SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549

                           FORM 10-Q

    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934

            For the Quarter Ended September 30, 2001



                Commission File Number:  0-19989



                    Stratus Properties Inc.



    Incorporated in Delaware                  72-1211572
                                  (IRS Employer Identification No.)


     98 San Jacinto Blvd., Suite 220, Austin, Texas  78701


 Registrant's telephone number, including area code: (512) 478-5788


     Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X  No _


On September 30, 2001, there were issued and outstanding
7,111,620 shares of the registrant's Common Stock, par value
$0.01 per share.


                    STRATUS PROPERTIES INC.
                       TABLE OF CONTENTS

                                                            Page

          Part I.  Financial Information

            Financial Statements:

              Condensed Balance Sheets                        3

              Statements of Income                            4

              Statements of Cash Flows                        5

              Notes to Financial Statements                   6

            Remarks                                           9

            Report of Independent Public Accountants         10

            Management's Discussion and Analysis
              of Financial Condition and Results of
              Operations                                     11

          Part II.  Other Information                        17

          Signature                                          18

          Exhibit Index                                     E-1

                     STRATUS PROPERTIES INC.
                 Part I.  FINANCIAL INFORMATION

Item 1.   Financial Statements

<TABLE>
<CAPTION>


                     STRATUS PROPERTIES INC.
              CONDENSED BALANCE SHEETS (Unaudited)


                                            September 30,   December 31
                                                2001            2000
                                            ------------    -----------
<S>                                         <C>             <C>
ASSETS
Current assets:
Cash and cash equivalents, including
restricted cash of $0.2 million and
$0.6 million, respectively                  $        579    $     7,996
Accounts receivable                                1,276            596
Prepaid expenses                                     126            218
                                            ------------    -----------
        Total current assets                       1,981          8,810
Real estate and facilities, net                  106,707         93,005
Investments in and advances to
unconsolidated affiliates                          6,882          7,596
Other assets                                       9,216          2,482
                                            ------------    -----------
Total assets                                $    124,786    $   111,893
                                            ============    ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued liabilities    $      3,147    $     1,920
Accrued interest, property taxes and other         1,470          1,486
                                            ------------    -----------
Total current liabilities                          4,617          3,406
Long-term debt                                    20,137          8,440
Other liabilities                                  5,179          8,967
Mandatorily redeemable preferred stock            10,000         10,000
Stockholders' equity                              84,853         81,080
                                            ------------    -----------
Total liabilities and stockholders' equity  $    124,786    $   111,893
                                            ============    ===========

</TABLE>

The accompanying notes are an integral part of these financial
statements.

<PAGE>                               3

                   STRATUS PROPERTIES INC.
                STATEMENTS OF INCOME (Unaudited)

<TABLE>
<CAPTION>

                                     Three Months Ended  Nine Months Ended
                                        September 30,      September 30,
                                      ----------------   -----------------
                                        2001     2000      2001      2000
                                      -------  -------   --------   -------
                                    (In Thousands, Except Per Share Amounts)
<S>                                   <C>      <C>       <C>        <C>
Revenues                              $ 4,459  $ 2,019   $ 14,098   $ 7,074
Costs and expenses:
Cost of sales                             752    1,573      7,513     4,996
General and administrative expenses       515      938      1,897     2,728
                                      -------  -------   --------   -------
   Total costs and expenses             1,267    2,511      9,410     7,724
                                      -------  -------   --------   -------
Operating income (loss)                 3,192     (492)     4,688      (650)
Interest expense, net                     -       (195)      (456)     (582)
Other income, net                           4      150        239     7,958
                                      -------  -------   --------   -------
Income before income taxes and
 equity in affiliates                   3,196     (537)     4,471     6,726
Income tax provision                       -       -          -         (40)
Equity in unconsolidated affiliates
 income (loss)                           (140)     701       (305)    1,331
                                      -------  -------   --------   -------
Net income                            $ 3,056  $   164   $  4,166   $ 8,017
                                      =======  =======   ========   =======

Net income per share:
     Basic                              $0.43    $0.02      $0.58     $1.12
                                        =====    =====      =====     =====
     Diluted                            $0.37    $0.02      $0.51     $0.99
                                        =====    =====      =====     =====

Average shares outstanding:
     Basic                              7,112    7,149      7,152     7,148
                                        =====    =====      =====     =====
     Diluted                            8,152    8,146      8,115     8,135
                                        =====    =====      =====     =====

</TABLE>

The accompanying notes are an integral part of these financial
statements.

<PAGE>                               4

<TABLE>
<CAPTION>

                     STRATUS PROPERTIES INC.
              STATEMENTS OF CASH FLOWS (Unaudited)

                                                    Nine Months Ended
                                                      September 30,
                                                    -----------------
                                                     2001      2000
                                                    -------   -------
                                                     (In Thousands)
<S>                                                 <C>       <C>
Cash flow from operating activities:
Net income                                          $ 4,166   $ 8,017
Adjustments to reconcile net income to
net cash provided by operating
activities:
 Depreciation and amortization                          100        88
 Cost of real estate sold                             5,830       667
 Recognition of deferred Circle C
  municipal utility reimbursements                      -      (7,430)
 Equity in unconsolidated affiliates' loss (income)     305    (1,331)
 Long-term receivable and other                      (8,356)    4,250
 (Increase) decrease in working capital:
  Accounts receivable and other                        (588)      778
  Accounts payable and accrued liabilities            1,408      (276)
                                                    -------   -------
Net cash provided by operating activities             2,865     4,763
                                                    -------   -------

Cash flow from investing activities:
Real estate and facilities                          (19,540)   (3,731)
Investment in Lakeway Project                        (2,000)      -
                                                    -------   -------
Net cash used in investing activities               (21,540)   (3,731)
                                                    -------   -------

Cash flow from financing activities:
Payments on term loan                                (5,588)   (4,697)
Proceeds from credit facility, net                   15,328     3,309
Proceeds from term loan                               5,000       -
Repayment of convertible debt                        (3,240)      -
Repurchases of shares of Stratus' common stock         (242)      -
Exercise of stock options                               -          18
                                                    -------   -------
Net cash provided by (used in) financing activities  11,258    (1,370)
                                                    -------   -------
Net decrease in cash and cash equivalents            (7,417)     (338)
Cash and cash equivalents at beginning of year        7,996     3,964
                                                    -------   -------
Cash and cash equivalents at end of period          $   579   $ 3,626
                                                    =======   =======

</TABLE>

The accompanying notes are an integral part of these financial
statements.

<PAGE>                            5


                     STRATUS PROPERTIES INC.
                  NOTES TO FINANCIAL STATEMENTS

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Share Purchase Program.  In February 2001, Stratus' Board of
Directors authorized an open market stock purchase program for up
to 0.7 million stock-split adjusted shares of Stratus' common
stock (see Note 6).  The purchases may occur over time depending
on many factors, including the market price of Stratus stock;
Stratus' operating results, cash flow and financial position; and
general economic and market conditions.  No purchases have been
made under this program through October 26, 2001.

