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

Date of Report (Date of earliest event reported): March 31, 2008

INCOME OPPORTUNITY REALTY INVESTORS, INC.

(Exact Name of Registrant as Specified in its Charter)

Nevada	001-14784	75-2615944
(State or other jurisdiction of incorporation)	(Commission File No.)	(I.R.S. Employer Identification No.)

1755 Wittington Place, Suite 340
Dallas, Texas	75234
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code 214-750-5800  

     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:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2 — Financial Information

Item 2.02. Results of Operations and Financial Condition

     On March 31, 2008, Income Opportunity Realty Investors, Inc. (“IOT” or the “Company”) announced its operational results for the fiscal year ended December 31, 2007. A copy of the announcement is attached as Exhibit “99.1.”

     The information furnished pursuant to Item 2.02 in this Form 8-K, including Exhibit “99.1” attached hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, unless we specifically incorporate it by reference in a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934. We undertake no duty or obligation to publicly-update or revise the information furnished pursuant to Item 2.02 of this Current Report on Form 8-K.

Section 9 — Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits

     (d) Exhibits.

     The following exhibit is furnished with this Report:

Exhibit
Designation	Description of Exhibit
99.1*		Press Release dated March 31, 2008.

* Furnished herewith.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly-caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly-authorized.

Dated: April 1, 2008	INCOME OPPORTUNITY REALTY INVESTORS, INC.
	By:	/s/ Gene S. Bertcher
		Gene S. Bertcher, Executive Vice
		President and Interim Chief Financial Officer

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EX-99.1

EXHIBIT 99.1

NEWS RELEASE

FOR IMMEDIATE RELEASE	Contact:
	Income Opportunity Realty Investors, Inc.
	Investor Relations
	(800) 400-6407
	investor.relations@primeasset.com

Income Opportunity Realty Investors, Inc. Reports Fourth Quarter 2007 Results

DALLAS (March 31, 2008) Income Opportunity Realty Investors, Inc. (AMEX: IOT), a Dallas-based real estate investment company, today reported net income for the year ended December 31, 2007. The Company is aware of the challenges that are currently facing the real estate industry. Despite these issues, given the quality of the underlying assets and our attention to details, management remains highly focused on its operations, development projects and investment strategy.

     IOT today reported net loss applicable to common shares of ($735,000) or ($.18) per share for the twelve months ended December 31, 2007 as compared to a net income applicable to common share of $172,000 or $.04 per share for the same period ended 2006.

     In addition, income applicable to common shares for the three months ended December 31, 2007 was ($18,000) or ($.01) per share as compared to a net loss applicable to common share of ($258,000) or ($.07) per share for the same period ended 2006.

     Subsequent to year end on January 25, 2008, we sold six apartment complexes, totaling 621 units which were all located in Midland, Texas, for an aggregate sales price of $49.6 million. We received $20.7 million in cash after paying off $25.0 million in debt and related closing costs. We recorded a gain of sale of $31.0 million upon the sale of these properties.

     Results for the twelve months ended December 31, 2007

     Rental income increased from $2.0 million in 2006 to $2.3 million in 2007. an increase of $300,000 due to the acquisition of Falcon Point in March of 2006.

     Property operations expense increased from $1.5 million in 2006 to $1.9 million in 2007, an increase of $400,000 due to the acquisition of Falcon Point apartments in March of 2006.

     Advisory fees increase from $496,000 in 2006 to $1.0 million in 2007 due to the purchase of Falcon Point and Travelers land in 2006, as the total assets are a component of the advisory fee.

     Interest income increased from $3.4 million in 2006 to $4.7 million in 2007, an increase of $1.3 million due to the transfer of $6.1 million to the advisor in the current year and the additional income received from interest. Per the management agreement, the advisor receives excess cash which pays interest at prime plus 1%.

     Income from discontinued operations decreased from $649,000 in 2006 as compared to $37,000 in 2007 due to refinancing two mortgages in 2007, which increased the debt obligation by $8.3 million and the associate interest expense.

     Results for the three months ended December 31, 2007

     Rental income was $558,000 for the quarter ended December 31, 2006 as compared to $474,000 for the same period ended 2007, a decrease of $91.000. The decrease was due to overall lower occupancies.

     Property operations expense increased from $565,000 for the three months ended 2006 to $1.2 million for the same period ended 2007, an increase of approximately $600,000. The increase is due to an increase in maintenance costs and improvements to the properties.

     Other income increased from a loss of ($402,000) for the fourth quarter ended 2006 to an income of $556_,000 for the same period ended 2007, an increase of $958,000. The increase is due to the interest income from the transfer of $6.1 million dollars to the advisor.

     Income from discontinued was $225,000 for the fourth quarter ended 2006 as compared to $56.000 for the same period ended 2007 a decrease of $169,000. The decrease is due to the net effect of repositioning 6 apartments with declining revenues to held for sale in the current year. These properties were sold subsequent to year-end.

     Income Opportunity Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of equity real estate in Texas, including office buildings, apartments and undeveloped land. For more information, go to IOT’s website at www.incomeopp-realty.com.

INCOME OPPORTUNITY REALTY INVESTORS, INC.
CONSOLIDATED BALANCE SHEETS

	December 31,			December 31,
	2007			2006
	(dollars in thousands)
Assets
Real estate held for investment	$	43,027		$	63,682
Less—accumulated depreciation		(2,456	)		(5,061	)
		40,571			58,621
Real estate held for sale		17,032			—
Notes and interest receivable		27,441			27,777
Investment in real estate partnerships		532			515
Cash and cash equivalents		267			80
Receivables from affiliates		27,801			17,766
Other assets		2,663			4,152
	$	116,307		$	108,911
Liabilities and Stockholders’ Equity
Liabilities:
Notes and interest payable	$	44,354		$	61,546
Liabilities related to assets held for sale		25,152			—
Other liabilities		2,057			1,921
		71,563			63,467
Commitments and contingencies		—			—
Minority interest		677			605
Stockholders’ equity:
Common Stock, $.01 par value, authorized 10,000,000 shares; issued and outstanding 4,162,774 and 4,168,035 shares in 2007 and in 2006, respectively.		42			42
Treasury stock		(37	)		—
Paid-in capital		61,955			61,955
Accumulated deficit		(17,893	)		(17,158	)
		44,067			44,839
	$	116,307		$	108,911