```markdown PART I. FINANCIAL INFORMATION [ITEM 1. Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) This section presents unaudited condensed consolidated financial statements for Q1 2023 and 2022, including balance sheets, statements of operations, comprehensive loss, capital, and cash flows, with detailed notes [Unaudited Condensed Consolidated Balance Sheets](index=4&type=page&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Balance sheets show slight asset and capital decrease, marginal liability increase, with inventories and notes payable as key items | Metric (in thousands) | March 31, 2023 | December 31, 2022 | | :-------------------- | :------------- | :---------------- | | **ASSETS** | | | | INVENTORIES | $2,260,595 | $2,239,125 | | CASH AND CASH EQUIVALENTS | $106,577 | $131,771 | | TOTAL ASSETS | $2,878,482 | $2,885,784 | | **LIABILITIES** | | | | Notes payable, net | $621,035 | $620,651 | | Total liabilities | $996,681 | $992,737 | | **CAPITAL** | | | | Total capital | $1,856,801 | $1,868,047 | [Unaudited Condensed Consolidated Statements of Operations](index=5&type=page&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Net loss significantly reduced in Q1 2023 due to lower costs, reduced restructuring, and improved equity earnings | Metric (in thousands, except per share) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :------------------------------------ | :-------------------------------- | :-------------------------------- | | Total revenues | $5,701 | $4,886 | | Total costs and expenses | $17,290 | $40,751 |\ | Equity in earnings (loss) from unconsolidated entities | $1,048 | $(1,032) | | Net loss | $(9,734) | $(36,769) | | Net loss attributable to the Company | $(4,536) | $(17,130) | | Basic Net Loss per Class A Share | $(0.07) | $(0.25) | [Unaudited Condensed Consolidated Statements of Comprehensive Loss](index=6&type=page&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Comprehensive loss significantly decreased in Q1 2023, primarily reflecting the reduction in net loss from the prior year | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Net loss | $(9,734) | $(36,769) | | Other comprehensive income | $41 | $13 |\ | Comprehensive loss | $(9,693) | $(36,756) | | Comprehensive loss attributable to the Company | $(4,510) | $(17,122) | [Unaudited Condensed Consolidated Statements of Capital](index=7&type=page&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Capital) Total capital decreased from December 2022 to March 2023, mainly due to net loss, partially offset by share-based compensation | Metric (in thousands) | December 31, 2022 | March 31, 2023 | | :-------------------- | :---------------- | :------------- | | Total Members' Capital | $618,131 | $614,590 | | Noncontrolling Interests | $1,249,916 | $1,242,211 | | Total Capital | $1,868,047 | $1,856,801 | - Net loss attributable to the Company for the three months ended March 31, 2023, was **$(4,536) thousand**, contributing to the decrease in retained earnings[23](index=23&type=chunk) - Share-based compensation expense of **$763 thousand** increased contributed capital during the period[23](index=23&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=8&type=page&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities significantly reduced in Q1 2023, driven by lower net loss and favorable changes | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Net cash used in operating activities | $(21,638) | $(57,969) | | Net cash provided by investing activities | $68 | $484 | | Net cash used in financing activities | $(3,624) | $(4,330) | | Net decrease in cash, cash equivalents, and restricted cash | $(25,194) | $(61,815) | | Cash, cash equivalents, and restricted cash—End of period | $107,569 | $204,977 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=page&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes provide detailed explanations of business, accounting policies, segment performance, related party transactions, debt, and commitments [1. BUSINESS AND ORGANIZATION](index=9&type=page&id=1.%20BUSINESS%20AND%20ORGANIZATION) Five Point Holdings develops mixed-use communities in California via Five Point Operating Company, LP, with Class A/B shares and noncontrolling interests - The Company owns and develops mixed-use planned communities in California through Five Point Operating Company, LP[28](index=28&type=chunk) - As of March 31, 2023, the Company owned approximately **62.6%** of the outstanding Class A Common Units of the Operating Company[32](index=32&type=chunk) - Noncontrolling interests represent equity interests in consolidated subsidiaries held by partners in the Operating Company and members in The San Francisco Venture[30](index=30&type=chunk) [2. BASIS OF PRESENTATION](index=10&type=page&id=2.%20BASIS%20OF%20PRESENTATION) Unaudited financial statements prepared under U.S. GAAP consolidate controlled entities and VIEs, relying on management estimates - Condensed consolidated financial statements are unaudited and prepared in accordance with U.S. GAAP for interim financial information[35](index=35&type=chunk) - The Company consolidates entities where it has a controlling interest or is the primary beneficiary of a Variable Interest Entity (VIE)[34](index=34&type=chunk) [3. REVENUES](index=11&type=page&id=3.%20REVENUES) Total revenues increased by **16.7%** to **$5.7 million** in Q1 2023, primarily from higher management services revenue in the Great Park segment | Revenue Source (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :---------------------------- | :-------------------------------- | :-------------------------------- | | Land sales | $(25) | $557 | | Land sales—related party | $624 | $1 | | Management services—related party | $4,236 | $3,547 | | Operating properties | $866 | $781 | | **Total revenues** | **$5,701** | **$4,886** | - The increase in total revenues was primarily due to a **$689 thousand** increase in management services—related party revenue[38](index=38&type=chunk) [4. INVESTMENT IN UNCONSOLIDATED ENTITIES](index=12&type=page&id=4.%20INVESTMENT%20IN%20UNCONSOLIDATED%20ENTITIES) Investments in Great Park, Gateway Commercial, and Valencia Landbank Ventures are equity method accounted, with Great Park improving net income [Great Park Venture](index=12&type=page&id=Great%20Park%20Venture) Great Park Venture, **37.5%** owned, recognized significant land sale revenues in Q1 2023, shifting to net income and improving equity earnings | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Land sale and related party land sale revenues | $8,600 | $1,819 | | Net income (loss) of Great Park Venture | $2,743 | $(2,831) | | Equity in earnings (loss) from Great Park Venture | $1,162 | $(1,301) | - The Great Park Venture recognized **$5.5 million** in land sale revenues to related parties and **$3.1 million** to third parties in Q1 2023[42](index=42&type=chunk) [Gateway Commercial Venture](index=13&type=page&id=Gateway%20Commercial%20Venture) Gateway Commercial Venture, **75%** owned, reported a net loss in Q1 2023, a decline from prior year's net income despite increased rental revenues | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Rental revenues | $2,154 | $1,938 | | Net (loss) income of Gateway Commercial Venture | $(283) | $112 | | Equity in (loss) earnings from Gateway Commercial Venture | $(212) | $84 | [Valencia Landbank Venture](index=13&type=page&id=Valencia%20Landbank%20Venture) Valencia Landbank Venture, a **10%** equity method investee, generated **$0.1 million** in equity earnings for Q1 2023 - The Company's investment in the Valencia Landbank Venture was **$1.9 million** at March 31, 2023, and it recognized **$0.1 million** in equity in earnings for the three months ended March 31, 2023[47](index=47&type=chunk) [5. NONCONTROLLING INTERESTS](index=14&type=page&id=5.%20NONCONTROLLING%20INTERESTS) Noncontrolling interests relate to Operating Company and San Francisco Venture, with Holding Company ownership increasing to **62.6%** due to share-based compensation - The Holding Company owned approximately **62.6%** of the outstanding Class A Common Units of the Operating Company as of March 31, 2023[48](index=48&type=chunk) - Tax distributions to partners of the Operating Company totaled **$1.974 million** for the three months ended March 31, 2023, up from **$435 thousand** in the prior year[53](index=53&type=chunk) - A redeemable noncontrolling interest of **$25.0 million** in Class C units of The San Francisco Venture was outstanding at March 31, 2023[57](index=57&type=chunk) [6. CONSOLIDATED VARIABLE INTEREST ENTITY](index=15&type=page&id=6.%20CONSOLIDATED%20VARIABLE%20INTEREST%20ENTITY) Operating Company, San Francisco Venture, FP LP, and FPL are consolidated VIEs, with significant inventories and non-recourse liabilities - The Operating Company, The San Francisco Venture, FP LP, and FPL are consolidated VIEs[58](index=58&type=chunk)[64](index=64&type=chunk) | San Francisco Venture (in thousands) | March 31, 2023 | December 31, 2022 | | :----------------------------------- | :------------- | :---------------- | | Total combined assets | $1,330,000 | $1,310,000 | | Inventories | $1,320,000 | $1,310,000 | | Total combined liabilities | $68,300 | $67,300 | | FP LP and FPL (in thousands) | March 31, 2023 | December 31, 2022 | | :--------------------------- | :------------- | :---------------- | | Total combined assets | $1,100,000 | $1,100,000 | | Inventories | $936,700 | $927,900 | | Total combined liabilities | $76,100 | $77,200 | [7. INTANGIBLE ASSET, NET—RELATED PARTY](index=16&type=page&id=7.%20INTANGIBLE%20ASSET,%20NET%E2%80%94RELATED%20PARTY) Intangible asset, representing Great Park Venture incentive compensation, slightly decreased due to amortization expense recognized in Q1 2023 | Metric (in thousands) | March 31, 2023 | December 31, 2022 | | :-------------------- | :------------- | :---------------- | | Gross carrying amount | $129,705 | $129,705 | | Accumulated amortization | $(90,095) | $(89,448) | | Net book value | $39,610 | $40,257 | - Intangible asset amortization expense was **$0.6 million** for the three months ended March 31, 2023, included in the cost of management services[68](index=68&type=chunk) [8. RELATED PARTY TRANSACTIONS](index=17&type=page&id=8.%20RELATED%20PARTY%20TRANSACTIONS) Related party assets and liabilities remained stable, with contract assets and management fee revenues from Great Park Venture increasing | Related Party (in thousands) | March 31, 2023 | December 31, 2022 | | :--------------------------- | :------------- | :---------------- | | **Assets:** | | | | Contract assets | $80,414 | $79,863 | | Total Related Party Assets | $97,114 | $97,126 | | **Liabilities:** | | | | Reimbursement obligation | $61,542 | $62,990 | | Accrued advisory fees | $9,075 | $10,525 | | Total Related Party Liabilities | $90,628 | $93,086 | - Management fee revenues under the A&R DMA with the Great Park Venture were **$4.1 million** for Q1 2023, up from **$3.4 million** in Q1 2022[71](index=71&type=chunk) [9. NOTES PAYABLE, NET](index=17&type=page&id=9.%20NOTES%20PAYABLE,%20NET) Notes payable, net, primarily comprise **7.875% Senior Notes due 2025**, with no borrowings on the **$125.0 million** revolving credit facility | Metric (in thousands) | March 31, 2023 | December 31, 2022 | | :-------------------- | :------------- | :---------------- | | 7.875% Senior Notes due 2025 | $625,000 | $625,000 | | Unamortized debt issuance costs and discount | $(3,965) | $(4,349) | | Notes payable, net | $621,035 | $620,651 | - No borrowings or letters of credit were outstanding on the Operating Company's **$125.0 million** unsecured revolving credit facility as of March 31, 2023[73](index=73&type=chunk) [10. TAX RECEIVABLE AGREEMENT](index=18&type=page&id=10.%20TAX%20RECEIVABLE%20AGREEMENT) A Tax Receivable Agreement (TRA) liability of **$173.2 million** exists, with no payments made or expected for several years | Metric (in thousands) | March 31, 2023 | December 31, 2022 | | :-------------------- | :------------- | :---------------- | | Payable pursuant to tax receivable agreement | $173,208 | $173,068 | - No TRA payments were made during the three months ended March 31, 2023 or 2022[74](index=74&type=chunk) - The company does not expect to make any TRA payments for the next several years based on current projections[163](index=163&type=chunk) [11. COMMITMENTS AND CONTINGENCIES](index=18&type=page&id=11.%20COMMITMENTS%20AND%20CONTINGENCIES) Commitments and contingencies include performance bonds, San Francisco Venture guarantees, and ongoing legal proceedings like Hunters Point Litigation [Performance and Completion Bonding Agreements](index=18&type=page&id=Performance%20and%20Completion%20Bonding%20Agreements) Outstanding performance bonds totaled **$320.0 million** as of March 31, 2023, primarily for Valencia community development obligations | Metric (in millions) | March 31, 2023 | December 31, 2022 | | :------------------- | :------------- | :---------------- | | Outstanding performance bonds | $320.0 | $315.0 | [Candlestick and The San Francisco Shipyard Disposition and Development Agreement](index=18&type=page&id=Candlestick%20and%20The%20San%20Francisco%20Shipyard%20Disposition%20and%20Development%20Agreement) San Francisco Venture has **$198.3 million** in outstanding guarantees for infrastructure and park obligations at Candlestick and The San Francisco Shipyard - The San Francisco Venture had outstanding guarantees of **$198.3 million** for infrastructure and park obligations as of March 31, 2023[78](index=78&type=chunk) [Letters of Credit](index=18&type=page&id=Letters%20of%20Credit) Outstanding letters of credit and restricted cash pledged as collateral each totaled **$1.0 million** as of March 31, 2023 | Metric (in millions) | March 31, 2023 | December 31, 2022 | | :------------------- | :------------- | :---------------- | | Outstanding letters of credit | $1.0 | $1.0 | | Restricted cash and certificates of deposit | $1.0 | $1.0 | [Legal Proceedings](index=18&type=page&id=Legal%20Proceedings) The company is a defendant in the Bayview Action lawsuit regarding alleged contamination at The San Francisco Shipyard, asserting strong defenses - The Bayview Action lawsuit alleges fraudulent misrepresentation of test results and remediation efforts by Tetra Tech at The San Francisco Shipyard, naming the Company as a defendant[80](index=80&type=chunk)[82](index=82&type=chunk) - Management believes it has meritorious defenses and potential insurance/indemnification rights regarding the Bayview Action[82](index=82&type=chunk) [Environmental Contamination](index=20&type=page&id=Environmental%20Contamination) Environmental contamination may require corrective action, but the company does not anticipate a material adverse effect on financial statements - The Company believes that any potential corrective actions for environmental contamination would not have a material adverse effect on its condensed consolidated financial statements[84](index=84&type=chunk) [12. SUPPLEMENTAL CASH FLOW INFORMATION](index=20&type=page&id=12.%20SUPPLEMENTAL%20CASH%20FLOW%20INFORMATION) Supplemental cash flow includes capitalized interest and noncash lease expense, with a reconciliation showing decreased total cash balances | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Cash paid for interest (capitalized) | $706 | $776 | | Noncash lease expense | $1,116 | $1,301 | | Cash Reconciliation (in thousands) | March 31, 2023 | March 31, 2022 | | :--------------------------------- | :------------- | :------------- | | Cash and cash equivalents | $106,577 | $203,647 | | Restricted cash and certificates of deposit | $992 | $1,330 | | Total cash, cash equivalents, and restricted cash | $107,569 | $204,977 | [13. SEGMENT REPORTING](index=20&type=page&id=13.%20SEGMENT%20REPORTING) The company operates four segments: Valencia, San Francisco, Great Park, and Commercial, focusing on mixed-use developments and showing Great Park profit improvement - The company's reportable segments are Valencia, San Francisco, Great Park, and Commercial[87](index=87&type=chunk)[88](index=88&type=chunk)[89](index=89&type=chunk)[91](index=91&type=chunk) | Segment Operating Results (in thousands) | Revenues (Q1 2023) | Revenues (Q1 2022) | Profit (Loss) (Q1 2023) | Profit (Loss) (Q1 2022) | | :--------------------------------------- | :----------------- | :----------------- | :---------------------- | :---------------------- | | Valencia | $1,303 | $1,159 | $(2,439) | $(4,827) | | San Francisco | $162 | $180 | $(1,030) | $(669) | | Great Park | $12,729 | $22,424 | $4,506 | $(2,071) | | Commercial | $2,261 | $2,041 | $(176) | $215 | | Total reportable segments | $16,455 | $25,804 | $861 | $(7,352) | [14. SHARE-BASED COMPENSATION](index=22&type=page&id=14.%20SHARE-BASED%20COMPENSATION) Share-based compensation expense significantly decreased in Q1 2023 due to prior year's restructuring expense, while nonvested awards increased | Share-Based Compensation (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------------------------- | :-------------------------------- | :-------------------------------- | | Share-based compensation expense | $763 | $4,103 | | Share-Based Awards Activity (in thousands) | Nonvested at Jan 1, 2023 | Granted | Vested | Nonvested at Mar 31, 2023 | | :----------------------------------------- | :----------------------- | :------ | :----- | :------------------------ | | Share-Based Awards | 2,166 | 3,040 | (636) | 4,570 | - In Q1 2022, **$3.0 million** of share-based compensation expense was included in restructuring expense due to a modification of awards for two former officers[97](index=97&type=chunk) [15. EMPLOYEE BENEFIT PLANS](index=22&type=page&id=15.%20EMPLOYEE%20BENEFIT%20PLANS) The frozen defined benefit Retirement Plan generated a net periodic cost in Q1 2023, shifting from a net benefit due to higher interest cost | Net Periodic Cost (Benefit) (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :----------------------------------------- | :-------------------------------- | :-------------------------------- | | Interest cost | $202 | $136 | | Expected return on plan assets | $(222) | $(261) | | Amortization of net actuarial loss | $41 | $13 | | Net periodic cost (benefit) | $21 | $(112) | [16. INCOME TAXES](index=23&type=page&id=16.%20INCOME%20TAXES) Despite pre-tax losses, a minimal income tax provision was recorded due to a valuation allowance against deferred tax assets and pass-through entity structure | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Loss before income tax provision | $(9,726) | $(36,764) | | Income tax provision | $(8) | $(5) | - The Company continues to record a valuation allowance against its federal and state net deferred tax assets due to a history of book losses[103](index=103&type=chunk) [17. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS AND DISCLOSURES](index=23&type=page&id=17.%20FINANCIAL%20INSTRUMENTS%20AND%20FAIR%20VALUE%20MEASUREMENTS%20AND%20DISCLOSURES) Most financial instruments' carrying amounts approximated fair value, but notes payable, net, had a significantly lower fair value than carrying value - The carrying amount of most financial instruments (cash, restricted cash, certain related party assets/liabilities, accounts payable) approximated fair value[104](index=104&type=chunk) | Notes Payable, Net (in millions) | March 31, 2023 | December 31, 2022 | | :------------------------------- | :------------- | :---------------- | | Estimated fair value | $563.8 | $525.5 | | Carrying value | $621.0 | $620.7 | [18. EARNINGS PER SHARE](index=24&type=page&id=18.%20EARNINGS%20PER%20SHARE) Using the two-class method, basic and diluted loss per Class A share significantly decreased in Q1 2023 compared to Q1 2022 | Metric (per share) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :----------------- | :-------------------------------- | :-------------------------------- | | Basic loss per Class A common share | $(0.07) | $(0.25) | | Diluted loss per Class A common share | $(0.07) | $(0.25) | - No distributions on common shares were declared for the three months ended March 31, 2023 or 2022[107](index=107&type=chunk) [19. ACCUMULATED OTHER COMPREHENSIVE LOSS](index=25&type=page&id=19.%20ACCUMULATED%20OTHER%20COMPREHENSIVE%20LOSS) Accumulated other comprehensive loss attributable to the Company remained stable at **$3.0 million**, primarily from unamortized pension plan actuarial losses | Metric (in millions) | March 31, 2023 | December 31, 2022 | | :------------------- | :------------- | :---------------- | | Accumulated other comprehensive loss attributable to the Company | $3.0 | $3.0 | - Reclassifications from accumulated other comprehensive loss to net loss related to amortization of net actuarial losses were approximately **$25,000** for Q1 2023[110](index=110&type=chunk) [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2023 financial performance, focusing on revenue, capital, and cost control, leading to improved results and reduced net loss [Forward-Looking Statements](index=26&type=page&id=Forward-Looking%20Statements) This section reiterates the cautionary statement on forward-looking statements, noting actual results may differ due to risks and uncertainties - The discussion contains forward-looking statements subject to risks and uncertainties, and actual results could differ materially[112](index=112&type=chunk) [Overview](index=26&type=page&id=Overview) The company operates through Five Point Operating Company, LP (**62.6%** owned), consolidating most entities but equity accounting for Great Park and Gateway Commercial Ventures - The company operates through Five Point Operating Company, LP, owning approximately **62.6%** as of March 31, 2023[113](index=113&type=chunk) - The operating company consolidates Five Point Land, LLC and The Shipyard Communities, LLC, but accounts for Great Park Venture and Gateway Commercial Venture using the equity method[113](index=113&type=chunk) [Operational Highlights](index=26&type=page&id=Operational%20Highlights) Q1 2023 focus on revenue, capital, and cost control led to an **18%** SG&A reduction, increased homebuyer activity, and **$231.6 million** in total liquidity - The company's three main priorities are generating revenue and positive cash flow, managing capital spend, and managing selling, general and administrative costs[114](index=114&type=chunk) - Selling, general and administrative costs decreased by **18%** in Q1 2023 compared to Q1 2022[114](index=114&type=chunk) - Home sales at Valencia increased to **75 homes** in Q1 2023 from **49** in Q4 2022, and at Great Park Neighborhoods to **255 homes** from **113**[115](index=115&type=chunk) - Total liquidity as of March 31, 2023, was **$231.6 million**, comprising **$106.6 million** in cash and **$125.0 million** available under the revolving credit facility[116](index=116&type=chunk) [Results of Operations](index=27&type=page&id=Results%20of%20Operations) Q1 2023 financial results significantly improved with reduced net loss, driven by increased revenues, decreased restructuring costs, and positive equity earnings | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Total revenues | $5,701 | $4,886 | | Total costs and expenses | $17,290 | $40,751 | | Net loss attributable to the company | $(4,536) | $(17,130) | [Revenues](index=28&type=page&id=Revenues) Total revenues increased by **$0.8 million (16.7%)** in Q1 2023, primarily due to higher management services revenue from the Great Park segment - Revenues increased by **$0.8 million (16.7%)** to **$5.7 million** in Q1 2023, mainly due to increased management services revenue at the Great Park segment[120](index=120&type=chunk) [Selling, general, and administrative](index=28&type=page&id=Selling,%20general,%20and%20administrative) SG&A expenses decreased by **$3.0 million (18.1%)** in Q1 2023, driven by reduced employee and marketing costs following a **38%** headcount reduction - Selling, general, and administrative expenses decreased by **$3.0 million (18.1%)** to **$13.8 million** in Q1 2023[121](index=121&type=chunk) - The decrease was mainly due to reductions in employee-related and selling and marketing expenses, following an approximately **38%** headcount reduction since the end of 2021[121](index=121&type=chunk) [Restructuring](index=28&type=page&id=Restructuring) No restructuring costs in Q1 2023, a significant reduction from **$19.4 million** in Q1 2022, which included advisory payments and share-based compensation - Restructuring costs were **$0** in Q1 2023, down from **$19.437 million** in Q1 2022[18](index=18&type=chunk) - Q1 2022 restructuring costs included a **$15.6 million** related party liability for advisory agreement payments and **$3.0 million** in share-based compensation expense due to executive management changes[122](index=122&type=chunk) - An additional **$0.9 million** in severance benefits from layoffs was incurred in Q1 2022[123](index=123&type=chunk) [Equity in earnings (loss) from unconsolidated entities](index=28&type=page&id=Equity%20in%20earnings%20(loss)%20from%20unconsolidated%20entities) Equity in earnings from unconsolidated entities shifted from a **$1.0 million** loss in Q1 2022 to a **$1.0 million** gain in Q1 2023, driven by Great Park Venture's net income - Equity in earnings from unconsolidated entities increased to **$1.0 million** in Q1 2023 from a loss of **$1.0 million** in Q1 2022[125](index=125&type=chunk) - This increase was primarily driven by the Great Park Venture recognizing net income in Q1 2023 compared to a net loss in Q1 2022[125](index=125&type=chunk) [Income taxes](index=28&type=page&id=Income%20taxes) Minimal income tax provision recorded in Q1 2023 and Q1 2022 despite pre-tax losses, due to valuation allowance against deferred tax assets - Pre-tax losses of **$9.7 million** (Q1 2023) and **$36.8 million** (Q1 2022) resulted in no tax benefit due to the application of a valuation allowance[126](index=126&type=chunk) - The effective tax rate, before changes in valuation allowance, was substantially similar for both periods[126](index=126&type=chunk) [Net loss attributable to noncontrolling interests](index=28&type=page&id=Net%20loss%20attributable%20to%20noncontrolling%20interests) Net loss attributable to noncontrolling interests significantly decreased in Q1 2023, reflecting the overall reduction in the company's net loss | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Net loss attributable to noncontrolling interests | $(5,198) | $(19,639) | - Noncontrolling interests represent interests held by other partners in the operating company and members of The San Francisco Venture[127](index=127&type=chunk) [Segment Results and Financial Information](index=29&type=page&id=Segment%20Results%20and%20Financial%20Information) Four segments (Valencia, San Francisco, Great Park, Commercial) show varied performance, with Great Park improving profit and Commercial shifting to loss - The Great Park segment reported a profit of **$4.5 million** in Q1 2023, a significant improvement from a **$2.1 million** loss in Q1 2022[92](index=92&type=chunk) - The Valencia segment's loss decreased to **$2.4 million** in Q1 2023 from **$4.8 million** in Q1 2022[92](index=92&type=chunk) - The Commercial segment shifted from a **$215 thousand** profit in Q1 2022 to a **$176 thousand** loss in Q1 2023[92](index=92&type=chunk) [Valencia Segment](index=30&type=page&id=Valencia%20Segment) Valencia segment's SG&A expenses decreased by **40.4%** in Q1 2023 due to lower marketing and employee-related costs for its mixed-use community - The Valencia property is designed to include approximately **21,500 homesites** and **11.5 million square feet** of commercial space[133](index=133&type=chunk) - Selling, general, and administrative expenses for the Valencia segment decreased by **$1.8 million (40.4%)** to **$2.6 million** in Q1 2023[134](index=134&type=chunk) [San Francisco Segment](index=31&type=page&id=San%20Francisco%20Segment) San Francisco segment's Candlestick and Shipyard development is exempt from Proposition M, but land transfers are delayed by environmental retesting and litigation - Candlestick and The San Francisco Shipyard are designed to include approximately **12,000 homesites** and **6.3 million square feet** of commercial space[135](index=135&type=chunk)[137](index=137&type=chunk) - Development at Candlestick and The San Francisco Shipyard is not subject to San Francisco's Proposition M growth control measure[137](index=137&type=chunk) - Land transfers from the U.S. Navy are delayed due to allegations of misrepresented sampling results by contractors and subsequent retesting efforts[138](index=138&type=chunk) [Great Park Segment](index=31&type=page&id=Great%20Park%20Segment) Great Park segment saw significant increases in land sales and management fees in Q1 2023, alongside decreased SG&A expenses - The Great Park Neighborhoods is designed to include approximately **10,500 homesites** and **4.9 million square feet** of commercial space[141](index=141&type=chunk) - Land sales and related party land sales revenues increased to **$8.6 million** in Q1 2023 from **$1.8 million** in Q1 2022, primarily due to an increase in profit participation[143](index=143&type=chunk) - Management fees—related party increased by **$3.0 million (196.7%)** to **$4.5 million** in Q1 2023, mainly due to a higher annual base fee of **$12.0 million**[148](index=148&type=chunk) - Selling, general, and administrative expenses decreased by **$4.2 million (56.0%)** to **$3.3 million** in Q1 2023, due to lower marketing expenses and the elimination of a variable cost reimbursement component[147](index=147&type=chunk) [Commercial Segment](index=33&type=page&id=Commercial%20Segment) Commercial segment, including Gateway Commercial Venture (**75%** owned), reported a loss in Q1 2023, with limited control due to unanimous approval requirements - The Gateway Commercial Venture owns one commercial office building and approximately **50 acres** of commercial land with additional development rights at the Five Point Gateway Campus[152](index=152&type=chunk) | Metric (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------- | :-------------------------------- | :-------------------------------- | | Segment (loss) profit from operations | $(176) | $215 | | Equity in (loss) earnings from the Gateway Commercial Venture | $(212) | $84 | [Liquidity and Capital Resources](index=33&type=page&id=Liquidity%20and%20Capital%20Resources) The company had **$106.6 million** cash and **$125.0 million** credit facility available, with short-term needs for development and long-term needs for horizontal development - As of March 31, 2023, the company had **$106.6 million** in consolidated cash and cash equivalents and **$125.0 million** available under its revolving credit facility[155](index=155&type=chunk) - Short-term cash needs include general and administrative expenses, development expenditures at Valencia and San Francisco, interest payments, and related party reimbursement obligations[156](index=156&type=chunk) - Approximately **$9.0 million** in related party reimbursement obligations were deferred from Q1 2023 to Q1 2024[156](index=156&type=chunk) - Long-term cash needs primarily relate to future horizontal development expenditures and investments in income-producing properties[158](index=158&type=chunk) [Summary of Cash Flows](index=34&type=page&id=Summary%20of%20Cash%20Flows) Net cash used in operating activities significantly decreased in Q1 2023, partially offset by public financing reimbursements | Cash Flow Activity (in thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Operating activities | $(21,638) | $(57,969) | | Investing activities | $68 | $484 | | Financing activities | $(3,624) | $(4,330) | - Net cash used in operating activities decreased by **$36.3 million** in Q1 2023, partially offset by **$17.7 million** in public financing reimbursements in Valencia[164](index=164&type=chunk) - Financing activities included **$0.2 million** for share-based compensation tax withholding and **$2.0 million** for noncontrolling interest tax distributions in Q1 2023[167](index=167&type=chunk) [Changes in Capital Structure](index=36&type=page&id=Changes%20in%20Capital%20Structure) Company ownership in the operating company increased to **62.6%** in Q1 2023 due to share-based compensation, with details on outstanding Class A and B units - The company's ownership percentage in the operating company increased to **62.6%** during Q1 2023[168](index=168&type=chunk) | Class A Units (in shares) | March 31, 2023 | December 31, 2022 | | :------------------------ | :------------- | :---------------- | | Held by us | 69,199,938 | 69,068,354 | | Held by noncontrolling interest members (Operating Company) | 41,363,271 | 41,363,271 | | Class A units of The San Francisco Venture held by noncontrolling interest members | 37,870,273 | 37,870,273 | - As of March 31, 2023, **79,233,544 Class B common shares** were outstanding, held by noncontrolling interest members, convertible to Class A common shares at a **0.0003 ratio**[170](index=170&type=chunk) [Critical Accounting Estimates](index=36&type=page&id=Critical%20Accounting%20Estimates) No significant changes to critical accounting estimates occurred in Q1 2023 compared to those disclosed in the Annual Report on Form 10-K - No significant changes to critical accounting estimates occurred during the three months ended March 31, 2023[171](index=171&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Primary market risk stems from **$621.0 million** fixed-rate indebtedness; no derivative financial instruments are currently used, but swaps may be considered - The company's primary market risk results from its indebtedness, which bears interest at fixed rates[172](index=172&type=chunk) - As of March 31, 2023, outstanding consolidated net indebtedness was **$621.0 million**, none of which bears interest based on floating rates[173](index=173&type=chunk) - The company has not entered into any transactions using derivative financial instruments[173](index=173&type=chunk) [ITEM 4. Controls and Procedures](index=36&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of March 31, 2023, with no material changes in internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=36&type=page&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) Certifying Officers concluded disclosure controls and procedures were effective as of March 31, 2023, ensuring timely and accurate reporting - Disclosure controls and procedures were evaluated and deemed effective as of March 31, 2023[175](index=175&type=chunk) [Changes in Internal Control Over Financial Reporting](index=37&type=page&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) No material changes in internal control over financial reporting were identified during the period - No material changes in internal control over financial reporting were identified during the period[176](index=176&type=chunk) PART II. OTHER INFORMATION [ITEM 1. Legal Proceedings](index=38&type=section&id=ITEM%201.%20Legal%20Proceedings) This section refers to Note 11 for disclosures on legal proceedings, including the ongoing Hunters Point Litigation - Disclosures of legal proceedings are incorporated by reference from Note 11 to the condensed consolidated financial statements[179](index=179&type=chunk) [ITEM 1A. Risk Factors](index=38&type=page&id=ITEM%201A.%20Risk%20Factors) Readers are referred to the Annual Report on Form 10-K for risk factors, with no material changes reported - Readers should consider risk factors discussed in the Annual Report on Form 10-K for the year ended December 31, 2022[180](index=180&type=chunk) - There have been no material changes in risk factors from those disclosed in the Annual Report on Form 10-K[180](index=180&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased **83,660 Class A common shares** in January 2023 at **$2.41** per share to settle employee tax withholding obligations | Period | Total number of shares purchased | Average price paid per share | | :---------------------- | :------------------------------- | :--------------------------- | | January 1, 2023 to January 31, 2023 | 83,660 | $2.41 | | Total | 83,660 | $2.41 | - Shares were repurchased to settle tax withholding obligations of employees upon vesting of restricted shares[181](index=181&type=chunk) [ITEM 3. Defaults Upon Senior Securities](index=38&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported during the period - No defaults upon senior securities occurred[182](index=182&type=chunk) [ITEM 4. Mine Safety Disclosures](index=38&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable - This item is not applicable[182](index=182&type=chunk) [ITEM 5. Other Information](index=38&type=section&id=ITEM%205.%20Other%20Information) No other information was reported for this item - No other information was reported[182](index=182&type=chunk) [ITEM 6. Exhibits](index=39&type=section&id=ITEM%206.%20Exhibits) Exhibits filed with Form 10-Q include certifications from CEO and CFO, and Inline XBRL documents - Exhibits include certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[183](index=183&type=chunk) - Inline XBRL documents for the instance, schema, calculation, definition, label, and presentation linkbases are also filed[183](index=183&type=chunk) [Signatures](index=40&type=section&id=Signatures) The report was signed by Daniel Hedigan, CEO, and Leo Kij, Interim CFO, on April 21, 2023 - The report was signed by Daniel Hedigan, Chief Executive Officer, and Leo Kij, Interim Chief Financial Officer, on April 21, 2023[186](index=186&type=chunk) ```

Financial Data and Key Metrics Changes - The company reported a consolidated net loss of $9.7 million for the quarter, with revenue of $5.7 million primarily from management services [2][11] - Selling, general and administrative (SG&A) expenses were $13.8 million, an 18% decrease or $3 million compared to the same quarter last year [3][11] - Total liquidity at quarter end was $231.6 million, consisting of $106.6 million in cash and cash equivalents and $125 million in available borrowing capacity [7][13] - The debt to total capitalization ratio was stable at 25.2%, with a net debt to capitalization ratio of 21.8% after accounting for cash [8][13] Business Line Data and Key Metrics Changes - The Great Park segment reported net income of $4.5 million, with $4.1 million in management fee revenues [40][41] - The Valencia segment recognized a loss of $2.4 million, primarily due to SG&A expenses related to employee compensation and marketing [51] - The Commercial segment had a net loss of approximately $200,000 for the quarter [45] Market Data and Key Metrics Changes - Home sales in the Great Park community increased significantly, with builders selling 255 homes in Q1, up from 113 in Q4 [26] - In Valencia, new home sales totaled 75 homes during the first quarter, an increase from 49 homes in the previous quarter [30] - The overall land market remained complicated, but there are signs of stabilization and increased interest in land acquisition as the banking crisis subsides [15][16] Company Strategy and Development Direction - The company aims to focus on generating revenue, managing capital expenditures, and reducing SG&A while adapting to market conditions [1][20] - There is a strategic emphasis on cash generation from various sources, including land sales and joint venture distributions [21][22] - The company plans to continue working with builders to sell land at prices that reflect current market conditions and the scarcity of entitled land [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future opportunities despite ongoing challenges such as interest rate increases and inflation [1] - The company anticipates substantial cash flow in the second quarter from land sales and expects to increase cash flow and bottom line throughout the year [12][34] - Management noted that builders are returning to the market, with competitive bidding for land, indicating a recovery in demand [65] Other Important Information - The company has deferred approximately $9 million of a reimbursement obligation to the first quarter of 2024, with expectations of further deferrals [6] - The Great Park Venture is a self-funding operation with no debt and a cash balance of $144 million at the end of the quarter [44] Q&A Session Summary Question: What kind of pressure are you seeing in your communities on pricing? - Management noted that builders are pricing homes to meet the market, with little concessions being given, especially in the Great Park [50] Question: Can you talk about what you're seeing on the cost on the development side? - Management indicated that land development costs are decreasing, with a recent rebid saving $0.5 million [59] Question: How do you plan to position your balance sheet ahead of the bond maturity in 2025? - Management emphasized a focus on maximizing cash position but did not specify a target for the balance sheet [70][76]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | --- | --- | --- | | Class A common shares | FPH | New York Stock Exchange | Securi ...

Financial Data and Key Metrics Changes - Consolidated net income for Q4 2022 was $22.5 million, with SG&A expenses reduced to $13.1 million, a decrease of $4.5 million compared to Q4 2021 [7][27] - Consolidated SG&A for the year was $54.6 million, reflecting a 29% reduction from 2021 [7] - Cash and cash equivalents at year-end stood at $131.8 million, with total liquidity of $256.8 million [14][38] Business Line Data and Key Metrics Changes - The Great Park segment reported net income of $93.7 million for the quarter, primarily from a commercial land sale of approximately 42 acres for $240 million [42][45] - The Valencia segment recognized a loss of $509,000 for the quarter, with no land sale closings but reported revenue of $3.8 million [40] - The San Francisco segment incurred a loss of $1.2 million, focusing on reassessing development plans [41] Market Data and Key Metrics Changes - Builders in the Great Park community sold 113 homes in Q4, up from 82 in Q3, totaling 326 homes sold for the year [16] - In Valencia, builders sold 49 homes in Q4, down from 166 in Q3, with a total of 594 homes sold for the year [19] - The company anticipates a transition year in residential markets, with ongoing demand for well-located homes despite current market pressures [11][12] Company Strategy and Development Direction - The company will focus on generating revenue, managing capital expenditures, and controlling SG&A to achieve net positive cash flow in 2023 [10][24] - The management team aims to capitalize on opportunities in commercial land sales and residential developments as the market stabilizes [11][12] - The renewal of the development management agreement with Great Park Venture through 2024 reflects the value added by the management team [9][37] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about 2023, acknowledging the challenges posed by rising interest rates and inflation on housing demand [31][32] - The company is focused on maintaining liquidity and is prepared to adjust plans proactively based on market conditions [32][77] - Management highlighted the importance of patience and strategic planning in navigating the current real estate market down cycle [10][11] Other Important Information - The company has no principal debt repayment obligations on senior notes in 2023 or 2024, with a stable debt-to-capitalization ratio of 25.1% [14][39] - The Great Park Venture is a self-funding operation with a cash balance of $149 million at the end of the quarter [46] Q&A Session Summary Question: Builder appetite for land and recent conversations - Management indicated that builders are re-engaging and showing interest in land purchases, with positive early signs for 2023 [51][54] Question: Cash balance in Great Park and distribution cadence - The cash balance in the Great Park partnership is $149 million, with distributions expected to align with land sales in the second half of the year [55][57] Question: Development expenses for Candlestick project - Management does not expect development expenses for the Candlestick project in 2023, with clarity on costs to come as plans progress [65] Question: Management agreement changes - The management agreement was extended without changes to the economic terms, focusing on continuity and key personnel [73][76] Question: Related party tax liability and liquidity - Management clarified that the Tax Receivable Agreement (TRA) is a projected obligation and does not currently affect bond payments [87]

PART I. FINANCIAL INFORMATION Presents unaudited condensed consolidated financial statements and management's discussion and analysis for Five Point Holdings, LLC [ITEM 1. Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) Presents unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive loss, capital, and cash flows, with detailed notes [Unaudited Condensed Consolidated Balance Sheets](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Details the company's financial position, showing a decrease in total assets and capital, primarily due to reduced cash and cash equivalents | Metric | Sep 30, 2022 (in thousands) | Dec 31, 2021 (in thousands) | Change (vs. Dec 31, 2021) | | :----------------------------- | :-------------------------- | :-------------------------- | :------------------------ | | Total Assets | $2,885,093 | $2,942,910 | $(57,817) | | Inventories | $2,229,525 | $2,096,824 | $132,701 | | Cash and Cash Equivalents | $86,379 | $265,462 | $(179,083) | | Total Liabilities | $1,013,610 | $1,017,532 | $(3,922) | | Total Capital | $1,846,483 | $1,900,378 | $(53,895) | [Unaudited Condensed Consolidated Statements of Operations](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Details the company's revenues, costs, and net loss for the three and nine months ended September 30, 2022 and 2021, showing a significant increase in net loss attributable to the company | Metric (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :-------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Total Revenues | $15,416 | $20,695 | $(5,279) | $25,695 | $42,179 | $(16,484) | | Total Costs & Expenses| $21,098 | $30,927 | $(9,829) | $79,078 | $89,311 | $(10,233) | | Net Loss | $(9,531) | $(8,210) | $(1,321) | $(57,272) | $(34,182) | $(23,090) | | Net Loss Attributable to the Company | $(4,439) | $(3,848) | $(591) | $(26,680) | $(15,916) | $(10,764) | | Basic EPS (Class A) | $(0.06) | $(0.06) | $0.00 | $(0.39) | $(0.23) | $(0.16) | [Unaudited Condensed Consolidated Statements of Comprehensive Loss](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Reports the comprehensive loss for the three and nine months ended September 30, 2022 and 2021, including net loss and other comprehensive income components | Metric (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :-------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Net Loss | $(9,531) | $(8,210) | $(1,321) | $(57,272) | $(34,182) | $(23,090) | | Other Comprehensive Income | $13 | $27 | $(14) | $39 | $83 | $(44) |\n| Comprehensive Loss | $(9,518) | $(8,183) | $(1,335) | $(57,233) | $(34,099) | $(23,134) | | Comprehensive Loss Attributable to the Company | $(4,431) | $(3,831) | $(600) | $(26,656) | $(15,864) | $(10,792) | [Unaudited Condensed Consolidated Statements of Capital](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Capital) Details changes in the company's capital structure, including common shares, contributed capital, retained earnings, and noncontrolling interests | Metric (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :-------------------- | :----------- | :----------- | :----- | | Contributed Capital | $586,954 | $587,587 | $(633) | | Retained Earnings | $22,109 | $48,789 | $(26,680)| | Total Members' Capital| $607,146 | $634,424 | $(27,278)| | Noncontrolling Interests | $1,239,337 | $1,265,954 | $(26,617)| | Total Capital | $1,846,483 | $1,900,378 | $(53,895)| - The company's ownership interest in the Operating Company decreased to **62.5%** during the nine months ended September 30, 2022, due to reacquisition of restricted Class A common shares for tax withholding and forfeiture of unvested shares, partially offset by new share-based compensation issuances[64](index=64&type=chunk)[67](index=67&type=chunk)[216](index=216&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Provides a summary of cash flows from operating, investing, and financing activities, indicating a net decrease in cash, cash equivalents, and restricted cash | Metric (in thousands) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :-------------------- | :-------------------------- | :-------------------------- | :----------- | | Net Cash Used in Operating Activities | $(175,023) | $(162,301) | $(12,722) | | Net Cash Provided by Investing Activities | $2,307 | $78,313 | $(76,006) | | Net Cash Used in Financing Activities | $(6,367) | $(23,022) | $16,655 | | Net Decrease in Cash, Cash Equivalents, and Restricted Cash | $(179,083) | $(107,010) | $(72,073) | | Cash, Cash Equivalents, and Restricted Cash—End of period | $87,709 | $192,464 | $(104,755) | [Notes to Unaudited Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations and disclosures for the condensed consolidated financial statements, covering business, accounting policies, and financial information [Note 1. BUSINESS AND ORGANIZATION](index=10&type=section&id=1.%20BUSINESS%20AND%20ORGANIZATION) Describes Five Point Holdings, LLC as an owner and developer of mixed-use planned communities in California, operating through its subsidiary, Five Point Operating Company, LP - Five Point Holdings, LLC is a Delaware limited liability company that owns and develops mixed-use planned communities in California, conducting operations through Five Point Operating Company, LP[36](index=36&type=chunk) - The company has two classes of shares, Class A and Class B common shares, with Class B shares receiving **0.0003 times** the distribution amount of Class A shares[37](index=37&type=chunk) - As of September 30, 2022, the Company owned approximately **62.5%** of the outstanding Class A Common Units of the Operating Company, with noncontrolling interests representing equity interests held by partners in the Operating Company and members in The Shipyard Communities, LLC[40](index=40&type=chunk) [Note 2. BASIS OF PRESENTATION](index=11&type=section&id=2.%20BASIS%20OF%20PRESENTATION) Explains that the financial statements are unaudited, prepared in accordance with U.S. GAAP for interim financial information, and include consolidation of subsidiaries and VIEs - The condensed consolidated financial statements are unaudited and prepared in accordance with U.S. GAAP for interim financial information, consolidating subsidiaries and variable interest entities where the Holding Company is the primary beneficiary[42](index=42&type=chunk)[43](index=43&type=chunk) - Restructuring costs of **$19.4 million** were recognized during the nine months ended September 30, 2022, including **$15.6 million** for advisory agreement payments to former executives and **$3.0 million** in share-based compensation expense, plus **$0.9 million** from severance benefits[45](index=45&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) [Note 3. REVENUES](index=14&type=section&id=3.%20REVENUES) Disaggregates the company's consolidated revenues by source and reporting segment, highlighting a decrease in total revenues for both periods | Revenue Source (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :---------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Land sales | $72 | $10,000 | $(9,928) | $643 | $10,087 | $(9,444) | | Land sales—related party | $2,817 | $17 | $2,800 | $4,529 | $73 | $4,456 | | Management services—related party | $12,108 | $10,156 | $1,952 | $18,358 | $30,242 | $(11,884) | | Operating properties | $419 | $522 | $(103) | $2,165 | $1,777 | $388 | | Total Revenues | $15,416 | $20,695 | $(5,279) | $25,695 | $42,179 | $(16,484) | - The Development Management Agreement (A&R DMA) with Great Park Venture was extended through December 31, 2022, eliminating variable cost reimbursements and increasing the annual fixed base fee to **$12.0 million** for 2022[49](index=49&type=chunk) - Contract assets increased by **$6.3 million** for the nine months ended September 30, 2022, primarily due to additional incentive compensation revenue from changes in estimated transaction price, offset by marketing fees received from prior land sales[50](index=50&type=chunk) [Note 4. INVESTMENT IN UNCONSOLIDATED ENTITIES](index=16&type=section&id=4.%20INVESTMENT%20IN%20UNCONSOLIDATED%20ENTITIES) Details the company's equity method investments in Great Park Venture, Gateway Commercial Venture, and Valencia Landbank Venture, including their financial performance - The Great Park Venture fully satisfied **$476.0 million** in priority distribution rights to Legacy Interest holders, with **$82.7 million** remaining for participating Legacy Interest distribution rights as of September 30, 2022[52](index=52&type=chunk)[175](index=175&type=chunk) | Great Park Venture (in thousands) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :-------------------------------- | :-------------------------- | :-------------------------- | :----------- | | Land sale and related party land sale revenues | $39,020 | $407,311 | $(368,291) | | Net (loss) income of Great Park Venture | $(19,658) | $63,604 | $(83,262) | | Equity in (loss) earnings from Great Park Venture | $(5,634) | $8,319 | $(13,953) | - The Gateway Commercial Venture recognized **$6.2 million** and **$6.4 million** in rental revenues for the nine months ended September 30, 2022 and 2021, respectively, from leasing arrangements with the Company and a Lennar subsidiary[60](index=60&type=chunk) - The Company's investment in Valencia Landbank Venture was **$2.3 million** at September 30, 2022, and it recognized **$0.9 million** in equity in earnings for the nine months ended September 30, 2022[63](index=63&type=chunk) [Note 5. NONCONTROLLING INTERESTS](index=18&type=section&id=5.%20NONCONTROLLING%20INTERESTS) Explains the nature of noncontrolling interests in the Operating Company and San Francisco Venture, including exchange rights and tax distribution provisions - Noncontrolling interests represent equity interests in the Operating Company (**37.5%** of Class A Common Units) and Class A units of the San Francisco Venture, held by affiliates of Lennar, Castlelake, and Emile Haddad[64](index=64&type=chunk)[70](index=70&type=chunk) - Holders of Class A Common Units of the Operating Company and Class A units of the San Francisco Venture have exchange rights for Class A common shares or cash, subject to certain conditions[65](index=65&type=chunk)[71](index=71&type=chunk) | Tax Distributions (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :------------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Management Partner | $0 | $1,246 | $(1,246) | $435 | $2,932 | $(2,497) | | Other partners | $0 | $0 | $0 | $0 | $1,497 | $(1,497) | | Total Tax Distributions | $0 | $1,246 | $(1,246) | $435 | $4,429 | $(3,994) | - The San Francisco Venture has **$25.0 million** in redeemable noncontrolling interest from Class C units issued to an affiliate of Lennar, redeemable upon certain Mello-Roos reimbursements or at the San Francisco Venture's option[72](index=72&type=chunk) [Note 6. CONSOLIDATED VARIABLE INTEREST ENTITY](index=19&type=section&id=6.%20CONSOLIDATED%20VARIABLE%20INTEREST%20ENTITY) Explains that the Holding Company consolidates the Operating Company and its subsidiaries as Variable Interest Entities (VIEs) due to its primary beneficiary status - The Holding Company consolidates the Operating Company, San Francisco Venture, FP LP, and FPL as VIEs, as it is determined to be the primary beneficiary due to its unilateral power over significant economic activities and more-than-insignificant economic benefit[73](index=73&type=chunk)[74](index=74&type=chunk)[79](index=79&type=chunk) - As of September 30, 2022, the San Francisco Venture had total combined assets of **$1.3 billion** (primarily inventories) and liabilities of **$72.0 million**, with creditors having no recourse to the Company's assets[75](index=75&type=chunk)[77](index=77&type=chunk) - As of September 30, 2022, FP LP and FPL had combined assets of **$1.1 billion** (primarily inventories and intangibles) and liabilities of **$81.1 million**[80](index=80&type=chunk) [Note 7. INTANGIBLE ASSET, NET—RELATED PARTY](index=20&type=section&id=7.%20INTANGIBLE%20ASSET,%20NET%E2%80%94RELATED%20PARTY) Describes the intangible asset related to incentive compensation provisions of the Development Management Agreement with the Great Park Venture, amortized over the expected contract period - The intangible asset represents the contract value of incentive compensation from the A&R DMA with the Great Park Venture, amortized over the expected contract period based on economic benefit patterns[83](index=83&type=chunk) | Metric (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :-------------------- | :----------- | :----------- | :----- | | Gross carrying amount | $129,705 | $129,705 | $0 | | Accumulated amortization | $(83,736) | $(78,300) | $(5,436)| | Net book value | $45,969 | $51,405 | $(5,436)| - Intangible asset amortization expense was **$5.4 million** for both the three and nine months ended September 30, 2022, and **$4.9 million** and **$15.5 million** for the three and nine months ended September 30, 2021, respectively, included in the cost of management services[84](index=84&type=chunk) [Note 8. RELATED PARTY TRANSACTIONS](index=21&type=section&id=8.%20RELATED%20PARTY%20TRANSACTIONS) Details various related party assets and liabilities, including contract assets from the Great Park Venture's development management agreement and accrued advisory fees | Related Party Assets (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :---------------------------------- | :----------- | :----------- | :----- | | Contract assets | $87,003 | $79,082 | $7,921 | | Operating lease right-of-use asset | $17,006 | $18,715 | $(1,709)| | Total Related Party Assets | $104,887 | $101,818 | $3,069 | | | | | | | Related Party Liabilities (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :----------------------------------- | :----------- | :----------- | :----- | | Reimbursement obligation | $66,341 | $69,536 | $(3,195)| | Accrued advisory fees | $11,975 | $0 | $11,975|\n| Total Related Party Liabilities | $99,913 | $95,918 | $3,995 | - The Development Management Agreement with Great Park Venture includes "Legacy Incentive Compensation" (max **$9.0 million**) and "Non-Legacy Incentive Compensation" (**9%** of distributions), with a potential clawback to **6.75%** if the agreement is not extended beyond December 31, 2022[86](index=86&type=chunk) - Accrued advisory fees of **$9.6 million** for Emile Haddad and **$2.4 million** for Lynn Jochim were included in related party liabilities as of September 30, 2022, following their transitions to advisory roles[88](index=88&type=chunk)[89](index=89&type=chunk) [Note 9. NOTES PAYABLE, NET](index=22&type=section&id=9.%20NOTES%20PAYABLE,%20NET) Details the company's notes payable, primarily consisting of **7.875%** Senior Notes due 2025, and the status of its unsecured revolving credit facility | Notes Payable (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :--------------------------- | :----------- | :----------- | :----- | | 7.875% Senior Notes due 2025 | $625,000 | $625,000 | $0 | | Unamortized debt issuance costs and discount | $(4,733) | $(5,884) | $1,151 | | Notes payable, net | $620,267 | $619,116 | $1,151 | - The Operating Company has a **$125.0 million** unsecured revolving credit facility maturing in April 2024, with **$0.3 million** issued in letters of credit, leaving **$124.7 million** available as of September 30, 2022[91](index=91&type=chunk) [Note 10. TAX RECEIVABLE AGREEMENT](index=22&type=section&id=10.%20TAX%20RECEIVABLE%20AGREEMENT) States the company is party to a Tax Receivable Agreement (TRA) with certain unit holders, with a liability of **$173.1 million** as of September 30, 2022 - The company has a Tax Receivable Agreement (TRA) with holders of Class A Common Units of the Operating Company and Class A units of the San Francisco Venture[92](index=92&type=chunk) | TRA Liability (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :--------------------------- | :----------- | :----------- | :----- | | Payable pursuant to tax receivable agreement | $173,068 | $174,126 | $(1,058)| - No TRA payments were made during the nine months ended September 30, 2022 or 2021[92](index=92&type=chunk) [Note 11. COMMITMENTS AND CONTINGENCIES](index=22&type=section&id=11.%20COMMITMENTS%20AND%20CONTINGENCIES) Outlines the company's various contractual obligations, including operating leases, performance bonds, guarantees, and ongoing legal proceedings | Commitments (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :------------------------- | :----------- | :----------- | :----- | | Operating lease right-of-use assets | $20,267 | $23,779 | $(3,512)| | Operating lease liabilities | $16,814 | $20,034 | $(3,220)| | Other contractual payment guarantees | $10,500 | N/A | N/A | | Outstanding performance bonds | $326,300 | $279,600 | $46,700| | Guarantees benefiting San Francisco Agency | $198,300 | $198,300 | $0 | | Outstanding letters of credit | $1,300 | $1,300 | $0 | - The company is involved in legal proceedings (Bayview Action, Homeowners Action) concerning alleged environmental contamination and misrepresentation at The San Francisco Shipyard, with a settlement approved for the Homeowners Action in March 2022[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) [Note 12. SUPPLEMENTAL CASH FLOW INFORMATION](index=24&type=section&id=12.%20SUPPLEMENTAL%20CASH%20FLOW%20INFORMATION) Provides additional details on cash flow activities, including cash paid for interest and noncash lease expense, and reconciles cash, cash equivalents, and restricted cash | Supplemental Cash Flow (in thousands) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :------------------------------------ | :-------------------------- | :-------------------------- | :----------- | | Cash paid for interest (capitalized to inventories) | $26,902 | $27,177 | $(275) | | Noncash lease expense | $3,453 | $3,296 | $157 | | Adjustment to liability recognized under TRA | $(1,058) | $878 | $(1,936) | | Cash paid for income taxes | $0 | $775 | $(775) | | Cash Reconciliation (in thousands) | Sep 30, 2022 | Sep 30, 2021 | Change | | :--------------------------------- | :----------- | :----------- | :----- | | Cash and cash equivalents | $86,379 | $191,134 | $(104,755)| | Restricted cash and certificates of deposit | $1,330 | $1,330 | $0 | | Total cash, cash equivalents, and restricted cash | $87,709 | $192,464 | $(104,755)| [Note 13. SEGMENT REPORTING](index=24&type=section&id=13.%20SEGMENT%20REPORTING) Defines the company's four reportable segments: Valencia, San Francisco, Great Park, and Commercial, each representing distinct mixed-use planned communities or commercial operations - The company operates through four reportable segments: Valencia (northern Los Angeles County), San Francisco (Candlestick and The San Francisco Shipyard), Great Park (Orange County Great Park Neighborhoods), and Commercial (Five Point Gateway Campus)[105](index=105&type=chunk)[106](index=106&type=chunk)[107](index=107&type=chunk)[108](index=108&type=chunk) | Segment Revenues (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :------------------------------ | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Valencia | $3,082 | $10,398 | $(7,316) | $6,809 | $11,506 | $(4,697) | | San Francisco | $226 | $141 | $85 | $528 | $431 | $97 | | Great Park | $47,195 | $92,486 | $(45,291) | $97,541 | $450,196 | $(352,655) | | Commercial | $2,297 | $2,210 | $87 | $6,560 | $6,661 | $(101) | | Total Reportable Segments | $52,800 | $105,235 | $(52,435) | $111,438 | $468,794 | $(357,356) | | Segment Assets (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :---------------------------- | :----------- | :----------- | :----- | | Valencia | $977,974 | $878,399 | $99,575| | San Francisco | $1,303,826 | $1,275,510 | $28,316| | Great Park | $1,012,305 | $988,444 | $23,861| | Commercial | $103,746 | $104,400 | $(654) | | Total Reportable Segments | $3,397,851 | $3,246,753 | $151,098| [Note 14. SHARE-BASED COMPENSATION](index=26&type=section&id=14.%20SHARE-BASED%20COMPENSATION) Summarizes share-based equity compensation activity, including grants, forfeitures, and vesting, and details the share-based compensation expense recognized | Share-Based Awards (in thousands) | Nonvested at Jan 1, 2022 | Granted | Forfeited | Vested | Nonvested at Sep 30, 2022 | | :-------------------------------- | :----------------------- | :------ | :-------- | :----- | :------------------------ | | Number of Awards | 2,640 | 1,359 | (834) | (979) | 2,186 | | Weighted-Average Grant Date Fair Value | $6.38 | $1.92 | $2.96 | $7.80 | $3.79 | | Share-Based Compensation Expense (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :---------------------------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Total Expense | $700 | $1,800 | $(1,100) | $5,500 | $4,200 | $1,300 | - For the nine months ended September 30, 2022, **$3.0 million** of share-based compensation expense was included in restructuring expense and **$2.5 million** in selling, general, and administrative expenses due to modification of awards for former officers[112](index=112&type=chunk) [Note 15. EMPLOYEE BENEFIT PLANS](index=26&type=section&id=15.%20EMPLOYEE%20BENEFIT%20PLANS) Provides details on the company's frozen defined benefit Retirement Plan, including the components of net periodic benefit - The Newhall Land and Farming Company Retirement Plan is a frozen defined benefit plan, with no service cost component[114](index=114&type=chunk) | Net Periodic Benefit (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :---------------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Interest cost | $136 | $128 | $8 | $408 | $384 | $24 | | Expected return on plan assets | $(261) | $(289) | $28 | $(783) | $(870) | $87 | | Amortization of net actuarial loss | $13 | $27 | $(14) | $39 | $83 | $(44) | | Total Net Periodic Benefit | $(112) | $(134) | $22 | $(336) | $(403) | $67 | [Note 16. INCOME TAXES](index=26&type=section&id=16.%20INCOME%20TAXES) Explains the company's income tax treatment and notes that no significant income tax provision or benefit was recorded due to a valuation allowance against deferred tax assets - The Holding Company is treated as a corporation for tax purposes, while most subsidiaries are pass-through entities[115](index=115&type=chunk) - No significant income tax provision or benefit was recorded for the three and nine months ended September 30, 2022 and 2021, due to the application of an increase in the company's valuation allowance against its net deferred tax assets, driven by a history of book losses[116](index=116&type=chunk)[117](index=117&type=chunk)[118](index=118&type=chunk) [Note 17. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS AND DISCLOSURES](index=27&type=section&id=17.%20FINANCIAL%20INSTRUMENTS%20AND%20FAIR%20VALUE%20MEASUREMENTS%20AND%20DISCLOSURES) Discusses the fair value measurement of financial instruments, noting that most carrying amounts approximate fair value, except for notes payable, net - The company uses a fair value hierarchy (Level 1, 2, 3) for financial instrument measurements[119](index=119&type=chunk) - The carrying amounts of most financial instruments (cash, restricted cash, certain related party assets/liabilities, accounts payable) approximated their fair value[119](index=119&type=chunk) | Notes Payable, Net (in thousands) | Sep 30, 2022 | Dec 31, 2021 | | :-------------------------------- | :----------- | :----------- | | Estimated Fair Value | $499,700 | $655,600 | | Carrying Value | $620,300 | $619,100 | [Note 18. EARNINGS PER SHARE](index=27&type=section&id=18.