Stratus Properties Inc. Terminates Agreement, Incurs New Obligation

TL;DR

Stratus Properties terminated a deal and took on new debt. Watch closely.

AI Summary

Stratus Properties Inc. announced on January 22, 2025, the termination of a material definitive agreement and the creation of a direct financial obligation. The company, incorporated in Delaware, is involved in land subdivision and development.

Why It Matters

The termination of a definitive agreement and the creation of a new financial obligation could significantly impact Stratus Properties' financial standing and future development plans.

Risk Assessment

Risk Level: medium — The termination of a material agreement and the incurrence of a new financial obligation suggest potential financial distress or strategic shifts that warrant attention.

Key Players & Entities

• STRATUS PROPERTIES INC (company) — Registrant
• Delaware (jurisdiction) — State of Incorporation
• January 22, 2025 (date) — Date of earliest event reported

FAQ

Key Financial Figures

• $0.01 — ich registered Common Stock, par value $0.01 per share STRS The NASDAQ Stock Market
• $29.8 million — an in the aggregate principal amount of $29.8 million (the Loan). The Loan has a maturity d
• $25.7 million — in an event of default. Approximately $25.7 million of the proceeds of the Loan were used t
• $4.1 million — rm 8-K). Of the remaining approximately $4.1 million of proceeds of the Loan, approximately
• $350 thousand — of proceeds of the Loan, approximately $350 thousand were used for the payment of transactio
• $750 thousand — ent of transaction costs, approximately $750 thousand were used to pay 2024 property taxes an
• $3.0 million — y 2024 property taxes and approximately $3.0 million were distributed to Stratus. The fore

Filing Documents

• strs-20250122.htm (8-K) — 33KB
• exhibit101lantanaplacecomm.htm (EX-10.1) — 143KB
• exhibit102lantanaplaceprom.htm (EX-10.2) — 56KB
• exhibit103lantanaplacelimi.htm (EX-10.3) — 77KB
• exhibit991lantanaplacerefi.htm (EX-99.1) — 11KB
• stratuslogoprintaa39.jpg (GRAPHIC) — 14KB
• strs-20250122_g1.jpg (GRAPHIC) — 14KB
• 0000885508-25-000002.txt ( ) — 574KB
• strs-20250122.xsd (EX-101.SCH) — 2KB
• strs-20250122_def.xml (EX-101.DEF) — 7KB
• strs-20250122_lab.xml (EX-101.LAB) — 25KB
• strs-20250122_pre.xml (EX-101.PRE) — 18KB
• strs-20250122_htm.xml (XML) — 3KB

01. Entry into a Material Definitive Agreement

Item 1.01. Entry into a Material Definitive Agreement . Effective January 22, 2025, Lantana Place, L.L.C., a Texas limited liability company (the Company) and a wholly-owned subsidiary of Stratus Properties Inc. (Stratus), as borrower, and Broadway National Bank, as lender, entered into a commercial loan agreement, promissory note, limited guaranty and other related loan documents (collectively, the Loan Documents) to refinance the construction loan for the retail property at Lantana Place, a 99,377-square-foot retail property within Stratus' mixed-use development project located south of Barton Creek in Austin (the Lantana Retail Project). The Loan Documents provide for a first priority commercial mortgage loan in the aggregate principal amount of $29.8 million (the Loan). The Loan has a maturity date of February 1, 2029, with an option to extend the maturity for an additional 12 months, subject to satisfying specified conditions, including the applicable debt service coverage ratio. The Loan bears interest at 6.83 percent until February 1, 2025 and thereafter at the one-month Term Secured Overnight Financing Rate (SOFR) plus 2.35 percent, with a floor of 0.00 percent. Payments of interest only on the Loan are due monthly through January 31 2026. Thereafter, principal and interest payments are due monthly based on a 30-year amortization with the remaining unpaid principal and interest due at maturity. The Company may prepay all or any portion of the Loan without premium or penalty. Amounts repaid under the Loan may not be reborrowed. The Loan is secured by first priority liens on the Lantana Retail Project. Stratus has provided a guaranty limited to certain non-recourse carve-out obligations. The Loan Documents contain affirmative and negative covenants customary for loan agreements of this nature. The Loan Documents contain a financial covenant that the Lantana Retail Project maintain a debt service coverage ratio of at least 1.30 to 1.00 measured by referen

02. Termination of a Material Definitive Agreement

Item 1.02. Termination of a Material Definitive Agreement . On January 23, 2025, in connection with entering into the Loan Documents as described in Item 1.01 above, the Company satisfied in full its obligations under the existing Construction Loan Agreement, as amended, by and between the Company, as borrower, and Southside Bank, as lender, effective April 28, 2017 (as amended, the Existing Lantana Construction Loan Agreement), and such agreement was terminated. Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant . The disclosures set forth in Item 1.01 above are incorporated by reference into this Item 2.03.

01. Other Events

Item 8.01. Other Events . Stratus issued a press release dated January 27, 2025, titled "Stratus Properties Inc. Completes Refinancing of Lantana Place - Retail." A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference into this Item 8.01.

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits . (d) Exhibits. Exhibit Number Exhibit Title 10.1 Commercial Loan Agreement by and among Lantana Place, L.L.C., as borrower, Broadway National Bank, as lender, and Stratus Properties Inc., as guarantor, effective January 22, 2025. 10.2 Promissory Note by and between Lantana Place, L.L.C. and Broadway National Bank dated January 22, 2025. 10.3 Limited Guaranty by Stratus Properties Inc. for the benefit of Broadway National Bank, as lender, dated January 22, 2025 with respect to the Commercial Loan Agreement by and among Lantana Place, L.L.C., as borrower, Broadway National Bank, as lender, and Stratus Properties Inc., as guarantor, effective January 22, 2025. 99.1 Press Release dated January 27, 2025, titled "Stratus Properties Inc. Completes Refinancing of Lantana Place - Retail." 104 The cover page from this Current Report on Form 8-K, formatted in Inline XBRL. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Stratus Properties Inc. By: /s/ Erin D. Pickens Erin D. Pickens Senior Vice President and Chief Financial Officer (authorized signatory and Principal Financial Officer and Principal Accounting Officer) Date: January 27, 2025

View Full Filing

View this 8-K filing on SEC EDGAR