10-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________

FORM 10-K

_________________

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 2016.

or

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-36769

_____________________

FRP HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

_____________________

FLORIDA	47-2449198
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
200 W. Forsyth St., 7th Floor, Jacksonville, Florida	32202
(Address of principal executive offices)	(Zip Code)

(904) 396-5733

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock $.10 par value	NASDAQ

Securities registered pursuant to Section 12(g) of the Act: None

_________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  [_]    No  [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  [_]    No  [X]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  [X]    No  [_]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  [X]    No  [_]

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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [_]	Accelerated  filer [X]
Non-accelerated filer [_]	Smaller reporting company [_]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes  [_]    No  [X]

The number of shares of the registrant’s stock outstanding as of December 12, 2016 was 9,881,415. The aggregate market value of the shares of Common Stock held by non-affiliates of the registrant as of March 31, 2016, the last day of business of our most recently completed second fiscal quarter, was $269,324,902. Solely for purposes of this calculation, the registrant has assumed that all directors, officers and ten percent (10%) shareholders of the Company are affiliates of the registrant.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the FRP Holdings, Inc. 2016 Annual Report to Shareholders are incorporated by reference in Parts I and II.

Portions of the FRP Holdings, Inc. Proxy Statement which will be filed with the Securities and Exchange Commission not later than December 31, 2016 are incorporated by reference in Part III.

Explanatory Note

As previously announced in a Form 8-K filed on February 3, 2015, FRP Holdings, Inc. (“FRP” or the “Company”) completed a spin-off (“Spin-off”) of its transportation business on January 30, 2015. The Spin-off was effected through a corporate reorganization and subsequent distribution by the Company of all of the common stock of Patriot Transportation Holding, Inc. (“Patriot”), a subsidiary of the Company formed for the purpose of becoming the new parent company to the transportation business, to the shareholders of FRP. Patriot is now an independent publicly-traded company, and FRP is the successor issuer to the company formerly known as Patriot Transportation Holding, Inc. (NASDAQ: PATR).

Preliminary Note Regarding Forward-Looking Statements.

Certain matters discussed in this report contain forward-looking statements, including without limitation relating to the Company's plans, strategies, objectives, expectations, intentions, capital expenditures, future liquidity, and plans and timetables for completion of pending development projects. The words or phrases “anticipate,” “estimate,” ”believe,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target” and similar expressions identify forward-looking statements. The following factors and others discussed in the Company’s periodic reports and filings with the Securities and Exchange Commission are among the principal factors that could cause actual results to differ materially from the forward-looking statements: uncertainties as to whether the Company can complete, and the timetable for completion of pending or proposed development projects; levels of construction activity in the markets served by our mining properties; availability and terms of financing; competition; interest rates, inflation and general economic conditions; demand for flexible warehouse/office facilities in the Baltimore-Washington-Northern Virginia area; and ability to obtain zoning and entitlements necessary for property development. However, this list is not a complete statement of all potential risks or uncertainties.

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These forward-looking statements are made as of the date hereof based on management’s current expectations, and the Company does not undertake an obligation to update such statements, whether as a result of new information, future events or otherwise. Additional information regarding these and other risk factors may be found in the Company’s other filings made from time to time with the Securities and Exchange Commission.

PART I

Item 1. BUSINESS.

On January 30, 2015, FRP Holdings, Inc. (“FRP” or the “Company”) completed the tax-free Spin-off (“Spin-off”) of its transportation business into a new, separately traded public company, Patriot Transportation Holding, Inc. (Nasdaq GM: PATI) (“Patriot”). In the Spin-off, FRP distributed all of the outstanding stock of Patriot to FRP's shareholders as of the record date of January 9, 2015. FRP’s shareholders received one share of Patriot for every three shares of FRP owned on the record date. Patriot now is an independent, publicly traded company, and FRP retains no ownership in Patriot. The Company retained the real estate business, which is now the sole business of the Company.

FRP Holdings, Inc. was incorporated on April 22, 2014 in connection with a corporate reorganization that preceded the Spin-off. The Company’s successor issuer was formed on July 20, 1998. The business of the Company is conducted through our wholly-owned subsidiaries FRP Maryland, Inc., a Maryland corporation, FRP Development Corp., a Maryland corporation and Florida Rock Properties, Inc., a Florida corporation, and the various subsidiaries of each.

Our Business. FRP Holdings, Inc. (the “Company”) is a holding company engaged in various real estate businesses. The segments of the Company include: (i) leasing and management of warehouse and office buildings owned by the Company (the “Asset Management Segment”), (ii) leasing and management of mining royalty land owned by the Company (the “Mining Royalty Lands Segment”) and (iii) real property acquisition, entitlement, development and construction primarily for warehouse and office buildings (the “Land Development and Construction Segment”).

The Asset Management Segment owns, leases and manages warehouse and office buildings located predominately in the Baltimore, northern Virginia, and Washington, DC market areas. Price, location, rental space availability, flexibility of design and property management services are the major factors that affect competition in the flexible warehouse and office rental market. The Company experiences considerable competition in all of its markets. Tenants of our flexible warehouse/office properties are not concentrated in any one particular industry.

Our Mining Royalty Lands Segment owns several properties comprising approximately 15,000 acres currently under lease for mining rents or royalties (not including the 4,280 acres owned in our Brooksville joint venture with Vulcan Materials).  Other than one location in Virginia, all of these properties are located in Florida and Georgia. 

Our Land Development and Construction Segment owns and continuously monitors the “highest and best use” of parcels of land that are in various stages of development. The overall strategy for this segment is to convert all of our non-income producing property into income-producing property through (i) an orderly process of constructing new warehouse and office buildings to be operated by the Company or (ii) a sale to, or joint venture with, third parties.

Competition. The Asset Management Segment owns, leases and manages warehouse and office buildings located predominately in the Baltimore, northern Virginia, Washington, DC market areas. As a developer of flexible warehouse and office space, we compete with numerous developers, owners and operators of real estate, many of whom own properties similar to ours in the same submarkets in which our properties are located. Price, location, rental space availability, flexibility of design and property management services are the major factors that affect competition in the flexible warehouse and office rental market.

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Customers. Primarily due to our preferred mid-sized (75,000-150,000 square feet) warehouse buildings, the Asset Management Segment mainly caters to local and regional tenants (versus larger national tenants). We do not have any material dependence on a particular industry for our tenants in this segment. With the completion and occupancy of the 3rd build to suit for VADATA at Patriot Business Park in the first quarter of fiscal 2015 this particular tenant accounted for 11% of the Company’s consolidated revenues during fiscal 2016. In the Mining Royalty Lands segment, we have a total of four tenants currently leasing our mining locations and one particular tenant (Vulcan Materials Company) accounted for 15.6% of the Company’s consolidated revenues in fiscal 2016. An event affecting either VADATA’s or Vulcan’s ability to perform under its lease agreements could materially impact the Company’s results.

Sales and Marketing. We use national brokerage firms to assist us in marketing our vacant warehouse rental properties. Our hands on in-house management team focuses on tenant satisfaction during the life of the lease which we have found to be very beneficial with respect to our tenant renewal success rate over the years.

Financial Information. Financial information is discussed by industry segment in Note 11 to the consolidated financial statements included in the accompanying 2016 Annual Report to Shareholders, which is incorporated herein by reference.

Environmental Matters. The Company incurs costs from time to time to investigate and remediate environmental contamination on its real estate. The Company's mining leases contain provisions under which the lessee is responsible for environmental liabilities and reclamation of mining sites at least to the extent required by law.

Seasonality. The Company’s business is subject to limited seasonality factors due to the cyclical nature of our mining customers’ businesses. Revenues generally decline slightly during winter months.

Employees. The Company employed 18 people in its real estate group at September 30, 2016.

Company Website. The Company’s website may be accessed at www.frpholdings.com. All of our filings with the Securities and Exchange Commission are accessible through our website promptly after filing. This includes annual reports on Form 10-K, proxy statements, quarterly reports on Form 10-Q, current reports filed or furnished on Form 8-K and all related amendments.

Item 1A. RISK FACTORS.

Our future results may be affected by a number of factors over which we have little or no control. The following issues, uncertainties, and risks, among others, should be considered in evaluating our business and outlook. Also, note that additional risks not currently identified or known to us could also negatively impact our business or financial results.

Risks Relating to the Spin-off

Since the Spin-off of Patriot , FRP has shared three executives with Patriot so those executives will not devote their full time and attention to the Company.

Under the terms of the Transition Services Agreement between FRP and Patriot, Patriot provides the services of three of its executive officers to FRP. Thompson S. Baker II, Chief Executive Officer, John D. Milton, Jr., Chief Financial Officer and John D. Klopfenstein, Controller and Chief Accounting Officer, serve in the same capacities with FRP under the Transition Services Agreement. These executives spend approximately 50% of their time working for FRP pursuant to the terms of the Transition Services Agreement and both companies share in 50% of the costs (including overhead). FRP could be adversely impacted by lack of the full-time focus of these executives during the term of the Transition Services Agreement. In addition, these executives may face conflicts of interest, or the appearance thereof, if there is a dispute under the agreements between Patriot and FRP or a future business transaction.

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There may be potential conflicts of interest between FRP and Patriot due to the Spin-off.

FRP has common management with Patriot, which could cause a conflict of interest for the shared executives or the Company. Currently, three of our executive officers serve as executive officers of both FRP and Patriot. FRP’s Chief Executive Officer, Thompson S. Baker II, also serves as a director and the Chief Executive Officer and President of Patriot. FRP's executive officers and board members will have fiduciary duties to our shareholders. Likewise, any such persons who serve in similar capacities at Patriot will have fiduciary duties to Patriot’s shareholders. Therefore, such persons may have conflicts of interest or the appearance of conflicts of interest with respect to matters involving or affecting both companies. For example, there will be a potential conflict of interest if FRP and Patriot consider acquisitions or other business opportunities that may be suitable for both companies. Moreover, most of Patriot's directors and officers will continue to own FRP common stock and options to purchase FRP common stock, which they acquired prior to the Spin-off or will acquire in the future in connection with their employment with FRP. These ownership interests could create, or appear to create, conflicts of interest when these individuals are faced with decisions that could have different implications for FRP and Patriot. From time to time, FRP may enter into transactions with Patriot or its subsidiaries or other affiliates. Although the terms of any such transactions will be established based upon negotiations between employees of the companies involved, there can be no assurance that the terms of any such transactions will be as favorable to us or our subsidiaries or affiliates as would be the case where the parties are completely at arm’s length.

We may not achieve some or all of the expected benefits of the Spin-off.

We may not be able to achieve the full strategic and financial benefits expected to result from the Spin-off, or such benefits may be delayed or not occur at all. The Spin-off is expected to provide the following benefits to the Company: (i) allow FRP to focus on its own strategic objectives and opportunities, (ii)  enable FRP to allocate resources and deploy capital in a manner consistent with its own priorities, (iii) allow FRP to use its separate publicly traded stock as acquisition currency, (iv) allow FRP to more effectively utilize equity compensation awards by directly tying the value of equity compensation awards to the performance of the real estate business, and (v) allow investors, both current and prospective, to value FRP based on its financial characteristics and make investment decisions based on those characteristics. If we fail to achieve some or all of the benefits expected to result from the Spin-off, or if such benefits are delayed, the business, financial condition and results of our operations could be adversely affected and the value of our stock could be impacted.

FRP is subject to restrictions under a Tax Matters Agreement with Patriot, and a violation of the tax sharing agreement may result in tax liability to FRP and its shareholders.

In connection with the Spin-off, we entered into a Tax Matters Agreement with Patriot to preserve the tax-free treatment of the separation and distribution of Patriot. Under the Tax Matters Agreement, both companies are restricted from taking any action that prevents the Spin-off and related transactions from being tax-free for U.S. federal income tax purposes. Under the Tax Matters Agreement, for the two-year period following the Spin-off, FRP will be prohibited, except in certain circumstances, from:

• entering into any transaction resulting in the acquisition of 50% or more of its stock or substantially all of its assets, whether by merger or otherwise;

• merging, consolidating, or liquidating;

• issuing equity securities beyond certain thresholds;

• repurchasing its capital stock; and

• ceasing to actively conduct its business.

These restrictions may limit FRP’s ability to pursue certain strategic transactions or other transactions that it

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may believe to be in the best interests of its shareholders or that might increase the value of its business. In addition, under the Tax Matters Agreement, FRP is required to indemnify Patriot against any such tax liabilities as a result of the acquisition of FRP’s stock or assets, even if it did not participate in or otherwise facilitate the acquisition. This may result in missed opportunities or the pursuit of business strategies that may not be as beneficial for us and which may negatively affect our anticipated profitability. If Patriot fails to comply with the restrictions in the Tax Matters Agreement and as a result the Spin-off was determined to be taxable for U.S. federal income tax purposes, FRP and its shareholders at the time of the Spin-off that are subject to U.S. federal income tax could incur significant U.S. federal income tax liabilities. Although the tax sharing agreement provides that Patriot is required to indemnify us for taxes incurred that may arise were Patriot to fail to comply with its obligations under the Tax Matters Agreement, there is no assurance that Patriot will have the funds to satisfy that liability.

The business of the Company is less diversified.

Our operational and financial profile has changed as a result of the Spin-off of the transportation business. As a result, our diversification of revenue sources has diminished without the revenue previously generated by the transportation business, and our results of operations, cash flows, working capital and financing requirements may be subject to increased volatility related to the real estate business. If we are unable to manage that volatility, our business, financial condition and results of operations could be materially and adversely affected.

Risks Relating to Our Business

Our business may be adversely affected by seasonal factors and harsh weather conditions.

The Mining Royalty Lands Segment and the Land Development and Construction Segment could be adversely affected by reduced construction and mining activity during periods of inclement weather. These factors could cause our operating results to fluctuate from quarter to quarter. An occurrence of unusually harsh or long-lasting inclement weather such as hurricanes, tornadoes and heavy snowfalls could have an adverse effect on our operations and profitability.

Our revenues depend in part on construction sector activity, which tends to be cyclical.

Our Mining Royalty Lands Segment revenues are derived from royalties on construction aggregates mined on our properties. Thus, our results depend in part on residential, commercial and infrastructure construction activity and spending levels. The construction industry in our markets tends to be cyclical. Construction activity and spending levels vary across our markets and are influenced by interest rates, inflation, consumer spending habits, demographic shifts, environmental laws and regulations, employment levels and the availability of funds for public infrastructure projects. Economic downturns may lead to recessions in the construction industry, either in individual markets or nationally.

Our operations are subject to various environmental laws and regulations, the violation of which could result in substantial fines or penalties.

Liability for environmental contamination on real property owned by the Company may include the following costs, without limitation: investigation and feasibility study costs, remediation costs, litigation costs, oversight costs, monitoring costs, institutional control costs, penalties from state and federal agencies and third-party claims. These costs could be substantial and in extreme cases could exceed the value of the contaminated property. Moreover, on-site operations may be suspended until certain environmental contamination is remediated and/or permits are received, and governmental agencies can impose permanent restrictions on the manner in which a property may be used depending on the extent and nature of the contamination. This may result in a breach of the terms of the lease entered into with our tenants. Governmental agencies also may create liens on contaminated sites for damages it incurred to address such contamination. In addition, the presence of hazardous substances at, on, under or from a property may adversely affect our ability to sell the property or borrow funds using the property as collateral, thus harming our financial condition.

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The presence of contaminated material at our RiverFront on the Anacostia development site will subject us to substantial environmental liability and costs as construction proceeds.

With respect to our RiverFront on the Anacostia site in Washington, D.C., preliminary environmental testing has indicated the presence of contaminated material that will have to be specially handled in excavation in conjunction with construction. While we have recovered and will continue to seek partial reimbursement for these costs from our prior tenant and/or neighboring property owners, we still expect to incur significant environmental costs in connection with construction.

With respect to Phase I of the development, we recorded an expense in the fourth quarter of fiscal 2012 of $1,771,000 for this environmental remediation liability which is the lower end of the range of estimates. As of September 30, 2015 the excavation and foundation work for Phase I were substantially complete; thus, the bulk of the remediation expenses have been incurred. Management believes the total cost for remediation of Phase 1 will end up at approximately $1.9 million.

During the quarter ending December 31, 2015, management successfully completed negotiations and entered into a $3,000,000 settlement of environmental claims on all four phases against our former tenant at the Riverfront on the Anacostia property and continues to pursue settlement negotiations with other potentially responsible parties.

The Company executed a letter of intent with MRP Realty in May 2016 to develop Phase II of the Riverfront on the Anacostia project and recorded an estimated environmental remediation expense of $2.0 million for the Company’s estimated liability under the proposed agreement.

The Company has no obligation to remediate this contamination on Phases III and IV until such time as it commences construction there.

Uninsured losses could significantly reduce our earnings.

We self-insure for a portion of our claims exposure resulting from workers’ compensation, auto liability, general liability and employees’ health insurance. We also are responsible for our legal expenses relating to such claims. We maintain insurance above the amounts for which we self-insure with licensed insurance carriers. Although we believe the aggregate insurance limits should be sufficient to cover reasonably expected claims, it is possible that one or more claims could exceed our aggregate coverage limits. Additionally, there are certain losses, such as losses from hurricanes, terrorism, wars or earthquakes, where insurance is limited or not economically justifiable. If the Company experiences an uninsured loss of real property, we could lose both the invested capital and anticipated revenues associated with such property. We accrue currently for estimated incurred losses and expenses and periodically evaluate and adjust our claims accrued liability to reflect our experience. However, ultimate results may differ from our estimates, which could result in losses greater than accrued amounts.

We may be unable to renew leases or re-lease properties as leases expire.

When a lease expires, a tenant may elect not to renew it. If that occurs, we may not be able to lease the property on similar terms. The terms of renewal or re-lease (including the cost of required renovations and concessions to tenants) may be less favorable than the prior lease. If we are unable to lease all or substantially all of our properties, or if the rental rates upon such re-leasing are significantly lower than expected rates, our cash generated before debt repayments and capital expenditures may be adversely affected. As of September 30, 2016, leases of our properties representing approximately 17.4%, 23.0%, and 9.6% of the total square footage of buildings completed prior to September 30, 2016 are scheduled to expire in fiscal years 2017, 2018 and 2019, respectively.

We may be unable to lease currently vacant properties.

As of September 30, 2016, 10.1% of our properties are vacant. If we are unable to obtain leases sufficient to

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cover carrying costs then our cash flows may be adversely affected.

The bankruptcy or insolvency of significant tenants with long-term leases may adversely affect income produced by our properties.

We have 20 buildings in our portfolio that are single-tenant leased, representing 52% of developed property rentals under long-term leases. We have 8 other tenants with leases in excess of five years. Should tenants default on their obligations, our cash flow would be adversely affected and we may not be able to find another tenant to occupy the space under similar terms or may have to make expenditures to retrofit or divide the space. Additionally, we may have to incur a non-cash expense for a significant amount of deferred rent revenue generated from the accounting requirement to straight-line rental revenues. The bankruptcy or insolvency of a major tenant may also adversely affect the income produced by a property. If any of our tenants become a debtor in a case under the U.S. Bankruptcy Code, we cannot evict that tenant solely because of its bankruptcy. The bankruptcy court may authorize the tenant to reject and terminate its lease with the Company. Our claim against such a tenant for unpaid future rent would be subject to a statutory limitation that may be substantially less than the remaining rent actually owed to us under the tenant’s lease. Any shortfall in rent payments could adversely affect our cash flow.

A decline in the economic conditions in Baltimore, Washington, D.C. and Northern Virginia markets could adversely affect our business.

Nearly all of our office and warehouse properties are located in the Baltimore, Washington, D.C. and Northern Virginia areas. As a result of our geographic concentration, we depend upon the local conditions in these markets, including local real estate conditions. We are, therefore, subject to increased exposure (positive or negative) to economic and other competitive factors specific to markets in confined geographic areas. Our operations may also be affected if too many competing properties are built in these markets. An economic downturn in these markets could adversely affect our operation. We cannot be sure that these markets will continue to grow or will continue to provide favorable demand for our office and warehouse spaces.

Our inability to obtain necessary approvals for property development could adversely affect our profitability.

We may be unable to obtain, or incur delays in obtaining, necessary zoning, land-use, building, occupancy and other required governmental permits and authorizations, which could result in increased costs or abandonment of certain projects. Before we can develop a property, we must obtain a variety of approvals from local and state governments with respect to such matters as zoning, density, parking, subdivision, site planning and environmental issues. Legislation could impose moratoriums on new real estate development or land-use conversions from mining to development. These factors may reduce our profit or growth and may limit the value of these properties.

Real estate investments are not as liquid as other types of assets.

The illiquid nature of real estate investments may limit our ability to react promptly to changes in economic or other conditions. In addition, significant expenditures associated with real estate investments, such as mortgage payments, real estate taxes and maintenance costs, are generally not reduced when circumstances cause a reduction in income from the investments. Thus, the illiquid nature of our real estate investments could adversely affect our profitability under certain economic conditions.

Our debt service obligations may have adverse consequences on our business operations.

We use debt to finance our operations, including acquisitions of properties. Our use of debt may have adverse consequences, including the following:

· Our cash flows from operations may not be sufficient to meet required payments of principal and interest.

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· We may be forced to dispose of one or more of our properties, possibly on disadvantageous terms, to make payments on our debt.

· We may default on our debt obligations, and the lenders may foreclose on our properties that collateralize those loans.

· A foreclosure on one of our properties could create taxable income without any accompanying cash proceeds to pay the tax.

· A default under a mortgage loan that has cross default provisions may cause us to automatically default on another loan.

· We may not be able to refinance or extend our existing debt.

· The terms of any refinancing or extension may not be as favorable as the terms of our existing debt.

· We may not be able to issue debt on unencumbered properties under reasonable terms to finance growth of our portfolio of properties.

· We may be subject to a significant increase in the variable interest rates on our unsecured and secured lines of credit, which could adversely impact our operations.

· Our debt agreements have yield maintenance requirements that result in a penalty if we prepay loans.

As of September 30, 2016, we had outstanding non-recourse mortgage indebtedness of $36,012,000, secured by developed real estate properties having a carrying value of $45,478,000.

Our uncollateralized revolving credit agreement restricts our ability to engage in some business activities.

Our uncollateralized revolving credit agreement contains customary negative covenants and other financial and operating covenants that, among other things:

· restricts our ability to incur certain additional indebtedness;

· restricts our ability to make certain investments;

· restricts our ability to merge with another company;

· restricts our ability to pay dividends;

· requires us to maintain financial coverage ratios; and

· requires us to not encumber certain assets except as approved by the lenders.

These restrictions could cause us to default on our unsecured line of credit or negatively affect our operations.

Our Asset Management and Land Development and Construction Segments face competition from numerous sources.

As a developer of flexible warehouse and office space, we compete with numerous developers, owners and operators of real estate, many of whom own properties similar to ours in the same submarkets in which our properties are located. If our competitors offer space at rental rates below current market rates, or below the rental rates we currently charge our tenants, we may lose potential tenants and we may be pressured to reduce our rental rates to an amount lower than we currently charge in order to retain tenants when our tenants’ leases expire. As a result, our financial condition, results of operations, cash flow and ability to satisfy our debt service obligations could be materially adversely affected.

Construction costs may be higher than anticipated.

Our long-term business plan includes a number of construction projects. The construction costs of these projects may exceed original estimates and possibly make the completion of a property uneconomical. Building material commodity shortages, construction delays or stoppages or rapidly escalating construction costs may out-pace market rents, which would adversely affect our profits. The market environment and existing lease commitments may not allow us to raise rents to cover these higher costs.

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Risks Relating to our Common Stock

Certain shareholders have effective control of a significant percentage of FRP's common stock and likely will control the outcome of any shareholder vote.

As of September 30, 2016, two of our directors, John D. Baker, II and Thompson S. Baker, II beneficially own approximately 19% of the outstanding shares of our common stock (80% of such shares are held in trusts under which voting power is shared with other family members) and certain of their family members beneficially own an additional 11.8%. As a result, these individuals effectively may have the ability to direct the election of all members of our board of directors and to exercise a controlling influence over its business and affairs, including any determinations with respect to mergers or other business combinations involving the Company, its acquisition or disposition of assets, its borrowing of monies, its issuance of any additional securities, its repurchase of common stock and its payment of dividends.

Provisions in our articles of incorporation and bylaws and certain provisions of Florida law could delay or prevent a change in control of FRP.

The existence of some provisions of our articles of incorporation and bylaws and Florida law could discourage, delay or prevent a change in control of FRP that a shareholder may consider favorable. These include provisions:

• providing that  directors may be removed by our shareholders only for cause;

• authorizing a large number of shares of stock that are not yet issued, which would allow FRP’s board of directors to issue shares to persons friendly to current management, thereby protecting the continuity of its management, or which could be used to dilute the stock ownership of persons seeking to obtain control of FRP;

• prohibiting shareholders from calling special meetings of shareholders or taking action by written consent; and

• imposing advance notice requirements for nominations of candidates for election to our board of directors at the annual shareholder meetings.

These provisions apply even if a takeover offer may be considered beneficial by some shareholders and could delay or prevent an acquisition that our board of directors determines is not in the Company’s or the shareholders’ best interests.

FRP may issue preferred stock with terms that could dilute the voting power or reduce the value of our common stock.

Our articles of incorporation authorize us to issue, without the approval of our shareholders, one or more classes or series of preferred stock having such designations, powers, preferences and relative, participating, optional and other rights, and such qualifications, limitations or restrictions as our board of directors generally may determine. The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the value of FRP's common stock. For example, FRP could grant holders of preferred stock the right to elect some number of its directors in all events or on the happening of specified events or the right to veto specified transactions. Similarly, the repurchase or redemption rights or dividend, distribution or liquidation preferences FRP could assign to holders of preferred stock could affect the residual value of the common stock.

Item 1B. UNRESOLVED STAFF COMMENTS.

None.

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Item 2. PROPERTIES.

The Company owns (predominately in fee simple but also through ownership of interests in joint ventures) over 20,000 acres of land in Florida, Georgia, Maryland, Virginia, Delaware and the District of Columbia. This land is generally held by the Company in three distinct categories (i) land owned and leased to mining companies for royalties or rents, (ii) land owned and operated as income producing rental properties predominately in the form of warehouse/office buildings, and (iii) land owned and held for investment to be further developed for future income production or sales to third parties.

Mining Royalty Lands Segment – Mining Properties. The following table summarizes the Company's mining royalty lands and estimated reserves at September 30, 2016 a substantial portion of which are leased to Vulcan Materials.

		Tons of
	Tons Sold	Estimated
	in Year	Reserves
	Ended	at
	9/30/16	9/30/16	Approximate
	(000's)	(000's)	Acres Owned
The Company owns nine
locations currently being
mined in Grandin, Keuka,
Newberry, Astatula and Airgrove, Florida;
Columbus, Macon, and Tyrone, Georgia;
and Manassas, Virginia.	6,538	321,916	11,328
The Company owns four locations that are
leased for mining but are not currently being
mined in Ft. Myers (Lee County), Marion
County and Lake County, Florida and
and Forest Park, Georgia.	0	87,827	3,867

This table excludes the Brooksville, Florida property, approximately 4,280 acres, as it was transferred on October 4, 2006 to a joint venture with Vulcan Materials Company (“Vulcan Materials”) for future development.

In May, 2014 the Company entered into an amendment to our lease agreement for our Ft. Myers location requiring that the mining be accelerated and that the mining plan be conformed to accommodate the future construction of up to 105 residential dwelling units around the mined lakes. In return, the Company agreed to sell Lee County a right of way for a connector road that would benefit the residential area on our property and to place a conservation easement on part of the property. Based on information from our tenant, Vulcan Materials Company, the Company is hopeful that all necessary permits to commence mining on this property will be received during fiscal 2017.

During fiscal 2015, the Company also received positive information from Vulcan Materials with respect to two other locations. With regard to our Manassas, Virginia location, Vulcan Materials informed us that they recently removed a concrete plant off property owned by the Company which opened up an additional 25 million tons of material to be mined from Company property. Vulcan Materials’ current lease term at the Manassas location expires on May 31, 2020 and they have one additional ten year extension option available. At our Astatula location, Vulcan Materials began mining on Company property during fiscal 2015 and plans are to continue that mining for the foreseeable future at volumes commensurate with, or in excess of, those achieved in fiscal 2015.

Mining Royalty Lands Segment - Brooksville Joint Venture. On October 4, 2006, a subsidiary of the Company (Florida Rock Properties, Inc.) entered into a Joint Venture Agreement with Florida Rock Industries,

11 

Inc. (which was acquired by Vulcan Materials in 2007) to form Brooksville Quarry, LLC, a real estate joint venture, to develop approximately 4,280 acres of land near Brooksville, Florida as a mixed-use community. In April 2011, the Florida Department of Community Affairs issued its Final Order approving the development of the Project consisting of 5,800 residential dwelling units and over 600,000 square feet of commercial and 850,000 of light industrial uses. The Master Plan zoning for the Project was approved by the County in August 2012. Vulcan Materials still mines on the property and the Company receives 100% of the royalty on all tons sold at the Brooksville location. In fiscal 2016, 404,000 tons were sold and estimated reserves were 5,698,000 as of September 30, 2016. During fiscal 2015, the Company agreed to extend the mining lease on this property for an additional four years, through the year 2022, in exchange for an immediate increase in the annual minimum royalty and a higher royalty rate on tons sold and mined from the property.

Mining Royalty Lands Segment - Other Properties. The segment also owns an additional 1,923 acres of investment properties in Gulf Hammock (approximately 1,600 acres currently on the market for $4.5 million), Brooksville, Palatka, and Polk County, Florida and Yatesville and Henderson, Georgia.

Asset Management Segment. As of September 30, 2016, the Asset Management Segment owned 42 warehouse/office buildings, totaling 3,880,365 square feet, all of which (with the exception of one building) are in the Mid-Atlantic region of the United States as follows:

1) Hillside Business Park in Anne Arundel County, Maryland consists of four warehouse/office buildings and one suburban office building totaling 567,473 square feet.

2) Lakeside Business Park in Harford County, Maryland consists of nine warehouse/office buildings totaling 893,722 square feet.

3) 6920 Tudsbury Road in Baltimore County, Maryland consists of one warehouse/office building totaling 86,100 square feet.

4) 8620 Dorsey Run Road in Howard County, Maryland consists of one warehouse/office building totaling 85,100 square feet.

5) Rossville Business Center in Baltimore County, Maryland consists of two warehouse/office buildings totaling 190,517 square feet.

6) 34 Loveton Circle in suburban Baltimore County, Maryland consists of one office building totaling 33,708 square feet (24% of the space is occupied by the Company for use as our Baltimore headquarters).

7) Oregon Business Center in Anne Arundel County, Maryland consists of two warehouse/office buildings totaling 195,615 square feet.

8) Arundel Business Center in Howard County, Maryland consists of two warehouse/office buildings totaling 162,796 square feet.

9) 100-200 Interchange Boulevard in New Castle County, Delaware consists of two warehouse/office buildings totaling 303,006 square feet.

10) Windlass Run Business Park in Baltimore County, Maryland consists of one warehouse/office building totaling 69,474 square feet.

11) 155 E. 21^st Street in Duval County, Florida consists of one office building totaling 68,757 square feet.

12) Hollander 95 Business Park in Baltimore City, Maryland consists of two warehouse/office building totaling 162,350 square feet.

13) Patriot Business Park in Prince William County, Virginia consists of three warehouse/office buildings

12 

totaling 373,000 square feet.

14) Transit Business Park in Baltimore, Maryland consists of five buildings totaling 232,318 square feet.

15) Kelso Business Park in Baltimore County, Maryland, consists of two warehouse/office buildings totaling 69,680 square feet.

16) 1187 Azalea Garden Road in Norfolk, VA consists of one warehouse totaling 188,093 square feet.

17) 10820 Gilroy Road in Baltimore County, Maryland, consists of one warehouse/office building totaling 107,438 square feet.

18) 7700 Port Capital Drive in Howard County, Maryland consists of one warehouse/office building totaling 91,218 square feet.

Land Development and Construction Segment – Warehouse/Office Land.

At September 30, 2016 this segment owned the following future development parcels:

1) 20 acres of horizontally developed land available for future construction of an additional 286,500 square feet of warehouse/office product at Lakeside Business Park in Harford County, Maryland.

2) 17.5 acres of horizontally developed land available for future construction of 164,500 square feet of office buildings representing our 50% interest in a joint venture at Windlass Run Business Park in Baltimore County, Maryland.

3) 25 acres of horizontally developed land available for future construction of 202,653 square feet of warehouse/office product at Patriot Business Park in Prince William County, Virginia.

4) 33 acres of horizontally developed land available for future construction of 319,950 square feet of warehouse, office, hotel and flex buildings at Hollander 95 Business Park in Baltimore City, Maryland.

Land Development and Construction Segment – Land Held for Investment or Sale.

1) The Windlass Run Residential (previously Bird River) Phase 2 property consists of 74 useable acres located in southeastern Baltimore County, Maryland, adjacent to our Windlass Run Business Park. The Company rezoned the property in September 2007 to allow for additional residential density. The Company executed two contracts on April 17, 2013 for the sale of phase 1 of the property in the quarter ending September 30, 2013 for $8.0 million and the balance for $11.0 million approximately 18 months later. The sale of phase 1 was completed in August of 2013 and resulted in a gain of $4,928,000. The sale of phase two was originally scheduled to close in March of 2015 but was extended by the Buyer on March 20, 2015 with payment of an $187,754 extension fee to allow closing on or before September 30, 2015. Closing occurred on October 30, 2015.

2) The RiverFront on the Anacostia property is a 5.8 acre parcel of real estate in Washington D.C. that fronts the Anacostia River and is adjacent to the Washington Nationals Baseball Park. The approved planned unit development permits the Company to develop a four building, mixed use project, containing approximately 545,800 square feet of office and retail uses and approximately 569,600 square feet of residential and hotel uses. The approved development would include numerous publicly accessible open spaces and a waterfront esplanade along the Anacostia River.

On March 30, 2012 the Company entered into a Contribution Agreement with MRP SE Waterfront Residential, LLC. (“MRP”) to form a joint venture to develop the first phase only of the four phase master development known as RiverFront on the Anacostia in Washington, D.C. The purpose of the Joint Venture is to develop, own, lease and ultimately sell a 305 unit residential apartment building

13 

(including approximately 18,000 square feet of retail) on approximately 2 acres of the site. The joint venture, RiverFront Investment Partners I, LLC (“RiverFront I”) was formed in June 2013 as contemplated. The Company contributed land with an agreed to value of $13,500,000 (cost basis of $6,165,000) and contributed cash of $4,866,000 to the Joint Venture for a 76.91% stake in the venture. MRP contributed capital of $5,553,000 to the joint venture including development costs paid prior to formation of the joint venture. The Joint Venture closed on $17,000,000 of EB5 secondary financing and a nonrecourse construction loan for $65,000,000 on August 8, 2014. Both of these financings are non-recourse to the Company. Construction commenced in October 2014 and occupancy started in August 2016. The Company’s equity interest in the joint venture is accounted for under the equity method of accounting as MRP acts as the administrative agent of the joint venture and oversees and controls the day to day operations of the project.

On August 24, 2015, in anticipation of commencing construction of the new Frederick Douglass bridge at a location immediately to the West of the existing bridge, the District of Columbia filed a Declaration of Taking for a total of 7,390 square feet of permanent easement and a 5,022 square foot temporary construction easement on land along the western boundary of the land that will ultimately hold Phase III and IV. Previously, the Company and the District had conceptually agreed to a land swap with no compensation that would have permitted the proposed new bridge, including construction easements, to be on property wholly owned by the District. As a result, the Planned Unit Development was designed and ultimately approved by the Zoning Commission as if the land swap would occur once the District was ready to move forward with the new bridge construction. In September 2016 the Company received $1,115,400 as settlement for the easement. The Company will continue to seek an agreement from the District that the existing bridge easement will terminate when the new bridge has been placed in service and the existing bridge has been removed. The Company’s position is that otherwise Phase IV will be adversely impacted and additional compensation or other relief will be due the Company.

3) The Hampstead Trade Center property in Hampstead, Carroll County, Maryland is a 117 acre parcel located adjacent to the State Route 30 bypass. The parcel was previously zoned for industrial use. In the fourth quarter of fiscal 2016, the Company received approval from the Town of Hampstead and has rezoned the property for residential use. Management believes this to be a higher and best use of the property.

4) The Square 664E property is approximately 2 acres and sits on the Anacostia River at the base of South Capitol Street approximately 1 mile down river from our RiverFront on the Anacostia property. This property is currently under lease to Vulcan Materials for use as a concrete batch plant. The lease terminates on August 31, 2021 and Vulcan has the option to renew for one additional period of five (5) years. In the quarter ending December 31, 2014, the District of Columbia announced that it had selected an approximate 5 acre site adjacent to this property for the future construction of the new DC United major league soccer stadium. Construction is underway to completely rebuild the existing bulkhead in anticipation of future high rise development on this property.

Item 3. LEGAL PROCEEDINGS.

Note 13 to the consolidated financial statements included in the accompanying 2016 Annual Report to Shareholders is incorporated herein by reference.

Item 4. MINE SAFETY DISCLOSURES.

None.

PART II

14 

Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

There were approximately 414 holders of record of FRP Holdings, Inc. common stock, $.10 par value, as of September 30, 2016. The Company's common stock is traded on the Nasdaq Stock Market (Symbol FRPH).

Price Range of Common Stock. Information concerning stock prices is included under the caption "Quarterly Results" on page 7 of the Company's 2016 Annual Report to Shareholders, and such information is incorporated herein by reference.

Dividends. The Company has not paid a cash dividend in the past and it is the present policy of the Board of Directors not to pay cash dividends. Information concerning restrictions on the payment of cash dividends is included in Note 5 to the consolidated financial statements included in the accompanying 2016 Annual Report to Shareholders and such information is incorporated herein by reference.

Securities Authorized for Issuance Under Equity Compensation Plans. Information regarding securities authorized for issuance under equity compensation plans is included in Item 12 of Part III of this Annual Report on Form 10-K and such information is incorporated herein by reference.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

						(c)
						Total
						Number of
						Shares		(d)
						Purchased		Approximate
		(a)				As Part of		Dollar Value of
		Total		(b)		Publicly		Shares that May
		Number of		Average		Announced		Yet Be Purchased
		Shares		Price Paid		Plans or		Under the Plans
Period		Purchased		per Share		Programs		or Programs (1)
	July 1
	Through
	July 31		—	$	—		—	$	4,957,000
	August 1
	Through
	August 31		—	$	—		—	$	4,957,000
	September 1
	Through
	September 30		—	$	—		—	$	4,957,000
	Total		—	$	—		—

(1) On February 4, 2015, the Board of Directors authorized management to expend up to $5,000,000 to repurchase shares of the Company’s common stock from time to time as opportunities arise.

Item 6. SELECTED FINANCIAL DATA.

Information required in response to this Item 6 is included under the caption "Five Year Summary" on page 7 of the Company's 2016 Annual Report to Shareholders and such information is incorporated herein by reference.

15 

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

Information required in response to Item 7 is included under the caption "Management’s Discussion and Analysis of Financial Condition and Results of Operation" on pages 8 through 18 of the Company’s 2016 Annual Report to Shareholders and such information is incorporated herein by reference.

Item 7.A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Interest Rate Risk - We are exposed to the impact of interest rate changes through our variable-rate borrowings under Credit Agreements with Wells Fargo and First Tennessee Bank.

Under the Wells Fargo Credit Agreement, the applicable margin for borrowings at September 30, 2016 was 1.4%. The applicable margin for such borrowings will be increased in the event that our debt to capitalization ratio as calculated under the Wells Fargo Credit Agreement Facility exceeds a target level.

The applicable borrowing margin at September 30, 2016 with First Tennessee Bank was 1.9%.

At September 30, 2016 a 1% increase in the current per annum interest rate would result in $68,070 of additional interest expense during the next 12 months under the Wells Fargo Credit Agreement. The foregoing calculation assumes an instantaneous 1% increase in the rates under the Credit Agreement and that the principal amount under the Credit Agreement is the amount outstanding as of September 30, 2016. The calculation, therefore, does not account for the differences in the market rates upon which the interest rates of our indebtedness are based or possible actions, such as prepayment, which we may take in response to any rate increase.

