Transcontinental Realty Investors Inc. Files 2023 Annual Report

TL;DR

<b>Transcontinental Realty Investors Inc. has filed its 2023 10-K report.</b>

AI Summary

TRANSCONTINENTAL REALTY INVESTORS INC (TCI) filed a Annual Report (10-K) with the SEC on March 21, 2024. Filed 10-K for the fiscal year ending December 31, 2023. Company is Transcontinental Realty Investors Inc., SIC code 6798 (Real Estate Investment Trusts). Incorporated in Nevada, with principal business address in Dallas, TX. Former names include Johnstown Consolidated Realty Trust. The filing is a public document with 100 pages.

Why It Matters

For investors and stakeholders tracking TRANSCONTINENTAL REALTY INVESTORS INC, this filing contains several important signals. This 10-K filing provides a comprehensive overview of TCI's financial performance and operations for the fiscal year 2023. Investors can use this report to assess the company's financial health, strategic direction, and potential risks.

Risk Assessment

Risk Level: low — TRANSCONTINENTAL REALTY INVESTORS INC shows low risk based on this filing. The filing is a standard 10-K annual report, which typically contains routine financial and operational information without immediate market-moving news.

Analyst Insight

Review the detailed financial statements and risk factors within the 10-K to understand Transcontinental Realty Investors Inc.'s performance and outlook.

Key Numbers

• 2023-12-31 — Fiscal Year End (Report period)
• 2024-03-21 — Filed As Of Date (Submission date)
• 1934 Act — SEC Act (Governing legislation)
• 6798 — SIC Code (Industry classification)

Key Players & Entities

• TRANSCONTINENTAL REALTY INVESTORS INC (company) — Filer name
• TCI (company) — Ticker symbol
• Johnstown Consolidated Realty Trust (company) — Former company name
• NV (company) — State of incorporation
• Dallas (company) — Business address city

FAQ

Industry Context

Transcontinental Realty Investors Inc. operates within the Real Estate Investment Trusts (REITs) sector, focusing on acquiring, developing, and managing real estate properties.

Regulatory Implications

The company is subject to regulations governing publicly traded companies and the real estate investment trust industry as per the Securities Exchange Act of 1934.

What Investors Should Do

1. Analyze the full 10-K document for detailed financial statements and management discussion.
2. Identify any new risk factors or changes in existing risks disclosed in the filing.
3. Compare the 2023 financial results with previous years to identify trends.

Key Dates

• 2023-12-31: Fiscal Year End — Defines the reporting period for the 10-K.
• 2024-03-21: Filing Date — Date the 10-K was officially submitted to the SEC.

Year-Over-Year Comparison

This is the initial filing data extracted for the 2023 10-K. Comparative data from the previous filing (2022 10-K) is not yet available in this extract.

Key Financial Figures

• $67.5 million — On January 31, 2023 , we paid off our $67.5 million of Series C bonds. On February 28, 202
• $33.0 million — On March 15, 2023 , we entered into a $33.0 million construction loan to finance the develo
• $14.0 million — May 4, 2023, we paid off the remaining $14.0 million of our Series A Bonds and $28.9 million
• $28.9 million — $14.0 million of our Series A Bonds and $28.9 million of our Series B Bonds, which resulted i
• $1.7 million — loss on early extinguishment of debt of $1.7 million. On August 28, 2023, we paid off our $
• $1.2 million — n. On August 28, 2023, we paid off our $1.2 million loan on Athens . On November 6, 2023 ,
• $25.4 million — On November 6, 2023 , we entered into a $25.4 million construction loan to finance the develo
• $23.5 million — n December 15, 2023 , we entered into a $23.5 million construction loan to finance the develo
• $24.3 million — for single family homes for a total of $24.3 million. We estimate that we will complete the
• $5.0 million — quarter of 2024. During 2023, we spent $5.0 million on the project, which included $0.5 mil
• $0.5 million — million on the project, which included $0.5 million on lot development and $4.5 million on
• $4.5 million — ded $0.5 million on lot development and $4.5 million on reimbursable infrastructure investme
• $55.3 million — 2025 for a total cost of approximately $55.3 million. The cost of construction will be funde
• $1.6 million — he development agreement provides for a $1.6 million fee that will be paid to Pillar over th
• $6.1 million — related party at an appraised value of $6.1 million. As of December 31, 2023, we have incur

Filing Documents

• tci-20231231.htm (10-K) — 1858KB
• tci20231231ex211subsidiari.htm (EX-21.1) — 10KB
• tci20231231ex261.htm (EX-26.1) — 12KB
• tci20231231ex311.htm (EX-31.1) — 10KB
• tci20231231ex321.htm (EX-32.1) — 5KB
• 0000733590-24-000003.txt (&nbsp;) — 9682KB
• tci-20231231.xsd (EX-101.SCH) — 69KB
• tci-20231231_cal.xml (EX-101.CAL) — 93KB
• tci-20231231_def.xml (EX-101.DEF) — 304KB
• tci-20231231_lab.xml (EX-101.LAB) — 599KB
• tci-20231231_pre.xml (EX-101.PRE) — 515KB
• tci-20231231_htm.xml (XML) — 1643KB

Business

Business 3 Item 1A.

