0000067625 2016-10-01 2017-06-30 0000067625 2017-08-01 0000067625 2016-09-30 0000067625 us-gaap:SeriesBPreferredStockMember 2017-06-30 0000067625 us-gaap:SeriesBPreferredStockMember 2016-09-30 0000067625 2017-06-30 0000067625 MNR:OFallonMember 2017-06-30 0000067625 MNR:RoanokeMember 2017-06-30 0000067625 MNR:RidgelandMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:PreferredStockMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member us-gaap:MortgageBackedSecuritiesMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member us-gaap:CommonStockMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member us-gaap:PreferredStockMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:MortgageBackedSecuritiesMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:CommonStockMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:PreferredStockMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member us-gaap:MortgageBackedSecuritiesMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member us-gaap:CommonStockMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member us-gaap:PreferredStockMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:MortgageBackedSecuritiesMember 2016-09-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:CommonStockMember 2016-09-30 0000067625 2016-06-30 0000067625 us-gaap:SeriesCPreferredStockMember 2017-06-30 0000067625 us-gaap:SeriesCPreferredStockMember 2016-09-30 0000067625 us-gaap:StockOptionMember 2016-10-01 2017-06-30 0000067625 us-gaap:StockOptionMember 2017-06-30 0000067625 2015-10-01 2016-06-30 0000067625 2016-04-01 2016-06-30 0000067625 2015-09-30 0000067625 us-gaap:CommonStockMember MNR:TwoThousandAndSevenPlanMember us-gaap:MaximumMember 2017-06-30 0000067625 us-gaap:RestrictedStockUnitsRSUMember MNR:TwoThousandAndSevenPlanMember us-gaap:MaximumMember 2017-06-30 0000067625 MNR:TwoThousandAndSevenPlanMember 2015-10-01 2016-06-30 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2016-10-17 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2016-10-16 2016-10-17 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2016-12-30 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2016-12-29 2016-12-30 0000067625 MNR:FedexGroundPackageSystemInc.Member 2016-10-02 0000067625 MNR:FedexGroundPackageSystemInc.Member 2016-10-01 2016-10-02 0000067625 us-gaap:IndustrialPropertyMember MNR:WhiteBearLakeMNMember 2016-10-27 0000067625 us-gaap:IndustrialPropertyMember MNR:WhiteBearLakeMNMember 2016-10-26 2016-10-27 0000067625 MNR:FedexAndFedexSubsidiariesMember 2016-10-01 2017-06-30 0000067625 MNR:FedexCorporationMember 2016-10-01 2017-06-30 0000067625 MNR:FedexCorporationSubsidiariesMember 2016-10-01 2017-06-30 0000067625 MNR:FedexAndFedexSubsidiariesMember 2015-10-01 2016-06-30 0000067625 MNR:FedexCorporationMember 2015-10-01 2016-06-30 0000067625 MNR:FedexCorporationSubsidiariesMember 2015-10-01 2016-06-30 0000067625 MNR:FedexAndFedexSubsidiariesMember MNR:RentalAndReimbursementRevenueMember MNR:FiscalTwoThousandSeventeenMember 2016-10-01 2017-06-30 0000067625 MNR:FedexCorporationMember MNR:RentalAndReimbursementRevenueMember MNR:FiscalTwoThousandSeventeenMember 2016-10-01 2017-06-30 0000067625 MNR:FedexCorporationSubsidiariesMember MNR:RentalAndReimbursementRevenueMember MNR:FiscalTwoThousandSeventeenMember 2016-10-01 2017-06-30 0000067625 MNR:FedexAndFedexSubsidiariesMember MNR:RentalAndReimbursementRevenueMember 2016-10-01 2017-06-30 0000067625 MNR:WhiteBearLakeMNMember 2016-10-01 2017-06-30 0000067625 MNR:WhiteBearLakeMNMember 2015-10-01 2016-06-30 0000067625 MNR:UMHPropertiesIncMember us-gaap:CommonStockMember 2017-06-30 0000067625 MNR:UMHPropertiesIncMember MNR:SeriesACumulativeRedeemablePreferredStockMember 2017-06-30 0000067625 MNR:UMHPropertiesIncMember MNR:SeriesACumulativeRedeemablePreferredStockMember 2016-10-01 2017-06-30 0000067625 MNR:UMHPropertiesIncMember MNR:SeriesBCumulativeRedeemablePreferredStockMember 2017-06-30 0000067625 us-gaap:MaximumMember 2016-10-01 2017-06-30 0000067625 us-gaap:MinimumMember 2016-10-01 2017-06-30 0000067625 MNR:SevenMortgagesLoansMember 2016-10-01 2017-06-30 0000067625 MNR:FifteenMortgagesLoansMember 2016-10-01 2017-06-30 0000067625 MNR:TermLoansMember 2016-10-01 2017-06-30 0000067625 MNR:TermLoanOneMember 2016-10-01 2017-06-30 0000067625 MNR:TermLoanTwoMember 2016-10-01 2017-06-30 0000067625 us-gaap:LineOfCreditMember 2016-10-01 2017-06-30 0000067625 MNR:DividendReinvestmentAndStockPurchasePlanMember 2016-10-01 2017-06-30 0000067625 us-gaap:CommonStockMember 2017-06-30 0000067625 us-gaap:CommonStockMember 2016-10-01 2017-06-30 0000067625 us-gaap:MaximumMember 2017-01-17 0000067625 MNR:SeriesACumulativeRedeemablePreferredStockMember 2016-09-14 0000067625 MNR:SeriesACumulativeRedeemablePreferredStockMember 2016-10-14 0000067625 MNR:SeriesACumulativeRedeemablePreferredStockMember 2016-10-13 2016-10-14 0000067625 MNR:SeriesCCumulativeRedeemablePreferredStockMember 2017-06-30 0000067625 MNR:SeriesCCumulativeRedeemablePreferredStockMember 2016-10-01 2017-06-30 0000067625 MNR:MortgageNotesPayableFairValueMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:PreferredStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member us-gaap:PreferredStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:PreferredStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member us-gaap:PreferredStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:CommonStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member us-gaap:CommonStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:CommonStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member us-gaap:CommonStockMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:MortgageBackedSecuritiesMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member us-gaap:MortgageBackedSecuritiesMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:MortgageBackedSecuritiesMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member us-gaap:MortgageBackedSecuritiesMember 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel1Member 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member 2017-06-30 0000067625 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel3Member 2017-06-30 0000067625 MNR:PropertyPurchaseAgreementMember us-gaap:IndustrialPropertyMember 2017-06-30 0000067625 MNR:PropertyPurchaseAgreementMember us-gaap:IndustrialPropertyMember us-gaap:MinimumMember 2016-10-01 2017-06-30 0000067625 MNR:PropertyPurchaseAgreementMember us-gaap:IndustrialPropertyMember us-gaap:MaximumMember 2016-10-01 2017-06-30 0000067625 MNR:PropertyPurchaseAgreementMember us-gaap:IndustrialPropertyMember 2016-10-01 2017-06-30 0000067625 MNR:PropertyPurchaseAgreementMember us-gaap:IndustrialPropertyMember MNR:InvestmentGradeTenantsOrSubsidiariesMember 2017-06-30 0000067625 MNR:PropertyPurchaseAgreementMember us-gaap:IndustrialPropertyMember MNR:FdxAndSubsidiariesMember 2017-06-30 0000067625 us-gaap:IndustrialPropertyMember 2017-06-30 0000067625 us-gaap:IndustrialPropertyMember 2016-10-01 2017-06-30 0000067625 us-gaap:SubsequentEventMember MNR:CommonShareholdersMember 2017-07-03 0000067625 us-gaap:SubsequentEventMember MNR:CommonShareholdersMember 2017-07-02 2017-07-03 0000067625 us-gaap:SubsequentEventMember MNR:SeriesCPreferredStockholdersMember 2017-07-03 0000067625 us-gaap:SubsequentEventMember MNR:SeriesCPreferredStockholdersMember 2017-07-02 2017-07-03 0000067625 MNR:TwoThousandAndSevenPlanMember us-gaap:MaximumMember 2016-10-01 2017-06-30 0000067625 MNR:UMHPropertiesIncMember MNR:SeriesBCumulativeRedeemablePreferredStockMember 2016-10-01 2017-06-30 0000067625 MNR:UMHPropertiesIncMember MNR:CommonAndPreferredStockMember 2017-06-30 0000067625 2015-10-01 2016-09-30 0000067625 us-gaap:LineOfCreditMember 2017-06-30 0000067625 us-gaap:CommonStockMember 2016-10-01 2017-06-30 0000067625 MNR:TwoThousandAndSevenPlanMember us-gaap:RestrictedStockMember 2015-10-01 2016-06-30 0000067625 MNR:TwoThousandAndSevenPlanMember us-gaap:RestrictedStockMember 2016-10-01 2017-06-30 0000067625 us-gaap:CommonStockMember 2015-10-01 2015-10-02 0000067625 us-gaap:CommonStockMember us-gaap:MaximumMember 2015-10-01 2015-10-02 0000067625 us-gaap:CommonStockMember us-gaap:MinimumMember 2015-10-01 2015-10-02 0000067625 us-gaap:AccountingStandardsUpdate201503Member 2015-10-01 2016-06-30 0000067625 us-gaap:AccountingStandardsUpdate201503Member 2016-09-30 0000067625 MNR:FedexAndFedexSubsidiariesMember MNR:RentalAndReimbursementRevenueMember MNR:FiscalTwoThousandSeventeenMember 2015-10-01 2016-06-30 0000067625 MNR:FedexCorporationMember MNR:RentalAndReimbursementRevenueMember MNR:FiscalTwoThousandSeventeenMember 2015-10-01 2016-06-30 0000067625 MNR:FedexCorporationSubsidiariesMember MNR:RentalAndReimbursementRevenueMember MNR:FiscalTwoThousandSeventeenMember 2015-10-01 2016-06-30 0000067625 MNR:MilwaukeeElectricToolMember 2017-06-30 0000067625 2017-04-01 2017-06-30 0000067625 MNR:RockfordILMember 2017-06-30 0000067625 us-gaap:CommonStockMember MNR:AmendedAndRestatedIncentiveAwardPlanMember 2017-06-30 0000067625 us-gaap:AccountingStandardsUpdate201503Member 2016-04-01 2016-06-30 0000067625 MNR:StockOptionOneMember 2016-10-01 2017-06-30 0000067625 MNR:StockOptionOneMember 2017-06-30 0000067625 MNR:StockOptionTwoMember 2016-10-01 2017-06-30 0000067625 MNR:StockOptionTwoMember 2017-06-30 0000067625 MNR:WhiteBearLakeMNMember 2017-04-01 2017-06-30 0000067625 MNR:WhiteBearLakeMNMember 2016-04-01 2016-06-30 0000067625 us-gaap:PreferredStockMember 2017-06-30 0000067625 us-gaap:PreferredStockMember 2016-10-01 2017-06-30 0000067625 MNR:SecuritiesOneMember 2016-10-01 2017-06-30 0000067625 MNR:SecuritiesOneMember 2017-06-30 0000067625 MNR:SecuritiesTwoMember 2016-10-01 2017-06-30 0000067625 MNR:SecuritiesTwoMember 2017-06-30 0000067625 MNR:SeriesCCumulativeRedeemablePreferredStockMember 2017-03-08 2017-03-09 0000067625 MNR:SeriesCCumulativeRedeemablePreferredStockMember 2017-03-09 0000067625 us-gaap:SubsequentEventMember us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemIncMember 2017-08-03 0000067625 MNR:MilwaukeeElectricToolMember 2017-04-01 2017-06-30 0000067625 us-gaap:SubsequentEventMember us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemIncMember 2017-08-02 2017-08-03 0000067625 MNR:TwoThousandAndSevenPlanMember us-gaap:MaximumMember 2017-06-30 0000067625 us-gaap:SeriesBPreferredStockMember 2016-10-01 2017-06-30 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-04-05 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-04-04 2017-04-05 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-23 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-22 2017-06-23 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-27 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-26 2017-06-27 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-26 2017-06-28 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-28 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-29 0000067625 us-gaap:IndustrialPropertyMember MNR:FedexGroundPackageSystemInc.Member 2017-06-26 2017-06-29 0000067625 us-gaap:SeriesAPreferredStockMember 2017-06-30 0000067625 us-gaap:LandMember 2017-04-01 2017-06-30 0000067625 us-gaap:BuildingMember 2017-04-01 2017-06-30 0000067625 MNR:InPlaceLeasesMember 2017-04-01 2017-06-30 0000067625 MNR:FedexGroundPackageSystemInc.Member 2017-04-01 2017-06-30 0000067625 MNR:FedexGroundPackageSystemInc.Member 2016-10-01 2017-06-30 0000067625 MNR:SixMortgagesLoansMember 2016-10-01 2017-06-30 0000067625 MNR:OneMortgagesLoansMember 2016-10-01 2017-06-30 0000067625 MNR:SeriesBCumulativeRedeemablePreferredStockMember 2017-05-05 0000067625 MNR:SeriesBCumulativeRedeemablePreferredStockMember 2017-06-07 0000067625 MNR:SeriesBCumulativeRedeemablePreferredStockMember 2017-06-06 2017-06-07 0000067625 MNR:SeriesCCumulativeRedeemablePreferredStockMember 2017-06-29 0000067625 MNR:SeriesCCumulativeRedeemablePreferredStockMember 2017-06-26 2017-06-29 0000067625 MNR:ATMPreferredStockProgramMember 2017-06-26 2017-06-29 0000067625 MNR:ATMPreferredStockProgramMember 2017-06-29 0000067625 MNR:FedexGroundPackageSystemInc.Member MNR:TwoPropertiesMember 2016-10-01 2017-06-30 0000067625 MNR:FedexGroundPackageSystemInc.Member MNR:TwoPropertiesMember 2017-06-30 0000067625 us-gaap:SubsequentEventMember MNR:ATMPreferredStockProgramMember 2017-07-24 2017-07-25 0000067625 us-gaap:SubsequentEventMember MNR:ATMPreferredStockProgramMember 2017-07-25 0000067625 us-gaap:SubsequentEventMember MNR:LeaseAgreementMember MNR:FBMGypsumSupplyOfIllinoisLLCMember 2017-07-01 2017-07-31 0000067625 us-gaap:SubsequentEventMember MNR:LeaseAgreementMember MNR:FBMGypsumSupplyOfIllinoisLLCMember 2017-07-31 0000067625 us-gaap:SeriesBPreferredStockMember 2016-06-30 0000067625 us-gaap:SeriesAPreferredStockMember 2016-06-30 iso4217:USD xbrli:shares xbrli:pure iso4217:USD xbrli:shares MNR:Properties utr:sqft MNR:Employee utr:acre MNR:RealEstateProperties MNR:securities MONMOUTH REAL ESTATE INVESTMENT CORP 10-Q 2017-06-30 false --09-30 246678 525660 0 2300000 12400000 5400000 194600000 192039750 68920972 73824161 68920972 73824161 MNR 73604894 100495810 13769073 0 0 0 0 0 0 0 0 73604894 5550 59830271 13769073 5550 59830271 19011526 5200000 2750000 14688025 14688025 0 0 85803256 85803256 0 0 4529 4529 0 0 100495810 0 0 80790684 122094940 1171313495 1373574748 0.07875 0.07875 0.06125 0.06125 0.07625 0.07625 0.06125 0.06125 0.07625 0.07875 0.07875 0.06125 200000000 200000000 59111167 45132315 66340821 53992290 7074383 34311041 3471566 57575469 148830169 169226861 1005938180 1188576632 165375315 184998116 1022483326 1204347887 4830987 7358734 6917431 7739322 1444824 1148114 1245923 969603 4165268 4137743 5816153 8608879 7227571 5061923 1223485885 1351618012 9868572 13936503 3998771 2853438 477476010 554486956 561736464 625627787 693371837 0 57500000 210000000 135000000 689210 738242 0 0 391726621 438742799 12942267 8765134 8430384 0 0 597858098 658246175 1223485885 1351618012 3238516 3727227 12332599 13103744 0.01 0.01 0.01 0.01 0.01 0.01 0 2300000 8400000 5400000 2139750 8400000 5400000 2300000 0 2300000 8400000 5400000 2139750 8400000 5400000 2300000 0.01 0.01 0.01 0.01 0.01 0.01 1412050 Q3 95749508 11749997 6886958 12073909 83098898 69340199 24113999 28609096 11806975 9874498 3324085 4208859 71291923 59465701 20789914 24400237 1327376 1418375 445404 451823 21449830 17478374 6096880 7318258 178526 545955 135358 0 5307853 5099841 1542432 1786852 3635986 3316489 981766 1053253 9279165 7681519 2633706 3520322 41178736 35540553 11835546 14130508 -11911267 -11497749 -4047158 -2748225 2293944 1159409 272067 1487836 4630653 4050455 1486134 1899320 30008895 22301897 8231295 11730363 11325583 6455274 2151758 4045787 16216147 15846623 6079537 5217411 0.23 0.25 0.09 0.07 0.42 0.35 0.12 0.16 0.42 0.34 0.12 0.16 0.23 0.24 0.09 0.07 71422664 64703203 66462209 73053693 71264806 64613953 66337101 72881974 -1883189 18489989 10100681 -2117319 2293944 1159409 272067 1487836 25831762 39632477 18059909 8125208 12039014 33177203 15908151 1612256 50191019 43346646 656824 7676175 71446 -2293188 2527747 1859791 -12479 1235976 2293944 1159409 441054 306688 99760 174709 23726676 19610250 -232827215 -169804819 39467317 17772994 10693212 8165701 1280000 1100000 2700000 1650000 1208390 19517185 208390539 141230341 0 1412050 1650516 1204207 59936689 26609348 137925000 92971000 137925000 98636685 121271222 27081387 24788097 11044489 6455274 -83999511 -5186951 53493750 0 2467000 -0.16 -0.10 -0.03 -0.06 -0.16 -0.10 -0.03 -0.06 -95336 0 4125819 0 99 105 16010000 17917000 102135 83000 26340 38333 65000 65000 0 65000 0.51 0.08 0.43 0.46 0.06 0.40 2031-03-31 2026-09-30 2028-07-31 2032-05-31 2032-01-31 2032-03-31 2032-04-30 2032-03-31 2024-08-31 2027-12-31 78455200 78995500 26973500 26224800 15261700 16596200 7865900 5160600 8399268 38300000 0.0444 0.0617 0.1884 0.2020 0.0226 0.0209 P8Y P8Y 0 0 7.84 112719 1.509375 0.16 0.3828125 0.16 0.3828125 2017-08-15 2017-08-15 2017-08-15 2017-08-15 25.00 25.00 25.00 1.53125 10000000 7229654 6326691 7229654 2017-07-03 2017-07-03 2017-07-03 2017-07-03 2017-09-15 2017-09-15 2017-09-15 2017-09-15 571364000 17975000 15994000 338584 213672 