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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-K
 
 þ
    
    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
 For the fiscal year ended December 31, 2007
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 Commission File Number: 333-131677
 
 ORANGE REIT, INC.
 (Exact name of registrant as specified in its charter)
 
 Maryland
    
    20-3749435(State or other jurisdiction of 
incorporation or organization)
    
    (IRS Employer
Identification No.)78 Okner Parkway 
Livingston, New Jersey
(Address of principal executive offices)
    
    07039
(Zip code)
 973-597-6433
(Registrants telephone number, including area code)
 
 Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
 o þ
 þ o
 þ
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller Reporting Company o
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE:
None.




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##### 



ORANGE REIT, INC.
TABLE OF CONTENTS
Form 10-K
For the Year Ended December 31, 2007
 PagePart IItem 1. Business
    
    
    1Item 1A. Risk Factors
    
    
    4Item 1B. Unresolved Staff Comments
    
    
    20Item 2. Properties
    
    
    20Item 3. Legal Proceedings
    
    
    20Item 4. Submission of Matters to a Vote of Security Holders
    
    
    20Part IIItem 5. Market for Registrants Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities
    
    
    20Item 6. Selected Financial Statement Data
    
    
    21Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    23Item 7A. Quantitative and Qualitative Disclosures about Market Risk
    
    
    27Item 8. Financial Statements and Supplementary Data
    
    
    27Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures
    
    
    41Item 9A(T) Controls and Procedures
    
    
    41Item 9B. Other Information
    
    
    42Part III.Item 10. Directors and Executive Officers of the Registrant
    
    
    42Item 11. Executive Compensation
    
    
    45Item 12. Security Ownership of Certain Beneficial Owners and Management
    
    
    46Item 13. Certain Relationships and Related Transactions
    
    
    46Item 14. Principal Accounting Fees and Services
    
    
    49Part IVItem 15. Exhibits and Financial Statement Schedules
    
    
    49Signatures
    
    
    51Exhibit 14.1Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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PART I
  
 Item 1. Business
 General
     Our Business
    1




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Our REIT Status
  Our Investment Objectives
  
    
    obtaining current income,
    
    making quarterly distributions,
    
    becoming and remaining qualified as a REIT for federal income tax purposes, and
    
    providing our stockholders with liquidity of their investment within
10 years after commencement of the offering, either through listing
our shares on a national securities exchange or on the Nasdaq stock
market or, if listing does not occur by December 31, 2017, commencing
the orderly liquidation of our assets and distributing the proceeds.
 Management Services
   Joint Venture Arrangements
   2




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Borrowing
     Loans
   Franchise Regulation
  Competition
    3




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Americans with Disabilities Act
  Employees
  Access to Information
   
 Item 1A. Risk Factors
 Risks Related to the Current Offering
 We own no properties at this time and must rely on Mr. Brad Honigfeld and his affiliates to
identify and purchase appropriate properties for us.
  We cannot assure you that we will acquire any suitable investments.
  We have no operating history for you to evaluate.
  The price of our shares is subjective and may not bear any relationship to what a stockholder
could receive if the shares were resold.
   4




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There may be delays in investing the proceeds of the offering, and this delay may decrease the
return to our stockholders.
  The actual amount of proceeds available for investment in properties is uncertain, and we cannot
guarantee that the investors will receive a specific return on their investment.
   If our properties do not generate sufficient revenue to meet operating expenses, our cash flow
and our ability to make distributions to stockholders will be adversely affected.
  
    
    increases in supply of hotel rooms that exceed increases in demand;
    
    increases in energy costs and other travel expenses that reduce business and leisure travel;
    
    reduced business and leisure travel due to continued geo-political uncertainty, including terrorism;
    
    adverse effects of declines in general and local economic activity;
    
    adverse effects of a downturn in the hotel industry; and
    
    risks generally associated with the ownership of hotels and real estate, as discussed below.
    5




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The sale of shares by stockholders may be difficult.
   
    
    no more than $100,000 of proceeds from the sale of shares pursuant to
any offering in any calendar quarter may be used to redeem shares (but
the full amount of the proceeds from the sale of shares under the
reinvestment plan attributable to any calendar quarter may be used to
redeem shares presented for redemption during such quarter and any
subsequent quarter), and
    
    no more than 5% of the number of shares of our common stock
(outstanding at the beginning of any 12-month period) may be redeemed
during such 12-month period.
 Some of the compensation to Orange Advisors and Orange Realty Group is payable before
distributions and, therefore, will tend to reduce the return on our stockholders investment.
  Investors purchasing shares after the first closing will pay a higher offering price per share
than investors purchasing shares at the first closing, resulting in immediate dilution to
investors purchasing after the first closing.
  Risks Related to Our Business
 Investors will be required to rely on our advisor, our executive officers and our board of
directors to manage Orange REIT and our results of operations will depend upon their management.
   6




