Real Estate Assets

6 Months Ended

May 31, 2018

3. Real Estate Assets

Real estate assets consist of:


	Estimated
	Useful Lives	May 31, 2018		Nov. 30, 2017
Land		$	20,679	$	20,403
Land improvements	10 to 30 years		31,635		30,833
Buildings and improvements	10 to 40 years		187,520		187,116
Tenant improvements	Shorter of useful life or terms of related lease		27,814		27,924
Machinery and equipment	3 to 20 years		10,958		10,958
Construction in progress			12,387		486
Development costs			14,226		14,132
			305,219		291,852
Accumulated depreciation			(100,105)		(95,112)
		$	205,114	$	196,740

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, 2018		May 31, 2017		May 31, 2018		May 31, 2017
Depreciation expense	$	2,457	$	2,112	$	4,859	$	4,207

Capitalized interest	$	94	$	—	$	132	$	—

On April 26, 2018, Griffin closed on the sale of approximately 49 acres (the “Southwick Land Sale”) of undeveloped land in Southwick, Massachusetts. Griffin received cash proceeds of $850 before transaction costs and recorded a pretax gain of $794 on the Southwick Land Sale. The net cash proceeds, after transaction costs, of $847 from the Southwick Land Sale were deposited into escrow for a potential acquisition of a replacement property in a like-kind exchange (“1031 Like-Kind Exchange”) under Section 1031 of the Internal Revenue Code of 1986, as amended, for income tax purposes.

On April 28, 2017, Griffin closed on the sale of approximately 67 acres (the “2017 Phoenix Crossing Land Sale”) of undeveloped land in Phoenix Crossing, the approximately 268 acre business park master planned by Griffin that straddles the town line between Windsor and Bloomfield, Connecticut. Griffin received cash proceeds of $10,250 before transaction costs and recorded a pretax gain of $7,975 on the 2017 Phoenix Crossing Land Sale. The net cash proceeds, after transaction costs, of $9,711 from the 2017 Phoenix Crossing Land Sale were deposited into escrow and subsequently used for the acquisition of a replacement property in a 1031 Like-Kind Exchange.

Real estate assets held for sale consist of:


	May 31, 2018		Nov. 30, 2017
Land	$	210	$	504
Land improvements		—		354
Development costs		1,007		1,074
	$	1,217	$	1,932

Real estate assets held for sale were reduced in the 2018 six month period by $105 related to property sales that closed and by $610 related to a property sale that is no longer expected to take place.