Securities Available for Sale

9 Months Ended

Sep. 30, 2017

Investments, Debt and Equity Securities [Abstract]

Securities Available for Sale

NOTE 4 – 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 $132,212,410 as of September 30, 2017. 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 nine months ended September 30, 2017, the Company sold securities with a cost basis of $10,660,124 and recognized a Gain on Sale of $1,518,289. The Company also made purchases of $38,002,778 in Securities Available for Sale. Of this amount, the Company made total purchases of 75,836 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 $1,084,324 or weighted average cost of $14.30 per share. The Company owned a total of 2,313,424 MREIC common shares as of September 30, 2017 at a total cost of $20,315,735 and a fair value of $37,454,330.

As of September 30, 2017, the Company had total net unrealized gains of $12,831,755 in its REIT securities portfolio. The Company held ten securities that had unrealized losses as of September 30, 2017. 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 September 30, 2017:

	Less Than 12 Months					12 Months or Longer
	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
Preferred Stock	$	542,280	$	(2,396	)	$	-0-	$	-0-
Common Stock		67,438,450		(5,249,555	)		-0-		-0-
Total	$	67,980,730	$	(5,251,951	)	$	-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
8	$	52,273,480	$	(1,364,570	)		0-4	%
1		3,332,000		(302,882	)		8	%
1		12,375,250		(3,584,499	)		22	%
10	$	67,980,730	$	(5,251,951	)