Stratus Properties (STRS) eyes liquidation with 2025 profit jump and NAV of $38.51
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Stratus Properties Inc. reported stronger 2025 results and outlined a major strategic shift toward liquidation. Net income attributable to common stockholders rose to $12.0 million, or $1.47 per diluted share, up from $2.0 million, or $0.24, in 2024. Revenue declined to $29.9 million from $54.2 million, but gains on property sales lifted operating income to $10.8 million versus a loss in 2024, and EBITDA increased to $16.6 million from $4.1 million.
The Board unanimously approved a plan of complete liquidation and dissolution, subject to stockholder approval, with an estimated liquidating distribution range of $29.73 to $37.69 per share. At December 31, 2025, Stratus held $74.3 million of cash and cash equivalents, $143.0 million of consolidated debt and no borrowings on its revolving credit facility, with $17.1 million of availability. After-tax Net Asset Value was $310.7 million, or $38.51 per share235,421 shares for $5.2 million at an average price of $22.14, leaving $19.8 million authorized for additional buybacks.
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Insights
Stratus moves to liquidation with improved earnings and strong liquidity.
Stratus Properties shifted from a development-focused strategy to a plan of complete liquidation and dissolution, subject to stockholder approval. Management estimates potential liquidating distributions in a wide range of $29.73 to $37.69 per share, anchored by an after-tax NAV of $38.51 per share as of December 31, 2025.
Operationally, 2025 results improved despite lower revenue. Net income attributable to common stockholders rose to $12.0 million from $2.0 million, helped by sizeable gains on asset sales such as Lantana Place – Retail and West Killeen Market. EBITDA increased to $16.6 million from $4.1 million, indicating stronger cash‑earnings power before interest, taxes and depreciation.
Balance sheet metrics support an orderly wind‑down. At year‑end 2025, Stratus reported $74.3 million of cash and cash equivalents, consolidated debt of $143.0 million and no borrowings on its revolving credit facility, with $17.1 million of remaining availability. Execution risk now centers on asset sale timing, realized prices relative to appraisals and the cost and duration of the wind‑down, which will be detailed further in the forthcoming proxy statement on the Plan of Liquidation.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 27, 2026
(Exact name of registrant as specified in its charter)
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) | ||||||||||||
| (Address of Principal Executive Offices) | (Zip Code) | ||||||||||
Registrant's telephone number, including area code: (512 ) 478-5788
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
Stratus Properties Inc. (Stratus) issued a press release dated March 27, 2026, announcing its year end December 31, 2025 results. A copy of the press release is furnished hereto as Exhibit 99.1.
Item 7.01. Regulation FD Disclosure.
Stratus posted on its website at stratusproperties.com an investor presentation dated March 27, 2026, containing supplemental financial and operational information regarding the company. In addition to being available on Stratus’ website, the supplemental information is furnished hereto as Exhibit 99.2.
The information furnished in Item 2.02 and Item 7.01 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit Number | Exhibit Title | ||||
99.1 | Press release dated March 27, 2026, titled “Stratus Properties Inc. Reports Year Ended December 31, 2025 Results.” | ||||
99.2 | Stratus Properties Inc. Investor Presentation dated March 27, 2026. | ||||
| 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: March 27, 2026
| NEWS RELEASE | |||||
| NASDAQ Symbol: “STRS” | |||||
| Stratus Properties Inc. | Financial and Media Contact: | ||||
| 212 Lavaca St., Suite 300 | William H. Armstrong III | ||||
| Austin, Texas 78701 | (512) 478-5788 | ||||
STRATUS PROPERTIES INC.
REPORTS YEAR ENDED DECEMBER 31, 2025 RESULTS
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AUSTIN, TX, March 27, 2026 - Stratus Properties Inc. (NASDAQ: STRS), a residential and retail focused real estate company with operations in the Austin, Texas area and other select markets in Texas, today reported year ended December 31, 2025 results.
Highlights and Recent Developments:
•In March 2026, Stratus’ Board of Directors (Board) concluded its strategic alternatives review and unanimously approved a plan of complete liquidation and dissolution of Stratus (Plan of Liquidation). In connection with the Plan of Liquidation, Stratus announced an estimated range of potential liquidating distributions of $29.73 to $37.69 per share. The Plan of Liquidation is subject to approval from Stratus’ stockholders.
•In January 2026, a Stratus subsidiary completed the sale of Kingwood Place, a H-E-B anchored, mixed-use development project in Kingwood, Texas, for $60.8 million. Stratus received $16.2 million from its subsidiary in connection with the sale after selling costs, repayment of the project loan, establishing a reserve for remaining costs of the partnership and distributions to noncontrolling interest holders, and will record a pre-tax gain, net of noncontrolling interests, of approximately $13.4 million in first-quarter 2026.
•In December 2025, a Stratus subsidiary completed the sale of Lantana Place – Retail, part of Stratus’ partially developed, mixed-use Lantana Place project within the Lantana community, located south of Barton Creek in Austin, Texas, for $57.5 million, generating pre-tax net cash proceeds of $26.9 million after selling costs and repayment of the project loan and recorded a pre-tax gain of approximately $27.5 million.
•In March 2026, Stratus received an offer for the retail component, including undeveloped commercial acreage, of Jones Crossing of $46.5 million and is negotiating a sales contract. Stratus also entered into contracts to sell the New Caney land for approximately $12.7 million and one completed Amarra Villas home for $3.6 million, which sales are subject to satisfaction of closing conditions.
•Net income attributable to common stockholders totaled $12.0 million, or $1.47 per diluted share, in the year ended December 31, 2025, compared to net income attributable to common stockholders of $2.0 million, or $0.24 per diluted share, in the year ended December 31, 2024.
•Revenues for 2025 totaled $29.9 million compared to revenues of $54.2 million for 2024. The decrease was primarily a result of sales in 2024 of five Amarra Villas homes for a total of $18.9 million, 47 acres of undeveloped land at Magnolia Place for $14.5 million and one Amarra Drive Phase III lot for $1.4 million, compared with the sales in 2025 of three Amarra Villas for $10.5 million.
•Stratus had $74.3 million of cash and cash equivalents at December 31, 2025 and no amounts drawn on its revolving credit facility. As of December 31, 2025, Stratus had $17.1 million available under the revolving credit facility.
•Through March 20, 2026, Stratus has acquired 235,421 shares of its common stock for a total cost of $5.2 million at an average price of $22.14 per share, and $19.8 million remains available for repurchases under its $25.0 million share repurchase program.
•Net income totaled $2.8 million in the year ended December 31, 2025, compared to net loss of $(1.9) million in the year ended December 31, 2024. Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) totaled $16.6 million in 2025, compared to $4.1 million in 2024. For a reconciliation of net income
(loss) to EBITDA, see the supplemental schedule, “Reconciliation of Non-GAAP Measures – EBITDA,” below.
William H. Armstrong III, Chairman of the Board and Chief Executive Officer of Stratus, stated, “Following the Board’s determination that a plan of liquidation and dissolution is the best path to optimize and return value of our portfolio to stockholders, we are focused on executing the Plan of Liquidation efficiently and prudently. Throughout 2025 and into early 2026, our team delivered meaningful achievements highlighted by the successful sales of West Killeen Market, Lantana Place – Retail and Kingwood Place, which together generated approximately $50.9 million in pre‑tax net cash proceeds to Stratus, including after repaying debt totaling $68.0 million. These transactions, combined with distributions from our Holden Hills Phase 2 partnership and loan refinancings on improved terms, significantly strengthened our liquidity and cash position, resulting in $74.3 million of consolidated cash at year end and no amounts drawn on our revolving credit facility. We also advanced several development initiatives, including continued progress at Holden Hills Phases 1 and 2, completed construction and commenced lease-up of The Saint George, and sold three Amarra Villas homes for $10.5 million. We believe Stratus is well‑positioned to maximize the value of our remaining portfolio and return cash to our stockholders in a tax-efficient manner.”
Summary Financial Results
| Year Ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In Thousands, Except Per Share Amounts) | |||||||||||
| Revenues | |||||||||||
| Real estate operations | $ | 10,598 | $ | 34,887 | |||||||
| Leasing operations | 19,316 | 19,296 | |||||||||
| Total consolidated revenue | $ | 29,914 | $ | 54,183 | |||||||
| Operating income (loss) | |||||||||||
Real estate operations a | $ | (10,722) | $ | 4,727 | |||||||
Leasing operations b | 36,298 | 8,070 | |||||||||
General and administrative expenses c | (14,786) | (14,952) | |||||||||
| Total consolidated operating income (loss) | $ | 10,790 | $ | (2,155) | |||||||
| Net income (loss) | $ | 2,804 | $ | (1,908) | |||||||
Net loss attributable to noncontrolling interests in subsidiaries d | $ | 9,178 | $ | 3,864 | |||||||
Net income attributable to common stockholders | $ | 11,982 | $ | 1,956 | |||||||
| Basic net income per share attributable to common stockholders | $ | 1.49 | $ | 0.24 | |||||||
| Diluted net income per share attributable to common stockholders | $ | 1.47 | $ | 0.24 | |||||||
EBITDA | $ | 16,570 | $ | 4,097 | |||||||
Capital expenditures and purchases and development of real estate properties | $ | 32,956 | $ | 58,661 | |||||||
Municipal utility district (MUD) reimbursements applied to real estate under development e | $ | 409 | $ | — | |||||||
Weighted-average shares of common stock outstanding: | |||||||||||
Basic | 8,035 | 8,059 | |||||||||
| Diluted | 8,147 | 8,189 | |||||||||
a.Includes sales commissions and other revenues together with related expenses. The year ended December 31, 2025 includes a charge of approximately $2.8 million representing previously capitalized architectural, engineering and consulting fees incurred in connection with planning and evaluating a potential project that was terminated in third-quarter 2025. It also includes a $1.0 million charge to write off receivables, included in other assets on the consolidated balance sheet, from owners of properties previously sold by us for a share of historical costs incurred to develop the land. The year
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ended December 31, 2024 includes a charge of $721 thousand to write off previously capitalized costs related to a change in development plans for one property.
b.The year ended December 31, 2025 includes an approximately $27.5 million pre-tax gain on the sale of Lantana Place – Retail, an approximately $5.0 million pre-tax gain on the sale of the West Killeen Market retail project and a portion of a previously deferred gain of $0.2 million related to The Oaks at Lakeway. The year ended December 31, 2024 includes a pre-tax gain on the sale of Magnolia Place – Retail of approximately $1.6 million.
c.Includes employee compensation and other costs.
d.Represents noncontrolling interest partners’ share in the results of the consolidated projects in which they participate.
e.The year ended December 31, 2025 includes receipt of $409 thousand of proceeds related to MUD reimbursements of infrastructure costs incurred for development of The Saint June. This was recorded as a reduction of real estate under development on the consolidated balance sheet.
