Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2018 | May 01, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | MONMOUTH REAL ESTATE INVESTMENT CORP | |
Entity Central Index Key | 67,625 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 79,200,278 | |
Trading Symbol | MNR | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,018 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2018 | Sep. 30, 2017 |
Real Estate Investments: | ||
Land | $ 197,974,389 | $ 187,224,819 |
Buildings and Improvements | 1,342,261,913 | 1,244,691,715 |
Total Real Estate Investments | 1,540,236,302 | 1,431,916,534 |
Accumulated Depreciation | (188,310,757) | (171,060,478) |
Real Estate Investments | 1,351,925,545 | 1,260,856,056 |
Real Estate Held for Sale | 9,486,257 | 14,606,028 |
Cash and Cash Equivalents | 12,470,188 | 10,226,046 |
Securities Available for Sale at Fair Value | 144,630,426 | 123,764,770 |
Tenant and Other Receivables | 1,743,865 | 1,753,054 |
Deferred Rent Receivable | 8,772,807 | 8,049,275 |
Prepaid Expenses | 9,339,758 | 5,434,874 |
Intangible Assets, net of Accumulated Amortization of $13,267,014 and $13,404,318, respectively | 11,934,269 | 10,010,165 |
Capitalized Lease Costs, net of Accumulated Amortization of $3,331,272 and $3,393,187, respectively | 4,271,380 | 4,180,907 |
Financing Costs, net of Accumulated Amortization of $807,345 and $619,555, respectively | 687,919 | 875,709 |
Other Assets | 4,629,158 | 3,280,871 |
TOTAL ASSETS | 1,559,891,572 | 1,443,037,755 |
Liabilities: | ||
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs | 632,051,233 | 591,364,371 |
Loans Payable | 154,341,511 | 120,091,417 |
Accounts Payable and Accrued Expenses | 2,497,405 | 4,450,753 |
Other Liabilities | 20,643,642 | 14,265,518 |
Total Liabilities | 809,533,791 | 730,172,059 |
Shareholders’ Equity: | ||
Common Stock, $0.01 Par Value Per Share: 192,039,750 Shares Authorized as of March 31, 2018 and September 30, 2017; 78,846,177 and 75,630,521 Shares Issued and Outstanding as of March 31, 2018 and September 30, 2017, respectively | 788,462 | 756,305 |
Excess Stock, $0.01 Par Value Per Share: 200,000,000 Shares Authorized as of March 31, 2018 and September 30, 2017; No Shares Issued or Outstanding as of March 31, 2018 and September 30, 2017 | 0 | 0 |
Additional Paid-In Capital | 503,309,572 | 459,552,701 |
Accumulated Other Comprehensive Income (Loss) | (31,124,653) | 6,570,565 |
Undistributed Income | 0 | 0 |
Total Shareholders’ Equity | 750,357,781 | 712,865,696 |
TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY | 1,559,891,572 | 1,443,037,755 |
Series C Preferred Stock [Member] | ||
Shareholders’ Equity: | ||
6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: 12,400,000 Shares Authorized as of March 31, 2018 and September 30, 2017; 11,095,376 and 9,839,445 Shares Issued and Outstanding as of March 31, 2018 and September 30, 2017, respectively | $ 277,384,400 | $ 245,986,125 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Mar. 31, 2018 | Sep. 30, 2017 |
Accumulated amortization of intangible assets | $ 13,267,014 | $ 13,404,318 |
Accumulated amortization of lease costs | 3,331,272 | 3,393,187 |
Accumulated amortization of financing costs | $ 807,345 | $ 619,555 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 192,039,750 | 192,039,750 |
Common Stock, shares issued | 78,846,177 | 75,630,521 |
Common Stock, shares outstanding | 78,846,177 | 75,630,521 |
Excess Stock, par value | $ 0.01 | $ 0.01 |
Excess Stock , shares authorized | 200,000,000 | 200,000,000 |
Excess Stock , shares issued | ||
Excess Stock , shares outstanding | ||
Series C Preferred Stock [Member] | ||
Cumulative redeemable preferred, stock dividend rate | 6.125% | 6.125% |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 12,400,000 | 12,400,000 |
Preferred stock, shares issued | 11,095,376 | 9,839,445 |
Preferred stock, shares outstanding | 11,095,376 | 9,839,445 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | |
INCOME: | ||||
Rental Revenue | $ 28,609,985 | $ 23,610,830 | $ 56,302,467 | $ 46,891,686 |
Reimbursement Revenue | 5,011,523 | 3,697,361 | 10,060,863 | 7,598,116 |
Lease Termination Income | 0 | 0 | 210,261 | 0 |
TOTAL INCOME | 33,621,508 | 27,308,191 | 66,573,591 | 54,489,802 |
EXPENSES: | ||||
Real Estate Taxes | 3,779,648 | 2,851,862 | 7,642,311 | 5,758,843 |
Operating Expenses | 1,476,295 | 1,288,265 | 2,912,536 | 2,582,733 |
General & Administrative Expenses | 2,218,037 | 2,078,538 | 4,165,069 | 3,521,001 |
Acquisition Costs | 0 | 0 | 0 | 178,526 |
Depreciation | 8,858,062 | 7,139,077 | 17,342,046 | 14,131,572 |
Amortization of Capitalized Lease Costs and Intangible Assets | 588,622 | 427,756 | 1,126,693 | 875,553 |
TOTAL EXPENSES | 16,920,664 | 13,785,498 | 33,188,655 | 27,048,228 |
OTHER INCOME (EXPENSE): | ||||
Dividend and Interest Income | 2,888,210 | 1,439,182 | 5,752,427 | 2,731,333 |
Gain on Sale of Securities Transactions | 11,234 | 0 | 111,387 | 806,108 |
Interest Expense, including Amortization of Financing Costs | (7,955,285) | (6,537,264) | (15,361,232) | (12,700,483) |
TOTAL OTHER INCOME (EXPENSE) | (5,055,841) | (5,098,082) | (9,497,418) | (9,163,042) |
INCOME FROM CONTINUING OPERATIONS, BEFORE GAIN ON SALE OF REAL ESTATE INVESTMENTS | 11,645,003 | 8,424,611 | 23,887,518 | 18,278,532 |
Gain on Sale of Real Estate Investments | 0 | 0 | 5,387,886 | 0 |
NET INCOME | 11,645,003 | 8,424,611 | 29,275,404 | 18,278,532 |
Less: Preferred Dividends | 4,248,219 | 3,582,036 | 8,565,165 | 7,279,796 |
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ 7,396,784 | $ 4,842,575 | $ 20,710,239 | $ 10,998,736 |
BASIC INCOME – PER SHARE | ||||
Net Income | $ 0.15 | $ 0.12 | $ 0.38 | $ 0.26 |
Less: Preferred Dividends | (0.05) | (0.05) | (0.11) | (0.10) |
Net Income Attributable to Common Shareholders - Basic | 0.10 | 0.07 | 0.27 | 0.16 |
DILUTED INCOME – PER SHARE | ||||
Net Income | 0.15 | 0.12 | 0.38 | 0.26 |
Less: Preferred Dividends | (0.05) | (0.05) | (0.11) | (0.10) |
Net Income Attributable to Common Shareholders - Diluted | $ 0.10 | $ 0.07 | $ 0.27 | $ 0.16 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | ||||
Basic | 77,992,007 | 71,243,381 | 77,174,821 | 70,456,222 |
Diluted | 78,155,938 | 71,406,875 | 77,362,197 | 70,607,766 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 11,645,003 | $ 8,424,611 | $ 29,275,404 | $ 18,278,532 |
Other Comprehensive Income: | ||||
Unrealized Holding Gains (Losses) Arising During the Period | (26,970,847) | 2,175,171 | (37,583,831) | 234,130 |
Reclassification Adjustment for Net Gains Realized in Income | (11,234) | 0 | (111,387) | (806,108) |
TOTAL COMPREHENSIVE INCOME (LOSS) | (15,337,078) | 10,599,782 | (8,419,814) | 17,706,554 |
Less: Preferred Dividends | 4,248,219 | 3,582,036 | 8,565,165 | 7,279,796 |
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ (19,585,297) | $ 7,017,746 | $ (16,984,979) | $ 10,426,758 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net Income | $ 29,275,404 | $ 18,278,532 |
Noncash Items Included in Net Income: | ||
Depreciation & Amortization | 19,065,189 | 15,673,022 |
Deferred Straight Line Rent | (756,486) | (629,856) |
Stock Compensation Expense | 242,170 | 266,345 |
Gain on Sale of Securities Transactions | (111,387) | (806,108) |
(Gain) / Loss on Sale of Real Estate Investments | (5,387,886) | 95,336 |
Changes In: | ||
Tenant & Other Receivables | 850,945 | 1,082,191 |
Prepaid Expenses | (3,904,884) | (3,135,027) |
Other Assets & Capitalized Lease Costs | 20,263 | (839,704) |
Accounts Payable, Accrued Expenses & Other Liabilities | 3,545,246 | 861,044 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 42,838,574 | 30,845,775 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of Real Estate & Intangible Assets | (110,045,832) | (56,101,538) |
Capital Improvements | (2,310,665) | (1,013,209) |
Proceeds from Sale of Real Estate Investments | 10,499,704 | 4,125,819 |
Return of Deposits on Real Estate | 450,000 | 1,000,000 |
Deposits Paid on Acquisitions of Real Estate | (1,200,000) | (1,575,000) |
Proceeds from Sale of Securities Available for Sale | 2,619,433 | 3,739,239 |
Purchase of Securities Available for Sale | (61,068,920) | (29,305,625) |
NET CASH USED IN INVESTING ACTIVITIES | (161,056,280) | (79,130,314) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Net Draws (Repayments) on Loans Payable | 34,250,094 | (54,790,684) |
Proceeds from Fixed Rate Mortgage Notes Payable | 67,100,000 | 38,000,000 |
Principal Payments on Fixed Rate Mortgage Notes Payable | (26,225,677) | (37,700,474) |
Financing Costs Paid on Debt | (596,121) | (660,702) |
Proceeds from the Exercise of Stock Options | 569,600 | 0 |
Redemption of 7.625% Series A Preferred Stock | 0 | (53,493,750) |
Proceeds from Underwritten Public Offering of Preferred Stock, net of offering costs | 0 | 71,017,493 |
Proceeds from At-The-Market Preferred Equity Program, net of offering costs | 30,941,972 | 0 |
Proceeds from Issuance of Common Stock in the DRIP, net of Dividend Reinvestments | 42,996,991 | 37,812,970 |
Preferred Dividends Paid | (8,301,342) | (6,621,359) |
Common Dividends Paid, net of Reinvestments | (20,273,669) | (18,076,564) |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 120,461,848 | (24,513,070) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 2,244,142 | (72,797,609) |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 10,226,046 | 95,749,508 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | $ 12,470,188 | $ 22,951,899 |
Consolidated Statements of Cas7
Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) | 6 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Series A Preferred Stock [Member] | ||
Preferred stock dividend rate | 7.625% |
Organization and Accounting Pol
Organization and Accounting Policies | 6 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Accounting Policies | NOTE 1 – ORGANIZATION AND ACCOUNTING POLICIES Monmouth Real Estate Investment Corporation, a Maryland corporation, together with its consolidated subsidiaries (we, our, us, the Company or MREIC), operates as a real estate investment trust (REIT) deriving its income primarily from real estate rental operations. As of March 31, 2018, we owned 109 properties with total square footage of approximately 19,928,000, which was 99.2% occupied, as compared to 108 properties with total square footage of approximately 18,790,000, which was 99.3% occupied as of September 30, 2017. These properties are located in 30 states: Alabama, Arizona, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Washington and Wisconsin. As of the quarter ended March 31, 2018, our weighted average lease maturity was approximately 7.8 years and our annualized average base rent per occupied square foot was $5.91. As of March 31, 2018, the weighted average building age, based on the square footage of our buildings, was 9.2 years. Subsequent to quarter end, we purchased a newly constructed 399,440 square foot industrial building located in Daytona Beach, FL. We also own a portfolio of REIT investment securities, which we generally limit to no more than approximately 10% of our undepreciated assets (which is our total assets, excluding accumulated depreciation). Total assets excluding accumulated depreciation were $1,748,202,329 as of March 31, 2018. We held $144,630,426 in marketable REIT securities as of March 31, 2018, representing 8.3% of our undepreciated assets. We have elected to be taxed as a REIT under Sections 856-860 of the Internal Revenue Code of 1986, as amended (the Code), and we intend to maintain our qualification as a REIT in the future. As a qualified REIT, with limited exceptions, we will not be taxed under Federal and certain state income tax laws at the corporate level on taxable income that we distribute to our shareholders. For special tax provisions applicable to REITs, refer to Sections 856-860 of the Code. We are subject to franchise taxes in several of the states in which we own properties. In December 2017, the Tax Cuts and Jobs Act of 2017 (the Act), Code Section 199A, was added to the Code and became effective for tax years beginning after December 31, 2017 and before January 1, 2026. Under the Act, subject to certain income limitations, an individual taxpayer may deduct 20% of the aggregate amount of qualified REIT dividends they receive from their taxable income. Qualified REIT dividends do not include any portion of a dividend received from a REIT that is classified as a capital gain dividend. The interim Consolidated Financial Statements furnished herein have been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (U.S. GAAP) applicable to interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year ending September 30, 2018. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in our annual report on Form 10-K for the fiscal year ended September 30, 2017. Use of Estimates In preparing the financial statements in accordance with U.S. GAAP, we are required to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods and related disclosure of contingent assets and liabilities. Actual results could differ from these estimates and assumptions. Reclassification Certain prior period amounts in the accompanying Consolidated Financial Statements have been reclassified to conform to the current period’s presentation. Lease Termination Income Lease Termination Income is recognized in operating revenues when there is a signed termination agreement, all of the conditions of the agreement have been met, the tenant is no longer occupying the property and the termination consideration is probable of collection. Lease termination amounts are paid by tenants who want to terminate their lease obligations before the end of the contractual term of the lease agreement with us. Two leases that were set to expire during fiscal 2018 were leased to Kellogg Sales Company (Kellogg) at our 65,067 square foot facility located in Kansas City, MO through July 31, 2018 and at our 50,400 square foot facility located in Orangeburg, NY through February 28, 2018. Kellogg informed us that they would not be renewing these leases. On December 18, 2017, we sold our property, located in Kansas City, MO for $4,900,000, with net sale proceeds to us of approximately $4,602,000 and on December 22, 2017, we sold our property, located in Orangeburg, NY for $6,170,000, with net sale proceeds to us of approximately $5,898,000. The sale of these two properties resulted in a realized gain of approximately $5,388,000, representing a 105% gain over the depreciated U.S. GAAP basis and a realized net gain of approximately $1,804,000, representing a 21% net gain over our historic undepreciated cost basis. In conjunction with the sale of these two properties, we simultaneously entered into a lease termination agreement for each property whereby we received a termination fee from Kellogg totaling approximately $210,000 which represents a weighted average of 80% of the then remaining rent due under each respective lease. Only four of our 109 properties have leases that contain an early termination provision. These four properties contain approximately 184,000 total rentable square feet, representing less than 1% of our total rentable square feet. Our leases with early termination provisions are our 26,340 square foot location in Ridgeland (Jackson), MS, our 36,270 square foot location in Urbandale (Des Moines), IA, our 38,833 square foot location in Rockford, IL, and our 83,000 square foot location in Roanoke, VA. Each lease termination provision contains certain requirements that must be met in order to exercise each termination provision. These requirements include: the date termination can be exercised, the time frame that notice must be given by the tenant to us and the termination fee that would be required to be paid by the tenant to us. The total potential termination fee to be paid to us from the four tenants with leases that have a termination provision amounts to approximately $1,681,000. Stock Compensation Plan We account for awards of stock options and restricted stock in accordance with ASC 718-10, “Compensation-Stock Compensation”. ASC 718-10 requires that compensation cost for all stock awards be calculated and amortized over the service period (generally equal to the vesting period). The compensation cost for stock option grants is determined using option pricing models, intended to estimate the fair value of the awards at the grant date less estimated forfeitures. The compensation expense for restricted stock is recognized based on the fair value of the restricted stock awards less estimated forfeitures. The fair value of restricted stock awards is equal to the fair value of our stock on the grant date. The amortization of compensation costs for stock option grants and restricted stock are included in General and Administrative Expenses in the accompanying Consolidated Statements of Income and amounted to $111,407 and $166,190 for the three months ended March 31, 2018 and 2017, respectively and amounted to $242,170 and $266,345 for the six months ended March 31, 2018 and 2017, respectively. During the six months ended March 31, 2018 and 2017, the following stock options, which vest one year after grant date, were granted under our Stock Option Plan: Date of Grant Number of Employees Number of Shares Option Price Expiration Date 1/3/18 1 65,000 $ 17.80 1/3/26 1/4/17 1 65,000 $ 15.04 1/4/25 12/9/16 10 215,000 $ 14.24 12/9/24 The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated: Fiscal 2018 Fiscal 2017 Dividend yield 3.82 % 4.44 % Expected volatility 16.45 % 18.84 % Risk-free interest rate 2.37 % 2.26 % Expected lives (years) 8 8 Estimated forfeitures -0- -0- The weighted-average fair value of options granted during the six months ended March 31, 2018 and 2017 was $1.84 and $1.49 per option, respectively. During the six months ended March 31, 2018 and 2017, 12,500 and -0- shares of restricted stock were granted. During the six months ended March 31, 2018, three participants exercised options awarded under the Plan to purchase an aggregate of 40,000 shares of common stock at a weighted average exercise price of $14.24 per share for total proceeds of $569,600. During the six months ended March 31, 2017, no options were exercised. As of March 31, 2018, a total of 1,673,706 shares were available for grant as stock options, as restricted stock, or other equity based awards, plus any shares subject to outstanding options that expire or are forfeited without being exercised. As of March 31, 2018, there were outstanding options to purchase 695,000 shares with an aggregate intrinsic value of $2,171,900. Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, “Leases”. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. ASU 2016-02 will be effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted. We are continuing to evaluate the potential impact this standard may have on our consolidated financial statements and the timing of adoption. The most significant changes related to lessor accounting under ASU 2016-02 include bifurcating revenue into lease and non-lease components and the new standard’s narrow definition of initial direct costs for leases. Since our revenue is primarily derived from leasing activities from long-term net leases and since we currently do not capitalize indirect costs for leases, we believe that we will continue to account for our leases and related leasing costs in substantially the same manner as we currently do once the adoption of the ASU 2016-02 becomes effective. In January 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities”. ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. These changes become effective for our fiscal year beginning October 1, 2018. We anticipate that the most significant change for us, once ASU 2016-01 is adopted, will be the accounting for our investments in marketable securities classified as available for sale, which are currently carried at fair value with unrealized holding gains and losses being excluded from earnings and reported as a separate component of Shareholders’ Equity until realized and the change in net unrealized holding gains and losses being reflected as comprehensive income (loss). Under ASU 2016-01, these marketable securities will continue to be measured at fair value, however the changes in net unrealized holding gains and losses will be recognized through net income. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers”. The FASB issued further guidance in ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, that provides clarifying guidance in certain narrow areas and adds some practical expedients. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The effective date of ASU 2014-09 was extended by one year by ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”. The new standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017. Therefore, we expect to adopt the standard effective October 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method, and we are evaluating which transition method we will elect. We are also in the process of evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. Our revenue is primarily derived from leasing activities and historically our property dispositions have been cash sales with no contingencies and no future involvement in the property. Since this standard applies to all contracts with customers except those that are within the scope of other guidance, such as leases, we do not expect the adoption of this standard to have a significant impact on our consolidated financial statements and related disclosures. We do not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying Consolidated Financial Statements. Segment Reporting & Financial Information Our primary business is the ownership and management of real estate properties. We invest in well-located, modern, single tenant, industrial buildings leased primarily to investment-grade tenants or their subsidiaries on long-term net leases. We review operating and financial information for each property on an individual basis and, therefore, each property represents an individual operating segment. We evaluate financial performance using Net Operating Income (NOI) from property operations. NOI is a non-GAAP financial measure, which we define as recurring Rental and Reimbursement Revenue, less Real Estate Taxes and Operating Expenses, such as insurance, utilities and repairs and maintenance. We have aggregated the properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities, including the fact that they are operated as industrial properties subject to long-term net leases primarily to investment-grade tenants or their subsidiaries. |
Net Income Per Share
Net Income Per Share | 6 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | NOTE 2 – NET INCOME PER SHARE Basic Net Income per Common Share is calculated by dividing Net Income Attributable to Common Shareholders by the weighted-average number of common shares outstanding during the period. Diluted Net Income per Common Share is calculated by dividing Net Income Attributable to Common Shareholders by the weighted-average number of common shares outstanding plus the weighted-average number of net shares that would be issued upon exercise of stock options pursuant to the treasury stock method. In addition, common stock equivalents of 163,931 and 163,494 shares are included in the diluted weighted average shares outstanding for the three months ended March 31, 2018 and 2017, respectively, and common stock equivalents of 187,376 and 151,544 shares are included in the diluted weighted average shares outstanding for the six months ended March 31, 2018 and 2017, respectively. For the diluted weighted average shares outstanding for the three months ended March 31, 2018 and 2017, 65,000 options to purchase shares of common stock were antidilutive. For the diluted weighted average shares outstanding for the six months ended March 31, 2018 and 2017, 65,000 and 280,000 options to purchase shares of common stock, respectively, were antidilutive. |
Real Estate Investments
Real Estate Investments | 6 Months Ended |
Mar. 31, 2018 | |
Real Estate [Abstract] | |
