Real Estate, Net

9 Months Ended

Sep. 30, 2017

Real Estate [Abstract]

Real Estate, Net

Note 3 – Real Estate, Net

As of September 30, 2017 and December 31, 2016, real estate, net, includes the following (in thousands):

	September 30,		December 31,
	2017		2016
	(unaudited)		(audited)
Real estate under development		52,249	$	53,712
Buildings and building improvements		5,817		5,794
Tenant improvements		571		569
Land		2,452		2,452
		61,089		62,527
Less:  accumulated depreciation		2,327		2,143
	$	58,762	$	60,384

Real estate under development as of September 30, 2017 consists of the 77 Greenwich and Paramus, New Jersey properties while real estate under development as of December 31, 2016 consists of the 77 Greenwich, Paramus, New Jersey and Westbury, New York properties. Buildings and building improvements, tenant improvements and land at both dates consist of the West Palm Beach, Florida property.

On August 4, 2017, we closed on the sale of our property located in Westbury, New York for a gross sale price of $16.0 million. The sale resulted in a gain of $3.9 million and generated approximately $15.2 million in net proceeds to us.

Depreciation expense amounted to approximately $61,000 and $57,000 for the three months ended September 30, 2017 and September 30, 2016, respectively, and $184,000 and $145,000 for the nine months ended September 30, 2017 and September 30, 2016, respectively. The increase in depreciation expense for the three and nine months ended September 30, 2017 related to the West Palm Beach, Florida property.

Write-off of costs relating to demolished asset was approximately $3.4 million. This is related to the 77 Greenwich property’s acceleration of depreciation of the building and building improvements and demolition costs at 77 Greenwich due to the completion of demolition of the 57,000 square foot six-story commercial building.

On September 8, 2017, a wholly-owned subsidiary of ours entered into an agreement pursuant to which it acquired an option to purchase a newly built 105-unit, 12 story apartment building located at 237 11th Street, Brooklyn, New York for a purchase price of $81.0 million.  Under the agreement, we are entitled to exercise the option during the period commencing on February 1, 2018 and expiring on February 28, 2018.  We paid an initial deposit of $8.1 million, which is included in restricted cash on the condensed consolidated balance sheet, upon entering into the agreement, which is nonrefundable if we do not exercise the option.  The purchase price will be funded through acquisition financing and cash on hand. The acquisition of this property, which is subject to customary closing conditions, is expected to close in the first quarter of 2018.