[PART I. FINANCIAL INFORMATION](index=2&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) American Realty Investors, Inc. reported Q1 2025 net income of **$4.0 million** (up from **$2.3 million**), driven by a **$3.9 million** real estate gain, with total assets at **$1.045 billion** and negative operating cash flow of **$7.4 million** due to development [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to **$1.045 billion** as of March 31, 2025, from **$1.033 billion** at year-end 2024, driven by real estate assets, with total liabilities rising to **$239.4 million** and total equity slightly increasing to **$805.6 million** Consolidated Balance Sheet Summary (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$1,044,999** | **$1,032,802** | | Real estate | $582,232 | $557,388 | | Cash and cash equivalents | $13,800 | $19,918 | | **Total Liabilities** | **$239,445** | **$230,532** | | Mortgages and other notes payable | $201,695 | $185,398 | | **Total Equity** | **$805,554** | **$802,270** | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The company reported Q1 2025 net income attributable to common shares of **$3.0 million** (**$0.18 per share**), up from **$1.8 million** (**$0.11 per share**) in Q1 2024, mainly due to a **$3.9 million** gain on real estate transactions offsetting decreased net operating income and higher advisory fees Q1 2025 vs Q1 2024 Statement of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenue | $12,008 | $11,899 | | Total Operating Expenses | $12,821 | $13,416 | | Net Operating Loss | ($813) | ($1,517) | | Gain on real estate transactions | $3,891 | $0 | | **Net Income** | **$3,963** | **$2,302** | | **Net Income Attributable to Common Shares** | **$2,965** | **$1,751** | | **Earnings Per Share (EPS)** | **$0.18** | **$0.11** | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating cash flow was a net use of **$7.4 million**, a downturn from **$3.9 million** provided in Q1 2024, with investing activities using **$16.6 million** for development and financing providing **$15.6 million** from new mortgages, resulting in an **$8.4 million** decrease in cash Q1 2025 vs Q1 2024 Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Cash (Used in) Provided by Operating Activities | ($7,408) | $3,867 | | Net Cash (Used in) Provided by Investing Activities | ($16,630) | $11,574 | | Net Cash Provided by (Used in) Financing Activities | $15,600 | ($1,456) | | **Net (Decrease) Increase in Cash** | **($8,438)** | **$13,985** | [Notes to Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the company's structure, accounting policies, and financial components, highlighting its multifamily and commercial segments, significant ongoing real estate development, debt obligations including a loan covenant breach, and extensive related-party transactions - The company's primary business is acquiring, developing, and owning income-producing multifamily and commercial properties Substantially all operations are conducted through its **78.4% owned subsidiary, Transcontinental Realty Investors, Inc. (TCI)**[19](index=19&type=chunk)[20](index=20&type=chunk) Segment Profit (in thousands) | Segment | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Multifamily Segment Profit | $4,724 | $4,291 | | Commercial Segment Profit | $1,307 | $974 | | **Total Profit from Segments** | **$6,031** | **$5,265** | - The company is actively developing four multifamily properties with a total projected cost of **$206.8 million**, of which **$119.0 million** has been incurred as of March 31, 2025[41](index=41&type=chunk) - The company was not in compliance with the minimum debt service coverage ratio (DSCR) for the loan on the 770 South Post Oak property, requiring surplus cash flow from the property to be held in a lockbox account[59](index=59&type=chunk) - Significant related-party transactions exist with Pillar (manager), Regis (property manager), and MRHI (controlling shareholder) In Q1 2025, fees paid to Pillar included **$2.5 million** for advisory services and **$0.7 million** for development[64](index=64&type=chunk)[66](index=66&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the **$1.7 million** net income increase to a **$3.1 million** condemnation gain, offsetting a **$1.6 million** net interest income decrease, with significant focus on four multifamily developments, reflected in increased investing cash use and **$17.1 million** in new construction loans, resulting in **$5.2 million** FFO - Recent activities include the sale of land at Windmill Farms, which generated a **$3.1 million** gain from a condemnation settlement in March 2025[88](index=88&type=chunk) - The company is developing four multifamily properties (Alera, Bandera Ridge, Merano, Mountain Creek) with a total project cost of approximately **$207 million** In Q1 2025, **$26.3 million** in development costs were incurred, funded by **$17.1 million** in construction loans[89](index=89&type=chunk)[90](index=90&type=chunk) - The **$1.7 