FREIT (OTC: FREVS) pursues liquidation, estimating $24.44–$30.03 per share
Rhea-AI Filing Summary
First Real Estate Investment Trust of New Jersey has approved a Plan of Voluntary Liquidation that, if stockholders consent, will wind down the Trust through the sale of all assets and eventual dissolution. The Trust currently estimates total liquidating distributions of $24.44 to $30.03 per share, compared with a closing stock price of $15.25 on May 13, 2026.
The Board expects to seek stockholder approval at a special meeting in Fall 2026 and aims to complete asset sales within 24 months of approval. An amended management agreement provides Hekemian & Co. a termination fee equal to the Trust’s ownership percentage times 2.5 times one year’s Base Management Fee per property, plus a 1.65% sales fee on the Trust’s ownership share of each property’s sale price. CEO Robert S. Hekemian, Jr. may receive a $1,000,000 cash bonus if all properties are sold or under contract within 18 months after stockholder approval and aggregate gross proceeds exceed $319.9 million, with all sales closing.
Positive
- Board-backed liquidation with implied premium: Estimated liquidating distributions of $24.44–$30.03 per share compare with a $15.25 pre-announcement stock price, signaling Board and advisor expectations of value realization above the prior trading level, subject to execution and market risks.
Negative
- None.
Insights
FREIT is pivoting from ongoing operations to a value‑realizing liquidation.
FREIT has chosen a full liquidation strategy, targeting liquidating distributions of $24.44–$30.03 per share versus a pre‑announcement price of $15.25. That indicates the Board and its advisors see embedded asset value above the trading price, contingent on execution and market conditions.
The Plan of Voluntary Liquidation requires majority stockholder approval, with a special meeting expected in Fall 2026. The Trust aims to complete sales within 24 months after approval, but the materials emphasize that timing, proceeds and costs may differ from estimates due to transaction expenses, market risks and potential use of a liquidating trust.
Economically, the amended management agreement and a $1,000,000 bonus for CEO Robert S. Hekemian, Jr., tied to achieving at least $319.9 million in gross sale proceeds within 18 months, align manager and executive incentives with timely asset sales at targeted values. Actual outcomes will depend on property‑level demand across FREIT’s residential, commercial and land holdings in New Jersey and New York and on broader real estate and capital‑market conditions.
8-K Event Classification
Key Figures
Key Terms
Plan of Voluntary Liquidation financial
liquidating trust financial
Base Management Fee financial
real estate investment trust financial
proxy statement regulatory
forward-looking statements regulatory
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What did FREIT (FREVS) announce in this 8-K filing?
When does FREIT expect to complete the asset sales under the liquidation plan?
How will FREIT’s external manager be compensated during the liquidation?
What properties are included in FREIT’s liquidation plan?
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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Item 1.01 Entry into a Material Definitive Agreement.
Third Amendment to Management Agreement
On May 13, 2026, First Real Estate Investment Trust of New Jersey, Inc. (the “Company” or “FREIT”) entered into a Third Amendment to the Management Agreement dated November 1, 2001 between the Company and Hekemian & Company, Inc. (“Hekemian & Co.”), the external manager of the Company. The Third Amendment provides that upon the closing of any sale or other disposition of the Company’s entire direct or indirect interest in each property managed by Hekemian & Co, including sales or dispositions of a managed property in furtherance of the Plan of Voluntary Liquidation discussed in Item 8.01 below, the Management Agreement shall automatically terminate with respect to such property and the Company shall pay to Hekemian & Co. (a) any and all commissions and fees for management services and reimbursement required to be paid by the Company pursuant to the Management Agreement in respect of the applicable property up to the termination date, calculated on a pro rata basis plus (b) a termination fee in respect to such property equal to the product of (x) the Company’s direct or indirect percentage ownership interest in such property times (y) 2.5 times (z) one (1) year’s Base Management Fee in respect of such property. The Base Management Fee is computed by dividing the annual base management fee allocable to the applicable property paid by the Company to Hekemian & Co. over the immediately prior three (3) fiscal years prior to such termination by three (3).
Upon the closing of any sale or other disposition of the Company’s entire direct or indirect interest in a managed property, including sales or dispositions in furtherance of the Plan of Voluntary Liquidation discussed in Item 8.01 below, the Company is required to pay to Hekemian & Co. a fee equal to 1.65% of the sales price for the property. In the event a property is not wholly owned, directly or indirectly, by the Company, the sales fee payable to Hekemian & Co. shall only be payable in respect of the Company’s percentage ownership share of the applicable property.