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Results of Operations
The decrease in revenue from the Real Estate Operations segment in 2025, compared to 2024, primarily reflects the sales in 2024 of five Amarra Villas homes for a total of $18.9 million, 47 acres of undeveloped land at Magnolia Place for $14.5 million and one Amarra Drive Phase III lot for $1.4 million, compared to the sales in 2025 of three Amarra Villas homes for a total of $10.5 million.
Revenue from the Leasing Operations segment in 2025 remained consistent with 2024. While there was an increase in revenue from The Saint June, which was in lease-up during 2024, and The Saint George, which began leasing in second-quarter 2025, this was substantially offset by a decrease in revenue as a result of the sales of West Killeen Market and Lantana Place – Retail during 2025.
Debt and Liquidity
At December 31, 2025, consolidated debt totaled $143.0 million and consolidated cash and cash equivalents totaled $74.3 million, compared with consolidated debt of $162.4 million and consolidated cash and cash equivalents of $20.2 million at December 31, 2024. During 2025, our cash and cash equivalents increased substantially, primarily due to the receipt of a $47.8 million distribution from the formation of the Holden Hills Phase 2 partnership in second-quarter 2025 and the $26.9 million net cash proceeds received from the sale of Lantana Place – Retail in fourth-quarter 2025.
As of December 31, 2025, the maximum amount that could be borrowed under Stratus’ revolving credit facility was $27.1 million, resulting in availability of $17.1 million, net of $10.0 million outstanding letters of credit, and no amount was borrowed.
Purchases and development of real estate properties (included in operating cash flows) and capital expenditures (included in investing cash flows) totaled $33.0 million for 2025, primarily related to the development of Holden Hills Phase 1 and The Saint George, compared with $58.7 million for 2024, primarily related to the development of Holden Hills Phase 1, Amarra Villas, The Saint George and to a lesser extent for tenant improvements at Lantana Place – Retail.
Plan of Liquidation
On March 24, 2026, Stratus’ Board unanimously approved the Plan of Liquidation following conclusion of the strategic review announced on March 11, 2026. The Plan of Liquidation provides that Stratus will be dissolved and will conduct an orderly sale of all or substantially all of its assets and distribute the net proceeds to Stratus’ stockholders, subject to payment of or reasonable provision for Stratus’ liabilities and obligations. In connection with the Plan of Liquidation, Stratus announced an estimated range of potential liquidating distributions of $29.73 to $37.69 per share. The Plan of Liquidation is subject to stockholder approval, and Stratus anticipates that the Plan of Liquidation will be submitted for stockholder approval at a future meeting of stockholders. Additional information regarding the Plan of Liquidation will be made available in a proxy statement (Proxy Statement) to be filed with the U.S. Securities and Exchange Commission (SEC).
Net Asset Value
Stratus’ total stockholders’ equity was $204.5 million at December 31, 2025, compared with $194.7 million at December 31, 2024. Stratus’ after-tax Net Asset Value (NAV) was $310.7 million, or $38.51 per share, as of December 31, 2025, compared with $330.5 million, or $40.38 per share, as of December 31, 2024. The decline in the after-tax NAV primarily reflects ongoing general and administrative expenses and carrying costs together with largely unchanged appraised property values, except for a change in valuation for the retail component of Jones Crossing following the strategic decision to sell the property rather than pursue additional development.
Stratus’ after-tax NAV is a point-in-time estimate of the net value of Stratus’ assets and liabilities as of December 31, 2025. It is not intended to be a representation or guarantee of the amount that stockholders would receive in liquidation. The estimated range of potential liquidating distributions announced in connection with the Plan of Liquidation reflects additional assumptions and estimates, including, among other things, transaction costs, the costs of continuing to operate Stratus and its properties during the asset sale and winding-down process, general and administrative expenses, the establishment of appropriate reserves, and the time required to complete asset sales and wind down Stratus’ affairs. As a result, the estimated range of potential liquidating distributions differs from Stratus’ after-tax NAV as of December 31, 2025.
See “Cautionary Statement,” and the supplemental schedule, “After-Tax Net Asset Value.” Additional after-tax NAV information is available on Stratus’ website at stratusproperties.com/investors/.
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Share Repurchase Program
Through March 20, 2026, Stratus has acquired 235,421 shares of its common stock for a total cost of $5.2 million at an average price of $22.14 per share, and $19.8 million remains available for repurchases under Stratus’ $25.0 million share repurchase program. The repurchase program authorizes Stratus, in management’s and the Capital Committee of the Board’s discretion, to repurchase shares from time to time, subject to market conditions and other factors.
About Stratus
Stratus Properties Inc. is engaged primarily in the entitlement, development, management, leasing and sale of multi-family and single-family residential and commercial real estate properties in the Austin, Texas area and other select markets in Texas. In addition to its developed properties, Stratus has a development portfolio that consists of approximately 1,500 acres of commercial and residential projects under development or undeveloped land held for future use. Stratus’ commercial real estate portfolio consists of stabilized retail properties or future retail and mixed-use development projects with no commercial office space. Stratus generates revenues and cash flows from the sale of its developed and undeveloped properties, the lease of its retail, mixed-use and multi-family properties and development and asset management fees received from its properties.
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CAUTIONARY STATEMENT
This press release contains forward-looking statements in which Stratus discusses factors it believes may affect its future performance and business strategy. Forward-looking statements are all statements other than statements of historical fact, such as plans, projections or expectations related to the Plan of Liquidation, including the availability, timing and amount of potential future distributions to stockholders, the timing of asset sales and whether and when the sales of the retail component of Jones Crossing, the New Caney land and an Amarra Villas home will be completed, and Stratus’ estimated pre-tax proceeds from these sales, inflation, interest rates, tariffs and trade policies, supply chain constraints, Stratus’ ability to pay or refinance its debt obligations as they become due, availability of bank credit, Stratus’ ability to meet its future debt service and other cash obligations, projected future operating loans, advances or capital contributions to Stratus’ joint ventures, potential costs for which The Saint George Apartments, L.P. may be responsible for the remediation and repair of damage caused by the water leak at The Saint George, future cash flows and liquidity, the Austin and Texas real estate markets, the planning, financing, development, construction, completion and stabilization of Stratus’ development projects, including projected costs and estimated times to complete construction, plans to sell, recapitalize or refinance properties and estimated timing for closing properties under contract, future operational and financial performance, MUD reimbursements for infrastructure costs, regulatory matters, including the expected impact of Texas Senate Bill 2038 (the ETJ Law) and related ongoing litigation and the letter from the City of Austin challenging the removal of Stratus’ property from the ETJ, leasing activities, tax rates, future capital expenditures and financing plans, possible joint ventures, partnerships or other strategic relationships, other plans and objectives of management for future operations and development projects, and potential future cash returns to stockholders, including the timing and amount of repurchases under Stratus’ share repurchase program. The words “anticipate,” “may,” “can,” “plan,” “believe,” “potential,” “estimate,” “expect,” “project,” “target,” “intend,” “likely,” “will,” “should,” “to be” and any similar expressions or statements are intended to identify those assertions as forward-looking statements.
Under Stratus’ Fifth Third Bank debt agreements, Stratus is not permitted to repurchase its common stock in excess of $1.0 million or pay dividends on its common stock without Fifth Third Bank’s prior written consent, which Stratus obtained in connection with its current $25.0 million share repurchase program. Any future declaration of dividends or decision to repurchase Stratus’ common stock outside of the approved share repurchase program is at the discretion of Stratus’ Board, subject to restrictions under Stratus’ Fifth Third Bank debt agreements, and will depend on Stratus’ financial results, cash requirements, projected compliance with covenants in its debt agreements, outlook and other factors deemed relevant by the Board. Stratus’ future debt agreements, future refinancings of or amendments to existing debt agreements or other future agreements may restrict Stratus’ ability to declare dividends or repurchase shares.
