~~(Former~~(Former name, former address and former fiscal year, if changed since last report.)

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

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

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ~~Yes[~~Yes [ ] No [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ~~[ ]~~ No [X]

Number of shares outstanding of the issuer’s common stock, $0.01 par value per share, as of ~~August~~February 1, ~~2017: 74,338,101~~2018: 77,692,113

	June 30, 2017			September 30, 2016			December 31, 2017			September 30, 2017
	(Unaudited)						(Unaudited)
ASSETS

Real Estate Investments:
Land	$	184,998,116		$	165,375,315		$	193,562,859		$	187,224,819
Buildings and Improvements		1,188,576,632			1,005,938,180			1,290,476,339			1,244,691,715
Total Real Estate Investments		1,373,574,748			1,171,313,495			1,484,039,198			1,431,916,534
Accumulated Depreciation		(169,226,861	)		(148,830,169	)		(179,492,182	)		(171,060,478	)
Real Estate Investments		1,204,347,887			1,022,483,326			1,304,547,016			1,260,856,056

Real Estate Held for Sale								9,481,407			14,606,028
Cash and Cash Equivalents		11,749,997			95,749,508			10,755,901			10,226,046
Securities Available for Sale at Fair Value		100,495,810			73,604,894			130,431,475			123,764,770
Tenant and Other Receivables		1,148,114			1,444,824			5,385,744			1,753,054
Deferred Rent Receivable		7,739,322			6,917,431			8,391,569			8,049,275
Prepaid Expenses		7,358,734			4,830,987			9,125,236			5,434,874
Capitalized Lease Costs, net of Accumulated Amortization of $3,727,227 and $3,238,516, respectively		4,137,743			4,165,268
Intangible Assets, net of Accumulated Amortization of $13,103,744 and $12,332,599, respectively		8,608,879			5,816,153
Financing Costs, net of Accumulated Amortization of $525,660 and $246,678, respectively		969,603			1,245,923
Intangible Assets, net of Accumulated Amortization of $13,554,423 and $13,404,318, respectively								10,811,664			10,010,165
Capitalized Lease Costs, net of Accumulated Amortization of $3,114,088 and $3,393,187, respectively								4,161,907			4,180,907
Financing Costs, net of Accumulated Amortization of $713,450 and $619,555, respectively								781,813			875,709
Other Assets		5,061,923			7,227,571			5,251,185			3,280,871

TOTAL ASSETS	$	1,351,618,012		$	1,223,485,885		$	1,499,124,917		$	1,443,037,755

					December 31, 2017			September 30, 2017
	June 30, 2017		September 30, 2016		(Unaudited)
	(Unaudited)
LIABILITIES AND SHAREHOLDERS’ EQUITY

Liabilities:
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs	$	554,486,956	$	477,476,010	$	612,651,435		$	591,364,371
Loans Payable		122,094,940		80,790,684		110,000,000			120,091,417
Accounts Payable and Accrued Expenses		2,853,438		3,998,771		3,587,862			4,450,753
Other Liabilities		13,936,503		9,868,572		18,801,819			14,265,518
Preferred Stock Called for Redemption		-0-		53,493,750
Total Liabilities		693,371,837		625,627,787		745,041,116			730,172,059

COMMITMENTS AND CONTINGENCIES

Shareholders’ Equity:
7.875% Series B Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: -0- and 2,300,000 Shares Authorized, Issued and Outstanding as of June 30, 2017 and September 30, 2016, respectively		-0-		57,500,000
6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: 12,400,000 and 5,400,000 Shares Authorized as of June 30, 2017 and September 30, 2016, respectively; 8,400,000 and 5,400,000 Shares Issued and Outstanding as of June 30, 2017 and September 30, 2016, respectively		210,000,000		135,000,000
Common Stock, $0.01 Par Value Per Share: 192,039,750 and 194,600,000 Shares Authorized as of June 30, 2017 and September 30, 2016, respectively; 73,824,161 and 68,920,972 Shares Issued and Outstanding as of June 30, 2017 and September 30, 2016, respectively		738,242		689,210
Excess Stock, $0.01 Par Value Per Share: 200,000,000 Shares Authorized as of June 30, 2017 and September 30, 2016; No Shares Issued or Outstanding as of June 30, 2017 and September 30, 2016		-0-		-0-
6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: 12,400,000 Shares Authorized as of December 31, 2017 and September 30, 2017; 10,879,379 and 9,839,445 Shares Issued and Outstanding as of December 31, 2017 and September 30, 2017, respectively						271,984,475			245,986,125
Common Stock, $0.01 Par Value Per Share: 192,039,750 Shares Authorized as of December 31, 2017 and September 30, 2017; 77,209,110 and 75,630,521 Shares Issued and Outstanding as of December 31, 2017 and September 30, 2017, respectively						772,091			756,305
Excess Stock, $0.01 Par Value Per Share: 200,000,000 Shares Authorized as of December 31, 2017 and September 30, 2017; No Shares Issued or Outstanding as of December 31, 2017 and September 30, 2017						-0-			-0-
Additional Paid-In Capital		438,742,799		391,726,621		485,469,807			459,552,701
Accumulated Other Comprehensive Income		8,765,134		12,942,267
Accumulated Other Comprehensive Income (Loss)						(4,142,572	)		6,570,565
Undistributed Income		-0-		-0-		-0-			-0-
Total Shareholders’ Equity		658,246,175		597,858,098		754,083,801			712,865,696

TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY	$	1,351,618,012	$	1,223,485,885	$	1,499,124,917		$	1,443,037,755

FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~JUNE 30,~~DECEMBER 31, 2017 AND 2016 - CONTINUED

	Three Months Ended						Nine Months Ended						Three Months Ended
	6/30/2017			6/30/2016			6/30/2017			6/30/2016			12/31/2017			12/31/2016

Net Income	$	11,730,363		$	8,231,295		$	30,008,895		$	22,301,897		$	17,630,401		$	9,853,921
Other Comprehensive Income:
Unrealized Holding Gains (Losses) Arising During the Period		(2,117,319	)		10,100,681			(1,883,189	)		18,489,989			(10,612,984	)		(1,941,041	)
Reclassification Adjustment for Net Gains Realized in Income		(1,487,836	)		(272,067	)		(2,293,944	)		(1,159,409	)		(100,153	)		(806,108	)
TOTAL COMPREHENSIVE INCOME		8,125,208			18,059,909			25,831,762			39,632,477			6,917,264			7,106,772
Less: Preferred Dividends		4,045,787			2,151,758			11,325,583			6,455,274			4,316,946			3,697,760
Less: Redemption of Preferred Stock		2,467,165			-0-			2,467,165			-0-
COMPREHENSIVE INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS	$	1,612,256		$	15,908,151		$	12,039,014		$	33,177,203		$	2,600,318		$	3,409,012

	Nine Months Ended						Three Months Ended
	6/30/2017			6/30/2016			12/31/2017			12/31/2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income	$	30,008,895		$	22,301,897		$	17,630,401		$	9,853,921
Noncash Items Included in Net Income:
Depreciation & Amortization		23,726,676			19,610,250			9,315,949			7,721,205
Deferred Straight Line Rent								(396,028	)		(343,239	)
Stock Compensation Expense		441,054			306,688			130,763			100,155
Gain on Sale of Securities Transactions		(2,293,944	)		(1,159,409	)		(100,153	)		(806,108	)
Loss on Sale of Real Estate Investment		95,336			-0-
(Gain) / Loss on Sale of Real Estate Investments								(5,387,886	)		95,336
Changes In:
Tenant, Deferred Rent and Other Receivables		12,479			(1,235,976	)
Tenant & Other Receivables								(3,607,013	)		(255,461	)
Prepaid Expenses		(2,527,747	)		(1,859,791	)		(3,690,362	)		(2,645,032	)
Other Assets and Capitalized Lease Costs		71,446			(2,293,188	)
Accounts Payable, Accrued Expenses and Other Liabilities		656,824			7,676,175
Other Assets & Capitalized Lease Costs								(89,641	)		(428,282	)
Accounts Payable, Accrued Expenses & Other Liabilities								3,284,409			860,211
NET CASH PROVIDED BY OPERATING ACTIVITIES		50,191,019			43,346,646			17,090,439			14,152,706

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Real Estate and Intangible Assets		(208,390,539	)		(141,230,341	)
Purchase of Real Estate & Intangible Assets								(52,500,165	)		(56,101,538	)
Capital Improvements		(1,208,390	)		(19,517,185	)		(1,782,422	)		(696,941	)
Proceeds on Sale of Real Estate		4,125,819			-0-
Proceeds on Sales of Real Estate								10,499,704			4,125,819
Return of Deposits on Real Estate		2,700,000			1,650,000			450,000			1,000,000
Deposits Paid on Acquisitions of Real Estate		(1,280,000	)		(1,100,000	)		(1,350,000	)		(820,000	)
Proceeds from Sale of Securities Available for Sale		10,693,212			8,165,701			2,435,168			3,738,938
Purchase of Securities Available for Sale		(39,467,317	)		(17,772,994	)		(19,714,857	)		(6,396,581	)
NET CASH USED IN INVESTING ACTIVITIES		(232,827,215	)		(169,804,819	)		(61,962,572	)		(55,150,303	)

CASH FLOWS FROM FINANCING ACTIVITIES
Net Proceeds from Loans Payable		41,304,256			40,812,783
Net Repayments on Loans Payable								(10,091,417	)		(4,790,684	)
Proceeds from Fixed Rate Mortgage Notes Payable		137,925,000			92,971,000			33,800,000			38,000,000
Principal Payments on Fixed Rate Mortgage Notes Payable		(59,936,689	)		(26,609,348	)		(12,351,030	)		(9,456,016	)
Financing Costs Paid on Debt		(1,650,516	)		(1,204,207	)		(361,905	)		(636,963	)
Proceeds from the Exercise of Stock Options		-0-			1,412,050			284,800			-0-
Redemption of 7.625% Series A Preferred Stock		(53,493,750	)		-0-			-0-			(53,493,750	)
Redemption of 7.875% Series B Preferred Stock		(57,500,000	)		-0-
Proceeds from Underwritten Public Offering of 6.125% Series C Preferred Stock, net of offering costs		71,003,093			-0-
Proceeds from At-The-Market Preferred Equity Program, net of offering costs								25,687,516			-0-
Proceeds from Issuance of Common Stock in the DRIP, net of Dividend Reinvestments		59,111,167			45,132,315			22,611,458			18,877,487
Preferred Dividends Paid		(11,044,489	)		(6,455,274	)		(4,080,685	)		(3,422,136	)
Common Dividends Paid, net of Reinvestments		(27,081,387	)		(24,788,097	)		(10,096,749	)		(9,107,243	)
NET CASH PROVIDED BY FINANCING ACTIVITIES		98,636,685			121,271,222
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES								45,401,988			(24,029,305	)

NET DECREASE IN CASH AND CASH EQUIVALENTS		(83,999,511	)		(5,186,951	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS								529,855			(65,026,902	)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD		95,749,508			12,073,909			10,226,046			95,749,508
CASH AND CASH EQUIVALENTS - END OF PERIOD	$	11,749,997		$	6,886,958		$	10,755,901		$	30,722,606

Monmouth Real Estate Investment Corporation, a Maryland corporation, together with its consolidated subsidiaries (MREIC, the Company, or we), operates as a real estate investment trust (REIT) deriving its income primarily from real estate rental operations. As of ~~June 30,~~December 31, 2017, the Company owned ~~105~~108 properties with total square footage of approximately ~~17,917,000,~~19,096,000, which was ~~99.8%~~99.5% occupied, as compared to 99108 properties with total square footage of approximately ~~16,010,000,~~18,790,000, which was ~~99.6%~~99.3% occupied as of September 30, ~~2016.~~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 December 31, 2017, the Company’s weighted average lease maturity was approximately 7.9 years and its annualized average base rent per occupied square foot was $5.99. As of December 31, 2017, the weighted average building age, based on the square footage of the Company’s buildings, was 9.1 years. The Company also owns a portfolio of REIT investment securities, which the Company generally limits to no more than approximately 10% of its undepreciated assets (which is the Company’s total assets excluding accumulated depreciation). Total gross real estate investments, excluding marketable REIT securities investments of $130,431,475, were $1,484,039,198 as of December 31, 2017.

The Company has elected to be taxed as a REIT under Sections 856-860 of the Internal Revenue Code of 1986, as amended (the Code), and intends to maintain its qualification as a REIT in the future. As a qualified REIT, with limited exceptions, the Company will not be taxed under Federal and certain state income tax laws at the corporate level on taxable income that it distributes to its shareholders. For special tax provisions applicable to REITs, refer to Sections 856-860 of the Code. The Company is subject to franchise taxes in several of the states in which the Company owns property.

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 the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2017 are not necessarily indicative of the results that may be expected for the year ending September 30, ~~2017.~~2018. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in the Company’s annual report on Form 10-K for the fiscal year ended September 30, ~~2016.~~2017.

In preparing the financial statements in accordance with U.S. GAAP, management is 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.

Certain prior period amounts in the accompanying Consolidated Financial Statements have been reclassified to conform to the current period’s presentation.

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 by agreement with the Company.

Two leases that were set to expire during fiscal 2018 were leased to Kellogg Sales Company (Kellogg) at the Company’s 65,067 square foot facility located in Kansas City, MO through July 31, 2018 and at the Company’s 50,400 square foot facility located in Orangeburg, NY through February 28, 2018. Kellogg informed the Company that it will not be renewing its leases at these two properties. On December 18, 2017, the Company sold its property, located in Kansas City, MO for $4,900,000, with net sale proceeds to the Company of approximately $4,602,000 and on December 22, 2017, the Company sold its property, located in Orangeburg, NY for $6,170,000, with net sale proceeds to the Company 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 on a historic cost undepreciated basis of approximately $1,804,000, representing a 21% net gain over the Company’s historic cost basis. In conjunction with the sale of these two properties, the Company simultaneously entered into a lease termination agreement for each property whereby the Company 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.

Of the Company’s ~~105~~108 properties, only ~~four~~five locations have leases that contain an early termination provision. The Company’s leases with early termination provisions are the 26,340 square foot location in Ridgeland (Jackson), MS, the ~~38,333~~36,270 square feet location in Urbandale (Des Moines), IA, the 38,833 square foot location in Rockford, IL, the 83,000 square foot location in Roanoke, VA and the 102,135 square foot location in O’Fallon (St. Louis), MO. Each lease termination provision contains certain requirements that must be met in order to exercise each termination provision. These requirements ~~include;~~include: date termination can be exercised, the time frame that notice must be given by the tenant to the Company and the termination fee that would be required to be paid by the tenant to the Company. The total potential termination fee to be paid to the Company from the ~~four~~five leases with termination provisions amounts to approximately ~~$1,709,000.~~$1,756,000.

The Company’s original Stock Option and Stock Award Plan (the 2007 Plan) was initially adopted in 2007 upon approval by the Company’s shareholders on July 26, 2007. The 2007 Plan was amended and restated and approved by the Company’s shareholders on May 6, 2010. The 2007 Plan authorized the grant to officers and key employees of options to purchase up to 1,500,000 shares of common stock, $0.01 par value per share (common stock), including up to 100,000 shares of restricted stock awarded to any one participant in any one fiscal year. On March 13, 2017, upon recommendation of the Compensation Committee of the Board, the Board approved the Amended and Restated 2007 Incentive Award Plan (the Plan), conditioned upon shareholder approval. At the Company’s Annual Meeting held on May 18, 2017, the Company’s common shareholders approved the Plan and the Company subsequently filed a Registration Statement covering the offering and issuance of awards under the Plan with the Securities and Exchange Commission on July 11, 2017. The Plan constitutes an amendment and restatement of the 2007 Plan, extends the term of the 2007 Plan for an additional ten years, adds 1,600,000 shares of common stock to the share reserve, expands the types of awards available for grant under the Plan and makes other improvements to the 2007 Plan.

