brt-20210331

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2021

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission File Number 001-07172

BRT APARTMENTS CORP.

(Exact name of Registrant as specified in its charter)


Maryland						13-2755856
(State or other jurisdiction of						(I.R.S. Employer Identification No.)
incorporation or organization)


60 Cutter Mill Road, Great Neck, NY						11021
(Address of principal executive offices)						(Zip Code)

516-466-3100

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	BRT	NYSE

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Date File required to be submitted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of “large accelerated filer” “accelerated filer”, “smaller reporting company”and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer ☐						Accelerated filer ☐
Non-accelerated filer ☒						Smaller reporting company ☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of stock, as of the latest practicable date.

17,582,975 Shares of Common Stock,

par value $0.01 per share, outstanding on May 6, 2021

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BRT APARTMENTS CORP. AND SUBSIDIARIES

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Part I - Financial Information		Page No.
Item 1.	Financial Statements
	Consolidated Balance Sheets - Consolidated Balance Sheets - March 31, 2021 (unaudited) and December 31, 20 20 (audited)	3
	Consolidated Statements of Operations – Three months ended March 31 , 202 1 and 20 20 (unaudited)	4
	Consolidated Statements of Comprehensive Income (loss) – Three months ended March 31, 2021 and 2020 (unaudited)	5
	Consolidated Statements of Equity – Three months ended March 31, 202 1 and 202 0 (unaudited)	6
	Consolidated Statements of Cash Flows – Three months en ded March 31, 20 2 1 and 20 20 (unaudited)	7
	Notes to Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures About Market Risks	30

Item 4.	Controls and Procedures	30

Part II – Other Information

Item 1A.	Risk Factors	31

Item 5.	Other Information	32

Item 6.	Exhibits	32

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Explanatory Note

Unless otherwise indicated or the context otherwise requires, all references to (i) “us”, “we”, “BRT” or the “Company” refer to BRT Apartments Corp. and its consolidated and unconsolidated subsidiaries; (ii) all interest rates give effect to the related interest rate derivative, if any; (iii) "acquisitions" include investments in and by unconsolidated joint ventures; (iv) units under rehabilitation for which we have received or accrued rental income from business interruption insurance, while not physically occupied, are treated as leased (i.e., occupied) at rental rates in effect at the time of the casualty, and (v) "same store properties" refer to properties that we owned and operated for the entirety of both periods being compared, except for properties that are under construction, in lease-up, or are undergoing development or redevelopment. We move properties previously excluded from our same store portfolio (because they were under construction, in lease up or are in development or redevelopment) into the same store designation once they have stabilized (as described below) and such status has been reflected fully in all quarters during the applicable periods of comparison. Newly constructed, lease-up, development and redevelopment properties are deemed stabilized upon the earlier to occur of the first full calendar quarter beginning (a) 12 months after the property is fully completed and put in service and (b) attainment of at least 90% physical occupancy.

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Part I ‑ FINANCIAL INFORMATION

Item 1. Financial Statements

BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except per share data)


	March 31, 2021		December 31, 2020
	(unaudited)		(audited)
ASSETS
Real estate properties, net of accumulated depreciation and amortization of $30,777 and $30,837	$	142,078	$	160,192
Investments in unconsolidated joint ventures	164,248		169,474

Cash and cash equivalents	19,406		19,885
Restricted cash	8,511		8,800
Other assets	6,910		7,390
Real estate property held for sale	16,800		—
Total Assets	$	357,953	$	365,741
LIABILITIES AND EQUITY
Liabilities:
Mortgages payable, net of deferred costs of $498 and $563	$	129,698	$	130,434
Junior subordinated notes, net of deferred costs of $312 and $317	37,088		37,083

Accounts payable and accrued liabilities	20,678		20,536
Total Liabilities	187,464		188,053

Commitments and contingencies
Equity:
BRT Apartments Corp. stockholders' equity:
Preferred shares $.01 par value 2,000 shares authorized, none outstanding	—		—
Common stock, $.01 par value, 300,000 shares authorized; 16,820 and 16,432 shares outstanding	168		164
Additional paid-in capital	246,139		245,605
Accumulated other comprehensive loss	(15)		(19)
Accumulated deficit	(75,754)		(67,978)
Total BRT Apartments Corp. stockholders’ equity	170,538		177,772
Non-controlling interests	(49)		(84)
Total Equity	170,489		177,688
Total Liabilities and Equity	$	357,953	$	365,741

See accompanying notes to consolidated financial statements.

