<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the quarterly period ended June 30, 1994
OR
[ ] Transition Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Commission File Number 1-7172
BRT REALTY TRUST
(Exact name of registrant as specified in its charter)
Massachusetts 13-2755856
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
60 Cutter Mill Road, Great Neck, NY 11021
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(516) 466-3100
Indicate the number of shares outstanding of each of the issuer's
classes of stock, as of the latest practicable date.
7,346,624 Shares of Beneficial Interest,
$3 par value, and 1,030,000 shares of Series A
cumulative convertible preferred stock, $1 par
value outstanding on August 8, 1994
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports),and (2) has been subject to such filing
requirements for the past 90 days.
Yes __X___ No______
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<TABLE>
BRT REALTY TRUST AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands Except For Per Share Data)
<CAPTION>
June 30, Sept 30,
1994 1993
-------- --------
(Unaudited) (Audited)
<S> <C> <C>
Assets:
Real estate loans - Note 3:
Earning interest, less
unearned income of
$16 and $589 $ 83,493 $ 95,353
Not earning interest 7,056 26,750
-------- -------
90,549 122,103
Less allowance for
possible losses 11,186 22,637
------- -------
79,363 99,466
Real estate owned - Note 4:
Foreclosed properties held
for sale, (except for
$14,401 and $14,303 less
accumulated depreciation
of $368 and $146, which is
held long term for the
production of income) 55,423 51,162
Less valuation allowance 2,717 3,229
------- -------
52,706 47,933
------- -------
Cash and cash equivalents 4,890 1,962
Investments in U.S. Government
obligations, at cost, which
approximates market 3,556 7,094
Restricted cash 1,635 1,709
Interest receivable 758 893
Other assets 3,519 3,160
------- -------
Total assets $146,427 $162,217
======= =======
/TABLE
<PAGE>
<PAGE>
[CAPTION]
<TABLE>
Liabilities and Shareholders' Equity
<S> <C> <C>
Liabilities:
Notes payable $ 79,283 $ 92,785
Loans and mortgages payable,
nonrecourse 6,808 10,308
Accounts payable and accrued
liabilities, including deposits
of $2,598 and $2,331 4,182 3,935
------- -------
Total Liabilities 90,273 107,028
Deferred revenues 43 90
Shareholders' Equity - Note 2:
Preferred shares - $1 par value:
Authorized 10,000 shares,
Issued - 1,030 shares 1,030 1,030
Shares of beneficial interest,
$3 par value: Authorized number
of shares-unlimited
Issued - 7,538 shares 22,614 22,614
Additional paid-in capital
net of distributions of
$4,631 and $4,428 84,251 84,454
Accumulated deficit (49,449) (50,664)
------- -------
58,446 57,434
Cost of 192 treasury shares
of beneficial interest (2,335) (2,335)
------- -------
Total shareholders' equity 56,111 55,099
------- -------
Total liabilities and share-
holders' equity $146,427 $162,217
======= =======
<FN>
See Accompanying Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
BRT REALTY TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In Thousands)
<CAPTION>
Three Months Ended Nine Months Ended
June 30, June 30,
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Interest and fees on
real estate loans $ 2,283 $ 3,035 $ 7,127 $10,171
Operating income on real
estate owned 2,273 1,683 7,288 3,578
Gain on sale of fore-
closed properties held
for sale 1,356 29 1,507 161
Gain on sale of
marketable securities - - - 115
Other, primarily investment
income 71 81 240 248
------- ------- ------ ------
Total Revenues 5,983 4,828 16,162 14,273
------- ------- ------ ------
Expenses:
Interest-notes payable,
loans payable and
subordinated notes 1,712 1,887 5,059 5,860
Provision for possible
loan losses - 211 1,390 1,711
Provision for valuation
adjustment 993 1,413 993 3,138
Advisor's fee 265 320 825 999
General and administrative 889 753 2,520 2,549
Operating expenses relating
to real estate owned
including interest on
mortgages 1,218 768 3,787 2,062
Depreciation and
amortization 113 125 373 227
------- ------- ------- ------
Total Expenses 5,190 5,477 14,947 16,546
------- ------- ------- ------
Net Income (Loss) $ 793 $ (649) $ 1,215 $(2,273)
======= ======= ======= ====== <PAGE>
<PAGE>
<S> <C> <C> <C> <C>
Calculation of net
income (loss) applicable
to common shareholders:
Net Income (Loss) $ 793 $ (649) $ 1,215 $(2,273)
