Wellsford Real Properties, Inc. Reports Third Quarter 2006 Results

  
    
  
  
    
      Wellsford Real Properties, Inc. (AMEX:WRP) announced today that its net 
      assets in liquidation at September 30, 2006 aggregated $56,210,634 or 
      $8.69 per share based upon 6,471,179 common shares outstanding. Net 
      assets in liquidation aggregated $56,569,414 or $8.74 per share at 
      December 31, 2005 and $55,844,106 or $8.63 per share at June 30, 2006.
    
    
      At September 30, 2006, WRP had total assets of $115,442,427 which was 
      comprised primarily of real estate assets under development of 
      $49,606,070, investments in joint ventures and Reis, Inc. (“Reis”) 
      of $20,453,074, cash of $38,000,641 and restricted cash and investments 
      of $4,609,931. Total liabilities and minority interests of $59,231,793 
      at September 30, 2006 was comprised of the reserve for estimated costs 
      during the period of liquidation of $20,837,482, mortgage notes and 
      construction loans payable of $23,584,254, the reserve for option 
      cancellations of $2,711,000 and construction payables, other accruals 
      and liabilities and minority interests aggregating $12,099,057.
    
    
      During the three months ended September 30, 2006, net assets in 
      liquidation increased approximately $366,528. This increase is 
      attributable to (i) operating income of approximately $441,917 which 
      primarily represents interest income earned from cash and cash 
      equivalents and (ii) the increase in real estate assets under 
      development of $393,765, which results primarily from changes in the net 
      realizable value estimates of certain development projects due to the 
      shortening of the discount period as a result of the passage of time, 
      offset by (iii) the recording of a $469,154 increase to the reserve for 
      option cancellations to reflect the increase in the market price of WRP’s 
      common stock between June 30, 2006 and September 30, 2006.
    
    
      During the nine months ended September 30, 2006, net assets in 
      liquidation decreased $358,780. This decrease is primarily attributable 
      to the recording of a $4,226,938 provision upon the adoption by the 
      Board of modifications in the terms of WRP’s 
      stock option plans during the first quarter of 2006. The provision 
      resulted from the modification to allow for cash payments that would be 
      made to option holders, at their election, as consideration for the 
      cancellation of their options in the amount of the fair value of WRP’s 
      common stock in excess of the adjusted exercise prices of outstanding 
      options as of March 31, 2006. This liability has been decreased by 
      $848,351 to reflect the changes in the market price of WRP’s 
      common stock between March 31, 2006 and September 30, 2006. The net 
      decrease was offset by (i) a net increase in value of real estate assets 
      under development of $1,747,042 which results primarily from changes in 
      the net realizable value estimates, including the shortening of the 
      discount periods as a result of the passage of time and sales of 
      condominium units and homes and (ii) operating income of approximately 
      $1,272,765 which primarily represents interest income earned from cash 
      and cash equivalents.
    
    
      WRP had announced in November 2005 that its stockholders approved the 
      Plan of Liquidation (the “Plan”) 
      at the annual meeting held on November 17, 2005. After the approval of 
      the Plan by the stockholders, WRP completed the sale of its largest 
      asset, the three residential rental phases of its Palomino Park project 
      for $176,000,000. On December 14, 2005, WRP made an initial liquidating 
      distribution of $14.00 per share, aggregating approximately $90,597,000, 
      to its stockholders.
    
    
      For all periods preceding stockholder approval of the Plan on November 
      17, 2005, WRP’s financial statements are 
      presented on the going concern basis of accounting. As required by 
      generally accepted accounting principles, WRP adopted the liquidation 
      basis of accounting as of the close of business on November 17, 2005. 
      Under the liquidation basis of accounting, assets are stated at their 
      estimated net realizable value and liabilities are stated at their 
      estimated settlement amounts, which estimates will be periodically 
      reviewed and adjusted as appropriate. If the Merger with Reis (as 
      described below) is consummated, then WRP would change from the 
      liquidation basis of accounting to the going concern basis of accounting 
      upon the effective termination of the Plan.
    