million** increase in net income was primarily driven by a **$3.9 million** gain on real estate transactions, while net interest income decreased by **$1.6 million** due to lower average balances on short-term investments[103](index=103&type=chunk)[109](index=109&type=chunk) - The significant increase in cash used in investing activities (**$28.2 million** YoY) was due to a **$20.7 million** increase in real estate development and renovation costs[107](index=107&type=chunk) FFO Reconciliation Summary (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income attributable to the Company | $2,965 | $1,751 | | Depreciation and amortization | $2,883 | $3,172 | | Gain on real estate transactions | ($3,891) | $0 | | **FFO-Basic and Diluted** | **$5,162** | **$4,976** | [Item 3. Quantitative and Qualitative Disclosures About Market Risks](index=24&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risks) This section is optional and was not included in the report - The company has opted not to include quantitative and qualitative disclosures about market risks in this report[115](index=115&type=chunk) [Item 4. Controls and Procedures](index=25&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[117](index=117&type=chunk) - No changes in internal control over financial reporting occurred during the most recent fiscal quarter that materially affected, or are reasonably likely to materially affect, internal controls[118](index=118&type=chunk) [PART II. OTHER INFORMATION](index=25&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=25&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no new legal proceedings in this section - The company reports 'None' for this item, indicating no new legal proceedings to disclose under this specific section[119](index=119&type=chunk) [Item 1A. Risk Factors](index=25&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes from the risk factors previously disclosed in the company's 2024 Form 10-K - No material changes to risk factors have occurred since the filing of the 2024 10-K[119](index=119&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=25&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not repurchase any shares under its existing share repurchase program during Q1 2025, with **263,250 shares** remaining available for purchase - No shares were repurchased during Q1 2025 under the company's buyback program[120](index=120&type=chunk) - As of March 31, 2025, **263,250 shares** may still be purchased under the existing repurchase program[120](index=120&type=chunk) [Item 3. Defaults Upon Senior Securities](index=25&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - The company reports 'None' for this item[121](index=121&type=chunk) [Item 4. Mine Safety Disclosures](index=25&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - The company reports 'None' for this item as it is not applicable[121](index=121&type=chunk) [Item 5. Other Information](index=25&type=section&id=Item%205.%20Other%20Information) The company reported no other information - The company reports 'None' for this item[121](index=121&type=chunk) [Item 6. Exhibits](index=26&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with or incorporated by reference into the Form 10-Q, including certifications by the CEO and CAO - The report includes a list of exhibits filed, such as corporate governance documents and officer certifications under Sections 302 and 906 of the Sarbanes-Oxley Act[122](index=122&type=chunk)

Financial Performance - For Q4 2024, American Realty Investors, Inc. reported a net loss attributable to common shares of $0.2 million or $0.01 per diluted share, a significant improvement from a net loss of $2.1 million or $0.13 per diluted share in Q4 2023[2][8]. - Total revenue for Q4 2024 was $12.0 million, down from $14.0 million in Q4 2023[11]. - Net operating loss decreased by $0.4 million from $2.2 million in Q4 2023 to $1.8 million in Q4 2024, attributed to a $2.4 million decrease in operating expenses[5]. - Operating expenses decreased from $16.2 million in Q4 2023 to $13.8 million in Q4 2024[11]. - The company reported interest income of $3.9 million in Q4 2024, compared to $1.6 million in Q4 2023[11]. Revenue and Occupancy - Rental revenues decreased by $1.6 million from $12.8 million in Q4 2023 to $11.2 million in Q4 2024, primarily due to a decrease in occupancy at commercial properties[4]. - Total occupancy was 81% as of December 31, 2024, with multifamily properties at 94% and commercial properties at 53%[7]. Legal and Financial Transactions - A settlement of $23.4 million was paid to resolve ongoing litigation, resulting in an accrued loss on real estate transactions of $23.4 million for the period[7]. - The company sold 30 single-family lots for $1.4 million, resulting in a gain on sale of $1.1 million[7]. Development Projects - A $27.5 million construction loan was obtained for the development of a 234-unit multifamily property in Dallas, expected to be completed in 2026[7].

