Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2019 | May 01, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | MONMOUTH REAL ESTATE INVESTMENT CORP | |
Entity Central Index Key | 0000067625 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business Flag | false | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 94,188,682 | |
Trading Symbol | MNR | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 |
Real Estate Investments: | ||
Land | $ 236,497 | $ 224,719 |
Buildings and Improvements | 1,600,972 | 1,494,859 |
Total Real Estate Investments | 1,837,469 | 1,719,578 |
Accumulated Depreciation | (228,092) | (207,065) |
Real Estate Investments | 1,609,377 | 1,512,513 |
Cash and Cash Equivalents | 16,358 | 9,324 |
Securities Available for Sale at Fair Value | 177,359 | 154,921 |
Tenant and Other Receivables | 1,702 | 1,249 |
Deferred Rent Receivable | 10,373 | 9,656 |
Prepaid Expenses | 10,231 | 6,190 |
Intangible Assets, net of Accumulated Amortization of $14,705 and $13,700, respectively | 15,471 | 14,590 |
Capitalized Lease Costs, net of Accumulated Amortization of $3,651 and $3,271, respectively | 4,839 | 5,232 |
Financing Costs, net of Accumulated Amortization of $1,183 and $995, respectively | 313 | 500 |
Other Assets | 4,031 | 4,203 |
TOTAL ASSETS | 1,850,054 | 1,718,378 |
Liabilities: | ||
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs | 754,123 | 711,546 |
Loans Payable | 129,759 | 186,609 |
Accounts Payable and Accrued Expenses | 2,654 | 5,891 |
Other Liabilities | 20,406 | 16,426 |
Total Liabilities | 906,942 | 920,472 |
COMMITMENTS AND CONTINGENCIES | ||
Shareholders' Equity: | ||
6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: 16,400 Shares Authorized as of March 31, 2019 and September 30, 2018; 11,969 and 11,488 Shares Issued and Outstanding as of March 31, 2019 and September 30, 2018, respectively | 299,230 | 287,200 |
Common Stock, $0.01 Par Value Per Share: 188,040 Shares Authorized as of March 31, 2019 and September 30, 2018; 93,869 and 81,503 Shares Issued and Outstanding as of March 31, 2019 and September 30, 2018, respectively | 939 | 815 |
Excess Stock, $0.01 Par Value Per Share: 200,000 Shares Authorized as of March 31, 2019 and September 30, 2018; No Shares Issued or Outstanding as of March 31, 2019 and September 30, 2018 | 0 | 0 |
Additional Paid-In Capital | 642,943 | 534,635 |
Accumulated Other Comprehensive Loss | 0 | (24,744) |
Undistributed Income | 0 | 0 |
Total Shareholders' Equity | 943,112 | 797,906 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 1,850,054 | $ 1,718,378 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 |
Accumulated amortization of intangible assets | $ 14,705 | $ 13,700 |
Accumulated amortization of capitalized lease costs | 3,651 | 3,271 |
Accumulated amortization of financing costs | $ 1,183 | $ 995 |
Common Stock [Member] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 188,040 | 188,040 |
Common Stock, shares issued | 93,869 | 81,503 |
Common Stock, shares outstanding | 93,869 | 81,503 |
Excess Stock [Member] | ||
Excess Stock, par value | $ 0.01 | $ 0.01 |
Excess Stock , shares authorized | 200,000 | 200,000 |
Excess Stock , shares issued | 0 | 0 |
Excess Stock , shares outstanding | 0 | 0 |
Series C Preferred Stock [Member] | ||
Cumulative redeemable preferred stock, dividend rate | 6.125% | 6.125% |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 16,400 | 16,400 |
Preferred stock, shares issued | 11,969 | 11,488 |
Preferred stock, shares outstanding | 11,969 | 11,488 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
INCOME: | ||||
Rental Revenue | $ 32,934 | $ 28,610 | $ 65,551 | $ 56,302 |
Reimbursement Revenue | 6,372 | 5,734 | 12,902 | 11,506 |
Lease Termination Income | 0 | 0 | 0 | 210 |
TOTAL INCOME | 39,306 | 34,344 | 78,453 | 68,018 |
EXPENSES: | ||||
Real Estate Taxes | 5,088 | 4,502 | 10,052 | 9,087 |
Operating Expenses | 1,673 | 1,476 | 3,537 | 2,913 |
General & Administrative Expenses | 2,252 | 2,218 | 4,069 | 4,165 |
Depreciation | 10,756 | 8,858 | 21,234 | 17,342 |
Amortization of Capitalized Lease Costs and Intangible Assets | 721 | 589 | 1,423 | 1,127 |
TOTAL EXPENSES | 20,490 | 17,643 | 40,315 | 34,634 |
OTHER INCOME (EXPENSE): | ||||
Dividend Income | 3,515 | 2,888 | 7,882 | 5,752 |
Gain on Sale of Securities Transactions | 0 | 11 | 0 | 111 |
Unrealized Holding Gains (Losses) Arising During the Periods | 15,568 | 0 | (27,059) | 0 |
Interest Expense, including Amortization of Financing Costs | (9,598) | (7,955) | (18,603) | (15,360) |
TOTAL OTHER INCOME (EXPENSE) | 9,485 | (5,056) | (37,780) | (9,497) |
INCOME FROM OPERATIONS | 28,301 | 11,645 | 358 | 23,887 |
Gain on Sale of Real Estate Investments | 0 | 0 | 0 | 5,388 |
NET INCOME | 28,301 | 11,645 | 358 | 29,275 |
Less: Preferred Dividends | 4,480 | 4,248 | 8,901 | 8,565 |
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ 23,821 | $ 7,397 | $ (8,543) | $ 20,710 |
BASIC INCOME (LOSS) - PER SHARE | ||||
Net Income | $ 0.30 | $ 0.15 | $ 0 | $ 0.38 |
Less: Preferred Dividends | (0.04) | (0.05) | (0.09) | (0.11) |
Net Income (Loss) Attributable to Common Shareholders - Basic | 0.26 | 0.10 | (0.09) | 0.27 |
DILUTED INCOME (LOSS) - PER SHARE | ||||
Net Income | 0.30 | 0.15 | 0 | 0.38 |
Less: Preferred Dividends | (0.04) | (0.05) | (0.09) | (0.11) |
Net Income (Loss) Attributable to Common Shareholders - Diluted | $ 0.26 | $ 0.10 | $ (0.09) | $ 0.27 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | ||||
Basic | 92,978 | 77,992 | 91,728 | 77,175 |
Diluted | 93,059 | 78,156 | 91,831 | 77,362 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 28,301 | $ 11,645 | $ 358 | $ 29,275 |
Other Comprehensive Income (Loss): | ||||
Unrealized Holding Losses Arising During the Periods | 0 | (26,971) | 0 | (37,584) |
Reclassification Adjustment for Net Gains Realized in Income | 0 | (11) | 0 | (111) |
TOTAL COMPREHENSIVE INCOME (LOSS) | 28,301 | (15,337) | 358 | (8,420) |
Less: Preferred Dividends | 4,480 | 4,248 | 8,901 | 8,565 |
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ 23,821 | $ (19,585) | $ (8,543) | $ (16,985) |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Series C Preferred Stock [Member] | Additional Paid in Capital [Member] | Undistributed Income (Loss) [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total | |
Balance Beginning at Sep. 30, 2017 | $ 756 | $ 245,986 | $ 459,553 | $ 0 | $ 6,570 | $ 712,865 | |
Shares Issued in Connection with the DRIP | [1] | 32 | 0 | 49,011 | 0 | 0 | 49,043 |
Shares Issued in Connection with At-The-Market Sales Agreement Program of 6.125% Series C Preferred Stock, net of offering costs | 0 | 31,398 | (456) | 0 | 0 | 30,942 | |
Shares Issued Through the Exercise of Stock Options | 0 | 0 | 570 | 0 | 0 | 570 | |
Shares Issued Through Restricted Stock Awards | 0 | 0 | 0 | 0 | 0 | 0 | |
Stock Compensation Expense | 0 | 0 | 242 | 0 | 0 | 242 | |
Distributions To Common Shareholders | 0 | 0 | (5,610) | (20,710) | 0 | (26,320) | |
Net Income | 0 | 0 | 0 | 29,275 | 0 | 29,275 | |
Preferred Dividends | 0 | 0 | 0 | (8,565) | 0 | (8,565) | |
Change in Unrealized Net Holding Gain (Loss) on Securities Available for Sale, Net of Reclassification Adjustment | 0 | 0 | 0 | 0 | (37,695) | (37,695) | |
Balance Ending at Mar. 31, 2018 | 788 | 277,384 | 503,310 | 0 | (31,125) | 750,357 | |
Balance Beginning at Dec. 31, 2017 | 772 | 271,984 | 485,470 | 0 | (4,143) | 754,083 | |
Shares Issued in Connection with the DRIP | [1] | 16 | 0 | 23,495 | 0 | 0 | 23,511 |
Shares Issued in Connection with At-The-Market Sales Agreement Program of 6.125% Series C Preferred Stock, net of offering costs | 0 | 5,400 | (145) | 0 | 0 | 5,255 | |
Shares Issued Through the Exercise of Stock Options | 0 | 0 | 285 | 0 | 0 | 285 | |
Shares Issued Through Restricted Stock Awards | 0 | 0 | 0 | 0 | 0 | 0 | |
Stock Compensation Expense | 0 | 0 | 111 | 0 | 0 | 111 | |
Distributions To Common Shareholders | 0 | 0 | (5,906) | (7,397) | 0 | (13,303) | |
Net Income | 0 | 0 | 0 | 11,645 | 0 | 11,645 | |
Preferred Dividends | 0 | 0 | 0 | (4,248) | 0 | (4,248) | |
Change in Unrealized Net Holding Gain (Loss) on Securities Available for Sale, Net of Reclassification Adjustment | 0 | 0 | 0 | 0 | (26,982) | (26,982) | |
Balance Ending at Mar. 31, 2018 | 788 | 277,384 | 503,310 | 0 | (31,125) | 750,357 | |
Balance Beginning at Sep. 30, 2018 | 815 | 287,200 | 534,635 | 0 | (24,744) | 797,906 | |
Shares Issued in Connection with the DRIP | [1] | 31 | 0 | 40,582 | 0 | 0 | 40,613 |
Shares Issued in Connection with At-The-Market Sales Agreement Program of 6.125% Series C Preferred Stock, net of offering costs | 0 | 12,030 | (748) | 0 | 0 | 11,282 | |
Shares Issued Through the Exercise of Stock Options | 1 | 0 | 566 | 0 | 0 | 567 | |
Shares Issued Through Restricted Stock Awards | 0 | 0 | 0 | 0 | 0 | 0 | |
Stock Compensation Expense | 0 | 0 | 344 | 0 | 0 | 344 | |
Distributions To Common Shareholders | 0 | 0 | (64,682) | 33,287 | 0 | (31,395) | |
Net Income | 0 | 0 | 0 | 358 | 0 | 358 | |
Preferred Dividends | 0 | 0 | 0 | (8,901) | 0 | (8,901) | |
Impact of Adoption of Accounting Standards Update 2016-01 | 0 | 0 | 0 | (24,744) | 24,744 | 0 | |
Shares Issued in Connection with Underwritten Public Offering of Common Stock, net of offering costs | 92 | 0 | 132,246 | 0 | 0 | 132,338 | |
Balance Ending at Mar. 31, 2019 | 939 | 299,230 | 642,943 | 0 | 0 | 943,112 | |
Balance Beginning at Dec. 31, 2018 | 923 | 288,311 | 616,322 | 0 | 0 | 905,556 | |
Shares Issued in Connection with the DRIP | [1] | 15 | 0 | 18,488 | 0 | 0 | 18,503 |
Shares Issued in Connection with At-The-Market Sales Agreement Program of 6.125% Series C Preferred Stock, net of offering costs | 0 | 10,919 | (643) | 0 | 0 | 10,276 | |
Shares Issued Through the Exercise of Stock Options | 1 | 0 | 566 | 0 | 0 | 567 | |
Shares Issued Through Restricted Stock Awards | 0 | 0 | 0 | 0 | 0 | 0 | |
Stock Compensation Expense | 0 | 0 | 215 | 0 | 0 | 215 | |
Distributions To Common Shareholders | 0 | 0 | 7,995 | (23,821) | 0 | (15,826) | |
Net Income | 0 | 0 | 0 | 28,301 | 0 | 28,301 | |
Preferred Dividends | 0 | 0 | 0 | (4,480) | 0 | (4,480) | |
Balance Ending at Mar. 31, 2019 | $ 939 | $ 299,230 | $ 642,943 | $ 0 | $ 0 | $ 943,112 | |
[1] | Dividend Reinvestment and Stock Purchase Plan |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Distributions to common shareholders, per share | $ 0.17 | $ 0.17 | $ 0.34 | $ 0.34 |
Preferred dividends, per share | $ 0.3828125 | $ 0.3828125 | $ 0.765625 | $ 0.765625 |
Series C Preferred Stock [Member] | At-The-Market Offerings [Member] | ||||
Preferred stock, dividend rate | 6.125% | 6.125% | 6.125% | 6.125% |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net Income | $ 358 | $ 29,275 |
Noncash Items Included in Net Income: | ||
Depreciation & Amortization | 23,294 | 19,065 |
Deferred Straight Line Rent | (825) | (756) |
Stock Compensation Expense | 344 | 242 |
Unrealized Holding Losses Arising During the Periods | 27,059 | 0 |
Gain on Sale of Securities Transactions | 0 | (111) |
Gain on Sale of Real Estate Investments | 0 | (5,388) |
Changes In: | ||
Tenant & Other Receivables | (401) | 851 |
Prepaid Expenses | (4,041) | (3,905) |
Other Assets & Capitalized Lease Costs | 1,349 | 20 |
Accounts Payable, Accrued Expenses & Other Liabilities | 3,511 | 3,545 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 50,648 | 42,838 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of Real Estate & Intangible Assets | (113,406) | (110,046) |
Capital Improvements | (9,205) | (2,310) |
Proceeds from Sale of Real Estate Investments | 0 | 10,500 |
Return of Deposits on Real Estate | 200 | 450 |
Deposits Paid on Acquisitions of Real Estate | (1,550) | (1,200) |
Proceeds from Sale of Securities Available for Sale | 0 | 2,619 |
Purchase of Securities Available for Sale | (49,497) | (61,069) |
NET CASH USED IN INVESTING ACTIVITIES | (173,458) | (161,056) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Net Draws (Repayments) on Loans Payable | (56,850) | 34,250 |
Proceeds from Fixed Rate Mortgage Notes Payable | 72,500 | 67,100 |
Principal Payments on Fixed Rate Mortgage Notes Payable | (29,929) | (26,226) |
Financing Costs Paid on Debt | (443) | (596) |
Proceeds from the Exercise of Stock Options | 567 | 570 |
Proceeds from Underwritten Public Offering of Common Stock, net of offering costs | 132,338 | 0 |
Proceeds from At-The-Market Sales Agreement Program of 6.125% Series C Preferred Stock, net of offering costs | 11,282 | 30,942 |
Proceeds from Issuance of Common Stock in the DRIP, net of Dividend Reinvestments | 32,147 | 42,997 |
Preferred Dividends Paid | (8,839) | (8,301) |
Common Dividends Paid, net of Reinvestments | (22,929) | (20,274) |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 129,844 | 120,462 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 7,034 | 2,244 |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 9,324 | 10,226 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | $ 16,358 | $ 12,470 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Series C Preferred Stock [Member] | At-The-Market Offerings [Member] | ||||