Recent Accounting Pronouncements.  In June 1998, the Financial
Accounting Standards Board (FASB) issued Statement of Financial
Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" (SFAS 133).  SFAS 133, as
subsequently amended, is effective for fiscal years beginning
after June 15, 2000 and establishes accounting and reporting
standards requiring that every derivative instrument (including
certain derivative instruments embedded in other contracts) be
recorded in the balance sheet as either an asset or liability
measured at its fair value.  The accounting for changes in the
fair value of a derivative depends on the intended use of the
derivative and the resulting designation.  Stratus adopted SFAS
133 effective January 1, 2001, with its adoption having no impact
on its financial position or results of operations.  Stratus
currently has no derivative instruments, as defined in SFAS 133.

    In July 2001, the FASB issued SFAS 141, "Business
Combinations," SFAS 142, "Goodwill and other Intangible Assets".
SFAS 141 requires that all business combinations subsequent to
June 30, 2001 be accounted for under the purchase method of
accounting.  The pooling-of-interests method is no longer
allowed.  SFAS 142 requires that upon adoption, amortization of
goodwill will cease and instead, the carrying value of goodwill
will be evaluated for impairment on at least an annual basis.
SFAS 142 is effective for fiscal years beginning after December
15, 2001.  Stratus does not anticipate the adoption of these
standards to have any affect on its financial position and
results of operations.

    In August 2001, the FASB issued SFAS No. 143 "Accounting for
Asset Retirement Obligations" and SFAS No. 144, "Accounting for
the Impairment or Disposal of Long-Lived Assets."  SFAS 143,
effective for fiscal years beginning after June 15, 2002,
requires the fair value of liabilities for asset retirement
obligations to be recorded in the period they are incurred. SFAS
No. 144 establishes a single accounting model, based on the
framework established in SFAS No. 121, for long-lived assets to
be disposed of by sale.  SFAS No. 144 also broadens the
presentation of discontinued operations to include more disposal
transactions, and provides additional implementation guidance for
SFAS No. 121.  SFAS No. 144 is effective for fiscal years
beginning after December 15, 2001.  Stratus does not expect the
adoption of this statement to have a material impact on the
Company's financial position or results of operations.

Reclassifications.  Certain prior year amounts have been
reclassified to conform to the year 2001 presentation.

2.   OLYMPUS RELATIONSHIP and INVESTMENT IN UNCONSOLIDATED AFFILIATES
In May 1998, Stratus and Olympus Real Estate Corporation
(Olympus), formed a strategic alliance to develop certain of
Stratus' existing properties and to pursue new real estate
acquisition and development opportunities. Under the terms of the
agreement, Olympus made a $10 million investment in Stratus'
mandatorily redeemable preferred stock, provided a $10 million
convertible debt financing facility to Stratus and agreed to make
available up to $50 million of additional capital representing
its share of direct investments in joint Stratus/Olympus
projects. As of September 30, 2001 Olympus had invested
approximately $13.4 million in joint Stratus/Olympus projects, as
further discussed below.

    During the second quarter of 2001, Stratus repaid Olympus the
entire $3.2 million balance under the convertible debt financing
facility used to finance Stratus' interest in the Walden
Partnership in Houston, Texas, purchased in September 1998.
Included in the $3.2 million payment to Olympus was $0.8 million
of accrued interest that had been added to the principal at the
end of each subsequent quarter, and which represented the stated
12 percent annual rate pursuant to the terms of the convertible
debt financing agreement.  Stratus paid an additional $0.3
million of interest during the third quarter of 2001 to satisfy
the minimum annual rate of return provision within the
convertible debt facility agreement, which provided that if the
combination of interest at 12 percent and the value of the
conversion right did not provide Olympus with at least a 15
percent annual return on the convertible debt, Stratus would pay
Olympus additional interest upon

<PAGE>                         6

termination of the convertible
debt facility in an amount necessary to yield a 15 percent
return.   The convertible debt facility was terminated on August
15, 2001.

     Stratus has investments in three joint ventures in which it
owns a 49.9 percent interest and Olympus owns the remaining 50.1
percent interest.  Stratus accounts for its investments in the
joint ventures using the equity method of accounting.  Stratus
develops and manages each project undertaken by these joint
ventures and receives development fees, sales commissions, and
other management fees for its services.

     Stratus' three joint ventures are the Oly Stratus Barton
Creek I Joint Venture (Barton Creek Joint Venture), the Oly
Walden General Partnership (Walden Partnership) and the Stratus
7000 West Joint Venture (7000 West Joint Venture).  The Barton
Creek Joint Venture currently consists of two separate
subdivisions, "Wimberly Lane" and "Escala Drive," located in
southwest Austin, Texas.  At September 30, 2001 there was one
remaining single-family homesite at the Wimberly Lane subdivision
and 21 remaining single-family homesites at the Escala Drive
subdivision.  The Walden Partnership had 420 single-family
homesites available at the Walden on Lake Houston development in
Houston, Texas at September 30, 2001.  The 7000 West Joint
Venture consists of two fully constructed and leased 70,000
square foot office buildings located in the Lantana development
in southwest Austin.

     For a detailed discussion of the Olympus alliance and the
initial formation and subsequent transactions of the joint
ventures and partnership, see Notes 2, 3 and 4 of the "Notes To
Financial Statements" included in Stratus' 2000 Annual Report on
Form 10-K.  Also refer to "Transactions With Olympus Real Estate
Corporation" and "Capital Resources and Liquidity" included in
Items 7 and 7A., "Management's Discussion and Analysis of
Financial Condition and Results of Operations and Disclosures of
Market Risks" included in Stratus' 2000 Annual Report on Form 10-K.

    The Barton Creek Joint Venture distributed $0.7 million to
the partners during the first quarter of 2001; however, it made
no distributions to the partners during either the second or
third quarters of 2001.  From inception through September 30,
2001 the Barton Creek Joint Venture has distributed $17.1 million
to the partners.  Stratus' portion of the distributions,
approximately $8.6 million, have been recorded as repayment of
the Barton Creek notes receivable and related accrued interest
($6.9 million) and a $1.7 million reduction of its investment in
the Barton Creek Joint Venture.   Stratus recorded the entire
amount of its portion of the first-quarter distribution,
approximately $0.4 million, as a reduction of its investment in
the Barton Creek Joint Venture.   Future distributions by the
Barton Creek Joint Venture will reduce Stratus' investment in the
joint venture as a return of partner's capital until Stratus'
remaining investment of $3.7 million is recovered.  During the
second quarter of 2001, the 7000 West Joint Venture distributed
approximately $0.1 million to the partners, which Stratus
recorded as a reduction of its investment in the 7000 West Joint
Venture.  There have been no distributions by the Walden
Partnership.  The summarized unaudited earnings data of Stratus'
unconsolidated affiliates is shown below (in thousands):
<TABLE>
<CAPTION>


