Q3 2020 FRP Holdings Inc Earnings Call
[music].
Other.
Then as imposed by law as a result of future events or new information.
Thank you for joining us.
This morning, we appreciate your interest in FRP.
Net income for the quarter.
For the third quarter of 2020 was 5.455 million or 57 per share.
Verses 2.001 million or 20 per share in the same period last year the.
The third quarter results were impacted by the following items.
Interest expense decreased 83000, as we capitalize more interest on our joint venture construction projects.
Los on joint venture increased 1.042 million because of.
A 1.129 million dollar operating off at the mirror and due to leasing efforts.
And a gain of 5.732 million.
From the sale of our building at the Hollander business Park and the sale of 87 acres of our Fort Myers property as a result of the county.
<unk> sizing there option for right of way, which will.
$35000 up $195000 from an operating loss of $160000 in the same period last year, primarily due to our new spec building at 18 or 162nd Street, reaching 100% occupancy and continued increased occupancy Cranberry Roe.
Selling a 147000 square feet. The two industrial buildings are planned for delivery in the third quarter of 2021.
Two phase one of our joint venture with St. John's properties, consisting of four buildings totaling 72080 square feet of single storey office and 27950 square feet of small bay retail space in Baltimore County.
Marilyn saw some activity this quarter as our percentage leased increased to 47% with the addition of the projects first retail tenant.
Entitlements continue for our project in Hampstead, Marilyn known as Hampstead, overlook, which receive concept plan approval. This spring for the 255 single family and town House building large proposed.
We are currently seeking preliminary plan approval from the town and the County. This is a critical step in moving the development forward and a prerequisite for final plan approval, which secures the entitlements necessary to develop the project.
14 storey mixed use development consists of 264 apartments.
6937 square feet first floor retail.
During the third quarter Marin received 100% of its use in occupancy certificates and has seen robust leasing activity, increasing from 45% leased and 23% occupied at the end of June.
To 76.14% leased and 68.94% occupied at the end of the third quarter.
The retail component to 74% leased with the large retail suite totaling five.
Thousand 111 square feet, signing a tenant at the end of the second quarter.
Alright with them or pay for the development of a mixed use project known as 1800 half Street.
Development is located in the Buzzard point area of Washington D C.
Less than half a mile down river from Doc 79 and marriage.
It lies directly between our two acre site on the Anacostia currently under least by Vulcan materials, an Audi field the.
The home stadium of the D C United professional soccer team.
The 10 story structure will house, 344 apartments, and 11246 square feet of ground floor retail.
The project is a qualified opportunities own investments and we'll differ a bit over $10 million in taxes associated with 2018 warehouse platform, saying.
In June we closed on the 74 million dollar construction long and subsequently began construction at the end of August of this year, we expect to deliver this project in the fourth quarter of 2022.
In addition to 1800 half Street and also in December of 2019, we ventured outside of Washington D. C and entered into two joint venture agreements with Woodfield development a.
A strategic new card.
To invest in two separate and distinct residential development projects in Greenville, South Carolina.
Woodfield has vast experience developing residential mixed use projects throughout the southeast in Washington D C.
The first project called Riverside is at 200 unit apartment project kind of looks at four P contributed $6.2 million gonna change for a 40% ownership amateurs.
Construction began during the first quarter of this year and is expected to be complete in the third quarter of 2021.
This is a qualified opportunities own investments.
Our second project with Woodfield is at 227 unit mixed use development entitled.
<unk> four O eight Jackson.
Not to Shoeless, Joe Jackson, who actually lived on this site.
And which is adjacent to Greenville Minor League Baseball Stadium, which houses an affiliate of the Boston Red Sox.
This project will also include 4700 square feet of retail space.
The retail component of dock 79.
Which totals approximately 14600 square feet remain at 76% occupied and 76% leased as of the end of the quarter.
Unfortunately.
Our retail tenants were shut down from March 16th through the end of June as a result of the COVID-19 pandemic.
With exception of one of the restaurants being partially open for carry out.
All three retail tenants are now open, albeit nowhere near the normal occupancy.
Brent payments have resumed for the most part arc.
The ownership of 62%.
And finally relative to the new asset introduced to.
This business segment in July of last year or.
294 unit Hickory Creek apartment complex in Richmond, Virginia things remain status quo in the third quarter with average occupancy running above 94% the.
