Critical Accounting Policies and Estimates.
Securities and Exchange Commission Financial Reporting Release No. 60 requires all companies to include a discussion of critical accounting policies and methods used in the preparation of the financial statements. Note 1 of the consolidated financial statements, included elsewhere on this Annual Report of Form 10-KSB, includes a summary of the significant accounting policies and methods used in the preparation of the Company's consolidated financial statements. The Company believes the following critical accounting policies affect the significant judgments and estimates used in the preparation of the Company's financial statements:

Marketable Securities. Consistent with the Company's overall investment objectives and activities, management has classified its entire marketable securities portfolio as trading. As a result, all unrealized gains and losses on the Company's investment portfolio are included in the Consolidated Statement of Comprehensive Income. Our investments in trading equity and debt marketable securities are valued based on quoted market prices. Marketable securities are subject to fluctuations in value in accordance with market conditions.

Other Investments. The Company's other investments consist primarily of nominal equity interests in various privately-held entities, including limited partnerships whose purpose is to invest venture capital funds in growth-oriented enterprises. The Company does not have significant influence over any investee and the Company's investment represents less than 3% of the investee's ownership. None of these investments meet the criteria of accounting under the equity method and are carried at cost less distributions and other than temporary unrealized losses. These investments do not have available quoted market prices, so we must rely on valuations and related reports and information provided to us by those entities. These valuations are by their nature subject to estimates which could change significantly from period to period. The Company regularly reviews the underlying assets in its other investment portfolio for events, including but not limited to bankruptcies, closures and declines in estimated fair value, that may indicate the investment has suffered an other-than-temporary decline in value. When a decline is deemed other-than-temporary, we permanently reduce the cost basis component of the investments. As such, any recoveries in the value of the investments will not be recognized until the investments are sold.

Our estimates of each of these items historically have been adequate. However, due to uncertainties inherent in the estimation process, it is reasonably possible that the actual resolution of any of these items could vary significantly from the estimate and, accordingly, there can be no assurance that the estimates may not materially change in the near term.

Real Estate. Land, buildings and improvements, furniture, fixtures and equipment are recorded at cost. Tenant improvements, which are included in buildings and improvements, are also stated at cost. Expenditures for ordinary maintenance and repairs are expensed to operations as they are incurred. Renovations and/or replacements, which improve or extend the life of the asset are capitalized and depreciated over their estimated useful lives.

Depreciation is computed utilizing the straight-line method over the estimated useful lives of ten to forty years for buildings and improvements and five to ten years for furniture, fixtures and equipment. Tenant improvements are amortized on a straight-line basis over the term of the related leases.

The Company is required to make subjective assessments as to the useful lives of its properties for purposes of determining the amount of depreciation to reflect on an annual basis with respect to those properties. These assessments have a direct impact on the Company's net income. Should the Company lengthen the expected useful life of a particular asset, it would be depreciated over more years, and result in less depreciation expense and higher annual net income.

Assessment by the Company of certain other lease related costs must be made when the Company has a reason to believe that the tenant will not be able to execute under the term of the lease as originally expected.

The Company periodically reviews the carrying value of certain of its properties and long-lived assets in relation to historical results, current business conditions and trends to identify potential situations in which the carrying value of assets may not be recoverable. If such reviews indicate that the carrying value of such assets may not be recoverable, the Company would estimate the undiscounted sum of the expected future cash flows of such assets or analyze the fair value of the asset, to determine if such sum or fair value is less than the carrying value of such assets to ascertain if a permanent impairment exists. If a permanent impairment exists, the Company would determine the fair value by using quoted market prices, if available, for such assets, or if quoted market prices are not available, the Company would discount the expected future cash flows of such assets and would adjust the carrying value of the asset to fair value. Judgments as to impairments and assumptions used in projecting future cash flow are inherently imprecise.

Results of Operations:
For the years ended December 31, 2007 and 2006 (as restated), the Company reported a net loss of approximately $443,000 (or $.43 per share) and $544,000 (or $.53 per share), respectively.

