Urstadt Biddle Properties Inc. Annual Report 2008

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FY2008 Annual Report · Urstadt Biddle Properties Inc.

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39 Consecutive Years of Uninterrupted Dividends
15 Consecutive Years of Increased Dividends

2008 Annual Report

Veteran’s Plaza, New Milford, Connecticut

STOCK PRICES ARE ONLY OPINIONS.
BUT DIVIDENDS ARE FACTS.

(In Millions) Except Dividends

Revenues

Funds From Operations

Common & Class A
Dividends Paid

$90

$80

$70

$60

$50

$40

$30

$20

$10

’99

’00

’01

’02

’03

’04

’05

’06

’07

’08

URSTADT BIDDLE
PR O P E R T I E S I N C .

Urstadt Biddle Properties Inc. is a self-administered publicly

held real estate investment trust providing investors with a

means of participating in the ownership of income-producing

properties. Our core properties consist of neighborhood and

community shopping centers in the suburban areas of the

northeastern United States with a primary concentration

in Fairfield County, Connecticut, Westchester and Putnam

Counties, New York and Bergen County, New Jersey.
Non-core assets consist of two industrial properties.

Class A Common Shares, Common Shares, Series C Preferred

Shares and Series D Preferred Shares of the Company trade
on the New York Stock Exchange under the symbols “UBA,”
“UBP,” “UBPPRC” and “UBPPRD.”

2008 ANNUAL REPORT CONTENTS

Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Letter to Our Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . .2

Map of Core Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Investment Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Financials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

Directors and Officers . . . . . . . . . . . . . . .Back Cover

SELECTED FINANCIAL DATA
(In thousands, except per share data)

Year Ended October 31,

2008

2007

2006

2005

2004

Balance Sheet Data:
Total Assets
Mortgage Notes Payable
Redeemable Preferred Stock

Operating Data:
Total Revenues
Total Expenses and Minority Interest
Income from Continuing Operations
before Discontinued Operations

Per Share Data:
Net Income from Continuing

Operations—Basic:

Class A Common Stock
Common Stock

Net Income from Continuing

Operations—Diluted:

Class A Common Stock
Common Stock
Cash Dividends on:

Class A Common Stock
Common Stock

Total

Other Data:
Net Cash Flow Provided by (Used in):

Operating Activities
Investing Activities
Financing Activities

Funds from Operations (Note)
Common and Class A Dividends

$506,117
$104,954
$ 96,203

$471,770
$ 96,282
$ 52,747

$451,350
$104,341
$ 52,747

$464,439
$ 111,786
$ 52,747

$394,917
$107,443
$ 52,747

$ 80,856
$ 52,649

$ 81,880*
$ 49,630

$ 72,302
$ 48,708

$ 68,371
$ 46,134

$ 60,650
$ 39,729

$ 28,525

$ 32,751

$ 24,544

$ 22,968

$ 21,408

$ .66
$ .60

$ .64
$ .58

$ .95
$ .86
$1.81

$ .95
$ .86

$ .93
$ .83

$ .92
$ .83
$1.75

$ .63
$ .56

$ .61
$ .55

$ .90
$ .81
$1.71

$ .66
$ .60

$ .64
$ .58

$ .88
$ .80
$1.68

$ .69
$ .63

$ .68
$ .62

$ .86
$ .78
$1.64

$ 44,997
$(33,694)
$(13,857)

$ 49,307
$ (19,457)
$ (28,432)

$ 35,429
$ (20,129)
$ (38,994)

$ 35,505
$ (61,348)
$ 26,397

$ 30,744
$ (2,416)
$ (24,837)

$ 30,444

$ 37,062*

$ 28,848

$ 29,355

$ 29,813

(as a percentage of Funds from Operations)

80%

64%

80%

76%

72%

Note: The Company has adopted the definition of Funds from Operations (FFO) suggested by the National Association of Real Estate Investment Trusts (NAREIT) and defines FFO as net income
(computed in accordance with generally accepted accounting principles), excluding gains (or losses) from sales of properties plus real estate related depreciation and amortization and after
adjustments for unconsolidated joint ventures. For a reconciliation of net income and FFO, see Management’s Discussion and Analysis of Financial Conditions and Results of Operations on
page 27. FFO does not represent cash flows from operating activities in accordance with generally accepted accounting principles and should not be considered an alternative to net income as
an indicator of the Company’s operating performance. The Company considers FFO a meaningful, additional measure of operating performance because it primarily excludes the assumption
that the value of its real estate assets diminishes predictably over time and industry analysts have accepted it as a performance measure. FFO is presented to assist investors in analyzing the
performance of the Company. It is helpful as it excludes various items included in net income that are not indicative of the Company’s operating performance. However, comparison of the
Company’s presentation of FFO, using the NAREIT definition, to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of
the NAREIT definition used by such REITs. For a further discussion of FFO, see Management’s Discussion and Analysis of Financial Conditions and Results of Operations on page 27.

Total Revenues
(In thousands)

*
0
8
8
,
1
8
$

6
5
8
,
0
8
$

2
0
3
,
2
7
$

1
7
3
,
8
6
$

0
5
6
,
0
6
$

Funds From Operations
(In thousands)

*
2
6
0
,
7
3
$

4
4
4
,
0
3
$

3
1
8
,
9
2
$

5
5
3
,
9
2
$

8
4
8
,
8
2
$

Combined Dividends
Paid on Common and
Class A Common Shares
(Per share)

4
6
.
1
$

8
6
.
1
$

1
7
.
1
$

1
8
.
1
$

5
7
.
1
$

’04

’05

’06

’07

’08

’04

’05

’06

’07

’08

’04

’05

’06

’07

’08

*Includes $6 million settlement of lease guarantee obligation.

LETTER TO OUR STOCKHOLDERS

Arcadian Shopping Center
Ossining, New York

Ferry Plaza
Newark, New Jersey

The U.S. economy is facing challenges not previously

experienced during our lifetimes. The Board of

Directors and senior management of UBP have managed

In 2008, we leased or renewed 303,000 square feet of space

or 9% of our core portfolio of properties, and we invested

a substantial portion of the proceeds from our successful

your Company in a way designed to endure through

$60 million preferred stock offering in income-producing

times like these and to enable us to take advantage of

real estate, including the purchase of two grocery-anchored

buying opportunities when they arise. Having been

neighborhood shopping centers in our target market.

through down cycles before, we know the risks of leverage

in development. We have always said, “Stock Prices are

In 2008, revenues increased nearly 4% to an all-time high of

Only Opinions—but Dividends are Facts,” and have

$80.9 million, when excluding the effect of the receipt, in

managed the Company in a way that emphasizes steady,

fiscal 2007, of a $6 million lease guarantee settlement for a

conservative growth. It is this philosophy that has enabled

former tenant at The Dock shopping center. Funds from

us to increase dividends, even during economic

Operations declined one cent per share in 2008. Our FFO

downturns. The graph on page 40 of this report illustrates

was negatively affected by approximately three cents per

investors’ opinion of our strategy. While many publicly

share as a result of a charge of $660,000 caused by the

traded real estate companies have seen their market values

redemption of our Series B Preferred Stock during fiscal

recently cut in half, as of December 31, 2008 our total

2008. Most importantly, we have managed our balance

return to stockholders had a positive increase over the

sheet to ensure that we have ample resources to meet

prior 12 months and our stock has been among the

future capital needs. Only 11 of the Company’s 44

country’s best performing REIT stocks for the prior 1, 3

properties are mortgaged and we believe that the limited

and 5-year periods.

debt maturing in the next year can be easily refinanced or

In 2008, we leased or renewed
303,000 square feet of space or
9% of our core portfolio of
properties, and we invested a
substantial portion of the
proceeds from our successful
$60 million preferred stock
offering in income-producing
real estate.

Veteran’s Plaza
New Milford, Connecticut

repaid from our working capital or available lines of

we have entered into leases at the property to bring

credit. This year we sold $60 million of perpetual

occupancy to 100%. The second, Ferry Plaza, is

preferred stock and entered into confirmed credit facilities

a 101,000 square foot shopping center located in the

totaling $80 million with two of the country’s strongest

IronBound section of Newark, NJ, a solid blue collar

banks, The Bank of New York Mellon and Wells Fargo

community. The property is anchored by a strong 63,000

Bank N.A., to provide ample resources to carry out our

square foot Pathmark supermarket (now a division of

strategic goals for 2009 and 2010 in the event that the

A&P) and is 100% leased. We also purchased a single

equity and mortgage markets are unavailable.

tenant property in Waldwick, NJ that is net leased to Rite

2009 may prove to be a challenging year due to the extreme

working on a potential redevelopment of the Waldwick

stress that retailers are under; however, we believe your

property. Additionally, we purchased a package of two

Company is well positioned to weather the storm and

single-building properties in Westchester County,

to capitalize on opportunities to buy properties that

formerly occupied as Chase Manhattan bank branches. We

downturns in real estate cycles historically have created.

entered into this purchase to gain control of one property

Aid, a national chain of pharmacy stores. We are presently

Property Acquisitions

We acquired two shopping centers this year. The first,

that is adjacent to our Chilmark Shopping Center. We are

presently in contract to sell the non-adjacent property.

Veteran’s Plaza, is a 79,000 square foot shopping center

The difficulties presently experienced by many real estate

located in New Milford, CT, with a successful 51,000

investors due to the tightening of credit, coupled with the

square foot Big Y supermarket anchor. Since the closing,

effects on retailers by the drop in consumer spending,

Westchester Pavilion
White Plains, New York

The Westchester County Board of Realtors, Inc located in
the Westchester Pavilion, White Plains, New York

should cause shopping centers to be valued at higher yields

by several of our tenants including KB Toys, Hancock

in 2009. As we have stated in prior reports, we have been

Fabrics and Bombay Furniture, and downsizing by other

cautious in acquiring properties over the past few years

tenants such as Borders Books. During 2008, we filled our

because we felt that prices for properties generally were

largest vacancy with the opening of a 107,000 square foot

too high. We expect that 2009 will see a change in seller

BJ’s Warehouse Club at The Dock Shopping Center in

expectations and we believe we will be well positioned to

Stratford, CT. At the Arcadian Shopping Center in

acquire good properties in our target markets. We will

Ossining, NY, our anchor grocer Stop & Shop reopened for

continue to remain disciplined and look to buy properties

business in November in its brand new 65,000 square foot

that over the long term will contribute substantially to the

store. Also during the year, at the Westchester Pavilion in

cash flow and net asset value of the Company.

White Plains, NY, the Westchester County Board of

Realtors opened for business in a new 16,000 square foot

Leasing and Operations

expansion of the facility.

This year, base rental revenues increased by 6.5%. The

increase reflects favorable rental increases on new leases

Outlook

and renewals of existing tenant leases and recent property

We expect 2009 to be a difficult year for leasing. Presently,

acquisitions, offset partially by a slight decline in

the extreme slowdown in consumer spending and the lack

occupancy rates. In 2008, we achieved an average rent

of credit or equity available to retailers are causing many

increase of 23% on 97,000 square feet of new leases and

retailers to put the development of new stores on hold and

an average rent increase of 5% on 206,000 square feet of

to focus on surviving the current economic downturn.

renewal leases for existing tenants. The leased portion of

However, our properties are of high quality and well

our core portfolio fell by 1.8% to 94.5% at year end. The

located in stable, upper-income communities and generally

decline in occupancy was the result of bankruptcy filings

provide essential consumer goods and services. We expect

In 2008, we were the only publicly traded
shopping center REIT that produced a
positive total return (dividend plus stock
appreciation) to investors. Furthermore,
we returned the third highest total return
in 2008 among all 124 publicly traded
REITs in all property type sectors. Only
12 of 124 publicly traded REITs produced
a positive total return in 2008.

The Dock Shopping Center
Stratford, Connecticut

that when the economy improves and demand for store

Chief Investment Officer of The Bank of New York, joined

space returns, our vacancies will be among the first to

our Board of Directors. We welcome the added depth of

lease. Fortunately, we do not expect to be distracted by

experience and understanding of the economy that Kevin

liquidity concerns during 2009 as are some of our

brings to our Board. We also extend our thanks and best

competitors. Since we believe we have the resources for

wishes to George M. (“Morry”) Hubbard, Jr., Director

acquisitions, we are hopeful 2009 will be a good year.

Emeritus, one of the founding trustees of our predecessor,

Hubbard Real Estate Investments, as Morry looks forward

In December 2008, your Board of Directors increased the

to a June celebration of his 100th birthday.

annualized dividend rate on both the Common and the

Class A Common Stock by one cent per share. The 2009

We appreciate the efforts of our highly capable staff

increase in the dividend rates represents the 15th consecutive

and our supportive Board of Directors. We thank them

year that your Board of Directors has approved an increase.

and you our fellow shareholders for your continued

We are proud that we have had a 39-year unbroken string of

confidence and support.

dividend payments and that your Company has the financial

strength to enable the Board to increase the dividend in a year

in which over 25% of other REITs have cut their dividends.

The directors’ decision to increase the rates this year reflects

their confidence that the Company will weather the economic

difficulties our country is experiencing.

Sincerely yours,

Willing L. Biddle
President and
Chief Operating Officer

Charles J. Urstadt
Chairman and
Chief Executive Officer

Earlier this year, we were pleased to announce that

Kevin J. Bannon, former Executive Vice President and

January 15, 2009

Selected Core Properties

M A S S A C H U S E T T S

1 Urstadt Biddle Properties Corporate Headquarters

Greenwich, Connecticut

C O N N E C T I C U T

N E W Y O R K

N E W
J E R S E Y

L O N G

I S L A N D

530 Old Post Road
Greenwich, Connecticut

7 Riversville Road
Greenwich, Connecticut

25 Valley Drive
Greenwich, Connecticut

Ridgeway Shopping Center
Stamford, Connecticut

Goodwives
Darien, Connecticut

Greens Farms Plaza
Westport, Connecticut

Ridgefield Center
Ridgefield, Connecticut

Airport Plaza
Danbury, Connecticut

Danbury Square
Danbury, Connecticut

Veteran’s Plaza
New Milford, Connecticut

Starbucks Center
Monroe, Connecticut

The Dock
Stratford, Connecticut

Orange Meadows Shopping
Center, Orange, Connecticut

Townline Square
Meriden, Connecticut

Carmel ShopRite Center
Carmel, New York

Towne Centre Shopping
Center, Somers, New York

Somers Commons
Somers, New York

Heritage 202 Center
Somers, New York

Staples Plaza
Yorktown Heights, New York

Arcadian Shopping Center
Ossining, New York

Chilmark Shopping Center
Briarcliff Manor, New York

Chase Bank
Briarcliff Manor, New York

Westchester Pavilion
White Plains, New York

4 “Street Retail” Properties
Rye, New York

Shoppes at Eastchester
Eastchester, New York

Gristede’s Center
Pelham Manor, New York

72nd & Main Street Shops
Queens, New York

Rite Aid Center
Waldwick, New Jersey

Emerson Shopping Plaza
Emerson, New Jersey

Valley Ridge Shopping Center
Wayne, New Jersey

Ferry Plaza
Newark, New Jersey

Five Town Plaza
Springfield, Massachusetts

INVESTMENT PORTFOLIO
(As of January 15, 2008)

URSTADT BIDDLE PROPERTIES INC.

CORE PROPERTIES
UBP owns or has interests in forty-four retail properties and five office buildings which total 3,265,000 square feet.