For our debt instruments with variable interest rates, changes in interest rates affect the amount of interest expense incurred. The following table provides information about the Company’s long-term debt and variable rate debt outstanding at September 30, 2016 (dollars in thousands):

											There				Fair
Liabilities:	2017		2018		2019		2020		2021		after		Total		Value
Scheduled
maturities of
long-term debt:
Fixed Rate	$	4,455	$	4,673	$	3,885	$	3,725	$	3,485	$	15,789	$	36,012	$	39,409
Average interest rate		6.1%		6.0%		5.9		5.8		5.8		5.8
Variable Rate	$	6,807
Average interest rate		2.0%

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Information required in response to this Item 8 is included under the caption "Quarterly Results" on page 7 and on pages 19 through 33 of the Company's 2016 Annual Report to Shareholders. Such information is incorporated herein by reference.

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

None.

16 

Item 9A. CONTROLS AND PROCEDURES.

CONCLUSION REGARDING THE EFFECTIVENESS OF DISCLOSURE CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including our principal executive officer, principal financial officer and chief accounting officer, we conducted an evaluation of our disclosure controls and procedures, as such terms is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on this evaluation, our principal executive officer, our principal financial officer and our chief accounting officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Annual Report.

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation under the framework in the Internal Control-Integrated Framework (2013), our management concluded that our internal control over financial reporting was effective as of September 30, 2016.

Hancock Askew & Co., LLP, the independent registered certified public accounting firm that audited the consolidated financial statements included in this Annual Report on Form 10-K, has also audited the effectiveness of our internal control over financial reporting as of September 30, 2016, as stated in their report which appears in Item 8.

CHANGE IN INTERNAL CONTROL OVER FINANCIAL REPORTING

During the fourth quarter of 2016, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

INHERENT LIMITATIONS OVER INTERNAL CONTROLS

Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

i. pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

ii. provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

iii. provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.

17 

Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations, including the possibility of human error and circumvention by collusion or overriding of controls. Accordingly, even an effective internal control system may not prevent or detect material misstatements on a timely basis. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

ITEM 9B. OTHER INFORMATION.

None.

PART III

Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Information regarding the Company’s executive officers and directors (including the disclosure regarding audit committee financial experts), required in response to this Item 10, is included under the captions “Board of Directors and Corporate Governance- Our Board of Directors,” “Board of Directors and Corporate Governance- Board Leadership,” “Board of Directors and Corporate Governance- Board Committees,” “Board of Directors and Corporate Governance- Business Conduct Policies,” “Securities Ownership- Section 16(a) Beneficial Ownership Reporting Compliance,” and “Compensation Discussion and Analysis” in the Company's Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2016.

The Company has adopted a Financial Code of Ethical Conduct applicable to its principal executive officers, principal financial officers and principal accounting officers. A copy of this Financial Code of Ethical Conduct is filed as Exhibit 14 to this Form 10-K. The Financial Code of Ethical Conduct is available on our web site at www.frpholdings.com under the heading Corporate Governance.

Item 11. EXECUTIVE COMPENSATION.

Information required in response to this Item 11 is included under the captions "Board of Directors and Corporate Governance- Board Committees- Compensation Committee,” “Non-Employee Director Compensation,” “Compensation Discussion and Analysis” and “Executive Compensation” in the Company's Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2016.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

Information required in response to this Item 12 is included under the captions “Securities Ownership” in the Company's Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2016.

Equity Compensation Plan Information

18 

				Number of Securities
				remaining available
	Number of Securities			for future issuance
	to be issued upon		Weighted average	under equity
	exercise of		exercise price of	compensation plans
	outstanding options,		outstanding options,	(excluding securities
	warrants and rights		warrants and rights	reflected in column (a))
Plan Category	(a)		(b)	(c)
Equity compensation plans
approved by security holders	263,560	$	23.50	384,430
Equity compensation plans
not approved by security holders	0		0	0
Total	263,560	$	23.50	384,430

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Information required in response to this Item 13 is included under the caption “Related Party Transactions” and “Board of Directors and Corporate Governance- Director Independence” in the Company's Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2016.

Item 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Information required in response to this Item 14 is included under the captions “Independent Registered Public Accounting Firm” in the Company’s Proxy Statement and such information is incorporated herein by reference. The Proxy Statement will be filed with the Securities and Exchange Commission not later than December 31, 2016.

PART IV

Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULE.

(a) (1) and (2) Financial Statements and Financial Statement Schedule.

The response to this item is submitted as a separate section. See Index to Financial Statements and Financial Statement Schedule on page 23 of this Form 10-K.

(3) Exhibits.

The response to this item is submitted as a separate section. See Exhibit Index on pages 21 through 22 of this Form 10-K.

19 

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		FRP Holdings, Inc.
Date:  December 12, 2016	By	THOMPSON S. BAKER II
		Thompson S. Baker II
		Chief Executive Officer
		(Principal Executive Officer)
	By	JOHN D. MILTON, JR.
		John D. Milton, Jr.
		Executive Vice President, Treasurer,
		Secretary and Chief Financial Officer
		(Principal Financial Officer)
	By	JOHN D. KLOPFENSTEIN
		John D. Klopfenstein
		Controller and Chief Accounting
		Officer (Principal Accounting Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on December 12, 2016.

/s/ Thompson S. Baker II Chief Executive Officer (Principal Executive Officer	/s/ Charles E. Commander III Charles E. Commander III Director
/s/ John D. Milton, Jr. Executive Vice President, Treasurer, Secretary and Chief Financial Officer (Principal Financial Officer)	/s/ H. W. Shad III H. W. Shad III Director
/s/ John D. Baker II John D. Baker II Executive Chairman	/s/ Martin E. Stein, Jr. Martin E. Stein, Jr. Director
/s/ John D. Klopfenstein John D. Klopfenstein Controller and Chief Accounting Officer (Principal Accounting Officer)	/s/ William H. Walton William H. Walton Director

20 

FRP HOLDINGS, INC.

FORM 10-K FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2016

EXHIBIT INDEX

Item 15(a)(3)

2.1	Separation and Distribution Agreement, dated as of January 30, 2015, by and between FRP Holdings, Inc. and Patriot Transportation Holding, Inc., incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K filed on February 3, 2015.
3.1	Second Amended and Restated Articles of Incorporation of FRP Holdings, Inc., adopted February 4, 2015, incorporated by reference to Exhibit 3.1 of the Company’s Form 10-Q filed on May 8, 2015.
3.2	Second Amended and Restated Bylaws of FRP Holdings, Inc., adopted February 4, 2015.*
4.1	Articles III, V and X of the Second Amended and Restated Articles of Incorporation of FRP Holdings, Inc, incorporated by reference to Exhibit 3.1 of this Form 10-K..
10.1	Tax Matters Agreement, dated January 30, 2015 by and between FRP Holdings, Inc. and Patriot Transportation Holding, Inc., incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K filed on February 3, 2015.
10.2	Employee Matters Agreement, dated January 30, 2015 by and between FRP Holdings, Inc. and Patriot Transportation Holding, Inc., incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K filed on February 3, 2015.
10.3	Transition Services Agreement, dated January 30, 2015 by and between FRP Holdings, Inc. and Patriot Transportation Holding, Inc., incorporated by reference to Exhibit 10.3 to the Company’s Form 8-K filed on February 3, 2015.
10.4	Credit Agreement, dated January 30, 2015, by and between FRP Holdings, Inc. and Wells Fargo Bank, N.A., incorporated by reference to exhibit 10.1 of the Company’s Form 10-Q filed on May 8, 2015.
10.5	Loan Agreement, dated July 24, 2015 by and among  FRP Development Corp., FRP Manassas and First Tennessee Bank National Association.*
10.6	Mining Lease Agreement, dated September 1, 1986, between Florida Rock Industries, Inc. and Florida Rock Properties, Inc., successor by merger to Grandin Land, Inc., incorporated by reference to an exhibit previously filed with Form S-4 dated December 13, 1988. File No. 33-26115.
10.7	Summary of Medical Reimbursement Plan of FRP Holdings, Inc., incorporated by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 1993. File No. 33-26115.
10.8	Summary of Management Incentive Compensation Plans, incorporated by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 1994. File No. 33-26115.
10.9	Management Security Agreements between the Company and certain officers, incorporated by reference to a form of agreement previously filed (as Exhibit (10)(I)) with Form S-4 dated December 13, 1988. File No. 33-26115.
10.10	FRP Holdings, Inc. 2000 Stock Option Plan, incorporated by reference to an appendix to the Company’s Proxy Statement dated December 15, 1999. File No. 33-26115.
10.11	FRP Holdings, Inc. 2006 Stock Incentive Plan, incorporated by reference to an appendix to the Company’s Proxy Statement dated December 29, 2005. File No. 33-26115.
10.12	Joint Venture Agreement between Florida Rock Industries, Inc. and Florida Rock Properties, incorporated by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 2006. File No. 33-26115.
10.13	Letter Agreement between the Company and David H. deVilliers, Jr., incorporated by reference to an exhibit filed with Form 10-Q for the quarter ended December 31, 2007. File No. 33-26115.
10.14	Letter Agreement between the Company and John D. Klopfenstein, incorporated by reference to an exhibit filed with Form 10-Q for the quarter ended December 31, 2007. File No. 33-26115.
10.15	Limited Liability Company Agreement of RiverFront Investment Partners I LLC. Between FRP RiverFront I LLC and MRP SE Waterfront Residential LLC. incorporated by reference to an exhibit filed with Form 10-Q for the quarter ended June 30, 2013.  File No. 33-26115.
13.1	The Company's 2015 Annual Report to shareholders, portions of which are incorporated by reference in this Form 10-K. Those portions of the 2015 Annual Report to Shareholders which are not incorporated by reference shall not be deemed to be filed as part of this Form 10-K.

21 

14.1	Financial Code of Ethical Conduct between the Company, Chief Executive Officers and Financial Managers, adopted December 3, 2014.
21.1	Subsidiaries of Registrant at September 30, 2016: Florida Rock Properties, Inc. (a Florida corporation); FRP Development Corp. (a Maryland corporation); FRP Maryland, Inc. (a Maryland corporation); 34 Loveton Center LLC (a Maryland limited liability company); ; Oz LLC(a Maryland limited liability company); 1502 Quarry, LLC(a Maryland limited liability company); FRP Lakeside LLC #1 (a Maryland limited company); FRP Lakeside LLC #2 (a Maryland limited liability company); FRP Lakeside LLC #3 (a Maryland limited liability company); FRP Lakeside LLC #4 (a Maryland limited liability company); FRP Lakeside LLC #5 (a Maryland limited liability company); FRP Hillside LLC (a Maryland limited liability company); FRP Hillside LLC #2 (a Maryland limited liability company); FRP Hillside LLC #3 (a Maryland limited liability company); FRP Hillside LLC #4 (a Maryland limited liability company); FRP Windsor LLC (a Maryland limited liability company); FRP Dorsey LLC (a Maryland limited liability company); FRP Bird River LLC (a Maryland limited liability company); FRP Interchange LLC (a Maryland limited liability company); FRP Azalea LLC (a Maryland limited liability company); FRP Manassas LLC (a Maryland limited liability company); FRP Hampstead LLC (a Maryland limited liability company); FRP Hollander 95 LLC (a Maryland limited liability company); FRP 10820 Gilroy Road LLC (a Maryland limited liability company); FRP Transit Business Park (a Maryland limited liability company); FRP Kelso LLC (a Maryland limited liability company); FRP Oregon Avenue LLC (a Maryland limited liability company); FRP Preston Court LLC (a Maryland limited liability company); FRP Port Capital LLC (a Maryland limited liability company); Brooksville Quarry, LLC (a Florida limited liability company, 50% owned by the Company); Lake Louisa, LLC (a Florida limited liability company); FRP Riverfront I, LLC (a Delaware limited liability company); Riverfront Investment Partners I, LLC (a Delaware limited liability company, 77.14% owned by the company); Hillside Business Park Property Owners Association, Inc. (a Maryland corporation); Lakeside Business Park Property Owners Association, Inc. (a Maryland limited liability company) FRP Riverfront I, LLC (a Delaware limited liability company).
23.1	Consent of Hancock Askew & Co., Inc., Independent Registered Certified Public Accounting Firm, appears on page 24 of this Form 10-K.
31.1	Certification of Thompson S. Baker II.
31.2	Certification of Thompson S. Baker II.
31.3	Certification of John D. Klopfenstein.
32.1	Certification of Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer under Section 906 of the Sarbanes-Oxley Act of 2002.
99.1	Information Statement of Patriot Transportation Holding, Inc., dated January 12, 2015, incorporated by reference to the Company’s Form 8-K filed on January 13, 2015.
101.INS	XBRL Instance Document
101.XSD	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

22 

FRP HOLDINGS, INC.

INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE

(Item 15(a) (1) and 2))

	Page
Consolidated Financial Statements:
Consolidated balance sheets at September 30, 2016
and 2015	20	(a)
For the years ended September 30, 2016, 2015 and 2014:
Consolidated statements of income	19	(a)
Consolidated statements of comprehensive income	19	(a)
Consolidated statements of cash flows	21	(a)
Consolidated statements of shareholders' equity	22	(a)
Notes to consolidated financial statements	23-33	(a)
Report of Independent Registered Certified Public
Accounting Firm	34-35	(a)
Selected quarterly financial data (unaudited)	7	(a)
Consent of Independent Registered Certified Public
Accounting Firm	24	(b)
Report of Independent Registered Certified Public
Accounting Firm on Financial Statement Schedule	24	(b)
Consolidated Financial Statement Schedule:
III - Real estate and accumulated depreciation and
Depletion	25-26	(b)
(a)         Refers to the page number in the Company's 2016 Annual Report to Shareholders.  Such information is incorporated by reference in Item 8 of this Form 10-K.
(b)         Refers to the page number in this Form 10-K
All other schedules have been omitted, as they are not required under the related instructions, are inapplicable, or because the information required is included in the consolidated financial statements.

23 

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-55132, 333-125099 and 333-131475) of FRP Holdings, Inc. of our report dated December 12, 2016 relating to the consolidated financial statements and the effectiveness of FRP Holdings, Inc’s internal control over financial reporting which appears in the Annual Report to Shareholders incorporated by reference herein. We also consent to the incorporation by reference of our report dated December 12, 2016, relating to the financial statement schedule, which appears in this Form 10-K.

Hancock Askew & Co., LLP

Savannah, Georgia

December 12, 2016

REPORT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM ON FINANCIAL STATEMENT SCHEDULE

The Shareholders and Board of Directors

FRP Holdings, Inc.:

Our audit of the consolidated financial statements referred to in our report dated December 12, 2016 appearing in the 2016 Annual Report to Shareholders of FRP Holdings, Inc. (which report and consolidated financial statements are incorporated by reference in this Annual Report on Form 10-K) also included an audit of the financial statement schedule listed in Item 15(a)(2) of this Form 10-K. This financial statement schedule is the responsibility of the Company’s management. Our responsibility is to express an opinion on the financial statement schedule based on our audit. In our opinion, the financial statement schedule presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements.

Hancock Askew & Co., LLP

Savannah, Georgia

December 12, 2016

24 

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED)-REAL ESTATE & ACCUMULATED DEPRECIATION AND

DEPLETION (dollars in thousands)

SEPTEMBER 30, 2016

County	Encumb- rances		Initial cost to Company		Cost capitalized subsequent to acquisition			Gross amount at which carried at end of period (a)		Accumulated Depreciation & Depletion		Year Of Constr- uction		Date Acquired		Depreciation Life Computed on:
Mining Royalty Lands
Alachua, FL			$	1,442	$	0		$	1,442	$	156		n/a		4/86	unit
Clayton, GA				369		0			369		5		n/a		4/86	unit
Fayette, GA				685		199			884		67		n/a		4/86	unit
Lake, FL				402		0			402		158		n/a		4/86	unit
Lake, FL				1,083		0			1,083		975		n/a		4/86	unit
Lake Louisa, FL				11,039		0			11,039		0		n/a		5/12	unit
Lee, FL				4,690		12			4,702		6		n/a		4/86	unit
Monroe, GA				792		0			792		288		n/a		4/86	unit
Muscogee, GA				369		(45	)		324		324		n/a		4/86	unit
Prince William, VA				298		0			298		298		n/a		4/86	unit
Putnam, FL				15,002		37			15,039		4,533		n/a		4/86	unit
Putnam, FL				302		(2	)		300		283		n/a		4/86	5 yr.
Spalding, GA				20		0			20		0		n/a		4/86	n/a
Marion, FL				1,180		4			1,184		599		n/a		4/86	unit
Investment Property				1,629		(101	)		1,528		691		n/a		4/86	n/a
		0		39,302		104			39,406		8,383
Asset Management Properties
Baltimore, MD		1,698		439		4,429			4,868		2,714		1990		10/89	39 yr.
Baltimore, MD		3,288		950		7,722			8,672		4,847		1994		12/91	39 yr.
Baltimore, MD		973		690		2,861			3,551		1,570		2000		07/99	39 yr.
Baltimore, MD		0		1,435		4,229			5,664		1,113		2008		12/02	39 yr.
Baltimore, MD		0		4,309		276			4,585		273		n/a		06/15	39 yr.
Baltimore, MD		0		8,412		521			8,933		54		1967		07/16	39 yr.
Baltimore City, MD		4,712		5,106		5,488			10,594		1,108		2016		12/10	39 yr.
Baltimore City, MD		0		7,442		1,869			9,311		1,070		n/a		6/13	39 yr.
Duval, FL		0		2,416		541			2,957		2,793		n/a		4/86	25 yr.
Harford, MD		486		31		3,830			3,861		2,181		1998		8/95	39 yr.
Harford, MD		1,377		50		5,709			5,759		2,605		1999		8/95	39 yr.
Harford, MD		2,646		85		7,091			7,176		3,677		2001		8/95	39 yr.
Harford, MD		2,148		88		10,133			10,221		4,379		2007		8/95	39 yr.
Harford, MD		1,506		155		12,627			12,782		4,401		2009		8/95	39 yr.
Howard, MD		0		2,859		4,887			7,746		4,369		1996		9/88	39 yr.
Howard, MD		879		2,473		1,046			3,519		1,480		2000		3/00	39 yr.
Elkridge, MD		0		8,920		27			8,947		355		TBD		10/15	39 yr.
Anne Arundel, MD		8,179		715		9,394			10,109		5,893		1989		9/88	39 yr.
Anne Arundel, MD		4,730		950		14,211			15,161		5,184		2003		5/98	39 yr.
Anne Arundel, MD		0		1,525		10,800			12,325		3,737		2005		8/04	39 yr.
Anne Arundel, MD		3,390		737		5,430			6,167		1,900		2006		1/03	39 yr.
Anne Arundel, MD		0		667		10,641			11,308		2,832		2012		7/07	39 yr.
Norfolk, VA		0		7,512		36			7,548		2,668		2004		10/04	39 yr.
Prince William, VA		0		7,039		24,078			31,117		2,582		2014		12/05	39 yr.
Newcastle Co., DE		0		11,559		2,959			14,518		4,736		2004		4/04	39 yr.
		36,012		76,564		150,835			227,399		68,521
Land Development and Construction Properties
Baltimore City, MD		0		988		3,826			4,814		106		n/a		12/10	15 yr.
Carroll, MD		0		4,720		2,340			7,060		0		n/a		3/08	n/a
Harford, MD		0		92		1,600			1,692		0		n/a		8/95	n/a
Prince William, VA		0		3,402		4,670			8,072		97		n/a		12/05	15 yr.
Washington D.C.		0		2,957		9,858			12,815		2,866		n/a		4/86	15 yr.
Washington D.C.		0		3,811		2,404			6,215		0		n/a		10/97	n/a
		0		15,970		24,698			40,668		3,069
GRAND TOTALS	$	36,012	$	131,836	$	175,637		$	307,473	$	79,973

(a) The aggregate cost for Federal income tax purposes is $269,546.

25 

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED) - REAL ESTATE AND

ACCUMULATED DEPRECIATION AND DEPLETION

YEARS ENDED SEPTEMBER 30, 2016, 2015 AND 2014

(In thousands)

		2016			2015			2014
Gross Carrying Cost of Real Estate:
Balance at beginning of period	$	292,528		$	286,671		$	268,932
Additions during period:
Amounts capitalized		27,439			6,063			19,154
Deductions during period:
Cost of real estate sold		(5,011	)		—			(1,415	)
Other		(7,483	) (1)		(206	)		—
Balance at close of period	$	307,473		$	292,528		$	286,671
Accumulated Depreciation & Depletion:
Balance at beginning of period	$	73,480		$	67,598		$	62,167
Additions during period:
Charged to cost & expense		6,690			5,902			5,446
Deductions during period:
Real estate sold		—			—			(15	)
Other		(197	)		(20	)		—
Balance at close of period	$	79,973		$	73,480		$	67,598

(1) Includes $6,828 of property cost transferred to Investment in Joint Ventures for the joint venture partnership with St. John Properties.

26 

EX-13

Annual Report 2016

CONSOLIDATED FINANCIAL HIGHLIGHTS

Years ended September 30

(Amounts in thousands except per share amounts)

		2016	2015	% Change
Revenues	$	37,457	34,646	8.1
Operating profit	$	16,383	12,181	34.5
Income from continuing operations	$	12,024	6,093	97.3
Discontinued operations, net	$	—	2,179	(100.0	)
Net income	$	12,024	8,272	45.4
Per common share:
Income from continuing operations:
Basic	$	1.22	.62	.97
Diluted	$	1.22	.62	.97
Discontinued operations:
Basic	$	—	.23	(100.0	)
Diluted	$	—	.22	(100.0	)
Net income:
Basic	$	1.22	.85	.44
Diluted	$	1.22	.84	.45
Total Assets	$	265,676	252,621	5.2
Total Debt	$	42,819	48,685	(12.0	)
Shareholders' Equity	$	196,099	182,342	7.5
Common Shares Outstanding		9,867	9,792	.8
Book Value Per Common Share	$	19.87	18.62	6.7

BUSINESS. FRP Holdings, Inc. is a holding company engaged in the real estate business, namely (i) warehouse/office building ownership, leasing and management, (ii) mining royalty land ownership, leasing and management and (iii) land acquisition, entitlement, development and construction primarily for warehouse/office buildings. The Company’s operating subsidiaries are FRP Development Corp. and Florida Rock Properties, Inc.

OBJECTIVES. The Company’s objectives are to continue building a substantial real estate company providing sound long-term growth, cash generation and asset appreciation.

GROWTH PLAN. The growth plan is based on the orderly conversion of our non-income producing lands into income producing properties and the acquisition, development and management of mining royalty lands and commercial warehouse/office rental properties located in appropriate sub-markets in order to provide long-term positive cash flows and capital appreciation.

1 

To Our Shareholders,

As one looks at our fiscal 2016 results, there is much to be pleased with. Revenues are up $2,811,000 (8.11%) over fiscal 2015 and income from continuing operations for fiscal 2016 was $12,024,000 or $1.22 per share versus $6,093,000 or $.62 per share last year. Our real estate team in Baltimore continues to create shareholder value by converting non-income producing properties into income producing square feet, RiverFront on the Anacostia is ahead of schedule, and the mining royalties segment had its highest revenue year since 2008.

Asset Management

For fiscal 2016 in the Asset Management Segment, Net Operating Income (NOI), management’s chosen metric for measuring shareholder value creation in that segment, grew 4.3% to $21,944,000. The increase was due mainly to completion of Patriot Business Center’s third build-to-suit in November of 2014, the acquisition of the Port Capital building in October of 2015 and the acquisition of the Gilroy Road building in July of 2016.

These results are reflective of our goal to create shareholder value by growing earnings and converting non-income producing properties into income producing square feet.

As we begin 2017, we have an unusually high number of tenants with expiring leases as a result of several five year leases signed in the aftermath of the last recession. However, we have every confidence in our Baltimore-based team’s ability to deliver on their past performance and continue to grow shareholder value through our stated goal of turning non-income producing properties into income producing square feet. The combination of weathering these lease expirations, maintaining same store NOI, and growing our earnings by leveraging our Land Development and Construction Segment will translate into meaningful shareholder value, particularly in this cap rate environment.

Mining Royalty

Due to an increase in tons sold at higher prices, total revenues in this segment increased 23.6% over last year for a total of $7,533,000. This represents this segment’s highest revenue number since 2008. Total operating profit in this segment was $6,798,000, an increase of $2,642,000 (including a $1,091,000 benefit from reallocating expenses), versus $4,156,000 last year. This marks the sixth year in a row that revenues have increased in this segment, and is reflective of the economic recovery that the markets served by our properties, particularly in Florida, have experienced since the depths of the downturn.

Our management continues to believe we are still in the early innings of recovery in aggregate shipments. Home building lags replacement rates and there is consensus on both sides of the political aisle that our nation’s infrastructure requires a major overhaul. Any infrastructure spending, particularly of the magnitude promised in the lead up to the election, would be a boon to construction materials businesses and to this segment. Our investment in our mining royalty lands segment represent a “long” bet on the Virginia, Georgia, and Florida markets served by our properties. Both the mining leases and the potential “second lives” of these properties reflect our confidence in the long term future growth in this segment.

Land Development and Construction

This segment is the foundation for all our future growth. Our overall strategy in this segment is to convert all of our non-income producing lands into income production. Whether through the orderly development of our existing properties to own and operate, joint ventures, and/or selling land to acquire developed assets, this segment is how we leverage and convert potential shareholder value into actual income.

Consistent with our strategy, we completed construction on a 79,550 square foot spec building at Hollander Business Park that was put into service in the third quarter of fiscal 2016; started construction on a 103,653 square foot building in Patriot Business Center and pre-leased 51,727 square feet; and finally in April 2016, we entered into a joint venture agreement to develop 12 office buildings on our remaining lots at Windlass Run and on adjacent frontage property owned by St. John Properties.

2 

The remaining pad sites in our inventory today are fully entitled, located in business parks in four different submarkets in the DC/Baltimore/Northern Virginia area, and can support an additional +/- 1 million sf. of warehouse/office buildings. Beyond our potential commercial sites, we have two interesting pieces of property in Square 664E and the former Hampstead Trade Center.

Square 664E, our two acres on the Anacostia River at the base of South Capitol Street in an area named Buzzard Point, is approximately one mile down river from our RiverFront on the Anacostia property. As the development of DC’s new soccer stadium continues in the Buzzard Point area, our adjacent property may become our next RiverFront.

Though Hampstead was originally purchased as a commercial business park, management determined that the best use for the property was residential, and we have sought to rezone the property for that use in order to sell it and redeploy this capital into assets with more near-term income producing potential. In the fourth quarter of fiscal 2016, the Company received approval from the Town of Hampstead and has rezoned the property for residential use.

We will continue to monitor all our sites and their markets, and remain opportunistic regarding their best use.

RiverFront on the Anacostia

Management is more than pleased with the progress and continued success of RiverFront on the Anacostia. We completed construction on Phase I this past October and already have people in the building. As of October 31, residentially the building is 30.5% occupied and 42.3% leased, while commercially we have leased 80% of our retail spaces, with just one space remaining. As we continue to trend above pro forma for pace and rents, the results speak clearly that we have an excellent partner in MRP. Looking forward, the company and MRP Realty executed a letter of intent in May 2016 to develop Phase II. In accordance with our Master Planned Unit Development (PUD) approval, Phase II plans were submitted to the Zoning Commission for final design approval on June 27, 2016.

The results of Fiscal 2016 speak to the excellent work of our management team. Looking forward to 2017, we expect the Asset Management Segment to rise to the challenge presented by the high number of expiring leases, while continuing to put our land bank to work in creating value for our shareholders. We have every expectation that our mining royalties segment should continue to grow and grow meaningfully. RiverFront on the Anacostia continues to impress, as Phase I comes on line and ahead of schedule and Phase II moves forward.

In conclusion, we thank you not only for your continued interest and support, but also for the faith in management your investment demonstrates. This is your company and we neither take your investment in it lightly nor for granted.

Respectfully yours,

John D. Baker II

Executive Chairman

Thompson S. Baker II

Chief Executive Officer

3 

OPERATING PROPERTIES

The Company owns (predominately in fee simple but also through ownership of interests in joint ventures) over 20,000 acres of land in Florida, Georgia, Maryland, Virginia, Delaware, and the District of Columbia. This land is generally held by the Company in three distinct categories (i) land owned and leased to mining companies for royalties or rents, (ii) land owned and operated as income producing rental properties predominately in the form of warehouse/office buildings, and (iii) land owned and held for investment to be further developed for future income production or sales to third parties.

Mining Royalty Lands Segment – Mining Properties. The following table summarizes the Company's mining royalty lands and estimated reserves at September 30, 2016 a substantial portion of which are leased to Vulcan Materials.

		Tons of
	Tons Sold	Estimated
	in Year	Reserves
	Ended	at
	9/30/16	9/30/16	Approximate
	(000's)	(000's)	Acres Owned
The Company owns nine
locations currently being
mined in Grandin, Keuka,
Newberry, Astatula and Airgrove, Florida;
Columbus, Macon, and Tyrone, Georgia;
and Manassas, Virginia.	6,538	321,916	11,328
The Company owns four locations that are
leased for mining but are not currently being
mined in Ft. Myers (Lee County), Marion
County and Lake County, Florida and
and Forest Park, Georgia.	0	87,827	3,867

This table excludes the Brooksville, Florida property, approximately 4,280 acres, as it was transferred on October 4, 2006 to a joint venture with Vulcan Materials Company (“Vulcan Materials”) for future development.

In May, 2014 the Company entered into an amendment to our lease agreement for our Ft. Myers location requiring that the mining be accelerated and that the mining plan be conformed to accommodate the future construction of up to 105 residential dwelling units around the mined lakes. In return, the Company agreed to sell Lee County a right of way for a connector road that would benefit the residential area on our property and to place a conservation easement on part of the property. Based on information from our tenant, Vulcan Materials Company, the Company is hopeful that all necessary permits to commence mining on this property will be received during fiscal 2017.

During fiscal 2015, the Company also received positive information from Vulcan Materials with respect to two other locations. With regard to our Manassas, Virginia location, Vulcan Materials informed us that they recently removed a concrete plant off property owned by the Company which opened up an additional 25 million tons of material to be mined from Company property. Vulcan Materials’ current lease term at the Manassas location expires on May 31, 2020 and they have one additional ten year extension option available. At our Astatula location, Vulcan Materials began mining on Company property during fiscal 2015 and plans are to continue that mining for the foreseeable future at volumes commensurate with, or in excess of, those achieved in fiscal 2015.

Mining Royalty Lands Segment - Brooksville Joint Venture. On October 4, 2006, a subsidiary of the Company (Florida Rock Properties, Inc.) entered into a Joint Venture Agreement with Florida Rock Industries, Inc. (which was acquired by Vulcan Materials in 2007) to form Brooksville Quarry, LLC, a real estate joint venture, to develop approximately 4,280 acres of land near Brooksville, Florida as a mixed-use community. In April 2011, the Florida Department of Community Affairs issued its Final Order approving the development of the Project consisting of 5,800 residential dwelling units and over 600,000 square feet of commercial and 850,000 of light industrial uses. The Master

4 

Plan zoning for the Project was approved by the County in August 2012. Vulcan Materials still mines on the property and the Company receives 100% of the royalty on all tons sold at the Brooksville location. In fiscal 2016, 404,000 tons were sold and estimated reserves were 5,698,000 as of September 30, 2016. During fiscal 2015, the Company agreed to extend the mining lease on this property for an additional four years, through the year 2022, in exchange for an immediate increase in the annual minimum royalty and a higher royalty rate on tons sold and mined from the property.

Mining Royalty Lands Segment - Other Properties. The segment also owns an additional 1,923 acres of investment properties in Gulf Hammock (approximately 1,600 acres currently on the market for $4.5 million), Brooksville, Palatka, and Polk County, Florida and Yatesville and Henderson, Georgia.

Asset Management Segment. As of September 30, 2016, the Asset Management Segment owned 42 warehouse/office buildings, totaling 3,880,365 square feet, all of which (with the exception of one building) are in the Mid-Atlantic region of the United States as follows:

1) Hillside Business Park in Anne Arundel County, Maryland consists of four warehouse/office buildings and one suburban office building totaling 567,473 square feet.

2) Lakeside Business Park in Harford County, Maryland consists of nine warehouse/office buildings totaling 893,722 square feet.

3) 6920 Tudsbury Road in Baltimore County, Maryland consists of one warehouse/office building totaling 86,100 square feet.

4) 8620 Dorsey Run Road in Howard County, Maryland consists of one warehouse/office building totaling 85,100 square feet.

5) Rossville Business Center in Baltimore County, Maryland consists of two warehouse/office buildings totaling 190,517 square feet.

6) 34 Loveton Circle in suburban Baltimore County, Maryland consists of one office building totaling 33,708 square feet (24% of the space is occupied by the Company for use as our Baltimore headquarters).

7) Oregon Business Center in Anne Arundel County, Maryland consists of two warehouse/office buildings totaling 195,615 square feet.

8) Arundel Business Center in Howard County, Maryland consists of two warehouse/office buildings totaling 162,796 square feet.

9) 100-200 Interchange Boulevard in New Castle County, Delaware consists of two warehouse/office buildings totaling 303,006 square feet.

10) Windlass Run Business Park in Baltimore County, Maryland consists of one warehouse/office building totaling 69,474 square feet.

11) 155 E. 21^st Street in Duval County, Florida consists of one office building totaling 68,757 square feet.

12) Hollander 95 Business Park in Baltimore City, Maryland consists of two warehouse/office building totaling 162,350 square feet.

13) Patriot Business Park in Prince William County, Virginia consists of three warehouse/office buildings totaling 373,000 square feet.

14) Transit Business Park in Baltimore, Maryland consists of five buildings totaling 232,318 square feet.

15) Kelso Business Park in Baltimore County, Maryland, consists of two warehouse/office buildings totaling 69,680

5 

square feet.

16) 1187 Azalea Garden Road in Norfolk, VA consists of one warehouse totaling 188,093 square feet.

17) 10820 Gilroy Road in Baltimore County, Maryland, consists of one warehouse/office building totaling 107,438 square feet.

18) 7700 Port Capital Drive in Howard County, Maryland consists of one warehouse/office building totaling 91,218 square feet.

Land Development and Construction Segment – Warehouse/Office Land.

At September 30, 2016 this segment owned the following future development parcels:

1) 20 acres of horizontally developed land available for future construction of an additional 286,500 square feet of warehouse/office product at Lakeside Business Park in Harford County, Maryland.

2) 17.5 acres of horizontally developed land available for future construction of 164,500 square feet of office buildings representing our 50% interest in a joint venture at Windlass Run Business Park in Baltimore County, Maryland.

3) 25 acres of horizontally developed land available for future construction of 202,653 square feet of warehouse/office product at Patriot Business Park in Prince William County, Virginia.

4) 33 acres of horizontally developed land available for future construction of 319,950 square feet of warehouse, office, hotel and flex buildings at Hollander 95 Business Park in Baltimore City, Maryland.

Land Development and Construction Segment – Land Held for Investment or Sale.

1) The Windlass Run Residential (previously Bird River) Phase 2 property consists of 74 useable acres located in southeastern Baltimore County, Maryland, adjacent to our Windlass Run Business Park. The Company rezoned the property in September 2007 to allow for additional residential density. The Company executed two contracts on April 17, 2013 for the sale of phase 1 of the property in the quarter ending September 30, 2013 for $8.0 million and the balance for $11.0 million approximately 18 months later. The sale of phase 1 was completed in August of 2013 and resulted in a gain of $4,928,000. The sale of phase two was originally scheduled to close in March of 2015 but was extended by the Buyer on March 20, 2015 with payment of an $187,754 extension fee to allow closing on or before September 30, 2015. Closing occurred on October 30, 2015.

2) The RiverFront on the Anacostia property is a 5.8 acre parcel of real estate in Washington D.C. that fronts the Anacostia River and is adjacent to the Washington Nationals Baseball Park. The approved planned unit development permits the Company to develop a four building, mixed use project, containing approximately 545,800 square feet of office and retail uses and approximately 569,600 square feet of residential and hotel uses. The approved development would include numerous publicly accessible open spaces and a waterfront esplanade along the Anacostia River.

On March 30, 2012 the Company entered into a Contribution Agreement with MRP SE Waterfront Residential, LLC. (“MRP”) to form a joint venture to develop the first phase only of the four phase master development known as RiverFront on the Anacostia in Washington, D.C. The purpose of the Joint Venture is to develop, own, lease and ultimately sell a 305 unit residential apartment building (including approximately 18,000 square feet of retail) on approximately 2 acres of the site. The joint venture, RiverFront Investment Partners I, LLC (“RiverFront I”) was formed in June 2013 as contemplated. The Company contributed land with an agreed to value of $13,500,000 (cost basis of $6,165,000) and contributed cash of $4,866,000 to the Joint Venture for a 76.91% stake in the venture. MRP contributed capital of $5,553,000 to the joint venture including development costs paid prior to formation of the joint venture. The Joint Venture closed on $17,000,000 of EB5 secondary financing and a nonrecourse construction loan for $65,000,000 on August 8, 2014. Both of these financings are non-recourse to

6 

the Company. Construction commenced in October 2014 and occupancy started in August 2016. The Company’s equity interest in the joint venture is accounted for under the equity method of accounting as MRP acts as the administrative agent of the joint venture and oversees and controls the day to day operations of the project.

On August 24, 2015, in anticipation of commencing construction of the new Frederick Douglass bridge at a location immediately to the West of the existing bridge, the District of Columbia filed a Declaration of Taking for a total of 7,390 square feet of permanent easement and a 5,022 square foot temporary construction easement on land along the western boundary of the land that will ultimately hold Phase III and IV. Previously, the Company and the District had conceptually agreed to a land swap with no compensation that would have permitted the proposed new bridge, including construction easements, to be on property wholly owned by the District. As a result, the Planned Unit Development was designed and ultimately approved by the Zoning Commission as if the land swap would occur once the District was ready to move forward with the new bridge construction. In September 2016 the Company received $1,115,400 as settlement for the easement. The Company will continue to seek an agreement from the District that the existing bridge easement will terminate when the new bridge has been placed in service and the existing bridge has been removed. The Company’s position is that otherwise Phase IV will be adversely impacted and additional compensation or other relief will be due the Company.

3) The Hampstead Trade Center property in Hampstead, Carroll County, Maryland is a 117 acre parcel located adjacent to the State Route 30 bypass. The parcel was previously zoned for industrial use. In the fourth quarter of fiscal 2016, the Company received approval from the Town of Hampstead and has rezoned the property for residential use. Management believes this to be a higher and best use of the property.

4) The Square 664E property is approximately 2 acres and sits on the Anacostia River at the base of South Capitol Street approximately 1 mile down river from our RiverFront on the Anacostia property. This property is currently under lease to Vulcan Materials for use as a concrete batch plant. The lease terminates on August 31, 2021 and Vulcan has the option to renew for one additional period of five (5) years. In the quarter ending December 31, 2014, the District of Columbia announced that it had selected an approximate 5 acre site adjacent to this property for the future construction of the new DC United major league soccer stadium. Construction is underway to completely rebuild the existing bulkhead in anticipation of future high rise development on this property.

7 

Real Estate Summary Schedule at September 30, 2016 (dollars in thousands).

