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Investment in Riverfront and Brooksville Joint Ventures | 9 Months Ended
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Jun. 30, 2015
Equity Method Investments and Joint Ventures [Abstract] |
Investment in Riverfront and Brooksville Joint Ventures | (13) Investment in Riverfront and Brooksville Joint Ventures. Riverfront. On March 30, 2012 the Company entered into a Contribution Agreement with MRP SE Waterfront Residential, LLC. (“MRP”) to form a joint venture to develop the first phase only of the four phase master development known as Riverfront on the Anacostia in Washington, D.C. The purpose of the Joint Venture is to develop, own, lease and ultimately sell an approximately 300,000 square foot residential apartment building (including approximately 18,000 square feet of retail) on approximately 2 acres of the roughly 5.82 acre site. The joint venture, Riverfront Investment Partners I, LLC (“Riverfront I”) was formed in June 2013 as contemplated. The Company contributed land with an agreed to value of $13,500,000 (cost basis of $6,165,000) and contributed cash of $4,866,000 to the Joint Venture for a 76.91% stake in the venture. MRP contributed capital of $5,553,000 to the joint venture including development costs paid prior to formation of the joint venture. The Joint Venture closed on $17,000,000 of EB5 secondary financing and a nonrecourse construction loan for $65,000,000 on August 8, 2014. Both these financing sources are non-recourse to FRP. Construction commenced in October 2014. At this point, the Company anticipates lease up to occur in the second half of calendar 2016 and all of 2017. The Company’s equity interest in the joint venture is accounted for under the equity method of accounting as MRP acts as the administrative agent of the joint venture and oversees and controls the day to day operations of the project. Other income for the first nine months of fiscal 2015 includes a loss of $226,000 representing the Company’s portion of the loss of this joint venture due primarily to expenses incurred in the joint venture with respect to the environmental remediation. Brooksville. In 2006, the Company entered into a Joint Venture Agreement with Florida Rock Industries, Inc. (now owned by Vulcan Materials Company) to jointly own and develop approximately 4,300 acres of land near Brooksville, Florida. Under the terms of the joint venture, FRP contributed its fee interest in approximately 3,443 acres formerly leased to Vulcan under a long-term mining lease which had a net book value of $2,548,000. Vulcan is entitled to mine a portion of the property until 2022 and pay royalties to the Company. FRP also contributed $3,018,000 for one-half of the acquisition costs of a 288-acre contiguous parcel. Vulcan contributed 553 acres that it owned as well as its leasehold interest in the 3,443 acres that it leased from FRP and $3,018,000 for one-half of the acquisition costs of the 288-acre contiguous parcel. The joint venture is jointly controlled by Vulcan and FRP, and they each have a mandatory obligation to fund additional capital contributions of up to $2,380,000. Capital contributions of $2,347,000 have been made by each party as of June 30, 2015. Distributions will be made on a 50-50 basis except for royalties and depletion specifically allocated to the Company. Other income for the first nine months of fiscal 2015 includes a loss of $29,000 representing the Company’s portion of the loss of this joint venture. In April 2011, the Florida Department of Community Affairs issued its Final Order approving the development of the Project, and zoning for the Project was obtained from Hernando County in August 2012. We will continue to monitor the residential market in Hernando County and pursue opportunities to partner with a master community developer or major homebuilder to commence construction when the market dictates. Real estate revenues included $237,000 of royalties from the mining activities on this property in the nine months ended June 30, 2015 and $156,000 in nine months ended June 30, 2014. Allocated depletion expense of $6,000 was included in real estate cost of operations for the nine months ended June 30, 2015. Investments in Joint Ventures (in thousands):
|  |  |  |  |  |  |  |  |  |  |  |  |  | The |
|  |  |  |  |  |  |  |  |  |  |  |  |  | Company's |
|  |  |  |  |  |  |  | Total Assets |  |  | Net Loss |  |  | Share of Net |
|  |  |  |  | Total |  |  | of the |  |  | of the |  |  | Loss of the |
|  | Ownership |  |  | Investment |  |  | Partnership |  |  | Partnership |  |  | Partnership |
|  |  |  |  |  |  |  | (Unaudited) |  |  | (Unaudited) |  |  |  |
As of June 30, 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Riverfront Holdings I, LLC |  | 76.91 | % |  | $ 11,239 |  |  | $ 35,594 |  |  | $ (273 | ) |  | $ (226 | )
Brooksville Quarry, LLC |  | 50.00 | % |  | 7,506 |  |  | 14,338 |  |  | (58 | ) |  | (29 | )
Total |  |  |  |  | $ 18,745 |  |  | $ 49,932 |  |  | $ (331 | ) |  | $ (255 | )
As of September 30, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Riverfront Holdings I, LLC |  | 76.91 | % |  | $ 11,031 |  |  | $ 33,834 |  |  | $ (89 | ) |  | $ (89 | )
Brooksville Quarry, LLC |  | 50.00 | % |  | 7,506 |  |  | 14,353 |  |  | (78 | ) |  | (39 | )
Total |  |  |  |  | $ 18,537 |  |  | $ 48,187 |  |  | $ (167 | ) |  | $ (128 | )
Summarized Unaudited Financial Information for the Investments in Joint Ventures (in thousands):
|  | As of |
|  |  | 6/30/2015 |  |  |  | 9/30/2014 |
Cash |  | $ | 56 |  |  | $ | 208 |
Cash held in escrow |  |  | 7,100 |  |  |  | 18,822 |
Amortizable Debt Costs |  |  | 2,069 |  |  |  | 2,069 |
Investments in real estate, net. |  |  | 40,707 |  |  |  | 27,088 |
Total Assets |  | $ | 49,932 |  |  | $ | 48,187 |
Other Liabilities |  | $ | 1,892 |  |  | $ | 313 |
Long-term Debt |  |  | 17,000 |  |  |  | 17,000 |
Capital – FRP |  |  | 18,745 |  |  |  | 18,537 |
Capital - Third Parties |  |  | 12,295 |  |  |  | 12,337 |
Total Liabilities and Capital |  | $ | 49,932 |  |  | $ | 48,187 |

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6382943&loc=d3e33918-111571 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=35687916&loc=d3e32847-111569 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.12) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=35687916&loc=d3e32787-111569 + Details
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