Summary of the Conference Call Company and Industry - The conference call pertains to a land development company involved in residential and commercial real estate, specifically focusing on water rights and infrastructure development in the Denver area. Core Points and Arguments 1. **Current Development Status**: The company is actively developing multiple phases of residential lots, with phase two d being 40% complete and delivering 230 lots this month. The company is also engaged in utility work during winter months, which is temperature sensitive [5][6][7]. 2. **Sales Performance**: Approximately 80-90% of the homes built in phase two b have been sold, with some homes sold before construction began. The average selling rate is about 16 to 18 homes per month across four builders [7][34]. 3. **Market Dynamics**: The company is experiencing cyclical challenges in housing and land development, particularly due to updated county building regulations that delayed permit approvals. This has impacted the builders but has not significantly slowed down overall progress [15][16][19]. 4. **Revenue Recognition**: The company recognizes revenue as it builds infrastructure for its builders. In the current phase, there is a higher than usual number of lots under construction, leading to expectations of significant revenue catch-up in the fourth quarter [25][26][22]. 5. **Commercial Development Valuation**: The company has estimated the value of its commercial development at $423 million, based on a conservative metric of two to three and a half times the value of residential lots [37][39]. 6. **Water Rights and Revenue**: The company has a significant water rights portfolio, with a book value of $31.7 million. The estimated market value of these rights could be around $2.5 billion, considering the potential for 60,000 connections [47][50][91]. 7. **Share Buybacks and Market Perception**: There is a discussion regarding the company's share repurchase strategy, with some shareholders expressing concerns that it competes with their buying efforts. The management argues that share buybacks can enhance shareholder value by reducing the number of shares outstanding [55][61][82]. 8. **Future Growth Potential**: The company anticipates that as it continues to develop its land and water resources, it could significantly increase its capacity for future taps, potentially serving up to 120,000 connections [110][115]. Other Important but Overlooked Content 1. **Data Center Opportunities**: There is potential for developing data centers on the company's land, leveraging its water resources. However, the management acknowledges that this is not their primary focus and would require further exploration [117][129]. 2. **Market Dynamics and Indexing**: The company faces challenges in being indexed well, which affects its stock price relative to its intrinsic value. The management is aware of the need to attract institutional investors to bridge this gap [97][100][106]. 3. **Long-term Projections**: The management emphasizes the importance of demonstrating consistent growth and execution to build credibility with investors, which could lead to a more favorable market perception [103][104]. This summary encapsulates the key points discussed during the conference call, highlighting the company's current status, challenges, and future opportunities in the land development and water rights industry.

Pure Cycle Announces Financial Results For the Three and Nine Months Ended May 31, 2025 DENVER, CO / ACCESSWIRE / July 9, 2025 – Pure Cycle Corporation (NASDAQ Capital Market: PCYO) announced its financial results for the three and nine months ended May 31, 2025. Pure Cycle reported $2.3M of net income for the three months ended May 31, 2025, which marks our twenty-fourth consecutive fiscal quarter with positive net income. Pure Cycle is continuing to develop its Sky Ranch Master Planned Community, despite ...

Financial Data and Key Metrics Changes - Quarterly revenues were $5 million, with gross profits of approximately $3.2 million, reflecting a gross margin of about 63% [7] - Net income for the quarter was over $2 million, translating to earnings per share of $0.09, while year-to-date net income reached $7 million, or $0.29 per share [9][15] - Revenue trends showed a slight decline from previous quarters due to weighted deliveries of lots, particularly from the largest homebuilder, D.R. Horton [9][10] Business Line Data and Key Metrics Changes - The water utility segment saw growth driven by annual customer additions and strong tap fees, particularly from Phase 2B, with about 230 lots delivered last year [16][18] - The oil and gas segment is expected to normalize in fiscal 2026 after a weaker performance in 2025 due to permitting issues [19][20] - The land development segment is on track to deliver approximately 900 lots in Phase 2C, with ongoing work in Phase 2D [21][43] Market Data and Key Metrics Changes - The company operates in a low inventory environment for entry-level homes in the Denver area, which is beneficial for its market positioning [55] - The housing market faces headwinds from consumer confidence and affordability, but the company remains well-positioned due to its unique entry-level master plan community offerings [54][56] Company Strategy and Development Direction - The company focuses on maintaining liquidity to invest in business segments and capitalize on market opportunities, particularly in land acquisition and water rights [52][53] - The strategy includes a phased delivery model to manage inventory levels effectively, ensuring that neither the company nor its homebuilder partners are burdened with excess inventory [56] Management's Comments on Operating Environment and Future Outlook - Management highlighted that consumer confidence is a significant factor affecting the housing market, but the company is well-positioned to meet demand due to its unique offerings [54] - The company anticipates stronger performance in the single-family rental segment over the next 18 months, with plans to increase the number of units [51] Other Important Information - The company has a strong balance sheet with high liquidity, allowing it to navigate volatile markets effectively [52] - A groundbreaking for a new high school project was announced, which is expected to enhance community appeal and support home sales [45] Q&A Session Summary Question: Is there any development on the reservoir sites? - Management indicated that while there are no immediate developments, they are exploring partnership opportunities related to water rights and surface reservoirs [69][70] Question: Where will the water for the new parcel development be sourced? - The water will be sourced from the city of Aurora, as the property has been annexed to the city for over 20 years [71][72] Question: What is the status of the water rights application mentioned in the 10-K? - The company is negotiating with opposing groups regarding a new water right application that was initially turned down, with hopes for a resolution [73][75]

Financial Data and Key Metrics Changes - Quarterly revenues reached $5 million, with gross profits of approximately $3.2 million, reflecting a gross margin of about 63% [7] - Net income for the quarter was over $2 million, translating to earnings per share of $0.09, while year-to-date net income stood at $7 million, or $0.29 per share [9][15] - Revenue trends showed a slight decline from previous quarters, primarily due to weighted deliveries of lots, particularly from the largest homebuilder, D.R. Horton [9][10] Business Line Data and Key Metrics Changes - The water utility segment is driven by annual customer growth and strong tap fees, with a noted decrease in industrial customer demand due to permitting issues [16][17] - The oil and gas segment is expected to normalize in fiscal 2026 after a weaker performance in 2025 due to permitting concentration [19][20] - The land development segment is on track to deliver all lots for Phase 2C in the fourth quarter, with ongoing activities in Phase 2D [21][22] Market Data and Key Metrics Changes - The company operates in a low inventory environment for entry-level homes in the Denver area, which is beneficial for its market positioning [55] - The housing market faces headwinds from consumer confidence and affordability issues, but the company remains one of the few entry-level master plan communities available [53][54] Company Strategy and Development Direction - The company focuses on maintaining liquidity to invest in business segments and capitalize on market opportunities, particularly in land acquisition and water rights [52][53] - The strategic emphasis is on delivering finished lots in real-time to meet builder demands, thereby enhancing partnerships with homebuilders [39][40] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of consumer confidence in the housing market and noted that mortgage rates are less of a headwind than in previous years [54][55] - The company anticipates strong growth in the single-family rental segment over the next 18 months, with plans to reach close to 100 units [51][52] Other Important Information - The company has a robust balance sheet with high liquidity, allowing it to navigate volatile markets effectively [52] - A groundbreaking for a new high school project was announced, which is expected to enhance community appeal and support home sales [44][45] Q&A Session Summary Question: Is there any development on the reservoir sites? - Management indicated that while there are no immediate developments, there are ongoing discussions regarding water rights and potential partnerships for future projects [69][70] Question: Where will the water for the new parcel development be sourced? - The water will be sourced from the city of Aurora, as the property has been annexed to the city for over twenty years [71][72] Question: What is the status of the water rights application mentioned in the 10-K filing? - Management explained that the application for new water rights was complicated and did not prevail, but they are working on finding a resolution with opposing groups [74][75]

Financial Performance - In Q3 2025, Pure Cycle delivered revenue of $5.14 million, gross profit of $3.26 million with a 63% gross margin, and net income of $2.26 million, translating to $0.09 EPS[23] - Year-to-date 2025, Pure Cycle delivered revenue of $14.89 million, gross profit of $8.45 million with a 57% gross margin, and net income of $7.00 million, translating to $0.29 EPS[23] - Year-to-date net income totaled $7 million, representing 56% of the full-year target, and EPS reached $0.29, also 56% of the 2025 EPS guidance[32] - The company has acquired over $130 million in water and land interests[7] Water Utilities - The water rights portfolio can provide water to as many as 60,000 connections[63] - The current water system can produce over 3.4 million gallons of water per day, with a book value of $56 million[65] - The company estimates its water portfolio can generate approximately $2.3 billion in revenues based on current rates, serving approximately 60,000 connections[68] Land Development - Total lot sales from completed phases reached $80 million with a 77% gross margin[79] - Sky Ranch land acquisition cost was $3.7 million, with over $600 million in potential development revenue expected[93] Single-Family Rentals - The company has 14 completed homes with $131,000 in quarterly rent revenue and a 69% gross margin[46, 49] - The fair market value of completed homes is $7.4 million[106]

[PART I - FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Consolidated Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) Net income rose 40% to $7.0 million on higher royalty income, despite an 8% revenue drop, while assets and operating cash flow grew Consolidated Balance Sheet Highlights (in thousands) | Account | May 31, 2025 | August 31, 2024 | Change | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Cash and cash equivalents | $14,392 | $21,946 | ($7,554) | | Land under development | $8,068 | $3,647 | $4,421 | | Reimbursable public improvements (Net) | $40,600 | $40,964 | ($364) | | Investments in water and water systems, net | $64,954 | $60,486 | $4,468 | | Total assets | $151,739 | $147,354 | $4,385 | | **Liabilities & Equity** | | | | | Total liabilities | $15,064 | $17,652 | ($2,588) | | Total shareholders' equity | $136,675 | $129,702 | $6,973 | Consolidated Income Statement Highlights (in thousands) | Account | Nine Months Ended May 31, 2025 | Nine Months Ended May 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total revenues | $14,887 | $16,187 | -8% | | Cost of revenues | $6,437 | $6,202 | +4% | | Operating income | $1,726 | $4,456 | -61% | | Oil and gas royalty income, net | $5,857 | $479 | +1123% | | Net income | $7,002 | $5,008 | +40% | | Diluted EPS | $0.29 | $0.21 | +38% | Consolidated Cash Flow Highlights (in thousands) | Activity | Nine Months Ended May 31, 2025 | Nine Months Ended May 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $3,799 | ($793) | $4,592 | | Net cash used in investing activities | ($8,350) | ($3,991) | ($4,359) | | Net cash used in financing activities | ($350) | ($462) | $112 | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail segment performance, revenue drivers, related-party transactions, and debt obligations [Revenue Analysis](index=14&type=section&id=NOTE%203%20%E2%80%93%20REVENUES%2C%20FEES%20AND%20OTHER%20INCOME%20ITEMS) A surge in tap fee revenue to $5.3 million was offset by declines in lot sales and commercial water usage revenue - For the nine months ended May 31, 2025, the company sold 130 water taps and 127 wastewater taps, generating **$5.3 million in revenue**, a significant increase from 35 water and 33 wastewater taps sold for $1.2 million in the prior year period[33](index=33&type=chunk) - Metered water sales revenue for the nine months ended May 31, 2025, **decreased to $2.1 million** from $5.8 million in the prior year, primarily due to a drop in water sold to industrial users like oil and gas companies[34](index=34&type=chunk) - Lot sales revenue, recognized using the percent-of-completion method for the Sky Ranch development, was **$6.0 million** for the nine months ended May 31, 2025, compared to $7.9 million in the same period of 2024[35](index=35&type=chunk) - The company is expanding its single-family rental portfolio, with **14 homes currently rented** and has reserved an additional **84 lots** in Sky Ranch for future rentals, aiming for a total of 98 units[38](index=38&type=chunk)[39](index=39&type=chunk) [Segment Information](index=30&type=section&id=NOTE%2011%20%E2%80%93%20SEGMENT%20INFORMATION) The Water segment's profit grew while Land Development profit declined, with assets concentrated in the Water segment Segment Profit (Loss) (in thousands) | Segment | Nine Months Ended May 31, 2025 | Nine Months Ended May 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Water and wastewater resource development | $4,142 | $3,883 | +7% | | Land development | $4,068 | $5,906 | -31% | | Single-family rental | $240 | $196 | +22% | Total Assets by Segment (in thousands) | Segment | May 31, 2025 | August 31, 2024 | | :--- | :--- | :--- | | Water and wastewater resource development | $68,588 | $64,616 | | Land development | $11,497 | $8,521 | | Single-family rental | $5,272 | $5,371 | | Corporate | $66,382 | $68,846 | | **Total assets** | **$151,739** | **$147,354** | [Debt and Other Long-Term Obligations](index=19&type=section&id=NOTE%206%20%E2%80%93%20DEBT%20AND%20OTHER%20LONG-TERM%20OBLIGATIONS) Total debt stood at $6.9 million, with an undrawn $5.0 million credit line and $6 million in letters of credit Outstanding Debt Principal (in thousands) | Loan | May 31, 2025 | | :--- | :--- | | Single-Family Rental Home Note Payable | $3,908 | | Lost Creek Note Payable | $3,000 | | **Total outstanding principal** | **$6,908** | - On January 31, 2024, the company entered into a **$5.0 million working capital line of credit**, which was undrawn as of May 31, 2025[60](index=60&type=chunk) - The company has **$6 million in outstanding Irrevocable Letters of Credit** to guarantee performance on construction projects at Sky Ranch, secured by restricted cash[61](index=61&type=chunk) [Related Party Transactions](index=26&type=section&id=NOTE%208%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) The company holds a $40.6 million net receivable from the Sky Ranch CAB for public infrastructure advancements - The note receivable from the Sky Ranch CAB, for reimbursable public improvements and other fees, had a balance of **$40.6 million** as of May 31, 2025[30](index=30&type=chunk)[79](index=79&type=chunk) - During the nine months ended May 31, 2025, the company advanced **$9.4 million** for public improvements and received payments of **$11.4 million** from the Sky Ranch CAB[28](index=28&type=chunk) - Significant customers for the nine months ended May 31, 2025, included homebuilders **Lennar (21% of total revenue)** and **KB Home (20%)**, and two oil & gas operators (6%)[83](index=83&type=chunk)[84](index=84&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=33&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Net income grew 40% to $7.0 million driven by royalty income, with sufficient liquidity to navigate housing market headwinds [Business Overview and Strategy](index=35&type=section&id=Our%20Business%20Strategy) The company's strategy integrates water services, land development, and rentals at its Sky Ranch community - The company operates a cohesive business model combining water/wastewater services, land development at the Sky Ranch master-planned community, and a single-family rental business[97](index=97&type=chunk)[104](index=104&type=chunk) - The Sky Ranch development is being built in phases; as of May 31, 2025, **Phase 2A is 100% complete**, **Phase 2B is 96% complete**, **Phase 2C is 68% complete**, and **Phase 2D is 29% complete**[113](index=113&type=chunk)[114](index=114&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk) - The company is expanding its single-family rental business, with **14 homes completed and rented**, and plans to build on an additional **84 reserved lots** in Phase 2 of Sky Ranch[120](index=120&type=chunk) - For Phase 2 of Sky Ranch, the company estimates total water and wastewater tap fees will **exceed $20.0 million**[119](index=119&type=chunk) [Results of Operations](index=41&type=section&id=Results%20of%20Operations) Net income rose 40% to $7.0 million, driven by a 220% surge in other income that offset an 8% revenue decline Consolidated Results of Operations (in thousands) | Account | Nine Months Ended May 31, 2025 | Nine Months Ended May 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total revenue | $14,887 | $16,187 | -8% | | Operating income | $1,726 | $4,456 | -61% | | Other income, net | $7,551 | $2,357 | +220% | | Net income | $7,002 | $5,008 | +40% | - Water and wastewater tap fee revenue **increased 355% to $5.3 million** for the nine months ended May 31, 2025, due to the timing of lot deliveries at Sky Ranch[131](index=131&type=chunk)[133](index=133&type=chunk) - Commercial water usage revenue **decreased 74% to $1.3 million** for the nine months ended May 31, 2025, due to a decline in water sales to oil and gas operators[131](index=131&type=chunk) - Lot sales revenue **decreased 24% to $6.0 million** for the nine months ended May 31, 2025, due to the timing of construction activities recognized under the percentage of completion method[134](index=134&type=chunk) [Liquidity and Capital Resources](index=47&type=section&id=Liquidity%2C%20Capital%20Resources%20and%20Financial%20Position) The