UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

ý Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, ~~2017~~2018

o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number 001-07172

BRT APARTMENTS CORP.

(Exact name of Registrant as specified in its charter)



Maryland		13-2755856
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)



60 Cutter Mill Road, Great Neck, NY		11021
(Address of principal executive offices)		(Zip Code)

516-466-3100

(Registrant’s telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “small reporting company” in Rule 12b-2 of the Exchange Act. (Check one):



Large accelerated filer o		Accelerated filer ý
Non-accelerated filer o		Smaller reporting company o
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405) of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

o Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

Indicate the number of shares outstanding of each of the issuer’s classes of stock, as of the latest practicable date.

~~14,040,560~~14,343,201 Shares of Common Stock,

par value $0.01 per share, outstanding on May ~~5, 2017~~8, 2018

BRT APARTMENTS CORP. AND SUBSIDIARIES

Table of Contents



Part I - Financial Information		Page No.
Item 1.	Financial Statements
	Consolidated Balance Sheets - March 31, ~~2017~~2018 (unaudited) and September 30, ~~2016~~2017	2
	Consolidated Statements of Operations – Three and six months ended March 31, ~~2017~~2018 and ~~2016~~2017 (unaudited)	3
	Consolidated Statements of Comprehensive Income (Loss) ~~Income~~ – Three and six months ended March 31, ~~2017~~2018 and ~~2016~~2017 (unaudited)	4
	Consolidated Statement of Equity – Six months ended March 31, ~~2017~~2018 (unaudited)	5
	Consolidated Statements of Cash Flows – Six months ended March 31, ~~2017~~2018 and ~~2016~~2017 (unaudited)	6
	Notes to Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2218

Item 3.	Quantitative and Qualitative Disclosures About Market Risks	3127

Item 4.	Controls and Procedures	3127

Part II – Other Information
Item 2.	~~Unregistered Sales of Equity Securities and Use of Proceeds~~	32

~~Item~~ 6.	Exhibits	3328

Table of Contents

Part I ‑ FINANCIAL INFORMATION

Item 1. Financial Statements

BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)



	March 31, 2017 (Unaudited)			September 30, 2016			March 31, 2018 (Unaudited)			September 30, 2017
ASSETS
Real estate properties, net of accumulated depreciation and amortization of $53,143 and $41,995	$	781,114		$	759,576
Real estate properties, net of accumulated depreciation and amortization of $67,643 and $64,290							$	993,250		$	902,281
Real estate loan	5,900			19,500			5,200			5,500
Cash and cash equivalents	43,147			27,399			30,974			12,383
Restricted cash	6,619			7,383			7,702			6,151
Deposits and escrows	13,101			18,972			23,655			27,839
Investments in unconsolidated joint ventures	14,557			298			20,845			21,415
Other assets	6,082			7,775			7,005			9,359
Real estate properties held for sale	—			33,996
Real estate property held for sale							—			8,969
Total Assets(a)	$	870,520		$	874,899		$	1,088,631		$	993,897
LIABILITIES AND EQUITY
Liabilities:
Mortgages payable, net of deferred costs of $5,296 and $5,873	$	603,133		$	588,457
Junior subordinated notes, net of deferred costs of $392 and $402	37,008			36,998
Mortgages payable, net of deferred costs of $6,550 and $6,345							$	743,225		$	697,826
Junior subordinated notes, net of deferred costs of $372 and $382							37,028			37,018
Accounts payable and accrued liabilities	13,467			20,716			17,002			22,348
Mortgage payable held for sale	—			27,052
Total Liabilities	653,608			673,223
Total Liabilities (a)							797,255			757,192

Commitments and contingencies
Equity:
BRT Apartments Corp. stockholders' equity:
Preferred shares, $.01 par and $1 par value:
Authorized 20,000 and 10,000 shares, none issued	—			—
Preferred shares $.01 par value 2,000 shares authorized, none outstanding							—			—
Common stock, $.01 par value, 300,000 shares authorized;
13,352 shares issued at March 31, 2017	134			—
Shares of Beneficial Interest, $3 par value, number of shares authorized,
unlimited; 13,232 issued at September 30, 2016	—			39,696
13,575 and 13,333 shares outstanding							136			133
Additional paid-in capital	201,546			161,321			203,838			201,910
Accumulated other comprehensive income (loss)	1,518			(1,602		)
Accumulated other comprehensive income							2,132			1,000
Accumulated deficit	(36,584		)	(48,125		)	(10,967		)	(37,047		)
Total BRT Apartments Corp. stockholders’ equity	166,614			151,290			195,139			165,996
Non-controlling interests	50,298			50,386			96,237			70,709
Total Equity	216,912			201,676			291,376			236,705
Total Liabilities and Equity	$	870,520		$	874,899		$	1,088,631		$	993,897

(a)

The Company's consolidated balance sheets include the assets and liabilities of consolidated variable interest entities (VIEs). See note 6. The consolidated balance sheets include the following amounts related to the Company's VIEs as of March 31, 2018 and September 30, 2017, respectively: $625,714 and $707,546 of real estate properties, $9,228 and $8,626 of cash and cash equivalents, $8,632 and $13,873 of deposits and escrows, $5,765 and $8,148 of other assets, $0 and $8,969 of real estate properties held for sale, $479,093 and $558,568 of mortgages payable and $7,550 and $14,419 of accounts payable and accrued liabilities.

See accompanying notes to consolidated financial statements.

Table of Contents

BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

~~(Unaudited)~~(Dollars in thousands, except share data)

Three Months Ended
March 31, Six Months Ended
March 31,

2017 2016 2017 2016
Revenues:
Rental and other revenues from real estate properties $ 24,702
$ 23,993
$ 49,731
$ 46,312
Other income 181
2,026
792
2,033
Total revenues 24,883
26,019
50,523
48,345
Expenses:
Real estate operating expenses - including $641 and $372 to related parties for the three months ended and $1,252 and $804 for the six months ended 11,909
12,097
24,355
23,191
Interest expense - including $0 and $62 to related party for the three months ended and $0 and $86 for the six months ended 6,402
6,049
13,089
11,580
Advisor’s fees, related party —
—
—
693
Property acquisition costs - including $0 and $439 to related parties for the three and six months ended —
953
—
1,010
General and administrative - including $103 and $60 to related parties for the three months ended and $182 and $87 for the six months ended 2,390
2,280
4,987
4,029
Depreciation 7,772
5,632
14,069
10,616
Total expenses 28,473
27,011
56,500
51,119
Total revenue less total expenses (3,590 ) (992 ) (5,977 ) (2,774 )
Gain on sale of real estate —
24,226
35,838
24,835
Loss on extinguishment of debt —
(2,668 ) (799 ) (2,668 )
(Loss) income from continuing operations (3,590 ) 20,566
29,062
19,393
Provision for taxes 1,108
—
1,458
—
(Loss) income from continuing operations, net of taxes (4,698 ) 20,566
27,604
19,393
Discontinued operations:
Loss from discontinued operations —
(1,188 ) —
(2,788 )
Gain on sale of partnership interest —
15,467
—
15,467
Income from discontinued operations —
14,279
—
12,679
Net (loss) income (4,698 ) 34,845
27,604
32,072
Net loss (income) attributable to non-controlling interests 469
(9,909 ) (16,063 ) (9,170 )
Net (loss) income attributable to common stockholders $ (4,229 ) $ 24,936
$ 11,541
$ 22,902
Basic and diluted per share amounts attributable to common stockholders:
(Loss) income from continuing operations $ (0.30 ) $ 0.75
$ 0.83
$ 0.72
Income from discontinued operations —
1.01
—
0.90
Basic and diluted (loss) earnings per share $ (0.30 ) $ 1.76
$ 0.83
$ 1.62
Amounts attributable to BRT Apartments Corp.:
(Loss) income from continuing operations $ (4,229 ) $ 9,957
$ 11,541
$ 8,564
Income from discontinued operations —
14,979
—
14,338
Net (loss) income $ (4,229 ) $ 24,936
$ 11,541
$ 22,902

Weighted average number of common shares outstanding:
Basic and diluted 14,018,099
14,132,235
13,957,706
14,116,560



	Three Months Ended March 31,						Six Months Ended March 31,
	2018			2017			2018			2017
Revenues:
Rental and other revenues from real estate properties	$	29,476		$	24,702		$	57,638		$	49,731
Other income	175			181			362			792
Total revenues	29,651			24,883			58,000			50,523
Expenses:
Real estate operating expenses - including $836 and $641 to related parties for the three months ended and $1,621 and $1,252 for the six months ended	14,198			11,909			27,545			24,355
Interest expense	8,657			6,402			16,637			13,089
General and administrative - including $146 and $103 to related parties for the three months ended and $228 and $182 for the six months ended	2,453			2,390			4,756			4,987
Depreciation	9,240			7,772			17,888			14,069
Total expenses	34,548			28,473			66,826			56,500
Total revenue less total expenses	(4,897		)	(3,590		)	(8,826		)	(5,977		)
Equity in loss of unconsolidated joint ventures	(63		)	—			(88		)	—
Gain on sale of real estate	51,981			—			64,500			35,838
Gain on insurance recovery	3,227			—			3,227			—
Loss on extinguishment of debt	(593		)	—			(850		)	(799		)
Income (loss) from continuing operations	49,655			(3,590		)	57,963			29,062
Income tax (benefit) provision	(253		)	1,108			(147		)	1,458
Net income (loss) from continuing operations, net of taxes	49,908			(4,698		)	58,110			27,604
Net (income) loss attributable to non-controlling interests	(24,686		)	469			(26,537		)	(16,063		)
Net income (loss) attributable to common stockholders	$	25,222		$	(4,229	)	$	31,573		$	11,541

Weighted average number of shares of common stock outstanding:
Basic	14,242,076			14,018,099			14,131,050			13,957,706
Diluted	14,442,076			14,018,099			14,331,050			13,957,706

Per share amounts attributable to common stockholders:
Basic	$	1.77		$	(0.30	)	$	2.23		$	0.83
Diluted	$	1.75		$	(0.30	)	$	2.20		$	0.83

See accompanying notes to consolidated financial statements.

Table of Contents

BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) ~~INCOME~~

(Unaudited)

(Dollars in thousands)

Three Months Ended
March 31, Six Months Ended
March 31,

2017 2016 2017 2016
Net (loss) income $ (4,698 ) $ 34,845
$ 27,604
$ 32,072
Other comprehensive income (loss):
Unrealized gain (loss) on derivative instruments 135
(34 ) 3,403
(14 )
Other comprehensive income (loss) 135
(34 ) 3,403
(14 )
Comprehensive (loss) income (4,563 ) 34,811
31,007
32,058
Comprehensive (loss) income attributable to non-controlling interests (144 ) 9,904
17,387
9,168
Comprehensive (loss) income attributable to common stockholders $ (4,419 ) $ 24,907
$ 13,620
$ 22,890



	Three Months Ended March 31,						Six Months Ended March 31,
	Three Months Ended March 31,						Six Months Ended March 31,
	2018			2017			2018			2017
Net income (loss)	$	49,908		$	(4,698	)	$	58,110		$	27,604
Other comprehensive income:
Unrealized gain on derivative instruments	1,132			135			1,634			3,403
Other comprehensive income	1,132			135			1,634			3,403
Comprehensive income (loss)	51,040			(4,563		)	59,744			31,007
Comprehensive (income) loss attributable to non-controlling interests	(25,032		)	144			(27,039		)	(17,387		)
Comprehensive income (loss) attributable to common stockholders	$	26,008		$	(4,419	)	$	32,705		$	13,620

See accompanying notes to consolidated financial statements.

Table of Contents

BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF EQUITY

Six Months Ended March 31, ~~2017~~2018

(Unaudited)

(Dollars in thousands, except share data)


	Shares of Beneficial Interest			Common Stock		Additional Paid-In Capital			Accumulated Other Comprehensive (Loss) Income			Accumulated Deficit			Non- Controlling Interest			Total			Common Stock		Additional Paid-In Capital			Accumulated Other Comprehensive (Loss) Income		Accumulated Deficit			Non- Controlling Interest			Total
Balances, September 30, 2016	$	39,696		$	—	$	161,321		$	(1,602	)	$	(48,125	)	$	50,386		$	201,676
Balances, September 30, 2017																					$	133	$	201,910		$	1,000	$	(37,047	)	$	70,709		$	236,705
Distributions - common stock - $0.38 per share																					—		—			—		(5,493		)	—			(5,493		)
Restricted stock vesting	375			—		(375		)	—			—			—			—			1		(1		)	—		—			—			—
Compensation expense - restricted stock and restricted stock units	—			—		710			—			—			—			710			—		612			—		—			—			612
Contributions from non-controlling interests	—			—		—			—			—			6,398			6,398			—		—			—		—			22,623			22,623
Consolidation of investment in limited partnership																					—		—			—		—			12,370			12,370
Distributions to non-controlling interests	—			—		—			—			—			(22,832		)	(22,832		)	—		—			—		—			(36,336		)	(36,336		)
Shares repurchased - 5,775 shares	(17		)	—		(30		)	—			—			—			(47		)
Conversion to a Maryland corporation at $.01 par value	(40,054		)	134		39,920			—			—			—			—
Purchase of non-controlling interest																					—		(82		)	—		—			(168		)	(250		)
Shares issued through equity offering program, net																					2		1,399			—		—			—			1,401
Net income	—			—		—			—			11,541			16,063			27,604			—		—			—		31,573			26,537			58,110
Other comprehensive income	—			—		—			3,120						283			3,403			—		—			1,132		—			502			1,634
Comprehensive income	—			—		—			—			—			—			31,007			—		—			—		—			—			59,744
Balances, March 31, 2017	$	—		$	134	$	201,546		$	1,518		$	(36,584	)	$	50,298		$	216,912
Balances, March 31, 2018																					$	136	$	203,838		$	2,132	$	(10,967	)	$	96,237		$	291,376

See accompanying notes to consolidated financial statements.

