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Board ofExecutive Officers and Trustees

The members of the Board ofExecutive Officers and Trustees of the Trust are:

There are no family relationships among the Trustees and the Executive Officers, except that Robert S. Hekemian, Jr., a Trustee of the Trust, is the son of Robert S. Hekemian, the Trust’s Chairman of the Board and Chief Executive Officer. During the past five years, none of the nominees for Trustee or Executive Officers of the Trust have served as directors of any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940, as amended, except Robert S. Hekemian, Jr., who is a director of Oritani Financial Corp. (ORIT)(ORIT), the holding company for Oritani Bank, of which he is also a director, and Ronald J. Artinian, who served as a director of CommonWealth REIT (CWH) during 2014, and who servedThe Reserve, The Reserve Primary Fund in Liquidation and The Reserve Yield Plus Fund in Liquidation, which are registered investment companies, from 2006 to 2016.

Each of the Executive Officers of the Trust serves in his office(s) until such time as a director of NYMAGIC, Inc. (NYM), an insurance holding company, from 2008 until 2010.his successor is elected and qualified.

Biographical Information

Robert S. Hekemian has been active in the real estate industry for more than 5758 years. Mr. Hekemian has served as Chairman of the Board and Chief Executive Officer of the Trust since 1991, and as a Trustee since 1980. From 1981 to 1991, Mr. Hekemian was President of the Trust. From 2002 to 2003, Mr. Hekemian served as Chief Financial Officer of the Trust. His current term as a member of the Board of Trustees is scheduled to expire in April 2017.at the Annual Meeting. Since 1983, Mr. Hekemian has also been the Chairman of the Board and Chief Executive Officer of Hekemian & Co., Inc. (“Hekemian & Co.”), a real estate brokerage and management company

which manages the Trust’s properties and owns and develops real estate assets throughout the Northeast and Mid-Atlantic regions of the United States. Mr. Hekemian isserved as a director of Pascack Community Bank.Bank prior to its merger with and into Lakeland Bank on January 7, 2016. See the section entitled “Certain Relationships and Related Party Transactions” in this Proxy Statement. He is also a director, a partner and an officer in numerous private real estate corporations and partnerships.

Donald W. Barney has served as President of the Trust since 1993, as Treasurer and Chief Financial Officer of the Trust since 2003, and as a Trustee since 1981. His current term as a member of the Board of Trustees is scheduled to expire at the Annual Meeting.in April 2018. Mr. Barney was associated with Union Camp Corporation, a diversified manufacturer of paper, packaging products, chemicals and wood products, from 1969 through 1998 in various positions, including Vice President and Treasurer. Mr. Barney is also a partner and director in several private real estate investment companies.

Herbert C. Klein, Esq., has served continuously as a Trustee since 1961 except for the two-year period from January 1993 to January 1995 when Mr. Klein served as an elected member of the United States Congress, House of Representatives, for the 8th Congressional District of New Jersey. His current term as a member of the Board of Trustees is scheduled to expire at the Annual Meeting.in April 2018. From 1991 through the end of 1992, Mr. Klein served as President of the Trust. Mr. Klein has been an attorney since 1956 with a practice devoted to real estate, corporate matters and government relations. Since January 1999, Mr. Klein has beenwas a Partner in the law firm of Nowell Amoroso Klein Bierman P.A., with offices located in Hackensack, New Jersey and New York City. See from 1999 to 2015. Mr. Klein is currently Of Counsel to the section entitled “Certain Relationships and Related Party Transactions” in this Proxy Statement.law firm of Genova Burns LLC. Mr. Klein is a former member of the New Jersey State Assembly. Mr. Klein is also a partner and principal in numerous private investment real estate companies. He is a member of the Board of Overseers of the Rutgers University Foundation (the “Foundation”), a member of the Executive Committee of the Board of Directors of the Foundation, a member of the Chairman’s Advisory Committee of the National Democratic Institute, a member of the Board of the Montclair Art Museum, and a member of the board of directors of numerous philanthropic organizations.

Ronald J. Artinian has served as a Trustee since 1992. His current term as a member of the Board of Trustees is scheduled to expire in April 2016.2019. Mr. Artinian worked in the financial services industry for 26 years, including with Smith Barney, Inc. from 1989 to 1998, where Mr. Artinian held positions as a Managing Director and National Sales Manager. Mr. Artinian retired from Smith Barney in January 1998 in order to pursue other business interests as a private investor. Mr. Artinian joined the board of The Reserve, a money market fund, in 2007. Mr. Artinian served as a member of the board of NYMAGIC, Inc., an insurance holding company specializing in commercial lines property and casualty and ocean marine insurance, from 2008 until the sale of that company in 2010.

Alan L. Aufzien has served as a Trustee since 1992. His current term as a member of the Board of Trustees is scheduled to expire in April 2016.2019. Since 1986, Mr. Aufzien has been Chairman and Managing Partner of The Norall Organisation, an investment company. From 1980 to 1998, Mr. Aufzien was a partner in the Meadowlands Basketball Association, t/a New Jersey Nets (member of the National Basketball Association, now known as the Brooklyn Nets), and was its Chairman and Chief Executive Officer, and then its Secretary and Treasurer, as well as a member of its Board of Directors.

David F. McBride, Esq. has served as a trusteeTrustee since 2007. His current term as a member of the Board of Trustees is scheduled to expire in April 2017.at the Annual Meeting. Mr. McBride brings to the Boardhas over 40 years of diversified real estate experience. He is the Chief Executive Officer of McBride Enterprises, Inc., a family ownedfamily-owned real estate company started in 1898. Mr. McBride was responsible for the development of numerous office and industrial properties, as well as residential projects in Northern New Jersey. He also oversaw the operations of his family’s general construction company, the Alpert P. Schmidt Construction Company, civil engineering firm, Urban Planning and Engineering Company, and commercial brokerage firm, McBride Corporate Real Estate. Mr. McBride was also instrumental in forming the Keystone Property Trust (NYSE) in 1998 and served as its Chairman of the Board until its sale to ProLogis (NYSE) in 2004. Mr. McBride has also been a Partner in and is presently Of Counsel to the law firm of Harwood Lloyd, LLC, specializing in real estate matters. Since 1998, Mr. McBride has also served as the Chairman and President of the Mountain Club Inc., t/a The High Mountain Golf Club. Mr. McBride also serves on the Advisory Board of the McDonough School of Business at Georgetown University.

Robert S. Hekemian, Jr. has served as a trusteeTrustee since 2007. His current term as a member of the Board of Trustees is scheduled to expire in April 2017.at the Annual Meeting. Mr. Hekemian has been involved in real estate activities for over 25 years, including property management, leasing, mortgage financing, construction and acquisitions of residential and commercial properties located throughout the Northeast and Mid-Atlantic regions of the United States. He has served as President and Chief Operating Officer of Hekemian & Co. since 2004. From 1983 to 2003, Mr. Hekemian served as Executive Vice President of Hekemian & Co. Mr. Hekemian is principally responsible for identifying real estate acquisitions and evaluating the performance of the real estate properties managed by Hekemian & Co. with a view toward maintaining or altering management and/or leasing strategies. Mr. Hekemian also serves on the Boards of Directors of Oritani Bank and Oritani Financial Corp., the holding company for the bank, and the New York Philharmonic. Mr. Hekemian is Chairman of the Bergen Community College Foundation. He is a Member of the Board of Governors, Hackensack University Medical Center, and a Trustee of the Hackensack University Medical Center Foundation.