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##### Table of Contents



We are dependent on Orange Advisors, which has no prior experience managing a real estate
investment trust.
  
    
    the appraised value of our assets on the termination date, less the
amount of all indebtedness secured by such assets, plus the total
distributions paid to stockholders from Orange REITs inception
through the termination date, exceeds
    
    invested capital plus an amount equal to the stockholders 8% return from inception through the termination date.
  Our taxable REIT subsidiary structure will subject us to the risk of increased hotel operating
expenses.
  
    
    wage and benefit costs,
    
    repair and maintenance expenses,
    
    energy costs,
    
    property taxes,
    
    insurance costs, and
    
    other operating expenses.
  There were no arms-length negotiations for our agreements with Orange Advisors and Orange Realty
Group, and the terms of those agreements may be more favorable to those entities, and to our
detriment, than had the negotiations been arms-length with third parties.
  Stockholders in Orange REIT may experience dilution.
   7




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Risks Related to Conflicts of Interest
 There are conflicts of interest with our Chairman and President because they have duties
to companies with which we may compete for properties.
   
    
    the loss or liability was the result of negligence or misconduct, or if the indemnitee is an independent director, the
loss or liability was the result of gross negligence or willful misconduct,
    
    the act or omission was material to the loss or liability and was committed in bad faith or was the result of active
or deliberate dishonesty,
    
    the indemnitee actually received an improper personal benefit in money, property, or services,
    
    in the case of any criminal proceeding, the indemnitee had reasonable cause to believe that the act or omission was
unlawful, or
    
    in a proceeding by or in the right of Orange REIT, the indemnitee shall have been adjudged to be liable to Orange REIT.
 We may compete with Orange Advisors, Orange Realty Group or their affiliates for properties.
  The timing of sales and acquisitions may favor Orange Advisors, Orange Realty Group or their
affiliates.
  Our fee structures may encourage our advisor or Orange Realty Group to recommend speculative
investments and a high amount of leverage.
   8




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Our affiliates may provide property development services to Orange REIT, for fees which may not
be determined at arms-length and which may encourage more development activity that if we used
unaffiliated developers.
  We may invest with affiliates of our advisor and enter into other transactions with them, which
may result in conflicts of interest which may not be resolved at arms-length.
  Mr. Honigfeld will spend time on other activities with other entities that may compete with us.
    Real Estate and Other Investment Risks
 Possible lack of geographic and hotel brand diversification increases the risk of investment
because our investment would be affected more quickly by an economic downturn in one or more
markets.
   The minimum size of the offering may result in lack of diversification and lower returns.
   9




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We do not have control over market and business conditions, which may adversely affect our
results of operations and reduce the funds available for distribution to stockholders.
  
    
    changes in general or local economic or market conditions,
    
    increased costs of energy,
    
    increased costs of insurance,
    
    increased costs of products,
    
    increased costs and shortages of labor,
    
    competitive factors,
    
    fuel shortages,
    
    quality of management,
    
    the ability of a hotel brand to fulfill any obligations to operators of its hotel business,
    
    limited alternative uses for the building,
    
    changing consumer habits,
    
    condemnation or uninsured losses,
    
    changing demographics,
    
    changing traffic patterns,
    
    inability to remodel outmoded buildings as required by the franchise or lease agreement,
    
    voluntary termination by a manager of its obligations under a
management agreement or by a tenant of its obligations under a lease,
or
    
    bankruptcy of a manager or tenant.
  We do not expect to operate our hotels and, as a result, we will be dependent on third-party
management companies.
  We may not be able to obtain or retain desirable franchise agreements, which could decrease our
revenue.
   10




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Adverse trends in the hotel industry may impact our properties, reducing our income and funds
available for distribution to stockholders.
  The risk of terrorism or future military activities in the United States or foreign countries may
adversely affect the travel and lodging industries, which could adversely affect our results of
operations and funds available for distribution to stockholders.
  Leasing properties to our subsidiary will subject us to conflicts of interest that could affect
our results of operations and funds available for distribution to stockholders.
   We will not control the management of our properties and our financial condition will be
dependent on the performance of our managers or tenants.
  Credit enhancements to our leases may not be available or, if available, will be subject to
termination and may also be subject to maximum limits.
   11