Real Estate Investments | NOTE 3 – REAL ESTATE INVESTMENTS On November 2, 2017, we purchased a newly constructed 121,683 square foot industrial building, situated on 16.2 acres, located in Charleston, SC. The building is 100% net-leased to FedEx Corporation (FDX) for 15 years through August 2032. The purchase price was $21,872,170. We obtained a 15 year fully-amortizing mortgage loan of $14,200,000 at a fixed interest rate of 4.23%. Annual rental revenue over the remaining term of the lease averages approximately $1,315,000. On November 30, 2017, we purchased a newly constructed 300,000 square foot industrial building, situated on 123 acres, located in Oklahoma City, OK. The building is 100% net-leased to Amazon.com Services, Inc. for 10 years through October 2027. The lease is guaranteed by Amazon.com, Inc. The purchase price was $30,250,000. We obtained a 10 year mortgage loan, amortizing over 18 years, of $19,600,000 at a fixed interest rate of 3.64%. Annual rental revenue over the remaining term of the lease averages approximately $1,884,000. On January 22, 2018, we purchased a newly constructed 831,764 square foot industrial building, situated on 62.4 acres, located in Savannah, GA. The building is 100% net-leased to Shaw Industries, Inc. for 10 years through September 2027. The purchase price was $57,483,636. We obtained a 14 year fully-amortizing mortgage loan of $33,300,000 at a fixed interest rate of 3.53%. Annual rental revenue over the remaining term of the lease averages approximately $3,551,000. FDX, Amazon.com Services, Inc.’s ultimate parent, Amazon.com, Inc. and Shaw Industries, Inc.’s ultimate parent, Berkshire Hathaway, Inc. are publicly-owned companies and financial information related to these entities is available at the SEC’s website, www.sec.gov We evaluated the property acquisitions which took place during the six months ended March 31, 2018, to determine whether an integrated set of assets and activities meets the definition of a business, pursuant to ASU 2017-01. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions. Accordingly, we accounted for the properties purchased in Charleston, SC, Oklahoma City, OK and Savannah, GA as asset acquisitions and allocated the total cash consideration, including transaction costs of approximately $440,000, to the individual assets acquired on a relative fair value basis. There were no liabilities assumed in these acquisitions. The financial information set forth below summarizes our purchase price allocation for these three properties acquired during the six months ended March 31, 2018 that are accounted for as asset acquisitions: Land $ 10,662,511 Building 96,729,583 In-Place Leases 2,653,738 The following table summarizes the operating results included in our consolidated statements of income for the three and six months ended March 31, 2018 for the properties acquired during the six months ended March 31, 2018: Three Months Ended 3/31/2018 Six Months Ended 3/31/2018 Rental Revenues $ 1,493,699 $ 1,866,996 Net Income Attributable to Common Shareholders 450,211 632,508 Subsequent to quarter end, on April 6, 2018, we purchased a newly constructed 399,440 square foot industrial building, situated on 27.5 acres, located in Daytona Beach, FL. The building is 100% net-leased to B. Braun Medical Inc. for 10 years through April 1, 2028. The purchase price was $30,750,540. We obtained a 15 year fully-amortizing mortgage loan of $19,500,000 at a fixed interest rate of 4.25%. Annual rental revenue over the remaining term of the lease averages approximately $2,128,000. Expansions On November 1, 2017, a parking lot expansion for a property leased to FedEx Ground Package System, Inc., a subsidiary of FDX, located in Indianapolis, IN was completed for a total project cost of approximately $1,683,000, resulting in a new 10 year lease which extended the prior lease expiration date from April 2024 to October 2027. In addition, the expansion resulted in an increase in annual rent effective from the date of completion of approximately $184,000 from approximately $1,533,000, or $4.67 per square foot, to approximately $1,717,000, or $5.24 per square foot. Disposition and Real Estate classified as Held for Sale Two leases that were set to expire during fiscal 2018 were leased to Kellogg Sales Company (Kellogg) at our 65,067 square foot facility located in Kansas City, MO through July 31, 2018 and at our 50,400 square foot facility located in Orangeburg, NY through February 28, 2018. Kellogg informed us that they would not be renewing these leases. On December 18, 2017, we sold our property, located in Kansas City, MO for $4,900,000, with net sale proceeds to us of approximately $4,602,000 and on December 22, 2017, we sold our property, located in Orangeburg, NY for $6,170,000, with net sale proceeds to us of approximately $5,898,000. The sale of these two properties resulted in a realized gain of approximately $5,388,000, representing a 105% gain over the depreciated U.S. GAAP basis and a realized net gain of approximately $1,804,000, representing a 21% net gain over our historic undepreciated cost basis. In conjunction with the sale of these two properties, we simultaneously entered into a lease termination agreement for each property whereby we received a termination fee from Kellogg totaling approximately $210,000 which represents a weighted average of 80% of the then remaining rent due under each respective lease. Real Estate Held for Sale at March 31, 2018 consists of two properties that we have entered into agreements to sell. The two properties consist of an 87,500 square foot facility located in Ft. Myers, FL, which is currently vacant and a 68,370 square foot facility located in Colorado Springs, CO. During the prior year six month period ended March 31, 2017, in October 2016, we sold our 59,425 square foot industrial building situated on 4.78 acres located in White Bear Lake, MN for net proceeds of approximately $4,126,000. Since the sale of the properties located in White Bear Lake, MN, Kansas City, MO and Orangeburg, NY, as well as the two properties that are classified as Real Estate Held for Sale, do not represent a strategic shift that has a major effect on our operations and financial results, the operations generated from these properties are not included in Discontinued Operations. The following table summarizes the operations that are included in the accompanying Consolidated Statements of Income for the three and six months ended March 31, 2018 and 2017 for the three properties sold during the periods presented, prior to their sales, and for the two properties that are classified as Real Estate Held for Sale in the accompanying March 31, 2018 Consolidated Balance Sheets. Three Months Ended Six Months Ended 3/31/2018 3/31/2017 3/31/2018 3/31/2017 Rental and Reimbursement Revenue $ 277,509 $ 534,600 $ 857,271 $ 1,101,506 Lease Termination Income -0- -0- 210,261 -0- Real Estate Taxes (16,894 ) (85,826 ) (227,604 ) (179,992 ) Operating Expenses (36,276 ) (33,036 ) (84,611 ) (97,862 ) Depreciation & Amortization (4,868 ) (130,554 ) (63,410 ) (267,445 ) Interest Expense, including Amortization of Financing Costs (11,962 ) (60,434 ) (26,563 ) (112,982 ) Income from Operations 207,509 224,750 665,344 443,225 Gain (Loss) on Sale of Real Estate Investments -0- -0- 5,387,886 (95,336 ) Net Income $ 207,509 $ 224,750 $ 6,053,230 $ 347,889 Pro forma information The following unaudited pro forma condensed financial information has been prepared utilizing our historical financial statements and the effect of additional revenue and expenses generated from property acquired and expanded during fiscal 2018 to date, and during fiscal 2017, assuming that the acquisitions and completed expansions had occurred as of October 1, 2016, after giving effect to certain adjustments including: (a) Rental Revenue adjustments resulting from the straight-lining of scheduled rent increases, (b) Interest Expense resulting from the assumed increase in Fixed Rate Mortgage Notes Payable and Loans Payable related to the new acquisitions, and (c) Depreciation Expense related to the new acquisitions. In addition, the net proceeds raised from the issuance of our 6.125% Series C Cumulative Redeemable Preferred Stock less the redemptions of our 7.625% Series A Cumulative Redeemable Preferred Stock redeemed on October 14, 2016 and our 7.875% Series B Cumulative Redeemable Preferred Stock redeemed on June 7, 2017 were used to help fund property acquisitions and, therefore, the pro forma preferred dividend expense has been adjusted to account for its effect on Net Income Attributable to Common Shareholders as if all the preferred stock issuances and redemptions had occurred on October 1, 2016. In addition, Net Income Attributable to Common Shareholders excludes the operations of the properties sold during fiscal 2018 and 2017 which were the vacant property located in White Bear Lake, MN that was sold in October 2016, as well as the properties located in Kansas City, MO and in Orangeburg, NY that were sold in December 2017, and also excludes the two properties classified as Real Estate Held for Sale. Furthermore, the proceeds raised from the Dividend Reinvestment and Stock Purchase Plan (the DRIP) were used to fund property acquisitions and expansions and therefore, the weighted average shares outstanding used in calculating the Basic and Diluted Net Income per Share Attributable to Common Shareholders has been adjusted to account for the increase in shares raised through the DRIP, as if all the shares raised had occurred on October 1, 2016. The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisitions and expansions reflected herein been consummated on the dates indicated or that will be achieved in the future. Three Months Ended Six Months Ended 3/31/2018 3/31/2017 3/31/2018 3/31/2017 Rental Revenues $ 29,029,200 $ 29,117,700 $ 58,132,100 $ 58,556,100 Net Income Attributable to Common Shareholders $ 7,116,800 $ 4,631,100 $ 14,844,300 $ 11,082,000 Basic and Diluted Net Income per Share Attributable to Common Shareholders $ 0.09 $ 0.06 $ 0.19 $ 0.14 Tenant Concentration We have a concentration of FDX and FDX subsidiary-leased properties, consisting of 59 separate stand-alone leases covering approximately 9,513,000 square feet as of March 31, 2018 and 55 separate stand-alone leases covering approximately 8,187,000 square feet as of March 31, 2017. The 59 separate stand-alone leases that are leased to FDX and FDX subsidiaries have a weighted average lease maturity of 8.5 years. The percentage of FDX and its subsidiaries leased square footage to the total of our rental space was 48% (8% to FDX and 40% to FDX subsidiaries) as of March 31, 2018 and 49% (6% to FDX and 43% to FDX subsidiaries) as of March 31, 2017. As of March 31, 2018, no other tenant accounted for 5% or more of our total rental space. Annualized Rental and Reimbursement Revenue from FDX and its subsidiaries is estimated to be approximately 60% (7% to FDX and 53% to FDX subsidiaries) of total Rental and Reimbursement Revenue for fiscal 2018 and was 59% (6% to FDX and 53% to FDX subsidiaries) of total Rental and Reimbursement Revenue for fiscal 2017. No other tenant accounted for 5% or more of our total Rental and Reimbursement Revenue for the six months ended March 31, 2018 and 2017. FDX is a publicly-owned company and financial information related to this entity is available at the SEC’s website, www.sec.gov In addition to real estate property holdings, we held $144,630,426 in marketable REIT securities at March 31, 2018, representing 8.3% of our undepreciated assets (which is our total assets excluding accumulated depreciation). These liquid real estate holdings are not included in calculating the tenant concentration ratios above and therefore further enhance our diversification. The securities portfolio provides us with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. |
Securities Available for Sale a
Securities Available for Sale at Fair Value | 6 Months Ended |
Mar. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Securities Available for Sale at Fair Value | NOTE 4 – SECURITIES AVAILABLE FOR SALE AT FAIR VALUE Our Securities Available for Sale at Fair Value consists primarily of marketable common and preferred stock of other REITs with a fair value of $144,630,426 as of March 31, 2018. We generally limit our investment in marketable securities to no more than approximately 10% of our undepreciated assets (which is our total assets excluding accumulated depreciation). Total assets excluding accumulated depreciation were $1,748,202,329 as of March 31, 2018. We held $144,630,426 in marketable REIT securities as of March 31, 2018, representing 8.3% of our undepreciated assets. The REIT securities portfolio provides us with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. During the six months ended March 31, 2018, we sold or redeemed securities with a cost basis of $2,508,046 and recognized a Gain on Sale of Securities Transactions of $111,387. In addition, we recognized dividend income on our investment in securities of $2,885,821 and $5,748,465 for the three and six months ended March 31, 2018. We also made purchases of $61,068,920 in Securities Available for Sale at Fair Value. Of this amount, we made total purchases of 31,041 common shares of UMH Properties, Inc. (UMH), a related REIT, for a total cost of $408,759, or an average cost of $13.17 per share, which were purchased through UMH’s Dividend Reinvestment and Stock Purchase Plan. We owned a total of 1,159,357 UMH common shares as of March 31, 2018 at a total cost of $11,640,610 and a fair value of $15,546,972. We own 100,000 shares of UMH’s 8.00% Series B Cumulative Redeemable Preferred Stock at a total cost of $2,500,000 with a fair value of $2,655,000. The unrealized gain on our investment in UMH’s common and preferred stock as of March 31, 2018 was $4,061,363. As of March 31, 2018, we had total net unrealized holding losses on our securities portfolio of $31,124,653. We consider many factors in determining whether a security is other than temporarily impaired, including the nature of the security and the cause, severity and duration of the impairment. We normally hold REIT securities long-term and have the ability and intent to hold these securities to recovery. The following is a summary of the securities that we have determined to be temporarily impaired as of March 31, 2018: Less than 12 Months 12 Months or Longer Unrealized Unrealized Description of Securities Fair Value Losses Fair Value Losses Preferred stock $ 3,568,452 $ (1,375,222 ) $ -0- $ -0- Common stock 121,494,000 (33,979,327 ) -0- -0- Total $ 125,062,452 $ (35,354,549 ) $ -0- $ -0- The following is a summary of the range of losses: Number of Individual Securities Fair Value Unrealized Losses Range of Loss 3 $ 4,096,452 $ (149,520 ) 1%-5 % 3 35,565,000 (3,711,739 ) 6%-10 % 3 47,527,000 (8,368,816 ) 11%-20 % 3 37,874,000 (23,124,474 ) 21%-50 % 12 $ 125,062,452 $ (35,354,549 ) |
