8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  June 29, 2015

INVESTORS REAL ESTATE TRUST

 (Exact name of Registrant as specified in its charter)

North Dakota	001-35624	45-0311232
(State or Other Jurisdiction of Incorporation or Organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

1400 31st Avenue SW, Suite 60

Post Office Box 1988

Minot, ND 58702-1988

 (Address of principal executive offices) (Zip code)

(701) 837-4738

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

Item 2.02. Results of Operations and Financial Condition.

and

Item 7.01. Regulation FD Disclosure.

An earnings release issued by the Company on June 29, 2015, regarding financial and operational results for the three and twelve months ended April 30, 2015, is attached as Exhibit 99.1, and certain supplemental information regarding the Company’s capital analysis, portfolio, tenant analysis and growth and strategy not included in the earnings release is attached as Exhibit 99.2.

This information pursuant to Item 7.01 and Item 2.02 of Form 8-K, including Exhibits 99.1 and 99.2, is being furnished. This information is not deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 and is not incorporated by reference into any Securities Act registration statements.

ITEM 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit Number	Description
99.1	Earnings Release issued June 29, 2015, regarding financial and operational results for the three and twelve months ended April 30, 2015
99.2	Supplemental information

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	INVESTORS REAL ESTATE TRUST
Date:  June 29, 2015	By:	/s/ Timothy P. Mihalick
		Timothy P. Mihalick
		President & Chief Executive Officer

EX-99.1

Exhibit 99.1

Earnings Release

INVESTORS REAL ESTATE TRUST

ANNOUNCES

FINANCIAL AND OPERATING RESULTS

FOR THE QUARTER AND FISCAL YEAR ENDED APRIL 30, 2015

Minot, ND – June 29, 2015 – Investors Real Estate Trust (NYSE: IRET) reportedfinancial and operating results today for the quarter and fiscal year ended April 30, 2015.

For the three month period ended April 30, 2015, as compared to the same period of the prior fiscal year:

· Revenues increased to $70.8 million from $67.8 million, an increase of 4.4%.

· Total expenses decreased by approximately $39.0 million, or (44.1)%, in the three months ended April 31, 2015 compared to the three months ended April 30, 2014, from $67.8 million to $49.5 million.

· FFO increased to $22.0 million on 137 million weighted average shares and units outstanding, from $17.6 million on 129 million weighted average shares and units outstanding ($.16 per share and unit compared to $.14 per share and unit).

· Net Income Available to Common Shareholders was $7.9 million compared to $31.4 million of Net Loss Available to Common Shareholders in the prior fiscal year.

For the fiscal year ended April 30, 2015, as compared to the prior fiscal year:

· Revenues increased to $283.2 million from $267.1 million, an increase of 6.0%.

· Total expenses decreased by $31.6 million, or 13.4%, in the twelve months ended April 30, 2015 compared to the twelve months ended April 30, 2014, from $236.2 million to $204.5 million.

· FFO increased to $86.6 million on 135 million weighted average shares and units outstanding, from $79.9 million on 127 million weighted average shares and units outstanding ($.64 per share and unit compared to $.63 per share and unit).

· Net Income Available to Common Shareholders was $12.6 million compared to $24.7 million of Net Loss Available to Common Shareholders in the prior fiscal year.

Significant Events and Transactions during the fourth quarter of fiscal year 2015:

· The acquisition of a 119-unit multi-family residential property in Bismarck, North Dakota, for a purchase price of $15.0 million.

· The disposition of nine office properties, one healthcare property, one retail property and one parcel of unimproved land for sales prices totaling $48.4 million.

· Diane K. Bryantt was promoted to Executive Vice President and Chief Operating Officer of the Company; Ted E. Holmes was promoted to Executive Vice President and Chief Financial Officer; and Mark W. Reiling was promoted to Executive Vice President and Chief Investment Officer.

· Pamela J. Moret was appointed as a Trustee of the Company’s Board of Trustees.

IRET’s President and Chief Executive Officer, Timothy Mihalick, commented, “IRET demonstrated another quarter of consistent performance with FFO and AFFO results meeting our expectations.  We continue making progress on our development pipeline with anticipation of placing into service all current projects in the first, second, and third quarters of fiscal year 2016, with the exception of the third phase of the 71 France project, which will be completed in the first quarter of fiscal year 2017.  We are also aggressively moving ahead with the announced disposition of our office and retail portfolios and will soon be able to provide our investors with meaningful data points to illustrate the significance and benefit of these sales for the Company.  Our operating results continue to benefit from the continued lease up of our developments and we are pleased with recent trends in our same-store results, all of which continue to support our goal of providing our shareholders with a predictable cash flow to support a strong overall return.  We do believe investors have had concerns about our participation in real estate investments in markets which are affected by energy production in our Region of the country.  I want to assure our investors, we are mindful not to expose the Company to any one segment of the economy and we feel very comfortable with our real estate holdings with the true exposure to energy-related industries not material to the scope of the Company.  We continue executing our plan to rebalance the portfolio which will better predict results for our shareholders. This is an exciting time for IRET.”

¹ The National Association of Real Estate Investment Trusts, Inc. (NAREIT) defines FFO as “net income (computed in accordance with generally accepted accounting principles), excluding gains (or losses) from sales of property, plus real estate depreciation and amortization, and adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis.”  In addition, in October 2011 NAREIT clarified its computation of FFO to exclude impairment charges for all periods presented. FFO is a non-GAAP measure. We consider FFO, which is a standard supplemental measure for equity real estate investment trusts, helpful to investors because it facilitates an understanding of the operating performance of properties without giving effect to impairment write-downs and to real estate depreciation and amortization, which assumes that the value of real estate assets diminishes predictably over time.  Since real estate values instead historically rise or fall with market conditions, we believe that FFO provides investors and management with a more accurate indication of our financial and operating results. See table below for a reconciliation of Net Income to FFO.

i

Operating Results

Net Operating Income (NOI)² from all properties increased by $4.6 million, or 12.4%, during the three-month period ended April 30, 2015, compared to the same period one year ago. Non-same-store properties, primarily our new multi-family residential developments, provided for an increase of $2.1 million, while same-store NOI provided for $2.5 million.

NOI from all properties increased by $9.2 million, or 5.8%, during the fiscal year ended April 30, 2015, compared to the same period one year ago.  Non-same-store properties, primarily our new multi-family residential developments, provided for a $7.2 million increase, while same-store NOI provided for $2.0 million. Same-store real estate revenue increased by $2.5 million, outpacing the increase in same-store real estate expenses of $415,000.

Same-store occupancy as of April 30, 2015 compared to April 30, 2014 increased in our multi-family residential and office segments, decreased in our healthcare and retail segments and remained stable in our industrial segment. The 4.9% decrease in occupancy in our retail segment on a same-store basis was due to the expiration and nonrenewal of a lease for 37,849 square feet at Grand Forks MedPark Mall and the early termination of a lease for 22,394 square feet at St. Cloud Westgate. Occupancy represents the actual number of units or square footage leased divided by the total number of units or square footage at the end of the period.

Occupancy Levels on a Same-Store Property and All Property Basis:

	Same-Store Properties(a)						All Properties
	As of April 30,						As of April 30,
Segments	Fiscal 2015			Fiscal 2014			Fiscal 2015			Fiscal 2014
Multi-Family Residential		94.7	%		93.4	%		92.0	%		93.0	%
Office		84.8	%		84.0	%		83.2	%		80.7	%
Healthcare		95.7	%		96.2	%		95.8	%		96.3	%
Industrial		100.0	%		100.0	%		83.4	%		87.8	%
Retail		83.3	%		88.2	%		83.4	%		87.4	%

(a)	Non-same-store properties consist of the following properties (re-development and in-service development properties are listed in bold type):
	Multi-Family Residential -	Arcata, Golden Valley, MN; Colonial Villa, Burnsville, MN; Commons at Southgate, Minot, ND; Cypress Court I and II, St. Cloud, MN;  Dakota Commons, Williston, ND; Homestead Garden, Rapid City, SD; Landing at Southgate, Minot, ND; Legacy Heights, Bismarck, ND; Northridge, Bismarck, ND; Pinecone Villas, Sartell, MN;  Red 20, Minneapolis, MN; Renaissance Heights, Williston, ND;River Ridge, Bismarck, ND; Silver Springs, Rapid City, SD and Southpoint, Grand Forks, ND. Total number of units, 1,949.
	Healthcare -	Spring Creek Fruitland, Fruitland, ID. Total rentable square footage, 39,500.
	Industrial -	Roseville 3075 Long Lake Road, Roseville, MN. Total rentable square footage, 220,557.
	Retail -	Minot Southgate Wells Fargo Bank, Minot, ND. Total rentable square footage, 4,998.

Held for Sale -	Office -	Thresher Square, Minneapolis, MN. Total rentable square footage, 117,144.
	Healthcare -	Nebraska Orthopaedic Hospital, Omaha, NE. Total rentable square footage, 61,758.
	Total NOI for held for sale properties for the twelve months ended April 30, 2015 and 2014, respectively, $1,945 and $1,931.

Sold -	Multi-Family Residential -	Lancaster, St. Cloud, MN.
	Office -	2030 Cliff Road, Eagan, MN; Burnsville Bluffs II, Burnsville, MN; Dewey Hill Business Center, Edina, MN; Northgate I, Maple Grove, MN; Northgate II, Maple Grove, MN; Plymouth I, Plymouth, MN; Plymouth II, Plymouth, MN; Plymouth III, Plymouth, MN; Plymouth IV-V, Plymouth, MN; Southeast Tech, Eagan, MN; Whitewater Plaza, Minnetonka, MN and Wirth Corporate Center, Golden Valley, MN.
	Healthcare -	Jamestown Medical Office Building, Jamestown, ND.
	Industrial -	Eagan 2785 & 2795 Hwy 55, Eagan, MN.
	Retail -	Fargo Express Community, Fargo, ND; Kalispell Retail Center, Kalispell, MT and Weston Retail and Walgreens , Weston, WI.
	Total NOI for sold properties for the twelve months ended April 30, 2015 and 2014, respectively, $3,724 and $3,904.

² We measure the performance of our segments based on NOI, which we define as total real estate revenues and gain on involuntary conversion less real estate expenses (which consist of utilities, maintenance, real estate taxes, insurance, property management expenses and other property expenses). We believe that NOI is an important supplemental measure of operating performance for a real estate investment trust’s operating real estate because it provides a measure of core operations that is unaffected by depreciation, amortization, financing and general and administrative expense. NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income, net income available for common shareholders or cash flow from operating activities as a measure of financial performance. See tables below for a reconciliation of NOI to the condensed consolidated financial statements.

³ Same-store properties are properties owned or in service for the entirety of the periods being compared (except for properties for which significant redevelopment or expansion occurred during either of the periods being compared, and properties sold or classified as held for sale), and, in the case of development or re-development properties, which have achieved a target level of occupancy of 90% for multi-family residential properties and 85% for office, healthcare, industrial and retail properties.

ii

Acquisitions and Dispositions

During the fourth quarter of fiscal year 2015, the Company closed on its acquisition of a 119-unit multi-family residential property in Bismarck, North Dakota, for a purchase price of $15.0 million.

Also during the fourth quarter of fiscal year 2015, the Company sold nine office properties, one healthcare property, one retail property and one parcel of unimproved land for sales prices totaling $48.4 million.

Strategic Dispositions

At April 30, 2015, the Company had one office property and one healthcare property classified as held for sale. In January 2015, the Company announced that it is exploring a calendar year 2015 disposition of substantially all of its commercial office and retail properties, in an update to its current strategic plan, under which the Company has been directing new investments primarily toward multifamily residential and healthcare properties. The Company intends to use the proceeds from dispositions to continue portfolio deleveraging and for developing and acquiring high-quality assets in the Company’s multi-family, industrial and healthcare segments. Subsequent to the end of fiscal year 2015, the Company signed an agreement to sell 34 office properties located in 8 states for a sale price of $250.0 million and a joint venture in which the Company has a 51% interest signed an agreement to sell five office properties in Mendota Heights, Minnesota, for a sale price of $40.0 million. These pending dispositions are subject to various closing conditions and contingencies, and no assurances can be given that the transaction will be completed on the terms currently expected, or at all.

Mortgages Payable

The Company’s mortgages payable include a non-recourse $122.6 million CMBS loan, for which nine of the Company’s office properties serve as collateral and under which a special-purpose subsidiary of the Company is the borrower. This loan matures in October 2016. Because the loan amount significantly exceeds the Company’s current estimate of the fair value of this nine-property portfolio, the Company contacted the master servicer to initiate discussions on various alternatives with regard to the loan. During the first quarter of fiscal year 2015, the Company was notified that the loan has been transferred to the special servicer. On April 14, 2015, the Company received a letter from the special servicer advising that the loan was in default due to a nonpayment on April 6, 2015. The Company cannot predict the outcome of discussions with the special servicer regarding the loan.

Shareholder Equity, Distributions and Capital Structure

As of April 30, 2015, IRET had a total capitalization of $2.5 billion. Total capitalization is defined as the market value (closing price at end of period) of the Company’s outstanding common shares and the imputed market value of the outstanding limited partnership units of IRET Properties (which are convertible, at the expiration of a specified holding period, into cash or, at the Company’s sole discretion, into common shares of the Company on a one-to-one basis), plus the book value of the Company’s preferred shares and the outstanding principal balance of the consolidated debt of the Company.

On April 1, 2015, IRET paid a quarterly distribution of $0.1300 per share and unit on its common shares and limited partnership units of IRET Properties. This was IRET’s 176^th consecutive distribution. IRET also paid, on March 31, 2015, a quarterly distribution of $0.5156 per share on its Series A preferred shares and a quarterly distribution of $0.4968 per share on its Series B preferred shares.

Distribution Declared.  Subsequent to the end of the fourth quarter of fiscal year 2015, on June 2, 2015, the Company’s Board of Trustees declared a regular quarterly distribution of $0.1300 per share and unit on the Company’s common shares of beneficial interest and the limited partnership units of IRET Properties, payable July 1, 2015 to common shareholders and unitholders of record on June 15, 2015. Also on June 2, 2015, the Company’s Board of Trustees’ declared a distribution of $0.5156 per share on the Company’s Series A preferred shares of beneficial interest, payable June 30, 2015 to Series A preferred shareholders of record on June 15, 2015, and declared a distribution of $0.4968 per share on the Company’s Series B preferred shares of beneficial interest, payable June 30, 2015 to Series B preferred shareholders of record on June 15, 2015.

iii

Conference Call Information

The Conference Call for 4th Quarter Earnings is scheduled for Tuesday, June 30, 2015 at 9:00 A.M. Central Time.  The call will be limited to one hour, including questions and answers.  Conference call access information is as follows:

USA Toll Free Number: 1-877-509-9785

International Toll Free Number: 1-412-902-4132

Canada Toll Free Number: 1-855-669-9657

A webcast and transcript of the call will be archived on the “Investor Info/ Presentations & Events/Presentations” page of IRET’s website, http://www.iret.com, for one year.  Questions regarding the conference call should be directed to cbradehoft@iret.com.

