Segment Information

9 Months Ended

Jul. 31, 2023

Segment Information [Abstract]

Segment information

Note 11 - Segment information:

ASC 280-10, "Disclosures about Segments of an Enterprise and Related Information", establishes standards for reporting financial information about operating segments in interim and annual financial reports and provides for a "management approach" in identifying the reportable segments. 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 is comprised of five (5) properties, excluding the Rotunda Property, the Westridge Square Property and the Damascus Property, which were sold on December 30, 2021, January 7, 2022 and January 10, 2022, respectively. The residential segment is comprised of six (6) properties, excluding the Icon at the Rotunda Property, which was sold as part of the Maryland Properties on December 30, 2021. (See Note 7 for further details.)

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, 2022. The chief operating and decision-making group responsible for oversight and strategic decisions of FREIT's commercial segment, residential segment and corporate/other is comprised of FREIT’s Board.

FREIT, through its chief operating and decision making group, 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), 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 (loss) attributable to common equity for the nine and three months ended July 31, 2023 and 2022. Asset information is not reported since FREIT does not use this measure to assess performance.

	Nine Months Ended						Three Months Ended
	July 31,						July 31,
	2023			2022			2023			2022
	(In Thousands of Dollars)						(In Thousands of Dollars)
Real estate rental revenue:
Commercial	$	6,613		$	8,445		$	2,275		$	2,179
Residential		14,669			15,803			5,036			4,744
Total real estate rental revenue		21,282			24,248			7,311			6,923
Real estate operating expenses:
Commercial		3,782			5,146			1,294			1,227
Residential		6,526			6,788			2,189			2,101
Total real estate operating expenses		10,308			11,934			3,483			3,328
Net operating income:
Commercial		2,831			3,299			981			952
Residential		8,143			9,015			2,847			2,643
Total net operating income	$	10,974		$	12,314		$	3,828		$	3,595
Recurring capital improvements - residential	$	(407	)	$	(401	)	$	(117	)	$	(195	)
Reconciliation to condensed consolidated net income (loss) attributable to common equity:
Segment NOI	$	10,974		$	12,314		$	3,828		$	3,595
Deferred rents - straight lining		(91	)		(25	)		(15	)		36
Investment income		682			183			275			119
General and administrative expenses		(3,361	)		(3,107	)		(1,559	)		(911	)
Loss (gain) on investment in tenancy-in-common		(231	)		(99	)		(43	)		57
Depreciation		(2,198	)		(3,257	)		(744	)		(723	)
Net (loss) gain on sale of Maryland properties		(1,003	)		68,771			(557	)		-
Net realized gain on Wayne PSC interest rate swap contract termination		-			1,415			-			1,415
Financing costs		(5,858	)		(6,229	)		(2,031	)		(1,774	)
Net (loss) income		(1,086	)		69,966			(846	)		1,814
Net loss (income) attributable to noncontrolling interests in subsidiaries		1,190			(23,420	)		434			(693	)
Net income (loss) attributable to common equity	$	104		$	46,546		$	(412	)	$	1,121