Five Point Holdings LLC (FPH) 2023 Q1 法說會逐字稿

Greetings, and welcome to the Five Point Holdings, LLC First Quarter 2023 Conference Call. As a reminder, this call is being recorded. Today's conference may include forward-looking statements regarding Five Point's business, financial condition, operations, cash flow, strategy and prospects. Forward-looking statements represent Five Point's estimates on the date of this conference call and are not intended to give any assurance as to actual future results. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties. Many factors could affect future results and may cause Five Point's actual activities or results to differ materially from the activities and results anticipated in forward-looking statements. These factors include those described in today's press release and Five Point's SEC filings, including those in the Risk Factors section of Five Point's most recent annual report on Form 10-K filed with the SEC. Please note that Five Point assumes no obligation to update any forward-looking statements.

您好，歡迎來到五點控股有限責任公司 2023 年第一季度電話會議。提醒一下，此通話正在錄音中。今天的會議可能包括有關 Five Point 的業務、財務狀況、運營、現金流、戰略和前景的前瞻性陳述。前瞻性陳述代表 Five Point 對本次電話會議日期的估計，並不旨在對未來的實際結果提供任何保證。由於前瞻性陳述涉及尚未發生的事項，因此這些陳述本身就存在風險和不確定性。許多因素可能會影響未來的結果，並可能導致 Five Point 的實際活動或結果與前瞻性陳述中預期的活動和結果存在重大差異。這些因素包括今天的新聞稿和 Five Point 向美國證券交易委員會提交的文件中描述的因素，包括 Five Point 最近向美國證券交易委員會提交的 10-K 表格年度報告的風險因素部分中的那些因素。請注意，Five Point 不承擔更新任何前瞻性陳述的義務。

Now I would like to turn the call over to Dan Hedigan, Chief Executive Officer.

現在我想把電話轉給首席執行官 Dan Hedigan。

Thank you. Good afternoon, everyone, and thank you for joining our call. I have with me today Leo Kij, our Interim Chief Financial Officer; Mike Alvarado, our Chief Legal Officer; Greg McWilliams, our Chief Policy Officer; and Kim Tobler, our Vice President, Treasury and Tax. Stuart Miller, our Executive Chairman, is joining us remotely.

謝謝。大家下午好，感謝您加入我們的電話會議。今天和我在一起的是我們的臨時首席財務官 Leo Kij； Mike Alvarado，我們的首席法務官； Greg McWilliams，我們的首席政策官；以及我們的財政部和稅務副總裁 Kim Tobler。我們的執行主席 Stuart Miller 正在遠程加入我們。

I'm pleased to update you today on the progress of the company through the first quarter of this year. I will also update you on our team's focus during the quarter as we work through a complicated real estate market and the steps we are taking to implement our strategic focus in 2023. Next, Leo will give an overview of the company's financial performance and condition. We will then open the line for questions to our management team.

我很高興今天向您介紹公司今年第一季度的進展情況。我還將向您介紹本季度我們團隊在復雜的房地產市場中的工作重點，以及我們為實施 2023 年戰略重點而採取的步驟。接下來，Leo 將概述公司的財務業績和狀況。然後，我們將開通向我們的管理團隊提問的熱線。

With that said, our financial results for the first quarter of 2023, reflect continued progress and improvement for Five Point in what have been challenging economic conditions. While for the quarter, although we had a consolidated net loss of $9.7 million, we continue to carefully manage cash outflows and our SG&A continue to shrink to $13.8 million, which is 18.1% lower than Q1 of 2022. Our first quarter is typically a weak quarter for revenues and bottom line. We have positioned the company for substantial cash flow in the second quarter, with the sizeable land sale and other cash generation at the great part that we anticipate will result in a meaningful distribution of the partnership in the quarter. We also expect to increase our cash flow in bottom line over the course of the year, to additional sales that are positioned for closing before year-end.

話雖如此，我們 2023 年第一季度的財務業績反映了 Five Point 在充滿挑戰的經濟條件下的持續進步和改善。在本季度，儘管我們的綜合淨虧損為 970 萬美元，但我們繼續謹慎管理現金流出，我們的 SG&A 繼續縮減至 1380 萬美元，比 2022 年第一季度低 18.1%。我們的第一季度通常表現疲軟收入和底線的季度。我們已將公司定位為第二季度的大量現金流，我們預計在很大程度上會產生大量土地出售和其他現金產生，從而在本季度對合作夥伴關係進行有意義的分配。我們還希望在這一年中將我們的現金流量增加到年底前完成的額外銷售額。

At the end -- at the quarter end, our balance sheet reflected $106.6 million of cash on hand and $0 drawn on our $125 million revolver, giving us available liquidity of $231.6 million and a debt to capitalization ratio of 25.2%. We also have no principal debt repayment obligations on our senior notes this year or next. From an economic perspective, the first quarter continued to be a complicated one in the land market even while the home sales market started to stabilize.

