Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended |
Sep. 30, 2014 | |
Document and Entity Information: | |
Entity Registrant Name | SECURITY LAND & DEVELOPMENT CORP |
Document Type | 10-K |
Document Period End Date | 30-Sep-14 |
Amendment Flag | FALSE |
Entity Central Index Key | 88572 |
Trading Symbol | sldv |
Current Fiscal Year End Date | -21 |
Entity Common Stock, Shares Outstanding | 5,243,107 |
Entity Filer Category | Smaller Reporting Company |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Well-known Seasoned Issuer | No |
Document Fiscal Year Focus | 2014 |
Document Fiscal Period Focus | FY |
Entity Public Float | $1,481,648 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
CURRENT ASSETS | ||
Cash | $65,982 | $24,599 |
Receivables from tenants, net of allowance of $43,578 and $19,938 at September 30, 2014 and September 30, 2013, respectively | 527,579 | 497,324 |
Prepaid property taxes | 15,003 | |
Total current assets | 593,561 | 536,926 |
INVESTMENT PROPERTIES | ||
Investment properties for lease, net of accumulated depreciation | 5,459,560 | 5,415,447 |
Land and improvements held for investment or development | 3,639,598 | 3,639,598 |
Total Investment Properties | 9,099,158 | 9,055,045 |
OTHER ASSETS | 76,239 | 76,188 |
Total Assets | 9,768,958 | 9,668,159 |
CURRENT LIABILITIES | ||
Accounts payable and accrued expenses | 452,669 | 325,720 |
Income taxes payable | 229,031 | 183,236 |
Current maturities of notes payable | 554,065 | 584,491 |
Current maturities of deferred revenue | 18,489 | 24,652 |
Current note payable to stockholder | 50,433 | |
Total current liabilities | 1,304,687 | 1,118,099 |
LONG-TERM LIABILITIES | ||
Notes payable, less current portion | 2,435,541 | 2,807,314 |
Deferred income taxes | 737,230 | 764,645 |
Deferred revenue, less current portion | 16,419 | |
Total long-term liabilities | 3,172,771 | 3,588,378 |
Total liabilities | 4,477,458 | 4,706,477 |
Commitments and Contingencies (Note 5) | ||
STOCKHOLDERS' EQUITY | ||
Common stock, par value $.10 per share; 30,000,000 shares authorized; 5,243,107 shares issued and outstanding | 524,311 | 524,311 |
Additional paid-in capital | 333,216 | 333,216 |
Retained earnings | 4,433,973 | 4,104,155 |
Total Stockholders' Equity | 5,291,500 | 4,961,682 |
Liabilities and Stockholders' Equity | $9,768,958 | $9,668,159 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
Statement of Financial Position [Abstract] | ||
Receivables from tenants net of allowance (in dollars) | $43,578 | $19,938 |
Common Stock, Par Value (in dollars per share) | $0.10 | $0.10 |
Common Stock, Shares Authorized | 30,000,000 | 30,000,000 |
Common Stock, shares issued | 5,243,107 | 5,243,107 |
Common Stock, shares outstanding | 5,243,107 | 5,243,107 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS (USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
OPERATING REVENUE | ||
Rent revenue | $1,481,648 | $1,429,995 |
OPERATING EXPENSES | ||
Depreciation and amortization | 148,628 | 131,791 |
Property taxes | 267,494 | 255,875 |
Payroll and related costs | 78,534 | 83,671 |
Insurance and utilities | 56,090 | 56,117 |
Repairs and maintenance | 41,624 | 35,294 |
Professional services | 125,482 | 73,428 |
Bad debt | 23,640 | 16,528 |
Penalties | 18,045 | |
Other | 4,217 | 6,869 |
Total Operating Expenses | 745,709 | 677,618 |
Operating income | 735,939 | 752,377 |
OTHER EXPENSE | ||
Gain on sale of land | 108,300 | |
Interest | -199,847 | -234,088 |
Other income/expense | 29 | |
Total other income (expense) | -199,847 | -125,759 |
Income before income taxes | 536,092 | 626,618 |
INCOME TAXES PROVISION (BENEFIT) | ||
Income tax expense | 233,689 | 251,535 |
Income tax deferred benefit | -27,415 | -7,202 |
Income tax expense | 206,274 | 244,333 |
Net income | 329,818 | 382,285 |
RETAINED EARNINGS, BEGINNING OF YEAR | 4,104,155 | 3,721,870 |
RETAINED EARNINGS, END OF YEAR | $4,433,973 | $4,104,155 |
PER SHARE DATA | ||
Net income per common share (in dollars per share) | $0.06 | $0.07 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
OPERATING ACTIVITIES | ||
Net income | $329,818 | $382,285 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Gain on sale of land | -108,300 | |
Bad debts | 23,640 | 16,528 |
Depreciation and amortization | 148,628 | 131,791 |
Changes in deferred and accrued amounts: | ||
Receivables from tenants | -53,895 | -115,514 |
Prepaid property taxes | 15,003 | -15,003 |
Accounts payable and accrued expenses | 126,949 | -56,522 |
Income taxes payable | 45,795 | -100,511 |
Deferred income tax | -27,415 | -7,202 |
Deferred revenue | -22,582 | -24,652 |
Net cash provided by operating activities | 585,941 | 102,900 |
INVESTING ACTIVITIES | ||
Proceeds from sale of land | 156,000 | |
Additions to investment properties and other assets for improvements to property held for lease | -192,792 | |
Net cash (used in) provided by investing activities | -192,792 | 156,000 |
FINANCING ACTIVITIES | ||
Repayments to stockholder | -30,000 | |
Proceeds from stockholder | 50,433 | 30,000 |
Proceeds from notes payable | 186,804 | 404,235 |
Principal payments on notes payable | -589,003 | -687,303 |
Net cash used in financing activities | -351,766 | -283,068 |
Net increase (decrease) | 41,383 | -24,168 |
CASH, BEGINNING OF YEAR | 24,599 | 48,767 |
CASH, END OF YEAR | 65,982 | 24,599 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest | 203,109 | 236,502 |
Cash paid for income taxes | $187,894 | $340,613 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES | 12 Months Ended | ||
Sep. 30, 2014 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES | NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES | ||
Business activities | |||
Security Land and Development Corporation (“the Company”) is engaged in the acquisition of developed and undeveloped real estate to be held for investment purposes or to be developed and leased as income producing property. Substantially all investment properties held and leased by the Company are located within the State of Georgia, in Richmond and Columbia counties and in North Augusta, South Carolina. | |||
Royal Palms Motel, Inc., a wholly owned subsidiary of Security Land and Development Corporation, is a holding company for a parcel of land in Richmond County, Georgia. During 2004, the Company organized, as its sole member, SLDC, LLC, a Georgia limited liability company. During 2007, the Company organized, as its sole member, SLDC2, LLC, a Georgia limited liability company. During 2008, the Company organized, as its sole member, SLDC III, LLC, a South Carolina limited liability company. SLDC, LLC, SLDC2, LLC, and SLDC III, LLC were organized by the Company to hold title to certain real estate that the Company plans to develop. | |||
During 2014 and 2013, substantially all operating revenues and operating expenses were related to real estate leasing and a gain on the sale of land. A substantial portion of rent revenues were earned from two investment properties, a commercial retail center, consisting of approximately 69,000 square feet on Washington Road in Augusta, Georgia (“National Plaza”) and the Evans Ground Lease on Washington Road in Evans, Georgia (“Evans Ground Lease”). National Plaza provided approximately 50% of gross rent revenue in 2014 and 49% in 2013. Approximately 81% of National Plaza was leased to a regional food supermarket, with annual rents from the lease totaling $463,200. National Plaza comprises approximately 53% of the asset Investment Properties for Lease, net of Accumulated Depreciation. The Evans Ground Lease provided approximately 45% and 46% of gross rental revenue in 2014 and 2013, respectively. This property, leased to a national home improvement retailer, earned rents totaling approximately $539,000 and $526,000 in 2014 and 2013, respectively. The Evans Ground Lease comprises approximately 44% of investment properties held for lease, net, by the Company at September 30, 2014. During 2013 the Company sold a minor portion of the land containing the Evans Ground Lease as a right of way and recognized a gain of approximately $108,000. | |||