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We may not control the activities of joint ventures in which we enter, subjecting our investment
to the risks associated with their decisions.
  Joint venture partners may have different interests than we have and, as a result, they may be
willing to take greater risks or accept lower returns our management.
  It may be difficult for us to exit a joint venture after an impasse with our co-venturer.
  We may not have control over properties under construction and may be unable to control certain
construction risks.
  We will have no economic interest in ground lease properties and, as a result, we may not share
in any increase in value of the underlying land.
  Multiple management agreements with individual managers or property leases with individual
tenants increase our risks upon default.
   12




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It may be difficult to obtain a replacement manager for, or to re-lease, properties, and any
delay may reduce our income or funds available for distribution to stockholders.
   Tenants may control the sale of some properties, reducing our ability to freely control the sale
of those properties.
  Our hotel investments will be relatively illiquid and may adversely affect returns to our
stockholders.
  The liquidation of our assets may be delayed, which would defer the distribution of liquidating
distributions to stockholders.
   The hotel industry is seasonal, which may cause quarterly fluctuations in our results.
  Our hotel properties may be unable to compete successfully.
 
 Inflation could adversely affect our investment returns.
   13




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We may not have adequate insurance, which could result in uninsured losses, adversely affecting
our results of operations, financial position and funds available for distribution to
stockholders.
  Our properties may be subject to environmental liabilities, which could adversely affect our
results of operations, financial position and funds available for distribution to stockholders.
   Risks Related to Borrowing
 We may not be able to obtain adequate borrowing, reducing our ability to acquire properties and
achieve our investment objectives.
  Anticipated borrowing may impose operating and other restrictions on us and subject us to risks
of default.
   14




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We may borrow money to make distributions, placing us at risk of making distributions in excess
of our earnings and profits.
  Risks Related to Our Tax Status and Other Tax Related Matters
 An
investment in our common stock has various Federal income tax risks.
  If we fail to qualify as a REIT, our distributions will not be deductible by us, and our income
will be subject to taxation.
   If our leases are not respected as true leases for federal income tax purposes, we would fail to
qualify as a REIT.
  Utilization of taxable REIT subsidiary structure increases our overall tax liability.
 
   15




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Excessive non-real estate asset values may jeopardize our REIT Status.
   We may have to borrow funds or sell assets to meet our distribution requirements.
  Ownership limits may discourage a change in control.
  We are subject to other tax liabilities.
  Failure to make required distributions would subject us to additional tax.
  
    
    85 percent of our ordinary income for that year;
    
    95 percent of our capital gain net earnings for that year; and
    
    100 percent of our undistributed taxable income from prior years.
   16




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Changes in taxation of corporate dividends may adversely affect the value of our common stock.
  We may be required to pay a penalty tax upon the sale of a property.
  Changes in tax laws may prevent us from qualifying as a REIT.
  Miscellaneous Risks
 Our auditors reported to us that there was a material weakness in our internal controls over
financial reporting.
   If we fail to comply with the reporting obligations of the Securities Exchange Act of 1934 and
Section 404 of the Sarbanes-Oxley Act of 2002, or if we fail to achieve and maintain adequate
internal controls over financial reporting, our results of operations and financial condition,
and investors confidence in us, could be materially adversely affected.
   17




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We will incur significant costs to operate as a public company, and our management and key
employees will be required to devote substantial time to compliance initiatives.
  Our governing documents may discourage takeovers even if such a transaction might be favorable to
our stockholders.
  Majority stockholder vote provisions may discourage changes of control.
  Our board of directors can take many actions without stockholder approval.
  
    
    list our stock on a national securities exchange or on the Nasdaq stock market without obtaining stockholder approval;
    
    prevent the ownership, transfer and/or accumulation of shares in order to protect our status as a REIT;
    
    issue additional shares of stock without obtaining stockholder approval, which could dilute your ownership;
    
    change an advisors compensation and employ and compensate affiliates;
    
    direct our investments toward investments that will not appreciate
over time, such as building-only properties, with the land owned by a
third party; and
    
    establish and change minimum creditworthiness standards with respect to tenants.
  Our officers and directors have limited liability.
   18




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If our assets are deemed to be plan assets under ERISA, we may be subject to excise taxes.
  We make forward-looking statements in this annual report which may prove to be inaccurate.
   19




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Item 1B. Unresolved Staff Comments
  
 Item 2. Properties
  
 Item 3. Legal Proceedings
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 PART II
 
 Item 5. Market For the Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
 Common Shares
  Market Information
   Holders
  Sales of Unregistered Equity Securities and Repurchases
  Distribution Policy
    20




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Reinvestment Plan
  Redemption Plan
  
 Item 6. Selected Financial Data
   21




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Period from
    
    
    Period fromOctober 28,
    
    
    October 28,2005
    
    
    2005(inception)
    
    
    (inception)Year Ended
    
    
    Year Ended
    
    
    through
    
    
    throughDecember 31,
    
    
    December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005
    
    
    2007Revenues
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Operating expenses:Professional fees
    
