FLANIGANS ENTERPRISES INC 10-K

ITEM 2. PROPERTIES . Our operations are conducted primarily on leased property with the exception of the following: (i) a 10,000 square foot stand-alone building located in Fort Lauderdale, Florida that we purchased in December 1999, which since April 2001 has housed our corporate headquarters; (ii) a 4,600 square foot stand-alone building located in Hallandale, Florida that we purchased in July 2006 and which since September 1968 has housed our Hallandale, Florida Company-owned combination restaurant and package liquor store (Store #31); (iii) a 4,120 square foot stand-alone building in Hollywood, Florida we constructed in November 2003, upon real property we acquired in September 2001 pursuant to a 25 year ground lease interest, (a portion of this building is leased to an unaffiliated third party), and which since November 2003 has housed our Hollywood, Florida Company-owned package liquor store (Store #4); (iv) a 4,500 square foot stand-alone building located in Hollywood, Florida that we purchased in October 2009 and which housed our Hollywood, Florida Company-owned combination restaurant and package liquor store (Store #19) from March, 1972 until it was destroyed by fire on October 2, 2018 and the vacant parcel of real property adjacent thereto which we purchased in February 2015. Subsequent to the fire, (i) we constructed a 3,000 square foot stand-alone building on the vacant parcel of real property for the operation of our Company-owned package liquor store (Store #19P), which opened for business during the first quarter of our fiscal year 2024; and (ii) we constructed a 4,500 square foot stand-alone building here for the operation of the Company-owned restaurant, (Store #19R), which opened for business during the second quarter of our fiscal year 2024; (v) a 4,600 square foot stand-alone building located in Fort Lauderdale, Florida that we purchased in August 2010 and which since December 1968 has housed our Fort Lauderdale, Florida Company-owned restaurant (Store #22); (vi) a 5,100 square foot stand-alone building in North Miami, Florida that we purchased in November 2010; the two parcels of real property adjacent thereto which we purchased in December 2012, one of which is contiguous to the real property and which we previously leased for non-exclusive parking and the vacant parcel of real property adjacent to the two parcels of real property which we purchased in March 2017. The stand-alone building housed our North Miami, Florida Company-owned combination restaurant and package liquor store, (Store #20), from July 1968 until June 2017 when the package liquor store was re-located to a new building we constructed on the adjacent property; (vii) a 23,678 square foot two building shopping center in Miami, Florida that we purchased in November 2010: (A) one stand-alone building, approximately 18,828 square feet, (i) houses our package liquor store #45 and (ii) is otherwise leased to ten unaffiliated third party retailers; and (B) the second stand-alone building, approximately 4,850 square feet, has housed our limited partnership owned Kendall, Florida based restaurant since April 4, 2000, (Store #70); (viii) a 6,400 square foot building in Fort Lauderdale, Florida that we purchased in February 2014, 4,000 square feet of which has been leased to a related franchisee (Store #15) since April 1, 1997 and the balance (2,400 square feet) of which we use as storage. In August 2018 we purchased the real property and quadraplex adjacent thereto to insure adequate parking for the franchised restaurant in the future, if needed; (ix) a 6,000 square foot stand-alone building in Fort Lauderdale, Florida and the vacant real property diagonally adjacent that we purchased in October 2015, which we use as office and warehouse space, covered parking for our food truck and as a storage yard; (x) a 6,900 square foot stand-alone