                           Barton Creek   Walden        7000
                           Joint Venture  Partnership   West      Total
                           -------------  -----------  -------   --------
<S>                         <C>            <C>         <C>       <C>
Quarter ended
September 30, 2001:
Revenues                    $     750      $  617      $ 873     $  2,240
Operating loss                    (77)       (203)       (77)        (357)
Net loss                          (76)       (170)       (55)        (301)
Stratus' equity in net loss       (38)        (74)       (28)        (140)


Quarter ended
September 30, 2000:
Revenues                    $   5,160     $   657      $  347    $  6,164
Operating income (loss)         1,761        (278)        (10)      1,473
Net income (loss)               1,761        (377)         (8)      1,376
Stratus' equity in net
income (loss)                     879        (174)a        (4)        701 a

</TABLE>
<PAGE>                                       7

<TABLE>
<CAPTION>
                           Barton Creek     Walden      7000
                           Joint Venture  Partnership   West      Total
                           -------------  -----------  -------   --------
<S>                           <C>         <C>          <C>       <C>
Nine months ended
September 30, 2001:
Revenues                    $     973     $ 2,156      $ 2,434   $  5,563
Operating loss                   (183)       (473)        (234)      (890)
Net loss                         (175)       (339)        (166)      (680)
Stratus' equity in net loss       (87)       (135)a        (83)      (305)a


Nine months ended
September 30, 2000:
Revenues                    $  13,924     $ 2,083      $   756   $ 16,763
Operating income (loss)         3,567        (559)        (540)     2,468
Net income (loss)               3,630        (510)        (530)     2,590
Stratus' equity in net
income (loss)                   1,814        (218)a       (265)     1,331 a

</TABLE>

a.   Includes recognition of deferred income totaling $11,000
  during the third quarter of 2001 and $14,000 in the third quarter
  of 2000. The nine month periods include recognition of deferred
  income totaling $34,000 in 2001 and $37,000 in 2000.  The
  deferred income represents the difference in Stratus' investment
  in the Walden Partnership and its underlying equity at the date
  of acquisition.  Stratus will recognize the remaining deferred
  income as the related real estate is sold. Through September 30,
  2001, Stratus has recognized $143,000 of a total of $337,000 of
  deferred income associated with the Walden Partnership.

3.  EARNINGS PER SHARE
The earnings per share calculations have been restated to reflect
the effects of the stock split transactions (see Note 6) as if
they had occurred at the beginning of each period presented.  The
following table is a reconciliation of net income and weighted
average common shares outstanding for purposes of calculating
basic and diluted net income per share (in thousands, except per
share amounts):

<TABLE>
<CAPTION>
                                              Three Months         Nine Months
                                           Ended September 30, Ended September 30,
                                           ------------------   -----------------
                                             2001     2000       2001      2000
                                           -------   -------    -------  --------

<S>                                        <C>        <C>       <C>       <C>
Basic net income per share of
 common stock:
Net income                                 $ 3,056    $  164    $ 4,166   $ 8,017
                                           -------    ------    -------   -------
Weighted average common shares
 outstanding                                 7,112     7,149      7,152     7,148
                                            ------    ------    -------   -------
Basic net income per share of
 common stock                                $0.43     $0.02      $0.58     $1.12
                                             =====     =====      =====     =====
Diluted net income per share of
 common stock:
Net income                                 $ 3,056    $  164    $ 4,166   $ 8,017
                                           -------    ------    -------   -------
Weighted average common shares outstanding   7,112     7,149      7,152     7,148
Dilutive stock options                         189       146        112       136
Assumed redemption of preferred stock          851       851        851       851
                                           -------    ------    -------   -------
Weighted average common shares
 outstanding for purposes of calculating
 diluted net income per share                8,152     8,146      8,115     8,135
                                           -------    ------    -------   -------
Diluted net income per share                 $0.37     $0.02      $0.51     $0.99
                                             =====     =====      =====     =====
</TABLE>

    Interest accrued on the convertible debt outstanding totaled
approximately $83,000 for the third quarter of 2000 and $248,000
for the nine months ended September 30, 2000. Although the debt
was convertible into 404,000 shares for the three and nine months
periods ending September 30, 2000, these shares were excluded
from the diluted net income per share calculation because the
effect of an assumed redemption of the convertible debt was anti-
dilutive.  Stratus repaid all borrowings under its convertible
debt facility during the

<PAGE>                              8

second quarter of 2001. There have been
no dividends accrued on Stratus' mandatorily redeemable preferred
stock through September 30, 2001.

    Outstanding stock options excluded from the computation of
diluted net income per share of common stock because their
exercise prices were greater than the average market price of the
common stock during the period are as follows:

<TABLE>
<CAPTION>
                               Third Quarter         Nine Months
                            ------------------    ------------------
                              2001      2000       2001       2000
                            -------    -------    -------    -------
<S>                         <C>        <C>        <C>        <C>
Outstanding options         142,000    155,000    399,000    265,000
Average exercise price       $12.38     $12.14     $10.26     $10.70

</TABLE>

4. LAKEWAY TRANSACTION
Since mid-1998 Stratus has provided development, management,
operating and marketing services for the Lakeway project near
Austin, Texas, which is owned by Commercial Lakeway Limited
Partnership, an affiliate of Credit Suisse First Boston, for a
fixed monthly fee.  In January 2001, Stratus and Commercial
Lakeway Limited Partnership entered into an expanded development
management agreement covering a 552-acre portion of the Lakeway
development known as Schramm Ranch and Stratus contributed $2.0
million as an investment in this project.  The agreement provides
for Stratus to receive enhanced management and development fees
and sales commissions, as well as a net profits interest in the
project.

5. RESTRICTED CASH
At September 30, 2001, Stratus had restricted cash deposits
totaling $0.2 million to fund the purchase of fractional shares
of its common stock resulting from its stock split transactions
(see Note 6).

6.  STOCK SPLIT TRANSACTIONS
On May 10, 2001, the shareholders of Stratus approved an
amendment to Stratus' certificate of incorporation to permit a
reverse 1-for-50 common stock split followed immediately by a
forward 25-for-1 common stock split.  This transaction resulted
in Stratus' shareholders holding fewer than 50 shares of common
stock having their shares converted into less than one share in
the reverse 1-for-50 split, for which they received cash payments
equal to the fair value of those fractional interests.  Stratus
shareholders holding more than 50 shares of Stratus' common stock
had their number of shares common stock reduced by one-half
immediately after this transaction.  Shareholders holding an odd
number of shares were entitled to a cash payment equal to the
fair value of the resulting fractional share.   The fair value of
the fractional shares was calculated by valuing each outstanding
share of Stratus common stock held at the close of business on
the effective date, May 25, 2001, at the average daily closing
price per share of Stratus' common stock for the ten trading days
immediately preceding the effective date.  Stratus funded $0.5
million into a restricted cash account to purchase approximately
42,000 post-stock split shares of its common stock.  As of
September 30, 2001, fractional shares representing approximately
21,000 shares of Stratus' common stock had been purchased for
$0.25 million. The number of shares outstanding of Stratus'
mandatorily redeemable preferred stock (see Note 3 of "Notes To
Financial Statements" included in Stratus' 2000 Annual Report on
Form 10-K) is not affected by this transaction; however, the
conversion price in effect immediately prior to the transaction
was approximately doubled to reflect the effects of these
transactions.

