TRANSCONTINENTAL REALTY INVESTORS INC
For the period ended Sep 30, 2025. Filed Nov 6, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 6, 2025
TCI$49.83-0.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-07.
0000733590-25-000017
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0000733590-25-000029
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 79 previous paragraphs and 85 current paragraphs.
59 unchanged; 17 reworded; 7 added; 3 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 4 previous and 4 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (7)
Current report
•On October 10, 2025, we sold Villas at Bon Secour, a 200 unit multifamily property in Gulf Shores, Alabama, for$28.0 million (See "Financing Activities").
Current report
•On October 10, 2025, we paid off the$18.8 million loan on Villas at Bon Secour in connection with the sale of the underlying property (See "Acquisitions and Dispositions").
Current report
•The $0.2 million decrease in multifamily NOI is due to a $0.4 million decrease from the Development Properties offset in part by a$0.2 million increase from the Same Properties.
Current report
Comparison of the nine months ended September 30, 2025 to the nine months ended September 30, 2024:
Current report
•Our multifamily segment had a $0.4 million increase in NOI from Same Properties that was offset by a $0.4 million decrease from our Development Properties.
Current report
•The gain on sale or write down of assets is primarily due from dispositions at Windmill Farms (See "Acquisitions and Dispositions" in Management's Overview)
Current report
•The $3.3 million decrease in our interest income, net is due to a $3.9 million decrease in interest income offset in part by a $0.6 million decrease in interest expense. The decrease in interest income was primarily due to a decrease in funds available for investments and a decline in interest rates. Our decrease in interest expense is primarily due to the pay off of the loan on 770 South Post Oak in 2025 and refinancing Forest Grove in 2024.
Removed paragraphs (3)
Previous report
•The $1.1 million decrease in interest income, net is due to a $1.2 million decrease in interest income, which was primarily due to a decrease in the average balance of our short term investments and interest rates.
Previous report
Comparison of the six months ended June 30, 2025 to the six months ended June 30, 2024:
Previous report
•The increase in profit from the multifamily segment is primarily due to a decrease in the cost of insurance and the increase in profit from the commercial segment is primarily due to an increase in rent and a decrease in the cost of insurance and property taxes.
Reworded paragraphs (17)
Previous wording
•During thesix months ended June 30, 2025, we sold 30 lots from our holdings in Windmill Farms for $1.4 million, resulting in a gain on sale of $1.1 million.
Current wording
•During the nine months ended September 30, 2025, we sold 51 lots from our holdings in Windmill Farms for $2.3 million, resulting in a gain on sale of $1.8 million.
Previous wording
Windmill Farms is a collection of freshwater districts ("Districts") in Kaufman County Texas that is being developed into single family lots, multifamily properties and retail properties. In connection with the project, we develop the infrastructure in Windmill Farms in order for the land to appreciate and to sell land units (“lots”) to home builders for construction of single family homes. We receive reimbursement of the infrastructure costs ("District Receivables") through the issuance of municipal bonds by the Districts. As of June 30, 2025, we have $55.5 million in District Receivables.
Current wording
Windmill Farms is a collection of freshwater districts ("Districts") in Kaufman County Texas that is being developed into single family lots, multifamily properties and retail properties. In connection with the project, we develop the infrastructure (i.e. roads and utilities) in Windmill Farms in order for the land to appreciate and to sell land units (“lots”) to home builders for construction of single family homes. We receive reimbursement of the infrastructure costs ("District Receivables") through the issuance of municipal bonds by the Districts. As of September 30, 2025, we have $55.7 million in District Receivables.
Previous wording
During the six months ended June 30, 2025, we incurred $52.0 million in development costs, which were funded in part by $43.0 million in borrowing from our construction loans.
Current wording
During the nine months ended September 30, 2025, we incurred $59.2 million in development costs, which were funded in part by $54.9 million in borrowing from our construction loans. All four of these development projects are garden style apartments, which allows for construction to be completed in phases. During thethree months ended September 30, 2025, we received our initial tranche of completed units from Alera, Bandera Ridge and Merano, which allows us to start the lease-up process.
Previous wording
As provided in amendment number 31 to the Schedule 13D we filed with the SEC subsequent to the completion of the Tender Offer, if the appropriate opportunity exists at attractive prices, we may acquire additional shares of IOR. During thesix months ended June 30, 2025, we purchased an additional 32,161 common share of IOR in the market for a total cost of$0.6 million.
Current wording
As provided in amendment number 31 to the Schedule 13D we filed with the SEC subsequent to the completion of the Tender Offer, if the appropriate opportunity exists at attractive prices, we may acquire additional shares of IOR. During thenine months ended September 30, 2025, we purchased an additional 32,845 common share of IOR in the market for a total cost of$0.6 million.
Previous wording
Many of the variations in the results of operations, discussed below, occurred because of the transactions affecting our properties described above, including those related to the Redevelopment Property, the Acquisition Properties and the Disposition Properties (each as defined below).
Current wording
Many of the variations in the results of operations, discussed below, occurred because of the transactions affecting our properties described above, including those related to the Development Properties, the Acquisition Properties and the Disposition Properties (each as defined below).
Previous wording
For purposes of the discussion below, we define "Same Properties" as all of our properties with the exception of those properties that have been recently constructed or leased-up (“Redevelopment Property”), properties that have recently been acquired ("Acquisition Properties") and properties that have been disposed ("Disposition Properties"). A developed property is considered leased-up, when it achieves occupancy of 80% or more. We move a property in and out of Same Properties based on whether the property is substantially leased-up and in operation for the entirety of both periods of the comparison. There were no Acquisition Properties, Development Activities or Disposition Properties for the comparison of the three and six months ended June 30, 2025 to the three and six months ended June 30, 2024.