building in Sunrise, Florida, which we purchased in March 2021 and houses our limited partnership owned Sunrise, Florida based restaurant, (Store #85), which opened for business in March 2022; 22 (xi) a 6,000 square foot commercial space in Miami, Florida, which we purchased in April 2023 and in which we operate our package liquor store and warehouse (Store #47), through a sublease agreement from a sale-leaseback arrangement in January 1974; (xii) a 5,450 square foot three building shopping center in Hallandale Beach, Florida (adjacent to our combination package store and restaurant in Hallandale Beach, Florida (Store #31)), that we purchased in April 2023: (A) one stand-alone building, approximately 1,450 square feet, of which 950 square feet is leased to one unaffiliated third party retailer and 500 square feet which is occupied by us; (B) the second stand-alone building, approximately 1,500 square feet, which is leased to one unaffiliated third party retailer and (C) the third stand-alone building, approximately 2,500 square feet, which is leased to one unaffiliated third party retailer, (collectively Store #38); and (xiii) we are developing a 6,400 square foot stand-alone building in Cutler Bay, Florida, which vacant property we purchased in May 2025 and will house our limited partnership owned Cutler Bay, Florida based restaurant, (Store #3), which we anticipate will open for business during our fiscal year 2027. All of our units require periodic refurbishing in order to remain competitive. We have budgeted $750,000 for our refurbishing program for fiscal year 2026, although capital expenditures of our refurbishing program for our fiscal year 2026 may be significantly higher. See Item 7, “Liquidity and Capital Resources” for discussion of the amounts spent in fiscal year 2025. The following table summarizes information related to the properties upon which our operations are conducted and/or will be conducted. For all locations that include lease options, the lessor must extend the term of the lease for a location if we exercise the lease option. If there is no lease option or if we do not exercise the same, the lessor is not required to extend the term of the lease upon expiration. Name and Location Approx. Square Footage Seats Franchised/ Owned by Lease Terms Big Daddy’s Liquors #4 Flanigan’s Enterprises Inc. (5) 7003 Taft Street Hollywood, Florida 1,978 N/A Company 3/1/02 to 2/28/27 Options to 2/28/47 Big Daddy’s Liquors #7 Flanigan’s Enterprises, Inc. 1550 W. 84th Street Hialeah, Florida 1,450 N/A Company 11/1/00 to 10/31/2030 Options to 10/31/2035 Big Daddy’s Liquors #8 Flanigan’s Enterprises, Inc. 959 State Road 84 Fort Lauderdale, Florida 4,084 N/A Company 5/1/99 to 4/30/29 Flanigan’s Seafood Bar and Grill #9 Flanigan’s Enterprises, Inc. 1550 W. 84th Street Hialeah, Florida 4,700 130 Company 1/1/10 to 12/31/29 Options to 12/31/49 Flanigan’s Legends Seafood Bar and Grill #11 11 Corporation, Inc. (1) 330 Southern Blvd. W. Palm Beach, Florida 5,000 150 Franchise 1/4/00 to 1/3/30 Flanigan’s Seafood Bar and Grill #12 Flanigan’s Enterprises, Inc. 2405 Tenth Ave. North Lake Worth, Florida 5,000 180 Company 11/16/92 to 11/15/28 Options to 11/15/38 Flanigan’s Seafood Bar and Grill #14 Big Daddy’s #14, Inc. (1) (4) 2041 NE Second St. Deerfield Beach, Florida 3,320 90 Franchise 6/1/79 to 6/1/29 Options to 6/1/34 23 Name and Location Approx. Square Footage Seats Franchised/ Owned by Lease Terms Flanigan’s Seafood Bar and Grill #15 CIC Investors #15 Ltd. (1) (7) 1479 E. Commercial Blvd. Ft. Lauderdale, Florida 4,000 90 Franchise/ Limited Partnership 1/1/09 to 8/31/26 Options to 8/31/36 Flanigan’s Seafood Bar and Grill #18 Twenty Seven Birds Corp. (1) (2) 2721 Bird Avenue Miami, Florida 4,500 200 Franchise 2/15/72 to 12/31/25 Options to 12/31/35 Big Daddy’s Liquors #18 Twenty Seven Birds Corp. (1) (2) 2988 S.W. 27 th Avenue Miami, Florida 