Gyrodyne(US:GYRO)2022-11-08 15:40Financial Projections and Distributions - As of September 30, 2022, the estimated cash balance for Gyrodyne is projected to be approximately $22.87 million by December 31, 2024, equating to future distributions of $15.42 per share based on 1,482,680 common shares outstanding[126]. - The estimated distributions to shareholders are based on values as of September 30, 2022, and include some potential value from ongoing entitlement efforts[126]. - Estimated liquidating distributions per share are approximately $15.42 based on net assets in liquidation of $22,869,716 as of September 30, 2022, down from $15.53 per share as of December 31, 2021[183]. - The cash balance at the end of the liquidation period is estimated to be $4.4 million, which will be used to fund efforts to maximize property values and facilitate asset sales[197]. - Total gross cash proceeds from the sale of assets are estimated at approximately $42.5 million, with distributable cash from liquidation estimated at $22.87 million[197]. Property Development and Entitlements - Gyrodyne's strategy includes enhancing the value of its properties in Flowerfield and Cortlandt Manor through entitlement opportunities and lease value enhancement[112]. - The Flowerfield property has received preliminary approval to be subdivided into eight lots, pending certain conditions[120]. - The Company anticipates final approvals for subdivision applications for Flowerfield and Cortlandt Manor in 2023, allowing for the identification of potential purchasers[124]. - The ongoing Article 78 Proceeding could delay the timeline for final approvals and property sales, potentially extending beyond 2024[122]. - The Company is focusing on maximizing pre-construction values for properties by pursuing necessary entitlements while considering attractive offers from potential buyers[130]. - The Company is exploring development projects at Flowerfield that fall within "as of right to build" zoning and may seek additional entitlements from the Town of Smithtown[137]. - The Company is proposing a two-phase medical office campus with limited retail in the MOD, which has not yet been formally adopted[134]. - An alternate mixed-use plan for the Cortlandt property includes 83,500 square feet of medical office space and 160 multi-family residential units[135]. - The Company anticipates the final Environmental Impact Statement (EIS) for the Cortlandt property will be accepted in Q4 2022, with MOD designation expected in Q1 2023[136]. - The Company is pursuing entitlements and density approvals, with the timeline for completion potentially extending due to various external factors[167]. Financial Performance and Revenue - The company reported net operating income of $914,279 for the nine months ended September 30, 2022, with total rents and reimbursements of $2,251,369 and operating costs of $1,337,090[200]. - During the nine months ended September 30, 2022, the Company executed two new leases and 15 renewals, generating annual revenue of approximately $61,600 and $410,400 respectively[160]. - The Company incurred commission fees of approximately $27,300 related to new and extended leases during the same period[160]. - Approximately 41% of the Company's 2022 projected annual rental revenues are from tenants not affiliated with a major hospital[148]. - The Company deferred approximately $118,000 of rental revenue due to tenants closed under the "New York State on PAUSE" Executive Order, with all deferred rent expected to be collected[156]. Costs and Expenses - The Company incurred approximately $282,000 in land entitlement costs during the nine months ended September 30, 2022, with an estimated additional $1.09 million expected through December 31, 2024[129]. - The entitlement costs for the Cortlandt property for the nine months ended September 30, 2022, were approximately $76,000[133]. - The entitlement costs for the Flowerfield property for the nine months ended September 30, 2022, were approximately $206,000[141]. - The company estimates that general and administrative expenses, excluding final liquidation costs, will total approximately $4.99 million[192]. - The Company has deferred approximately $1,114,000 of land development fees and other professional fees until the first post-subdivision property lot is sold[158]. Strategic Intent and Future Plans - Gyrodyne intends to dissolve after the disposition of all real property assets and the settlement of debts, with liquidating distributions to shareholders thereafter[113]. - The Company has a dual strategy to manage risk while maximizing returns for shareholders through the enhancement of property values[117]. - The Company intends to complete the liquidation process by December 31, 2024, although this timeline is subject to various external factors[174]. - The pandemic has negatively impacted demand for office and hotel developments, influencing the Company's subdivision plan at Flowerfield[142]. - The healthcare industry, which comprises the Company's tenants, is facing increased regulation that could materially impact their operations and the marketability of the properties[144]. Risk Management - The Company has not experienced any significant credit risk on cash as of September 30, 2022, and maintains bank account balances exceeding FDIC insurance limits[201].