                      --------------------
                             Remarks

The  information furnished herein should be read  in  conjunction
with  Stratus' financial statements contained in its 2000  Annual
Report  on Form 10-K.  The information furnished herein  reflects
all   adjustments  which  are,  in  the  opinion  of  management,
necessary  for a fair statement of the results for  the  periods.
All  such  adjustments are, in the opinion of  management,  of  a
normal recurring nature.

<PAGE>                            9


            REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders
   of Stratus Properties Inc.:

We have reviewed the accompanying condensed balance sheet of
Stratus Properties Inc. (a Delaware corporation), as of September
30, 2001, and the related statements of income for the three and
nine-month periods ended September 30, 2001 and 2000, and the
statements of cash flows for the nine-month periods ended
September 30, 2001 and 2000. These financial statements are the
responsibility of the Company's management.

We conducted our reviews in accordance with standards established
by the American Institute of Certified Public Accountants.  A
review of interim financial information consists principally of
applying analytical procedures to financial data and making
inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit
conducted in accordance with auditing standards generally
accepted in the United States, the objective of which is the
expression of an opinion regarding the financial statements taken
as a whole.  Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material
modifications that should be made to the financial statements
referred to above for them to be in conformity with accounting
principles generally accepted in the United States.

We have previously audited, in accordance with auditing standards
generally accepted in the United States, the balance sheet of
Stratus Properties Inc. as of December 31, 2000, and the related
statements of income, stockholders' equity and cash flows for the
year then ended (not presented herein), and in our report dated
January 25, 2001, we expressed an unqualified opinion on those
financial statements. In our opinion, the information set forth
in the accompanying condensed balance sheet as of December 31,
2000, is fairly stated, in all material respects, in relation to
the balance sheet from which it has been derived.

                                 /s/  ARTHUR ANDERSEN LLP

Austin, Texas
October 26, 2001

<PAGE>                        10


Item  2.   Management's  Discussion  and  Analysis  of  Financial
Condition and Results of Operations.

                            OVERVIEW

   Management's discussion and analysis presented below should be
read in conjunction with our discussion and analysis and
financial results contained in our 2000 Annual Report on Form 10-
K. The operating results summarized in this report are not
necessarily indicative of our future operating results.

    We acquire, develop, manage and sell commercial and
residential real estate.  We conduct real estate operations on
properties we own and through unconsolidated affiliates we
jointly own with Olympus Real Estate Corporation (Olympus)
pursuant to a strategic alliance formed in May 1998 (see Note 2).

                     DEVELOPMENT ACTIVITIES
Stratus Properties
     We have reached agreement with the City of Austin (the City)
concerning development of a 417-acre portion of the Lantana
project.  The agreement reflects a cooperative effort between the
City and us to allow development based on grandfathered
entitlements, while adhering to stringent water quality standards
and other enhancements to protect the environment.  With this
most recent agreement, we have now completed the core entitlement
process for the entire Lantana project allowing approximately 2.9
million square feet of office and retail development,
approximately 400 multi-family units (previously sold to an
unrelated third party, see below), and approximately 330
residential lots.

     In the fourth quarter of 2000 we received final subdivision
plat approval from the City to develop approximately 170 acres of
commercial and multi-family real estate within our Lantana
development.  The required infrastructure development at the
site, known as "Rialto Drive," is nearing completion and final
completion is expected early in the fourth quarter of 2001.
Construction of the first of two 75,000 square foot office
buildings at Rialto Drive (7500 Rialto) is proceeding as planned
and should be substantially complete by year-end 2001.
Construction of the office buildings at Rialto is now utilizing
borrowings available to us under a new project development loan
(see "Capital Resources and Liquidity" below).  Full development
of the 170 acres is expected to consist of over 800,000 square
feet of office and retail space and 400 multi-family units, which
are now being constructed by an apartment developer pursuant to
our sale of a 36.4-acre multi-family tract in December 2000 (see
"Result of Operations" below).

     We continue to work on residential development plans for
portions of our Circle C project. During the third quarter of
2001, we met with City of Austin representatives and with
neighborhood and environmental groups to discuss a plan to modify
portions of the land plan and provide enhanced water quality
protection for portions of the Circle C project.

     We commenced construction of a new subdivision within the
Barton Creek community during the fourth quarter of 2000.  This
subdivision, Mirador, is now complete and marketing efforts have
commenced.  Mirador adjoins the Escala Drive subdivision, which
is owned by our Barton Creek Joint Venture (see below).  The
Mirador subdivision consists of 34 estate lots, averaging 3.5
acres in size.

     We are also completing the permitting of two new residential
sections at Barton Creek.  The first is a 114-acre tract with 54
lots ranging in size from one-third acre to multi-acre estate
lots, some of which overlook the Lost Creek Country Club golf
course.  This project is expected to receive final approval
during the fourth quarter of 2001.  The second section is a 212-
acre tract that includes 125 single-family lots and nine acres
for condominium development.  Some of these lots will adjoin the
Fazio Canyons golf course.  This project is expected to receive
final approval by early 2002.  Development activities will be
deferred until the Austin-area economy improves (see "Capital
Resources and Liquidity" below.)

Unconsolidated Affiliates
    We own a 49.9 percent interest in three joint ventures and
Olympus, our partner, owns the remaining 50.1 percent interest in
each of the joint ventures.  Accordingly, we account for our
investments in these joint ventures using the equity method of
accounting.  We develop and manage each project undertaken by
these joint ventures and receive development fees, sales
commissions, and other management fees for our services.  See
Note 2 included elsewhere in this Form 10-Q for the summarized
unaudited results of operations of our unconsolidated affiliates
for the three and nine-month periods ended September 30, 2001 and
2000.

<PAGE>                              11

Barton Creek Joint Venture
     The Oly Stratus Barton Creek I Joint Venture (Barton Creek
Joint Venture) currently consists of two separate subdivisions:
"Wimberly Lane" and "Escala Drive."  Construction of the Wimberly
Lane subdivision, consisting of 75 developed residential lots,
was completed during the first quarter of 1999.  We had only one
Wimberly Lane lot remaining to be sold at September 30, 2001.  We
sold two Wimberly Lane lots during the first quarter of 2001 for
a total of $0.2 million.  We sold no Wimberly Lane lots during
the second and third quarters of 2001.  During the third quarter
of 2000, we sold four Wimberly Lane lots for $0.4 million and a
total of 25 lots during the nine months ended September 30, 2000
for $3.0 million.