Location

Square Feet

Principal Tenants

Property Type

Stamford, Connecticut
Springfield, Massachusetts
Meriden, Connecticut
Stratford, Connecticut
Yorktown, New York
Danbury, Connecticut
White Plains, New York
Ossining, New York
Somers, New York
Carmel, New York
Wayne, New Jersey
Newington, New Hampshire
Newark, New Jersey
Darien, Connecticut
Emerson, New Jersey
New Milford, Connecticut
Somers, New York
Orange, Connecticut
Eastchester, New York
Ridgefield, Connecticut
Rye, New York
Westport, Connecticut
Briarcliff Manor, New York
Danbury, Connecticut
Ossining, New York
Pelham Manor, New York
Queens, New York
Waldwick, New Jersey
Somers, New York
Monroe, Connecticut
Bank Branches, New York
Greenwich, Connecticut

369,000
326,000
316,000
269,000
200,000
194,000
185,000
137,000
135,000
129,000
102,000
102,000
101,000
95,000
92,000
79,000
78,000
78,000
70,000
51,000
40,000
39,000
38,000
33,000
29,000
26,000
24,000
20,000
19,000
10,000
6,000
59,000

Stop & Shop, Bed Bath & Beyond
Big Y, Burlington Coat, Best Fitness
ShopRite, Old Navy
BJ’s Wholesale Club, Stop & Shop, Staples
Staples, Bed Bath & Beyond
Barnes & Noble, Christmas Tree Shops
Toys “ “ Us, The Sports Authority
Stop & Shop, Mandees
Home Goods, New York Sports Club
ShopRite, Rite Aid
A&P, PNC Bank
Outback Steakhouse
Pathmark
Shaw’s Supermarket
ShopRite
Big Y Supermarket
CVS, US Post Office
Trader Joe’s, LL Bean
Food Emporium
Chico’s
Cosi
Pier One Imports
Dress Barn, Radio Shack
Fortunoff, Sleepy’s
Westchester Community College
Gristede’s Supermarket
Huntington Dental
Rite Aid
Putnam County Savings Bank
Starbucks
Vacant
Little Friends,
Urstadt Biddle Properties
(Executive Offices)

Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Street retail
Street retail (4 buildings)
Shopping center
Shopping center
Shopping center
Shopping center
Shopping center
Street retail (2 buildings)
Retail—Single tenant
Shopping center
Shopping center
Retail (2 buildings)
5 Office buildings

NON-CORE PROPERTIES
UBP owns two industrial properties with a total of 447,000 square feet.

Location

Square Feet

Principal Tenant

Property Type

Dallas, Texas
St. Louis, Missouri

255,000
192,000

DaimlerChrysler
DaimlerChrysler

Parts distribution facility
Parts distribution facility

URSTADT BIDDLE PROPERTIES INC.

FINANCIALS

CONTENTS

Consolidated Balance Sheets at October 31, 2008 and 2007 . . . . . . . . . . . . . . . 10

Consolidated Statements of Income for each of the

three years in the period ended October 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . 11

Consolidated Statements of Cash Flows for each of the

three years in the period ended October 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . 12

Consolidated Statements of Stockholders’ Equity

for each of the three years in the period
ended October 31, 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . 26

Management’s Discussion and Analysis of Financial

Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Management’s Report on Internal Control

over Financial Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Report of Independent Registered Public Accounting Firm

on Internal Control over Financial Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

Tax Status and Market Price Ranges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Performance Graph and Certifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)

ASSETS

Real Estate Investments:

Core properties—at cost
Non-core properties—at cost

Less: Accumulated depreciation

Mortgage note receivable

Cash and cash equivalents
Restricted cash
Marketable securities
Tenant receivables
Prepaid expenses and other assets
Deferred charges, net of accumulated amortization

Total Assets

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:

Unsecured revolving credit line
Secured revolving credit line
Mortgage notes payable
Accounts payable and accrued expenses
Deferred compensation—officers
Other liabilities

Total Liabilities

Minority interests

Redeemable Preferred Stock, par value $.01 per share;
issued and outstanding 2,800,000 and 550,000 shares

Commitments and Contingencies

Stockholders’ Equity:

7.5% Series D Senior Cumulative Preferred Stock (liquidation preference

of $25 per share); 2,450,000 shares issued and outstanding

Excess Stock, par value $.01 per share; 10,000,000 shares authorized;

none issued and outstanding

Common Stock, par value $.01 per share; 30,000,000 shares authorized;

7,990,120 and 7,773,618 shares issued and outstanding

Class A Common Stock, par value $.01 per share; 40,000,000 shares authorized;

18,208,118 and 18,836,778 shares issued and outstanding

Additional paid in capital
Cumulative distributions in excess of net income
Accumulated other comprehensive income (loss)
Officer note receivable

Total Stockholders’ Equity

Total Liabilities and Stockholders’ Equity

The accompanying notes to consolidated financial statements are an integral part of these statements.

October 31,

2008

2007

$566,889
1,383
568,272
(94,328)
473,944
1,241
475,185

1,664
519
897
17,782
5,603
4,467
$506,117

5,100
—
104,954
606
1,074
8,513
120,247

$521,476
1,383
522,859
(85,555)
437,304
1,305
438,609

4,218
589
1,740
16,588
5,445
4,581
$471,770

—
12,200
96,282
3,970
1,191
7,438
121,081

9,370

3,739

96,203

52,747

61,250

—

183
258,235
(39,181)
(270)
—
280,297
$506,117

—

188
264,585
(31,077)
480
(1,300)
294,203
$471,770

CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)

Revenues

Base rents
Recoveries from tenants
Settlement of lease guarantee obligation
Lease termination income
Mortgage interest and other

Total Revenues

Operating Expenses
Property operating
Property taxes
Depreciation and amortization
General and administrative
Directors’ fees and expenses
Total Operating Expenses

Operating Income
Non-Operating Income (Expense):

Interest expense
Interest, dividends and other investment income

Minority Interests
Income from Continuing Operations before Discontinued Operations
Discontinued Operations:

Income from discontinued operations
Gains on sales of properties

Income from Discontinued Operations

Net Income

Preferred stock dividends
Redemption of Preferred Stock

URSTADT BIDDLE PROPERTIES INC.

Year Ended October 31,
2007

2008

2006

$ 61,008
18,938
—
61
849
80,856

12,937
12,059
14,374
5,853
256
45,479

35,377

(7,012)
318
(158)
28,525

—
—
—

28,525
(11,718)
(660)

$57,260
17,660
6,000
115
845
81,880

12,109
10,926
13,442
4,979
240
41,696

40,184

(7,773)
501
(161)
32,751

252
11,385
11,637

44,388
(9,342)
—

$54,862
16,957
—
75
408
72,302

11,666
10,262
13,073
4,981
250
40,232

32,070

(8,287)
950
(189)
24,544

488
—
488

25,032
(9,342)
—

Net Income Applicable to Common and Class A Common Stockholders

$ 16,147

$35,046

$15,690

Basic Earnings Per Share:
Per Common Share:

Income from continuing operations
Income from discontinued operations
Net Income Applicable to Common Stockholders

Per Class A Common Share:

Income from continuing operations
Income from discontinued operations
Net Income Applicable to Class A Common Stockholders

Diluted Earnings Per Share:
Per Common Share:

Income from continuing operations
Income from discontinued operations
Net Income Applicable to Common Stockholders

Per Class A Common Share:

Income from continuing operations
Income from discontinued operations
Net Income Applicable to Class A Common Stockholders

Dividends Per Share:

Common
Class A Common

The accompanying notes to consolidated financial statements are an integral part of these statements.

$.60
$ —
$.60

$.66
$ —
$.66

$.58
$ —
$.58

$.64
$ —
$.64

$.86
$.95

$ .86
$ .43
$1.29

$ .95
$ .47
$1.42

$ .83
$ .42
$1.25

$ .93
$ .46
$1.39

$ .83
$ .92

$.56
$.02
$.58

$.63
$.02
$.65

$.55
$.02
$.57

$.61
$.02
$.63

$.81
$.90

FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

Cash Flows from Operating Activities:
Net income
Adjustments to reconcile net income to net cash provided

by operating activities:

Depreciation and amortization from continuing operations
Depreciation and amortization from discontinued operations
Straight-line rent adjustments
Provision for tenant credit losses
Restricted stock compensation expense
Change in value of deferred compensation arrangement
Gains on sale of properties
Gain on repayment of mortgage note receivable
Minority interests
Changes in operating assets and liabilities:

Tenant receivables
Accounts payable and accrued expenses
Other assets and other liabilities, net
Restricted cash

Net Cash Flow Provided by Operating Activities

Cash Flows from Investing Activities:

Acquisitions of real estate investments
Acquisition of limited partner interests in consolidated joint venture
Deposit on acquisitions of real estate investment
Improvements to properties and deferred charges
Net proceeds from sales of properties
Distributions to limited partners of consolidated joint ventures
Payments received on mortgage notes receivable
Redemption of marketable securities—net
Refund of escrow funds

Net Cash Flow (Used in) Investing Activities

Cash Flows from Financing Activities:

Net proceeds from issuance of Series E Preferred stock
Redemption of Series B Preferred Stock
Proceeds from revolving credit line borrowings
Repayments on revolving credit line borrowings
Sales of additional shares of Common and Class A Common Stock
Principal repayments on mortgage notes payable
Repayment of officer note receivable
Dividends paid—Common and Class A Common Stock
Dividends paid—Preferred Stock
Repurchase of shares of Class A Common Stock

Net Cash Flow (Used in) Financing Activities

Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year

Year Ended October 31,
2007

2008

2006

$ 28,525

$ 44,388

$ 25,032

14,374
—
(738)
749
1,713
(116)
—
—
158

(1,204)
(187)
1,654
69
44,997

(23,893)
—
(1,100)
(8,691)
—
(158)
63
85
—
(33,694)

57,972
(15,000)
18,100
(25,200)
943
(6,994)
1,300
(24,251)
(11,718)
(9,009)
(13,857)

(2,554)
4,218

13,442
40
(889)
539
2,071
(9)
(11,385)
—
161

896
(1,170)
1,223
—
49,307

(21,314)
(2,849)
(424)
(8,098)
13,200
(161)
56
133
—
(19,457)

—
—
14,200
(2,000)
809
(8,059)
—
(23,723)
(9,342)
(317)
(28,432)

1,418
2,800

13,073
170
(1,227)
200
2,007
71
—
(102)
189

(1,707)
(2,391)
116
(2)
35,429

(16,628)
—
—
(5,251)
—
(189)
765
561
613
(20,129)

—
—
3,000
(3,000)
876
(7,445)
—
(23,083)
(9,342)
—
(38,994)

(23,694)
26,494

Cash and Cash Equivalents at End of Year

$ 1,664

$ 4,218

$ 2,800

The accompanying notes to consolidated financial statements are an integral part of these statements.

URSTADT BIDDLE PROPERTIES INC.

Cumulative
Additional Distributions

Paid In
Capital Net Income
$(35,007)

Other
In Excess of Comprehensive
Income
$499

$267,365

Unamortized
Restricted
Stock
Accumulated Compensation
and Officer
Note
Receivable

Total
Stock–
holders’
Equity
$(9,521) $284,847

—

(8,221)

—

8,221

—

15,690

—

(6,168)
(16,915)

—
—
—
—
(42,400)

35,046

—

(6,435)
(17,288)

—
—
—
—
—
—
(31,077)

16,147

—

(6,848)
(17,403)

—
—
—
—
—
—
—
$(39,181)

—

119

—
—

—
—
—
—
618

—

(138)

—
—

—
—
—
—
—
—
480

—

(750)

—
—

—
—
—
—
—
—
—
$(270)

— 15,690

—

119
15,809

— (6,168)
— (16,915)

—
—
—
—

769
107
—
2,007
(1,300) 280,456

— 35,046

—

(138)
34,908

— (6,435)
— (17,288)

—
—
—
—
—
—

790
17
1
2,071
(317)
—
(1,300) 294,203

— 16,147

—

(750)
15,397

— (6,848)
— (17,403)

908
—
36
—
—
—
—
1,713
— (9,009)
—
—
1,300
1,300
$ — $280,297

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands, except shares and per share data)

7.5% Series D
Preferred Stock
Issued Amount

Common Stock
Issued Amount

Class A
Common Stock

Issued Amount
$187

Balances—October 31, 2005
Reversal of unamortized stock

compensation upon adoption
of SFAS No. 123R
Comprehensive Income:

Net income applicable to Common

and Class A common stockholders

Change in unrealized gains in

marketable securities

Total comprehensive income
Cash dividends paid:

Common stock ($0.81 per share)
Class A common stock ($0.90 per share)

Issuance of shares under dividend

reinvestment plan
Exercise of stock options
Shares issued under restricted stock plan
Restricted stock compensation
Balances—October 31, 2006
Comprehensive Income:

Net income applicable to Common

and Class A common stockholders

Change in unrealized gains in

marketable securities

Total comprehensive income
Cash dividends paid:

Common stock ($0.83 per share)
Class A common stock ($0.92 per share)

Issuance of shares under dividend

reinvestment plan
Exercise of stock options
Shares issued under restricted stock plan
Restricted stock compensation
Repurchases of Class A common stock
Forfeiture of restricted stock
Balances—October 31, 2007
Comprehensive Income:

Net income applicable to Common

and Class A common stockholders

Change in unrealized gains in

marketable securities

Total comprehensive income
Cash dividends paid:

Common stock ($0.86 per share)
Class A common stock ($0.95 per share)

Issuance of shares under dividend

2,450,000 $61,250 7,429,331

$ 74 18,705,800

—

—
—

—

—
—

—

—
—

—

—
—

—

—
—

—
—
—
—
2,450,000

— 30,810
—
9,500
— 165,800
—
—
61,250 7,635,441

—
15,431
—
4,500
2
79,050
—
—
76 18,804,781

—

—
—

—

—
—

—

—
—

—

—
—

—

—
—

—
—
—
—
—
—
2,450,000

— 32,377
—
—
— 105,800
—
—
—
—
—
—
61,250 7,773,618

12,444
—
1,953
—
70,300
1
—
—
— (21,200)
— (31,500)
77 18,836,778

—

—
—

—

—
—

—

—
—

—

—
—

—

—
—

—

—
—

—
—
1
—
188

—

—
—

—
—
—
—
—
—
188

—

—
—

—

—
—

769
107
(3)
2,007
262,024

—

—
—

790
17
—
2,071
(317)
—
264,585

—

—
—

—
—
—
—
—
—
—

— 43,636
—
1,966
— 170,900
—
—
—
—
—
—
—
—
2,450,000 $61,250 7,990,120

14,765
1
1,953
—
59,900
2
—
—
— (623,278)
— (82,000)
—
—
$80 18,208,118

—
—
1
—
(6)
—
—
$183

907
36
(3)
1,713
(9,003)
—
—
$258,235

The accompanying notes to consolidated financial statements are an integral part of these statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) ORGANIZATION, BASIS OF PRESENTATION

AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES

Business

Urstadt Biddle Properties Inc. (“Company”), a real estate

investment trust (“REIT”), is engaged in the acquisition,
ownership and management of commercial real estate,
primarily neighborhood and community shopping centers
in the northeastern part of the United States. The Company’s
major tenants include supermarket chains and other retailers
who sell basic necessities. At October 31, 2008, the Company
owned or had interests in 44 properties containing a total of
3.9 million square feet of gross leasable area (GLA).

Principles of Consolidation and Use of Estimates

The accompanying consolidated financial statements
include the accounts of the Company, its wholly owned
subsidiaries, and joint ventures in which the Company
meets certain criteria of a sole general partner in accordance
with Emerging Issues Task Force (“EITF”) Issue 04-5,
“Determining Whether a General Partner, or the General
Partners as a Group, Controls a Limited Partnership or
Similar Entity When the Limited Partners Have Certain
Rights.” The Company has determined that such joint
ventures should be consolidated into the consolidated
financial statements of the Company. All significant
intercompany transactions and balances have been
eliminated in consolidation.

The accompanying financial statements are prepared on
the accrual basis in accordance with accounting principles
generally accepted in the United States (“GAAP”). The
preparation of financial statements in conformity with
GAAP requires management to make estimates and
assumptions that affect the disclosure of contingent assets
and liabilities, the reported amounts of assets and liabilities
at the date of the financial statements, and the reported
amounts of revenue and expenses during the periods
covered by the financial statements. The most significant
assumptions and estimates related to the valuation of real
estate, depreciable lives, revenue recognition and the
collectibility of tenant and notes receivable. Actual results
could differ from these estimates.

Federal Income Taxes

The Company has elected to be treated as a REIT under
Sections 856-860 of the Internal Revenue Code (“Code”).
Under those sections, a REIT that, among other things,
distributes at least 90% of real estate trust taxable income and
meets certain other qualifications prescribed by the Code will
not be taxed on that portion of its taxable income that is
distributed. The Company believes it qualifies as a REIT and
has distributed all of its taxable income for the fiscal years
through 2008 in accordance with the provisions of the Code.
Accordingly, no provision has been made for federal income
taxes in the accompanying consolidated financial statements.