1039000 354482 343483 351874 315560 237756 110361 4 2 4 3 0.0417 0.0445 0.0428 <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The fair value of these financial assets was determined using the following inputs at June 30, 2017 and September 30, 2016:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr> <td style="vertical-align: bottom; padding-bottom: 1.5pt; text-align: justify">&#160;</td> <td style="vertical-align: bottom; padding-bottom: 1.5pt">&#160;</td> <td colspan="14" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fair Value Measurements at Reporting Date Using</b></font></td> <td style="vertical-align: bottom; padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: center">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Total</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Quoted Prices<br /> in Active<br /> Markets for<br /> Identical<br /> Assets</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>(Level 1)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Significant Other Observable Inputs</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>(Level 2)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Significant Unobservable Inputs</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>(Level 3)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt"><b><u>As of June 30, 2017:</u></b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 44%"><font style="font-size: 10pt">Equity Securities &#8211; Preferred Stock</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 11%; text-align: right"><font style="font-size: 10pt">14,688,025</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 12%; text-align: right"><font style="font-size: 10pt">14,688,025</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 9%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 12%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Equity Securities &#8211; Common Stock</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">85,803,256</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">85,803,256</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Mortgage Backed Securities</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">4,529</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">4,529</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total Securities Available for Sale at Fair Value</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">100,495,810</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">100,495,810</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt"><b><u>As of September 30, 2016:</u></b></font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Equity Securities &#8211; Preferred Stock</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">13,769,073</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">13,769,073</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Equity Securities &#8211; Common Stock</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">59,830,271</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">59,830,271</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Mortgage Backed Securities</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">5,550</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">5,550</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total Securities Available for Sale at Fair Value</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">73,604,894</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">73,604,894</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="margin: 0pt"></p> 35100000 21001538 40598446 32120000 50621072 21933000 38347933 9000000 1764878 100000 P15Y P10Y P10Y P15Y P15Y P15Y P15Y P15Y P7Y P10Y2M12D 88676000 1.00 1.00 0.40 0.12 1.00 1.00 1.00 1.00 1.00 1.00 Large Accelerated Filer P15Y 498540 75469 2017 0.23299 0.0328125 18835864 16707613 5805359 6135381 180000 P15Y P15Y P15Y P15Y P15Y P15Y P15Y P12Y P15Y P12Y 23500000 14500000 26184000 20875000 32900000 15350000 24800000 6000000 0.0403 0.0397 0.0380 0.0386 0.0360 0.0420 0.0360 0.04125 2309000 1365000 2537000 2102000 3194000 1700000 2282000 721000 250000 201538 499000 9124000 6944000 Only tenants that leased 5% or more of the Company’s total square footage No other tenant accounted for 5% or more of the Company’s total rental space No other tenant accounted for 5% or more of the Company's total Rental and Reimbursement Revenue. 0.60 0.07 0.53 0.56 0.07 0.49 100495810 0.066 0.21 0.23 0.11 0.07 0.10 125719 1725457 1115046 13.72 11031142 5000000 2500000 200000 100000 0.0825 0.0800 949470 713501 240463 283573 0.0760 0.0345 0.0490 0.0450 P11Y6M P9Y9M18D P14Y10M25D P10Y6M 0.0448 0.0421 35266000 9424697 10171381 -3152554 -2921873 6272143 7249508 4903189 53493750 57500000 25.23299 25.0328125 1500000 50625 4762000 Prior lease expiration date from September 2021 through September 2026. 5.27 598000 1097000 6.68 59425 4.78 4126000 -3139950 -3087363 -52587 prime plus 0.75% 300000000 100000000 2020-09-30 483748153 561736464 420300 121800 -26707 -194194 0 -84198 0 0 0 0 -8006 -73055 0 -24017 -9846 -52363 0 -32022 -8855 -68776 0 -28159 0.0421 0.0461 0.0384 0.0448 1.49 0.74 0.16 0.15 0.64 0 0 1.0973965 4768266 2284633 2483633 -122043 -194194 0 -84198 0 0 0 0 0.996 0.998 862000 71003093 0 1709000 713501 240463 2017-01-04 2016-12-09 2016-01-05 1 10 1 65000 215000 65000 15.04 14.24 10.37 2025-01-04 2024-12-09 2024-01-05 157858 89250 125108 171719 P8Y4M24D 30947600 28819800 2127800 0 0 0 0 0 0 4 3 1 30947600 11895800 19051800 -3139950 -567137 -2572913 25.00 25.00 73500000 <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 1 &#8211; ORGANIZATION AND ACCOUNTING POLICIES</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Monmouth Real Estate Investment Corporation, a Maryland corporation, together with its consolidated subsidiaries (MREIC, the Company, or we), operates as a real estate investment trust (REIT) deriving its income primarily from real estate rental operations. As of June 30, 2017, the Company owned 105 properties with total square footage of approximately 17,917,000, which was 99.8% occupied, as compared to 99 properties with total square footage of approximately 16,010,000, which was 99.6% occupied as of September 30, 2016. These properties are located in 30 states: Alabama, Arizona, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Jersey, New York, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Washington and Wisconsin. The Company also owns a portfolio of REIT investment securities, which the Company generally limits to no more than approximately 10% of its undepreciated assets (which is the Company&#8217;s total assets excluding accumulated depreciation).</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company has elected to be taxed as a REIT under Sections 856-860 of the Internal Revenue Code of 1986, as amended (the Code), and intends to maintain its qualification as a REIT in the future. As a qualified REIT, with limited exceptions, the Company will not be taxed under Federal and certain state income tax laws at the corporate level on taxable income that it distributes to its shareholders. For special tax provisions applicable to REITs, refer to Sections 856-860 of the Code. The Company is subject to franchise taxes in several of the states in which the Company owns property.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The interim Consolidated Financial Statements furnished herein have been prepared in accordance with Accounting Principles Generally Accepted in the United States of America (U.S. GAAP) applicable to interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending September 30, 2017. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in the Company&#8217;s annual report on Form 10-K for the fiscal year ended September 30, 2016.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Use of Estimates </u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In preparing the financial statements in accordance with U.S. GAAP, management is required to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods and related disclosure of contingent assets and liabilities. Actual results could differ from these estimates and assumptions.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Reclassification</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Certain prior period amounts in the accompanying Consolidated Financial Statements have been reclassified to conform to the current period&#8217;s presentation.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><u>Lease Termination Income</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Lease Termination Income is recognized in operating revenues when there is a signed termination agreement, all of the conditions of the agreement have been met, the tenant is no longer occupying the property and the termination consideration is probable of collection. Lease termination amounts are paid by tenants who want to terminate their lease obligations before the end of the contractual term of the lease by agreement with the Company.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Of the Company&#8217;s 105 properties, only four leases contain an early termination provision. The Company&#8217;s leases with early termination provisions are the 26,340 square foot location in Ridgeland (Jackson), MS, the 38,333 square foot location in Rockford, IL, the 83,000 square foot location in Roanoke, VA and the 102,135 square foot location in O&#8217;Fallon (St. Louis), MO. Each lease termination provision contains certain requirements that must be met in order to exercise each termination provision. These requirements include; date termination can be exercised, the time frame that notice must be given by the tenant to the Company and the termination fee that would be required to be paid by the tenant to the Company. The total potential termination fee to be paid to the Company from the four leases with termination provisions amounts to approximately $1,709,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Stock Compensation Plan</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company&#8217;s original Stock Option and Stock Award Plan (the 2007 Plan) was initially adopted in 2007 upon approval by the Company&#8217;s shareholders on July 26, 2007. The 2007 Plan was amended and restated and approved by the Company&#8217;s shareholders on May 6, 2010. The 2007 Plan authorized the grant to officers and key employees of options to purchase up to 1,500,000 shares of common stock, $0.01 par value per share (common stock), including up to 100,000 shares of restricted stock awarded to any one participant in any one fiscal year. On March 13, 2017, upon recommendation of the Compensation Committee of the Board, the Board approved the Amended and Restated 2007 Incentive Award Plan (the Plan), conditioned upon shareholder approval. At the Company&#8217;s Annual Meeting held on May 18, 2017, the Company&#8217;s common shareholders approved the Plan and the Company subsequently filed a Registration Statement covering the offering and issuance of awards under the Plan with the Securities and Exchange Commission on July 11, 2017. The Plan constitutes an amendment and restatement of the 2007 Plan, extends the term of the 2007 Plan for an additional ten years, adds 1,600,000 shares of common stock to the share reserve, expands the types of awards available for grant under the Plan and makes other improvements to the 2007 Plan.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company accounts for awards of stock options and restricted stock in accordance with ASC 718-10, &#8220;Compensation-Stock Compensation&#8221;. ASC 718-10 requires that compensation cost for all stock awards be calculated and amortized over the service period (generally equal to the vesting period). The compensation cost for stock option grants is determined using option pricing models, intended to estimate the fair value of the awards at the grant date less estimated forfeitures. The compensation expense for restricted stock is recognized based on the fair value of the restricted stock awards less estimated forfeitures. The fair value of restricted stock awards is equal to the fair value of the Company&#8217;s stock on the grant date. The amortization of compensation costs for stock option grants and restricted stock are included in General and Administrative Expenses in the accompanying Consolidated Statements of Income and amounted to $174,709 and $99,760 for the three months ended June 30, 2017 and 2016, respectively, and amounted to $441,054 and $306,688 for the nine months ended June 30, 2017 and 2016, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017 and 2016, the following stock options, which vest one year after grant date, were granted under the Company&#8217;s 2007 Plan:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Date of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Grant</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Employees</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Shares</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Option</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Expiration</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Date</b></p></td></tr> <tr style="vertical-align: bottom"> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 1%; text-align: center">&#160;</td> <td style="width: 21%; text-align: center"><font style="font-size: 10pt">1/4/17</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%; text-align: center">&#160;</td> <td style="width: 17%; text-align: center"><font style="font-size: 10pt">1</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 17%; text-align: right"><font style="font-size: 10pt">65,000</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 17%; text-align: right"><font style="font-size: 10pt">15.04</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 16%; text-align: center"><font style="font-size: 10pt">1/4/25</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">12/9/16</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">10</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">215,000</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">14.24</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">12/9/24</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1/5/16</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">65,000</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">10.37</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1/5/24</font></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: justify">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fiscal 2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fiscal 2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 66%; text-align: justify"><font style="font-size: 10pt">Dividend yield</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">4.44</font></td> <td style="width: 1%"><font style="font-size: 10pt">%</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">6.17</font></td> <td style="width: 1%"><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: justify"><font style="font-size: 10pt">Expected volatility</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">18.84</font></td> <td><font style="font-size: 10pt">%</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">20.20</font></td> <td><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: justify"><font style="font-size: 10pt">Risk-free interest rate</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">2.26</font></td> <td><font style="font-size: 10pt">%</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">2.09</font></td> <td><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: justify"><font style="font-size: 10pt">Expected lives (years)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">8</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">8</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: justify"><font style="font-size: 10pt">Estimated forfeitures</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The weighted-average fair value of options granted during the nine months ended June 30, 2017 and 2016 was $1.49 and $0.74 per option, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017 and 2016, no shares of restricted stock were granted and during the nine months ended June 30, 2016, one participant forfeited 3,232 shares of restricted stock under the 2007 Plan. During the nine months ended June 30, 2016, five participants exercised options awarded under the 2007 Plan to purchase an aggregate of 180,000 shares of common stock at a weighted average exercise price of $7.84 per share for total proceeds of $1,412,050. During the nine months ended June 30, 2017, no options were exercised. As of June 30, 2017, a total of 1,764,878 shares were available for grant as stock options, as restricted stock, or other equity based awards, plus any shares subject to outstanding options that expire or are forfeited without being exercised, and there were outstanding options to purchase 735,000 shares. The aggregate intrinsic value of options outstanding as of June 30, 2017 was $2,719,550.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Recent Accounting Pronouncements</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In January 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2017-01, &#8220;Business Combinations (Topic 805): Clarifying the Definition of a Business&#8221; (ASU 2017-01). ASU 2017-01 provides revised guidance to determine when an acquisition meets the definition of a business or should be accounted for as an asset acquisition, likely resulting in more acquisitions being accounted for as asset acquisitions as opposed to business combinations. Transaction costs are capitalized for asset acquisitions while they are expensed as incurred for business combinations. ASU 2017-01 requires that, when substantially all of the fair value of an acquisition is concentrated in a single identifiable asset or a group of similar identifiable assets, the asset or group of similar identifiable assets does not meet the definition of a business. ASU 2017-01 also revises the definition of a business to include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create an output. ASU 2017-01 will be effective, on a prospective basis, for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. We adopted ASU 2017-01 prospectively as of April 1, 2017, as permitted under the standard. As a result of the implementation of this update, our property acquisitions, which under previous guidance were accounted for as business combinations, are now accounted for as acquisitions of assets. In an acquisition of assets, certain acquisition costs are capitalized as opposed to expensed under accounting for business combinations. For the period April 1, 2017 through June 30, 2017, the Company acquired five properties, for each of which it was concluded that substantially all of the fair value of the assets acquired with each property acquisition was concentrated in a single identifiable asset and did not meet the definition of a business combination under ASU 2017-01. Therefore, acquisition transaction costs associated with these property acquisitions were capitalized to real estate investments as part of the purchase price.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In August 2016, the FASB issued ASU 2016-15, &#8220;Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments&#8221;. ASU 2016-15 will make eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. ASU 2016-15 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In March 2016, the FASB issued ASU 2016-09 &#8220;Compensation &#8211; Stock Compensation: Improvements to Employee Share-Based Payment Accounting&#8221;, which relates to the accounting for employee share-based payments. ASU 2016-09 addresses several aspects of the accounting for share-based payment award transactions, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In February 2016, the FASB issued ASU 2016-02, &#8220;Leases&#8221;. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. ASU 2016-02 will be effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In January 2016, the FASB issued ASU 2016-01, &#8220;Financial Instruments &#8211; Overall: Recognition and Measurement of Financial Assets and Financial Liabilities&#8221;. ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. These changes become effective for the Company&#8217;s fiscal year beginning October 1, 2018. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements and has not determined the effects of this update on the Company&#8217;s financial position, results of operations or cash flows and disclosures at this time.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In April 2015, the FASB issued ASU 2015-03, &#8220;Interest - Imputation of Interest (Topic 835): Simplifying the Presentation of Debt Issuance Costs&#8221;. ASU 2015-03 requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability. In August 2015, the FASB issued ASU 2015-15, &#8220;Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements&#8221; (Subtopic 835-30), which clarified that debt issuance costs related to line-of-credit arrangements may be presented as an asset and amortized over the term of the line-of-credit arrangement regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company adopted these standards effective October 1, 2016. As a result, debt issuance costs related to debt liabilities that are not line-of-credit arrangements are included as a direct deduction from the related debt liability and those related to line-of-credit arrangements continue to be included as an asset on the accompanying Consolidated Balance Sheets. The effects of this standard were applied retrospectively to all prior periods presented. The effect of the change in accounting principle was the reduction in the amount of $6,272,143 of the Fixed Rate Mortgage Notes Payable liability and a corresponding reduction of the Financing Costs asset as of September 30, 2016 and a reclassification of Amortization of Financing Costs of $240,463 and $713,501 for the three and nine months ended June 30, 2016, respectively to Interest Expense, net of Amortization of Financing Costs in our Consolidated Statement of Income.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In May 2014, the FASB issued ASU 2014-09, &#8220;Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers&#8221;. The FASB issued further guidance in ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, that provides clarifying guidance in certain narrow areas and adds some practical expedients. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The effective date of ASU 2014-09 was extended by one year by ASU 2015-14, &#8220;Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date&#8221;. The new standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017. Therefore, the Company expects to adopt the standard effective October 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method, and the Company is evaluating which transition method it will elect. The Company is also in the process of evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company does not expect the adoption of this standard to have a significant impact on its consolidated financial statements and related disclosures.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying Consolidated Financial Statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Segment Reporting &#38; Financial Information</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company&#8217;s primary business is the ownership and management of real estate properties. The Company seeks to invest in well-located, modern, single-tenant, industrial buildings leased primarily to investment grade tenants or their subsidiaries on long-term net leases. The Company reviews operating and financial information for each property on an individual basis and, therefore, each property represents an individual operating segment. The Company evaluates financial performance using Net Operating Income (NOI) from property operations. NOI is defined as recurring Rental and Reimbursement Revenue, less Real Estate Taxes and Operating Expenses, such as insurance, utilities and repairs and maintenance. The Company has aggregated the properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities, including the fact that they are operated as industrial properties subject to long-term net leases primarily to investment grade tenants or their subsidiaries.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 2 &#8211; NET INCOME PER SHARE</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Basic Net Income per Common Share is calculated by dividing Net Income Attributable to Common Shareholders by the weighted-average number of common shares outstanding during the period. Diluted Net Income per Common Share is calculated by dividing Net Income Attributable to Common Shareholders by the weighted-average number of common shares outstanding plus the weighted-average number of net shares that would be issued upon exercise of stock options pursuant to the treasury stock method.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In addition, common stock equivalents of 171,719 and 125,108 shares are included in the diluted weighted-average shares outstanding for the three months ended June 30, 2017 and 2016, respectively, and common stock equivalents of 157,858 and 89,250 shares are included in the diluted weighted-average shares outstanding for the nine months ended June 30, 2017 and 2016, respectively. For the diluted weighted-average shares outstanding for the three months ended June 30, 2017 and 2016, 65,000 and -0- options to purchase shares of common stock were antidilutive. For the diluted weighted-average shares outstanding for the nine months ended June 30, 2017 and 2016, 65,000 and 65,000 options to purchase shares of common stock, respectively, were antidilutive.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 3 &#8211; REAL ESTATE INVESTMENTS</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i><u>Acquisitions accounted for as business combinations</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On October 17, 2016, the Company purchased a newly constructed 338,584 square foot industrial building located in Hamburg, NY, which is in the Buffalo Metropolitan Statistical Area (MSA). The building is 100% net-leased to FedEx Ground Package System, Inc. for 15 years through March 2031. The purchase price was $35,100,000. The Company obtained a 15 year fully-amortizing mortgage loan of $23,500,000 at a fixed interest rate of 4.03%. Annual rental revenue over the remaining term of the lease averages approximately $2,309,000. In connection with the acquisition, the Company completed its evaluation of the acquired lease. As a result of its evaluation, the Company allocated $250,000 to an Intangible Asset associated with the lease in-place.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On December 30, 2016, the Company purchased a newly constructed 213,672 square foot industrial building located in Ft. Myers, FL. The building is 100% net-leased to FedEx Ground Package System, Inc. for 10 years through September 2026. The purchase price was $21,001,538. The Company obtained a 15 year fully-amortizing mortgage loan of $14,500,000 at a fixed interest rate of 3.97%. Annual rental revenue over the remaining term of the lease averages approximately $1,365,000. In connection with the acquisition, the Company completed its evaluation of the acquired lease. As a result of its evaluation, the Company allocated $201,538 to an Intangible Asset associated with the lease in-place.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i><u>Acquisitions accounted for as asset acquisitions </u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On April 5, 2017, the Company purchased a newly constructed 343,483 square foot industrial building located in Walker, MI, which is in the Grand Rapids MSA. The building is 100% net-leased to FedEx Ground Package System, Inc. for 15 years through January 2032. The purchase price was $32,120,000. The Company obtained a 15 year fully-amortizing mortgage loan of $20,875,000 at a fixed interest rate of 3.86%. Annual rental revenue over the remaining term of the lease averages approximately $2,102,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On June 23, 2017, the Company purchased a newly constructed 351,874 square foot industrial building located in Mesquite, TX, which is in the Dallas MSA. The building is 100% net-leased to FedEx Ground Package System, Inc. for 15 years through March 2032. The purchase price was $50,621,072. The Company obtained a 15 year fully-amortizing mortgage loan of $32,900,000 at a fixed interest rate of 3.60%. Annual rental revenue over the remaining term of the lease averages approximately $3,194,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On June 27, 2017, the Company purchased a newly constructed 315,560 square foot industrial building located in Aiken, SC, which is in the Augusta, GA MSA. The building is 100% net-leased to Autoneum North America, Inc. for 15 years through April 2032. The purchase price was $21,933,000. The Company obtained a 15 year fully-amortizing mortgage loan of $15,350,000 at a fixed interest rate of 4.20%. Annual rental revenue over the remaining term of the lease averages approximately $1,700,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On June 28, 2017, the Company purchased a newly-constructed 237,756 square foot industrial building located in Homestead, FL, which is in the Miami MSA. The building is 100% net leased to FedEx Ground Package System, Inc. for 15 years through March 2032. The purchase price was $38,347,933. The Company obtained a 15 year fully-amortizing mortgage loan of $24,800,000 at a fixed interest rate of 3.60%. Annual rental revenue over the remaining term of the lease averages approximately $2,282,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On June 29, 2017, the Company purchased a newly constructed 110,361 square foot industrial building located in Oklahoma City, OK. The building is 100% net-leased to Bunzl Distribution Oklahoma, Inc. for seven years through August 2024. The purchase price was $9,000,000. The Company obtained a 12 year fully-amortizing mortgage loan of $6,000,000 at a fixed interest rate of 4.125%. Annual rental revenue over the remaining term of the lease averages approximately $721,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company evaluated the property acquisitions which took place subsequent to March 31, 2017, under the new framework for determining whether an integrated set of assets and activities meets the definition of a business, pursuant to ASU 2017-01, which the Company early-adopted effective April 1, 2017. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions (see Note 1). Accordingly, the Company accounted for the properties purchased in Walker (Grand Rapids), MI; Mesquite (Dallas), TX; Aiken (Augusta, GA), SC; Homestead (Miami), FL and Oklahoma City, OK as asset acquisitions and allocated the total cash consideration, including transaction costs, to the individual assets acquired on a relative fair value basis. There were no liabilities assumed in these acquisitions. The financial information set forth below summarizes the Company&#8217;s preliminary purchase price allocation for these five properties acquired during the three months ended June 30, 2017 that are accounted for as asset acquisitions:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 74%"><font style="font-size: 10pt">Land</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 23%; text-align: right"><font style="font-size: 10pt">16,915,800</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Building</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">132,260,865</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">In-Place Leases</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">3,112,332</font></td> <td>&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">The following table summarizes the operating results included in the Company&#8217;s consolidated statements of income for the three and nine months ended June 30, 2017 for the properties acquired during the nine months ended June 30, 2017:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td>&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Three Months Ended 6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Nine Months Ended 6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td>&#160;</td> <td>&#160;</td> <td colspan="2">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 66%; padding-left: 5.4pt; text-align: justify"><font style="font-size: 10pt">Rental Revenues</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">1,712,249</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">3,234,951</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 5.4pt"><font style="font-size: 10pt">Net Income Attributable to Common Shareholders</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">598,783</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">925,316</font></td> <td>&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i>&#160;&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i><u>Expansions</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On October 1, 2016, a 50,625 square foot expansion of the building leased to FedEx Ground Package System, Inc. located in Edinburg, TX was completed for a cost of approximately $4,762,000, resulting in a new 10 year lease, which extended the prior lease expiration date from September 2021 through September 2026. In addition, the expansion resulted in an increase in annual rent effective from the date of completion of approximately $499,000 from approximately $598,000, or $5.27 per square foot, to approximately $1,097,000, or $6.68 per square foot.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i><u>Disposition</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On October 27, 2016, the Company sold its only vacant building consisting of a 59,425 square foot industrial building situated on 4.78 acres located in White Bear Lake, MN for net proceeds of approximately $4,126,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Since the sale of this property does not represent a strategic shift that has (or will have) a major effect on the Company&#8217;s operations and financial results, the operations generated from this property are not included in Discontinued Operations.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The following table summarizes the operations of this property prior to its sale on October 27, 2016 which is included in the accompanying Consolidated Statements of Income for the three and nine months ended June 30, 2017 and 2016:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Three Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Nine Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%"><font style="font-size: 10pt">Rental and Reimbursement Revenue</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Real Estate Taxes</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(28,159</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(8,855</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(68,776</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Operating Expenses</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(32,022</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(9,846</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(52,363</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Depreciation &#38; Amortization</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(24,017</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(8,006</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(73,055</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Interest Expense</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Loss from Operations</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(84,198</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(26,707</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(194,194</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Loss on Sale of Real Estate Investment</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(95,336</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Net Loss</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(84,198</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(122,043</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(194,194</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i><u>Pro forma information</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The following unaudited pro forma condensed financial information has been prepared utilizing the historical financial statements of the Company and the effect of additional revenue and expenses generated from property acquired and expanded during fiscal 2017 to date, and during fiscal 2016, assuming that the acquisitions and completed expansions had occurred as of October 1, 2015, after giving effect to certain adjustments including: (a) Rental Revenue adjustments resulting from the straight-lining of scheduled rent increases, (b) Interest Expense resulting from the assumed increase in Fixed Rate Mortgage Notes Payable and Loans Payable related to the new acquisitions, and (c) Depreciation Expense related to the new acquisitions. As further described in Note 6, the net proceeds raised from the issuance of the 6.125% Series C Cumulative Redeemable Preferred Stock less the redemptions of the Company&#8217;s 7.625% Series A Cumulative Redeemable Preferred Stock and the Company&#8217;s 7.875% Series B Cumulative Redeemable Preferred Stock were used to help fund property acquisitions and, therefore, the pro forma preferred dividend expense has been adjusted to account for its effect on Net Income Attributable to Common Shareholders as if all the preferred stock issuances and redemptions had occurred on October 1, 2015. In addition, Net Income Attributable to Common Shareholders excludes the operating expenses incurred during fiscal 2017 and 2016 for the vacant property, located in White Bear Lake, MN, that was sold on October 27, 2016. Furthermore, the proceeds raised from the Dividend Reinvestment and Stock Purchase Plan (the DRIP) were used to fund property acquisitions and expansions and therefore, the weighted average shares outstanding used in calculating the Basic and Diluted Net Income per Share Attributable to Common Shareholders has been adjusted to account for the increase in shares raised through the DRIP, as if all the shares raised had occurred on October 1, 2015. The unaudited pro forma condensed financial information is not indicative of the results of operations that would have been achieved had the acquisitions and expansions reflected herein been consummated on the dates indicated or that will be achieved in the future.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i>&#160;</i></p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Three Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Nine Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%; text-align: justify"><font style="font-size: 10pt">Rental Revenue</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">26,224,800</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">26,973,500</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">78,455,200</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">78,995,500</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Net Income Attributable to Common Shareholders</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">5,160,600</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">7,865,900</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">15,261,700</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">16,596,200</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Basic and Diluted Net Income per Share Attributable to Common Shareholders</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.07</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.11</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.21</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.23</font></td> <td>&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i><u>Tenant Concentration</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company has a concentration of FedEx Corporation (FDX) and FDX subsidiary-leased properties, consisting of 58 separate stand-alone leases covering approximately 9,124,000 square feet as of June 30, 2017 and 51 separate stand-alone leases covering approximately 6,944,000 square feet as of June 30, 2016. The 58 separate stand-alone leases that are leased to FDX and FDX subsidiaries have a weighted average lease maturity of 8.4 years. The percentage of FDX and its subsidiaries leased square footage to the total of the Company&#8217;s rental space was 51% (8% to FDX and 43% to FDX subsidiaries) as of June 30, 2017 and 46% (6% to FDX and 40% to FDX subsidiaries) as of June 30, 2016. As of June 30, 2017, the only tenants that leased 5% or more of the Company&#8217;s total square footage were FDX and its subsidiaries and Milwaukee Electric Tool Corporation, which leases one property through July 2028 consisting of approximately 862,000 square feet, which was approximately 5% of the Company&#8217;s rental space. As of June 30, 2016, no other tenant, other than FDX and its subsidiaries, accounted for 5% or more of the Company&#8217;s total rental space.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Annualized Rental and Reimbursement Revenue from FDX and its subsidiaries is estimated to be approximately 60% (7% to FDX and 53% to FDX subsidiaries) of total Rental and Reimbursement Revenue for fiscal 2017 and was 56% (7% to FDX and 49% to FDX subsidiaries) of total Rental and Reimbursement Revenue for fiscal 2016. No other tenant accounted for 5% or more of the Company&#8217;s total Rental and Reimbursement Revenue for the nine months ended June 30, 2017 and 2016.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">FDX is a publicly-owned company and financial information related to this entity is available at the SEC&#8217;s website, <u>www.sec.gov</u>. FDX is rated &#8220;BBB&#8221; by S&#38;P Global Ratings (www.standardandpoors.com) and is rated &#8220;Baa2&#8221; by Moody&#8217;s (www.moodys.com), which are both considered &#8220;Investment Grade&#8221; ratings. The references in this report to the SEC&#8217;s website, S&#38;P Global Ratings&#8217; website and Moody&#8217;s website are not intended to and do not include or incorporate by reference into this report the information of FDX, S&#38;P Global Ratings or Moody&#8217;s on such websites.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In addition to real estate property holdings, the Company held $100,495,810 in marketable REIT securities at June 30, 2017, representing 6.6% of the Company&#8217;s undepreciated assets (which is the Company&#8217;s total assets excluding accumulated depreciation). These liquid real estate holdings are not included in calculating the tenant concentration ratios above and therefore further enhance the Company&#8217;s diversification. The securities portfolio provides the Company with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 4 &#8211; SECURITIES AVAILABLE FOR SALE AT FAIR VALUE </u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company&#8217;s Securities Available for Sale at Fair Value consists primarily of marketable common and preferred stock of other REITs with a fair value of $100,495,810 as of June 30, 2017. The Company generally limits its investment in marketable securities to no more than approximately 10% of its undepreciated assets (which is the Company&#8217;s total assets excluding accumulated depreciation). The REIT securities portfolio provides the Company with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017, the Company sold or redeemed securities with a cost basis of $8,399,268 and recognized a Gain on Sale of Securities Transactions of $2,293,944. In addition, the Company recognized dividend income on its investment in securities of $4,622,836 for the nine months ended June 30, 2017. The Company also made purchases of $39,467,317 in Securities Available for Sale at Fair Value. Of this amount, the Company made total purchases of 125,719 common shares of UMH Properties, Inc. (UMH), a related REIT, for a total cost of $1,725,457, or a weighted average cost of $13.72 per share, of which 112,719 shares were purchased through UMH&#8217;s Dividend Reinvestment and Stock Purchase Plan. The Company owned a total of 1,115,046 UMH common shares as of June 30, 2017 at a total cost of $11,031,142 and a fair value of $19,011,526. The Company owns 200,000 shares of UMH&#8217;s 8.25% Series A Cumulative Redeemable Preferred Stock at a total cost of $5,000,000 with a fair value of $5,200,000 and the Company owns 100,000 shares of UMH&#8217;s 8.00% Series B Cumulative Redeemable Preferred Stock at a total cost of $2,500,000 with a fair value of $2,750,000. The unrealized gain on the Company&#8217;s investment in UMH&#8217;s common and preferred stock as of June 30, 2017 was $8,430,384.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">As of June 30, 2017, the Company had total net unrealized holding gains on its securities portfolio of $8,765,134. The Company considers many factors in determining whether a security is other than temporarily impaired, including the nature of the security and the cause, severity and duration of the impairment. The Company normally holds REIT securities long-term and has the ability and intent to hold these securities to recovery. The following is a summary of the securities that the Company has determined to be temporarily impaired as of June 30, 2017:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Less than 12 Months</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>12 Months or Longer</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td>&#160;</td> <td>&#160;</td> <td colspan="2">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center"><font style="font-size: 10pt"><b>Unrealized</b></font></td> <td>&#160;</td> <td>&#160;</td> <td colspan="2">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center"><font style="font-size: 10pt"><b>Unrealized</b></font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt"><b>Description of Securities</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fair Value</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Losses</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fair Value</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Losses</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%"><font style="font-size: 10pt">Preferred stock</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">2,127,800</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">(52,587</font></td> <td style="width: 1%"><font style="font-size: 10pt">)</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Common stock</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">28,819,800</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(3,087,363</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">30,947,600</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(3,139,950</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following is a summary of the range of losses:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Individual</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Securities</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Fair</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Value</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Unrealized</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Losses</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Range of </b></font><br /> <font style="font-size: 10pt"><b>Loss</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 1%">&#160;</td> <td style="width: 25%; text-align: center"><font style="font-size: 10pt">3</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 