Exhibit 10.17

THIRD AMENDMENT TO PROMISSORY NOTE

This THIRD AMENDMENT TO PROMISSORY NOTE (this “Amendment”) is made and entered
into to be effective as of June 23, 2004 (the “Effective Date”), by and among
STRATUS PROPERTIES INC., a Delaware corporation, STRATUS PROPERTIES OPERATING
CO., L.P., a Delaware limited partnership, CIRCLE C LAND, L.P., a Texas limited
partnership, f/k/a Circle C Land Corp., and AUSTIN 290 PROPERTIES, INC., a Texas
corporation (herein individually and collectively referred to as the
“Borrower”), and COMERICA BANK, a Michigan banking corporation, successor by
merger to Comerica Bank-Texas (herein referred to as the “Lender”).

W I T N E S S E T H:

WHEREAS, Borrower, as Maker, executed that certain Promissory Note dated
December 16, 1999, in the original principal amount of $20,000,000.00 U.S., in
favor of and payable to the order of Lender, as Payee, which Promissory Note
evidences a loan (the “Loan”) made by Lender to Borrower in connection with and
pursuant to that certain Loan Agreement dated December 16, 1999, executed by and
among, Borrower and Lender, as amended by (i) that certain Amendment to Loan
Agreement dated December 27, 2000, by and between Borrower and Lender (the
"First Loan Modification"), (ii) that certain Second Amendment to Loan Agreement
dated December 18, 2001 (the "Second Loan Modification") executed by and between
Borrower and Lender, (iii) that certain Third Modification and Extension
Agreement dated effective June 30, 2003 (the "Third Extension") executed by and
between Borrower and Lender and (iv) that certain Third Amendment to Loan
Agreement dated of even date with this Amendment (the "Third Loan
Modification"), executed by and between Borrower and Lender, (said loan
agreement, as amended by the First Loan Modification, Second Loan Modification,
Third Extension and Third Loan Modification, is herein called the “Loan
Agreement”); and

WHEREAS, Borrower and Lender entered into (i) that certain Amendment to
Promissory Note (the “First Note Amendment”) dated effective as of December 27,
2000, which, among other things, amended the face amount of the Promissory Note
to $10,000,000.00 and added a revolving feature pursuant to the satisfaction of
certain terms and conditions and extended the maturity date to December 16,
2002, (ii) that certain Second Amendment to Promissory Note (the “Second Note
Amendment”) dated effective as of December 18, 2001, which, among other things,
amended the face amount of the Promissory Note to $5,000,000.00 and extended the
maturity date to April 16, 2004 and (iii) the Third Extension, which, among
other things, extended the maturity date to November 30, 2005; and

WHEREAS, Borrower and Lender desire to enter into this Amendment in order to
further modify and amend certain terms and provisions of the Promissory Note
(said note, as amended by the First Note Amendment, Second Note Amendment, Third
Extension and this Amendment, is herein called the “Note”); and

WHEREAS, the Note is secured by, among other things and without limitation, the
deeds of trust, assignments and other items referenced in Section 5.1 of the
Note and in that certain Third Modification Agreement dated of even date with
this Amendment executed by and between Borrower and Lender, subject to recorded
partial releases of lien previously executed by Lender (collectively, the “Lien
Instruments”); and

WHEREAS, Borrower hereby acknowledges that (i) Borrower is obligated to Lender
under the Note, the Lien Instruments and the other Loan Documents (as such term
is defined in Section 5.1 of the Note), (ii) Borrower has no defense, offset or
counterclaim with respect to the sums owed to Lender under the Note, the Lien
Instruments and the other Loan Documents, or with respect to any covenant in the
Note, the Loan Agreement, the Lien Instruments, this Amendment or any of the
other Loan Documents, and (iii) Lender, on and as of the date hereof, has fully
performed all obligations to Borrower which Lender may have had or has on and as
of the date hereof; and

NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Borrower and Lender hereby agree as follows:

1.

Recitals.  The recitals set forth above are true, accurate and correct, and are
incorporated herein by this reference.

2.

Capitalized Terms.  Any capitalized terms not defined herein shall have the
meaning ascribed to them in the Loan Agreement.

3.

Outstanding Principal Balance of the Note.  Borrower and Lender hereby
acknowledge that the outstanding principal balance of the Note as of the
Effective Date is $2,072,969.00.

4.

Restatement, Modification and Extension of Note.  Borrower and Lender hereby
agree to restate, modify and extend the Note as follows:

4.1

Revolving Nature of the Note.  The Note continues as a revolving promissory
note, such that, prior to the Maturity Date, a portion of the principal balance
of the Note which has been repaid may be reborrowed; provided, however, that the
following conditions are satisfied: (i) no default or event of default exists
and is continuing under the Note or any of the other Loan Documents; (ii) the
outstanding principal balance of the Note does not at any time (and shall at no
time) exceed the sum of $5,000,000.00; and (iii) all additional terms and
conditions set forth in the Loan Agreement with respect to Advances under the
Note shall have been satisfied.

