# EDGAR Filing Document

**Accession Number:** 0000733590
**File Stem:** 0000733590-23-000006
**Filing Date:** 2023-3
**Character Count:** 12412
**Document Hash:** 5d584397ca9439fce16274923ecbb6ce
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000733590-23-000006.hdr.sgml**: 20230324

**ACCESSION NUMBER**: 0000733590-23-000006

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 13

**CONFORMED PERIOD OF REPORT**: 20230324

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230324

**DATE AS OF CHANGE**: 20230324

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** TRANSCONTINENTAL REALTY INVESTORS INC
- **CENTRAL INDEX KEY:** 0000733590
- **STANDARD INDUSTRIAL CLASSIFICATION:** REAL ESTATE INVESTMENT TRUSTS [6798]
- **IRS NUMBER:** 946565852
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-09240
- **FILM NUMBER:** 23758517

**BUSINESS ADDRESS:**
- **STREET 1:** 1603 LBJ FREEWAY
- **STREET 2:** SUITE 800
- **CITY:** DALLAS
- **STATE:** TX
- **ZIP:** 75234
- **BUSINESS PHONE:** 4695224200

**MAIL ADDRESS:**
- **STREET 1:** 1603 LBJ FREEWAY
- **STREET 2:** SUITE 800
- **CITY:** DALLAS
- **STATE:** TX
- **ZIP:** 75234

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** JOHNSTOWN CONSOLIDATED REALTY TRUST /CA/
- **DATE OF NAME CHANGE:** 19890815

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** JOHNSTOWN CONSOLIDATED REALTY TRUST
- **DATE OF NAME CHANGE:** 19861005

?xml version="1.0" ? tci-20230324

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM 8-K**

**Current Report**

**Pursuant to Section 13 or 15(d)**

**of the Securities Exchange Act of 1934**

Date of Report (Date of earliest event reported) March 24, 2023

**Transcontinental Realty Investors, Inc.**

(Exact name of registrant as specified in its charter)

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| | | | | |
|:---|:---|:---|:---|:---|
| **Nevada** | | **001-09240** | **001-09240** | **94-6565852** |
| (State or other jurisdiction of <br>Incorporation or organization) | | (Commission File Number) | (Commission File Number) | (IRS Employer Identification Number) |
| **1603 LBJ Freeway,** | **Suite 800** | **Dallas** | **TX** | **75234** |
| (Address of principal executive offices) | (Address of principal executive offices) | (Address of principal executive offices) | (Address of principal executive offices) | (Zip Code) |

---

**(469) 522-4200**

Registrant's Telephone Number, including area code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Securities Act (17 CFR 230.425)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Securities Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Securities Act (17 CFR 240.413e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

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| | | |
|:---|:---|:---|
| **<u>Title of each class</u>** | **<u>Trading Symbol(s)</u>** | **<u>Name of each exchange on which registered</u>** |
| Common Stock | TCI | NYSE |

---

Indicate by check mark whether teh Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ((17 CFR 230.405 of or Rule 12b-2 of the Securities Act of 1934 (17 CFR 230.405):

☐ Emerging growth company

If an emerging growth company indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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**Section 2 – Financial Information**

**Item 2.02. Results of Operations and Financial Condition**

On March 24, 2023, Transcontinental Realty Investors, Inc. ("TCI" or the "Company") announced its operational results for the quarter ended December 31, 2022. A copy of the announcement is attached as Exhibit "99.1."

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

**Section 9 – Financial Statements and Exhibits**

**Item 9.01. Financial Statements and Exhibits**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Exhibits.

The following exhibit is furnished with this Report:

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| | | |
|:---|:---|:---|
| **Exhibit No.** | **Description** | |
| <u>[99.1\*](tci20221231ex991earnings.htm)</u> | Press release dated | March 24, 2023 |

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_________________________

\* Furnished herewith

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**SIGNATURES**

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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| | | |
|:---|:---|:---|
| | | TRANSCONTINENTAL REALTY INVESTORS, INC. |
| Dated: November 10, 2022 | By: | /s/ ERIK L. JOHNSON |
|  |  | Erik L. Johnson |
|  |  | Executive Vice President and Chief Financial Officer |
|  |  | (Principal Executive and Financial Officer) |

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## Exhibit 99.1

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| | |
|:---|:---|
| **NEWS RELEASE** | **Contact:** |
|  | **Transcontinental Realty Investors, Inc. Investor Relations** |
| **FOR IMMEDIATE RELEASE** | **Erik Johnson (469) 522-4200 investor.relations@transconrealty-invest.com** |

---

**Transcontinental Realty Investors, Inc. reports Earnings for Q4 2022**

DALLAS (March 24, 2023) -- Transcontinental Realty Investors, Inc. (NYSE:TCI) is reporting its results of operations for the quarter ended December 31, 2022. For the three months ended December 31, 2022, we reported net income attributable to common shares of $58.9 million or $6.82 per diluted share, compared to a net loss of $8.7 million or $1.01 per diluted share for the same period in 2021.

