MacKenzie Realty Capital, Inc. - FORM 10-Q

Attached files

file	filename
EX-31.2 - SECTION 302 CERTIFICATION OF PAUL KOSLOSKY (TREASURER AND CHIEF FINANCIAL OFFICE - MacKenzie Realty Capital, Inc.	ex31-2.htm
EX-32.2 - SECTION 1350 CERTIFICATION OF PAUL KOSLOSKY (TREASURER AND CHIEF FINANCIAL OFFIC - MacKenzie Realty Capital, Inc.	exh32-2.htm
EX-32.1 - SECTION 1350 CERTIFICATION OF ROBERT DIXON (PRESIDENT AND CHIEF EXECUTIVE OFFICE - MacKenzie Realty Capital, Inc.	ex32-1.htm
EX-31.1 - SECTION 302 CERTIFICATION OF ROBERT DIXON (PRESIDENT AND CHIEF EXECUTIVE OFFICER - MacKenzie Realty Capital, Inc.	ex31-1.htm

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

Form 10-Q

(Mark one)
☑	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2016

☐	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to __________

Commission file number 000-55006

MacKenzie Realty Capital, Inc.
(Exact name of registrant as specified in its charter)

Maryland		45-4355424
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1640 School Street, Moraga, California 94556
(Address of principal executive offices)

(925) 631-9100
(Registrant's telephone number, including area code)

________________________________________________________________
(Former name, former address and former fiscal year, if changed since last report)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 or Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.) Yes ☐ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☑ Smaller reporting company ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
The number of the shares of issuer's Common Stock outstanding as of December 5, 2016 was 4,954,030.68.

TABLE OF CONTENTS

		Page
PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)

	Statements of Assets and Liabilities as of September 30, 2016 (Unaudited) and June 30, 2016	1

	Schedule of Investments as of September 30, 2016 (Unaudited)	2

	Schedule of Investments as of June 30, 2016	3

	Statements of Operations for the three months ended September 30, 2016 and 2015 (Unaudited)	4

	Statements of Changes in Net Assets for the three months ended September 30, 2016 (Unaudited), and the year ended June 30, 2016	5

	Statements of Cash Flows for the three months ended September 30, 2016 and 2015 (Unaudited)	6

	Notes to Financial Statements	7

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24

Item 4.	Controls and Procedures	24

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	25

Item 1A.	Risk Factors	25

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25

Item 3.	Defaults Upon Senior Securities	25

Item 4.	Mine Safety Disclosures	25

Item 5.	Other Information	25

Item 6.	Exhibits	26

SIGNATURES		27

Table of Contents

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

MacKenzie Realty Capital, Inc.

Statements of Assets and Liabilities

	September 30, 2016			June 30, 2016
	(Unaudited)
Investments, at fair value (cost of $40,475,941 and $37,077,138, respectively)	$	43,327,713		$	39,176,772
Cash and cash equivalents		4,645,491			2,350,435
Accounts receivable		381,354			438,956
Other assets		217,065			349,058
Deferred offering costs		279,117			-
Total assets	$	48,850,740		$	42,315,221


Liabilities
Accounts payable and accrued liabilities	$	258,402		$	90,956
Capital pending acceptance		845,200			1,616,490
Due to related entities		239,781			230,221
Deferred tax liability		45,363			45,363
Total liabilities		1,388,746			1,983,030


Net assets
Common stock, $0.0001 par value, 80,000,000 shares authorized; 4,478,320.68 and 4,057,319.49 shares issued and outstanding, respectively		475			406
Capital in excess of par value		43,475,167			37,256,225
Accumulated undistributed net investment loss		(535,407	)		(619,875	)
Accumulated undistributed net realized gain		1,669,988			1,595,801
Accumulated undistributed net unrealized gain		2,851,771			2,099,634
Total net assets		47,461,994			40,332,191

Total liabilities and net assets	$	48,850,740		$	42,315,221

Net asset value per Share		10.00		$	9.94

The accompanying Notes to Financial Statements are an integral part of these financial statements.

Table of Contents

MacKenzie Realty Capital, Inc.

Schedule of Investments

September 30, 2016

(Unaudited)

Name			Asset Type	Shares/Units		Cost Basis		Total Fair Value		% of Net Assets
Ambase Corporation	(5	)	Publicly Traded Company		250,000.00	$	424,397	$	265,000		0.56
Apple Hospitality REIT, Inc.			Publicly Traded Company		203,574.00		3,855,692		3,768,155		7.94
Ashford Hospitality Prime, Inc.	(3	)	Publicly Traded Company		54,027.00		795,610		761,781		1.61
Ashford Hospitality Trust, Inc.	(3	)	Publicly Traded Company		150,000.00		912,218		883,500		1.86
Bluerock Residential Growth REIT, Inc.			Publicly Traded Company		147,858.00		1,621,715		1,922,154		4.05
CBL & Associates Properties, Inc.	(3	)	Publicly Traded Company		74,000.00		929,327		898,360		1.89
Chatham Lodging Trust	(3	)	Publicly Traded Company		30,000.00		663,653		577,500		1.22
Equity Commonwealth	(3	)(5)	Publicly Traded Company		12,150.00		311,114		367,173		0.77
Independence Realty Trust, Inc.	(3	)	Publicly Traded Company		72,000.00		542,232		648,000		1.37
Liberty Property Trust	(3	)	Publicly Traded Company		14,000.00		474,607		564,900		1.19
New York REIT, Inc.	(3	)	Publicly Traded Company		87,000.00		939,475		796,050		1.68
One Liberty Properties, Inc.	(3	)	Publicly Traded Company		22,500.00		510,055		543,600		1.15
Sabra Health Care REIT, Inc.	(3	)	Publicly Traded Company		26,300.00		538,275		662,234		1.40
TIER REIT, Inc.			Publicly Traded Company		55,000.00		713,455		849,200		1.79
VEREIT Inc.	(3	)	Publicly Traded Company		126,800.00		1,104,741		1,314,916		2.77
Washington Prime Group Inc.	(3	)	Publicly Traded Company		30,000.00		374,993		371,400		0.78
Total Publicly Traded Company							14,711,559		15,193,923		32.03

American Finance Trust, Inc.	(4	)	Non Traded Company		26,879.51		469,595		470,390		0.99
American Realty Capital New York City REIT, Inc.	(4	)	Non Traded Company		936.48		16,257		16,257		0.02
Behringer Harvard REIT I	(4	)(5)	Non Traded Company		151,809.21		163,954		212,533		0.45
FSP Energy Tower	(4	)(5)	Non Traded Company		7.00		294,350		240,616		0.51
FSP Grand Boulevard	(4	)	Non Traded Company		7.00		279,104		280,736		0.59
FSP 1441 Main Street	(4	)	Non Traded Company		11.55		398,163		424,078		0.89
FSP Satellite Place	(4	)	Non Traded Company		5.00		195,035		192,213		0.40
FSP South 10th Street Corp. Liquidating Trust	(4	)(5)	Non Traded Company		0.25		151		-		-
Highlands REIT Inc.	(4	)	Non Traded Company		2,084,327.91		508,857		458,552		0.97
InvenTrust Properties Corp.	(4	)	Non Traded Company		2,031,268.94		4,262,262		3,696,909		7.79
KBS Real Estate Investment Trust, Inc.	(4	)	Non Traded Company		1,474,273.09		3,360,656		4,186,936		8.82
Phillips Edison Grocery Center REIT I, Inc	(4	)	Non Traded Company		1,950.00		17,439		17,375		0.04
Sentio Healthcare Properties, Inc.	(4	)	Non Traded Company		19,473.95		143,822		172,150		0.36
Strategic Realty Trust, Inc.	(4	)	Non Traded Company		42,288.14		167,662		195,794		0.41
Summit Healthcare REIT, Inc.	(4	)(5)	Non Traded Company		181,986.39		209,750		242,042		0.51
Total Non Traded Company (1)							10,487,057		10,806,581		22.75

5210 Fountaingate	(4	)(5)	LP Interest		9.89		500,000		500,000		1.01
Arrowpoint Burlington LLC	(4	)	LP Interest		7.50		750,000		761,805		1.61
BR Beach House Investment Co	(4	)	LP Interest		1,499,804.92		1,499,805		1,559,797		3.29
BR Cabrillo LLC	(4	)(5)	LP Interest		346,723.32		104,942		104,017		0.22
BR Riverside Investment	(4	)	LP Interest		2,237,500.00		2,238,638		2,304,625		4.86
Britannia Preferred Members, LLC	(4	)(5)	LP Interest		150,000.00		1,500,000		1,899,000		4.00
DRV Holding Company, LLC	(4	)(5)	LP Interest		250.00		250,000		353,418		0.74
Inland Land Appreciation Fund II, L.P.	(4	)(5)	LP Interest		210.97		8,667		25,840		0.05
MC 15 Preferred Equity, LLC	(4)	)(5)(2)	LP Interest		250,000.00		2,500,000		2,810,000		5.92
MPF Pacific Gateway - Class B	(2)	)(4)(5)	LP Interest		23.20		6,287		7,309		0.02
Rancon Realty Fund IV	(4	)(5)	LP Interest		5,408.97		50,617		49,979		0.11
Redwood Mortgage Investors VIII	(4	)	LP Interest		53,848.09		29,020		32,847		0.07
Resource Real Estate Investors 6, L.P.	(4	)	LP Interest		42,600.00		169,548		198,516		0.42
Resource Real Estate Investors 7 L.P.	(4	)	LP Interest		11,500.00		36,820		114,425		0.24
Satellite Investment Holdings, LLC - Class A	(4	)	LP Interest		22.00		2,200,000		2,200,000		4.64
Secured Income, LP	(4	)(5)	LP Interest		64,177.00		560,403		790,661		1.67
Strategic Realty Operating Partnership, LP	(4	)	LP Interest		20,433.01		78,951		94,605		0.20
The Weatherly, LTD	(4	)(5)	LP Interest		60.00		672,000		703,288		1.48
The Weatherly Building, LLC	(4	)(5)	LP Interest		17.50		392,000		410,252		0.86
Uniprop Manufactured Housing Income Fund II, LP	(4	)	LP Interest		124,917.00		646,191		1,044,306		2.20
VWC Savannah, LLC	(4	)(5)	LP Interest		8.25		825,000		1,170,458		2.47
Total LP Interest							15,018,889		17,135,148		36.08

