What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2024-03-26 compared with 2023-03-23 · 972 added, 929 removed, 1823 unchanged (51% of the section changed)

13 unchanged sentences

and with the participation of our management, including our principal executive officer, principal financial officer and principal accounting

officer, we conducted an evaluation of the effectiveness of our internal control over

financial reporting based on the framework in the

officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in the

Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on our evaluation under the framework in the Internal Control-Integrated Framework (2013) , our management concluded that

our internal control over financial reporting was effective as of December 31, 2022.

Based on our evaluation

under the framework in the Internal Control-Integrated

Framework (2013) , our management concluded that our internal control over financial reporting was effective as of December 31, 2023.

This Annual Report does not include an attestation

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The rest of the information required in response to

this Item 10 is included under the captions “Board of Directors & Corporate Governance”, “Our Executive Officers”,

“Securities Ownership” in the Company's Proxy Statement, and such information is incorporated herein by reference.

Statement will be filed with the Securities and Exchange Commission not later than March 31, 2023.

this Item 10 is included under the captions “Our Board of Directors”, “Corporate Governance, ESG and Our Approach to

Risk Management”, “Our Executive Officers”, “Securities Ownership” in the Company's Proxy Statement, and

such information is incorporated herein by reference.

The Proxy Statement will be filed with the Securities and Exchange Commission not

later than March 31, 2024.

EXECUTIVE COMPENSATION.

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period by dividing the pre-determined value of each award by the closing price of our common stock on the date the restricted stock is

The aggregate value of the

performance share awards shown in

table is $325,920.

For illustrative purposes, the maximum payout of the performance share awards has been assumed, and the number of performance

share awards has been calculated using our closing stock price on March 2, 2023 ($54.32).

The performance share awards are subject to

partial or complete forfeiture if the vesting criteria are not met.

Because some or all of the performance share awards may not vest,

and because the number of shares of restricted stock to be issued thereunder is dependent on future stock prices, columns (a) and (c)

may overstate or understate expected dilution.

The aggregate value of the performance share awards shown in table is $405,356.

For illustrative purposes, the maximum

payout of the performance share awards

has been assumed, and the number of performance share awards has been calculated using our closing stock price on March 6, 2024 ($60.51).

The performance share awards are subject to partial or complete forfeiture if the vesting criteria are not met.

Because some or all of

the performance share awards may not vest, and because the number of shares of restricted stock to be issued thereunder is dependent on

future stock prices, columns (a) and (c) may overstate or understate expected dilution.

Because there is no exercise price associated with the performance share awards,

1 unchanged sentence

The remainder of the information

required in response to this Item 12 is included under the captions “Securities Ownership” in the Company's Proxy Statement,

required in response to this Item 12 is included under the caption “Securities Ownership” in the Company's Proxy Statement,

and such information is incorporated herein by reference.

4 unchanged sentences

Information required in response to this Item 13 is

included under the captions “Related Party Transactions” and “Board of Directors & Corporate Governance” in

the Company's Proxy Statement, and such information is incorporated herein by reference.

The Proxy Statement will be filed with the Securities

and Exchange Commission not later than March 31, 2023.

included under the captions “Corporate Governance, ESG and Our Approach to Risk Management” and “Our Board of Directors”

in the Company's Proxy Statement, and such information is incorporated herein by reference.

The Proxy Statement will be filed with the

Securities and Exchange Commission not later than March 31, 2024.

PRINCIPAL ACCOUNTING FEES AND

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Askew & Co., LLP , Jacksonville, Florida , Firm 794 .

Information required in response to this Item 14 is included under the captions

Information required in response to this Item 14 is included under the caption

The Auditor Proposal” in the Company’s Proxy Statement, and such information is incorporated herein by

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Chief Executive Officer

/s/ Martin E.

deVilliers, Jr.

President and Vice-Chair Director

(Principal Executive Officer)

/s/ Matthew S.

Treasurer and Chief Financial Officer

(Principal Financial Officer)

/s/ Nicole B.

Controller and Chief Accounting Officer

(Principal Accounting Officer)

/s/ Nicole B.

/ s/ William H.

Commander III

/s/ Margaret Wetherbee

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Item 15(a)(3)

Separation and Distribution Agreement, dated as of January 30, 2015, by and between FRP Holdings, Inc.

and Patriot Transportation Holding, Inc., incorporated herein by reference to Exhibit 2.1 to the Company’s Form 8-K filed on February 3, 2015.

Second Amended and Restated Articles of Incorporation of FRP Holdings, Inc., adopted February 4, 2015, incorporated herein by reference to Exhibit 3.1 of the Company’s Form 10-Q filed on May 8, 2015.

3 unchanged sentences

Description of Registrant’s Common Stock, incorporated herein by reference to Exhibit 4.3 of the Company’s Form 10-K filed on March 19, 2021.

Tax Matters Agreement, dated January 30, 2015, by and between FRP Holdings, Inc.

and Patriot Transportation Holding, Inc., incorporated herein by reference to Exhibit 10.1 to the Company’s Form 8-K filed on February 3, 2015.

Employee Matters Agreement, dated January 30, 2015, by and between FRP Holdings, Inc.

and Patriot Transportation Holding, Inc., incorporated herein by reference to Exhibit 10.2 to the Company’s Form 8-K filed on February 3, 2015.

Transition Services Agreement, dated January 30, 2015, by and between FRP Holdings, Inc.

and Patriot Transportation Holding, Inc., incorporated herein by reference to Exhibit 10.3 to the Company’s Form 8-K filed on February 3, 2015.

Summary of Medical Reimbursement Plan of FRP Holdings, Inc., incorporated herein by reference to an exhibit filed with Form 10-K for the fiscal year ended September 30, 1993.

1 unchanged sentence

Management Security Agreements between the Company and certain officers, incorporated herein by reference to a form of agreement previously filed (as Exhibit (10)(I)) with Form S-4 dated December 13, 1988.

F RP Holdings, Inc.

FRP Holdings, Inc.

2006 Stock Incentive Plan, incorporated herein by reference to an appendix to the Company’s Proxy Statement dated December 29, 2005.

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Klopfenstein, incorporated herein by reference to an exhibit filed with Form 10-Q for the quarter ended December 31, 2007.

2015 Credit Agreement, dated January 30, 2015, by and between the Company and Wells Fargo Bank, N.A., incorporated herein by reference to Exhibit 10.1 to the Company’s Form 10-Q/A filed on August 5, 2015.

Loan Agreement dated November 17, 2017, between Riverfront Holdings I, LLC and EagleBank, incorporated herein by reference to Exhibit 10.15 of the Company’s Form 10-K filed on March 16, 2018.

The Company's 2023 Annual Report to shareholders, portions of which are incorporated by reference in this Form 10-K.

8 unchanged sentences

Certification of Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer under Section 906 of the Sarbanes-Oxley Act of 2002.

Information Statement of Patriot Transportation Holding, Inc., dated January 12, 2015, incorporated by reference to the Company’s Form 8-K filed on January 13, 2015.

FRP Holdings, Inc.

Executive Officer Compensation Clawback Policy.

XBRL Instance Document Taxonomy Extension Schema

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Equity in loss of joint ventures

Gain on remeasurement of investment in real estate partnership

Gain on sale of real estate

Gain (loss) attributable to noncontrolling interest

Gain on sale of real estate and other income

Loss attributable to noncontrolling interest

Net income attributable to the Company

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To Our Shareholders,

Time is a funny thing.

The same summer

day that seems to last forever to the boy, is more or less the blink of an eye to his father.

A school year is an eternity to a student,

and yet the same year for the teacher or the parent running carpool passes so quickly as to have almost ended moments after it began.

The way time seemingly speeds up as one gets older is the basis of a theory that in terms of the way we perceive time, our lives

are halfway over by the time we turn 18.

Youth, maybe even more than we realized, is wasted on the young.

That’s a pretty depressing

And yet it gives one heart that even though time appears to move faster and faster, a lot can still happen in a year.

had so much going on in 2022, that it is hard to fathom (what with time moving so fast) that we got it all done in just 365 days.

we made our first mining royalty acquisition in a decade with our purchase of the Bland Property in Astatula, Florida, which helped propel

us to our largest revenue year ever for that segment.

2022 saw the stabilization and permanent financing of Riverside in Greenville, South

Carolina, as well as the completion of construction on and lease-up of both .408 Jackson (also in Greenville) and The Verge in DC.

2022, we added to our industrial development pipeline with the purchase of a new site in Cecil County, Maryland capable of supporting

900,000 square feet of industrial development, and we passed a major pre-development milestone with the unappealable annexation into Aberdeen,

Maryland of our 54 acres adjacent to Cranberry Run Business Park on which we plan to build 690,000 square feet of industrial.

year saw meaningful increases in revenue, operating profit, and pro-rata NOI across all segments with the highest pro-rata NOI total ever

for Stabilized Joint Ventures (17.05% increase to $9.47 million vs $8.09 million in 2021), the highest NOI total for Mining Royalties

(13.62% increase to $10.15 million vs $8.94 million in 2021), and the highest NOI total (39.22% increase to $2.67 million vs $1.92 million

in 2021) for our Asset Management segment since the sale of our warehouse portfolio in 2018.

Far and away the biggest news of 2022, however,

was our announcement in the beginning of the fourth quarter of our agreement to partner with Steuart Investment Company (SIC) and MidAtlantic

Realty Partners (MRP) in developing our collective properties in the Capitol Riverfront and Buzzard Point submarkets of Washington, DC.

We’ve mentioned the details of this agreement a number of times, but it bears repeating—this partnership plans to build over

three million square feet of mixed-use development comprising 3,000 residential units and 150,000 square feet of retail spread amongst

10 distinct multi-family projects (including Dock 79, The Maren, and The Verge) on or near the water.

This deal took over two years of

overtures, meetings, and negotiations to put in place, but the end result, in the words of Hamlet, “is a consummation devoutly to

be wished.” It will take over a decade to realize, but when all is said and done, your Company will have a meaningful share of nearly

every asset visible from the south entrance of the nation’s capital.

ASSET MANAGEMENT

The Asset Management segment, our industrial

assets in particular, produced strong results in 2022.

Increased occupancy and rent increases at our Cranberry Run Business Park as well

as full occupancy at one of the two new spec buildings at Hollander accounted for a 43% increase in revenue over calendar year 2021 as

well as a 39.22% increase in NOI.

All seven of our industrial assets are 100% leased, and six of the seven industrial buildings in-service

are 100% occupied with occupancy expected on the seventh in the first half of 2023.

Looking forward, we have completed construction on

a 101,750 square foot build-to-suit warehouse project and are awaiting the final certificate of occupancy and expect the tenant to move

in some time in the first half of 2023.

We have three other properties in our industrial development pipeline in various stages of predevelopment:

170 acres in Cecil County, Maryland, purchased in September 2022 and capable of supporting 900,000 square feet of industrial for which

we are currently pursuing entitlements;

17 acres in Aberdeen, Maryland where we have submitted grading and building permit applications

for 259,000 square-foot warehouse;

and a 54 acre site adjacent to our Cranberry Run Business Park capable of 690,000 square feet of industrial

which was just annexed into the town of Aberdeen, Maryland.

Given the current state and recent performance of our industrial portfolio,

management is excited to move forward with these projects in what has been, along with mining royalties, this Company’s “bread

and butter.” With nearly 1,850,000 square feet of potential industrial in our development pipeline, when the dust settles on these

projects, we will have expanded our existing industrial footprint by 358% to roughly 2.4 million square feet.

STABILIZED JOINT VENTURES

Stabilized Joint Ventures experienced a

shot in the arm to begin the year as the District of Columbia finally lifted its emergency protocols and allowed for rent increases on

Both properties benefitted from this return to free market economics.

This year, 61.45% of expiring leases at The Maren renewed

with an average increase in rent of 8.17%, and 61.40% of expiring leases renewed at Dock 79 with an average increase in rent of 5.91%.

Increases seemed to pick

up steam over the course of the year, culminating

in fourth quarter renewals of 42.31% of expiring leases at Dock 79 and 61.90% at The Maren, with an average rent increase on renewals

of 8.89% and 11.14% respectively.

This year we began to track “trade outs”—the increase in rent on a new lease when

we were not able to renew an expiring one.

In 2022, we saw an increase in rent on these trade outs of 7.4% at The Maren and 12.6% at Dock.

Inflation certainly has something to do with the numbers you’re seeing here, but it also demonstrates the extent to which rents

were held back by DC’s emergency protocols and just how far we had to push rents to get them back in line with what they should

have been barring restrictions.

Of course, the desirability of the assets in question had something to do with why we were able to attempt

this in the first place.

As mentioned previously, as part of the deal we reached in the fourth quarter with Steuart Investment Company,

SIC is now a 20% partner in both Dock 79 and The Maren.

SIC paid $65.3 million for their 20% stake, which places a $326.5 million combined

valuation on Dock 79 and The Maren.

Point being, we are excited about this new partnership and what it will build, but SIC’s

investment in our Riverfront projects shows how excited it is about what we have already built.

In the third quarter of 2022, we added

Riverside, our joint venture with Woodfield Development in Greenville, South Carolina, to the Stabilized Joint Ventures Segment after

it achieved stabilization (90% occupancy for 90 days).

As mentioned previously, we were concurrently able to permanently finance this

joint venture with a $32 million loan with a term of eight years at a fixed rate of 4.92%.

This loan is interest-only for the first five

years and has no prepayment penalty after the first three.

Riverside achieved stabilization in what management believed was a remarkably

short period of time (even accounting for how fast time passes for adults).

Lease-up began in the third quarter of 2021 and we achieved

stabilization in the third quarter of 2022.

That and the fact that the building’s 200 units were 98% leased with 92.5% occupancy

at year end speaks to the strength of the Greenville market and gives us confidence as we begin lease-up of .408 Jackson, our second joint

venture with Woodfield in Greenville.

MINING ROYALTIES

2022 was a huge year for mining royalties.

In the fourth quarter, the segment had its highest revenue quarter ever ($2.9 million), closing the books on its best year ever.

to 2022, mining royalties had never achieved $10 million in revenue in any fiscal year.

In 2022, this segment had over $10 million in

Surpassing the $10 million mark with $10.7 million in revenue, a 12.9% improvement over 2021, was primarily due to the acquisition

of the Bland Property (adjacent to, and part of the same Vulcan sand plant as our existing land in Astatula, Florida).

As you may recall,

we purchased this property in April of 2022 for $11.6 million.

This was the first property added to this segment since 2012 and only the

second property we’ve purchased for mining royalties since 1986.

It contains roughly 21.8 million tons in sand reserves on 1,500

acres and right now is our biggest royalty producing property by revenue.

Looking into 2023, we are still confident in the underlying

fundamentals of this business.

Increased demand in 2022 made for meaningful price increases (Martin Marietta:

10.5% increase on average

selling price over 2021, Vulcan Materials:

12.4% increase on average selling price in Q3 2022), and demand should remain strong in 2023

Total federal highway spending is expected to be in the ballpark of $72 billion this year, and over $102 billion in highway,

bridge, and tunnel projects were awarded in 2022, a 24% increase over the previous year.

The Cornyn-Padilla amendment to the 2023 Congressional

Appropriations Bill, now allows states to divert unused Covid relief funds for infrastructure projects.

To that end, in June 2022, Florida

released the largest budget in the history of the Florida Department of Transportation with over $12 billion in planned infrastructure

investment over the course of five years.

The boost in demand from the increase in infrastructure investments described above should translate

into price increases and help continue to drive the bottom line in this segment.

It has been management’s goal for

the last five years to put the proceeds of the asset sale to work in new projects.

