ACQUISITIONS, DEVELOPMENTS PLACED IN SERVICE AND DISPOSITIONS

3 Months Ended

Jul. 31, 2014

ACQUISITIONS, DEVELOPMENTS PLACED IN SERVICE AND DISPOSITIONS [Abstract]

ACQUISITIONS, DEVELOPMENTS PLACED IN SERVICE AND DISPOSITIONS

NOTE 8 • ACQUISITIONS, DEVELOPMENTS PLACED IN SERVICE AND DISPOSITIONS

PROPERTY ACQUISITIONS

The Company added approximately $26.6 million of real estate properties to its portfolio through property acquisitions during the three months ended July 31, 2014, compared to $6.4 million in the three months ended July 31, 2013. The Company expensed approximately $75,000 and $101,000 of transaction costs related to the acquisitions in three months ended July 31, 2014 and 2013, respectively. The Company's acquisitions during the three months ended July 31, 2014 and 2013 are detailed below.

Three Months Ended July 31, 2014

		(in thousands)
		Total Acquisition Cost		Form of Consideration				Investment Allocation
Acquisitions	Date Acquired			Cash		Other(1)		Land		Building		Intangible Assets
Multi-Family Residential
152 unit – Homestead Garden - Rapid City, SD(2)	2014-06-02	$	15,000	$	5,092	$	9,908	$	655	$	14,139	$	206
52 unit – Silver Springs - Rapid City, SD	2014-06-02		3,280		1,019		2,261		215		3,006		59
			18,280		6,111		12,169		870		17,145		265
Unimproved Land
Creekside Crossing – Bismarck, ND	2014-05-22		4,269		4,269		0		4,269		0		0
PrairieCare Medical – Brooklyn Park, MN	2014-06-05		2,616		2,616		0		2,616		0		0
71 France Phase I – Edina, MN(3)	2014-06-12		1,413		0		1,413		1,413		0		0
			8,298		6,885		1,413		8,298		0		0
Total Property Acquisitions		$	26,578	$	12,996	$	13,582	$	9,168	$	17,145	$	265

(1) Consists of assumed debt (Homestead Garden I - $9.9 million, Silver Springs - $2.3 million) and value of land contributed by the joint venture partner (71 France - $1.4 million).

(2) At acquisition the Company adjusted the assumed debt to fair value and recognized approximately $852,000 of goodwill.

(3) Land is owned by a joint venture in which the Company currently has an approximately 55.3% interest. The joint venture is consolidated in IRET's financial statements.

Three Months Ended July 31, 2013

		(in thousands)
		Total Acquisition Cost		Form of Consideration				Investment Allocation
Acquisitions	Date Acquired			Cash		Units(1)		Land		Building		Intangible Assets
Multi-Family Residential
71 unit - Alps Park - Rapid City, SD	2013-05-01	$	6,200	$	2,920	$	3,280	$	287	$	5,551	$	362
Unimproved Land
Chateau II - Minot, ND	2013-05-21		179		179		0		179		0		0
Total Property Acquisitions		$	6,379	$	3,099	$	3,280	$	466	$	5,551	$	362

(1) Value of limited partnership units of the Operating Partnership at the acquisition date.

Acquisitions in the three months ended July 31, 2014 and 2013 are immaterial to our real estate portfolio both individually and in the aggregate, and consequently no proforma information is presented. The results of operations from acquired properties are included in the Condensed Consolidated Statements of Operations as of their acquisition date. The revenue and net income of our acquisitions in the three months ended July 31, 2014 and 2013, respectively, (excluding development projects placed in service) are detailed below.

	(in thousands)
	Three Months Ended July 31
	2014		2013
Total revenue	$	362	$	186
Net (loss) income	$	20	$	(108)

DEVELOPMENT PROJECTS PLACED IN SERVICE

IRET Properties placed approximately $10.3 million of development projects in service during the three months ended July 31, 2014. There were no development projects placed in service in the three months ended July 31, 2013. The development projects placed in service during the three months ended July 31, 2014 are detailed below.

Three Months Ended July 31, 2014

		(in thousands)
Development Projects Placed in Service (1)	Date Placed in Service	Land		Building		Development Cost
Multi-Family Residential
44 unit – Dakota Commons - Williston, ND(2)	2014-07-15		823		9,442		10,265
Total Development Projects Placed in Service		$	823	$	9,442	$	10,265

(1) Development projects that are placed in service in phases are excluded from this table until the entire project has been placed in service. See Note 6 for additional information on the Renaissance Heights I project, which was partially placed in service during the fiscal year 2014 and the three months ended July 31, 2014.

(2) Development property placed in service July 15, 2014. Costs paid in fiscal year 2014 totaled $8.1 million, including the land acquired in fiscal year 2013. Additional costs paid in fiscal year 2015 totaled $2.2 million, for a total project cost at July 31, 2014 of $10.3 million.

PROPERTY DISPOSITIONS

During the first quarter of fiscal year 2015, the Company sold one commercial office property and one commercial industrial property for a total sales price of $6.7 million. The Company also demolished a building at a commercial retail property in Weston, Wisconsin.

During the first quarter of fiscal year 2014, the Company sold four commercial industrial properties and one commercial retail property for a total sales price of $21.8 million. The following table details the Company's dispositions during the three months ended July 31, 2014 and 2013:

Three Months Ended July 31, 2014

		(in thousands)
Dispositions	Date Disposed	Sales Price		Book Value and Sales Cost		Gain/(Loss)
Commercial Office
73,338 sq ft Dewey Hill - Edina, MN	2014-05-19		3,100		3,124		(24)
Commercial Industrial
198,600 sq ft Eagan 2785 & 2795 – Eagan, MN	2014-07-15		3,600		5,393		(1,793)
Commercial Retail
25,644 sq ft Weston Retail – Weston, WI	2014-07-28		n/a		1,176		(1,176)
Total Property Dispositions		$	6,700	$	9,693	$	(2,993)

Three Months Ended July 31, 2013

		(in thousands)
Dispositions	Date Disposed	Sales Price		Book Value and Sales Cost		Gain/(Loss)
Commercial Industrial
41,880 sq ft Bodycote Industrial Building- Eden Prairie, MN	2013-05-13		3,150		1,375		1,775
42,244 sq ft Fargo 1320 45th Street N - Fargo, ND	2013-05-13		4,700		4,100		600
49,620 sq ft Metal Improvement Company - New Brighton, MN	2013-05-13		2,350		1,949		401
172,057 sq ft Roseville 2929 Long Lake Road - Roseville, MN	2013-05-13		9,275		9,998		(723)
			19,475		17,422		2,053
Commercial Retail
23,187 sq ft Eagan Community - Eagan, MN	2013-05-14		2,310		2,420		(110)
Total Property Dispositions		$	21,785	$	19,842	$	1,943