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BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(Dollars in thousands, except per share data)


	Three Months Ended March 31,
	2021		2020
Revenues:
Rental and other revenue from real estate properties	$	7,095	$	6,745
Other income	4		179
Total revenues	7,099		6,924
Expenses:
Real estate operating expenses - including $7 and $8 to related parties	3,117		3,058
Interest expense	1,660		1,860
General and administrative - including $172 and $226 to related parties	3,114		3,367

Depreciation	1,537		1,561
Total expenses	9,428		9,846
Total revenues less total expenses	(2,329)		(2,922)
Equity in loss of unconsolidated joint ventures	(1,345)		(1,815)



Loss from continuing operations	(3,674)		(4,737)
Income tax provision	57		62
Net loss from continuing operations, net of taxes	(3,731)		(4,799)
Net income attributable to non-controlling interests	(34)		(32)
Net loss attributable to common stockholders	$	(3,765)	$	(4,831)

Weighted average number of shares of common stock outstanding:
Basic	17,319,222		16,932,252
Diluted	17,319,222		16,932,252

Per share amounts attributable to common stockholders:
Basic	$	(0.22)	$	(0.29)
Diluted	$	(0.22)	$	(0.29)

See accompanying notes to consolidated financial statements.

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BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

(Dollars in thousands)


	Three Months Ended March 31,

	2021		2020
Net (loss)	$	(3,731)	$	(4,799)
Other comprehensive loss:
Unrealized income (loss) on derivative instruments	5		(23)
Other comprehensive income (loss)	5		(23)
Comprehensive loss	(3,726)		(4,822)
Comprehensive (income)loss attributable to non-controlling interests	(35)		(29)
Comprehensive loss attributable to common stockholders	$	(3,761)	$	(4,851)

See accompanying notes to consolidated financial statements.

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BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

(Dollars in thousands, except per share data)


	Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive (Loss) income		Accumulated Deficit		Non- Controlling Interest		Total
Balances, December 31, 2020	$	164	$	245,605	$	(19)	$	(67,978)	$	(84)	$	177,688
Distributions - common stock - $0.22 per share	—		—		—		(4,011)		—		(4,011)
Restricted stock and restricted stock units vesting	4		(4)		—		—		—		—
Compensation expense - restricted stock and restricted stock units	—		538		—		—		—		538




Net (loss) income	—		—		—		(3,765)		34		(3,731)
Other comprehensive income	—		—		4		—		1		5
Comprehensive loss											(3,726)
Balances, March 31, 2021	$	168	$	246,139	$	(15)	$	(75,754)	$	(49)	$	170,489


	Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive (Loss) income		Accumulated Deficit		Non- Controlling Interest		Total
Balances, December 31, 2019	$	156	$	232,331	$	(10)	$	(32,824)	$	(93)	$	199,560
Distributions - common stock - $0.22 per share	—		—		—		(3,822)		—		(3,822)
Restricted stock vesting	1		(1)		—		—		—		—
Compensation expense - restricted stock and restricted stock units	—		438		—		—		—		438
Distributions to non-controlling interests	—		—		—		—		(89)		(89)
Shares issued through equity offering program, net	7		12,070		—		—		—		12,077
Shares repurchased	—		(616)								(616)
Net (loss) income	—		—		—		(4,831)		32		(4,799)
Other comprehensive loss	—		—		(20)		—		(3)		(23)
Comprehensive loss											(4,822)
Balances, March 31, 2020	$	164	$	244,222	$	(30)	$	(41,477)	$	(153)	$	202,726

See accompanying notes to consolidated financial statements

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BRT APARTMENTS CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in Thousands)


	Three Months Ended March 31,
	2021		2020
Cash flows from operating activities:
Net loss	$	(3,731)	$	(4,799)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation	1,537		1,561
Amortization of deferred financing costs	80		70
Amortization of restricted stock and restricted stock units	538		438
Equity in loss of unconsolidated joint ventures	1,345		1,815





Increases and decreases from changes in other assets and liabilities:


Decrease (increase) in other assets	470		(331)
Increase in accounts payable and accrued liabilities	(87)		1,803
Net cash provided by operating activities	152		557

Cash flows from investing activities:
Collections from real estate loan	—		150

Improvements to real estate properties	(223)		(323)


Distributions from unconsolidated joint ventures	3,881		3,010

Contributions to unconsolidated joint ventures	—		(13,700)
Net cash provided by (used in) investing activities	3,658		(10,863)

Cash flows from financing activities:


Mortgage principal payments	(801)		(756)



Dividends paid	(3,777)		(3,778)

Distributions to non-controlling interests	—		(89)
Proceeds from the sale of common stock	—		12,077
Repurchase of shares of common stock	—		(616)
Net cash (used in) provided by financing activities	(4,578)		6,838

Net decrease in cash, cash equivalents and restricted cash	(768)		(3,468)
Cash, cash equivalents and restricted cash at beginning of period	28,685		32,418
Cash, cash equivalents and restricted cash at end of period	$	27,917	$	28,950

Supplemental disclosure of cash flow information:

SEC Form 10-Q filed by BRT Apartments Corp.