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Transcontinental Realty (NYSE: TCI) Q1 2026 income falls on higher costs

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(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Transcontinental Realty Investors, Inc. reported Q1 2026 net income attributable to common shares of $0.2 million, or $0.02 per share, down from $4.6 million, or $0.53 per share, a year earlier.

Total revenue in the quarter edged up to $12.3 million from $12.0 million, mainly from higher commercial property revenue tied to improved occupancy at Stanford Center. However, total operating expenses rose to $14.3 million from $12.6 million, driving a larger net operating loss of $2.0 million versus $0.6 million.

Stabilized properties were 81% occupied at March 31, 2026, including 93% occupancy in multifamily and 58% in commercial assets. Development properties Alera, Bandera Ridge and Merano had occupancies of 47%, 44% and 42%, respectively. The company also sold 21 lots at Windmill Farms for $1.0 million, generating a $0.8 million gain.

Positive

  • None.

Negative

  • Net income decline: Net income attributable to the Company dropped to $0.2 million in Q1 2026 from $4.6 million a year earlier, as lower gains on asset sales, reduced interest income and higher operating losses more than offset modest revenue growth and a lower tax provision.

Insights

Revenue was stable, but higher lease-up and lower gains cut earnings sharply.

Transcontinental Realty Investors posted Q1 2026 revenue of $12.3 million, slightly above $12.0 million a year earlier, helped by stronger commercial property performance as occupancy at Stanford Center improved. Core rental and other income remained relatively steady.

Profitability weakened as total operating expenses rose to $14.3 million from $12.6 million, pushing net operating loss to $2.0 million from $0.6 million. Management ties this mainly to a $1.4 million increase in operating expenses from lease-up properties, reflecting the cost of bringing development assets online.

Net income attributable to the company fell to $0.2 million from $4.6 million, driven by lower gains on asset sales and write downs, reduced interest income, and higher operating losses, partly offset by a lower tax provision. Future filings will show whether lease-up costs normalize as occupancy at Alera, Bandera Ridge and Merano continues to build.

Item 2.02 Results of Operations and Financial Condition Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01 Financial Statements and Exhibits Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Total revenue Q1 2026 $12,341k Three months ended March 31, 2026, vs $12,008k in 2025
Net income attributable to the Company Q1 2026 $168k Three months ended March 31, 2026, vs $4,618k in 2025
Earnings per share Q1 2026 $0.02 Basic and diluted EPS vs $0.53 in Q1 2025
Total operating expenses Q1 2026 $14,303k Up from $12,643k for three months ended March 31, 2025
Property operating expenses Q1 2026 $7,333k Three months ended March 31, 2026, vs $5,977k in 2025
Gain on sale or write down of assets Q1 2026 $385k Versus $3,891k for the three months ended March 31, 2025
Stabilized property occupancy 81% At March 31, 2026; multifamily 93%, commercial 58%
Windmill Farms lot sales Q1 2026 $1.0M 21 lots sold; generated $0.8M gain on sale
net operating loss financial
"Net operating loss increased approximately $1.3 million from $0.6 million ... to $2.0 million ..."
A net operating loss is when a company’s deductible expenses exceed its taxable income for a period, producing an official tax loss that can be used to reduce future taxable income and lower future cash taxes. For investors it matters because these tax credits are like a savings account of losses the company can “spend” later to boost after‑tax cash flow, which can raise the value of the business—though rules can limit how and when those losses are used.
noncontrolling interest financial
"Net income attributable to noncontrolling interest ... $(156) ... $(163) ..."
The portion of a business owned by investors other than the controlling owner when one company has control of another; it represents outside shareholders’ share of the subsidiary’s assets and profits. For investors, it matters because those outside claims reduce the amount of profit and net assets attributable to the parent owner — similar to saying part of a pizza belongs to someone else — and thus affects earnings, book value and valuation.
Development Properties financial
"Occupancy for our Alera, Bandera Ridge and Merano (collectively, our “Development Properties”) ..."
condemnation financial
"The decrease in gain on sale of real estate transactions is attributed to the condemnation of a parcel of land at Windmill Farms in 2025."
Condemnation is a legal process in which a government or authorized body forces the sale or takeover of private property for public use, typically with payment of compensation, similar to a city taking part of a homeowner’s yard to build a road. For investors, condemnation can change the value or future earnings of real estate, operating facilities or projects, trigger one-time compensation payments, disrupt business operations, or create legal and timing uncertainty that affects a company’s cash flow and stock valuation.
Total revenue $12,341k from $12,008k in the prior-year quarter
Net income attributable to the Company $168k from $4,618k in the prior-year quarter
Earnings per share $0.02 from $0.53 in the prior-year quarter
Net operating loss $1,962k from $635k in the prior-year quarter
Understanding 8-K Material Events →
0000733590false00007335902026-05-062026-05-07