Debt and Indebtedness - Total indebtedness as of December 31, 2024, was approximately $185.4 million, with 68% ($126.3 million) insured by HUD[55][56]. - The degree of indebtedness could impact the company's ability to secure additional financing for working capital, capital expenditures, or acquisitions[63]. - The company operates with a policy of incurring additional indebtedness only when advisable, which may include borrowing under a line of credit or issuing debt securities[63]. Operational Risks - The company faces risks associated with increased operating costs, including insurance, maintenance, and administrative costs, which could adversely affect cash flow and shareholder distributions[50]. - The company is reliant on third-party management companies for property operations, which may impact profitability if these managers do not perform effectively[48][49]. - The company has ongoing development projects, but construction costs may exceed estimates, affecting profitability and project completion timelines[51]. - The company may encounter challenges in leasing newly developed properties at budgeted rental rates, impacting expected financial results[56]. - The company may face competition from other real estate investors, which could drive up acquisition costs and impact property performance[55][61]. Market Vulnerability - The company operates in specific geographic areas in the Southern United States, making it vulnerable to adverse economic conditions in those markets[54]. - Rising interest rates could increase costs on variable rate debt, adversely affecting cash flow and the ability to refinance existing debt[58]. - The company may not be able to sell properties quickly due to the illiquid nature of real estate investments, which could limit cash flow responses to changing circumstances[60]. Partnership and Liability Issues - Potential bankruptcy of partners could leave the company liable for the liabilities of the venture[63]. - Partners may have inconsistent economic or business interests that conflict with the company's objectives[63]. - Governing agreements in partnerships may restrict the transfer of interests, potentially resulting in disadvantageous terms[63]. Tenant Relations - The company’s ability to attract and retain tenants is critical for cash flow, and adverse events affecting existing tenants could hinder this ability[45].

Financial Performance - Net income attributable to common shares for Q3 2024 was a loss of $17.5 million or $1.08 per diluted share, compared to a net income of $3.0 million or $0.18 per diluted share in Q3 2023[1][5]. - Total revenue for Q3 2024 was $11.6 million, down from $12.5 million in Q3 2023[7]. - Net operating loss for Q3 2024 was $2.1 million, consistent with the loss reported in Q3 2023[4]. - General and administrative expenses were $1.59 million in Q3 2024, slightly up from $1.58 million in Q3 2023[7]. - The weighted average common shares used in computing earnings per share remained constant at 16,152,043 for both Q3 2024 and Q3 2023[7]. Occupancy and Rental Revenue - Total occupancy as of September 30, 2024, was 79%, with multifamily properties at 95% and commercial properties at 48%[2]. - Rental revenues decreased by $0.8 million from $11.8 million in Q3 2023 to $11.1 million in Q3 2024, primarily due to lower occupancy in commercial properties[3]. - A new lease at Stanford Center, covering 45,000 square feet, is expected to increase occupancy by 14% and rent per square foot by 20% over recent expired leases[2]. Development and Financing - A $27.5 million construction loan was obtained for the development of a 234-unit multifamily property in Dallas, Texas, expected to be completed in 2026[2]. Legal and Settlement Issues - The company accrued a loss of $23.4 million related to the settlement of claims with David Clapper and related entities[2][5].

Debt Management - The company paid off $67.5 million of Series C bonds on January 31, 2023[78]. - The company incurred a loss of $1.7 million on the early extinguishment of debt when paying off remaining Series A and B Bonds on May 4, 2023[79]. - The company extended the maturity of its loan on Windmill Farms to February 28, 2026, at an interest rate of 7.50%[79]. - The company reported a $137.4 million decrease in cash used in financing activities, primarily due to the repayment of bonds in 2023[105]. Construction and Development - A $33.0 million construction loan was secured on March 15, 2023, for the development of a 240-unit multifamily property in Lake Wales, Florida, with an expected total cost of approximately $55.3 million[81]. - A $25.4 million construction loan was entered into on November 6, 2023, for the development of a 216-unit multifamily property in McKinney, Texas, with an expected total cost of approximately $51.9 million[82]. - The company entered into a $23.5 million construction loan on December 15, 2023, for the development of a 216-unit multifamily property in Temple, Texas, with an expected total cost of approximately $49.6 million[83]. - The company has incurred a total of $31.9 million in development costs for the Alera project as of September 30, 2024[81]. - As of September 30, 2024, the company has incurred a total of $11.1 million in development costs for the Bandera Ridge project[83]. - The company has agreements to develop 125 acres of raw land into approximately 470 land lots for single-family homes at a total cost of $24.3 million, expected to be completed over a two-year period starting Q3 2024[80]. Financial Performance - Multifamily segment revenue increased to $7.967 billion for the three months ended September 30, 2024, compared to $7.899 billion in the same period of 2023, reflecting a variance of $68 million[96]. - Net income for the three months ended September 30, 2024, decreased by $21 million to a loss of $17.016 billion, compared to a profit of $4.025 billion in the same period of 2023[96]. - The commercial segment revenue decreased to $3.107 billion for the three months ended September 30, 2024, down from $3.939 billion in the same period of 2023, a decline of $832 million[96]. - Operating expenses for the multifamily segment decreased by $169 million to $4.642 billion for the three months ended September 30, 2024, compared to $4.811 billion in the same period of 2023[96]. - The loss on real estate transactions increased by $23.4 million due to the settlement of litigation in 2024, impacting overall profitability[98]. - Funds From Operations (FFO) for the three months ended September 30, 2024, was $9.128 million, compared to $6.439 million in the same period of 2023, indicating improved operational performance[111]. Cash Flow and Liquidity - Net cash provided by operating activities increased to $16.859 million for the nine months ended September 30, 2024, compared to $7.846 million in the same period of 2023, a variance of $9.013 million[103]. - Cash used in investing activities decreased by $17.332 million, primarily due to a reduction in development and renovation costs[104]. - The company anticipates that cash and cash equivalents as of September 30, 2024, will be sufficient to meet all cash requirements, supported by property operations and refinancing activities[102]. Legal and Settlement Matters - A settlement agreement required the company to pay $23.4 million by October 31, 2024, related to litigation from a 1998 multifamily property transaction[85]. - The Company executed a Settlement Agreement requiring a payment of $23.4 million to Clapper by October 31, 2024, which has been completed[116]. - The litigation involved a $148 million judgment against ARL in 2011, which was reversed in May 2021, but was appealed again leading to a new trial[116]. - The settlement has been accrued as a loss on real estate transactions during the three and nine months ended September 30, 2024[116].

Financial Performance - Net income attributable to common shares increased to $1.2 million or $0.07 per diluted share for Q2 2024, compared to $0.1 million or $0.01 per diluted share in Q2 2023, representing a significant increase of 1,100%[2][5] - Net operating loss decreased by $2.6 million from $3.9 million in Q2 2023 to $1.3 million in Q2 2024, attributed to lower general and administrative expenses[4] - The company reported a net operating loss of $1.3 million for Q2 2024, a significant improvement compared to a loss of $3.9 million in Q2 2023[4] Revenue and Occupancy - Total revenue for the six months ended June 30, 2024, was $23.7 million, down from $23.9 million for the same period in 2023[8] - Rental revenues decreased by $0.2 million from $11.4 million in Q2 2023 to $11.2 million in Q2 2024, primarily due to a $0.5 million decrease in commercial properties[4] - Total occupancy rate was 78% as of June 30, 2024, with multifamily properties at 93% occupancy and commercial properties at 48%[3] Expenses - General and administrative expenses dropped from $3.7 million in Q2 2023 to $1.6 million in Q2 2024, a reduction of approximately 57%[8] - Interest income decreased from $7.9 million in Q2 2023 to $4.8 million in Q2 2024, a decline of about 39%[8] Investments and Financing - Equity in income from unconsolidated joint ventures increased from $0.3 million in Q2 2023 to $0.5 million in Q2 2024, a growth of approximately 71%[8] - The company replaced an existing loan on Forest Grove with a new $6.6 million loan at SOFR plus 1.85%, maturing on July 10, 2031[3]