In June 2006, the FASB issued Interpretation No. 48,

“Accounting for Uncertainty in Income Taxes—an
interpretation of SFAS No. 109” (“FIN 48”), that defines a
recognition threshold and measurement attributable for the
financial statement recognition and measurement of a tax
position taken or expected to be taken in a tax return. FIN 48
also provides guidance on derecognition, classification,
interest and penalties, accounting in interim periods,
disclosure, and transition. The Company adopted FIN 48 as
of November 1, 2007. Based on its evaluation, the Company
determined that it has no uncertain tax positions and no
unrecognized tax benefits as of the adoption date or as of
October 31, 2008. As such, the adoption of FIN 48 did not
have any effect on the Company’s financial condition or
results of operations. The Company records interest and
penalties relating to unrecognized tax benefits, if any, as
interest expense. As of October 31, 2008, the tax years 2004
through and including 2008 remain open to examination by
the Internal Revenue Service. There are currently no federal
tax examinations in progress.

Real Estate Investments

All capitalizable costs related to the improvement or

replacement of real estate properties are capitalized.
Additions, renovations and improvements that enhance
and/or extend the useful life of a property are also
capitalized. Expenditures for ordinary maintenance,
repairs and improvements that do not materially prolong
the normal useful life of an asset are charged to operations
as incurred.

Upon the acquisition of real estate properties, the fair value

of the real estate purchased is allocated to the acquired
tangible assets (consisting of land, buildings and building
improvements), and identified intangible assets and liabilities
(consisting of above-market and below-market leases and in-
place leases), in accordance with SFAS No. 141, “Business
Combinations.” The Company utilizes methods similar to
those used by independent appraisers in estimating the fair
value of acquired assets and liabilities. The fair value of the
tangible assets of an acquired property considers the value of
the property “as-if-vacant.” The fair value reflects the
depreciated replacement cost of the asset. In allocating
purchase price to identified intangible assets and liabilities of
an acquired property, the value of above-market and below-
market leases are estimated based on the differences between
(i) contractual rentals and the estimated market rents over the
applicable lease term discounted back to the date of
acquisition utilizing a discount rate adjusted for the credit risk
associated with the respective tenants and (ii) the estimated
cost of acquiring such leases giving effect to the Company’s
history of providing tenant improvements and paying leasing
commissions, offset by a vacancy period during which such
space would be leased. The aggregate value of in-place leases
is measured by the excess of (i) the purchase price paid for a
property after adjusting existing in-place leases to market
rental rates over (ii) the estimated fair value of the property
“as-if-vacant,” determined as set forth above.

Above and below-market leases acquired are recorded at
their fair value. The capitalized above-market lease values
are amortized as a reduction of rental revenue over the
remaining term of the respective leases and the capitalized
below-market lease values are amortized as an increase to
rental revenue over the remaining term of the respective
leases. The value of in-place leases is based on the
Company’s evaluation of the specific characteristics of
each tenant’s lease. Factors considered include estimates of
carrying costs during expected lease-up periods, current
market conditions, and costs to execute similar leases. The
value of in-place leases are amortized over the remaining
term of the respective leases. If a tenant vacates its space
prior to its contractual expiration date, any unamortized
balance of their related intangible asset is recorded in the
consolidated statement of income.

Depreciation and Amortization

The Company uses the straight-line method for
depreciation and amortization. Core and non-core
properties are depreciated over the estimated useful lives
of the properties, which range from 30 to 40 years. Property
improvements are depreciated over the estimated useful
lives that range from 10 to 20 years. Furniture and fixtures
are depreciated over the estimated useful lives that range
from 3 to 10 years. Tenant improvements are amortized over
the shorter of the life of the related leases or their useful life.

Property Held for Sale

The Company has adopted the provisions of Statement of

Financial Accounting Standards No. 144, “Accounting for
the Impairment or Disposal of Long-Lived Assets” (“SFAS
No. 144”). SFAS No. 144 requires, among other things, that
the assets and liabilities and the results of operations of the
Company’s properties that have been sold or otherwise
qualify as held for sale be classified as discontinued
operations and presented separately in the Company’s
consolidated financial statements. If significant to financial
statement presentation, the Company classifies properties
as held for sale that are under contract for sale and are
expected to be sold within the next 12 months.

Deferred Charges

Deferred charges consist principally of leasing commissions
(which are amortized ratably over the life of the tenant leases)
and financing fees (which are amortized over the terms of
the respective agreements). Deferred charges in the
accompanying consolidated balance sheets are shown at cost,
net of accumulated amortization of $3,001,000 and $2,708,000
as of October 31, 2008 and 2007, respectively.

Asset Impairment

The Company reviews long-lived assets for impairment
whenever events or changes in circumstances indicate that
the carrying amount of an asset may not be recoverable.
Recoverability of assets to be held and used is measured

URSTADT BIDDLE PROPERTIES INC.

by a comparison of the carrying amount of the asset to
aggregate future net cash flows (undiscounted and without
interest) expected to be generated by the asset. If such assets
are considered impaired, the impairment to be recognized is
measured by the amount by which the carrying amounts of
the assets exceed the fair value.

Revenue Recognition

Revenues from operating leases include revenues from
core properties and non-core properties. Rental income is
generally recognized based on the terms of leases entered
into with tenants. In those instances in which the Company
funds tenant improvements and the improvements are
deemed to be owned by the Company, revenue recognition
will commence when the improvements are substantially
completed and possession or control of the space is turned
over to the tenant. When the Company determines that the
tenant allowances are lease incentives, the Company
commences revenue recognition when possession or control
of the space is turned over to the tenant for tenant work to
begin. Minimum rental income from leases with scheduled
rent increases is recognized on a straight-line basis over the
lease term. At October 31, 2008 and 2007, approximately
$10,817,000 and $10,078,000, respectively, has been recognized
as straight-line rents receivable (representing the current
net cumulative rents recognized prior to when billed and
collectible as provided by the terms of the leases), all of
which is included in tenant receivables in the accompanying
consolidated financial statements. Percentage rent is
recognized when a specific tenant’s sales breakpoint is
achieved. Property operating expense recoveries from tenants
of common area maintenance, real estate taxes and other
recoverable costs are recognized in the period the related
expenses are incurred. Lease incentives are amortized as a
reduction of rental revenue over the respective tenant lease
terms. Lease termination amounts received by the Company
from its tenants are recognized as income in the period
received. Interest income is recognized as it is earned. Gains
or losses on disposition of properties are recorded when the
criteria for recognizing such gains or losses under generally
accepted accounting principles have been met.

The Company provides an allowance for doubtful

accounts against the portion of tenant receivables
(including an allowance for future tenant credit losses of
approximately 10% of the deferred straight-line rents
receivable) which is estimated to be uncollectible. Such
allowances are reviewed periodically. At October 31, 2008
and 2007, tenant receivables in the accompanying
consolidated balance sheets are shown net of allowances
for doubtful accounts of $2,177,000 and $1,946,000,
respectively. During the years ended October 31, 2008,
2007 and 2006, the Company provided $749,000, $539,000
and $200,000, respectively, for uncollectible amounts,
which is recorded in the accompanying consolidated
statement of income as a reduction of base rental revenue.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Cash Equivalents

Cash and cash equivalents consist of cash in banks and short-term investments with original maturities of less than

three months.

Restricted Cash

Restricted cash consists of those tenant security deposits and replacement and other reserves required by agreement with

certain of the Company’s mortgage lenders for property level capital requirements that are required to be held in separate
bank accounts.

Marketable Securities

Marketable securities consist of short-term investments and marketable equity securities. Short-term investments (consisting

of investments with original maturities of greater than three months when purchased) and marketable equity securities are
carried at fair value. The Company has classified marketable securities as available for sale. Unrealized gains and (losses) on
available for sale securities are recorded as other comprehensive income (loss) in stockholders’ equity. For the year ended
October 31, 2006, gains on sales of marketable securities, determined based on specific identification, amounted to $122,000
(none in fiscal 2008 and 2007).

As of October 31, 2008, all of the Company’s marketable securities consisted of REIT Common and Preferred Stocks. At
October 31, 2008, the Company has recorded a net unrealized loss on available for sale securities in the amount of $270,000.
The Company deems this loss to be temporary. If and when the Company deems the unrealized losses to be other than
temporary, unrealized losses will be realized and reclassified into earnings. The net unrealized loss at October 31, 2008
is detailed below (In thousands):

Description:
REIT Common and Preferred Stocks

Fair
Market
Value
$897

Cost
Basis
$1,167

Net

Gross
Unrealized Unrealized
Gains
$169

Gain/(Loss)
$(270)

Gross
Unrealized
(Loss)
$(439)

Period securities have
been in loss position
Less than 12 months

Comprehensive Income

Comprehensive income is comprised of net income and
other comprehensive income (loss). Other comprehensive
income (loss) includes items that are otherwise recorded
directly in stockholders’ equity, such as unrealized gains
or losses on marketable securities. At October 31, 2008 and
2007, other comprehensive income (loss) consists of net
unrealized gains (losses) of $(270,000) and of $480,000,
respectively. Unrealized gains and losses included in other
comprehensive income will be reclassified into earnings
as gains and losses are realized.

respectively. The estimated fair value of mortgage notes
payable is based on discounting the future cash flows at a
year-end risk adjusted borrowing rate currently available
to the Company for issuance of debt with similar terms
and remaining maturities.

Although management is not aware of any factors
that would significantly affect the estimated fair value
amounts, such amounts have not been comprehensively
revalued for purposes of these financial statements since
that date and current estimates of fair value may differ
significantly from the amounts presented herein.

Fair Value of Financial Instruments

Concentration of Credit Risk

The carrying values of cash and cash equivalents,

Financial instruments that potentially subject the

restricted cash, tenant receivables, prepaid expenses and
other assets, accounts payable, accrued expenses and other
liabilities are reasonable estimates of their fair values
because of the short-term nature of these instruments.

The estimated fair value of mortgage notes receivable
collateralized by real property is based on discounting the
future cash flows at a year-end risk adjusted lending rate
that the Company would utilize for loans of similar risk
and duration. At October 31, 2008 and 2007, the estimated
aggregate fair value of the mortgage notes receivable was
$814,000 and $959,000, respectively.

The estimated fair value of mortgage notes payable was
$102,440,000 and $94,780,000 at October 31, 2008 and 2007,

Company to concentrations of credit risk consist primarily
of cash and cash equivalents, and tenant receivables. The
Company places its cash and cash equivalents in excess of
insured amounts with high quality financial institutions.
The Company performs ongoing credit evaluations of its
tenants and may require certain tenants to provide security
deposits or letters of credit. Though these security deposits
and letters of credit are insufficient to meet the terminal
value of a tenant’s lease obligation, they are a measure of
good faith and a source of funds to offset the economic
costs associated with lost rent and the costs associated with
retenanting the space. There is no dependence upon any
single tenant.

Earnings Per Share

Stock-Based Compensation

The Company calculates basic and diluted earnings per

The Company accounts for its stock-based compensation

URSTADT BIDDLE PROPERTIES INC.

share in accordance with SFAS No. 128, “Earnings Per
Share.” Basic earnings per share (“EPS”) excludes the
impact of dilutive shares and is computed by dividing
net income applicable to Common and Class A Common
stockholders by the weighted average number of Common
shares and Class A Common shares outstanding for the
period. Diluted EPS reflects the potential dilution that
could occur if securities or other contracts to issue
Common shares or Class A Common shares were exercised
or converted into Common shares or Class A Common
shares and then shared in the earnings of the Company.
Since the cash dividends declared on the Company’s Class
A Common stock are higher than the dividends declared
on the Common Stock, basic and diluted EPS have been
calculated using the “two-class” method. The two-class
method is an earnings allocation formula that determines
earnings per share for each class of common stock
according to the weighted average of the dividends
declared, outstanding shares per class and participation
rights in undistributed earnings.

The following table sets forth the reconciliation between

basic and diluted EPS (in thousands):

Year Ended October 31,
2008

2007

2006

Numerator
Net income applicable to

common stockholders—basic

Effect of dilutive securities:

Stock awards and operating

partnership units
Net income applicable to

$ 4,162

$ 8,800

$ 3,871

125

324

220

common stockholders—diluted

$ 4,287

$ 9,124

$ 4,091

Denominator
Denominator for basic EPS—

weighted average common shares

6,990

6,845

6,662

Effect of dilutive securities:

Restricted stock and other awards
Operating partnership units
Denominator for diluted EPS—
weighted average common
equivalent shares

Numerator
Net income applicable to Class A
common stockholders—basic

Effect of dilutive securities:

Stock awards and operating

partnership units

Net income applicable to Class A
common stockholders—diluted

Denominator
Denominator for basic EPS—
weighted average Class A
common shares

Effect of dilutive securities:

Restricted stock and other awards
Operating partnership units
Denominator for diluted EPS—
weighted average Class A
common equivalent shares

361
—

448
—

482
55

7,351

7,293

7,199

$11,985

$26,246

$11,819

(125)

(324)

—

$11,860

$25,922

$11,819

18,223

18,419

18,312

185
—

275
—

306
55

18,408

18,694

18,673

plans under FASB Statement No. 123R, “Share-Based
Payment” (“SFAS No. 123R”), which requires that
compensation expense be recognized based on the fair
value of the stock awards less estimated forfeitures. The
fair value of stock awards is equal to the fair value of the
Company’s stock on the grant date.

Segment Reporting

The Company operates in one industry segment,

ownership of commercial real estate properties which are
located principally in the northeastern United States. The
Company does not distinguish its property operations for
purposes of measuring performance. Accordingly, the
Company believes it has a single reportable segment for
disclosure purposes.

Recently Issued Accounting Pronouncements

In December 2007, the FASB issued SFAS No. 160,
“Noncontrolling Interests in Consolidated Financial
Statements,” which, among other things, provides
guidance and establishes amended accounting and
reporting standards for a parent company’s
noncontrolling interest in a subsidiary. The Company is
currently evaluating the impact of adopting the statement,
which is effective for fiscal years beginning on or after
December 15, 2008.

In December 2007, the FASB issued SFAS No. 141R,
“Business Combinations” (“SFAS No. 141R”), which
replaces SFAS No. 141, “Business Combinations.” SFAS
No. 141R, among other things, establishes principles and
requirements for how an acquirer entity recognizes and
measures in its financial statements the identifiable assets
acquired, the liabilities assumed (including intangibles)
and any noncontrolling interests in the acquired entity. The
Company is currently evaluating the impact of adopting
the statement, which is effective for fiscal years beginning
on or after December 15, 2008.

In September 2006, the FASB issued SFAS No. 157, “Fair

Value Measurements.” This statement defines fair value,
establishes a framework for measuring fair value in
generally accepted accounting principles (“GAAP”), and
expands disclosures about fair value measurements. The
statement applies to accounting pronouncements that
require or permit fair value measurements, except for
share-based payments transactions under SFAS No. 123R
and is effective for financial statements issued for fiscal
years beginning after November 15, 2007. The Company
does not believe adoption of SFAS No. 157 will have a
material effect on its financial statements.

In February 2007, the FASB issued SFAS No. 159, “The Fair
Value Option for Financial Assets and Financial Liabilities,”
(“SFAS No. 159”) which provides companies with an option
to report selected financial assets and liabilities at fair value.
SFAS No. 159 also establishes presentation and disclosure

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

requirements designed to facilitate comparisons between
companies that choose different measurement attributes from
similar types of assets and liabilities. The statement does not
eliminate the disclosure requirements of other accounting
standards, including requirements for disclosures about fair
value measurements in SFAS No. 107, “Disclosure About Fair
Value of Financial Instruments,” and SFAS No. 157. The
Company is currently evaluating the impact of adopting the
statement, which becomes effective for fiscal years beginning
after November 15, 2007.