		Encumb-		Gross		Net	Date		Revenue
County		Rances		Book Cost		Book Value	Acquired		Fiscal 2016
Mining Royalty Lands
Alachua, FL			$	1,442	$	1,286	4/86	$	985
Clayton, GA				369		364	4/86		92
Fayette, GA				884		817	4/86		666
Lake, FL				402		244	4/86		370
Lake, FL				1,083		108	4/86		290
Lake Louisa, FL				11,039		11,039	5/12		849
Lee, FL				4,702		4,696	4/86		355
Monroe, GA				792		504	4/86		782
Muscogee, GA				324		0	4/86		362
Prince William, VA				298		0	4/86		635
Putnam, FL				15,039		10,506	4/86		1,621
Putnam, FL				300		17	4/86		0
Spalding, GA				20		20	4/86		5
Marion, FL				1,184		585	4/86		146
Investment Property				1,528		837	4/86		26
Brooksville Joint Venture				7,496		7,496	4/86		349
		0		46,902		38,519			7,533
Asset Management Properties
Baltimore, MD		1,698		5,803		2,445	10/89		466
Baltimore, MD		3,288		8,672		3,825	12/91		1,371
Baltimore, MD		973		3,551		1,981	7/99		538
Baltimore, MD		0		5,664		4,551	12/02		567
Baltimore, MD		0		4,585		4,312	6/15		749
Baltimore, MD		0		8,933		8,879	7/16		239
Baltimore City, MD		4,712		10,594		9,486	12/10		607
Baltimore City, MD		0		9,311		8,241	6/13		1,280
Duval, FL		0		2,957		164	4/86		730
Harford, MD		486		3,861		1,680	8/95		788
Harford, MD		1,377		5,759		3,154	8/95		1,270
Harford, MD		2,646		7,176		3,499	8/95		1,403
Harford, MD		2,148		10,221		5,842	8/95		1,832
Harford, MD		1,506		12,782		8,381	8/95		1,301
Howard, MD		0		7,746		3,377	9/88		1,223
Howard, MD		879		3,519		2,039	3/00		483
Elkridge, MD		0		8,947		8,592	10/15		645
Anne Arundel, MD		8,179		10,109		4,216	9/88		1,241
Anne Arundel, MD		4,730		15,161		9,977	5/98		1,604
Anne Arundel, MD		0		12,325		8,588	8/04		1,911
Anne Arundel, MD		3,390		6,167		4,267	1/03		734
Anne Arundel, MD		0		11,308		8,476	7/07		1,392
Norfolk, VA		0		7,548		4,880	10/04		842
Prince William, VA		0		31,117		28,535	12/05		4,240
Newcastle Co., DE		0		14,518		9,782	4/04		1,283
		36,012		228,334		159,169			28,739
Land Development and Construction Properties
Baltimore, MD		0		5,097		5,097	12/02		0
Baltimore City, MD		0		4,814		4,708	12/10		46
Carroll, MD		0		7,060		7,060	3/08		0
Harford, MD		0		1,692		1,692	8/95		0
Prince William, VA		0		8,072		7,975	12/05		0
Washington D.C.		0		12,815		9,949	4/86		151
Washington D.C.		0		6,215		6,215	10/97		988
RiverFront joint venture		0		11,261		11,261	04/13		0
		0		57,026		53,957			1,185
Grand Totals	$	36,012	$	332,262	$	251,645		$	37,457

8 

Five Year Summary-Years ended September 30

(Amounts in thousands except per share amounts)

		2016	2015	2014	2013	2012
Summary of Operations:
Revenues	$	37,457	34,646	30,978	27,654	24,038
Operating profit	$	16,383	12,181	9,740	9,315	4,994
Interest expense	$	1,561	2,014	1,366	2,501	2,611
Income from continuing operations	$	12,024	6,093	5,184	8,614	2,173
Per Common Share:
Basic	$	1.22	.62	.54	.90	.23
Diluted	$	1.22	.62	.53	.90	.23
Discontinued
Operations, net	$	—	2,179	4,835	6,771	5,635
Net income	$	12,024	8,272	10,019	15,385	7,808
Per Common Share:
Basic	$	1.22	.85	1.04	1.62	.83
Diluted	$	1.22	.84	1.03	1.60	.82
Financial Summary:
Property and
equipment, net	$	220,616	207,205	207,436	202,511	196,635
Total assets	$	265,676	252,621	313,071	287,093	275,705
Long-term debt	$	42,819	44,505	51,422	45,593	57,131
Shareholders' equity	$	196,099	182,342	206,315	192,646	174,718
Net Book Value
Per common share	$	19.87	18.62	21.26	20.14	18.51
Other Data:
Weighted average common
shares – basic		9,846	9,756	9,629	9,523	9,360
Weighted average common
shares – diluted		9,890	9,827	9,710	9,605	9,474
Number of employees		18	18	957	886	828
Shareholders of record		414	423	469	497	505

Quarterly Results (unaudited)

(Dollars in thousands except per share amounts)

		First		Second		Third		Fourth
		2016	2015	2016	2015	2016	2015	2016	2015
Revenues	$	8,823	8,302	9,615	8,948	9,243	8,497	9,776	8,899
Operating profit	$	6,600	2,345	3,509	2,159	1,966	3,889	4,308	3,788
Income from continuing operations	$	7,473	1,131	1,820	845	774	2,046	1,957	2,071
Discontinued operations, net	$	—	1,663	—	516	—	—	—	—
Net income	$	7,473	2,794	1,820	1,361	774	2,046	1,957	2,071
Earnings per common share (a):
Income from continuing operations-
Basic	$	.76	.12	.18	.09	.08	.21	.20	.21
Diluted	$	.76	.12	.18	.09	.08	.21	.20	.21
Discontinued operations-
Basic	$	.00	.17	.00	.05	.00	.00	.00	.00
Diluted	$	.00	.17	.00	.05	.00	.00	.00	.00
Net income-
Basic	$	.76	.29	.18	.14	.08	.21	.20	.21
Diluted	$	.76	.29	.18	.14	.08	.21	.20	.21
Market price per common share (b):
High	$	35.25	42.36	36.00	36.40	38.11	37.39	36.79	33.62
Low	$	29.00	33.75	28.65	29.39	29.95	29.42	30.92	28.51

9 

(a) Earnings per share of common stock is computed independently for each quarter presented. The sum of the quarterly net earnings per share of common stock for a year may not equal the total for the year due to rounding differences.

(b) All prices represent high and low daily closing prices as reported by The Nasdaq Stock Market.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion includes certain non-GAAP financial measures (“adjusted”) within the meaning of Regulation G promulgated by the Securities and Exchange Commission (“Regulation G”) to supplement the financial results as reported in accordance with GAAP. Post Spin-off we are reporting any net gain/(loss) from the transportation business as “discontinued operations” and we currently have no other discontinued operations being reported. GAAP accounting rules do not allow corporate overhead expenses to be allocated to a discontinued operation of the Company; thus, those corporate expenses attributable to the transportation business prior to the spin-off are charged to the Company as part of continuing operations. The non-GAAP financial measures discussed below are adjusted income from continuing operations and adjusted consolidated operating profit. These non-GAAP financial measures exclude the corporate management fees attributable to the transportation business prior to the spin-off that are not allocable to the transportation business due to it being a discontinued operation. The Company uses these metrics to analyze its continuing operations and to monitor, assess, and identify meaningful trends in its operating and financial performance. These measures are not, and should not be viewed as, substitutes for GAAP financial measures. Refer to “Non-GAAP Financial Measures” below in this annual report for a more detailed discussion, including reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures.

Executive Overview

FRP Holdings, Inc. (“FRP” or the “Company”) is a holding company engaged in the real estate business, namely (i) warehouse/office building ownership, leasing and management, (ii) mining royalty land ownership, leasing and management, and (iii) land acquisition, entitlement, development and construction mainly for warehouse/office buildings.

On January 30, 2015, FRP completed the tax-free spin-off of its transportation business (“Spin-off”) into a new, separately traded public company, Patriot Transportation Holding, Inc. (“Patriot”). In the Spin-off, FRP distributed all of the outstanding stock of Patriot to FRP’s shareholders as of the record date of January 9, 2015. FRP’s shareholders received one share of Patriot common stock for every three shares of FRP common stock owned on the record date. Patriot is now an independent publicly-traded company, and FRP retains no ownership in Patriot. FRP retained the real estate business, which is now the sole business of the Company. As a result, the former transportation segment is reported as a discontinued operation without any corporate overhead allocation. Hence, all corporate overhead attributable to the transportation group through the date of the spin-off is included in “corporate expense” on the Company’s historical consolidated income statements.

Following the completion of the spin-off of the transportation business, management conducted a strategic review of the Company’s real estate operations.  As a result of this review, Management determined that the information that the Company’s chief operating decision makers regularly review for purposes of allocating resources and assessing performance, had changed. Therefore, beginning with the quarter ending March 31, 2015 (with prior periods adjusted accordingly), the Company is reporting its financial performance based on three reportable segments, Asset Management, Mining Royalty Lands and Land Development and Construction, as described below.

Our Mining and Royalties segment remains unaffected, but our former Developed Property Rentals segment has been broken down into an Asset Management segment and a Land Development and Construction segment to reflect how management now evaluates the real estate activities previously presented in the Developed Property Rentals segment. The

10 

Asset Management segment contains all the developed buildings capable of producing current rental income. The Land Development and Construction segment contains the remaining developable land that is generally in a pre-income production state where objectives are long term capital investment in an effort to bring such property to income producing status or realization of its fair market value through sales or exchange.

Prior to the quarter ending December 31, 2015 certain corporate expenses (primarily stock compensation, corporate aircraft and one-time Spin-off related expenses) were reported as “unallocated” on the Company’s consolidated income statement and were not allocated to any business segment. Effective with fiscal 2016 all corporate expenses, other than those not allocated to discontinued operations, have been allocated. Reclassifications to the appropriate prior period line items and amounts have been made to be comparable to the current presentation. See Note 11 for a breakdown of corporate expenses showing the amounts allocated to the segments and the amounts unallocated to discontinued operations.

The Company’s operations are influenced by a number of external and internal factors. External factors include levels of economic and industrial activity in the United States and the Southeast, construction activity and costs, aggregates sales by lessees from the Company’s mining properties, interest rates, market conditions in the Baltimore/Northern Virginia/Washington DC area, and our ability to obtain zoning and entitlements necessary for property development. Internal factors include administrative costs and group health claims experience.

Highlights of Fiscal 2016.

• For fiscal 2016 in the Asset Management Segment, net operating income, management’s chosen metric for measuring shareholder value creation in that segment, grew 4.3% to $21,944,000.
• Revenues for the Mining Royalty Lands segment were up 23.6% as we saw several of our locations improve on volumes during fiscal 2016.
• Adjusted operating profit improved to $15,383,000, a 16% increase over fiscal 2015.

Asset Management Segment.

The Asset Management segment owns, leases and manages warehouse/office buildings located predominately in the Baltimore/Northern Virginia/Washington, DC market area.  We focus primarily on owning flexible type facilities that cater to the maximum number of tenant types. As most of our buildings are less than 150,000 square feet, we focus on local and regional vs. national tenants. Hands-on service provided by our in-house construction and property management teams keeps us close to our tenant base. These practices are the cornerstone of our mission to provide the highest quality product and services at competitive rates resulting in tenant satisfaction and ultimately, retention.

These assets create revenue and cash flows through tenant rental payments, lease management fees and reimbursements for building operating costs. The major cash outlays incurred in this segment are for operating expenses, real estate taxes, building repairs, lease commissions and other lease closing costs, construction of tenant improvements, capital to acquire existing operating buildings and closing costs related thereto and personnel costs of our property management team. Of the 42 buildings we own today, 27 were constructed by the Company through what is now known as our Land Development and Construction segment. Additionally, over the years, we have opportunistically acquired 15 existing operating buildings, typically in connection with a deferred like-kind (Section 1031) exchange opportunity.  Today, this segment consists of 3.9 million square feet.

The following table shows the total developed square footage and occupancy rates of our flex office/warehouse and office parks at September 30, 2016:

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		Total
Development	Location	Sq. feet	% Occupied
Hillside	Anne Arundel Co., MD	567,473	86.3	%
Lakeside	Harford Co., MD	893,722	89.6	%
Tudsbury	Baltimore Co., MD	86,100	100.0	%
Dorsey Run	Howard Co., MD	85,100	100.0	%
Rossville	Baltimore Co., MD	190,517	100.0	%
Loveton	Baltimore Co., MD	33,708	81.4	%
Oregon	Anne Arundel Co., MD	195,615	88.7	%
Arundel	Howard Co., MD	162,796	89.6	%
Interchange	New Castle Co., DE	303,006	82.0	%
Azalea Garden	Norfolk, VA	188,093	100.0	%
Windlass Run	Baltimore Co., MD	69,474	100.0	%
21st Street	Duval Co., FL	68,757	100.0	%
Hollander 95	Baltimore Co., MD	162,350	51.0	%
Patriot Business Park	Prince William Co., VA	373,000	100.0	%
Transit Business Park	Baltimore Co., MD	232,318	81.0	%
Kelso Business Park	Baltimore Co., MD	69,680	100.0	%
Port Capital Drive	Howard Co., MC	91,218	100.0	%
Gilroy Road	Baltimore Co., MD	107,438	100.0	%
		3,880,365	89.9	%

Management focuses on several factors to measure our success on a comparative basis in this segment. The major factors we focus on are (1) revenue growth, (2) net operating income, (3) growth in occupied square feet, (4) actual occupancy rate, (5) average annual occupied square feet, (6) average annual occupancy rate (defined as the occupied sf at the end of each month during a fiscal year divided by the number of months to date in that fiscal year as a percentage of the average number of square feet in the portfolio over that same time period), (7) growth of our portfolio (in square feet), and (8) tenant retention success rate (as a percentage of total square feet to be renewed).

Asset Management segment – fiscal year ended	September 30, 2016	September 30, 2015
Revenues	$28,739,000	$27,570,000
Net Operating Income (Cash Basis)	$21,944,000	$21,043,000
Occupied square feet	3,486,681	3,262,965
Overall occupancy rate	89.9%	90.6%
Average annual occupied sf	3,378,300	3,261,879
Average annual occupancy rate	89.8%	90.8%
Portfolio square feet	3,880,365	3,602,159
Retention Success rate	65%	83%

Mining Royalty Lands Segment.

Our Mining Royalty Lands segment owns several properties comprising approximately 15,000 acres currently under lease for mining rents or royalties (this does not include the 4,280 acres owned in our Brooksville joint venture with Vulcan Materials).  Other than one location in Virginia, all of these properties are located in Florida and Georgia.  The typical lease in this segment requires the tenant to pay us a royalty based on the number of tons of mined materials sold from our property during a given fiscal year multiplied by a percentage of the average annual sales price per ton sold. As a result of this royalty payment structure, we do not bear the cost risks associated with the mining operations, however, we are subject to the cyclical nature of the construction markets in these States as both volumes and prices tend to fluctuate through those cycles. In certain locations, typically where the reserves on our property have been depleted but the tenant still has a need for the leased land, we collect a fixed annual rental amount. We believe strongly in the potential for future growth in construction in Florida, Georgia, and Virginia which would positively benefit our profitability in this segment.  Our mining properties had estimated remaining reserves of 415 million tons as of September 30, 2016 after a total of 6.9 million tons were consumed in fiscal 2016.

The major expenses in this segment are comprised of collection and accounting for royalties, management’s oversight of the mining leases, land entitlement for post-mining uses and property taxes at our non-leased locations and at our Grandin location which, unlike our other leased mining locations, are not paid by the tenant.  As such, our costs in this business are very low as a percentage of revenue, are relatively stable and are not affected by increases in production at our locations. Our current mining tenants include Vulcan Materials, Martin Marietta and Cemex, among others. 

12 

Additionally, these locations provide us with excellent opportunities for valuable “second lives” for these assets through proper land planning and entitlement.

Significant “2^nd life” Mining Lands: 

Location	Acreage	Status
Brooksville, Fl	4,280 +/-	Development of Regional of Impact and County Land Use and Master Zoning in place for 5,800 residential unit, mixed-use development
Ft. Myers, FL	1,993 +/-	Approval in place for 105, 1 acre, waterfront residential lots after mining completed.
Gulf Hammock, Fl	1,600 +/-	Currently on the market for $4.5 million
Total	7,873 +/-

Land Development and Construction Segment.

Through our Land Development and Construction segment, we own and are continuously monitoring for their “highest and best use” several parcels of land that are in various stages of development.  Our overall strategy in this segment is to convert all of our non-income producing lands into income production through (i) an orderly process of constructing new warehouse/office buildings for us to own and operate or (ii) a sale to, or joint venture with, third parties.

Revenues in this segment are generated predominately from land sales and interim property rents. The significant cash outlays incurred in this segment are for land acquisition costs, entitlement costs, property taxes, design and permitting, the personnel costs of our in-house management team and horizontal and vertical construction costs.

Since 1990, one of our primary strategies in this segment has been to acquire, entitle and ultimately develop commercial/industrial business parks providing 5–15 building pads which we typically convert into warehouse/office buildings. To date, our management team has converted 26 of these pads into developed buildings that we continue to own and manage through the Asset Management segment. Our typical practice has been to transfer these assets to the Asset Management segment on the earlier to occur of (i) commencement of rental revenue or (ii) issuance of the certificate of occupancy. We have also opportunistically sold several of these pad sites over time to third party “users”. 

The remaining pad sites in our inventory today are fully entitled, located in business parks in four different submarkets in the DC/Baltimore/Northern Virginia area, and can support an additional +/- 1 million sf. of warehouse/office buildings. 

Summary of Our Remaining Lot Inventory: 

Location	Acreage	SF +/-	Status
Lakeside, MD	20	286,500	Horizontal development completed. Ready for vertical permitting.
Windlass Run Business Park, MD	17.5 (50% Interest)	164,500 (50% Interest)	Company owns a 50% in a joint venture formed in April 2016 with St. John Properties.  The joint venture owns the 35 acres and plans to develop the land into 12 office buildings for a total of 329,000 sq. ft.
Patriot Business Center, Manassas, VA	25	202,653	Horizontal development completed. Ready for vertical permitting.
Hollander 95 Business Park, MD	33	319,950	Horizontal development completed.
Total	95.5	973,603

We completed a third build-to-suit building for the same tenant at our Patriot Business Park and transferred that asset to the Asset Management segment on or about November 2014 when the building was approved for occupancy. Having sites ready for vertical construction has rewarded us in the past.  It is the main reason why we were able to convert 3 of our finished pads at Patriot Business Park into build-to-suit opportunities in 2012, 2013 and 2014.  We completed construction on a 79,550 square foot spec building at Hollander Business Park that was put into service in the third quarter of fiscal 2016. Also in the third quarter of fiscal 2016 we started construction on a 103,653 square foot building in Patriot Business

13 

Center and pre-leased 51,727 square feet. In April, 2016 we entered into a joint venture agreement to develop 12 office buildings on our remaining lots at Windlass Run and on adjacent frontage property owned by St. John Properties. We will continue to actively monitor these submarkets where we have lots ready for construction and take advantage of the opportunities presented to us.

In addition to the inventory of finished building lots, we have several other properties that were either spun-off to us from Florida Rock Industries in 1986 or acquired by us from unrelated 3rd parties. These properties, as a result of our “highest and best use” studies, are being prepared for income generation through sale or joint venture with third parties, and in certain cases we are leasing these properties on an interim basis for an income stream while we wait for the development market to mature.

Our strategy when selling parcels outright is to attempt to convert the proceeds into income producing real estate for our Asset Management segment through a Section 1031 tax-deferred exchange. An example of this is the Windlass Run 179 acre tract purchased for $5.2 million in 2002. When purchased, the entire parcel was zoned for commercial/industrial uses. Today, some 70 acres of this original tract makes up our Windlass Run Business Park. We successfully rezoned the remaining acreage for medium density residential development and on April 17, 2013, we entered into a contract to sell the residential portion of the property for $19 million. The first phase of the Windlass Run residential land was sold for

$8 million and the proceeds were used in a Section 1031 exchange to acquire our Transit Business Park in 2013. Phase 2 was sold in November, 2015 for $11.1 million and we used $9.9 million of the proceeds to acquire the fully leased Port Capital Building.

An example of property in this segment being developed through joint venture is Phase I of our RiverFront on the Anacostia project which was contributed to a joint venture with MRP in 2014 and is now under construction as a 305 unit apartment building including 18,000 sf of ground floor retail.

Significant Investment Lands Inventory:

Location	Approx. Acreage	Status	NBV
RiverFront on the Anacostia Phase I	2.1	Phase I under construction	$11,261,000
RiverFront on the Anacostia Phases II-IV	3.7	Phase II design approval plans to be submitted to Zoning Commission prior to December, 2016.	$9,801,000
Hampstead Trade Center, MD	117	Residential studies ongoing	$7,061,000
Square 664E,on the Anacostia River in DC	2	Under lease to Vulcan Materials as a concrete batch plant through 2021 with one 5 year renewal option.	$6,215,000
Total	125		$34,338,000

RIVERFRONT ON THE ANACOSTIA:

This property consists of 5.8 acres on the Anacostia River and is immediately adjacent to the Washington National’s baseball park in the SE Central Business District of Washington, DC. Once zoned for industrial use and under a ground lease, this property is no longer under lease and has been rezoned for the construction of approximately 1.1M square feet of “mixed-use” development in four phases. In 2014, approximately 2.1 acres (Phase I) of the total 5.8 acres was contributed to a joint venture owned by the Company (77%) and our partner, MRP Realty (23%), and construction commenced in October 2014 on a 305 unit residential apartment building with approximately 18,000 sq. ft. of first floor retail space. Lease up commenced in May 2016 and is expected to continue into fiscal 2017. Pre-leasing activity for the 305 residential units commenced in late May of 2016 and as of September 30, 2016 the residential units were 36.8% leased and 22.0% occupied. Phases II, III and IV are slated for residential, office, and hotel/residential buildings, respectively, all with permitted first floor retail uses. The company and MRP Realty executed a letter of intent in May 2016 to develop Phase II. In accordance with our Master Planned Unit Development (PUD) approval, Phase II plans were submitted to the Zoning Commission for final design approval on June 27, 2016.

14 

On August 24, 2015, in anticipation of commencing construction of the new Frederick Douglass bridge at a location immediately to the West of the existing bridge, the District of Columbia filed a Declaration of Taking for a total of 7,390 square feet of permanent easement and a 5,022 square foot temporary construction easement on land along the western boundary of the land that will ultimately hold Phase III and IV. Previously, the Company and the District had conceptually agreed to a land swap with no compensation that would have permitted the proposed new bridge, including construction easements, to be on property wholly owned by the District. As a result, the Planned Unit Development was designed and ultimately approved by the Zoning Commission as if the land swap would occur once the District was ready to move forward with the new bridge construction. In September 2016 the Company received $1,115,400 as settlement for the easement. The Company will continue to seek an agreement from the District that the existing bridge easement will terminate when the new bridge has been placed in service and the existing bridge has been removed. The Company’s position is that otherwise Phase IV will be adversely impacted and additional compensation or other relief will be due the Company.

HAMPSTEAD TRADE CENTER: We purchased this 117 acre tract in 2005 for $4.3 million in a Section 1031 exchange with plans of developing it as a commercial business park. The “great recession” caused us to reassess our plans for this property. As a result, Management has determined that the prudent course of action is to attempt to rezone the property for residential uses and sell the entire tract to another developer such that we can redeploy this capital into assets with more near-term income producing potential. In the fourth quarter of fiscal 2016, the Company received approval from the Town of Hampstead and has rezoned the property for residential use.

SQUARE 664E, WASHINGTON, DC

This property sits on the Anacostia River at the base of South Capitol Street in an area named Buzzard Point, approximately 1 mile down river from our RiverFront on the Anacostia property. The Square 664E property consists of approximately 2 acres and is currently under lease to Vulcan Materials for use as a concrete batch plant. The lease terminates on August 31, 2021 and Vulcan has the option to renew for one additional period of five (5) years. In the quarter ending December 31, 2014, the District of Columbia announced that it had selected Buzzard Point for the future site of the new DC United major league soccer stadium. The selected stadium location is separated from our property by just one small industrial lot.

COMPARATIVE RESULTS OF OPERATIONS

Fiscal Year 2016 versus 2015

Consolidated Results

(dollars in thousands)	Years Ended September 30,
	2016			2015		Change			%
Revenues:
Rental Revenue	$	24,457		$	23,410	$	1,047			4.5	%
Mining Royalty and rents		7,443			5,999		1,444			24.1	%
Revenue-Reimbursements		5,557			5,237		320			6.1	%
Total Revenues		37,457			34,646		2,811			8.1	%
Cost of operations:
Depreciation/Depletion/Amortization		8,051			7,378		673			9.1	%
Operating Expenses		4,624			4,609		15			0.3	%
Environmental remediation recovery		(1,000	)		—		(1,000	)		*
Property Taxes		4,475			4,443		32			0.7	%
Mgmt Co Allocation-In		1,844			1,647		197			12.0	%
Corporate Expense		3,080			3,307		(227	)		-6.9	%
Corp Mgmt fee not alloc. to discontinued operations		—			1,081		(1,081	)		-100.0	%
Total cost of operations		21,074			22,465		(1,391	)		-6.2	%

15 

Total operating profit		16,383			12,181			4,202		34.5	%
Interest Income and other		2			—			2		*
Interest Expense		(1,561	)		(2,014	)		453		-22.5	%
Equity in loss of joint ventures		(978	)		(145	)		(833	)	574.5	%
Gain (loss) on investment land sold		6,029			(34	)		6,063		17,832.4	%
Income from continuing operations before income taxes		19,875			9,988			9,887		99.0	%
Provision for income taxes		7,851			3,895			3,956		101.6	%
Income from continuing operations		12,024			6,093			5,931		97.3	%
Gain from discontinued transportation operations, net of taxes		—			2,179			(2,179	)	-100.0	%
Net income	$	12,024		$	8,272		$	3,752		45.4	%

Income from continuing operations for fiscal 2016 was $12,024,000 or $1.22 per share versus $6,093,000 or $.62 per share last year. Fiscal 2016 included $.43 per share from a gain on land sale of $6,029,000 and income of $1,000,000 from the $3 million environmental claim cash settlement received offset by a $2 million estimated liability for environmental remediation on Phase II. Post Spin-off we are reporting any net gain/(loss) from the transportation business as “discontinued operations” and we currently have no other discontinued operations being reported. For fiscal 2016 we received no benefit to after tax net income versus a $2,179,000 benefit last year. Additionally, GAAP accounting rules do not allow corporate overhead expense to be allocated to a discontinued operation of the Company which resulted in fiscal 2015 including $1,081,000 of corporate overhead expense to the Company that was associated with the discontinued transportation operations.

Total revenues were up $2,811,000, or 8.1%, versus the same period last year. Consolidated adjusted total operating profit in fiscal 2016 (excluding the positive impacts of the environmental settlement/expense (net) in this period and the negative impact of corporate expense not allocable to discontinued operations in the prior year) was up 16% over last year (see table “Non-GAAP Financial Measures).

Asset Management

Highlights of Fiscal 2016

• Revenue was up $1,169,000, or 4.2%, over the same period last year due to the addition of income producing square feet to our portfolio.

	Years Ended September 30
(dollars in thousands)	2016		%			2015		%			Change			%
Rental revenue	$	23,795		82.8	%	$	22,946		83.2	%	$	849			3.7	%
Revenue-reimbursements		4,944		17.2	%		4,624		16.8	%		320			6.9	%
Total revenue		28,739		100.0	%		27,570		100.0	%		1,169			4.2	%
Depreciation and amortization		7,689		26.8	%		6,963		25.3	%		726			10.4	%
Operating expenses		4,145		14.4	%		3,933		14.3	%		212			5.4	%
Property taxes		2,718		9.5	%		2,651		9.6	%		67			2.5	%
Management company indirect		813		2.8	%		735		2.7	%		78			10.6	%
Corporate expense		1,591		5.5	%		1,248		4.4	%		343			27.5	%
Cost of operations		16,956		59.0	%		15,530		56.3	%		1,426			9.2	%
Operating profit	$	11,783		41.0	%	$	12,040		43.7	%	$	(257	)		-2.1	%

Total revenues in this segment were $28,739,000, up $1,169,000 or 4.2%, over last year. Net operating income in this

16 

segment for fiscal 2016 was $21,944,000, compared to $21,043,000 last year, an increase of 4.3%. The increase was due mainly to completion of the third build-to-suit in the middle of the 2nd quarter last year, the acquisition of the Port Capital building in October of 2015 and the acquisition of the Gilroy Road building in July of 2016.

Depreciation and amortization expense increased primarily due to the two building purchases in fiscal 2016, accelerated depreciation of $139,000 for tenant improvements removed for a new tenant, and the write-off of prepaid commissions related to the bankruptcy of one of our tenants, ITT Educational Services. Corporate expense increased due to the Reallocation and higher professional fees.

Mining Royalty Lands Segment Results

Highlights of Fiscal 2016

• Mining Royalty and rents revenue were up $1,444,000, or 24%, as tons sold continued to increase at several of our locations.

	Years Ended September 30
(dollars in thousands)	2016		%			2015		%
Mining Royalty and rents	$	7,443		98.8	%		5,999		98.4	%
Revenue-reimbursements		90		1.2	%		95		1.6	%
Total revenue		7,533		100.0	%		6,094		100.0	%
Depreciation, depletion and amortization		104		1.4	%		133		2.2	%
Operating expenses		165		2.2	%		251		4.1	%
Property taxes		235		3.1	%		232		3.8	%
Corporate expense		231		3.1	%		1,322		21.7	%
Cost of operations		735		9.8	%		1,938		31.8	%
Operating profit	$	6,798		90.2	%	$	4,156		68.2	%

Total revenues in this segment were $7,533,000, an increase of 23.6%, versus $6,094,000 last year due to an increase in tons sold. Total operating profit in this segment was $6,798,000, an increase of $2,642,000 (inclusive of a $1,091,000 benefit from the Reallocation), versus $4,156,000 last year.

Land Development and Construction Segment Results

Highlights of Fiscal 2016

• The Company executed a letter of intent with MRP Realty in May 2016 to develop Phase II of the Riverfront on the Anacostia project and recorded an estimated environmental remediation expense of $2.0 million for the Company’s estimated liability under the proposed agreement.

17 

	Twelve months ended September 30
(dollars in thousands)	2016			2015			Change
Rental revenue	$	662			464			198
Revenue-reimbursements		523			518			5
Total revenue		1,185			982			203
Depreciation, depletion and amortization		258			282			(24	)
Operating expenses		314			425			(111	)
Environmental remediation recovery		(1,000	)		—			(1,000	)
Property taxes		1,522			1,560			(38	)
Management company indirect		1,031			912			119
Corporate expense		1,258			737			521
Cost of operations		3,383			3,916			(533	)
Operating loss	$	(2,198	)		(2,934	)		736

Beyond the aforementioned rezoning of Hampstead and settling the easement at Anacostia, during fiscal 2016 this segment successfully closed on the sale of Phase II of the Windlass Run residential land (a non-income producing property) for $11,288,000. Using $9,900,000 of the proceeds from that sale in a Section 1031 exchange, the Asset Management segment acquired the Port Capital building, a 91,218 square foot, 100% occupied warehouse with first full year projected rental revenue of $594,000. Management successfully completed negotiations and entered into a $3,000,000 settlement of environmental claims against our former tenant at the Riverfront on the Anacostia property and continues to pursue settlement negotiations with other potentially responsible parties. The Company executed a letter of intent with MRP Realty in May 2016 to develop Phase II of the Riverfront on the Anacostia project and recorded an estimated environmental remediation expense of $2.0 million for the Company’s estimated liability under the proposed agreement. Construction of the 79,550 square foot spec warehouse at Hollander Business Park was completed during the third quarter of this fiscal year and transferred to the Asset Management segment for lease-up. Also in the third quarter of fiscal 2016 we started construction on a 103,653 square foot building in Patriot Business Center and pre-leased 51,727 square feet.

Fiscal Year 2015 versus 2014

Consolidated Results

(dollars in thousands)	Years Ended September 30,
	2015			2014			Change			%
Revenues:
Rental Revenue	$	23,410		$	21,327		$	2,083			9.8	%
Mining Royalty and rents		5,999			5,256			743			14.1	%
Revenue-Reimbursements		5,237			4,395			842			19.2	%
Total Revenues		34,646			30,978			3,668			11.8	%
Cost of operations:
Depreciation/Depletion/Amortization		7,378			6,705			673			10.0	%
Operating Expenses		4,609			4,391			218			5.0	%
Property Taxes		4,443			3,494			949			27.2	%
Mgmt Co Allocation-In		1,647			1,424			223			15.7	%
Corporate Expense		3,307			2,539			768			30.2	%
Corp Mgmt fee not alloc. to discontinued operations		1,081			2,685			(1,604	)		-59.7	%
Total cost of operations		22,465			21,238			1,227			5.8	%
Total operating profit		12,181			9,740			2,441			25.1	%
Interest Income and other		—			23			(23	)		*
Interest Expense		(2,014	)		(1,366	)		(648	)		47.4	%
Equity in loss of joint ventures		(145	)		(128	)		(17	)		13.3	%
Gain (loss) on investment land sold		(34	)		476			(510	)		-107.1	%
Income from continuing operations before income taxes		9,988			8,745			1,243			14.2	%
Provision for income taxes		3,895			3,561			334			9.4	%
Income from continuing operations		6,093			5,184			909			17.5	%

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Gain from discontinued transportation operations, net of taxes		2,179		4,835		(2,656	)	-54.9	%
Net income	$	8,272	$	10,019	$	(1,747	)	-17.4	%

Fiscal 2015 total revenues for the Company were up 11.8% to $34,646,000. Adjusted income from continuing operations was $6,752,000 versus $6,822,000 in fiscal 2014. The decrease in adjusted income from continuing operations was due primarily to a (i) $648,000 increase in interest expense and (ii) $476,000 gain on investment land sold in fiscal 2014 versus a loss of $34,000 on investment land sold in fiscal 2015. Interest expense was greater primarily as a result of $722,000 more in capitalized interest in fiscal 2014 and $116,000 in prepayment penalties as the Company prepaid the $1,314,000 remaining principal balance on 8.55% and 7.95% mortgages in January. Adjusted operating profit improved to $13,262,000, a 6.7% increase over fiscal 2014.

The increase in revenues is mostly attributable to increases in rental rates, occupancy and total occupied square feet in our Asset Management segment and improved volumes at several of our mining locations. These increases were offset by increases in (i) depreciation expense ($673,000) due to the addition of assets to the portfolio, (ii) non-reimbursed property taxes, currently under appeal ($198,000 at our Anacostia Phase II-IV property), (iii) higher interest expense ($648,000) as a result of less capitalized interest in this period, and (iv) higher management ($223,000) and corporate expense ($768,000). Corporate expense increased due to (i) corporate level bonuses being paid in fiscal 2015 versus no corporate level bonuses in fiscal 2014, (ii) an increase in director compensation, and (iii) the additional cost of operating as a separate stand-alone public company.

Asset Management

	Years Ended September 30
(dollars in thousands)	2015		%			2014		%			Change		%
Rental revenue	$	22,946		83.2	%	$	20,837		83.9	%	$	2,109		10.1	%
Revenue-reimbursements		4,624		16.8	%		3,988		16.1	%		636		15.9	%
Total revenue		27,570		100.0	%		24,825		100.0	%		2,745		11.1	%
Depreciation, depletion and amortization		6,963		25.3	%		6,384		25.7	%		579		9.1	%
Operating expenses		3,933		14.3	%		3,896		15.7	%		37		1.0	%
Property taxes		2,651		9.6	%		2,174		8.8	%		477		21.9	%
Management company indirect		735		2.7	%		668		2.7	%		67		10.0	%
Corporate expense		1,248		4.4	%		958		3.8	%		290		30.3	%
Cost of operations		15,530		56.3	%		14,080		56.7	%		1,450		10.3	%
Operating profit	$	12,040		43.7	%	$	10,745		43.3	%	$	1,295		12.1	%

We continue to add square feet to this segment’s portfolio (129,850 in fiscal 2015) through construction and acquisition as we convert our non-income producing properties into income production. For fiscal 2015, net operating income, management’s chosen metric for measuring shareholder value creation in this segment, grew 12.4% to $21,043,000. Rental revenues in this segment were $22,946,000 in 2015, up $2,109,000 or 10.1% over fiscal 2014, due to increases in rental rates, occupancy and total occupied square feet as we have continued to add new buildings to the portfolio over the previous four fiscal years. Cost of operations increased $1,450,000 in 2015 due mainly to higher depreciation and higher property taxes as a result of the addition of new assets to the portfolio and higher corporate expenses. Operating profit in 2015 was $12,040,000, up $1,295,000 or 12.1%. Average annual occupancy was 90.8% during fiscal 2015 versus 89.8% during fiscal 2014. Rent growth for leases renewed during fiscal 2015 showed a 6.95% increase over the prior lease term. Over half of those renewals were from leases that had terms beginning in late 2009 and early 2010 when rental rates were far more in favor of the tenant.

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Mining Royalty Lands

	Years Ended September 30
(dollars in thousands)	2015		%			2014		%
Mining Royalty and rents	$	5,999		98.4	%		5,256		98.3	%
Revenue-reimbursements		95		1.6	%		93		1.7	%
Total revenue		6,094		100.0	%		5,349		100.0	%
Depreciation, depletion and amortization		133		2.2	%		124		2.3	%
Operating expenses		251		4.1	%		251		4.7	%
Property taxes		232		3.8	%		239		4.5	%
Corporate expense		1,322		21.7	%		1,016		19.0	%
Cost of operations		1,938		31.8	%		1,630		30.5	%
Operating profit	$	4,156		68.2	%	$	3,719		69.5	%

Mining sales volumes at several of our locations increased in fiscal 2015 resulting in an overall increase of 1,161,652 tons sold, up 23.4% over fiscal 2014. As a result, royalty revenues were $5,999,000, up $743,000 or 14.1% in fiscal 2015. Our operating profit in 2015 was $4,156,000, up $437,000 or 11.8% versus fiscal 2014. We believe that volumes will continue to increase at our locations as construction activity in Florida and Georgia improves, and Vulcan (i) continues the recent commencement of mining on our property at Astatula, (ii) shifts most of their production to our property at Manassas for the foreseeable future and (iii) is successful at obtaining final permit approval for our Ft. Myers location.

Land Development and Construction

	Years Ended September 30
(dollars in thousands)	2015			2014			Change
Rental revenue	$	464		$	490		$	(26	)
Revenue-reimbursements		518			314			204
Total revenue		982			804			178
Depreciation, depletion and amortization		282			197			85
Operating expenses		425			244			181
Property taxes		1,560			1,081			479
Management company indirect		912			756			156
Corporate expense		737			565			172
Cost of operations		3,916			2,843			1,073
Operating loss	$	(2,934	)	$	(2,039	)	$	(895	)

The Land Development and Construction segment is responsible for seeking opportunities to acquire existing income producing properties and managing and developing our non-income producing properties into income production; thus, this segment receives minimal revenues but incurs significant costs to accomplish this objective. During fiscal 2015, Management primarily focused its time in this segment on (i) working with our joint venture partner on the management of the on-going construction of Phase I at Riverfront on the Anacostia (n/k/a “Dock 79”), (ii) completion of the third build to suit at Patriot Business Park (iii) commencement of construction of a new 80,000 square foot spec warehouse/office building at our Hollander Business Park (iv) the sale of Windlass Run Residential Phase 2 and the evaluation of suitable Section 1031 replacement properties and (v) the evaluation of a proposed joint venture for the development and construction of a single story office park on the remainder of our undeveloped lands in the Windlass Run Business Park. In fiscal 2015, we invested over $4,085,000 with respect to the capital projects reported in this segment. Revenues were

20 

$982,000, up $178,000, over last year due mainly to higher real estate tax reimbursement from the ground lease at our Square 664E property in D.C. Costs of operating this segment were $3,916,000 in fiscal 2015 which was an increase of $1,073,000 driven primarily by higher property taxes ($479,000) due to the increase in assessed values of our 664E property and our Phases II-IV land at our Anacostia property and higher operating expenses ($181,000) as we undertook work to begin the reconstruction of the bulkhead at our Square 664E property in anticipation of future high rise development.

LIQUIDITY AND CAPITAL RESOURCES

The growth of the Company’s businesses requires significant cash needs to acquire and develop land or operating buildings and to construct new buildings and tenant improvements. As of September 30, 2016, we had $5,765,000 borrowed under our $20 million Wells Fargo revolver, $2,442,000 outstanding under letters of credit and $11,793,000 available to borrow under the revolver. The Company closed on a $20 million secured revolver with First Tennessee Bank on July 24, 2015 and as of September 30, 2016, we had $1,042,000 borrowed and $18,958,000 available to borrow under the revolver. First Tennessee has also committed to provide an additional $20 million of secured financing to the Company on a ten year term loan amortizing on a twenty five (25) year basis. We expect to close on this second loan with First Tennessee during fiscal 2017.