Incentive Compensation Arrangement
To provide an incentive to Robert S. Hekemian, Jr., Chief Executive Officer, President and a director of the Trust, to facilitate the timely sale of the Trust’s properties, the Board of Directors has approved an incentive compensation arrangement that will entitle Mr. Hekemian to a $1,000,000 cash bonus if the Trust sells and/or enters into contracts to sell all of its real properties within 18 months after the approval of the Plan of Liquidation discussed in Item 8.01 below by the Trust’s stockholders and receives aggregate gross proceeds from such sales in excess of $319.9 million. To receive the bonus, the sale of all of the Trust’s properties must close.
Item 8.01 Other Events
Approval of Plan of Voluntary Liquidation
On May 12, 2026, the Board of Directors of the Company unanimously determined advisable and approved a Plan of Voluntary Liquidation (the “Plan of Voluntary Liquidation”). The Plan of Voluntary Liquidation provides for the Company’s complete liquidation and dissolution in accordance with Section 331, Section 336 and Section 346(a) of the Internal Revenue Code of 1986, as amended, and the Maryland General Corporation Law. Effectiveness of the Plan of Voluntary Liquidation is subject to approval by the affirmative vote of the holders of Common Stock entitled to cast a majority of all the votes entitled to be cast on the matter. FREIT currently anticipates that the Plan of Voluntary Liquidation will be submitted for stockholder approval at a special meeting of the stockholders, expected to occur in the Fall of 2026.
Upon the effectiveness of the Plan of Voluntary Liquidation and pursuant thereto, the Company is authorized to sell, convey, transfer and deliver or otherwise dispose of, or cause its subsidiaries to sell, convey, transfer and deliver or otherwise dispose, all of their remaining assets, without further approval of the stockholders. The Plan of Voluntary Liquidation further provides that upon a determination of the Board, the Company may transfer and assign any remaining assets of the Company and its subsidiaries to a liquidating trust (a “Liquidating Trust”), subject to the terms of the Plan of Voluntary Liquidation, and the Board may cause the Company to make the final distribution to the Company’s stockholders as a distribution in kind of beneficial interests in the Liquidating Trust, at such time as the Board deems appropriate or advantageous in its discretion.
The Plan of Voluntary Liquidation is attached hereto as Exhibit 2.1.
Forward-Looking Statements
This current report on Form 8-K may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements can be identified by the use of words such as “expect,” “plan,” “will,” “estimate,” “project,” “intend,” “believe,” “guidance,” “approximately,” “anticipate,” “may,” “should,” “seek” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions of management. These forward-looking statements are subject to known and unknown risks and uncertainties that you should not rely on as predictions of future events. Forward-looking statements depend on assumptions, data and/or methods which may be incorrect or imprecise, and we may not be able to realize them. The following risks and uncertainties, among others, could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited to: the possibility that FREIT’s stockholders do not approve the Plan of Voluntary Liquidation; changes in the amount and timing of the total liquidating distributions, including as a result of unexpected levels of transaction costs, delayed or terminated closings, liquidation costs or unpaid or additional liabilities and obligations; the possibility of converting to a liquidating trust;; the occurrence of any event, change or other circumstances that could give rise to the termination of the Plan of Voluntary Liquidation; industry and economic conditions; the Company’s dependence upon its external manager to conduct its business and achieve its investment objectives; unknown liabilities acquired in connection with acquired properties or interests in real estate-related entities; general risks affecting the real estate industry and local real estate markets (including, without limitation, the market value of the Company’s properties, potential illiquidity of the Company’s remaining real estate investments, condemnations, and potential damage from natural disasters); the financial performance of the Company’s tenants; the impact of any financial, accounting, legal or regulatory issues or litigation that may affect the Company and its major tenants; volatility and uncertainty in the financial markets, including potential fluctuations in the consumer price index; risks associated with the Company’s failure to maintain status as a REIT under the Internal Revenue Code of 1986, as amended; and other additional risks discussed in the Company’s annual report on Form 10-K for the fiscal year ended October 31, 2025 or and subsequent Quarterly Reports on Form 10-Q and other documents FREIT files from time to time with the SEC. The Company expressly disclaims any responsibility to update or revise forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
In addition, our current and continuing qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code of 1986, as amended, and depends on our ability to meet the various requirements imposed by the Code through actual operating results, distribution levels and diversity of stock ownership.
Additional Information and Where to Find It
This communication relates to the proposed plan of voluntary liquidation of FREIT, and may be deemed to be solicitation material. In connection with the Plan of Voluntary Liquidation, FREIT intends to file a proxy statement (the “Proxy Statement”) with the Securities and Exchange Commission (the “SEC”). The Proxy Statement will be sent to all stockholders of FREIT. FREIT will also file other documents regarding the Plan of Voluntary Liquidation with the SEC. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND STOCKHOLDERS OF FREIT ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO AND ANY DOCUMENTS INCORPORATED BY REFERENCE THEREIN) AND ALL OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE PLAN OF VOLUNTARY LIQUIDATION AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PLAN OF VOLUNTARY LIQUIDATION.
Investors and stockholders of FREIT may obtain copies of the Proxy Statement and other documents that are filed or will be filed by FREIT with the SEC, free of charge, through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed by FREIT with the SEC will also be available, free of charge, on FREIT’s website at https://freitnj.com/investor-relations/.
Participants in the Solicitation
FREIT, certain of its directors, executive officers and other employees may be deemed to be participants in the solicitation of proxies from FREIT’s stockholders in connection with the proposed Plan of Voluntary Liquidation. Information about FREITS directors and executive officers and their ownership of FREIT’s common stock is set forth in FREITs Annual Report on Form 10-K filed with the SEC on January 29, 2026. To the extent that holdings of FREIT’s securities have changed since the amounts reported in Annual Report on Form 8-K, such changes have been or will be reflected on Statements of Changes in Beneficial Ownership on Form 4 filed with the SEC. Additional information regarding the interests of those persons and other persons who may be deemed participants in the proposed Plan of Voluntary Liquidation may be obtained by reading the Proxy Statement regarding the proposed Plan of Voluntary Liquidation when it becomes available. You may obtain free copies of these documents using the sources indicated above.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
2.1 Plan of Voluntary Liquidation
99.1 Press release dated May 14, 2026
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: May 14, 2026
Exhibit 99.1
FREIT BOARD OF DIRECTORS APPROVES PLAN OF VOLUNTARY
LIQUIDATION TO MAXIMIZE
VALUE FOR STOCKHOLDERS
Current Estimate of Distributions to Stockholders is Approximately $24.44 to $30.03 Per Share;
Representing Significant Premium to Latest Closing Stock Price
HACKENSACK, NJ, May 14, 2026 – First Real Estate Investment Trust of New Jersey, Inc. (“FREIT” or the “Trust”) announced today that its Board of Directors (the “Board”) has unanimously approved a plan of voluntary liquidation, which provides for the voluntary liquidation and dissolution of the Trust by the sale, conveyance, transfer or disposition of all of the Trust’s assets (the “Plan”). FREIT intends to file a preliminary proxy statement with the Securities and Exchange Commission (“SEC”) describing the Plan. The Plan is subject to the approval of the Trust’s stockholders, and the Trust plans to convene a meeting of its stockholders in the Fall of 2026 to approve the Plan.
“After a diligent exploration of various strategic alternatives, the Board determined that the voluntary and orderly liquidation of the Trust’s assets is the most attractive path to maximizing stockholder value,” said Ronald Artinian, Chairman of the Board. “The Board and its advisors are focused on maximizing the value of our assets and we look forward to sharing additional details with stockholders.”
The Trust intends to return net proceeds from the sale of its assets to its stockholders when appropriate (in the Board’s discretion), subject to payment of (and the creation of reserves for) the Trust’s liabilities and obligations and the payment of expenses. The Trust has estimated that the net proceeds that will be distributed to the Trust’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.
“For almost seventy years, FREIT has delivered consistent and attractive returns for investors,” stated Robert S. Hekemian, Jr., Chief Executive Officer. “We are proud of the Company’s legacy and look forward to punctuating it by returning capital to stockholders in a favorable real estate environment. This structure allows for the acceleration of asset sales while establishing the most tax efficient manner for monetizing the Trust’s assets, to the benefit of our stockholders.”
