RESULTS OF OPERATIONS
For the three months ended September 30, 2012 and 2011, the Company reported net losses of approximately $94,000 ($.09 per share) and $230,000 ($.23 per share), respectively. For the nine months ended September 30, 2012 and 2011, the Company reported net income of approximately $139,000 ($.14 per share) and a net loss of $618,000 ($.61 per share), respectively.

Total revenues for the nine months ended September 30, 2012 as compared with the same period in 2011, increased by approximately $142,000 or 2%. Total revenues for the three months ended September 30, 2012 as compared with the same period in 2011 remained essentially unchanged.

Total expenses for the nine months ended September 30, 2012, as compared with the same period in 2011, decreased by approximately $401,000 or 5%. Total expenses for the three months ended September 30, 2012, as compared with the same period in 2011, decreased by approximately $210,000 or 8%.

REVENUES
Rentals and related revenues for the three and nine months ended September 30, 2012 as compared with the same period in 2011 increased by $26,000 (5%) and $60,000 (4%), respectively. This was primarily as a result of increased rental income from tenants at the Monty's Property and also due to annual inflation adjustment in rent due from the tenant at Grove Isle.

Restaurant operations:
Summarized statements of income for the Company's Monty's restaurant for the three and nine months ended September 30, 2012 and 2011 are presented below:

                                              For the three months             For the nine months
                                               ended September 30,             ended September 30,
                                              2012            2011            2012            2011
               Revenues:
Food and Beverage Sales                    $ 1,272,000     $ 1,219,000     $ 4,628,000     $ 4,515,000

               Expenses:
Cost of food and beverage sold                 357,000         344,000       1,324,000       1,266,000
Labor and related costs                        284,000         255,000         911,000         845,000
Entertainers                                    50,000          49,000         149,000         145,000
Other food and beverage direct costs            59,000          57,000         214,000         188,000
Other operating costs                           58,000          56,000         186,000         232,000
Repairs and maintenance                         48,000          42,000         167,000         122,000
Insurance                                       72,000          83,000         231,000         240,000
Management and accounting fees                  35,000          48,000         105,000         112,000
Utilities                                       57,000          60,000         170,000         188,000
Rent (as allocated)                            134,000         129,000         468,000         457,000
             Total Expenses                  1,154,000       1,123,000       3,925,000       3,795,000

Income before depreciation and non
controlling interest                       $   118,000     $    96,000     $   703,000     $   720,000

Amounts above are presented as a percentage of sales below:

                                              For the three months             For the nine months
                                               ended September 30,             ended September 30,
                                              2012             2011           2012             2011
               Revenues:
Food and Beverage Sales                           100 %            100 %          100 %            100 %

               Expenses:
Cost of food and beverage sold                     28 %             28 %           29 %             28 %
Labor and related costs                            22 %             21 %           20 %             19 %
Entertainers                                        4 %              4 %            3 %              3 %
Other food and beverage direct costs                5 %              5 %            4 %              4 %
Other operating costs                               5 %              5 %            4 %              5 %
Repairs and maintenance                             4 %              3 %            4 %              3 %
Insurance                                           6 %              7 %            5 %              5 %
Management and accounting fees                      3 %              4 %            2 %              3 %
Utilities                                           4 %              4 %            4 %              4 %
Rent (as allocated)                                10 %             11 %           10 %             10 %
Total Expenses                                     91 %             92 %           85 %             84 %
Income before depreciation and
non-controlling interest                            9 %              8 %           15 %             16 %

For the nine months ended September 30, 2012 as compared with the same period in 2011, restaurant sales increased by approximately $113,000 (2%), with food sales increasing by $95,000 (3%) and beverage sales increasing $18,000 (1%).

For the three months ended September 30, 2012 as compared with the same period in 2011, restaurant sales increased by $53,000 (4%), with food sales increasing by $39,000 (6%) and beverage sales increasing $14,000 (2%).

For the three and nine months ended September 30, 2012 as compared with the same periods in 2011, total restaurant expenses increased by $31,000 (3%) and $130,000 (3%), respectively. This was primarily due to higher food costs and increased labor costs.

Marina operations:
Summarized and combined statements of income for marina operations for the three and nine months ended September 30, 2012 and 2011 (The Company owns 50% of the Monty's marina and 95% of the Grove Isle marina) are presented below:

                                             For the three months            For the nine months
                                              ended September 30,            ended September 30,
                                              2012           2011           2012            2011
            Marina Revenues:
Monty's dockage fees and related income    $   282,000     $ 259,000     $   861,000     $   850,000
Grove Isle marina slip owners dues and
dockage fees                                   126,000       126,000         378,000         350,000
Total marina revenues                          408,000       385,000       1,239,000       1,200,000

             Marina Expenses:
Labor and related costs                         61,000        70,000         191,000         201,000
Insurance                                       22,000        24,000          69,000          67,000
Management fees                                 18,000        17,000          54,000          54,000
Utilities, net of tenant reimbursement          12,000         4,000          (9,000 )       (14,000 )
Rent and bay bottom lease expense               63,000        49,000         173,000         159,000
Repairs and maintenance                         29,000        26,000          86,000         121,000
Other                                           19,000        21,000          77,000          68,000
Total marina expenses                          224,000       211,000         641,000         656,000

Income before depreciation and non
controlling interest                       $   184,000     $ 174,000     $   598,000     $   544,000

Total marina revenues for the three and nine months ended September 30, 2012 as compared to the same periods in 2011 increased by $23,000 (6%) and $39,000 (3%). This was primarily due to a rate increased in the Grove Isle Marina slip owner's dues.

Total marina expenses for the three months ended September 30, 2012 as compared to the same period in 2011 increased by $13,000 (6%), primarily due to increased rent expense. Total marina expenses for the nine months ended September 30, 2012 as compared to the same period in 2011 decreased by $15,000 (2%), primarily due to lower repairs and maintenance expense.

Spa operations:
Below are summarized statements of income for Grove Spa operations for the three and nine months ended September 30, 2012 and 2011. The Company owns 50% of the Grove Isle Spa with the other 50% owned by an affiliate of Grand Heritage, the tenant of the Grove Isle Resort:

                                           Three months      Three months       Nine months       Nine months
                                               ended             ended             ended             ended
 Summarized statements of income of spa    September 30,     September 30,     September 30,     September 30,
               operations                      2012              2011              2012              2011
               Revenues:
Services provided                          $      96,000     $     196,000     $     296,000     $     367,000
Membership and other                              15,000            16,000            54,000            54,000
Total spa revenues                               111,000           212,000           350,000           421,000
               Expenses:
Cost of sales (commissions and other)             19,000            33,000            63,000            67,000
Salaries, wages and related                       38,000            40,000           115,000           105,000
Other operating expenses                          32,000           119,000           144,000           209,000
Management and administrative fees                 6,000            11,000            14,000            23,000
Other non-operating expenses                       1,000             2,000            10,000            11,000
Total Expenses                                    96,000           205,000           346,000           415,000

Income (loss) before interest,
depreciation and non-controlling
interest                                   $      15,000     $       7,000     $       4,000     $       6,000

Spa revenues for the three and nine months ended September 30, 2012 as compared with the same periods in 2011 decreased by $101,000 (48%) and $70,000 (17%), respectively. Spa expenses for the three and nine months ended September 30, 2012 as compared with the same periods in 2011 decreased by $109,000 (53%) and $68,000 (16%), respectively. These decreases in were primarily due to the termination of a high discount sales promotional program which had been in place for almost a year.

Net realized and unrealized gain (loss) from investments in marketable securities:
Net realized and unrealized gain from investments in marketable securities for the three and nine months ended September 30, 2012 was approximately $45,000 and $142,000, respectively. This is as compared to net realized and unrealized loss from investments in marketable securities for the three and nine months ended September 30, 2011 of approximately $173,000 and $141,000, respectively. For further details refer to Note 4 to Condensed Consolidated Financial Statements (unaudited).

Net income from other investments:
Net income from other investments for the three and nine months ended September 30, 2012 was approximately $20,000 and $337,000, respectively. This is as compared to net income from other investments for the three and nine months ended September 30, 2011 of $10,000 and $56,000, respectively. For further details refer to Note 5 to Condensed Consolidated Financial Statements (unaudited).

Realized loss from interest rate swap contract:
In conjunction with amendment of the Bayshore bank loan in March 2011 the interest rate swap contract liability was paid down by $198,400 (in the same proportion as the amount of the loan principal paid down). As a result, the Company reclassified a previously unrealized loss of $198,400 from accumulated other comprehensive income to realized loss on interest rate swap contract within the condensed consolidated statements of comprehensive income for the three months ended March 31, 2011. There was no realized loss from the interest rate swap contract for the three and nine months ended September 30, 2012.

Interest, dividend and other income:
Interest, dividend and other income for the three and nine months ended September 30, 2012 was approximately $43,000 and $112,000, respectively. This is as compared to income of approximately $34,000 and $160,000 for the three and nine months ended September 30, 2011. This decrease of $48,000 (30%) for the nine months ended September 30, 2012 was primarily due to a decrease in service related income from the Company's subsidiary Courtland Houston.

EXPENSES
Expenses for rental and other properties for the three and nine months ended September 30, 2012 were $179,000 and $479,000, respectively. This is as compared to the same expenses of approximately $212,000 and $560,000 for the three and nine months ended September 30, 2011. The decreases in the three and nine month comparable periods of $33,000 (15%) and $81,000 (14%), respectively was due to decreased expenses of the Company's Monty's real estate operations, including decreased repairs, maintenance and insurance expense.

For comparisons of all food and beverage related expenses refer to Restaurant Operations (above) summarized statement of income for Monty's restaurant.

For comparisons of all marina related expenses refer to Marina Operations
(above) for summarized and combined statements of income for marina operations.

For comparisons of all spa related expenses refer to Spa Operations (above) for summarized statements of income for spa operations.

Depreciation and amortization expense for the three and nine months ended September 30, 2012 compared to the same periods in 2011 decreased by $14,000 (6%) and $186,000 (22%), respectively. The decrease in the nine month comparable periods was primarily due to the non-recurring amortization expense of loan costs associated with the Monty's loan modification completed in March 2011.

General and administrative expense for the three and nine months ended September 30, 2012 compared to the same periods in 2011 decreased by approximately $33,000 (29%) and $16,000 (6%), respectively. This was primarily due to a decrease in non-employee stock compensation expense.

Professional fees and expenses for the three and nine months ended September 30, 2012 compared to the same periods in 2011 decreased by $62,000 (57%) and $133,000 (44%), respectively. These changes were primarily due to lower legal costs relating to ongoing Grove Isle litigation.

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 $3.2 million in 2012 and contributions committed to other investments of approximately $812,000 due upon demand. The funds necessary to meet these obligations are expected to come from the proceeds from the sales of properties or investments, bank loans, refinancing of existing bank loans, distributions from investments and available cash.

In June 2012 the Company renewed and modified the existing bank mortgage note payable on the Grove Isle property with the same lender. The renewal and modification extends the maturity date to June 30, 2016 and calls for the same monthly principal payments of $10,000 plus interest calculated at the one-month LIBOR rate plus 3% with an interest rate floor 4.5%.

Included in the maturing debt obligations for 2012 is a note payable to the Company's 49% owned affiliate, T.G.I.F. Texas, Inc. ("TGIF") of approximately $3.1 million 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.

MATERIAL COMPONENTS OF CASH FLOWS
For the nine months ended September 30, 2012, net cash provided by operating activities was approximately $460,000. This was primarily from the cash flow provided by the Company's rental operations.

For the nine months ended September 30, 2012, net cash provided by investing activities was approximately $341,000. This consisted primarily of approximately $971,000 in net proceeds from sales of marketable securities and distributions from other investment of $528,000. These sources of funds were partially offset by purchases of marketable securities of $694,000, contributions to other investments of $227,000 and additions to fixed assets of $228,000.

For the nine months ended September 30, 2012, net cash used in financing activities was approximately $529,000 consisting of loan principal repayments of $417,000 and purchase of treasury stock of $112,000.