Transcontinental Realty Investors : reports Earnings for Q4 2023 - Form 8-K
March 21, 2024 at 01:12 pm EDT
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Transcontinental Realty Investors, Inc. reports Earnings for Q4 2023
DALLAS (March 21, 2024) -- Transcontinental Realty Investors, Inc. (NYSE:TCI) is reporting its results of operations for the quarter ended December 31, 2023. For the three months ended December 31, 2023, we reported net loss attributable to common shares of $2.6 million or $0.30 per diluted share, compared to a net income of $58.9 million or $6.82 per diluted share for the same period in 2022.
Financial Highlights
•Total occupancy was 77% at December 31, 2023, which includes 92% at our multifamily properties and 49% at our commercial properties.
•On November 6, 2023, we entered into a $25.4 million construction loan to construct a 216 unit multifamily property in McKinney, Texas ("Merano") that bears interest at prime plus 0.25% and matures on November 6, 2028. Merano is expected to be completed in 2025 for a total cost of approximately $51.9 million. As of December 31, 2023, we have incurred a total of $7.2 million in development costs.
•On December 15, 2023, we entered into a $23.5 million construction loan to construct a 216 unit multifamily property in Temple, Texas ("Bandera Ridge") that bears interest at SOFR plus 3% and matures on December 15, 2028. Bandera Ridge is expected to be completed in 2025 for a total cost of approximately $49.6 million. As of December 31, 2023, we have incurred a total of $3.1 million in development costs.
•On February 8, 2024, we extended the maturity of our loan on Windmill Farms to February 28, 2026 at an interest rate of 7.50%.
Financial Results
Rental revenues increased $1.0 million from $11.8 million for the three months ended December 31, 2022 to $12.8 million for the three months ended December 31, 2023. The increase in rental revenue is primarily due to $0.9 million increase at our multifamily properties and $0.1 million at the commercial properties. The increase in revenue from the multifamily properties is primarily due to the acquisition of the VAA Holdback Portfolio in 2022.
Net operating income decreased $2.6 million from net operating income of $0.5 million for three months ended December 31, 2022 to net operating loss of $2.1 million for the three months ended December 31, 2023. The decrease in net operating income is primarily due to an increase of $2.7 million in property operating and depreciation expenses offset in part by the $1.0 million increase in rental revenue as noted above and a decrease of $0.6 million in general administrative and advisory expenses. The increase in property and depreciation expenses is due to the acquisition of the VAA Holdback Portfolio.
Net income attributable to the Company decreased $61.5 million from net income of $58.9 million for the three months ended December 31, 2022 to net loss of $2.6 million for the three months ended December 31, 2023. The decrease in net income is primarily attributed to a $74.7 million decrease in gain on sale, remeasurement or write down of assets offset in part by a decrease of $15.8 million increase in our tax provision. The decrease in gain on our sale or write down of assets and our tax provision is due to the remeasurement of the VAA Holdback Portfolio that was acquired in 2022.
About Transcontinental Realty Investors, Inc.
Transcontinental Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of equity real estate located across the U.S., including office buildings, apartments, shopping centers, and developed and undeveloped land. The Company invests in real estate through direct ownership, leases and partnerships and invests in mortgage loans on real estate. The Company also holds mortgage receivables.
TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
Three Months Ended December 31,
Twelve Months Ended December 31,
2023
2022
2023
2022
Revenues:
Rental revenues
$
12,787
$
11,770
$
47,023
$
34,080
Other income
666
1,014
2,882
2,580
Total revenue
13,453
12,784
49,905
36,660
Expenses:
Property operating expenses
7,316
5,798
27,896
18,339
Depreciation and amortization
4,031
2,846
13,646
9,686
General and administrative
1,363
2,595
9,199
9,943
Advisory fee to related party
2,874
1,089
9,156
7,974
Total operating expenses
15,584
12,328
59,897
45,942
Net operating (loss) income
(2,131)
456
(9,992)
(9,282)
Interest income
3,022
7,086
30,020
24,248
Interest expense
(1,876)
(4,174)
(9,291)
(17,316)
Gain on foreign currency transactions
-
630
993
20,067
Loss on early extinguishment of debt
-
-
(1,710)
(2,805)
Equity in income (loss) from unconsolidated joint venture
262
(2,342)
1,060
468,086
Gain on sale, remeasurement or write down of assets, net
(2,079)
72,616
(1,891)
89,196
Income tax provision
699
(15,085)
(1,939)
(103,190)
Net (loss) income
(2,103)
59,187
7,250
469,004
Net income attributable to noncontrolling interest
(458)
(239)
(1,313)
(742)
Net (loss) income attributable to the Company
$
(2,561)
$
58,948
$
5,937
$
468,262
Earnings per share
Basic and diluted
$
(0.30)
$
6.82
$
0.69
$
54.20
Weighted average common shares used in computing earnings per share
Basic and diluted
8,639,316
8,639,316
8,639,316
8,639,316
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Transcontinental Realty Investors Inc. published this content on
21 March 2024 and is solely responsible for the information contained therein. Distributed by
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21 March 2024 17:11:47 UTC.
Transcontinental Realty Investors, Inc. is a fully integrated, externally managed real estate company. The Company operates through two segments: the acquisition, development, ownership and management of multifamily properties, and the acquisition, development, ownership and management of commercial properties, which are primarily office properties. The services for its commercial segment include primarily rental of office space and other tenant services, including parking and storage space rental. The services for its multifamily segment include primarily rental of apartments and other tenant services, including parking and storage space rental. It holds a diverse portfolio of equity real estate located across the United States, including office buildings, apartments, shopping centers, and developed and undeveloped land. It invests in real estate through direct ownership, leases and partnerships and invests in mortgage loans on real estate. It also holds mortgage receivables.