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<SEC-DOCUMENT>0000950123-10-026911.txt : 20100507
<SEC-HEADER>0000950123-10-026911.hdr.sgml : 20100507
<ACCEPTANCE-DATETIME>20100322174719
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0000950123-10-026911
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20100322

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			AMERICAN REALTY INVESTORS INC
		CENTRAL INDEX KEY:			0001102238
		STANDARD INDUSTRIAL CLASSIFICATION:	REAL ESTATE OPERATORS (NO DEVELOPERS) & LESSORS [6510]
		IRS NUMBER:				752847135
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		1800 VALLEY VIEW LANE
		STREET 2:		SUITE 300
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75234
		BUSINESS PHONE:		4695224200

	MAIL ADDRESS:	
		STREET 1:		1800 VALLEY VIEW LANE
		STREET 2:		SUITE 300
		CITY:			DALLAS
		STATE:			TX
		ZIP:			75234
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="center" style="font-size: 14pt; margin-top: 18pt">METZGER &#038; McDONALD PLLC
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: pt"><FONT style="font-variant: SMALL-CAPS">A PROFESSIONAL LIMITED LIABILITY COMPANY</FONT><BR>
<FONT style="font-variant: SMALL-CAPS">ATTORNEYS, MEDIATORS &#038; COUNSELORS</FONT>
</DIV>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
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<TR valign="bottom">
    <TD width="30%"></TD>
    <TD width="5%"></TD>
    <TD width="37%"></TD>
    <TD width="5%"></TD>
    <TD width="20%"></TD>
    <TD width="1%"></TD>
    <TD width="30%"></TD>
</TR>

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<TR valign="bottom"><!-- Blank Space -->
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="left" valign="top"><FONT style="font-variant: SMALL-CAPS">Steven C. Metzger</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT style="font-variant: SMALL-CAPS">3626 N. Hall Street, Suite&nbsp;800</FONT></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="left" valign="top"><FONT style="font-variant: SMALL-CAPS">Direct Dial 214-740-5030</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT style="font-variant: SMALL-CAPS">Dallas, Texas 75219-5133</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top"><FONT style="font-variant: SMALL-CAPS">Facsimile</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top" nowrap><FONT style="font-variant: SMALL-CAPS">214-224-7555</FONT></TD>
</TR>
<TR valign="bottom">
    <TD align="left" valign="top"><FONT style="font-variant: SMALL-CAPS">smetzger@pmklaw.com</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><FONT style="font-variant: SMALL-CAPS">214-969-7600</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top"><FONT style="font-variant: SMALL-CAPS">214-523-3838</FONT></TD>
</TR>
<TR valign="bottom">
    <TD align="left" valign="top">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><u><FONT style="font-variant: SMALL-CAPS">www.pmklaw.com</FONT></u>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top"><FONT style="font-variant: SMALL-CAPS">214-969-7635</FONT></TD>
</TR>
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</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt">March&nbsp;19, 2010
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B><I>Via EDGAR</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The Securities and Exchange Commission<BR>
100 F Street, N.E., Mail Stop 3010<BR>
Washington, D.C. 20549

</DIV>

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<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">Attn:</TD>
    <TD>&nbsp;</TD>
    <TD>Cicely LaMothe, Branch Chief<br>
Jorge L. Bonilla, Staff Accountant</TD>
</TR>
</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="2%" style="background: transparent">&nbsp;</TD>
    <TD width="3%" nowrap align="left">Re:&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>American Realty Investors, Inc. (Commission File No.
001-15663; CIK No.&nbsp;0001102238) &#151; Form&nbsp;10-K for the fiscal year ended
December&nbsp;31, 2008, Forms 10-Q for the quarters ended March&nbsp;31, 2009,
June&nbsp;30, 2009 and September&nbsp;30, 2009</TD>
</TR>

</TABLE>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Ladies and Gentlemen:
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On behalf of American Realty Investors, Inc., a Nevada corporation
(&#147;ARL&#148;) this letter is being filed as correspondence uploaded on the
EDGAR system on behalf of ARL in response to a letter of comment from the Staff of
the Securities and Exchange Commission dated March&nbsp;4, 2010. Schedule&nbsp;1 annexed to
this letter contains the response to the comments of the Staff. In each instance on
such Schedule, for convenience, each comment of the Staff is repeated, followed in
each instance by the applicable response to such comment or explanation. Also
included in such response, where appropriate, is a letter/page reference to the text
to the applicable document or instrument referred to in the comment.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This letter is being filed under the EDGAR system in direct response to the
comments of the Staff. If you would like to discuss any item concerning the
referenced matter included in this letter or Schedule&nbsp;1, please do not hesitate to
contact the undersigned at any time at 214-740-5030 direct or Gene S. Bertcher,
Executive Vice President and Chief Financial Officer of ARL at 469-522-4238 direct.
</DIV>
<DIV align="left" style="font-size: 10pt; margin-left: 66%; margin-top: 12pt">Very truly yours,
</DIV>

<DIV align="left" style="font-size: 10pt; margin-left: 66%; margin-top: 12pt">/s/ Steven C. Metzger
</DIV>
<DIV align="right"><DIV style="font-size: 3pt; margin-top: 2pt; width: 34%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>


<DIV align="left" style="font-size: 10pt; margin-left: 66%; margin-top: 0pt">Steven C. Metzger
</DIV>


<DIV align="left" style="margin-top: 12pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD></TD>
</TR>
<TR valign="top">
    <TD nowrap align="left">cc:</TD>
    <TD>&nbsp;</TD>
    <TD>Gene S. Bertcher<br>
Executive Vice President and Chief Financial Officer<br>
American Realty Investors, Inc.<br>
1800 Valley View Lane, Suite&nbsp;300<br>
Dallas, Texas 75234</TD>
</TR>
</TABLE>
</DIV>

<DIV style="margin-top: 6pt">
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</DIV>
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="margin-top: 6pt"><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SCHEDULE 1</B>
</DIV>


<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>Response to Comments of the Staff of<BR>
The Securities and Exchange Commission<BR>
by letter dated March&nbsp;4, 2010 with respect to<BR>
Form 10-K for the fiscal year ended December&nbsp;31, 2008 and<BR>
Forms 10-Q for the quarters ended March&nbsp;31, 2009,<BR>
June&nbsp;30, 2009 and September&nbsp;30, 2009 of<BR>
American Realty Investors, Inc.<BR>
Commission File No.&nbsp;001-15663</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><DIV align="center"><DIV style="font-size: 3pt; margin-top: 16pt; width: 26%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following information is to provide a response to comments of the Staff of the Securities
and Exchange Commission rendered by letter dated March&nbsp;4, 2010 with respect to Form 10-K Annual
Report to the Securities and Exchange Commission for the fiscal year ended December&nbsp;31, 2008 of
American Realty Investors, Inc. (the &#147;Company&#148; or
&#147;ARL&#148;) as well as Forms
10-Q for the quarters ended March&nbsp;31, 2009, June&nbsp;30, 2009 and September&nbsp;30, 2009 of the Company.
For convenience, each comment of the Staff is restated below, with our response noted immediately
following the comment. Also included in such response is a letter/page reference to the text of
each instrument where applicable.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Form&nbsp;10-Q for the Period Ended September&nbsp;30, 2009</B></U>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Financial Statements</B></U>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><U><B>Note 1 Organization and Basis of Presentation, page 8</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Comment/Observation No.&nbsp;1. </B>We have considered your response to comment 10 relating
to your accounting for your acquisition of IOT. Please confirm that you will revise your
disclosure in future filings to clarify that the fair value of
IOT&#146;s assets and liabilities
at the acquisition date approximated IOT&#146;s book value, as represented in your response to us.

</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Response to Comment/Observation No.&nbsp;1. </B>The Company will provide the requested disclosure in
future filings.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><U><B>Note 9 Impairment Investments and Real Estate Assets, page 15</B></U>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Comment/Observation No.&nbsp;2. </B>We have considered your response to comment 11 relating to your
presentation of provision for impairment losses below operating income. Please explain to us how
you considered SAB 99 in determining that the effect of your presentation is not quantitatively and
qualitatively material to the financial statements.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Response to Comment/Observation No.&nbsp;2. </B>With respect to the quantitative and
qualitative materiality aspect discussed in Staff Accounting Bulletin No.&nbsp;99 (SAB 99) related to
the Company&#146;s presentation of its provision for impairment
losses, the Company believes that the dollar  value of the

</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">impairment loss from a quantitative perspective is not as important as the
qualitative factors when determining if a restatement of past filings is needed for simply a
reclassification from other income/expense to property operations. From a qualitative analysis
standpoint using the factors listed in SAB 99 we determined the following. The misclassification
does not mask a change in earnings as it does not affect total earnings. It does not hide any
failure to meet any analysts&#146; expectations as we do not believe there to be any significant
analysts&#146; expectations and net earnings is not affected by this. This misclassification does
not change a loss to income or vice versa. We do not believe this misclassification to have
altered any evaluation of the Company&#146;s performance or profitability with concern to a
segment or other portion of the Company&#146;s operations nor to the Company&#146;s
performance/profitability as a whole. This misclassification does not affect compliance with any
regulatory requirements that we are aware of, nor any loan covenants or other contractual
requirements. Also, this misclassification does not have any affect on management&#146;s
compensation nor does it conceal any unlawful transaction. Based on our conclusions after
consideration of these factors, we believe that this misclassification does not rise to the level
requiring amendments and resubmission of historical filings. We do agree, as conveyed in our
previous response letter, that in all future filings the historical statements should be
reformatted or revised to show the proper presentation. We respectfully request that the Company
<U>not</U> be required to amend previous filings to change this misclassification as upon
submission of the Company&#146;s 2009 Form 10-K, all current required financial information will
have the provision for impairment losses presented correctly. In addition, as mentioned in our
initial response, all future Forms 10-Q will present the provision for impairment losses correctly.
</DIV>



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