(2) REAL ESTATE INVESTMENTS

The Company’s investments in real estate, net of

depreciation, were composed of the following at October 31,
2008 and 2007 (in thousands):

Mortgage
Notes
Properties Properties Receivable

Core Non-Core

Retail
Office
Industrial

$465,690
7,621
—
$473,311

$ —
—
633
$633

2008
2007
Totals
Totals
$1,241 $466,931 $430,482
7,401
726
$1,241 $475,185 $438,609

— 7,621
633
—

The Company’s investments at October 31, 2008

consisted of equity interests in 44 properties, which are
located in various regions throughout the United States
and one mortgage note receivable. The Company’s
primary investment focus is neighborhood and
community shopping centers located in the northeastern
United States. These properties are considered core
properties of the Company. The remaining properties are
located outside of the northeastern United States and are
considered non-core properties. Since a significant
concentration of the Company’s properties are in the
northeast, market changes in this region could have an
effect on the Company’s leasing efforts and ultimately its
overall results of operations. The following is a summary
of the geographic locations of the Company’s investments
at October 31, 2008 and 2007 (in thousands):

Northeast
Midwest
Southwest

2008
$473,311
633
1,241
$475,185

2007
$436,578
726
1,305
$438,609

(3) CORE PROPERTIES

The components of core properties were as follows

(in thousands):

Land
Buildings and improvements

Accumulated depreciation

2008
$104,032
462,857
566,889
(93,578)
$473,311

2007
$ 94,930
426,546
521,476
(84,898)
$436,578

Space at the Company’s core properties is generally leased
to various individual tenants under short and intermediate-
term leases which are accounted for as operating leases.

Minimum rental payments on non-cancelable

operating leases totaling $397,310,000 become due as
follows: 2009—$57,955,000; 2010—$53,968,000; 2011—
$49,946,000; 2012—$44,045,000; 2013—$34,960,000 and
thereafter—$156,436,000.

Certain of the Company’s leases provide for the

payment of additional rent based on a percentage of the
tenant’s revenues. Such additional percentage rents are
included in operating lease income and were less than 1%
of consolidated revenues in each of the three years ended
October 31, 2008.

Owned Properties

In December 2007, the Company acquired a 20,000
square foot retail property located in Waldwick, New
Jersey (Waldwick) for $6.3 million including closing costs.
The property is net-leased to a single tenant under a long-
term lease arrangement.

In February 2008, the Company acquired two retail
properties, containing approximately 5,500 square feet of
GLA in Westchester County, New York for a cash purchase
price of $2.3 million including closing costs.

In August 2008, the Company acquired a 79,000 square

foot shopping center in Litchfield County, Connecticut
(Veteran’s Plaza) for a purchase price of $10.4 million,
including the assumption of a first mortgage loan. The
Company recorded the assumption of the mortgage loan
at its estimated fair value which approximated $3.7
million. The assumption of the mortgage loan represents
a non-cash financing activity and is therefore not
included in the accompanying 2008 consolidated cash
flow statement.

In May 2008, the Company paid a $750,000 deposit on a

contract to purchase an equity interest in a joint venture
which owns a 237,000 square foot shopping center in
Westchester County, New York. In November 2008, the
Company negotiated a termination of the contract and
forfeited $150,000 of the contract deposit. The $150,000
plus capitalized acquisition costs in the amount of $66,000
have been expensed in the fiscal 2008 consolidated
statement of income.

In October 2008, the Company paid a $500,000 deposit
on a contract to purchase an office building in Greenwich,
Connecticut. In November of 2008, the Company
terminated the contract during the due diligence period
and received its contract deposit back in December of 2008.
In January 2007, the Company acquired a 10,100 square

foot shopping center located in Monroe, Connecticut
(“Monroe”) for approximately $3.8 million, including
closing costs.

In April 2007, the Company acquired the Emerson

Shopping Plaza (“Emerson”), a 92,000 square foot
shopping center located in Emerson, New Jersey for a
purchase price of approximately $17.5 million, including
closing costs.

In January 2007, the Company entered into a lease with a
wholesale club to lease approximately 107,000 square feet of
space at The Dock Shopping Center, Stratford, Connecticut,
subject to certain conditions. In connection with the new
lease, the Company agreed to provide up to $6.75 million
toward the costs of redeveloping the space that previously
had been occupied by a tenant who, in a prior year, filed a
petition in bankruptcy and vacated the space. The former
tenant’s lease obligations were guaranteed through 2016 by
a corporate guarantor whereby the guarantor was released
from its obligations in exchange for a payment of $6 million.
The payment and release of guaranty were subject to certain
conditions contained in the agreement. The conditions were
satisfied on April 15, 2007 and the Company recorded the
guaranty payment as income in fiscal 2007.

In May 2007, the Company acquired, by contribution, a
20% economic interest in a general partnership which owns
a retail/office property in Westchester County, New York.
Simultaneously, the Company contributed one of its wholly-
owned retail properties into a newly formed limited liability
company (“LLC”). As a result of the contributions, the
Company owns approximately 76% of the LLC, the accounts
of which are included in the accompanying consolidated
financial statements at October 31, 2008. The Company has
recorded the non-controlling member’s share of the net
assets of the LLC of $546,000 in Minority Interests, in the
accompanying October 31, 2008 consolidated balance sheet.
The amount recorded for minority interest represents a
non-cash investing activity and is therefore not included
in the accompanying 2007 consolidated statement of cash
flows. The Company has among other things, guaranteed
a preferential return to the other member of the LLC of
$38,000 per annum.

In March 2006, the Company acquired three retail
properties totaling 50,000 square feet of GLA located in
Pelham, New York and Queens, New York (“Pelham
Properties”). The three properties were acquired for an
aggregate purchase price of $16.6 million.

URSTADT BIDDLE PROPERTIES INC.

of an acquired property, the value of above-market and
below-market leases are estimated based on the differences
between (i) contractual rentals and the estimated market
rents over the applicable lease term discounted back to the
date of acquisition utilizing a discount rate adjusted for the
credit risk associated with the respective tenants
and (ii) the estimated cost of acquiring such leases giving
effect to the Company’s history of providing tenant
improvements and paying leasing commissions, offset by a
vacancy period during which such space would be leased.
The aggregate value of in-place leases is measured by the
excess of (i) the purchase price paid for a property after
adjusting existing in-place leases to market rental rates over
(ii) the estimated fair value of the property “as-if-vacant,”
determined as set forth above. The above-market and
below-market lease intangibles are amortized to rental
income over the remaining non-cancelable terms of the
respective leases. If a lease were to be terminated prior to its
stated expiration, all unamortized amounts relating to the
lease would be immediately recognized in operations.
During fiscal 2008, the Company completed its

evaluation of the acquired leases at Waldwick and Ferry
Plaza. As a result of its evaluations, the Company has
allocated a total of $94,000 to an asset associated with
the net fair value assigned to the acquired leases at the
properties, which amount represents a non-cash investing
activity and is therefore not included in the accompanying
2008 consolidated statement of cash flows. The Company
is currently in the process of analyzing the fair value of in-
place leases for Veteran’s Plaza. Consequently, no value
has yet been assigned to the leases. Accordingly, the
purchase price allocation is preliminary and may be
subject to change.

For the years ended October 31, 2008, 2007 and 2006,
the net amortization of above-market and below-market
leases amounted to $50,000, $241,000 and $211,000,
respectively, which amounts are included in base rents
in the accompanying consolidated statements of income.

In fiscal 2008, the Company incurred costs of approximately

$8.7 million related to capital improvements to its properties
and leasing costs.

Consolidated Joint Ventures

Upon the acquisition of real estate properties, the fair

In April 2008, the Company through a subsidiary, which

value of the real estate purchased is allocated to the
acquired tangible assets (consisting of land, buildings and
building improvements) and identified intangible assets
and liabilities (consisting of above-market and below-
market leases and in-place leases), in accordance with SFAS
No. 141. The Company utilizes methods similar to those
used by independent appraisers in estimating the fair value
of acquired assets and liabilities. The fair value of the
tangible assets of an acquired property considers the value
of the property “as-if-vacant.” The fair value reflects the
depreciated replacement cost of the asset. In allocating
purchase price to identified intangible assets and liabilities

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

accumulate and are paid from future available cash, if any.
The general partner’s cash preferences are paid after the
limited partner’s preferences are satisfied. The balance of
available cash, if any, is distributed in accordance with the
respective partners’ interests. Upon liquidation, proceeds
from the sale of partnership assets are to be distributed in
accordance with the respective partners’ interests. The
limited partner is not obligated to make any additional
capital contributions to the partnership. Ironbound has
a defined termination date of December 31, 2099. The
Company has retained an affiliate of the limited partner
to provide management and leasing services for the
property through October 2016 for an annual fee equal
to two percent of rental income collected.

The assumption of the $11.9 million first mortgage loan
represents a non-cash financing activity and is therefore not
included in the accompanying 2008 consolidated statement
of cash flows. The limited partner interests in Ironbound are
reflected in the accompanying consolidated 2008 balance
sheet as Minority Interests in the amount of $5.6 million,
which approximates the fair market value of the limited
partner interest in Ironbound at October 31, 2008.
The Company is the general partner in another

consolidated limited partnership which owns a shopping
center. The limited partnership has a defined termination
date of December 31, 2097. The partners are entitled to
receive an annual cash preference payable from available
cash of the partnership. Any unpaid preferences accumulate
and are paid from future cash, if any. The limited partners’
cash preferences are paid after the general partner’s
preferences are satisfied. The balance of available cash, if
any, is distributed in accordance with the respective
partner’s interests. Upon liquidation of the partnership,
proceeds from the sale of partnership assets are to be
distributed in accordance with the respective partnership
interests. The partners are not obligated to make any
additional capital contributions to the partnership. The
Company had retained an affiliate of one of the limited
partners to provide management and leasing services to the
property at an annual fee of $125,000 through June 2007.
The limited partner interest is reflected in the accompanying
consolidated financial statements as Minority Interests.
In August 2007, the Company purchased all of the

limited partner interests in another consolidated
partnership, in which the Company was the sole general
partner for $2.8 million. As a result of the purchase, the
partnership was terminated and the property is now
directly owned by the Company.

The Company adopted the provisions of Statement of
Financial Accounting Standards No. 150, “Accounting for
Certain Financial Instruments with Characteristics of both
Liabilities and Equity” (“SFAS No. 150”). SFAS No. 150
establishes standards for classifying and measuring as
liabilities certain financial instruments that embody

obligations of the issuer and have characteristics of both
liabilities and equity. The FASB deferred the classification
and measurement provisions of SFAS No. 150 that apply
to certain mandatory redeemable non-controlling
interests. This deferral is expected to remain in effect
while these provisions are further evaluated by the FASB.
The Company has two finite life joint ventures, which
contain mandatory redeemable non-controlling interests.
At October 31, 2008, the estimated fair value of the
minority interests was approximately $10 million. The
joint ventures have termination dates of December 31,
2097 and December 31, 2099.

(4) NON-CORE PROPERTIES

At October 31, 2008, the non-core properties consist of
two industrial properties located outside of the Northeast
region of the United States. The Board of Directors has
authorized management, subject to its approval of any
contract for sale, to sell the non-core properties of the
Company over a period of several years in furtherance of
the Company’s objectives to focus on northeast properties.
The components of non-core properties were as follows

(in thousands):

Land
Buildings and improvements

Accumulated depreciation

2008
$ 450
934
1,384
(751)
$ 633

2007
$ 450
933
1,383
(657)
$ 726

Minimum rental payments on non-cancelable operating

leases of the non-core properties totaling $5,573,000
become due as follows: 2009—$1,840,000; 2010—
$1,840,000; 2011—$1,266,000; 2012—$627,000.

(5) DISCONTINUED OPERATIONS

The Company has adopted the provisions of Statement of

Financial Accounting Standards No. 144, “Accounting for
the Impairment or Disposal of Long-Lived Assets” (SFAS
No. 144). SFAS No. 144 requires, among other things, that
the results of operations of properties sold or that otherwise
qualify as held for sale be classified as discontinued
operations and presented separately in the Company’s
consolidated financial statements.

In fiscal 2007, the Company sold a non-core retail property,
in Tempe, Arizona, for a sale price of $13.2 million, resulting in
a gain on sale of the property of approximately $11.4 million.

The operating results for the sold property have been
classified as discontinued operations in the accompanying
fiscal 2007 and 2006 consolidated financial statements.
Revenues from discontinued operations were approximately
$320,000 and $747,000 for the years ended October 31, 2007
and 2006, respectively.

URSTADT BIDDLE PROPERTIES INC.

based on outstanding borrowings during the year. The
Facility contains certain representations, financial and
other covenants typical for this type of facility. The
Company’s ability to borrow under the Facility is subject
to its compliance with the covenants and other restrictions
on an ongoing basis. The principal financial covenants
limit the Company’s level of secured and unsecured
indebtedness and additionally require the Company to
maintain certain debt coverage ratios.

In April 2008, borrowings under the Facility were used
to refinance an existing mortgage note payable, which was
secured by the Company’s Staples property in the amount
of $7.9 million. In conjunction with that transaction, the
mortgage was assigned to the lender of the Facility and as
a result $7.9 million of the outstanding balance of $13.0
million on the Facility is shown as a mortgage note payable
on the accompanying October 31, 2008 consolidated balance
sheet. Interest on outstanding borrowings under the Facility
is currently accruing at approximately 1.35% per annum.
The Company also has a Secured Revolving Credit

Facility with The Bank of New York Mellon (the “Secured
Credit Facility”). The Secured Credit Facility provides for
borrowings of up to $30 million. The maturity date of the
Facility is April 15, 2011 and is collateralized by first
mortgage liens on two of the Company’s properties.
Interest on outstanding borrowings is at The Bank of
New York Mellon’s prime lending rate plus 0.50% or the
Eurodollar rate plus 1.75%. The Secured Credit Facility
requires the Company to maintain certain debt service
coverage ratios during its term. The Company pays an
annual fee of 0.25% on the unused portion of the Secured
Credit Facility. The Secured Credit Facility is available
to fund acquisitions, capital expenditures, mortgage
repayments, working capital and other general corporate
purposes. At October 31, 2008, there were no outstanding
borrowings on the Secured Credit Facility.

Interest paid in the years ended October 31, 2008, 2007
and 2006 was approximately $7.0 million, $7.8 million and
$8.5 million, respectively.

(8) REDEEMABLE PREFERRED STOCK

The Company is authorized to issue up to 20,000,000

shares of Preferred Stock. At October 31, 2008, the Company
had issued and outstanding 400,000 shares of Series C
Senior Cumulative Preferred Stock (Series C Preferred
Stock), 2,450,000 shares of Series D Senior Cumulative
Preferred Stock (Series D Preferred Stock) (see Note 9) and
2,400,000 shares of Series E Senior Cumulative Preferred
Stock (Series E Preferred Stock).

(6) MORTGAGE NOTES RECEIVABLE

At October 31, 2008, mortgage notes receivable consisted
of one fixed rate mortgage with a contractual interest rate of
9%. The mortgage note matures in 2013 and is secured by a
retail property. Interest is recognized on the effective yield
method. The mortgage note is recorded at a discounted
amount which reflects the market interest rate at the time of
acceptance of the note. At October 31, 2008, the remaining
unamortized discount was $115,000.

At October 31, 2008, principal payments on the mortgage

note receivable become due as follows: 2009—$98,000;
2010—$108,000; 2011—$118,000; 2012—$129,000; and
thereafter—$903,000.

(7) MORTGAGE NOTES PAYABLE AND BANK

LINES OF CREDIT

At October 31, 2008, mortgage notes payable are due in
installments over various periods to fiscal 2019 at effective
rates of interest ranging from 5.09% to 7.78% and are
collateralized by real estate investments having a net
carrying value of $199,087,000.