4.2

Deletion of Discretionary Advance Provision.  Section 3.3 of the the Second
Amendment is hereby be deleted, and any and all Advances under the Note shall be
subject to the terms and conditions set forth in the Loan Agreement with respect
to Advances under the Note.

4.3

Restatement of Sections II through IV of the Note.  The following Articles II
through IV shall replace in their entirety Articles II through IV of the Note,
which shall be deleted and of no further force and effect.

“II.

Definitions.

“Applicable Margin” means one-half percent (0.5%) for the Base Rate Balance and
two and one-half percent (2.5%) for each LIBOR Balance.

“Applicable Rate” means (a) with respect to the Base Rate Balance outstanding
from time to time, a fluctuating per annum rate of interest equal to the Base
Rate plus the Applicable Margin and (b) with respect to each LIBOR Balance, a
per annum rate of interest equal to the LIBOR Rate for the LIBOR Interest Period
then in effect with respect to such LIBOR Balance plus the Applicable Margin,
but in no event more than the Maximum Lawful Rate; provided, however, in no
event will the Applicable Rate ever be less than five percent (5.0%) per annum.

“Base Rate” means that annual rate of interest which is equal to the greater of
the annual rate of interest designated by Payee as its base or prime rate which
is charged by Payee from time to time or a variable per annum rate of interest
determined from day to day which equals the sum of 1% plus the average per annum
rate of interest on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers (“Overnight
Transactions”) transacted on the immediately preceding Business Day, as
published by the Federal Reserve Bank of New York, or, if such interest rate is
not so published for any Business Day, the average of the per annum interest
rate quotations for Overnight Transactions received by Payee (or, at its option,
the Reference Payee) for such Business Day from three Federal funds brokers of
recognized standing selected by Payee (or, at its option, the Reference Payee).
Payee's Base Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged by Payee to any of its customers.  Payee
may make commercial loans at rates of interest at, above or below its Base Rate.

“Base Rate Balance” means each portion of the unpaid principal balance of this
Note designated by Maker to bear interest at a rate determined with respect to
the Base Rate.

“Business Day” means any day other than a Saturday, Sunday or holiday, on which
Payee and the Reference Payee are open to carry on all or substantially all of
their normal commercial lending business.

“Charges” means all fees and charges and/or any other things of value, if any,
contracted for, charged, received, taken or reserved by Payee in connection with
the transactions relating to this Note and the Indebtedness, which are treated
as interest under applicable law.

“Debtor Relief Laws” means Title 11 of the United States Code, as now or
hereafter in effect, or any other applicable law, domestic or foreign, as now or
hereafter in effect, relating to bankruptcy, insolvency, liquidation,
receivership, reorganization, arrangement or composition, extension or
adjustment of debts, or similar laws affecting the rights of creditors.

“Default Rate” means at any time of determination thereof with respect to the
applicable portion of the Indebtedness evidenced by this Note, a per annum rate
of interest equal to the sum of the Applicable Rate then in effect plus six
percent (6.0%), but not more than the Maximum Lawful Rate.

“Event of Default” has the meaning given to the term in the Loan Agreement,
which definition is hereby incorporated into this Note for all purposes by this
reference.

“Indebtedness” means (i) the principal of, interest on, or other sums evidenced
by this Note or the Loan Documents; (ii) any other amounts, payments, or
premiums payable under the Loan Documents; (iii) such additional or future sums
(whether or not obligatory), with interest thereon, as may hereafter be borrowed
or advanced from Payee, its successors or assigns, by the then record owner of
the Mortgaged Property, when evidenced by a promissory note which, by its terms,
is secured thereby (it being contemplated by Maker and Payee that such future
indebtedness may be incurred); and (iv) any and all other indebtedness,
obligations, and liabilities of any kind or character of Maker to Payee, now or
hereafter existing, absolute or contingent, due or not due, arising by operation
of law or otherwise, or direct or indirect, primary or secondary, joint,
several, joint and several, fixed or contingent, secured or unsecured by
additional or different security or securities, voluntarily or involuntarily
incurred, known or unknown, or originally payable to Payee or to a third party
and subsequently acquired by Payee, including, without limitation, (A) late
charges, loan fees or charges, and overdraft indebtedness, (B) costs incurred by
Payee in establishing, determining, continuing or defending the validity or
priority of any Lien or in pursuing any of its rights or remedies under any Loan
Document or in connection with any proceeding involving Payee as a result of any
financial accommodation to Maker, (C) debts, obligations and liabilities for
which Maker would otherwise be liable to Payee were it not for the invalidity or
unenforceability of them by reason of any Debtor Relief Law or for any other
reason, and (D) reasonable costs and expenses of attorneys and paralegals,
whether any suit or other action is instituted, and court costs if suit or
action is instituted (whether any such fees, costs or expenses are incurred at
the trial court level or on appeal, in any Debtor Relief Law proceeding, in
administrative proceedings, in probate proceedings or otherwise); (v) any of the
foregoing indebtedness, obligations, and liabilities to Payee of Maker as a
member of any partnership, joint venture, trust or other type of business
association, or other group, and whether incurred by Maker as principal, surety,
endorser, guarantor, accommodation party or otherwise; and (vi) any and all
renewals, modifications, amendments, restatements, rearrangements,
consolidations, substitutions, replacements, enlargements, and extensions of any
of the foregoing, it being contemplated by Maker and Payee that Maker may
hereafter become indebted to Payee in further sum or sums.  Notwithstanding the
foregoing provisions of this definition, the Loan Documents shall not secure any
such other Indebtedness with respect to which Payee is by applicable law
prohibited from obtaining a lien on real estate.  Further, the term
“Indebtedness” shall not operate or be effective to constitute or require any
assumption or payment by any Person, in any way, of any debt or obligation of
any other Person to the extent that the same would violate or exceed the limit
provided in any applicable usury or other law or include any consumer loan to
the extent treatment of such loan or extension of credit as part of the
Indebtedness would violate any Governmental Requirement.

