UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2021~~March 31, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission file number: 1-10466

The St. Joe Company

(Exact name of registrant as specified in its charter)


Florida	59-0432511
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

130 Richard Jackson Boulevard, Suite 200
Panama City Beach, Florida	32407
(Address of principal executive offices)	(Zip Code)

(850) 231-6400

(Registrant’s telephone number, including area code)

Securities Registered Pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Exchange on Which Registered
Common Stock, no par value	JOE	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ☑ NO ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YES ☑ NO ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐☑	Accelerated filer	☑☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☑

As of ~~October~~April 25, ~~2021,~~2022, there were ~~58,882,549~~58,912,504 shares of common stock, no par value, outstanding.

Table of Contents

THE ST. JOE COMPANY

INDEX


	Page No.
PART I
Item 1. Financial Statements (Unaudited)	3
Condensed Consolidated Balance Sheets - ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021	3
Condensed Consolidated Statements of Income - Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~	5
Condensed Consolidated Statements of Comprehensive Income - Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~	6
Condensed Consolidated Statements of Changes in Stockholders’ Equity - Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~	7
Condensed Consolidated Statements of Cash Flows - ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~	98
Notes to the Condensed Consolidated Financial Statements	1110
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	4943
Item 3. Quantitative and Qualitative Disclosures About Market Risk	7968
Item 4. Controls and Procedures	8068
PART II
Item 1. Legal Proceedings	8068
Item 1A. Risk Factors	8069
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	8069
Item 3. Defaults Upon Senior Securities	8069
Item 4. Mine Safety Disclosures	8169
Item 5. Other Information	8169
Item 6. Exhibits	8169
SIGNATURES	8270

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

THE ST. JOE COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

(Unaudited)


	September 30,		December 31,		March 31,		December 31,
	2021		2020		2022		2021
ASSETS
Investment in real estate, net	$	647,874	$	551,653	$	741,455	$	690,113
Investment in unconsolidated joint ventures		50,766		37,965		52,622		52,027
Cash and cash equivalents		27,260		106,794		33,115		70,162
Investments - debt securities		102,986		48,051		118,173		88,956
Other assets		69,897		65,866		69,875		70,235
Property and equipment, net of accumulated depreciation of $62,548 and $60,433 at September 30, 2021 and December 31, 2020, respectively		32,291		20,846
Property and equipment, net of accumulated depreciation of $66,009 and $64,251 as of March 31, 2022 and December 31, 2021, respectively						35,974		31,145
Investments held by special purpose entities		205,476		206,149		205,131		205,513
Total assets	$	1,136,550	$	1,037,324	$	1,256,345	$	1,208,151
LIABILITIES AND EQUITY
Liabilities:
Debt, net	$	196,099	$	158,915	$	256,763	$	223,034
Other liabilities		91,758		72,035		67,799		67,985
Deferred revenue						37,368		36,207
Deferred tax liabilities, net		72,580		60,915		79,746		77,259
Senior Notes held by special purpose entity		177,495		177,289		177,637		177,566
Total liabilities		537,932		469,154		619,313		582,051

Commitments and contingencies (Note 18)
Commitments and contingencies (Note 19)

Equity:
Common stock, 0 par value; 180,000,000 shares authorized; 58,882,549 issued and outstanding at September 30, 2021 and December 31, 2020		296,873		296,873
Common stock, 0 par value; 180,000,000 shares authorized; 58,908,143 and 58,882,549 issued and outstanding at March 31, 2022 and December 31, 2021, respectively						296,915		296,873
Retained earnings		283,699		255,216		318,448		310,925
Accumulated other comprehensive loss		(880)		(1,472)
Accumulated other comprehensive income (loss)						920		(389)
Total stockholders’ equity		579,692		550,617		616,283		607,409
Non-controlling interest		18,926		17,553		20,749		18,691
Total equity		598,618		568,170		637,032		626,100
Total liabilities and equity	$	1,136,550	$	1,037,324	$	1,256,345	$	1,208,151

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

THE ST. JOE COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)

(Unaudited)

The following presents the portion of the condensed consolidated balances attributable to the Company’s consolidated joint ventures, which, as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, include the Pier Park North joint venture (“Pier Park North JV”), Pier Park Crossings LLC (“Pier Park Crossings JV”), Origins Crossings, LLC (“Watersound Origins Crossings JV”), SJWCSL, LLC (“Watercrest JV”), Watersound Closings & Escrow, LLC (“Watersound Closings JV”), Pier Park Crossings Phase II LLC (“Pier Park Crossings Phase II JV”), Pier Park Resort Hotel, LLC (“Pier Park Resort Hotel JV”), the 30A Greenway Hotel, LLC (“The Lodge 30A JV”), Panama City Timber Finance Company, LLC and Northwest Florida Timber Finance, LLC. As of March 31, 2022, condensed consolidated balances attributable to the Company’s consolidated joint ventures also includes Mexico Beach Crossings, LLC ~~as discussed in~~(“Mexico Beach Crossings JV”). See Note 2. Summary of Significant Accounting Policies. Basis of Presentation and Principles of Consolidation. and Note 4. Joint Ventures for additional information. The following assets may only be used to settle obligations of the consolidated joint ventures and the following liabilities are only obligations of the joint ventures and do not have recourse to the general credit of the Company, except for covenants and guarantees discussed in Note 10. Debt, Net.

September 30,

December 31,

2021

2020
ASSETS




Investment in real estate

$
190,454

$
170,853
Cash and cash equivalents

4,420

2,639
Other assets

17,214

13,821
Investments held by special purpose entities

205,476

206,149
Total assets

$
417,564

$
393,462
LIABILITIES




Debt, net

$
155,131

$
139,592
Other liabilities

12,803

9,596
Senior Notes held by special purpose entity

177,495

177,289
Total liabilities

$
345,429

$
326,477


	March 31,		December 31,
	2022		2021
ASSETS
Investment in real estate	$	222,582	$	206,565
Cash and cash equivalents		5,458		10,564
Other assets		21,366		17,392
Investments held by special purpose entities		205,131		205,513
Total assets	$	454,537	$	440,034
LIABILITIES
Debt, net	$	190,878	$	173,531
Other liabilities		12,941		17,602
Deferred revenue		312		234
Senior Notes held by special purpose entity		177,637		177,566
Total liabilities	$	381,768	$	368,933

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

THE ST. JOE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Dollars in thousands except per share amounts)

(Unaudited)


	Three Months Ended				Nine Months Ended				Three Months Ended
	September 30,				September 30,				March 31,
	2021		2020		2021		2020		2022		2021
Revenue:
Real estate revenue	$	23,500	$	18,476	$	85,615	$	41,838	$	36,774	$	21,053
Hospitality revenue		22,292		17,005		57,986		35,180		16,321		13,067
Leasing revenue		7,146		4,963		19,112		14,169		8,822		5,594
Timber revenue		1,058		1,597		4,827		5,508		2,954		1,591
Total revenue		53,996		42,041		167,540		96,695		64,871		41,305
Expenses:
Cost of real estate revenue		8,471		9,368		33,067		18,412		15,295		10,544
Cost of hospitality revenue		16,536		10,973		43,469		26,534		14,868		11,495
Cost of leasing revenue		3,106		2,047		8,297		3,972		3,652		2,664
Cost of timber revenue		118		212		502		603		150		141
Other operating and corporate expenses		4,987		5,113		17,161		16,975
Corporate and other operating expenses										5,656		7,069
Depreciation, depletion and amortization		4,617		3,303		12,594		9,394		5,026		3,853
Total expenses		37,835		31,016		115,090		75,890		44,647		35,766
Operating income		16,161		11,025		52,450		20,805		20,224		5,539
Other income (expense):
Investment income, net		2,331		2,405		4,813		2,851		2,300		1,195
Interest expense		(4,114)		(3,379)		(11,639)		(10,113)		(4,153)		(3,671)
Gain on contribution to equity method investment		—		—		3,290		19,615
Other income, net		7,329		267		9,595		661
Total other income (expense), net		5,546		(707)		6,059		13,014
Income before equity in loss from unconsolidated affiliates and income taxes		21,707		10,318		58,509		33,819
Equity in loss from unconsolidated affiliates		(501)		(95)		(1,570)		(301)
Gain on contributions to unconsolidated joint ventures										482		120
Other (expense) income, net										(369)		1,294
Total other expense, net										(1,740)		(1,062)
Income before equity in loss from unconsolidated joint ventures and income taxes										18,484		4,477
Equity in loss from unconsolidated joint ventures										(495)		(468)
Income tax expense		(6,429)		(2,441)		(15,180)		(7,852)		(4,536)		(1,052)
Net income		14,777		7,782		41,759		25,666		13,453		2,957
Net loss (income) attributable to non-controlling interest		419		(31)		857		(249)
Net (income) loss attributable to non-controlling interest										(41)		239
Net income attributable to the Company	$	15,196	$	7,751	$	42,616	$	25,417	$	13,412	$	3,196

NET INCOME PER SHARE
Basic and Diluted
Weighted average shares outstanding		58,882,549		58,882,549		58,882,549		59,052,613
Net income per share attributable to the Company	$	0.26	$	0.13	$	0.72	$	0.43
NET INCOME PER SHARE ATTRIBUTABLE TO THE COMPANY
Basic									$	0.23	$	0.05
Diluted									$	0.23	$	0.05

WEIGHTED AVERAGE SHARES OUTSTANDING
Basic										58,882,549		58,882,549
Diluted										58,886,931		58,882,549

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

THE ST. JOE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Dollars in thousands)

(Unaudited)


	Three Months Ended				Nine Months Ended				Three Months Ended
	September 30,				September 30,				March 31,
	2021		2020		2021		2020		2022		2021
Net income:	$	14,777	$	7,782	$	41,759	$	25,666	$	13,453	$	2,957
Other comprehensive income (loss):
Net unrealized gain (loss) on available-for-sale investments		3		21		(1)		127
Net unrealized gain on restricted investments		—		2		—		7
Interest rate swap		301		1		410		(865)
Interest rate swap - unconsolidated affiliate		(1)		(2)		133		(843)
Other comprehensive (loss) income:
Net unrealized loss on available-for-sale investments										(322)		(2)
Interest rate swaps										2,308		157
Interest rate swap - unconsolidated joint venture										313		211
Reclassification of net realized loss (gain) included in earnings		154		—		251		(4)		147		(15)
Total before income taxes		457		22		793		(1,578)		2,446		351
Income tax (expense) benefit		(116)		(5)		(201)		400
Total other comprehensive income (loss), net of tax		341		17		592		(1,178)
Income tax expense										(445)		(89)
Total other comprehensive income, net of tax										2,001		262
Total comprehensive income, net of tax		15,118		7,799		42,351		24,488		15,454		3,219
Total comprehensive loss (income) attributable to non-controlling interest		419		(31)		857		(249)
Total comprehensive (income) loss attributable to non-controlling interest										(733)		239
Total comprehensive income attributable to the Company	$	15,537	$	7,768	$	43,208	$	24,239	$	14,721	$	3,458

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

~~THE ST. JOE COMPANY~~

~~CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY~~

~~(Dollars in thousands)~~

~~(Unaudited)~~

Accumulated









Common Stock

Other

Outstanding

Retained

Comprehensive

Treasury

Non-controlling


Shares


Amount


Earnings


(Loss) Income


Stock


Interest


Total
Balance at June 30, 2021

58,882,549

$
296,873

$
273,214

$
(1,221)

$
—

$
19,649

$
588,515
Capital distribution to non-controlling interest

—

—

—

—

—

(304)

(304)
Dividends ($0.08 per share)

—

—

(4,711)

—

—

—

(4,711)
Other comprehensive income, net of tax

—

—

—

341

—

—

341
Net income

—

—

15,196

—

—

(419)

14,777
Balance at September 30, 2021

58,882,549

$
296,873

$
283,699

$
(880)

$
—

$
18,926

$
598,618

Accumulated









Common Stock

Other

Outstanding

Retained

Comprehensive

Treasury

Non-controlling


Shares


Amount


Earnings


(Loss) Income


Stock


Interest


Total
Balance at June 30, 2020

58,882,549

$
305,676

$
231,801

$
(1,530)

$
(8,803)

$
15,506

$
542,650
Capital contribution from non-controlling interest

—

—

—

—

—

2,357

2,357
Capital distribution to non-controlling interest

—

—

—

—

—

(386)

(386)
Other comprehensive income, net of tax

—

—

—

17

—

—

17
Net income

—

—

7,751

—

—

31

7,782
Balance at September 30, 2020

58,882,549

$
305,676

$
239,552

$
(1,513)

$
(8,803)

$
17,508

$
552,420

~~See accompanying notes to the condensed consolidated financial statements.~~

~~Table of Contents~~

THE ST. JOE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Dollars in thousands)

(Unaudited)