While we have continued to put money to work in the

form of new investments, the goal of having a home for all our excess cash has eluded us.

Naturally it follows that since our last major

round of share buybacks in 2021, we have received a number of inquiries regarding our plans for returning at least part of the cash on

our balance sheet to investors in the form of additional buybacks or dividends.

If it was ever a consideration, the agreement with SIC

and MRP has eliminated it.

With the industrial and multifamily projects we have in front of us, it will take all of our current cash as

well as future cash flow to be able to make the equity investments that we have laid out over the next decade plus while maintaining a

reasonable capital cushion.

It is true that we are not building everything at once, and in every proforma we have run, there is always

a healthy amount of cash in the till.

But as we grow and have multiple projects in various stages of development, we believe our cash

is entirely too important as a capital cushion to risk what we’ve built by committing to dividends or further leveraging the Company

through a meaningful buyback program.

It is management’s position that dividends are for mature companies, not growing ones.

for the time being, we are definitely a growth company.

The near-term macroeconomic future is somewhat murky

to say the very least.

Inflation and economic growth play a daily tug-of-war with an increasingly schizophrenic market.

While we are planning

to grow, we are not going to be so committed to our current vision that it risks what has already been built.

We have been very conservative

in how we’ve grown the assets we own outright, and we have been just as careful in choosing partners in our joint ventures that

share our same attitude of deliberate, considerate growth and investment.

Whether a recession is around the corner, or the Fed can achieve

a soft landing is important to us, but it will not make or break this Company or our ability to grow it.

To borrow from Hamlet again,

“There is a special providence in the fall of a sparrow.

If it be now, ‘tis not to come;

if it be not to come, it will be

if it be not now, yet it will come.

The readiness is all.” This Company— your Company—will be ready.

It is a truth universally acknowledged,

at least in the investment world, that diversification on the company level is unnecessary if not out-and-out a bad thing.

of the conglomerates like Gulf & Western or GE at its Jack Welch peak, with their hands in multiple assets and industries and global

markets, is over.

Investor bias towards asset concentration makes sense on a number of levels:

it prevents empire building;

enough to “get smart” on one industry, let alone a multitude of unrelated industries;

investors don’t need companies

to diversify for them when they can do it themselves as they see fit.

The biggest argument against diversification on the company level

is that it complicates things.

Valuing one type of asset is easier than valuing multiple asset types.

This Company is not simple.

from a conglomerate, we have several business segments in different and unrelated facets of the real estate industry.

We have our in-house

projects and a multitude of joint ventures.

The investor who knows the apartment business might not want to take the time to get to know

the industrial space and almost certainly has limited exposure to the aggregates business.

That surface level complexity and lack of concentration

in one particular asset type is probably off-putting to some investors, especially for a company our size.

We are arguably the corporate

version of what Scott Fitzgerald referred to as “that most limited of all specialists—the well-rounded man.”

Our complexity is also part of the heritage

of this Company, and we believe we have made it into an asset.

Our mining royalties are the sole reason for this Company’s existence

and have been an instrumental component of the cashflow engine that has fueled our debt-free industrial development.

We could have sold

our land on the Anacostia River in DC, and deemed multifamily development outside of our focus, and we would have closed the door on owning

some of the best assets in one of the greatest cities in the world.

When we sold our industrial portfolio in 2018, we could have solely

concentrated on multi-family projects, and in doing so, we would have written off decades of industrial real estate experience, not to

mention the recent boom in industrial real estate values.

We are a full-service real estate developer

with expertise and experience in several asset classes at every stage of the development and ownership level.

The ability to shift our

capital, focus, and level of exposure between different asset classes is a good thing, and we believe it has served and will continue

to serve this Company and its investors well.

To that end, as we announced at our Investor Day in October, we are shifting our development

focus away from multifamily towards industrial.

The combination of both the shrinking of margins in the multifamily space because of the

cost of debt and materials, as well as the softening of the DC market as a glut of post-covid projects came on line in the last two years,

has led us to believe we are better off delaying any multifamily projects in that market.

We have long-term faith in the DC market, and

our partnership with MRP and the Steuart Investment Company to develop the Steaurt Family parcels is an amazing opportunity, but right

now the timing is wrong.

At the same time, despite the cost of materials, the industrial market is still excellent, and we can finance

most of the development in our industrial pipeline on an all-equity basis.

This is a perfect example of the benefit of having multiple

asset types in our development strategy.

Having a multifaceted development strategy

has served the Company well, but, as mentioned previously, it has also tended to muddy the waters for our investors.

We are a small company,

but in less than a decade we have shifted from an industrial asset manager with some development, to a developer with some asset management.

Furthermore, we are a JV partner in a multitude of projects, a capital partner, a lender… it’s a lot, and it has tended to

make our quarterly filings a trip to proverbial firehose for a drink of water.

While we have tried to play to our strengths and put our

cash to work, we have done a poor job of making our Company easier to understand.

In our effort to grow shareholder value, we have made

it harder for investors to wrap their arms around everything we do.

This complexity in a company our size is one reason why we believe

our stock price has never reflected our true net asset value.

In theory, we could just keep our heads down and do our jobs and wait for

an efficient market to recognize the fruits of our labor.

In reality, we have to be more proactive about explaining what we do, how we

do it, and where we are headed.

It is our belief that our development strategy is a strength, maybe our biggest strength.

makes us complex, and unless we want to turn our back on that very strategy, then we have to make it easier for the investing public to

understand us.

Our Investor Day in October was a good start.

Publishing a quarterly analysis of the estimated value of our assets is another

step in the right direction.

We are far from done.

INDUSTRIAL AND COMMERCIAL

In an attempt to further clarify what we

do, we have renamed our “Asset Management” and “Stabilized Joint Venture” segments.

Going forward, these will

be our “Industrial and Commercial” and “Multifamily” segments.

This change is purely cosmetic and does not shift

assets between segments and requires no restatement of financial results.

However, going forward, it does allow us to pursue industrial

joint ventures while still keeping like with like.

The Industrial and Commercial segment performed

well this year, growing revenues by 45.4% and NOI by 46.2% compared to 2022.

These increases are partly the result of rent growth at our

Cranberry Run Business Park, but mostly due to a full year of 100% occupancy of two of our buildings at Hollander Business Park as well

as the addition to this segment in March 2023 of a fully occupied 101,750 square-foot, build-to-suit warehouse at Hollander.

performance of this segment as well as the high demand for industrial product and its resilience to inflation is why we have shifted our

development focus towards industrial for the time being.

Industrial is our “bread and butter” and expanding our footprint

will be the main focus of our development strategy for some time.

Our Multifamily business segment had a

Dock 79 and the Maren experienced nominal revenue growth of 1.8% with average annual occupancy (94.36%, 95.60%), renewal rates

(68.29%, 53.23%), and increases on renewals (2.80%, 4.21%) in line with historic expectations.

There was an expected drop in pro rata

NOI compared to last year, due to the sale of our 20% TIC interest in both buildings to SIC, but total NOI for the buildings is down compared

to last year.

Rent growth did not keep pace with rising expenses and as mentioned previously, the DC market is soft right now due to a

significant number of buildings coming online after a Covid bottleneck, as evidenced by trade-outs at the Maren and Dock 79 of 1.90% and

-4.00% respectively.

These are still excellent assets in a beautiful area as anyone who came to the Investor Day we held at Dock 79 can

They are financed interest-only through March 2033 at a rate (3.03%) that now feels like a historical anomaly.

But the market,

like the Nationals, isn’t where it was before Covid, which is the reason why we’re hitting pause on multifamily development

in DC for the time being.

And like the market (but maybe not the Nationals), we believe strongly in the long-term future of Dock 79 and

the Maren, but we just need to wait out this ebb in the market and focus on expenses.

Conversely, we remain excited about Riverside,

our JV with Woodfield Development in Greenville, SC.

Riverside was added to this segment in the third quarter of last year after an exceptionally

brief lease-up and had an average annual occupancy of 94.51% with 55.41% of expiring leases renewing with an average increase of 8.46%.

Most importantly, Riverside added $800,000 of pro-rata NOI to this segment in its first full calendar year.

We remain bullish about the

Greenville market and look forward to adding .408 Jackson to this segment when it stabilizes in early 2024.

MINING ROYALTY LANDS

Mining royalties had a very strong 2023.

Once again, we had our highest revenue year ever in this segment, growing revenues to $12,527,000, a 17.3% improvement over what had previously

been our best revenue year ever in 2022.

Part of the reason for this increase was the additional royalties from the acquisition in Astatula,

FL that we completed in the second quarter of 2022, but the bulk of the increase came from increases in revenue at nearly every active

We are very fortunate to have the best operators in the aggregates industry for our tenants.

Vulcan Materials, our primary tenant,

has been aggressive with their pricing, growing their average sales price at all locations by 15% over 2022, as reported in their third

quarter investor presentation.

Martin Marrietta saw a 20% increase in average sales price according to their third quarter call.

and federal infrastructure spending are expected to continue their upward trend with a 14% increase in total state highway and bridge

capital spending anticipated in 2024 (on top of a 13% increase in 2023).

Combined with increases in non-residential construction, demand

in this sector should continue to be strong in 2024, even if interest rates dampen the pace of single-family home construction.

We have a three-part development strategy

which we use to grow our business:

1) In-House Development and Acquisition;

2) Joint Venture Development and Acquisition;

and 3) Principal

Capital Source Lending.

Since the sale of our legacy industrial assets in 2018, this three-pronged strategy is how we have gone about

putting our cash to work.

Our In-House strategy includes our industrial, commercial, and land development platform.

These properties are

developed, and managed 100% by FRP and

transferred from Development to the Industrial and Commercial segment when construction is completed and the building has its certificate

of occupancy.

As stated previously, industrial development through in-house projects as well as JV’s is the current focus of our

development strategy.

We have three in-house projects in our industrial pipeline in various stages of development which will eventually

join and drive NOI growth in the Industrial and Commercial segment.

During the second quarter of 2023, we broke ground on a 259,000 square-foot

building on our 17-acre parcel in Harford County, MD.

We expect shell completion on this building in the third quarter of 2024.

East, MD, along the I-95 corridor, we are in the middle of pre-development activities on 170 acres of industrial land that will ultimately

support a 900,000 square-foot distribution center.

We would be reluctant to build something this size as a spec building, but we will

be in a position to break ground as early as the fourth quarter of 2024 and would move forward on the project with an institutional capital

partner or take it on ourselves as a build-to-suit.

Finally, we are studying multiple conceptual designs for our 55-acre tract in Harford

County, MD adjacent to the Cranberry Run Business Park.

Our various configurations should yield from 600,000 to 700,000 square feet dependent

on final design parameters and market demands.

Completion of these three industrial development

projects will add over 1.8 million square feet of additional warehouse product to our Industrial and Commercial business segment as well

as meaningfully increase this segment’s NOI once these assets are all fully stabilized.

Our Joint Venture development and acquisition

strategy focuses on projects developed in conjunction with outside partners, where FRP is typically the majority owner through an equity

contribution in the form of land we already own, capital, or a combination of the two.

We seek out developers with expertise in a particular

market or asset class, who will handle day-to-day operations, but will also share in acquisition, development, and asset management costs.

The lion’s share of assets within our development segment are part of our joint-venture strategy.

These include our opportunity

zone investments in The Verge and Bryant Street in Washington, DC and .408 Jackson in Greenville, SC.

All three of these assets are close

to stabilization (90% occupancy for 90 days) and will join the Multifamily segment in 2024, adding 1,058 units to this segment.

is also in the process of pursuing its first industrial joint ventures.

We believe this is the best way to start expanding beyond our

traditional footprint into industrial markets that meet all our development criteria (high barriers to entry, employment/population growth,

transportation infrastructure, etc.) that we wouldn’t have the bandwidth to develop ourselves.

The third prong of our development strategy

is Principal Capital Lending.

The chief component of this strategy has been what you’ve heard us refer to as “Lending Ventures.”

It is a program where we lend the capital to a developer to use toward the entitlement and horizontal development of residential land.

This land is pre-sold prior to commencement of any infrastructure improvements, and ultimately transferred to national homebuilders.

top of the interest accumulated, we then share in the profits from the lot sales.

We have two current lending venture projects in various

stages of development.

The first is a project called Amber Ridge in Prince George’s County, MD.

All 187 units have been sold and

we received $20.2 in preferred interest and principal on $18 million in principal draws.

The second is called Aberdeen Overlook, a 344

lot 110-acre residential development project in Aberdeen, MD.

We have committed $31.1 million in funding under similar terms as Amber

Ridge (10% interest rate, 20% preferred return, split of proceeds beyond 20%).

A national homebuilder is under contract to purchase all

of the finished building lots which will include 222 townhomes and 122 single family dwellings.

Horizontal construction has begun, and

the first 11 lots were purchased prior to year end.

This development strategy has been incredibly useful as a way to put money to work

at attractive rates of return during a time when we had more cash than projects in which to put the cash to use.

Since the asset sale in 2018, we have used

our development strategy to put over $300 million of equity capital to work in a multitude of projects and asset classes (plus another

$30 million of share repurchases).

In so doing, we have grown our pro-rata NOI from $13.6 million at the end of 2018 to $30.2 million

in 2023 for a compound annual growth rate of 17.3%.

That kind of growth was only possible because we were a small, nimble company with

an entrepreneurial attitude towards putting capital to work.

As mentioned before, that kind of growth also made us incredibly complex

to shareholders in a way I’m not sure management fully appreciated.

We don’t want to let the tail wag the dog and stifle growth

opportunities for fear that they may further complicate us, but this Company must and will make it a priority to bring our investor relations

to the level of the kind of Company we want to be.

In the twelve months since this letter

last reached you, unemployment remains low and yet we have started to see inflation cool, the economy continues to grow at a healthy clip,

interest rates appear stable, and the elusive soft landing

now seems like a real possibility.

always maintain a healthy capital cushion, but we feel very comfortable putting a meaningful amount of our cash to work in our current

development strategy.

This Company—your Company—has come a very long way in the last five years, and as exciting as that was,

we sincerely believe we are just getting started.

Respectfully yours,

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interest rates, inflation and general economic conditions;

demand for warehouse/office facilities in the Baltimore-Washington-Northern

Virginia area;

demand for apartments in Washington D.C., Richmond, Virginia and Greenville, South Carolina;

and ability to obtain zoning

and entitlements necessary for property development.

However, this list is not a complete statement of all potential risks or uncertainties.

demand for industrial and commercial facilities

in the Baltimore-Washington-Northern Virginia area;

demand for apartments in Washington D.C., Richmond, Virginia and Greenville, SC;

ability to obtain zoning and entitlements necessary for property development.

However, this list is not a complete statement of all potential

risks or uncertainties.

These forward-looking statements are made

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This land is generally held by the Company in four distinct segments:

(i) Asset Management Segment

(land owned and operated as income producing rental properties in the form of commercial properties), (ii) Mining Royalty Lands Segment

(land owned and leased to mining companies for royalties or rents), (iii) Development Segment (land owned and held for investment to be

further developed for future income production or sales to third parties), and (iv) Stabilized Joint Venture Segment (ownership, leasing

and management of buildings through joint ventures).

Asset Management Segment.

(i) Industrial and Commercial

Segment (land owned and operated as income producing rental properties in the form of commercial properties), (ii) Mining Royalty Lands

Segment (land owned and leased to mining companies for royalties or rents), (iii) Development Segment (land owned or joint ventures held

for investment to be further developed for future income production or sales to third parties), and (iv) Multifamily Segment (ownership,

leasing and management of buildings through joint ventures).