The Company accounts 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 the Company’s 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 ~~$174,709~~$130,763 and ~~$99,760~~$100,155 for the three months ended ~~June 30, 2017 and 2016, respectively, and amounted to $441,054 and $306,688 for the nine months ended June 30,~~December 31, 2017 and 2016, respectively.

During the ~~nine~~three months ended ~~June 30,~~December 31, 2017, ~~and~~no options were granted. During the three months ended December 31, 2016, the following stock options, which vest one year after grant date, were granted under the Company’s ~~2007~~ Plan:

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:

10	Fiscal 2017
Dividend yield		4.49	%
Expected volatility		18.88	%
Risk-free interest rate		2.26	%
Expected lives (years)		8
Estimated forfeitures		-0-

The weighted-average fair value of options granted during the ~~nine~~three months ended ~~June 30, 2017 and~~December 31, 2016 was ~~$1.49 and $0.74~~$1.45 per ~~option, respectively.~~option.

During the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016, no12,500 and -0- shares of restricted stock were ~~granted and during~~granted. During the ~~nine~~three months ended ~~June 30, 2016, one participant forfeited 3,232 shares of restricted stock under the 2007 Plan. During the nine months ended June 30, 2016, five~~December 31, 2017, two participants exercised options awarded under the ~~2007~~ Plan to purchase an aggregate of ~~180,000~~20,000 shares of common stock at a weighted average exercise price of ~~$7.84~~$14.24 per share for total proceeds of ~~$1,412,050.~~$284,800. During the ~~nine~~three months ended ~~June 30, 2017,~~December 31, 2016, no options were exercised. As of ~~June 30,~~December 31, 2017, a total of ~~1,764,878~~1,740,542 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, and there were outstanding options to purchase ~~735,000~~650,000 shares. The aggregate intrinsic value of options outstanding as of ~~June 30,~~December 31, 2017 was ~~$2,719,550.~~$3,981,900.

In ~~January 2017,~~February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business” (ASU 2017-01). ASU 2017-01 provides revised guidance to determine when an acquisition meets the definition of a business or should be accounted for as an asset acquisition, likely resulting in more acquisitions being accounted for as asset acquisitions as opposed to business combinations. Transaction costs are capitalized for asset acquisitions while they are expensed as incurred for business combinations. ASU 2017-01 requires that, when substantially all of the fair value of an acquisition is concentrated in a single identifiable asset or a group of similar identifiable assets, the asset or group of similar identifiable assets does not meet the definition of a business. ASU 2017-01 also revises the definition of a business to include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create an output. ASU 2017-01 will be effective, on a prospective basis, for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. We adopted ASU 2017-01 prospectively as of April 1, 2017, as permitted under the standard. As a result of the implementation of this update, our property acquisitions, which under previous guidance were accounted for as business combinations, are now accounted for as acquisitions of assets. In an acquisition of assets, certain acquisition costs are capitalized as opposed to expensed under accounting for business combinations. For the period April 1, 2017 through June 30, 2017, the Company acquired five properties, for each of which it was concluded that substantially all of the fair value of the assets acquired with each property acquisition was concentrated in a single identifiable asset and did not meet the definition of a business combination under ASU 2017-01. Therefore, acquisition transaction costs associated with these property acquisitions were capitalized to real estate investments as part of the purchase price.

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments”. ASU 2016-15 will make eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. ASU 2016-15 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.

In March 2016, the FASB issued ASU 2016-09 “Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting”, which relates to the accounting for employee share-based payments. ASU 2016-09 addresses several aspects of the accounting for share-based payment award transactions, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.

~~In February 2016, the FASB issued 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. The Company is ~~currently evaluating~~continuing to evaluate the potential impact this standard may have on the consolidated financial statements and the timing of adoption. The most significant changes for the Company related to lessor accounting under ASU 2016-02 include bifurcating its revenue into lease and non-lease components and the new standard’s narrow definition of initial direct costs for leases. Since the Company’s revenue is primarily derived from leasing activities from long-term net leases and since the Company currently does not capitalize indirect costs for leases, the Company believes it will continue to account for its leases and related leasing costs in substantially the same manner as it currently does 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 the Company’s fiscal year beginning October 1, 2018. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements and has not determined the effects of this update on the Company’s financial position, results of operations or cash flows and disclosures at this time.

~~In April 2015,~~ The Company anticipates that the ~~FASB issued~~most significant change for the Company, once ASU ~~2015-03, “Interest - Imputation of Interest (Topic 835): Simplifying~~2016-01 is adopted, will be the ~~Presentation of Debt Issuance Costs”. ASU 2015-03 requires debt issuance costs related to a recognized debt liability to be presented~~accounting for the Company’s investments in ~~the balance sheet~~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 ~~direct deduction from~~separate component of Shareholders’ Equity until realized and the ~~carrying amount of the debt liability. In August 2015, the FASB issued~~change in net unrealized holding gains and losses being reflected as comprehensive income (loss). Under ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements” (Subtopic 835-30), which clarified that debt issuance costs related to line-of-credit arrangements may be presented as an asset and amortized over the term of the line-of-credit arrangement regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company adopted2016-01, these standards effective October 1, 2016. As a result, debt issuance costs related to debt liabilities that are not line-of-credit arrangements are included as a direct deduction from the related debt liability and those related to line-of-credit arrangementsmarketable securities will continue to be ~~included as an asset on~~measured at fair value, however the ~~accompanying Consolidated Balance Sheets. The effects of this standard were applied retrospectively to all prior periods presented. The effect of the change~~changes in ~~accounting principle was the reduction in the amount of $6,272,143 of the Fixed Rate Mortgage Notes Payable liability~~net unrealized holding gains and a corresponding reduction of the Financing Costs asset as of September 30, 2016 and a reclassification of Amortization of Financing Costs of $240,463 and $713,501 for the three and nine months ended June 30, 2016, respectively to Interest Expense,losses will be recognized through net ~~of Amortization of Financing Costs in our Consolidated Statement of Income.~~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~~“Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical ~~Expedients,~~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, the Company expects to adopt the standard effective October 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method, and the Company is evaluating which transition method it will elect. The Company is also in the process of evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company’s revenue is primarily derived from leasing activities and historically the Company’s 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, the Company does not expect the adoption of this standard to have a significant impact on its consolidated financial statements and related disclosures.

Management does 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.

The Company’s primary business is the ownership and management of real estate properties. The Company ~~seeks to invest~~invests in well-located, modern, ~~single-tenant,~~single tenant, industrial buildings leased primarily to ~~investment grade~~investment-grade tenants or their subsidiaries on long-term net leases. The Company reviews operating and financial information for each property on an individual basis and, therefore, each property represents an individual operating segment. The Company evaluates financial performance using Net Operating Income (NOI) from property operations. NOI is ~~defined~~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. The Company has 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~~investment-grade tenants or their subsidiaries.

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 ~~171,719~~211,382 and ~~125,108~~143,640 shares are included in the diluted weighted-average shares outstanding for the three months ended ~~June 30, 2017 and 2016, respectively, and common stock equivalents of 157,858 and 89,250 shares are included in the diluted weighted-average shares outstanding for the nine months ended June 30,~~December 31, 2017 and 2016, respectively. For the diluted weighted-average shares outstanding for the three months ended ~~June 30,~~December 31, 2017 and 2016, ~~65,000~~-0- and ~~-0-~~215,000 options to purchase shares of common stock were antidilutive. ~~For the diluted weighted-average shares outstanding for the nine months ended June 30, 2017 and 2016, 65,000 and 65,000 options to purchase shares of common stock, respectively, were antidilutive.~~

On ~~October 17, 2016,~~November 2, 2017, the Company purchased a newly constructed ~~338,584~~121,683 square foot industrial building, situated on 16.2 acres, located in ~~Hamburg, NY, which is in the Buffalo Metropolitan Statistical Area (MSA).~~Charleston, SC. The building is 100% net-leased to FedEx ~~Ground Package System, Inc.~~Corporation (FDX) for 15 years through ~~March 2031.~~August 2032. The purchase price was ~~$35,100,000.~~$21,872,170. The Company obtained a 15 year fully-amortizing mortgage loan of ~~$23,500,000~~$14,200,000 at a fixed interest rate of ~~4.03%~~4.23%. Annual rental revenue over the remaining term of the lease averages approximately $2,309,000. In connection with the acquisition, the Company completed its evaluation of the acquired lease. As a result of its evaluation, the Company allocated $250,000 to an Intangible Asset associated with the lease in-place.$1,312,000.

On ~~December~~November 30, ~~2016,~~2017, the Company purchased a newly constructed ~~213,672~~300,000 square foot industrial building, situated on 123 acres, located in ~~Ft. Myers, FL.~~Oklahoma City, OK. The building is 100% net-leased to ~~FedEx Ground Package System,~~Amazon.com Services, Inc. for 10 years through ~~September 2026.~~October 2027. The purchase price was ~~$21,001,538.~~$30,250,000. The Company obtained a 1510 year ~~fully-amortizing~~ mortgage loan, amortizing over 18 years, of ~~$14,500,000~~$19,600,000 at a fixed interest rate of ~~3.97%~~3.64%. Annual rental revenue over the remaining term of the lease averages approximately $1,365,000. In connection with the acquisition, the Company completed its evaluation of the acquired lease. As a result of its evaluation, the Company allocated $201,538 to an Intangible Asset associated with the lease in-place.$1,884,000.

On April 5, 2017, the Company purchased a newly constructed 343,483 square foot industrial building located in Walker, MI, which is in the Grand Rapids MSA. The building is 100% net-leased to FedEx Ground Package System, Inc. for 15 years through January 2032. The purchase price was $32,120,000. The Company obtained a 15 year fully-amortizing mortgage loan of $20,875,000 at a fixed interest rate of 3.86%. Annual rental revenue over the remaining term of the lease averages approximately $2,102,000.

On June 23, 2017, the Company purchased a newly constructed 351,874 square foot industrial building located in Mesquite, TX, which is in the Dallas MSA. The building is 100% net-leased to FedEx Ground Package System, Inc. for 15 years through March 2032. The purchase price was $50,621,072. The Company obtained a 15 year fully-amortizing mortgage loan of $32,900,000 at a fixed interest rate of 3.60%. Annual rental revenue over the remaining term of the lease averages approximately $3,194,000.

On June 27, 2017, the Company purchased a newly constructed 315,560 square foot industrial building located in Aiken, SC, which is in the Augusta, GA MSA. The building is 100% net-leased to Autoneum North America, Inc. for 15 years through April 2032. The purchase price was $21,933,000. The Company obtained a 15 year fully-amortizing mortgage loan of $15,350,000 at a fixed interest rate of 4.20%. Annual rental revenue over the remaining term of the lease averages approximately $1,700,000.

On June 28, 2017, the Company purchased a newly-constructed 237,756 square foot industrial building located in Homestead, FL, which is in the Miami MSA. The building is 100% net leased to FedEx Ground Package System, Inc. for 15 years through March 2032. The purchase price was $38,347,933. The Company obtained a 15 year fully-amortizing mortgage loan of $24,800,000 at a fixed interest rate of 3.60%. Annual rental revenue over the remaining term of the lease averages approximately $2,282,000.

On June 29, 2017, the Company purchased a newly constructed 110,361 square foot industrial building located in Oklahoma City, OK. The building is 100% net-leased to Bunzl Distribution Oklahoma, Inc. for seven years through August 2024. The purchase price was $9,000,000. The Company obtained a 12 year fully-amortizing mortgage loan of $6,000,000 at a fixed interest rate of 4.125%. Annual rental revenue over the remaining term of the lease averages approximately $721,000.

The Company evaluated the property acquisitions which took place ~~subsequent to March~~during the three months ended December 31, 2017, ~~under the new framework for determining~~to determine whether an integrated set of assets and activities meets the definition of a business, pursuant to ASU ~~2017-01, which the Company early-adopted effective April 1, 2017.~~2017-01. Acquisitions that do not meet the definition of a business are accounted for as asset ~~acquisitions (see Note 1).~~acquisitions. Accordingly, the Company accounted for the properties purchased in ~~Walker (Grand Rapids), MI; Mesquite (Dallas), TX; Aiken (Augusta, GA), SC; Homestead (Miami), FL~~Charleston, SC and Oklahoma City, OK as asset acquisitions and allocated the total cash consideration, including transaction costs of approximately $378,000, 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 the Company’s ~~preliminary~~ purchase price allocation for these ~~five~~two properties acquired during the three months ended ~~June 30,~~December 31, 2017 that are accounted for as asset acquisitions:

Land	$	16,915,800	$	6,257,523
Building		132,260,865		45,108,625
In-Place Leases		3,112,332		1,134,017

The following table summarizes the operating results included in the Company’s consolidated statements of income for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2017 for the properties acquired during the ~~nine~~three months ended ~~June 30,~~December 31, 2017:

	Three Months Ended 6/30/2017		Nine Months Ended 6/30/2017		Three Months Ended 12/31/2017

Rental Revenues	$	1,712,249	$	3,234,951	$	373,297
Net Income Attributable to Common Shareholders		598,783		925,316		182,297

Subsequent to quarter end, on January 22, 2018, the Company 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. The Company 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 $3,470,000.

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. The references in this report to the SEC’s website are not intended to and do not include or incorporate by reference into this report the information on those websites.

On ~~October~~November 1, ~~2016,~~2017, a ~~50,625 square foot~~parking lot expansion ~~of the building~~for a property leased to FedEx Ground Package System, Inc., a subsidiary of FDX, located in ~~Edinburg, TX~~Indianapolis, IN was completed for a total project cost of approximately ~~$4,762,000,~~$1,683,000, resulting in a new 10 year lease which extended the prior lease expiration date from ~~September 2021 through September 2026.~~April 2024 to October 2027. In addition, the expansion resulted in an increase in annual rent effective from the date of completion of approximately ~~$499,000~~$184,000 from approximately ~~$598,000,~~$1,533,000, or ~~$5.27~~$4.67 per square foot, to approximately ~~$1,097,000,~~$1,717,000, or ~~$6.68~~$5.24 per square foot.

~~Disposition~~Two leases that were set to expire during fiscal 2018 were leased to 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 the Company that they will not be renewing their leases at these two properties. On December 18, 2017, the Company sold its property, located in Kansas City, MO for $4,900,000, with net sale proceeds to the Company of approximately $4,602,000 and on December 22, 2017, the Company sold its property, located in Orangeburg, NY for $6,170,000, with net sale proceeds to the Company 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 on a historic cost undepreciated basis of approximately $1,804,000, representing a 21% net gain over the Company’s historic cost basis. In conjunction with the sale of these two properties, the Company simultaneously entered into a lease termination agreement for each property whereby the Company 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.

OnReal Estate Held for Sale at December 31, 2017 consists of two properties that the Company has 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 an 68,370 square foot facility located in Colorado Springs, CO.