Revenues:
Effective for the year ended December 31, 2007 the Company has reported net gain from investments in marketable securities, net income from other investments and interest, dividends and other income as other income instead of revenues as previously reported. The 2006 income statement has also been reclassified in the same manner.

Total revenues for the year ended December 31, 2007 as compared with that of 2006 increased by approximately $282,000 (or 3%). This increase was due to increased real estate rentals and increase revenues from spa operations.

Real estate and related revenue:
Real estate rentals and related revenue increased by approximately $140,000 (or 10%) for the year ended December 31, 2007 as compared with 2006. This increase was the result of increased rental income from Grove Isle of approximately $85,000 due to increases in base rent from inflation adjustment as provided in the lease and approximately $54,000 in increase rental income from the Monty's office/retail space. As of December 31, 2007 approximately 18,000 square feet of office/retail space is leased and expected to generate approximately $411,000 total rent and related revenue on annualized basis.

Monty's restaurant operations:
Summarized statement of income of the Monty's restaurant operations for the years ended December 31, 2007 and 2006 is presented below (Note: the information below represents 100% of the restaurant operations while the Company's ownership percentage in these operations is 50%):

Summarized statement of Year ended Percentage Year ended Percentage income of Monty's restaurant December 31, 2007 of sales December 31, 2006 of sales Revenues:

Food and Beverage Sales             $6,344,000       100%        $6,369,000       100%

         Expenses:
Cost of food and beverage                           27.1%                        28.4%
sold                                 1,720,000                    1,810,000
Labor, entertainment and                            22.9%                        20.1%
related costs                        1,451,000                    1,303,000
Other food and beverage                              3.9%                         3.9%
related costs                          246,000                      249,000
Other operating costs                  555,000       8.7%           521,000       8.2%
Insurance                              332,000       5.2%           276,000       4.3%
Management fees                        325,000       5.1%           325,000       5.1%
Utilities                              209,000       3.3%           212,000       3.3%
Rent (as allocated)                    651,000      10.3%           655,000      10.3%
Total Expenses                       5,489,000      86.5%         5,351,000      84.0%

   Income before loss on
    disposal of assets,
 depreciation and minority
          interest                    $855,000      13.5%        $1,018,000      16.0%

The Monty's restaurant is subject to seasonal fluctuations in sales. January through May sales typically account for over 50% of annual sales.

Sales in 2007 were consistent with 2006.

Expenses were slightly higher in 2007 primarily due to increase labor costs due to the change in management of the restaurant which resulted in the hiring of a general manager and more assistant managers. Also, insurance cost increased approximately $56,000 over that of 2006 as a result of increased renewal premiums.

Grove Isle and Monty's marina operations:
The Grove Isle marina operates for the benefit of the slip owners and maintains all aspects of the marina in exchange for an annual maintenance fee from the slip owners to cover operational expenses. As of December 31, 2007 and 2006, 79 of the 85 slips were owned by unrelated individuals or entities, the remaining 6 slips are owned by the Company. The Company rents the unsold slips to boat owners on a short term basis.

The Monty's marina consists of 132 boat slips of which approximately 30 slips are leased on a long term basis (more than one year) to tenants of the upland property, and the others are available for rent to the public.

Total marina revenues increased by approximately $47,000 (or 3%) for the year ended December 31, 2007 as compared with 2006 primarily as a result of increase dockage rates. The decrease in utilities expense was the result of a new policy (since August 2006) which requires all marina tenants to reimburse the Company for electrical usage.

