GREENWICH, Conn.--(BUSINESS WIRE)--Sep 7, 2018--Urstadt Biddle Properties Inc. (NYSE:UBA and UBP), a real estate investment trust, today reported its operating results for the three and nine month periods ended July 31, 2018.

Net income applicable to Class A Common and Common stockholders for the third quarter of fiscal 2018 was $5,579,000 or $0.15 per diluted Class A Common share and $0.13 per diluted Common share, compared to $6,061,000 or $0.16 per diluted Class A Common share and $0.14 per diluted Common share in last year’s third quarter. Net income attributable to Class A Common and Common stockholders for the first nine months of fiscal 2018 was $20,098,000 or $0.53 per diluted Class A Common share and $0.47 per diluted Common share, compared to $33,574,000 or $0.90 per diluted Class A Common share and $0.79 per diluted Common share in the first nine months of fiscal 2017. Net income for the three and nine month periods ended July 31, 2017 includes a loss on sale of properties of $688,000 and net income for the nine month period ended July 31, 2017 includes a net gain on sale of properties in the amount of $18.8 million.

Funds from operations (“FFO”) for the third quarter of fiscal 2018 was $13,410,000 or $0.35 per diluted Class A Common share and $0.32 per diluted Common share, compared with $13,815,000 or $0.37 per diluted Class A Common share and $0.33 per diluted Common share in last year’s third quarter. For the first nine months of fiscal 2018, FFO amounted to $42,610,000 or $1.13 per diluted Class A Common share and $1.01 per diluted Common share, compared to $35,384,000 or $0.94 per diluted Class A Common share and $0.84 per diluted Common share in the corresponding period of fiscal 2017.

Both FFO and net income for the nine month period ended July 31, 2018 include $3.7 million in lease termination income the company received from the grocery store tenant in the company’s Newark, NJ property when that tenant vacated the property prior to the end of its lease. Both FFO and net income for the three and nine month periods ended July 31, 2017 include lease termination income of $2.1 million relating to the termination of the only lease at the company’s Stratfield Road property located in Fairfield, CT, which was sold in the third quarter of fiscal 2017.

At July 31, 2018, the company’s consolidated properties were 91.9% leased (versus 92.7% at the end of fiscal 2017) and 90.2% occupied (versus 91.0% at the end of fiscal 2017).

Both the percentage of property leased and the percentage of property occupied referenced in the preceding paragraph exclude the company’s unconsolidated joint ventures. At July 31, 2018, the company had equity interests in seven unconsolidated joint ventures (751,000 square feet), which were 96.8% leased (versus 97.7% at the end of fiscal 2017).

Commenting on the quarter’s operating results, Willing L. Biddle, President and CEO of Urstadt Biddle Properties Inc., said “We had another strong operating quarter with FFO of $13.4 million or $0.35 per Class A Common share which provides strong coverage of our current dividend level, reflecting a 77% FFO payout ratio on a per Class A Common share basis. We are very pleased our FFO payout ratio continues to improve as we know our investors greatly value the safety and consistent growth of our dividend through all types of economic cycles. The strong operating results are a result of a number of positive transactions completed in fiscal 2017 as well as positive events thus far in fiscal 2018. We completed the sale of our vacant Westchester Pavilion property in March of fiscal 2017 for $57 million and re-invested those proceeds in several new properties and other investments, and we are continuing to see earnings improvement in our operating results as that capital is now fully deployed. In addition, we were able to complete two accretive financing transactions in fiscal 2017, which increased our operating results this quarter and will continue to have a positive impact going forward. In July 2017, the company refinanced its largest mortgage, reducing the interest rate from 5.52% to 3.398%, which is now saving the company over $1 million in interest expense per annum. Also, in October 2017, we redeemed all $129 million of our 7.125% Series F Cumulative Preferred Stock using proceeds from the sale of the Pavilion and the issuance of $115 million of 6.25% Series H Cumulative Preferred Stock. This reduction in preferred stock outstanding, along with the lower coupon, is now saving the company over $2 million per annum in preferred stock dividends.”

Mr. Biddle continued………“In June 2018, we purchased a 75.3% equity interest in a newly formed DownREIT joint venture, UB New City I, LLC, in which the company is the managing member. Our initial investment was $2.4 million. New City owns a single tenant retail real estate property leased to Putnam County Savings Bank. In addition, New City rents certain parking spaces on the property to the owner of the adjacent grocery anchored shopping center. The property is located in New City, NY. The property was contributed to the new entity by the former owners who received units of ownership in New City equal to the value of this contributed property. This investment provides a strong yield on our invested capital and we believe it improves our chances of acquiring the adjacent grocery anchored shopping center in the future. Our portfolio’s leased rate for properties we consolidate has fallen 0.8% since the end of fiscal 2017 to 91.9%, primary due to the vacancy in this third quarter of our 31,000 square foot grocery store tenant in our Passaic, NJ property. This vacancy represents 0.7% of our consolidated portfolio square footage, and we are currently working with several prospective new tenants for this space. As reported last quarter, we signed a new 40,000 square foot lease with Whole Foods Market to anchor our Wayne, NJ property. Although we have a signed lease, at quarter end we still have not accounted for this space as leased due to some approval contingencies, which include obtaining municipal site plan approval. We expect to receive this approval in the next month. Once we receive site plan approval, we will include this lease in our leasing metrics and the percentage of our consolidated properties leased will increase 0.9%. In addition, the Seabra Supermarket Group is currently making good progress renovating the 62,000 square foot anchor supermarket space they leased in our Ferry Plaza property in the Ironbound section of Newark, and hopes to open in early 2019. We also have five other spaces over 10,000 square feet that are vacant in our consolidated portfolio, which represent 36% of our current vacant square footage, however we do have several prospects for some of this vacant space and hope to have new leasing to announce on these spaces in the months to come.”

Urstadt Biddle Properties Inc. is a self-administered equity real estate investment trust which owns or has equity interests in 84 properties containing approximately 5.1 million square feet of space. Listed on the New York Stock Exchange since 1970, it provides investors with a means of participating in ownership of income-producing properties. It has paid 194 consecutive quarters of uninterrupted dividends to its shareholders since its inception and has raised total dividends to its shareholders for the last 24 consecutive years.

Certain statements contained herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among other things, risks associated with the timing of and costs associated with property improvements, financing commitments and general competitive factors.

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Results of Operations

The following information summarizes the company's results of operations for the nine month and three month periods ended July 31, 2018 and 2017 (amounts in thousands):

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