Basis of presentation | |||
The Company prepares its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of Security Land and Development Corporation and its wholly owned subsidiaries, Royal Palms Motel, Inc., SLDC, LLC, SLDC2, LLC, and SLDC III, LLC (described on a consolidated basis as the “Company”). All intercompany transactions and accounts are eliminated in consolidation. | |||
Use of estimates | |||
The consolidated financial statements include estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |||
Revenue recognition | |||
Rent revenue is recognized on a straight-line basis over the term of the related lease agreements. The Company is reimbursed by tenants for property taxes and other maintenance fees. These reimbursements billed totaled $271,964 and $267,289, which is included in rent revenue, for the years ended September 30, 2014 and 2013, respectively. | |||
Gains, or losses, realized from sales of real estate are recognized substantially when title to the property has passed and the risks and benefits of ownership have been transferred to the buyer. | |||
Investment properties | |||
Investment properties are stated at cost. Depreciation of the investment properties is computed principally using the straight-line method over the following estimated useful lives: | |||
Buildings for lease | 30 - 40 years | ||
Land improvements on property for lease | 15 years | ||
Fixtures and furnishings | 5 - 7 years | ||
Major renewals or improvements on investment properties are capitalized, while maintenance and repairs that do not improve or extend the useful lives of the assets are charged to expense when incurred. Upon retirement, sale or other disposition of investment properties, the cost and accumulated depreciation are eliminated from the accounts and the gain or loss is included in income in the period of disposition. | |||
The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating recoverability, the Company generally estimates future cash flows expected to result from the use of the asset and its eventual disposition. An impairment loss is recognized when the expected future cash flows of the asset is less than the carrying amount. The Company measures the impairment loss as the amount by which the asset's carrying amount exceeds the fair value of the asset. At September 30, 2014 and 2013, the Company believes that none of its long-lived assets are impaired. | |||
Receivables from tenants | |||
Receivables from tenants consist of rents, property taxes and other maintenance fees payable under the terms of lease agreements. Receivables are carried at original invoice amount. Management estimates an allowance for doubtful accounts by regularly evaluating individual tenant receivables and considering the collectability of balances due based on each tenant’s financial condition, credit history, and current economic conditions. Receivables are written off when deemed uncollectible. Recoveries of receivables previously written off are recognized in income when received. The Company has an allowance for uncollectible accounts of $43,578 and $19,938 at September 30, 2014 and 2013, respectively. | |||
Lease commissions | |||
Lease commissions are capitalized and amortized over the term of the related leases, using the straight-line method. Lease commissions, net of accumulated amortization, of $32,459 and $28,928 at September 30, 2014 and 2013, respectively, are included in Other Assets in the accompanying consolidated balance sheets. | |||
Loan Fees | |||
Loan fees are capitalized and amortized over the term of the loan using the straight-line method. Loan fees, net of accumulated amortization, were $43,780 and $47,260 at September 30, 2014 and 2013, respectively. Loan fees are included in Other Assets in the accompanying consolidated balance sheets. | |||
Income taxes | |||
The Company files a consolidated income tax return. Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the financial reporting basis and income tax basis of assets and liabilities. Deferred tax assets and liabilities represent future tax consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are adjusted for changes in tax laws and tax rates when those changes are enacted. | |||
The Company has adopted the provisions under ASC Topic 740, “Income Taxes” (“ASC 740”) which requires that a position taken or expected to be taken in a tax return be recognized in the financial statements when it is more likely than not (i.e., a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon settlement. The Company recognizes accrued interest and penalties related to uncertain tax positions as a component of income tax expense in its financial statements. Management is not aware of any uncertain tax positions as of September 30, 2014 and 2013. The Company believes it is no longer subject to income tax examination for the fiscal years prior to 2011. | |||
Statements of equity | |||
There were no changes in equity other than net income for the years ended September 30, 2014 and 2013. | |||
Net income per common share | |||
Net income per common share is calculated on the basis of the weighted average number of shares outstanding. The Company has no stock option plans, or other instruments resulting in earnings per share dilution. For 2014 and 2013 the weighted average number of shares outstanding was 5,243,107. Therefore, only basic net income per common share is presented. | |||
Recently issued accounting standards | |||
On April 22, 2013, the FASB issued guidance addressing application of the liquidation basis of accounting. The guidance is intended to clarify when an entity should apply the liquidation basis of accounting. In addition, the guidance provides principles for the recognition and measurement of assets and liabilities and requirements for financial statements prepared using the liquidation basis of accounting. The amendments are effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein and those requirements should be applied prospectively from the day that liquidation becomes imminent. Early adoption is permitted. These amendments do not have any effect on the financial statements. | |||
On July 18, 2013, the FASB issued guidance to eliminate the diversity in practice regarding presentation of unrecognized tax benefits in the statement of financial position. Under the clarified guidance, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, will be presented in the financial statements as a reduction to a deferred tax asset unless certain criteria are met. The requirements should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The amendments were effective for the Company for reporting periods beginning after December 15, 2013. These amendments did not have a material effect on the financial statements. | |||
In December 2013, the FASB amended the Master Glossary of the FASB Codification to define “Public Business Entity” to minimize the inconsistency and complexity of having multiple definitions of, or a diversity in practice as to what constitutes, a nonpublic entity and public entity within U.S. GAAP. The amendment does not affect existing requirements, however will be used by the FASB, the Private Company Council (“PCC”), and the Emerging Issues Task Force (“EITF”) in specifying the scope of future financial accounting and reporting guidance. The Company does not expect this amendment to have any effect on the financial statements. | |||
