Five Point Holdings, LLC Q3 FY2024 earnings call

• Q3 2024 net income was $12.3 million, sixth consecutive quarter of net income.
• Closed two retail land sales in Great Park totaling 12.8 acres for $25.4 million.
• Great Park Venture had $36 million in price and profit participation revenue, $38.9 million in distributions, $10.5 million in incentive compensation, and $3 million in base management fees.
• Great Park partners extended the development management agreement through end-2026 with increased base fee.
• Great Park Venture's legacy interest was satisfied, so 100% of distributions go to percentage interest holders.
• Planned fourth quarter closings at Great Park and Valencia on track.
• Great Park Venture finalizing contracts for 407 home sites to close in H1 2025.
• Considering repurposing commercial sites for residential use in Great Park and Valencia.
• Valencia community has home sales and land sales in progress, with approvals being pursued.
• San Francisco rebalancing process for Candlestick and Shipyard communities is advancing.

In the third quarter of 2024, the Great Park Venture was a key driver. It recognized approximately $36 million in revenue from price and profit participation due to strong housing revenue increases for builders in the Great Park. Five Point received $38.9 million in distributions from the Great Park Venture during the quarter, $10.5 million in incentive compensation, and $3 million in base management fees. Additionally, two retail land sales in the Great Park closed, totaling 12.8 acres for an aggregate purchase price of $25.4 million. The Great Park Venture's revenue contribution is significant, with its operations driving a large portion of the company's financial results.

• If fourth quarter closings go as scheduled, annual net income expected to be between $120 million and $140 million, cash balance between $320 million and $350 million.
• Great Park Venture finalizing contracts for 407 home sites on ~28 acres to close in first half of 2025.
• Began marketing additional residential land in Great Park to close in late 2025.

• Macro factors: Interest rate fluctuations with mixed signals impacting the market.
• California land use approval process challenges leading to chronic undersupply of entitled land.
• Commercial land side of business is more rate sensitive than residential.

Q: Alan Ratner asked about future growth plans, whether within California and with which builders.

A: Dan Hedigan said focus is initially on California, would work with broad spectrum of builders, building on current model with management fees and promote.

Q: Alan Ratner asked about pricing power and land values.

A: Dan Hedigan said California's acute land shortage and entitlement time gives pricing power, land values holding up due to acute land shortage.

Q: Alan Ratner asked about product segmentation demand trends.

A: Dan Hedigan said product remains consistent in family-oriented communities like Great Park and Valencia.

Q: Andrew Acon asked about breaking out San Francisco venture book value and tax basis.

A: Kim Tobler said currently no way to break out Hunters Point from Candlestick easily, tax basis in Valencia benefits the company directly.

Q: Myron Kaplan asked about management agreement renewal importance and impact on operations.

A: Dan Hedigan said management agreement is a good template for future deals, not expected to impact operations directly.

Q: Myron Kaplan asked about Candlestick development.

A: Dan Hedigan said progress is positive with the city and county, rebalancing is moving in a good direction.