    
      WRP reported revenues of $4,231,164 and $12,569,984 and net income of 
      $3,776,753 and $3,954,913, or $0.58 and $0.61 per basic and diluted 
      share for the three and nine months ended September 30, 2005, 
      respectively.
    
    
      Remaining Activities, Assets and Investments
    
    
      At September 30, 2006, WRP’s remaining 
      activities, assets and investments were comprised primarily of the 
      following:
    
    
      
        The 259 unit Gold Peak condominium development in Highlands Ranch, 
        Colorado is the remaining phase from our Palomino Park development. 
        Sales commenced in January 2006 and 75 Gold Peak units were sold by 
        September 30, 2006. At September 30, 2006 an additional 55 units were 
        under contract.
      
      
        The Orchards is a single family home development in East Lyme, 
        Connecticut, upon which WRP commenced building 101 single family homes 
        on 139 acres. An additional 60 homes could be built on a contiguous 85 
        acre parcel of land also owned by WRP. Sales commenced in June 2006 
        and one home was sold by September 30, 2006. At September 30, 2006, an 
        additional six East Lyme homes were under contract.
      
      
        A 75% ownership interest in a joint venture that owns two land parcels 
        aggregating approximately 300 acres in Claverack, New York. One land 
        parcel is subdivided into seven single family home lots upon which 
        Claverack intends to build and sell homes. The remaining 235 acres, 
        known as The Stewardship, are currently subdivided into six single 
        family home lots with the intent to obtain an increase in the number 
        of developable residential lots, improve the land, obtain construction 
        financing and construct and sell 48 single family homes.
      
      
        Interests aggregating 23% in Reis, a real estate information and 
        database company.
      
      
        A 10% interest in Clairborne Fordham, a company which currently owns 
        and is selling the remaining two unsold residential units of a 
        50-story, 277 unit, luxury condominium apartment project in Chicago, 
        Illinois.
      
    
    
      Merger with Reis
    
    
      On October 11, 2006 WRP announced that it entered into a definitive 
      merger agreement to acquire Reis (the “Merger”). 
      The Merger was approved by the independent members of WRP’s 
      Board of Directors on that date. Reis stockholders, excluding WRP, will 
      receive, in the aggregate, approximately $34,600,000 in cash and 
      approximately 4,200,000 shares of newly issued common stock of WRP 
      which, for purposes of the Merger, has been established at $8.16 per 
      share resulting in an implied equity value for Reis of approximately 
      $90,000,000.
    
    
      The rules of the American Stock Exchange (the “AMEX”) 
      require WRP’s stockholders to approve the 
      issuance of shares of common stock of WRP to Reis stockholders, since 
      such an issuance would be greater than 20% of the common shares 
      currently outstanding. The transaction, which is also subject to the 
      approval of the Reis stockholders, regulatory approvals and other 
      customary closing conditions, is expected to close in the first quarter 
      of 2007.
    
    
      If the Merger is consummated, WRP would abandon its previously adopted 
      Plan, but would continue with its program of disposing of its remaining 
      real estate assets through development and/or sale.
    
    
      The cash portion of the purchase price is to be funded by a loan 
      extended to Reis by a financial institution aggregating $27,000,000 (of 
      which $25,000,000 can be used for Merger consideration and the payment 
      of related Merger costs and the remaining $2,000,000 can be utilized for 
      future working capital needs) and WRP’s cash 
      on hand. Upon completion of the Merger, WRP would have approximately 
      10,700,000 shares of common stock outstanding and change its corporate 
      name to Reis, Inc. Following the closing of the Merger, Reis 
      stockholders would own approximately 40% of the combined company.
    