The distribution was on time and for the anticipated about of $86000 or 6 million dollar investment in this project is apart. The 10 31 like kind exchange complex was constructed in 1984 and substantially renovated in 2016.
The business plan calls for further refurbishments to the interiors departments and the increasing a wrench prior to sailing the project at a greater value after inappropriate hold period.
F. R. P is fortunate to have a focused and talented team that has recently been quite active and lacing development and sales across multiple business segments.
However, it's important to note.
That like the rest of the world we've changed due to Covid.
Our operations communications workflow and access have all been altered.
We're committed to our mission.
And remain mindful of the unprecedented impact Kobe is having on us all.
We are considered an essential business and continue to operate at full capacity, while hating the guidance of the federal government and orders issued by the state and local authorities are.
Our offices in Baltimore, Maryland are open for limited activities on site and all employees are set up to operate fully from their homes.
Glen required our employees are physically distancing in employing other measures to ensure the protection of the folks with whom we interact as we go about our business.
At the end of the first quarter requests for forbearance were limited to four tenants.
Three retail restaurants, the Doc 79, and one small office tenants, whose business focus was related to hotel services.
At the end of the second quarter, all but one of the apprehension tenants had made significant project brown progress towards clearing right.
Rents and expenses.
By the end of the third quarter laudable progress in working through appropriate payment schedules has continued to.
To be sure <unk> is not unscathed by COVID-19.
However, the retail tenants of dark 79 currently represent a total of 6% of the company's net operating income and for the time being appear to be furring better than most in their category.
Our tenants continue to operate so perhaps on revise schedules and conditions and with few exceptions continue to pay rent as usual.
We are mindful of the challenges that are facing our tenants partners and employees every day and we strive to be good stewards of our stockholder state as well as the trust and support of our business partners.
COVID-19 marks a new beginning and will change the way, we have the hey personally and professionally.
But with all challenges come an opportunity.
Lastly, I would encourage everyone to visit our newly minted website at W. W. W. F. R. P. D E V Dot com, which now better reflects the company we have become the investments we make in the future we sink.
Thank you.
I'll now turn the call back to John.
Oh, Thank you David I think let's see we have been.
Very busy in redeploying the funds from the warehouse sale.
Still we remain very liquid because of asset sales and strong cash generation.
We have not been badly hurt by Covid, but we are mindful that we are by no means out of the woods are strong balance sheet gives us confidence that we can grow.
At a measure great.
While knowing that we have the dry power to face an uncertain future. We appreciate your confidence and will now open for up to any questions.
Thank you at this time I'd like to open up for questions. If you would like to ask a question. Please press the stocky followed by the one key on your Touchtone phone now question can be taken in which dealt with any of them I see okay. Anytime you need to remove yourself from a question on here.
I start can again that is star one traffic and how to your question.
My first question would be fun.
From my mom partner.
Oh, Oh gosh.
Hey, Bellevue, Hey, Bill how are you.
Okay. Good.
Yeah, <unk> what to connect with you guys I got a few questions, but first of all I'm Islam Dot 79.
I I looked at the queue to <unk> and occupancy, which is 92% these and 90% occupied and cute three leasing won't down by 1.6% occupancy in 543 could you just help me interpret like what that means when <unk> and that one.
Six and Occupancies at 4.3.
It's it's not obvious.
Yeah.
The the reason for that kind of quirky disparity is that I think when we are two months out from our lease being renewed if the least has not yet been renewed then we do not count it count that unit at least but it <unk>.
<unk> occupied.
Okay.
So if from a economic perspective like that.
Is it is it.
It is boxing nine trending lower or higher [laughter] I guess it was a question I'm trying to ask.
<unk> based on these 2223 numbers.
I think it spills de <unk> <unk> <unk> it has been a little a slightly off and.
In predominantly because of the you know the the retail.
This is not operating at 100%.
Occupancy.
And so we're not where it was a little bit you did not get the O bridges and rent payments that we did last year because of the baseball and just the success of the retail tenants and also the parking that we get from from people driving to the baseball games to the soccer games and also to the retail components.
We're not getting that right now either.
So we'd like to think that all of that will wrap itself back up in you know the spring, but the good thing is is that the occupancy seems to it seems to be holding for example, I think at the end of.
At the end of.
October.
We were.
94% occupied and we were a little over 93% leashed.