Coastal Realty Business Trust, REEP, Inc. - A	(2)	)(4)(5)	Investment Trust		72,320.00		73,555		102,694		0.22
Coastal Realty Business Trust, Series H2- A	(2	)(4)	Investment Trust		47,284.16		184,881		89,367		0.18
Total Investment Trust							258,436		192,061		0.40

Total Investments						$	40,475,941	$	43,327,713		91.26

(1) Investments primarily in non-traded public REITs or their successors.

(2) Investments in affiliated companies. See additional disclosures in note 5.

(3) Non-qualifying assets under Section 55(a) of the 1940 Act. As of September 30, 2016, the total percentage of non-qualifying assets is 17.17%, and as a business development company non-qualifying assets may not exceed 30% of our total assets.

(4) Investments in illiquid securities, or securities that are not traded on a national exchange. As of September 30, 2016, 57.59% of the Company's total assets are in illiquid securities.

(5) Investments in non-income producing securities. As of September 30, 2016, 20.99% of the Company's total assets are in non-income producing securities.

The accompanying Notes to Financial Statements are an integral part of these financial statements.

Table of Contents

MacKenzie Realty Capital, Inc.

Schedule of Investments

June 30, 2016

Name			Asset Type	Shares/Units		Cost Basis		Total Fair Value		% of Net Assets
Ambase Corporation	(5	)	Publicly Traded Company		250,000.00	$	424,397	$	357,500		0.88
Ashford Hospitality Prime, Inc.	(3	)	Publicly Traded Company		54,027.00		795,610		763,942		1.90
Ashford Hospitality Trust, Inc.	(3	)	Publicly Traded Company		150,000.00		912,218		805,500		2.00
Bluerock Residential Growth REIT, Inc.			Publicly Traded Company		147,858.00		1,621,715		1,922,154		4.77
CBL & Associates Properties, Inc.	(3	)	Publicly Traded Company		54,000.00		646,753		502,740		1.25
Chatham Lodging Trust	(3	)	Publicly Traded Company		15,000.00		323,032		329,700		0.82
Equity Commonwealth	(3	)(5)	Publicly Traded Company		12,150.00		311,114		353,930		0.88
Independence Realty Trust, Inc.	(3	)	Publicly Traded Company		72,000.00		542,232		588,960		1.46
Liberty Property Trust	(3	)	Publicly Traded Company		14,000.00		474,607		556,080		1.38
New York REIT, Inc.	(3	)	Publicly Traded Company		72,000.00		789,642		666,000		1.65
One Liberty Properties, Inc.	(3	)	Publicly Traded Company		22,500.00		510,055		536,625		1.33
Sabra Health Care REIT, Inc.	(3	)	Publicly Traded Company		26,300.00		538,275		542,832		1.35
TIER REIT, Inc.			Publicly Traded Company		147,649.00		1,922,622		2,263,459		5.62
VEREIT Inc.	(3	)	Publicly Traded Company		126,800.00		1,104,741		1,285,752		3.19
Total Publicly Traded Companies							10,917,013		11,475,174		28.48

American Finance Trust, Inc.	(4	)	Non Traded Company		12,948.60		235,213		242,657		0.60
Apple REIT Ten, Inc.	(4	)	Non Traded Company		260,641.12		2,410,057		2,820,137		7.00
American Realty Capital New York City REIT, Inc.	(4	)	Non Traded Company		936.48		16,257		16,257		0.04
FSP Energy Tower	(4	)(5)	Non Traded Company		7.00		294,350		225,132		0.56
FSP Grand Boulevard	(4	)	Non Traded Company		7.00		279,104		294,021		0.73
FSP 1441 Main Street	(4	)	Non Traded Company		11.55		398,163		415,800		1.03
FSP Satellite Place	(4	)	Non Traded Company		5.00		195,035		176,836		0.44
FSP South 10th Street Corp. Liquidating Trust	(4	)(5)	Non Traded Company		0.25		151		-		-
Highlands REIT Inc.	(4	)	Non Traded Company		1,902,983.81		463,329		418,656		1.04
InvenTrust Properties Corp.	(4	)	Non Traded Company		1,940,749.73		4,106,446		3,376,905		8.38
KBS Real Estate Investment Trust, Inc.	(4	)	Non Traded Company		1,171,821.66		2,676,386		3,245,946		8.06
Phillips Edison Grocery Center REIT I, Inc	(4	)	Non Traded Company		1,950.00		17,439		17,394		0.04
Sentio Healthcare Properties, Inc.	(4	)	Non Traded Company		13,039.18		91,663		118,265		0.29
Strategic Realty Trust, Inc.	(4	)	Non Traded Company		5,245.47		24,406		23,237		0.06
Summit Healthcare REIT, Inc.	(4	)(5)	Non Traded Company		171,494.39		198,587		217,798		0.54
Total Non Traded Companies (1)							11,406,586		11,609,041		28.81

Arrowpoint Burlington LLC	(4	)	LP Interest		7.50		750,000		750,000		1.86
BR Beach House Investment Co	(4	)	LP Interest		1,499,804.92		1,499,805		1,499,805		3.72
BR Riverside Investment	(4	)	LP Interest		2,237,500.00		2,238,638		2,237,500		5.55
Britannia Preferred Members, LLC	(4	)(5)	LP Interest		150,000.00		1,500,000		1,899,000		4.71
DRV Holding Company, LLC	(4	)(5)	LP Interest		250.00		250,000		353,418		0.88
Inland Land Appreciation Fund II, L.P.	(4	)(5)	LP Interest		210.97		8,667		24,046		0.06
MC 15 Preferred Equity, LLC	(4)	)(5)(2)	LP Interest		250,000.00		2,500,000		2,500,000		6.20
MPF Pacific Gateway - Class B	(2)	)(4)(5)	LP Interest		23.20		6,287		7,309		0.02
Rancon Realty Fund IV	(4	)(5)	LP Interest		1,016.00		184,474		185,085		0.46
Redwood Mortgage Investors VIII	(4	)	LP Interest		54,129.40		29,169		33,019		0.08
Resource Real Estate Investors 6, L.P.	(4	)	LP Interest		42,600.00		169,548		169,974		0.42
Resource Real Estate Investors 7 L.P.	(4	)	LP Interest		11,500.00		36,820		48,645		0.12
Satellite Investment Holdings, LLC - Class A	(4	)	LP Interest		22.00		2,200,000		2,200,000		5.46
Secured Income, LP	(4	)(5)	LP Interest		64,177.00		560,403		765,632		1.90
The Weatherly, LTD	(4	)(5)	LP Interest		60.00		672,000		675,378		1.68
The Weatherly Building, LLC	(4	)(5)	LP Interest		17.50		392,000		393,970		0.98
Uniprop Manufactured Housing Income Fund II, LP	(4	)	LP Interest		113,764.00		567,351		1,006,811		2.50
VWC Savannah, LLC	(4	)(5)	LP Interest		8.25		825,000		1,043,883		2.59
Total LP Interests							14,390,162		15,793,475		39.19

Coastal Realty Business Trust, REEP, Inc. - A	(2)	)(4)(5)	Investment Trust		72,320.00		73,555		99,078		0.25
Coastal Realty Business Trust, Series H2- A	(2	)(4)	Investment Trust		47,284.16		184,880		95,987		0.23
Total Investment Trusts							258,435		195,065		0.48

BR Cabrillo LLC Promissory Note	(4	)(5)	Note				104,942		104,017		0.26
Total Note							104,942		104,017		0.26

Total Investments						$	37,077,138	$	39,176,772		97.22

(1) Investments primarily in non-traded public REITs or their successors.

(2) Investments in affiliated companies. See additional disclosures in note 5.

(3) Non-qualifying assets under Section 55(a) of the 1940 Act. As of June 30, 2016, the total percentage of non-qualifying assets is 16.38%, and as a business development company non-qualifying assets may not exceed 30% of our total assets.

(4) Investments in illiquid securities, or securities that are not traded on a national exchange. As of June 30, 2016, 65.46% of the Company's total assets are in illiquid securities.

