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Item 8. Financial Statements and Supplementary Data

2026-03-06 compared with 2025-02-24 · 376 added, 307 removed, 953 unchanged (42% of the section changed)

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Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Five Point Holdings, LLC and subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), capital, and cash flows, for each of the three years in the period ended December 31, 2024, and the related notes and schedule III—real estate and accumulated depreciation (collectively referred to as the “financial statements”).

We have audited the accompanying consolidated balance sheets of Five Point Holdings, LLC and subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, capital, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes and schedule III—real estate and accumulated depreciation (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 21, 2025, expressed an unqualified opinion on the Company’s internal control over financial reporting.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 6, 2026, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

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Costa Mesa, California

February 21, 2025

March 6, 2026

We have served as the Company’s auditor since 2009.

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29,264 29,487

INTANGIBLE ASSET, NET—RELATED PARTY

INTANGIBLE ASSETS, NET—RELATED PARTY 17,250 9,037

GOODWILL 69,812 —

CASH AND CASH EQUIVALENTS

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20,264 20,952

$ 3,249,003 $ 3,076,417

LIABILITIES AND CAPITAL

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Deferred income tax liability, net

58,343 33,570

Payable pursuant to tax receivable agreement

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COMMITMENTS AND CONTINGENT LIABILITIES (Note 14)

REDEEMABLE NONCONTROLLING INTEREST

25,000 25,000

REDEEMABLE NONCONTROLLING INTERESTS 70,155 25,000

Class A common shares;

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60,617 51,233 51,495

Restructuring — — 19,437

Total costs and expenses

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17,254 10,858 7,230

Loss on debt extinguishment ( 1,819 ) — —

Miscellaneous

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EQUITY IN EARNINGS FROM UNCONSOLIDATED ENTITIES 203,592 132,617 76,595

INCOME (LOSS) BEFORE INCOME TAX (PROVISION) BENEFIT 205,096 109,298 ( 36,245 )

INCOME BEFORE INCOME TAX (PROVISION) BENEFIT 212,459 205,096 109,298

INCOME TAX (PROVISION) BENEFIT ( 28,925 ) ( 27,462 ) 4,418

NET INCOME (LOSS) 177,634 113,716 ( 34,774 )

LESS NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS 109,337 58,322 ( 19,371 )

NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY $ 68,297 $ 55,394 $ ( 15,403 )

NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS A SHARE

NET INCOME 183,534 177,634 113,716

LESS NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS 112,568 109,337 58,322

NET INCOME ATTRIBUTABLE TO THE COMPANY $ 70,966 $ 68,297 $ 55,394

NET INCOME ATTRIBUTABLE TO THE COMPANY PER CLASS A SHARE

$ 1.01 $ 0.98 $ 0.80

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149,299,535 146,944,944 145,131,125

NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY PER CLASS B SHARE

NET INCOME ATTRIBUTABLE TO THE COMPANY PER CLASS B SHARE

Basic and diluted

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FIVE POINT HOLDINGS, LLC

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

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2025 2024 2023

NET INCOME (LOSS) $ 177,634 $ 113,716 $ ( 34,774 )

OTHER COMPREHENSIVE INCOME (LOSS):

Net actuarial gain (loss) on defined benefit pension plan 1,720 889 ( 1,929 )

Reclassification of actuarial loss on defined benefit pension plan included in net income (loss) 198 162 255

Other comprehensive income (loss) before taxes 1,918 1,051 ( 1,674 )

INCOME TAX PROVISION RELATED TO OTHER COMPREHENSIVE INCOME (LOSS) ( 336 ) — —

OTHER COMPREHENSIVE INCOME (LOSS)—Net of tax 1,582 1,051 ( 1,674 )

COMPREHENSIVE INCOME (LOSS) 179,216 114,767 ( 36,448 )

LESS COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS 110,053 58,715 ( 19,998 )

COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY $ 69,163 $ 56,052 $ ( 16,450 )

NET INCOME $ 183,534 $ 177,634 $ 113,716

OTHER COMPREHENSIVE (LOSS) INCOME:

Net actuarial (loss) gain on defined benefit pension plan ( 138 ) 1,720 889

Reclassification of actuarial loss on defined benefit pension plan included in net income 59 198 162

Other comprehensive (loss) income before taxes ( 79 ) 1,918 1,051

INCOME TAX BENEFIT (PROVISION) RELATED TO OTHER COMPREHENSIVE (LOSS) INCOME 15 ( 336 ) —

OTHER COMPREHENSIVE (LOSS) INCOME—Net of tax ( 64 ) 1,582 1,051

COMPREHENSIVE INCOME 183,470 179,216 114,767

LESS COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS 112,541 110,053 58,715

COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY $ 70,929 $ 69,163 $ 56,052

See accompanying notes to consolidated financial statements.

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BALANCE - January 1, 2023 69,068,354 79,233,544 $ 587,733 $ 33,386 $ ( 2,988 ) $ 618,131 $ 1,249,916 $ 1,868,047

Net loss — — — ( 15,403 ) — ( 15,403 ) ( 19,371 ) ( 34,774 )

Net income — — — 55,394 — 55,394 58,322 113,716

Share-based compensation — — 3,665 — — 3,665 — 3,665

Reacquisition of share-based compensation awards for tax-withholding purposes ( 83,660 ) — ( 202 ) — — ( 202 ) — ( 202 )

Forfeitures of share-based compensation awards, net of issuances ( 621,482 ) — — — — — — —

Other comprehensive loss—net of tax of $ 0 -actuarial loss on pension plan

Issuance of share-based compensation awards, net of forfeitures 215,244 — — — — — — —

Other comprehensive income—net of tax of $ 0 -actuarial gain on pension plan

— — — — 658 658 393 1,051

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Net income — — — 68,297 — 68,297 109,337 177,634

Share-based compensation — — 3,665 — — 3,665 — 3,665

Share-based compensation—net of tax of $ 1,865

— — 2,434 — — 2,434 — 2,434

Reacquisition of share-based compensation awards for tax-withholding purposes ( 282,883 ) — ( 823 ) — — ( 823 ) — ( 823 )

Issuance of share-based compensation awards, net of forfeitures 215,244 — — — — — — —

Issuance of share-based compensation awards 169,670 — — — — — — —

Settlement of restricted share units for Class A common shares 282,509 — — — — — — —

Other comprehensive income—net of tax of $ 336 -actuarial gain on pension plan

— — — — 866 866 716 1,582

Tax distribution to noncontrolling interest — — — — — — ( 4,033 ) ( 4,033 )

Tax distributions to noncontrolling interests — — — — — — ( 7,679 ) ( 7,679 )

Adjustment to liability recognized under tax receivable agreement—net of tax of $ 60

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Net income (1)

— — — 70,966 — 70,966 111,256 182,222

Share-based compensation—net of tax of $ 680

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Settlement of restricted share units for Class A common shares 918,020 — — — — — — —

Other comprehensive income—net of tax of $ 336 -actuarial gain on pension plan

Other comprehensive loss—net of tax of $ 15 -actuarial loss on pension plan

— — — — ( 37 ) ( 37 ) ( 27 ) ( 64 )

Redemption of noncontrolling interest—net of tax of $ 5,476

1,110,113 ( 3,137,134 ) 20,496 — ( 40 ) 20,456 ( 25,932 ) ( 5,476 )

Tax distributions to noncontrolling interests

— — — — — — ( 12,608 ) ( 12,608 )

Adjustment to liability recognized under tax receivable agreement—net of tax of $ 2,272

— — ( 5,847 ) — — ( 5,847 ) — ( 5,847 )

Adjustment of noncontrolling interest in the Operating Company — — 765 — ( 2 ) 763 ( 763 ) —

Adjustment of noncontrolling interest in the Operating Company—net of tax of $ 817

— — 2,341 — ( 4 ) 2,337 ( 3,154 ) ( 817 )

BALANCE - December 31, 2025 71,100,768 76,096,410 $ 616,751 $ 228,043 $ ( 1,549 ) $ 843,245 $ 1,475,196 $ 2,318,441

(1) Total net income excludes net income of $ 1.3 million attributable to redeemable noncontrolling interests (see Note 6).

See accompanying notes to consolidated financial statements.

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CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss) $ 177,634 $ 113,716 $ ( 34,774 )

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Net income $ 183,534 $ 177,634 $ 113,716

Adjustments to reconcile net income to net cash provided by operating activities:

Equity in earnings from unconsolidated entities ( 203,592 ) ( 132,617 ) ( 76,595 )

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Return on investment from Gateway Commercial Venture 1,446 9,433 —

Return on investment from other equity method investments 609 — —

Deferred income taxes

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7,611 4,299 3,665

Loss on debt extinguishment 1,819 — —

Changes in operating assets and liabilities:

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7,676 ( 14,777 ) ( 10,730 )

Net cash provided by (used in) operating activities 115,986 154,123 ( 188,302 )

Net cash provided by operating activities 105,230 115,986 154,123

CASH FLOWS FROM INVESTING ACTIVITIES:

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Return of investment from Gateway Commercial Venture 151 7,752 —

Return of investment from Valencia Landbank Venture 980 1,148 3,305

Contribution to Valencia Landbank Venture — — ( 205 )

Return of investment from other equity method investments 4,633 980 1,148

Contributions to unconsolidated entities ( 6,506 ) — —

Acquisition of Hearthstone Venture, net of cash acquired ( 55,307 ) — —

Purchase of properties and equipment

( 217 ) ( 808 ) ( 23 )

Net cash provided by investing activities 70,064 77,111 63,990

Net cash (used in) provided by investing activities ( 6,552 ) 70,064 77,111

CASH FLOWS FROM FINANCING ACTIVITIES:

Reacquisition of share-based compensation awards for tax-withholding purposes

( 823 ) ( 202 ) ( 2,736 )

Proceeds from senior notes offering 450,000 — —

Repayments of notes payable ( 530,121 ) ( 100,000 ) —

Payment of financing costs

( 8,522 ) ( 474 ) ( 687 )

Reacquisition of share-based compensation awards for tax-withholding purposes

( 2,357 ) ( 823 ) ( 202 )

Related party reimbursement obligation

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Tax distributions to noncontrolling interests ( 12,608 ) ( 7,679 ) ( 4,033 )

Repayments of notes payable ( 100,000 ) — —

Borrowings under revolving credit facility — — 15,000

Repayments under revolving credit facility — — ( 15,000 )

Distributions to redeemable noncontrolling interests ( 399 ) — —

Net cash used in financing activities ( 104,007 ) ( 108,976 ) ( 9,204 )

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH 77,074 222,030 ( 134,029 )

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH ( 5,329 ) 77,074 222,030

CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH—Beginning of period

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Five Point Holdings, LLC, a Delaware limited liability company (the “Holding Company” and, together with its consolidated subsidiaries, the “Company”), is an owner and developer of mixed-use planned communities in California.

The Company also provides capital solutions to the U.S.

homebuilding industry primarily through the management of land banks.

The Holding Company owns all of its assets and conducts all of its operations through Five Point Operating Company, LP, a Delaware limited partnership (the “Operating Company”), and its subsidiaries.

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Holders of Class A common shares and holders of Class B common shares are entitled to one vote for each share held of record on all matters submitted to a vote of shareholders, and are both entitled to receive distributions at the same time.

However, the distributions paid to holders of our Class B common shares are in an amount per share equal to 0.0003 multiplied by the amount paid per Class A common share.

Noncontrolling interests represent equity interests in the Company’s consolidated subsidiaries held by partners in the Operating Company, excluding the Holding Company, and members in The Shipyard Communities, LLC (the “San Francisco Venture”), excluding the Operating Company (see Note 5).

However, the distributions paid to holders of Class B common shares are in an amount per share equal to 0.0003 multiplied by the amount paid per Class A common share.

The Company presents noncontrolling interests on the Company’s consolidated balance sheet and classifies such interests within capital but separate from the Company’s Class A and Class B members’ capital or outside of capital when the criteria for temporary capital classification have been met.

Noncontrolling interests represent equity interests in the Company’s consolidated subsidiaries held by partners in the Operating Company, excluding the Holding Company, members in The Shipyard Communities, LLC (the “San Francisco Venture”), excluding the Operating Company, and members in Hearthstone Residential Holdings, LLC (“HRH”) or its subsidiaries (HRH, together with its consolidated subsidiaries, the “Hearthstone Venture”), excluding the Operating Company (see Note 6).

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation —The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

Reclassification of prior period amounts —During the year ended December 31, 2025, the Company combined certain line items in which the Company determined separate disclosure within the notes to the financial statements was not meaningful to the users of the financial statements.

These presentation changes did not affect the total capital balance, net income or earnings per share in any of the periods reported.

Principles of consolidation —The accompanying consolidated financial statements include the accounts of the Company and the accounts of all subsidiaries in which the Company has a controlling financial interest and the accounts of variable interest entities (“VIEs”) in which the Company is deemed to be the primary beneficiary.

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The Company’s risk management policies define parameters of acceptable market risk and strive to limit exposure to credit risk.

Noncontrolling interests —The Company presents noncontrolling interests and classifies such interests within capital but separate from the Company’s Class A and Class B members’ capital when the criteria for permanent equity classification has been met.

Net income (loss) attributable to the noncontrolling interests on the consolidated statement of operations represents the portion of

earnings attributable to the economic interest in the Company’s subsidiaries held by the noncontrolling interests.

Net income (loss) attributable to the noncontrolling interests on the consolidated statement of operations represents the portion of earnings attributable to the economic interest in the Company’s subsidiaries held by the noncontrolling interests.

The Company allocates income (loss) to noncontrolling interests based on the substantive profit sharing provisions of the applicable subsidiary operating agreements.

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The transfer of control typically occurs when title passes at the close of escrow and the customer is able to direct the use of, control and obtain substantially all of the benefits from the land.

The transaction price typically contains fixed and variable components in which the fixed consideration represents the stated purchase price for the land and the gross proceeds received at the time of closing.

The transaction price typically contains fixed consideration that represents the stated purchase price for the land and the gross proceeds received at the time of closing.

Some of the Company’s residential homesite sale agreements contain a profit participation provision, a variable form of consideration, whereby the Company receives from homebuilders a portion of profit after the builder has received an agreed-upon margin.

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In most contracts, at the time of the land sale, the estimate of profit participation, if any, is constrained, as there are significant factors outside of the Company’s control that will impact whether participation thresholds will be met.

In addition, some residential homesite sale agreements contain a provision requiring the homebuilder to pay a marketing fee per residence sold, as a percentage of the home sale price.

Such marketing fees are estimated as a variable form of consideration and the amount the Company expects to be entitled to receive from the homebuilder is recognized as revenue at the time of land sale.

In addition, some residential homesite sale agreements contain a price participation provision requiring the homebuilder to pay a fee per residence sold, as a percentage of the home sale price.

Such fees are estimated as a variable form of consideration and the amount the Company expects to be entitled to receive from the homebuilder is recognized as revenue at the time of land sale.

Since payment for variable consideration is received in future periods, but the Company has completed its performance obligation, a contract asset is recorded for contingent variable consideration, if any, included in the transaction price.

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In some cases, the Company may be obligated to perform post-closing development obligations on the sold land and as a result may defer a portion of the transaction price.

Management Services — related party —Revenues from management services are recognized as the customer consumes the benefits of the performance obligation satisfied over time.

Management Services — related party —Revenues from development management services and asset management services are recognized as the customer consumes the benefits of the performance obligation satisfied over time.

The transaction price pertaining to management services revenue may be comprised of fixed and variable components.

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In making estimates of incentive compensation the Company is entitled to receive in exchange for providing management services, significant assumptions and judgments are made in evaluating the factors that may determine the amount of consideration the Company will ultimately receive.

Cash flow projections of the project being developed are utilized in making such estimates.

These cash flows are significantly affected by estimates and assumptions related to market supply and demand, the local economy, projected pace of sales of homesites, projected pricing over the estimated selling period, the length of the estimated development and selling periods, remaining development, general and administrative costs, the contract period, and other factors.

The Company includes in the transaction price an estimate of incentive compensation only to the extent that a significant reversal of revenue is not probable.

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A contract asset is recognized when there is a timing difference between recognition of revenue upon satisfaction of performance obligations and revenues becoming billable.

In some of its development management agreements, the Company previously received compensation equal to the actual general and administrative costs incurred by the Company as it performed services.

In these circumstances, the Company acts as the principal and recognizes management fee revenues on these reimbursements in the same period that these costs are incurred because the amount to which the Company has the right to invoice corresponds directly with the value consumed by the customer for the Company’s performance to date.

Operating properties —Included in operating properties revenues in the consolidated statements of operations are revenues from the Company’s agriculture, energy and other miscellaneous operations.

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Agriculture and other leasing revenue is recognized in accordance with applicable lease accounting guidance.

Impairment of assets —Long-lived assets, including inventory and the Company’s intangible asset, are reviewed for impairment when events or changes in circumstances indicate that the carrying value of an asset group may not be recoverable.

Impairment of assets —Long-lived assets, including inventory and the Company’s intangible assets, are reviewed for impairment when events or changes in circumstances indicate that the carrying value of an asset group may not be recoverable.

Impairment indicators for long-lived inventory assets include, but are not limited to, significant increases in horizontal development costs, significant decreases in the pace and pricing of home sales within the Company’s communities and surrounding areas, political and societal events that may negatively affect the local economy, and changes in development strategies that would result in acceleration of the realization of the value of such assets.

If indicators of impairment exist, and the undiscounted cash flows expected

to be generated by a long-lived asset are less than its carrying amount, an impairment charge is recorded to write down the carrying amount of such long-lived asset to its estimated fair value.

If indicators of impairment exist, and the undiscounted cash flows expected to be generated by a long-lived asset are less than its carrying amount, an impairment charge is recorded to write down the carrying

amount of such long-lived asset to its estimated fair value.

The Company may estimate the fair value of its long-lived assets using a discounted cash flow model or sales comparison approach of the underlying property or a combination thereof.

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During the years ended December 31, 2025, 2024 and 2023, the Company did not recognize any impairment losses on its long-lived assets.

Business Combinations —The Company accounts for businesses it acquires in accordance with Accounting Standards Codification (“ASC”) Topic 805, Business Combinations .

This methodology requires that assets acquired, liabilities assumed and noncontrolling interests of the acquiree be recorded at fair value on the date of acquisition.

Goodwill is recorded with regard to acquisitions of businesses when the purchase price of the business plus the fair value of noncontrolling interests of the acquiree exceeds the value of the identifiable assets acquired and liabilities assumed.

The costs of business acquisitions are expensed as incurred.

These costs may include fees for accounting, legal, professional consulting and valuation specialists.

Purchase price allocations may be preliminary, and during the measurement period, not to exceed one year from the date of acquisition, changes in assumptions and estimates that result in adjustments to the fair value of assets acquired and liabilities assumed are recorded in the period the adjustments are determined.

Goodwill —The Company's goodwill balance resulted from the acquisition of the Hearthstone Venture in July 2025.

In accordance with ASC 350, Intangibles-Goodwill and Other , the Company evaluates goodwill for potential impairment at least annually during the fourth quarter or more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable.

The Company may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount.

Qualitative factors may include, but are not limited to, economic conditions, industry and market considerations, cost factors, overall financial performance of the reporting unit and other entity and reporting unit specific events.

If a quantitative assessment is performed, the fair value estimate may be derived through various valuation methods, including the use of discounted expected future cash flows.

The annual goodwill impairment analysis was performed as of October 1, 2025, and the Company did not recognize any impairment losses on its goodwill.

Share-based payments —Share-based payments are recognized on a straight-line basis over the service period in the statement of operations based on measurement date fair values.

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Investments in unconsolidated entities —For investments in entities that the Company does not control, but exercises significant influence, the Company uses the equity method of accounting.

The Company’s judgment with regard to its level of influence or control of an entity involves consideration of various factors including the form of its ownership interest, its representation in the entity’s governance, its ability to participate in policy-making decisions, and the rights of other investors to participate in the decision-making process to replace the Company as manager or to liquidate the entity.

participate in the decision-making process to replace the Company as manager or to liquidate the entity.

Investments accounted for under the equity method of accounting are recorded at cost and adjusted for the Company’s share in the earnings (losses) of the venture, impairments and cash contributions and distributions.

Any difference between the carrying amount of the equity method investment on the Company’s balance sheet and the underlying equity in net assets on the investee’s balance sheet results in a basis difference which is adjusted as the related underlying assets are depreciated, amortized, or sold and the liabilities are settled.

The Company’s interests in Heritage Fields LLC (the “Great Park Venture”), Five Point Office Venture Holdings I, LLC (the “Gateway Commercial Venture”) and FP-HS Lot Option Joint Venture - Valencia, LLC (the “Valencia Landbank Venture”) were accounted for using the equity method for all years presented in the accompanying consolidated financial statements.

The Company’s interests in Heritage Fields LLC (the “Great Park Venture”), Five Point Office Venture Holdings I, LLC (the “Gateway Commercial Venture”), FP-HS Lot Option Joint Venture - Valencia, LLC (the “Valencia Landbank Venture”) and the Hearthstone Venture funds (the “Hearthstone Funds”) were accounted for using the equity method for all years presented in the accompanying consolidated financial statements.

The Company eliminates a portion of intra-entity profits resulting from land sales between the Company and its unconsolidated entities until the assets are sold to a third-party.

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The Company evaluates its investments in unconsolidated entities for other-than-temporary impairment by reviewing each investment for any indicators of impairment, including the fair value of such investments compared to their carrying amounts.

The Company estimates the fair value of its investments by discounting the cash flows from distributions the Company expects to receive

from the venture.

The Company estimates the fair value of its investments by discounting the cash flows from distributions the Company expects to receive from the venture.

Significant input assumptions used in estimating the distributions the Company expects to receive from the venture include revenue appreciation rates and cost inflation rates.

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Since this method requires the Company to estimate future development costs and the expected sales price for future land sales, the profit margin on subsequent parcels sold will be affected by both changes in the estimated total revenues, as well as any changes in the estimated total cost of the project.

Intangible Asset —The Company records intangible asset amortization expense over the contract period based on the pattern in which the Company expects to recognize the economic benefits from the intangible asset.

Intangible Assets —The Company records intangible asset amortization expense straight-line over the useful life or over the contract period based on the pattern in which the Company expects to recognize the economic benefits from the intangible asset.

Receivables —The Company evaluates the carrying value of receivables, which includes receivables from related parties, at each reporting date to determine the need for an allowance for expected credit losses.

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The Company has elected the practical expedient to not separate lease and nonlease components for both lessee and lessor arrangements.

For operating leases with an expected term greater than one year in which the Company is the lessee, operating right of use (“ROU”) assets and operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term.

For operating leases with an

expected term greater than one year in which the Company is the lessee, operating right of use (“ROU”) assets and operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term.

When the rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments.

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federal, state, and local tax purposes and determines the provision or benefit for income taxes on an interim basis using an estimate of its annual effective tax rate and the impact of specific events as they occur.

The Company’s estimate of the Holding Company’s annual effective tax rate is subject to change based on changes in federal and state tax laws and regulations, the Holding Company’s ownership interest in the Operating Company and the Operating Company’s ownership in the San Francisco Venture, and the Company’s assessment of any required deferred tax asset valuation allowance.

The Company’s estimate of the Holding Company’s annual effective tax rate is subject to change based on changes in federal and state tax laws and regulations, the Holding Company’s ownership interest in the Operating Company and the Operating Company’s ownership in the San Francisco Venture and other less than wholly owned subsidiaries, and the Company’s assessment of any required deferred tax asset valuation allowance.

Cumulative adjustments are made in interim periods in which the Company identifies a change in its estimate of the amount of future tax benefit when it is more likely than not that some portion of the deferred tax assets will not be realized.

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The Holding Company recognizes interest or penalties related to income tax matters in income tax expense.

Restructuring —Restructuring costs consist of one-time employee-related termination benefits and other postemployment compensation arrangements.

On February 9, 2022, Daniel Hedigan was appointed as the Company’s Chief Executive Officer.

Preceding Mr.

Hedigan’s appointment, Emile Haddad stepped down from his roles as Chairman, Chief Executive Officer and President effective as of September 30, 2021 and transitioned into a senior advisory role pursuant to an advisory agreement with an initial three-year term.

Haddad remains a member of the Company’s Board of Directors serving as Chairman Emeritus.

Concurrent with Mr.

Hedigan’s appointment, Lynn Jochim transitioned from her position as President and Chief Operating Officer into an advisory role pursuant to a three-year advisory agreement (see Note 9).

Upon the appointment of Mr.

Hedigan as the Company’s Chief Executive Officer, the Company accrued a related party liability of $ 15.6 million attributed to advisory agreement payments due to Mr.

Haddad and Ms.

In addition, the Company determined the service condition associated with Mr.

Haddad and Ms.

Jochim’s unvested restricted share awards had been modified (see Note 16).

As a result of this modification, the Company recognized approximately $ 3.0 million in share-based compensation expense as a restructuring cost during the year ended December 31, 2022.

In addition to the Company’s executive management restructuring activities, the Company incurred and paid $ 0.9 million in restructuring costs resulting from severance benefits incurred in March 2022.

Miscellaneous other (expense) income —Miscellaneous other (expense) income consisted of the following (in thousands):

Miscellaneous other income (expense) —Miscellaneous other income (expense) consisted of the following (in thousands):

Year Ended December 31,

2025 2024 2023

Net periodic pension (cost) benefit $ ( 49 ) $ ( 82 ) $ 245

Net periodic pension benefit (cost) $ 67 $ ( 49 ) $ ( 82 )

753 ( 5,928 ) ( 694 )

Total miscellaneous other (expense) income $ ( 5,977 ) $ ( 776 ) $ 245

Total miscellaneous other income (expense) $ 820 $ ( 5,977 ) $ ( 776 )

(1) In January 2024, the Company settled an exchange offer on its $ 625.0 million 7.875 % Senior Notes (see Note 11).

For the years ended December 31, 2024 and 2023, the Company incurred $ 5.9 million and $ 1.8 million, respectively, in third party costs related to the debt modification, which is included in other in the table above.

Recently adopted and issued accounting pronouncements —In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which primarily requires expanded disclosure of significant segment expenses and other segment

items on an interim and annual basis.

The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company has adopted this standard for the current year consolidated financial statements and has applied this standard retrospectively for all prior periods presented in the consolidated financial statements (see Note 15).

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , which primarily requires expanded disclosures for income taxes paid and the effective tax rate reconciliation.

Recently adopted and issued accounting pronouncements —In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , which primarily requires expanded disclosures for income taxes paid

and the effective tax rate reconciliation.

The standard is effective for fiscal years beginning after December 15, 2024, with early adoption permitted and can be applied on either a prospective or retrospective basis.

The Company is currently evaluating the effect of this update on the Company’s financial statement disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

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The Company is currently evaluating the effect of this update on the Company’s financial statement disclosures.

On July 31, 2025 (the “Acquisition Date”), the Company acquired substantially all of the assets associated with the residential asset management business of Hearthstone, Inc., a provider of capital solutions to the U.S.

homebuilding industry, by purchasing 75 % of the outstanding Class A units of HRH for an all cash purchase price of $ 57.6 million.

This acquisition positions the Company as an active manager of capital solutions for the homebuilding industry primarily through land banking.

The acquisition was accounted for as a business combination under ASC Topic 805, Business Combinations (“ASC 805”).

The following table summarizes the amounts recognized for the estimated fair value of the assets acquired, liabilities assumed and noncontrolling interests of the Hearthstone Venture and resulting goodwill as of the Acquisition Date (in thousands):

Consideration $ 57,562

Recognized amounts of identifiable assets acquired and liabilities assumed

Cash and cash equivalents 2,255

Related party receivables and contract assets 10,653

Investment in funds 16,508

Intangible assets 13,672

Other assets 1,113

Total assets 44,201

Accounts payable and other liabilities 12,209

Total liabilities 12,209

Net identifiable assets acquired 31,992

Goodwill 69,812

Net assets acquired 101,804

redeemable noncontrolling interests in the Hearthstone Venture 44,242

A third-party valuation specialist assisted the Company in estimating the fair values of the assets acquired, liabilities assumed and noncontrolling interests in the Hearthstone Venture.

The identifiable intangible assets acquired include investor relationships and joint venture projects, which were valued at $ 7.3 million and $ 6.4 million, respectively.

The fair values of these intangible assets were determined using income-based valuation approaches, specifically the multi-period excess earnings method.

The investor relationships intangible asset was valued based on projected revenue growth and estimated attrition rates of existing investors, while the joint venture projects intangible asset was valued based on projected net revenue from existing joint venture contracts.

The estimated remaining useful lives of both intangible assets are seven years .

The fair value of the noncontrolling interests (see Note 6) was based on the stated unit values, which the Company determined approximated fair value, and discounted cash flow analyses.

These fair value measurements are based on significant inputs that are not observable in the market and thus represent a fair value measurement categorized within Level 3 of the fair value hierarchy.

Key assumptions include discount rates consistent with expected returns on comparable private real estate funds ranging from 15 % to 20 %.

Goodwill primarily represents the value of expected operational synergies, enhanced scale and market presence, the assembled workforce, and other intangible benefits expected to be realized from integrating the Hearthstone Venture platform with the Company’s existing operations.

The Company expects $ 39.8 million, the portion of goodwill attributable to its ownership interest, will be deductible for tax purposes.

All of the goodwill was assigned to the Hearthstone segment.

At December 31, 2025, the carrying value of goodwill was $ 69.8 million.

During the year ended December 31, 2025, the Company incurred $ 1.6 million in acquisition costs.

The acquisition costs are included in selling, general, and administrative expenses on the accompanying consolidated statement of operations.

Revenues and earnings of the Hearthstone Venture included in the Company’s consolidated statements of operations from the Acquisition Date through December 31, 2025, were $ 11.8 million and $ 3.9 million, respectively.

Unaudited Pro Forma

The following table presents the Company’s unaudited pro forma consolidated revenues and net income for the years ended December 31, 2025 and 2024 as if the Hearthstone Venture acquisition had occurred on January 1, 2024 (in thousands):

Year Ended December 31,

Revenues $ 120,844 $ 254,255

Net income 187,362 179,419

These amounts have been calculated after applying the Company's accounting policies, including acquisition costs in the earnings of the earliest period and adjusting the results of the Hearthstone Venture to reflect amortization for intangible assets and tax effects.

The following tables present the Company’s consolidated revenues disaggregated by revenue source and reporting segment (see Note 16) (in thousands):

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Valencia San Francisco Great Park (1)

Unallocated Total

Hearthstone (2)

Land sales and land sales—related party

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(1) The tables above do not include revenues of the Great Park Venture, which are included in the Company’s reporting segment totals (see Notes 5 and 16).

(2) Hearthstone revenues are for the period from the Acquisition Date through December 31, 2025.

The Company, through Five Point Communities, LP (“FP LP”), and Five Point Communities Management, Inc., (“FP Inc.” and together with FP LP, the “Management Company”), has a development management agreement, as amended and restated (“A&R DMA”), with the Great Park Venture.

The A&R DMA had an original term commencing on December 29, 2010 and ending on December 31, 2021 (the “Initial Term”).

In addition to an annual fixed base fee and variable cost reimbursements, the Initial Term of the A&R DMA included incentive compensation that becomes payable in connection with and as a percentage of distributions made to the members of the Great Park Venture, including distributions made in periods after the Initial Term.

Consideration in the form of

contingent incentive compensation from the A&R DMA was recognized as revenue and a contract asset as services were provided over the contract term.

In addition to an annual fixed base fee, the Initial Term of the A&R DMA included incentive compensation that becomes payable in connection with and as a percentage of distributions made to the members of the Great Park Venture, including distributions made in periods after the Initial Term.

Consideration in the form of contingent incentive compensation from the A&R DMA was recognized as revenue and a contract asset as services were provided over the contract term.

By mutual agreement, the Initial Term had been extended through December 31, 2022 (the “2022 Extension”).

The 2022 Extension resulted in the elimination of variable cost reimbursements and an increase in the annual fixed base fee to $ 12.0 million for 2022.

The 2022 Extension did not change the incentive compensation provisions of the A&R DMA applicable to the Initial Term.

In December 2022, the Company and the Great Park Venture entered into a second amendment to the A&R DMA establishing the terms of service through December 31, 2024 (the “First Renewal Term”).

The compensation payable to the Company during the First Renewal Term remained unchanged from the 2022 Extension and included the annual fixed base fee and incentive compensation payments.

The compensation payable to the Company during the First Renewal Term included an annual fixed base fee and incentive compensation payments payable as a percentage of distributions made to the members of the Great Park Venture during the First Renewal Term.

In September 2024, the Company and the Great Park Venture entered into a third amendment to the A&R DMA.

Under the third amendment, the term of the A&R DMA has been renewed through December 31, 2026 (the “Second Renewal Term”).

The compensation payable to the Company during the Second Renewal Term includes a $ 13.5 million annual fixed base fee beginning in 2025, which reflects an increase from the current $ 12.0 million annual fixed base fee under the First Renewal Term, and incentive compensation payments.

The incentive compensation provisions of the A&R DMA were not changed pursuant to the third amendment.

Due to the contingencies associated with estimating the amount of incentive compensation that ultimately will become payable for services provided through the Initial Term, the Company has constrained, under the guidance of ASC Topic 606, its estimate of incentive compensation revenues such that the Company believes that a significant reversal of revenues is not probable of occurring.

The compensation payable to the Company during the Second Renewal Term includes a $ 13.5 million annual fixed base fee beginning in 2025, which reflects an increase from the $ 12.0 million annual fixed base fee under the First Renewal Term, and incentive compensation payments payable as a percentage of distributions made to the members of the Great Park Venture during the Second Renewal Term.

Due to the contingencies associated with estimating the amount of incentive compensation that ultimately will become payable for services provided, the Company has constrained, under the guidance of ASC Topic 606, its estimate of incentive compensation revenues such that the Company believes that a significant reversal of revenues is not probable of occurring.

As the contingencies are resolved in future periods, the Company may record adjustments to revenue to reflect changes in the Company’s estimate of incentive compensation expected to be received.

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These cash flows are significantly affected by estimates and assumptions related to market supply and demand, the local economy, projected pace of sales of homesites, projected pricing over the estimated selling period, the length of the estimated development and selling periods, remaining development, general, and administrative costs, the contract period, and other factors.

The Hearthstone Venture generates asset management fee revenues, primarily from the management of land banking funds.

Asset management services are satisfied over time because the customer receives and consumes the benefits of the management services daily.

Base fee consideration is variable since over the contract period the management fee varies based on fluctuations in the basis of the calculation.

The basis of the calculation is the amount of invested capital, or a similar measurement, multiplied by a defined fee rate.

The base management fee is generally calculated and payable monthly allowing any uncertainty about the amount of the fee to be resolved and the full amount of the fee to be recognized as revenue during the reporting period.

Any uncollected fees are recognized as a receivable and included in related party assets on the consolidated balance sheet.

The Hearthstone Venture's asset management contracts may also contain a performance fee payable upon a managed fund achieving a defined rate of return to the customer.

Performance fees are recognized as management services are provided over the service period estimated to be needed to reach the performance threshold.

Performance fees are constrained and only recognized to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved.

When performance fees are recognized in advance of payments due, a contract asset is recognized and is included in related party assets on the consolidated balance sheet.

Contract balances are recorded on the consolidated balance sheet in either related party assets or other assets for receivables from customers and contract assets (unbilled receivables) depending on whether the customer is a related party.

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The opening and closing balances of the Company’s contract assets for the year ended December 31, 2025 were $ 101.8 million ($ 100.8 million related party, see Note 10) and $ 89.7 million ($ 87.5 million related party, see Note 10), respectively.

The net increase of $ 29.7 million between the opening and closing balances of the Company’s contract assets primarily resulted from additional incentive compensation revenue recognized during the period that resulted from changes in the estimated constrained transaction price of the A&R DMA partially offset by the receipt of $ 50.9 million in incentive compensation payments from the Great Park Venture and the receipt of marketing fees from homebuilders from prior period land sales.

The net decrease of $ 12.1 million between the opening and closing balances of the Company’s contract assets primarily resulted from the receipt of $ 62.8 million in incentive compensation payments from the Great Park Venture partially offset by (i) additional incentive compensation revenue recognized during the period that resulted from changes in the estimated constrained transaction price of the A&R DMA and (ii) $ 10.4 million primarily for performance fees recognized as part of the Hearthstone Venture’s acquisition (see Note 3).

The Company received an additional $ 5.1 million in incentive compensation payments from the Great Park Venture related to

the Second Renewal Term during the year ended December 31, 2025.

The balance represents a contract liability for payments received prior to the satisfaction of the associated performance obligation and is included in related party liabilities as of December 31, 2025.

The opening and closing balances of the Company’s contract assets for the year ended December 31, 2024 were $ 72.1 million ($ 69.1 million related party, see Note 10) and $ 101.8 million ($ 100.8 million related party, see Note 10), respectively.

The net decrease of $ 14.4 million between the opening and closing balances of the Company’s contract assets primarily resulted from additional incentive compensation revenue recognized during the period that resulted from changes in the estimated constrained transaction price of the A&R DMA offset by the receipt of $ 46.5 million in incentive compensation payments from the Great Park Venture and the receipt of marketing fees from prior period land sales.

The opening and closing balances of the Company’s other receivables from contracts with customers and contract liabilities for the years ended December 31, 2024 and 2023 were insignificant.

Other than the incentive compensation contract liability, the opening and closing balances of the Company’s other receivables from contracts with customers and contract liabilities for the years ended December 31, 2025 and 2024 were insignificant.

The Company applies the disclosure exemptions associated with remaining performance obligations for contracts with an original expected term of one year or less, contracts for which revenue is recognized in proportion to the amount of services performed and variable consideration that is allocated to wholly unsatisfied performance obligations for services that form part of a series of services.

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The Great Park Venture previously had two classes of membership interests—“Percentage Interests” and “Legacy Interests.” The Operating Company owned 37.5 % of the Great Park Venture’s Percentage Interests as of December 31, 2025.

Legacy Interest holders were entitled to receive priority distributions in an aggregate amount equal to $ 476.0 million, which were satisfied as of December 31, 2021, and up to an additional $ 89.0 million from participation in subsequent distributions of cash depending on the performance of the Great Park Venture.

During the year ended December 31, 2024, the Great Park Venture made aggregate distributions of $ 18.1 million to holders of Legacy Interests and $ 485.1 million to holders of Percentage Interests.

Legacy Interest holders were entitled to receive priority distributions in an aggregate amount equal to $ 565.0 million, all of which had been distributed as of December 31, 2024, as a result of which, the Legacy Interests are no longer deemed to be outstanding.

During the year ended December 31, 2025, the Great Park Venture made aggregate distributions of $ 672.0 million to holders of Percentage Interests.

The Company received $ 252.0 million for its 37.5 % Percentage Interest.

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The Company received $ 181.9 million for its 37.5 % Percentage Interest.

With the distributions to the holders of Legacy Interests during the year ended December 31, 2024, the Great Park Venture fully satisfied the $ 89.0 million maximum participating Legacy Interest distribution rights, as a result of which, the Legacy Interests are no longer deemed to be outstanding.

The Great Park Venture is the owner of Great Park Neighborhoods, a mixed-use planned community located in Orange County, California.

The Company, through the A&R DMA, as amended, manages the planning, development and sale of the Great Park Neighborhoods and supervises the day-to-day affairs of the Great Park Venture.

The Great Park Venture is governed by an executive committee of representatives appointed by only the holders of Percentage Interests.

The Great Park Venture is governed by an executive committee of representatives appointed by the holders of Percentage Interests.

The Company serves as the administrative member but does not control the actions of the executive committee.

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The Company’s earnings or losses from the equity method investment are adjusted by amortization and accretion of the basis differences as the assets (mainly inventory) and liabilities that gave rise to the basis difference are sold, settled or amortized.

During the year ended December 31, 2025, the Great Park Venture recognized no land sale revenues to related parties of the Company and $ 825.7 million in land sale revenues to third parties, of which $ 224.9 million relates to homesites sold to an unaffiliated land banking entity whereby Lennar retained the option to acquire these homesites in the future from the land bank entity.

During the year ended December 31, 2024, the Great Park Venture recognized $ 22.6 million in land sale revenues to related parties of the Company and $ 590.2 million in land sale revenues to third parties.

During the year ended December 31, 2023, the Great Park Venture recognized $ 16.2 million in land sale revenues to related parties of the Company and $ 538.6 million in land sale revenues to third parties, of which $ 357.8 million relates to homesites sold to an unaffiliated land banking entity whereby Lennar retained the option to acquire these homesites in the future from the land bank entity.

During the year ended December 31, 2022, the Great Park Venture recognized $ 12.5 million in land sale revenues to related parties of the Company and $ 270.9 million in land sale revenues to third parties.

The following table summarizes the statements of operations of the Great Park Venture for the years ended December 31, 2025, 2024 and 2023 (in thousands):

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Land sale and related party land sale revenues $ 825,659 $ 612,806 $ 554,825

Home sale revenues — — 40,475

Cost of land sales ( 195,900 ) ( 144,876 ) ( 237,309 )

( 144,876 ) ( 237,148 ) ( 155,692 )

Cost of home sales — ( 161 ) ( 29,692 )

Other costs and expenses

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$ 175,935 $ 282,277

Redeemable Legacy Interests

Capital (Percentage Interest)

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$ 100,953 $ 151,647

At each reporting period, and when events and circumstances dictate, the Company evaluates its equity method investment in the Great Park Venture for impairment.

This evaluation focuses on the recoverability of the carrying value based upon the discounted value of distributions the Company expects to receive from the Great Park Venture.

This evaluation is performed at the investment level and is separate and apart from impairment evaluations on long-lived assets, such as the Company’s consolidated inventory balances, that focus on recoverability with undiscounted cash flows.

The Company evaluates the investment as a whole and does not evaluate the underlying assets of the Great Park Venture for impairment.

If the Great Park Venture records an impairment charge against its assets, the Company will recognize its share of the loss, adjusted for basis differences.

During the years ended December 31, 2024, 2023 and 2022, the Great Park Venture did not recognize any impairment losses on its long-lived assets.

Gateway Commercial Venture

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After retiring the Gateway Commercial Venture’s outstanding debt, the Gateway Commercial Venture made distributions to its members, of which the Company received $ 17.2 million.

The Company and a subsidiary of Lennar Corporation separately leased portions of the building that was under the ownership of the Gateway Commercial Venture, and during the years ended December 31, 2024, 2023 and 2022, the Gateway Commercial Venture recognized $ 8.7 million, $ 8.5 million and $ 8.4 million, respectively, in rental revenues from those leasing arrangements.

During the year ended December 31, 2025, the Company received $ 1.6 million in distributions from the Gateway Commercial Venture.

The Company and a subsidiary of Lennar Corporation separately leased portions of the building that was under the ownership of the Gateway Commercial Venture, and during the years ended December 31, 2024 and 2023, the Gateway Commercial Venture recognized $ 8.7 million and $ 8.5 million, respectively, in rental revenues from those leasing arrangements.

The following table summarizes the statements of operations of the Gateway Commercial Venture for the years ended December 31, 2025, 2024 and 2023 (in thousands):

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Gain on sale of assets, net — 17,826 —

Interest income 2,219 — —

Interest expense — ( 2,590 ) ( 2,531 )

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The following table summarizes the balance sheet data of the Gateway Commercial Venture and the Company’s investment balance as of December 31, 2025 and 2024 (in thousands):

Real estate and related intangible assets, net $ — $ 76,719

Cash and restricted cash $ 41 $ 257

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Total assets $ 43,722 $ 43,924

Notes payable, net $ — $ 28,850

Other liabilities, net — 6,623

Members’ capital $ 43,722 $ 43,924

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The Company’s investment in the Gateway Commercial Venture $ 32,792 $ 32,943

Valencia Landbank Venture

As of December 31, 2024, the Company owned a 10 % interest in the Valencia Landbank Venture, an entity organized in December 2020 for the purpose of taking assignment from homebuilders of purchase and sale agreements for the purchase of residential lots within the Company’s Valencia community.

The Valencia Landbank Venture concurrently enters into option and development agreements with homebuilders pursuant to which the homebuilders retain the option to purchase the land to construct and sell homes.

The Company does not have a controlling financial interest in the Valencia Landbank Venture, however, the Company has the ability to significantly influence the Valencia Landbank Venture’s operating and financial policies, and most major decisions require the Company’s approval in addition to the approval of the Valencia Landbank Venture’s other unaffiliated member, and therefore the Company accounts for its investment in the Valencia Landbank Venture using the equity method.

When the Company sells land to the Valencia Landbank Venture, it eliminates its pro-rata share of the intra-entity profits generated from the sale through earnings (loss) from unconsolidated entities until the land is sold by the Valencia Landbank Venture to third-party homebuilders.

At December 31, 2024 and 2023, the Company’s investment in the Valencia Landbank Venture was $ 0.7 million and $ 1.2 million, respectively.

During the years ended December 31, 2024, 2023 and 2022, the Company recognized equity in earnings of $ 0.5 million, $ 0.6 million and $ 1.2 million, respectively, from the Valencia Landbank Venture.

Hearthstone Funds

The Hearthstone Venture has ownership interests in individual funds that primarily engage in land banking.

The Hearthstone Venture is the general partner or managing member of each fund and holds an economic interest between 1 % and 3 %.

The Hearthstone Funds make investments in separate project limited partnerships that acquire land to be developed and contract with preapproved homebuilders through option and development agreements to construct improvements and purchase lots on agreed-upon terms and conditions.

The Hearthstone Venture does not have a controlling financial interest in any of the Hearthstone Funds, however, the Hearthstone Venture has the ability to significantly influence the operating and financial policies of the Hearthstone Funds, and therefore it accounts for its investments in the funds using the equity method.

Several of the Hearthstone Funds utilize financing arrangements to partially fund the acquisition of land.

The debt is non-recourse to the Hearthstone Venture other than in the case of customary “bad act” exceptions or bankruptcy or insolvency events.

The following table summarizes the statements of operations of the Hearthstone Funds from the Acquisition Date through December 31, 2025 (in thousands):

Total revenues $ 468,036

Total expenses ( 447,933 )

Total net income $ 20,103

Equity in earnings from the Hearthstone Funds $ 397

The following table summarizes the balance sheet data of the Hearthstone Funds as of December 31, 2025 (in thousands):

Total assets $ 3,328,424

Total liabilities $ 1,613,133

The Company’s investment in the Hearthstone Funds $ 18,923

NONCONTROLLING INTERESTS

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The Holding Company’s wholly owned subsidiary is the managing general partner of the Operating Company, and at December 31, 2025, the Holding Company and its wholly owned subsidiary owned approximately 65.0 % of the outstanding Class A Common Units and 100 % of the outstanding Class B Common Units of the Operating Company.

The Holding Company consolidates the financial results of the Operating Company and its subsidiaries and records a noncontrolling interest for the remaining 37.4 % of the outstanding Class A Common Units of the Operating Company that are owned separately by affiliates of Lennar Corporation (“Lennar”), GFFP Holdings, LLC (“GFFP”), which in October 2024 acquired all of the interests previously owned by affiliates of Castlelake, L.P.

(“Castlelake”), and an entity controlled by Emile Haddad, the Company’s Chairman Emeritus of the Board of Directors and former Chief Executive Officer (the “Management Partner”).

The Holding Company consolidates

the financial results of the Operating Company and its subsidiaries and records a noncontrolling interest for the remaining 35.0 % of the outstanding Class A Common Units of the Operating Company that are owned separately by affiliates of Lennar Corporation (“Lennar”) and GFFP Holdings, LLC (“GFFP”).

After a 12 month holding period, holders of Class A Common Units of the Operating Company may exchange their units for, at the Company’s option, either (i) Class A common shares on a one -for-one basis (subject to adjustment in the event of share splits, distributions of shares, warrants or share rights, specified extraordinary distributions and similar events), or (ii) cash in an amount equal to the market value of such shares at the time of exchange.

In either situation, an equal number of that holder’s Class B common shares will automatically convert into Class A common shares, at a ratio of 0.0003 Class A common shares for each Class B common share.

Other than GFFP, which is subject to the 12 month holding period, this exchange right is currently exercisable by all holders of outstanding Class A Common Units of the Operating Company.

This exchange right is currently exercisable by all holders of outstanding Class A Common Units of the Operating Company.

With each exchange of Class A Common Units of the Operating Company for Class A common shares, the Holding Company’s percentage ownership interest in the Operating Company and its share of the Operating Company’s cash distributions and profits and losses will increase.

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Such equity transactions result in an adjustment between members’ capital and the noncontrolling interest in the Company’s consolidated balance sheet and statement of capital to account for the changes in the noncontrolling interest ownership percentage as well as any change in total net assets of the Company.

During the years ended December 31, 2024, 2023 and 2022, the Holding Company’s ownership interest in the Operating Company changed as a result of net equity transactions related to the Company’s share-based compensation plan.

The terms of the Operating Company’s Limited Partnership Agreement (“LPA”) provide for the payment of tax distributions to the Operating Company’s partners in an amount equal to the estimated income tax liabilities resulting from taxable income or gain allocated to those parties.

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Total tax distributions $ 12,608 $ 7,679 $ 4,033

Generally, tax distributions are treated as advance distributions under the LPA and are taken into account when determining the amounts otherwise distributable under the LPA.

Generally, tax distributions are treated as advance distributions under the LPA and are taken into account when determining the amounts otherwise distributable or as an adjustment to the shares issuable upon an exchange of Class A Common Units under the LPA.

An entity controlled by Emile Haddad, the Company’s Chairman Emeritus of the Board of Directors and former Chief Executive Officer (the “Management Partner”) previously owned 3,137,134 Class A Common Units of the Operating Company.

On October 13, 2025, the Management Partner exchanged 3,137,134 Class A Common Units of the Operating Company, and in exchange therefor, received 1,109,172 Class A common shares of the Holding Company.

The remaining 2,027,962 Class A Common Units owned by the Management Partner were returned to the Operating Company in accordance with the tax distribution dilution provisions of the LPA and were canceled.

During the years ended December 31, 2025, 2024 and 2023, the Holding Company’s ownership interest in the Operating Company also changed as a result of net equity transactions related to the Company’s share-based compensation plan.

The San Francisco Venture

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The Operating Company acquired a controlling interest in the San Francisco Venture in the May 2016 Formation Transactions by acquiring all of the outstanding Class B units of the San Francisco Venture.

All of the outstanding Class A units are owned by Lennar and GFFP, which in October 2024 acquired all of the interests previously owned by Castlelake.

All of the outstanding Class A units are owned by Lennar and GFFP.

The Class A units of the San Francisco Venture are intended to be substantially economically equivalent to the Class A Common Units of the Operating Company.

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Holders of Class A units of the San Francisco Venture can redeem their units at any time and receive Class A Common Units of the Operating Company on a one -for-one basis (subject to adjustment in the event of share splits, distributions of shares, warrants or share rights, specified extraordinary distributions and similar events).

If a holder requests a redemption of Class A units of the San Francisco Venture that would result in the Holding Company’s ownership of the Operating Company falling below 50.1 %, the

Holding Company has the option of satisfying the redemption with Class A common shares instead.

If a holder requests a redemption of Class A units of the San Francisco Venture that would result in the Holding Company’s ownership of the Operating Company falling below 50.1 %, the Holding Company has the option of satisfying the redemption with Class A common shares instead.

The Company also has the option, at any time, to acquire outstanding Class A units of the San Francisco Venture in exchange for Class A Common Units of the Operating Company.

The 12 month holding period for any Class A Common Units of the Operating Company issued in exchange for Class A units of the San Francisco Venture is calculated by including the period that such Class A units of the San Francisco Venture were owned.

Other than GFFP who is subject to the 12 month holding period, this exchange right is currently exercisable by all holders of outstanding Class A units of the San Francisco Venture.

Redeemable Noncontrolling Interest

The 12 month holding period for any Class A Common Units of the Operating Company issued in exchange for

Class A units of the San Francisco Venture is calculated by including the period that such Class A units of the San Francisco Venture were owned.

This exchange right is currently exercisable by all holders of outstanding Class A units of the San Francisco Venture.

Redeemable Noncontrolling Interest (San Francisco Class C units)

In 2019, the San Francisco Venture issued 25.0 million Class C units to an affiliate of Lennar in exchange for a contribution of $ 25.0 million to the San Francisco Venture.

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In connection with the issuance of the Class C units, the San Francisco Venture agreed to spend $ 25.0 million on the development of infrastructure and/or parking facilities at the Company’s Candlestick development.

At each of December 31, 2024 and 2023, $ 25.0 million of Class C units were outstanding and included in redeemable noncontrolling interest on the consolidated balance sheets.

At each of December 31, 2025 and 2024, $ 25.0 million of Class C units were outstanding and included in redeemable noncontrolling interests on the consolidated balance sheets.

Redeemable Noncontrolling Interest (Hearthstone Venture)

Interests in the Hearthstone Venture include Class A units and Class B units of HRH.

The Class A units represent common equity interests that participate in profits and losses proportionately, while the Class B units represent a separate class of nonvoting preferred interests.

The Class B units have a stated value of $ 1,000 per unit and accrue a preferred return at a rate equal to 10 % per annum or less, as defined in HRH’s operating agreement.

The Class B interests are entitled to receive distributions of unpaid preferred return and capital prior to any distributions to the Class A Unit members.

At December 31, 2025, the Company held 75 % of the outstanding Class A units.

Other members of HRH held the remaining 25 % of the outstanding Class A units and 10,472 Class B units representing 100 % of the outstanding Class B units.

In the event HRH calls capital, the portion attributable to the Class A units held by the other members will be satisfied by automatic conversion of Class B units into Class A units at a value of $ 1,000 per Class B Unit, until all Class B units are fully converted.

The Class A units and Class B units held by other members of HRH are redeemable at the option of the Company or the other members after July 31, 2031, and upon the occurrence of certain events prior to July 31, 2031.

The redemption value of the Class A units will be fair market value as of the redemption date, while the redemption value of Class B units will be equal to $ 1,000 per unit plus any unpaid preferred return.

Class A units and Class B units held by other members are included in redeemable noncontrolling interests on the consolidated balance sheets.

The redeemable noncontrolling interests are measured at the greater of carrying amount or redemption value at each reporting date.

HRH consolidates subsidiary asset management entities (collectively, the “Hearthstone Professional Entities”).

Each of the Hearthstone Professional Entities is governed by a limited liability company agreement under which HRH serves as managing member, and legacy members hold minority ownership interests.

The legacy members are entitled to receive distributions of profits and fees generated from legacy investment and management activities, including certain promote fees, in accordance with the terms of their respective operating agreements.

These distribution rights are limited to historical projects and diminish over time as the related investments in those projects are realized or liquidated.

The legacy member interests will be fully redeemed once all distributions and allocations to which they are entitled have been made.

The legacy member interests are included in redeemable noncontrolling interests on the consolidated balance sheets.

The carrying amount of the Hearthstone Venture redeemable noncontrolling interests as of July 31, 2025, the Acquisition Date, and December 31, 2025 were as follows (in thousands):

HRH Class A Unit Noncontrolling Interests HRH Class B Unit Noncontrolling Interests Hearthstone Professional Entities Noncontrolling Interests Total Hearthstone Venture Redeemable Noncontrolling Interests

BALANCE - July 31, 2025 $ 19,188 $ 12,072 $ 12,982 $ 44,242

Hearthstone Venture net income allocation 857 455 — 1,312

Class B unit conversions 1,600 ( 1,600 ) — —

Distributions and redemptions — ( 188 ) ( 211 ) ( 399 )

BALANCE - December 31, 2025 $ 21,645 $ 10,739 $ 12,771 $ 45,155

CONSOLIDATED VARIABLE INTEREST ENTITY

The Holding Company conducts all of its operations through the Operating Company, a consolidated VIE, and as a result, substantially all of the Company’s assets and liabilities represent the assets and liabilities of the Operating Company, other than items attributed to income taxes and the payable pursuant to tax receivable agreement (“TRA”).

The Operating Company has investments in and consolidates the assets and liabilities of the San Francisco Venture, FP LP and Five Point Land, LLC (“FPL”), the entity developing Valencia, all of which have also been determined to be VIEs.

attributed to income taxes and the payable pursuant to tax receivable agreement (“TRA”).

The Operating Company has investments in and consolidates the assets and liabilities of the San Francisco Venture, FP LP, Five Point Land, LLC (“FPL”), the entity developing Valencia, and the Hearthstone Professional Entities, all of which have also been determined to be VIEs.

The San Francisco Venture is a VIE as the other members of the venture, individually or as a group, are not able to exercise kick-out rights or substantive participating rights.

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In addition, the San Francisco Venture is only allowed to make a capital call on the Operating Company and not any other interest holders, which could be a significant financial risk to the Operating Company.

As of December 31, 2024, the San Francisco Venture had total combined assets of $ 1.42 billion, primarily comprised of $ 1.42 billion of inventories and $ 0.9 million in related party assets, and total combined liabilities of $ 68.4 million, including $ 62.1 million in related party liabilities.

As of December 31, 2025, the San Francisco Venture had total combined assets of $ 1.48 billion, primarily comprised of $ 1.48 billion of inventories, and total combined liabilities of $ 68.8 million, including $ 64.7 million in related party liabilities.

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As of December 31, 2024, FP LP and FPL had combined assets of $ 1.0 billion, primarily comprised of $ 876.2 million of inventories, $ 9.0 million of intangibles and $ 100.8 million in related party assets, and total combined liabilities of $ 62.0 million, including $ 61.1 million in accounts payable and other liabilities and $ 0.8 million in related party liabilities.

The Hearthstone Professional Entities are VIEs, as the other members of such entities, either individually or as a group, are not able to exercise kick-out rights and do not hold substantive participating rights.

HRH is the primary beneficiary of the Hearthstone Professional Entities, and as of December 31, 2025, the total combined assets of the Hearthstone Professional Entities were $ 33.0 million, primarily comprised of investments in the Hearthstone Funds, and total combined liabilities were $ 0.3 million.

The Company evaluates its primary beneficiary designation on an ongoing basis and assesses the appropriateness of the VIE’s status when events have occurred that would trigger such an analysis.

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Depreciation expense was $ 0.3 million, $ 0.3 million and $ 1.0 million for the years ended December 31, 2025, 2024 and 2023, respectively.

INTANGIBLE ASSET, NET—RELATED PARTY

The intangible asset relates to the contract value of the incentive compensation provisions of the A&R DMA with the Great Park Venture acquired in the Formation Transactions (see Note 9).

The intangible asset will be amortized over the contract period based on the pattern in which the economic benefits are expected to be received.

The carrying amount and accumulated amortization of the intangible asset as of December 31, 2024 and 2023 were as follows (in thousands):

Gross carrying amount $ 129,705 $ 129,705

Accumulated amortization ( 120,668 ) ( 104,435 )

Net book value $ 9,037 $ 25,270

INTANGIBLE ASSETS, NET—RELATED PARTY

Intangible assets consist of (i) the contract value of the incentive compensation provisions of the A&R DMA with the Great Park Venture acquired in the Formation Transactions (see Note 10) and (ii) identifiable intangible assets acquired in connection with the acquisition of the Hearthstone Venture (see Note 3).

The intangible assets acquired through the Hearthstone Venture acquisition include (i) investor relationships representing established relationships with institutional investors and capital partners that are expected to contribute recurring fee revenues and (ii) joint venture projects representing contractual rights to earn management and performance fees from existing residential financing and development arrangements.

The incentive compensation intangible asset will be amortized over the contract period based on the pattern in which the economic benefits are expected to be received, while the Hearthstone Venture intangible assets will be amortized on a straight-line basis over an estimated useful life of seven years .

The carrying amount and accumulated amortization of the intangible assets as of December 31, 2025 and 2024 were as follows (in thousands):

Gross carrying amount Accumulated amortization Net book value Gross carrying amount Accumulated amortization Net book value

Hearthstone intangible assets $ 13,672 $ ( 814 ) $ 12,858 $ — $ — $ —

Great Park A&R DMA incentive compensation 129,705 ( 125,313 ) 4,392 129,705 ( 120,668 ) 9,037

$ 143,377 $ ( 126,127 ) $ 17,250 $ 129,705 $ ( 120,668 ) $ 9,037

Intangible asset amortization expense, as a result of revenue recognition attributable to incentive compensation, was $ 4.6 million, $ 16.2 million and $ 15.0 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Amortization expense is included in the cost of management services in the accompanying consolidated statements of operations and is included in the Great Park segment.

Intangible asset amortization expense for the Hearthstone Venture intangible assets was $ 0.8 million for the year ended December 31, 2025.

Amortization expense is included in the cost of management services in the accompanying consolidated statement of operations and is included in the Hearthstone segment.

RELATED PARTY TRANSACTIONS

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$ 89,509 $ 101,670

Operating lease right-of-use asset (see Note 12) — 14,040

$ 101,670 $ 83,970

Related Party Liabilities:

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$ 64,736 $ 62,057

Payable to holders of Management Company’s Class B interests

Operating lease liability (see Note 12) — 10,974

Accrued advisory fees 125 4,725

$ 70,973 $ 63,297

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In 2010, the Great Park Venture, the Company’s equity method investee, engaged the Management Company under a development management agreement to provide management services to the Great Park Venture.

The initial term of the development management agreement with the Great Park Venture expired on December 31, 2021 but had been extended by mutual agreement of the parties through December 31, 2022.

The compensation structure in place consisted of a base fee and incentive compensation.

Incentive compensation is characterized as “Legacy Incentive Compensation” and “Non-Legacy Incentive Compensation.” Legacy Incentive Compensation consists of a maximum of $ 9.0 million of incentive compensation payments attributed to contingent payments made under a cash flow participation agreement to which the Great Park Venture is a party.

Holders of the Management Company’s Class B interests are entitled to receive distributions from the Management Company that are attributable to any Legacy Incentive Compensation received by the Management Company.

Non-Legacy Incentive Compensation is 9 % of distributions available to be made by the Great Park Venture to holders of Percentage Interests of the Great Park Venture during the Initial Term (see Note 4).

In December 2022, the Company and the Great Park Venture extended the A&R DMA through the First Renewal Term.

The compensation payable to the Company during the First Renewal Term continued to include a base fee and incentive compensation payments.

In September 2024, the Company and the Great Park Venture further extended the A&R DMA through the Second Renewal Term.

The compensation payable to the Company during the Second Renewal Term includes a revised annual fixed base fee beginning in 2025 and incentive compensation payments.

The incentive compensation provisions of the A&R DMA remain unchanged through the Second Renewal Term.

In September 2024, the Company and the Great Park Venture extended the A&R DMA through December 31, 2026.

The compensation structure in place consists of a base fee and incentive compensation.

Incentive compensation is 9 % of distributions available to be made by the Great Park Venture to its Percentage Interests holders (see Note 5).

If the A&R DMA is not extended by mutual agreement of the parties beyond December 31, 2026 and the Company is no longer providing management services subsequent to December 31, 2026, the Company will continue to be entitled to 6.75 % of distributions paid thereafter.

During the year ended December 31, 2024, the Great Park Venture made Legacy Incentive Compensation payments to the Company of $ 1.8 million and Non-Legacy Incentive Compensation payments of $ 49.1 million.

Upon receiving the Legacy Incentive Compensation payments, the Company distributed the $ 1.8 million in proceeds to the holders of the Management Company’s Class B interests.

During the year ended December 31, 2023, the Great Park Venture made Legacy Incentive Compensation payments to the Company of $ 4.9 million and Non-Legacy Incentive Compensation payments of $ 41.6 million.

Upon receiving the Legacy Incentive Compensation payments, the Company distributed the $ 4.9 million in proceeds to the holders of the Management Company’s Class B interests.

During the years ended December 31, 2025 and 2024, the Great Park Venture made incentive compensation payments of $ 68.0 million and $ 49.1 million, respectively, to the Company.

Additionally, during the year ended December 31, 2024, the Company received $ 1.8 million in incentive compensation payments attributed to Legacy Interests which were distributed to the holders of the Management Company’s Class B interests.

As of December 31, 2024, the holders of the Management Company’s Class B interests had no further distribution rights.

For the years ended December 31, 2025, 2024 and 2023, the Company recognized revenue from management services of $ 53.5 million, $ 96.0 million and $ 47.2 million, respectively, related to all management fees under the A&R DMA, and such revenues are included in management services—related party in the accompanying consolidated statements of operations and are included in the Great Park segment.

At December 31, 2024 and 2023, included in contract assets in the table above is $ 99.2 million and $ 66.1 million, respectively, attributed to incentive compensation revenue recognized but not yet due (see Note 3).

Operating Lease Right-of-Use Asset and Operating Lease Liability

In December 2024, the Gateway Commercial Venture, the Company’s equity method investee, sold its remaining interests in the Five Point Gateway Campus (See Note 4).

The Company leases corporate office space in the building previously owned by the

Gateway Commercial Venture at the Five Point Gateway Campus (See Note 12).

Upon completion of the asset sale, the Company’s lease agreement for the corporate office space at the Five Point Gateway Campus continued with the third party buyer.

At December 31, 2025 and 2024, included in contract assets in the table above is $ 76.3 million and $ 99.2 million, respectively, attributed to incentive compensation revenue recognized but not yet due, and at December 31, 2025, included in other related party liabilities is $ 5.1 million attributed to payments received for incentive compensation revenue not yet recognized (see Note 4).

Reimbursement Obligation

Prior to the Company’s acquisition of the San Francisco Venture, the San Francisco Venture completed a separation transaction (the “Separation Transaction”) pursuant to an Amended and Restated Separation and Distribution Agreement (“Separation Agreement”) in which the equity interests in a subsidiary of the San Francisco Venture known as CPHP Development, LLC (“CPHP”) were distributed directly to the Class A members of the San Francisco Venture:

(i) an affiliate of Lennar and (ii) an affiliate of Castlelake.

The San Francisco Venture has entered into reimbursement agreements for which it has agreed to reimburse CPHP or its subsidiaries for a portion of the EB-5 loan liabilities and related interest that were assumed by CPHP or its subsidiaries pursuant to the Separation Agreement.

Interest totaled $ 2.7 million, $ 2.7 million and $ 3.0 million for the years ended December 31, 2024, 2023 and 2022, respectively.

The San Francisco Venture has entered into reimbursement agreements for which it has agreed to reimburse an affiliate of Lennar for a portion of the EB-5 loan liabilities and related interest that were assumed by an affiliate of Lennar in connection with the Formation Transactions.

Interest totaled $ 2.7 million for each of the years ended December 31, 2025, 2024 and 2023.

All of the incurred interest for the years ended December 31, 2025, 2024 and 2023 was capitalized into inventories.

The weighted average interest rate as of December 31, 2025 was 4.6 %.

Pursuant to a reimbursement deferral agreement, principal and interest payments under the related party reimbursement obligation are deferred through March 31, 2025.

Additionally, throughout 2024, the Company was notified by CPHP or its affiliates that certain payments that were previously expected to be paid by CPHP or its affiliates in 2024 had been deferred to 2025 and 2026.

These deferred amounts continue to incur interest at the original interest rate.

Principal payments of $ 57.5 million and $ 1.2 million are expected to be paid in 2025 and 2026, respectively, however, additional deferral notices may further extend the expected payment dates.

Employment Transition Agreement and Advisory Agreement with Emile Haddad

On August 23, 2021, the Company and the Company’s then Chairman, Chief Executive Officer and President, Emile Haddad, entered into an employment transition agreement pursuant to which, effective as of September 30, 2021, Mr.

Haddad stepped down from his roles as Chairman, Chief Executive Officer and President.

Haddad remained a member of the Company’s Board of Directors serving as Chairman Emeritus.

Concurrently, the Company also entered into an advisory agreement with Mr.

Haddad for an initial term of three years , which became effective on October 1, 2021 and expired on September 30, 2024.

Haddad received an annual retainer of $ 5.0 million, and his unvested equity awards continued to vest in accordance with their terms, subject to continued service as an advisor or member of the Company’s Board of Directors.

At December 31, 2023, included in accrued advisory fees in the table above is $ 3.6 million attributed to the initial term of Mr.

Haddad’s advisory agreement (see Note 2).

In December 2024, the Company and Mr.

Haddad entered into a first amendment to the advisory agreement.

Under the first amendment, the advisory agreement has been extended for a term of four years from December 1, 2024 through December 1, 2028 (the “Extended Term”).

During the Extended Term, Mr.

Haddad will receive an annual retainer of $ 1.5 million and an annual performance bonus of $ 1.0 million that is contingent upon the occurrence of certain vesting events.

The Company incurred expense of $ 0.1 million related to the Extended Term for the year ended December 31, 2024, which is included in selling, general, and administrative expenses on the accompanying consolidated statement of operations.

Employment Transition Agreement and Advisory Agreement with Lynn Jochim

On February 9, 2022, the Company entered into an employment transition agreement with Lynn Jochim, the Company’s former President and Chief Operating Officer.

Pursuant to the agreement, Ms.

Jochim agreed to continue in her then current positions, at her then current compensation levels, until February 14, 2022.

Concurrently, the Company also entered into an advisory agreement with Ms.

Jochim for an initial term of three years , which became effective on February 15, 2022.

Pursuant to the advisory agreement, the Company agreed to pay Ms.

Jochim an annual retainer of $ 1.0 million.

At December 31, 2024 and 2023, included in accrued advisory fees in the table above is $ 0.1 million and $ 1.1 million, respectively, attributed to Ms.

Jochim’s advisory agreement (see Note 2).

Pursuant to a reimbursement deferral agreement with an affiliate of Lennar, principal and interest payments under the related party reimbursement obligation were deferred from October 2023 through December 31, 2025.

In January 2026, the Company paid $ 37.5 million in principal and $ 6.0 million in accrued interest that became due upon the expiration of the deferral agreement.

An additional $ 21.2 million is expected to be paid in 2026, however deferral notices from the lender to the Lennar affiliate may further extend the Company’s obligation to make reimbursement payments.

These deferred amounts, if any, will continue to incur interest at the original interest rate.

Advisory Agreement with Emile Haddad

The Company and Emile Haddad, a member of the Company’s board of directors and Chairman Emeritus, are parties to an advisory agreement with a current term ending December 1, 2028.

Haddad receives an annual retainer of $ 1.5 million and an annual performance bonus of $ 1.0 million that is contingent upon the occurrence of certain vesting events.

The Company incurred expense of $ 2.5 million and $ 0.1 million for the years ended December 31, 2025 and 2024, respectively, which is included in selling, general, and administrative expenses on the accompanying consolidated statements of operations.

Valencia Purchase and Sale Agreements

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In 2023, the Company entered into a purchase and sale agreement with an unaffiliated land banking entity for the sale of 583 homesites on approximately 46 acres at the Company’s Valencia community.

Initial gross proceeds were $ 101.8 million, representing

the base purchase price.

Initial gross proceeds were $ 101.8 million, representing the base purchase price.

Lennar retained the option to acquire these homesites in the future from the unaffiliated land banking entity and has historically exercised its options to acquire such homesites.

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In December 2024, the Company’s property management agreement with the Gateway Commercial Venture was terminated, and the Company is no longer managing any commercial operations at the Five Point Gateway Campus.

Operating Agreements with Hearthstone Funds (Performance Fee Contract Asset)

The Hearthstone Venture manages the operations and assets of the Hearthstone Funds and is entitled to receive asset management fees and in some cases performance fees from those funds upon the achievement of certain performance hurdles.

During the year ended December 31, 2025, the Hearthstone Venture recognized performance fee revenue of $ 4.4 million, and at December 31, 2025, included in contract assets in the table above is $ 10.4 million attributed to performance fee revenue recognized but not yet due (see Notes 3 and 4).

NOTES PAYABLE, NET

At December 31, 2025 and 2024, notes payable, net consisted of the following (in thousands):

10.500 % initial rate New Senior Notes due 2028

$ 523,494 $ —

8.000 % Senior Notes due 2030

$ 450,000 $ —

10.500 % initial rate Senior Notes due 2028

7.875 % Senior Notes due 2025

Unamortized premium — 2,591

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$ 443,348 $ 525,737

The Operating Company and Five Point Capital Corp., a directly wholly owned subsidiary of the Operating Company (the “Co-Issuer” and, together with the Operating Company, the “Issuers”), previously offered, sold and issued $ 625.0 million aggregate principal amount of 7.875 % unsecured senior notes due November 15, 2025 (the “Senior Notes”).

Interest on the Senior Notes is payable on May 15 and November 15 of each year.

The Senior Notes are guaranteed, jointly and severally, by certain direct and indirect subsidiaries of the Operating Company and are redeemable at the option of the Issuers, in whole or in part, at par, plus accrued and unpaid interest.

On January 16, 2024, the Issuers settled an exchange offer to exchange any and all of their $ 625.0 million 7.875 % Senior Notes for new 10.500 % initial rate senior notes due January 15, 2028 (the “New Senior Notes”).

Pursuant to the exchange offer, the Issuers exchanged $ 623.5 million aggregate principal amount of Senior Notes, which represented 99.76 % of the existing Senior Notes outstanding immediately prior to the exchange offer, for $ 523.5 million aggregate principal amount of New Senior Notes and $ 100.0 million of aggregate cash consideration, plus accrued interest.

The New Senior Notes accrue interest at a rate of 10.500 % per annum from and including January 16, 2024 to, but not including, November 15, 2025, 11.000 % per annum from and including November 15, 2025 to, but not including, November 15, 2026, and 12.000 % per annum from and including November 15, 2026 to, but not including, January 15, 2028.

Interest on the New Senior Notes is payable semi-annually on each May 15 and November 15, commencing May 15, 2024.

The exchange was accounted for as a debt modification under ASC 470-50 as the terms of the New Senior Notes were not substantially different from the terms of the Senior Notes.

Under debt modification accounting, third party costs are expensed as incurred.

During the year ended December 31, 2024, the Company expensed $ 5.9 million in third party transaction and advisory costs incurred in connection with the exchange.

Debt issuance costs and premium are amortized over the term of the New Senior Notes using the effective interest method, and at December 31, 2024 the effective interest rate was 11.13 %.

The New Senior Notes are guaranteed, jointly and severally, by certain direct and indirect subsidiaries of the Operating Company and are redeemable at the option of the Issuers, in whole or in part, at a declining call premium as set forth in the indenture governing the New Senior Notes, plus accrued and unpaid interest.

Interest incurred, including amortization of debt issuance costs and premium, on the Senior Notes and New Senior Notes during the years ended December 31, 2024, 2023 and 2022 totaled $ 58.4 million, $ 50.8 million and $ 50.8 million, respectively.

After completing an exchange offer in January 2024, the Operating Company and Five Point Capital Corp., a direct wholly owned subsidiary of the Operating Company (the “Co-Issuer” and, together with the Operating Company, the “Issuers”), had two tranches of unsecured senior notes outstanding, which included the 10.500 % initial rate senior notes due January 2028 (the “2028 Notes”) and the unexchanged portion of the 7.875 % senior notes due November 2025 (the “2025 Notes”).

On September 25, 2025, the Issuers offered, sold and issued $ 450.0 million aggregate principal amount of 8.000 % unsecured senior notes due October 1, 2030 (the “2030 Notes”).

Net proceeds from the offering, after underwriting fees and offering expenses, were $ 444.0 million.

The Company incurred an additional $ 1.0 million in third party transaction and advisory costs in connection with the offering, resulting in aggregate debt issuance costs of $ 7.0 million.

The 2030 Notes accrue interest at a rate of 8.000 % per annum.

Interest on the 2030 Notes is payable semi-annually in arrears on April 1 and October 1, commencing April 1, 2026.

The 2030 Notes are guaranteed, jointly and severally, by certain direct and indirect subsidiaries of the Operating Company and are redeemable at the

option of the Issuers, in whole or in part, at a declining call premium as set forth in the indenture governing the 2030 Notes, plus accrued and unpaid interest.

Also on September 25, 2025, the Issuers used the net proceeds from the issuance of the 2030 Notes, together with cash on hand, to (i) purchase $ 471.5 million in principal amount of the $ 523.5 million outstanding 2028 Notes that were validly tendered pursuant to a cash tender offer (the “Concurrent Tender Offer”) and (ii) redeem $ 52.0 million in principal amount of the remaining 2028 Notes that were not purchased in the Concurrent Tender Offer by concurrently delivering and irrevocably depositing amounts with the indenture trustee (the “Trust Amounts”) sufficient to fund the payment of the principal amount and interest due on November 15, 2025, the redemption date.

After the deposit of such Trust Amounts, the indenture governing the 2028 Notes was satisfied and discharged in accordance with its terms.

The Company recognized a loss on debt extinguishment totaling $ 1.8 million in connection with the refinancing.

Interest incurred, including amortization of debt issuance costs and premium, on the 2025 Notes, 2028 Notes and 2030 Notes during the years ended December 31, 2025, 2024 and 2023 totaled $ 52.9 million, $ 58.4 million and $ 50.8 million, respectively.

All interest incurred was capitalized to inventories for all three years.

Revolving Credit Facility

The Operating Company has a $ 125.0 million unsecured revolving credit facility, with $ 100.0 million of the commitments under the revolving credit facility maturing in July 2027 and the remaining $ 25.0 million commitment maturing in April 2026.

Any borrowings under the revolving credit agreement will bear interest at CME Term Secured Overnight Financing Rate 1 Month increased by 0.10 % plus a margin of either 2.25 % or 2.50 % based on the Company’s leverage ratio.

The revolving credit facility includes an accordion feature that allows the Operating Company to increase the maximum aggregate commitments up to $ 150.0 million, subject to certain conditions, including the receipt of commitments from the lenders.

The Operating Company has a $ 217.5 million unsecured revolving credit facility that matures in July 2029.

Any borrowings under the revolving credit agreement will bear interest at CME Term Secured Overnight Financing Rate 1 Month plus a margin of either 2.25 % or 2.50 % based on the Company’s leverage ratio.

The revolving credit facility may be further extended to July 2030, subject to the satisfaction of certain conditions, including the approval of the administrative agent and lenders.

As of December 31, 2025, no borrowings or letters of credit were outstanding on the Operating Company’s revolving credit facility.

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As of December 31, 2025, all leasing arrangements are classified as operating leases and do not contain residual value guarantees or material restrictions.

The Company’s office leases have remaining lease terms of approximately four years to five years , one of which includes a Company option to extend the lease for up to five years and one of which includes a landlord option to terminate the lease 18 months subsequent to written notice to the Company.

The Company’s office leases have remaining lease terms of approximately three years to four years and include one or more Company options to extend the leases for up to five years and one of which includes a landlord option to terminate the lease 18 months subsequent to written notice to the Company.

The Company only includes renewal options in the lease term when it is reasonably certain that it will exercise such options.

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Supplemental balance sheet information related to leases as of December 31, 2025 and 2024 were as follows (in thousands, except lease term in years and discount rate):

Operating lease right-of-use assets ($ 0 and $ 14,040 related party, respectively)

Operating lease right-of-use assets

$ 11,343 $ 12,973

Operating lease liabilities ($ 0 and $ 10,974 related party, respectively)

Operating lease liabilities

$ 9,989 $ 10,980

1 unchanged sentence

Weighted average discount rate (operating lease) 6.7 % 6.7 %

Operating lease right-of-use assets are included in other assets or related party assets and operating lease liabilities are included in accounts payable and other liabilities or related party liabilities on the consolidated balance sheets.

Operating lease right-of-use assets are included in other assets and operating lease liabilities are included in accounts payable and other liabilities on the consolidated balance sheets.

The table below reconciles the undiscounted cash flows to operating lease liabilities recorded on the consolidated balance sheet as of December 31, 2025 (in thousands):

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The Holding Company has provided a guaranty to the Settling Petitioners for monetary payments due from the Company as required under the settlement.

As of December 31, 2024, the remaining estimated maximum potential amount of monetary payments subject to the guaranty was $ 6.6 million with the final payment due in 2026.

As of December 31, 2025, the remaining estimated maximum potential amount of monetary payments subject to the guaranty was $ 4.8 million.

Valencia Water Purchase Agreement

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The San Francisco Agency can also earn a return of certain profits generated from the development and sale of Candlestick and The San Francisco Shipyard if certain thresholds are met.

At both December 31, 2024 and 2023, the San Francisco Venture had outstanding guarantees benefiting the San Francisco Agency for infrastructure and construction of certain park and open space obligations with aggregate maximum obligations of $ 198.3 million.

At December 31, 2025 and 2024, the San Francisco Venture had outstanding guarantees benefiting the San Francisco Agency for infrastructure and construction of certain park and open space obligations with aggregate maximum obligations of $ 198.9 million and $ 198.3 million, respectively.

In February 2026, the Company issued warrants to certain affiliates of Blue Owl Capital Inc.

(“Blue Owl”) to purchase up to 1,500,000 shares of the Company’s Class A common shares at an exercise price of $ 7.00 per share.

The warrants were issued in connection with the formation of a new residential land banking fund between HRH and Blue Owl, which will be managed by HRH.

The warrants vest based on aggregate capital contributions by Blue Owl to the partnership and, if vested, are exercisable for five years from issuance.

No cash consideration was received by the Company in exchange for the issuance of the warrants.

Letters of Credit

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The Company believes that it has meritorious defenses to the allegations in the Bayview Action and may have insurance and indemnification rights against third parties with respect to the claims.

In February 2026, the parties to the Bayview Action entered into a settlement agreement, which includes $ 10.8 million in damages to be paid out of insurance proceeds under a joint insurance policy held by the Company and Lennar, as well as a dismissal with prejudice to be entered on behalf of the Company.

The settlement amount is expected to be funded in full by the insurance policy.

Payment of the settlement and dismissal of the lawsuit are conditioned upon delivery of releases from the approximately 6,500 plaintiffs in the Bayview Action.

There can be no assurance that such releases will be delivered timely, or at all, or that the settlement will take effect as described above.

Other than the actions outlined above, the Company is also a party to various other claims, legal actions, and complaints arising in the ordinary course of business, the disposition of which, in the Company’s opinion, will not have a material adverse effect on the Company’s consolidated financial statements.

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Cash paid for interest, all of which was capitalized to inventories $ 47,445 $ 54,091 $ 51,278

Cash paid for income taxes $ 3,473 $ — $ —

Noncash lease expense $ 3,008 $ 2,788 $ 3,958

1 unchanged sentence

Adjustment to operating lease right-of-use assets from lease modification, net $ — $ ( 241 ) $ 982

Class A common shares issued for redemption of noncontrolling interests

$ 25,932 $ — $ —

Accrued financing costs $ 400 $ — $ 117

Adjustment to liability recognized under TRA $ 8,120 $ 215 $ 140

Senior Notes due 2025 exchanged for New Senior Notes due 2028 (see Note 10) $ 523,500 $ — $ —

Noncash lease expense is included within the depreciation and amortization adjustment to net income (loss) on the Company’s consolidated statements of cash flows.

Senior Notes due 2025 exchanged for Senior Notes due 2028 (see Note 11) $ — $ 523,500 $ —

Supplemental cash flow information related to cash paid for income taxes for the years ended December 31, 2025, 2024 and 2023 is as follows (in thousands):

2025 2024 2023

Federal $ 98 $ 47 $ —

6,516 3,426 —

Total $ 6,614 $ 3,473 $ —

(1) Income taxes paid, net of refunds, exceed 5% of total income taxes paid, net of refunds, in the following jurisdictions:

2025 2024 2023

California $ 6,513 $ 3,424 $ —

Noncash lease expense is included within the depreciation and amortization adjustment to net income on the Company’s consolidated statements of cash flows.

Supplemental cash flow information related to leases for the years ended December 31, 2025, 2024 and 2023 is as follows (in thousands):

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The Valencia segment derives revenues from the sale of residential and commercial land sites to homebuilders, commercial developers and commercial buyers.

The Company’s investment in the Valencia Landbank Venture is also reported in the Valencia segment.

• San Francisco—includes the Candlestick and The San Francisco Shipyard communities located on bayfront property in the City of San Francisco, California.

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The Great Park segment derives revenues at the Great Park Neighborhoods from sales of residential and commercial land sites to homebuilders, commercial developers and commercial buyers and management services provided by the Company to the Great Park Venture.

• Hearthstone—includes the Hearthstone Venture residential asset management platform focused on managing residential land banking programs across multiple U.S.

The Hearthstone segment derives revenues from management fees.

The Company’s chief operating decision maker (“CODM”) is the Company’s President and Chief Executive Officer.

The CODM seeks to allocate resources to the Company’s segments with the objective of maximizing value by managing capital and

overhead spend with revenue opportunities.

The CODM seeks to allocate resources to the Company’s segments with the objective of maximizing value by managing capital and overhead spend with revenue opportunities.

Segment profit is a measure that the CODM uses in the process of monitoring the performance of each segment and making operating decisions to best achieve those objectives.

Segment operating results and reconciliations to the Company’s consolidated balances for the years ended December 31, 2024, 2023 and 2022 are as follows:

For the year ended December 31, 2024

(in thousands)

Valencia San Francisco Great Park Total reportable segments Removal of Great Park Venture (1)

Segment operating results and reconciliations to the Company’s consolidated balances for the years ended December 31, 2025, 2024 and 2023 are as follows (in thousands):

Year ended December 31, 2025

Valencia San Francisco Great Park Hearthstone Total reportable segments Removal of Great Park Venture (1)

Add investment in Great Park Venture Corporate and unallocated (2)

17 unchanged sentences

After the sale of the Gateway Commercial Venture’s commercial operating assets in December 2024 (see Note 5), the Company’s commercial segment is no longer operating.

The Company has reported the equity in earnings from the Company’s investment in the Gateway Commercial Venture within the corporate and unallocated column in the table above.

(2) Corporate and unallocated activity is primarily comprised of corporate general and administrative expenses, interest income, income tax provision of $ 27.5 million, Senior Notes exchange costs and equity in earnings from the Gateway Commercial Venture.

The equity in earnings from the Company’s investment in the Gateway Commercial Venture is reported within the corporate and unallocated column in the table above.

(2) Corporate and unallocated activity is primarily comprised of corporate general and administrative expenses, interest income, income tax provision of $ 28.9 million, loss on debt extinguishment and equity in earnings from the Gateway Commercial Venture.

Corporate and unallocated assets consist of cash and cash equivalents, investment in the Gateway Commercial Venture, leasehold improvements, ROU assets, prepaid expenses and deferred financing costs.

(3) Other segment items for each reportable segment include:

• Valencia—operating properties expenses, pension costs and equity in earnings from the Valencia Landbank Venture.

• Valencia—operating properties expenses, pension benefit, miscellaneous other income and equity in earnings from unconsolidated entities.

• San Francisco—interest income.

• Great Park—interest income.

• Hearthstone—interest income and equity in earnings from Hearthstone Funds.

(4) Expenditures for long-lived assets are net of inventory cost reimbursements and other inventory cost recoveries and include noncash project accruals and capitalized interest.

For the year ended December 31, 2025, Valencia’s net expenditures include $ 8.3 million, San Francisco’s net expenditures include $ 1.1 million and Great Park Venture’s net expenditures include $ 63.8 million in inventory cost reimbursements and recoveries received.

For the year ended December 31, 2023

(in thousands)

Year ended December 31, 2024

Valencia San Francisco Great Park Total reportable segments Removal of Great Park Venture (1)

3 unchanged sentences

Cost of land sales 90,109 — 144,876 234,985 ( 144,876 ) — — 90,109

105,651 — 237,309 342,960 ( 237,309 ) — — 105,651

Management services — — 23,852 23,852 — — — 23,852

13 unchanged sentences

After the sale of the Gateway Commercial Venture’s commercial operating assets in December 2024 (see Note 5), the Company’s commercial segment is no longer operating.

The Company has recast the segment presentation for the comparative prior period to report the equity in loss from the Company’s investment in the Gateway Commercial Venture within the corporate and unallocated column in the table above.

(2) Corporate and unallocated activity is primarily comprised of corporate general and administrative expenses, interest income, income tax benefit of $ 4.4 million, Senior Notes exchange costs and equity in loss from the Gateway Commercial Venture.

The equity in earnings from the Company’s investment in the Gateway Commercial Venture is reported within the corporate and unallocated column in the table above.

Corporate and unallocated assets consist of cash and cash equivalents, investment in the Gateway Commercial Venture, leasehold improvements, ROU assets, prepaid expenses and deferred financing costs.

(3) For the year ended December 31, 2023, included within cost of land sales at the Great Park segment is cost of home sales of $ 0.2 million.

(3) Other segment items for each reportable segment include:

• Valencia—operating properties expenses, pension costs, miscellaneous other income and equity in earnings from the Valencia Landbank Venture.

• Valencia—operating properties expenses, pension costs and equity in earnings from unconsolidated entities.

• San Francisco—interest income.

• Great Park—interest income and equity in earnings from the Great Park Landbank Venture.

• Great Park—interest income.

(4) Expenditures for long-lived assets are net of inventory cost reimbursements and other inventory cost recoveries and include noncash project accruals and capitalized interest.

For the year ended December 31, 2024, Valencia’s net expenditures include $ 10.1 million, San Francisco’s net expenditures include $ 1.1 million and Great Park Venture’s net expenditures include $ 167.3 million in inventory cost reimbursements and recoveries received.

For the year ended December 31, 2022

(in thousands)

Year ended December 31, 2023

Valencia San Francisco Great Park Total reportable segments Removal of Great Park Venture (1)

3 unchanged sentences

Cost of land sales 105,651 — 237,309 342,960 ( 237,309 ) — — 105,651

( 996 ) — 185,384 184,388 ( 185,384 ) — — ( 996 )

Management services — — 22,170 22,170 — — — 22,170

14 unchanged sentences

(2) Corporate and unallocated activity is primarily comprised of corporate general and administrative expenses, interest income, income tax benefit of $ 1.5 million, restructuring expenses and equity in loss from the Gateway Commercial Venture.

Corporate and unallocated assets consist of cash and cash equivalents, investment in the Gateway Commercial Venture, leasehold improvements, ROU assets, prepaid expenses and deferred financing costs.

(3) For the year ended December 31, 2022, included within cost of land sales at the Great Park segment is cost of home sales of $ 29.7 million.

(3) Other segment items for each reportable segment include:

• Valencia—operating properties expenses, interest income, pension costs and equity in earnings from the Valencia Landbank Venture.

• Valencia—operating properties expenses, pension costs, miscellaneous other income and equity in earnings from unconsolidated entities.

• San Francisco—interest income.

• Great Park—interest income and equity in earnings from the Great Park Landbank Venture.

• Great Park—interest income and equity in earnings from unconsolidated entities.

(4) Expenditures for long-lived assets are net of inventory cost reimbursements and other inventory cost recoveries and include noncash project accruals and capitalized interest.

For the year ended December 31, 2023, Valencia’s net expenditures include $ 64.1 million, San Francisco’s net expenditures include $ 1.1 million and Great Park Venture’s net expenditures include $ 89.6 million in inventory cost reimbursements and recoveries received.

A third-party commercial builder represented one of the Company’s major customers during the year ended December 31, 2025, accounting for approximately $ 42.5 million, or 39 %, of total consolidated revenues.

Revenues generated from this customer were from the sale of industrial land in Valencia.

A third-party home builder represented one of the Company’s major customers during the year ended December 31, 2024, accounting for approximately $ 31.2 million, or 13 %, of total consolidated revenues.