**Financial Highlights**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• We collected approximately 96% of our rents for the three months ended December 31, 2022, comprised of approximately 97% from multifamily tenants and approximately 96% from office tenants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Total occupancy was 81% at December 31, 2022, which includes 93% at our multifamily properties and 60% at our commercial properties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On November 1, 2022, we received a distribution of approximately $204.0 million in connection the sale of VAA Sale Portfolio earlier in the year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On November 1, 2022, we also received the full control and economical rights to the seven remaining multifamily properties from our Victory Abode Apartments, LLC ("VAA") joint venture (collectively, the "VAA Holdback Portfolio") with a fair value of $219.5 million, which resulted in gain on remeasurement of approximately $73.2 million. The VAA Holdback Portfolio consisted of Blue Lake Villas, Blue Lake Villas Phase II, Northside on Travis, Parc at Denham Springs, Residences at Holland Lake, Villas of Park West I and Villas of Park West II.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On October 21, 2022, we paid off the $38.5 million loan on Stanford Center from the cash generated from sale of the VAA Sale Portfolio.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• On January 31, 2023, we paid off our $66.5 million Series C bonds from cash received from sale of the VAA Sale Portfolio.

**Financial Results**

Rental revenues increased $4.1 million from $7.6 million for the three months ended December 31, 2021 to $11.8 million for the three months ended December 31, 2022. The increase in rental revenue is primarily due to $4.9 million increase at our multifamily properties offset in part by a decrease of $0.7 million from the commercial properties. The increase in revenue from the multifamily properties is primarily due to the acquisition of the VAA Holdback Portfolio in 2022.

------

Net operating income increased $4.6 million from net operating loss of $4.2 million for three months ended December 31, 2021 to net operating income of $0.5 million for the three months ended December 31, 2022. The increase in net operating income is primarily due to the $4.1 million increase in rental revenue as noted above and a decrease of $1.8 million in general administrative and advisory expenses offset in part by an increase of $1.9 million in property operating and depreciation expenses. The decrease in general administrative and advisory expenses is primarily due to a decrease in legal expenses and the increase in property and depreciation expenses is due to the acquisition of the VAA Holdback Portfolio.

Net income attributable to the Company increased $67.7 million from a net loss of $8.7 million for the three months ended December 31, 2021 to net income of $58.9 million for the three months ended December 31, 2022. The increase in net income is primarily attributed to $72.2 million increase in gain on sale, remeasurement or write down of assets offset in part by a $15.1 million increase in our tax provision. The increase in gain on our sale or write down of assets and our tax provision is due to the remeasurement of the VAA Holdback Portfolio that was acquired in 2022.

**About Transcontinental Realty Investors, Inc.**

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

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**TRANSCONTINENTAL REALTY INVESTORS, INC.**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**(Dollars in thousands, except per share amounts)**

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** |
| | **2022** | **2021** | **2022** | **2021** |
| Revenues: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Rental revenues | $11770 | $7625 | $34080 | $37808 |
| &nbsp;&nbsp;&nbsp;Other income | 1014 | 492 | 2580 | 2966 |
| &nbsp;&nbsp;&nbsp; Total revenue | 12784 | 8117 | 36660 | 40774 |
| Expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Property operating expenses | 5798 | 4360 | 18339 | 20860 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 2846 | 2397 | 9686 | 11870 |
| &nbsp;&nbsp;&nbsp;General and administrative | 2595 | 3876 | 9943 | 12425 |
| &nbsp;&nbsp;&nbsp;Advisory fee to related party | 1089 | 1638 | 7974 | 11782 |
| &nbsp;&nbsp;&nbsp; Total operating expenses | 12328 | 12271 | 45942 | 56937 |
| &nbsp;&nbsp;&nbsp; Net operating income (loss) | 456 | (4154) | (9282) | (16163) |
| Interest income | 7938 | 5054 | 26745 | 19572 |
| Interest expense | (5026) | (5504) | (19813) | (24600) |
| Gain (loss) on foreign currency transactions | 630 | (7360) | 20067 | (6175) |
| Loss on early extinguishment of debt |  |  | (2805) | (1451) |
| Equity in (loss) income from unconsolidated joint venture | (2342) | 2996 | 468086 | 14531 |
| Gain on sale, remeasurement or write down of assets, net | 72616 | 382 | 89196 | 23352 |
| Income tax provision | (15085) | (26) | (103190) | 1011 |
| Net income (loss) | 59187 | (8612) | 469004 | 10077 |
| Net income attributable to noncontrolling interest | (239) | (135) | (742) | (679) |
| Net income (loss) attributable to the Company | $58948 | $(8747) | $468262 | $9398 |
| Earnings per share |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | $6.82 | $(1.01) | $54.20 | $1.09 |
| Weighted average common shares used in computing earnings per share |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | 8639316 | 8639316 | 8639316 | 8639316 |

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