Securities Available For Sale

6 Months Ended

Jun. 30, 2016

Investments, Debt and Equity Securities [Abstract]

Securities Available For Sale

NOTE 3 – SECURITIES AVAILABLE FOR SALE

The Company’s Securities Available for Sale at Fair Value consists primarily of marketable common and preferred stock of other REITs with a fair value of $103,916,497 as of June 30, 2016. The Company generally limits its investment in marketable securities to no more than approximately 20% of its undepreciated assets. The REIT securities portfolio provides the Company with additional liquidity and additional income and serves as a proxy for real estate when more favorable risk adjusted returns are not available.

During the six months ended June 30, 2016, the Company sold securities with a cost basis of $6,695,855 and recognized a Gain on Sale of $1,014,378. The Company also made purchases of $17,193,903 in Securities Available for Sale. Of this amount, the Company made total purchases of 59,586 common shares of Monmouth Real Estate Investment Corporation (MREIC), a related REIT, through MREIC’s Dividend Reinvestment and Stock Purchase Plan for a total cost of $674,529 or weighted average cost of $11.32 per share. The Company owned a total of 2,184,857 MREIC common shares as of June 30, 2016 at a total cost of $18,529,583 and a fair value of $28,971,200.

As of June 30, 2016, the Company had total net unrealized gains of $16,352,163 in its REIT securities portfolio. The Company held five securities that had unrealized losses as of June 30, 2016. The Company considers many factors in determining whether a security is other than temporarily impaired, including the nature of the security and the cause, severity and duration of the impairment. The Company normally holds REIT securities long-term and has the ability and intent to hold these securities to recovery.

The following is a summary of the securities that the Company has determined to be temporarily impaired as of June 30, 2016:

	Less Than 12 Months					12 Months or Longer
	Fair		Unrealized			Fair		Unrealized
	Value		Loss			Value		Loss
Preferred Stock	$	101,480	$	(942	)	$	-0-	$	-0-
Common Stock		8,574,600		(1,763,987	)		-0-		-0-
Total	$	8,676,080	$	(1,764,929	)	$	-0-	$	-0-

The following is a summary of the range of the losses on these temporarily impaired securities:

Number of Individual Securities		Fair Value		Unrealized Loss			Range of Loss
	4	$	2,624,580	$	(19,004	)		0-1%
	1		6,051,500		(1,745,925	)		22%
	5	$	8,676,080	$	(1,764,929	)