American Realty Investors, Inc. Reports Earnings for Quarter Ended December 31, 2024
DALLAS--(BUSINESS WIRE)--March 20, 2025--
American Realty Investors, Inc. $(ARL)$ is reporting its results of operations for the three months ended December 31, 2024. For the three months ended December 31, 2024, we reported net loss attributable to common shares of $0.2 million or $0.01 per diluted share, compared to net loss attributable to common shares of $2.1 million or $0.13 per diluted share for the same period in 2023.
Financial Highlights
-- Total occupancy was 81% at December 31, 2024, which includes 94% at our
multifamily properties and 53% at our commercial properties.
-- On October 18, 2024, we completed a 45,000 square foot lease at Stanford
Center. This is the first new lease at the property following our major
renovation of the property. The new lease provides a 14% increase in
occupancy to the property and a 20% increase in rent per square foot over
recent expired leases at the property. The lease is expected to commence
in April 2025.
-- On October 21, 2024, we obtained a $27.5 million construction loan to
finance the development of a 234 unit multifamily property in Dallas,
Texas ("Mountain Creek") that is expected to be completed in 2026 for a
total cost of approximately $49.8 million. The construction loan on
Mountain Creek bears interest at SOFR plus 3.45% and matures on October
20, 2026.
-- On October 31, 2024, we paid $23.4 million to resolve all claims
litigation with David Clapper and related entities related (collectively,
the "Clapper") that had been ongoing since 1999. The matter originally
involved a transaction in 1998 in which we were to acquire eight
multifamily properties from the Clapper. As a result of the settlement,
we accrued a loss on real estate transactions of $23.4 million during the
three and nine months ended December 31, 2024.
-- On December 13, 2024, we sold 30 single family lots from our holdings in
Windmill Farms for $1.4 million, resulting in a gain on sale of $1.1
million.
Financial Results
Rental revenues decreased $1.6 million from $12.8 million for the three months ended December 31, 2023 to $11.2 million for the three months ended December 31, 2024. The decrease in rental revenue is primarily due to a decrease in occupancy at our commercial properties.
Net operating loss decreased $0.4 million from $2.2 million for the three months ended December 31, 2023 to $1.8 million for the three months ended December 31, 2024. Our decrease in net operating loss was due to a $2.4 million decrease in operating expenses offset in part by a $2.0 million decrease in revenues. The decrease in operating expenses is primarily due to a decrease in depreciation for the three months ended December 31, 2024.
Net loss attributable to common shares decreased $2.0 million from $2.1 million for the three months ended December 31, 2023 to $0.2 million for the three months ended December 31, 2024. The decrease in net loss is primarily attributed to a decrease in loss on real estate transactions for the three months ended December 31, 2024.
About American Realty Investors, Inc.
American 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. The Company's primary asset and source of its operating results is its investment in Transcontinental Realty Investors, Inc. $(TCI)$. For more information, visit the Company's website at www.americanrealtyinvest.com.
AMERICAN REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended December Twelve Months Ended December
31, 31,
----------------------------- ----------------------------
2024 2023 2024 2023
--------------- ------------ ------------ --------------
Revenues:
Rental revenues $ 11,222 $ 12,787 $ 44,763 $ 47,023
Other income 817 1,260 2,555 3,477
---------- ---------- ---------- ----------
Total revenue 12,039 14,047 47,318 50,500
---------- ---------- ---------- ----------
Expenses:
Property operating
expenses 6,816 7,316 27,063 27,896
Depreciation and
amortization 2,847 4,031 12,276 13,646
General and
administrative 1,845 1,587 6,395 10,011
Advisory fee to
related party 2,315 3,304 8,225 10,187
---------- ---------- ---------- ----------
Total operating
expenses 13,823 16,238 53,959 61,740
---------- ---------- ---------- ----------
Net operating
loss (1,784) (2,191) (6,641) (11,240)
Interest income 3,940 1,646 19,973 26,847
Interest expense (1,880) (1,928) (7,838) (9,502)
Gain on foreign
currency
transactions - - - 993
Loss on early
extinguishment of
debt - - - (1,710)
Equity in income from
unconsolidated joint
venture 42 296 1,449 3,242
Loss on real estate
transactions (589) (2,079) (23,989) (1,923)
Income tax provision 55 960 3,607 (1,456)
---------- ---------- ---------- ----------
Net (loss) income (216) (3,296) (13,439) 5,251
Net income (loss)
attributable to
noncontrolling
interest 55 1,173 (1,264) (1,283)
---------- ---------- ---------- ----------
Net (loss) income
attributable to
common shares $ (161) $ (2,123) $ (14,703) $ 3,968
========== ========== ========== ==========
Earnings per share
Basic and diluted $ (0.01) $ (0.13) $ (0.91) $ 0.25
========== ========== ========== ==========
Weighted average
common shares used in
computing earnings
per share
Basic and diluted 16,152,043 16,152,043 16,152,043 16,152,043
========== ========== ========== ==========
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CONTACT: American Realty Investors, Inc.
Investor Relations
Erik Johnson (469) 522-4200
investor.relations@americanrealtyinvest.com
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March 20, 2025 17:30 ET (21:30 GMT)