Stratus cautions readers that forward-looking statements are not guarantees of future performance, and its actual results may differ materially from those anticipated, expected, projected or assumed in the forward-looking statements. Important factors that can cause Stratus’ actual results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, the risks associated with the Plan of Liquidation, including the availability, timing and amount of the distributions to stockholders in connection with the Plan of Liquidation, including changes in the amount and timing of the total liquidating distributions, including as a result of unexpected levels of transaction costs, delayed or terminated closings, liquidation costs or unpaid or additional liabilities and obligations, the amounts that will need to be set aside by Stratus, the adequacy of such reserves to satisfy Stratus’ obligations, risks associated with third-party contracts containing consent and/or other provisions that may be triggered by the Plan of Liquidation, Stratus’ ability to favorably resolve potential tax claims, any litigation matters, including any litigation relating to the Plan of Liquidation and related matters, and other unresolved contingent liabilities, Stratus’ ability to successfully execute the Plan of Liquidation, including the ability to market and sell all or substantially all of Stratus’ assets, the amount of proceeds that might be realized from the sale or other disposition of Stratus’ assets, the application of, and any changes in, applicable tax laws, regulations, administrative practices, principles and interpretations, the incurrence of expenses and the diversion of management’s time in connection with the Plan of Liquidation, Stratus’ ability to retain and hire key personnel, consultants and other resources and maintain relationships with partners, suppliers, employees, stockholders and
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others as it carries out the Plan of Liquidation and on Stratus’ operating results and business generally, the possibility of converting to a liquidating trust or other liquidating entity, the possibility that Stratus’ stockholders will not approve the Plan of Liquidation, the ability of the Board to abandon, modify or delay implementation of the Plan of Liquidation, even after stockholder approval, potential adverse effects on Stratus’ stock price from the announcement, suspension or consummation of the Plan of Liquidation, the occurrence of any event, change or other circumstances, including market, regulatory and other factors, that could give rise to the termination of the Plan of Liquidation, whether Stratus and the purchasers will satisfy their respective obligations and conditions to closing under the agreements or offers, as applicable, for the retail component of Jones Crossing, the New Caney land and an Amarra Villas home in the anticipated timeframe or at all, Stratus’ ability to implement its business strategy successfully, including its ability to develop, construct and sell or lease properties on terms the Board considers acceptable, increases in operating and construction costs, including real estate taxes, maintenance and insurance costs, and the cost of building materials and labor, inflation and elevated interest rates, the effect of changes in tariffs and trade policies, supply chain constraints, Stratus’ ability to pay or refinance its debt, extend maturity dates of its loans or comply with or obtain waivers of financial and other covenants in debt agreements and to meet other cash obligations, availability of bank credit, defaults by contractors and subcontractors, the outcome of Stratus’ analysis and discussions with the insurance company and general contractor regarding responsibility for payment of costs to remediate and repair the damage caused by the water leak at The Saint George, declines in the market value of Stratus’ assets, market conditions or corporate developments that could preclude, impair or delay any opportunities with respect to plans to sell, recapitalize or refinance properties, a decrease in the demand for real estate in select markets in Texas where Stratus operates, particularly in Austin, changes in economic, market, tax, business and geopolitical conditions, potential U.S. or local economic downturn or recession, the availability and terms of financing for development projects and other corporate purposes, Stratus’ ability to collect anticipated rental payments and close projected asset sales, loss of key personnel, Stratus’ ability to enter into and maintain joint ventures, partnerships or other strategic relationships, including risks associated with such joint ventures, any major public health crisis, eligibility for and potential receipt and timing of receipt of MUD reimbursements, industry risks, changes in buyer preferences, potential additional impairment charges, competition from other real estate developers, Stratus’ ability to obtain various entitlements and permits, changes in laws, regulations or the regulatory environment affecting the development of real estate, opposition from special interest groups or local governments with respect to development projects, weather- and climate-related risks, environmental and litigation risks, including the timing and resolution of the challenges to the ETJ Law and Stratus’ ability to implement revised development plans in light of the ETJ Law and the letter from the City of Austin, the failure to attract buyers or tenants for Stratus’ developments or such buyers’ or tenants’ failure to satisfy their purchase commitments or leasing obligations, cybersecurity incidents and other factors described in more detail under the heading “Risk Factors” in Stratus’ Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC.
Investors are cautioned that many of the assumptions upon which Stratus’ forward-looking statements are based are likely to change after the date the forward-looking statements are made. Further, Stratus may make changes to its business plans that could affect its results. Stratus cautions investors that it undertakes no obligation to update any forward-looking statements, which speak only as of the date made, notwithstanding any changes in its assumptions, business plans, actual experience or other changes.
This press release also includes EBITDA and NAV, and financial measures calculated by reference to NAV, including after-tax NAV and after-tax NAV per share, which are not recognized under accounting principles generally accepted in the U.S. (GAAP). Stratus’ management believes these measures can be helpful to investors in evaluating its business because EBITDA is a financial measure frequently used by securities analysts, lenders and others to evaluate Stratus' recurring operating performance. Further, after-tax NAV illustrates current embedded value in Stratus’ real estate, which is carried on its GAAP balance sheet primarily at cost. Management uses after-tax NAV as one of the metrics in evaluating progress on Stratus’ active development plan. EBITDA and after-tax NAV are intended to be performance measures that should not be regarded as more meaningful than GAAP measures. Other companies may calculate EBITDA and after-tax NAV differently. As required by SEC rules, a reconciliation of Stratus' net income (loss) to EBITDA and of Stratus’ total stockholders’ equity to after-tax NAV in its consolidated balance sheet are included in the supplemental schedules of this press release.
IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT
This communication relates to Stratus and the Board’s Plan of Liquidation, and may be deemed to be solicitation material. In connection with the Plan of Liquidation, Stratus intends to file a Proxy Statement with the SEC. The Proxy Statement will be sent to all stockholders of Stratus. Stratus will also file other documents regarding the Plan of Liquidation with the SEC. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND STOCKHOLDERS OF STRATUS ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO AND ANY DOCUMENTS INCORPORATED BY REFERENCE THEREIN) AND ALL OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE PLAN OF LIQUIDATION AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and stockholders of Stratus may obtain copies of the Proxy Statement and other documents that are filed or will be filed by Stratus with the SEC, free of charge, through the website maintained by the SEC at www.sec.gov. Copies of the documents filed by Stratus with the SEC will also be available, free of charge, on Stratus’ website at www.stratusproperties.com or by writing to Stratus Properties Inc. at 212 Lavaca Street, Suite 300, Austin, TX 78701. Stratus includes website addresses in this press release for reference only. The information contained or referenced on Stratus’ website and other websites mentioned in this press release are not a part of this press release and are not deemed incorporated by reference into this press release or any other public filing made with the SEC.
CONTACTS
Media and Investor Contact:
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William H. Armstrong III
(512) 478-5788
Proxy Solicitor:
Innisfree M&A Incorporated
Stockholders may call toll-free: (888) 750-5830
Banks and Brokers may call collect: (212) 750-5833
PARTICIPANTS IN THE SOLICITATION
Stratus, certain of its directors, executive officers and other employees and persons may be deemed to be participants in the solicitation of proxies from Stratus’ stockholders in connection with the Plan of Liquidation and related matters. Information about Stratus’ directors and executive officers and their ownership of Stratus’ common stock is set forth in Stratus’ Definitive Proxy Statement on Schedule 14A Schedule 14A filed with the SEC on April 8, 2025, under the heading “Stock Ownership of Directors, Director Nominees and Executive Officers.” To the extent that holdings of Stratus’ securities have changed since the amounts reported in such proxy statement, the changes have been or will be reflected on Statements of Changes in Beneficial Ownership on Form 4 filed with the SEC. Additional information about the persons who may be considered to be participants in the solicitation of Stratus’ stockholders in connection with the Plan of Liquidation, and any interest they have in the Plan of Liquidation and related matters, may be obtained by reading the Proxy Statement when it becomes available. You may obtain free copies of these documents using the sources indicated above.
A copy of this release is available on Stratus’ website, stratusproperties.com.
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STRATUS PROPERTIES INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands, Except Per Share Amounts)
| Year Ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Revenues: | |||||||||||
| Real Estate Operations | $ | 10,598 | $ | 34,887 | |||||||
| Leasing Operations | 19,316 | 19,296 | |||||||||
| Total revenues | 29,914 | 54,183 | |||||||||
| Cost of sales: | |||||||||||
| Real Estate Operations | 21,120 | 29,979 | |||||||||
| Leasing Operations | 8,978 | 7,470 | |||||||||
| Depreciation and amortization | 6,970 | 5,563 | |||||||||
| Total cost of sales | 37,068 | 43,012 | |||||||||
| General and administrative expenses | 14,786 | 14,952 | |||||||||
| Gain on sale of assets | (32,730) | (1,626) | |||||||||
| Total | 19,124 | 56,338 | |||||||||
| Operating income (loss) | 10,790 | (2,155) | |||||||||
| Interest expense, net | (1,515) | — | |||||||||
| Loss on interest rate cap agreements | (23) | — | |||||||||
| Loss on extinguishment of debt | (549) | (69) | |||||||||
| Other (loss) income, net | (618) | 758 | |||||||||
| Net income (loss) before income taxes | 8,085 | (1,466) | |||||||||
| Provision for income taxes | (5,281) | (442) | |||||||||
| Net income (loss) and total comprehensive income (loss) | 2,804 | (1,908) | |||||||||
Total comprehensive loss attributable to noncontrolling interests a | 9,178 | 3,864 | |||||||||
| Net income and total comprehensive income attributable to common stockholders | $ | 11,982 | $ | 1,956 | |||||||
| Basic net income per share attributable to common stockholders | $ | 1.49 | $ | 0.24 | |||||||
| Diluted net income per share attributable to common stockholders | $ | 1.47 | $ | 0.24 | |||||||
Weighted-average shares of common stock outstanding: | |||||||||||
| Basic | 8,035 | 8,059 | |||||||||
| Diluted | 8,147 | 8,189 | |||||||||
a.Represents noncontrolling interest partners’ share in the results of the consolidated projects in which they participate.