Cash Flows - The following table summarizes our cash flows from operating, investing and financing activities for each of the periods presented (in thousands of dollars):

			Years Ended September 30,
	2016						2015			2014
Total cash provided by (used for):
Operating activities	$	19,490			$	17,226			$		23,354
Investing activities		(15,039		)		(9,708		)			(39,371	)
Financing activities		(4,870		)		(8,112		)			16,528
(Decrease) increase in cash and cash equivalents	$	(419		)	$	(594		)	$		511
Outstanding debt at the beginning of the period	$	48,685				55,956					—
Outstanding debt at the end of the period	$	42,819				48,685					55,956

Operating Activities - Net cash provided by operating activities increased $2,264,000 to $19,490,000 for the year ended September 30, 2016. The total of net income plus depreciation, depletion and amortization less gains on sales of property and equipment decreased $1,678,000 versus the same period last year. These changes are described above under “Comparative Results of Operations”. The current period includes $5,261,000 less cash used to reduce accounts payable and accrued liabilities. The current period includes $1,694,000 larger increases to deferred and current income tax payables due to a 1031 exchange and other timing differences. Income and net cash from discontinued operations provided $4,984,000 benefit to the same period last year. The same period last year included offsetting increases to deferred income taxes and prepayment of current year income taxes.

In 2015, net cash provided by operating activities was $17,226,000 compared to $23,354,000 in 2014 due to the completion of build-to-suit’s and a $1,720,000 reduction in environmental remediation liability in 2015.

Investing Activities - For the year ended September 30, 2016, cash required by investing activities increased $5,331,000 to $15,039,000. The prior period discontinued operations cash required was $2,694,000 higher. Cash required by investing activities for continuing operations increased $8,025,000 due to buildings acquired during 2016. Proceeds from the sale of the Windlass Run Residential Phase 2 property of $11,288,000 was used in a tax deferred reverse Section 1031 exchange to acquire the Port Capital property for a total purchase price of $9,900,000. In July, 2016 the Gilroy Road building was purchased for $8,300,000.

In 2015, cash required by investing activities was $9,708,000 compared to $39,371,000 in 2014 due to increased construction activity in 2014.

Financing Activities – For the year ended September 30, 2016, cash required by financing activities was $4,870,000

21 

versus $8,112,000 in 2015. The prior period discontinued operations cash used was $1,631,000 higher due to debt repayment in the same period last year. Cash required by financing activities for continuing operations was $1,611,000 lower in the current period primarily due debt prepayment in the same period last year.

In January 2015 the Company prepaid the $1,314,000 remaining principal balance on 8.55% and 7.95% mortgages. The prepayment penalty of $116,000 is included in interest expense. The remaining deferred loan costs of $15,000 were also included in interest expense.

In 2015, cash required by financing activities was $8,112,000 compared to cash provided by financing activities of $16,528,000 in 2014 due to debt prepayments and payments on the revolver.

Credit Facilities - On January 30, 2015, in connection with the Spin-off, the Company terminated its $55 million credit facility entered with Wells Fargo Bank, N.A. in 2012 and simultaneously entered into a new five year credit agreement with Wells Fargo with a maximum facility amount of $20 million (the "Credit Agreement"). The Credit Agreement provides a revolving credit facility (the “Revolver”) with a $10 million sublimit available for standby letters of credit. At the time of the Spin-off, the Company refinanced $10,483,000 of borrowings then outstanding on the terminated revolver. As of September 30, 2016, there was $5,765,000 outstanding on the revolver and $2,442,000 outstanding under letters of credit and $11,793,000 available for borrowing. The letters of credit were issued to guarantee certain obligations to state agencies related to real estate development. Most of the letters of credit are irrevocable for a period of one year and typically are automatically extended for additional one-year periods. The Revolver bears interest at a rate of 1.4% over the selected LIBOR, which may change quarterly based on the Company’s ratio of Consolidated Total Debt to Consolidated Total Capital, as defined. A commitment fee of 0.15% per annum is payable quarterly on the unused portion of the commitment. The commitment fee may also change quarterly based upon the ratio described above. The credit agreement contains certain conditions and financial covenants, including a minimum $110 million tangible net worth. As of September 30, 2016, the tangible net worth covenant would have limited our ability to pay dividends or repurchase stock with borrowed funds to a maximum of $73 million combined. The Company was in compliance with all covenants as of September 30, 2016.

During the first quarter of fiscal 2015, the Company announced the execution of a commitment from First Tennessee Bank to provide up to $40 million dollars of mortgage backed financing in two separate facilities. On July 24, 2015 the Company closed on a five year, $20 million secured revolver with a twenty-four month window to convert up to the full amount of the facility into a ten year term loan. Interest accrues at 1.90% over one month LIBOR plus an annual commitment fee of 0.10%. As of September 30, 2016, there was $1,042,000 outstanding on the revolver and $18,958,000 available for borrowing. The second facility is a $20 million ten year term loan secured by to-be-determined collateral from our current pool of unencumbered warehouse/office properties. The purpose of these loans is to facilitate growth through new construction in the Land Development and Construction segment and/or acquisition of existing, operating buildings to be added to the Asset Management segment.

Cash Requirements – The Board of Directors has authorized Management to repurchase shares of the Company’s common stock from time to time as opportunities arise. During fiscal 2016 the Company repurchased 1,421 shares of stock. As of September 30, 2016, $4,957,000 was authorized for future repurchases of common stock. The Company does not currently pay any cash dividends on common stock.

The Company expended capital of $27,554,000 during fiscal 2016 primarily on the purchase of two warehouse/office buildings at Port Capital and Gilroy Road. These capital expenditures were funded mostly out of cash generation from operations and property sales or partly from borrowings under our credit facilities.

Non-GAAP Financial Measures.

To supplement the financial results presented in accordance with GAAP, FRP presents certain non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission. The non-GAAP financial measures included in this Annual Report on Form 10-K are adjusted income from continuing operations, adjusted operating profit, and net operating income (NOI). FRP uses these non-GAAP financial measures to analyze its continuing operations and to monitor, assess, and identify meaningful trends in its operating and financial performance. These

22 

measures are not, and should not be viewed as, a substitute for GAAP financial measures.

Post Spin-off we are reporting any net gain/(loss) from the transportation business as “discontinued operations” and we currently have no other discontinued operations being reported. GAAP accounting rules do not allow corporate overhead expenses to be allocated to a discontinued operation of the Company; thus, those corporate expenses attributable to the transportation business prior to the spin-off are charged to the Company as part of continuing operations.

Adjusted income from continuing operations

Adjusted income from continuing operations excludes the impact of the corporate expense not allocated to discontinued operations. Adjusted net income is presented to provide additional perspective on underlying trends in FRP’s core operating results. A reconciliation between income from continuing operations and adjusted income from continuing operations is as follows:

	For years ended September 30,
	2016		2015			2014
Income from continuing operations	$	12,024		6,093			5,184
Adjustments:
Corporate costs not allocated to discontinued operations		—		1,081			2,685
Income tax allocation		—		(422	)		(1,047	)
Adjusted income from continuing operations	$	12,024		6,752			6,822

Adjusted operating profit

Adjusted operating profit excludes the impact of the environmental remediation recovery and corporate expense not allocated to discontinued operations. Adjusted operating profit is presented to provide additional perspective on underlying trends in FRP’s core operating results. A reconciliation between operating profit and adjusted operating profit is as follows:

	For years ended September 30,
	2016			2015		2014
Operating profit	$	16,383			12,181		9,740
Adjustments:
Environmental remediation recovery		(1,000	)		—		—
Corporate costs not allocated to discontinued operations		—			1,081		2,685
Adjusted Operating profit	$	15,383			13,262		12,425

Net Operating Income Reconciliation
Year ended 9/30/16 (in thousands)
	Asset	Land	Mining	Unallocated	FRP
	Management	Development	Royalties	Corporate	Holdings
	Segment	Segment	Segment	Expenses	Totals
Income from continuing operations	6,188	1,738	4,098	—	12,024
Income Tax Allocation	4,041	1,134	2,676	—	7,851
Inc. from continuing operations  before income taxes	10,229	2,872	6,774	—	19,875
Less:
Gains on investment land sold	8	6,006
Lease intangible rents	27	—
Other income	—	2
Plus:
Unrealized rents	95	—
Equity in loss of Joint Venture	—	938
Interest Expense	1,562	—
Depreciation/Amortization	7,689	258
Management Co. Indirect	813	1,031
Allocated Corporate Expenses	1,591	1,257
Net Operating Income	21,944	348

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Net Operating Income Reconciliation
Year ended 9/30/15 (in thousands)
	Asset	Land		Mining	Unallocated		FRP
	Management	Development		Royalties	Corporate		Holdings
	Segment	Segment		Segment	Expenses		Totals
Income from continuing operations	6,146	(1,874	)	2,480	(659	)	6,093
Income Tax Allocation	3,930	(1,199	)	1,586	(422	)	3,895
Inc. from continuing operations  before income taxes	10,076	(3,073	)	4,066	(1,081	)	9,988
Less:
Lease intangible rents	53	—
Plus:  Loss on investment land sold	—	34
Unrealized rents	110	—
Equity in loss of Joint Venture	—	105
Interest Expense	1,964	—
Depreciation/Amortization	6,963	282
Management Co. Indirect	735	912
Allocated Corporate Expenses	1,248	737
Net Operating Income (loss)	21,043	(1,003	)

Net Operating Income Reconciliation
Year ended 9/30/14 (in thousands)
	Asset	Land		Mining	Unallocated		FRP
	Management	Development		Royalties	Corporate		Holdings
	Segment	Segment		Segment	Expenses		Totals
Income from continuing operations	5,599	(979	)	2,156	(1,592	)	5,184
Income Tax Allocation	3,846	(673	)	1,481	(1,093	)	3,561
Inc. from continuing operations  before income taxes	9,445	(1,652	)	3,637	(2,685	)	8,745
Less:
Gains on investment land sold	—	476
Other income	23	—
Lease intangible rents	81	—
Plus:
Unrealized rents	40	—
Equity in loss of Joint Venture	—	89
Interest Expense	1,323	—
Depreciation/Amortization	6,384	197
Management Co. Indirect	668	756
Allocated Corporate Expenses	958	565
Net Operating Income (loss)	18,714	(521	)

OFF-BALANCE SHEET ARRANGEMENTS

Except for the letters of credit described above under “Liquidity and Capital Resources,” the Company does not have any off balance sheet arrangements that either have, or are reasonably likely to have, a current or future material effect on its financial condition.

24 

CRITICAL ACCOUNTING POLICIES

Management of the Company considers the following accounting policies critical to the reported operations of the Company:

Accounts Receivable and Unrealized Rents Valuation. The Company is subject to customer credit risk that could affect the collection of outstanding accounts receivable and unrealized rents, that is rents recorded on a straight-lined basis. To mitigate these risks, the Company performs credit reviews on all new customers and periodic credit reviews on existing customers. A detailed analysis of late and slow pay customers is prepared monthly and reviewed by senior management. The overall collectibility of outstanding receivables and straight-lined rents is evaluated and allowances are recorded as appropriate. Significant changes in customer credit could require increased allowances and affect cash flows.

Property and Equipment and Impairment of Assets. Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

	Years
Buildings and improvements	3-39

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves.

The Company periodically reviews property and equipment for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. This review consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures. The Company’s estimated holding period for developed buildings with current vacancies is long enough that the undiscounted cash flows exceed the carrying value of the properties and thus no impairment loss is recorded. Changes in estimates or assumptions could have an impact on the Company’s financials.

All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a development cost of the property. Included in indirect costs is an estimate of internal costs associated with development and rental of real estate investments. Changes in estimates or assumptions could have an impact on the Company’s financials.

Income Taxes. The Company accounts for income taxes under the asset-and-liability method. Deferred tax assets and liabilities represent items that will result in taxable income or a tax deduction in future years for which the related tax expense or benefit has already been recorded in our statement of earnings. Deferred tax accounts arise as a result of timing differences between when items are recognized in the Consolidated Financial Statements compared with when they are recognized in the tax returns. The Company assesses the likelihood that deferred tax assets will be recovered from future taxable income. To the extent recovery is not probable, a valuation allowance is established and included as an expense as part of our income tax provision. No valuation allowance was recorded at September 30, 2016, as all deferred tax assets are considered more likely than not to be realized. Significant judgment is required in determining and assessing the impact of complex tax laws and certain tax-related contingencies on the provision for income taxes. As part of the calculation of the provision for income taxes, we assess whether the benefits of our tax positions are at least more likely than not of being sustained upon audit based on the technical merits of the tax position. For tax positions that are more likely than not of being sustained upon audit, we accrue the largest amount of the benefit that is more likely than not of being sustained in our consolidated financial statements. Such accruals require estimates and judgments, whereby actual results could vary materially from these estimates. Further, a number of years may elapse before a particular matter, for which an established accrual was made, is audited and resolved.

25 

CONTRACTUAL OBLIGATIONS

The following table summarizes our contractual obligations as of September 30, 2016:

	Payments due by period
			Less than		1-3	3-5	More than
		Total		1 year	years	years	5 years
Mortgages Including Interest	$	67,779		7,409	13,763	11,644	34,963
Revolving debt		6,807		-	-	6,807	-
Purchase Commitments		7,055		7,055	-	-	-
Total Obligations	$	81,641		14,464	13,763	18,451	34,963

INFLATION

Most of the Company’s operating expenses are inflation-sensitive, with inflation generally producing increased costs of operations. Substantially all of the Company’s royalty agreements are based on a percentage of the sales price of the related mined items. Minimum royalties and substantially all lease agreements provide escalation provisions.

SEASONALITY

The Company’s business is subject to limited seasonality due to the cyclical nature of our royalty revenues with revenues generally declining slightly during winter months.

FORWARD LOOKING STATEMENTS

Certain matters discussed in this report contain forward-looking statements, including without limitation relating to the Company's plans, strategies, objectives, expectations, intentions, capital expenditures, future liquidity, and plans and timetables for completion of pending development projects. The words or phrases “anticipate,” “estimate,” ”believe,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target” and similar expressions identify forward-looking statements. The following factors and others discussed in the Company’s periodic reports and filings with the Securities and Exchange Commission are among the principal factors that could cause actual results to differ materially from the forward-looking statements: levels of construction activity in the markets served by our mining properties; risk insurance markets; availability and terms of financing; competition; interest rates, inflation and general economic conditions; demand for flexible warehouse/office facilities in the Baltimore-Washington-Northern Virginia area; and ability to obtain zoning and entitlements necessary for property development. However, this list is not a complete statement of all potential risks or uncertainties.

These forward-looking statements are made as of the date hereof based on management’s current expectations, and the Company does not undertake an obligation to update such statements, whether as a result of new information, future events or otherwise. Additional information regarding these and other risk factors may be found in the Company’s other filings made from time to time with the Securities and Exchange Commission.

26 

CONSOLIDATED STATEMENTS OF INCOME - Years ended September 30

(in thousands, except per share amounts)

	2016				2015			2014
Revenues:
Rental revenue	$	24,457				23,410			21,327
Mining Royalty and rents		7,443				5,999			5,256
Revenue – reimbursements		5,557				5,237			4,395
Total Revenues		37,457				34,646			30,978
Cost of operations:
Depreciation, depletion and amortization		8,051				7,378			6,705
Operating expenses		4,624				4,609			4,391
Environmental remediation expense (recovery)		(1,000		)		—			—
Property taxes		4,475				4,443			3,494
Management company indirect		1,844				1,647			1,424
Corporate expenses (Note 4 Related Party)		3,080				4,388			5,224
Total cost of operations		21,074				22,465			21,238
Total operating profit		16,383				12,181			9,740
Interest income		2				—			23
Interest expense		(1,561	)	)		(2,014	)		(1,366	)
Equity in loss of joint ventures		(978	)	)		(145	)		(128	)
Gain (Loss) on investment land sold		6,029				(34	)		476
Income from continuing operations before income taxes		19,875				9,988			8,745
Provision for income taxes		7,851				3,895			3,561
Income from continuing operations		12,024				6,093			5,184
Gain from discontinued transportation operations, net of taxes		—				2,179			4,835
Net income	$	12,024				8,272			10,019
Earnings per common share:
Income from continuing operations-
Basic		1.22				0.62			0.54
Diluted		1.22				0.62			0.53
Discontinued operations-
Basic		0.00				0.23			0.50
Diluted		0.00				0.22			0.50
Net Income-
Basic		1.22				0.85			1.04
Diluted		1.22				0.84			1.03
Number of shares (in thousands) used in computing:
-basic earnings per common share		9,846				9,756			9,629
-diluted earnings per common share		9,890				9,827			9,710

See accompanying notes.

27 

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - Years ended September 30

(In thousands)

		2016	2015		2014
Net income	$	12,024	8,272		10,019
Other comp. income (loss) net of tax:
Spin-off adjustment		—	(53	)	—
Actuarial loss retiree health		—	—		(2	)
Minimum pension liability		26	7		4
Comprehensive income	$	12,050	8,226		10,021

See accompanying notes.

28 

CONSOLIDATED BALANCE SHEETS - As of September 30

(In thousands, except share data)

Assets:	2016		2015
Real estate investments at cost:
Land	$	99,357		102,347
Buildings and improvements		193,283		174,820
Projects under construction		8,592		4,129
Total investments in properties		301,232		281,296
Less accumulated depreciation and depletion		80,616		74,091
Net investments in properties		220,616		207,205
Real estate held for investment, at cost		7,176		7,306
Real estate held for sale, at cost		—		4,826
Investment in joint ventures		23,854		19,010
Net real estate investments		251,646		238,347
Cash and cash equivalents		—		419
Accounts receivable		987		778
Federal and state income taxes receivable		—		393
Unrealized rents		4,657		4,817
Deferred costs		8,208		7,449
Other assets		178		275
Total assets	$	265,676		252,478
Liabilities:
Line of credit payable	$	6,807		8,494
Secured notes payable, current portion		4,455		4,180
Secured notes payable, less current portion		31,557		36,011
Accounts payable and accrued liabilities		4,344		3,456
Environmental remediation liability		2,037		51
Bank overdraft		6		—
Federal and state income taxes payable		13		—
Deferred revenue		1,423		1,060
Deferred income taxes		16,436		14,541
Deferred compensation		1,453		1,400
Deferred lease intangible, net		14		45
Tenant security deposits		1,032		898
Total liabilities		69,577		70,136
Commitments and contingencies (Note 13 & 14)
Equity:
Common stock, $.10 par value 25,000,000 shares authorized, 9,867,279 and 9,791,770 shares issued and outstanding, respectively		987		979
Capital in excess of par value		51,606		49,872
Retained earnings		143,486		131,497
Accumulated other comprehensive income ( loss), net		20		(6	)
Total shareholders’ equity		196,099		182,342
Total liabilities and shareholders’ equity	$	265,676		252,478

See accompanying notes.

29 

CONSOLIDATED STATEMENTS OF CASH FLOWS - Years ended September 30

(In thousands)		2016		2015			2014
Cash flows from operating activities:
Net income	$	12,024		8,272			10,019
Adjustments to reconcile net income to
net cash provided by continuing operating activities:
Income from discontinued operations, net		-			(2,179	)		(4,835		)
Depreciation, depletion and amortization		8,288			7,533			6,845
Deferred income taxes		1,895			1,572			(340		)
Equity in loss of joint ventures		978			145			128
(Gain) loss on sale of equipment and property		(6,047	)		138			(485		)
Stock-based compensation		578			803			1,139
Net changes in operating assets and liabilities:
Accounts receivable		(209	)		349			1,272
Deferred costs and other assets		(1,816	)		(1,489	)		(2,040		)
Accounts payable and accrued liabilities		3,237			(2,024	)		(718		)
Income taxes payable and receivable		406			(965	)		270
Other long-term liabilities		156			87			209
Net cash provided by operating activities of continuing operations		19,490			12,242			11,464
Net cash provided by operating activities of discontinued operations		-			4,984			11,890
Net cash provided by operating activities		19,490			17,226			23,354
Cash flows from investing activities:
Investments in properties		(27,554	)		(6,493	)		(19,283		)
Investments in joint ventures		(929	)		(625	)		(5,266		)
Cash held in escrow		-			61			1,508
Proceeds from sale of real estate held for  investment and properties		13,444			43			1,888
Net cash used in investment activities of continuing operations		(15,039	)		(7,014	)		(21,153		)
Net cash used in investing activities of discontinued operations		-			(2,694	)		(18,218		)
Net cash used in investing activities		(15,039	)		(9,708	)		(39,371		)
Cash flows from financing activities:
Increase in bank overdrafts		6			-			-
Repayment of long-term debt		(4,179	)		(5,402	)		(4,311		)
Proceeds from borrowing on revolving credit facility		29,583		19,400					31,298
Payment on revolving credit facility		(31,270	)		(21,269	)		(20,935		)
Debt issue costs		(139	)		(397	)		-
Repurchase of company stock		(43	)		-			-
Excess tax benefits from exercises of stock options		-			175			1,047
Exercise of employee stock options		1,172			1,012			1,462
Net cash (used in) provided by financing activities of continuing operations		(4,870	)		(6,481	)		8,561
Net cash (used in) provided by financing activities of discontinued operations		-			(1,631	)		7,967
Net cash (used in) provided by financing activities		(4,870	)		(8,112	)		16,528
Net (decrease) increase in cash and cash equivalents		(419	)		(594	)		511
Cash and cash equivalents at beginning of year		419			1,013			502
Cash and cash equivalents at end of the year	$	-			419			1,013
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest, net of capitalized amounts	$	1,538			2,335			1,475
Income taxes	$	5,565			3,923			6,180

See accompanying notes.

30 

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - Years ended September 30

(In thousands, except share amounts)

												Accumu-
												lated
												Other
												Compre-			Total
						Capital in						hensive			Share
	Common Stock					Excess of			Retained			Income, net			Holders’
	Shares			Amount		Par Value			Earnings			of tax			Equity
Balance at October 1, 2013		9,564,220		$	956	$	44,258		$	147,394		$	38		$	192,646
Exercise of stock options		119,550			12		1,450									1,462
Excess tax benefits from
exercises of stock options
and vesting of restricted stock							1,047									1,047
Stock option compensation							441									441
Shares granted to Directors		19,500			2		696									698
Net income										10,019						10,019
Minimum pension liability, net													4			4
Net actuarial loss retiree health, net													(2	)		(2	)
Balance at September 30, 2014		9,703,270		$	970	$	47,892		$	157,413		$	40		$	206,315
Exercise of stock options		72,300			7		1,005									1,012
Excess tax benefits from
exercises of stock options							174									174
Stock option compensation							267									267
Shares granted to Directors		16,200			2		534									536
Spin-off adjustment										(34,188	)		(53	)		(34,241	)
Net income										8,272						8,272
Minimum pension liability, net													7			7
Balance at September 30, 2015		9,791,770		$	979	$	49,872		$	131,497		$	(6	)	$	182,342
Exercise of stock options		63,730			7		1,165									1,172
Stock option compensation							166									166
Shares granted to Directors		13,200			1		411									412
Shares purchased and cancelled		(1,421	)				(8	)		(35	)					(43	)
Net income										12,024						12,024
Minimum pension liability, net													26			26
Balance at September 30, 2016		9,867,279		$	987	$	51,606		$	143,486		$	20		$	196,099

31 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Accounting Policies.

ORGANIZATION - FRP Holdings, Inc. (“FRP” or the “Company”) is a holding company engaged in the real estate business, namely (i) warehouse/office building ownership, leasing and management, (ii) mining royalty land ownership and leasing and (iii) land acquisition, entitlement and development primarily for future warehouse/office building construction. On January 30, 2015, FRP completed the tax-free Spin-off (“Spin-off”) of its transportation business into a new, separately traded public company, Patriot Transportation Holding, Inc. (Nasdaq GM: PATI) (“Patriot”). In the Spin-off, FRP distributed all of the outstanding stock of Patriot to FRP's shareholders as of the record date of January 9, 2015. FRP’s shareholders received one share of Patriot for every three shares of FRP owned on the record date. Patriot now is an independent, publicly traded company, and FRP retains no ownership in Patriot. The Company retained the real estate business, which is now the sole business of the Company. See Note 3 regarding more information regarding the spin-off.

FRP Holdings, Inc. was incorporated on April 22, 2014 in connection with a corporate reorganization that preceded the Spin-off. The Company’s successor issuer was formed on July 20, 1998. The business of the Company is conducted through our wholly-owned subsidiaries FRP Maryland, Inc., a Maryland corporation, FRP Development Corp., a Maryland corporation and Florida Rock Properties, Inc., a Florida corporation, and the various subsidiaries of each.

CONSOLIDATION - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Investments in the Brooksville joint venture, BC FRP Realty joint venture and Riverfront Investment Partners I, LLC are accounted for under the equity method of accounting (See Note 2). All significant intercompany transactions have been eliminated in consolidation.

CASH AND CASH EQUIVALENTS - The Company considers all highly liquid debt instruments with maturities of three months or less at time of purchase to be cash equivalents. Bank overdrafts consist of outstanding checks not yet presented to a bank for settlement, net of cash held in accounts with right of offset.

REVENUE AND EXPENSE RECOGNITION - Real estate rental revenue and mining royalties are generally recognized when earned under the leases and are considered collectable. Rental income from leases with scheduled increases or other incentives during their term is recognized on a straight-line basis over the term of the lease. Reimbursements of expenses, when provided in the lease, are recognized in the period that the expenses are incurred.

Sales of real estate are recognized when the collection of the sales price is reasonably assured and when the Company has fulfilled substantially all of its obligations, which are typically as of the closing date.

Accounts receivable are recorded net of discounts and provisions for estimated allowances. We estimate allowances on an ongoing basis by considering historical and current trends. We record estimated bad debts expense as part of operating expenses. We estimate the net collectibility of our accounts receivable and establish an allowance for doubtful accounts based upon this assessment. Specifically, we analyze the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms.

PROPERTY AND EQUIPMENT - Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

	Years
Building and improvements	3-39

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves. Reserve estimates are periodically adjusted based upon surveys.

32 

The Company recorded depreciation and depletion expenses for 2016, 2015 and 2014 of $6,809,000, $6,195,000, and $5,528,000, respectively.

All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property. Included in indirect costs is an allocation of internal costs associated with development of real estate investments. The cost of routine repairs and maintenance to property and equipment is expensed as incurred.

IMPAIRMENT OF LONG-LIVED ASSETS – The Company periodically reviews its long-lived assets, which include property and equipment and purchased intangible assets subject to amortization for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. This review consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures.

DEVELOPED PROPERTY RENTALS PURCHASE ACCOUNTING – Acquisitions of rental property, including any associated intangible assets, are measured at fair value at the date of acquisition. Any liabilities assumed or incurred are recorded at their fair value at the time of acquisition. The fair value of the acquired property is allocated between land and building (on an as-if vacant basis) based on management’s estimate of the fair value of those components for each type of property and to tenant improvements based on the depreciated replacement cost of the tenant improvements, which approximates their fair value. The fair value of the in-place leases is recorded as follows:

· the fair value of leases in-place on the date of acquisition is based on absorption costs for the estimated lease-up period in which vacancy and foregone revenue are avoided due to the presence of the acquired leases;

· the fair value of above and below-market in-place leases based on the present value (using a discount rate that reflects the risks associated with the acquired leases) of the difference between contractual rent amounts to be paid under the assumed lease and the estimated market lease rates for the corresponding spaces over the remaining non-cancelable terms of the related leases; and

· the fair value of intangible tenant or customer relationships.

The Company’s determination of these fair values requires it to estimate market rents for each of the leases and make certain other assumptions. These estimates and assumptions affect the rental revenue, and depreciation and amortization expense recognized for these leases and associated intangible assets and liabilities.

INVESTMENTS - The Company uses the equity method to account for its investment in Brooksville, in which it has a voting interest of 50% and has significant influence but does not have control. The Company uses the equity method to account for its investment in BC FRP Realty, in which it has a voting interest of 50%. The Company uses the equity method to account for its investment in RiverFront Investment Partners I, LLC, in which the equity interest will be determined based on leverage of the entity, additional cash contributions by the Company, and negotiations with potential third partners. Under the equity method, the investment is originally recorded at cost and adjusted to recognize the Company’s share of net earnings or losses of the investee, limited to the extent of the Company’s investment in and advances to the investee and financial guarantees on behalf of the investee that create additional basis. The Company regularly monitors and evaluates the realizable value of its investments. When assessing an investment for an other-than-temporary decline in value, the Company considers such factors as, the performance of the investee in relation to its own operating targets and its business plan, the investee’s revenue and cost trends, as well as liquidity and cash position, and the outlook for the overall industry in which the investee operates. From time to time, the Company may consider third party evaluations or valuation reports. If events and circumstances indicate that a decline in the value of these assets has occurred and is other-than-temporary, the Company records a charge to investment income (expense).

INCOME TAXES - Deferred tax assets and liabilities are recognized based on differences between financial statement and tax bases of assets and liabilities using presently enacted tax rates. Deferred income taxes result from temporary differences between pre-tax income reported in the financial statements and taxable income. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for

33 

recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination of the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of limitations, effectively settled issues under audit, and audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. It is the Company's policy to recognize as additional income tax expense the items of interest and penalties directly related to income taxes.

STOCK BASED COMPENSATION – The Company accounts for compensation related to share based plans by recognizing the grant date fair value of stock options and other equity-based compensation issued to employees in its income statement over the requisite employee service period using the straight-line attribution model. In addition, compensation expense must be recognized for the change in fair value of any awards modified, repurchased or cancelled after the grant date. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used in the model and current year impact are discussed in Note 8.

PENSION PLAN - The Company accounts for its pension plan following the requirements of FASB ASC Topic 715, “Compensation – Retirement Benefits”, which requires an employer to: (a) recognize in its statement of financial position the funded status of a benefit plan; (b) measure defined benefit plan assets and obligations as of the end of the employer's fiscal year (with limited exceptions); and (c) recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise but are not recognized as components of net periodic benefit costs pursuant to prior existing guidance.

EARNINGS PER COMMON SHARE - Basic earnings per common share are based on the weighted average number of common shares outstanding during the periods. Diluted earnings per common share are based on the weighted average number of common shares and potential dilution of securities that could share in earnings. The differences between basic and diluted shares used for the calculation are the effect of employee and director stock options and restricted stock.

USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United State requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain accounting policies and estimates are of more significance in the financial statement preparation process than others. The most critical accounting policies and estimates include the economic useful lives of our property and equipment, provisions for uncollectible accounts receivable and collectibility of unrealized rents, estimates of exposures related to our insurance claims plans, and estimates for taxes. To the extent that actual, final outcomes are different than these estimates, or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting period will be affected.

ENVIRONMENTAL - Environmental expenditures that benefit future periods are capitalized. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded for the estimated amount of expected environmental assessments and/or remedial efforts. Estimation of such liabilities includes an assessment of engineering estimates, continually evolving governmental laws and standards, and potential involvement of other potentially responsible parties.

COMPREHENSIVE INCOME – Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) refers to expenses, gains, and losses that are not included in net income, but rather are recorded directly in shareholders’ equity.

34 

RECENTLY ISSUED ACCOUNTING STANDARDS – In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes”. The guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. The guidance becomes effective for annual reporting periods beginning after December 15, 2016 with early adoption permitted. The Company adopted this guidance retrospectively as of October 1, 2015 and reclassified $143,000 from deferred costs to long-term deferred tax liability.

In February 2016, the FASB issued ASU No. 2016-02, “Leases”, which requires lessees to recognize a right-to-use asset and a lease obligation for all leases. Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less. Additional qualitative and quantitative disclosures, including significant judgments made by management, will be required. Lessors will account for leases using an approach that is substantially equivalent to existing accounting standards. The new standard will become effective for the Company beginning with the first quarter 2020 and requires a modified retrospective transition approach and includes a number of practical expedients. Early adoption of the standard is permitted. As the Company is primarily a lessor the adoption of this guidance is not expected to have a material impact on its financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. Excess tax benefits for share-based payments will be recorded as a reduction of income taxes and reflected in operating cash flows upon the adoption of this ASU. Excess tax benefits are currently recorded in equity and as financing activity under the current rules. In addition, the guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2016 with early adoption permitted. The Company may early adopt this accounting guidance in fiscal 2017 or as required in fiscal 2018.

2. Investments in Joint Ventures.

RiverFront. On March 30, 2012 the Company entered into a Contribution Agreement with MRP SE Waterfront Residential, LLC. (“MRP”) to form a joint venture to develop the first phase only of the four phase master development known as RiverFront on the Anacostia in Washington, D.C. The purpose of the Joint Venture is to develop, own, lease and ultimately sell an approximately 300,000 square foot residential apartment building (including approximately 18,000 square feet of retail) on approximately 2 acres of the roughly 5.82 acre site. The joint venture, RiverFront Investment Partners I, LLC (“RiverFront I”) was formed in June 2013 as contemplated. The Company contributed land with an agreed to value of $13,500,000 (cost basis of $6,165,000) and contributed cash of $4,866,000 to the Joint Venture for a 76.91% stake in the venture. MRP contributed capital of $5,553,000 to the joint venture including development costs paid prior to formation of the joint venture. The Joint Venture closed on $17,000,000 of EB5 secondary financing and a nonrecourse construction loan for $65,000,000 on August 8, 2014. Both these financing sources are non-recourse to FRP. At the time of these financings, RiverFront Holdings I, LLC. was formed as a parent to RiverFront Investment Partners I, LLC with EB5 as an equity partner in Riverfront Holdings I, LLC. Construction commenced in October 2014. At this point, the Company anticipates lease up to occur in the second half of calendar 2016 and all of 2017. The Company’s equity interest in the joint venture is accounted for under the equity method of accounting as MRP acts as the administrative agent of the joint venture and oversees and controls the day to day operations of the project.

Other income for fiscal 2016 includes a loss of $938,000 representing the Company’s portion of the loss of this joint venture due primarily to expenses incurred in the joint venture with respect to real estate taxes, advertising expense, depreciation on the bulkhead, and audit fees.

Brooksville. In 2006, the Company entered into a Joint Venture Agreement with Florida Rock Industries, Inc. (now owned by Vulcan Materials Company) to jointly own and develop approximately 4,300 acres of land near Brooksville, Florida. Under the terms of the joint venture, FRP contributed its fee interest in approximately 3,443 acres formerly leased to Vulcan under a long-term mining lease which had a net book value of $2,548,000. Vulcan is entitled to mine a portion of the property until 2022 and pay royalties to the Company. FRP also contributed $3,018,000 for one-half of

35 

the acquisition costs of a 288-acre contiguous parcel. Vulcan contributed 553 acres that it owned as well as its leasehold interest in the 3,443 acres that it leased from FRP and $3,018,000 for one-half of the acquisition costs of the 288-acre contiguous parcel. The joint venture is jointly controlled by Vulcan and FRP, and they each have a mandatory obligation to fund additional capital contributions of up to $2,430,000. Capital contributions of $2,397,000 have been made by each party as of September 30, 2016. Distributions will be made on a 50-50 basis except for royalties and depletion specifically allocated to the Company. Other income for fiscal 2016 includes a loss of $40,000 representing the Company’s portion of the loss of this joint venture. In April 2011, the Florida Department of Community Affairs issued its Final Order approving the development of the Project, and zoning for the Project was obtained from Hernando County in August 2012. We will continue to monitor the residential market in Hernando County and pursue opportunities to partner with a master community developer or major homebuilder to commence construction when the market dictates.

BC FRP Realty (Windlass Run). During the 2nd quarter, we entered into an agreement with a substantial Baltimore development company (St. John Properties, Inc.) to jointly develop the remaining lands of our Windlass Run Business Park. The 50/50 partnership initially calls for FRP to combine its 25 acres (valued at $7,500,000) with St. John Properties’ adjacent 10 acres fronting on a major state highway (valued at $3,239,536) which resulted in an initial cash distribution of $2,130,232 to FRP in May, 2016. Thereafter, the venture will jointly develop the combined properties into a multi-building business park to consist of approximately 329,000 square feet of single story office space.

Investments in Joint Ventures (in thousands):

							The
							Company's
				Total Assets	Net Loss		Share of Net
			Total	of the	of the		Loss of the
	Ownership		Investment	Partnership	Partnership		Partnership
As of September 30, 2016
RiverFront Holdings I, LLC	77.14	%	$  11,261	$  85,106	$   (1,193	)	$   (938	)
Brooksville Quarry, LLC	50.00	%	7,496	14,350	(80	)	(40	)
BC FRP Realty, LLC	50.00	%	5,097	10,573	—		—
Total			$  23,854	$ 110,029	$  (1,273	)	$  (978	)
As of September 30, 2015
RiverFront Holdings I, LLC	76.91	%	$  11,517	$  40,970	$   (108	)	$   (105	)
Brooksville Quarry, LLC	50.00	%	7,493	14,336	(80	)	(40	)
Total			$  19,010	$  55,306	$  (188	)	$  (145	)

Summarized Financial Information for the Investments in Joint Ventures (in thousands):

	As of September 30, 2016
	Riverfront		Brooksville		BCF FRP
	Holdings I, LLC		Quarry, LLC		Realty, LLC		Total
Cash	$	297	$	35	$	20	$	352
Cash held in escrow		13		—		—		13
Amortizable Debt Costs		1,179		—		—		1,179
Investments in real estate, net		83,617		14,315		10,553		108,485
Total Assets	$	85,106	$	14,350	$	10,573	$	110,029
Other Liabilities	$	5,140	$	65	$	17	$	5,222
Long-term Debt		63,495		—		—		63,495
Capital - FRP		11,261		7,496		5,097		23,854
Capital - Third Parties		5,210		6,789		5,459		17,458
Total Liabilities and Capital	$	85,106	$	14,350	$	10,573	$	110,029

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	As of September 30, 2015
	Riverfront		Brooksville
	Holdings I, LLC		Quarry, LLC		Total
Cash	$	47	$	14	$	61
Cash held in escrow		3,420		—		3,420
Amortizable Debt Costs		1,593		—		1,593
Investments in real estate, net		35,910		14,322		50,232
Total Assets	$	40,970	$	14,336	$	55,306
Other Liabilities	$	6,905	$	64	$	6,969
Long-term Debt		17,000		—		17,000
Capital - FRP		11,517		7,493		19,010
Capital - Third Parties		5,548		6,779		12,327
Total Liabilities and Capital	$	40,970	$	14,336	$	55,306

Income statements for the RiverFront Holdings I, LLC (in thousands):

	Years Ended September 30,
	2016			2015			2014
Revenue	$	127			—			—
Cost of operations		1,040			108			89
Operating profit		(913	)		(108	)		(89	)
Interest expense		(280	)		—			—
Net loss of the Partnership	$	(1,193	)		(108	)		(89	)

The amount of consolidated retained earnings for these joint ventures was $(990,000) and $(389,000) as of September 30, 2016 and 2015 respectively.

3. Spin-off.

On January 30, 2015, FRP Holdings, Inc. (Nasdaq GM: FRPH) (the “Company” or “FRP”) completed the spin-off of its transportation business into a new, separately traded public company - Patriot Transportation Holding, Inc. (Nasdaq GM: PATI) (“Patriot”) - resulting in FRP becoming a pure real estate company. As a result, the former transportation segment is reported as a discontinued operation without any corporate overhead allocation. Hence, all corporate overhead attributable to the transportation group through the date of the spin-off is included in “corporate expense” on the Company’s historical consolidated income statements.

The results of operations associated with discontinued operations were as follows (in thousands):

	Years Ended September 30,
	2016		2015			2014
Revenue	$	—		41,800			129,162
Cost of operations		—		38,195			121,134
Operating profit		—		3,605			8,028
Interest expense		—		(33	)		(102	)
Income before income taxes		—		3,572			7,926
Provision for income taxes		—		1,393			3,091
Income from discontinued operations	$	—		2,179			4,835

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The following table presents the carrying value of the major categories of assets and liabilities of discontinued operations reflected on the Company’s consolidated balance sheets at September 30, 2014:

Property and  equipment, net	$	42,174
Accounts receivable, net		7,119
Deferred costs		11,809
Other assets		32
Assets of discontinued operation	$	61,134
Line of credit	$	7,282
Accounts payable and accrued liabilities		11,489
Deferred compensation		717
Deferred income taxes		8,924
Liabilities of discontinued operation	$	28,412

4. Related Party Transactions.

In order to effect the Spin-off and govern our relationship with Patriot Transportation Holding, Inc. after the Spin-off, we entered into an Employee Matters Agreement and a Transition Services Agreement. The Employee Matters Agreement generally allocates responsibilities to each company for liabilities relating to each Company’s current and former employees and allocated responsibilities under employee benefit plans. The Transition Services Agreement sets forth the terms on which Patriot will provide to FRP certain services that were shared prior to the Spin-off, including the services of certain shared executive officers, for a period of 12 or more months after the Spin-off. The boards of the respective companies have since extended these agreements for an additional twelve months.

