J.W. Mays, Inc. — Form 10-K Summary
Business Context and Reporting Period
J.W. Mays, Inc. operates commercial real estate properties, primarily in New York and Ohio. The filing covers the fiscal year ended July 31, 2023. The company had 30 employees, and approximately 27% were covered by a union agreement expiring November 30, 2025.
The consolidated financial statements and management’s discussion are incorporated by reference from the 2023 Annual Report to Shareholders; the supplied filing text does not provide the consolidated income statement, balance sheet, or cash flow amounts.
Key Financial and Operating Metrics
- The company operated approximately 1.45 million square feet across seven principal properties.
- Reported property occupancy rates for the year ended July 31, 2023 included 59.51% at Brooklyn Fulton Street, 83.46% at the Jowein Building, 80.58% at Jamaica, 22.27% at Fishkill, 100% at Levittown, 100% at Massapequa, and 99.30% at Circleville.
- Annual rent shown in the property schedules totaled approximately $7.1 million for Brooklyn Fulton Street, $5.1 million for the Jowein Building, $5.7 million for Jamaica, $434,036 for Levittown, $847,362 for Massapequa, and $881,938 for Circleville. Fishkill’s schedule did not show annual rent for 2023.
- Fishkill had approximately 156,000 square feet available for lease, representing a significant vacancy exposure.
- Owned properties were subject to mortgages, but the filing text supplied does not provide mortgage balances, interest rates, maturities, or total debt.
- The filing text does not provide clear values for consolidated revenue, net income, operating income, cash flow, margins, cash and equivalents, liquidity, assets, liabilities, or per-share results.
- Common shares outstanding were 2,015,780 as of September 5, 2023. No share repurchases occurred during the fourth quarter of fiscal 2023.
- Auditor fees were $227,500 in fiscal 2023, including $170,000 of audit fees, $12,500 of audit-related fees, and $45,000 of tax fees.
Material Changes Versus the Prior Comparable Period
- Brooklyn occupancy declined to 59.51% from 63.38% in 2022, primarily reflecting lease terminations and expirations. A 46,421-square-foot office lease terminated effective March 31, 2023.
- Jowein occupancy increased to 83.46% from 80.84%, while Jamaica occupancy was broadly stable at 80.58% versus 80.51%.
- Fishkill occupancy remained low at 22.27%; a six-month, 58,832-square-foot storage lease expired in February 2023.
- Massapequa occupancy improved to 100% from 93.75% in 2021 and remained at 100% in 2022 and 2023.
- The company exercised an option extending the Jamaica property lease to May 31, 2035.
- Several tenants extended leases, including a 28,634-square-foot Jamaica retail tenant through February 2034 and Circleville tenants through October 2024 and May 2026.
- Executive employment agreements were renewed effective August 1, 2023 through July 31, 2026. The CFO resigned effective December 31, 2023, after the fiscal year-end.
Outlook, Commentary, Risks, and Unusual Items
- Management intends to negotiate lease renewals as they mature, subject to tenant financial condition, and to market vacant space to governmental, medical, educational, and other tenants.
- Management identified continuing risks from economic downturns, tenant financial weakness, reduced office demand from remote work, online retail competition, rising property fit-out costs, financing availability, interest-rate volatility, insurance costs, regulation, climate change, cybersecurity, terrorism, and pandemics.
- Older properties may contain hazardous materials requiring remediation or encapsulation when spaces are renovated.
- The company has related-party exposure because Jamaica is leased from an affiliated company principally owned by a company director. The controlling shareholder group may also have interests that differ from those of minority shareholders.
- Various lawsuits and claims were pending, but management believed they would not materially adversely affect the consolidated financial statements.
- If the company sells, transfers, disposes of, or demolishes 25 Elm Place, it may be required to create a condominium unit for a loading dock; the requirement and cost were not determinable.
- No specific earnings, revenue, occupancy, capital-spending, or financing guidance was provided in the supplied filing text.
Investor Verification Checklist
- Review the incorporated 2023 Annual Report for consolidated revenue, net income, cash flow, debt, liquidity, property income, expenses, and year-over-year changes.
- Verify mortgage balances, maturities, interest rates, covenants, and refinancing requirements.
- Assess the effect of Brooklyn’s low occupancy and Fishkill’s substantial vacant space on rental income and cash flow.
- Review tenant concentration, lease expirations, renewal assumptions, and exposure to financially weaker tenants.
- Examine related-party lease terms for the Jamaica property and governance safeguards involving the controlling shareholder group.
- Confirm the post-year-end CFO transition and its potential effect on financial reporting and management continuity.
- Review pending litigation and the potential condominium-unit obligation at 25 Elm Place.