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)May 7, 2026

Transcontinental Realty Investors, Inc.
(Exact name of registrant as specified in its charter)

Nevada001-0924094-6565852
(State or other jurisdiction of 
Incorporation or organization) 		(Commission File Number)(IRS Employer Identification Number)
1603 LBJ Freeway,Suite 800DallasTX75234
(Address of principal executive offices)(Zip Code)
(469) 522-4200
Registrant’s Telephone Number, including area code

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:
 ☐  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 ☐  Soliciting material pursuant to Rule 14a-12 under the Securities Act (17 CFR 230.425)
 ☐  Pre-commencement communications pursuant to Rule 14d-2(b) under the Securities Act (17 CFR 240.14d-2(b))
 ☐  Pre-commencement communications pursuant to Rule 13e-4(c) under the Securities Act (17 CFR 240.413e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common StockTCINYSE
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ((17 CFR 230.405 of or Rule 12b-2 of the Securities Act of 1934 (17 CFR 230.405):
☐  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. ☐



Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition

On May 7, 2026, Transcontinental Realty Investors, Inc. (“TCI” or the “Company”) announced its operational results for the quarter ended March 31, 2026. A copy of the announcement is attached as Exhibit “99.1.”

The information furnished pursuant to Item 2.02 in this Form 8-K, including Exhibit “99.1” attached hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, unless we specifically incorporate it by reference in a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934. We undertake no duty or obligation to publicly update or revise the information furnished pursuant to Item 2.02 of this Current Report on Form 8-K.

Section 9 – Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits


(d) Exhibits.

The following exhibit is furnished with this Report:

Exhibit No.Description
99.1*
Press release datedMay 7, 2026
_________________________
* Furnished herewith






SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
TRANSCONTINENTAL REALTY INVESTORS, INC.
Dated: May 7, 2026By:/s/ ERIK L. JOHNSON
Erik L. Johnson
President and Chief Executive Officer



NEWS RELEASEContact:
Transcontinental Realty Investors, Inc. Investor Relations
FOR IMMEDIATE RELEASEErik Johnson (469) 522-4200 investor.relations@transconrealty-invest.com


Transcontinental Realty Investors, Inc. reports Earnings for Q1 2026

DALLAS (May 7, 2026) -- Transcontinental Realty Investors, Inc. (NYSE:TCI) is reporting its results of operations for the three months ended March 31, 2026. For the three months ended March 31, 2026, we reported net income attributable to common shares of $0.2 million or $0.02 per share, compared to $4.6 million or $0.53 per share for the same period in 2025.

Financial Highlights

•Total occupancy for stabilized properties was 81% at March 31, 2026, which includes 93% at our multifamily properties and 58% at our commercial properties.
•Occupancy for our Alera, Bandera Ridge and Merano (collectively, our “Development Properties”) at March 31, 2026 was 47%, 44% and 42%, respectively.
•During the three months ended March 31, 2026, we sold 21 lots from our holdings in Windmill Farms for $1.0 million, resulting in a gain on sale of $0.8 million.

Financial Results

Revenues increased $0.3 million from $12.0 million for the three months ended March 31, 2025 to $12.3 million for the three months ended March 31, 2026. The increase in revenue is primarily due to an increase of $0.7 million from our commercial properties offset in part by a $0.3 million from our multifamily properties. The increase in revenue from our commercial properties is primarily due to an increase in occupancy at Stanford Center.