Debt
Debt | 6 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 5 – DEBT For the three months ended March 31, 2018 and 2017, amortization of financing costs included in interest expense was $302,556 and $384,984, respectively. For the six months ended March 31, 2018 and 2017, amortization of financing costs included in interest expense was $596,450 and $665,897, respectively. The following is a summary of our Fixed Rate Mortgage Notes Payable as of March 31, 2018 and September 30, 2017: 3/31/2018 9/30/2017 Amount Weighted Average Interest Rate (1) Amount Weighted Average Interest Rate (1) Fixed Rate Mortgage Notes Payable $ 639,836,890 4.11 % $ 598,962,567 4.18 % Debt Issuance Costs $ 10,987,585 $ 10,597,083 Accumulated Amortization of Debt Issuance Costs (3,201,928 ) (2,998,887 ) Unamortized Debt Issuance Costs $ 7,785,657 $ 7,598,196 Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs $ 632,051,233 $ 591,364,371 (1) Weighted average interest rate excludes amortization of debt issuance costs. As of March 31, 2018, interest payable on these mortgages were at fixed rates ranging from 3.45% to 7.60%, with a weighted average interest rate of 4.11%. This compares to a weighted average interest rate of 4.18% as of September 30, 2017 and 4.37% as of March 31, 2017. As of March 31, 2018, the weighted average loan maturity of the Fixed Rate Mortgage Notes Payable was 11.5 years. This compares to a weighted average loan maturity of the Fixed Rate Mortgage Notes Payable of 11.6 years as of September 30, 2017 and 10.7 years as of March 31, 2017. In connection with the three properties acquired during the six months ended March 31, 2018, which are located in Charleston, SC, Oklahoma City, OK and Savannah, GA (as described in Note 3), we obtained one 15 year fully-amortizing mortgage loan, one 10 year loan amortizing over 18 years and one 14 year fully-amortizing mortgage loan. The three mortgage loans originally totaled $67,100,000 with an original weighted average mortgage loan maturity of 13.0 years and a weighted average interest rate of 3.71%. Subsequent to quarter end, on April 6, 2018, we purchased a newly constructed 399,440 square foot industrial building, situated on 27.5 acres, located in Daytona Beach, FL. The building is 100% net-leased to B. Braun Medical Inc. for 10 years through April 1, 2028. The purchase price was $30,750,540. We obtained a 15 year fully-amortizing mortgage loan of $19,500,000 at a fixed interest rate of 4.25%. Annual rental revenue over the remaining term of the lease averages approximately $2,128,000. During the six months ended March 31, 2018, we fully repaid the mortgage loans for two of our properties located in Richfield, OH and Tampa, FL, totaling approximately $6,160,000. As of March 31, 2018, Loans Payable represented the amount drawn down on our $200,000,000 unsecured line of credit facility (the Facility) in the amount of $110,000,000 and the amount drawn down on our margin loan of $44,341,511. The Facility matures in September 2020 with a one year extension at our option (subject to various conditions as specified in the loan agreement). During the six months ended March 31, 2018, we had no additional draws under the Facility. Availability under the Facility is limited to 60% of the value of the borrowing base properties. The value of the borrowing base properties is determined by applying a capitalization rate to the NOI generated by our unencumbered, wholly-owned industrial properties. Effective, March 22, 2018, the capitalization rate applied to our NOI generated by our unencumbered, wholly-owned industrial properties was lowered from 7.0% to 6.5%. Borrowings under the Facility, will, at our election, either i) bear interest at LIBOR plus 140 basis points to 220 basis points, depending on our leverage ratio, or ii) bear interest at BMO’s prime lending rate plus 40 basis points to 120 basis points, depending on our leverage ratio. Our borrowings as of March 31, 2018, based on our leverage ratio, bear interest at LIBOR plus 170 basis points, which represented an interest rate of 3.58%. In addition, we have a $100,000,000 accordion feature, bringing the total potential availability under the Facility (subject to various conditions as specified in the loan agreement) up to $300,000,000. We also invest in equity securities of other REITs which provides us with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. From time to time, we may purchase these securities on margin when the interest and dividend yields exceed the cost of funds. In general, we may borrow up to 50% of the value of the marketable securities, which was $144,630,426 as of March 31, 2018. As of March 31, 2018, we had $44,341,511 drawn against the margin at an interest rate of 2.00%. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
Shareholders' Equity | NOTE 6 – SHAREHOLDERS’ EQUITY Our authorized stock as of March 31, 2018 consisted of 192,039,750 shares of common stock, of which 78,846,177 shares were issued and outstanding, 12,400,000 authorized shares of 6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 par value per share (6.125% Series C Preferred Stock), of which 11,095,376 were issued and outstanding, and 200,000,000 authorized shares of Excess Stock, $0.01 par value per share, of which none were issued or outstanding. Common Stock On October 2, 2017, our Board of Directors approved a 6.25% increase in our quarterly common stock dividend, raising it to $0.17 per share from $0.16 per share, representing our second dividend increase in three years. These two dividend raises represent a total increase of 13%. The increased dividend represents an annualized dividend rate of $0.68 per share. We have maintained or increased our cash dividend for 26 consecutive years. We raised $49,042,921 (including dividend reinvestments of $6,045,930) from the issuance of 3,161,320 shares of common stock under our DRIP during the six months ended March 31, 2018. During the six months ended March 31, 2018, we paid $26,319,599 in total cash dividends, or $0.17 per share, to common shareholders, of which $6,045,930 was reinvested in the DRIP. On April 2, 2018, our Board of Directors declared a dividend of $0.17 per share to be paid June 15, 2018 to common shareholders of record as of the close of business on May 15, 2018. On January 16, 2018, the Board of Directors reaffirmed our Share Repurchase Program that authorizes us to purchase up to $10,000,000 in the aggregate of our common stock. We may repurchase our shares from time to time if, in the opinion of the Board of Directors, such acquisition is advantageous to us. No shares were repurchased during the six months ended March 31, 2018 and, as of March 31, 2018, we do not own any of our own shares. 6.125% Series C Cumulative Redeemable Preferred Stock During the six months ended March 31, 2018, we paid $8,301,342 in Preferred Dividends, or $0.765625 per share, on our outstanding 6.125% Series C Preferred Stock for the period September 1, 2017 through February 28, 2018. As of March 31, 2018, we have accrued Preferred Dividends of $1,415,816 covering the period March 1, 2018 to March 31, 2018. Dividends on the 6.125% Series C Preferred Stock are cumulative and payable quarterly at an annual rate of $1.53125 per share. The 6.125% Series C Preferred Stock has no maturity date and will remain outstanding indefinitely unless redeemed or otherwise repurchased. Except in limited circumstances relating to our qualification as a REIT, or in connection with a change of control, the 6.125% Series C Preferred Stock is not redeemable prior to September 15, 2021. On and after September 15, 2021, at any time, and from time to time, the 6.125% Series C Preferred Stock will be redeemable in whole, or in part, at our option, at a cash redemption price of $25.00 per share, plus all accrued and unpaid dividends (whether or not declared) to, but not including, the date of redemption. On April 2, 2018, our Board of Directors declared a dividend of $0.3828125 per share to be paid June 15, 2018 to the 6.125% Series C Preferred shareholders of record as of the close of business on May 15, 2018. On June 29, 2017, we entered into an At-The-Market Preferred Equity Program (Preferred Stock ATM Program) with FBR Capital Markets & Co. in which we may, from time to time, offer and sell additional shares of our 6.125% Series C Preferred Stock, with a liquidation preference of $25.00 per share, having an aggregate sales price of up to $100,000,000. We began selling shares through the Preferred Stock ATM Program on July 3, 2017. During the six months ended March 31, 2018, we sold 1,255,931 shares under our Preferred Stock ATM Program at a weighted average price of $25.09 per share, and generated net proceeds, after offering expenses, of approximately $30,942,000. As of March 31, 2018, 11,095,376 shares of the 6.125% Series C Preferred Stock were issued and outstanding. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | NOTE 7 - FAIR VALUE MEASUREMENTS We measure certain financial assets and liabilities at fair value on a recurring basis, including Securities Available for Sale at Fair Value. Our financial assets consist mainly of marketable REIT securities. The fair value of these financial assets was determined using the following inputs at March 31, 2018 and September 30, 2017: Fair Value Measurements at Reporting Date Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of March 31, 2018: Equity Securities – Preferred Stock $ 7,585,530 $ 7,585,530 $ -0- $ -0- Equity Securities – Common Stock 137,040,972 137,040,972 -0- -0- Mortgage Backed Securities 3,924 3,924 -0- -0- Total Securities Available for Sale at Fair Value $ 144,630,426 $ 144,630,426 $ -0- $ -0- As of September 30, 2017: Equity Securities – Preferred Stock $ 11,818,628 $ 11,818,628 $ -0- $ -0- Equity Securities – Common Stock 111,941,806 111,941,806 -0- -0- Mortgage Backed Securities 4,336 4,336 -0- -0- Total Securities Available for Sale at Fair Value $ 123,764,770 $ 123,764,770 $ -0- $ -0- In addition to our investment in Securities Available for Sale at Fair Value, we are required to disclose certain information about fair values of other financial instruments. Estimates of fair value are made at a specific point in time based upon, where available, relevant market prices and information about the financial instrument. Such estimates do not include any premium or discount that could result from offering for sale at one time our entire holding of financial instruments. For a portion of our other financial instruments, no quoted market value exists. Therefore, estimates of fair value are necessarily based on a number of significant assumptions (many of which involve events outside the control of management). Such assumptions include assessments of current economic conditions, perceived risks associated with these financial instruments and their counterparties; future expected loss experience and other factors. Given the uncertainties surrounding these assumptions, the reported fair values represent estimates only, and therefore cannot be compared to the historical accounting model. The use of different assumptions or methodologies is likely to result in significantly different fair value estimates. The fair value of Cash and Cash Equivalents approximates their current carrying amounts since all such items are short term in nature. The fair value of variable rate Loans Payable approximates their current carrying amounts, since such amounts payable are at approximately a weighted-average current market rate of interest. The estimated fair value of Fixed Rate Mortgage Notes Payable is based on discounting the future cash flows at a yearend risk adjusted borrowing rate currently available to us for issuance of debt with similar terms and remaining maturities. These fair value measurements fall within level 2 of the fair value hierarchy. At March 31, 2018, the Fixed Rate Mortgage Notes Payable fair value (estimated based upon expected cash outflows discounted at current market rates) amounted to approximately $643,629,000 and the carrying value amounted to $639,836,890. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 6 Months Ended |
Mar. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | NOTE 8 - SUPPLEMENTAL CASH FLOW INFORMATION Cash paid for interest during the six months ended March 31, 2018 and 2017 was approximately $15,054,000 and $12,108,000, respectively. During the six months ended March 31, 2018 and 2017, we had dividend reinvestments of $6,045,930 and $4,536,751, respectively, which required no cash transfers. |
Contingencies and Commitments