21%; text-align: right"><font style="font-size: 10pt">11,895,800</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 21%; text-align: right"><font style="font-size: 10pt">(567,137</font></td> <td style="width: 1%"><font style="font-size: 10pt">)</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 22%; text-align: center"><font style="font-size: 10pt">1%-5%</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">1</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">19,051,800</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(2,572,813</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: center"><font style="font-size: 10pt">12%</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="border-bottom: black 2.25pt double">&#160;</td> <td style="border-bottom: black 2.25pt double; text-align: center"><font style="font-size: 10pt">4</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">30,947,600</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(3,139,950</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 5 &#8211; DEBT</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">For the three months ended June 30, 2017 and 2016, amortization of financing costs included in interest expense was $283,573 and $240,463, respectively. For the nine months ended June 30, 2017 and 2016, amortization of financing costs included in interest expense was $949,470 and $713,501, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The following is a summary of our Fixed Rate Mortgage Notes Payable as of June 30, 2017 and September 30, 2016:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>9/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Amount</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted Average Interest</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Rate (1)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Amount</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted Average Interest</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Rate (1)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%; padding-bottom: 1.5pt"><font style="font-size: 10pt">Fixed Rate Mortgage Notes Payable</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">561,736,464</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 10%; padding-bottom: 1.5pt; text-align: right"><font style="font-size: 10pt">4.21</font></td> <td style="width: 1%; padding-bottom: 1.5pt"><font style="font-size: 10pt">%</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">483,748,153</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 10%; padding-bottom: 1.5pt; text-align: right"><font style="font-size: 10pt">4.48</font></td> <td style="width: 1%; padding-bottom: 1.5pt"><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Debt Issuance Costs</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">10,171,381</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">9,424,697</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Accumulated Amortization of Debt Issuance Costs</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(2,921,873</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(3,152,554</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Unamortized Debt Issuance Costs</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">7,249,508</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">6,272,143</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">554,486,956</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">477,476,010</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: top"> <td style="width: 48px">&#160;</td> <td style="width: 24px"><font style="font-size: 10pt">(1)</font></td> <td style="text-align: justify"><font style="font-size: 10pt">Weighted average interest rate excludes amortization of debt issuance costs.</font></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">As of June 30, 2017, interest payable on these mortgages were at fixed rates ranging from 3.45% to 7.60%, with a weighted average interest rate of 4.21%. This compares to a weighted average interest rate of 4.48% as of September 30, 2016 and 4.61% as of June 30, 2016. As of June 30, 2017, the weighted average loan maturity of the Fixed Rate Mortgage Notes Payable was 11.5 years. This compares to a weighted average loan maturity of the Fixed Rate Mortgage Notes Payable of 10.5 years as of September 30, 2016 and 9.8 years as of June 30, 2016.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In connection with the seven properties acquired during the nine months ended June 30, 2017, which are located in Hamburg (Buffalo), NY; Ft. Myers, FL; Walker (Grand Rapids), MI; Mesquite (Dallas), TX; Aiken (Augusta, GA), SC; Homestead (Miami), FL and Oklahoma City, OK (as described in Note 3), the Company obtained six, 15 year, fully-amortizing mortgage loans and one, 12 year, fully-amortizing loan. The seven mortgage loans originally totaled $137,925,000 with an original weighted average mortgage loan maturity of 14.9 years and a weighted average interest rate of 3.84%.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017, the Company fully repaid 15 mortgage loans associated with 14 of its properties located in Jacksonville, FL; El Paso, TX; Lebanon (Cincinnati), OH; Halfmoon (Albany), NY; Bedford Heights (Cleveland), OH; Hanahan (Charleston), SC; Elgin (Chicago), IL; Kansas City, MO; Chattanooga, TN; Roanoke, VA; Orion, MI; Edwardsville, KS; Punta Gorda, FL and Cheektowaga (Buffalo), NY, totaling approximately $35,266,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017, the Company fully repaid its two term loans totaling $4,768,266. One loan totaling $2,284,633 had an interest rate of 4.90% and one loan totaling $2,483,633 had a variable annual interest rate of prime plus 0.75% with a floor of 4.50%. The interest rate on the date this loan was fully repaid was 4.50%.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">As of June 30, 2017, Loans Payable represented the amount drawn down on the Company&#8217;s $200,000,000 unsecured line of credit facility (the Facility) in the amount of $110,000,000 and the amount drawn down on the Company&#8217;s margin line of credit on its marketable securities in the amount of $12,094,940.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Facility matures in September 2020 with a one year extension at the Company&#8217;s option (subject to various conditions as specified in the loan agreement). During the nine months ended June 30, 2017, the Company had net draws of $34,000,000 under the Facility. Availability under the Facility is limited to 60% of the value of the borrowing base properties. The value of the borrowing base properties is determined by applying a 7.0% capitalization rate to the NOI generated by the Company&#8217;s unencumbered, wholly-owned industrial properties. Borrowings under the Facility, will, at the Company&#8217;s election, either i) bear interest at LIBOR plus 140 basis points to 220 basis points, depending on the Company&#8217;s leverage ratio, or ii) bear interest at BMO&#8217;s prime lending rate plus 40 basis points to 120 basis points, depending on the Company&#8217;s leverage ratio. The Company&#8217;s borrowings as of June 30, 2017, based on the Company&#8217;s leverage ratio as of June 30, 2017, bear interest at LIBOR plus 150 basis points, which was at an interest rate of 2.54% as of June 30, 2017. In addition, the Company has a $100,000,000 accordion feature, bringing the total potential availability under the Facility (subject to various conditions as specified in the loan agreement) up to $300,000,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company also invests in equity securities of other REITs which provides the Company with additional liquidity, diversification and income and serves as a proxy for real estate when more favorable risk adjusted returns are not available. The Company from time to time may purchase these securities on margin when the interest and dividend yields exceed the cost of funds. In general, the Company may borrow up to 50% of the value of the marketable securities, which was $100,495,810 as of June 30, 2017. As of June 30, 2017, the Company had borrowings of $12,094,940 under its margin line, bearing interest at 2.05%.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><u>NOTE 6 &#8211; SHAREHOLDERS&#8217; EQUITY </u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company&#8217;s authorized stock as of June 30, 2017 consisted of 192,039,750 shares of common stock, of which 73,824,161 shares were issued and outstanding, 12,400,000 authorized shares of 6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 par value per share (6.125% Series C Preferred Stock), of which 8,400,000 were issued and outstanding, and 200,000,000 authorized shares of Excess Stock, $0.01 par value per share, of which none were issued or outstanding.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i><u>Common Stock</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On October 1, 2015, the Company&#8217;s Board of Directors approved a 6.7% increase in the Company&#8217;s quarterly common stock dividend, raising it to $0.16 per share from $0.15 per share. This represents an annualized dividend rate of $0.64 per share. The Company has maintained or increased its cash dividend for 25 consecutive years.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company raised $66,340,821 (including dividend reinvestments of $7,229,654) from the issuance of 4,903,189 shares of common stock under its DRIP during the nine months ended June 30, 2017. During the nine months ended June 30, 2017, the Company paid $34,311,041 in total cash dividends, or $0.16 per share, to common shareholders, of which $7,229,654 was reinvested in the DRIP.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On July 3, 2017, the Company declared a dividend of $0.16 per share to be paid September 15, 2017 to common shareholders of record as of the close of business on August 15, 2017.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On January 17, 2017, the Board of Directors reaffirmed its Share Repurchase Program that authorizes the Company to purchase up to $10,000,000 in the aggregate of the Company&#8217;s common stock. The Company may repurchase its shares from time to time if, in the opinion of the Board of Directors, such acquisition is advantageous to the Company. No shares were repurchased during the nine months ended June 30, 2017 and, as of June 30, 2017, the Company does not own any of its own shares.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i><u>7.625% Series A Cumulative Redeemable Preferred Stock</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On September 14, 2016, the Company announced that it intended to redeem all 2,139,750 issued and outstanding shares of its 7.625% Series A Cumulative Redeemable Preferred Stock, $0.01 par value per share (7.625% Series A Preferred Stock). The Company redeemed all of the outstanding shares of the 7.625% Series A Preferred Stock on October 14, 2016, at a redemption price of $25.00 per share, totaling $53,493,750, plus all dividends accrued and unpaid to and including, the redemption date, in an amount equal to $0.23299 per share, totaling $498,540, for a total cash payment of $25.23299 per share, totaling $53,992,290.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i><u>7.875% Series B Cumulative Redeemable Preferred Stock</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On May 5, 2017, the Company announced that it intended to redeem all 2,300,000 issued and outstanding shares of its 7.875% Series B Cumulative Redeemable Preferred Stock, $0.01 par value per share (7.875% Series B Preferred Stock). The Company redeemed all of the outstanding shares of the 7.875% Series B Preferred Stock on June 7, 2017, at a redemption price of $25.00 per share, totaling $57,500,000, plus accumulated and unpaid dividends for the period from June 1, 2017 to, but not including, the redemption date, in an amount equal to $0.0328125, totaling $75,469, for a total cash payment of $25.0328125 per share, totaling $57,575,469. The Company recognized a preferred share redemption charge of approximately $2,467,000 related to the original issuance costs. During the nine months ended June 30, 2017, the Company paid $3,471,566 in Preferred Dividends, or $1.509375 per share, on its then outstanding 7.875% Series B Preferred Stock.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i><u>6.125% Series C Cumulative Redeemable Preferred Stock</u></i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><i>&#160;</i></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On March 9, 2017, the Company issued an additional 3,000,000 shares of its 6.125% Series C Preferred Stock, liquidation preference of $25.00 per share, at a public offering price of $24.50 per share, for gross proceeds of $73,500,000 before deducting the underwriting discount and offering expenses. Net proceeds from the offering, after deducting underwriting discounts and other offering expenses were approximately $71,003,000. The Company used the net proceeds from this offering to redeem all of the outstanding shares of its 7.875% Series B Preferred Stock, as discussed above. The remaining proceeds were used to purchase properties in the ordinary course of business and for general corporate purposes. Prior to the issuance of the additional 3,000,000 shares of the 6.125% Series C Preferred Stock on March 9, 2017, the Company had 5,400,000 shares of the 6.125% Series C Preferred Stock issued and outstanding. As of June 30, 2017, 8,400,000 shares of the 6.125% Series C Preferred Stock were issued and outstanding.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017, the Company paid $7,074,383 in Preferred Dividends, or $1.0973965 per share, on its outstanding 6.125% Series C Preferred Stock for the period September 13, 2016 through May 31, 2017. Dividends on the 6.125% Series C Preferred Stock are cumulative and payable quarterly at an annual rate of $1.53125 per share. The 6.125% Series C Preferred Stock has no maturity date and will remain outstanding indefinitely unless redeemed or otherwise repurchased. Except in limited circumstances relating to the Company&#8217;s qualification as a REIT, the 6.125% Series C Preferred Stock is not redeemable prior to September 15, 2021. On and after September 15, 2021, at any time, and from time to time, the 6.125% Series C Preferred Stock will be redeemable in whole, or in part, at the Company&#8217;s option, at a cash redemption price of $25.00 per share, plus all accrued and unpaid dividends (whether or not declared) to, but not including, the date of redemption. On July 3, 2017, the Company declared a dividend of $0.3828125 per share to be paid September 15, 2017 to the 6.125% Series C Preferred shareholders of record as of the close of business on August 15, 2017.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On June 29, 2017, the Company entered into an At-The-Market Preferred Equity Program (ATM Preferred Stock Program) with FBR Capital Markets &#38; Co. in which the Company may, from time to time, offer and sell additional shares of its 6.125% Series C Preferred Stock, with a liquidation preference of $25.00 per share, having an aggregate sales price of up to $100,000,000. The Company began selling shares through the ATM Preferred Stock Program on July 3, 2017. Therefore, as of June 30, 2017, no shares were sold under the ATM Preferred Stock Program. Subsequent to the quarter end, through July 25, 2017, the Company sold 627,867 shares under its ATM Preferred Stock Program at a weighted average price of $25.44 per share, and realized net proceeds, after offering expenses, of approximately $15,628,000.