Industrial and Commercial Segment.

As of December

2022, the Asset Management Segment includes eight buildings at four commercial properties owned by the Company in fee simple as follows:

31, 2023, the Industrial and Commercial Segment includes nine buildings at four commercial properties owned by the Company in fee simple

1) 34 Loveton Circle in suburban Baltimore County,

Maryland consists of one office building totaling 33,708 square feet which is 95.1% occupied (16% of the space is occupied by the Company

for use as our Baltimore headquarters).

MD consists of one office building totaling 33,708 square feet which is 90.8% occupied (16% of the space is occupied by the Company for

use as our Baltimore headquarters).

The property is subject to commercial leases with various tenants.

21 st Street in Duval County,

Florida was an office building property that remains under lease through March 2026.

We permitted the tenant to demolish all structures

on the property during 2018.

3) Cranberry Run Business Park in Hartford County,

Maryland consists of five office buildings totaling 267,737 square feet which are 100% occupied and 100% leased.

FL was an office building property that remains under lease through March 2026.

We permitted the tenant to demolish all structures on

the property during 2018.

3) Cranberry Run Business Park in Harford County,

MD consists of five industrial buildings totaling 267,737 square feet which are 92.1% occupied and 92.1% leased.

The property is subject

to commercial leases with various tenants.

4) Hollander 95 Business Park in Baltimore City, Maryland

consists of two buildings totaling 145,590 square feet that were completed in the fourth quarter of 2021 and are 100.0% leased and 45.4%

4) Hollander 95 Business Park in Baltimore City, MD

consists of three industrial totaling 247,340 square feet that are 100.0% leased and 100.0% occupied.

Mining Royalty Lands Segment – Mining Properties.

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annual sales price per ton sold.

In certain locations, typically where the reserves on the property have been depleted but the tenant

still has a need for the leased land, we collect a minimum annual rental amount.

In the fiscal years ended December 31, 2022, 2021 and

2020, aggregate tons sold with respect to the Company’s mining properties were approximately 9,525,000, 7,575,000 and 8,206,000,

respectively.

In certain locations, typically where the sand and stone deposits on the property have been depleted

but the tenant still has a need for the leased land, we collect a minimum annual rental amount.

In the fiscal years ended December 31,

2023, 2022 and 2021, aggregate tons sold with respect to the Company’s mining properties were approximately 9,569,000, 9,525,000

and 7,575,000, respectively.

In May 2014, the Company entered into an amendment

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The segment also owns an additional 36 acres of investment property in Brooksville, Florida.

Development Segment – Warehouse/Office Land.

Development Segment – Industrial and Commercial

At December 31, 2023, this segment owned the following

future development parcels:

1) Six acres of horizontally developed land at Hollander Business Park in Baltimore City, Maryland with one

101,750 square feet industrial build-to-suit awaiting final certificate of occupancy.

1) 54 acres of land that will be capable of supporting over 690,000 square feet of industrial product located

at 1001 Old Philadelphia Road in Aberdeen, Maryland.

3) 17 acres of land in Harford County, Maryland that can accommodate 259,000 square feet of industrial development.

4) 170 acres of land Cecil County, Maryland that can accommodate 900,000 square feet of industrial development.

Development Segment – Land Held for Investment

At December 31, 2022, this segment owned the following

development parcels:

at 1001 Old Philadelphia Road in Aberdeen, MD.

2) 17 acres of land in Harford County, MD with a 259,200 square feet speculative warehouse project on Chelsea

Road under construction due to be complete in the third quarter of 2024.

3) 170 acres of land Cecil County, MD that can accommodate 900,000 square feet of industrial development.

Development Segment – Land Held for Development

At December 31, 2023, this segment was invested in

the following development parcels:

1) Riverfront on the Anacostia:

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The first phase (now known as Dock 79), which was completed through a joint venture with MRP Realty, and which

consisted of a single building with residential and retail uses, became our fourth business segment in July 2017, now known as the Stabilized

Joint Venture Segment.

The second phase (now known as The Maren), also completed through a joint venture with MRP Realty and consists

of a single building with residential and retail uses, was added to the Stabilized Joint Venture Segment effective March 31, 2021.

final two phases,

Phase 3 and Phase 4 remain under a first-stage

PUD approval expiring April 5, 2023, permitting 500,000 square feet of development.

consisted of a single building with residential and retail uses, became our fourth business segment in July 2017, now known as the Multifamily

The second phase (now known as The Maren), also completed through a joint venture with MRP Realty and consists of a single building

with residential and retail uses, was added to the Multifamily Segment effective March 31, 2021.

The final two phases, Phase 3 and Phase

4 remain under a first-stage PUD approval expiring March 30, 2025, permitting 571,671 square feet of development.

2) Hampstead Trade Center:

The Hampstead Trade Center property in Hampstead, Carroll County, Maryland is

a 118-acre parcel located adjacent to the State Route 30 bypass.

The parcel was previously zoned for industrial use, but our request for

rezoning for residential use was approved in December 2018.

The Hampstead Trade Center property in Carroll County, MD is a 118-acre parcel

located adjacent to the State Route 30 bypass.

The parcel was previously zoned for industrial use, but our request for rezoning for residential

use was approved in December 2018.

Management believes this to be a higher and better use of the property.

are fully engaged in the formal process of seeking PUD entitlements for this tract, which is now known as “Hampstead Overlook”.

We are fully engaged in the

formal process of seeking PUD entitlements for this tract, which is now known as “Hampstead Overlook”.

3) Bryant Street:

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units and 91,607 square feet of first floor and stand-alone retail on approximately five acres of the roughly 12-acre site.

is complete and leasing efforts are under way.

is complete and leasing efforts are nearing completion.

4) The Verge:

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Construction is complete and leasing is under way.

Lease-up is underway and

at December 31, 2023, the building was 90.7% leased and 85.8% occupied inclusive of 25 units licensed to Placemakr Management for a short-term

corporate rental program.

5) Square 664E:

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In December 2019, the Company entered into a joint venture with a new partner, Woodfield

Development, for the acquisition and development of a mixed-use project known as “.408 Jackson” in Greenville, South Carolina.

Woodfield specializes in Class-A multi-family, mixed-use developments primarily in the Carolinas and DC.

The project is located across

the street from Greenville’s minor league baseball stadium and holds 227 multi-family units and 4,539 square feet of retail space.

It is located in an Opportunity Zone, which provides tax benefits in the new communities’ development program as established by

Congress in the Tax Cuts and Jobs Act of 2017.

Development, for the acquisition and development of a mixed-use project known as “.408 Jackson” in Greenville, SC.

specializes in Class-A multifamily, mixed-use developments primarily in the Carolinas and DC.

The project is located across the street

from Greenville’s minor league baseball stadium and holds 227 multifamily units and 4,539 square feet of retail space.

It is located

in an Opportunity Zone, which provides tax benefits in the new communities’ development program as established by Congress in the

Tax Cuts and Jobs Act of 2017.

The temporary certificate of occupancy was received in December 2022.

Leasing began in

the fourth quarter of 2022 with residential units 21.6% leased and 4.9% occupied at quarter end.

Retail at this location is 100%.

Company owns 40% of the development.

Leasing began in the fourth quarter

of 2022 with residential units 95.2% leased and 93.4% occupied at quarter end.

Retail at this location is 100% leased.

The Company owns

40% of the development.

7) Windlass Run:

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Johns Properties Inc., a Baltimore

development company, to jointly develop the remaining lands of our Windlass Run Business Park, located in Middle River, Maryland, into

a multi-building business park consisting of approximately 329,000 square feet of single-story office space.

The project will take place

in several phases, with construction of the first phase, which includes two office buildings and two retail buildings totaling 100,030-square-feet

(inclusive of 27,950 retail), commenced in the fourth quarter of 2017 and was completed in January 2019.

At December 31, 2022 Phase I

was 50.7% leased and 48.0% occupied, the subsequent phases will follow as each phase is stabilized.

development company, to jointly develop the remaining lands of our Windlass Run Business Park, located in Middle River, MD, into a multi-building

business park consisting of approximately 329,000 square feet of single-story office space.

The project will take place in several phases.

Construction of the first phase, which includes two office buildings and two retail buildings totaling 100,030-square-feet, commenced

in the fourth quarter of 2017 and was completed in January 2019.

At December 31, 2023 Phase I was 73.4% leased and 62.8% occupied, the

subsequent phases will follow as each phase is stabilized.

In August 2022, the Company invested $3.6 million for a 16% interest in a joint venture with Woodfield

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at that point.

Stabilized Joint Venture Segment.

At December 31, 2022, this segment owned the following

stabilized joint ventures:

9) Buzzard Point:

In November 2022, the Company entered into a contribution agreement with MRP and Steuart

Investment Company (SIC) regarding potential development of an estimated 1,200 multifamily units in four

phases on land owned by SIC.

entered into a separate agreement with MRP to perform pre-development obligations for the contribution agreement.

The company owns 50%

of the partnership with MRP.

In August 2023, the Company entered into an agreement with Woodfield Development for the acquisition

and development of a mixed-use project known as “Woven” in Greenville, SC, to consist of an estimated 214 multifamily units

and 10,000 square feet of retail space.

The joint venture is in the pre-development and pre-closing phase in pursuit of vertical construction

closing conditions.

The Company owns 50% at this time with final ownership to be determined based upon contributions by the partners,

land contributors, and other investors.

Multifamily Segment.

At December 31, 2023, this segment was invested in

the following stabilized multifamily joint ventures:

In 2014, approximately 2.1 acres (Phase I) of the total 5.8-acres

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3) Riverside:

On December 23, 2019 the Company and Woodfield formed a joint venture to develop a 200-unit

residential apartment project located at 1430 Hampton Avenue, Greenville, SC.

The project is located in an Opportunity Zone, which provides

tax benefits in the new communities’ development program as established by Congress in the Tax Cuts and Jobs Act of 2017.

contributed $6.2 million in exchange for a 40% ownership in the joint venture.

On December 23, 2019 the Company and Woodfield formed a joint

venture to develop a 200-unit residential apartment project located at 1430 Hampton Avenue, Greenville, SC.

The project is located in

an Opportunity Zone, which provides tax benefits in the new communities’ development program as established by Congress in the Tax

Cuts and Jobs Act of 2017.

The Company contributed $6.2 million in exchange for a 40% ownership in the joint venture.

Five Year Summary

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Total Fiscal Year 2022

Operating profit (loss)

Income (loss) from continuing operations

Net income (loss) attributable to the Company

Operating profit

Income from continuing operations

Net income attributable to the Company

Earnings per common share (a):

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United States and consist of:

Lands leased to mining companies,

some of which will have second lives as development properties;

Mining royalty lands, some of

which will have second lives as development properties;

Residential apartments in Washington,

and Greenville, South Carolina;

and Greenville, SC;

Warehouse or office properties

in the Mid-Atlantic states either existing or under development;

in Maryland either existing or under development;

Mixed-use properties under development

in Washington, D.C.

or Greenville, South Carolina;

or Greenville, SC;

Properties held for sale.

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Reportable Segments

We conduct primarily all of our business in the following

four reportable segments:

(1) asset management (2) mining royalty lands (3) development and (4) stabilized joint ventures.

For more information regarding our reportable segments, see Note 10.

Business Segments of our consolidated financial statements

included in this annual report.

We conduct all of our business in the following four

reportable segments:

(1) industrial and commercial (2) mining royalty lands (3) development and (4) multifamily.

information regarding our reportable segments, see Note 10.

Business Segments of our consolidated financial statements included

in this annual report.

Highlights of 2023 .

· 43.0% increase in asset management revenue versus

· Highest twelve-month total of mining royalties revenue

in segment’s history;

12.9% increase in revenue over calendar year 2021.

First year with over $10 million in revenue as well as

· 37.98% increase in our pro-rata NOI ($24.23 million

vs $17.56 million) compared to last year.

· Each segment’s highest revenue, operating profit,

and NOI total since asset sale in 2018.

· Sale of Hickory Creek for $8.83 million on an investment

of $6 million.

· Deal signed with Steuart Investment Company (SIC)

and MidAtlantic Realty Partners (MRP) for development of ten mixed-use projects in Capitol Riverfront and Buzzard Point submarkets of

DC including sale of 20% ownership

interest in tenancy-in-common (TIC) of Dock 79 and The Maren for $65.3 million, $44.5 million attributable to the Company.

Asset Management Segment.

The Asset Management segment owns, leases and manages

commercial properties.

These assets create revenue and cash flows through tenant rental payments, lease management fees and reimbursements

for building operating costs.

The Company’s industrial warehouses typically lease for terms ranging from 3 – 10 years often

with 1 or 2 renewal options.

All base rent revenue is recognized on a straight-lined basis.

All of the commercial warehouse leases

are triple net and common area maintenance costs (CAM Revenue) are billed monthly, and insurance and real estate taxes are billed annually.

34 Loveton is the only office product wherein all leases are full service therefore there is no CAM revenue.

Office leases are also

recognized on a straight-lined basis.

The major cash outlays incurred in this segment are for operating expenses, real estate taxes, building

repairs, lease commissions and other lease closing costs, construction of tenant improvements, capital to acquire existing operating buildings

and closing costs related thereto and personnel costs of our property management team.

As of December 31, 2022, the Asset Management Segment

includes eight buildings at four commercial properties owned by the Company in fee simple as follows:

· 24.8% increase in pro-rata NOI ($30.24 million vs $24.23 million)

· Mining Royalties revenues increased 17.3%;

17% increase in royalties per

· 45.4% increase in Industrial and Commercial revenue;

46.2% increase in Industrial

and Commercial NOI

Industrial and Commercial Segment.

The Industrial and Commercial segment owns, leases

and manages commercial properties.

These assets create revenue and cash flows through tenant rental payments, lease management fees and

reimbursements for building operating costs.

The Company’s industrial warehouses typically lease for terms ranging from 3 –

10 years often with one or two renewal

All base rent revenue is recognized

on a straight-lined basis.

All of the commercial warehouse leases are triple net and common area maintenance costs (CAM Revenue) are billed

monthly, and insurance and real estate taxes are billed annually.

34 Loveton is the only office product wherein all leases are full service

therefore there is no CAM revenue.

Office leases are also recognized on a straight-lined basis.

The major cash outlays incurred in

this segment are for operating expenses, real estate taxes, building repairs, lease commissions and other lease closing costs, construction

of tenant improvements, capital to acquire existing operating buildings and closing costs related thereto and personnel costs of our property

management team.

As of December 31, 2023, the Industrial and Commercial

Segment includes nine buildings at four commercial properties owned by the Company in fee simple as follows:

1) 34 Loveton Circle in suburban Baltimore County,

Maryland consists of one office building totaling 33,708 square feet which is 95.1% occupied (16% of the space is occupied by the Company

for use as our Baltimore headquarters).

MD consists of one office building totaling 33,708 square feet which is 90.8% occupied (16% of the space is occupied by the Company for

use as our Baltimore headquarters).

The property is subject to commercial leases with various tenants.

21 st Street in Duval County,

Florida was an office building property that remains under lease through March 2026.

We permitted the tenant to demolish all structures

on the property during 2018.

3) Cranberry Run Business Park in Hartford County,

Maryland consists of five office buildings totaling 267,737 square feet which are 100% occupied and 100% leased.

FL was an office building property that remains under lease through March 2026.

We permitted the tenant to demolish all structures on

the property during 2018.

3) Cranberry Run Business Park in Harford County,

MD consists of five industrial buildings totaling 267,737 square feet which are 92.1% occupied and 92.1% leased.

The property is subject

to commercial leases with various tenants.