Less: distribution on
preferred stock 68 - 203 -
Net income (loss) ------- ------- ------- ------
applicable to common
shareholders $ 725 $ (649) $ 1,012 $(2,273)
======= ======= ======= ======
Income (loss) per share
of Beneficial
Interest - Note 2:
Primary $ .10 $ (.09) $ .14 $ (.31)
======= ======= ======= ======
Fully Diluted $ .09 $ (.09) $ .14 $ (.31)
======= ======= ======= ======
Weighted average number
of common shares
outstanding - Note 2:
Primary 7,346,624 7,346,624 7,346,624 7,346,624
========= ========= ========= =========
Fully Diluted 8,445,109 7,346,624 7,346,624 7,346,624
========= ========= ========= =========
STATEMENTS OF ACCUMULATED DEFICIT
Accumulated deficit,
beginning of period $(50,242) $(48,220) $(50,664)$(46,596)
Net Income (Loss) 793 (649) 1,215 (2,273)
------- ------- ------- ------
Accumulated deficit,
end of period $(49,449) $(48,869) $(49,449)$(48,869)
======= ======= ======= ======
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
BRT REALTY TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Thousands)
<CAPTION>
Nine Months Ended
June 30,
----------------
1994 1993
---- ----
<S> <C> <C>
Cash flow from operating activities:
Net income (loss) $ 1,215 $( 2,273)
Adjustments to reconcile net income
(loss) to net cash provided by
operating activities:
Provision for possible loan losses 1,390 1,711
Provision for valuation adjustment 993 3,138
Amortization and depreciation 373 227
Recognition of discount upon premature
payoff of real estate loan ( 565) -
Gain on sale of foreclosed properties (1,507) ( 161)
Gain on sale of marketable securities - ( 115)
Capitalization of earned interest
income to loan balance in accordance
with agreements ( 13) ( 24)
Decrease in interest receivable 135 629
(Decrease) increase in accounts
payable and accrued liabilities ( 87) 496
Decrease in deferred revenues ( 47) ( 159)
(Increase) decrease in rent and
other receivables ( 72) 272
(Increase) decrease in escrow deposits( 334) 717
Increase in deferred costs - ( 74)
Other ( 105) ( 498)
------- -------
Net cash provided by operating activities 1,376 3,886
------- -------
<PAGE>
<PAGE>
<S> <C> <C>
Cash flows from investing activities:
Collections from real estate loans 15,302 24,893
Proceeds from participating lenders - 172
Additions to real estate loans ( 903) ( 2,685)
Repayments to participating lenders (5,470) (13,527)
Net costs capitalized to real estate
owned (1,022) ( 1,567)
Proceeds from sale of real estate owned 8,769 3,502
Increase (decrease) in deposits payable 267 ( 411)
Decrease (increase) in investment in U.S.
Government obligations 3,538 ( 5,039)
Sale of marketable securities - 345
Other 1 ( 14)
------- -------
Net cash provided by investing activities 20,482 5,669
------- -------
Cash flow from financing activities:
Bank repayments (13,502) (11,015)
Payoff/paydown of loan and mortgages
payable ( 5,366) ( 109)
Decrease in restricted cash 74 161
Other ( 136) ( 11)
------- -------
Net cash used in financing activities (18,930) (10,974)
------- -------
Net increase (decrease) in cash and
cash equivalents 2,928 ( 1,419)
Cash and cash equivalents at beginning
of period 1,962 2,884
------- -------
Cash and cash equivalents at end of
period $ 4,890 $ 1,465
======= =======
<FN>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
<PAGE>
</TABLE>
<TABLE>
BRT REALTY TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Thousands)
<CAPTION>
Nine Months Ended
June 30,
----------------
1994 1993
---- ----
<S> <C> <C>
Supplemental disclosure of cash flow
information:
Cash paid during the period for
interest expense $ 5,679 $ 5,817
====== ======
Supplemental schedule of noncash
investing and financing activities:
Transfer of nonearning real estate
loans to foreclosed properties
at fair market value, including
in-substance foreclosures $17,745 $19,532
Nonrecourse mortgage obligations
relating to property acquired through
foreclosure, including in-substance
foreclosures 609 1,005
Transfer of third-party senior participating
interest in a real estate loan to a mortgage
payable upon acquisition of a property
through foreclosure 1,495 -
Recognition of valuation allowance upon sale
of real estate owned 1,505 -
Recognition of allowance for previously
provided loan losses 12,842 3,715
Purchase money mortgages from sale of real
estate owned 5,279 666
<FN>
See Accompanying Notes to Consolidated Financial Statements.