viii
STRATUS PROPERTIES INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands)
| December 31, 2025 | December 31, 2024 | ||||||||||
| ASSETS | |||||||||||
| Cash and cash equivalents | $ | 74,288 | $ | 20,178 | |||||||
| Restricted cash | 335 | 976 | |||||||||
| Real estate held for sale | 8,476 | 11,211 | |||||||||
| Real estate under development | 186,093 | 274,105 | |||||||||
| Land available for development | 74,529 | 63,097 | |||||||||
| Real estate held for investment, net | 167,471 | 103,723 | |||||||||
| Lease right-of-use assets | 10,237 | 10,088 | |||||||||
| Deferred tax assets | 206 | 153 | |||||||||
| Other assets | 4,691 | 11,932 | |||||||||
Assets held for sale a | 37,102 | 37,143 | |||||||||
| Total assets | $ | 563,428 | $ | 532,606 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Liabilities: | |||||||||||
| Accounts payable | $ | 8,589 | $ | 10,061 | |||||||
| Accrued liabilities, including taxes | 10,118 | 7,100 | |||||||||
| Debt | 142,957 | 162,445 | |||||||||
| Lease liabilities | 16,033 | 15,436 | |||||||||
| Deferred gain | 833 | 1,810 | |||||||||
| Other liabilities | 4,432 | 5,252 | |||||||||
Liabilities held for sale a | 33,387 | 32,935 | |||||||||
| Total liabilities | 216,349 | 235,039 | |||||||||
| Commitments and contingencies | |||||||||||
| Equity: | |||||||||||
| Stockholders’ equity: | |||||||||||
| Common stock | 98 | 97 | |||||||||
| Capital in excess of par value of common stock | 202,256 | 200,972 | |||||||||
| Retained earnings | 40,583 | 28,601 | |||||||||
| Common stock held in treasury | (38,451) | (34,965) | |||||||||
| Total stockholders’ equity | 204,486 | 194,705 | |||||||||
| Noncontrolling interests in subsidiaries | 142,593 | 102,862 | |||||||||
| Total equity | 347,079 | 297,567 | |||||||||
| Total liabilities and equity | $ | 563,428 | $ | 532,606 | |||||||
a.The assets and liabilities of Kingwood Place have been reported as held for sale in the consolidated balance sheets for all periods presented.
ix
STRATUS PROPERTIES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
| Year Ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash flow from operating activities: | |||||||||||
| Net income (loss) | $ | 2,804 | $ | (1,908) | |||||||
| Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||||||
| Depreciation and amortization | 6,970 | 5,563 | |||||||||
| Cost of real estate sold | 8,890 | 22,357 | |||||||||
| Loss on interest rate cap agreements | 23 | — | |||||||||
| Loss on extinguishment of debt | 549 | 69 | |||||||||
| Gain on sale of assets | (32,730) | (1,626) | |||||||||
| Stock-based compensation | 1,261 | 1,722 | |||||||||
| Debt issuance cost amortization | 1,405 | 1,352 | |||||||||
| Deferred income taxes | (53) | 20 | |||||||||
| Purchases and development of real estate properties | (24,811) | (29,525) | |||||||||
| Write-off of capitalized project costs | 2,880 | 721 | |||||||||
| Decrease (increase) in other assets | 762 | (43) | |||||||||
| Increase (decrease) in accounts payable, accrued liabilities and other | 2,154 | (4,542) | |||||||||
| Net cash used in operating activities | (29,896) | (5,840) | |||||||||
| Cash flow from investing activities: | |||||||||||
| Capital expenditures | (8,145) | (29,136) | |||||||||
| Proceeds from sale of assets, net of fees | 69,710 | 8,586 | |||||||||
| MUD reimbursements | 409 | — | |||||||||
| Payments on master lease obligations | (948) | (990) | |||||||||
| Net cash provided by (used in) investing activities | 61,026 | (21,540) | |||||||||
| Cash flow from financing activities: | |||||||||||
| Borrowings from credit facility | 4,000 | — | |||||||||
| Payments on credit facility | (4,000) | — | |||||||||
| Borrowings from project loans | 64,679 | 73,648 | |||||||||
| Payments on project and term loans | (86,024) | (57,913) | |||||||||
Payment of dividends | (246) | (376) | |||||||||
| Finance lease principal payments | (17) | (16) | |||||||||
Stock-based awards net payments | (336) | (376) | |||||||||
| Purchases of treasury stock | (3,150) | (1,592) | |||||||||
| Noncontrolling interests’ distributions | (1,845) | — | |||||||||
| Noncontrolling interests’ contributions | 50,754 | 3,600 | |||||||||
| Financing costs | (1,476) | (873) | |||||||||
| Net cash provided by financing activities | 22,339 | 16,102 | |||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 53,469 | (11,278) | |||||||||
| Cash, cash equivalents and restricted cash at beginning of year | 21,154 | 32,432 | |||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 74,623 | $ | 21,154 | |||||||
x
STRATUS PROPERTIES INC.
BUSINESS SEGMENTS
Stratus is engaged primarily in the entitlement, development, management, leasing and sale of multi-family and single-family residential and commercial real estate properties in the Austin, Texas area and other select markets in Texas. Stratus generates revenues primarily from the sale of developed lots or homes and undeveloped land and the lease of developed retail, mixed-use and multi-family properties. Stratus has two operating segments, which are also its two reportable segments: Real Estate Operations and Leasing Operations. The Real Estate Operations segment includes properties under various stages of development: developed for sale, under development and available for development. In this segment, Stratus entitles, develops and sells properties. Properties that Stratus develops and then holds for investment become part of the Leasing Operations segment. Decisions about whether to continue to hold a property for investment or to sell it depend on various factors, including conditions in the real estate markets in which Stratus operates and the estimated fair value of the property, and are primarily driven by the objective of maximizing overall asset value.
The Real Estate Operations segment is comprised of Stratus’ real estate assets, which consists of its properties in Austin, Texas (including the Barton Creek Community, which includes Holden Hills Phases 1 and 2, Amarra multi-family and commercial land, Amarra Villas homes, an Amarra Drive lot and other vacant land; the Circle C community; the Lantana community, which includes a portion of Lantana Place planned for a multi-family phase known as The Saint Julia; and the land for The Annie B); in Lakeway, Texas, located in the greater Austin area (Lakeway); in College Station, Texas (undeveloped land for additional retail space or pad sites and multi-family development at Jones Crossing); and in Magnolia, Texas (potential development of approximately 11 acres planned for future multi-family use), New Caney, Texas (New Caney) and Kingwood, Texas (a vacant retail pad site prior to its sale in first-quarter 2026), each located in the greater Houston area. The New Caney land is under contract to sell, subject to satisfaction or waiver of closing conditions. As discussed below, an offer has been received for the retail component of Jones Crossing, including the undeveloped commercial land.
The Leasing Operations segment is comprised of Stratus’ real estate assets held for investment that are leased or available for lease and includes The Saint George (which was completed in second-quarter 2025 and reclassified from the Real Estate Operations segment to the Leasing Operations segment), The Saint June, the completed retail portion of Jones Crossing, and retail pad sites subject to ground leases at Jones Crossing. The segment also included Kingwood Place (including the retail pad sites subject to ground leases) prior to its sale in first-quarter 2026, the retail portion and retail pad sites subject to ground leases at Lantana Place – Retail prior to its sale in fourth-quarter 2025, West Killeen Market prior to its sale in second-quarter 2025, and the retail portion of Magnolia Place prior to its sale in third-quarter 2024. In March 2026, Stratus received an offer for the retail component, including undeveloped commercial acreage, of Jones Crossing and is negotiating a sales contract. There can be no assurance that a sales contract will be completed or a sale consummated.
Stratus’ chief operating decision maker (CODM) is the chief executive officer. The CODM primarily uses segment profit (loss), which is operating income (loss) excluding general and administrative expenses, determined consistent with the measurement principles of U.S. GAAP, to measure the performance of Stratus’ reportable segments. The segment measure of profit (loss) provides a comprehensive view of the segments’ financial performance. The CODM makes decisions about the allocation of operating and capital resources to each segment based on assessment of the performance of the two segments and considering the capital needs for new and existing projects and the objectives of Stratus’ overall business strategy. General and administrative expenses, which primarily consist of employee salaries, wages and other costs, are managed on a consolidated basis and are not allocated to Stratus’ operating segments. The following segment information reflects management determinations that may not be indicative of what the actual financial performance of each segment would be if it were an independent entity.
xi
Summarized financial information by segment for the year ended December 31, 2025, based on Stratus’ internal financial reporting system utilized by its chief operating decision maker, follows (in thousands):
Real Estate Operations a | Leasing Operations | Total | |||||||||||||||
| Revenue from unaffiliated customers | $ | 10,598 | $ | 19,316 | $ | 29,914 | |||||||||||
| Segment expenses: | |||||||||||||||||
| Cost of real estate sold | (9,595) | (9,595) | |||||||||||||||
| Property taxes and insurance | (1,244) | (3,925) | (5,169) | ||||||||||||||
| Lease expense | (1,140) | (1,140) | |||||||||||||||
Professional fees b | (4,557) | (4,557) | |||||||||||||||
| Maintenance and repairs | (2,031) | (2,031) | |||||||||||||||
| Allocated overhead costs | (2,221) | (2,221) | |||||||||||||||
| Property management fees and payroll | (1,202) | (1,202) | |||||||||||||||
| Utilities | (666) | (666) | |||||||||||||||
Other segment items c | (2,363) | (1,154) | (3,517) | ||||||||||||||
| Depreciation and amortization | (200) | (6,770) | (6,970) | ||||||||||||||
Gain on sale of assets d | — | 32,730 | 32,730 | ||||||||||||||
| Segment (loss) profit | (10,722) | 36,298 | 25,576 | ||||||||||||||
| General and administrative expenses | (14,786) | ||||||||||||||||
| Operating income | 10,790 | ||||||||||||||||
| Interest expense, net | (1,515) | ||||||||||||||||
| Loss on interest rate cap agreements | (23) | ||||||||||||||||
| Loss on extinguishment of debt | (549) | ||||||||||||||||
| Other loss, net | (618) | ||||||||||||||||
| Net income before income taxes | $ | 8,085 | |||||||||||||||
Capital expenditures and purchases and development of real estate properties | $ | 24,811 | $ | 8,145 | $ | 32,956 | |||||||||||
MUD reimbursements applied to real estate under development e | $ | — | $ | 409 | $ | 409 | |||||||||||
a.Includes sales commissions and other revenues together with related expenses.