Summarized and combined statements of income from marina operations:
(The Company owns 50% of the Monty's marina and 95% of the Grove Isle marina)

                                                      Combined
                               Grove Isle  Monty's     marina        Combined
                                 Marina     Marina   operations  marina operations
Summarized statement of income Year ended Year ended Year ended     Year ended
          of marina             December   December   December       December
          operations            31, 2007   31, 2007   31, 2007       31, 2006
          Revenues:
Dockage fees and related                  $1,244,000
income                            $92,000             $1,336,000        $1,317,000
Grove Isle marina slip owners                      -
dues                              383,000                383,000           354,000
Total marina revenues             475,000  1,244,000   1,719,000         1,671,000

          Expenses:
Labor and related costs           232,000          -     232,000           226,000
Insurance                          68,000    133,000     201,000           178,000
Management fees                    36,000     37,000      73,000            63,000
Utilities                          24,000     36,000      60,000           156,000
Bay bottom lease                   37,000    200,000     237,000           232,000
Repairs and maintenance            86,000     68,000     154,000           125,000
Other                              29,000     75,000     104,000            80,000
Total Expenses                    512,000    549,000   1,061,000         1,060,000

   Income before interest,
       depreciation and
      minority interest         ($37,000)   $695,000    $658,000          $611,000

Grove Isle spa operations:
Spa revenues increased by $120,000 (or 19%), primarily in increased massage revenue. This was partially the result of more exposure to guests of the Grove Isle resort which has increased promotions of hotel accommodations offering spa packages.

Spa expenses increased by $167,000 (or 25%), primarily due to increased labor costs as a result of more full time staff on hand to improve service consistency and better serve customers. Also, other operating costs increased as a result of increased contract services and increased advertising and promotional expenses.

Below is a summarized income statement for these operations for the year ended December 31, 2007 and 2006. The Company owns 50% of the Grove Isle Spa with the other 50% owned by an affiliate of the Noble House Resorts, the tenant operator of the Grove Isle Resort.

                               For the     For the
       Grove Isle Spa        year ended  year ended
  Summarized statement of     December    December
           income             31, 2007    31, 2006
         Revenues:
Services provided               $688,000    $568,000
Membership and other              53,000      53,000
Total spa revenues               741,000     621,000

         Expenses:
Cost of sales (commissions
and other)                       188,000     192,000
Salaries, wages and related      296,000     180,000
Other operating costs            259,000     196,000
Management and
administrative fees               45,000      34,000
Pre-opening and start up
costs                                  -      20,000
Other                             44,000      43,000
Total Expenses                   832,000     665,000

   Loss before interest,
   depreciation, minority
 interest and income taxes     ($91,000)   ($44,000)

Expenses:
Total expenses for the year ended December 31, 2007 as compared to that of 2006 increased by approximately $74,000 (or less than 1%). Food and beverage costs are solely from the Monty's restaurant operations. Spa expenses are solely from the Grove Isle spa operations. Marina expenses are from both the Monty's and Grove Isle marinas. Summarized income statements and discussion of significant changes in expenses for each of these operations are presented above.

In 2006 upon substantial completion of renovations to the Monty's property the Company recognized a non-recurring loss of $624,000 on the abandonment of certain fixed assets which were replaced during construction.

Operating expenses of rental and other properties for the year ended December 31, 2007 increased by approximately $119,000 (or 18%) as compared with that of 2006. This increase was primarily the result of increased insurance costs of the Monty's property of approximately $54,000 and increased repairs and maintenance of the bridge to Grove Isle of approximately $70,000.

Depreciation and amortization expense increased by approximately $141,000 (or 12%) primarily due to the substantial completion of improvements at the Monty's rental spaces and increased purchases of fixed assets and improvements at the Monty's restaurant in 2007.

Interest expense decreased by approximately $77,000 (or 5%) for year ended December 31, 2007 as compared to 2006. This was due to decreased interest expense from margin borrowings relating to the marketable securities portfolio of $50,000 and decreased interest paid on the Monty's property loan as a result of principal reductions of $23,000.

Professional fees increased by approximately $28,000 (or 9%) for the year ended December 31, 2007 as compared to 2006. This increase was primarily due to increased restaurant consulting and legal fees.

Other Income:

Net gain from investments in marketable securities:
Net gain from investments in marketable securities, including marketable
securities distributed by partnerships in which the Company owns minority
positions, for the years ended December 31, 2007 and 2006, is as follows:

                      Description                          2007      2006
Net realized gain from sales of marketable securities    $249,000  $223,000
Unrealized net (loss) gain in marketable securities      (135,000) 248,000

Net realized gain from sales of marketable securities consisted of approximately $516,000 of gains net of $267,000 of losses for the year ended December 31, 2007. The comparable amounts in fiscal year 2006 were gains of approximately $436,000 net of $213,000 of losses.

Approximately $140,000 and $64,000 of net realized gains in fiscal years 2007 and 2006, respectively, were recognized from the sale of stock distributions from the Company's investments in privately held partnerships included in other investments.

Consistent with the Company's overall current investment objectives and activities, the entire marketable securities portfolio is classified as trading (versus available for sale, as defined by generally accepted accounting principles). Unrealized gains or losses from marketable securities are recorded as other income in the consolidated statements of comprehensive income.

Investment gains and losses on marketable securities may fluctuate significantly from period to period in the future and could have a significant impact on the Company's net earnings. However, the amount of investment gains or losses on marketable securities for any given period has no predictive value and variations in amount from period to period have no practical analytical value.

Investments in marketable securities give rise to exposure resulting from the volatility of capital markets. The Company believes its risk to be mitigated by the diversity of its marketable securities portfolio.

Net gain from other investments is summarized below:

                                       2006 (as
                             2007      restated)
Venture capital funds -
diversified businesses
(a)                          $581,000    $404,000
Restaurant development &
operation (b) (2006
restated)                   (150,000)   (383,000)
Real estate and related
(c)                           (6,000)     148,000
Venture capital funds -
technology &
communications (d)          (125,000)      50,000
Income from investment
in 49% owned affiliate
(e)                           107,000      91,000
Other (f)                     320,000       6,000
         Totals              $727,000    $316,000

(a) In 2007 and 2006 amounts consist primarily of gains of approximately $438,000 and $226,000, respectively, on distributions from the Company's investment in two limited partnerships which own interests in various diversified businesses, primarily in the manufacturing and production related sectors. Also in 2007 and 2006 gains of approximately $143,000 and $178,000, respectively were recognized on distributions from a private capital fund that invests in equities, debt or debt like securities of distressed companies. The Company's ownership percentage in all of these investments is less than 1% of the total ownership and in each case gains are only recognized after the total investment cost has been recovered.

(b) In September 2007, the Company elected to write off $150,000 of its investment in a restaurant development and franchise entity which is being restructured and which, in the Company's opinion, will result in an other-than-temporary decline in value. The Company had invested $200,000 in this entity, representing approximately 1% of its equity. This franchise entity was restructured in a reverse merger in which the Company invested an additional $75,000 in December 2007. In December 2006 the Company elected to write off its entire 10% equity interest in a restaurant located in Key West, Florida and recognized a loss of $383,000 (as restated - Reference is made to Form 8-K filed February 12, 2008) . The restaurant was sold in February 2007 and proceeds from the sale were not sufficient for the Company to recover its investment.

(c) In December 2007 the Company elected to write off a $200,000 investment in a real estate project located in Jacksonville, Florida as a result of declining market conditions relating to projects of this sort (i.e. 256 unit apartment community with highly leveraged financing). The Company had made its initial investment in this project in February 2006 and its investment represented just 1.2% of the total project. As an offset to this loss the Company received distributions from other real estate funds in excess of their carrying value and recognized gains of approximately $194,000. The 2006 gain amount of $148,000 primarily consisted of gains on the distribution of proceeds from the Company's investment in a real estate fund.

(d) In December 2007 the Company elected to write down its investment in a technology partnership by $164,000 as a result of an other than temporary decline in value based on the general manager's year end valuation of the partnerships investments. In January 2007 the Company received a final cash distribution of $48,000 from its investment in a technology partnership and recognized the amount as a gain. The 2006 gain of $50,000 was also from a distribution from a technology partnership.

(e) This gain represents income from the Company's 49% owned affiliate, T.G.I.F. Texas, Inc. The increase from the prior year is primarily as a result of increased interest income. In December 2007 T.G.I.F. Texas declared and paid a cash dividend of $.05 per share and the Company received approximately $140,000 which was recorded as reduction in the investment carrying value as required under the equity method of accounting for investments.