Contingencies and Commitments | 6 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and Commitments | NOTE 9 – CONTINGENCIES AND COMMITMENTS From time to time, we may be subject to claims and litigation in the ordinary course of business. We do not believe that any such claim or litigation will have a material adverse effect on the Consolidated Balance Sheets or results of operations. In addition to the property purchased subsequent to quarter end, as described below in Note 10, we have entered into agreements to purchase two new industrial buildings. One of the purchase commitments is for a new built-to-suit industrial building that is leased to Amazon Fulfillment Services, Inc. and is guaranteed by Amazon.com, Inc. The other purchase commitment is for a new build-to-suit industrial building that is currently being developed in Charleston, SC and is leased to FedEx Ground Package System, Inc. The two new buildings consist of approximately 624,000 square feet, with a weighted average net-leased term of 12.3 years. The total purchase price for these two properties is approximately $80,863,000. Approximately 363,000 square feet, or 58%, is leased to Amazon Fulfillment Services, Inc. and approximately 261,000 square feet, or 42%, is leased to FedEx Ground Package System, Inc. Subject to satisfactory due diligence and other customary closing conditions and requirements, we anticipate closing these transactions sometime during the remainder of fiscal 2018 and the first quarter of fiscal 2019. In connection with one of these properties, we have entered into a commitment to obtain a 15 year, fully-amortizing mortgage loan of $29,860,000 at a fixed rate of 3.82%. We are under contract to sell two properties consisting of (i) an 87,500 square foot vacant building located in Ft. Myers, FL, for $6,400,000, which is approximately $2,400,000 above our U.S. GAAP net book carrying value, and (ii) a 68,370 square foot building located in Colorado Springs, CO for $5,800,000, which was approximately our U.S. GAAP net book carrying value. The completion of these two sales are each anticipated to close during the third quarter of fiscal 2018 and are subject to customary closing conditions and requirements. We have committed to construct a parking lot expansion at a property that is being leased to FedEx Ground Package System, Inc. located in Ft. Mills, SC. The expansion costs are expected to be approximately $1,834,000. Upon completion, annualized rent will be increased by approximately $183,000 from approximately $1,415,000 to approximately $1,598,000. Additionally, the lease will be extended for 10 years from the date of completion. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Mar. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 10 – SUBSEQUENT EVENTS Material subsequent events have been evaluated and are disclosed herein. On April 2, 2018, our Board of Directors declared a common dividend of $0.17 per share to be paid June 15, 2018 to the common shareholders of record as of the close of business on May 15, 2018. On April 2, 2018, our Board of Directors declared a preferred dividend of $0.3828125 per share to be paid June 15, 2018 to the 6.125% Series C Preferred shareholders of record as of the close of business on May 15, 2018. On April 6, 2018, we purchased a newly constructed 399,440 square foot industrial building, situated on 27.5 acres, located in Daytona Beach, FL. The building is 100% net-leased to B. Braun Medical Inc. for 10 years through April 1, 2028. The purchase price was $30,750,540. We obtained a 15 year fully-amortizing mortgage loan of $19,500,000 at a fixed interest rate of 4.25%. Annual rental revenue over the remaining term of the lease averages approximately $2,128,000. |
Organization and Accounting P18
Organization and Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | Use of Estimates In preparing the financial statements in accordance with U.S. GAAP, we are required to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods and related disclosure of contingent assets and liabilities. Actual results could differ from these estimates and assumptions. |
Reclassification | Reclassification Certain prior period amounts in the accompanying Consolidated Financial Statements have been reclassified to conform to the current period’s presentation. |
Lease Termination Income | Lease Termination Income Lease Termination Income is recognized in operating revenues when there is a signed termination agreement, all of the conditions of the agreement have been met, the tenant is no longer occupying the property and the termination consideration is probable of collection. Lease termination amounts are paid by tenants who want to terminate their lease obligations before the end of the contractual term of the lease agreement with us. Two leases that were set to expire during fiscal 2018 were leased to Kellogg Sales Company (Kellogg) at our 65,067 square foot facility located in Kansas City, MO through July 31, 2018 and at our 50,400 square foot facility located in Orangeburg, NY through February 28, 2018. Kellogg informed us that they would not be renewing these leases. On December 18, 2017, we sold our property, located in Kansas City, MO for $4,900,000, with net sale proceeds to us of approximately $4,602,000 and on December 22, 2017, we sold our property, located in Orangeburg, NY for $6,170,000, with net sale proceeds to us of approximately $5,898,000. The sale of these two properties resulted in a realized gain of approximately $5,388,000, representing a 105% gain over the depreciated U.S. GAAP basis and a realized net gain of approximately $1,804,000, representing a 21% net gain over our historic undepreciated cost basis. In conjunction with the sale of these two properties, we simultaneously entered into a lease termination agreement for each property whereby we received a termination fee from Kellogg totaling approximately $210,000 which represents a weighted average of 80% of the then remaining rent due under each respective lease. Only four of our 109 properties have leases that contain an early termination provision. These four properties contain approximately 184,000 total rentable square feet, representing less than 1% of our total rentable square feet. Our leases with early termination provisions are our 26,340 square foot location in Ridgeland (Jackson), MS, our 36,270 square foot location in Urbandale (Des Moines), IA, our 38,833 square foot location in Rockford, IL, and our 83,000 square foot location in Roanoke, VA. Each lease termination provision contains certain requirements that must be met in order to exercise each termination provision. These requirements include: the date termination can be exercised, the time frame that notice must be given by the tenant to us and the termination fee that would be required to be paid by the tenant to us. The total potential termination fee to be paid to us from the four tenants with leases that have a termination provision amounts to approximately $1,681,000. |
Stock Compensation Plan | Stock Compensation Plan We account for awards of stock options and restricted stock in accordance with ASC 718-10, “Compensation-Stock Compensation”. ASC 718-10 requires that compensation cost for all stock awards be calculated and amortized over the service period (generally equal to the vesting period). The compensation cost for stock option grants is determined using option pricing models, intended to estimate the fair value of the awards at the grant date less estimated forfeitures. The compensation expense for restricted stock is recognized based on the fair value of the restricted stock awards less estimated forfeitures. The fair value of restricted stock awards is equal to the fair value of our stock on the grant date. The amortization of compensation costs for stock option grants and restricted stock are included in General and Administrative Expenses in the accompanying Consolidated Statements of Income and amounted to $111,407 and $166,190 for the three months ended March 31, 2018 and 2017, respectively and amounted to $242,170 and $266,345 for the six months ended March 31, 2018 and 2017, respectively. During the six months ended March 31, 2018 and 2017, the following stock options, which vest one year after grant date, were granted under our Stock Option Plan: Date of Grant Number of Employees Number of Shares Option Price Expiration Date 1/3/18 1 65,000 $ 17.80 1/3/26 1/4/17 1 65,000 $ 15.04 1/4/25 12/9/16 10 215,000 $ 14.24 12/9/24 The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated: Fiscal 2018 Fiscal 2017 Dividend yield 3.82 % 4.44 % Expected volatility 16.45 % 18.84 % Risk-free interest rate 2.37 % 2.26 % Expected lives (years) 8 8 Estimated forfeitures -0- -0- The weighted-average fair value of options granted during the six months ended March 31, 2018 and 2017 was $1.84 and $1.49 per option, respectively. During the six months ended March 31, 2018 and 2017, 12,500 and -0- shares of restricted stock were granted. During the six months ended March 31, 2018, three participants exercised options awarded under the Plan to purchase an aggregate of 40,000 shares of common stock at a weighted average exercise price of $14.24 per share for total proceeds of $569,600. During the six months ended March 31, 2017, no options were exercised. As of March 31, 2018, a total of 1,673,706 shares were available for grant as stock options, as restricted stock, or other equity based awards, plus any shares subject to outstanding options that expire or are forfeited without being exercised. As of March 31, 2018, there were outstanding options to purchase 695,000 shares with an aggregate intrinsic value of $2,171,900. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, “Leases”. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. ASU 2016-02 will be effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted. We are continuing to evaluate the potential impact this standard may have on our consolidated financial statements and the timing of adoption. The most significant changes related to lessor accounting under ASU 2016-02 include bifurcating revenue into lease and non-lease components and the new standard’s narrow definition of initial direct costs for leases. Since our revenue is primarily derived from leasing activities from long-term net leases and since we currently do not capitalize indirect costs for leases, we believe that we will continue to account for our leases and related leasing costs in substantially the same manner as we currently do once the adoption of the ASU 2016-02 becomes effective. In January 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities”. ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. These changes become effective for our fiscal year beginning October 1, 2018. We anticipate that the most significant change for us, once ASU 2016-01 is adopted, will be the accounting for our investments in marketable securities classified as available for sale, which are currently carried at fair value with unrealized holding gains and losses being excluded from earnings and reported as a separate component of Shareholders’ Equity until realized and the change in net unrealized holding gains and losses being reflected as comprehensive income (loss). Under ASU 2016-01, these marketable securities will continue to be measured at fair value, however the changes in net unrealized holding gains and losses will be recognized through net income. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers”. The FASB issued further guidance in ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, that provides clarifying guidance in certain narrow areas and adds some practical expedients. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The effective date of ASU 2014-09 was extended by one year by ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”. The new standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017. Therefore, we expect to adopt the standard effective October 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method, and we are evaluating which transition method we will elect. We are also in the process of evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. Our revenue is primarily derived from leasing activities and historically our property dispositions have been cash sales with no contingencies and no future involvement in the property. Since this standard applies to all contracts with customers except those that are within the scope of other guidance, such as leases, we do not expect the adoption of this standard to have a significant impact on our consolidated financial statements and related disclosures. We do not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying Consolidated Financial Statements. |