The consolidated statements of income reflect charges and/or allocation from Patriot for these services of $1,542,000, $2,211,000, and $2,539,000 for fiscal 2016, 2015 and 2014, respectively. Included in the charges above are amounts recognized for corporate executive stock-based compensation expense. These charges are reflected as part of corporate expenses.

To determine these allocations between FRP and Patriot as set forth in the Transition Services Agreement, we generally employed the same methodology historically used by the Company pre Spin-off to allocate said expenses and thus we believe that the allocations to FRP are a reasonable approximation of the costs related to FRP’s operations but any such related-party transactions cannot be presumed to be carried out on an arm’s-length basis as the terms were negotiated while Patriot was still a subsidiary of FRP.

As a result of the Spin-off the former transportation segment of the Company is reported as a discontinued operation and thus is not allowed any corporate overhead allocation. Hence, all corporate overhead of the transportation group through the date of the Spin-off is included in “corporate expense” on the Company’s consolidated income statements. The consolidated statements of income reflect charges and/or allocation for these services of $1,081,000 and $2,685,000 for fiscal 2015 and 2014, respectively.

5. Debt.

Debt at September 30 is summarized as follows (in thousands):

	2016		2015
Revolving credit agreements	$	6,807		8,494
5.6% to 7.9% mortgage notes
due in installments through 2027		36,012		40,191
		42,819		48,685
Less portion due within one year		4,455		4,180
	$	38,364		44,505

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The aggregate amount of principal payments, excluding the revolving credit, due subsequent to September 30, 2016 is: 2017 - $4,455,000; 2018 – $4,673,000; 2019 - $3,885,000; 2020 - $3,725,000; 2021 - $3,485,000 and subsequent years - $15,789,000.

The non-recourse fully amortizing mortgage notes payable are collateralized by real estate having a carrying value of approximately $45,478,000 at September 30, 2016.

On January 30, 2015, in connection with the Spin-off, the Company terminated its $55 million credit facility entered into with Wells Fargo Bank, N.A. in 2012 and simultaneously entered into a new five year credit agreement with Wells Fargo with a maximum facility amount of $20 million (the "Credit Agreement"). The Credit Agreement provides a revolving credit facility (the “Revolver”) with a $10 million sublimit available for standby letters of credit. At the time of the Spin-off, the Company refinanced $10,483,000 of borrowings then outstanding on the terminated revolver. As of September 30, 2016, there was $5,765,000 outstanding on the revolver, $2,442,000 outstanding under letters of credit and $11,793,000 available for borrowing. The letters of credit were issued to guarantee certain obligations to state agencies related to real estate development. Most of the letters of credit are irrevocable for a period of one year and typically are automatically extended for additional one-year periods. The Revolver bears interest at a rate of 1.4% over the selected LIBOR, which may change quarterly based on the Company’s ratio of Consolidated Total Debt to Consolidated Total Capital, as defined. A commitment fee of 0.15% per annum is payable quarterly on the unused portion of the commitment. The commitment fee may also change quarterly based upon the ratio described above. The credit agreement contains certain conditions and financial covenants, including a minimum $110 million tangible net worth. As of September 30, 2016, the tangible net worth covenant would have limited our ability to pay dividends or repurchase stock with borrowed funds to a maximum of $73 million combined. The Company was in compliance with all covenants as of September 30, 2016.

During the first quarter of fiscal 2015, the Company announced the execution of a commitment from First Tennessee Bank to provide up to $40 million dollars of mortgage backed financing in two separate facilities. On July 24, 2015 the Company closed on a five year, $20 million secured revolver with a twenty-four month window to convert up to the full amount of the facility into a ten year term loan. Interest accrues at 1.90% over one month LIBOR plus an annual commitment fee of 0.10%. As of September 30, 2016, there was $1,042,000 outstanding on the revolver and $18,958,000 available for borrowing. The second facility is a $20 million ten year term loan secured by to-be-determined collateral from our current pool of unencumbered warehouse/office properties. We closed on the secured revolver on July 24, 2015. The purpose of these loans is to facilitate growth through new construction in the Land Development and Construction segment and/or acquisition of existing, operating buildings to be added to the Asset Management segment.

During fiscal 2016, 2015 and 2014 the Company capitalized interest costs of $1,086,000, $1,041,000, and $1,763,000, respectively.

In January 2015 the Company prepaid the $1,314,000 remaining principal balance on 8.55% and 7.95% mortgages. The prepayment penalty of $116,000 is included in interest expense. The remaining deferred loan costs of $15,000 were also included in interest expense.

6. Leases.

At September 30, 2016, the total carrying value of property owned by the Company which is leased or held for lease to others is summarized as follows (in thousands):

Construction aggregates property	$	35,292
Commercial property		270,911
		306,203
less accumulated depreciation and depletion		79,479
	$	226,724

39 

The minimum future straight-lined rentals due the Company on noncancelable leases as of September 30, 2016 are as follows: 2017 - $24,265,000; 2018 - $20,779,000; 2019 - $15,278,000; 2020 - $13,381,000; 2021 - $10,536,000; 2022 and subsequent years $42,879,000.

7. Earnings per Share.

The following details the computations of the basic and diluted earnings per common share ( in thousands, except per share amounts):

	Years Ended September 30
	2016		2015		2014
Common shares:
Weighted average common shares
outstanding during the period -
shares used for basic earnings
per common share		9,846		9,756		9,629
Common shares issuable under share
based payment plans which are
potentially dilutive		44		71		81
Common shares used for diluted
earnings per common share		9,890		9,827		9,710
Income from continuing operations	$	12,024		6,093		5,184
Discontinued operations		—		2,179		4,835
Net income	$	12,024		8,272		10,019
Basic earnings per common share:
Income from continuing operations	$	1.22		.62		.54
Discontinued operations		—		.23		.50
Net income	$	1.22		.85		1.04
Diluted earnings per common share
Income from continuing operations	$	1.22		.62		.53
Discontinued operations		—		.22		.50
Net income	$	1.22		.84		1.03

For 2016, 2015 and 2014, 72,090, 56,110 and 31,790 shares, respectively, attributable to outstanding stock options were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.

8. Stock-Based Compensation Plans.

The Company has two Stock Option Plans (the 2000 Stock Option Plan and the 2006 Stock Option Plan) under which options for shares of common stock were granted to directors, officers and key employees. The 2006 plan permits the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, or stock awards. The options awarded under the plans have similar characteristics. All stock options are non-qualified and expire ten years from the date of grant. Stock based compensation awarded to directors, officers and employees are exercisable immediately or become exercisable in cumulative installments of 20% or 25% at the end of each year following the date of grant. When stock options are exercised the Company issues new shares after receipt of exercise proceeds and taxes

40 

due, if any, from the grantee. The number of common shares available for future issuance was 384,430 at September 30, 2016.

The Company utilizes the Black-Scholes valuation model for estimating fair value of stock compensation for options awarded to officers and employees. Each grant is evaluated based upon assumptions at the time of grant. The assumptions were no dividend yield, expected volatility between 36% and 46%, risk-free interest rate of .3% to 4.2% and expected life of 3.0 to 7.0 years.

The dividend yield of zero is based on the fact that the Company does not pay cash dividends and has no present intention to pay cash dividends. Expected volatility is estimated based on the Company’s historical experience over a period equivalent to the expected life in years. The risk-free interest rate is based on the U.S. Treasury constant maturity interest rate at the date of grant with a term consistent with the expected life of the options granted. The expected life calculation is based on the observed and expected time to exercise options by the employees.

As a result of the Spin-off and pursuant to the Employee Matters Agreement, we made certain adjustments to the exercise price and number of outstanding FRP stock options. All outstanding options held by the Company directors, Company officers and key employees on January 30, 2015 were cancelled and replaced by an equal number of FRP options at 75.14% of the previous exercise price based upon the market value of FRP less the when issued market value of the Company on that day. For FRP officers additional options were issued rather than issuing Patriot options for the 24.86% market value attributed to Patriot. The adjusted stock options are subject to the same vesting conditions and other terms that applied to the original FRP award immediately prior to the Spin-off, except as otherwise described above.

Subsequent to Spin-off, the realized tax benefit pertaining to options exercised and the remaining compensation cost of options previously granted prior to the Spin-off will be recognized by FRP or Patriot based on the employment location of the related employee or director.

The Company recorded the following stock compensation expense (including unallocated to Patriot in periods prior to the Spin-off) in its consolidated statement of income (in thousands):

	Years Ended September 30
	2016		2015		2014
Stock option grants	$	166		267		441
Annual director stock award		412		536		698
	$	578		803		1,139

A summary of changes in outstanding options is presented below (in thousands, except share and per share amounts):

				Weighted		Weighted		Weighted
	Number			Average		Average		Average
	of			Exercise		Remaining		Grant Date
Options	Shares			Price		Term (yrs)		Fair Value(000's)
Outstanding at
October 1, 2013		414,590		$	20.40		4.2	$	3,668
Granted		31,790		$	41.39			$	545
Exercised		(119,550	)	$	12.23			$	(732	)
Outstanding at
September 30, 2014		326,830		$	25.43		5.0	$	3,481
Spin-off adjustment								$	(865	)
Spin-off conversion		17,795		$	20.63			$	155
Granted		39,425		$	26.97			$	432
Forfeited		(6,000	)	$	14.97			$	(35	)
Exercised		(72,300	)	$	13.31			$	(430	)
Outstanding at
September 30, 2015		305,750		$	21.90		5.9	$	2,738
Granted		21,540		$	31.15			$	272
Exercised		(63,730	)	$	18.39			$	(471	)
Outstanding at
September 30, 2016		263,560		$	23.50		5.6	$	2,539
Exercisable at
September 30, 2016		185,713		$	22.30		4.7	$	1,621
Vested during
twelve months ended
September 30, 2016		35,596						$	341

41 

The following table summarizes information concerning stock options outstanding at September 30, 2016:

	Shares	Weighted			Weighted
Range of Exercise	under	Average			Average
Prices per Share	Option	Exercise Price			Remaining Life
Non-exercisable:
$16.51 – $24.75	5,539			16.72		5.2
$24.76 - $37.25	40,692			23.99		7.4
$37.26 - $41.39	31,616			31.13		8.2
	77,847		$	26.37		7.6	Years
Exercisable:
$16.51 - $24.75	19,756			16.72		5.2
$24.76 - $37.25	142,473			21.62		4.2
$37.26 - $41.39	23,484			31.11		7.7
	185,713		$	22.30		4.7	Years
Total	263,560		$	23.50		5.6	Years

The aggregate intrinsic value of exercisable in-the-money options was $1,630,000 and the aggregate intrinsic value of outstanding in-the-money options was $1,998,000 based on the market closing price of $31.07 on September 30, 2016 less exercise prices.

The realized tax benefit to the Company or Patriot from options exercised in the twelve months ended September 30, 2016 was $353,000. The unrecognized compensation cost of options granted to FRP employees but not yet vested as of September 30, 2016 was $322,000, which is expected to be recognized over a weighted-average period of 3.4 years. Gains of $913,000 were realized by option holders during the twelve months ended September 30, 2016.

9. Income Taxes.

The provision for income taxes for continuing operations for fiscal years ended September 30 consists of the following (in thousands):

		2016	2015	2014
Current:
Federal	$	4,807	1,803	2,820
State		1,165	524	1,083
		5,972	2,327	3,903
Deferred		1,879	1,568	(342	)
Total	$	7,851	3,895	3,561

A reconciliation between the amount of tax shown above and the amount computed at the statutory Federal income tax

42 

rate follows (in thousands):

		2016	2015		2014
Amount computed at statutory
Federal rate	$	6,797	3,396		3,020
State income taxes (net of Federal
income tax benefit)		1,002	504		520
Other, net		52	(5	)	21
Provision for income taxes	$	7,851	3,895		3,561

In this reconciliation, the category “Other, net” consists of changes in unrecognized tax benefits, permanent tax differences related to non-deductible expenses, special tax rates and tax credits, interest and penalties, and adjustments to prior year estimates.

The types of temporary differences and their related tax effects that give rise to deferred tax assets and deferred tax liabilities at September 30, are presented below (in thousands):

		2016	2015
Deferred tax liabilities:
Property and equipment	$	15,197	13,100
Depletion		526	496
Unrealized rents		1,823	1,881
Prepaid expenses		913	278
Gross deferred tax liabilities		18,459	15,755
Deferred tax assets:
Employee benefits and other		2,023	1,214
Gross deferred tax assets		2,023	1,214
Net deferred tax liability	$	16,436	14,541

The Company has no unrecognized tax benefits.

FRP tax returns in the U.S. and various states that include the Company are subject to audit by taxing authorities. As of September 30, 2016, the earliest tax year that remains open for audit in the Unites States is 2010.

10. Employee Benefits.

The Company and certain subsidiaries have a savings/profit sharing plan for the benefit of qualified employees. The savings feature of the plan incorporates the provisions of Section 401(k) of the Internal Revenue Code under which an eligible employee may elect to save a portion (within limits) of their compensation on a tax deferred basis. The Company contributes to a participant’s account an amount equal to 50% (with certain limits) of the participant’s contribution. Additionally, the Company may make an annual discretionary contribution to the plan as determined by the Board of Directors, with certain limitations. The plan provides for deferred vesting with benefits payable upon retirement or earlier termination of employment. The Company’s cost was $51,000 in 2016, $45,000 in 2015 and $40,000 in 2014.

The Company has a defined benefit pension plan, the Management Security Plan (MSP) for certain officers and key employees. The accruals for future benefits are based upon the remaining years to retirement of the participating employees and other actuarial assumptions. Life insurance on the lives of one of the participants has been purchased to partially fund this benefit and the Company is the owner and beneficiary of that policy. The expense for fiscal 2016, 2015 and 2014 was $161,000, $163,000 and $150,000, respectively. The accrued benefit under this plan as of September 30, 2016 and 2015 was $1,485,000 and $1,391,000 respectively.

43 

11. Business Segments.

Following the completion of the spin-off of the transportation business, management conducted a strategic review of the Company’s real estate operations.  As a result of this review, it was determined that the information that the Company’s chief operating decision makers regularly review for purposes of allocating resources and assessing performance, had changed. Therefore, beginning with the quarter ending March 31, 2015 (with prior periods adjusted accordingly), the Company is reporting its financial performance based on three reportable segments, Asset Management, Mining Royalty Lands and Land Development and Construction, as described below.

The Asset Management segment owns, leases and manages warehouse/office buildings located predominately in the Baltimore/Northern Virginia/Washington, DC market area.

Our Mining Royalty Lands segment remains unaffected and owns several properties comprising approximately 15,000 acres currently under lease for mining rents or royalties (this does not include the 4,280 acres owned in our Brooksville joint venture with Vulcan Materials).  Other than one location in Virginia, all of these properties are located in Florida and Georgia. 

Through our Land Development and Construction segment, we own and are continuously monitoring for their “highest and best use” several parcels of land that are in various stages of development.  Our overall strategy in this segment is to convert all of our non-income producing lands into income production through (i) an orderly process of constructing new warehouse/office buildings for us to own and operate or (ii) a sale to, or joint venture with, third parties.

Subsequent to the Spin-off, the Company is receiving certain services from Patriot (e.g. executive oversight, accounting, information technology and human resource services) which are billed to the Company on a monthly basis in accordance with the Transition Services Agreement entered into and made effective as of the date of the Spin-off. As was the case prior to the Spin-off, these costs (excluding stock compensation) are included in the Company’s corporate expense and are fully allocated to the business segments. Certain other corporate expenses (primarily stock compensation, corporate aircraft and one-time Spin-off related expenses) are reported as “unallocated” on the Company’s consolidated income statement and are not allocated to any business segment. As a result of the Spin-off the former transportation segment of the Company is reported as a discontinued operation and thus is not allowed any corporate overhead allocation. Hence, all corporate overhead of the transportation group through the date of the Spin-off is included in “corporate expense” on the Company’s consolidated income statements herein. Reclassifications to the appropriate prior period line items and amounts have been made to be comparable to the current presentation.

Operating results and certain other financial data for the Company’s business segments are as follows (in thousands):

		2016		2015		2014
Revenues:
Asset management	$	28,739		27,570		24,825
Mining royalty lands		7,533		6,094		5,349
Land development and construction		1,185		982		804
	$	37,457		34,646		30,978
Operating profit:
Before corporate expenses:
Asset management	$	13,374		13,288		11,703
Mining royalty lands		7,029		5,478		4,735
Land development and construction		(940	)	(2,197	)	(1,474	)
Corporate expenses:
Allocated to asset management		(1,591	)	(1,248	)	(958	)
Allocated to mining royalty		(231	)	(1,322	)	(1,016	)
Allocated to land development and construction		(1,258	)	(737	)	(565	)
Unallocated to discontinued operations		—		(1,081	)	(2,685	)
		(3,080	)	(4,388	)	(5,224	)
	$	16,383		12,181		9,740
Interest expense:
Asset management	$	1,561		2,014		1,366
Depreciation, depletion and amortization:
Asset management	$	7,689		6,963		6,384
Mining royalty lands		104		133		124
Land development and construction		258		282		197
	$	8,051		7,378		6,705
Capital expenditures:
Asset management	$	20,747		2,408		6,662
Mining royalty lands		205		—		—
Land development and construction		6,602		4,085		12,621
	$	27,554		6,493		19,283
Identifiable net assets at September 30:
Asset management	$	171,449		151,023		154,976
Mining royalty lands		39,570		39,300		39,368
Land development and construction		54,157		60,682		56,519
Discontinued operations		—		—		61,134
Cash items		—		419		1,074
Unallocated corporate assets		500		1,054		—
		265,676		252,478		313,071

44 

12. Fair Value Measurements.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. Level 1 means the use of quoted prices in active markets for identical assets or liabilities. Level 2 means the use of values that are derived principally from or corroborated by observable market data. Level 3 means the use of inputs are those that are unobservable and significant to the overall fair value measurement.

As of September 30, 2016 the Company had no assets or liabilities measured at fair value on a recurring or non-recurring basis. At September 30, 2016 and 2015, the carrying amount reported in the consolidated balance sheets for cash and cash equivalents, short-term notes payable and revolving credit approximate their fair value based upon the short-term nature of these items.

The fair values of the Company’s other mortgage notes payable were estimated based on current rates available to the Company for debt of the same remaining maturities. At September 30, 2016, the carrying amount and fair value of such other long-term debt was $42,819,000 and $46,216,000, respectively. At September 30, 2015, the carrying amount and fair value of such other long-term debt was $48,685,000 and $52,001,000, respectively.

13. Contingent Liabilities.

Certain of the Company’s subsidiaries are involved in litigation on a number of matters and are subject to certain claims which arise in the normal course of business. The Company has retained certain self-insurance risks with respect to

45 

losses for third party liability and property damage. The liability at any point in time depends upon the relative ages and amounts of the individual open claims. In the opinion of management, none of these matters are expected to have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows.

Preliminary testing on the site of the Company's four phase master development known as RiverFront on the Anacostia in Washington, D.C. indicated the presence of contaminated material that will have to be specially handled upon excavation in conjunction with construction. The Company has agreed with our joint venture partner to bear the cost of handling the contaminated materials on the first phase of this development up to a cap of $1.871 million. As of September 30, 2016, the excavation and foundation work for Phase 1 were substantially complete; thus, the bulk of the remediation expenses have been incurred. Management believes the total cost for remediation on Phase 1 will end up at approximately $1.9 million. During the quarter ending December 31, 2015, management successfully completed negotiations and entered into a $3,000,000 settlement of environmental claims on all four phases against our former tenant at the Riverfront on the Anacostia property and continues to pursue settlement negotiations with other potentially responsible parties. The Company executed a letter of intent with MRP Realty in May 2016 to develop Phase II of the Riverfront on the Anacostia project and recorded an estimated environmental remediation expense of $2.0 million for the Company’s estimated liability under the proposed agreement. The Company has no obligation to remediate this contamination on Phases III and IV of the development until such time as it makes a commitment to commence construction on each phase. The Company's position is that the prior tenant on the property is responsible for the cost of removal of the contaminated materials. The Company's actual expense to address this issue may be materially higher or lower than the expense previously recorded depending upon the actual costs incurred and any reimbursement that we receive from the prior tenant.

14. Commitments.

The Company, at September 30, 2016, had entered into various contracts to develop real estate with remaining commitments totaling $7,055,000.

15. Concentrations.

With the completion and occupancy of the 3rd build to suit for the same tenant at Patriot Business Park in the first quarter of fiscal 2015 this particular tenant accounted for 11% of the Company’s consolidated revenues during fiscal 2016. The mining royalty lands segment has a total of four tenants currently leasing mining locations and one lessee that accounted for 15.6% of the Company’s consolidated revenues in fiscal 2016 and $243,000 of accounts receivable at September 30, 2016. The termination of these lessees’ underlying leases could have a material adverse effect on the Company. The Company places its cash and cash equivalents with Tennessee Bank. At times, such amounts may exceed FDIC limits.

16. Unusual or Infrequent Items Impacting Quarterly Results.

In January 2015 the Company prepaid the $1,314,000 remaining principal balance on 8.55% and 7.95% mortgages. The prepayment penalty of $116,000 is included in interest expense. The remaining deferred loan costs of $15,000 were also included in interest expense.

Costs of operations for the land development and construction segment for the quarter ending December 31, 2015 includes a $3,000,000 positive benefit from settlement of environmental claims against our former tenant at the Riverfront on the Anacostia property (see Note 13).

Gain on investment land sold for the quarter ending December 31, 2015 includes $6,277,000 gain on the sale of phase 2 of Windlass Run residential property.

Costs of operations for the land development and construction segment for the quarter ending June 30, 2016 includes a $2,000,000 expense for estimated environmental remediation liability on Phase II of the Riverfront on the Anacostia property (see Note 13).

46 

17. Real Estate Business Park Acquisitions.

The Company has allocated the purchase price of the property acquisitions, through the use of a third party valuation, based upon the fair value of the assets acquired, consisting of land, buildings and intangible assets, including in-place leases and below market leases. Based on the third party valuation performed, the purchase price has been allocated to the fair value of the in-place leases, above market leases and below market leases.  These deferred leasing intangible assets are recorded within Deferred Costs and Deferred lease intangible, net in the consolidated balance sheets. The value of the in-place lease intangibles will be amortized to amortization expense over the remaining lease terms. The fair value assigned pertaining to the above market in-place leases values are amortized as a reduction to rental revenue, and the below market in-place lease values are amortized as an increase to rental revenue over the remaining non-cancelable terms of the respective leases.

TRANSIT BUSINESS PARK - On June 20, 2013, the Company purchased for approximately $8 million, Transit Business Park in Baltimore, Maryland which consists of 5 buildings on 14.5 acres totaling 232,318 square feet. The Company will recognize the amortization related to Transit Business Park intangible assets according to the following schedule (in thousands):

		In-place	Above Market	Below Market
		Leases	Leases	Leases
Initial Values	$	806	48	156
Annual Amortization:
2014		369	12	86
2015		63	4	37
2016		44	4	9
2017		44	4	—
2018		43	4	—
2019		43	4	—
2020		43	4	—
2021		17	3	—

KELSO BUSINESS PARK - On June 6, 2014, the Company purchased for approximately $4.8 million, the Kelso property in Baltimore, Maryland which consists of 2 buildings on 10.2 acres totaling 69,680 square feet. The Company will recognize the amortization related to Kelso Business Park intangible assets according to the following schedule (in thousands):

		In-place	Below Market
		Leases	Leases
Initial Values	$	579	64
Annual Amortization:
2014		80	8
2015		203	21
2016		136	21
2017		100	12
2018		28	2
2019		21	—
2020		11	—

PORT CAPITAL PROPERTY - On October 19, 2015, the Company purchased for approximately $9.9 million, 7700 Port Capital Drive in Elkridge, Maryland which consists of 1 building on 6.39 acres totaling 91,218 square feet plus approximately 29,558 square feet of mezzanine space. The Company will recognize the amortization related to the Port

47 

Capital Drive property intangible assets according to the following schedule (in thousands):

		In-place
		Leases
Initial Values	$	1,126
Annual Amortization:
2016	$	104
2017		114
2018		114
2019		114
2020		114
2021		114

GILROY ROAD PROPERTY – On July 1, 2016, the Company purchased for approximately $8.3 million, 10820 Gilroy Road in Hunt Valley, Maryland which consists of 1 building on 7 acres totaling 116,338 square feet inclusive of 8,900 square feet of second floor mezzanine office space (107,438 sf footprint). The Company will recognize the amortization related to the Port Capital Drive property intangible assets according to the following schedule (in thousands):

		In-place
		Leases
Initial Values	$	277
Annual Amortization:
2016	$	55
2017		222

18. Intangible Assets.

The Company reviews intangible assets for impairment, whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of long-lived assets is measured by a comparison of the carrying amount of the asset group to the future undiscounted net cash flows expected to be generated by those assets. If such assets are considered to be impaired, the impairment charge recognized is the amount by which the carrying amounts of the assets exceeds the fair value of the assets.

The gross amounts and accumulated amortization of identifiable intangible assets are as follows (in thousands):

	September 30, 2016				September 30, 2015
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
In-place leases (useful life 7-8 years)	$	2,788	$	1,175	$	1,385	$	836
Above Market leases (useful life 5 years)		48		23		48		19
	$	2,836	$	1,198	$	1,433	$	855

	September 30, 2016				September 30, 2015
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible liabilities:
Below Market leases (useful life 4-5 years)	$	220	$	206	$	220	$	176
	$	220	$	206	$	220	$	176

48 

Management's Report on Internal Control Over Financial Reporting

The management of FRP is responsible for establishing and maintaining adequate internal control over financial reporting. FRP's internal control system was designed to provide reasonable assurance to the Company's management and Board of Directors regarding the preparation and fair presentation of published financial statements in accordance with U.S. generally accepted accounting principles. All internal control systems, no matter how well designed have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. FRP's management assessed the effectiveness of the Company's internal control over financial reporting as of September 30, 2016 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in the Internal Control-Integrated Framework (2013). Based on this assessment, management believes that, as of September 30, 2016, the Company's internal control over financial reporting is effective.

Report of Independent Registered Certified Public Accounting Firm

The Shareholders and Board of Directors

FRP Holdings, Inc.

We have audited the accompanying consolidated balance sheets of FRP Holdings, Inc. as of September 30, 2016 and 2015, and the related consolidated statements of income, comprehensive income, shareholders’ equity, and cash flows for years ended September 30, 2016, 2015 and 2014. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of FRP Holdings, Inc. as of September 30, 2016 and 2015, and the consolidated results of its operations and its cash flows for the years ended September 30, 2016, 2015 and 2014 in conformity with accounting principles generally accepted in the United States of America.

49 

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of FRP Holdings, Inc.’s internal control over financial reporting as of September 30, 2016, based on criteria established in the Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, FRP Holdings, Inc. maintained, in all material respects, effective internal control over financial reporting as of September 30, 2016, based on criteria established in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Hancock Askew & Co., LLP

Savannah, Georgia

December 12, 2016

50 

DIRECTORS AND OFFICERS

Directors

Thompson S. Baker II (1)

President and Chief Executive

Officer of the Company

John D. Baker II (1)

Executive Chairman

Charles E. Commander III (2)(3)

Retired Partner

Foley & Lardner

H. W. Shad III (2)(4)

Owner, Bozard Ford Company

Martin E. Stein, Jr. (3)(4)

Chairman and Chief Executive Officer of

Regency Centers Corporation

William H. Walton (2)(3)(4)

President of Rockpoint Group LLC

_______________

(1) Member of the Executive Committee

(2) Member of the Audit Committee

(3) Member of the Compensation Committee

(4) Member of the Nominating Committee

Officers

John D. Baker II

Executive Chairman

Thompson S. Baker II

Chief Executive Officer

John D. Milton, Jr.

Executive Vice President, Treasurer, Secretary

and Chief Financial Officer

David H. deVilliers, Jr.

President

President, FRP Development Corp. and

Florida Rock Properties, Inc.

John D. Klopfenstein

Controller and Chief Accounting Officer

51 

FRP Holdings, Inc.

200 West Forsyth Street, 7th Floor

Jacksonville, Florida, 32202

Telephone: (904) 396-5733

Annual Meeting

Shareholders are cordially invited to attend the Annual Shareholders Meeting which will be held at 10 a.m. local time, on Wednesday, February 1, 2017, at The River Club, Ortega Room, on the 34^th floor of the Wells Fargo Building, One Independent Drive, Jacksonville, Florida.

Transfer Agent

American Stock Transfer & Trust Company

59 Maiden Lane

Plaza Level

New York, NY 10038

Telephone: 1-800-937-5449

General Counsel

Nelson Mullins Riley & Scarborough LLP

Jacksonville, Florida

Independent Registered Certified Public Accounting Firm

Hancock Askew & Co., LLP

Savannah, Georgia

Common Stock Listed

The Nasdaq Stock Market

(Symbol: FRPH)

Form 10-K

Shareholders may receive, without charge, a copy of FRP Holdings, Inc.’s annual report on Form 10-K for the fiscal year ended September 30, 2016 as filed with the Securities and Exchange Commission by writing to the Treasurer at 200 West Forsyth Street, 7th Floor, Jacksonville, Florida 32202. The most recent certifications by our Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 are filed as exhibits to our Form 10-K.

Company Website

The Company’s website may be accessed at www.frpholdings.com. All of our filings with the Securities and Exchange Commission can be accessed through our website promptly after filing. This includes annual reports on Form 10-K, proxy statements, quarterly reports on Form 10-Q, current reports filed or furnished on Form 8-K and all related amendments.

52 

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-55132, 333-125099 and 333-131475) of FRP Holdings, Inc. of our report dated December 12, 2016 relating to the consolidated financial statements and the effectiveness of FRP Holdings, Inc’s internal control over financial reporting which appears in the Annual Report to Shareholders incorporated by reference herein. We also consent to the incorporation by reference of our report dated December 12, 2016, relating to the financial statement schedule, which appears in this Form 10-K.

Hancock Askew & Co., LLP

Savannah, Georgia

December 12, 2016

EX-31

CERTIFICATIONS                                                                                                                  Exhibit 31(a)

I, Thompson S. Baker II, certify that:

1. I have reviewed this annual report on Form 10-K of FRP Holdings, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls to be designed under our supervision, ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosures controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal annual that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial report; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 12, 2016                                                       /s/Thompson S. Baker II

Thompson S. Baker II

Chief Executive Officer

EX-31

CERTIFICATIONS                                                                                                                 Exhibit 31(b)

I, John D. Milton, Jr., certify that:

1. I have reviewed this annual report on Form 10-K of FRP Holdings, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls to be designed under our supervision, ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosures controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal annual that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial report; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 12, 2016                                                       /s/John D. Milton, Jr.

John D. Milton, Jr.

Executive Vice President, Treasurer, Secretary and Chief Financial Officer

EX-31

CERTIFICATIONS                                                                                                                 Exhibit 31(c)

I, John D. Klopfenstein, certify that:

1. I have reviewed this annual report on Form 10-K of FRP Holdings, Inc.;

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls to be designed under our supervision, ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosures controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any changes in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal annual that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial report; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: December 12, 2016                                                      /s/John D. Klopfenstein

John D. Klopfenstein

Controller and Chief Accounting Officer

EX-32

                                                                                                                                                    Exhibit 32

CERTIFICATION UNDER SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned certifies that this periodic report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in this periodic report fairly presents, in all material respects, the financial condition and results of operations of FRP Holdings, Inc.

FRP HOLDINGS, INC.

December 12, 2016

/s/THOMPSON S. BAKER II

Thompson S. Baker II

Chief Executive Officer

/s/JOHN D. MILTON, JR.

John D. Milton, Jr.

Executive Vice President, Treasurer,

Secretary and Chief Financial Officer

/s/JOHN D. KLOPFENSTEIN

John D. Klopfenstein

Controller and Chief Accounting Officer

A signed original of this written statement required by Section 906 has been provided to FRP Holdings, Inc. and will be retained by FRP Holdings, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification accompanies the issuer’s Annual Report on Form 10-K and is not filed as provided in SEC Release Nos. 33-8212, 34-4751 and IC-25967, dated June 30, 2003.

XML

Document and Entity Information - USD ($)	12 Months Ended
	Sep. 30, 2016	Dec. 12, 2016	Mar. 31, 2016
Document And Entity Information
Entity Registrant Name	FRP HOLDINGS, INC.
Entity Central Index Key	0000844059
Document Type	10-K
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 269,324,902
Entity Common Stock, Shares Outstanding		9,881,415
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2016

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015
Assets:
Land	$ 99,357	$ 102,347
Buildings and improvements	193,283	174,820
Projects under construction	8,592	4,129
Total investments in properties	301,232	281,296
Less accumulated depreciation and depletion	80,616	74,091
Net investments in properties	220,616	207,205
Real estate held for investment, at cost	7,176	7,306
Real estate held for sale, at cost	0	4,826
Investment in joint ventures	23,854	19,010
Net real estate investments	251,646	238,347
Cash and cash equivalents	0	419
Accounts receivable	987	778
Federal and state income taxes receivable	0	393
Unrealized rents	4,657	4,817
Deferred costs	8,208	7,449
Other assets	178	275
Total assets	265,676	252,478
Liabilities:
Line of credit payable	6,807	8,494
Secured notes payable, current portion	4,455	4,180
Secured notes payable, less current portion	31,557	36,011
Accounts payable and accrued liabilities	4,344	3,456
Environmental remediation liability	2,037	51
Bank overdraft	6	0
Federal and state income taxes payable	13	0
Deferred revenue	1,423	1,060
Deferred income taxes	16,436	14,541
Deferred compensation	1,453	1,400
Deferred lease intangible, net	14	45
Tenant security deposits	1,032	898
Total liabilities	69,577	70,136
Commitments and contingencies (Note 13 & 14)
Equity:
Common stock, $.10 par value; 25,000,000 shares authorized, 9,867,279 and 9,791,770 shares issued and outstanding, respectively	987	979
Capital in excess of par value	51,606	49,872
Retained earnings	143,486	131,497
Accumulated other comprehensive income (loss), net	20	(6)
Total shareholders' equity	196,099	182,342
Total liabilities and shareholders' equity	$ 265,676	$ 252,478

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Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2016	Sep. 30, 2015
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.10	$ 0.10
Common stock, shares authorized	25,000,000	25,000,000
Common stock, shares issued and outstanding	9,867,279	9,791,770

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Consolidated Statements of Income - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Revenues:
Rental revenue	$ 24,457	$ 23,410	$ 21,327
Mining Royalty and rents	7,443	5,999	5,256
Revenue - reimbursements	5,557	5,237	4,395
Total revenues	37,457	34,646	30,978
Cost of operations:
Depreciation, depletion and amortization	8,051	7,378	6,705
Operating expenses	4,624	4,609	4,391
Environmental remediation expense (recovery)	(1,000)	0	0
Property taxes	4,475	4,443	3,494
Management company indirect	1,844	1,647	1,424
Corporate expenses (Note 4 Related Party)	3,080	4,388	5,224
Total cost of operations	21,074	22,465	21,238
Total operating profit	16,383	12,181	9,740
Interest income	2	0	23
Interest expense	(1,561)	(2,014)	(1,366)
Equity in loss of joint ventures	(978)	(145)	(128)
Gain (loss) on investment land sold	6,029	(34)	476
Income from continuing operations before income taxes	19,875	9,988	8,745
Provision for income taxes	7,851	3,895	3,561
Income from continuing operations	12,024	6,093	5,184
Gain from discontinued transportation operations, net of taxes	0	2,179	4,835
Net income	$ 12,024	$ 8,272	$ 10,019
Basic earnings per common share
Income from continuing operations	$ 1.22	$ 0.62	$ 0.54
Discontinued operations	0.00	0.23	0.50
Net income	1.22	0.85	1.04
Diluted earnings per common share
Income from continuing operations	1.22	0.62	0.53
Discontinued operations	0.00	0.22	0.50
Net income	$ 1.22	$ 0.84	$ 1.03
Number of shares (in thousands) used in computing:
-basic earnings per common share	9,846	9,756	9,629
-diluted earnings per common share	9,890	9,827	9,710

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Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Income Statement [Abstract]
Net income	$ 12,024	$ 8,272	$ 10,019
Other comp. income (loss) net of tax:
Spin-off adjustment	0	(53)	0
Actuarial loss retiree health	0	0	(2)
Minimum pension liability	26	7	4
Comprehensive income	$ 12,050	$ 8,226	$ 10,021

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Cash flows from operating activities:
Net income	$ 12,024	$ 8,272	$ 10,019
Adjustments to reconcile net income to net cash provided by continuing operating activities:
Income from discontinued operations, net	0	(2,179)	(4,835)
Depreciation, depletion and amortization	8,288	7,533	6,845
Deferred income taxes	1,895	1,572	(340)
Equity in loss of joint ventures	978	145	128
(Gain) loss on sale of equipment and property	(6,047)	138	(485)
Stock-based compensation	578	803	1,139
Net changes in operating assets and liabilities:
Accounts receivable	(209)	349	1,272
Deferred costs and other assets	(1,816)	(1,489)	(2,040)
Accounts payable and accrued liabilities	3,237	(2,024)	(718)
Income taxes payable and receivable	406	(965)	270
Other long-term liabilities	156	87	209
Net cash provided by operating activities of continuing operations	19,490	12,242	11,464
Net cash provided by operating activities of discontinued operations	0	4,984	11,890
Net cash provided by operating activities	19,490	17,226	23,354
Cash flows from investing activities:
Investments in properties	(27,554)	(6,493)	(19,283)
Investments in joint ventures	(929)	(625)	(5,266)
Cash held in escrow	0	61	1,508
Proceeds from the sale of real estate held for investment and properties	13,444	43	1,888
Net cash used in investing activities of continuing operations	(15,039)	(7,014)	(21,153)
Net cash used in investing activities of discontinued operations	0	(2,694)	(18,218)
Net cash used in investing activities	(15,039)	(9,708)	(39,371)
Cash flows from financing activities:
Increase in bank overdrafts	6	0	0
Repayment of long-term debt	(4,179)	(5,402)	(4,311)
Proceeds from borrowing on revolving credit facility	29,583	19,400	31,298
Payment on revolving credit facility	(31,270)	(21,269)	(20,935)
Debt issue costs	(139)	(397)	0
Repurchase of Company Stock	(43)	0	0
Excess tax benefits from exercises of stock options	0	175	1,047
Exercise of employee stock options	1,172	1,012	1,462
Net cash (used in) provided by financing activities of continuing operations	(4,870)	(6,481)	8,561
Net cash (used in) provided by financing activities of discontinued operations	0	(1,631)	7,967
Net cash (used in) provided by financing activities	(4,870)	(8,112)	16,528
Net (decrease) increase in cash and cash equivalents	(419)	(594)	511
Cash and cash equivalents at beginning of year	419	1,013	502
Cash and cash equivalents at end of the year	0	419	1,013
Supplemental disclosures of cash flow information:
Cash paid during the year for interest, net of capitalized amounts	1,538	2,335	1,475
Cash paid during the year for Income taxes	$ 5,565	$ 3,923	$ 6,180