During the prior year quarter, on October 27, 2016, the Company sold its ~~only vacant building consisting of a~~ 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 ~~this property does~~the properties located in White Bear Lake, MN, Kansas City, MO and Orangeburg, NY and the future sale of the two properties classified as Real Estate Held for Sale do not represent a strategic shift that has ~~(or will have)~~ a major effect on the Company’s operations and financial results, the operations generated from ~~this property~~these properties are not included in Discontinued Operations.

The following table summarizes the operations ~~of this property prior to its sale on October 27, 2016 which is~~that are included in the accompanying Consolidated Statements of Income for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2017 and ~~2016:~~2016 for the two properties that were sold during the current quarter, prior to their sale, one property sold during the prior year quarter, prior to its sale, and for the two properties that are classified as Real Estate Held for Sale in the accompanying Consolidated Balance Sheets.

	Three Months Ended					Nine Months Ended						Three Months Ended
	6/30/2017		6/30/2016			6/30/2017			6/30/2016			12/31/2017			12/31/2016
Rental and Reimbursement Revenue	$	-0-	$	-0-		$	-0-		$	-0-		$	579,762		$	566,906
Lease Termination Income													210,260			-0-
Real Estate Taxes		-0-		(28,159	)		(8,855	)		(68,776	)		(210,710	)		(94,166	)
Operating Expenses		-0-		(32,022	)		(9,846	)		(52,363	)		(48,335	)		(64,826	)
Depreciation & Amortization		-0-		(24,017	)		(8,006	)		(73,055	)		(58,542	)		(136,891	)
Interest Expense		-0-		-0-			-0-			-0-
Loss from Operations		-0-		(84,198	)		(26,707	)		(194,194	)
Loss on Sale of Real Estate Investment		-0-		-0-			(95,336	)		-0-
Net Loss	$	-0-	$	(84,198	)	$	(122,043	)	$	(194,194	)
Interest Expense, including Amortization of Financing Costs													(14,601	)		(52,548	)
Income from Operations													457,834			218,475
Gain (Loss) on Sale of Real Estate Investments													5,387,886			(95,336	)
Net Income												$	5,845,720		$	123,139

The following unaudited pro forma condensed financial information has been prepared utilizing the historical financial statements of the Company and the effect of additional revenue and expenses generated from property acquired and expanded during fiscal ~~2017~~2018 to date, and during fiscal ~~2016,~~2017, assuming that the acquisitions and completed expansions had occurred as of October 1, ~~2015,~~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. ~~As further described in Note 6,~~In addition, the net proceeds raised from the issuance of the 6.125% Series C Cumulative Redeemable Preferred Stock less the redemptions of the Company’s 7.625% Series A Cumulative Redeemable Preferred Stock redeemed on October 14, 2016 and the Company’s 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, ~~2015.~~2016. In addition, Net Income Attributable to Common Shareholders excludes the ~~operating expenses incurred~~operations of the properties sold during fiscal 2018 and 2017 ~~and 2016 for~~which were the vacant property located in White Bear Lake, MN that was sold on October 27, ~~2016.~~2016, the property located in Kansas City, MO that was sold on December 18, 2017 and the property located in Orangeburg, NY that was sold on December 22, 2017 and 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, ~~2015.~~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.

The Company has a concentration of ~~FedEx Corporation (FDX)~~FDX and FDX subsidiary-leased properties, consisting of 5859 separate stand-alone leases covering approximately ~~9,124,000~~9,513,000 square feet as of ~~June 30,~~December 31, 2017 and 5155 separate stand-alone leases covering approximately ~~6,944,000~~8,187,000 square feet as of ~~June 30,~~December 31, 2016. The 5859 separate stand-alone leases that are leased to FDX and FDX subsidiaries have a weighted average lease maturity of ~~8.4~~8.7 years. The percentage of FDX and its subsidiaries leased square footage to the total of the Company’s rental space was ~~51%~~50% (8% to FDX and 42% to FDX subsidiaries) as of December 31, 2017 and 49% (6% to FDX and 43% to FDX subsidiaries) as of ~~June 30, 2017 and 46% (6% to FDX and 40% to FDX subsidiaries) as of June 30,~~December 31, 2016. As of ~~June 30,~~December 31, 2017, the only tenants that leased 5% or more of the Company’s total square footage were FDX and its subsidiaries and Milwaukee Electric Tool Corporation, which leases one property through July 2028 consisting of approximately 862,000 square feet, which was approximately 5% of the Company’s rental space. As of ~~June 30, 2016,~~December 31, 2017, no other ~~tenant,~~tenants, other than FDX and its subsidiaries and Milwaukee Electric Tool Corporation, accounted for 5% or more of the Company’s 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 ~~2017~~2018 and was ~~56% (7%~~59% (6% to FDX and ~~49%~~53% to FDX subsidiaries) of total Rental and Reimbursement Revenue for fiscal ~~2016.~~2017. No other tenant, other than FDX and its subsidiaries, accounted for 5% or more of the Company’s total Rental and Reimbursement Revenue for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016.

FDX is a publicly-owned company and financial information related to this entity is available at the SEC’s website,~~www.sec.gov~~www.sec.gov.. FDX is rated “BBB” by S&P Global Ratings (www.standardandpoors.com) and is rated “Baa2” by Moody’s (www.moodys.com), which are both considered “Investment Grade” ratings. The references in this report to the SEC’s website, S&P Global Ratings’ website and Moody’s website are not intended to and do not include or incorporate by reference into this report the information of FDX, S&P Global Ratings or Moody’s on such websites.

In addition to real estate property holdings, the Company held ~~$100,495,810~~$130,431,475 in marketable REIT securities at ~~June 30,~~December 31, 2017, representing ~~6.6%~~7.8% of the Company’s undepreciated assets (which is the Company’s total assets excluding accumulated depreciation). These liquid real estate holdings are not included in calculating the tenant concentration ratios above and therefore further enhance the Company’s diversification. The securities portfolio provides the Company with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available.

The Company’s Securities Available for Sale at Fair Value consists primarily of marketable common and preferred stock of other REITs with a fair value of ~~$100,495,810~~$130,431,475 as of ~~June 30,~~December 31, 2017. The Company generally limits its investment in marketable securities to no more than approximately 10% of its undepreciated assets (which is the Company’s total assets excluding accumulated depreciation). The REIT securities portfolio provides the Company 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 ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company sold or redeemed securities with a cost basis of ~~$8,399,268~~$2,335,015 and recognized a Gain on Sale of Securities Transactions of ~~$2,293,944.~~$100,153. In addition, the Company recognized dividend income on its investment in securities of ~~$4,622,836~~$2,862,644 for the ~~nine~~three months ended ~~June 30,~~December 31, 2017. The Company also made purchases of ~~$39,467,317~~$19,714,857 in Securities Available for Sale at Fair Value. Of this amount, the Company made total purchases of ~~125,719~~14,252 common shares of UMH Properties, Inc. (UMH), a related REIT, for a total cost of ~~$1,725,457,~~$203,097, or a ~~weighted average~~ cost of ~~$13.72~~$14.25 per share, of which ~~112,719 shares~~ were purchased through UMH’s Dividend Reinvestment and Stock Purchase Plan. The Company owned a total of ~~1,115,046~~1,142,568 UMH common shares as of ~~June 30,~~December 31, 2017 at a total cost of ~~$11,031,142~~$11,434,947 and a fair value of ~~$19,011,526.~~$17,024,261. The ~~Company owns 200,000 shares of UMH’s 8.25% Series A Cumulative Redeemable Preferred Stock at a total cost of $5,000,000 with a fair value of $5,200,000 and the~~ Company owns 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 ~~$2,750,000.~~$2,731,550. The unrealized gain on the Company’s investment in UMH’s common and preferred stock as of ~~June 30,~~December 31, 2017 was ~~$8,430,384.~~$5,820,864.

As of ~~June 30,~~December 31, 2017, the Company had total net unrealized holding ~~gains~~losses on its securities portfolio of ~~$8,765,134.~~$4,142,572. The Company considers 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. The Company normally holds REIT securities long-term and has the ability and intent to hold these securities to recovery. The following is a summary of the securities that the Company has determined to be temporarily impaired as of ~~June 30,~~December 31, 2017:

For the three months ended ~~June 30,~~December 31, 2017 and 2016, amortization of financing costs included in interest expense was ~~$283,573~~$293,894 and ~~$240,463, respectively. For the nine months ended June 30, 2017 and 2016, amortization of financing costs included in interest expense was $949,470 and $713,501,~~$280,913, respectively.

The following is a summary of our Fixed Rate Mortgage Notes Payable as of ~~June 30,~~December 31, 2017 and September 30, ~~2016:~~2017:

As of ~~June 30,~~December 31, 2017, interest payable on these mortgages were at fixed rates ranging from 3.45% to 7.60%, with a weighted average interest rate of ~~4.21%~~4.16%. This compares to a weighted average interest rate of ~~4.48%~~4.18% as of September 30, ~~2016~~2017 and ~~4.61%~~4.44% as of ~~June 30,~~December 31, 2016. As of ~~June 30,~~December 31, 2017, 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 ~~10.5~~11.6 years as of September 30, ~~2016~~2017 and ~~9.8~~10.7 years as of ~~June 30,~~December 31, 2016.

In connection with the ~~seven~~two properties acquired during the ~~nine~~three months ended ~~June 30,~~December 31, 2017, which are located in ~~Hamburg (Buffalo), NY; Ft. Myers, FL; Walker (Grand Rapids), MI; Mesquite (Dallas), TX; Aiken (Augusta, GA), SC; Homestead (Miami), FL~~Charleston, SC and Oklahoma City, OK (as described in Note 3), the Company obtained ~~six,~~one 15 year, fully-amortizing mortgage ~~loans~~loan and one, 1210 year ~~fully-amortizing loan.~~loan, amortizing over 18 years. The ~~seven~~two mortgage loans originally totaled ~~$137,925,000~~$33,800,000 with an original weighted average mortgage loan maturity of ~~14.9~~12.1 years and a weighted average interest rate of ~~3.84%~~3.89%.

During the ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company fully repaid 15one mortgage ~~loans associated with 14 of~~loan for its ~~properties~~property located in Jacksonville, FL; El Paso, TX; Lebanon (Cincinnati), OH; Halfmoon (Albany), NY; Bedford Heights (Cleveland), OH; Hanahan (Charleston), SC; Elgin (Chicago), IL; Kansas City, MO; Chattanooga, TN; Roanoke, VA; Orion, MI; Edwardsville, KS; Punta Gorda, FL and Cheektowaga (Buffalo), NY,Richfield, OH, totaling approximately ~~$35,266,000.~~$2,633,000.

During the nine months ended June 30, 2017, the Company fully repaid its two term loans totaling $4,768,266. One loan totaling $2,284,633 had an interest rate of 4.90% and one loan totaling $2,483,633 had a variable annual interest rate of prime plus 0.75% with a floor of 4.50%. The interest rate on the date this loan was fully repaid was 4.50%.

As of ~~June 30,~~December 31, 2017, Loans Payable represented the amount drawn down on the Company’s $200,000,000 unsecured line of credit facility (the Facility) in the amount of ~~$110,000,000 and the amount drawn down on the Company’s margin line of credit on its marketable securities in the amount of $12,094,940.~~

The Facility matures in September 2020 with a one year extension at the Company’s option (subject to various conditions as specified in the loan agreement). During the ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company had ~~net~~no additional draws ~~of $34,000,000~~ 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 7.0% capitalization rate to the NOI generated by the Company’s unencumbered, wholly-owned industrial properties. Borrowings under the Facility, will, at the Company’s election, either i) bear interest at LIBOR plus 140 basis points to 220 basis points, depending on the Company’s leverage ratio, or ii) bear interest at BMO’s prime lending rate plus 40 basis points to 120 basis points, depending on the Company’s leverage ratio. The Company’s borrowings as of ~~June 30,~~December 31, 2017, based on the Company’s leverage ratio as of ~~June 30,~~December 31, 2017, bear interest at LIBOR plus ~~150~~170 basis points, which was at an interest rate of ~~2.54%~~3.06% as of ~~June 30,~~December 31, 2017. In addition, the Company has 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.

The Company also invests in equity securities of other REITs which provides the Company with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. The Company from time to time may purchase these securities on margin, at an interest rate of 2.0%, when the interest and dividend yields exceed the cost of funds. In general, the Company may borrow up to 50% of the value of the marketable securities, which was ~~$100,495,810~~$130,431,475 as of ~~June 30,~~December 31, 2017. As of ~~June 30,~~December 31, 2017, there were no draws against the ~~Company had borrowings of $12,094,940 under its margin line, bearing interest at 2.05%.~~margin.

The Company’s authorized stock as of ~~June 30,~~December 31, 2017 consisted of 192,039,750 shares of common stock, of which ~~73,824,161~~77,209,110 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 ~~8,400,000~~10,879,379 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.

On October ~~1, 2015,~~2, 2017, the Company’s Board of Directors approved a ~~6.7%~~6.25% increase in the Company’s quarterly common stock dividend, raising it to $0.17 per share from $0.16 per share, ~~from $0.15 per share. This~~representing the Company’s second dividend increase in three years. The increased dividend represents an annualized dividend rate of ~~$0.64~~$0.68 per share. The Company has maintained or increased its cash dividend for 2526 consecutive years.

On ~~July 3, 2017,~~January 16, 2018, the Company declared a dividend of ~~$0.16~~$0.17 per share to be paid ~~September~~March 15, ~~2017~~2018 to common shareholders of record as of the close of business on ~~August~~February 15, ~~2017.~~2018.

On January ~~17, 2017,~~16, 2018, the Board of Directors reaffirmed its Share Repurchase Program that authorizes the Company to purchase up to $10,000,000 in the aggregate of the Company’s common stock. The Company may repurchase its shares from time to time if, in the opinion of the Board of Directors, such acquisition is advantageous to the Company. No shares were repurchased during the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and, as of ~~June 30,~~December 31, 2017, the Company does not own any of its own shares.

On September 14, 2016, the Company announced that it intended to redeem all 2,139,750 issued and outstanding shares of its 7.625% Series A Cumulative Redeemable Preferred Stock, $0.01 par value per share (7.625% Series A Preferred Stock). The Company redeemed all of the outstanding shares of the 7.625% Series A Preferred Stock on October 14, 2016, at a redemption price of $25.00 per share, totaling $53,493,750, plus all dividends accrued and unpaid to and including, the redemption date, in an amount equal to $0.23299 per share, totaling $498,540, for a total cash payment of $25.23299 per share, totaling $53,992,290.

On May 5, 2017, the Company announced that it intended to redeem all 2,300,000 issued and outstanding shares of its 7.875% Series B Cumulative Redeemable Preferred Stock, $0.01 par value per share (7.875% Series B Preferred Stock). The Company redeemed all of the outstanding shares of the 7.875% Series B Preferred Stock on June 7, 2017, at a redemption price of $25.00 per share, totaling $57,500,000, plus accumulated and unpaid dividends for the period from June 1, 2017 to, but not including, the redemption date, in an amount equal to $0.0328125, totaling $75,469, for a total cash payment of $25.0328125 per share, totaling $57,575,469. The Company recognized a preferred share redemption charge of approximately $2,467,000 related to the original issuance costs. During the nine months ended June 30, 2017, the Company paid $3,471,566 in Preferred Dividends, or $1.509375 per share, on its then outstanding 7.875% Series B Preferred Stock.