Segment Reporting & Financial Information | Segment Reporting & Financial Information Our primary business is the ownership and management of real estate properties. We invest in well-located, modern, single tenant, industrial buildings leased primarily to investment-grade tenants or their subsidiaries on long-term net leases. We review operating and financial information for each property on an individual basis and, therefore, each property represents an individual operating segment. We evaluate financial performance using Net Operating Income (NOI) from property operations. NOI is a non-GAAP financial measure, which we define as recurring Rental and Reimbursement Revenue, less Real Estate Taxes and Operating Expenses, such as insurance, utilities and repairs and maintenance. We have aggregated the properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities, including the fact that they are operated as industrial properties subject to long-term net leases primarily to investment-grade tenants or their subsidiaries. |
Organization and Accounting P19
Organization and Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Stock Options Outstanding | During the six months ended March 31, 2018 and 2017, the following stock options, which vest one year after grant date, were granted under our Stock Option Plan: Date of Grant Number of Employees Number of Shares Option Price Expiration Date 1/3/18 1 65,000 $ 17.80 1/3/26 1/4/17 1 65,000 $ 15.04 1/4/25 12/9/16 10 215,000 $ 14.24 12/9/24 |
Schedule of Stock Options, Valuation Assumptions | The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated: Fiscal 2018 Fiscal 2017 Dividend yield 3.82 % 4.44 % Expected volatility 16.45 % 18.84 % Risk-free interest rate 2.37 % 2.26 % Expected lives (years) 8 8 Estimated forfeitures -0- -0- |
Real Estate Investments (Tables
Real Estate Investments (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Real Estate [Abstract] | |
Schedule of Properties Acquired During Period Accounted for Asset Acquisitions | The financial information set forth below summarizes our purchase price allocation for these three properties acquired during the six months ended March 31, 2018 that are accounted for as asset acquisitions: Land $ 10,662,511 Building 96,729,583 In-Place Leases 2,653,738 |
Summary of Consolidated Statements of Income for Properties Acquired | The following table summarizes the operating results included in our consolidated statements of income for the three and six months ended March 31, 2018 for the properties acquired during the six months ended March 31, 2018: Three Months Ended 3/31/2018 Six Months Ended 3/31/2018 Rental Revenues $ 1,493,699 $ 1,866,996 Net Income Attributable to Common Shareholders 450,211 632,508 |
Summary of Income or Operation Statements | The following table summarizes the operations that are included in the accompanying Consolidated Statements of Income for the three and six months ended March 31, 2018 and 2017 for the three properties sold during the periods presented, prior to their sales, and for the two properties that are classified as Real Estate Held for Sale in the accompanying March 31, 2018 Consolidated Balance Sheets. Three Months Ended Six Months Ended 3/31/2018 3/31/2017 3/31/2018 3/31/2017 Rental and Reimbursement Revenue $ 277,509 $ 534,600 $ 857,271 $ 1,101,506 Lease Termination Income -0- -0- 210,261 -0- Real Estate Taxes (16,894 ) (85,826 ) (227,604 ) (179,992 ) Operating Expenses (36,276 ) (33,036 ) (84,611 ) (97,862 ) Depreciation & Amortization (4,868 ) (130,554 ) (63,410 ) (267,445 ) Interest Expense, including Amortization of Financing Costs (11,962 ) (60,434 ) (26,563 ) (112,982 ) Income from Operations 207,509 224,750 665,344 443,225 Gain (Loss) on Sale of Real Estate Investments -0- -0- 5,387,886 (95,336 ) Net Income $ 207,509 $ 224,750 $ 6,053,230 $ 347,889 |
Schedule of Pro Forma Information | Three Months Ended Six Months Ended 3/31/2018 3/31/2017 3/31/2018 3/31/2017 Rental Revenues $ 29,029,200 $ 29,117,700 $ 58,132,100 $ 58,556,100 Net Income Attributable to Common Shareholders $ 7,116,800 $ 4,631,100 $ 14,844,300 $ 11,082,000 Basic and Diluted Net Income per Share Attributable to Common Shareholders $ 0.09 $ 0.06 $ 0.19 $ 0.14 |
Securities Available for Sale21
Securities Available for Sale at Fair Value (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Temporary Impaired Securities | The following is a summary of the securities that we have determined to be temporarily impaired as of March 31, 2018: Less than 12 Months 12 Months or Longer Unrealized Unrealized Description of Securities Fair Value Losses Fair Value Losses Preferred stock $ 3,568,452 $ (1,375,222 ) $ -0- $ -0- Common stock 121,494,000 (33,979,327 ) -0- -0- Total $ 125,062,452 $ (35,354,549 ) $ -0- $ -0- |
Summary of Range of Losses | The following is a summary of the range of losses: Number of Individual Securities Fair Value Unrealized Losses Range of Loss 3 $ 4,096,452 $ (149,520 ) 1%-5 % 3 35,565,000 (3,711,739 ) 6%-10 % 3 47,527,000 (8,368,816 ) 11%-20 % 3 37,874,000 (23,124,474 ) 21%-50 % 12 $ 125,062,452 $ (35,354,549 ) |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Summary of Fixed Rate Mortgage Notes Payable | The following is a summary of our Fixed Rate Mortgage Notes Payable as of March 31, 2018 and September 30, 2017: 3/31/2018 9/30/2017 Amount Weighted Average Interest Rate (1) Amount Weighted Average Interest Rate (1) Fixed Rate Mortgage Notes Payable $ 639,836,890 4.11 % $ 598,962,567 4.18 % Debt Issuance Costs $ 10,987,585 $ 10,597,083 Accumulated Amortization of Debt Issuance Costs (3,201,928 ) (2,998,887 ) Unamortized Debt Issuance Costs $ 7,785,657 $ 7,598,196 Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs $ 632,051,233 $ 591,364,371 (1) Weighted average interest rate excludes amortization of debt issuance costs. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value of Financial Assets | The fair value of these financial assets was determined using the following inputs at March 31, 2018 and September 30, 2017: Fair Value Measurements at Reporting Date Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of March 31, 2018: Equity Securities – Preferred Stock $ 7,585,530 $ 7,585,530 $ -0- $ -0- Equity Securities – Common Stock 137,040,972 137,040,972 -0- -0- Mortgage Backed Securities 3,924 3,924 -0- -0- Total Securities Available for Sale at Fair Value $ 144,630,426 $ 144,630,426 $ -0- $ -0- As of September 30, 2017: Equity Securities – Preferred Stock $ 11,818,628 $ 11,818,628 $ -0- $ -0- Equity Securities – Common Stock 111,941,806 111,941,806 -0- -0- Mortgage Backed Securities 4,336 4,336 -0- -0- Total Securities Available for Sale at Fair Value $ 123,764,770 $ 123,764,770 $ -0- $ -0- |
Organization and Accounting P24
Organization and Accounting Policies (Details Narrative) | Mar. 31, 2018USD ($)ft²aProperties$ / sharesshares | Dec. 22, 2017USD ($) | Dec. 18, 2017USD ($) | Mar. 31, 2018USD ($)ft²aProperties$ / sharesshares | Mar. 31, 2017USD ($) | Mar. 31, 2018USD ($)ft²aProperties$ / sharesshares | Mar. 31, 2017USD ($)$ / sharesshares | Sep. 30, 2017aProperties |
Number of real estate properties owned | Properties | 109 | 109 | 109 | 108 | ||||
Total square foot of property | a | 19,928,000 | 19,928,000 | 19,928,000 | 18,790,000 | ||||
Percentage of properties occupied | 99.20% | 99.30% | ||||||
Weighted average building age | 7 years 9 months 18 days | |||||||
Annualized average base rent per square foot | $ / shares | $ 5.91 | $ 5.91 | $ 5.91 | |||||
REIT investment securities, description | We also own a portfolio of REIT investment securities, which we generally limit to no more than approximately 10% of our undepreciated assets (which is our total assets, excluding accumulated depreciation). | |||||||
Total gross real estate investments | $ 1,748,202,329 | $ 1,748,202,329 | $ 1,748,202,329 | |||||
Marketable REIT securities investments | $ 144,630,426 | |||||||
Percentage of undepreciated assets | 8.30% | |||||||
Gain on real estate properties | $ 5,388,000 | |||||||
Percentage of gain on properties | 105.00% | 105.00% | 105.00% | |||||
Net gain on historic cost | $ 1,804,000 | |||||||
Percentage of net gain over the historic cost basis | 21.00% | 21.00% | 21.00% | |||||
Potential lease termination income | $ 0 | |||||||
Stock based compensation expense | $ 111,407 | $ 166,190 | $ 242,170 | $ 266,345 | ||||
Weighted average fair value of stock option | $ / shares | $ 1.84 | $ 1.49 | ||||||
Number Restricted stock shares granted | shares | 12,500 | 0 | ||||||
Weighted average exercise price per share | $ / shares | $ 14.24 | |||||||
Total proceeds | $ 569,600 | $ 0 | ||||||
Number of stock option exercised | shares | 40,000 | 0 | ||||||
Stock option shares available for grant | shares | 1,673,706 | 1,673,706 | 1,673,706 | |||||
Option to purchase shares outstanding | shares | 695,000 | |||||||
Aggregate intrinsic value of options | $ 2,171,900 | $ 2,171,900 | $ 2,171,900 | |||||
Four Lease [Member] | ||||||||
Potential lease termination income | $ 1,681,000 | |||||||
Kansas City, MO (Kellogg) [Member] | ||||||||
Total square foot of property | a | 65,067 | 65,067 | 65,067 | |||||
Value of property sold | $ 4,900,000 | |||||||
Proceeds from sale of property | $ 4,602,000 | |||||||
Percentage of weighted average lease termination income | 80.00% | |||||||
Orangeburg NY [Member] | ||||||||
Total square foot of property | ft² | 50,400 | 50,400 | 50,400 | |||||
Value of property sold | $ 6,170,000 | |||||||
Proceeds from sale of property | $ 5,898,000 | |||||||
Kansas City, MO and Orangeburg, NY [Member] | ||||||||
Percentage of weighted average lease termination income | 80.00% | |||||||
Four Properties [Member] | ||||||||
Total square foot of property | a | 184,000 | 184,000 | 184,000 | |||||
Percentage of properties occupied | 1.00% | |||||||
Ridgeland (Jackson), MS [Member] | ||||||||
Total square foot of property | a | 26,340 | 26,340 | 26,340 | |||||
Urbandale (Des Moines), IA [Member] | ||||||||
Total square foot of property | a | 36,270 | 36,270 | 36,270 | |||||
Rockford, IL (Sherwin-Williams Co.) [Member] | ||||||||
Total square foot of property | a | 38,833 | 38,833 | 38,833 | |||||
Roanoke, VA (FDX Ground) [Member] | ||||||||
Total square foot of property | a | 83,000 | 83,000 | 83,000 | |||||
Buildings [Member] | ||||||||
Weighted average building age | 9 years 2 months 12 days |
Organization and Accounting P25
Organization and Accounting Policies - Summary of Stock Options Outstanding (Details) | 6 Months Ended |
Mar. 31, 2017Employee$ / sharesshares | |
Stock Options [Member] | |
Date of Grant | Jan. 3, 2018 |
Number of Employees | Employee | 1 |
Number of Shares | shares | 65,000 |
Option Price | $ / shares | $ 17.80 |
Expiration Date | Jan. 3, 2026 |
Stock Options One [Member] | |
Date of Grant | Jan. 4, 2017 |
Number of Employees | Employee | 1 |
Number of Shares | shares | 65,000 |
Option Price | $ / shares | $ 15.04 |
Expiration Date | Jan. 4, 2025 |
Stock Options Two [Member] | |
Date of Grant | Dec. 9, 2016 |
Number of Employees | Employee | 10 |
Number of Shares | shares | 215,000 |
Option Price | $ / shares | $ 14.24 |
Expiration Date | Dec. 9, 2024 |
Organization and Accounting P26
Organization and Accounting Policies - Schedule of Stock Options, Valuation Assumptions (Details) - shares | 6 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Dividend yield | 3.82% | 4.44% |
Expected volatility | 16.45% | 18.84% |
Risk-free interest rate | 2.37% | 2.26% |
Expected lives (years) | 8 years | 8 years |
Estimated forfeitures | 0 | 0 |
Net Income Per Share (Details N
Net Income Per Share (Details Narrative) - shares | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings Per Share [Abstract] | ||||
Common stock equivalents included in the diluted weighted average shares outstanding | 163,931 | 163,494 | 187,376 | 151,544 |
Antidilutive securities | 65,000 | 65,000 | 65,000 | 280,000 |
Real Estate Investments (Detail
Real Estate Investments (Details Narrative) | Apr. 06, 2018USD ($)ft²a | Jan. 22, 2018USD ($)ft²a | Dec. 22, 2017USD ($) | Dec. 18, 2017USD ($) | Nov. 30, 2017USD ($)ft²a | Nov. 02, 2017USD ($)ft²a$ / shares | Oct. 31, 2016USD ($)ft²a | Mar. 31, 2018USD ($)ft²a | Mar. 31, 2017USD ($) | Mar. 31, 2018USD ($)ft²a | Mar. 31, 2017USD ($)ft² | Sep. 30, 2017a |
Transaction costs | $ 440,000 | |||||||||||
Total square foot of property | a | 19,928,000 | 19,928,000 | 18,790,000 | |||||||||
Gain on real estate properties | $ 5,388,000 | |||||||||||
Percentage of gain on properties | 105.00% | 105.00% | ||||||||||
Net gain on historic cost | $ 1,804,000 | |||||||||||
Percentage of net gain over the historic cost basis | 21.00% | 21.00% | ||||||||||
Lease termination income | $ 0 | $ 0 | $ 210,261 | $ 0 | ||||||||
Weighted average lease maturity | 7 years 9 months 18 days | |||||||||||
Held marketable securities | $ 144,630,426 | $ 144,630,426 | ||||||||||
Percentage of un depreciated assets | 8.30% | |||||||||||
Series C Cumulative Redeemable Preferred Stock [Member] | ||||||||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | 6.125% | ||||||||||
Series A Cumulative Redeemable Preferred Stock [Member] | ||||||||||||