<PAGE>
BRT REALTY TRUST AND SUBSIDIARIES
Notes to Consolidated Financial Statements
Note 1 - Basis of Preparation
The accompanying interim unaudited consolidated financial
statements as of June 30, 1994 and for the three and nine months
ended June 30, 1994 and 1993 reflect all normal recurring
adjustments which are, in the opinion of management, necessary
for a fair statement of the results for such interim periods. The
results of operations for the three and nine months ended June
30, 1994 are not necessarily indicative of the results for the
full year.
Certain items on the consolidated financial statements for the
preceding period have been reclassified to conform with the
current consolidated financial statements.
The consolidated financial statements include the accounts of BRT
Realty Trust, its wholly-owned subsidiaries, and its
majority-owned or controlled real estate entities. Material
intercompany items and transactions have been eliminated. Many
of the wholly-owned subsidiaries were organized to take title to
various properties acquired by BRT Realty Trust. BRT Realty
Trust and its subsidiaries are hereinafter referred to as the
"Trust".
These statements should be read in conjunction with the
consolidated financial statements and related notes which are
incorporated by reference in the Trust's Annual Report on Form
10-K for the year ended September 30, 1993.
Note 2 - Per Share Data
Primary earnings per share of beneficial interest is based upon
the weighted average number of common shares and the assumed
equivalent shares outstanding during each period, after giving
effect to dividends relating to the Trust's preferred stock. The
preferred stock, issued on September 14, 1993, is not considered
a common stock equivalent for the purposes of computing primary
earnings per share. The assumed exercise of outstanding share
options, using the treasury stock method, is not materially
dilutive for the primary earnings per share computation for the
three and nine months ended June 30, 1994, and is anti-dilutive
for the three and nine months ended June 30, 1993.
Fully diluted earnings per share of beneficial interest amounts
are based on an increased number of shares that would be
outstanding assuming the exercise of common share options during
each period, and additionally in 1994, the conversion of
preferred stock to shares of beneficial interest at the period
end market price. The fully diluted per share computation for
the three months ended June 30, 1994 is dilutive, when 68,485
shares of beneficial interest were assumed outstanding. As for
the nine months ended June 30, 1994 and the three and nine months
ended June 30, 1993, the fully diluted earnings per share of
beneficial interest amounts are anti-dilutive, and therefore such
amounts are not presented.
Note 3 - Real Estate Loans
If all loans classified as nonearning were earning interest at
their contractual rates for the three and nine month periods
ended June 30, 1994 and 1993, interest income would have
increased by approximately $147,000 and $477,000 in the
respective periods in 1994, and $602,000 and $1,416,000 in the
respective periods in 1993.
Note 4 - Real Estate Owned
During the quarter ended June 30, 1994, the Trust consummated
sales of real estate owned, resulting in an aggregate gain of
approximately $1,356,000. These transactions were as follows:
(i) Two apartment/retail buildings located in midtown Manhattan
- sold to One Liberty Properties, Inc. ("One Liberty"), a
related party, for a consideration of $5,525,000. This
property was encumbered by a non-recourse mortgage of
approximately $2,637,000. The transaction and sales price
were approved by the Board of Trustees of the Trust,
including the independent trustees, subject to receipt of an
independent appraisal. After receipt of the independent
appraisal substantiating the purchase price of $5,525,000,
the transaction was completed, resulting in a gain to the
Trust of approximately $625,000. Simultaneous with the
consummation of the transaction, the mortgage of
approximately $2,637,000 was satisfied.
The property was sold subject to a long-term net lease with
a current annual rent of $550,000, which annual rent
increases by $50,000 every five years (the next increase
will be in 1999). For a period of ten years from closing,
the Trust will receive fifty percent of any premium which
One Liberty receives under the lease as a result of the
conversion of the leasehold position to cooperative
ownership.
One Liberty owns 203,767 shares of beneficial interest and
1,030,000 shares of preferred stock of the Trust, and has
approximately 14.7% of the total voting power of the Trust.
(ii) Retail building in Long Island City - sold for a net sales
price of approximately $1,125,000 (including a purchase
money mortgage of $860,000 taken back by the Trust). This
transaction resulted in a gain of approximately $375,000.