     Construction of the Escala Drive subdivision was completed
during the second quarter of 2000.  As of September 30, 2001, 33
of the original 54 multi-acre residential lots have been sold.
These residential lots, as well as the developed lots at our
Mirador subdivision (see "Stratus Properties" above), are the
largest developed to date within the Barton Creek community.  One
Escala Drive lot was sold during the third quarter of 2001 for
$0.8 million; however, there were no Escala Drive residential lot
sales during the first half of 2001 (see "Capital Resources and
Liquidity" below).  During the third quarter of 2000, we sold ten
of the Escala Drive residential lots for $4.8 million and a total
of 25 lots during the nine months ended September 30, 2000 for
$10.9 million.

     The Barton Creek Joint Venture distributed approximately
$0.7 million to the partners in the first quarter of 2001.  We
recorded our share of these distributions, approximately $0.4
million, as a return of our investment in the joint venture.
There were no distributions to the partners during the second or
third quarters of 2001. The Barton Creek Joint Venture
distributed approximately $4.6 million to the partners in the
third quarter of 2000 and a total of $12.1 million for the nine
months ended September 30, 2000.  Our share of the distribution
proceeds totaled approximately $2.3 million during the third
quarter of 2000 and $6.1 million for the nine months ended
September 30, 2000.

Walden Partnership
     At September 30, 2001, the Walden Partnership had 420 single-
family homesites available for sale at the Walden on Lake Houston
development in Houston, Texas.  The Partnership sold 24 single-
family homesites during the third quarter of 2001 and a total of
73 single-family homesites during the nine months ended September
30, 2001, compared with sales of 31 and 80 single-family
homesites during the comparable periods last year. In September
1998, we deposited $2.5 million of restricted cash as additional
collateral for the related project development loan facility.
The remaining restricted deposit totaled $0.6 million at December
31, 2000.  During the third quarter of 2001, the Walden
Partnership repaid all remaining borrowings outstanding under its
project development loan facility and our remaining $0.4 million
of restricted cash was released.

7000 West
     We have two fully leased and occupied 70,000 square foot
office buildings at the Lantana Corporate Center, known as 7000
West.  In our role as manager of 7000 West, we arranged for a
$6.6 million project loan facility to finance construction of the
first office building. The construction of the second building
required additional financing, which was provided by an
additional $7.7 million financing under the 7000 West development
loan facility negotiated in the first quarter of 2000.
Borrowings outstanding under 7000 West's project loan facility
totaled $13.0 million at September 30, 2001 and $12.0 million at
December 31, 2000.  The project loan facility was originally
scheduled to mature on August 24, 2001.  However, as manager of
7000 West, we successfully negotiated an extension of the term
loan with Comerica Bank-Texas (Comerica) to August 24, 2002 with
the option to extend the maturity to August 24, 2003, subject to
certain conditions.

<PAGE>                         12

                      RESULTS OF OPERATIONS

      Summary operating results follow (in thousands):
<TABLE>
<CAPTION>
                                          Third Quarter          Nine-Months
                                         -----------------    ------------------
                                          2001      2000        2001      2000
                                         -------   -------    --------   -------
<S>                                      <C>       <C>        <C>       <C>
Revenues:
  Undeveloped properties:
     Unrelated parties                   $ 3,250   $   -      $  9,623   $   342
     Recognition of deferred revenues        840     1,213       3,479     3,729
  Developed properties                       -         108         -         704
 Commissions, management fees and other      369       698         996     2,299
                                         -------   -------    --------   -------
  Total revenues                         $ 4,459   $ 2,019    $ 14,098   $ 7,074
                                         =======   =======    ========   =======

Operating income (loss)                  $ 3,192   $  (492)   $  4,688   $  (650)
                                         =======   =======    ========   =======

Net income                               $ 3,056   $   164    $  4,166   $ 8,017
                                         =======   =======    ========   =======
</TABLE>

Operating Results

     Our revenues during the third quarter and nine months ended
September 30, 2001 primarily reflect the sale of undeveloped
entitled properties to unrelated third parties.  During the third
quarter of 2001, we sold a 41-acre undeveloped tract in Austin,
Texas for $3.3 million.  During the first half of 2001 our
undeveloped property revenues included the sale of 112 acres of
undeveloped entitled residential property in Houston, Texas for
$2.7 million, the sale of 10 acres of undeveloped entitled
property in Dallas, Texas for $1.7 million and one 17-acre
undeveloped tract sale in Austin, Texas totaling $2.0 million.
Revenues from undeveloped properties during the nine months ended
September 30, 2000 reflect the sale of one acre of multi-family
property in San Antonio, Texas.

       The majority of the deferred revenue recognized during the
third quarter and nine months ended September 30, 2001 was
associated with the sale of a 36.4-acre multi-family tract within
the Rialto Drive project in December 2000.  In this transaction
we sold the property for $5.3 million but deferred $3.6 million
of the sale.  We are recognizing this deferred revenue pro rata
as the required infrastructure construction is completed.  As
discussed in  "Development Activities" above, construction at the
Rialto Drive project is nearly complete, resulting in our
recognizing deferred revenues of $0.7 million during the third
quarter of 2001 and $3.3 million during the nine months ended
September 30, 2001. The remaining $0.3 million of deferred
revenue will be recognized when the project is completed during
the fourth quarter of 2001.

      When we sell real estate to an entity we jointly own with
Olympus, we defer recognizing revenues from the sale related to
our ownership interest until sales are made to unrelated parties.
The Barton Creek Joint Venture sold two Wimberly Lane single-
family homesites during the first quarter of 2001 and one Escala
Drive homesite during the third quarter of 2001, which resulted
in our recognition of previously deferred revenues of $0.2
million for the nine-month 2001 period.   Sales by the Barton
Creek Joint Venture during 2000 resulted in our recognition of
previously deferred revenues of $1.2 million and $0.6 million of
related operating income during the third quarter of 2000 and
recognition of previously deferred revenues of $3.2 million and
$1.6 million of related operating income during the nine months
ended September 30, 2000.  During the second quarter of 2000, we
also recognized $0.5 million of previously deferred revenues and
$0.4 million of related operating income associated with our sale
of 5.5 acres of commercial real estate to the 7000 West Joint
Venture.  At September 30, 2001 we had a total of $2.0 million of
deferred revenues and $1.1 million of related operating income
remaining to be recognized from future sales of real estate by
the Barton Creek Joint Venture.

    We have sold no developed lots during 2001; however, our
Mirador subdivision (see "Development Activities," above) is now
complete and we are currently marketing these lots.  Our third-
quarter 2000 developed property revenues included the sale of
three single-family homesites and we sold 24 developed lots
during the nine months ended September 30, 2000.  Lots sales by
our unconsolidated affiliates are not included in our developed
property revenues (see "Unconsolidated Affiliates" above).