Cumulative redeemable preferred, stock dividend rate | 7.625% | 7.625% | ||||||||||
Series B Cumulative Redeemable Preferred Stock [Member] | ||||||||||||
Cumulative redeemable preferred, stock dividend rate | 7.875% | 7.875% | ||||||||||
FedEx Corporation [Member] | ||||||||||||
Percentage of real estate property leased | 8.00% | 6.00% | ||||||||||
FedEx Corporation [Member] | Rental And Reimbursement Revenue [Member] | ||||||||||||
Percentage of aggregate rental and reimbursement revenue | 6.00% | |||||||||||
FedEx Corporation [Member] | Rental And Reimbursement Revenue [Member] | Fiscal Year 2018 [Member] | ||||||||||||
Percentage of aggregate rental and reimbursement revenue | 7.00% | |||||||||||
Fedex Ground Package System Inc. [Member] | ||||||||||||
Lease term | 10 years | |||||||||||
Cost of building expansion | $ 1,683,000 | |||||||||||
Lease expiration date description | extended the prior lease expiration date from April 2024 to October 2027 | |||||||||||
Increase in rent | $ 184,000 | |||||||||||
Rent prior to expansion | $ 1,533,000 | |||||||||||
Rent prior to expansion, per square foot | $ / shares | $ 4.67 | |||||||||||
Rent increase to after expansion | $ 1,717,000 | |||||||||||
Rent increase to after expansion, per square foot | $ / shares | $ 5.24 | |||||||||||
Kansas City, MO (Kellogg) [Member] | ||||||||||||
Total square foot of property | a | 65,067 | 65,067 | ||||||||||
Value of property sold | $ 4,900,000 | |||||||||||
Proceeds from sale of property | $ 4,602,000 | |||||||||||
Percentage of weighted average lease termination income | 80.00% | |||||||||||
Kansas City, MO (Kellogg) [Member] | July 31, 2018 [Member] | ||||||||||||
Area of property | ft² | 65,057 | 65,057 | ||||||||||
Orangeburg NY [Member] | ||||||||||||
Total square foot of property | ft² | 50,400 | 50,400 | ||||||||||
Value of property sold | $ 6,170,000 | |||||||||||
Proceeds from sale of property | $ 5,898,000 | |||||||||||
Kansas City, MO (Kellogg) and Orangeburg [Member] | ||||||||||||
Lease termination income | $ 210,000 | |||||||||||
Ft. Myers [Member] | ||||||||||||
Total square foot of property | ft² | 87,500 | 87,500 | ||||||||||
Colorado Springs, CO [Member] | ||||||||||||
Total square foot of property | ft² | 68,370 | 68,370 | ||||||||||
Fedex And Fedex Subsidiaries [Member] | ||||||||||||
Square feet of real estate property leased | ft² | 9,513,000 | 8,187,000 | ||||||||||
Weighted average lease maturity | 8 years 6 months | |||||||||||
Percentage of real estate property leased | 48.00% | 49.00% | ||||||||||
Percentage of rental space and tenant account, description | no other tenant accounted for 5% or more of our total rental space | |||||||||||
Fedex And Fedex Subsidiaries [Member] | Rental And Reimbursement Revenue [Member] | ||||||||||||
Percentage of rental space and tenant account, description | no other tenant accounted for 5% or more of our total rental | no other tenant accounted for 5% or more of our total rental | ||||||||||
Fedex And Fedex Subsidiaries [Member] | Rental And Reimbursement Revenue [Member] | Fiscal Year 2018 [Member] | ||||||||||||
Percentage of aggregate rental and reimbursement revenue | 60.00% | |||||||||||
Fedex And Fedex Subsidiaries [Member] | Rental And Reimbursement Revenue [Member] | Fiscal Year 2017 [Member] | ||||||||||||
Percentage of aggregate rental and reimbursement revenue | 59.00% | |||||||||||
Fedex Corporation Subsidiaries Member [Member] | ||||||||||||
Percentage of real estate property leased | 40.00% | 43.00% | ||||||||||
Fedex Corporation Subsidiaries Member [Member] | Rental And Reimbursement Revenue [Member] | Fiscal Year 2018 [Member] | ||||||||||||
Percentage of aggregate rental and reimbursement revenue | 53.00% | |||||||||||
Fedex Corporation Subsidiaries Member [Member] | Rental And Reimbursement Revenue [Member] | Fiscal Year 2017 [Member] | ||||||||||||
Percentage of aggregate rental and reimbursement revenue | 53.00% | |||||||||||
Industrial Buildings [Member] | FedEx Corporation [Member] | ||||||||||||
Purchase of industrial building | ft² | 121,683 | |||||||||||
Area of property | a | 16.2 | |||||||||||
Percentage of building area leased | 100.00% | |||||||||||
Lease term | 15 years | |||||||||||
Lease term expiration period | Aug. 31, 2032 | |||||||||||
Purchase price of industrial building | $ 21,872,170 | |||||||||||
Mortgage loan amortization period | 15 years | |||||||||||
Face amount of mortgages | $ 14,200,000 | |||||||||||
Mortgage loans on real estate, interest rate | 4.23% | |||||||||||
Annual rental income over the remaining term of lease | $ 1,315,000 | |||||||||||
Industrial Buildings [Member] | Amazon.com Services, Inc [Member] | ||||||||||||
Purchase of industrial building | ft² | 300,000 | |||||||||||
Area of property | a | 123 | |||||||||||
Percentage of building area leased | 100.00% | |||||||||||
Lease term | 10 years | |||||||||||
Lease term expiration period | Oct. 31, 2027 | |||||||||||
Purchase price of industrial building | $ 30,250,000 | |||||||||||
Mortgage loan amortization period | 18 years | |||||||||||
Face amount of mortgages | $ 19,600,000 | |||||||||||
Mortgage loans on real estate, interest rate | 3.64% | |||||||||||
Annual rental income over the remaining term of lease | $ 1,884,000 | |||||||||||
Mortgage loan period | 10 years | |||||||||||
Industrial Buildings [Member] | Shaw Industries, Inc [Member] | ||||||||||||
Purchase of industrial building | ft² | 831,764 | |||||||||||
Area of property | a | 62.4 | |||||||||||
Percentage of building area leased | 100.00% | |||||||||||
Lease term | 10 years | |||||||||||
Lease term expiration period | Sep. 30, 2027 | |||||||||||
Purchase price of industrial building | $ 57,483,636 | |||||||||||
Mortgage loan amortization period | 14 years | |||||||||||
Face amount of mortgages | $ 33,300,000 | |||||||||||
Mortgage loans on real estate, interest rate | 3.53% | |||||||||||
Annual rental income over the remaining term of lease | $ 3,551,000 | |||||||||||
Industrial Buildings [Member] | B. Braun Medical Inc. [Member] | ||||||||||||
Purchase of industrial building | ft² | 399,440 | |||||||||||
Area of property | a | 27.5 | |||||||||||
Percentage of building area leased | 100.00% | |||||||||||
Lease term | 10 years | |||||||||||
Lease term expiration period | Apr. 1, 2028 | |||||||||||
Purchase price of industrial building | $ 30,750,540 | |||||||||||
Mortgage loan amortization period | 15 years | |||||||||||
Face amount of mortgages | $ 19,500,000 | |||||||||||
Mortgage loans on real estate, interest rate | 4.25% | |||||||||||
Annual rental income over the remaining term of lease | $ 2,128,000 | |||||||||||
Industrial Buildings [Member] | White Bear Lake, MN [Member] | ||||||||||||
Area of property | a | 4.78 | |||||||||||
Proceeds from sale of property | $ 4,126,000 | |||||||||||
Sale of industrial building | ft² | 59,425 |
Real Estate Investments - Sched
Real Estate Investments - Schedule of Properties Acquired During Period Accounted for Asset Acquisitions (Details) | 6 Months Ended |
Mar. 31, 2018USD ($) | |
Land [Member] | |
Purchase price allocation of properties acquired | $ 10,662,511 |
Buildings [Member] | |
Purchase price allocation of properties acquired | 96,729,583 |
In-Place Leases [Member] | |
Purchase price allocation of properties acquired | $ 2,653,738 |
Real Estate Investments - Summa
Real Estate Investments - Summary of Consolidated Statements of Income for Properties Acquired (Details) - USD ($) | 3 Months Ended | 6 Months Ended |
Mar. 31, 2018 | Mar. 31, 2018 | |
Real Estate [Abstract] | ||
Rental Revenue | $ 1,493,699 | $ 1,866,996 |
Net Income Attributable to Common Shareholders | $ 450,211 | $ 632,508 |
Real Estate Investments - Sum31
Real Estate Investments - Summary of Income or Operation Statements (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | |
Lease Termination Income | $ 0 | $ 0 | $ 210,261 | $ 0 |
Real Estate Held for Sale [Member] | ||||
Rental and Reimbursement Revenue | 277,509 | 534,600 | 857,271 | 1,101,506 |
Lease Termination Income | 0 | 0 | 210,261 | 0 |
Real Estate Taxes | (16,894) | (85,826) | (227,604) | (179,992) |
Operating Expenses | (36,276) | (33,036) | (84,611) | (97,862) |
Depreciation & Amortization | (4,868) | (130,554) | (63,410) | (267,445) |
Interest Expense, including Amortization of Financing Costs | (11,962) | (60,434) | (26,563) | (112,982) |
Income from Operations | 207,509 | 224,750 | 665,344 | 443,225 |
Gain (Loss) on Sale of Real Estate Investment | 0 | 0 | 5,387,886 | (95,336) |
Net Income | $ 207,509 | $ 224,750 | $ 6,053,230 | $ 347,889 |
Real Estate Investments - Sch32
Real Estate Investments - Schedule of Pro Forma Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | |
Real Estate [Abstract] | ||||
Rental Revenues | $ 29,029,200 | $ 29,117,700 | $ 58,132,100 | $ 58,556,100 |
Net Income Attributable to Common Shareholders | $ 7,116,800 | $ 4,631,100 | $ 14,844,300 | $ 11,082,000 |
Basic and Diluted Net Income per Share Attributable to Common Shareholders | $ 0.09 | $ 0.06 | $ 0.19 | $ 0.14 |
Securities Available for Sale33
Securities Available for Sale at Fair Value (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Sep. 30, 2017 | |
Schedule of Available-for-sale Securities [Line Items] | |||||
Securities available for sale at fair value | $ 144,630,426 | $ 144,630,426 | $ 123,764,770 | ||
Security available for sale, maximum percentage of investment on un depreciated assets | 10.00% | ||||
Total gross real estate investments | 1,748,202,329 | $ 1,748,202,329 | |||
Marketable REIT securities investments | $ 144,630,426 | ||||
Percentage of undepreciated assets | 8.30% | ||||
Proceeds from sales or redemptions of securities available for sale | $ 2,508,046 | ||||
Gain on sale of securities available for sale | 11,234 | $ 0 | 111,387 | $ 806,108 | |
Dividend income on investment in securities | 2,885,821 | 5,748,465 | |||
Purchase of securities available for sale | 61,068,920 | $ 29,305,625 | |||
Net unrealized gains on securities portfolio | (31,124,653) | (31,124,653) | $ 6,570,565 | ||
UMH Properties, Inc [Member] | Series B Cumulative Redeemable Preferred Stock [Member] | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Securities available for sale at fair value | 2,655,000 | 2,655,000 | |||
Shares owned, cost | $ 2,500,000 | $ 2,500,000 | |||
Available for sale securities, shares | 100,000 | 100,000 | |||
Dividend rate of preferred stock held as security for loan | 8.00% | ||||
UMH Properties, Inc [Member] | Common and Preferred Stock [Member] | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Net unrealized gains on securities portfolio | $ 4,061,363 | $ 4,061,363 | |||
UMH Properties, Inc [Member] | Common Stock [Member] | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Securities available for sale at fair value | $ 15,546,972 | $ 15,546,972 | |||
UMH common shares purchased during the quarter | 31,041 | 31,041 | |||
Cost of securities purchased | $ 408,759 | $ 408,759 | |||
Dividend reinvestment and stock purchase plan cost, per share | $ 13.17 | $ 13.17 | |||
Shares owned by company | 1,159,357 | 1,159,357 | |||
Shares owned, cost | $ 11,640,610 | $ 11,640,610 |
Securities Available for Sale34
Securities Available for Sale at Fair Value - Schedule of Temporary Impaired Securities (Details) | 6 Months Ended |
Mar. 31, 2018USD ($) | |
Less than 12 Months, Fair Value | $ 125,062,452 |
Less than 12 Months, Unrealized Losses | (35,354,549) |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Unrealized Losses | 0 |
Preferred Stock [Member] | |
Less than 12 Months, Fair Value | 3,568,452 |
Less than 12 Months, Unrealized Losses | (1,375,222) |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Unrealized Losses | 0 |
Common Stock [Member] | |
Less than 12 Months, Fair Value | 121,494,000 |
Less than 12 Months, Unrealized Losses | (33,979,327) |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Unrealized Losses | $ 0 |
Securities Available for Sale35
Securities Available for Sale at Fair Value - Summary of Range of Losses (Details) | 6 Months Ended |
Mar. 31, 2018USD ($)Security | |
Number of Individual Securities | Security | 12 |
Fair Value | $ 125,062,452 |
Unrealized Losses | $ (35,354,549) |
Securities One [Member] | |
Number of Individual Securities | Security | 3 |
Fair Value | $ 4,096,452 |
Unrealized Losses | $ (149,520) |
Range of Loss | 1%-5% |
Securities Two [Member] | |
Number of Individual Securities | Security | 3 |
Fair Value | $ 35,565,000 |
Unrealized Losses | $ (3,711,739) |
Range of Loss | 6%-10% |
Securities Three [Member] | |
Number of Individual Securities | Security | 3 |
Fair Value | $ 47,527,000 |
Unrealized Losses | $ (8,368,816) |
Range of Loss | 11%-20% |
Securities Four [Member] | |
Number of Individual Securities | Security | 3 |
Fair Value | $ 37,874,000 |
Unrealized Losses | $ (23,124,474) |
Range of Loss | 21%-50% |
Debt (Details Narrative)
Debt (Details Narrative) | Apr. 06, 2018USD ($)ft²a | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Sep. 30, 2017USD ($) |