“Interest Notice” means a written notice from Maker in form and content
satisfactory to Payee specifying the Interest Option(s) and the respective
amounts of the Base Rate Balance and each LIBOR Balance designated by Maker for
such advance.

“Interest Option” means Maker's right, exercisable from time to time, to
designate a portion of the outstanding principal balance of this Note as a “Base
Rate Balance” and to designate one or more portions of the unpaid principal
balance of this Note as a “LIBOR Balance.”

“LIBOR Balance” means each portion of the unpaid principal balance of this Note
designated by Maker to bear interest at a rate determined with respect to a
LIBOR Rate.

“LIBOR Business Day” as used herein, shall mean a Business Day on which dealings
in U.S. dollars are carried out in the London interbank market of United States
Dollar deposits selected by Payee or Reference Payee (or, if applicable, the
Reference Payee's designated LIBOR lending office).

“LIBOR Interest Period” means, with respect to the applicable LIBOR Balance, a
period commencing on the date (which must be a LIBOR Business Day) upon which,
pursuant to an Interest Notice, the principal amount of such LIBOR Balance
begins to accrue interest at the applicable LIBOR Rate plus the Applicable
Margin (or, in the case of a rollover to a successive LIBOR Interest Period, the
last day of the immediately preceding LIBOR Interest Period) and ending 30, 60,
90, 120, 180 or 360 days after the commencement date (as designated in the
Interest Notice); provided, that: (i) any LIBOR Interest Period which would
otherwise end on a day which is not a LIBOR Business Day shall be extended to
the next succeeding LIBOR Business Day (unless such LIBOR Business Day falls in
another calendar month, in which case, such LIBOR Interest Period shall end on
the next preceding LIBOR Business Day); and (ii) any LIBOR Interest Period which
begins on a day for which there is no numerically corresponding day in the
calendar month at the end of such LIBOR Interest Period shall end on the last
LIBOR Business Day of such last calendar month; and (iii) no LIBOR Interest
Period shall extend beyond the Maturity Date.

“LIBOR Rate” means, with respect to the applicable LIBOR Interest Period and
applicable LIBOR Balance, the quotient of the following (rounded upwards, if
necessary, to the nearest 1/16 of 1%): (a) the interest rate determined by Payee
or Reference Payee (which determination shall be conclusive) to be the per annum
interest rate at which deposits in immediately available funds in U.S. dollars
are offered to prime banks in the London interbank market of United States
Dollar deposits selected by Payee or Reference Payee (or, if applicable, by the
Reference Payee's designated LIBOR lending office) for delivery on the first day
of such LIBOR Interest Period for a period equal to the length of such LIBOR
Interest Period, divided by (b) a percentage (expressed as a decimal) equal to
1.00 minus the maximum rate during such interest period at which Payee or the
Reference Payee (or, if applicable, the Reference Payee's designated LIBOR
lending office) is required to maintain reserves on “Eurocurrency Liabilities”
as defined in and pursuant to Regulation D of the Board of Governors of the
Federal Reserve System or, if such regulation or designation is modified, and as
long as Payee or the Reference Payee (or, if applicable, the Reference Payee's
designated LIBOR lending office) is required to maintain reserves against a
category of liabilities which includes LIBOR deposits or includes a category of
assets which includes LIBOR loans, the rate at which such reserves are required
to be maintained on such category.