    
    
    
    
    
    151,863
    
    
    
    2,549
    
    
    
    154,412Organizational expenses (to related party)
    
    
    
    
    
    
    210,000
    
    
    
    
    
    
    
    210,000General & administrative expenses
    
    
    480,355
    
    
    
    
    
    
    
    
    
    
    
    480,655Asset management fee (to related party)
    
    
    47,922
    
    
    
    
    
    
    
    
    
    
    
    47,922Interest expense (to related party)
    
    
    37,134
    
    
    
    11,919
    
    
    
    2,549
    
    
    
    49,053Total Operating Expenses
    
    $
    565,411
    
    
    $
    373,782
    
    
    $
    2,549
    
    
    $
    941,742Net loss
    
    $
    (565,411
    )
    
    $
    (373,782
    )
    
    $
    (2,549
    )
    
    $
    (941,742
    )Loss per common share
    
    $
    (42.40
    )
    
    $
    (28.03
    )
    
    $
    (0.19
    )Weighted-average common shares outstanding-basic and diluted
    
    
    13,334
    
    
    
    13,334
    
    
    
    13,334Balance Sheet DataCash and cash equivalents
    
    $
    4,443
    
    
    $
    4,110Capitalized Offering Costs
    
    
    1,192,213
    
    
    
    797,773Total assets
    
    
    1,204,660
    
    
    
    801,883Accrued expenses to related party (a)
    
    
    585,947
    
    
    
    Note payable to related party
    
    
    1,120,053
    
    
    
    551,919Shareholders
(deficit) equity
    
    
    (741,733
    )
    
    
    (176,322
    )
 (a)
    
    Accrued Expenses to related party represents amounts to be reimbursed to Orange Advisors, LLC
pursuant to our Advisory Agreement  22




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
 This annual report contains forward-looking statements, including statements regarding our
business strategies, future capital needs, our business, and the industry in which we operate.
These forward-looking statements are based primarily on our expectations and are subject to a
number of risks and uncertainties, some of which are beyond our control. Such factors include the
ability of the Company to implement its acquisition strategy and operating strategy; the Companys
ability to manage planned growth; changes in economic cycles and competition within the
extended-stay hotel industry. Although the Company believes that the assumptions underlying the
forward-looking statements contained herein are reasonable, any of the assumptions could be
inaccurate, and therefore there can be no assurance that such statements included in this Annual
Report will prove to be accurate. In addition, the Companys qualification as a real estate
investment trust involves the application of highly technical and complex provisions of the
Internal Revenue Code. Readers should carefully review the Companys financial statements and the
notes thereto, as well as the risk factors described in the Companys filings with the Securities
and Exchange Commission. Words such as believes, anticipates, expects, intends, plans,
and similar expressions are intended to identify forward-looking statements, but are not the
exclusive means of identifying such statements.
    Critical Accounting Policies
 Consolidation
  Allocation of Purchase Price for Acquisition of Real Estate
   23




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Impairments
  Leases
   Acquisition Fees and Costs
  Revenue Recognition
  Income Taxes
   Results of Operations
    24




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Liquidity and Capital Resources
      25




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Proposed Revolving Credit Facility
        26




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Recent Accounting Pronouncements
  Off-Balance Sheet Arrangements
  
 Item 7A. Quantitative and Qualitative Disclosure About Market Risk
    
 Item 8. Financial Statements and Supplementary Data
  27




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ORANGE REIT, INC
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 PageReports of Independent Registered Public Accounting Firms
    
    
    29Consolidated Balance Sheets at December 31, 2007, December 31, 2006, and December 31, 2005
    
    
    31Consolidated Statements of Operations for the years ended December 31, 2007, December
31, 2006, the period from October 28, 2005 (inception) through December 31, 2005 and the
period from October 28, 2005 (inception) through December 31, 2007
    
    
    32Consolidated
Statements of Stockholders (Deficit) Equity for the years ended December 31,
2007, December 31, 2006, the period from October 28, 2005 (inception) through December
31, 2005, and the period from October 28, 2005 (inception) through December 31, 2007
    
    
    33Consolidated
Statements of Cash Flows for the years ended December 31, 2007, December 31, 2006, the
period from October 28, 2005 (inception) through December 31, 2005, and the period from
October 28, 2005 (inception) through December 31, 2007
    
    
    34Notes to Consolidated Financial Statements
    
    
    35
  28




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Report of Independent Registered Public Accounting Firm
 
     
  29




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
      
  30




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ORANGE REIT, INC.
(A Development Stage Maryland Corporation)
 