b.Stratus terminated a lease for a potential development project and recorded a charge of approximately $2.8 million representing previously capitalized architectural, engineering and consulting fees incurred in connection with planning and evaluating the potential project.
c.For Real Estate Operations, primarily includes advertising, property owner association fees, maintenance and utilities. Stratus recorded a $1.0 million charge to write off receivables, included in other assets on the consolidated balance sheet, from owners of properties previously sold by Stratus for a share of historical costs incurred to develop the land. For Leasing Operations, primarily includes amortization of leasing costs, property owner association fees, professional fees and office and computer equipment.
d.Reflects an approximately $27.5 million pre-tax gain on the sale of Lantana Place – Retail, an approximately $5.0 million pre-tax gain on the sale of West Killeen Market and a portion of a previously deferred gain of $0.2 million related to The Oaks at Lakeway.
e.Reflects receipt of $409 thousand of proceeds related to MUD reimbursements of infrastructure costs incurred for development of The Saint June. This was recorded as a reduction of real estate under development on the consolidated balance sheet.
xii
Summarized financial information by segment for the year ended December 31, 2024, based on Stratus’ internal financial reporting system utilized by its chief operating decision maker, follows (in thousands):
Real Estate Operations a | Leasing Operations | Total | |||||||||||||||
| Revenue from unaffiliated customers | $ | 34,887 | $ | 19,296 | $ | 54,183 | |||||||||||
| Segment expenses | |||||||||||||||||
| Cost of real estate sold | (23,894) | (23,894) | |||||||||||||||
| Property taxes and insurance | (1,145) | (3,066) | (4,211) | ||||||||||||||
| Lease expense | (1,140) | (1,140) | |||||||||||||||
Professional fees b | (2,134) | (2,134) | |||||||||||||||
| Maintenance and repairs | (2,024) | (2,024) | |||||||||||||||
| Allocated overhead costs | (977) | (977) | |||||||||||||||
| Property management fees and payroll | (918) | (918) | |||||||||||||||
| Utilities | (478) | (478) | |||||||||||||||
Other segment items c | (689) | (984) | (1,673) | ||||||||||||||
| Depreciation and amortization | (181) | (5,382) | (5,563) | ||||||||||||||
Gain on sale of assets d | — | 1,626 | 1,626 | ||||||||||||||
| Segment profit | 4,727 | 8,070 | 12,797 | ||||||||||||||
| General and administrative expenses | (14,952) | ||||||||||||||||
| Operating loss | (2,155) | ||||||||||||||||
| Loss on extinguishment of debt | (69) | ||||||||||||||||
| Other income, net | 758 | ||||||||||||||||
| Net loss before income taxes | (1,466) | ||||||||||||||||
Capital expenditures and purchases and development of real estate properties | $ | 29,525 | $ | 29,136 | $ | 58,661 | |||||||||||
a.Includes sales commissions and other revenues together with related expenses.
b.Stratus recorded a charge of $721 thousand to write off previously capitalized costs related to a change in development plans for one property.
c.For Real Estate Operations, primarily includes advertising, property owner association fees, maintenance and utilities. For Leasing Operations, primarily includes amortization of leasing costs, property owner association fees, professional fees and office and computer equipment.
d.Reflects a pre-tax gain on the sale of Magnolia Place – Retail of approximately $1.6 million.
Total assets by segment were as follows (in thousands):
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Real Estate Operations | $ | 275,538 | $ | 359,296 | |||||||
Leasing Operations a | 216,051 | 154,370 | |||||||||
Corporate and other b | 71,839 | 18,940 | |||||||||
| Total assets | $ | 563,428 | $ | 532,606 | |||||||
a.Includes assets held for sale at Kingwood Place, which totaled $37.1 million at December 31, 2025, and $37.1 million at December 31, 2024. Kingwood Place was sold in January 2026.
b.Corporate and other includes cash and cash equivalents and restricted cash of $72.9 million and $18.9 million at December 31, 2025 and 2024, respectively. The remaining cash and cash equivalents and restricted cash is reflected in the operating segments’ assets. Corporate and other also includes elimination of intersegment balances.
xiii
RECONCILIATION OF NON-GAAP MEASURES
EBITDA
EBITDA (earnings before interest, taxes, depreciation and amortization) is a non-GAAP financial measure that is frequently used by securities analysts, investors, lenders and others to evaluate companies’ recurring operating performance, including, among other things, profitability before the effect of financing and similar decisions. Because securities analysts, investors, lenders and others use EBITDA, management believes that Stratus’ presentation of EBITDA affords them greater transparency in assessing its financial performance. This information differs from net loss determined in accordance with GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with GAAP. EBITDA may not be comparable to similarly titled measures reported by other companies, as different companies may calculate such measures differently. Management strongly encourages investors to review Stratus’ consolidated financial statements and publicly filed reports in their entirety. A reconciliation of Stratus’ net income (loss) to EBITDA follows (in thousands):
| Year Ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
Net income (loss) | $ | 2,804 | $ | (1,908) | |||||||
| Depreciation and amortization | 6,970 | 5,563 | |||||||||
| Interest expense, net | 1,515 | — | |||||||||
| Provision for income taxes | 5,281 | 442 | |||||||||
| EBITDA | $ | 16,570 | $ | 4,097 | |||||||
AFTER-TAX NET ASSET VALUE
After-tax NAV estimates the market value of Stratus’ assets (gross value) and subtracts the book value of Stratus’ total liabilities reported under GAAP (excluding deferred financing costs presented in debt), value attributable to third party owners, estimated H-E-B, LP (H-E-B) profits interests and awards under the Profit Participation Incentive Plan and Long-Term Incentive Plan, and estimated income taxes computed on the difference between the estimated market values and the tax basis of the assets. Stratus also presents the non-GAAP measure after-tax NAV per share, which is after-tax NAV divided by shares of its common stock outstanding as of December 31, 2025 and 2024, as applicable, plus all outstanding restricted stock units. The computation of Stratus’ after-tax NAV primarily uses third-party appraisals conducted by independent appraisal firms, which were primarily retained by Stratus’ lenders as required under its financing arrangements. The appraisal firms represent in their reports that they employ certified appraisers with local knowledge and expertise who are Members of the Appraisal Institute (MAI) certified by the Appraisal Institute and/or state certified as a Certified General Real Estate Appraiser.
Each appraisal states that it is prepared in conformity with the Uniform Standards of Professional Appraisal Practice and utilizes at least one of the following three approaches to value:
1.the cost approach, which establishes value by estimating the current costs of reproducing the improvements (less loss in value from depreciation) and adding land value to it;
2.the income capitalization approach, which establishes value based on the capitalization of the subject property’s net operating income; and/or
3.the sales comparison approach, which establishes value indicated by recent sales of comparable properties in the market place.
One or more of the approaches may be selected by the appraiser depending on its applicability to the property being appraised. To the extent more than one approach is used, the appraiser performs a reconciliation of the indicated values to determine a final opinion of value for the subject property.
xiv
Significant professional judgment is exercised by the appraiser in determining which inputs are used, which approaches to select, and the weight given to each selected approach in determining a final opinion as to the appraised value of the subject property.
Stratus is a residential and retail focused real estate company and its portfolio of real estate assets includes multi-family and single-family residential and commercial real estate properties. Consequently, each appraisal is unique and certain factors reviewed and evaluated in each appraisal may be particular to the nature of the property being appraised. However, in performing their analyses, the appraisers generally (i) performed site visits to the properties, (ii) performed independent inspections and/or surveys of the market area and neighborhood, (iii) performed a highest and best use analysis, (iv) reviewed property-level information, including, but not limited to, ownership history, location, availability of utilities, topography, land improvements and zoning, and (v) reviewed information from a variety of sources about regional market data and trends applicable to the property being appraised. Depending on the valuation approach utilized, the appraisers may have used one or more of the following: the recent sales prices of comparable properties; market rents for comparable properties; operating and/or holding costs of comparable properties; and market capitalization and discount rates. The values for Kingwood Place, the retail component of Jones Crossing and one of the Amarra Villas homes as of December 31, 2025, were based on the prices in the respective sales contracts or offer, in the case of Jones Crossing, rather than appraised values.
The appraisals of the specified properties are as of the dates so indicated, and the appraised value may be different if prepared as of a current date. As noted above, the appraisers utilize significant professional judgment in determining the appraisal methodology best suited to a particular property and the weight afforded to the various inputs considered, which could vary depending on the appraiser’s evaluation of the property being appraised. Moreover, the opinions expressed in the appraisals are based on estimates and forecasts that are prospective in nature and subject to certain risks and uncertainties. Events may occur that could cause the performance of the properties to materially differ from the estimates utilized by the appraiser, such as changes in the economy, inflation, interest rates, capitalization rates, the financial strength of certain tenants, and the behavior of investors, lenders and consumers. Additionally, in some situations, the opinions and forecasts utilized by the appraiser may be partly based on information obtained from third party sources, which information neither Stratus nor the appraiser verifies. Stratus reviews the appraisals to confirm that the information provided by Stratus to the appraiser is accurately reflected in the appraisal, but Stratus does not validate the methodologies, inputs and professional judgment utilized by the certified appraiser.
The appraised values may not represent fair value, as defined under GAAP. After-tax NAV and after-tax NAV per share may not be equivalent to the enterprise value of Stratus or an appropriate trading price for its common stock for many reasons, including but not limited to the following: (1) income taxes included may not reflect the actual tax amounts that will be due upon the ultimate disposition of the assets; (2) components were calculated as of the dates specified and calculations as of different dates are likely to produce different results; (3) opinions are likely to differ regarding appropriate capitalization rates; and (4) a buyer may pay more or less for Stratus or its real estate assets as a whole than for the sum of the components used to calculate after-tax NAV. Accordingly, after-tax NAV per share is not a representation or guarantee that Stratus’ common stock will or should trade at this amount, that a stockholder would be able to realize this amount in selling Stratus’ shares, that a third party would offer the after-tax NAV per share in an offer to purchase all or substantially all of Stratus’ common stock, or that a stockholder would receive distributions per share equal to the after-tax NAV per share upon Stratus’ liquidation, including pursuant to the Plan of Liquidation. Investors should not rely on the after-tax NAV per share as being an accurate measure of the current fair market value of Stratus’ common stock. Management strongly encourages investors to review Stratus’ consolidated financial statements and publicly filed reports in their entirety.
xv
Below are reconciliations of Stratus’ total stockholders’ equity, the most comparable GAAP measure, to after-tax NAV (in millions).