<PAGE>                        13

    Commissions, management fees and other income totaled $0.4
million during the third quarter of 2001 and $1.0 million during
the nine months ended September 30, 2001 compared to $0.7 million
and $2.3 million during the comparable periods last year.  The
decrease during 2001 from the same periods last year primarily
reflects the decrease in sales by our unconsolidated affiliates,
particularly the Barton Creek Joint Venture, which represent a
significant portion of our sales commissions.  See "Capital
Resources and Liquidity" below for a discussion of our expanded
management services agreement associated with the Lakeway project
near Austin, Texas.

    Cost of sales decreased to $0.8 million in the third quarter
of 2001 from $1.6 million during the third quarter of 2000
primarily reflecting the decrease in sales from our
unconsolidated affiliates partially offset by the $0.1 million of
costs associated with the sale of a 41-acre tract during the
third quarter of 2001.  Cost of sales increased to $7.5 million
during the nine months ended September 30, 2001 from $5.0 million
during the comparable nine-month period in 2000, primarily
reflecting the significant sales of undeveloped entitled
properties during the second quarter of 2001.  The increase in
cost of sales during the nine months ended September 30, 2001 was
partially offset by a reimbursement of certain infrastructure
costs previously charged to expense or relating to properties
previously sold, which reduced our first quarter of 2001 cost of
sales by $0.8 million, and reduced sales activity of our
unconsolidated affiliates throughout 2001.

    Our general and administrative expenses decreased to $0.5
million during the third quarter of 2001 and $1.9 million for the
nine months ended September 30, 2001 from $0.9 million and $2.7
million during the comparable periods in 2000.  The decrease
between the periods primarily reflects reduced administrative
costs resulting from the implementation of a new information
system and other initiatives to reduce costs.

Non-Operating Results

    Interest expense, net of capitalized interest, totaled $0.5
million for the nine months ended September 30, 2001 compared to
$0.6 million for the nine months ended September 30, 2000.
Interest expense, net of capitalized interest, totaled $0.2
million during the third quarter of 2000.  All our interest costs
were capitalized during the third quarter of 2001.  Capitalized
interest totaled $0.4 million for the third quarter of 2001 and
$0.9 million for the nine months ended September 30, 2001
compared to $0.3 million during the third quarter of 2000 and
$1.0 million during the nine months ended September 30, 2000.

    In March 2000, the City approved a settlement agreement of
all its disputes with other Austin-area real estate developers
and landowners concerning the Circle C community.  Under terms of
this settlement, the lawsuits contesting the City's December 1997
annexation of all land within the four Circle C Municipal Utility
Districts (MUDs) and the dissolution of the four MUDs were
dismissed with prejudice.  Accordingly, the City's partial
payments of our reimbursement claim, totaling $10.5 million as of
March 31, 2000, were no longer subject to a repayment
contingency.  As a result, we recorded approximately $7.4 million
of these previously deferred proceeds in other income during the
first quarter of 2000. This amount represents that portion of the
reimbursed infrastructure expenditures in excess of our remaining
basis in these assets, as well as related interest income on the
reimbursements. The remaining $3.1 million was recorded as a
reduction of our investment in Circle C.  We settled our disputes
with the City related to the remaining amounts of the Circle C
MUDs in the fourth quarter of 2000, when we received $6.9 million
from the City as full and final settlement of our claim.  See
Note 6 to the "Notes To Financial Statements" included within our
2000 Annual Report on Form 10-K for discussion of the settlement
of our Circle C MUD reimbursement claim.

                 CAPITAL RESOURCES AND LIQUIDITY

     Net cash provided by operating activities totaled $2.9
million during the nine months ended September 30, 2001 compared
to $4.8 million during the nine months ended September 30, 2000.
The decrease primarily reflects reduced distributions received
from the Barton Creek Joint Venture offset in part by our
increased revenues from our undeveloped entitled properties
sales. Cash used in investing activities totaled $21.6 million
for the nine months ended September 30, 2001 compared with $3.7
million during the same period in 2000, reflecting an increase in
our net real estate and facilities expenditures (see "Development
Activities" above) and the $2.0 million investment in the Lakeway
project, near Austin, Texas (see below).  Financing activities
provided cash of $11.3 million during the first nine months of
2001 reflecting borrowings under our Comerica credit facility and
our successful negotiations to obtain a second $5.0 million
unsecured term loan, offset in part by the $3.2 million repayment
to Olympus under the convertible debt credit facility (see below).

<PAGE>                          14

     At September 30, 2001, we had debt outstanding of $20.1
million compared to $8.4 million at December 31, 2000 and $15.4
million at September 30, 2000.  Our debt outstanding at September
30, 2001 included $10.0 million of borrowings under our unsecured
term loans (see below), with the first $5.0 million term loan
maturing in December 2005 and the newly obtained $5.0 million
term loan maturing in July 2006.  We had $9.9 million of
borrowings at September 30, 2001 under our $20 million revolver,
which matures in December 2002.  The availability under the $20
million revolving line of credit was reduced to $18.0 million to
satisfy the $2.0 million interest reserve account requirement at
September 30, 2001.  For a discussion of our bank credit
facilities see Note 5 included in the "Notes To Financial
Statements" included in our 2000 Annual Report on Form 10-K.

     During the second quarter of 2001, we repaid Olympus the
entire $3.2 million balance under our convertible debt facility
used to acquire our interest in the Walden Partnership in
Houston, Texas in September 1998.  We repaid the convertible debt
with a portion of the proceeds from our recently negotiated
additional $5.0 million five-year unsecured term loan with First
American Asset Management. By exchanging the convertible debt for
the term loan debt, we have avoided the potential dilutive effect
of Olympus converting the debt into shares of our common stock
and reduced our related financing cost from 12 percent to 9.25
percent.  We will use the remainder of the proceeds from the $5.0
million unsecured term loan to fund our ongoing operations and
for other general corporate purposes.

     In the second quarter of 2001, we secured an $18.4 million
project loan facility with Comerica for the construction of the
two office buildings at the 7500 Rialto project (see "Development
Activities" above).  This variable-rate project loan facility
matures in June 2003, with an option to extend the maturity by
one year.  Currently our availability under the project loan is
$9.2 million and is intended for the construction of the first
75,000 square foot office building and a related parking garage.
At September 30, 2001 we had borrowings totaling $0.3 million
under this project loan facility.

     Since mid-1998 we have provided development, management,
operating and marketing services for the Lakeway project near
Austin, Texas, which is owned by Commercial Lakeway Limited
Partnership, an affiliate of Credit Suisse First Boston, for a
fixed monthly fee.  In January 2001, we entered into an expanded
development management agreement with Commercial Lakeway Limited
Partnership covering a 552-acre portion of the Lakeway
development known as Schramm Ranch, and we contributed $2.0
million as an investment in this project.  Under the agreement we
receive enhanced management and development fees and sales
commissions, as well as a net profits interest in the project.