Current wording
For purposes of the discussion below, we define "Same Properties" as all of our properties with the exception of those properties that have been recently constructed or leased-up (“Development Properties”), properties that have recently been acquired ("Acquisition Properties") and properties that have been disposed ("Disposition Properties"). A developed property is considered leased-up, when it achieves occupancy of 80% or more. We move a property in and out of Same Properties based on whether the property is substantially leased-up and in operation for the entirety of both periods of the comparison. The Development Activities for thecomparison of the three and nine months ended September 30, 2025 to the three and nine months ended September 30, 2024 were Alera, Bandera Ridge and Merano(See "Development Activities" in Management's Overview). There were no Acquisition Properties or Disposition Properties for the comparison of the three and nine months ended September 30, 2025 to the three and nine months ended September 30, 2024.
Previous wording
The following table (dollars in thousands) summarizes our results of operations for the three and six months ended June 30, 2025 and 2024:
Current wording
The following table (dollars in thousands) summarizes our results of operations for the three and nine months ended September 30, 2025 and 2024:
Previous wording
Our $1.4 million decrease in net income is primarily attributed to the following:
Current wording
Our $1.0 million decrease in net income is primarily attributed to the following:
Previous wording
•The decrease in profit from the multifamily segment is primarily due to a decrease in rent of $0.2 million and the increase in profit from the commercial segment is due to an increase in occupancy at Stanford Center.
Current wording
•The $0.9 million increase in NOI from our commercial segment is primarily due to an increase in occupancy at Stanford Center.
Previous wording
•The increase in gain on sale of assets is primarily due to the $3.1 million condemnation settlement and the sale of land in 2025 (See "Acquisitions and Dispositions" in Management's Overview).
Current wording
•The gain on sale or write down of assets is primarily due to dispositions at Windmill Farms (See "Acquisitions and Dispositions" in Management's Overview)
Previous wording
•The $2.5 million decrease in interest income, net is due to a $2.7 million decrease in interest income offset in part by a $0.1 million decrease in interest expense. The decrease in interest income is primarily due to a decrease in the average balance of our short term investments and interest rates.
Current wording
•The $0.7 million decrease in our interest income, net is due to a $1.2 million decrease in interest income offset in part by a $0.4 million decrease in interest expense. The decrease in interest income was primarily due to a decrease in funds available for investments and a decline in interest rates. Our decrease in interest expense is primarily due to the pay off of the loan on 770 South Post Oak in 2025 and refinancing Forest Grove in 2024.
Previous wording
•The increase in other expense is primarily due to a $1.4 million increase in income tax provision as a result of the sale of the VAA Portfolio in 2022.
Current wording
•The increase in other expense is primarily due to an increase in income tax provision as a result of the sale of the VAA Portfolio in 2022.
Previous wording
Our $0.7 million increase in net income is primarily attributed to the following:
Current wording
Our $0.4 million decrease in net income is primarily attributed to the following:
Previous wording
The $13.7 million increase in cash used in operating activities is primarily due to a $6.1 million increase in other assets and a $2.1 million decrease in accounts payable and other liabilities.
Current wording
The $19.2 million increase in cash used in operating activities is primarily due to a $6.7 million increase in other assets, a $5.3 million decrease in accounts payable and other liabilities, a decrease in interest income and an increase in our tax provision.
Previous wording
The $22.4 million increase in cash used in investing activities is primarily due to the $38.4 million increase in development and renovation of real estate offset in part by the $12.7 million increase in net redemption of short-term investments. The increase in development and renovation of real estate relates to the construction of Alera, Bandera Ridge and Merano. The increase in net redemption of short-term investments was to provide additional funds for the development and renovation of real estate and the repayment of the mortgage on 770 South Post Oak in 2025.
Current wording
The $22.1 million increase in cash used in investing activities is primarily due to the $37.2 million increase in development and renovation of real estate offset in part by the $10.6 million increase in net redemption of short-term investments and a $5.8 million increase in proceeds from the real estate transactions. The increase in development and renovation of real estate relates to the construction of development projects (See "Development Activities" in Management's Overview). The increase in net redemption of short-term investments was to provide additional funds for the development and renovation of real estate and the repayment of the mortgage on 770 South Post Oak in 2025.
Previous wording
The $31.8 million increase in cash provided by financing activities was due to the $43.0 million increase in borrowings on our construction loans in connection with the development of Alera, Bandera Ridge and Merano offset in part by the $10.8 million repayment of the mortgage on 770 South Post Oak in 2025.
Current wording
The $40.5 million increase in cash provided by financing activities was due to the $44.2 million increase in borrowings on our construction loans in connection with our development projects (See "Development Activities" in Management's Overview) offset in part by a $3.7 million increase inpayments of mortgages and other notes payable (See "Financing Activities" in Management's Overview).
Previous wording
The following table reconciles net income attributable to the Company to FFO and FFO adjusted for the three and six months ended June 30, 2025 and 2024 (dollars and shares in thousands):
Current wording
The following table reconciles net income attributable to the Company to FFO and FFO adjusted for the three and nine months ended September 30, 2025 and 2024 (dollars and shares in thousands):
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
•The $1.4 million increase in NOI from our commercial segment is primarily due to an increase in occupancy at Stanford Center.
Current report — wording carried from elsewhere
•The increase in other expense is primarily due to an increase in income tax provision as a result of the sale of the VAA Portfolio in 2022.