On March 9, 2017, the Company issued an additional 3,000,000 shares of its 6.125% Series C Preferred Stock, liquidation preference of $25.00 per share, at a public offering price of $24.50 per share, for gross proceeds of $73,500,000 before deducting the underwriting discount and offering expenses. Net proceeds from the offering, after deducting underwriting discounts and other offering expenses were approximately $71,003,000. The Company used the net proceeds from this offering to redeem all of the outstanding shares of its 7.875% Series B Preferred Stock, as discussed above. The remaining proceeds were used to purchase properties in the ordinary course of business and for general corporate purposes. Prior to the issuance of the additional 3,000,000 shares of the 6.125% Series C Preferred Stock on March 9, 2017, the Company had 5,400,000 shares of the 6.125% Series C Preferred Stock issued and outstanding. As of June 30, 2017, 8,400,000 shares of the 6.125% Series C Preferred Stock were issued and outstanding.

During the ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company paid ~~$7,074,383~~$4,080,685 in Preferred Dividends, or ~~$1.0973965~~$0.3828125 per share, on its outstanding 6.125% Series C Preferred Stock for the period September ~~13, 2016~~1, 2017 through ~~May~~November 30, 2017. As of December 31, 2017, the Company has accrued Preferred Dividends of $1,388,254 covering the period December 1, 2017 to December 31, 2017. 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 the Company’s 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 the Company’s 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 ~~July 3, 2017,~~January 16, 2018, the Company declared a dividend of $0.3828125 per share to be paid ~~September~~March 15, ~~2017~~2018 to the 6.125% Series C Preferred shareholders of record as of the close of business on ~~August~~February 15, ~~2017.~~2018.

On June 29, 2017, the Company entered into an At-The-Market Preferred Equity Program ~~(ATM Preferred~~(Preferred Stock ATM Program) with FBR Capital Markets & Co. in which the Company may, from time to time, offer and sell additional shares of its 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. The Company began selling shares through the ~~ATM~~ Preferred Stock ATM Program on July 3, 2017. ~~Therefore, as of June 30, 2017, no shares were sold under~~During the ~~ATM Preferred Stock Program. Subsequent to the quarter end, through July 25,~~three months ended December 31, 2017, the Company sold ~~627,867~~1,039,934 shares under its ~~ATM~~ Preferred Stock ATM Program at a weighted average price of ~~$25.44~~$25.13 per share, and generated net proceeds, after offering expenses, of approximately $25,688,000.

As of December 31, 2017, 10,879,379 shares of the 6.125% Series C Preferred Stock were issued and outstanding.

Subsequent to the quarter end, through January 24, 2018, the Company sold 145,997 shares under its Preferred Stock ATM Program at a weighted average price of $25.04 per share, and realized net proceeds, after offering expenses, of approximately ~~$15,628,000.~~$3,595,000.

The Company measures certain financial assets and liabilities at fair value on a recurring basis, including Securities Available for Sale at Fair Value. The Company’s financial assets consist mainly of marketable REIT securities. The fair value of these financial assets was determined using the following inputs at ~~June 30,~~December 31, 2017 and September 30, ~~2016:~~2017:

	Fair Value Measurements at Reporting Date Using								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)			Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of June 30, 2017:
As of December 31, 2017:
Equity Securities – Preferred Stock	$	14,688,025	$	14,688,025	$	-0-	$	-0-	$	8,818,945	$	8,818,945	$	-0-	$	-0-
Equity Securities – Common Stock		85,803,256		85,803,256		-0-		-0-		121,608,411		121,608,411		-0-		-0-
Mortgage Backed Securities		4,529		4,529		-0-		-0-		4,119		4,119		-0-		-0-
Total Securities Available for Sale at Fair Value	$	100,495,810	$	100,495,810	$	-0-	$	-0-	$	130,431,475	$	130,431,475	$	-0-	$	-0-

As of September 30, 2016:
As of September 30, 2017:
Equity Securities – Preferred Stock	$	13,769,073	$	13,769,073	$	-0-	$	-0-	$	11,818,628	$	11,818,628	$	-0-	$	-0-
Equity Securities – Common Stock		59,830,271		59,830,271		-0-		-0-		111,941,806		111,941,806		-0-		-0-
Mortgage Backed Securities		5,550		5,550		-0-		-0-		4,336		4,336		-0-		-0-
Total Securities Available for Sale at Fair Value	$	73,604,894	$	73,604,894	$	-0-	$	-0-	$	123,764,770	$	123,764,770	$	-0-	$	-0-

In addition to the Company’s investments in Securities Available for Sale at Fair Value, the Company is required to disclose certain information about fair values of its 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 the Company’s entire holdings of a financial instrument. For a portion of the Company’s 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 the Company for issuance of debt with similar terms and remaining maturities. These fair value measurements fall within level 2 of the fair value hierarchy. At ~~June 30,~~December 31, 2017, the Fixed Rate Mortgage Notes Payable fair value (estimated based upon expected cash outflows discounted at current market rates) amounted to approximately ~~$571,364,000~~$624,966,000 and the carrying value amounted to $561,736,464. When the Company acquires a property and is accounted for as a business combination, it is required to fair value all of the assets and liabilities, including intangible assets and liabilities, relating to the properties acquired lease (see Note 3).$620,411,537. Those fair value measurements are estimated based on independent third party appraisals and fall within level 3 of the fair value hierarchy.

Cash paid for interest during the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016 was approximately ~~$17,975,000~~$7,198,000 and ~~$15,994,000,~~$5,882,000, respectively.

During the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016, the Company had dividend reinvestments of ~~$7,229,654~~$2,919,972 and ~~$6,326,691,~~$2,077,156, respectively, which required no cash transfers.

From time to time, the Company may be subject to claims and litigation in the ordinary course of business. Management does 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 the quarter end, as described ~~below~~ in Note 10, the Company has entered into agreements to purchase ~~four~~two new build-to-suit, industrial buildings that are currently being developed in Florida ~~Ohio~~ and South Carolina, ~~totaling~~consisting of approximately ~~1,039,000~~660,000 square feet, with net-leased terms ~~ranging from~~of 10 toand 15 years ~~resulting in~~with a weighted average lease ~~maturity~~term of ~~10.6~~12 years. The ~~aggregate~~ purchase price for ~~the four~~these properties is approximately ~~$88,676,000. Two of the four purchase commitments consisting of approximately 420,300~~$78,018,000. Approximately 261,000 square feet, or 40%, ~~are leased to investment grade tenants. Approximately 121,800 square feet, or 12%,~~ is leased to ~~FDX.~~FedEx Ground Package System, Inc. Subject to satisfactory due diligence and other customary closing conditions and requirements, we anticipate closing these ~~four~~ transactions during ~~the remainder of~~ fiscal ~~2017~~2018 and the first ~~half~~quarter of fiscal ~~2018.~~2019. In connection with the ~~four~~two properties, the Company has entered into commitments to obtain ~~three~~two mortgage loans totaling ~~approximately $38,300,000~~$49,360,000 at fixed rates ~~ranging from 4.17% to 4.45%~~of 3.82% and 4.25%, with a weighted average interest rate of ~~4.28%~~3.99%. ~~All three~~Both of these mortgage loans are 15 year, fully-amortizing loans.

The Company ~~currently has parking lot expansions in progress on~~is under contract to sell two properties ~~that are being leased to FedEx Ground Package System, Inc.~~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 the Company’s U.S. GAAP net book carrying value and ~~Indianapolis, IN.~~is anticipated to close during the second quarter of fiscal 2018 (ii) a 68,370 square foot building located in Colorado Springs, CO for $5,800,000, which is approximately the Company’s U.S. GAAP net book carrying value and is anticipated to close during the third quarter of fiscal 2018. The ~~expansion costs~~completion of these two sales are ~~expected~~subject to ~~be approximately $2,661,000. Upon completion, annualized rent will be increased by approximately $237,000 from approximately $2,898,000 to approximately $3,135,000~~customary closing conditions and ~~will provide for a new lease extension, for each property being expanded, of 10 years from the date of completion.~~requirements.

On August 3, 2017, the Company purchased a newly constructed 354,482 square foot industrial building located in Concord, NC which is in the Charlotte MSA. The building is 100% net leased to FedEx Ground Package System, Inc. for 15 years through May 2032. The purchase price was $40,598,446. The Company obtained a 15 year fully-amortizing mortgage loan of $26,184,000 at a fixed interest rate of 3.80%. Annual rental revenue over the remaining term of the lease averages approximately $2,537,000.

Subsequent to quarter end, through July 25, 2017, the Company sold 627,867 shares under its ATM Preferred Stock Program at a weighted average price of $25.44 per share, and realized net proceeds, after offering expenses, of approximately $15,628,000.

In July 2017, the Company entered into a 10.2 year lease agreement with FBM Gypsum Supply of Illinois, LLC through December 31, 2027, for our previously vacant 36,270 square foot building, which became vacant effective June 1, 2017, located in Urbandale, IA. The lease is expected to commence on November 1, 2017, with two months of free rent, after which initial annual rent of $159,588, representing $4.40 per square foot, will commence, with 2.0% annual increases thereafter, resulting in a straight-line annualized rent of $171,880, representing $4.74 per square foot over the life of the lease. This compares to the former average straight-lined rent, prior to the property becoming vacant, of $3.56 per square foot on a U.S. GAAP straight-line basis and the former cash rent of $3.88 per square foot, representing an increase in the average lease rate of 33.2% on a U.S. GAAP straight-line basis and an increase in the lease rate of 13.4% on a cash basis. The tenant will have a one-time early termination option that may be exercised after December 31, 2025, provided that the tenant provides the Company with six months of notice and pays a termination fee equal to three months of rent, plus operating and other costs.

~~On July 3, 2017,~~January 16, 2018, the Company declared a common dividend of ~~$0.16~~$0.17 per share to be paid ~~September~~March 15, ~~2017~~2018 to common shareholders of record as of the close of business on ~~August~~February 15, ~~2017.~~2018.

On ~~July 3, 2017,~~January 16, 2018, the Company declared a preferred dividend of $0.3828125 per share to be paid ~~September~~March 15, ~~2017~~2018 to Series C preferred shareholders of record as of the close of business on ~~August~~February 15, ~~2017.~~2018.

On January 22, 2018, the Company 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. and is guaranteed by Shaw Industries Group, Inc., a wholly owned subsidiary of Berkshire Hathaway, Inc. for 10 years through September 2027. The purchase price was $57,483,636. The Company 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 $3,470,000.

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

The following discussion and analysis of the consolidated financial condition and results of operations should be read in conjunction with the Consolidated Financial Statements and notes thereto provided elsewhere herein and the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, ~~2016.~~2017.

The Company operates as a real estate investment trust (REIT). The Company seeks to invest in well-located, modern single-tenant industrial buildings leased primarily to investment grade tenants or their subsidiaries on long-term net leases. During the ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company purchased ~~seven~~two net-leased industrial properties, located in ~~Hamburg (Buffalo), NY; Ft. Myers, FL; Walker (Grand Rapids), MI; Mesquite (Dallas), TX; Aiken (Augusta, GA), SC; Homestead (Miami), FL~~Charleston, SC and Oklahoma City, OK totaling approximately ~~1,911,000~~422,000 square feet, for approximately ~~$208,124,000.~~$52,122,000. In connection with the ~~seven~~two properties acquired during the ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company entered into ~~six, fifteen~~one, 15 year, fully-amortizing mortgage ~~loans~~loan and one ~~twelve~~10 year ~~fully-amortizing loan.~~mortgage loan, amortizing over 18 years. The ~~seven~~two mortgage loans originally totaled ~~$137,925,000~~$33,800,000 with an original weighted average loan maturity of ~~14.9~~12.1 years and a weighted average interest rate of ~~3.84%~~3.89%. As of ~~June 30,~~December 31, 2017, the Company owned ~~105~~108 properties with total square footage of approximately ~~17,917,000.~~19,096,000. These properties are located in 30 states. As of the quarter ended ~~June 30,~~December 31, 2017, the Company’s weighted average lease maturity was approximately ~~7.8~~7.9 years, its occupancy rate was ~~99.8%~~99.5% and its annualized average base rent per occupied square foot was ~~$5.91.~~$5.99. As of ~~June 30,~~December 31, 2017, the weighted average building age, based on the square footage of the Company’s buildings, was ~~9.4~~9.1 years. In addition, total gross real estate investments, excluding marketable REIT securities investments of ~~$100,495,810,~~$130,431,475, were ~~$1,373,574,748~~$1,484,039,198 as of ~~June 30,~~December 31, 2017.

~~Subsequent to quarter end, on August 3, 2017, the~~The Company ~~purchased a newly constructed 354,482 square foot industrial building located in the Charlotte, NC Metropolitan Statistical Area (MSA) for $40,598,446.~~

~~The Company’s revenue primarily consists of Rental and Reimbursement Revenue from the ownership of industrial rental properties.~~evaluates its financial performance using Net Operating Income (NOI) from property operations, which is ~~defined~~a non-GAAP financial measure that the Company defines as Net Income Attributable to Common Shareholders plus Redemption of Preferred Stock, Preferred Dividends, General &and Administrative Expenses, ~~Acquisitions~~Acquisition Costs, Depreciation, Amortization of Capitalized Lease Costs &and Intangible Assets, ~~and~~ Interest Expense, including Amortization of Financing Costs, less Dividend and Interest Income, Gain on Sale of Securities Transactions, Lease Termination Income and Gain on Sale of ~~Securities Transactions.~~Real Estate Investments. The components of NOI are recurring Rental and Reimbursement Revenue, less Real Estate Taxes and Operating Expenses, such as insurance, utilities and repairs and maintenance. Other REITs may use different methodologies to calculate NOI ~~from property operations increased $3,536,994, or 17%,~~and, accordingly, our NOI may not be comparable to all other REITs.

The following is a reconciliation of the Company’s Net Income Attributable to Common Shareholders to the Company’s NOI for the three months ended ~~June 30,~~December 31, 2017 ~~as compared to the three months ended June 30, 2016~~ and increased $11,841,556, or 20%, for the nine months ended June 30, 2017 as compared to the nine months ended June 30, 2016. These increases were due to the additional income related to eight industrial properties purchased during fiscal 2016 and seven industrial properties purchased during the nine months ended June 30, 2017.2016:

~~The Company’s NOI for the three and nine months ended June 30, 2017 and 2016 is calculated as follows:~~

The components of the Company’s NOI for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2017 and 2016 is as follows:

	Three Months Ended						Nine Months Ended						Three Months Ended
	6/30/2017			6/30/2016			6/30/2017			6/30/2016			12/31/2017			12/31/2016

Rental Revenue	$	24,400,237		$	20,789,914		$	71,291,923		$	59,465,701		$	27,692,482		$	23,280,856
Reimbursement Revenue		4,208,859			3,324,085			11,806,975			9,874,498			5,049,340			3,900,755
Total Rental and Reimbursement Revenue		28,609,096			24,113,999			83,098,898			69,340,199			32,741,822			27,181,611
Real Estate Taxes		(3,520,322	)		(2,633,706	)		(9,279,165	)		(7,681,519	)		(3,862,663	)		(2,906,981	)
Operating Expense		(1,053,253	)		(981,766	)		(3,635,986	)		(3,316,489	)
Operating Expenses														(1,436,241	)		(1,294,468	)
Net Operating Income- NOI	$	24,035,521		$	20,498,527		$	70,183,747		$	58,342,191		$	27,442,918		$	22,980,162

NOI from property operations increased $4,462,756, or 19%, for the three months ended December 31, 2017 as compared to the three months ended December 31, 2016. This increase was due to the additional income related to ten industrial properties purchased during fiscal 2017 and two industrial properties purchased during the three months ended December 31, 2017.