So we think that we think that we're furring, the the pandemic pretty well down there, but the the rent freeze obviously is an issue in that looks like it's gonna for a renewables.
That looks like that could probably creep over into the first quarter of 2021, and possibly a little bit longer we just don't though.
Gotcha, and if I can have a follow up.
On the retail you know I was I was down there in August and.
Obviously very lovely area, then the summer by the waterfront, but as we go into the winter season.
And there's no baseball any thoughts on kind of the the retail tenants three reset tenants their ability to whether the the the Q1 2121.
[noise] generally build a you know there there there lesser profitable months for them from November through March.
One of the things that every body is doing and far more so is there trying to make the exterior spaces.
Usable, which is not something that they really spent a lotta time on before we have an extensive amount of outside area. As you probably know so all of the tenants are using as much of the space is we can offer them.
Create areas, where people can you know can can come eat and drink outside I think we have probably is for Friday get a hold on the market for propane heaters, but that's one of the things that they're all really working towards because that seems to be a much more safer and much more usable way to to keep these restaurants performing as best they can.
<unk>.
Can I ask other questions or do you want me to go back to the queue.
Keep going if you want.
Sure Okay on the aggregate business I'm in phenomenal performance about how do I think about what what do you know how much of that is driven by commercial construction versus single family construction versus all sorts of infrastructure and.
And you know as I think about commercial construction what is it my understanding of that if the project for in place already you keep going but but I don't think anyone is starting any commercial crossword construction right now.
We got to see some sort of you know drop off effects on the commercial side you know the single family size seems to be Sean and that seems to be the case for quite some time. So any thoughts on how do we think about the aggregate business going forward.
There's.
<unk>.
I'm happy to answer the question there's a.
You know the the kind of traditional breakdown of.
Oh, what kind of jobs drive you know aggregate sales is.
Am single family homes, commercial construction, and and then infrastructure and.
And one of the reasons that.
Florida is set.
Great aggregates market is that <unk>.
Compared to other states single family homes home construction.
R. A much stronger uhm component of that next then.
You know then.
Your other states so.
Obviously.
We have no idea of what the future holds but.
The.
I think then as people want to get out of in bigger cities and and to kind of the Sun belt areas like Florida, HM HM Yeah because of Covid.
Florida, which is a huge part of our.
Aggregate assets is going to benefit tremendously from that and and Georgia as well.
Gotcha.
Gotcha.
Oh, that's that's very helpful. Thank you very much.
Yeah.
My final question would be and and you know and then we got.
He got one final question, then I I can I can follow up I'll fly is that.
The I'm, Brian Street in 1800 half Street.
What are the thoughts Amanda Knox heavy nightmare and done well relative to the D C market, but Brian Street in 18, Harvard Street doesn't necessarily have the luxury of that both of those locations.
<unk> are you guys revising downward or how how are you thinking about what the right achievable versus what you guys have previously underwrote those projects to you give it in the you know I think I think New York City is San Fran rent, you know I've seen rent down 15%, but D C.
I think I've seen somewhere in the high single digits.
And obviously Occupancies Lola.
But any any kind of thoughts on what's it like bold bright street in and bomb.
And they can either have street as we bring that to market.
I guess.
This is David <unk>, obviously, when we got into these projects.
We weren't we weren't anticipating something like Covid, but I think the underlying you know possibilities are still there they might just be pushed out a little bit I mean <unk> <unk>.
Jax, you know or opportunity zone assets and so.
Just by their very nature, we were pretty conservative N R. Estimating Lisa and also of the initial rent structures because they are in pioneering areas right and and so.
For example, Bryant Street, it's not really gonna be open for leasing other than the small building of 150 units just because that's how the construction process is going.
You know until next summer.
Oh, and the and the thing that drives you know that area. Obviously is public transportation I mean, we literally the the red line literally dumps right out the.
The second station north of Unionization, and and there's just not that many people dry you know riding the public transportation right now so it's gonna be slow as you go but we're still you know very optimistic about the long term aspects of that and also for half Street.
You know the area, it's still there and.
Have streets, a little different because we would put half street, a little bit more along the lines of the.
Hope to be successful was the bright as the Mehrens and docks, but.
You know down there you've got the water you've got you've got sports and then probably even gambling down in that area. So you've got a lot of different things that I want to keep that area kind of moving forward.
And again, Brian streets, a little different but it's a transit oriented program and like everyone knows the transit oriented programs are are are you know under a little bit of scrutiny right now in the short term because of Covid, but.
We we were we were cautiously optimistic going in we still remain cautiously optimistic and we have had we're looking at some that's that at least in our underwriting we were planning on a fairly substantial least up time.
Okay, one pull up on the 18th of a Hot Street Uhm.
I've been down there I looked at that site is there any way that we can work with Vulcan getting an easement on the waterfront. So that so that people could cuddle walk towards the navy or from from there rather than like going around is is that a possibility.
Well probably not so.
Everything is a possibly not probably not [laughter].
[laughter].
But.
Okay, <unk> and you can drive already Mexico.
With that.
Oh, let's do you have a commercial driver's license and you can drive a ready mix truck, that's probably not going to let you on the site.
Oh, Yeah, I mean, there there there's no way, where you could cut out office on financial incentive because I'm, assuming that if if if we wait till polling place six four.
To vacate the space. So that you can call like walk along the water may make financial sense to get that bill sooner rather than than five six years.
I think it also has to do with what's going on around us two weeks.
We're looking at we're looking at the at the other the other properties and the other property owners you know that are better kind of surround the bulk of the you know our site on the <unk> the river and that'll be different ways to access riverfront, it just won't be across Balkans property.
Gotcha Gotcha.
Gotcha well those are all the questions that I have and I'll follow up offline out with you guys I I'll, let others ask questions.
Okay. Thanks, Bill Funky.
Our next question I mean from Stephen Farrell from Oppenheimer.
Hi, guys can you hear me.
I see them Sir.
How I it was a relatively quiet corner in respect to new projects. Besides the construction beginning on the Honda or a business Park.
Was this more related to confidence an existing projects.
We have a lot of projects under development now as you know from the apartment side.
I thought it was a relative to development. We are we are massively under development with as I told as I mentioned in my remarks, and the apartment side and.
We it took a while to get the building permits from Baltimore City in order to be able to start the new.
The new two buildings and.
But hollander business Park, and we have a couple of he.
Pieces of ground under contract.
Right now that we're looking at the possibility of increasing the the warehouse platform once again from an opportunistic standpoint so.
Even though the I guess the operating incomes, we're a little bit we're a little flat the development. So I just go on about as fast as it could go.
Mhm.
And you know you mentioned that the residential projects in inventory remains tight and do.
Do you feel sort of a sense of urgency to get those to market.
Market is supportive.
Well, yes, we have we we have actually three of them two of them. What's your lending ventures. Both of those we sold one of them we were under contract with National Homebuilders on the other one and we have some substantial deposits from them for that one the third one wishes the.
Hampstead overlooked which has been tough because we had to change the zoning on that from a doster y'all to residential and we have to be the criteria of both the town and the county, which is always an interesting dynamic but that area of the country being Carl County is considered a very well.
The fine as places to raise a family.
I didn't I didn't make that up I'll, just read it but and so we're pretty excited about that but we're very we're very concerned about doing it the right way and and seeing how people receive the different the different ideas that we come up with so.
We think we're in a good place we were in a good location and and we keep pushing forward to your point as quickly as we can so that we so that we try to hit the market.
Great and with regards to in the Lee County, right of way option exercise does this impact mining in any way.
Potentially.
So the the area where the.
Right of way is going is between sort of phases of mining that Vulcan has going on.
You know the accounting moved as.
Fast as they possibly could it would be.
An issue for a Vulcan just in terms of getting.
Material from the phase one part of the core to their land it doesn't take away any.
Any reserves or anything like that it could potentially be at hate a headache if the.
The accounting this before Vulcan.
It's done mining with phase one but.
That doesn't appear.
To be an issue yet and yeah. The benefit of that is that incentivize is vulcan too.
Minus asked as possible that that phase one land so it could be able to Jessica headache, but in terms of reserves it doesn't and packet.
Great and there's a you know often talks about an infrastructure plan and mining.
Mining revenues have been an all time high at your properties is there additional capacity if there were to be infrastructure deal.
Yeah.
Do you know if it's gonna happen.
[laughter] no that's yeah, that's the hard part.
But just kind of got no that volumes and price escalations it.
Prices can always go up which is the beauty prices, but no eh there there's definitely room for growth that uhm on our assets and we would obviously.
