10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________

FORM 10-K

_________________

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 2014.

or

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-36769

_____________________

FRP HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

_____________________

FLORIDA	47-2449198
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
200 W. Forsyth St., 7th Floor, Jacksonville, Florida	32202
(Address of principal executive offices)	(Zip Code)

(904) 396-5733

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock $.10 par value	NASDAQ

Securities registered pursuant to Section 12(g) of the Act: None

_________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  [_]    No  [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  [_]    No  [X]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  [X]    No  [_]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  [X]    No  [_]

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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [_]	Accelerated  filer [X]
Non-accelerated filer [_]	Smaller reporting company [_]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes  [_]    No  [X]

The number of shares of the registrant’s stock outstanding as of November 28, 2014 was 9,713,395. The aggregate market value of the shares of Common Stock held by non-affiliates of the registrant as of March 31, 2014, the last day of business of our most recently completed second fiscal quarter, was $165,387,088. Solely for purposes of this calculation, the registrant has assumed that all directors, officers and ten percent (10%) shareholders of the Company are affiliates of the registrant.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the FRP Holdings, Inc. 2014 Annual Report to Shareholders are incorporated by reference in Parts I and II.

Portions of the FRP Holdings, Inc. Proxy Statement which will be filed with the Securities and Exchange Commission not later than December 31, 2014 are incorporated by reference in Part III.

Explanatory Note

As previously announced in a Form 8-K filed on December 3, 2014, Patriot Transportation Holding, Inc., reorganized its corporate structure through a holding company merger pursuant to which it became a wholly-owned subsidiary of FRP Holdings, Inc. FRP Holdings, Inc., referred to herein as the "Company" or "FRP", is the successor issuer to Patriot Transportation Holding, Inc.

Preliminary Note Regarding Forward-Looking Statements.

Certain matters discussed in this report contain forward-looking statements, including without limitation relating to the Company's plans, strategies, objectives, expectations, intentions, capital expenditures, future liquidity, plans and timetables for completion of pending development projects and the timetable for the completion of the proposed spin-off of the transportation group. The words or phrases “anticipate,” “estimate,” ”believe,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target” and similar expressions identify forward-looking statements. The following factors and others discussed in the Company’s periodic reports and filings with the Securities and Exchange Commission are among the principal factors that could cause actual results to differ materially from the forward-looking statements: uncertainties as to whether the Company will be able to complete, and recognize the benefits of, the proposed spin-off of the transportation

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group; uncertainties as to whether the Company can complete, and the timetable for completion of pending or proposed development projects; freight demand for petroleum products including recessionary and terrorist impacts on travel in the Company’s markets; levels of construction activity in the markets served by our mining properties; fuel costs and the Company’s ability to recover fuel surcharges; accident severity and frequency; risk insurance markets; driver availability and cost; the impact of future regulations regarding the transportation industry; availability and terms of financing; competition; interest rates, inflation and general economic conditions; demand for flexible warehouse/office facilities in the Baltimore-Washington-Northern Virginia area; and ability to obtain zoning and entitlements necessary for property development. However, this list is not a complete statement of all potential risks or uncertainties.

These forward-looking statements are made as of the date hereof based on management’s current expectations, and the Company does not undertake an obligation to update such statements, whether as a result of new information, future events or otherwise. Additional information regarding these and other risk factors may be found in the Company’s other filings made from time to time with the Securities and Exchange Commission.

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PART I

Item 1. BUSINESS.

Earlier this year, we announced plans to separate into two independent publicly-traded companies:

· Our real estate businesses will operate under our new corporate name FRP Holdings, Inc. (“FRP”); and

· Our transportation business, which after the separation will operate under the name Patriot Transportation Holding, Inc.("New Patriot").

In order to facilitate the separation, we recently completed an internal reorganization pursuant to which Existing Patriot became a subsidiary of FRP. FRP was incorporated in 2014 and currently owns our real estate and transportation businesses.

Our transportation business is a regional tank truck carrier specializing in hauling petroleum products, chemicals and dry bulk commodities.

The Company’s real estate activities are conducted through two wholly owned subsidiaries: Florida Rock Properties, Inc. (“Properties”) and FRP Development Corp. (“Development”).

The Company’s real estate operations consist of two reportable segments. The mining royalty land segment owns real estate including construction aggregate royalty sites and parcels held for investment. The developed property rentals segment acquires, constructs, and leases office/warehouse buildings primarily in the Baltimore/Northern Virginia/Washington area and holds real estate for future development or related to its developments. Substantially all of the real estate operations are conducted within the Southeastern and Mid-Atlantic United States. Real estate revenues in fiscal 2014 were divided approximately 83% from rentals on developed properties and 17% from mining royalties.

Transportation. Our transportation business is a regional tank carrier primarily specializing in hauling petroleum products, chemicals and dry bulk commodities. As of September 30, 2014, we employed 683 revenue producing drivers and operated 21 terminals in Florida, Georgia, Alabama, South Carolina, North Carolina, and Tennessee.

During fiscal 2014, Tank Lines operated from terminals in Jacksonville, Orlando, Panama City, Pensacola, Port Everglades, Tampa and White Springs, Florida; Albany, Atlanta, Augusta, Bainbridge, Columbus, Macon and Savannah, Georgia; Chattanooga, Knoxville and Nashville, Tennessee; Birmingham and Montgomery, Alabama; Wilmington, North Carolina; and Spartanburg, South Carolina.

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Tank Lines has from two to six major tank truck competitors in each of its markets. Price, service, and location are the major factors which affect competition in the transportation segment within a given market.

During fiscal 2014, the transportation segment’s ten largest customers accounted for approximately 54.7% of the transportation segment’s revenue. One of these customers, Murphy Oil Corporation, accounted for 20.9% of the transportation segment’s revenue. The loss of any one of these customers could have a material adverse effect on the Company’s revenues and income.

During fiscal 2014, the transportation segment purchased 77 new tractors and 9 trailers, plus 11 tractors and 67 trailers acquired from Pipeline Transportation, Inc. in November 2013. Our fiscal 2015 capital budget includes 75 new tractors and 27 new trailers including binding commitments to purchase 20 tractors and 5 trailers at September 30, 2014. We are replacing a larger than average number of tractors purchased prior to 2007 engine changes required by the EPA. We anticipate this more modern fleet will result in reduced maintenance expenses, improved operating efficiencies and enhanced driver recruitment and retention. At September 30, 2014 the transportation segment operated a fleet of 486 tractors and 588 tank trailers plus 7 additional trucks that were being prepared for sale. The Company owns all of the tank trailers and owns all of the tractors except for 47 leased tractors that were acquired from Pipeline Transportation and 3 tractors owned by owner-operators.

The Company’s transportation segment acquired certain assets of Pipeline Transportation, Inc. on November 7, 2013. Pipeline’s operations have been conducted in the Florida and Alabama markets also served by Florida Rock and Tank Lines, Inc. For the twelve month period ending June 30, 2013, Pipeline had gross revenues of just over $16,500,000.

Mining Royalty Land. The mining royalty land segment owns and seeks to acquire land with construction aggregates deposits, a substantial portion of which is leased to Vulcan Materials Company under long-term mining royalty agreements, whereby the Company is paid a percentage of the revenues generated or annual minimums. The segment also owns mining related land held for future appreciation or development.

Developed Property Rentals. The developed property rentals segment acquires, constructs, leases and manages land and commercial buildings in the Baltimore/Northern Virginia/Washington and Jacksonville, Florida areas.

A significant part of our strategy has been to develop high quality, flexible warehouse/office space. Average occupancy for the fiscal year for buildings in service more than 12 months was 89.4%. At September 30, 2014, 89.6% of the total warehouse/office portfolio of approximately 3.5 million square feet was occupied.

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Price, location, rental space availability, flexibility of design, and property management services are the major factors that affect competition in the flexible warehouse/office rental market. The Company experiences considerable competition in all of its markets.

Tenants of flexible warehouse/office properties are not concentrated in any one particular industry.

Segment Information. The Company operates in three reportable segments: transportation, mining royalty land and developed property rentals. Industry segment information is presented in Note 10 to the consolidated financial statements included in the accompanying 2014 Annual Report to Shareholders and is incorporated herein by reference.

Environmental Matters. Environmental regulations have increased the costs of our transportation and real estate businesses. Revised EPA regulations decrease the amount of permitted air emissions that can be released by tractor engines and affect tractors produced after the effective date of the regulations.  Compliance with these regulations has increased the cost of our new tractors, increased repair expense, and lowered fuel mileage.  This will increase our capital expenditures and our operating expenses. The Company has incurred costs to investigate and remediate environmental contamination on its real estate. The Company's mining leases contain a provision making the lessee responsible for reclamation of mining sites at least to the extent required by law.

Seasonality. The Company’s business is subject to limited seasonality due to the cyclical nature of our customers’ businesses, with revenues generally declining slightly during winter months.

Employees. The Company employed 932 people in its transportation segment, 15 people in its real estate group and 10 people in its corporate offices at September 30, 2014.

Reorganization and the Spin-off.

General

On December 3, 2014, our board of directors of Patriot Transportation Holding, Inc. ("Existing Patriot") approved the sepataion of our real estate and transportation businesses into two independent publicly traded companies.

In order to facilitate the separation, we recently completed an internal reorganization pursuant to which Existing Patriot became a wholly owned subsidiary of FRP. In this transaction all of the shares of Existing Patriot common stock were converted into shares of FRP.

In the separation, FRP will distribute all of the outstanding

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common stock of the corporation owning the transportation business("New Patriot")to holders of FRP common stock as of the record date.

As a result of the distribution, holders of FRP common stock will be entitled to receive, for each share of FRP common stock that they hold on the record date, one-third of one share of New Patriot common stock. We anticipate that the distribution will be completed in early 2015.

Following the distribution, New Patriot will operate as a regional tank lines transportation business focused in hauling petroleum, chemicals and dry bulk commodities. See “Our Business.”

Reasons for the Separation

Our board of directors believes separating its transportation business from its real estate business is in the best interests of FRP and our shareholders and has concluded the separation will provide each business with a number of opportunities and benefits, including the following:

• Strategic and Management Focus. Permit the management team of each company to focus on its own strategic and operational priorities without diverting human and financial resources from the other businesses.

• Resource Allocation and Capital Deployment. Allow each company to allocate resources and deploy capital in a manner consistent with its own strategic priorities. Both businesses will have direct access to the debt and equity capital markets to fund their respective growth strategies.

• Create Opportunities for Growth.  The spin-off may allow us to take greater advantage of and have greater flexibility in raising capital and responding to strategic opportunities for growth, because we will have the ability to offer our stock as consideration in connection with potential future acquisitions or other growth opportunities. We believe that potential targets may be more attracted to a stock-based acquisition by an independent acquiror operating exclusively in the transportation industry than by a consolidated entity operating in different industries.

• Better Align Management Incentives with the Business’ Performance.  After the spin-off, we will be able to better align management incentives with the performance of our business. We will provide equity-based compensation to management, which will reflect the market price of our common stock and performance of our business. The resulting focused equity incentives will be used to better motivate the members of our management team.

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• Provide Investors with a More Focused Investment Option.   As an independent public company focused solely on the transportation industry after the spin-off, it will be easier for investors to analyze and compare our company to other companies within the transportation industry. Accordingly, we may generate additional investor interest by providing investors with the opportunity to directly invest in our business and may appeal to more investors with different goals, interests and concerns.

There can be no assurance that following the separation, any of the benefits described above or otherwise will be realized to the extent anticipated or at all.

Our board of directors also considered a number of potentially negative factors in evaluating the separation, including the following:

• Increased public company costs. After the separation, FRP and New Patriot will operate as separate public companies and each company will incur incremental public company costs that previously were shared by both businesses.

• Disruptions to the business as a result of the separation. The actions required to separate the transportation business from the real estate businesses will take significant management time and attention and could disrupt our operations.

• One-time costs of the separation. New Patriot and FRP will incur significant one-time costs in connection with the transition to being two stand-alone publicly traded companies. New Patriot and FRP will lose certain synergies associated with being part of a larger organization that cannot be quantified, as well as incremental public company costs estimated to be approximately $200,000 to $350,000 per year.

• FRP and New Patriot may not realize anticipated benefits of the separation. FRP and New Patriot may not achieve the anticipated benefits of the separation for a variety of reasons, including, among others: (a) the separation will require significant amounts of management’s time and effort, which may divert management’s attention from operating FRP's and New Patriot’s businesses; (b) following the separation, FRP and New Patriot may be more susceptible to market fluctuations and other adverse events than if it were still a part of Existing Patriot; and (c) following the separation, FRP's and New Patriot’s businesses will be less diversified than prior to the separation.

Our board of directors concluded that the potential benefits of the separation outweighed these negative factors.

Company Website. The Company’s website may be accessed at www.patriottrans.com. All of our filings with the Securities and Exchange Commission can be accessed through our website promptly after filing. This includes annual reports on Form 10-K, proxy

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statements, quarterly reports on Form 10-Q, current reports filed or furnished on Form 8-K and all related amendments.

EXECUTIVE OFFICERS OF THE REGISTRANT

Name	Age	Office	Position Since
John D. Baker II	66	Executive Chairman	Oct. 1, 2010
Thompson S. Baker II	55	President & Chief	Oct. 1, 2010
		Executive Officer
David H.	63	Vice President of the	Feb. 28, 1994
deVilliers, Jr.		Company and President
		of the Company's Real
		Estate Group
John D. Milton, Jr.	69	Exec. Vice President,	Jun. 16, 2008
		Treasurer, Secretary
		and Chief Financial
		Officer
John D. Klopfenstein	51	Controller and Chief	Feb. 16, 2005
		Accounting Officer
Robert E. Sandlin	53	Vice President of the	Mar. 1, 2003
		Company and President
		of Florida Rock &
		Tank Lines, Inc.

All of the above officers have been employed in their respective positions for the past five years except as follows: John D. Baker II served as President and Chief Executive Officer of the Company from February 2008 to October 2010 and as President and Chief Executive Officer of Florida Rock Industries, Inc. from 1996 to November 2007; and Thompson S. Baker II served as the President of the Florida Rock Division of Vulcan Materials Company ("Vulcan") from November 2007 to September 2010 and as President of the Aggregates Group of Florida Rock Industries, Inc. from August 1991 to November 2007.

John D. Baker II, who is the brother of Chairman Emeritus Edward L. Baker, and Thompson S. Baker II, who is the son of Edward L. Baker, are directors of the Company.

Robert E. Sandlin plans to resign as an officer of FRP immediately prior to the proposed spin-off.

All executive officers of the Company are elected by the Board of Directors annually and serve until their resignation or removal.

Item 1A. RISK FACTORS.

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Our future results may be affected by a number of factors over which we have little or no control. The following issues, uncertainties, and risks, among others, should be considered in evaluating our business and outlook. Also, note that additional risks not currently identified or known to us could also negatively impact our business or financial results.

Risks Relating to the Proposed Separation of the Transportation Group

The Company's planned spin-off of the transportation group is subject to a number of risks, including the following:

The combined post-separation value of FRP and New Patriot shares may not equal or exceed the pre-separation value of Existing Patriot common shares.

As a result of the distribution, FRP expects the trading price of FRP common shares immediately following the distribution to be lower than the “regular-way” trading price of such shares immediately prior to the distribution because the trading price will no longer reflect the value of the transportation business held by New Patriot. There can be no assurance that the aggregate market value of the FRP common stock and the New Patriot common stock following the separation will be equal to or higher than the market value of FRP common shares if the separation did not occur.

There could be significant liability to FRP if the distribution is determined to be a taxable transaction.

The separation and distribution is conditioned on the receipt by FRP of an opinion from outside tax counsel to the effect that, among other things, (i) the holding company merger (together with the conversion of the shares of Existing Patriot common stock into shares of FRP common stock pursuant to the holding company merger) will qualify as a “reorganization” within the meaning of Section 368(a)(2)(E) of the Code and will not be integrated with the rest of the separation and distribution, and (ii) the separation and distribution will qualify as a “reorganization” for U.S. federal income tax purposes under Sections 355 and 368(a)(1)(D) of the Code. FRP will not obtain a private letter ruling from the IRS in connection with the holding company merger and the separation and distribution. The opinion of tax counsel is not binding on the IRS.  Moreover, the opinion will rely on facts, assumptions, representations and undertakings from Existing Patriot, FRP and New Patriot regarding the past and future conduct of the companies’ respective businesses and other matters. Notwithstanding receipt of the opinion of tax counsel, the IRS could determine on audit that the holding company merger and/or separation and distribution is taxable if it determines that any of these facts, assumptions, representations or undertakings are not correct or have been violated or if it disagrees with the conclusions in the opinion, or for other reasons, including as a result of significant changes in

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the share ownership of FRP or New Patriot after the separation. If the holding company merger and/or separation and distribution is determined to be taxable for U.S. federal income tax purposes, FRP and its shareholders that are subject to U.S. federal income tax could incur significant U.S. federal income tax liabilities and New Patriot could incur significant liabilities related thereto.

FRP may not realize the potential benefits from the separation, and the separation may adversely affect our business.

FRP may not be able to achieve the full strategic and financial benefits expected to result from the separation, or such benefits may be delayed or not occur at all. The separation and distribution is expected to provide the following benefits, among others:

• a distinct investment identity allowing investors to evaluate the merits, performance, and future prospects of FRP separately from New Patriot;

• more efficient allocation of capital for both FRP and New Patriot;

• facilitating incentive compensation arrangements for employees more directly tied to the performance of the relevant company’s business.

FRP may not achieve these and other anticipated benefits for a variety of reasons, including, among others: (a) the separation will require significant amounts of management’s time and effort, which may divert management’s attention (b) following the separation, FRP's business will be less diversified than Existing Patriot’s business prior to the separation; and (c) the other actions required to separate FRP’s and New Patriot’s respective businesses could disrupt FRP's operations. If FRP fails to achieve some or all of the benefits expected to result from the separation, or if such benefits are delayed, the business, financial condition, and results of operations of New Patriot could be adversely affected.

The separation of the transportation business from the real estate business may increase the overall cost of debt funding and decrease the overall debt capacity available to FRP.

FRP previously had access to the credit facilities made available to the combined company. As a separate business, FRP will have fewer assets and will generate less cash flow, and this may impact the terms under which FRP can borrow from lenders. The separation of the transportation business from the real estate business may increase the overall cost of debt funding and decrease the overall debt capacity available to FRP.

The separation of the transportation business from the real estate businesses will require significant management time and attention

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and could disrupt Existing Patriot’s operations.

The planning and implementation of the separation of the transportation business from the real estate businesses is a substantial undertaking that has required and will require substantial dedication of management resources. The management time and attention required to implement the separation may disrupt our ongoing business activities and may result in employee distraction.

Initially, FRP will share three executives with New Patriot so those executives will not devote their full time and attention to either business.

Under the terms of the Transition Services Agreement between FRP and New Patriot, New Patriot will provide the services of three of its executive officers to FRP. Thompson S. Baker II, Chief Executive Officer, John D. Milton, Jr., Chief Financial Officer, and John D. Klopfenstein, Controller and Chief Accounting Officer, will serve in the same capacities with FRP under the Transition Services Agreement. We anticipate that these executives will spend approximately 50% of their time working with FRP during the term of the Transition Services Agreement, and FRP has agreed to reimburse us for 50% of the total costs associated with these executives (inclusive of overhead). Each company's business could be adversely impacted by lack of the full-time focus of these executives during the term of the Transition Services Agreement. In addition, these executives may face actual or apparent conflicts of interest if there are issues or disputes under the agreements between New Patriot and FRP.

There will be potential conflicts of interest with FRP after the separation.

New Patriot has common management with FRP, which may lead to conflicting interests. At the time of the spin off, three of our executive officers will serve as executive officers of both New Patriot and FRP. New Patriot's Chief Executive Officer, Thompson S. Baker II, will serve as a director of both companies. New Patriot's executive officers and members of its board of directors will have fiduciary duties to our shareholders. Likewise, any such persons who serve in similar capacities at FRP will have fiduciary duties to FRP’s shareholders. Therefore, such persons may have conflicts of interest or the appearance of conflicts of interest with respect to matters involving or affecting each company. For example, there will be the potential for a conflict of interest if FRP and New Patriot look at acquisitions and other corporate opportunities that may be suitable for each company. Moreover, after the separation, most of New Patriot's directors and officers will continue to own FRP stock and options to purchase FRP stock, which they acquired prior to the spin off. These ownership interests could create, or appear to create, potential conflicts of interest when these individuals are faced with decisions that could have different implications for New Patriot and FRP. From time to

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time, FRP may enter into transactions with New Patriot or its subsidiaries or other affiliates. Although the terms of any such transactions will be established based upon negotiations between employees of the companies involved, there can be no assurance that the terms of any such transactions will be as favorable to us or our subsidiaries or affiliates as would be the case where the parties are completely at arms' length.

Risks Relating to the Transportation Business

The transportation business is subject to general economic and other factors that are largely out of our control and could affect our operations, profitability and cash flow.

The transportation business is dependent on various economic factors over which we have little control, that include:

• the availability of qualified drivers;

• access to the credit and capital markets;

• rising healthcare costs;

• increases in fuel prices, taxes and tolls;

• increases in costs of equipment;

• interest rate fluctuations;

• excess capacity in the trucking industry;

• changes in laws or regulations or changes in license and regulatory fees;

• potential disruptions at U.S. ports of entry;

• downturns in customers’ business cycles; and

• insurance prices.

As a result, we may experience periods of overcapacity, declining prices, lower profit margins and less availability of cash in the future. Our revenues and operating income could be materially adversely affected if it is unable to pass through to its customers the full amount of increased transportation costs.

We would be adversely affected by a decline in demand for hauling petroleum products in our markets.

We derive approximately 82% of our revenues from the hauling of petroleum products, including gasoline, diesel fuel and ethanol. The demand for these services is determined by motor fuel consumption in our markets, which is affected by general economic

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conditions, employment levels, consumer confidence, spending patterns and gasoline prices. Demand for our petroleum hauling services is also impacted by vehicle fuel efficiency, alternative fuel vehicles and government regulation relating to ethanol. The Energy Information Administration of the U.S. Department of Energy projects that U.S. motor gasoline consumption will decline at an average rate of 1.1% per year between 2012 and 2040 as improvements in fuel efficiency are expected to outpace increases in miles driven.

Advanced technology, improved fuel efficiency and increased use of “green” automobiles (e.g., those automobiles that do not use gasoline or that are powered by hybrid engines) would reduce demand for gasoline. Developments regarding climate change and the effects of greenhouse gas emissions on climate change may lead to increased use of “green” automobiles. Consequently, attitudes toward gasoline and its relationship to the environment may significantly affect our sales and ability to market our products. Reduced consumer demand for gasoline could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We may be adversely affected by fluctuations in the price and availability of fuel.

We require large amounts of diesel fuel to operate our tractors. In 2012, 2013 and 2014, fuel (including fuel taxes) represented approximately 23.4%, 22.9%, and 22.7%, respectively, of our total revenue. The market price for fuel can be extremely volatile and can be affected by a number of economic and political factors. In addition, changes in federal or state regulations can impact the price of fuel, as well as increase the amount we pay in fuel taxes. We incorporate a fuel surcharge clause in substantially all customer contracts to pass most additional fuel costs above a specified level on to our customers. However, we may not be able to do so in the future.

The amount of the fuel surcharge each month is typically based on the average price of fuel for the prior month; accordingly, our recovery of fuel costs in excess of the levels specified in our contracts lags the actual increase in fuel prices, and we may never be fully reimbursed for increases in fuel prices above the levels specified in our contracts. We currently do not hedge our fuel purchases to protect against fluctuations in fuel prices that are not covered by fuel surcharges, and therefore are at risk to the extent that changes in the market price of fuel are not covered by the fuel surcharge provisions of our customer contracts. In addition, our customers may negotiate rates or contracts that minimize or eliminate our ability to continue passing on fuel price increases to our customers. If fuel prices increase and we are unable to pass the increased cost to our customers, the additional expense could have a material adverse effect on our business, results of operations and financial condition.

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Our operations may also be adversely affected by any limit on the availability of fuel. Disruptions in the political climate in key oil producing regions in the world, particularly in the event of wars or other armed conflicts, could severely limit the availability of fuel in the United States. In the event our customers face significant difficulty in obtaining fuel, our business, results of operations and financial condition would be materially adversely affected.

Our business may be adversely affected by seasonal factors and harsh weather conditions.

Our business is subject to seasonal trends common in the refined petroleum products delivery industry. We typically encounter increased demand for fuels delivery services in Florida during the spring months. Further, operating costs and earnings are generally adversely affected by inclement weather conditions. These factors generally result in lower operating results during the first and fourth quarters of the year and cause our operating results to fluctuate from quarter to quarter. Our operating expenses also have been somewhat higher in the winter months, primarily due to decreased fuel efficiency, increased utility costs and increased maintenance costs for tractors and trailers in colder months. An occurrence of unusually harsh or long-lasting inclement weather could have an adverse effect on our operations and profitability.

We operate in a highly competitive industry, and competitive pressures may adversely affect our operations and profitability.

The tank lines transportation business is extremely competitive and fragmented. We compete with many other carriers and varying sizes as well as our customers’ private fleets. Numerous competitive factors could impair our ability to maintain our current level of revenues and profitability and adversely affect our financial condition. These factors include the following:

• we compete with many other fuels delivery service providers, particularly smaller regional competitors, some of which may have more equipment in, or stronger ties to, the geographic regions in which they operate or other competitive advantages;

• some of our competitors periodically reduce their prices to gain business, which may limit our ability to maintain or increase prices, implement new pricing strategies or maintain significant growth in our business;

• many customers periodically accept bids from multiple carriers, and this process may depress prices or result in the loss of some business to competitors;

• many customers are looking to reduce the number of carriers they use, and in some instances we may not be

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selected to provide services;

• consolidation in the fuels delivery industry could create other large carriers with greater financial resources than we have and other competitive advantages relating to their size;

• the development of alternative power sources for cars and trucks could reduce demand for gasoline; and

• advances in technology require increased investments to maintain competitiveness, and we may not have the financial resources to invest in technology improvements or our customers may not be willing to accept higher prices to cover the cost of these investments.

If we are unable to address these competitive pressures, our operations and profitability may be adversely affected.

The loss or bankruptcy of one or more significant customers may adversely affect our business.

We are dependent upon a limited number of large customers. Our ten largest customers accounted for approximately 54.7% of our total revenues during the year ended September 30, 2014. In particular, our largest customer, Murphy USA, accounted for 20.9% of our total revenues during fiscal 2014. The loss of one or more of our major customers, or a material reduction in services performed for such customers, would have a material adverse effect on our results of operations. In addition, if one or more of our customers were to seek protection under the bankruptcy laws, we might not receive payment for services rendered and, under certain circumstances, might have to return payments made by these customers during the 90 days prior to the bankruptcy filing. If we were to lose one or more of our key customers, we might not be able to capture additional volume from other customers to offset the fixed costs historically covered by the lost revenue.

Difficulty in attracting and retaining drivers could negatively affect our operations and limit our growth.

There is substantial competition for qualified personnel, particularly drivers, in the trucking industry. Regulatory requirements, including electronic logging, and an improvement in the economy, could reduce the number of eligible drivers. We operate in many geographic areas where there is a shortage of drivers. Any shortage of drivers could result in temporary under-utilization of our equipment, difficulty in meeting our customers' demands and increased compensation levels, each of which could have a material adverse effect on our business, results of operations and financial condition. A loss of qualified drivers could lead to an increased frequency in the number of accidents, potential claims exposure and, indirectly, insurance costs.

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Difficulty in attracting qualified drivers could also require us to limit our growth. Our strategy is to grow in part by expanding existing customer relationships into new markets. However, we may have difficulty finding qualified drivers quickly when presented with new customer opportunities, which could result in our inability to accept or service this business or could require us to increase the wages we pay in order to attract drivers. If we are unable to hire qualified drivers to service business opportunities in new markets, we may have to temporarily send drivers from existing terminals to those new markets, causing us to incur significant costs relating to out-of-town driver pay and expenses. In making acquisitions and converting private fleets, some of the drivers in those fleets may not meet our standards, which would require us to find qualified drivers to replace them. If we are unable to find and retain such qualified drivers on terms acceptable to us, we may be forced to forego opportunities to expand or maintain our business.

If our relationship with our employees were to deteriorate, we may be faced with unionization efforts, labor shortages, disruptions or stoppages, which could adversely affect our business and reduce our operating margins and income.

Our operations rely heavily on our employees, and any labor shortage, disruption or stoppage caused by poor relations with our employees could reduce our operating margins and income. None of our employees are subject to collective bargaining agreements, although unions have traditionally been active in the U.S. trucking industry. Our workforce has been subject to union organization efforts from time to time, and we could be subject to future unionization efforts as our operations expand. Unionization of our workforce could result in higher compensation and working condition demands that could increase our operating costs or constrain our operating flexibility. In addition, we are from time to time subject to wage and hour claims relating to overtime pay where our drivers work more than eight hours in a day but less than 40 hours in a week. We believe we are exempt from overtime pay rules under regulations of the Department of Transportation ("DOT"). However, our operating costs would increase if this exemption were rescinded or if a court determined that we were not exempt from these overtime pay rules.

If we lose key members of our senior management, our business may be adversely affected.

Our ability to implement our business strategy successfully and to operate profitably depends in large part on the continued employment of our senior management team, led by Tom Baker, our president and Chief Executive Officer, John Milton, our Chief Financial Officer and Rob Sandlin, President of Florida Rock & Tank Lines, Inc. If Mr. Baker, Mr. Milton, Mr. Sandlin or the other members of senior management become unable or unwilling to continue

17

in their present positions, our business or financial results could be adversely affected.

If we fail to develop, integrate or upgrade our information technology systems, we may lose customers or incur costs beyond our expectations.

We rely heavily on information technology and communications systems to operate our business and manage our network in an efficient manner. We have equipped our tractors with various mobile communications systems and electronic logging devices that enable us to monitor our tractors and communicate with our drivers in the field and enable customers to track the location and monitor the progress of their cargo through the Internet. Despite redundancies and security measures, our information technology and communications systems remain susceptible to outages, computer viruses, break-ins, human error, data leakage and other disruptions and imperfections. Any of these could impair the efficiency of our operations, inhibit our customer service or reduce customer access to information. In addition, there could be a loss of confidential information, corruption of data, or damage to our reputation. Demand for our services or the profitability of operations could in turn be affected, which could have a negative impact on our results of operations or cash flows.

Increasingly, we compete for customers based upon the flexibility and sophistication of our technologies supporting our services. The failure of hardware or software that supports our information technology systems, the loss of data contained in the systems, or the inability of our customers to access or interact with our website, could significantly disrupt our operations and cause us to lose customers. If our information technology systems are unable to handle additional volume for our operations as our business and scope of service grow, our service levels and operating efficiency will decline. In addition, we expect customers to continue to demand more sophisticated fully-integrated information systems. If we fail to hire and retain qualified personnel to implement and maintain our information technology systems or if we fail to upgrade or replace these systems to handle increased volumes, meet the demands of our customers and protect against disruptions of our operations, we may lose customers, which could seriously harm our business.

To compete effectively, we must anticipate and adapt to technology changes. We may choose new technologies that later prove to be inadequate, or may be forced to implement new technologies, at substantial cost, to remain competitive. In addition, competitors may implement new technologies before we do, allowing such competitors to provide lower priced or enhanced services and superior quality compared to those we provide. This development could have a material adverse impact on our ability to compete.

We are self-insured and/or have deductible exposure to certain claims and are subject to the fluctuations of the insurance

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marketplace, all of which could affect our profitability.

The primary accident risks associated with our business are:

• motor-vehicle related bodily injury and property damage;

• workers’ compensation claims;

• environmental pollution liability claims;

• cargo loss and damage; and

• general liability claims.

We currently maintain insurance for:

• motor-vehicle related bodily injury and property damage claims;

• workers’ compensation insurance coverage on our employees; and

• general liability claims.

Our insurance program includes a self-insured deductible of $250,000 per incident for bodily injury, property damage, and currently workers’ compensation (with a basket at $250,000 for all three). In addition, we currently maintain insurance policies with a total limit of $75 million, of which $74 million is provided under umbrella and excess liability policies and $1 million is provided under a primary liability policy. The $250,000 deductible per incident could adversely affect our profitability, particularly in the event of an increase in the frequency or severity of incidents. Additionally, we are self-insured for damage to the equipment that we own and lease, as well as for cargo losses and such self-insurance is not subject to any maximum limitation. In addition, even where we have insurance, our insurance policies may not provide coverage for certain claims against us or may not be sufficient to cover all possible liabilities.

Our self-insured retentions require us to make estimates of expected loss amounts and accrue such estimates as expenses. Changes in estimates may materially and adversely affect our financial results. In addition, our insurance does not cover claims for punitive damages. As a result of the increase in our self-insured retention, it is likely that we will increase our claims accrual as a result of a possible increase in our claims expense.

We are subject to changing conditions and pricing in the insurance marketplace that in the future could change dramatically the cost or availability of various types of insurance. To the extent these costs cannot be passed on to our customers in increased prices, increases in insurance costs could reduce our future profitability and cash flow.

In addition, our insurance carriers and the states in which we

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operate require us to post either letters of credit or surety bonds to collateralize our self-insured retention. We currently have letters of credit of $3.3 million outstanding to satisfy these obligations. If our insurance carriers or the states in which we operate require us to increase the amount of collateral we provide in the future, we could face increased costs, including the payment of additional fees to the providers of letters of credit. Since our letters of credit are considered debt under the financial covenants for our financing arrangements, increases in the amount of letters of credit we have outstanding to collateralize our self-insurance obligations will reduce borrowing availability under our credit agreement and reduce our capacity for additional borrowings.

Moreover, any accident or incident involving us, even if we are fully insured or not held to be liable, could negatively affect our reputation among customers and the public, thereby making it more difficult for us to compete effectively, and could significantly affect the cost and availability of insurance in the future. Because we provide "last mile" fuels delivery services, we generally perform our services in more crowded areas, which increases the possibility of an accident involving our trucks.

We operate in a highly regulated industry, and increased costs of compliance with, or liability for violation of, existing or future regulations could significantly increase our costs of doing business.

As a motor carrier, we are subject to regulation by the Federal Motor Carrier Safety Administration ("FMCSA") and DOT, and by various federal and state agencies. These regulatory authorities exercise broad powers governing various aspects such as operating authority, safety, hours of service, hazardous materials transportation, financial reporting and acquisitions. There are additional regulations specifically relating to the trucking industry, including testing and specification of equipment, product-handling requirements and drug testing of drivers. In 2003, Florida Rock & Tank Lines, Inc. underwent a compliance review by the FMCSA in which we retained our satisfactory DOT safety rating. Any downgrade in our DOT safety rating (as a result of new regulations or otherwise) could adversely affect our business.

The trucking industry is subject to possible regulatory and legislative changes that may affect the economics of the industry by requiring changes in operating practices, emissions or by changing the demand for common or contract carrier services or the cost of providing trucking services. Possible changes include:

• increasingly stringent environmental regulations, including changes intended to address climate change;

• restrictions, taxes or other controls on emissions;

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• regulation specific to the energy market and logistics providers to the industry;

• changes in the hours-of-service regulations, which govern the amount of time a driver may drive in any specific period;

• driver and vehicle electronic logging requirements;

• requirements leading to accelerated purchases of new tractors;

• mandatory limits on vehicle weight and size;

• driver hiring restrictions;

• increased bonding or insurance requirements; and

• mandatory regulations imposed by the Department of Homeland Security.

From time to time, various legislative proposals are introduced, including proposals to increase federal, state, or local taxes, including taxes on motor fuels and emissions, which may increase our operating costs, require capital expenditures or adversely impact the recruitment of drivers.

Restrictions on emissions or other climate change laws or regulations could also affect our customers that use significant amounts of energy or burn fossil fuels in producing or delivering the products we carry. We also could lose revenue if our customers divert business from us because we have not complied with their sustainability requirements.

Our business may be adversely affected by terrorist attacks and anti-terrorism measures.

In the aftermath of the terrorist attacks of September 11, 2001, federal, state and municipal authorities have implemented and are implementing various security measures, including checkpoints and travel restrictions on large trucks and fingerprinting of drivers in connection with new hazardous materials endorsements on their licenses. Such measures may have costs associated with them which we are forced to bear. While we believe we are in compliance with these new regulations, if existing requirements are interpreted differently by governmental authorities or additional new security measures are required, the timing of our deliveries may be disrupted and we may fail to meet the needs of our customers or incur increased expenses to do so. Such developments could have a material adverse effect on our operating results. Moreover, large trucks containing petroleum products are potential terrorist targets, and we may be obligated to take measures, including possible capital expenditures intended to protect our trucks. In addition, the insurance premiums charged for some or all of the coverage maintained by us could continue to increase dramatically or such coverage could be unavailable in the future.

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Our operations involve hazardous materials and could result in significant environmental liabilities and costs.

Our activities, which involve the transportation, storage and disposal of fuels and other hazardous substances and wastes, are subject to various federal, state and local health and safety laws and regulations relating to the protection of the environment, including, among others, those governing the transportation, management and disposal of hazardous materials, vehicle emissions, underground and above ground storage tanks and the cleanup of contaminated sites. Our operations involve risks of fuel spillage or seepage, hazardous waste disposal and other activities that are potentially damaging to the environment. If we are involved in a spill or other accident involving hazardous substances, or if we are found to be in violation of or liable under applicable laws or regulations, it could significantly increase our cost of doing business.

Most of our truck terminals are located in industrial areas, where groundwater or other forms of environmental contamination may have occurred. Under environmental laws, we could be held responsible for the costs relating to any contamination at those or other of our past or present facilities and at third-party waste disposal sites, including cleanup costs, fines and penalties and personal injury and property damages. Under some of these laws, such as the Comprehensive Environmental Response Compensation and Liability Act (also known as the Superfund law) and comparable state statutes, liability for the entire cost of the cleanup of contaminated sites can be imposed upon any current or former owner or operator, or upon any party who sent waste to the site, regardless of the lawfulness of any disposal activities or whether a party owned or operated a contaminated property at the time of the release of hazardous substances. From time to time, we have incurred remedial costs and/or regulatory penalties with respect to spills and releases in connection with our operations and, notwithstanding the existence of our environmental management program, such obligations may be incurred in the future. The discovery of contamination or the imposition of additional obligations or liabilities in the future could result in a material adverse effect on our financial condition, results of operations or our business reputation.

Environmental laws and regulations are complex, change frequently and have tended to become more stringent over time. If we fail to comply with applicable environmental laws and regulations, we could also be subject to substantial fines or penalties and to civil and criminal liability. As a result, our costs of complying with current or future environmental laws or liabilities arising from such laws may have a material adverse effect on our business, results of operations or financial condition.

We have significant ongoing capital requirements.

Our business requires substantial ongoing capital investment, particularly for tractors, trailers, terminals and technology. Our

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capital expenditures were approximately $10.5 million, $15.6 million and $13.0 million in 2012, 2013 and 2014, respectively, and we expect to make capital expenditures of approximately $11.3 million during fiscal 2015. We expect that cash flow from operations and borrowings under our revolving credit facility will be our primary sources of financing for capital expenditures. If we are unable to generate sufficient cash from operations or borrow sufficient funds on terms that are acceptable to us, we may be forced to limit our growth and operate existing equipment for significant periods of time, each of which could have a material adverse effect on our business, results of operations and financial condition.

We may face difficulty in purchasing new equipment on a timely basis. Any delay in delivery of equipment could impair our ability to serve our customers, and, to the extent that we must obtain equipment from alternative sources at increased prices, could result in a significant increase in our anticipated capital expenditures and, accordingly, have a material adverse effect on our business, results of operations and financial condition.

Financing may not always be available to fund our activities.

We usually must spend and risk a significant amount of capital to fund our activities. Although most capital needs are funded from operating cash flow, the timing of cash flows from operations and capital funding needs may not always coincide, and the levels of cash flow may not fully cover capital funding requirements.

From time to time, we may need to supplement our cash generated from operations with proceeds from financing activities. Substantially concurrently with the separation, we expect to enter into a credit facility to provide us with available financing for working capital and other general corporate purposes. This credit facility is intended to meet any ongoing cash needs in excess of internally generated cash flows.

Our revolving credit agreement restricts our ability to engage in some business activities.

Our revolving credit agreement will contain customary negative covenants and other financial and operating covenants that will, among other things:

• restrict our ability to incur certain additional indebtedness;

• restrict our ability to make certain investments;

• restrict our ability to merge with another company;

• restrict our ability to pay dividends;

• require us to maintain financial coverage ratios; and

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• prevent us from encumbering certain assets except as approved by the lender.

These restrictions could cause us to default on our credit agreement or negatively affect our operations.

Our growth will depend in part upon making acquisitions, which are subject to the uncertainties of evaluating potential liabilities, integration risks and other difficulties.

Our growth strategy depends in part upon our ability to acquire regional competitors in strategically desirable locations and to integrate them successfully into our existing operations.

Successful acquisitions require an assessment of a number of factors, many of which are beyond our control. These factors include operating costs and potential environmental and other liabilities of acquired companies and the extent to which such acquired companies would retain existing customers and add profitable routes to our geographic scope of coverage. Such assessments are inexact and their accuracy is inherently uncertain. In connection with our assessments, we perform a review of the companies to be acquired that we believe is generally consistent with industry practices. However, such a review will not reveal all existing or potential problems. In addition, our review may not permit us to become sufficiently familiar with the companies to fully assess their deficiencies and capabilities.

In seeking acquisitions, we may be required to compete with other potential acquirors, some of which may have substantially greater financial and other resources than those available to us. We are unable to predict whether and when any prospective acquisition candidate will become available or the likelihood that any acquisition will be completed on acceptable terms. Further, if we make future acquisitions, we may issue shares of capital stock that dilute other shareholders, incur debt, assume significant liabilities and create additional expenses related to intangible assets, any of which might reduce our reported earnings or earnings per share. In addition, any financing that we might need for these acquisitions may only be available to us on terms that restrict our business and acquisition-related accounting charges may adversely affect our balance sheet and results of operations.

Additionally, we may encounter difficulties in integrating acquired companies into our existing operations and business because they may have substantially different operating characteristics or be in different geographic locations than our existing operations. Once integrated, acquired businesses may not achieve levels of revenues, profitability or productivity comparable to our existing business or otherwise perform as expected. Also, acquisitions may involve difficulties in the retention of personnel, diversion of management's attention, risks of the customers of acquired companies allocating all or a portion of their business to our

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competitors while they evaluate the impact of the acquisition, unexpected legal liabilities, and tax and accounting issues. Any inability on our part to consummate and integrate future acquisitions successfully may have a material adverse effect on our results of operations and financial condition.