About IRET

IRET is a self-administered, equity real estate investment trust investing in income-producing properties located primarily in the upper Midwest. IRET owns a diversified portfolio of properties consisting of 100 multi-family residential properties with 11,844 apartment units; and 53 office properties, 66 healthcare properties (including senior housing), 7 industrial properties and 23 retail properties with a total of approximately 9.6 million square feet of leasable space.  IRET common shares, Series A preferred shares and Series B preferred shares are publicly traded on the New York Stock Exchange (NYSE symbols: IRET, IRETPR and IRETPRB, respectively). IRET’s press releases and supplemental information are available on the Company website at www.iret.com or by contacting Investor Relations at 701-837-4738.

Certain statements in this earnings release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from projected results. Such risks, uncertainties and other factors include, but are not limited to: intentions and expectations regarding future distributions on our common shares and units, fluctuations in interest rates, the effect of government regulation, the availability of capital, changes in general and local economic and real estate market conditions, competition, our ability to attract and retain skilled personnel, and those risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission, including our 2015 Form 10-K.  We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

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INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

	(in thousands, except share data)
	April 30, 2015			April 30, 2014
ASSETS
Real estate investments
Property owned	$	2,098,037		$	1,996,031
Less accumulated depreciation		(448,987	)		(424,288	)
		1,649,050			1,571,743
Development in progress		153,994			104,609
Unimproved land		25,827			22,864
Total real estate investments		1,828,871			1,699,216
Real estate held for sale		22,912			2,951
Cash and cash equivalents		48,970			47,267
Other investments		329			329
Receivable arising from straight-lining of rents, net of allowance of $718 and $796, respectively		26,211			27,096
Accounts receivable, net of allowance of $438 and $248, respectively		3,675			10,206
Real estate deposits		2,489			145
Prepaid and other assets		3,907			4,639
Intangible assets, net of accumulated amortization of $26,576 and $24,071, respectively		27,267			32,639
Tax, insurance, and other escrow		11,249			20,880
Property and equipment, net of accumulated depreciation of $1,464 and $2,041, respectively		1,542			1,681
Goodwill		1,911			1,100
Deferred charges and leasing costs, net of accumulated amortization of $21,340 and $21,068, respectively		18,504			21,072
TOTAL ASSETS	$	1,997,837		$	1,869,221
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
LIABILITIES
Accounts payable and accrued expenses	$	71,072		$	59,105
Revolving line of credit		60,500			22,500
Mortgages payable		974,828			997,689
Construction debt and other		144,115			63,178
TOTAL LIABILITIES		1,250,515			1,142,472
COMMITMENTS AND CONTINGENCIES
REDEEMABLE NONCONTROLLING INTERESTS – CONSOLIDATED REAL ESTATE ENTITIES		6,368			6,203
EQUITY
Investors Real Estate Trust shareholders’ equity
Series A Preferred Shares of Beneficial Interest (Cumulative redeemable preferred shares, no par value, 1,150,000 shares issued and outstanding at April 30, 2015 and April 30, 2014, aggregate liquidation preference of $28,750,000)		27,317			27,317
Series B Preferred Shares of Beneficial Interest (Cumulative redeemable preferred shares, no par value, 4,600,000 shares issued and outstanding at April 30, 2015 and April 30, 2014, aggregate liquidation preference of $115,000,000)		111,357			111,357
Common Shares of Beneficial Interest (Unlimited authorization, no par value, 124,455,624 shares issued and outstanding at April 30, 2015, and 109,019,341 shares issued and outstanding at April 30, 2014)		951,868			843,268
Accumulated distributions in excess of net income		(438,432	)		(389,758	)
Total Investors Real Estate Trust shareholders’ equity		652,110			592,184
Noncontrolling interests – Operating Partnership (13,999,725 units at April 30, 2015 and 21,093,445 units at April 30, 2014)		58,325			105,724
Noncontrolling interests – consolidated real estate entities		30,519			22,638
Total equity		740,954			720,546
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY	$	1,997,837		$	1,869,221

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INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(unaudited)

for the three and twelve months ended April 30, 2015 and 2014

	(in thousands, except per share data)
	Three Months Ended April 30						Twelve Months Ended April 30
	2015			2014			2015			2014
REVENUE
Real estate rentals	$	59,451		$	55,665		$	235,852		$	219,921
Tenant reimbursement		10,387			11,318			43,818			45,561
TRS senior housing revenue		921			823			3,520			1,627
TOTAL REVENUE		70,759			67,806			283,190			267,109
EXPENSES
Depreciation/amortization related to real estate investments		17,266			16,436			67,112			67,592
Utilities		5,740			6,691			20,881			21,864
Maintenance		7,533			8,439			30,924			31,158
Real estate taxes		8,362			8,567			33,945			32,982
Insurance		1,279			1,261			5,839			5,165
Property management expenses		4,771			4,578			18,502			16,961
Other property expenses		123			53			906			357
TRS senior housing expenses		754			660			2,997			1,331
Administrative expenses		2,516			2,801			11,824			10,743
Other expenses		332			502			2,010			2,132
Amortization related to non-real estate investments		867			826			3,495			3,326
Impairment of real estate investments		0			37,768			6,105			42,566
TOTAL EXPENSES		49,543			88,582			204,540			236,177
Gain on involuntary conversion		0			0			0			2,480
Operating income		21,216			(20,776	)		78,650			33,412
Interest expense		(15,162	)		(14,617	)		(59,020	)		(59,142	)
Interest income		557			562			2,238			1,908
Other income		347			360			723			483
Income (loss) before gain (loss) on sale of real estate and other investments and income from discontinued operations		6,958			(34,471	)		22,591			(23,339	)
Gain (loss) on sale of real estate and other investments		6,904			(51	)		6,093			(51	)
Income (loss) from continuing operations		13,862			(34,522	)		28,684			(23,390	)
Income from discontinued operations		0			0			0			6,450
NET INCOME (LOSS)		13,862			(34,522	)		28,684			(16,940	)
Net (income) loss attributable to noncontrolling interests – Operating Partnership		(908	)		6,082			(1,526	)		4,676
Net income attributable to noncontrolling interests – consolidated real estate entities		(2,201	)		(102	)		(3,071	)		(910	)
Net income (loss) attributable to Investors Real Estate Trust		10,753			(28,542	)		24,087			(13,174	)
Dividends to preferred shareholders		(2,878	)		(2,878	)		(11,514	)		(11,514	)
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	7,875		$	(31,420	)	$	12,573		$	(24,688	)
Earnings (loss) per common share from continuing operations – Investors Real Estate Trust – basic and diluted	$	.07		$	(.29	)	$	.11		$	(.28	)
Earnings per common share from discontinued operations – Investors Real Estate Trust – basic and diluted		.00			.00			.00			.05
NET INCOME (LOSS) PER COMMON SHARE – BASIC & DILUTED	$	.07		$	(.29	)	$	.11		$	(.23	)
DIVIDENDS PER COMMON SHARE	$	.1300		$	.1300		$	.5200		$	.5200

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INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

RECONCILIATION OF NET INCOME ATTRIBUTABLE TO

INVESTORS REAL ESTATE TRUST TO FUNDS FROM OPERATIONS

for the three and twelve months ended April 30, 2015 and 2014

	(in thousands, except per share amounts)
Three Months Ended April 30,	2015							2014
	Amount			Weighted Avg Shares and Units(2)		Per Share And Unit(3)		Amount			Weighted Avg Shares and Units(2)		Per Share And Unit(3)
Net income attributable to Investors Real Estate Trust	$	10,753						$	(28,542	)
Less dividends to preferred shareholders		(2,878	)						(2,878	)
Net income available to common shareholders		7,875			123,286	$	0.07		(31,420	)		107,992	$	(0.29	)
Adjustments:
Noncontrolling interest – Operating Partnership		908			14,126				(6,082	)		21,252
Depreciation and amortization(1)		18,083							17,239
Impairment of real estate investments		0							37,768
Gain on depreciable property sales attributable to Investors Real Estate Trust		(4,890	)						51
Funds from operations applicable to common shares and Units	$	21,976			137,412	$	0.16	$	17,556			129,244	$	0.14

	(in thousands, except per share amounts)
Twelve Months Ended April 30,	2015							2014
	Amount			Weighted Avg Shares and Units(2)		Per Share And Unit(3)		Amount			Weighted Avg Shares and Units(2)		Per Share And Unit(3)
Net income (loss) attributable to Investors Real Estate Trust	$	24,087						$	(13,174	)
Less dividends to preferred shareholders		(11,514	)						(11,514	)
Net income (loss) available to common shareholders		12,573			118,004	$	0.11		(24,688	)		105,331	$	(0.23	)
Adjustments:
Noncontrolling interest – Operating Partnership		1,526			16,594				(4,676	)		21,697
Depreciation and amortization(4)		70,450							71,830
Impairment of real estate investments		6,105							44,426
Gain on depreciable property sales attributable to Investors Real Estate Trust		(4,079	)						(6,948	)
Funds from operations applicable to common shares and Units	$	86,575			134,598	$	0.64	$	79,944			127,028	$	0.63

(1) Real estate depreciation and amortization consists of the sum of depreciation/amortization related to real estate investments and amortization related to non-real estate investments from the Consolidated Statements of Operations, totaling $18,133 and $17,262, less corporate-related depreciation and amortization on office equipment and other assets of $50 and $23, for the three months ended April 30, 2015 and 2014, respectively.

(2) UPREIT Units of the Operating Partnership are exchangeable for cash, or, at the Company’s discretion, for common shares of beneficial interest on a one-for-one basis.

(3) Net income attributable to Investors Real Estate Trust is calculated on a per share basis. FFO is calculated on a per share and unit basis.

(4) Real estate depreciation and amortization consists of the sum of depreciation/amortization related to real estate investments and amortization related to non-real estate investments from the Condensed Consolidated Statements of Operations, totaling $70,607 and 70,918, and depreciation/amortization from Discontinued Operations of $0 and $1,010, less corporate-related depreciation and amortization on office equipment and other assets of $157 and $98 for the twelve months ended April 30, 2015 and 2014, respectively.

vii

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

RECONCILATION OF NET OPERATING INCOME TO THE

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

for the three and twelve months ended April 30, 2015 and 2014

	(in thousands)
Three Months Ended April 30, 2015	Multi-Family Residential		Office		Healthcare		Industrial		Retail		Total
Real estate revenue	$	30,949	$	18,062	$	15,909	$	1,586	$	3,332	$	69,838
Real estate expenses		13,469		8,618		4,271		316		1,134		27,808
Net operating income	$	17,480	$	9,444	$	11,638	$	1,270	$	2,198		42,030
TRS senior housing revenue												921
TRS senior housing expenses												(754	)
Depreciation/amortization												(18,133	)
Administrative expenses												(2,516	)
Other expenses												(332	)
Interest expense												(15,162	)
Interest and other income												904
Income before gain on sale of real estate and other investments												6,958
Gain on sale of real estate and other investments												6,904
Net income											$	13,862

	(in thousands)
Three Months Ended April 30, 2014	Multi-Family Residential		Office		Healthcare		Industrial		Retail		Total
Real estate revenue	$	26,400	$	19,365	$	15,917	$	1,622	$	3,679	$	66,983
Real estate expenses		13,133		9,876		4,595		594		1,391		29,589
Net operating income	$	13,267	$	9,489	$	11,322	$	1,028	$	2,288		37,394
TRS senior housing revenue												823
TRS senior housing expenses												(660	)
Depreciation/amortization												(17,262	)
Administrative expenses												(2,801	)
Other expenses												(502	)
Impairment of real estate investments												(37,768	)
Interest expense												(14,617	)
Interest and other income												922
Loss before loss on sale of real estate and other investments												(34,471	)
Loss on sale of real estate and other investments												(51	)
Net loss											$	(34,522	)

viii

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

RECONCILATION OF NET OPERATING INCOME TO THE

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

for the three and twelve months ended April 30, 2015 and 2014 (continued)

	(in thousands)
12 Months Ended April 30, 2015	Multi-Family Residential		Office		Healthcare		Industrial		Retail		Total
Real estate revenue	$	118,526	$	74,978	$	66,230	$	6,491	$	13,445	$	279,670
Real estate expenses		51,172		36,491		17,176		1,536		4,622		110,997
Net operating income	$	67,354	$	38,487	$	49,054	$	4,955	$	8,823		168,673
TRS senior housing revenue												3,520
TRS senior housing expenses												(2,997	)
Depreciation/amortization												(70,607	)
Administrative expenses												(11,824	)
Other expenses												(2,010	)
Impairment of real estate investments												(6,105	)
Interest expense												(59,020	)
Interest and other income												2,961
Income before gain on sale of real estate and other investments												22,591
Gain on sale of real estate and other investments												6,093
Net income											$	28,684

	(in thousands)
12 Months Ended April 30, 2014	Multi-Family Residential		Office		Healthcare		Industrial		Retail		Total
Real estate revenue	$	102,059	$	77,440	$	65,258	$	6,894	$	13,831	$	265,482
Real estate expenses		46,138		38,190		17,127		2,043		4,989		108,487
Gain on involuntary conversion		2,480		0		0		0		0		2,480
Net operating income	$	58,401	$	39,250	$	48,131	$	4,851	$	8,842		159,475
TRS senior housing revenue												1,627
TRS senior housing expenses												(1,331	)
Depreciation/amortization												(70,918	)
Administrative expenses												(10,743	)
Other expenses												(2,132	)
Impairment of real estate investments												(42,566	)
Interest expense												(59,142	)
Interest and other income												2,391
Loss before loss on sale of real estate and other investments and income from discontinued operations												(23,339	)
Loss on sale of real estate and other investments												(51	)
Loss from continuing operations												(23,390	)
Income from discontinued operations												6,450
Net loss											$	(16,940	)

ix

EX-99.2

Exhibit 99.2

Fourth Quarter Fiscal 2015

Supplemental Operating and Financial Data

for the Quarter Ended April 30, 2015

CONTACT:	1400 31st Avenue SW, Suite 60
Cindy Bradehoft	Minot, ND 58701
Director of Investor Relations	Tel: 701.837.4738
Direct Dial: 952-401-4835	Fax: 701.838.7785
E-Mail: cbradehoft@iret.com	www.iret.com

Supplemental Financial and Operating Data

Table of Contents

April 30, 2015

	Page
Company Background and Highlights	2
Property Cost by Segment and by State	5
Key Financial Data
Condensed Consolidated Balance Sheets	6
Condensed Consolidated Statements of Operations	7
Funds From Operations	8
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA)	9
Capital Analysis
Long-Term Mortgage Debt Analysis	10
Long-Term Mortgage Debt Detail	11-13
Capital Analysis	14
Portfolio Analysis
Same-Store Properties Net Operating Income Summary	15
Net Operating Income Detail	16-19
Same-Store Properties and All Properties Occupancy Levels by Segment	20
Tenant Analysis
Multi-Family Residential Summary	21
Commercial Leasing Summary	22-25
10 Largest Commercial Tenants - Based on Annualized Base Rent	26
Commercial Lease Expirations	27
Growth and Strategy
Acquisition Summary	28
Development Placed in Service Summary	29
Development in Progress Summary	30
Acquisitions and Development Liquidity Profile	31
Definitions	32

1

Company Background and Highlights

Fourth Quarter Fiscal 2015

Investors Real Estate Trust is a self-administered, equity real estate investment trust (REIT) investing in a portfolio of income-producing properties located primarily in the upper Midwest.  IRET’s portfolio is diversified among multi-family residential; office; healthcare, including senior housing; industrial and retail segments.

