Securities Available For Sale |
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| 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:
The following is a summary of the range of the losses on these temporarily impaired securities:
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