Table of Contents

BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

~~(Dollars~~ (Dollars in Thousands)


	Six Months Ended March 31,						Six Months Ended March 31,
	2017			2016			2018			2017
Cash flows from operating activities:
Net income	$	27,604		$	32,072		$	58,110		$	27,604
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	14,604			12,943
Depreciation							17,888			14,069
Amortization of deferred borrowing fees							742			535
Amortization of restricted stock and restricted stock units	710			418			613			710
Equity in loss of unconsolidated joint ventures							88			—
Gain on sale of real estate	(35,838		)	(24,835		)	(64,500		)	(35,838		)
Gain on sale of partnership interest	—			(15,467		)
Gain on insurance recovery							(3,227		)	—
Loss on extinguishment of debt	799			2,668			850			799
Effect of deconsolidation of non-controlling interest	—			(1,687		)
Increases and decreases from changes in other assets and liabilities:
Increase in straight-line rent	(36		)	—
Decrease (increase) in interest receivable	2,324			(2,040		)
Decrease in interest receivable							—			2,324
Decrease in deposits and escrows	5,871			3,035			7,745			5,871
Decrease in other assets	1,190			2,480			7,230			1,154
Decrease in accounts payable and accrued liabilities	(5,662		)	(89		)	(5,565		)	(5,662		)
Net cash provided by operating activities	11,566			9,498			19,974			11,566

Cash flows from investing activities:
Collections from real estate loans	13,600			—
Collections from real estate loan							300			13,600
Additions to real estate properties	(60,580		)	(100,148		)	(125,901		)	(60,580		)
Net costs capitalized to real estate properties	(5,430		)	(25,244		)	(5,247		)	(5,430		)
Net change in restricted cash - Newark	—			(1,952		)
Net change in restricted cash - Multi Family	764			(470		)
Proceeds from the sale of real estate properties	128,647			94,602
(Increase) decrease in restricted cash							(1,551		)	764
Investment in limited partnership							(12,370		)	—
Purchase of non-controlling interests							(250		)	—
Consolidation of investment in limited partnership							1,279			—
Net proceeds from the sale of real estate properties							168,691			128,647
Distributions from unconsolidated joint ventures	166			0			482			166
Contributions to unconsolidated joint ventures	(14,394		)	—			—			(14,394		)
Proceeds from the sale of interest in joint venture	—			16,870
Net cash provided by (used in) investing activities	62,773			(16,342		)
Net cash (used in) provided by investing activities							25,433			62,773

Cash flows from financing activities:
Proceeds from mortgages payable	40,363			96,527			78,945			40,363
Increase in other borrowed funds	—			6,001
Mortgage payoffs	(79,215		)	(63,220		)	(84,727		)	(79,215		)
Mortgage principal payments	(2,539		)	(2,591		)	(2,525		)	(2,539		)
Increase in deferred financing costs	(719		)	(1,750		)	(817		)	(719		)
Capital contributions from non-controlling interests	6,398			10,964
Capital distribution to non-controlling interests	(22,832		)	(21,013		)
Proceeds from sale of New Market Tax Credits	—			2,746
Dividends paid							(5,380		)	—
Contributions from non-controlling interests							22,623			6,398
Distributions to non-controlling interests							(36,336		)	(22,832		)
Proceeds from the sale of common stock							1,401			—
Repurchase of shares of beneficial interest/common stock	(47		)	(1,584		)	—			(47		)
Net cash (used in) provided by financing activities	(58,591		)	26,080
Net cash provided by (used in) financing activities							(26,816		)	(58,591		)

Net increase in cash and cash equivalents	15,748			19,236			18,591			15,748
Cash and cash equivalents at beginning of period	27,399			15,556			12,383			27,399
Cash and cash equivalents at end of period	$	43,147		$	34,792		$	30,974		$	43,147

Supplemental disclosure of cash flow information:
Cash paid during the period for interest, net of capitalized interest of $185 and $248 respectively	$	12,536		$	14,181
Taxes paid	$	1,778		$	536
Acquisition of real estate through assumption of debt	$	27,638		$	16,051
Real estate properties reclassified to assets held for sale	$	—		$	32,219

BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED

(Unaudited)

(Dollars in Thousands)



	Six Months Ended March 31,
	2018			2017
Supplemental disclosure of cash flow information:
Cash paid during the period for interest, net of capitalized interest of $0 and $84, respectively	$	15,859		$	12,536
Taxes paid	$	39		1,778
Acquisition of real estate through assumption of debt	$	—		$	27,638

Consolidation of investment in limited partnership:
Increase in real estate assets	$	(72,395	)	$	—
Increase in deposits and escrows	(3,561		)	—
Increase in other assets	(20		)	—
Increase in mortgage payable	53,060			—
Increase in deferred financing costs	(657		)	—
Increase in accounts payable and accrued liabilities	112			—
Increase in non controlling interest	12,370			—
Decrease in investment in limited partnership	12,370			—
Increase in cash upon consolidation of limited partnership	$	1,279		$	—

See accompanying notes to consolidated financial ~~statements.~~statements.

Table of Contents

BRT APARTMENTS CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

March 31, ~~2017~~2018

Note 1 – Organization and Background

BRT Apartments Corp. (the "Company"), a Maryland corporation, ~~is the successor to BRT Realty Trust, a Massachusetts business trust, pursuant to the conversion of BRT Realty Trust into BRT Apartments Corp. on March 18, 2017.~~

~~The Company~~ owns, operates and develops multi‑family ~~properties and owns and operates other assets, including real estate and a real estate loan. BRT~~properties. The Company conducts its operations to qualify as a real estate investment trust, or REIT, for federal income tax purposes.

Generally, the ~~multi‑family~~multi-family properties are acquired with joint venture partners in transactions in which the Company contributes ~~80%~~a significant portion of the equity. At March 31, ~~2017,~~2018, the Company owns: (a) 3234 multi-family properties with ~~8,805~~9,632 units (including 445 units at two properties engaged in lease-up activities and 402 units at a property under development), located in 11 states ~~(including 271 units at a property in the lease up stage)~~ with a ~~net book~~carrying value of ~~$770,555,000;~~$982,801,000; and (b) interests in ~~two~~three unconsolidated multi-family joint ventures with a ~~net book~~carrying value of ~~$14,257,000.~~

The Company also owns and operates various other real estate assets. At March 31, 2017, the net book value of these other real estate assets was $16,459,000, including a real estate loan of $5,900,000.$20,637,000.

Note 2 – Basis of Preparation

The accompanying interim unaudited consolidated financial statements as of March 31, ~~2017,~~2018, and for the three and six months ended March 31, ~~2017~~2018 and ~~2016,~~2017, reflect all normal recurring adjustments which, in the opinion of management, are necessary for a fair presentation of the results for such interim periods. The results of operations for the three and six months ended March 31, ~~2017~~2018 and ~~2016,~~2017, are not necessarily indicative of the results for the full year. The consolidated balance sheet as of September 30, ~~2016,~~2017, has been derived from the audited financial statements at that date but does not include all the information and footnotes required by accounting principles generally accepted in the United States ("GAAP") for complete financial statements.

The consolidated financial statements include the accounts and operations of the Company, its wholly owned subsidiaries, and its majority owned or controlled real estate entities and its interests in variable interest entities ("VIEs") in which the Company is determined to be the primary beneficiary. Material ~~inter-company~~intercompany balances and transactions have been eliminated.

The Company’s consolidated joint ventures that own multi‑family properties were determined to be VIEs because the voting rights of some equity investors in the applicable joint venture entity are not proportional to their obligations to absorb the expected losses of the entity and their right to receive the expected residual returns. ~~In addition, substantially all of the entity’s activities either involve or are conducted on behalf of an investor that has disproportionately fewer voting rights.~~ It was determined that the Company is the primary beneficiary of these joint ventures because it has a controlling interest in that it has the power to direct the activities of the VIE that most significantly impact the entity's economic performance and it has the obligation to absorb losses of the entity and the right to receive benefits that could potentially be significant to the VIE.

The joint ~~venture~~ventures that ~~owns a property~~own properties in Ocoee, FL, Lawrenceville, GA, Dallas, TX ~~was~~and St. Louis, MO were determined not to be a ~~VIE~~VIEs but isare consolidated because the Company has ~~substantive participating~~controlling rights in ~~the entity owning the property.~~such entities.

With respect to its unconsolidated joint ventures, as (i) the Company is primarily the managing member but does not exercise substantial operating control over these entities or the Company is not the managing member and (ii) such entities are not VIEs, the Company has determined that such joint ventures should be accounted for under the equity method of accounting for financial statement purposes.

The distributions to each joint venture partner are determined pursuant to the applicable operating agreement and may not be pro-rata to the percentage equity interest each partner has in the applicable venture.

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For the three and six months ended March 31, 2016, the Company reclassified approximately $1,162,000 and $2,083,000 of tenant utility reimbursements from real estate operating expenses to rental and other revenues from real estate properties to conform with the current period presentation. This reclassification increased total revenues and expenses by $1,162,000 and $2,083,000 respectively, and had no effect on the Company's financial position, results of operations or cash flows.

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements. Actual results could differ from those estimates. Substantially all of the Company's assets are comprised of multi- family real estate assets generally leased to tenants on a one year basis. Therefore, the Company aggregates real estate assets for reporting purposes and operates in one reportable segment.

Note 3 ‑ Equity

Equity Distribution Agreements

On January 11, 2018, the Company entered into equity distribution agreements with three sales agents to sell up to an aggregate of $20,000,000 of its common stock from time-to-time in an at-the-market offering. In the quarter ended March 31, 2018, the Company sold 113,566 shares of common stock for net proceeds of $1,401,000, after giving effect to commissions of

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$30,000 and estimated offering costs (i.e. professional and related fees) of $63,000. From April 1, 2018 through May 8, 2018, the Company sold 62,400 shares of common stock for net proceeds of $734,000, after giving effect to commissions of $16,000.

Common Stock Dividend Distribution

~~During the three and six months ended~~The Company declared a quarterly cash distribution of $0.20 per share, payable on April 6, 2018, to stockholders of record on March ~~31, 2017 and 2016, the Company did not declare a dividend on its shares.~~27, 2018.

Stock Based Compensation

The Company's Amended and Restated ~~2016~~2018 Incentive Plan (the ~~"Plan"~~"2018 Plan") permits the Company to grant: (i) stock options, restricted stock, restricted stock units, performance share awards and any one or more of the foregoing, up to a maximum of 600,000 shares; and (ii) cash settled dividend equivalent rights in tandem with the grant of restricted stock units and certain performance based awards.

Restricted Stock Units

~~Pursuant to the Plan, in~~In June 2016, the Company issued restricted stock units (the "Units") to acquire up to 450,000 shares of common ~~shares~~stock pursuant to the 2016 Amended and Restated Incentive Plan (the ~~"Pay for Performance Program"~~"2016 Incentive Plan") . InThe Units entitle the recipients, subject to continued service through the March 31, 2021 ~~recipients of the Units are entitled~~vesting date, to receive (i) the underlying shares if and to the extent certain performance ~~metrics~~and/or market conditions are satisfied at the vesting date, and (ii) an amount equal to the cash dividends paid from the grant date through the vesting date with respect to the shares of common ~~shares~~stock underlying the Units if, when, and to the extent, the related Units vest. ~~Because~~For financial statement purposes, because the Units are not participating securities, ~~for accounting purposes,~~ the shares underlying the Units are excluded in the outstanding shares reflected on the consolidated balance sheet and from the calculation of basic earnings per share. The shares underlying the Units are contingently issuable shares ~~but~~and 200,000 of these shares have ~~not~~ been included in the diluted earnings per share as the ~~performance and~~ market ~~criteria have not~~conditions with respect to such units had been ~~met.~~met at March 31, 2018.

Expense is recognized over the five year vesting period on the Units which the Company expects to vest. ~~The~~For the three months ended March 31, 2018 and 2017, the Company recorded $73,000 and $110,000, respectively, and for the six months ended March 31, 2018 and 2017, the Company recorded $146,000 and $220,000, respectively, of compensation expense related to the amortization of unearned compensation with respect to the ~~Units in the three and six months ended March 31, 2017.~~Units. At March 31, ~~2017~~2018, and September 30, ~~2016, $1,752,000~~2017, $870,000 and ~~$1,972,000,~~$1,015,000 of compensation expense, respectively, ~~has~~had been deferred and will be charged to expense over the remaining vesting period.

Restricted Stock

In ~~January 2017,~~March 2018, the Company granted ~~147,500~~144,797 shares of restricted stock pursuant to the 2018 Incentive Plan.

As of March 31, ~~2017,~~2018, an aggregate of ~~689,375~~706,247 shares of unvested restricted stock are outstanding pursuant to the ~~2012~~2018 Incentive Plan, 2016 Incentive Plan and ~~the 2009~~2012 Incentive ~~Plan (collectively the "Prior Plans").~~Plan. No additional awards may be granted under the ~~Prior Plans.~~2016 Incentive Plan and 2012 Incentive Plan. All shares of restricted stock vest five years from the date of grant and under specified circumstances, including a change in control, may vest earlier. For ~~accounting~~financial statement purposes, the restricted stock is not included in the outstanding shares shown on the consolidated balance sheets until they vest, but are included in the earnings per share computation.

For the three months ended March 31, ~~2017~~2018 and ~~2016,~~2017, the Company recorded $224,000 and $276,000, respectively, and ~~$188,000,~~for the six months ended March 31, 2018 and 2017, the Company recorded $467,000 and $490,000, respectively, of compensation expense related to the amortization of unearned compensation with respect to the stock awards. For the six months ended March 31, 2017 and 2016, the Company recorded $490,000 and $418,000, respectively, of compensation expense related to the amortization of unearned compensation with respect to the restricted

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stock awards. At March 31, ~~2017~~2018, and September 30, ~~2016, $2,843,000~~2017, $3,603,000 and ~~$2,089,000~~$2,356,000 has been deferred as unearned compensation and will be charged to expense over the remaining vesting periods of these restricted stock awards. The weighted average remaining vesting period of these shares of restricted stock is ~~2.8~~3.5 years.

Stock Buyback

On ~~March 11, 2016,~~September 5, 2017, the Board of Directors approved a repurchase ~~program~~plan authorizing the Company, effective as of October 1, 2017, to repurchase up to $5,000,000 of shares of common stock through September 30, ~~2017. During the six months ended March 31, 2017, the Company purchased 5,775~~2019. No shares ~~of common stock at an average market price of $8.26 per share for a purchase price, including commissions, of $47,000.~~have been repurchased pursuant to this plan.

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Per Share Data

Basic earnings ~~(loss)~~ per share is determined by dividing net income ~~(loss)~~ applicable to common ~~shareholders~~stockholders for the applicable period by the weighted average number of common shares outstanding during such period. The Units are excluded from the basic earnings per share calculation, as they are not participating securities. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common ~~shares~~stock were exercised or converted into shares of common ~~shares~~stock or resulted in the issuance of shares of common ~~shares~~stock that share in the earnings of the Company. Diluted earnings ~~(loss)~~ per share is determined by dividing net income ~~(loss)~~ applicable to common ~~shareholders~~stockholders for the applicable period by the weighted average number of shares of common stock outstanding and deemed to be outstanding during such period. For the three and six months ended March 31, ~~2017, none~~2018, the Company included 200,000 shares of common stock underlying the Units ~~are included~~ in the calculation of diluted ~~weighted average~~earning per share as ~~they did not meet~~a market criteria, with respect to such units, has been met at March 31, 2018.

