Excuse me, ladies and gentlemen. We now have our speakers in conference. [Operator Instructions] At that time, further instructions will be given as the procedure to follow if you would like to ask a question. It is now my pleasure to turn the conference over to Mr. John Baker. Sir, please begin.

Good afternoon. I'm John Baker, III, Chief Financial Officer and Treasurer of FRP Holdings. And with me today are David deVilliers, Jr., our President; John Milton, our Executive Vice President and General Counsel; John Klopfenstein, our Chief Accounting Officer; and David deVilliers, III, our Executive Vice President. Before we begin, let me remind you that any statements on this call, which relate to the future are, by their nature, subject to risks and uncertainties that could cause actual results and events to differ materially from those indicated in such forward-looking statements. These risks and uncertainties are listed in our SEC filings. We have no obligation to revise or update any forward-looking statements except imposed by law as a result of future events or new information. Now let me turn to financial highlights. Net income for the third quarter was $352,000 or $0.04 per share versus $5,455,000 or $0.57 per share in the same period last year. Some of this decrease is a result of lower interest income due to bond maturities and the fact that The Maren's permanent refinancing paid off our preferred loan to the JV, so we are no longer receiving a return on that loan. We also had an increase in interest expense relative to last year as a result of stabilization of The Maren prior to consolidating The Maren onto our books, our share of the merits interest expense was included in the loss from joint venture line rather than interest expense. The Maren's increased -- interest expense is mitigated to some extent by the lower interest rate on the refinanced Dock 79 loan. However, the lion's share of this increase is attributable to a decrease in the gain on sale of real estate. We sold 2 properties this quarter last year for a gain of…

Thank you, John. And good afternoon to those on the call today. It was mentioned during our recent Investors Day presentation in Washington, D.C. that FRP has been quietly engaged in a 4-pronged investment strategy of investing cash reserves with a goal towards increasing profitability and shareholder value. To supplement the information detailed in the press release and the 10-Q, I'd like to take a slightly different approach today by providing you with a window into the 4 prongs of focus that both helped build the FRP of yesteryear and are central to our operations and balance sheet today. That being, one, our in-house industrial and commercial development platform; two, mining and royalties; three, third-party joint ventures; and four, lending ventures. Relative to our in-house industrial commercial activities, Cranberry Run Business Park, our 268,000 square foot value-add purchase and rehabilitation project was 96.6% leased at quarter's end, versus 78.6% for the same period last year. As of today, we're happy to report the park is 100% leased with full occupancy expected in the first quarter of 2022. Our multi-tenanted suburban office building [indiscernible] is FRP's Maryland offices was 95% leased and occupied quarter's act. Our vacant lot in Jacksonville remains fully leased to Vulcan Materials through Q1 2026. NOI for these 3 assets that make up the Asset Management business segment,was $468,000 for the quarter versus $506,000 in the same period last year, reduction in NOI comes as a result of the sale of our Hollander Spec building in July 2020. Our 2 new speculative Shell warehouse buildings totaling 145,700 square feet at the Hollander Business Park near the Port of Baltimore, our state-of-the-art Class A concrete tilt wall buildings with 28- and 32-foot clear ceiling heights built to Baltimore City green building standards. 64% of the first of Building…

Thank you, David. Now at this point, we're happy to open up the call for any questions that any of you might have.

[Operator Instructions]

It's Curtis Jensen. Just a few questions. First on mining royalties. The Vulcan lease at Fort Myers, it looks like in your presentation that expired and April of this year. Do you know if that was renewed? I know there was like a 15-year option for that merchant.

They exercised the renewal option.

No surprise. And just given sort of the growing demand regionally, are there any prospects for some of the other properties that are leased but not currently being mined to start mining?

Are you asking if the...

Yes. I think you've got 3 properties with a lease to Vulcan and 1 to CEMEX and they're not currently being mined, but there's a lease on them and you're getting royalties and I just didn't know if there were some prospects for those properties to -- for the tenant to come in and start mining.

The most -- kind of imminent one of those to start in the next year, so the CEMEX. They've -- it took a long time for that site to get permitted. And then as part of their permitting improve County Road and connected from 1 part of the county to another and then build a plant. Part of the reason that the aggregates industry is so attractive in terms of the ability to raise prices and keep them up is that it's hard to get permitted and CEMEX and what they've gone through. Down Lake Louisa has proved positive of that. So long story short, they will get around to it. Some of the other sites like Lake Sand, Vulcan lease is another part of the land adjacent to ours, and our reserves were [indiscernible] and you need a special type of dragline to get into those reserves, which requires getting it down there and is capital intensive. And so the we're basically mining the rest of the reserves before they turn around and get into ours. So that one is just going to be the minimum for a while. Forest Park, up in Georgia, has a ton of reserves underneath the plant. They also have a lot of reserves but they just haven't gotten to. Obviously, they're not going to move the plant until they absolutely have to. And that's just where our portion of those reserves are. So again, long walk for a short drink of water. Lake Louisa is going to be the one that gets mined first. Lake Sand will eventually get mine d. And Forest Park, absolutely, will get mined. I'm trying to think of the other 2.

Maren's done.

Maren's done. And then I don't know about Air Grove, but they still have reserves or if they're completely done. But that's it.

Okay. And is Vulcan at [indiscernible]? I know they sounded like they shifted some of some things. And are they going to return to kind of debt operating back to where they were?