	Common Stock						Accumulated Other							Common Stock						Accumulated Other
	Outstanding				Retained		Comprehensive		Treasury		Non-controlling			Outstanding				Retained		Comprehensive		Non-controlling
	Shares		Amount		Earnings		(Loss) Income		Stock		Interest		Total	Shares		Amount		Earnings		(Loss) Income		Interest		Total
Balance at December 31, 2020	58,882,549	$	296,873	$	255,216	$	(1,472)	$	—	$	17,553	$	568,170
Capital contribution from non-controlling interest	—		—		—		—		—		3,188		3,188
Capital distribution to non-controlling interest	—		—		—		—		—		(958)		(958)
Dividends ($0.24 per share)	—		—		(14,133)		—		—		—		(14,133)
Balance at December 31, 2021														58,882,549	$	296,873	$	310,925	$	(389)	$	18,691	$	626,100
Capital contributions from non-controlling interest														—		—		—		—		2,035		2,035
Capital distributions to non-controlling interest														—		—		—		—		(710)		(710)
Issuance of restricted stock														25,594		—		—		—		—		—
Stock based compensation expense														—		42		—		—		—		42
Dividends ($0.10 per share)														—		—		(5,889)		—		—		(5,889)
Other comprehensive income, net of tax	—		—		—		592		—		—		592	—		—		—		1,309		692		2,001
Net income	—		—		42,616		—		—		(857)		41,759	—		—		13,412		—		41		13,453
Balance at September 30, 2021	58,882,549	$	296,873	$	283,699	$	(880)	$	—	$	18,926	$	598,618
Balance at March 31, 2022														58,908,143	$	296,915	$	318,448	$	920	$	20,749	$	637,032

Common Stock

Accumulated Other

Outstanding

Retained

Comprehensive

Treasury

Non-controlling


Shares


Amount


Earnings


Loss


Stock


Interest


Total
Balance at December 31, 2019

59,414,583

$
305,631

$
214,225

$
(335)

$
—

$
10,149

$
529,670
Capital contribution from non-controlling interest

—

—

—

—

—

7,496

7,496
Capital distribution to non-controlling interest

—

—

—

—

—

(386)

(386)
Stock based compensation expense

—

45

—

—

—

—

45
Repurchase of common shares

(532,034)

—

—

—

(8,803)

—

(8,803)
Adoption of ASU 2016-13 Financial Instruments - Credit Losses, net of tax

—

—

(90)

—

—

—

(90)
Other comprehensive loss, net of tax

—

—

—

(1,178)

—

—

(1,178)
Net income

—

—

25,417

—

—

249

25,666
Balance at September 30, 2020

58,882,549

$
305,676

$
239,552

$
(1,513)

$
(8,803)

$
17,508

$
552,420



	Common Stock						Accumulated Other
	Outstanding				Retained		Comprehensive		Non-controlling
	Shares		Amount		Earnings		(Loss) Income		Interest		Total
Balance at December 31, 2020	58,882,549	$	296,873	$	255,216	$	(1,472)	$	17,553	$	568,170
Capital contributions from non-controlling interest	—		—		—		—		1,745		1,745
Capital distributions to non-controlling interest	—		—		—		—		(319)		(319)
Dividends ($0.08 per share)	—		—		(4,711)		—		—		(4,711)
Other comprehensive income, net of tax	—		—		—		262		—		262
Net income	—		—		3,196		—		(239)		2,957
Balance at March 31, 2021	58,882,549	$	296,873	$	253,701	$	(1,210)	$	18,740	$	568,104

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

THE ST. JOE COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

(Unaudited)


	Nine Months Ended				Three Months Ended
	September 30,				March 31,
	2021		2020		2022		2021
Cash flows from operating activities:
Net income	$	41,759	$	25,666	$	13,453	$	2,957
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization		12,594		9,394		5,026		3,853
Stock based compensation		—		45		42		—
(Gain) loss on sale of investments		(17)		48
Unrealized loss on investments, net		1,947		4,633
Equity in loss from unconsolidated affiliates, net of distributions		1,770		301
Gain on sale of investments						—		(17)
Unrealized (gain) loss on investments, net						(25)		1,049
Equity in loss from unconsolidated joint ventures, net of distributions						528		468
Deferred income tax expense		11,464		7,745		2,042		268
Cost of real estate sold		30,105		17,898		14,064		9,839
Expenditures for and acquisition of real estate to be sold		(28,288)		(24,306)		(25,937)		(12,038)
Accretion income and other		(614)		(706)		(259)		(188)
Loss on disposal of property and equipment		270		38
Gain on contribution to equity method investment		(3,290)		(19,615)
Gain on disposal of property and equipment						(10)		—
Gain on contributions to unconsolidated joint ventures						(482)		(120)
Gain on insurance for damage to property and equipment, net		(3,924)		—		(723)		(866)
Changes in operating assets and liabilities:
Other assets		(6,069)		(4,926)		8,427		816
Deferred revenue						1,133		2,009
Other liabilities		7,543		5,791		2,534		1,798
Income taxes receivable		(117)		541
Net cash provided by operating activities		65,133		22,547		19,813		9,828
Cash flows from investing activities:
Expenditures for operating property		(109,215)		(91,170)		(51,633)		(24,319)
Expenditures for property and equipment		(3,135)		(4,231)		(1,440)		(803)
Proceeds from the disposition of assets		34		7		10		—
Proceeds from insurance claims		3,924		—		723		866
Purchases of investments - debt securities		(127,958)		(58,912)		(74,476)		(84,971)
Purchases of restricted investments		—		(20)
Maturities of investments - debt securities		73,000		9,000		45,000		39,000
Sales of investments - debt securities		36		—		—		36
Sales of investments - equity securities		325		2,502		—		9
Sales of restricted investments		1,173		1,211		—		1,173
Capital contributions to unconsolidated joint ventures						(142)		(2,500)
Capital distributions from unconsolidated joint ventures						206		—
Maturities of assets held by special purpose entities		788		787		413		416
Net cash used in investing activities		(161,028)		(140,826)		(81,339)		(71,093)
Cash flows from financing activities:
Capital contribution from non-controlling interests		3,188		5,139
Capital distribution to non-controlling interests		(958)		(386)
Capital contribution to unconsolidated affiliates		(9,708)		(8,980)
Repurchase of common shares		—		(8,803)
Capital contributions from non-controlling interest						2,035		1,745
Capital distributions to non-controlling interest						(710)		(319)
Dividends paid		(14,133)		—		(5,889)		(4,711)
Borrowings on debt		39,812		53,105		35,168		11,343
Principal payments for debt		(1,536)		(1,469)		(536)		(449)
Principal payments under finance lease obligation		(75)		(38)
Principal payments for finance leases						(35)		(21)
Debt issuance costs		(1,087)		(1,480)		(1,105)		(540)
Net cash provided by financing activities		15,503		37,088		28,928		7,048
Net decrease in cash, cash equivalents and restricted cash		(80,392)		(81,191)		(32,598)		(54,217)
Cash, cash equivalents and restricted cash at beginning of the period		110,119		188,677		74,400		110,119
Cash, cash equivalents and restricted cash at end of the period	$	29,727	$	107,486	$	41,802	$	55,902

See accompanying notes to the condensed consolidated financial statements.

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THE ST. JOE COMPANY

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

(Dollars in thousands)

(Unaudited)

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the amounts shown in the condensed consolidated statements of cash flows.



	September 30,		September 30,		March 31,		March 31,
	2021		2020		2022		2021
Cash and cash equivalents	$	27,260	$	102,351	$	33,115	$	52,313
Restricted cash included in other assets		2,467		5,135		8,687		3,589
Total cash, cash equivalents and restricted cash shown in the accompanying condensed consolidated statements of cash flows	$	29,727	$	107,486	$	41,802	$	55,902

Restricted cash includes amounts reserved as a requirement of financing and development for certain of the Company’s projects.


	Nine Months Ended				Three Months Ended
	September 30,				March 31,
		2021	2020			2022	2021
Cash paid during the period for:
Interest, net of amounts capitalized	$	11,949	$	11,637	$	5,692	$	5,207
Income taxes	$	6,570	$	—	$	—	$	—

Non-cash financing and investment activities:
Non-cash capital contribution from non-controlling interest	$	—	$	2,359
Non-cash contribution to equity method investment	$	(4,616)	$	(22,594)
Non-cash investing and financing activities:
Non-cash contributions to unconsolidated joint ventures					$	(831)	$	(574)
Decrease in Community Development District debt	$	(800)	$	(384)	$	(15)	$	(2)
Transfers of operating property to property and equipment	$	12,711	$	—	$	4,960	$	7,092
Increase in expenditures for operating properties and property and equipment financed through accounts payable	$	10,277	$	2,584
Increase (decrease) in expenditures for operating properties and property and equipment financed through accounts payable					$	1,070	$	(551)
Unrealized gain on cash flow hedges					$	2,621	$	368

See notes to the condensed consolidated financial statements.

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THE ST. JOE COMPANY

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, unless otherwise stated)

(Unaudited)

1. Nature of Operations

The St. Joe Company together with its consolidated subsidiaries (“St. Joe” or the “Company”) is a Florida real estate development, asset management and operating company with all of its real estate assets and operations in Northwest Florida. Approximately 86% of the Company’s real estate is located in Florida’s Bay, Gulf, and Walton counties. Approximately 90% of the Company’s real estate land holdings are located within 15 miles of the Gulf of Mexico.

The Company conducts primarily all of its business in the following 3 reportable segments: 1) residential, 2) hospitality and 3) commercial. See Note ~~17.~~18. Segment Information.

2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for reporting on Form 10-Q. Accordingly, certain information and footnotes required by United States generally accepted accounting principles (“GAAP”) for complete financial statements are not included herein. The unaudited interim condensed consolidated financial statements include the accounts of the Company and all of its majority-owned and controlled subsidiaries, voting interest entities where the Company has a majority voting interest or control and variable interest entities where the Company deems itself the primary beneficiary. Investments in joint ventures (“JV”) and limited partnerships in which the Company is not the primary beneficiary, or a voting interest entity where the Company does not have a majority voting interest or control, are accounted for by the equity method. All significant intercompany transactions and balances have been eliminated in consolidation. The December 31, ~~2020~~2021 condensed consolidated balance sheet amounts have been derived from the Company’s December 31, ~~2020~~2021 audited consolidated financial statements. Certain prior period amounts in the accompanying condensed consolidated financial statements have been reclassified to conform to the current year presentation. These reclassifications had no effect on the Company’s previously reported total assets and liabilities, stockholders’ equity or net income. Operating results for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 are not necessarily indicative of the results that may be expected for the full year ending December 31, ~~2021.~~2022.

A variable interest entity (“VIE”) is an entity in which a controlling financial interest may be achieved through arrangements that do not involve voting interests. A VIE is required to be consolidated by its primary beneficiary, which is the entity that possesses the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and has the obligation to absorb losses or the right to receive benefits from the VIE that are significant to the ~~entity.~~VIE. The Company consolidates VIEs when it is the primary beneficiary of the VIE, including real estate JVs determined to be VIEs. The Company continues to ~~assess~~evaluate whether it is the primary beneficiary ~~on an ongoing basis.~~as needed when assessing reconsideration events. See Note 4. Joint Ventures.

The unaudited interim condensed consolidated financial statements reflect all normal recurring adjustments that, in the opinion of management, are necessary for fair presentation of the information contained herein. The unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021. The Company adheres to the same accounting policies in preparation of its unaudited interim condensed consolidated financial statements as the Company’s December 31, ~~2020~~2021 annual financial statements, except for any recently adopted accounting ~~pronouncements detailed below.~~pronouncements. As required under GAAP, interim accounting for certain expenses, including income taxes, are based on full year assumptions. For interim financial reporting purposes, income taxes are recorded based upon estimated annual income tax rates.

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Concentration of Risks and Uncertainties

~~The~~All of the Company’s real estate investments are concentrated in Northwest Florida. Uncertain economic conditions could have an adverse impact on the Company’s ~~real estate~~operations and asset values.

~~On March 11, 2020, the World Health Organization characterized the outbreak of the novel coronavirus (“COVID-19”), as a global pandemic and recommended containment and mitigation measures.~~ The economic conditions in the United States have been negatively impacted by the continued threat byof the COVID-19 pandemic. ~~The~~While demand across each of the Company’s segments remain strong, the Company’s hospitality operations have already been, and may ~~continue to~~in the future be, disrupted by the impacts of the COVID-19 pandemic and the federal, state and local government actions to address it. ~~While~~Despite the ~~breadth~~Company’s positive financial results during the COVID-19 pandemic, the magnitude and duration of the COVID-19 pandemic impact isremains unknown itand the Company could ~~have a~~experience material ~~adverse impact on~~declines within each of its reportable segments in the ~~Company’s results of operations, cash flows and financial condition.~~future compared to historical norms.

Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash, cash equivalents, investments, other receivables, investments held by special purpose entity or entities (“SPE”) and investments in retained interests. The Company deposits and invests cash with local, regional and national financial institutions, and as of ~~September 30, 2021,~~March 31, 2022, these balances exceeded the amount of F.D.I.C. insurance provided on such deposits. In addition, as of ~~September 30, 2021~~March 31, 2022 the ~~company~~Company had ~~$9.4~~$8.9 million invested in U.S. Treasury Money Market Funds, ~~$103.0~~$118.2 million invested in U.S. Treasury Bills classified as investments – debt securities, and ~~$0.4~~$0.5 million invested in 2 issuers of preferred stock that are non-investment grade.