company holds $18.1 million in working capital and generated $3.8 million in operating cash flow - As of May 31, 2025, the company had working capital of **$18.1 million**, including **$14.4 million in cash and cash equivalents**, which is considered sufficient to fund operations for the next 12 months[137](index=137&type=chunk) - For the next 12 months, the company anticipates **spending up to $18.4 million** on Sky Ranch infrastructure and **receiving approximately $28.0 million** in milestone and finished lot payments from builders[138](index=138&type=chunk) Summary of Cash Flows (in thousands) | Activity | Nine Months Ended May 31, 2025 | Nine Months Ended May 31, 2024 | | :--- | :--- | :--- | | Operating activities | $3,799 | ($793) | | Investing activities | ($8,350) | ($3,991) | | Financing activities | ($350) | ($462) | [PART II - OTHER INFORMATION](index=49&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=49&type=section&id=Item%201.%20Legal%20Proceedings) A court denied the company's application for new water rights, though existing rights were unaffected - On February 7, 2025, a Colorado Water Court **denied the company's application for 1,635 acre-feet of new water rights** from the Box Elder Creek Alluvial aquifer and the consolidation and enlargement of certain reservoirs[52](index=52&type=chunk)[147](index=147&type=chunk) - The court's ruling **did not impact the company's existing water rights** or reservoir storage sites, and the company is working towards a settlement on three outstanding claims[147](index=147&type=chunk) [Share Repurchases](index=51&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 2,000 shares in the quarter, with 112,074 shares remaining under the buyback program Common Stock Repurchases (Quarter Ended May 31, 2025) | Period | Total Shares Purchased | Average Price Paid per Share | Shares Remaining in Program | | :--- | :--- | :--- | :--- | | April 2025 | 2,000 | $10.19 | 112,074 | | **Total** | **2,000** | **$10.19** | **112,074** | [Controls and Procedures](index=49&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - Management concluded that as of May 31, 2025, the company's **disclosure controls and procedures were effective**[144](index=144&type=chunk) - **No material changes** were made to internal control over financial reporting during the quarter[145](index=145&type=chunk)

Company Overview - Pure Cycle Corporation has transitioned from a utility company to a land developer, indicating a significant evolution in its business model [1]. Growth Potential - The company is focusing on growth opportunities at Sky Ranch, which may enhance its valuation and future prospects [1]. Investment Strategy - The analysis emphasizes a macroeconomic approach combined with a microeconomic focus on individual companies, suggesting a comprehensive investment strategy that identifies strong economies and quality companies [1].

Financial Performance - Revenues for the three and six months ended February 28, 2025, were $4.0 million and $9.7 million, respectively, compared to $3.2 million and $8.6 million for the same periods in 2024, representing an increase of 25% and 12.8%[3][5][6] - Net income for the three and six months ended February 28, 2025, was $0.8 million and $4.7 million, respectively, compared to $0.118 million and $2.183 million in 2024, indicating a significant increase of 577% and 115%[3][4][6] - Royalty income for the three and six months ended February 28, 2025, was $1.9 million and $4.7 million, respectively, compared to $0.053 million and $0.087 million in 2024, showing a substantial increase of 3,487% and 5,400%[3][4][6] - EBITDA for the three and six months ended February 28, 2025, was $1.8 million and $7.6 million, respectively, compared to $0.778 million and $4.198 million in 2024, reflecting an increase of 131% and 81%[3][4][6] Assets and Liabilities - Total assets increased to $149,656,000 as of February 28, 2025, compared to $147,354,000 on August 31, 2024, reflecting a growth of 1.5%[17] - Current assets decreased from $37,862,000 to $26,991,000, a decline of 28.8%[17] - Total liabilities decreased from $17,652,000 to $15,244,000, a reduction of 13.6%[18] - Total shareholders' equity increased to $134,412,000 from $129,702,000, representing a growth of 3.5%[18] Business Operations - The company operates in three business segments: wholesale water and wastewater services, land development, and single-family home rentals, enhancing recurring revenues[19] - The rental of single-family homes at Sky Ranch contributes to long-term recurring revenues and supports land development operations[19] - The company continues to prioritize investment in ongoing development projects while maintaining a share repurchase program and reserving capital for strategic initiatives[2] Development Projects - The first development phase of Sky Ranch is complete with 509 lots, while the second phase is ongoing with 1,032 lots being developed across five subphases[8][10] - The company is focused on the development of master-planned communities, with ongoing projects at Sky Ranch expected to deliver finished lots in the near future[21] - The single-family rental business had 14 homes built and rented, with an additional 17 homes under contract to build in