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 7 - FAIR VALUE MEASUREMENTS</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><b>&#160;</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company measures certain financial assets and liabilities at fair value on a recurring basis, including Securities Available for Sale at Fair Value. The Company&#8217;s financial assets consist mainly of marketable REIT securities. The fair value of these financial assets was determined using the following inputs at June 30, 2017 and September 30, 2016:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr> <td style="vertical-align: bottom; padding-bottom: 1.5pt; text-align: justify">&#160;</td> <td style="vertical-align: bottom; padding-bottom: 1.5pt">&#160;</td> <td colspan="14" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fair Value Measurements at Reporting Date Using</b></font></td> <td style="vertical-align: bottom; padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: center">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Total</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Quoted Prices<br /> in Active<br /> Markets for<br /> Identical<br /> Assets</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>(Level 1)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Significant Other Observable Inputs</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>(Level 2)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Significant Unobservable Inputs</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>(Level 3)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt"><b><u>As of June 30, 2017:</u></b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 44%"><font style="font-size: 10pt">Equity Securities &#8211; Preferred Stock</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 11%; text-align: right"><font style="font-size: 10pt">14,688,025</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 12%; text-align: right"><font style="font-size: 10pt">14,688,025</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 9%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 12%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Equity Securities &#8211; Common Stock</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">85,803,256</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">85,803,256</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Mortgage Backed Securities</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">4,529</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">4,529</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total Securities Available for Sale at Fair Value</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">100,495,810</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">100,495,810</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt"><b><u>As of September 30, 2016:</u></b></font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Equity Securities &#8211; Preferred Stock</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">13,769,073</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">13,769,073</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Equity Securities &#8211; Common Stock</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">59,830,271</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">59,830,271</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Mortgage Backed Securities</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">5,550</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">5,550</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total Securities Available for Sale at Fair Value</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">73,604,894</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">73,604,894</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In addition to the Company&#8217;s investments in Securities Available for Sale at Fair Value, the Company is required to disclose certain information about fair values of its other financial instruments. Estimates of fair value are made at a specific point in time based upon, where available, relevant market prices and information about the financial instrument. Such estimates do not include any premium or discount that could result from offering for sale at one time the Company&#8217;s entire holdings of a financial instrument. For a portion of the Company&#8217;s other financial instruments, no quoted market value exists. Therefore, estimates of fair value are necessarily based on a number of significant assumptions (many of which involve events outside the control of management). Such assumptions include assessments of current economic conditions, perceived risks associated with these financial instruments and their counterparties; future expected loss experience and other factors. Given the uncertainties surrounding these assumptions, the reported fair values represent estimates only, and therefore cannot be compared to the historical accounting model. The use of different assumptions or methodologies is likely to result in significantly different fair value estimates.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The fair value of Cash and Cash Equivalents approximates their current carrying amounts since all such items are short term in nature. The fair value of variable rate Loans Payable approximates their current carrying amounts, since such amounts payable are at approximately a weighted-average current market rate of interest. The estimated fair value of Fixed Rate Mortgage Notes Payable is based on discounting the future cash flows at a yearend risk adjusted borrowing rate currently available to the Company for issuance of debt with similar terms and remaining maturities. These fair value measurements fall within level 2 of the fair value hierarchy. At June 30, 2017, the Fixed Rate Mortgage Notes Payable fair value (estimated based upon expected cash outflows discounted at current market rates) amounted to approximately $571,364,000 and the carrying value amounted to $561,736,464. When the Company acquires a property and is accounted for as a business combination, it is required to fair value all of the assets and liabilities, including intangible assets and liabilities, relating to the properties acquired lease (see Note 3). Those fair value measurements are estimated based on independent third party appraisals and fall within level 3 of the fair value hierarchy.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 8 - SUPPLEMENTAL CASH FLOW INFORMATION</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Cash paid for interest during the nine months ended June 30, 2017 and 2016 was approximately $17,975,000 and $15,994,000, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017 and 2016, the Company had dividend reinvestments of $7,229,654 and $6,326,691, respectively, which required no cash transfers.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 9 &#8211; CONTINGENCIES AND COMMITMENTS</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">From time to time, the Company may be subject to claims and litigation in the ordinary course of business. Management does not believe that any such claim or litigation will have a material adverse effect on the Consolidated Balance Sheets or results of operations.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In addition to the property purchased subsequent to the quarter end, as described below in Note 10, the Company has entered into agreements to purchase four new build-to-suit, industrial buildings that are currently being developed in Florida, Ohio and South Carolina, totaling approximately 1,039,000 square feet with net-leased terms ranging from 10 to 15 years, resulting in a weighted average lease maturity of 10.6 years. The aggregate purchase price for the four properties is approximately $88,676,000. Two of the four purchase commitments consisting of approximately 420,300 square feet, or 40%, are leased to investment grade tenants. Approximately 121,800 square feet, or 12%, is leased to FDX. Subject to satisfactory due diligence, we anticipate closing these four transactions during the remainder of fiscal 2017 and the first half of fiscal 2018. In connection with the four properties, the Company has entered into commitments to obtain three mortgage loans totaling approximately $38,300,000 at fixed rates ranging from 4.17% to 4.45%, with a weighted average interest rate of 4.28%. All three of these mortgage loans are 15 year, fully-amortizing loans.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company currently has parking lot expansions in progress on two properties that are being leased to FedEx Ground Package System, Inc. located in Ft. Myers, FL and Indianapolis, IN. The expansion costs are expected to be approximately $2,661,000. Upon completion, annualized rent will be increased by approximately $237,000 from approximately $2,898,000 to approximately $3,135,000 and will provide for a new lease extension, for each property being expanded, of 10 years from the date of completion.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>NOTE 10 &#8211; SUBSEQUENT EVENTS</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Material subsequent events have been evaluated and are disclosed herein.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On August 3, 2017, the Company purchased a newly constructed 354,482 square foot industrial building located in Concord, NC which is in the Charlotte MSA. The building is 100% net leased to FedEx Ground Package System, Inc. for 15 years through May 2032. The purchase price was $40,598,446. The Company obtained a 15 year fully-amortizing mortgage loan of $26,184,000 at a fixed interest rate of 3.80%. Annual rental revenue over the remaining term of the lease averages approximately $2,537,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Subsequent to quarter end, through July 25, 2017, the Company sold 627,867 shares under its ATM Preferred Stock Program at a weighted average price of $25.44 per share, and realized net proceeds, after offering expenses, of approximately $15,628,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In July 2017, the Company entered into a 10.2 year lease agreement with FBM Gypsum Supply of Illinois, LLC through December 31, 2027, for our previously vacant 36,270 square foot building, which became vacant effective June 1, 2017, located in Urbandale, IA. The lease is expected to commence on November 1, 2017, with two months of free rent, after which initial annual rent of $159,588, representing $4.40 per square foot, will commence, with 2.0% annual increases thereafter, resulting in a straight-line annualized rent of $171,880, representing $4.74 per square foot over the life of the lease. This compares to the former average straight-lined rent, prior to the property becoming vacant, of $3.56 per square foot on a U.S. GAAP straight-line basis and the former cash rent of $3.88 per square foot, representing an increase in the average lease rate of 33.2% on a U.S. GAAP straight-line basis and an increase in the lease rate of 13.4% on a cash basis. The tenant will have a one-time early termination option that may be exercised after December 31, 2025, provided that the tenant provides the Company with six months of notice and pays a termination fee equal to three months of rent, plus operating and other costs.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On July 3, 2017, the Company declared a common dividend of $0.16 per share to be paid September 15, 2017 to common shareholders of record as of the close of business on August 15, 2017.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">On July 3, 2017, the Company declared a preferred dividend of $0.3828125 per share to be paid September 15, 2017 to Series C preferred shareholders of record as of the close of business on August 15, 2017.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Use of Estimates </u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In preparing the financial statements in accordance with U.S. GAAP, management is required to make certain estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods and related disclosure of contingent assets and liabilities. Actual results could differ from these estimates and assumptions.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Reclassification</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Certain prior period amounts in the accompanying Consolidated Financial Statements have been reclassified to conform to the current period&#8217;s presentation.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><u>Lease Termination Income</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Lease Termination Income is recognized in operating revenues when there is a signed termination agreement, all of the conditions of the agreement have been met, the tenant is no longer occupying the property and the termination consideration is probable of collection. Lease termination amounts are paid by tenants who want to terminate their lease obligations before the end of the contractual term of the lease by agreement with the Company.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Of the Company&#8217;s 105 properties, only four leases contain an early termination provision. The Company&#8217;s leases with early termination provisions are the 26,340 square foot location in Ridgeland (Jackson), MS, the 38,333 square foot location in Rockford, IL, the 83,000 square foot location in Roanoke, VA and the 102,135 square foot location in O&#8217;Fallon (St. Louis), MO. Each lease termination provision contains certain requirements that must be met in order to exercise each termination provision. These requirements include; date termination can be exercised, the time frame that notice must be given by the tenant to the Company and the termination fee that would be required to be paid by the tenant to the Company. The total potential termination fee to be paid to the Company from the four leases with termination provisions amounts to approximately $1,709,000.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Stock Compensation Plan</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company&#8217;s original Stock Option and Stock Award Plan (the 2007 Plan) was initially adopted in 2007 upon approval by the Company&#8217;s shareholders on July 26, 2007. The 2007 Plan was amended and restated and approved by the Company&#8217;s shareholders on May 6, 2010. The 2007 Plan authorized the grant to officers and key employees of options to purchase up to 1,500,000 shares of common stock, $0.01 par value per share (common stock), including up to 100,000 shares of restricted stock awarded to any one participant in any one fiscal year. On March 13, 2017, upon recommendation of the Compensation Committee of the Board, the Board approved the Amended and Restated 2007 Incentive Award Plan (the Plan), conditioned upon shareholder approval. At the Company&#8217;s Annual Meeting held on May 18, 2017, the Company&#8217;s common shareholders approved the Plan and the Company subsequently filed a Registration Statement covering the offering and issuance of awards under the Plan with the Securities and Exchange Commission on July 11, 2017. The Plan constitutes an amendment and restatement of the 2007 Plan, extends the term of the 2007 Plan for an additional ten years, adds 1,600,000 shares of common stock to the share reserve, expands the types of awards available for grant under the Plan and makes other improvements to the 2007 Plan.