 CONSOLIDATED BALANCE SHEETS
 December 31,
    
    
    December 31,2007
    
    
    2006AssetsCash and cash equivalents
    
    $
    4,443
    
    
    $
    4,110Deposits
    
    
    5,874
    
    
    
    Property and equipment, net
    
    
    2,130
    
    
    
    Capitalized offering costs
    
    
    1,192,213
    
    
    
    797,773Total Assets
    
    $
    1,204,660
    
    
    $
    801,883Liabilities:Accounts payable
    
    $
    240,393
    
    
    $
    426,286Accrued
expenses (to related party)
    
    
    585,947
    
    
    
    Note payable
(to related party)
    
    
    1,120,053
    
    
    
    551,919Total Liabilities
    
    
    1,946,393
    
    
    
    978,205Commitments
and contingencies
    
    
    
    
    
    
    Stockholders
(Deficit) Equity:Common stock, $.01 par value; authorized
40,000,000 and 100,000 shares; issued and outstanding 13,334
shares
    
    
    133
    
    
    
    133Additional paid-in-capital
    
    
    199,876
    
    
    
    199,876(941,742
    )
    
    
    (376,331
    )Total
Stockholders (Deficit) Equity
    
    
    (741,733
    )
    
    
    (176,322
    )Total
Liabilities and Stockholders (Deficit) Equity
    
    $
    1,204,660
    
    
    $
    801,883
   31




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ORANGE REIT, INC.
(A Development Stage Maryland Corporation)
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 Period from
    
    
    Period fromOctober 28,
    
    
    October 28,2005
    
    
    2005(inception)
    
    
    (inception)Year Ended
    
    
    Year Ended
    
    
    through
    
    
    throughDecember 31,
    
    
    December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005
    
    
    2007Revenues
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Operating expenses:Professional fees
    
    
    
    
    
    
    151,863
    
    
    
    2,549
    
    
    
    154,412Organizational expenses (to related party)
    
    
    
    
    
    
    210,000
    
    
    
    
    
    
    
    210,000Interest expense (to related party)
    
    
    37,134
    
    
    
    11,919
    
    
    
    
    
    
    
    49,053Asset management fee (to related party)
    
    
    47,922
    
    
    
    
    
    
    
    
    
    
    
    47,922General & administrative expenses
    
    
    480,355
    
    
    
    
    
    
    
    
    
    
    
    480,355Total Operating Expenses
    
    $
    565,411
    
    
    $
    373,782
    
    
    $
    2,549
    
    
    $
    941,742Net loss
    
    $
    (565,411
    )
    
    $
    (373,782
    )
    
    $
    (2,549
    )
    
    $
    (941,742
    )Basic and
diluted loss per share
    
    $
    (42.40
    )
    
    $
    (28.03
    )
    
    $
    (0.19
    )Weighted
average number of shares outstanding Basic and diluted
    
    
    13,334
    
    
    
    13,334
    
    
    
    13,334
   32




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ORANGE REIT, INC.
(A Development Stage Maryland Corporation
 
 CONSOLIDATED
STATEMENTS OF STOCKHOLDERS (DEFICIT) EQUITY
 DeficitAccumulatedCommon Stock
    
    
    
    
    
    
    During theNumber of
    
    
    
    
    
    
    Additional
    
    
    DevelopmentShares
    
    
    Amount
    
    
    Paid-Capital
    
    
    Stage
    
    
    TotalInitial capitalization October 28, 2005
    
    
    13,334
    
    
    $
    133
    
    
    $
    199,876
    
    
    $
    
    
    
    $
    200,009Net loss for the period from October
28,2005 (inception) through December 31,2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,549
    )
    
    
    (2,549
    )Balance at December 31, 2005
    
    
    13,334
    
    
    
    133
    
    
    
    199,876
    
    
    
    (2,549
    )
    
    
    197,460Net loss for the year ended December
31, 2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (373,782
    )
    
    
    (373,782
    )Balance at December 31, 2006
    
    
    13,334
    
    
    $
    133
    
    
    $
    199,876
    
    
    $
    (376,331
    )
    
    $
    (176,322
    )Net loss for the year ended December
31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (565,411
    )
    
    
    (565,411
    )Balance at December 31, 2007
    
    
    13,334
    
    
    $
    133
    
    
    $
    199,876
    
    
    $
    (941,742
    )
    
    $
    (741,733
    )
   33




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##### Table of Contents



ORANGE REIT, INC.