“Loan Agreement” means that certain Loan Agreement between Maker and Payee
originally dated December 16, 1999, as amended by (i) that certain Amendment to
Loan Agreement dated December 27, 2000, by and between Maker and Payee, (ii)
that certain Second Amendment to Loan Agreement dated December 18, 2001 executed
by and between Maker and Payee, (iii) that certain Third Modification and
Extension Agreement dated effective June 30, 2003 executed by and between Maker
and Payee and (iv) that certain Third Amendment to Loan Agreement dated as of
June 23, 2004 executed by and between Maker and Payee, and as may be further
amended from time to time.

“Maturity Date” means May 30, 2006, subject, however, in all events to the right
of acceleration prior to the Maturity Date as provided for in this Note and the
other Loan Documents.

“Maximum Lawful Rate” shall mean the maximum lawful rate of interest which may
be contracted for, charged, taken, received or reserved by Payee in accordance
with the applicable laws of the State of Texas (or applicable United States
federal law to the extent that it permits Payee to contract for, charge, take,
receive or reserve a greater amount of interest than under Texas law), taking
into account all Charges made in connection with the loan evidenced by this Note
and the Loan Documents.  To the extent that Payee is relying on Chapter 303 of
the Texas Finance Code to determine the Maximum Lawful Rate payable on the
Indebtedness, Payee will utilize the weekly ceiling from time to time in effect
as provided in such Chapter 303, as amended.  To the extent United States
federal law permits Payee to contract for, charge, take, receive or reserve a
greater amount of interest than under Texas law, Payee will rely on United
States federal law instead of such Chapter 303 for the purpose of determining
the Maximum Lawful Rate.  Additionally, to the extent permitted by applicable
law now or hereafter in effect, Payee may, at its option and from time to time,
utilize any other method of establishing the Maximum Lawful Rate under such
Chapter 303 or under other applicable law by giving notice, if required, to
Maker as provided by applicable law now or hereafter in effect.

“Reference Payee” means Comerica Bank, a Michigan banking corporation, its
successors and assigns.

“$25,000,000.00 Revolving Credit Note” means that Promissory Note originally
dated December 16, 1999 in the original principal amount of $10,000,000.00,
executed by Maker for the benefit of Payee, as amended by (i) that certain
Amendment to Revolving Credit Note dated effective as of December 27, 2000,
whereby, among other things, the face amount was increased to $20,000,000.00,
(ii) that certain Second Amendment to Revolving Credit Note dated effective
December 18, 2001, whereby the face amount was increased to $25,000,000.00,
(iii) that certain Third Modification and Extension Agreement dated effective
June 30, 2003, executed by and between Maker and Payee and (iv) that certain
Third Amendment to Revolving Credit Note dated as of June 23, 2004, executed by
and between Maker and Payee, which $25,000,000.00 Revolving Credit Note is
cross-defaulted and cross-collateralized with this Note.

III.

INTEREST RATE COMPUTATION.

3.1.

Interest Rate.  Except as otherwise provided herein, interest on the principal
balance of this Note outstanding from time to time shall accrue at a per annum
rate equal to the lesser of (a) the Applicable Rate or (b) the Maximum Lawful
Rate until maturity, whether by acceleration or otherwise, or until an Event of
Default occurs and after that at the Default Rate (but in no event in excess of
the Maximum Lawful Rate).

3.2.

Default Rate.  Upon the occurrence of an Event of Default hereunder or under any
of the Loan Documents, at the option of the Payee, the principal balance of this
Note then outstanding shall bear interest at the Default Rate for the period
beginning with the date of occurrence of such Event of Default.

3.3.

Interest Limitation Recoupment.  Notwithstanding anything in this Note to the
contrary, if at any time (i) interest at the Applicable Rate, (ii) interest at
the Default Rate, if applicable, and (iii) the Charges computed over the full
term of this Note, exceed the Maximum Lawful Rate, then the rate of interest
payable hereunder, together with all Charges, shall be limited to the Maximum
Lawful Rate; provided, however, that any subsequent reduction in any applicable
reference rate shall not cause a reduction of the rate of interest payable
hereunder below the Maximum Lawful Rate until the total amount of interest
earned hereunder, together with all Charges, equals the total amount of interest
which would have accrued at the Applicable Rate if such interest rate had at all
times been in effect.

3.4.

 Computation Period.  Except for the computation of the Maximum Lawful Rate
which shall be undertaken on the basis of a 365- or 366-day year, as the case
may be, interest on the indebtedness evidenced by this Note shall be computed on
the basis of a 360-day year and shall accrue on the actual number of days any
principal balance hereof is outstanding.

3.5.

Interest Rate Changes.  Interest rate changes will be effective for interest
computation purposes as and when the Maximum Lawful Rate or the Applicable Rate,
as applicable, changes.

3.6.

LIBOR Rate Provisions.