Preferred stock, dividend rate | 6.125% | 6.125% | 6.125% | 6.125% |
Organization and Accounting Pol
Organization and Accounting Policies | 6 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Accounting Policies | NOTE 1 – ORGANIZATION AND ACCOUNTING POLICIES Monmouth Real Estate Investment Corporation, a Maryland corporation, together with its consolidated subsidiaries (we, our, us, the Company or MREIC), operates as a real estate investment trust (REIT) deriving its income primarily from real estate rental operations. We were founded in 1968 and are one of the oldest public equity REITs in the world. As of March 31, 2019, we owned 113 properties with total square footage of 21.8 million, which was 98.9% occupied, as compared to 111 properties with total square footage of 21.2 million, which was 99.6% occupied as of September 30, 2018. These properties are located in 30 states: Alabama, Arizona, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Washington and Wisconsin. As of the quarter ended March 31, 2019, our weighted average lease maturity was 8.0 years and our annualized average base rent per occupied square foot was $6.23. As of March 31, 2019, the weighted average building age, based on the square footage of our buildings, was 8.8 years. We also own a portfolio of REIT investment securities, which we generally limit to no more than approximately 10% of our undepreciated assets (which is our total assets, excluding accumulated depreciation). Total assets excluding accumulated depreciation were $2.1 billion as of March 31, 2019. We held $177.4 million in marketable REIT securities as of March 31, 2019, representing 8.5% of our undepreciated assets. We have elected to be taxed as a REIT under Sections 856-860 of the Internal Revenue Code of 1986, as amended (the Code), and we intend to maintain our qualification as a REIT in the future. As a qualified REIT, with limited exceptions, we will not be taxed under Federal and certain state income tax laws at the corporate level on taxable income that we distribute to our shareholders. For special tax provisions applicable to REITs, refer to Sections 856-860 of the Code. We are subject to franchise taxes in several of the states in which we own properties. In December 2017, as part of the Tax Cuts and Jobs Act of 2017 (the TCJA), 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 TCJA, subject to certain income limitations, an individual taxpayer and estates and trusts 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 or qualified dividend income. The interim Consolidated Financial Statements furnished herein have been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (U.S. GAAP) applicable to interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending September 30, 2019. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in our annual report on Form 10-K for the fiscal year ended September 30, 2018. Use of Estimates In preparing the financial statements in accordance with U.S. GAAP, we are required to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods and related disclosure of contingent assets and liabilities. Actual results could differ from these estimates and assumptions. Reclassification Certain prior period amounts in the accompanying Consolidated Financial Statements have been reclassified to conform to the current period’s presentation. Stock Compensation Plan We account for awards of stock, 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 stock awards and restricted stock awards is equal to the fair value of our stock on the grant date. The amortization of compensation costs for the awards of stock, stock option grants and restricted stock are included in General and Administrative Expenses in the accompanying Consolidated Statements of Income (Loss) and amounted to $215,000 and $111,000 for the three months ended March 31, 2019 and 2018, respectively and amounted to $344,000 and $242,000 for the six months ended March 31, 2019 and 2018, respectively. During the six months ended March 31, 2019 and 2018, the following stock options, which vest one year after grant date, were granted under our Stock Option Plan: Date of Grant Number of Employees Number of Shares (in thousands) Option Price Expiration Date 1/10/19 1 65 $ 12.86 1/10/27 12/10/18 12 385 $ 13.64 12/10/26 1/3/18 1 65 $ 17.80 1/3/26 The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated: Fiscal 2019 Fiscal 2018 Dividend yield 5.03 % 3.82 % Expected volatility 17.17 % 16.45 % Risk-free interest rate 2.88 % 2.37 % Expected lives (years) 8 8 Estimated forfeitures -0- -0- The weighted-average fair value of options granted during the six months ended March 31, 2019 and 2018 was $1.17 and $1.84 per share subject to the option. During the six months ended March 31, 2019 and 2018, 25,000 and 12,500 shares of restricted stock were granted, respectively. During the six months ended March 31, 2019, one participant exercised options to purchase 65,000 shares of common stock at a price of $8.72 per share for total proceeds of $567,000. During the six months ended March 31, 2018, three participants exercised options awarded under the Plan to purchase an aggregate of 40,000 shares of common stock at a weighted average exercise price of $14.24 per share for total proceeds of $570,000. As of March 31, 2019, a total of 1.2 million shares were available for grant as stock options, as restricted stock, or other equity based awards, plus any shares subject to outstanding options that expire or are forfeited without being exercised. As of March 31, 2019, there were outstanding options to purchase 1.1 million shares with an aggregate intrinsic value of $1.0 million. Recent Accounting Pronouncements In January 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (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 became effective for our fiscal year beginning October 1, 2018. The most significant change for us, once ASU 2016-01 was adopted, was the accounting treatment for our investments in marketable securities that are classified as available for sale. The accounting treatment used for our Consolidated Financial Statements through Fiscal 2018 was that our investments in marketable securities, classified as available for sale, were carried at fair value, with net unrealized holding gains and losses being excluded from earnings and reported as a separate component of Shareholders’ Equity until realized and the change in net unrealized holding gains and losses being reflected as comprehensive income (loss). Under ASU 2016-01, effective October 1, 2018, these marketable securities continue to be measured at fair value, however, the changes in net unrealized holding gains and losses are now recognized through net income on our Consolidated Statements of Income (Loss). On October 1, 2018, unrealized net holding losses of $24.7 million were reclassed to beginning Undistributed Income (Loss) to recognize the unrealized losses previously recorded in “accumulated other comprehensive income” on our consolidated balance sheets. 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 lessee and 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. The most significant changes related to lessor accounting under ASU 2016-02 include bifurcating revenue into lease and non-lease components and the new standard’s narrow definition of initial direct costs for leases. Since our revenue is primarily derived from leasing activities from long-term net-leases and since we currently do not capitalize indirect costs for leases, we believe that we will continue to account for our leases and related leasing costs in substantially the same manner as we currently do once the adoption of the ASU 2016-02 becomes effective. In addition, the guidance requires lessees to recognize assets and liabilities for operating leases with lease terms greater than twelve months on the balance sheet. Therefore, the most significant impact for us may be the recognition of our corporate office lease, while accounting where we are the lessor will remain substantially the same. Upon adoption, we may recognize an asset and lease liability equal to the present value of the minimum lease payments due under our corporate office lease. In July 2018, the FASB issued ASU 2018-10, “Codification Improvements to Topic 842, Leases”. The amendment in ASU 2018-10 affects narrow aspects of the guidance issued earlier in ASU 2016-02 by removing certain inconsistencies and providing additional clarification related to the guidance issued earlier. We are currently evaluating the potential impact this standard may have on our consolidated financial statements and expect that the adoption of this standard will not have a significant impact on our consolidated financial statements and related disclosures. In December 2018, the FASB issued ASU 2018-20 “Narrow-Scope Improvements for Lessors”. Similar to ASU 2018-10, 2018-20 affects narrow aspects of the guidance issued earlier in ASU 2016-02 as well by providing additional clarification related to the guidance issued earlier. The most significant changes related to lessor accounting under ASU 2018-20 is the clarification of how to treat payments made by a lessee directly to a third party, such as real estate taxes paid by the lessee directly to the taxing authority, whereby items paid directly by the lessee to a third party should not be reflected in the lessors income statement and, thus, should not be bifurcated and included in revenue and operating expenses. A majority of our reimbursable expenses are paid by us and are billed back to our lessees. Therefore, these reimbursable expenses will continue to be presented separately by bifurcating these revenue and expense items in our Consolidated Statements of Income. We are currently evaluating the potential impact this standard may have on our consolidated financial statements and expect that the adoption of this standard will not have a significant impact on our consolidated financial statements and related disclosures, other than any of these types of payments made by a lessee directly to a third party will no longer be presented on a gross basis in our Consolidated Statements of Income, which will have a net zero effect on our Net Income Attributable to Common Shareholders. ASU 2016-02, 2018-10 and 2018-20 are effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2018. Therefore, we expect to adopt these standards effective October 1, 2019. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers”. The FASB issued further guidance in ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, that provides clarifying guidance in certain narrow areas and adds some practical expedients. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The effective date of ASU 2014-09 was extended by one year by ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”. The new standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017. Therefore, we adopted the standard effective October 1, 2018. Our revenue is primarily derived from leasing activities and historically our property dispositions have been cash sales with no contingencies and no future involvement in the property. Since this standard applies to all contracts with customers except those that are within the scope of other guidance, such as leases, the adoption of this standard did not have a significant impact on our consolidated financial statements and related disclosures. We do not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying Consolidated Financial Statements. Segment Reporting & Financial Information Our primary business is the ownership and management of real estate properties. We invest in well-located, modern, single-tenant, industrial buildings leased primarily to investment-grade tenants or their subsidiaries on long-term net-leases. We review operating and financial information for each property on an individual basis and, therefore, each property represents an individual operating segment. We evaluate financial performance using Net Operating Income (NOI) from property operations. NOI is a non-GAAP financial measure, which we define as recurring Rental and Reimbursement Revenue, less Real Estate Taxes and Operating Expenses, such as insurance, utilities and repairs and maintenance. We have aggregated the properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities, including the fact that they are operated as industrial properties subject to long-term net-leases primarily to investment-grade tenants or their subsidiaries. |
Net Income Per Share