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company accounts for awards of stock options and restricted stock in accordance with ASC 718-10, &#8220;Compensation-Stock Compensation&#8221;. ASC 718-10 requires that compensation cost for all stock awards be calculated and amortized over the service period (generally equal to the vesting period). The compensation cost for stock option grants is determined using option pricing models, intended to estimate the fair value of the awards at the grant date less estimated forfeitures. The compensation expense for restricted stock is recognized based on the fair value of the restricted stock awards less estimated forfeitures. The fair value of restricted stock awards is equal to the fair value of the Company&#8217;s stock on the grant date. The amortization of compensation costs for stock option grants and restricted stock are included in General and Administrative Expenses in the accompanying Consolidated Statements of Income and amounted to $174,709 and $99,760 for the three months ended June 30, 2017 and 2016, respectively, and amounted to $441,054 and $306,688 for the nine months ended June 30, 2017 and 2016, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017 and 2016, the following stock options, which vest one year after grant date, were granted under the Company&#8217;s 2007 Plan:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Date of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Grant</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Employees</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Shares</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Option</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Expiration</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Date</b></p></td></tr> <tr style="vertical-align: bottom"> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 1%; text-align: center">&#160;</td> <td style="width: 21%; text-align: center"><font style="font-size: 10pt">1/4/17</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%; text-align: center">&#160;</td> <td style="width: 17%; text-align: center"><font style="font-size: 10pt">1</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 17%; text-align: right"><font style="font-size: 10pt">65,000</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 17%; text-align: right"><font style="font-size: 10pt">15.04</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 16%; text-align: center"><font style="font-size: 10pt">1/4/25</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">12/9/16</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">10</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">215,000</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">14.24</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">12/9/24</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1/5/16</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">65,000</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">10.37</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1/5/24</font></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: justify">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fiscal 2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fiscal 2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 66%; text-align: justify"><font style="font-size: 10pt">Dividend yield</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">4.44</font></td> <td style="width: 1%"><font style="font-size: 10pt">%</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">6.17</font></td> <td style="width: 1%"><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: justify"><font style="font-size: 10pt">Expected volatility</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">18.84</font></td> <td><font style="font-size: 10pt">%</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">20.20</font></td> <td><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: justify"><font style="font-size: 10pt">Risk-free interest rate</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">2.26</font></td> <td><font style="font-size: 10pt">%</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">2.09</font></td> <td><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: justify"><font style="font-size: 10pt">Expected lives (years)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">8</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">8</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: justify"><font style="font-size: 10pt">Estimated forfeitures</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The weighted-average fair value of options granted during the nine months ended June 30, 2017 and 2016 was $1.49 and $0.74 per option, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017 and 2016, no shares of restricted stock were granted and during the nine months ended June 30, 2016, one participant forfeited 3,232 shares of restricted stock under the 2007 Plan. During the nine months ended June 30, 2016, five participants exercised options awarded under the 2007 Plan to purchase an aggregate of 180,000 shares of common stock at a weighted average exercise price of $7.84 per share for total proceeds of $1,412,050. During the nine months ended June 30, 2017, no options were exercised. As of June 30, 2017, a total of 1,764,878 shares were available for grant as stock options, as restricted stock, or other equity based awards, plus any shares subject to outstanding options that expire or are forfeited without being exercised, and there were outstanding options to purchase 735,000 shares. The aggregate intrinsic value of options outstanding as of June 30, 2017 was $2,719,550.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Recent Accounting Pronouncements</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In January 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2017-01, &#8220;Business Combinations (Topic 805): Clarifying the Definition of a Business&#8221; (ASU 2017-01). ASU 2017-01 provides revised guidance to determine when an acquisition meets the definition of a business or should be accounted for as an asset acquisition, likely resulting in more acquisitions being accounted for as asset acquisitions as opposed to business combinations. Transaction costs are capitalized for asset acquisitions while they are expensed as incurred for business combinations. ASU 2017-01 requires that, when substantially all of the fair value of an acquisition is concentrated in a single identifiable asset or a group of similar identifiable assets, the asset or group of similar identifiable assets does not meet the definition of a business. ASU 2017-01 also revises the definition of a business to include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create an output. ASU 2017-01 will be effective, on a prospective basis, for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted. We adopted ASU 2017-01 prospectively as of April 1, 2017, as permitted under the standard. As a result of the implementation of this update, our property acquisitions, which under previous guidance were accounted for as business combinations, are now accounted for as acquisitions of assets. In an acquisition of assets, certain acquisition costs are capitalized as opposed to expensed under accounting for business combinations. For the period April 1, 2017 through June 30, 2017, the Company acquired five properties, for each of which it was concluded that substantially all of the fair value of the assets acquired with each property acquisition was concentrated in a single identifiable asset and did not meet the definition of a business combination under ASU 2017-01. Therefore, acquisition transaction costs associated with these property acquisitions were capitalized to real estate investments as part of the purchase price.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In August 2016, the FASB issued ASU 2016-15, &#8220;Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments&#8221;. ASU 2016-15 will make eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. ASU 2016-15 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In March 2016, the FASB issued ASU 2016-09 &#8220;Compensation &#8211; Stock Compensation: Improvements to Employee Share-Based Payment Accounting&#8221;, which relates to the accounting for employee share-based payments. ASU 2016-09 addresses several aspects of the accounting for share-based payment award transactions, including: (a) income tax consequences; (b) classification of awards as either equity or liabilities; and (c) classification on the statement of cash flows. This standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In February 2016, the FASB issued ASU 2016-02, &#8220;Leases&#8221;. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. ASU 2016-02 will be effective for annual reporting periods beginning after December 15, 2018. Early adoption is permitted. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements and the timing of adoption.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In January 2016, the FASB issued ASU 2016-01, &#8220;Financial Instruments &#8211; Overall: Recognition and Measurement of Financial Assets and Financial Liabilities&#8221;. ASU 2016-01 requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. These changes become effective for the Company&#8217;s fiscal year beginning October 1, 2018. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements and has not determined the effects of this update on the Company&#8217;s financial position, results of operations or cash flows and disclosures at this time.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In April 2015, the FASB issued ASU 2015-03, &#8220;Interest - Imputation of Interest (Topic 835): Simplifying the Presentation of Debt Issuance Costs&#8221;. ASU 2015-03 requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability. In August 2015, the FASB issued ASU 2015-15, &#8220;Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements&#8221; (Subtopic 835-30), which clarified that debt issuance costs related to line-of-credit arrangements may be presented as an asset and amortized over the term of the line-of-credit arrangement regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company adopted these standards effective October 1, 2016. As a result, debt issuance costs related to debt liabilities that are not line-of-credit arrangements are included as a direct deduction from the related debt liability and those related to line-of-credit arrangements continue to be included as an asset on the accompanying Consolidated Balance Sheets. The effects of this standard were applied retrospectively to all prior periods presented. The effect of the change in accounting principle was the reduction in the amount of $6,272,143 of the Fixed Rate Mortgage Notes Payable liability and a corresponding reduction of the Financing Costs asset as of September 30, 2016 and a reclassification of Amortization of Financing Costs of $240,463 and $713,501 for the three and nine months ended June 30, 2016, respectively to Interest Expense, net of Amortization of Financing Costs in our Consolidated Statement of Income.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">In May 2014, the FASB issued ASU 2014-09, &#8220;Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers&#8221;. The FASB issued further guidance in ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, that provides clarifying guidance in certain narrow areas and adds some practical expedients. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The effective date of ASU 2014-09 was extended by one year by ASU 2015-14, &#8220;Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date&#8221;. The new standard is effective for the first interim period within annual reporting periods beginning after December 15, 2017. Therefore, the Company expects to adopt the standard effective October 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method, and the Company is evaluating which transition method it will elect. The Company is also in the process of evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company does not expect the adoption of this standard to have a significant impact on its consolidated financial statements and related disclosures.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying Consolidated Financial Statements.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><u>Segment Reporting &#38; Financial Information</u></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The Company&#8217;s primary business is the ownership and management of real estate properties. The Company seeks to invest in well-located, modern, single-tenant, industrial buildings leased primarily to investment grade tenants or their subsidiaries on long-term net leases. The Company reviews operating and financial information for each property on an individual basis and, therefore, each property represents an individual operating segment. The Company evaluates financial performance using Net Operating Income (NOI) from property operations. NOI is defined as recurring Rental and Reimbursement Revenue, less Real Estate Taxes and Operating Expenses, such as insurance, utilities and repairs and maintenance. The Company has aggregated the properties into one reportable segment as the properties share similar long-term economic characteristics and have other similarities, including the fact that they are operated as industrial properties subject to long-term net leases primarily to investment grade tenants or their subsidiaries.</p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">During the nine months ended June 30, 2017 and 2016, the following stock options, which vest one year after grant date, were granted under the Company&#8217;s 2007 Plan:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Date of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Grant</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Employees</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Shares</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Option</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Price</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Expiration</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Date</b></p></td></tr> <tr style="vertical-align: bottom"> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 1%; text-align: center">&#160;</td> <td style="width: 21%; text-align: center"><font style="font-size: 10pt">1/4/17</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%; text-align: center">&#160;</td> <td style="width: 17%; text-align: center"><font style="font-size: 10pt">1</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 17%; text-align: right"><font style="font-size: 10pt">65,000</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 17%; text-align: right"><font style="font-size: 10pt">15.04</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 16%; text-align: center"><font style="font-size: 10pt">1/4/25</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">12/9/16</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">10</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">215,000</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">14.24</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">12/9/24</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1/5/16</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center">&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">65,000</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">10.37</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: center"><font style="font-size: 10pt">1/5/24</font></td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the fiscal year indicated:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: justify">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fiscal 2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fiscal 2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 66%; text-align: justify"><font style="font-size: 10pt">Dividend yield</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">4.44</font></td> <td style="width: 1%"><font style="font-size: 10pt">%</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">6.17</font></td> <td style="width: 1%"><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: justify"><font style="font-size: 10pt">Expected volatility</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">18.84</font></td> <td><font style="font-size: 10pt">%</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">20.20</font></td> <td><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: justify"><font style="font-size: 10pt">Risk-free interest rate</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">2.26</font></td> <td><font style="font-size: 