3,000 N/A Franchise 2/15/72 to 12/31/25 Options to 12/31/35 Flanigan’s Wine & Liquors #19 (8) Flanigan’s Enterprises, Inc. 2505 N. University Dr., Building A Hollywood, Florida 3,000 N/A Company Company-Owned Flanigan’s Seafood Bar and Grill #19 (8) Flanigan’s Enterprises, Inc. 2505 N. University Dr., Building B Hollywood, Florida 4,500 160 Company Company-Owned Flanigan’s Seafood Bar and Grill #20 Flanigan’s Enterprises, Inc. 13205 Biscayne Blvd. North Miami, Florida 5,100 150 Company Company-Owned Big Daddy’s Liquors #20 Flanigan’s Enterprises, Inc. 13185 Biscayne Blvd. North Miami, Florida 2,500 N/A Company Company-Owned Flanigan’s Seafood Bar and Grill #22 Flanigan’s Enterprises, Inc. 2600 W. Davie Blvd. Ft. Lauderdale, Florida 4,100 200 Company Company-Owned Big Daddy’s Wine & Liquors #24 Flanigan’s Enterprises, Inc. (10) 11225 Miramar Parkway, #245 Miramar, Florida 2,000 N/A Company 3/5/22 to 3/5/32 Options to 3/5/47 24 Name and Location Approx. Square Footage Seats Franchised/ Owned by Lease Terms Brendan’s Sports Pub 3,500 85 Company 6/16/22 to 6/30/72 Flanigan’s Enterprises, Inc. 868 S. Federal Highway Pompano Beach, Florida Flanigan’s Seafood Bar and Grill #31 Flanigan’s Enterprises, Inc. 4 N. Federal Highway Hallandale, Florida 4,600 150 Company Company-Owned Flanigan’s Seafood Bar and Grill #33 Flanigan’s Enterprises, Inc. 45 S. Federal Highway Boca Raton, Florida 4,620 130 Company 10/1/10 to 6/30/30 Big Daddy’s Liquors #34 Flanigan’s Enterprises, Inc. 9494 Harding Ave. Surfside, Florida 3,000 N/A Company 5/29/97 to 5/28/27 Options to 5/28/37 Flanigan’s Seafood Bar and Grill #40 Flanigan’s Enterprises, Inc. 5450 N. State Road 7 N. Lauderdale, Florida 4,600 140 Company Company-Owned Piranha Pat’s #43 BD 43 Corporation (1) (2) 2500 E. Atlantic Blvd. Pompano Beach, Florida 4,500 90 Franchise 12/1/72 to 11/30/27 Big Daddy’s Liquors #45 Flanigan’s Enterprises, Inc. 12776 S.W. 88th Street Miami, Florida 3,250 N/A Company 7/1/19 to 6/30/29 Options to 6/30/34 Big Daddy’s Liquors #47 Flanigan’s Enterprises, Inc. (3) 8600 Biscayne Blvd. Miami, Florida 6,000 N/A Company 12/21/68 to 1/1/30 Options to 1/1/50 (Sublease) Company-Owned Flanigan’s Seafood Bar and Grill #13 CIC Investors #13, Ltd. 11415 S. Dixie Highway Pinecrest, Florida 8,000 200 Limited Partnership 6/01/91 to 1/31/31 Options to 1/31/36 25 Name and Location Approx. Square Footage Seats Franchised/ Owned by Lease Terms Flanigan’s #25 CIC Investors #25, Ltd. (9) 11225 Miramar Parkway, #250 Miramar, Florida 6,000 200 Limited Partnership 3/5/22 to 3/5/32 Options to 3/5/47 Flanigan’s Seafood Bar and Grill #50 CIC Investors #50, Ltd. 17185 Pines Boulevard Pembroke Pines, Florida 4,000 200 Limited Partnership 10/24/06 to 10/23/26 Options to 10/23/31 Flanigan’s Seafood Bar and Grill #55 CIC Investors #55, Ltd. 2190 S. University Drive Davie, Florida 5,900 200 Limited Partnership 1/5/07 to 12/31/26 Options to 12/31/31 Flanigan’s Seafood Bar and Grill #60 CIC Investors #60 Ltd. 9516 Harding Avenue Surfside, Florida 6,800 200 Limited Partnership 8/1/97 to 12/31/26 Flanigan’s Seafood Bar and Grill #65 CIC Investors #65, Ltd. 2335 State Road 7, Suite 100 Wellington, Florida 6,128 200 Limited Partnership 5/01/05 to 6/30/35 Options to 6/30/40 Flanigan’s Seafood Bar and Grill #70 CIC Investors #70 Ltd. 12790 SW 88 St. Miami, Florida 4,850 200 Limited Partnership 4/1/00 to 3/31/30 Options to 3/31/35 Flanigan’s Seafood Bar and Grill #75 Flanigan’s Enterprises, Inc. 950 S. Federal Highway Stuart, Florida 7,000 200 Company 5/1/10 to 4/30/26 Options to 4/30/31 Flanigan’s Seafood Bar and Grill #80 CIC Investors #80 Ltd. 8695 N.W. 12 th St Miami, Florida 5,000 165 Limited Partnership 6/15/01 to 12/14/29 Options to 12/14/39 Flanigan’s Seafood Bar and Grill #85 CIC Investors #85 Ltd. 14301 W. Sunrise Blvd. Sunrise, Florida 6,900 200 Limited Partnership 3/1/19 to 2/28/29 Options to 2/28/44 Company-Owned 