Regardless of who the president is hopefully that they recognize the urgency of the infrastructure Bill which.
Is not only necessary, but would be great for business.
Great and that's the only question Dave.
[noise]. Thank you know our next question from Kevin I met Sally from being my capital.
Hi, how are you guys can you hear me.
Yes, Sir.
Yes, Sir Kay Great just wanted to comment the website looks great when did that happen that happened that pretty recently.
[laughter] Yeah [laughter]. It was it was this is David <unk>. Thanks for pregnant at all it took us about 16 months and we launched it literally about a week or so ago.
Awesome.
Awesome well I just wanted to ask you guys follow up question the the high level narrative of the apartment business.
Is this where you guys kind of see.
The best you know place to allocate the 10 31 money in this development and credit cycle or is F. R. P.
Basically going full steam in you know, becoming really an apartment in residential multifamily company going into the future is it is it kind of marching down that direction.
I'll take take the first shot John and then you can you can correct me, if you think I'm missing something week.
We've expanded our our development platform you know from just slowly being you know warehouse and of course being an aggregate company and we.
We moved into the apartments through the development of our of our proper properties that were no not income producing down in Washington D. C. We have a company and as a group we have a tremendous amount of land development.
Experience, so we kind of let the land tell us what it what it wants to be you know the warehouses kind of got US you know to where we are and we're still very much interested in maintaining that warehouse development program I'll be at different that.
We wanna rather than hold him for a long term we look too.
You know to opportunistically exploit their value and and dispose of them sooner, which is <unk>, which is certainly a an example of what we did with our latest.
Building Dallas, how old are business park as soon as we got that off we got it and then got least some wanted it from an E. Commerce standpoint, and then we were we're happy to to to sell it.
So I I would say we are heavily involved in and development and and apartments and will probably continue to do so but not without looking out over our shoulder obviously, but more importantly location is is is critical to us.
We want to find places where population is growing but we certainly are not forgetting where our roots are which is the obviously the aggregates and also the warehouse platform.
Yeah Kevin.
Follow up on what David was saying.
As far as well.
Were you in the future of the company's going we've got.
Pretty healthy pipeline of.
A future multifamily projects that yeah.
Are already in the works so to speak whether it's faith.
Phase III face for 664, either where Vulcan is right now.
Definitely are our future has multifamily in it but I think as far as.
Deploying capital, we're somewhat agnostic when it comes to our.
Our asset base, we love industrial right now and will continue to to.
<unk> capital into <unk>.
Developing land to to start building more warehouses, if we could get you know if we had an opportunity to expand our aggregates business and we would do that yesterday, we of course loved that business in Uhm and then multifamily we're obviously a big fan of so.
You.
I don't think there's any.
One asset basically.
Want to dominate future capital I'm pulling up.
Awesome, Yeah, those those buildings look great and.
It sounds like you guys are saying opportunistic within the a real assets class and the board has been a really rational it's recent decisions. So.
Best of luck thanks, guys.
Thank you Kevin.
Yeah. My next question would be from Harper.
That means that capital.
Hey, yeah.
Yeah.
I ask everything Kevin just said I'm Super excited about the new Ed said it it it looks great.
You all think about started this expansion and internet and allocating yeah. Some of the remaining proceeds from your industrial sale Uhm can you I'll just talk about sort of markets a conviction I mean, John you just outlined pretty exciting pathway with sort of looking at.
Obviously, the address business, but also maybe.
India deeper died back into the old the old roots on the industrial development side, I mean, where your markets, where you guys are excited about right now.
Well I could take a crack at that <unk>. We we still remained pretty excited about the you know the northeast where we kind of started up here in the mid Atlantic It's still a major major population error area and from a from a warehouse perspective.
You can reach almost two thirds the population in an eight hour drive or the truck. So it's a it's a pretty it's a pretty major market Baltimore, Maryland, Washington D. C. Northern Virginia is still an awfully strong market for you know for warehousing.
And that's kind of where we we kind of grew up and then we keep our focus on that we like we like the like I said before we like the populated areas areas, where people continue to move. We went we have moved out of D. C. As I said earlier in the Greenville, South Carolina with our new strategic.
Partner would feel development they have done a tremendous amount of apartments down throughout the southeast we went to Greenville.
Kind of fell in love with that because of you know the area. It's it's business.