(a)

The Interest Option shall be exercisable by Maker subject to the other
limitations in this Note on Maker's option to designate a portion of the unpaid
principal balance hereof as a LIBOR Balance and only in the manner provided
below:

(i)

Before 12:00 noon at least three (3) Business Days prior to the date Maker has
requested Payee to make the initial advance upon this Note, Maker shall have
given Payee an Interest Notice with respect to such advance.  If the required
Interest Notice shall not have been timely received by Payee or fails to
designate all or any portion of the unpaid principal amount hereof of the
advance as either a Base Rate Balance or a LIBOR Balance in accordance with the
terms and provisions of this Note, Maker shall be deemed conclusively to have
designated such amounts to be a Base Rate Balance and to have given Payee notice
of such designation.

(ii)

At least three (3) LIBOR Business Days prior to the termination of any LIBOR
Interest Period for a LIBOR Balance, Maker shall give Payee an Interest Notice
specifying the Interest Option which is to be applicable to such LIBOR Balance
upon the expiration of such LIBOR Interest Period.  If the required Interest
Notice shall not have been timely received by Payee, Maker shall be deemed
conclusively to have designated such amount as a Base Rate Balance immediately
upon the expiration of such LIBOR Interest Period and to have given Payee notice
of such designation.

(iii)

Maker shall have the right, exercisable on any Business Day subject to the terms
of this Note, to convert an eligible portion of the Base Rate Balance to a LIBOR
Balance by giving Payee an Interest Notice of such designation at least three
(3) LIBOR Business Days prior to the effective date of such exercise.
 Additionally, upon termination of any LIBOR Interest Period, Maker shall have
the right, on any Business Day, to convert all or a portion of such principal
amount from the LIBOR Balance to a Base Rate Balance by giving Bank an Interest
Notice of such selection at least three (3) LIBOR Business Days prior to
effective date of such exercise.

(iv)

There may be no more than five (5) LIBOR Balances in effect at any time.

(v)

Each LIBOR Balance must be, as of the first day of the applicable LIBOR Interest
Period, at least $250,000.00.

(vi)

No Event of Default, or condition or event which, with the giving of notice or
the lapse of time, or both, would constitute an Event of Default, shall have
occurred and be continuing or exist.

(vii)

Each exercise of an Interest Option to designate a LIBOR Balance to bear
interest at an Applicable Rate which is based on the LIBOR Rate shall not be
revocable.

(b)

Changes in the Applicable Rate applicable to a Base Rate Balance or a LIBOR
Balance shall become effective without prior notice to Maker automatically as of
the opening of business on the date of each change in the Base Rate or the LIBOR
Rate, as the case may be.

(c)

If Payee or Reference Bank (or, if applicable, the Reference Bank's designated
LIBOR lending office) determines that deposits in U.S. dollars (in the
applicable amounts) are not being offered to prime banks in the interbank LIBOR
market selected by Payee or Reference Bank (or if applicable, the Reference
Bank's designated LIBOR lending office) for the applicable LIBOR Interest
Period, or that the rate at which such dollar deposits are being offered will
not adequately and fairly reflect the cost to Payee or Reference Bank (or, if
applicable, the Reference Bank's designated LIBOR lending office) of making or
maintaining a LIBOR Balance for the applicable LIBOR Interest Period, Payee
shall forthwith give notice thereof to Maker, whereupon, until Payee notifies
Maker that such circumstances no longer exist, the right of Maker to select an
Interest Option based upon a LIBOR Rate shall be suspended, and Maker may only
select Interest Options based on the Base Rate.

(d)

If the adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by Payee or Reference
Bank (or, if applicable, its designated LIBOR lending office) with any request
or directive (whether or not having the force of law) of any such authority,
central bank or comparable agency shall make it unlawful or impractical for
Payee or the Reference Bank (or, if applicable, its designated LIBOR lending
office) to make or maintain a LIBOR Balance, Payee shall so notify Maker and any
then-existing LIBOR Balance shall automatically convert to a Base Rate Balance
either (i) on the last day of the then-current LIBOR Interest Period applicable
to such LIBOR Balance, if Payee and Reference Bank (and, if applicable, its
designated LIBOR lending office) may lawfully continue to maintain and fund such
LIBOR Balance to such day, or (ii) immediately, if Payee or Reference Bank (or,
if applicable, its designated LIBOR lending office) may not lawfully continue to
maintain such LIBOR Balance to such day.  Further, until Payee notices Maker
that such conditions or circumstances no longer exist, the right of Maker to
select an Interest Option based on a LIBOR Rate shall be suspended, and Maker
may only select Interest Options based on the Base Rate.