4) Hollander 95 Business Park in Baltimore City, Maryland

consists of two buildings totaling 145,590 square feet that were completed in the fourth quarter of 2021and are 100.0% leased and 45.4%

4) Hollander 95 Business Park in Baltimore City, MD

consists of three industrial buildings totaling 247,340 square feet that are 100.0% leased and 100.0% occupied.

Management focuses on several factors to measure our

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Other than one location in Virginia, all of these properties are located in Florida and Georgia.

Company leases land under long-term leases that grant the lessee the right to mine and sell reserves from our property in exchange for

royalty payments.

Company leases land under long-term leases that grant the lessee the right to mine and sell sand and stone deposits from our property

in exchange for royalty payments.

A typical lease has an option to extend the lease for additional terms.

The typical lease in this segment requires the

tenant to pay us a royalty based on the number of tons of mined materials sold from our property during a given fiscal year multiplied

by a percentage of the average annual sales price per ton sold.

As a result of this royalty payment structure, we do not bear the cost

risks associated with the mining operations, however, we are subject to the cyclical nature of the construction markets in these states

as both volumes and prices tend to fluctuate through those cycles.

In certain locations, typically where the reserves on our property

have been depleted but the tenant still has a need for the leased land, we collect a minimum annual rental amount.

We believe strongly

in the potential for future growth in construction in Florida, Georgia, and Virginia which would positively benefit our profitability

in this segment.

The typical lease in this segment

requires the tenant to pay us a royalty based on the number of tons of mined materials sold from our property during a given fiscal year

multiplied by a percentage of the average annual sales price per ton sold.

As a result of this royalty payment structure, we do not bear

the cost risks associated with the mining operations, however, we are subject to the cyclical nature of the construction markets in these

states as both volumes and prices tend to fluctuate through those cycles.

In certain locations, typically where the sand and stone deposits

on our property have been depleted but the tenant still has a need for the leased land, we collect a minimum annual rental amount.

believe strongly in the potential for future growth in construction in Florida, Georgia, and Virginia which would positively benefit our

profitability in this segment.

In the fiscal year ended December 31, 2023, a total of 9.6 million tons were mined.

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by increases in production at our locations.

Our current mining tenants include Vulcan Materials, Martin Marietta, Cemex, Argos and The

Concrete Company.

Our current mining tenants are Vulcan Materials, Martin Marietta, Cemex, Argos and The Concrete

Additionally, these locations provide us with opportunities

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Development of Regional of Impact and County Land Use and Master Zoning in place for 5,800 residential unit, mixed-use development

Approval in place for 105, 1 acre, waterfront residential lots after mining completed.

Approval in place for 105, one-acre, waterfront residential lots after mining completed.

Development Segment.

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costs, property taxes, design and permitting, the personnel costs of our in-house management team and horizontal and vertical construction

Development Segment – Warehouse/Office Land.

Development Segment – Industrial and Commercial

At December 31, 2023, this segment owned the following

future development parcels:

1) Six acres of horizontally developed land at Hollander Business Park in Baltimore City, Maryland with one

101,750 square feet industrial build-to-suit awaiting final certificate of occupancy.

1) 54 acres of land that will be capable of supporting over 690,000 square feet of industrial product located

at 1001 Old Philadelphia Road in Aberdeen, Maryland.

3) 17 acres of land in Harford County, Maryland that can accommodate 259,000 square feet of industrial development.

4) 170 acres of land in Cecil County, Maryland that can accommodate 900,000 square feet of industrial development.

at 1001 Old Philadelphia Road in Aberdeen, MD.

2) 17 acres of land in Harford County, MD that can accommodate 259,200 square foot speculative warehouse

project on Chelsea Road under construction due to be complete in the third quarter of 2024.

3) 170 acres of land in Cecil County, MD that can accommodate 900,000 square feet of industrial development.

We also have three properties that were either spun-off

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estate developers which are summarized below:

Brooksville Quarry, LLC near Brooksville, Florida

Brooksville Quarry, LLC near Brooksville, FL

Vulcan Materials Company

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Development of 329,000 square feet multi-building business park in progress

Bryant Street Partnerships for 5 acres of land in Washington, D.C.

Mixed-use development with 487 residential units and 91,661 square feet of retail partially completed

Aberdeen Station residential development in Harford County, Maryland

Bryant Street Partnerships for five acres of land in Washington, D.C.

Mixed-use development with 487 residential units and 91,607 square feet of retail

Aberdeen Overlook residential development in Harford County, MD

$31.1 million in exchange for an interest rate of 10% and a 20% preferred return after which the Company is also entitled to a portion of proceeds from sale

Amber Ridge residential development in Prince George’s County, Maryland

Amber Ridge residential development in Prince George’s County, MD

$18.5 million in exchange for an interest rate of 10% and a 20% preferred return after which the Company is also entitled to a portion of proceeds from sale

The Verge at 1800 Half Street property in Buzzard Point area of Washington, D.C.

Construction of eleven-story structure with 344 apartments and 8,536 square feet of ground floor retail underway

Eleven-story structure with 344 apartments and 8,536 square feet of ground floor retail currently underway with lease-up

.408 Jackson property in Greenville, SC

Woodfield Development

Construction of mixed-use project with 227 multifamily units and 4,539 square feet of retail space began in May 2020

Mixed-use project with 227 multifamily units and 4,539 square feet of retail space currently underway with lease-up

Woodfield Development

Mixed-use project with 554 multifamily units, 72,000 square feet of commercial space, 41,000 square feet of office space and a boutique 170-key hotel

Pre-development activities for a mixed-use project with 554 multifamily units, 72,000 square feet of commercial space, 41,000 square feet of office space and a boutique 170-key hotel

FRP/MRP Buzzard Point Sponsor, LLC

Pre-development activities for phase one of property owned by Steuart Investment Company (SIC) under a Contribution and Pre-Development Agreement between this partnership and SIC

Woven property in Greensville, SC

Woodfield Development

Pre-development activities for a mixed-use project with approximately 214 multifamily units and 10,000 square feet of retail space

Joint ventures where FRP is not the primary beneficiary

(including those in the Stabilized Joint Venture Segment) are reflected in the line “Investment in joint ventures” on the

balance sheet and “Equity in loss of joint ventures” on the income statement.

The following table summarizes the Company’s

investments in unconsolidated joint ventures (in thousands):

(including those in the Multifamily Segment) are reflected in the line “Investment in joint ventures” on the balance sheet

and “Equity in loss of joint ventures” on the income statement.

The following table summarizes the Company’s investments

in unconsolidated joint ventures (in thousands):

Share of Profit

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Of the Partnership

Partnership (1)

As of December 31, 2023

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Lending ventures

DST Hickory Creek

Estero Partnership

1800 Half St.

Verge Partnership

Greenville Partnerships

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Bryant Street

1800 Half St.

Investments in real estate, net

Cash and cash equivalents

Cash and restricted cash

Unrealized rents & receivables

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Investments in real estate, net

Cash and cash equivalents

Cash and restricted cash

Unrealized rents & receivables

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Total Liabilities and Capital

Stabilized Joint Venture Segment .

Multifamily Segment .

At year end, the segment included three stabilized

joint ventures which own, lease and manage buildings.

These assets create revenue and cash flows through tenant rental payments, and reimbursements

for building operating costs.

The Company’s residential spaces generally lease for 12 – 15-month lease terms and 90 days prior

to the expiration, as long as there is no balance due, the tenant is offered a renewal.

If no notice to move out or renew is made, then

the leases go to month to month until notification of termination or renewal is received.

multifamily joint ventures which own, lease and manage buildings.

These assets create revenue and cash flows through tenant rental payments,

and reimbursements for building operating costs.

The Company’s residential spaces generally lease for 12 – 15-month lease

terms and 90 days prior to the expiration, as long as there is no balance due, the tenant is offered a renewal.

If no notice to move out

or renew is made,

then the leases go to month-to-month until notification

of termination or renewal is received.

Renewal terms are typically 9 – 12 months.

March 2020 through the end of 2021, we were prohibited from increasing rent on renewals by emergency measures in Washington, DC designed

to ease the burden of the pandemic on its citizens.

From March 2020 through the end of 2021,

we were prohibited from increasing rent on renewals by emergency measures in Washington, DC designed to ease the burden of the pandemic

on its citizens.

These measures expired at the end of 2021.

The Company also leases retail spaces at

apartment/mixed-use properties.

The retail leases are typically 10 -15-year leases with options to renew for another 5 years.

leases at these properties also include percentage rents which average 3-6% of annual sales for the tenant that exceed a breakpoint stipulated

by each individual lease.

All base rent revenue is recognized on a straight-line basis.

The major cash outlays incurred in this segment

are for property taxes, full service maintenance, property management, utilities and marketing.

The three stabilized joint venture properties

are as follows:

The Company also leases retail spaces at apartment/mixed-use properties.

retail leases are typically 10 -15-year leases with options to renew for another five years.

Retail leases at these properties also

include percentage rents which average 3-6% of annual sales for the tenant that exceed a breakpoint stipulated by each individual lease.

base rent revenue is recognized on a straight-line basis.

The major cash outlays incurred in this segment are for property taxes, full

service maintenance, property management, utilities and marketing.

The three multifamily properties are as follows:

Property and Occupancy

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Lease revenue

Mining lands lease revenue

Mining royalty revenue

Total Revenues

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Equity in loss of joint ventures

Gain on remeasurement of investment in real estate partnership

Gain on sale of real estate

Gain on sale of real estate and other income

Income before income taxes

Provision for income taxes

(Loss) gain attributable to noncontrolling interest

Loss attributable to noncontrolling interest

Net income attributable to the Company

Net income attributable to the Company for 2022 was

$4,565,000 or $.48 per share versus $28,215,000 or $3.00 per share in the same period last year.

Net income for calendar year 2021 included

a gain of $51.1 million on the remeasurement of investment in The Maren real estate partnership, which is included in Income before income

This gain on remeasurement was mitigated by a $10.1 million provision for taxes and $14.0 million attributable to noncontrolling

Net income for 2023 was $5,302,000 or $.56 per share

versus $4,565,000 or $.48 per share in the same period last year.

The calendar year 2023 was impacted by the following items:

· The period includes $547,000 amortization expense compared to $3,899,000

in the same period last year.

Amortization expense in 2021 was impacted by the $4,750,000 fair value of The Maren’s leases-in-place

established when we booked this asset as part of the gain on remeasurement upon consolidation of this Joint Venture.

The value placed

on these leases was amortized over the life of the leases, which was on average one year.

· Net investment income increased $1,258,000 due to a $1,119,000 increase

in interest earned on cash equivalents, a $199,000 increase in income from our lending ventures.

Investment income was mitigated by a

$60,000 decrease in preferred interest from our joint ventures due to the repayment of our preferred equity interest in The Maren.

· Interest expense increased $741,000 compared to the same quarter last year

due to less capitalized interest.

We capitalized less interest because of fewer in-house and joint venture projects under development

this year compared to last year.

· Equity in loss of Joint Ventures decreased $33,000 due to a $2,832,000 gain

on the sale of DST Hickory Creek mostly offset by increased depreciation and amortization at our joint ventures due to buildings placed

· The period includes $874,000 in gain on sales of excess property at Brooksville

compared to $805,000 for an easement and sale of excess property in the same segment in the prior year.

Asset Management Segment Results

Operating profit increased $3,704,000 compared to

the same period last year due to improved revenues and profits in all four segments.

Management company indirect increased $553,000 due

to merit increases and new hires along with recruiting costs.

Interest income increased $5,424,000 primarily due

to an increase in interest earned on cash equivalents ($4,307,000) and increased income from our lending ventures ($1,202,000).

Interest expense increased $1,270,000 compared to

the same period last year due to less capitalized interest.

We capitalized less interest because of fewer in-house and joint venture projects

under development compared to last year.

Equity in loss of Joint Ventures increased $6,216,000

primarily due to increased losses during lease up at The Verge ($4,418,000) and .408 Jackson ($799,000), a gain on the sale of DST Hickory

Creek ($2,832,000) last year mitigated by a gain of $1,886,000 on our guarantee liability for the refinanced Bryant Street loan.

Calendar year 2022 included an $874,000 gain on sales

of excess property at Brooksville.

Industrial and Commercial Segment Results

Twelve months ended December 31

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Cost of operations

Operating profit (loss)

Operating profit

Total revenues in this segment were $5,354,000, up

$1,673,000 or 45.4%, over the same period last year.

Operating profit was $960,000, up $1,191,000 from an operating loss of $(231,000)

in the same period last year.

Revenues and operating profit are up because of improved occupancy and rent growth at Cranberry Run and

full occupancy at 1865 62nd Street which was placed into service in the fourth quarter of 2021.

Net Operating Income this year for this

segment was $2,666,000 up $751,000 or 39.2% compared to calendar year 2021.

Operating profit was $1,764,000, up $804,000 from $960,000 in the same period last

Revenues and operating profit are up partly because of rent growth at Cranberry Run, but primarily because of full occupancy at

1865 and 1841 62 nd Street and the addition of 1941 62 nd Street to this segment in March 2023.

Net operating income

in this segment was $3,898,000, up $1,232,000 or 46.2% compared to the same period last year.

Mining Royalty Lands Segment Results

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(dollars in thousands)

Mining lands lease revenue

Mining royalty revenue

Depreciation, depletion and amortization

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in the same period last year.

This increase is primarily the result of the additional royalties from the acquisition in Astatula, Florida,

which we completed at the beginning of the second quarter.

This increase is the result of the additional royalties from the acquisition in Astatula, FL, which we completed

at the beginning of the

second quarter 2022, as well as increases in revenue

at nearly every active location.

Net Operating Income in this segment was $11,720,000, up $1,568,000 or 15.4% compared to the same period

Development Segment Results

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The Development segment is responsible for (i) seeking

out and identifying opportunistic purchases of income producing warehouse/office buildings, and (ii) developing our non-income producing

properties into income production.

out and identifying opportunistic purchases of income producing industrial and commercial buildings, and (ii) developing our non-income

producing properties into income production.

With respect to ongoing projects:

· We are the principal capital source of a residential development venture

in Prince George’s County, Maryland known as “Amber Ridge.” Of the $18.5 million in committed capital to the project,

$16.9 million in principal draws have taken place through quarter end.

Through the end of 2022, 135 of the 187 units have been sold, and

we have received $16.6 million in preferred interest and principal to date.

· Bryant Street is a mixed-use joint venture between the Company and MRP in

Washington, DC consisting of four buildings, The Coda, The Chase 1A, The Chase 1B, and one commercial building 90% leased to an Alamo

Draft House movie theater.

At quarter end, the Coda was 93.51% leased and 92.86% occupied, The Chase 1B was 86.96% leased and 87.58% occupied,

and The Chase 1A was 88.37% leased and 88.37% occupied.

quarter end, Bryant Street’s 487

residential units were 89.5% leased and 89.5% occupied.

Its commercial space was 84.2% leased and 71.4% occupied at quarter end.

· Lease-up is now underway at The Verge.

We have temporary certificates of

occupancy for all eleven floors and anticipate the final certificate of occupancy in the first quarter of 2023.

The Verge was 13.7% leased

and 9.6% occupied at year end.

Retail at this location is 85% leased.

This is our third mixed-use project in the Anacostia waterfront

submarket in Washington, DC.

· .408 Jackson is our second joint venture project in Greenville and received

its temporary certificate of occupancy in December 2022.

Leasing began in the fourth quarter of 2022 with residential units 21.6% leased

and 4.9% occupied at quarter end.

· We are the principal capital

source of a residential development venture in Prince George’s County, MD known as “Amber Ridge.” Of the $18.5 million

of committed capital to the project, $18.0 million in principal draws have taken place through quarter end.