Combined aggregate principal maturities of mortgage
notes payable during the next five years and thereafter are
as follows (in thousands):

2009
2010
2011
2012
2013
Thereafter

Scheduled

Principal
Amortization Repayments
$15,402
5,155
11,817
3,790
3,190
52,244
$91,598

$ 1,780
1,452
1,474
1,364
1,259
6,027
$13,356

Total
$ 17,182
6,607
13,291
5,154
4,449
58,271
$104,954

The Company has a $50 million Unsecured Revolving
Credit Agreement (the “Facility”) with The Bank of New
York Mellon and Wells Fargo Bank N.A. The facility gives
the Company the option, under certain conditions, to
increase the Facility’s borrowing capacity up to $100
million. The maturity date of the Facility is February 11,
2011 with two one-year extensions at the Company’s
option. Borrowings under the Facility can be used for,
among other things, acquisitions, working capital, capital
expenditures, repayment of other indebtedness and the
issuance of letters of credit (up to $10 million). Borrowings
will bear interest at the Company’s option of Eurodollar
plus 0.85% or The Bank of New York Mellon’s prime
lending rate plus 0.50%. The Company will pay an annual
fee on the unused commitment amount of up to 0.175%

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table sets forth the details of the Company’s redeemable preferred stock as of October 31, 2008 and 2007

(amounts in thousands, except share data):

8.99% Series B Senior Cumulative Preferred Stock; liquidation preference

of $100 per share; issued and outstanding -0- and 150,000 shares

8.50% Series C Senior Cumulative Preferred Stock; liquidation preference

of $100 per share; issued and outstanding 400,000 shares

8.50% Series E Senior Cumulative Preferred Stock; liquidation preference

of $25 per share; issued and outstanding 2,400,000 and -0- shares

Total Redeemable Preferred Stock

October 31,

2008

2007

$ —

$14,341

38,406

57,797
$96,203

—
$52,747

On March 13, 2008, the Company sold 2,400,000 shares of
a new issue of 8.50% Series E Senior Cumulative Preferred
Stock (“Series E Preferred Stock”) for net proceeds of $57.8
million. The Series E Preferred Stock entitles the holders
thereof to cumulative cash dividends payable quarterly in
arrears at the rate of 8.5% per annum on the $25 per share
liquidation preference.

In conjunction with the sale of the Series E Preferred

Stock, on March 14, 2008, the Company redeemed all
150,000 shares outstanding of its Series B Preferred Stock
for the redemption price in the amount of $15.0 million.
As a result of the redemption, the $660,000 excess of the
redemption price of the preferred shares paid over the
carrying amount of the shares is included in the
accompanying consolidated statement of income for year
ended October 31, 2008 as a reduction of income available
to Common and Class A Common shareholders.

The Series E Preferred Stock and Series C Preferred Stock
have no stated maturity, are not subject to any sinking fund
or mandatory redemption and are not convertible into other
securities or property of the Company. Commencing May
2010 (Series C Preferred Stock) and March 2013 (Series E
Preferred Stock), the Company, at its option, may redeem
the preferred stock issues, in whole or in part, at a
redemption price equal to the liquidation preference
per share, plus all accrued and unpaid dividends.

Upon a change in control of the Company (as defined),

each holder of Series C Preferred Stock and Series E
Preferred Stock has the right, at such holder’s option, to
require the Company to repurchase all or any part of such
holder’s stock for cash at a repurchase price equal to the
liquidation preference per share plus all accrued and
unpaid dividends.

The Series C Preferred Stock and Series E Preferred Stock

contain covenants that require the Company to maintain
certain financial coverages relating to fixed charge and
capitalization ratios. Shares of both Preferred Stock series are
non-voting; however, under certain circumstances (relating
to non-payment of dividends or failure to comply with the
financial covenants) the preferred stockholders will be
entitled to elect two directors. The Company was in
compliance with such covenants at October 31, 2008.

As the holders of the Series C Preferred Stock and Series E

Preferred Stock only have a contingent right to require the
Company to repurchase all or part of such holder’s shares
upon a change of control of the Company (as defined), the
Series C Preferred Stock and Series E Preferred Stock are
classified as redeemable equity instruments as a change in
control is not certain to occur.

(9) STOCKHOLDERS’ EQUITY

The Series D Preferred Stock has no maturity and is not

convertible into any other security of the Company. The
Series D Preferred Stock is redeemable at the Company’s
option on or after April 12, 2010 at a price of $25 per
share plus accrued and unpaid dividends. Underwriting
commissions and costs incurred in connection with the
sale of the Series D Preferred Stock are reflected as a
reduction of additional paid in capital.

The Class A Common Stock entitles the holder to 1/20 of
one vote per share. The Common Stock entitles the holder
to one vote per share. Each share of Common Stock and
Class A Common Stock have identical rights with respect
to dividends except that each share of Class A Common
Stock will receive not less than 110% of the regular
quarterly dividends paid on each share of Common Stock.
The Company has a Dividend Reinvestment and Share

Purchase Plan as amended (the “DRIP”), that permits
stockholders to acquire additional shares of Common Stock
and Class A Common Stock by automatically reinvesting
dividends. During fiscal 2008, the Company issued 43,636
shares of Common Stock and 14,765 shares of Class A
Common Stock (32,377 shares of Common Stock and 12,444
shares of Class A Common Stock in fiscal 2007) through the
DRIP. As of October 31, 2008, there remained 133,692 shares
of common stock and 466,820 shares of Class A common
stock available for issuance under the DRIP.

The Company has a stockholder rights agreement that
expires on November 11, 2018. The rights are not currently
exercisable. When they are exercisable, the holder will
be entitled to purchase from the Company one one-
hundredth of a share of a newly-established Series A
Participating Preferred Stock at a price of $65 per one
one-hundredth of a preferred share, subject to certain

adjustments. The distribution date for the rights will occur
10 days after a person or group either acquires or obtains
the right to acquire 10% (“Acquiring Person”) or more of
the combined voting power of the Company’s Common
Shares, or announces an offer, the consummation of which
would result in such person or group owning 30% or more
of the then outstanding Common Shares. Thereafter,
shareholders other than the Acquiring Person will be
entitled to purchase original common shares of the
Company having a value equal to two times the exercise
price of the right.

If the Company is involved in a merger or other business
combination at any time after the rights become exercisable,
and the Company is not the surviving corporation or 50%
or more of the Company assets are sold or transferred, the
rights agreement provides that the holder other than the
Acquiring Person will be entitled to purchase a number of
shares of common stock of the acquiring company having a
value equal to two times the exercise price of each right.

The Company’s articles of incorporation provide that if
any person acquires more than 7.5% of the aggregate value
of all outstanding stock, except, among other reasons, as
approved by the Board of Directors, such shares in excess
of this limit automatically shall be exchanged for an equal
number of shares of Excess Stock. Excess Stock has limited
rights, may not be voted and is not entitled to any dividends.
In March 2008, the Board of Directors of the Company
granted an irrevocable waiver to the 7.5% limit to the
purchaser and any subsequent owners of the Series E
Preferred Stock.

In a prior year, the Board of Directors of the Company
approved a share repurchase program (“Program”) for the
repurchase of up to 500,000 shares of Common Stock and
Class A Common Stock in the aggregate. On March 6,
2008, the Board of Directors amended the Program to
allow the Company to repurchase up to 1,000,000 shares of
Common and Class A Common stock in the aggregate. In
December 2008, the Board of Directors further amended
the Program to allow the Company to repurchase up to
1,500,000 shares of Common and Class A Common stock in
the aggregate. In addition, the Board of Directors amended
the Program to allow the Company to repurchase shares of
the Company’s Series C and Series D Senior Cumulative
Preferred Stock (Preferred Stock) in open-market
transactions. During fiscal 2008 and 2007, the Company
repurchased 623,278 shares of Class A Common Stock at
an aggregate price of $9.0 million and 21,200 shares of
Class A Common Shares at an aggregate repurchase price
of $317,000, respectively. As of October 31, 2008, the
Company had repurchased 3,600 shares of Common Stock
and 685,878 shares of Class A Common Stock under the
repurchase program. The Company has yet to repurchase
any Preferred Stock under the Program.

URSTADT BIDDLE PROPERTIES INC.

(10) STOCK COMPENSATION AND OTHER

BENEFIT PLANS

Restricted Stock Plan

In March 2008, the stockholders of the Company
approved an amendment to the restricted stock plan
for key employees and directors of the Company. The
restricted stock plan (“Plan”) provides for the grant of
up to 2,350,000 shares of the Company’s common equity
consisting of 350,000 Common shares, 350,000 Class A
Common shares and 1,650,000 shares, which at the
discretion of the Company’s compensation committee,
may be awarded in any combination of Class A Common
shares or Common shares.

Prior to November 1, 2005, the grant date fair value
of nonvested restricted stock awards was expensed over
the explicit stock award vesting periods. Such awards
provided for continued vesting after retirement. Upon
adoption of SFAS No. 123R, the Company changed its
policy for recognizing compensation expense for restricted
stock awards to the earlier of the explicit vesting period or
the date a participant first becomes eligible for retirement.
For nonvested restricted stock awards granted prior to the
adoption of SFAS No.123R, the Company continues to
recognize compensation expense over the explicit vesting
periods and accelerates any remaining unrecognized
compensation cost when a participant actually retires.
Had compensation expense for nonvested restricted

stock awards issued prior to November 1, 2005 been
determined based on the date a participant first becomes
eligible for retirement, the Company’s income from
continuing operations in the three-year period ended
October 31, 2008 would have been as follows (amounts
in thousands, except per share):

Year Ended October 31,
2008

2007

2006

Income from continuing
operations, as reported
Adjustment to compensation
expense had SFAS No. 123R
been adopted prior to
November 1, 2005
Pro forma income from
continuing operations

Pro forma earnings per share
from continuing operations:

Basic:

Common share
Class A Common share

Diluted:

Common share
Class A Common share

$16,147

$23,409 $15,202

295

428

551

$16,442

$23,837 $15,753

$.61
$.67

$.59
$.66

$.87
$.97

$.85
$.94

$.58
$.65

$.57
$.64

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In January 2008, the Company awarded 170,900 shares
of Common Stock and 59,900 shares of Class A Common
Stock to participants in the Plan. The grant date fair value
of restricted stock grants awarded to participants was
$3.4 million. As of October 31, 2008, there remained a
total of $11.1 million of unrecognized restricted stock
compensation related to outstanding nonvested restricted

stock grants awarded under the Plan and outstanding at
that date. Restricted stock compensation is expected to be
expensed over a remaining weighted average period of
5.8 years. For the years ended October 31, 2008, 2007 and
2006, amounts charged to compensation expense totaled
$1,713,000, $2,071,000 and $2,007,000, respectively.

A summary of the status of the Company’s nonvested restricted stock awards as of October 31, 2008, and changes

during the year ended October 31, 2008 are presented below:

Nonvested at November 1, 2007

Granted
Vested
Forfeited

Nonvested at October 31, 2008

Common Shares

Class A Common Shares

Weighted-Average
Grant Date
Fair Value
$14.16
$14.77
$11.73
$ —
$14.54

Shares
897,400
170,900
(106,550)
—
961,750

Weighted-Average
Grant Date
Fair Value
$13.90
$15.20
$11.03
$16.40
$14.21

Shares
423,350
59,900
(80,050)
(82,000)
321,200

Stock Option Plan

Prior to December 2007, the Company had a stock option
plan whereby shares of Common Stock and Class A Common
Stock were reserved for issuance to key employees and
Directors of the Company. In December 2007, the Board of
Directors approved the termination of the stock option plan.
There were no grants of stock options in each of the three
years ended October 31, 2008. At October 31, 2008, there were
outstanding stock options to purchase 2,000 shares of
Common Stock and 2,000 shares of Class A Common Stock.
In connection with the exercise in a prior year of stock
options granted to an officer under the Company’s stock
option plan (terminated in 2007), the officer executed a
full recourse promissory note equal to the purchase price
of the shares. The note receivable in the amount of
$1,300,000 was repaid in full in December 2007.

Profit Sharing and Savings Plan

The Company has a profit sharing and savings plan (the
“401K Plan”), which permits eligible employees to defer a
portion of their compensation in accordance with the
Internal Revenue Code. Under the 401K Plan, the Company
made contributions on behalf of eligible employees. For the
years ended October 31, 2008, 2007 and 2006, the Company
made contributions to the 401K Plan of $140,000, $140,000
and $149,000, respectively. The Company also has an Excess
Benefit and Deferred Compensation Plan that allows
eligible employees to defer benefits in excess of amounts
provided under the Company’s 401K Plan and a portion
of the employee’s current compensation.

(11) COMMITMENTS AND CONTINGENCIES

In the normal course of business, from time to time,
the Company is involved in legal actions relating to the
ownership and operations of its properties. In management’s
opinion, the liabilities, if any, that ultimately may result
from such legal actions are not expected to have a material
adverse effect on the consolidated financial position, results
of operations or liquidity of the Company.

At October 31, 2008, the Company had commitments
of approximately $1,186,000 for tenant-related obligations.

(12) QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

The unaudited quarterly results of operations for the years ended October 31, 2008 and 2007 are as follows (in

thousands, except per share data):

URSTADT BIDDLE PROPERTIES INC.

Year Ended October 31, 2008
Quarter Ended
Apr 30

July 31

Jan 31

Oct 31

Revenues (1)
Income from Continuing Operations
Net Income
Preferred Stock Dividends
Redemption of Preferred Stock
Net Income Applicable to Common

$19,431
$ 6,828
$ 6,828
(2,336)
—

$20,564
$ 7,610
$ 7,610
(2,835)
(660)

$20,235
$ 7,592
$ 7,592
(3,274)
—

$20,626
$ 6,495
$ 6,495
(3,273)
—

Year Ended October 31, 2007
Quarter Ended

Jan 31

Apr 30

July 31

Oct 31

$19,310
$ 7,149
$ 7,149
(2,336)
—

$25,163
$12,624
$24,168
(2,335)
—

$19,138
$ 6,519
$ 6,519
(2,336)
—

$18,269
$ 6,459
$ 6,552
(2,335)
—

and Class A Common Stockholders (2)

$ 4,492

$ 4,115

$ 4,318

$ 3,222

$ 4,813

$21,833

$ 4,183

$ 4,217

Per Share Data:
Net Income from Continuing

Operations—Basic:

Class A Common Stock
Common Stock

Net Income from Continuing
Operations-—Diluted:

Class A Common Stock
Common Stock

$.18
$.16

$.17
$.15

$.18
$.16

$.13
$.12

$.20
$.18

$.42
$.38

$.17
$.15

$.16
$.15

$.18
$.16

$.16
$.15

$.17
$.16

$.13
$.12

$.19
$.17

$.41
$.37

$.17
$.15

$.16
$.14

(1) Includes settlement of lease guarantee obligation of $6 million in quarter ended April 30, 2007.

(2) Includes gains on sales of properties of $11.4 million in quarter ended April 30, 2007.

(13) SUBSEQUENT EVENTS

On December 10, 2008, the Board of Directors of the Company declared cash dividends of $0.2175 for each share of
Common Stock and $0.24 for each share of Class A Common Stock. The dividends are payable on January 20, 2009 to
stockholders of record on January 6, 2009. The Board of Directors also ratified the actions of the Company’s compensation
committee authorizing the awards of 170,900 shares of Common Stock and 63,200 shares of Class A Common Stock to
certain key officers and directors of the Company effective January 2, 2009 pursuant to the Company’s restricted stock plan.
The fair value of the shares awarded totaling $3.4 million will be charged to expense over the respective vesting periods.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of Urstadt Biddle Properties Inc.

We have audited the accompanying consolidated balance sheets of Urstadt Biddle Properties Inc. (the “Company”) as of
October 31, 2008 and 2007 and the related consolidated statements of income, stockholders’ equity, and cash flows for each
of the three years in the period ended October 31, 2008. These financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United

States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial
position of Urstadt Biddle Properties Inc. at October 31, 2008 and 2007, and the consolidated results of its operations and its
cash flows for each of the three years in the period ended October 31, 2008, in conformity with accounting principles generally
accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United

States), the Company’s internal control over financial reporting as of October 31, 2008 based on criteria established in Internal
Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our
report dated January 9, 2009 expressed an unqualified opinion thereon.

New York, New York
January 9, 2009

PKF
Certified Public Accountants
A Professional Corporation

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction
with the consolidated financial statements of the Company
and the notes thereto included elsewhere in this report.

FORWARD-LOOKING STATEMENTS

This report includes certain statements that may be
deemed to be “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. All statements, other than statements
of historical facts, included in this report that address
activities, events or developments that the Company
expects, believes or anticipates will or may occur in
the future, including such matters as future capital
expenditures, dividends and acquisitions (including the
amount and nature thereof), business strategies, expansion
and growth of the Company’s operations and other such
matters are forward-looking statements. These statements
are based on certain assumptions and analyses made by
the Company in light of its experience and its perception
of historical trends, current conditions, expected future
developments and other factors it believes are appropriate.
Such statements are subject to a number of assumptions,
risks and uncertainties, general economic and business
conditions, the business opportunities that may be
presented to and pursued by the Company, changes in
laws or regulations and other factors, many of which are
beyond the control of the Company. Any forward-looking
statements are not guarantees of future performance and
actual results or developments may differ materially
from those anticipated in the forward-looking statements.