     During the second quarter of 2001, we negotiated an
agreement to sell the entire Schramm Ranch property to a single
purchaser for approximately $11.0 million, conditioned on
obtaining certain entitlements. As manager of the project, we
obtained subdivision, annexation, zoning and other entitlements
for the first phase of the Schramm Ranch project.  Obtaining
these entitlements allowed for the sale of the first phase of the
Schramm Ranch project for $1.5 million.  The proceeds from this
initial sales transaction are being used to obtain entitlements
for the remaining 500-plus acres of the property.  We expect to
obtain those entitlements during the fourth quarter of 2001,
allowing at least one additional phase to be sold in 2001. We
believe that we will receive a portion of the sales proceeds in
connection with our net profits interest in the project when the
sale of the second phase occurs.

     In February 2001, our Board of Directors authorized an open
market stock purchase program for up to 0.7 million shares of our
common stock representing approximately 10 percent of our
outstanding common stock, after considering the effects of the
stock split transactions described in the following paragraph.
The purchases may occur over time depending on many factors,
including the market price of our common stock; our operating
results, cash flows and financial position; possible redemption
of our mandatorily redeemable preferred stock held by Olympus;
and general economic and market conditions.  We have yet to make
any open market share purchases under this program as of October
26, 2001.

     On May 10, 2001, our shareholders approved an amendment to
our certificate of incorporation to permit a reverse 1-for-50
common stock split followed immediately by a forward 25-for-1
common stock split. The effective date of this transaction was
May 25, 2001.  This transaction resulted in our shareholders
holding fewer than 50 shares of common stock having their shares
converted into less than one share of our common stock in the
reverse 1-for-50 split.  Those shareholders received cash
payments equal to the fair value of those fractional interests.
Our shareholders holding more than 50 shares of our common stock
had their number of shares of common stock reduced by one-half
immediately after this transaction.  Shareholders holding an odd

<PAGE>                         15

number of shares were entitled to a cash payment equal to the
fair value of the resulting fractional share.   The fair value of
the fractional shares was calculated by valuing each outstanding
share of Stratus common stock held at the close of business on
the effective date at the average daily closing price per share
of Stratus' common stock for the ten trading days immediately
preceding the effective date.  Accordingly, we funded $0.5
million into a restricted cash account to purchase approximately
42,000 shares of our common stock.  As of September 30, 2001,
fractional shares representing approximately 21,000 shares of our
common stock had been purchased for $0.25 million. We expect this
transaction, including the funding of the remaining share
purchases, to lower our future reporting and related costs.

     Our future operating cash flows and, ultimately, our ability
to develop our properties and expand our business will be largely
dependent on the level of our future real estate sales.  In turn,
these sales will be significantly affected by future real estate
values, regulatory issues, development costs, interest rate
levels and our ability to continue to protect our land use and
development entitlements. Significant development expenditures
remain to be incurred for our Austin-area properties prior to
their eventual sale.   As a result of our settlement of certain
entitlement and reimbursement issues with the City during 2000
and 2001, we have proceeded to develop a significant portion of
our Austin-area properties with capital expenditures in 2001 that
have significantly exceeded the development expenditures incurred
during each of the past three years.  However, because of the
decrease in our sales activities resulting from the recent
downturn in the information technology business sector, which has
negatively affected Austin's business climate, we are planning to
defer some of our remaining near-term development plans until the
real estate market improves.

     We are continuing to actively pursue additional development
and management fee opportunities, both individually and through
our existing relationships with institutional capital sources.
We also believe we can obtain bank financing at a reasonable cost
for developing our properties (see above). However, obtaining
land acquisition financing is generally expensive and uncertain.

                      CAUTIONARY STATEMENT

    Management's discussion and analysis of financial condition
and results of operations contains forward-looking statements
regarding anticipated sales, debt repayments, future
reimbursement for infrastructure costs, future events related to
financing and regulatory matters, the expected results of our
business strategy and other plans and objectives of management
for future operations and activities.   Important factors that
could cause actual results to differ materially from our
expectations include economic and business conditions, business
opportunities that may be presented to and pursued by us, changes
in laws or regulations and other factors, many of which are
beyond our control, and other factors that are described in more
detail under the heading "Cautionary Statements" in our Annual
Report on Form 10-K for the year ended December 31, 2000.

<PAGE>                         16

                  PART II. - OTHER INFORMATION

Item 1.  Legal Proceedings.

           Over the past several years we have been involved in
regulatory matters and litigation involving entitlements and/or
development of our Austin-area properties.  These matters were
settled during 2000.  For a detailed discussion on these matters
see Item 3, "Legal Proceedings" and Note 6, "Real Estate"
included in our 2000 Annual Report on Form 10-K.


Item 6.  Exhibits and Reports on Form 8-K.

      (a)   The exhibits to this report are listed in the Exhibit
Index appearing on page E-1 hereof.

          (b)  The registrant filed no Current Reports on Form 8-K
          during the period covered by this Quarterly Report on
          Form 10-Q.

<PAGE>                          17

                            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 thereunto duly authorized.

                     STRATUS PROPERTIES INC.

                         By:  /s/ C. Donald Whitmire, Jr.
                            ---------------------------------
                                 C. Donald Whitmire, Jr.
                               Vice President - Controller
                                (authorized signatory and
                               Principal Accounting Officer)

Date:   November 13, 2001

<PAGE>                        18


                     STRATUS PROPERTIES INC.
                         EXHIBIT INDEX
 Exhibit
 Number
  3.1     Amended and Restated Certificate of Incorporation
          of Stratus.  Incorporated by reference to Exhibit 3.1
          to Stratus' 1998 Form 10-K.

  3.2     By-laws of Stratus, as amended as of February 11,
          1999. Incorporated by Reference to Exhibit 3.2 to
          Stratus' 1998 Form 10-K.

  4.1     Stratus' Certificate of Designations of Series A
          Participating Cumulative Preferred Stock.  Incorporated
          by reference to Exhibit 4.1 to Stratus' 1992 Form 10-K.

  4.2     Rights Agreement dated as of May 28, 1992 between
          Stratus and Mellon Securities Trust Company, as Rights
          Agent.  Incorporated by reference to Exhibit 4.2 to
          Stratus' 1992 Form 10-K.

  4.3     Amendment No. 1 to Rights Agreement dated as of
          April 21, 1997 between Stratus and the Rights Agent.
          Incorporated by reference to Exhibit 4 to Stratus'
          Current Report on Form 8-K dated April 21, 1997.

  4.4     The loan agreement by and between Comerica Bank-
          Texas and Stratus Properties Inc., Stratus Properties
          Operating Co., L.P., Circle C Land Corp. and Austin 290
          Properties Inc. dated December 21, 1999.  Incorporated
          by reference to Exhibit 4.4 to Stratus 1999 Form 10-K.