(e)

If either (i) the adoption of any applicable law, rule or regulation, or any
change therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by Payee or Reference
Bank (or, if applicable, its designated LIBOR lending office) with any request
or directive (whether or not having the force of law) of any such authority,
central bank or comparable agency shall subject Payee or Reference Bank (or, if
applicable, its designated LIBOR lending office) to any tax (including without
limitation any United States interest equalization or similar tax, however
named), duty or other charge with respect to any LIBOR Balance, this Note or
Payee's or Reference Bank's (or, if applicable, its designated LIBOR lending
office's) obligation to compute interest on the principal balance of this Note
at a rate based upon a LIBOR Rate, or shall change the basis of taxation of
payments to Payee or Reference Bank (or, if applicable, its designated LIBOR
lending office) of the principal of or interest on any LIBOR Balance or any
other amounts due under this Note in respect of any LIBOR Balance or Payee's or
the Reference Bank's (or, if applicable, its designated LIBOR lending office's)
obligation to compute the interest on the balance of this Note at a rate based
upon a LIBOR Rate, or (ii) any governmental authority, central bank or other
comparable authority shall at any time impose, modify or deem applicable any
reserve (including, without limitation, any imposed by the Board of Governors of
the Federal Reserve System), special deposit or similar requirement against
assets of, deposits with or for the account of, or credit extended by, Payee or
Reference Bank (or, if applicable, its designated LIBOR lending office), or
shall impose on Payee or the Reference Bank (or, if applicable, its designated
LIBOR lending office) or any relevant interbank LIBOR market or exchange any
other condition affecting any LIBOR Balance, this Note or Payee's or Reference
Bank's (or, if applicable, its designated LIBOR lending office's) obligation to
compute the interest on the balance of this Note at a rate based upon a LIBOR
Rate; and the result of any of the foregoing is to increase the cost to Payee or
Reference Bank (or, if applicable, the Reference Bank's designated LIBOR lending
office) of maintaining any LIBOR Balance (not already included in the
calculation of LIBOR Rate as defined above), or to reduce the amount of any sum
received or receivable by Payee or Reference Bank (or, if applicable, the
Reference Bank's designated LIBOR lending office) under or with respect to this
Note by an amount deemed by Payee to be material, then upon demand by Payee,
Maker shall pay to Payee such additional amount or amounts as will compensate
Payee and the Reference Bank (and, if applicable, its designated LIBOR lending
office) for such increased cost or reduction.  The Bank will promptly notify
Maker of any event of which it has knowledge, occurring after the date hereof,
which will entitle Payee or Reference Bank (or, if applicable, the Reference
Bank's designated LIBOR lending office) to compensation pursuant to this
paragraph.  A certificate of Payee claiming compensation under this paragraph
and setting forth the additional amount or amounts to be paid hereunder shall be
conclusive in the absence of manifest error.

(f)

If any applicable law, treaty, rule, or regulation (whether domestic or foreign)
now or hereafter in effect and whether presently applicable to Payee or
Reference Bank (or, if applicable, the Reference Bank's designated LIBOR lending
office) or any change therein or any interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof or compliance by Payee or Reference
Bank (or, if applicable, the Reference Bank's designated LIBOR lending office)
therewith or with any guidance, request or directive of any such governmental
authority, central bank or comparable agency (whether or not having the force of
law), including any risk-based capital guidelines, affects or would affect the
amount of capital required or expected to be maintained by Payee or Reference
Bank (or any corporation controlling Payee or Reference Bank), (beyond any
already included in the calculation of LIBOR Rate as defined above), and Payee
determines that the amount of such capital is increased by or based upon the
existence of any obligations of Payee hereunder or the maintaining of any LIBOR
Balance hereunder, and such increase has the effect of reducing the rate of
return on Payee's or Reference Bank's (or its controlling corporation's) capital
as a consequence of such obligations or the maintaining of LIBOR Balances
hereunder to a level below that which Payee or Reference Bank (or such
controlling corporation) could have achieved but for such circumstances (taking
into consideration its policies with respect to capital adequacy), then Maker
shall pay to Payee, within fifteen (15) days of receipt by Maker of written
notice from Payee demanding such compensation, such additional amounts as are
sufficient to compensate Payee or Reference Bank (or its controlling
corporation) for any increase in the amount of capital and reduced rate of
return which Payee determines to be allocable to the existence of any
obligations of Payee hereunder or maintenance of any LIBOR Balances hereunder.
 A certificate of Bank as to the amount of such compensation, prepared in good
faith and in reasonable detail by Payee, which is submitted by Payee to Maker
shall be conclusive and binding for all purposes absent manifest error.