The following table sets forth the ~~applicable performance metrics during such periods.~~

~~Basic~~computation of basic and diluted shares outstanding for the three months ended March 31, 2017 and 2016, were 14,018,099 and 14,132,235, respectively, and for the six months ended March 31, 2017 and 2016, were 13,957,706 and 14,116,560, respectively.earnings per share (dollars in thousands, except share amounts):



	Three Months Ended March 31,					Six Months Ended March 31,
	2018		2017			2018		2017
Numerator for basic and diluted earnings (loss) per share attributable to common stockholders:
Net income (loss) attributable to common stockholders	$	25,222	$	(4,229	)	31,573		11,541

Denominator:
Denominator for basic earnings (loss) per share—weighted average number of shares	14,242,076		14,018,099			14,131,050		13,957,706
Effect of diluted securities	200,000		—			200,000		—
Denominator for diluted earnings per share—adjusted weighted average number of shares and assumed conversions	14,442,076		14,018,099			14,331,050		13,957,706

Basic earnings (loss) per share	$	1.77	$	(0.30	)	$	2.23	$	0.83
Diluted earnings (loss) per share	$	1.75	$	(0.30	)	$	2.20	$	0.83

Note 4 ‑ Real Estate Properties

Real estate properties (including properties held for sale) consist of the following (dollars in thousands):


	March 31, 2017			September 30, 2016			March 31, 2018			September 30, 2017
Land	$	126,344		$	128,409		$	157,105		$	138,094
Building	678,490			684,133			874,679			808,366
Building improvements	29,423			25,717			29,109			31,411
Real estate properties	834,257			838,259			1,060,893			977,871
Accumulated depreciation	(53,143		)	(44,687		)	(67,643		)	(66,621		)
Total real estate properties, net	$	781,114		$	793,572		$	993,250		$	911,250

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A summary of real estate properties owned (including properties held for sale) follows (dollars in thousands):


	September 30, 2016 Balance		Additions		Capitalized Costs and Improvements		Depreciation			Sales			March 31, 2017 Balance		September 30, 2017 Balance		Additions		Capitalized Costs and Improvements		Depreciation			Sales			March 31, 2018 Balance
Multi-family	$	783,085	$	88,218	$	5,305	$	(14,014	)	$	(92,037	)	$	770,557	$	890,300	$	185,415	$	5,247	$	(17,833	)	$	(103,655	)	$	959,474
Multi-family development - West Nashville, TN															10,448		12,881		—		—			—			23,329
Land - Daytona, FL	8,021		—		—		—			—			8,021		8,021		—		—		—			—			8,021
Shopping centers/Retail - Yonkers, NY	2,466				125		(55		)	—			2,536		2,481		—		—		(55		)	—			2,426
Total real estate properties	$	793,572	$	88,218	$	5,430	$	(14,069	)	$	(92,037	)	$	781,114	$	911,250	$	198,296	$	5,247	$	(17,888	)	$	(103,655	)	$	993,250

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The following table summarizes the ~~preliminary allocations of the purchase price of six properties purchased between August 1, 2016 and March 31, 2017 and the finalized~~ allocation of the purchase price of ~~such~~four properties ~~as adjusted as of~~purchased during the six months ended March 31, ~~2017~~2018 (dollars in thousands):


	Preliminary Purchase Price Allocation		Adjustments			Finalized Purchase Price Allocation		Purchase Price Allocation
Land	$	26,099	$	(1,550	)	$	24,549	$	37,282
Building and improvements	160,405		341			160,746		140,027
Acquisition-related intangible assets	1,515		1,209			2,724		3,992
Total consideration	$	188,019	$	—		$	188,019	$	181,301

As result of the damage caused by Hurricane Harvey in 2017, the Company reduced the carrying value of Retreat at Cinco Ranch, located in Katy, TX by $3,471,000 and, because the Company believed it was probable that it would recover such sum from its insurance coverage, recognized such sum in insurance recoveries. Through March 31, 2018, the Company received $7,384,000 in insurance recoveries related to Hurricane Harvey, of which $3,227,000 is recorded as a gain on insurance recovery in the three and six months ended March 31, 2018 and $686,000 has been recognized as rental income (i.e. $98,000 in 2017 and $294,000 and $588,000 in the three and six months ended March 31, 2018, respectively.)

Note 5 ‑ Acquisitions and Dispositions

Property Acquisitions

The table below provides information regarding the Company's purchases of multi-family properties for the six months ended March 31, ~~2017 regarding the Company's purchases of multi-family properties~~2018 (dollars in thousands):

Location Purchase Date No. of Units Purchase Price Acquisition Mortgage Debt Initial BRT Equity Ownership Percentage Capitalized Acquisition Costs
(a)
Fredricksburg, VA 11/4/2016 220
$ 38,490
$ 29,940
$ 8,720
80 % $ 643
St. Louis, MO 2/28/2017 53
8,000
6,200
2,002
75.5 % 134
St. Louis, MO 2/28/2017 128
27,000
20,000
6,001
75.5 % 423

401
$ 73,490
$ 56,140
$ 16,723
$ 1,200



Location	Purchase Date	No. of Units	Purchase Price		Acquisition Mortgage Debt		Initial BRT Equity		Ownership Percentage		Capitalized Acquisition Costs
Madison, AL	12/7/2017	204	$	18,420	$	15,000	$	4,456	80	%	$	247
Boerne, TX (a)	12/14/2017	120	12,000		9,200		3,780		80	%	244
Ocoee, FL	2/7/2018	522	71,347		53,060		12,370		50	%	1,047
Lawrenceville, GA	2/15/2018	586	77,229		54,447		15,179		50	%	767
		1,432	$	178,996	$	131,707	$	35,785			$	2,305

(a) ~~See Note 15.~~Includes $500 for the acquisition of a land parcel adjacent to the property.

~~The table below provides information for~~In the ~~six months~~quarter ended March 31, ~~2016 regarding the Company's purchases of multi-family properties (dollars in thousands):~~

Location Purchase Date No. of Units Purchase Price Acquisition Mortgage Debt Initial BRT Equity Ownership Percentage Expensed Acquisition Costs
N. Charleston, SC (a) 10/13/2015 271
$ 3,625
—
$ 6,558
65 % —
La Grange, GA 11/18/2015 236
22,800
$ 16,051
6,824
100 % $ 57
Katy, TX 1/22/2016 268
40,250
30,750
8,150
75 % 382
Macon, GA 2/1/2016 240
14,525
11,200
3,250
80 % 158
Southaven, MS 2/29/2016 392
35,000
28,000
5,856
60 % 413
1,407
$ 116,200
$ 86,001
$ 30,638
$ 1,010

(a) This 41.5 acre land parcel was purchased for development. The initial equity includes funds contributed in connection with commencement of construction. Acquisition costs related to this development have been capitalized.

~~Subsequent to March 31, 2017,~~2018, the Company purchased its partner's 2.5% interest in Avalon Apartments, located in Pensacola, FL., for $250,000.

On April 30, 2018, the ~~following~~Company acquired, through a joint venture in which it has a 80% equity interest, a 208-unit multi-family property ~~(dollars~~located in ~~thousands):~~

Location Purchase Date No. of Units Purchase Price Acquisition Mortgage Debt Initial BRT Equity Ownership Percentage Capitalized Acquisition Costs
Creve Coeur, MO 4/4/2017 174
$ 39,600
$ 29,000
$ 9,408
78 % $ 567

Daytona, FL, for $20,500,000, including the assumption of $13,608,000 of mortgage debt. The mortgage

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debt matures in May 2025, bears interest at a fixed rate of 3.94%, is interest only for two years, and thereafter amortizes based on a 30-year schedule. The Company contributed $6,900,000 for its ownership interest.

The table below provides information regarding the Company's purchases of multi-family properties during the six months ended March 31, 2017 (dollars in thousands):



Location	Purchase Date	No. of Units	Purchase Price		Acquisition Mortgage Debt		Initial BRT Equity		Ownership Percentage		Capitalized Acquisition Costs
Fredricksburg, VA	11/4/2016	220	$	38,490	$	29,940	$	8,720	80	%	$	643
St. Louis, MO	2/28/2017	128	27,000		20,000		6,001		75.5	%	423
St. Louis, MO	2/28/2017	53	8,000		6,200		2,002		75.5	%	134
		401	$	73,490	$	56,140	$	16,723			$	1,200

Property Dispositions

The following table is a summary of real estate properties disposed of by the Company during the six months ended March 31, 2018 (dollars in thousands):



Location	Sale Date	No. of Units	Sales Price		Gain on Sale		Non-controlling partner portion of gain
Melbourne, FL	10/25/2017	208	$	22,250	$	12,519	$	2,504
Palm Beach Gardens, FL	2/5/2018	542	97,200		41,830		20,593
Valley, AL	2/23/2018	618	51,000		9,712		4,547
Fort Washington	1/18/2018	1	470		439		—
		1,369	$	170,920	$	64,500	$	27,644

The following table is a summary of the real estate properties disposed of by the Company induring the six months ended March 31, 2017 (dollars in thousands):


Location	Sale Date	No. of Units	Sales Price		Gain on Sale			Non-controlling partner portion of gain		Sale Date	No. of Units	Sales Price		Gain on Sale		Non-controlling partner portion of gain
Greenville, NC	10/19/2016	350	$	68,000	$	18,483		$	9,329
Greenville, SC										10/19/2016	350	$	68,000	$	18,483	$	9,329
Panama City, FL	10/26/2016	160	14,720		7,393		��	3,478		10/26/2016	160	14,720		7,393		3,478
Atlanta, GA	11/21/2016	350	36,750		8,905			4,166		11/21/2016	350	36,750		8,905		4,166
Hixson, TN	11/30/2016	156	10,775		608			152
Hixson,TN										11/30/2016	156	10,775		608		152
New York, NY	12/21/2016	1	465		449			—		12/21/2016	1	465		449		—
		1,017	$	130,710	$	35,838		$	17,125		1,017	$	130,710	$	35,838	$	17,125

Impairment Charges

The ~~following table is a summary of the~~Company reviews each real estate asset owned, including those held through investments in unconsolidated joint ventures, for impairment when there is an event or a change in circumstances indicating that the carrying amount may not be recoverable. The Company measures and records impairment losses, and reduces the carrying value of properties, ~~disposed~~when indicators of byimpairment are present and the expected undiscounted cash flows related to those properties are less than their carrying amounts. In cases where the Company indoes not expect to recover its carrying costs on properties held for use, the Company reduces its carrying costs to fair value, and for properties held for sale, the Company reduces its carrying value to the fair value less costs to sell. During the three and six months ended March 31, ~~2016 (dollars in thousands):~~

Location Sale
Date No. of
Units Sales Price Gain on Sale Non-controlling partner portion of gain
New York, NY 10/1/2015 1
$ 652
$ 609
—
Cordova, TN 3/2/2016 464
31,100
6,764
$ 2,195
Kennesaw, GA 3/15/2016 450
64,000
17,462
10,037
915
$ 95,752
$ 24,835
$ 12,232
2018 and 2017, no impairment charges were recorded.

Note 6 ~~–Real Estate Loan~~- Variable Interest Entities

AsThe Company conducts a ~~result~~large portion of ~~the sale~~its business with joint venture partners. Many of the Company's consolidated joint ventures that own properties were determined to be variable interest inentities ("VIEs") because the ~~Newark Joint Venture in February 2016,~~voting rights of some equity partners are not proportional to their obligations to absorb the mortgage loan owed to the Company by the venture (the "NJV Loan Receivable"), which, prior to the sale, was eliminated in consolidation, is reflected as a real estate loan on the consolidated balance sheets. At September 30, 2016, the principal amountexpected loses of the ~~NJV Loan Receivable was $19,500,000.~~entity and their rights to receive expected

~~In February 2017,~~

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residual returns. It was determined that the Company ~~received (i)~~is the primary beneficiary of these joint venture because it has a ~~$13,600,000 principal paydown~~controlling financial interest in that it has the power to direct the activities of the ~~NJV Loan Receivable~~VIE that most significantly impacts the entity's economic performance and ~~(ii) $2,606,000, representing all~~it has the ~~interest (i.e., current~~obligation to absorb losses of the entity and ~~deferred) due through~~ the ~~repayment date. In connection with this transaction, the Company released certain properties~~right to receive benefits from the ~~mortgages securing~~entity that could potentially be significant to the ~~NJV Loan Receivable. Accordingly, at March 31, 2017,~~VIE.

The following is a summary of the ~~NJV Loan Receivable principal~~carrying amounts with respect to the consolidated VIEs and their classification on the Company's consolidated balance ~~is $5,900,000. This receivable matures~~sheets (amounts in ~~June 2017, bears interest, payable monthly, at a rate of 11% per year, and is secured by several properties in Newark, NJ.~~thousands):



	March 31, 2018 (unaudited)		September 30, 2017
ASSETS
Real estate properties, net of accumulated depreciation of $48,037 and $52,873	$	625,714	$	707,546
Cash and cash equivalents	9,228		8,626
Deposits and escrows	8,632		13,873
Other assets	5,765		8,148
Real estate properties held for sale	—		8,969
Total Assets	$	649,339	$	747,162

LIABILITIES
Mortgages payable, net of deferred costs of $4,189 and $5,170	$	479,093	$	558,568
Accounts payable and accrued liabilities	7,550		14,419
Total Liabilities	$	486,643	$	572,987

Note 7 - Real Estate Property Held For Sale

At September 30, ~~2016, the Sandtown Vista property in Atlanta, GA and the Spring Valley property in Panama City,~~2017, Waverly Place Apartments, Melbourne, FL, ~~were held for sale. The Sandtown Vista property, which had~~with a book value of ~~$27,076,000,~~$8,969,000, was ~~sold on November 21, 2016. The Spring Valley~~held for sale. This property ~~which had a book value $6,920,000,~~ was sold on October ~~26, 2016.~~25, 2017. The Company did not have any properties that met the criteria for held-for-sale classification at March 31, 2018.

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Note 8 - Restricted Cash

Restricted cash represents funds ~~that are being~~ held for specific purposes and are therefore not generally available for general corporate purposes. AsThe restricted cash reflected on the consolidated balance sheets ~~Restricted cash~~ represents funds that are held by or on behalf of the Company specifically for capital improvements at certain multi-family properties.

Note 9 – Investment in Unconsolidated Ventures

~~During~~The Company has interests in unconsolidated joint ventures that own multi-family properties. The table below provides information regarding these joint ventures at March 31, 2018 (dollars in thousands):



Location	Number of Units	Carrying Value		Mortgage Debt		Percent Ownership
Columbia, SC	374	$	4,832	$	41,000	32	%
Columbia, SC (a)	339	8,665		—		46	%
Forney, TX (b)	313	7,140		25,350		50	%
Other investments	N/A	208		N/A		N/A
	1,026	$	20,845	$	66,350

__________________________


(a)	Reflects land purchased for a development project at which construction of 339 units is planned. Construction financing for this project of up to $47,426 has been secured. Such financing bears interest at 4.08% and matures in June 2020. At March 31, 2018, no amounts have been drawn on this financing.