Yes, it's the -- the property line kind of goes right through the middle of the pit. So that's just part of the mining there. You're sort of bouncing around from site to site. But I don't think there's a renewal on that lease. And there's a meaningful amount of reserves left there. And in the works at [indiscernible], we've got a long way to go in a short time, we get there. They're going to have to mine that they have every incentive to mine it. So they'll be back on that land probably pretty soon.

Okay. And then just shifting over to -- I don't want to dominate the questions here, but a couple more at Dock and Maren, I guess the NOI was -- for the quarter was $3.1 million. If you look out to kind of 2022 and you assume your retail is at 100%, you get a little bit of a rent bump starting maybe Q2 or something. Your financing stable, obviously. I mean have you guys started to think about what kind of budget NOI you would have for 2022 there?

Yes, well -- we obviously have some , but that's -- we don't want to speculate on it and then be wrong, which is not helpful to you, but it's just been kind of how we did that.

And then I'll just shift over...

Just to add something to John's comment, Curtis. The good thing is that restrictions will be lifted by the government. We weren't allowed to do anything with rental rate increases or were we allowed to evict somebody to notice money. And that's going to be up here shortly, but we fall about 60 days behind just by virtue of the lease-up program. So we're hopeful. But you don't know market is going to dictate those actions and -- but we're kind of hopeful that we'll -- that we'll do -- certainly do as well and if not better than we did this year.

Okay. And then you mentioned a new lending venture.

Yes.

I guess was that funded after the end of the third quarter? Or is it starting to be funded or?

Yes. We -- it's a long-term project. These things can go 4 to 5 years from the beginning all the way up through. But it's a $31.1 million commitment. And it's going to -- we're doing it the same way we did with Hyde Park, which we sold and got all the -- then made a pretty nice profit in Amber Ridge, but this is the newest one. And we have a deposit in for the property, and we're actually in parallel going through some entitlement work with the necessary government agencies. We don't have to buy the property until we get most of the entitlements already done.

All right. And last question, I'll turn it over is, if you think about your build-out at Hollander, you add Aberdeen, Hartford and now [indiscernible] County, over the next 2 to 3 years? I mean, are we -- is that -- because there was a comment in the press release about using up all your cash, I mean, is that going to -- do you think that could absorb another $50 million to $100 million over the next 3 years or something or?

Obviously, when we start. But as I said in my narrative over the -- we have a warehouse platform and pipeline. It could be as high as 2.4 million square feet. And then we really need to determine the appropriate time and market conditions, and that's sort of thing to see when they would develop. But we'd like to think if the market stays where it is, that we would be under full development, and that's where we would be heading.

Yes. Curt, obviously, the expanding our land bank and developing more warehouses will be part of how we use our cash. And Phase III, Phase IV, the site where Vulcan is now and the Anacostia River, those are going to be very big uses of cash for us as well. And then there's the potential for Bryant Street Phase 2, and potentially additional development in Greenville. So we -- it's going to be spread across all of our different platforms.

But it sounds like there's pretty productive use for your cash over the next, call it, 3 to 4 years?

Yes.

Here comes our next question.

It's Stephen Farrell here. Well, I just have a few quick questions. In regards to the 2 industrial buildings at [indiscernible] Business Park being completed this quarter, are constructing with the last building? Or are you seeing pressure there?

Well, they're almost done. So a lot of the purchasing was done, we were able to solidify a lot of the more expensive materials early on, but there's -- it's a little bit more expensive than the last one, yes. Rents are a little bit higher, too.

Okay. And if you look at the industrial pipeline, you have the -- you mentioned earlier the 930,000 square feet in entitlement phase and another $900,000 under contract. If we go through the development of all that, is it correct to assume that you'd earmark about $140 million to $160 million to develop those?

Well, it depends on what the construction pricing is at the time. A lot of factors determine what -- how we move forward. But I would say, yes.

Okay. And you just mentioned earlier, you also have the potential for Anastasia Phase III, Bryant Street Phase II, do you expect over the next 3 or so years to be able to fund all these projects from cash? Or would you consider financing on some of the industrial projects.

Well, we have -- historically, we have built the warehouse facilities out of cash, and we, because of the joint venture nature of these mixed-use programs, have gotten construction loans and then when properly stabilized, we moved to permanent financing. And that's been the process that we've gone through. And that's not to say that we wouldn't change, but it's probably the direction we would go going forward.

Yes, Stephen, and part of that is a result of we do these warehouse projects entirely in how on our own. And so -- There's no partnership, no one else's capital constraints to consider, and we've got the cash to do it. And on the multifamily stuff, we're usually partners with people on these deals. And that's sort of the name of the game with the multifamily is you put debt on them. So we're sort of going along and get along in that regard.

Okay. And last question. And you sort of alluded to it earlier. We don't know exactly when the rent freezes will be up. But if they do expire at the end of the year. Do you expect to be sort of aggressive in raising rents? Or are you going to focus on keeping occupancy where it is in a more gradual rent increase.

We look at the -- our property management company at those 2 projects with most of them, we have a software project program that literally looks at though every apartment every day. And so we obviously look to expand the rent the best we can. And there's kind of a -- I guess there's kind of a equilibrium there. You don't want to have a renewal rate that's higher than, say, 55% or 60% because if you do, you're wondering if you shouldn't be raising the reps, but we also want to keep heads and beds too. So it's a balance. But we feel pretty good about where we are today. And hopefully, we can do a little bit better in the upcoming months.

Speakers, there are no further questions in queue.

All right. Well, if that's it. We really appreciate you all continued interest in the company, and we're going to get back to work and try to make all some money. Thank you, again.

Thank you, ladies and gentlemen. This concludes today's teleconference. Thank you for your participation. You may now disconnect.