(iii)Retail building located in New York, New York - sold for a
net sales price of approximately $933,000, resulting in a
gain of approximately $184,000.
(iv) Two individual cooperative apartments located in New York,
New York - sold for approximately $120,000 resulting in a
gain of approximately $99,000. Subsequent to this
transaction, the Trust, still holds the unsold shares and
related proprietary lease applicable to one cooperative
apartment in said apartment building.
(v) Apartment/retail building located in New York, New York -
sold for a net sales price of approximately $516,000
(including a purchase money mortgage of $350,000 taken back
by the Trust). This transaction resulted in a gain of
approximately $72,000.
(vi) Apartment building located in New York, New York - sold for
a net sales price of approximately $752,000 (including a
purchase money mortgage of approximately $499,000 taken back
by the Trust), resulting in a loss of approximately $8,000.
(vii)Unsold shares and related proprietary leases in a
cooperative apartment building located in West New York, New
Jersey - sold in bulk for a net sales price of
approximately $170,000. This transaction resulted in a gain
of approximately $17,000.
<PAGE>
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Trust was engaged in the business of making and
participating in senior and junior real estate mortgage loans,
secured by income producing property and to a lesser extent by
unimproved real property. The Trust's investment policy
emphasized short-term mortgage loans. Repayments of real estate
loans in the amount of $42,430,000 are due during the twelve
months ending June 30, 1995, including $10,328,000 which are due
on demand. Over the past number of months, there has been some
pick up in real estate lending by institutional lenders and an
improvement in the market for real estate. Nevertheless, it is
still difficult to refinance existing mortgages and to sell
properties. Accordingly, the Trust cannot project the principal
amount of loans which will be paid down and/or paid off over the
next twelve months. In appropriate circumstances, the Trust will
extend a loan on a month to month or fixed term basis.
Effective September 23, 1992 the Trust entered into an
Amended and Restated Credit Agreement ("Restated Credit
Agreement") with five banks. The Restated Credit Agreement
extends the maturity date of the loan to June 30, 1995, with the
Trust having the right to extend for two additional one year
terms, if it satisfies certain conditions, principally making
certain mandatory payments and meeting certain ratios. The Trust
satisfied the June 30, 1994 mandatory prepayment requirement.
Assuming the Trust exercises its right to extend for two
additional one year terms, as of July 31, 1994, the Trust has
satisfied the June 30, 1995 mandatory prepayment requirement, and
38% of the mandatory prepayment due by June 30, 1996. The
Restated Credit Agreement precludes the Trust from engaging in
any lending activities except for taking back purchase money
mortgages in connection with the sale of real estate.
Under the Restated Credit Agreement, commencing July 1,
1994, the Trust is required to apply 75% of capital event
proceeds (proceeds from the sale of real property and mortgages
receivable and from pay downs or payoffs of real estate loans) to
reduce the principal balance due to the banks and the balance of
25% is deposited in a cash collateral account maintained with the
agent bank. The agent bank under the Restated Credit Agreement
is required to disburse funds to the Trust from the cash
collateral account upon requisition by the Trust, provided there
is no monetary default under the Restated Credit Agreement. To
the extent the cash collateral account exceeds $9,000,000 at the
end of any month or $10,000,000 within a month, such excess is to
be applied to reduce principal. To the extent the cash
collateral account is reduced below $9,000,000, the Trust can
utilize a portion of capital event proceeds and excess operating
cash flow to build the account up to $9,000,000. The Restated
Credit Agreement also requires a segregated interest reserve
account as part of the $9,000,000 cash collateral account,
amounting to three months interest payments ($1,635,000 at June
30, 1994). In addition, the Trust maintains its own operating
accounts, into which all operating revenues are deposited and
from which all operating expenses are paid and to the extent the
operating accounts exceed $500,000 at the end of any month, the
excess is deposited into the cash collateral account.
During the nine months ended June 30, 1994, the Trust had an
increase in cash provided by investing activities, as a result of
collections from real estate loans of $9,832,000 (net of
repayments to participating lenders of $5,470,000) and proceeds
from the sale of real estate owned of $8,769,000, net of purchase
money mortgages of $5,279,000. The cash provided by investing
activities was used in part to reduce the bank debt outstanding
to $79,283,000 at June 30, 1994, a reduction of $13,502,000 from
September 30, 1993. The Trust also paid off loans and mortgages
payable in the amount of $4,822,000, $4,237,000 of which was
satisfied in conjunction with two sales of real estate owned.