Earnings Per Share

Basic ~~and diluted~~ earnings per share ~~are~~is calculated by dividing net income attributable to the Company by the basic weighted average number of common shares outstanding for the period. Diluted earnings per share is calculated by dividing net income attributable to the Company by the weighted average number of shares of common ~~shares~~stock outstanding for the ~~period.~~period, including potential dilutive common shares. The treasury stock method is used to determine the effect on diluted earnings. For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022, the Company had 25,594 unvested shares of restricted stock. As of March 31, 2021, ~~and 2020,~~there were 0 outstanding common stock equivalents. For the three months ended March 31, 2021, the Company did not have any potential dilutive instruments, therefore, basic and diluted weighted average shares outstanding were equal. See Note 15. Stockholders’ Equity for additional information related to the issuance of common stock for employee compensation.

The computation of basic and diluted earnings per share shares are as follows:


	Three Months Ended March 31,
	2022		2021

	(Dollars in thousands except per share amounts)
Income
Net income attributable to the Company	$	13,412	$	3,196

Shares
Weighted-average shares outstanding - basic		58,882,549		58,882,549
Incremental shares from restricted stock		4,382		—
Weighted-average shares outstanding - diluted		58,886,931		58,882,549

Net income per share attributable to the Company
Basic income per share	$	0.23	$	0.05
Diluted income per share	$	0.23	$	0.05

Recently Adopted Accounting Pronouncements

~~Income Taxes~~

~~In December 2019, the FASB issued ASU 2019-12,~~ ~~Income Taxes - Simplifying the Accounting for Income Taxes~~There were no recently adopted accounting pronouncements which simplified the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendment also improved consistent application of and simplified GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The Company adopted the new guidance as of January 1, 2021. The adoption of this guidance did notwould have ~~an impact~~a material effect on the Company’s financial condition, results of operations and cash flows.

~~Investments – Equity Securities, Investments-Equity Method and Joint Ventures and Derivatives and Hedging~~

~~In January 2020, the FASB issued ASU 2020-01,~~ Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force), ~~which clarified the interaction between the accounting standard on recognition and measurement of financial instruments in Topic 321~~, ~~Investments—Equity Securities~~ ~~and Topic 323,~~~~Investments—Equity Method and Joint Ventures~~. ~~The Company adopted the new guidance as of January 1, 2021~~. ~~The adoption of this guidance did not have a material impact on the Company’s financial condition, results of operations and cash flows~~.

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~~Codification Improvements~~

~~In October 2020, the FASB issued ASU 2020-10,~~ ~~Codification Improvements~~ that improved consistency by including all disclosure guidance in the appropriate disclosure sections and clarified application of various provisions in the Codification. The Company adopted the new guidance as of January 1, 2021. The adoption of this guidance did not have an impact on the Company’s financial condition, results of operations and cash flows and did not have a material impact on the disclosures to the financial statements.

Recently Issued Accounting Pronouncements

Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting that provides temporary optional guidance to ease the potential burden in accounting for or recognizing the effects of reference rate reform on financial reporting. The new guidance provides expedients and exceptions for applying GAAP to contract modifications and hedging relationships affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference ~~LIBOR~~London Interbank Offered Rate (“LIBOR”) or another reference rate that is expected to be discontinued due to reference rate reform. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848) which clarifies the original guidance that certain optional expedients and exceptions in contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. This new guidance was effective upon issuance and may be applied prospectively through December 31, 2022, as reference rate activities occur. There is no current impact to the Company from this guidance and the Company ~~is evaluating~~will consider the impact ~~that the adoption of this guidance will have~~ on its financial condition, results of operations and cash flows if there are modifications to existing agreements.

3. Investment in Real Estate

Real estate, excluding unconsolidated JVs, by property type and segment includes the following:


	September 30,		December 31,		March 31,		December 31,
	2021		2020		2022		2021
Development property:
Residential	$	123,079	$	116,911	$	125,784	$	122,404
Hospitality		102,523		51,113		146,298		137,089
Commercial		75,400		123,389		104,553		85,931
Other		3,360		2,691		3,261		3,232
Total development property		304,362		294,104		379,896		348,656

Operating property:
Residential		13,253		13,254		13,253		13,253
Hospitality		124,427		103,687		144,857		124,449
Commercial		289,066		216,439		293,535		290,794
Other		128		129		128		127
Total operating property		426,874		333,509		451,773		428,623
Less: Accumulated depreciation		83,362		75,960		90,214		87,166
Total operating property, net		343,512		257,549		361,559		341,457
Investment in real estate, net	$	647,874	$	551,653	$	741,455	$	690,113

Development property consists of land the Company is developing or intends to develop for sale or future operations and includes direct costs associated with the land, as well as development, construction and indirect costs. Residential development property includes existing and planned residential homesites and related infrastructure. Hospitality development property consists of land, improvements and construction and development costs primarily related to uncompleted hotels, resorts, club amenities and marinas. Commercial development property primarily consists

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of land and construction and development costs for planned commercial, multi-family and industrial uses. Development property in the hospitality and commercial segments will be reclassified as operating property as it is placed into service.

Operating property includes property that the Company uses for operations and activities. Residential operating property consists primarily of residential utility assets and certain rental properties. ~~The hospitality~~Hospitality operating property primarily consists of existing hotels, resorts, clubs, ~~marinas,~~ vacation rentals and other operations. Commercial operating property includes property developed or purchased by the Company and used for retail, office, self-storage, light industrial, multi-family, senior living, commercial rental and timber purposes. Operating property may be sold in the future as part of the

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Company’s principal real estate business. As of March 31, 2022 and December 31, 2021, operating property, net related to operating leases was $228.5 million and $230.0 million, respectively.

4. Joint Ventures

The Company enters into JVs, from time to time, for the purpose of developing real estate and other business activities in which the Company may or may not have a controlling financial interest. GAAP requires consolidation of voting interest entities where the Company has a majority voting interest or control and VIEs in which an enterprise has a controlling financial interest and is the primary beneficiary. A controlling financial interest will have both of the following characteristics: (i) the power to direct the VIE activities that most significantly impact economic performance and (ii) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company examines specific criteria and uses judgment when determining whether the Company is the primary beneficiary and must consolidate a VIE. The Company continues to ~~assess~~evaluate whether it is the primary beneficiary ~~on an ongoing basis.~~as needed when assessing reconsideration events. Investments in JVs and limited partnerships in which the Company is not the primary beneficiary, or a voting interest entity where the Company does not have a majority voting interest or control, are accounted for by the equity method.

The timing of cash flows for additional required capital contributions related to the Company’s JVs varies by agreement. Some of the Company’s consolidated and unconsolidated JVs have entered into financing agreements where the Company or its JV partners have provided guarantees. See Note 9. Other Assets, Note 10. Debt, Net and Note ~~18.~~19. Commitments and Contingencies for additional information.

Consolidated Joint Ventures

Mexico Beach Crossings JV

Mexico Beach Crossings JV was formed in January 2022, when the Company entered into a JV agreement to develop, manage and lease apartments in Mexico Beach, Florida. The JV parties are working together to develop and construct the 216-unit apartment community. The community is located on land that was contributed to the JV by the Company. As of March 31, 2022, the Company owned a 75.0% interest in the consolidated JV. The Company’s partner is currently responsible for the construction activities of the JV, but once operational, Watersound Management, LLC (“Watersound Management JV”), the Company’s unconsolidated JV, will be responsible for the day-to-day activities of the JV. The Company approves all major decisions, including project development, annual budgets and financing. The Company determined Mexico Beach Crossings JV is a voting interest entity and that the Company has a majority voting interest as of March 31, 2022.

The Lodge 30A JV

The Lodge 30A JV was ~~created~~formed in July 2020, when the Company entered into a JV agreement to develop and operate a boutique hotel on Scenic County Highway 30A in Seagrove Beach, Florida. The JV parties are working together to develop and construct the 85-room hotel. ~~The hotel is located on Scenic County Highway 30A on land that was contributed to the JV by the Company’s JV partner.~~ As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 52.8% interest in the consolidated JV. The Company’s partner is currently responsible for the construction activities of the JV, but once operational, a wholly-owned subsidiary of the Company will manage the day-to-day operations of the hotel. The Company has significant involvement in the project design and development and approves all major decisions, including annual budgets and financing. The Company determined The Lodge 30A JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

Pier Park Resort Hotel JV

Pier Park Resort Hotel JV was ~~created~~formed in April 2020, when the Company entered into a JV agreement to develop and operate an Embassy Suites by Hilton hotel in the Pier Park area of Panama City Beach, Florida. The JV parties are working together to develop and construct athe 255-room hotel. ~~The hotel is located on land in the Pier Park area that was contributed to the JV by the Company.~~ As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 70.0% interest in the consolidated JV. The Company’s partner is currently responsible for the construction activities of the JV, but once operational, a wholly-owned subsidiary of the Company will manage the ~~day-to-day~~day-

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to-day operations of the hotel. The Company has significant involvement in the project design and development, annual budgets and financing. The Company determined Pier Park Resort Hotel JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

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Pier Park Crossings Phase II JV

Pier Park Crossings Phase II JV was ~~created~~formed in October 2019, when the Company entered into a JV agreement to develop, manage and lease ~~apartments in Panama City Beach, Florida. Construction of the~~a 120-unit apartment community ~~was completed in December 2020. The community is located on land~~ in the Pier Park area ~~that was contributed to the JV by the Company.~~of Panama City Beach, Florida. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 75.0% interest in the consolidated JV. The Company’s unconsolidated Watersound Management ~~LLC, (“Watersound Management JV”) the Company’s unconsolidated~~ JV is responsible for the day-to-day activities of the JV. The Company approves all major decisions, including project development, annual budgets and financing. The Company determined Pier Park Crossings Phase II JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

Watersound Closings JV

Watersound Closings JV was ~~created~~formed in October 2019, when the Company entered into a JV agreement to own, operate and manage a real estate title insurance agency business. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 58.0% interest in the consolidated JV. A wholly-owned subsidiary of the Company is the managing member of Watersound Closings JV and is responsible for the day-to-day activities of the business. As the manager of the JV, as well as the majority member, the Company has the power to direct all of the activities of the JV that most significantly impact economic performance. The Company determined Watersound Closings JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

Watercrest JV

Watercrest JV was ~~created~~formed in May 2019, when the Company entered into a JV agreement to develop and operate a ~~new~~107-unit senior living community in Santa Rosa Beach, Florida. ~~Construction of the 107-unit community was completed in the fourth quarter of 2020. The community is located on land that was contributed to the JV by the Company.~~ As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned an 87.0% interest in the consolidated JV. A wholly-owned subsidiary of the Company’s JV partner is responsible for the day-to-day activities of the community. However, the Company approves all major decisions, including project development, annual budgets and financing. The Company determined Watercrest JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

Watersound Origins Crossings JV

Watersound Origins Crossings JV was ~~created~~formed in January 2019, when the Company entered into a JV agreement to develop, manage and lease apartments ~~in Watersound, Florida. The JV parties are working together to develop and construct the remaining 59 units of the 217-unit apartment community. The community is located on land~~ near the entrance to the Watersound Origins residential community. Construction of the 217-unit apartment community ~~which~~ was ~~contributed to~~completed in the ~~JV by the Company.~~fourth quarter of 2021. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 75.0% interest in the consolidated JV. The Company’s unconsolidated Watersound Management JV is responsible for the day-to-day activities of the community. The Company has significant involvement in the design of the development and approves all major decisions, including project development, annual budgets and financing. The Company determined Watersound Origins Crossings JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

Pier Park Crossings JV

Pier Park Crossings JV was ~~created~~formed in April 2017, when the Company entered into a JV agreement to develop, manage and lease ~~apartments in Panama City Beach, Florida. The~~a 240-unit apartment community ~~is located on land~~ in the Pier Park area ~~that was contributed to the JV by the Company.~~of Panama City Beach, Florida. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 75.0% interest in the consolidated JV. The Company’s unconsolidated Watersound Management JV is responsible for the day-to-day activities of the community. The Company approves all major decisions, including project development, annual budgets and financing. The Company determined Pier Park Crossings JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

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Pier Park North JV

During 2012, the Company entered into a JV agreement with a partner to develop a retail center at Pier Park North. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 60.0% interest in the consolidated JV. A wholly-owned subsidiary of the Company’s JV partner is responsible for the day-to-day activities of the retail center. However, the Company approves all major decisions, including project development, annual budgets and financing. The Company determined the Pier Park North JV is a VIE and that the Company is the VIE’s primary beneficiary as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021.