(5) Investments in non-income producing securities. As of June 30, 2016, 21.75% of the Company's total assets are in non-income producing securities.

The accompanying Notes to Financial Statements are an integral part of these financial statements.

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MacKenzie Realty Capital, Inc.

Statements of Operations

(Unaudited)

	For The Three Months Ended September 30,
	2016		2015
Investment income
Dividend and distribution income	$	790,329	$	626,166
Interest and other income		-		52,402
Total investment income		790,329		678,568

Operating expenses
Base management fee		287,416		178,887
Portfolio Structuring fee		197,208		111,689
Administrative cost reimbursements		55,000		30,000
Professional fees		116,479		72,728
Other general and administrative		49,758		30,434
Total operating expenses		705,861		423,738

Net investment income		84,468		254,830

Realized and unrealized gain on investments
Net realized gain		1,016,846		328,799
Net unrealized gain		752,137		553,614
Total net realized and unrealized gain on investments		1,768,983		882,413

Income tax benefit (note 2)		-		1,412

Net increase in net assets resulting from operations	$	1,853,451	$	1,138,655

Net increase in net assets resulting from operations per Share	$	0.41	$	0.46

Weighted average common Shares outstanding		4,533,971		2,476,514

The accompanying Notes to Financial Statements are an integral part of these financial statements.

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MacKenzie Realty Capital, Inc.

Statements of Changes in Net Assets

	For The Three Months Ended			For The Year Ended
	September 30, 2016			June 30, 2016
	(Unaudited)
Operations
Net investment income	$	84,468		$	807,987
Net realized gain		1,016,846			2,809,740
Net unrealized gain (loss)		752,137			(16,668	)
Income tax benefit		-			1,412
Net increase in net assets resulting from operations		1,853,451			3,602,471

Dividends
Dividends to stockholders from net realized gain		(942,659	)		(2,377,506	)

Capital share transactions
Issuance of common stock		6,573,620			19,248,674
Issuance of common stock through reinvestment of dividends		463,950			937,158
Redemption of common stock		(161,197	)		(1,526,467	)
Selling commissions and fees		(657,362	)		(1,912,368	)
Net increase in net assets resulting from capital share transactions		6,219,011			16,746,997

Total increase in net assets		7,129,803			17,971,962

Net assets at beginning of the period		40,332,191			22,360,229

Net assets at end of the period	$	47,461,994		$	40,332,191

The accompanying Notes to Financial Statements are an integral part of these financial statements.

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MacKenzie Realty Capital, Inc.

Statements of Cash Flows

(Unaudited)

	For The Three Months Ended September 30,
	2016			2015


Cash flows from operating activities:
Net increase in net assets resulting from operations	$	1,853,451		$	1,138,655
Adjustments to reconcile net increase in net assets resulting from
operations to net cash from operating activities:
Proceeds from sale of investments, net		5,860,847			1,545,423
Return of capital		133,857			1,176
Purchase of investments		(8,376,662	)		(4,324,583	)
Net realized gain on investments		(1,016,846	)		(328,799	)
Net unrealized loss (gain) on investments		(752,137	)		(553,614	)
Changes in assets and liabilities:
Accounts receivable		57,602			(57,691	)
Other assets		110,493			37,830
Deferred offering costs		(279,117	)		-
Accounts payable and accrued liabilities		167,789			82,793
Income tax payable		-			10,980
Due to related entities		9,560			(26,409	)
Deferred tax liability		-			(5,236	)
Net cash from operating activities		(2,231,163	)		(2,479,475	)

Cash flows from financing activities:
Proceeds from issuance of common stock		6,573,620			3,722,968
Redemption of common stock		(161,197	)		-
Dividends to stockholders		(478,709	)		(511,050	)
Payment of selling commissions and fees		(636,205	)		(389,478	)
Change in capital pending acceptance		(771,290	)		(25,020	)
Net cash from financing activities		4,526,219			2,797,420

Net increase in cash and cash equivalents		2,295,056			317,945

Cash and cash equivalents at beginning of the year		2,350,435			4,297,086

Cash and cash equivalents at end of the year	$	4,645,491		$	4,615,031

Non-cash financing activities:
Issuance of common stock through reinvestment of dividends	$	463,950		$	112,344

The accompanying Notes to Financial Statements are an integral part of these financial statements.

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MacKenzie Realty Capital, Inc.

Notes to Financial Statements

September 30, 2016

(Unaudited)

NOTE 1 – PRINCIPAL BUSINESS AND ORGANIZATION

MacKenzie Realty Capital, Inc. (the "Company") was incorporated under the general corporation laws of the State of Maryland on January 25, 2012. It is a non-diversified, closed-end investment company that has elected to be regulated as a business development company ("BDC") under the Investment Company Act of 1940, as amended ("1940 Act"). The Company has elected to be treated as a real estate investment trust ("REIT") as defined under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"). The Company is authorized to issue 100,000,000 shares, of which (i) 80,000,000 are designated as Common Stock, with a $0.0001 par value per share; and (ii) 20,000,000 are designated as Preferred Stock, with a $0.0001 par value per share.

The Company filed its initial registration statement on June 1, 2012, with the Securities and Exchange Commission ("SEC") to register the initial public offering of 5,000,000 shares of the Company's common stock. The initial registration statement was declared effective by the SEC on August 2, 2013, and the offering commenced shortly thereafter. The Company has filed various post-effective amendments since the SEC granted the initial effectiveness for the purpose of updating the Registration Statement. The offering was concluded as of October 28, 2016. The Company commenced its operations on February 28, 2013, and its fiscal year-end is June 30.

The Company is externally managed by MacKenzie Capital Management, LP ("MacKenzie") under the administration agreement dated and effective as of February 28, 2013 (the "Administration Agreement"). MacKenzie manages all of the Company's affairs except for providing investment advice. The Company is advised by MCM Advisers, LP (the "Adviser") under the advisory agreement dated and effective as of February 28, 2013 (the "Investment Advisory Agreement"). The Investment Advisory Agreement was subsequently amended on August 6, 2014, and renewed on October 23, 2014, October 23, 2015, and September 27, 2016. The Company pursues a strategy focused on investing primarily in illiquid or non-traded debt and equity securities issued by U.S. companies generally owning commercial real estate. These companies are likely to be non-traded REITs, small-capitalization publicly traded REITs, public and private real estate limited partnerships, limited liability companies, and tenancies-in-common.

As of September 30, 2016, the Company has raised approximately $41.9 million from the current offering, including proceeds from the dividend reinvestment plan ("DRIP") of approximately $1.5 million.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and pursuant to the requirements for reporting on Form 10-Q and Articles 6 and 10 of Regulation S-X contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the Company's assets and liabilities as of September 30, 2016, and the results of its operations for the three months ended September 30, 2016, and 2015, which results are not necessarily indicative of results on an annualized basis. The statement of assets and liabilities as of June 30, 2016, has been derived from audited financial statements. The Fund follows the GAAP financial reporting standards for investment companies. Accordingly, the Company's investments are recorded at estimated fair value in the statements of assets and liabilities with changes in unrealized gains (losses) in the fair value of such investments included within the Company's statement of operations.

These unaudited financial statements should be read in conjunction with the audited financial statements for the year ended June 30, 2016, included in the Company's annual report on Form 10-K/A filed with the SEC. The original Form 10-K for the year ended June 30, 2016, filed on September 22, 2016, was amended to restate the Company's financial statements along with certain related notes to such restated financial statements and the financial highlights. In addition, the Company restated the unaudited quarterly financial statements reported in the Company's Quarterly Reports on Form 10-Q for the quarterly periods in the years ended June 30, 2016, and 2015 and included in the amended Form 10-K/A. The restatements reflected the correction in accounting treatment of the portfolio structuring fee as an operating expense instead of as a reduction to equity.

Therefore, the amounts disclosed as of and for the year ended June 30, 2016, in the accompanying statements of assets and liabilities and the statements of changes in net assets reflect the restated amounts. Similarly, the three months ended September 30, 2015, in the accompanying statements of operations and statements of cash flow, reflect the restated quarterly amounts.

There have been no changes in the significant accounting policies from those disclosed in the audited financial statements for the year ended June 30, 2016, other than those expanded upon and described below.

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Cash and Cash Equivalents

The Fund considers all highly liquid investments with original maturities of three months or less to be cash equivalents. These balances are insured by the Federal Deposit Insurance Corporation ("FDIC") up to certain limits. At times the cash balances held in financial institutions by the Company may exceed these insured limits. Cash and cash equivalents are carried at cost which approximates fair value. There were no cash equivalents held as of September 30, 2016, and June 30, 2016.

Accounts Receivable

Accounts receivable represent dividends, distributions and sales proceeds recognized in accordance with our revenue recognition policy but not yet received as of the date of the financial statements. The amounts are generally fully collectible as they are recognized based on completed transactions. The Fund monitors and adjusts its receivables and those deemed to be uncollectible are written-off only after all reasonable collection efforts are exhausted. Substantially all of the accounts receivable balance outstanding as of September 30, 2016, has been collected as of the issuance date of this financial statements.

Capital Pending Acceptance

The Fund admits new stockholders monthly and subscriptions are effective only upon the Company's acceptance. Any gross proceeds received from subscriptions which are not accepted as of the period-end are classified as capital pending acceptance in the statements of assets and liabilities. As of September 30, 2016, and June 30, 2016, capital pending acceptance was $845,200 and $1,616,490, respectively.

Organization and Deferred Offering Costs

Organization costs include, among other things, the cost of legal services pertaining to the organization and incorporation of the business, incorporation fees and audit fees relating to the initial registration statement and the initial statement of assets and liabilities. These costs are expensed as incurred. Deferred offering costs include, among other things, legal fees and other costs pertaining to the preparation of the registration statements and pre- and post-effective amendments. These offering costs are deferred and expensed over a twelve month period.

During the quarter ended September 30, 2016, the Company filed a new registration statement with the SEC to register a public offering of 15,000,000 additional shares of the Company's common stock. The registration statement is currently under SEC review. The offering costs incurred on this new registration statement as of September 30, 2016, were $279,117. These offering costs have been deferred and will be expensed over a twelve-month period beginning from the date the registration is declared effective by the SEC.

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Income Taxes and Deferred Tax Liability

The Company has elected to be treated as a REIT for tax purposes under the Code and as a REIT, the Company is not subject to federal income taxes on amounts that it distributes to the stockholders, provided that, on an annual basis, it distributes at least 90% of its REIT taxable income to the stockholders and meets certain other conditions. To the extent that the Company satisfies the annual distribution requirement but distributes less than 100% of its taxable income, it is either subject to U.S. federal corporate income tax on its undistributed taxable income or 4% excise tax on catch-up distributions paid in the subsequent year. The Company is also subject to tax on built-in gains it realizes during the first ten years following REIT election.

The Company satisfied the annual dividend payment and other REIT requirements for the tax years ended December 31, 2015, and 2014. Therefore, the Company did not incur any tax expense or excise tax for those years. For the tax year ended December 31, 2016, we intend to pay the requisite amount of dividends to stockholders such that the Company would not pay any income taxes on its income. Therefore, the Company did not record any income tax provisions during the quarter ended September 30, 2016, and 2015.

The income tax benefit of $1,412 reflected in the statements of operations for the quarter ended September 30, 2015, was the adjustment for the difference between the actual and estimated tax on the built-in gains realized during tax year 2014. Prior to the effective date of its REIT election, the Company had net unrealized built-in gains of $239,595, for which the Company recorded an estimated tax liability of $95,431 as of December 31, 2013. Accordingly, in each subsequent tax year, the Company only records the difference between the actual and estimated tax on the built-in gains it realizes during each tax year as income tax expense or benefit. The remaining net unrealized built-in gains, which are subject to tax, as of September 30, 2016 and 2015 were $113,893 and $98,997, respectively. The deferred tax liabilities relating to those net unrealized built-in gains as of September 30, 2016 and 2015, were $45,363 and $39,431, respectively.

The Company follows ASC 740, Income Taxes, ("ASC 740") to account for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to the net unrealized investment gain (losses) on existing investments. In estimating future tax consequences, the Company considers all future events, other than enactments of changes in tax laws or rates. The effect on deferred tax assets and liabilities of a change in tax rates will be recognized as income or expense in the period of enactment. In addition, ASC 740 provides guidance for how uncertain tax positions should be recognized, measured, presented, and disclosed in the financial statements. As of September 30 and June 30, 2016, there were no uncertain tax positions. Management's determinations regarding ASC 740 may be subject to review and adjustment at a later date based upon factors including, but not limited to, an on-going analysis of tax laws, regulations and interpretations thereof.

NOTE 3 –INVESTMENTS

The following table summarizes the composition of the Company's investments at cost and fair value as of September 30, 2016, and June 30, 2016:

	September 30, 2016				June 30, 2016
Asset Type	Cost		Fair Value		Cost		Fair Value
Publicly Traded Companies	$	14,711,559	$	15,193,923	$	10,917,013	$	11,475,174
Non Traded Companies		10,487,057		10,806,581		11,406,586		11,609,041
LP Interests		15,018,889		17,135,148		14,390,162		15,793,475
Investment Trusts		258,436		192,061		258,435		195,065
Notes		-		-		104,942		104,017
Total	$	40,475,941	$	43,327,713	$	37,077,138	$	39,176,772

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The following table presents fair value measurements of the Company's investments measured at fair value on a recurring basis as of September 30, 2016, according to the fair value hierarchy:

Asset Type	Total		Level I		Level II		Level III
Publicly Traded Companies	$	15,193,923	$	14,928,923	$	265,000	$	-
Non Traded Companies		10,806,581		-		-		10,806,581
LP Interests		17,135,148		-		-		17,135,148
Investment Trusts		192,061		-		-		192,061
Total	$	43,327,713	$	14,928,923	$	265,000	$	28,133,790

The following table presents fair value measurements of the Company's investments measured at fair value on a recurring basis as of June 30, 2016, according to the fair value hierarchy:

Asset Type	Total		Level I		Level II		Level III
Publicly Traded Companies	$	11,475,174	$	11,117,674	$	357,500	$	-
Non Traded Companies		11,609,041		-		2,820,137		8,788,904
LP Interests		15,793,475		-		-		15,793,475
Investment Trusts		195,065		-		-		195,065
Notes		104,017		-		-		104,017
Total	$	39,176,772	$	11,117,674	$	3,177,637	$	24,881,461

The following is a reconciliation of the beginning and ending balances for investments measured at fair value on a recurring basis using significant unobservable inputs (Level III) for the three month period ended September 30, 2016:

Balance at July 1, 2016	$	24,881,461
Purchases of investments		2,148,321
Proceeds from sales, net		(281	)
Return of capital		(133,857	)
Net realized gains		132
Net unrealized gains		1,238,014
Ending balance at September 30, 2016	$	28,133,790

For the three months ended September 30, 2016, changes in unrealized gains included in earnings relating to Level III investments still held at September 30, 2016, was $1,238,014.

Balance at July 1, 2015	$	15,197,370
Purchases of investments		1,768,847
Transfers to Level I		(3,189,287	)
Proceeds from sales, net		(324,119	)
Return of capital		(1,177	)
Net realized gain		(6,857	)
Net unrealized gain		1,319,200
Ending balance at September 30, 2015	$	14,763,977

For the three months ended September 30, 2015, changes in unrealized gains included in earnings relating to Level III investments still held at September 30, 2015 was $1,285,481.

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The transfers of $3,189,287 from Level III to Level I category during the three months ended September 30, 2015, relates to changes in tradability of the securities in an active market due to one of the Company's investments converting from a private REIT shares to public REIT shares.

The following table shows quantitative information about significant unobservable inputs related to the Level II and Level III fair value measurements used at September 30, 2016:

Asset Type	Fair Value		Primary Valuation Techniques	Unobservable Inputs Used	Range			Wt. Average

Level II

Publicly Traded Company	$	265,000	Market Activity	10 day average trading price

	$	265,000

Level III

Non Traded Company	$	9,668,939	Market Activity	Secondary market industry publication


Non Traded Company		1,137,642	Net Asset Value ⁽¹⁾	Capitalization rate		6.4% - 8.4	%		7.7 %
				Liquidity discount		10.0% -32.3	%		25.0 %
				Sponsor provided value

LP Interest		620,445	Market Activity	Acquisition cost
				Secondary market industry publication

LP Interest		16,514,703	Net Asset Value ⁽¹⁾	Capitalization rate		6.3% - 7.1	%		6.6 %
				Discount rate		9.0% - 30	%		22.5 %
				Liquidity discount		10.0% - 52.3	%		16.8 %
				Sponsor provided value
				Contracted sale price of underlying asset

Investment Trust		89,367	Market Activity	Secondary market industry publication
Investment Trust		102,694	Net Asset Value ⁽¹⁾	Capitalization rate		6.7	%
				Liquidity discount		15.0	%

	$	28,133,790

Valuation Technique Terms:

(1)	The net asset value of the issuer's shares was calculated by the Company.

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The following table shows quantitative information about significant unobservable inputs related to the Level II and Level III fair value measurements used at June 30, 2016:

Asset Type	Fair Value		Primary Valuation Techniques	Unobservable Inputs Used	Range			Wt. Average

Level II

Publicly Traded Company	$	357,500	Market Activity	10 day average trading price
Non Traded Company		2,820,137	Market Activity	Publicly traded price of like security

	$	3,177,637

Level III

Non Traded Company	$	8,092,915	Market Activity	Acquisition cost
				Secondary market industry publication

Non Traded Company		695,989	Net Asset Value ⁽¹⁾	Capitalization rate		6.4% - 8.3	%		7.3 %
				Liquidity discount		22.3% -32.3	%		26.5 %
				Sponsor provided value

LP Interest		8,203,247	Market Activity	Acquisition cost
				Secondary market industry publication

LP Interest		7,590,228	Net Asset Value ⁽¹⁾	Capitalization rate		6.3% - 7.1	%		6.9 %
				Price per apartment unit
				Discount rate		30.0	%
				Liquidity discount		15.0% - 38.0	%		23.9 %
				Sponsor provided value

Investment Trust		95,987	Market Activity	Secondary market industry publication
Investment Trust		99,078	Net Asset Value ⁽¹⁾	Capitalization rate		6.7	%
				Liquidity discount		15.0	%

Note		104,017	Net Asset Value ⁽¹⁾	Liquidity discount		52.3	%

	$	24,881,461

Valuation Technique Terms:

(1)	The net asset value of the issuer's shares was calculated by the Company.

NOTE 4—MARGIN LOANS

The Fund has a brokerage account through which it buys and sells publicly traded securities. The provisions of the account allow the Company to borrow between 50% and 70% of the equity of certain securities held in the account. Amounts borrowed are collateralized by the securities held in the account and bear interest at a negotiated rate payable monthly. Securities pledged to secure margin balances cannot be specifically identified as a portion of all securities held in a brokerage account are used as collateral. As of September 30, 2016, the Company had $6,892,561 of margin credit available for cash withdrawal or the ability to purchase up to $13,785,122 in additional shares. As of June 30, 2016, the Company had $5,844,828 of margin credit available for cash withdrawal or the ability to purchase up to $11,689,656 in additional shares. As of September 30, 2016, and June 30, 2016, the Company had not drawn any amount or purchased any shares under this short-term credit line.

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NOTE 5 –RELATED PARTY TRANSACTIONS

Investment Advisory Agreement:

Under the Investment Advisory Agreement, the Company will pay the Adviser a fee for its services consisting of three components — a portfolio structuring fee, a base management fee, and a subordinated incentive fee.

The portfolio structuring fee is for the Adviser's initial work performed in identifying, evaluating and structuring the acquisition of portfolio of assets. The fee equals 3.0% of the gross proceeds from the sale of the Company's Shares. The services are performed on an ongoing basis in anticipation of deploying new capital, generally within 15 days of the receipt of capital. Therefore, this fee is expensed in the period the capital is accepted.

The base management fee is calculated based on the Company's "managed funds," which equal the price at which the Company's Shares are issued plus any borrowing for investment purposes. The base management fees range from 1.5% to 3.0%, depending on the level of the "managed funds."

The subordinated incentive fee has two parts— the income and the capital gains. The income component is (i) 100% of the Company's preliminary net investment income for any calendar quarter that exceeds 1.75% (7% annualized) but is less than 2.1875% (8.75% annualized) of the Company's "contributed capital" (defined as the number of Shares outstanding, multiplied by the price at which the Shares are sold), and (ii) 20% of the Company's preliminary net investment income for any calendar quarter that exceeds 2.1875% (8.75% annualized) of the Company's "contributed capital." The capital gains component is (i) 100% of the Company's realized capital gains annually generated by its investments above 7% and up to 8.75% of the Company's "contributed capital," and (ii) 20% of the Company's realized capital gains above 8.75% of the Company's "contributed capital," all computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees. If the Company liquidates all of its assets, the capital gains component is 20.0% of realized capital gains (without the hurdle), computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees. The capital gains component may not, in any event, exceed 20% of the Company's realized capital gains, net of all realized capital losses and unrealized capital depreciation.

The portfolio structuring fees for the three months ended September 30, 2016, and 2015, were $197,208 and $111,689 (as restated), respectively.

As of September 30, 2016, Managed Funds were $47,483,206. Thus, the base management fee for the three months ended September 30, 2016, was 1/4^th of 3% of $20,000,000 plus 1/4^th of 2% of the remaining $27,483,206, for a total of $287,416. As of September 30, 2015, Managed Funds were $25,777,367. Thus, the base management fee for the three months ended September 30, 2015, was 1/4^th of 3% of $20,000,000 plus 1/4^th of 2% of the remaining $5,777,367, for a total of $178,887.

There were no subordinated incentive fees for the three months ended September 30, 2016 and 2015.

Organization and Offering Costs Reimbursement:

As provided in the Investment Advisory Agreement, organization and offering costs incurred by the Company on its initial registration statement in excess of $550,000 will be reimbursed by the Adviser. As of September 30, 2016, and June 30, 2016, the Company had incurred $1,066,226 and $1,055,350 of organization and offering costs, respectively. Thus, according to the agreement, $516,226 and $505,350 of the amount were reimbursable from the Adviser as of September 30, 2016, and June 30, 2016, respectively. As of September 30, 2016, the Adviser has reimbursed the Company $505,350 and the remaining reimbursable amount of $10,876 was offset against the amount payable to the Adviser as of September 30, 2016.

Administration Agreement:

Under the Administration Agreement, the Company reimburses MacKenzie for its allocable portion of overhead and other expenses it incurs in performing its obligations under the Administration Agreement, including furnishing the Company with office facilities, equipment and clerical, bookkeeping and record keeping services at such facilities, performing compliance functions, providing the services of the Chief Financial Officer, Chief Compliance Officer, Director of Financial Reporting, and any administrative support staff, as well as providing the Company with other administrative services, subject to the Independent Directors' approval.The administrative cost reimbursements for the three months ended September 30, 2016, and 2015, were $55,000 and $30,000, respectively.

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The table below outlines the related party expenses incurred for the three months ended September 30, 2016, and 2015 and unpaid as of September 30, 2016, and June 30, 2016.

	For The Three Months Ended				Unpaid as of
Types and Recipient	September 30, 2016		September 30, 2015		September 30, 2016			June 30, 2016

Portfolio Structuring fee- the Adviser	$	197,208	$	111,689	$	-		$	-
Base Management fees- the Adviser		287,416		178,887		287,416			252,866
Administrative Cost Reimbursements- MacKenzie		55,000		30,000		-			30,000
Organization & Offering Cost Reimbursement by the Adviser						(10,876	)		(15,886	)
Due from related entities ⁽¹⁾						(36,759	)		(36,759	)
Due to related entities					$	239,781		$	230,221

⁽¹⁾ As disclosed in the restated financial statements as of June 30, 2016, these amounts are the subordinated incentive income fee refund receivable from the Adviser as of June 30, 2016 and 2015, resulting from the reclassification of the portfolio structuring fee as operating expenses. The amount was fully refunded by the Adviser subsequent to September 30, 2016.

Investments in affiliated companies:

									Amount of equity in net profit and loss For The Three Months Ended September 30,:				Amount of dividends/interest For The Three Months Ended September 30,:

Name of issuer and title of issue	Number of shares at				Fair Value at
	September 30, 2016		June 30, 2016		September 30, 2016		June 30, 2016		2016		2015		2016		2015
Controlled Investments:

Coastal Realty Business Trust, REEP, Inc.- A		72,320.00		72,320.00	$	102,694	$	99,078	$	-	$	-	$	-	$	-
Coastal Realty Business Trust, Series H2- A		47,284.16		47,284.16	$	89,367	$	95,987	$	2,364	$	2,364	$	2,364	$	2,364
MC 15 Preferred Equity, LLC		250,000.00		250,000.00	$	2,810,000	$	2,500,000	$	-	$	-	$	-	$	-

Non-Controlled/Affiliate Investment:

MPF Pacific Gateway - Class B		23.20		23.20		7,309	$	7,309	$	-	$	-	$	-	$	-

Coastal Realty Business Trust ("CRBT"):

CRBT is a Nevada business trust whose trustee is MacKenzie. Each series of the trust has its own beneficiaries and own assets. The Fund owns two series of CRBT and is the only beneficiary of such series. Under the terms of the agreement, there are no redemption rights to any of the series participants.

The Fund is the sole beneficiary of the following series as of September 30, 2016, and June 30, 2016:

·	CRBT, REEP, Inc.-A, which has an ownership interest in one of three general partners of a limited partnership which owns one multi-family property located in Frederick, Maryland.

·	CRBT, Series H2-A, which invests in shares of a REIT that owns a real estate portfolio totaling 105 properties within asset classes of ski and mountain lifestyle, senior housing, attractions, marinas and other lifestyle properties located in the United States and Canada.

MC 15 Preferred Equity, LLC:

MC 15 Preferred Equity, LLC is a holding company that owns preferred equity of a company that owns a commercial real estate property in Austin, Texas. The Company is a co-manager of MC 15 Preferred Equity, LLC and owns 55.8% ownership interest in the company.

MPF Pacific Gateway:

MPF Pacific Gateway, which is managed by MacKenzie, is a holding company that owns an investment in a REIT Liquidating Trust. As of September 30, 2016, and June 30, 2016, the Company had a 15.82% of ownership interest in MPF Pacific Gateway.

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NOTE 6 – FINANCIAL HIGHLIGHTS

The following is a schedule of financial highlights of the Company for the three months ended September 30, 2016, and the year ended June 30, 2016.

	For The Three Months Ended			For The Year Ended
	September 30, 2016			June 30, 2016
Per Share Data:	(Unaudited)

Beginning net asset value	$	9.94		$	10.18

Net investment income (loss) ⁽¹⁾		0.02			0.26
Net realized gain ⁽¹⁾		0.22			0.91
Net unrealized gain (loss) ⁽¹⁾		0.17			(0.01	)
Net increase in net assets resulting from operations		0.41			1.16

Issuance of common stock above (below) net asset value ⁽¹⁾ ⁽⁴⁾		(0.14	)		(0.68	)
Redemption of common stock below net asset value ^{(1) (6)}		-			0.05
Dividends to stockholders from net realized gains ^{(1) (5)}		(0.21	)		(0.77	)
Ending net asset value	$	10.00		$	9.94

Weighted average common Shares outstanding		4,533,971			3,073,448
Shares outstanding at the end of period		4,748,321			4,057,319
Net assets at the end of period	$	47,461,994		$	40,332,191
Average net assets ⁽²⁾	$	43,897,093		$	31,346,210

Ratios to average net assets
Total expenses		1.61	%		5.83	%
Net investment income (loss)		0.19	%		2.58	%
Total rate of return ^{(2) (3) (7)}		4.22	%		11.49	%

(1) Based on weighted average number of shares of common stock outstanding for the period.
(2) Average net assets were derived from the beginning and ending period-end net assets.
(3) Total rate of return is based on net increases (decreases) in net assets resulting from operations. An individual stockholder's return may vary from this return based on the time of capital transactions.
(4) Net of sales commissions and dealer manager fees of $1.00 per share.
(5) Dividends are determined based on taxable income calculated in accordance with income tax regulations which may differ from amounts determined under GAAP.
(6) Based on the most recent NAV issued as of June 30, 2016, and March 31, 2016, of $9.93 and $9.77 per share, respectively.
(7) Not annualized for interim reporting periods.

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NOTE 7 – SHARE OFFERINGS AND FEES

During the three months ended September 30, 2016, the Company issued 657,362 shares with gross proceeds of $6,573,620 pursuant to the offering, and 51,549.95 shares under the Company's dividend reinvestment plan ("DRIP") with gross proceeds of $463,950. For the three months ended September 30, 2016, the Company incurred selling commissions and fees of $657,362.

During the three months ended September 30, 2015, the Company issued 373,060 shares with gross proceeds of $3,722,968 pursuant to the offering, and 12,482.64 shares under the Company's dividend reinvestment plan ("DRIP") with gross proceeds of $112,344. For the three months ended September 30, 2015, the Company incurred selling commissions and fees of $364,797 (as restated).

NOTE 8 – SHARE REPURCHASE PLAN

During the quarter ended September 30, 2016, the Company, pursuant to its Share Repurchase Program, submitted a tender offer on August 24, 2016, to purchase its own Shares issued and outstanding at $9 per Share. The offer expired on September 26, 2016, and as of the offer expiration date, the Company received and accepted to repurchase a total of 17,910.76 shares issued and outstanding and for total cash payment of $161,197.

NOTE 9 –STOCKHOLDER DIVIDENDS AND INCOME TAXES

The following table reflects the dividend the Company paid on its common stock during the three months ended September 30, 2016:

	Dividends
During the Quarter Ended	Per Share		Amount

Three months ended September 30, 2016	$	0.250	$	942,659

	$	0.250	$	942,659

Of the total dividend paid during the three months ended September 30, 2016, $463,950 was reinvested under the DRIP.

The following table reflects the dividend the Company paid on its common stock during the three months ended September 30, 2015:

	Dividends
During the Quarter Ended	Per Share		Amount

Three months ended September 30, 2015	$	0.300	$	623,394

	$	0.300	$	623,394

Of the total dividend paid during the three months ended September 30, 2015, $112,344 was reinvested under the DRIP.

On November 9, 2016, the Company's Board of Directors approved a quarterly dividend of $0.25 per share to the holders of record on September 30, 2016, which was paid on November 15, 2016.

Income Taxes

While our fiscal year end for financial reporting purposes is June 30 of each year, our tax year end is December 31 of each year. The information presented in this footnote is based on our tax year end for each period presented, unless otherwise specified.

For income tax purposes, dividends paid and distributions made to stockholders are reported as ordinary income, capital gains, non-taxable return of capital, or a combination thereof. The tax character of dividends paid to stockholders for the tax year ended December 31, 2015, (the most recent tax year end completed and filed) were as follows:

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	December 31, 2015
Ordinary income - earnings and profits from pre REIT qualification	$	-
Capital gain		867,496
Ordinary income- Post REIT qualification		1,482,715
Total dividends	$	2,350,211

The tax character of dividends paid to stockholders since December 31, 2015 (the most recent tax year ended completed and filed) through September 30, 2016, is expected to be ordinary income and capital gains. Because of the difference between our fiscal and tax year ends, the final determination of the tax character of dividends will not be made until we file our tax return for the tax year ending December 31, 2016.

The components of undistributed earnings on a tax basis as of December 31, 2015 (the most recent tax year end completed and filed) were as follows:

	December 31, 2015

Undistributed long term capital gain	$	235,124
Unrealized fair value appreciation		3,038,753
	$	3,273,877

The following table presents the aggregate gross unrealized appreciation, depreciation, and cost basis of investments for income tax purposes as of:

	September 30, 2016			June 30, 2016

Aggregate gross unrealized appreciation	$	5,029,205		$	4,180,504
Aggregate gross unrealized depreciation		(1,216,927	)		(1,391,373	)
Net unrealized appreciation	$	3,812,278		$	2,789,131

Aggregate cost (tax basis)	$	39,515,434		$	36,387,641

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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Statements by MacKenzie Realty Capital, Inc. (the "Company," "we," or "us") contained herein, other than historical facts, may constitute "forward-looking statements." These statements may relate to, among other things, future events or our future performance or financial condition. In some cases, you can identify forward-looking statements by terminology such as "may," "might," "believe," "will," "provided," "anticipate," "future," "could," "growth," "plan," "intend," "expect," "should," "would," "if," "seek," "possible," "potential," "likely" or the negative of such terms or comparable terminology. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any anticipated results, levels of activity, performance or achievements expressed or implied by such forward-looking statements, including an economic downturn could impair our portfolio companies' ability to continue to operate, which could lead to the loss of some or all of our investments in such portfolio companies; a contraction of available credit and/or an inability to access the equity markets could impair our lending and investment activities; and interest rate volatility could adversely affect our results, particularly if we elect to use leverage as a part of our investment strategy. For a discussion of factors that could cause our actual results to differ from forward-looking statements contained herein, please see the discussion under the heading "Risk Factors" in our Annual Report on Form 10-K/A.

We may experience fluctuations in our operating results due to a number of factors, including the return on our equity investments, the interest rates payable on our debt investments, the default rates on such investments, the level of our expenses, variations in and the timing of the recognition of realized and unrealized gains or losses, the degree to which we encounter competition in our markets and general economic conditions. As a result of these factors, results for any period should not be relied upon as being indicative of performance in future periods.

Overview

We are an externally managed non-diversified closed-end management investment company that has elected to be treated as a BDC under the 1940 Act. Our objective is to generate both current income and capital appreciation through real estate-related investments. We have elected to be treated as a REIT under the Code and as a REIT, we are not be subject to federal income taxes on amounts that we distribute to the stockholders, provided that, on an annual basis, we distribute at least 90% of our REIT taxable income to the stockholders and meet certain other conditions. To the extent that we satisfy the annual distribution requirement but distribute less than 100% of our taxable income, we will be subject to an excise tax on our undistributed taxable income.

We are managed by the Adviser, and MacKenzie provides the non-investment management services and administrative services necessary for us to operate.

Investment Plan

Our investments are generally expected to range in size from $10,000 to $3 million. However, we may make smaller or larger investments from time to time on an opportunistic basis. We focus primarily on real estate-related securities. We purchase most of our securities (i) directly from existing security holders, (ii) through established securities markets, and (iii) in the case of unregistered, privately offered securities, directly from issuers. We invest primarily in debt and equity securities issued by U.S. companies that primarily own commercial real estate that are either illiquid or not listed on any exchange.

We generally seek to invest in interests of real estate-related limited partnerships and REITs. Under normal market conditions, we invest at least 80.0% of our total assets in common stocks and other equity or debt securities issued by real estate companies, including REITs and similar REIT-like entities. A real estate company is one that (i) derives at least 50.0% of its revenue from the ownership, construction, financing, management or sale of commercial, industrial or residential real estate and land; or (ii) has at least 50.0% of its assets invested in such real estate. We do not invest in general partnerships, joint ventures, or other entities that do not afford limited liability to their security holders. However, limited liability entities that we may invest in may in turn hold interests in general partnerships, joint ventures, or other non-limited liability entities. We generally consider purchasing securities issued by entities that have (i) completed the initial offering of their securities, (ii) operated for a period of at least two years, and typically more than five years, from the completion of their initial offering, and (iii) fully invested their capital in real properties or other real estate-related investments.

We may also acquire (i) individual mortgages secured by real property (i.e., we may originate such loans or we may purchase outstanding loans secured by real estate), (ii) securities of issuers that own mortgages secured by income producing real property, and (iii) using no more than 20.0% of our available capital, securities of issuers that own assets other than real estate.

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Investment income

We generate revenues in the form of capital gains and dividends on dividend-paying equity securities or other equity interests that we acquire, in addition to interest on any debt investments that we hold. Further, we may generate revenue in the form of commitment, origination, structuring or diligence fees, monitoring fees, fees for providing managerial assistance and possibly consulting fees and performance-based fees. Any such fees are generated in connection with our investments and recognized as earned.

Expenses

Our primary operating expenses include the payment of: (i) investment advisory fees to our Adviser; (ii) our allocable portion of overhead and other expenses incurred by MacKenzie Capital Management in performing its obligations under the Administration Agreement; and (iii) other operating expenses as detailed below. Our investment advisory fees compensate our Investment Adviser for its work in identifying, evaluating, negotiating, closing, monitoring and servicing our investments. Our expenses must be billed to and paid by us, except that MacKenzie may be reimbursed for actual cost of goods and services used by us and certain necessary administrative expenses. We will bear all other expenses of our operations and transactions, including:

·	the cost of calculating our NAV, including the cost of any third-party valuation services;

·	the cost of effecting sales and repurchases of our Shares and other securities;

·	interest payable on debt, if any, to finance our investments;

·	fees payable to third parties relating to, or associated with, making investments, including fees and expenses associated with performing due diligence reviews of prospective investments and third-party advisory fees;

·	transfer agent and safekeeping fees;

·	fees and expenses associated with marketing efforts;

·	federal and state registration fees, any stock exchange listing fees in the future;

·	federal, state and local taxes;

·	Independent Directors' fees and expenses;

·	brokerage commissions;

·	fidelity bond, directors and officers errors and omissions liability insurance and other insurance premiums;

·	direct costs and expenses of administration and sub-administration, including printing, mailing, long distance telephone and staff;

·	fees and expenses associated with independent audits and outside legal costs;

·	costs associated with our reporting and compliance obligations under the 1934 Act, the 1940 Act and applicable federal and state securities laws; and

all other expenses incurred by either MacKenzie or us in connection with administering our business, including payments under the Administration Agreement that will be based upon our allocable portion of overhead and other expenses incurred by MacKenzie in performing its obligations under the Administration Agreement, including rent, the fees and expenses associated with performing compliance functions, and our allocable portion of the costs of compensation and related expenses of our chief compliance officer and our chief financial officer and any administrative support staff.

In addition, we have already born $550,000 of organization and offering expenses. Any additional amounts with respect shares being sold pursuant to the initial registration statement are paid by our Adviser.

Portfolio Investment Composition

The following table summarizes the composition of our investments at cost and fair value as of September 30, 2016, and June 30, 2016:

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	September 30, 2016				June 30, 2016
Asset Type	Cost		Fair Value		Cost		Fair Value
Publicly Traded Companies	$	14,711,559	$	15,193,923	$	10,917,013	$	11,475,174
Non Traded Companies		10,487,057		10,806,581		11,406,586		11,609,041
LP Interests		15,018,889		17,135,148		14,390,162		15,793,475
Investment Trusts		258,436		192,061		258,435		195,065
Notes		-		-		104,942		104,017
Total	$	40,475,941	$	43,327,713	$	37,077,138	$	39,176,772

Net Asset Value

September 30, 2016 vs. June 30, 2016:

Our net asset value ("NAV") as of September 30, 2016, was $10.00 per Share compared to $9.94 per Share as of June 30, 2016, a $0.06 per Share increase of approximately 3.9%. The net increase during the three months was due to increases resulting from (i) net realized gains on sale of investments of $0.22 per Share (ii) net unrealized gain on investments of $0.17 per Share and (iii) net investment income of $0.02 per Share. The increases in NAV were offset by decreases resulting from (i) issuance of Shares below NAV resulting in decrease of a $0.14 per Share and (ii) a weighted average per Share dividend to stockholders of $0.21 per Share.

Results of Operations

Our original Form 10-K for the year ended June 30, 2016, filed on September 22, 2016, was amended to restate the Company's statements of assets and liabilities as of June 30, 2016 and 2015, and its statements of operations, statements of changes in net assets, and statement of cash flows for the years ended June 30, 2016, 2015, and 2014, along with certain related notes to such restated financial statements. In addition, the Company restated the unaudited quarterly data within the year ended June 30, 2016, 2015, and 2014. The restatements reflected the correction in accounting treatment of the portfolio structuring fee as an operating expense instead of as a reduction to equity. Accordingly, the amounts below for the three months ended September 30, 2015, reflect the restated amounts.

Three Months Ended September 30, 2016, and 2015:

Investment Income: Investment income was primarily made up of dividend, distribution, interest and other investment income. Total investment income for the three months ended September 30, 2016, and 2015, were $790,329 and $678,568, respectively. The increase of $111,761, or 16%, was primarily due to an increase in our investment portfolio size by approximately $20.8 million in cost basis since September 30, 2015. The cost basis of our investment portfolio was $40.5 million as of September 30, 2016, compared to $19.6 million as of September 30, 2015. Of the new investments acquired since September 30, 2015, BR Beach House Investment Co., BR Riverside Investment Co., and Satellite Investment Holdings, LLC, generated the additional distributions and dividends during the three months ended September 30, 2016.

Operating Expenses:

Base management fee: The base management fee for the three months ended September 30, 2016 was $287,416 as compared to $178,887 for the three months ended September 30, 2015. The increase was due to an increase in the managed funds by $21.7 million from $25.8 million as of September 30, 2015, to $47.5 million as of September 30, 2016.

Portfolio structuring fee: The portfolio structuring fee for the three months ended September 30, 2016 was $197,208 compared to $111,689 for the three months ended September 30, 2015. The increase was due to an increase in the issuance of the Company's Shares during the three months ended September 30, 2016. During the three months ended September 30, 2016, the Company issued Shares with gross proceeds of $6.6 million as compared to $3.7 million during the three months ended September 30, 2015.

Administrative cost reimbursements: Costs reimbursed to Mackenzie for the three months ended September 30, 2016, was $55,000 as compared to $30,000 for the three months ended September 30, 2015. The increase was primarily due to an increase in the allocable portion of overhead and other expenses incurred by MacKenzie.

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Other operating expenses: Other operating expenses for the three months ended September 30, 2016 were $166,237 as compared to $103,162 for the three months ended September 30, 2015. The increase of $63,075 or 61% was primarily due to the increase in professional fees incurred by the Company during the three months ended September 30, 2016.

Net realized gain on investments:

Total net realized gains for three months ended September 30, 2016 and 2015, were $1,016,846 and $328,799, respectively. Total realized gains for the three months ended September were realized from (i) the merger of Apple REIT Ten, Inc. (non-traded REIT) with Apple Hospitality REIT, Inc. (a publicly traded REIT) with the realized gains of $0.6 million and (ii) sales of 92,649 shares of TIER REIT, Inc. (publicly traded REIT) with realized gains of $0.4 million. Total gains realized for the three months ended September 30, 2015, were mainly realized from the sale of some of the publicly traded TIER REIT, Inc. shares with realized gains of $0.3 million.

Net unrealized gain/loss on investments:

During the three months ended September 30, 2016, we recorded unrealized gains of $752,137, which is net of gains realized during the period of $1,016,846. During the three months ended September 30, 2015, we recorded unrealized gains of $553,614, which was net of gains realized during the period of $328,799.

The net unrealized gain of $1.8 million for the three months ended September 30, 2016, resulted from the fair value appreciation of $0.2 million from publicly traded REITs, $0.8 million from non-traded REITs and $0.4 million from limited partnership interests. The net unrealized gain of $0.9 million (inclusive of the reclassified realized gains) for the three months ended September 30, 2015, primarily resulted from the fair value appreciation of $1.3 million from non-trade REITs offset by fair value depreciation of $0.4 million in publicly traded REITs.

Income tax provision (benefit):

We did not record any income tax expenses for the three months ended September 30, 2016, or 2015, as we have elected to be treated as a REIT for tax purposes beginning with the tax year ended December 31, 2014. The income tax benefit of $1,412 reflected in the statements of operations for the three months ended September 30, 2015, was the adjustment for the difference between the actual and estimated tax on the built-in gains realized during the 2014 tax year.

As a REIT, the Company is not subject to federal income taxes on amounts that it distributes to the stockholders, provided that, on an annual basis, it distributes at least 90% of its REIT taxable income to the stockholders and meets certain other conditions. The Company satisfied the annual dividend payment and other REIT requirements for the tax year ended December 31, 2015, and 2014. Therefore, the Company did not incur any tax expense or excise tax for those periods. In addition, during tax year ended December 31, 2016, we intend to pay the requisite amount of dividends to stockholders such that the Company would not pay any income taxes on its income. Therefore, the Company did not record any income tax provisions during the period of January 1, through September 30, 2016.

Liquidity and Capital Resources

Capital Resources

We filed a Registration Statement on Form N-2 with the Securities and Exchange Commission to register the sale of 5,000,000 Shares, under which we seek to raise up to $50,000,000 in our IPO. As of September 30, 2016, we sold 4,043,235.54 Shares with gross proceeds of $40,403,694 and issued 164,398 Shares under our DRIP with gross proceeds of $1,479,592. As of September 30, 2016, 187,518.23 Shares have been repurchased under our Share Repurchase Program at an aggregate price of $1,687,664. We do not have any plans to issue any preferred equity. We plan to fund future investments with the net proceeds raised in the IPO and any future offerings of securities and cash flows from operations, as well as interest earned from the temporary investment of cash in U.S. government securities and other high-quality debt investments that mature in one year or less. We may also fund a portion of our investments through borrowings from banks and issuances of senior securities; however, we do not have any current plans to borrow money. As of September 30, 2016, we were selling our Shares on a continuous basis at a price of $10 which may be below NAV per Share from time to time, as approved by our stockholders.

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Our aggregate borrowings (if any), secured and unsecured, are expected to be reasonable in relation to our net assets and will be reviewed by the Board of Directors at least quarterly. The maximum amount of such borrowing is limited by the 1940 Act.

Our primary uses of funds are investing in portfolio companies, paying cash dividends to holders of our common stock (primarily from investment income and realized capital gains), making payments to any lenders or senior security holders, and the payment of operating expenses. If all of the shares registered under the Registration Statement in the IPO are sold, we would receive investable cash totaling approximately $43.5 million.

Cash Flows:

For the three months ended September 30, 2016, we experienced a net increase in cash of $2.3 million. During this period, we generated $4.5 million of cash from our financing activities and used $2.2 million in operating activities.

The net cash outflow of $2.2 million from operating activities was primarily due to the cash outflow of $8.4 million from purchases of investments offset by cash inflows of $5.9 million from sales of investments, $0.1 million from distributions received from our investments that are considered return of capital and $0.2 million from investment income, net of the Company's operating expenses.

The net cash inflow of $4.5 million from financing activities resulted from the sale of Shares under our current offering with gross proceeds of $5.8 million (adjusted for the $0.8 million of decrease in capital pending acceptance) offset by cash outflows of $0.2 million from Share redemptions, $0.5 million from dividend payments and $0.6 million from selling commissions and fees payments.

Contractual Obligations

We have entered into two contracts under which we have material future commitments: (i) the Advisory Agreement, under which the Adviser serves as our investment adviser, and (ii) the Administration Agreement, under which MacKenzie furnishes us with certain non-investment management services and administrative services necessary to conduct our day-to-day operations. Each of these agreements is terminable by either party upon proper notice. Payments under the Advisory Agreement in future periods (after the up-front payment of the portfolio structuring fee during the IPO) will be (i) a percentage of the value of our Managed Funds; and (ii) incentive fees based on our income and our performance above specified hurdles (except in the year of liquidation). Payments under the Administration Agreement will occur on an ongoing basis as expenses are incurred on our behalf by MacKenzie. However, if MacKenzie withdraws as our administrator, it will be liable for any expenses we incur as a result of such withdrawal.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources.

Borrowings

We do not have any current plans to borrow money or issue preferred securities. In the event that we do so borrow, we would expect to be subject to various customary covenants and restrictions on our operations, such as covenants which would (i) require us to maintain certain financial ratios, including asset coverage, debt to equity and interest coverage, and a minimum net worth, and/or (ii) restrict our ability to incur liens, additional debt, merge or sell assets, make certain investments and/or distributions or engage in transactions with affiliates.

Critical Accounting Policies

The financial statements included in this report are based on the selection and application of critical accounting policies, which require management to make significant estimates and assumptions. Critical accounting policies are those that are both important to the presentation of our financial condition and results of operations and require management's most difficult, complex or subjective judgments. There have been no changes in the significant accounting policies from those disclosed in the audited financial statements for the year ended June 30, 2016, included in the Company's annual report on Form 10-K/A for the fiscal year ended June 30, 2016.

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Dividends to Stockholders

We began paying quarterly dividends to our stockholders since May 9, 2014, and to the extent that we have income from operations available, we intend to pay quarterly dividends to our stockholders. Our quarterly dividends, if any, will be determined by our Board of Directors after a quarterly review and will be paid pro-rata to holders of our Shares. Any dividends to our stockholders will be declared out of assets legally available for distribution. In no event are we permitted to borrow money to pay dividends (or make distributions) if the amount of such distribution would exceed our annual accrued and received revenues, less operating costs.

We qualified and elected to be taxed as a REIT beginning with the tax year ended December 31, 2014. As a REIT, we are required to distribute at least 90% of our REIT taxable income to the stockholders and meet certain other conditions. Our current intention is to make any dividends in additional Shares under our DRIP out of assets legally available therefore, unless a stockholder elects to receive dividends in cash, or their participation in our DRIP is restricted by a state securities regulator. If one holds Shares in the name of a broker or financial intermediary, they should contact the broker or financial intermediary regarding their election to receive dividends in cash. We can offer no assurance that we will achieve results that will permit the payment of any cash dividends and, if we issue senior securities, we are prohibited from paying dividends if doing so causes us to fail to maintain the asset coverage ratios stipulated by the 1940 Act or if dividends are limited by the terms of any of our borrowings.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Our current investment portfolio, as well as our future investments, primarily consists of equity and debt securities issued by smaller U.S. companies that primarily own commercial real estate that are either illiquid or not listed on any exchange, and our investments in these securities are considered speculative in nature. Our investments often include securities that are subject to legal or contractual restrictions on resale that adversely affect the liquidity and marketability of such securities. As a result, we are subject to risk of loss which may prevent our stockholders from achieving price appreciation, dividend distributions and a return of their capital.

At September 30, 2016, financial instruments that subjected us to concentrations of market risk consisted principally of equity investments, which represented 89% of our total assets as of that date. As discussed in Note 3 to our financial statements ("Investments"), these investments primarily consist of securities in companies with no readily determinable market values and as such are valued in accordance with our fair value policies and procedures. Our investment strategy represents a high degree of business and financial risk due to the fact that portfolio company investments are generally illiquid and in small and middle market companies. We may make short-term investments in cash equivalents, U.S. government securities and other high-quality investments that mature in one year or less, pending investments in portfolio companies made according to our principal investment strategy.

Item 4. CONTROLS AND PROCEDURES

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) of the 1934 Act) as of the end of the period covered by this report as required by paragraph (b) of Rule 13a-15 or 15d-15 of the 1934 Act. In connection with the restatement discussed in our Form 10-K/A, management became aware of a material weakness in the Company's internal control over financial reporting. As a result of this material weakness, described below, the Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2016, the Company's disclosure controls and procedures were not effective with respect to the issue below. The Company has undertaken remediation efforts, as discussed below.

In light of the material weakness referred to above, the Company has designed and implemented additional controls, including the performance of additional review analyses and procedures, in order to conclude that the financial statements in this Form 10-Q as of September 30, 2016 are fairly presented, in all material respects, in accordance with GAAP. The additional controls implemented include the performance of additional analyses and procedures with respect to the accounting for sales of common stock. Additional review of the financial statements will be performed by the Chief Financial Officer, President, General Counsel, and audit committee to insure that the PSF is properly accounted for as an operating expense and not as a reduction to equity.

As disclosed in the Form 10-K/A for the fiscal year ended June 30, 2016, we identified a control deficiency in our financial reporting process that constituted a material weakness, which caused the restatement of the audited financial statements as of the year ended June 30, 2016 and 2015, and for each of the three years ended June 30, 2016, included in the Form 10-K/A. It was determined that we did not maintain effective review controls over the accounting for portfolio structuring fees ("PSF"); specifically, the review of accounting treatment related to significant agreements. As a result of our incorrect application of ASC 505, we accounted for the PSF charged by our Adviser as reduction in the proceeds from the sale of the Company's common stock instead of as an operating expense. We are initiating certain measures, including the enhancement of the process for reviewing and interpreting GAAP and accounting guidance regarding stock transactions and increasing the level of review of fees related to our common stock sales, to remediate these weaknesses, and plan to implement additional appropriate measures, if needed, as part of this effort.

The planned additional controls include the performance of additional analyses and procedures with respect to the accounting for sales of common stock. Additional review of the financial statements will be performed by the Chief Financial Officer, President, General Counsel, and audit committee to insure that the PSF is properly accounted for as an operating expense and not as a reduction to equity.

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PART II—OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

None.

Item 1A. RISK FACTORS

There have been no material changes to our risk factors discussed in "Risk Factors" in our annual report on Form 10-K/A for the fiscal year ended June 30, 2016.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

Issuer Purchases of Equity Securities

The following table presents information with respect to the Company's purchases of its common stock since adoption of the Plans through September 30, 2016:

Period	Total Number of Shares Purchased		Average Price Paid Per Share		Cumulative Number of Shares Purchased as Part of Publicly Announced Plans		Maximum Dollar Value of Shares That May Yet Be Purchased Under Publicly Announced Plans
December 7, 2015 through January 7, 2016		74,285.56	$	9.00		74,285.56	$	-
February 18, 2016 through March 21, 2016		51,994.84	$	9.00		126,280.41		-
May 26, 2016 through June 26, 2016		43,327.08	$	9.00		169,607.49		-
August 24, 2016 through September 26, 2016		17,910.76	$	9.00		187,518.25		-

Item 3. DEFAULTS UPON SENIOR SECURITIES

None.

Item 4. MINE SAFETY DISCLOSURES

Not applicable.

Item 5. OTHER INFORMATION

None.

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Item 6. EXHIBITS

Exhibit	Description

31.1	Section 302 Certification of Robert Dixon (President and Chief Executive Officer)

31.2	Section 302 Certification of Paul Koslosky (Treasurer and Chief Financial Officer)

32.1	Section 1350 Certification of Robert Dixon (President and Chief Executive Officer)

32.2	Section 1350 Certification of Paul Koslosky (Treasurer and Chief Financial Officer)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

MACKENZIE REALTY CAPITAL, INC.


Date: December 5, 2016		By: /s/ Robert Dixon
		President and Chief Executive Officer

Date: December 5, 2016		By: /s/ Paul Koslosky
		Treasurer and Chief Financial Officer

Attached files

MacKenzie Realty Capital, Inc. Reports

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