Through the end of December

31, 2023, all 187 units have been sold, and we have received $20.2 million in preferred interest and principal to date.

· Bryant Street is a mixed-use

joint venture between the Company and MRP in Washington, DC consisting of three apartment buildings with ground floor retail and one commercial

building which is fully leased.

At quarter end, Bryant Street’s 487 residential units were 92.0% leased and 93.8% occupied.

commercial space was 96.6% leased and 82.7% occupied at quarter end.

· Lease-up is underway at The

Verge, and at quarter end, the building was 90.7% leased and 85.8% occupied inclusive of 25 units licensed to Placemakr Management for

a short-term corporate rental program.

Retail at this location is 45.2% leased.

· Grading and building permits for a 258,545 square-foot warehouse building

on Chelsea Road in Aberdeen, Maryland were submitted to the governing agencies for approval.

· In October, we received initial approval for the annexation into Aberdeen,

Maryland of our property adjacent to Cranberry Run Business Park.

In December, this annexation was finalized and rendered unappealable.

This 54-acre site will support up to 690,000 square feet of warehouse development.

· All inspections for the build to suit warehouse project totaling 101,750

square-foot, located at 1941 62 nd Street in Baltimore City, were complete except for final occupancy inspections.

· Subsequent to the end of the quarter, we financed the purchase of what will

be our next lending venture.

We are the principal capital source of a residential development venture in Aberdeen, Maryland known as “Aberdeen

Overlook.” We have committed $31.1 million in exchange for an interest rate of 10% and a preferred return of 20% after which a “waterfall”

determines the split of proceeds from sale.

Aberdeen Overlook will hold 159 townhomes, 122 single family homes, and 63 villa homes.

are currently pursuing entitlements and have a homebuilder under contract to purchase all 344 lots upon completion of development infrastructure.

Stabilized Joint Venture Segment Results

This is our third mixed-use project in the Anacostia

waterfront submarket in Washington, DC.

· .408 Jackson is our second joint

venture project in Greenville.

Leasing began in the fourth quarter of 2022 with residential units 95.2% leased and 93.4% occupied at quarter

Retail at this location is 100% leased and currently under construction and expected to open this winter.

Run, our suburban office and retail joint venture with St.

John Properties, Inc.

signed a new office lease for 3,526 square feet bringing

the office portion of the project to 87.0% leased and 78.3% occupied.

Additional retail space at this site is 38.2% leased and 22.9%

· Last summer

we broke ground on a new speculative warehouse project in Aberdeen, MD on Chelsea Road.

Site work is nearing completion with vertical

construction underway.

This Class A, 259,200 square foot building is due to be complete in the 3 rd quarter of 2024.

the principal capital source for a residential development venture in Harford County, MD known as Aberdeen Overlook.

The project includes

110 acres and 344 residential building lots.

We have committed $31.1 million to the project with $20 million currently drawn.

homebuilder is under contract to purchase all 222 townhome and 122 single family dwelling lots.

As of year-end 11 lots had been sold and

$4.5 million of preferred interest and principal has been returned to the company.

Multifamily Segment Results

Twelve months ended December 31

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Cost of operations

Operating profit (loss)

In March 2021, we reached stabilization on Phase II

(The Maren) of the development known as RiverFront on the Anacostia in Washington, DC.

As such, as of March 31, 2021, the Company consolidated

the assets (at current fair value based on appraisal), liabilities and operating results of the joint venture.

Up through the first quarter

of the prior year, accounting for The Maren was reflected in Equity in loss of joint ventures on the Consolidated Statements of Income.

Starting April 1, 2021, all the revenue and expenses are accounted for in the same manner as Dock 79 in the stabilized joint venture segment.

Operating profit

In the fourth quarter of 2022, as part of our new

partnership with Steuart Investment Company and MidAtlantic Realty Partners, we sold a 20% ownership interest in a tenancy-in-common (TIC)

of Dock 79 and The Maren for $65.3 million, $44.5 million attributable to the Company, placing a combined valuation of the two buildings

at $326.5 million.

Total revenues in this segment were $21,824,000, an

increase of $381,000 versus $21,443,000 in the same period last year.

The Maren’s revenue was $10,045,000 and Dock 79 revenues

increased $770,000 to $11,398,000.

Total operating profit in this segment was $3,220,000, an increase of $4,850,000 versus an operating

loss of $(1,630,000) in the same period last year.

Pro-rata net operating income for this segment was $9,469,000, up $1,379,000 or 17.05%

compared to the same period last year.

All of these increases over last year are primarily due to The Maren’s consolidation into

this segment in March 31, 2021.

Fourth quarter, as part of our new partnership with

SIC and MRP, we sold a 20% ownership interest in a tenancy-in-

common (IC) of Dock 79 and The Maren for $65.3 million,

$44.5 million attributable to the Company, placing a combined valuation of the two buildings at $326.5 million.

The Maren’s revenue was $10,477,000, an increase of 4.3%,

and Dock 79 revenues decreased $51,000 or .4% to $11,398,000.

Total operating profit in this segment was $3,717,000, an increase of $497,000

versus $3,220,000 in the same period last year.

Pro-rata net operating income for this segment was $8,077,000, down $1,392,000 or 14.7%

compared to the same period last year because of the sale of our 20% TIC interest in both properties to SIC, mitigated by $800,000 in

pro-rata NOI from our share of the Riverside joint venture.

At the end of December, The Maren was 93.94% leased

and 94.70% occupied.

The Maren’s average residential occupancy for calendar year 2022 was 95.69%, and 61.45% of expiring leases

renewed with an average rent increase on renewals of 8.17%.

The Maren is a joint venture between the Company and MRP and SIC, in which

FRP Holdings, Inc.

is the majority partner with 56.3% ownership.

Average residential occupancy for calendar year 2023 was 95.60%, and 53.23% of expiring leases renewed with an average

rent increase on renewals of 4.21%.

The Maren is a joint venture between the Company and MRP and SIC, in which FRP Holdings, Inc.

majority partner with 56.3% ownership.

Dock 79’s average residential occupancy for

calendar year 2023 was 94.36%, and at the end of the year, Dock 79’s residential units were 95.08% leased and 96.39% occupied.

the year, 61.40% of expiring leases renewed with a 5.91% increase on renewals.

Dock 79 is a joint venture between the Company and MRP

and SIC, in which FRP Holdings, Inc.

the year, 68.29% of expiring leases renewed with an average rent increase on renewals of 2.80%.

Dock 79 is a joint venture between the

Company and MRP and SIC, in which FRP Holdings, Inc.

is the majority partner with 52.8% ownership.

Third quarter we achieved stabilization at our Riverside

Joint Venture in Greenville South Carolina, meaning that the building had 90% occupancy for 90 days.

The building’s 200 residential

units were 98% leased with 92.5% occupancy at year end.

The joint venture was also able to achieve permanent financing in third quarter

The $32 million loan is interest only for five years with a term of eight years at a fixed rate of 4.92% with no prepayment penalty

after three years.

Riverside is a joint venture with Woodfield Development and the Company owns 40% of the venture.

Hickory Creek DST was sold and the Company received

$8.83 million from the sale on an investment of $6 million.

Prior to the sale distributions to the Company were $332,000 for the year.

During the third quarter of 2022, we achieved stabilization

at our Riverside Joint Venture in Greenville, SC.

At the end of December, the building was 95.50% leased with 94.50% occupancy.

occupancy for calendar year 2023 was 94.51% with 55.41% of expiring leases renewing with an average rental increase of 8.46%.

is a joint venture with Woodfield Development and the Company owns 40% of the venture.

Summary and Outlook

Mining royalties had its highest revenue quarter ever

providing a fitting capstone to a year that saw both royalty revenue and NOI surpass $10 million for the first time.

The extent to which

royalty revenue in 2022 eclipsed the previous year (12.9% improvement) or any year (12.7% improvement over 2020, previously the segment’s

highest revenue year) is due in large part to the purchase of the Bland property in April 2022.

However, even without the addition of

this latest royalty property, 2022 would have been the segment’s best revenue year.

It is management’s belief that the performance

of this segment this year and over the last several years (8.1% cumulative aggregate growth rate since 2017) speaks not only to the attractiveness

of the aggregates industry as an investment, but also to the quality of our assets and operating tenants.

This year, 61.45% of expiring leases at Maren renewed

with an average increase on renewals of 8.17%, and 61.40% of expiring leases renewed at Dock 79 with an average increase of 5.91%.

we could not renew an existing residential lease, we saw a year-to-date increase in rent on those “trade outs” of 7.4% at

The Maren and 12.6% at Dock 79.

With this being the first full year with The Maren in this segment, the 17% increase in NOI for this segment

is mostly attributable to an additional quarter of The Maren operating versus last year.

However, the ability to raise rents on renewals

while retaining tenants at the rate that we did both Dock 79 and The Maren played a meaningful part in increasing NOI.

As mentioned previously,

Steuart Investment Company is now a 20% partner in these assets.

We are enthusiastic about this partnership, and the combined valuation

($326.5 million) SIC placed on these assets through its investment demonstrates that our new partners have every bit as much faith in

these assets as we do.

The Asset Management segment performed well in 2022.

All of our industrial assets are 100% leased, and six of the seven buildings in service are 100% occupied.

The uptick in occupancy, particularly

at Cranberry, largely explains the increase in revenue, operating profit, and NOI in 2022, as well as the fact that this is the best year

this segment has experienced since we sold the bulk of our industrial portfolio in 2018.

Looking forward into 2023, we expect our last

two buildings at Hollander (a build to suit, and a spec building currently 100% leased but 0% occupied) to achieve occupancy sometime

in the first half of next year, which will increase our occupied square footage for industrial by 54.3% and will positively impact revenue,

operating profit, and NOI for some time.

Financially, operationally, and strategically, 2022

was a big year for the Company.

The Bland property was our first addition to the mining royalties segment since 2012 and only our second

acquisition since 1986, and it was instrumental in the segment achieving the results it did this past year.

This year, we secured permanent

financing on Riverside and completed construction and began lease-up on The Verge and .408 Jackson.

2022 saw the purchase of a new site

County Maryland capable of supporting 900,000 square

feet of industrial development and the annexation into the town of Aberdeen, Maryland of our property at 1001 Old Philadelphia Road which

begins the process of 690,000 square feet of industrial development at that site.

Each segment achieved its highest revenue, operating

profit, and NOI total since the asset sale in 2018.

However, the biggest news of 2022 came at the beginning of the fourth quarter when

we finalized the details of our agreement with SIC and MRP.

If all goes according to plan, this partnership will be developing assets

together for well over a decade and in the end will have over three million square feet of mixed-use development in DC’s Capitol

Riverfront and Buzzard Point submarkets.

With 3,000 residential units and 150,000 square feet of retail spread amongst ten distinct multifamily

projects on or adjacent to the water, this is a unique opportunity to expand upon our existing footprint in DC and end up controlling

nearly every asset visible from the south entrance to the nation’s capital.

On a macro level, the immediate future remains unclear.

On any given day, we are treated with predictions and prognostications that cover every shade of the economic color wheel.

Inflation and

rising interest rates appear to be our reality for at least the immediate future, yet so do low unemployment and job growth.

of whatever the immediate future holds, it is our belief that with the assets we have in place, the partners we have chosen, and the steps

we have made to ensure deliberate, responsible growth over the long haul, your company is on its way to building something very special.

Royalty revenue was up 17.3% over 2022 in what had

previously been the highest revenue year for this segment.

This kind of revenue growth is all the more remarkable when tons sold decreased

We are fortunate in both the locations of our mining assets, but also in the ability of our operators to push price aggressively.

State and national infrastructure spending is expected to increase in 2024 creating further demand for aggregates products.

In our Multifamily Segment, we are starting to feel

the effects of a softening DC market.

Revenues are more or less flat between Dock 79 and the Maren and did not keep pace with expenses.

Pro-rata NOI is down which is to be expected after selling 20% of our share of Dock 79 and The Maren to SIC.

But NOI for the two projects

as a whole decreased 1.3% ($13,358,000 vs $13,529,000) compared to 2022.

We should expect the market to remain slack until all the new

supply has been absorbed.

2023 was the first full calendar year of operation for our Riverside multifamily joint venture in

Greenville, SC.

Average annual occupancy (94.51%),

renewals on expiring leases (55.41%), and rent increases on renewals (8.46%) were all strong.

NOI this quarter compared to each of the

first three quarters fell off because of increased taxes as the project was annexed into the city of Greenville.

We remain excited about

the Greenville market and look forward to adding .408 Jackson to this segment when it stabilizes in early 2024.

In our Industrial and Commercial segment, occupancy

and our overall square-footage have increased since the end of 2022, leading to a 46.2% increase in NOI in 2023 compared to the previous

We are 95.6% leased and occupied on 548,785 square feet compared to 84.3% occupied on 447,035 square feet at the end of 2022.

As we have stated on a number of occasions in the

recent past, we have shifted our development focus away from multifamily in the DC market and towards industrial projects.

We are underway

on the construction of a $30 million spec warehouse project at our Chelsea site in Aberdeen, MD, which we plan to deliver in the third

quarter of 2024.

We are also in preliminary discussions on two industrial joint ventures in Florida.

We will continue to do the predevelopment

work required to prepare the first phase of our partnership with SIC and MRP for vertical construction, but that’s as far as we

will take that project until the partnership feels macroeconomic and market conditions are right.

The same is true for two other mixed-use

projects with Woodfield Development (our JV partner in Riverside and .408 Jackson) that are currently in pre-development in Greenville,

SC and Estero, FL.

We are pursuing entitlements for these joint ventures and they will be ready for vertical development by the second

half of 2024.

But we will only move forward when market conditions warrant it.

Along with our balance sheet, we consider our development

strategy and the ability to shift our focus and capital among asset classes to be our biggest strength.

We will pursue our current development

strategy aggressively, while allowing for a healthy capital cushion to protect our assets and opportunistically repurchase shares.

that end, in 2023, we repurchased 36,909 shares at an average cost of $54.19 per share.

LIQUIDITY AND CAPITAL RESOURCES

15 unchanged sentences

Financing activities

Increase in cash and cash equivalents

(Decrease) increase in cash and cash equivalents

Outstanding debt at the beginning of the period

2 unchanged sentences

operating activities in 2023 was $32,971,000 versus $22,338,000 in the same period last year.

The Gain on remeasurement of investment

in real estate partnership and related deferred income taxes were both non-cash adjustments to net income to arrive at net cash provided

by operating activities in 2021.

The increase was primarily due to increases

in operating profit and interest income while the increased joint venture losses are reflected in investing activities.

At December 31, 2023, the Company was invested in

Treasury notes valued at $128,795,000 maturing through mid-2024.

The unrealized gain on these investments of $1,000 was recorded

as part of comprehensive income and was based on the estimated market value by Wells Fargo Bank, N.A.

Net cash provided by operating activities in 2022

2 unchanged sentences

taxes were both non-cash adjustments to net income to arrive at net cash provided by operating activities in 2021.

As of December 31, 2022 the company had

deferred taxes of approximately $31 million associated with $112 million of gains on sales reinvested through Opportunity Zone investments.

These taxes are deferred until the earlier of the sale of the related investments or December 31, 2026 and 10% of gains are excluded from

tax once the investments are held five years plus an additional 5% is excluded at seven years.

Investing Activities – Net cash used

in investing activities in 2022 was $23,196,000 versus cash provided by investing activities of $66,601,000 in 2021.