    
      There can be no assurance that the Reis stockholders will vote to 
      approve the Merger and adopt the Merger agreement or that WRP’s 
      stockholders will vote to issue shares of WRP’s 
      common stock in connection with the Merger. Furthermore, there can be no 
      assurance following a vote in favor of the Merger and such issuance of 
      WRP’s common stock that the Merger will be 
      consummated.
    
    
      This press release, together with other statements and information 
      publicly disseminated by WRP, contains certain forward-looking 
      statements within the meaning of Section 27A of the Securities Act of 
      1933, as amended, and Section 21E of the Securities Exchange Act of 
      1934, as amended. Such forward-looking statements involve known and 
      unknown risks, uncertainties and other factors which may cause the 
      actual results, performance or achievements of WRP or industry results 
      to be materially different from any future results, performance or 
      achievements expressed or implied by such forward-looking statements. 
      Such factors include, among others, the following, which are discussed 
      in greater detail in the “Risk Factors” 
      section of WRP’s Form 10-K filed with the 
      Securities and Exchange Commission (“SEC”) 
      on March 16, 2006 and the registration statement on Form S-8 filed with 
      the SEC on June 7, 2006: general and local economic and business 
      conditions; future valuation adjustments as a result of possible 
      declines in the expected values and cash flows of residential 
      development projects and investments or changes in the intent with 
      regards to such projects and investments; competition; risks of real 
      estate development, construction and renovation including construction 
      delays and cost overruns; inability to comply with zoning and other laws 
      and obtain governmental approvals; the risk of inflation in development 
      costs (including construction materials); the availability of insurance 
      coverages; the inability to obtain or replace construction financing for 
      development projects; adverse consequences of debt financing including, 
      without limitation, the necessity of future financings to repay maturing 
      debt obligations; inability to meet financial and valuation covenants 
      contained in loan agreements; inability to repay financings; exposure to 
      variable rate based financings; risk of foreclosure on collateral; risks 
      of leverage; risks associated with equity investments in and with third 
      parties; risks associated with our reliance on joint venture partners 
      including, but not limited to, the inability to obtain consent from 
      partners for certain business decisions, the potential risk that our 
      partners may become bankrupt, have economic or other business interests 
      and objectives which may be inconsistent with those of the WRP and our 
      partners being in a position to take action contrary to our interests; 
      inability and/or unwillingness of partners to provide their share of any 
      future capital requirements; availability and cost of financing; 
      interest rate risks; demand by prospective buyers of condominiums and 
      single family homes; inability to realize gains from sales of 
      condominiums and single family homes; lower than anticipated sales 
      prices; inability to close on sales of properties; the risks of 
      seasonality and increasing interest rates on the WRP’s 
      ability to sell condominium units and single family homes; increases in 
      energy costs, construction materials and interest rates could adversely 
      impact our home building business as homes become more expensive to 
      build and profit margins could deteriorate; inability to raise sale 
      prices to maintain profit margins; the negative impact from a continuing 
      rise in energy costs and interest rates on our marketing efforts and the 
      ability for buyers to afford our homes at any price level, which could 
      result in the inability to meet targeted sales prices or cause sales 
      price reductions; environmental risks; the ability to gain governmental 
      approvals of the Merger on the proposed terms and schedule; the failure 
      of the WRP’s stockholders to approve the 
      issuance of WRP common shares in connection with the Merger or the 
      failure of Reis stockholders to approve the Merger; the risk that other 
      conditions to the Merger are not being satisfied; the risk of successful 
      integration of the two companies and the risk that cost savings, as well 
      as other synergies from the Merger, may not be realized or may take 
      longer to realize than expected; the risk that the combined companies 
      may not perform as anticipated; the ability of the combined companies to 
      retain customers and employees; competition and its effects on revenue; 
      the Board could abandon the Plan; failure to achieve proceeds from the 
      sales of assets to meet the estimate of total distributions to 
      stockholders under the Plan; the uncertainty as to the timing of sales 
      of assets and the impact on the timing of distributions to stockholders; 
      illiquidity of real estate assets and joint venture investments; 
      increases in expenses which would negatively impact the amount of 
      distributions pursuant to the Plan; unknown claims and liabilities which 
      would negatively impact the amount of distributions pursuant to the 
      Plan; the uncertainty as to the ultimate liability for option 
      cancellations and its effect on reported net assets in liquidation as 
      such amount is impacted by the decisions of the option holders and 
      changes in the WRP’s market price for its 
      common stock; the sale of undeveloped land, rather than the construction 
      and sale, in the normal course of business, of single family homes or 
      condominium units which would negatively impact the amount of 
      distributions pursuant to the Plan; the inability to utilize any or all 
      of the WRP’s Federal net operating loss 
      carryforwards; and other risks listed from time to time in the WRP’s 
      reports filed with the SEC. Therefore, actual results could differ 
      materially from those projected in such statements.
    
  
Wellsford Real Properties, Inc. (AMEX:WRP) announced today that
its net assets in liquidation at September 30, 2006 aggregated
$56,210,634 or $8.69 per share based upon 6,471,179 common shares
outstanding. Net assets in liquidation aggregated $56,569,414 or $8.74
per share at December 31, 2005 and $55,844,106 or $8.63 per share at
June 30, 2006.

   At September 30, 2006, WRP had total assets of $115,442,427 which
was comprised primarily of real estate assets under development of
$49,606,070, investments in joint ventures and Reis, Inc. ("Reis") of
$20,453,074, cash of $38,000,641 and restricted cash and investments
of $4,609,931. Total liabilities and minority interests of $59,231,793
at September 30, 2006 was comprised of the reserve for estimated costs
during the period of liquidation of $20,837,482, mortgage notes and
construction loans payable of $23,584,254, the reserve for option
cancellations of $2,711,000 and construction payables, other accruals
and liabilities and minority interests aggregating $12,099,057.

   During the three months ended September 30, 2006, net assets in
liquidation increased approximately $366,528. This increase is
attributable to (i) operating income of approximately $441,917 which
primarily represents interest income earned from cash and cash
equivalents and (ii) the increase in real estate assets under
development of $393,765, which results primarily from changes in the
net realizable value estimates of certain development projects due to
the shortening of the discount period as a result of the passage of
time, offset by (iii) the recording of a $469,154 increase to the
reserve for option cancellations to reflect the increase in the market
price of WRP's common stock between June 30, 2006 and September 30,
2006.

   During the nine months ended September 30, 2006, net assets in
liquidation decreased $358,780. This decrease is primarily
attributable to the recording of a $4,226,938 provision upon the
adoption by the Board of modifications in the terms of WRP's stock
option plans during the first quarter of 2006. The provision resulted
from the modification to allow for cash payments that would be made to
option holders, at their election, as consideration for the
cancellation of their options in the amount of the fair value of WRP's
common stock in excess of the adjusted exercise prices of outstanding
options as of March 31, 2006. This liability has been decreased by
$848,351 to reflect the changes in the market price of WRP's common
stock between March 31, 2006 and September 30, 2006. The net decrease
was offset by (i) a net increase in value of real estate assets under
development of $1,747,042 which results primarily from changes in the
net realizable value estimates, including the shortening of the
discount periods as a result of the passage of time and sales of
condominium units and homes and (ii) operating income of approximately
$1,272,765 which primarily represents interest income earned from cash
and cash equivalents.

   WRP had announced in November 2005 that its stockholders approved
the Plan of Liquidation (the "Plan") at the annual meeting held on
November 17, 2005. After the approval of the Plan by the stockholders,
WRP completed the sale of its largest asset, the three residential
rental phases of its Palomino Park project for $176,000,000. On
December 14, 2005, WRP made an initial liquidating distribution of
$14.00 per share, aggregating approximately $90,597,000, to its
stockholders.