10pt">%</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">2.09</font></td> <td><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: justify"><font style="font-size: 10pt">Expected lives (years)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">8</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">8</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: justify"><font style="font-size: 10pt">Estimated forfeitures</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">Consolidated Statements of Income for the three and nine months ended June 30, 2017 and 2016:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Three Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Nine Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%"><font style="font-size: 10pt">Rental and Reimbursement Revenue</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Real Estate Taxes</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(28,159</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(8,855</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(68,776</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Operating Expenses</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(32,022</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(9,846</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(52,363</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Depreciation &#38; Amortization</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(24,017</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(8,006</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(73,055</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Interest Expense</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Loss from Operations</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">-0-</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(84,198</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(26,707</font></td> <td><font style="font-size: 10pt">)</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">(194,194</font></td> <td><font style="font-size: 10pt">)</font></td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Loss on Sale of Real Estate Investment</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(95,336</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Net Loss</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(84,198</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(122,043</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(194,194</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Three Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Nine Months Ended</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%; text-align: justify"><font style="font-size: 10pt">Rental Revenue</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">26,224,800</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">26,973,500</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">78,455,200</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">78,995,500</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Net Income Attributable to Common Shareholders</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">5,160,600</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">7,865,900</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">15,261,700</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">16,596,200</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Basic and Diluted Net Income per Share Attributable to Common Shareholders</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.07</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.11</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.21</font></td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">0.23</font></td> <td>&#160;</td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The following is a summary of the securities that the Company has determined to be temporarily impaired as of June 30, 2017:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Less than 12 Months</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>12 Months or Longer</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td>&#160;</td> <td>&#160;</td> <td colspan="2">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center"><font style="font-size: 10pt"><b>Unrealized</b></font></td> <td>&#160;</td> <td>&#160;</td> <td colspan="2">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center"><font style="font-size: 10pt"><b>Unrealized</b></font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt"><b>Description of Securities</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fair Value</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Losses</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Fair Value</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Losses</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%"><font style="font-size: 10pt">Preferred stock</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">2,127,800</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">(52,587</font></td> <td style="width: 1%"><font style="font-size: 10pt">)</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Common stock</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">28,819,800</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(3,087,363</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Total</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">30,947,600</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(3,139,950</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">-0-</font></td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The following is a summary of the range of losses:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Number of</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Individual</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Securities</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Fair</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Value</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Unrealized</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Losses</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Range of </b></font><br /> <font style="font-size: 10pt"><b>Loss</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 1%">&#160;</td> <td style="width: 25%; text-align: center"><font style="font-size: 10pt">3</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 21%; text-align: right"><font style="font-size: 10pt">11,895,800</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 21%; text-align: right"><font style="font-size: 10pt">(567,137</font></td> <td style="width: 1%"><font style="font-size: 10pt">)</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 22%; text-align: center"><font style="font-size: 10pt">1%-5%</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">1</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">19,051,800</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(2,572,813</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: center"><font style="font-size: 10pt">12%</font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="border-bottom: black 2.25pt double">&#160;</td> <td style="border-bottom: black 2.25pt double; text-align: center"><font style="font-size: 10pt">4</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">30,947,600</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">(3,139,950</font></td> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The following is a summary of our Fixed Rate Mortgage Notes Payable as of June 30, 2017 and September 30, 2016:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>9/30/2016</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Amount</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted Average Interest</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Rate (1)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Amount</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid"> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Weighted Average Interest</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>Rate (1)</b></p></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%; padding-bottom: 1.5pt"><font style="font-size: 10pt">Fixed Rate Mortgage Notes Payable</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">561,736,464</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 10%; padding-bottom: 1.5pt; text-align: right"><font style="font-size: 10pt">4.21</font></td> <td style="width: 1%; padding-bottom: 1.5pt"><font style="font-size: 10pt">%</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="width: 10%; border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">483,748,153</font></td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 1%; padding-bottom: 1.5pt">&#160;</td> <td style="width: 10%; padding-bottom: 1.5pt; text-align: right"><font style="font-size: 10pt">4.48</font></td> <td style="width: 1%; padding-bottom: 1.5pt"><font style="font-size: 10pt">%</font></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">Debt Issuance Costs</font></td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">10,171,381</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td><font style="font-size: 10pt">$</font></td> <td style="text-align: right"><font style="font-size: 10pt">9,424,697</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Accumulated Amortization of Debt Issuance Costs</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(2,921,873</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid">&#160;</td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">(3,152,554</font></td> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">)</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 1.5pt"><font style="font-size: 10pt">Unamortized Debt Issuance Costs</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">7,249,508</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="border-bottom: black 1.5pt solid"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font-size: 10pt">6,272,143</font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="padding-bottom: 2.5pt"><font style="font-size: 10pt">Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">554,486,956</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="border-bottom: black 2.25pt double"><font style="font-size: 10pt">$</font></td> <td style="border-bottom: black 2.25pt double; text-align: right"><font style="font-size: 10pt">477,476,010</font></td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td> <td style="padding-bottom: 2.5pt; text-align: right">&#160;</td> <td style="padding-bottom: 2.5pt">&#160;</td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.75in; text-align: justify">&#160;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"></p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%"> <tr style="vertical-align: top"> <td style="width: 48px">&#160;</td> <td style="width: 24px"><font style="font-size: 10pt">(1)</font></td> <td style="text-align: justify"><font style="font-size: 10pt">Weighted average interest rate excludes amortization of debt issuance costs.</font></td></tr> </table> <p style="margin: 0pt"></p> Board of Directors approved a 6.7% increase in the Company’s quarterly common stock dividend, raising it to $0.16 per share from $0.15 per share. 0.067 0.06125 3000000 The Company also owns a portfolio of REIT investment securities which the Company generally limits to no more than approximately 10% of its undepreciated assets., (which is the Company’s total assets excluding accumulated depreciation). 24.50 6272143 74338101 2467165 0 0 2467165 -0.03 0 0 -0.03 -0.03 0 0 -0.03 41304256 40812783 Of the Company’s 105 properties, only four leases contain an early termination provision. The Company’s leases with early termination provisions are the 26,340 square foot location in Ridgeland (Jackson), MS, the 38,333 square foot location in Rockford, IL, the 83,000 square foot location in Roanoke, VA and the 102,135 square foot location in O’Fallon (St. Louis), MO. 1600000 3232 735000 2719550 4622836 Availability under the Facility is limited to 60% of the value of the borrowing base properties. The value of the borrowing base properties is determined by applying a 7.0% capitalization rate to the NOI generated by the Company’s unencumbered, wholly-owned industrial properties. Borrowings under the Facility, will, at the Company’s election, either i) bear interest at LIBOR plus 140 basis points to 220 basis points, depending on the Company’s leverage ratio, or ii) bear interest at BMO’s prime lending rate plus 40 basis points to 120 basis points, depending on the Company’s leverage ratio. The Company’s borrowings as of June 30, 2017, based on the Company's leverage ratio as of June 30, 2017, bear interest at LIBOR plus 150 basis points, which was at an interest rate of 2.54% as of June 30, 2017. 0.50 100000000 627867 25.44 P10Y P15Y P10Y7M6D 2661000 <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">The financial information set forth below summarizes the Company&#8217;s preliminary purchase price allocation for these five properties acquired during the three months ended June 30, 2017 that are accounted for as asset acquisitions:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 74%"><font style="font-size: 10pt">Land</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 23%; text-align: right"><font style="font-size: 10pt">16,915,800</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><font style="font-size: 10pt">Building</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">132,260,865</font></td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td><font style="font-size: 10pt">In-Place Leases</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">3,112,332</font></td> <td>&#160;</td></tr> </table> <p style="margin: 0pt"></p> <p style="margin: 0pt"></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">The following table summarizes the operating results included in the Company&#8217;s consolidated statements of income for the three and nine months ended June 30, 2017 for the properties acquired during the nine months ended June 30, 2017:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&#160;</p> <table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td>&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Three Months Ended 6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td> <td style="padding-bottom: 1.5pt">&#160;</td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt"><b>Nine Months Ended 6/30/2017</b></font></td> <td style="padding-bottom: 1.5pt">&#160;</td></tr> <tr style="vertical-align: bottom"> <td>&#160;</td> <td>&#160;</td> <td colspan="2">&#160;</td> <td>&#160;</td> <td>&#160;</td> <td colspan="2" style="text-align: center">&#160;</td> <td>&#160;</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 66%; padding-left: 5.4pt; text-align: justify"><font style="font-size: 10pt">Rental Revenues</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">1,712,249</font></td> <td style="width: 1%">&#160;</td> <td style="width: 1%">&#160;</td> <td style="width: 1%"><font style="font-size: 10pt">$</font></td> <td style="width: 14%; text-align: right"><font style="font-size: 10pt">3,234,951</font></td> <td style="width: 1%">&#160;</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 5.4pt"><font style="font-size: 10pt">Net Income Attributable to Common Shareholders</font></td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">598,783</font></td> <td>&#160;</td> <td>&#160;</td> <td>&#160;</td> <td style="text-align: right"><font style="font-size: 10pt">925,316</font></td> <td>&#160;</td></tr> </table> <p style="margin: 0pt"></p> 16915800 132260865 3112332 95336 0 0 0 1%-5% 12% 200000000 110000000 0.0205 34000000 2 36270 159588 0.020 3.56 3.88 0.332 0.134 -53493750 0 -57500000 0 4.40 171880 4.74 71003000 15628000 627867 25.44 15628000 237000 2898000 3135000 12094940 1712249 3234951 598783 925316 0000067625 0.06125 0.07875 0.07625 Weighted average interest rate excludes amortization of debt issuance costs.