On ~~October 17, 2016,~~November 2, 2017, the Company purchased a newly constructed ~~338,584~~121,683 square foot industrial building, situated on 16.2 acres, located in ~~Hamburg, NY, which is in the Buffalo MSA.~~Charleston, SC. The building is 100% net-leased to FedEx ~~Ground Package System, Inc.~~Corporation (FDX) for 15 years through ~~March 2031.~~August 2032. The purchase price was ~~$35,100,000.~~$21,872,170. The Company obtained a 15 year fully-amortizing mortgage loan of ~~$23,500,000~~$14,200,000 at a fixed interest rate of ~~4.03%~~4.23%. Annual rental revenue over the remaining term of the lease averages approximately ~~$2,309,000.~~$1,312,000.

~~On April 5, 2017,~~Subsequent to quarter end, on January 22, 2018, the Company purchased a newly constructed ~~343,483~~831,764 square foot industrial building, situated on 62.4 acres, located in ~~Walker, MI, which is in the Grand Rapids MSA.~~Savannah, GA. The building is 100% net-leased to ~~FedEx Ground Package System,~~Shaw Industries, Inc. for 1510 years through ~~January 2032.~~September 2027. The purchase price was ~~$32,120,000.~~$57,483,636. The Company obtained a 1514 year fully-amortizing mortgage loan of ~~$20,875,000~~$33,300,000 at a fixed interest rate of ~~3.86%~~3.53%. Annual rental revenue over the remaining term of the lease averages approximately ~~$2,102,000.~~

~~On June 23, 2017,~~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 ~~Company purchased a newly constructed 351,874 square foot industrial building located~~SEC’s website, www.sec.gov. The references in Mesquite, TX, which is in the Dallas MSA. The building is 100% net-leased to FedEx Ground Package System, Inc. for 15 years through March 2032. The purchase price was $50,621,072. The Company obtained a 15 year fully-amortizing mortgage loan of $32,900,000 at a fixed interest rate of 3.60%. Annual rental revenue over the remaining term of the lease averages approximately $3,194,000.

~~Subsequent~~this report to the ~~quarter end,~~SEC’s website are not intended to and do not include or incorporate by reference into this report the information on August 3, 2017, the Company purchased a newly constructed 354,482 square foot industrial building located in Concord, NC which is in the Charlotte MSA. The building is 100% net leased to FedEx Ground Package System, Inc. for 15 years through May 2032. The purchase price was $40,598,446. The Company obtained a 15 year fully-amortizing mortgage loan of $26,184,000 at a fixed interest rate of 3.80%. Annual rental revenue over the remaining term of the lease averages approximately $2,537,000.those websites.

Two leases that were set to expire during fiscal 2018 were leased to Kellogg Sales Company (Kellogg) at the Company’s 65,067 square foot facility located in Kansas City, MO through July 31, 2018 and at the Company’s 50,400 square foot facility located in Orangeburg, NY through February 28, 2018. Kellogg informed the Company that it will not be renewing its leases at these two properties. On ~~October 27, 2016,~~December 18, 2017, the Company sold its ~~only vacant building consisting of a 59,425 square foot industrial building situated on 4.78 acres~~property, located in ~~White Bear Lake, MN~~Kansas City, MO for $4,900,000, with net sale proceeds to the Company of approximately ~~$4,126,000.~~$4,602,000 and on December 22, 2017, the Company sold its property, located in Orangeburg, NY for $6,170,000, with net sale proceeds to the Company 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 on a historic cost undepreciated basis of approximately $1,804,000, representing a 21% net gain over the Company’s historic cost basis. In conjunction with the sale of these two properties, the Company simultaneously entered into a lease termination agreement for each property whereby the Company 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.

In addition to the property purchased subsequent to the quarter end, as described ~~previously,~~above, the Company has entered into agreements to purchase ~~four~~two new build-to-suit, industrial buildings that are currently being developed in Florida ~~Ohio~~ and South Carolina, ~~totaling~~consisting of approximately ~~1,039,000~~660,000 square feet, with net-leased terms ~~ranging from~~of 10 toand 15 years ~~resulting in~~with a weighted average lease ~~maturity~~term of ~~10.6~~12 years. The ~~aggregate~~ purchase price for ~~the four~~these properties is approximately ~~$88,676,000. Two of the four purchase commitments consisting of approximately 420,300~~$78,018,000. Approximately 261,000 square feet, or 40%, ~~are leased to investment grade tenants. Approximately 121,800 square feet, or 12%,~~ is leased to ~~FDX.~~FedEx Ground Package System, Inc. Subject to satisfactory due diligence and other customary closing conditions and requirements, we anticipate closing these ~~four~~ transactions during ~~the remainder of~~ fiscal ~~2017~~2018 and the first ~~half~~quarter of fiscal ~~2018.~~2019. In connection with the ~~four~~two properties, the Company has entered into commitments to obtain ~~three~~two mortgage loans totaling ~~approximately $38,300,000~~$49,360,000 at fixed rates ~~ranging from 4.17% to 4.45%~~of 3.82% and 4.25%, with a weighted average interest rate of ~~4.28%~~3.99%. ~~All three~~Both of these mortgage loans are 15 year, fully-amortizing loans.

See PART I, Item 1 – Business in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, ~~2016~~2017 for a more complete discussion of the economic and industry-wide factors relevant to the Company and the opportunities, challenges, and risks on which the Company is focused.

The discussion and analysis of the Company’s financial condition and results of operations are based upon the Company’s Consolidated Financial Statements, which have been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (U.S. GAAP). The preparation of these Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities at the date of the Company’s Consolidated Financial Statements. Actual results may differ from these estimates under different assumptions or conditions.

As a result of adopting Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business” (ASU 2017-01) prospectively as of April 1, 2017, as permitted under the standard, effective April 1, 2017 we no longer account for our property acquisitions as business combinations and instead we account for our property acquisitions as acquisitions of assets. In an acquisition of assets, certain acquisition costs are capitalized to real estate investments as part of the purchase price as opposed to being expensed as Acquisition Costs under the previous accounting treatment for business combinations.

On a regular basis, management evaluates our assumptions, judgments and estimates. Management believes that ~~except for the adoption of ASU 2017-01, as described above,~~ there have been no ~~other~~ material changes to the items that we disclosed as our significant accounting policies and estimates under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our annual report on Form 10-K for fiscal year ended September 30, ~~2016.~~2017.

As of ~~June 30,~~December 31, 2017, the Company owned ~~105~~108 properties with total square footage of approximately ~~17,917,000,~~19,096,000, as compared to 97100 properties with total square footage of approximately ~~15,124,000,~~16,554,000, as of ~~June 30,~~December 31, 2016, representing an increase in square footage of ~~18%~~15%. At quarter end, the Company’s weighted average lease expiration term was approximately ~~7.8~~7.9 years as compared to ~~7.1~~7.4 years at the end of the prior year period. The Company’s occupancy rate was ~~99.8%~~99.5% as of ~~June 30,~~December 31, 2017 as compared to ~~99.6%~~100.0% as of ~~June 30,~~December 31, 2016, representing ~~an increase~~a decrease of 2050 basis points. The Company’s weighted average building age was ~~9.4~~9.1 years as of ~~June 30,~~December 31, 2017 as compared to ~~10.0~~9.9 years as of ~~June 30,~~December 31, 2016.

In fiscal ~~2017,~~2018, approximately 9%8% of our gross leasable area, representing 1316 leases totaling ~~1,539,526~~1,546,637 square feet, ~~were~~is set to expire. As of the date of this quarterly report, 106 of the 1316 leases have renewed. One of the 10 leases (which is with FedEx Ground Package System, Inc. for a property located in Ft. Myers, FL), has renewed for only eight months because the tenant has moved its operations from our 87,500 square foot facility to our newly constructed facility, which is also located in Ft. Myers, FL. As discussed above, on December 30, 2016, we purchased this newly constructed 213,672 square foot industrial building which is leased for 10 years through September 2026. Excluding the eight-month lease renewal at the original Ft. Myers, FL location, the nineThe six leases that have renewed thus far represent ~~1,272,030~~568,898 square feet, or ~~83%~~37% of the expiring square footage, and have a weighted average lease term of ~~6.5~~6.1 years.

We have incurred, or we expect to incur tenant improvement costs of approximately ~~$2,961,000~~$435,000 and leasing commission costs of approximately ~~$1,197,000~~$432,000 in connection with these ~~nine~~five lease renewals. The table below summarizes the lease terms of the ~~nine~~five leases which were renewed. In addition, the table below includes both the tenant improvement costs and the leasing commission costs, which are presented on a per square foot (PSF) basis averaged over the renewal term.

~~Excluding the eight-month lease renewal at the original Ft. Myers, FL location, representing 5.7% of the space coming up for renewal in fiscal 2017, the remaining nine~~These six lease renewals result in a weighted average term of ~~6.5~~6.1 years and a renewed U.S. GAAP straight-line weighted average lease rate of ~~$5.61~~$4.85 per square foot. The renewed weighted average initial cash rent per square foot is ~~$5.49.~~also $4.85. This compares to the former weighted average rent of ~~$5.68~~$4.67 per square foot on a U.S. GAAP straight-line basis and the former weighted average cash rent of ~~$5.74~~$4.78 per square foot, representing an increase in the weighted average lease rate of 3.9% on a U.S. GAAP straight-line basis and an increase in the weighted average lease rate of 1.5% on a cash basis.

Two leases that were set to expire during fiscal 2018 were leased to Kellogg at the Company’s 65,067 square foot facility located in Kansas City, MO through July 31, 2018 and at the Company’s 50,400 square foot facility located in Orangeburg, NY through February 28, 2018. Kellogg informed the Company that it will not be renewing its leases at these two properties. On December 18, 2017, the Company sold its property, located in Kansas City, MO for $4,900,000, with net sale proceeds to the Company of approximately $4,602,000 and on December 22, 2017, the Company sold its property, located in Orangeburg, NY for $6,170,000, with net sale proceeds to the Company 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 on a historic cost undepreciated basis of approximately $1,804,000, representing a 21% net gain over the Company’s historic cost basis. In conjunction with the sale of these two properties, the Company simultaneously entered into a lease termination agreement for each property whereby the Company 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.

Another remaining lease set to expire during fiscal 2018 is leased to Caterpillar Logistics Services, Inc. (Caterpillar) at our 218,120 square foot facility located in Griffin, GA through December 31, 2017. In September 2017, we entered into a three year lease agreement with Rinnai America Corporation through December 31, 2020 for this location. The new lease commenced on January 1, 2018, with initial annual rent of $807,044, representing $3.70 per square foot, with 3.0% annual increases thereafter, resulting in a straight-line annualized rent of $831,000, representing $3.81 per square foot over the life of the lease. This compares to the former U.S. GAAP straight-line and the former cash rent of $5.36 per square foot, representing a decrease in the ~~weighted~~ average lease rate of ~~1.2%~~28.9% on a U.S. GAAP straight-line basis and a decrease in the ~~weighted average~~ lease rate of ~~4.4%~~31.0% on a cash basis.

Our 68,370 square foot facility located in Colorado Springs, CO is leased by FedEx Ground Package System, Inc. through September 30, 2018. The tenant has informed ~~by one tenant~~us that they will not be ~~renewing. This tenant~~renewing this lease because they have moved its operations from our 68,370 square foot facility to our recently constructed 225,362 square foot facility, which is also located in Colorado Springs, CO. On June 9, 2016, we purchased this newly constructed 225,362 square foot industrial building, which is leased for 10 years through January 2026. The original 68,370 square foot Colorado Springs, CO facility is under contract to sell for $5,800,000, which is approximately the Company’s U.S. GAAP net book carrying value, and is anticipated to close during the third quarter of fiscal 2018, subject to customary closing conditions and requirements.

One of our tenants that leases 80,856 square feet at our 255,658 square foot building located in Monaca (Pittsburgh), PA has informed us that they will not be renewing their lease, which expired on December 31, 2017.

The remaining five leases that are still set to expire during fiscal 2018 are currently under discussion.

One property subject to a lease that expired in fiscal 2017 and was not renewed was our 36,270 square ~~feet~~foot facility located in Urbandale ~~IA through May 31, 2017. This facility represents 2% of the space that was up for renewal in fiscal 2017. In July~~(Des Moines), IA. Effective November 1, 2017, we entered into a 10.2 year lease agreement with FBM Gypsum Supply of Illinois, LLC through December 31, 2027 for this ~~36,270 square foot building located in Urbandale, IA.~~facility. The ~~new~~ lease ~~is expected to commence on November 1, 2017, with~~agreement provides for two months of free rent, after which, on January 1, 2018, initial annual rent of $159,588, representing $4.40 per square foot ~~will commence,~~commenced, with 2.0% annual increases thereafter, resulting in a straight-line annualized rent of ~~$171,880,~~approximately $172,000, representing $4.74 per square foot over the life of the lease. This compares to the former average ~~straight-lined~~ rent of $3.56 per square foot on a U.S. GAAP straight-line basis and the former cash rent of $3.88 per square foot, representing an increase in the average lease rate of ~~33.2%~~33.1% on a U.S. GAAP straight-line basis and an increase in the lease rate of 13.4% on a cash basis. The tenant will have a one-time early termination option that may be exercised after December 31, 2025, provided that the tenant provides us with six months of notice and pays a termination fee equal to three months of rent, plus operating and other costs.

~~The remaining two leases that are still set to expire during fiscal 2017 are currently under discussion.~~

Rental Revenue increased ~~$3,610,323,~~$4,411,626, or ~~17%~~19%, for the three months ended ~~June 30,~~December 31, 2017 as compared to the three months ended ~~June 30, 2016. Rental Revenue increased $11,826,222, or 20%, for the nine months ended June 30, 2017 as compared to the nine months ended June 30,~~December 31, 2016. These increases were primarily due to the acquisition of eight properties purchased during the last three quarters of fiscal 2017 and the two properties purchased during the ~~last quarter of fiscal 2016 and the seven properties purchased during the~~ first ~~nine~~three months of fiscal ~~2017 as well as the 20 basis point increase in the Company’s occupancy rate from 99.6% as of June 30, 2016 to 99.8% as of June 30, 2017.~~2018.

Our single-tenant properties are subject to net leases which require the tenants to reimburse us for the cost of Real Estate Taxes as well as certain Operating Expenses such as insurance and the majority of repairs and maintenance. For the three months ended ~~June 30,~~December 31, 2017 compared to the three months ended ~~June 30,~~December 31, 2016, Reimbursement Revenue increased ~~$884,774,~~$1,148,585, or ~~27%~~29%, Real Estate Tax Expense increased ~~$886,616,~~$955,682, or ~~34%~~33%, and Operating Expenses increased ~~$71,487,~~$141,773, or 7%. For the nine months ended June 30, 2017 compared to the nine months ended June 30, 2016, Reimbursement Revenue increased $1,932,477, or 20%, Real Estate Tax Expense increased $1,597,646, or 21%, and Operating Expenses increased $319,497, or 10%11%. These increases in Reimbursement Revenue, Real Estate Taxes and Operating Expenses for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2017 were primarily due to our newly acquired properties. Reimbursement Revenue as a percentage of Real Estate Taxes and Operating Expenses for the three months ended ~~June 30,~~December 31, 2017 and 2016 remain in line at ~~92% for each period~~95% and ~~Reimbursement Revenue as a percentage of Real Estate Taxes and Operating Expenses for the nine months ended June 30, 2017 and 2016 remain in line at 91% and 90%~~93%, respectively.