Financing Activities - The company paid off $67.5 million of Series C bonds on January 31, 2023[90]. - A $33.0 million construction loan was secured on March 15, 2023, for the development of a 240-unit multifamily property in Lake Wales, Florida, with an expected total cost of approximately $55.3 million[93]. - A $25.4 million construction loan was entered into on November 6, 2023, for the development of a 216-unit multifamily property in McKinney, Texas, with an expected total cost of approximately $51.9 million[94]. - A $23.5 million construction loan was secured on December 15, 2023, for the development of a 216-unit multifamily property in Temple, Texas, with an expected total cost of approximately $49.6 million[95]. - The company extended the maturity of its loan on Windmill Farms to February 28, 2026, at an interest rate of 7.50%[90]. - The company spent $3.2 million on reimbursable infrastructure investments during 2024[92]. Development Costs - The company has incurred a total of $25.1 million in development costs for the Alera project as of June 30, 2024[93]. - The company has incurred a total of $11.8 million in development costs for the Merano project as of June 30, 2024[94]. - The company has incurred a total of $6.2 million in development costs for the Bandera Ridge project as of June 30, 2024[95]. Revenue and Income - Multifamily segment revenue increased by $269 million to $7,927 million in 2024 compared to $7,658 million in 2023, while commercial segment revenue decreased by $470 million to $3,261 million[103]. - Net income for the three months ended June 30, 2024, was $1,491 million, an increase of $1,188 million compared to $303 million in the same period of 2023[103]. - Funds From Operations (FFO) for the six months ended June 30, 2024, was $9,365 million, compared to $10,251 million in 2023, reflecting a decrease of $886 million[118]. Cash Flow - Net cash provided by operating activities was $3,364 million for the six months ended June 30, 2024, a variance of $11,819 million compared to $(8,455) million in 2023[111]. - Cash used in financing activities decreased by $132.9 million to $(2,354) million in 2024, primarily due to the repayment of bonds in 2023[112]. - The company anticipates sufficient cash and cash equivalents to meet all cash requirements as of June 30, 2024[108]. Expenses - Interest income decreased by $2,537 million to $2,881 million in 2024, primarily due to lower interest rates on UHF notes and Pillar Receivable[105]. - General, administrative, and advisory expenses decreased by $2,578 million to $3,289 million in 2024, attributed to reduced legal and auditing costs[105]. Future Plans - The company plans to continue funding liquidity needs through property operations, sales, and refinancing of existing mortgage notes[107]. - The multifamily segment's profit increase was driven by a $0.4 million rise from the Redevelopment Property due to lease-up[106]. Property Transactions - The company reported no Acquisition Properties or Disposition Properties for the comparison of the three and six months ended June 30, 2024, to the same periods in 2023[102].

Financial Performance - Net income attributable to common shares decreased by $1.2 million from $3.0 million in Q1 2023 to $1.8 million in Q1 2024, representing a 40% decline [5]. - Total revenue increased by $0.2 million from $11.7 million in Q1 2023 to $11.9 million in Q1 2024, a growth of approximately 1.7% [8]. - Net operating loss decreased by $1.6 million from $3.1 million in Q1 2023 to $1.5 million in Q1 2024, a reduction of approximately 51.6% [4]. - Earnings per share decreased from $0.18 in Q1 2023 to $0.11 in Q1 2024, a decline of approximately 38.9% [8]. Revenue Sources - Rental revenues rose by $0.3 million from $11.0 million in Q1 2023 to $11.3 million in Q1 2024, primarily driven by a $0.7 million increase in multifamily properties [4]. - Interest income decreased from $8.3 million in Q1 2023 to $5.7 million in Q1 2024, a decline of about 31.1% [8]. - Equity in income from unconsolidated joint ventures decreased from $2.4 million in Q1 2023 to $0.5 million in Q1 2024 [8]. Expenses and Financial Management - General and administrative expenses decreased from $3.2 million in Q1 2023 to $1.4 million in Q1 2024, a reduction of approximately 55.6% [8]. - The company extended the maturity of its loan on Windmill Farms to February 28, 2026, at an interest rate of 7.50% [3]. Occupancy Rates - Total occupancy was reported at 79% as of March 31, 2024, with multifamily properties at 94% and commercial properties at 49% [3].

