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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 10-Q
 
þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
   
For the quarterly period ended March 31, 2005

OR
 
o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
   
For the transition period from __________ to __________

Commission File No. 001-13183

Roberts Realty Investors, Inc.
(Exact Name of Registrant as Specified in Its Charter)

Georgia
  
58-2122873
(State or other jurisdiction of
  
(I.R.S. Employer
incorporation or organization)
  
Identification Number)

450 Northridge Parkway, Suite 302, Atlanta, Georgia
  
30350
(Address of Principal Executive Offices)
  
(Zip Code)

Registrant’s telephone number, Including Area Code: (770) 394-6000
 
Indicate by check whether the registrant: (1) has filed all reports to be filed by Section 13 of 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 þ No o
 
Indicate by check whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ
 
The number of outstanding shares of the registrant’s Common Stock on May 6, 2005 was 5,321,207 (net of shares held in treasury).


TABLE OF CONTENTS

   
PAGE
     
PART I FINANCIAL INFORMATION
2
   
 
ITEM 1.
FINANCIAL STATEMENTS
2
     
ITEM 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
14
 
 
ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
28
 
 
 
ITEM 4.
CONTROLS AND PROCEDURES
29
     
PART II OTHER INFORMATION
30
     
ITEM 1.
LEGAL PROCEEDINGS
30
     
ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
30
 
 
ITEM 3.
DEFAULTS UPON SENIOR SECURITIES
30
     
ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
30
 
 
ITEM 5.
OTHER INFORMATION
30
     
ITEM 6.
EXHIBITS
30
 
___________________


PART I

ITEM 1. FINANCIAL STATEMENTS.
ROBERTS REALTY INVESTORS, INC.

CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)

   
March 31,
  
December 31,
  
   
2005
  
2004
  
   
(Unaudited)
      
           
ASSETS
          
           
REAL ESTATE ASSETS - At cost:
          
Land
  
$
9,109
  
$
9,109
  
Buildings and improvements
    
65,890
    
65,527
  
Furniture, fixtures and equipment
    
6,169
    
6,013
  
     
81,168
    
80,649
  
Less accumulated depreciation
    
(10,025
)
  
(9,157
)
Operating real estate assets
    
71,143
    
71,492
  
Construction in progress and real estate under development
    
44,318
    
28,272
  
               
Net real estate assets
    
115,461
    
99,764
  
               
CASH AND CASH EQUIVALENTS
    
8,741
    
27,552
  
               
RESTRICTED CASH
    
180
    
150
  
               
DEFERRED FINANCING COSTS - Net of accumulated amortization of $496 and $445 at March 31, 2005 and December 31, 2004, respectively
    
296
    
341
  
               
OTHER ASSETS - Net
    
1,426
    
1,422
  
   
$
126,104
  
$
129,229
  
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
              
               
LIABILITIES:
              
Mortgage notes payable
  
$
31,106
  
$
31,186
  
Construction notes payable
    
33,285
    
32,294
  
Land notes payable
    
6,842
    
9,462
  
Swap contract liability
    
167
    
436
  
Accounts payable and accrued expenses
    
1,005
    
671
  
Due to Roberts Construction (including retainage payable of $268 and $298 at March 31, 2005 and December 31, 2004, respectively)
    
268
    
653
  
Security deposits and prepaid rents
    
298
    
250
  
Liabilities related to sold assets
   
--
    
60
  
               
Total liabilities
    
72,971
    
75,012
  
               
COMMITMENTS AND CONTINGENCIES (Note 8)
             
               
MINORITY INTEREST OF UNITHOLDERS IN THE OPERATING PARTNERSHIP
    
13,930
    
14,368
  
               
SHAREHOLDERS’ EQUITY:
              
Preferred shares, $.01 par value, 20,000,000 shares authorized, no shares issued and outstanding
    
--
    
--
  
Common shares, $.01 par value, 100,000,000 shares authorized, 5,684,073 and 5,668,622 shares issued at March 31, 2005 and December 31, 2004, respectively
    
57
    
57
  
Additional paid-in capital
    
26,629
    
26,476
  
Less treasury shares, at cost (362,588 shares at March 31, 2005 and December 31, 2004)
    
(2,764
)
  
(2,764
)
Unamortized restricted stock compensation
    
(15
)
  
(18
)
Retained earnings
   
15,419
    
16,418
  
Accumulated other comprehensive loss
    
(123
)
  
(320
)
Total shareholders’ equity
    
39,203
    
39,849
  
   
$
126,104
  
$
129,229
  
               

See notes to the consolidated financial statements.


2

ROBERTS REALTY INVESTORS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands, Except Per Share Amounts)

   
Three Months Ended March 31,
  
   
2005 
  
2004 
  
   
(Unaudited)
  
(Unaudited)
  
           
OPERATING REVENUES:
          
Rental operations
  
$
1,707
  
$
1,198
  
Other operating income
    
105
    
31
  
Total operating revenues
    
1,812
    
1,229
  
               
OPERATING EXPENSES:
              
Personnel
    
250
    
126
  
Utilities
    
133
    
76
  
Repairs, maintenance and landscaping
    
109
    
62
  
Real estate taxes
    
206
    
109
  
Marketing, insurance and other
    
160
    
73
  
General and administrative expenses
    
405
    
394
  
Depreciation of real estate assets
    
886
    
403
  
Total operating expenses
    
2,149