The Trust intends to satisfy its short term liquidity needs
from cash flow generated from interest on outstanding real estate
loans, net cash flow generated from the operation of properties
(all of which were acquired as a result of foreclosure, by deed
in lieu of foreclosure, or pursuant to a confirmed plan of
reorganization) and from the funds in the cash collateral
account. In the opinion of Management, the Restated Credit
Agreement, by its terms, and the mechanics of the cash collateral
<PAGE>
account, provide adequate funds for the Trust to operate its
business, to protect its receivables and to operate its real
estate (which includes making necessary capital improvements),
and sufficient time to dispose of assets and apply the net
proceeds therefrom to reduce the amounts outstanding under the
Restated Credit Agreement.
Results of Operations
The Trust's loan portfolio at June 30, 1994, before giving
effect to the allowance for possible losses was $90,549,000, of
which $7,056,000 (8% of total real estate loans) is categorized
as nonearning, as compared to $122,103,000 at September 30, 1993,
of which $26,750,000 (22% of total real estate loans) is
categorized as nonearning. The $31,554,000 decrease in the loan
portfolio is due to a combination of an increase in real estate
owned as a result of completion of foreclosure actions and
receipt of deeds in lieu of foreclosure, repayments of principal
on real estate loans (net of repayments to participating lenders)
and a settlement with the holder of a first mortgage for
$161,000, which represented the net book value on a real estate
loan on which the Trust had reserved approximately $10,000,000 in
the quarter ended September 30, 1990.
Real estate owned (prior to a valuation allowance of
$2,717,000) increased to $55,423,000 at June 30, 1994 from
$51,162,000 (prior to a valuation allowance of $3,229,000) at
September 30, 1993. The increase of $4,261,000 in real estate
owned is primarily a result of real estate acquired by
foreclosure or deed in lieu of foreclosure at the aggregate
estimated fair value of approximately $17,745,000, offset by the
sale of real estate owned, with an aggregate cost basis of
approximately $13,541,000 (prior to a valuation allowance of
$1,505,000).
Interest and fees on real estate loans decreased for the
nine and three month periods ended June 30, 1994 to $7,127,000
and $2,283,000 from $10,171,000 and $3,035,000 for the comparable
periods in the prior fiscal year. These decreases were a result
of a number of events which occurred during the nine and three
months ended June 30, 1993, including receipt of past due and
accumulated interest of $440,000 upon refinancing by a borrower,
a collection of approximately $586,000 from court appointed
receivers who operated properties securing certain loans, receipt
of an $800,000 fee ($400,000 of which was received during quarter
ended June 30, 1993) from a borrower as part of a workout and
additional interest of $325,000 received upon repayment of two
participating real estate loans secured by properties located in
Texas. Interest and fees on real estate loans was also reduced
in the 1994 periods as compared to the 1993 periods due to a
decrease in earning real estate loans, as a result of loan
payoffs and properties securing real estate loans becoming real
estate owned. These decreases were offset in part during the
current nine month period by the recognition of an unamortized
discount of $565,000 upon early payoff of a real estate loan, as
well as the collection of approximately $480,000 ($283,000 of
which was received during the three months ended June 30, 1994)
from court appointed receivers who operated properties securing
certain loans.
Operating income on real estate owned increased during
the nine months ended June 30, 1994 by $3,710,000 to $7,288,000
from $3,578,000 for the comparable period in Fiscal 1993. There
was also an increase during the quarter ended June 30, 1994 to
$2,273,000 from $1,683,000 for the prior comparable period, an
increase of $590,000. These increases were a result of an
increase in the number of properties acquired in foreclosure or
by deed in lieu of foreclosure.
Gain on sale of foreclosed properties held for sale for the
nine months ended June 30, 1994, was $1,507,000, $1,356,000 of
which occurred during the quarter ended June 30, 1994, as
compared to $161,000 for the nine months ended June 30, 1993,
$29,000 of which occurred during the third quarter of Fiscal
1993. It is the policy of the Trust to offer for sale all real
estate owned at prices which management believes represents fair
value in the geographic area in which the property is located.
The nine months ended June 30, 1993 include a gain on the
sale of marketable securities of $115,000. There was no
comparable gain during the nine months ended June 30, 1994.