Unconsolidated Joint Ventures

Investment in unconsolidated joint ventures includes the Company’s investment accounted for using the equity method. The following table presents detail of the Company’s investment in unconsolidated joint ventures and total outstanding debt of unconsolidated JVs:


	September 30,		December 31,		March 31,		December 31,
	2021		2020		2022		2021
Investment in unconsolidated joint ventures
Latitude Margaritaville Watersound JV	$	28,049	$	24,288	$	29,583	$	30,040
Sea Sound Apartments JV		10,244		10,348		10,316		10,333
Watersound Fountains Independent Living JV^(a)		7,508		—
Watersound Fountains Independent Living JV						7,508		7,508
Pier Park TPS JV		2,860		2,149		2,169		1,961
Busy Bee JV		1,552		1,180		1,819		1,621
Watersound Management JV ^(b)		553		—
Electric Cart Watersound JV^(a)						685		—
Watersound Management JV						542		564
Total investment in unconsolidated joint ventures	$	50,766	$	37,965	$	52,622	$	52,027

Outstanding debt of unconsolidated JVs
Latitude Margaritaville Watersound JV^(c)	$	14,162	$	3,297
Latitude Margaritaville Watersound JV^(b)					$	15,674	$	7,147
Sea Sound Apartments JV		31,833		8,789		35,905		35,047
Watersound Fountains Independent Living JV						7,287		66
Pier Park TPS JV		14,196		14,388		14,050		14,124
Busy Bee JV		6,392		6,614		6,241		6,317
Total outstanding debt of unconsolidated JVs^(d)	$	66,583	$	33,088
Total outstanding debt of unconsolidated JVs^(c)					$	79,157	$	62,701

(a)	JV was formed in ~~April 2021.~~February 2022.

(b)	~~JV was formed in June 2021.~~

~~(c)~~

See Note 9. Other Assets for additional information on the $10.0 million secured revolving promissory note the Company entered into with the unconsolidated Latitude Margaritaville Watersound JV.

~~(d)~~(c)

See Note ~~18.~~19. Commitments and Contingencies for additional information.

The Company's maximum exposure to loss due to involvement with the unconsolidated joint ventures as of ~~September 30, 2021~~March 31, 2022 was ~~$71.3~~$74.1 million, which includes the carrying amounts of the investments, guarantees, promissory note receivable, other receivables and derivative instruments.

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The following table presents detail of the Company’s equity in (loss) income from unconsolidated ~~affiliates:~~JVs:


	Three Months Ended March 31,
	2022		2021
Equity in (loss) income from unconsolidated joint ventures
Latitude Margaritaville Watersound JV	$	(623)	$	(642)
Sea Sound Apartments JV		(17)		(2)
Pier Park TPS JV		(74)		(46)
Busy Bee JV		197		222
Watersound Management JV^(a)		22		—
Total equity in loss from unconsolidated joint ventures	$	(495)	$	(468)

(a)	JV was formed in June 2021.

Summarized balance sheets for the Company’s unconsolidated JVs are as follows:


	March 31, 2022
	Latitude Margaritaville Watersound JV			Sea Sound Apartments JV		Watersound Fountains Independent Living JV		Pier Park TPS JV		Busy Bee JV		Electric Cart Watersound JV		Watersound Management JV		Total
ASSETS
Investment in real estate	$	78,274	^(a)	$	54,180	$	24,503	$	16,190	$	7,891	$	894	$	—	$	181,932
Cash and cash equivalents		8,777			1,511		243		1,897		765		712		94		13,999
Other assets		1,835			268		10		455		1,434		20		—		4,022
Total assets	$	88,886		$	55,959	$	24,756	$	18,542	$	10,090	$	1,626	$	94	$	199,953

LIABILITIES AND EQUITY
Debt, net	$	15,378		$	35,740	$	7,287	$	13,768	$	6,185	$	—	$	—	$	78,358
Other liabilities		49,705			2,989		3,513		444		326		360		—		57,337
Equity		23,803			17,230		13,956		4,330		3,579		1,266		94		64,258
Total liabilities and equity	$	88,886		$	55,959	$	24,756	$	18,542	$	10,090	$	1,626	$	94	$	199,953

(a)	As of March 31, 2022, investment in real estate includes the land contributed to the Latitude Margaritaville Watersound JV at the Company’s initial historical cost basis of $1.3 million and additional completed infrastructure improvements of $5.1 million.

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020
Equity in (loss) income from unconsolidated affiliates

Latitude Margaritaville Watersound JV

$
(896)

$
(136)

$
(2,497)

$
(304)
Sea Sound Apartments JV

(71)

—

(104)

—
Pier Park TPS JV

279

(41)

651

(47)
Busy Bee JV

180

82

372

50
Watersound Management JV

7

—

8

—
Total equity in loss from unconsolidated affiliates

$
(501)

$
(95)

$
(1,570)

$
(301)

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	December 31, 2021
	Latitude Margaritaville Watersound JV			Sea Sound Apartments JV		Watersound Fountains Independent Living JV		Pier Park TPS JV		Busy Bee JV		Electric Cart Watersound JV^(b)		Watersound Management JV		Total
ASSETS
Investment in real estate	$	54,034	^(a)	$	53,775	$	17,003	$	16,561	$	8,005	$	—	$	—	$	149,378
Cash and cash equivalents		12,541			760		240		1,913		855		—		138		16,447
Other assets		1,761			210		187		433		1,044		—		—		3,635
Total assets	$	68,336		$	54,745	$	17,430	$	18,907	$	9,904	$	—	$	138	$	169,460

LIABILITIES AND EQUITY
Debt, net	$	7,147		$	34,834	$	66	$	13,839	$	6,256	$	—	$	—	$	62,142
Other liabilities		36,419			2,653		3,408		1,147		405		—		—		44,032
Equity		24,770			17,258		13,956		3,921		3,243		—		138		63,286
Total liabilities and equity	$	68,336		$	54,745	$	17,430	$	18,907	$	9,904	$	—	$	138	$	169,460

(a)	As of December 31, 2021, investment in real estate includes the land contributed to the Latitude Margaritaville Watersound JV at the Company’s initial historical cost basis of $1.3 million and additional completed infrastructure improvements of $4.8 million.

(b)	JV was formed in February 2022.

Summarized statements of operations for the Company’s unconsolidated JVs are as follows:


	Three Months Ended March 31, 2022
	Latitude Margaritaville Watersound JV		Sea Sound Apartments JV		Watersound Fountains Independent Living JV^(a)		Pier Park TPS JV		Busy Bee JV		Electric Cart Watersound JV^(a)		Watersound Management JV			Total

Total revenue	$	7,140	$	1,154	$	—	$	1,124	$	3,704	$	—	$	252	$	13,374
Expenses:
Cost of revenue		5,726		433		—		632		3,146		—		208		10,145
Other operating expenses		2,581		87		—		93		436		—		—		3,197
Depreciation and amortization		56		351		—		362		115		—		—		884
Total expenses		8,363		871		—		1,087		3,697		—		208		14,226
Operating (loss) income		(1,223)		283		—		37		7		—		44		(852)
Other (expense) income:
Interest expense		—		(312)		—		(187)		(45)		—		—		(544)
Other income, net		—		—		—		1		398		—		—		399
Total other (expense) income		—		(312)		—		(186)		353		—		—		(145)
Net (loss) income	$	(1,223)	$	(29)	$	—	$	(149)	$	360	$	—	$	44	$	(997)

(a)	The project is under construction with no income or loss for the three months ended March 31, 2022.

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	Three Months Ended March 31, 2021
	Latitude Margaritaville Watersound JV		Sea Sound Apartments JV		Watersound Fountains Independent Living JV^(a)		Pier Park TPS JV		Busy Bee JV		Electric Cart Watersound JV^(b)		Watersound Management JV^(c)		Total

Total revenue	$	—	$	—	$	—	$	937	$	2,792	$	—	$	—	$	3,729
Expenses:
Cost of revenue		—		—		—		435		2,247		—		—		2,682
Other operating expenses		1,239		3		—		78		462		—		—		1,782
Depreciation and amortization		—		—		—		358		115		—		—		473
Total expenses		1,239		3		—		871		2,824		—		—		4,937
Operating (loss) income		(1,239)		(3)		—		66		(32)		—		—		(1,208)
Other (expense) income:
Interest expense		—		—		—		(158)		(53)		—		—		(211)
Other income, net		—		—		—		—		474		—		—		474
Total other (expense) income		—		—		—		(158)		421		—		—		263
Net (loss) income	$	(1,239)	$	(3)	$	—	$	(92)	$	389	$	—	$	—	$	(945)

(a)	The JV was formed in April 2021.

(b)	The JV was formed in February 2022.

(c)	The JV was formed in June 2021.

Latitude Margaritaville Watersound JV

LMWS, LLC (“Latitude Margaritaville Watersound JV”) was ~~created~~formed in June 2019, when the Company entered into a JV agreement to develop a 55+ active adult residential community in Bay County, Florida. ~~The JV parties are working together to develop the first phase of the community.~~ Construction is underway on ~~the initial~~ customer homes and town center amenities. As of March 31, 2022, the Latitude Margaritaville Watersound JV had 527 homes under contract and has completed 65 home sale transactions of the total estimated 3,500 homes in the community. The community is located on land that was contributed to the JV by the Company in June 2020. As part of the land contribution, the Company agreed to make certain infrastructure improvements, such that the total contractual value of the land and its improvements ~~equals~~total $35.0 million. As of ~~September 30,~~March 31, 2022 and December 31, 2021, the Company’s investment in the unconsolidated Latitude Margaritaville Watersound JV ~~includes $11.7~~was $29.6 million ~~of cash contributions~~ and ~~$16.6~~$30.0 million, ~~for~~respectively, which includes the net present value of the land ~~contribution. As~~contribution, cash contributions, additional completed infrastructure improvements, equity in loss, return of ~~September 30, 2021,~~land contribution and interest related to the ~~Company’s JV partner contributed $11.7 million of cash.~~revolving promissory note receivable. The initial present value of the land contribution of $16.6 million, was based on the Company’s best estimate of the prevailing market rates for the source of credit using an imputed interest rate of ~~5.75%~~5.8% and timing of home sales. The Company continues to have a performance obligation to provide agreed upon infrastructure improvements in the vicinity of the contributed land, which will be recognized over time as improvements are completed. As of ~~September 30, 2021,~~March 31, 2022, the Company completed ~~$3.1~~$5.1 million of the agreed upon infrastructure improvements. The transaction price was allocated based on the stand-alone selling prices of the land and agreed upon improvements. ~~The Latitude Margaritaville Watersound JV community is estimated to include approximately 3,500 residential homes, which will be developed in smaller increments of discrete neighborhoods.~~ As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 50.0% voting interest in the JV. Each JV member will continue to contribute an equal amount of cash towards the development and construction of the main spine infrastructure and amenities. The Company’s unimproved land contribution and agreed upon infrastructure improvements ~~will be~~are being returned at an average of $10,000 per home, as each home is sold by the JV.

Per the JV agreement, the Company, as lender, has provided interest-bearing financing in the form of a $10.0 million secured revolving promissory note (the “Latitude JV Note”) to the Latitude Margaritaville Watersound JV, as

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borrower, to finance the development of the pod-level, non-spine ~~infrastructure, which~~infrastructure. As of March 31, 2022, there was 0 balance outstanding on theLatitude JV Note. As of December 31, 2021, $7.1 million was outstanding on theLatitude JV Note. Future advances, if any, will be repaid by the JV as each home is sold. See Note 9. Other Assets for additional information related to the revolving promissory note. The day-to-day activities of the JV are being managed through a board of managers, with each JV partner having equal voting rights. The Company has determined that Latitude Margaritaville Watersound JV is a VIE, but that the Company is not the primary beneficiary since it does not have the power to direct the activities that most significantly impact the economic performance of the JV. The Company’s investment in the Latitude Margaritaville Watersound JV is accounted for using the equity method. See Note ~~18.~~19. Commitments and Contingencies for additional information related to the guaranty by the Company.

~~Table of Contents~~

~~Summarized financial information for Latitude Margaritaville Watersound JV is as follows:~~

September 30,

December 31,

2021

2020
BALANCE SHEETS:




Investment in real estate^(a)

$
46,274

$
18,255
Cash and cash equivalents

9,506

1,603
Other assets

946

136
Total assets

$
56,726

$
19,994




Debt, net

$
13,828

$
2,844
Other liabilities

21,034

1,794
Equity

21,864

15,356
Total liabilities and equity

$
56,726

$
19,994

~~(a)~~

As of September 30, 2021 and December 31, 2020, investment in real estate includes the land contributed to the Latitude Margaritaville Watersound JV at the Company’s historical cost basis of $1.3 million and additional completed infrastructure improvements of $3.1 million and $1.8 million, respectively.

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020
STATEMENTS OF OPERATIONS:

Total expenses

$
1,687

$
260

$
4,763

$
595
Net loss

$
(1,687)

$
(260)

$
(4,763)

$
(595)

Sea Sound Apartments JV

FDSJ Eventide, LLC (“Sea Sound Apartments JV”) was ~~created~~formed in January 2020. The Company entered into a JV agreement to develop, construct and manage ana 300-unit apartment community near the Breakfast Point residential community in Panama City Beach, Florida. ~~The JV parties are working together to develop and construct the remaining 218 units~~Construction of the ~~300-unit apartment community. The~~ community ~~is located near~~was completed in the ~~Breakfast Point residential communities on land that was contributed to the JV by the Company in January 2020, with a fair value~~first quarter of ~~$5.1 million. In addition, during 2020, the Company contributed mitigation bank credits of $0.4 million and cash of $4.9 million and the JV partner contributed $6.9 million of cash.~~2022. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 60.0% interest in the JV. The Company’s partner is responsible for the day-to-day activities of the JV. The Company has determined that Sea Sound Apartments JV is a VIE, but that the Company is not the primary beneficiary since it does not have the power to direct the activities that most significantly impact the economic performance of the JV. The Company’s investment in Sea Sound Apartments JV is accounted for using the equity method. In January 2020, the JV entered into a $40.3 million loan (the “Sea Sound Apartments JV Loan”). The Sea Sound Apartments JV Loan bears interest at LIBOR plus ~~2.15%~~2.2% and matures in January 2024. The Sea Sound Apartments JV Loan is secured by the real property, all assets of the borrower, assignment of leases and rents and the security interest in the rents and personal property. The Company’s JV partner is the sole guarantor of the Sea Sound Apartments JV Loan. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, $31.8~~2021, $35.9 million and ~~$8.8~~$35.0 million, respectively, was outstanding on the Sea Sound Apartments JV Loan.

