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American Realty Investors Inc. Reports Operating Results (10-Q)

August 14, 2012 | About:
10qk

10qk

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American Realty Investors Inc. (ARL) filed Quarterly Report for the period ended 2012-06-30.

American Realty Investors, Inc. has a market cap of $23.4 million; its shares were traded at around $2.05 with and P/S ratio of 0.2.

Highlight of Business Operations:

Rental and other property revenues were $31.0 million for the three months ended June 30, 2012. This represents an increase of $1.7 million, as compared to the prior period revenues of $29.3 million. This change, by segment, is an increase in the apartment portfolio of $3.2 million, offset by decrease in the commercial portfolio of $1.4 million and decrease in the land and other portfolios of $0.1 million. Within the apartment portfolio, there was an increase of $2.2 million due to the developed properties in the lease-up phase and an increase of $1.0 million in the same property portfolio. Our apartment portfolio continues to thrive in the current economic conditions with occupancies averaging over 95%. Within the commercial portfolio, the same property portfolio decreased by $1.4 million. We continue to market our properties aggressively to attract new tenants and strive for continuous improvement of our properties in order to maintain our existing tenants.

Mortgage and loan interest expense was $16.6 million for the three months ended June 30, 2012. This represents an increase of $1.2 million, as compared to the prior period interest expense of $15.4 million. This change, by segment, is an increase in our apartment portfolio of $4.3 million, offset by a decrease in our commercial portfolio of $1.4 million, and a decrease in our land and other portfolios of $1.7 million. Within the apartment portfolio, the same properties increased $3.2 million due to the write-off of the previous loan s deferred financing charges and prepayment penalties that were paid as part of the closing costs associated with the refinancing of seven apartment loans in the current period. The developed properties increased $1.1 million due to properties in the lease-up phase. Once construction is completed, interest expense is no longer capitalized. Within the commercial portfolio, the same properties decreased by $1.4 million. This decrease is related to a commercial loan that was in default in 2011 and was accruing interest at the default interest rate. The loan is no longer in default and is no longer being charged a default rate of interest in the current period. The decrease in the land and other portfolios was due to land sales.

Gain on land sales decreased for the three months ended June 30, 2012, as compared to the prior period. In the current period, we sold 84.75 acres of land in five separate transactions for an aggregate sales price of $12.7 million and recorded a gain of $4.7 million. In the prior period, we sold 1,067 acres of land in 19 separate transactions for an aggregate sales price of $60.4 million and recorded a gain of $14.0 million.

Rental and other property revenues were $60.6 million for the six months ended June 30, 2012. This represents an increase of $4.1 million, as compared to the prior period revenues of $56.5 million. This change, by segment, is an increase in the apartment portfolio of $6.0 million, offset by a decrease in the commercial portfolio of $1.4 million and decrease in the land and other portfolios of $0.5 million. Within the apartment portfolio, there was an increase of $4.5 million due to the developed properties in the lease-up phase and an increase of $1.5 million in the same property portfolio. Our apartment portfolio continues to thrive in the current economic conditions with occupancies averaging over 95%. Within the commercial portfolio, the same property portfolio decreased by $1.4 million. We continue to market our properties aggressively to attract new tenants and strive for continuous improvement of our properties in order to maintain our existing tenants.

Mortgage and loan interest expense was $34.2 million for the six months ended June 30, 2012. This represents an increase of $4.3 million, as compared to the prior period interest expense of $29.9 million. This change, by segment, is an increase in our apartment portfolio of $8.5 million, offset by a decrease in our commercial portfolio of $0.9 million, and a decrease in our land and other portfolio of $3.3 million. Within the apartment portfolio, the same properties increased $6.2 million due to the write off of the previous loan s deferred financing charges and prepayment penalties that were paid as part of the closing costs associated with the refinancing of 11 apartment loans in the current period. The developed properties increased $2.3 million due to properties in the lease-up phase. Once construction is completed, interest expense is no longer capitalized. Within the commercial portfolio, the same properties decreased by $1.4 million. This decrease is related to a commercial loan that was in default in 2011 and was accruing interest at the default interest rate. The loan is no longer in default and is no longer being charged a default rate of interest in the current period. The decrease in the land and other portfolios was due to land sales.

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