Interest expense decreased for the nine and three month
periods ended June 30, 1994 to $5,059,000 and $1,712,000 from
$5,860,000 and $1,887,000 for the comparable periods in the prior
fiscal year. These decreases were the result of paydowns on
notes payable and subordinated note, offset in part by an
increase in the average prime rate.
The expenses for the nine months ended June 30, 1994 include a
provision for possible loan losses of $1,390,000, as compared to
$1,711,000 for the comparable period in the prior fiscal year.
During the quarter ended March 31, 1994, $952,000 of the
$1,390,000 provision was taken, consisting of, a provision of
$497,000, which was taken with respect to a real estate loan in
which the Trust has a junior leasehold mortgage. Recently, after
an arbitration, there was a significant increase in the ground
rent which will have an adverse effect on the borrowers cash flow
and therefore adversely effect the Trust's position. The
remaining $455,000 provision was taken on the total net equity
position in a wrap mortgage secured by a cooperative apartment
building. Due to cash flow problems experienced by the
cooperative corporation, the Trust, commencing in February 1994,
has been experiencing a delinquency of up to 90 days on the
monthly interest received. During the first quarter of Fiscal
1994 a $438,000 provision was taken as a result of the
termination of negotiations, in late January 1994, with the
holder of the first mortgage on a real estate loan in which the
Trust holds the junior position, for the Trust to purchase the
first mortgage at a discount. The nine months ended June 30,
1994, also include a provision for valuation adjustment of
$993,000, as compared to $3,138,000 for the comparable nine month
period in the prior year. The entire Fiscal 1994 valuation
allowance was taken during the quarter ended June 30, 1994,
$900,000 of which was taken with respect to unsold shares and
related proprietary leases in three cooperative apartment
buildings located in New York, New York. After an extensive
revaluation, specifically reviewing projected sales, renovation
costs, rental income and maintenance payments, as well as a
review of the sales of the cooperative apartments in these
buildings and in the New York City area, it was determined that
an additional valuation adjustment was required. The remaining
$93,000 was taken on undeveloped land located in New York, New
York, as a result of recent offers which have been received on
said property.
Advisor's fees decreased by $174,000 and $55,000 for the
nine and three months ended June 30, 1994, as compared to the
comparable nine and three months periods in Fiscal 1993. These
decreases are a result of a decrease in invested assets, the
basis on which the advisory fee is calculated, and a decrease in
the real estate loan portion with an increase in the real estate
owned portion. A 1% fee is paid on real estate loans, as
compared to a 1/2 of 1% fee on real estate owned.
General and administrative expenses decreased for the nine
months ended June 30, 1994 by $29,000 to $2,520,000 from
$2,549,000 for the nine months ended June 30, 1993. This
reduction is primarily due to a reduction of professional fees as
a result of the completion of many of the foreclosure actions and
bankruptcy proceedings. The decrease would have been greater as
the prior fiscal year included reimbursement of professional fees
of approximately $232,000 from a borrower with whom a workout was
in process and a settlement with a previous borrower. There was
an increase in general and administrative expenses during the
quarter ended June 30, 1994 to $889,000 from $753,000 for the
comparable quarter in the prior year. This increase was
primarily due to the reimbursement of professional fees of
approximately $90,000 during the quarter ended June 30, 1993 as a
result of a settlement with a previous borrower. In addition, in
the quarter ended June 30, 1994, the Trust repaid to a junior
creditor of one of the Trust's borrowers the sum of $95,000 in
settlement of claims asserted by a bankruptcy trustee for such
creditor, which claims related to payments made to the Trust by
such creditor to protect its security interest.
Operating expenses relating to real estate owned increased
for the nine and three month periods ended June 30, 1994 to
$3,787,000 and $1,218,000 from $2,062,000 and $768,000 for the
comparable periods in the prior fiscal year. These increases are
a direct result of an increase in the number of properties
acquired in foreclosure or by deed in lieu of foreclosure.
<PAGE>
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
On June 28, 1994, the Trust filed a Current Report on Form 8-K
with the Securities and Exchange Commission to report that on
June 14, 1994, a wholly-owned subsidiary of the Trust indirectly
sold for cash the fee interest of a property located in midtown
Manhattan to One Liberty Properties, Inc., a related party, for a
consideration of $5,525,000.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
BRT REALTY TRUST
Registrant
8/12/94 /s/ Israel Rosenzweig
Date Israel Rosenzweig,
President
8/12/94 /s/ David W. Kalish
Date David W. Kalish,
Vice President and
Chief Financial Officer
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