(g)

Notwithstanding any other term or provisions of this Note to the contrary, Maker
may not repay any LIBOR Balance or convert all or any portion of a LIBOR Balance
to a Base Rate Balance prior to the expiration of the applicable LIBOR Interest
Period, unless (i) such repayment or conversion is specifically required by the
terms of this Note, (ii) Payee demands that such repayment or conversion be
made, (iii) Payee, in its sole discretion, consents to such repayment or
conversion, or (iv) Maker agrees to promptly pay Yield Maintenance (defined
below) upon receipt of a calculation for same from Payee.  If for any reason,
whether or not consent shall have been given or demand shall have been made by
Payee, any LIBOR Balance is repaid or converted prior to the expiration of the
corresponding LIBOR Interest Period or any Interest Option which designates a
LIBOR Balance is revoked for any reason whatsoever prior to the commencement of
the applicable LIBOR Interest Period or Maker fails for any reason to borrow the
full amount of any LIBOR Balance for which Maker has exercised an Interest
Option, or if for any other reason whatsoever, the basis for determining the
Applicable Rate shall be changed from a LIBOR Rate to the Base Rate prior to the
expiration of the applicable LIBOR Interest Period, or Maker shall fail to make
any payment of principal or interest upon this Note at any time that the
Applicable Rate is based on a LIBOR Rate, then Maker shall pay to Payee on
demand any amounts required to compensate Payee and Reference Bank (and, if
applicable, its designated LIBOR lending office) for any losses, costs or
expenses which any of them may incur as a result thereof, including, without
limitation, any loss, cost or expense incurred in obtaining, liquidating,
employing or redeploying deposits from third parties (referred to herein as
“Yield Maintenance”).  Amounts payable by Maker to Payee pursuant to this
paragraph (and sometimes referred to herein as Yield Maintenance) may include,
without limitation, amounts equal to the excess, if any of (a) the amounts of
interest which would have accrued on any amounts so prepaid, refunded, converted
or not so borrowed, from the respective dates of prepayment, refund, conversion
or failure to borrow through the last day of the relevant LIBOR Interest Periods
at the applicable rates of interest for the applicable LIBOR Balances, as
provided under this Note, over (b) the amounts of interest determined by Payee
or Reference Bank (or, if applicable, its designated LIBOR lending office) which
would have accrued to Payee or Reference Bank (or, if applicable, its designated
LIBOR lending office) on such respective amounts by placing such amounts on
deposit for comparable periods with leading banks in the interbank LIBOR market
selected by Payee or Reference Bank (or, if applicable, the Reference Bank's
designated LIBOR lending office).  The calculation of any such amounts under
this paragraph shall be made as if Payee or Reference Bank (or, if applicable,
the Reference Bank's designated LIBOR lending office) actually funded or
committed to fund the relevant LIBOR Balances hereunder through the purchase of
underlying deposits in amounts equal to the respective amounts of the applicable
LIBOR Balances and having terms comparable to the applicable LIBOR Interest
Periods; provided, however, that Payee or Reference Bank may fund LIBOR Balances
hereunder in any manner they may elect in their sole discretion, and the
foregoing assumptions shall be utilized only for the purposes of calculating
amounts payable under this paragraph.  Upon written request by Maker, Payee
shall deliver to Maker a certificate setting forth the basis for determining
such losses, costs and expenses which certificate shall be conclusive in the
absence of manifest error.

(h)

For any LIBOR Balance, if Payee or the Reference Bank shall designate a LIBOR
lending office which maintains books separate from those of Payee or the
Reference Bank, Payee and the Reference Bank shall have the option of
maintaining and carrying such LIBOR Balance on the books of such LIBOR lending
office.

IV.

PAYMENTS.

4.1.

Payment Schedule.  This Note shall be due and payable as follows:

(a)

From and after the date hereof, Maker shall pay Payee interest only payments
equal to all then accrued but unpaid interest hereon on the fifth (5th) day of
each month until the Maturity Date or upon earlier maturity hereof, whether by
acceleration or otherwise.

(b)

The entire unpaid principal balance hereof and any and all accrued but unpaid
interest thereon shall be due and payable in full on the Maturity Date or upon
earlier maturity hereof, whether by acceleration or otherwise.

4.2.

Late Charge.  In addition to the payments otherwise specified herein, subject to
the provisions of Section 5.4 (Interest Limitation) hereof, if Maker fails,
refuses or neglects to pay, in full, any installment or portion of the
indebtedness evidenced hereby within ten (10) days after the same shall be due
and payable, then Maker shall be obligated to pay to Payee a late charge equal
to five percent (5%) of the amount of such delinquent payment to-compensate
Payee for Maker's default and the additional costs and administrative efforts
required by reason of such default.

4.3.

Revolving Credit.  Except as otherwise provided herein and as otherwise limited
by the terms of the Loan Agreement, Maker may borrow, repay (provided the
outstanding principal balance is at all times a minimum of $1,000.00 or greater)
and reborrow hereunder.  The principal amount of each advance made hereunder
shall be recorded by Payee on its internal records, each such notation showing
the date and amount of each advance.  Each payment of principal or interest made
by Maker hereunder shall be recorded by Payee on its internal records, each
notation showing the date and amount of such payment of principal or interest.
 The aggregate unpaid principal and interest amounts of the advances made
hereunder set forth in Payee's internal records shall be prima facie evidence of
the principal and interest amounts owing and unpaid hereunder.  Chapter 346 of
the Texas Finance Code (and as the same may be incorporated by reference in
other Texas statutes) shall not apply to the Indebtedness evidenced by this
Note.