During the fourth quarter of fiscal year 2015, the Company closed on its acquisition of a 119-unit multi-family residential property in Bismarck, North Dakota, for a purchase price of $15.0 million.

Also during the fourth quarter of fiscal year 2015, the Company sold nine office properties, one healthcare property, one retail property and one parcel of unimproved land for sales prices totaling $48.4 million.

The Company experienced improving trends in a majority of its apartment investments in fiscal year 2015.  Same-store revenues for the portfolio outpaced same-store expenses and occupancy reached our target 95% at fiscal year end on same store-assets. Same-store revenues in the segment increased 3.4% over the prior fiscal year primarily driven by an increase in scheduled rent in all of our markets ranging from a 0.4% increase in Topeka, KS to 5.4% in Bismarck, ND.  Demand was also strong for the 798 apartment units the Company placed in service during fiscal year 2015. However, the Company’s ability to maintain occupancy levels and raise rents remains dependent on continued healthy employment and wage growth. The Company has continued to observe considerable multi-family development activity in the Company’s markets, and as this new construction is completed and leased, the Company will experience increased competition for residents. However, based on information available to the Company, apartment developers in our markets are currently seeing increases in construction costs for potential new apartment developments, which may slow new developments in our markets.  The U.S. economic outlook through 2017 is forecasted to be good according to U.S. Bureau of Labor Statistics and Moody’s Analytics.  Businesses are adding jobs and for the first time in this phase of the economic cycle we are seeing meaningful wage growth.  There is an attitudinal shift also occurring toward renting by professional millennials and to lesser, although growing degree, by baby boomers.  These trends are beneficial to apartment owners.

The Company’s office segment, mostly concentrated in Minnesota, continued to be affected by a number of adverse macro conditions. Demand for office space is mixed, with space absorption in the Minneapolis market in particular concentrated in prime locations, and suburban office properties continuing to lag in terms of occupancy. Businesses appear to be maintaining their goal of increasing the density of their work spaces by placing more employees in less total square footage.  The demand is strongest for modern office buildings which are in short supply due the lack of new construction of this class of building.  The Company’s office buildings are mostly class B, which class has the greatest supply and only modest and selective demand. As a result, we have been unable to effectively compete for the limited number of tenant prospects in the market.  The Company continues to expect a slow and uneven recovery in its office segment.  Additionally, there is a movement by tenants to the urban cores to attract and retain the best workers. Most of IRET’s office portfolio is suburban.

The Company’s healthcare segment consists of medical office properties and senior housing facilities. The medical office sector remains stable with high occupancy and modest rent increases.  The Company’s senior housing assets continue to benefit from the strengthening recovery in the housing market, as occupancy trends are closely aligned with the ability of seniors to sell their homes in anticipation of moving to a senior care facility.

Both the industrial and retail property markets continue to improve. The Company’s industrial properties are located primarily in the Minneapolis market, and all of these Minneapolis properties are 83.4% leased. The demand for bulk warehouse and manufacturing space in the Company’s markets is healthy, with rents generally rising.  The retail recovery is evident in regard to the Company’s Minneapolis-metro and grocery-anchored retail properties, which are performing well.  Locations outside the Minneapolis-metro area experience less demand, although improving.  There is little new construction in our markets, which bodes well going forward.

The Company is in process of selling substantially all of its commercial office and retail properties.  In an update to its strategic plan previously announced, the Company is narrowing its property focus.  Sale proceeds are intended to be used toward portfolio deleveraging and investments in multi-family residential and healthcare.

In the fourth quarter of fiscal year 2015, IRET paid its 176th consecutive quarterly distribution. The $0.1300 per share/unit distribution was payable on April 1, 2015. Subsequent to the end of the fourth quarter of fiscal year 2015, on June 2, 2015, the Company’s Board of Trustees declared a regular quarterly distribution of $0.1300 per share and unit on the Company’s common shares of beneficial interest and the limited partnership units of IRET Properties, payable July 1, 2015 to common shareholders and unitholders of record on June 15, 2015. Also on June 2, 2015, the Company’s Board of Trustees’ declared a distribution of $0.5156 per share on the Company’s Series A preferred shares of beneficial interest, payable June 30, 2015 to Series A preferred shareholders of record on June 15, 2015, and declared a distribution of $0.4968 per share on the Company’s Series B preferred shares of beneficial interest, payable June 30, 2015 to Series B preferred shareholders of record on June 15, 2015.

As of April 30, 2015, IRET owns a diversified portfolio of 249 properties consisting of 100 multi-family residential properties, 53 office properties, 66 healthcare properties (including senior housing), 7 industrial properties and 23 retail properties.  IRET’s common shares are publicly traded on the New York Stock Exchange (NYSE: IRET).

2

Company Snapshot

(as of April 30, 2015)

Company Headquarters	Minot, North Dakota
Fiscal Year-End	April 30
Reportable Segments	Multi-Family Residential, Office, Healthcare, Industrial, Retail
Total Properties	249
Total Square Feet (commercial properties)	9.6 million
Total Units (multi-family residential properties)	11,844
Common Shares Outstanding (thousands)	124,456
Limited Partnership Units Outstanding (thousands)	14,000
Common Share Distribution - Quarter/Annualized	$0.13/$0.52
Dividend Yield	7.3%
Total Capitalization (see p.14 for detail)	$2.5 billion

Investor Information

(as of June 29, 2015)

Board of Trustees

Jeffrey L. Miller	Trustee and Chairman
John D. Stewart	Trustee, Vice Chairman, and Chair of Nominating and Governance Committee
Jeffrey K. Woodbury	Trustee, Chair of Audit Committee
Linda J. Hall	Trustee, Chair of Compensation Committee
Jeffrey P. Caira	Trustee
Terrance P. Maxwell	Trustee
Pamela J. Moret	Trustee
Stephen L. Stenehjem	Trustee
Timothy P. Mihalick	Trustee, President and Chief Executive Officer

Management

Timothy P. Mihalick	President and Chief Executive Officer; Trustee
Diane K. Bryantt	Executive Vice President and Chief Operating Officer
Ted E. Holmes	Executive Vice President and Chief Financial Officer
Michael A. Bosh	Executive Vice President, General Counsel and Assistant Secretary
Mark Reiling	Executive Vice President and Chief Investment Officer
Charles A. Greenberg	Senior Vice President, Commercial Asset Management
Andrew Martin	Senior Vice President, Residential Property Management

Corporate Headquarters:

1400 31^st Avenue SW, Suite 60

Post Office Box 1988

Minot, North Dakota 58702-1988

Trading Symbol:  IRET

Stock Exchange Listing:  NYSE

Investor Relations Contact:

Cindy Bradehoft

cbradehoft@iret.com

3

Common Share Data (NYSE: IRET)

	4th Quarter Fiscal Year 2015			3rd Quarter Fiscal Year 2015			2nd Quarter Fiscal Year 2015			1st Quarter Fiscal Year 2015			4th Quarter Fiscal Year 2014
High Closing Price	$	8.31		$	8.60		$	8.59		$	9.21		$	9.06
Low Closing Price	$	7.09		$	8.05		$	7.49		$	8.52		$	8.34
Average Closing Price	$	7.52		$	8.35		$	8.11		$	8.82		$	8.71
Closing Price at end of quarter	$	7.17		$	8.25		$	8.40		$	8.52		$	8.72
Common Share Distributions—annualized	$	0.520		$	0.520		$	0.520		$	0.520		$	0.520
Closing Dividend Yield - annualized		7.3	%		6.3	%		6.2	%		6.1	%		6.0	%
Closing common shares outstanding (thousands)		124,456			122,134			119,809			114,763			109,019
Closing limited partnership units outstanding (thousands)		14,000			14,398			14,731			17,975			21,094
Closing market value of outstanding common shares, plus imputed closing market value of outstanding limited partnership units (thousands)	$	992,729		$	1,126,389		$	1,130,136		$	1,130,928		$	1,134,585

Certain statements in these supplemental disclosures are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from projected results. Such risks, uncertainties and other factors include, but are not limited to: intentions and expectations regarding future distributions on our common shares and units, fluctuations in interest rates, the effect of government regulation, the availability of capital, changes in general and local economic and real estate market conditions, competition, our ability to attract and retain skilled personnel, and those risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission, including our 2015 Form 10-K. We assume no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

Fourth Quarter Fiscal 2015 Acquisition

Legacy Heights (exterior) Bismarck, ND	Legacy Heights (interior) Bismarck, ND

4

Fourth Quarter Fiscal 2015

 

Property Cost by Segment

Percentage of Total Property Cost by State

5

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(in thousands)

	4/30/2015			1/31/2015			10/31/2014			7/31/2014			4/30/2014
ASSETS
Real estate investments
Property owned	$	2,098,037		$	2,093,148		$	2,013,770		$	2,025,327		$	1,996,031
Less accumulated depreciation		(448,987	)		(439,153	)		(426,545	)		(435,317	)		(424,288	)
		1,649,050			1,653,995			1,587,225			1,590,010			1,571,743
Development in progress		153,994			114,005			146,390			131,862			104,609
Unimproved land		25,827			27,675			24,947			24,772			22,864
Total real estate investments		1,828,871			1,795,675			1,758,562			1,746,644			1,699,216
Real estate held for sale		22,912			44,259			41,183			6,508			2,951
Cash and cash equivalents		48,970			52,148			52,999			60,620			47,267
Other investments		329			329			329			329			329
Receivable arising from straight-lining of rents, net of allowance		26,211			27,169			27,425			27,286			27,096
Accounts receivable, net of allowance		3,675			5,574			3,719			7,013			10,206
Real estate deposits		2,489			7,494			4,924			3,741			145
Prepaid and other assets		3,907			5,580			2,263			3,428			4,639
Intangible assets, net of accumulated amortization		27,267			28,475			29,745			31,478			32,639
Tax, insurance, and other escrow		11,249			11,277			16,338			20,451			20,880
Property and equipment, net of accumulated depreciation		1,542			1,619			1,598			1,641			1,681
Goodwill		1,911			1,940			1,940			1,951			1,100
Deferred charges and leasing costs, net of accumulated amortization		18,504			19,803			20,445			20,677			21,072
TOTAL ASSETS	$	1,997,837		$	2,001,342		$	1,961,470		$	1,931,767		$	1,869,221
LIABILITIES AND EQUITY
LIABILITIES
Accounts payable and accrued expenses	$	71,072		$	69,901		$	67,037		$	62,517		$	59,105
Revolving line of credit		60,500			50,500			40,500			35,500			22,500
Mortgages payable		974,828			1,006,179			1,013,161			1,017,574			997,689
Construction debt and other		144,115			132,210			107,731			83,666			63,178
TOTAL LIABILITIES		1,250,515			1,258,790			1,228,429			1,199,257			1,142,472
REDEEMABLE NONCONTROLLING INTERESTS – CONSOLIDATED REAL ESTATE ENTITIES		6,368			6,340			6,373			6,313			6,203
EQUITY
Investors Real Estate Trust shareholders’ equity
Series A Preferred Shares of Beneficial Interest		27,317			27,317			27,317			27,317			27,317
Series B Preferred Shares of Beneficial Interest		111,357			111,357			111,357			111,357			111,357
Common Shares of Beneficial Interest		951,868			935,287			918,221			884,415			843,268
Accumulated distributions in excess of net income		(438,432	)		(430,282	)		(420,036	)		(407,052	)		(389,758	)
Total Investors Real Estate Trust shareholders’ equity		652,110			643,679			636,859			616,037			592,184
Noncontrolling interests – Operating Partnership		58,325			61,177			63,207			84,250			105,724
Noncontrolling interests – consolidated real estate entities		30,519			31,356			26,602			25,910			22,638
Total equity		740,954			736,212			726,668			726,197			720,546
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY	$	1,997,837		$	2,001,342		$	1,961,470		$	1,931,767		$	1,869,221

6

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in thousands, except per share data)