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts (Topic 606). The new standard is effective for reporting periods beginning after December 15, 2016 and early adoption is not permitted. The comprehensive new standard will supersede existing revenue recognition guidance and require revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the Company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. The guidance permits two implementation approaches, one requiring retrospective application of the new standard with restatement of prior years and one requiring prospective application of the new standard with disclosure of results under old standards. The Company is currently evaluation the impacts of adoption and the implementation approach to be used. | |||
In August 2014, the FASB issued guidance that is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. In connection with preparing financial statements, management will need to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the organization’s ability to continue as a going concern within one year after the date that the financial statements are issued. The amendments will be effective for the Company for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company does not expect these amendments to have a material effect on its financial statements. | |||
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. | |||
Concentrations | |||
Substantially all of the Company’s assets consist of real estate located in Richmond and Columbia Counties in the State of Georgia, and in North Augusta, South Carolina. In 2014 and 2013, approximately 99% and 93%, respectively, of the Company’s revenues were rental related revenue. In 2014 and 2013, approximately 50% and 49%, respectively, of the Company’s rental revenues were earned from National Plaza. Approximately 81% of National Plaza is leased to one tenant, a regional food supermarket. Approximately 45% and 46% of the Company’s rental revenues in 2014 and 2013, respectively, were earned from the Evans Ground Lease, which is 100% leased to a major national home improvement retailer. | |||
The majority of the Company’s receivables from tenants at September 30, 2014 and 2013 were receivable from two tenants, the regional food supermarket that leases property at National Plaza, and the major national home improvement retailer under the Evans Ground Lease. | |||
The Company places its cash with high quality financial institutions. At times the Company’s cash balances may be in excess of Federal Deposit Insurance Corporation limits. | |||
Subsequent events | |||
Subsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued. Recognized subsequent events are events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements. Unrecognized subsequent events are events that provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date. | |||
In the first quarter of fiscal year 2015, the Company borrowed $15,000 from a member of the Company’s Board of Directors to meet short term cash flow needs. | |||
In the first quarter of fiscal year 2015, the Company received a signed letter of intent from Publix to exercise an option pursuant to original lease agreement and extend lease through June 2020. The Company also received a lease amendment from Edward D. Jones & Co. to exercise the option and extend their lease through January 2020. | |||
Management has reviewed events occurring through the date the financial statements were issued and no other subsequent events occurred that require accrual or disclosure. |
INVESTMENT_PROPERTIES
INVESTMENT PROPERTIES | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
INVESTMENT PROPERTIES | ||||||||
INVESTMENT PROPERTIES | NOTE 2 - INVESTMENT PROPERTIES | |||||||
Investment properties leased or held for lease | ||||||||
Investment properties leased or held for lease to others under operating leases consist of the following at September 30: | ||||||||
2014 | 2013 | |||||||
National Plaza building, land and improvements | $ | 5,325,348 | $ | 5,138,796 | ||||
Evans Ground Lease, land and improvements | 2,382,673 | 2,382,673 | ||||||
Commercial land and improvements | 3,639,598 | 3,639,598 | ||||||
11,347,619 | 11,161,067 | |||||||
Less accumulated depreciation | (2,360,803 | ) | (2,221,077 | ) | ||||
8,986,816 | 8,939,990 | |||||||
Residential rental property | 145,847 | 145,847 | ||||||
Less accumulated depreciation | (33,505 | ) | (30,792 | ) | ||||
112,342 | 115,055 | |||||||
Investment properties for lease, net of depreciation | $ | 9,099,158 | $ | 9,055,045 | ||||
Depreciation expense totaled $142,439 and $125,217 in 2014 and 2013, respectively. | ||||||||
Approximately 81% of National Plaza is leased to a regional food supermarket. The lease requires minimum annual rental payments of $463,200, expires in 2015 and is renewable for a total of an additional twenty years at substantially similar lease terms. The lease provides for the supermarket to pay for interior maintenance and utilities and property taxes on a proportional basis. | ||||||||
The lease agreement also provides for the Company to receive each year 1.25% of the individual supermarket’s gross sales in excess of approximately $37 million. For 2014 and 2013, the supermarket did not achieve this gross sales level. | ||||||||
In construction of National Plaza, the supermarket contributed approximately $493,000 to the cost of the construction. The Company recorded the $493,000 as deferred revenue and is recognizing $24,652 as revenue annually using the straight-line method over the twenty-year life of the lease with the supermarket. | ||||||||
In 2003, the Company entered into a 20-year ground lease arrangement on an outparcel of National Plaza. The ground lease provides for minimum rent of $45,000 annually, for the first 10 years of the lease. The minimum rent increases by approximately 10% after year 10 and then again after year 15 of the ground lease. Other lease agreements at National Plaza range in terms from one to five years. | ||||||||
The Company entered into a long-term ground lease with a major national home improvement retailer tenant and its developer in May 2006 on the approximately 18 acres of land in Columbia County, Georgia. The agreement required monthly rental payments of $20,833 during the development period, which was completed in January of 2007. Following the expiration of the development period, the lease requires annual rental payments of $500,000 for the first 5 years then increasing 5% in years 6, 11, and 16. The lease has an option to renew at year 21 and another option every 5 years thereafter for a possible total lease term of 50 years. The lease provides for the tenant to pay for insurance and property taxes. | ||||||||
Future minimum rents receivable under the operating lease agreements are as follows for the years ending September 30: | ||||||||
2015 | $ | 997,337 | ||||||
2016 | 682,836 | |||||||
2017 | 702,523 | |||||||
2018 | 703,486 | |||||||
2019 | 657,796 | |||||||
Thereafter | 4,343,104 | |||||||
$ | 8,087,082 | |||||||
Land and improvements held for investment or development | ||||||||
The Company also holds for investment or future development approximately 19.38 acres of undeveloped commercial land in North Augusta, South Carolina, purchased in several parcels during 2007 and 2008. The Company also owns approximately 85 acres of land in south Richmond County and a 1.1 acre parcel along Washington Road in Augusta, Georgia, that adjoins the Company’s National Plaza investment property. The aggregate cost of these investment properties held for investment or development was $3,639,598 at September 30, 2014 and 2013. |