Risks Relating to the Real Estate Business

Our business may be adversely affected by seasonal factors and harsh weather conditions.

Our real estate group is adversely affected by reduced construction activity during periods of inclement weather. These factors can cause our operating results to fluctuate from quarter to quarter. An occurrence of unusually harsh or long-lasting inclement weather such as hurricanes, tornadoes and heavy snowfalls could have an adverse effect on our operations and profitability.

Our revenues depend in part on construction sector activity levels, which tend to be cyclical.

Our real estate group receives part of its revenues from royalties on construction aggregates mined on our properties. Thus, our results depend in part on residential, commercial and infrastructure construction activity and spending levels. The construction industry in our markets tends to be cyclical. Construction activity and spending levels vary across our markets and are influenced by interest rates, inflation, consumer spending habits, demographic shifts, environmental laws and regulations, employment levels and the availability of funds for public infrastructure projects. Economic downturns may lead to recessions in the construction industry, either in individual markets or nationally.

Our operations are subject to various environmental laws and regulations, the violation of which could result in substantial fines or penalties.

We are subject to various environmental laws and regulations Our operations involve the risks of fuel seepage, environmental damage, and hazardous waste disposal, among others. We also maintain bulk fuel storage and fuel islands at several of our facilities. Although we have instituted programs to monitor and control environmental risks and promote compliance with applicable environmental laws and regulations, the failure to comply with applicable laws or regulations could subject us to liabilities, including substantial fines or penalties or civil and criminal liability, that could have a materially adverse effect on our business and operating results.

Environmental liability for contamination may include the following, without limitation: investigation and feasibility study costs, remediation costs, litigation costs, oversight costs,

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monitoring costs, institutional control costs, penalties from state and federal agencies, and third-party claims. These costs could be substantial and in extreme cases could exceed the value of the contaminated property. Moreover, operations on-site may be required to be suspended until certain environmental contamination is remediated and/or permits are received and environmental laws can impose permanent restrictions on the manner in which a property may be used depending on the extent and nature of the contamination. This may result in a default of the terms of the lease entered into with our tenants. Environmental laws also may create liens on contaminated sites in favor of the government for damages and costs it incurs to address such contamination. In addition, the presence of hazardous substances at, on, under or from a property may adversely affect our ability to sell the property or borrow using the property as collateral, thus harming our financial condition.

The presence of contaminated material at our RiverFront on the Anacostia development site may subject us to substantial environmental liability and costs.

With respect to our joint venture with MRP known as RiverFront on the Anacostia in Washington, D.C., preliminary environmental testing completed in the summer of 2012 on the portion of the site that will contain the first phase of the development indicated the presence of contaminated material that will have to be specially handled in the event of excavation in conjunction with construction. While we believe that the prior tenant is responsible for these costs and is required to indemnify us against any environmental liabilities arising from its activities on the property, we could nevertheless be subject to strict liability under environmental laws because we own the property. We may face this liability regardless of our lack of knowledge of the contamination or whether or not we caused the contamination. There is also a risk that the prior tenant may not satisfy their environmental compliance and indemnification obligations under the lease. Any of these events could substantially increase our cost of operations.

Notwithstanding the prior tenant’s obligations to us under the lease, with respect to MRP, we are solely responsible to appropriately handle the removal of any known hazardous substances on Phase 1 of the property up to a proposed cap of $1.871 million. MRP has agreed to share such costs above that cap. Accordingly, we recorded an expense in the fourth quarter of fiscal 2012 of $1,771,000 for this environmental remediation liability which is the lower end of the range of estimates. The actual expense may be materially higher or lower depending upon the determined responsibility of the prior tenant, our ability to collect from such prior tenant and actual costs incurred. In the event these costs are materially higher than forecasted, it could have a material adverse effect on our financial condition and results of operations.

Further testing during the fourth quarter of fiscal 2013 revealed the existence of contamination on the other three phases and we are

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requesting the prior tenant take financial responsibility for removal of this contamination as well. The Company has no obligation to remediate this contamination on Phases II, III and IV until such time as it commences construction there.

Uninsured losses could significantly reduce our earnings.

We self-insure for a portion of our claims exposure resulting from workers’ compensation, auto liability, general liability, cargo and property damage claims, as well as employees’ health insurance. We also are responsible for our legal expenses relating to such claims. We maintain insurance above the amounts for which we self-insure with licensed insurance carriers. Although we believe the aggregate insurance limits should be sufficient to cover reasonably expected claims, it is possible that one or more claims could exceed our aggregate coverage limits. Also, there are some types of losses such as from hurricanes, terrorism, wars, or earthquakes where insurance is limited and/or not economically justifiable. If an uninsured loss occurs, we could lose both the invested capital and anticipated revenues. We accrue currently for estimated incurred losses and expenses. We periodically evaluate and adjust our claims accrued liability to reflect our experience. However, ultimate results may differ from our estimates, which could result in losses over our accrued amounts.

We may be unable to renew leases or relet space as leases expire.

When a lease expires, a tenant may elect not to renew it. We may not be able to relet the property on similar terms. The terms of renewal or re-lease (including the cost of required renovations and/or concessions to tenants) may be less favorable than the prior lease. If we are unable to relet all or a substantial portion of our properties, or if the rental rates upon such reletting are significantly lower than expected rates, our cash generated before debt repayments and capital expenditures may be adversely affected. As of September 30, 2014, leases at our properties representing approximately 13%, 11% and 18% of the total square footage of buildings completed prior to September 2014 were scheduled to expire in fiscal year 2015, 2016 and 2017, respectively.

We may be unable to lease currently vacant space.

Vacant space totals 10% in our business parks and only a small portion of that has leases signed for future occupancy. If we are unable to obtain leases sufficient to cover carrying costs then our cash flows may continue to be adversely affected.

The bankruptcy or insolvency of significant tenants with long-term leases may adversely affect income produced by our properties.

We have 15 buildings in our business parks that are single-tenant occupied representing 48% of developed property rentals under long-term leases. We have 12 other tenants with leases in excess of five years. Should tenants default on their obligations, our cash flow would be adversely affected and we may not be able to find another tenant to occupy the space under similar terms or have to make expenditures to retrofit and/or divide the space. In addition we may have to incur a non-cash expense for a significant amount of

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deferred rent revenue generated from the accounting requirement to straight-line rental revenues. The bankruptcy or insolvency of a major tenant may also adversely affect the income produced by a property. If any of our tenants becomes a debtor in a case under the U.S. Bankruptcy Code, we cannot evict that tenant solely because of its bankruptcy. The bankruptcy court may authorize the tenant to reject and terminate its lease with us. Our claim against such a tenant for unpaid future rent would be subject to a statutory limitation that might be substantially less than the remaining rent actually owed to us under the tenant’s lease. Any shortfall in rent payments could adversely affect our cash flow.

A decline in the economic conditions in Baltimore-Washington-Northern Virginia area could adversely affect our business.

Nearly all of our office/warehouse properties are located in the Baltimore-Washington-Northern Virginia area. As a result of our geographic concentration, we depend upon the local conditions in these markets, including local real estate conditions. We are, therefore, subject to increased exposure (positive or negative) to economic and other competitive factors specific to markets in confined geographic areas. Our operations may also be affected if too many competing properties are built in these markets. An economic downturn in these markets could adversely affect our operation. We cannot assure you that these markets will continue to grow or will continue to provide favorable demand for our office/warehouse product.

Our inability to obtain necessary approvals for property development could adversely affect our profitability.

We may be unable to obtain, or incur delays in obtaining, necessary zoning, land-use, building, occupancy and other required governmental permits and authorizations, which could result in increased costs or abandonment of these projects. Before we can develop a property, we must obtain a variety of approvals from local and state governments with respect to such matters as zoning, density, parking, subdivision, site planning and environmental issues. Legislation could impose moratoriums on new real estate development and/or land-use conversions from mining to development. These factors may reduce our profit or growth and may limit the value of these properties.

Real estate investments are not as liquid as other types of assets.

The illiquid nature of real estate investments may limit our ability to react promptly to changes in economic or other conditions. In addition, significant expenditures associated with real estate investments, such as mortgage payments, real estate taxes and maintenance costs, are generally not reduced when circumstances cause a reduction in income from the investments. Thus, the illiquid nature of our real estate investments could adversely affect our profitability under certain economic conditions.

Our debt service obligations may have adverse consequences on our business operations.

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We use debt to finance our operations, including acquisitions of properties. Our use of debt may have adverse consequences, including the following:

· Our cash flows from operations may not be sufficient to meet required payments of principal and interest.

· We may be forced to dispose of one or more of our properties, possibly on disadvantageous terms, to make payments on our debt.

· We may default on our debt obligations, and the lenders may foreclose on our properties that collateralize those loans.

· A foreclosure on one of our properties could create taxable income without any accompanying cash proceeds to pay the tax.

· A default under a mortgage loan that has cross default provisions may cause us to automatically default on another loan.

· We may not be able to refinance or extend our existing debt.

· The terms of any refinancing or extension may not be as favorable as the terms of our existing debt.

· We may not be able to issue debt on unencumbered properties under reasonable terms to finance growth of our portfolio of properties.

· We may be subject to a significant increase in the variable interest rates on our unsecured line of credit or unsecured term loan, which could adversely impact our operations.

· Our debt agreements have yield maintenance requirements that result in a penalty if we prepay loans.

As of September 30, 2014, we had outstanding non-recourse mortgage indebtedness of $45,593,000, secured by developed real estate properties having a carrying value of $57,146,000.

Our uncollateralized revolving credit agreement restricts our ability to engage in some business activities.

Our uncollateralized revolving credit agreement contains customary negative covenants and other financial and operating covenants that, among other things:

· restricts our ability to incur certain additional indebtedness;

· restricts our ability to make certain investments;

· restricts our ability to merge with another company;

· restricts our ability to pay dividends;

· requires us to maintain financial coverage ratios; and

· requires us to not encumber certain assets except as approved by the lenders.

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These restrictions could cause us to default on our unsecured line of credit or negatively affect our operations.

Our real estate segment faces competition from numerous sources.

As a developer of flexible warehouse/office space, we compete with numerous developers, owners and operators of real estate, many of which own properties similar to ours in the same submarkets in which our properties are located. If our competitors offer space at rental rates below current market rates, or below the rental rates we currently charge our tenants, we may lose potential tenants and we may be pressured to reduce our rental rates below those we currently charge in order to retain tenants when our tenants’ leases expire. As a result, our financial condition, results of operations, cash flow and ability to satisfy our debt service obligations could be materially adversely affected.

Construction costs may be higher than anticipated.

Our long-term business plan includes a number of construction projects. The construction costs of these projects may exceed original estimates and possibly make the completion of a property uneconomical. Building material commodity shortages, construction delays/stoppages and/or rapidly escalating construction costs may out-pace market rents, adversely affecting profits. The market environment and existing lease commitments may not allow us to raise rents to cover these higher costs.

Risks Relating to our Common Stock

Certain shareholders have effective control of a significant percentage of FRP's common stock and likely will control the outcome of any shareholder vote.

As of September 30, 2014, three of our directors, Edward L. Baker, John D. Baker II and Thompson S. Baker II, beneficially own approximately 23% of the outstanding shares of our common stock and certain of their family members beneficially own an additional 10%. As a result, these individuals effectively may have the ability to direct the election of all members of our board of directors and to exercise a controlling influence over its business and affairs, including any determinations with respect to mergers or other business combinations involving the Company, its acquisition or disposition of assets, its borrowing of monies, its issuance of any additional securities, its repurchase of common stock and its payment of dividends.

Provisions in our articles of incorporation and bylaws and certain provisions of Florida law could delay or prevent a change in control of FRP.

The existence of some provisions of our articles of incorporation and bylaws and Florida law could discourage, delay or prevent a change in control of FRP that a shareholder may consider favorable. These include provisions:

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• providing for a classified board of directors;

• providing that  directors may be removed by our shareholders only for cause;

• establishing supermajority vote requirements for shareholders to approve certain business combinations;

• establishing supermajority vote requirements for  shareholders to amend certain provisions of the articles of incorporation and bylaws;

• authorizing a large number of shares of stock that are not yet issued, which would allow FRP's board of directors to issue shares to persons friendly to current management, thereby protecting the continuity of its management, or which could be used to dilute the stock ownership of persons seeking to obtain control of FRP;

• prohibiting shareholders from calling special meetings of shareholders or taking action by written consent; and

• imposing advance notice requirements for nominations of candidates for election to our board of directors at the annual shareholder meetings.

These provisions apply even if a takeover offer may be considered beneficial by some shareholders and could delay or prevent an acquisition that our board of directors determines is not in the company's or the shareholders’ best interests.

FRP may issue preferred stock with terms that could dilute the voting power or reduce the value of our common stock.

Our articles of incorporation authorize us to issue, without the approval of our shareholders, one or more classes or series of preferred stock having such designations, powers, preferences and relative, participating, optional and other rights, and such qualifications, limitations or restrictions as our board of directors generally may determine. The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the value of FRP's common stock. For example, FRP could grant holders of preferred stock the right to elect some number of

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its directors in all events or on the happening of specified events or the right to veto specified transactions. Similarly, the repurchase or redemption rights or dividend, distribution or liquidation preferences FRP could assign to holders of preferred stock could affect the residual value of the common stock.

Item 1B. UNRESOLVED STAFF COMMENTS.

None.

Item 2. PROPERTIES.

Transportation Segment Properties. The Company has 21 sites for its trucking terminals in Alabama, Florida, Georgia, North Carolina, South Carolina and Tennessee. The Company owns 13 of these sites and leases 8.

Mining Royalty Land Segment Construction Aggregates Properties. The following table summarizes the Company's construction aggregates locations and estimated reserves at September 30, 2014 a substantial portion of which are leased to Vulcan.

		Tons of
	Tons Sold	Estimated
	in Year	Reserves
	Ended	at
	9/30/14	9/30/14	Approximate
	(000's)	(000's)	Acres Owned
The Company owns seven
locations currently being
mined in Grandin, Keuka,
Newberry, Florida; Columbus,
Macon, and Tyrone, Georgia;
and Manassas, Virginia.	4,575	332,680	10,423
The Company owns six locations
not currently being mined in
Ft. Myers, Airgrove/
Lake County (temporary),
Marion County, Astatula/Lake
County, Lake Louisa, Florida;
and Forest Park, Georgia.	1	96,330	4,771

These figures exclude Brooksville, Florida as the property was transferred October 4, 2006 to a joint venture with Vulcan for development. Brooksville tons sold in fiscal 2014 were 371,000 and estimated reserves were 6,308,000 at September 30, 2014.

The Ft. Myers residential property in Lee County, Florida is part of a 1,993 acre site under a long-term mining lease to Vulcan. In June, 2010 the Company entered into a letter agreement with Vulcan

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Materials Company that required modifications to the existing mining lease on our property, such that the mining will be accelerated and the mining plan will be revised to accommodate future construction of up to 105 residential dwelling units around the mined lakes. In return the Company agreed to grant Lee County a right of way for a road and to place a conservation easement on part of the property.

Mining Royalty Land Segment Brooksville Joint Venture. On October 4, 2006, a subsidiary of the Company (FRP) entered into a Joint Venture Agreement with Vulcan Materials Company (formerly Florida Rock Industries, Inc.) to form Brooksville Quarry, LLC, a real estate joint venture to develop approximately 4,300 acres of land near Brooksville, Florida. 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 in August 2012.

Mining Royalty Land Segment Other Properties. The segment owns 1,923 acres of investment properties in Gulf Hammock, Brooksville, Palatka, and Polk County, Florida and Yatesville and Henderson, Georgia.

Developed Properties Rentals Segment. At September 30, 2014 certain developed real estate properties having a carrying value of $57,146,000 were pledged on long-term non-recourse notes with an outstanding principal balance totaling $45,593,000. At September 30, 2014, the Company owned 407 acres in 16 developed parcels of land all but one of which are in the Mid-Atlantic region of the United States as follows:

1) Hillside Business Park in Anne Arundel County, Maryland consists of 49 usable acres. Four warehouse/office buildings and one suburban office building totaling 567,473 square feet exist on the property and are 96% occupied.

2) Lakeside Business Park in Harford County, Maryland consists of 84 usable acres. Nine warehouse/office buildings totaling 893,722 square feet exist on 64 of these acres and are 89% occupied. The remaining 20 acres are available for future development and have the potential to offer an additional 266,530 square feet of comparable product.

3) 6920 Tudsbury Road in Baltimore County, Maryland contains 5.3 acres with 86,100 square feet of warehouse/office space that is 100% occupied by a single tenant.

4) 8620 Dorsey Run Road in Howard County, Maryland contains 5.8 acres with 85,100 square feet of warehouse/office space that is 100% occupied.

5) Rossville Business Center in Baltimore County, Maryland contains approximately 10 acres with 190,517 square feet of warehouse/office space and is 100% occupied.

33

6) 34 Loveton Circle in suburban Baltimore County, Maryland contains 8.5 acres with 33,708 square feet of office space, which is 81% occupied including 24% of the space occupied by the Company.

7) Oregon Business Center in Anne Arundel County, Maryland contains approximately 17 acres with 195,615 square feet of warehouse/office space, which is 83% occupied.

8) Arundel Business Center in Howard County, Maryland contains approximately 11 acres with 162,796 square feet of warehouse/office space, which is 100% occupied.

9) 100-400 Interchange Boulevard in New Castle County, Delaware contains approximately 17 acres with 303,006 square feet of warehouse/office space, which is 60% occupied. Chrysler and General Motors plant closings in 2008 continued to keep a reduced demand for space in this market. The remaining 8.8 acres are available for excess trailer storage or an additional 93,600 square feet of comparable product.

10) 1187 Azalea Garden Road in Norfolk, Virginia contains approximately 12 acres with 188,093 square feet of warehouse/office space, which is 100% occupied.

11) Windlass Run Business Park in Baltimore County, Maryland contains 69,474 square feet of warehouse/office space on 4.7 acres that is currently 100% occupied. An additional 26 acres (excluding wetlands) of fully developed land is available with the potential to offer 386,626 square feet of warehouse, office, flex and retail buildings.

12) 155 E. 21^st Street in Duval County, Florida contains approximately 6 acres with 68,757 square feet of office space which is 100% leased to Vulcan.

13) Hollander 95 Business Park in Baltimore City, Maryland contains 82,800 square feet of warehouse/office space on 3.8 acres which is 100% leased. An additional 38 acres of partially developed land is available with the potential to offer 425,750 square feet of warehouse, office, hotel and flex buildings.

14) Patriot Business Park in Prince William County, Maryland contains 243,150 square feet of office space on 18 acres which is 100% occupied. The Company entered into a build to suit lease for a 129,850 square foot building situated on 8 acres which is estimated to commence first quarter of fiscal 2015. The remaining 24 acres have the potential to offer an additional 198,150 square feet of comparable product.

15) Transit Business Park in Baltimore, Maryland contains five buildings totaling 232,318 square feet on 14.5 acres and is 66% occupied.

34

16) Kelso Business Park in Baltimore County, Maryland, purchased on June 6, 2014, consists of two buildings on 10.2 acres totaling 69,680 square feet and is 100% occupied.

Developed Property Rentals Segment Future Planned Developments. At September 30, 2014 the Company owned the following future development parcels:

1) Windlass Run Residential (previously Bird River) phase 2, located in southeastern Baltimore County, Maryland, is a 74 acre tract of land adjacent to our Windlass Run Business Park. The property was rezoned in September 2007 to allow for additional density. In July 2008, the Company entered into an agreement to sell the entire 121 acres at a purchase price of $25,075,000 and closing was scheduled to occur in the first quarter of calendar 2012. The contract purchaser had placed non-refundable deposits of $1,000,000 under this contract in escrow. In October 2011 the contract purchaser terminated its agreement to purchase the property and released the $1,000,000 escrow deposit to the company’s subsidiary, FRP Bird River, LLC. along with all permits, engineering work, plans and other development work product with regards to the property. The Company continued the entitlement process for this parcel of land for residential development as a planned unit development (PUD) and was successful in receiving approval for up to 412 dwelling units. In September 2012, the Company received a non-binding letter of intent to sell the property for $18.8 million in two phases. The letter of intent to sell the property was converted into 2 executed contracts that expired during the due diligence period. The Company executed two contracts on April 17, 2013 with another buyer for the sale of phase 1 of the property in the quarter ending September 30, 2013 for $8.0 million and the balance for $11.0 million approximately 18 months later. The sale of phase 1 was completed in August of 2013 and resulted in a gain of $4,928,000. The sale of phase two is scheduled to close in March of 2015 and would generate a gain of approximately $6.0 million.

2) Anacostia River. The Company owns a 5.8 acre parcel of undeveloped real estate in Washington D.C. that fronts the Anacostia River and is adjacent to the Washington Nationals Baseball Park. The parcel was leased to a subsidiary of Vulcan Materials Company from 1986 through August 2011. In September 2011 Vulcan commenced a long term lease for a Company owned 2.1 acre tract which is nearby on the same bank of the Anacostia River. The approved planned unit development for the 5.8 acre parcel permits the Company to develop a four building, mixed use project, containing approximately 545,800 square feet of office and retail space and approximately 569,600 square feet of additional space for residential and hotel uses. The approved development would include numerous publicly accessible open spaces and a waterfront esplanade along the Anacostia River.

On March 30, 2012 the Company entered into a Contribution Agreement with MRP SE Waterfront Residential, LLC. (“MRP”) to form a joint

35

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 a portion 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 contribute 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 will be non-recourse to Patriot. Construction commenced in October 2014. At this point the Company anticipates lease up scheduled in 2016 and 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.

3) Leister property in Hampstead, Carroll County, Maryland is a 117 acre parcel located adjacent to State Route 30 bypass. The parcel is currently zoned for industrial use. Alternative uses are being investigated in order to maximize this assets’ profitability and expedite its disposition.

Item 3. LEGAL PROCEEDINGS.

Note 12 to the Consolidated Financial Statements included in the accompanying 2014 Annual Report to Shareholders is incorporated herein by reference.

Item 4. MINE SAFETY DISCLOSURES.

None.

36

PART II

Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

There were approximately 469 holders of record of FRP Holdings, Inc. common stock, $.10 par value, as of September 30, 2014. The Company's common stock is traded on the Nasdaq Stock Market (Symbol FRPH). Information concerning stock prices is included under the caption "Quarterly Results" on page 7 of the Company's 2014 Annual Report to Shareholders, and such information is incorporated herein by reference. The Company has not paid a cash dividend in the past and it is the present policy of the Board of Directors not to pay cash dividends. Information concerning restrictions on the payment of cash dividends is included in Note 3 to the consolidated financial statements included in the accompanying 2014 Annual Report to Shareholders and such information is incorporated herein by reference. Information regarding securities authorized for issuance under equity compensation plans is included in Item 12 of Part III of this Annual Report on Form 10-K and such information is incorporated herein by reference.

Purchases of Equity Securities by the Issuer and Affiliated

Purchasers

						(c)
						Total
						Number of
						Shares		(d)
						Purchased		Approximate
		(a)				As Part of		Dollar Value of
		Total		(b)		Publicly		Shares that May
		Number of		Average		Announced		Yet Be Purchased
		Shares		Price Paid		Plans or		Under the Plans
Period		Purchased		per Share		Programs		or Programs (1)
	July 1
	Through
	July 31		—	$	—		—	$	3,682,000
	August 1
	Through
	August 31		—	$	—		—	$	3,682,000
	September 1
	Through
	September 30		—	$	—		—	$	3,682,000
	Total		—	$	—		—

37

(1) In December, 2003, the Board of Directors authorized management to expend up to $6,000,000 to repurchase shares of the Company’s common stock from time to time as opportunities arise. On February 19, 2008, the Board of Directors authorized management to expend up to an additional $5,000,000 to repurchase shares of the Company’s common stock from time to time as opportunities arise.

Item 6. SELECTED FINANCIAL DATA.

Information required in response to this Item 6 is included under the caption "Five Year Summary" on page 7 of the Company's 2014 Annual Report to Shareholders and such information is incorporated herein by reference.

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

Information required in response to Item 7 is included under the caption "Management’s Discussion and Analysis of Financial Condition and Results of Operation" on pages 8 through 17 of the Company’s 2014 Annual Report to Shareholders and such information is incorporated herein by reference.

Item 7.A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Interest Rate Risk - We are exposed to the impact of interest rate changes through our variable-rate borrowings under the Credit Agreement. Under the Credit Agreement, the applicable margin for borrowings at September 30, 2014 was 1.0%. The applicable margin for such borrowings will be reduced or increased in the event that our debt to capitalization ratio as calculated under the Credit Agreement Facility exceeds a target level.

At September 30, 2014 a 1% increase in the current per annum interest rate would result in $176,447 of additional interest expense during the next 12 months. The foregoing calculation assumes an instantaneous 1% increase in the rates under the Credit Agreement and that the principal amount under the Credit Agreement is the amount outstanding as of September 30, 2014. The calculation therefore does not account for the differences in the market rates upon which the interest rates of our indebtedness are based or possible actions, such as prepayment, that we might take in response to any rate increase.

For its debt instruments with variable interest rates, changes in interest rates affect the amount of interest expense incurred. The following table provides information about the Company’s long-term debt and variable rate debt outstanding at September 30, 2014 (dollars in thousands):

38

											There				Fair
Liabilities:	2015		2016		2017		2018		2019		after		Total		Value
Scheduled
maturities of
long-term debt:
Fixed Rate	$	4,534	$	4,616	$	4,887	$	4,674	$	3,885	$	22,997	$	45,593	$49	,436
Average
interest rate		6.2%		6.1%		6.1%		6.0%		5.9%		5.9%
Variable Rate	$	17,645
Average
interest rate		1.2%

Commodity Price Risk – The price and availability of diesel fuel are subject to fluctuations due to changes in the level of global oil production, seasonality, weather, global politics and other market factors. Historically, we have been able to recover a significant portion of fuel price increases from our customers in the form of fuel surcharges. The price and availability of diesel fuel can be unpredictable as well as the extent to which fuel surcharges can be collected to offset such increases. In fiscal 2014 and 2013, a significant portion of fuel costs was covered through fuel surcharges.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Information required in response to this Item 8 is included under the caption "Quarterly Results" on page 7 and on pages 18 through 33 of the Company's 2014 Annual Report to Shareholders. Such information is incorporated herein by reference.

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

Item 9A. CONTROLS AND PROCEDURES.

CONCLUSION REGARDING THE EFFECTIVENESS OF DISCLOSURE CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including our principal executive officer, principal financial officer and chief accounting officer, we conducted an evaluation of our disclosure controls and procedures, as such terms is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on this evaluation, our principal executive officer, our principal financial officer and our chief accounting officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Annual Report.

39

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the framework in the Internal Control-Integrated Framework (2013), our management concluded that our internal control over financial reporting was effective as of September 30, 2014.

Hancock Askew & Co., LLP, the independent registered certified public accounting firm that audited the consolidated financial statements included in this Annual Report on Form 10-K, has also audited the effectiveness of our internal control over financial reporting as of September 30, 2014, as stated in their report which appears in Item 8.

CHANGE IN INTERNAL CONTROL OVER FINANCIAL REPORTING

During the fourth quarter of 2014, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting, including any corrective actions with regards to material weaknesses.

INHERENT LIMITATIONS OVER INTERNAL CONTROLS

Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

i. pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

ii. provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

iii. provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or

40

disposition of our assets that could have a material effect on the consolidated financial statements.

Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations, including the possibility of human error and circumvention by collusion or overriding of controls. Accordingly, even an effective internal control system may not prevent or detect material misstatements on a timely basis. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

ITEM 9B. OTHER INFORMATION.

None.

PART III

Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Information regarding the Company’s executive officers is set forth under the caption "Executive Officers of the Registrant" in Part I of this Form 10-K. Information concerning directors (including the disclosure regarding audit committee financial experts), required in response to this Item 10, is included under the captions "Election of Directors", "Board Leadership Structure and Committee Membership – Audit Committee" and "Section 16(a) Beneficial Ownership Reporting Compliance" in the Company's Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2014.

The Company has adopted a Financial Code of Ethical Conduct applicable to its principal executive officers, principal financial officers and principal accounting officers. A copy of this Financial Code of Ethical Conduct is filed as Exhibit 14 to this Form 10-K. The Financial Code of Ethical Conduct is available on our web site at www.patriottrans.com under the heading Corporate Governance.

Item 11. EXECUTIVE COMPENSATION.

Information required in response to this Item 11 is included under the captions "Compensation Discussion and Analysis," "Executive Compensation," "Compensation Committee Report," "Non-Employee Director Compensation," "Board Leadership Structure and Committee Membership – Compensation Committee," and "Shareholder Return Performance" in the Company's Proxy Statement and such information

41

is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2014.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

Information required in response to this Item 12 is included under the captions "Common Stock Ownership of Certain Beneficial Owners" and "Common Stock Ownership by Directors and Executive Officers" in the Company's Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2014.

Equity Compensation Plan Information

				Number of
				Securities
				remaining
				available
	Number of			for future
	Securities		Weighted	issuance
	to be		Average	under equity
	issued upon		exercise	compensation
	exercise of		price of	plans
	outstanding		outstanding	(excluding
	options,		options,	securities
	warrants		warrants	reflected in
	and rights		and rights	column (a))
Plan Category	(a)		(b)	(c)
Equity compensation
plans approved by
security holders	326,830	$	25.43	486,590
Equity compensation
plans not approved
by security holders	0		0	0
Total	326,830	$	25.43	486,590

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Information required in response to this Item 13 is included under the caption “Related Party Transactions", “Corporate Governance”, and “Board Leadership Structure and Committee Membership” in the Company's Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2014.

42

Item 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Information required in response to this Item 14 is included under the captions “Independent Registered Public Accounting Firm” in the Company’s Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2014.

PART IV

Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

(a) (1) and (2) Financial Statements and Financial Statement Schedules.

The response to this item is submitted as a separate section. See Index to Financial Statements and Financial Statement Schedules on page 48 of this Form 10-K.

(3) Exhibits.

The response to this item is submitted as a separate section. See Exhibit Index on pages 45 through 47 of this Form 10-K.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		FRP Holdings, Inc.
Date:  December 3, 2014	By	THOMPSON S. BAKER II
		Thompson S. Baker II
		President and Chief Executive
		Officer (Principal Executive Officer)
	By	JOHN D. MILTON, JR.
		John D. Milton, Jr.
		Executive Vice President, Treasurer,
		Secretary and Chief Financial Officer
		(Principal Financial Officer)
	By	JOHN D. KLOPFENSTEIN
		John D. Klopfenstein
		Controller and Chief Accounting
		Officer (Principal Accounting Officer)

43

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on December 3, 2014.

THOMPSON S. BAKER II	CHARLES E. COMMANDER III
Thompson S. Baker II	Charles E. Commader III
President and Chief	Director
Executive Officer
(Principal Executive Officer)
	LUKE E. FICHTHORN III
	Luke E. Fichthorn III
JOHN D. MILTON, JR.	Director
John D. Milton, Jr.
Executive Vice President, Treasurer,
Secretary and Chief Financial	ROBERT H. PAUL III
Officer (Principal Financial Officer)	Robert H. Paul III
	Director
JOHN D. KLOPFENSTEIN
John D. Klopfenstein	H. W. SHAD III
Controller and Chief Accounting	H. W. Shad III
Officer (Principal Accounting Officer)	Director
JOHN D. BAKER II	MARTIN E. STEIN, JR.
John D. Baker II	Martin E. Stein, Jr.
Executive Chairman	Director
JOHN E. ANDERSON	JAMES H. WINSTON
John E. Anderson	James H. Winston
Director	Director
EDWARD L. BAKER
Edward L. Baker
Director, Chairman Emeritus

44

 FRP HOLDINGS, INC.

FORM 10-K FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014

EXHIBIT INDEX

[Item 14(a)(3)]

(3)(a)(1)	Articles of Incorporation of FRP Holdings, Inc., incorporated by reference to the corresponding exhibit filed with Form S-4 dated December 13, 1988. File No. 33-26115.
(3)(a)(2)	Amendment to the Articles of Incorporation of FRP Holdings, Inc. filed with the Secretary of State of Florida on February 19, 1991 incorporated by reference to the corresponding exhibit filed with Form 10-K for the fiscal year ended September 30, 1993. File No. 33-26115.
(3)(a)(3)	Amendments to the Articles of Incorporation of FRP Holdings, Inc. filed with the Secretary of State of Florida on February 7, 1995, incorporated by reference to an appendix to the Company’s Proxy Statement dated December 15, 1994. File No. 33-26115.
(3)(a)(4)	Amendment to the Articles of Incorporation of FRP Holdings, Inc., filed with the Florida Secretary of State on May 6, 1999 incorporated by reference to a form of such amendment filed as Exhibit 4 to the Company’s Form 8-K dated May 5, 1999. File No. 33-26115.

(3)(a)(5)	Amendment to the Articles of Incorporation of FRP Holdings, Inc. filed with the Secretary of State of Florida on February 21, 2000, incorporated by reference to the corresponding exhibit filed with Form 10-Q for the quarter ended March 31, 2000. File No. 33-26115.
(3)(b)(1)	Amended and Restated Bylaws of FRP Holdings, Inc. adopted August 3, 2005, incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K dated August 3, 2005. File No. 33-26115.
(4)(a)	Articles III, VII and XII of the Articles of Incorporation of Patriot Transportation Holding, Inc, incorporated by reference to an exhibit filed with Form S-4 dated December 13, 1988. And amended Article III, incorporated by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 1993. And Articles XIII and XIV, incorporated by reference to an appendix filed with the Company’s Proxy Statement dated December 15, 1994. File No. 33-26115.
(4)(b)	Specimen stock certificate of Patriot Transportation Holding, Inc, incorporated by reference to an exhibit filed with Form S-4 dated December 13, 1988. File No. 33-26115.
(10)(a)	Various lease backs and mining royalty agreements with Florida Rock Industries, Inc., none of which are presently believed to be material individually, except for the Mining Lease Agreement dated September 1, 1986, between Florida Rock Industries Inc. and Florida Rock Properties, Inc., successor by merger to Grandin Land, Inc. (see Exhibit (10)(c)), but all of which may be material in the aggregate, incorporated by reference to an exhibit filed with Form S-4 dated December 13, 1988. File No. 33-26115.
(10)(b)	License Agreement, dated June 30, 1986, from Florida Rock Industries, Inc. to Florida Rock & Tank Lines, Inc. to use "Florida Rock" in corporate names, incorporated by reference to an exhibit filed with Form S-4 dated December 13, 1988. File No. 33-26115.

45

(10)(c)	Mining Lease Agreement, dated September 1, 1986, between Florida Rock Industries, Inc. and Florida Rock Properties, Inc., successor by merger to Grandin Land, Inc., incorporated by reference to an exhibit previously filed with Form S-4 dated December 13, 1988. File No. 33-26115.
(10)(d)	Summary of Medical Reimbursement Plan of FRP Holdings, Inc., incorporated by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 1993. File No. 33-26115.
(10)(e)	Summary of Management Incentive Compensation Plans, incorporated by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 1994. File No. 33-26115.
(10)(f)	Management Security Agreements between the Company and certain officers, incorporated by reference to a form of agreement previously filed (as Exhibit (10)(I)) with Form S-4 dated December 13, 1988. File No. 33-26115.
(10)(g)(1)	FRP Holdings, Inc. 2000 Stock Option Plan, incorporated by reference to an appendix to the Company’s Proxy Statement dated December 15, 1999. File No. 33-26115.
(10)(g)(2)	FRP Holdings, Inc. 2006 Stock Incentive Plan, incorporated by reference to an appendix to the Company’s Proxy Statement dated December 29, 2005. File No. 33-26115.
(10)(h)	Amended and Restated Revolving Credit Agreement dated September 30, 2008 among FRP Holdings, Inc. as Borrower, the Lenders from time to time party hereto and Wachovia Bank, National Association as Administrative Agent, incorporated by reference to the Company’s Form 8-K dated October 7, 2008. File No. 33-26115.
(10)(i)	The Company and its consolidated subsidiaries have other long-term debt agreements, none of which exceed 10% of the total consolidated assets of the Company and its subsidiaries, and the Company agrees to furnish copies of such agreements and constituent documents to the Commission upon request.
(10)(k)	Joint Venture Agreement between Florida Rock Industries, Inc. and Florida Rock Properties, incorporated by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 2006. File No. 33-26115.
(10)(l)	Letter Agreement between the Company and David H. deVilliers, Jr., incorporated by reference to an exhibit filed with Form 10-Q for the quarter ended December 31, 2007. File No. 33-26115.
(10)(m)	Letter Agreement between the Company and Robert E. Sandlin, incorporated by reference to an exhibit filed with Form 10-Q for the quarter ended December 31, 2007. File No. 33-26115.
(10)(n)	Letter Agreement between the Company and John D. Klopfenstein, incorporated by reference to an exhibit filed with Form 10-Q for the quarter ended December 31, 2007. File No. 33-26115.

46

(10)(s)	Limited Liability Company Agreement of Riverfront Investment Partners I LLC. Between FRP Riverfront I LLC and MRP SE Waterfront Residential LLC. incorporated by reference to an exhibit filed with Form 10-Q for the quarter ended June 30, 2013. File No. 33-26115.
(13)	The Company's 2014 Annual Report to shareholders, portions of which are incorporated by reference in this Form 10-K. Those portions of the 2014 Annual Report to Shareholders which are not incorporated by reference shall not be deemed to be filed as part of this Form 10-K.
(14)	Financial Code of Ethical Conduct between the Company, Chief Executive Officers and Financial Managers, adopted December 4, 2002, incorporated by reference to an exhibit filed with Form 10-K for the year ended September 30, 2003. File No. 33-26115.
(21)	Subsidiaries of Registrant at September 30, 2014: Florida Rock & Tank Lines, Inc. (a Florida corporation); Florida Rock Properties, Inc. (a Florida corporation); FRP Development Corp. (a Maryland corporation); FRP Maryland, Inc. (a Maryland corporation); 34 Loveton Center LLC (a Maryland limited liability company); FRTL, Inc. (a Florida corporation); SunBelt Transport, Inc. (a Florida corporation); Oz LLC(a Maryland limited liability company); 1502 Quarry, LLC(a Maryland limited liability company); FRP Lakeside LLC #1 (a Maryland limited company); FRP Lakeside LLC #2 (a Maryland limited liability company); FRP Lakeside LLC #3 (a Maryland limited liability company); FRP Lakeside LLC #4 (a Maryland limited liability company); FRP Lakeside LLC #5 (a Maryland limited liability company); FRP Hillside LLC (a Maryland limited liability company); FRP Hillside LLC #2 (a Maryland limited liability company); FRP Hillside LLC #3 (a Maryland limited liability company); FRP Hillside LLC #4 (a Maryland limited liability company); FRP Windsor LLC (a Maryland limited liability company); FRP Dorsey LLC (a Maryland limited liability company); FRP Bird River LLC (a Maryland limited liability company); FRP Interchange LLC (a Maryland limited liability company); FRP Azalea LLC (a Maryland limited liability company); FRP Manassas LLC (a Maryland limited liability company); FRP Hampstead LLC (a Maryland limited liability company); FRP Hollander 95 LLC (a Maryland limited liability company); FRP Transit Business Park (a Maryland limited liability company); FRP Kelso LLC (a Maryland limited liability company); New Patriot Transportation Holding, Inc. (a Florida corporation).
(23)(a)	Consent of Hancock Askew & Co., Inc., Independent Registered Certified Public Accounting Firm, appears on page 49 of this Form 10-K.
(31)(a)	Certification of Thompson S. Baker II.
(31)(b)	Certification of Thompson S. Baker II.
(31)(c)	Certification of John D. Klopfenstein.
(32)	Certification of Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer under Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.XSD	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

47

FRP HOLDINGS, INC.

INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

(Item 15(a) (1) and 2))

	Page
Consolidated Financial Statements:
Consolidated balance sheets at September 30, 2014
and 2013	19	(a)
For the years ended September 30, 2014, 2013 and 2012:
Consolidated statements of income	18	(a)
Consolidated statements of comprehensive income	18	(a)
Consolidated statements of cash flows	20	(a)
Consolidated statements of shareholders' equity	21	(a)
Notes to consolidated financial statements	22-33	(a)
Report of Independent Registered Certified Public
Accounting Firm	34-35	(a)
Selected quarterly financial data (unaudited)	7	(a)
Consent of Independent Registered Certified Public
Accounting Firm	49	(b)
Report of Independent Registered Certified Public
Accounting Firm on Financial Statement Schedules	49	(b)
Consolidated Financial Statement Schedules:
II - Valuation and qualifying accounts	50	(b)
III - Real estate and accumulated depreciation and
Depletion	51-52	(b)
(a)         Refers to the page number in the Company's 2014 Annual Report             to Shareholders.  Such information is incorporated by             reference in Item 8 of this Form 10-K.
(b)         Refers to the page number in this Form 10-K
All other schedules have been omitted, as they are not required under the related instructions, are inapplicable, or because the information required is included in the consolidated financial statements.

48

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-55132, 333-125099 and 333-131475) of FRP Holdings, Inc. of our report dated December 3, 2014 relating to the consolidated financial statements and the effectiveness of FRP Holdings, Inc’s internal control over financial reporting which appears in the Annual Report to Shareholders incorporated by reference herein. We also consent to the incorporation by reference of our report dated December 3, 2014, relating to the financial statement schedules, which appear in this Form 10-K.

Hancock Askew & Co., LLP

Savannah, Georgia

December 3, 2014

REPORT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM ON FINANCIAL STATEMENT SCHEDULES

To the Board of Directors of

FRP Holdings, Inc.:

Our audit of the consolidated financial statements referred to in our report dated December 3, 2014 appearing in the 2014 Annual Report to Shareholders of FRP Holdings, Inc. (which report and consolidated financial statements are incorporated by reference in this Annual Report on Form 10-K) also included an audit of the financial statement schedules listed in Item 15(a)(2) of this Form 10-K. These financial statement schedules are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statement schedules based on our audit. In our opinion, these financial statement schedules present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements.

Hancock Askew & Co., LLP

Savannah, Georgia

December 3, 2014

49

FRP HOLDINGS, INC.