	Twelve Months Ended						Three Months Ended
OPERATING RESULTS	4/30/2015			4/30/2014			4/30/2015			1/31/2015			10/31/2014			7/31/2014			4/30/2014
Real estate revenue	$	279,670		$	265,482		$	69,838		$	71,953		$	70,042		$	67,837		$	66,983
Real estate expenses		110,997			108,487			27,808			28,434			27,237			27,518			29,589
Gain on involuntary conversion		0			2,480			0			0			0			0			0
Net operating income		168,673			159,475			42,030			43,519			42,805			40,319			37,394
TRS senior housing revenue		3,520			1,627			921			963			843			793			823
TRS senior housing expenses		(2,997	)		(1,331	)		(754	)		(825	)		(725	)		(693	)		(660	)
Depreciation/amortization		(70,607	)		(70,918	)		(18,133	)		(17,750	)		(17,668	)		(17,056	)		(17,262	)
Administrative expenses		(11,824	)		(10,743	)		(2,516	)		(2,754	)		(2,890	)		(3,664	)		(2,801	)
Other expenses		(2,010	)		(2,132	)		(332	)		(488	)		(578	)		(612	)		(502	)
Impairment of real estate investments		(6,105	)		(42,566	)		0			(540	)		(3,245	)		(2,320	)		(37,768	)
Interest expense		(59,020	)		(59,142	)		(15,162	)		(14,595	)		(14,599	)		(14,664	)		(14,617	)
Interest and other income		2,961			2,391			904			670			696			691			922
Income (loss) before loss on sale of real estate and other investments and income from discontinued operations		22,591			(23,339	)		6,958			8,200			4,639			2,794			(34,471	)
Income (loss) on sale of real estate and other investments		6,093			(51	)		6,904			951			1,231			(2,993	)		(51	)
Income (loss) from continuing operations		28,684			(23,390	)		13,862			9,151			5,870			(199	)		(34,522	)
Income from discontinued operations		0			6,450			0			0			0			0			0
Net income (loss)	$	28,684		$	(16,940	)	$	13,862		$	9,151		$	5,870		$	(199	)	$	(34,522	)
Net loss (income) attributable to noncontrolling interest – Operating Partnership		(1,526	)		4,676			(908	)		(657	)		(363	)		402			6,082
Net income attributable to noncontrolling interests – consolidated real estate entities		(3,071	)		(910	)		(2,201	)		(123	)		(393	)		(354	)		(102	)
Net (loss) income attributable to Investors Real Estate Trust		24,087			(13,174	)		10,753			8,371			5,114			(151	)		(28,542	)
Dividends to preferred shareholders		(11,514	)		(11,514	)		(2,878	)		(2,879	)		(2,878	)		(2,879	)		(2,878	)
NET (LOSS) INCOME AVAILABLE TO COMMON SHAREHOLDERS	$	12,573		$	(24,688	)	$	7,875		$	5,492		$	2,236		$	(3,030	)	$	(31,420	)
Per Share Data
Earnings (loss) per common share from continuing operations – Investors Real Estate Trust – basic & diluted	$	.11		$	(.28	)	$	.07		$	.05		$	.02		$	(.03	)	$	(.29	)
Earnings per common share from discontinued operations – Investors Real Estate Trust – basic & diluted		.11			.05			.00			.00			.00			.00			.00
Net income per common share – basic & diluted	$	.11		$	(.23	)	$	.07		$	.05		$	.02		$	(.03	)	$	(.29	)
Percentage of Revenues
Real estate expenses		39.7	%		40.9	%		39.8	%		39.5	%		38.9	%		40.6	%		44.2	%
Depreciation/amortization		25.2	%		26.7	%		26.0	%		24.7	%		25.2	%		25.1	%		25.8	%
Administrative expenses		4.2	%		4.0	%		3.6	%		3.8	%		4.1	%		5.4	%		4.2	%
Interest		21.1	%		22.3	%		21.7	%		20.3	%		20.8	%		21.6	%		21.8	%
Income from discontinued operations		0.0	%		2.4	%		0.0	%		0.0	%		0.0	%		0.0	%		0.0	%
Net (loss) income		10.3	%		(6.4	)%		19.8	%		12.7	%		8.4	%		(0.3	)%		(51.5	)%
Ratios
Adjusted EBITDA(1)/Interest expense		2.63	x		2.36	x		2.41	x		2.53	x		2.48	x		2.29	x		2.26	x
Adjusted EBITDA(1)/Interest expense plus preferred distributions		2.20	x		1.97	x		2.05	x		2.14	x		2.10	x		1.94	x		1.90	x

(1) See Definitions on page 32.  Adjusted EBITDA is a non-GAAP measure; see page 9 for a reconciliation of Adjusted EBITDA to net income.

7

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

FUNDS FROM OPERATIONS(unaudited)

(in thousands, except per share and unit data)

	Twelve Months Ended						Three Months Ended
	4/30/2015			4/30/2014			4/30/2015			1/31/2015			10/31/2014			7/31/2014			4/30/2014
Funds From Operations(1)
Net income (loss) attributable to Investors Real Estate Trust	$	24,087		$	(13,174	)	$	10,753		$	8,371		$	5,114		$	(151	)	$	(28,542	)
Less dividends to preferred shareholders		(11,514	)		(11,514	)		(2,878	)		(2,879	)		(2,878	)		(2,879	)		(2,878	)
Net (loss) income available to common shareholders		12,573			(24,688	)		7,875			5,492			2,236			(3,030	)		(31,420	)
Adjustments:
Noncontrolling interests – Operating Partnership		1,526			(4,676	)		908			657			363			(402	)		(6,082	)
Depreciation and amortization		70,450			71,830			18,083			17,706			17,624			17,037			17,239
Impairment of real estate investments		6,105			44,426			0			540			3,245			2,320			37,768
(Gain) loss on depreciable property sales attributable to Investors Real Estate Trust	$	(4,079	)	$	(6,948	)		(4,890	)		(951	)		(1,231	)		2,993			51
Funds from operations applicable to common shares and Units		86,575			79,944		$	21,976		$	23,444		$	22,237		$	18,918		$	17,556
FFO per share and unit - basic and diluted	$	0.64		$	0.63		$	0.16		$	0.17		$	0.17		$	0.14		$	0.14
Adjusted funds from operations(1)
Funds from operations applicable to common shares and Units	$	86,575		$	79,944		$	21,976		$	23,444		$	22,237		$	18,918		$	17,556
Adjustments:
Tenant improvements at same-store(2) properties		(7,589	)		(9,937	)		(2,939	)		(1,984	)		(542	)		(2,169	)		(1,610	)
Leasing costs at same-store properties(2)		(2,290	)		(3,797	)		(684	)		(358	)		(699	)		(578	)		(1,038	)
Recurring capital expenditures(1)(2)		(6,135	)		(4,956	)		(1,342	)		(1,865	)		(1,567	)		(1,386	)		(1,118	)
Straight-line rents		12			(2,206	)		198			184			(103	)		(268	)		(70	)
Non-real estate depreciation		388			368			100			94			96			99			102
Default interest		528			0			528			0			0			0			0
Share based compensation expense(3)		2,215			1,162			280			260			601			1,073			272
Gain on involuntary conversion		0			(2,480	)		0			0			0			0			0
Adjusted funds from operations applicable to common shares and Units	$	73,704		$	58,098		$	18,117		$	19,775		$	20,023		$	15,689		$	14,094
AFFO per share and unit - basic and diluted	$	0.55		$	0.46		$	0.13		$	0.15		$	0.15		$	0.12		$	0.11
Weighted average shares and units		134,598			127,028			137,412			135,315			133,295			131,332			129,244

(1) See Definitions on page 32.

(2) Quarterly information is for properties in the same-store pool at that point in time; consequently, quarterly numbers may not total to year-to-date numbers.

(3) Twelve months ended 4/30/14 revised to include share based compensation expense. Three months ended 7/31/14 and 4/30/14  revised to include trustee share-based compensation expense.

8

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (ADJUSTED EBITDA)

(unaudited)

(in thousands)

	Twelve Months Ended						Three Months Ended
	4/30/2015			4/30/2014			4/30/2015			1/31/2015			10/31/2014			7/31/2014			4/30/2014
Adjusted EBITDA(1)
Net income (loss) attributable to Investors Real Estate Trust	$	24,087		$	(13,174	)	$	10,753		$	8,371		$	5,114		$	(151	)	$	(28,542	)
Adjustments:
Noncontrolling interests – Operating Partnership		1,526			(4,676	)		908			657			363			(402	)		(6,082	)
Income (loss) before noncontrolling interests – Operating Partnership		25,613			(17,850	)		11,661			9,028			5,477			(553	)		(34,624	)
Add:
Interest expense		59,020			59,563			15,162			14,595			14,599			14,664			14,617
Depreciation/amortization related to real estate investments		67,112			68,542			17,266			16,834			16,814			16,198			16,449
Amortization related to non-real estate investments		3,495			3,416			867			916			840			872			826
Amortization related to real estate revenues(2)		231			241			50			50			66			65			66
Impairment of real estate investments		6,105			44,426			0			540			3,245			2,320			37,768
Less:
Interest income		(2,238	)		(1,908	)		(557	)		(561	)		(560	)		(560	)		(562	)
Gain on depreciable property sales attributable to Investors Real Estate Trust		(4,079	)		(6,948	)		(4,890	)		(951	)		(1,231	)		2,993			51
Gain on involuntary conversion		0			(2,480	)		0			0			0			0			0
Adjusted EBITDA	$	155,259		$	147,002			39,559			40,451			39,250			35,999			34,591

(1) See Definitions on page 32.

(2) Included in real estate revenue in the Statement of Operations.

9

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

LONG-TERM MORTGAGE DEBT* ANALYSIS

(in thousands)

Debt Maturity Schedule

Annual Expirations

Total Mortgage Debt*

	Future Maturities of Mortgage Debt
Fiscal Year	Fixed Debt		Variable Debt		Total Debt		Weighted Average(1)			% of Total Debt
2016	$	97,993	$	0	$	97,993		4.23	%		10.1	%
2017		167,804		15,000		182,804		5.85	%		18.7	%
2018		32,718		31,000		63,718		4.32	%		6.5	%
2019		80,828		5,345		86,173		5.80	%		8.8	%
2020		112,812		18,622		131,434		5.37	%		13.5	%
2021		128,720		0		128,720		5.30	%		13.2	%
2022		128,774		0		128,774		5.61	%		13.2	%
2023		37,164		0		37,164		4.25	%		3.8	%
2024		66,326		0		66,326		4.29	%		6.8	%
2025		19,845		0		19,845		4.04	%		2.1	%
Thereafter		31,877		0		31,877		4.41	%		3.3	%
Total maturities	$	904,861	$	69,967	$	974,828		5.16	%		100.0	%

(1) Weighted average interest rate of debt that matures in fiscal year.

	4/30/15			1/31/2015			10/31/2014			7/31/2014			4/30/2014
Balances Outstanding
Mortgage
Fixed rate	$	904,861		$	927,724		$	949,002		$	972,142		$	977,224
Variable rate		69,967			78,455			64,159			45,432			20,465
Mortgage total	$	974,828		$	1,006,179		$	1,013,161		$	1,017,574		$	997,689
Weighted Average Interest Rates
Secured		5.16	%		5.17	%		5.26	%		5.32	%		5.37	%

10

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

LONG-TERM MORTGAGE DEBT* DETAIL AS OF APRIL 30, 2015

(in thousands)

Property	Maturity Date	Fiscal 2016		Fiscal 2017		Fiscal 2018		Fiscal 2019		Thereafter		Total(1)
Multi-Family Residential
Campus Center - St Cloud, MN(2)	6/1/2015	$	1,127	$	0	$	0	$	0	$	0	$	1,127
Campus Knoll - St Cloud, MN(2)	6/1/2015		752		0		0		0		0		752
Landmark - Grand Forks, ND	8/24/2015		1,573		0		0		0		0		1,573
Regency Park Estates - St Cloud, MN	1/1/2016		6,680		0		0		0		0		6,680
Pebble Springs – Bismarck, ND	7/1/2016		0		757		0		0		0		757
Southview – Minot, ND	7/1/2016		0		1,035		0		0		0		1,035
Homestead Gardens I – Rapid City, SD	7/11/16		0		6,895		0		0		0		6,895
River Ridge – Bismarck, ND	6/30/17		0		0		13,200		0		0		13,200
Evergreen II – Isanti, MN	11/1/2017		0		0		2,066		0		0		2,066
Ponds – Sartell, MN	11/1/2017		0		0		3,852		0		0		3,852
Homestead Gardens II - Rapid City, SD	6/1/2018		0		0		0		3,433		0		3,433
IRET Corporate Plaza Apts - Minot, ND	8/1/2018		0		0		0		5,348		0		5,348
Greenfield - Omaha, NE	2/1/2019		0		0		0		3,552		0		3,552
Grand Gateway - St. Cloud, MN	3/1/2019		0		0		0		5,345		0		5,345
Brooklyn Heights - Minot, ND	4/1/2019		0		0		0		694		0		694
Colton Heights - Minot, ND	4/1/2019		0		0		0		391		0		391
Pines - Minot, ND	4/1/2019		0		0		0		111		0		111
Summit Park - Minot, ND	4/1/2019		0		0		0		963		0		963
Terrace Heights - Minot, ND	4/1/2019		0		0		0		160		0		160
Summary of Debt due after Fiscal 2019			0		0		0		0		366,018		366,018
Sub-Total Multi-Family Residential		$	10,132	$	8,687	$	19,118	$	19,997	$	366,018	$	423,952
Office
US Bank Financial Center - Bloomington, MN	7/1/2015		12,766		0		0		0		0		12,766
Rapid City 900 Concourse Drive - Rapid City, SD	8/1/2015		181		0		0		0		0		181
Westgate I - Boise, ID	8/1/2015		1,115		0		0		0		0		1,115
Westgate II - Boise, ID	8/1/2015		2,729		0		0		0		0		2,729
Brook Valley I - LaVista, NE	1/1/2016		1,209		0		0		0		0		1,209
Spring Valley IV - Omaha, NE	1/1/2016		720		0		0		0		0		720
Spring Valley V - Omaha, NE	1/1/2016		792		0		0		0		0		792
Spring Valley X - Omaha, NE	1/1/2016		734		0		0		0		0		734
Spring Valley XI - Omaha, NE	1/1/2016		720		0		0		0		0		720
American Corporate Center – Mendota Heights, MN	9/1/2016		0		8,670		0		0		0		8,670
Mendota Office Center I – Mendota Heights, MN	9/1/2016		0		3,734		0		0		0		3,734
Mendota Office Center II - Mendota Heights, MN	9/1/2016		0		5,516		0		0		0		5,516
Mendota Office Center III - Mendota Heights, MN	9/1/2016		0		3,791		0		0		0		3,791
Mendota Office Center IV - Mendota Heights, MN	9/1/2016		0		4,507		0		0		0		4,507
Corporate Center West – Omaha, NE(3)	10/6/2016		0		17,315		0		0		0		17,315
Farnam Executive Center – Omaha, NE(3)	10/6/2016		0		12,160		0		0		0		12,160
Flagship – Eden Prairie, MN(3)	10/6/2016		0		21,565		0		0		0		21,565
Gateway Corporate Center – Woodbury, MN(3)	10/6/2016		0		8,700		0		0		0		8,700

