Wellsford Real Properties, Inc. (AMEX:WRP) announced today that
it's net assets in liquidation at December 31, 2005 aggregated
$56,569,414 or $8.74 per share based upon 6,471,179 shares
outstanding at December 31, 2005. WRP had announced in November
2005 that its stockholders approved the Plan of Liquidation (the
"Plan") at WRP's annual meeting held on November 17, 2005. After
the approval of the Plan by the stockholders, WRP completed the
sale of its largest asset, the three residential rental phases of
its Palomino Park project for $176,000,000. On December 14, 2005,
the Company made an initial liquidating distribution of $14.00 per
share, aggregating approximately $90,597,000, to its stockholders.
For all periods preceding stockholder approval of the Plan on
November 17, 2005, WRP's financial statements are presented on the
going concern basis of accounting. As required by generally
accepted accounting principles, WRP adopted the liquidation basis
of accounting as of the close of business on November 17, 2005.
Under the liquidation basis of accounting, assets are stated at
their estimated net realizable value and liabilities are stated at
their estimated settlement amounts, which estimates will be
periodically reviewed and adjusted as appropriate. At December 31,
2005, WRP had total assets of $126,670,151 which was comprised
primarily of real estate assets under development of $44,233,031,
investments in joint ventures of $20,453,074, cash of $41,027,086
and restricted cash and investments of $18,953,325. Total
liabilities and minority interests of $70,100,737 at December 31,
2005 was comprised of the reserve for estimated costs during the
period of liquidation of $24,057,079, mortgage notes and
construction loans payable of $19,250,344, the deferred
compensation liability of $14,720,730 and other accruals and
liabilities of $12,072,584. During the period November 18, 2005 to
December 31, 2005, WRP reported a reduction of $90,319,588 in net
assets in liquidation, substantially the result of the
aforementioned distribution to stockholders. Prior to the approval
of the Plan and the adoption of the liquidation basis of
accounting, WRP reported revenues of $2,140,491 and a net loss of
($936,621) or ($0.14) per basic and diluted share during the period
October 1, 2005 through November 17, 2005. WRP reported revenues of
$14,710,475 and net income of $3,018,292 or $0.47 per basic and
diluted share during the period January 1, 2005 to November 17,
2005. WRP reported fourth quarter 2004 revenues of $4,689,000 and a
net loss of $(10,193,063), or $(1.58) per basic and diluted share.
For the year ended December 31, 2004, WRP reported revenues of
$27,649,326 and a net loss of $(32,703,450), or $(5.06) per basic
and diluted share. Remaining Activities, Assets and Investments At
December 31, 2005, WRP's remaining activities, assets and
investments were comprised primarily of the following: -- The 259
unit Gold Peak condominium development in Highlands Ranch, Colorado
is the remaining phase from our Palomino Park development. WRP is
currently constructing Gold Peak and had 84 units under contract at
December 31, 2005. Gold Peak unit sales commenced in January 2006.
-- The Orchards, a single family home development in East Lyme,
Connecticut, upon which WRP commenced building 101 single family
homes on 139 acres. An additional 60 homes could be built on a
contiguous parcel of land. The model home was completed during the
fourth quarter of 2005. The completion of the initial homes and
closings of initial sales are expected to occur in 2006. -- A 75%
interest in a joint venture that owns two land parcels aggregating
approximately 300 acres in Claverack, New York. One land parcel is
subdivided into seven single family home lots upon which WRP
intends to build and sell custom designed homes. The remaining 235
acres, known as The Stewardship, are currently subdivided into six
single family home lots with the intent to increase the number of
developable residential lots to 49 lots, improve the land and
construct and sell single family homes. -- Interests in Reis, Inc.,
a real estate information and database company. -- A 10% interest
in Clairborne Fordham, a company which currently owns and is
selling the remaining two unsold residential units of a 50-story,
277 unit, luxury condominium apartment project in Chicago,
Illinois. -- A project in Beekman, New York where WRP owned
approximately 10 acres of land and has a contract, secured by a
first mortgage lien on the property, to acquire a contiguous 14
acre parcel. This investment was sold in January 2006. The Plan The
Plan contemplates the orderly sale of each of WRP's remaining
assets, which are either owned directly or through WRP's joint
ventures, the collection of all outstanding loans from third
parties, the orderly disposition or completion of construction of
development properties, the discharge of all outstanding
liabilities to third parties and, after the establishment of
appropriate reserves, the distribution of all remaining cash to
stockholders. WRP currently contemplates that approximately 36
months after the approval of the Plan any remaining assets and
liabilities would be transferred into a liquidating trust. The
liquidating trust would continue in existence until all liabilities
have been settled, all remaining assets have been sold and proceeds
distributed and the appropriate statutory periods have lapsed. As
noted above, WRP's net assets in liquidation aggregated
$56,569,414, or $8.74 per share. This amount presents development
projects at estimated net realizable value after giving effect to
the present value discounting of estimated net proceeds therefrom.