4.4

Application.  All payments on this Note shall be applied in accordance with the
terms of the Loan Agreement.

4.5

Place.  All payments hereunder shall be made to Payee at its offices located in
Dallas County, Texas, at the address of Payee as specified herein or as Payee
may from time to time designate in writing to Maker.

4.6

Business Days.  If any payment of principal or interest on this Note shall
become due and payable on a day that is not a Business Day, such payment shall
be made on the next succeeding Business Day of Payee.  Any such extension of
time for payment shall be included in computing interest which has accrued and
shall be payable in connection with such payment.

4.7

Legal Tender.  All amounts payable hereunder are payable in immediate lawful
money or legal tender of the United States of America without setoff or
counterclaim.

4.8

Prepayment.  Maker shall have the right to prepay without premium or penalty at
any time the entire unpaid principal balance of this Note and from time to time
any portion thereof, but must also pay the amount of then accrued but unpaid
interest on the amount of principal being so prepaid.  Any such partial
prepayments of principal shall be applied in inverse order of maturity to the
last maturing installment(s) of principal.”

5.

Borrower’s Reaffirmation.  Borrower hereby reaffirms all of its obligations
under the Note (as amended hereby), the Lien Instruments and the other Loan
Documents, and acknowledges that it has no claims, offsets or defenses with
respect to the payment of sums due under the Note (as amended hereby), the Lien
Instruments or the other Loan Documents.

6.

Continuing Effect; Ratification.  Except as expressly restated and modified by
this Amendment, the Note shall remain unchanged and in full force and effect.
 The Note, as modified by this Amendment, and all documents, assignments,
transfers, liens and security rights pertaining to it, are hereby ratified,
reaffirmed and confirmed in all respects as valid, subsisting and continuing in
full force and effect.  The Note and this Amendment shall together comprise the
Note evidencing the Loan.

7.

No Waiver.  The execution and delivery of this Amendment shall in no way be
deemed to be a waiver by Lender of any default or potential default by Borrower
under the Note or the other Loan Documents or of any rights, powers or remedies
of Lender under the Note or the other Loan Documents, and shall in no way limit,
impair or prejudice Lender from exercising any past, present or future right,
power or remedy available to it under the Note and the other Loan Documents.

8.

No Novation.  It is the intent of the parties that this Amendment shall not
constitute a novation and shall in no way limit, diminish, impair or adversely
affect the lien priority of the Lien Instruments.  All of the liens and security
interests securing the Loan, including, without limitation, the liens and
security interests created by the Lien Instruments, are hereby ratified,
reinstated, renewed, confirmed and extended to secure the Loan and the Note as
modified hereby.

9.

Binding Effect.  This Amendment shall be binding upon and shall inure to the
benefit of Borrower, Lender and any subsequent holder of the Note, and their
respective successors and assigns.

10.

Governing Law.  This Amendment shall be construed in accordance with and
governed by the laws of the State of Texas.

11.

Counterpart Execution.  This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but together shall
constitute one and the same instrument.

12.

Notice of Final Agreement.  This Agreement is the entire agreement between the
parties with respect to modifications of documents provided for herein and
supersedes all prior conflicting or inconsistent agreements, consents and
understandings relating to such subject matter.

THE NOTE, THIS AMENDMENT, THE LOAN AGREEMENT, THE LIEN INSTRUMENTS AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.

THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN PARTIES.

[SIGNATURE PAGES FOLLOW]

IN WITNESS WHEREOF, Borrower and Lender have executed this Amendment to be
effective as of the Effective Date.

BORROWER:

STRATUS PROPERTIES INC.,

a Delaware corporation

By:  \s\ William H. Armstrong, III

William H. Armstrong, III,

Chairman of the Board, President

and Chief Executive Officer

STRATUS PROPERTIES OPERATING CO., L.P., a Delaware limited partnership

By:

STRS L.L.C., a Delaware limited liability company, General Partner

By:

Stratus Properties Inc., a Delaware corporation, its Sole Member

By:  \s\ William H. Armstrong, III

William H. Armstrong, III,

Chairman of the Board,

President and Chief Executive

Officer

CIRCLE C LAND, L.P., a Texas limited partnership, f/k/a Circle C Land Corp.

By:

Circle C GP, L.L.C., a Delaware limited liability company, its general partner

By:

Stratus Properties, Inc., a Delaware corporation, its Sole Member

By:  \s\ William H. Armstrong, III

William H. Armstrong, III,

President

AUSTIN 290 PROPERTIES, INC.,

a Texas corporation

By:  \s\ William H. Armstrong, III

William H. Armstrong, III, President

LENDER:

COMERICA BANK, a Michigan banking corporation, successor by merger to Comerica
Bank- Texas

By:  \s\ Shery R. Layne

Name:  Shery R. Layne

Title:  Senior Vice President