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Griffin Land & Nurseries Inc. Reports Operating Results (10-K)

February 10, 2010 | About:
10qk

10qk

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Griffin Land & Nurseries Inc. (GRIF) filed Annual Report for the period ended 2009-11-28.

Griffin Land & Nurseries Inc. has a market cap of $131.8 million; its shares were traded at around $25.92 with and P/S ratio of 2.9. The dividend yield of Griffin Land & Nurseries Inc. stocks is 1.6%.

Highlight of Business Operations:

There were no property sales in fiscal 2009. Property sales revenue in fiscal 2008 included the sale of approximately 75 acres of undeveloped land in Simsbury, Connecticut, which was sold to the Town of Simsbury for open space as part of the settlement of litigation related to Meadowood, Griffin Land's proposed residential development (see Item 3 Legal Proceedings). Griffin received $0.5 million in cash at the closing, and will receive an additional $2.2 million in four installments through 2012 ($0.5 million of which was received in fiscal 2009). Also in fiscal 2008, Griffin Land recognized the remaining amounts of revenue and profit that had been deferred from the land sale to Walgreen Co. ("Walgreen") that closed in fiscal 2006. Although all of the cash proceeds from that sale were received in fiscal 2006, because that transaction was accounted for using the percentage of completion method, a portion of the revenue and profit from that sale was initially deferred and recognized in subsequent periods as the required road improvements were made. As of November 29, 2008, all of the required road improvements were completed.

As of November 28, 2009, $66.2 million was invested (net book value) in buildings owned by Griffin Land that are located in Tradeport and $4.0 million was invested (net book value) by Griffin Land in the undeveloped land there.

Griffin Center currently includes eleven office buildings (including the building built by The Hartford), a light manufacturing building and a small restaurant, five of which are owned by Griffin Land. Griffin Land currently owns two multi-story office buildings that have an aggregate of approximately 161,000 square feet, a single story office building of approximately 48,000 square feet, a 165,000 square foot light manufacturing building used principally as office, data center and call center space and the small restaurant building. As of November 28, 2009, $19.2 million was invested (net book value) in Griffin Land's buildings in Griffin Center and $1.2 million was invested by Griffin Land in the undeveloped land there. Griffin Land's two multi-story office buildings and its light manufacturing building in Griffin Center are separately mortgaged for an aggregate of approximately $12.2 million, and Griffin Land's single story office building is included as collateral under Griffin's $10 million Revolving Line of Credit.

In fiscal 2007, Griffin Land completed the sale of approximately 103 acres of undeveloped land in South Windsor, Connecticut to a food distributor for construction of a distribution facility. This transaction generated cash proceeds of approximately $2.5 million to Griffin Land for its share of the sales price. Also in fiscal 2007, Griffin Land acquired approximately 24 acres of land and an approximate 31,000 square foot warehouse facility in Bloomfield, Connecticut from General Cigar Company, Inc. ("General Cigar"). The purchase price of $2.7 million was paid in cash at closing. The purchase of this warehouse facility was also part of a Section 1031 exchange whereby a portion of the income taxes related to the gain on the land sale to The Hartford were deferred. As part of this transaction, Griffin Land entered into a ten-year lease for the entire building with General Cigar. The land acquired abuts approximately 244 acres of undeveloped land held by Griffin Land. Griffin Land is currently in the process of obtaining approvals for roadwork that would connect the acquired land to its existing parcel for future development purposes.

auction held by the Trustee of the bankruptcy estate of the sole owner of the building. The purchase price was $6.4 million plus acquisition expenses. The building is located in a major industrial area of Pennsylvania's Lehigh Valley and is under a full building lease to Olympus Corporation of the Americas ("Olympus"). Subsequent to the purchase of this building, Griffin Land completed a lease amendment with Olympus that extends the lease term through 2025. On January 29, 2010, Griffin closed on a $4.3 million nonrecourse mortgage on this building from New Alliance Bank. This is Griffin Land's first real estate acquisition outside of the Hartford, Connecticut, market.

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