EXECUTIVE SUMMARY

The Company, a REIT, is a fully integrated, self-
administered real estate company, engaged in the
acquisition, ownership and management of commercial real
estate, primarily neighborhood and community shopping
centers in the northeastern part of the United States. Other
real estate assets include office and industrial properties.
The Company’s major tenants include supermarket chains
and other retailers who sell basic necessities. At October 31,
2008, the Company owned or had interests in 44 properties
containing a total of 3.9 million square feet of GLA of which
approximately 95% was leased.

The Company derives substantially all of its revenues
from rents and operating expense reimbursements received
pursuant to long-term leases and focuses its investment
activities on community and neighborhood shopping
centers, anchored principally by regional supermarket
chains. The Company believes, because of the need of
consumers to purchase food and other staple goods and
services generally available at supermarket-anchored
shopping centers, that the nature of its investments provide
for relatively stable revenue flows even during difficult

economic times. The Company is experiencing and, in fiscal
2009, expects that it will continue to experience increased
vacancy rates at some of its shopping centers and a
lengthening in the time required for releasing of vacant
space, as the current economic downturn continues to
negatively affect retail companies. However, the Company
believes it is well positioned to weather these difficulties.
Notwithstanding the increase in vacancy rates at various
properties, approximately 95% of the Company’s portfolio
remains leased. The Company has a strong capital structure
with, by industry standards, a small amount of debt
maturing in the next 12 months that the Company believes
it can refinance or repay with available cash or borrowings
under its credit facilities. The Company expects to continue
to explore acquisition opportunities that might present
themselves during this economic downturn consistent with
its business strategy.

Primarily as a result of recent property acquisitions, the
Company’s financial data shows increases in total revenues
and expenses from period to period.

The Company focuses on increasing cash flow, and

consequently the value of its properties, and seeks
continued growth through strategic re-leasing, renovations
and expansion of its existing properties and selective
acquisition of income producing properties, primarily
neighborhood and community shopping centers in the
northeastern part of the United States.

Key elements of the Company’s growth strategies and

operating policies are to:

• Acquire neighborhood and community shopping

centers in the northeastern part of the United States
with a concentration in Fairfield County, Connecticut,
Westchester and Putnam Counties, New York and
Bergen County, New Jersey

• Hold core properties for long-term investment and
enhance their value through regular maintenance,
periodic renovation and capital improvement

• Selectively dispose of non-core and underperforming
properties and re-deploy the proceeds into properties
located in the northeast region

• Increase property values by aggressively marketing

available GLA and renewing existing leases

• Renovate, reconfigure or expand existing properties

to meet the needs of existing or new tenants

• Negotiate and sign leases which provide for regular
or fixed contractual increases to minimum rents

• Control property operating and administrative costs

CRITICAL ACCOUNTING POLICIES

Critical accounting policies are those that are both

important to the presentation of the Company’s financial
condition and results of operations and require
management’s most difficult, complex or subjective
judgments. Set forth below is a summary of the accounting

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

policies that management believes are critical to the
preparation of the consolidated financial statements. This
summary should be read in conjunction with the more
complete discussion of the Company’s accounting policies
included in Note 1 to the consolidated financial statements
of the Company.

Revenue Recognition

The Company records base rents on a straight-line basis
over the term of each lease. The excess of rents recognized
over amounts contractually due pursuant to the underlying
leases is included in tenant receivables on the accompanying
balance sheets. Most leases contain provisions that require
tenants to reimburse a pro-rata share of real estate taxes and
certain common area expenses. Adjustments are also made
throughout the year to tenant receivables and the related
cost recovery income based upon the Company’s best
estimate of the final amounts to be billed and collected.

Allowance for Doubtful Accounts

The allowance for doubtful accounts is established based

on a quarterly analysis of the risk of loss on specific
accounts. The analysis places particular emphasis on past-
due accounts and considers information such as the nature
and age of the receivables, the payment history of the
tenants or other debtors, the financial condition of the
tenants and any guarantors and management’s assessment
of their ability to meet their lease obligations, the basis for
any disputes and the status of related negotiations, among
other things. Management’s estimates of the required
allowance is subject to revision as these factors change and
is sensitive to the effects of economic and market conditions
on tenants, particularly those at retail properties. Estimates
are used to establish reimbursements from tenants for
common area maintenance, real estate tax and insurance
costs. The Company analyzes the balance of its estimated
accounts receivable for real estate taxes, common area
maintenance and insurance for each of its properties by
comparing actual recoveries versus actual expenses and any
actual write-offs. Based on its analysis, the Company may
record an additional amount in its allowance for doubtful
accounts related to these items. It is also the Company’s
policy to maintain an allowance of approximately 10% of
the deferred straight-line rents receivable balance for future
tenant credit losses.

Real Estate

Land, buildings, property improvements, furniture/
fixtures and tenant improvements are recorded at cost.
Expenditures for maintenance and repairs are charged to
operations as incurred. Renovations and/or replacements,
which improve or extend the life of the asset, are capitalized
and depreciated over their estimated useful lives.

The amounts to be capitalized as a result of an acquisition

and the periods over which the assets are depreciated or

amortized are determined based on estimates as to fair
value and the allocation of various costs to the individual
assets. The Company allocates the cost of an acquisition
based upon the estimated fair value of the net assets
acquired. The Company also estimates the fair value of
intangibles related to its acquisitions. The valuation of the
fair value of intangibles involves estimates related to
market conditions, probability of lease renewals and the
current market value of in-place leases. This market value
is determined by considering factors such as the tenant’s
industry, location within the property and competition
in the specific region in which the property operates.
Differences in the amount attributed to the intangible
assets can be significant based upon the assumptions
made in calculating these estimates.

The Company is required to make subjective assessments

as to the useful life of its properties for purposes of
determining the amount of depreciation. These assessments
have a direct impact on the Company’s net income.

Properties are depreciated using the straight-line method
over the estimated useful lives of the assets. The estimated
useful lives are as follows:

Buildings
Property Improvements
Furniture/Fixtures
Tenant Improvements

30-40 years
10-20 years
3-10 years
Shorter of lease term
or their useful life

Asset Impairment

On a periodic basis, management assesses whether there
are any indicators that the value of the real estate properties
may be impaired. A property value is considered impaired
when management’s estimate of current and projected
operating cash flows (undiscounted and without interest) of
the property over its remaining useful life is less than the net
carrying value of the property. Such cash flow projections
consider factors such as expected future operating income,
trends and prospects, as well as the effects of demand,
competition and other factors. To the extent impairment
has occurred, the loss is measured as the excess of the net
carrying amount of the property over the fair value of the
asset. Changes in estimated future cash flows due to changes
in the Company’s plans or market and economic conditions
could result in recognition of impairment losses which could
be substantial. Management does not believe that the value
of any of its rental properties is impaired at October 31, 2008.

LIQUIDITY AND CAPITAL RESOURCES

At October 31, 2008, the Company had unrestricted cash

and cash equivalents of $1.7 million compared to $4.2
million at October 31, 2007. The Company’s sources of
liquidity and capital resources include its cash and cash
equivalents, proceeds from bank borrowings and long-
term mortgage debt, capital financings and sales of real
estate investments. Payments of expenses related to real

estate operations, debt service, management and
professional fees, and dividend requirements place
demands on the Company’s short-term liquidity.

Cash Flows

The Company expects to meet its short-term liquidity
requirements primarily by generating net cash from the
operations of its properties. The Company believes that its
net cash provided by operations will be sufficient to fund
its short-term liquidity requirements for fiscal 2009 and to
meet its dividend requirements necessary to maintain its
REIT status. In fiscal 2008, 2007 and 2006, net cash flow
provided by operations amounted to $45.0 million, $49.3
million and $35.4 million, respectively. Cash dividends
paid on common and preferred shares increased to $36.0
million in fiscal 2008 compared to $33.1 million in fiscal
2007 and $32.4 million in fiscal 2006.

The Company expects to continue paying regular

dividends to its stockholders. These dividends will be paid
from operating cash flows which are expected to increase
due to property acquisitions and growth in operating
income in the existing portfolio and from other sources.
The Company derives substantially all of its revenues from
rents under existing leases at its properties. The Company’s
operating cash flow therefore depends on the rents that it is
able to charge to its tenants, and the ability of its tenants to
make rental payments. The Company believes that the
nature of the properties in which it typically invests,
primarily grocery-anchored neighborhood and community
shopping centers, provides a more stable revenue flow in
uncertain economic times, in that consumers still need to
purchase basic staples and convenience items. However,
even in the geographic areas in which the Company owns
properties, general economic downturns may adversely
impact the ability of the Company’s tenants to make lease
payments and the Company’s ability to re-lease space as
leases expire. In either of these cases, the Company’s cash
flow could be adversely affected.

Net Cash Flows From:

Operating Activities

URSTADT BIDDLE PROPERTIES INC.

years were principally due to the acquisition of properties
consistent with the Company’s strategic plan to acquire
properties in the northeast. The Company acquired five
properties in fiscal 2008, two properties in fiscal 2007 and
three properties in fiscal 2006. In fiscal 2007, the Company
also acquired the remaining limited partnership interest
in its Eastchester property for $2.8 million. In fiscal 2007,
the Company sold one property for $13.2 million. Sale
proceeds were used to purchase an additional property
in the northeast. The Company also invests in its properties
and regularly pays for capital expenditures for property
improvements, tenant costs and leasing commissions.

Financing Activities

The Company generated net cash from financing

activities in fiscal 2008 primarily from the sale of 2,400,000
shares of 8.5% Series E Senior Cumulative Preferred Stock
(“Series E Preferred Stock”) in the net amount of $58.0
million. The Company redeemed all of the outstanding
shares of 8.99% Series B Senior Cumulative Preferred Stock
(“Series B Preferred Stock”) for $15.0 million in fiscal 2008.
The Company borrowed $18.1 million, $14.2 million, and
$3.0 million from its revolving lines of credit in fiscal 2008,
2007 and 2006, respectively, primarily to finance property
acquisitions and to repurchase Class A Common Stock.
During the fiscal year ended 2008, 2007 and 2006, the
Company repaid borrowings under its revolving lines of
credit in the amount of $25.2 million, $2.0 million and $3.0
million, respectively. Net cash used in financing activities
in each of the fiscal years 2008, 2007 and 2006 reflect
distributions to its shareholders each year of $36.0 million
in fiscal 2008, $33.1 million in fiscal 2007 and $32.4 million
in fiscal 2006. Cash used in financing activities also
included $9.0 million in fiscal 2008 and $317,000 in fiscal
2007 for the repurchase of the Company’s shares of Class A
Common Stock. Cash used in financing activities for
required principal payments on mortgages totaled $1.7
million in fiscal 2008, $2.3 million in fiscal 2007 and $2.4
million in fiscal 2006. The Company repaid mortgages
payable totaling $5.3 million in fiscal 2008, $5.7 million
in fiscal 2007 and $5.0 million in fiscal 2006.

Net cash flows provided by operating activities amounted

Capital Resources

to $45.0 million in fiscal 2008, compared to $49.3 million in
fiscal 2007 and $35.4 million in fiscal 2006. The changes in
operating cash flows were primarily due to increases in
the net operating results generated from the Company’s
properties and operating cash flows from new properties
acquired during those periods and, in 2007, the receipt of a
$6 million settlement of a lease guarantee obligation.

Investing Activities

Net cash flows used in investing activities were $33.7
million in fiscal 2008, $19.5 million in fiscal 2007 and $20.1
million in fiscal 2006. The net cash flows in each of these

The Company expects to fund its long-term liquidity
requirements such as property acquisitions, repayment of
indebtedness and capital expenditures through other long-
term indebtedness (including indebtedness assumed in
acquisitions), proceeds from sales of properties and/or the
issuance of equity securities. The Company believes that
these sources of capital will continue to be available to it
in the future to fund its long-term capital needs; however,
there are certain factors that may have a material adverse
effect on its access to capital sources. The Company’s ability
to incur additional debt is dependent upon its existing
leverage, the value of its unencumbered assets and

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In February 2008, the Company entered into a new $50

Million Unsecured Revolving Credit Agreement (the
“Unsecured Facility”) with The Bank of New York Mellon
and Wells Fargo Bank N.A. The agreement gives the
Company the option, under certain conditions, to increase
the Facility’s borrowing capacity up to $100 million. The
maturity date of the Unsecured Facility is February 11, 2011
with two one-year extensions at the Company’s option.
Borrowings under the Unsecured Facility can be used for,
among other things, acquisitions, working capital, capital
expenditures, repayment of other indebtedness and the
issuance of letters of credit (up to $10 million). Borrowings
bear interest at the Company’s option of Eurodollar plus
0.85% or The Bank of New York Mellon’s prime lending rate
plus 0.50%. The Company pays an annual fee on the unused
commitment amount of up to 0.175% based on outstanding
borrowings during the year. The Unsecured Facility
contains certain representations, financial and other
covenants typical for this type of facility. The Company’s
ability to borrow under the Unsecured Facility is subject to
its compliance with the covenants and other restrictions on
an ongoing basis. The principal financial covenants limit the
Company’s level of secured and unsecured indebtedness
and additionally require the Company to maintain certain
debt coverage ratios. As of October 31, 2008, the Company
was in compliance with such covenants in the Unsecured
Facility and in the Secured Facility discussed below.

On April 15, 2008, the Company renewed its secured

revolving credit facility with The Bank of New York Mellon
(the “Secured Facility”) which provides for borrowings of
up to $30 million for an additional three years to April 2011.
The Secured Facility is collateralized by first mortgage liens
on two of the Company’s properties. Interest on outstanding
borrowings is at The Bank of New York Mellon’s prime
lending rate plus 0.50% or Eurodollar plus 1.75%. The
Secured Facility requires the Company to maintain certain
debt service coverage ratios during its term. The Company
pays an annual fee of 0.25% on the unused portion of the
Secured Facility. The Secured Facility is available to fund
acquisitions, capital expenditures, mortgage repayments,
working capital and other general corporate purposes.

borrowing limitations imposed by existing lenders. The
Company’s ability to raise funds through sales of equity
securities is dependent on, among other things, general
market conditions for REITs, market perceptions about the
Company and its stock price in the market. The Company’s
ability to sell properties in the future to raise cash will be
dependent upon market conditions at the time of sale.

Financings and Debt

During fiscal 2008, the Company sold 2,400,000 shares

of Series E Preferred Stock for net proceeds of $58.0
million. The Series E Preferred Stock entitles the holders
thereof to cumulative cash dividends payable quarterly in
arrears at the rate of 8.5% per annum on the $25 per share
liquidation preference. In conjunction with the sale of the
Series E Preferred Stock, the Company redeemed all
150,000 shares of its Series B Preferred Stock, for the
redemption price, as defined, in the amount of $15.0
million. The Company used a portion of the proceeds from
the sale of the Series E Preferred Stock to repay variable
rate debt and for property acquisitions.

The Company is exposed to interest rate risk primarily
through its borrowing activities. There is inherent rollover
risk for borrowings as they mature and are renewed at
current market rates. The extent of this risk is not
quantifiable or predictable because of the variability of
future interest rates and the Company’s future financing
requirements. Mortgage notes payable of $105.0 million
consist principally of fixed rate mortgage loan
indebtedness with a weighted average interest rate of 6.1%
at October 31, 2008. The mortgage loans are secured by 11
properties with a net book value of $199 million and
primarily have fixed rates of interest ranging from 5.09%
to 7.78%. The Company made principal payments of $7.0
million (including the repayment of $5.3 million in
mortgages that matured) in fiscal 2008 compared to $8.1
million (including the repayment of $5.7 million in
mortgages that matured) in fiscal 2007 and $7.4 million
(including the repayment of $5.0 million in mortgages that
matured) in fiscal 2006. The Company may refinance its
mortgage loans, at or prior to scheduled maturity, through
replacement mortgage loans. The ability to do so, however,
is dependent upon various factors, including the income
level of the properties, interest rates and credit conditions
within the commercial real estate market. Accordingly, there
can be no assurance that such refinancings can be achieved.
In fiscal 2007, the Company entered into an agreement

with a bank to extend the non-recourse mortgage note
payable on the Ridgeway Shopping Center in Stamford,
Connecticut with an outstanding principal balance of
approximately $52.5 million for a 10-year term and reset
the fixed interest rate from 7.54% to 5.52% commencing
October 1, 2007.