FREIT’s current portfolio includes seven residential properties located in New Jersey and New York, five commercial properties located in New Jersey, and three parcels of vacant land located in New Jersey. FREIT will endeavor to complete the sale, conveyance, transfer or disposition of its assets within 24 months of the date of the adoption of the Plan by FREIT’s stockholders.
This estimate of the aggregate net proceeds to be distributed is subject to certain assumptions and other estimates, which will be described in the Trust’s proxy statement to be utilized in connection with a meeting of the Trust’s stockholders to be convened to approve the Plan. These assumptions and estimates may not prove to be accurate, which could cause the actual distributions to be less or more than this estimated range. In addition, the timing of the sales of the Trust’s assets and distributions is uncertain.
Jones Lang LaSalle Securities, LLC, an affiliate of Jones Lang LaSalle Americas, Inc., is acting as financial advisor to the Trust in connection with the Plan.
Additional Information and Where to Find It
This press release relates to the proposed liquidation and dissolution of FREIT, and may be deemed to be solicitation material in respect of the proposed transaction and proposed liquidation and dissolution. In connection with proposed liquidation and dissolution, FREIT will file a proxy statement (the “Proxy Statement”) with the Securities and Exchange Commission (the “SEC”), as well as other relevant materials. This press release is not a substitute for the Proxy Statement or for any other document that FREIT has filed or may file with the SEC or send to FREIT’s stockholders in connection with proposed liquidation and dissolution. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND STOCKHOLDERS OF FREIT ARE URGED TO READ THE PROXY STATEMENT AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED LIQUIDATION AND DISSOLUTION AND RELATED MATTERS. Investors and stockholders will be able to obtain copies of the Proxy Statement and other documents filed by FREIT with the SEC, free of charge, through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed by FREIT with the SEC will also be available, free of charge, on the investor relations page of FREIT’s website at www.freitnj.com. FREIT and its Directors and executive officers may be considered participants in the solicitation of proxies from FREIT’s stockholders with respect to proposed liquidation and dissolution under the rules of the SEC. Information about the Directors and executive officers of FREIT is set forth in FREIT’s annual report on Form 10-K for the fiscal year ended October 31, 2025 filed with the SEC and in other documents filed with the SEC. Additional information regarding persons who may be deemed participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will also be included in the Proxy Statement and other relevant materials to be filed with the SEC when they become available.
Forward-Looking and Cautionary Statements
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements can be identified by the use of words such as “expect,” “plan,” “will,” “estimate,” “project,” “intend,” “believe,” “guidance,” “approximately,” “anticipate,” “may,” “should,” “seek” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions of management. These forward-looking statements are subject to known and unknown risks and uncertainties that you should not rely on as predictions of future events. Forward-looking statements depend on assumptions, data and/or methods which may be incorrect or imprecise and we may not be able to realize them. The following risks and uncertainties, among others, could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited to: the possibility that FREIT’s stockholders do not approve the plan of voluntary liquidation; changes in the amount and timing of the total liquidating distributions, including as a result of unexpected levels of transaction costs, delayed or terminated closings, liquidation costs or unpaid or additional liabilities and obligations; the possibility of converting to a liquidating trust; the occurrence of any event, change or other circumstances that could give rise to the termination of the plan of voluntary liquidation; industry and economic conditions; FREIT’s dependence upon its external manager to conduct its business and achieve its investment objectives; unknown liabilities acquired in connection with acquired properties or interests in real estate-related entities; general risks affecting the real estate industry and local real estate markets (including, without limitation, the market value of FREIT’s properties, potential illiquidity of FREIT’s remaining real estate investments, condemnations, and potential damage from natural disasters); the financial performance of FREIT’s tenants; the impact of any financial, accounting, legal or regulatory issues or litigation that may affect FREIT and its major tenants; volatility and uncertainty in the financial markets, including potential fluctuations in the consumer price index; risks associated with FREIT’s failure to maintain status as a REIT under the Internal Revenue Code of 1986, as amended; and other additional risks discussed in FREIT’s annual report on Form 10-K for the fiscal year ended October 31, 2025 filed with the SEC. FREIT expressly disclaims any responsibility to update or revise forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
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 Shareholder Relations at (201) 488-6400
Visit us on the web: www.freitnj.com
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