~~Table of Contents~~

~~Summarized financial information for Sea Sound Apartments JV is as follows:~~

September 30,

December 31,

2021

2020
BALANCE SHEET:




Investment in real estate

$
52,055

$
29,085
Cash and cash equivalents

172

15
Other assets

30

—
Total assets

$
52,257

$
29,100




Debt, net

$
31,570

$
8,378
Other liabilities

3,578

3,439
Equity

17,109

17,283
Total liabilities and equity

$
52,257

$
29,100

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020
STATEMENTS OF OPERATIONS:

Total revenue

$
143

$
—

$
164

$
—
Expenses:

Cost of revenue

142

—

213

—
Other operating expenses

16

—

16

—
Depreciation and amortization

72

—

72

—
Total expenses

230

—

301

—
Operating loss

(87)

—

(137)

—
Interest expense

(37)

—

(37)

—
Net loss

$
(124)

$
—

$
(174)

$
—

Watersound Fountains Independent Living JV

WOSL, LLC (“Watersound Fountains Independent Living JV”) was ~~created~~formed in April 2021. The Company entered into a JV agreement to develop, construct and manage a 148-unit independent senior living community innear the Watersound ~~Florida.~~Origins residential community. The 3 JV parties are working together to develop and construct the project. The community is located ~~near the Watersound Origins residential community~~ on land that was contributed to the JV by the Company in April 2021, with a fair value of $3.2 million. In addition, during 2021, the Company contributed cash of $4.3 million and the JV partners contributed $6.4 ~~million.~~ million~~The project is currently under development with 0 income or loss impacting the condensed consolidated statements of income for the three and nine months ended September 30, 2021.~~. As of ~~September 30,~~March 31, 2022 and December 31, 2021, the Company owned a 53.8% interest in the JV. The Company’s partners are responsible for the day-to-day activities of the JV. The Company has determined that Watersound Fountains Independent Living JV is a VIE, but that the Company is not the primary beneficiary since it does not have the power to direct the activities that most significantly impact the economic performance of the JV. The Company’s investment in Watersound Fountains Independent Living JV is accounted for using the equity method. See Note ~~18.~~19. Commitments and Contingencies for additional information related to debt guaranteed by the Company.

~~Table of Contents~~

~~Summarized financial information for Watersound Fountains Independent Living JV is as follows:~~

September 30,

2021
BALANCE SHEET:


Investment in real estate

$
10,303
Cash and cash equivalents

4,594
Other assets

199
Total assets

$
15,096


Other liabilities

$
1,140
Equity

13,956
Total liabilities and equity

$
15,096

Pier Park TPS, LLC

Pier Park TPS, LLC (“Pier Park TPS JV”) was ~~created~~formed in April 2018. The Company entered into a JV agreement to develop and operate a 124-room hotel in Panama City Beach, Florida. ~~The hotel opened in May 2020.~~ As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 50.0% interest in the JV. The Company’s partner is responsible for the day-to-day activities of the JV. The Company has determined that Pier Park TPS JV is a VIE, but that the Company is not the primary beneficiary since it does not have the power to direct the activities that most significantly impact the economic performance of the JV. The Company’s investment in Pier Park TPS JV is accounted for using the equity method. See Note ~~18.~~19. Commitments and Contingencies for additional information related to debt guaranteed by the Company.

~~Summarized financial information for Pier Park TPS JV is as follows:~~

September 30,

December 31,

2021

2020
BALANCE SHEETS:




Property and equipment, net

$
16,913

$
17,946
Cash and cash equivalents

3,710

1,705
Other assets

297

483
Total assets

$
20,920

$
20,134




Debt, net

$
13,908

$
14,090
Other liabilities

1,393

1,745
Equity

5,619

4,299
Total liabilities and equity

$
20,920

$
20,134

~~Table of Contents~~

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020
STATEMENTS OF OPERATIONS:

Total revenue

$
2,252

$
1,001

$
5,473

$
1,534
Expenses:

Cost of revenue

818

515

2,069

789
Other operating expenses

84

92

241

130
Depreciation and amortization

359

379

1,076

578
Total expenses

1,261

986

3,386

1,497
Operating income

991

15

2,087

37
Interest expense

(191)

(98)

(542)

(132)
Net income (loss)

$
800

$
(83)

$
1,545

$
(95)

SJBB, LLC

SJBB, LLC (“Busy Bee JV”) was ~~created~~formed in July 2019, when the Company entered into a JV agreement to construct, own and manage a Busy Bee branded fuel station and convenience store in Panama City Beach, Florida. ~~Construction of the fuel station and convenience store was completed in June 2020.~~ As of ~~September 30, 2021~~

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March 31, 2022 and December 31, ~~2020,~~2021, the Company owned a 50.0% interest in the JV. The Company’s partner is responsible for the day-to-day activities of the JV. The Company has determined that Busy Bee JV is a VIE, but that the Company is not the primary beneficiary since it does not have the power to direct the activities that most significantly impact the economic performance of the JV. The Company’s investment in the Busy Bee JV is accounted for using the equity method. ~~See Note 18.~~ ~~Commitments~~In November 2019, the JV, entered into a $5.4 million construction loan (the “Busy Bee JV Construction Loan”) and ~~Contingencies~~ ~~for additional information related to debt guaranteed by the Company.~~

~~Summarized financial information for~~a $1.2 million equipment loan (the “Busy Bee JV Equipment Loan”). The Busy Bee JV Construction Loan and the Busy Bee JV Equipment Loan bear interest at LIBOR plus 1.5%. The Busy Bee JV Construction Loan provides for monthly principal and interest payments with a final balloon payment at maturity in November 2035. The Busy Bee JV Equipment Loan provides for monthly principal and interest payments through maturity in November 2027. The loans are secured by the real and personal property, assignment of rents and leases and a security interest in the construction contract and management agreement. The Company’s JV partner is ~~as follows:~~the sole guarantor and receives a fee related to the guarantee from the Company based on the Company’s ownership percentage. The Busy Bee JV entered into an interest rate swap to hedge cash flows tied to changes in the underlying floating interest rate tied to LIBOR for the Busy Bee JV Construction Loan and the Busy Bee JV Equipment Loan. The Busy Bee JV Construction Loan interest rate swap was effective November 12, 2020 and matures on November 12, 2035 and fixed the variable rate debt, initially at $5.4 million amortizing to $2.8 million at swap maturity, to a rate of 2.7%. The Busy Bee JV Equipment Loan interest rate swap was effective November 12, 2020 and matures on November 12, 2027 and fixed the variable rate debt, initially at $1.2 million to maturity, to a rate of 2.1%. As of March 31, 2022 and December 31, 2021, $5.2 million and $5.3 million, was outstanding on the Busy Bee JV Construction Loan. As of March 31, 2022 and December 31, 2021, $1.0 million and $1.1 million, respectively, was outstanding on the Busy Bee JV Equipment Loan.

SJECC, LLC

September 30,

December 31,

2021

2020
BALANCE SHEETS:




Property and equipment, net

$
8,121

$
8,466
Cash and cash equivalents

871

227
Other assets

1,080

717
Total assets

$
10,072

$
9,410




Debt, net

$
6,326

$
6,532
Other liabilities

574

506
Equity

3,172

2,372
Total liabilities and equity

$
10,072

$
9,410

~~Table~~SJECC, LLC (“Electric Cart Watersound JV”) was formed in February 2022, when the Company entered into a JV agreement to develop, construct, lease, manage and operate a golf cart and low speed vehicle “LSV” business at the new Watersound West Bay Center adjacent to the Latitude Margaritaville Watersound residential community in Panama City Beach, Florida. This land was contributed to the JV by the Company in February 2022, with a fair value of ~~Contents~~

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020
STATEMENTS OF OPERATIONS:

Total revenue

$
4,957

$
3,360

$
12,555

$
3,360
Expenses:

Cost of revenue

3,909

2,510

9,935

2,510
Other operating expenses

516

530

1,533

580
Depreciation and amortization

116

135

347

135
Total expenses

4,541

3,175

11,815

3,225
Operating income

416

185

740

135
Other (expense) income:

Interest expense

(48)

(39)

(145)

(54)
Other (expense) income, net

(51)

—

205

—
Total other (expense) income

(99)

(39)

60

(54)
Net income

$
317

$
146

$
800

$
81

$0.5 million. In addition, during 2022 the Company contributed cash of $0.2 million and the JV partner contributed cash of $0.6 million. The Watersound West Bay Center location is currently under development, with the JV to operate from temporary facilities. An additional sales showroom will be located at the Watersound Town Center near the Watersound Origins residential community on property to be leased to the JV by the Company. As of March 31, 2022, the Company owned a 51% interest in the JV. The Company is currently responsible for the construction activities of the JV, but once operational, the Company’s JV partner will manage the day-to-day operations of the business. The Company has determined Electric Cart Watersound JV is a VIE, but that the Company is not the primary beneficiary since it does not have the power to direct the activities that most significantly impact the economic performance of the JV. The Company’s investment in Electric Cart Watersound JV is accounted for using the equity method.

Watersound Management JV

Watersound Management, LLC was ~~created~~formed in June 2021. During 2021, the Company purchased an interest in Watersound Management, LLC for $0.5 million to form a JV to lease, manage and operate multi-family housing developments for which the JV is the exclusive renting and management agent. In addition, the Company and its JV partner each contributed cash of less than $0.1 million. As of ~~September 30,~~March 31, 2022 and December 31, 2021, the Company owned a 50.0% interest in the JV. The day-to-day activities of the JV are being managed through a board of managers, with each JV partner having equal voting rights. The Company has determined that Watersound Management JV is a voting interest entity, but that the Company does not have a majority voting interest. The Company’s investment in Watersound Management JV is accounted for using the equity method.

~~Summarized financial information for Watersound Management JV is as follows:~~

September 30,

2021
BALANCE SHEET:


Cash and cash equivalents

$
147
Total assets

$
147


Other liabilities

$
31
Equity

116
Total liabilities and equity

$
147

Three Months Ended September 30, 2021

Nine Months Ended September 30, 2021
STATEMENTS OF INCOME:

Total revenue

$
201

$
263
Total expenses

187

247
Net income

$
14

$
16

2220

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5. Investments

Available-For-Sale Investments

Investments classified as available-for-sale securities were as follows:

September 30, 2021

March 31, 2022

Gross Unrealized

Amortized Cost

Gains

(Losses)

Fair Value

Amortized Cost

Gains

(Losses)

Fair Value

Investments - debt securities:

U.S. Treasury Bills

102,982

(1)

102,986

118,504

—

(331)

118,173


	December 31, 2020								December 31, 2021
			Gross Unrealized		Gross Unrealized						Gross Unrealized		Gross Unrealized
	Amortized Cost		Gains		(Losses)		Fair Value		Amortized Cost		Gains		(Losses)		Fair Value
Investments - debt securities:
U.S. Treasury Bills	$	47,986	$	5	$	—	$	47,991	$	88,966	$	1	$	(11)	$	88,956
Corporate debt securities		60		—		—		60
		48,046		5		—		48,051
Restricted investments:
Short-term bond		1,160		11		—		1,171
		1,160		11		—		1,171
	$	49,206	$	16	$	—	$	49,222

During the three months ended ~~September 30, 2021,~~March 31, 2022, the Company did 0t have any realized gains or losses or proceedsfrom the sale of available-for-sale securities. During the ~~nine~~three months ended ~~September 30,~~March 31, 2022, maturities of available-for-sale securities were $45.0 million and purchases of available-for-sale securities were $74.5 million.

During the three months ended March 31, 2021, net realized gains from the sale of available-for-sale securities were less than $0.1 million, proceeds from the sale of available-for-sale securities were $1.2 million, maturities of available-for-sale securities were ~~$73.0 million and purchases of available-for-sale securities were $127.9 million.~~

~~During the three months ended September 30, 2020, there were 0 realized gains or~~ ~~losses~~ from the sale of available-for-sale securities. During the nine months ended September 30, 2020 net realized gains from the sale of available-for-sale securities were less than $0.1 million, proceeds from the sale of available-for-sale securities were $1.2 million, maturities of available-for-sale securities were $9.0$39.0 million and purchases of available-for sale securities were ~~$58.9~~$85.0 million.

The following table provides the available-for-sale investments with an unrealized loss position and their related fair values:


	September 30, 2021								December 31, 2020								March 31, 2022								December 31, 2021
	Less Than 12 Months				12 Months or Greater				Less Than 12 Months				12 Months or Greater				Less Than 12 Months				12 Months or Greater				Less Than 12 Months				12 Months or Greater
			Unrealized				Unrealized				Unrealized				Unrealized				Unrealized				Unrealized				Unrealized				Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Investments - debt securities:
U.S. Treasury Bills	$	15,997	$	1	$	—	$	—	$	—	$	—	$	—	$	—	$	118,173	$	331	$	—	$	—	$	43,959	$	11	$	—	$	—

As of ~~September 30,~~March 31, 2022, the Company had unrealized losses of $0.3 million related to U.S. Treasury Bills. As of December 31, 2021, the Company had de minimis unrealized losses related to U.S. Treasury Bills. As of March 31, 2022 and December 31, ~~2020, the Company did not have unrealized losses related to investments – debt securities. As of September 30,~~ 2021, the Company determined the unrealized losses related to U.S. Treasury Bills were not due to credit impairment and did not record an allowance for credit losses related to available-for-sale debt securities. In addition, the Company did not intend to sell the investments with an unrealized loss and it is more likely than not that the Company will not be required to sell any of these securities prior to their anticipated recovery.

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The amortized cost and estimated fair value of investments - debt securities classified as available-for-sale, by contractual maturity are shown in the following table.

September 30, 2021

March 31, 2022

Amortized Cost

Fair Value

Amortized Cost

Fair Value

Due in one year or less

102,982

102,986

118,504

118,173

Investment Management Agreement

Mr. Bruce R. Berkowitz is the Chairman of the Company’s Board of Directors (the “Board”). He is the Manager of, and controls entities that own and control, Fairholme Holdings, LLC, which wholly owns Fairholme Capital

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Management, L.L.C. (“FCM”), an investment advisor registered with the SEC. Mr. Berkowitz is the Chief Investment Officer of FCM, which has provided investment advisory services to the Company since April 2013. FCM does not receive any compensation for services as the Company’s investment advisor. As of ~~September 30, 2021,~~March 31, 2022, clients of FCM, including Mr. Berkowitz, beneficially owned approximately ~~42.9%~~41.8% of the Company’s common stock. FCM and its client, The Fairholme Fund, (“Fairholme”) a series of investments originating from the Fairholme Funds, Inc., may be deemed affiliates of the Company.

Pursuant to the terms of an Investment Management Agreement, as amended, (the “Investment Management Agreement”) with the Company, FCM agreed to supervise and direct the Company’s investment accounts in accordance with the investment guidelines and restrictions approved by the Company. The investment guidelines are set forth in the Investment Management Agreement and require that any new securities for purchase must be issues of the U.S. Treasury or U.S. Treasury Money Market Funds.

6. Financial Instruments and Fair Value Measurements

Fair Value Measurements

The financial instruments measured at fair value on a recurring basis are as follows:


	September 30, 2021								March 31, 2022
							Total Fair								Total Fair
	Level 1		Level 2		Level 3		Value		Level 1		Level 2		Level 3		Value
Cash equivalents:
Money market funds	$	9,380	$	—	$	—	$	9,380	$	8,936	$	—	$	—	$	8,936
		9,380		—		—		9,380		8,936		—		—		8,936

Investments - debt securities:
U.S. Treasury Bills		102,986		—		—		102,986		118,173		—		—		118,173
		102,986		—		—		102,986		118,173		—		—		118,173

Investments - equity securities:
Preferred stock		—		375		—		375		—		474		—		474
		—		375		—		375		—		474		—		474
	$	112,366	$	375	$	—	$	112,741	$	127,109	$	474	$	—	$	127,583

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	December 31, 2020								December 31, 2021
							Total Fair								Total Fair
	Level 1		Level 2		Level 3		Value		Level 1		Level 2		Level 3		Value
Cash equivalents:
Money market funds	$	10,973	$	—	$	—	$	10,973	$	40,412	$	—	$	—	$	40,412
U.S. Treasury Bills		78,991		—		—		78,991		4,000		—		—		4,000
		89,964		—		—		89,964		44,412		—		—		44,412

Investments - debt securities:
U.S. Treasury Bills		47,991		—		—		47,991		88,956		—		—		88,956
Corporate debt securities		—		60		—		60
		47,991		60		—		48,051		88,956		—		—		88,956

Investments - equity securities:
Preferred stock		—		2,623		—		2,623		—		450		—		450
		—		2,623		—		2,623		—		450		—		450
									$	133,368	$	450	$	—	$	133,818
Restricted investments:
Short-term bond		1,171		—		—		1,171
		1,171		—		—		1,171
	$	139,126	$	2,683	$	—	$	141,809

Money market funds and U.S. Treasury Bills ~~and short-term bonds~~ are measured based on quoted market prices in an active market and categorized within Level 1 of the fair value hierarchy. Money market funds and ~~short term~~short-term U.S. Treasury Bills with a ~~maturity date of 90 days or less from the date of purchase are classified as cash equivalents in the Company’s condensed consolidated balance sheets.~~

The Company’s corporate debt securities and preferred stock investments are not traded on a nationally recognized exchange, but are traded in the U.S. over-the-counter market where there is less trading activity and the investments are measured primarily using pricing data from external pricing services that report prices observed for recently executed market transactions. For these reasons, the Company has determined that corporate debt securities and preferred stock investments are categorized as Level 2 financial instruments since their fair values were determined from market inputs in an inactive market.

As of December 31, 2020, restricted investments were included within other assets on the condensed consolidated balance sheets and included certain of the surplus assets that were transferred from the Company’s Pension Plan to a suspense account in the Company’s 401(k) plan in December 2014. The Company retained the risks and rewards of ownership of these assets; therefore, the assets held in the suspense account were included in the Company’s condensed consolidated financial statements until they were allocated to participants. The final allocation of the assets occurred in March 2021. As of December 31, 2020, the assets held in the suspense account were invested in a Vanguard Short-Term Bond Fund, which invests in money market instruments and short-term high quality bonds, including asset-backed, government, and investment grade corporate securities with an expected ~~maturity~~ of 0-3 years. The Vanguard Short-Term Bond Fund is measured based on quoted market prices in an active market and categorized within Level 1 of the fair value hierarchy. The Company’s Retirement Plan Investment Committee was responsible for investing decisions and allocation decisions of the suspense account. Refer to Note 9. ~~Other Assets~~.

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maturity date of 90 days or less from the date of purchase are classified as cash equivalents in the Company’s condensed consolidated balance sheets.

The Company’s preferred stock investments are not traded on a nationally recognized exchange but are traded in the U.S. over-the-counter market where there is less trading activity and the investments are measured primarily using pricing data from external pricing services that report prices observed for recently executed market transactions. For these reasons, the Company has determined that preferred stock investments are categorized as Level 2 financial instruments since their fair values were determined from market inputs in an inactive market.

Assets and liabilities measured at fair value on a recurring basis related to interest rate swap agreements designated as cash flow hedges are as follows:


		September 30, 2021										Fixed		Notional					Fair	Location in
	Location in							Total Fair		Effective	Maturity	Interest		Amount as of	Derivative Asset (Liability) Fair Value				Value	Consolidated
Description										Date	Date	Rate		March 31, 2022	March 31, 2022		December 31, 2021		Level	Balance Sheets

	Balance Sheet	Level 1		Level 2		Level 3		Value						In Millions	In Thousands
Derivative Assets:
Interest rate swap	Other assets	$	—	$	309	$	—	$	309

Derivative Liabilities:
Interest rate swap	Other liabilities	$	—	$	929	$	—	$	929
Interest rate swap - unconsolidated affiliate	Investment in unconsolidated joint ventures		—		562		—		562
		$	—	$	1,491	$	—	$	1,491
Pier Park Resort Hotel JV Loan^(a)										12/10/2022	4/12/2027	3.2%	$	42.0	$	2,285	$	558	2	Other assets
Watercrest JV Loan^(a)										6/1/2021	6/1/2024	4.4%	$	20.0	$	49	$	(634)	2	Other assets (liabilities)
Pier Park TPS JV Loan^(b)										1/14/2021	1/14/2026	5.2%	$	14.0	$	(77)	$	(436)	2	Investment in unconsolidated joint ventures

(a)	See Note 10. Debt, Net for additional information.

(b)

Interest rate swap was entered into by the Pier Park TPS JV, which is unconsolidated and accounted for using the equity method. The derivative liability has been recorded at the Company’s proportionate share of its estimated fair value. The Company’s proportionate share of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into equity in loss from unconsolidated joint ventures in the period during which the hedged transaction affects earnings. See Note 4. Joint Ventures and Note 19. Commitments and Contingencies for additional information.

The following is a summary of the effect of derivative instruments on the Company’s condensed consolidated statements of income and condensed consolidated statements of comprehensive income:


		December 31, 2020								Three Months Ended March 31,
	Location in							Total Fair		2022		2021
	Balance Sheet	Level 1		Level 2		Level 3		Value
Derivative Liabilities:
Interest rate swap	Other liabilities	$	—	$	1,172	$	—	$	1,172
Interest rate swap - unconsolidated affiliate	Investment in unconsolidated joint ventures		—		821		—		821
		$	—	$	1,993	$	—	$	1,993
Amount of gain recognized in other comprehensive income on derivatives										$	2,621	$	368
Amount of loss reclassified into interest expense										$	101	$	—
Amount of loss reclassified into equity in loss from unconsolidated joint ventures										$	46	$	—

In July 2021, the Pier Park Resort Hotel JV entered into an interest rate swap agreement designated as a cash flow hedge to manage the interest rate risk associated with variable rate debt. The interest rate swap is effective December 10, 2022 and matures on April 12, 2027 and fixed the variable rate on the notional amount of related debt of $42.0 million. As of ~~September 30, 2021, the interest rate swap was recorded at its estimated fair value,~~March 31, 2022, based on Level 2 measurements, of $0.3 million and is included within other assets on the condensed consolidated balance sheets. The gain or loss on the derivative instrument is reported as a component of other comprehensive income (loss) and reclassified into earnings in the period during which the hedged transaction affects earnings. The Company did not reclassify any amounts out of other comprehensive income (loss) into interest expense during the three and nine months ended September 30, 2021. See Note 10. ~~Debt~~ ~~for additional information.~~

In June 2019, the Watercrest JV entered into an interest rate swap agreement designated as a cash flow hedge to manage the interest rate risk associated with variable rate debt. The interest rate swap was effective June 1, 2021 and matures on June 1, 2024 and fixed the variable rate on the notional amount of related debt of $20.0 million. As of September 30, 2021 and December 31, 2020, the interest rate swap was recorded at its estimated faircurrent value, based on Level 2 measurements, of $0.9 million and $1.2 million, respectively, and is included within other liabilities on the condensed consolidated balance sheets. The gain or loss on the derivative instrument is reported as a component of other comprehensive income (loss) and reclassified into earnings in the period during which the hedged transaction affects earnings. During each the three and nine months ended September 30, 2021, the Company reclassified a loss of $0.1 million out of other comprehensive income (loss) into interest expense. The Company did 0t reclassify any amounts out of other comprehensive income (loss) into interest expense during the three and nine months ended September 30, 2020. See Note 10. ~~Debt~~ ~~for additional information.~~

In January 2019, the Pier Park TPS JV, which is unconsolidated and accounted for using the equity method, entered into an interest rate swap agreement designated as a cash flow hedge to manage the interest rate risk associated with variable rate debt. The interest rate swap was effective January 14, 2021 and matures on January 14, 2026 and fixed the variable rate on the related debt of $14.2 million. As of September 30, 2021 and December 31, 2020, the interest rate swap was recorded at the Company’s proportionate share of its estimated fair value, based on Level 2 measurements, of $0.6 million and $0.8 million, respectively, and is included within investment in unconsolidated joint ventures on the condensed consolidated balance sheets. The Company’s proportionate share of the gain or loss on the derivative instrument is reported as a component of other comprehensive income (loss) and reclassified into earnings in the period during which the hedged transaction affects earnings. During each the three and nine months ended September 30, 2021, the Company reclassified a loss of $0.1 million out of other comprehensive income (loss) into equity in loss from

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unconsolidated affiliates. The Company did 0t reclassify any amounts out of other comprehensive income (loss) into equity in loss from unconsolidated affiliates during the three and nine months ended September 30, 2020. See Note 4. ~~Joint Ventures~~ ~~and Note 18.~~ ~~Commitments and Contingencies~~ ~~for additional information.~~

~~As of September 30, 2021,~~ the Company expects to reclassify ~~$0.6~~$0.7 million of net losses on derivative instruments from accumulated other comprehensive ~~loss~~income (loss) to earnings during the next twelve months.

Investment in Unconsolidated Joint Ventures

The Company evaluates its investment in unconsolidated JVs for impairment during each reporting period. A series of operating losses of an investee or other factors may indicate that a decrease in the value of the Company’s investment in the unconsolidated JV has occurred. The amount of impairment recognized is the excess of the investment’s carrying value over its estimated fair value. The fair value of the Company’s investment in unconsolidated JVs is determined primarily using a discounted cash flow model to value the underlying net assets of the respective JV. The fair value of investment in unconsolidated JVs required to be assessed for impairment is determined ~~on a nonrecurring basis~~ using Level 3 inputs in the fair value hierarchy. NaN impairment for unconsolidated JVs was recorded during the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021. See Note 4. Joint Ventures for additional information.

