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Comstock Holding Companies Reports First Quarter 2019 Results

05/15/2019

WASHINGTON and RESTON, Va., May 15, 2019 (GLOBE NEWSWIRE) -- On May 15, 2019, Comstock Holding Companies, Inc., (NASDAQ: CHCI) (the “Company”), announced results for the three months ended March 31, 2019:

Highlights of First Quarter 2019, as compared to First Quarter 2018:

  • Net income attributable to common stockholders of $0.07 million, or $0.02 per basic and diluted share, as compared to net loss attributable to common stockholders of ($0.72) million in the same period of the prior year, or ($0.21) per basic and diluted share.
  • Revenue from asset management operations of $3.7 million during the first quarter 2019, compared to $2.8 million during the same period of the prior year.
  • Revenue from real estate services of $0.7 million, compared to $0.4 million during the same period of the prior year.
  • Cash flows provided by operating activities increased to $2.9 million during the first quarter 2019, compared to ($0.05) million used in operations during the same period of the prior year.

Highlights associated with the Company’s recently announced balance sheet recapitalization and completion of platform transition:

  • On April 30, 2019 the Company announced it executed a series of transactions that (i) complete the wind-down and divestiture of all liabilities associated with its legacy homebuilding operation, (ii) allow retention by the Company of approximately $18.5 Million of previously invested capital, and (iii) entry into a new  long-term asset management agreement with a market rate fee structure that preserves the financial stability afforded by the cost-plus feature of the previous arrangement while providing the Company with incentive fee participation in the private commercial real estate portfolio (“CRE Portfolio”) controlled by the Company’s Chairman and Chief Executive Officer, Christopher Clemente, which has expanded to now include approximately 7 million square feet of transit-oriented and mixed-use development and stabilized assets.
  • The Company expanded the CRE Portfolio through the addition of a 12-acre property adjacent to its existing Reston Station development, that includes three stabilized Class-A office buildings totaling 408,000 square feet and land entitled for 1.1 million square feet of additional mixed-use development.
  • The Company negotiated the anchor lease with Google for its Trophy-Class office building at the Reston Station development.

“I am pleased to report that we have successfully transitioned away from our homebuilding operating platform into a commercial development and asset management platform with scale and potential to consistently generate positive results” said Comstock’s Chairman and CEO, Christopher Clemente. “Results for the first quarter begin to demonstrate the benefits of the many changes implemented over the past year, including replacement of the initial anchor asset management agreement with a new agreement that we believe significantly enhances Comstock’s earnings potential. With a clean balance sheet, and a reshaped management team of experienced commercial development and asset management professionals, I am confident that our Company is well positioned to generate positive results as we advance development of our portfolio of transit-oriented and mixed use assets, while seeking to continue growing assets under management and expanding our real estate related service offerings”.

About Comstock Holding Companies, Inc.
Comstock Holding Companies, Inc. (“CHCI”) is a multi-faceted real estate development, asset management and real estate related services company that, since 1985, has designed, developed, constructed and managed several thousand residential units and millions of square feet of residential and mixed-use projects throughout the Washington, DC metropolitan market and in other key markets in the southeastern United States. In early 2018, CHCI began transitioning its operating platform from being primarily focused on developing on-balance sheet, for-sale, homebuilding projects to being focused on commercial real estate development, asset management and real estate related services. Anchoring the transition of CHCI is a long-term asset management agreement covering two of the largest transit-oriented, mixed-use developments in the Washington, DC area; Reston Station, a nearly 5 million square foot transit-oriented, mixed-use development located in Reston, VA, and Loudoun Station, a nearly 2.5 million square foot transit-oriented, mixed-use development in Ashburn, VA, as well as other additional development assets. Comstock’s substantial experience in entitling, designing, developing, and managing a diverse range of properties including apartments, single-family homes, townhomes, mid-rise condominiums, high-rise condominiums and mixed-use (residential and commercial) properties, as well as large scale commercial parking garages and infrastructure projects, has positioned the Comstock organization as a premier developer and real estate asset manager in the mid-Atlantic Region. In addition to providing real estate development, asset management, and property management services, CHCI provides development supply chain services, including capital markets, real estate brokerage, environmental consulting and design services in the Washington, DC metropolitan area and in New Jersey and Pennsylvania.

Comstock Holding Companies, Inc. is publicly traded on NASDAQ under the symbol CHCI. For more information, please visit www.ComstockCompanies.com.

About Reston Station
Strategically located mid-way between Tysons Corner and Dulles International Airport, Reston Station is among the largest mixed-use, transit-oriented developments in the Washington, DC area. Located at the terminus of Phase I of Metro’s Silver Line and encompassing nearly 40 acres spanning the Dulles Toll Road and surrounding Reston’s first Metro Station, Reston Station is already home to more than 1,000 residents, numerous businesses, multiple retail establishments, and several popular restaurants. With more than 1 million square feet of completed and stabilized buildings, approximately 4 million square feet of additional development in various stages of entitlement, development and construction, and a 3,500-space underground parking garage and bus transit facility adjacent to the Wiehle Reston-East Metro Station, the Reston Station neighborhood is quickly becoming Fairfax County’s urban focal point in the Dulles Corridor.

For more information about Reston Station, please visit www.RestonStation.com.