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Total stockholders’ equity | $ | 204.5 | $ | 194.7 | |||||||
| Less: Total assets | (563.4) | (532.6) | |||||||||
| Add: Noncontrolling interest in subsidiaries | 142.6 | 102.9 | |||||||||
| Total liabilities | (216.3) | (235.0) | |||||||||
| Add: Gross value of assets | 675.8 | 692.6 | |||||||||
| Lease liabilities | 16.1 | 15.4 | |||||||||
| Less: Deferred financing costs presented in liabilities | (1.2) | (1.8) | |||||||||
| 21% corporate tax on built-in gain | (15.3) | (27.4) | |||||||||
| Value attributable to third party ownership | (148.1) | (112.0) | |||||||||
| Estimated H-E-B profits interests and Profit Participation Incentive Plan and Long-Term Incentive Plan awards | (0.2) | (1.3) | |||||||||
| Rounding | (0.1) | — | |||||||||
| After-tax NAV | $ | 310.7 | $ | 330.5 | |||||||
xvi
Investor Presentation March 27, 2026
CAUTIONARY STATEMENT This presentation contains forward-looking statements in which Stratus discusses factors it believes may affect its future performance and business strategy. Forward-looking statements are all statements other than statements of historical fact, such as plans, projections, or expectations related to the plan of complete liquidation and dissolution of Stratus (Plan of Liquidation), including the availability, timing and amount of potential future distributions to stockholders, the timing of asset sales and whether and when the sales of the retail component of Jones Crossing, the New Caney land, and an Amarra Villas home will be completed, and Stratus’ estimated pre-tax proceeds from these sales, inflation, interest rates, tariffs and trade policies, supply chain constraints, Stratus’ ability to pay or refinance its debt obligations as they become due, availability of bank credit, Stratus’ ability to meet its future debt service and other cash obligations, projected future operating loans, advances or capital contributions to Stratus’ joint ventures, potential costs for which The Saint George Apartments, L.P. may be responsible for the remediation and repair of damage caused by the water leak at The Saint George, future cash flows and liquidity, the Austin and Texas real estate markets, the planning, financing, development, construction, completion and stabilization of Stratus’ development projects, including projected costs and estimated times to complete construction, plans to sell, recapitalize, or refinance properties and estimated timing for closing properties under contract, future operational and financial performance, municipal utility district (MUD) reimbursements for infrastructure costs, regulatory matters, including the expected impact of Texas Senate Bill 2038 (the ETJ Law) and related ongoing litigation and the letter from the City of Austin challenging the removal of Stratus’ property from the ETJ, leasing activities, tax rates, future capital expenditures and financing plans, possible joint ventures, partnerships, or other strategic relationships, other plans and objectives of management for future operations and development projects, and potential future cash returns to stockholders, including the timing and amount of repurchases under Stratus’ share repurchase program. The words “anticipates,” “may,” “can,” “plans,” “believes,” “potential,” “estimates,” “expects,” “projects,” “targets,” “intends,” “likely,” “will,” “should,” “to be,” and any similar expressions or statements are intended to identify those assertions as forward-looking statements. Under Stratus’ Fifth Third Bank debt agreements, Stratus is not permitted to repurchase its common stock in excess of $1.0 million or pay dividends on its common stock without Fifth Third Bank’s prior written consent, which Stratus obtained in connection with its current $25.0 million share repurchase program. Any future declaration of dividends or decision to repurchase Stratus’ common stock outside of the approved share repurchase program is at the discretion of Stratus’ Board of Directors (Board), subject to restrictions under Stratus’ Fifth Third Bank debt agreements, and will depend on Stratus’ financial results, cash requirements, projected compliance with covenants in its debt agreements, outlook, and other factors deemed relevant by the Board. Stratus’ future debt agreements, future refinancings of or amendments to existing debt agreements or other future agreements may restrict Stratus’ ability to declare dividends or repurchase shares. Stratus cautions readers that forward-looking statements are not guarantees of future performance, and its actual results may differ materially from those anticipated, expected, projected, or assumed in the forward-looking statements. Important factors that can cause Stratus’ actual results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, the risks associated with the Plan of Liquidation, including the availability, timing, and amount of the distributions to stockholders in connection with the Plan of Liquidation, risks associated with third-party contracts containing consent and/or other provisions that may be triggered by the Plan of Liquidation, litigation matters, Stratus’ ability to successfully execute the Plan of Liquidation, including the ability to market and sell all or substantially all of Stratus’ assets, the amount of proceeds that might be realized from the sale or other disposition of Stratus’ assets, the application of, and any changes in, applicable tax laws, regulations, administrative practices, principles, and interpretations, the incurrence of expenses and the diversion of management’s time in connection with the Plan of Liquidation, Stratus’ ability to retain and hire key personnel, consultants, and other resources and maintain relationships with partners, suppliers, employees, stockholders, and others as it carries out the Plan of Liquidation, the possibility that Stratus’ stockholders will not approve the Plan of Liquidation, the ability of the Board to abandon, modify, or delay implementation of the Plan of Liquidation, even after stockholder approval, potential adverse effects on Stratus’ stock price from the announcement, suspension, or consummation of the Plan of Liquidation, the occurrence of any event, change, or other circumstances, including market, regulatory, and other factors, that could give rise to the termination of the Plan of Liquidation, whether Stratus and the purchasers will satisfy their respective obligations and conditions to closing under the agreements or offers, as applicable, for the retail component of Jones Crossing, the New Caney land, and an Amarra Villas home in the anticipated timeframe or at all, Stratus’ ability to implement its business strategy successfully, including its ability to develop, construct, and sell or lease properties on terms the Board considers acceptable, increases in operating and construction costs, including real estate taxes, maintenance, and insurance costs, and the cost of building materials and labor, inflation and elevated interest rates, the effect of changes in tariffs and trade policies, supply chain constraints, Stratus’ ability to pay or refinance its debt, extend maturity dates of its loans or comply with or obtain waivers of financial and other covenants in debt agreements and to meet other cash obligations, availability of bank credit, defaults by contractors and subcontractors, the outcome of payment of costs to remediate and repair the damage caused by the water leak at The Saint George, declines in the market value of Stratus’ assets, market conditions or corporate developments that could preclude, impair, or delay any opportunities with respect to plans to sell, recapitalize, or refinance properties, a decrease in the demand for real estate in select markets in Texas where Stratus operates, particularly in Austin, changes in economic, market, tax, business, and geopolitical conditions, potential U.S. or local economic downturn or recession, the availability and terms of financing for development projects and other corporate purposes, Stratus’ ability to collect anticipated rental payments and close projected asset sales, loss of key personnel, Stratus’ ability to enter into and maintain joint ventures, partnerships, or other strategic relationships, including risks associated with such joint ventures, any major public health crisis, eligibility for and potential receipt and timing of receipt of MUD reimbursements, industry risks, changes in buyer preferences, potential additional impairment charges, competition from other real estate developers, Stratus’ ability to obtain various entitlements and permits, changes in laws, regulations, or the regulatory environment affecting the development of real estate, opposition from special interest groups or local governments with respect to development projects, weather- and climate-related risks, environmental and litigation risks, including the timing and resolution of the challenges to the ETJ Law and Stratus’ ability to implement revised development plans in light of the ETJ Law and the letter from the City of Austin, the failure to attract buyers or tenants for Stratus’ developments or such buyers’ or tenants’ failure to satisfy their purchase commitments or leasing obligations, cybersecurity incidents, and other factors described in more detail under the heading “Risk Factors” in Stratus’ Annual Report on Form 10-K for the year ended December 31, 2025 (2025 Form 10-K), filed with the U.S. Securities and Exchange Commission (SEC), and in Stratus’ subsequent filings with the SEC. Investors are cautioned that many of the assumptions upon which Stratus’ forward-looking statements are based are likely to change after the date the forward-looking statements are made. Further, Stratus may make changes to its business plans that could affect its results. Stratus cautions investors that it undertakes no obligation to update any forward-looking statements, which speak only as of the date made, notwithstanding any changes in its assumptions, business plans, actual experience, or other changes. This presentation also includes Net Asset Value (NAV), and financial measures calculated by reference to NAV, including after-tax NAV and after-tax NAV per share, which are not recognized under accounting principles generally accepted in the U.S. (U.S. GAAP). These measures are described beginning on page [7] of this presentation. Stratus’ management believes these measures can be helpful to investors in evaluating its business because these measures illustrate current embedded value in Stratus’ real estate, which is carried on its GAAP balance sheet primarily at cost. Management uses these measures, among others, in evaluating progress on Stratus’ active development plan. These measures are intended to be performance measures that should not be regarded as more meaningful than GAAP measures. Other companies may calculate these measures differently. As required by SEC rules, a reconciliation of Stratus’ total stockholders’ equity in its consolidated balance sheet to after-tax NAV is included on pages [7] and [8] of this presentation. Stratus recommends that you read this presentation along with Stratus’ Form 10-K, and subsequent reports filed with the SEC, which include Stratus’ financial information presented in accordance with GAAP and which contain other important information about Stratus. 2