SCHEDULE II (CONSOLIDATED) - VALUATION

AND QUALIFYING ACCOUNTS

YEARS ENDED SEPTEMBER 30, 2014, 2013 AND 2012

				ADDITIONS			ADDITIONS
		BALANCE		CHARGED TO			CHARGED TO						BALANCE
		AT BEGIN.		COST AND			OTHER						AT END
		OF YEAR		EXPENSES			ACCOUNTS			DEDUCTIONS			OF YEAR
Year Ended
September 30, 2014:
Allowance for
doubtful accounts	$	161,934	$	52,083		$	—		$	58,541	(a)	$	155,476
Accrued risk
Insurance:
Tanklines	$	1,536,758	$	3,165,528		$	—		$	3,151,031		$	1,551,255
Accrued health
Insurance		898,127		3,899,037			3,589	(c)		3,764,534	(b)		1,036,219
Totals -
Insurance	$	2,434,885	$	7,064,565		$	3,589		$	6,915,565		$	2,587,474
Year Ended
September 30, 2013:
Allowance for
doubtful accounts	$	128,604	$	40,184		$	—		$	6,854	(a)	$	161,934
Accrued risk
Insurance:
Tanklines	$	3,670,950	$	1,919,650		$	—		$	4,053,842		$	1,536,758
Accrued health
Insurance		1,248,517		2,211,550			—	(c)		2,561,940	(b)		898,127
Totals -
Insurance	$	4,919,467	$	4,131,200		$	—		$	6,615,782		$	2,434,885
Year Ended
September 30, 2012:
Allowance for
doubtful accounts	$	117,927	$	41,435		$	—		$	30,758	(a)	$	128,604
Accrued risk
Insurance:
Tanklines	$	4,879,799	$	1,735,033		$	—		$	2,943,882		$	3,670,950
Sunbelt		29,518		(151,505	)		—			(121,987	)		—
Accrued health
insurance		989,298		2,864,681			10,592	(c)		2,616,054	(b)		1,248,517
Totals -
insurance	$	5,898,615	$	4,448,209		$	10,592		$	5,437,949		$	4,919,467

Note: SunBelt’s risk insurance expense for the year ended September 30, 2012 was negative due to claims settled for less than prior estimates.

(a) Accounts written off less recoveries

(b) Payments

(c) Other comprehensive income (ASC Topic 715).

50

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED)-REAL ESTATE & ACCUMULATED DEPRECIATION AND

DEPLETION (dollars in thousands)

SEPTEMBER 30, 2014

County	Encumb- rances		Initial cost to Company		Cost capi- talized subsequent to acqui- sition			Gross amount at which carried at end of period (a)		Accumulated Depreciation & Depletion		Year Of Constr- uction		Date Acquired	Deprecia- tion Life Computed on:
Construction Aggregates
Alachua, FL			$	1,442	$	0		$	1,442	$	142		n/a	4/86	unit
Clayton, GA				369		0			369		5		n/a	4/86	unit
Fayette, GA				685		0			685		64		n/a	4/86	unit
Lake, FL				402		0			402		146		n/a	4/86	unit
Lake Louisa, FL				11,039		0			11,039		0		n/a	5/12	unit
Lee, FL				4,690		6			4,696		6		n/a	4/86	unit
Monroe, GA				792		0			792		283		n/a	4/86	unit
Muscogee, GA				369		(45	)		324		313		n/a	4/86	unit
Prince Wil., VA				299		0			299		299		n/a	4/86	unit
Putnam, FL				15,002		37			15,039		4,375		n/a	4/86	unit
		0		35,089		(2	)		35,087		5,633
Other Rental Property
Wash D.C.				2,957		10,307			13,264		2,547		n/a	4/86	15 yr.
Wash D.C.				3,811		0			3,811		0		n/a	10/97	n/a
Putnam, FL				302		(2	)		300		283		n/a	4/86	5 yr.
Spalding, GA				20		0			20		0		n/a	4/86	n/a
Lake, FL				1,083		0			1,083		968		n/a	4/86	unit
Marion, FL				1,180		4			1,184		599		n/a	4/86	unit
		0		9,353		10,309			19,662		4,397
Commercial Property
Baltimore, MD		1,912		439		4,662			5,101		2,650		1990	10/89	39 yr.
Baltimore, MD		3,909		950		7,324			8,274		4,389		1994	12/91	39 yr.
Baltimore, MD		1,329		690		2,861			3,551		1,436		2000	07/99	39 yr.
Baltimore, MD		0		5,634		11,504			17,138		810		2008	12/02	39 yr.
Baltimore, MD		0		4,309		218			4,527		38		n/a	06/14	39 yr.
Baltimore City, MD		0		5,750		5,609			11,359		678		2010	12/10	39 yr.
Baltimore City, MD		0		7,442		834			8,276		396		n/a	6/13	39 yr.
Duval, FL		0		2,416		541			2,957		2,752		n/a	4/86	25 yr.
Harford, MD		974		31		3,830			3,861		2,009		1998	8/95	39 yr.
Harford, MD		2,088		50		5,699			5,749		2,377		1999	8/95	39 yr.
Harford, MD		3,433		85		7,091			7,176		3,345		2001	8/95	39 yr.
Harford, MD		0		92		1,509			1,601		0		n/a	8/95	39 yr.
Harford, MD		2,645		88		10,133			10,221		3,819		2007	8/95	39 yr.
Harford, MD		1,954		155		12,337			12,492		3,605		2009	8/95	39 yr.
Howard, MD		1,272		2,859		4,778			7,637		4,010		1996	9/88	39 yr.
Howard, MD		1,201		2,473		981			3,454		1,327		2000	3/00	39 yr.
Anne Arun, MD		0		715		9,211			9,926		5,365		1989	9/88	39 yr.
Anne Arun, MD		6,546		950		13,120			14,070		4,484		2003	5/98	39 yr.
Anne Arun, MD		0		1,525		10,800			12,325		3,088		2005	8/04	39 yr.
Anne Arun, MD		3,816		737		5,341			6,078		1,521		2006	1/03	39 yr.
Anne Arun, MD		0		667		10,259			10,926		2,001		2012	7/07	39 yr.
Norfolk, VA		5,305		7,512		0			7,512		2,224		2004	10/04	39 yr.
Prince Wil., VA		0		7,324		27,508			34,832		690		n/a	12/05	39 yr.
Newcastle Co., DE		9,209		11,559		2,757			14,316		3,876		2004	4/04	39 yr.
Carroll, MD		0		4,720		2,315			7,035		0		n/a	3/08	n/a
		45,593		69,172		161,222			230,394		56,890
Investment Property				1,629		(101	)		1,528		678		n/a	4/86	n/a
GRAND TOTALS	$	45,593	$	115,243	$	171,428		$	286,671	$	67,598

(a) The aggregate cost for Federal income tax purposes is $252,925.

51

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED) - REAL ESTATE AND

ACCUMULATED DEPRECIATION AND DEPLETION

YEARS ENDED SEPTEMBER 30, 2014, 2013 AND 2012

 (In thousands)

		2014			2013			2012
Gross Carrying Cost of Real Estate:
Balance at beginning of period	$	268,932		$	262,564		$	241,253
Additions during period:
Amounts capitalized		19,154			22,228			21,380
Deductions during period:
Cost of real estate sold		(1,415	)		(10,021	)		(69	)
Other		—			(5,839	)		—
Balance at close of period	$	286,671		$	268,932		$	262,564
Accumulated Depreciation & Depletion:
Balance at beginning of period	$	62,167		$	58,997		$	54,110
Additions during period:
Charged to cost & expense		5,446			4,938			4,956
Deductions during period:
Real estate sold		(15	)		(461	)		(69	)
Other		—			(1,307	)		—
Balance at close of period	$	67,598		$	62,167		$	58,997

52

EX-13

Annual Report 2014

CONSOLIDATED FINANCIAL HIGHLIGHTS

Years ended September 30

(Amounts in thousands except per share amounts)

		2014	2013	% Change
Revenues	$	160,140	139,774	14.6
Operating profit	$	17,768	20,434	(13.0	)
Income before income taxes	$	16,671	25,222	(33.9	)
Net income	$	10,019	15,385	(34.9	)
Per common share:
Basic	$	1.04	1.62	(35.8	)
Diluted	$	1.03	1.60	(35.6	)
Total Assets	$	313,071	287,093	9.0
Total Debt	$	63,238	49,904	26.7
Shareholders' Equity	$	206,315	192,646	7.1
Common Shares Outstanding		9,703	9,564	1.5
Book Value Per Common Share	$	21.26	20.14	5.6

BUSINESS. The Company is engaged in the transportation and real estate businesses. The Company’s transportation business is conducted through a wholly owned subsidiary, Florida Rock & Tank Lines, Inc. (Tank Lines), which is a Southeastern U.S. based tank truck company concentrating in the hauling of primarily petroleum products and other liquids and dry bulk commodities. The Company’s real estate group, comprised of FRP Development Corp. and Florida Rock Properties, Inc., acquires, constructs, leases, operates and manages land and buildings to generate both current cash flows and long-term capital appreciation. The real estate group also owns real estate which is leased under mining royalty agreements or held for investment.

OBJECTIVES. The Company’s dual objectives are to continue building a substantial transportation company and a real estate company providing sound long-term growth, cash generation and asset appreciation.

TRANSPORTATION

Internal growth is accomplished by a dedicated and competent work force emphasizing superior service to customers in existing markets, developing new transportation services for customers in current market areas and expanding into new market areas.

External growth is designed to broaden the Company’s geographic market area and delivery services by acquiring related businesses.

REAL ESTATE

The growth plan is based on the acquisition, development and management of mining royalty lands and commercial warehouse/office rental properties located in appropriate sub-markets in order to provide long-term positive cash flows and capital appreciation.

53

To Our Shareholders

While our fiscal 2014 results were well below our expectations, due in large part to the underperformance of our transportation segment but also to significant costs related to the spin-off transaction, there were several bright spots throughout the year. The Developed Buildings and Land segment increased (i) the amount of square footage we own, (ii) our average percentage occupancy rate and (iii) its gross profit. This segment also completed construction of the 3rd build-to-suit at Patriot Business Park four months ahead of schedule and the tenant took occupancy on 12/1/2014. The Company, with its partner MRP, closed on $82M of financing for the construction of Phase I of the Anacostia on the Riverfront project, and commenced construction on the 305 unit, 9 story, class A apartment building. On May 7th, the Company’s Board of Directors approved moving forward with the spin-off of the Company’s transportation segment into a separately traded public company and we expect the transaction to be effective sometime in the 2nd quarter of fiscal 2015.

The Transportation Segment:

Our transportation segment experienced a very challenging year. The Pipeline acquisition proved to be much more difficult than we anticipated with a large percentage of the Pipeline drivers leaving employment with us shortly after the acquisition and the termination of a sizeable piece of Pipeline business that we expected to retain.

Additionally, the industry in general is experiencing one of the most severe driver shortages in memory. So, while we fully anticipated being able to service not only the business acquired in the Pipeline deal but also several new pieces of business we were awarded through the efforts of our sales team, we found ourselves scrambling to cover our business with drivers from our other locations at a significant loss to the Company. Additionally, due to the high turnover rate this year, we experienced a 22.4% increase in hiring and training costs in our attempt to get our driver count up to the levels we needed to fully provide our customers with the level of service they expect from our Company. Lastly, while our Preventable Accident Frequency Rate was very much in line with our expectations, the number of severe accidents was higher than in recent years and hit our bottom line results significantly as we are self-insured on those accidents to a certain degree.

However, our last quarter operating results in this segment (before year-end adjustments for actuarial items related to risk and health insurance, an MSP plan accrual and spin-off costs) were much more favorable and in-line with our expectations and we hope to continue that turnaround into 2015 and beyond.

On a high note, we did increase our revenue in this segment by 15% and increased our driver count from 631 at the end of fiscal 2013 to 683 at the end of fiscal 2014.

We will be focusing very hard in fiscal 2015 on our safety performance and finding efficient ways to hire, train and retain drivers in the markets where we need them.

Mining Royalty Land Segment:

For fiscal 2014, our mining royalty land segment was just slightly improved over fiscal 2013. However, the outlook for the construction sector still seems to be improving and we are hopeful that will translate into rising volumes and prices for construction materials in the coming years, both of which directly benefit the bottom line of this segment.

On a specific note, the Company executed a lease amendment with Vulcan Materials in relation to our mining property in Ft. Myers, Florida. We expect the amendment to expedite the timeframe for the collection of production royalties from this property and, more importantly, to provide approximately 105, 1 acre, waterfront residential lots following completion of mining (in the next 7-10 years) which we will market to the major homebuilders.

54

Developed Property Rentals Segment:

During fiscal 2014, our developed buildings segment (i) increased its rentable square feet by 195,230 sf, a 6% increase, through the completion of a second build to suit at Patriot Business Park and the acquisition of two existing buildings at Kelso Dr. in Baltimore, (ii) commenced and completed construction of a 3rd build to suit for the same tenant at Patriot Business Park (occupied on 12/1/2014), and (iii) increased its gross profit by 8.5%.

Once again, our Patriot Business Park was our most active property during fiscal 2014. We completed our second build-to-suit which was occupied in February, 2014 and commenced and completed construction of a third build to suit for the same tenant. We also sold approximately 4 acres of property that did not suit our typical building footprint to generate cash which we were able to 1031 exchange into the Kelso buildings (69,680 sf) we acquired in August of this year.

Our focus in this segment going forward will be to continue converting our non-income producing land into income producing properties and to seek opportunities to grow our portfolio through select acquisitions that our management team will look to uncover.

Anacostia:

The commencement of construction on our Anacostia Riverfront project is something our shareholders have been patiently awaiting for many years. During the fiscal year, financing was secured for this project on what the Company deems to be favorable and flexible terms and construction officially commenced in October, 2014. There will be an official groundbreaking on December 9, 2014 hosted by the Company and our partners, MRP.

While there has been significant building in the apartment market in the DC area over the past few years, particularly the Riverfront submarket, we are cautiously optimistic that delivery of our project in late 2016 will result in favorable rents and a timely lease up schedule. Phases 2, 3 and 4 are now on the horizon as well and we expect to be very busy with this project for years to come.

Spin-Off:

On May 7, 2014, the company announced that it was moving forward with a tax-free spin-off of our transportation segment. We have spent a considerable amount of time and money in fiscal 2014 working through that process. We are confident that the end is near and expect the transaction to be effective in the 2nd quarter of fiscal 2015. We believe this transaction will provide significant opportunities to grow both our real estate and transportation business and that will be our focus in 2015 and beyond.

Again, while 2014 was not a stellar year by any means for the Company, we will note that fiscal 2014 generated a $13.8 million increase in shareholder equity. As always, we do not take lightly your continuing investment in our Company and look forward to continuing to grow these businesses in fiscal 2015. Thank you for your loyalty and support.

Respectively yours,

John D. Baker II

Executive Chairman

Thompson S. Baker II

President & Chief Executive Officer

55

OPERATING PROPERTIES

Transportation. Our transportation subsidiary, Florida Rock & Tank Lines, Inc. (Tank Lines), is a regional tank truck carrier specializing in hauling petroleum products, chemicals and dry bulk commodities. As of September 30, 2014, Tank Lines employed 683 revenue-producing drivers and operated 21 terminals in Florida, Georgia, Alabama, Tennessee, North Carolina and South Carolina.

At September 30, 2014 the transportation segment operated a fleet of 486 tractors and 588 tank trailers plus 7 additional trucks that were being prepared for sale. The Company owns all of the tank trailers and owns all of the tractors except for 47 leased tractors that were acquired from Pipeline Transportation and 3 tractors owned by owner-operators. During fiscal 2014, the transportation segment purchased 77 new tractors and 9 trailers, plus 11 tractors and 67 trailers acquired from Pipeline Transportation, Inc. in November 2013. In fiscal 2012 and 2013, the Company purchased 161 new tractors. The fiscal 2015 capital budget includes 75 new tractors and 27 new trailers including binding commitments to purchase 20 tractors and 5 trailers at September 30, 2014. We are replacing a larger than average number of tractors purchased prior to 2007 engine changes required by the EPA. We anticipate this more modern fleet will result in reduced maintenance expenses, improved operating efficiencies and enhanced driver recruitment and retention.

The Company’s transportation segment acquired certain assets of Pipeline Transportation, Inc. on November 7, 2013. Pipeline’s operations have been conducted in the Florida and Alabama markets also served by Florida Rock and Tank Lines, Inc. For the twelve month period ending June 30, 2013, Pipeline had gross revenues of just over $16,500,000.

Mining Royalty Land. The mining royalty land segment owns and seeks to acquire land with construction aggregates deposits, a substantial portion of which is leased to Vulcan Materials Company under long-term mining royalty agreements, whereby the Company is paid a percentage of the revenues generated or annual minimums. The segment also owns mining related land held for future appreciation or development. In May 2012 the Company acquired approximately 1,200 acres near Lake Louisa, Florida which is west of Orlando, Florida for a purchase price of $11 million. The Company simultaneously executed a long-term royalty lease under which it receives a minimum monthly royalty payment until the tenant receives the necessary permits and begins mining sand. At September 30, 2014, the mining royalty land segment owned the following properties:

1) Locations currently being mined on a total of 10,423 acres in Grandin, Keuka and Newberry, Florida, Columbus, Macon and Tyrone, Georgia and Manassas, Virginia. Tons sold in 2014 totaled 4,575,000 leaving estimated reserves of 332,680,000 tons.

2) Locations under royalty agreements but not currently being mined on a total of 4,771 acres in Ft. Myers, Airgrove/Lake County, Marion County, Astatula/Lake County, and Lake Louisa, Florida, and Forest Park Georgia. Tons sold in 2014 totaled 1,000 leaving estimated reserves of 96,330,000 tons.

The Ft. Myers residential property in Lee County, Florida is part of a 1,993 acre site under a long-term mining lease to Vulcan. In June, 2010 the Company entered into a letter agreement with Vulcan Materials Company that required modifications to the existing mining lease on our property, such that the mining will be accelerated and the mining plan will be revised to accommodate future construction of up to 105 residential dwelling units around the mined

56

lakes. In return the Company agreed to grant Lee County a right of way for a road and to place a conservation easement on part of the property.

3) The segment owns 1,923 acres of investment properties in Gulf Hammock, Brooksville, Palatka, and Polk County, Florida and Yatesville and Henderson, Georgia.

4) Brooksville Quarry LLC. On October 4, 2006, a subsidiary of the Company (FRP) entered into a Joint Venture Agreement with Vulcan Materials Company (formerly Florida Rock Industries, Inc.) to form Brooksville Quarry, LLC, a real estate joint venture to develop approximately 4,300 acres of land near Brooksville, Florida. 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 in August 2012.

Developed Property Rentals. The developed property rentals segment acquires, constructs, leases and manages land and commercial buildings in the Baltimore/Northern Virginia/Washington and Jacksonville, Florida areas.

At September 30, 2014, the developed property rentals segment owned 407 acres in 16 developed parcels of land all but one of which are in the Mid-Atlantic region of the United States as follows:

1) Hillside Business Park in Anne Arundel County, Maryland consists of 49 usable acres. Four warehouse/office buildings and one suburban office building totaling 567,473 square feet exist on the property and are 96% occupied.

2) Lakeside Business Park in Harford County, Maryland consists of 84 usable acres. Nine warehouse/office buildings totaling 893,722 square feet exist on 64 of these acres and are 89% occupied. The remaining 20 acres are available for future development and have the potential to offer an additional 266,530 square feet of comparable product.

3) 6920 Tudsbury Road in Baltimore County, Maryland contains 5.3 acres with 86,100 square feet of warehouse/office space that is 100% occupied by a single tenant.

4) 8620 Dorsey Run Road in Howard County, Maryland contains 5.8 acres with 85,100 square feet of warehouse/office space that is 100% occupied.

5) Rossville Business Center in Baltimore County, Maryland contains approximately 10 acres with 190,517 square feet of warehouse/office space and is 100% occupied.

6) 34 Loveton Circle in suburban Baltimore County, Maryland contains 8.5 acres with 33,708 square feet of office space, which is 81% occupied including 24% of the space occupied by the Company.

7) Oregon Business Center in Anne Arundel County, Maryland contains approximately 17 acres with 195,615 square feet of warehouse/office space, which is 83% occupied.

8) Arundel Business Center in Howard County, Maryland contains approximately 11 acres with 162,796 square feet of warehouse/office space, which is 100% occupied.

9) 100-400 Interchange Boulevard in New Castle County, Delaware contains approximately 17 acres with 303,006 square feet of warehouse/office space, which is 60% occupied. Chrysler and General Motors plant closings in 2008 continued to keep a reduced demand for space in this market. The remaining 8.8 acres are available for excess trailer storage or an additional 93,600 square feet of

57

comparable product.

10) 1187 Azalea Garden Road in Norfolk, Virginia contains approximately 12 acres with 188,093 square feet of warehouse/office space, which is 100% occupied.

11) Windlass Run Business Park in Baltimore County, Maryland contains 69,474 square feet of warehouse/office space on 4.7 acres that is currently 100% occupied. An additional 26 acres (excluding wetlands) of fully developed land is available with the potential to offer 386,626 square feet of warehouse, office, flex and retail buildings.

12) 155 E. 21^st Street in Duval County, Florida contains approximately 6 acres with 68,757 square feet of office space which is 100% leased to Vulcan.

13) Hollander 95 Business Park in Baltimore City, Maryland contains 82,800 square feet of warehouse/office space on 3.8 acres which is 100% leased. An additional 38 acres of partially developed land is available with the potential to offer 425,750 square feet of warehouse, office, hotel and flex buildings.

14) Patriot Business Park in Prince William County, Maryland contains 243,150 square feet of office space on 18 acres which is 100% occupied. The Company entered into a build to suit lease for a 129,850 square foot building situated on 8 acres which is estimated to commence first quarter of fiscal 2015. The remaining 24 acres have the potential to offer an additional 198,150 square feet of comparable product.

15) Transit Business Park in Baltimore, Maryland contains five buildings totaling 232,318 square feet on 14.5 acres and is 66.4% occupied.

16) Kelso Business Park in Baltimore County, Maryland, purchased on June 6, 2014, consists of two buildings on 10.2 acres totaling 69,680 square feet and is 100% occupied.

Additionally at September 30, 2014 the developed property rentals segment owned the following parcels held for future development or appreciation:

1) Windlass Run Residential (previously Bird River) phase 2, located in southeastern Baltimore County, Maryland, is a 74 acre tract of land adjacent to our Windlass Run Business Park. In September 2012, the Company received a non-binding letter of intent to sell the property for $18.8 million in two phases. The letter of intent to sell the property was converted into 2 executed contracts that expired during the due diligence period. The Company executed two contracts on April 17, 2013 with another buyer for the sale of phase 1 of the property in the quarter ending September 30, 2013 for $8.0 million and the balance for $11.0 million approximately 18 months later. The sale of phase 1 was completed in August of 2013 and resulted in a gain of $4,928,000. The sale of phase two is scheduled to close in March of 2015 and would generate a gain of approximately $6.0 million.

2) Anacostia River. The Company owns a 5.8 acre parcel of undeveloped real estate in Washington D.C. that fronts the Anacostia River and is adjacent to the Washington Nationals Baseball Park. The parcel was leased to a subsidiary of Vulcan Materials Company from 1986 through August 2011. In September 2011 Vulcan commenced a long term lease for a Company owned 2.1 acre tract which is nearby on the same bank of the Anacostia River. The approved planned unit development for the 5.8 acre parcel permits the Company to develop a four building, mixed use project, containing approximately 545,800 square feet of office and retail space and approximately 569,600 square feet of additional space for residential and hotel uses. The approved development would include

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numerous publicly accessible open spaces and a waterfront esplanade along the Anacostia River.

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 a portion 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 scheduled in 2016 and 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.

3) Leister property in Hampstead, Carroll County, Maryland is a 117 acre parcel located adjacent to State Route 30 bypass. The parcel is currently zoned for industrial use. Alternative uses are being investigated in order to maximize this assets’ profitability and expedite its disposition.

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Real Estate Group Property Summary Schedule at September 30, 2014 (dollars in thousands)

		Encumb-		Gross		Net	Date		Revenue
County		rances		Book Cost		Book Value	Acquired		Fiscal 2014
Mining Royalty Land
Alachua, FL			$	1,442	$	1,300	4/86	$	497
Clayton, GA				369		364	4/86		92
Fayette, GA				685		621	4/86		300
Lake, FL				402		256	4/86		69
Lake, FL				1,083		115	4/86		132
Lake Louisa, FL				11,039		11,039	5/12		783
Lee, FL				4,696		4,690	4/86		433
Monroe, GA				792		509	4/86		559
Muscogee, GA				324		11	4/86		274
Prince Wil. VA				299		0	4/86		318
Putnam, FL				15,039		10,664	4/86		1,513
Putnam, FL				300		17	4/86		0
Spalding, GA				20		20	4/86		5
Marion, FL				1,184		585	4/86		132
Investment Property				1,528		850	4/86		15
Brooksville Joint Venture				7,506		7,506	4/86		227
		0		46,708		38,547			5,349
Developed Property Rentals
Baltimore, MD		1,912		5,101		2,451	10/89		460
Baltimore, MD		3,909		8,274		3,885	12/91		1,302
Baltimore, MD		1,329		3,551		2,115	7/99		538
Baltimore, MD		0		17,138		16,328	12/02		468
Baltimore, MD		0		4,527		4,489	6/14		212
Baltimore City, MD		0		11,359		10,681	12/10		600
Baltimore City, MD		0		8,276		7,880	6/13		1,096
Duval, FL		0		2,957		205	4/86		730
Harford, MD		974		3,861		1,852	8/95		764
Harford, MD		2,088		5,749		3,372	8/95		1,236
Harford, MD		3,433		7,176		3,831	8/95		1,459
Harford, MD		0		1,601		1,601	8/95		0
Harford, MD		2,645		10,221		6,402	8/95		1,795
Harford, MD		1,954		12,492		8,887	8/95		1,265
Howard, MD		1,272		7,637		3,627	9/88		1,248
Howard, MD		1,201		3,454		2,127	3/00		582
Anne Arun, MD		0		9,926		4,561	9/88		1,117
Anne Arun, MD		6,546		14,070		9,586	5/98		2,193
Anne Arun, MD		0		12,325		9,237	8/04		1,843
Anne Arun, MD		3,816		6,078		4,557	1/03		702
Anne Arun, MD		0		10,926		8,925	7/07		1,382
Norfolk, VA		5,305		7,512		5,288	10/04		826
Prince Wil. VA		0		34,832		34,142	12/05		2,270
Newcastle Co. DE		9,209		14,316		10,440	4/04		736
Carroll, MD		0		7,035		7,035	3/08		0
Wash D.C.		0		13,264		10,717	4/86		0
Wash D.C.		0		3,811		3,811	10/97		805
		45,593		247,469		188,032			25,629
Grand Totals	$	45,593	$	294,177	$	226,579		$	30,978

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Five Year Summary-Years ended September 30

(Amounts in thousands except per share amounts)

		2014	2013	2012	2011	2010
Summary of Operations:
Revenues	$	160,140	139,774	127,514	120,106	111,338
Operating profit	$	17,768	20,434	14,101	14,369	14,503
Interest expense	$	1,475	2,520	2,638	3,346	3,928
Income from continuing
Operations	$	10,019	15,385	7,711	6,989	7,056
Per Common Share:
Basic	$	1.04	1.62	.82	.75	.77
Diluted	$	1.03	1.60	.81	.74	.75
Discontinued
Operations, net	$	—	—	97	5,222	315
Net income	$	10,019	15,385	7,808	12,211	7,371
Per Common Share:
Basic	$	1.04	1.62	.83	1.32	.80
Diluted	$	1.03	1.60	.82	1.29	.78
Financial Summary:
Current assets	$	20,044	17,017	26,919	34,694	31,772
Current liabilities	$	21,927	20,982	20,165	18,232	18,095
Property and
equipment, net	$	249,610	241,413	228,021	208,988	198,116
Total assets	$	313,071	287,093	275,705	266,390	257,712
Long-term debt	$	58,704	45,593	57,131	62,370	67,272
Shareholders' equity	$	206,315	192,646	174,718	164,447	152,056
Net Book Value
Per common share	$	21.26	20.14	18.51	17.71	16.39
Other Data:
Weighted average common
shares - basic		9,629	9,523	9,360	9,284	9,182
Weighted average common
shares - diluted		9,710	9,605	9,474	9,451	9,424
Number of employees		957	886	828	802	763
Shareholders of record		469	497	505	497	509

Quarterly Results (unaudited)

(Dollars in thousands except per share amounts)

		First		Second		Third		Fourth
		2014	2013	2014	2013	2014	2013	2014	2013
Revenues	$	38,820	33,057	39,907	33,868	41,248	35,708	40,165	37,141
Operating profit	$	4,124	4,408	3,146	4,308	5,730	6,070	4,768	5,648
Net income	$	2,341	3,123	1,703	2,271	3,485	3,002	2,490	6,989
Earnings per common share (a):
Net income-
Basic	$	.24	.33	.18	.24	.36	.31	.26	.73
Diluted	$	.24	.33	.18	.24	.36	.31	.26	.72
Market price per common share (b):
High	$	42.76	28.76	40.87	29.84	37.30	30.44	36.92	36.19
Low	$	33.56	23.25	35.14	24.81	31.20	26.56	33.26	30.00

(a) Earnings per share of common stock is computed independently for each quarter presented. The sum of the quarterly net earnings per share of common

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stock for a year may not equal the total for the year due to rounding differences.

(b) All prices represent high and low daily closing prices as reported by The Nasdaq Stock Market.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Executive Overview

FRP Holdings, Inc. (the Company) is a holding company engaged in the transportation and real estate businesses.

The Company’s transportation business, Florida Rock & Tank Lines, Inc. is engaged in hauling primarily petroleum and other liquids and dry bulk commodities in tank trailers.

The Company’s real estate business is operated through two subsidiaries: Florida Rock Properties, Inc. and FRP Development Corp. The Company owns real estate in Florida, Georgia, Virginia, Maryland, Delaware and Washington, D.C. The Company’s real estate operations consist of two reportable segments. The Mining royalty land segment owns real estate including construction aggregate royalty sites and parcels held for investment. The Developed property rentals segment acquires, constructs, leases, and manages office/warehouse buildings primarily in the Baltimore/Northern Virginia/Washington area and holds real estate for future development or related to its developments.

In May 2014, we announced a plan to separate our transportation and real estate businesses through a tax-free spin-off of the transportation group. In order to facilitate the spin-off, we completed an internal corporate reorganization in December 2014 in which your shares of Patriot common stock were converted into an equal number of shares of common stock of our newly publicly traded holding company, FRP Holdings, Inc. For more information on the spin-off, see Item 1 “Business” of our Annual Report on Form 10-K.

Financial Highlights Fiscal 2014

• Net income declined 35% in fiscal 2014 to $10,019,000, or $1.03 per diluted share, from $15,385,000, or $1.60 per diluted share in fiscal 2013.

• Although revenues for the Transportation segment were up 15.2% year over year, operating profit decreased $3,048,000 or 32.6% due to lower revenue per mile, $3,185,000 higher insurance and claims, a $295,000 increase in out-of-town driver pay, a $452,000 increase in driver travel and housing costs for out-of-town drivers, a $575,000 accrual under the Management Security Plan due to the death prior to retirement of one of the Plan participants, write-offs of $355,000 on equipment due to accidents and $346,000 for allocation of 50% of spin-off costs partially offset by reduced bonus compensation of $1,717,000.

• Revenues for the Developed Properties rental segment were up 14.7% due to occupancy of recently acquired or completed buildings and improved average occupancy. Gains on investment land sold were $6,857,000 lower than fiscal 2013.

• Interest expense was down due to prepayment of mortgage debt in the prior year.

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Transportation. Our transportation subsidiary is a regional tank truck carrier specializing in hauling petroleum products and liquid and dry bulk commodities. Approximately 82% of our business consists of hauling petroleum products to convenience stores, truck stops and fuel depots. The remaining 18% of our business consists of hauling dry bulk commodities such as cement, lime and various industrial powder products and liquid chemicals. As of September 30, 2014, we employed 683 revenue-producing drivers who operate our fleet of 486 tractors and 588 trailers from our 21 terminals and 9 satellite locations in Florida, Georgia, Alabama, South Carolina, North Carolina and Tennessee.

Our industry is characterized by such barriers to entry as the time and cost required to develop the capabilities necessary to handle hazardous material, the resources required to recruit and train drivers, substantial industry regulatory and insurance requirements and the significant capital investments required to build a fleet of equipment and establish a network of terminals. Our industry experiences increased seasonal demand in periods of heightened driving activity in our markets.

Our ability to provide superior customer service at competitive rates and to operate safely and efficiently is important to our success in growing our revenues and increasing profitability. Our fundamental strategy is to increase business with our existing customers, particularly hypermarket and large convenience store chains, expand our service offerings and pursue strategic acquisitions. Our ability to execute this strategy depends on continuing our dedicated commitments to customer service and safety and continuing to recruit and retain qualified drivers.

Our base revenue for each delivery is generally calculated by multiplying a negotiated mileage based rate by the quantity of product delivered. These negotiated rates compensate us both for transporting the products as well as for loading and unloading time. Our additional revenue consists of fees for extra stops to load or unload, powered product unloading and toll costs and fuel surcharges that help us manage our fuel costs. The main factors that affect our revenue are the number of revenue miles, rates per mile, and the amount of fuel surcharges. Our revenue miles depend on the number of customer locations that we serve, the location of the bulk terminals where customers require us to load, specific customer demand and consumption of petroleum products in the markets we serve.

Our revenue per mile is determined by our customer rates but also is impacted by our average haul length. Due to the short haul nature of our business, a significant portion of the time involved in each delivery consists of loading and unloading product. Revenue per mile is higher on shorter hauls as loading and unloading time comprises a higher percentage of the delivery time. We load the fuel that we deliver at different bulk terminals designated by our customers based on conditions in the petroleum supply chain. Our haul length and our revenue per mile may vary on deliveries to the same customer location because some bulk terminals will be further away from the delivery location and our revenue per mile generally is higher on shorter hauls.

We incorporate fuel surcharges into our negotiated rates to help us manage our fuel expense. The amount of fuel surcharges typically takes into account changes in underlying diesel prices, although there is a time lag between fuel price fluctuations and changes to fuel surcharges. In recent years, some customer contracts have been modified to provide for reduced fuel surcharges but have base rates that factor in a larger fuel expense. As a result of this trend, fuel surcharges declined from 17.8% of our total revenue in fiscal 2012 to 16.9% in

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fiscal 2013 and 16.1% in fiscal 2014. Our total revenue per mile, including fuel surcharges, increased 1.0% from 2012 to 2013 although revenue per mile decreased 1.7% from 2013 to 2014 due to lower rates on the business acquired in the Pipeline acquisition and a longer average haul length on the additional business. Accordingly, we believe that it is generally not meaningful to compare changes in fuel surcharge revenue as a percentage of total revenue between reporting periods. Management monitors revenue per mile, which includes fuel surcharges, to analyze effective pricing trends.

Our operating costs primarily consist of the following:

• Compensation and Benefits - Wages and employee benefits for our drivers and terminal and support personnel is the largest component of our operating costs. These costs are impacted by such factors as miles driven, driver pay increases, driver turnover and training costs and additional driver pay due to temporary out-of-town deployments to serve new business;

• Fuel Expenses - Our fuel expenses will vary depending on miles driven as well as such factors as fuel prices, the fuel efficiency of our fleet and the average haul length, which is impacted by variations in petroleum supply in our markets. Although diesel fuel prices have been relatively stable over the past three years, fuel prices can be highly volatile;

• Operating and Repairs – This category consists of vehicle maintenance (excluding shop personnel), tire expense (including amortization of tire cost and road repairs), tolls, hiring costs, driver travel cost, driver hiring costs, site maintenance and other operating expenses. These expenses will vary based on such factors as miles driven, the age of our fleet, tire prices, driver availability and driver travel, business growth and inflation among others;

• Insurance and Losses – This includes costs associated with insurance premiums, and the self-insured portion of liability, worker’s compensation, health insurance and cargo claims and wreck repairs. We work very hard to manage these expenses through our safety and wellness programs, but these expenses will vary depending on the frequency and severity of accident and health claims, insurance markets and deductible levels;

• Sales, General and Administrative Expenses - This category consists of the wages, bonus accruals, benefits, travel, vehicle and office costs for our administrative personnel as well as professional fees and amortization charges for intangible assets purchased in acquisitions of other businesses;

• Depreciation Expense – Depreciation expense consists of the depreciation of the cost of fixed assets such as tractors and trailers over the life assigned to those assets. Amortization of intangible assets is included under the sales, general and administrative expense category. The amount of depreciation expense is impacted by equipment prices and the timing of new equipment purchases. We expect the cost of new tractors and trailers to continue to increase, impacting our future depreciation expense;

• Rents, Tags and Utilities Expenses – This category consists of rents payable on leased facilities and leased equipment, federal highway use taxes, vehicle registrations, license and permit fees and personal property taxes assessed against our equipment, communications, utilities and real estate taxes;

• Corporate Expenses – Corporate expenses consist of wages, bonus accruals, benefits, travel, vehicle and office costs for corporate executives, director fees, stock option expense and aircraft expense;

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• Gains on Equipment Sales - Our financial results for any period may be impacted by any gain or loss that we realize on the sale of used equipment and losses on wrecked equipment. We periodically sell used equipment as we replace older tractors and trailers. Gains or losses on equipment sales can vary significantly from period to period depending on the timing of our equipment replacement cycle, market prices for used equipment and losses on wrecked equipment.

Our profitability depends on our ability to control these expenses. The primary measure we use to evaluate our profitability is our operating ratio (our operating expenses as a percentage of our operating revenue).

The trucking industry has been experiencing a shortage of qualified drivers in recent years, and we expect this trend to continue. Driver shortages and attrition may result in our inability to serve existing business and to take on new business, may require us to increase compensation levels and may require us to incur out-of-town driver pay and driver housing costs to send some of our drivers temporarily to the market where we are experiencing a driver shortage. For example, in fiscal 2014, our financial results were adversely affected by the need to send drivers out-of-town to service new business and to address higher than expected driver turnover in the Pipeline acquisition that we completed in November 2013.

Our revenues for fiscal 2014 were favorably impacted by our acquisition of assets of Pipeline Transportation, Inc. Our revenue miles increased 17.0% but our revenue per mile declined 1.7% due in part to lower rates under customer contracts assumed in the acquisition and a longer average haul length. At the same time, the acquisition of new business and higher-than-expected turnover in the acquired operations caused us to utilize more out-of-town drivers, increasing our compensation and operating costs. We have reduced the use of out-of-town drivers since the end of the second quarter and we expect that out-of-town driver costs will trend back to historic levels.

Mining Royalty Land. The mining royalty land segment owns and seeks to acquire land with construction aggregates deposits, a substantial portion of which is leased to Vulcan Materials Company under long-term mining royalty agreements, whereby the Company is paid a percentage of the revenues generated or annual minimums. The segment also owns mining related land held for future appreciation or development. In May 2012 the Company acquired approximately 1,200 acres near Lake Louisa, Florida which is west of Orlando, Florida for a purchase price of $11 million. The Company simultaneously executed a long-term royalty lease under which it receives a minimum monthly royalty payment until the tenant receives the necessary permits and begins mining sand. At September 30, 2014, the mining royalty land segment owned the following properties:

Locations currently being mined. The segment owns a total of 10,423 acres in Grandin, Keuka and Newberry, Florida, Columbus, Macon and Tyrone, Georgia and Manassas, Virginia. Tons sold in 2014 totaled 4,575,000 leaving estimated reserves of 332,680,000 tons.

Locations under royalty agreements but not currently being mined. The segment owns a total of 4,771 acres in Ft. Myers, Airgrove/Lake County, Marion County, Astatula/Lake County, and Lake Louisa, Florida, and Forest Park Georgia. Tons sold in 2014 totaled 1,000 leaving estimated reserves of 96,330,000 tons.

Investment Properties. The segment owns 1,923 acres of investment properties in Gulf Hammock, Brooksville, Palatka, and Polk County, Florida and Yatesville and Henderson, Georgia.

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Brooksville Quarry LLC. On October 4, 2006, a subsidiary of the Company (FRP) entered into a Joint Venture Agreement with Vulcan Materials Company (formerly Florida Rock Industries, Inc.) to form Brooksville Quarry, LLC, a real estate joint venture to develop approximately 4,300 acres of land near Brooksville, Florida. Distributions will be made on a 50-50 basis except for royalties and depletion specifically allocated to FRP. 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 in August 2012. The timing of development of this project is dependent on market demand.

Developed Property Rentals. The developed property rentals segment acquires, constructs, leases and manages land and commercial buildings in the Baltimore/Northern Virginia/Washington and Jacksonville, Florida areas.

Revenue from land and/or buildings is generated primarily from leasing our portfolio of flex office/warehouse buildings. Our flex office/warehouse product is a functional warehouse with the ability to configure portions as office space as required by our tenants. We lease space to tenants who generally sign multiple year agreements. Growth is achieved by increasing occupancy and lease rates in existing buildings and by developing or acquiring new warehouses. We attempt to develop or purchase properties in areas that have high growth potential and are accessible to major interstates or other distribution lanes.

Developed property rentals occupancy has remained constant at 89.6% from last fiscal year. Occupancy at September 30, 2014 and 2013 included 8,200 square feet or .2% and 42,606 square feet or 1.3% respectively for temporary space under less than full market lease rates. The Company resumed development of Patriot Business Park effective April 1, 2012 due to two developments. In February 2012, the Company signed an agreement to sell 15.18 acres of land at the site for a purchase price of $4,774,577 and the sale was completed in July 2013. The Company also entered into a build to suit lease signed April 2012, for a 117,600 square foot building which was completed and occupied by VADATA during the quarter ending March 31, 2013. In May 2013, the Company entered into a second build to suit lease, with VADATA, for a 125,500 square foot building which was completed and occupied during the quarter ending March 2014. In May, 2014, the Company entered into a long term lease with VADATA for its third build-to-suit data warehouse for 129,850 square feet. In June 2013, the Company purchased Transit Business Park in Baltimore, Maryland which consists of 5 buildings on 14.5 acres totaling 232,318 square feet which are 66.4% occupied. In June 2014, the Company purchased Kelso Business Park in Baltimore, Maryland which consists of 2 buildings on 10.2 acres totaling 69,680 square feet.