URSTADT BIDDLE PROPERTIES INC.

In December 2007, the Company acquired a 20,000
square foot retail property located in Waldwick, New
Jersey (Waldwick) for $6.3 million, including closing costs.
The property is net-leased to a single tenant under a long-
term lease arrangement.

In April 2008, the Company through a subsidiary, which

is the sole general partner, acquired a 60% interest in UB
Ironbound, LP, (“Ironbound”), a newly formed limited
partnership that acquired by contribution a 101,000 square
foot shopping center in Newark, New Jersey (Ferry Plaza),
valued at $26.3 million, including transaction costs of
approximately $297,000 and the assumption of an existing
first mortgage loan on the property at its estimated fair
value of $11.9 million at a fixed interest rate of 6.15%. The
Company’s net investment in Ironbound amounted to $8.6
million. The partnership agreement provides for the
partners to receive an annual cash preference from
available cash of the partnership. Any unpaid preferences
accumulate and are paid from future available cash, if any.
The general partner’s cash preferences are paid after the
limited partner’s preferences are satisfied. The balance of
available cash, if any, is distributed in accordance with the
respective partners’ interests. Upon liquidation, proceeds
from the sale of partnership assets are to be distributed in
accordance with the respective partners’ interests. The
limited partner is not obligated to make any additional
capital contributions to the partnership. Ironbound has
a defined termination date of December 31, 2099.

In August 2008, the Company acquired a 79,000 square
foot shopping center in Litchfield County, Connecticut for
a purchase price of $10.4 million, including the assumption
of a first mortgage loan. The Company recorded the
assumption of the mortgage loan at its estimated fair
value which approximated $3.7 million.

In May 2008, the Company paid a $750,000 deposit on a

Contractual Obligations

The Company’s contractual payment obligations as of
October 31, 2008 were as follows (amounts in thousands):

Payments Due by Period

Total

2009

2010

2011

2012

2013

There-
after

$104,954 $17,182 $6,607 $13,291 $5,154 $4,449 $58,271

1,186

—

$106,140 $18,368 $6,607 $13,291 $5,154 $4,449 $58,271

Mortgage
notes
payable

Tenant
obligations*

Total
Contractual
Obligations

*Committed tenant-related obligations based on executed leases as of
October 31, 2008.

The Company has various standing or renewable service
contracts with vendors related to its property management.
In addition, the Company also has certain other utility
contracts entered into in the ordinary course of business
which may extend beyond one year, which vary based
on usage. These contracts include terms that provide for
cancellation with insignificant or no cancellation penalties.
Contract terms are generally one year or less.

Off-Balance Sheet Arrangements

During the years ended October 31, 2008 and 2007,

the Company did not have any material off-balance
sheet arrangements.

Capital Expenditures

The Company invests in its existing properties and
regularly incurs capital expenditures in the ordinary
course of business to maintain its properties. The
Company believes that such expenditures enhance the
competitiveness of its properties. In fiscal 2008, the
Company paid approximately $8.7 million for property
improvements, tenant improvement and leasing
commission costs. The amounts of these expenditures
can vary significantly depending on tenant negotiations,
market conditions and rental rates. The Company expects
to incur approximately $3.5 million for anticipated capital
and tenant improvements and leasing costs in fiscal 2009.
These expenditures are expected to be funded from
operating cash flows or bank borrowings.

Acquisitions and Significant Property Transactions

The Company seeks to acquire properties which are
primarily shopping centers located in the northeastern
part of the United States with a concentration in Fairfield
County, Connecticut, Westchester and Putnam Counties,
New York and Bergen County, New Jersey.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In January 2007, the Company acquired a 10,100 square

Sales of Properties

foot shopping center located in Monroe, Connecticut
(“Monroe”) for $3.8 million, including closing costs.
In April 2007, the Company acquired the Emerson

Shopping Plaza (“Emerson”), a 92,000 square foot
shopping center located in Emerson, New Jersey for a
purchase price of approximately $17.5 million, including
closing costs.

In August 2007, the Company purchased all of the
limited partner operating partnership units (OPU’s) in a
consolidated partnership that owned The Shoppes at
Eastchester, in Eastchester, New York for $2.8 million. Prior
to the purchase, the Company was the sole general partner
in the partnership. As a result of the purchase, the
partnership terminated and the property is now directly
owned by the Company.

In January 2007, the Company entered into a lease with a

wholesale club to lease approximately 107,000 square feet
of space at The Dock Shopping Center, in Stratford,
Connecticut, subject to certain conditions. In connection
with the new lease, the Company agreed to provide up to
$6.75 million toward the costs of redeveloping the space
that previously had been occupied by a tenant who, in a
prior year, filed a petition in bankruptcy and vacated the
space. The former tenant’s lease obligation was guaranteed
through 2016 by a corporate guarantor previously
affiliated with the former tenant. In February 2007, the
Company executed a settlement agreement with the
guarantor whereby the guarantor was released from its
obligations in exchange for a payment to the Company
of $6 million that was received in fiscal 2007.

In fiscal 2007, the Company sold its Tempe, Arizona
property for a sale price of $13.2 million. The proceeds
were used to complete the acquisition of the Emerson,
New Jersey property. The Company recorded a gain
on sale of approximately $11.4 million in fiscal 2007.
There were no sales in fiscal 2008.

NON-CORE PROPERTIES

In a prior year, the Company’s Board of Directors
expanded and refined the strategic objectives of the
Company to refocus its real estate portfolio into one of
self-managed retail properties located in the northeast and
authorized the sale of the Company’s non-core properties
in the normal course of business over a period of several
years. The non-core properties consist of two distribution
service facilities (both of which are located outside of the
northeast region of the United States).

The Company intends to sell its remaining non-core

properties as opportunities become available. The
Company’s ability to generate cash from asset sales is
dependent upon market conditions and will be limited if
market conditions make such sales unattractive. In fiscal
2007, the Company sold its Tempe, Arizona property, a non-
core property, for $13.2 million and recorded a gain on sale
of the property of $11.4 million. There were no sales of non-
core properties in fiscal 2008. At October 31, 2008, the two
remaining non-core properties have a net book value of
approximately $630,000.

FUNDS FROM OPERATIONS

In May 2007, the Company formed a limited liability

The Company considers Funds from Operations (“FFO”)

company (“LLC”) to acquire by contribution a 20%
economic interest in a general partnership which owns a
retail/office property in Westchester County, New York.
Simultaneously, the Company contributed one of its
wholly-owned retail properties in Westchester County,
New York into the LLC. As a result of the contributions,
the Company owns approximately 76% of the LLC, the
accounts of which are included in the accompanying
consolidated financial statements at October 31, 2008. The
Company has recorded the non-controlling member’s
share of the net assets of the LLC of $546,000 in minority
interests in the accompanying October 31, 2008
consolidated balance sheet. The Company has, among
other things, guaranteed a preferential return to the other
member of the LLC of approximately $38,000 per annum.

In fiscal 2006, the Company acquired three retail
properties totaling 50,000 square feet of GLA at an
aggregate purchase price of $16.6 million.

to be an additional measure of an equity REIT’s operating
performance. The Company reports FFO in addition to its
net income applicable to common stockholders and net
cash provided by operating activities. Management has
adopted the definition suggested by The National
Association of Real Estate Investment Trusts (“NAREIT”)
and defines FFO to mean net income (computed in
accordance with generally accepted accounting principles
(“GAAP”)) excluding gains or losses from sales of
property, plus real estate-related depreciation and
amortization and after adjustments for unconsolidated
joint ventures.

Management considers FFO a meaningful, additional
measure of operating performance because it primarily
excludes the assumption that the value of its real estate
assets diminishes predictably over time and industry
analysts have accepted it as a performance measure. FFO
is presented to assist investors in analyzing the performance
of the Company. It is helpful as it excludes various items
included in net income that are not indicative of the
Company’s operating performance, such as gains (or losses)
from sales of property and deprecation and amortization.

URSTADT BIDDLE PROPERTIES INC.

FFO amounted to $30.4 million in fiscal 2008 compared
to $37.1 million in fiscal 2007, compared to $28.8 million
in fiscal 2006. The decrease in FFO in fiscal 2008, when
compared with fiscal 2007, is attributable, among other
things, to: a) the one-time receipt of a settlement of a lease
guarantee obligation in the second quarter of fiscal 2007
in the amount of $6 million, b) an increase in general and
administrative expenses, c) an increase in preferred stock
dividends in fiscal 2008 as a result of the Company’s $60
million preferred stock sale in March 2008, d) the one-time
expense of offering costs, which were deferred by the
Company, on the redemption of the Company’s Series B
Preferred Stock in the second quarter of fiscal 2008 and e) a
decrease in other income; offset by f) an increase in operating
income as a result of property acquisitions in fiscal 2007 and
2008 and g) a decrease in interest expense principally from
the mortgage refinancing of one of the Company’s
properties at a lower interest rate in October 2007.

The increase in FFO in fiscal 2007 when compared with

fiscal 2006 reflects an increase in operating income from
properties owned during the period and property
acquisitions in fiscal 2007 and fiscal 2006 and the receipt
of $6 million from the settlement of a lease guarantee on
a tenant space in The Dock shopping center in Stratford,
Connecticut. See more detailed explanations which follow.

However, FFO:
• does not represent cash flows from operating activities

in accordance with GAAP (which, unlike FFO,
generally reflects all cash effects of transactions and
other events in the determination of net income); and
• should not be considered an alternative to net income

as an indication of the Company’s performance.

FFO as defined by us may not be comparable to similarly

titled items reported by other real estate investment trusts
due to possible differences in the application of the
NAREIT definition used by such REITs. The table below
provides a reconciliation of net income applicable to
Common and Class A Common Stockholders in accordance
with GAAP to FFO for each of the three years in the period
ended October 31, 2008 (amounts in thousands).

Net Income Applicable to Common and

Class A Common Stockholders

$ 16,147

$ 35,046

$ 15,690

Year Ended October 31,
2006
2007

2008

10,966

10,530

9,981

2,822
509

2,267
564

—
—

40
(11,385)

2,450
557

170
—

$ 30,444

$ 37,062

$ 28,848

$ 44,997
$(33,694)
$(13,857)

$ 49,307
$ 35,429
$(19,457) $(20,129)
$(28,432) $(38,994)

Plus: Real property depreciation
Amortization of tenant

improvements and allowances
Amortization of deferred leasing costs
Depreciation and amortization on

discontinued operations
Less: Gains on sales of properties

Funds from Operations Applicable

to Common and Class A
Common Stockholders

Net Cash Provided by (Used in):

Operating Activities
Investing Activities
Financing Activities

RESULTS OF OPERATIONS

Fiscal 2008 vs. Fiscal 2007

The following information summarizes the Company’s results of operations for the year ended October 31, 2008 and

2007 (amounts in thousands):

Year Ended October 31,

Change Attributable to:

Revenues
Base rents
Recoveries from tenants
Mortgage interest and other

Operating Expenses
Property operating
Property taxes
Depreciation and amortization
General and administrative

Non-Operating Income/Expense
Interest expense
Interest, dividends, and other

investment income

Increase
(Decrease)

%
Change

Property
Acquisitions

Properties Held
In Both Periods

$3,748
1,278
4

828
1,133
932
874

6.5%
7.2%
0.5%

6.8%
10.4%
6.9%
17.6%

(761)

(183)

(9.8)%

(36.7)%

$2,276
620
2

747
455
656
n/a

441

n/a

$ 1,472
658
2

81
678
276
n/a

(1,202)

n/a

2008

$61,008
18,938
849

12,937
12,059
14,374
5,853

7,012

318

2007

$57,260
17,660
845

12,109
10,926
13,442
4,979

7,773

501

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Operating Expenses

Operating expense increases were a result of property

acquisitions as discussed above and properties held in
both periods as more fully discussed below:

Property operating expenses for properties held in both
periods were relatively unchanged in the fiscal year ended
October 31, 2008 when compared to fiscal 2007.

Property taxes for properties held in both periods increased

by $678,000 or 6.3% in fiscal 2008 from higher real estate tax
assessment rates at some of the Company’s properties.

Depreciation and amortization expense increased as a
result of depreciation on the two properties acquired in
fiscal 2007 and the five properties purchased in fiscal 2008.

General and administrative expenses increased by
$874,000 in fiscal 2008 compared fiscal 2007 primarily
due to an increase in employee compensation costs,
professional fees of $276,000 and employment placement
fees of $79,000.

Non-Operating Income/Expense

Interest, dividends and other investment income
decreased by $183,000 in fiscal 2008 compared to fiscal
2007. This decrease is a result of the use of available cash
in 2008 primarily for property acquisitions as well as the
repurchase of Class A Common Stock under the
Company’s Share Repurchase Program.

Interest expense decreased $761,000 in fiscal 2008 when
compared to fiscal 2007 as a result of scheduled principal
payments on mortgage notes, the refinancing of an
approximately $53 million mortgage at the Company’s
Ridgeway property at a lower rate of interest in the fourth
quarter of fiscal 2007 and the repayment of mortgage notes
of $5.7 million during 2007.

Revenues
Base rents increased by 6.5% to $61.0 million in fiscal 2008
as compared with $57.3 million in the comparable period
of 2007. The increase in base rentals during each period
was attributable to:

Property Acquisitions:

In fiscal 2008, the Company purchased or acquired
interests in five properties totaling 205,500 square feet of
GLA (compared to two retail properties totaling 102,100
square feet of GLA acquired in fiscal 2007). These properties
accounted for all of the revenue and expense changes
attributable to property acquisitions during the fiscal
year ended 2008.

Properties Held in Both Periods:

The increase in base rents for properties held in both
periods during the fiscal year ended October 31, 2008
compared to the same periods in fiscal 2007 reflects an
increase in rental rates for in-place leases and new leases
entered into over the periods offset by an increase in
vacancies occurring during fiscal 2007 and fiscal 2008 at
several of the Company’s core properties. During fiscal
2008, the Company leased or renewed approximately
303,000 square feet (or approximately 8.0% of total
property leasable area) at an approximate rental rate
increase of 11%. At October 31, 2008, the Company’s core
properties were approximately 94% leased. The overall
core property occupancy rate decreased from 95.4% at
October 31, 2007 to 92.7% at October 31, 2008.

For the fiscal year ended 2008, recoveries from tenants
for properties owned in both periods (which represents
reimbursements from tenants for operating expenses and
property taxes) increased by $658,000 when compared to
the same period in fiscal 2007. The increase was a result of
an increase in property tax expense recoverable from
tenants for the period when compared to the corresponding
period of the prior year caused by an approximate 6.3%
increase in property tax expense in properties held in
both periods. Recoveries from tenants for common area
maintenance were relatively unchanged in fiscal 2008
when compared with fiscal 2007.

The Company’s single largest real estate investment
is the Ridgeway Shopping Center located in Stamford,
Connecticut (which is owned by a consolidated joint
venture in which the Company has a 90% controlling
interest). Ridgeway’s revenues represented approximately
$12.0 million or 15% of total revenues in fiscal 2008
compared to $11.0 million or 14.0% of total revenues in
fiscal 2007. At October 31, 2008, the property was
approximately 99% leased. No other property in the
Company’s portfolio comprised more than 10% of the
Company’s consolidated revenues in fiscal 2008.

URSTADT BIDDLE PROPERTIES INC.

Fiscal 2007 vs. Fiscal 2006

Revenues
Base rents
Recoveries from tenants
Mortgage interest and other

Operating Expenses
Property operating
Property taxes
Depreciation and amortization
General and administrative

Non-Operating Income/Expense
Interest expense
Interest, dividends, and other

investment income

Year Ended October 31,

Change Attributable to:

2007

2006

Increase
(Decrease)

%
Change

Property
Acquisitions

Properties Held
In Both Periods

$57,260
17,660
845

12,109
10,926
13,442
4,979

7,773

501

$54,862
16,957
408

11,666
10,262
13,073
4,981

8,287

950

$2,398
703
437

4.4%
4.1%
107.1%

$1,216
483
11

443
664
369
(2)

(514)

(449)

3.8%
6.5%
2.8%
—

(6.2)%

(47.3)%

253
270
407
n/a

—

n/a

$1,182
220
426

190
394
(38)
n/a

(514)

n/a

Revenues

Base rents increased by 4.4% to $57.3 million in fiscal
2007 as compared with $54.9 million in the comparable
period of 2006. The increase in base rentals was
attributable to the property acquisitions and properties
held in both periods as discussed below.

