Climate Change Data

Environmental Metrics

Social Achievements

• Launched a retention bonus plan to reward and incent performance, align interests of directors, executives, and employees with shareholders, and retain personnel during the company's strategic plan to enhance property values, liquidate, and dissolve.

Governance Achievements

• Established an Audit Committee consisting of Messrs. Smith, Levine, and Macklin, all members being “financially literate” and “independent,” with Mr. Levine qualifying as an “audit committee financial expert.”
• Adopted a written Code of Ethics applicable to all directors, officers, and employees.

Climate Goals & Targets

Environmental Challenges

• Illiquidity of real estate assets and lack of diversification.
• Potential for land entitlement and liquidation costs or unpaid liabilities to exceed expectations.
• Stipulation of Settlement limiting property sales to prices above December 2014 appraised values.
• Risks incidental to real estate ownership and management (tenant non-performance, costly leasehold improvements, lease terminations, etc.).
• Risks associated with property value enhancement efforts (permit delays, inaccurate analysis, cost overruns, financing difficulties, etc.).
• Uncertainty regarding the exact timing and amount of further distributions to shareholders.
• Potential for unknown liabilities related to properties.
• Inability to maintain occupancy rates or lease available space.
• Risks associated with tenant financial condition and potential defaults.
• Potential for increased operating costs.
• Potential for losses not covered by insurance.
• Thinly traded common shares and potential delisting from Nasdaq.
• History of operating losses and anticipation of future losses.
• Potential negative impact on medical office park value due to healthcare industry factors.
• Capital-intensive investment in medical parks.
• Limited ability to fund capital expenditures.
• Risks stemming from New York State budgets and their impact on Stony Brook University.
• Geographic concentration of properties making the business vulnerable to economic downturns in the New York metropolitan area.
• Risks associated with renovations and capital improvements.
• Cybersecurity risks and cyber incidents.
• Mortgage indebtedness and potential for foreclosure.
• Potential adverse effects from changes in federal tax law.

Mitigation Strategies

• Opportunistic disposition of properties to maximize shareholder distributions.
• Careful management of net assets through cash flow management, occupancy maintenance, and property value enhancement.
• Annual review of capital needs and prudent distribution decisions.
• Maintenance of reasonably adequate reserves to satisfy known and foreseeable liabilities.
• Pre-development enhancements to properties to increase sale prices.
• Consideration of offers from potential buyers even before completing the entitlement process.
• Disciplined approach to managing operations, including tenant incentives.
• Implementation of programs to motivate, reward, and retain key management personnel.
• Securing credit facilities for tenant improvements and working capital.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Illiquidity of real estate and lack of diversification may make it difficult for us to sell properties or achieve satisfactory returns in one or more properties within projected timelines.
• If our land entitlement and liquidation costs or unpaid liabilities are greater than we expect, our liquidating distributions to our shareholders may be delayed or reduced.
• Community opposition could adversely impact our efforts to obtain entitlements and enhance the value of our properties.
• If we are unable to find buyers for our properties at our expected sales prices, distributions may be delayed or reduced.
• Distributions to shareholders may be delayed or reduced as a result of sale agreement provisions that allow purchasers to terminate agreements and/or result in purchaser defaults.
• Our shareholders may be liable to our creditors for an amount up to the amount distributed by us if our reserves for payments to creditors are inadequate.
• Our properties may subject us to known and unknown liabilities.
• If we are unable to maintain the occupancy rates of currently leased space and/or to lease currently available space, if tenants default under their leases or other obligations to us or if our cash flow is otherwise less than we expect, distributions to our shareholders may be delayed or reduced.
• The loss of a major tenant could adversely affect our financial condition.
• We may experience increased operating costs, which might reduce our estimated net assets in liquidation and the sales prices received for our properties.
• Some of our potential losses may not be covered by insurance.
• We may incur costs to comply with environmental laws.
• Our business, operations and timelines for pursuing entitlements, property sales and distributions of proceeds could be adversely affected by the Coronavirus pandemic.
• Increases in interest rates could increase the amount of our debt payments and adversely affect our ability to pay distributions to our shareholders.
• Changes in federal tax law could adversely affect the tax treatment of distributions to our shareholders.
• Loss of key management personnel.

Mitigation Strategies

• We actively manage the renewal process. Historically, this has resulted in a very low turnover rate with our tenants.
• The Company believes it is currently capitalized with adequate cash levels and adequate access to its credit facilities to operate our business and complete our strategic plan of positioning our remaining properties for sale at enhanced values and making liquidating distributions to our shareholders.
• The Company focuses its available capital to operate the Company and pursue the entitlements strategy.
• To secure access to additional working capital, if needed, through the final sale date of the Flowerfield industrial buildings, the Company secured a second loan evidenced by a secured non-revolving business line of credit agreement and promissory note with a bank for up to $3,000,000, which closed on January 24, 2019.
• To secure access to additional working capital through the final sale date of the Cortlandt Property lots (“Lots”), the Company, through its subsidiary GSD Cortlandt, LLC (“GSD Cortlandt”) signed a commitment letter for a third loan evidenced by a non-revolving business line of credit agreement and promissory note with the Original Line bank for up to $2,500,000, which is scheduled to close in the second quarter of 2020.
• Effective February 27, 2020, the Company entered into an engagement letter with a national real estate finance firm (the “Firm”) pursuant to which the Firm agreed to assist the Company secure financing with prospective lenders, and the Company agreed to pay the Firm an origination fee equal to one percent (1%) of any loan secured by the Company with any lender introduced to the Company by the Firm other than designated excluded lenders with whom the Company has a preexisting relationship.
• We are actively working with our tenants to manage and mitigate the impact to COVID-19 on the Company’s operations, liquidity and resulting Net Asset Value.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Market decline in real estate value in Flowerfield due to the impact of the pandemic.
• COVID-19 pandemic impacting tenants' ability to meet lease obligations.
• Potential delays in securing entitlements and property sales due to COVID-19 crisis management by state and local governments.
• Adverse impact on the real estate market due to COVID-19.

Mitigation Strategies

• Actively working with tenants to manage and mitigate the impact of COVID-19.
• Implemented a work from home policy for employees.
• Secured a loan for up to $2,500,000 to enhance liquidity.
• Took proactive measures to manage costs, including deferring land development fees.

Supply Chain Management

Climate-Related Risks & Opportunities