6 unchanged sentences

Lennar retained the option to acquire these homesites in the future from the unaffiliated land banking entity and has historically exercised its options to acquire such homesites.

Lennar represented one of the Company’s major customers during the year ended December 31, 2022, accounting for approximately $ 7.5 million, or 18 %, of total consolidated revenues.

Revenues generated from Lennar primarily consisted of variable land sale consideration from profit participation in Valencia.

The Great Park Venture represented another of the Company’s major customers for the years ended December 31, 2025, 2024 and 2023, and accounted for approximately $ 53.5 million, or 49 %, $ 96.0 million, or 40 %, and $ 47.2 million, or 22 %, of total consolidated revenues, respectively.

1 unchanged sentence

SHARE-BASED COMPENSATION

In April 2023, the Company’s Board of Directors approved the Five Point Holdings, LLC 2023 Incentive Award Plan (the “Incentive Award Plan”) as the successor to the Five Point Holdings, LLC Amended and Restated 2016 Incentive Award Plan (the “Prior Plan”).

“Prior Plan”).

The Incentive Award Plan became effective on June 7, 2023, the date on which it was approved by shareholders at the 2023 Annual Meeting of Shareholders.

12 unchanged sentences

The model incorporates assumptions related to the expected volatility of our share price and risk free interest rates.

For awards granted during the years ended December 31, 2024 and 2023 , expected volatility was 46.78 % and 57.98 %, respectively, and was calculated based on the historical volatility of the Company’s common stock using daily share price returns over a three-year lookback period from the date of grant, and t he risk-free interest rate was 4.15 % and 4.44 %, respectively, and was based on U.S.

Awards with a three-year vesting period and five-year performance period were granted during the year ended December 31, 2025.

Expected volatility was 51.78 % and 47.37 %, respectively, and was calculated based on the historical volatility of the Company’s common stock using daily share price returns over a three-year and five-year lookback period from the date of grant, respectively, and t he risk-free interest rate was 3.64 % and 3.63 %, respectively, and was based on U.S.

Treasury yield curve rates with maturities consistent with the three-year vesting period and five-year performance period, respectively.

For awards granted during the year ended December 31, 2024, expected volatility was 46.78 % and was calculated based on the historical volatility of the Company’s common stock using daily share price returns over a three-year lookback period from the date of grant, and t he risk-free interest rate was 4.15 % and was based on U.S.

Treasury yield curve rates with maturities consistent with the three-year vesting period.

6 unchanged sentences

Nonvested at January 1, 2023 2,166 $ 3.77

( 834 ) $ 2.96

Cancelled ( 906 ) $ 2.16

( 798 ) $ 5.50

Nonvested at December 31, 2023 4,409 $ 2.13

Cancelled ( 906 ) $ 2.16

( 890 ) $ 4.57

1 unchanged sentence

( 1,146 ) $ 1.16

( 1,047 ) $ 3.14

Nonvested at December 31, 2025 8,614 $ 2.52

Share-based compensation expense was $ 7.6 million, $ 4.3 million and $ 3.7 million for the years ended December 31, 2025, 2024 and 2023, respectively.

In February 2022, the Company accelerated the expense attributed to the outstanding restricted share awards of two former officers of the Company resulting from a modification of the required service condition of the awards (see Note 2).

As a result, for the year ended December 31, 2022, share-based compensation expense of $ 3.0 million is included in restructuring expense and $ 3.2 million is included in selling, general, and administrative expenses on the accompanying consolidated statement of operations.

All share-based compensation for the years ended December 31, 2024 and 2023 is included in selling, general, and administrative expenses on the accompanying consolidated statements of operations.

Share-based compensation expense is included in selling, general, and administrative expenses on the accompanying consolidated statements of operations.

Approximately $ 11.9 million of total unrecognized compensation cost related to non-vested awards is expected to be recognized over a weighted-average period of 1.9 years from December 31, 2025.

The estimated fair value at vesting of share-based awards that vested during the years ended December 31, 2025, 2024 and 2023 was $ 5.8 million, $ 2.7 million, and $ 2.0 million, respectively.

Awards forfeited in 2025 represent awards with a market performance condition that were forfeited for no consideration as the threshold vesting condition was not achieved.

EMPLOYEE BENEFIT PLANS

15 unchanged sentences

Funded status $ 1,332 $ 1,344

Amounts recognized in the consolidated balance sheet—asset (liability) $ 1,344 $ ( 524 )

Amounts recognized in the consolidated balance sheet—asset $ 1,332 $ 1,344

Amounts recognized in accumulated other comprehensive loss—net actuarial loss $ ( 1,960 ) $ ( 1,881 )

The accumulated benefit obligation for the Retirement Plan was $ 13.7 million and $ 14.2 million at December 31, 2025 and 2024, respectively.

The components of net periodic cost (benefit) and other amounts recognized in accumulated other comprehensive loss for the years ended December 31, 2024, 2023 and 2022, are as follows (in thousands):

The components of net periodic (benefit) cost and other amounts recognized in accumulated other comprehensive loss for the years ended December 31, 2025, 2024 and 2023, are as follows (in thousands):

2025 2024 2023

Net periodic cost (benefit):

Net periodic (benefit) cost:

Interest cost $ 675 $ 767 $ 809

1 unchanged sentence

Amortization of net actuarial loss 59 198 162

Net periodic cost (benefit) 49 82 ( 245 )

Net periodic (benefit) cost ( 67 ) 49 82

Adjustment to accumulated other comprehensive loss:

Net actuarial (gain) loss ( 1,720 ) ( 889 ) 1,929

Net actuarial loss (gain) 138 ( 1,720 ) ( 889 )

Amortization of net actuarial loss ( 59 ) ( 198 ) ( 162 )

Total adjustment to accumulated other comprehensive loss 79 ( 1,918 ) ( 1,051 )

Total recognized in net periodic cost (benefit) and accumulated other comprehensive loss $ ( 1,869 ) $ ( 969 ) $ 1,429

Total recognized in net periodic (benefit) cost and accumulated other comprehensive loss $ 12 $ ( 1,869 ) $ ( 969 )

The weighted-average assumptions used to determine benefit obligations as of December 31, 2025 and 2024 were as follows:

26 unchanged sentences

bonds and short term

13,662 11,922

Total $ 15,076 $ 15,593

53 unchanged sentences

Accordingly, a deferred tax asset has been reflected for the net effect of this temporary difference.

A reconciliation of the statutory rate and the effective tax rate for 2024, 2023 and 2022 is as follows:

A reconciliation of the statutory rate and the effective tax rate for 2025, 2024 and 2023 is as follows (in thousands, except rate percentages):

2025 2024 2023

Statutory rate 21.00 % 21.00 % 21.00 %

State income taxes-net of federal income tax benefit 6.98 6.98 6.98

US federal statutory tax rate $ ( 44,616 ) 21.00 % $ ( 43,070 ) 21.00 % $ ( 22,953 ) 21.00 %

State and local income taxes-net of federal income tax effect (1)

( 7,510 ) 3.53 ( 6,894 ) 3.36 ( 3,288 ) 3.01

Tax credits 1,124 ( 0.53 ) 559 ( 0.27 ) — —

Changes in valuation allowances — — — — 17,560 ( 16.07 )

Nontaxable or nondeductible items

Pass-through to noncontrolling interests 23,637 ( 11.12 ) 22,823 ( 11.13 ) 12,248 ( 11.21 )

Executive compensation limitation and other permanent items 0.41 ( 1.08 ) ( 3.35 )

Deferred tax asset valuation allowance — ( 16.07 ) ( 5.45 )

Expiration of unused loss carryforwards — 0.06 ( 0.17 )

Effective rate 13.47 % ( 4.04 ) % 4.06 %

Other ( 1,198 ) 0.56 ( 848 ) 0.49 ( 815 ) 0.75

Other adjustments

Other ( 362 ) 0.17 ( 32 ) 0.02 1,666 ( 1.52 )

(Provision) benefit for income taxes/Effective tax rate $ ( 28,925 ) 13.61 % $ ( 27,462 ) 13.47 % $ 4,418 ( 4.04 ) %

(1) State taxes in California made up the majority (greater than 50%) of the tax effect in this category.

At December 31, 2025 and 2024, the Holding Company did not have any gross unrecognized tax benefits, and did not require an accrual for interest or penalties.

6 unchanged sentences

The Company has concluded that there were no significant uncertain tax positions requiring recognition in its financial statements, nor has the Company been assessed interest or penalties by any major tax jurisdictions related to any open tax periods.

On July 4, 2025, H.R.1, the One Big Beautiful Bill Act, was signed into law, which includes a broad range of tax reform provisions affecting businesses.

There was no material impact on the Company’s consolidated financial statements as a result of the legislation for the for the year ended December 31, 2025.

FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS AND DISCLOSURES

4 unchanged sentences

At December 31, 2024, the estimated fair value of notes payable, net was $ 534.8 million compared to a carrying value of $ 525.7 million.

During the years ended December 31, 2024, 2023 and 2022, the Company had no assets that were measured at fair value on a nonrecurring basis.

During the years ended December 31, 2025, 2024 and 2023, the Company had no assets, other than those items related to the Hearthstone acquisition (see Note 3), that were measured at fair value on a nonrecurring basis.

EARNINGS PER SHARE

9 unchanged sentences

The more dilutive of the two methods is included in the calculation for diluted income (loss) per share.

The following table summarizes the basic and diluted earnings (loss) per share calculations for the years ended December 31, 2024, 2023 and 2022 (in thousands, except shares and per share amounts):

The following table summarizes the basic and diluted earnings per share calculations for the years ended December 31, 2025, 2024 and 2023 (in thousands, except shares and per share amounts):

2025 2024 2023

Net income (loss) attributable to the Company $ 68,297 $ 55,394 $ ( 15,403 )

Adjustments to net income (loss) attributable to the Company ( 33 ) ( 16 ) 85

Net income (loss) attributable to common shareholders $ 68,264 $ 55,378 $ ( 15,318 )

Net income attributable to the Company $ 70,966 $ 68,297 $ 55,394

Adjustments to net income attributable to the Company ( 304 ) ( 33 ) ( 16 )

Net income attributable to common shareholders $ 70,662 $ 68,264 $ 55,378

Numerator — basic common shares:

Net income (loss) attributable to common shareholders $ 68,264 $ 55,378 $ ( 15,318 )

Net income attributable to common shareholders $ 70,662 $ 68,264 $ 55,378

net income allocated to participating securities $ 55 $ 84 $ 270

Allocation of basic net income (loss) among common shareholders $ 68,180 $ 55,108 $ ( 15,318 )

Numerator for basic net income (loss) available to Class A common shareholders $ 68,157 $ 55,089 $ ( 15,313 )

Numerator for basic net income (loss) available to Class B common shareholders $ 23 $ 19 $ ( 5 )

Allocation of basic net income among common shareholders $ 70,607 $ 68,180 $ 55,108

Numerator for basic net income available to Class A common shareholders $ 70,584 $ 68,157 $ 55,089

Numerator for basic net income available to Class B common shareholders $ 23 $ 23 $ 19

Numerator — diluted common shares:

Net income (loss) attributable to common shareholders $ 68,264 $ 55,378 $ ( 15,318 )

Reallocation of income (loss) from dilutive potential securities $ 72,818 $ 55,891 $ ( 252 )

Net income attributable to common shareholders $ 70,662 $ 68,264 $ 55,378

Reallocation of income from dilutive potential securities $ 72,401 $ 72,818 $ 55,891

net income allocated to participating securities $ 53 $ 82 $ 258

Allocation of diluted net income (loss) among common shareholders $ 141,000 $ 111,011 $ ( 15,570 )

Numerator for diluted net income (loss) available to Class A common shareholders $ 140,977 $ 110,992 $ ( 15,565 )

Numerator for diluted net income (loss) available to Class B common shareholders $ 23 $ 19 $ ( 5 )

Allocation of diluted net income among common shareholders $ 143,010 $ 141,000 $ 111,011

Numerator for diluted net income available to Class A common shareholders $ 142,987 $ 140,977 $ 110,992

Numerator for diluted net income available to Class B common shareholders $ 23 $ 23 $ 19

Basic weighted average Class A common shares outstanding 69,976,942 69,224,327 68,826,340

1 unchanged sentence

Basic and diluted weighted average Class B common shares outstanding 78,554,548 79,233,544 79,233,544

Basic earnings (loss) per share:

Basic earnings per share:

Class A common shares

2 unchanged sentences

$ 0.00 $ 0.00 $ 0.00

Diluted earnings (loss) per share:

Diluted earnings per share:

Class A common shares

11 unchanged sentences

Net actuarial gains or losses are re-determined annually or upon remeasurement events and principally arise from changes in the rate used to discount benefit obligations and differences between expected and actual returns on plan assets.

miscellaneous other (expense) income on the accompanying consolidated statements of operations for the years ended December 31, 2024, 2023 and 2022, respectively.

Reclassifications from accumulated other comprehensive loss to net income (loss) attributable to the Company related to amortization of net actuarial losses were approximately $ 32,000 , $ 91,000 and $ 102,000 , net of taxes, and are included in miscellaneous other (expense) income on the accompanying consolidated statements of operations for the years ended December 31, 2025, 2024 and 2023, respectively.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data