The following table shows the total developed square footage and occupancy rates of our flex office/warehouse and office parks at September 30, 2014:

		Total
Development	Location	Sq. feet	% Occupied
Hillside	Anne Arundel Co., MD	567,473	96.1	%
Lakeside	Harford Co., MD	893,722	88.6	%
Tudsbury	Baltimore Co., MD	86,100	100.0	%
Dorsey Run	Howard Co., MD	85,100	100.0	%
Rossville	Baltimore Co., MD	190,517	100.0	%
Loveton	Baltimore Co., MD	33,708	81.4	%
Oregon	Anne Arundel Co., MD	195,615	82.9	%
Arundel	Howard Co., MD	162,796	100.0	%
Interchange	New Castle Co., DE	303,006	60.4	%

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Azalea Garden	Norfolk, VA	188,093	100.0	%
Windlass Run	Baltimore Co., MD	69,474	100.0	%
21st Street	Duval Co., FL	68,757	100.0	%
Hollander 95	Baltimore Co., MD	82,800	100.0	%
Patriot Business Park	Prince William Co., VA	243,150	100.0	%
Transit Business Park	Baltimore Co., MD	232,318	66.4	%
Kelso Business Park	Baltimore Co., MD	69,680	100.0	%
		3,472,309	89.6	%

Developed square feet increased by 195,230 or 6.0% from 3,277,079 at September 30, 2013 to 3,472,309 at September 30, 2014 due to the building constructed at Patriot Business Park and the purchase of Kelso Business Park. Average occupancy in fiscal 2014 was 89.8% compared to 88.7% in fiscal 2013 and 85.1% in fiscal 2012. As of September 30, 2014, leases at our properties representing approximately 13%, 11%, 18%, 18% and 3% of the total square footage of buildings completed prior to September 2014 were scheduled to expire in fiscal year 2015, 2016, 2017, 2018 and 2019, respectively. There is currently vacant space in the portfolio. Leasing or renewing these spaces will be critical to future financial results.

In addition to the completed buildings there are approximately 125 acres in four separate distinct submarkets capable of holding up to 17 buildings totaling 1,406,906 square feet (inclusive of 129,850 square feet under construction). This pipeline for future vertical construction is a major part of our business plan. The net book value of these properties at September 30, 2014 was $29,592,000.

		Proposed
	Acres	Sq. Ft.	Comments
Under Construction:
Patriot Business Park Bldg A	8	129,850	Under Construction
Developed Lots:
Lakeside Business Park	20	266,530	Ready for building construction
Windlass Run Business Park	29	236,626	Ready for building construction
Windlass Run Business Park	8	150,000	Design and permitting ongoing
Patriot Business Park	23	198,150	Horizontal development ongoing
Hollander Business Park	33	345,750	Horizontal development ongoing
Hollander Business Park	4	80,000	Design and permitting ongoing

Additional Properties held for investment or future development include:

Windlass Run Residential (previously Bird River) phase 2, located in southeastern Baltimore County, Maryland, is a 74 acre tract of land adjacent to our Windlass Run Business Park. The property was rezoned in September 2007 to allow for additional density. The Company executed two contracts on April 17, 2013 with a buyer for the sale of phase 1 of the property in the quarter ending September 30, 2013 for $8.0 million and the balance for $11.0 million approximately 18 months later. The sale of phase 1 was completed in August of 2013 and resulted in a gain of $4,928,000. The sale of phase two is scheduled to close in March of 2015 and would generate a gain of approximately $6.0 million.

The Company owns a 5.8 acre parcel of undeveloped real estate in Washington D.C. that fronts the Anacostia River and is adjacent to the Washington Nationals Baseball Park. The parcel was leased to a subsidiary of Vulcan Materials Company from 1986 through August 2011. In September 2011 Vulcan commenced a long term lease for a Company owned 2.1 acre tract which is nearby on the same bank of the Anacostia River. The approved planned unit development for the 5.8 acre parcel permits the Company to develop a four building, mixed use project, containing

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approximately 545,800 square feet of office and retail space and approximately 569,600 square feet of additional space for residential and hotel uses. The approved development would include numerous publicly accessible open spaces and a waterfront esplanade along the Anacostia River.

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 a portion 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 Patriot. Construction commenced in October 2014. At this point the Company anticipates lease up scheduled in 2016 and 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.

Leister property in Hampstead, Carroll County, Maryland is a 117 acre parcel located adjacent to State Route 30 bypass. The parcel is currently zoned for industrial use. Alternative uses are being investigated in order to maximize this assets’ profitability and expedite its disposition.

COMPARATIVE RESULTS OF OPERATIONS

Transportation

	Fiscal Years ended September 30
(dollars in thousands)	2014			%			2013			%			2012			%
Transportation revenue	$	108,424			83.9	%		93,227			83.1	%		85,060			82.2	%
Fuel surcharges		20,738			16.1	%		18,893			16.9	%		18,416			17.8	%
Revenues		129,162			100.0	%		112,120			100.0	%		103,476			100.0	%
Compensation and benefits		47,431			36.7	%		40,095			35.8	%		36,875			35.6	%
Fuel expenses		29,281			22.7	%		25,699			22.9	%		24,174			23.4	%
Operating and repairs		13,082			10.1	%		10,682			9.5	%		9,832			9.5	%
Insurance and losses		10,729			8.3	%		7,544			6.7	%		7,498			7.2	%
Depreciation expense		8,210			6.4	%		7,202			6.4	%		6,577			6.4	%
Rents, tags & utilities		3,706			2.9	%		2,435			2.2	%		2,498			2.4	%
Sales, general & administrative		9,273			7.2	%		8,789			7.9	%		8,166			7.9	%
Allocated corporate expenses		1,722			1.3	%		1,765			1.6	%		1,631			1.6	%
Gain on equipment sales		(578	)		(.5	%)		(1,445	)		(1.3	%)		(1,251	)		(1.2	%)
Cost of operations		122,856			95.1	%		102,766			91.7	%		96,000			92.8	%
Operating profit	$	6,306			4.9	%		9,354			8.3	%		7,476			7.2	%

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Fiscal Year 2014 versus 2013

Comparability for fiscal 2014 to fiscal 2013 is affected by the acquisition of the assets of Pipeline Transportation in the first quarter of fiscal 2014.

Transportation segment revenues increased 15.2% and revenue miles increased 17.0% compared to fiscal 2013. Our loads increased 12.6% over the same period last year, and our average haul length increased 3.9%. We increased our business in most of our markets, resulting in more loads hauled at 16 of our 21 terminals. The terminals servicing the acquired Pipeline business accounted for 73% of the additional loads, including new business acquired independent of the Pipeline acquisition. The increase in the average haul length is primarily due to a higher than average haul length on the additional loads added during fiscal 2014. Revenue per mile decreased 1.7% over the same period last year, due to lower rates on the business acquired in the Pipeline acquisition and because revenue per mile generally declines as the average haul length increases.

Fuel surcharge revenue decreased .8% as a percentage of total revenue due to lower fuel surcharges on the acquired business and an increase in business with customers with higher base rates and lower fuel surcharges. We believe that it is generally not meaningful to compare changes in fuel surcharge revenue as a percentage of total revenue between reporting periods. Management monitors revenue per mile, which includes fuel surcharges, to analyze effective pricing trends.

The transportation segment’s operating ratio in fiscal 2014 increased to 95.1% compared to 91.7% in fiscal 2013. The higher operating ratio was attributable to the decline in revenue per mile and the following expense increases:

• Compensation and benefits increased ..9% as a percentage of revenues due primarily to the lower revenue per mile along with a $295,000 increase in out-of-town driver pay and $212,000 increase in driver training pay to service new business and to address unexpected driver attrition in the acquired Pipeline business.

• Operating and repairs expenses increased .6% as a percentage of revenues due primarily to a $452,000 increase in driver travel and housing costs for out-of-town drivers, a $350,000 increase in tolls expense, a $186,000 increase in driver hiring costs and $74,000 in rigging and rebranded costs related to the Pipeline acquisition.

• Insurance and losses increased $3,185,000, or 1.6% as a percentage of revenues. Approximately 50% of the increase was attributable to higher health insurance claims due in large part to unusually low health claims in 2013. Accident claims accounted for the balance of the increase as the Company experienced an increase in accident severity and accident frequency. Safety remains a primary focus of our culture and these increases are under continuous intense scrutiny.

• Rents, tags and utilities increased ..7% as a percentage of revenues due primarily to the addition of leased tractors in the Pipeline acquisition.

• Gains on equipment sales decreased ..8% as a percentage of revenues because we sold less equipment than we did in fiscal 2013 and we incurred a $355,000 loss on wrecked equipment.

These expense increases were partially mitigated by lower sales, general and administrative and corporate expenses as a percentage of revenue. Bonus compensation declined by $1,717,000, legal and audit fees increased $346,000 year

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over year primarily due to the spin-off and the Company accrued $575,000 in the fourth quarter of 2014 under the Management Security Plan due to the death prior to retirement of one of the Plan participants.

Fiscal Year 2013 versus 2012

In fiscal 2013, the transportation segment increased revenues to $112,120,000, an 8.4% increase over the fiscal 2012 because of a 7.3% increase in revenue miles and a 1% improvement in revenue per mile. Business growth and a slightly longer average haul length accounted for the higher revenue miles and rate increases accounted for the slight improvement in revenue per mile.

Fuel surcharge revenue in fiscal 2013 was positively impacted by the time delay between fuel price increases in 2012 and the effective date of the fuel surcharge adjustments. Nevertheless, fuel surcharge revenue for fiscal 2013 decreased .9% as a percentage of total revenue versus fiscal 2012 as we increased our business with customers with higher base rates and lower fuel surcharges. We believe that it is generally not meaningful to compare changes in fuel surcharge revenue as a percentage of total revenue between reporting periods. Management monitors revenue per mile, which includes fuel surcharges, to analyze effective pricing trends.

The transportation segments operating ratio improved to 91.7% in fiscal 2013 compared to 92.8% in 2012. The improvement was due to higher revenue per mile as well as the following expense improvements:

• Although the average price paid per gallon of diesel fuel increased by .4% over fiscal 2012, fuel expense decreased .5% as a percentage of revenue due to the improvement in revenue per mile.

• Insurance and losses decreased ..5% as a percentage of revenues due primarily to lower health insurance claims, partly offset by higher accident claims.

• Rents, tags and utilities decreased ..2% as a percentage of revenues due to lower real estate taxes and lower telecommunications charges.

• Gains on equipment sales increased ..1% as a percentage of revenues as we sold more equipment during 2013 that resulted in higher gains than in 2012.

These expense improvements were partly offset by an increase in compensation and benefits due to a driver pay increase in March 2013 that was not fully offset by the improved revenue per mile.

Mining Royalty Land

	Fiscal Years ended September 30
(dollars in thousands)	2014		%			2013			%			2012			%
Mining royalty land revenue	$	5,349		100	%		5,302			100	%		4,483			100	%
Property operating expenses		489		9	%		478			9	%		468			10	%
Depreciation and depletion		124		3	%		106			2	%		112			3	%
Management company indirect		-		0	%		(21	)		0	%		(2	)		0	%
Allocated corporate expense		755		14	%		731			13	%		674			15	%
Cost of operations		1,368		26	%		1,294			24	%		1,252			28	%
Operating profit	$	3,981		74	%	$	4,008			76	%	$	3,231			72	%

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Revenues 2014 vs 2013 – Mining royalty land segment revenues for fiscal 2014 were $5,349,000, an increase of $47,000 or .9% compared to $5,302,000 in 2013.

Revenues 2013 vs 2012 – Mining royalty land segment revenues for fiscal 2013 were $5,302,000, an increase of $819,000 or 18.3% compared to $4,483,000 in 2012 due to royalties on new property purchased in May 2012 along with a shift in production at two locations increasing the share of mining on properties owned by the Company partially offset by lower timber sales.

Expenses 2014 vs 2013 – The mining royalty land segment’s cost of operations increased $74,000 to $1,368,000 in 2014, compared to $1,294,000 in 2013, primarily due to increased depletion and allocated corporate expenses. Corporate expense increased due to $138,000 allocated spin-off costs less reduced corporate bonus expense.

Expenses 2013 vs 2012 – The mining royalty land segment’s cost of operations increased $42,000 to $1,294,000 in 2013, compared to $1,252,000 in 2012, primarily due to the $57,000 increase in allocated corporate expenses offset by a $19,000 decrease in indirect management company costs to this segment.

Developed Property Rentals

	Fiscal Years ended September 30
(dollars in thousands)	2014		%			2013		%			2012		%
Developed property rentals revenue	$	25,629		100	%		22,352		100	%		19,555		100	%
Property operating expenses		7,323		29	%		5,456		25	%		4,879		25	%
Depreciation and amortization		6,654		26	%		5,874		26	%		5,633		29	%
Environmental remediation		-		0	%		-		0	%		1,771		9	%
Management company indirect		1,424		6	%		1,595		7	%		1,775		9	%
Allocated corporate expense		1,133		4	%		1,094		5	%		1,012		5	%
Cost of operations		16,534		65	%		14,019		63	%		15,070		77	%
Operating profit	$	9,095		35	%	$	8,333		37	%	$	4,485		23	%

Revenues 2014 vs 2013 – Developed property rentals segment revenues increased $3,277,000 or 14.7% in 2014 to $25,629,000 due to higher average occupancy, snow removal reimbursements, revenue on the 117,600 square foot build to suit building completed and occupied during the quarter ended March 2013, revenue on the 125,550 square foot build to suit building completed and occupied during the quarter ended March 2014, revenue on the 5 buildings added June 2013 related to the purchase of Transit Business Park and revenue on the 2 buildings added June 2014 related to the purchase of Kelso Business Park. Occupancy at both September 30, 2014 and 2013 was 89.6%.

On June 6, 2014 the Company purchased Kelso Business Park in Baltimore, Maryland which consists of 2 buildings on 10.2 acres totaling 69,680 square feet which were 100% occupied.

On May 1, 2014, the Company entered into a long term lease with VADATA for its third build-to-suit data warehouse for 129,850 sq. ft.; the first (117,600 sq. ft.) and second (125,550 sq. ft.) build-to-suit data warehouses were completed and occupied in January 2013 and January 2014, respectively.

Revenues 2013 vs 2012 – Developed property rentals segment revenues increased $2,797,000 or 14.3% in 2013 to $22,352,000 due to higher occupancy, revenue on a 117,600 square foot build to suit building completed and occupied during the

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period and revenue on the purchase of Transit Business Park which consists of 5 buildings. Occupancy at September 30, 2013 was 89.6% as compared to 88.7% at September 30, 2012.

On June 20, 2013 the Company purchased, through a qualified intermediary, Transit Business Park in Baltimore, Maryland which consists of 5 buildings on 14.5 acres totaling 232,318 square feet which were 66.4% occupied. This purchase was completed as a forward 1031 exchange with the sale of phase 1 of Windlass Run Residential.

Expenses 2014 vs 2013 – Developed property segment’s cost of operations increased to $16,534,000 in 2014, compared to $14,019,000 in 2013. Property operating expenses increased $1,867,000 due to higher average occupancy, higher property taxes ($952,000), snow removal costs ($702,000) and the new buildings placed in service. Depreciation and amortization increased $780,000 due to the newly completed build to suit buildings, the purchase of Transit Business Park and the purchase of Kelso Business Park reduced by certain tenant improvements becoming fully depreciated. Management Company indirect expenses (excluding internal allocations for lease related property management fees) decreased $171,000 due to lower health insurance costs partially offset by higher professional fees. Allocated corporate expenses increased $39,000 due to $208,000 allocated spin-off costs less reduced corporate bonus expense.

Expenses 2013 vs 2012 – Developed property segment’s cost of operations decreased to $14,019,000 in 2013, compared to $15,070,000 in 2012. Property operating expenses increased $577,000 due to higher property taxes, snow removal costs and higher occupancy. Depreciation and amortization increased $241,000 due to the newly completed build to suit and the purchase of Transit Business Park reduced by certain tenant improvements becoming fully depreciated. The Company recorded an expense in the fourth quarter of fiscal 2012 of $1,771,000 for an environmental remediation liability pertaining to phase I of the Riverfront development of property on the Anacostia in Washington, D.C. The actual expense may be materially higher or lower depending upon the determined responsibility of the prior tenant, our ability to collect from such prior tenant and actual costs incurred. Management Company indirect expenses (excluding internal allocations for lease related property management fees) decreased $180,000 due to the prior year including severance costs along with high health insurance claims. Allocated corporate expenses increased $82,000.

Consolidated Results

Operating Profit - Consolidated operating profit was $17,768,000 in fiscal 2014 compared to $20,434,000 in 2013, a decrease of 13.0%. Operating profit in the transportation segment decreased $3,048,000 or 32.6% primarily due to lower revenue per mile, $3,185,000 higher insurance and claims, a $747,000 increase in costs incurred to use out-of-town drivers to service new business, a $575,000 accrual under the Management Security Plan due to the death prior to retirement of one of the Plan participants, write-offs of $355,000 on equipment due to accidents and $346,000 of spin-off costs partially offset by reduced bonus compensation of $1,717,000. Operating profit in the mining royalty land segment decreased $27,000 or .7% due to increased depletion and allocated corporate expenses. Operating profit in the Developed property rentals segment increased $762,000 or 9.1% primarily due to higher average occupancy, the 117,600 square foot build to suit building completed and occupied during the second quarter 2013, the addition of the 125,550 square foot build to suit building completed and occupied during the second quarter 2014 offset by higher property taxes. Consolidated operating profit includes corporate expenses not allocated to any segment in the amount of $1,614,000 in fiscal 2014, an increase of $353,000

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compared to 2013 primarily due to the higher market value associated with the annual director stock grant. Consolidated operating profit was $20,434,000 in 2013 compared to $14,101,000 in 2012 an increase of 44.9%.

Gain on termination of sale contract – Fiscal 2012 includes a gain of $1,039,000 on the receipt of non-refundable deposits related to the termination of an agreement to sell the Company’s Windlass Run Residential property.

Gain on investment land sold – Fiscal 2014 includes $310,000 for the sale of a parcel in Patriot Business Park and $166,000 of deferred profits on prior year land sales related to post closing development obligations. Fiscal 2013 includes total gains on investment land sold of $7,333,000. Income from continuing operations for the first quarter of fiscal 2013 included a gain on the sale of the developed property rentals Commonwealth property in Jacksonville, Florida, of $1,116,000 before income taxes. The book value of the property was $723,000. In July 2013 the Company sold 15.18 acres of land at Patriot Business Park resulting in a gain of $341,000 before income taxes. The book value of the property was $3,603,000. In August 2013 the Company sold 5.38 acres of land at Hollander 95 Business Park and recorded a gain before income taxes of $514,000. The book value of the property was $595,000. In August 2103 the Company sold phase 1 of the Windlass Run Residential property and recorded a gain of $4,928,000 before income taxes. The book value of the property was $2,971,000. In August 2013 the Company sold 284 acres of Gulf Hammock mining property and recorded a gain of $433,000 before income taxes. The book value of the property was $296,000.

Interest expense – Interest expense for fiscal 2014 decreased $1,045,000 over 2013 due to an accelerated payment on long-term debt and a declining mortgage principal balance. Interest expense for fiscal 2013 decreased $118,000 over 2012 due to declining mortgage interest expense and higher capitalized interest partially offset by the accelerated prepayment of long-term debt. On June 3, 2013 the Company prepaid the $7,281,000 remaining principal balance on a 6.12% mortgage under an early prepayment provision the note allowed after 7.5 years. The $561,000 cost of the prepayment included a penalty of $382,000 and the remaining deferred loan costs of $175,000. On July 31, 2013 the Company prepaid the $279,000 remaining principal balance on a 7.97% mortgage. The cost of the prepayment included a penalty of $7,000. The amount of interest capitalized on real estate projects under development was $217,000 higher than the same period in fiscal 2012 primarily due to resumed development of Patriot Business Park in April 2012.

Income taxes – Income tax expense for 2014 decreased $3,185,000 due to lower earnings. Income tax expense for 2013 increased $5,028,000 over 2012 due to higher earnings from continuing operations.

Income from continuing operations – Income from continuing operations was $10,019,000 or $1.03 per diluted share in 2014, a decrease of 34.9% compared to $15,385,000 or $1.60 per diluted share in 2013. The $5,366,000 decrease was due to the $7,333,000 gain on the sale of investment land in 2013, the $2,666,000 decrease in operating profits, offset by the increase in income taxes and the $476,000 gain on the sale of investment land.

Income from continuing operations was $15,385,000 or $1.60 per diluted share in 2013, an increase of 99.5% compared to $7,711,000 or $.81 per diluted share in 2012.

Discontinued operations – The after tax income from discontinued operations was $97,000 or $.01 per diluted share in fiscal 2012.

Net income – Net income for fiscal 2014 was $10,019,000 compared to $15,385,000 in fiscal 2013. Diluted earnings per common share decreased to $1.03 in fiscal 2014 from $1.60 in 2013, and were $.82 in 2012.

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LIQUIDITY AND CAPITAL RESOURCES

The growth of the Company’s businesses requires significant cash needs. The Company expects to meet short-term liquidity requirements generally through working capital, net cash provided by operations, and, if necessary, borrowings on its unsecured revolving credit facility. The Company intends to meet long-term funding requirements for transportation equipment and acquisitions, property acquisitions and development, debt service, and share repurchases through net cash from operations, long-term secured and unsecured indebtedness, including borrowings under its unsecured revolving credit facility, and proceeds from sales of strategically identified assets.

Cash Flows - The following table summarizes our cash flows from operating, investing and financing activities for each of the periods presented (in thousands of dollars):

			Years Ended September 30,
	2014					2013			2012
Total cash provided by (used for):
Operating activities	$	23,354			$		26,878		$	20,484
Investing activities		(39,371		)			(22,525	)		(31,656	)
Financing activities		16,528					(10,564	)		(3,141	)
Increase (decrease) in cash and
cash equivalents	$	511			$		(6,211	)	$	(14,313	)

Operating Activities - Net cash provided by operating activities was $23,354,000 for the year ended September 30, 2014, $26,878,000 in 2013 and $20,484,000 in 2012.

The total of net income plus depreciation, depletion and amortization less gains on sales of property and equipment decreased $4,534,000 versus the same period last year. These changes are described above under “Comparative Results of Operations”. The net change in deferred and current income taxes payable reduced cash flows by $5,913,000 compared to the same period last year due to the timing of tax payments and the expiration of bonus tax deprecation as of January 1, 2014. Cash flows from operating activities in 2012 included cash flows provided by discontinued operations of $177,000.

Investing Activities – For the year ended September 2014, cash required by investing activities was $39,371,000 compared to $22,525,000 in 2013. The current year included $5,981,000 lower purchases of transportation equipment exclusive of the Pipeline Transportation acquisition for $10,023,000. Investment in real estate segment was $3,653,000 lower primarily due to the lower cost of the Kelso property as compared with the Transit Business Park purchase last year. Cash required by investing activities was reduced by $1,508,000 released from escrow cash due to fulfillment of obligations related to the prior sale of properties. Proceeds from the sale of real estate and equipment was $14,384,000 lower due to the sale of real estate held for investment in fiscal 2013.

In 2013, cash required by investing activities was $22,525,000 compared to $31,656,000 in 2012. The lower investing cash use was due to proceeds from the sale of real estate held for investment.

Financing Activities - Cash provided by financing activities in the year ended September 30, 2014, was $16,528,000 compared to use of $10,564,000 in 2013. Our Revolver debt increased $17,645,000 compared to last year. There was a $7,281,000 prepayment of a mortgage in June 2013 and a $279,000 prepayment of a mortgage in July 2013 which reduced the cash provided by financing in the prior

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year.

Net cash used in financing activities was $10,564,000 in 2013 and $3,141,000 in 2012, $7,423,000 higher due to the accelerated repayment on long term debt in fiscal 2013.

Credit Facilities - On December 21, 2012, the Company entered into a five year credit agreement with Wells Fargo Bank, N.A. with a maximum facility amount of $55 million (the "Credit Agreement"). The Credit Agreement provides a revolving credit facility (the “Revolver”) with a maximum facility amount of $40 million, with a $20 million sublimit for standby letters of credit, and a term loan facility of $15 million. As of September 30, 2014, $17,645,000 was borrowed under the Revolver, $5,421,000 in letters of credit was outstanding, and $31,934,000 was available for additional borrowing. The letters of credit were issued for insurance retentions and to guarantee certain obligations to state agencies related to real estate development. Most of the letters of credit are irrevocable for a period of one year and typically are automatically extended for additional one-year periods. The Revolver bears interest at a rate of 1.0% over the selected LIBOR, which may change quarterly based on the Company’s ratio of Consolidated Total Debt to Consolidated Total Capital, as defined. A commitment fee of 0.15% per annum is payable quarterly on the unused portion of the commitment. The commitment fee may also change quarterly based upon the ratio described above. The Credit Agreement contains certain conditions, affirmative financial covenants and negative covenants including limitations on paying cash dividends. As of September 30, 2014, $73,558,000 of consolidated retained earnings would be available for payment of dividends. The Company was in compliance with all covenants as of September 30, 2014.

Cash Requirements - The Board of Directors has authorized Management to repurchase shares of the Company’s common stock from time to time as opportunities arise. During fiscal 2014 the Company did not repurchase any shares of stock. During fiscal 2013 the Company repurchased 8,700 shares for $233,000. As of September 30, 2014, $3,682,000 was authorized for future repurchases of common stock. The Company does not currently pay any cash dividends on common stock.

While the Company is affected by environmental regulations, such regulations are not expected to have a major effect on the Company’s capital expenditures or operating results with the exception of the Anacostia property described in our risk facors and Note 12 of the Notes to the Consolidated Financial Statements.

The Company reached an agreement with the District of Columbia in November 2011 concerning the assessed value of the Company’s property resulting in a credit due to the Company. The taxes previously paid relating to the property were capitalized to the cost of the land as we are actively pursuing development of the property. The entry to record this agreement was to establish a receivable for the taxes and to credit the cost of the land in the amount of $2,311,000. As of September 30, 2014 all of the tax receivable was received.

The Company currently expects its fiscal 2015 capital expenditures to be approximately $23,810,000 ($12,498,000 for real estate development expansion, $11,312,000 for transportation segment expansion and replacement equipment). Depreciation and depletion expense is expected to be approximately $14,955,000.

The Company expects that cash flows from operating activities, secured financing on existing and planned real estate projects, cash on hand and the funds available under its revolving credit agreement will be adequate to finance these capital expenditures and its working capital needs for the next 12 months and the foreseeable future.

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OFF-BALANCE SHEET ARRANGEMENTS

Except for the letters of credit described above under “Liquidity and Capital Resources,” the Company does not have any off balance sheet arrangements that either have, or are reasonably likely to have, a current or future material effect on its financial condition.

CRITICAL ACCOUNTING POLICIES

Management of the Company considers the following accounting policies critical to the reported operations of the Company:

Accounts Receivable and Unrealized Rents Valuation. The Company is subject to customer credit risk that could affect the collection of outstanding accounts receivable and unrealized rents, that is rents recorded on a straight-lined basis. To mitigate these risks, the Company performs credit reviews on all new customers and periodic credit reviews on existing customers. A detailed analysis of late and slow pay customers is prepared monthly and reviewed by senior management. The overall collectibility of outstanding receivables and straight-lined rents is evaluated and allowances are recorded as appropriate. Significant changes in customer credit could require increased allowances and affect cash flows.

Property and Equipment and Goodwill. Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

	Years
Buildings and improvements	7-39
Revenue equipment	7-10
Other equipment	3-10

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves.

The Company periodically reviews property and equipment for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. The review of real estate group assets consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures. The Company’s estimated holding period for developed buildings with current vacancies is long enough that the undiscounted cash flows exceed the carrying value of the properties and thus no impairment loss is recorded. The review of the transportation segment assets consists of a review of future anticipated results considering business prospects and asset utilization. If the sum of these future cash flows (undiscounted and without interest charges) is less than the carrying amount of the assets, the Company would record an impairment loss based on the fair value of the assets with the fair value of the assets generally based upon an estimate of the discounted future cash flows expected with regards to the assets and their eventual disposition as the measure of fair value. The Company performs an annual impairment test on goodwill. Changes in estimates or assumptions could have an impact on the Company’s financials.

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All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a development cost of the property. Included in indirect costs is an estimate of internal costs associated with development and rental of real estate investments. Changes in estimates or assumptions could have an impact on the Company’s financials.

Risk Insurance. The nature of the transportation business subjects the Company to risks arising from workers’ compensation, automobile liability, and general liability claims. The Company retains the exposure on certain claims of $250,000 ($500,000 for automobile liability and general liability claims prior to fiscal 2011 and for worker’s compensation claims prior to fiscal 2013) and has third party coverage for amounts exceeding the retention up to the amount of the policy limits. The Company expenses during the year an estimate of risk insurance losses based upon independent actuarial analysis, insurance company estimates, and our monthly review of claims reserve changes. In making claim reserve changes we rely upon estimates of our insurance company adjusters, attorney evaluations, and judgment of our management. Our estimates require judgment concerning the nature, severity, comparative liability, jurisdiction, legal and investigative costs of each claim. Claims involving serious injury have greater uncertainty of the eventual cost. In the past, our estimate of the amount of individual claims has increased from insignificant amounts to the full deductible as we learn more information about the claim in subsequent periods. We obtain an independent actuarial analysis at least twice annually to assist in estimating the total loss reserves expected on claims including claim development and incurred but not reported claims. We also retain exposure on employee health benefits up to $250,000 per claim each calendar year plus a $72,000 aggregate deductible for any claims exceeding $250,000. We estimate claim liability using historical payment trends and specific knowledge of larger claims. Health claims are expensed as the health services are rendered so there only is a two month lag in payments on average. We are usually aware of the larger claims before closing each accounting period reducing the amount of uncertainty of the estimate. Our accrued insurance liabilities for retiree benefits are recorded by actuarial calculation. Our accrued insurance liabilities for claims as of September 30, 2014, 2013, and 2012 amounted to $2.6 million, $2.4 million and $4.9 million, respectively. Accrued insurance liabilities decreased in fiscal 2013 due to payments to our new insurer under a captive agreement along with payment in settlement of three unusually large prior year liability and health claims. Payments under the captive agreement for the year-to-date loss fund are estimated in advance using actuarial methodology. The captive agreement provides that we will share in the underwriting results, good or bad, within a $250,000 per occurrence layer of loss through retrospective premium adjustments. Including the potential exposure in the captive we have $4.8 million of estimated insurance liabilities. In the event that actual costs for these claims are different than estimates we will have adjustments in future periods. It is likely that we will experience either gains or losses of 5-10% of prior year estimated insurance liabilities in any year.

Income Taxes. The Company accounts for income taxes under the asset-and-liability method. Deferred tax assets and liabilities represent items that will result in taxable income or a tax deduction in future years for which the related tax expense or benefit has already been recorded in our statement of earnings. Deferred tax accounts arise as a result of timing differences between when items are recognized in the Consolidated Financial Statements compared with when they are recognized in the tax returns. The Company assesses the likelihood that deferred tax assets will be recovered from future taxable income. To the extent recovery is not probable, a valuation allowance is established and included as an expense as part of our income tax provision. No valuation allowance was recorded

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at September 30, 2013, as all deferred tax assets are considered more likely than not to be realized. Significant judgment is required in determining and assessing the impact of complex tax laws and certain tax-related contingencies on the provision for income taxes. As part of the calculation of the provision for income taxes, we assess whether the benefits of our tax positions are at least more likely than not of being sustained upon audit based on the technical merits of the tax position. For tax positions that are more likely than not of being sustained upon audit, we accrue the largest amount of the benefit that is more likely than not of being sustained in our consolidated financial statements. Such accruals require estimates and judgments, whereby actual results could vary materially from these estimates. Further, a number of years may elapse before a particular matter, for which an established accrual was made, is audited and resolved.

CONTRACTUAL OBLIGATIONS

The following table summarizes our contractual obligations as of September 30, 2014:

	Payments due by period
			Less than		1-3	3-5	More than
		Total		1 year	years	years	5 years
Mortgages Including Interest	$	61,044		7,230	13,988	11,836	27,990
Operating Leases		2,500		393	556	556	995
Purchase Commitments		4,867		4,863	4	-	-
Other Long-Term Liabilities		1,547		164	174	184	1,025
Total Obligations	$	69,958		12,650	14,722	12,576	30,010

INFLATION

Most of the Company’s operating expenses are inflation-sensitive, with inflation generally producing increased costs of operations. During the past three years, inflation has been fairly modest with its impacts mostly related to equipment prices, tire prices and the compensation paid to drivers. Tractor prices have increased over 30% since 2007 due in part to EPA mandated new engine emission requirements on tractor engines. Customer rate increases received have significantly lagged the increased prices paid for new equipment over the same period.

In addition to inflation, fluctuations in fuel prices can affect profitability. Significant fluctuations in fuel prices increase our cost of operations as the Company is unable to pass through all increases in fuel prices. Most of the Company’s contracts with customers contain fuel surcharge provisions. Although the Company historically has been able to pass through most long-term increases in fuel prices and operating taxes to customers in the form of surcharges and higher rates, there is no guarantee that this will be possible in the future.

Substantially all of the Company’s royalty agreements are based on a percentage of the sales price of the related mined items. Minimum royalties and substantially all lease agreements provide escalation provisions.

SEASONALITY

Our business is subject to seasonal trends common in the refined petroleum products delivery industry. We typically face reduced demand for refined

78

petroleum products delivery services during the winter months and increased demand during the spring months. Further, operating costs and earnings are generally adversely affected by inclement weather conditions. These factors generally result in lower operating results during the first and fourth quarters of the year and cause our operating results to fluctuate from quarter to quarter. Our operating expenses also have been somewhat higher in the winter months, due primarily to decreased fuel efficiency and increased maintenance costs for tractors and trailers in colder months.

FORWARD LOOKING STATEMENTS

Certain matters discussed in this report contain forward-looking statements, including without limitation relating to the Company's plans, strategies, objectives, expectations, intentions, capital expenditures, future liquidity, plans and timetables for completion of pending development projects and the timetable for the completion of the proposed spin-off of the transportation group. The words or phrases “anticipate,” “estimate,” ”believe,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target” and similar expressions identify forward-looking statements. The following factors and others discussed in the Company’s periodic reports and filings with the Securities and Exchange Commission are among the principal factors that could cause actual results to differ materially from the forward-looking statements: uncertainties as to whether the Company will be able to complete, and recognize the benefits of, the proposed spin-off of the transportation group; freight demand for petroleum products including recessionary and terrorist impacts on travel in the Company’s markets; levels of construction activity in the markets served by our mining properties; fuel costs and the Company’s ability to recover fuel surcharges; accident severity and frequency; risk insurance markets; driver availability and cost; the impact of future regulations regarding the transportation industry; availability and terms of financing; competition; interest rates, inflation and general economic conditions; demand for flexible warehouse/office facilities in the Baltimore-Washington-Northern Virginia area; and ability to obtain zoning and entitlements necessary for property development. However, this list is not a complete statement of all potential risks or uncertainties.

These forward-looking statements are made as of the date hereof based on management’s current expectations, and the Company does not undertake an obligation to update such statements, whether as a result of new information, future events or otherwise. Additional information regarding these and other risk factors may be found in the Company’s other filings made from time to time with the Securities and Exchange Commission.

79

CONSOLIDATED STATEMENTS OF INCOME - Years ended September 30

(In thousands, except per share amounts)

		2014		2013		2012
Revenues:
Transportation	$	129,162		112,120		103,476
Mining royalty land		5,349		5,302		4,483
Developed property rentals		25,629		22,352		19,555
Total revenues		160,140		139,774		127,514
Cost of operations:
Transportation		122,856		102,766		96,000
Mining royalty land		1,368		1,294		1,252
Developed property rentals		16,534		14,019		15,070
Unallocated corporate		1,614		1,261		1,091
Total cost of operations		142,372		119,340		113,413
Operating profit:
Transportation		6,306		9,354		7,476
Mining royalty land		3,981		4,008		3,231
Developed property rentals		9,095		8,333		4,485
Unallocated corporate		(1,614	)	(1,261	)	(1,091	)
Total operating profit		17,768		20,434		14,101
Gain on termination of sale contract		—		—		1,039
Gain on investment land sold		476		7,333		—
Interest income and other		30		38		26
Equity in loss of joint ventures		(128	)	(63	)	(8	)
Interest expense		(1,475	)	(2,520	)	(2,638	)
Income before income taxes		16,671		25,222		12,520
Provision for income taxes		6,652		9,837		4,809
Income from continuing operations		10,019		15,385		7,711
Gain from discontinued operations, net		—		—		97
Net income	$	10,019		15,385		7,808
Earnings per common share:
Income from continuing operations -
Basic		1.04		1.62		0.82
Diluted		1.03		1.60		0.81
Discontinued operations -
Basic		0.00		0.00		0.01
Diluted		0.00		0.00		0.01
Net Income -
Basic		1.04		1.62		0.83
Diluted		1.03		1.60		0.82
Number of weighted average shares (in thousands) used in computing:
-basic earnings per common share		9,629		9,523		9,360
-diluted earnings per common share		9,710		9,605		9,474

See accompanying notes.

80

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - Years ended September 30

(In thousands)

		2014		2013	2012
Net income	$	10,019		15,385	7,808
Other comp. income (loss) net of tax:
Actuarial gain (loss) retiree health		(2	)	—	(6	)
Minimum pension liability		4		6	7
Comprehensive income	$	10,021		15,391	7,809

See accompanying notes.

81

CONSOLIDATED BALANCE SHEETS - As of September 30

(In thousands, except share data)

		2014	2013
Assets
Current assets:
Cash and cash equivalents	$	1,013	502
Cash held in escrow		61	1,569
Accounts receivable (net of allowance for doubtful
accounts of $155 and $162, respectively)		8,246	7,707
Real estate tax refund receivable		—	1,576
Inventory of parts and supplies		895	881
Prepaid tires on equipment		2,048	1,871
Prepaid taxes and licenses		2,436	2,223
Prepaid insurance		789	609
Prepaid expenses, other		83	79
Real estate held for sale, at cost		4,473	—
Total current assets		20,044	17,017
Property, plant and equipment, at cost:
Land		104,806	111,055
Buildings		166,324	151,812
Equipment		92,403	86,410
Construction in progress		8,971	7,058
		372,504	356,335
Less accumulated depreciation and depletion		122,894	114,922
		249,610	241,413
Real estate held for investment, at cost		7,304	4,343
Investment in joint ventures		18,537	13,406
Goodwill		3,431	1,087
Unrealized rents		4,780	4,659
Other assets		9,365	5,168
Total assets	$	313,071	287,093
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable	$	7,318	7,290
Deferred income taxes		239	127
Federal and state income taxes payable		701	475
Accrued payroll and benefits		4,568	6,008
Accrued insurance		1,186	1,285
Environmental remediation		1,771	—
Accrued liabilities, other		1,610	1,486
Long-term debt due within one year		4,534	4,311
Total current liabilities		21,927	20,982
Long-term debt, less current portion		58,704	45,593
Deferred income taxes		21,654	22,567
Accrued insurance		1,393	1,133
Other liabilities		3,078	4,172
Commitments and contingencies (Notes 12 and 13)		—	—
Shareholders' equity:
Preferred stock, no par value;
5,000,000 shares authorized; none issued
Common stock, $.10 par value;
25,000,000 shares authorized; 9,703,270 and 9,564,220
shares issued and outstanding, respectively		970	956
Capital in excess of par value		47,892	44,258
Retained earnings		157,413	147,394
Accumulated other comprehensive income, net		40	38
Total shareholders' equity		206,315	192,646
Total liabilities and shareholders' equity	$	313,071	287,093
See accompanying notes

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CONSOLIDATED STATEMENTS OF CASH FLOWS - Years ended September 30

(In thousands)		2014		2013			2012
Cash flows from operating activities:
Net income	$	10,019		15,385			7,808
Adjustments to reconcile net income to
net cash provided by continuing operating activities:
Depreciation, depletion and amortization		16,139			14,065			12,994
Deferred income taxes		(801	)		4,437			1,539
Equity in loss of joint ventures		128			63			8
Gain on sale of equipment and property		(1,063	)		(8,889	)		(2,332	)
Income from discontinued operations, net		—			—			(97	)
Stock-based compensation		1,139			883			701
Net changes in operating assets and liabilities:
Accounts receivable		1,037			47			(317	)
Inventory of parts and supplies		(14	)		(38	)		278
Prepaid expenses and other current assets		(298	)		1,340			(685	)
Other assets		(1,891	)		(1,595	)		(1,899	)
Accounts payable and accrued liabilities		(433	)		619			1,572
Income taxes payable and receivable		226			901			(333	)
Long-term insurance liabilities and other
long-term liabilities		(834	)		(340	)		1,070
Net cash provided by operating activities of
continuing operations		23,354			26,878			20,307
Net cash provided by operating
activities of discontinued operations		—			—			177
Net cash provided by operating activities		23,354			26,878			20,484
Cash flows from investing activities:
Purchase of transportation group property and equipment		(9,631	)		(15,612	)		(10,459	)
Investments in developed property rentals segment		(19,283	)		(22,936	)		(12,850	)
Investments in mining royalty land segment		—			—			(11,039	)
Transportation group business acquisition		(10,023	)		—			—
Investment in joint ventures		(5,266	)		(116	)		(125	)
Cash held in escrow		1,508			(1,569	)		—
Proceeds from the sale of real estate held for
investment, property, plant and equipment		3,324			17,708			2,817
Net cash used in investing activities		(39,371	)		(22,525	)		(31,656	)
Cash flows from financing activities:
Increase in bank overdrafts		685			248			—
Repayment of long-term debt		(4,311	)		(12,466	)		(4,902	)
Repurchase of Company Stock		—			(233	)		(315	)
Proceeds from borrowing on revolving credit facility		30,945		7,300			—
Payment on revolving credit facility		(13,300	)		(7,300	)		—
Excess tax benefits from exercises of stock
options and vesting of restricted stock		1,047			701			754
Exercise of employee stock options		1,462			1,186			1,322
Net cash provided by (used in) financing activities		16,528			(10,564	)		(3,141	)
Net increase(decrease)in cash and cash equivalents		511			(6,211	)		(14,313	)
Cash and cash equivalents at beginning of year		502			6,713			21,026
Cash and cash equivalents at end of the year	$	1,013			502			6,713
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest, net of capitalized amounts	$	1,475			2,520			2,638
Income taxes	$	6,180			3,803			3,717

The Company recorded non-cash transactions in 2012 for a $2,311 receivable on previously capitalized real estate taxes on the Anacostia property. The Company recorded a $334 non-cash transaction for accrued liabilities of deferred gains and post sale obligations related to investment land sold in 2013.

See accompanying notes.