11

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

LONG-TERM MORTGAGE DEBT* DETAIL AS OF APRIL 30, 2015 (continued)

(in thousands)

Property	Maturity Date	Fiscal 2016		Fiscal 2017		Fiscal 2018		Fiscal 2019		Thereafter		Total(1)
Office - continued
Miracle Hills One – Omaha, NE(3)	10/6/2016	$	0	$	8,895	$	0	$	0	$	0	$	8,895
Pacific Hills – Omaha, NE(3)	10/6/2016		0		16,770		0		0		0		16,770
Riverport – Maryland Heights, MO(3)	10/6/2016		0		19,690		0		0		0		19,690
Timberlands – Leawood, KS(3)	10/6/2016		0		13,155		0		0		0		13,155
Woodlands Plaza IV – Maryland Heights, MO(3)	10/6/2016		0		4,360		0		0		0		4,360
TCA Building – Eagan, MN	2/3/2017		0		7,500		0		0		0		7,500
Interlachen Corporate Center – Eagan, MN	6/30/17		0		0		8,800		0		0		8,800
Plymouth 5095 Nathan Lane – Plymouth, MN	11/1/2017		0		0		1,147		0		0		1,147
Prairie Oak Business Center – Eden Prairie, MN	11/1/2017		0		0		3,120		0		0		3,120
Crosstown Centre – Eden Prairie, MN	12/1/2017		0		0		9,000		0		0		9,000
7800 West Brown Deer Road – Milwaukee, WI	4/1/2018		0		0		10,320		0		0		10,320
Intertech Building- Fenton, MO	5/1/2018		0		0		0		4,177		0		4,177
610 Business Center IV - Brooklyn Park, MN	7/1/2018		0		0		0		6,759		0		6,759
Plaza 16 - Minot, ND	8/1/2018		0		0		0		7,098		0		7,098
Wells Fargo Center - St Cloud, MN	8/1/2018		0		0		0		5,787		0		5,787
Ameritrade - Omaha, NE	4/1/2019		0		0		0		2,020		0		2,020
Summary of Debt due after Fiscal 2019			0		0		0		0		43,785		43,785
Sub-Total Office		$	20,966	$	156,328	$	32,387	$	25,841	$	43,785	$	279,307
Healthcare
Edina 6363 France Medical - St Paul, MN	8/6/2015		9,567		0		0		0		0		9,567
Edina 6405 France Medical - Edina, MN	9/1/2015		8,145		0		0		0		0		8,145
Ritchie Medical Plaza - St Paul, MN(2)	9/1/2015		5,980		0		0		0		0		5,980
Edgewood Vista – Fargo, ND	2/25/2016		11,846		0		0		0		0		11,846
Edgewood Vista – Fremont, NE	2/25/2016		550		0		0		0		0		550
Edgewood Vista – Hastings, NE	2/25/2016		567		0		0		0		0		567
Edgewood Vista – Hermantown I, MN	2/25/2016		15,197		0		0		0		0		15,197
Edgewood Vista – Kalispell, MT	2/25/2016		568		0		0		0		0		568
Edgewood Vista – Missoula, MT	2/25/2016		807		0		0		0		0		807
Edgewood Vista – Omaha, NE	2/25/2016		359		0		0		0		0		359
Edgewood Vista – Virginia, MN	2/25/2016		12,927		0		0		0		0		12,927
Airport Medical – Bloomington, MN	6/1/2016		0		431		0		0		0		431
Park Dental – Brooklyn Center, MN	6/1/2016		0		247		0		0		0		247
Sartell 2000 23rd St S – Sartell, MN	12/1/2016		0		1,593		0		0		0		1,593
Billings 2300 Grant Road – Billings, MT	12/31/2016		0		1,226		0		0		0		1,226
Missoula 3050 Great Northern Ave – Missoula, MT	12/31/2016		0		1,267		0		0		0		1,267
High Pointe Health Campus – Lake Elmo, MN	4/1/2017		0		7,500		0		0		0		7,500
Edgewood Vista – Billings, MT	4/10/2017		0		1,785		0		0		0		1,785
Edgewood Vista – East Grand Forks, MN	4/10/2017		0		2,718		0		0		0		2,718
Edgewood Vista – Sioux Falls, SD	4/10/2017		0		1,022		0		0		0		1,022
St Michael Clinic – St. Michael, MN	4/1/2018		0		0		1,795		0		0		1,795
Spring Creek - American Falls - American Falls, ID	9/1/2018		0		0		0		2,086		0		2,086
Spring Creek - Eagle - Eagle, ID	9/1/2018		0		0		0		1,919		0		1,919
Spring Creek - Meridian - Meridian, ID	9/1/2018		0		0		0		3,171		0		3,171
Spring Creek - Soda Springs - Soda Springs, ID	9/1/2018		0		0		0		751		0		751

12

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

LONG-TERM MORTGAGE DEBT* DETAIL AS OF APRIL 30, 2015 (continued)

(in thousands)

Property	Maturity Date	Fiscal 2016		Fiscal 2017		Fiscal 2018		Fiscal 2019		Thereafter		Total(1)
Healthcare - continued
Barry Pointe Office Park - Kansas City, MO	12/15/2018	$	0	$	0	$	0	$	1,369	$	0	$	1,369
Health East St John & Woodwinds - Maplewood & Woodbury, MN	2/1/2019		0		0		0		7,366		0		7,366
Nebraska Orthopedic Hospital - Omaha, NE	4/1/2019		0		0		0		11,039		0		11,039
Summary of Debt due after Fiscal 2019			0		0		0		0		118,680		118,680
Sub-Total Healthcare		$	66,513	$	17,789	$	1,795	$	27,701	$	118,680	$	232,478

Industrial
Stone Container - Fargo, ND	12/1/2015		172		0		0		0		0		172
Stone Container - Fargo, ND	12/1/2015		210		0		0		0		0		210
Urbandale 3900 106th Street – Urbandale, IA	7/5/2017		0		0		10,418		0		0		10,418
Summary of Debt due after Fiscal 2019			0		0		0		0		1,604		1,604
Sub-Total Industrial		$	382	$	0	$	10,418	$	0	$	1,604	$	12,404
Retail
Chan West Village -  Chanhassen, MN			0		0		0		12,307		0		12,307
Jamestown Business Center – Jamestown, MN			0		0		0		327		0		327
Summary of Debt due after Fiscal 2019			0		0		0		0		14,053		14,053
Sub-Total Retail		$	0	$	0	$	0	$	12,634	$	14,053	$	26,687
Total		$	97,993	$	182,804	$	63,718	$	86,173	$	544,140	$	974,828

* Mortgage debt does not include the Company’s multi-bank line of credit or construction loans. The line of credit has a maturity date of September 1, 2017; as of April 30, 2015, the Company had borrowings of $60.5 million outstanding under this line. Construction loans and other debt totaled $144.1 million as of April 30, 2015.

(1) Totals are principal balances as of April 30, 2015.

(2) Loan was paid off subsequent to April 30, 2015.

(3) Amount is part of a non-recourse $122.6 million CMBS loan, for which nine of the Company’s office properties serve as collateral and under which a special-purpose subsidiary of the Company is the borrower. This loan matures in October 2016. Because the loan amount significantly exceeds the Company’s current estimate of the fair value of this nine-property portfolio, the Company contacted the master servicer to initiate discussions on various alternatives with regard to the loan. During the first quarter of fiscal year 2015, the Company was notified that the loan has been transferred to the special servicer. On April 14, 2015 the Company received a letter from the special servicer advising that the loan was in default due to a nonpayment on April 6, 2015. The Company cannot predict the outcome of discussions with the special servicer regarding the loan.

13

 INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

CAPITAL ANALYSIS

(in thousands, except per share and unit amounts)

	Three Months Ended
	4/30/2015		1/31/2015		10/31/2014		7/31/2014		4/30/2014
Equity Capitalization
Common shares outstanding		124,456		122,134		119,809		114,763		109,019
Operating partnership (OP) units outstanding		14,000		14,398		14,731		17,975		21,094
Total common shares and OP units outstanding		138,456		136,532		134,540		132,738		130,113
Market price per common share (closing price at end of period)	$	7.17	$	8.25	$	8.40	$	8.52	$	8.72
Equity capitalization-common shares and OP units	$	1,142,262	$	1,126,389	$	1,130,136	$	1,130,928	$	1,134,585
Recorded book value of preferred shares	$	138,674	$	138,674	$	138,674	$	138,674	$	138,674
Total equity capitalization	$	1,280,936	$	1,265,063	$	1,268,810	$	1,269,602	$	1,273,259
Debt Capitalization
Total debt	$	1,178,851	$	1,188,218	$	1,160,628	$	1,135,892	$	1,083,321
Total capitalization	$	2,459,787	$	2,453,281	$	2,429,438	$	2,405,494	$	2,356,580
Total debt to total capitalization	0.48:1		0.48:1		0.48:1		0.47:1		0.46:1

	Twelve Months Ended						Three Months Ended
	4/30/2015			4/30/2014			4/30/2015			1/31/2015			10/31/2014			7/31/2014			4/30/2014
Earnings to fixed charges(1)		1.33	x			(2)		1.63	x		1.48	x		1.27	x			(3)			(4)
Earnings to combined fixed charges and preferred distributions(1)		1.12	x			(2)		1.39	x		1.25	x		1.08	x			(3)			(4)
Debt service coverage ratio(1)		1.91	x		1.59	x		2.41	x		1.70	x		1.71	x		1.57	x		1.53	x
Distribution Data
Common shares and units outstanding at record date		137,596			129,372			137,596			135,490			133,527			130,795			129,372
Total common distribution paid	$	69,854		$	66,012		$	17,879		$	17,613		$	17,358		$	17,004		$	16,819
Common distribution per share and unit	$	.5200		$	.5200		$	.1300		$	.1300		$	.1300		$	.1300		$	.1300
Payout ratio (FFO per share and unit basis)(1)		81.3	%		82.5	%		81.3	%		76.5	%		76.5	%		92.9	%		92.9	%
Payout ratio (AFFO per share and unit basis)(1)		94.5	%		115.6	%		100.0	%		86.7	%		86.7	%		108.3	%		118.2	%

(1) See Definitions on page 32.

(2) Due to non-cash asset impairment charges of $42.6 million in the twelve months ended April 30, 2014, earnings were inadequate to cover fixed charges and combined fixed charges and preferred distributions by $27.2 million and $38.7 million, respectively. Excluding the asset impairment charge, the ratios of earnings to fixed charges and earnings to combined fixed charges and preferred distributions would have been 1.25 and 1.05, respectively, for the fiscal year ended April 30, 2014.

(3) Due to non-cash asset impairment and loss on sale charges of $5.3 million in the three months ended July 31, 2014, earnings were inadequate to cover fixed charges and combined fixed charges and preferred distributions by $1.6 million and $4.5 million, respectively. Excluding the asset impairment and loss on sale charges, the ratios of earnings to fixed charges and earnings to combined fixed charges and preferred distributions would have been 1.24 and 1.05, respectively, for the three months ended July 31, 2014.

(4) Due to non-cash asset impairment charges of $37.8 million in the three months ended April 30, 2014, earnings were inadequate to cover fixed charges and combined fixed charges and preferred distributions by $35.3 million and $38.2 million, respectively. Excluding the asset impairment charge, the ratios of earnings to fixed charges and earnings to combined fixed charges and preferred distributions would have been 1.16 and 0.98, respectively, for the three months ended April 30, 2014.

14

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

SAME-STORE PROPERTIES NET OPERATING INCOME SUMMARY

(in thousands)

	Same-Store Properties(1)							Same-Store Properties(1)
	Three Months Ended April 30							Twelve Months Ended April 30
Segment	2015		2014		% Change			2015		2014		% Change
Multi-Family Residential	$	13,839	$	12,151		13.9	%	$	54,932	$	52,930		3.8	%
Office		9,151		8,968		2.0	%		36,095		36,942		(2.3	%)
Healthcare		10,989		10,465		5.0	%		45,850		45,192		1.5	%
Industrial		1,343		1,210		11.0	%		4,996		4,840		3.2	%
Retail		2,118		2,103		0.7	%		8,160		8,087		0.9	%
	$	37,440	$	34,897		7.3	%	$	150,033	$	147,991		1.4	%

(1) See list of properties excluded from same-store properties on page ii.

15

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

NET OPERATING INCOME DETAIL

(in thousands)

	Three Months Ended April 30, 2015
	Reporting Segments
	Multi-Family Residential			Office			Healthcare			Industrial			Retail			Corporate and Other			Total
Real estate rental revenue
Same-store(1)	$	24,866		$	17,346		$	15,172		$	1,546		$	3,237		$	0		$	62,167
Non-same-store		6,083			716			737			40			95			0			7,671
Total		30,949			18,062			15,909			1,586			3,332			0			69,838
Real estate expenses
Same-store(1)		11,027			8,195			4,183			203			1,119			0			24,727
Non-same-store		2,442			423			88			113			15			0			3,081
Total		13,469			8,618			4,271			316			1,134			0			27,808
Net operating income (NOI)
Same-store(1)		13,839			9,151			10,989			1,343			2,118			0			37,440
Non-same-store		3,641			293			649			(73	)		80			0			4,590
Net operating income	$	17,480		$	9,444		$	11,638		$	1,270		$	2,198		$	0		$	42,030
Reconciliation of NOI to net income (loss) available to common shareholders
TRS senior housing revenue	$	0		$	0		$	0		$	0		$	0		$	921		$	921
TRS senior housing expenses		0			0			0			0			0			(754	)		(754	)
Depreciation/amortization		(7,519	)		(4,389	)		(4,915	)		(457	)		(753	)		(100	)		(18,133	)
Administrative expenses		0			0			0			0			0			(2,516	)		(2,516	)
Other expenses		0			0			0			0			0			(332	)		(332	)
Interest expense		(5,921	)		(5,313	)		(3,406	)		(220	)		(323	)		21			(15,162	)
Interest and other income		0			0			0			0			0			904			904
Income (loss) before gain on sale of real estate and other investments		4,040			(258	)		3,317			593			1,122			(1,856	)		6,958
Gain on sale of real estate and other investments		0			117			4,109			0			3,025			(347	)		6,904
Net income (loss)		4,040			(141	)		7,426			593			4,147			(2,203	)		13,862
Net income attributable to noncontrolling interests – Operating Partnership		0			0			0			0			0			(908	)		(908	)
Net income attributable to noncontrolling interests – consolidated real estate entities		0			0			0			0			0			(2,201	)		(2,201	)
Net income (loss) attributable to Investors Real Estate Trust		4,040			(141	)		7,426			593			4,147			(5,312	)		10,753
Dividends to preferred shareholders		0			0			0			0			0			(2,878	)		(2,878	)
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	4,040		$	(141	)	$	7,426		$	593		$	4,147		$	(8,190	)	$	7,875

(1) See list of properties excluded from same-store properties on page ii.

