Transcontinental Realty Investors, Inc. Reports Earnings for Quarter Ended December 31, 2025
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net operating lossfinancial
A net operating loss is when a company’s deductible expenses exceed its taxable income for a period, producing an official tax loss that can be used to reduce future taxable income and lower future cash taxes. For investors it matters because these tax credits are like a savings account of losses the company can “spend” later to boost after‑tax cash flow, which can raise the value of the business—though rules can limit how and when those losses are used.
diluted sharefinancial
Diluted share count is the total number of company shares that would exist if all potential claims that can become stock—such as employee stock options, warrants and convertible bonds—were exercised or converted. Investors use diluted shares to see a more conservative view of ownership and per-share metrics (like earnings per share), because it’s like slicing a cake into more pieces: the same profit spread over more slices makes each slice smaller.
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Diluted earnings per share (EPS) shows how much profit a company makes for each share of stock, assuming all possible shares from stock options or convertible securities are used. It provides a more conservative estimate than basic EPS, accounting for potential share increases that could dilute ownership. Investors use diluted EPS to get a clearer picture of a company's true profitability on a per-share basis.
stabilized occupancytechnical
Stabilized occupancy refers to a property or building reaching a consistent level of occupied space after initial leasing and adjustments. It indicates that the property has settled into its typical occupancy rate, similar to a stable balance in a household budget. This level matters to investors because it helps assess the property's income stability and long-term profitability.
lease-uptechnical
Lease-up is the initial period after a building is finished or renovated when the owner rents out units or space and moves occupancy from empty to the intended level; think of it like stocking and selling items on the shelves of a new store. Investors watch the speed and rent levels achieved during lease-up because they determine how quickly rental income and cash flow start, influence financing and return estimates, and signal demand or risk for the property.
gain on sale of assetsfinancial
Gain on sale of assets is the profit a company records when it sells a long-term item—like property, equipment, or investments—for more than its recorded value on the books. Think of it like selling a used car for more than you expected to get. It matters to investors because it can boost reported earnings and cash flow in the short term, but it is often a one-time event that may not reflect the company’s ongoing operational performance or future revenue.
DALLAS--(BUSINESS WIRE)--
Transcontinental Realty Investors, Inc. (NYSE:TCI) is reporting its results of operations for the three months ended December 31, 2025. For the three months ended December 31, 2025, we reported net income attributable to common shares of $8.3 million or $0.97 per diluted share, compared to $0.1 million or $0.01 per diluted share for the same period in 2024.
Financial Highlights
Total stabilized occupancy was 81% at December 31, 2025, which includes 93% at our multifamily properties and 59% at our commercial properties. Stabilized occupancy excludes Alera, Bandera Ridge and Merano, which are currently in lease-up.
On October 10, 2025, we sold Villas at Bon Secour, a 200 unit multifamily property in Gulf Shores, Alabama, for $28.0 million, which resulted in a gain on sale of $12.2 million. We used the proceeds from the sale to pay off the $18.8 million loan on the property and for general corporate purposes.
Financial Results
Revenues increased $0.3 million from 11.8 million for the three months ended December 31, 2024 to $12.1 million for the three months ended December 31, 2025. The increase in revenue is primarily due to an increase of $0.6 million from our commercial properties offset in part by a decrease of $0.3 million from our multifamily properties. The increase in revenue from our commercial properties is primarily due to an increase in occupancy at Stanford Center and the decrease is to the sale of Villas at Bon Secour in 2025.
Net operating loss increased $1.8 million from $1.7 million for the three months ended December 31, 2024 to $3.5 million for the three months ended December 31, 2025. Our increase in net operating loss was due to a $2.1 million increase in operating expenses offset in part by $0.3 million increase in revenue. The increase in operating expenses is primarily due to an increase in the cost of the lease-up properties during the three months ended December 31, 2025.
Net income attributable to the Company increased $8.2 million from $0.1 million for the three months ended December 31, 2024 to $8.3 million for the three months ended December 31, 2025. The increase in net income is primarily attributed to $12.7 million increase in gain on sale of assets offset in part by a $2.0 million increase in tax provision and the $1.8 million increase in net operating loss. The increase in gain on sale of assets is primarily attributed to the sale of Villas at Bon Secour in 2025.
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)
(Unaudited)
Three Months Ended December 31,
Twelve Months Ended December 31,
2025
2024
2025
2024
Revenues:
Rental revenues
$
11,510
$
11,222
$
46,366
$
44,763
Other income
547
569
2,694
2,307
Total revenue
12,057
11,791
49,060
47,070
Expenses:
Property operating expenses
7,823
6,816
27,885
27,063
Depreciation and amortization
3,696
2,847
12,577
12,276
General and administrative
1,501
1,549
5,830
5,447
Advisory fee to related party
2,525
2,269
9,112
8,058
Total operating expenses
15,545
13,481
55,404
52,844
Net operating loss
(3,488
)
(1,690
)
(6,334
)
(5,774
)
Interest income
3,765
4,642
17,123
21,886
Interest expense
(1,499
)
(1,836
)
(6,669
)
(7,642
)
Loss on early extinguishment of debt
(284
)
-
(284
)
-
Equity in (los) income from unconsolidated joint venture
-
(119
)
-
708
Gain (loss) on sale or write-down of assets, net
12,077
(589
)
17,670
(589
)
Income tax provision
(2,128
)
(112
)
(7,064
)
(1,930
)
Net income
8,443
296
14,432
6,659
Net income attributable to noncontrolling interest
(151
)
(188
)
(629
)
(797
)
Net income attributable to the Company
$
8,292
$
108
$
13,803
$
5,862
Earnings per share
Basic and diluted
$
0.97
$
0.01
$
1.60
$
0.68
Weighted average common shares used in computing earnings per share