83

CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY - Years ended September 30

(In thousands, except share amounts)

													Accumu-
													lated
													Other
													Compre-			Total
							Capital in						hensive			Share
	Common Stock						Excess of			Retained			Income, net			Holders
	Shares			Amount			Par Value			Earnings			of tax			Equity
Balance at October 1, 2011		9,288,023		$	929		$	38,845		$	124,642		$	31		$	164,447
Exercise of stock options		153,505			15			1,307									1,322
Excess tax benefits from
exercises of stock options
and vesting of restricted stock								811									811
Stock option compensation								324									324
Shares granted to Directors		15,000			1			319									320
Shares purchased and canceled		(15,908	)		(1	)		(67	)		(247	)					(315	)
Net income											7,808						7,808
Minimum pension liability,
net of $5 tax														7			7
Net actuarial loss retiree
health, net of $4 tax														(6	)		(6	)
Balance at September 30, 2012		9,440,620		$	944		$	41,539		$	132,203		$	32		$	174,718
Exercise of stock options		112,800			11			1,175									1,186
Excess tax benefits from
exercises of stock options
and vesting of restricted stock								701									701
Stock option compensation								376									376
Shares granted to Directors		19,500			2			505									507
Shares purchased and canceled		(8,700	)		(1	)		(38	)		(194	)					(233	)
Net income											15,385						15,385
Minimum pension liability,
net of $4 tax														6			6
Balance at September 30, 2013		9,564,220		$	956		$	44,258		$	147,394		$	38		$	192,646
Exercise of stock options		119,550			12			1,450									1,462
Excess tax benefits from
exercises of stock options
and vesting of restricted stock								1,047									1,047
Stock option compensation								441									441
Shares granted to Directors		19,500			2			696									698
Net income											10,019						10,019
Minimum pension liability,
net of $3 tax														4			4
Net actuarial loss retiree
health, net of $1 tax														(2	)		(2	)
Balance at September 30, 2014		9,703,270		$	970		$	47,892		$	157,413		$	40		$	206,315

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NOTES TO CONSOLDIATED FINANCIAL STATEMENTS

1. Accounting Policies.

ORGANIZATION - FRP Holdings, Inc. (Company) is engaged in the transportation and real estate businesses. The Company’s transportation business is conducted through its subsidiary, Florida Rock & Tank Lines, Inc. (Tank Lines). Tank Lines is a Southeastern transportation company concentrating in the hauling by motor carrier of primarily petroleum related bulk liquids and dry bulk commodities. The Company’s real estate group, through subsidiaries, acquires, constructs, leases, operates and manages land and buildings to generate both current cash flows and long-term capital appreciation. The real estate group also owns real estate that is leased under mining royalty agreements or held for investment.

CONSOLIDATION - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Investments in the Brooksville joint venture and Riverfront Investment Partner I, LLC are accounted for under the equity method of accounting (See Note 2). All significant intercompany transactions have been eliminated in consolidation.

CASH AND CASH EQUIVALENTS - The Company considers all highly liquid debt instruments with maturities of three months or less at time of purchase to be cash equivalents. Bank overdrafts consist of outstanding checks not yet presented to a bank for settlement, net of cash held in accounts with right of offset. Bank overdrafts of $933,000 and $248,000 are included in Accounts payable as of September 30, 2014 and 2013 respectively

INVENTORY - Inventory of parts and supplies is valued at the lower of cost (first-in, first-out) or market.

TIRES ON EQUIPMENT - The value of tires on tractors and trailers is accounted for as a prepaid expense and amortized over the life of the tires as a function of miles driven.

REVENUE AND EXPENSE RECOGNITION - Transportation revenue, including fuel surcharges, is recognized when the services have been rendered to customers or delivery has occurred, the pricing is fixed or determinable and collectibility is reasonably assured. Transportation expenses are recognized as incurred.

Real estate rental revenue and mining royalties are generally recognized when earned under the leases. Rental income from leases with scheduled increases or other incentives during their term is recognized on a straight-line basis over the term of the lease. Reimbursements of expenses, when provided in the lease, are recognized in the period that the expenses are incurred.

Sales of real estate are recognized when the collection of the sales price is reasonably assured and when the Company has fulfilled substantially all of its obligations, which are typically as of the closing date.

Accounts receivable are recorded net of discounts and provisions for estimated allowances. We estimate allowances on an ongoing basis by considering historical and current trends. We record estimated bad debts expense as a selling, general and administrative expense. We estimate the net collectibility of our accounts receivable and establish an allowance for doubtful accounts based upon this assessment. Specifically, we analyze the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms.

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PROPERTY AND EQUIPMENT - Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

                                Years

Buildings and improvements      7-39

Revenue equipment               7-10

Other equipment                 3-10

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves. Reserve estimates are periodically adjusted based upon surveys.

The Company recorded depreciation and depletion expenses for 2014, 2013 and 2012 of $14,426,000, $12,856,000, and $12,250,000, respectively.

All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property. Included in indirect costs is an allocation of internal costs associated with development of real estate investments. The cost of routine repairs and maintenance to property and equipment is expensed as incurred.

IMPAIRMENT OF LONG-LIVED ASSETS – The Company periodically reviews its long-lived assets, which include property and equipment and purchased intangible assets subject to amortization for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. The review of real estate group assets consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures. The review of the transportation segment assets consists of a review of future anticipated results considering business prospects and asset utilization. If the sum of these future cash flows (undiscounted and without interest charges) is less than the carrying amount of the assets, the Company would record an impairment loss based on the fair value of the assets with the fair value of the assets generally based upon an estimate of the discounted future cash flows expected with regards to the assets and their eventual disposition.

GOODWILL – Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in the acquisition of a business. Goodwill is not amortized, but rather is tested for impairment annually and when events or changes in circumstances indicate that the fair value of a reporting unit with goodwill has been reduced below carrying value. The impairment test requires allocating goodwill and other assets and liabilities to reporting units. The fair value of each reporting unit is determined and compared to the book value of the reporting unit. If the fair value of the reporting unit is less than the book value, including goodwill, then the recorded goodwill is impaired to its implied fair value with a charge to operating expense.

DEVELOPED PROPERTY RENTALS PURCHASE ACCOUNTING – Acquisitions of rental property, including any associated intangible assets, are measured at fair value at the date of acquisition. Any liabilities assumed or incurred are recorded at their fair value at the time of acquisition. The fair value of the acquired property is allocated between land and building (on an as-if vacant

86

basis) based on management’s estimate of the fair value of those components for each type of property and to tenant improvements based on the depreciated replacement cost of the tenant improvements, which approximates their fair value. The fair value of the in-place leases is recorded as follows:

· the fair value of leases in-place on the date of acquisition is based on absorption costs for the estimated lease-up period in which vacancy and foregone revenue are avoided due to the presence of the acquired leases;

· the fair value of above and below-market in-place leases based on the present value (using a discount rate that reflects the risks associated with the acquired leases) of the difference between contractual rent amounts to be paid under the assumed lease and the estimated market lease rates for the corresponding spaces over the remaining non-cancelable terms of the related leases; and

· the fair value of intangible tenant or customer relationships.

The Company’s determination of these fair values requires it to estimate market rents for each of the leases and make certain other assumptions. These estimates and assumptions affect the rental revenue, and depreciation and amortization expense recognized for these leases and associated intangible assets and liabilities.

INVESTMENTS - The Company uses the equity method to account for its investment in Brooksville, in which it has a voting interest of 50% and has significant influence but does not have control. The Company uses the equity method to account for its investment in Riverfront Investment Partners I, LLC, in which the equity interest will be determined based on leverage of the entity, additional cash contributions by the Company, and negotiations with potential third partners. Under the equity method, the investment is originally recorded at cost and adjusted to recognize the Company’s share of net earnings or losses of the investee, limited to the extent of the Company’s investment in and advances to the investee and financial guarantees on behalf of the investee that create additional basis. The Company regularly monitors and evaluates the realizable value of its investments. When assessing an investment for an other-than-temporary decline in value, the Company considers such factors as, the performance of the investee in relation to its own operating targets and its business plan, the investee’s revenue and cost trends, as well as liquidity and cash position, and the outlook for the overall industry in which the investee operates. From time to time, the Company may consider third party evaluations or valuation reports. If events and circumstances indicate that a decline in the value of these assets has occurred and is other-than-temporary, the Company records a charge to investment income (expense).

INSURANCE – The Company has a $250,000 to $500,000 self-insured retention per occurrence in connection with certain of its workers’ compensation, automobile liability, and general liability insurance programs ("risk insurance"). The Company is also self-insured for its employee health insurance benefits and carries stop loss coverage for losses over $250,000 per covered participant per year plus a $72,000 aggregate. The Company has established an accrued liability for the estimated cost in connection with its portion of its risk and health insurance losses incurred and reported. Claims paid by the Company are charged against the liability. Additionally, the Company maintains an accrued liability for incurred but not reported claims based on historical analysis of such claims. The method of calculating the accrual liability is subject to inherent uncertainty. If actual results are less favorable than the estimates used to calculate the liabilities, the Company would have to record expenses in excess of what has been accrued. Accrued insurance liabilities decreased due to payments to our new insurer under a captive agreement along with payment in

87

settlement of three unusually large prior year liability and health claims. Payments under the captive agreement are for the fiscal 2013 year-to-date loss fund as estimated in advance using actuarial methodology. The captive agreement provides that we will share in the underwriting results, good or bad, within a $250,000 per occurrence layer of loss through retrospective premium adjustments.

INCOME TAXES - Deferred tax assets and liabilities are recognized based on differences between financial statement and tax bases of assets and liabilities using presently enacted tax rates. Deferred income taxes result from temporary differences between pre-tax income reported in the financial statements and taxable income. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination of the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of limitations, effectively settled issues under audit, and audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. It is the Company's policy to recognize as additional income tax expense the items of interest and penalties directly related to income taxes.

STOCK BASED COMPENSATION – The Company accounts for compensation related to share based plans by recognizing the grant date fair value of stock options and other equity-based compensation issued to employees in its income statement over the requisite employee service period using the straight-line attribution model. In addition, compensation expense must be recognized for the change in fair value of any awards modified, repurchased or cancelled after the grant date. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used in the model and current year impact is discussed in Footnote 7.

PENSION PLAN - The Company accounts for its pension plan following the requirements of FASB ASC Topic 715, “Compensation – Retirement Benefits”, which requires an employer to: (a) recognize in its statement of financial position the funded status of a benefit plan; (b) measure defined benefit plan assets and obligations as of the end of the employer's fiscal year (with limited exceptions); and (c) recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise but are not recognized as components of net periodic benefit costs pursuant to prior existing guidance.

EARNINGS PER COMMON SHARE - Basic earnings per common share are based on the weighted average number of common shares outstanding during the periods. Diluted earnings per common share are based on the weighted average number of common shares and potential dilution of securities that could share in earnings. The differences between basic and diluted shares used for the calculation are the effect of employee and director stock options and restricted stock.

USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United State requires management to make estimates and assumptions that affect the reported amounts

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of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain accounting policies and estimates are of more significance in the financial statement preparation process than others. The most critical accounting policies and estimates include the economic useful lives and salvage values of our vehicles and equipment, provisions for uncollectible accounts receivable and collectibility of unrealized rents and notes receivable, estimates of exposures related to our insurance claims plans, and estimates for taxes. To the extent that actual, final outcomes are different than these estimates, or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting period will be affected.

ENVIRONMENTAL - Environmental expenditures that benefit future periods are capitalized. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded for the estimated amount of expected environmental assessments and/or remedial efforts. Estimation of such liabilities includes an assessment of engineering estimates, continually evolving governmental laws and standards, and potential involvement of other potentially responsible parties.

COMPREHENSIVE INCOME – Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) refers to expenses, gains, and losses that are not included in net income, but rather are recorded directly in shareholder’s equity.

RECENTLY ISSUED ACCOUNTING STANDARDS – In April 2014, the FASB issued ASU 2014-08, "Presentation of Financial Statements and Property, Plant, and Equipment - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." ASU 2014-08 changes the definition of a discontinued operation to include only those disposals of components of an entity that represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. The ASU also expands the disclosure requirements for transactions that meet the definition of a discontinued operation and requires entities to disclose information about individually significant components that are disposed of or held for sale and do not qualify as discontinued operations. This new guidance is effective for annual periods beginning on or after December 15, 2014 and interim periods within those years, with early adoption permitted. Effective second quarter 2014, the Company adopted ASU 2014-08 and will apply the new guidance, as applicable, to future disposals of components or classifications as held for sale.

2. Investment In Riverfront and Brooksville Joint Ventures.

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 a portion 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

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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 scheduled in 2016 and 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.

A subsidiary of the Company (FRP) has a Joint Venture Agreement with Vulcan Materials Company (formerly Florida Rock Industries, Inc.) to 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 the property until 2018 and pay royalties for the benefit of FRP for as long as mining does not interfere with the development of the property. Real estate revenues included $217,000 of such royalties in fiscal 2014 and $206,000 in fiscal 2013. Allocated depletion expense of $7,000 was included in real estate cost of operations for fiscal 2014. 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. The joint venture is jointly controlled by Vulcan and FRP, and they each had a mandatory obligation to fund additional capital contributions of up to $2,380,000. Capital contributions of $2,312,000 have been made by each party as of September 30, 2014. Distributions will be made on a 50-50 basis except for royalties and depletion specifically allocated to FRP. Other income for fiscal 2014 includes a loss of $39,000 representing the Company’s equity in the loss of the 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 in August 2012.

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 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	)
As of September 30, 2013
Riverfront Holdings I, LLC	88.82	%	$  5,894	$   7,745	$   (22	)	$   (22	)
Brooksville Quarry, LLC	50.00	%	7,512	14,356	(82	)	(41	)
Total			$ 13,406	$  22,101	$  (104	)	$   (63	)

Summarized Unaudited Financial Information for the Investments in Joint Ventures (in thousands):

	Years Ended September 30,
		2014		2013
Cash	$	208	$	18
Cash held in escrow		18,822		—
Amortizable Debt Costs		2,069		—
Investments in real estate, net.		27,088		22,083

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Total Assets	$	48,187	$	22,101
Other Liabilities	$	313	$	214
Long-term Debt		17,000		—
Capital - FRP		18,537		13,406
Capital - Third Parties		12,337		8,481
Total Liabilities and Capital	$	48,187	$	22,101

3. Debt.

Debt at September 30 is summarized as follows (in thousands):

	2014		2013
Revolving credit (uncollateralized)	$	17,645		—
5.6% to 8.6% mortgage notes
due in installments through 2027		45,593		49,904
		63,238		49,904
Less portion due within one year		4,534		4,311
	$	58,704		45,593

The aggregate amount of principal payments, excluding the revolving credit, due subsequent to September 30, 2014 is: 2015 - $4,534,000; 2016 – $4,616,000; 2017 - $4,887,000; 2018 - $4,674,000; 2019 - $3,885,000 and subsequent years - $22,997,000.

On December 21, 2012, the Company entered into a five year credit agreement with Wells Fargo Bank, N.A. with a maximum facility amount of $55 million (the "Credit Agreement"). The Credit Agreement provides a revolving credit facility (the “Revolver”) with a maximum facility amount of $40 million, with a $20 million sublimit for standby letters of credit, and a term loan facility of $15 million. As of September 30, 2014, $17,645,000 was borrowed under the Revolver, $5,421,000 in letters of credit was outstanding, and $31,934,000 was available for additional borrowing. The letters of credit were issued for insurance retentions and to guarantee certain obligations to state agencies related to real estate development. Most of the letters of credit are irrevocable for a period of one year and typically are automatically extended for additional one-year periods. The Revolver bears interest at a rate of 1.0% over the selected LIBOR, which may change quarterly based on the Company’s ratio of Consolidated Total Debt to Consolidated Total Capital, as defined. A commitment fee of 0.15% per annum is payable quarterly on the unused portion of the commitment. The commitment fee may also change quarterly based upon the ratio described above. The Credit Agreement contains certain conditions, affirmative financial covenants and negative covenants including limitations on paying cash dividends. As of September 30, 2014, $73,558,000 of consolidated retained earnings would be available for payment of dividends. The Company was in compliance with all covenants as of September 30, 2014.

The non-recourse fully amortizing mortgage notes payable are collateralized by real estate having a carrying value of approximately $57,146,000 at September 30, 2014.

During fiscal 2014, 2013 and 2012 the Company capitalized interest costs of $1,763,000, $1,863,000, and $1,646,000, respectively.

On June 3, 2013 the Company prepaid the $7,281,000 remaining principal balance on a 6.12% mortgage under an early prepayment provision the note allowed after

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7.5 years. The prepayment penalty of $382,000 is included in interest expense. The remaining deferred loan costs of $175,000 were also included in interest expense.

On July 31, 2013 the Company prepaid the $279,000 remaining principal balance on a 7.97% mortgage. The cost of the prepayment included a penalty of $7,000.

4. Leases.

At September 30, 2014, the total carrying value of property owned by the Company which is leased or held for lease to others is summarized as follows (in thousands):

Construction aggregates property	$	35,087
Commercial property		250,056
		285,143
less accumulated depreciation and depletion		66,920
	$	218,223

The minimum future straight-lined rentals due the Company on noncancelable leases as of September 30, 2014 are as follows: 2015 - $22,240,000; 2016 - $18,584,000; 2017 - $15,824,000; 2018 - $12,885,000; 2019 - $9,525,000; 2020 and subsequent years $33,804,000.

The Company leases certain assets under operating leases, which primarily consist of real estate leases for the corporate office and some of our terminal locations. Certain operating leases provide for renewal options, which can vary by lease and are typically offered at their fair rental value. The Company has not made any residual value guarantees related to its operating leases; therefore, there is no corresponding liability recorded on the Balance Sheets.

Future minimum annual lease payments for assets under operating leases as of September 30, 2014 are as follows (in thousands):

Fiscal Year	Total
2015	$	393
2016	278
2017	278
2018	278
2019	278
Thereafter	995
Total minimum lease payments	$	2,500

Aggregate expense under operating leases was $738,000, $634,000 and $583,000 for 2014, 2013 and 2012, respectively. Certain operating leases include rent escalation provisions, which are recognized as expense on a straight-line basis.

5. Spin-off.

On May 7, 2014, the Company announced that it planned to separate its transportation business into an independent publicly traded company through a tax free spin-off of the transportation business to FRP shareholders. The

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separation, which is subject to a number of conditions including final Board approval, receipt of an opinion of tax counsel and effectiveness of a registration statement on Form 10, is expected to be completed in the next 5 months.

6. Earnings Per Share.

The following details the computations of the basic and diluted earnings per common share. (Dollars in thousands, except per share amounts.)

	Years Ended September 30
	2014		2013		2012
Common shares:
Weighted average common shares
outstanding during the period -
shares used for basic earnings
per common share		9,629		9,523		9,360
Common shares issuable under share
based payment plans which are
potentially dilutive		81		82		114
Common shares used for diluted
earnings per common share		9,710		9,605		9,474
Net income	$	10,019		15,385		7,808
Earnings per common share
Basic	$	1.04		1.62		.83
Diluted	$	1.03		1.60		.82

For 2014, 2013 and 2012, 31,790, 87,550, and 164,560 shares, respectively, attributable to outstanding stock options were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.

7. Stock-Based Compensation Plans.

The Company has two Stock Option Plans (the 2000 Stock Option Plan and the 2006 Stock Option Plan) under which options for shares of common stock were granted to directors, officers and key employees. The 2006 plan permits the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, or stock awards. The options awarded under the plans have similar characteristics. All stock options are non-qualified and expire ten years from the date of grant. Stock based compensation awarded to directors, officers and employees are exercisable immediately or become exercisable in cumulative installments of 20% or 25% at the end of each year following the date of grant. When stock options are exercised the Company issues new shares after receipt of exercise proceeds and taxes due, if any, from the grantee. The number of common shares available for future issuance was 486,590 at September 30, 2014.

The Company utilizes the Black-Scholes valuation model for estimating fair value of stock compensation for options awarded to officers and employees. Each grant is evaluated based upon assumptions at the time of grant. The

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assumptions were no dividend yield, expected volatility between 37% and 46%, risk-free interest rate of .3% to 4.2% and expected life of 3.0 to 7.0 years.

The dividend yield of zero is based on the fact that the Company does not pay cash dividends and has no present intention to pay cash dividends. Expected volatility is estimated based on the Company’s historical experience over a period equivalent to the expected life in years. The risk-free interest rate is based on the U.S. Treasury constant maturity interest rate at the date of grant with a term consistent with the expected life of the options granted. The expected life calculation is based on the observed and expected time to exercise options by the employees.

The Company recorded the following stock compensation expense in its consolidated statement of income (in thousands):

	Years Ended September 30
	2014		2013		2012
Stock option grants	$	441		376		381
Annual non-employee Director stock award		698		507		320
	$	1,139		883		701

A summary of changes in outstanding options is presented below:

				Weighted		Weighted		Weighted
	Number			Average		Average		Average
	of			Exercise		Remaining		Grant Date
Options	Shares			Price		Term (yrs)		Fair Value(000's)
Outstanding at
October 1, 2011		606,025		$	14.96		3.5	$	4,216
Granted		31,690		$	22.25			$	281
Exercised		(153,505	)	$	8.62			$	(705	)
Forfeited		(3,000	)	$	5.78			$	(10	)
Outstanding at
September 30, 2012		481,210		$	17.52		3.8	$	3,782
Granted		46,180		$	26.20			$	489
Exercised		(112,800	)	$	10.52			$	(603	)
Forfeited		—		$	—			$	—
Outstanding at
September 30, 2013		414,590		$	20.40		4.2	$	3,668
Granted		31,790		$	41.39			$	545
Exercised		(119,550	)	$	12.23			$	(732	)
Forfeited		—		$	—			$	—
Outstanding at
September 30, 2014		326,830		$	25.43		5.0	$	3,481
Exercisable at
September 30, 2014		244,476		$	23.82		4.0	$	2,398
Vested during
twelve months ended
September 30, 2014		33,148						$	372

The following table summarizes information concerning stock options outstanding at September 30, 2014:

Shares  Weighted Weighted

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Range of Exercise	under	Average			Average
Prices per Share	Option	Exercise Price			Remaining Life
Non-exercisable:
$16.51 – $24.75	14,514			22.25		7.2
$24.76 - $37.25	43,550			26.62		7.5
$37.26 - $41.39	24,290			41.39		9.2
	82,354		$	30.21		8.0	years
Exercisable:
$11.00 - $16.50	55,800			14.92		0.4
$16.51 - $24.75	68,176			22.57		4.1
$24.76 - $37.25	113,000			27.79		5.3
$37.26 - $41.39	7,500			41.39		9.2
	244,476		$	23.82		4.0	years
Total	326,830		$	25.43		5.0	years

The aggregate intrinsic value of exercisable in-the-money options was $2,526,000 and the aggregate intrinsic value of outstanding in-the-money options was $3,014,000 based on the market closing price of $33.92 on September 30, 2014 less exercise prices. Gains of $2,918,000 were realized by option holders during the twelve months ended September 30, 2014. The realized tax benefit from options exercised for the twelve months ended September 30, 2014 was $1,129,000. Total compensation cost of options granted but not yet vested as of September 30, 2014 was $814,000, which is expected to be recognized over a weighted-average period of 3.3 years.

8. Income Taxes.

The provision for income taxes for continuing operations for fiscal years ended September 30 consists of the following (in thousands):

		2014		2013	2012
Current:
Federal	$	5,747		4,264	2,834
State		1,708		1,136	437
		7,455		5,400	3,271
Deferred		(803	)	4,437	1,538
Total	$	6,652		9,837	4,809

A reconciliation between the amount of tax shown above and the amount computed at the statutory Federal income tax rate follows (in thousands):

		2014	2013	2012
Amount computed at statutory
Federal rate	$	5,737	8,636	4,256
State income taxes (net of Federal
income tax benefit)		886	1,129	562
Other, net		29	72	(9	)
Provision for income taxes	$	6,652	9,837	4,809

In this reconciliation, the category “Other, net” consists of changes in

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unrecognized tax benefits, permanent tax differences related to non-deductible expenses, special tax rates and tax credits, interest and penalties, and adjustments to prior year estimates.

The types of temporary differences and their related tax effects that give rise to deferred tax assets and deferred tax liabilities at September 30, are presented below (in thousands):

		2014	2013
Deferred tax liabilities:
Property and equipment	$	22,496	22,650
Depletion		477	479
Unrealized rents		1,850	1,803
Prepaid expenses		1,447	1,306
Gross deferred tax liabilities		26,270	26,238
Deferred tax assets:
Insurance liabilities		819	786
Employee benefits and other		3,558	2,758
Gross deferred tax assets		4,377	3,544
Net deferred tax liability	$	21,893	22,694

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):

		2014	2013
Balance at October 1	$	—	—
Reductions due to lapse of statute of limitations		—	—
Balance at September 30	$	—	—

The Company files income tax returns in the U.S. and various states which are subject to audit for up to five years after filing.

9. Employee Benefits.

The Company and certain subsidiaries have a savings/profit sharing plan for the benefit of qualified employees. The savings feature of the plan incorporates the provisions of Section 401(k) of the Internal Revenue Code under which an eligible employee may elect to save a portion (within limits) of their compensation on a tax deferred basis. The Company contributes to a participant’s account an amount equal to 50% (with certain limits) of the participant’s contribution. Additionally, the Company may make an annual discretionary contribution to the plan as determined by the Board of Directors, with certain limitations. The plan provides for deferred vesting with benefits payable upon retirement or earlier termination of employment. The Company’s cost was $758,000 in 2014, $696,000 in 2013 and $669,000 in 2012.

The Company has a Management Security Plan (MSP) for certain officers and key employees. The accruals for future benefits are based upon the remaining years to retirement of the participating employees and other actuarial assumptions. The fourth quarter of fiscal 2014 includes a $575,000 unfavorable adjustment to the actuarially assumed expense due to the death prior to retirement of one of the plan participants. Life insurance on the lives of one of the participants has been purchased to partially fund this benefit and the Company is the owner and beneficiary of that policy. The expense for fiscal 2014, 2013 and 2012 was $764,000, $176,000 and $161,000, respectively. The accrued benefit under this plan as of September 30, 2014 and 2013 was $2,078,000 and $1,351,000

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respectively.

The Company provides certain health benefits for retired employees. Employees may become eligible for those benefits if they were employed by the Company prior to December 10, 1992, meet the service requirements and reach retirement age while working for the Company. The plan is contributory and unfunded. The Company accrues the estimated cost of retiree health benefits over the years that the employees render service. The accrued postretirement benefit obligation for this plan as of September 30, 2014 and 2013 was $370,000 and $357,000, respectively. The net periodic postretirement benefit cost was $12,000, $15,000 and $5,000 for fiscal 2014, 2013, and 2012, respectively. The discount rate used in determining the Net Periodic Postretirement Benefit Cost was 4.0% for 2014, 4.0% for 2013 and 4.0% for 2012. The discount rate used in determining the Accumulated Postretirement Benefit Obligation (APBO) was 4.25% for 2014, 4.0% for 2013 and 4.0% for 2012. No medical trend is applicable because the Company’s share of the cost is frozen.

10. Business Segments.

The Company operates in three reportable business segments. The Company’s operations are substantially in the Southeastern and Mid-Atlantic states.

The transportation segment hauls petroleum and other liquids and dry bulk commodities by tank trailers. The Company’s real estate operations consist of two reportable segments. The Mining royalty land segment owns real estate including construction aggregate royalty sites and parcels held for investment. The Developed property rentals segment acquires, constructs, and leases office/warehouse buildings primarily in the Baltimore/Northern Virginia/Washington area and holds real estate for future development or related to its developments.

The Company’s transportation and real estate groups operate independently and have minimal shared overhead except for corporate expenses. Corporate expenses are allocated in fixed quarterly amounts based upon budgeted and estimated proportionate cost by segment. Unallocated corporate expenses primarily include stock compensation and corporate aircraft expenses. Reclassifications to prior period amounts have been made to be comparable to the current presentation.

Operating results and certain other financial data for the Company’s business segments are as follows (in thousands):

		2014		2013		2012
Revenues:
Transportation	$	129,162		112,120		103,476
Mining royalty land		5,349		5,302		4,483
Developed property rentals		25,629		22,352		19,555
	$	160,140		139,774		127,514
Operating profit:
Transportation	$	8,027		11,119		9,107
Mining royalty land		4,736		4,739		3,905
Developed property rentals		10,228		9,427		5,497
Corporate expenses:
Allocated to transportation		(1,721	)	(1,765	)	(1,631	)
Allocated to mining land		(755	)	(731	)	(674	)
Allocated to developed property		(1,133	)	(1,094	)	(1,012	)
Unallocated		(1,614	)	(1,261	)	(1,091	)

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		(5,223	)	(4,851	)	(4,408	)
	$	17,768		20,434		14,101
Interest expense:
Mining royalty land	$	44		59		40
Developed property rentals		1,431		2,461		2,598
	$	1,475		2,520		2,638
Capital expenditures:
Transportation (a)	$	13,028		15,612		10,459
Mining royalty land		—		—		11,039
Developed property rentals:
Capitalized interest		1,763		1,863		1,646
Internal labor		469		418		609
Real estate taxes (b)		112		904		(1,209	)
Other costs		16,939		19,751		11,804
	$	32,311		38,548		34,348
(a)Includes $3,397 related to the Pipeline Transportation, Inc. acquisition during fiscal 2014. (b)Includes a $2,311 receivable on previously capitalized real estate
taxes on the Anacostia property for fiscal 2012.
Depreciation, depletion and
amortization:
Transportation	$	8,813		7,401		6,750
Mining royalty land		124		105		112
Developed property rentals		6,721		6,141		5,729
Other		481		418		403
	$	16,139		14,065		12,994
Identifiable net assets at September 30:
Transportation	$	59,465		49,410		42,642
Mining royalty land		39,368		40,008		39,695
Developed property rentals		211,556		195,476		184,358
Cash items		1,013		502		6,713
Unallocated corporate assets		1,669		1,697		2,297
		313,071		287,093		275,705

11. Fair Value Measurements.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. Level 1 means the use of quoted prices in active markets for identical assets or liabilities. Level 2 means the use of values that are derived principally from or corroborated by observable market data. Level 3 means the use of inputs are those that are unobservable and significant to the overall fair value measurement.

As of September 30, 2014 the Company had no assets or liabilities measured at fair value on a recurring or non-recurring basis. At September 30, 2014 and 2013, the carrying amount reported in the consolidated balance sheets for cash

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and cash equivalents, short-term notes payable and revolving credit approximate their fair value based upon the short-term nature of these items.

The fair values of the Company’s other mortgage notes payable were estimated based on current rates available to the Company for debt of the same remaining maturities. At September 30, 2014, the carrying amount and fair value of such other long-term debt was $63,238,000 and $67,081,000, respectively. At September 30, 2013, the carrying amount and fair value of such other long-term debt was $49,904,000 and $53,252,000, respectively.

12. Contingent Liabilities.

Certain of the Company’s subsidiaries are involved in litigation on a number of matters and are subject to certain claims which arise in the normal course of business. The Company has retained certain self-insurance risks with respect to losses for third party liability and property damage. There is a reasonable possibility that the Company’s estimate of vehicle and workers’ compensation liability for the transportation segment or discontinued operations may be understated or overstated but the possible range can not be estimated. The liability at any point in time depends upon the relative ages and amounts of the individual open claims. In the opinion of management, none of these matters are expected to have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows.

Preliminary testing on the site of the Company's four phase master development known as Riverfront on the Anacostia in Washington, D.C. indicated the presence of contaminated material that will have to be specially handled upon excavation in conjunction with construction. The Company has agreed with our joint venture partner to bear the cost of handling the contaminated materials on the first phase of this development up to a cap of $1.871 million. We recorded an expense in the fourth quarter of fiscal 2012 of $1,771,000 for this environmental remediation liability which is the lower end of the range of estimates. The Company has no obligation to remediate this contamination on Phases II, III and IV of the development until such time as it makes a commitment to commence construction there. The Company's position is that the prior tenant on the property is responsible for the cost of removal of the contaminated materials. The Company's actual expense to address this issue may be materially higher or lower than the expense previously recorded depending upon the actual costs incurred and any reimbursement that we receive from the prior tenant.

13. Commitments.

The Company, at September 30, 2014, had entered into various contracts to develop real estate with remaining commitments totaling $2,169,000, and to purchase transportation equipment for approximately $2,698,000.

14. Concentrations.

The transportation segment primarily serves customers in the petroleum industry in the Southeastern U.S. Significant economic disruption or downturn in this geographic region or these industries could have an adverse effect on our financial statements.

During fiscal 2014, the transportation segment’s ten largest customers accounted for approximately 54.7% of the transportation segment’s revenue. One

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of these customers accounted for 20.9% of the transportation segment’s revenue. The loss of any one of these customers would have an adverse effect on the Company’s revenues and income. Accounts receivable from the transportation segment’s ten largest customers was $4,075,000 and $3,565,000 at September 30, 2014 and 2013, respectively.

The mining royalty land segment has one lessee that accounted for 66.8% of the segment’s revenues and $216,000 of accounts receivable at September 30, 2014. The termination of certain of this lessee’s underlying leases could have a material adverse effect on the segment.

The Company places its cash and cash equivalents with high credit quality institutions. At times, such amounts may exceed FDIC limits.

15. Discontinued Operations.

In August 2009 the Company sold its flatbed trucking company, SunBelt Transport, Inc. ("SunBelt"). SunBelt has been accounted for as discontinued operations in accordance with ASC Topic 205-20 Presentation of Financial Statements – Discontinued Operations. All periods presented have been restated accordingly.

A summary of discontinued operations is as follows (in thousands):

		2014	2013	2012
Revenue	$	—	—	50
Operating expenses		—	—	(107	)
Gain on sale before taxes		—	—	—
Income before income taxes	$	—	—	157
Permanent tax benefit		—	—	—
Provision for taxes		—	—	(60	)
Income from discontinued operations	$	—	—	97

16. Real Estate Held for Sale.

The sale of phase two of the Windlass Run residential property is scheduled to close in March of 2015 for $11 million. The book value of the property was $4,473,000 as of September 30, 2014 and was classified as real estate held for sale as of September 30, 2014.

17. Unusual or Infrequent Items Impacting Quarterly Results.

Income from continuing operations for the first quarter of fiscal 2012 included a gain on termination of sale contract in the amount of $1,039,000 before income taxes for the receipt of non-refundable deposits related to the termination of an agreement to sell the Company’s Windlass Run Residential property.

Operating profit for the developed property rentals segment includes an expense in the fourth quarter of fiscal 2012 of $1,771,000 for an estimated environmental remediation liability which is the lower end of the range of estimates. The actual expense may be materially higher or lower depending upon the actual costs incurred and any reimbursement that we receive from the prior tenant.

In November 2012 the Company sold its Commonwealth property in Jacksonville,

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Florida resulting in gain of $1,116,000 before income taxes. The book value of the property was $723,000.

On June 3, 2013 the Company prepaid the $7,281,000 remaining principal balance on a 6.12% mortgage under an early prepayment provision the note allowed after 7.5 years. The prepayment penalty of $382,000 is included in interest expense. The remaining deferred loan costs of $175,000 were also included in interest expense. On July 31, 2013 the Company prepaid the $279,000 remaining principal balance on a 7.97% mortgage. The cost of the prepayment included a penalty of $7,000.

In July 2013 the Company sold 15.18 acres of land at Patriot Business Park for a sales price of $4,775,000 resulting in a gain of $341,000 before income taxes. The book value of the property was $3,603,000. At September 30, 2014 cash held in escrow included $61,000 related to future obligations of the Company pertaining to this sale which will be satisfied during fiscal 2015.

In August 2013 the Company sold 5.38 acres of land at Hollander 95 Business Park and recorded a gain before income taxes of $514,000. The book value of the property was $595,000. In August 2013 the Company sold phase 1 of the Windlass Run Residential property and recorded a gain of $4,928,000 before income taxes. The book value of the property was $2,971,000. The Company also sold 284 acres of Gulf Hammock mining property in August 2013 and recorded a gain of $433,000 before income taxes. The book value of the property was $296,000.

Sales, general & administrative expense for the fourth quarter of fiscal 2014 includes a $575,000 unfavorable adjustment to the actuarially assumed expense due to the death prior to retirement of one of the Management Security Plan participants.

18. Real Estate Business Park Acquisitions.

TRANSIT BUSINESS PARK - On June 20, 2013, the Company purchased for approximately $8 million, Transit Business Park in Baltimore, Maryland which consists of 5 buildings on 14.5 acres totaling 232,318 square feet. The Company has accounted for this acquisition in accordance with the provisions of ASC 805, Business Combinations (ASC 805). The Company has allocated the purchase price of the property, through the use of a third party valuation, based upon the fair value of the assets acquired, consisting of land, buildings and intangible assets, including inplace leases and below market leases. Based on the third party valuation performed, the purchase price has been allocated to the fair value of the in-place leases, above market leases and below market leases.  These deferred leasing intangible assets are recorded within Other assets and Other liabilities in the consolidated balance sheets. The value of the in-place lease intangibles will be amortized to amortization expense over the remaining lease terms. The fair value assigned pertaining to the above market in-place leases values are amortized as a reduction to rental revenue, and the below market in-place lease values are amortized as an increase to rental revenue over the remaining non-cancelable terms of the respective leases.

The Company will recognize the amortization related to Transit Business Park intangible assets according to the following schedule (in thousands):

		In-place	Above Market	Below Market
		Leases	Leases	Leases
Initial Values	$	806	48	156

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Annual Amortization:
2013	$	121	3	24
2014		369	12	86
2015		78	11	37
2016		64	11	9
2017		62	11	—
2018		35	—	—
2019		34	—	—
2020		34	—	—
2021		9	—	—

KELSO BUSINESS PARK - On June 6, 2014, the Company purchased for approximately $4.8 million, the Kelso property in Baltimore, Maryland which consists of 2 buildings on 10.2 acres totaling 69,680 square feet. The Company has accounted for this acquisition in accordance with the provisions of ASC 805, Business Combinations (ASC 805). The Company has allocated the purchase price of the property, through the use of a third party valuation, based upon the fair value of the assets acquired, consisting of land, buildings and intangible assets, including in-place leases and below market leases. Based on the third party valuation performed, $579,000 and $64,000 of the purchase price has been allocated to the fair value of the in-place leases and below market in-place leases, respectively. These intangible assets are recorded within Other assets and Other liabilities, respectively, in the consolidated balance sheets as of September 30, 2014. The value of the in-place lease intangibles will be amortized to amortization expense over the remaining lease term. The fair value assigned pertaining to the below-market in-place leases will be amortized to rental revenue over the remaining non-cancelable terms of the respective leases.

The Company will recognize the amortization related to Kelso Business Park intangible assets according to the following schedule (in thousands):

		In-place	Below Market
		Leases	Leases
Initial Values	$	579	64
Annual Amortization:
2014		80	8
2015		218	21
2016		133	21
2017		96	12
2018		25	2
2019		18	—
2020		9	—

19. Transportation Business Acquisition.

The Company’s transportation segment acquired certain assets of Pipeline Transportation, Inc. on November 7, 2013 for $10,023,000. Pipeline’s operations have been conducted in the Florida and Alabama markets. For the twelve month period ending June 30, 2013, Pipeline had gross revenues of just over $16,500,000.

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The Company has accounted for this acquisition in accordance with the provisions of ASC 805, Business Combinations (ASC 805). The Company has allocated the purchase price of the business, through the use of a third party valuations and management estimates, based upon the fair value of the assets acquired and liabilities assumed as follows (in thousands):

Consideration:
Fair value of consideration transferred (cash paid)	$	(10,023	)
Acquisition related costs expensed	$	75
Recognized amounts of identifiable assets acquired and            liabilities assumed:
Property and  equipment	$	3,397
Prepaid tires and other prepaid assets		276
Customer relationships		4,004
Trade name		72
Non-compete agreement		62
Vacation liability assumed		(132	)
Total identifiable net assets assumed	$	7,679
Goodwill		2,344
Total	$	10,023

The goodwill recorded resulting from the acquisition is tax deductible. The intangible assets acquired are reflected in the line Other assets, net on the consolidated balance sheets. In connection with the Pipeline acquisition, the Company assumed certain vehicle leases. As of September 30, 2014 these non-cancellable operating leases will require minimum annual rentals approximating $2,258,000 over the next 3.1 fiscal years.

Amortization expense for the transportation segment intangible assets was $380,000 for 2014 and it is included in sales, general and administrative expense. Estimated amortization expense for the five succeeding years follows (in thousands):

	Amount
2015	$	414
2016		414
2017		406
2018		394
2019		382
Total	$	2,010

20. Goodwill and Intangible Assets.

The changes in gross carrying amounts of goodwill are as follows (in thousands):

	Goodwill
September 30, 2012	$	1,087
No Activity		—
September 30, 2013		1,087
Goodwill acquired		2,344
September 30, 2014	$	3,431

103

The Company assesses goodwill for impairment on an annual basis in the fourth quarter, or more frequently if events or changes in circumstances indicate that the asset might be impaired.

The Company reviews intangible assets, including customer value, trade name and non-compete agreements, for impairment, whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of long-lived assets is measured by a comparison of the carrying amount of the asset group to the future undiscounted net cash flows expected to be generated by those assets. If such assets are considered to be impaired, the impairment charge recognized is the amount by which the carrying amounts of the assets exceeds the fair value of the assets.

The gross amounts and accumulated amortization of identifiable intangible assets are as follows (in thousands):

	September 30, 2014				September 30, 2013
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
In-place leases (useful life 7-8 years)	$	1,385	$	570	$	806	$	121
Above Market leases (useful life 5 years)		48		15		48		3
Customer value (useful life 10.5 years)		4,004		350
Trade name (useful life 5 years)		72		19
Non-compete (useful life 3.5 years)		62		11
	$	5,571	$	965	$	854	$	124

	September 30, 2014				September 30, 2013
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible liabilities:
Below Market leases (useful life 4-5 years)	$	220	$	118	$	156	$	24
	$	220	$	118	$	156	$	24

21. Subsequent Events.

In May 2014, we announced a plan to separate our transportation and real estate businesses through a tax-free spin-off of the transportation group. In order to facilitate the spin-off, we completed an internal corporate reorganization in December 2014 in which your shares of Patriot common stock were converted into an equal number of shares of common stock of our newly publicly traded holding company, FRP Holdings, Inc. For more information on the spin-off, see Item 1 “Business” of our Annual Report on Form 10-K.

104

Management's Report on Internal Control Over Financial Reporting

The management of FRP is responsible for establishing and maintaining adequate internal control over financial reporting. FRP's internal control system was designed to provide reasonable assurance to the Company's management and Board of Directors regarding the preparation and fair presentation of published financial statements in accordance with U.S. generally accepted accounting principles. All internal control systems, no matter how well designed have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. FRP's management assessed the effectiveness of the Company's internal control over financial reporting as of September 30, 2014 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in the Internal Control-Integrated Framework (2013). Based on this assessment, management believes that, as of September 30, 2014, the Company's internal control over financial reporting is effective.