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Shareholders Equity - USD ($) $ in Thousands	Common Stock	Capital in Excess of Par Value	Retained Earnings	Accumulated Other Comprehensive Income, net of tax	Total
Beginning balance, shares at Sep. 30, 2013	9,564,220
Beginning balance, amount at Sep. 30, 2013	$ 956	$ 44,258	$ 147,394	$ 38	$ 192,646
Exercise of stock options, shares	119,550				119,550
Exercise of stock options, amount	$ 12	1,450			$ 1,462
Excess tax benefits from exercises of stock options and vesting of restricted stock		1,047			1,047
Stock option compensation		441			441
Shares granted to Directors, shares	19,500
Shares granted to Directors, amount	$ 2	696			698
Net income			10,019		10,019
Minimum pension liability, net				4	4
Net actuarial loss retiree health, net				(2)	(2)
Ending balance, shares at Sep. 30, 2014	9,703,270
Ending balance, amount at Sep. 30, 2014	$ 970	47,892	157,413	40	$ 206,315
Exercise of stock options, shares	72,300				72,300
Exercise of stock options, amount	$ 7	1,005			$ 1,012
Excess tax benefits from exercises of stock options and vesting of restricted stock		174			174
Stock option compensation		267			267
Shares granted to Directors, shares	16,200
Shares granted to Directors, amount	$ 2	534			536
Spin-off adjustment			(34,188)	(53)	(34,241)
Net income			8,272		8,272
Minimum pension liability, net				7	7
Net actuarial loss retiree health, net					0
Ending balance, shares at Sep. 30, 2015	9,791,770
Ending balance, amount at Sep. 30, 2015	$ 979	49,872	131,497	(6)	$ 182,342
Exercise of stock options, shares	63,730				63,730
Exercise of stock options, amount	$ 7	1,165			$ 1,172
Stock option compensation		166			166
Shares granted to Directors, shares	13,200
Shares granted to Directors, amount	$ 1	411			412
Shares purchased and canceled, shares	(1,421)
Shares purchased and canceled, amount		(8)	(35)		(43)
Net income			12,024		12,024
Minimum pension liability, net				26	26
Net actuarial loss retiree health, net					0
Ending balance, shares at Sep. 30, 2016	9,867,279
Ending balance, amount at Sep. 30, 2016	$ 987	$ 51,606	$ 143,486	$ 20	$ 196,099

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Consolidated Real Estate and Accumulated Depreciation and Depletion

12 Months Ended

Sep. 30, 2016

Real Estate [Abstract]

Consolidated Real Estate and Accumulated Depreciation and Depletion

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED)-REAL ESTATE & ACCUMULATED DEPRECIATION AND

DEPLETION (dollars in thousands)

SEPTEMBER 30, 2016

County	Encumb- rances		Initial cost to Company		Cost capitalized subsequent to acquisition			Gross amount at which carried at end of period (a)		Accumulated Depreciation & Depletion		Year Of Constr- uction		Date Acquired		Depreciation Life Computed on:
Mining Royalty Lands
Alachua, FL			$	1,442	$	0		$	1,442	$	156		n/a		4/86	unit
Clayton, GA				369		0			369		5		n/a		4/86	unit
Fayette, GA				685		199			884		67		n/a		4/86	unit
Lake, FL				402		0			402		158		n/a		4/86	unit
Lake, FL				1,083		0			1,083		975		n/a		4/86	unit
Lake Louisa, FL				11,039		0			11,039		0		n/a		5/12	unit
Lee, FL				4,690		12			4,702		6		n/a		4/86	unit
Monroe, GA				792		0			792		288		n/a		4/86	unit
Muscogee, GA				369		(45	)		324		324		n/a		4/86	unit
Prince William, VA				298		0			298		298		n/a		4/86	unit
Putnam, FL				15,002		37			15,039		4,533		n/a		4/86	unit
Putnam, FL				302		(2	)		300		283		n/a		4/86	5 yr.
Spalding, GA				20		0			20		0		n/a		4/86	n/a
Marion, FL				1,180		4			1,184		599		n/a		4/86	unit
Investment Property				1,629		(101	)		1,528		691		n/a		4/86	n/a
		0		39,302		104			39,406		8,383
Asset Management Properties
Baltimore, MD		1,698		439		4,429			4,868		2,714		1990		10/89	39 yr.
Baltimore, MD		3,288		950		7,722			8,672		4,847		1994		12/91	39 yr.
Baltimore, MD		973		690		2,861			3,551		1,570		2000		07/99	39 yr.
Baltimore, MD		0		1,435		4,229			5,664		1,113		2008		12/02	39 yr.
Baltimore, MD		0		4,309		276			4,585		273		n/a		06/15	39 yr.
Baltimore, MD		0		8,412		521			8,933		54		1967		07/16	39 yr.
Baltimore City, MD		4,712		5,106		5,488			10,594		1,108		2016		12/10	39 yr.
Baltimore City, MD		0		7,442		1,869			9,311		1,070		n/a		6/13	39 yr.
Duval, FL		0		2,416		541			2,957		2,793		n/a		4/86	25 yr.
Harford, MD		486		31		3,830			3,861		2,181		1998		8/95	39 yr.
Harford, MD		1,377		50		5,709			5,759		2,605		1999		8/95	39 yr.
Harford, MD		2,646		85		7,091			7,176		3,677		2001		8/95	39 yr.
Harford, MD		2,148		88		10,133			10,221		4,379		2007		8/95	39 yr.
Harford, MD		1,506		155		12,627			12,782		4,401		2009		8/95	39 yr.
Howard, MD		0		2,859		4,887			7,746		4,369		1996		9/88	39 yr.
Howard, MD		879		2,473		1,046			3,519		1,480		2000		3/00	39 yr.
Elkridge, MD		0		8,920		27			8,947		355		TBD		10/15	39 yr.
Anne Arundel, MD		8,179		715		9,394			10,109		5,893		1989		9/88	39 yr.
Anne Arundel, MD		4,730		950		14,211			15,161		5,184		2003		5/98	39 yr.
Anne Arundel, MD		0		1,525		10,800			12,325		3,737		2005		8/04	39 yr.
Anne Arundel, MD		3,390		737		5,430			6,167		1,900		2006		1/03	39 yr.
Anne Arundel, MD		0		667		10,641			11,308		2,832		2012		7/07	39 yr.
Norfolk, VA		0		7,512		36			7,548		2,668		2004		10/04	39 yr.
Prince William, VA		0		7,039		24,078			31,117		2,582		2014		12/05	39 yr.
Newcastle Co., DE		0		11,559		2,959			14,518		4,736		2004		4/04	39 yr.
		36,012		76,564		150,835			227,399		68,521
Land Development and Construction Properties
Baltimore City, MD		0		988		3,826			4,814		106		n/a		12/10	15 yr.
Carroll, MD		0		4,720		2,340			7,060		0		n/a		3/08	n/a
Harford, MD		0		92		1,600			1,692		0		n/a		8/95	n/a
Prince William, VA		0		3,402		4,670			8,072		97		n/a		12/05	15 yr.
Washington D.C.		0		2,957		9,858			12,815		2,866		n/a		4/86	15 yr.
Washington D.C.		0		3,811		2,404			6,215		0		n/a		10/97	n/a
		0		15,970		24,698			40,668		3,069
GRAND TOTALS	$	36,012	$	131,836	$	175,637		$	307,473	$	79,973
(a) The aggregate cost for Federal income tax purposes is $269,546.

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED) - REAL ESTATE AND

ACCUMULATED DEPRECIATION AND DEPLETION

YEARS ENDED SEPTEMBER 30, 2016, 2015 AND 2014

(In thousands)

		2016			2015			2014
Gross Carrying Cost of Real Estate:
Balance at beginning of period	$	292,528		$	286,671		$	268,932
Additions during period:
Amounts capitalized		27,439			6,063			19,154
Deductions during period:
Cost of real estate sold		(5,011	)		—			(1,415	)
Other		(7,483	) (1)		(206	)		—
Balance at close of period	$	307,473		$	292,528		$	286,671
Accumulated Depreciation & Depletion:
Balance at beginning of period	$	73,480		$	67,598		$	62,167
Additions during period:
Charged to cost & expense		6,690			5,902			5,446
Deductions during period:
Real estate sold		—			—			(15	)
Other		(197	)		(20	)		—
Balance at close of period	$	79,973		$	73,480		$	67,598
(1) Includes $6,828 of property cost transferred to Investment in Joint Ventures for the joint venture partnership with St. John Properties.

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Accounting Policies

12 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Accounting Policies

1. Accounting Policies.

ORGANIZATION - FRP Holdings, Inc. (“FRP” or the “Company”) is a holding company engaged in the real estate business, namely (i) warehouse/office building ownership, leasing and management, (ii) mining royalty land ownership and leasing and (iii) land acquisition, entitlement and development primarily for future warehouse/office building construction. On January 30, 2015, FRP completed the tax-free Spin-off (“Spin-off”) of its transportation business into a new, separately traded public company, Patriot Transportation Holding, Inc. (Nasdaq GM: PATI) (“Patriot”). In the Spin-off, FRP distributed all of the outstanding stock of Patriot to FRP's shareholders as of the record date of January 9, 2015. FRP’s shareholders received one share of Patriot for every three shares of FRP owned on the record date. Patriot now is an independent, publicly traded company, and FRP retains no ownership in Patriot. The Company retained the real estate business, which is now the sole business of the Company. See Note 3 regarding more information regarding the spin-off.

FRP Holdings, Inc. was incorporated on April 22, 2014 in connection with a corporate reorganization that preceded the Spin-off. The Company’s successor issuer was formed on July 20, 1998. The business of the Company is conducted through our wholly-owned subsidiaries FRP Maryland, Inc., a Maryland corporation, FRP Development Corp., a Maryland corporation and Florida Rock Properties, Inc., a Florida corporation, and the various subsidiaries of each.

CONSOLIDATION - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Investments in the Brooksville joint venture, BC FRP Realty joint venture and Riverfront Investment Partners I, LLC are accounted for under the equity method of accounting (See Note 2). All significant intercompany transactions have been eliminated in consolidation.

CASH AND CASH EQUIVALENTS - The Company considers all highly liquid debt instruments with maturities of three months or less at time of purchase to be cash equivalents. Bank overdrafts consist of outstanding checks not yet presented to a bank for settlement, net of cash held in accounts with right of offset.

REVENUE AND EXPENSE RECOGNITION - Real estate rental revenue and mining royalties are generally recognized when earned under the leases and are considered collectable. Rental income from leases with scheduled increases or other incentives during their term is recognized on a straight-line basis over the term of the lease. Reimbursements of expenses, when provided in the lease, are recognized in the period that the expenses are incurred.

Sales of real estate are recognized when the collection of the sales price is reasonably assured and when the Company has fulfilled substantially all of its obligations, which are typically as of the closing date.

Accounts receivable are recorded net of discounts and provisions for estimated allowances. We estimate allowances on an ongoing basis by considering historical and current trends. We record estimated bad debts expense as part of operating expenses. We estimate the net collectibility of our accounts receivable and establish an allowance for doubtful accounts based upon this assessment. Specifically, we analyze the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms.

PROPERTY AND EQUIPMENT - Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

	Years
Building and improvements	3-39

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves. Reserve estimates are periodically adjusted based upon surveys.

The Company recorded depreciation and depletion expenses for 2016, 2015 and 2014 of $6,809,000, $6,195,000, and $5,528,000, respectively.

All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property. Included in indirect costs is an allocation of internal costs associated with development of real estate investments. The cost of routine repairs and maintenance to property and equipment is expensed as incurred.

IMPAIRMENT OF LONG-LIVED ASSETS – The Company periodically reviews its long-lived assets, which include property and equipment and purchased intangible assets subject to amortization for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. This review consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures.

DEVELOPED PROPERTY RENTALS PURCHASE ACCOUNTING – Acquisitions of rental property, including any associated intangible assets, are measured at fair value at the date of acquisition. Any liabilities assumed or incurred are recorded at their fair value at the time of acquisition. The fair value of the acquired property is allocated between land and building (on an as-if vacant basis) based on management’s estimate of the fair value of those components for each type of property and to tenant improvements based on the depreciated replacement cost of the tenant improvements, which approximates their fair value. The fair value of the in-place leases is recorded as follows:

· the fair value of leases in-place on the date of acquisition is based on absorption costs for the estimated lease-up period in which vacancy and foregone revenue are avoided due to the presence of the acquired leases;

· the fair value of above and below-market in-place leases based on the present value (using a discount rate that reflects the risks associated with the acquired leases) of the difference between contractual rent amounts to be paid under the assumed lease and the estimated market lease rates for the corresponding spaces over the remaining non-cancelable terms of the related leases; and

· the fair value of intangible tenant or customer relationships.

The Company’s determination of these fair values requires it to estimate market rents for each of the leases and make certain other assumptions. These estimates and assumptions affect the rental revenue, and depreciation and amortization expense recognized for these leases and associated intangible assets and liabilities.

INVESTMENTS - The Company uses the equity method to account for its investment in Brooksville, in which it has a voting interest of 50% and has significant influence but does not have control. The Company uses the equity method to account for its investment in BC FRP Realty, in which it has a voting interest of 50%. The Company uses the equity method to account for its investment in RiverFront Investment Partners I, LLC, in which the equity interest will be determined based on leverage of the entity, additional cash contributions by the Company, and negotiations with potential third partners. Under the equity method, the investment is originally recorded at cost and adjusted to recognize the Company’s share of net earnings or losses of the investee, limited to the extent of the Company’s investment in and advances to the investee and financial guarantees on behalf of the investee that create additional basis. The Company regularly monitors and evaluates the realizable value of its investments. When assessing an investment for an other-than-temporary decline in value, the Company considers such factors as, the performance of the investee in relation to its own operating targets and its business plan, the investee’s revenue and cost trends, as well as liquidity and cash position, and the outlook for the overall industry in which the investee operates. From time to time, the Company may consider third party evaluations or valuation reports. If events and circumstances indicate that a decline in the value of these assets has occurred and is other-than-temporary, the Company records a charge to investment income (expense).

INCOME TAXES - Deferred tax assets and liabilities are recognized based on differences between financial statement and tax bases of assets and liabilities using presently enacted tax rates. Deferred income taxes result from temporary differences between pre-tax income reported in the financial statements and taxable income. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination of the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of limitations, effectively settled issues under audit, and audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. It is the Company's policy to recognize as additional income tax expense the items of interest and penalties directly related to income taxes.

STOCK BASED COMPENSATION – The Company accounts for compensation related to share based plans by recognizing the grant date fair value of stock options and other equity-based compensation issued to employees in its income statement over the requisite employee service period using the straight-line attribution model. In addition, compensation expense must be recognized for the change in fair value of any awards modified, repurchased or cancelled after the grant date. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used in the model and current year impact are discussed in Note 8.

PENSION PLAN - The Company accounts for its pension plan following the requirements of FASB ASC Topic 715, “Compensation – Retirement Benefits”, which requires an employer to: (a) recognize in its statement of financial position the funded status of a benefit plan; (b) measure defined benefit plan assets and obligations as of the end of the employer's fiscal year (with limited exceptions); and (c) recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise but are not recognized as components of net periodic benefit costs pursuant to prior existing guidance.

EARNINGS PER COMMON SHARE - Basic earnings per common share are based on the weighted average number of common shares outstanding during the periods. Diluted earnings per common share are based on the weighted average number of common shares and potential dilution of securities that could share in earnings. The differences between basic and diluted shares used for the calculation are the effect of employee and director stock options and restricted stock.

USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United State requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain accounting policies and estimates are of more significance in the financial statement preparation process than others. The most critical accounting policies and estimates include the economic useful lives of our property and equipment, provisions for uncollectible accounts receivable and collectibility of unrealized rents, estimates of exposures related to our insurance claims plans, and estimates for taxes. To the extent that actual, final outcomes are different than these estimates, or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting period will be affected.

ENVIRONMENTAL - Environmental expenditures that benefit future periods are capitalized. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded for the estimated amount of expected environmental assessments and/or remedial efforts. Estimation of such liabilities includes an assessment of engineering estimates, continually evolving governmental laws and standards, and potential involvement of other potentially responsible parties.

COMPREHENSIVE INCOME – Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) refers to expenses, gains, and losses that are not included in net income, but rather are recorded directly in shareholders’ equity.

RECENTLY ISSUED ACCOUNTING STANDARDS – In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes”. The guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. The guidance becomes effective for annual reporting periods beginning after December 15, 2016 with early adoption permitted. The Company adopted this guidance retrospectively as of October 1, 2015 and reclassified $143,000 from deferred costs to long-term deferred tax liability.

In February 2016, the FASB issued ASU No. 2016-02, “Leases”, which requires lessees to recognize a right-to-use asset and a lease obligation for all leases. Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less. Additional qualitative and quantitative disclosures, including significant judgments made by management, will be required. Lessors will account for leases using an approach that is substantially equivalent to existing accounting standards. The new standard will become effective for the Company beginning with the first quarter 2020 and requires a modified retrospective transition approach and includes a number of practical expedients. Early adoption of the standard is permitted. As the Company is primarily a lessor the adoption of this guidance is not expected to have a material impact on its financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. Excess tax benefits for share-based payments will be recorded as a reduction of income taxes and reflected in operating cash flows upon the adoption of this ASU. Excess tax benefits are currently recorded in equity and as financing activity under the current rules. In addition, the guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2016 with early adoption permitted. The Company may early adopt this accounting guidance in fiscal 2017 or as required in fiscal 2018.

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Investments in Joint Ventures

12 Months Ended

Sep. 30, 2016

Equity Method Investments and Joint Ventures [Abstract]

Investments in Joint Ventures

2. Investments in Joint Ventures.

RiverFront. On March 30, 2012 the Company entered into a Contribution Agreement with MRP SE Waterfront Residential, LLC. (“MRP”) to form a joint venture to develop the first phase only of the four phase master development known as RiverFront on the Anacostia in Washington, D.C. The purpose of the Joint Venture is to develop, own, lease and ultimately sell an approximately 300,000 square foot residential apartment building (including approximately 18,000 square feet of retail) on approximately 2 acres of the roughly 5.82 acre site. The joint venture, RiverFront Investment Partners I, LLC (“RiverFront I”) was formed in June 2013 as contemplated. The Company contributed land with an agreed to value of $13,500,000 (cost basis of $6,165,000) and contributed cash of $4,866,000 to the Joint Venture for a 76.91% stake in the venture. MRP contributed capital of $5,553,000 to the joint venture including development costs paid prior to formation of the joint venture. The Joint Venture closed on $17,000,000 of EB5 secondary financing and a nonrecourse construction loan for $65,000,000 on August 8, 2014. Both these financing sources are non-recourse to FRP. At the time of these financings, RiverFront Holdings I, LLC. was formed as a parent to RiverFront Investment Partners I, LLC with EB5 as an equity partner in Riverfront Holdings I, LLC. Construction commenced in October 2014. At this point, the Company anticipates lease up to occur in the second half of calendar 2016 and all of 2017. The Company’s equity interest in the joint venture is accounted for under the equity method of accounting as MRP acts as the administrative agent of the joint venture and oversees and controls the day to day operations of the project.

Other income for fiscal 2016 includes a loss of $938,000 representing the Company’s portion of the loss of this joint venture due primarily to expenses incurred in the joint venture with respect to real estate taxes, advertising expense, depreciation on the bulkhead, and audit fees.

Brooksville. In 2006, the Company entered into a Joint Venture Agreement with Florida Rock Industries, Inc. (now owned by Vulcan Materials Company) to jointly own and develop approximately 4,300 acres of land near Brooksville, Florida. Under the terms of the joint venture, FRP contributed its fee interest in approximately 3,443 acres formerly leased to Vulcan under a long-term mining lease which had a net book value of $2,548,000. Vulcan is entitled to mine a portion of the property until 2022 and pay royalties to the Company. FRP also contributed $3,018,000 for one-half of the acquisition costs of a 288-acre contiguous parcel. Vulcan contributed 553 acres that it owned as well as its leasehold interest in the 3,443 acres that it leased from FRP and $3,018,000 for one-half of the acquisition costs of the 288-acre contiguous parcel. The joint venture is jointly controlled by Vulcan and FRP, and they each have a mandatory obligation to fund additional capital contributions of up to $2,430,000. Capital contributions of $2,397,000 have been made by each party as of September 30, 2016. Distributions will be made on a 50-50 basis except for royalties and depletion specifically allocated to the Company. Other income for fiscal 2016 includes a loss of $40,000 representing the Company’s portion of the loss of this joint venture. In April 2011, the Florida Department of Community Affairs issued its Final Order approving the development of the Project, and zoning for the Project was obtained from Hernando County in August 2012. We will continue to monitor the residential market in Hernando County and pursue opportunities to partner with a master community developer or major homebuilder to commence construction when the market dictates.

BC FRP Realty (Windlass Run). During the 2nd quarter, we entered into an agreement with a substantial Baltimore development company (St. John Properties, Inc.) to jointly develop the remaining lands of our Windlass Run Business Park. The 50/50 partnership initially calls for FRP to combine its 25 acres (valued at $7,500,000) with St. John Properties’ adjacent 10 acres fronting on a major state highway (valued at $3,239,536) which resulted in an initial cash distribution of $2,130,232 to FRP in May, 2016. Thereafter, the venture will jointly develop the combined properties into a multi-building business park to consist of approximately 329,000 square feet of single story office space.

Investments in Joint Ventures (in thousands):

							The
							Company's
				Total Assets	Net Loss		Share of Net
			Total	of the	of the		Loss of the
	Ownership		Investment	Partnership	Partnership		Partnership
As of September 30, 2016
RiverFront Holdings I, LLC	77.14	%	$  11,261	$  85,106	$   (1,193	)	$   (938	)
Brooksville Quarry, LLC	50.00	%	7,496	14,350	(80	)	(40	)
BC FRP Realty, LLC	50.00	%	5,097	10,573
Total			$  23,854	$ 110,029	$  (1,273	)	$  (978	)
As of September 30, 2015
RiverFront Holdings I, LLC	76.91	%	$  11,517	$  40,970	$   (108	)	$   (105	)
Brooksville Quarry, LLC	50.00	%	7,493	14,336	(80	)	(40	)
Total			$  19,010	$  55,306	$  (188	)	$  (145	)

Summarized Financial Information for the Investments in Joint Ventures (in thousands):

	As of September 30, 2016
	Riverfront		Brooksville		BCF FRP
	Holdings I, LLC		Quarry, LLC		Realty, LLC		Total
Cash	$	297	$	35	$	20	$	352
Cash held in escrow		13		—		—		13
Amortizable Debt Costs		1,179		—		—		1,179
Investments in real estate, net		83,617		14,315		10,553		108,485
Total Assets	$	85,106	$	14,350	$	10,573	$	110,029
Other Liabilities	$	5,140	$	65	$	17	$	5,222
Long-term Debt		63,495		—		—		63,495
Capital - FRP		11,261		7,496		5,097		23,854
Capital - Third Parties		5,210		6,789		5,459		17,458
Total Liabilities and Capital	$	85,106	$	14,350	$	10,573	$	110,029

	As of September 30, 2015
	Riverfront		Brooksville
	Holdings I, LLC		Quarry, LLC		Total
Cash	$	47	$	14	$	61
Cash held in escrow		3,420		—		3,420
Amortizable Debt Costs		1,593		—		1,593
Investments in real estate, net		35,910		14,322		50,232
Total Assets	$	40,970	$	14,336	$	55,306
Other Liabilities	$	6,905	$	64	$	6,969
Long-term Debt		17,000		—		17,000
Capital - FRP		11,517		7,493		19,010
Capital - Third Parties		5,548		6,779		12,327
Total Liabilities and Capital	$	40,970	$	14,336	$	55,306

Income statements for the RiverFront Holdings I, LLC (in thousands):

	Years Ended September 30,
	2016			2015			2014
Revenue	$	127			—			—
Cost of operations		1,040			108			89
Operating profit		(913	)		(108	)		(89	)
Interest expense		(280	)		—			—
Net loss of the Partnership	$	(1,193	)		(108	)		(89	)

The amount of consolidated retained earnings for these joint ventures was $(990,000) and $(389,000) as of September 30, 2016 and 2015 respectively.

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Spin-off

12 Months Ended

Sep. 30, 2016

Notes to Financial Statements

Spin-off

3. Spin-off.

On January 30, 2015, FRP Holdings, Inc. (Nasdaq GM: FRPH) (the “Company” or “FRP”) completed the spin-off of its transportation business into a new, separately traded public company - Patriot Transportation Holding, Inc. (Nasdaq GM: PATI) (“Patriot”) - resulting in FRP becoming a pure real estate company. As a result, the former transportation segment is reported as a discontinued operation without any corporate overhead allocation. Hence, all corporate overhead attributable to the transportation group through the date of the spin-off is included in “corporate expense” on the Company’s historical consolidated income statements.

The results of operations associated with discontinued operations were as follows (in thousands):

	Years Ended September 30,
	2016		2015			2014
Revenue	$	—		41,800			129,162
Cost of operations		—		38,195			121,134
Operating profit		—		3,605			8,028
Interest expense		—		(33	)		(102	)
Income before income taxes		—		3,572			7,926
Provision for income taxes		—		1,393			3,091
Income from discontinued operations	$	—		2,179			4,835

The following table presents the carrying value of the major categories of assets and liabilities of discontinued operations reflected on the Company’s consolidated balance sheets at September 30, 2014:

Property and  equipment, net	$	42,174
Accounts receivable, net		7,119
Deferred costs		11,809
Other assets		32
Assets of discontinued operation	$	61,134
Line of credit	$	7,282
Accounts payable and accrued liabilities		11,489
Deferred compensation		717
Deferred income taxes		8,924
Liabilities of discontinued operation	$	28,412

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Related Party Transactions

12 Months Ended

Sep. 30, 2016

Related Party Transactions [Abstract]

Related Party Agreements with Patriot

4. Related Party Transactions.

In order to effect the Spin-off and govern our relationship with Patriot Transportation Holding, Inc. after the Spin-off, we entered into an Employee Matters Agreement and a Transition Services Agreement. The Employee Matters Agreement generally allocates responsibilities to each company for liabilities relating to each Company’s current and former employees and allocated responsibilities under employee benefit plans. The Transition Services Agreement sets forth the terms on which Patriot will provide to FRP certain services that were shared prior to the Spin-off, including the services of certain shared executive officers, for a period of 12 or more months after the Spin-off. The boards of the respective companies have since extended these agreements for an additional twelve months.

The consolidated statements of income reflect charges and/or allocation from Patriot for these services of $1,542,000, $2,211,000, and $2,539,000 for fiscal 2016, 2015 and 2014, respectively. Included in the charges above are amounts recognized for corporate executive stock-based compensation expense. These charges are reflected as part of corporate expenses.

To determine these allocations between FRP and Patriot as set forth in the Transition Services Agreement, we generally employed the same methodology historically used by the Company pre Spin-off to allocate said expenses and thus we believe that the allocations to FRP are a reasonable approximation of the costs related to FRP’s operations but any such related-party transactions cannot be presumed to be carried out on an arm’s-length basis as the terms were negotiated while Patriot was still a subsidiary of FRP.

As a result of the Spin-off the former transportation segment of the Company is reported as a discontinued operation and thus is not allowed any corporate overhead allocation. Hence, all corporate overhead of the transportation group through the date of the Spin-off is included in “corporate expense” on the Company’s consolidated income statements. The consolidated statements of income reflect charges and/or allocation for these services of $1,081,000 and $2,685,000 for fiscal 2015 and 2014, respectively.

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Debt

12 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Debt

5. Debt.

Debt at September 30 is summarized as follows (in thousands):

	2016		2015
Revolving credit agreements	$	6,807		8,494
5.6% to 7.9% mortgage notes
due in installments through 2027		36,012		40,191
		42,819		48,685
Less portion due within one year		4,455		4,180
	$	38,364		44,505

The aggregate amount of principal payments, excluding the revolving credit, due subsequent to September 30, 2016 is: 2017 - $4,455,000; 2018 – $4,673,000; 2019 - $3,885,000; 2020 - $3,725,000; 2021 - $3,485,000 and subsequent years - $15,789,000.

The non-recourse fully amortizing mortgage notes payable are collateralized by real estate having a carrying value of approximately $45,478,000 at September 30, 2016.

On January 30, 2015, in connection with the Spin-off, the Company terminated its $55 million credit facility entered into with Wells Fargo Bank, N.A. in 2012 and simultaneously entered into a new five year credit agreement with Wells Fargo with a maximum facility amount of $20 million (the "Credit Agreement"). The Credit Agreement provides a revolving credit facility (the “Revolver”) with a $10 million sublimit available for standby letters of credit. At the time of the Spin-off, the Company refinanced $10,483,000 of borrowings then outstanding on the terminated revolver. As of September 30, 2016, there was $5,765,000 outstanding on the revolver, $2,442,000 outstanding under letters of credit and $11,793,000 available for borrowing. The letters of credit were issued to guarantee certain obligations to state agencies related to real estate development. Most of the letters of credit are irrevocable for a period of one year and typically are automatically extended for additional one-year periods. The Revolver bears interest at a rate of 1.4% over the selected LIBOR, which may change quarterly based on the Company’s ratio of Consolidated Total Debt to Consolidated Total Capital, as defined. A commitment fee of 0.15% per annum is payable quarterly on the unused portion of the commitment. The commitment fee may also change quarterly based upon the ratio described above. The credit agreement contains certain conditions and financial covenants, including a minimum $110 million tangible net worth. As of September 30, 2016, the tangible net worth covenant would have limited our ability to pay dividends or repurchase stock with borrowed funds to a maximum of $73 million combined. The Company was in compliance with all covenants as of September 30, 2016.

During the first quarter of fiscal 2015, the Company announced the execution of a commitment from First Tennessee Bank to provide up to $40 million dollars of mortgage backed financing in two separate facilities. On July 24, 2015 the Company closed on a five year, $20 million secured revolver with a twenty-four month window to convert up to the full amount of the facility into a ten year term loan. Interest accrues at 1.90% over one month LIBOR plus an annual commitment fee of 0.10%. As of September 30, 2016, there was $1,042,000 outstanding on the revolver and $18,958,000 available for borrowing. The second facility is a $20 million ten year term loan secured by to-be-determined collateral from our current pool of unencumbered warehouse/office properties. We closed on the secured revolver on July 24, 2015. The purpose of these loans is to facilitate growth through new construction in the Land Development and Construction segment and/or acquisition of existing, operating buildings to be added to the Asset Management segment.

During fiscal 2016, 2015 and 2014 the Company capitalized interest costs of $1,086,000, $1,041,000, and $1,763,000, respectively.

In January 2015 the Company prepaid the $1,314,000 remaining principal balance on 8.55% and 7.95% mortgages. The prepayment penalty of $116,000 is included in interest expense. The remaining deferred loan costs of $15,000 were also included in interest expense.

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Leases

12 Months Ended

Sep. 30, 2016

Leases [Abstract]

Leases

6. Leases.

At September 30, 2016, the total carrying value of property owned by the Company which is leased or held for lease to others is summarized as follows (in thousands):

Construction aggregates property	$	35,292
Commercial property		270,911
		306,203
less accumulated depreciation and depletion		79,479
	$	226,724

The minimum future straight-lined rentals due the Company on noncancelable leases as of September 30, 2016 are as follows: 2017 - $24,265,000; 2018 - $20,779,000; 2019 - $15,278,000; 2020 - $13,381,000; 2021 - $10,536,000; 2022 and subsequent years $42,879,000.

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Earnings Per Share

12 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Earnings Per Share

7. Earnings per Share.

The following details the computations of the basic and diluted earnings per common share ( in thousands, except per share amounts):

	Years Ended September 30
	2016		2015		2014
Common shares:
Weighted average common shares
outstanding during the period -
shares used for basic earnings
per common share		9,846		9,756		9,629
Common shares issuable under share
based payment plans which are
potentially dilutive		44		71		81
Common shares used for diluted
earnings per common share		9,890		9,827		9,710
Income from continuing operations	$	12,024		6,093		5,184
Discontinued operations		—		2,179		4,835
Net income	$	12,024		8,272		10,019
Basic earnings per common share:
Income from continuing operations	$	1.22		.62		.54
Discontinued operations		—		.23		.50
Net income	$	1.22		.85		1.04
Diluted earnings per common share
Income from continuing operations	$	1.22		.62		.53
Discontinued operations		—		.22		.50
Net income	$	1.22		.84		1.03

For 2016, 2015 and 2014, 72,090, 56,110 and 31,790 shares, respectively, attributable to outstanding stock options were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.

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Stock-Based Compensation Plans

12 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation Plans

8. Stock-Based Compensation Plans.

The Company has two Stock Option Plans (the 2000 Stock Option Plan and the 2006 Stock Option Plan) under which options for shares of common stock were granted to directors, officers and key employees. The 2006 plan permits the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, or stock awards. The options awarded under the plans have similar characteristics. All stock options are non-qualified and expire ten years from the date of grant. Stock based compensation awarded to directors, officers and employees are exercisable immediately or become exercisable in cumulative installments of 20% or 25% at the end of each year following the date of grant. When stock options are exercised the Company issues new shares after receipt of exercise proceeds and taxes due, if any, from the grantee. The number of common shares available for future issuance was 384,430 at September 30, 2016.

The Company utilizes the Black-Scholes valuation model for estimating fair value of stock compensation for options awarded to officers and employees. Each grant is evaluated based upon assumptions at the time of grant. The assumptions were no dividend yield, expected volatility between 36% and 46%, risk-free interest rate of .3% to 4.2% and expected life of 3.0 to 7.0 years.

The dividend yield of zero is based on the fact that the Company does not pay cash dividends and has no present intention to pay cash dividends. Expected volatility is estimated based on the Company’s historical experience over a period equivalent to the expected life in years. The risk-free interest rate is based on the U.S. Treasury constant maturity interest rate at the date of grant with a term consistent with the expected life of the options granted. The expected life calculation is based on the observed and expected time to exercise options by the employees.

As a result of the Spin-off and pursuant to the Employee Matters Agreement, we made certain adjustments to the exercise price and number of outstanding FRP stock options. All outstanding options held by the Company directors, Company officers and key employees on January 30, 2015 were cancelled and replaced by an equal number of FRP options at 75.14% of the previous exercise price based upon the market value of FRP less the when issued market value of the Company on that day. For FRP officers additional options were issued rather than issuing Patriot options for the 24.86% market value attributed to Patriot. The adjusted stock options are subject to the same vesting conditions and other terms that applied to the original FRP award immediately prior to the Spin-off, except as otherwise described above.

Subsequent to Spin-off, the realized tax benefit pertaining to options exercised and the remaining compensation cost of options previously granted prior to the Spin-off will be recognized by FRP or Patriot based on the employment location of the related employee or director.

The Company recorded the following stock compensation expense (including unallocated to Patriot in periods prior to the Spin-off) in its consolidated statement of income (in thousands):

	Years Ended September 30
	2016		2015		2014
Stock option grants	$	166		267		441
Annual director stock award		412		536		698
	$	578		803		1,139

A summary of changes in outstanding options is presented below (in thousands, except share and per share amounts):

				Weighted		Weighted		Weighted
	Number			Average		Average		Average
	of			Exercise		Remaining		Grant Date
Options	Shares			Price		Term (yrs)		Fair Value(000's)
Outstanding at
October 1, 2013		414,590		$	20.40		4.2	$	3,668
Granted		31,790		$	41.39			$	545
Exercised		(119,550	)	$	12.23			$	(732	)
Outstanding at
September 30, 2014		326,830		$	25.43		5.0	$	3,481
Spin-off adjustment								$	(865	)
Spin-off conversion		17,795		$	20.63			$	155
Granted		39,425		$	26.97			$	432
Forfeited		(6,000	)	$	14.97			$	(35	)
Exercised		(72,300	)	$	13.31			$	(430	)
Outstanding at
September 30, 2015		305,750		$	21.90		5.9	$	2,738
Granted		21,540		$	31.15			$	272
Exercised		(63,730	)	$	18.39			$	(471	)
Outstanding at
September 30, 2016		263,560		$	23.50		5.6	$	2,539
Exercisable at
September 30, 2016		185,713		$	22.30		4.7	$	1,621
Vested during
twelve months ended
September 30, 2016		35,596						$	341

The following table summarizes information concerning stock options outstanding at September 30, 2016:

	Shares	Weighted			Weighted
Range of Exercise	under	Average			Average
Prices per Share	Option	Exercise Price			Remaining Life
Non-exercisable:
$16.51 – $24.75	5,539			16.72		5.2
$24.76 - $37.25	40,692			23.99		7.4
$37.26 - $41.39	31,616			31.13		8.2
	77,847		$	26.37		7.6	Years
Exercisable:
$16.51 - $24.75	19,756			16.72		5.2
$24.76 - $37.25	142,473			21.62		4.2
$37.26 - $41.39	23,484			31.11		7.7
	185,713		$	22.30		4.7	Years
Total	263,560		$	23.50		5.6	Years

The aggregate intrinsic value of exercisable in-the-money options was $1,630,000 and the aggregate intrinsic value of outstanding in-the-money options was $1,998,000 based on the market closing price of $31.07 on September 30, 2016 less exercise prices.

The realized tax benefit to the Company or Patriot from options exercised in the twelve months ended September 30, 2016 was $353,000. The unrecognized compensation cost of options granted to FRP employees but not yet vested as of September 30, 2016 was $322,000, which is expected to be recognized over a weighted-average period of 3.4 years. Gains of $913,000 were realized by option holders during the twelve months ended September 30, 2016.

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Income Taxes

12 Months Ended

Sep. 30, 2016

Income Tax Disclosure [Abstract]

Income Taxes

9. Income Taxes.

The provision for income taxes for continuing operations for fiscal years ended September 30 consists of the following (in thousands):

		2016	2015	2014
Current:
Federal	$	4,807	1,803	2,820
State		1,165	524	1,083
		5,972	2,327	3,903
Deferred		1,879	1,568	(342	)
Total	$	7,851	3,895	3,561

A reconciliation between the amount of tax shown above and the amount computed at the statutory Federal income tax rate follows (in thousands):

		2016	2015		2014
Amount computed at statutory
Federal rate	$	6,797	3,396		3,020
State income taxes (net of Federal
income tax benefit)		1,002	504		520
Other, net		52	(5	)	21
Provision for income taxes	$	7,851	3,895		3,561

In this reconciliation, the category “Other, net” consists of changes in unrecognized tax benefits, permanent tax differences related to non-deductible expenses, special tax rates and tax credits, interest and penalties, and adjustments to prior year estimates.

The types of temporary differences and their related tax effects that give rise to deferred tax assets and deferred tax liabilities at September 30, are presented below (in thousands):

		2016	2015
Deferred tax liabilities:
Property and equipment	$	15,197	13,100
Depletion		526	496
Unrealized rents		1,823	1,881
Prepaid expenses		913	278
Gross deferred tax liabilities		18,459	15,755
Deferred tax assets:
Employee benefits and other		2,023	1,214
Gross deferred tax assets		2,023	1,214
Net deferred tax liability	$	16,436	14,541

The Company has no unrecognized tax benefits.

FRP tax returns in the U.S. and various states that include the Company are subject to audit by taxing authorities. As of September 30, 2016, the earliest tax year that remains open for audit in the Unites States is 2010.

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Employee Benefits

12 Months Ended

Sep. 30, 2016

Compensation and Retirement Disclosure [Abstract]

Employee Benefits

10. Employee Benefits.

The Company and certain subsidiaries have a savings/profit sharing plan for the benefit of qualified employees. The savings feature of the plan incorporates the provisions of Section 401(k) of the Internal Revenue Code under which an eligible employee may elect to save a portion (within limits) of their compensation on a tax deferred basis. The Company contributes to a participant’s account an amount equal to 50% (with certain limits) of the participant’s contribution. Additionally, the Company may make an annual discretionary contribution to the plan as determined by the Board of Directors, with certain limitations. The plan provides for deferred vesting with benefits payable upon retirement or earlier termination of employment. The Company’s cost was $51,000 in 2016, $45,000 in 2015 and $40,000 in 2014.

The Company has a defined benefit pension plan, the Management Security Plan (MSP) for certain officers and key employees. The accruals for future benefits are based upon the remaining years to retirement of the participating employees and other actuarial assumptions. Life insurance on the lives of one of the participants has been purchased to partially fund this benefit and the Company is the owner and beneficiary of that policy. The expense for fiscal 2016, 2015 and 2014 was $161,000, $163,000 and $150,000, respectively. The accrued benefit under this plan as of September 30, 2016 and 2015 was $1,485,000 and $1,391,000 respectively.

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Business Segments

12 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

Business Segments

11. Business Segments.

Following the completion of the spin-off of the transportation business, management conducted a strategic review of the Company’s real estate operations.  As a result of this review, it was determined that the information that the Company’s chief operating decision makers regularly review for purposes of allocating resources and assessing performance, had changed. Therefore, beginning with the quarter ending March 31, 2015 (with prior periods adjusted accordingly), the Company is reporting its financial performance based on three reportable segments, Asset Management, Mining Royalty Lands and Land Development and Construction, as described below.

The Asset Management segment owns, leases and manages warehouse/office buildings located predominately in the Baltimore/Northern Virginia/Washington, DC market area.

