reconciliation to consolidated net income:
Segment NOI	$	6,301		$	6,113
Deferred rents - straight lining		(7	)		54
Amortization of acquired leases		9			(6	)
Investment income		24			29
General and administrative expenses		(369	)		(393	)
Depreciation		(1,531	)		(1,511	)
Financing costs		(2,865	)		(2,926	)
Net income		1,562			1,360
Net income attributable to noncontrolling interests		(369	)		(341	)
Net income attributable to common equity	$	1,193		$	1,019