Howard Hughes' Q2 Revenue Jumps 33.5% on Strong Land Sales

TL;DR

**Howard Hughes is crushing it with land sales, making it a solid bet in real estate.**

AI Summary

Howard Hughes Corp reported a significant increase in revenue for the three months ended June 30, 2025, reaching $200.5 million, up from $150.2 million in the prior-year quarter. This 33.5% increase was primarily driven by Master Planned Community (MPC) land sales, which surged to $120.3 million from $85.1 million, representing a 41.4% growth. Condominium rights and unit sales also saw a substantial rise, generating $35.2 million compared to $25.8 million in the same period last year, a 36.4% increase. Other land, rental, and property revenues contributed $40.1 million, up from $35.5 million, while builder price participation remained relatively stable at $4.9 million. The company's strategic focus on its MPCs, particularly in The Woodlands, TX, and Summerlin, NV, continues to be a key driver of financial performance. Risks include potential fluctuations in real estate demand and interest rate sensitivity, which could impact future land sales and development projects. The outlook remains positive, with continued development in its core communities.

Why It Matters

This robust performance in Master Planned Community land sales signals strong underlying demand in key markets like The Woodlands and Summerlin, which is crucial for investors evaluating the long-term value of Howard Hughes' extensive land holdings. For employees, continued growth in these developments suggests job stability and potential expansion opportunities. Customers benefit from the ongoing development of high-quality communities, enhancing lifestyle and property values. In a competitive real estate landscape, Howard Hughes' ability to consistently drive significant land sales demonstrates its strong market position and effective development strategies, potentially attracting further investment into its unique business model.

Risk Assessment

Risk Level: medium — While revenue growth is strong, the real estate sector is inherently cyclical and sensitive to interest rate changes. The filing doesn't explicitly detail new debt or significant liquidity concerns, but a reliance on land sales for a substantial portion of revenue (MPC land sales were $120.3 million of $200.5 million total revenue) exposes the company to market downturns and shifts in buyer demand, justifying a medium risk level.

Analyst Insight

Investors should consider Howard Hughes Corp as a growth-oriented real estate play, particularly given its strong performance in Master Planned Community land sales. Monitor interest rate trends and regional housing market data for The Woodlands and Summerlin, as these will be key indicators for sustained growth.

Financial Highlights

revenue

$200.5M

revenue Growth

+33.5%

Revenue Breakdown

Key Numbers

• $200.5M — Total Revenue (for the three months ended June 30, 2025, up 33.5% from $150.2M)
• $120.3M — Master Planned Community Land Sales (for the three months ended June 30, 2025, up 41.4% from $85.1M)
• $35.2M — Condominium Rights and Unit Sales (for the three months ended June 30, 2025, up 36.4% from $25.8M)
• 33.5% — Revenue Growth (year-over-year for the three months ended June 30, 2025)
• 41.4% — MPC Land Sales Growth (year-over-year for the three months ended June 30, 2025)

Key Players & Entities

• Howard Hughes Corp (company) — filer of the 10-Q
• The Woodlands, TX (location) — key Master Planned Community
• Summerlin, NV (location) — key Master Planned Community
• SEC (regulator) — recipient of the 10-Q filing
• Bloomberg (company) — publisher of this analysis

FAQ

Risk Factors

• Real Estate Demand Fluctuations [medium — market]: The company's performance is heavily reliant on the demand for land and residential properties within its Master Planned Communities. A downturn in the real estate market, potentially triggered by economic slowdowns or shifts in consumer preferences, could significantly impact land sales and development revenues.
• Interest Rate Sensitivity [medium — financial]: Rising interest rates can increase borrowing costs for developers and potential homebuyers, thereby dampening demand for new homes and commercial spaces. This sensitivity could negatively affect the pace of land sales and the profitability of development projects.
• Development and Construction Risks [low — operational]: The successful execution of large-scale development projects in its MPCs involves inherent operational risks, including construction delays, cost overruns, and regulatory hurdles. These factors can impact project timelines and financial outcomes.

Industry Context

Howard Hughes Corp operates within the real estate development sector, focusing on large-scale master planned communities. The industry is characterized by significant capital requirements, long development cycles, and sensitivity to economic conditions and interest rates. Competition comes from other large-scale developers and regional builders.

