3. Real Estate Assets

Real estate assets, net consist of:


	Estimated
	Useful Lives	May 31, 2016		Nov. 30, 2015

Land		$	17,989	$	18,157
Land improvements	10 to 30 years		22,605		22,440
Buildings and improvements	10 to 40 years		154,760		149,111
Tenant improvements	Shorter of useful life or terms of related lease		21,428		19,611
Machinery and equipment	3 to 20 years		11,022		11,810
Construction in progress			13,498		10,240
Development costs			15,870		15,870
			257,172		247,239
Accumulated depreciation			(83,699)		(80,784)
		$	173,473	$	166,455

Total depreciation expense and capitalized interest related to real estate assets were as follows:


	For the Three Months Ended				For the Six Months Ended
	May 31, 2016		May 31, 2015		May 31, 2016		May 31, 2015

Depreciation expense	$	1,898	$	1,596	$	3,782	$	3,146

Capitalized interest	$	133	$	204	$	217	$	367

In the fiscal 2013 fourth quarter, Griffin completed the sale of approximately 90 acres of undeveloped land for $8,968 in cash, before transaction costs (the “Windsor Land Sale”). The land sold is located in Windsor, Connecticut and is part of an approximately 253 acre parcel of undeveloped land that straddles the town line between Windsor and Bloomfield, Connecticut. Under the terms of the Windsor Land Sale, Griffin and the buyer were each required to construct roadways connecting the land parcel sold with existing town roads. The roads constructed by the buyer and the road being constructed by Griffin will become new town roads, thereby providing public access to the remaining acreage in Griffin’s land parcel. As a result of Griffin's continuing involvement with the land sold, the Windsor Land Sale is being accounted for under the percentage of completion method. Accordingly, the revenue and pretax gain on the sale are being recognized on a pro rata basis in a ratio equal to the percentage of the total costs incurred to the total anticipated costs of sale, including costs of the required roadwork. Costs included in determining the percentage of completion include the cost of the land sold, allocated master planning costs and the cost of road construction.

In the 2016 second quarter, Griffin increased its estimate of the total costs to complete the required road improvements attributed to the Windsor Land Sale by $79, based upon changes received from the state of Connecticut’s Department of Transportation in the 2016 second quarter that increased the scope of roadwork required to be completed by Griffin. Accordingly, the increase in total cost of the roadwork resulted in the estimated percentage of completion being lowered to approximately 89% as of May 31, 2016 from the estimate of approximately 92% as of November 30, 2015, resulting in the adjustment of $278 to reduce the cumulative amount of revenue from the Windsor Land Sale recorded through May 31, 2016. As no work on the Windsor Land Sale took place during the 2016 six month period and there were no other property sales, revenue from property sales in the 2016 second quarter and the 2016 six month period reflects solely the adjustment to reduce revenue from the Windsor Land Sale. The adjustment to revenue from property sales in the 2016 second quarter did not affect the total proceeds from the Windsor Land Sale, which were received in fiscal 2013. The effect of the estimated additional roadwork cost is expected to reduce the estimated total pretax gain on the Windsor Land Sale from approximately $6,765 to approximately $6,686 after all costs are incurred. From the time the Windsor Land Sale closed in fiscal 2013 through May 31, 2016, Griffin’s consolidated statements of operations reflected total revenue, including the adjustment to revenue discussed above, of $7,978 and a total pretax gain of $5,950 from the Windsor Land Sale. Griffin's consolidated statements of operations for the 2015 second quarter and 2015 six month period included revenue of $245 and $1,071, respectively, and a pretax gain of $127 and $749, respectively, from the Windsor Land Sale. The balance of the revenue and pretax gain on sale will be recognized when the remaining costs are incurred, which is expected to be in the second half of fiscal 2016. Deferred revenue on Griffin's consolidated balance sheet as of May 31, 2016 includes $990 related to the Windsor Land Sale that will be recognized as the remaining costs are incurred. While management has used its best estimates, based on industry knowledge and experience, in projecting the total costs of the required roadways being constructed, increases or decreases in future costs as compared with current estimated amounts would reduce or increase the gain recognized in future periods.

Real estate assets held for sale consist of:


	May 31, 2016		Nov. 30, 2015

Land	$	246	$	78
Development costs		1,341		1,340
	$	1,587	$	1,418