   For all periods preceding stockholder approval of the Plan on
November 17, 2005, WRP's financial statements are presented on the
going concern basis of accounting. As required by generally accepted
accounting principles, WRP adopted the liquidation basis of accounting
as of the close of business on November 17, 2005. Under the
liquidation basis of accounting, assets are stated at their estimated
net realizable value and liabilities are stated at their estimated
settlement amounts, which estimates will be periodically reviewed and
adjusted as appropriate. If the Merger with Reis (as described below)
is consummated, then WRP would change from the liquidation basis of
accounting to the going concern basis of accounting upon the effective
termination of the Plan.

   WRP reported revenues of $4,231,164 and $12,569,984 and net income
of $3,776,753 and $3,954,913, or $0.58 and $0.61 per basic and diluted
share for the three and nine months ended September 30, 2005,
respectively.

   Remaining Activities, Assets and Investments

   At September 30, 2006, WRP's remaining activities, assets and
investments were comprised primarily of the following:

   --  The 259 unit Gold Peak condominium development in Highlands
        Ranch, Colorado is the remaining phase from our Palomino Park
        development. Sales commenced in January 2006 and 75 Gold Peak
        units were sold by September 30, 2006. At September 30, 2006
        an additional 55 units were under contract.

   --  The Orchards is a single family home development in East Lyme,
        Connecticut, upon which WRP commenced building 101 single
        family homes on 139 acres. An additional 60 homes could be
        built on a contiguous 85 acre parcel of land also owned by
        WRP. Sales commenced in June 2006 and one home was sold by
        September 30, 2006. At September 30, 2006, an additional six
        East Lyme homes were under contract.

   --  A 75% ownership interest in a joint venture that owns two land
        parcels aggregating approximately 300 acres in Claverack, New
        York. One land parcel is subdivided into seven single family
        home lots upon which Claverack intends to build and sell
        homes. The remaining 235 acres, known as The Stewardship, are
        currently subdivided into six single family home lots with the
        intent to obtain an increase in the number of developable
        residential lots, improve the land, obtain construction
        financing and construct and sell 48 single family homes.

   --  Interests aggregating 23% in Reis, a real estate information
        and database company.

   --  A 10% interest in Clairborne Fordham, a company which
        currently owns and is selling the remaining two unsold
        residential units of a 50-story, 277 unit, luxury condominium
        apartment project in Chicago, Illinois.

   Merger with Reis

   On October 11, 2006 WRP announced that it entered into a
definitive merger agreement to acquire Reis (the "Merger"). The Merger
was approved by the independent members of WRP's Board of Directors on
that date. Reis stockholders, excluding WRP, will receive, in the
aggregate, approximately $34,600,000 in cash and approximately
4,200,000 shares of newly issued common stock of WRP which, for
purposes of the Merger, has been established at $8.16 per share
resulting in an implied equity value for Reis of approximately
$90,000,000.

   The rules of the American Stock Exchange (the "AMEX") require
WRP's stockholders to approve the issuance of shares of common stock
of WRP to Reis stockholders, since such an issuance would be greater
than 20% of the common shares currently outstanding. The transaction,
which is also subject to the approval of the Reis stockholders,
regulatory approvals and other customary closing conditions, is
expected to close in the first quarter of 2007.

   If the Merger is consummated, WRP would abandon its previously
adopted Plan, but would continue with its program of disposing of its
remaining real estate assets through development and/or sale.

   The cash portion of the purchase price is to be funded by a loan
extended to Reis by a financial institution aggregating $27,000,000
(of which $25,000,000 can be used for Merger consideration and the
payment of related Merger costs and the remaining $2,000,000 can be
utilized for future working capital needs) and WRP's cash on hand.
Upon completion of the Merger, WRP would have approximately 10,700,000
shares of common stock outstanding and change its corporate name to
Reis, Inc. Following the closing of the Merger, Reis stockholders
would own approximately 40% of the combined company.

   There can be no assurance that the Reis stockholders will vote to
approve the Merger and adopt the Merger agreement or that WRP's
stockholders will vote to issue shares of WRP's common stock in
connection with the Merger. Furthermore, there can be no assurance
following a vote in favor of the Merger and such issuance of WRP's
common stock that the Merger will be consummated.

   This press release, together with other statements and information
publicly disseminated by WRP, contains certain forward-looking
statements within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of WRP or industry results
to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements.
Such factors include, among others, the following, which are discussed
in greater detail in the "Risk Factors" section of WRP's Form 10-K
filed with the Securities and Exchange Commission ("SEC") on March 16,
2006 and the registration statement on Form S-8 filed with the SEC on
June 7, 2006: general and local economic and business conditions;
future valuation adjustments as a result of possible declines in the
expected values and cash flows of residential development projects and
investments or changes in the intent with regards to such projects and
investments; competition; risks of real estate development,
construction and renovation including construction delays and cost
overruns; inability to comply with zoning and other laws and obtain
governmental approvals; the risk of inflation in development costs
(including construction materials); the availability of insurance
coverages; the inability to obtain or replace construction financing
for development projects; adverse consequences of debt financing
including, without limitation, the necessity of future financings to
repay maturing debt obligations; inability to meet financial and
valuation covenants contained in loan agreements; inability to repay
financings; exposure to variable rate based financings; risk of
foreclosure on collateral; risks of leverage; risks associated with
equity investments in and with third parties; risks associated with
our reliance on joint venture partners including, but not limited to,
the inability to obtain consent from partners for certain business
decisions, the potential risk that our partners may become bankrupt,
have economic or other business interests and objectives which may be
inconsistent with those of the WRP and our partners being in a
position to take action contrary to our interests; inability and/or
unwillingness of partners to provide their share of any future capital
requirements; availability and cost of financing; interest rate risks;
demand by prospective buyers of condominiums and single family homes;
inability to realize gains from sales of condominiums and single
family homes; lower than anticipated sales prices; inability to close
on sales of properties; the risks of seasonality and increasing
interest rates on the WRP's ability to sell condominium units and
single family homes; increases in energy costs, construction materials
and interest rates could adversely impact our home building business
as homes become more expensive to build and profit margins could
deteriorate; inability to raise sale prices to maintain profit
margins; the negative impact from a continuing rise in energy costs
and interest rates on our marketing efforts and the ability for buyers
to afford our homes at any price level, which could result in the
inability to meet targeted sales prices or cause sales price
reductions; environmental risks; the ability to gain governmental
approvals of the Merger on the proposed terms and schedule; the
failure of the WRP's stockholders to approve the issuance of WRP
common shares in connection with the Merger or the failure of Reis
stockholders to approve the Merger; the risk that other conditions to
the Merger are not being satisfied; the risk of successful integration
of the two companies and the risk that cost savings, as well as other
synergies from the Merger, may not be realized or may take longer to
realize than expected; the risk that the combined companies may not
perform as anticipated; the ability of the combined companies to
retain customers and employees; competition and its effects on
revenue; the Board could abandon the Plan; failure to achieve proceeds
from the sales of assets to meet the estimate of total distributions
to stockholders under the Plan; the uncertainty as to the timing of
sales of assets and the impact on the timing of distributions to
stockholders; illiquidity of real estate assets and joint venture
investments; increases in expenses which would negatively impact the
amount of distributions pursuant to the Plan; unknown claims and
liabilities which would negatively impact the amount of distributions
pursuant to the Plan; the uncertainty as to the ultimate liability for
option cancellations and its effect on reported net assets in
liquidation as such amount is impacted by the decisions of the option
holders and changes in the WRP's market price for its common stock;
the sale of undeveloped land, rather than the construction and sale,
in the normal course of business, of single family homes or
condominium units which would negatively impact the amount of
distributions pursuant to the Plan; the inability to utilize any or
all of the WRP's Federal net operating loss carryforwards; and other
risks listed from time to time in the WRP's reports filed with the
SEC. Therefore, actual results could differ materially from those
projected in such statements.