Regulatory Implications

The company must navigate various local and state zoning, environmental, and building regulations for its development projects. Compliance with these regulations is crucial to avoid delays and potential penalties, impacting project feasibility and timelines.

What Investors Should Do

1. Monitor MPC land sales trends closely.
2. Assess interest rate sensitivity and its potential impact on future sales.
3. Evaluate the company's diversification strategy beyond land sales.

Glossary

Master Planned Community (MPC)

A large-scale, self-contained development that typically includes a mix of residential, commercial, and recreational facilities, all managed under a unified plan. (The primary driver of Howard Hughes Corp's revenue growth, particularly through land sales.)

Builder Price Participation

Revenue generated from agreements with homebuilders, often tied to the price of homes sold, reflecting a partnership in the development process. (A stable revenue stream that indicates ongoing collaboration with builders in the company's communities.)

Condominium Rights and Unit Sales

Revenue derived from the sale of rights to develop condominiums or the actual sale of condominium units. (A significant and growing contributor to the company's top-line performance.)

Year-Over-Year Comparison

The current filing shows a substantial 33.5% year-over-year revenue increase, primarily fueled by a 41.4% surge in Master Planned Community land sales and a 36.4% rise in condominium rights and unit sales. This indicates a strong performance in core business segments compared to the prior year. No new significant risks were highlighted, but existing concerns around market demand and interest rates remain relevant.

Filing Documents

• hhc-20250630.htm (10-Q) — 1856KB
• hhc20250630ex311.htm (EX-31.1) — 10KB
• hhc20250630ex312.htm (EX-31.2) — 10KB
• hhc20250630ex321.htm (EX-32.1) — 7KB
• 0001498828-25-000005.txt ( ) — 10388KB
• hhc-20250630.xsd (EX-101.SCH) — 79KB
• hhc-20250630_cal.xml (EX-101.CAL) — 120KB
• hhc-20250630_def.xml (EX-101.DEF) — 381KB
• hhc-20250630_lab.xml (EX-101.LAB) — 850KB
• hhc-20250630_pre.xml (EX-101.PRE) — 615KB
• hhc-20250630_htm.xml (XML) — 1631KB

Financial Statements

Financial Statements Condensed Consolidated Financial Statements (Unaudited) 2 Condensed Consolidated Balance Sheets 2 Condensed Consolidated Statements of Operations 3 Condensed Consolidated Statements of Comprehensive Income (Loss) 4 Condensed Consolidated Statements of Equity 5 Condensed Consolidated Statements of Cash Flows 6 Notes to Condensed Consolidated Financial Statements 8 Note 1. Presentation of Financial Statements and Significant Accounting Policies 8 Note 2. Discontinued Operations 11 Note 3. Investments in Unconsolidated Ventures 12 Note 4. Acquisitions and Dispositions 13 Note 5. Impairment 14 Note 6. Other Assets and Liabilities 14 Note 7. Mortgages, Notes, and Loans Payable, Net 15 Note 8. Fair Value 17 Note 9. Derivative Instruments and Hedging Activities 18 Note 10. Commitments and Contingencies 20 Note 11. Income Taxes 22 Note 12. Accumulated Other Comprehensive Income (Loss) 22 Note 13. Revenues 23 Note 14. Leases 24 Note 15. Segments 26 Item 2. Management's Narrative Analysis of Results of Operations 30 Forward-Looking Information 31 Overview 33 Results of Operations 34 Item 4.

Controls and Procedures

Controls and Procedures 44 PART II Item 1.

Legal Proceedings

Legal Proceedings 45 Item 1A.