(b)	This interest is held through a tenancy-in-common.

The net loss from these ventures was $63,000 and $0 in the three months ended March 31, 2018 and 2017, respectively and for the six months ended March 31, 2018 and 2017 ~~the Company purchased interests in two unconsolidated joint ventures in Columbia, SC: (i) a $5,670,000 investment for a 32% interest in a venture which owns a 374 unit multi-family property;~~was $88,000 and ~~(ii) an $8,665,000 investment for a 46% interest in a venture in which the Company contemplates the construction~~$0, respectively.

Table of ~~339 multi-family units. Construction financing for this development project has been secured.~~Contents

Note 10 – Debt Obligations

Debt obligations consist of the following (dollars in thousands):

March 31, 2017 September 30, 2016
Mortgages payable (a)
$ 608,429
$ 621,382
Junior subordinated notes 37,400
37,400
Deferred mortgage costs (5,688 ) (6,275 )
Total debt obligations, net of deferred costs $ 640,141
$ 652,507

~~(a) Excludes mortgages payable held for sale of $27,052,000 at September 30, 2016.~~



	March 31, 2018			September 30, 2017
Mortgages payable	$	749,775		$	704,171
Junior subordinated notes	37,400			37,400
Deferred mortgage costs	(6,922		)	(6,727		)
Total debt obligations, net of deferred costs	$	780,253		$	734,844

Mortgages Payable

During the six months ended March 31, ~~2017,~~2018, the Company ~~incurred~~obtained the following ~~fixed rate~~ mortgage debt in connection with the ~~following~~related property acquisitions (dollars in thousands):

Location Closing Date Acquisition Mortgage Debt Interest Rate Interest only period Maturity Date
Fredricksburg, VA 11/4/16 $ 27,638
3.68 % N/A February 2027
St. Louis, MO 2/28/17 20,000
4.79 % 5 years March 2027
St. Louis, MO 2/28/17 6,197
4.84 % 5 years March 2027
$ 53,835

Location

Closing Date

Acquisition Mortgage Debt

Interest Rate

Interest only period

Maturity Date

Madison, AL

12/7/17

15,000

4.08

60 months

January 2028

Boerne, TX (a)

12/14/17

9,200

LIBOR+ 2.39%

36 months

January 2028

Ocoee, FL

2/7/18

53,060

3.90

84 months

January 2028

Lawrenceville, GA

2/15/18

54,447

3.97

120 months

March 2028

131,707

_____________________________

(a) The Company entered into an agreement related to this loan to cap LIBOR at 3.86%. See Note 13.

~~During the six months ended~~The Company has two construction loans financing two separate construction projects. Information regarding these loans at March 31, ~~2017, the Company obtained supplemental fixed rate mortgage financing as~~2018 is set forth ~~in the table~~ below (dollars in ~~thousands)~~thousand):

Location

Closing Date

Supplemental Mortgage Debt

Interest Rate

Maturity Date

Closing Date

Maximum Loan Amount

Amount outstanding

Interest Rate

Maturity Date

Extension Option

Fredricksburg, VA

11/4/16

2,261

4.84

February 2027

N Charleston, SC (a)

10/13/2015

30,265

29,890

LIBOR + 1.70%

10/13/2019

1 year

Nashville,TN

6/2/2017

47,426

—

LIBOR + 2.85%

6/2/2020

N/A

77,691

29,890

_____________________

(a) Currently in lease up.

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During the six months ended March 31, 2017, $11,905,000 was advanced on the construction loan that financed the N. Charleston, SC (Factory at Garco) development. At March 31, 2017, $4,817,000 is available on this facility.

Junior Subordinated Notes

At March 31, ~~2017~~2018, and September 30, ~~2016,~~2017, the Company's junior subordinated notes had an outstanding principal balance of $37,400,000, before deferred financing costs of ~~$392,000~~$372,000 and ~~$402,000,~~$382,000, respectively. At March 31, ~~2017,~~2018, the interest rate on the outstanding balance is three month LIBOR + 2.00%, or ~~3.04%~~3.77%.

The junior subordinated notes require interest only payments through the maturity date of April 30, 2036, at which time repayment of the outstanding principal and unpaid interest become due. Interest expense ~~including the amortization of deferred costs,~~ for the three months ended March 31, 2018 and 2017, which includes amortization of deferred costs, was $352,000 and ~~2016, was~~ $287,000, ~~and $463,000,~~ respectively, and for the six months ended March 31, 2018 and 2017, was $682,000 and ~~2016, was~~ $561,000, ~~and $926,000,~~ respectively.

Note 11 – Related Party Transactions

~~Majestic Property~~

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The Company has retained certain of its executive officers and Fredric H. Gould, a director, to provide, among other things, the following services: participating in the Company's multi-family property analysis and approval process (which includes service on the investment committee), providing investment advice, long-term planning and consulting with executives and employees with respect to other business matters, as required. The aggregate fees paid for these services in the three months ended March 31, 2018 and 2017 were $317,000 and $302,000, respectively, and for the six months ended March 31, 2018 and 2017 were $619,000 and $589,000, respectively.

Management ~~Corp., a related party, provides management services to the Company for~~of certain properties owned by the Company and certain joint ~~ventures in which~~venture properties is provided by Majestic Property Management Corp. ("Majestic Property"), a company wholly owned by Fredric H. Gould, under renewable year-to-year agreements. Certain of the ~~Company participates.~~Company's officers and directors are also officers and directors of Majestic Property. Majestic Property may also provide real estate brokerage and construction supervision services to these properties. These fees amounted to $10,000 and $8,000 for the three months ended March 31, 2018 and 2017, respectively, and ~~2016, and $16,000 and $19,000~~ for the six months ended March 31, 2018 and 2017, were $19,000 and ~~2016,~~$16,000, respectively.

The Company shares facilities, personnel and other resources with One Liberty Properties, Inc., Majestic Property, and Gould Investors L.P. Certain of our executive officers and/or directors also serve in management positions, and have ownership interests, in One Liberty and/or Georgetown Partners Inc., the managing partner of Gould Investors L.P. The allocation of expenses for the ~~shared~~ facilities, personnel and other resources ~~used~~shared by the Company, One Liberty and Gould Investors is ~~determined~~computed in accordance with a shared services agreement by and among the Company and ~~related parties. Amounts paid pursuant to the agreement are~~these entities and is included in general and administrative ~~expenses~~expense on the consolidated ~~statement~~statements of operations. ~~The Company reimbursed Gould Investors L.P., a related party, $103,000 and $160,000, for~~For the three months ended March 31, 2018 and 2017, net allocated general and ~~2016,~~administrative expenses reimbursed by the Company to Gould Investors L.P. pursuant to the shared services agreement aggregated $147,000 and $103,000, respectively, and ~~$182,000 and $297,000~~ for the six months ended March 31, 2018 and 2017 were $228,000 and ~~2016, respectively, for services provided under the agreement.~~$182,000, respectively.

Management of many of the Company's multi-family properties (including two multi-family properties owned by two unconsolidated ~~multi-family properties)~~joint ventures) is performed by the Company's joint venture partners or their ~~affiliates (none~~affiliates. None of these joint venture partners is Gould Investors L.P., Majestic Property or ~~its affiliates).~~their affiliates. Management fees to these related parties for the three months ended March 31, 2018 and 2017 were $908,000 and ~~2016 were~~ $672,000, ~~and $366,000,~~ respectively, and for the six months ended March 31, 2018 and 2017 were $1,767,000 and ~~2016 were $1,296,000 and $788,000, respectively.~~$1,296,000. In addition, the Company may pay an acquisition fee to a joint venture partner in connection with a property purchased by such joint venture. ~~Acquisition~~Capitalized acquisition fees to these related parties for the three months ended March 31, 2018 and 2017, were $1,300,000 and ~~2016 were~~ $350,000, ~~and $438,000,~~ respectively, and for ~~the~~ six months ended March 31, 2018 and 2017, were $1,530,000 and ~~2016 were~~ $650,000, ~~and $439,000,~~ respectively.

In the quarter ended December 31, 2015, the Company borrowed $8,000,000 from Gould Investors L.P., a related party. Interest for the three and six months ended March 31, 2016 was $62,000 and $86,000, respectively. This loan was repaid on February 24, 2016.

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~~Note 12 - Segment Reporting~~

Management determined that the Company operates in two reportable segments: a multi-family property segment, which includes the ownership, operation and development of multi-family properties; and an other assets segment, which includes the ownership and operation of the Company's other real estate assets and a real estate loan.

~~The following tables summarize the Company's segment reporting for the periods indicated (dollars in thousands):~~

Three Months Ended March 31, 2017

Multi-Family
Real Estate

Other
Assets

Total
Revenues:
Rental and other revenues from real estate properties $ 24,318
$ 384
$ 24,702
Other income (9 ) 190
181
Total revenues 24,309
574
24,883
Expenses:
Real estate operating expenses 11,749
160
11,909
Interest expense 5,870
532
6,402
General and administrative 2,343
47
2,390
Depreciation 7,745
27
7,772
Total expenses 27,707
766
28,473
Loss from continuing operations (3,398 ) (192 ) (3,590 )
Provision for taxes 1,086
22
1,108
Loss from continuing operation, net of taxes (4,484 ) (214 ) (4,698 )
Net loss (income) attributable to non-controlling interests 502
(33 ) 469
Net loss attributable to common stockholders $ (3,982 ) $ (247 ) $ (4,229 )
Segment Assets at March 31, 2017 $ 853,226
$ 17,294
$ 870,520

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Three Months Ended March 31, 2016

Multi-Family
Real Estate
Other Assets

Total
Revenues:
Rental and other revenues from real estate properties $ 23,635
$ 358
$ 23,993
Other income —
2,026
2,026
Total revenues 23,635
2,384
26,019
Expenses:
Real estate operating expenses 11,955
142
12,097
Interest expense 6,028
21
6,049
Property acquisition costs 953
—
953
General and administrative 2,234
46
2,280
Depreciation and amortization 5,605
27
5,632
Total expenses 26,775
236
27,011
Total revenues less total expenses (3,140 ) 2,148
(992 )
Gain on sale of real estate assets 24,226
—
24,226
Loss on extinguishment of debt (2,668 ) —
(2,668 )
Income from continuing operations 18,418
2,148
20,566
Net (income) loss attributable to non-controlling interests (10,581 ) 672
(9,909 )
Net income attributable to common stockholders before reconciling adjustment $ 7,837
$ 2,820
$ 10,657
Reconciling adjustment:
Discontinued operations, net of non-controlling interest 14,279
Net income attributable to common stockholders $ 24,936
Segment Assets at March 31, 2016 $ 722,338
$ 30,637
$ 752,975

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Six Months Ended March 31, 2017

Multi-Family
Real Estate

Other
Assets

Total
Revenues:
Rental and other revenues from real estate properties $ 48,960
$ 771
$ 49,731
Other income (9 ) 801
792
Total revenues 48,951
1,572
50,523
Expenses:
Real estate operating expenses 24,099
256
24,355
Interest expense 11,962
1,127
13,089
General and administrative 4,887
100
4,987
Depreciation 14,015
54
14,069
Total expenses 54,963
1,537
56,500
Total revenue less total expenses (6,012 ) 35
(5,977 )
Gain on sale of real estate 35,389
449
35,838
Loss on extinguishment of debt (799 ) —
(799 )
Income from continuing operations 28,578
484
29,062
Provision for taxes 1,429
29
1,458
Income from continuing operations, net of taxes 27,149
455
27,604
Net loss attributable to non-controlling interests (15,995 ) (68 ) (16,063 )
Net income attributable to common stockholders $ 11,154
$ 387
$ 11,541
Segment Assets at March 31, 2017 $ 853,226
$ 17,294
$ 870,520

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Six Months Ended March 31, 2016

Multi-Family
Real Estate
Other Assets

Total
Revenues:
Rental and other revenues from real estate properties $ 45,639
$ 673
$ 46,312
Other income —
2,033
2,033
Total revenues 45,639
2,706
48,345
Expenses:
Real estate operating expenses 22,899
292
23,191
Interest expense 11,487
93
11,580
Advisor's fee, related party 594
99
693
Property acquisition costs 1,010
—
1,010
General and administrative 3,895
134
4,029
Depreciation 10,563
53
10,616
Total expenses 50,448
671
51,119
Total revenue less total expenses (4,809 ) 2,035
(2,774 )
Gain on sale of real estate 24,226
609
24,835
Loss on extinguishment of debt (2,668 ) —
(2,668 )
Income from continuing operations 16,749
2,644
19,393
Net (income) loss attributable to non-controlling interests $ (10,780 ) $ 1,610
(9,170 )
Net income attributable to common stockholders before reconciling adjustment $ 5,969
$ 4,254
10,223
Reconciling adjustment:
Discontinued operations, net of non-controlling interest 12,679
Net income attributable to common stockholders $ 22,902
Segment Assets at March 31, 2016 $ 722,338
$ 30,637
$ 752,975

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Note 1312 – Fair Value of Financial Instruments

Financial Instruments Not ~~Measured~~Carried at Fair Value

The following methods and assumptions were used to estimate the fair value of each class of financial instruments that are not recorded at fair value on the consolidated balance sheets:

Cash and cash equivalents, restricted cash, accounts receivable (included in other assets), accounts payable and accrued liabilities: The carrying amounts reported in the balance sheets for these instruments approximate their fair value due to the short term nature of these accounts.

Junior subordinated notes: At March 31, ~~2017~~2018 and September 30, ~~2016~~2017, the estimated fair value of the notes is lower than their carrying value by approximately ~~$16,237,000~~$12,865,000 and ~~$16,549,000~~$15,705,000 based on a market interest rate of ~~6.63%~~7.18% and 6.37%, respectively.

Mortgages payable: At March 31, ~~2017,~~2018, the estimated fair value of the Company’s mortgages payable is lower than their carrying value by approximately ~~$12,704,000~~$23,145,000 assuming market interest rates between ~~3.79%~~3.99% and ~~4.99%~~5.66% and at September 30, ~~2016,~~2017, the estimated fair value of the Company's mortgages payable was ~~greater~~lower than their carrying value by approximately ~~$10,629,000~~$11,400,000 assuming market interest rates between ~~3.05%~~3.78% and ~~4.25%~~5.02%. Market interest rates were determined using rates which the Company believes reflects institutional lender yield ~~requirements.~~requirements at the balance sheet dates.