It's business climate, it's warm there's a lot of young people there and it just seems to be a lot of vibrancy down there in that area. So I guess the answer your question. We're looking for for two things one areas, where we believe that there is growth.
And and then two partners that we can that we can join forces with that are you know that we can do with repeatable developments.
And that's kind of hard because you know we we don't we're not passive by any stretch of the imagination, we're pretty active developers and so you want to make sure that that the that the groups that you that you joined forces with or are compatible so between location and seeking out third party platforms. It's a it's an interesting dynamic.
Thank you that's very helpful and I guess, you just real quick at all.
Particularly with the D C portfolio on the multi side are you starting to see any sort it had headwinds as far as collections are concerned or do you feel pretty good about the creditworthiness you spoke to the retail and actually sound that sounded relatively positive, but just just more on the multi front are are you seeing any any sort of just sort of headwinds with a collection.
Or do you feel pretty solid about the residents in place and and sort of their ability to continue to pay rent. You know is this been tend they kinda continues to last longer than anyone wants.
Alright, well I think go ahead go ahead John.
And you can obviously fill in the details of course, we had no expectation of.
The covid and and.
Corresponding economic slowdown when we.
We sign the tenants that we have right now, but I think it.
Speak to our our property manager. This is kind of good work. They did on on the front end that aleve other than maybe one tenant we have not had.
Any rent collection issues and that's just because of the quality of the tenant basically we had in place prior to.
The pandemic hitting.
Oh, Wow I'm, sorry, I'm I'm, just stick that on the call I thought that was just in regard in regards to the retail I didn't realize that in regard to all the multi tasking.
But yeah now we have one retail send an an one residential tenant Oh Wow, Yeah excuse me you guys that's incredible.
Almost sounded too good to believe well that's great.
[laughter] well <unk>.
Fingers crossed that it keeps going in that direction.
Awesome, what what date I wanted to make their exciting.
Thank you.
Thank you. My next question me from Cardiff Stinson from my body and company.
Okay. Good morning folks.
Curtis how are you hear me.
It is how are uhm, yeah, I'm doing I'm doing great Uhm on 1800 half Street I guess, you you got the construction loan and cute too.
And I'm curious about how banks are are kind of lending on those projects given what's going on with Covid I mean.
<unk> with the banks be looking at.
You know lending against your expected cost of construction or are they kind of trying to look at it on a stabilized value basis and Oh.
Given uncertainty about.
Maybe real estate market's there's there's more squishiness and what to stabilize value might be I mean, how are they thinking about.
They're L T V and I mean is it still sort of like 65% or <unk>.
A an expected value or can you just give me a sense of that.
It's a little lowered as if I'll I'll go ahead and <unk>.
Yeah, I'm, sorry, it's a little lower than than 65%, it's probably closer to 55 and 60.
Yeah, I think that that so the quote and they do look very heavily at our costs.
And and of course like anything they look at the people that are that are seeking they're looking at the borrowers and do they have the experience you know to make it to get these things to happen.
So they have become far more conservative than than before but then we weren't looking we have never really look to maximize the the loan to value as we've been gone into these things. We've usually stayed around 60 or 60, <unk> as much as 65%, but that was with a and E. B five but this one.
We are probably a little less than 60% loan to cost on this one.
Are you seeing are getting a sense around the D. C market that you just you implied I guess that.
The lending is getting a little tighter is that impacting any other developers I mean are people having to.
You know shelves some some development plans and kind of is there any impact of supply based on.
Yeah. It was this environment.
I think people are slow walking new developments in certain areas Curtis for sure you know it takes a lot of equity to you know to get into these things.
You know and that's the beauty of F. R. P and like we we are as you know we're we're very liquid I think we have about it had about $165 million in the bank.
At the end of September.
But <unk>.
And again, the banks are very cautious about who they learned to number one and number two the the percentages of loan to cost.
And both of those and it come a lot more critical.
A half street is that gonna be sort of are you targeting sort of the same demographic as as the Marin and dark 79, I mean is it kind of the same.
Demographic that eventually you think will.
Yeah occupying the building.
Well that whole area down there seems to be more millennial oriented, but the units that where we've designed an hour underwriting is is as conservative again, I think I like I mentioned earlier.
Half Street, like Bryant Street, or opportunity zone investments and as you know you were required to keep these assets for 10 years and it's very beneficial if we do that because of the capital gains deferral and so our underwriting of these projects is certainly.