26 Name and Location Approx. Square Footage Seats Franchised/ Owned by Lease Terms Flanigan’s Seafood Bar and Grill #90 CIC Investors #90 Ltd. 9857 S.W. 40 th Street Miami, Florida 6,400 200 Limited Partnership 4/1/11 to 3/31/31 Options to 3/31/36 Flanigan’s Seafood Bar and Grill #95 Flanigan’s Enterprises, Inc. 2460 Weston Road Weston, Florida 5,700 235 Company 10/1/17 to 9/30/27 Options to 9/30/32 Flanigan’s Calusa Center, LLC (6) 12750 – 12790 S.W. 88 th Street Miami, Florida 23,700 N/A Company Company-owned shopping center Flanigan’s Enterprises, Inc. (11) 615 – 715 E. Hallandale Beach Blvd. Hallandale Beach, Florida 5,450 N/A Company Company-owned shopping center Flanigan’s Enterprises, Inc. (12) 5055 NE 13 th Avenue Oakland Park, FL 33334 3,600 N/A Company 7/1/2025-6/30/2027 Flanigan’s #3 (13) 6,400 240 Limited Partnership TBD Company-Owned (1) Franchised by Company. (2) Lease assigned to franchisee. We are no longer contingently liable on the lease. (3) In 1974, we sold and assigned the underlying ground lease to unaffiliated third parties and simultaneously subleased it back. We have re-purchased from the unaffiliated third parties and currently own 56% of the underlying ground lease, as well as the sublease agreement. In April 2023 we purchased the real property, subject to the ground lease and sublease agreement through which we continue to occupy the premises. As a result, we pay 44% of the rent due under the ground lease and the sublease agreement. (4) Effective December 1, 1998, we purchased the Management Agreement to operate the franchised restaurant for the franchisee. (5) Ground lease executed by us on September 25, 2001. We constructed a 4,120 square foot building, of which 1,978 square feet is used by us for the operation of a package liquor store and the other 2,142 square feet is subleased to an unaffiliated third party as retail space. The package liquor store opened for business on November 17, 2003. (6) During the first quarter of our fiscal year 2012, our wholly owned subsidiary, Flanigan’s Calusa Center, LLC, closed on the purchase of a two building shopping center in Miami, Florida, which consists of (i) one stand-alone building which is leased to ten unaffiliated third parties and houses our package liquor store #45 (approximately 3,250 square feet) and (ii) a second stand-alone building where our limited partnership owned restaurant located at 12790 SW 88 th Street, Miami, Florida, (Store #70), operates. (7) During the second quarter of our fiscal year 2014, we closed on the purchase of the building in Fort Lauderdale, Florida, which is leased to our franchisee owned restaurant located at 1479 E. Commercial Boulevard, Fort Lauderdale, Florida, (Store #15). (8) During the first quarter of our fiscal year 2019, our combination package liquor store and restaurant located at 2505 N. University Drive, Hollywood, Florida (Store #19), was damaged by a fire and was forced to close. We determined that Store #19 should be demolished and rebuilt as separate buildings. As a result, the package liquor store was closed since our first quarter year 2019, but re-opened for business in the first quarter of fiscal 2023 in a newly constructed stand-alone building #19P. During the second quarter of our fiscal year 2024, we re-opened our restaurant in a stand-alone building on the same site in Hollywood, Florida adjacent to Store #19P. 27 (9) During the fourth quarter of our fiscal year 2019, we entered into a lease for this location, which lease was subsequently assigned to a limited partnership. We raised funds to renovate this new location for operation as a “Flanigan’s” restaurant using our limited partnership ownership model, which location opened for business in April 2023. (10) During the fourth quarter of our fiscal year 2019, we entered into a lease for this location. This new location opened for business as a “Big Daddy’s