About Loudoun Station
Located at the terminus station on Metro’s Silver Line, minutes from Dulles International Airport, Loudoun Station represents Loudoun County’s first (and currently its only) Metro-connected development. Loudoun Station has approximately 700,000 square feet of mixed-use development completed, including hundreds of rental apartments, approximately 150,000 square feet of retail, restaurants, and entertainment venues, 50,000 square feet of Class-A office, and a 1,500-space commuter parking garage. Approximately 2 million square feet of additional development is slated for Loudoun Station. Located adjacent to Metro’s Ashburn Station, the Loudoun Station neighborhood represents Loudoun County’s beginning transformation into a transit connected community with direct connectivity to Dulles International Airport, Reston, Tysons Corner and downtown Washington, DC. As Loudoun County’s only transit connected neighborhood, Loudoun Station has become the new downtown of Loudoun County in the Dulles Corridor.

For more information about Loudoun Station, please visit www.LoudounStation.com.

Cautionary Statement Regarding Forward-Looking Statements
This release may include "forward-looking" statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by use of words such as "anticipate," "believe," "estimate," "may," "intend," "expect," "will," "should," "seeks" or other similar expressions. Forward-looking statements are based largely on our expectations and involve inherent risks and uncertainties, many of which are beyond our control. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements. Additional information concerning important risk factors and uncertainties can be found under the heading "Risk Factors" in our latest Annual Report on Form 10-K, as filed with the Securities and Exchange Commission. Comstock specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.

Company:
Comstock Holding Companies, Inc.
Christopher Guthrie, 703-230-1292
Chief Financial Officer

Source: Comstock Holding Companies, Inc.


COMSTOCK HOLDING COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share data)

    March   31,
2019
    December   31,
2018
 
    (unaudited)          
ASSETS                
Cash and cash equivalents   $ 5,755     $ 5,780  
Restricted cash     1,138       1,231  
Trade receivables     1,434       1,329  
Trade receivables - related parties     1,290       2,950  
Real estate inventories     17,598       20,253  
Fixed assets, net     205       221  
Goodwill     1,702       1,702  
Intangible assets, net     153       170  
Lease right-of-use assets     156        
Other assets, net     1,490       1,464  
TOTAL ASSETS   $ 30,921     $ 35,100  
                 
LIABILITIES AND STOCKHOLDERS EQUITY                
Accounts payable and accrued liabilities   $ 6,803     $ 7,614  
Deferred revenue     1,250       1,875  
Notes payable - secured by real estate inventories, net of deferred financing
  charges
    10,033       13,432  
Notes payable - due to affiliates, unsecured, net of discount     4,935       4,903  
Notes payable - unsecured, net of deferred financing charges     595       595  
Lease liabilities     156        
Income taxes payable     54       51  
TOTAL LIABILITIES     23,826       28,470  
                 
Commitments and contingencies (Note 14)                
STOCKHOLDERS’ EQUITY (DEFICIT)                
Series C preferred stock $0.01 par value, 20,000,000 and 3,000,000 shares authorized,
  2,799,848 issued and outstanding and liquidation preference of $13,999, at
  March 31, 2019 and December 31, 2018, respectively
  $ 7,193     $ 7,193  
Class A common stock, $0.01 par value, 59,779,750 and 11,038,071 shares
authorized, 3,749,413 and 3,703,5113 issued, and 3,663,843 and 3,617,943
outstanding at March 31, 2019 and December 31, 2018, respectively
    37       37  
Class B common stock, $0.01 par value, 220,250 shares authorized,
  issued and outstanding at March 31, 2019 and December 31, 2018
    2       2  
Additional paid-in capital     180,769       180,673  
Treasury stock, at cost (85,570 shares Class A common stock)     (2,662 )     (2,662 )
Accumulated deficit     (194,250 )     (194,319 )
TOTAL COMSTOCK HOLDING COMPANIES, INC. DEFICIT     (8,911 )     (9,076 )
Non-controlling interests     16,006       15,706  
TOTAL EQUITY     7,095       6,630  
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY   $ 30,921     $ 35,100  


COMSTOCK HOLDING COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)

    Three Months Ended March   31,  
    2019     2018  
Revenues                
Revenue—homebuilding   $ 6,978     $ 5,561  
Revenue—asset management     3,652       2,791  
Revenue—real estate services     728       447  
Total revenue     11,358       8,799  
Expenses                
Cost of sales—homebuilding, excluding impairment charges     6,722       5,495  
Cost of sales—asset management     3,317       2,541  
Cost of sales—real estate services     494       177  
Impairment charges           558  
Sales and marketing     114       219  
General and administrative     305       360  
Interest and real estate taxes     34       85  
Operating income (loss)     372       (636 )
Other income, net           14  
Income (loss) before income tax expense     372       (622 )
Income tax expense     3       6  
Net Income (loss)     369       (628 )
Net income attributable to non-controlling interests     300       95  
Net income (loss) attributable to common stockholders     69       (723 )
                 
Basic net income (loss) per share   $ 0.02     $ (0.21 )
Diluted net income (loss) per share   $ 0.02     $ (0.21 )
                 
Basic weighted average shares outstanding     3,850       3,448  
Diluted weighted average shares outstanding     3,965       3,448  

Comstock logo

Source: Comstock Holding Companies, Inc.

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