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Fair Value of Financial Instruments

The Company uses the following methods and assumptions in estimating fair value for financial instruments:

●

The fair value of the investments held by SPEs - time deposit is based on the present value of future cash flows at the current market rate.

●

The fair value of the investments held by SPEs - U.S. Treasury Bills are measured based on quoted market prices in an active market.

●

The fair value of debt is based on discounted future expected cash flows based on current market rates for financial instruments with similar risks, terms and maturities.

●

The fair value of the senior notes held by SPE is based on the present value of future cash flows at the current market rate.

The carrying amount and estimated fair value, measured on a nonrecurring basis, of the Company’s financial instruments were as follows:


	September 30, 2021					December 31, 2020					March 31, 2022					December 31, 2021
	Carrying		Estimated			Carrying		Estimated			Carrying		Estimated			Carrying		Estimated
	value		Fair value		Level	value		Fair value		Level	value		Fair value		Level	value		Fair value		Level
Assets

Investments held by SPEs:
Time deposit	$	200,000	$	200,000	3	$	200,000	$	200,000	3	$	200,000	$	200,000	3	$	200,000	$	200,000	3
U.S. Treasury Bills	$	5,094	$	5,506	1	$	5,759	$	6,363	1	$	4,754	$	4,873	1	$	5,132	$	5,475	1
Liabilities

Senior Notes held by SPE											$	177,637	$	193,575	3	$	177,566	$	204,802	3
Debt
Fixed-rate debt	$	125,450	$	123,857	2	$	114,125	$	116,509	2	$	98,192	$	97,983	2	$	129,532	$	126,722	2
Variable-rate debt		73,430		73,430	2		47,293		47,293	2		163,899		163,899	2		97,942		97,942	2
Total debt	$	198,880	$	197,287		$	161,418	$	163,802		$	262,091	$	261,882		$	227,474	$	224,664
Senior Notes held by SPE	$	177,495	$	206,408	3	$	177,289	$	216,363	3

Investments and Senior Notes Held by Special Purpose Entities

In connection with a real estate sale in 2014, the Company received consideration including a $200.0 million fifteen-year installment note (the “Timber Note”) issued by Panama City Timber Finance Company, LLC. The Company contributed the Timber Note and assigned its rights as a beneficiary under a letter of credit to Northwest Florida Timber Finance, LLC. Northwest Florida Timber Finance, LLC monetized the Timber Note by issuing $180.0 million aggregate

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principal amount of its 4.8% Senior Secured Notes due in 2029 (the “Senior Notes”) at an issue price of 98.5% of face value to third party investors. The investments held by Panama City Timber Finance Company, LLC as of ~~September 30, 2021,~~March 31, 2022, consist of a $200.0 million time deposit that, subsequent to April 2, 2014, pays interest at 4.0% and matures in March 2029, U.S. Treasuries of ~~$5.1~~$4.7 million and cash of $0.4 million. The Senior Notes held by Northwest Florida Timber Finance, LLC as of ~~September 30, 2021~~March 31, 2022 consist of ~~$177.5~~$177.6 million, net of the ~~$2.5~~$2.4 million discount and debt issuance costs. Panama City Timber Finance Company, LLC and Northwest Florida Timber Finance, LLC are VIEs, which the Company consolidates as the primary beneficiary of each entity.

7. Hurricane Michael

On October 10, 2018, Hurricane Michael made landfall in the Florida Panhandle. The majority of the Company’s properties incurred minimal or no damage; however, the Company’s Point South Marina Bay Point ~~Marina~~ in Bay County and Point South Marina Port St. Joe ~~Marina~~ in Gulf County, as well as certain timber, commercial and multi-family leasing assets were impacted. The marinas suffered significant damage requiring long-term restoration and ~~will remain~~have remained closed during the reconstruction of significant portions of these assets. A portion of the marinas are expected to open ~~by the end~~in spring 2022.

Table of ~~2021.~~Contents

The Company maintains property and business interruption insurance, subject to certain deductibles, and is continuing to assess claims under such policies; however, the timing and amount of insurance proceeds are uncertain and may not be sufficient to cover all losses. Timing differences exist between the impairment losses, capital expenditures made to repair or restore properties and recognition and receipt of insurance proceeds reflected in the Company’s financial statements. During the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, $0.2 million and $0.6 million, respectively, of business interruption proceeds were received related to the marinas, which are included within the cost of hospitality revenue on the condensed consolidated statements of income. During the three months ended September 30, 2020, 0 insurance proceeds were received related to business interruption. During the nine months ended September 30, 2020, $0.7 million of business interruption insurance proceeds were received related to the Pier Park Crossings JV, which are included within the cost of leasing revenue on the condensed consolidated statements of income. Costs incurred due to business interruption at the marinas are continuing to be evaluated. The Company does not expect revenue at these locations until the properties have been rebuilt, but will continue to incur costs for employee retention and property maintenance.

During the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, the Company recognized ~~$2.5~~$0.7 million and ~~$3.9~~$0.9 million, respectively, of gain on insurance recovery and incurred loss from hurricane damage of less than $0.1 ~~million. During the three and nine months ended September 30, 2020, the Company did 0t recognize any gain on insurance recovery, but incurred loss from hurricane damage of $0.6~~ million ~~and $1.1 million, respectively.~~during each period. The gain on insurance recovery and loss from hurricane damage were included in other (expense) income, net on the condensed consolidated statements of income.

8. Leases

The Company as Lessor

Leasing revenue consists of rental revenue from multi-family, senior living, self-storage, retail, office and commercial property, cell towers and other assets, which is recognized as earned, using the straight-line method over the life of each lease. The Company’s leases have remaining lease terms up to the year 2040, some of which include options to terminate or extend.

The components of leasing revenue are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2021		2020		2021		2020		2022		2021
Leasing revenue
Lease payments	$	5,904	$	3,874	$	15,541	$	11,027	$	7,379	$	4,466
Variable lease payments		1,242		1,089		3,571		3,142		1,443		1,128
Total leasing revenue	$	7,146	$	4,963	$	19,112	$	14,169	$	8,822	$	5,594

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Minimum future base rental revenue on non-cancelable leases subsequent to ~~September 30, 2021,~~March 31, 2022, for the years ending December 31 are:



2021	$	5,418
2022		15,776	$	16,012
2023		10,995		12,541
2024		9,087		9,900
2025		6,328		6,904
2026				5,275
Thereafter		23,845		18,971
	$	71,449	$	69,603

The Company as Lessee

As of ~~September 30, 2021,~~March 31, 2022, the Company leased certain office and other equipment under finance leases and had operating leases for property and equipment used in corporate, hospitality and commercial operations with remaining lease terms up to the year 2049. Certain leases include options to purchase, terminate or renew for one or more years, which are included in the lease term used to establish right-of-use assets and lease liabilities when it is reasonably certain that the option will be exercised. Finance lease right-of-use assets are included within property, plant and equipment and operating lease right-of-use assets are included within other assets on the condensed consolidated balance sheets, which represent the Company’s right to use an underlying asset during a lease term for leases in excess of one year. Corresponding finance lease ~~liability~~liabilities and operating lease liabilities are included within other liabilities on the condensed consolidated balance sheets and are related to the Company’s obligation to make lease payments for leases in excess of one year. The Company uses its incremental borrowing rate to determine the present value of the lease payments since the rate implicit in each lease is not readily determinable. The Company recognizes short-term (twelve

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months or less) lease payments in profit or loss on a straight-line basis over the term of the lease and variable lease payments in the period in which the obligation for those payments is incurred.

The components of lease expense are as follows:



	Three Months Ended September 30,				Nine Months Ended September 30,						Three Months Ended March 31,
	2021		2020		2021			2020			2022			2021
Lease cost
Finance lease cost:
Amortization of right-of-use assets	$	29	$	13	$	85		$	38		$	29		$	27
Interest on lease liability		5		2		14			7			4			5
Operating lease cost		80		71		236			208			102			77
Short-term lease cost		518		473		1,262			823			192			193
Total lease cost	$	632	$	559	$	1,597		$	1,076		$	327		$	302

Other information
Weighted-average remaining lease term - finance lease (in years)						3.8			3.9			3.2			4.0
Weighted-average remaining lease term - operating leases (in years)						3.4			2.4			3.4			3.4
Weighted-average discount rate - finance lease						4.6	%		5.0	%		4.6	%		4.5	%
Weighted-average discount rate - operating leases						4.9	%		5.0	%		4.9	%		4.9	%

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The aggregate payments of finance and operating lease ~~liability~~liabilities subsequent to ~~September 30, 2021,~~March 31, 2022, for the years ending December 31 are:

2021

$
33
2022

133
2023

133
2024

87
2025

50
Thereafter

6
Total

442
Less imputed interest

(33)
Total finance lease liability

$
409

~~The aggregate payments of operating lease liabilities subsequent to September 30, 2021, for the years ending December 31 are:~~


2021	$	72
			Finance Leases		Operating Leases
2022		261	$	99	$	266
2023		220		131		315
2024		108		85		164
2025		51		48		51
2026				5		12
Thereafter		281		—		269
Total		993		368		1,077
Less imputed interest		(199)		(24)		(191)
Total operating lease liabilities	$	794
Total lease liabilities			$	344	$	886

~~9. Other Assets~~

~~Other assets consist of the following:~~

September 30,

December 31,

2021

2020
Restricted investments

$
—

$
1,171
Investments - equity securities

375

2,623
Accounts receivable, net

13,984

10,791
Homesite sales receivable

5,969

5,675
Notes receivable, net

15,115

10,877
Income tax receivable

117

—
Inventory

2,639

2,026
Prepaid expenses

8,054

7,135
Straight-line rent

2,511

3,174
Operating lease right-of-use assets

794

808
Other assets

5,860

5,743
Retained interest investments

13,544

12,905
Accrued interest receivable for Senior Notes held by SPE

935

2,938
Total other assets

$
69,897

$
65,866

~~Restricted Investments~~

~~As of December 31, 2020, the Company’s restricted investments were related to the Company’s deferred compensation plan~~. As part of the Pension Plan termination in 2014, the Company directed the Pension Plan to transfer the Pension Plan’s surplus assets into a suspense account in the Company’s 401(k) plan. The Company retained the risks and rewards of ownership of these assets; therefore, the assets held in the suspense account were included in the

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~~Company’s condensed consolidated balance sheets until they were allocated to 401(k) plan participants. The final allocation~~9. Other Assets

Other assets consist of the assets occurred in March 2021. During both the nine months ended September 30, 2021 and 2020, the Company recorded an expense of $1.2 million for the fair value of the assets, less expenses, that were allocated to participants. Refer to Note 6. ~~Financial Instruments and Fair Value Measurements~~.following:


	March 31,		December 31,
	2022		2021
Investments - equity securities	$	474	$	450
Accounts receivable, net		13,765		13,813
Homesite sales receivable		8,835		7,651
Notes receivable, net		4,770		12,377
Inventory		3,325		2,797
Prepaid expenses		7,907		7,175
Straight-line rent		2,569		2,489
Operating lease right-of-use assets		886		732
Other assets		12,336		5,987
Retained interest investments		14,073		13,826
Accrued interest receivable for Senior Notes held by SPE		935		2,938
Total other assets	$	69,875	$	70,235

Investments - Equity Securities

As of ~~September 30, 2021~~both March 31, 2022 and December 31, ~~2020,~~2021 investments - equity securities included ~~$0.4~~$0.5 million ~~and $2.6 million, respectively,~~ of preferred stock investments recorded at fair value. During the three ~~and nine~~ months ended ~~September 30, 2021,~~March 31, 2022, the Company recognized unrealized gain of less than $0.1 million ~~and unrealized loss of $0.9 million, respectively,~~ on investments related to equity securities still held as of ~~September 30, 2021.~~March 31, 2022. During the three ~~and nine~~ months ended ~~September 30, 2020,~~March 31, 2021, the Company recognized unrealized ~~gain of $0.3 million and unrealized~~ loss of ~~$4.5~~$1.0 million ~~respectively,~~ on investments related to equity securities still held as of ~~September 30, 2020.~~March 31, 2021. These amounts were included within investment income, net on the condensed consolidated statements of income.

Accounts Receivable, Net

The Company’s accounts receivable, net primarily ~~include receivables related to certain homesite sales,~~includes leasing receivables, membership initiation fees, hospitality receivables and other receivables. At each reporting period, accounts receivable in the scope of Topic 326 are pooled by type and judgements are made based on historical losses and expected credit losses based on economic trends to determine the allowance for credit losses primarily using the aging method. Actual losses could differ from those estimates. Write-offs are recorded when the Company concludes that all or a portion of the receivable is no longer collectible and recoveries on receivables previously charged-off are credited to the allowance. As of both ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, accounts receivable were presented net of allowance for credit losses of ~~$0.2~~$0.4 million and net of allowance for lease related receivables of $0.1 million. During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, allowance for credit losses related to accounts receivable, net increased less than $0.1 million.