Estimated Net Asset Value 3 As of 12/31/25 Property Note Use Ownership % Value ($MMs except per share amounts) 1 Completed Property 2 Jones Crossing HEB (College Station) (G)(H)(I) R - - 258,842 100% 3 Kingwood Place HEB (I)(J)(K) R - - 151,877 60% 4 Saint George * (H)(J)(L) MF - 316 - 10% 5 Saint June (Amarra/Barton Creek) * (H)(J)(L) MF - 182 - 34% 6 Total Completed Property - 498 410,719 207.6 248.5 51.0 197.3 51.2 (8.2) 42.8 7 Residential and Commercial Property for Sale 8 Amarra Lots (Barton Creek) ** SF 1 - - 100% 9 Amarra Villas (Barton Creek) ** (H)(M) SF 2 - - 100% 10 Magnolia Place (Houston) ** (H) MF - 275 - 100% 11 Total Residential and Commercial Property for Sale 3 275 - 9.5 17.4 16.1 9.4 8.0 (1.7) 14.4 12 Property Under Construction or Active Planning 13 Annie B ** (J)(L) MF - 316 8,325 31% 14 Circle C: Tract 110 ** (O) O - - 660,985 100% 15 Holden Hills Phase 1 ** (J)(L)(N) SF 475 - - 50% 16 Holden Hills Phase 2 ** (J)(L)(N) MU - 1,412 1,560,810 50% 17 Jones Crossing Multifamily (College Station) ** (H) MF - 275 - 100% 18 Lantana Office: Tract G04/GO7 ** (O) O - - 160,000 100% 19 Oaks at Lakeway Back Land ** (I) MF - 270 - 100% 20 Saint Julia (Lantana Multifamily) ** MF - 212 - 100% 21 Total Property Under Construction or Active Planning 475 2,485 2,390,120 205.3 273.9 146.0 240.6 33.2 (4.0) 142.0 NAV (C) Tax Basis (D) Built-In Gain (E) 21% Corporate Tax (F) NAV After Tax Approved Entitlements Resi. Units Multifam. Units Square Feet Carrying Value(A) Gross Value (B)
Estimated Net Asset Value 4 As of 12/31/25 Property Note Use Ownership % Value ($MMs except per share amounts) 22 Property Held for Future Use 23 Barton Creek: Amarra Multifamily and Commercial ** MU 10 - 83,081 100% 24 Barton Creek Blvd./ SW Pkwy Residential (Trav is Cook) ** SF 1 - - 100% 25 Barton Creek Blvd./ Bee Cave Road Entry Corner ** R - - 5,000 100% 26 Barton Creek Fazio Canyons 18th Green Lot ** SF 1 - - 100% 27 Circle C: Tract 102 ** MF - 56 - 100% 28 New Caney ** MU - 275 145,000 100% 29 North Lamar ** (O) O - - 7,285 100% 30 Total Property Held for Future Use 12 331 240,366 22.5 35.6 35.6 26.9 8.7 (1.8) 33.8 31 Other Assets and Liabilities 32 Other Non-Real Estate Assets (P)(Q) - - - 100% 33 Cash (P) - - - 100% 34 MUD Reimbursables (R) - - - 100% 35 Other Liabilities and Corporate Debt (P)(S) - - - 100% 36 Total Other Assets - - - 102.3 100.5 77.3 102.3 (1.8) 0.4 77.7 37 Grand Total 490 3,589 3,041,205 547.3$ 675.8$ 326.0$ 576.5$ 99.3$ (15.3)$ 310.7$ 38 Shares Outstanding (Diluted) (T) 8.067 39 Total Per Share 67.84$ 83.77$ 40.41$ 71.46$ 12.31$ (1.90)$ 38.51$ NAV (C) Tax Basis (D) Built-In Gain (E) 21% Corporate Tax (F) NAV After Tax Carrying Value(A) Gross Value (B) Approved Entitlements Resi. Units Multifam. Units Square Feet
Footnotes 5 MF=Multi-Family, MU=Mixed Use, O=Office, R=Retail, SF=Single-Family For * and **, see Page 9. (A) Carrying values as of December 31, 2025. For a discussion of risks related to our business and properties, see "Risk Factors" in our 2025 Form 10-K and subsequent SEC filings. (B) Gross Value is equal to the appraised value for all assets where an appraisal was obtained. I f an alternative valuation method is used, it is described in a corresponding footnote below. All appraisal reports are dated between 9/9/25 and 11/17/25. All appraisals were commissioned by third party lenders except Barton Creek Blvd./ SW Pkwy Residential (Trav is Cook), Jones Crossing Multifamily, Magnolia Place, New Caney, North Lamar, Saint George, and Saint Julia. Unencumbered projects include Barton Creek Blvd./ SW Pkwy Residential (Trav is Cook), Jones Crossing Multifamily, Magnolia Place, New Caney, North Lamar and Saint Julia. All appraisals directly commissioned by Stratus for encumbered projects employed the same appraisers used by the lenders to underwrite the current loans. (C) See “Cautionary Statement." To calculate NAV, the principal amount of project debt reported under GAAP was subtracted from the Gross Value of the related project. (D) Tax basis represents preliminary carrying values for income tax purposes as of December 31, 2025, and are subject to change until the 2025 federal tax return is filed. (E) Built-in gain represents the excess of Gross Value over the Tax Basis for each asset. (F) The estimated after-tax NAV as of December 31, 2025 was calculated using the federal tax rate of 21% effective as of that date. (G) The estimated value of Jones Crossing HEB is equal to the price from an offer received and for which Stratus is negotiating a sales contract. There can be no assurance that a sales contract will be completed or a sales consummated. (H) The estimated values of the Profit Participation Incentive Plan and Long-Term Incentive Plan awards were deducted from the NAV and NAV After Tax. (I ) The net value and corporate tax attributable to estimated HEB profits interests was deducted from the NAV and NAV After Tax. (J) The estimated value attributable to third party ownership was deducted from the NAV and NAV After Tax. Ownership % is the forecasted share of future cash distributions to Stratus calculated in accordance with the distribution waterfall of each partnership agreement. (K) To estimate the value of Kingwood Place HEB, the sale contract price was used, less closing costs. The ownership share was calculated based on Stratus' share of the cash distribution to the partners following the sale, which accounted for the equity waterfall distribution structure. The sale closed in January 2026 and the project debt was repaid. (L) The principal amounts of operating loans and capital advances were subtracted from the NAV and NAV After Tax. (M) The estimated value of one of the Amarra Villas homes is equal to the price from a signed sales contract, which is subject to satisfaction of closing conditions. The estimated value of the other unit was calculated using an appraisal commissioned by a third party lender for a similar unit. (N) Our current plans include flexibility to develop up to an additional 1,400 multi-family units and 800,000 square feet of commercial space in Holden Hills Phase 2; our ability to develop this increased density is uncertain and dependent on many factors, including the success of the ETJ Law and the overall project profitability after considering the additional costs of redesign work, and infrastructure and other costs related to increasing the project density. An increase in allowable development density should not be v iewed as an indicator of profitability or increased project value, as project valuation is inherently subjective and dependent on a number of market, financial and project-specific factors. In light of the challenges to the ETJ Law, and depending on the outcome of those challenges and a letter from the City of Austin, our development plans for portions of Holden Hills Phases 1 and 2 may need to be modified. See 2025 Form 10-K for more information. (O) Management's current development plans do not include any office space. We are pursuing rezoning of Tract 110 from office to multifamily use and North Lamar from office to residential. Lantana Office GO4/GO7 was successfully rezoned to hotel in February 2026. (P) No third-party appraisal was obtained for Other Non-Real Estate Assets, Cash, Other Liabilities, and Corporate Debt. Gross Value is equal to Carrying Value. (Q) Includes restricted cash, accounts receivable, deposits and prepaids. (R) Gross Value is equal to Carrying Value for all MUD Reimbursables. MUD Reimbursables also include estimated developer interest where applicable. (S) Includes accounts payable, accrued liabilities, accrued property tax, accrued interest, deposits, other liabilities, and corporate revolver, which had no outstanding balance as of December 31, 2025. The corporate revolver is secured by all properties without project debt except Barton Creek Blvd./ SW Pkwy Residential (Trav is Cook), New Caney, North Lamar and Saint Julia. (T) Includes 7.959 million shares of Stratus common stock outstanding and 0.108 million outstanding restricted stock units as of December 31, 2025.
Debt Detail 6 Debt and Rates as of 12/31/2025 ($ millions) Commitment Outstanding (1) % % of TAV Rate Type Recourse Construction/Land Acquisition Annie B Fifth Third Bank $12.6 $11.8 6.7% 1.7% 6.97% Float Holden Hills Phase 1 Fifth Third Bank $26.1 $22.1 12.5% 3.3% 6.97% Float Saint George Fifth Third Bank $56.8 $52.5 29.7% 7.8% 6.27% Float Saint June Texas Capital Bank $33.3 $32.9 18.6% 4.9% 5.87% Float Total Construction/Land Acquisition $128.8 $119.3 67.5% 17.6% 6.36% Revolver Revolver Fifth Third Bank $27.1 $0.0 0.0% 0.0% 6.97% Float Total Revolver $27.1 $0.0 0.0% 0.0% 6.97% Total Recourse $156.0 $119.3 67.5% 17.6% 6.36% Non-Recourse Jones Crossing HEB (College Station) Brighthouse Life Insurance Co. $24.0 $24.0 13.6% 3.6% 5.82% Float Kingwood Place HEB Brighthouse Life Insurance Co. $33.0 $33.0 18.7% 4.9% 5.67% Float Saint June Class B Limited Partner $0.5 $0.5 0.3% 0.1% 8.87% Float Total Non-Recourse $57.5 $57.5 32.5% 8.5% 5.76% Total Debt (1) $213.5 $176.8 100.0% 26.2% 6.17% Total Asset Value (TAV) (2) $675.8 $675.8 Recourse Debt, Construction, Revolver / Total Asset Value 23.1% 17.6% 67.5% Non-Recourse Debt / Total Asset Value 8.5% 8.5% 32.5% Total Debt / Total Asset Value 31.6% 26.2% Floating Rate Debt $213.5 $176.8 100.0% 26.2% 6.17% (1) Outstanding Total Debt represents the principal amounts of debt outstanding as of December 31, 2025. (2) Total Asset Value is the Grand Total (line 37) of the Gross Value column on page 4.