NOTES_PAYABLE
NOTES PAYABLE | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
NOTES PAYABLE | NOTE 3 – NOTES PAYABLE | |||||||
Notes payable consisted of the following at September 30: | ||||||||
2014 | 2013 | |||||||
A construction loan to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The loan was procured to finance tenant improvements for the lease of in-line space at National Plaza executed on January 17, 2014. In April, 2014 construction of the tenant improvements was completed and with total principal borrowed of $186,804. The note converted to a note payable with monthly installments of $3,728 including interest over a 60 month term with fixed interest of 4.25%. The related lease agreement calls for monthly payments of this amount to be paid to the Company in addition to monthly minimum rental payments. | $ | 181,504 | $ | - | ||||
In November of 2012, the Company converted a previous line of credit to a fixed rate loan due December 2017. The new term loan accrues interest at a 5.5% annually with monthly installments of $3,287. The current balance relates to the purchase of the 1 acre adjoining the North Augusta, South Carolina property in May 2008 and is collateralized by the residential property on Stanley Drive in Augusta, Georgia. | 260,323 | 284,531 | ||||||
A note payable to an insurance company, secured with a mortgage interest in National Plaza and an assignment of rents. The note is payable in monthly installments of $35,633, including interest, through June 2015, and bears interest at a fixed rate of 7.875%. | 310,423 | 696,892 | ||||||
A note payable to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The note is payable in monthly installments of $7,563, including principal and interest, through July 2018, and bears interest at a fixed rate of 5%. | 319,330 | 392,945 | ||||||
A note payable without collateral to a stockholder, who is also a member of the Flanagin Family, to meet the cash flow needs of the Company. The note matures in July of 2015 and accrues interest at 5%. | 50,433 | - | ||||||
A note payable to an insurance company collateralized with approximately 17 acres of land in Columbia County, Georgia, and an assignment of the long-term ground lease. The note is payable in monthly installments of $17,896, including interest, through May 1, 2027, and bears interest at a fixed rate of 5.85%. | 1,918,026 | 2,017,437 | ||||||
3,040,039 | 3,391,805 | |||||||
Less current maturities | (604,498 | ) | (584,491 | ) | ||||
$ | 2,435,541 | $ | 2,807,314 | |||||
Aggregate maturities of notes payable are as follows at September 30, 2014: | ||||||||
2015 | $ | 604,498 | ||||||
2016 | 257,040 | |||||||
2017 | 271,144 | |||||||
2018 | 418,350 | |||||||
2019 | 167,730 | |||||||
Thereafter | 1,321,277 | |||||||
$ | 3,040,039 | |||||||
All interest incurred for 2014 and 2013 was expensed by the Company. | ||||||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ||||||||
INCOME TAXES | NOTE 4 – INCOME TAXES | |||||||
Deferred income taxes are the result of qualified tax-free exchanges of property transacted in previous years and reporting depreciation differently for income tax purposes. The tax effects of temporary differences that give rise to the deferred tax liability are as follows as of September 30: | ||||||||
2014 | 2013 | |||||||
Deferred income tax liabilities: | ||||||||
Basis in Investment Properties | $ | 737,230 | $ | 764,645 | ||||
Taxable gains deferred by the Company in prior years through qualified tax-free like-kind exchanges totaled approximately $973,000. These deferred gains for tax reporting comprise a substantial portion of the Company's deferred income tax liabilities as of September 30, 2014 and 2013, net of the effects of depreciation. | ||||||||
The provision for income taxes is as follows: | ||||||||
For the years ended | ||||||||
September 30, | ||||||||
2014 | 2013 | |||||||
Current expense | $ | 233,689 | $ | 251,535 | ||||
Deferred benefit | (27,415 | ) | (7,202 | ) | ||||
$ | 206,274 | $ | 244,333 | |||||
The provision for income taxes for the years ended September 30, 2014 and 2013 differs from the amount obtained by applying the U.S. federal and state income tax rate to pretax income due to the following: | ||||||||
2014 | 2013 | |||||||
Net income before tax | $ | 536,092 | $ | 626,618 | ||||
Expected federal tax expense at 34% | 182,271 | 213,050 | ||||||
State tax expense, net of federal benefit | 21,229 | 24,814 | ||||||
Permanent differences | - | 6,850 | ||||||
Other | 2,774 | (381 | ) | |||||
Tax expense | $ | 206,274 | $ | 244,333 | ||||
The Company has a total outstanding income tax payable in the amount of $229,031 and $183,236, respectively, at September 30, 2014 and 2013. |
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Sep. 30, 2014 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 5 – RELATED PARTY TRANSACTIONS |
The Company purchases insurance from an insurance company of which a member of the Company’s Board of Directors is President. The Company’s Board of Directors believes that the insurance prices obtained from such company were not in excess of prices that would have been paid had the Company obtained this insurance from other sources. | |
The Company has hired an attorney who is a member of the Company’s Board of Directors. This attorney was hired to represent the Company in defending a claim brought by a tenant in relation to some disputed lease related charges. Receivables from tenant at September 30, 2014 include rents and reimbursements for property taxes and other maintenance fees that are part of this dispute. The Company has accrued approximately $150,000 for professional fees and other expenses to defend its position. The Company’s Management and their attorney believe that this claim is without merit. Total fees paid during the year were $19,502 and $6,596, respectively, for the years ended September 30, 2014 and 2013. | |
In the second quarter of fiscal year 2014, the Company borrowed $50,000 from a stockholder, who is also a member of the Flanagin family, to meet short term cash flow needs. Interest on this balance is accruing at 5%. | |
Subsequent to year-end, in the first quarter of fiscal year 2015, the Company borrowed $15,000 from a member of the Company’s board of Directors to meet short term cash flow needs. | |
During the year, the Company paid $4,250 to a stockholder who is also the son of the President for accounting services. The Company believes the amount paid is not in excess of prices that would have been paid had the Company obtained these services from other sources. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES (Policies) | 12 Months Ended | ||
Sep. 30, 2014 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Business activities | Business activities | ||
Security Land and Development Corporation (“the Company”) is engaged in the acquisition of developed and undeveloped real estate to be held for investment purposes or to be developed and leased as income producing property. Substantially all investment properties held and leased by the Company are located within the State of Georgia, in Richmond and Columbia counties and in North Augusta, South Carolina. | |||
Royal Palms Motel, Inc., a wholly owned subsidiary of Security Land and Development Corporation, is a holding company for a parcel of land in Richmond County, Georgia. During 2004, the Company organized, as its sole member, SLDC, LLC, a Georgia limited liability company. During 2007, the Company organized, as its sole member, SLDC2, LLC, a Georgia limited liability company. During 2008, the Company organized, as its sole member, SLDC III, LLC, a South Carolina limited liability company. SLDC, LLC, SLDC2, LLC, and SLDC III, LLC were organized by the Company to hold title to certain real estate that the Company plans to develop. | |||