(f) In April 2007, the Company received approximately $449,000 of cash and stock from an investment in a privately-held bank which was purchased by a publicly-held bank. The Company realized a gain of approximately $299,000 on this transaction (included in table above under "Others").

Net gain or loss from other investments may fluctuate significantly from period to period in the future and could have a significant impact on the Company's net earnings. However, the amount of investment gain or loss from other investments for any given period has no predictive value and variations in amount from period to period have no practical analytical value.

Interest, dividend and other income decreased by approximately $67,000 or 11% primarily as a result of less interest received from notes and other receivables largely as a result of the paid off $1 million note receivable from Monty's Key West in February 2007.

Gain on sales of properties, net
There were no sales of real estate for the year ended December 31, 2007. Net gain on sales of real estate for the year ended December 31, 2006 consisted of the sale of the remaining undeveloped land in Houston, Texas in which the Company recognized a gain of $257,000 net of adviser's incentive fee of $28,000.

(Benefit from) provision for income taxes:
(Benefit from) provision for income taxes for the years ended December 31, 2007 and 2006 was ($157,000) and $12,000, respectively.

The Company follows the liability method of accounting for income taxes. Under this method, deferred tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between the carrying amount and the tax basis of assets and liabilities at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. As a result of timing differences associated with the carrying value of other investments and depreciable assets and the future benefit of a net operating loss, as of December 31, 2007 and 2006, the Company has recorded a net deferred tax asset of $233,000 and $76,000, respectively. A valuation allowance against deferred tax asset has not been established as management believes it is more likely than not, based on the Company's previous history and expectation of future taxable income before expiration, that these assets will be realized.

Effect of Inflation.
Inflation affects the costs of operating and maintaining the Company's investments. In addition, rentals under certain leases are based in part on the lessee's sales and tend to increase with inflation, and certain leases provide for periodic adjustments according to changes in predetermined price indices.

Liquidity, Capital Expenditure Requirements and Capital Resources. The Company's material commitments primarily consist of maturities of debt obligations of approximately $4.3 million in 2008 and contributions committed to other investments of approximately $1.8 million due upon demand. The funds necessary to meet these obligations are expected from the proceeds from the sales of properties or investments, bank construction loan, refinancing of existing bank loans, distributions from investments and available cash. Included in the maturing debt obligations for 2008 is a note payable to the Company's 49% owned affiliate, T.G.I.F. Texas, Inc. ("TGIF") ( Reference is made to Item 12 Certain Relationships and Related Transactions) of approximately $3.7 million. This amount is due on demand. The obligation due to TGIF will be paid with funds available from distributions from its investment in TGIF and from available cash.

A summary of the Company's contractual cash obligations at December 31, 2007 is as follows:

                                Payments Due by Period
Contractual              Less than
Obligations     Total      1 year   1 - 3 years 4 - 5 years After 5 years
Mortgages
and notes
payable      $19,982,000 $4,345,000  $1,510,000  $1,723,000   $12,404,000
Other
investments
commitments
(a)            1,760,000  1,760,000          --          --            --
   Total     $21,742,000 $6,105,000  $1,510,000  $1,723,000   $12,404,000

(a) The timing of amounts due under commitments for other investments is determined by the managing partners of the individual investments. These amounts are reflected as due in less than one year although the actual funding may not be required until some time in the future.

Material Changes in Operating, Investing and Financing Cash Flows. The Company's cash flows are generated primarily from its real estate activities, sales of investment securities, distributions from other investments and borrowings. For the year ended December 31, 2007 the Company's net cash from operating activities was approximately $1,012,000. This included increase in other assets and other receivables of $346,000 and a net loss of $443,000. The Company believes that there will be sufficient cash flows in the next year to meet its operating requirements.

For the year ended December 31, 2007, the net cash provided by investing activities was approximately $1.57 million. This included cash provided from collections of note and other receivables of $1.2 million and distributions from . . .