Wine & Liquors” retail package liquor store in March 2023. (11) During the third quarter of our fiscal year 2023, we closed on the purchase of a three building shopping center in Hallandale Beach, Florida adjacent to our combination package store and restaurant in Hallandale Beach, Florida (Store #31), which consists of: (A) one stand-alone building which is leased to two unaffiliated third party retailers; (B) the second stand-alone building which is leased to one unaffiliated third party retailer; and (C) the third stand-alone building which is leased to one unaffiliated third party retailer. (12) During the second quarter of our fiscal year 2025, we entered into a two-year lease for this storage unit. Previously this storage unit had been a one year lease. (13) During the third quarter of our fiscal year 2025, we purchased vacant real property located in Cutler Bay, Florida. We plan to construct a 6,400 square foot building to lease to a limited partnership to be formed of which we will be the sole general partner to construct and operate a “Flanigan’s” restaurant. Re-construction Following Casualty Loss During the first quarter of our fiscal year 2019, our combination package liquor store and restaurant located at 2505 N. University Drive, Hollywood, Florida (Store #19) was damaged by a fire and was forced to close. The package liquor store re-opened for business during the first quarter of our fiscal year 2023 in a newly constructed stand-alone building. The restaurant re-opened for business during the second quarter of our fiscal year 2024 in a newly constructed stand-alone building where our combination package liquor store and restaurant was previously located. Purchase of Real Property; Leasehold / Sub-leasehold Interests Purchase of Real Property During the third quarter of our fiscal year 2025, we purchased the vacant real property located at 20971 Old Cutler Road, Cutler Bay, Florida 33189 (the “Cutler Bay Property”) for a purchase price of $2,200,000. We paid all cash at closing. We plan to construct a 6,400 square foot building on the Cutler Bay Property to lease to a limited partnership of which we will be the sole general partner pursuant to our limited partnership financial arrangement to develop and operate a “Flanigan’s” restaurant. Purchase of Leasehold/Sub-leasehold Interests In 1974, we sold the underlying ground lease to the real property located at 8600 Biscayne Boulevard, El Portal, Florida to related and unrelated third parties and simultaneously subleased it back. We operate our retail package liquor store (Store #47) and warehouse from this location. During the first quarter of our fiscal year 2024, we re-purchased a 4% interest in the underlying ground lease, as well as the sublease agreement from an unrelated third party for $31,000 and currently own 56% of each lease. As a result, we now only pay 44% of the rent due under the ground lease and the sublease agreement. Subsequent Events Subsequent to the end of our fiscal year 2025, we re-financed with our institutional lender, our mortgage loan encumbering the real property and improvements located at 12750 – 12790 S.W. 88 th Street, Miami, Florida where our Flanigan’s Calusa Center and our limited partnership owned Flanigan’s Seafood Bar and Grill restaurant operate (Store #70), without increasing the principal amount borrowed at this time ($5,676,856). The re-financed mortgage loan earns interest at a fluctuating rate per year equal to the sum of (i) the greater of the Term SOFR Daily Floating Rate or the Index Floor (which for purposes hereof is 0.00%) and (ii) 2.25%, with the first payment of principal and interest due January 31, 2026 and monthly thereafter on the last day of each month until November 30, 2030 when the entire principal payment and all accrued interest is due in full. We received no excess funds from the re-financing of this mortgage loan.