Segment information

3 Months Ended

Jan. 31, 2013

Segment Information

Segment information

Note 7 - 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 seven (7) 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, 2012.

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 (“Board”).

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 periods ended January 31, 2013 and 2012. Asset information is not reported since FREIT does not use this measure to assess performance.

	Three Months Ended
	January 31,
	2013			2012
	(In Thousands)
Real estate rental revenue:
Commercial	$	5,862		$	6,092
Residential		4,659			4,683
Total real estate revenue		10,521			10,775
Real estate operating expenses:
Commercial		2,226			2,525
Residential		2,334			2,101
Total real estate operating expenses		4,560			4,626
Net operating income:
Commercial		3,636			3,567
Residential		2,325			2,582
Total net operating income	$	5,961		$	6,149
Recurring capital improvements-residential	$	(60	)	$	(173	)
Reconciliation to consolidated net income:
Segment NOI	$	5,961		$	6,149
Deferred rents - straight lining		(56	)		(7	)
Amortization of acquired leases		(6	)		9
Investment income		50			24
General and administrative expenses		(423	)		(369	)
Depreciation		(1,513	)		(1,522	)
Financing costs		(3,019	)		(2,815	)
Income from continuing operations		994			1,469
Income from discontinued operations		706			93
Net income		1,700			1,562
Net income attributable to noncontrolling interests		(229	)		(369	)
Net income attributable to common equity	$	1,471		$	1,193