Net operating loss increased approximately $1.3 million from $0.6 million for the three months ended March 31, 2025 to $2.0 million for the three months ended March 31, 2026. Our increase in net operating loss was primarily due to a $1.4 million increase in operating expenses from the lease-up properties for the three months ended March 31, 2026.

Net income attributable to the Company decreased approximately $4.5 million from $4.6 million for the three months ended March 31, 2025 to $0.2 million for the three months ended March 31, 2026. The decrease in net income is primarily attributed to a decreases of $3.5 million from gain on sale or write down of assets, $1.4 million in interest income, net and $1.3 million in net operating loss offset in part by a $1.8 million decrease in tax provision. The decrease in gain on sale of real estate transactions is attributed to the condemnation of a parcel of land at Windmill Farms in 2025.






About Transcontinental Realty Investors, Inc.
Transcontinental Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of equity real estate located across the U.S., including office buildings, apartments, shopping centers, and developed and undeveloped land. The Company invests in real estate through direct ownership, leases and partnerships and invests in mortgage loans on real estate. The Company also holds mortgage receivables.



TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended March 31,
20262025
Revenues:
Rental revenues$11,656 $11,427 
Other income685 581 
   Total revenue12,341 12,008 
Expenses:
Property operating expenses7,333 5,977 
Depreciation and amortization3,630 2,883 
General and administrative1,327 1,352 
Advisory fee to related party2,013 2,431 
   Total operating expenses14,303 12,643 
   Net operating loss(1,962)(635)
Interest income4,404 4,628 
Interest expense(2,934)(1,781)
Gain on sale or write down of assets, net385 3,891 
Income tax provision431 (1,322)
Net income324 4,781 
Net income attributable to noncontrolling interest(156)(163)
Net income attributable to the Company$168 $4,618 
Earnings per share
Basic and diluted$0.02 $0.53 
Weighted average common shares used in computing earnings per share
Basic and diluted8,639,316 8,639,316 





Source: View Original Filing on SEC EDGAR

FAQ

How did Transcontinental Realty Investors (TCI) perform financially in Q1 2026?

Transcontinental Realty Investors reported net income attributable to common shares of $0.2 million, or $0.02 per share, in Q1 2026. This compares with $4.6 million, or $0.53 per share, for the same quarter in 2025, reflecting weaker overall profitability.

What were Transcontinental Realty Investors (TCI) Q1 2026 revenues?

Q1 2026 total revenue was $12.3 million, up slightly from $12.0 million in Q1 2025. The increase was primarily driven by a $0.7 million rise in revenue from commercial properties, partly offset by lower contributions from multifamily properties.

What occupancy levels did Transcontinental Realty Investors (TCI) report for March 31, 2026?

As of March 31, 2026, stabilized properties had 81% total occupancy, including 93% at multifamily and 58% at commercial properties. Development properties Alera, Bandera Ridge and Merano reported occupancies of 47%, 44% and 42%, respectively, during their lease-up phase.

Why did Transcontinental Realty Investors (TCI) net operating loss increase in Q1 2026?

Net operating loss increased to $2.0 million in Q1 2026 from $0.6 million a year earlier. Management attributes this mainly to a $1.4 million rise in operating expenses from lease-up properties, along with higher depreciation and amortization expenses on the growing portfolio.

How did gains on asset sales affect Transcontinental Realty Investors (TCI) Q1 2026 results?

Gain on sale or write down of assets, net, was $0.4 million in Q1 2026 versus $3.9 million in Q1 2025. The prior-year period benefited from a condemnation-related transaction at Windmill Farms, so lower gains this year significantly reduced overall net income despite steady rental revenues.

What real estate sales did Transcontinental Realty Investors (TCI) complete in Q1 2026?

During Q1 2026, Transcontinental Realty Investors sold 21 lots from its Windmill Farms holdings for $1.0 million. This transaction generated a $0.8 million gain on sale, contributing to reported gains on sale or write down of assets for the quarter.

Filing Exhibits & Attachments

4 documents

Press Releases

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