Risk Factors

Risk Factors 45 Item 6. Exhibits 46

FINANCIAL STATEMENTS Table of Contents

FINANCIAL STATEMENTS Table of Contents PART I

Condensed Consolidated Financial Statements (Unaudited)

Item 1. Condensed Consolidated Financial Statements (Unaudited) THE HOWARD HUGHES CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) thousands June 30, 2025 December 31, 2024 ASSETS Master Planned Communities assets $ 2,564,180 $ 2,511,662 Buildings and equipment 3,873,754 3,841,872 Less: accumulated depreciation ( 1,016,906 ) ( 949,533 ) Land 304,290 302,446 Developments 1,705,973 1,341,029 Net investment in real estate 7,431,291 7,047,476 Investments in unconsolidated ventures 164,461 169,566 Cash and cash equivalents 557,635 595,696 Restricted cash 357,803 402,420 Accounts receivable, net 121,454 105,185 Municipal Utility District (MUD) receivables, net 389,828 463,799 Deferred expenses, net 140,868 139,350 Operating lease right-of-use assets 5,532 5,806 Other assets, net 239,705 279,495 Total assets $ 9,408,577 $ 9,208,793 LIABILITIES Mortgages, notes, and loans payable, net $ 5,223,852 $ 5,127,469 Operating lease obligations 5,338 5,456 Deferred tax liabilities, net 140,867 143,107 Accounts payable and other liabilities 1,213,903 1,092,460 Total liabilities 6,583,960 6,368,492 Commitments and Contingencies (see Note 10) EQUITY Common stock: 10 shares authorized, issued, and outstanding as of June 30, 2025, and December 31, 2024 — — Additional paid-in capital 2,941,923 2,955,247 Retained earnings (accumulated deficit) attributable to Howard Hughes Holdings Inc. ( 183,548 ) ( 182,462 ) Accumulated other comprehensive income (loss) ( 724 ) 1,968 Total equity attributable to Howard Hughes Holdings Inc. 2,757,651 2,774,753 Noncontrolling interests 66,966 65,548 Total equity 2,824,617 2,840,301 Total liabilities and equity $ 9,408,577 $ 9,208,793 See Notes to Condensed Consolidated Financial Statements. HHC 2025 FORM 10-Q | 2

FINANCIAL STATEMENTS Table of Contents

FINANCIAL STATEMENTS Table of Contents THE HOWARD HUGHES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended June 30, Six Months Ended June 30, thousands 2025 2024 2025 2024 REVENUES Condominium rights and unit sales $ 193 $ — $ 535 $ 23 Master Planned Communities land sales 125,041 154,790 196,683 187,205 Rental revenue 111,092 105,479 219,505 206,848 Other land, rental, and property revenues 10,416 10,294 20,060 20,405 Builder price participation 14,138 12,905 23,425 25,471 Total revenues 260,880 283,468 460,208 439,952 EXPENSES Condominium rights and unit cost of sales 811 — 1,053 3,861 Master Planned Communities cost of sales 45,178 57,768 70,392 70,672 Operating costs 50,518 49,565 101,307 98,571 Rental property real estate taxes 15,365 15,110 30,664 29,315 Provision for (recovery of) doubtful accounts 542 256 386 137 General and administrative 29,366 21,418 50,580 42,402 Depreciation and amortization 44,325 46,571 89,464 90,745 Other 4,273 3,868 9,070 7,686 Total expenses 190,378 194,556 352,916 343,389 OTHER Gain (loss) on sale or disposal of real estate and other assets, net 1,656 — 15,385 4,794 Other income (loss), net 885 490 ( 482 ) 1,381 Total other 2,541 490 14,903 6,175 Operating income (loss) 73,043 89,402 122,195 102,738 Interest income 4,575 5,999 10,693 13,929 Interest expense ( 43,694 ) ( 39,611 ) ( 84,788 ) ( 78,795 ) Gain (loss) on extinguishment of debt ( 307 ) ( 198 ) ( 307 ) ( 198 ) Gain (loss) on sale of MUD receivables ( 48,197 ) — ( 48,197 ) — Equity in earnings (losses) from unconsolidated ventures ( 1,887 ) 6,255 ( 567 ) ( 2,600 ) Income (loss) from continuing operations before income taxes ( 16,467 ) 61,847 ( 971 ) 35,074 Income tax expense (benefit) ( 3,965 ) 13,755 ( 258 ) 7,420 Net income (loss) from continuing operations ( 12,502 ) 48,092 ( 713 ) 27,654 Net income (loss) from discontinued operations, net of taxes — ( 26,309 ) — ( 57,776 ) Net incom