(A Development Stage Maryland Corporation)
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 Period from
    
    
    Period fromOctober 28,
    
    
    October 28,2005
    
    
    2005(inception)
    
    
    (inception)Year Ended
    
    
    Year Ended
    
    
    through
    
    
    throughDecember 31,
    
    
    December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005
    
    
    2007Cash Flows from Operating Activities:Net loss
    
    $
    (565,411
    )
    
    $
    (373,782
    )
    
    $
    (2,549
    )
    
    $
    (941,742
    )Adjustments to reconcile net loss to net cash used in
operating activities:Non-cash expenses (to related party)
    
    
    
    
    
    
    210,000
    
    
    
    
    
    
    
    210,000Depreciation expense
    
    
    1,064
    
    
    
    
    
    
    
    
    
    
    
    1,064Increase in accrued interest (to related party)
    
    
    37,133
    
    
    
    11,919
    
    
    
    
    
    
    
    49,052Increase in other assets
    
    
    (5,874
    )
    
    
    
    
    
    
    
    
    
    
    (5,874
    )Increase in accounts payable and accrued expenses
(excluding
 capitalized offering
costs)
    
    
    458,150
    
    
    
    75,201
    
    
    
    2,549
    
    
    
    535,900Net Cash Used in Operating Activities
    
    
    (74,938
    )
    
    
    (76,662
    )
    
    
    
    
    
    
    (151,600
    )Cash Flows from Investing Activities:Additions to property and equipment
    
    
    (3,195
    )
    
    
    
    
    
    
    
    
    
    
    (3,195
    )Payment of offering costs
    
    
    (256,534
    )
    
    
    (349,238
    )
    
    
    
    
    
    
    (605.772
    )Net Cash Flows Used in Investing Activities
    
    
    (259,729
    )
    
    
    (349,238
    )
    
    
    
    
    
    
    (608.967
    )Cash Flows from Financing Activities:Proceeds from the issuance of common stock
    
    
    
    
    
    
    
    
    
    
    200,010
    
    
    
    200,010Advances from Briad for offering costs
    
    
    335,000
    
    
    
    230,000
    
    
    
    
    
    
    
    565,000Net Cash Flows From in Financing Activities
    
    
    230,000
    
    
    
    230,000
    
    
    
    200,010
    
    
    
    765,010Net Increase (Decrease) in Cash and Cash Equivalents
    
    
    333
    
    
    
    (195,900
    )
    
    
    200,010
    
    
    
    4,443Cash and Cash Equivalents, Beginning of Period
    
    
    4,110
    
    
    
    200,010
    
    
    
    
    
    
    
    Cash and Cash Equivalents, End of Period
    
    $
    4,443
    
    
    $
    4,110
    
    
    $
    200,010
    
    
    $
    4,443Supplemental Disclosure of Non-Cash Activity:Capitalized offering costs accrued as payable
    
    $
    240,393
    
    
    $
    348,535
    
    
    $
    134,279
    
    
    $
    240,393Capitalized offering costs paid directly by related party
    
    $
    246,048
    
    
    $
    50,000
    
    
    $
    50,000
    
    
    $
    346,048
   34




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##### Table of Contents



ORANGE REIT, INC.
(A Development State Maryland Corporation)
 
 NOTES TO FINANCIAL STATEMENTS
 1. Organization
        2. Summary of Significant Accounting Policies
 Basis of Presentation
  Liquidity
   35




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##### Table of Contents



ORANGE REIT, INC.
(A Development Stage Maryland Corporation)
NOTES TO FINANCIAL STATEMENTS(Continued)
 2. Summary of Significant Accounting Policies, continued
 Use of Estimates
  Cash and Cash Equivalents
  Hotel Properties
  Offering Costs
  Impairment of Long-Lived Assets
  Revenue Recognition
  Lease Accounting
   36




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##### Table of Contents



ORANGE REIT, INC.
(A Development Stage Maryland Corporation)
NOTES TO FINANCIAL STATEMENTS(Continued)
 2. Summary of Significant Accounting Policies, continued
   Earnings Per Common Share
  Recent Accounting Pronouncements
 Accounting for
Uncertainty in Income Taxes  an interpretation of FASB Statement No. 109
 Definition of Settlement in
FASB Interpretation No. 48
 Business Combinations
 Noncontrolling Interests in Consolidated
Financial Statements, an amendment of ARB No. 51
  37




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##### Table of Contents



ORANGE REIT, INC.
(A Development Stage Maryland Corporation)
NOTES TO FINANCIAL STATEMENTS(Continued)
 2. Summary of Significant Accounting Policies, continued
 Fair Value Measurements
 3. Income Taxes
    4. Stockholders Equity and Offering of Shares
     Offering and Start Up Costs
     38




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##### Table of Contents



ORANGE REIT, INC.
(A Development Stage Maryland Corporation)
NOTES TO FINANCIAL STATEMENTS(Continued)
 Accrued Expenses to Related Party
  5. Related Parties
  Orange Realty Group, LLC
  Orange Advisors, LLC
      Briad Development West, LLC
   39




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##### Table of Contents



ORANGE REIT, INC.
(A Development Stage Maryland Corporation)
NOTES TO FINANCIAL STATEMENTS(Continued)
 5. Related Parties, continued
 Briad Development West, LLC, continued
   6. Commitments and Contingencies
   7. Subsequent Events
    8. Quarterly Financial Data (unaudited)
  First Quarter
    
    
    Second Quarter
    
    
    Third Quarter
    
    
    Fourth QuarterRevenues
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net (loss)
    
    
    (100,026
    )
    
    
    (191,481
    )
    
    
    (124,204
    )
    
    
    (149,700
    )Basic and diluted (loss) per common share
    
    
    (7.50
    )
    
    
    (14.36
    )
    
    
    (9.31
    )
    
    
    (11.23
    )
  40




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##### Table of Contents



Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures
       
 Item 9A(T). Controls and Procedures
      41




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##### Table of Contents



Managements Report on Internal Control Over Financial Reporting
  Changes in Internal Control over Financial Reporting
  
 Item 9B. Other Information
  
 PART III
 
 Item 10. Directors, Executive Officers and Corporate Governance
 Executive Officers and Directors
 Name
    
    Age
    
    Position with Orange REITBrad Honigfeld
    
    
    48
    
    
    Chairman and DirectorRobbin E. Cooper
    
    
    38
    
    
    PresidentScott Lipkin
    
    
    48
    
    
    DirectorMark R. Stebbins
    
    
    53
    
    
    DirectorCynthia A. Ward
    
    
    47
    
    
    Chief Financial Officer and TreasurerSteven I. Scharf
    
    
    45
    
    
    Vice PresidentAcquisitions and Asset Management
 Brad Honigfeld
  42




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##### Table of Contents



Robbin E. Cooper
 CSX
Award of Excellence
  Scott Lipkin
 Mark R. Stebbins
 Cynthia A. Ward.
  43




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##### Table of Contents



Steven I. Scharf
  Code of Ethics
  Committees of the Board of Directors
    Our Advisor
   Name
    

Position with Orange AdvisorsBrad Honigfeld
    
    Chairman and ManagerRobbin E. Cooper
    
    PresidentCynthia A. Ward
    
    Chief Financial Officer and TreasurerSteven I. Scharf
    
    Vice PresidentAcquisitions and Asset Management
     44




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##### Table of Contents



Orange Realty Group
  Name
    
    Position with Orange Realty GroupBrad Honigfeld
    
    Chairman and ManagerRobbin E. Cooper
    
    PresidentCynthia A. Ward
    
    Chief Financial Officer and TreasurerSteven I. Scharf
    
    Vice PresidentAcquisitions and Asset Management
  
 Item 11. Executive Compensation
 Executive Officers
  Director Compensation
 Director Compensation Table
 Change inpension valueandnonqualifiedFees earned
    
    
    
    
    
    
    
    
    
    
    Non-equity
    
    
    deferredor paid
    
    
    
    
    
    
    Option
    
    
    incentive plan
    
    
    compensation
    
    
    All otherin cash
    
    
    Stock awards
    
    
    awards
    
    
    compensation
    
    
    earnings
    
    
    compensation
    
    
    TotalName
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)(a)
    
    (b)
    
    
    (c)
    
    
    (d)
    
    
    (e)
    
    
    (f)
    
    
    (g)
    
    
    (h)Brad Honigfeld
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Scott Lipkin
    
    
    5,200
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,200Mark R. Stebbins
    
    
    5,400
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,400
   45




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##### Table of Contents



Compensation Committee Interlocks and Insider Participation
  
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
 Security Ownership of Certain Beneficial Owners and Management
   Amount andNature ofBeneficial
    
    PercentTitle of Class
    
    Name and Address of Beneficial Owner
    
    Owner
    
    of ClassCommon stock
    
    Brad Honigfeld
c/o Briad Development West LLC
78 Okner Parkway
Livingston, NJ 07039
    
    13,334 shares(1)
    
    
    100
    %
 
 (1)
    
    Shares are owned of record by Briad Development West LLC. Mr.
Honigfeld owns all of the interests in, and serves as the sole manager
of, Briad Development West LLC and therefore may be deemed to
beneficially own the shares held by Briad Development West LLC. Equity Compensation Plan Information
  
 Item 13. Certain Relationships and Related Transactions, and Director Independence
 Transactions with Related Persons, Promoters and Certain Control Persons
 Transactions with Related Persons
    46




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47




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##### Table of Contents



Review, Approval or Ratification of Transactions with Related Persons
  Sale to Company
 Sale or Lease by Company
 Loans
 Investments
 Other
 Director Independence
    48