The decrease was

due primarily due to increased investment in properties of $11 million, increased investments in joint ventures of $8 million and reduced

proceeds from sales of corporate bonds of $65.6 million.

In 2022 the Company invested $11 million in mining land and $11 million to pay

off debt in our BC Realty, LLC joint venture.

Net cash provided by investing activities in 2021

was $66,601,000 versus $50,527,000 in 2020.

The increase was due primarily due to a return of our preferred equity financing with interest

of $16.1 million from The Maren, $5.3 million return of capital from Amber Ridge, $24.6 million decrease in purchases of corporate bonds

due to lack of attractive investment opportunities, and $3.7 million for cash on the books of The Maren upon consolidation mostly offset

by a $15.9 million decrease on maturities and sales of our corporate bond portfolio and the $18.3 million decrease in proceeds from the

sale of assets as the prior year included the sale of the three remaining lots at our Lakeside Business Park, 1801 62 nd Street,

Gulf Hammock, and 87 acres from our Ft.

Myers property.

At December 31, 2022, the Company was invested in

2 unchanged sentences

as part of comprehensive income and was based on the estimated market value by Wells Fargo Bank, N.A.

As of December 31, 2023 the company had

deferred taxes of approximately $35 million associated with $143 million of gains on sales reinvested through Opportunity Zone investments.

These taxes are deferred until the earlier of the sale of the related investments or April 15, 2027 and 10% of gains are excluded from

tax once the investments are held five years plus an additional 5% is excluded at seven years.

Investing Activities – Net

cash used in investing activities in 2023 was $48,747,000 versus $23,196,000 in 2022.

Investments in properties was $11.2 million for

the twelve months ended December 31, 2023 and included the start of construction on a new speculative warehouse project in Aberdeen, MD

on Chelsea Road.

Investments in properties during the twelve months ended December 31, 2022 was $27.6 million which included the $11.6

million purchase of Astatula mining land, $6.7 million for 170 acres in Cecil County Maryland to accommodate 900,000 square feet of industrial

development, and the completion of the build-to-suite at 1941 62nd Street.

Investments in joint ventures was $46.7 million for

the twelve months ended December 31, 2023 and included $12 million for FRP’s share of a $20 million paydown of the loan at Bryant

Street, $19.6 million for our Aberdeen Overlook lending venture, $3.7 million for the impact of higher interest rates at Verge, and $2.5

million for predevelopment activities for our next potential apartment projects in Washington, D.C.

and in Greenville.

Investments in

joint ventures was $21.6 million for the twelve months ended December 31, 2022 and included $13.8 million for the lending ventures including

the Windlass loan and $3.6 million for our Estero joint venture.

Net cash used in investing activities in 2022 was

$23,196,000 versus cash provided by investing activities of $66,601,000 in 2021.

The decrease was due primarily due to increased investment

in properties of $11 million, increased investments in joint ventures of $8 million and reduced proceeds from sales of corporate bonds

of $65.6 million.

In 2022 the Company invested $11 million in mining land and $11 million to pay off debt in our BC Realty, LLC joint

Financing Activities – Net

cash provided by financing activities was $16,834,000 versus cash required by financing activities of $1,231,000 in the same period last

year primarily due the $27.9 million contribution for 20% ownership of Dock & Maren by our new limited partner (less $9.3 million

distributed to MRP) and prior year refinancing of Dock 79 for $1.4 million more net of debt issuance costs than the amount matured.

Net cash required by financing activities

was $1,231,000 in 2021 versus $21,838,000 in 2020 primarily due the refinancing of Dock 79 for $1.4 million more net of debt issuance

costs than the amount matured and $21.0 million lower repurchases of company stock.

Credit Facilities - On February 6,

2019, the Company entered into a First Amendment to the 2015 Credit Agreement (the "Credit Agreement") with Wells Fargo Bank,

cash used in financing activities in 2023 was $4,166,000 versus net cash provided by financing activities of $16,834,000 in the same period

last year primarily due the repurchase of Company stock, exercise of employee stock options and prior year $27.9 million contribution

for 20% ownership of Dock & Maren by our new limited partner (less $9.3 million distributed to MRP).

Net cash provided by financing activities

was $16,834,000 in 2022 versus cash used in financing activities of $1,231,000 in 2021 primarily due to the $27.9 million contribution

for 20% ownership of Dock & Maren by our new limited partner (less $9.3 million distributed to MRP) and prior year refinancing of

Dock 79 for $1.4 million more net of debt issuance costs than the amount matured.

Credit Facilities - On December 22,

2023, the Company entered into a 2023 Amended and Restated Credit Agreement (the "Credit Agreement") with Wells Fargo Bank,

(“Wells Fargo”).

The Credit Agreement modifies the Company’s prior Credit Agreement with Wells Fargo, dated January

The Credit Agreement establishes a five-year revolving credit facility with a maximum facility amount of $20 million.

rate under the Credit Agreement will be a maximum of 1.50% over Daily 1-Month LIBOR, which may be reduced quarterly to 1.25% or 1.0% over

Daily 1-Month LIBOR if the Company meets a specified ratio of consolidated total debt to consolidated total capital.

A commitment fee

of 0.25% per annum is payable quarterly on the unused portion of the commitment but the amount may be reduced to 0.20% or 0.15% if the

Company meets a specified ratio of consolidated total debt to consolidated total capital.

The credit agreement contains certain conditions

and financial covenants, including a minimum tangible net worth and dividend restriction.

As of December 31, 2022, these covenants would

have limited our ability to pay dividends to a maximum of $249 million combined.

The Credit Agreement establishes a three-year revolving credit facility with a maximum facility amount of $35 million.

rate under the Credit Agreement will be 2.25% over the Daily Simple SOFR in effect.

A commitment fee of 0.35% per annum is payable quarterly

on the unused portion of the commitment.

The credit agreement contains certain conditions and financial covenants, including a minimum

tangible net worth and dividend restriction.

As of December 31, 2023, these covenants would have limited our ability to pay dividends

to a maximum of $94 million combined.

On March 19, 2021, the Company refinanced

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prepaid subsequent to April 1, 2024, subject to yield maintenance premiums.

Either loan may be transferred to a qualified buyer as part

Either loan may be

transferred to a qualified buyer as part

of a one-time sale subject to a 60% loan to value, minimum of 7.5% debt yield and a 0.75% transfer fee.

5 unchanged sentences

Cash Requirements – The Company expended

capital of $27,615,000 during 2022 for real estate development including investments in joint ventures and the purchase of mining property.

These capital expenditures were funded from cash and investments on hand, cash generated from operations and property sales, or borrowings

under our credit facilities.

The Company expects to invest $83 million into our existing real estate holdings and partnerships as well

as new real estate assets and joint ventures during 2023, with such capital being funded from cash and investments on hand, cash generated

from operations and property sales, or borrowings

under our credit facilities.

Rising interest rates and cost inflation will require that we closely scrutinize these investments before

pulling the trigger on them.

capital of $57,910,000 during 2023 for real estate development including investments in joint ventures.

These capital expenditures were

funded from cash and investments on hand and cash generated from operations.

The Company expects to invest $87 million into our existing

real estate holdings and joint ventures as well as new real estate assets and joint ventures during 2024, with such capital being funded

from cash and investments on hand, cash generated from operations, property sales, distributions from joint ventures, or borrowings under

our credit facilities.

Non-GAAP Financial Measures.

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Income (loss) before income taxes

Gain on investment land sold

Unrealized rents

Gain on sale of real estate and other income

Interest income

Equity in (gain)/loss of Joint Venture

Loss on sale of real estate

Equity in loss of Joint Ventures

Professional fees - other

Interest Expense

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Allocated Corporate Expenses

Net Operating Income (loss)

Net Operating Income

NOI of noncontrolling interest

1 unchanged sentence

Pro-rata net operating income

Net Operating Income Reconciliation

Pro-Rata Net Operating Income Reconciliation

Twelve months ended 12/31/22 (in thousands)

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Income (loss) before income taxes

Gain on remeasurement of real estate investment

Gain on investment land sold

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Interest income

Loss on sale of land

Equity in loss of Joint Venture

Equity in (gain)/loss of Joint Venture

Interest Expense

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Pro-Rata net operating income

The following tables represent the Joint Venture and

Development pro-rata NOI by project:

Development Segment:

Bryant Street

Twelve months ended

Multifamily Segment:

Twelve months ended

Joint Venture

OFF-BALANCE SHEET ARRANGEMENTS

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senior management.

The overall collectibility of outstanding receivables and straight-lined rents is evaluated and allowances are recorded

The overall collectability of outstanding receivables and straight-lined rents is evaluated and allowances are recorded

as appropriate.

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Buildings and improvements

Depletion of sand and stone deposits is

computed on the basis of units of production in relation to estimated reserves.

Depletion expense of is computed on the

basis of units of production in relation to estimated sand and stone deposits.

The Company periodically reviews net real estate investments

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from future taxable income.

To the extent recovery is not probable, a valuation allowance is established and included as

an expense as part of our income tax provision.

No valuation allowance was recorded at December 31, 2022, as all deferred tax

assets are considered more likely than not to be realized.

Significant judgment is required in determining and assessing the impact of

complex tax laws and certain tax-related contingencies on the provision for income taxes.

As part of the calculation of the provision

for income taxes, we assess whether the benefits of our tax positions are at least more likely than not of being sustained upon audit

based on the technical merits of the tax position.

For tax positions that are more likely than not of being sustained upon audit, we accrue

the largest amount of the benefit that is more likely than not of being sustained in our consolidated financial statements.

Such accruals

require estimates and judgments, whereby actual results could vary materially from these estimates.

Further, a number of years may elapse

before a particular matter, for which an established accrual was made, is audited and resolved.

To the extent recovery is not probable, a valuation allowance is established and included as an expense as

part of our income tax provision.

No valuation allowance was recorded at December 31, 2023, as all deferred tax assets are considered

more likely than not to be realized.

Significant judgment is required in determining and assessing the impact of complex tax laws and

certain tax-related contingencies on the provision for income taxes.

As part of the calculation of the provision for income taxes, we

assess whether the benefits of our tax positions are at least more likely than not of being sustained upon audit based on the technical

merits of the tax position.

For tax positions that are more likely than not of being sustained upon audit, we accrue the largest amount

of the benefit that is more likely than not of being sustained in our consolidated financial statements.

Such accruals require estimates

and judgments, whereby actual results could vary materially from these estimates.

Further, a number of years may elapse before a particular

matter, for which an established accrual was made, is audited and resolved.

Most of the Company’s operating expenses

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agreements are based on a percentage of the sales price of the related mined items.

Minimum royalties and substantially all lease agreements

provide escalation provisions.

Substantially all lease agreements provide escalation

CONSOLIDATED STATEMENTS OF INCOME

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Total operating profit

Net investment income, including realized gains of $ 0 , $ 0 , and $ 298 , respectively

Net investment income

Interest expense

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Gain on remeasurement of investment in real estate partnership

Gain on sale of real estate

Gain on sale of real estate and other income

Income before income taxes

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Other comprehensive income (loss) net of tax:

Unrealized loss on investments, net of income tax effect of $ ( 504 ), $ ( 194 ) and $ ( 145 )

Unrealized gain (loss) on investments, net of income tax effect of $ 563 , $ ( 504 ) and $ ( 194 )

Minimum pension liability, net of income tax effect of $ ( 12 ) , $ ( 11 ) and $ ( 15 )

Comprehensive income

income attributable to noncontrolling interest

income (loss) attributable to noncontrolling interest

Comprehensive income attributable to the Company

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Accounts receivable, net

Investments available for sale at fair value

Federal and state income taxes receivable

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Stock-based compensation

Realized (gain) loss on available for sale investments

Deferred debt issuance cost write-off

Net changes in operating assets and liabilities:

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Return of capital from investments in joint ventures

Purchases of investments available for sale

Proceeds from sales of investments available for sale

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Exercise of employee stock options

Net cash provided by (used in) financing activities

Net increase in cash and cash equivalents

Net cash (used in) provided by financing activities

Net (decrease) increase in cash and cash equivalents

Cash and cash equivalents at beginning of year

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Restricted stock award

Shares purchased and cancelled

Contributions from partners

Forfeiture of restricted stock award

Contributions from partner

Reallocation of partners’ interest

Reallocation income tax expense

Distributions to partners

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Restricted stock award

Shares purchased

Forfeiture of restricted stock award

Contributions from partner

Reallocation of partners’ interest

Reallocation income tax expense

Shares purchased and cancelled

Distributions to partners

Minimum pension liability, net

Unrealized loss on investment, net

Unrealized gains on investment, net

Balance at December 31, 2023

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(i) leasing and management

of industrial and commercial properties owned by the Company (the “Asset Management Segment”), (ii) leasing and management

of industrial and commercial properties owned by the Company (the “Industrial and Commercial Segment”), (ii) leasing and management

of mining royalty land owned by the Company (the “Mining Royalty Lands Segment”), (iii) real property acquisition, entitlement,

development and construction primarily for apartment, retail, warehouse, and office (the “Development Segment”), (iv) management

of mixed-use residential/retail properties owned through our joint ventures (the “Stabilized Joint Venture Segment”).

of mixed-use residential/retail properties owned through our joint ventures (the “Multifamily Segment”).

During the 4 th

quarter of 2023, the Company renamed two of its reportable segments in order to clearly define projects within those segments.

Management segment was renamed the Industrial and Commercial segment and the Stabilized Joint Venture segment was renamed the Multifamily

There was no impact on consolidated total revenues, total cost of operations, operating profit, net earnings per share, or segment

operating results as a result of these changes.

FRP Holdings, Inc.

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The fair value of securities is determined using quoted market prices.

At December 31, 2022, no investments were

held for trading purposes or classified as held to maturity.

REVENUE AND EXPENSE RECOGNITION - Real estate

rental revenue and mining royalties are generally recognized when earned under the leases and are considered collectable.

Rental income

from leases with scheduled increases or other incentives during their term is recognized on a straight-line basis over the term of the

Reimbursements of expenses, when provided in the lease, are recognized in the period that the expenses are incurred.

At December 31, 2023 and 2022, no investments

were held for trading purposes or classified as held to maturity.

REVENUE AND EXPENSE RECOGNITION - Lease

revenues are generally recognized when earned under the leases and are considered collectable.

Rental income from leases with scheduled

increases or other incentives during their term is recognized on a straight-line basis over the term of the lease.

Reimbursements of expenses,

when provided in the lease, are recognized in the period that the expenses are incurred.

Mining royalty revenues are recognized when

the performance obligation is satisfied which is when the sand or stone mined and processed by the lessee is sold and removed from the

Our typical mining lease requires the tenant to pay the Company a monthly royalty in arrears based on the number of tons of

mined materials sold from our mining property multiplied by a percentage of the average annual sales price per ton sold from the prior

In certain locations, typically where the sand and stone deposits on the property have been depleted but the tenant still

has a need for the leased land, we collect a minimum annual rental amount but this is not the predominant component of mining royalties

As such both mining royalty revenues and minimum annual rents are recognized as revenues from contracts with customers.

royalty revenues accounts receivable were $ 465,000 , $ 618,000 and $ 388,000 at December 31, 2023, 2022 and 2021 respectively and there were

no receivables from minimum rents.

Mining royalties deferred revenue liabilities were $ 325,000 , $ 47,000 and $ 249,000 at December 31, 2023,

2022 and 2021 respectively.

Sales of real estate are recognized when

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Building and improvements

Depletion of sand and stone deposits is

computed on the basis of units of production in relation to estimated reserves.

Reserve estimates are periodically adjusted

based upon surveys.

Depletion expense is computed on the basis

of units of production in relation to estimated sand and stone deposits.