Amortization of financing costs | $ 302,556 | $ 384,984 | $ 596,450 | $ 665,897 | ||
Weighted average interest rate percentage | 4.11% | 4.37% | 4.18% | |||
Notes payable maturity period | 11 years 6 months | 10 years 8 months 12 days | 11 years 7 months 6 days | |||
Proceeds from fixed rate mortgage notes payable | $ 67,100,000 | $ 38,000,000 | ||||
Repayment of mortgage payable | 6,160,000 | |||||
Drawn down margin loan | $ 44,341,511 | $ 44,341,511 | ||||
Maximum borrowing percentage of marketable securities | 50.00% | 50.00% | ||||
Securities available for sale at fair value | $ 144,630,426 | $ 144,630,426 | $ 123,764,770 | |||
Margin loan bearing interest rate | 2.00% | 2.00% | ||||
Line of Credit [Member] | ||||||
Total availability of unsecured credit facility | $ 200,000,000 | $ 200,000,000 | ||||
Line of credit amount | 110,000,000 | $ 110,000,000 | ||||
Debt maturity date | Sep. 30, 2020 | |||||
Line of credit facility interest rate terms | Availability under the Facility is limited to 60% of the value of the borrowing base properties. The value of the borrowing base properties is determined by applying a capitalization rate to the NOI generated by our unencumbered, wholly-owned industrial properties. Effective, March 22, 2018, the capitalization rate applied to our NOI generated by our unencumbered, wholly-owned industrial properties was lowered from 7.0% to 6.5%. Borrowings under the Facility, will, at our election, either i) bear interest at LIBOR plus 140 basis points to 220 basis points, depending on our leverage ratio, or ii) bear interest at BMOs prime lending rate plus 40 basis points to 120 basis points, depending on our leverage ratio. Our borrowings as of March 31, 2018, based on our leverage ratio, bear interest at LIBOR plus 170 basis points, which represented an interest rate of 3.58%. | |||||
Line of credit facility related to accordion feature | $ 100,000,000 | $ 100,000,000 | ||||
Total potential available under unsecured line of credit | $ 300,000,000 | |||||
One Mortgages Loans [Member] | ||||||
Mortgage loan amortization period | 15 years | |||||
Mortgages Loans [Member] | ||||||
Mortgage loan amortization period | 10 years | |||||
Mortgage loan amortizing over period | 18 years | |||||
Two Mortgages Loans [Member] | ||||||
Mortgage loan amortizing over period | 14 years | |||||
Three Mortgages Loans [Member] | ||||||
Weighted average interest rate percentage | 3.71% | |||||
Notes payable maturity period | 13 years | |||||
Proceeds from fixed rate mortgage notes payable | $ 67,100,000 | |||||
Industrial Buildings [Member] | B. Braun Medical Inc. [Member] | ||||||
Mortgage loan amortization period | 15 years | |||||
Purchase of industrial building | ft² | 399,440 | |||||
Area of property | a | 27.5 | |||||
Percentage of building area leased | 100.00% | |||||
Lease term | 10 years | |||||
Lease term expiration period | Apr. 1, 2028 | |||||
Purchase price of industrial building | $ 30,750,540 | |||||
Face amount of mortgages | $ 19,500,000 | |||||
Mortgage loans on real estate, interest rate | 4.25% | |||||
Annual rental income over the remaining term of lease | $ 2,128,000 | |||||
Minimum [Member] | ||||||
Annual interest rate | 3.45% | |||||
Maximum [Member] | ||||||
Annual interest rate | 7.60% |
Debt - Schedule of Fixed Rate M
Debt - Schedule of Fixed Rate Mortgage Notes Payable (Details) - USD ($) | Mar. 31, 2018 | Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |||
Fixed Rate Mortgage Notes Payable | $ 639,836,890 | $ 598,962,567 | |
Debt Issuance Costs | 10,987,585 | 10,597,083 | |
Accumulated Amortization of Debt Issuance Costs | (3,201,928) | (2,998,887) | |
Unamortized Debt Issuance Costs | 7,785,657 | 7,598,196 | |
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs | $ 632,051,233 | $ 591,364,371 | |
Weighted Average Interest Rate | [1] | 4.11% | 4.18% |
[1] | Weighted average interest rate excludes amortization of debt issuance costs. |
Shareholders' Equity (Details N
Shareholders' Equity (Details Narrative) - USD ($) | Oct. 02, 2017 | Jun. 29, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Jan. 16, 2018 | Sep. 30, 2017 |
Subsidiary or Equity Method Investee [Line Items] | ||||||
Common stock, shares authorized | 192,039,750 | 192,039,750 | ||||
Common stock, shares issued | 78,846,177 | 75,630,521 | ||||
Common stock, shares outstanding | 78,846,177 | 75,630,521 | ||||
Excess stock, shares authorized | 200,000,000 | 200,000,000 | ||||
Excess Stock, par value | $ 0.01 | $ 0.01 | ||||
Excess Stock , shares issued | ||||||
Excess Stock , shares outstanding | ||||||
Amount of dividend reinvested | $ 6,045,930 | $ 4,536,751 | ||||
Board of Directors [Member] | April 2, 2018 [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Dividend declared per share | $ 0.17 | |||||
Dividend Reinvestment and Stock Purchase Plan [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Common stock issued under plan | 3,161,320 | |||||
Preferred Stock ATM Program [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | |||||
Preferred stock redemption price | $ 25 | |||||
Maximum proceeds from issuance of sale of equity | $ 100,000,000 | |||||
Number of preferred stock shares sold | 1,255,931 | |||||
Weighted average exercise price per share | $ 25.09 | |||||
Net proceeds from offering | $ 30,942,000 | |||||
Maximum [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Share Repurchase Program authorizes amount | $ 10,000,000 | |||||
Common Stock [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Percentage increase in common stock dividend | 6.25% | |||||
Dividend declared per share | $ 0.17 | |||||
Common stock dividend, description | Board of Directors approved a 6.25% increase in our quarterly common stock dividend, raising it to $0.17 per share from $0.16 per share, representing our second dividend increase in three years. | |||||
Increase in dividend period | 3 years | |||||
Dividend increase percentage | 13.00% | |||||
Annualized dividend rate per share price | $ 0.68 | |||||
Period of maintained or increased its cash dividend | 26 years | |||||
Cash raised from issuance of common stock under DRIP | $ 49,042,921 | |||||
Amount of dividend reinvested | 6,045,930 | |||||
Cash dividends paid | $ 26,319,599 | |||||
Common Stock [Member] | Maximum [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Dividend declared per share | $ 0.17 | |||||
Common Stock [Member] | Minimum [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Dividend declared per share | $ 0.16 | |||||
Series C Preferred Stock [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Preferred stock, shares authorized | 12,400,000 | 12,400,000 | ||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | 6.125% | ||||
Preferred stock, par value | $ 0.01 | $ 0.01 | ||||
Preferred stock, shares issued | 11,095,376 | 9,839,445 | ||||
Preferred stock, shares outstanding | 11,095,376 | 9,839,445 | ||||
Series C Preferred Stock [Member] | Board of Directors [Member] | April 2, 2018 [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | |||||
Dividend declared per share | $ 0.3828125 | |||||
Series C Cumulative Redeemable Preferred Stock [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | |||||
Preferred stock, shares issued | 11,095,376 | |||||
Preferred stock, shares outstanding | 11,095,376 | |||||
Dividend declared per share | $ 0.765625 | |||||
Cash dividends paid | $ 8,301,342 | |||||
Accrued dividend | $ 1,415,816 | |||||
Annual rate of dividends cumulative and payable | $ 1.53125 | |||||
Preferred stock redemption price | $ 25 |
Fair Value Measurements (Detail
Fair Value Measurements (Details Narrative) - USD ($) | Mar. 31, 2018 | Sep. 30, 2017 |
Fixed rate mortgage notes payable, net of unamortized debt issuance costs | $ 632,051,233 | $ 591,364,371 |
Mortgage Notes Payable Fair Value [Member] | ||
Fixed rate mortgage notes payable at fair value | 643,629,000 | |
Fixed rate mortgage notes payable, net of unamortized debt issuance costs | $ 639,836,890 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Fair Value of Financial Assets (Details) - USD ($) | Mar. 31, 2018 | Sep. 30, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | $ 144,630,426 | $ 123,764,770 |
Fair Value Measurements [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 144,630,426 | 123,764,770 |
Fair Value Measurements [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Preferred Stock [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 7,585,530 | 11,818,628 |
Fair Value Measurements [Member] | Preferred Stock [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 7,585,530 | 11,818,628 |
Fair Value Measurements [Member] | Preferred Stock [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Preferred Stock [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Common Stock [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 137,040,972 | 111,941,806 |
Fair Value Measurements [Member] | Common Stock [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 137,040,972 | 111,941,806 |
Fair Value Measurements [Member] | Common Stock [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Common Stock [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 3,924 | 4,336 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 3,924 | 4,336 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | $ 0 | $ 0 |
Supplemental Cash Flow Inform41
Supplemental Cash Flow Information (Details Narrative) - USD ($) | 6 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Supplemental Cash Flow Elements [Abstract] | ||
Cash paid for interest | $ 15,054,000 | $ 12,108,000 |
Amount of dividend reinvested | $ 6,045,930 | $ 4,536,751 |
Contingencies and Commitments (
Contingencies and Commitments (Details Narrative) | 6 Months Ended |
Mar. 31, 2018USD ($)ft² | |
Contingencies and Commitments [Line Items] | |
Expected gain loss on sale of properties | $ 5,388,000 |
FedEx Ground Package System, Inc [Member] | |
Contingencies and Commitments [Line Items] | |
Expansion costs | 1,834,000 |
Increase in annualized rent | $ 183,000 |
Lease extension term from the date of completion | 10 years |
FedEx Ground Package System, Inc [Member] | Minimum [Member] | |
Contingencies and Commitments [Line Items] | |
Increase in annualized rent | $ 1,415,000 |
FedEx Ground Package System, Inc [Member] | Maximum [Member] | |
Contingencies and Commitments [Line Items] | |
Increase in annualized rent | $ 1,598,000 |
Industrial Building [Member] | |
Contingencies and Commitments [Line Items] | |
Mortgage loans amortization period | 15 years |
Mortgage loans committed on real estate, carrying amount of mortgage | $ 29,860,000 |
Fixed interest rate, percentage | 3.82% |
Properties One [Member] | |
Contingencies and Commitments [Line Items] | |
Area of buildings | ft² | 87,500 |
Expected proceeds from sale of buildings | $ 6,400,000 |
Expected gain loss on sale of properties | $ 2,400,000 |
Properties Two [Member] | |
Contingencies and Commitments [Line Items] | |
Area of buildings | ft² | 68,370 |
Expected proceeds from sale of buildings | $ 5,800,000 |
Property Purchase Agreement [Member] | Industrial Building [Member] | |
Contingencies and Commitments [Line Items] | |
Area of buildings | ft² | 624,000 |
Weighted average lease maturity term | 12 years 3 months 19 days |
Aggregate purchase price of industrial properties | $ 80,863,000 |
Property Purchase Agreement [Member] | Amazon Fulfillment Services, Inc [Member] | |
Contingencies and Commitments [Line Items] | |
Area of buildings | ft² | 363,000 |
Property Purchase Agreement [Member] | FedEx Ground Package System, Inc [Member] | |
Contingencies and Commitments [Line Items] | |
Area of buildings | ft² | 261,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] | Apr. 06, 2018USD ($)ft²a | Apr. 02, 2018$ / shares |
B. Braun Medical Inc. [Member] | Industrial Building [Member] | ||
Subsequent Event [Line Items] | ||
Purchase of industrial building | ft² | 399,440 | |
Area of property | a | 27.5 | |
Percentage of building area leased | 100.00% | |
Lease term | 10 years | |
Lease term expiration period | Apr. 1, 2028 | |
Purchase price of industrial building | $ 30,750,540 | |
Mortgage loan amortization period | 15 years | |
Face amount of mortgages | $ 19,500,000 | |
Mortgage loans on real estate, interest rate | 4.25% | |
Annual rental income over the remaining term of lease | $ 2,128,000 | |
Common Shareholders [Member ] | ||
Subsequent Event [Line Items] | ||
Dividend declared per share | $ / shares | $ 0.17 | |
Dividend declaration date | Apr. 2, 2018 | |
Dividends payable, date to be paid | Jun. 15, 2018 | |
Dividend payable date of record | May 15, 2018 | |
Series C Preferred Shareholders [Member] | ||
Subsequent Event [Line Items] | ||
Dividend declared per share | $ / shares | $ 0.3828125 | |
Dividend declaration date | Apr. 2, 2018 | |
Dividends payable, date to be paid | Jun. 15, 2018 | |
Dividend payable date of record | May 15, 2018 | |
Preferred stock dividend rate, percentage | 6.125% |