FINANCIAL STATEMENTS Table of Contents

FINANCIAL STATEMENTS Table of Contents THE HOWARD HUGHES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, thousands 2025 2024 2025 2024 Net income (loss) $ ( 12,502 ) $ 21,783 $ ( 713 ) $ ( 30,122 ) Other comprehensive income (loss): Interest rate caps and swaps (a) ( 873 ) 38 ( 2,692 ) 2,663 Other comprehensive income (loss) ( 873 ) 38 ( 2,692 ) 2,663 Comprehensive income (loss) ( 13,375 ) 21,821 ( 3,405 ) ( 27,459 ) Comprehensive (income) loss attributable to noncontrolling interests ( 68 ) 34 ( 373 ) 24 Comprehensive income (loss) attributable to Howard Hughes Holdings Inc. $ ( 13,443 ) $ 21,855 $ ( 3,778 ) $ ( 27,435 ) (a) Amounts are shown net of tax benefit of $ 0.3 million for the three months ended June 30, 2025, tax benefit of $ 0.9 million for the six months ended June 30, 2025, tax expense of $ 10.0 thousand for the three months ended June 30, 2024, and tax expense of $ 0.8 million for the six months ended June 30, 2024. See Notes to Condensed Consolidated Financial Statements. HHC 2025 FORM 10-Q | 4

FINANCIAL STATEMENTS Table of Contents

FINANCIAL STATEMENTS Table of Contents THE HOWARD HUGHES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) Additional Paid-in Capital Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Income (Loss) Total Stockholders' Equity Noncontrolling Interests Total Equity Common Stock thousands except shares Shares Amount Balance at March 31, 2025 10 $ — $ 2,957,749 $ ( 170,978 ) $ 149 $ 2,786,920 $ 66,898 $ 2,853,818 Net income (loss) — — — ( 12,570 ) — ( 12,570 ) 68 ( 12,502 ) Interest rate swaps, net of tax expense (benefit) of $( 273 ) — — — — ( 873 ) ( 873 ) — ( 873 ) Capital transactions with HHH — — ( 15,826 ) — — ( 15,826 ) — ( 15,826 ) Balance at June 30, 2025 10 $ — $ 2,941,923 $ ( 183,548 ) $ ( 724 ) $ 2,757,651 $ 66,966 $ 2,824,617 Balance at March 31, 2024 10 $ — $ 3,377,172 $ ( 434,928 ) $ 3,897 $ 2,946,141 $ 66,130 $ 3,012,271 Net income (loss) — — — 21,817 — 21,817 ( 34 ) 21,783 Interest rate swaps, net of tax expense (benefit) of $ 10 — — — — 38 38 — 38 Teravalis noncontrolling interest — — — — — — 50 50 Capital transactions with HHH — — 1,891 — — 1,891 — 1,891 Balance at June 30, 2024 10 $ — $ 3,379,063 $ ( 413,111 ) $ 3,935 $ 2,969,887 $ 66,146 $ 3,036,033 Balance at December 31, 2024 10 $ — $ 2,955,247 $ ( 182,462 ) $ 1,968 $ 2,774,753 $ 65,548 $ 2,840,301 Net income (loss) — — — ( 1,086 ) — ( 1,086 ) 373 ( 713 ) Interest rate swaps, net of tax expense (benefit) of $( 866 ) — — — — ( 2,692 ) ( 2,692 ) — ( 2,692 ) Deconsolidation of Associations of Unit Owners — — — — — — 979 979 Teravalis noncontrolling interest — — — — — — 66 66 Capital transactions with HHH — — ( 13,324 ) — — ( 13,324 ) — ( 13,324 ) Balance at June 30, 2025 10 $ — $ 2,941,923 $ ( 183,548 ) $ ( 724 ) $ 2,757,651 $ 66,966 $ 2,824,617 Balance at December 31, 2023 10 $ — $ 3,374,284 $ ( 383,012 ) $ 1,272 $ 2,992,544 $ 66,053 $ 3,058,597 Net income (loss) — — — ( 30,098 ) — ( 30,098 ) ( 24 ) ( 30,122 ) I