Considerable judgment is necessary to interpret market data and develop estimated fair value. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value assumptions.

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Financial Instruments ~~Measured~~Carried at Fair Value

The Company’s fair value measurements are based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, there is a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity and the reporting entity’s own assumptions about market participant assumptions. Level 1 assets/liabilities are valued based on quoted prices for identical instruments in active markets, Level 2 assets/liabilities are valued based on quoted prices in active markets for similar instruments, on quoted prices in less active or inactive markets, or on other “observable” market inputs, and Level 3 assets/liabilities are valued based significantly on “unobservable” market inputs. The Company does not currently own any financial instruments that are classified as Level 3. Set forth below is information regarding the Company’s financial assets and liabilities measured at fair value as of March 31, ~~2017~~2018 (dollars in thousands):


	Carrying and Fair Value		Fair Value Measurements Using Fair Value Hierarchy			Carrying and Fair Value		Fair Value Measurements Using Fair Value Hierarchy
	Carrying and Fair Value		Level 1	Level 2		Carrying and Fair Value		Level 1	Level 2
Financial Assets:
Interest rate swaps	$	1,818	—	$	1,818	$	3,070	—	$	3,070
Interest rate cap						9		—	9
Total Financial Assets						$	3,079	—	$	3,079

Financial Liabilities:
Interest rate swap	$	17	—	$	17	$	—	—	$	—

Derivative financial instruments: Fair values are approximated using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivatives. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves, foreign exchange rates, and implied volatilities. At March 31, ~~2017,~~2018, these derivatives are included in other assets ~~and other accounts payable and accrued liabilities~~ on the consolidated balance sheet.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with them utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. As of March 31, ~~2017,~~2018, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative position and determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. As a result, the Company determined that its derivatives valuation is classified in Level 2 of the fair value hierarchy.

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Note 1413 – Derivative Financial Instruments

Cash Flow Hedges of Interest Rate Risk

The Company's objective in using interest rate derivatives is to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount.

The effective portion of changes in the fair value of derivatives, designated and that qualify as cash flow hedges, is recorded in ~~accumulated other comprehensive (income) loss~~Accumulated Other Comprehensive Income on our consolidated balance sheets and is subsequently reclassified into earnings in the period that the hedged ~~forecasted~~ transaction affects earnings. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings.

~~Amounts reported in accumulated other comprehensive income (loss) related to derivatives will be reclassified to interest expense as interest payments are made on the Company's variable-rate debt.~~

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As of March 31, ~~2017,~~2018, the Company had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk (dollars in thousands):


Interest Rate Derivative	Notional Amount		Fixed Rate		Maturity	Notional Amount		Fixed Rate		Maturity
Interest rate cap on LIBOR						$	9,200	3.86	%	January 1, 2021
Interest rate swap	$	1,531	5.25	%	April 1, 2022	1,387		5.25	%	April 1, 2022
Interest rate swap	$	26,400	3.61	%	May 6, 2023	26,400		3.61	%	May 6, 2023
Interest rate swap	$	27,000	4.05	%	September 19, 2026	27,000		4.05	%	September 19, 2026

The table below presents the fair value of the Company’s derivative financial instruments as well as its classification on the consolidated balance sheets as of the dates indicated (amounts in thousands):

												Derivatives as of:
March 31, 2017			September 30, 2016
March 31, 2018						March 31, 2018			September 30, 2017
Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value			Fair Value		Balance Sheet Location	Fair Value
Other Assets	$	1,818	Other Assets	$	—		$	3,079	Other Assets	$	1,460
Accounts payable and accrued liabilities	$	17	Accounts payable and accrued liabiltities	$	1,602		$	—	Accounts payable and accrued liabilities	$	14

As of March 31, ~~2017,~~2018, the Company did not have any derivative instruments that were considered to be ineffective and does not use derivative instruments for trading or speculative purposes.

The following table presents the effect of the Company’s interest rate swaps on the consolidated statements of comprehensive ~~loss~~(loss) income for the dates indicated (dollars in thousands):

Three Months Ended
March 31, Six Months Ended
March 31,
2017 2016 2017 2016
Amount of gain recognized on derivative in Other Comprehensive Income (loss) $ 65
$ (41 ) $ 3,189
$ (29 )
Amount of gain (loss) reclassified from Accumulated
Other Comprehensive Income (loss) into Interest Expense
$ (70 ) $ (7 ) $ (214 ) $ (15 )

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	Three Months Ended March 31,				Six Months Ended March 31,
	2018		2017		2018		2017
Amount of gain recognized on derivative in Other Comprehensive Income	$	1,132	$	65	$	1,590	$	3,189
Amount of loss reclassified from Accumulated Other Comprehensive Income into Interest expense	$	—	$	70	$	44	$	214

No gain or loss was recognized related to hedge ineffectiveness or to amounts excluded from effectiveness testing on the ~~Companys’s~~Company's cash flow hedges during the three and six months ended March 31, ~~2017~~2018 and March 31, ~~2016.~~2017. The Company estimates an additional ~~$197,000~~$294,000 will be reclassified from other comprehensive ~~income (loss)~~loss as ~~an increase~~a decrease to interest expense over the next twelve months.

Credit-risk-related Contingent Features

The agreement between the Company and its derivative counterparties provides that if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, the Company could be declared in default on its derivative obligations.

As of March 31, 2017, the fair value of the derivative in a net liability position, which includes accrued interest, but excludes any adjustment for nonperformance risk related to these agreement, was $16,000. As of March 31, 2017, the Company has not posted any collateral related to these agreements. If the Company had been in breach of these agreements at March 31, 2017, it could have been required to settle its obligations thereunder at its termination value of $16,000.

Note 1514 – New Accounting Pronouncements

In January 2017, the Financial Accounting Standards Board ("FASB") issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The ASU clarifies the definition of a business with the objective of adding guidance to assist companies and other reporting organizations with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or business combinations. The ASU is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. Early adoption is permitted. The Company elected early adoption effective for the quarter ended December 31, 2016. The Company's net income was favorably impacted as a result of the capitalization of acquisition costs - in prior periods, property acquisition costs were expensed during the period incurred. During the three and six months ended March 31, 2017, capitalized acquisition costs were $557,000 and $1,200,000, respectively, without giving effect to non-controlling interests.

In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which requires all excess tax benefits or deficiencies to be recognized as income tax expense or benefit in the income statement. In addition, excess tax benefits should be classified along with other income tax cash flows as an operating activity in the statement of cash flows. Application of the standard is required for the annual and interim periods beginning after December 15, 2016. Early adoption is permitted. The Company is currently evaluating the impact of this new standard on our consolidated financial statements.

In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis, which amends the current consolidation guidance, including introducing a separate consolidation analysis specific to limited partnerships and other similar entities. Under this analysis, limited partnerships and other similar entities will be considered a VIE unless the limited partners hold substantive kick-out rights or participating rights. The guidance is effective for annual periods beginning after December 15, 2015, including interim periods within those periods, with early adoption permitted. The Company adopted this guidance in the quarter December 31, 2016 and its adoption did not have a material effect on its consolidated financial statements.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09), prescribes a single, common revenue standards which supersedes nearly all existing revenue recognition guidance under U.S. ~~GAAP.~~GAAP, including most industry-specific requirements. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 ~~defines~~outlines a five step ~~process~~model to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2017, and interim periods ~~thereafter,~~therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting

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period with the option to elect certain practical expedients, or (ii) a modified retrospective approach with the cumulative

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effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). ~~The Company is~~We are currently evaluating the impact of our pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard during the year ending September 30, 2019.

In February 2016, the FASB issued ASU No. 2016-02, Leases. ASU 2016-02 supersedes the current accounting for leases and while retaining two distinct types of leases, finance and operating, (i) requires lessees to record a right of use asset and a related liability for the rights and obligations associated with a lease, regardless of lease classification, and recognize lease expense in ~~2018.~~a manner similar to current accounting (ii) eliminates most real estate specific lease provisions, and (iii) aligns many of the underlying lessor model principles with those in the new revenue standard. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 and early adoption is permitted. We are required to adopt ASU 2016-02 using the modified retrospective approach which requires us to record leases existing as of or are entered into after the beginning of the earliest comparative period presented in the financial statements under the new lease standard. We are currently evaluating the impact of our pending adoption of ASU No. 2016-02 on our consolidated financial statements. We believe our adoption of the new leasing standard will result in an immaterial increase in the assets and liabilities on our consolidated balance sheets, with no material impact to our consolidated statements of income and comprehensive income.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force), which provides specific guidance on eight cash flow classification issues and how to reduce diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The effective date of the standard will be fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, and early adoption is permitted. The Company is currently evaluating the new guidance to determine the impact, if any, on the consolidated financial statements.

In November 2016, the FASB issued ASU Update No. 2016-018, Statement of Cash Flows (Topic 230): Restricted Cash, (a consensus of the Emerging Issues Task Force). The new standard requires that the statement of cash flows explain the change during the period in the combined total of cash, cash equivalents, and amounts generally described as restricted cash equivalents. Entities will also be required to reconcile such total to amounts on the balance sheet and disclose relevant information about the nature of the restrictions on the basis of their individual facts and circumstances. The effective date of the standard will be fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, and early adoption is permitted.

Note 1615 – Subsequent Events

Subsequent events have been evaluated and any significant events, relative to our consolidated financial statements as of March 31, ~~2017~~2018, that warrant additional disclosure, have been included in the notes to the consolidated financial statements.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

With the exception of historical information, this report on Form 10-Q contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended. We intend such forward-looking statements to be covered by the safe harbor provision for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and include this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words "may", "will", "believe", "expect", "intend", "anticipate", "estimate", "project", or similar expressions or variations thereof. Forward-looking statements involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could materially affect actual results, performance or achievements. Investors are cautioned not to place undue reliance on any forward-looking statements and are urged to read ~~“Item~~“Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended September 30, ~~2016.~~2017 and in reports filed with the SEC thereafter.

Overview

General

We are an internally managed real estate investment trust, also known as a REIT, that is ~~primarily~~ focused on the ownership, operation and development of multi‑family properties. These activities are conducted primarily ~~conducted~~ through joint ventures in which we ~~typically~~ have ~~an 80% interest in the entity owning the property.~~a substantial ownership position. At March 31, ~~2017,~~2018, we (i) own ~~32 multi‑family~~34 multi-family properties located in 11 states with an aggregate of ~~8,805~~9,632 units (including ~~271~~445 units at two properties engaged in lease up activities (i.e., Factory at Garco Park and Vanguard Heights) and 402 units at a property ~~in lease up stage)~~under development (i.e. ~~At March 31, 2017, the net book~~, Bells Bluff)) with a carrying value of ~~the~~$982.8 million and (ii) have ownership interests, through unconsolidated entities, in three multi-family ~~assets was $770.6 million. During the three months ended March 31, 2017 the average occupancy at our stabilized~~ properties ~~was 93.3%.~~

~~We also own and operate various other real estate assets. At March 31, 2017, the net book~~with a carrying value of ~~these other real estate assets is $16.5 million, including a real estate loan~~$20.6 million. Most of ~~$5.9 million.~~our properties are located in the southeast United States and Texas.

As used herein, the term "same store properties" refers to operating properties that were owned for the entirety of the periods being presented and excludes properties that were in development or lease up during such ~~periods or not yet stabilized.~~

~~Conversion~~periods. Retreat at Cinco Ranch Katy, Texas, has been excluded from same store properties due to ~~a Maryland Corporation~~the damage it sustained from Hurricane Harvey. For the three months ended March 31, 2018 and 2017, there were 22 same store properties and for the six months ended March 31, 2018 and 2017, there were 21 same store properties.

~~On March 18,~~

Hurricane Harvey

In August 2017, ~~we completed the conversion from a Massachusetts business trust~~Hurricane Harvey caused significant damage to ~~a Maryland corporation. The conversion had no impact on the business or management~~our 268-unit Retreat at Cinco Ranch, Katy, Texas property. Among other things, 96 of our ~~company~~ground floor units were rendered uninhabitable and ~~has been treated~~ as a ~~tax-free exchange under relevant Internal Revenue Service regulations. Shares~~result of ~~beneficial interest were automatically converted~~the extensive damage to ~~shares~~the common areas of the property (i.e., pool and clubhouse), we offered, rent concessions and other accommodations to induce tenancies for the second and third floor units to reside at the property. As a result of the damage caused by the hurricane, we reduced the carrying value of this property by $3.5 million and, because we believed it was probable that we would recover such sum from our insurance coverage, we recognized $3.5 million in insurance recoveries. Through March 31, 2018, we received approximately $7.4 million (including $686,000 in rental income as described below) in insurance recoveries related to the loss, of which $3.2 million is recorded as a gain on insurance recovery in the three and six months ended March 31, 2018.

Our business interruption insurance is covering our losses in rental income with respect to the ground floor units until such units are repaired and accordingly, we continue to accrue revenues to be generated from such units. Through March 31, 2018 we received $686,000 to cover lost rental income, of which $294,000 and $588,000 is recorded as rental income in the three and six months ended March 31, 2018, respectively. We are also seeking to recover from our insurance carriers the cost of rent concessions and other accommodations we previously offered tenants and prospective tenants, which totaled approximately $145,000. As of May 1, 2018, certain common areas have been restored and nine ground floor units have been restored and leased. We anticipate this property will be substantially repaired by September 2018. We continue to negotiate with our insurance carriers to ensure that we are fully compensated for the damages sustained at Retreat at Cinco Ranch as a result of Hurricane Harvey.

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Status of Lease Up Activities and Development Project

At March 31, 2018, the occupancy rate at Factory at Garco Park and Vanguard Heights, which are in engaged in lease up activities, was 85.2% and 88.5%, respectively.

We anticipate that the buildings at our Bells Bluff development property will be completed from time to time from the end of calendar year 2018 through the end of calendar year 2019.

Dividend Declared During the Quarter Ended March 31, 2018

During the quarter ended March 31, 2018, we declared a quarterly dividend on our common stock atof $0.20 per share that was paid on April 6, 2018, to stockholders of record on March 27, 2018. This dividend represented an 11.1% increase from the ~~time of the Conversion.~~

~~Except as otherwise specified, all references~~dividend paid in this Form 10-Q to “BRT,” “we,” “us,” and “our” refer (i) from and after the time of the Conversion, to BRT Apartments Corp. and its subsidiaries and (ii) prior to the Conversion, to our predecessor BRT Realty Trust and its subsidiaries. Except as otherwise specified, all references in this Form 10-Q to “common stock” or “shares” refer (i) from and after the time of the Conversion, to common stock and (ii) prior to the Conversion, shares of beneficial interest.January 2018.

Acquisitions, Dispositions and ~~Recent~~Other Developments During the Three Months Ended March 31, 2018

Acquisitions

WeOn February 7, 2018, we acquired ~~two~~the Avenue Apartments, a 522-unit multi-family ~~properties,~~property located in ~~Saint Louis, MO, with an aggregate of 181 units~~Ocoee, FL, for ~~$35.0~~$71.3 million, including $53.1 million of mortgage debt ~~of $26.2 million~~ obtained in connection with the acquisition. ~~Commencing April 1, 2017, these properties are expected to generate,~~Based on our underwriting, we estimate that on a quarterly basis ~~$932,000~~this property will generate $1.6 million of rental revenue, ~~$407,000~~$776,000 of real estate operating expense, ~~$316,000~~$532,000 of interest expense and $948,000 of depreciation expense.

On February 15, 2018, we acquired Parc @ 980, a 586-unit multi-family property located in Lawrenceville, GA, for $77.2 million, including $54.4 million of mortgage debt obtained in connection with the acquisition. Based on our underwriting, we estimate that on a quarterly basis this property will generate $1.8 million of rental revenue, $911,000 of real estate operating expense, $541,000 of interest expense and $1.0 million of depreciation expense.

Dispositions

On February 5, 2018, we sold The Fountains Apartments, a 542-unit multi-family located in Palm Beach Gardens, FL, for a sales price of $97.2 million, and recognized a gain of $41.8 million, of which $20.6 million was allocated to the non-controlling partner. We also incurred $594,000 of mortgage prepayment costs, of which $289,000 was allocated to the non-controlling partner. During the quarter ended December 31, 2017, this property generated $2.3 million of rental revenues, $1.0 million of operating expenses, $463,000 of interest expense and $480,000 of depreciation expense.

On February 23, 2018, we sold Valley Venue Apartments, a 618-unit multi-family located in Valley, AL, for a sales price of $51.0 million, and recognized a gain of $9.7 million, of which $4.5 million was allocated to the non-controlling partner. In the quarter ended December 31, 2017, this property generated $1.5 million of rental revenues, $782,000 of operating expenses, $332,000 of interest expense and $412,000 of depreciation expense.

InGenerally, in the event of the sale of a multi-family property owned by a joint venture, as a result of allocation/distribution provisions of the applicable joint venture operating agreement, the allocation and distributions of cash and profits to us (as opposed to our joint venture partner) will be less than that implied by our percentage equity interest in the property

Recent Developments

On April ~~2017,~~30, 2018, we acquired, through a ~~220 unit~~consolidated joint venture in which we have a 80% equity interest, a 208-unit multi-family property located in ~~Creve Coeur, MO~~Daytona, FL, for ~~$39.6~~$20.5 million, including ~~$29.0~~the assumption of $13.6 million in mortgage debt. The mortgage matures in May 2025, bears interest at a fixed rate of ~~mortgage debt obtained in connection with the acquisition.~~3.94%, is interest only for two years, and thereafter amortizes based on a 30 year schedule. Based on our underwriting, we estimate that on a quarterly basis this property will generate $605,000 of rental revenue, $298,000 of real estate operating expenses, $134,000 of interest expense and $545,000 and depreciation expense.

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Results of Operations – Three months ended March 31, ~~2017~~2018 compared to three months ended March 31, ~~2016.~~2017.

Revenues

The following table compares our revenues for the periods indicated:


	Three Months Ended March 31,									Three Months Ended March 31,
(Dollars in thousands):	2017		2016		Increase			% Change		2018		2017		Increase (Decrease)			% Change
Rental and other revenues from real estate properties	$	24,702	$	23,993	$	709		3.0		$	29,476	$	24,702	$	4,774		19.3
Other income	181		2,026		(1,845		)	(91.1	)	175		181		(6		)	(3.3	)
Total revenues	$	24,883	$	26,019	$	(1,136	)	(4.4	)	$	29,651	$	24,883	$	4,768		19.2

Rental and other revenues from real estate properties.

The increase is due primarily to:

$6.9 million from seven properties acquired during the twelve months ended March 31, 2018, including two properties acquired in the current quarter that contributed $2.7 million of revenues,

$837,000 from Factory at Garco Park that is currently in lease up,

$708,000 from same store properties due to a net increase in rental and occupancy rates - five properties accounted for 63% of the net increase, and

$463,000 from the inclusion, for the entire three months ended March 31, 2018, of two properties that were only owned for a portion of the corresponding period in the prior year.

Offsetting this increase was a decrease of $4.1 million from the six properties sold from January 1, 2017, to March 31, 2018, including $2.1 million from two properties sold in the current quarter.

Expenses

The following table compares our expenses for the periods indicated:



	Three Months Ended March 31,
(Dollars in thousands)	2018		2017		Increase (Decrease)		% Change
Real estate operating expenses	$	14,198	$	11,909	$	2,289	19.2
Interest expense	8,657		6,402		2,255		35.2
General and administrative	2,453		2,390		63		2.6
Depreciation	9,240		7,772		1,468		18.9
Total expenses	$	34,548	$	28,473	$	6,075	21.3

Real estate operating expenses.

The increase is due primarily to:

$3.1 million from seven properties acquired during the twelve months ended March 31, 2018, including two properties acquired in the current quarter that accounted for $1.2 million of this increase,

$394,000 from Factory at Garco Park which is currently in lease up,

$316,000 from the inclusion, for the entire three months ended March 31, 2018, of two properties that were only owned for a portion of the corresponding period in the prior year, and

$148,000 from several same store properties due primarily to increased payroll expenses and utilities expense.

Offsetting the increase is $1.6 million of expense related to the the six properties sold from January 1, 2017 to March 31, 2018, including $485,000 from two properties sold in the current quarter.

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Interest expense.

The increase is due primarily to:

$2.4 million from the mortgage debt on seven properties acquired during the twelve months ended March 31, 2018, including two properties acquired in the current quarter that contributed $875,000 to the increase,

$220,000 of interest expense from Factory at Garco Park - interest of $101,000 on this property was capitalized in the corresponding period of the prior year, and

$193,000 due to the inclusion, for the entire three months ended March 31, 2018, of the mortgage interest on two properties that were only owned for a portion of the corresponding period of the prior year.

Offsetting the increase is a decrease of $637,000 relating to the mortgage debt on six properties sold from January 1, 2017 to March 31, 2018, including $315,000 from two properties sold in the current quarter.

Depreciation.

The increase is due primarily to:

$3.4 million from seven properties acquired during the twelve months ended March 31, 2018, including two properties acquired in the current quarter that accounted for $1,217,000 of the increase,

$266,000 from Factory at Garco Park,which was under development in the corresponding period in the prior year, and is currently in lease-up, and

$251,000 from the inclusion, for the entire three months ended March 31, 2018, of two properties that were only owned for a portion of the corresponding period of the prior year.

Offsetting the increase is a decrease of $1.2 million from properties sold from January 1, 2017, to March 31, 2018, and $1.3 million due to purchase price allocation adjustments made in the corresponding period of the prior year.

Other Income and Expenses

Gain on sale of real estate. The increase is due to the sales described under "Acquisitions, Dispositions and Other Developments During the Three Months Ended March 31, 2018 - Dispositions" and a $438,000 gain from the sale of a cooperative apartment unit. During the three months ended March 31, 2017 there were no comparable sales.

Gain on insurance recovery. During the three months ended March 31, 2018, we recognized a $3.2 million gain from the receipt of insurance proceeds related to Retreat at Cinco Ranch - Katy, Texas representing the proceeds received in excess of the assets written off.

Loss on extinguishment of debt. During the three months ended March 31, 2018, we incurred $593,000 of mortgage prepayment charges in connection with the sale of The Fountain Apartments-Palm Beach Gardens, FL. There was no corresponding charge in the three months ended March 31, 2017.

Income tax (benefit) provision . In the three months ended March 31, 2018, we received a refund of state taxes related to a prior year. The three months ended March 31, 2017, reflects state taxes paid as a result of income recognized at the state level, primarily from gains on property sales.

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Results of Operations – Six months ended March 31, 2018, compared to six months ended March 31, 2017.

Revenues

The following table compares our revenues for the periods indicated:



	Six Months Ended March 31,
(Dollars in thousands):	2018		2017		Increase (Decrease)			% Change
Rental and other revenues from real estate properties	$	57,638	$	49,731	$	7,907		15.9
Other income	362		792		(430		)	(54.3	)
Total revenues	$	58,000	$	50,523	$	7,477		14.8

Rental and other revenues from real estate properties.

The increase is due primarily to:

$~~6.5~~10.6 million from seven properties acquired during the ~~nine~~twelve months ended ~~December~~March 31, ~~2016,~~2018, including $3.8 million from the four properties acquired during the current period,

$~~1.0~~1.8 million from the inclusion, for the entire ~~three~~six months ended March 31, ~~2017,~~2018, of three properties that were only owned for a portion of the corresponding period in the prior year,

$~~590,000~~1.5 million from Factory at Garco Park that is currently in lease up, and

$1.4 million from same store properties due ~~primarily~~ to a net increase in rental and occupancy rates ~~from several multi-family~~- eight properties ~~and~~

~~$314,000 from two properties acquired during~~accounted for over 75% of the ~~three months ended March 31, 2017.~~net increase.

Offsetting this increase ~~was a decrease of $7.7~~were decreases of:

$4.0 million ~~of rental revenue~~ from the ~~ten~~seven properties sold during the twelve months ended September 30, 2017,

$3.1 million from ~~January 1, 2016~~three properties sold during the six months ended March 31, 2018, and

$255,000 from reduced rental income at Retreat at Cinco Ranch primarily due to ~~December 31, 2016.~~rent concessions and the loss of ancillary tenant income due to reduced occupancy.

Other Income.

The decrease is due ~~primarily~~ to ~~the recognition, in the corresponding period of the prior year, of $1.9 million of~~reduced interest ~~that had been deferred and not recognized for several years~~income on ~~the $19.5 million~~our loan to the Newark Joint ~~Venture.~~Venture primarily as a result of the $13.6 million paydown in December 2016.

Expenses

The following table compares our expenses for the periods indicated:


	Three Months Ended March 31,									Six Months Ended March 31,
(Dollars in thousands)	2017		2016		Increase (Decrease)			% Change		2018		2017		Increase (Decrease)			% Change
Real estate operating expenses	$	11,909	$	12,097	$	(188	)	(1.6	)	$	27,545	$	24,355	$	3,190		13.1
Interest expense	6,402		6,049		353			5.8		16,637		13,089		3,548			27.1
Property acquisition costs	—		953		(953		)	(100.0	)
General and administrative	2,390		2,280		110			4.8		4,756		4,987		(231		)	(4.6	)
Depreciation	7,772		5,632		2,140			38.0		17,888		14,069		3,819			27.1
Total expenses	$	28,473	$	27,011	$	1,462		5.4		$	66,826	$	56,500	$	10,326		18.3

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Real estate operating expenses.

The ~~decrease~~increase is due primarily ~~to $4.4 million related to the the ten properties sold from January 1, 2016 to December 31, 2016~~to:

~~Offsetting the decrease is an increase in of:~~

•$~~3.1~~4.6 million from seven properties acquired during the ~~nine~~twelve months ended ~~December~~March 31, ~~2016,~~2018, including $1.6 million from four properties acquired during the current period,

$~~567,000~~899,000 from the inclusion, for the entire ~~three~~six months ended March 31, ~~2017,~~2018, of three properties ~~acquired in~~that were only owned for a portion of the corresponding period of the prior year,

$577,000 from Factory at Garco Park, and

$~~305,000~~463,000 from ~~several~~ same store properties due to ~~increased real estate taxes~~a net increases in payroll, utilities and ~~repair~~repairs and maintenance ~~expense~~at several properties.

Offsetting this increase was a decrease of:

$2.1 million from the seven properties sold during the twelve months ended September 30, 2017, and

$1.3 million from three properties sold during the six months ended March 31, 2018.

Interest expense.

The increase is due primarily to:

$~~1.8 million from the mortgages on seven properties acquired during the nine months ended December 31, 2016, and~~

~~$325,000 due to the inclusion, for the entire three months ended March 31, 2017, of the mortgages on three properties acquired during the corresponding period of the prior year.~~

~~Offsetting the increase are decreases of:~~

~~$1.7 million relating to the mortgage debt on ten properties sold during the twelve months ended December 31, 2016, and~~

$175,000 relating to the decrease in the interest rate paid on our junior subordinated debt which changed on April 29, 2016 from a fixed rate of 4.91% to an adjustable rate of three month LIBOR plus 200 basis points. At March 31, 2017, the interest rate on such debt is 3.04%.

~~Property acquisition costs~~. Due to a change in accounting guidance that was adopted effective as October 1, 2016, these costs are now capitalized as a part of the basis of the acquired property. During the three months ended March 31, 2017, we capitalized $557,000 of such costs.

~~General and administrative.~~

~~The increase is due primarily to non- cash amortization of restricted stock and restricted stock unit expense and increases in salaries due to higher compensation levels.~~

~~Depreciation.~~

~~The increase is due primarily to:~~

~~$3.2~~3.7 million from seven properties acquired during the ~~nine months ended December 31, 2016, and~~

~~$418,000 from the inclusion, for the entire three~~twelve months ended March 31, ~~2017, of three~~2018, including $1.2 million from four properties acquired during the ~~corresponding~~current period, ~~of the prior year.~~

~~Offsetting the increase is a decrease of $1.5 million from ten properties sold during the twelve months ended December 31, 2016.~~

~~Other Income and Expenses~~

~~Gain on sale of real estate.~~ During the three months ended March 31, 2016, we sold two multi-family properties for an aggregate of $94.7 million and recognized an aggregate gain of $24.2 million, of which $12.2 million was allocated to the non-controlling interests. There were no sales in the current three month period.

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~~Loss on extinguishment of debt.~~ During the three months ended March 31, 2016, we incurred a $2.7 million mortgage prepayment charge in connection with the sale of a property, of which $1.5 million was allocated to the non- controlling interests. There was no comparable charge in the current three month period.

~~Provision for taxes.~~ The increase reflects state taxes paid as a result of income recognized at the state level, primarily from gains on property sales. Loss carry- forwards that are available at the federal level differ from and may not be available at the individual state level.

~~Income from discontinued operations.~~ In February 2016, we sold our interest in the Newark Joint Venture for a gain of $15.4 million and reclassified the operations of the venture to discontinued operations for the quarter ended March 31, 2016.

~~Net loss (income) attributable to non-controlling interest.~~ This category represents our joint venture partners share of income including gains and early extinguishment of debt. During the three months ended March 31, 2016, we sold two multi-family properties and allocated $12.2 million of the gain and $1.5 million of the loss on extinguishment of mortgage debt to our partner. There were no sales in the current period.

~~Results of Operations~~ ~~– Six months ended March 31, 2017 compared to six months ended March 31, 2016.~~

~~Revenues~~

~~The following table compares our revenues for the periods indicated:~~

Six Months Ended
March 31,
(Dollars in thousands): 2017 2016 Increase
%
Change
Rental and other revenues from real estate properties $ 49,731
$ 46,312
$ 3,419
7.4
Other income 792
2,033
(1,241 ) (61.0 )
Total revenues $ 50,523
$ 48,345
$ 2,178
4.5

~~Rental and other revenues from real estate properties.~~

~~The increase is due primarily to:~~

$~~11.1 million from six properties acquired during the six months ended September 30, 2016,~~

~~$3.8 million~~632,000 from the inclusion, for the entire six months ended March 31, ~~2017,~~2018, of ~~four~~three properties that were only owned for a portion of the corresponding period in the prior year,

$~~1.7 million~~455,000 from ~~three properties acquired~~Factory at Garco Park - the interest expense at this property in the ~~six months ended March 31,~~ 2017 period was capitalized as the property was then in development, and

$~~1.4 million~~121,000 from ~~same store properties due primarily to a net~~an increase in ~~rental rates at a several multi-family properties.~~

the rate paid on our subordinated debt.

Offsetting this increase ~~are decreases~~was a decrease of:

$~~11.0 million of rental revenue~~816,000 from the ~~six~~seven properties sold during the twelve months ended September 30, ~~2016,~~2017, and

$~~3.6 million~~513,000 from ~~four~~three properties sold during the six months ended March 31, ~~2017.~~

2018.

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~~Other Income.~~

General and administrative expense. The decrease is due primarily to the inclusion, in the ~~corresponding period~~six months ended March 31, 2017, of ~~the prior year,~~approximately $250,000 of ~~$1.9 million~~professional and other fees, a significant portion of ~~interest that had been deferred and not recognized for several years on the $19.5 million loan~~which related to ~~the Newark Joint Venture.~~our conversion to a Maryland corporation.

~~Expenses~~

~~The following table compares our expenses for the periods indicated:~~

Six Months Ended
March 31,
(Dollars in thousands) 2017 2016
Increase
(Decrease)
% Change
Real estate operating expenses 24,355
23,191
$ 1,164
5.0
Interest expense 13,089
11,580
1,509
13.0
Advisor’s fees, related party —
693
(693 ) (100.0 )
Property acquisition costs —
1,010
(1,010 ) (100.0 )
General and administrative 4,987
4,029
958
23.8
Depreciation 14,069
10,616
3,453
32.5
Total expenses $ 56,500
$ 51,119
$ 5,381
10.5

~~Real estate operating expenses.~~ Depreciation.

The increase is due primarily to:

•$~~5.7~~5.3 million from ~~six~~seven properties acquired induring the ~~six~~twelve months ended ~~September 30, 2016,~~March 31, 2018, including $1.7 million from four properties acquired during the current period,

$~~1.9 million~~806,000 from the inclusion, for the entire six months ended March 31, ~~2017,~~2018, of ~~four~~three properties that were only owned for a portion of the corresponding period in the prior year,

~~$802,000 from several same store properties, including approximately $400,000 due to increased real estate taxes and approximately $276,000 due to increased repair and maintenance expense,~~ and

$~~536,000~~676,000 from our Factory at Garco Park that was in development during the corresponding period of the prior year .

Offsetting this increase was a decrease of:

$1.4 million resulting from purchase price allocation adjustments in the corresponding period of the prior year,

$1.0 million from three properties ~~acquired~~sold during the six months ended March 31, ~~2017.~~

~~Offsetting the increase is a net decrease of:~~2018, and

$~~6.0 million relating to six~~517,000 from the seven properties sold during the twelve months ended September 30, ~~2016, and~~

~~$1.8 million from four properties sold during the six months ended March 31,~~ 2017.

~~Interest expense~~.

~~The increase is due primarily to:~~

~~$3.1 million due to mortgages on six properties acquired during the six months ended September 30, 2016,~~

~~$1.2 million from the inclusion, for the full six months ended March 31, 2017, of the mortgages on four properties that were owned for a portion of the corresponding period in the prior year, and~~

~~$605,000 from the mortgages on three properties acquired during the six months ended March 31, 2017.~~

~~Offsetting the increase are decreases of:~~

~~$2.5 million relating to the mortgage debt on six properties sold during the twelve months ended September 30, 2016,~~

~~$611,000 from mortgages on four properties sold during the six months ended March 31, 2017, and~~

~~$452,000 due to the decrease in the interest rate paid on our junior subordinated debt.~~

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~~Advisor’s fees, related party. The 2016 period reflects the amounts paid during the three months ended December 31, 2015, at which time the advisory agreement terminated.~~

~~Property acquisition costs~~. Due to a change in accounting guidance that was adopted as of October 1, 2016, these costs are now capitalized as a part of the basis of the acquired property. During the six months ended March 31, 2017, we capitalized $1.2 million of such costs.

~~General and administrative.~~ Approximately $498,000 of the increase is due of the inclusion of the fees for services previously provided pursuant to the advisory agreement, approximately $302,000 is due to increased compensation expense (including $292,000 related to the non-cash amortization of restricted stock and restricted stock unit expense and $160,000 due to increased salaries) and $190,000 of various other expenses, including expenses related to the conversion.

~~Depreciation.~~ The increase is due primarily to $4.8 million from six properties acquired during the twelve months ended March 31, 2017, $1.5 million from the inclusion for the full six months of four properties that were owned for a portion of the corresponding period in the prior period and $519,000 from same store sales related to purchase price allocation adjustments. Offsetting the increase are decreases of $1.9 million from six properties sold during the twelve months ended September 30, 2016 and $1.3 million related to four properties sold during the six months ended March 31, 2017.

Other Income and Expenses

Gain on sale of real estate. During the six months ended March 31, 2018, we sold three multi-family properties and one cooperative apartment unit for an aggregate sales price of $171.0 million and recognized an aggregate gain of $64.5 million, of which $27.4 million was allocated to the non-controlling partners. During the six months ended March 31, 2017, we sold four ~~multi family~~multi-family properties and a cooperative apartment unit for an aggregate sales price of $130.7 million and recognized an aggregate gain of $35.8 million, of which $17.1 million was allocated to the non-controlling ~~interests. The corresponding period~~partner.

Table of the prior year includes the sale of two multi-family properties and a coop apartment unit which were sold for a gain of $24.8 million, of which $12.0 million was allocated to the non controlling interest.Contents

Loss on extinguishment of ~~debt.~~ debt~~During~~. In the six months ended March 31, 2018, we incurred $850,000 of mortgage prepayment charges in connection with the sale of The Fountain Apartments and Waverly Place Apartments . In the six months ended March 31, 2017, ~~and 2016,~~ we incurred a $799,000 ~~and $2.7 million~~ of mortgage prepayment charges ~~respectively,~~ in connection with ~~property sales.~~the sale of Spring Valley Apartments, Panama City, FL.

~~Provision for taxes~~Income tax (benefit) provision. ~~. This amount reflects (i) $350,000 of Federal alternative minimum tax resulting from~~In the ~~use of our loss carry-forwards to offset 2016 Federal taxable income and (ii) $1.1 million~~six months ended March 31, 2018, we received a refund of state taxes ~~from~~related to a prior year. The six months ended March 31, 2017 reflects state taxes paid as a result of income recognized at the state level, primarily from gains on property sales. ~~Loss carry- forwards that are available at the federal level differ from and may not be available at the individual state level.~~

~~Income from discontinued operations.~~ ~~In February 2016, we sold our interest in the Newark Joint Venture and reclassified the operations of the venture to discontinued operations for the six months ended March 31, 2016.~~

~~Net (income) loss attributable to non-controlling interest.~~ The amount is primarily due to the allocation to our joint venture partners of their share of the gain on sale of four multi-family properties in the six months ended March 31, 2017 and two multi-family properties in the corresponding period in the prior year.

Liquidity and Capital Resources

We require funds to pay operating expenses and debt service obligations, acquire properties, ~~repay borrowings~~make capital improvements and pay ~~operating expenses.~~dividends. Generally, our primary sources of capital and liquidity are the operations of, and distributions from, our multi-family properties, our available cash (including restricted cash), mortgage debt financing and our share of the net proceeds from the sale of multi-family properties. As a result of the at-the-market equity offering program that commenced January 11, 2018, we may, in the future, generate funds from the sale of our common stock. At March 31, ~~2017~~2018, and May 1, ~~2017,~~2018, our available cash, excluding restricted cash of ~~$6.6~~$7.7 million and $7.9 million respectively, intended for capital improvements at 1517 multi-family properties, is approximately ~~$43.1~~$31.0 million and ~~$ 34.4~~$20.4 million, respectively.

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We anticipate that operating expenses ~~and debt service~~ payable through ~~2018~~2019 will be funded from the cash generated from operations of ~~these~~our properties and that the debt service (including principal payments) payable in 2018 and 2019 will be funded from the cash generated from operations of the properties, the refinancing of mortgages, our share of the proceeds from the sale of our properties and from sales of our common stock, if ~~needed, supplemental financings.~~any.

The mortgage debt with respect to the multi-family properties generally is non-recourse to us and our subsidiary holding our interest in the applicable joint venture. Our ability to acquire additional multi-family properties is limited by our available cash and the availability of mortgage debt.

We anticipate that the construction and other costs associated with the ~~N. Charleston, SC~~402-unit Bells Bluff development project will be funded by capital previously contributed by us and our joint venture partner ~~and us~~ and in-place construction financing of up to ~~$30.3~~$47.4 million. As of March 31, ~~2017, $25.4~~2018, there have been no draws against this construction loan.

We intend to refinance the adjustable rate mortgages in aggregate principal amount of $56.3 million at our two properties that are currently in lease up (Factory at Garco Park - N. Charleston, SC and Vanguard Heights, Creve Coeur, MO) with longer term fixed-rate financing once these properties has been ~~drawn against the project.~~stabilized; however, no assurance can be given that these properties will ever be stabilized, that financing will be available at such time or, if available, that it will be on terms acceptable to us. These loans mature (after giving effect to extension options) in October 2020 and April 2019, respectively.

~~Statements of Cash Flows~~

As of March 31, 2017 and 2016, we had cash and cash equivalents of $43.1 million and $34.7 million, respectively. Our cash and cash equivalents were generated from the following activities (dollars in thousands):

Six Months Ended
March 31,
2017 2016
Cash flow from operating activities $ 11,566
$ 9,498
Cash flow provided by (used in) investing activities 62,773
(16,342 )
Cash flow (used in) provided by from financing activities (58,591 ) 26,080
Net change in cash and cash equivalents 15,748
19,236
Cash and cash equivalents a beginning of period 27,399
15,556
Cash and cash equivalents at end of year $ 43,147
$ 34,792

~~The increase in cash flow provided by operating activities in 2017 is due to increased total revenues at our operating properties.~~

The increase in cash flow provided by investing activities in 2017 is due primarily to the increase in proceeds from property sales, the paydown of the loan to the Newark Joint Venture, and a reduction in the properties purchased.

~~The decrease in cash flow used in financing activities in 2017 is due primarily to a reduced amount of mortgages obtained due to fewer purchases in the current six months.~~

Cash Distribution Policy

We ~~have~~are taxed as a REIT under the Internal Revenue Code of 1986, as amended, which we refer to as the “Code”. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute to our stockholders within the time frames prescribed by the Code at least 90% of our ordinary taxable income. Management currently intends to maintain our REIT status. As a REIT, we generally will not ~~paid cash dividends since 2010. At December 31, 2016,~~be subject to corporate Federal income tax on taxable income we distribute to stockholders in accordance with the Code. If we fail to qualify as a REIT in any taxable year, we will be subject to Federal income taxes at regular corporate rates and may not be able to qualify as a REIT for four subsequent tax years. Even if we qualify for Federal taxation as a REIT, we are subject to certain state and local taxes on our income and to Federal income and excise taxes on undistributed taxable income,(i.e., taxable income not distributed in the amounts and in the time frames prescribed by the Code).

We estimate that our net operating ~~loss carry-forward is approximately~~losses at December 31, 2017 range from $15 million to ~~$18 million. Accordingly,~~$20 million; therefore, we are not currently required by ~~the Internal Revenue~~ Code provisions relating to REITs to pay ~~a dividend~~cash dividends to maintain our ~~REIT status.~~status as a REIT. Notwithstanding the foregoing, on each of October 5, 2017 and January 5, 2018, we paid a cash dividend of $0.18 per share, and on April 6, 2018, we paid a cash dividend of $0.20 per share. Though we currently intend to continue to pay cash dividends on a quarterly basis, we cannot provide any assurance that we will do so.

Off Balance Sheet Arrangements

None.

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Funds from Operations; Adjusted Funds from Operations

We disclose below funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) because we believe that such metrics are a widely recognized and appropriate measure of the performance of an equity REIT.

We compute FFO in accordance with the “White Paper on Funds From Operations” issued by the National Association of Real Estate Investment Trusts (“NAREIT”) and NAREIT’s related guidance. FFO is defined in the White Paper as net income (computed in accordance with generally accepting accounting principles), excluding gains (or losses) from sales of property, plus depreciation and amortization, plus impairment write‑downs of depreciable real estate and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures ~~will be~~are calculated to reflect funds from operations on the same basis. In computing FFO, we do not add back to net income the amortization of costs in connection with our financing activities or depreciation of ~~non‑~~non- real estate assets.We compute AFFO by deducting from FFO our straight-line rent accruals, ~~and deferrals, amortization~~loss on extinguishment of debt, restricted stock ~~compensation~~ and ~~amortization of~~restricted stock unit expense, deferred ~~financing costs.~~mortgage costs and gain on insurance recovery. Since the NAREIT White Paper only provides guidelines for computing FFO, the computation of AFFO may vary from one REIT to another.

We believe that FFO and AFFO are useful and standard supplemental measures of the operating performance for equity REITs and are used frequently by securities analysts, investors and other interested parties in evaluating equity REITs, many of which present FFO and AFFO when reporting their operating results. FFO and AFFO are intended to exclude GAAP historical cost depreciation and amortization of real estate assets, which assumes that the value of real estate assets diminish predictability over time. In fact, real estate values have historically risen and fallen with market conditions. As a result, we believe that FFO and AFFO provide a performance measure that when compared year over year, should reflect the impact to operations from trends in occupancy rates, rental rates, operating costs, interest costs and other matters without the inclusion of depreciation and amortization, providing a perspective that may not be necessarily apparent from net income. We also consider FFO and AFFO to be useful to us in evaluating potential property acquisitions.

FFO and AFFO do not represent net income or cash flows from operations as defined by GAAP. FFO and AFFO should not be considered to be an alternative to net income as a reliable measure of our operating performance; nor should FFO and AFFO be considered an alternative to cash flows from operating, investing or financing activities (as defined by GAAP) as measures of liquidity. FFO and AFFO do not measure whether cash flow is sufficient to fund all of our cash needs, including principal amortization and capital improvements. FFO and AFFO do not represent cash flows from operating, investing or financing activities as defined by GAAP.

Management recognizes that there are limitations in the use of FFO and AFFO. In evaluating our performance, management is careful to examine GAAP measures such as net income and cash flows from operating, investing and financing activities.

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The table below provides a reconciliation of net loss determined in accordance with ~~GAAP~~Generally Accepted Accounting Principles ("GAAP") to FFO and AFFO for each of the indicated periods (amounts in thousands):

Three Months Ended
March 31, Six Months Ended
March 31,
2017 2016 2017 2016
GAAP Net (loss) income attributable to common stockholders $ (4,229 ) $ 24,936
$ 11,541
$ 22,902
Add: depreciation of properties 7,772
6,104
14,069
11,765
Add: our share of depreciation in unconsolidated joint ventures 130
5
213
10
Add: amortization of deferred leasing costs —
1
—
15
Deduct: gains on sale of real estate and partnership interest —
(39,693 ) (35,838 ) (40,302 )
Adjustments for non-controlling interests (1,923 ) 10,823
13,651
9,438
NAREIT Funds from operations attributable to common stockholders 1,750
2,176
3,636
3,828

Adjustments for: straight line rent accruals (14 ) (67 ) (36 ) (129 )
Add: loss on extinguishment of debt —
2,668
799
2,668
Add: amortization of restricted stock and restricted stock units 386
188
710
418
Add: amortization of deferred mortgage costs 224
483
525
1,168
Adjustments for non-controlling interests (44 ) (1,677 ) (469 ) (1,916 )
Adjusted funds from operations attributable to common stockholders $ 2,302
$ 3,771
$ 5,165
$ 6,037

Three Months Ended
March 31, Six Months Ended
March 31,
2017 2016 2017 2016
GAAP Net (loss) income attributable to common stockholders $ (0.30 ) $ 1.76
$ 0.83
$ 1.62
Add: depreciation of properties 0.55
0.43
1.01
0.83
Add: our share of depreciation in unconsolidated joint ventures 0.01
—
0.02
—
Add: amortization of deferred leasing costs —
—
—
—
Deduct: gain on sale of real estate and partnership interest —
(2.81 ) (2.58 ) (2.85 )
Adjustment for non-controlling interests (0.14 ) 0.77
0.98
0.67
NAREIT Funds from operations per common stock basic and diluted 0.12
0.15
0.26
0.27

Adjustments for: straight line rent accruals —
(0.01 ) —
(0.01 )
Add: loss on extinguishment of debt —
0.19
0.06
0.19
Add: amortization of restricted stock and restricted stock units 0.03
0.01
0.05
0.03
Add: amortization of deferred mortgage costs 0.02
0.03
0.04
0.08
Adjustments for non-controlling interests (0.01 ) (0.12 ) (0.04 ) (0.14 )
Adjusted funds from operations per common stock basic and diluted $ 0.16
$ 0.25
$ 0.37
$ 0.42



	Three Months Ended March 31,						Six Months Ended March 31,
	2018			2017			2018			2017
GAAP Net income attributable to common stockholders	$	25,222		$	(4,229	)	$	31,573		$	11,541
Add: depreciation of properties	9,240			7,772			17,888			14,069
Add: our share of depreciation in unconsolidated joint ventures	447			130			816			213
Deduct: gain on sale of real estate	(51,981		)	—			(64,500		)	(35,838		)
Adjustments for non-controlling interests	22,406			(1,923		)	22,596			13,651
NAREIT Funds from operations attributable to common stockholders	5,334			1,750			8,373			3,636

Adjustments for: straight-line rent accruals	(10		)	(14		)	(20		)	(36		)
Add: loss on extinguishment of debt	593			—			850			799
Add: amortization of restricted stock and restricted stock units	297			386			612			710
Add: amortization of deferred mortgage costs	373			224			732			525
Deduct gain on insurance recovery	(3,227		)	—			(3,227		)	—
Adjustments for non-controlling interests	434			(44		)	307			(469		)
Adjusted funds from operations attributable to common stockholders	$	3,794		$	2,302		$	7,627		$	5,165



	Three Months Ended March 31,						Six Months Ended March 31,
	2018			2017			2018			2017
GAAP Net income attributable to common stockholders	$	1.75		$	(0.30	)	$	2.21		$	0.83
Add: depreciation of properties	0.64			0.55			1.23			1.01
Add: our share of depreciation in unconsolidated joint ventures	0.03			0.01			0.06			0.02
Deduct: gain on sale of real estate	(3.60		)	—			(4.50		)	(2.58		)
Adjustment for non-controlling interests	1.55			(0.14		)	1.58			0.98
NAREIT Funds from operations per common stock basic and diluted	0.37			0.12			0.58			0.26

Adjustments for: straight line rent accruals	—			—			—			—
Add: loss on extinguishment of debt	0.04			—			0.06			0.06
Add: amortization of restricted stock and restricted stock units	0.01			0.03			0.04			0.05
Add: amortization of deferred mortgage costs	0.03			0.02			0.05			0.04
Deduct gain on insurance recovery	(0.22		)	—			(0.22		)	—
Adjustments for non-controlling interests	0.03			(0.01		)	0.02			(0.04		)
Adjusted funds from operations per common stock basic and diluted	$	0.26		$	0.16		$	0.53		$	0.37

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Item 3. Quantitative and Qualitative Disclosures About Market Risks

All of our mortgage debt is fixed rate, other than ~~four~~seven mortgages, three of which are subject to interest rate swap ~~agreements.~~agreements and one which is subject to an interest rate cap. With respect to the remaining three variable rate ~~mortgage,~~mortgages, an increase of 100 basis points in interest rates would reduce annual net income by ~~$254,000~~$589,000 and a decrease of 100 basis points would increase annual net income by ~~$236,000.~~$589,000.

As of March 31, ~~2017,~~2018, we had three interest rate swap agreements ~~outstanding.~~outstanding and one interest rate cap. The fair value of ~~our interest rate swaps~~these derivative instruments is dependent upon existing market interest rates and swap spreads, which change over time. At March 31, ~~2017,~~2018, if there had been (i) an increase of 100 basis points in forward interest rates, the fair market value of these derivative instruments and the ~~interest rate swaps and~~ net unrealized gain ~~on the derivative instruments~~thereon would have increased by approximately ~~$5.5~~$3.0 million and (ii) if there had been a decrease of 100 basis points in forward interest rates, the fair market value of these derivatives and the ~~interest rate swaps and~~ net unrealized gain ~~on derivative instrument~~thereon would have decreased by approximately ~~$1.8~~$3.2 million. These changes would not have any impact on our net income or cash.

Our junior subordinated notes bear interest at the rate of three month LIBOR plus 200 basis points. At March 31, 2018, the interest rate on these notes was 3.77%. A 100 basis point increase in the rate would increase our related interest expense by approximately $374,000 annually and a 100 basis point decrease in the rate would decrease our related interest expense by ~~$422,000~~$374,000 annually.

As of March 31, ~~2017,~~2018, based on the number of residential units in each state, ~~31%~~30% of our properties are located in Texas, ~~12%~~16% in Georgia, 11% in Florida, ~~11%~~8% in ~~Georgia, 9% in Alabama, 9%~~Missouri, 8% in Mississippi, 8%7% in Tennessee, 7% in South Carolina and the remaining ~~20%~~13% in ~~five~~four other ~~states and~~states; we are therefore subject to risks associated with the economies in these areas.

Item 4. Controls and Procedures

As required under Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, we carried out an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer, Senior Vice President-Finance and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, ~~2017.~~2018. Based upon that evaluation, the Chief Executive Officer, Senior Vice President-Finance and Chief Financial Officer concluded that our disclosure controls and procedures as of March 31, ~~2017~~2018 are effective.

There have been no changes in our internal control over financial reporting during the quarter ended March 31, ~~2017~~2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

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Part II - Other Information

~~Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.~~

On March 11, 2016, our Board of Trustees authorized us to repurchase up to $5.0 million of our shares through September 30, 2017. The table below provides information regarding our repurchase of our common shares pursuant to such authorization.

Period
(a)

Total Number of Shares (or Units) Purchased
(b)

Average Price Paid per Share
(or Unit)
(c)

Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
(d)

Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
January 1 - January 31, 2017 —
$ —
—
$ 4,459,759
February 1 - February 28, 2017 —
—
—
4,459,759
March 1 - March 31, 2017 4,575
8.28
4,575
4,421,892
Total 4,575
—
4,575

~~Table of Contents~~

Item 6. Exhibits



Exhibit No.		Title of Exhibits
31.1		Certification of President and Chief Executive Officer pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002
31.2		Certification of Senior Vice President—Finance pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002
31.3		Certification of Vice President and Chief Financial Officer pursuant to Section 302 of the Sarbanes‑Oxley Act of 2002
32.1		Certification of President and Chief Executive Officer pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002
32.2		Certification of Senior Vice President—Finance pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002
32.3		Certification of Vice President and Chief Financial Officer pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Definition Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

~~____________________~~

_____________________

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SIGNATURES

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

BRT APARTMENTS CORP.

~~(Registrant)~~





May ~~10, 2017~~8, 2018	/s/ Jeffrey A. Gould
	Jeffrey A. Gould, President and
	Chief Executive Officer





May ~~10, 2017~~8, 2018	/s/ George Zweier
	George Zweier, Vice President
	and Chief Financial Officer
	(principal financial officer)

3429



	March 31, 2017			September 30, 2016
Mortgages payable (a)	$	608,429		$	621,382
Junior subordinated notes	37,400			37,400
Deferred mortgage costs	(5,688		)	(6,275		)
Total debt obligations, net of deferred costs	$	640,141		$	652,507



	Three Months Ended March 31, 2017
	Multi-Family Real Estate			Other Assets			Total
Revenues:
Rental and other revenues from real estate properties	$	24,318		$	384		$	24,702
Other income	(9		)	190			181
Total revenues	24,309			574			24,883
Expenses:
Real estate operating expenses	11,749			160			11,909
Interest expense	5,870			532			6,402
General and administrative	2,343			47			2,390
Depreciation	7,745			27			7,772
Total expenses	27,707			766			28,473
Loss from continuing operations	(3,398		)	(192		)	(3,590		)
Provision for taxes	1,086			22			1,108
Loss from continuing operation, net of taxes	(4,484		)	(214		)	(4,698		)
Net loss (income) attributable to non-controlling interests	502			(33		)	469
Net loss attributable to common stockholders	$	(3,982	)	$	(247	)	$	(4,229	)
Segment Assets at March 31, 2017	$	853,226		$	17,294		$	870,520



	Three Months Ended March 31, 2016
	Multi-Family Real Estate			Other Assets		Total
Revenues:
Rental and other revenues from real estate properties	$	23,635		$	358	$	23,993
Other income	—			2,026		2,026
Total revenues	23,635			2,384		26,019
Expenses:
Real estate operating expenses	11,955			142		12,097
Interest expense	6,028			21		6,049
Property acquisition costs	953			—		953
General and administrative	2,234			46		2,280
Depreciation and amortization	5,605			27		5,632
Total expenses	26,775			236		27,011
Total revenues less total expenses	(3,140		)	2,148		(992		)
Gain on sale of real estate assets	24,226			—		24,226
Loss on extinguishment of debt	(2,668		)	—		(2,668		)
Income from continuing operations	18,418			2,148		20,566
Net (income) loss attributable to non-controlling interests	(10,581		)	672		(9,909		)
Net income attributable to common stockholders before reconciling adjustment	$	7,837		$	2,820	$	10,657
Reconciling adjustment:
Discontinued operations, net of non-controlling interest						14,279
Net income attributable to common stockholders						$	24,936
Segment Assets at March 31, 2016	$	722,338		$	30,637	$	752,975



	Six Months Ended March 31, 2017
	Multi-Family Real Estate			Other Assets			Total
Revenues:
Rental and other revenues from real estate properties	$	48,960		$	771		$	49,731
Other income	(9		)	801			792
Total revenues	48,951			1,572			50,523
Expenses:
Real estate operating expenses	24,099			256			24,355
Interest expense	11,962			1,127			13,089
General and administrative	4,887			100			4,987
Depreciation	14,015			54			14,069
Total expenses	54,963			1,537			56,500
Total revenue less total expenses	(6,012		)	35			(5,977		)
Gain on sale of real estate	35,389			449			35,838
Loss on extinguishment of debt	(799		)	—			(799		)
Income from continuing operations	28,578			484			29,062
Provision for taxes	1,429			29			1,458
Income from continuing operations, net of taxes	27,149			455			27,604
Net loss attributable to non-controlling interests	(15,995		)	(68		)	(16,063		)
Net income attributable to common stockholders	$	11,154		$	387		$	11,541
Segment Assets at March 31, 2017	$	853,226		$	17,294		$	870,520



	Six Months Ended March 31, 2016
	Multi-Family Real Estate			Other Assets		Total
Revenues:
Rental and other revenues from real estate properties	$	45,639		$	673	$	46,312
Other income	—			2,033		2,033
Total revenues	45,639			2,706		48,345
Expenses:
Real estate operating expenses	22,899			292		23,191
Interest expense	11,487			93		11,580
Advisor's fee, related party	594			99		693
Property acquisition costs	1,010			—		1,010
General and administrative	3,895			134		4,029
Depreciation	10,563			53		10,616
Total expenses	50,448			671		51,119
Total revenue less total expenses	(4,809		)	2,035		(2,774		)
Gain on sale of real estate	24,226			609		24,835
Loss on extinguishment of debt	(2,668		)	—		(2,668		)
Income from continuing operations	16,749			2,644		19,393
Net (income) loss attributable to non-controlling interests	$	(10,780	)	$	1,610	(9,170		)
Net income attributable to common stockholders before reconciling adjustment	$	5,969		$	4,254	10,223
Reconciling adjustment:
Discontinued operations, net of non-controlling interest						12,679
Net income attributable to common stockholders						$	22,902
Segment Assets at March 31, 2016	$	722,338		$	30,637	$	752,975



Period	(a) Total Number of Shares (or Units) Purchased	(b) Average Price Paid per Share (or Unit)		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
January 1 - January 31, 2017	—	$	—	—	$	4,459,759
February 1 - February 28, 2017	—	—		—	4,459,759
March 1 - March 31, 2017	4,575	8.28		4,575	4,421,892
Total	4,575	—		4,575