Our Mining Royalty Lands segment remains unaffected and owns several properties comprising approximately 15,000 acres currently under lease for mining rents or royalties (this does not include the 4,280 acres owned in our Brooksville joint venture with Vulcan Materials).  Other than one location in Virginia, all of these properties are located in Florida and Georgia. 

Through our Land Development and Construction segment, we own and are continuously monitoring for their “highest and best use” several parcels of land that are in various stages of development.  Our overall strategy in this segment is to convert all of our non-income producing lands into income production through (i) an orderly process of constructing new warehouse/office buildings for us to own and operate or (ii) a sale to, or joint venture with, third parties.

Subsequent to the Spin-off, the Company is receiving certain services from Patriot (e.g. executive oversight, accounting, information technology and human resource services) which are billed to the Company on a monthly basis in accordance with the Transition Services Agreement entered into and made effective as of the date of the Spin-off. As was the case prior to the Spin-off, these costs (excluding stock compensation) are included in the Company’s corporate expense and are fully allocated to the business segments. Certain other corporate expenses (primarily stock compensation, corporate aircraft and one-time Spin-off related expenses) are reported as “unallocated” on the Company’s consolidated income statement and are not allocated to any business segment. As a result of the Spin-off the former transportation segment of the Company is reported as a discontinued operation and thus is not allowed any corporate overhead allocation. Hence, all corporate overhead of the transportation group through the date of the Spin-off is included in “corporate expense” on the Company’s consolidated income statements herein. Reclassifications to the appropriate prior period line items and amounts have been made to be comparable to the current presentation.

Operating results and certain other financial data for the Company’s business segments are as follows (in thousands):

		2016		2015		2014
Revenues:
Asset management	$	28,739		27,570		24,825
Mining royalty lands		7,533		6,094		5,349
Land development and construction		1,185		982		804
	$	37,457		34,646		30,978
Operating profit:
Before corporate expenses:
Asset management	$	13,374		13,288		11,703
Mining royalty lands		7,029		5,478		4,735
Land development and construction		(940	)	(2,197	)	(1,474	)
Corporate expenses:
Allocated to asset management		(1,591	)	(1,248	)	(958	)
Allocated to mining royalty		(231	)	(1,322	)	(1,016	)
Allocated to land development and construction		(1,258	)	(737	)	(565	)
Unallocated to discontinued operations		—		(1,081	)	(2,685	)
		(3,080	)	(4,388	)	(5,224	)
	$	16,383		12,181		9,740
Interest expense:
Asset management	$	1,561		2,014		1,366
Depreciation, depletion and amortization:
Asset management	$	7,689		6,963		6,384
Mining royalty lands		104		133		124
Land development and construction		258		282		197
	$	8,051		7,378		6,705
Capital expenditures:
Asset management	$	20,747		2,408		6,662
Mining royalty lands		205		—		—
Land development and construction		6,602		4,085		12,621
	$	27,554		6,493		19,283
Identifiable net assets at September 30:
Asset management	$	171,449		151,023		154,976
Mining royalty lands		39,570		39,300		39,368
Land development and construction		54,157		60,682		56,519
Discontinued operations		—		—		61,134
Cash items		—		419		1,074
Unallocated corporate assets		500		1,054		—
		265,676		252,478		313,071

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Fair Value Measurements

12 Months Ended

Sep. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Measurements

12. Fair Value Measurements.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. Level 1 means the use of quoted prices in active markets for identical assets or liabilities. Level 2 means the use of values that are derived principally from or corroborated by observable market data. Level 3 means the use of inputs are those that are unobservable and significant to the overall fair value measurement.

As of September 30, 2016 the Company had no assets or liabilities measured at fair value on a recurring or non-recurring basis. At September 30, 2016 and 2015, the carrying amount reported in the consolidated balance sheets for cash and cash equivalents, short-term notes payable and revolving credit approximate their fair value based upon the short-term nature of these items.

The fair values of the Company’s other mortgage notes payable were estimated based on current rates available to the Company for debt of the same remaining maturities. At September 30, 2016, the carrying amount and fair value of such other long-term debt was $42,819,000 and $46,216,000, respectively. At September 30, 2015, the carrying amount and fair value of such other long-term debt was $48,685,000 and $52,001,000, respectively.

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Contingent Liabilities

12 Months Ended

Sep. 30, 2016

Notes to Financial Statements

Contingent Liabilities

13. Contingent Liabilities.

Certain of the Company’s subsidiaries are involved in litigation on a number of matters and are subject to certain claims which arise in the normal course of business. The Company has retained certain self-insurance risks with respect to losses for third party liability and property damage. The liability at any point in time depends upon the relative ages and amounts of the individual open claims. In the opinion of management, none of these matters are expected to have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows.

Preliminary testing on the site of the Company's four phase master development known as RiverFront on the Anacostia in Washington, D.C. indicated the presence of contaminated material that will have to be specially handled upon excavation in conjunction with construction. The Company has agreed with our joint venture partner to bear the cost of handling the contaminated materials on the first phase of this development up to a cap of $1.871 million. As of September 30, 2016, the excavation and foundation work for Phase 1 were substantially complete; thus, the bulk of the remediation expenses have been incurred. Management believes the total cost for remediation on Phase 1 will end up at approximately $1.9 million. During the quarter ending December 31, 2015, management successfully completed negotiations and entered into a $3,000,000 settlement of environmental claims on all four phases against our former tenant at the Riverfront on the Anacostia property and continues to pursue settlement negotiations with other potentially responsible parties. The Company executed a letter of intent with MRP Realty in May 2016 to develop Phase II of the Riverfront on the Anacostia project and recorded an estimated environmental remediation expense of $2.0 million for the Company’s estimated liability under the proposed agreement. The Company has no obligation to remediate this contamination on Phases III and IV of the development until such time as it makes a commitment to commence construction on each phase. The Company's position is that the prior tenant on the property is responsible for the cost of removal of the contaminated materials. The Company's actual expense to address this issue may be materially higher or lower than the expense previously recorded depending upon the actual costs incurred and any reimbursement that we receive from the prior tenant.

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Commitments

12 Months Ended

Sep. 30, 2016

Commitments and Contingencies Disclosure [Abstract]

Commitments

14. Commitments.

The Company, at September 30, 2016, had entered into various contracts to develop real estate with remaining commitments totaling $7,055,000.

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Concentrations

12 Months Ended

Sep. 30, 2016

Risks and Uncertainties [Abstract]

Concentrations

15. Concentrations.

With the completion and occupancy of the 3rd build to suit for the same tenant at Patriot Business Park in the first quarter of fiscal 2015 this particular tenant accounted for 11% of the Company’s consolidated revenues during fiscal 2016. The mining royalty lands segment has a total of four tenants currently leasing mining locations and one lessee that accounted for 15.6% of the Company’s consolidated revenues in fiscal 2016 and $243,000 of accounts receivable at September 30, 2016. The termination of these lessees’ underlying leases could have a material adverse effect on the Company. The Company places its cash and cash equivalents with Tennessee Bank. At times, such amounts may exceed FDIC limits.

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Unusual or Infrequent Items Impacting Quarterly Results

12 Months Ended

Sep. 30, 2016

Unusual or Infrequent Items, or Both [Abstract]

Unusual or Infrequent Items Impacting Quarterly Results

16. Unusual or Infrequent Items Impacting Quarterly Results.

In January 2015 the Company prepaid the $1,314,000 remaining principal balance on 8.55% and 7.95% mortgages. The prepayment penalty of $116,000 is included in interest expense. The remaining deferred loan costs of $15,000 were also included in interest expense.

Costs of operations for the land development and construction segment for the quarter ending December 31, 2015 includes a $3,000,000 positive benefit from settlement of environmental claims against our former tenant at the Riverfront on the Anacostia property (see Note 13).

Gain on investment land sold for the quarter ending December 31, 2015 includes $6,277,000 gain on the sale of phase 2 of Windlass Run residential property.

Costs of operations for the land development and construction segment for the quarter ending June 30, 2016 includes a $2,000,000 expense for estimated environmental remediation liability on Phase II of the Riverfront on the Anacostia property (see Note 13).

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Real Estate Business Park Acquisitions

12 Months Ended

Sep. 30, 2016

Business Combinations [Abstract]

Real Estate Business Park Acquisitions

17. Real Estate Business Park Acquisitions.

The Company has allocated the purchase price of the property acquisitions, through the use of a third party valuation, based upon the fair value of the assets acquired, consisting of land, buildings and intangible assets, including in-place leases and below market leases. Based on the third party valuation performed, the purchase price has been allocated to the fair value of the in-place leases, above market leases and below market leases.  These deferred leasing intangible assets are recorded within Deferred Costs and Deferred lease intangible, net in the consolidated balance sheets. The value of the in-place lease intangibles will be amortized to amortization expense over the remaining lease terms. The fair value assigned pertaining to the above market in-place leases values are amortized as a reduction to rental revenue, and the below market in-place lease values are amortized as an increase to rental revenue over the remaining non-cancelable terms of the respective leases.

TRANSIT BUSINESS PARK - On June 20, 2013, the Company purchased for approximately $8 million, Transit Business Park in Baltimore, Maryland which consists of 5 buildings on 14.5 acres totaling 232,318 square feet. The Company will recognize the amortization related to Transit Business Park intangible assets according to the following schedule (in thousands):

		In-place	Above Market	Below Market
		Leases	Leases	Leases
Initial Values	$	806	48	156
Annual Amortization:
2014		369	12	86
2015		63	4	37
2016		44	4	9
2017		44	4	—
2018		43	4	—
2019		43	4	—
2020		43	4	—
2021		17	3	—

KELSO BUSINESS PARK - On June 6, 2014, the Company purchased for approximately $4.8 million, the Kelso property in Baltimore, Maryland which consists of 2 buildings on 10.2 acres totaling 69,680 square feet. The Company will recognize the amortization related to Kelso Business Park intangible assets according to the following schedule (in thousands):

		In-place	Below Market
		Leases	Leases
Initial Values	$	579	64
Annual Amortization:
2014		80	8
2015		203	21
2016		136	21
2017		100	12
2018		28	2
2019		21	—
2020		11	—

PORT CAPITAL PROPERTY - On October 19, 2015, the Company purchased for approximately $9.9 million, 7700 Port Capital Drive in Elkridge, Maryland which consists of 1 building on 6.39 acres totaling 91,218 square feet plus approximately 29,558 square feet of mezzanine space. The Company will recognize the amortization related to the Port Capital Drive property intangible assets according to the following schedule (in thousands):

		In-place
		Leases
Initial Values	$	1,126
Annual Amortization:
2016	$	104
2017		114
2018		114
2019		114
2020		114
2021		114

GILROY ROAD PROPERTY – On July 1, 2016, the Company purchased for approximately $8.3 million, 10820 Gilroy Road in Hunt Valley, Maryland which consists of 1 building on 7 acres totaling 116,338 square feet inclusive of 8,900 square feet of second floor mezzanine office space (107,438 sf footprint). The Company will recognize the amortization related to the Port Capital Drive property intangible assets according to the following schedule (in thousands):

		In-place
		Leases
Initial Values	$	277
Annual Amortization:
2016	$	55
2017		222

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Intangible Assets

12 Months Ended

Sep. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

[us-gaap:IntangibleAssetsDisclosureTextBlock]

18. Intangible Assets.

The Company reviews intangible assets for impairment, whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of long-lived assets is measured by a comparison of the carrying amount of the asset group to the future undiscounted net cash flows expected to be generated by those assets. If such assets are considered to be impaired, the impairment charge recognized is the amount by which the carrying amounts of the assets exceeds the fair value of the assets.

The gross amounts and accumulated amortization of identifiable intangible assets are as follows (in thousands):

	September 30, 2016				September 30, 2015
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
In-place leases (useful life 7-8 years)	$	2,788	$	1,175	$	1,385	$	836
Above Market leases (useful life 5 years)		48		23		48		19
	$	2,836	$	1,198	$	1,433	$	855

	September 30, 2016				September 30, 2015
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible liabilities:
Below Market leases (useful life 4-5 years)	$	220	$	206	$	220	$	176
	$	220	$	206	$	220	$	176

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Accounting Policies (Policies)

12 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

ORGANIZATION - FRP Holdings, Inc. (“FRP” or the “Company”) is a holding company engaged in the real estate business, namely (i) warehouse/office building ownership, leasing and management, (ii) mining royalty land ownership and leasing and (iii) land acquisition, entitlement and development primarily for future warehouse/office building construction. On January 30, 2015, FRP completed the tax-free Spin-off (“Spin-off”) of its transportation business into a new, separately traded public company, Patriot Transportation Holding, Inc. (Nasdaq GM: PATI) (“Patriot”). In the Spin-off, FRP distributed all of the outstanding stock of Patriot to FRP's shareholders as of the record date of January 9, 2015. FRP’s shareholders received one share of Patriot for every three shares of FRP owned on the record date. Patriot now is an independent, publicly traded company, and FRP retains no ownership in Patriot. The Company retained the real estate business, which is now the sole business of the Company. See Note 3 regarding more information regarding the spin-off.

FRP Holdings, Inc. was incorporated on April 22, 2014 in connection with a corporate reorganization that preceded the Spin-off. The Company’s successor issuer was formed on July 20, 1998. The business of the Company is conducted through our wholly-owned subsidiaries FRP Maryland, Inc., a Maryland corporation, FRP Development Corp., a Maryland corporation and Florida Rock Properties, Inc., a Florida corporation, and the various subsidiaries of each.

Consolidation

CONSOLIDATION - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Investments in the Brooksville joint venture, BC FRP Realty joint venture and Riverfront Investment Partners I, LLC are accounted for under the equity method of accounting (See Note 2). All significant intercompany transactions have been eliminated in consolidation.

Cash and Cash Equivalents

CASH AND CASH EQUIVALENTS - The Company considers all highly liquid debt instruments with maturities of three months or less at time of purchase to be cash equivalents. Bank overdrafts consist of outstanding checks not yet presented to a bank for settlement, net of cash held in accounts with right of offset.

Revenue and Expense Recognition

REVENUE AND EXPENSE RECOGNITION - Real estate rental revenue and mining royalties are generally recognized when earned under the leases and are considered collectable. Rental income from leases with scheduled increases or other incentives during their term is recognized on a straight-line basis over the term of the lease. Reimbursements of expenses, when provided in the lease, are recognized in the period that the expenses are incurred.

Sales of real estate are recognized when the collection of the sales price is reasonably assured and when the Company has fulfilled substantially all of its obligations, which are typically as of the closing date.

Accounts receivable are recorded net of discounts and provisions for estimated allowances. We estimate allowances on an ongoing basis by considering historical and current trends. We record estimated bad debts expense as part of operating expenses. We estimate the net collectibility of our accounts receivable and establish an allowance for doubtful accounts based upon this assessment. Specifically, we analyze the aging of accounts receivable balances, historical bad debts, customer concentrations, customer credit-worthiness, current economic trends and changes in customer payment terms.

Property and Equipment

PROPERTY AND EQUIPMENT - Property and equipment is recorded at cost less accumulated depreciation and depletion. Provision for depreciation of property, plant and equipment is computed using the straight-line method based on the following estimated useful lives:

	Years
Building and improvements	3-39

Depletion of sand and stone deposits is computed on the basis of units of production in relation to estimated reserves. Reserve estimates are periodically adjusted based upon surveys.

The Company recorded depreciation and depletion expenses for 2016, 2015 and 2014 of $6,809,000, $6,195,000, and $5,528,000, respectively.

All direct and indirect costs, including interest and real estate taxes, associated with the development, construction, leasing or expansion of real estate investments are capitalized as a cost of the property. Included in indirect costs is an allocation of internal costs associated with development of real estate investments. The cost of routine repairs and maintenance to property and equipment is expensed as incurred.

Impairment of Long-Lived assets

IMPAIRMENT OF LONG-LIVED ASSETS – The Company periodically reviews its long-lived assets, which include property and equipment and purchased intangible assets subject to amortization for potential impairment whenever events or circumstances indicate the carrying amount of a long-lived asset may not be recoverable. This review consists of comparing cap rates on recent cash flows and market value estimates to the carrying values of each asset group. If this review indicates the carrying value might exceed fair value then an estimate of future cash flows for the remaining useful life of each property is prepared considering anticipated vacancy, lease rates, and any future capital expenditures.

Developed Property Rentals Purchase Accounting

DEVELOPED PROPERTY RENTALS PURCHASE ACCOUNTING – Acquisitions of rental property, including any associated intangible assets, are measured at fair value at the date of acquisition. Any liabilities assumed or incurred are recorded at their fair value at the time of acquisition. The fair value of the acquired property is allocated between land and building (on an as-if vacant basis) based on management’s estimate of the fair value of those components for each type of property and to tenant improvements based on the depreciated replacement cost of the tenant improvements, which approximates their fair value. The fair value of the in-place leases is recorded as follows:

· the fair value of leases in-place on the date of acquisition is based on absorption costs for the estimated lease-up period in which vacancy and foregone revenue are avoided due to the presence of the acquired leases;

· the fair value of above and below-market in-place leases based on the present value (using a discount rate that reflects the risks associated with the acquired leases) of the difference between contractual rent amounts to be paid under the assumed lease and the estimated market lease rates for the corresponding spaces over the remaining non-cancelable terms of the related leases; and

· the fair value of intangible tenant or customer relationships.

The Company’s determination of these fair values requires it to estimate market rents for each of the leases and make certain other assumptions. These estimates and assumptions affect the rental revenue, and depreciation and amortization expense recognized for these leases and associated intangible assets and liabilities.

Investments

INVESTMENTS - The Company uses the equity method to account for its investment in Brooksville, in which it has a voting interest of 50% and has significant influence but does not have control. The Company uses the equity method to account for its investment in BC FRP Realty, in which it has a voting interest of 50%. The Company uses the equity method to account for its investment in RiverFront Investment Partners I, LLC, in which the equity interest will be determined based on leverage of the entity, additional cash contributions by the Company, and negotiations with potential third partners. Under the equity method, the investment is originally recorded at cost and adjusted to recognize the Company’s share of net earnings or losses of the investee, limited to the extent of the Company’s investment in and advances to the investee and financial guarantees on behalf of the investee that create additional basis. The Company regularly monitors and evaluates the realizable value of its investments. When assessing an investment for an other-than-temporary decline in value, the Company considers such factors as, the performance of the investee in relation to its own operating targets and its business plan, the investee’s revenue and cost trends, as well as liquidity and cash position, and the outlook for the overall industry in which the investee operates. From time to time, the Company may consider third party evaluations or valuation reports. If events and circumstances indicate that a decline in the value of these assets has occurred and is other-than-temporary, the Company records a charge to investment income (expense).

Income Taxes

INCOME TAXES - Deferred tax assets and liabilities are recognized based on differences between financial statement and tax bases of assets and liabilities using presently enacted tax rates. Deferred income taxes result from temporary differences between pre-tax income reported in the financial statements and taxable income. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination of the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of limitations, effectively settled issues under audit, and audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. It is the Company's policy to recognize as additional income tax expense the items of interest and penalties directly related to income taxes.

Stock Based Compensation

STOCK BASED COMPENSATION – The Company accounts for compensation related to share based plans by recognizing the grant date fair value of stock options and other equity-based compensation issued to employees in its income statement over the requisite employee service period using the straight-line attribution model. In addition, compensation expense must be recognized for the change in fair value of any awards modified, repurchased or cancelled after the grant date. The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used in the model and current year impact are discussed in Note 8.

Pension Plan

PENSION PLAN - The Company accounts for its pension plan following the requirements of FASB ASC Topic 715, “Compensation – Retirement Benefits”, which requires an employer to: (a) recognize in its statement of financial position the funded status of a benefit plan; (b) measure defined benefit plan assets and obligations as of the end of the employer's fiscal year (with limited exceptions); and (c) recognize as a component of other comprehensive income, net of tax, the gains or losses and prior service costs or credits that arise but are not recognized as components of net periodic benefit costs pursuant to prior existing guidance.

Earnings Per Common Share

EARNINGS PER COMMON SHARE - Basic earnings per common share are based on the weighted average number of common shares outstanding during the periods. Diluted earnings per common share are based on the weighted average number of common shares and potential dilution of securities that could share in earnings. The differences between basic and diluted shares used for the calculation are the effect of employee and director stock options and restricted stock.

Use of Estimates

USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United State requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Certain accounting policies and estimates are of more significance in the financial statement preparation process than others. The most critical accounting policies and estimates include the economic useful lives of our property and equipment, provisions for uncollectible accounts receivable and collectibility of unrealized rents, estimates of exposures related to our insurance claims plans, and estimates for taxes. To the extent that actual, final outcomes are different than these estimates, or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting period will be affected.

Environmental

ENVIRONMENTAL - Environmental expenditures that benefit future periods are capitalized. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded for the estimated amount of expected environmental assessments and/or remedial efforts. Estimation of such liabilities includes an assessment of engineering estimates, continually evolving governmental laws and standards, and potential involvement of other potentially responsible parties.

Comprehensive Income

COMPREHENSIVE INCOME – Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) refers to expenses, gains, and losses that are not included in net income, but rather are recorded directly in shareholders’ equity.

Recently Issued Accounting Standards

RECENTLY ISSUED ACCOUNTING STANDARDS – In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes”. The guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as noncurrent on the balance sheet. The guidance becomes effective for annual reporting periods beginning after December 15, 2016 with early adoption permitted. The Company adopted this guidance retrospectively as of October 1, 2015 and reclassified $143,000 from deferred costs to long-term deferred tax liability.

In February 2016, the FASB issued ASU No. 2016-02, “Leases”, which requires lessees to recognize a right-to-use asset and a lease obligation for all leases. Lessees are permitted to make an accounting policy election to not recognize an asset and liability for leases with a term of twelve months or less. Additional qualitative and quantitative disclosures, including significant judgments made by management, will be required. Lessors will account for leases using an approach that is substantially equivalent to existing accounting standards. The new standard will become effective for the Company beginning with the first quarter 2020 and requires a modified retrospective transition approach and includes a number of practical expedients. Early adoption of the standard is permitted. As the Company is primarily a lessor the adoption of this guidance is not expected to have a material impact on its financial statements.

In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. Excess tax benefits for share-based payments will be recorded as a reduction of income taxes and reflected in operating cash flows upon the adoption of this ASU. Excess tax benefits are currently recorded in equity and as financing activity under the current rules. In addition, the guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2016 with early adoption permitted. The Company may early adopt this accounting guidance in fiscal 2017 or as required in fiscal 2018.

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Consolidated Real Estate and Accumulated Depreciation and Depletion (Tables)

12 Months Ended

Sep. 30, 2016

Real Estate [Abstract]

Schedule III Real Estate and Accumulated Depreciation and Depletion

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED)-REAL ESTATE & ACCUMULATED DEPRECIATION AND

DEPLETION (dollars in thousands)

SEPTEMBER 30, 2016

County	Encumb- rances		Initial cost to Company		Cost capitalized subsequent to acquisition			Gross amount at which carried at end of period (a)		Accumulated Depreciation & Depletion		Year Of Constr- uction		Date Acquired		Depreciation Life Computed on:
Mining Royalty Lands
Alachua, FL			$	1,442	$	0		$	1,442	$	156		n/a		4/86	unit
Clayton, GA				369		0			369		5		n/a		4/86	unit
Fayette, GA				685		199			884		67		n/a		4/86	unit
Lake, FL				402		0			402		158		n/a		4/86	unit
Lake, FL				1,083		0			1,083		975		n/a		4/86	unit
Lake Louisa, FL				11,039		0			11,039		0		n/a		5/12	unit
Lee, FL				4,690		12			4,702		6		n/a		4/86	unit
Monroe, GA				792		0			792		288		n/a		4/86	unit
Muscogee, GA				369		(45	)		324		324		n/a		4/86	unit
Prince William, VA				298		0			298		298		n/a		4/86	unit
Putnam, FL				15,002		37			15,039		4,533		n/a		4/86	unit
Putnam, FL				302		(2	)		300		283		n/a		4/86	5 yr.
Spalding, GA				20		0			20		0		n/a		4/86	n/a
Marion, FL				1,180		4			1,184		599		n/a		4/86	unit
Investment Property				1,629		(101	)		1,528		691		n/a		4/86	n/a
		0		39,302		104			39,406		8,383
Asset Management Properties
Baltimore, MD		1,698		439		4,429			4,868		2,714		1990		10/89	39 yr.
Baltimore, MD		3,288		950		7,722			8,672		4,847		1994		12/91	39 yr.
Baltimore, MD		973		690		2,861			3,551		1,570		2000		07/99	39 yr.
Baltimore, MD		0		1,435		4,229			5,664		1,113		2008		12/02	39 yr.
Baltimore, MD		0		4,309		276			4,585		273		n/a		06/15	39 yr.
Baltimore, MD		0		8,412		521			8,933		54		1967		07/16	39 yr.
Baltimore City, MD		4,712		5,106		5,488			10,594		1,108		2016		12/10	39 yr.
Baltimore City, MD		0		7,442		1,869			9,311		1,070		n/a		6/13	39 yr.
Duval, FL		0		2,416		541			2,957		2,793		n/a		4/86	25 yr.
Harford, MD		486		31		3,830			3,861		2,181		1998		8/95	39 yr.
Harford, MD		1,377		50		5,709			5,759		2,605		1999		8/95	39 yr.
Harford, MD		2,646		85		7,091			7,176		3,677		2001		8/95	39 yr.
Harford, MD		2,148		88		10,133			10,221		4,379		2007		8/95	39 yr.
Harford, MD		1,506		155		12,627			12,782		4,401		2009		8/95	39 yr.
Howard, MD		0		2,859		4,887			7,746		4,369		1996		9/88	39 yr.
Howard, MD		879		2,473		1,046			3,519		1,480		2000		3/00	39 yr.
Elkridge, MD		0		8,920		27			8,947		355		TBD		10/15	39 yr.
Anne Arundel, MD		8,179		715		9,394			10,109		5,893		1989		9/88	39 yr.
Anne Arundel, MD		4,730		950		14,211			15,161		5,184		2003		5/98	39 yr.
Anne Arundel, MD		0		1,525		10,800			12,325		3,737		2005		8/04	39 yr.
Anne Arundel, MD		3,390		737		5,430			6,167		1,900		2006		1/03	39 yr.
Anne Arundel, MD		0		667		10,641			11,308		2,832		2012		7/07	39 yr.
Norfolk, VA		0		7,512		36			7,548		2,668		2004		10/04	39 yr.
Prince William, VA		0		7,039		24,078			31,117		2,582		2014		12/05	39 yr.
Newcastle Co., DE		0		11,559		2,959			14,518		4,736		2004		4/04	39 yr.
		36,012		76,564		150,835			227,399		68,521
Land Development and Construction Properties
Baltimore City, MD		0		988		3,826			4,814		106		n/a		12/10	15 yr.
Carroll, MD		0		4,720		2,340			7,060		0		n/a		3/08	n/a
Harford, MD		0		92		1,600			1,692		0		n/a		8/95	n/a
Prince William, VA		0		3,402		4,670			8,072		97		n/a		12/05	15 yr.
Washington D.C.		0		2,957		9,858			12,815		2,866		n/a		4/86	15 yr.
Washington D.C.		0		3,811		2,404			6,215		0		n/a		10/97	n/a
		0		15,970		24,698			40,668		3,069
GRAND TOTALS	$	36,012	$	131,836	$	175,637		$	307,473	$	79,973
(a) The aggregate cost for Federal income tax purposes is $269,546.

Real Estate and Accumulated Depreciation and Depletion

FRP HOLDINGS, INC.

SCHEDULE III (CONSOLIDATED) - REAL ESTATE AND

ACCUMULATED DEPRECIATION AND DEPLETION

YEARS ENDED SEPTEMBER 30, 2016, 2015 AND 2014

(In thousands)

		2016			2015			2014
Gross Carrying Cost of Real Estate:
Balance at beginning of period	$	292,528		$	286,671		$	268,932
Additions during period:
Amounts capitalized		27,439			6,063			19,154
Deductions during period:
Cost of real estate sold		(5,011	)		—			(1,415	)
Other		(7,483	) (1)		(206	)		—
Balance at close of period	$	307,473		$	292,528		$	286,671
Accumulated Depreciation & Depletion:
Balance at beginning of period	$	73,480		$	67,598		$	62,167
Additions during period:
Charged to cost & expense		6,690			5,902			5,446
Deductions during period:
Real estate sold		—			—			(15	)
Other		(197	)		(20	)		—
Balance at close of period	$	79,973		$	73,480		$	67,598
(1) Includes $6,828 of property cost transferred to Investment in Joint Ventures for the joint venture partnership with St. John Properties.

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Investments in Joint Ventures (Tables)

12 Months Ended

Sep. 30, 2016

Equity Method Investments and Joint Ventures [Abstract]

Investments in Joint Ventures (in thousands)

							The
							Company's
				Total Assets	Net Loss		Share of Net
			Total	of the	of the		Loss of the
	Ownership		Investment	Partnership	Partnership		Partnership
As of September 30, 2016
RiverFront Holdings I, LLC	77.14	%	$  11,261	$  85,106	$   (1,193	)	$   (938	)
Brooksville Quarry, LLC	50.00	%	7,496	14,350	(80	)	(40	)
BC FRP Realty, LLC	50.00	%	5,097	10,573	—		—
Total			$  23,854	$ 110,029	$  (1,273	)	$  (978	)
As of September 30, 2015
RiverFront Holdings I, LLC	76.91	%	$  11,517	$  40,970	$   (108	)	$   (105	)
Brooksville Quarry, LLC	50.00	%	7,493	14,336	(80	)	(40	)
Total			$  19,010	$  55,306	$  (188	)	$  (145	)

Financial Information for the Investments in Joint Ventures in thousands)

	As of September 30, 2016
	Riverfront		Brooksville		BCF FRP
	Holdings I, LLC		Quarry, LLC		Realty, LLC		Total
Cash	$	297	$	35	$	20	$	352
Cash held in escrow		13		—		—		13
Amortizable Debt Costs		1,179		—		—		1,179
Investments in real estate, net		83,617		14,315		10,553		108,485
Total Assets	$	85,106	$	14,350	$	10,573	$	110,029
Other Liabilities	$	5,140	$	65	$	17	$	5,222
Long-term Debt		63,495		—		—		63,495
Capital - FRP		11,261		7,496		5,097		23,854
Capital - Third Parties		5,210		6,789		5,459		17,458
Total Liabilities and Capital	$	85,106	$	14,350	$	10,573	$	110,029

	As of September 30, 2015
	Riverfront		Brooksville
	Holdings I, LLC		Quarry, LLC		Total
Cash	$	47	$	14	$	61
Cash held in escrow		3,420		—		3,420
Amortizable Debt Costs		1,593		—		1,593
Investments in real estate, net		35,910		14,322		50,232
Total Assets	$	40,970	$	14,336	$	55,306
Other Liabilities	$	6,905	$	64	$	6,969
Long-term Debt		17,000		—		17,000
Capital - FRP		11,517		7,493		19,010
Capital - Third Parties		5,548		6,779		12,327
Total Liabilities and Capital	$	40,970	$	14,336	$	55,306

Income statements for Riverfront Holdings I, LLC (in thousands)

	Years Ended September 30,
	2016			2015			2014
Revenue	$	127			—			—
Cost of operations		1,040			108			89
Operating profit		(913	)		(108	)		(89	)
Interest expense		(280	)		—			—
Net loss of the Partnership	$	(1,193	)		(108	)		(89	)

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Spin-off (Tables)

12 Months Ended

Sep. 30, 2016

Discontinued Operations and Disposal Groups [Abstract]

Results of operations associated with discontinued operations (in thousands)

	Years Ended September 30,
	2016		2015			2014
Revenue	$	—		41,800			129,162
Cost of operations		—		38,195			121,134
Operating profit		—		3,605			8,028
Interest expense		—		(33	)		(102	)
Income before income taxes		—		3,572			7,926
Provision for income taxes		—		1,393			3,091
Income from discontinued operations	$	—		2,179			4,835

Assets and Liabilities of discontinued operations (in thousands)

Property and  equipment, net	$	42,174
Accounts receivable, net		7,119
Deferred costs		11,809
Other assets		32
Assets of discontinued operation	$	61,134
Line of credit	$	7,282
Accounts payable and accrued liabilities		11,489
Deferred compensation		717
Deferred income taxes		8,924
Liabilities of discontinued operation	$	28,412

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Debt (Tables)

12 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Debt (in thousands)

	2016		2015
Revolving credit agreements	$	6,807		8,494
5.6% to 7.9% mortgage notes
due in installments through 2027		36,012		40,191
		42,819		48,685
Less portion due within one year		4,455		4,180
	$	38,364		44,505

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Leases (Tables)

12 Months Ended

Sep. 30, 2016

Leases [Abstract]

Carrying value of property leased or held for lease to others (in thousands)

Construction aggregates property	$	35,292
Commercial property		270,911
		306,203
less accumulated depreciation and depletion		79,479
	$	226,724

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Earnings Per Share (Tables)

12 Months Ended

Sep. 30, 2016

Earnings Per Share [Abstract]

Earnings per share computations (in thousands, except per share amounts)

	Years Ended September 30
	2016		2015		2014
Common shares:
Weighted average common shares
outstanding during the period -
shares used for basic earnings
per common share		9,846		9,756		9,629
Common shares issuable under share
based payment plans which are
potentially dilutive		44		71		81
Common shares used for diluted
earnings per common share		9,890		9,827		9,710
Income from continuing operations	$	12,024		6,093		5,184
Discontinued operations		—		2,179		4,835
Net income	$	12,024		8,272		10,019
Basic earnings per common share:
Income from continuing operations	$	1.22		.62		.54
Discontinued operations		—		.23		.50
Net income	$	1.22		.85		1.04
Diluted earnings per common share
Income from continuing operations	$	1.22		.62		.53
Discontinued operations		—		.22		.50
Net income	$	1.22		.84		1.03

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Stock-Based Compensation Plans (Tables)

12 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Compensation Expense (in thousands)

	Years Ended September 30
	2016		2015		2014
Stock option grants	$	166		267		441
Annual director stock award		412		536		698
	$	578		803		1,139

Summary of Changes in outstanding options (in thousands, except share and per share amounts)

				Weighted		Weighted		Weighted
	Number			Average		Average		Average
	of			Exercise		Remaining		Grant Date
Options	Shares			Price		Term (yrs)		Fair Value(000's)
Outstanding at
October 1, 2013		414,590		$	20.40		4.2	$	3,668
Granted		31,790		$	41.39			$	545
Exercised		(119,550	)	$	12.23			$	(732	)
Outstanding at
September 30, 2014		326,830		$	25.43		5.0	$	3,481
Spin-off adjustment								$	(865	)
Spin-off conversion		17,795		$	20.63			$	155
Granted		39,425		$	26.97			$	432
Forfeited		(6,000	)	$	14.97			$	(35	)
Exercised		(72,300	)	$	13.31			$	(430	)
Outstanding at
September 30, 2015		305,750		$	21.90		5.9	$	2,738
Granted		21,540		$	31.15			$	272
Exercised		(63,730	)	$	18.39			$	(471	)
Outstanding at
September 30, 2016		263,560		$	23.50		5.6	$	2,539
Exercisable at
September 30, 2016		185,713		$	22.30		4.7	$	1,621
Vested during
twelve months ended
September 30, 2016		35,596						$	341

Summary of Stock Options Outstanding

	Shares	Weighted			Weighted
Range of Exercise	under	Average			Average
Prices per Share	Option	Exercise Price			Remaining Life
Non-exercisable:
$16.51 – $24.75	5,539			16.72		5.2
$24.76 - $37.25	40,692			23.99		7.4
$37.26 - $41.39	31,616			31.13		8.2
	77,847		$	26.37		7.6	Years
Exercisable:
$16.51 - $24.75	19,756			16.72		5.2
$24.76 - $37.25	142,473			21.62		4.2
$37.26 - $41.39	23,484			31.11		7.7
	185,713		$	22.30		4.7	Years
Total	263,560		$	23.50		5.6	Years

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Income Taxes (Tables)

12 Months Ended

Sep. 30, 2016

Income Tax Disclosure [Abstract]

Provision for income taxes for continuing operations (in thousands)

		2016	2015	2014
Current:
Federal	$	4,807	1,803	2,820
State		1,165	524	1,083
		5,972	2,327	3,903
Deferred		1,879	1,568	(342	)
Total	$	7,851	3,895	3,561

Income tax reconciliation at statutory Federal income tax rate (in thousands)

		2016	2015		2014
Amount computed at statutory
Federal rate	$	6,797	3,396		3,020
State income taxes (net of Federal
income tax benefit)		1,002	504		520
Other, net		52	(5	)	21
Provision for income taxes	$	7,851	3,895		3,561

Deferred tax assets and deferred tax liabilities (in thousands)

		2016	2015
Deferred tax liabilities:
Property and equipment	$	15,197	13,100
Depletion		526	496
Unrealized rents		1,823	1,881
Prepaid expenses		913	278
Gross deferred tax liabilities		18,459	15,755
Deferred tax assets:
Employee benefits and other		2,023	1,214
Gross deferred tax assets		2,023	1,214
Net deferred tax liability	$	16,436	14,541

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Business Segments (Tables)

12 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

Business Segments (in thousands)

		2016		2015		2014
Revenues:
Asset management	$	28,739		27,570		24,825
Mining royalty lands		7,533		6,094		5,349
Land development and construction		1,185		982		804
	$	37,457		34,646		30,978
Operating profit:
Before corporate expenses:
Asset management	$	13,374		13,288		11,703
Mining royalty lands		7,029		5,478		4,735
Land development and construction		(940	)	(2,197	)	(1,474	)
Corporate expenses:
Allocated to asset management		(1,591	)	(1,248	)	(958	)
Allocated to mining royalty		(231	)	(1,322	)	(1,016	)
Allocated to land development and construction		(1,258	)	(737	)	(565	)
Unallocated to discontinued operations		—		(1,081	)	(2,685	)
		(3,080	)	(4,388	)	(5,224	)
	$	16,383		12,181		9,740
Interest expense:
Asset management	$	1,561		2,014		1,366
Depreciation, depletion and amortization:
Asset management	$	7,689		6,963		6,384
Mining royalty lands		104		133		124
Land development and construction		258		282		197
	$	8,051		7,378		6,705
Capital expenditures:
Asset management	$	20,747		2,408		6,662
Mining royalty lands		205		—		—
Land development and construction		6,602		4,085		12,621
	$	27,554		6,493		19,283
Identifiable net assets at September 30:
Asset management	$	171,449		151,023		154,976
Mining royalty lands		39,570		39,300		39,368
Land development and construction		54,157		60,682		56,519
Discontinued operations		—		—		61,134
Cash items		—		419		1,074
Unallocated corporate assets		500		1,054		—
		265,676		252,478		313,071

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Real Estate Business Park Acquisitions (Tables)

12 Months Ended

Sep. 30, 2016

Transit Business Park

Intangible asset amortization (in thousands)

		In-place	Above Market	Below Market
		Leases	Leases	Leases
Initial Values	$	806	48	156
Annual Amortization:
2014		369	12	86
2015		63	4	37
2016		44	4	9
2017		44	4	—
2018		43	4	—
2019		43	4	—
2020		43	4	—
2021		17	3	—

Kelso Business Park

Intangible asset amortization (in thousands)

		In-place	Below Market
		Leases	Leases
Initial Values	$	579	64
Annual Amortization:
2014		80	8
2015		203	21
2016		136	21
2017		100	12
2018		28	2
2019		21	—
2020		11	—

Port Capital Property

Intangible asset amortization (in thousands)

		In-place
		Leases
Initial Values	$	1,126
Annual Amortization:
2016	$	104
2017		114
2018		114
2019		114
2020		114
2021		114

Gilroy Road Property

Intangible asset amortization (in thousands)

		In-place
		Leases
Initial Values	$	277
Annual Amortization:
2016	$	55
2017		222

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Intangible Assets (Tables)

12 Months Ended

Sep. 30, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Amortizable intangible assets (in thousands)

	September 30, 2016				September 30, 2015
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible assets:
In-place leases (useful life 7-8 years)	$	2,788	$	1,175	$	1,385	$	836
Above Market leases (useful life 5 years)		48		23		48		19
	$	2,836	$	1,198	$	1,433	$	855

Amortizable intangible liabilities (in thousands)

