11. SEGMENTS

The Company’s reportable segments consist of the four types of commercial real estate properties for which the Company’s decision-makers internally evaluate operating performance and financial results: Residential Properties, Industrial and Office Properties, Retail Properties; and Self-Storage Properties (sold on April 10, 2015). The Company also has certain corporate level activities including accounting, finance, legal administration and management information systems which are not considered separate operating segments. The accounting policies of the reportable segments are the same as those described in Note 2. There is no intersegment activity.

The Company evaluates the performance of its segments based upon net operating income (“NOI”), which is a non-GAAP supplemental financial measure. The Company defines NOI for its segments as operating revenues (rental income, tenant reimbursements and other operating income) less property and related expenses (property operating expenses, real estate taxes, insurance, asset management fees, impairments and provision for bad debt). NOI excludes certain items that are not considered to be controllable in connection with the management of an asset such as non-property income and expenses, depreciation and amortization, real estate acquisition fees and expenses and corporate general and administrative expenses. The Company uses NOI to evaluate the operating performance of the Company’s real estate investments and to make decisions about resource allocations.

The following tables reconcile the Company’s segment activity to its results of operations and financial position as of and for the three months ended March 31, 2016 and 2015.

	For the Three Months Ended March 31,
	2016			2015
Office/Industrial Properties:
Rental income	$	7,019,176		$	4,008,818
Property and related expenses		(2,232,590	)		(1,580,965	)
Net operating income, as defined		4,786,586			2,427,853
Residential Properties:
Rental income		388,400			357,903
Property and related expenses		(17,704	)		(11,238	)
Net operating income, as defined		370,696			346,665
Retail Properties:
Rental income		1,049,998			1,015,878
Property and related expenses		(223,057	)		(347,385	)
Net operating income, as defined		826,941			668,493
Self-Storage Properties (discontinued operations):
Rental income		-			892,977
Property and related expenses		-			(862,674	)
Net operating income, as defined		-			30,303
Reconciliation to net loss:
Total net operating income, as defined, for reportable segments		5,984,223			3,473,314
General and administrative expenses		(1,298,959	)		(1,154,801	)
Depreciation and amortization		(2,659,531	)		(1,861,546	)
Interest expense		(3,388,602	)		(2,379,592	)
Interest income		21,739			14,604
Gain on sale of real estate		175,486			78,496
Net loss	$	(1,165,644	)	$	(1,829,525	)

	March 31,		December 31,
Assets by Reportable Segment:	2016		2015

Office/Industrial Properties:
Land, buildings and improvements, net (1)	$	180,373,842	$	181,776,776
Total assets (2)	$	191,516,280	$	187,198,961
Residential Properties:
Land, buildings and improvements, net (1)	$	20,125,666	$	13,914,168
Total assets (2)	$	20,681,133	$	14,395,904
Retail Properties:
Land, buildings and improvements, net (1)	$	35,090,222	$	35,395,235
Total assets (2)	$	36,643,527	$	36,747,069
Reconciliation to Total Assets:
Total assets for reportable segments	$	248,840,940	$	238,341,934
Other unallocated assets:
Cash and cash equivalents		5,371,721		6,626,423
Other assets, net		3,056,188		9,306,036
Total Assets	$	257,268,849	$	254,274,393

(1) Includes lease intangibles and the land purchase option related to property acquisitions.

(2) Includes land, buildings and improvements, current receivables, deferred rent receivables and deferred leasing costs and other related intangible assets, all shown on a net basis.

Capital Expenditures by Reportable Segment
	For the Three Months Ended March 31,
	2016		2015
Office/Industrial Properties:
Capital expenditures and tenant improvements	$	748,800	$	1,118,854

Residential Properties:
Acquisition of operating properties		7,399,545		3,756,740

Retail Properties:
Capital expenditures and tenant improvements		1,192		41,333

Self-Storage Properties (real estate held for sale):
Capital expenditures and tenant improvements		-		6,250

Totals:
Acquisition of operating properties, net		7,399,545		3,756,740
Capital expenditures and tenant improvements		749,992		1,166,437
Total real estate investments	$	8,149,537	$	4,923,177