GAAP Reconciliation After-tax NAV estimates the market value of Stratus' assets (gross value) and subtracts the book value of Stratus' total liabilities reported under GAAP (excluding deferred financing costs presented in debt), value attributable to third party owners, estimated H-E-B, LP (H-E-B) profits interests and awards under the Profit Participation Incentive Plan and Long Term Incentive Plan, and estimated income taxes computed on the difference between the estimated market values and the tax basis of the assets. Stratus also presents the non-GAAP measure after-tax NAV per share, which is after-tax NAV divided by shares of its common stock outstanding as of December 31, 2025, plus all outstanding restricted stock units. The computation of Stratus' after-tax NAV primarily uses third-party appraisals conducted by independent appraisal firms, which were primarily retained by Stratus' lenders as required under its financing arrangements. The appraisal firms represent in their reports that they employ certified appraisers with local knowledge and expertise who are Members of the Appraisal Institute (MAI) certified by the Appraisal Institute and/or state certified as a Certified General Real Estate Appraiser. Each appraisal states that it is prepared in conformity with the Uniform Standards of Professional Appraisal Practice and utilizes at least one of the following three approaches to value: 1. the cost approach, which establishes value by estimating the current costs of reproducing the improvements (less loss in value from depreciation) and adding land value to it; 2. the income capitalization approach, which establishes value based on the capitalization of the subject property’s net operating income; and/or 3. the sales comparison approach, which establishes value indicated by recent sales of comparable properties in the market place. One or more of the approaches may be selected by the appraiser depending on its applicability to the property being appraised. To the extent more than one approach is used, the appraiser performs a reconciliation of the indicated values to determine a final opinion of value for the subject property. Significant professional judgment is exercised by the appraiser in determining which inputs are used, which approaches to select, and the weight given to each selected approach in determining a final opinion as to the appraised value of the subject property. Stratus is a residential and retail focused real estate company and its portfolio of real estate assets includes multi-family and single-family residential and commercial real estate properties. Consequently, each appraisal is unique and certain factors reviewed and evaluated in each appraisal may be particular to the nature of the property being appraised. However, in performing their analyses, the appraisers generally (i) performed site visits to the properties, (ii) performed independent inspections and/or surveys of the market area and neighborhood, (iii) performed a highest and best use analysis, (iv) reviewed property-level information, including, but not limited to, ownership history, location, availability of utilities, topography, land improvements and zoning, and (v) reviewed information from a variety of sources about regional market data and trends applicable to the property being appraised. Depending on the valuation approach utilized, the appraisers may have used one or more of the following: the recent sales prices of comparable properties; market rents for comparable properties; operating and/or holding costs of comparable properties; and market capitalization and discount rates. The values for Kingwood Place, the retail component of Jones Crossing and one of the Amarra Villas homes as of December 31, 2025, were based on the prices in the respective sales contracts or offer, in the case of Jones Crossing, rather than appraised values. The appraisals of the specified properties are as of the dates so indicated, and the appraised value may be different if prepared as of a current date. As noted above, the appraisers utilize significant professional judgment in determining the appraisal methodology best suited to a particular property and the weight afforded to the various inputs considered, which could vary depending on the appraiser’s evaluation of the property being appraised. Moreover, the opinions expressed in the appraisals are based on estimates and forecasts that are prospective in nature and subject to certain risks and uncertainties. Events may occur that could cause the performance of the properties to materially differ from the estimates utilized by the appraiser, such as changes in the economy, inflation, interest rates, capitalization rates, the financial strength of certain tenants, and the behavior of investors, lenders and consumers. Additionally, in some situations, the opinions and forecasts utilized by the appraiser may be partly based on information obtained from third party sources, which information neither Stratus nor the appraiser verifies. Stratus reviews the appraisals to confirm that the information provided by Stratus to the appraiser is accurately reflected in the appraisal, but Stratus does not validate the methodologies, inputs and professional judgment utilized by the certified appraiser. 7
GAAP Reconciliation The appraised values may not represent fair value, as defined under GAAP. After-tax NAV and after-tax NAV per share may not be equivalent to the enterprise value of Stratus or an appropriate trading price for its common stock for many reasons, including but not limited to the following: (1) income taxes included may not reflect the actual tax amounts that will be due upon the ultimate disposition of the assets; (2) components were calculated as of the dates specified and calculations as of different dates are likely to produce different results; (3) opinions are likely to differ regarding appropriate capitalization rates; and (4) a buyer may pay more or less for Stratus or its real estate assets as a whole than for the sum of the components used to calculate after-tax NAV. Accordingly, after-tax NAV per share is not a representation or guarantee that Stratus' common stock will or should trade at this amount, that a stockholder would be able to realize this amount in selling Stratus' shares, that a third party would offer the after-tax NAV per share in an offer to purchase all or substantially all of Stratus' common stock, or that a stockholder would receive distributions per share equal to the after-tax NAV per share upon Stratus’ liquidation. Investors should not rely on the after-tax NAV per share as being an accurate measure of the current fair market value of Stratus' common stock. Management strongly encourages investors to review Stratus' consolidated financial statements and publicly filed reports in their entirety. Below is a reconciliation of Stratus’ total stockholders’ equity, the most comparable GAAP measure, to after-tax NAV. 8 Total stockholders’ equity 204.5$ Less: Total assets (563.4) Add: Noncontrolling interests in subsidiaries 142.6 Total liabilities (216.3) Add: Gross value of assets 675.8 Lease liabilities 16.1 Less: Deferred financing costs presented in liabilities (1.2) 21% corporate tax on built-in gain (15.3) Value attribuable to third party ownership (148.1) Estimated HEB profits interests, Profit Participation Incentive Plan, and Long-Term Incentive Plan awards (0.2) Rounding (0.1) After-tax NAV 310.7$ Stratus Properties Inc. Reconciliation of Total Stockholders' Equity to Net Asset Value After Tax December 31, 2025 (In millions)
Key Appraisal Inputs 9 Range In Values Weighted Average * Projects Appraised Primarily Using Income Capitalization Approach Overall Capitalization Rate 4.75% to 5.37% 4.94% ** Projects Appraised Primarily Using Sales Comparison Approach Value per Land Square Foot $5.39 to $17.15 $8.76 Value per Entitled Commercial Square Foot $33.65 to $139.05 $37.81 Value per Building Square Foot $56 to $1,571 $83 Value per Entitled Multifamily Unit $21,944 to $152,500 $43,713 Value per Residential Lot $84,507 to $3,500,000 $248,971 Note: Appraisal inputs were determined by third-party appraisers.
Sensitivity Analysis 10 Total After-Tax NAV ($MMs) Increase or (Decrease) in Estimated 12/31/25 After-Tax NAV ($MMs) After-Tax NAV Per Share Increase or (Decrease) in Estimated 12/31/25 After-Tax NAV Per Share Estimated After-Tax NAV at 12/31/25 $310.7 N/A $38.51 N/A After-Tax NAV with 10% Increase in Estimated Gross Value of Each Specified Property $335.8 $25.1 $41.62 $3.11 After-Tax NAV with 10% Decrease in Estimated Gross Value of Each Specified Property $285.6 ($25.1) $35.40 ($3.11)
FAQ
What is Stratus Properties (STRS) planning with its new Plan of Liquidation?
Stratus’ Board unanimously approved a plan of complete liquidation and dissolution, subject to stockholder approval. The company intends to sell all or substantially all assets and distribute net proceeds to stockholders after paying or reserving for liabilities and obligations.
What liquidating distribution range did Stratus Properties (STRS) estimate for stockholders?
Stratus announced an estimated range of potential liquidating distributions of $29.73 to $37.69 per share. This range reflects assumptions about transaction costs, operating and wind‑down expenses, reserves and the timing and pricing of asset sales.
How did Stratus Properties (STRS) perform financially in 2025 versus 2024?
In 2025, net income attributable to common stockholders was $12.0 million, or $1.47 per diluted share, compared with $2.0 million, or $0.24, in 2024. Revenue fell to $29.9 million from $54.2 million, but gains on property sales drove higher profitability.
What is Stratus Properties’ (STRS) liquidity and debt position at year-end 2025?
At December 31, 2025, Stratus held $74.3 million in cash and cash equivalents and consolidated debt of $143.0 million. The revolving credit facility had no borrowings outstanding and $17.1 million of remaining availability, supported by stronger cash from property sales.
What is Stratus Properties’ (STRS) after-tax Net Asset Value per share?
Stratus reported after-tax Net Asset Value of $310.7 million, or $38.51 per share, as of December 31, 2025. This metric is based on third‑party appraisals and other valuation inputs and is intended as an illustrative, non‑GAAP estimate of embedded real estate value.
How active was Stratus Properties (STRS) in repurchasing its shares?
Through March 20, 2026, Stratus repurchased 235,421 shares of common stock for $5.2 million, at an average price of $22.14 per share. Approximately $19.8 million remained authorized under the $25.0 million share repurchase program.
What were Stratus Properties’ (STRS) key property sale transactions in 2025–early 2026?
Key transactions included selling Lantana Place – Retail for $57.5 million, West Killeen Market with a pre‑tax gain of about $5.0 million, and Kingwood Place for $60.8 million. Stratus also received offers or contracts for Jones Crossing retail, New Caney land and an Amarra Villas home.
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[10-K] STRATUS PROPERTIES INC Files Annual Report
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[8-K] STRATUS PROPERTIES INC Reports Material Event
STRS Stock Data
245.04M
6.46M
Real Estate - Diversified
Land Subdividers & Developers (no Cemeteries)
United States
AUSTIN