General and Administrative Expenses increased ~~$244,420,~~$504,569, or ~~16%~~35%, for the three months ended ~~June 30,~~December 31, 2017 as compared to the three months ended ~~June 30,~~December 31, 2016. This increase was primarily due to an increase in ~~professional fees. General and Administrative Expenses increased $208,012, or 4%, for the nine months ended June 30, 2017 as compared to the nine months ended June 30, 2016.~~salaries. General and Administrative Expenses, as a percentage of gross revenue, (which includes Rental Revenue, Reimbursement Revenue and Dividend and Interest Income), are ~~5.9%~~5.5% for the three months ended ~~June 30,~~December 31, 2017 as compared to ~~6.0%~~5.1% for the three months ended ~~June 30, 2016 and are 6.1% for the nine months ended June 30, 2017 as compared to 6.9% for the nine months ended June 30,~~December 31, 2016. Annualized General and Administrative Expenses, as a percentage of undepreciated assets (which is the Company’s total assets excluding accumulated depreciation) are 3546 basis points and 5142 basis points for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016, respectively.

Acquisition Costs amounted to $-0- and ~~$135,358~~$178,526 for the three months ended ~~June 30, 2017 and 2016, respectively. Acquisition Costs amounted to $178,526 and $545,955 for the nine months ended June 30,~~December 31, 2017 and 2016, respectively. As a result of adopting ASU 2017-01, prospectively as of April 1, 2017, as permitted under the standard, effective April 1, 2017, we no longer account for our property acquisitions as business combinations and instead we account for our property acquisitions as acquisitions of assets. In an acquisition of assets, certain acquisition costs are capitalized to real estate investments as part of the purchase price as opposed to being expensed as Acquisition Costs under the previous accounting treatment for business combinations. Therefore, ~~as of~~subsequent to April 1, 2017, we no longer ~~incur~~expense Acquisition ~~Costs.~~Costs for our property acquisitions.

The Company recognized a Gain on Sale of Securities Transactions of ~~$1,487,836~~$100,153 and ~~$272,067~~$806,108 for the three months ended ~~June 30, 2017 and 2016, respectively, and recognized a Gain on Sale of Securities Transactions of $2,293,944 and $1,159,409 for the nine months ended June 30,~~December 31, 2017 and 2016, respectively. In addition, the Company’s unrealized holding gains on its investment in securities decreased from an unrealized gain of ~~$12,942,267~~$6,570,565 as of September 30, ~~2016~~2017 to an unrealized ~~gain~~loss of ~~$8,765,134~~$4,142,572 as of ~~June 30,~~December 31, 2017, resulting in a decrease for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 of ~~$4,177,133.~~$10,713,137. The Company recognized dividend income on its investment in securities of ~~$1,896,029~~$2,862,644 and ~~$1,481,197~~$1,288,803 for the three months ended ~~June 30,~~December 31, 2017 and 2016, respectively, representing an increase of ~~28%~~122%. ~~The Company recognized dividend income on its investment in securities of $4,622,836 and $4,044,920 for the nine months ended June 30, 2017 and 2016, respectively, representing an~~This increase ~~of 14%. These increases are~~is due to a higher average carrying value of the REIT securities portfolio during the current ~~nine~~three month period compared to the prior year ~~nine~~three month period. The REIT securities portfolio’s weighted average yield for ~~nine~~three months ended ~~June 30,~~December 31, 2017 was approximately ~~7.1%~~9.1% as compared to ~~8.4%~~7.4% for the ~~nine~~three months ended ~~June 30,~~December 31, 2016.

Interest Expense, including Amortization of Financing Costs, increased ~~$330,022,~~$1,242,728, or 6%20%, for the three months ended ~~June 30,~~December 31, 2017 as compared to the three months ended ~~June 30, 2016. Interest Expense, including Amortization of Financing Costs, increased $2,128,251, or 13%, for the nine months ended June 30, 2017 as compared to the nine months ended June 30,~~December 31, 2016. This increase is primarily due to an increase in the average balance of Fixed Rate Mortgage Notes Payable due to the newly acquired properties purchased since ~~July~~January 1, ~~2016.~~2017. The Fixed Rate Mortgage Notes Payable balance increased ~~$121,383,638~~$108,119,401 or ~~28%~~21% from ~~June 30,~~December 31, 2016 to ~~June 30,~~December 31, 2017. This increase was partially offset by a decrease of 4028 basis points in the weighted average interest rate of the Fixed Rate Mortgage Notes Payable, which decreased from ~~4.61%~~4.44% at ~~June 30,~~December 31, 2016 to ~~4.21%~~4.16% at ~~June 30,~~December 31, 2017.

The Company generated Net Cash from Operating Activities of ~~$50,191,019~~$17,090,439 and ~~$43,346,646~~$14,152,706 for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016, respectively.

Net Real Estate Investments increased ~~$181,864,561~~$43,690,960 from September 30, ~~2016~~2017 to ~~June 30,~~December 31, 2017. This increase was mainly due to the purchase of ~~seven~~two net-leased industrial properties, located in ~~Hamburg (Buffalo), NY; Ft. Myers, FL; Walker (Grand Rapids), MI; Mesquite (Dallas), TX; Aiken (Augusta, GA), SC; Homestead (Miami), FL~~Charleston, SC and Oklahoma City, OK, totaling approximately ~~1,911,000~~422,000 square feet, for approximately ~~$208,124,000,~~$52,122,000, of which approximately ~~$204,827,000~~$51,366,000 was allocated to Net Real Estate Investments. The increase was partially offset by Depreciation Expense for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 of ~~$21,449,830.~~$8,483,984.

Securities Available for Sale increased ~~$26,890,916~~$6,666,705 from September 30, ~~2016~~2017 to ~~June 30,~~December 31, 2017. The increase was due to the purchase of securities totaling ~~$39,467,317,~~$19,714,857, offset by the sale of securities with a cost basis of ~~$8,399,268,~~$2,335,015, which resulted in realized gains totaling ~~$2,293,944~~$100,153 and by a net decrease in Unrealized Holding ~~Gains~~Gain (Loss) of ~~$4,177,133.~~$10,713,137.

Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs (Mortgage Notes Payable) increased ~~$77,010,946~~$21,287,064 from September 30, ~~2016~~2017 to ~~June 30,~~December 31, 2017. The increase was mostly due to the origination of ~~seven~~two fixed rate mortgages totaling ~~$137,925,000~~$33,800,000 obtained in connection with the acquisitions of ~~seven~~two industrial properties purchased in the first ~~three quarters~~quarter of fiscal ~~2017.~~2018. These ~~seven~~two mortgage loans have an original weighted average loan maturity of ~~14.9~~12.1 years and a weighted average interest rate of ~~3.84%~~3.89%. Details on these ~~seven~~two fixed rate mortgages are as follows:

The increase in Mortgage Notes Payable was also partially due to the amortization of financing costs associated with the Mortgage Notes Payable of approximately ~~$670,000.~~$200,000. This increase was partially offset by scheduled payments of principal of approximately ~~$59,937,000,~~$12,351,000, which includes the full repayment of the Company’s ~~15 mortgages~~one mortgage associated with ~~14 properties~~a property located in Jacksonville, FL; El Paso, TX; Lebanon (Cincinnati), OH; Halfmoon (Albany), NY; Bedford Heights (Cleveland), OH; Hanahan (Charleston), SC; Elgin (Chicago), IL; Kansas City, MO; Chattanooga, TN; Roanoke, VA; Orion, MI; Edwardsville, KS; Punta Gorda, FL; and Cheektowaga (Buffalo), NY, totalingRichfield, OH for approximately ~~$35,266,000.~~$2,633,000. In addition, the increase in Mortgage Notes Payable was partially offset by the addition of deferred financing costs of approximately ~~$1,648,000,~~$362,000, of which approximately ~~$1,605,000~~$348,000 is associated with the ~~seven~~two mortgages obtained in connection with the acquisitions of the ~~seven~~two industrial properties purchased in the first ~~nine~~three months of fiscal ~~2017.~~2018.

Excluding Debt Issuance Costs, the weighted average interest rate on the Fixed Rate Mortgage Notes Payable decreased by 4028 basis points from the prior year quarter from ~~4.61%~~4.44% at ~~June 30,~~December 31, 2016 to ~~4.21%~~4.16% at ~~June 30,~~December 31, 2017.

The Company is scheduled to repay a total of approximately ~~$49,002,000~~$50,035,000 in mortgage principal payments over the next 12 months. The Company intends to make these principal payments from the funds generated from Cash from Operations, the DRIP, the At-The-Market Preferred Equity Program ~~(ATM Preferred~~(Preferred Stock ATM Program) and draws from the unsecured line of credit facility.

Net Cash Provided by Operating Activities was ~~$50,191,019~~$17,090,439 and ~~$43,346,646~~$14,152,706 for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016, respectively. Dividends paid on common stock for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016 were ~~$34,311,041~~$13,016,721 and ~~$31,114,788,~~$11,184,399, respectively, (of which ~~$7,229,654~~$2,919,972 and ~~$6,326,691,~~$2,077,156, respectively, were reinvested). The Company pays dividends from cash generated from operations.

As of ~~June 30,~~December 31, 2017, the Company held ~~$100,495,810~~$130,431,475 in marketable REIT securities, representing ~~6.6%~~7.8% of the Company’s undepreciated assets (which is the Company’s total assets excluding accumulated depreciation). The Company generally limits its marketable securities investments to no more than approximately 10% of its undepreciated assets. The Company from time to time may purchase these securities on margin when the interest and dividend yields exceed the cost of funds. In general, the Company may borrow up to 50% of the value of the marketable securities. As of ~~June 30,~~December 31, 2017, there were no draws against the ~~Company had borrowings of $12,094,940 under its margin line, bearing interest at 2.05%.~~margin. The marketable REIT securities portfolio provides the Company with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. As of ~~June 30,~~December 31, 2017, the Company had net Unrealized Holding ~~Gains~~Losses on its portfolio of ~~$8,765,134~~$4,142,572 as compared to net Unrealized Holding Gains of ~~$12,942,267~~$6,570,565 as of September 30, ~~2016,~~2017, representing a decrease of ~~$4,177,133.~~$10,713,137. The Company recognized a Gain on Sale of Securities Transactions of ~~$1,487,836~~$100,153 and ~~$272,067~~$806,108 for the three months ended ~~June 30, 2017 and 2016, respectively, and recognized a Gain on Sale of Securities Transactions of $2,293,944 and $1,159,409 for the nine months ended June 30,~~December 31, 2017 and 2016, respectively. The Company recognized dividend income on its investment in securities of ~~$1,896,029~~$2,862,644 and ~~$1,481,197~~$1,288,803 for the three months ended ~~June 30,~~December 31, 2017 and 2016, respectively, representing an increase of ~~28%, and $4,622,836 and $4,044,920 for the nine months ended June 30, 2017 and 2016, respectively, representing an increase of 14%~~122%. The dividends received from the Company’s investments ~~which yielded approximately 7.1% for the nine months ended June 30, 2017,~~ continue to meet our expectations.

As of ~~June 30,~~December 31, 2017, the Company owned ~~105~~108 properties, of which 5761 carried mortgage loans with outstanding principal balances totaling ~~$561,736,464.~~$620,411,537. The 4847 unencumbered properties could be refinanced to raise additional funds, although covenants in the Company’s unsecured line of credit facility (the Facility) limit the amount of unencumbered properties that can be mortgaged. As of ~~June 30,~~December 31, 2017, the Company has drawn down $110,000,000 on the Facility, which had an interest rate of ~~2.54%~~3.06%. The Facility has an additional $100,000,000 accordion feature, which brings the total potential availability up to $300,000,000. The Facility matures September 2020, with a one-year extension at the Company’s option.

As of ~~June 30,~~December 31, 2017, the Company had total assets of ~~$1,351,618,012~~$1,499,124,917 and liabilities of ~~$693,371,837.~~$745,041,116. The Company’s net debt (net of unamortized debt issuance costs and net of cash and cash equivalents) to total market capitalization as of ~~June 30,~~December 31, 2017 was approximately ~~33%~~30% and the Company’s net debt, less marketable securities (net of unamortized debt issuance costs, net of cash and cash equivalents and net of marketable securities) to total market capitalization as of ~~June 30,~~December 31, 2017 was approximately ~~28%~~25%. The Company believes that it has the ability to meet its obligations and to generate funds for new investments.

On March 9, 2017, the Company issued an additional 3,000,000 shares of its 6.125% Series C Preferred Stock, liquidation preference of $25.00 per share, at a public offering price of $24.50 per share, for gross proceeds of $73,500,000 before deducting the underwriting discount and offering expenses. Net proceeds from the offering, after deducting underwriting discounts and other offering expenses were approximately $71,003,000. The Company used the net proceeds from this offering to redeem all of the outstanding shares of its 7.875% Series B Preferred Stock, as discussed below. The remaining proceeds were used to purchase properties in the ordinary course of business and for general corporate purposes. Prior to the issuance of the additional 3,000,000 shares of the 6.125% Series C Preferred Stock on March 9, 2017, the Company had 5,400,000 shares of the 6.125% Series C Preferred Stock issued and outstanding. As of June 30, 2017, 8,400,000 shares of the 6.125% Series C Preferred Stock were issued and outstanding.

On June 29, 2017, the Company entered into ~~an ATM~~a Preferred Stock ATM Program with FBR Capital Markets & Co. in which the Company may, from time to time, offer and sell additional shares of its 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. The Company began selling shares through the ~~ATM~~ Preferred Stock ATM Program on July 3, 2017. ~~Therefore, as of June 30, 2017, no shares were sold under~~During the ~~ATM Preferred Stock Program. Subsequent to the quarter end, through July 25,~~three months ended December 31, 2017, the Company sold ~~627,867~~1,039,934 shares under its ~~ATM~~ Preferred Stock ATM Program at a weighted average price of ~~$25.44~~$25.13 per share, and generated net proceeds, after offering expenses, of approximately $25,688,000.

As of December 31, 2017, 10,879,379 shares of the 6.125% Series C Preferred Stock were issued and outstanding.

The Company raised ~~$66,340,821~~$25,531,430 (including dividend reinvestments of ~~$7,229,654)~~$2,919,972) from the issuance of ~~4,903,189~~1,546,089 shares of common stock under the DRIP during the ~~nine~~three months ended ~~June 30,~~December 31, 2017. Of this amount, UMH Properties, Inc. (UMH), a related REIT, made total purchases of ~~78,242~~22,506 common shares for a total cost of ~~$1,071,805,~~$382,828, or a weighted average cost of ~~$13.70~~$17.01 per share. During the ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company paid ~~$34,311,041~~$13,016,721 in total cash dividends, or ~~$0.16~~$0.17 per share to common shareholders, of which ~~$7,229,654~~$2,919,972 was reinvested in the DRIP. On ~~July 3, 2017,~~January 16, 2018, the Company declared a dividend of ~~$0.16~~$0.17 per common share to be paid on ~~September~~March 15, ~~2017~~2018 to common shareholders of record as of the close of business on ~~August~~February 15, ~~2017.~~2018.