During 2014 and 2013, substantially all operating revenues and operating expenses were related to real estate leasing and a gain on the sale of land. A substantial portion of rent revenues were earned from two investment properties, a commercial retail center, consisting of approximately 69,000 square feet on Washington Road in Augusta, Georgia (“National Plaza”) and the Evans Ground Lease on Washington Road in Evans, Georgia (“Evans Ground Lease”). National Plaza provided approximately 50% of gross rent revenue in 2014 and 49% in 2013. Approximately 81% of National Plaza was leased to a regional food supermarket, with annual rents from the lease totaling $463,200. National Plaza comprises approximately 53% of the asset Investment Properties for Lease, net of Accumulated Depreciation. The Evans Ground Lease provided approximately 45% and 46% of gross rental revenue in 2014 and 2013, respectively. This property, leased to a national home improvement retailer, earned rents totaling approximately $539,000 and $526,000 in 2014 and 2013, respectively. The Evans Ground Lease comprises approximately 44% of investment properties held for lease, net, by the Company at September 30, 2014. During 2013 the Company sold a minor portion of the land containing the Evans Ground Lease as a right of way and recognized a gain of approximately $108,000. | |||
Basis of presentation | Basis of presentation | ||
The Company prepares its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of Security Land and Development Corporation and its wholly owned subsidiaries, Royal Palms Motel, Inc., SLDC, LLC, SLDC2, LLC, and SLDC III, LLC (described on a consolidated basis as the “Company”). All intercompany transactions and accounts are eliminated in consolidation. | |||
Use of estimates | Use of estimates | ||
The consolidated financial statements include estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. | |||
Revenue recognition | Revenue recognition | ||
Rent revenue is recognized on a straight-line basis over the term of the related lease agreements. The Company is reimbursed by tenants for property taxes and other maintenance fees. These reimbursements billed totaled $271,964 and $267,289, which is included in rent revenue, for the years ended September 30, 2014 and 2013, respectively. | |||
Gains, or losses, realized from sales of real estate are recognized substantially when title to the property has passed and the risks and benefits of ownership have been transferred to the buyer. | |||
Investment properties | Investment properties | ||
Investment properties are stated at cost. Depreciation of the investment properties is computed principally using the straight-line method over the following estimated useful lives: | |||
Buildings for lease | 30 - 40 years | ||
Land improvements on property for lease | 15 years | ||
Fixtures and furnishings | 5 - 7 years | ||
Major renewals or improvements on investment properties are capitalized, while maintenance and repairs that do not improve or extend the useful lives of the assets are charged to expense when incurred. Upon retirement, sale or other disposition of investment properties, the cost and accumulated depreciation are eliminated from the accounts and the gain or loss is included in income in the period of disposition. | |||
The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating recoverability, the Company generally estimates future cash flows expected to result from the use of the asset and its eventual disposition. An impairment loss is recognized when the expected future cash flows of the asset is less than the carrying amount. The Company measures the impairment loss as the amount by which the asset's carrying amount exceeds the fair value of the asset. At September 30, 2014 and 2013, the Company believes that none of its long-lived assets are impaired. | |||
Receivables from tenants | Receivables from tenants | ||
Receivables from tenants consist of rents, property taxes and other maintenance fees payable under the terms of lease agreements. Receivables are carried at original invoice amount. Management estimates an allowance for doubtful accounts by regularly evaluating individual tenant receivables and considering the collectability of balances due based on each tenant’s financial condition, credit history, and current economic conditions. Receivables are written off when deemed uncollectible. Recoveries of receivables previously written off are recognized in income when received. The Company has an allowance for uncollectible accounts of $43,578 and $19,938 at September 30, 2014 and 2013, respectively. | |||
Lease commissions | Lease commissions | ||
Lease commissions are capitalized and amortized over the term of the related leases, using the straight-line method. Lease commissions, net of accumulated amortization, of $32,459 and $28,928 at September 30, 2014 and 2013, respectively, are included in Other Assets in the accompanying consolidated balance sheets. | |||
Loan Fees | Loan Fees | ||
Loan fees are capitalized and amortized over the term of the loan using the straight-line method. Loan fees, net of accumulated amortization, were $43,780 and $47,260 at September 30, 2014 and 2013, respectively. Loan fees are included in Other Assets in the accompanying consolidated balance sheets. | |||
Income taxes | Income taxes | ||
The Company files a consolidated income tax return. Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the financial reporting basis and income tax basis of assets and liabilities. Deferred tax assets and liabilities represent future tax consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are adjusted for changes in tax laws and tax rates when those changes are enacted. | |||
The Company has adopted the provisions under ASC Topic 740, “Income Taxes” (“ASC 740”) which requires that a position taken or expected to be taken in a tax return be recognized in the financial statements when it is more likely than not (i.e., a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon settlement. The Company recognizes accrued interest and penalties related to uncertain tax positions as a component of income tax expense in its financial statements. Management is not aware of any uncertain tax positions as of September 30, 2014 and 2013. The Company believes it is no longer subject to income tax examination for the fiscal years prior to 2011. | |||
Statements of equity | Statements of equity | ||
There were no changes in equity other than net income for the years ended September 30, 2014 and 2013. | |||
Net income per common share | Net income per common share | ||
Net income per common share is calculated on the basis of the weighted average number of shares outstanding. The Company has no stock option plans, or other instruments resulting in earnings per share dilution. For 2014 and 2013 the weighted average number of shares outstanding was 5,243,107. Therefore, only basic net income per common share is presented. | |||
Recently issued accounting standards | Recently issued accounting standards | ||
On April 22, 2013, the FASB issued guidance addressing application of the liquidation basis of accounting. The guidance is intended to clarify when an entity should apply the liquidation basis of accounting. In addition, the guidance provides principles for the recognition and measurement of assets and liabilities and requirements for financial statements prepared using the liquidation basis of accounting. The amendments are effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein and those requirements should be applied prospectively from the day that liquidation becomes imminent. Early adoption is permitted. These amendments do not have any effect on the financial statements. | |||