Remaining sand and stone deposit estimates

are periodically adjusted based upon surveys.

The Company recorded depreciation and depletion

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– Acquisitions of rental property, including any associated intangible assets, are measured at fair value at the date of acquisition.

Any liabilities assumed or incurred are

recorded at their fair value at the time

of acquisition.

The fair value of the acquired property is allocated between land and building (on an as-if vacant basis) based on management’s

estimate of the fair value of those components for each type of property and to tenant improvements based on the depreciated replacement

cost of the tenant improvements, which approximates their fair value.

Any liabilities assumed or incurred are recorded at their fair value at the time of acquisition.

The fair value of the acquired property

is allocated between land and building (on an as-if vacant basis) based on management’s estimate of the fair value of those components

for each type of property and to tenant improvements based on the depreciated replacement cost of the tenant improvements, which approximates

their fair value.

The fair value of the in-place leases is recorded as follows:

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When assessing an investment for an other-than-temporary decline

in value, the Company considers such factors as, the performance of the investee in relation to its own operating targets and its business

in value, the Company considers such factors as, the performance of the asset in relation to its own operating targets and its business

plan, the investee’s revenue and cost trends, as well as liquidity and cash position, and the outlook for the overall industry in

6 unchanged sentences

are recognized based on differences between financial statement and tax bases of assets and liabilities using presently enacted tax rates.

Deferred income taxes result from temporary differences between pre-tax income reported in the financial statements and taxable income.

Deferred income taxes result from temporary

differences between pre-tax income reported

in the financial statements and taxable income.

The Company recognizes liabilities for uncertain tax positions based on a two-step process.

The first step is to evaluate the tax position

for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be

sustained on audit.

The second step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be

realized upon ultimate settlement.

It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination

of the probability of various possible outcomes.

The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is

more likely than not that the position will be sustained on audit.

step is to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement.

It is inherently difficult and subjective to estimate such amounts, as the amounts rely upon the determination of the probability of various

possible outcomes.

The Company reevaluates these uncertain tax positions on a quarterly basis.

This evaluation

is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of

limitations, effectively settled issues under audit, and audit activity.

Such a change in recognition or measurement would result in the

recognition of a tax benefit or an additional charge to the tax provision.

It is the Company's policy to recognize as additional income

tax expense the items of interest paid and penalties directly related to income taxes.

This evaluation is based on factors including,

but not limited to, changes in facts or circumstances, changes in tax law and expiration of statutes of limitations, effectively settled

issues under audit, and audit activity.

Such a change in recognition or measurement would result in the recognition of a tax benefit or

an additional charge to the tax provision.

It is the Company's policy to recognize as additional income tax expense the items of interest

paid and penalties directly related to income taxes.

STOCK BASED COMPENSATION – The Company

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after the grant date.

The fair value of

each grant is estimated on the date of grant using the Black-Scholes option-pricing model.

The assumptions used in the model and current

year impact are discussed in Note 7.

The fair value of each grant is estimated on the date of grant using the Black-Scholes option-pricing model.

assumptions used in the model and current year impact are discussed in Note 7.

DEFERRED COMPENSATION PLAN - The Company

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The most critical accounting policies and estimates

include the economic useful lives of our mining reserves, property and equipment, provisions for uncollectible accounts receivable and

collectibility of unrealized rents, accounting for real estate investments, estimates of exposures related to our insurance claims plans

and environmental liabilities, and estimates for taxes.

To the extent that actual, final outcomes are different than these estimates,

or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting period will be affected.

include the economic useful lives of our estimated remaining sand and stone deposits, property and equipment, provisions for uncollectible

accounts receivable and collectibility of unrealized rents, accounting for real estate investments, estimates of exposures related to

our insurance claims plans and environmental liabilities, and estimates for taxes.

To the extent that actual, final outcomes are different

than these estimates, or that additional facts and circumstances result in a revision to these estimates, earnings during that accounting

period will be affected.

ENVIRONMENTAL - Environmental expenditures

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losses that are not included in net income, but rather are recorded directly in shareholders’ equity.

RECENTLY ISSUED ACCOUNTING STANDARDS – None.

RECENTLY ISSUED ACCOUNTING STANDARDS – In June

2016, the Financial Accounting Standards Board

(FASB) issued Accounting Standards Update (ASU) 2016

- 13, "Financial Instruments - Credit Losses," which introduced new guidance for an approach based on expected losses to estimate

credit losses on certain types of financial instruments.

This standard was effective for the Company as of January 1, 2023.

no impact on our financial statements at adoption.

Investments in Joint Ventures .

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contributions by the partners.

During the year we had two new investments in unconsolidated

joint ventures:

Estero - In August of 2022, we invested $ 3.6

million for a 16 % interest in a joint venture with Woodfield Development to purchase 46 acres in Estero, FL.

While the joint venture attempts

to rezone the property, the Company will receive a preferred return of 8 % with an option to roll its investment into equity in the vertical

development or exit at that point.

The Company’s equity interest in the joint venture is accounted for under the equity method of

accounting because of the Company’s significant influence in the development process.

Lending Ventures – In September of 2022,

we paid off and extended for up to 3 years the secured note on the property

in our BC FRP Realty, LLC joint venture advancing

a total of $ 11.3 million of the maximum commitment of $ 16 million .

This is included in our Lending Ventures investments in the tables

that follow along with our residential real estate development investments at Aberdeen and Amber Ridge.

The loan on the BC FRP Realty,

LLC joint venture statement is reclassified to equity in the Lending Ventures table.

FRP/MRP Buzzard Point Sponsor, LLC –

This partnership has been engaged in pre-development activities for phase one of property owned by Steuart Investment Company (SIC) under

a Contribution and Pre-Development Agreement between this partnership and SIC.

The following table summarizes the Company’s

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Lending ventures

DST Hickory Creek

Estero Partnership

1800 Half St.

Greenville Partnerships

Share of Profit

Total Assets of

Profit (Loss)

(Loss) of the

The Partnership

Of the Partnership

Partnership (1)

As of December 31, 2021

Brooksville Quarry, LLC

BC FRP Realty, LLC

Riverfront Holdings

Bryant Street Partnerships

Aberdeen Station Loan

DST Hickory Creek

Amber Ridge Loan

1800 Half St.

Verge Partnership

Greenville Partnerships

Riverfront Holdings II, LLC was consolidated on March 31, 2021.

Bryant Street Partnerships

includes $747,000 in 2021 for the Company’s share of preferred interest and $471,000 in 2021 for amortization of guarantee liability

related to the Bryant Street loan.

The Company is currently negotiating with MRP concerning

an ownership adjustment related to the Bryant Street stabilization and conversion of FRP preferred equity to common equity which will

be effective in 2024.

The major classes of assets, liabilities and equity

of the Company’s Investments in Joint Ventures as of December 31, 2023, are summarized in the following two tables (in thousands):

Investments in Apartment/Mixed Use Joint

Investments in Multifamily Joint

Ventures as of December 31, 2023

2 unchanged sentences

Bryant Street

1800 Half St.

Investments in real estate, net

Cash and cash equivalents

Cash and restricted cash

Unrealized rents & receivables

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Investments in real estate, net

Cash and cash equivalents

Cash and restricted cash

Unrealized rents & receivables

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of the Company’s Investments in Joint Ventures as of December 31, 2022 are summarized in the following two tables (in thousands):

Investments in Apartment/Mixed Use Joint

Investments in Multifamily Joint

Ventures as of December 31, 2022

As of December 31, 2022

Buzzard Point

Bryant Street

1800 Half St.

Holdings II, LLC

Investments in real estate, net

Cash and cash equivalents

Cash and restricted cash

Unrealized rents & receivables

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Total Liabilities and Capital

in Joint Ventures as of December 31, 2021

Investments in Joint

Ventures as of December 31, 2022

As of December 31, 2022

Investments in real estate, net

Cash and cash equivalents

Cash and restricted cash

Unrealized rents & receivables

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Total cost of operations

Total operating loss

Total operating profit/(loss)

Interest expense

Net loss before tax

The income statements of the Greenville Woodfield

Riverside Partnership are as follow (in thousands):

Riverside Partnership

The income statements of the Greenville Partnerships

are as follow (in thousands):

Company Share

Rental Revenue

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Total cost of operations

Total operating profit/(loss)

Interest expense

Net loss before tax

The income statements of the Verge Partnership are

as follows (in thousands):

Company Share

Rental Revenue

Revenue – other

Total Revenues

Cost of operations:

Depreciation and amortization

Operating expenses

Property taxes

Total cost of operations

Total operating loss

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years - $ 180,070,000 .

On February 6, 2019, the Company entered

into a First Amendment to the 2015 Credit Agreement (the “Credit Agreement”) with Wells Fargo Bank, N.A.

On December 22, 2023, the Company entered

into a 2023 Amended and Restated Credit Agreement (the “Credit Agreement”) with Wells Fargo Bank, N.A.

(“Wells Fargo”),

effective February 6, 2019.

effective December 22, 2023.

The Credit Agreement modifies the Company’s prior Credit Agreement with Wells Fargo dated January 30,

The Credit Agreement establishes a five -year revolving credit facility with a maximum facility amount of $ 20 million .

rate under the Credit Agreement will be a maximum of 1.50 % over Daily 1-Month LIBOR, which may be reduced quarterly to 1.25 % or 1.0 % over

Daily 1-Month LIBOR if the Company meets a specified ratio of consolidated debt to consolidated total capital, as

defined which excludes FRP Riverfront.

commitment fee of 0.25 % per annum is payable quarterly on the unused portion of the commitment but the amount may be reduced to 0.20 %

or 0.15 % if the Company meets a specified ratio of consolidated total debt to consolidated total capital.

The Credit Agreement contains

certain conditions, affirmative financial covenants and negative covenants.

As of December 31, 2022, there was no debt outstanding on

this revolver, $ 562,000 outstanding under letters of credit and $ 19,438,000 available for borrowing.

The letters of credit were issued

to guarantee certain obligations to state agencies related to real estate development.

Most of the letters of credit are irrevocable for

a period of one year and typically are automatically extended for additional one-year periods.

The letter of credit fee is 1 % and applicable

interest rate would have been 5.36871 % on December 31, 2022.

The credit agreement contains certain conditions and financial covenants,

including a minimum tangible net worth and dividend restriction.

As of December 31, 2022, these covenants would have limited our ability

to pay dividends to a maximum of $ 249 million combined.

The Credit Agreement establishes a three -year revolving credit facility with a maximum facility amount of $ 35 million .

rate under the Credit Agreement will be 2.25 % over the Daily Simple SOFR in effect.

A commitment fee of 0.35 % per annum is payable quarterly

on the unused portion of the commitment.

As of December 31, 2023, there was no debt outstanding on this revolver, $ 823,000 outstanding

under letters of credit and $ 34,177,000 available for borrowing.

The letters of credit were issued to guarantee certain obligations to

state agencies related to real estate development.

Most of the letters of credit are irrevocable for a period of one year and typically

are automatically extended for additional one-year periods.

The letter of credit fee is 2.25 % and applicable interest rate would have

been 7.64 % on December 31, 2023.

The credit agreement contains affirmative financial covenants and negative covenants, including a minimum

tangible net worth.

As of December 31, 2023, these covenants would have limited our ability to pay dividends to a maximum of $ 94 million

On November 17, 2017, Dock 79 borrowed a

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the consolidated financial statements.

On March 19, 2021, the Company refinanced

Dock 79 and The Maren projects pursuant to separate Loan Agreements and Deed of Trust Notes entered into with Teachers Insurance and Annuity

Association of America, LLC.

Dock 79 and The Maren borrowed principal sums of $ 92,070,000 and $ 88,000,000 respectively, in connection

with the refinancing.

The loans are separately secured by the Dock 79 and The Maren real property and improvements, bear a fixed interest

rate of 3.03 % per annum, and require monthly payments of interest only with the principal in full due April 1, 2033.

Either loan may be

prepaid subsequent to April 1, 2024, subject to yield maintenance premiums.

Either loan may be transferred to a qualified buyer as part

of a one-time sale subject to a 60% loan to value, minimum of 7.5% debt yield and a 0.75% transfer fee .

Debt cost amortization of $ 148,000 was recorded

During 2022 and 2021, the Company capitalized interest costs of $ 2,601,000 and $ 3,783,000 , respectively.

On March 19, 2021, the Company

refinanced Dock 79 and The Maren projects pursuant to separate Loan Agreements and Deed of Trust Notes entered into with Teachers

Insurance and Annuity Association of America, LLC.

Dock 79 and The Maren borrowed principal sums of $ 92,070,000

and $ 88,000,000

respectively, in connection with the refinancing.

The loans are separately secured by the Dock 79 and The Maren real property and

improvements, bear a fixed interest rate of 3.03 %

per annum, and require monthly payments of interest only with the principal in full due April 1, 2033.

loan may be prepaid subsequent to April 1, 2024, subject to yield maintenance premiums.

Either loan may be transferred to a qualified

buyer as part of a one-time sale subject to a 60% loan to value, minimum of 7.5% debt yield and a 0.75% transfer

Debt cost amortization of $ 148,000 and $ 148,000

was recorded in 2023 and 2022, respectively.

During 2023 and 2022, the Company capitalized interest costs of $1,336,000 and $2,601,000,

respectively.

The Company was in compliance with all debt

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In 2021, due to the DC legislation in place freezing rent increases as a part of

a covid relief plan, FRP was unable to increase rental rates for renewals.

This legislation was lifted in February 2022.

a covid relief plan, FRP was unable

to increase rental rates for renewals.

This legislation

was lifted in February 2022.

The Company also leases retail spaces at apartment/mixed-use

The retail leases are typically 10 -15-year leases with options to renew for another 5 years.

Retail leases at these

properties also include percentage rents which average 3-6% of annual sales for the tenant that exceed a breakpoint stipulated by each

individual lease.

All base rent

revenue is recognized on a straight-line basis.

The retail leases are typically 10 -15-year leases with options to renew for another five years.

Retail leases at

these properties also include percentage rents which average 3-6% of annual sales for the tenant that exceed a breakpoint stipulated by

each individual lease.

All base rent revenue is recognized on a straight-line basis.

Commercial & Office

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The Company leases land under long-term leases that

grant the lessee the right to mine and sell reserves from our property in exchange for royalty payments.

A typical lease has an option

to extend the lease for additional terms.

grant the lessee the right to mine and sell sand and stone deposits from our property in exchange for royalty payments.

A typical lease

has an option to extend the lease for additional terms.

At December 31, 2023, the total Carrying

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Earnings per common share:

For 2022 the Company did not have any outstanding

anti-dilutive stock options.

For 2021, 6,680 shares attributable to outstanding stock options were excluded from the calculation of diluted

earnings per share because their inclusion would have been anti-dilutive.

For 2023 and 2022 the Company did not have

any outstanding anti-dilutive stock options.

For 2021, 6,680 shares attributable to outstanding stock options were excluded from the calculation

of diluted earnings per share because their inclusion would have been anti-dilutive.

During 2023 the Company repurchased 36,909

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to employees as part of a long-term incentive plan that will vest over the next five years.

In January 2021, 8,896 shares of restricted

stock were granted to employees that will vest over the next four years.

In January 2021, 18,882 shares of restricted stock were granted

to employees as part of a long-term incentive plan that will vest over the next five years.

In March 2023, 2,272 shares of restricted

stock were granted to employees as part of a long-term incentive plan that will vest over the next five years.

The number of common shares

available for future issuance was 367,641 at December 31, 2022.

