Roberts Realty Investors Inc Reports Operating Results (10-K)
Roberts Realty Invs Inc has a market cap of $20.8 million; its shares were traded at around $2.02 with and P/S ratio of 9.
Highlight of Business Operations:As of June 30, 2010, the aggregate market value of the registrants common stock held by non-affiliates of the registrant was $10,714,146 based on the closing sale price of $1.56 per share as reported on the NYSE Amex Equities exchange.
As we have previously stated in our annual and quarterly reports, we intend to exit the retail shopping center business to focus exclusively on developing, constructing, and managing multifamily apartment communities. Given that objective and the approximately $625,000 in annual negative cash flow from our Grand Pavilion retail center, we have elected not to make debt service payments since July 2010 on that retail center and have allowed the loan to go into default. We are seeking to transfer the Grand Pavilion retail center to the lender as soon as possible in satisfaction of the $6,433,286 principal amount of debt secured by the property. Because the loan is nonrecourse, we would have no further obligations to the lender for this loan. This transaction would move us closer to exiting the retail business, reduce the principal amount of our debt by $6,433,286, and reduce our annual negative operating cash flow by approximately $625,000.
In approving the sale of the Addison Place retail center to the lender for the debt, our board of directors took into account the continuing poor performance of the Addison Place retail center due to the weak economic conditions and an oversupply of retail centers in its market area. The sale of the Addison Place retail center was also consistent with our objective to exit the retail business. With respect to Westside, our board evaluated the long-term nature of our investment in the property, the current real estate market conditions, and the uncertainty associated with the timing of the start of development, which could be years into the future. Equally important, our board considered our need to preserve our cash to continue with our business plan to maximize shareholder value sooner rather than later and focus on our apartment business. Together, the sale of the Addison Place retail center and Westside reduced our debt by $12,000,000 and reduced our annual negative operating cash flow by approximately $800,000.
We had total debt of $31,097,509 as of December 31, 2010 and have one loan that matures within the next 12 months: our $8,175,000 Peachtree Parkway loan that matures on July 31, 2011. If we are unable to renew this loan, we may repay all or part of it from the funds we are seeking to raise as described in our business plan below.
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