On July 18, 2013, the FASB issued guidance to eliminate the diversity in practice regarding presentation of unrecognized tax benefits in the statement of financial position. Under the clarified guidance, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, will be presented in the financial statements as a reduction to a deferred tax asset unless certain criteria are met. The requirements should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The amendments were effective for the Company for reporting periods beginning after December 15, 2013. These amendments did not have a material effect on the financial statements. | |||
In December 2013, the FASB amended the Master Glossary of the FASB Codification to define “Public Business Entity” to minimize the inconsistency and complexity of having multiple definitions of, or a diversity in practice as to what constitutes, a nonpublic entity and public entity within U.S. GAAP. The amendment does not affect existing requirements, however will be used by the FASB, the Private Company Council (“PCC”), and the Emerging Issues Task Force (“EITF”) in specifying the scope of future financial accounting and reporting guidance. The Company does not expect this amendment to have any effect on the financial statements. | |||
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts (Topic 606). The new standard is effective for reporting periods beginning after December 15, 2016 and early adoption is not permitted. The comprehensive new standard will supersede existing revenue recognition guidance and require revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the Company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. The guidance permits two implementation approaches, one requiring retrospective application of the new standard with restatement of prior years and one requiring prospective application of the new standard with disclosure of results under old standards. The Company is currently evaluation the impacts of adoption and the implementation approach to be used. | |||
In August 2014, the FASB issued guidance that is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. In connection with preparing financial statements, management will need to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the organization’s ability to continue as a going concern within one year after the date that the financial statements are issued. The amendments will be effective for the Company for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company does not expect these amendments to have a material effect on its financial statements. | |||
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. | |||
Concentration | Concentrations | ||
Substantially all of the Company’s assets consist of real estate located in Richmond and Columbia Counties in the State of Georgia, and in North Augusta, South Carolina. In 2014 and 2013, approximately 99% and 93%, respectively, of the Company’s revenues were rental related revenue. In 2014 and 2013, approximately 50% and 49%, respectively, of the Company’s rental revenues were earned from National Plaza. Approximately 81% of National Plaza is leased to one tenant, a regional food supermarket. Approximately 45% and 46% of the Company’s rental revenues in 2014 and 2013, respectively, were earned from the Evans Ground Lease, which is 100% leased to a major national home improvement retailer. | |||
The majority of the Company’s receivables from tenants at September 30, 2014 and 2013 were receivable from two tenants, the regional food supermarket that leases property at National Plaza, and the major national home improvement retailer under the Evans Ground Lease. | |||
The Company places its cash with high quality financial institutions. At times the Company’s cash balances may be in excess of Federal Deposit Insurance Corporation limits. | |||
Subsequent events | Subsequent events | ||
Subsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued. Recognized subsequent events are events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements. Unrecognized subsequent events are events that provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date. | |||
In the first quarter of fiscal year 2015, the Company borrowed $15,000 from a member of the Company’s Board of Directors to meet short term cash flow needs. | |||
In the first quarter of fiscal year 2015, the Company received a signed letter of intent from Publix to exercise an option pursuant to original lease agreement and extend lease through June 2020. The Company also received a lease amendment from Edward D. Jones & Co. to exercise the option and extend their lease through January 2020. | |||
Management has reviewed events occurring through the date the financial statements were issued and no other subsequent events occurred that require accrual or disclosure. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES (Tables) | 12 Months Ended | ||
Sep. 30, 2014 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Schedule of estimated useful lives | Investment properties are stated at cost. Depreciation of the investment properties is computed principally using the straight-line method over the following estimated useful lives: | ||
Buildings for lease | 30 - 40 years | ||
Land improvements on property for lease | 15 years | ||
Fixtures and furnishings | 5 - 7 years | ||
INVESTMENT_PROPERTIES_Tables
INVESTMENT PROPERTIES (Tables) | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
INVESTMENT PROPERTIES | ||||||||
Schedule of Investment properties leased or held for lease | Investment properties leased or held for lease to others under operating leases consist of the following at September 30: | |||||||
2014 | 2013 | |||||||
National Plaza building, land and improvements | $ | 5,325,348 | $ | 5,138,796 | ||||
Evans Ground Lease, land and improvements | 2,382,673 | 2,382,673 | ||||||
Commercial land and improvements | 3,639,598 | 3,639,598 | ||||||
11,347,619 | 11,161,067 | |||||||
Less accumulated depreciation | (2,360,803 | ) | (2,221,077 | ) | ||||
8,986,816 | 8,939,990 | |||||||
Residential rental property | 145,847 | 145,847 | ||||||
Less accumulated depreciation | (33,505 | ) | (30,792 | ) | ||||
112,342 | 115,055 | |||||||
Investment properties for lease, net of depreciation | $ | 9,099,158 | $ | 9,055,045 | ||||
Schedule o future minimum rents receivable | Future minimum rents receivable under the operating lease agreements are as follows for the years ending September 30: | |||||||
2015 | $ | 997,337 | ||||||
2016 | 682,836 | |||||||
2017 | 702,523 | |||||||
2018 | 703,486 | |||||||
2019 | 657,796 | |||||||
Thereafter | 4,343,104 | |||||||
$ | 8,087,082 |
NOTES_PAYABLE_Tables
NOTES PAYABLE (Tables) | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Schedule of notes payable and line of credit | Notes payable consisted of the following at September 30: | |||||||
2014 | 2013 | |||||||
A construction loan to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The loan was procured to finance tenant improvements for the lease of in-line space at National Plaza executed on January 17, 2014. In April, 2014 construction of the tenant improvements was completed and with total principal borrowed of $186,804. The note converted to a note payable with monthly installments of $3,728 including interest over a 60 month term with fixed interest of 4.25%. The related lease agreement calls for monthly payments of this amount to be paid to the Company in addition to monthly minimum rental payments. | $ | 181,504 | $ | - | ||||