In January 2022, January 2021 and March 2020, 865 , 1,098 and 11,448 shares

of stock, respectively, were granted to employees rather than stock options as in prior years.

stock were granted to employees under the terms of the 2021 long-term incentive plan.

In January 2022, 7,448 shares of restricted stock

were granted to employees that will vest over the next four years.

In January 2022, 14,016 shares of restricted stock were granted to

employees as part of a long-term incentive plan that will vest over the next five years.

In January 2021, 8,896 shares of restricted stock

were granted to employees that will vest over the next four years.

In January 2021, 18,882 shares of restricted stock were granted to

employees as part of a long-term incentive plan that will vest over the next five years.

The number of common shares available for future

issuance was 344,077 at December 31, 2023.

In January 2023, January 2022 and January 2021 928 , 865 and 1,098 shares of stock, respectively,

were granted to employees rather than stock options as in prior years.

The Company recorded the following Stock

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Remaining Life

Non-exercisable:

$26.96 - $33.70

1 unchanged sentence

$42.13 - $45.97

$43.16 - $45.97

The aggregate intrinsic value of exercisable

1 unchanged sentence

market closing price of $ 62.88 on December 29, 2023 less exercise prices.

The unrecognized compensation cost of options

granted to FRP employees but not yet vested as of December 31, 2022 was $ 60,000 , which is expected to be recognized over a weighted-average

period of .9 years.

Gains of $ 384,000 were realized by option

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Non-vested at January 1, 2021

Time-based awards granted

Performance-based awards granted

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to the bonus depreciation on property placed in service.

Taxes in 2020 were favorably impacted by $ 1,100,000 due to a carryback of our

2020 tax net operating loss to fiscal 2016 when the federal

tax rate was 35 %.

As of December 31, 2023 the company has

deferred taxes of approximately $ 35 million associated with $ 143 million of gains on sales reinvested through Opportunity Zone investments.

These taxes are deferred until the earlier of the sale of the related investments or December 31, 2026 and 10% of gains are excluded from

tax once the investments are held five years plus an additional 5% is excluded at seven years .

These taxes are deferred until the earlier of the sale of the related investments or April 15, 2027 and 10% of gains are excluded from

tax once the investments are held five years plus an additional 5% is excluded at seven year s.

A reconciliation between the amount of tax

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income tax benefit)

Carryback of net operating loss

Provision for income taxes

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and penalties, and adjustments to prior year estimates.

The effective state income tax rate in 2022 and 2023 was favorably impacted both

by apportioned interest income in Florida and taxable losses in states with higher income tax rates.

types of temporary differences and their related tax effects that give rise to deferred tax assets and deferred tax liabilities are

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Unrealized rents

Prepaid expenses

Prepaid expenses and other

Gross deferred tax liabilities

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open for audit is 2018.

Our effective income tax expense may vary, possibly materially, due to projected effective state tax rates.

Our effective income tax expense may vary,

possibly materially, due to projected effective

state tax rates.

Employee Benefits .

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The Company is reporting its financial performance

based on four reportable segments, Asset Management, Mining Royalty Lands, Development and Stabilized Joint Venture, as described below.

The Asset Management Segment owns, leases and manages

in-service commercial properties wholly owned by the Company.

Currently this includes seven warehouses in two business parks, an office

building partially occupied by the Company, and two ground leases.

based on four reportable segments, Industrial and Commercial (previously named Asset Management), Mining Royalty Lands, Development, and

Multifamily (previously named Stabilized Joint Venture), as described below.

The Industrial and Commercial Segment owns, leases

and manages in-service commercial properties wholly owned by the Company.

Currently this includes nine warehouses in two business parks,

an office building partially occupied by the Company, and two ground leases.

Our Mining Royalty Lands Segment owns several properties

comprising approximately 16,650 acres currently under lease for mining rents or royalties (this does not include the 4,280 acres owned

in our Brooksville joint venture with Vulcan Materials).

Other than one location in Virginia, all of these properties are located

in Florida and Georgia.

totaling approximately 16,650 acres currently under lease for mining rents or royalties (this does not include the 4,280 acres owned in

our Brooksville joint venture with Vulcan Materials).

Other than one location in Virginia, all of these properties are located in

Florida and Georgia.

Through our Development Segment, we own

and are continuously assessing for their highest and best use for several parcels of land that are in various stages of development.

overall strategy in this segment is to convert all of our non-income producing lands into income production through (i) an orderly process

of constructing new buildings for us to own and operate or (ii) a sale to, or joint venture with, third parties.

and are continuously assessing the highest and best use of several parcels of land that are in various stages of development.

strategy in this segment is to convert all of our non-income producing lands into income production through (i) an orderly process of

constructing new buildings for us to own and operate or (ii) a sale to, or joint venture with, third parties.

Additionally, our Development

segment will form joint ventures on new developments of land not previously owned by the Company.

The Stabilized Joint Venture segment includes

joint ventures which own, lease and manage buildings that have met our initial lease-up criteria.

Two of our joint ventures in the segment,

Riverfront Investment Partners I, LLC (“Dock 79”) and Riverfront Investment Partners II, LLC (“The Maren”) are

consolidated.

The Multifamily Segment includes joint ventures

which own, lease and manage buildings that have met our initial lease-up criteria.

Two of our joint ventures in the segment, Riverfront

Investment Partners I, LLC (“Dock 79”) and Riverfront Investment Partners II, LLC (“The Maren”) are consolidated.

The Maren was consolidated effective March 31, 2021 and prior periods are still reflected under the equity method.

The ownership

of Dock 79 and The Maren (commencing March, 2021) attributable to our partner MidAtlantic Realty Partners, LLC (MRP) is reflected on our

consolidated balance sheet as a noncontrolling interest.

Such noncontrolling interests are reported on the Consolidated Balance Sheets

within equity but separately from shareholders' equity.

On the Consolidated Statements of Income, all of the revenues and expenses from

Dock 79 are reported in net income, including both the amounts attributable to the Company and the noncontrolling interest.

is reflected in Equity in loss of joint ventures on the Consolidated Statements of Income for the periods up to March 31, 2021 but is

reflected like Dock 79 for periods commencing April 1, 2021.

The amounts of consolidated net income attributable to the noncontrolling

interest is clearly identified on the

accompanying Consolidated Statements of

The ownership of Dock

79 and The Maren attributable to our partners are reflected on our consolidated balance sheet as a noncontrolling interest.

Such noncontrolling

interests are reported on the Consolidated Balance Sheets within equity but separately from shareholders' equity.

On the Consolidated

Statements of Income, all of the revenues and expenses from Dock 79 are reported in net income, including both the amounts attributable

to the Company and the noncontrolling interest.

The Maren is reflected in Equity in loss of joint ventures on the Consolidated Statements

of Income for the periods up to March 31, 2021 but is reflected like Dock 79 for periods commencing April 1, 2021.

The amounts of consolidated

net income attributable to the noncontrolling interest is clearly identified on the accompanying Consolidated Statements of Income.

Operating results and certain other financial

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Years Ended December 31,

Asset management

Industrial and Commercial

Mining royalty lands

Stabilized Joint Venture

Operating profit:

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Operating profit before corporate expenses

Asset management

Industrial and Commercial

Operating profit before corporate expenses

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Operating profit before corporate expenses

Stabilized Joint Venture

Operating profit before corporate expenses

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Corporate expenses

Allocated to asset management

Allocated to Industrial and Commercial

Corporate expenses

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Corporate expenses

Allocated to Stabilized Joint Venture

Allocated to Multifamily

Corporate expenses

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Depreciation, depletion and amortization

Asset management

Industrial and Commercial

Depreciation, depletion and amortization

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Depreciation, depletion and amortization

Stabilized Joint Venture

Depreciation, depletion and amortization

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Capital expenditures

Asset management

Industrial and Commercial

Capital expenditures

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Capital expenditures

Stabilized Joint Venture

Capital expenditures

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Identifiable net assets at end of period:

Asset management

Industrial and Commercial

Mining royalty lands

Stabilized Joint Venture

Investments available for sale

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to the overall fair value measurement.

At December 31, 2022, the Company was invested U.S.

Treasury notes valued at $ 161,585,000 maturing in late 2023.

The unrealized loss on these investments of $ 1,903,000 was recorded as part

of comprehensive income and was based on the estimated market value by Wells Fargo Bank, N.A.

At December 31, 2023, the Company was invested in

Treasury notes valued at $ 128,795,000 maturing through mid-2024.

The unrealized gain on these investments of $ 1,000 was recorded

as part of comprehensive income and was based on the estimated market value by Wells Fargo Bank, N.A.

At December 31, 2023 and 2022, the carrying

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estate development.

The Company and MRP guaranteed $ 26 million of the

construction loan on the Bryant Street Partnerships in exchange for a 1 % lower interest rate.

The Company and MRP have a side agreement

limiting the Company’s guarantee to its proportionate ownership.

The value of the guarantee was calculated at $ 1.9 million based

on the present value of the 1 % interest savings over the anticipated 48 -month term.

This amount is included as part of the Company’s

investment basis and is amortized to expense over the 48 months.

The Company will evaluate the guarantee liability based upon the success

of the project and assuming no payments are made under the guarantee the Company will have a gain for $ 1.9 million when the loan is paid

Borrower may prepay a portion of the unpaid principal to satisfy such tests.

The Company and MRP previously guaranteed

$ 26 million of the construction loan on the Bryant Street Partnerships in exchange for a 1 % lower interest rate.

The value of the guarantee

was calculated at $ 1.9 million based on the present value of the 1% interest savings over the anticipated 48-month term.

This amount is

included as part of the Company’s investment basis and was amortized to expense over the 48 months.

In December 2023 this loan was

paid in full with proceeds from another lender and contributions by the Company and MRP.

The Company recorded a gain of $ 1.9 million in

December 2023 as the guarantee liability was relieved.

The Company and MidAtlantic Realty Partners (MRP)

provided a guaranty for the interest carry cost of $ 110 million loan on the Bryant Street Partnerships issued in December 2023.

and MRP have a side agreement limiting the Company’s guarantee to its proportionate ownership.

The value of the guarantee was calculated

at $ 1.5 million based on

the present value of the our assumption of 0.8 %

interest savings over the anticipated 36 -month term.

This amount is included as part of the Company’s investment basis and is amortized

to expense over the 36 months.

The Company will evaluate the guarantee liability based upon the success of the project and assuming no

payments are made under the guarantee, the Company will have a gain for $ 1.5 million when the loan is paid in full.

Commitments .

The Company, at December 31, 2023, had entered

into various contracts to develop and maintain real estate with remaining commitments totaling $ 2,133,000 .

into various contracts to develop and maintain real estate with remaining commitments totaling $ 16.8 million .

As of December 31, 2023, we had additional

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times, such amounts may exceed FDIC limits.

Unusual or Infrequent Items Impacting Quarterly Results .

Unusual or Infrequent Items Impacting Results .

On March 31, 2021, the Company consolidated the assets

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of investment in real estate partnership of $ 51,139,000 of which $ 13,965,000 was attributed to noncontrolling interest.

Provision for income taxes in the fourth quarter of

2020 was favorably impacted by $ 1,100,000 due to a carryback of our 2020 tax net operating loss to fiscal 2016 when the federal tax rate

Intangible Assets .

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Contributions from partner .

On November 4, 2022 the Company sold a 20 %

ownership interest in tenancy-in-common (TIC) of Dock 79 and The Maren for $ 65.3 million to a new partner Steuart Investment Company

Net of the mortgage assumption of $ 36.0 million and the Company’s share of transfer taxes and other transactions costs

of $ 1.4 million the net contribution was $ 27.9 million .

Of this amount $ 9.3 million was distributed to MRP and $ 18.6 million to the

A reallocation of partners’ interest of $ 7.7 million was recorded to Capital in excess of par value for the

difference between the $ 18.6 million consideration received by the company and the net book value of the Company’s share of

Deferred income tax expense of $ 2.1 million was recorded to Capital in excess of par value on the Company’s

reallocation.

The Company continues to consolidate both properties because of continued control over major decisions for both

On November 4, 2022 the Company sold a 20 % ownership

interest in tenancy-in-common (TIC) of Dock 79 and The Maren for $ 65.3 million to a new partner Steuart Investment Company (SIC).

of the mortgage assumption of $ 36.0 million and the Company’s share of transfer taxes and other transactions costs of $ 1.4 million

the net contribution was $ 27.9 million .

Of this amount $ 9.3 million was distributed to MRP and $ 18.6 million to the Company.

A reallocation

of partners’ interest of $ 7.7 million was recorded to Capital in excess of par value for the difference between the $ 18.6 million

consideration received by the company and the net book value of the Company’s share of assets sold.

Deferred income tax expense

of $ 2.1 million was recorded to Capital in excess of par value on the Company’s reallocation.

The Company continues to consolidate

both properties because of continued control over major decisions for both properties.

Subsequent Events .

Subsequent to the end of the year, on March 6, 2024,

FRP Holdings, Inc announced that it intends to effect a forward stock split of its common stock at a ratio of 2 post-split shares for

every 1 pre-split share.

The record date for the split will be April 1, 2024, and the payment date is April 12, 2024.

The stock split

will increase the number of issued shares of the Company's common stock from 9,500,300 shares to 19,000,600 shares.

The following table shows the Historical earnings

per share and the pro forma earnings per share assuming the stock split was effective:

Years Ended December 31,

Historical Earnings per common share:

Net Income attributable to the Company -

Pro Forma Earnings per common share (unaudited):

Net Income attributable to the Company -

Report of Management

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Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheets of FRP Holdings, Inc.

(the “Company”) as of December 31, 2022 and 2021, and the related consolidated

statements of income, comprehensive income, shareholders’ equity, and cash flows for each of the years in the three-year

period ended December 31, 2022, and the related notes (collectively referred to as the “consolidated financial

statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial

position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the years

in the three-year period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States

We have audited the accompanying consolidated balance

sheets of FRP Holdings, Inc.

(the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of

income, comprehensive income, shareholders’ equity, and cash flows for each of the years in the three-year period ended December

31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the

consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023

and 2022, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2023,

in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

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financial statements, the Company enters into real estate investments and performs an assessment as to which method of accounting is appropriate,

whether the proper accounting is to

determine whether to use the cost or equity method

to account for an investment or whether to consolidate such investment.

Note 2 to the consolidated financial statements provides a detail

of unconsolidated real estate investments.

whether the proper accounting is to determine whether to use the cost or equity method to account for an investment or whether to consolidate

such investment.

Note 2 to the consolidated financial statements provides a detail of unconsolidated real estate investments.

Application and auditing of the accounting treatment

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Chief Executive Officer of the Company

Commander III (2)(3)

Retired Partner

Foley & Lardner

deVilliers, Jr.

President of the Company

McAfee (2)(3)(4)

Founding Partner, Driver McAfee Hawthorne

& Diebenow, PLLC

Surface (2)(3)(4)

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Annual Meeting

Shareholders are cordially invited to

attend the 2023 annual meeting of shareholders on Wednesday, May 10, 2023 at 11:00 a.m., Eastern Daylight Time.

meeting will be held virtually.

To participate in the annual meeting, go to www.frpdev.com, click the Investors tab, and then click

the link titled “2023 Annual Shareholders Meeting”.

Shareholders are cordially invited to attend

the 2024 annual meeting of shareholders on Wednesday, May 8, 2024 at 11:00 a.m., Eastern Daylight Time.

This year’s meeting will

be held virtually.

To participate in the annual meeting, go to www.frpdev.com , click the Investors tab, and then click the link

titled “2024 Annual Shareholders Meeting”.

Transfer Agent

American Stock Transfer & Trust Company

59 Maiden Lane

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures