[Part I](index=3&type=section&id=Part%20I) [Business and Properties](index=3&type=section&id=Items%201.%20and%202.%20Business%20and%20Properties) Stratus Properties Inc. is a real estate company focused on residential and retail properties primarily in the Austin, Texas area, generating revenue from property sales, leasing, and management fees across Real Estate Operations and Leasing Operations segments, while navigating challenging market conditions. [Overview](index=3&type=section&id=Overview) Stratus Properties is a real estate company primarily engaged in the development, management, leasing, and sale of multi-family, single-family, and commercial properties in and around Austin, Texas, with recent major transactions including property sales, a joint venture, a special dividend, and share repurchases, all while maintaining its development pipeline and liquidity despite high interest rates. - The company is primarily a **residential and retail-focused real estate developer** in the Austin, Texas area and other select Texas markets[16](index=16&type=chunk) - Key transactions over the last three years include the sale of five Amarra Villas homes for **$18.9 million** and 47 acres at Magnolia Place for **$14.5 million** in 2024; a joint venture formation for the Holden Hills project generating **$35.8 million** in 2023; and the sale of Block 21 for **$112.3 million** in net proceeds in 2022[19](index=19&type=chunk) - Following the Block 21 sale, the Board declared a **special cash dividend of $4.67 per share ($40.0 million total)** in September 2022 and authorized share repurchase programs[18](index=18&type=chunk) - As of December 31, 2024, the company had **$20.2 million in cash** and **$39.0 million available** under its revolving credit facility, with no amounts drawn[21](index=21&type=chunk) - In late 2024 and early 2025, Stratus amended or refinanced loans for The Saint June, Kingwood Place, Lantana Place, and Jones Crossing at lower interest rates, generating approximately **$7.7 million in additional cash proceeds**[23](index=23&type=chunk)[24](index=24&type=chunk) [Operations](index=4&type=section&id=Operations) The company's operations are divided into Real Estate Operations, which contributed 64% of 2024 revenue and manages 1,517 acres for development, and Leasing Operations, which accounted for 36% of 2024 revenue from leasing commercial and multi-family properties with average retail rentals of $22.52 per square foot. Revenue Contribution by Segment | Segment | 2024 Revenue % | 2023 Revenue % | | :--- | :--- | :--- | | Real Estate Operations | 64% | 15% | | Leasing Operations | 36% | 85% | Real Estate Development Portfolio (Acreage as of Dec 31, 2024) | Category | Single Family | Multi-family | Commercial | Total | | :--- | :--- | :--- | :--- | :--- | | Acreage Under Development | 502 | 4 | — | 506 | | Undeveloped Acreage | 12 | 326 | 673 | 1,011 | | **Total Acreage** | **514** | **330** | **673** | **1,517** | - The Leasing Operations segment's principal properties include Jones Crossing, Kingwood Place, Lantana Place, West Killeen Market, and The Saint June[44](index=44&type=chunk) - Average retail rental rates increased to **$22.52 per square foot** as of December 31, 2024, from $22.29 a year prior; **73%** of leased retail square footage has lease expirations beyond 2029[41](index=41&type=chunk) [Properties](index=7&type=section&id=Properties) Stratus' property portfolio is concentrated in the Austin, Texas area, particularly within the Barton Creek community, with key developments including Amarra Villas, The Saint June, and the large-scale Holden Hills project, which is leveraging the new ETJ Law for potential density increases, alongside other projects like The Saint George and recent sales at Magnolia Place. - The Barton Creek community is a major focus, containing Amarra Drive lots, Amarra Villas (20-unit luxury development), The Saint June (182-unit multi-family), and the Holden Hills project[45](index=45&type=chunk)[46](index=46&type=chunk)[48](index=48&type=chunk)[49](index=49&type=chunk) - The Holden Hills project is split into Phase 1 (495-acre residential, in a JV) and Phase 2 (570-acre mixed-use); the company has removed this land from Austin's extraterritorial jurisdiction (ETJ) under a new state law, which is expected to streamline permitting and increase development density[50](index=50&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk) - The Saint George, a **316-unit multi-family project** in north central Austin, is under construction and expected to be completed in the first half of 2025[64](index=64&type=chunk) - In 2024, the company sold 47 acres of undeveloped land at Magnolia Place for **$14.5 million** and the Magnolia Place – Retail phase for **$8.9 million**[66](index=66&type=chunk)[67](index=67&type=chunk) [Human Capital and Sustainability](index=13&type=section&id=Human%20Capital%20and%20Sustainability) Stratus values its 34 non-unionized full-time employees and is a member of the U.S. Green Building Council, emphasizing sustainable development with a history of LEED-certified projects and green features in current and planned communities. - As of December 31, 2024, the company had **34 full-time employees**, none of whom are represented by a union[82](index=82&type=chunk) - Stratus is a member of the U.S. Green Building Council and focuses on sustainable development, with projects like Block 21 achieving LEED Silver certification and Holden Hills Phase 1 being designed with a focus on health, wellness, and sustainability[83](index=83&type=chunk) [Risk Factors](index=14&type=page&id=Item%201A.%20Risk%20Factors) The company faces a range of risks related to its business, debt, operations, and stock ownership, including strategic execution, capital access, market concentration, interest rate sensitivity, restrictive debt covenants, project delays, regulatory challenges (like the ETJ Law litigation), competition, and stock liquidity. [Risks Relating to our Business and Industry](index=14&type=section&id=Risks%20Relating%20to%20our%20Business%20and%20Industry) Stratus's success is not guaranteed and depends on executing its development plans amid challenging market conditions like high inflation and interest rates, which increase costs and can delay projects, with operations heavily concentrated in the Austin, Texas residential market, making it vulnerable to local economic downturns and difficulties in securing capital for future projects, while joint ventures introduce additional risks. - The company's business is sensitive to inflation, higher borrowing costs, tightened credit, and increased construction costs, which have adversely impacted project profitability and timelines[89](index=89&type=chunk) - Operations are heavily concentrated in the Austin, Texas area and focused on residential projects, creating vulnerability to local economic conditions and weakening in the Austin residential market[96](index=96&type=chunk)[98](index=98&type=chunk) - The capital-intensive nature of the industry means the company may not be able to raise additional debt or equity for future projects on acceptable terms, if at all[99](index=99&type=chunk) - Investments through joint ventures involve risks such as partners taking contrary actions, having inconsistent goals, or defaulting on financial obligations[102](index=102&type=chunk) [Risks Relating to our Indebtedness](index=20&type=section&id=Risks%20Relating%20to%20our%20Indebtedness) The company has significant variable-rate debt totaling $194.9 million as of year-end 2024, exposing it to interest rate fluctuations and requiring a substantial portion of cash flow for service payments, which limits funds for other corporate purposes and increases vulnerability to adverse economic conditions, while loan agreements contain restrictive covenants that could lead to default if not complied with. - As of December 31, 2024, total outstanding debt was **$194.9 million**, with principal payments of **$48.9 million** and estimated interest payments of **$12.9 million** due in 2025[112](index=112&type=chunk) - All consolidated debt as of year-end 2024 was **variable-rate**, making the company susceptible to increased interest costs if market rates rise[91](index=91&type=chunk)[112](index=112&type=chunk) - Debt agreements contain restrictive covenants that limit Stratus's ability to borrow additional money, pay dividends, repurchase equity, sell assets, or engage in mergers[115](index=115&type=chunk)[119](index=119&type=chunk) [Risks Relating to Real Estate Operations](index=22&type=section&id=Risks%20Relating%20to%20Real%20Estate%20Operations) The real estate industry's cyclical nature poses a significant risk, with development projects facing delays and cost overruns due to financing, permits, and labor issues, while ongoing litigation challenging the ETJ Law creates uncertainty for the Holden Hills development, and large holdings of undeveloped land are subject to value deterioration if demand weakens, further complicated by intensive regulatory approval processes and environmental regulations. - Development projects are subject to numerous risks including inability to obtain permits, financing challenges, cost overruns, and contractor defaults[121](index=121&type=chunk)[123](index=123&type=chunk) - Litigation challenging the Texas ETJ Law creates uncertainty for the Holden Hills Phases 1 and 2 projects; if the law is invalidated, it could make development more complex and costly, while if upheld, it could streamline the process and increase density[124](index=124&type=chunk)[125](index=125&type=chunk) - Real estate is an illiquid asset, and the company may not be able to sell properties at advantageous times or prices, potentially leading to losses or impairment charges[128](index=128&type=chunk) - Operations are subject to extensive regulatory approval processes and environmental laws, which can cause delays, increase costs, or prevent development entirely[130](index=130&type=chunk)[132](index=132&type=chunk) [Risks Relating to Leasing Operations](index=25&type=section&id=Risks%20Relating%20to%20Leasing%20Operations) The company's leasing operations face risks of being unable to achieve or sustain satisfactory occupancy and rental rates for both its retail and multi-family properties due to market oversupply, competition, economic conditions affecting tenants' ability to pay rent, and the ongoing threat of online shopping to brick-and-mortar retail, while short lease terms for multi-family properties make rental revenues sensitive to market declines. - Achieving satisfactory occupancy and rental rates is challenged by market oversupply, competition, and potential declines in market rental rates[136](index=136&type=chunk)[138](index=138&type=chunk) - Retail tenants face competition from online shopping, which could impact their ability to meet lease obligations[137](index=137&type=chunk) - Multi-family leases are typically for **12 months**, making rental revenues sensitive to short-term declines in market rents[139](index=139&type=chunk) [Cybersecurity](index=28&type=page&id=Item%201C.%20Cybersecurity) Stratus has implemented a cybersecurity risk management program based on the NIST Cybersecurity Framework, with oversight from the Audit Committee and day-to-day management by an internal IT Steering Committee and IT Security Team, and while incidents have occurred, none have had a material effect to date. - The company's cybersecurity program is based on the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF)[148](index=148&type=chunk) - Oversight is provided by the Board's Audit Committee, which receives reports from the Chief Financial Officer[150](index=150&type=chunk)[152](index=152&type=chunk) - An IT Steering Committee of senior management and an IT Security Team are responsible for managing cybersecurity risks and responding to incidents[153](index=153&type=chunk)[154](index=154&type=chunk) - To date, no cybersecurity threats or incidents have materially affected the company's business, operations, or financial condition[149](index=149&type=chunk) [Information About Our Executive Officers](index=29&type=page&id=Information%20About%20Our%20Executive%20Officers) The company's executive officers include William H. Armstrong III, Chairman, President, and CEO since 1992, and Erin D. Pickens, Senior Vice President and Chief Financial Officer since 2009. Executive Officers (as of March 21, 2025) | Name | Age | Position or Office | | :--- | :--- | :--- | | William H. Armstrong III | 60 | Chairman of the Board, President and Chief Executive Officer | | Erin D. Pickens | 63 | Senior Vice President and Chief Financial Officer | [Part II](index=31&type=section&id=Part%20II) [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=31&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Stratus's common stock trades on NASDAQ under "STRS," with its ability to pay dividends restricted by debt agreements, though special dividends were paid in 2017 and 2022, and the company completed a $10.0 million share repurchase program in October 2023, followed by a new $5.0 million program with $3.0 million remaining as of March 21, 2025, during which 62,686 shares were repurchased in Q4 2024. - The company's common stock trades on The Nasdaq Stock Market under the symbol "**STRS**"[165](index=165&type=chunk) - The ability to pay dividends or repurchase shares is restricted by debt covenants with Comerica Bank, requiring prior written consent[166](index=166&type=chunk)[167](index=167&type=chunk) - A **$10.0 million** share repurchase program was completed in October 2023; a new **$5.0 million** program was authorized in November 2023, with **$3.0 million** remaining as of March 21, 2025[167](index=167&type=chunk)[171](index=171&type=chunk) Issuer Purchases of Equity Securities (Q4 2024) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Approximate Dollar Value of Shares That May Yet Be Purchased | | :--- | :--- | :--- | :--- | | Oct 2024 | — | $ — | $5,000,000 | | Nov 2024 | 52,767 | $25.33 | $3,663,598 | | Dec 2024 | 9,919 | $25.58 | $3,409,906 | | **Total** | **62,686** | **—** | **$3,409,906** | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=32&type=section&id=Items%207.%20and%207A.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations%20and%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section provides management's perspective on the company's financial condition and results of operations, detailing a business strategy focused on developing and monetizing properties in Texas, primarily through project-level debt and joint ventures, which led to a significant revenue increase to $54.2 million in 2024 and a net income of $2.0 million, with management confident in sufficient liquidity for the next 12 months. [Business Strategy](index=32&type=section&id=Business%20Strategy) The company's primary objective is to create stockholder value by developing properties for sale or lease, focusing on residential and residential-centric mixed-use projects in Austin and other select Texas markets, utilizing project-level debt and third-party equity from joint ventures to earn fees and limit risk, while maintaining liquidity and potentially returning capital to stockholders. - The primary business objective is to create value by developing properties and then selling or holding them for lease based on favorable market conditions[176](index=176&type=chunk) - The company plans to continue developing properties using project-level debt and third-party equity through joint ventures, earning management fees and potential preferred returns[178](index=178&type=chunk) - Capital may be returned to stockholders via special dividends or share repurchases, as demonstrated in 2017, 2022, and 2023[177](index=177&type=chunk) [Overview of Financial Results for 2024](index=35&type=section&id=Overview%20of%20Financial%20Results%20for%202024) For fiscal year 2024, total revenues significantly increased to $54.2 million from $17.3 million in 2023, primarily driven by a $32.3 million increase in Real Estate Operations from property sales and a $4.6 million increase in Leasing Operations, resulting in a net income attributable to common stockholders of $2.0 million ($0.24 per diluted share), a substantial improvement from a $14.8 million net loss in 2023, despite increased multi-family supply and dropping rental rates in the Austin market. Financial Highlights (2024 vs. 2023) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenues | $54.2 million | $17.3 million | | Net Income (Loss) to Common Stockholders | $2.0 million | $(14.8) million | | Diluted EPS | $0.24 | $(1.85) | - The revenue increase in 2024 was primarily due to sales of five Amarra Villas homes (**$18.9 million**), 47 acres at Magnolia Place (**$14.5 million**), and one Amarra Drive lot (**$1.4 million**)[191](index=191&type=chunk) - In the Austin-Round Rock multi-family market in 2024, supply grew by **10.3%**, causing rental rates to drop by **6.9%**, while occupancy remained high at **92.8%**[196](index=196&type=chunk) [Results of Operations](index=42&type=section&id=Results%20of%20Operations) The company's operating loss narrowed significantly to $2.2 million in 2024 from $16.9 million in 2023, driven by a turnaround in Real Estate Operations to a $4.7 million operating income from $34.9 million in property sales revenue, and an increase in Leasing Operations operating income to $8.1 million from higher rental revenue and a $1.6 million gain on sale, while general and administrative expenses remained stable and interest costs increased to $15.7 million due to higher rates and debt balances. Operating Income (Loss) by Segment (in thousands) | Segment | 2024 | 2023 | | :--- | :--- | :--- | | Real Estate Operations | $4,727 | $(7,219) | | Leasing Operations | $8,070 | $5,440 | | General & administrative expenses | $(14,952) | $(15,167) | | **Total Operating Loss** | **$(2,155)** | **$(16,946)** | - Real Estate Operations revenue surged to **$34.9 million** in 2024 from $2.6 million in 2023, primarily from sales of developed and undeveloped properties[235](index=235&type=chunk) - Leasing Operations rental revenue increased to **$19.3 million** in 2024 from $14.7 million in 2023, mainly reflecting a full year of operations from The Saint June[239](index=239&type=chunk) - A pre-tax gain of **$1.6 million** was recognized in Q3 2024 from the sale of Magnolia Place – Retail[241](index=241&type=chunk) [Capital Resources and Liquidity](index=45&type=section&id=Capital%20Resources%20and%20Liquidity) As of December 31, 2024, Stratus had $20.2 million in cash and $39.0 million available under its revolving credit facility, with total debt increasing to $196.7 million, while cash used in operating activities decreased significantly to $5.8 million, and the company made operating loans and capital contributions to joint ventures, recently refinancing several project loans to extend maturities and lower interest rates, with management confident in compliance with all financial covenants and sufficient liquidity for the next 12 months. Liquidity Position (as of Dec 31, 2024) | Metric | Amount | | :--- | :--- | | Cash and cash equivalents | $20.2 million | | Availability under revolving credit facility | $39.0 million | | Total Debt (principal) | $196.7 million | - Cash used in operating activities totaled **$5.8 million** in 2024, a significant decrease from $51.3 million used in 2023[248](index=248&type=chunk) - The company made operating loans to The Annie B project (**$3.5 million** in 2024) and The Saint June project (**$424 thousand** in 2024) to support debt service and other costs[256](index=256&type=chunk)[257](index=257&type=chunk) - The company was in compliance with all financial covenants as of December 31, 2024[268](index=268&type=chunk) [Debt Maturities and Other Contractual Obligations](index=49&type=section&id=Debt%20Maturities%20and%20Other%20Contractual%20Obligations) As of December 31, 2024, the company has total debt maturities of $50.2 million in 2025, $88.3 million in 2026, and $58.2 million in 2027, all with variable interest rates, and projects it will meet its debt service and other cash obligations for at least the next 12 months, supported by cash, credit facility availability, and expected cash flows, while also having approximately $10 million in firm construction commitments. Debt Maturities by Year (Principal, in thousands, as of Dec 31, 2024) | Year | Amount | | :--- | :--- | | 2025 | $50,181 | | 2026 | $88,301 | | 2027 | $58,183 | | 2028 | $— | | 2029 | $— | | Thereafter | $— | | **Total** | **$196,665** | - Estimated interest payments for 2025 are approximately **$12.9 million**[277](index=277&type=chunk) - The company had firm construction commitments of approximately **$10 million** at year-end 2024, primarily for Holden Hills Phase 1 and The Saint George[278](index=278&type=chunk) [Financial Statements and Supplementary Data](index=53&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section contains the company's audited consolidated financial statements for fiscal years 2024 and 2023, including Management's Annual Report on Internal Control Over Financial Reporting, which concluded controls were effective, and the Independent Registered Public Accounting Firm's unqualified opinion, encompassing the Consolidated Balance Sheets, Statements of Comprehensive Income (Loss), Statements of Cash Flows, Statements of Equity, and detailed Notes. [Consolidated Financial Statements](index=57&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements present the company's financial position and performance, with total assets increasing to $532.6 million in 2024 from $517.8 million in 2023, total liabilities growing to $235.0 million from $223.2 million, and a shift from a net loss of $16.5 million in 2023 to a net loss of $1.9 million in 2024, resulting in net income attributable to common stockholders of $2.0 million, while cash decreased by $11.3 million, ending the year with $21.2 million. Consolidated Balance Sheet Highlights (in thousands) | Account | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total Assets | $532,606 | $517,766 | | Total Liabilities | $235,039 | $223,161 | | Total Stockholders' Equity | $194,705 | $191,479 | | Total Equity | $297,567 | $294,605 | Consolidated Income Statement Highlights (in thousands) | Account | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenues | $54,183 | $17,270 | | Operating Loss | $(2,155) | $(16,946) | | Net Loss | $(1,908) | $(16,493) | | Net Income (Loss) Attributable to Common Stockholders | $1,956 | $(14,807) | [Notes to Consolidated Financial Statements](index=61&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of accounting policies and financial statement line items, covering business and consolidation principles, extensive details on limited partnership and joint venture structures, a breakdown of real estate assets, recent asset sales, a comprehensive summary of all debt facilities including terms and covenants, income taxes, equity transactions, stock-based compensation plans, and various commitments and contingencies. - Stratus consolidates several limited partnerships (Holden Hills, The Saint George, The Annie B, The Saint June, Kingwood Place) as Variable Interest Entities (VIEs) for which it is the primary beneficiary[348](index=348&type=chunk)[373](index=373&type=chunk) - Total net real estate assets increased to **$486.6 million** at year-end 2024 from $459.6 million in 2023, with the largest component being 'Real estate under development' at **$274.1 million**[378](index=378&type=chunk) - Note 6 provides a detailed breakdown of the company's **$194.9 million in debt**, outlining terms, maturity dates, interest rates, and covenants for each facility, including the main revolving credit facility and various project-specific construction and land loans[392](index=392&type=chunk) - The company maintains a Profit Participation Incentive Plan (PPIP) and a Long-Term Incentive Plan (LTIP) to provide economic incentives to key employees tied to the success of designated development projects; the accrued liability for these plans was **$1.9 million** at year-end 2024[441](index=441&type=chunk)[447](index=447&type=chunk) [Controls and Procedures](index=87&type=page&id=Item%209A.%20Controls%20and%20Procedures) Based on an evaluation by the Chief Executive Officer and Chief Financial Officer, the company concluded that its disclosure controls and procedures were effective as of December 31, 2024, with no material changes to internal control over financial reporting during the fourth quarter of 2024. - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were **effective** as of December 31, 2024[471](index=471&type=chunk) [Other Information](index=87&type=page&id=Item%209B.%20Other%20Information) This section reports on significant events, including the amendment of the Comerica Bank revolving credit facility effective March 25, 2025, extending its maturity to March 27, 2027, and lowering the interest rate, and the entry into new three-year Severance and Change of Control Agreements with the CEO and CFO, effective April 1, 2025. - Effective March 25, 2025, the Comerica Bank revolving credit facility was amended to extend the maturity to **March 2027** and lower the interest rate[474](index=474&type=chunk)[475](index=475&type=chunk) - New Severance and Change of Control Agreements were entered into with the CEO and CFO, effective April 1, 2025, for a term through **March 31, 2028**[478](index=478&type=chunk) [Part III](index=89&type=section&id=Part%20III) [Directors, Executive Officers and Corporate Governance](index=89&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information required for this item, including details on directors and corporate governance, will be provided in the company's definitive proxy statement for its 2025 annual meeting of stockholders and is incorporated by reference, with executive officer information presented in Part I of this report. - Information required by this item is incorporated by reference from the registrant's definitive proxy statement for its 2025 annual meeting of stockholders[485](index=485&type=chunk) [Executive Compensation](index=89&type=section&id=Item%2011.%20Executive%20Compensation) The information regarding executive compensation required for this item will be provided in the company's definitive proxy statement for its 2025 annual meeting of stockholders and is incorporated by reference. - Information required by this item is incorporated by reference from the registrant's definitive proxy statement for its 2025 annual meeting of stockholders[486](index=486&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=89&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) The information regarding security ownership required for this item will be provided in the company's definitive proxy statement for its 2025 annual meeting of stockholders and is incorporated by reference. - Information required by this item is incorporated by reference from the registrant's definitive proxy statement for its 2025 annual meeting of stockholders[487](index=487&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=89&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) The information regarding related party transactions and director independence required for this item will be provided in the company's definitive proxy statement for its 2025 annual meeting of stockholders and is incorporated by reference. - Information required by this item is incorporated by reference from the registrant's definitive proxy statement for its 2025 annual meeting of stockholders[488](index=488&type=chunk) [Principal Accounting Fees and Services](index=89&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) The information regarding principal accounting fees and services required for this item will be provided in the company's definitive proxy statement for its 2025 annual meeting of stockholders and is incorporated by reference. - Information required by this item is incorporated by reference from the registrant's definitive proxy statement for its 2025 annual meeting of stockholders[489](index=489&type=chunk) [Part IV](index=89&type=section&id=Part%20IV) [Exhibits, Financial Statement Schedules](index=89&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section indicates that the consolidated financial statements are included in Part II, Item 8, and provides a comprehensive list of all exhibits filed with the Form 10-K, including agreements, corporate governance documents, loan modifications, and certifications, many of which are incorporated by reference from previous filings. - This item lists all exhibits filed with the Form 10-K, including loan agreements, corporate bylaws, and executive compensation plans[492](index=492&type=chunk)[493](index=493&type=chunk)[494](index=494&type=chunk)

Financial Performance - Net income attributable to common stockholders for the year ended December 31, 2024, was $2.0 million, or $0.24 per diluted share, compared to a net loss of $14.8 million, or $1.85 per diluted share, in 2023[4] - Total revenues for 2024 were $54.2 million, a significant increase from $17.3 million in 2023, driven by sales of five Amarra Villas homes for $18.9 million and 47 acres of undeveloped land for $14.5 million[4] - EBITDA for 2024 was $4.1 million, compared to a loss of $10.7 million in 2023, indicating a substantial improvement in operational performance[4] - The net loss for 2024 was $1.908 million, a substantial improvement from a net loss of $16.493 million in 2023, reflecting a reduction of approximately 88%[30] - The company reported a total comprehensive loss attributable to common stockholders of $1.908 million in 2024, compared to a loss of $14.807 million in 2023[26] - The net loss before income taxes for 2024 was $1,466,000, a substantial improvement compared to a net loss of $15,034,000 in 2023[39] Revenue Growth - Total revenues for 2024 reached $54.183 million, a significant increase from $17.270 million in 2023, representing a growth of approximately 213%[26] - Real Estate Operations generated revenues of $34.887 million in 2024, compared to $2.551 million in 2023, indicating a growth of over 1,267%[26] - Revenue from unaffiliated customers for 2024 was $54,183,000, a significant increase from $17,270,000 in 2023, representing a growth of approximately 213%[37] Assets and Equity - Stratus had $20.2 million in cash and cash equivalents as of December 31, 2024, with no amounts drawn on its revolving credit facility, and $39.0 million available under the facility[4] - Total assets increased to $532.606 million in 2024, up from $517.766 million in 2023, marking a growth of about 2.4%[28] - Stratus' total stockholders' equity increased to $194.7 million at December 31, 2024, compared to $191.5 million in 2023, indicating a strengthening balance sheet[14] - The after-tax Net Asset Value (NAV) was $330.5 million, or $40.38 per share, as of December 31, 2024, up from $321.7 million, or $39.40 per share, in 2023[14] Debt and Liabilities - Consolidated debt increased to $194.9 million as of December 31, 2024, from $175.2 million in 2023, primarily due to project construction loans[10] - Total liabilities increased to $235 million in 2024 from $223.2 million in 2023, reflecting a rise of approximately 5.5%[53] - Stratus' debt increased to $194.853 million in 2024 from $175.168 million in 2023, representing an increase of about 11.3%[28] Capital Expenditures - Capital expenditures for the development of real estate properties totaled $58.7 million in 2024, down from $90.4 million in 2023, reflecting a strategic focus on key projects[13] - Capital expenditures for real estate properties in 2024 amounted to $58,661,000, down from $90,413,000 in 2023, indicating a reduction of about 35%[39] Share Repurchase and Stock Performance - The company repurchased 83,380 shares of its common stock for a total cost of $2.0 million under its share repurchase program, with $3.0 million remaining available for future repurchases[4] Operational Highlights - The company completed the lease-up of The Saint June, a 182-unit luxury multi-family project, in 2024, contributing to revenue growth[4] - Segment profit for Real Estate Operations in 2024 was $4,727,000, while Leasing Operations reported a profit of $8,070,000, leading to a total segment profit of $12,797,000[37] - The gain on the sale of assets in 2024 was $1,626,000, contributing positively to the overall financial performance[37] - General and administrative expenses for 2024 were $14,952,000, slightly lower than $15,167,000 in 2023, indicating cost management efforts[37]

Financial Performance - Net loss attributable to common stockholders was $0.4 million, or $0.05 per diluted share, in Q3 2024, a significant improvement from a net loss of $2.8 million, or $0.36 per diluted share, in Q3 2023[2] - Revenues for Q3 2024 were $8.9 million, up from $3.7 million in Q3 2023, primarily due to the sale of one Amarra Villas home for $4.0 million and increased rental revenue from The Saint June[3] - For the first nine months of 2024, revenues totaled $43.9 million compared to $13.0 million in the same period of 2023, driven by the sale of approximately 47 acres of undeveloped land for $14.5 million and four Amarra Villas homes for $15.2 million[3] - The company reported an operating loss of $1.519 million for Q3 2024, an improvement from a loss of $3.329 million in Q3 2023[31] - Net loss attributable to common stockholders for Q3 2024 was $364,000, compared to a net loss of $2.844 million in Q3 2023[31] - Net loss for the third quarter of 2024 was $495,000, a significant improvement from a net loss of $14.8 million in the same period of 2023[35] - Operating cash flow improved to a net cash used of $2.4 million, compared to $39.3 million in the third quarter of 2023[35] - EBITDA for the first nine months of 2024 was $3.9 million, a recovery from $(9.9) million in the same period of 2023[6] - EBITDA for the third quarter of 2024 was $3.88 million, compared to a negative EBITDA of $9.92 million in the same period of 2023[49] Assets and Liabilities - Total assets increased to $523.180 million as of September 30, 2024, up from $517.766 million at the end of 2023[33] - Debt levels rose to $181.540 million as of September 30, 2024, compared to $175.168 million at the end of 2023[33] - Cash and cash equivalents decreased to $19.638 million from $31.397 million at the end of 2023[33] - As of September 30, 2024, Stratus had $19.6 million in cash and cash equivalents and $39.6 million available under its revolving credit facility[5] Real Estate Operations - Real estate operations generated revenues of $3.971 million in Q3 2024, compared to $2.551 million in Q3 2023, marking a 56% increase[31] - Total revenues for the Real Estate Operations segment were $3.97 million, while the Leasing Operations segment generated $4.92 million, totaling $8.89 million in revenues[41] - Operating loss for the Real Estate Operations segment was $1.42 million, while the Leasing Operations segment reported an operating income of $3.25 million[41] - Stratus completed property sales totaling $38.6 million in the first nine months of 2024, with a notable average sales price increase for Amarra Villas homes compared to the prior year[8] - The occupancy rate at The Saint June was approximately 97% as of November 8, 2024, indicating strong demand for the luxury multi-family project[7] Capital Expenditures and Investments - Capital expenditures for the third quarter of 2024 amounted to $6.61 million for Real Estate Operations and $6.82 million for Leasing Operations, totaling $13.43 million[41] - Stratus is currently developing real estate valued at $261.212 million, slightly up from $260.642 million at the end of 2023[33] Share Repurchase and Financing - A new share repurchase program was approved, allowing for repurchases of up to $5.0 million of common stock, following the completion of a previous $10.0 million program[18] - The company has a share repurchase program of $5.0 million, subject to restrictions under its Comerica Bank debt agreements[24] - Stratus is exploring refinancing options for several construction loans, anticipating tighter spreads and potential additional proceeds[17] Legislative and Legal Considerations - The company anticipates potential impacts from Texas Senate Bill 2038 and ongoing litigation, which may affect future operations and development projects[25]

Financial Performance - Revenues for Q1 2024 totaled $26.5 million, a significant increase from $5.8 million in Q1 2023, driven by sales of approximately 47 acres of undeveloped land for $14.5 million and two homes for $7.6 million[84]. - Net income attributable to common stockholders in Q1 2024 was $4.6 million, or $0.56 per diluted share, compared to a net loss of $5.8 million, or $0.73 per diluted share, in Q1 2023[85]. - In Q1 2024, the company reported operating income of $3.685 million, a significant improvement from a loss of $5.593 million in Q1 2023[111]. - Total revenues for Real Estate Operations in Q1 2024 reached $22.123 million, compared to $2.493 million in Q1 2023, driven by developed and undeveloped property sales[113]. - Rental revenue in Q1 2024 was $4.384 million, up from $3.309 million in Q1 2023, primarily due to new leases and revenue from The Saint June[116]. - Operating cash flow increased to $6.5 million in Q1 2024 from a cash outflow of $18.4 million in Q1 2023, primarily due to property sales[125]. Development Projects - The company has a development portfolio of approximately 1,600 acres of commercial and residential projects under development or undeveloped land held for future use[70]. - The Saint June multi-family project achieved approximately 90% lease-up as of May 10, 2024, with the first units available for occupancy in July 2023[89]. - The Saint George project is expected to achieve substantial completion by Q3 2024, with 316 luxury units under development[95]. - The company plans to continue developing properties using project-level debt and third-party equity capital through joint ventures, aiming for attractive long-term returns[74]. - The ETJ Law, effective September 1, 2023, may streamline the development permitting process for the Holden Hills and Section N projects, potentially increasing development density[94]. Cash and Debt Management - As of March 31, 2024, consolidated cash totaled $20.7 million, with $39.6 million available under the revolving credit facility, net of $13.3 million in letters of credit[78]. - The company anticipates seeking additional capital through project-level debt and third-party equity capital arrangements for its development projects[104]. - Total debt as of March 31, 2024, was $170.1 million, down from $177.4 million at December 31, 2023[134]. - The company had $20.7 million in cash and cash equivalents as of March 31, 2024, with no borrowings under the revolving credit facility[133]. - Total debt maturities amount to $170.1 million as of March 31, 2024, with significant amounts due in 2024 ($67.1 million) and 2026 ($62.9 million)[144]. - The company plans to extend or refinance debt maturing in the next 12 months and will not incur material costs for new projects until adequate financing is secured[150]. Interest and Expenses - Interest expense in Q1 2024 totaled $4.0 million, an increase from $2.4 million in Q1 2023, reflecting higher interest rates and increased average debt balances[120]. - The weighted-average interest rate for the Jones Crossing loan increased to 7.70% in Q1 2024 from 6.73% in Q1 2023, while The Annie B land loan rose to 8.41% from 7.44%[147]. - The company recorded a provision for income taxes of $0.1 million in Q1 2024, down from $1.2 million in Q1 2023[121]. - Cash used in investing activities decreased to $8.4 million in Q1 2024 from $10.2 million in Q1 2023, with capital expenditures of $8.1 million primarily for The Saint George[126]. - Cash used in financing activities totaled $9.1 million in Q1 2024, compared to cash provided of $42.7 million in Q1 2023[127]. Future Outlook and Challenges - The company expects to generate approximately $7.2 million of pre-tax net cash proceeds from the sale of West Killeen Market, contracted for $12.8 million, expected to close in Q2 2024[80]. - Market conditions have been challenging due to inflation, higher borrowing costs, and supply chain constraints, impacting project profitability and timelines[105]. - The company does not expect to generate sufficient recurring cash flow to cover general and administrative expenses each period due to its development-focused business model[151]. - Future financial performance will depend on the ability to sell or lease properties profitably and extend or refinance debt as it becomes due[152]. Shareholder and Compliance Matters - A new share repurchase program was approved in November 2023, authorizing repurchases of up to $5.0 million of common stock[132]. - The company was in compliance with all financial covenants as of March 31, 2024[140]. - The company is subject to restrictions under its Comerica Bank debt agreements, limiting stock repurchases and dividend payments without prior consent[164].

Financial Performance - Net income attributable to common stockholders was $4.6 million, or $0.56 per diluted share, in Q1 2024, compared to a net loss of $(5.8) million, or $(0.73) per diluted share, in Q1 2023[4]. - Revenues for Q1 2024 were $26.5 million, a significant increase from $5.8 million in Q1 2023, primarily due to the sale of approximately 47 acres at Magnolia Place for $14.5 million[4][8]. - EBITDA for Q1 2024 totaled $5.2 million, compared to $(4.2) million in Q1 2023, indicating a strong recovery in operational performance[4]. - Operating income for the first quarter of 2024 was $3,685,000, compared to an operating loss of $5,593,000 in the first quarter of 2023, indicating a turnaround in performance[22]. - Net income attributable to common stockholders for Q1 2024 was $4,552,000, compared to a net loss of $5,801,000 in Q1 2023, reflecting a positive shift in profitability[22]. - Basic net income per share attributable to common stockholders was $0.57 for Q1 2024, compared to a loss of $0.73 per share in Q1 2023[22]. Cash and Assets - Stratus had $20.7 million in cash and cash equivalents as of March 31, 2024, down from $31.4 million at December 31, 2023, with no amounts drawn on its revolving credit facility[10]. - Cash and cash equivalents decreased to $20,741,000 as of March 31, 2024, down from $31,397,000 at the end of 2023[24]. - Total assets as of March 31, 2024, were $509,517,000, a slight decrease from $517,766,000 at the end of 2023[24]. Debt and Liabilities - Consolidated debt decreased to $168.2 million as of March 31, 2024, from $175.2 million at December 31, 2023[10]. - Total liabilities decreased to $209,673,000 as of March 31, 2024, from $223,161,000 at the end of 2023, reflecting a reduction in financial obligations[24]. Real Estate Operations - The Real Estate Operations segment generated revenues of $22,123,000 in Q1 2024, compared to $2,493,000 in Q1 2023, marking a growth of 786%[32]. - Capital expenditures and purchases for real estate properties totaled $17.1 million in Q1 2024, compared to $19.0 million in Q1 2023[13]. - Capital expenditures and purchases for real estate properties totaled $17,098,000 in Q1 2024, compared to $19,033,000 in Q1 2023[34]. - The company signed leases for approximately 90% of the units at The Saint June, a 182-unit luxury multi-family project completed in Q4 2023[4]. - Stratus is under contract to sell West Killeen Market for $12.8 million, expected to close in Q2 2024, which will generate approximately $7.2 million of pre-tax net cash proceeds[6]. - The company continues construction on The Saint George and the last six Amarra Villas homes, indicating ongoing development efforts[5]. - Stratus plans to explore the sale of additional retail properties, including Lantana Place – Retail and Magnolia Place – Retail, as part of its strategic initiatives[6].

Financial Performance - In 2023, the formation of a joint venture for the 495-acre Holden Hills residential project resulted in a cash distribution of $35.8 million[19]. - The sale of the mixed-use property Block 21 in 2022 generated net cash proceeds of $112.3 million and a pre-tax gain of $119.7 million[19]. - Revenue from the Real Estate Operations segment accounted for 15% of total revenue in 2023, down from 66% in 2022, primarily due to significant sales of undeveloped properties in 2022[29]. - Revenue from the Leasing Operations segment accounted for 85% of total revenue in 2023, up from 34% in 2022, driven by new leases and the commencement of operations at Magnolia Place and The Saint June[39]. - As of December 31, 2023, consolidated cash and cash equivalents totaled $31.4 million, with an additional $40.5 million available under the revolving credit facility[21]. - The company raised a total of $101.3 million in third-party equity capital for development projects over the last three fiscal years[19]. - The company has approximately 1,600 acres of commercial and residential projects under development or undeveloped land held for future use[18]. - As of December 31, 2023, the company's outstanding debt totaled $175.2 million, with cash and cash equivalents at $31.4 million[107]. - Principal payments due on outstanding debt during 2024 total $68.0 million, with estimated interest payments of approximately $13.6 million[107]. Development Projects - The Saint George, a 316-unit luxury multi-family project, is expected to be completed by the third quarter of 2024[35]. - The company plans to continue its development program focusing on residential and residential-centric mixed-use projects in Texas[20]. - The company anticipates starting construction on the Holden Hills project in 2025, pending development plan revisions[51]. - The Annie B project is planned as a 400-foot tower with approximately 420,000 square feet and 316 luxury multi-family units, with construction commencement dependent on market conditions[59]. - The New Caney project is expected to include approximately 145,000 square feet of retail services and 275 multi-family units, with construction not planned before 2025[68]. - The company has a development portfolio of approximately 1,600 acres of commercial and multi-family and single-family residential projects under development or undeveloped land held for future use[18]. - The company is pursuing rezoning of approximately 216 undeveloped acres from commercial to multi-family, which could enhance future development potential[37]. - The ETJ Law, effective September 1, 2023, is expected to streamline the development permitting process for Holden Hills and Section N, potentially increasing development density[53]. Leasing Operations - Average retail rentals increased to $22.29 per square foot as of December 31, 2023, from $20.27 per square foot a year earlier, representing a growth of 10.05%[40]. - Scheduled expirations of leased retail square footage as of December 31, 2023, indicate 2% in 2024, 0% in 2025, 1% in 2026, 4% in 2027, 8% in 2028, and 85% thereafter[40]. - As of December 31, 2023, signed leases for substantially all retail space at Lantana Place, including anchor tenant Moviehouse & Eatery[57]. - The Saint June project achieved approximately 75% lease signings for its 182 units as of March 25, 2024, with construction completed in Q4 2023[49]. - The Magnolia Place project consists of two fully-leased retail buildings and potential development of approximately 11 acres planned for 275 multi-family units[63]. - Kingwood Place includes 151,877 square feet of retail lease space, with signed leases for substantially all retail space as of December 31, 2023[65]. - West Killeen Market has signed leases for approximately 74% of the retail space as of December 31, 2023[67]. Market Conditions and Risks - The company has faced challenging market conditions due to high interest rates, tightened bank credit, and high inflation, which have adversely impacted projected profitability and project timelines[86]. - The company is vulnerable to concentration risks as operations are primarily located in the Austin, Texas area, which may expose it to negative changes in local economic conditions[92]. - The company relies on third-party project-level equity financing and may face difficulties raising additional capital on acceptable terms due to high costs of debt and equity capital[94]. - Strategic relationships with key tenants are crucial for the company's business, and any deterioration in these relationships could lead to higher vacancy rates and reduced cash flow[95]. - The company is exposed to risks from joint ventures, including potential conflicts with partners and financial obligations that may require additional funding[97]. - Adverse weather conditions and geopolitical instability in Texas markets could negatively impact business operations and financial results[99]. - Rising inflation and interest rates have adversely affected the real estate industry, with continued impacts expected in 2024 and beyond[115]. - The company maintains insurance coverage, but certain catastrophic losses may be uninsurable, potentially leading to significant financial impacts[101]. - Cybersecurity incidents pose risks to the company's operations, with past incidents not resulting in material loss but future threats evolving[104]. Employee and Sustainability Focus - The company has a total of 33 full-time employees as of December 31, 2023, and emphasizes the importance of human capital management and employee well-being[79]. - The company has made significant investments in sustainability, including projects recognized for sustainable practices and partnerships with organizations like the U.S. Green Building Council[80].

Financial Performance - Net loss attributable to common stockholders was $(14.8) million, or $(1.85) per diluted share, for the year ended December 31, 2023, compared to net income of $90.4 million, or $10.99 per diluted share, in 2022[4]. - Total consolidated revenue decreased to $17.3 million in 2023 from $37.5 million in 2022, primarily due to a lack of undeveloped property sales in 2023[6]. - EBITDA for 2023 was $(10.7) million, compared to $(3.1) million in 2022, indicating a decline in operational performance[5]. - The operating loss for 2023 was $16.95 million, compared to a loss of $7.76 million in 2022, reflecting a significant decline in performance[23]. - Net loss from continuing operations was $16.49 million in 2023, compared to a loss of $7.08 million in 2022[23]. - Stratus reported a net loss from continuing operations of $16.5 million for the year ended December 31, 2023, compared to a loss of $7.1 million in 2022[42]. - EBITDA for 2023 was $(10.7) million, a decline from $(3.1) million in 2022, reflecting a significant decrease in operational performance[42]. Assets and Liabilities - Total assets increased to $517.77 million in 2023, up from $445.14 million in 2022, indicating growth in the company's asset base[26]. - Total liabilities increased to $223.16 million in 2023, up from $173.07 million in 2022, indicating higher debt levels[26]. - Total liabilities rose to $223.2 million in 2023 from $173.1 million in 2022, indicating increased financial obligations[52]. - The gross value of assets increased to $694.4 million in 2023 from $645.7 million in 2022, reflecting growth in asset valuation[52]. Stockholders' Equity - Stratus' total stockholders' equity increased by $33.3 million over the past two fiscal years to $191.5 million at December 31, 2023[4]. - Total stockholders' equity fell to $191.5 million in 2023 from $207.2 million in 2022, highlighting a decline in shareholder value[52]. Cash and Capital Expenditures - Cash and cash equivalents at the end of 2023 were $31.40 million, down from $37.67 million at the end of 2022[26]. - The company has $43.4 million in cash and cash equivalents, primarily from the sale of Block 21 in May 2022[39]. - Capital expenditures and purchases for real estate properties totaled $90.4 million in 2023, up from $79.3 million in 2022, reflecting ongoing development efforts[13]. - The company reported capital expenditures of $90.41 million for 2023, compared to $79.27 million in 2022, reflecting ongoing investment in real estate[35]. Revenue Segments - The Real Estate Operations segment generated revenues of $2.55 million in 2023, a decrease of 89.7% from $24.74 million in 2022[35]. - The Leasing Operations segment reported revenues of $14.72 million in 2023, an increase of 15.4% from $12.75 million in 2022[35]. Dividends and Share Repurchase - The company did not declare any dividends in 2023, compared to $4.67 per share in 2022[23]. - Stratus completed a $10.0 million share repurchase program in October 2023, acquiring 389,378 shares at an average price of $25.68 per share[4]. Future Outlook - Stratus anticipates exploring the sale of five stabilized retail properties to return capital to stockholders as market conditions improve[5]. Appraisal Methodology - Stratus' appraisal methodology includes the cost approach, income capitalization approach, and sales comparison approach, ensuring comprehensive asset valuation[46].