Report of Independent Registered Certified Public Accounting Firm

The Shareholders and Board of Directors

FRP Holdings, Inc.

We have audited the accompanying consolidated balance sheets of FRP Holdings, Inc. as of September 30, 2014 and 2013, and the related consolidated statements of income, comprehensive income, shareholder’s equity, and cash flows for years ended September 30, 2014, 2013 and 2012. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of FRP Holdings, Inc. as of September 30, 2014 and 2013, and the consolidated results of its operations and its cash flows for the years ended September 30, 2014, 2013 and 2012 in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of FRP Holdings, Inc.’s internal control over financial reporting as of September 30, 2014, based on criteria established in the Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the

105

accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, FRP Holdings, Inc. maintained, in all material respects, effective internal control over financial reporting as of September 30, 2014, based on criteria established in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Hancock Askew & Co., LLP

December 3, 2014

Savannah, Georgia

106

DIRECTORS AND OFFICERS

Directors

Thompson S. Baker II (1)

President and Chief Executive

Officer of the Company

John D. Baker II (1)

Executive Chairman

Edward L. Baker (1)

Chairman Emeritus

John E. Anderson

Former President and Chief Executive

Officer of FRP Holdings, Inc.

Charles E. Commander III (2)(4)

Retired Partner

Foley & Lardner

Luke E. Fichthorn III

Private Investment Banker,

Twain Associates

Robert H. Paul III (2)(3)(4)

Chairman of the Board of

Southeast Atlantic Capital, LLC

H. W. Shad III (2)

Owner, Bozard Ford Company

Martin E. Stein, Jr. (3)(4)

Chairman and Chief Executive Officer of

Regency Centers Corporation

James H. Winston (3)

President of LPMC of Jax, Inc. and

Citadel Life & Health Insurance Co.

________________

(1) Member of the Executive Committee

(2) Member of the Audit Committee

(3) Member of the Compensation Committee

(4) Member of the Nominating Committee

107

Officers

John D. Baker II

Executive Chairman

Thompson S. Baker II

President and Chief Executive Officer

John D. Milton, Jr.

Executive Vice President, Treasurer, Secretary

and Chief Financial Officer

David H. deVilliers, Jr.

Vice President

President, FRP Development Corp. and

Florida Rock Properties, Inc.

John D. Klopfenstein

Controller and Chief Accounting Officer

Robert E. Sandlin

Vice President

President, Florida Rock & Tank Lines, Inc.

FRP Holdings, Inc.

200 West Forsyth Street, 7th Floor

Jacksonville, Florida, 32202

Telephone: (904) 396-5733

Annual Meeting

Shareholders are cordially invited to attend the Annual Shareholders Meeting which will be held at 10 a.m. local time, on Wednesday, February 4, 2015, at the Bank of America Tower, 42nd floor, 50 North Laura Street, Jacksonville, Florida, 32202.

Transfer Agent

American Stock Transfer & Trust Company

59 Maiden Lane

Plaza Level

New York, NY 10038

Telephone: 1-800-937-5449

108

General Counsel

Nelson Mullins Riley & Scarborough LLP

Jacksonville, Florida

Independent Registered Certified Public Accounting Firm

Hancock Askew & Co., LLP

Savannah, Georgia

Common Stock Listed

The Nasdaq Stock Market

(Symbol: FRPH)

Form 10-K

Shareholders may receive without charge a copy of FRP Holdings, Inc.’s annual report on Form 10-K for the fiscal year ended September 30, 2014 as filed with the Securities and Exchange Commission by writing to the Treasurer at 200 West Forsyth Street, 7th Floor, Jacksonville, Florida 32202. The most recent certifications by our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are filed as exhibits to our Form 10-K.

Company Website

The Company’s website may be accessed at www.patriottrans.com. All of our filings with the Securities and Exchange Commission can be accessed through our website promptly after filing. This includes annual reports on Form 10-K, proxy statements, quarterly reports on Form 10-Q, current reports filed or furnished on Form 8-K and all related amendments.

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-55132, 333-125099 and 333-131475) of FRP Holdings, Inc. of our report dated December 3, 2014 relating to the consolidated financial statements and the effectiveness of FRP Holdings, Inc’s internal control over financial reporting which appears in the Annual Report to Shareholders incorporated by reference herein. We also consent to the incorporation by reference of our report dated December 3, 2014, relating to the financial statement schedules, which appear in this Form 10-K.

Hancock Askew & Co., LLP

Savannah, Georgia

December 3, 2014

EX-31

CERTIFICATIONS                                              Exhibit 31(a)

I, Thompson S. Baker II, certify that:

1. I have reviewed this annual report on Form 10-K of FRP Holdings, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls to be designed under our supervision, ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosures controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal annual that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial report; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 3, 2014                      /s/Thompson S. Baker II

                                          President and Chief Executive

                                          Officer

EX-31

CERTIFICATIONS Exhibit                                              31(b)

I, John D. Milton, Jr., certify that:

1. I have reviewed this annual report on Form 10-K of FRP Holdings, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls to be designed under our supervision, ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosures controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal annual that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial report; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 3, 2014                          /s/John D. Milton, Jr.

                                              Executive Vice President,

                                              Treasurer,Secretary and

                                              Chief Financial Officer

EX-31

CERTIFICATIONS Exhibit                                              31(c)

I, John D. Klopfenstein, certify that:

1. I have reviewed this annual report on Form 10-K of FRP Holdings, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls to be designed under our supervision, ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosures controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal annual that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial report; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 3, 2014                    /s/John D. Klopfenstein

                                        Controller and Chief Accounting

                                        Officer

EX-32

Exhibit 32

CERTIFICATION UNDER SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned certifies that this periodic report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in this periodic report fairly presents, in all material respects, the financial condition and results of operations of FRP Holdings, Inc.

                                   FRP HOLDINGS, INC.

December 3, 2014                   THOMPSON S. BAKER II_______________

                                 Thompson S. Baker II

                                 President and Chief Executive Officer

                                 JOHN D. MILTON, JR.__________

                                 John D. Milton, Jr.

                                 Executive Vice President, Treasurer, Secretary                                    and Chief Financial Officer

                                 JOHN D. KLOPFENSTEIN___________

                                 John D. Klopfenstein

                                 Controller and Chief

                                 Accounting Officer

A signed original of this written statement required by Section 906 has been provided to FRP Holdings, Inc. and will be retained by FRP Holdings, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification accompanies the issuer’s Annual Report on Form 10-K and is not filed as provided in SEC Release Nos. 33-8212, 34-4751 and IC-25967, dated June 30, 2003.

XML

Business Segments (Tables)

12 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

Business Segments

(in thousands)		2014		2013		2012
Revenues:
Transportation	$	129,162		112,120		103,476
Mining royalty land		5,349		5,302		4,483
Developed property rentals		25,629		22,352		19,555
	$	160,140		139,774		127,514
Operating profit:
Transportation	$	8,027		11,119		9,107
Mining royalty land		4,736		4,739		3,905
Developed property rentals		10,228		9,427		5,497
Corporate expenses:
Allocated to transportation		(1,721	)	(1,765	)	(1,631	)
Allocated to mining land		(755	)	(731	)	(674	)
Allocated to developed property		(1,133	)	(1,094	)	(1,012	)
Unallocated		(1,614	)	(1,261	)	(1,091	)
		(5,223	)	(4,851	)	(4,408	)
	$	17,768		20,434		14,101
Interest expense:
Mining royalty land	$	44		59		40
Developed property rentals		1,431		2,461		2,598
	$	1,475		2,520		2,638
Capital expenditures:
Transportation (a)	$	13,028		15,612		10,459
Mining royalty land		—		—		11,039
Developed property rentals:
Capitalized interest		1,763		1,863		1,646
Internal labor		469		418		609
Real estate taxes (b)		112		904		(1,209	)
Other costs		16,939		19,751		11,804
	$	32,311		38,548		34,348
(a)Includes $3,397 related to the Pipeline Transportation, Inc.    acquisition during fiscal 2014. (b)Includes a $2,311 receivable on previously capitalized real estate
taxes on the Anacostia property for fiscal 2012.
Depreciation, depletion and
amortization:
Transportation	$	8,813		7,401		6,750
Mining royalty land		124		105		112
Developed property rentals		6,721		6,141		5,729
Other		481		418		403
	$	16,139		14,065		12,994
Identifiable net assets at September 30:
Transportation	$	59,465		49,410		42,642
Mining royalty land		39,368		40,008		39,695
Developed property rentals		211,556		195,476		184,358
Cash items		1,013		502		6,713
Unallocated corporate assets		1,669		1,697		2,297
		313,071		287,093		275,705

XML

Income Taxes - Temporary differences (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Sep. 30, 2013
Income Tax Disclosure [Abstract]
Property and equipment	$ 22,496	$ 22,650
Depletion	477	479
Unrealized rents	1,850	1,803
Prepaid expenses	1,447	1,306
Gross deferred tax liabilities	26,270	26,238
Insurance liabilities	819	786
Employee benefits and other	3,558	2,758
Gross deferred tax assets	4,377	3,544
Net deferred tax liability	$ 21,893	$ 22,694

XML

Leases - Minimum annual operating lease payments (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014
Leases - Minimum Annual Operating Lease Payments Details
Future minimum operating lease payments 2015	$ 393
Future minimum operating lease payments 2016	278
Future minimum operating lease payments 2017	278
Future minimum operating lease payments 2018	278
Future minimum operating lease payments 2019	278
Future minimum operating lease payments therafter	995
Total Minimum operating lease payments	$ 2,500

XML

Leases (Details Narrative) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Leases [Abstract]
Minimum future straight-lined rentals due on noncancelable leases 2015	$ 22,240
Minimum future straight-lined rentals due on noncancelable leases 2016	18,584
Minimum future straight-lined rentals due on noncancelable leases 2017	15,824
Minimum future straight-lined rentals due on noncancelable leases 2018	12,885
Minimum future straight-lined rentals due on noncancelable leases 2019	9,525
Minimum future straight-lined rentals due on noncancelable leases 2020 and subsequent years	33,804
Aggregate expense under operating leases	$ 738	$ 634	$ 583

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Income Taxes - Unrecognized tax benefits (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Income Tax Disclosure [Abstract]
Unrecognized tax benefits at October 1	$ 0	$ 0
Reductions due to lapse of statute of limitations	0	0
Unrecognized tax benefits at September 30	$ 0	$ 0

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Concentrations (Details Narrative) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Transportation Top Ten Customers
Customer revenue concentration	54.70%
Accounts receivable concentration	$ 4,075	$ 3,565
Transportation Top Customer
Customer revenue concentration	20.90%
Mining Top Customer
Customer revenue concentration	66.80%
Accounts receivable concentration	$ 216

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Debt - Debt (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Sep. 30, 2013
Debt Disclosure [Abstract]
Revolving credit (uncollateralized)	$ 17,645	$ 0
5.6% to 8.6% mortgage notes due in installments through 2027	45,593	49,904
Less portion due within one year	4,534	4,311
[LongTermDebtNoncurrent]	$ 58,704	$ 45,593

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Investment in Riverfront and Brooksville Joint Ventures (Tables)

12 Months Ended

Sep. 30, 2014

Equity Method Investments and Joint Ventures [Abstract]

Investments in Joint Ventures

							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 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	)
As of September 30, 2013
Riverfront Holdings I, LLC	88.82	%	$  5,894	$   7,745	$   (22	)	$   (22	)
Brooksville Quarry, LLC	50.00	%	7,512	14,356	(82	)	(41	)
Total			$ 13,406	$  22,101	$  (104	)	$   (63	)

Unaudited Financial Information for the Investments in Joint Ventures

(in thousands)	Years Ended September 30,
		2014		2013
Cash	$	208	$	18
Cash held in escrow		18,822		—
Amortizable Debt Costs		2,069		—
Investments in real estate, net.		27,088		22,083
Total Assets	$	48,187	$	22,101
Other Liabilities	$	313	$	214
Long-term Debt		17,000		—
Capital - FRP		18,537		13,406
Capital - Third Parties		12,337		8,481
Total Liabilities and Capital	$	48,187	$	22,101

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Real Estate Held for Sale (Details Narrative) (USD $) In Thousands, unless otherwise specified					1 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2011	Mar. 31, 2015 Windlass Run	Sep. 30, 2014 Windlass Run
Sales price					$ 11,000
Book value of property held for sale	$ 286,671	$ 268,932	$ 262,564	$ 241,253		$ 4,473

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Employee Benefits (Details Narrative) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Notes to Financial Statements
Compay 401k contribution	50.00%
Savings/profit sharing plan company contribution	$ 758	$ 696	$ 669
Management Security Plan expense	764	176	161
Management Security Plan adjustment	575
Management Security Plan accrued benefit	2,078	1,351
Accrued postretirement benefit obligation	370	357
Net periodic postretirement benefit cost	$ 12	$ 15	$ 5
Net periodic postretirement benefit cost discount rate	4.00%	4.00%	4.00%
Accumulated postretirement benefit obligation discount rate	4.25%	4.00%	4.00%

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Discontinued Operations - Summary of Discontinued Operations (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Discontinued Operations and Disposal Groups [Abstract]
Revenue	$ 0	$ 0	$ 50
Operating expenses	0	0	(107)
Gain on sale before taxes	0	0	0
Income before income taxes	0	0	157
Permanent tax benefit	0	0	0
Provision for income taxes	0	0	(60)
Income from discontinued operations	$ 0	$ 0	$ 97

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Contingent Liabilities (Details Narrative) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Sep. 30, 2012	Sep. 30, 2014
Contingent Liabilities Details Narrative
Cap on environment financial responsibility		$ 1,871
Environmental remediation	$ 1,771

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Real Estate Business Park Acquisition (Details Narrative) (USD $) In Thousands, unless otherwise specified	Jun. 20, 2013 Transit Business Park sqft	Jun. 06, 2014 Kelso Business Park sqft
Approximate purchase price	$ 8,000	$ 4,800
Number of buildings Transit Business Park	5	2
Land acreage	14.5	10.2
Square feet	232,318	69,680
In-place leases	806	579
Below market in-place leases	$ 156	$ 64

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Commitments (Details Narrative) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014
Transportation
Purchase commitments	$ 2,698
Developed property rentals
Purchase commitments	$ 2,169

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Earnings Per Share (Details Narrative)	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Earnings Per Share [Abstract]
Anti-dilutive shares	31,790	87,550	164,560

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Real Estate Held for Sale

12 Months Ended

Sep. 30, 2014

Notes to Financial Statements

Real Estate Held for Sale

16. Real Estate Held for Sale.

The sale of phase two of the Windlass Run residential property is scheduled to close in March of 2015 for $11 million. The book value of the property was $4,473,000 as of September 30, 2014 and was classified as real estate held for sale as of September 30, 2014.

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Stock-Based Compensation Plans - Stock Compensation Expense (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock option grants	$ 441	$ 376	$ 381
Annual non-employee Director stock award	698	507	320
Total Stock Compensation expense	$ 1,139	$ 883	$ 701

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Transportation Business Acquisition (Tables)

12 Months Ended

Sep. 30, 2014

Transportation Business Acquisition

Consideration:
Fair value of consideration transferred (cash paid)	$	(10,023	)
Acquisition related costs expensed	$	75
Recognized amounts of identifiable assets acquired and            liabilities assumed:
Property and  equipment	$	3,397
Prepaid tires and other prepaid assets		276
Customer relationships		4,004
Trade name		72
Non-compete agreement		62
Vacation liability assumed		(132	)
Total identifiable net assets assumed	$	7,679
Goodwill		2,344
Total	$	10,023

Transportation Business Acquisition

Transportation segment intangible asset amortization expense

	Amount
2015	$	414
2016		414
2017		406
2018		394
2019		382
Total	$	2,010

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Fair Value Measurements (Details Narrative) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Sep. 30, 2013
Fair Value Disclosures [Abstract]
Assets measured at fair value on a recurring basis	$ 0
Liabilities measured at fair value on a recurring basis	0
Assets measured at fair value on a non-recurring basis	0
Liabilities measured at fair value on a non-recurring basis	0
Carrying amount of other long-term debt	63,238	49,904
Fair value of other long-term debt	$ 67,081	$ 53,252

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Stock-Based Compensation Plans (Tables)

12 Months Ended

Sep. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Compensation Expense

(in thousands)	Years Ended September 30
	2014		2013		2012
Stock option grants	$	441		376		381
Annual non-employee Director stock award		698		507		320
	$	1,139		883		701

Summary of Stock Activity

				Weighted		Weighted		Weighted
	Number			Average		Average		Average
	of			Exercise		Remaining		Grant Date
Options	Shares			Price		Term (yrs)		Fair Value(000's)
Outstanding at
October 1, 2011		606,025		$	14.96		3.5	$	4,216
Granted		31,690		$	22.25			$	281
Exercised		(153,505	)	$	8.62			$	(705	)
Forfeited		(3,000	)	$	5.78			$	(10	)
Outstanding at
September 30, 2012		481,210		$	17.52		3.8	$	3,782
Granted		46,180		$	26.20			$	489
Exercised		(112,800	)	$	10.52			$	(603	)
Forfeited		—		$	—			$	—
Outstanding at
September 30, 2013		414,590		$	20.40		4.2	$	3,668
Granted		31,790		$	41.39			$	545
Exercised		(119,550	)	$	12.23			$	(732	)
Forfeited		—		$	—			$	—
Outstanding at
September 30, 2014		326,830		$	25.43		5.0	$	3,481
Exercisable at
September 30, 2014		244,476		$	23.82		4.0	$	2,398
Vested during
twelve months ended
September 30, 2014		33,148						$	372

Summary of Stock Options Outstanding

	Shares	Weighted			Weighted
Range of Exercise	under	Average			Average
Prices per Share	Option	Exercise Price			Remaining Life
Non-exercisable:
$16.51 – $24.75	14,514			22.25		7.2
$24.76 - $37.25	43,550			26.62		7.5
$37.26 - $41.39	24,290			41.39		9.2
	82,354		$	30.21		8.0	years
Exercisable:
$11.00 - $16.50	55,800			14.92		0.4
$16.51 - $24.75	68,176			22.57		4.1
$24.76 - $37.25	113,000			27.79		5.3
$37.26 - $41.39	7,500			41.39		9.2
	244,476		$	23.82		4.0	years
Total	326,830		$	25.43		5.0	years

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Stock-Based Compensation Plans - Summary of Stock Options Outstanding (Details) (USD $)	12 Months Ended
	Sep. 30, 2014 Years
Shares under option	326,830
Weighted average exercise price	$ 25.43
Weighted average remaining life	5.0
Options exercisable at September 30, 2014	244,476
$11.00 - $16.50
Shares under option	55,800
Weighted average exercise price	$ 14.92
Weighted average remaining life	0.4
Minimum exercise price	$ 11.00
Maximum exercise price	$ 16.50
$16.51 - $24.75
Shares under option	68,176
Weighted average exercise price	$ 22.57
Weighted average remaining life	4.1
Minimum exercise price	$ 16.51
Maximum exercise price	$ 24.75
$24.76 - $37.25
Shares under option	113,000
Weighted average exercise price	$ 27.79
Weighted average remaining life	5.3
$37.26 - $41.39
Shares under option	7,500
Weighted average exercise price	$ 41.39
Weighted average remaining life	9.2
Minimum exercise price	$ 37.26
Maximum exercise price	$ 41.39
$16.51 - $24.75 Non-exercisable
Shares under option	14,514
Weighted average exercise price non-exercisable	$ 22.25
Weighted average remaining life	7.2
Minimum exercise price	$ 16.51
Maximum exercise price	$ 24.75
$24.76 - $37.25 Non-exercisable
Shares under option	43,550
Weighted average exercise price non-exercisable	$ 26.62
Weighted average remaining life	7.5
Minimum exercise price	$ 24.76
Maximum exercise price	$ 37.25
$37.26 - $41.39 Non-exercisable
Shares under option	24,290
Weighted average exercise price non-exercisable	$ 41.39
Weighted average remaining life	9.2
Non-exercisable
Shares under option	82,354
Weighted average exercise price non-exercisable	$ 30.21
Weighted average remaining life	8.0
$24.76 - $37.25
Minimum exercise price	$ 24.76
Maximum exercise price	$ 37.25
$37.26 - $41.39 Non-exercisable
Minimum exercise price	$ 37.26
Maximum exercise price	$ 41.39

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Accounting Policies (Details Narrative) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Bank overdrafts	$ 933	$ 248
Brooksville joint venture owned	50.00%	50.00%	50.00%
Depreciation and depletion	14,426	12,856	12,250
Self insurance retention	$250,000 to $500,000	$250,000 to $500,000	$250,000 to $500,000
Health insurance aggregate	$ 72	$ 72	$ 72
Buildings and improvements
Estimated useful lives	7-39
Revenue equipment
Estimated useful lives	7-10
Other equipment
Estimated useful lives	3-10

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Transportation segment intangible assets (Details) (Transportation Business Acquisition, USD $) In Thousands, unless otherwise specified	Sep. 30, 2014
Transportation Business Acquisition
Amortization of intangible assets 2015	$ 414
Amortization of intangible assets 2016	414
Amortization of intangible assets 2017	406
Amortization of intangible assets 2018	394
Amortization of intangible assets 2019	382
Total amortization expense for the next five years	$ 2,010

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Leases - Property leased or held for lease (Details) (Property leased or held for lease, USD $) In Thousands, unless otherwise specified	Sep. 30, 2014
Property leased or held for lease
Construction aggregates property	$ 35,087
Commercial property	250,056
Carrying Value of property owned by the Company leased or held for lease, gross	285,143
Less accumulated depreciation and depletion	66,920
Carrying Value of property owned by the Company leased or held for lease, net	$ 218,223

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Consolidated Real Estate and Accumulated Depreciation and Depletion

12 Months Ended

Sep. 30, 2014

Real Estate [Abstract]

Consolidated Real Estate and Accumulated Depreciation and Depletion

FRP HOLDINGS, INC.
SCHEDULE III (CONSOLIDATED) - REAL ESTATE & ACCUMULATED DEPRECIATION AND DEPLETION
(dollars in thousands)
SEPTEMBER 30, 2014
					Cost			Gross amount				Year				Depreciation
	Encumb-		Initial Cost		capitalized			at which		Accumulated		of		Date		Life
County	rances		to		subsequent			carried at		Depreciation		Construct-		Acquired		Computed
			Company		to			end of		& Depletion		ion				on:
					acquisition			period(a)
Construction Aggregates
Alachua, FL	$	—	$	1,442	$	—		$	1,442	$	142		n/a		4/86		unit
Clayton, GA		—		369		—			369		5		n/a		4/86		unit
Fayette, GA		—		685		—			685		64		n/a		4/86		unit
Lake, FL		—		402		—			402		146		n/a		4/86		unit
Lake Louisa, FL		—		11,039		—			11,039		—		n/a		5/12		unit
Lee, FL		—		4,690		6			4,696		6		n/a		4/86		unit
Monroe, GA		—		792		—			792		283		n/a		4/86		unit
Muscogee, GA		—		369		(45	)		324		313		n/a		4/86		unit
Prince Wil., VA		—		299		—			299		299		n/a		4/86		unit
Putnam, FL		—		15,002		37			15,039		4,375		n/a		4/86		unit
		—		35,089		(2	)		35,087		5,633
Other Rental Property
Wash D.C.		—		2,957		10,307			13,264		2,547		n/a		4/86		15 yr
Wash D.C.		—		3,811		—			3,811		—		n/a		10/97		n/a
Putnam, FL		—		302		(2	)		300		283		n/a		4/86		5 yr
Spalding, GA		—		20		—			20		—		n/a		4/86		n/a
Lake, FL		—		1,083		—			1,083		968		n/a		4/86		unit
Marion, FL		—		1,180		4			1,184		599		n/a		4/86		unit
		—		9,353		10,309			19,662		4,397
Commercial Property
Baltimore, MD		1,912		439		4,662			5,101		2,650		1990		10/89		39 yr
Baltimore, MD		3,909		950		7,324			8,274		4,389		1994		12/91		39 yr
Baltimore, MD		1,329		690		2,861			3,551		1,436		2000		7/99		39 yr
Baltimore, MD		—		5,634		11,504			17,138		810		2008		12/02		39 yr
Baltimore, MD		—		4,309		218			4,527		38		n/a		6/14		39 yr
Baltimore City, MD		—		5,750		5,609			11,359		678		2010		12/10		39 yr
Baltimore City, MD		—		7,442		834			8,276		396		n/a		6/13		39 yr
Duval, FL		—		2,416		541			2,957		2,752		n/a		4/86		25 yr
Harford, MD		974		31		3,830			3,861		2,009		1998		8/95		39 yr
Harford, MD		2,088		50		5,699			5,749		2,377		1999		8/95		39 yr
Harford, MD		3,433		85		7,091			7,176		3,345		2001		8/95		39 yr
Harford, MD		—		92		1,509			1,601		—		n/a		8/95		39 yr
Harford, MD		2,645		88		10,133			10,221		3,819		2007		8/95		39 yr
Harford, MD		1,954		155		12,337			12,492		3,605		2009		8/95		39 yr
Howard, MD		1,272		2,859		4,778			7,637		4,010		1996		9/88		39 yr
Howard, MD		1,201		2,473		981			3,454		1,327		2000		3/00		39 yr
Anne Arun, MD		—		715		9,211			9,926		5,365		1989		9/88		39 yr
Anne Arun, MD		6,546		950		13,120			14,070		4,484		2003		5/98		39 yr
Anne Arun, MD		—		1,525		10,800			12,325		3,088		2005		8/04		39 yr
Anne Arun, MD		3,816		737		5,341			6,078		1,521		2006		1/03		39 yr
Anne Arun, MD		—		667		10,259			10,926		2,001		2012		7/07		39 yr
Norfolk, VA		5,305		7,512		—			7,512		2,224		2004		10/04		39 yr
Prince Wil., VA		—		7,324		27,508			34,832		690		n/a		12/05		39 yr
Newcastle Co., DE		9,209		11,559		2,757			14,316		3,876		2004		4/04		39 yr
Carroll, MD		—		4,720		2,315			7,035		—		n/a		3/08		n/a
		45,593		69,172		161,222			230,394		56,890
Investment Property		—		1,629		(101	)		1,528		678		n/a		4/86		n/a
GRAND TOTALS	$	45,593	$	115,243	$	171,428		$	286,671	$	67,598
(a) The aggregate cost for Federal income tax purposes is $252,925.

FRP HOLDINGS, INC.
SCHEDULE III (CONSOLIDATED) - REAL ESTATE AND
ACCUMULATED DEPRECIATION AND DEPLETION
YEARS ENDED SEPTEMBER 30, 2014, 2013 AND 2012
(In thousands)
	2014		2013		2012
Gross Carrying Cost of Real Estate:
Balance at beginning of period	268,932		262,564		241,253
Additions during period:
Amounts capitalized	19,154		22,228		21,380
Deductions during period:
Cost of real estate sold	(1,415	)	(10,021	)	(69	)
Other	—		(5,839	)	—
Balance at close of period	286,671		268,932		262,564
Accumulated Depreciation & Depletion:
Balance at beginning of period	62,167		58,997		54,110
Additions during period:
Charged to cost & expense	5,446		4,938		4,956
Deductions during period:
Real estate sold	(15	)	(461	)	(69	)
Other	—		(1,307	)	—
Balance at close of period	67,598		62,167		58,997

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Carrying Amount of Goodwill (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013
Carrying Amount Of Goodwill Details
Beginning Balance Goodwill	$ 1,087	$ 1,087
Acquisitions	2,344	0
Ending Balance Goodwill	$ 3,431	$ 1,087

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

	Goodwill
September 30, 2012	$	1,087
No Activity		—
September 30, 2013		1,087
Goodwill acquired		2,344
September 30, 2014	$	3,431

Amortizable intangible assets

	September 30, 2014				September 30, 2013
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
In-place leases (useful life 7-8 years)	$	1,385	$	570	$	806	$	121
Above Market leases (useful life 5 years)		48		15		48		3
Customer value (useful life 10.5 years)		4,004		350
Trade name (useful life 5 years)		72		19
Non-compete (useful life 3.5 years)		62		11
	$	5,571	$	965	$	854	$	124

Amortizable intangible liabilities

	September 30, 2014				September 30, 2013
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible liabilities:
Below Market leases (useful life 4-5 years)	$	220	$	118	$	156	$	24
	$	220	$	118	$	156	$	24

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Goodwill and Intangible Assets

12 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

20. Goodwill and Intangible Assets.

The changes in gross carrying amounts of goodwill are as follows (in thousands):

	Goodwill
September 30, 2012	$	1,087
No Activity		—
September 30, 2013		1,087
Goodwill acquired		2,344
September 30, 2014	$	3,431

The Company assesses goodwill for impairment on an annual basis in the fourth quarter, or more frequently if events or changes in circumstances indicate that the asset might be impaired.

The Company reviews intangible assets, including customer value, trade name and non-compete agreements, for impairment, whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of long-lived assets is measured by a comparison of the carrying amount of the asset group to the future undiscounted net cash flows expected to be generated by those assets. If such assets are considered to be impaired, the impairment charge recognized is the amount by which the carrying amounts of the assets exceeds the fair value of the assets.

The gross amounts and accumulated amortization of identifiable intangible assets are as follows (in thousands):

	September 30, 2014				September 30, 2013
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
In-place leases (useful life 7-8 years)	$	1,385	$	570	$	806	$	121
Above Market leases (useful life 5 years)		48		15		48		3
Customer value (useful life 10.5 years)		4,004		350
Trade name (useful life 5 years)		72		19
Non-compete (useful life 3.5 years)		62		11
	$	5,571	$	965	$	854	$	124

	September 30, 2014				September 30, 2013
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible liabilities:
Below Market leases (useful life 4-5 years)	$	220	$	118	$	156	$	24
	$	220	$	118	$	156	$	24

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Transportation Business Acquisition

12 Months Ended

Sep. 30, 2014

Business Combinations [Abstract]

Transportation Business Acquisition

19. Transportation Business Acquisition.

The Company’s transportation segment acquired certain assets of Pipeline Transportation, Inc. on November 7, 2013 for $10,023,000. Pipeline’s operations have been conducted in the Florida and Alabama markets. For the twelve month period ending June 30, 2013, Pipeline had gross revenues of just over $16,500,000.

The Company has accounted for this acquisition in accordance with the provisions of ASC 805, Business Combinations (ASC 805). The Company has allocated the purchase price of the business, through the use of a third party valuations and management estimates, based upon the fair value of the assets acquired and liabilities assumed as follows (in thousands):

Consideration:
Fair value of consideration transferred (cash paid)	$	(10,023	)
Acquisition related costs expensed	$	75
Recognized amounts of identifiable assets acquired and            liabilities assumed:
Property and  equipment	$	3,397
Prepaid tires and other prepaid assets		276
Customer relationships		4,004
Trade name		72
Non-compete agreement		62
Vacation liability assumed		(132	)
Total identifiable net assets assumed	$	7,679
Goodwill		2,344
Total	$	10,023

The goodwill recorded resulting from the acquisition is tax deductible. The intangible assets acquired are reflected in the line Other assets, net on the consolidated balance sheets. In connection with the Pipeline acquisition, the Company assumed certain vehicle leases. As of September 30, 2014 these non-cancellable operating leases will require minimum annual rentals approximating $2,258,000 over the next 3.1 fiscal years.

Amortization expense for the transportation segment intangible assets was $380,000 for 2014 and it is included in sales, general and administrative expense. Estimated amortization expense for the five succeeding years follows (in thousands):

	Amount
2015	$	414
2016		414
2017		406
2018		394
2019		382
Total	$	2,010

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Business Segments - Business Segments (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012	Nov. 07, 2013	Sep. 30, 2011
Revenues	$ 160,140	$ 139,774	$ 127,514
Operating profit	17,768	20,434	14,101
Corporate expenses	(5,223)	(4,851)	(4,408)
Interest expense	1,475	2,520	2,638
Capital expenditures	32,311	38,548	34,348
Depreciation, depletion and amortization	16,139	14,065	12,994
Identifiable net assets	313,071	287,093	275,705
Discontinued transportation assets			0
Cash items	1,013	502	6,713		21,026
(a) Capital expenditures related to the Pipeline Transportation, Inc. acquisition				3,397
(b) Receivable on previously capitalized real estate taxes on Anacostia property			2,311
Transportation
Revenues	129,162	112,120	103,476
Operating profit	8,027	11,119	9,107
Corporate expenses	(1,721)	(1,765)	(1,631)
Capital expenditures	13,028	15,612	10,459
Depreciation, depletion and amortization	8,813	7,401	6,750
Identifiable net assets	59,465	49,410	42,642
(a) Capital expenditures related to the Pipeline Transportation, Inc. acquisition	3,397
Mining royalty land
Revenues	5,349	5,302	4,483
Operating profit	4,736	4,739	3,905
Corporate expenses	(755)	(731)	(674)
Interest expense	44	59	40
Capital expenditures	0	0	11,039
Depreciation, depletion and amortization	124	105	112
Identifiable net assets	39,368	40,008	39,695
Developed property rentals
Revenues	25,629	22,352	19,555
Operating profit	10,228	9,427	5,497
Corporate expenses	(1,133)	(1,094)	(1,012)
Interest expense	1,431	2,461	2,598
Capital expenditures	16,939	19,751	11,804
Capital expenditures - capitalized interest	1,763	1,863	1,646
Capital expenditures - internal labor	469	418	609
Capital expenditures - real estate taxes (a)	112	904	(1,209)
Depreciation, depletion and amortization	6,721	6,141	5,729
Identifiable net assets	211,556	195,476	184,358
(b) Receivable on previously capitalized real estate taxes on Anacostia property			2,311
Corporate
Corporate expenses	(1,614)	(1,261)	(1,091)
Depreciation, depletion and amortization	481	418	403
Identifiable net assets	$ 1,669	$ 1,697	$ 2,297

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Consolidated Real Estate and Accumulated Depreciation and Depletion (Tables) - Real Estate and Accumulated Depreciation and Depletion (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Real Estate [Abstract]
Gross Carrying Cost of Real Estate at beginning of period	$ 268,932	$ 262,564	$ 241,253
Additions capitalized during period	19,154	22,228	21,380
Cost of real estate sold	(1,415)	(10,021)	(69)
Other deductions	0	(5,839)	0
Gross Carrying Cost of Real Estate at end of period	286,671	268,932	262,564
Accumulated Depreciation & Depletion at beginning of period	62,167	58,997	54,110
Charged to cost & expense	5,446	4,938	4,956
Real estate sold	(15)	(461)	(69)
Other deductions	0	(1,307)	0
Accumulated Depreciation & Depletion at end of period	$ 67,598	$ 62,167	$ 58,997

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Subsequent Events

12 Months Ended

Sep. 30, 2014

Subsequent Events [Abstract]

Subsequent Events

21. Subsequent Events.

In May 2014, we announced a plan to separate our transportation and real estate businesses through a tax-free spin-off of the transportation group. In order to facilitate the spin-off, we completed an internal corporate reorganization in December 2014 in which your shares of Patriot common stock were converted into an equal number of shares of common stock of our newly publicly traded holding company, FRP Holdings, Inc. For more information on the spin-off, see Item 1 “Business” of our Annual Report on Form 10-K.

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Accounting Policies (Policies)

12 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

ORGANIZATION - FRP Holdings, Inc. (Company) is engaged in the transportation and real estate businesses. The Company’s transportation business is conducted through its subsidiary, Florida Rock & Tank Lines, Inc. (Tank Lines). Tank Lines is a Southeastern transportation company concentrating in the hauling by motor carrier of primarily petroleum related bulk liquids and dry bulk commodities. The Company’s real estate group, through subsidiaries, acquires, constructs, leases, operates and manages land and buildings to generate both current cash flows and long-term capital appreciation. The real estate group also owns real estate that is leased under mining royalty agreements or held for investment.

Consolidation

CONSOLIDATION - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Investments in the Brooksville joint venture and Riverfront Investment Partner I, LLC are accounted for under the equity method of accounting (See Note 2). All significant intercompany transactions have been eliminated in consolidation.

Cash and Cash Equiivalents

CASH AND CASH EQUIVALENTS - The Company considers all highly liquid debt instruments with maturities of three months or less at time of purchase to be cash equivalents. Bank overdrafts consist of outstanding checks not yet presented to a bank for settlement, net of cash held in accounts with right of offset. Bank overdrafts of $933,000 and $248,000 are included in Accounts payable as of September 30, 2014 and 2013 respectively.

Inventory

INVENTORY - Inventory of parts and supplies is valued at the lower of cost (first-in, first-out) or market.

Tires on Equipment

TIRES ON EQUIPMENT - The value of tires on tractors and trailers is accounted for as a prepaid expense and amortized over the life of the tires as a function of miles driven.

Revenue and Expense Recognition

REVENUE AND EXPENSE RECOGNITION - Transportation revenue, including fuel surcharges, is recognized when the services have been rendered to customers or delivery has occurred, the pricing is fixed or determinable and collectibility is reasonably assured. Transportation expenses are recognized as incurred.

Real estate rental revenue and mining royalties are generally recognized when earned under the leases. Rental income from leases with scheduled increases or other incentives during their term is recognized on a straight-line basis over the term of the lease. Reimbursements of expenses, when provided in the lease, are recognized in the period that the expenses are incurred.

Sales of real estate are recognized when the collection of the sales price is reasonably assured and when the Company has fulfilled substantially all of its obligations, which are typically as of the closing date.

Accounts receivable are recorded net of discounts and provisions for estimated allowances. We estimate allowances on an ongoing basis by considering historical and current trends. We record estimated bad debts expense as a selling, general and administrative expense. We estimate the net collectibility of our accounts receivable and establish an allowance for doubtful accounts based upon this assessment. Specifically, we analyze the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms.

Property and Equipment

PROPERTY AND EQUIPMENT - Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

	Years
Buildings and improvements	7-39
Revenue equipment	7-10
Other equipment	3-10

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves. Reserve estimates are periodically adjusted based upon surveys.

The Company recorded depreciation and depletion expenses for 2014, 2013 and 2012 of $14,426,000, $12,856,000, and $12,250,000, respectively.

All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property. Included in indirect costs is an allocation of internal costs associated with development of real estate investments. The cost of routine repairs and maintenance to property and equipment is expensed as incurred.

Impairment of Long-Lived assets

IMPAIRMENT OF LONG-LIVED ASSETS – The Company periodically reviews its long-lived assets, which include property and equipment and purchased intangible assets subject to amortization for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. The review of real estate group assets consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures. The review of the transportation segment assets consists of a review of future anticipated results considering business prospects and asset utilization. If the sum of these future cash flows (undiscounted and without interest charges) is less than the carrying amount of the assets, the Company would record an impairment loss based on the fair value of the assets with the fair value of the assets generally based upon an estimate of the discounted future cash flows expected with regards to the assets and their eventual disposition.

Goodwill

GOODWILL – Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in the acquisition of a business. Goodwill is not amortized, but rather is tested for impairment annually and when events or changes in circumstances indicate that the fair value of a reporting unit with goodwill has been reduced below carrying value. The impairment test requires allocating goodwill and other assets and liabilities to reporting units. The fair value of each reporting unit is determined and compared to the book value of the reporting unit. If the fair value of the reporting unit is less than the book value, including goodwill, then the recorded goodwill is impaired to its implied fair value with a charge to operating expense.

Developed Property Rentals Purchase Accounting

DEVELOPED PROPERTY RENTALS PURCHASE ACCOUNTING – Acquisitions of rental property, including any associated intangible assets, are measured at fair value at the date of acquisition. Any liabilities assumed or incurred are recorded at their fair value at the time of acquisition. The fair value of the acquired property is allocated between land and building (on an as-if vacant basis) based on management’s estimate of the fair value of those components for each type of property and to tenant improvements based on the depreciated replacement cost of the tenant improvements, which approximates their fair value. The fair value of the in-place leases is recorded as follows:

· the fair value of leases in-place on the date of acquisition is based on absorption costs for the estimated lease-up period in which vacancy and foregone revenue are avoided due to the presence of the acquired leases;

· the fair value of above and below-market in-place leases based on the present value (using a discount rate that reflects the risks associated with the acquired leases) of the difference between contractual rent amounts to be paid under the assumed lease and the estimated market lease rates for the corresponding spaces over the remaining non-cancelable terms of the related leases; and

· the fair value of intangible tenant or customer relationships.

The Company’s determination of these fair values requires it to estimate market rents for each of the leases and make certain other assumptions. These estimates and assumptions affect the rental revenue, and depreciation and amortization expense recognized for these leases and associated intangible assets and liabilities.

Investments

INVESTMENTS - The Company uses the equity method to account for its investment in Brooksville, in which it has a voting interest of 50% and has significant influence but does not have control. The Company uses the equity method to account for its investment in Riverfront Investment Partners I, LLC, in which the equity interest will be determined based on leverage of the entity, additional cash contributions by the Company, and negotiations with potential third partners. Under the equity method, the investment is originally recorded at cost and adjusted to recognize the Company’s share of net earnings or losses of the investee, limited to the extent of the Company’s investment in and advances to the investee and financial guarantees on behalf of the investee that create additional basis. The Company regularly monitors and evaluates the realizable value of its investments. When assessing an investment for an other-than-temporary decline in value, the Company considers such factors as, the performance of the investee in relation to its own operating targets and its business plan, the investee’s revenue and cost trends, as well as liquidity and cash position, and the outlook for the overall industry in which the investee operates. From time to time, the Company may consider third party evaluations or valuation reports. If events and circumstances indicate that a decline in the value of these assets has occurred and is other-than-temporary, the Company records a charge to investment income (expense).

Insurance

INSURANCE – The Company has a $250,000 to $500,000 self-insured retention per occurrence in connection with certain of its workers’ compensation, automobile liability, and general liability insurance programs ("risk insurance"). The Company is also self-insured for its employee health insurance benefits and carries stop loss coverage for losses over $250,000 per covered participant per year plus a $72,000 aggregate. The Company has established an accrued liability for the estimated cost in connection with its portion of its risk and health insurance losses incurred and reported. Claims paid by the Company are charged against the liability. Additionally, the Company maintains an accrued liability for incurred but not reported claims based on historical analysis of such claims. The method of calculating the accrual liability is subject to inherent uncertainty. If actual results are less favorable than the estimates used to calculate the liabilities, the Company would have to record expenses in excess of what has been accrued. Accrued insurance liabilities decreased due to payments to our new insurer under a captive agreement along with payment in settlement of three unusually large prior year liability and health claims. Payments under the captive agreement are for the fiscal 2013 year-to-date loss fund as estimated in advance using actuarial methodology. The captive agreement provides that we will share in the underwriting results, good or bad, within a $250,000 per occurrence layer of loss through retrospective premium adjustments.

Income Taxes

INCOME TAXES - Deferred tax assets and liabilities are recognized based on differences between financial statement and tax bases of assets and liabilities using presently enacted tax rates. Deferred income taxes result from temporary differences between pre-tax income reported in the financial statements and taxable income. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination of the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of limitations, effectively settled issues under audit, and audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. It is the Company's policy to recognize as additional income tax expense the items of interest and penalties directly related to income taxes.

Stock Based Compensation

STOCK BASED COMPENSATION – The Company accounts for compensation related to share based plans by recognizing the grant date fair value of stock options and other equity-based compensation issued to employees in its income statement over the requisite employee service period using the straight-line attribution model. In addition, compensation expense must be recognized for the change in fair value of any awards modified, repurchased or cancelled after the grant date. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used in the model and current year impact is discussed in Footnote 7.

Pension Plan

PENSION PLAN - The Company accounts for its pension plan following the requirements of FASB ASC Topic 715, “Compensation – Retirement Benefits”, which requires an employer to: (a) recognize in its statement of financial position the funded status of a benefit plan; (b) measure defined benefit plan assets and obligations as of the end of the employer's fiscal year (with limited exceptions); and (c) recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise but are not recognized as components of net periodic benefit costs pursuant to prior existing guidance.

Earnings Per Common Share

EARNINGS PER COMMON SHARE - Basic earnings per common share are based on the weighted average number of common shares outstanding during the periods. Diluted earnings per common share are based on the weighted average number of common shares and potential dilution of securities that could share in earnings. The differences between basic and diluted shares used for the calculation are the effect of employee and director stock options and restricted stock.

Use of Estimates

USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United State requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain accounting policies and estimates are of more significance in the financial statement preparation process than others. The most critical accounting policies and estimates include the economic useful lives and salvage values of our vehicles and equipment, provisions for uncollectible accounts receivable and collectibility of unrealized rents and notes receivable, estimates of exposures related to our insurance claims plans, and estimates for taxes. To the extent that actual, final outcomes are different than these estimates, or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting period will be affected.

Environmental

ENVIRONMENTAL - Environmental expenditures that benefit future periods are capitalized. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded for the estimated amount of expected environmental assessments and/or remedial efforts. Estimation of such liabilities includes an assessment of engineering estimates, continually evolving governmental laws and standards, and potential involvement of other potentially responsible parties.

Comprehensive Income

COMPREHENSIVE INCOME – Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) refers to expenses, gains, and losses that are not included in net income, but rather are recorded directly in shareholder’s equity.

Recently Issued Accounting Standards

RECENTLY ISSUED ACCOUNTING STANDARDS – In April 2014, the FASB issued ASU 2014-08, "Presentation of Financial Statements and Property, Plant, and Equipment - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." ASU 2014-08 changes the definition of a discontinued operation to include only those disposals of components of an entity that represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. The ASU also expands the disclosure requirements for transactions that meet the definition of a discontinued operation and requires entities to disclose information about individually significant components that are disposed of or held for sale and do not qualify as discontinued operations. This new guidance is effective for annual periods beginning on or after December 15, 2014 and interim periods within those years, with early adoption permitted. Effective second quarter 2014, the Company adopted ASU 2014-08 and will apply the new guidance, as applicable, to future disposals of components or classifications as held for sale.

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Shareholders Equity (USD $) In Thousands, except Share data	Common Stock	Capital in Excess of Par Value	Retained Earnings	Accumulated Other Comprehensive Loss, net of tax	Total
Beginning balance, amount at Sep. 30, 2011	$ 929	$ 38,845	$ 124,642	$ 31	$ 164,447
Beginning balance, shares at Sep. 30, 2011	9,288,023
Exercise of stock options, shares	153,505				153,505
Exercise of stock options, amount	15	1,307			1,322
Excess tax benefits from exercises of stock options and vesting of restricted stock		811			811
Stock option compensation		324			324
Shares granted to Directors, shares	15,000
Shares granted to Directors, amount	1	319			320
Shares purchased and canceled, shares	(15,908)
Shares purchased and canceled, amount	(1)	(67)	(247)		(315)
Net income			7,808		7,808
Minimum pension liability, net of tax				7	7
Net actuarial loss retiree health, net of tax				(6)	(6)
Ending balance, amount at Sep. 30, 2012	944	41,539	132,203	32	174,718
Ending balance, shares at Sep. 30, 2012	9,440,620
Exercise of stock options, shares	112,800				112,800
Exercise of stock options, amount	11	1,175			1,186
Excess tax benefits from exercises of stock options and vesting of restricted stock		701			701
Stock option compensation		376			376
Shares granted to Directors, shares	19,500
Shares granted to Directors, amount	2	505			507
Shares purchased and canceled, shares	(8,700)
Shares purchased and canceled, amount	(1)	(38)	(194)		(233)
Net income			15,385		15,385
Minimum pension liability, net of tax				6	6
Net actuarial loss retiree health, net of tax					0
Ending balance, amount at Sep. 30, 2013	956	44,258	147,394	38	192,646
Ending balance, shares at Sep. 30, 2013	9,564,220
Exercise of stock options, shares	119,550				119,550
Exercise of stock options, amount	12	1,450			1,462
Excess tax benefits from exercises of stock options and vesting of restricted stock		1,047			1,047
Stock option compensation		441			441
Shares granted to Directors, shares	19,500
Shares granted to Directors, amount	2	696			698
Net income			10,019		10,019
Minimum pension liability, net of tax				4	4
Net actuarial loss retiree health, net of tax				(2)	(2)
Ending balance, amount at Sep. 30, 2014	$ 970	$ 47,892	$ 157,413	$ 40	$ 206,315
Ending balance, shares at Sep. 30, 2014	9,703,270

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Consolidated Real Estate and Accumulated Depreciation and Depletion (Tables)

12 Months Ended

Sep. 30, 2014

Real Estate [Abstract]

Schedule III Real Estate and Accumulated Depreciation and Depletion

PATRIOT TRANSPORTATION HOLDING, INC.
SCHEDULE III (CONSOLIDATED) - REAL ESTATE & ACCUMULATED DEPRECIATION AND DEPLETION
(dollars in thousands)
SEPTEMBER 30, 2013
					Cost			Gross amount				Year				Depreciation
	Encumb-		Initial Cost		capitalized			at which		Accumulated		of		Date		Life
County	rances		to		subsequent			carried at		Depreciation		Construct-		Acquired		Computed
			Company		to			end of		& Depletion		ion				on:
					acquisition			period(a)
Construction Aggregates
Alachua, FL	$	—	$	1,442	$	—		$	1,442	$	137		n/a		4/86		unit
Clayton, GA		—		369		—			369		5		n/a		4/86		unit
Fayette, GA		—		685		—			685		64		n/a		4/86		unit
Lake, FL		—		402		—			402		146		n/a		4/86		unit
Lake Louisa, FL		—		11,039		—			11,039		—		n/a		5/12		unit
Lee, FL		—		4,690		6			4,696		6		n/a		4/86		unit
Monroe, GA		—		792		—			792		281		n/a		4/86		unit
Muscogee, GA		—		369		(45	)		324		295		n/a		4/86		unit
Prince Wil., VA		—		299		—			299		299		n/a		4/86		unit
Putnam, FL		—		15,002		37			15,039		4,289		n/a		4/86		unit
		—		35,089		(2	)		35,087		5,522
Other Rental Property
Wash D.C.		—		2,957		10,200			13,157		2,387		n/a		4/86		15 yr
Wash D.C.		—		3,811		—			3,811		—		n/a		10/97		n/a
Putnam, FL		—		302		(2	)		300		283		n/a		4/86		5 yr
Spalding, GA		—		20		—			20		—		n/a		4/86		n/a
Lake, FL		—		1,083		—			1,083		968		n/a		4/86		unit
Marion, FL		—		1,180		4			1,184		599		n/a		4/86		unit
		—		9,353		10,202			19,555		4,237
Commercial Property
Baltimore, MD		2,010		439		4,662			5,101		2,518		1990		10/89		39 yr
Baltimore, MD		4,357		950		6,902			7,852		4,199		1994		12/91		39 yr
Baltimore, MD		1,486		690		2,861			3,551		1,337		2000		7/99		39 yr
Baltimore, MD		—		5,634		10,597			16,231		664		2008		12/02		39 yr
Baltimore City, MD		—		5,750		4,755			10,505		482		2010		12/10		39 yr
Baltimore City, MD		—		7,442		225			7,667		73		n/a		6/13		39 yr
Duval, FL		—		2,416		541			2,957		2,731		n/a		4/86		25 yr
Harford, MD		1,194		31		3,830			3,861		1,923		1998		8/95		39 yr
Harford, MD		2,405		50		5,699			5,749		2,241		1999		8/95		39 yr
Harford, MD		3,787		85		7,091			7,176		3,155		2001		8/95		39 yr
Harford, MD		—		92		1,487			1,579		—		n/a		8/95		39 yr
Harford, MD		2,873		88		10,133			10,221		3,534		2007		8/95		39 yr
Harford, MD		2,155		155		12,331			12,486		3,222		2009		8/95		39 yr
Howard, MD		1,644		2,859		4,750			7,609		3,841		1996		9/88		39 yr
Howard, MD		1,344		2,473		981			3,454		1,251		2000		3/00		39 yr
Anne Arun, MD		—		715		8,865			9,580		5,123		1989		9/88		39 yr
Anne Arun, MD		7,379		950		13,120			14,070		4,105		2003		5/98		39 yr
Anne Arun, MD		—		1,525		10,800			12,325		2,763		2005		8/04		39 yr
Anne Arun, MD		4,012		737		5,324			6,061		1,330		2006		1/03		39 yr
Anne Arun, MD		—		667		10,259			10,926		1,584		2012		7/07		39 yr
Norfolk, VA		5,577		7,512		—			7,512		2,001		2004		10/04		39 yr
Prince Wil., VA		—		7,324		18,113			25,437		202		n/a		12/05		39 yr
Newcastle Co., DE		9,681		11,559		2,268			13,827		3,457		2004		4/04		39 yr
Carroll, MD		—		4,720		2,305			7,025		—		n/a		3/08		n/a
		49,904		64,863		147,899			212,762		51,736
Investment Property		—		2,231		(703	)		1,528		672		n/a		4/86		n/a
GRAND TOTALS	$	49,904	$	111,536	$	157,396		$	268,932	$	62,167
(a) The aggregate cost for Federal income tax purposes is $239,194.

Real Estate and Accumulated Depreciation and Depletion

PATRIOT TRANSPORTATION HOLDING, INC.
SCHEDULE III (CONSOLIDATED) - REAL ESTATE AND
ACCUMULATED DEPRECIATION AND DEPLETION
YEARS ENDED SEPTEMBER 30, 2013, 2012 AND 2011
(In thousands)
	2013		2012		2011
Gross Carrying Cost of Real Estate:
Balance at beginning of period	262,564		241,253		225,630
Additions during period:
Amounts capitalized	22,228		21,380		15,899
Deductions during period:
Cost of real estate sold	(10,021	)	(69	)	(276	)
Other	(5,839	)	—		—
Balance at close of period	268,932		262,564		241,253
Accumulated Depreciation & Depletion:
Balance at beginning of period	58,997		54,110		49,499
Additions during period:
Charged to cost & expense	4,938		4,956		4,611
Deductions during period:
Real estate sold	(461	)	(69	)	—
Other	(1,307	)	—		—
Balance at close of period	62,167		58,997		54,110

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Discontinued Operations (Tables)

12 Months Ended

Sep. 30, 2014

Discontinued Operations and Disposal Groups [Abstract]

Summary of Discontinued Operations

(in thousands)		2014	2013	2012
Revenue	$	—	—	50
Operating expenses		—	—	(107	)
Gain on sale before taxes		—	—	—
Income before income taxes	$	—	—	157
Permanent tax benefit		—	—	—
Provision for taxes		—	—	(60	)
Income from discontinued operations	$	—	—	97

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Income Taxes - Provision for income taxes (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Income Tax Disclosure [Abstract]
Federal, current	$ 5,747	$ 4,264	$ 2,834
State, current	1,708	1,136	437
Current income tax expense	7,455	5,400	3,271
Deferred	(803)	4,437	1,538
Provision for income taxes	6,652	9,837	4,809
Federal, computed at statutory rate	5,737	8,636	4,256
State income taxes (net of Federal income tax benefit)	886	1,129	562
Other, net	$ 29	$ 72	$ (9)

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Stock-Based Compensation Plans (Details Narrative) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Sep. 30, 2014 Years
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Number of stock option plans	2
Expire date in years	10
Exercisable installments	20% or 25%
Shares available for future issuance	486,590
Dividend yield	0.00%
Expected minimum volatility	37.00%
Expected maximum volatility	46.00%
Risk-free interest rate minimum	0.30%
Risk-free interest rate maximum	4.20%
Expected life minimum	3.0
Expecited life maximum	7.0
Aggregate intrinsic value of exercisable in-the-money options	$ 2,526
Aggregate intrinsic value of outstanding in-the-money options	3,014
Market close price	$ 33.92
Gains realized by option holders	2,918
Realized tax benefit from options exercised	1,129
Total compensation cost of options granted but not yet vested	$ 814
Weighted average period for compensation to be recognized	3.3

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Sep. 30, 2013
Current assets:
Cash and cash equivalents	$ 1,013	$ 502
Cash held in escrow	61	1,569
Accounts receivable, net of allowance for doubtful accounts of $155 and $162, respectively	8,246	7,707
Real estate tax refund receivable	0	1,576
Inventory of parts and supplies	895	881
Prepaid tires on equipment	2,048	1,871
Prepaid taxes and licenses	2,436	2,223
Prepaid insurance	789	609
Prepaid expenses, other	83	79
Real estate held for sale, at cost	4,473	0
Total current assets	20,044	17,017
Property, plant and equipment, at cost:
Land	104,806	111,055
Buildings	166,324	151,812
Equipment	92,403	86,410
Construction in progress	8,971	7,058
Property, plant and equipment, at cost	372,504	356,335
Less accumulated depreciation and depletion	122,894	114,922
Net property, plant and equipment	249,610	241,413
Real estate held for investment, at cost	7,304	4,343
Investment in joint ventures	18,537	13,406
Goodwill	3,431	1,087
Unrealized rents	4,780	4,659
Other assets	9,365	5,168
Total assets	313,071	287,093
Current liabilities:
Accounts payable	7,318	7,290
Deferred income taxes	239	127
Federal and state income taxes payable	701	475
Accrued payroll and benefits	4,568	6,008
Accrued insurance	1,186	1,285
Environmental remediation	1,771	0
Accrued liabilities, other	1,610	1,486
Long-term debt due within one year	4,534	4,311
Total current liabilities	21,927	20,982
Long-term debt, less current portion	58,704	45,593
Deferred income taxes	21,654	22,567
Accrued insurance	1,393	1,133
Other liabilities	3,078	4,172
Commitments and contingencies (Notes 12 and 13)
Shareholders' equity:
Preferred stock, no par value; 5,000,000 shares authorized	0	0
Common stock, $.10 par value; 25,000,000 shares authorized, 9,703,270 and 9,564,220 shares issued	970	956
Capital in excess of par value	47,892	44,258
Retained earnings	157,413	147,394
Accumulated other comprehensive income, net	40	38
Total shareholders' equity	206,315	192,646
Total liabilities and shareholders' equity	$ 313,071	$ 287,093

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Investment in Riverfront and Brooksville Joint Ventures (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Total Investment	$ 18,537	$ 13,406
Total Assets of the Partnership	48,187	22,101
Net Loss of the Partnership	(167)	(104)
Company's share of Net Loss of the Partnership	(128)	(63)	(8)
Cash	208	18
Cash held in escrow	18,822	0
Amortizable Debt costs	2,069	0
Investments in real estate, net	27,088	22,083
Total assets	48,187	22,101
Other liabilities	313	214
Long-term debt	17,000	0
Capital - FRP Holdings	18,537	13,406
Capital - Third parties	12,337	8,481
Total liabilities and capital	48,187	22,101
Riverfront I Joint Venture
Ownership percent	76.91%	88.82%
Total Investment	11,031	5,894
Total Assets of the Partnership	33,834	7,745
Net Loss of the Partnership	(89)	(22)
Company's share of Net Loss of the Partnership	(89)	(22)
Total assets	33,834	7,745
Capital - FRP Holdings	11,031	5,894
Brooksville Joint Venture
Ownership percent	50.00%	50.00%
Total Investment	7,506	7,512
Total Assets of the Partnership	14,353	14,356
Net Loss of the Partnership	(78)	(82)
Company's share of Net Loss of the Partnership	(39)	(41)
Total assets	14,353	14,356
Capital - FRP Holdings	$ 7,506	$ 7,512

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Consolidated Statements of Cash Flows (Parenthetical) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013
Statement of Cash Flows [Abstract]
Noncash transaction deferred gains and post sale obligations	$ 334

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Real Estate Kelso Business Park Acquisition (Details) (Kelso Business Park, USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Jun. 06, 2014
Kelso Business Park
In-place leases initial value								$ 579
Below market leases initial values								64
In-place Leases	9	18	25	96	133	218	80
Below Market Leases			$ 2	$ 12	$ 21	$ 21	$ 8

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Leases (Tables)

12 Months Ended

Sep. 30, 2014

Leases [Abstract]

Property leased or held for lease

Construction aggregates property	$	35,087
Commercial property		250,056
		285,143
less accumulated depreciation and depletion		66,920
	$	218,223

Future minimum annual operating lease payments

Fiscal Year	Total
2015	$	393
2016	278
2017	278
2018	278
2019	278
Thereafter	995
Total minimum lease payments	$	2,500

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Schedule III Real Estate and Accumulated Depreciation and Depletion Part I (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2011
Encumbrances	$ 45,593
Initial Cost to Company	115,243
Cost capitalized subsequent to acquisition	171,428
Gross amount at which carried at end of period	286,671	268,932	262,564	241,253
Accumulated Depreciation & Depletion	67,598
Aggregate cost for Federal income tax purposes	252,925
Construction Aggregates
Encumbrances	0
Initial Cost to Company	35,089
Cost capitalized subsequent to acquisition	(2)
Gross amount at which carried at end of period	35,087
Accumulated Depreciation & Depletion	5,633
Baltimore, MD 5
Encumbrances	0
Initial Cost to Company	4,309
Cost capitalized subsequent to acquisition	218
Gross amount at which carried at end of period	4,527
Accumulated Depreciation & Depletion	38
Commercial Property
Encumbrances	45,593
Initial Cost to Company	69,172
Cost capitalized subsequent to acquisition	161,222
Gross amount at which carried at end of period	230,394
Accumulated Depreciation & Depletion	56,890
Investment Property
Encumbrances	0
Initial Cost to Company	1,629
Cost capitalized subsequent to acquisition	(101)
Gross amount at which carried at end of period	1,528
Accumulated Depreciation & Depletion	678
Alachua, FL
Encumbrances	0
Initial Cost to Company	1,442
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	1,442
Accumulated Depreciation & Depletion	142
Clayton, GA
Encumbrances	0
Initial Cost to Company	369
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	369
Accumulated Depreciation & Depletion	5
Fayette, GA
Encumbrances	0
Initial Cost to Company	685
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	685
Accumulated Depreciation & Depletion	64
Lake, FL
Encumbrances	0
Initial Cost to Company	402
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	402
Accumulated Depreciation & Depletion	146
Lake Louise, FL
Encumbrances	0
Initial Cost to Company	11,039
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	11,039
Accumulated Depreciation & Depletion	0
Lee, FL
Encumbrances	0
Initial Cost to Company	4,690
Cost capitalized subsequent to acquisition	6
Gross amount at which carried at end of period	4,696
Accumulated Depreciation & Depletion	6
Monroe, GA
Encumbrances	0
Initial Cost to Company	792
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	792
Accumulated Depreciation & Depletion	283
Muscogee, GA
Encumbrances	0
Initial Cost to Company	369
Cost capitalized subsequent to acquisition	(45)
Gross amount at which carried at end of period	324
Accumulated Depreciation & Depletion	313
Prince Wil, VA
Encumbrances	0
Initial Cost to Company	299
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	299
Accumulated Depreciation & Depletion	299
Putnam, FL
Encumbrances	0
Initial Cost to Company	15,002
Cost capitalized subsequent to acquisition	37
Gross amount at which carried at end of period	15,039
Accumulated Depreciation & Depletion	4,375
Wash DC 1
Encumbrances	0
Initial Cost to Company	2,957
Cost capitalized subsequent to acquisition	10,307
Gross amount at which carried at end of period	13,264
Accumulated Depreciation & Depletion	2,547
Wash DC 2
Encumbrances	0
Initial Cost to Company	3,811
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	3,811
Accumulated Depreciation & Depletion	0
Putnam, FL 2
Encumbrances	0
Initial Cost to Company	302
Cost capitalized subsequent to acquisition	(2)
Gross amount at which carried at end of period	300
Accumulated Depreciation & Depletion	283
Spalding, GA
Encumbrances	0
Initial Cost to Company	20
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	20
Accumulated Depreciation & Depletion	0
Lake, FL 2
Encumbrances	0
Initial Cost to Company	1,083
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	1,083
Accumulated Depreciation & Depletion	968
Marion, FL
Encumbrances	0
Initial Cost to Company	1,180
Cost capitalized subsequent to acquisition	4
Gross amount at which carried at end of period	1,184
Accumulated Depreciation & Depletion	599
Property leased or held for lease
Encumbrances	0
Initial Cost to Company	9,353
Cost capitalized subsequent to acquisition	10,309
Gross amount at which carried at end of period	19,662
Accumulated Depreciation & Depletion	4,397
Baltimore, MD 1
Encumbrances	1,912
Initial Cost to Company	439
Cost capitalized subsequent to acquisition	4,662
Gross amount at which carried at end of period	5,101
Accumulated Depreciation & Depletion	2,650
Baltimore, MD 2
Encumbrances	3,909
Initial Cost to Company	950
Cost capitalized subsequent to acquisition	7,324
Gross amount at which carried at end of period	8,274
Accumulated Depreciation & Depletion	4,389
Baltimore, MD 3
Encumbrances	1,329
Initial Cost to Company	690
Cost capitalized subsequent to acquisition	2,861
Gross amount at which carried at end of period	3,551
Accumulated Depreciation & Depletion	1,436
Baltimore, MD 4
Encumbrances	0
Initial Cost to Company	5,634
Cost capitalized subsequent to acquisition	11,504
Gross amount at which carried at end of period	17,138
Accumulated Depreciation & Depletion	810
Baltimore City, MD
Encumbrances	0
Initial Cost to Company	5,750
Cost capitalized subsequent to acquisition	5,609
Gross amount at which carried at end of period	11,359
Accumulated Depreciation & Depletion	678
Baltimore City, MD 2
Encumbrances	0
Initial Cost to Company	7,442
Cost capitalized subsequent to acquisition	834
Gross amount at which carried at end of period	8,276
Accumulated Depreciation & Depletion	396
Duval, FL
Encumbrances	0
Initial Cost to Company	2,416
Cost capitalized subsequent to acquisition	541
Gross amount at which carried at end of period	2,957
Accumulated Depreciation & Depletion	2,752
Harford, MD 1
Encumbrances	974
Initial Cost to Company	31
Cost capitalized subsequent to acquisition	3,830
Gross amount at which carried at end of period	3,861
Accumulated Depreciation & Depletion	2,009
Harford, MD 2
Encumbrances	2,088
Initial Cost to Company	50
Cost capitalized subsequent to acquisition	5,699
Gross amount at which carried at end of period	5,749
Accumulated Depreciation & Depletion	2,377
Harford, MD 3
Encumbrances	3,433
Initial Cost to Company	85
Cost capitalized subsequent to acquisition	7,091
Gross amount at which carried at end of period	7,176
Accumulated Depreciation & Depletion	3,345
Harford, MD 4
Encumbrances	0
Initial Cost to Company	92
Cost capitalized subsequent to acquisition	1,509
Gross amount at which carried at end of period	1,601
Accumulated Depreciation & Depletion	0
Harford, MD 5
Encumbrances	2,645
Initial Cost to Company	88
Cost capitalized subsequent to acquisition	10,133
Gross amount at which carried at end of period	10,221
Accumulated Depreciation & Depletion	3,819
Harford, MD 6
Encumbrances	1,954
Initial Cost to Company	155
Cost capitalized subsequent to acquisition	12,337
Gross amount at which carried at end of period	12,492
Accumulated Depreciation & Depletion	3,605
Howard, MD 1
Encumbrances	1,272
Initial Cost to Company	2,859
Cost capitalized subsequent to acquisition	4,778
Gross amount at which carried at end of period	7,637
Accumulated Depreciation & Depletion	4,010
Howard, MD 2
Encumbrances	1,201
Initial Cost to Company	2,473
Cost capitalized subsequent to acquisition	981
Gross amount at which carried at end of period	3,454
Accumulated Depreciation & Depletion	1,327
Anne Arun, MD 1
Encumbrances	0
Initial Cost to Company	715
Cost capitalized subsequent to acquisition	9,211
Gross amount at which carried at end of period	9,926
Accumulated Depreciation & Depletion	5,365
Anne Arun, MD 2
Encumbrances	6,546
Initial Cost to Company	950
Cost capitalized subsequent to acquisition	13,120
Gross amount at which carried at end of period	14,070
Accumulated Depreciation & Depletion	4,484
Anne Arun, MD 3
Encumbrances	0
Initial Cost to Company	1,525
Cost capitalized subsequent to acquisition	10,800
Gross amount at which carried at end of period	12,325
Accumulated Depreciation & Depletion	3,088
Anne Arun, MD 4
Encumbrances	3,816
Initial Cost to Company	737
Cost capitalized subsequent to acquisition	5,341
Gross amount at which carried at end of period	6,078
Accumulated Depreciation & Depletion	1,521
Anne Arun, MD 5
Encumbrances	0
Initial Cost to Company	667
Cost capitalized subsequent to acquisition	10,259
Gross amount at which carried at end of period	10,926
Accumulated Depreciation & Depletion	2,001
Norfolk, VA
Encumbrances	5,305
Initial Cost to Company	7,512
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	7,512
Accumulated Depreciation & Depletion	2,224
Prince Wil, VA 2
Encumbrances	0
Initial Cost to Company	7,324
Cost capitalized subsequent to acquisition	27,508
Gross amount at which carried at end of period	34,832
Accumulated Depreciation & Depletion	690
Newcastle Co, DE
Encumbrances	9,209
Initial Cost to Company	11,559
Cost capitalized subsequent to acquisition	2,757
Gross amount at which carried at end of period	14,316
Accumulated Depreciation & Depletion	3,876
Carroll, MD
Encumbrances	0
Initial Cost to Company	4,720
Cost capitalized subsequent to acquisition	2,315
Gross amount at which carried at end of period	7,035
Accumulated Depreciation & Depletion	$ 0

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Commitments

12 Months Ended

Sep. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments

13. Commitments.

The Company, at September 30, 2014, had entered into various contracts to develop real estate with remaining commitments totaling $2,169,000, and to purchase transportation equipment for approximately $2,698,000.

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Earnings Per Share (Tables)

12 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

Earnings per share computations

Dollars in thousands, except per share amounts	Years Ended September 30
	2014		2013		2012
Common shares:
Weighted average common shares
outstanding during the period -
shares used for basic earnings
per common share		9,629		9,523		9,360
Common shares issuable under share
based payment plans which are
potentially dilutive		81		82		114
Common shares used for diluted
earnings per common share		9,710		9,605		9,474
Net income	$	10,019		15,385		7,808
Earnings per common share
Basic	$	1.04		1.62		.83
Diluted	$	1.03		1.60		.82

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Discontinued Operations

12 Months Ended

Sep. 30, 2014

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

15. Discontinued Operations.

In August 2009 the Company sold its flatbed trucking company, SunBelt Transport, Inc. ("SunBelt"). SunBelt has been accounted for as discontinued operations in accordance with ASC Topic 205-20 Presentation of Financial Statements – Discontinued Operations. All periods presented have been restated accordingly.

A summary of discontinued operations is as follows (in thousands):

		2014	2013	2012
Revenue	$	—	—	50
Operating expenses		—	—	(107	)
Gain on sale before taxes		—	—	—
Income before income taxes	$	—	—	157
Permanent tax benefit		—	—	—
Provision for taxes		—	—	(60	)
Income from discontinued operations	$	—	—	97

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Investment in Riverfront and Brooksville Joint Ventures (Details Narrative) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Capital contributions made	$ 5,266	$ 116	$ 125
Equity in the loss of the joint venture	(128)	(63)	(8)
Riverfront I Joint Venture
Square feet	300,000
Retail square feet	18,000
Land acreage	5.82
Value of land contributed	13,500
Cash contributed	4,866
Joint venture percentage stake	76.91%	88.82%
MRP minimum capital contribution	5,553
EB5 Secondary financing	17,000
Nonrecourse construction loan	65,000
Book value of land contribution	6,165
Equity in the loss of the joint venture	(89)	(22)
Brooksville Joint Venture
Land acreage	4,300
Joint venture percentage stake	50.00%	50.00%
FRP land contribution previously leased to Vulcan	3,443
Book value of land contribution	2,548
Royalty revenues	217	206
Allocated depletion expense	7
FRP additional contribution for land	3,018
Additional land acquired	288
Vulcan land contribution	553
Mandatory capital contribution obligation	2,380
Capital contributions made	2,312
Equity in the loss of the joint venture	$ (39)	$ (41)

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Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Income Statement [Abstract]
Net income	$ 10,019	$ 15,385	$ 7,808
Actuarial gain (loss) retiree health	(2)	0	(6)
Minimum pension liability	4	6	7
Comprehensive income	$ 10,021	$ 15,391	$ 7,809

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Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Sep. 30, 2014	Sep. 30, 2013
Statement of Financial Position [Abstract]
Accounts receivable allowance for doubtful accounts	$ 155	$ 162
Preferred stock, par value	$ 0	$ 0
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.10	$ 0.10
Common stock, shares authorized	25,000,000	25,000,000
Common stock, shares issued	9,703,270	9,564,220

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Income Taxes

12 Months Ended

Sep. 30, 2014

Income Tax Disclosure [Abstract]

Income Taxes

8. Income Taxes.

The provision for income taxes for continuing operations for fiscal years ended September 30 consists of the following (in thousands):

		2014		2013	2012
Current:
Federal	$	5,747		4,264	2,834
State		1,708		1,136	437
		7,455		5,400	3,271
Deferred		(803	)	4,437	1,538
Total	$	6,652		9,837	4,809

A reconciliation between the amount of tax shown above and the amount computed at the statutory Federal income tax rate follows (in thousands):

		2014	2013	2012
Amount computed at statutory
Federal rate	$	5,737	8,636	4,256
State income taxes (net of Federal
income tax benefit)		886	1,129	562
Other, net		29	72	(9	)
Provision for income taxes	$	6,652	9,837	4,809

In this reconciliation, the category “Other, net” consists of changes in unrecognized tax benefits, permanent tax differences related to non-deductible expenses, special tax rates and tax credits, interest and penalties, and adjustments to prior year estimates.

The types of temporary differences and their related tax effects that give rise to deferred tax assets and deferred tax liabilities at September 30, are presented below (in thousands):

		2014	2013
Deferred tax liabilities:
Property and equipment	$	22,496	22,650
Depletion		477	479
Unrealized rents		1,850	1,803
Prepaid expenses		1,447	1,306
Gross deferred tax liabilities		26,270	26,238
Deferred tax assets:
Insurance liabilities		819	786
Employee benefits and other		3,558	2,758
Gross deferred tax assets		4,377	3,544
Net deferred tax liability	$	21,893	22,694

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):

		2014	2013
Balance at October 1	$	—	—
Reductions due to lapse of statute of limitations		—	—
Balance at September 30	$	—	—

The Company files income tax returns in the U.S. and various states which are subject to audit for up to five years after filing.

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Document and Entity Information (USD $)	12 Months Ended
	Sep. 30, 2014	Nov. 28, 2014	Mar. 31, 2014
Document And Entity Information
Entity Registrant Name	FRP HOLDINGS, INC.
Entity Central Index Key	0000844059
Document Type	10-K
Document Period End Date	Sep. 30, 2014
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 165,387,088
Entity Common Stock, Shares Outstanding		9,713,395
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2014

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Employee Benefits

12 Months Ended

Sep. 30, 2014

Compensation and Retirement Disclosure [Abstract]

Employee Benefits

9. Employee Benefits.

The Company and certain subsidiaries have a savings/profit sharing plan for the benefit of qualified employees. The savings feature of the plan incorporates the provisions of Section 401(k) of the Internal Revenue Code under which an eligible employee may elect to save a portion (within limits) of their compensation on a tax deferred basis. The Company contributes to a participant’s account an amount equal to 50% (with certain limits) of the participant’s contribution. Additionally, the Company may make an annual discretionary contribution to the plan as determined by the Board of Directors, with certain limitations. The plan provides for deferred vesting with benefits payable upon retirement or earlier termination of employment. The Company’s cost was $758,000 in 2014, $696,000 in 2013 and $669,000 in 2012.

The Company has a Management Security Plan (MSP) for certain officers and key employees. The accruals for future benefits are based upon the remaining years to retirement of the participating employees and other actuarial assumptions. The fourth quarter of fiscal 2014 includes a $575,000 unfavorable adjustment to the actuarially assumed expense due to the death prior to retirement of one of the plan participants. Life insurance on the lives of one of the participants has been purchased to partially fund this benefit and the Company is the owner and beneficiary of that policy. The expense for fiscal 2014, 2013 and 2012 was $764,000, $176,000 and $161,000, respectively. The accrued benefit under this plan as of September 30, 2014 and 2013 was $2,078,000 and $1,351,000 respectively.

The Company provides certain health benefits for retired employees. Employees may become eligible for those benefits if they were employed by the Company prior to December 10, 1992, meet the service requirements and reach retirement age while working for the Company. The plan is contributory and unfunded. The Company accrues the estimated cost of retiree health benefits over the years that the employees render service. The accrued postretirement benefit obligation for this plan as of September 30, 2014 and 2013 was $370,000 and $357,000, respectively. The net periodic postretirement benefit cost was $12,000, $15,000 and $5,000 for fiscal 2014, 2013, and 2012, respectively. The discount rate used in determining the Net Periodic Postretirement Benefit Cost was 4.0% for 2014, 4.0% for 2013 and 4.0% for 2012. The discount rate used in determining the Accumulated Postretirement Benefit Obligation (APBO) was 4.25% for 2014, 4.0% for 2013 and 4.0% for 2012. No medical trend is applicable because the Company’s share of the cost is frozen.

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Unusual or Infrequent Items Impacting Quarterly Results (Details Narrative) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended					1 Months Ended		1 Months Ended		3 Months Ended	1 Months Ended
	Sep. 30, 2012	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013 7001 Dorsey Rd Years	Sep. 30, 2013 Oregon Center	Jul. 31, 2013 Patriot Business Park	Sep. 30, 2013 Patriot Business Park sqft	Aug. 31, 2013 Hollander 95 sqft	Aug. 31, 2013 Gulf Hammock sqft	Dec. 31, 2012 Commonwealth Avenue	Aug. 31, 2013 Windlass Run
Gain on termination of sale contract		$ 0	$ 0	$ 1,039								$ 1,039
Environmental remediation	1,771
Sales price							4,775
Gain before income taxes		476	7,333	0			341		514	433	1,116	4,928
Book value of property							3,603		595	296	723	2,971
Land acreage								15.18	5.38	284
Cash held in escrow		61	1,569
Mortgage prepayment					7,281	279
Rate of prepayed mortgage					6.12%	7.97%
Early prepayment provision in years					7.5
Prepayment penalty					382	7
Deferred loan costs on early prepayment					175
MSP adjustment		$ 575

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Consolidated Statements of Income (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Revenues:
Transportation	$ 129,162	$ 112,120	$ 103,476
Mining royalty land	5,349	5,302	4,483
Developed property rentals	25,629	22,352	19,555
Total revenues	160,140	139,774	127,514
Cost of operations:
Transportation	122,856	102,766	96,000
Mining royalty land	1,368	1,294	1,252
Developed property rentals	16,534	14,019	15,070
Unallocated corporate	1,614	1,261	1,091
Total cost of operations	142,372	119,340	113,413
Operating profit:
Transportation	6,306	9,354	7,476
Mining royalty land	3,981	4,008	3,231
Developed property rentals	9,095	8,333	4,485
Unallocated corporate	(1,614)	(1,261)	(1,091)
Total operating profit	17,768	20,434	14,101
Gain on termination of sale contract	0	0	1,039
Gain on investment land sold	476	7,333	0
Interest income and other	30	38	26
Equity in loss of joint ventures	(128)	(63)	(8)
Interest expense	(1,475)	(2,520)	(2,638)
Income before income taxes	16,671	25,222	12,520
Provision for income taxes	6,652	9,837	4,809
Income from continuing operations	10,019	15,385	7,711
Gain from discontinued operations, net	0	0	97
Net income	$ 10,019	$ 15,385	$ 7,808
Basic earnings per common share
Continuing operations	$ 1.04	$ 1.62	$ 0.82
Discontinued operations	$ 0.00	$ 0.00	$ 0.01
Net income	$ 1.04	$ 1.62	$ 0.83
Diluted earnings per common share
Continuing operations	$ 1.03	$ 1.60	$ 0.81
Discontinued operations	$ 0.00	$ 0.00	$ 0.01
Net income	$ 1.03	$ 1.60	$ 0.82
Number of weighted average shares (in thousands) used in computing:
-basic earnings per common share	9,629	9,523	9,360
-diluted earnings per common share	9,710	9,605	9,474

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Debt

12 Months Ended

Sep. 30, 2014

Debt Disclosure [Abstract]

Debt

3. Debt.

Debt at September 30 is summarized as follows (in thousands):

	2014		2013
Revolving credit (uncollateralized)	$	17,645		—
5.6% to 8.6% mortgage notes
due in installments through 2027		45,593		49,904
		63,238		49,904
Less portion due within one year		4,534		4,311
	$	58,704		45,593

The aggregate amount of principal payments, excluding the revolving credit, due subsequent to September 30, 2014 is: 2015 - $4,534,000; 2016 – $4,616,000; 2017 - $4,887,000; 2018 - $4,674,000; 2019 - $3,885,000 and subsequent years - $22,997,000.

On December 21, 2012, the Company entered into a five year credit agreement with Wells Fargo Bank, N.A. with a maximum facility amount of $55 million (the "Credit Agreement"). The Credit Agreement provides a revolving credit facility (the “Revolver”) with a maximum facility amount of $40 million, with a $20 million sublimit for standby letters of credit, and a term loan facility of $15 million. As of September 30, 2014, $17,645,000 was borrowed under the Revolver, $5,421,000 in letters of credit was outstanding, and $31,934,000 was available for additional borrowing. The letters of credit were issued for insurance retentions and to guarantee certain obligations to state agencies related to real estate development. Most of the letters of credit are irrevocable for a period of one year and typically are automatically extended for additional one-year periods. The Revolver bears interest at a rate of 1.0% over the selected LIBOR, which may change quarterly based on the Company’s ratio of Consolidated Total Debt to Consolidated Total Capital, as defined. A commitment fee of 0.15% per annum is payable quarterly on the unused portion of the commitment. The commitment fee may also change quarterly based upon the ratio described above. The Credit Agreement contains certain conditions, affirmative financial covenants and negative covenants including limitations on paying cash dividends. As of September 30, 2014, $73,558,000 of consolidated retained earnings would be available for payment of dividends. The Company was in compliance with all covenants as of September 30, 2014.

The non-recourse fully amortizing mortgage notes payable are collateralized by real estate having a carrying value of approximately $57,146,000 at September 30, 2014.

During fiscal 2014, 2013 and 2012 the Company capitalized interest costs of $1,763,000, $1,863,000, and $1,646,000, respectively.

On June 3, 2013 the Company prepaid the $7,281,000 remaining principal balance on a 6.12% mortgage under an early prepayment provision the note allowed after 7.5 years. The prepayment penalty of $382,000 is included in interest expense. The remaining deferred loan costs of $175,000 were also included in interest expense.

On July 31, 2013 the Company prepaid the $279,000 remaining principal balance on a 7.97% mortgage. The cost of the prepayment included a penalty of $7,000.

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Investment in Riverfront and Brooksville Joint Ventures

12 Months Ended

Sep. 30, 2014

Equity Method Investments and Joint Ventures [Abstract]

Investment in Riverfront and Brooksville Joint Ventures

2. Investment In Riverfront and Brooksville Joint Ventures.

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 a portion 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 scheduled in 2016 and 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.

A subsidiary of the Company (FRP) has a Joint Venture Agreement with Vulcan Materials Company (formerly Florida Rock Industries, Inc.) to 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 the property until 2018 and pay royalties for the benefit of FRP for as long as mining does not interfere with the development of the property. Real estate revenues included $217,000 of such royalties in fiscal 2014 and $206,000 in fiscal 2013. Allocated depletion expense of $7,000 was included in real estate cost of operations for fiscal 2014. 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. The joint venture is jointly controlled by Vulcan and FRP, and they each had a mandatory obligation to fund additional capital contributions of up to $2,380,000. Capital contributions of $2,312,000 have been made by each party as of September 30, 2014. Distributions will be made on a 50-50 basis except for royalties and depletion specifically allocated to FRP. Other income for fiscal 2014 includes a loss of $39,000 representing the Company’s equity in the loss of the 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 in August 2012.

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 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	)
As of September 30, 2013
Riverfront Holdings I, LLC	88.82	%	$  5,894	$   7,745	$   (22	)	$   (22	)
Brooksville Quarry, LLC	50.00	%	7,512	14,356	(82	)	(41	)
Total			$ 13,406	$  22,101	$  (104	)	$   (63	)

Summarized Unaudited Financial Information for the Investments in Joint Ventures (in thousands):

	Years Ended September 30,
		2014		2013
Cash	$	208	$	18
Cash held in escrow		18,822		—
Amortizable Debt Costs		2,069		—
Investments in real estate, net.		27,088		22,083
Total Assets	$	48,187	$	22,101
Other Liabilities	$	313	$	214
Long-term Debt		17,000		—
Capital - FRP		18,537		13,406
Capital - Third Parties		12,337		8,481
Total Liabilities and Capital	$	48,187	$	22,101

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Concentrations

12 Months Ended

Sep. 30, 2014

Risks and Uncertainties [Abstract]

Concentrations

14. Concentrations.

The transportation segment primarily serves customers in the petroleum industry in the Southeastern U.S. Significant economic disruption or downturn in this geographic region or these industries could have an adverse effect on our financial statements.