16

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

NET OPERATING INCOME DETAIL

	Three Months Ended April 30, 2014
	Reporting Segments
	Multi-Family Residential			Commercial Office			Commercial Healthcare			Commercial Industrial			Commercial Retail			Corporate and Other			Total
Real estate rental revenue
Same-store(1)	$	19,502		$	19,307		$	15,429		$	1,412		$	3,640		$	0		$	59,290
Non-same-store		6,898			58			488			210			39			0			7,693
Total		26,400			19,365			15,917			1,622			3,679			0			66,983
Real estate expenses
Same-store(1)		9,895			9,797			4,487			442			1,389			0			26,010
Non-same-store		3,238			79			108			152			2			0			3,579
Total		13,133			9,876			4,595			594			1,391			0			29,589
Net operating income (NOI)
Same-store(1)		9,607			9,510			10,942			970			2,251			0			33,280
Non-same-store		3,660			(21	)		380			58			37			0			4,114
Net operating income	$	13,267		$	9,489		$	11,322		$	1,028		$	2,288		$	0		$	37,394
Reconciliation of NOI to net income (loss) available to common shareholders
TRS senior housing revenue	$	0		$	0		$	0		$	0		$	0		$	823		$	823
TRS senior housing expenses		0			0			0			0			0			(660	)		(660	)
Depreciation/amortization		(5,683	)		(5,276	)		(5,029	)		(379	)		(805	)		(90	)		(17,262	)
Administrative expenses		0			0			0			0			0			(2,801	)		(2,801	)
Other expenses		0			0			0			0			0			(502	)		(502	)
Impairment of real estate investments		0			(37,768	)		0			0			0			0			(37,768	)
Interest expense		(5,455	)		(4,924	)		(3,839	)		(205	)		(381	)		187			(14,617	)
Interest and other income		0			0			0			0			0			922			922
Income (loss) before loss on sale of real estate and other investments		2,129			(38,479	)		2,454			444			1,102			(2,121	)		(34,471	)
Loss on sale of real estate and other investments		0			0			0			0			0			(51	)		(51	)
Net income (loss)		2,129			(38,479	)		2,454			444			1,102			(2,172	)		(34,522	)
Net loss attributable to noncontrolling interests – Operating Partnership		0			0			0			0			0			6,082			6,082
Net income attributable to noncontrolling interests – consolidated real estate entities		0			0			0			0			0			(102	)		(102	)
Net income (loss) attributable to Investors Real Estate Trust		2,129			(38,479	)		2,454			444			1,102			3,808			(28,542	)
Dividends to preferred shareholders		0			0			0			0			0			(2,878	)		(2,878	)
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	2,129		$	(38,479	)	$	2,454		$	444		$	1,102		$	930		$	(31,420	)

(1) See list of properties excluded from same-store properties on page ii.

17

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

NET OPERATING INCOME DETAIL

(in thousands)

	Twelve Months Ended April 30, 2015
	Reporting Segments
	Multi-Family Residential			Office			Healthcare			Industrial			Retail			Corporate and Other			Total
Real estate rental revenue
Same-store(1)	$	99,072		$	69,990		$	62,406		$	6,304		$	12,648		$	0		$	250,420
Non-same-store		19,454			4,988			3,824			187			797			0			29,250
Total		118,526			74,978			66,230			6,491			13,445			0			279,670
Real estate expenses
Same-store(1)		44,140			33,895			16,556			1,308			4,488			0			100,387
Non-same-store		7,032			2,596			620			228			134			0			10,610
Total		51,172			36,491			17,176			1,536			4,622			0			110,997
Net operating income (NOI)
Same-store(1)		54,932			36,095			45,850			4,996			8,160			0			150,033
Non-same-store		12,422			2,392			3,204			(41	)		663			0			18,640
Net operating income	$	67,354		$	38,487		$	49,054		$	4,955		$	8,823		$	0		$	168,673
Reconciliation of NOI to net income (loss) available to common shareholders
TRS senior housing revenue	$	0		$	0		$	0		$	0		$	0		$	3,520		$	3,520
TRS senior housing expenses		0			0			0			0			0			(2,997	)		(2,997	)
Depreciation/amortization		(26,638	)		(18,621	)		(19,910	)		(1,628	)		(3,422	)		(388	)		(70,607	)
Administrative expenses		0			0			0			0			0			(11,824	)		(11,824	)
Other expenses		0			0			0			0			0			(2,010	)		(2,010	)
Impairment of real estate investments		0			(3,428	)		0			0			(1,384	)		(1,293	)		(6,105	)
Interest expense		(22,782	)		(19,792	)		(14,617	)		(825	)		(1,359	)		355			(59,020	)
Interest and other income		0			0			0			0			0			2,961			2,961
Income (loss) before loss on sale of real estate and other investments		17,934			(3,354	)		14,527			2,502			2,658			(11,676	)		22,591
Loss on sale of real estate and other investments		1,418			242			4,109			(1,793	)		3,658			(1,541	)		6,093
Net income (loss)		19,352			(3,112	)		18,636			709			6,316			(13,217	)		28,684
Net income attributable to noncontrolling interests – Operating Partnership		0			0			0			0			0			(1,526	)		(1,526	)
Net income attributable to noncontrolling interests – consolidated real estate entities		0			0			0			0			0			(3,071	)		(3,071	)
Net income (loss) attributable to Investors Real Estate Trust		19,352			(3,112	)		18,636			709			6,316			(17,814	)		24,087
Dividends to preferred shareholders		0			0			0			0			0			(11,514	)		(11,514	)
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	19,352		$	(3,112	)	$	18,636		$	709		$	6,316		$	(29,328	)	$	12,573

(1) See list of properties excluded from same-store properties on page ii.

18

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

NET OPERATING INCOME DETAIL

(in thousands)

	Twelve Months Ended April 30, 2014
	Reporting Segments
	Multi-Family Residential			Office			Healthcare			Industrial			Retail			Corporate and Other			Total
Real estate rental revenue
Same-store(1)	$	95,831		$	71,398		$	61,750		$	6,179		$	12,805		$	0		$	247,963
Non-same-store		6,228			6,042			3,508			715			1,026			0			17,519
Total		102,059			77,440			65,258			6,894			13,831			0			265,482
Real estate expenses
Same-store(1)		42,901			34,456			16,558			1,339			4,718			0			99,972
Non-same-store		3,237			3,734			569			704			271			0			8,515
Total		46,138			38,190			17,127			2,043			4,989			0			108,487
Gain on involuntary conversion
Same-store(1)		0			0			0			0			0			0			0
Non-same-store		2,480			0			0			0			0			0			2,480
Total		2,480			0			0			0			0			0			2,480
Net operating income (NOI)
Same-store(1)		52,930			36,942			45,192			4,840			8,087			0			147,991
Non-same-store		5,471			2,308			2,939			11			755			0			11,484
Net operating income	$	58,401		$	39,250		$	48,131		$	4,851		$	8,842		$	0		$	159,475
Reconciliation of NOI to net income (loss) available to common shareholders
TRS senior housing revenue	$	0		$	0		$	0		$	0		$	0		$	1,627		$	1,627
TRS senior housing expenses		0			0			0			0			0			(1,331	)		(1,331	)
Depreciation/amortization		(22,210	)		(21,840	)		(21,539	)		(1,789	)		(3,201	)		(339	)		(70,918	)
Administrative expenses		0			0			0			0			0			(10,743	)		(10,743	)
Other expenses		0			0			0			0			0			(2,132	)		(2,132	)
Impairment of real estate investments		0			(37,768	)		0			(4,798	)		0			0			(42,566	)
Interest expense		(21,731	)		(20,195	)		(15,615	)		(973	)		(1,787	)		1,159			(59,142	)
Interest and other income		0			0			0			0			0			2,391			2,391
Income (loss) before loss on sale of real estate and other investments		14,460			(40,553	)		10,977			(2,709	)		3,854			(9,368	)		(23,339	)
Loss on sale of real estate and other investments		0			0			0			0			0			(51	)		(51	)
(Loss) income from continuing operations		14,460			(40,553	)		10,977			(2,709	)		3,854			(9,419	)		(23,390	)
(Loss) income from discontinued operations		(99	)		(1,794	)		0			8,923			(580	)		0			6,450
Net income (loss)		14,361			(42,347	)		10,977			6,214			3,274			(9,419	)		(16,940	)
Net income attributable to noncontrolling interests – Operating Partnership		0			0			0			0			0			4,676			4,676
Net income attributable to noncontrolling interests – consolidated real estate entities		0			0			0			0			0			(910	)		(910	)
Net income (loss) attributable to Investors Real Estate Trust		14,361			(42,347	)		10,977			6,214			3,274			(5,653	)		(13,174	)
Dividends to preferred shareholders		0			0			0			0			0			(11,514	)		(11,514	)
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	14,361		$	(42,347	)	$	10,977		$	6,214		$	3,274		$	(17,167	)	$	(24,688	)

(1) See list of properties excluded from same-store properties on page ii.

19

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

SAME-STORE PROPERTIES AND ALL PROPERTIES OCCUPANCY LEVELS BY SEGMENT

April 30, 2015 vs. April 30, 2014

Segments	Same-Store Properties						All Properties
	April 30, 2015			April 30, 2014			April 30, 2015			April 30, 2014
Multi-Family Residential		94.7	%		93.4	%		92.0	%		93.0	%
Office		84.8	%		84.0	%		83.2	%		80.7	%
Healthcare		95.7	%		96.2	%		95.8	%		96.3	%
Industrial		100.0	%		100.0	%		83.4	%		87.8	%
Retail		83.3	%		88.2	%		83.4	%		87.4	%

20

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

MULTI-FAMILY RESIDENTIAL SUMMARY⁽²⁾

	Three Months Ended
	4/30/2015			01/31/15			10/31/14			07/31/14			04/30/14
Number of Units		11,844			11,765			11,292			11,080			10,779
Average Investment Per Unit
Same-Store	$	66,741		$	66,466		$	66,233		$	65,956		$	61,323
Non-Same-Store		146,337			143,999			133,763			125,239			100,374
All Properties	$	79,617		$	77,723		$	74,190		$	71,326		$	69,905
Average Scheduled Rent(1) per Unit
Same-Store	$	843		$	841		$	835		$	825		$	785
Non-Same-Store		1,452			1,390			1,320			1,220			1,051
All Properties	$	942		$	920		$	892		$	861		$	843
Total Receipts per Unit
Same-Store	$	838		$	835		$	844		$	820		$	773
Non-Same-Store		1,062			1,087			1,121			1,067			971
All Properties	$	874		$	871		$	877		$	842		$	816
Total Recurring Capital Expenditures per Unit(1)	$	136		$	119		$	158		$	139		$	133
Occupancy%
Same-Store		94.7	%		94.0	%		95.6	%		93.8	%		94.5	%
Non-Same-Store		78.6	%		77.1	%		87.6	%		89.5	%		87.6	%
All Properties		92.0	%		91.3	%		94.6	%		93.4	%		93.0	%
Operating Expenses as a % of Scheduled Rent
Same-Store		44.2	%		46.0	%		43.7	%		46.0	%		50.2	%
Non-Same-Store		30.0	%		27.0	%		28.8	%		29.5	%		45.9	%
All Properties		40.7	%		41.8	%		41.1	%		43.9	%		49.0	%

(1) See Definitions on page 32.

(2) Previously-reported amounts are not revised for discontinued operations or changes in the composition of the same-store properties pool.

21

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

COMMERCIAL LEASING SUMMARY (Same-Store Properties)

Commercial Leasing Activity

During fiscal year 2015, we have executed new and renewal commercial leases for our same-store rental properties on 234,589 square feet for the three months ended April 30, 2015 and 1,075,008 square feet for the twelve months ended April, 2015. Despite our leasing efforts, occupancy in our same-store commercial portfolio decreased to 89.7% as of April 30, 2015, down from 90.1% as of April 30, 2014.

The total leasing activity for our same-store commercial rental properties, expressed in square feet of leases signed during the period, and the resulting occupancy levels, are as follows:

Three Months Ended April 30, 2015 and 2014

	Square Feet of New Leases(1)				Square Feet of Leases Renewed(1)				Total Square Feet of Leases Executed(1)				Occupancy
Segments	2015		2014		2015		2014		2015		2014		2015			2014
Office		48,383		77,881		90,766		89,038		139,149		166,919		84.8	%		84.0	%
Healthcare		3,174		6,360		1,270		5,971		4,444		12,331		95.7	%		96.2	%
Industrial		0		0		9,702		0		9,702		0		100.0	%		100.0	%
Retail		6,525		3,498		74,769		45,629		81,294		49,127		83.3	%		88.2	%
Total		58,082		87,739		176,507		140,638		234,589		228,377		89.7	%		90.1	%

(1) The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP.  Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period.

Twelve Months Ended April 30, 2015 and 2014

	Square Feet of New Leases(1)				Square Feet of Leases Renewed(1)				Total Square Feet of Leases Executed(1)				Occupancy
Segments	2015		2014		2015		2014		2015		2014		2015			2014
Office		168,007		356,024		421,006		311,836		589,013		667,860		84.8	%		84.0	%
Healthcare		21,153		37,628		109,661		40,967		130,814		78,595		95.7	%		96.2	%
Industrial		0		234,403		39,697		251,831		39,697		486,234		100.0	%		100.0	%
Retail		57,777		128,464		257,707		123,886		315,484		252,350		83.3	%		88.2	%
Total		246,937		756,519		828,071		728,520		1,075,008		1,485,039		89.7	%		90.1	%

(1) The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP.  Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period.