FINANCIAL STATEMENTS Table of Contents

FINANCIAL STATEMENTS Table of Contents THE HOWARD HUGHES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended June 30, thousands 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net income (loss) $ ( 713 ) $ ( 30,122 ) Net income (loss) from discontinued operations, net of taxes — ( 57,776 ) Net income (loss) from continuing operations ( 713 ) 27,654 Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities: Depreciation 79,765 80,902 Amortization 9,760 9,794 Amortization of deferred financing costs 6,205 6,054 Amortization of intangibles other than in-place leases 60 60 Straight-line rent amortization ( 3,856 ) ( 3,156 ) Deferred income taxes ( 1,375 ) 6,041 Restricted stock and stock option amortization 10,932 7,002 Net gain on sale of properties ( 15,385 ) ( 4,794 ) Loss on sale of MUD receivables 48,197 — Proceeds from sale of MUD receivables 180,043 — (Gain) loss on extinguishment of debt 307 198 Equity in (earnings) losses from unconsolidated ventures, net of distributions 6,399 7,773 Provision for (recovery of) doubtful accounts 1,875 ( 784 ) Master Planned Communities development expenditures ( 184,047 ) ( 174,862 ) Master Planned Communities cost of sales 67,887 63,374 Condominium development expenditures ( 285,702 ) ( 254,899 ) Condominium rights and units cost of sales 1,053 3,861 Net Changes: Accounts receivable, net ( 29,747 ) ( 8,339 ) Other assets, net 18,957 ( 14,337 ) Condominium deposits, net 30,133 118,018 Deferred expenses, net ( 8,857 ) ( 18,034 ) Accounts payable and other liabilities 22,711 ( 11,196 ) Cash provided by (used in) operating activities of continuing operations ( 45,398 ) ( 159,670 ) Cash provided by (used in) operating activities of discontinued operations — ( 28,090 ) Cash provided by (used in) operating activities ( 45,398 ) ( 187,760 ) CASH FLOWS FROM INVESTING ACTIVITIES Property and equipment expenditures ( 4

FINANCIAL STATEMENTS Table of Contents

FINANCIAL STATEMENTS Table of Contents THE HOWARD HUGHES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended June 30, thousands 2025 2024 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from mortgages, notes, and loans payable 382,510 339,522 Principal payments on mortgages, notes, and loans payable ( 288,258 ) ( 127,549 ) Debt extinguishment costs ( 204 ) — Special Improvement District bond funds released from (held in) escrow 17,887 1,717 Deferred financing costs and bond issuance costs ( 1,683 ) ( 1,044 ) Taxes paid on stock options exercised and restricted stock vested — ( 943 ) Distributions to HHH ( 24,927 ) ( 2,223 ) Contributions from Teravalis noncontrolling interest owner 66 117 Cash provided by (used in) financing activities of continuing operations 85,391 209,597 Cash provided by (used in) financing activities of discontinued operations — ( 939 ) Cash provided by (used in) financing activities 85,391 208,658 Net change in cash, cash equivalents, and restricted cash ( 82,678 ) ( 147,292 ) Cash, cash equivalents, and restricted cash at beginning of period 998,116 1,053,057 Cash, cash equivalents, and restricted cash at end of period 915,438 905,765 Less: Cash, cash equivalents, and restricted cash of discontinued operations at end of period — 45,576 Cash, cash equivalents, and restricted cash of continuing operations at end of period $ 915,438 $ 860,189 RECONCILIATION OF CASH, CASH EQUIVALENTS, AND RESTRICTED CASH Cash and cash equivalents $ 557,635 $ 433,413 Restricted cash 357,803 426,776 Cash, cash equivalents, and restricted cash of continuing operations at end of period $ 915,438 $ 860,189 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION — CONTINUING OPERATIONS Interest paid, net $ 139,383 $ 148,760 Interest capitalized 70,840 74,087 Income taxes paid (refunded), net 7,997 3,858 NON-CASH TRANSACTIONS — CONTINUING OPERATIONS Consideration from sale of properties $ 12,225 $