The Company redeemed all of the outstanding shares of its 7.625% Series A Preferred Stock on October 14, 2016 at a redemption price of $25.00 per share, totaling $53,493,750, plus all dividends accrued and unpaid to and including, the redemption date, in an amount equal to $0.23299 per share, totaling $498,540, for a total cash payment of $25.23299 per share, totaling $53,992,290.

The Company redeemed all of the outstanding shares of its 7.875% Series B Preferred Stock on June 7, 2017 at a redemption price of $25.00 per share, totaling $57,500,000, plus accumulated and unpaid dividends for the period from June 1, 2017 to, but not including, the redemption date, in an amount equal to $0.0328125, totaling $75,469, for a total cash payment of $25.0328125 per share, totaling $57,575,469. The Company recognized a preferred share redemption charge of approximately $2,467,000 related to the~~original issuance costs.~~ During the ~~nine~~three months ended ~~June 30,~~December 31, 2017, the Company paid ~~$3,471,566~~$4,080,685 in Preferred Dividends, or ~~$1.509375 per share, on its then outstanding 7.875% Series B Preferred Stock.~~

~~During the nine months ended June 30, 2017, the Company paid $7,074,383 in Preferred Dividends, or $1.0973965~~$0.3828125 per share, on its outstanding 6.125% Series C Preferred Stock for the period September ~~13, 2016~~1, 2017 through ~~May~~November 30, 2017. As of December 31, 2017, the Company has accrued Preferred Dividends of $1,388,254 covering the period December 1, 2017 to December 31, 2017. Dividends on the 6.125% Series C Preferred Stock are cumulative and payable quarterly at an annual rate of $1.53125 per share. On ~~July 3, 2017,~~January 16, 2018, the Company declared a dividend of $0.3828125 per share to be paid ~~September~~March 15, ~~2017~~2018 to the 6.125% Series C Preferred shareholders of record as of the close of business on ~~August~~February 15, ~~2017.~~2018.

The Company uses a variety of sources to fund its cash needs in addition to cash generated from operations. The Company may sell marketable securities from its investment portfolio, borrow on its unsecured line of credit facility or securities margin loans, refinance debt, or raise capital through the DRIP, the ~~ATM~~ Preferred Stock ATM Program or capital markets.

The Company has been raising capital through its DRIP, the ~~ATM~~ Preferred Stock ATM Program, mortgage loans, draws on its unsecured line of credit, sale of marketable securities and funds generated from its investments in net-leased industrial properties, as well as the issuance of additional shares of 6.125% Series C Preferred Stock. The Company may raise capital through registered direct placements and public offerings of common and preferred stock. The Company believes that funds generated from operations, from the DRIP and from the ~~ATM~~ Preferred Stock ATM Program, its ability to finance and refinance its properties, and its availability under its unsecured line of credit will provide sufficient funds to adequately meet its obligations over the next year.

The Company has a concentration of FDX and FDX subsidiary-leased properties, consisting of 5859 separate stand-alone leases covering approximately ~~9,124,000~~9,513,000 square feet as of ~~June 30,~~December 31, 2017 and 5155 separate stand-alone leases covering approximately ~~6,944,000~~8,187,000 square feet as of ~~June 30,~~December 31, 2016. The 5859 separate stand-alone leases that are leased to FDX and FDX subsidiaries have a weighted average lease maturity of ~~8.4~~8.7 years. The percentage of FDX and its subsidiaries leased square footage to the total of the Company’s rental space was ~~51%~~50% (8% to FDX and 42% to FDX subsidiaries) as of December 31, 2017 and 49% (6% to FDX and 43% to FDX subsidiaries) as of ~~June 30, 2017 and 46% (6% to FDX and 40% to FDX subsidiaries) as of June 30,~~December 31, 2016. As of ~~June 30,~~December 31, 2017, the only tenants that leased 5% or more of the Company’s total square footage were FDX and its subsidiaries and Milwaukee Electric Tool Corporation, which leases one property through July 2028 consisting of approximately 862,000 square feet, which was approximately 5% of the Company’s rental space. As of ~~June 30, 2016,~~December 31, 2017, no other tenant, other than FDX and its subsidiaries and Milwaukee Electric Tool Corporation, accounted for 5% or more of the Company’s total rental space.

FDX is a publicly-owned company and financial information related to this entity is available at the SEC’s website,www.sec.gov. FDX is rated “BBB” by S&P Global Ratings (www.standardandpoors.com) and is rated “Baa2” by Moody’s (www.moodys.com), which are both considered “Investment Grade” ratings. The references in this report to the SEC’s website, S&P Global Ratings’ website and Moody’s website are not intended to and do not include or incorporate by reference into this report the information of FDX, S&P Global Ratings or Moody’s on such websites.

In addition to the property purchased subsequent to the quarter end, ~~as described previously,~~ the Company has entered into agreements to purchase ~~four~~two new build-to-suit, industrial buildings that are currently being developed in Florida ~~Ohio~~ and South Carolina, ~~totaling~~consisting of approximately ~~1,039,000~~660,000 square feet, with net-leased terms ~~ranging from~~of 10 toand 15 years ~~resulting in~~with a weighted average lease ~~maturity~~term of ~~10.6~~12 years. The ~~aggregate~~ purchase price for ~~the four~~these properties is approximately ~~$88,676,000. Two of the four purchase commitments consisting of approximately 420,300~~$78,018,000. Approximately 261,000 square feet, or 40%, ~~are leased to investment grade tenants. Approximately 121,800 square feet, or 12%,~~ is leased to ~~FDX.~~FedEx Ground Package System, Inc. Subject to satisfactory due diligence and other customary closing conditions and requirements, we anticipate closing these ~~four~~ transactions during ~~the remainder of~~ fiscal ~~2017~~2018 and the first ~~half~~quarter of fiscal ~~2018.~~2019. In connection with the ~~four~~two properties, the Company has entered into commitments to obtain ~~three~~two mortgage loans totaling ~~approximately $38,300,000~~$49,360,000 at fixed rates ranging ~~from 4.17% to 4.45%~~of 3.82% and 4.25%, with a weighted average interest rate of ~~4.28%~~3.99%. ~~All three~~Both of these mortgage loans are 15 year, fully-amortizing loans.

The Company ~~currently has parking lot expansions in progress on~~is under contract to sell two properties ~~that are being leased to FedEx Ground Package System, Inc.~~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 the Company’s U.S. GAAP net book carrying value and ~~Indianapolis, IN.~~is anticipated to close during the second quarter of fiscal 2018 (ii) a 68,370 square foot building located in Colorado Springs, CO for $5,800,000, which is approximately the Company’s U.S. GAAP net book carrying value and is anticipated to close during the third quarter of fiscal 2018. The ~~expansion costs~~completion of these two sales are ~~expected~~subject to ~~be approximately $2,661,000. Upon completion, annualized rent will be increased by approximately $237,000 from approximately $2,898,000 to approximately $3,135,000~~customary closing conditions and ~~will provide for a new lease extension, for each property being expanded, of ten years from the date of completion.~~requirements.

The Company intends to acquire additional net-leased industrial properties on long-term leases, primarily to investment grade tenants or their subsidiaries, and when needed, expand its current properties. The funds may come from free cash flow from operations, mortgage loans, draws on our unsecured line of credit, cash on hand, sale of marketable securities, other bank borrowings, proceeds from the DRIP, proceeds from the ~~ATM~~ Preferred Stock ATM Program, private placements and public offerings of additional common or preferred stock or other securities. To the extent that funds or appropriate properties are not available, fewer acquisitions will be made.

Funds From Operations, Core Funds From Operations and ~~Core~~Adjusted Funds From Operations

We assess and measure our overall operating results based upon an industry performance measure referred to as Funds From Operations (FFO), which management believes is a useful indicator of our operating performance. FFO is used by industry analysts and investors as a supplemental operating performance measure of a REIT. FFO, as defined by the National Association of Real Estate Investment Trusts (NAREIT), represents net income attributable to common shareholders, as defined by accounting principles generally accepted in the United States of America (U.S. GAAP), excluding extraordinary items, as defined under U.S. GAAP, gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization. NAREIT created FFO as a non-U.S. GAAP supplemental measure of REIT operating performance. We define Core Funds From Operations (Core FFO) as FFO, excluding acquisition costs and costs associated with the Redemption of Preferred Stock. We define Adjusted Funds ~~from~~From Operations (AFFO) as Core FFO, excluding stock based compensation expense, depreciation of corporate office tenant improvements, amortization of deferred financing costs, lease termination income, net gain or loss on sale of securities transactions, effect of non-cash U.S. GAAP straight-line rent adjustments, non-recurring other expenses and less recurring capital expenditures. We define recurring capital expenditures as all capital expenditures, excluding capital expenditures related to expansions at our current locations or capital expenditures that are incurred in conjunction with obtaining a new lease or a lease renewal. We believe that, as widely recognized measures of performance used by other REITs, FFO, Core FFO and AFFO may be considered by investors as supplemental measures to compare our operating performance to those of other REITs. FFO, Core FFO and AFFO exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have a different cost basis. However, other REITs may use different methodologies to calculate FFO, Core FFO and AFFO and, accordingly, our FFO, Core FFO and AFFO may not be comparable to all other REITs. The items excluded from FFO, Core FFO and AFFO are significant components in understanding the Company’s financial performance.

FFO, Core FFO and AFFO are non-GAAP performance measures and (i) do not represent Cash Flow from Operations as defined by U.S. GAAP; (ii) should not be considered as an alternative to Net Income or Net Income Attributable to Common Shareholders as a measure of operating performance or to Cash Flows from Operating, Investing and Financing Activities; and (iii) are not an alternative to Cash Flows from Operating, Investing and Financing Activities as a measure of liquidity. FFO, Core FFO and AFFO, as calculated by the Company, may not be comparable to similarly titled measures reported by other REITs.

The following is a reconciliation of the Company’s U.S. GAAP Net Income to the Company’s FFO, Core FFO and AFFO for the three ~~and nine~~ months ended ~~June 30,~~December 31, 2017 and 2016:

	Three Months Ended						Nine Months Ended						Three Months Ended
	6/30/2017			6/30/2016			6/30/2017			6/30/2016			12/31/2017			12/31/2016
Net Income Attributable to Common Shareholders	$	5,217,411		$	6,079,537		$	16,216,147		$	15,846,623		$	13,313,455		$	6,156,161
Plus: Depreciation Expense (excluding Corporate Office Capitalized Costs)		7,278,976			6,066,012			21,332,662			17,390,417			8,444,507			6,953,780
Plus: Amortization of Intangible Assets		262,325			272,009			771,145			915,208			343,746			267,847
Plus: Amortization of Capitalized Lease Costs		214,990			198,887			632,707			579,643			220,002			205,442
Plus: Loss on Sale of Real Estate Investment		-0-			-0-			95,336			-0-
Less: (Gain) / Plus: Loss on Sale of Real Estate Investments														(5,387,886	)		95,336
FFO Attributable to Common Shareholders		12,973,702			12,616,445			39,047,997			34,731,891			16,933,824			13,678,566
Plus: Acquisition Costs		-0-			135,358			178,526			545,955			-0-			178,526
Plus: Redemption of Preferred Stock		2,467,165			-0-			2,467,165			-0-
Core FFO Attributable to Common Shareholders		15,440,867			12,751,803			41,693,688			35,277,846			16,933,824			13,857,092
Plus: Depreciation of Corporate Office Capitalized Costs														39,477			38,715
Plus: Stock Compensation Expense		174,709			99,760			441,054			306,688			130,763			100,155
Plus: Depreciation of Corporate Office Capitalized Costs		39,282			30,868			117,167			87,957
Plus: Amortization of Financing Costs		283,573			240,463			949,470			713,501			293,894			280,913
Plus: Non-recurring other expense		-0-			100,000			-0-			500,000
Less: Gain on Sale of Securities Transactions		(1,487,836	)		(272,067	)		(2,293,944	)		(1,159,409	)		(100,153	)		(806,108	)
Less: Lease Termination Income														(210,261	)		-0-
Less: Recurring Capital Expenditures														(219,246	)		(188,412	)
Less: Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment		(294,936	)		(350,217	)		(924,792	)		(1,172,053	)		(396,028	)		(343,239	)
Less: Recurring Capital Expenditures		(195,186	)		(169,492	)		(571,988	)		(653,544	)
AFFO Attributable to Common Shareholders	$	13,960,473		$	12,431,118		$	39,410,655		$	33,900,986		$	16,472,270		$	12,939,116

The following are the Cash Flows provided (used) by Operating, Investing and Financing Activities for the ~~nine~~three months ended ~~June 30,~~December 31, 2017 and 2016:

	Nine Months Ended						Three Months Ended
	6/30/2017			6/30/2016			12/31/2017			12/31/2016

Operating Activities	$	50,191,019		$	43,346,646		$	17,090,439		$	14,152,706
Investing Activities		(232,827,215	)		(169,804,819	)		(61,962,572	)		(55,150,303	)
Financing Activities		98,636,685			121,271,222			45,401,988			(24,029,305	)

This quarterly report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements provide the Company’s current expectations or forecasts of future events. Forward-looking statements include statements about the Company’s expectations, beliefs, intentions, plans, objectives, goals, strategies, future events, performance and underlying assumptions and other statements that are not historical facts. Forward-looking statements can be identified by their use of forward-looking words, such as “may,” “will,” “anticipate,” “expect,” “believe,” “intend,” “plan,” “should,” “seek” or comparable terms, or the negative use of those words, but the absence of these words does not necessarily mean that a statement is not forward-looking.

The forward-looking statements are based on the Company’s beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company. Forward-looking statements are not predictions of future events. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to the Company. Some of these factors are described below and are described under the above heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” above and the headings “Business”, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, ~~2016.~~2017. These and other risks, uncertainties and factors could cause the Company’s actual results to differ materially from those included in any forward-looking statements the Company makes. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for the Company to predict those events or how they may affect the Company. Except as required by law, the Company is not obligated to, and does not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Important factors that could cause actual results to differ materially from the Company’s expectations include, among others:

You should not place undue reliance on these forward-looking statements, as events described or implied in such statements may not occur. The Company undertakes no obligation to update or revise any forward-looking statements as a result of new information, future events or otherwise.

There have been no material changes to information required regarding quantitative and qualitative disclosures about market risk from the end of the preceding fiscal year to ~~June 30,~~December 31, 2017 (the date of this Quarterly Report on Form 10-Q).

The Company’s President and Chief Executive Officer (the Company’s principal executive officer) and the Company’s Chief Financial Officer (the Company’s principal financial and accounting officer) with the assistance of other members of the Company’s management, evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, the Company’s President and Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective as of the end of such period.

There has not been any change in the Company’s internal control over financial reporting during the quarter ended ~~June 30,~~December 31, 2017 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

~~OTHER INFORMATION~~

PART II:

OTHER INFORMATION

Item 1.	Legal Proceedings.– None

Item 1A.	Risk Factors. ~~There have been no material changes to information required regarding~~The following risk factors ~~from the end of the preceding year~~supplement and to the ~~date of this Quarterly~~extent inconsistent supersedes the risks discussed in Part I, Item 1A – “Risk Factors” in the Company’s Annual Report on Form ~~10-Q.~~10-K for the fiscal year ended September 30, 2017, or the 2017 Annual Report. In addition to the following risk factors and the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the factors discussed in Part I, Item 1A – “Risk Factors” in the ~~Company’s~~2017 Annual Report, ~~on Form 10-K for the fiscal year ended September 30, 2016,~~ which could materially affect the Company’s business, financial condition or future results. The risks described herein and in the ~~Company’s~~2017 Annual Report ~~on Form 10-K for the fiscal year ended September 30, 2016~~ are not the only risks facing the Company. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial also may materially adversely affect the Company’s business, financial condition and/or operating results.

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds. – None

Item 3.	Defaults Upon Senior Securities. – None

Item 4.	Mine Safety Disclosures.– None

Item 5.	Other ~~Information.~~Information - Risks Related to our Status as a REIT There is a risk of changes in the tax law applicable to real estate investment trusts. Because the IRS, the United States Treasury Department and Congress frequently review federal income tax legislation, we cannot predict whether, when or to what extent new federal tax laws, regulations, interpretations or rulings will be adopted. Any of such legislative action may prospectively or retroactively modify our tax treatment and, therefore, may adversely affect taxation of us and/or our investors. The recently enacted Tax Cuts and Jobs Act of 2017, or the TCJA, has significantly changed the U.S. federal income taxation of U.S. businesses and their owners, including REITs and their shareholders. Changes made by the TCJA that could affect us and our shareholders include:

	~~(a)~~●	~~Information Required~~Temporarily reducing individual U.S. federal income tax rates on ordinary income; the highest individual U.S. federal income tax rate has been reduced from 39.6% to ~~be Disclosed in a Report on Form 8-K, but not Reported – None~~37% for taxable years beginning after December 31, 2017 and before January 1, 2026;

	(b)●	~~Material Changes~~permanently eliminating the progressive corporate tax rate structure, with a maximum corporate tax rate of 35%, and replacing it with a flat corporate tax rate of 21%;

	●	permitting a deduction for certain pass-through business income, including dividends received by our shareholders from us that are not designated by us as capital gain dividends or qualified dividend income, which will allow individuals, trusts, and estates to deduct up to 20% of such amounts for taxable years beginning after December 31, 2017 and before January 1, 2026;

	●	reducing the highest rate of withholding with respect to our distributions to non-U.S. stockholders that are treated as attributable to gains from the sale or exchange of U.S. real property interests from 35% to 21%;

	●	limiting our deduction for net operating losses to 80% of REIT taxable income (prior to the ~~Procedures~~application of the dividends paid deduction);

	●	generally limiting the deduction for net business interest expense in excess of 30% of a business’s adjusted taxable income except for taxpayers that engage in certain real estate businesses and elect out of this rule (provided that such electing taxpayers must use an alternative depreciation system for certain property); and

	●	eliminating the corporate alternative minimum tax.

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Many of these changes are effective immediately, without any transition periods or grandfathering for existing transactions. The TCJA is unclear in many respects and could be subject to potential amendments and technical corrections, as well as interpretations and implementing regulations by the United States Treasury Department and the IRS, any of which ~~Security Holders~~could lessen or increase certain adverse impacts of the TCJA. In addition, it is unclear how these U.S. federal income tax changes will affect state and local taxation, which often uses federal taxable income as a starting point for computing state and local tax liabilities.

While some of the changes made by the TCJA may ~~Recommend Nominees~~adversely affect us, other changes may be beneficial on a going forward basis. We continue to ~~Board~~work with our tax advisors and auditors to determine the full impact that the recent tax legislation as a whole will have on us. You are urged to consult with your tax advisor with respect to the status of ~~Directors – None~~legislative, regulatory, judicial or administrative developments and proposals and their potential effect on an investment in our securities.

We may be adversely affected if we fail to qualify as a REIT.If we fail to qualify as a REIT, we will not be allowed to deduct distributions to shareholders in computing our taxable income and will be subject to federal income tax at regular corporate rates and possibly increased state and local taxes. In addition, we might be barred from qualification as a REIT for the four years following disqualification. The additional tax incurred at regular corporate rates would reduce significantly the cash flow available for distribution to shareholders and for debt service. Furthermore, we would no longer be required to make any distributions to our shareholders as a condition to REIT qualification. Any distributions to shareholders would be taxable as ordinary income to the extent of our current and accumulated earnings and profits, although such dividend distributions to non-corporate shareholders would be subject to a top federal income tax rate of 20% (and potentially a Medicare tax of 3.8%), provided applicable requirements of the Internal Revenue Code are satisfied. Furthermore, corporate shareholders may be eligible for the dividends received deduction on the distributions, subject to limitations under the Code. Additionally, if we fail to qualify as a REIT, non-corporate stockholders would no longer be able to deduct up to 20% of our dividends (other than capital gain dividends and dividends treated as qualified dividend income), as would otherwise generally be permitted for taxable years beginning after December 31, 2017 and before January 1, 2026.

Item 6.		Exhibits

~~10.1~~	~~Form of Stock Option Award Agreement.~~

~~10.2~~	~~Form of Restricted Stock Award Agreement.~~

31.1		Certification of Michael P. Landy, President and Chief Executive Officer of the Company, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (Filed herewith).

31.2		Certification of Kevin S. Miller, Chief Financial Officer of the Company, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (Filed herewith).

32		Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, signed by Michael P. Landy, President and Chief Executive Officer, and Kevin S. Miller, Chief Financial Officer (Furnished herewith).

101		The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended ~~June 30,~~December 31, 2017 formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Cash Flows and (v) the Notes to Consolidated Financial Statements. As provided in Rule 406T of Regulation S-T, this information is furnished and not filed for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934.

36 34

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SIGNATURES

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

		MONMOUTH REAL ESTATE
		INVESTMENT CORPORATION

Date:	~~August 9, 2017~~February 7, 2018	By:	/s/ Michael P. Landy
			Michael P. Landy, President and Chief Executive Officer,
			its principal executive officer

Date:	~~August 9, 2017~~February 7, 2018	By:	/s/ Kevin S. Miller
			Kevin S. Miller, Chief Financial Officer, its principal
			financial officer and principal accounting officer

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Maryland		22-1897375
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		identification number)

Juniper Business Plaza, 3499 Route 9 North, Suite 3-D, Freehold,		NJ 07728
(Address of Principal Executive Offices)		(Zip Code)

Large accelerated filer [X]		Accelerated filer [ ]
Non-accelerated filer [ ]	(Do not check if smaller reporting company)	Smaller Reporting Company [ ]
Emerging growth company [ ]

		Page No

PART I	FINANCIAL INFORMATION

Item 1 -	Financial Statements (Unaudited):	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Income	5
	Consolidated Statements of Comprehensive Income	7
	Consolidated Statements of Cash Flows	8
	Notes to Consolidated Financial Statements	9

Item 2 -	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	2322

Item 3 -	Quantitative and Qualitative Disclosures About Market Risk.	3532

Item 4 -	Controls and Procedures.	3532

PART II -	OTHER INFORMATION	33

Item 1 -	Legal Proceedings.	3633

Item 1A -	Risk Factors.	3633

Item 2 -	Unregistered Sales of Equity Securities and Use of Proceeds.	3633

Item 3 -	Defaults Upon Senior Securities.	3633

Item 4 -	Mine Safety Disclosures.	3633

Item 5 -	Other Information.	3633

Item 6 -	Exhibits.	3634

SIGNATURES		3735

	Three Months Ended						Nine Months Ended
	6/30/2017			6/30/2016			6/30/2017			6/30/2016

BASIC INCOME – PER SHARE
Net Income	$	0.16		$	0.12		$	0.42		$	0.35
Less: Preferred Dividends		(0.06	)		(0.03	)		(0.16	)		(0.10	)
Less: Redemption of Preferred Stock		(0.03	)		-0-			(0.03	)		-0-
Net Income Attributable to Common Shareholders - Basic	$	0.07		$	0.09		$	0.23		$	0.25

DILUTED INCOME – PER SHARE
Net Income	$	0.16		$	0.12		$	0.42		$	0.34
Less: Preferred Dividends		(0.06	)		(0.03	)		(0.16	)		(0.10	)
Less: Redemption of Preferred Stock		(0.03	)		-0-			(0.03	)		-0-
Net Income Attributable to Common Shareholders - Diluted	$	0.07		$	0.09		$	0.23		$	0.24

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic		72,881,974			66,337,101			71,264,806			64,613,953
Diluted		73,053,693			66,462,209			71,422,664			64,703,203

Date of Grant		Number of Employees		Number of Shares		Option Price		Expiration Date

	1/4/17		1		65,000	$	15.04	1/4/25
	12/9/16		10		215,000	$	14.24	12/9/24
	1/5/16		1		65,000	$	10.37	1/5/24

	Fiscal 2017			Fiscal 2016
Dividend yield		4.44	%		6.17	%
Expected volatility		18.84	%		20.20	%
Risk-free interest rate		2.26	%		2.09	%
Expected lives (years)		8			8
Estimated forfeitures		-0-			-0-

	Less than 12 Months					12 Months or Longer
			Unrealized					Unrealized
Description of Securities		Fair Value		Losses			Fair Value		Losses
Preferred stock	$	4,372,000	$	(435,781	)	$	-0-	$	-0-
Common stock		43,891,500		(13,494,567	)		-0-		-0-
Total	$	48,263,500	$	(13,930,348	)	$	-0-	$	-0-

Number of Individual Securities		Fair Value		Unrealized Losses			Range of Loss
	3	$	11,895,800	$	(567,137	)		1%-5%
	1		19,051,800		(2,572,813	)		12%
	4	$	30,947,600	$	(3,139,950	)

	6/30/2017						9/30/2016
	Amount			Weighted Average Interest Rate (1)			Amount			Weighted Average Interest Rate (1)
Fixed Rate Mortgage Notes Payable	$	561,736,464			4.21	%	$	483,748,153			4.48	%

Debt Issuance Costs	$	10,171,381					$	9,424,697
Accumulated Amortization of Debt Issuance Costs		(2,921,873	)					(3,152,554	)
Unamortized Debt Issuance Costs	$	7,249,508					$	6,272,143

Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs	$	554,486,956					$	477,476,010

	12/31/2017						9/30/2017
	Amount			Weighted Average Interest Rate (1)			Amount			Weighted Average Interest Rate (1)
Fixed Rate Mortgage Notes Payable	$	620,411,537			4.16	%	$	598,962,567			4.18	%

Debt Issuance Costs	$	10,878,623					$	10,597,083
Accumulated Amortization of Debt Issuance Costs		(3,118,521	)					(2,998,887	)
Unamortized Debt Issuance Costs	$	7,760,102					$	7,598,196

Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs	$	612,651,435					$	591,364,371

Property	Tenant	Square Feet		Former U.S. GAAP Straight- Line Rent PSF		Former Cash Rent PSF		Former Lease Expiration	Renewal U.S GAAP Straight- Line Rent PSF		Renewal Initial Cash Rent PSF		Renewal Lease Expiration	Renewal Term (years)		Tenant Improvement Cost PSF over Renewal Term (1)		Leasing Commissions Cost PSF over Renewal Term (1)

Ft. Myers, FL	FedEx Ground		87,500	$	4.95	$	4.95	10/31/16	$	4.95	$	4.95	6/30/17		0.7	$	-0-	$	-0-


Griffin, GA	Caterpillar		218,120	$	5.36	$	5.36	11/30/16	$	5.36	$	5.36	11/30/17		1.0	$	-0-	$	0.11
Elgin, IL	Joseph T. Ryerson		89,052		5.68		5.68	1/31/17		5.68		5.68	1/31/20		3.0		0.17		0.17
Newington, CT	Kellogg Sales Co.		54,812		6.00		6.00	2/28/17		6.00		6.00	2/29/20		3.0		0.30		0.24
Schaumburg, IL	FedEx Express		73,500		6.88		7.00	3/31/17		6.50		6.50	3/31/27		10.0		0.24		0.13
Tolleson, AZ	Western Container		283,358		4.33		4.59	4/30/17		4.78		4.33	4/30/27		10.0		0.58		0.14
Wheeling, IL	FedEx Ground		123,000		11.26		11.26	5/31/17		10.34		10.34	5/31/27		10.0		0.41		0.21
Punta Gorda, FL	FedEx Corp.		34,624		8.78		8.78	6/30/17		8.21		8.21	6/30/27		10.0		0.08		0.16
Cudahy, WI	FedEx Ground		139,564		6.45		6.45	6/30/17		5.92		5.92	6/30/27		10.0		0.36		0.12
St. Joseph, MO	Woodstream Corp.		256,000		3.50		3.50	9/30/17		3.57		3.50	9/30/21		4.0		0.01		0.11
	Total (2)		1,272,030

Weighted Average (2)				$	5.68	$	5.74		$	5.61	$	5.49			6.5	$	0.36	$	0.15

	(1)	Amount calculated based on the total cost divided by the square feet, divided by the renewal term.
	~~(2)~~	~~Total and Weighted Average amounts exclude the Ft. Myers, FL property.~~

Property	Mortgage amount		Maturity Date	Interest Rate
Hamburg (Buffalo), NY	$	23,500,000	11/1/2031		4.03	%
Ft. Myers, FL		14,500,000	1/1/2032		3.97	%
Walker (Grand Rapids), MI		20,875,000	5/1/2032		3.86	%
Mesquite (Dallas), TX		32,900,000	7/1/2032		3.60	%
Aiken (Augusta, GA), SC		15,350,000	7/1/2032		4.20	%
Homestead (Miami), FL		24,800,000	7/1/2032		3.60	%
Oklahoma City, OK		6,000,000	7/1/2029		4.125	%

	●	the ability of the Company’s tenants to make payments under their respective ~~leases, its~~leases;
	●	the Company’s reliance on certain major ~~tenants and~~ tenants;
	●	the Company’s ability to re-lease properties that are currently vacant or that become vacant;

	●	the Company’s ability to obtain suitable tenants for its properties;

	●	changes in real estate market conditions, economic conditions in the industrial sector and the market in which the Company’s properties are located and general economic conditions;

	●	the inherent risks associated with owning real estate, including local real estate market conditions, governing laws and regulations and illiquidity of real estate investments;

	●	the Company’s ability to acquire, finance and sell properties on attractive terms;

	●	the Company’s ability to repay debt financing obligations;

	●	the Company’s ability to refinance amounts outstanding under its mortgages and credit facilities at maturity on terms favorable to us, or at all;

	●	the loss of any member of the Company’s management team;

	●	the Company’s ability to comply with debt covenants;

	●	the Company’s ability to integrate acquired properties and operations into existing operations;

	●	continued availability of proceeds from issuances of the Company’s debt or equity securities;

	●	the availability of other debt and equity financing alternatives;

	●	market conditions affecting the Company’s investment in marketable securities of other REIT’s;

	●	changes in interest rates under the Company’s current credit facility and under any additional variable rate debt arrangements that the Company may enter into in the future;

	●	the Company’s ability to successfully implement the Company’s selective acquisition strategy;

	●	the Company’s ability to maintain internal controls and procedures to ensure all transactions are accounted for properly, all relevant disclosures and filings are timely made in accordance with all rules and regulations, and any potential fraud or embezzlement is thwarted or detected;

	●	changes in federal or state tax rules or regulations that could have adverse tax consequences;

	●	declines in the market prices of the Company’s investment securities; and

	●	the Company’s ability to qualify as a REIT for federal income tax purposes.