STRATUS PROPERTIES is engaged in the acquisition development and sale of commercial and residential real estate properties all of which are located in the state of Texas. Stratus Properties Inc. has a market cap of $39.4 million; its shares were traded at around $5.3 with and P/S ratio of 2.2.
Highlight of Business Operations:The sharp decline in the real estate market, among other factors, significantly impacted our consolidated financial results. In the first quarter of 2009, our revenues totaled $1.5 million and our net loss totaled $1.7 million, compared with revenues of $5.1 million and a net loss of $0.2 million for the first quarter of 2008. Our financial condition and results of operations are highly dependent upon market conditions for real estate activity in Austin, Texas. 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 real estate sales. In turn, these sales will be significantly affected by future real estate market conditions in Austin, Texas, including development costs, interest rate levels, the availability of credit to finance real estate transactions, demand for residential and commercial real estate, and regulatory issues including our land use and development entitlements.
W Austin Hotel & Residences. In 2005, the City selected our proposal to develop a mixed-use project in downtown Austin immediately north of the new City Hall complex. The W Austin Hotel & Residences project includes an entire city block and is planned for a mixture of hotel, residential, retail, office and entertainment uses. In December 2006, we acquired the property for $15.1 million. We have executed agreements with Starwood Hotels & Resorts Worldwide, Inc. for the development of a W Hotel & Residences on the site. In May 2007, we announced our proposed partnership with Canyon-Johnson Urban Fund II, L.P. (Canyon-Johnson) for the development of the W Austin Hotel & Residences project. The grand opening for the onsite sales center was held in conjunction with the groundbreaking ceremony in October 2007. Effective May 1, 2008, we entered into a joint venture with Canyon-Johnson for the development of the project (see Note 5). At March 31, 2009, we had $2.1 million of borrowings outstanding under the W Austin Hotel & Residences project construction loan (see Notes 5 and 12 and “Credit Facility and Other Financing Arrangements” in our discussion of Capital Resources and Liquidity).
Crestview Station. In 2005, we formed a joint venture with Trammell Crow to acquire an approximate 74-acre tract at the intersection of Airport Boulevard and Lamar Boulevard in Austin, Texas, for $7.7 million. The property, known as Crestview Station, is a single-family, multi-family, retail and office development, which is located on the site of a future commuter rail line approved by City of Austin voters. With Trammell Crow, we have completed environmental remediation, which the State of Texas certified as complete in September 2007, and permitting of the property. Infrastructure development of Crestview Station is progressing. The initial phase of utility and roadway infrastructure is under construction and expected to be completed by year-end 2009. Crestview Station sold substantially all of its multi-family and commercial properties in 2007 and one commercial site in the first quarter of 2008. The joint venture retained the single-family component of Crestview Station and two commercial sites. The joint venture is currently processing permits to develop Crestview Station as a 450-unit transit-oriented neighborhood. At March 31, 2009, our investment in the Crestview Station project totaled $2.5 million and the joint venture partnership had $9.2 million of outstanding debt, of which we guarantee $1.9 million (see Notes 7 and 12).
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