[LEFT][FONT=Century Gothic][SIZE=3]JOE?s real estate markets remain challenging. As a result, during the second quarter JOE implemented the following steps: [/SIZE][/FONT] [FONT=Century Gothic][SIZE=3]? JOE completed the prepayment of its $240 million senior notes, virtually eliminating our debt; [/SIZE][/FONT][/LEFT] [FONT=Century Gothic] [/FONT] [LEFT][FONT=Century Gothic][SIZE=3]? JOE significantly reduced its employee headcount and its annual payroll expense run rate; [/SIZE][/FONT][/LEFT] [FONT=Century Gothic] [/FONT] [LEFT][FONT=Century Gothic][SIZE=3]? JOE sold non-strategic rural lands for a total of $39.0 million; and [/SIZE][/FONT][/LEFT] [FONT=Century Gothic] [/FONT] [LEFT][FONT=Century Gothic][SIZE=3]? JOE successfully implemented its succession plan in May, with Britt Greene assuming the role of CEO and Peter Rummell continuing as chairman. [/SIZE][/FONT] [FONT=Century Gothic][SIZE=3]Concurrently, JOE positioned itself to benefit from the return of a healthier real estate market: [/SIZE][/FONT] [FONT=Century Gothic][SIZE=3]? JOE commenced resort operations at WindMark Beach and launched a national promotion of the resort with its strategic partner, Southern Progress Corporation, publishers of [/SIZE][I][SIZE=3]Southern Living [/SIZE][/I][SIZE=3]and [/SIZE][I][SIZE=3]Coastal Living [/SIZE][/I][SIZE=3]magazines; [/SIZE][/FONT][/LEFT] [FONT=Century Gothic] [/FONT] [LEFT][FONT=Century Gothic][SIZE=3]? The State of Florida appropriated additional funds that can be used to extend the runway length and improve highway access to the new Panama City ? Bay County International Airport; and [/SIZE][/FONT][/LEFT] [FONT=Century Gothic] [/FONT] [LEFT][FONT=Century Gothic][SIZE=3]? Construction of the new airport continues on schedule and on budget. [/SIZE][/FONT] [FONT=Century Gothic][SIZE=3][/SIZE][/FONT] [/LEFT] [SIZE=3][SIZE=3][LEFT][FONT=Century Gothic]During the fourth quarter of 2007, JOE announced it was marketing certain of its non-strategic rural lands for sale. During the quarter ended June 30, 2008, JOE sold 29,398 acres for a total of $39.0 million as a part of this program. [/FONT] [FONT=Century Gothic]After the end of the quarter, JOE executed a contract for the sale of 67,365 acres of non-strategic rural conservation land in Liberty, Jefferson, Gulf and Franklin Counties. The sale will be closed in two transactions for a total price of $130.4 million. The first sale of 39,359 acres for $67.3 million is scheduled to be completed in the fourth quarter of this year. The second sale of 28,005 acres is scheduled for the second quarter of 2009 at a price of $63.1 million. These transactions are subject to ongoing due diligence review and customary closing conditions. [/FONT][/LEFT] [FONT=Century Gothic]"We look forward to closing this sale and believe it represents good value for our shareholders," said Greene. "At this time we do not expect to close any other large-tract land sales in 2008." [/FONT] [FONT=Century Gothic][/FONT] [LEFT][SIZE=3][FONT=Century Gothic]Resort and primary residential sales generated $7.2 million in revenue in the second quarter. "The spring and summer selling season in our resort markets has not materialized as we had hoped," said Greene. "Although we have seen significant resale activity in WaterColor and WaterSound Beach, the market remains challenged by high inventory and cautious buyers." [/FONT][/LEFT] [FONT=Century Gothic][/FONT] [SIZE=3][FONT=Century Gothic]After the close of the second quarter, JOE and Glimcher Realty Trust [B]entered into a strategic partnership to develop an anchored retail shopping center across from Pier Park along Highway 98 in Panama City Beach. JOE and Glimcher will jointly develop 58 acres that will be marketed to large national retail outlets.[/B] The agreement is subject to minimum leasing requirements, financing and other customary conditions. [/FONT] [FONT=Century Gothic][/FONT] [FONT=Century Gothic][/FONT] [/SIZE][/SIZE][/SIZE][/SIZE][FONT=Century Gothic] [/FONT]