Phase 2B starting in spring 2025[9][14] Market Outlook - The company anticipates future water and wastewater tap sales and revenues to be strong, driven by market demand[21] - Forward-looking statements indicate potential risks including home mortgage interest rates and inflation impacting the housing market[21] Water Deliveries - Water deliveries decreased to 64 acre-feet for the three months ended February 28, 2025, compared to 404 acre-feet in 2024, and to 367 acre-feet for the six months ended February 28, 2025, compared to 1,028 acre-feet in 2024[12] - The company sold 52 water or wastewater taps for $2.1 million in the three months ended February 28, 2025, and 90 taps for $3.6 million in the six months ended, compared to 0 taps in 2024[7][12] Innovation and Strategy - The company has a commitment to innovation and vertical integration within its service offerings, positioning itself competitively in the market[19]

Earnings Presentation PURE CYCLE CORPORATION For the Six Months Ended February 28th, 2025 Presented by Mark Harding www.purecyclewater.com ,-- Forward-Looking Statements Statements that are not historical facts contained or incorporated by reference in this presentation are "forward-looking statements" ("FLS") within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21C of the Securities Exchange Act of 1934 as amended. FLS involve ris ...

Financial Data and Key Metrics Changes - The company reported approximately $4 million in revenue for Q2, with a gross margin of about 38%, primarily driven by royalty income from mineral royalties [8][9] - Year-to-date revenue reached approximately $10 million, with a gross profit margin exceeding 50% and continued growth in earnings per share [9][12] - The company is on track to meet its fiscal 2025 guidance of around $31 million in revenue, with Q2 typically being the softest quarter due to seasonal factors [12][15] Business Line Data and Key Metrics Changes - The water utility segment performed well, driven by the receipt of TAPIs as new phases of development opened, with strong demand from home builders [17][20] - The land development segment has seen significant activity, with three phases under construction and a robust market for entry-level homes [28][31] - The single-family rental segment maintained high occupancy rates, with 14 homes completed and strong demand anticipated as new units come online [32][53] Market Data and Key Metrics Changes - The company noted a weaker performance in oil and gas deliveries, which was anticipated due to operators focusing on a large block of well permits [19][22] - The Denver real estate market remains active, with builders expressing confidence in the price point and demand for homes in the I-70 corridor [100][101] Company Strategy and Development Direction - The company aims to continue investing in land and water assets, with a focus on land acquisition as a higher priority than additional water rights [91][140] - The development of the Sky Ranch community is a key focus, with plans for a full build-out over the next seven years [66][70] - The company is also exploring commercial development opportunities alongside infrastructure improvements, such as a new interchange [68][135] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current interest rate environment and its impact on affordability, which is expected to benefit builders and the company [98][99] - The company anticipates strong demand for single-family rentals as new units are delivered, despite previous delays in permitting [103][106] - The management highlighted the importance of the local K-12 school as a valuable asset for the community and its role in attracting residents [150][152] Other Important Information - The company has over $20 million in liquidity, with cash and investments totaling approximately $17 million, positioning it well to navigate market challenges [60][64] - The company is actively looking for acquisition opportunities, particularly in land, to enhance its portfolio [91][92] Q&A Session Summary Question: Status of I-70 interchange and potential acquisitions - The CEO indicated that the permit for the I-70 interchange is expected to be submitted soon, with construction anticipated to start by early 2026. Acquisitions are being monitored, but sellers have varying personal requirements for selling [85][90] Question: Update on demand in the Denver real estate market - Management noted strong demand for homes in the I-70 corridor, with builders actively constructing homes and a favorable price point for buyers [96][100] Question: Importance of land acquisition versus water rights - The CEO confirmed that land acquisition is currently prioritized over water rights due to the existing water capacity for 60,000 units, while additional land is needed for development [139][140] Question: Status of the local school and its impact - The CEO provided an update on the K-12 school, highlighting its importance to the community and plans for expanding to include a high school by 2026 [150][152] Question: Opportunities for affordable housing - The CEO mentioned that while the company is not adjacent to federal land, there are opportunities to partner with the state of Colorado for affordable housing initiatives [158][161]