First Real Estate Trust approves liquidation, $24–$30/sh
FREVS posted higher GAAP earnings on a property sale, approved a voluntary liquidation plan with an estimated payout premium, but reported lower FFO and AFFO.
Rhea-AI Filing Summary
FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY, INC. (FREVS) reported strong GAAP results for the fiscal quarter ended July 31, 2026, driven by a major asset sale and a planned liquidation. Total real estate revenue for the quarter rose 4.0% to approximately $7.5 million, while net income attributable to common equity jumped to about $20.2 million, or $2.69 per share, from $0.9 million, or $0.12 per share, largely due to a roughly $19.8 million gain on the sale of the Franklin Crossing shopping center for $27.0 million.
For the nine months ended July 31, 2026, total real estate revenue increased 4.2% to about $22.7 million and net income attributable to common equity rose to approximately $21.7 million, or $2.90 per share, from $2.4 million, or $0.32 per share. However, cash-flow-based metrics softened, with FFO per share declining to $0.16 from $0.25 for the quarter and AFFO per share to $0.14 from $0.23. The board unanimously approved a Plan of Voluntary Liquidation, estimating net distributions to stockholders in a range of $24.44 to $30.03 per share, compared with a closing share price of $15.25 on May 13, 2026, and declared a $0.10 third-quarter dividend.
Positive
- Estimated liquidation payouts far above prior trading price, with the company projecting distributions of $24.44–$30.03 per share versus a closing price of $15.25 on May 13, 2026, the day before announcing the Plan of Voluntary Liquidation.
- Major asset sale realized significant gain and cash, as Franklin Crossing shopping center sold for $27.0 million, generating approximately $25.4 million in net proceeds and a net gain of about $19.8 million.
- Revenues and GAAP net income increased meaningfully, with total real estate revenue up 4.0% for the quarter to roughly $7.5 million and net income attributable to common equity rising to about $20.2 million from $0.9 million a year earlier.
Negative
- FFO and AFFO declined year over year, as quarterly FFO fell to $1.2 million or $0.16 per share from $1.9 million or $0.25 per share, and AFFO decreased to $1.1 million or $0.14 per share from $1.7 million or $0.23 per share.
- Residential operating performance softened, with AFFO per share for the nine months declining to $0.51 from $0.62 and average residential occupancy edging down to 95.8% from 96.9% over the same period.
- Commercial portfolio remains thinly occupied, with total average commercial occupancy at 41.7% for the quarter and 39.6% for the nine months ended July 31, 2026, despite modest improvement from the prior year.
Filing Explained
Westwood Plaza remains a pending sale, while an undrawn $20 million credit line and debt changes affect financing before the liquidation vote.
The proposed Westwood Plaza sale for
Financing changes include extending the
The liquidation plan has not yet become effective: stockholder approval is scheduled for
8-K Event Classification
Key Figures
Key Terms
Funds From Operations financial
Adjusted Funds From Operations financial
Plan of Voluntary Liquidation regulatory
tenancy-in-common financial
interest reserve escrow account financial
Earnings Snapshot
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How did FREVS perform financially in the quarter ended July 31, 2026?
What drove the large earnings increase for FREVS in Q3 2026?
How did FREVS’s FFO and AFFO change compared with the prior year?
What dividend did FREVS declare for the third quarter of fiscal 2026?
What financing changes did FREVS report in this 8-K?
What are FREVS’s latest occupancy levels for residential and commercial properties?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) |
(IRS
Employer Identification No.) | |
| |
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| (Address of principal executive offices) | (Zip Code) | ||
Registrant’s telephone number, including area
code:
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2 (b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4 (c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| OTC Pink Limited Market | ||
| (1) | Registered pursuant to Section 12 (b) of the Act pursuant to a form 8-A filed by the registrant on August 3, 2023. Until the Distribution Date (as defined in the registrant’s Stockholder Rights Agreement dated July 31, 2023 and amended as of May 13, 2026) the Preferred Stock Purchase Rights will be transferred with and only with the shares of the registrant’s Common Stock to which the Preferred Stock Purchase Rights are attached. |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Item 2.02 Results of Operations and Financial Condition
OPERATING RESULTS
The registrant has released its operating results for the fiscal quarter ended July 31, 2026. The Press Release is included as Exhibit 99.1 to this Form 8-K.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
99.1 Registrant’s press release dated September 11, 2026
The statements in this report, which relate to future earnings or performance, are forward-looking. Actual results may differ materially and be adversely affected by such factors as market and economic conditions, longer than anticipated lease-up periods or the inability of certain tenants to pay rents. Additional information about these factors is contained in the Company’s filings with the SEC including the Company’s most recently filed reports on Form 10-K and Form 10-Q.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY, INC. | ||
| (Registrant) | ||
| By: | /s/ Robert S. Hekemian, Jr. | |
| Robert S. Hekemian, Jr. | ||
| President and Chief Executive Officer | ||
Date: September 11, 2026
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EXHIBIT INDEX
| Exhibit | |
| Number | Description |
| 99.1 | Press Release – Operating results for the fiscal quarter and nine months ended July 31, 2026. |
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FREIT Announces Third Quarter Fiscal Year 2026 Results
HACKENSACK, NJ, September 11, 2026 – First Real Estate Investment Trust of New Jersey, Inc. (“FREIT” or the “Company”) announced its operating results for the fiscal quarter ended July 31, 2026.
| FINANCIAL HIGHLIGHTS & OPERATING STATISTICS | |||||
| For the Fiscal Quarter Ended | For the Nine Months Ended | ||||
| July 31, | July 31, | ||||
| 2026 | 2025 | 2026 | 2025 | ||
| GAAP Earnings Per Share - Basic and Diluted | $2.69 | $0.12 | $2.90 | $0.32 | |
| AFFO Per Share - Basic and Diluted | $0.14 | $0.23 | $0.51 | $0.62 | |
| Dividends Per Share | $0.10 | $0.10 | $0.30 | $0.26 | |
| Total Average Residential Occupancy | 96.3% | 96.9% | 95.8% | 96.9% | |
| Total Average Commercial Occupancy * | 41.7% | 39.2% | 39.6% | 39.5% | |
| * Average occupancy rate excludes the Franklin Crossing shopping center from all periods presented as the property was sold in the fiscal quarter ended July 31, 2026. | |||||
Third Quarter Financial Results
Total real estate revenue increased 4.0% to approximately $7.5 million for the fiscal quarter ended July 31, 2026, compared to approximately $7.2 million for the prior-year period. The increase was driven by an increase of approximately $230,000 in residential revenue from higher base rents, despite a slight decline in average occupancy from 96.9% to 96.3%, and an increase of approximately $70,000 in commercial revenue.
Net income attributable to common equity (“Net Income”) was approximately $20.2 million, or $2.69 per share, for the fiscal quarter ended July 31, 2026, compared to approximately $0.9 million, or $0.12 per share, for the prior-year period. The increase was primarily driven by the net gain on sale of the Franklin Crossing shopping center which was sold on July 8, 2026.
(Refer to “Table of Revenue & Net Income Components”)
Nine Months Financial Results
Total real estate revenue increased 4.2% to approximately $22.7 million for the nine months ended July 31, 2026, compared to approximately $21.8 million for the prior-year period. The increase was driven by an increase of approximately $530,000 in residential revenue from higher base rents, despite a modest decline in average occupancy from 96.9% to 95.8%, and an increase of approximately $380,000 in commercial revenue primarily driven by additional rent from TJ Maxx at the Westwood Plaza shopping center following the expiration of its co-tenancy clause.
Net Income was approximately $21.7 million, or $2.90 per share, for the nine months ended July 31, 2026, compared to approximately $2.4 million, or $0.32 per share, in the prior-year period. The increase was primarily driven by the net gain on sale of the Franklin Crossing shopping center.