In November of 2012, the Company converted a previous line of credit to a fixed rate loan due December 2017. The new term loan accrues interest at a 5.5% annually with monthly installments of $3,287. The current balance relates to the purchase of the 1 acre adjoining the North Augusta, South Carolina property in May 2008 and is collateralized by the residential property on Stanley Drive in Augusta, Georgia. | 260,323 | 284,531 | ||||||
A note payable to an insurance company, secured with a mortgage interest in National Plaza and an assignment of rents. The note is payable in monthly installments of $35,633, including interest, through June 2015, and bears interest at a fixed rate of 7.875%. | 310,423 | 696,892 | ||||||
A note payable to a regional financial institution collateralized with 17.54 acres of land in North Augusta, South Carolina. The note is payable in monthly installments of $7,563, including principal and interest, through July 2018, and bears interest at a fixed rate of 5%. | 319,330 | 392,945 | ||||||
A note payable without collateral to a stockholder, who is also a member of the Flanagin Family, to meet the cash flow needs of the Company. The note matures in July of 2015 and accrues interest at 5%. | 50,433 | - | ||||||
A note payable to an insurance company collateralized with approximately 17 acres of land in Columbia County, Georgia, and an assignment of the long-term ground lease. The note is payable in monthly installments of $17,896, including interest, through May 1, 2027, and bears interest at a fixed rate of 5.85%. | 1,918,026 | 2,017,437 | ||||||
3,040,039 | 3,391,805 | |||||||
Less current maturities | (604,498 | ) | (584,491 | ) | ||||
$ | 2,435,541 | $ | 2,807,314 | |||||
Schedule of aggregate maturities of notes payable and the line of credit | Aggregate maturities of notes payable are as follows at September 30, 2014: | |||||||
2015 | $ | 604,498 | ||||||
2016 | 257,040 | |||||||
2017 | 271,144 | |||||||
2018 | 418,350 | |||||||
2019 | 167,730 | |||||||
Thereafter | 1,321,277 | |||||||
$ | 3,040,039 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ||||||||
Schedule of deferred income tax liabilities | The tax effects of temporary differences that give rise to the deferred tax liability are as follows as of September 30: | |||||||
2014 | 2013 | |||||||
Deferred income tax liabilities: | ||||||||
Basis in Investment Properties | $ | 737,230 | $ | 764,645 | ||||
Schedule of provision for income taxes | The provision for income taxes is as follows: | |||||||
For the years ended | ||||||||
September 30, | ||||||||
2014 | 2013 | |||||||
Current expense | $ | 233,689 | $ | 251,535 | ||||
Deferred benefit | (27,415 | ) | (7,202 | ) | ||||
$ | 206,274 | $ | 244,333 | |||||
Schedule of effective income tax rate reconciliation | The provision for income taxes for the years ended September 30, 2014 and 2013 differs from the amount obtained by applying the U.S. federal and state income tax rate to pretax income due to the following: | |||||||
2014 | 2013 | |||||||
Net income before tax | $ | 536,092 | $ | 626,618 | ||||
Expected federal tax expense at 34% | 182,271 | 213,050 | ||||||
State tax expense, net of federal benefit | 21,229 | 24,814 | ||||||
Permanent differences | - | 6,850 | ||||||
Other | 2,774 | (381 | ) | |||||
Tax expense | $ | 206,274 | $ | 244,333 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES (Details) | 12 Months Ended |
Sep. 30, 2014 | |
Land and Land Improvements [Member] | |
Estimated useful lives | |
Estimated useful lives | 15 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Estimated useful lives | |
Estimated useful lives | 5 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Estimated useful lives | |
Estimated useful lives | 7 years |
Building and Building Improvements [Member] | Maximum [Member] | |
Estimated useful lives | |
Estimated useful lives | 40 years |
Building and Building Improvements [Member] | Minimum [Member] | |
Estimated useful lives | |
Estimated useful lives | 30 years |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ACTIVITIES (Details Textual) (USD $) | 12 Months Ended | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2015 | |
Property | |||
Summary of Significant Accounting Policies and Activities (Textual) [Abstract] | |||
Number of investment properties | 2 | ||
Area of investment properties | 69,000 square feet | ||
Gross rent revenue, percentage | 99.00% | 93.00% | |
Total rents from lease | $463,200 | $463,200 | |
Gain on sale of land | 108,300 | ||
Reimbursed by tenants for property taxes and other maintenance fees | 271,964 | 267,289 | |
Allowance for uncollectible accounts | 43,578 | 19,938 | |
Lease commissions, accumulated amortization | 32,459 | 28,928 | |
Loan fees, accumulated amortization | 43,780 | 47,260 | |
Weighted average number of shares outstanding (in shares) | 5,243,107 | 5,243,107 | |
Proceeds from stockholder | 50,433 | 30,000 | |
Subsequent Event [Member] | |||
Summary of Significant Accounting Policies and Activities (Textual) [Abstract] | |||
Description of subsequent event | In the first quarter of fiscal year 2015, the Company received a signed letter of intent from Publix to exercise an option pursuant to original lease agreement and extend lease through June 2020. The Company also received a lease amendment from Edward D. Jones & Co. to exercise the option and extend their lease through January 2020. | ||
Director [Member] | Subsequent Event [Member] | |||
Summary of Significant Accounting Policies and Activities (Textual) [Abstract] | |||
Proceeds from stockholder | 15,000 | ||
Investment Properties Two [Member] | |||
Summary of Significant Accounting Policies and Activities (Textual) [Abstract] | |||
Gross rent revenue, percentage | 45.00% | 46.00% | |
Total rents from lease | 539,000 | 526,000 | |
Investment properties for lease | 44.00% | ||
Gain on sale of land | 108,300 | ||
Investment Properties One [Member] | |||
Summary of Significant Accounting Policies and Activities (Textual) [Abstract] | |||
Gross rent revenue, percentage | 50.00% | 49.00% | |
Total rents from lease | 463,200 | ||
Investment properties for lease | 53.00% | ||
National Home Improvement Retailer [Member] | Investment Properties Two [Member] | |||
Summary of Significant Accounting Policies and Activities (Textual) [Abstract] | |||
Gross rent revenue, percentage | 100.00% | ||
Regional Food Supermarket [Member] | Investment Properties One [Member] | |||
Summary of Significant Accounting Policies and Activities (Textual) [Abstract] | |||
Gross rent revenue, percentage | 81.00% | ||
Total rents from lease | $463,200 |
INVESTMENT_PROPERTIES_Details
INVESTMENT PROPERTIES (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
Real Estate Properties [Line Items] | ||
Investment property gross | $11,347,619 | $11,161,067 |
Less accumulated depreciation | -2,360,803 | -2,221,077 |
Investment property, net | 8,986,816 | 8,939,990 |
Residential rental property | 145,847 | 145,847 |
Less accumulated depreciation | -33,505 | -30,792 |
Residential rental property, net | 112,342 | 115,055 |
Total Investment Properties | 9,099,158 | 9,055,045 |
National Plaza building, land and improvements [Member] | ||
Real Estate Properties [Line Items] | ||
Investment property gross | 5,325,348 | 5,138,796 |
Evans Ground Lease, land and improvements [Member] | ||
Real Estate Properties [Line Items] | ||
Investment property gross | 2,382,673 | 2,382,673 |
Commercial land and improvements [Member] | ||
Real Estate Properties [Line Items] | ||
Investment property gross | $3,639,598 | $3,639,598 |