22

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

COMMERCIAL LEASING SUMMARY (Same-Store Properties)

New Leases

The following table sets forth the average effective rents and the estimated costs of tenant improvements and leasing commissions, on a per square foot basis, that we are obligated to fulfill under the new leases signed for our same-store commercial rental properties:

Three Months Ended April 30, 2015 and 2014

	Square Feet of New Leases(1)				Average Term in Years				Average Effective Rent(2)				Estimated Tenant Improvement Cost per Square Foot(1)				Leasing Commissions per Square Foot(1)
	2015		2014		2015		2014		2015		2014		2015		2014		2015		2014
Office		48,383		77,881		4.7		4.1	$	11.81	$	10.42	$	23.85	$	14.03	$	6.37	$	4.32
Healthcare		3,174		6,360		0.3		6.0		3.78		22.56		0		50.00		0		7.50
Industrial		0		0		0		0		0		0		0		0		0		0
Retail		6,525		3,498		2.1		1.5		10.14		10.47		0		0		2.74		0
Total		58,082		87,739		3.8		3.5	$	11.18	$	11.30	$	19.87	$	16.08	$	5.62	$	4.38

(1) The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP.  Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions presented are based on square feet leased during the period.

(2) Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.

Twelve Months Ended April 30, 2015 and 2014

	Square Feet of New Leases(1)				Average Term in Years				Average Effective Rent(2)				Estimated Tenant Improvement Cost per Square Foot(1)				Leasing Commissions per Square Foot(1)
	2015		2014		2015		2014		2015		2014		2015		2014		2015		2014
Office		168,007		356,024		4.7		4.2	$	13.37	$	13.42	$	18.01	$	13.30	$	5.63	$	4.33
Healthcare		21,153		37,628		5.4		4.9		17.57		21.58		31.58		49.71		5.81		6.88
Industrial		0		234,403		0		3.1		0		3.55		0		0.13		0		0.50
Retail		57,777		128,464		3.3		4.5		8.56		5.83		14.42		1.79		3.38		4.35
Total		246,937		759,519		4.4		4.3	$	12.60	$	9.48	$	18.33	$	9.08	$	5.12	$	3.27

(1) The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP.  Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions presented are based on square feet leased during the period.

(2) Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.

Our ability to maintain or increase occupancy rates is a principal driver of maintaining and increasing the average effective rents in our commercial segments. The decrease in the average effective rental rates of new leases executed in our healthcare segment in the three months ended April 30, 2015 and the twelve months ended April 30, 2015 when compared to new leases executed in the same periods in the prior fiscal year is due to the signing of a 3,174 square foot lease for storage space at our St. Paul, Minnesota Ritchie Medical Plaza property for $3.78 per square foot.  Absent this transaction, the average effective rental rate for leases executed in our healthcare segment for the twelve months ended April 30, 2015 would have been $20.00 per square foot. The increase in the average effective rental rates of new leases executed in the twelve months ended April 30, 2015 in our retail segment when compared to new leases executed in the prior year is due to the signing of a new anchor tenant lease at our Jamestown Buffalo Mall property in fiscal year 2014. In June of 2013, we executed a ten year lease with an effective date of August 1, 2013 for 84,338 square feet with a new anchor tenant at an average effective rent of $2.75 per square foot. This space was vacated by the former anchor tenant, which was paying $1.70 per square foot at the time their lease expired on May 31, 2013. Absent this transaction, the average effective rental rate for leases executed in our retail segment in fiscal year 2014 would have been $11.72 per square foot. The increase in the average effective rental rate of new leases executed in the total commercial portfolio in fiscal year 2015 when compared to the prior year is primarily due to the Jamestown Buffalo Mall lease mentioned above and the fact that there were no industrial leases executed in fiscal year 2015.

23

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

COMMERCIAL LEASING SUMMARY (Same-Store Properties)

Lease Renewals

The following table summarizes our lease renewal activity within our same-store commercial segments (square feet data in thousands):

Three Months Ended April 30, 2015 and 2014

	Square Feet of Leases Renewed(1)				Percent of Expiring Leases Renewed(2)						Average Term in Years				Weighted Average Growth (Decline) in Effective Rents(3)						Estimated Tenant Improvement Cost per Square Foot(1)				Leasing Commissions per Square Foot(1)
	2015		2014		2015			2014			2015		2014		2015			2014			2015		2014		2015		2014
Office		90,766		89,038		93.4	%		43.0	%		3.3		2.8		6.2	%		(3.1	%)	$	1.96	$	5.13	$	1.34	$	3.59
Healthcare		1,270		5,971		72.9	%		22.1	%		3.0		2.9		(0.1	%)		3.6	%		0		0		3.15		0
Industrial		9,702		0		0	%		100.0	%		2.0		0		11.4	%		0	%		0		0		0.38		0
Retail		74,769		45,629		93.8	%		100.0	%		3.2		3.2		(0.1	%)		4.9	%		0		0		0.96		0.14
Total		176,507		140,638		92.0	%		50.1	%		3.2		3.0		4.1	%		(1.2	%)	$	1.01	$	3.25	$	1.14	$	2.32

(1) The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP.  Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions are based on square feet leased during the period.

(2) Renewal percentage of expiring leases is based on square footage of renewed leases and not the number of leases renewed. Beginning in the first quarter of fiscal year 2015, the category of renewed leases does not include leases that have become month-to-month leases; these month-to-month leases are considered lease amendments. Previous-period data has been revised to reflect this change.

(3) Represents the percentage change in effective rent between the original leases and the renewal leases. Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.

Twelve Months Ended April 30, 2015 and 2014

	Square Feet of Leases Renewed(1)				Percent of Expiring Leases Renewed(2)						Average Term in Years				Weighted Average Growth (Decline) in Effective Rents(3)						Estimated Tenant Improvement Cost per Square Foot(1)				Leasing Commissions per Square Foot(1)
	2015		2014		2015			2014			2015		2014		2015			2014			2015		2014		2015		2014
Office		421,006		311,836		72.6	%		50.8	%		2.8		3.4		9.6	%		(2.6	%)	$	2.29	$	4.82	$	1.52	$	3.39
Healthcare		109,661		40,967		73.2	%		91.4	%		5.8		3.3		(3.5	%)		8.0	%		10.87		8.51		1.56		0.94
Industrial		39,697		251,831		0.0	%		45.6	%		2.5		3.2		(2.1	%)		7.5	%		0		0.32		1.01		0.48
Retail		257,707		123,886		57.1	%		40.2	%		3.7		3.6		18.3	%		8.9	%		1.33		1.19		0.30		0.08
Total		828,071		728,520		67.7	%		50.8	%		3.6		3.4		8.0	%		1.9	%	$	3.01	$	2.85	$	1.12	$	1.68

(1) The leasing activity presented is based on leases signed or executed for our same-store rental properties during the period and is not intended to coincide with the commencement of rental revenue in accordance with GAAP.  Prior periods reflect amounts previously reported and exclude retroactive adjustments for properties reclassified to discontinued operations or non-same-store in the current period. Tenant improvements and leasing commissions are based on square feet leased during the period.

(2) Renewal percentage of expiring leases is based on square footage of renewed leases and not the number of leases renewed. Beginning in the first quarter of fiscal year 2015, the category of renewed leases does not include leases that have become month-to-month leases; these month-to-month leases are considered lease amendments. Previous-period data has been revised to reflect this change.

(3) Represents the percentage change in effective rent between the original leases and the renewal leases. Effective rents represent average annual base rental payments, on a straight-line basis for the term of each lease, excluding operating expense reimbursements. The underlying leases contain various expense structures including gross, modified gross, net and triple net.

The decrease in the percentage of expiring leases renewed in our commercial industrial segment in the three months ended April 30, 2015 and in the twelve months ended April 30, 2015 when compared to the same period in the prior fiscal year is due to the fact that there were no leases expiring in fiscal year 2015.

The increase in the weighted average growth in effective rents for the retail segment in the twelve months ended April 30, 2015 when compared to the same period in the prior fiscal year is due to a 47,150 square foot lease renewal executed at our Rochester, Minnesota Maplewood Square property and a 36,752 square foot lease renewal at our St. Cloud Westgate property.  The increase in the rental rate at our Rochester, Minnesota property was primarily due to the improved financial condition of the tenant which enabled IRET to renew the lease at fair market rental rates.  The lease renewal at our St. Cloud, Minnesota property contained a significant tenant improvement allowance negotiated by the tenant which enabled IRET to negotiate an increased rental rate as well.  Absent these two lease transactions, the weighted average growth rate in effective rents for the retail segment for the twelve months ended April 30, 2015 would have been 6.4%.

24

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

COMMERCIAL LEASING SUMMARY (Same-Store Properties)

Lease Expirations

Our ability to maintain and improve occupancy rates, and base rents, primarily depends upon our continuing ability to re-lease expiring space. The following table reflects the in-service portfolio lease expiration schedule of our consolidated commercial segments properties, including square footage and annualized base rent for expiring leases, as of April 30, 2015.

Fiscal Year of Lease Expiration	# of Leases		Square Footage of Expiring Leases(3)		Percentage of Total Commercial Segments Leased Square Footage			Annualized Base Rent of Expiring Leases at Expiration(2)		Percentage of Total Commercial Segments Annualized Base Rent
2016(1)		166		1,228,799		14.8	%	$	14,724,258		13.1	%
2017		142		1,211,526		14.6	%		19,243,120		17.1	%
2018		101		724,033		8.7	%		11,485,971		10.2	%
2019		90		1,273,808		15.4	%		17,987,792		16.0	%
2020		61		675,357		8.2	%		8,179,205		7.3	%
2021		54		463,342		5.6	%		6,832,314		6.1	%
2022		49		1,408,667		17.0	%		17,928,424		15.9	%
2023		16		499,626		6.0	%		2,533,159		2.3	%
2024		42		384,820		4.7	%		5,963,158		5.3	%
2025		13		198,574		2.4	%		2,847,879		2.5	%
Thereafter		11		218,325		2.6	%		4,701,895		4.2	%
Totals		745		8,286,877		100.0	%	$	112,427,175		100.0	%

(1) Includes month-to-month leases. As of April 30, 2015month-to-month leases accounted for 357,422 square feet.

(2) Annualized Base Rent is monthly scheduled rent as of April 1, 2015, multiplied by 12.

(3) Assuming that none of the tenants exercise renewal or termination options, and including leases renewed prior to expiration. Also excludes 140,022 square feet of space occupied by IRET, of which 98,174 square feet is income producing real estate operated within a Taxable REIT Subsidiary.

Because of the diverse property types in the Company’s commercial portfolio and the dispersed locations of a substantial portion of the portfolio’s properties in secondary and tertiary markets, information on current market rents is difficult to obtain, is highly subjective, and is often not directly comparable between properties. As a result, the Company believes that the increase or decrease in effective rent on its recent leases is the most objective and meaningful information available regarding rent trends and the relationship between rents on leases expiring in the near-term and current market rents across the Company’s markets. The Company believes that rents on its new and renewed leases generally approximate market rents.

25

REAL ESTATE TRUST AND SUBSIDIARIES

10 LARGEST COMMERCIAL TENANTS – BASED ON ANNUALIZED BASE RENT⁽¹⁾

as of April 30, 2015

Tenant	Number of Properties		Average Remaining Lease Term in Months		% of Total Commercial Segments’ Minimum Rents			Aggregate Rentable Square Feet		% of Aggregate Occupied Square Feet
Affiliates of Edgewood Vista		33		65		15.1	%		1,521,147		18.3	%
Fairview Health Services		10		37		4.0	%		256,609		3.1	%
St. Luke’s Hospital of Duluth, Inc.		6		31		3.7	%		198,775		2.4	%
Applied Underwriters		3		22		2.6	%		141,724		1.7	%
HealthEast Care System		1		46		1.8	%		114,316		1.4	%
Microsoft (NASDAQ: MSFT)		1		44		1.5	%		122,040		1.5	%
Arcadis Corporate Services, Inc.		1		15		1.4	%		71,430		0.9	%
Nebraska Orthopaedic Hospital(2)		1		167		1.4	%		61,758		0.7	%
State of Idaho Department of Health and Welfare		2		34		1.2	%		103,342		1.2	%
Affiliates of Siemens USA (NYSE: SI)		1		18		1.2	%		78,360		0.9	%
Total/Weighted Average				48		33.9	%		2,669,501		32.1	%

(1) See Definitions on page 32.

(2) The tenant in the Company’s Nebraska Orthopaedic Hospital property has exercised its option to purchase the property. The Company and its tenant are currently engaged in an arbitration proceeding pursuant to the lease agreement to determine the purchase price.The Company currently can give no assurance that the sale of the property pursuant to the purchase option will be completed.

26

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

COMMERCIAL LEASE EXPIRATIONS

 as of April 30, 2015

	(dollars in thousands except average rental rates)
Fiscal Year	Number of Leases		Rentable Square Feet(1)		% of Rentable Square Feet			Annualized Rent(2)		Average Rental Rate		% of Annualized Base Rent
Office
2016(3)		67		462,010		13.4	%	$	6,215	$	13.45		12.1	%
2017		74		839,492		24.3	%		14,261		16.99		27.9	%
2018		54		463,499		13.4	%		6,537		14.10		12.8	%
2019		51		883,177		25.6	%		12,745		14.43		24.9	%
2020		31		367,590		10.7	%		4,670		12.70		9.1	%
2021 and thereafter		48		435,423		12.6	%		6,779		15.57		13.2	%
		325		3,451,191		100.0	%	$	51,207	$	14.84		100.0	%
Healthcare
2016(4)		49		465,396		16.5	%	$	6,515	$	14.00		13.9	%
2017		30		156,931		5.5	%		3,313		21.11		7.1	%
2018		19		167,999		5.9	%		4,145		24.67		8.8	%
2019		15		192,457		6.8	%		3,962		20.59		8.4	%
2020		11		64,130		2.3	%		1,305		20.35		2.8	%
2021 and thereafter		97		1,779,322		63.0	%		27,724		15.58		59.0	%
		221		2,826,235		100.0	%	$	46,964	$	16.62		100.0	%
Industrial
2016(5)		2		208,401		20.4	%	$	1,131	$	5.43		22.3	%
2017		1		69,600		6.8	%		374		5.37		7.4	%
2018		1		9,702		0.9	%		58		5.98		1.2	%
2019		6		157,595		15.5	%		834		5.29		16.5	%
20120		1		101,567		10.0	%		593		5.84		11.7	%
2021 and thereafter		4		473,246		46.4	%		2,071		4.38		40.9	%
		15		1,020,111		100.0	%	$	5,061	$	4.96		100.0	%
Retail
2016(6)		48		92,992		9.4	%	$	863	$	9.28		9.4	%
2017		37		145,503		14.7	%		1,295		8.90		14.1	%
2018		27		82,833		8.4	%		746		9.01		8.1	%
2019		18		40,579		4.1	%		447		11.02		4.9	%
2020		18		142,070		14.3	%		1,611		11.34		17.5	%
2021 and thereafter		36		485,363		49.1	%		4,233		8.72		46.0	%
		184		989,340		100.0	%	$	9,195	$	9.29		100.0	%
Commercial Total
2016(7)		166		1,228,799		14.8	%	$	14,724	$	11.98		13.1	%
2017		142		1,211,526		14.6	%		19,243		15.88		17.1	%
2018		101		724,033		8.7	%		11,486		15.86		10.2	%
2019		90		1,273,808		15.4	%		17,988		14.12		16.0	%
20120		61		675,357		8.2	%		8,179		12.11		7.3	%
2021 and thereafter		185		3,173,354		38.3	%		40,807		12.86		36.3	%
		745		8,286,877		100.0	%	$	112,427	$	13.57		100.0	%

(1) Excludes 140,022 square feet of space occupied by IRET, of which 98,174 square feet is income producing real estate operated within a Taxable REIT Subsidiary.