Financial Performance - Total revenues for Q3 2023 were $3.7 million, down from $10.0 million in Q3 2022, and $13.0 million for the first nine months of 2023 compared to $24.2 million in the same period of 2022[109]. - Net loss attributable to common stockholders was $2.8 million, or $0.35 per diluted share in Q3 2023, compared to a net loss of $2.4 million, or $0.29 per diluted share in Q3 2022[110]. - The company recorded a net loss of $13.9 million, or $1.69 per diluted share for the first nine months of 2023, contrasting with a net income of $96.5 million, or $11.50 per diluted share in the same period of 2022, which included a $119.7 million pre-tax gain from the sale of Block 21[110]. - As of September 30, 2023, the company reported an operating loss of $3.329 million for the quarter, compared to a loss of $2.830 million in the same period last year[144]. - The company experienced a net loss from continuing operations of $3.217 million for the three months ended September 30, 2023[144]. - Operating income for the first nine months of 2023 was $3.9 million, down from $8.4 million in the same period of 2022, largely due to a gain on sale of assets recognized in 2022[152]. Cash and Debt Management - As of September 30, 2023, cash and cash equivalents totaled $35.2 million, with an additional $40.5 million available under the revolving credit facility[105]. - The company aims to reduce reliance on its revolving credit facility while maximizing cash flow from stabilized assets and managing capital expenditures in a challenging market environment[105]. - Cash used in operating activities was $39.3 million for the first nine months of 2023, down from $49.3 million in the same period of 2022[163]. - Cash provided by financing activities totaled $66.9 million for the first nine months of 2023, compared to cash used of $9.7 million in the same period of 2022[166]. - As of September 30, 2023, total debt increased to $158.5 million from $123.9 million at December 31, 2022[172]. - The maximum borrowing capacity under the Comerica Bank revolving credit facility was $53.8 million, with $40.5 million available after accounting for $13.3 million in letters of credit[172]. - The company had firm commitments totaling approximately $54 million for construction projects as of September 30, 2023[186]. - The company was in compliance with all financial covenants as of September 30, 2023, despite the Jones Crossing project not passing the debt service coverage ratio test in previous quarters[176]. - The company anticipates sufficient cash flow from stabilized commercial properties to cover debt service over the next 12 months[187]. - The company expects to successfully extend or refinance its debt maturing in the next 12 months[188]. Development Projects - The Holden Hills partnership was established with a land contribution valued at $70.0 million from the company and $40.0 million in cash from a partner, resulting in a cash distribution of $35.8 million to the company[111]. - The company plans to develop 475 unique residences in the Holden Hills project, with Phase I expected to consist of 337 luxury residence sites and 12 single-family platted home sites[118]. - Construction on The Saint June, a 182-unit luxury multi-family project, was completed in November 2023, with approximately 25% of units leased as of September 30, 2023[117]. - The company entered into a development agreement for the Tecoma Improvements, estimated to cost approximately $14.7 million, with a reimbursement of 60% of costs to the Holden Hills partnership[122]. - As of September 30, 2023, the company had $9.2 million remaining to complete the Tecoma Improvements[122]. - The company is progressing development plans for Section N, a 570-acre tract, aiming for a dense, mid-rise, mixed-use project[124]. - The Saint George project, a 316-unit luxury multi-family project, is expected to achieve substantial completion by mid-2024[125]. - The Annie B project is planned as a luxury high-rise with 316 residential units, with construction commencement dependent on financing and market conditions[126]. - The retail component of Magnolia Place has signed leases for all retail space in the first phase, totaling 18,582 square feet[132]. Interest and Taxation - Interest expense increased to $3.4 million in third-quarter 2023 from $1.8 million in third-quarter 2022, driven by rising interest rates and higher average debt balances[156]. - The Federal Reserve raised the federal funds target interest rate by 525 basis points during 2022 and through September 2023, impacting the company's borrowing costs due to variable rate debt[137]. - The company recorded a provision for income taxes of $(0.4) million in third-quarter 2023, consistent with the prior year[158]. Share Repurchase and Stock Management - The company executed a $10.0 million share repurchase program completed in October 2023, and a new $5.0 million share repurchase program was approved in November 2023[101]. - The company repurchased 389,378 shares of common stock for a total cost of $10.0 million at an average price of $25.68 per share[169]. - The company is restricted from repurchasing common stock in excess of $1.0 million without prior consent from Comerica Bank[199]. Risks and Forward-Looking Statements - Forward-looking statements are subject to various risks, including economic downturns and changes in market conditions[200]. - The company cautions that actual results may differ materially from anticipated results due to numerous factors[200]. - Future significant development projects will not incur material costs until adequate financing is secured[188]. - The main source of revenue is anticipated to come from property sales and joint venture distributions, which are difficult to predict[188]. - The company generates cash flow from rental revenue and development fees, but does not expect sufficient recurring cash flow to cover general and administrative expenses[188]. - The unique nature and location of the company's assets are expected to provide positive cash flows and net income over time[188]. - Future operating and financial performance will depend on the ability to sell or lease properties profitably and manage debt obligations[189]. - There have been no changes in critical accounting estimates from those discussed in the 2022 Form 10-K[191].

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, 2023 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: 001-37716 Stratus Properties Inc. (Exact name of registrant as specified in its charter) Delaware 72-1211572 (State or other jurisdi ...

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, 2023 incorporation or organization) 212 Lavaca Street, Suite 300 Austin TX 78701 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: 001-37716 Stratus Properties Inc. (Exact name of regist ...