最後——在季度末，我們的資產負債表反映了 1.066 億美元的手頭現金和 0 美元的 1.25 億美元左輪手槍提款，使我們的可用流動資金為 2.316 億美元，債務資本化比率為 25.2%。今年或明年，我們的優先票據也沒有本金償還義務。從經濟角度來看，第一季度的土地市場仍然複雜，儘管房屋銷售市場開始趨於穩定。

Although we entered January with interest rates declining and homebuyer demand increasing from fourth quarter levels, interest in land purchases remained quiet through the quarter. Of course, in March, issues arising out of Silicon Valley Bank and the banking world continue to limit interest in land purchases as the market sorted out the banking crisis. Nevertheless, we expect interest in land acquisition to accelerate this quarter and next quarter as the banking crisis subside and home sales continue to stabilize and accelerate as well.

儘管我們進入 1 月份時利率下降，購房者需求從第四季度的水平開始增加，但整個季度土地購買興趣仍然低迷。當然，在 3 月份，隨著市場解決了銀行業危機，矽谷銀行和銀行界出現的問題繼續限制了土地購買的興趣。儘管如此，我們預計隨著銀行業危機消退以及房屋銷售繼續穩定和加速，本季度和下季度對土地收購的興趣將增加。

We're already seeing that homebuyers are adjusting to the new interest rate environment, expanding buyer demand and piquing homebuilder interest in future land offerings. Additionally, housing continues to be in short supply in our California markets, and there is still demand for well-located homes and master planned communities. Recognizing these underlying positive drivers, our goal is to remain patient and manage our business to the current realities of the market, while we feel confident that land buyers will soon seek to purchase land to satisfy housing demand. To that end, we'll continue to work with the builders to sell land at prices that reflect the balance between current market conditions and the scarcity of entitled land inventory in our markets. I'll speak a bit more to this in a moment when I give you my community update.

我們已經看到購房者正在適應新的利率環境，擴大買家需求並激起房屋建築商對未來土地供應的興趣。此外，我們加州市場的住房仍然供不應求，而且對位置優越的住宅和總體規劃社區仍有需求。認識到這些潛在的積極驅動因素，我們的目標是保持耐心並根據當前市場現實管理我們的業務，同時我們相信土地買家將很快尋求購買土地以滿足住房需求。為此，我們將繼續與建築商合作，以反映當前市場狀況與我們市場上可用土地庫存稀缺性之間的平衡的價格出售土地。稍後，當我向您介紹我的社區更新時，我會對此進行更多說明。

On the commercial land side of our business, we remain optimistic and moving forward with our unique commercial land offerings at the Great Park and Valencia. We continue to have historically low vacancy rates in the industrial market, coupled with continued rent growth, which we expect will continue to drive demand in this preferred asset class. Our desirable communities and our unique assets are complemented by a balance sheet that enables us to maximize value with patient offerings. Last quarter, I told you that we are in control of our business. And to that end, we have continued executing on our 3 many priorities: generating revenue, managing, limiting our capital spend and rightsizing our SG&A. I commend our team for their focus during the first quarter on these priorities.

在我們業務的商業用地方面，我們保持樂觀，並繼續推進我們在 Great Park 和 Valencia 提供的獨特商業用地產品。工業市場的空置率繼續處於歷史低位，加上租金持續增長，我們預計這將繼續推動這一首選資產類別的需求。我們理想的社區和我們獨特的資產得到了資產負債表的補充，使我們能夠通過患者服務實現價值最大化。上個季度，我告訴過你我們控制著我們的業務。為此，我們繼續執行我們的 3 個優先事項：創造收入、管理、限制我們的資本支出和調整我們的 SG&A。我讚揚我們的團隊在第一季度專注於這些優先事項。

As of the start of each year, our primary focus has been directed towards positive cash generation and this will remain our priority for the remainder of 2023. We have a variety of sources of cash, only some of which we reported as revenue in our financial statements. These sources include land sales, distributions from joint ventures, proceeds from public financing structures we have in place in our communities that reimburse us for significant portions of the infrastructure we construct in our communities. I think you've -- in the past, you've heard me refer to these as our CFD and our TIF or our tax reimbursement financing proceeds.

從每年年初開始，我們的主要重點是產生積極的現金，這將是我們在 2023 年剩餘時間裡的首要任務。我們有多種現金來源，其中只有一部分在我們的財務報告中作為收入報告聲明。這些來源包括土地銷售、合資企業的分配、我們在社區中建立的公共融資結構的收益，這些結構補償了我們在社區建設的大部分基礎設施。我想你 - 過去，你聽說過我將這些稱為我們的差價合約和我們的 TIF 或我們的退稅融資收益。

We also received management fees incentive compensation and then other reimbursements and recoveries. Consistent with our 2023 business plan, we didn't expect any significant revenue events in the first quarter. However, we did receive $17.7 million of CFD proceeds in Valencia and made good progress in moving forward with new land sale opportunities, which we believe will allow us to meet the positive cash generation guidance we gave you on our last call. Regarding how we are progressing with our other 2 priorities, managing our capital spend and managing SG&A, we are tracking closely to the guidance we gave you for the first half of the year, which was SG&A of approximately $25 million and capital spend between $45 million and $55 million.

我們還收到了管理費獎勵補償以及其他報銷和追回。與我們的 2023 年業務計劃一致，我們預計第一季度不會出現任何重大收入事件。然而，我們確實在瓦倫西亞收到了 1770 萬美元的差價合約收益，並在推進新的土地銷售機會方面取得了良好進展，我們相信這將使我們能夠滿足我們在上次電話會議上給你的積極的現金生成指導。關於我們在其他 2 個優先事項（管理我們的資本支出和管理 SG&A）方面的進展情況，我們正在密切跟踪我們為您提供的上半年指導，即 SG&A 約為 2500 萬美元，資本支出在 4500 萬美元之間和 5500 萬美元。

We've been minimizing our infrastructure and land development spend where we do not foresee a near-term revenue event and have been continuing to reduce SG&A, where possible and prudent to do so. As a result, we expect to finish the second quarter consistent with or better than our guidance on capital spend and SG&A. I'd also like to mention that we are continuing to stay focused on the little things that can make a difference in achieving our goals. Just 2 examples in this last quarter were a reduction in our rental expenses and our labor costs.

我們一直在盡量減少我們預計不會出現近期收入事件的基礎設施和土地開發支出，並在可能和謹慎的情況下繼續減少 SG&A。因此，我們預計第二季度結束時與我們對資本支出和 SG&A 的指導一致或更好。我還想提一下，我們將繼續專注於可以對實現我們的目標產生影響的小事。上個季度只有兩個例子是我們的租金支出和勞動力成本的減少。

In San Francisco, we were able to renegotiate our office lease to take significantly less space and reduce our costs, saving $800,000 this year and $1.6 million on an annualized basis. Also during the quarter, we further reduced our staffing levels, which we anticipate will result in additional savings of approximately $1 million during the year. We believe these incremental improvements in our SG&A matter over time, and we'll continue to stay focused on the smaller improvements alongside the more impactful improvements we can make to our business through managing our capital spend and taking additional steps to improve our land residuals. Finally, while we stay focused on SG&A, we're also actively and prudently managing our cash balances, particularly in light of the recent events with the regional banks.

在舊金山，我們能夠重新協商我們的辦公室租約，以顯著減少空間並降低成本，今年節省 800,000 美元，年化節省 160 萬美元。同樣在本季度，我們進一步減少了人員配置水平，我們預計這將在年內額外節省約 100 萬美元。我們相信隨著時間的推移，我們 SG&A 的這些漸進式改進很重要，我們將繼續專注於較小的改進，以及我們可以通過管理我們的資本支出和採取額外措施改善我們的土地剩餘物來對我們的業務進行更有影響力的改進。最後，在我們繼續專注於 SG&A 的同時，我們也在積極謹慎地管理我們的現金餘額，特別是考慮到最近與區域銀行發生的事件。

I'll now provide some updates on each of our communities. The (inaudible) neighborhood at the Great Park continue to sell homes with a strong increase in sales since the beginning of the year. During the first quarter, builders in our Great park community sold 255 homes, up from 113 homes in Q4. Solis Park, our primary selling community with multiple actual offerings, which had its first model complex opened in July 22, currently has 409 homes remaining to sell out of the original 849 homes. With the acceleration of new home sales, we're seeing strong builder interest in acquiring new homesites at Great Park. We're actively negotiating an agreement for the residential programs in our next community, District 5 South, which is a community of 719 homes in 11 neighborhoods. You might recall that this was a community we initially brought to market in 2022, just prior to the beginning of the Fed's interest rate hikes, which we then pulled off the market when the builders were assessing how the new home market will react to the interest rate increases.

我現在將提供有關我們每個社區的一些更新。 Great Park 的（聽不清）社區繼續銷售房屋，自年初以來銷售額強勁增長。第一季度，我們 Great Park 社區的建築商售出了 255 套房屋，高於第四季度的 113 套。 Solis Park 是我們的主要銷售社區，擁有多個實際產品，其第一個模型綜合體於 7 月 22 日開業，目前還有 409 套待售房屋，而最初的 849 套房屋已售完。隨著新屋銷售的加速，我們看到建築商對在 Great Park 購買新宅基地的興趣濃厚。我們正在積極協商下一個社區 5 South 的住宅項目協議，該社區由 11 個社區的 719 戶人家組成。您可能還記得，這是我們最初在 2022 年推向市場的社區，就在美聯儲開始加息之前，然後當建築商評估新房市場對利率的反應時，我們將其撤出市場率增加。

We're also actively engaged in sales of the remaining 81 homesites in our (inaudible) community, which would close out the sale of all homesites in this community. Both of these sales are expected to close in the current quarter. Finally, indicative of the scarcity of land and growing demand for new homesites by our builders, we're actively negotiating the sale of another 80 home program, which we anticipate closing by year-end. On top of the ongoing residential opportunities at Great Park, we have put an additional commercial site in escrow with closing expected this year and also anticipate the sale of the final (inaudible) initial commercial land offering, which you may recall, came on the market in August last year. While not the most opportune time to enter the market, our location in the heart of Orange County has supported strong interest. Our commercial parcels offered to the South Orange County market, something that's not been available for years, large parcels of entitled land (inaudible) allows a multitude of uses, including industrial, distribution, life sciences, R&D and office, among others.

我們還積極參與我們（聽不清）社區中其餘 81 個住宅的銷售，這將結束該社區所有住宅的銷售。預計這兩項銷售都將在本季度結束。最後，由於土地稀缺和我們的建築商對新住宅用地的需求不斷增長，我們正在積極協商出售另一個 80 套住宅計劃，我們預計該計劃將在年底前完成。除了 Great Park 正在進行的住宅機會之外，我們還託管了一個額外的商業用地，預計將於今年關閉，並且還預計最終（聽不清）初始商業土地的銷售，您可能還記得，上市去年八月。雖然不是進入市場的最佳時機，但我們位於奧蘭治縣中心的位置支持了強烈的興趣。我們提供給南奧蘭治縣市場的商業地塊，多年來一直沒有，大塊有權利的土地（聽不清）允許多種用途，包括工業、分銷、生命科學、研發和辦公等。

In Valencia, new home sales by builders totaled 75 homes during the first quarter, up from 49 homes in the fourth quarter. 11 of 18 programs on original offerings are sold out, and currently, there are only 246 homes remaining from our initial 1,268 home offering. So we continue to work on their models for next era of Valencia, which encompasses 8 new neighborhoods and 598 homes. Two of these neighborhoods are expected to open in the second quarter, creating additional inventory to drive home sales. Like Irvine, those are again engaged with us in Valencia, and we anticipate to enter into new land agreements in the second quarter.

在瓦倫西亞，建築商在第一季度銷售的新房總數為 75 套，高於第四季度的 49 套。原始產品的 18 個項目中有 11 個已售罄，目前，我們最初提供的 1,268 套房屋只剩下 246 套。因此，我們繼續為瓦倫西亞的下一個時代開發他們的模型，其中包括 8 個新社區和 598 個住宅。其中兩個社區預計將在第二季度開放，從而創造更多庫存以推動房屋銷售。與歐文一樣，他們再次在瓦倫西亞與我們接洽，我們預計將在第二季度簽訂新的土地協議。

We also continue to look at opportunities to add single-family floor rent and multifamily floor rent products to our mix of land sale offerings. These rental products continue to be a strong real estate segment that would provide housing options for residents and land sale revenues for us even during this time when the for-sale residential market is adjusting to higher interest rates. This quarter, we've also brought to market a prime 35-acre commercial site, which is garnering strong interest, and we expect to have more to report on that later in the year.

我們還繼續尋找機會，將單戶地板租金和多戶地板租金產品添加到我們的土地銷售產品組合中。這些租賃產品仍然是一個強大的房地產細分市場，即使在待售住宅市場正在適應更高利率的這段時間裡，它們也會為居民提供住房選擇，並為我們帶來土地銷售收入。本季度，我們還推出了一個佔地 35 英畝的優質商業用地，引起了強烈興趣，我們預計在今年晚些時候會有更多相關報告。

San Francisco remains a priority for Five Point. In this quarter, we progressed in our efforts to obtain city and county approval plan that rebalances the current development entitlements to facilitate Candlestick moving forward ahead of the Hunters Point Shipyard site. Concurrently, we're also working with the city to update the existing tax income and financing time lines to account for the Navy delays at Hunters point. 2023 will be an important year for San Francisco as we work through these issues and set the groundwork for the stand-alone development of (inaudible) as the first phase of this larger mixed-use community, which is located on irreplaceable land along the San Francisco Bay.

舊金山仍然是 Five Point 的優先目標。在本季度，我們在獲得市縣批准計劃方面取得了進展，該計劃重新平衡了當前的開發權利，以促進 Candlestick 在 Hunters Point Shipyard 場地之前向前推進。同時，我們還與市政府合作，更新現有的稅收收入和融資時間表，以解決獵人角的海軍延誤問題。 2023 年對舊金山來說將是重要的一年，因為我們將解決這些問題，並為獨立開發（聽不清）奠定基礎，作為這個更大的混合用途社區的第一階段，該社區位於舊金山沿岸不可替代的土地上舊金山灣。

Last quarter amid the uncertainty and challenging market conditions we anticipated for 2023, we provided some general guidance focused on the first half of this year. We're not going to change our general guidance at this point other than to say, we anticipate that our overall results will be consistent with or better than that guidance. We have a number of active negotiations in progress, and we'll be in a better position to update you on our expectations for the second half of the year on our Q2 call. In summary, the New Year started on a positive but cautious note. While headwinds remain as we manage through interest rate increases, inflation and credit tightening in banking sector, we are optimistic about the opportunities available to us in 2023. We will continue to focus on generating revenue, managing our capital spend and managing SG&A, while monitoring the market, and we'll adjust our plans proactively to preserve and maximize the value of our master planned communities. We have positive momentum, and we're feeling very optimistic about our future.

上個季度，在我們預計 2023 年的不確定性和挑戰性市場條件下，我們提供了一些針對今年上半年的總體指導。除了說我們預計我們的總體結果將與該指導一致或更好之外，我們此時不會改變我們的一般指導。我們正在進行一些積極的談判，我們將能夠更好地在我們的第二季度電話會議上向您更新我們對下半年的預期。總而言之，新年以積極但謹慎的基調開始。儘管在我們通過加息、通貨膨脹和銀行業信貸緊縮進行管理時仍然存在逆風，但我們對 2023 年提供給我們的機會持樂觀態度。我們將繼續專注於創造收入、管理我們的資本支出和管理 SG&A，同時監控市場，我們將主動調整我們的計劃，以維護和最大化我們總體規劃社區的價值。我們有積極的勢頭，我們對我們的未來感到非常樂觀。

Now let me turn it over to Leo, who will report on our financial results.

現在讓我把它交給 Leo，他將報告我們的財務結果。

Thanks, Dan. A summary of our financial results was included in the earnings release issued earlier today in which we reported consolidated net loss of $9.7 million for the quarter. We recognized $5.7 million in revenue that was primarily from management services provided by our management company. Selling, general and administrative expenses were $13.8 million, which represents a reduction of 18% or $3 million compared to the same quarter last year. The decrease reflects our reduction in headcount as previously reported as well as a reduction in selling and marketing expenses. Equity and earnings from our unconsolidated entities for the quarter was $1 million and primarily represents our interest in net income generated at the Great Park venture.

謝謝，丹。我們的財務業績摘要包含在今天早些時候發布的財報中，其中我們報告本季度綜合淨虧損為 970 萬美元。我們確認了 570 萬美元的收入，主要來自我們的管理公司提供的管理服務。銷售、一般和管理費用為 1380 萬美元，與去年同期相比減少 18% 或 300 萬美元。減少反映了我們之前報告的員工人數減少以及銷售和營銷費用的減少。本季度我們未合併實體的股權和收益為 100 萬美元，主要代表我們對 Great Park 風險投資產生的淨收入的興趣。

Turning to the balance sheet and liquidity. Our net increase in inventory for the quarter was $21.5 million. This increase includes accrued capitalized interest on our senior notes of $12.3 million and a decrease of $17.7 million through reimbursement from a communities facilities district or CFD, for certain public infrastructure costs that have been incurred as part of the development process at our Valencia segment. Excluding capitalized interest and CFD reimbursement, the resulting increase in inventory of $26.9 million was consistent with the prior quarter and 24% lower than the prior year increase of $35.6 million.

轉向資產負債表和流動性。我們本季度的庫存淨增加額為 2150 萬美元。這一增長包括我們優先票據的應計資本化利息 1,230 萬美元，以及通過社區設施區或 CFD 的償還而減少的 1,770 萬美元，這些費用是我們瓦倫西亞分部開發過程中產生的某些公共基礎設施成本。不包括資本化利息和差價合約償還，由此產生的庫存增加 2690 萬美元與上一季度一致，比去年同期增加的 3560 萬美元低 24%。

During the quarter, we paid $1.4 million in addition to $700,000 of interest against our related party EB-5 reimbursement obligation. Approximately $9 million of this reimbursement obligation that was previously expected to be paid in the first quarter has been deferred to the first quarter of 2024. Our related party has a history of receiving maturity date extensions, and we expect additional deferrals during 2023. However, such further extensions are not within our control, and there can be no assurance that any such extensions will be obtained.

在本季度，除了 700,000 美元的利息外，我們還為我們的關聯方 EB-5 償還義務支付了 140 萬美元。之前預計在第一季度支付的這項報銷義務中約有 900 萬美元已推遲到 2024 年第一季度。我們的關聯方有收到到期日延期的歷史，我們預計 2023 年還會有更多延期。但是，此類進一步延期不在我們的控制範圍內，並且無法保證將獲得任何此類延期。

Total liquidity was $231.6 million at quarter end and is comprised of $106.6 million of cash and cash equivalents and $125 million of available borrowing capacity under our revolving credit facility. No borrowings or letters of credit were outstanding against the revolver as of March 31. In addition, no principal payments are currently due on our senior notes nor are any payments currently due on our payable pursuant to our tax receivable agreement. Our debt to total capitalization ratio was stable at 25.2%, and our net debt to capitalization ratio after taking into account our cash balance was 21.8%.

截至季度末，流動資金總額為 2.316 億美元，包括 1.066 億美元的現金和現金等價物以及我們循環信貸額度下的 1.25 億美元的可用借款能力。截至 3 月 31 日，循環貸款沒有未償還的借款或信用證。此外，根據我們的應收稅款協議，我們的優先票據目前沒有到期的本金付款，也沒有任何應付款項。我們的債務佔總資本比率穩定在 25.2%，考慮現金餘額後的淨債務佔資本比率為 21.8%。

Now turning to our statement of operations. The company has 4 reporting segments: Valencia, San Francisco, Great Park and Commercial. Segment results are as follows: the Valencia segment recognized a $2.4 million loss for the quarter. As no land sales were closed, most of this loss was comprised of selling, general and administrative expenses of $2.6 million related to employee compensation costs as well as selling and marketing expenses in support of our active development areas and the pursuit of 2023 land sales. The San Francisco segment recognized a loss of $1 million for the quarter. This loss is comprised of general and administrative costs incurred to support the segment's continued focus on rebalancing the current entitlement between the Candlestick and Shipyard sites as well as working with the city to update the existing tax increment financing time lines. Our Great Park segment reported net income of $4.5 million for the quarter, which is comprised of $1.8 million in net income generated by our management company and net income of $2.7 million from the ventures operations.

現在轉向我們的運營聲明。該公司有 4 個報告部門：瓦倫西亞、舊金山、大公園和商業。分部業績如下：瓦倫西亞分部確認本季度虧損 240 萬美元。由於沒有關閉土地銷售，這一損失的大部分包括 260 萬美元的銷售、一般和行政費用，這些費用與員工補償成本相關，以及用於支持我們活躍的開發區和追求 2023 年土地銷售的銷售和營銷費用。舊金山分部確認本季度虧損 100 萬美元。這一損失包括為支持該部門繼續專注於重新平衡 Candlestick 和 Shipyard 場地之間的當前權利以及與市政府合作更新現有的增稅融資時間表而產生的一般和行政成本。我們的 Great Park 部門報告本季度淨收入為 450 萬美元，其中包括我們的管理公司產生的 180 萬美元淨收入和風險業務產生的 270 萬美元淨收入。

As it relates to the management company, Five Point recognized $4.1 million in management fee revenues during the quarter, $3 million of which was from monthly base fee payments and $1.1 million of noncash incentive compensation recognized as services performed for our development management agreement. Incentive compensation will be paid as future distributions are made from the venture. Offsetting these revenues were expenses of $2.4 million comprised of $1.7 million for the cost of providing management services, primarily project team compensation costs as well as $600,000 of amortization expense associated with our development management agreement intangible asset.

由於與管理公司有關，Five Point 在本季度確認了 410 萬美元的管理費收入，其中 300 萬美元來自每月基本費用支付和 110 萬美元的非現金激勵補償，確認為為我們的開發管理協議提供的服務。未來的分配將從合資企業中獲得，將支付激勵補償。抵消這些收入的是 240 萬美元的費用，其中包括 170 萬美元的提供管理服務成本，主要是項目團隊薪酬成本，以及與我們的開發管理協議無形資產相關的 600,000 美元攤銷費用。

The ventured operations recognized revenue of $8.6 million during the quarter. This is mostly comprised of changes in estimates of variable consideration from the amounts previously reported on prior land sales, including profit participation that the venture collects from our homebuilders. Offsetting these revenues were selling, general and administrative expenses of $3.3 million and related party management fee expense of $4.5 million. We own 37.5% -- we own 37.5 of the percent interest of the Great Park Venture and 100% of the management company. Although the Great Park segment reports the full results of the Great Park Venture, our investment is reported under the equity method of accounting, and therefore, the assets, liabilities, results of operations and cash flows of the venture are not consolidated within our financial statements. The company's equity and earnings in the Great Park Venture after adjusting for a minor investment basis difference was $1.2 million for the quarter. The Great Park Venture is a self-funding operation with no debt and had a cash balance of $144 million at the end of the quarter.

風險業務在本季度確認了 860 萬美元的收入。這主要包括對先前土地銷售報告金額的可變對價估計的變化，包括該企業從我們的房屋建築商那裡收取的利潤參與。抵消這些收入的是 330 萬美元的銷售、一般和管理費用以及 450 萬美元的關聯方管理費用。我們擁有 37.5%——我們擁有 Great Park Venture 37.5% 的權益和管理公司 100% 的權益。儘管 Great Park 分部報告了 Great Park Venture 的全部業績，但我們的投資是根據權益會計法報告的，因此，該合資企業的資產、負債、經營成果和現金流量並未合併到我們的財務報表中.該公司本季度在 Great Park Venture 的股權和收益在針對較小的投資基礎差異進行調整後為 120 萬美元。 Great Park Venture 是一家自籌資金的公司，沒有債務，本季度末現金餘額為 1.44 億美元。

Lastly, our Commercial segment had a net loss of approximately $200,000 for the quarter. The Venture is self-funding operation and had a cash balance of $5 million at the end of the quarter. As a reminder, we own 75% of the Gateway Commercial Venture. Our Investment in the venture is reported under the equity method of accounting, and therefore, the assets, liabilities, cash flows and results of operations of the venture are not consolidated within our financial statements. Five Point's equity and loss for the quarter from the Gateway Commercial Venture was approximately $200,000.

最後，我們的商業部門本季度淨虧損約為 200,000 美元。 Venture 是自籌資金運營，本季度末現金餘額為 500 萬美元。提醒一下，我們擁有 Gateway Commercial Venture 75% 的股份。我們對合資企業的投資採用權益會計法進行報告，因此，該合資企業的資產、負債、現金流量和經營成果並未合併到我們的財務報表中。 Five Point 本季度來自 Gateway Commercial Venture 的股本和虧損約為 200,000 美元。

With that, I'll turn it over to the operator for questions.

有了這個，我會把它交給接線員提問。

(Operator Instructions) Our first question is from (inaudible).

（操作員說明）我們的第一個問題來自（聽不清）。

Nationally, we're seeing new home prices down anywhere from 5% to 20% based on what homebuilders are telling us from the peak last year, which would, of course imply a hit to residual land values. And I understand you guys can be more patient in terms of waiting for a stronger market to (inaudible). Question is, what kind of pressure are you seeing in your communities on pricing? And are you holding firm at peak prices for lot values?

在全國范圍內，根據房屋建築商從去年的峰值告訴我們的情況，我們看到新房價格下降了 5% 到 20%，這當然意味著剩餘土地價值受到打擊。我知道你們在等待更強勁的市場（聽不清）方面可以更有耐心。問題是，您在社區中看到什麼樣的定價壓力？您是否堅守地段價值的最高價位？

Jesse, each of the builders get to price their own homes. And I actually, today was actually looking at some of the sales over the last week because I was kind of somewhat curious what you're saying. And the thing that surprised me is how little concessions are being given to sell homes, especially at the Great Park. I think what -- the -- we've had that conversation many times about pricing, at least in California, it weakens first in the inland and then it moves towards the coast and it recovers first in the coast and moves out. And while the builders are definitely pricing to meet the market, a lot of that actually occurred in January and prices have been coming up again.

傑西，每個建築商都可以為自己的房屋定價。事實上，我今天實際上是在查看上週的一些銷售情況，因為我有點好奇你在說什麼。令我感到驚訝的是，出售房屋的優惠很少，尤其是在 Great Park。我認為 - 我們已經就定價進行過多次討論，至少在加利福尼亞州，它首先在內陸減弱，然後向海岸移動，然後首先在海岸恢復並向外移動。雖然建築商的定價肯定是為了滿足市場需求，但實際上很多都是在 1 月份發生的，價格又開始上漲了。

So at this point -- and the builders, as you can tell from the -- we've had over like a 125% increase in sales from Q4 to Q1. So as you can see, there is still a lot of interest in our Irvine market. And so when I look at the pricing there, everyone kind of was meeting the market in January. But today, they're really actually starting to raise prices again because there's so much demand in the market. In Valencia, we've seen more increase there. The biggest challenge we have there is that the limited inventory that we have. We don't have it across all price points. So we have fewer sales there. But once again, there's not so much -- there's still obviously some concessions in the market without a doubt, but we're not seeing a whole lot of downward pressure at this moment on prices. I think whatever pressure there was, it's already occurred. And let's say, really -- we really saw most of it in January. And now we actually have builders that have raised prices phase-over phase in some of the new releases.

所以在這一點上——以及建築商，你可以從中看出——從第四季度到第一季度，我們的銷售額增長了 125%。所以正如你所看到的，我們的爾灣市場仍然有很多興趣。因此，當我查看那裡的定價時，每個人都在 1 月份與市場會面。但今天，他們真的又開始提價了，因為市場上的需求量太大了。在瓦倫西亞，我們看到那裡的增長更多。我們在那裡面臨的最大挑戰是我們的庫存有限。我們沒有在所有價位上都有它。所以我們在那裡的銷售額較少。但再一次，沒有那麼多——毫無疑問，市場顯然仍有一些讓步，但我們目前沒有看到價格面臨很大的下行壓力。我認為無論有什麼壓力，它已經發生了。可以說，真的——我們真的在一月份看到了其中的大部分內容。現在我們實際上有一些建築商在一些新版本中提高了價格。

So once again, we're in a very unique market in California, really truly supply constrained. And the buyers are solely adjusting to interest rates, and we're seeing that kind of increase in sales and so from the standpoint of going to land, your question on land, we actually are seeing -- we've really gotten back into the conversation with builders again, especially this month. And we're actually seeing land prices consistent with what we were selling for a couple of years ago.

因此，我們又一次處於加利福尼亞州一個非常獨特的市場，真正真正的供應受限。買家只是根據利率進行調整，我們看到了這種銷售增長，所以從登陸的角度來看，你關於陸地的問題，我們實際上看到了——我們真的回到了再次與建築商對話，尤其是這個月。我們實際上看到的土地價格與我們幾年前的銷售價格一致。

Got it. So -- but how does -- so I guess a follow-up on that is with no land sales in the first quarter, you talked about you're in active negotiation now and you expect some imminent sales in the next quarter or so. Is the gap now -- is that kind of because homebuilders were sitting on the sidelines kind of waiting to see how resilient and how sustainable the demand would be? Or was the gap with no land sales in the first quarter and with builders pulling back? Was that more so just a wide bid-ask (inaudible) pricing where you were maybe holding firm at peak a lot values and they were looking to get some of the deal?

知道了。所以 - 但如何 - 所以我猜這是第一季度沒有土地銷售的後續行動，你談到你現在正在積極談判，你預計下個季度左右會有一些即將到來的銷售。現在的差距 - 是因為房屋建築商坐在場邊等著看需求的彈性和可持續性嗎？或者是第一季度沒有土地銷售和建築商撤退的差距？這是否更像是一個廣泛的買賣（聽不清）定價，你可能在峰值時持有堅挺的價格，而他們希望獲得一些交易？

It really -- the builders really got out of the land business in Q4. And so the -- and so obviously, to close something, you got to have an escrow beforehand the whole process. And they were all really -- I think they're all looking to see what would happen in the market, what would happen in sales. And as I've said, literally, there's 400 homes available in our Irvine communities. And so we're now in a situation where they were on the sidelines and they're waiting to see what was going on. And now we are literally competitively bidding and builders are actually raising their bids as we go back and say, sorry, you didn't get it, or wait a minute, let me try again. So there really was a true movement to be on the sidelines, especially in December and January and even February. But it is really clear to us that builders are coming back now. And we've -- what we're sending out to market, we're getting 4 and 5 builders bidding on it.