Executive Officers

Each of the Executive Officers of the Trust serves in his office(s) until such time as his successor is elected and qualified.

Biographical Information

Please see “Board of Trustees” above for biographical information for Robert S. Hekemian and Donald W. Barney.

John A. Aiello, Esq. has served as the Secretary and Executive Secretary of the Trust since 2003.2003 and as a member of the Board of Trustees since December 2015. His current term as a member of the Board of Trustees is scheduled to expire in April 2018. Mr. Aiello is aan officer and shareholder and officer atof the law firm of Giordano, Halleran & Ciesla, P.C., where he has practiced law for 42 years. He is Chairman of the law firm’s Corporate and Securities practice group and concentrates his practice on corporate and securities law matters, including mergers and acquisitions and various corporate finance transactions. See the section entitled “Certain Relationships and Related Party Transactions” in this Proxy Statement. Mr. Aiello is a member and former Chairman of the Board of Directors of the Business Law Section of the New Jersey State Bar Association and a member of the Board of Directors of the New Jersey chapter of the Association for Corporate Growth, a non-profit organization of professionals and business leaders in the middle market mergers and acquisitions space. Mr. Aiello is also a member of the Monmouth University Business Council.

Justin F. Meng has served as a member of the Board of Trustees since February 2016.  His current term as a member of the Board of Trustees is scheduled to expire in April 2019. Mr. Meng is a Managing Partner at V3 Capital Management L.P., an investment firm

focused on publicly-traded real estate securities that he co-founded in 2011.  Previously, he was Partner and Head of REIT Research for High Rise Capital Management, L.P., where he worked from 2005 to 2011.  From 2002 to 2005, Mr. Meng served as an Associate at J.P. Morgan Asset Management in the Real Estate Investment Group, where he worked both in the acquisitions and asset management departments.  From 2000 to 2002, he served as an Analyst at J.P. Morgan Asset Management in their Fixed Income Group. Mr. Meng is a CFA charterholder.

Meetings of the Board of Trustees

During the fiscal year ended October 31, 2014,2016, the Board of Trustees held thirteenten meetings and acted by unanimous written consent on one occasion.three occasions. During fiscal 2014,2016, each incumbent member of the Board of Trustees attended at least 75%of the aggregate number of (i) meetings of the Board of Trustees and (ii) meetings of the committees of the Board of Trustees on which he served. John A. Aiello, Secretary and Executive Secretary of the Trust, attends meetings of the Board of Trustees and each of its committees in a non-voting capacity.

Trustee Attendance at Annual Meeting

The Trust encourages all of the Trustees to attend the Annual Meeting, and expects that all Trustees will attend the Annual Meeting absent a valid reason such as a scheduling conflict. All of the Trustees attended the Annual Meeting of Shareholders held on April 3, 2014.7, 2016.

Committees of the Board of Trustees

The Board of Trustees has four standing committees: the Executive Committee, the Nominating Committee, the Compensation Committee, and the Audit Committee.

Executive Committee

The Executive Committee of the Board of Trustees is authorized to make policy and certain business decisions during any interval between meetings of the Board of Trustees. All decisions of the Executive Committee are promptly reported to the Board of Trustees. During fiscal 2014,2016, the members of the Executive Committee were, and currently are, Robert S. Hekemian, Donald W. Barney, Herbert C. Klein, Ronald J. Artinian and Alan L. Aufzien.RobertAufzien. Robert S. Hekemian is the Chairman of the Executive Committee. The Executive Committee did not meet during fiscal 2014.2016.

Nominating Committee

The Nominating Committee is authorized to identify, evaluate and recommend to the Board of Trustees prospective nominees for Trustee, periodically review the Trust’s governance guidelines and make recommendations to the Board of Trustees from time to time as to matters of governance. The Nominating Committee also periodically reviews the performance of the Board of Trustees and its members and makes recommendations to the Board of Trustees on the number, function, and composition of the Board of Trustees and the committees of the Board of Trustees, and on the terms of the Trustees. The Nominating Committee’s charter is available on the Trust’s website atwww.freitnj.com under the “About FREIT” and “Corporate Governance” tabs.

The Nominating Committee reviews the qualifications of various persons to determine whether they might make good candidates for consideration for membership on the Board of Trustees, without a particular focus on diversity. The Nominating Committee considers the nominee’s business judgment, skill and experience, the nominee’s understanding of the Trust’s business and industry and other related industries, the nominee’s integrity, reputation and independence, and such other factors as the Nominating Committee determines are relevant in light of the needs of the Board of Trustees and the Trust and its Shareholders. With respect to any nominee uppeson nominated for re-election to the Board of Trustees, the Nominating Committee is authorized to consider the nominee’s performance on the Board of Trustees before nominating the Trustee for re-election at an annual meeting. The Trust does not pay a fee to any third party to identify or assist in identifying or evaluating potential nominees.

The Nominating Committee will also consider candidates for Trustee recommended by the Shareholders. The process by which a Shareholder may suggest a candidate to be nominated for election to the Board of Trustees can be found in the section of this Proxy Statement entitled “Shareholder Proposals and Recommendations for Nomination of Trustees.” The Nominating Committee will apply the same criteria described above to review and evaluate the qualifications of any candidate recommended by a Shareholder. However, the Nominating Committee has sole discretion whether to recommend any nominee for Trustee submitted by a Shareholder to the Board of Trustees.

The current members of the Nominating Committee of the Board of Trustees are Robert S. Hekemian,Donald W. Barney, Alan L. Aufzien and Ronald J. Artinian. Although Mr. Aufzien and Mr. Artinian meet the requirements for independence set forth in the definition of “independent director” in the listing rules of the NASDAQ Stock Market (the “NASDAQ Listing Rules”), Mr. HekemianBarney is not considered independent under the definition of “independent director” in the NASDAQ Listing Rules because he is an Executive Officer of the Trust. The Nominating Committee approved a recommendationrecommendations to the Board of Trustees that each of Donald W. BarneyRobert S. Hekemian, David F. McBride and Herbert C. KleinRobert S. Hekemian, Jr. be nominated for re-election as Trustees at the Annual Meeting, each to a three-year term.terms. The Board of Trustees subsequently approved such nominees. The Nominating Committee held two meetings and acted by unanimous written consent on one meetingoccasion during fiscal 2014.2016.

Compensation Committee

The Compensation Committee is charged with the responsibility of defining the Trust’s compensation philosophy and objectives, reviewing the compensation of the Executive Officers and Trustees, and making recommendations to the full Board of Trustees established a Compensation Committee of the Board in fiscal 2010.with respect to such compensation matters. The Compensation Committee is governed by a written charter, which is available on the Trust’s website atwww.freitnj.com under the “About FREIT” and “Corporate Governance” tabs.Thetabs. The current members of the Compensation Committee of the Board of Trustees are David F. McBride, Ronald J. Artinian and Alan L. Aufzien. Mr. McBride serves as the Chairman of the Compensation Committee. Each of the members of the Compensation Committee satisfies the qualifications for independence under the NASDAQ Listing Rules.

The Compensation Committee is charged with the responsibility of defining the Trust’s compensation philosophy and objectives, reviewing the compensation of the Executive Officers and Trustees, and making recommendations to the full Board of Trustees with respect to such compensation matters. The Compensation Committee’s processes and procedures for the foregoing reviews and analyses of the compensation of the Trust’s Executive Officers are discussed under “Executive Compensation” below. The compensation of the Trustees is discussed under “Trustee Compensation” below. The Compensation Committee held four meetingsone meeting during fiscal 2014.2016.