(Refer to “Table of Revenue & Net Income Components”)
Table of Revenue & Net Income Components
| For the Fiscal Quarter Ended July 31, | For the Nine Months Ended July 31, | |||||||||||||||||||||||
| 2026 | 2025 | Change | 2026 | 2025 | Change | |||||||||||||||||||
| (In Thousands Except Per Share Amounts) | (In Thousands Except Per Share Amounts) | |||||||||||||||||||||||
| Revenue: | ||||||||||||||||||||||||
| Commercial properties | $ | 1,846 | $ | 1,778 | $ | 68 | $ | 5,878 | $ | 5,502 | $ | 376 | ||||||||||||
| Residential properties | 5,691 | 5,466 | 225 | 16,797 | 16,269 | 528 | ||||||||||||||||||
| Total real estate revenues | 7,537 | 7,244 | 293 | 22,675 | 21,771 | 904 | ||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||
| Real estate operating expenses | 3,646 | 3,602 | 44 | 11,157 | 10,803 | 354 | ||||||||||||||||||
| General and administrative expenses | 1,376 | 624 | 752 | 3,141 | 2,260 | 881 | ||||||||||||||||||
| Depreciation | 681 | 738 | (57 | ) | 2,126 | 2,195 | (69 | ) | ||||||||||||||||
| Total operating expenses | 5,703 | 4,964 | 739 | 16,424 | 15,258 | 1,166 | ||||||||||||||||||
| Financing costs | (1,973 | ) | (1,808 | ) | (165 | ) | (5,634 | ) | (5,532 | ) | (102 | ) | ||||||||||||
| Investment income | 297 | 303 | (6 | ) | 846 | 1,053 | (207 | ) | ||||||||||||||||
| Loss on investment in tenancy-in-common | (37 | ) | (36 | ) | (1 | ) | (106 | ) | (13 | ) | (93 | ) | ||||||||||||
| Net gain on sale of property | 19,825 | — | 19,825 | 19,825 | — | 19,825 | ||||||||||||||||||
| Net income | 19,946 | 739 | 19,207 | 21,182 | 2,021 | 19,161 | ||||||||||||||||||
| Net loss attributable to noncontrolling interests in subsidiaries | 215 | 140 | 75 | 538 | 366 | 172 | ||||||||||||||||||
| Net income attributable to common equity | $ | 20,161 | $ | 879 | $ | 19,282 | $ | 21,720 | $ | 2,387 | $ | 19,333 | ||||||||||||
| Earnings per share: | ||||||||||||||||||||||||
| Basic and diluted | $ | 2.69 | $ | 0.12 | $ | 2.57 | $ | 2.90 | $ | 0.32 | $ | 2.58 | ||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||||||
| Basic and diluted | 7,482 | 7,471 | 7,477 | 7,468 | ||||||||||||||||||||
Segment Same Property Net Operating Income (“NOI”)
NOI for the residential properties increased to approximately $3,292,000 and $9,715,000 for the fiscal quarter and nine months ended July 31, 2026, respectively, from approximately $3,137,000 and $9,389,000 for the prior year’s comparable periods, respectively. Same property NOI for the commercial properties increased to approximately $239,000 and $574,000 for the fiscal quarter and nine months ended July 31, 2026, respectively, from approximately $97,000 and $319,000 for the prior year’s comparable periods, respectively.
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Purchase and Sale Agreements
On July 8, 2026, FREIT consummated the sale of the Franklin Crossing shopping center with an affiliate of Regency Centers Corporation for a purchase price of $27.0 million, resulting in net proceeds of approximately $25.4 million and a net gain of approximately $19.8 million.
On May 26, 2026, FREIT entered into a purchase and sale agreement with an affiliate of Regency Centers Corporation to sell the Westwood Plaza shopping center for $28.8 million. The purchaser is in the initial due diligence period and this transaction is expected to close in early 2027.