Risk Factors

Risk Factors 7 Item 1B. Unresolved Staff Comments 11 Item 2.

Properties

Properties 12 Item 3.

Legal Proceedings

Legal Proceedings 14 Item 4. Mine Safety Disclosures 14 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 15 Item 6.

Selected Financial Data

Selected Financial Data 15 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 15 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 22 Item 8. Consolidated Financial Statements and Supplementary Data 23 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 54 Item 9A.

Controls and Procedures

Controls and Procedures 54 Item 9B. Other Information 54 PART III Item 10. Directors, Executive Officers and Corporate Governance 55 Item 11.

Executive Compensation

Executive Compensation 62 Item 12.

Security Ownership of Certain Beneficial Owners and Management

Security Ownership of Certain Beneficial Owners and Management 62 Item 13. Certain Relationships and Related Transactions, and Director Independence 63 Item 14. Principal Accounting Fees and Services 65 PART IV Item 15. Exhibits, Financial Statement Schedules 67 Item 16. Form 10-K Summary 69

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS Certain Statements in this Form 10-K are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. The words "estimate", "plan", "intend", "expect", "anticipate", "believe", and similar expressions are intended to identify forward-looking statements. The forward-looking statements are found at various places throughout this Report and in the documents incorporated herein by reference. The Company disclaims any intention or obligations to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Although we believe that our expectations are based upon reasonable assumptions, we can give no assurance that our goals will be achieved. Important factors that could cause our actual results to differ from estimates or projections contained in any forward-looking statements are described under Part I, Item 1A. "Risk Factors". PART I

BUSINESS

ITEM 1. BUSINESS General Transcontinental Realty Investors, Inc. (the "Company"), a Nevada Corporation, is a fully integrated externally managed real estate company. We operate high quality multifamily and commercial properties throughout the Southern United States. We also invest in mortgage notes receivable and in land that is either held for appreciation or development. As used herein, the terms "TCI", "the Company", "We", "Our", or "Us" refer to the Company. Corporate Structure Substantially all of our assets are held by our wholly-owned subsidiary, Southern Properties Capital Ltd. ("SPC"), which was formed to raise funds by issuing non-convertible bonds that were listed and traded on the Tel-Aviv Stock Exchange ("TASE"). On November 19, 2018, we formed the Victory Abode Apartments, LLC ("VAA") joint venture with the Macquarie Group ("Macquarie"). In connection with the formation of VAA, we sold a 50% ownership interest in 51 multifamily properties. We account for our in vestment in VAA under the equity method. In 2022, VAA sold 45 of its properties to a third party and distributed the remaining seven properties to us in a liquidating distribution. We own approximately 82.3% of the common stock of Income Opportunity Realty Investors, Inc. ("IOR"), a Nevada Corporation, whose common stock is listed and traded on the NYSE American under the symbol "IOR". Accordingly, we include IOR's financial results in our consolidated financial statements. IOR's primary business is investing in mortgage loans and real estate. Controlling Stockholder American Realty Investors, Inc. ("ARL"), a Nevada Corporation, whose common stock is listed and traded on the NYSE under the symbol "ARL", and its affiliates own more than 80% of our common stock. Accordingly, our financial results are included in the consolidated financial statements of ARL's Form 10-K and tax filings. As described in Part III, Item 13. "Certain Relationships and Related Transactions, and Director Indepen

RISK FACTORS

ITEM 1A. RISK FACTORS An investment in our securities involves various risks. All investors should carefully consider the following risk factors in conjunction with the other information in this report before trading our securities. FACTORS AFFECTING THE INDUSTRY Our operating performance is subject to risks associated with the real estate industry. Real estate investments are subject to various risks, fluctuations and cycles in value and demand, many of which are beyond our control. These events include, but are not limited to: adverse changes in international, national or local economic conditions; inability to rent space on favorable terms, including possible market pressures to offer tenants rent abatements, tenant improvements, early termination rights or below-market renewal options; adverse changes in financial conditions of actual or potential investors, buyers, sellers or tenants; inability to collect rent from tenants; competition from other real estate investors, including other real estate operating companies, publicly-traded REITs and institutional investment funds; reduced tenant demand for office space and residential units from matters such as: (i) trends in space utilization, (ii) changes in the relative popularity of our properties, (iii) the type of space we lease, (iv) purchasing versus leasing, (v) increasing crime or homelessness in our submarkets or (vi) economic recessions; increases in the supply of office space and residential units; fluctuations in interest rates and the availability of credit, which could adversely affect our ability to obtain financing on favorable terms or at all; increases in operating costs, including: (i) insurance costs, (ii) labor costs, (iii) energy prices, (iv) property taxes, and (v) costs of compliance with laws, regulations and governmental policies; utility disruptions; changes in, and changes in enforcement of, laws, regulations and governmental policies, including, without limitation, health

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View this 10-K filing on SEC EDGAR