During fiscal 2014, the transportation segment’s ten largest customers accounted for approximately 54.7% of the transportation segment’s revenue. One of these customers accounted for 20.9% of the transportation segment’s revenue. The loss of any one of these customers would have an adverse effect on the Company’s revenues and income. Accounts receivable from the transportation segment’s ten largest customers was $4,075,000 and $3,565,000 at September 30, 2014 and 2013, respectively.

The mining royalty land segment has one lessee that accounted for 66.8% of the segment’s revenues and $216,000 of accounts receivable at September 30, 2014. The termination of certain of this lessee’s underlying leases could have a material adverse effect on the segment.

The Company places its cash and cash equivalents with high credit quality institutions. At times, such amounts may exceed FDIC limits.

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Business Segments

12 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

Business Segments

10. Business Segments.

The Company operates in three reportable business segments. The Company’s operations are substantially in the Southeastern and Mid-Atlantic states.

The transportation segment hauls petroleum and other liquids and dry bulk commodities by tank trailers. The Company’s real estate operations consist of two reportable segments. The Mining royalty land segment owns real estate including construction aggregate royalty sites and parcels held for investment. The Developed property rentals segment acquires, constructs, and leases office/warehouse buildings primarily in the Baltimore/Northern Virginia/Washington area and holds real estate for future development or related to its developments.

The Company’s transportation and real estate groups operate independently and have minimal shared overhead except for corporate expenses. Corporate expenses are allocated in fixed quarterly amounts based upon budgeted and estimated proportionate cost by segment. Unallocated corporate expenses primarily include stock compensation and corporate aircraft expenses. Reclassifications to prior period amounts have been made to be comparable to the current presentation.

Operating results and certain other financial data for the Company’s business segments are as follows (in thousands):

		2014		2013		2012
Revenues:
Transportation	$	129,162		112,120		103,476
Mining royalty land		5,349		5,302		4,483
Developed property rentals		25,629		22,352		19,555
	$	160,140		139,774		127,514
Operating profit:
Transportation	$	8,027		11,119		9,107
Mining royalty land		4,736		4,739		3,905
Developed property rentals		10,228		9,427		5,497
Corporate expenses:
Allocated to transportation		(1,721	)	(1,765	)	(1,631	)
Allocated to mining land		(755	)	(731	)	(674	)
Allocated to developed property		(1,133	)	(1,094	)	(1,012	)
Unallocated		(1,614	)	(1,261	)	(1,091	)
		(5,223	)	(4,851	)	(4,408	)
	$	17,768		20,434		14,101
Interest expense:
Mining royalty land	$	44		59		40
Developed property rentals		1,431		2,461		2,598
	$	1,475		2,520		2,638
Capital expenditures:
Transportation (a)	$	13,028		15,612		10,459
Mining royalty land		—		—		11,039
Developed property rentals:
Capitalized interest		1,763		1,863		1,646
Internal labor		469		418		609
Real estate taxes (b)		112		904		(1,209	)
Other costs		16,939		19,751		11,804
	$	32,311		38,548		34,348
(a)Includes $3,397 related to the Pipeline Transportation, Inc.    acquisition during fiscal 2014. (b)Includes a $2,311 receivable on previously capitalized real estate
taxes on the Anacostia property for fiscal 2012.
Depreciation, depletion and
amortization:
Transportation	$	8,813		7,401		6,750
Mining royalty land		124		105		112
Developed property rentals		6,721		6,141		5,729
Other		481		418		403
	$	16,139		14,065		12,994
Identifiable net assets at September 30:
Transportation	$	59,465		49,410		42,642
Mining royalty land		39,368		40,008		39,695
Developed property rentals		211,556		195,476		184,358
Cash items		1,013		502		6,713
Unallocated corporate assets		1,669		1,697		2,297
		313,071		287,093		275,705

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Earnings Per Share

12 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

Earnings Per Share

6. Earnings Per Share.

The following details the computations of the basic and diluted earnings per common share. (Dollars in thousands, except per share amounts.)

	Years Ended September 30
	2014		2013		2012
Common shares:
Weighted average common shares
outstanding during the period -
shares used for basic earnings
per common share		9,629		9,523		9,360
Common shares issuable under share
based payment plans which are
potentially dilutive		81		82		114
Common shares used for diluted
earnings per common share		9,710		9,605		9,474
Net income	$	10,019		15,385		7,808
Earnings per common share
Basic	$	1.04		1.62		.83
Diluted	$	1.03		1.60		.82

For 2014, 2013 and 2012, 31,790, 87,550, and 164,560 shares, respectively, attributable to outstanding stock options were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.

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Transportation Business Acquisition (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Nov. 07, 2013
Property and equipment			$ 3,397
Prepaid tires and other prepaid assets			276
Customer relationships			4,004
Trade name			72
Non-compete agreement			62
Vacation liability assumed			(132)
Total identifiable net assets assumed			7,679
Goodwill	2,344	0
Total Transportation Acquisition			10,023
Transportation Business Acquisition
Fair value of consideration transferred (cash paid)	(10,023)
Acquisition related costs expensed	75
Goodwill	$ 2,344

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Leases

12 Months Ended

Sep. 30, 2014

Leases [Abstract]

Leases

4. Leases.

At September 30, 2014, the total carrying value of property owned by the Company which is leased or held for lease to others is summarized as follows (in thousands):

Construction aggregates property	$	35,087
Commercial property		250,056
		285,143
less accumulated depreciation and depletion		66,920
	$	218,223

The minimum future straight-lined rentals due the Company on noncancelable leases as of September 30, 2014 are as follows: 2015 - $22,240,000; 2016 - $18,584,000; 2017 - $15,824,000; 2018 - $12,885,000; 2019 - $9,525,000; 2020 and subsequent years $33,804,000.

The Company leases certain assets under operating leases, which primarily consist of real estate leases for the corporate office and some of our terminal locations. Certain operating leases provide for renewal options, which can vary by lease and are typically offered at their fair rental value. The Company has not made any residual value guarantees related to its operating leases; therefore, there is no corresponding liability recorded on the Balance Sheets.

Future minimum annual lease payments for assets under operating leases as of September 30, 2014 are as follows (in thousands):

Fiscal Year	Total
2015	$	393
2016	278
2017	278
2018	278
2019	278
Thereafter	995
Total minimum lease payments	$	2,500

Aggregate expense under operating leases was $738,000, $634,000 and $583,000 for 2014, 2013 and 2012, respectively. Certain operating leases include rent escalation provisions, which are recognized as expense on a straight-line basis.

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Spin-off

12 Months Ended

Sep. 30, 2014

Notes to Financial Statements

Spin-off

5. Spin-off.

On May 7, 2014, the Company announced that it planned to separate its transportation business into an independent publicly traded company through a tax free spin-off of the transportation business to FRP shareholders. The separation, which is subject to a number of conditions including final Board approval, receipt of an opinion of tax counsel and effectiveness of a registration statement on Form 10, is expected to be completed in the next 5 months.

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Stock-Based Compensation Plans

12 Months Ended

Sep. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation Plans

7. Stock-Based Compensation Plans.

The Company has two Stock Option Plans (the 2000 Stock Option Plan and the 2006 Stock Option Plan) under which options for shares of common stock were granted to directors, officers and key employees. The 2006 plan permits the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, or stock awards. The options awarded under the plans have similar characteristics. All stock options are non-qualified and expire ten years from the date of grant. Stock based compensation awarded to directors, officers and employees are exercisable immediately or become exercisable in cumulative installments of 20% or 25% at the end of each year following the date of grant. When stock options are exercised the Company issues new shares after receipt of exercise proceeds and taxes due, if any, from the grantee. The number of common shares available for future issuance was 486,590 at September 30, 2014.

The Company utilizes the Black-Scholes valuation model for estimating fair value of stock compensation for options awarded to officers and employees. Each grant is evaluated based upon assumptions at the time of grant. The assumptions were no dividend yield, expected volatility between 37% and 46%, risk-free interest rate of .3% to 4.2% and expected life of 3.0 to 7.0 years.

The dividend yield of zero is based on the fact that the Company does not pay cash dividends and has no present intention to pay cash dividends. Expected volatility is estimated based on the Company’s historical experience over a period equivalent to the expected life in years. The risk-free interest rate is based on the U.S. Treasury constant maturity interest rate at the date of grant with a term consistent with the expected life of the options granted. The expected life calculation is based on the observed and expected time to exercise options by the employees.

The Company recorded the following stock compensation expense in its consolidated statement of income (in thousands):

	Years Ended September 30
	2014		2013		2012
Stock option grants	$	441		376		381
Annual non-employee Director stock award		698		507		320
	$	1,139		883		701

A summary of changes in outstanding options is presented below:

				Weighted		Weighted		Weighted
	Number			Average		Average		Average
	of			Exercise		Remaining		Grant Date
Options	Shares			Price		Term (yrs)		Fair Value(000's)
Outstanding at
October 1, 2011		606,025		$	14.96		3.5	$	4,216
Granted		31,690		$	22.25			$	281
Exercised		(153,505	)	$	8.62			$	(705	)
Forfeited		(3,000	)	$	5.78			$	(10	)
Outstanding at
September 30, 2012		481,210		$	17.52		3.8	$	3,782
Granted		46,180		$	26.20			$	489
Exercised		(112,800	)	$	10.52			$	(603	)
Forfeited		—		$	—			$	—
Outstanding at
September 30, 2013		414,590		$	20.40		4.2	$	3,668
Granted		31,790		$	41.39			$	545
Exercised		(119,550	)	$	12.23			$	(732	)
Forfeited		—		$	—			$	—
Outstanding at
September 30, 2014		326,830		$	25.43		5.0	$	3,481
Exercisable at
September 30, 2014		244,476		$	23.82		4.0	$	2,398
Vested during
twelve months ended
September 30, 2014		33,148						$	372

The following table summarizes information concerning stock options outstanding at September 30, 2014:

	Shares	Weighted			Weighted
Range of Exercise	under	Average			Average
Prices per Share	Option	Exercise Price			Remaining Life
Non-exercisable:
$16.51 – $24.75	14,514			22.25		7.2
$24.76 - $37.25	43,550			26.62		7.5
$37.26 - $41.39	24,290			41.39		9.2
	82,354		$	30.21		8.0	years
Exercisable:
$11.00 - $16.50	55,800			14.92		0.4
$16.51 - $24.75	68,176			22.57		4.1
$24.76 - $37.25	113,000			27.79		5.3
$37.26 - $41.39	7,500			41.39		9.2
	244,476		$	23.82		4.0	years
Total	326,830		$	25.43		5.0	years

The aggregate intrinsic value of exercisable in-the-money options was $2,526,000 and the aggregate intrinsic value of outstanding in-the-money options was $3,014,000 based on the market closing price of $33.92 on September 30, 2014 less exercise prices. Gains of $2,918,000 were realized by option holders during the twelve months ended September 30, 2014. The realized tax benefit from options exercised for the twelve months ended September 30, 2014 was $1,129,000. Total compensation cost of options granted but not yet vested as of September 30, 2014 was $814,000, which is expected to be recognized over a weighted-average period of 3.3 years.

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Intangible assets and liabilities (Details) (Parenthetical)	12 Months Ended
	Sep. 30, 2014
In place leases
Useful life	7-8 years
Above Market leases
Useful life	5 years
Customer Value
Useful life	10.5 years
Trade name
Useful life	5 years
Non Compete
Useful life	3.5 years
Below market leases
Useful life	4-5 years

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Schedule III Real Estate and Accumulated Depreciation and Depletion Part 2 (Details)	12 Months Ended
	Sep. 30, 2014
Alachua, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Clayton, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Fayette, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Lake, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Lake Louise, FL
Year of Construction	n/a
Date acquired	5/12
Depreciation Life Computed on	unit
Lee, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Monroe, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Muscogee, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Prince Wil, VA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Putnam, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Wash DC 1
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	15 yr.
Wash DC 2
Year of Construction	n/a
Date acquired	10/97
Depreciation Life Computed on	n/a
Putnam, FL 2
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	5 yr.
Spalding, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	n/a
Lake, FL 2
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Marion, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Baltimore, MD 1
Year of Construction	1990
Date acquired	10/89
Depreciation Life Computed on	39 yr.
Baltimore, MD 2
Year of Construction	1994
Date acquired	12/91
Depreciation Life Computed on	39 yr.
Baltimore, MD 3
Year of Construction	2000
Date acquired	7/99
Depreciation Life Computed on	39 yr.
Baltimore, MD 4
Year of Construction	2008
Date acquired	12/02
Depreciation Life Computed on	39 yr.
Baltimore, MD 5
Year of Construction	n/a
Date acquired	6/14
Depreciation Life Computed on	39 yr.
Baltimore City, MD
Year of Construction	2010
Date acquired	12/10
Depreciation Life Computed on	39 yr.
Baltimore City, MD 2
Year of Construction	n/a
Date acquired	6/13
Depreciation Life Computed on	39 yr.
Duval, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	25 yr.
Harford, MD 1
Year of Construction	1998
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 2
Year of Construction	1999
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 3
Year of Construction	2001
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 4
Year of Construction	n/a
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 5
Year of Construction	2007
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 6
Year of Construction	2009
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Howard, MD 1
Year of Construction	1996
Date acquired	9/88
Depreciation Life Computed on	39 yr.
Howard, MD 2
Year of Construction	2000
Date acquired	3/00
Depreciation Life Computed on	39 yr.
Anne Arun, MD 1
Year of Construction	1989
Date acquired	9/88
Depreciation Life Computed on	39 yr.
Anne Arun, MD 2
Year of Construction	2003
Date acquired	5/98
Depreciation Life Computed on	39 yr.
Anne Arun, MD 3
Year of Construction	2005
Date acquired	8/04
Depreciation Life Computed on	39 yr.
Anne Arun, MD 4
Year of Construction	2006
Date acquired	1/03
Depreciation Life Computed on	39 yr.
Anne Arun, MD 5
Year of Construction	2012
Date acquired	7/07
Depreciation Life Computed on	39 yr.
Norfolk, VA
Year of Construction	2004
Date acquired	10/04
Depreciation Life Computed on	39 yr.
Prince Wil, VA 2
Year of Construction	n/a
Date acquired	12/05
Depreciation Life Computed on	39 yr.
Newcastle Co, DE
Year of Construction	2004
Date acquired	4/04
Depreciation Life Computed on	39 yr.
Carroll, MD
Year of Construction	n/a
Date acquired	3/08
Depreciation Life Computed on	n/a
Investment Property
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	n/a

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Intangible assets and liabilities (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2014	Sep. 30, 2013
In place leases
Gross Carrying Amount	$ 1,385	$ 806
Accumulated Amortization	570	121
Above Market leases
Gross Carrying Amount	48	48
Accumulated Amortization	15	3
Customer Value
Gross Carrying Amount	4,004	0
Accumulated Amortization	350	0
Trade name
Gross Carrying Amount	72	0
Accumulated Amortization	19	0
Non Compete
Gross Carrying Amount	62	0
Accumulated Amortization	11	0
Below market leases
Gross Carrying Amount	220	156
Accumulated amortization	$ 118	$ 24

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Debt (Tables)

12 Months Ended

Sep. 30, 2014

Debt Disclosure [Abstract]

Debt

(in thousands)	2014		2013
Revolving credit (uncollateralized)	$	17,645		—
5.6% to 8.6% mortgage notes
due in installments through 2027		45,593		49,904
		63,238		49,904
Less portion due within one year		4,534		4,311
	$	58,704		45,593

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Stock-Based Compensation Plans - Summary of Stock Activity (Details) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2011
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Options outstanding at beginning of period	414,590	481,210	606,025
Options granted	31,790	46,180	31,690
Options exercised	119,550	112,800	153,505
Options forfeited	0	0	3,000
Options outstanding at end of period	326,830	414,590	481,210	606,025
Options outstanding weighted average exercise price at beginning of period	$ 20.40	$ 17.52	$ 14.96
Options outstanding weighted average exercise price - Granted	$ 41.39	$ 26.20	$ 22.25
Options outstanding weighted average exercise price - Exercised	$ 12.23	$ 10.52	$ 8.62
Options outstanding weighted average exercise price - forfeited	$ 0	$ 0	$ 5.78
Options outstanding weighted average exercise price at end of period	$ 25.43	$ 20.40	$ 17.52	$ 14.96
Options outstanding weighted average remaining term	5.0	4.2	3.8	3.5
Options outstanding weighted average grant date fair value at beginning of period	$ 3,668	$ 3,782	$ 4,216
Options outstanding weighted average grant date fair value	545	489	281
Options exercised weighted average grant date fair value	732	603	705
Options forfeited weighted average grant date fair value	0	0	10
Options outstanding weighted average grant date fair value at end of period	3,481	3,668	3,782	4,216
Options exercisable at September 30, 2014	244,476
Options exercisable weighted average exercise price	$ 23.82
Options exercisable weighted average remaining term	4.0
Options exercisable weighted average grant date fair value	2,398
Options vested during twelve months ended September 30, 2014	33,148
Options vested weighted average grant date fair value	$ 372

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Contingent Liabilities

12 Months Ended

Sep. 30, 2014

Notes to Financial Statements

Contingent Liabilities

12. Contingent Liabilities.

Certain of the Company’s subsidiaries are involved in litigation on a number of matters and are subject to certain claims which arise in the normal course of business. The Company has retained certain self-insurance risks with respect to losses for third party liability and property damage. There is a reasonable possibility that the Company’s estimate of vehicle and workers’ compensation liability for the transportation segment or discontinued operations may be understated or overstated but the possible range can not be estimated. The liability at any point in time depends upon the relative ages and amounts of the individual open claims. In the opinion of management, none of these matters are expected to have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows.

Preliminary testing on the site of the Company's four phase master development known as Riverfront on the Anacostia in Washington, D.C. indicated the presence of contaminated material that will have to be specially handled upon excavation in conjunction with construction. The Company has agreed with our joint venture partner to bear the cost of handling the contaminated materials on the first phase of this development up to a cap of $1.871 million. We recorded an expense in the fourth quarter of fiscal 2012 of $1,771,000 for this environmental remediation liability which is the lower end of the range of estimates. The Company has no obligation to remediate this contamination on Phases II, III and IV of the development until such time as it makes a commitment to commence construction there. The Company's position is that the prior tenant on the property is responsible for the cost of removal of the contaminated materials. The Company's actual expense to address this issue may be materially higher or lower than the expense previously recorded depending upon the actual costs incurred and any reimbursement that we receive from the prior tenant.

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Unusual or Infrequent Items Impacting Quarterly Results

12 Months Ended

Sep. 30, 2014

Extraordinary and Unusual Items [Abstract]

Unusual or Infrequent Items Impacting Quarterly Results

17. Unusual or Infrequent Items Impacting Quarterly Results.

Income from continuing operations for the first quarter of fiscal 2012 included a gain on termination of sale contract in the amount of $1,039,000 before income taxes for the receipt of non-refundable deposits related to the termination of an agreement to sell the Company’s Windlass Run Residential property.

Operating profit for the developed property rentals segment includes an expense in the fourth quarter of fiscal 2012 of $1,771,000 for an estimated environmental remediation liability which is the lower end of the range of estimates. The actual expense may be materially higher or lower depending upon the actual costs incurred and any reimbursement that we receive from the prior tenant.

In November 2012 the Company sold its Commonwealth property in Jacksonville, Florida resulting in gain of $1,116,000 before income taxes. The book value of the property was $723,000.

On June 3, 2013 the Company prepaid the $7,281,000 remaining principal balance on a 6.12% mortgage under an early prepayment provision the note allowed after 7.5 years. The prepayment penalty of $382,000 is included in interest expense. The remaining deferred loan costs of $175,000 were also included in interest expense. On July 31, 2013 the Company prepaid the $279,000 remaining principal balance on a 7.97% mortgage. The cost of the prepayment included a penalty of $7,000.

In July 2013 the Company sold 15.18 acres of land at Patriot Business Park for a sales price of $4,775,000 resulting in a gain of $341,000 before income taxes. The book value of the property was $3,603,000. At September 30, 2014 cash held in escrow included $61,000 related to future obligations of the Company pertaining to this sale which will be satisfied during fiscal 2015.

In August 2013 the Company sold 5.38 acres of land at Hollander 95 Business Park and recorded a gain before income taxes of $514,000. The book value of the property was $595,000. In August 2013 the Company sold phase 1 of the Windlass Run Residential property and recorded a gain of $4,928,000 before income taxes. The book value of the property was $2,971,000. The Company also sold 284 acres of Gulf Hammock mining property in August 2013 and recorded a gain of $433,000 before income taxes. The book value of the property was $296,000.

Sales, general & administrative expense for the fourth quarter of fiscal 2014 includes a $575,000 unfavorable adjustment to the actuarially assumed expense due to the death prior to retirement of one of the Management Security Plan participants.

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Earnings Per Share - Earnings per share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013	Sep. 30, 2012
Earnings Per Share [Abstract]
Weighted average common shares oustanding during the period-shares used for basic earnings per common share	9,629	9,523	9,360
Common shares issuable under share based payment plans which are potentially dilutive	81	82	114
Common shares used for diluted earnings per common share	9,710	9,605	9,474
Net income	$ 10,019	$ 15,385	$ 7,808
Basic	$ 1.04	$ 1.62	$ 0.83
Diluted	$ 1.03	$ 1.60	$ 0.82

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Real Estate Business Park Acquisitions (Tables)

12 Months Ended

Sep. 30, 2014

Transit Business Park

Intangible asset amortization

(in thousands)		In-place	Above Market	Below Market
		Leases	Leases	Leases
Initial Values	$	806	48	156
Annual Amortization:
2013	$	121	3	24
2014		369	12	86
2015		78	11	37
2016		64	11	9
2017		62	11	—
2018		35	—	—
2019		34	—	—
2020		34	—	—
2021		9	—	—

Kelso Business Park

Intangible asset amortization

(in thousands)		In-place	Below Market
		Leases	Leases
Initial Values	$	579	64
Annual Amortization:
2014		80	8
2015		218	21
2016		133	21
2017		96	12
2018		25	2
2019		18	—
2020		9	—

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013		Sep. 30, 2012
Cash flows from operating activities:
Net income	$ 10,019	$ 15,385		$ 7,808
Adjustments to reconcile net income to net cash provided by continuing operating activities:
Depreciation, depletion and amortization	16,139	14,065		12,994
Deferred income taxes	(801)	4,437		1,539
Equity in loss of joint ventures	128	63		8
Gain on sale of equipment and property	(1,063)	(8,889)		(2,332)
Income from discontinued operations, net	0	0		(97)
Stock-based compensation	1,139	883		701
Net changes in operating assets and liabilities:
Accounts receivable	1,037	47		(317)	[1]
Inventory of parts and supplies	(14)	(38)		278
Prepaid expenses and other current assets	(298)	1,340		(685)
Other assets	(1,891)	(1,595)		(1,899)
Accounts payable and accrued liabilities	(433)	619	[2]	1,572
Income taxes payable and receivable	226	901		(333)
Long-term insurance liabilities and other long-term liabilities	(834)	(340)		1,070
Net cash provided by operating activities of continuing operations	23,354	26,878		20,307
Net cash provided by operating activities of discontinued operations	0	0		177
Net cash provided by operating activities	23,354	26,878		20,484
Cash flows from investing activities:
Purchase of transportation group property and equipment	(9,631)	(15,612)		(10,459)
Investments in mining royalty land segment	0	0		(11,039)
Investments in developed property rentals segment	(19,283)	(22,936)		(12,850)
Transportation group business acquisition	(10,023)	0		0
Investment in joint ventures	(5,266)	(116)		(125)
Cash held in escrow	1,508	(1,569)		0
Proceeds from the sale of real estate held for investment, property, plant and equipment	3,324	17,708	[2]	2,817
Net cash used in investing activities	(39,371)	(22,525)		(31,656)
Cash flows from financing activities:
Increase in bank overdrafts	685	248		0
Repayment of long-term debt	(4,311)	(12,466)		(4,902)
Repurchase of Company Stock	0	(233)		(315)
Proceeds from borrowing on revolving credit facility	30,945	7,300		0
Payment on revolving credit facility	(13,300)	(7,300)		0
Excess tax benefits from exercises of stock options and vesting of restricted stock	1,047	701		754
Exercise of employee stock options	1,462	1,186		1,322
Net cash provided by (used in) financing activities	16,528	(10,564)		(3,141)
Net increase (decrease) in cash and cash equivalents	511	(6,211)		(14,313)
Cash and cash equivalents at beginning of year	502	6,713		21,026
Cash and cash equivalents at end of the year	1,013	502		6,713
Supplemental disclosures of cash flow information:
Cash paid during the year for interest, net of capitalized amounts	1,475	2,520		2,638
Cash paid during the year for income taxes	$ 6,180	$ 3,803		$ 3,717

[1] The Company recorded non-cash transactions in 2012 for a $2,311 receivable on previously capitalized real estate taxes on the Anacostia property.

[2] The Company recorded a $334 non-cash transaction for accrued liabilities of deferred gains and post sale obligations related to investment land sold in 2013.

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Accounting Policies

12 Months Ended

Sep. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Accounting Policies

1. Accounting Policies.

ORGANIZATION - FRP Holdings, Inc. (Company) is engaged in the transportation and real estate businesses. The Company’s transportation business is conducted through its subsidiary, Florida Rock & Tank Lines, Inc. (Tank Lines). Tank Lines is a Southeastern transportation company concentrating in the hauling by motor carrier of primarily petroleum related bulk liquids and dry bulk commodities. The Company’s real estate group, through subsidiaries, acquires, constructs, leases, operates and manages land and buildings to generate both current cash flows and long-term capital appreciation. The real estate group also owns real estate that is leased under mining royalty agreements or held for investment.

CONSOLIDATION - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Investments in the Brooksville joint venture and Riverfront Investment Partner I, LLC are accounted for under the equity method of accounting (See Note 2). All significant intercompany transactions have been eliminated in consolidation.

CASH AND CASH EQUIVALENTS - The Company considers all highly liquid debt instruments with maturities of three months or less at time of purchase to be cash equivalents. Bank overdrafts consist of outstanding checks not yet presented to a bank for settlement, net of cash held in accounts with right of offset. Bank overdrafts of $933,000 and $248,000 are included in Accounts payable as of September 30, 2014 and 2013 respectively.

INVENTORY - Inventory of parts and supplies is valued at the lower of cost (first-in, first-out) or market.

TIRES ON EQUIPMENT - The value of tires on tractors and trailers is accounted for as a prepaid expense and amortized over the life of the tires as a function of miles driven.

REVENUE AND EXPENSE RECOGNITION - Transportation revenue, including fuel surcharges, is recognized when the services have been rendered to customers or delivery has occurred, the pricing is fixed or determinable and collectibility is reasonably assured. Transportation expenses are recognized as incurred.

Real estate rental revenue and mining royalties are generally recognized when earned under the leases. Rental income from leases with scheduled increases or other incentives during their term is recognized on a straight-line basis over the term of the lease. Reimbursements of expenses, when provided in the lease, are recognized in the period that the expenses are incurred.

Sales of real estate are recognized when the collection of the sales price is reasonably assured and when the Company has fulfilled substantially all of its obligations, which are typically as of the closing date.

Accounts receivable are recorded net of discounts and provisions for estimated allowances. We estimate allowances on an ongoing basis by considering historical and current trends. We record estimated bad debts expense as a selling, general and administrative expense. We estimate the net collectibility of our accounts receivable and establish an allowance for doubtful accounts based upon this assessment. Specifically, we analyze the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms.

PROPERTY AND EQUIPMENT - Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

Years

Buildings and improvements 7-39

Revenue equipment          7-10

Other equipment            3-10

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves. Reserve estimates are periodically adjusted based upon surveys.

The Company recorded depreciation and depletion expenses for 2014, 2013 and 2012 of $14,426,000, $12,856,000, and $12,250,000, respectively.

All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property. Included in indirect costs is an allocation of internal costs associated with development of real estate investments. The cost of routine repairs and maintenance to property and equipment is expensed as incurred.

IMPAIRMENT OF LONG-LIVED ASSETS – The Company periodically reviews its long-lived assets, which include property and equipment and purchased intangible assets subject to amortization for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. The review of real estate group assets consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures. The review of the transportation segment assets consists of a review of future anticipated results considering business prospects and asset utilization. If the sum of these future cash flows (undiscounted and without interest charges) is less than the carrying amount of the assets, the Company would record an impairment loss based on the fair value of the assets with the fair value of the assets generally based upon an estimate of the discounted future cash flows expected with regards to the assets and their eventual disposition.

GOODWILL – Goodwill represents the excess of the purchase price over the estimated fair value of the net assets acquired in the acquisition of a business. Goodwill is not amortized, but rather is tested for impairment annually and when events or changes in circumstances indicate that the fair value of a reporting unit with goodwill has been reduced below carrying value. The impairment test requires allocating goodwill and other assets and liabilities to reporting units. The fair value of each reporting unit is determined and compared to the book value of the reporting unit. If the fair value of the reporting unit is less than the book value, including goodwill, then the recorded goodwill is impaired to its implied fair value with a charge to operating expense.

DEVELOPED PROPERTY RENTALS PURCHASE ACCOUNTING – Acquisitions of rental property, including any associated intangible assets, are measured at fair value at the date of acquisition. Any liabilities assumed or incurred are recorded at their fair value at the time of acquisition. The fair value of the acquired property is allocated between land and building (on an as-if vacant basis) based on management’s estimate of the fair value of those components for each type of property and to tenant improvements based on the depreciated replacement cost of the tenant improvements, which approximates their fair value. The fair value of the in-place leases is recorded as follows:

· the fair value of leases in-place on the date of acquisition is based on absorption costs for the estimated lease-up period in which vacancy and foregone revenue are avoided due to the presence of the acquired leases;

· the fair value of above and below-market in-place leases based on the present value (using a discount rate that reflects the risks associated with the acquired leases) of the difference between contractual rent amounts to be paid under the assumed lease and the estimated market lease rates for the corresponding spaces over the remaining non-cancelable terms of the related leases; and

· the fair value of intangible tenant or customer relationships.

The Company’s determination of these fair values requires it to estimate market rents for each of the leases and make certain other assumptions. These estimates and assumptions affect the rental revenue, and depreciation and amortization expense recognized for these leases and associated intangible assets and liabilities.

INVESTMENTS - The Company uses the equity method to account for its investment in Brooksville, in which it has a voting interest of 50% and has significant influence but does not have control. The Company uses the equity method to account for its investment in Riverfront Investment Partners I, LLC, in which the equity interest will be determined based on leverage of the entity, additional cash contributions by the Company, and negotiations with potential third partners. Under the equity method, the investment is originally recorded at cost and adjusted to recognize the Company’s share of net earnings or losses of the investee, limited to the extent of the Company’s investment in and advances to the investee and financial guarantees on behalf of the investee that create additional basis. The Company regularly monitors and evaluates the realizable value of its investments. When assessing an investment for an other-than-temporary decline in value, the Company considers such factors as, the performance of the investee in relation to its own operating targets and its business plan, the investee’s revenue and cost trends, as well as liquidity and cash position, and the outlook for the overall industry in which the investee operates. From time to time, the Company may consider third party evaluations or valuation reports. If events and circumstances indicate that a decline in the value of these assets has occurred and is other-than-temporary, the Company records a charge to investment income (expense).

INSURANCE – The Company has a $250,000 to $500,000 self-insured retention per occurrence in connection with certain of its workers’ compensation, automobile liability, and general liability insurance programs ("risk insurance"). The Company is also self-insured for its employee health insurance benefits and carries stop loss coverage for losses over $250,000 per covered participant per year plus a $72,000 aggregate. The Company has established an accrued liability for the estimated cost in connection with its portion of its risk and health insurance losses incurred and reported. Claims paid by the Company are charged against the liability. Additionally, the Company maintains an accrued liability for incurred but not reported claims based on historical analysis of such claims. The method of calculating the accrual liability is subject to inherent uncertainty. If actual results are less favorable than the estimates used to calculate the liabilities, the Company would have to record expenses in excess of what has been accrued. Accrued insurance liabilities decreased due to payments to our new insurer under a captive agreement along with payment in settlement of three unusually large prior year liability and health claims. Payments under the captive agreement are for the fiscal 2013 year-to-date loss fund as estimated in advance using actuarial methodology. The captive agreement provides that we will share in the underwriting results, good or bad, within a $250,000 per occurrence layer of loss through retrospective premium adjustments.

INCOME TAXES - Deferred tax assets and liabilities are recognized based on differences between financial statement and tax bases of assets and liabilities using presently enacted tax rates. Deferred income taxes result from temporary differences between pre-tax income reported in the financial statements and taxable income. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination of the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of limitations, effectively settled issues under audit, and audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. It is the Company's policy to recognize as additional income tax expense the items of interest and penalties directly related to income taxes.

STOCK BASED COMPENSATION – The Company accounts for compensation related to share based plans by recognizing the grant date fair value of stock options and other equity-based compensation issued to employees in its income statement over the requisite employee service period using the straight-line attribution model. In addition, compensation expense must be recognized for the change in fair value of any awards modified, repurchased or cancelled after the grant date. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used in the model and current year impact is discussed in Footnote 7.

PENSION PLAN - The Company accounts for its pension plan following the requirements of FASB ASC Topic 715, “Compensation – Retirement Benefits”, which requires an employer to: (a) recognize in its statement of financial position the funded status of a benefit plan; (b) measure defined benefit plan assets and obligations as of the end of the employer's fiscal year (with limited exceptions); and (c) recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise but are not recognized as components of net periodic benefit costs pursuant to prior existing guidance.

EARNINGS PER COMMON SHARE - Basic earnings per common share are based on the weighted average number of common shares outstanding during the periods. Diluted earnings per common share are based on the weighted average number of common shares and potential dilution of securities that could share in earnings. The differences between basic and diluted shares used for the calculation are the effect of employee and director stock options and restricted stock.

USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United State requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain accounting policies and estimates are of more significance in the financial statement preparation process than others. The most critical accounting policies and estimates include the economic useful lives and salvage values of our vehicles and equipment, provisions for uncollectible accounts receivable and collectibility of unrealized rents and notes receivable, estimates of exposures related to our insurance claims plans, and estimates for taxes. To the extent that actual, final outcomes are different than these estimates, or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting period will be affected.

ENVIRONMENTAL - Environmental expenditures that benefit future periods are capitalized. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded for the estimated amount of expected environmental assessments and/or remedial efforts. Estimation of such liabilities includes an assessment of engineering estimates, continually evolving governmental laws and standards, and potential involvement of other potentially responsible parties.

COMPREHENSIVE INCOME – Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) refers to expenses, gains, and losses that are not included in net income, but rather are recorded directly in shareholder’s equity.

RECENTLY ISSUED ACCOUNTING STANDARDS – In April 2014, the FASB issued ASU 2014-08, "Presentation of Financial Statements and Property, Plant, and Equipment - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." ASU 2014-08 changes the definition of a discontinued operation to include only those disposals of components of an entity that represent a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. The ASU also expands the disclosure requirements for transactions that meet the definition of a discontinued operation and requires entities to disclose information about individually significant components that are disposed of or held for sale and do not qualify as discontinued operations. This new guidance is effective for annual periods beginning on or after December 15, 2014 and interim periods within those years, with early adoption permitted. Effective second quarter 2014, the Company adopted ASU 2014-08 and will apply the new guidance, as applicable, to future disposals of components or classifications as held for sale.

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Real Estate Transit Business Park Acquisition (Details) (Transit Business Park, USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013	Jun. 20, 2013
Transit Business Park
In-place leases initial value										$ 806
Above market leases initial value										48
Below market leases initial values										156
In-place Leases	9	34	34	35	62	64	78	369	121
Above Market Leases					11	11	11	12	3
Below Market Leases						$ 9	$ 37	$ 86	$ 24

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Transportation Business Acquisition (Details Narrative) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Jun. 30, 2013	Sep. 30, 2014	Nov. 07, 2013
Pipeline Transportation, Inc assets acquired			$ 10,023
Pipeline gross revenues	16,500
Operating leases minimum future annual rentals		2,500
Transportation Business Acquisition
Operating leases minimum future annual rentals		2,258
Non-cancellable operating lease remaining period		3.1
Amortization of intangible assets		$ 2,010

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Debt (Details Narrative) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 30, 2014	Sep. 30, 2013 7001 Dorsey Rd Years	Sep. 30, 2013 Oregon Center
Lowest interest rate on mortgage notes	5.60%
Highest interest rate on mortgage notes	8.60%
Principal payments 2015	$ 4,534
Principal payments 2016	4,616
Principal payments 2017	4,887
Principal payments 2018	4,674
Principal payments 2019	3,885
Principal payments 2020 and subsequent years	22,997
Credit Agreement term years	5
Revolving Credit Agreement	55,000
Revolving credit facility	40,000
Sublimit for standby letters of credit	20,000
Term loan facility	15,000
Revolver interest over LIBOR	1%
Commitment fee	0.15%
Letters of credit issued	5,421
Borrowed under the revolver	17,645
Available for borrowing	31,934
Consolidated retained earnings available for payment of dividends	73,558
Carrying value of collateral on mortgage notes payable	57,146
Mortgage prepayment		7,281	279
Rate of prepayed mortgage		6.12%	7.97%
Early prepayment provision in years		7.5
Prepayment penalty		382	7
Deferred loan costs on early prepayment		$ 175

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Real Estate Business Park Acquisitions

12 Months Ended

Sep. 30, 2014

Business Combinations [Abstract]

Real Estate Business Park Acquisitions

18. Real Estate Business Park Acquisitions.

TRANSIT BUSINESS PARK - On June 20, 2013, the Company purchased for approximately $8 million, Transit Business Park in Baltimore, Maryland which consists of 5 buildings on 14.5 acres totaling 232,318 square feet. The Company has accounted for this acquisition in accordance with the provisions of ASC 805, Business Combinations (ASC 805). The Company has allocated the purchase price of the property, through the use of a third party valuation, based upon the fair value of the assets acquired, consisting of land, buildings and intangible assets, including inplace leases and below market leases. Based on the third party valuation performed, the purchase price has been allocated to the fair value of the in-place leases, above market leases and below market leases.  These deferred leasing intangible assets are recorded within Other assets and Other liabilities in the consolidated balance sheets. The value of the in-place lease intangibles will be amortized to amortization expense over the remaining lease terms. The fair value assigned pertaining to the above market in-place leases values are amortized as a reduction to rental revenue, and the below market in-place lease values are amortized as an increase to rental revenue over the remaining non-cancelable terms of the respective leases.

The Company will recognize the amortization related to Transit Business Park intangible assets according to the following schedule (in thousands):

		In-place	Above Market	Below Market
		Leases	Leases	Leases
Initial Values	$	806	48	156
Annual Amortization:
2013	$	121	3	24
2014		369	12	86
2015		78	11	37
2016		64	11	9
2017		62	11	—
2018		35	—	—
2019		34	—	—
2020		34	—	—
2021		9	—	—

KELSO BUSINESS PARK - On June 6, 2014, the Company purchased for approximately $4.8 million, the Kelso property in Baltimore, Maryland which consists of 2 buildings on 10.2 acres totaling 69,680 square feet. The Company has accounted for this acquisition in accordance with the provisions of ASC 805, Business Combinations (ASC 805). The Company has allocated the purchase price of the property, through the use of a third party valuation, based upon the fair value of the assets acquired, consisting of land, buildings and intangible assets, including in-place leases and below market leases. Based on the third party valuation performed, $579,000 and $64,000 of the purchase price has been allocated to the fair value of the in-place leases and below market in-place leases, respectively. These intangible assets are recorded within Other assets and Other liabilities, respectively, in the consolidated balance sheets as of September 30, 2014. The value of the in-place lease intangibles will be amortized to amortization expense over the remaining lease term. The fair value assigned pertaining to the below-market in-place leases will be amortized to rental revenue over the remaining non-cancelable terms of the respective leases.

The Company will recognize the amortization related to Kelso Business Park intangible assets according to the following schedule (in thousands):

		In-place	Below Market
		Leases	Leases
Initial Values	$	579	64
Annual Amortization:
2014		80	8
2015		218	21
2016		133	21
2017		96	12
2018		25	2
2019		18	—
2020		9	—

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Business Segments (Details Narrative)	12 Months Ended
	Sep. 30, 2014 Segments
Segment Reporting [Abstract]
Reportable business segments	3
Real estate operations reportable segments	2

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Income Taxes (Tables)

12 Months Ended

Sep. 30, 2014

Income Tax Disclosure [Abstract]

Provision for income taxes

(in thousands)		2014		2013	2012
Current:
Federal	$	5,747		4,264	2,834
State		1,708		1,136	437
		7,455		5,400	3,271
Deferred		(803	)	4,437	1,538
Total	$	6,652		9,837	4,809

A reconciliation between the amount of tax shown above and the amount computed at the statutory Federal income tax rate follows (in thousands):

		2014	2013	2012
Amount computed at statutory
Federal rate	$	5,737	8,636	4,256
State income taxes (net of Federal
income tax benefit)		886	1,129	562
Other, net		29	72	(9	)
Provision for income taxes	$	6,652	9,837	4,809

Temporary differences

(in thousands)		2014	2013
Deferred tax liabilities:
Property and equipment	$	22,496	22,650
Depletion		477	479
Unrealized rents		1,850	1,803
Prepaid expenses		1,447	1,306
Gross deferred tax liabilities		26,270	26,238
Deferred tax assets:
Insurance liabilities		819	786
Employee benefits and other		3,558	2,758
Gross deferred tax assets		4,377	3,544
Net deferred tax liability	$	21,893	22,694

Unrecognized tax benefits

(in thousands)		2014	2013
Balance at October 1	$	—	—
Reductions due to lapse of statute of limitations		—	—
Balance at September 30	$	—	—

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Fair Value Measurements

12 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

Fair Value Measurements

11. Fair Value Measurements.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. Level 1 means the use of quoted prices in active markets for identical assets or liabilities. Level 2 means the use of values that are derived principally from or corroborated by observable market data. Level 3 means the use of inputs are those that are unobservable and significant to the overall fair value measurement.

As of September 30, 2014 the Company had no assets or liabilities measured at fair value on a recurring or non-recurring basis. At September 30, 2014 and 2013, the carrying amount reported in the consolidated balance sheets for cash and cash equivalents, short-term notes payable and revolving credit approximate their fair value based upon the short-term nature of these items.

The fair values of the Company’s other mortgage notes payable were estimated based on current rates available to the Company for debt of the same remaining maturities. At September 30, 2014, the carrying amount and fair value of such other long-term debt was $63,238,000 and $67,081,000, respectively. At September 30, 2013, the carrying amount and fair value of such other long-term debt was $49,904,000 and $53,252,000, respectively.