All other assets are presented at estimated net realizable value on
an undiscounted basis. The amount also includes a reserve for
future estimated general and administrative expenses and other
costs during the liquidation. Estimated net realizable value
reflects economic changes and various other changed circumstances
over recent months. There can be no assurance that these estimated
values will be realized, nor if the reserve for future estimated
general and administrative expenses is adequate. Such amount should
not be taken as an indication of the timing or amount of future
distributions to be made by WRP. The timing and amount of interim
liquidating distributions (if any) and final liquidating
distributions will depend on the timing and amount of proceeds the
Company will receive upon the sale of the remaining assets and the
extent to which reserves for current or future liabilities are
required. Accordingly, there can be no assurance that there will be
any liquidating distributions prior to a final liquidating
distribution. WRP is a company in liquidation. WRP was formed to
operate as a real estate merchant banking firm to acquire, develop,
finance and operate real properties and invest in private and
public real estate companies. At December 31, 2005, the Company's
remaining primary operating activities are the development,
construction and sale of three residential projects. This press
release, together with other statements and information publicly
disseminated by WRP, contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of WRP or industry results to
be materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Such factors include, among others, the following,
which are discussed in greater detail in the "Risk Factors" section
of WRP's Form 10-K filed with the Securities and Exchange
Commission ("SEC") on March 16, 2006 which is incorporated herein
by reference: general and local economic and business conditions;
future valuation adjustments as a result of possible declines in
the expected values and cash flows of residential development
projects and investments or changes in the intent with regards to
such projects and investments; competition; risks of real estate
development, construction and renovation including construction
delays and cost overruns; inability to comply with zoning and other
laws and obtain governmental approvals; the risk of inflation in
development costs (including construction materials); the
availability of insurance coverages; the inability to obtain or
replace construction financing for development projects; adverse
consequences of debt financing including, without limitation, the
necessity of future financings to repay maturing debt obligations;
inability to meet financial and valuation covenants contained in
loan agreements; inability to repay financings; exposure to
variable rate based financings; risk of foreclosure on collateral;
risks of leverage; risks associated with equity investments in and
with third parties; risks associated with our reliance on joint
venture partners including, but not limited to, the inability to
obtain consent from partners for certain business decisions, the
potential risk that our partners may become bankrupt, have economic
or other business interests and objectives which may be
inconsistent with those of WRP and our partners being in a position
to take action contrary to our interests; inability and/or
unwillingness of partners to provide their share of any future
capital requirements; availability and cost of financing; interest
rate risks; demand by prospective buyers of condominiums and single
family homes; inability to realize gains from sales of condominiums
and single family homes; lower than anticipated sales prices;
inability to close on sales of properties; the risks of seasonality
and increasing interest rates on WRP's ability to sell condominium
units and single family homes; increases in energy costs,
construction materials and interest rates could adversely impact
our home building business as homes become more expensive to build
and profit margins could deteriorate; inability to raise sale
prices to maintain profit margins; the negative impact from a
continuing rise in energy costs and interest rates on our marketing
efforts and the ability for buyers to afford our homes at any price
level, which could result in the inability to meet targeted sales
prices or cause sales price reductions; environmental risks;
inability of Reis to be sold at all, for the amount of proceeds
used by WRP in valuing Reis, or on terms that are favorable to WRP;
the Board could abandon the Plan; failure to achieve proceeds from
the sales of assets to meet the estimated ranges of total
distributions to stockholders under the Plan; the uncertainty as to
the timing of sales of assets and the impact on the timing of
distributions to stockholders; illiquidity of real estate assets
and joint venture investments; increases in expenses which would
negatively impact the amount of distributions pursuant to the Plan;
unknown claims and liabilities which would negatively impact the
amount of distributions pursuant to the Plan; the sale of
undeveloped land, rather than the construction and sale, in the
normal course of business, of single family homes or condominium
units which would negatively impact the amount of distributions
pursuant to the Plan; the inability to utilize all of WRP's Federal
net operating loss carryforwards; and other risks listed from time
to time in WRP's reports filed with the SEC. Therefore, actual
results could differ materially from those projected in such
statements.
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