Revenue and Income - Multifamily segment revenue increased to $8.053 million in Q1 2024 from $7.373 million in Q1 2023, a growth of approximately 9.2%[105] - Commercial segment revenue decreased to $3.226 million in Q1 2024 from $3.636 million in Q1 2023, a decline of approximately 11.3%[105] - Net income for Q1 2024 was $2.302 million, down from $4.219 million in Q1 2023, representing a decrease of about 45.5%[105] - Net income for the three months ended March 31, 2024, decreased by $1.9 million compared to the same period in 2023, primarily due to a decline in occupancy at Browning Place in the commercial segment[107] - Funds From Operations (FFO) for the three months ended March 31, 2024, was $4.98 million, down from $6.13 million in the same period in 2023[116] - FFO adjusted for the three months ended March 31, 2024, was $4.98 million, compared to $5.16 million in the same period in 2023[116] Expenses - Operating expenses for the multifamily segment rose to $4.219 million in Q1 2024, up from $3.708 million in Q1 2023, an increase of about 13.8%[105] - General, administrative, and advisory expenses decreased to $3.610 million in Q1 2024 from $5.566 million in Q1 2023, a reduction of approximately 35.2%[105] - Interest income decreased to $3.811 million in Q1 2024 from $5.155 million in Q1 2023, a decline of about 26.0%[105] - The decrease in interest income was $2.6 million, partially offset by a $1.2 million decrease in interest expense due to changes in interest rates and repayment of bonds[107] Development and Financing - The company incurred $18.9 million in development costs for the Lake Wales multifamily property as of March 31, 2024, with total expected costs of approximately $55.3 million[95] - A $33.0 million construction loan was secured for the Lake Wales development, which is expected to be completed in 2025[95] - The company entered into a $25.4 million construction loan for the Merano development, expected to be completed in 2025[96] - A total of $24.3 million is allocated for the development of 470 land lots in Windmill Farms, with completion expected over a two-year period starting Q3 2024[94] - The net cash used in financing activities decreased significantly by $87.67 million, primarily due to the repayment of bonds in 2023[111] - The company plans to selectively sell land and income-producing assets and refinance existing real estate debt to meet liquidity requirements[109] Cash Flow - Cash provided by operating activities increased to $3.87 million in Q1 2024 from $1.54 million in Q1 2023, a variance of $2.33 million attributed to a decrease in interest payments[110] - The company anticipates that cash and cash equivalents as of March 31, 2024, will be sufficient to meet all cash requirements, supported by cash generated from notes receivable and short-term investments[109] - The cash flow from investing activities changed by $35.8 million, mainly due to a $51.1 million increase in net purchases of short-term investments[111] Profitability - The multifamily segment saw a profit increase of $0.1 million due to the lease-up of the Redevelopment Property[107]

Financial Performance - For Q4 2023, American Realty Investors, Inc. reported a net loss attributable to common shares of $2.1 million or $0.13 per diluted share, a significant decrease from a net income of $43.4 million or $2.69 per diluted share in Q4 2022 [2][5]. - Net operating income decreased by $3.6 million, resulting in a net operating loss of $2.2 million for Q4 2023, compared to a net operating income of $1.4 million in Q4 2022 [4]. - The decrease in net income was primarily due to a $72.6 million decrease in gain on sale, remeasurement, or write-down of assets [5]. - Total revenue for Q4 2023 was $14.0 million, up from $13.3 million in Q4 2022 [8]. Occupancy and Rental Revenue - Total occupancy was 77% as of December 31, 2023, with multifamily properties at 92% and commercial properties at 49% [3]. - Rental revenues increased by $1.0 million from $11.8 million in Q4 2022 to $12.8 million in Q4 2023, primarily driven by a $0.9 million increase in multifamily properties [4]. - Property operating expenses increased by $1.5 million from $5.8 million in Q4 2022 to $7.3 million in Q4 2023 [8]. Construction and Financing - The company entered into a $25.4 million construction loan for a 216-unit multifamily property in McKinney, Texas, expected to be completed in 2025 [3]. - A second construction loan of $23.5 million was secured for another 216-unit multifamily property in Temple, Texas, also expected to be completed in 2025 [3]. - The company extended the maturity of its loan on Windmill Farms to February 28, 2026, at an interest rate of 7.50% [3].