Adoption of Plan of Voluntary Liquidation
On May 12, 2026, FREIT’s Board unanimously approved a Plan of Voluntary Liquidation (the “Plan”), which provides for the Company’s complete liquidation and dissolution under applicable tax and Maryland law. The Company will seek stockholder approval for the Plan at a special meeting scheduled to be held on September 29, 2026. Upon effectiveness, the Company may dispose of the assets without further stockholder approval or transfer the remaining assets to a liquidating trust, with stockholders receiving cash and/or beneficial interests in the trust, as determined by the Board. FREIT has estimated that the net proceeds that will be distributed to FREIT's stockholders over time in connection with the Plan, taking into account estimated transaction expenses and payment of liabilities, will be in the range of $24.44 per share to $30.03 per share, representing a significant premium to the closing stock price of $15.25 on May 13, 2026, the day prior to announcing the Plan. Jones Lang LaSalle Securities, LLC, an affiliate of Jones Lang LaSalle Americas, Inc., is acting as financial advisor to the Company in connection with the Plan.
Dividend
The Board of Directors declared a third quarter dividend of $0.10 per share on the common stock to holders of record at the close of business on August 31, 2026. The payment date for the dividend is September 14, 2026. The Board of Directors will continue to evaluate the dividend on a quarterly basis.
Financing Update
The loan on the Westwood Plaza shopping center, located in Westwood, New Jersey with a balance of approximately $9.5 million, was extended by the current lender of this loan, Valley National Bank, for an additional 90 days from August 1, 2026 to a new maturity date of November 1, 2026 under the same terms and conditions of the existing loan agreement.
On May 26, 2026, FREIT’s $13 million line of credit was replaced with a $20 million line of credit provided by Provident Bank and secured by a mortgage on FREIT’s Boulders apartment property in Rockaway, New Jersey. Draws against this credit line can be used for working capital needs and standby letters of credit. The line of credit will expire on October 31, 2029 and the interest rate on any amount outstanding will be based on a floating interest rate of prime minus 25 basis points with a floor of 6.75%. To date, the line of credit remains undrawn, providing full availability of $20 million.
Effective June 22, 2026, Wayne PSC entered into a loan extension and modification agreement with ConnectOne Bank and paid down this loan, secured by the Preakness shopping center, by approximately $5 million, reducing the outstanding balance to $20 million. Under the terms and conditions of this loan extension and modification, the maturity date of this loan is extended for five years to July 1, 2031, the interest rate on the outstanding debt is based on a fixed interest rate of 6.875% and monthly principal and interest payments of approximately $141,061 are required. Additionally, Wayne PSC replenished its interest reserve escrow account by $1,145,139, increasing the balance in this account from $404,861 to $1,550,000.
On August 31, 2026, Westwood Hills, LLC refinanced its mortgage, secured by an apartment building located in Westwood, New Jersey, in the amount of approximately $24,541,000 (which would have matured on September 1, 2026) with a new lender, ConnectOne Bank, in the amount of $25,000,000. This loan is based on a fixed interest rate of 6.28% and is interest only for the first three years of the term with monthly installments thereafter of approximately $131,000 each month through October 1, 2029. Commencing on November 1, 2029, monthly installments of principal plus interest totaling approximately $162,000 are required each month until September 1, 2031 at which time the unpaid balance is due.
Funds From Operations
Funds From Operations (“FFO”) is a non-GAAP measure defined by the National Association of Real Estate Investment Trusts (“NAREIT”). FREIT does not include distributions from equity/debt/capital gain sources in its computation of FFO. Although many consider FFO the standard measurement of a REIT’s performance, FREIT supplements the NAREIT computation to include other adjustments to GAAP net income, which are not considered by management to be the primary
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drivers of its decision-making process. These adjustments are straight-line rents and recurring capital improvements on FREIT’s residential apartments.