真的——建築商在第四季度真的退出了土地業務。所以 - 很明顯，要關閉某些東西，你必須在整個過程之前進行託管。他們都真的——我認為他們都在看市場會發生什麼，銷售會發生什麼。正如我所說，從字面上看，我們爾灣社區有 400 套住房。所以我們現在處於他們處於觀望狀態，他們在等著看發生了什麼。現在我們實際上是在競標，而建築商實際上在提高他們的出價，因為我們回去說，對不起，你沒有明白，或者等一下，讓我再試一次。所以真的有一個真正的觀望運動，尤其是在 12 月、1 月甚至 2 月。但我們非常清楚，建築商現在正在回歸。我們已經 - 我們正在向市場發送的東西，我們有 4 家和 5 家建築商競標。

Got it. That's really helpful. Can you just talk a little bit about what you're seeing on the cost on the development side?

知道了。這真的很有幫助。你能談談你在開發方面看到的成本嗎？

Well, on the land development side, we have had a lot of our land ready to go. We had just one small underground job. We actually rebid it and we saved $0.5 million. So on the land development side, we're seeing those costs go down also. Now we don't have a lot of active construction right now because of where we were in our inventory cycle. But that was one small thing we needed to complete it and decided to rebid it. And we -- that was a meaningful reduction in the cost. So we're actually feeling pretty good about land development costs at this moment that certainly, they're off of their peak.

好吧，在土地開發方面，我們已經準備好了很多土地。我們只有一份小小的地下工作。實際上，我們重新出價，節省了 50 萬美元。因此，在土地開發方面，我們看到這些成本也在下降。由於我們處於庫存週期中的位置，現在我們現在沒有很多活躍的建設。但這是一件小事，我們需要完成它並決定重新投標。而我們 - 這是一個有意義的成本降低。因此，目前我們實際上對土地開發成本感覺非常好，當然，它們已經脫離了峰值。

Our next question comes from (inaudible).

我們的下一個問題來自（聽不清）。

You have a bond maturity in 2025. And I assume you want to get your balance sheet in a certain spot in advance of that refinancing exercise. I was just curious if you could comment on where you want your balance sheet to be specifically in advance of that bond maturity to give the company the best execution around that refi.

你的債券在 2025 年到期。我假設你想在再融資之前將你的資產負債表放在某個特定位置。我只是想知道你是否可以評論一下你希望你的資產負債表在債券到期之前具體在哪裡，以便為公司提供圍繞再融資的最佳執行。

I appreciate your question, and we definitely know that we have that bond maturity coming. But I don't think we actually have sat around and said we need to have a particular -- being a particular spot on what we're looking for our balance sheet. We don't have a specific target because there are so many factors that are going to play into it over the next couple of years. So I mean, I'm struggling because I would love to be able to give you really a fine line answer, but it really is going to be -- so many things are going to be market-dependent. And we haven't set a particular number, but we're really -- one of the things we're focused on is maximizing our cash position. And we know that we're going to be able to make strong progress in that over the next couple of years. So I guess maybe that's the best answer I'd give you right now is that we know it's there, and we're really focused on our cash position, and that's one of the reason we start the call talking about, we're really looking at cash. So I hope that helps you a little bit.

我很欣賞你的問題，我們肯定知道我們的債券即將到期。但我認為我們實際上並沒有坐下來說我們需要有一個特定的 - 在我們正在尋找的資產負債表上有一個特定的位置。我們沒有具體的目標，因為在接下來的幾年裡有很多因素會影響到它。所以我的意思是，我很掙扎，因為我很想給你一個很好的答案，但它真的會——很多事情都將取決於市場。我們還沒有設定一個特定的數字，但我們真的——我們關注的事情之一就是最大化我們的現金頭寸。我們知道，在接下來的幾年裡，我們將能夠在這方面取得重大進展。所以我想也許我現在給你的最好答案是我們知道它在那裡，我們真的專注於我們的現金頭寸，這就是我們開始通話的原因之一，我們真的看著現金。所以我希望這對你有一點幫助。

No. I mean, look, that's very helpful. I appreciate. You don't want to give too much in the way of specifics. Thank you.

不，我的意思是，看，這很有幫助。我很感激。你不想在細節方面給出太多。謝謝。

All right. There are no further questions at this time. I would like to turn the floor back to Dan Hedigan for closing comments.

好的。目前沒有其他問題。我想將發言權轉回給 Dan Hedigan 以發表結束評論。

Thank you. On behalf of our management team, we thank you for joining us on today's call, and we look forward to speaking with you next quarter.

謝謝。我們代表我們的管理團隊感謝您參加今天的電話會議，我們期待下個季度與您交談。

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

今天的電話會議到此結束。此時您可以斷開線路。感謝您的參與。