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##### Table of Contents



Item 14. Principal Accounting Fees and Services
  Audit Fees
    
    
    Audit-Related Fees
    
    
    Tax Fees
    
    
    Other Fees2007Grant Thornton LLP
    
    $
    82,400
    
    
    $
    7,800
    
    
    
    
    
    
    
    Daszkal Bolton LLP
    
    $
    38,000
    
    
    
    
    
    
    
    
    
    
    
    2006Grant Thornton LLP
    
    $
    134,354
    
    
    
    
    
    
    $
    4,700
    
    
    
    Daszkal Bolton LLP
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 Audit Fees
  Audit-Related Fees
  Tax Fees
  All other Fees
  
 PART IV
 
 Item 15. Exhibits, Financial Statement Schedules
            49




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##### Table of Contents



Supplemental Information to be Furnished With Reports Filed Pursuant to Section 15(d) of the Act by
Registrants Which Have Not Registered Securities Pursuant to Section 12 of the Act
 
  50




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##### Table of Contents



SIGNATURES
  ORANGE REIT, INC.By:
    
    /s/ Brad Honigfeld
    
    Date: March 31, 2008Brad HonigfeldChairman
(Principal Executive Officer)By:
    
    /s/ Cynthia Ward
    
    Date: March 31, 2008Cynthia WardChief Financial Officer(Principal Financial and Principal Accounting Officer)
  By:
    
    /s/ Brad Honigfeld
    
    Date: March 31, 2008Brad Honigfeld, DirectorBy:
    
    /s/ Mark R. Stebbins
    
    Date: March 31, 2008Mark R. Stebbins, DirectorBy:
    
    /s/ Scott Lipkin
    
    Date: March 31, 2008Scott Lipkin, Director
  51




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description Of Documents3.1
    
    
    Form of Amended and Restated Articles of
Incorporation of the Registrant
(Incorporated by reference to Exhibit 3.1
to Amendment No. 3 to the Registrants
Registration Statement on Form S-11 (SEC
File No. 333-131677) filed on February 7,
2007)3.2
    
    
    Bylaws of the Registrant (Incorporated by
reference to Exhibit 3.2 to Amendment No. 2
to the Registrants Registration Statement
on Form S-11 (SEC File No. 333-131677)
filed on January 17, 2007)3.3
    
    
    Amendment to Bylaws of the Registrant
(Incorporated by reference to Exhibit 3.3
to Post-Effective Amendment No. 3 to the
Registrants Registration Statement on Form
S-11 (SEC File No. 333-131677) filed on
February 7, 2008)4.1
    
    
    Form of Promissory Note to Briad
Development West LLC (Incorporated by
reference to Exhibit 4.1 to Amendment No. 2
to the Registrants Registration Statement
on Form S-11 (SEC File No. 333-131677)
filed on January 17, 2007)10.1
    
    
    Advisory Agreement between the Registrant
and Orange Advisors, LLC (Incorporated by
reference to Exhibit 10.1 to Form 10-Q for
the fiscal quarter ended March 31, 2007
filed on May 15, 2007)10.2
    
    
    Property Acquisition/Disposition Agreement
between the Registrant and Orange Realty
Group, LLC (Incorporated by reference to
Exhibit 10.2 to Form 10-Q for the fiscal
quarter ended March 31, 2007 filed on May
15, 2007)10.4
    
    
    Memorandum of Business Terms among Orange
Advisors, LLC, Orange Realty Group, LLC and
Robbin E. Cooper (Incorporated by reference
to Exhibit 10.4 to Amendment No. 3 to the
Registrants Registration Statement on Form
S-11 (SEC File No. 333-131677) filed on
February 7, 2007)10.5
    
    
    Term Sheet between M&T Bank and Orange
REIT, Inc. (Incorporated by reference to
Exhibit 10.5 to Amendment No. 2 to the
Registrants Registration Statement on Form
S-11 (SEC File No. 333-131677) filed on
January 17, 2007)14.1
    
    
    Code of Ethics*21.1
    
    
    Subsidiaries of the Registrant
(Incorporated by reference to Exhibit 21.1
to Amendment No. 2 to the Registrants
Registration Statement on Form S-11 (SEC
File No. 333-131677) filed on January 17,
2007)31.1
    
    
    Certification of the Companys Principal
Executive Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 2002*31.2
    
    
    Certification of the Companys Chief Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002*32.1
    
    
    Certification of the Companys Principal Executive Officer pursuant
to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002*32.2
    
    
    Certification of the Companys Chief Financial Officer pursuant to
18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002*
 
 *
    
    Filed herewith