Net Income Per Share | 6 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | NOTE 2 – NET INCOME PER SHARE Basic Net Income per Common Share is calculated by dividing Net Income Attributable to Common Shareholders by the weighted-average number of common shares outstanding during the period. Diluted Net Income per Common Share is calculated by dividing Net Income Attributable to Common Shareholders by the weighted-average number of common shares outstanding for the period and, when dilutive, the potential net shares that would be issued upon exercise of stock options pursuant to the treasury stock method. In periods with a net loss, the basic loss per share equals the diluted loss per share as all common stock equivalents are excluded from the per share calculation because they are anti-dilutive. In addition, common stock equivalents of 81,000 and 164,000 shares are included in the diluted weighted average shares outstanding for the three months ended March 31, 2019 and 2018, respectively, common stock equivalents of 103,000 and 187,000 shares are included in the diluted weighted average shares outstanding for the six months ended March 31, 2019 and 2018. For the diluted weighted average shares outstanding for the three months ended March 31, 2019 and 2018, 690,000 and 65,000 options to purchase shares of common stock were antidilutive. For the diluted weighted average shares outstanding for the six months ended March 31, 2019 and 2018, 305,000 and 65,000 options to purchase shares of common stock, respectively, were antidilutive. |
Real Estate Investments
Real Estate Investments | 6 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Real Estate Investments | NOTE 3 – REAL ESTATE INVESTMENTS On October 19, 2018, we purchased a newly constructed 347,000 square foot industrial building, situated on 62.0 acres, located in Trenton, NJ. The building is 100% net-leased to FedEx Ground Package System, Inc. for 15 years through June 2032. The purchase price was $85.2 million. We obtained a 15 year, fully-amortizing mortgage loan of $55.0 million at a fixed interest rate of 4.13%. Annual rental revenue over the remaining term of the lease averages $5.3 million. On November 30, 2018, we purchased a newly constructed 127,000 square foot industrial building, situated on 29.4 acres, located in Savannah, GA. The building is 100% net-leased to FedEx Ground Package System, Inc. for 10 years through October 2028. The purchase price was $27.8 million. We obtained a 15 year, fully-amortizing mortgage loan of $17.5 million at a fixed interest rate of 4.40%. Annual rental revenue over the remaining term of the lease averages $1.8 million. FedEx Ground Package System, Inc.’s ultimate parent, FedEx Corporation 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 We evaluated the property acquisitions which took place during the six months ended March 31, 2019, to determine whether an integrated set of assets and activities meets the definition of a business, pursuant to ASU 2017-01. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions. Accordingly, we accounted for the two properties purchased during fiscal 2019 as asset acquisitions and allocated the total cash consideration, including transaction costs of approximately $324,000, to the individual assets acquired on a relative fair value basis. There were no liabilities assumed in these acquisitions. The financial information set forth below summarizes our purchase price allocation for these two properties acquired during the six months ended March 31, 2019 that are accounted for as asset acquisitions (in thousands): Land $ 11,778 Building 99,741 In-Place Leases 1,886 The following table summarizes the operating results included in our consolidated statements of income for the three and six months ended March 31, 2019 for the two properties acquired during the six months ended March 31, 2019 (in thousands): Three Months Ended 3/31/2019 Six Months Ended 3/31/2019 Rental Revenues $ 1,775 $ 3,096 Net Income Attributable to Common Shareholders 326 800 Expansions During the quarter ended March 31, 2019, we completed a 155,000 square foot building expansion at our property located in Monroe (Cincinnati), OH for a total project cost of $8.6 million. The expansion resulted in a new 15 year lease which extended the prior lease expiration date from February 2030 to February 2034. The expansion also resulted in an increase in initial annual rent effective March 1, 2019 of $821,000 from $980,000, or $4.22 per square foot, to $1.8 million, or $4.65 per square foot. In addition, the annual rent will increase by 2% per annum, resulting in an average annualized rent of $2.1 million over the 15 years. We obtained a commitment to enter into a 10.8 year, fully-amortizing second mortgage loan of $7.0 million at a fixed interest rate of 3.85%. The maturity of the second mortgage loan will coincide with the maturity of the property’s first fully-amortizing mortgage loan which is at a fixed interest rate of 3.77% and has a principal balance of $6.9 million as of the quarter end. Dispositions We have not had any dispositions thus far in fiscal 2019. During fiscal 2018, there were two leases that were set to expire with Kellogg Sales Company (Kellogg) at our 65,000 square foot facility in Kansas City, MO through July 31, 2018 and at our 50,000 square foot facility in Orangeburg, NY through February 28, 2018. Kellogg informed us that they would not be renewing these leases. On December 18, 2017, we sold our property, located in Kansas City, MO for $4.9 million, with net sale proceeds of $4.6 million and, on December 22, 2017, we sold our property, located in Orangeburg, NY for $6.2 million, with net sale proceeds of $5.9 million. In conjunction with the sale of these two properties, we simultaneously entered into a lease termination agreement for each property whereby we received a termination fee from Kellogg totaling approximately $210,000 which represents a weighted average of 80% of the then remaining rent due under each respective lease. Additionally, Real Estate Held for Sale at March 31, 2018 consisted of two properties that sold during the third quarter of fiscal 2018. The two properties consisted of an 88,000 square foot facility located in Ft. Myers, FL and a 68,000 square foot facility located in Colorado Springs, CO. Since the sale of these two properties during the first half of fiscal 2018 as well as the two properties that were classified as Real Estate Held for Sale did not represent a strategic shift that had a major effect on our operations and financial results, the operations generated from these properties were not included in Discontinued Operations. The following table summarizes the operations of the two properties that were sold during the prior year, prior to their sales, and the two properties that were classified as Real Estate Held for Sale that are included in the accompanying Consolidated Statements of Income for the three and six months ended March 31, 2018 (in thousands). Three Months Ended Six Months Ended 3/31/2019 3/31/2018 3/31/2019 3/31/2018 Rental and Reimbursement Revenue $ -0- $ 278 $ -0- $ 857 Lease Termination Income -0- -0- -0- 210 Real Estate Taxes -0- (17 ) -0- (228 ) Operating Expenses -0- (36 ) -0- (85 ) Depreciation & Amortization -0- (5 ) -0- (63 ) Interest Expense, including Amortization of Financing Costs -0- (12 ) -0- (26 ) Income from Operations -0- 208 -0- 665 Gain on Sale of Real Estate Investments -0- -0- -0- 5,388 Net Income $ -0- $ 208 $ -0- $ 6,053 Pro forma information The following unaudited pro forma condensed financial information has been prepared utilizing our historical financial statements and the effect of additional revenue and expenses generated from property acquired and expanded during fiscal 2019 to date, and during fiscal 2018, assuming that the acquisitions and completed expansions had occurred as of October 1, 2017, after giving effect to certain adjustments including: (a) Rental Revenue adjustments resulting from the straight-lining of scheduled rent increases, (b) Interest Expense resulting from the assumed increase in Fixed Rate Mortgage Notes Payable and Loans Payable related to the new acquisitions, and (c) Depreciation Expense related to the new acquisitions. In addition, Net Income (Loss) Attributable to Common Shareholders excludes the operations, including the exclusion of the related realized gain, of the four properties sold during fiscal 2018. Furthermore, the net proceeds raised from our public offering of 9.2 million shares of our Common Stock in October 2018 and from our 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 pro forma Basic and Diluted Net Income (Loss) per Share Attributable to Common Shareholders has been adjusted to account for the increase in shares raised through the public offering and the DRIP, as if all the shares raised had occurred on October 1, 2017. Additionally, the net proceeds raised from the issuance of our 6.125% Series C Cumulative Redeemable Preferred Stock through our At-The-Market Sales Agreement Program were used to help fund property acquisitions and, therefore, the pro forma preferred dividend has been adjusted to account for its effect on pro forma Net Income (Loss) Attributable to Common Shareholders as if all the preferred stock issuances had occurred on October 1, 2017. The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisitions and expansions reflected herein been consummated on the dates indicated or that will be achieved in the future. Three Months Ended ( in thousands, except per share amounts 3/31/2019 3/31/2018 As Reported Pro-forma As Reported Pro-forma Rental Revenue $ 32,934 $ 33,074 $ 28,610 $ 33,347 Net Income (Loss) Attributable to Common Shareholders $ 23,821 $ 23,927 $ 7,397 $ 8,075 Basic and Diluted Net Income (Loss) per Share Attributable to Common Shareholders $ 0.26 $ 0.25 $ 0.10 $ 0.09 Six Months Ended ( in thousands, except per share amounts 3/31/2019 3/31/2018 As Reported Pro-forma As Reported Pro-forma Rental Revenue $ 65,551 $ 66,297 $ 56,302 $ 66,739 Net Income (Loss) Attributable to Common Shareholders $ (8,543 ) $ (9,450 ) $ 20,710 $ 14,729 Basic and Diluted Net Income (Loss) per Share Attributable to Common Shareholders $ (0.09 ) $ (0.10 ) $ 0.27 $ 0.16 Tenant Concentration We have a concentration of FedEx Corporation (FDX) and FDX subsidiary-leased properties, consisting of 61 separate stand-alone leases covering 10.5 million square feet as of March 31, 2019 and 59 separate stand-alone leases covering 9.5 million square feet as of March 31, 2018. As of March 31, 2019, the 61 separate stand-alone leases that are leased to FDX and FDX subsidiaries are located in 25 different states and have a weighted average lease maturity of 9.1 years. The percentage of FDX and its subsidiaries leased square footage to the total of our rental space was 49% (5% to FDX and 44% to FDX subsidiaries) as of March 31, 2019 and 48% (8% to FDX and 40% to FDX subsidiaries) as of March 31, 2018. As of March 31, 2019, no other tenant accounted for 5% or more of our total rental space. Annualized Rental and Reimbursement Revenue from FDX and its subsidiaries is estimated to be approximately 60% (5% to FDX and 55% to FDX subsidiaries) of total Rental and Reimbursement Revenue for fiscal 2019, and was 60% (7% to FDX and 53% to FDX subsidiaries) of total Rental and Reimbursement Revenue for fiscal 2018. No other tenant accounted for 5% or more of our total Rental and Reimbursement Revenue for the six months ended March 31, 2019 and 2018. FDX is a publicly-owned company and financial information related to this entity is available at the SEC’s website, www.sec.gov www.standardandpoors.com www.moodys.com In addition to real estate property holdings, we held $177.4 million in marketable REIT securities at March 31, 2019, representing 8.5% of our undepreciated assets (which is our total assets excluding accumulated depreciation). These liquid real estate holdings are not included in calculating the tenant concentration ratios above and therefore further enhance our diversification. The securities portfolio provides us with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. |
Securities Available for Sale a
Securities Available for Sale at Fair Value | 6 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Securities Available for Sale at Fair Value | NOTE 4 – SECURITIES AVAILABLE FOR SALE AT FAIR VALUE Our Securities Available for Sale at Fair Value consists primarily of marketable common and preferred stock of other REITs with a fair value of $177.4 million as of March 31, 2019. We generally limit our investment in marketable securities to no more than approximately 10% of our undepreciated assets (which is our total assets excluding accumulated depreciation). Total assets excluding accumulated depreciation were $2.1 billion as of March 31, 2019. We held $177.4 million in marketable REIT securities as of March 31, 2019, representing 8.5% of our undepreciated assets. The REIT securities portfolio provides us with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. During the six months ended March 31, 2019, we did not sell or redeem any securities. In addition, we recognized dividend income on our investments in securities of $3.5 million and $7.9 million for the three and six months ended March 31, 2019. We also made purchases of $49.5 million in Securities Available for Sale at Fair Value during the six months ended March 31, 2019. Of this amount, we made total purchases of 34,000 common shares of UMH Properties, Inc. (UMH), a related REIT, for a total cost of $431,000, or an average cost of $12.68 per share, which were purchased through UMH’s Dividend Reinvestment and Stock Purchase Plan. We owned a total of 1.2 million UMH common shares as of March 31, 2019 at a total cost of $12.5 million and a fair value of $17.2 million representing 3.1% of the outstanding common shares of UMH. In addition, as of March 31, 2019, we own 100,000 shares of UMH’s 8.00% Series B Cumulative Redeemable Preferred Stock at a total cost of $2.5 million with a fair value of $2.6 million. The unrealized gain on our investment in UMH’s common and preferred stock as of March 31, 2019 was $4.8 million. As of March 31, 2019, we had total net unrealized holding losses on our securities portfolio of $51.8 million. As a result of the adoption of ASU 2016-01, $27.1 million of the net unrealized holding losses have been reflected as Unrealized Holding Gains (Losses) Arising During the Periods in the accompanying Consolidated Statements of Income (Loss) for the six months ended March 31, 2019 and the remaining $24.7 million of the net unrealized holding losses have been reflected as a reclass to beginning Undistributed Income (Loss). We consider many factors in determining whether a security is other than temporarily impaired, including the nature of the security and the cause, severity and duration of the impairment. We normally hold REIT securities long-term and have the ability and intent to hold these securities to recovery. We have determined that none of our security holdings are other than temporarily impaired and therefore all unrealized gains and losses from these securities have been recognized as Unrealized Holding Gains (Losses) Arising During the Periods in our Consolidated Statements of Income (Loss). If we were to determine any of our securities to be other than temporarily impaired, we would record an impairment charge in our Consolidated Statements of Income (Loss). |
Debt
Debt | 6 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 5 – DEBT For the three months ended March 31, 2019 and 2018, amortization of financing costs included in interest expense was $320,000 and $303,000, respectively. For the six months ended March 31, 2019 and 2018, amortization of financing costs included in interest expense was $637,000 and $596,000, respectively. As of March 31, 2019, we owned 113 properties, of which 62 carried Fixed Rate Mortgage Notes Payable with outstanding principal balances totaling $762.3 million. The following is a summary of our Fixed Rate Mortgage Notes Payable as of March 31, 2019 and September 30, 2018 (in thousands): 3/31/2019 9/30/2018 Amount Weighted Average Interest Rate (1) Amount Weighted Average Interest Rate (1) Fixed Rate Mortgage Notes Payable $ 762,340 4.07 % $ 719,768 4.07 % Debt Issuance Costs $ 11,786 $ 11,716 Accumulated Amortization of Debt Issuance Costs (3,569 ) (3,494 ) Unamortized Debt Issuance Costs $ 8,217 $ 8,222 Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs $ 754,123 $ 711,546 (1) Weighted average interest rate excludes amortization of debt issuance costs. As of March 31, 2019, interest payable on these mortgages were at fixed rates ranging from 3.45% to 7.60%, with a weighted average interest rate of 4.07%. This compares to a weighted average interest rate of 4.07% as of September 30, 2018 and 4.11% as of March 31, 2018. As of March 31, 2019, the weighted average loan maturity of the Fixed Rate Mortgage Notes Payable was 11.6 years. This compares to a weighted average loan maturity of the Fixed Rate Mortgage Notes Payable of 11.7 years as of September 30, 2018 and 11.5 years as of March 31, 2018. In connection with the two properties acquired during the six months ended March 31, 2019, which are located in Trenton, NJ and Savannah, GA (as described in Note 3), we obtained two 15 year fully-amortizing mortgage loans. The two mortgage loans originally totaled $72.5 million with a weighted average interest rate of 4.20%. During the six months ended March 31, 2019, we fully repaid a 6.0% mortgage loan for one of our properties located in Tampa, FL for $4.8 million. Subsequent to the quarter end, in April 2019, we fully repaid a 7.60% mortgage loan for our property located in Lebanon, TN for $7.1 million. As of March 31, 2019, Loans Payable represented the amount drawn down on our $200.0 million unsecured line of credit facility (the Facility) in the amount of $110.0 million and the amount drawn down on our margin loan of $19.8 million. The Facility matures in September 2020 with a one year extension at our option (subject to various conditions as specified in the loan agreement). During the six months ended March 31, 2019, we paid down our Facility by $50.0 million. Availability under the Facility is limited to 60% of the value of the borrowing base properties. The value of the borrowing base properties is determined by applying a capitalization rate to the NOI generated by our unencumbered properties. Effective, March 22, 2018, the capitalization rate applied to our NOI generated by our unencumbered properties was lowered from 7.0% to 6.5%, thus increasing the value of the borrowing base properties under the terms of the agreement. Borrowings under the Facility, will, at our election, either i) bear interest at LIBOR plus 140 basis points to 220 basis points, depending on our leverage ratio, or ii) bear interest at BMO’s prime lending rate plus 40 basis points to 120 basis points, depending on our leverage ratio. Our borrowings as of March 31, 2019, based on our leverage ratio, bear interest at LIBOR plus 170 basis points, which represented an interest rate of 4.20%. In addition, we have a $100.0 million accordion feature, bringing the total potential availability under the Facility (subject to various conditions as specified in the loan agreement) up to $300.0 million. We also invest in equity securities of other REITs which provides us with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. From time to time, we may purchase these securities on margin when the interest and dividend yields exceed the cost of funds. In general, we may borrow up to 50% of the value of the marketable securities, which was $177.4 million as of March 31, 2019. As of March 31, 2019, we had $19.8 million drawn against the margin at an interest rate of 3.0%. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Shareholders' Equity | NOTE 6 – SHAREHOLDERS’ EQUITY Our authorized stock as of March 31, 2019 consisted of 188.0 million shares of common stock, of which 93.9 million shares were issued and outstanding, 16.4 million 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 12.0 million shares were issued and outstanding, and 200.0 million authorized shares of Excess Stock, $0.01 par value per share, of which none were issued or outstanding. Common Stock In October 2018, we completed a public offering of 9.2 million shares of our Common Stock (including the underwriters’ option to purchase 1.2 million additional shares) at a price of $15.00 per share, before underwriting discounts. We received net proceeds from the offering, after deducting underwriting discounts and all other transaction costs, of $132.3 million. We raised $40.6 million (including dividend reinvestments of $8.5 million) from the issuance of 3.1 million shares of common stock under our DRIP during the six months ended March 31, 2019. During the six months ended March 31, 2019, we paid $31.4 million in total cash dividends, or $0.34 per share, to common shareholders, of which $8.5 million was reinvested in the DRIP, representing a 27% participation rate. On April 2, 2019, our Board of Directors declared a dividend of $0.17 per share to be paid June 17, 2019 to common shareholders of record as of the close of business on May 15, 2019. On January 16, 2019, our Board of Directors authorized a $40.0 million increase to our previously announced Common Stock Repurchase Program (the “Program”), bringing the total available under the Program to $50.0 million. The timing, manner, price and amount of any repurchase will be determined by us at our discretion and will be subject to economic and market conditions, stock price, applicable legal requirements and other factors. To date, we have not repurchased any common stock pursuant to the Program and we may elect not to repurchase any common stock in the future. The Program does not have a termination date and may be suspended or discontinued at our discretion without prior notice. 6.125% Series C Cumulative Redeemable Preferred Stock During the six months ended March 31, 2019, we paid $8.8 million in Preferred Dividends, or $0.765625 per share, on our outstanding 6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 par value per share, with a liquidation preference of $25.00 per share (6.125% Series C preferred stock) for the period September 1, 2018 through February 28, 2019. As of March 31, 2019, we have accrued Preferred Dividends of $1.5 million covering the period March 1, 2019 to March 31, 2019. Dividends on the 6.125% Series C Preferred Stock are cumulative and payable quarterly at an annual rate of $1.53125 per share. The 6.125% Series C Preferred Stock has no maturity date and will remain outstanding indefinitely unless redeemed or otherwise repurchased. Except in limited circumstances relating to our qualification as a REIT, or in connection with a change of control, the 6.125% Series C Preferred Stock is not redeemable prior to September 15, 2021. On and after September 15, 2021, at any time, and from time to time, the 6.125% Series C Preferred Stock will be redeemable in whole, or in part, at our option, at a cash redemption price of $25.00 per share, plus all accrued and unpaid dividends (whether or not declared) to, but not including, the date of redemption. On April 2, 2019, our Board of Directors declared a dividend of $0.3828125 per share to be paid June 17, 2019 to the 6.125% Series C Preferred shareholders of record as of the close of business on May 15, 2019. On June 29, 2017, we entered into a Preferred Stock At-The-Market Sales Agreement Program with B. Riley FBR, Inc., or B. Riley (formerly FBR Capital Markets & Co.), that provided for the offer and sale of shares of our 6.125% Series C Cumulative Redeemable Preferred Stock, having an aggregate sales price of up to $100.0 million. On August 2, 2018, we replaced this program with a new Preferred Stock At-The-Market Sales Agreement Program (Preferred Stock ATM Program) that provides for the offer and sale from time to time of $125.0 million of our 6.125% Series C preferred stock. Sales of shares of our 6.125% Series C preferred stock under the Preferred Stock ATM Program are in “at the market offerings” as defined in Rule 415 under the Securities Act, including, without limitation, sales made directly on or through the NYSE, or on any other existing trading market for the 6.125% Series C preferred stock or to or through a market maker or any other method permitted by law, including, without limitation, negotiated transactions and block trades. We began selling shares through these programs on July 3, 2017. Since inception through March 31, 2019, we sold 3.6 million shares under these programs at a weighted average price of $24.91 per share, and generated net proceeds, after offering expenses, of $87.1 million, of which 481,000 shares were sold during the six months ended March 31, 2019 at a weighted average price of $23.94 per share, and generated net proceeds, after offering expenses, of $11.3 million. As of March 31, 2019, there is $107.6 million remaining that may be sold under the Preferred Stock ATM Program. As of March 31, 2019, 12.0 million shares of the 6.125% Series C Preferred Stock were issued and outstanding. Subsequent to the March 31, 2019 quarter end, through April 25, 2019, we sold 247,000 shares under our Preferred Stock ATM Program at a weighted average price of $24.04 per share, and realized net proceeds, after offering expenses, of $5.8 million. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | NOTE 7 - FAIR VALUE MEASUREMENTS We measure certain financial assets and liabilities at fair value on a recurring basis, including Securities Available for Sale at Fair Value. Our financial assets consist mainly of marketable REIT securities. The fair value of these financial assets was determined using the following inputs at March 31, 2019 and September 30, 2018 (in thousands) : Fair Value Measurements at Reporting Date Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of March 31, 2019: Equity Securities – Preferred Stock $ 13,787 $ 13,787 $ -0- $ -0- Equity Securities – Common Stock 163,569 163,569 -0- -0- Mortgage Backed Securities 3 3 -0- -0- Total Securities Available for Sale at Fair Value $ 177,359 $ 177,359 $ -0- $ -0- As of September 30, 2018: Equity Securities – Preferred Stock $ 7,310 $ 7,310 $ -0- $ -0- Equity Securities – Common Stock 147,608 147,608 -0- -0- Mortgage Backed Securities 3 3 -0- -0- Total Securities Available for Sale at Fair Value $ 154,921 $ 154,921 $ -0- $ -0- In addition to our investments in Securities Available for Sale at Fair Value, we are required to disclose certain information about fair values of other financial instruments. Estimates of fair value are made at a specific point in time based upon, where available, relevant market prices and information about the financial instrument. Such estimates do not include any premium or discount that could result from offering for sale at one time our entire holdings of financial instruments. For a portion of our other financial instruments, no quoted market value exists. Therefore, estimates of fair value are necessarily based on a number of significant assumptions, many of which involve events outside the control of management. Such assumptions include assessments of current economic conditions, perceived risks associated with these financial instruments and their counterparties; future expected loss experience and other factors. Given the uncertainties surrounding these assumptions, the reported fair values represent estimates only, and therefore cannot be compared to the historical accounting model. The use of different assumptions or methodologies is likely to result in significantly different fair value estimates. The fair value of Cash and Cash Equivalents approximates their current carrying amounts since all such items are short term in nature. The fair value of variable rate Loans Payable approximates their current carrying amounts, since such amounts payable are at approximately a weighted-average current market rate of interest. The estimated fair value of Fixed Rate Mortgage Notes Payable is based on discounting the future cash flows at a yearend risk adjusted borrowing rate currently available to us for issuance of debt with similar terms and remaining maturities. These fair value measurements fall within level 2 of the fair value hierarchy. At March 31, 2019, the Fixed Rate Mortgage Notes Payable fair value (estimated based upon expected cash outflows discounted at current market rates) amounted to $753.7 million and the carrying value amounted to $762.3 million. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 6 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | NOTE 8 - SUPPLEMENTAL CASH FLOW INFORMATION Cash paid for interest during the six months ended March 31, 2019 and 2018 was $18.1 million and $15.1 million, respectively. During the six months ended March 31, 2019 and 2018, we had dividend reinvestments of $8.5 million and $6.0 million, respectively, which required no cash transfers. |
Contingencies and Commitments
Contingencies and Commitments | 6 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and Commitments | NOTE 9 – CONTINGENCIES AND COMMITMENTS From time to time, we may be subject to claims and litigation in the ordinary course of business. We do not believe that any such claim or litigation will have a material adverse effect on the Consolidated Balance Sheets or results of operations. We have entered into agreements to purchase five new build-to-suit, industrial buildings that are currently being developed in Indiana (2), North Carolina and Ohio (2), totaling 1.9 million square feet, with net-leased terms ranging from 10 to 15 years with a weighted average lease term of 13.7 years. The aggregate purchase price for these properties is $245.9 million. Two of these five properties, consisting of approximately 772,000 square feet, or 41%, are leased for 15 years to FedEx Ground Package System, Inc. and one of these five properties, consisting of 613,000 square feet, or 32% is leased for 15 years to Amazon.com Services, Inc. All five properties are leased to companies, or subsidiaries of companies, that are considered Investment Grade by S&P Global Ratings ( www.standardandpoors.com We obtained a commitment to enter into a 10.8 year, fully-amortizing second mortgage loan of $7.0 million at a fixed interest rate of 3.85% for our property located in Monroe (Cincinnati), OH. We recently completed a 155,000 square foot building expansion for this property for a total project cost of $8.6 million. The maturity of the second mortgage loan will coincide with the maturity of the property’s first fully-amortizing mortgage loan which is at a fixed interest rate of 3.77% and has a principal balance of $6.9 million as of the quarter end. The expansion resulted in a new 15 year lease which extended the prior lease expiration date from February 2030 to February 2034. The expansion also resulted in an increase in initial annual rent effective March 1, 2019 of $821,000 from $980,000, or $4.22 per square foot, to $1.8 million, or $4.65 per square foot. In addition, the annual rent will increase by 2% per annum, resulting in an average annualized rent of $2.1 million over the 15 years. We have entered into a new ten year lease for our future corporate office space located in Holmdel, NJ. The new lease is for 13,000 square feet and is expected to commence during our fourth quarter of fiscal 2019, at which time we expect to assign the existing lease pertaining to our current corporate office space located in Freehold, NJ to UMH. Initial gross annual rent for our new corporate office is approximately $410,000 or $31.00 per square foot. Our existing lease is for 5,700 square feet with annual gross rent averaging $137,000 or $24.17 per square foot over the remaining 2.5 year lease term. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 10 – SUBSEQUENT EVENTS Material subsequent events have been evaluated and are disclosed herein. On April 2, 2019, our Board of Directors declared a common dividend of $0.17 per share to be paid June 17, 2019 to common shareholders of record as of the close of business on May 15, 2019. On April 2, 2019, our Board of Directors declared a preferred dividend of $0.3828125 per share to be paid June 17, 2019 to the 6.125% Series C Preferred shareholders of record as of the close of business on May 15, 2019. Our 96,000 square foot facility located in Liberty (Kansas City), MO was leased to Holland 1916, Inc. through June 30, 2019. In conjunction with terminating our lease with Holland 1916, Inc. two months early, effective May 1, 2019 we entered into a seven year lease agreement with Dakota Bodies, LLC through April 30, 2026. Initial annual rent is $372,000, representing $3.85 per square foot, with 3.0% annual increases thereafter. This results in a straight-line annualized rent of $407,000, representing $4.21 per square foot over the life of the lease. This compares to the former U.S. GAAP straight-line rent of $3.46 per square foot and the former cash rent of $3.68 per square foot, resulting in an increase in the average lease rate of 21.7% on a U.S. GAAP straight-line basis and an increase of 4.6% on a cash basis. In April 2019, we fully repaid a 7.60% mortgage loan for our property located in Lebanon, TN for $7.1 million. Subsequent to the March 31, 2019 quarter end, through April 25, 2019, we sold 247,000 shares under our Preferred Stock ATM Program at a weighted average price of $24.04 per share, and realized net proceeds, after offering expenses, of $5.8 million. |
Organization and Accounting P_2
Organization and Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of Estimates | Use of Estimates In preparing the financial statements in accordance with U.S. GAAP, we are required to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods and related disclosure of contingent assets and liabilities. Actual results could differ from these estimates and assumptions. |
Reclassification | Reclassification Certain prior period amounts in the accompanying Consolidated Financial Statements have been reclassified to conform to the current period’s presentation. |
Stock Compensation Plan | Stock Compensation Plan We account for awards of stock, 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 stock awards and restricted stock awards is equal to the fair value of our stock on the grant date. The amortization of compensation costs for the awards of stock, stock option grants and restricted stock are included in General and Administrative Expenses in the accompanying Consolidated Statements of Income (Loss) and amounted to $215,000 and $111,000 for the three months ended March 31, 2019 and 2018, respectively and amounted to $344,000 and $242,000 for the six months ended March 31, 2019 and 2018, respectively. During the six months ended March 31, 2019 and 2018, the following stock options, which vest one year after grant date, were granted under our Stock Option Plan: Date of Grant Number of Employees Number of Shares (in thousands) Option Price Expiration Date 1/10/19 1 65 $ 12.86 1/10/27 12/10/18 12 385 $ 13.64 12/10/26 1/3/18 1 65 $ 17.80 1/3/26 The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated: Fiscal 2019 Fiscal 2018 Dividend yield 5.03 % 3.82 % Expected volatility 17.17 % 16.45 % Risk-free interest rate 2.88 % 2.37 % Expected lives (years) 8 8 Estimated forfeitures -0- -0- The weighted-average fair value of options granted during the six months ended March 31, 2019 and 2018 was $1.17 and $1.84 per share subject to the option. During the six months ended March 31, 2019 and 2018, 25,000 and 12,500 shares of restricted stock were granted, respectively. During the six months ended March 31, 2019, one participant exercised options to purchase 65,000 shares of common stock at a price of $8.72 per share for total proceeds of $567,000. During the six months ended March 31, 2018, three participants exercised options awarded under the Plan to purchase an aggregate of 40,000 shares of common stock at a weighted average exercise price of $14.24 per share for total proceeds of $570,000. As of March 31, 2019, a total of 1.2 million shares were available for grant as stock options, as restricted stock, or other equity based awards, plus any shares subject to outstanding options that expire or are forfeited without being exercised. As of March 31, 2019, there were outstanding options to purchase 1.1 million shares with an aggregate intrinsic value of $1.0 million. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (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 became effective for our fiscal year beginning October 1, 2018. The most significant change for us, once ASU 2016-01 was adopted, was the accounting treatment for our investments in marketable securities that are classified as available for sale. The accounting treatment used for our Consolidated Financial Statements through Fiscal 2018 was that our investments in marketable securities, classified as available for sale, were carried at fair value, with net unrealized holding gains and losses being excluded from earnings and reported as a separate component of Shareholders’ Equity until realized and the change in net unrealized holding gains and losses being reflected as comprehensive income (loss). Under ASU 2016-01, effective October 1, 2018, these marketable securities continue to be measured at fair value, however, the changes in net unrealized holding gains and losses are now recognized through net income on our Consolidated Statements of Income (Loss). On October 1, 2018, unrealized net holding losses of $24.7 million were reclassed to beginning Undistributed Income (Loss) to recognize the unrealized losses previously recorded in “accumulated other comprehensive income” on our consolidated balance sheets. 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 lessee and 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. The most significant changes related to lessor accounting under ASU 2016-02 include bifurcating revenue into lease and non-lease components and the new standard’s narrow definition of initial direct costs for leases. Since our revenue is primarily derived from leasing activities from long-term net-leases and since we currently do not capitalize indirect costs for leases, we believe that we will continue to account for our leases and related leasing costs in substantially the same manner as we currently do once the adoption of the ASU 2016-02 becomes effective. In addition, the guidance requires lessees to recognize assets and liabilities for operating leases with lease terms greater than twelve months on the balance sheet. Therefore, the most significant impact for us may be the recognition of our corporate office lease, while accounting where we are the lessor will remain substantially the same. Upon adoption, we may recognize an asset and lease liability equal to the present value of the minimum lease payments due under our corporate office lease. In July 2018, the FASB issued ASU 2018-10, “Codification Improvements to Topic 842, Leases”. The amendment in ASU 2018-10 affects narrow aspects of the guidance issued earlier in ASU 2016-02 by removing certain inconsistencies and providing additional clarification related to the guidance issued earlier. We are currently evaluating the potential impact this standard may have on our consolidated financial statements and expect that the adoption of this standard will not have a significant impact on our consolidated financial statements and related disclosures. In December 2018, the FASB issued ASU 2018-20 “Narrow-Scope Improvements for Lessors”. Similar to ASU 2018-10, 2018-20 affects narrow aspects of the guidance issued earlier in ASU 2016-02 as well by providing additional clarification related to the guidance issued earlier. The most significant changes related to lessor accounting under ASU 2018-20 is the clarification of how to treat payments made by a lessee directly to a third party, such as real estate taxes paid by the lessee directly to the taxing authority, whereby items paid directly by the lessee to a third party should not be reflected in the lessors income statement and, thus, should not be bifurcated and included in revenue and operating expenses. A majority of our reimbursable expenses are paid by us and are billed back to our lessees. Therefore, these reimbursable expenses will continue to be presented separately by bifurcating these revenue and expense items in our Consolidated Statements of Income. We are currently evaluating the potential impact this standard may have on our consolidated financial statements and expect that the adoption of this standard will not have a significant impact on our consolidated financial statements and related disclosures, other than any of these types of payments made by a lessee directly to a third party will no longer be presented on a gross basis in our Consolidated Statements of Income, which will have a net zero effect on our Net Income Attributable to Common Shareholders. ASU 2016-02, 2018-10 and 2018-20 are effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2018. Therefore, we expect to adopt these standards effective October 1, 2019. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers”. The FASB issued further guidance in ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, that provides clarifying guidance in certain narrow areas and adds some practical expedients. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The effective date of ASU 2014-09 was extended by one year by ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”. The new standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017. Therefore, we adopted the standard effective October 1, 2018. Our revenue is primarily derived from leasing activities and historically our property dispositions have been cash sales with no contingencies and no future involvement in the property. Since this standard applies to all contracts with customers except those that are within the scope of other guidance, such as leases, the adoption of this standard did not have a significant impact on our consolidated financial statements and related disclosures. We do not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying Consolidated Financial Statements. |
Segment Reporting & Financial Information | Segment Reporting & Financial Information Our primary business is the ownership and management of real estate properties. We invest in well-located, modern, single-tenant, industrial buildings leased primarily to investment-grade tenants or their subsidiaries on long-term net-leases. We review operating and financial information for each property on an individual basis and, therefore, each property represents an individual operating segment. We evaluate financial performance using Net Operating Income (NOI) from property operations. NOI is a non-GAAP financial measure, which we define as recurring Rental and Reimbursement Revenue, less Real Estate Taxes and Operating Expenses, such as insurance, utilities and repairs and maintenance. We have aggregated the properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities, including the fact that they are operated as industrial properties subject to long-term net-leases primarily to investment-grade tenants or their subsidiaries. |
Organization and Accounting P_3
Organization and Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Stock Options Outstanding | During the six months ended March 31, 2019 and 2018, the following stock options, which vest one year after grant date, were granted under our Stock Option Plan: Date of Grant Number of Employees Number of Shares (in thousands) Option Price Expiration Date 1/10/19 1 65 $ 12.86 1/10/27 12/10/18 12 385 $ 13.64 12/10/26 1/3/18 1 65 $ 17.80 1/3/26 |
Schedule of Stock Options, Valuation Assumptions | The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated: Fiscal 2019 Fiscal 2018 Dividend yield 5.03 % 3.82 % Expected volatility 17.17 % 16.45 % Risk-free interest rate 2.88 % 2.37 % Expected lives (years) 8 8 Estimated forfeitures -0- -0- |
Real Estate Investments (Tables
Real Estate Investments (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Real Estate [Abstract] | |
Schedule of Properties Acquired During Period Accounted for Asset Acquisitions | The financial information set forth below summarizes our purchase price allocation for these two properties acquired during the six months ended March 31, 2019 that are accounted for as asset acquisitions (in thousands): Land $ 11,778 Building 99,741 In-Place Leases 1,886 |
Summary of Consolidated Statements of Income for Properties Acquired | The following table summarizes the operating results included in our consolidated statements of income for the three and six months ended March 31, 2019 for the two properties acquired during the six months ended March 31, 2019 (in thousands): Three Months Ended 3/31/2019 Six Months Ended 3/31/2019 Rental Revenues $ 1,775 $ 3,096 Net Income Attributable to Common Shareholders 326 800 |
Summary of Income from Properties Sold During the Prior Year | The following table summarizes the operations of the two properties that were sold during the prior year, prior to their sales, and the two properties that were classified as Real Estate Held for Sale that are included in the accompanying Consolidated Statements of Income for the three and six months ended March 31, 2018 (in thousands). Three Months Ended Six Months Ended 3/31/2019 3/31/2018 3/31/2019 3/31/2018 Rental and Reimbursement Revenue $ -0- $ 278 $ -0- $ 857 Lease Termination Income -0- -0- -0- 210 Real Estate Taxes -0- (17 ) -0- (228 ) Operating Expenses -0- (36 ) -0- (85 ) Depreciation & Amortization -0- (5 ) -0- (63 ) Interest Expense, including Amortization of Financing Costs -0- (12 ) -0- (26 ) Income from Operations -0- 208 -0- 665 Gain on Sale of Real Estate Investments -0- -0- -0- 5,388 Net Income $ -0- $ 208 $ -0- $ 6,053 |
Schedule of Pro Forma Information | The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisitions and expansions reflected herein been consummated on the dates indicated or that will be achieved in the future. Three Months Ended ( in thousands, except per share amounts 3/31/2019 3/31/2018 As Reported Pro-forma As Reported Pro-forma Rental Revenue $ 32,934 $ 33,074 $ 28,610 $ 33,347 Net Income (Loss) Attributable to Common Shareholders $ 23,821 $ 23,927 $ 7,397 $ 8,075 Basic and Diluted Net Income (Loss) per Share Attributable to Common Shareholders $ 0.26 $ 0.25 $ 0.10 $ 0.09 Six Months Ended ( in thousands, except per share amounts 3/31/2019 3/31/2018 As Reported Pro-forma As Reported Pro-forma Rental Revenue $ 65,551 $ 66,297 $ 56,302 $ 66,739 Net Income (Loss) Attributable to Common Shareholders $ (8,543 ) $ (9,450 ) $ 20,710 $ 14,729 Basic and Diluted Net Income (Loss) per Share Attributable to Common Shareholders $ (0.09 ) $ (0.10 ) $ 0.27 $ 0.16 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Summary of Fixed Rate Mortgage Notes Payable | The following is a summary of our Fixed Rate Mortgage Notes Payable as of March 31, 2019 and September 30, 2018 (in thousands): 3/31/2019 9/30/2018 Amount Weighted Average Interest Rate (1) Amount Weighted Average Interest Rate (1) Fixed Rate Mortgage Notes Payable $ 762,340 4.07 % $ 719,768 4.07 % Debt Issuance Costs $ 11,786 $ 11,716 Accumulated Amortization of Debt Issuance Costs (3,569 ) (3,494 ) Unamortized Debt Issuance Costs $ 8,217 $ 8,222 Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs $ 754,123 $ 711,546 (1) Weighted average interest rate excludes amortization of debt issuance costs. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value of Financial Assets | The fair value of these financial assets was determined using the following inputs at March 31, 2019 and September 30, 2018 (in thousands) : Fair Value Measurements at Reporting Date Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of March 31, 2019: Equity Securities – Preferred Stock $ 13,787 $ 13,787 $ -0- $ -0- Equity Securities – Common Stock 163,569 163,569 -0- -0- Mortgage Backed Securities 3 3 -0- -0- Total Securities Available for Sale at Fair Value $ 177,359 $ 177,359 $ -0- $ -0- As of September 30, 2018: Equity Securities – Preferred Stock $ 7,310 $ 7,310 $ -0- $ -0- Equity Securities – Common Stock 147,608 147,608 -0- -0- Mortgage Backed Securities 3 3 -0- -0- Total Securities Available for Sale at Fair Value $ 154,921 $ 154,921 $ -0- $ -0- |
Organization and Accounting P_4
Organization and Accounting Policies (Details Narrative) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Mar. 31, 2019USD ($)ft²Propertiesshares | Mar. 31, 2018USD ($) | Mar. 31, 2019USD ($)ft²Properties$ / sharesshares | Mar. 31, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)ft²Properties | Oct. 02, 2018USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Number of real estate properties owned | Properties | 113 | 113 | 111 | |||
Total square foot of property | ft² | 21,800,000 | 21,800,000 | 21,200,000 | |||
Percentage of properties occupied | 98.90% | 99.60% | ||||
Weighted average lease maturity | 8 years | 8 years | ||||
Average base rent per square foot | 6.23 | |||||
Weighted average building age, term | 8 years 9 months 18 days | |||||
REIT investment securities, description | We also own a portfolio of REIT investment securities, which we generally limit to no more than approximately 10% of our undepreciated assets (which is our total assets, excluding accumulated depreciation). | |||||
Total assets excluding accumulated depreciation | $ 2,100,000 | $ 2,100,000 | ||||
Securities available for sale at fair value | 177,359 | $ 177,359 | $ 154,921 | |||
Percentage of marketable securities to undepreciated assets | 8.50% | |||||
Percentage that may be deducted from qualified REIT dividends for tax purposes | 20.00% | |||||
Amortization of compensation costs included in general and administrative expenses | $ 215 | $ 111 | $ 344 | $ 242 | ||
Weighted average fair value of stock option | $ / shares | $ 1.17 | $ 1.84 | ||||
Number restricted stock shares granted | shares | 25,000 | 12,500 | ||||
Number of stock option exercised | shares | 65,000 | 40,000 | ||||
Weighted average exercise price per share | $ / shares | $ 8.72 | $ 14.24 | ||||
Total proceeds | $ 567 | $ 570 | ||||
Stock option shares available for grant | shares | 1,200 | 1,200 | ||||
Option to purchase shares outstanding | shares | 1,100 | |||||
Aggregate intrinsic value of options | $ 1,000 | $ 1,000 | ||||
Unrealized net holding losses reclassed | $ 0 | $ 0 | $ 24,744 | $ 24,744 |
Organization and Accounting P_5
Organization and Accounting Policies - Summary of Stock Options Outstanding (Details) shares in Thousands | 6 Months Ended | |
Mar. 31, 2019Employee$ / sharesshares | Mar. 31, 2018Employee$ / sharesshares | |
Stock Option One [Member] | ||
Date of Grant | Jan. 10, 2019 | |
Number of Employees | Employee | 1 | |
Number of Shares | shares | 65 | |
Option Price | $ / shares | $ 12.86 | |
Expiration Date | Jan. 10, 2027 | |
Stock Option Two [Member] | ||
Date of Grant | Dec. 10, 2018 | |
Number of Employees | Employee | 12 | |
Number of Shares | shares | 385 | |
Option Price | $ / shares | $ 13.64 | |
Expiration Date | Dec. 10, 2026 | |
Stock Option Three [Member] | ||
Date of Grant | Jan. 3, 2018 | |
Number of Employees | Employee | 1 | |
Number of Shares | shares | 65 | |
Option Price | $ / shares | $ 17.80 | |
Expiration Date | Jan. 3, 2026 |
Organization and Accounting P_6
Organization and Accounting Policies - Schedule of Stock Options, Valuation Assumptions (Details) - shares shares in Thousands | 6 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Dividend yield | 5.03% | 3.82% |
Expected volatility | 17.17% | 16.45% |
Risk-free interest rate | 2.88% | 2.37% |
Expected lives (years) | 8 years | 8 years |
Estimated forfeitures | 0 | 0 |
Net Income Per Share (Details N
Net Income Per Share (Details Narrative) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Earnings Per Share [Abstract] | ||||
Common stock equivalents included in the diluted weighted average shares outstanding | 81 | 164 | 103 | 187 |
Antidilutive options to purchase common stock shares | 690 | 65 | 305 | 65 |
Real Estate Investments (Detail
Real Estate Investments (Details Narrative) shares in Thousands, $ in Thousands | Nov. 30, 2018USD ($)ft²a | Oct. 19, 2018USD ($)ft²a | Dec. 22, 2017USD ($)ft² | Dec. 18, 2017USD ($)ft² | Oct. 31, 2018shares | Mar. 31, 2019USD ($)ft² | Mar. 31, 2018USD ($)ft² | Mar. 31, 2019USD ($)ft²$ / ft² | Mar. 31, 2018USD ($)ft² | Sep. 30, 2018ft² |
Transaction costs | $ 324 | |||||||||
Total square foot of portfolio | ft² | 21,800,000 | 21,800,000 | 21,200,000 | |||||||
Lease termination income | $ 0 | $ 0 | $ 0 | $ 210 | ||||||
Common stock issued during period, shares | shares | 9,200 | |||||||||
Weighted average lease maturity | 8 years | 8 years | ||||||||
Held marketable securities | $ 177,400 | $ 177,400 | ||||||||
Marketable securities as a percentage of undepreciated assets | 8.50% | |||||||||
Series C Cumulative Redeemable Preferred Stock [Member] | ||||||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | 6.125% | ||||||||
Monroe, OH [Member] | ||||||||||
Lease term | 15 years | |||||||||
Face amount of original mortgage | $ 6,900 | |||||||||
Mortgage loan on real estate, interest rate | 3.77% | |||||||||
Square feet of expansion to industrial building | ft² | 155,000 | 155,000 | ||||||||
Cost of building expansion | $ 8,600 | $ 8,600 | ||||||||
Extended prior lease expiration date | February 2030 to February 2034 | |||||||||
Increase in rent | $ 821 | |||||||||
Rent prior to expansion | $ 980 | |||||||||
Rent prior to expansion, per square foot | $ / ft² | 4.22 | |||||||||
Rent increase to after expansion | $ 1,800 | |||||||||
Rent increase to after expansion, per square foot | $ / ft² | 4.65 | |||||||||
Increase in annual rent per year | 2.00% | |||||||||
Average annualized rent over the term of lease | $ 2,100 | |||||||||
Mortgage loan maturity description | The maturity of the second mortgage loan will coincide with the maturity of the property’s first fully-amortizing mortgage loan | |||||||||
Monroe, OH [Member] | Second Mortgage Loan [Member] | ||||||||||
Mortgage loan amortization period | 10 years 9 months 18 days | |||||||||
Face amount of new mortgage | $ 7,000 | |||||||||
Mortgage loan on real estate, interest rate | 3.85% | |||||||||
Kansas City, MO [Member] | ||||||||||
Square feet of industrial buildings | ft² | 65,000 | |||||||||
Gross proceeds from sale of property | $ 4,900 | |||||||||
Proceeds from sale of property | $ 4,600 | |||||||||
Orangeburg NY [Member] | ||||||||||
Square feet of industrial buildings | ft² | 50,000 | |||||||||
Gross proceeds from sale of property | $ 6,200 | |||||||||
Proceeds from sale of property | $ 5,900 | |||||||||
Kansas City, MO and Orangeburg [Member] | ||||||||||
Lease termination income | $ 210 | |||||||||
Weighted average of remaining rent due under each lease | 80.00% | |||||||||
Ft. Myers, FL [Member] | ||||||||||
Square feet of industrial buildings | ft² | 88,000 | 88,000 | ||||||||
Colorado Springs, CO [Member] | ||||||||||
Square feet of industrial buildings | ft² | 68,000 | 68,000 | ||||||||
Fedex And Fedex Subsidiaries [Member] | ||||||||||
Square feet of real estate property leased | ft² | 10,500,000 | 9,500,000 | ||||||||
Weighted average lease maturity | 9 years 1 month 6 days | 9 years 1 month 6 days | ||||||||
Percentage of real estate property leased | 49.00% | 48.00% | ||||||||
Percentage of rental space and tenant account, description | no other tenant accounted for 5% or more of our total rental space | |||||||||
Fedex And Fedex Subsidiaries [Member] | Rental And Reimbursement Revenue [Member] | ||||||||||
Percentage of rental space and tenant account, description | no other tenant accounted for 5% or more of our total rental | no other tenant accounted for 5% or more of our total rental | ||||||||
Percentage of aggregate rental and reimbursement revenue | 60.00% | 60.00% | ||||||||
FedEx Corporation [Member] | ||||||||||
Percentage of real estate property leased | 5.00% | 8.00% | ||||||||
FedEx Corporation [Member] | Rental And Reimbursement Revenue [Member] | ||||||||||
Percentage of aggregate rental and reimbursement revenue | 5.00% | 7.00% | ||||||||
FedEx Corporation Subsidiaries Member [Member] | ||||||||||
Percentage of real estate property leased | 44.00% | 40.00% | ||||||||
FedEx Corporation Subsidiaries Member [Member] | Rental And Reimbursement Revenue [Member] | ||||||||||
Percentage of aggregate rental and reimbursement revenue | 55.00% | 53.00% | ||||||||
Industrial Buildings [Member] | FedEx Ground Package System, Inc [Member] | ||||||||||
Purchase of industrial building | ft² | 127,000 | 347,000 | ||||||||
Area of property | a | 29.4 | 62 | ||||||||
Percentage of building area leased | 100.00% | 100.00% | ||||||||
Lease term | 10 years | 15 years | ||||||||
Lease term expiration period | Oct. 31, 2028 | Jun. 30, 2032 | ||||||||
Purchase price of industrial building | $ 27,800 | $ 85,200 | ||||||||
Mortgage loan amortization period | 15 years | 15 years | ||||||||
Face amount of mortgages | $ 17,500 | $ 55,000 | ||||||||
Mortgage loan on real estate, interest rate | 4.40% | 4.13% | ||||||||
Annual rental income over the remaining term of lease | $ 1,800 | $ 5,300 |
Real Estate Investments - Sched
Real Estate Investments - Schedule of Properties Acquired During Period Accounted for Asset Acquisitions (Details) $ in Thousands | 6 Months Ended |
Mar. 31, 2019USD ($) | |
Land [Member] | |
Purchase price allocation of properties acquired | $ 11,778 |
Buildings [Member] | |
Purchase price allocation of properties acquired | 99,741 |
In-Place Leases [Member] | |
Purchase price allocation of properties acquired | $ 1,886 |
Real Estate Investments - Summa
Real Estate Investments - Summary of Consolidated Statements of Income for Properties Acquired (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Mar. 31, 2019 | Mar. 31, 2019 | |
Real Estate [Abstract] | ||
Rental Revenues | $ 1,775 | $ 3,096 |
Net Income Attributable to Common Shareholders | $ 326 | $ 800 |
Real Estate Investments - Sum_2
Real Estate Investments - Summary of Income from Properties Sold During the Prior Year (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Lease Termination Income | $ 0 | $ 0 | $ 0 | $ 210 |
Real Estate Held for Sale [Member] | ||||
Rental and Reimbursement Revenue | 0 | 278 | 0 | 857 |
Lease Termination Income | 0 | 0 | 0 | 210 |
Real Estate Taxes | 0 | (17) | 0 | (228) |
Operating Expenses | 0 | (36) | 0 | (85) |
Depreciation & Amortization | 0 | (5) | 0 | (63) |
Interest Expense, including Amortization of Financing Costs | 0 | (12) | 0 | (26) |
Income from Operations | 0 | 208 | 0 | 665 |
Gain on Sale of Real Estate Investments | 0 | 0 | 0 | 5,388 |
Net Income | $ 0 | $ 208 | $ 0 | $ 6,053 |
Real Estate Investments - Sch_2
Real Estate Investments - Schedule of Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Rental Revenue | $ 32,934 | $ 28,610 | $ 65,551 | $ 56,302 |
Net Income (Loss) Attributable to Common Shareholders | $ 23,821 | $ 7,397 | $ (8,543) | $ 20,710 |
Basic and Diluted Net Income (Loss) per Share Attributable to Common Shareholders | $ 0.26 | $ 0.1 | $ (0.09) | $ 0.27 |
Pro Forma [Member] | ||||
Rental Revenue | $ 33,074 | $ 33,347 | $ 66,297 | $ 66,739 |
Net Income (Loss) Attributable to Common Shareholders | $ 23,927 | $ 8,075 | $ (9,450) | $ 14,729 |
Basic and Diluted Net Income (Loss) per Share Attributable to Common Shareholders | $ 0.25 | $ 0.09 | $ (0.10) | $ 0.16 |
Securities Available for Sale_2
Securities Available for Sale at Fair Value (Details Narrative) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Oct. 02, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | |||||
Marketable REIT securities fair value | $ 177,400 | ||||
Security available for sale, maximum percentage of investment on undepreciated assets | 10.00% | ||||
Total assets excluding accumulated depreciation | $ 2,100,000 | $ 2,100,000 | |||
Marketable securities as a percentage of undepreciated assets | 8.50% | ||||
Dividend income on investment in securities | 3,515 | $ 2,888 | $ 7,882 | $ 5,752 | |
Purchase of securities available for sale | 49,497 | 61,069 | |||
Net unrealized gain on securities portfolio | $ 24,700 | 51,800 | |||
Unrealized holding gains (losses) arising during the period | $ 15,568 | $ 0 | $ (27,059) | $ 0 | |
UMH Properties, Inc [Member] | Series B Cumulative Redeemable Preferred Stock [Member] | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Available for sale securities, shares | 100 | 100 | |||
Marketable REIT securities fair value | $ 2,600 | ||||
Shares owned, cost | $ 2,500 | $ 2,500 | |||
Dividend rate of preferred stock | 8.00% | ||||
UMH Properties, Inc [Member] | Common and Preferred Stock [Member] | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Net unrealized gain on securities portfolio | $ 4,800 | ||||
UMH Properties, Inc [Member] | Common Stock [Member] | |||||
Debt Securities, Available-for-sale [Line Items] | |||||
Marketable REIT securities fair value | $ 17,200 | ||||
UMH common shares purchased during the quarter | 34 | 34 | |||
Cost of securities purchased | $ 431 | $ 431 | |||
Dividend reinvestment and stock purchase plan cost, per share | $ 12.68 | $ 12.68 | |||
Shares owned by company | 1,200 | 1,200 | |||
Shares owned, cost | $ 12,500 | $ 12,500 | |||
Outstanding common shares, percentage | 3.10% | 3.10% |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2018 | |
Interest expense amortization of financing costs | $ 320 | $ 303 | $ 637 | $ 596 | |
Fixed rate mortgage notes payable, description | We owned 113 properties, of which 62 carried Fixed Rate Mortgage Notes Payable with outstanding principal balances totaling $762.3 million. | ||||
Fixed rate mortgage notes payable | 762,300 | $ 762,300 | |||
Weighted average interest rate percentage | 4.07% | 4.11% | 4.07% | ||
Notes payable maturity period | 11 years 7 months 6 days | 11 years 6 months | 11 years 8 months 12 days | ||
Proceeds from fixed rate mortgage notes payable | $ 72,500 | $ 67,100 | |||
Drawn down margin loan | $ 19,800 | $ 19,800 | |||
Maximum borrowing percentage of marketable securities | 50.00% | 50.00% | |||
Securities available for sale at fair value | $ 177,359 | $ 177,359 | $ 154,921 | ||
Margin loan bearing interest rate | 3.00% | 3.00% | |||
Line of Credit [Member] | |||||
Total availability of unsecured credit facility | $ 200,000 | $ 200,000 | |||
Line of credit amount | 110,000 | 110,000 | |||
Repayment of line of credit facility | $ 50,000 | ||||
Debt maturity date | Sep. 30, 2020 | ||||
Line of credit facility interest rate terms | Availability under the Facility is limited to 60% of the value of the borrowing base properties. The value of the borrowing base properties is determined by applying a capitalization rate to the NOI generated by our unencumbered properties. Effective, March 22, 2018, the capitalization rate applied to our NOI generated by our unencumbered properties was lowered from 7.0% to 6.5%, thus increasing the value of the borrowing base properties under the terms of the agreement. Borrowings under the Facility, will, at our election, either i) bear interest at LIBOR plus 140 basis points to 220 basis points, depending on our leverage ratio, or ii) bear interest at BMO’s prime lending rate plus 40 basis points to 120 basis points, depending on our leverage ratio. Our borrowings as of March 31, 2019, based on our leverage ratio, bear interest at LIBOR plus 170 basis points, which represented an interest rate of 4.20%. | ||||
Line of credit facility related to accordion feature | $ 100,000 | $ 100,000 | |||
Total potential available under unsecured line of credit | $ 300,000 | ||||
Tampa, FL [Member] | |||||
Annual interest rate | 6.00% | ||||
Mortgages paid off | $ 4,800 | ||||
Lebanon, TN [Member] | Subsequent to the Quarter End [Member] | |||||
Annual interest rate | 7.60% | ||||
Mortgages paid off | $ 7,100 | ||||
Two Mortgages Loans [Member] | |||||
Weighted average interest rate percentage | 4.20% | ||||
Mortgage loan amortization period | 15 years | ||||
Proceeds from fixed rate mortgage notes payable | $ 72,500 | ||||
Minimum [Member] | |||||
Annual interest rate | 3.45% | ||||
Maximum [Member] | |||||
Annual interest rate | 7.60% |
Debt - Summary of Fixed Rate Mo
Debt - Summary of Fixed Rate Mortgage Notes Payable (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Sep. 30, 2018 | ||
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs | $ 754,123 | $ 711,546 | |
Mortgage Notes Payable [Member] | |||
Fixed Rate Mortgage Notes Payable, Amount | $ 762,340 | $ 719,768 | |
Weighted Average Interest Rate | [1] | 4.07% | 4.07% |
Debt Issuance Costs | $ 11,786 | $ 11,716 | |
Accumulated Amortization of Debt Issuance Costs | (3,569) | (3,494) | |
Unamortized Debt Issuance Costs | 8,217 | 8,222 | |
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs | $ 754,123 | $ 711,546 | |
[1] | Weighted average interest rate excludes amortization of debt issuance costs. |
Shareholders' Equity (Details N
Shareholders' Equity (Details Narrative) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Jan. 16, 2019 | Aug. 02, 2018 | Jun. 29, 2017 | Apr. 25, 2019 | Oct. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Sep. 30, 2018 |
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Number of common shares sold | 9,200 | ||||||||||
Sale of stock price per share | $ 15 | ||||||||||
Net proceeds from issuance common stock offering | $ 132,338 | $ 132,338 | |||||||||
Amount of dividend reinvested | 8,500 | $ 6,000 | |||||||||
Cash dividends paid | 31,395 | ||||||||||
Accrued preferred dividends | $ 8,901 | ||||||||||
Annual rate of preferred dividends cumulative and payable | $ 0.3828125 | $ 0.3828125 | $ 0.765625 | $ 0.765625 | |||||||
Dividend Reinvestment and Stock Purchase Plan [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Amount of dividend reinvested | $ 8,500 | ||||||||||
Common stock issued under plan | 3,100 | ||||||||||
Dividends participation rate | 27.00% | ||||||||||
Preferred Stock ATM Program [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Number of preferred shares sold | 481 | 3,600 | |||||||||
Proceeds from the issuance of preferred stock from the ATM Program | $ 11,300 | $ 87,100 | |||||||||
Weighted average price per share of shares sold under the ATM | $ 24.91 | $ 24.91 | $ 24.91 | ||||||||
Remaining amount to be sold under the ATM Program | $ 107,600 | $ 107,600 | $ 107,600 | ||||||||
Preferred Stock ATM Program [Member] | Subsequent Event [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Sale of stock price per share | $ 24.04 | ||||||||||
Net proceeds from issuance of preferred stock from ATM Program | $ 5,800 | ||||||||||
Number of preferred shares sold | 247 | ||||||||||
Preferred Stock ATM Program [Member] | Second Quarter Member [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Weighted average price per share of shares sold under the ATM | $ 23.94 | $ 23.94 | $ 23.94 | ||||||||
Underwriters [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Underwriters option to purchase additional shares | 1,200 | ||||||||||
Board of Directors [Member] | Common Shareholders [Member ] | April 2, 2019 [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Dividend declared per share | 0.17 | $ 0.17 | 0.17 | ||||||||
Dividend declaration date | Apr. 2, 2019 | ||||||||||
Dividends payable, date to be paid | Jun. 17, 2019 | ||||||||||
Dividend payable date of record | May 15, 2019 | ||||||||||
Board of Directors [Member] | Series C Preferred Shareholders [Member] | April 2, 2019 [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Dividend declared per share | $ 0.3828125 | $ 0.3828125 | $ 0.3828125 | ||||||||
Dividend declaration date | Apr. 2, 2019 | ||||||||||
Dividends payable, date to be paid | Jun. 17, 2019 | ||||||||||
Dividend payable date of record | May 15, 2019 | ||||||||||
Board of Directors [Member] | Common Stock Repurchase Program [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Increase in the value of common stock available under program | $ 40,000 | ||||||||||
Share Repurchase Program authorizes amount | $ 50,000 | ||||||||||
Series C Preferred Stock [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Preferred stock, shares authorized | 16,400 | 16,400 | 16,400 | 16,400 | |||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | 6.125% | 6.125% | 6.125% | 6.125% | ||||||
Preferred stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||
Preferred stock, shares issued | 11,969 | 11,969 | 11,969 | 11,488 | |||||||
Preferred stock, shares outstanding | 11,969 | 11,969 | 11,969 | 11,488 | |||||||
Maximum amount of proceeds allowed from the issuance of preferred stock from the ATM program | $ 125,000 | ||||||||||
Series C Cumulative Redeemable Preferred Stock [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | 6.125% | 6.125% | ||||||||
Preferred stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||
Cash dividends paid | $ 8,800 | ||||||||||
Dividend declared per share | 0.765625 | $ 0.765625 | 0.765625 | ||||||||
Liquidation price per share | 25 | $ 25 | 25 | ||||||||
Accrued preferred dividends | $ 1,500 | ||||||||||
Annual rate of preferred dividends cumulative and payable | $ 1.53125 | ||||||||||
Preferred stock redemption price | $ 25 | $ 25 | $ 25 | ||||||||
Series C Cumulative Redeemable Preferred Stock [Member] | On and After September 15, 2021 [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | 6.125% | 6.125% | ||||||||
Series C Cumulative Redeemable Preferred Stock [Member] | Preferred Stock ATM Program [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Cumulative redeemable preferred, stock dividend rate | 6.125% | ||||||||||
Maximum amount of proceeds allowed from the issuance of preferred stock from the ATM program | $ 100,000 | ||||||||||
Common Stock [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Common stock, shares authorized | 188,040 | 188,040 | 188,040 | 188,040 | |||||||
Common stock, shares issued | 93,869 | 93,869 | 93,869 | 81,503 | |||||||
Common stock, shares outstanding | 93,869 | 93,869 | 93,869 | 81,503 | |||||||
Cash raised from issuance of common stock under DRIP | $ 40,600 | ||||||||||
Dividend paid | $ 0.17 | $ 0.34 | $ 0.34 | ||||||||
Excess Stock [Member] | |||||||||||
Subsidiary or Equity Method Investee [Line Items] | |||||||||||
Excess stock, shares authorized | 200,000 | 200,000 | 200,000 | 200,000 | |||||||
Excess Stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||||||
Excess Stock, shares issued | 0 | 0 | 0 | 0 | |||||||
Excess Stock, shares outstanding | 0 | 0 | 0 | 0 |
Fair Value Measurements (Detail
Fair Value Measurements (Details Narrative) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 |
Fixed rate mortgage notes payable | $ 754,123 | $ 711,546 |
Mortgage Notes Payable Fair Value [Member] | ||
Fixed rate mortgage notes payable at fair value | 753,700 | |
Fixed rate mortgage notes payable | $ 762,300 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Fair Value of Financial Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Sep. 30, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | $ 177,359 | $ 154,921 |
Fair Value Measurements [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 177,359 | 154,921 |
Fair Value Measurements [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Preferred Stock [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 13,787 | 7,310 |
Fair Value Measurements [Member] | Preferred Stock [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 13,787 | 7,310 |
Fair Value Measurements [Member] | Preferred Stock [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Preferred Stock [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Common Stock [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 163,569 | 147,608 |
Fair Value Measurements [Member] | Common Stock [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 163,569 | 147,608 |
Fair Value Measurements [Member] | Common Stock [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Common Stock [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 3 | 3 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 3 | 3 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | 0 | 0 |
Fair Value Measurements [Member] | Mortgage Backed Securities [Member] | Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Securities Available for Sale at Fair Value | $ 0 | $ 0 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Details Narrative) - USD ($) $ in Thousands | 6 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | ||
Cash paid for interest | $ 18,100 | $ 15,100 |
Amount of dividend reinvested | $ 8,500 | $ 6,000 |
Contingencies and Commitments (
Contingencies and Commitments (Details Narrative) $ in Thousands | 6 Months Ended |
Mar. 31, 2019USD ($)ft²$ / ft² | |
Industrial Building [Member] | Two Mortgage Loans [Member] | |
Contingencies and Commitments [Line Items] | |
Mortgage loans amortization period | 17 years 3 months 19 days |
Mortgage loans committed on real estate, carrying amount of mortgage | $ 69,500 |
Weighted average fixed interest rate, percentage | 4.27% |
Industrial Building [Member] | Minimum [Member] | Two Mortgage Loans [Member] | |
Contingencies and Commitments [Line Items] | |
Mortgage loans amortization period | 15 years |
Weighted average fixed interest rate, percentage | 4.25% |
Industrial Building [Member] | Maximum [Member] | Two Mortgage Loans [Member] | |
Contingencies and Commitments [Line Items] | |
Mortgage loans amortization period | 18 years |
Weighted average fixed interest rate, percentage | 4.27% |
Monroe, OH [Member] | |
Contingencies and Commitments [Line Items] | |
Lease term | 15 years |
Face amount of original mortgage | $ 6,900 |
Original mortgage loan on real estate, interest rate | 3.77% |
Square feet of expansion to industrial building | ft² | 155,000 |
Expansion costs | $ 8,600 |
Extended prior lease expiration date | February 2030 to February 2034 |
Rent prior to expansion | $ 980 |
Increase in rent from expansion | $ 821 |
Rent prior to expansion, per square foot | $ / ft² | 4.22 |
Rent increased to after expansion | $ 1,800 |
Rent increased to expansion per square foot | $ / ft² | 4.65 |
Average annualized rent over the term of lease | $ 2,100 |
Increase in annual rent per year | 2.00% |
Mortgage loan maturity description | The maturity of the second mortgage loan will coincide with the maturity of the property’s first fully-amortizing mortgage loan |
Monroe, OH [Member] | Second Mortgage Loan [Member] | |
Contingencies and Commitments [Line Items] | |
Mortgage loan amortization period | 10 years 9 months 18 days |
Original mortgage loan on real estate, interest rate | 3.85% |
Future Corporate Office Space [Member] | 4th Quarter of Fiscal 2019 [Member] | |
Contingencies and Commitments [Line Items] | |
Lease term | 10 years |
Square feet to be rented | ft² | 13,000 |
Initial annual rent | $ 410 |
Annual rent per square foot | $ / ft² | 31 |
Existing Corporate Office Space [Member] | |
Contingencies and Commitments [Line Items] | |
Lease term | 2 years 6 months |
Square feet | ft² | 5,700 |
Gross annual rent | $ 137 |
Annual rent per square foot | $ / ft² | 24.17 |
Property Purchase Agreement [Member] | Industrial Building [Member] | |
Contingencies and Commitments [Line Items] | |
Square feet of industrial buildings to be purchased | ft² | 1,900,000 |
Weighted average lease term | 13 years 8 months 12 days |
Aggregate purchase price of industrial properties | $ 245,900 |
Property Purchase Agreement [Member] | Industrial Building [Member] | Minimum [Member] | |
Contingencies and Commitments [Line Items] | |
Lease term | 10 years |
Property Purchase Agreement [Member] | Industrial Building [Member] | Maximum [Member] | |
Contingencies and Commitments [Line Items] | |
Lease term | 15 years |
Property Purchase Agreement [Member] | FedEx Ground Package System, Inc [Member] | |
Contingencies and Commitments [Line Items] | |
Square feet of industrial buildings to be purchased | ft² | 772,000 |
Percentage of total square feet of industrial buildings to be purchased | 41.00% |
Properties lease expiration period | 15 years |
Property Purchase Agreement [Member] | Amazon.Com Services, Inc. [Member] | |
Contingencies and Commitments [Line Items] | |
Square feet of industrial buildings to be purchased | ft² | 613,000 |
Percentage of total square feet of industrial buildings to be purchased | 32.00% |
Properties lease expiration period | 15 years |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) $ / shares in Units, shares in Thousands, $ in Thousands | May 01, 2019USD ($)$ / ft² | Apr. 02, 2019$ / shares | Apr. 30, 2019USD ($) | Apr. 25, 2019USD ($)$ / sharesshares | Mar. 31, 2019ft²$ / ft² |
Liberty (Kansas City), MO [Member] | Holland 1916, Inc. [Member] | |||||
Subsequent Event [Line Items] | |||||
Area of property | ft² | 96,000 | ||||
Dakota Bodies, LLC [Member] | |||||
Subsequent Event [Line Items] | |||||
Former straight-line annualized rent per square foot | $ / ft² | 3.46 | ||||
Former cash rent per square foot | $ / ft² | 3.68 | ||||
Subsequent Event [Member] | Dakota Bodies, LLC [Member] | |||||
Subsequent Event [Line Items] | |||||
Lease term | 7 years | ||||
Annual rent | $ | $ 372 | ||||
Annual rent per square foot | $ / ft² | 3.85 | ||||
Increase in annual rent per year | 3.00% | ||||
Straight-line annualized rent | $ | $ 407 | ||||
Straight-line annualized rent per square foot | $ / ft² | 4.21 | ||||
Increase in straight-line annualized rent per square foot | 21.70% | ||||
Increase in cash rent per square foot | 4.60% | ||||
Number of preferred shares sold | shares | 247 | ||||
Weighted average price per share | $ / shares | $ 24.04 | ||||
Proceeds from Underwritten Public Offering of 6.125% Series C Preferred Stock, net of offering costs | $ | $ 5,800 | ||||
Subsequent Event [Member] | Lebanon, TN [Member] | |||||
Subsequent Event [Line Items] | |||||
Annual interest rate | 7.60% | ||||
Mortgage paid off | $ | $ 7,100 | ||||
Subsequent Event [Member] | Board of Directors [Member] | Common Shareholders [Member ] | |||||
Subsequent Event [Line Items] | |||||
Dividend declared per share | $ / shares | $ 0.17 | ||||
Dividend declaration date | Apr. 2, 2019 | ||||
Dividends payable, date to be paid | Jun. 17, 2019 | ||||
Dividend payable date of record | May 15, 2019 | ||||
Subsequent Event [Member] | Board of Directors [Member] | Series C Preferred Shareholders [Member] | |||||
Subsequent Event [Line Items] | |||||
Dividend declared per share | $ / shares | $ 0.3828125 | ||||
Dividend declaration date | Apr. 2, 2019 | ||||
Dividends payable, date to be paid | Jun. 17, 2019 | ||||
Dividend payable date of record | May 15, 2019 | ||||
Preferred stock, dividend rate | 6.125% |