	September 30, 2016				September 30, 2015
		Gross		Accumulated		Gross		Accumulated
		Amount		Amortization		Amount		Amortization
Amortizable intangible liabilities:
Below Market leases (useful life 4-5 years)	$	220	$	206	$	220	$	176
	$	220	$	206	$	220	$	176

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Consolidated Real Estate and Accumulated Depreciation and Depletion (Tables) - Real Estate and Accumulated Depreciation and Depletion (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Gross Carrying Cost of Real Estate at beginning of period	$ 292,528	$ 286,671	$ 268,932
Additions capitalized during period	27,439	6,063	19,154
Cost of real estate sold	(5,011)	0	(1,415)
Other deductions	(7,483)	(206)	0
Gross Carrying Cost of Real Estate at end of period	307,473	292,528	286,671
Accumulated Depreciation & Depletion at beginning of period	73,480	67,598	62,167
Charged to cost & expense	6,690	5,902	5,446
Real estate sold	0	0	(15)
Other deductions	(197)	(20)	0
Accumulated Depreciation & Depletion at end of period	79,973	$ 73,480	$ 67,598
BC FRP Realty Joint Venture
Book value of land contribution	$ 6,828

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Schedule III Real Estate and Accumulated Depreciation and Depletion Part I (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2013
Encumbrances	$ 36,012
Initial Cost to Company	131,836
Cost capitalized subsequent to acquisition	175,637
Gross amount at which carried at end of period	307,473	$ 292,528	$ 286,671	$ 268,932
Accumulated Depreciation & Depletion	79,973
Aggregate cost for Federal income tax purposes	269,546
Investment Property
Encumbrances	0
Initial Cost to Company	1,629
Cost capitalized subsequent to acquisition	(101)
Gross amount at which carried at end of period	1,528
Accumulated Depreciation & Depletion	691
Mining royalty lands
Encumbrances	0
Initial Cost to Company	39,302
Cost capitalized subsequent to acquisition	104
Gross amount at which carried at end of period	39,406
Accumulated Depreciation & Depletion	8,383
Baltimore, MD 5
Encumbrances	0
Initial Cost to Company	4,309
Cost capitalized subsequent to acquisition	276
Gross amount at which carried at end of period	4,585
Accumulated Depreciation & Depletion	273
Baltimore, MD 6
Encumbrances	0
Initial Cost to Company	8,412
Cost capitalized subsequent to acquisition	521
Gross amount at which carried at end of period	8,933
Accumulated Depreciation & Depletion	54
Asset Management Properties
Encumbrances	36,012
Initial Cost to Company	76,564
Cost capitalized subsequent to acquisition	150,835
Gross amount at which carried at end of period	227,399
Accumulated Depreciation & Depletion	68,521
Alachua, FL
Encumbrances	0
Initial Cost to Company	1,442
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	1,442
Accumulated Depreciation & Depletion	156
Clayton, GA
Encumbrances	0
Initial Cost to Company	369
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	369
Accumulated Depreciation & Depletion	5
Fayette, GA
Encumbrances	0
Initial Cost to Company	685
Cost capitalized subsequent to acquisition	199
Gross amount at which carried at end of period	884
Accumulated Depreciation & Depletion	67
Lake, FL
Encumbrances	0
Initial Cost to Company	402
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	402
Accumulated Depreciation & Depletion	158
Lake, FL 2
Encumbrances	0
Initial Cost to Company	1,083
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	1,083
Accumulated Depreciation & Depletion	975
Lake Louise, FL
Encumbrances	0
Initial Cost to Company	11,039
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	11,039
Accumulated Depreciation & Depletion	0
Lee, FL
Encumbrances	0
Initial Cost to Company	4,690
Cost capitalized subsequent to acquisition	12
Gross amount at which carried at end of period	4,702
Accumulated Depreciation & Depletion	6
Monroe, GA
Encumbrances	0
Initial Cost to Company	792
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	792
Accumulated Depreciation & Depletion	288
Muscogee, GA
Encumbrances	0
Initial Cost to Company	369
Cost capitalized subsequent to acquisition	(45)
Gross amount at which carried at end of period	324
Accumulated Depreciation & Depletion	324
Prince Wil, VA
Encumbrances	0
Initial Cost to Company	298
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	298
Accumulated Depreciation & Depletion	298
Putnam, FL
Encumbrances	0
Initial Cost to Company	15,002
Cost capitalized subsequent to acquisition	37
Gross amount at which carried at end of period	15,039
Accumulated Depreciation & Depletion	4,533
Putnam, FL 2
Encumbrances	0
Initial Cost to Company	302
Cost capitalized subsequent to acquisition	(2)
Gross amount at which carried at end of period	300
Accumulated Depreciation & Depletion	283
Spalding, GA
Encumbrances	0
Initial Cost to Company	20
Cost capitalized subsequent to acquisition	0
Gross amount at which carried at end of period	20
Accumulated Depreciation & Depletion	0
Marion, FL
Encumbrances	0
Initial Cost to Company	1,180
Cost capitalized subsequent to acquisition	4
Gross amount at which carried at end of period	1,184
Accumulated Depreciation & Depletion	599
Baltimore, MD 1
Encumbrances	1,698
Initial Cost to Company	439
Cost capitalized subsequent to acquisition	4,429
Gross amount at which carried at end of period	4,868
Accumulated Depreciation & Depletion	2,714
Baltimore, MD 2
Encumbrances	3,288
Initial Cost to Company	950
Cost capitalized subsequent to acquisition	7,722
Gross amount at which carried at end of period	8,672
Accumulated Depreciation & Depletion	4,847
Baltimore, MD 3
Encumbrances	973
Initial Cost to Company	690
Cost capitalized subsequent to acquisition	2,861
Gross amount at which carried at end of period	3,551
Accumulated Depreciation & Depletion	1,570
Baltimore, MD 4
Encumbrances	0
Initial Cost to Company	1,435
Cost capitalized subsequent to acquisition	4,229
Gross amount at which carried at end of period	5,664
Accumulated Depreciation & Depletion	1,113
Baltimore City, MD
Encumbrances	4,712
Initial Cost to Company	5,106
Cost capitalized subsequent to acquisition	5,488
Gross amount at which carried at end of period	10,594
Accumulated Depreciation & Depletion	1,108
Baltimore City, MD 2
Encumbrances	0
Initial Cost to Company	7,442
Cost capitalized subsequent to acquisition	1,869
Gross amount at which carried at end of period	9,311
Accumulated Depreciation & Depletion	1,070
Duval, FL
Encumbrances	0
Initial Cost to Company	2,416
Cost capitalized subsequent to acquisition	541
Gross amount at which carried at end of period	2,957
Accumulated Depreciation & Depletion	2,793
Harford, MD 1
Encumbrances	486
Initial Cost to Company	31
Cost capitalized subsequent to acquisition	3,830
Gross amount at which carried at end of period	3,861
Accumulated Depreciation & Depletion	2,181
Harford, MD 2
Encumbrances	1,377
Initial Cost to Company	50
Cost capitalized subsequent to acquisition	5,709
Gross amount at which carried at end of period	5,759
Accumulated Depreciation & Depletion	2,605
Harford, MD 3
Encumbrances	2,646
Initial Cost to Company	85
Cost capitalized subsequent to acquisition	7,091
Gross amount at which carried at end of period	7,176
Accumulated Depreciation & Depletion	3,677
Harford, MD 5
Encumbrances	2,148
Initial Cost to Company	88
Cost capitalized subsequent to acquisition	10,133
Gross amount at which carried at end of period	10,221
Accumulated Depreciation & Depletion	4,379
Harford, MD 6
Encumbrances	1,506
Initial Cost to Company	155
Cost capitalized subsequent to acquisition	12,627
Gross amount at which carried at end of period	12,782
Accumulated Depreciation & Depletion	4,401
Howard, MD 1
Encumbrances	0
Initial Cost to Company	2,859
Cost capitalized subsequent to acquisition	4,887
Gross amount at which carried at end of period	7,746
Accumulated Depreciation & Depletion	4,369
Howard, MD 2
Encumbrances	879
Initial Cost to Company	2,473
Cost capitalized subsequent to acquisition	1,046
Gross amount at which carried at end of period	3,519
Accumulated Depreciation & Depletion	1,480
Elkridge, MD
Encumbrances	0
Initial Cost to Company	8,920
Cost capitalized subsequent to acquisition	27
Gross amount at which carried at end of period	8,947
Accumulated Depreciation & Depletion	355
Anne Arun, MD 1
Encumbrances	8,179
Initial Cost to Company	715
Cost capitalized subsequent to acquisition	9,394
Gross amount at which carried at end of period	10,109
Accumulated Depreciation & Depletion	5,893
Anne Arun, MD 2
Encumbrances	4,730
Initial Cost to Company	950
Cost capitalized subsequent to acquisition	14,211
Gross amount at which carried at end of period	15,161
Accumulated Depreciation & Depletion	5,184
Anne Arun, MD 3
Encumbrances	0
Initial Cost to Company	1,525
Cost capitalized subsequent to acquisition	10,800
Gross amount at which carried at end of period	12,325
Accumulated Depreciation & Depletion	3,737
Anne Arun, MD 4
Encumbrances	3,390
Initial Cost to Company	737
Cost capitalized subsequent to acquisition	5,430
Gross amount at which carried at end of period	6,167
Accumulated Depreciation & Depletion	1,900
Anne Arun, MD 5
Encumbrances	0
Initial Cost to Company	667
Cost capitalized subsequent to acquisition	10,641
Gross amount at which carried at end of period	11,308
Accumulated Depreciation & Depletion	2,832
Norfolk, VA
Encumbrances	0
Initial Cost to Company	7,512
Cost capitalized subsequent to acquisition	36
Gross amount at which carried at end of period	7,548
Accumulated Depreciation & Depletion	2,668
Prince Wil, VA 2
Encumbrances	0
Initial Cost to Company	7,039
Cost capitalized subsequent to acquisition	24,078
Gross amount at which carried at end of period	31,117
Accumulated Depreciation & Depletion	2,582
Newcastle Co, DE
Encumbrances	0
Initial Cost to Company	11,559
Cost capitalized subsequent to acquisition	2,959
Gross amount at which carried at end of period	14,518
Accumulated Depreciation & Depletion	4,736
Baltimore City, MD 3
Encumbrances	0
Initial Cost to Company	988
Cost capitalized subsequent to acquisition	3,826
Gross amount at which carried at end of period	4,814
Accumulated Depreciation & Depletion	106
Carroll, MD
Encumbrances	0
Initial Cost to Company	4,720
Cost capitalized subsequent to acquisition	2,340
Gross amount at which carried at end of period	7,060
Accumulated Depreciation & Depletion	0
Harford, MD 4
Encumbrances	0
Initial Cost to Company	92
Cost capitalized subsequent to acquisition	1,600
Gross amount at which carried at end of period	1,692
Accumulated Depreciation & Depletion	0
Prince Wil, VA 3
Encumbrances	0
Initial Cost to Company	3,402
Cost capitalized subsequent to acquisition	4,670
Gross amount at which carried at end of period	8,072
Accumulated Depreciation & Depletion	97
Wash DC 1
Encumbrances	0
Initial Cost to Company	2,957
Cost capitalized subsequent to acquisition	9,858
Gross amount at which carried at end of period	12,815
Accumulated Depreciation & Depletion	2,866
Wash DC 2
Encumbrances	0
Initial Cost to Company	3,811
Cost capitalized subsequent to acquisition	2,404
Gross amount at which carried at end of period	6,215
Accumulated Depreciation & Depletion	0
Land Development and Construction Properties
Encumbrances	0
Initial Cost to Company	15,970
Cost capitalized subsequent to acquisition	24,698
Gross amount at which carried at end of period	40,668
Accumulated Depreciation & Depletion	$ 3,069

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Schedule III Real Estate and Accumulated Depreciation and Depletion Part 2 (Details)	12 Months Ended
	Sep. 30, 2016
Alachua, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Clayton, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Fayette, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Lake, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Lake, FL 2
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Lake Louise, FL
Year of Construction	n/a
Date acquired	5/12
Depreciation Life Computed on	unit
Lee, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Monroe, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Muscogee, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Prince Wil, VA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Putnam, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Putnam, FL 2
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	5 yr.
Spalding, GA
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	n/a
Marion, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	unit
Investment Property
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	n/a
Baltimore, MD 1
Year of Construction	1990
Date acquired	10/89
Depreciation Life Computed on	39 yr.
Baltimore, MD 2
Year of Construction	1994
Date acquired	12/91
Depreciation Life Computed on	39 yr.
Baltimore, MD 3
Year of Construction	2000
Date acquired	7/99
Depreciation Life Computed on	39 yr.
Baltimore, MD 4
Year of Construction	2008
Date acquired	12/02
Depreciation Life Computed on	39 yr.
Baltimore, MD 5
Year of Construction	n/a
Date acquired	6/15
Depreciation Life Computed on	39 yr.
Baltimore, MD 6
Year of Construction	1967
Date acquired	07/16
Depreciation Life Computed on	39 yr.
Baltimore City, MD
Year of Construction	2016
Date acquired	12/10
Depreciation Life Computed on	39 yr.
Baltimore City, MD 2
Year of Construction	n/a
Date acquired	6/13
Depreciation Life Computed on	39 yr.
Duval, FL
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	25 yr.
Harford, MD 1
Year of Construction	1998
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 2
Year of Construction	1999
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 3
Year of Construction	2001
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 5
Year of Construction	2007
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Harford, MD 6
Year of Construction	2009
Date acquired	8/95
Depreciation Life Computed on	39 yr.
Howard, MD 1
Year of Construction	1996
Date acquired	9/88
Depreciation Life Computed on	39 yr.
Howard, MD 2
Year of Construction	2000
Date acquired	3/00
Depreciation Life Computed on	39 yr.
Elkridge, MD
Year of Construction	TBD
Date acquired	10/15
Depreciation Life Computed on	39 yr.
Anne Arun, MD 1
Year of Construction	1989
Date acquired	9/88
Depreciation Life Computed on	39 yr.
Anne Arun, MD 2
Year of Construction	2003
Date acquired	5/98
Depreciation Life Computed on	39 yr.
Anne Arun, MD 3
Year of Construction	2005
Date acquired	8/04
Depreciation Life Computed on	39 yr.
Anne Arun, MD 4
Year of Construction	2006
Date acquired	1/03
Depreciation Life Computed on	39 yr.
Anne Arun, MD 5
Year of Construction	2012
Date acquired	7/07
Depreciation Life Computed on	39 yr.
Norfolk, VA
Year of Construction	2004
Date acquired	10/04
Depreciation Life Computed on	39 yr.
Prince Wil, VA 2
Year of Construction	2014
Date acquired	12/05
Depreciation Life Computed on	39 yr.
Newcastle Co, DE
Year of Construction	2004
Date acquired	4/04
Depreciation Life Computed on	39 yr.
Baltimore City, MD 3
Year of Construction	n/a
Date acquired	12/10
Depreciation Life Computed on	15 yr.
Carroll, MD
Year of Construction	n/a
Date acquired	3/08
Depreciation Life Computed on	n/a
Harford, MD 4
Year of Construction	n/a
Date acquired	8/95
Depreciation Life Computed on	n/a
Prince Wil, VA 3
Year of Construction	n/a
Date acquired	12/05
Depreciation Life Computed on	15 yr.
Wash DC 1
Year of Construction	n/a
Date acquired	4/86
Depreciation Life Computed on	15 yr.
Wash DC 2
Year of Construction	n/a
Date acquired	10/97
Depreciation Life Computed on	n/a

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Investments in Joint Ventures (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Jun. 30, 2013	Oct. 04, 2006
Total Investment	$ 23,854	$ 19,010
Total Assets of the Partnership	110,029	55,306
Net Loss of the Partnership	(1,273)	(188)
Company's share of Net Loss of the Partnership	(978)	(145)	$ (128)
Cash	352	61
Cash held in escrow	13	3,420
Amortizable Debt costs	1,179	1,593
Investments in real estate, net	108,485	50,232
Other liabilities	5,222	6,969
Long-term debt	63,495	17,000
Capital - FRP Holdings	23,854	19,010
Capital - Third parties	17,458	12,327
Total liabilities and capital	$ 110,029	$ 55,306
Riverfront I Joint Venture
Ownership percent	77.14%	76.91%		76.91%
Total Investment	$ 11,261	$ 11,517
Total Assets of the Partnership	85,106	40,970
Net Loss of the Partnership	(1,193)	(108)
Company's share of Net Loss of the Partnership	(938)	(105)
Cash	297	47
Cash held in escrow	13	3,420
Amortizable Debt costs	1,179	1,593
Investments in real estate, net	83,617	35,910
Other liabilities	5,140	6,905
Long-term debt	63,495	17,000
Capital - FRP Holdings	11,261	11,517
Capital - Third parties	5,210	5,548
Total liabilities and capital	85,106	40,970
Revenue	127	0	0
Cost of operations	1,040	108	89
Operating profit	(913)	(108)	(89)
Interest expense	(280)	0	0
Net loss of the Partnership	$ (1,193)	$ (108)	$ (89)
Brooksville Joint Venture
Ownership percent	50.00%	50.00%			50.00%
Total Investment	$ 7,496	$ 7,493
Total Assets of the Partnership	14,350	14,336
Net Loss of the Partnership	(80)	(80)
Company's share of Net Loss of the Partnership	(40)	(40)
Cash	35	14
Investments in real estate, net	14,315	14,322
Other liabilities	65	64
Capital - FRP Holdings	7,496	7,493
Capital - Third parties	6,789	6,779
Total liabilities and capital	$ 14,350	$ 14,336
BC FRP Realty Joint Venture
Ownership percent	50.00%
Total Investment	$ 5,097
Total Assets of the Partnership	10,573
Cash	20
Investments in real estate, net	10,553
Other liabilities	17
Capital - FRP Holdings	5,097
Capital - Third parties	5,459
Total liabilities and capital	10,573
BC FRP Realty Joint Venture
Net Loss of the Partnership	0
Company's share of Net Loss of the Partnership	$ 0

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Spin-off - Discontinued operations results of operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Revenue	$ 37,457	$ 34,646	$ 30,978
Cost of operations	21,074	22,465	21,238
Operating profit	16,383	12,181	9,740
Interest expense	(1,561)	(2,014)	(1,366)
Provision for income taxes	7,851	3,895	3,561
Income from discontinued operations	0	2,179	4,835
Patriot Transportation
Revenue	0	41,800	129,162
Cost of operations	0	38,195	121,134
Operating profit	0	3,605	8,028
Interest expense	0	(33)	(102)
Income before income taxes	0	3,572	7,926
Provision for income taxes	0	1,393	3,091
Income from discontinued operations	$ 0	$ 2,179	$ 4,835

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Assets and Liabilities of discontinued operations (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Property and equipment, net	$ 220,616	$ 207,205
Deferred costs	8,208	7,449
Other assets	178	275
Line of credit	6,807	8,494
Accounts payable and accrued liabilities	4,344	3,456
Deferred compensation	$ 1,453	$ 1,400
Patriot Transportation
Property and equipment, net			$ 42,174
Accounts receivable, net			7,119
Deferred costs			11,809
Other assets			32
Assets of discontinued operation			61,134
Line of credit			7,282
Accounts payable and accrued liabilities			11,489
Deferred compensation			717
Deferred income taxes			8,924
Liabilities of discontinued operation			$ 28,412

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Debt - Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015
Debt Disclosure [Abstract]
Revolving credit (uncollateralized)	$ 6,807	$ 8,494
5.6% to 7.9% mortgage notes due in installments through 2027	36,012	40,191
Long-term debt, current and non-current	42,819	48,685
Less portion due within one year	4,455	4,180
Total long term debt	$ 38,364	$ 44,505

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Leases - Carrying value of property leased or held for lease to others (Details) - Property leased or held for lease $ in Thousands	Sep. 30, 2016 USD ($)
Construction aggregates property	$ 35,292
Commercial property	270,911
Carrying Value of property owned by the Company leased or held for lease, gross	306,203
Less accumulated depreciation and depletion	79,479
Carrying Value of property owned by the Company leased or held for lease, net	$ 226,724

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Earnings Per Share - Earnings per share computations (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Earnings Per Share [Abstract]
Weighted average common shares oustanding during the period-shares used for basic earnings per common share	9,846	9,756	9,629
Common shares issuable under share based payment plans which are potentially dilutive	44	71	81
Common shares used for diluted earnings per common share	9,890	9,827	9,710
Income from continuing operations	$ 12,024	$ 6,093	$ 5,184
Discontinued operations	0	2,179	4,835
Net income	$ 12,024	$ 8,272	$ 10,019
Basic earnings per common share:
Income from continuing operations	$ 1.22	$ 0.62	$ 0.54
Discontinued operations	0.00	0.23	0.50
Net income	1.22	0.85	1.04
Diluted earnings per common share
Income from continuing operations	1.22	0.62	0.53
Discontinued operations	0.00	0.22	0.50
Net income	$ 1.22	$ 0.84	$ 1.03

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Stock-Based Compensation Plans - Stock Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock option grants	$ 166	$ 267	$ 441
Annual director stock award	412	536	698
Total Stock Compensation expense	$ 578	$ 803	$ 1,139

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Stock-Based Compensation Plans - Summary of changes in outstanding options (Details) $ / shares in Units, $ in Thousands	12 Months Ended
	Sep. 30, 2016 USD ($) Years $ / shares shares	Sep. 30, 2015 USD ($) Years $ / shares shares	Sep. 30, 2014 USD ($) Years $ / shares shares	Sep. 30, 2013 USD ($) Years $ / shares shares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Options outstanding | shares	263,560	305,750	326,830	414,591
Options granted | shares	21,540	39,425	31,790
Options exercised | shares	(63,730)	(72,300)	(119,550)
Options forfeited | shares		(6,000)
Spin-off conversion | shares		17,795
Options outstanding weighted average exercise price | $ / shares	$ 23.50	$ 21.90	$ 25.43	$ 20.40
Options outstanding weighted average exercise price - Granted | $ / shares	31.15	26.97	41.39
Options outstanding weighted average exercise price - forfeited | $ / shares		14.97
Options outstanding weighted average exercise price - Exercised | $ / shares	$ 18.39	13.31	$ 12.23
Options outstanding weighted average exercise price - Spin-off conversion | $ / shares		$ 20.63
Options outstanding weighted average remaining term | Years	5.6	5.9	5.0	4.2
Options outstanding weighted average grant date fair value | $	$ 2,539	$ 2,738	$ 3,481	$ 3,668
Options granted weighted average grant date fair value | $ / shares	$ 272	$ 432	$ 545
Options forfeited weighted average grant date fair value | $		$ (35)
Options exercised weighted average grant date fair value | $	$ (471)	(430)	$ (732)
Options Spin-off adjustment weighted average grant date fair value | $		(865)
Options Spin-off conversion weighted average grant date fair value | $		$ 155
Options exercisable at September 30, 2016 | shares	185,713
Options exercisable weighted average exercise price | $ / shares	$ 22.30
Options exerciseable weighted average remaining term | Years	4.7
Options exercisable weighted average grant date fair value | $	$ 1,621
Options vested during twelve months ended September 30, 2016 | shares	35,596
Options vested weighted average grant date fair value | $	$ 341

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Stock-Based Compensation Plans - Summary of Stock Options Outstanding (Details)	12 Months Ended
	Sep. 30, 2016 Years $ / shares shares	Sep. 30, 2015 Years $ / shares	Sep. 30, 2014 Years $ / shares	Sep. 30, 2013 Years $ / shares
Shares under option | shares	263,560
Weighted average exercise price	$ 23.50	$ 21.90	$ 25.43	$ 20.40
Weighted average remaining life | Years	5.6	5.9	5.0	4.2
$16.51 - $24.75 Exercisable
Shares under option | shares	19,756
Weighted average exercise price	$ 16.72
Weighted average remaining life | Years	5.2
Minimum exercise price	$ 16.51
Maximum exercise price	$ 24.75
$24.76 - $37.25 Exercisable
Shares under option | shares	142,473
Weighted average exercise price	$ 21.62
Weighted average remaining life | Years	4.2
Minimum exercise price	$ 24.76
Maximum exercise price	$ 37.25
$37.26 - $41.39 Exercisable
Shares under option | shares	23,484
Weighted average exercise price	$ 31.11
Weighted average remaining life | Years	7.7
Minimum exercise price	$ 37.26
Maximum exercise price	$ 41.39
$16.51 - $24.75 Non-exercisable
Shares under option | shares	5,539
Weighted average exercise price	$ 16.72
Weighted average remaining life | Years	5.2
Minimum exercise price	$ 16.51
Maximum exercise price	$ 24.75
$24.76 - $37.25 Non-exercisable
Shares under option | shares	40,692
Weighted average exercise price	$ 23.99
Weighted average remaining life | Years	7.4
Minimum exercise price	$ 24.76
Maximum exercise price	$ 37.25
$37.26 - $41.39 Non-exercisable
Shares under option | shares	31,616
Weighted average exercise price	$ 31.13
Weighted average remaining life | Years	8.2
Minimum exercise price	$ 37.26
Maximum exercise price	$ 41.39
Exercisable
Shares under option | shares	185,713
Weighted average exercise price	$ 22.30
Weighted average remaining life | Years	4.7
Non-exercisable
Shares under option | shares	77,847
Weighted average exercise price	$ 26.37
Weighted average remaining life | Years	7.6

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Income Taxes - Provision for income taxes for continuing operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Income Tax Disclosure [Abstract]
Federal, current	$ 4,807	$ 1,803	$ 2,820
State, current	1,165	524	1,083
Current income tax expense	5,972	2,327	3,903
Deferred	1,879	1,568	(342)
Provision for income taxes	7,851	3,895	3,561
Federal, computed at statutory rate	6,797	3,396	3,020
State income taxes (net of Federal income tax benefit)	1,002	504	520
Other, net	$ 52	$ (5)	$ 21

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Income Taxes - Deferred tax assets and deferred tax liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015
Income Tax Disclosure [Abstract]
Property and equipment	$ 15,197	$ 13,100
Depletion	526	496
Unrealized rents	1,823	1,881
Prepaid expenses	913	278
Gross deferred tax liabilities	18,459	15,755
Employee benefits and other	2,023	1,214
Gross deferred tax assets	2,023	1,214
Net deferred tax liability	$ 16,436	$ 14,541

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Business Segments - Business segments (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Segment Reporting Information [Line Items]
Revenues	$ 37,457	$ 34,646	$ 30,978
Operating profit	16,383	12,181	9,740
Corporate expenses	(3,080)	(4,388)	(5,224)
Unallocated to discontinued operations	0	(1,081)	(2,685)
Interest expense	1,561	2,014	1,366
Capital expenditures	27,554	6,493	19,283
Depreciation, depletion and amortization	8,051	7,378	6,705
Cash items	0	419	1,074
Discontinued operations identifiable net assets	0	0	61,134
Total identifiable net assets	265,676	252,478	313,071
Asset Management
Segment Reporting Information [Line Items]
Revenues	28,739	27,570	24,825
Operating profit	13,374	13,288	11,703
Corporate expenses	(1,591)	(1,248)	(958)
Interest expense	1,561	2,014	1,366
Capital expenditures	20,747	2,408	6,662
Depreciation, depletion and amortization	7,689	6,963	6,384
Identifiable net assets	171,449	151,023	154,976
Mining royalty lands
Segment Reporting Information [Line Items]
Revenues	7,533	6,094	5,349
Operating profit	7,029	5,478	4,735
Corporate expenses	(231)	(1,322)	(1,016)
Capital expenditures	205	0	0
Depreciation, depletion and amortization	104	133	124
Identifiable net assets	39,570	39,300	39,368
Land Development and Construction
Segment Reporting Information [Line Items]
Revenues	1,185	982	804
Operating profit	(940)	(2,197)	(1,474)
Corporate expenses	(1,258)	(737)	(565)
Capital expenditures	6,602	4,085	12,621
Depreciation, depletion and amortization	258	282	197
Identifiable net assets	54,157	60,682	56,519
Corporate
Segment Reporting Information [Line Items]
Identifiable net assets	$ 500	$ 1,054	$ 0

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Real Estate Business Park Acquisitions - Intangible asset amortization Transit Business Park (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Jun. 20, 2013
Below market leases initial values						$ 220	$ 220
Transit Forecasted amortization
In-place Leases	$ 17	$ 43	$ 43	$ 43	$ 44
Above Market Leases	$ 3	$ 4	$ 4	$ 4	$ 4
Transit Business Park
In-place leases initial value									$ 806
Above market leases initial value									48
Below market leases initial values									$ 156
In-place Leases						44	63	$ 369
Above Market Leases						4	4	12
Below Market Leases						$ 9	$ 37	$ 86

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Real Estate Business Park Acquisitions - Intangible asset amortization Kelso Business Park (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Jun. 06, 2014
Below market leases initial values					$ 220	$ 220
Kelso Forecasted amortization
In-place Leases annual amortization	$ 11	$ 21	$ 28	$ 100
Below Market Leases annual amortization			$ 2	$ 12
Kelso Business Park
In-place leases initial value								$ 579
Below market leases initial values								$ 64
In-place Leases annual amortization					136	203	$ 80
Below Market Leases annual amortization					$ 21	$ 21	$ 8

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Real Estate Business Park Acquisitions - Intangible asset amortization Port Capital Property (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2016	Oct. 19, 2015
Port Capital Forecasted amortization
In-place Leases annual amortization	$ 114	$ 114	$ 114	$ 114	$ 114
Port Capital Property
In-place leases initial value							$ 1,126
In-place Leases annual amortization						$ 104

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Real Estate Business Park Acquisitions - Intangible asset amortization Gilroy Road Property (Details) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Jul. 01, 2016
Gilroy Road Forecasted amortization
In-place Leases annual amortization	$ 222
Gilroy Road Property
In-place leases initial value			$ 277
In-place Leases annual amortization		$ 55

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Intangible assets and liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015
Amortizable asset carrying Amount	$ 2,836	$ 1,433
Amortizable asset accumulated Amortization	1,198	855
Below market lease carrying amount	220	220
Below market lease accumulated amortization	206	176
In place leases
Amortizable asset carrying Amount	2,788	1,385
Amortizable asset accumulated Amortization	1,175	836
Above Market leases
Amortizable asset carrying Amount	48	48
Amortizable asset accumulated Amortization	23	19
Below market leases
Below market lease carrying amount	220	220
Below market lease accumulated amortization	$ 206	$ 176

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Intangible assets and liabilities (Details) (Parenthetical)	12 Months Ended
	Sep. 30, 2016
In place leases
Useful life	7-8 years
Above Market leases
Useful life	5 years
Below market leases
Useful life	4-5 years

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Accounting Policies (Details Narrative) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2015	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014	Oct. 31, 2015
Patriot shares received	FRP's shareholders received one share of Patriot for every three shares of FRP owned on the record date.
Depreciation and depletion		$ 6,809	$ 6,195	$ 5,528
Reclass from deferred costs to long-term deferred tax liability					$ 143
Buildings and improvements
Estimated useful lives		3-39
Brooksville Joint Venture
Voting interest		50.00%
BC FRP Realty Joint Venture
Voting interest		50.00%

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Investments in Joint Ventures (Details Narrative) $ in Thousands	12 Months Ended
	Sep. 30, 2016 USD ($) ft² a	Sep. 30, 2015 USD ($)	Sep. 30, 2014 USD ($)	Sep. 30, 2013 USD ($)	Sep. 30, 2007 USD ($)	Aug. 08, 2014 USD ($)	Jun. 30, 2013 USD ($) ft² a	Oct. 04, 2006 USD ($) a
Capital contributions made	$ 929	$ 625	$ 5,266
Equity in the loss of the joint venture	978	145	$ 128
Joint Venture consolidated retained earnings	(990)	$ (389)
St Johns Properties JV Joint Venture
Value of land contributed	3,240
Initial cash distribution to FRP	$ 2,130
St Johns land contribution | a	10
Wash DC 1
Land acreage | a	5.82
Riverfront I Joint Venture
Square feet residential apartment building | ft²							300,000
Square feet | ft²							18,000
Land acreage | a							2
Value of land contributed				$ 13,500
Cash contributed				$ 4,866
Joint venture percentage stake	77.14%	76.91%					76.91%
MRP capital contribution							$ 5,553
EB5 Secondary financing						$ 17,000
Nonrecourse construction loan						$ 65,000
Book value of land contribution							$ 6,165
Equity in the loss of the joint venture	$ 938	$ 105
Brooksville Joint Venture
Land acreage | a								4,300
Joint venture percentage stake	50.00%	50.00%						50.00%
FRP land contribution previously leased to Vulcan | a								3,443
Book value of land contribution								$ 2,548
FRP and Vulcan additional acquisition costs					$ 3,018
Additional land acquired | a								288
Vulcan land contribution | a								553
Mandatory capital contribution obligation	$ 2,430
Capital contributions made	2,397
Equity in the loss of the joint venture	40	$ 40
BC FRP Realty Joint Venture
Value of land contributed	7,500
Equity in the loss of the joint venture	$ 0
BC FRP Realty Joint Venture
Square feet | ft²	329,000
Land acreage | a	25
Joint venture percentage stake	50.00%
Book value of land contribution	$ 6,828

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Related Party Transactions (Details Narrative) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Related Party Transactions [Abstract]
Charges/allocation related to Transition Services Agreement with Patriot	$ 1,542	$ 2,211	$ 2,539
Charges/allocations related to discontinued operations	$ 0	$ 1,081	$ 2,685

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Debt (Details Narrative) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2015 USD ($)	Sep. 30, 2016 USD ($)	Sep. 30, 2015 USD ($)	Sep. 30, 2014 USD ($)	Jan. 30, 2015 USD ($)
Mortgage interest description		5.6% to 7.9% mortgage notes due in installments through 2027
Principal payments 2017		$ 4,455
Principal payments 2018		4,673
Principal payments 2019		3,885
Principal payments 2020		3,725
Principal payments 2021		3,485
Principal payments 2022 and subsequent years		15,789
Carrying value of collateral on mortgage notes payable		45,478
Capitalized interest		$ 1,086	$ 1,041	$ 1,763
Mortgage prepayment	$ 1,314
Interest rates of prepaid mortgages	8.55% and 7.95%
Prepayment penalty	$ 116
Deferred loan costs on early prepayment	$ 15
First Tennessee bank Term Loan
Credit Agreement term years		10
Term loan facility		$ 20,000
Wells Fargo Bank, N.A.
Credit Agreement term years		5
Revolving Credit Agreement		$ 20,000			$ 55,000
Sublimit for standby letters of credit		$ 10,000
Revolver interest over LIBOR		1.4%
Commitment fee		0.15%
Letters of credit issued		$ 2,442
Borrowed under the revolver		5,765			$ 10,483
Available for borrowing		11,793
Tangible net worth covenant		110,000
Available to pay dividends or repurchase stock		$ 73,000
First Tennessee Bank
Credit Agreement term years		5
Revolving Credit Agreement		$ 20,000
Mortgage backed financing		$ 40,000
Revolver interest over LIBOR		1.9%
Commitment fee		0.10%
Revolver conversion to term loan		24 month window
Borrowed under the revolver		$ 1,042
Available for borrowing		$ 18,958

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Leases (Details Narrative) $ in Thousands	Sep. 30, 2016 USD ($)
Leases [Abstract]
Minimum future straight-lined rentals due on noncancelable leases 2017	$ 24,265
Minimum future straight-lined rentals due on noncancelable leases 2018	20,779
Minimum future straight-lined rentals due on noncancelable leases 2019	15,278
Minimum future straight-lined rentals due on noncancelable leases 2020	13,381
Minimum future straight-lined rentals due on noncancelable leases 2021	10,536
Minimum future straight-lined rentals due on noncancelable leases 2022 and subsequent years	$ 42,879

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Earnings Per Share (Details Narrative) - shares	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Earnings Per Share [Abstract]
Anti-dilutive shares	72,090	56,110	31,790

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Stock-Based Compensation Plans (Details Narrative) $ / shares in Units, $ in Thousands	12 Months Ended
	Sep. 30, 2016 USD ($) Years $ / shares shares	Jan. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Number of stock option plans	2
Expire date in years | Years	10
Exercisable installments	20% or 25%
Shares available for future issuance | shares	384,430
Dividend yield	0.00%
Expected minimum volatility	36.00%
Expected maximum volatility	46.00%
FRP options replacement		75.14%
Patriot options replacement		24.86%
Risk-free interest rate minimum	0.30%
Risk-free interest rate maximum	4.20%
Expected life minimum | Years	3.0
Expecited life maximum | Years	7.0
Aggregate intrinsic value of exercisable in-the-money options	$ 1,630
Aggregate intrinsic value of outstanding in-the-money options	$ 1,998
Market close price | $ / shares	$ 31.07
Gains realized by option holders	$ 913
Realized tax benefit from options exercised	353
Total compensation cost of options granted but not yet vested	$ 322
Weighted average period for compensation to be recognized | Years	3.4

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Income Taxes - Unrecognized tax benefits (Details Narrative) $ in Thousands	Sep. 30, 2016 USD ($)
Income Tax Disclosure [Abstract]
Unrecognized tax benefits	$ 0

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Employee Benefits (Details Narrative) - USD ($) $ in Thousands	12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Notes to Financial Statements
Company 401k contribution	50.00%	50.00%	50.00%
Savings/profit sharing plan company contribution	$ 51	$ 45	$ 40
Management Security Plan expense	161	163	$ 150
Management Security Plan accrued benefit	$ 1,485	$ 1,391

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Business Segments (Details Narrative)	12 Months Ended
	Sep. 30, 2016 a Segments
Reportable business segments | Segments	3
Brooksville Quarry, LLC
Mining royalty lands acres	4,280
Mining royalty lands
Mining royalty lands acres	15,000

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Fair Value Measurements (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2016	Sep. 30, 2015
Fair Value Disclosures [Abstract]
Assets measured at fair value on a recurring basis	$ 0
Liabilities measured at fair value on a recurring basis	0
Assets measured at fair value on a non-recurring basis	0
Liabilities measured at fair value on a non-recurring basis	0
Carrying amount of mortgage notes payable	42,819	$ 48,685
Fair value of mortgage notes payable	$ 46,216	$ 52,001

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Contingent Liabilities (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Contingent Liabilities Details Narrative
Cap on environment financial responsibility			$ 1,871
Environmental remediation expense	$ 2,000		(1,000)	$ 0	$ 0
Total cost of remediation			$ 1,900
Environmental remediation recovery		$ 3,000

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Commitments (Details Narrative) $ in Thousands	Sep. 30, 2016 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Purchase commitments	$ 7,055

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Concentrations (Details Narrative) $ in Thousands	12 Months Ended
	Sep. 30, 2016 USD ($) integer
Tenants leasing mining locations | integer	4
Mining Top Customer
Customer revenue concentration	15.60%
Accounts receivable concentration | $	$ 243
Asset Management Top Customer
Customer revenue concentration	11.00%

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Unusual or Infrequent Items Impacting Quarterly Results (Details Narrative) - USD ($) $ in Thousands	3 Months Ended			12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015	Mar. 31, 2015	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2014
Mortgage prepayment			$ 1,314
Interest rates of prepaid mortgages			8.55% and 7.95%
Prepayment penalty			$ 116
Deferred loan costs on early prepayment			$ 15
Environmental remediation recovery		$ 3,000
Gain on investment land sold				$ 6,029	$ (34)	$ 476
Environmental remediation expense	$ 2,000			$ (1,000)	$ 0	$ 0
Windlass Run Phase 2
Gain on investment land sold		$ 6,277

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Real Estate Business Park Acquisitions (Details Narrative) $ in Thousands	Jul. 01, 2016 USD ($) ft² a	Oct. 19, 2015 USD ($) ft² a	Jun. 06, 2014 USD ($) ft² a	Jun. 20, 2013 USD ($) ft² a
Transit Business Park
Approximate purchase price | $				$ 8,000
Number of buildings acquired				5
Land acreage | a				14.5
Square feet				232,318
Kelso Business Park
Approximate purchase price | $			$ 4,800
Number of buildings acquired			2
Land acreage | a			10.2
Square feet			69,680
Port Capital Property
Approximate purchase price | $		$ 9,900
Number of buildings acquired		1
Land acreage | a		6.39
Square feet		91,218
Mezzanine space square feet		29,558
Gilroy Road Property
Approximate purchase price | $	$ 8,300
Number of buildings acquired	1
Land acreage | a	7
Square feet	116,338
Mezzanine space square feet	8,900
Square footage footprint	107,438