%20EARNINGS%20PER%20SHARE) Explains the company's use of the two-class method for EPS calculation, allocating net income/loss between Class A and Class B common shares and considering dilutive potential securities - The company uses the two-class method for EPS, allocating net income/loss between Class A and Class B common shares, with Class B shares receiving **0.03%** of Class A distributions[121](index=121&type=chunk) - No distributions on common shares were declared for the three and nine months ended September 30, 2022 or 2021[122](index=122&type=chunk) | EPS (Class A) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | | :------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Basic | $(0.06) | $(0.06) | $(0.39) | $(0.23) | | Diluted | $(0.07) | $(0.06) | $(0.39) | $(0.23) | [Note 19. ACCUMULATED OTHER COMPREHENSIVE LOSS](index=28&type=section&id=19.%20ACCUMULATED%20OTHER%20COMPREHENSIVE%20LOSS) Details the components of accumulated other comprehensive loss attributable to the company, primarily unamortized defined benefit pension plan net actuarial losses - Accumulated other comprehensive loss attributable to the Company primarily consists of unamortized defined benefit pension plan net actuarial losses, totaling **$1.9 million** at September 30, 2022[125](index=125&type=chunk) - A full valuation allowance is held against the accumulated tax benefits related to these losses[125](index=125&type=chunk) [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Provides management's perspective on the company's financial condition and results of operations, discussing business, operational highlights, financial performance, liquidity, and capital structure [Overview](index=29&type=section&id=Overview) Five Point Holdings, LLC conducts all business through its operating company, Five Point Operating Company, LP, in which it holds approximately **62.5%** ownership - Five Point Holdings, LLC operates through Five Point Operating Company, LP, owning approximately **62.5%** of it as of September 30, 2022[127](index=127&type=chunk) - The operating company consolidates and controls entities developing Valencia, Candlestick, and The San Francisco Shipyard, while holding equity method interests in Great Park Venture and Gateway Commercial Venture[127](index=127&type=chunk)[128](index=128&type=chunk) [Operational Highlights](index=30&type=section&id=Operational%20Highlights) The company experienced softening residential markets due to rising mortgage rates, leading to delays in some residential land sales, but commercial land offerings are progressing with significant cost savings - Residential markets were negatively impacted by rising mortgage rates, causing the company to delay some residential land sales at Valencia and Great Park Neighborhoods to match market pace and prices[129](index=129&type=chunk) - Commercial land offerings are moving forward at Great Park Neighborhoods and Valencia[130](index=130&type=chunk) - Guest builders sold **166 homes** at Valencia in Q3 2022, totaling **891 homes** since sales began in May 2021[130](index=130&type=chunk) - The Great Park Venture sold **61 homesites** for **$23.9 million** in Q3 2022, and guest builders sold **82 homes** at Great Park Neighborhoods[131](index=131&type=chunk) - Selling, general, and administrative costs decreased by **42%** in Q3 2022 compared to Q3 2021, driven by cost rationalization and a **29%** reduction in headcount since the end of 2021[132](index=132&type=chunk)[138](index=138&type=chunk)[145](index=145&type=chunk) [Results of Operations](index=31&type=section&id=Results%20of%20Operations) The company experienced significant variability in its results of operations due to the timing of land sales and market conditions, leading to increased net loss attributable to the company - The timing of land sale revenues, influenced by planning, development, and market conditions, causes variability in results of operations[134](index=134&type=chunk) | Metric (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :-------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Total Revenues | $15,416 | $20,695 | $(5,279) | $25,695 | $42,179 | $(16,484) | | Total Costs & Expenses| $21,098 | $30,927 | $(9,829) | $79,078 | $89,311 | $(10,233) | | Net Loss Attributable to the Company | $(4,439) | $(3,848) | $(591) | $(26,680) | $(15,916) | $(10,764) | [Three Months Ended September 30, 2022 and 2021](index=31&type=section&id=Three%20Months%20Ended%20September%2030,%202022%20and%202021) Revenues decreased by **25.5%** due to lower land sales, while costs of management services and SG&A expenses decreased, and equity in loss from unconsolidated entities increased - Revenues decreased by **$5.3 million** (**25.5%**) to **$15.4 million**, primarily due to lower land sales at Valencia, offset by increased management services revenue at Great Park[136](index=136&type=chunk) - Cost of management services decreased by **$0.6 million** (**7.3%**) to **$7.5 million**, mainly due to reduced reimbursable project team expenses at Great Park[137](index=137&type=chunk) - Selling, general, and administrative expenses decreased by **$8.7 million** (**42.0%**) to **$12.0 million**, primarily due to a **29%** reduction in headcount since the end of 2021[138](index=138&type=chunk) - Equity in loss from unconsolidated entities was **$4.3 million**, a decrease from earnings of **$0.5 million** in the prior year, mainly due to the Great Park Venture's net loss[140](index=140&type=chunk) [Nine Months Ended September 30, 2022 and 2021](index=32&type=section&id=Nine%20Months%20Ended%20September%2030,%202022%20and%202021) Revenues decreased by **39.1%** due to lower management services revenue and land sales, while costs and SG&A expenses decreased, and restructuring costs were incurred - Revenues decreased by **$16.5 million** (**39.1%**) to **$25.7 million**, primarily due to lower management services revenue at Great Park and reduced land sales at Valencia[143](index=143&type=chunk) - Cost of management services decreased by **$12.3 million** (**49.9%**) to **$12.4 million**, mainly due to decreased reimbursable project team expenses and intangible asset amortization at Great Park[144](index=144&type=chunk) - Selling, general, and administrative expenses decreased by **$18.0 million** (**30.3%**) to **$41.5 million**, driven by a **29%** reduction in headcount[145](index=145&type=chunk) - Restructuring costs of **$19.4 million** were incurred, including **$15.6 million** for executive advisory agreements and **$3.0 million** in share-based compensation expense due to award modifications, plus **$0.9 million** for severance benefits[146](index=146&type=chunk)[147](index=147&type=chunk) - Equity in loss from unconsolidated entities was **$4.7 million**, a decrease from earnings of **$9.0 million** in the prior year, mainly due to the Great Park Venture's net loss[148](index=148&type=chunk) [Segment Results and Financial Information](index=34&type=section&id=Segment%20Results%20and%20Financial%20Information) The company's four reportable segments (Valencia, San Francisco, Great Park, and Commercial) showed varied performance, with Valencia and Great Park experiencing significant revenue declines - The company's reportable segments include Valencia, San Francisco, Great Park, and Commercial, each with distinct operational results[153](index=153&type=chunk) | Segment Revenues (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | Change (YoY) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :------------------------------ | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Valencia | $3,082 | $10,398 | $(7,316) | $6,809 | $11,506 | $(4,697) | | San Francisco | $226 | $141 | $85 | $528 | $431 | $97 | | Great Park | $47,195 | $92,486 | $(45,291) | $97,541 | $450,196 | $(352,655) | | Commercial | $2,297 | $2,210 | $87 | $6,560 | $6,661 | $(101) | [Valencia Segment](index=37&type=section&id=Valencia%20Segment) Revenues for the Valencia segment significantly decreased due to lower variable land sale consideration, while selling, general, and administrative expenses also decreased - Valencia segment revenues decreased to **$3.1 million** (Q3 2022) from **$10.4 million** (Q3 2021) and to **$6.8 million** (9M 2022) from **$11.5 million** (9M 2021), mainly due to lower variable land sale consideration compared to a **$10.0 million** contingent payment received in 2021[163](index=163&type=chunk)[165](index=165&type=chunk) - Selling, general, and administrative expenses decreased by **51.8%** in Q3 2022 and **28.5%** in 9M 2022, driven by reduced community-related selling, marketing, and employee expenses[164](index=164&type=chunk)[166](index=166&type=chunk) [San Francisco Segment](index=38&type=section&id=San%20Francisco%20Segment) The San Francisco segment's development is delayed due to environmental contamination allegations and resampling efforts by the U.S. Navy, with potential for further delays and legal claims - The San Francisco segment includes Candlestick and The San Francisco Shipyard, planned for approximately **12,000 homesites** and **6.3 million square feet** of commercial space[167](index=167&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk) - Development at The San Francisco Shipyard is delayed due to allegations of misrepresented sampling results by contractors, leading to data reevaluation, government investigations, and additional resampling efforts by the U.S. Navy[170](index=170&type=chunk) - The company has been named in lawsuits regarding alleged contamination at The San Francisco Shipyard, with a settlement approved for the Homeowners Action in March 2022[171](index=171&type=chunk) [Great Park Segment](index=38&type=section&id=Great%20Park%20Segment) The Great Park segment experienced a significant decrease in land sales revenues due to fewer homesites sold, while management fee revenues increased due to revised estimates - The Great Park segment includes Great Park Neighborhoods (**2,100 acres**, **10,500 homesites**, **4.9 million sq ft commercial**) and development management services for the Great Park Venture, in which the company holds a **37.5%** interest[173](index=173&type=chunk)[174](index=174&type=chunk) - Land sales and related party land sales revenues decreased to **$35.2 million** (Q3 2022) from **$69.5 million** (Q3 2021) and to **$39.0 million** (9M 2022) from **$407.3 million** (9M 2021), primarily due to fewer homesites sold (**61** in 2022 vs. **113** in Q3 2021; **61** in 2022 vs. **887** in 9M 2021)[176](index=176&type=chunk)[185](index=185&type=chunk) - Management fee revenues increased due to a revised base fee and increased estimates of variable incentive compensation, while management services costs and selling, general, and administrative expenses decreased due to reduced project team and marketing expenses[181](index=181&type=chunk)[182](index=182&type=chunk)[183](index=183&type=chunk)[191](index=191&type=chunk)[192](index=192&type=chunk)[193](index=193&type=chunk)[194](index=194&type=chunk) | Great Park Venture Equity (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | | :--------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Segment (loss) profit from operations | $(13,791) | $8,957 | $(13,984) | $68,842 | | Net (loss) income of the Great Park Venture | $(18,303) | $6,978 | $(19,658) | $63,604 | | Equity in (loss) earnings from the Great Park Venture | $(4,540) | $367 | $(5,634) | $8,319 | [Commercial Segment](index=42&type=section&id=Commercial%20Segment) The Commercial segment includes the Gateway Commercial Venture, which owns a commercial office building and land, managed by the company but accounted for using the equity method due to limited control - The Commercial segment includes the Gateway Commercial Venture, which owns one commercial office building and approximately **50 acres** of commercial land at the Five Point Gateway Campus[197](index=197&type=chunk)[198](index=198&type=chunk) - The company manages the Gateway Commercial Venture but accounts for its **75%** interest using the equity method due to limited control, as major decisions require unanimous executive committee approval[197](index=197&type=chunk) | Gateway Commercial Venture Equity (in thousands) | 3 Months Ended Sep 30, 2022 | 3 Months Ended Sep 30, 2021 | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | | :----------------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Segment (loss) profit from operations | $(8) | $48 | $441 | $903 | | Net (loss) income of the Gateway Commercial Venture | $(116) | $(54) | $129 | $599 | | Equity in (loss) earnings from the Gateway Commercial Venture | $(87) | $(41) | $97 | $449 | [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) The company's cash and cash equivalents decreased significantly, with short-term needs including operating expenses and development, expected to be met through available cash, distributions, and credit facilities - Consolidated Cash and Cash Equivalents decreased to **$86.4 million** as of September 30, 2022, from **$265.5 million** at December 31, 2021[201](index=201&type=chunk) - The company has a **$125.0 million** unsecured revolving credit facility with **$124.7 million** available as of September 30, 2022[201](index=201&type=chunk) - Approximately **$43.9 million** of related party reimbursement obligations previously due in 2022 have been deferred to 2023[202](index=202&type=chunk) - Short-term cash needs include general and administrative expenses, development expenditures at Valencia and San Francisco, interest payments, and related party reimbursement obligations[202](index=202&type=chunk) - Long-term cash needs are for future horizontal development, investments in income-producing properties, debt service, and general and administrative expenses, expected to be funded by available cash, community cash flows, public financing, and potential capital raises[205](index=205&type=chunk)[206](index=206&type=chunk) | Commitments (in thousands) | Sep 30, 2022 | Dec 31, 2021 | Change | | :------------------------- | :----------- | :----------- | :----- | | Outstanding performance bonds | $326,300 | $279,600 | $46,700| | San Francisco Venture guarantees | $198,300 | $198,300 | $0 | | Outstanding LOCs | $1,300 | $1,300 | $0 | [Summary of Cash Flows](index=43&type=section&id=Summary%20of%20Cash%20Flows) Net cash used in operating activities increased, while net cash provided by investing activities decreased significantly, and net cash used in financing activities decreased | Cash Flow Activity (in thousands) | 9 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2021 | Change (YoY) | | :-------------------------------- | :-------------------------- | :-------------------------- | :----------- | | Operating activities | $(175,023) | $(162,301) | $(12,722) | | Investing activities | $2,307 | $78,313 | $(76,006) | | Financing activities | $(6,367) | $(23,022) | $16,655 | - The increase in cash used in operating activities was due to continued investment in horizontal development and SG&A costs, including **$24.6 million** in interest payments on senior notes for both periods[210](index=210&type=chunk) - The decrease in cash provided by investing activities was primarily due to a **$76.6 million** distribution from the Great Park Venture in 2021, which did not recur in 2022, offset by a **$2.5 million** distribution from Valencia Landbank Venture in 2022[212](index=212&type=chunk)[213](index=213&type=chunk)[214](index=214&type=chunk) - The decrease in cash used in financing activities was mainly due to lower related party reimbursement obligations (**$3.2 million** in 2022 vs. **$15.9 million** in 2021) and reduced noncontrolling interest tax distributions (**$0.4 million** in 2022 vs. **$4.4 million** in 2021)[215](index=215&type=chunk) [Changes in Capital Structure](index=44&type=section&id=Changes%20in%20Capital%20Structure) The company's ownership percentage in the operating company decreased to **62.5%** due to reacquisition and forfeiture of restricted Class A common shares, partially offset by new issuances - The company's ownership percentage in the operating company decreased to **62.5%** during the nine months ended September 30, 2022[216](index=216&type=chunk) - This change was primarily driven by the reacquisition of **0.4 million** restricted Class A common shares for tax withholding and the forfeiture of **0.8 million** unvested restricted Class A common shares, partially offset by the issuance of **0.2 million** restricted Class A common shares[216](index=216&type=chunk) | Outstanding Units/Shares | Sep 30, 2022 | Dec 31, 2021 | | :----------------------- | :----------- | :----------- | | Class A units of the operating company (Held by us) | 69,068,354 | 70,107,552 | | Class A units of the operating company (Held by noncontrolling interest members) | 41,363,271 | 41,363,271 | | Class A units of the San Francisco Venture (Held by noncontrolling interest members) | 37,870,273 | 37,870,273 | | Class B common shares outstanding | 79,233,544 | 79,233,544 | [Critical Accounting Estimates](index=44&type=section&id=Critical%20Accounting%20Estimates) No significant changes to the company's critical accounting estimates were reported during the nine months ended September 30, 2022 - No significant changes to critical accounting estimates were reported during the nine months ended September 30, 2022[219](index=219&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk stems from its fixed-rate indebtedness, with no current use of derivative financial instruments, but potential future use for floating-rate debt exposure - The company's primary market risk is from its fixed-rate indebtedness[220](index=220&type=chunk) - As of September 30, 2022, consolidated net indebtedness was **$620.3 million**, all bearing fixed interest rates[221](index=221&type=chunk) - The company has not entered into derivative financial instruments but may use swap arrangements in the future to manage floating-rate debt exposure[220](index=220&type=chunk)[221](index=221&type=chunk) [ITEM 4. Controls and Procedures](index=45&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management evaluated the effectiveness of the company's disclosure controls and procedures as of September 30, 2022, concluding they were effective with no material changes in internal control over financial reporting - Disclosure controls and procedures were evaluated and deemed effective as of September 30, 2022[222](index=222&type=chunk) - No material changes in internal control over financial reporting were identified during the period[223](index=223&type=chunk) PART II. OTHER INFORMATION Presents other information including legal proceedings, risk factors, sales of equity securities, defaults, mine safety disclosures, and exhibits [ITEM 1. Legal Proceedings](index=46&type=section&id=ITEM%201.%20Legal%20Proceedings) Refers to Note 11 of the financial statements for disclosures on legal proceedings, primarily involving lawsuits related to alleged environmental contamination at The San Francisco Shipyard - Legal proceedings are detailed in Note 11, primarily concerning alleged environmental contamination at The San Francisco Shipyard[226](index=226&type=chunk) [ITEM 1A. Risk Factors](index=46&type=section&id=ITEM%201A.%20Risk%20Factors) States that there have been no material changes to the risk factors from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2021 - No material changes to risk factors were reported from the Annual Report on Form 10-K for the year ended December 31, 2021[227](index=227&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Reports no unregistered sales of equity securities or use of proceeds during the period - None reported[228](index=228&type=chunk) [ITEM 3. Defaults Upon Senior Securities](index=46&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) Reports no defaults upon senior securities during the period - None reported[228](index=228&type=chunk) [ITEM 4. Mine Safety Disclosures](index=46&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) States that this item is not applicable to the company - Not Applicable[228](index=228&type=chunk) [ITEM 5. Other Information](index=46&type=section&id=ITEM%205.%20Other%20Information) Reports no other information for the period - None reported[228](index=228&type=chunk) [ITEM 6. Exhibits](index=46&type=section&id=ITEM%206.%20Exhibits) Lists the exhibits filed with the Form 10-Q, including certifications of the Principal Executive Officer and Principal Financial Officer, and Inline XBRL documents - Includes certifications (31.1, 31.2, 32.1, 32.2) and Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[228](index=228&type=chunk) [Signatures](index=47&type=section&id=Signatures) The report is duly signed on behalf of Five Point Holdings, LLC by Daniel Hedigan, Chief Executive Officer, and Leo Kij, Interim Chief Financial Officer, on October 28, 2022 - Report signed by Daniel Hedigan (CEO) and Leo Kij (Interim CFO) on October 28, 2022[231](index=231&type=chunk)

Five Point Holdings, LLC (NYSE:FPH) Q3 2022 Results Conference Call October 27, 2022 5:00 PM ET Company Participants Dan Hedigan - Chief Executive Officer Leo Kij - Interim Chief Financial Officer Mike Alvarado - Chief Legal Officer Kim Tobler - Vice President Treasurer and Tax Stuart Miller - Executive Chairman Conference Call Participants Dominick D'Angelo - O'Keefe Stevens Advisory Alan Ratner - Zelman & Associates Operator Greetings and welcome to the Five Point Holdings LLC Third Quarter 2022 Conferenc ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-38088 Five Point Holdings, LLC (Exact name of registrant as specified in its charter) Securities registered pursuant to Section 1 ...

Five Point Holdings, LLC (NYSE:FPH) Q2 2022 Earnings Conference Call August 2, 2022 5:00 PM ET Company Participants Dan Hedigan - Chief Executive Officer Leo Kij - Interim Chief Financial Officer Mike Alvarado - Chief Legal Officer Stuart Miller - Executive Chairman Conference Call Participants Alan Ratner - Zelman & Associates Ryan Dobratz - Third Avenue Management John Moran - Robotti & Company Operator Greetings and welcome to the Five Point Holdings LLC Second Quarter 2022 Conference Call. As a reminder ...

Five Point Holdings, LLC (NYSE:FPH) Q1 2022 Results Conference Call May 12, 2022 5:00 PM ET Company Participants Dan Hedigan - CEO Leo Kij - Interim CFO Conference Call Participants Alan Ratner - Zelman & Associates Ken Hansen - Stifel Operator Greetings, and welcome to the Five Point Holding LLC First Quarter 2022 Conference Call. As a reminder, this call is being recorded. Today’s conference may include for statements regarding Five Point business, financial condition, operations, cash flow, strategy, and ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-38088 Five Point Holdings, LLC (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporat ...