PLAN OF LIQUIDATION

9 Months Ended

Sep. 30, 2011

Plan Of Liquidation [Abstract]

Plan Of Liquidation [Text Block]

2.           PLAN OF LIQUIDATION

Due to the ongoing economic downturn, given our continuing decline in revenues, expected losses from continuing operations and negative cash flows from operating activities, the Board of Directors of Presidential were concerned in 2010 that Presidential would not have sufficient liquidity and capital resources to operate in future years without sales of its assets.

As a result, the Company and its Board of Directors sought stockholder approval for the liquidation of the Company, and on January 20, 2011, stockholders approved a plan of liquidation (“Plan of Liquidation”), which provides for the sale of all of the Company’s assets over time and the distribution of the net proceeds of sale to the stockholders after satisfaction of the Company’s liabilities. Notwithstanding such stockholder approval, the Board of Directors reserves the right to consider other strategic alternatives.  There can be no assurance that the Company will be able to sell any of its assets at prices that the Board of Directors deems fair or that the Company will be able to enter into a satisfactory strategic transaction. Furthermore, the Company intends to continue to operate in a manner to permit it to qualify as a REIT unless and until it liquidates. However, no assurance can be given that it will be able to continue to operate in such a manner or to remain qualified.

In connection with the approval of the Plan of Liquidation, the Company adopted the liquidation basis of accounting as of January 1, 2011. Under the liquidation basis of accounting, the Company’s assets are stated at their estimated net realizable value and the Company’s liabilities are stated at their estimated settlement amounts.  Although the Plan of Liquidation was not approved by the stockholders until January 20, 2011, the Company is using the liquidation basis of accounting effective January 1, 2011.  Any activity between January 1, 2011 and January 20, 2011 would not be materially different under the going concern basis.

On November 8, 2011, the Company entered into a strategic transaction and terminated its Plan of Liquidation (see Note 16 – Subsequent Event). As a result, in future reporting periods the Company will resume reporting its financial statements on a going concern basis.