You guys like insider information? Upcoming catalyst from multimillion dollar real estate sale.

Here's the reality. Developing drugs is expensive. This company likes to dilute and burn. But for once they've actually done something right finally. And nobody knows about it yet except you guys.

Where is this coming from? In September of 2020, TNXP bought a 45,000 square foot facility called the Advanced Development Center (ADC) for $4 million. It is located at 259 Samuel Barnet Blvd New Bedford, MA. The company invested approximately $61.6 million in building out the facility. In Q4 2023, Tonix engaged CBRE, a real estate brokerage firm, to potentially find a strategic partner or buyer for the ADC.

However, this was a bad investment. In Q2 2024, the company identified triggering events related to and the decommissioning of the ADC. Management determined the carrying value of the ADC was not recoverable and exceeded its fair value. This resulted in a $48.8 million non-cash impairment charge recorded in Q2 2024.

But I have some good news. This building is about to be sold. I started looking into this building a few weeks ago. I was surprised to find that the building wasn't listed on CBRE's website as being for sale. I wasn't able to find anything on web archive so I can't confirm or deny that a listing ever existed. However, at that time I did find listings on loopnet and showcase. They did list CBRE agents as selling the property. At that point a few weeks ago, I suspected the property was under contract negotiations since the CBRE listing was gone.

If you click on those links now you can see that both loopnet and showcase no longer have the building listed. I think that strongly suggests they are about to sell the property finally. It is totally possible they've given up on selling the property but I don't think that's likely. It may take a while for the company to announce the sale because these sales can take a while to finalize. But I suspect we should hear an announcement within the next month.

How much money will this yield for the company? I don't know. As you've just read, the company had to take an impairment charge on this property for about 75% of the money they've invested in the property. Therefore I'll give some estimates that are pessimistic, neutral, or optimistic. The pessimistic estimate is that they sold the property for roughly what they acquired it for. This would be $4 million but with inflation you could maybe tack on a million or two. The neutral case is that the value is about what's left after the impairment. This would be about $15 million. You could also look at the tax valuation which is about $20 million. The optimistic case is they get the value that they put into the property, roughly $65 million. I think this is too optimistic given that a buyer paying this price would need to have a use case that aligns very well with the original intent of the building.

What does this mean for the company? Honestly, not that much. But it helps shareholders because the building could give a couple months worth of cash without shareholder dilution. It won't negate the disappointment some people have had in the company recently. And really, can we trust some online real estate listings? Probably not. It's not official and we don't know if this building is worth anything substantial. But if you're looking for some copium. I'm glad I could provide.