Is different than the ones that we would that that are not opportunities.
And so we've looked a little bit more with a conservative I have Lisa you know someone mentioned why are you building a building behind a concrete plant well you know that the the answer to that is an issue one of the great things about half Street is when that building gets up and ready for least it just so happens that the timing is that there won't be another building coming online.
And when that one does but but but have street.
Yep.
18 O. One second 60 seconds to read the sale proceeds <unk> I guess are.
And the balance sheet as of the end of the third quarter right.
The 12 million or something like that that was they.
They were not on the balance that <unk>, you too, but they're in cash as of.
September.
That is correct.
Alright, let me <unk>, let me give you let me give you a <unk>.
A picture if I showed up.
With a duffel bag for the $10 million would you <unk> would you sell me the two acres that buzzard point.
No more than that for a Vulcan is.
Yeah.
No no we would not know yeah.
Yeah.
What are you what kind of number would it take to get you to get you guys out of there and turn to.
Alright, I am I'm, asking is a bit against yourself here and yeah.
Yeah.
Give up control of that property.
More than 10 million, but less than a billion something like that yeah.
We have a.
Heart in fact number.
In our head.
Thank you and what what is David do you remember what land right now and Buzzard point is going forward and kind of the.
70 to $80 for.
F a or something like that yeah property. Yeah. Curtis is go on for about 80 actually in on the waterfront, Stephen Moore, which so I'll just that there's a premium to waterfront, but.
Relative to Buzzards point in the area that we're talking about that ground has been gone for $80 plus per F. A R foot and we're thinking that the land that Vulcan sits on the somewhere between 300 and 350000 square feet of of building. So you could.
Do the math.
But that you know and that but that would be just for.
You know kind of your your vacant land.
We have a tenant in place it pays good right. So yeah that yes, yeah, we're we're not and let's see you got 4 million in the bulkhead too I guess right. It's a few years ago yeah.
Mhm.
Is it either opportunities to you know do more kind of like the the lending on the single family.
Types of projects, where you know homebuilders are looking for land.
Maybe they don't want to put up capital too you know by the their land their short of land.
And looking for land I mean are there.
Things Blue there.
Yes, part is we do that we have a couple of people that that have a tremendous amount of residential experience and.
And the reason why we wanted to get into that I guess into that business for that platform is that we.
I have a pretty good I believe that we have a pretty good eye for choosing land in and have a lot of knowledge in land development and the homebuilders have gotten away from buying raw land and entitling it and gun going through the the infrastructure development.
Because they don't want to or be in because they they they aren't allowed to.
And so we look out we look for areas, where the where there's.
Let's call it filling the whole dodona the ones that we're doing right now it's hard to believe that those properties or underdevelopment when everything around a is is got houses on them and.
And we spent a lot of time just kind of.
Looking for land in areas that that's we feel I have the need for.
Additional supply.
And and certainly we have a couple of areas up towards Delaware that we're looking at we're also down in P. G County, So we're pretty selective and more importantly, we really don't look to get into these things unless we kind of have a builder that's interested and willing to put up a little bit of a deposit up front and then maybe a lot of at the park.
As we go through so it's got a lot of things have to kind of line up for us to to actually.
You know get involved in a certain piece of ground.
And the last question. Thank you. The last question is the sale of the 87 acres at Fort Myers was that part of the <unk>.
1900, or so acres you had at Fort Myers. It did it did it involve any of the entitled lots there.
It does not involve the entitled a lot this is <unk>.
An option that the county had that in.
Uhm that went back a ways and it was actually pretty critical to.
Yeah, the future success of the lot so they they did not.
Take anything that's going to impact our ability to develop that land, but it was part of.
Yeah, the 1900 acre sure.
So if anything goes a modest positive for future development.
Yep modest an essential.
Essential to future development and the the money's good too.
Okay Yep.
Alright, thanks, very much keep up the good work. Thank you <unk> <unk>.
Can I get Curtis.
Okay, I'm showing no further questions at this time.
Alright, well. Thank you again for your supporting we obviously I appreciate your your interest in the company and.
That's out of your next door.
Talk to you next quarter.
Thank you ma'am thanks, everyone.
I'm, sorry, ladies and gentlemen that concludes today's teleconference. You may now disconnect.