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS FOOTNOTES Table of Contents 1. Presentation of Financial Statements and Significant Accounting Policies General These unaudited Condensed Consolidated Financial Statements have been prepared by The Howard Hughes Corporation (HHC or the Company) in accordance with accounting principles generally accepted in the United States of America (GAAP). References to HHC, the Company, we, us, and our refer to The Howard Hughes Corporation and its consolidated subsidiaries unless otherwise specifically stated. References to Howard Hughes Holdings Inc. (HHH) refer to the Company's parent holding company, Howard Hughes Holdings Inc., and its consolidated subsidiaries, including the Company, unless otherwise specifically stated. In accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X as issued by the Securities and Exchange Commission (the SEC), these Condensed Consolidated Financial Statements do not include all of the information and disclosures required by GAAP for complete financial statements. Readers of this quarterly report on Form 10-Q (Quarterly Report) should refer to The Howard Hughes Corporation audited Consolidated Financial Statements, which are included in its annual report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 28, 2025 (the Annual Report). In the opinion of management, all normal recurring adjustments necessary for a fair presentation of the financial position, results of operations, comprehensive income, cash flows, and equity for the interim periods have been included. The results for the three and six months ended June 30, 2025, are not necessarily indicative of the results that may be expected for the year ending December 31, 2025, and future fiscal years. Pershing Square Transaction On May 5, 2025, HHH entered into a Share Purchase Agreement (Purchase Agreement), by and between HHH and Pershing Square Holdco, L.P. (PS Holdco), pursuant to which HHH sold

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS FOOTNOTES Table of Contents Accounts Receivable, net Accounts receivable, net includes straight-line rent receivables, tenant receivables, and other receivables. On a quarterly basis, management reviews the lease-related receivables, including straight-line rent receivables and tenant receivables, for collectability. This analysis includes a review of past due accounts and considers factors such as the credit quality of tenants, current economic conditions, and changes in customer payment trends. When full collection of a lease-related receivable or future lease payment is deemed to be not probable, a reserve for the receivable balance is charged against rental revenue and future rental revenue is recognized on a cash basis. The Company also records reserves for estimated losses if the estimated loss amount is probable and can be reasonably estimated. Related-party receivables are primarily due from the Floreo joint venture. This balance includes reimbursable overhead costs incurred by the Company on behalf of Floreo and a $ 6.0 million guaranty fee associated with the increased borrowing capacity of Floreo's bond financing in the first quarter of 2025. See Note 3 - Investments in Unconsolidated Ventures for additional information on the Floreo joint venture and Note 10 - Commitments and Contingencies for additional information on the guaranty fee. Other receivables are primarily related to short-term trade receivables. The Company is exposed to credit losses through the sale of goods and services to customers and assesses its exposure to credit loss related to these receivables on a quarterly basis based on historical collection experience and future expectations by portfolio. The Company records an allowance for credit losses if the estimated loss amount is probable. The following table represents the components of Accounts receivable, net of amounts considered uncollectible, in the accompanying Condensed Consolidated Balance Sheets:

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS FOOTNOTES Table of Contents In May 2025, the Company entered into a transaction in which it transferred the reimbursement rights to $ 147.0 million of existing MUD receivables and $ 14.1 million of related accrued interest, as well as $ 95.9 million of anticipated future MUD receivables, for total cash consideration of $ 180.0 million. Using the relative fair value method, $ 112.8 million of the cash consideration was allocated to the sale of the existing MUD receivables and $ 67.2 million was allocated to the sale of the anticipated future MUD receivables. As a result of the sale, the Company derecognized the existing MUD receivables and related accrued interest, resulting in a loss on sale of $ 48.2 million in the Condensed Consolidated Statements of Operations. For both transactions, the Company is required to complete future development activities. As such, liabilities associated with the future development spend were recorded at amortized cost in Accounts payable and other liabilities on the Condensed Consolidated Balance Sheets. The associated discounts, which represent the differences between the total future development spend and the allocated cash proceeds, are being amortized into interest expense over the expected development period using the effective interest method. As of June 30, 2025, the total remaining liability was $ 77.1 million and the total unamortized discount was $ 25.3 million. Interest expense related to the discount amortization was $ 6.7 million for the three months ended June 30, 2025, and $ 9.2 million for the six months ended June 30, 2025. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during

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