Audit Committee

The current members of the Audit Committee of the Board of Trustees are Ronald J. Artinian, Alan L. Aufzien and Herbert C. Klein. Mr. Artinian isserves as the Chairman of the Audit Committee. Each of Mr. Artinian and Mr. Aufzienmember of the Audit Committee satisfies the audit committee qualifications under the NASDAQ Listing Rules and is independent, as independence for audit committee members is defined in the NASDAQ Listing Rules. Mr. ArtinianRules, and Mr. Aufzien alsothey each meet the independence requirements of Exchange Act Rule 10A-3(b)(1). Although Mr. Klein meets the requirements for independence set forth in the definition of “independent director” in the NASDAQ Listing Rules, he does not meet the criteria for independence set forth in Exchange Act Rule 10A-3(b)(1) because the law firm of Nowell, Amoroso, Klein, Bierman, P.A., in which Mr. Klein is currently a partner, has received and will continue to receive legal fees from the Trust for legal services provided and to be provided to the Trust. See the section of this Proxy Statement entitled “Certain Relationships and Related Party Transactions.” Mr. Klein therefore does not satisfy the independence requirement for qualification as an audit committee member under the NASDAQ Listing Rules because the independence standards for audit committee members under the NASDAQ Listing Rules require that a director meet the independence requirements of Rule 10A-3(b)(1). The Board of Trustees has appointed Mr. Klein to the Audit Committee because the Board of Trustees believes that his background and experience and the valuable contributions that he makes to the Audit Committee sufficiently mitigate any concerns arising out of the fact that he does not satisfy the independence requirement of the audit committee qualifications under the NASDAQ Listing Rules.

The Audit Committee held four meetings during fiscal 2014.2016. The Audit Committee selects the independent registered public accounting firm (the “Independent Auditors”) to audit the books and accounts of the Trust. In addition, the Audit Committee reviews and pre-approves the scope and costs of all services (including non-audit services) provided by the Independent Auditors. The Audit Committee also monitors the effectiveness of the audit effort and financial reporting and inquires into the adequacy of the Trust’s financial and operating controls.

Based on its review of the criteria of an Audit Committee Financial Expert under the rules of the Securities and Exchange Commission (the “SEC”), the Board of Trustees believesdoes not believe that any of the members of the Trust’s Audit Committee may not qualifyqualifies as an Audit Committee Financial Experts.Expert.

Each of Mr.Ronald J. Artinian, Mr.Alan L. Aufzien and Mr.Herbert C. Klein has made significant contributions and provided valuable service to the Trust and its Shareholders as members of the Audit Committee. The Board of Trustees believes that each of Mr. Artinian, Mr. Aufzien and Mr. Klein has demonstrated that he is capable of (i) understanding accounting principles generally accepted in the United States of America (“GAAP”), (ii) assessing the general application of GAAP principles in connection with the accounting for estimates, accruals and reserves, (iii) understanding financial statements and analyzing and evaluating the Trust’s financial statements, (iv) understanding internal controls and procedures for financial reporting, and (v) understanding audit committee functions, all of which are attributes of an Audit Committee Financial Expert under the rules of the SEC. Given the business experience and acumen of Mr. Artinian, Mr. Aufzien and Mr. Klein and their long standing service as members of the Board of Trustees and its various committees, including the Trust’s Audit Committee, the Board of Trustees believes that each of Mr. Artinian, Mr. Aufzien and Mr. Klein is qualified to carry out all duties and responsibilities of the Trust’s Audit Committee.

The Board of Trustees believes that one of its members, Donald W. Barney, would qualify as an Audit Committee Financial Expert. Mr. Barney previously resigned from the Audit Committee in connection with his appointment to the office of Treasurer of the Trust and his assumption of the role of Chief Financial Officer of the Trust. As Chief Financial Officer of the Trust, Mr. Barney has made and will continue to make the certifications required under the Sarbanes-Oxley Act of 2002 and the related rules adopted by the SEC with respect to (i) the Trust’s financial statements and other financial information included in periodic reports filed with the SEC, (ii) the Trust’s disclosure controls and procedures regarding the disclosure to the certifying officers of material information relating to the Trust, and (iii) the Trust’s internal controls and the adequacy of the design and operation of such internal controls. As a certifying officer of the Trust, Mr. Barney meets with and makes reports to the Audit Committee with respect to the items which are the subject matter of his certifications. The Board of Trustees believes that it is important to maintain independence between the Audit Committee and the

certifying officers of the Trust, and that the significance and importance of maintaining such an independent relationship outweigh the importance of having a person who technically satisfies the definition of an Audit Committee Financial Expert serve on the Audit Committee.

At this time, the Board of Trustees does not believe that it is necessary to actively search for an outside person to serve on the Board of Trustees who would qualify as an Audit Committee Financial Expert.

Audit Committee Report

The following Report of the Audit Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Trust filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent the Trust specifically incorporates this Report by reference therein.

The Audit Committee meets each quarter during the fiscal year with the Trust’s Independent Auditors and members of Hekemian & Co. and focuses on the following areas:

The Audit Committee meets separately with Hekemian & Co. and the Trust’s Independent Auditors. The Independent Auditors have unrestricted access to the Audit Committee. The Independent Auditors make a quarterly report directly to the Audit Committee out of the presence of Hekemian & Co. concerning their functions as the Trust’s Independent Auditors.

The Board of Trustees has adopted a written charter setting out the audit related functions. The Audit Committee’s charter is available on the Trust’s website atwww.freitnj.com under the “About FREIT” and “Corporate Governance” tabs. The Audit Committee reviews its charter on an annual basis and updates the charter as necessary.

Hekemian & Co. has primary responsibility for the Trust’s financial statements and the preparation of all financial statements and the maintenance of the Trust’s internal controls.

The Independent Auditors audit the annual financial statements prepared by Hekemian & Co., express an opinion as to whether those financial statements fairly present the financial position, results of operations and cash flows of the Trust in conformity with GAAP and discuss with the Audit Committee any issues they believe should be raised.

For fiscal 2014,2016, the Audit Committee reviewed the Trust’s audited financial statements and met with both Hekemian & Co. and EisnerAmper LLP, the Trust’s Independent AuditorsRegistered

Public Accounting Firm for the 20142016 fiscal year, to review and discuss all financial statements and their respective assessments of the effectiveness of the Trust’s internal control over financial reporting. Hekemian & Co. has represented to the Audit Committee that the financial statements were prepared in conformity with GAAP.

The Audit Committee has received from and discussed with EisnerAmper LLP the written disclosure and the letter required by Independence StandardsPublic Company Accounting Oversight Board Standard No. 1(“PCAOB”) Rule 3526 (Independence Discussion with Audit Committees). These items relate to that firm’s independence from the Trust. The Audit Committee also discussed with EisnerAmper LLP any matters required to be discussed by the statement on Auditing Standards No. 61,16, as amended (Communication with Audit Committees), as adopted by the Public Company Accounting Oversight BoardPCAOB in Rule 3200T.

On the basis of these reviews and discussions, the Audit Committee recommended to the Board of Trustees that the Trust’s audited financial statements be included in the Trust’s Annual Report on Form 10-K for the fiscal year ended October 31, 2014,2016, for filing with the SEC.

Corporate Governance

Code of Ethics

The Trust has adopted a Code of Ethics that is applicable to all Trustees, officers and management employees of the Trust, including, without limitation, the Trust’s principal executive and senior financial officers. The Audit Committee is charged with administering and interpreting the Code of Ethics. The Code of Ethics is available on the Trust’s website atwww.freitnj.com under the “About FREIT” and “Corporate Governance” tabs.

Board Leadership Structure

The Board of Trustees does not have a fixed policy regarding the separation of the positions of Chairman of the Board and Chief Executive Officer; rather, the Board favors the flexibility to select the Chairman and to determine the optimal Board leadership structure from time to time in the best interests of the Trust and its Shareholders.  

At this time, the Board of Trustees believes that the Trust and its Shareholders are best served by having the same individual, Robert S. Hekemian, serve as both Chairman of the Board and Chief Executive Officer. The Board of Trustees believes that the centralization of leadership through the combination of these two roles in a single individual promotes the development and implementation of corporate strategy and the advancement of the Trust’s goals. The combination of the Chairman and Chief Executive Officer positions in a single individual is the optimal structure for the Chief Executive Officer to efficiently and effectively execute his duties and fulfill his responsibilities as the principal executive officer of the Trust, to keep the Board informed about matters affecting the Trust and to facilitate communication between management and the Board. In addition, this unity of leadership eliminates the potential for confusion or duplication of efforts, and provides for clear leadership and accountability and effective

decision-making for the Trust. The Board of Trustees does not have a “lead” independent director.

Risk Oversight

The full Board of Trustees is responsible for actively overseeing the Trust’s risk profile and management’s processes for assessing and managing risk through regular meetings of the Board, as well as informal communications with management.  The Chairman and Chief Executive Officer, other senior management members and employees of Hekemian & Co., the Trust’s managing agent, regularly report to the Board on significant risks affecting the Trust, including financial, operational and strategic risks.  The full Board (or the appropriate committee of the Board, in the case of risks that are under the purview of a particular committee) receives these reports from management to enable the Board (or committee, as the case may be) to understand the Trust’s risk identification, risk management and risk mitigation strategies.

In addition, while the full Board of Trustees has the ultimate oversight responsibility for the risk oversight process, various committees of the Board comprised of independent directors also have responsibility for risk oversight.  The Audit Committee of the Board of Trustees (i) reviews and assesses risk relative to insurance coverage for the Trust’s operating activity and financial investments, including the investment of liquid assets; (ii) evaluates the impact, if any, of changes in interest rates and energy prices and oversees actions taken to mitigate risk associated with fluctuations in interest rates and energy prices; (iii) conducts internal control reviews and reports any material issues raised in the course of such reviews; and (iv) reviews internal controls on financial reporting with the Independent Auditors. The Audit Committee presents reports to the full Board of Trustees on a quarterly basis and reports any matters relative to risk oversight that require the attention or action of the full Board. The Compensation Committee oversees the Trust’s compensation programs to ensure that they do not create incentives that expose the Trust to unnecessary and excessive risks.  

When a report from management is vetted at the committee level, the chairperson of that committee subsequently reports on the matter to the full Board of Trustees, which enables the Board and the committees to coordinate the Board’s risk oversight role.

EXECUTIVE COMPENSATION

The Trust is externally managed by Hekemian & Co., a real estate management company established in 1933. Hekemian & Co. is owned by members of the family of Robert S. Hekemian, Chairman and Chief Executive Officer of the Trust, and Robert S. Hekemian, Jr., a Trustee of the Trust. As compensation for its management services, the Trust pays Hekemian & Co. management and other fees pursuant to a Management Agreement.Agreement between the Trust and Hekemian & Co. In addition, as an incentive to the employees of Hekemian & Co. (including members of the Hekemian family) to identify and provide real estate investment opportunities for the Trust, the Trust has advanced to such employees who are investors in certain joint venture projects a portion of the equity capital required to be contributed by them to such joint ventures. The Management Agreement and these other incentives are more particularly described in “Certain Relationships and Related Party Transactions; Director Independence” below.

In view of the Trust’s external management structure, the Trust does not employ Executive Officers on a full-time basis. The following Compensation Discussion and Analysis presents information regarding the Trust’s compensation policies and programs and the compensation of the Trust’s Executive Officers.

Compensation Discussion and Analysis

Overview

The Trust’s compensation program is designed to properly compensate the Executive Officers commensurate with the duties and services that they are employed to perform for the Trust, to reward their dedication, hard work and success and align their interests with the long-term interests of the Trust. The Compensation Committee reviews the compensation paid to the Executive Officers in consideration of these objectives and makes recommendations to the Board of Trustees regarding its determinations. The various factors considered by the Compensation Committee in reaching its determinations concerning the compensation of the Executive Officers are discussed under “Fiscal 20142016 Compensation” below.

Recovery of Erroneously Awarded Compensation

The Board of Trustees has adopted a policy that provides that, in the event that the Trust is required to prepare an accounting restatement due to the Trust’s material noncompliance with any financial reporting requirement, the Trust will require the reimbursement, cancellation or forfeiture, as the case may be and to the fullest extent permitted by applicable law, of any incentive-based compensation paid to any current or former Executive Officer during the three-year period preceding such restatement that was based on the erroneous data and that was paid in excess of the compensation that would have been paid to the Executive Officer based on the accounting restatement. The Trust will disclose any incentive-based compensation paid to any Executive Officer that is based on any measure of financial performance or any other financial information in the Trust’s proxy statement for the annual meeting of Shareholders and as required by the rules and regulations of the SEC.

As discussed under “Elements of Executive Compensation” below, the Trust did not pay any incentive-based compensation to any of the Executive Officers during fiscal 2014.2016.

Hedging Policy

It is the policy of the Trust that no employee or Trustee of the Trust may purchase any financial instruments that are designed to hedge or offset any decrease in the market value of the Trust’s Shares that (i) were previously awarded, or acquired pursuant to the exercise of any option granted, to an employee or Trustee by the Trust as part of the compensation of such employee or Trustee or (ii) otherwise held, directly or indirectly, by an employee or Trustee, which financial instruments shall include, without limitation, puts, calls, straddles, equity swaps and any other derivative security that is directly linked to the Shares.

Elements of Executive Compensation

There are three elements to the compensation of the Executive Officers of the Trust: (1) base salary; (2) the Equity Incentive Plan; and (3) the Amended and Restated Deferred Fee Plan (the “Deferred Fee Plan”). The Compensation Committee and the Board of Trustees believe that these elements allow the Trust to accomplish its objectives of properly compensating the Executive Officers for their services to the Trust, rewarding the dedication, hard work and success of Executive Officers and aligning the interests of Executive Officers with the long-term interests of the Trust.

Except for base salary, benefits under the Equity Incentive Plan and Deferred Fee Plan, and fees paid to certain of the Executive Officers for their service as Trustees, the Trust does not pay any other compensation or benefits to its Executive Officers, whether it be in the form of bonus, long-term incentive compensation, perquisites, rights, warrants, convertible securities, performance units, performance shares or other similar instruments. The Equity Incentive Plan and the Deferred Fee Plan are the only employee benefit plans maintained by the Trust. There are no employment contracts between the Trust and any of the Executive Officers, nor is there any compensatory plan or arrangement between the Trust and any of the Executive Officers pursuant to which an Executive Officer would receive payments as the result of his resignation or retirement as an Executive Officer, or any other event resulting in the termination of his relationship with the Trust as an Executive Officer, or as a result of a change in control of the Trust. The Trust’s Deferred Fee Plan, discussed below, provides that a participant may receive Shares with respect to amounts credited to such participant’s account under the Deferred Fee Plan, including amounts deferred thereunder and accrued interest, upon such participant’s attainment of the retirement age specified in the participant’s deferral election, such participant’s actual retirement, upon such participant’s cessation of services prior to retirement, or upon the occurrence of a change in control of the Trust as defined under the Deferred Fee Plan. The Trust’s Equity Incentive Plan provides that in the event of (i) a “change in control,” as such term is defined in the Equity Incentive Plan, or (ii) a sale of all or substantially all of the assets of the Trust, other than a sale of assets to a subsidiary or other affiliated entity of the Trust, all outstanding options granted under the Equity Incentive Plan shall become exercisable (to the extent not already exercisable) immediately before or contemporaneously with the occurrence of such change in control or sale, and each outstanding restricted share award granted under the Equity Incentive Plan shall immediately become free of all restrictions, conditions and forfeiture provisions. As of October 31, 2014,2016, there were 192,000178,800 unexercised options collectively held by the Executive Officers and Trustees of the Trust that were outstanding. Additional information with respect to outstanding stock options is set forth in the “Outstanding Equity Awards at Fiscal Year-End” table below.

Mr. Robert S. Hekemian, Chairman of the Board and Chief Executive Officer of the Trust, is Chairman of the Board and Chief Executive Officer of Hekemian & Co., the managing agent of the Trust. Mr. Robert S. Hekemian, Jr., a Trustee of the Trust, is the President and Chief Operating Officer of Hekemian & Co. Pursuant to the terms of the Management Agreement between Hekemian & Co. and the Trust, Hekemian & Co. is entitled to receive a termination fee from the Trust under certain circumstances, including the non-renewal of the Management Agreement by the Trust, termination of the Management Agreement by the Trust without cause, or termination of the Management Agreement by the Trust following an acquisition of the Trust. See “Certain Relationships, Related Party Transactions; Director Independence” below.

Equity Incentive Plan

The Board of Trustees approved the Equity Incentive Plan on September 10, 1998, subject to approval by the Trust’s Shareholders. The Shareholders of the Trust approved the Equity Incentive Plan at the Annual Meeting of Shareholders held on April 7, 1999, and the Equity Incentive Plan became effective as of that date. On February 15, 2007, the Board of Trustees approved, subject to Shareholder approval, (i) an amendment to the Equity Incentive Plan to increase the number of Shares of the Trust reserved for issuance thereunder by 300,000 Shares and (ii) an amendment to the Equity Incentive Plan to extend the term of the Equity Incentive Plan, which would have expired on September 10, 2008, until September 10, 2018. The Shareholders approved such amendments at the Annual Meeting of Shareholders held on April 4, 2007.

The purpose of the Equity Incentive Plan is to allow the Trust to retain the services of individuals, including, but not limited to, Executive Officers, who have made, and/or who are expected to make, significant contributions to the business of the Trust and its subsidiaries, to align such persons’ interests with the long-term interests of the Trust, and to reward hard work, dedication and success by providing such individuals with an opportunity to acquire Shares of the Trust or receive other stock-based awards.

The Board of TrusteesadministersTrustees administers the Equity Incentive Plan and, based on recommendations made by the Compensation Committee, may grant options, restricted share awards, and other share basedequity-based awards under the Equity Incentive Plan to eligible participants. Upon the recommendation of theThe Compensation Committee did not recommend, and the Board granted an aggregate of 192,000Trustees did not make, any grants of stock options or other equity-based awards under the Equity Incentive Plan during the 2016 fiscal year. However, inasmuch as Justin F. Meng and John A. Aiello had not yet been appointed to the Board at the time that the Board had last approved grants of stock options to the Executive OfficersTrustees in September 2014 and Trustees of the Trust (including 4,000therefore had not been granted stock options issued to Robert S. Hekemian, Jr. in his capacity as President and Chief Operating Officer of Hekemian & Co.) on September 4, 2014, all of which were unexercised and outstanding as of October 31, 2014. Additional information with respect to these stock option grants is set forth inat that time, the “Grants of Plan-Based Awards,” “Outstanding Equity Awards at Fiscal Year-End” and “Fiscal 2014 Trustee Compensation” tables below. Further discussion of the stock option grantsCompensation Committee recommended to the Executive Officers in the 2014 fiscal year is set forthBoard of Trustees that Justin F. Meng and John A. Aiello each be granted options to acquire 19,000 Shares under the caption “Fiscal 2014 Compensation” below.Equity Incentive Plan in November 2016, and the Board approved the Compensation Committee’s recommendation.

Amended and Restated Deferred Fee Plan

Effective November 1, 2000, the Board of Trustees adopted the Deferred Fee Plan, which is intended to provide a benefit to Executive Officers and Trustees who have made, andand/or who are expected to continue to make, significant contributions to the long-term success of the Trust by providing such individuals with a long-term savings opportunity.Trust. An election to defer compensation is required to be made prior to the calendar year for which it will be effective, and is irrevocable with respect to the calendar year to which it applies.  The

Deferred Fee Plan was amended and restated effective December 31, 2008, and further amended and restated effective November 1, 2014.  

The original purpose of the Deferred Fee Plan was to provide Executive Officers and Trustees with a long-term savings opportunity. Prior to the amendments to the Deferred Fee Plan that went into effect as of November 1, 2014, the Deferred Fee Plan permitted any Executive Officer or Trustee to elect to defer receipt of any compensation, including Executive Officer salary, Trustee annual retainer fees, meeting attendance fees, and property site inspection fees, and the rate of interest payable on any amounts deferred was fixed at 9% per annum, compounded quarterly, which interest rate was determined based on a rate equalquarterly.

The amendments to 120% of the applicable federal long-term interest rate in effect in November 2000, the month in which the Deferred Fee Plan was established.

Thethat went into effect as of November 1, 2014 shifted the purpose of the Deferred Fee Plan asfrom a long-term savings vehicle for eligible participants to an opportunity for eligible participants to increase their equity position in the Trust. As amended and restated effective November 1, 2014, the Deferred Fee Plan no longer permits Trustees who are also Executive Officers of the Trust to defer amounts payable to them as salary for their services as Executive Officers. Participants in the Deferred Fee Plan are only permitted to defer amounts payable to them for their service as Trustees. In addition, from and after November 1, 2014, amounts deferred, together with the interest accrued on a participant’s entire balance, shall be converted on the last day of each calendar quartermonth into share units (“Share Units”) that are equivalent to Shares (“Share Units”), and credited to the participant’s account. The number of Share Units to be credited will be determined by the closing price of the Shares on the date of the deferral. The participants’ existing balances as of October 31, 2014 shall be preserved in the form of cash and shall not be converted into Share Units, although the interest that accrues on thesuch existing balancebalances from and after November 1, 2014 will be converted into Share Units. TheAs of November 1, 2014, the interest rate on participants’ cash balances under the Deferred Fee Plan has beenwas changed as of November 1, 2014 from 9% per annum to the average interest rate on ten yearten-year Treasury bonds plus 150 basis points. In the event that any cash dividend is paid by the Trust with respect to the Shares, each participant will be credited with a number of Share Units equal to (x) the amount of the cash dividend paid with respect to one Share, (y) multiplied by the total number of Share Units credited to a participant’s account as of the record date for the dividend, (z) divided by the Fair Market Valuefair market value of one Share on the trading day immediately preceding the payment date of the dividend. In the event that any dividend is paid with respect to the Shares in Shares, each participant shall be credited with a number of Share Units equal to the number of full Shares that such participant would have received had the participant been the owner, on the record date for the dividend, of a number of Shares equal to the number of Share Units credited to the participant’s account.

A participant’s deferred benefits under the Deferred Fee Plan shall be paid to the participant at either: (i) the retirement age specified by the participant in the deferral election; (ii) actual retirement of the participant; (iii) upon the earlier cessation of duties as a Trustee of the Trust; or (iv) upon a change in control of the Trust, as defined in the Deferred Fee Plan.  On the payment date, the Trust shall issue to the participant a number of Shares equal to the number of Share Units credited to the participant’s account, and shall pay to the participant amounts maintained in the participant’s account as of October 31, 2014 as cash in either a lump sum or in a number of substantially equal annual installments over a period not to exceed 10 years, at the election of the participant, except if a participant elects to receive payment upon the occurrence of a change in control, in which case all such amounts shall be payable in a lump sum.  The Trust

has not created and will not create a cash sinking fund for amounts deferred pursuant to the Deferred Fee Plan that are not payable in Shares.  As a result, any participant who elects to participate in the Deferred Fee Plan is an unsecured creditor of the Trust with respect to any amounts deferred thereunder.  The Deferred Fee Plan may be amended, suspended or terminated by resolution of the Board of Trustees at any time and from time to time, provided that no amendment, suspension or termination shall operate to adversely affect the plan benefits accrued or available for any participant.  

As of October 31, 2014, approximately $5,163,000an aggregate amount of fees have$9,078,000 had been deferred together withunder the Deferred Fee Plan, which represented an aggregate of $5,224,000 of deferred fees and $3,854,000 of accrued deferred interest, of approximately $3,854,000. Thesewhich amounts shall be maintained as cash in the participants’ accounts under the Deferred Fee Plan and shall not be converted into Share Units as described aboveabove.

During the 2016 fiscal year, participants deferred a total of approximately $683,100 under the Deferred Fee Plan, consisting of approximately $390,100 of deferred fees and accrued deferred interest of approximately $293,000. Pursuant to the amendments to the Deferred Fee Plan that became effective on November 1, 2014, the aggregate amount of $683,100 deferred by all participants converted into an aggregate of 34,454 Share Units during fiscal 2016, which were credited to the participants’ accounts. In addition, the participants were credited with an aggregate of 3,740 Share Units during fiscal 2016 representing dividends paid with respect to the Share Units credited to their accounts. Additional information regarding the participants’ deferral of fees and the conversion of deferred amounts deferredinto Share Units credited to their accounts is set forth under “Fiscal 2016 Nonqualified Deferred Compensation” and accrued interest from and after October 31, 2014.“Fiscal 2016 Trustee Compensation” below.

Fiscal 2016 Compensation

In fiscal 2014, the Compensation Committee determined and recommended to the Board that for fiscal 2015, the base salary paid to Robert S. Hekemian for his service as the Chairman and Chief Executive Officer of the Trust be increased to $300,000 per year from $205,000 per year, and the base salary paid to Donald W. Barney for his service as Chief Financial Officer and Treasurer of the Trust be increased to $75,000 per year from $50,000 per year. The Board of Trustees approved the Compensation Committee’s recommendations with respect to the increases in the base salaries of Mr. Hekemian and Mr. Barney. The Compensation Committee did not make any recommendations to the Board regarding the compensation of the Executive Officers for fiscal 2016, and the Board did not take any action with respect to the compensation of the Executive Officers for fiscal 2016.

The Compensation Committee consideredconsiders the following factors, among other things, in the course of its review of the compensation for the Executive Officers, for the 2014 fiscal year, including with respect to both Robert S. Hekemian in his capacity as Chairman of the Board and Chief Executive Officer, and Donald W. Barney in his capacity as President, Treasurer and Chief Financial Officer: (i) compensation paid by other real estate investment trusts, both as a component of operating expenses and to ensure that the Trust’s compensation levels are competitive in the industry; (ii) the duties and responsibilities of the Executive Officers and the value of the services provided by them, including the amount of time expended by them on the Trust’s business; (iii) the Trust’s operating results and financial condition, as well as the condition and prospects of the residential and commercial real estate markets; and (iv) the results of the most recent shareholder advisory

vote to approve the compensation of the Executive Officers, which was conducted at the 2014 Annual Meeting.

The Compensation Committee reviews compensation paid by other real estate investment trusts in the most general way in view of the fact that unlike many other real estate investment trusts, the Trust is externally managed and the Trust’s Executive Officers do not spend full time in their respective positions.  Mr. Hekemian devotes approximately 70% of his business activities to the Trust, and, as a result of that commitment, the compensation paid to him is more than the amount paid to other executive officers of the Trust. Mr. Barney devotes approximately 15% of his business activities to the Trust, and Mr. Aiello devotes approximately 6%10% of his business activities to the Trust and the compensation paid to them reflects these circumstances. In addition, in determining compensation to be paid to Executive Officers, the Compensation Committee considers the size and scope of the Trust’s business and operations as reflected on its balance sheet and income statement in relationship to other real estate investment trusts.

AtAs required by the rules and regulations of the Securities and Exchange Commission, at the 2014 Annual Meeting of Shareholders, the Shareholders were asked to approve an advisory resolution approving the compensation of the Executive Officers as disclosed and described in the Compensation Discussion and Analysis, compensation tables and narratives contained in the Trust’s proxy statement used in connection with the 2014 Annual Meeting. The advisory resolution received the approval of approximately 95.6% of the votes cast on this proposal. The Compensation Committee and the Board of Trustees concluded from the strong approval of the advisory resolution that the Shareholders believe that the Trust’s compensation policies and the compensation paid to the Executive Officers are appropriate and reflective of the Trust’s objectives of aligning the interests of the Executive Officers with the long-term interests of the Trust. In accordance with the rules and regulations of the SEC, and based on the results of the vote by the Shareholders at the 2011 Annual Meeting on the frequency of such vote, the advisory vote by the Shareholders to approve the compensation of the Executive Officers will occur again at the 2017 Annual Meeting.

For the 2014 fiscal year, after taking into account the factors referenced in the preceding paragraphs, the The Compensation Committee determined, and recommendedwill consider the results of the vote to approve the Board, thatadvisory resolution approving the base salaries paid to the Trust’s Executive Officers in the 2013 fiscal year were appropriate and would remain the same for the 2014 fiscal year. In addition, the Compensation Committee recommended that stock options be granted tocompensation of the Executive Officers under the Equity Incentive Plan based on the financial performance of the Trust and in furtherance of the goal of the Equity Incentive Plan of keeping the interests of the Executive Officers and the long-term interests of the Trust aligned. The Committee also considered the fact that the Trust had last granted stock options to the Executive Officers under the Equity Incentive Plan in 1998. The Committee recommended that Robert S. Hekemian, the Chairman and Chief Executive Officer of the Trust, be granted options to acquire 48,000 Shares, and Donald W. Barney, the Chief Financial Officer and Treasurer of the Trust, be granted options to acquire 36,000 Shares, which included grants of stock options to Mr. Hekemian and Mr. Barney for their service as Trustees. The Committee recommended that the options have terms of ten (10) years from the date of grant, vest in equal installments over a period of five (5) years from the date of grant, and have exercise prices equal to the Fair Market Value (as such term is definedItem 2 in the Equity Incentive Plan)Committee’s review of, the Shares on the date of grant. The Board of Trustees approved the Compensation Committee’sand recommendations with respect to, the grant of stock options to Mr. HekemianExecutive Officers’ compensation for fiscal 2017 and Mr. Barney on September 4, 2014, which is the effective date of the grants.

Action on Fiscal 2015 Compensation

The Compensation Committee determined and recommended to the Board that the base salaries paid to the Trust’s Executive Officers be increased for the 2015 fiscal year. In addition to the factors described in the preceding paragraphs, the Committee’s recommendation was based in part on the fact that Executive Officer base salaries had not been adjusted since 2006, and the Committee’s interest in assuring that the compensation paid to Executive Officers of the Trust is competitive within the industry. The Compensation Committee recommended that the base salary paid to Robert S. Hekemian for his service as the Chairman and Chief Executive Officer of the Trust be increased to $300,000 per year from $205,000 per year, and the base salary paid to Donald W. Barney for his service as Chief Financial Officer and Treasurer of the Trust be increased to $75,000 per year from $50,000 per year. The Board of Trustees approved the Compensation Committee’s recommendations with respect to the increases in the base salaries of Mr. Hekemian and Mr. Barney.

In addition, as discussed under “Amended and Restated Deferred Fee Plan” above, the Board approved amendments to the Deferred Fee Plan that became effective November 1, 2014. The amendments included the following changes: (i) participants who are also Executive Officers are no longer permitted to defer amounts paid to them as salary for their service as Executive Officers; (ii) the annual interest rate on deferred amounts was reduced from 9% to a rate equal to the average interest rate on ten year Treasury bonds plus 150 basis points; and (iii) on a prospective basis, amounts deferred and accrued interest thereon shall be converted into Share Units that are equivalent to Shares. These amendments were driven by the Board’s determination to provide the Trustees, and the Executive Officers who also serve as Trustees, the opportunity to receive compensation in the form of Shares in lieu of cash, which would further the goal of the Trust’s executive compensation program of keeping the interests of the Executive Officers aligned with the long-term interests of the Trust.

future years.

Risk Management

The Compensation Committee does not believe that the Trust’s executive compensation program gives rise to any risks that are reasonably likely to have a material adverse effect on the Trust. Executive Officers are compensated on a fixed salary basis and have not been awarded any bonuses or other compensation that might encourage the taking of unnecessary or excessive risks that threaten the long-term value of the Trust. In addition, the Compensation Committee and the Board of Trustees have utilized, and expect to continue to utilize, the Equity Incentive Plan to align the interests of the Trustees and Executive Officers with the long-term interests of the Trust and the Shareholders through grants of stock options and other equity-based awards, thereby giving the Trustees and Executive Officers additional incentives to protect the long-term value of the Trust. As described in further detail elsewhere herein, the Board of Trustees most recently approved grants of stock options under the Equity Incentive Plan to the Executive Officers and Trustees on September 4, 2014, upon the recommendation of the Compensation Committee.

Executive Compensation and Financial Performance

As discussed above, the Executive Officers of the Trust are compensated primarily on a fixed salary basis and have not been awarded any incentive-based cash bonuses, and the compensation paid to the Executive Officers is not specifically dependent upon any particular measure of financial performance. However, the Compensation Committee considers, in general terms, both the overall financial performance and condition of the Trust and the Trust’s long-term prospects in the Committee’s determination of appropriate levels of executive salary, among other factors and considerations discussed under “Fiscal 20142016 Compensation” above.

As described above, the Board of Trustees approved grants of stock options under the Equity Incentive Plan to the Trust’s Chairman and Chief Executive Officer and the Chief Financial Officer and Treasurer. The stock option grants were not based on any specific performance measure or benchmark. Rather, the Compensation Committee determined that the Trust’s overall financial performance warranted the grants of stock options to these Executive Officers for the 2014 fiscal year. The Committee also considered the fact that the Trust had not made any stock option grants to the Executive Officers under the Equity Incentive Plan since 1998.

Chief Executive Officer Compensation and Employee Compensation

The table below sets forth comparative information regarding (A) the total compensation of the Chief Executive Officer for the 20142016 fiscal year, (B) the median of the total compensation of all of the other full-time employees of the Trust, not including the Chief Executive Officer, for the 20142016 fiscal year, and (C) the ratio of the Chief Executive Officer’s total compensation to the median of the total compensation of all other full-time employees (other than the Chief Executive Officer). TheAs of October 31, 2016, the Trust had 2642 employees, including 30 full-time employees, which does10 part-time and seasonal employees and 2 Executive Officers of the Trust but not includeincluding the Chief Executive Officer, as of October 31, 2014.Officer.

Compensation Committee Interlocks and Insider Participation

For the fiscal year ended October 31, 2014,2016, David F. McBride, Ronald J. Artinian and Alan L. Aufzien served on the Compensation Committee of the Board of Trustees, with Mr. McBride serving as the Chairman of the Committee. None of the members of the Compensation Committee served as an executive officer or employee of the Trust at any time during the 20142016 fiscal year, nor have any of them ever served as an executive officer of the Trust in any prior year.

Compensation Committee Report

The Compensation Committee has discussed and reviewed the foregoing Compensation Discussion and Analysis with management. Based upon this review and discussion, the Compensation Committee recommended to the Board of Trustees that the Compensation Discussion and Analysis be included in this Proxy Statement.

SUMMARY COMPENSATION TABLE

The following table sets forth information concerning the compensation of all of the named executive officers of the Trust (the “Executive Officers”) as of October 31, 2014,2016, October 31, 20132015 and October 31, 20122014 for services in all capacities to the Trust for the 2014, 20132016, 2015 and 20122014 fiscal years, respectively. During the fiscal year ended October 31, 2014,2016, Robert S. Hekemian served as Chairman of the Board and Chief Executive Officer of the Trust, during which time Mr. Hekemian devoted approximately 70% of his business activities to the Trust. During the fiscal year ended October 31, 2014,Trust; Donald W. Barney served as President, Treasurer and Chief Financial Officer of the Trust, during which time Mr. Barney devoted approximately 15% of his business activities to the Trust. During the fiscal year ended October 31, 2014,Trust; and John A. Aiello, Esq. served as the Secretary and the Executive Secretary of the Trust, during which time Mr. Aiello devoted approximately 6%10% of his business activities to the Trust. With respect to all compensation, the term “paid” shall mean actually paid or deferred.

The following table sets forth information concerning the compensation of the Executive Officers that was deferred pursuant to the Deferred Fee Plan, described under “Amended and Restated Deferred Fee Plan” above, for the fiscal year ended October 31, 2014:2016:

FISCAL 20142016 NONQUALIFIED DEFERRED COMPENSATION

The following table sets forth information concerning the conversion into Share Units of deferred fees, accrued deferred interest and dividends payable with respect to credited Share Units under the Deferred Fee Plan during fiscal 2016, and the aggregate number of credited Share Units, for each Executive Officer individually.

See “Amended and Restated Deferred Fee Plan” above for more information concerning the terms and provisions of the Deferred Fee Plan and the information set forth in these tables.

Securities Authorized for Issuance under Equity Compensation Plans

The number of stock options outstanding under the Equity Incentive Plan, the weighted-average exercise price of the outstanding options, and the number of securities remaining available for issuance, as of October 31, 20142016 were as follows:

EQUITY COMPENSATION PLAN TABLE

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

Fiscal 20142016 Option Exercises and Stock Vested

There were no exercises of stock options or vesting of stock held by Executive Officers in the fiscal year ended October 31, 2014.2016.

TRUSTEEITEM 2 – ADVISORY RESOLUTION TO APPROVE EXECUTIVE COMPENSATION

During the fiscal year ended October 31, 2014, each Trustee, including every such Trustee who also served as an Executive OfficerSection 14A of the Trust, was entitled to receiveExchange Act and the rules and regulations promulgated thereunder provide that, not less frequently than once every three years, an annual retainer feeissuer shall include in the amount of $15,000. The Trustees were also entitled to receive meeting attendance fees in the amount of $800its proxy statement for eachits annual meeting of shareholders an advisory resolution subject to a shareholder vote to approve the compensation of the Trust’s Executive Officers.  The Trust last included such an advisory resolution in its proxy statement in connection with the Trust’s 2014 Annual Meeting. At the 2017 Annual Meeting, you are asked to approve the compensation of the Trust’s Executive Officers as described under the heading “Compensation Discussion and Analysis,” the compensation tables and the related narrative discussion, by voting in favor of the following advisory resolution:

“RESOLVED, that the shareholders of First Real Estate Investment Trust of New Jersey approve the compensation of the Executive Officers as discussed and disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion.”

Under the rules and regulations of the Securities and Exchange Commission, your vote is advisory and will not be binding upon the Trust or the Board of Trustees and will not be construed to overrule any decision by the Trust or the Board or require the Board to take any action.  However, the Compensation Committee and the Board of Trustees will take the results of this advisory vote into consideration when considering future compensation arrangements for the Executive Officers and whether any adjustments or modifications are warranted.

As discussed in this Proxy Statement, the Compensation Committee and the Board of Trustees believe that the Trust’s compensation programs and the actual compensation paid to the Executive Officers are supportive of the long-term interests of the Trust and the creation of value for the Trust’s Shareholders. Accordingly, the Board of Trustees unanimously recommends a voteFOR the approval of the advisory resolution approving the compensation of the Executive Officers, as described in this Proxy Statement.

The affirmative vote of a majority of the votes cast at the Annual Meeting will approve this advisory resolution.

ITEM 3 – ADVISORY RESOLUTION TO DETERMINE FREQUENCY OF VOTE ON AN ADVISORY RESOLUTION TO APPROVE EXECUTIVE COMPENSATION

Section 14A of the Exchange Act and the rules and regulations promulgated thereunder provide that, not less frequently than once every six years, an issuer shall include in its committees attendedproxy statement for its annual meeting of shareholders an advisory resolution subject to a shareholder vote to determine whether a vote to approve an advisory resolution approving executive compensation, as set forth in Item 2 above, will occur every year, every two years or every three years. The Trust last included such an advisory resolution in its proxy statement in connection with the 2011 Annual Meeting of Shareholders, which was the first time the Trust was required to include this advisory resolution in its proxy statement. At the 2011 Annual Meeting of Shareholders, the Trust’s Shareholders approved a three-year interval.

At the 2017 Annual Meeting, you are asked to vote on the resolution below to determine whether the vote to approve an advisory resolution approving the compensation of the Executive Officers of the Trust will be held every year, every two years or every three years.

“RESOLVED, that the advisory vote required by Section 14A(a)(1) of the Securities Exchange Act of 1934, as amended, to approve the compensation of the Executive Officers of First Real Estate Investment Trust of New Jersey shall occur(i) every year; (ii) every two years; or (iii) every three years [specific interval to be determined based on results of shareholder voting] at the annual meeting of shareholders of First Real Estate Investment Trust of New Jersey, from and $400after the 2017 Annual Meeting of Shareholders.”

Under the rules and regulations of the Securities and Exchange Commission, your vote is advisory and will not be binding upon the Trust or the Board of Trustees and will not be construed to overrule any decision by the Trust or the Board or require the Board to take any action.  However, the Trust and the Board of Trustees will take the outcome of this advisory vote into account when considering the frequency of the advisory vote to approve the compensation of the Executive Officers.

The Board of Trustees believes that the goals of the Trust’s executive compensation programs of supporting the long-term interests of the Trust and long-term value creation for its Shareholders are best served by an advisory vote to approve the compensation of the Executive Officers in three-year intervals. The Board is concerned that this long-term focus could be compromised and undermined by holding such vote with any greater frequency by shifting the focus of executive compensation to short-term performance measures. In addition, the Board believes that three-year intervals will afford the Compensation Committee sufficient time to assess the Shareholders’ views on the Trust’s compensation programs and to effectively deliberate and implement appropriate responses. The three-year time frame will also give Shareholders the best opportunity to evaluate the effectiveness of the Trust’s compensation programs in view of the Trust’s long-term goals.

Accordingly, the Board of Trustees unanimously recommends a vote forTHREE YEARS in favor of holding the vote to approve an advisory resolution approving the compensation of the Executive Officers every three years.

The interval that receives a plurality of the votes cast at the Annual Meeting will be approved.

TRUSTEE COMPENSATION

For the 2016 fiscal year, each Trustee was entitled to receive (i) an annual retainer fee of $35,000 per year (which annual retainer fee was pro rated for those Trustees who were appointed as Trustees in the middle of fiscal 2016); (ii) a per meeting participated in by teleconference.attendance fee of $1,500 per meeting of the Board and each committee of which a Trustee is a member; (iii) a per meeting fee for telephonic meetings of $1,000 per meeting of the Board and each committee; and (iv) a site inspection fee of $1,000 per site inspection. The Chairman of the Board for each Boardwas entitled to receive a per meeting attendance fee of Trustees$1,800 per meeting attended, and the chairman of each committee of the Board, and the Chairman of Trustees, for each committee meeting attended,the Audit Committee and the Chairman of the Compensation Committee were entitled to receive per meeting attendance fees of $1,100. In addition,$1,800 per meeting of the Audit Committee and Compensation Committee, respectively. The Chairman of the Audit Committee was entitled to receive an additional annual retainer fee inof $10,000, and the amountChairman of $10,000. The Trustees were alsothe Compensation Committee was entitled to receive property site inspection fees in the amountan additional annual retainer fee of $800 for each site inspection attended, plus the reimbursement of all reasonable and verified out-of-pocket expenses incurred in connection with the site visit. $7,500.

The Trustees are entitled to defer all or any part of their retainer, meeting and property site inspection fees pursuant to the terms of the Deferred Fee Plan. See “Amended and Restated Deferred Fee Plan.” For the fiscal year ended October 31, 2014,2016, Trustees (including the Trustees who were paid oralso Executive Officers during fiscal 2016) elected to defer an aggregate amount of approximately $683,100 of annual retainer fees, meeting attendance fees, site inspection fees and accrued interest inpayable to them for their services to the Board of Trustees and its committees, which amount was converted into an aggregate amount of $1,204,719as consideration34,454 Share Units during fiscal 2016. In addition, the Trustees (including the Trustees who were also Executive Officers during fiscal 2016) were credited with an aggregate of 3,740 Share Units during fiscal 2016 from the conversion of dividends paid with respect to the Share Units credited to their accounts. See “Amended and Restated Deferred Fee Plan” under “Executive Compensation” above. For the fiscal year ended October 31, 2016, the Trust paid an aggregate of $75,000 of annual retainer fees, meeting attendance fees and site inspection fees to the Trustees in cash for their services to the Board of Trustees and its committees.