The modified FFO computation is referred to as Adjusted Funds From Operations (“AFFO”). FREIT believes that AFFO is a superior measure of its operating performance. FREIT computes FFO and AFFO as follows:
| For the Fiscal Quarter Ended July 31, | For the Nine Months Ended July 31, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (In Thousands Except Per Share Amounts) | (In Thousands Except Per Share Amounts) | |||||||||||||||
| Funds From Operations ("FFO") (a) | ||||||||||||||||
| Net income | $ | 19,946 | $ | 739 | $ | 21,182 | $ | 2,021 | ||||||||
| Net gain on sale of property | (19,825 | ) | — | (19,825 | ) | — | ||||||||||
| Depreciation of consolidated properties | 681 | 738 | 2,126 | 2,195 | ||||||||||||
| Amortization of deferred leasing costs | 21 | 22 | 65 | 67 | ||||||||||||
| Distributions to non-controlling interests | — | — | (c) | (540 | )(b) | (480 | )(c) | |||||||||
| Adjustment to loss on investment in tenancy-in-common for depreciation | 395 | 368 | 1,180 | 1,100 | ||||||||||||
| FFO | $ | 1,218 | $ | 1,867 | $ | 4,188 | $ | 4,903 | ||||||||
| Per Share - Basic and Diluted | $ | 0.16 | $ | 0.25 | $ | 0.56 | $ | 0.66 | ||||||||
| (a) As prescribed by NAREIT. | ||||||||||||||||
| (b) FFO excludes the additional distribution of proceeds to non-controlling interests in the amount of approximately $15,000 for the nine months ended July 31, 2026 related to the sale of the Rotunda property located in Maryland in a prior year. | ||||||||||||||||
| (c) FFO excludes the additional distribution of proceeds to non-controlling interests in the amount of approximately $2,000 and $165,000 for the fiscal quarter and nine months ended July 31, 2025, respectively, related to the sale of the Rotunda and Damascus properties located in Maryland in a prior year. | ||||||||||||||||
| Adjusted Funds From Operations ("AFFO") | ||||||||||||||||
| FFO | $ | 1,218 | $ | 1,867 | $ | 4,188 | $ | 4,903 | ||||||||
| Deferred rents (Straight lining) | (4 | ) | 27 | 6 | 83 | |||||||||||
| Capital Improvements - Apartments | (141 | ) | (154 | ) | (389 | ) | (357 | ) | ||||||||
| AFFO | $ | 1,073 | $ | 1,740 | $ | 3,805 | $ | 4,629 | ||||||||
| Per Share - Basic and Diluted | $ | 0.14 | $ | 0.23 | $ | 0.51 | $ | 0.62 | ||||||||
| Weighted Average Shares Outstanding: | ||||||||||||||||
| Basic and Diluted | 7,482 | 7,471 | 7,477 | 7,468 | ||||||||||||
FFO and AFFO do not represent cash generated from operating activities in accordance with accounting principles generally accepted in the United States of America and therefore should not be considered a substitute for net income as a measure of results of operations or for cash flow from operations as a measure of liquidity. Additionally, the application and calculation of FFO and AFFO by other REITs may vary materially from that of FREIT, and therefore FREIT’s FFO and AFFO may not be directly comparable to those of other REITs.
The statements in this report, which relate to future earnings or performance, are forward-looking. Actual results may differ materially and be adversely affected by such factors as market and economic conditions, longer than anticipated lease-up periods or the inability of certain tenants to pay rents. Additional information about these factors is contained in the Company’s filings with the SEC including the Company’s most recently filed reports on Form 10-K and Form 10-Q.
First Real Estate Investment Trust of New Jersey, Inc. is a publicly traded (over-the-counter – symbol FREVS) REIT organized in 1961. Its portfolio of residential and commercial properties is located in New Jersey and New York, with the largest concentration in northern New Jersey.
For additional information, contact Investor Relations at (201) 488-6400.
Visit us on the web: www.freitnj.com
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