INVESTMENT_PROPERTIES_Details_
INVESTMENT PROPERTIES (Details 2) (USD $) | Sep. 30, 2014 |
Schedule of Future minimum rents receivable | |
2015 | $997,337 |
2016 | 682,836 |
2017 | 702,523 |
2018 | 703,486 |
2019 | 657,796 |
Thereafter | 4,343,104 |
Future minimum payments receivable | $8,087,082 |
INVESTMENT_PROPERTIES_Details_1
INVESTMENT PROPERTIES (Details Textual) (USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Investment Properties (Textual) [Abstract] | ||
Depreciation expense | $142,439 | $125,217 |
Gross rent revenue, percentage | 99.00% | 93.00% |
Minimum annual rental payments | 463,200 | 463,200 |
Deferred income | -22,582 | -24,652 |
Investment Properties One [Member] | ||
Investment Properties (Textual) [Abstract] | ||
Gross rent revenue, percentage | 50.00% | 49.00% |
Minimum annual rental payments | 463,200 | |
Renewal period description | Expires in 2015 and is renewable for a total of an additional twenty years at substantially similar lease terms. | |
Lease agreement, description | The lease agreement also provides for the Company to receive each year 1.25% of the individual supermarket’s gross sales in excess of approximately $37 million. For 2014 and 2013, the supermarket did not achieve this gross sales level. | |
Cost of construction, National Plaza | 493,000 | |
Deferred income | 24,652 | |
Deferred revenue, description | Revenue annually using the straight-line method over the twenty-year life of the lease with the supermarket. | |
Ground lease, description | The ground lease provides for minimum rent of $45,000 annually, for the first 10 years of the lease. The minimum rent increases by approximately 10% after year 10 and then again after year 15 of the ground lease. Other lease agreements at National Plaza range in terms from one to five years. | |
Investment Properties One [Member] | Regional Food Supermarket [Member] | ||
Investment Properties (Textual) [Abstract] | ||
Gross rent revenue, percentage | 81.00% | |
Minimum annual rental payments | $463,200 |
INVESTMENT_PROPERTIES_Details_2
INVESTMENT PROPERTIES (Details Textual 2) (USD $) | 1 Months Ended | ||
31-May-06 | Sep. 30, 2014 | Sep. 30, 2013 | |
acre | |||
Investment Properties (Textual) [Abstract] | |||
Land and improvements held for investment or development | $3,639,598 | $3,639,598 | |
North Augusta [Member] | |||
Investment Properties (Textual) [Abstract] | |||
Land and improvements held for investment or development, area | 19.38 | ||
South Richmond County [Member] | |||
Investment Properties (Textual) [Abstract] | |||
Land and improvements held for investment or development, area | 85 | ||
Washington Road In Augusta [Member] | |||
Investment Properties (Textual) [Abstract] | |||
Land and improvements held for investment or development, area | 1.1 | ||
Lease Agreements [Member] | |||
Investment Properties (Textual) [Abstract] | |||
Area of land sold of Evans Ground Lease in Columbia County, Georgia | 18 | ||
Monthly rental payments, development period | 20,833 | ||
Annual rental payments | $500,000 | ||
Annual rental payments description | First 5 years | ||
Percentage of rent increasing in years 6, 11, and 16 | 5.00% | ||
Renewal period | 21 years | ||
Renewal period description | Every 5 years thereafter | ||
Total lease term | 50 years |
NOTES_PAYABLE_Details_Textual
NOTES PAYABLE (Details Textual) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||
Jan. 17, 2014 | Nov. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Apr. 30, 2014 | 31-May-08 | |
acre | acre | acre | ||||
Debt Instrument [Line Items] | ||||||
Total notes payable | $3,040,039 | $3,391,805 | ||||
Current notes payable | -554,065 | -584,491 | ||||
Noncurrent notes payable | 2,435,541 | 2,807,314 | ||||
Construction Loan Payable [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Total notes payable | 181,504 | |||||
Land collateralized (in acres) | 17.54 | |||||
Total principal borrowed | 186,804 | |||||
New Term Loan Due December 2017 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Total notes payable | 260,323 | 284,531 | ||||
Interest rate (in percent) | 5.50% | |||||
Periodic monthly installments | 3,287 | |||||
Area purchased in adjoining the North Augusta, South Carolina property (in acres) | 1 | |||||
Note Payable to Insurance Company Collateralized with Land in Columbia County Georgia and Assignment of Long Term Ground Lease [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Total notes payable | 1,918,026 | 2,017,437 | ||||
Interest rate (in percent) | 5.85% | |||||
Periodic monthly installments | 17,896 | |||||
Land collateralized (in acres) | 17 | |||||
Note Payable Issuable Upon Conversion of Construction Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate (in percent) | 4.25% | |||||
Periodic monthly installments | 3,728 | |||||
Term of debt | 60 months | |||||
Note Payable to Regional Financial Institution Collateralized with Land in North Augusta South Carolina [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Total notes payable | 319,330 | 392,945 | ||||
Interest rate (in percent) | 5.00% | |||||
Periodic monthly installments | 7,563 | |||||
Land collateralized (in acres) | 17.54 | |||||
Note Payable to Insurance Company Secured with Mortgage Interest in National Plaza and Assignment of Rents [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Total notes payable | 310,423 | 696,892 | ||||
Interest rate (in percent) | 7.88% | |||||
Periodic monthly installments | 35,633 | |||||
Note Payable to Stockholder to Meet Cash Flow Needs of Entity [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Total notes payable | $50,433 | |||||
Interest rate (in percent) | 5.00% |
NOTES_PAYABLE_Details_2
NOTES PAYABLE (Details 2) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
Schedule of aggregate maturities of notes payable and the line of credit refinanced | ||
2015 | $604,498 | |
2016 | 257,040 | |
2017 | 271,144 | |
2018 | 418,350 | |
2019 | 167,730 | |
Thereafter | 1,321,277 | |
Long-term debt | $3,040,039 | $3,391,805 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
Deferred income tax liabilities: | ||
Basis in Investment Properties | $737,230 | $764,645 |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Provision for income taxes | ||
Current expense | $233,689 | $251,535 |
Deferred benefit | -27,415 | -7,202 |
Total income taxes provision (Benefit) | $206,274 | $244,333 |
INCOME_TAXES_Details_3
INCOME TAXES (Details 3) (USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Effective income tax rate reconciliation | ||
Net income before tax | $536,092 | $626,618 |
Expected federal tax expense at 34% | 182,271 | 213,050 |
State tax expense, net of federal benefit | 21,229 | 24,814 |
Permanent differences | 6,850 | |
Other | 2,774 | -381 |
Tax expense | $206,274 | $244,333 |
INCOME_TAXES_Details_Textual
INCOME TAXES (Details Textual) (USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Income Tax (Textual) [Abstract] | ||
Deferred gains for tax | $973,000 | |
Total outstanding income tax payable | $229,031 | $183,236 |
Federal statutory income tax rate, percent | 34.00% |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details Textual) (USD $) | 12 Months Ended | 3 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||
Total fess | $19,502 | $6,596 | |
Proceeds from stockholder | 50,433 | 30,000 | |
Interest rate for repayments | 5.00% | ||
Professional fees, accounting services to son of President | 4,250 | ||
Director [Member] | |||
Related Party Transaction [Line Items] | |||
Accrued professional fees and other expenses | 150,000 | ||
Director [Member] | Subsequent Event [Member] | |||
Related Party Transaction [Line Items] | |||
Proceeds from stockholder | $15,000 |