Property Acquisitions:

In fiscal 2007, the Company acquired two properties
totaling 102,100 square feet of GLA (compared with three
properties totaling 50,000 square feet of GLA in fiscal
2006). These properties accounted for all of the revenue,
operating expense, property tax, and depreciation and
amortization changes attributable to property acquisitions
during the fiscal year ended 2007.

Properties Held in Both Periods:

The increase in base rents for properties held during the

fiscal year ended October 31, 2007 reflects an increase in
rental rates for in-place leases over the period. In fiscal 2007,
the Company leased or renewed approximately 553,000
square feet (or approximately 15% of total property leasable
area). At October 31, 2007, the Company’s core properties
were approximately 96% leased. Overall core property
occupancy rates increased from 93.3% at October 31, 2006
to 95.4% at October 31, 2007.

For the fiscal year ended 2007, recoveries from tenants
for properties owned in both periods (which represents
reimbursements from tenants for operating expenses and
property taxes) increased by $220,000 compared to the same
period in fiscal 2006. This increase was a result of an increase
in real estate tax recoveries caused by an approximate 4.0%
increase in property tax expense in properties held in both
periods and higher property tax recovery rates at certain
properties. Recoveries from tenants for common area
maintenance was unchanged in fiscal 2007 when compared
with fiscal 2006.

During fiscal 2007, the Company executed a settlement

agreement with the corporate guarantor of a former
tenant’s lease obligations whereby the guarantor was
released from its obligations to the Company in exchange
for a payment of $6 million. The payment and release of
guaranty were subject to certain conditions contained in
the agreement. The conditions were satisfied on April 15,
2007 and the payment was recorded as income from a
settlement of lease guaranty obligation in the fiscal year
ended October 31, 2007.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

INFLATION

The Company’s long-term leases contain provisions to
mitigate the adverse impact of inflation on its operating
results. Such provisions include clauses entitling the
Company to receive (a) scheduled base rent increases and
(b) percentage rents based upon tenants’ gross sales, which
generally increase as prices rise. In addition, many of the
Company’s non-anchor leases are for terms of less than ten
years, which permits the Company to seek increases in
rents upon renewal at then current market rates if rents
provided in the expiring leases are below then existing
market rates. Most of the Company’s leases require tenants
to pay a share of operating expenses, including common
area maintenance, real estate taxes, insurance and utilities,
thereby reducing the Company’s exposure to increases in
costs and operating expenses resulting from inflation.

ENVIRONMENTAL MATTERS

Based upon management’s ongoing review of its

properties, management is not aware of any environmental
condition with respect to any of the Company’s properties
that would be reasonably likely to have a material adverse
effect on the Company. There can be no assurance, however,
that (a) the discovery of environmental conditions, which
were previously unknown, (b) changes in law, (c) the
conduct of tenants or (d) activities relating to properties in
the vicinity of the Company’s properties, will not expose
the Company to material liability in the future. Changes in
laws increasing the potential liability for environmental
conditions existing on properties or increasing the
restrictions on discharges or other conditions may result in
significant unanticipated expenditures or may otherwise
adversely affect the operations of the Company’s tenants,
which could adversely affect the Company’s financial
condition and results of operations.

Operating Expenses

Operating expense increases were a result of property

acquisitions as discussed above and properties held in
both periods as more fully discussed below:

Property operating expenses for properties held in both
periods increased $190,000 in the fiscal year ended October 31,
2007 primarily as a result of increased utility costs and repairs
to utility systems, landscaping at some of the Company’s
properties, and parking area maintenance expenses.

Property taxes for properties held in both periods increased

by $394,000 or 4.0% in fiscal 2007 from higher real estate
tax assessment rates at the Company’s properties.

There was relatively no change in depreciation and
amortization for properties held in both periods for the
fiscal year ended October 31, 2007 when compared to
fiscal 2006.

General and administrative expenses were unchanged

for the fiscal year ended October 31, 2007.

Non-Operating Income/Expense

Interest, dividends and other investment income decreased

by $449,000 in the fiscal period ended October 31, 2007.
The decrease in this component of income reflects the use
of available cash in 2006 that was invested in highly liquid
securities for the purchase of properties during fiscal 2006
and 2007.

Interest expense decreased by $514,000 in fiscal 2007
from scheduled principal payments on mortgage notes,
the repayments of mortgage notes of $5,700,000 and
$4,975,000 during fiscal 2007 and 2006, respectively, and a
decrease in credit line facility fees after the termination of
the Company’s unsecured revolving bank credit line in
June 2006.

DISCONTINUED OPERATIONS

In fiscal 2007, the Company sold its Tempe, Arizona
property for a sale price of $13.2 million. Accordingly,
the operating results for this property were classified
as discontinued operations in the accompanying
consolidated statements of income for the year ended
October 31, 2007 and 2006. In connection with the sale
of the property, the Company recorded a gain on sale of
approximately $11.4 million in fiscal 2007.

Revenues from discontinued operations were $320,000

and $747,000 for the years ended October 31, 2007 and
2006, respectively.

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of the Company is responsible for establishing and maintaining adequate internal control over financial

reporting as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. The
Company’s internal control over financial reporting is a process designed by, or under the supervision of, the Company’s
Chief Executive Officer and Chief Financial Officer and effected by the Company’s Board of Directors, management and
other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements in accordance with generally accepted accounting principles.

The Company’s internal control over financial reporting includes policies and procedures that: relate to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of assets of the Company;
provide reasonable assurance of the recording of all transactions necessary to permit the preparation of the Company’s
consolidated financial statements in accordance with generally accepted accounting principles and the proper authorization
of receipts and expenditures in accordance with authorization of the Company’s management and directors; and provide
reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the
Company’s assets that could have a material effect on the Company’s consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projection of any evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of October 31, 2008.

In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission (“COSO”) in Internal Control—Integrated Framework. Based on its assessment, management
determined that the Company’s internal control over financial reporting was effective as of October 31, 2008. The Company’s
independent registered public accounting firm, PKF, has issued an attestation report regarding the Company’s internal
control over financial reporting, which report is included on the following page.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of Urstadt Biddle Properties Inc.

We have audited Urstadt Biddle Properties Inc.’s internal control over financial reporting as of October 31, 2008,

based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (the “COSO criteria”). Urstadt Biddle Properties Inc.’s management is
responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness
of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control
Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial
reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United

States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining
an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing
and evaluating the design and operating effectiveness of internal control based on the assessed risk and performing such
other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis
for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A company’s internal control over financial reporting includes those policies
and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles; (3) that receipts and expenditures of the company are being made only in accordance with authorizations
of management and directors of the company; and (4) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on
the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,

projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Urstadt Biddle Properties Inc. maintained, in all material respects, effective internal control over financial

reporting as of October 31, 2008 based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States), the consolidated balance sheet of Urstadt Biddle Properties Inc. as of October 31, 2008 and 2007, and the related
consolidated statements of income, stockholders’ equity, and cash flows for each of the three years then ended and our
report dated January 9, 2009 expressed an unqualified opinion thereon.

New York, New York
January 9, 2009

PKF
Certified Public Accountants
A Professional Corporation

TAX STATUS

The Company has elected to be treated as a real estate investment trust under the Internal Revenue Code.
Thus, generally it will be subject to federal income taxes only on that part of its taxable income not distributed
as dividends so long as 90% of such taxable income is distributed. The Company has distributed all of its taxable
income for fiscal 2008 and, accordingly, no provision has been made for federal income taxes.

INCOME TAX INFORMATION

The tax status for federal income tax purposes of the dividends paid by the Company during fiscal 2008 is

as follows:

Common and Class A Common Shares:

Dividend
Payment Date
January 18, 2008
April 18, 2008
July 18, 2008
October 17, 2008

Total

Preferred Shares:*

Dividend
Payment Date
January 31, 2008
April 30, 2008
July 31, 2008
October 31, 2008

Total

Common Share

Class A Common Share

Gross
Dividend
Paid
Per Share
$.2150
$.2150
$.2150
$.2150
$.86

Ordinary
Income
$.159
$.159
$.159
$.159
$.636

Non-
Taxable
Portion
$.056
$.056
$.056
$.056
$.224

Gross
Dividend
Paid
Per Share
$.2375
$.2375
$.2375
$.2375
$.95

Ordinary
Income
$.175
$.175
$.175
$.175
$.700

Non-
Taxable
Portion
$.0625
$.0625
$.0625
$.0625
$.250

Series B
Preferred Share
$2.2475
$1.0488
$ —
$ —
$3.2963

Series E

Series C

Series D
Preferred Share Preferred Share Preferred Share
$ .46875
$ .46875
$ .46875
$ .46875
$1.875

$ —
$ .28333
$ .53125
$ .53125
$1.34583

$2.1250
$2.1250
$2.1250
$2.1250
$8.50

*All dividends paid during 2008 on shares of Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock and Series E Preferred Stock were
ordinary income for federal income tax purposes.

MARKET PRICE RANGES

The following sets forth, for the fiscal years ended October 31, 2008 and 2007, the low and high closing sales

price per Common Share and Class A Common Share as quoted on The New York Stock Exchange.

Common Shares and Class A Common Shares trade on the New York Stock Exchange under the Symbols:

“UBP” and “UBA.”

Common Shares:
First Quarter
Second Quarter
Third Quarter
Fourth Quarter

Class A Common Shares:
First Quarter
Second Quarter
Third Quarter
Fourth Quarter

Fiscal 2008
Low

High

$13.69 – $18.38
$14.10 – $17.84
$14.76 – $18.14
$12.91 – $18.41

$13.75 – $18.13
$13.38 – $17.71
$14.42 – $17.64
$12.79 – $19.04

Fiscal 2007

Low

High

$16.70 – $18.25
$17.02 – $18.46
$16.35 – $18.45
$16.15 – $18.31

$17.82 – $19.43
$17.81 – $19.62
$15.10 – $18.81
$14.97 – $17.91

PERFORMANCE GRAPH

The following graph compares, for the five-year period beginning October 31, 2003 and ended October 31, 2008,
the Company’s cumulative total return to holders of the Company’s Class A Common Shares and Common Shares
with the returns for the NAREIT All—REIT Total Return Index (a peer group index) published by the National
Association of Real Estate Investment Trusts (NAREIT) and for the S&P 500 Index for the same period.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among Urstadt Biddle Properties Inc., The S&P 500 Index
And The FTSE NAREIT All Index

$250

$200

$150

$100

$50

10/03

10/04

10/05

10/06

10/07

10/08

Urstadt Biddle Properties Inc.

Urstadt Biddle Properties Inc.—Class A

S&P 500

FTSE NAREIT All

*$100 invested on 10/31/03 in stock & index-including reinvestment of dividends. Fiscal year ending October 31.

Urstadt Biddle Properties Inc.
Urstadt Biddle Properties Inc.—Class A
S&P 500
FTSE NAREIT All

10/03
100.00
100.00
100.00
100.00

10/04
123.15
125.67
109.42
128.52

10/05
147.25
136.66
118.96
146.63

10/06
161.54
166.15
138.40
198.77

10/07
161.03
152.06
158.56
192.96

10/08
156.13
154.24
101.32
116.12

The stock price performance shown on the graph is not necessarily indicative of future price performance.

CERTIFICATIONS

Following the March 2008 annual meeting of shareholders, the annual certification of the Chief Executive Officer

regarding compliance by the Company with the corporate governance listing standards of the New York Stock
Exchange (“NYSE”) was submitted without qualification to the NYSE. In addition, as required by the Sarbanes-Oxley
Act of 2002, the Company filed with the Securities and Exchange Commission the CEO and CFO certifications
regarding the quality of the Company’s public disclosure as Exhibits 31.1 and 31.2 to its Annual Report on Form 10-K
for the year ended October 31, 2008.

URSTADT BIDDLE PROPERTIES INC.

DIRECTORS
CHARLES J. URSTADT
Chairman, Urstadt Biddle Properties Inc.

ROBERT R. DOUGLASS
Vice Chairman, Urstadt Biddle Properties Inc.
Of Counsel, Milbank, Tweed, Hadley and McCloy

WILLING L. BIDDLE
President, Urstadt Biddle Properties Inc.

E. VIRGIL CONWAY
Retired Chairman, New York State Metropolitan
Transportation Authority

PETER HERRICK
Retired Vice Chairman, The Bank of New York

GEORGE H.C. LAWRENCE
Chairman and Chief Executive Officer
Lawrence Properties

ROBERT J. MUELLER
Retired Senior Executive Vice President
The Bank of New York

CHARLES D. URSTADT
President
Urstadt Property Company, Inc.

GEORGE J. VOJTA
Retired Vice Chairman
Bankers Trust Company

KEVIN J. BANNON
Managing Director,
Highmount Capital LLC

DIRECTORS EMERITI
GEORGE M. HUBBARD, JR.
JAMES O. YORK

OFFICERS
CHARLES J. URSTADT
Chairman and Chief Executive Officer

WILLING L. BIDDLE
President and Chief Operating Officer

JOHN T. HAYES
Senior Vice President, Chief Financial Officer
and Treasurer

THOMAS D. MYERS
Senior Vice President, Chief Legal Officer and Secretary

JAMES M. ARIES
Senior Vice President, Acquisitions and Leasing

LINDA L. LACEY
Senior Vice President, Leasing

WAYNE W. WIRTH
Senior Vice President, Management

LUISA CAYCEDO-KIMURA
Vice President and Assistant Secretary

DIANE MIDOLLO
Vice President, Controller

STEPHAN RAPAGLIA
Vice President, Real Estate Counsel

ANDREW ALBRECHT
Assistant Vice President, Management

HEIDI R. BRAMANTE
Assistant Vice President and Assistant Controller

JOHN GRILLO
Assistant Vice President, Management

SUZANNE MOORE
Assistant Vice President, Billing

Securities Traded
New York Stock Exchange
Symbols: UBA, UBP, UBPPRC and UBPPRD
Stockholders of Record as of December 31, 2008:
Common Stock: 1,118 and Class A Common Stock: 1,121

Annual Meeting
The annual meeting of stockholders will be held
at 2:00 P.M. on March 5, 2009 at Doral Arrowwood,
Rye Brook, New York.

Form 10-K
A copy of the Company’s 2008 Annual Report on Form 10-K
filed with the Securities and Exchange Commission may be
obtained by stockholders without charge by writing to the
Secretary of the Company at its executive office.

Shareholder Information and Dividend
Reinvestment Plan
Inquiries regarding stock ownership, dividends or the
transfer of shares can be made by writing to our Transfer
Agent, The Bank of New York Mellon, Shareowner Services
Department, P.O. Box 11258, New York, NY 10286-1258 or
by calling toll-free at 1-800-524-4458. The Company has a
dividend reinvestment plan which provides stockholders
with a convenient means of increasing their holdings
without incurring commissions or fees. For information
about the plan, stockholders should contact the Transfer
Agent. Other shareholder inquiries should be directed to
Thomas D. Myers, Secretary, telephone (203) 863-8200.

Investor Relations
Investors desiring information about the Company can
contact Athena Bludé, Investor Relations, telephone
(203) 863-8200. Investors are also encouraged to visit our
website at: www.ubproperties.com

Independent Registered Public Accounting Firm
PKF, Certified Public Accountants, A Professional Corporation

General Counsel
Baker & McKenzie LLP

Internal Audit
Berdon LLP, CPAs and Advisors

Executive Office of the Company
321 Railroad Avenue
Greenwich, CT 06830
Tel: (203) 863-8200
Fax: (203) 861-6755
Web site: www.ubproperties.com

Memberships
National Association of Real Estate Investment Trusts, Inc.
(NAREIT)
International Council of Shopping Centers (ICSC)

Emerson Shopping Plaza Emerson, New Jersey

321 RAILROAD AVENUE
GREENWICH, CONNECTICUT 06830