  4.5     Certificate of Designations of the Series B
          Participating Preferred Stock of Stratus Properties
          Inc.  Incorporated by reference to Exhibit 4.1 to
          Stratus' Current Report on Form 8-K dated June 3, 1998.

  4.6     Investor Rights Agreement, dated as of May 22,
          1998, by and between Stratus Properties Inc. and
          Oly/Stratus Equities, L.P. Incorporated by reference to
          Exhibit 4.2 to Stratus' Current Report on Form 8-K
          dated June 3, 1998.

10.1      Joint Venture Agreement between Freeport-McMoRan
          Resource Partners, Limited Partnership and the
          Partnership, dated June 11, 1992.  Incorporated by
          reference to Exhibit 10.3 to Stratus' 1992 Form 10-K.

10.2      Development and Management Agreement dated and
          effective as of June 1, 1991 by and between Longhorn
          Development Company and Precept Properties, Inc. (the
          "Precept Properties Agreement"). Incorporated by
          reference to Exhibit 10.8 to Stratus' 1992 Form 10-K.

10.3      Assignment dated June 11, 1992 of the Precept
          Properties Agreement by and among FTX (successor by
          merger to FMI Credit Corporation, as successor by
          merger to Longhorn Development Company), the
          Partnership and Precept Properties, Inc. Incorporated
          by reference to Exhibit 10.9 to Stratus' 1992 Form 10-K.

10.4      Master Agreement, dated as of May 22, 1998, by and among Oly
          Fund II GP Investments, L.P., Oly Lender Stratus, L.P.,
          Oly/Stratus Equities, L.P., Stratus Properties Inc. and Stratus
          Ventures I Borrower L.L.C. Incorporated by reference to Exhibit
          99.1 to Stratus' Current Report on Form 8-K dated June 3, 1998.

10.5      Securities Purchase Agreement, dated as of May 22,
          1998, by and between Oly/Stratus Equities, L.P. and
          Stratus Properties Inc. Incorporated by reference to
          Exhibit 99.2 to Stratus' Current Report on Form 8-K
          dated June 3, 1998.

10.6      Oly Stratus Barton Creek I Amended and Restated
          Joint Venture Agreement between Oly ABC West I, L.P.
          and Stratus ABC West I, L.P. dated December 28, 1999.
          Incorporated by reference to Exhibit 10.7 to the
          Stratus 1999 Form 10-K.

<PAGE>                            E-1

10.7      Amendment No. 1 to the Oly Stratus ABC West I
          Joint Venture Agreement dated November 9, 1998.
          Incorporated by reference to Exhibit 10.11 to the
          Stratus 1998 Third Quarter 10-Q.

10.8      Management Agreement between Oly Stratus ABC West
          I Joint Venture and Stratus Management L.L.C. dated
          September 30, 1998. Incorporated by reference to
          Exhibit 10.12 to the Stratus 1998 Third Quarter 10-Q.

10.9      General Partnership Agreement dated April 8, 1998
          by and between Oly/Houston Walden, L.P. and Oly/FM
          Walden, L.P. Incorporated by reference to Exhibit 10.14
          to the Stratus 1998 Third Quarter 10-Q.

10.10     Amendment No. 1 to the General Partnership
          Agreement dated September 30, 1998 by and among
          Oly/Houston Walden, L.P., Oly/FM Walden, L.P. and
          Stratus Ventures I Walden, L.P.  Incorporated by
          reference to Exhibit 10.15 to the Stratus 1998 Third
          Quarter 10-Q.

10.11     Development Loan Agreement dated September 30,
          1998 by and between Oly Walden General Partnership and
          Bank One, Texas, N.A. Incorporated by reference to
          Exhibit 10.16 to the Stratus 1998 Third Quarter 10-Q.

10.12     Guaranty Agreement dated September 30, 1998 by and
          between Oly Walden General Partnership and Bank One,
          Texas, N.A. Incorporated by reference to Exhibit 10.17
          to the Stratus 1998 Third Quarter 10-Q.

10.13     Management Agreement dated April 9, 1998 by and
          between Oly/FM Walden, L.P. and Stratus Management,
          L.L.C. Incorporated by reference to Exhibit 10.18 to
          the Stratus 1998 Third Quarter 10-Q.

10.14     Amended and Restated Joint Venture Agreement dated
          August 16, 1999 by and between Oly Lantana, L.P., and
          Stratus 7000 West, Ltd. Incorporated by reference to
          Exhibit 10.18 to the Quarterly Report on Form 10-Q of
          Stratus for the Quarter ended September 30, 1999.

10.15     Guaranty Agreement dated December 31, 1999 by and
          between Stratus Properties Inc. and Comerica Bank-
          Texas.  Incorporated by reference to Stratus' Quarterly
          Report on Form 10-Q  for the Quarter ended March 31,
          2000.

10.16     Guaranty Agreement dated February 24, 2000 by and
          between Stratus Properties Inc. and Comerica Bank-
          Texas. Incorporated by reference to Stratus' Quarterly
          Report on Form 10-Q  for the Quarter ended March 31,
          2000.

10.17     Development Management Agreement by and between
          Commercial Lakeway Limited Partnership, as owner, and
          Stratus Properties Inc., as development manager, dated
          January 26, 2001.

10.18     Amended Loan Agreement dated December 27, 2000 by and
          between Stratus Properties Inc. and Comerica-Bank
          Texas.  Incorporated by reference to Exhibit 10.19 to
          the Stratus 2000 Form 10-K.

10.19     Loan Agreement dated December 28, 2000 by and between
          Stratus Properties Inc. and Holliday Fenoliglio Fowler,
          L.P., subsequently assigned to an affiliate of First
          American Asset Management.  Incorporated by reference
          to Exhibit 10.20 to the Stratus 2000 Form 10-K.

10.20     Loan Agreement dated June 14, 2001 by and between
          Stratus Properties Inc. and Holliday Fenoliglio Fowler,
          L.P., subsequently assigned to an affiliate of First
          American Asset Management.

10.21     Stratus' Performance Incentive Awards Program, as
          amended effective February 11, 1999. Incorporated by
          reference to Exhibit 10.18 to Stratus' 1998 Form 10-K.

10.22     Stratus Stock Option Plan, as amended.
          Incorporated by reference to Exhibit 10.9 to Stratus'
          1997 Form 10-K.

10.23     Stratus 1996 Stock Option Plan for Non-Employee
          Directors, as amended. Incorporated by reference to Exhibit
          10.10 to Stratus' 1997 Form 10-K.

10.24     Stratus Properties Inc. 1998 Stock Option Plan as
          amended effective February 11, 1999. Incorporated by reference to
          Exhibit 10.21 to Stratus' 1998 Form 10-K.

15.1      Letter dated October 26, 2001 from Arthur Andersen
          LLP regarding the unaudited financial statements.

<PAGE>                            E-3