(2) Annualized Base Rent is monthly scheduled rent as of April 1, 2015 (cash basis), multiplied by 12.

(3) Includes month-to-month leases.  As of April 30, 2015 month-to-month leases accounted for 15,567 square feet.

(4) Includes month-to-month leases.  As of April 30, 2015 month-to-month leases accounted for 305,405 square feet.

(5) The Industrial segment has no month-to-month leases in place as of April 30, 2015.

(6) Includes month-to-month leases.  As of April 30, 2015 month-to-month leases accounted for 36,450 square feet.

(7) Includes month-to-month leases.  As of April 30, 2015 month-to-month leases accounted for 357,422 square feet.

27

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

FISCAL 2015 ACQUISITION SUMMARY

as of April 30, 2015

(dollars in thousands)

Property

Location

Property Type

Acquisition Date

Rentable Square Feet/Units

Occupancy At Acquisition

April 30, 2015 Occupancy

Acquisition Cost

Creekside Crossing

Bismarck, ND

Unimproved Land

May 22, 2014

n/

a

n/

a

n/

a

$

4,269

Homestead Garden

Rapid City, SD

Multi-Family Residential

June 2, 2014

152

96.7

%

94.7

%

15,000

Silver Springs

Rapid City, SD

Multi-Family Residential

June 2, 2014

52

98.0

%

98.1

%

3,280

PrairieCare Medical

Brooklyn Park, MN

Unimproved Land

June 5, 2014

n/

a

n/

a

n/

a

2,616

71 France Phase I(1)

Edina, MN

Unimproved Land

June 12, 2014

n/

a

n/

a

n/

a

1,413

Northridge(2)

Bismarck, ND

Multi-Family Residential

September 12, 2014

68

55.9

%

95.6

%

8,500

Monticello 7th Addition

Monticello, MN

Unimproved Land

October 9, 2014

n/

a

n/

a

n/

a

1,660

71 France Phase II & III(1)

Edina, MN

Unimproved Land

November 4, 2014

n/

a

n/

a

n/

a

3,309

Minot 1525 24th Ave SW

Minot, ND

Unimproved Land

December 23,2014

n/

a

n/

a

n/

a

1,250

Legacy Heights(2)

Bismarck, ND

Multi-Family Residential

March 19,2015

40

30.0

%

42.5

%

15,000

Total Square Feet

0

$

56,297

Total Units

312

(1) Land is owned by a joint venture in which the Company will have an approximately 52.6% interest after the development project is completed. The joint venture is consolidated in IRET’s financial statements.

(2) Newly constructed project was purchased from developer and was still in lease-up at time of acquisition.

28

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

FISCAL 2015 DEVELOPMENT PLACED IN SERVICE SUMMARY

as of April 30, 2015

(dollars in thousands)

Property(1)	Location	Segment Type	Date Placed in Service	Rentable Square Feet/Units		Occupancy At Date Placed in Service			April 30, 2015 Occupancy			Development Cost
Dakota Commons	Williston, ND	Multi-Family Residential	July 15, 2014		44		40.9	%		95.5	%	$	10,419
Commons at Southgate(2)	Minot, ND	Multi-Family Residential	December 9, 2014		233		75.1	%		92.7	%		35,042
Minot Southgate Wells Fargo Bank	Minot, ND	Retail	November 10, 2014		4,998		100	%		100	%		3,186
Cypress Court II(3)	St. Cloud, MN	Multi-Family Residential	January 1, 2015		64		50.0	%		96.9	%		6,767
Arcata	Golden Valley, MN	Multi-Family Residential	January 1, 2015		165		9.1	%		20.0	%		31,728
Red 20(4)	Minneapolis, MN	Multi-Family Residential	November 21, 2014		130		29.2	%		75.4	%		28,312
Roseville 3075 Long Lake Road	Roseville, MN	Industrial	February 2, 2015		22,807		5.0	%		5.0	%		9,036
			Total Square Feet		27,805							$	124,490
			Total Units		636

(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 Development In Progress Summary for additional information on the Renaissance Heights project, which was partially placed in service during the fiscal year 2014 and the twelve months ended April 30, 2015.

(2) The Company is currently an approximately 52.9% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.

(3) The Company is an approximately 86.1% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.

(4) The Company is an approximately 58.6% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity. The anticipated total cost includes approximately 10,625 square feet of retail space.

29

INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

FISCAL 2015 DEVELOPMENT IN PROGESS SUMMARY

as of April 30, 2015

(dollars in thousands)

						(in thousands)
Project Name and Location	Planned Segment	Rentable Square Feet or Number of Units	Percentage Leased or Committed			Anticipated Total Cost			Costs as of April 30, 2015(1)		Anticipated Construction Completion
Chateau II - Minot, ND	Multi-Family Residential	72 units		13.9	%		14,711			13,129	1Q 2016
Edina 6565 France SMC III - Edina, MN	Healthcare	57,479 sq ft		24.2	%		36,752			22,549	1Q 2016
Minot Southgate Retail - Minot, ND	Retail	7,963 sq ft		0	%		2,923			2,164	1Q 2016
Renaissance Heights - Williston, ND(2)	Multi-Family Residential	288 units		44.5	%		62,362			59,087	1Q 2016
Deer Ridge – Jamestown, ND	Multi-Family Residential	163 units		8.6	%		24,519			15,355	2Q 2016
PrairieCare Medical - Brooklyn Park, MN	Healthcare	72,895 sq ft		100	%		24,251			19,457	2Q 2016
Cardinal Point - Grand Forks, ND	Multi-Family Residential	251 units		18.3	%		40,042			26,450	2Q 2016
71 France Phases I, II, & III - Edina, MN(3)	Multi-Family Residential	241 units		6.2	%		73,290			35,137	1Q 2017
Other	n/a	n/a		n/	a		n/	a		6,618	n/a
						$	278,850		$	199,946

(1) Includes costs related to development projects that are placed in service in phases (Renaissance Heights - $46.0 million).

(2) The Company is an approximately 70% partner in the joint venture entity constructing this project; the anticipated total cost amount given is the total cost to the joint venture entity.

(3) The project will be constructed in three phases by a joint venture entity in which the Company has an approximately 52.6% interest. The anticipated total cost amount given is the total cost to the joint venture entity. The anticipated total cost includes approximately 21,772 square feet of retail space.

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INVESTORS REAL ESTATE TRUST AND SUBSIDIARIES

ACQUISITIONS AND DEVELOPMENT LIQUIDITY PROFILE

as of April 30, 2015

(in millions)

Sources of Liquidity			Liquidity Needs
Liquidity Source	Amount		Liquidity Need	Amount
Cash on balance sheet as of 04/30/15(1)	$	49	Acquisitions(4)	$	16
Line of credit availability(2)	$	30	Development(5)	$	8
Disposition proceeds(3)	$	7
Estimated new debt on Acquisitions(4)	$	10
Total Potential Liquidity	$	96	Total Liquidity Needs	$	24
Excess Liquidity / (Need)	$	72
Capital Sources
FY2015			FY2014
Capital Source	Proceeds Generated		Capital Source	Proceeds Generated
Sale of common shares under dividend reinvestment and share purchase plan	$	49	Sale of common shares under dividend reinvestment and share purchase plan	$	41
Proceeds from sales of real estate and discontinued operations	$	74	Proceeds from sales of real estate and discontinued operations	$	80
Total Capital Generated	$	123	Total Capital Generated	$	121

(1) Includes compensating balances of $14 million.

(2) Line of credit of $90 million less $60 million drawn as of 04/30/15.

(3) Disposition proceeds consists of $7 million of estimated gross proceeds, less estimated outstanding debt and estimated closing costs of $0 million from closed and pending sales for the period from 04/30/15 through 06/29/15. No assurances can be given that pending transactions will be completed on terms currently proposed, or at all.

(4) Acquisitions amount consists of estimated gross costs for closed and pending acquisitions for the period from 04/30/15 through 06/29/15. No assurances can be given that pending transactions will be completed on terms currently proposed, or at all.  Assumes new acquisitions will be leveraged at 65%.

(5) Development in progress of $279 million less construction loans closed or committed of $145 million = IRET equity required of $134 million. IRET equity required of $134 million less $126 million invested as of 04/30/15 = amount remaining to be invested of $8 million.

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Definitions

April 30, 2015

Adjusted EBITDAis earnings before interest, taxes, depreciation, amortization, gain/loss on sale of real estate and other investments, impairment of real estate investments, gain/loss on extinguishment of debt and gain/loss from involuntary conversion. We consider Adjusted EBITDA to be an appropriate supplemental performance measure because it permits investors to view income from operations without the effect of depreciation, the cost of debt, or non-operating gains and losses. Adjusted EBITDA is a non-GAAP measure. Adjusted EBITDA as calculated by us is not comparable to Adjusted EBITDA reported by other REITs that do not define Adjusted EBITDA exactly as we do.

Adjusted funds from operations (AFFO) is calculated by subtracting from Funds from operations (FFO) (1) tenant improvements and leasing costs at same-store properties, and recurring capital expenditures that are capitalized and amortized and are necessary to maintain our properties and revenue stream and (2) straight line rents, then adding (3) non-real estate depreciation and amortization and (4) share-based compensation expense. We may also subtract from FFO certain unusual non-recurring items that do not produce cash available for distribution to shareholders. Our calculation subtracts from FFO leasing commissions and tenant improvements at same-store properties only, since we consider tenant improvement and leasing cost levels at non-same-store properties unrepresentative of expected levels at same-store properties. Previously-reported AFFO amounts are not revised for changes in the composition of the same-store properties pool. AFFO is included herein because we consider it to be a measure of a REIT's ability to incur and service debt and to pay distributions to its shareholders. AFFO is a non-GAAP and non-standardized measure, and may be calculated differently by other REITs.

Annualized base rent (ABR) is calculated as monthly base rent (cash basis) per the lease, as of the reporting period, multiplied by 12.

Debt to total market capitalization is total debt from the balance sheet divided by the sum of total debt from the balance sheet plus the market value of shares outstanding at the end of the period.

Debt service coverage ratio is computed by dividing Adjusted EBITDA by interest expense and principal amortization.

Funds from operations (FFO) - The National Association of Real Estate Investment Trusts, Inc. (NAREIT) defines FFO as “net income (computed in accordance with generally accepted accounting principles, excluding gains (or losses) from sales of property, plus real estate depreciation and amortization, and adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis.” In addition, in October 2011 NAREIT clarified its computation of FFO to exclude impairment charges for all periods presented. FFO is a non-GAAP measure.  We consider FFO, which is a standard supplemental measure for equity real estate investment trusts, helpful to investors because it facilitates an understanding of the operating performance of properties without giving effect to impairment write-downs and to real estate depreciation and amortization, which assumes that the value of real estate assets diminishes predictably over time.  Since real estate values instead historically rise or fall with market conditions, we believe that FFO provides investors and management with a more accurate indication of our financial and operating results.

Net Operating Income (NOI) is total real estate revenues and gain on involuntary conversion less real estate expenses (which consist of utilities, maintenance, real estate taxes, insurance and property management expenses).  We believe that NOI is an important supplemental measure of operating performance for a REIT’s operating real estate because it provides a measure of core operations that is unaffected by depreciation, amortization, financing and general and administrative expense. NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income, net income available for common shareholders or cash flow from operating activities as a measure of financial performance.

Payout ratio (FFO per share and unit basis) - The ratio of the current quarterly or annual distribution rate per common share and unit divided by quarterly or annual FFO per share and unit.

Ratio of earnings to fixed charges - The ratio of earnings to fixed charges is computed by dividing earnings by fixed charges. For this purpose, earnings consist of income from continuing operations plus fixed charges and preferred distributions, less adjustments for noncontrolling interests - consolidated real estate entities, capitalized interest and preferred distributions. Fixed charges consist of mortgage and loan interest expense, whether expensed or capitalized, the amortization of debt expense and capitalized interest.

Ratio of earnings to combined fixed charges and preferred distributions - The ratio of earnings to combined fixed charges and preferred distributions is computed by dividing earnings by combined fixed charges and preferred distributions. For this purpose, earnings consist of income from continuing operations plus fixed charges and preferred distributions, less adjustments for noncontrolling interests - consolidated real estate entities, capitalized interest and preferred distributions. Combined fixed charges and preferred distributions consist of fixed charges (mortgage and loan interest expense, whether expensed or capitalized, the amortization of debt expense and capitalized interest) and preferred distributions.

Recurring capital expenditures are expenditures (excluding capital expenditures recoverable from tenants and capital expenditures at properties sold during the period) made on a regular or recurring basis to maintain a property’s competitive position within its market, generally with a depreciable life of 5 to 12 years, but excluding (a) capital expenditures made in the year of acquisition and in subsequent periods until the property is classified as same-store (i.e., excluding capital expenditures on non-same-store properties), (b) improvements associated with the expansion or re-development of a building, (c) renovations to a building which change the underlying classification of the building (for example, from industrial to office or Class C office to Class A office) or (d) capital improvements that represent the addition of something new to a property, rather than the replacement of an existing item.

Scheduled rent revenue is the total possible revenue from all leasable units and square footage, with occupied space valued at contract rates pursuant to leases and vacant units or square footage at market rates.

Same-store properties are properties owned or in service for the entirety of the periods being compared (except for properties for which significant redevelopment or expansion occurred during either of the periods being compared, and properties sold or classified as held for sale), and, in the case of development or re-development properties, which have achieved a target level of occupancy of 90% for multi-family residential properties and 85% for office, healthcare, industrial and retail properties.

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