Real Estate Activity

9 Months Ended

Sep. 30, 2025

Below is a summary of our real estate as of September 30, 2025 and December 31, 2024:


	September 30, 2025		December 31, 2024
Land	$	104,316	$	104,076
Building and improvements	375,822		375,430
Tenant improvements	20,136		16,629
Construction in progress	198,985		140,046
Total cost	699,259		636,181
Less accumulated depreciation	(87,150)		(78,793)
Total real estate	$	612,109	$	557,388

We incurred depreciation expense of $2,756 and $2,966 for the three months ended September 30, 2025 and 2024, respectively, $8,357 and $8,970 for the nine months ended September 30, 2025 and 2024, respectively.

Construction Activities

Construction in progress consists of the development of Windmill Farms and the costs associated with our ground-up development projects.

Windmill Farms is a collection of freshwater districts ("Districts") in Kaufman County Texas that is being developed into single family lots, multifamily properties and retail properties. In connection with the project, we develop the infrastructure in Windmill Farms in order for the land to appreciate and to sell land units (“lots”) to home builders for construction of single family homes. We receive reimbursement of the infrastructure costs ("District Receivables") through the issuance of municipal bonds by the Districts. As of September 30, 2025, we have $55,657 in District Receivables included in other assets (See Note 10 – Other Assets) and $47,066 of land lot development costs included in construction in progress.

We have entered into several development agreements with Pillar (See Note 12 – Related Party Transactions) to develop multifamily properties. Each of these development projects is being funded in part by a construction loan (See Note 11 – Mortgages and Other Notes Payable).

The following is a summary of construction costs incurred as of September 30, 2025:


Project	Units	Location	Total Project Cost		Costs Incurred		Expected Completion Date
Alera	240	Lake Wales, FL	$	55,330	$	53,292	December 2025
Bandera Ridge	216	Temple, TX	49,603		45,232		November 2025
Merano	216	McKinney, TX	51,910		47,577		November 2025
Mountain Creek	234	Dallas, TX	49,971		5,818		June 2027
	906		$	206,814	$	151,919

Sale of assets

Gain on sale or write-down of assets, net for the three and nine months ended September 30, 2025 and 2024 consists of the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Land (1)	$	755	$	—	$	4,847	$	—


Other	—		—		746		—
Total	$	755	$	—	$	5,593	$	—

(1)Includes the gain on dispositions of land from our investment in Windmill Farms and other land holdings.