Homesite Sales Receivable

Homesite sales receivable from contracts with customers include estimated homesite residuals and certain estimated fees that are recognized as revenue at the time of sale to homebuilders, subject to constraints. Any change in circumstances from the estimated amounts will be updated at each reporting period. The receivable will be collected as the homebuilders build the homes and sell to retail consumers, which can occur over multiple years.

The following table presents the changes in homesite sales receivable:

Increases Due To

Decreases Due to

Balance

Revenue Recognized

Amounts

Balance

January 1, 2021

for Homesites Sold

Received/Transferred

September 30, 2021
Homesite sales receivable

$
5,675

$
3,670

$
(3,376)

$
5,969

Increases Due To

Decreases Due to

Balance

Revenue Recognized

Amounts

Balance

January 1, 2020

for Homesites Sold

Received/Transferred

September 30, 2020
Homesite sales receivable

$
5,211

$
2,116

$
(2,276)

$
5,051


	March 31, 2022		March 31, 2021
Balance at beginning of period	$	7,651	$	5,675
Increases due to revenue recognized for homesites sold		2,375		1,768
Decreases due to amounts received		(1,191)		(987)
Balance at end of period	$	8,835	$	6,456

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Notes Receivable, Net

Notes receivable, net consists of the following:


	September 30,		December 31,		March 31,		December 31,
	2021		2020		2022		2021
Interest bearing revolving promissory note with the unconsolidated Latitude Margaritaville Watersound JV, secured by the JV's real property — bearing interest at a rate of 5.0%, matures June 2025	$	8,556	$	2,714	$	—	$	7,075
Various interest bearing homebuilder notes, secured by the real estate sold — bearing interest at a rate of 5.5%, due July 2022 through May 2023		5,885		7,544
Interest bearing notes with JV partners, secured by the partner's membership interest in the JV — bearing interest at a rate of 8.0%, due May 2039 through July 2039		549		556
Various interest bearing homebuilder notes, secured by the real estate sold — bearing interest at a rate of 5.5%, due September 2022 through May 2023						4,303		4,824
Interest bearing notes with JV partner, secured by the partner's membership interest in the JV — bearing interest at a rate of 8.0%, due May 2039						359		359
Non-interest bearing note with a tenant for tenant improvements, due October 2025		78		—		74		76
Various mortgage notes, secured by certain real estate, bearing interest at rates of 5.2% to 6.7%, due December 2022 through November 2023		47		63
Mortgage note, secured by certain real estate, bearing interest at a rate of 4.7% due November 2023						34		43
Total notes receivable, net	$	15,115	$	10,877	$	4,770	$	12,377

In June 2020, the Company entered into a $10.0 million secured revolving promissory note ~~(the “Latitude Margaritaville Watersound JV Note”)~~ with the unconsolidated Latitude Margaritaville Watersound JV. The Latitude ~~Margaritaville Watersound~~ JV Note was provided to finance the development of the pod-level, non-spine ~~infrastructure, which~~infrastructure. Future advances, if any, will be repaid by the JV as each home is sold by the JV, with the aggregate unpaid principal and all accrued and unpaid interest due at maturity in June 2025. The Latitude ~~Margaritaville Watersound~~ JV Note is secured by a mortgage and security interest in and on the real property and improvements located on the real property of the JV. See Note 4. Joint Ventures for additional information.

The Company may allow homebuilders to pay for homesites during the home construction period in the form of homebuilder notes. The Company evaluates the carrying value of all notes receivable and the need for an allowance for credit losses at each reporting ~~date.~~period. As of ~~September 30, 2021~~both March 31, 2022 and December 31, ~~2020,~~2021, notes receivable were presented net of allowance for credit losses of $0.1 million. As of ~~September 30, 2021~~both March 31, 2022 and December 31, ~~2020,~~2021, accrued interest receivable related to notes receivable was ~~$0.4~~$0.1 million, ~~and $0.2 million, respectively, and~~which is included within other assets on the condensed consolidated balance sheets.

Retained Interest Investments

The Company has a beneficial interest in certain bankruptcy-remote qualified SPEs used in the installment sale monetization of certain sales of timberlands in 2007 and 2008. The SPEs’ assets are not available to satisfy the Company’s liabilities or obligations and the liabilities of the SPEs are not the Company’s liabilities or obligations. Therefore, the SPEs’ assets and liabilities are not consolidated in the Company’s condensed consolidated financial statements as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021. The Company’s continuing involvement with the SPEs is the receipt of the net interest payments and the remaining principal of approximately ~~$16.5~~$16.9 million to be received at the end of the installment notes’ ~~fifteen year~~fifteen-year maturity period, in 2022 through 2024. The Company has a beneficial or retained interest investment related to these SPEs of ~~$13.5~~$14.1 million and ~~$12.9~~$13.8 million as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, respectively, recorded in other assets on the Company’s condensed consolidated balance sheets.

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10. Debt, Net

Debt consists of the following:

September 30, 2021

December 31, 2020




Unamortized



Unamortized


Discount and

Discount and

Debt Issuance

Debt Issuance

Principal

Costs

Net

Principal

Costs

Net
PPN JV Loan, due November 2025, bearing interest at 4.1%

$
43,832

$
264

$
43,568

$
44,568

$
314

$
44,254
Watersound Origins Crossings JV Loan, due May 2024, bearing interest at 5.0%

36,319

274

36,045

27,179

351

26,828
PPC JV Loan, insured by HUD, due June 2060, bearing interest at 3.1% as of September 30, 2021

35,791

1,063

34,728

36,084

1,079

35,005
Watercrest JV Loan, due June 2047, bearing interest at LIBOR plus 2.2% and swapped to a fixed rate of 4.4%

19,583

330

19,253

18,066

284

17,782
PPC II JV Loan, due October 2024, bearing interest at LIBOR plus 2.1% (effective rate of 2.2% at September 30, 2021)

17,390

160

17,230

15,921

198

15,723
Airport Hotel Loan, due March 2025, bearing interest at LIBOR plus 2.0%, with a floor rate of 3.0% (effective rate of 3.0% at September 30, 2021)

14,642

137

14,505

3,548

168

3,380
Breakfast Point Hotel Loan, due November 2042, bearing interest at LIBOR plus 2.8%, with a floor rate of 3.8% (effective rate of 3.8% at September 30, 2021)

8,252

194

8,058

—

—

—
Beckrich Building III Loan, due August 2029, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)

5,247

54

5,193

5,421

59

5,362
Community Development District debt, secured by certain real estate or other collateral, due May 2023 through May 2039, bearing interest at 3.6% to 6.0%

5,015

—

5,015

6,294

—

6,294
The Lodge 30A JV Loan, due January 2028, bearing interest at 3.8%

4,493

186

4,307

—

—

—
Self-Storage Facility Loan, due November 2025, bearing interest at LIBOR plus 2.5%, with a floor rate of 3.0% (effective rate of 3.0% at September 30, 2021)

4,135

74

4,061

—

—

—
Beach Homes Loan, due May 2029, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)

1,505

16

1,489

1,545

17

1,528
Pier Park Outparcel Construction Loan, due March 2027, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)

1,393

11

1,382

1,458

12

1,446
WaterColor Crossings Construction Loan, due February 2029, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)

1,283

18

1,265

1,334

21

1,313
Total debt

$
198,880

$
2,781

$
196,099

$
161,418

$
2,503

$
158,915


	Maturity Date	Interest Rate Terms	Effective Rate March 31, 2022		March 31, 2022		December 31, 2021
Watersound Origins Crossings JV Loan	May 2024	SOFR plus 2.8, floor 3.3%^(a)	3.3	%	$	44,015	$	37,897
PPN JV Loan	November 2025	Fixed	4.1	%		43,329		43,582
PPC JV Loan (insured by HUD)	June 2060	Fixed	3.1	%		35,550		35,670
Watercrest JV Loan	June 2047	LIBOR plus 2.2%, swapped to a fixed rate of 4.4%	4.4	%		20,263		20,053
Pier Park Resort Hotel JV Loan	April 2027	LIBOR plus 2.2%	2.6	%		20,087		14,650
PPC II JV Loan	October 2024	LIBOR plus 2.1%	2.6	%		17,325		17,374
Airport Hotel Loan	March 2025	LIBOR plus 2.0%, floor 3.0%	3.0	%		14,642		14,642
Breakfast Point Hotel Loan	November 2042	LIBOR plus 2.8%, floor 3.8%	3.8	%		13,736		11,843
Watersound Camp Creek Loan	December 2047	LIBOR plus 2.1%, floor 2.6%	2.6	%		10,293		3,437
Lodge 30A JV Loan	January 2028	Fixed	3.8	%		10,262		7,474
North Bay Landing Apartments Loan	September 2024	LIBOR plus 2.5%, floor 3.2%	3.2	%		5,146		1,342
Beckrich Building III Loan	August 2029	LIBOR plus 1.7%	2.2	%		5,129		5,188
Community Development District debt	May 2022-May 2039	Fixed	3.6 to 6.0	%		4,894		4,909
Self-Storage Facility Loan	November 2025	LIBOR plus 2.4%, floor 2.9%	2.9	%		4,666		4,666
Watersound Town Center Grocery Loan	August 2031	LIBOR plus 2.0%, floor 2.2%	2.4	%		4,525		620
Mexico Beach Crossings JV Loan (insured by HUD)	March 2064	Fixed	3.0	%		4,157		—
Beach Homes Loan	May 2029	LIBOR plus 1.7%	2.2	%		1,478		1,492
Pier Park Outparcel Loan	March 2027	LIBOR plus 1.7%	2.2	%		1,348		1,370
WaterColor Crossings Loan	February 2029	LIBOR plus 1.7%	2.2	%		1,246		1,265
Total principal outstanding						262,091		227,474
Unamortized discount and debt issuance costs						(5,328)		(4,440)
Total debt, net					$	256,763	$	223,034

(a)	In January 2022, the Watersound Origins Crossings JV Loan interest rate was modified from a fixed rate of 5.0% as of December 31, 2021.

In May 2019, the Watersound Origins Crossings JV entered into a $37.9 million loan (the “Watersound Origins Crossings JV Loan”) to finance the construction of apartments located near the entrance to the Watersound Origins residential community. In January 2022, the Watersound Origins Crossings JV entered into a modification of the Watersound Origins Crossings JV Loan, that increased the principal amount of the loan to $44.0 million, modified the interest rate from 5.0% to the Secured Overnight Financing Rate (“SOFR”) plus 2.8%, with a floor of 3.3% and provides for payments of interest only with a final balloon payment at maturity in May 2024. The Watersound Origins Crossings JV Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Watersound Origins Crossings JV Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Watersound Origins Crossings JV Loan. As guarantor, the Company may request a reduction of the Company’s liability under the Watersound Origins Crossings JV Loan to either 50% or 25% of the outstanding principal amount based on meeting certain debt service coverage and loan to value requirements. In addition, the guarantee can become full recourse in the case of any fraud or intentional misrepresentation or failure to abide by other certain obligations on the part of such guarantor. The Company is the sole guarantor and receives a monthly fee related to the guarantee from its JV partner based on the JV partner’s ownership

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percentage. As of March 31, 2022, the Company incurred less than $0.1 million of additional loan cost due to the Watersound Origins Crossings JV Loan modification.

In October 2015, the Pier Park North JV entered into a $48.2 million loan (the “PPN JV Loan”), secured by a first lien on, and security interest in, a majority of the Pier Park North JV’s property. The PPN JV Loan provides for principal and interest payments with a final balloon payment at ~~maturity.~~maturity in November 2025. In connection with the PPN JV Loan, the Company entered into a limited guarantee in favor of the lender, based on its percentage ownership of the JV. In addition, the guarantee can become full recourse in the case of any fraud or intentional misrepresentation by the Pier Park North JV; any voluntary transfer or encumbrance of the property in violation of the due-on-sale clause in the security instrument; upon commencement of voluntary bankruptcy or insolvency proceedings and upon breach of covenants in the security instrument.

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In May 2019, the Watersound Origins Crossings JV entered into a $37.9 million loan (the “Watersound Origins Crossings JV Loan”) to finance the construction of apartments in Watersound, Florida. The Watersound Origins Crossings JV Loan provides for interest only payments for the first thirty-two months and principal and interest payments thereafter with a final balloon payment at maturity in May 2024. The Watersound Origins Crossings JV Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Watersound Origins Crossings JV Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Watersound Origins Crossings JV Loan. The Company is the sole guarantor and receives a monthly fee related to the guarantee from its JV partner based on the JV partner’s ownership percentage.

In May 2018, the Pier Park Crossings JV entered into a $36.6 million loan, insured by the U.S. Department of Housing and Urban Development (“HUD”), to finance the construction of apartments in Panama City Beach, Florida (the “PPC JV Loan”). The PPC JV Loan provides for monthly principal and interest payments through maturity in June 2060. In August 2021, the Pier Park Crossings JV entered into a modification of the PPC JV Loan, that reduced the interest rate from 4.0% to 3.1% and revised the prepayment provisions. Prior to the modification, a prepayment premium was due to the lender of 1% - 9% of any prepaid principal through June 30, 2030. The ~~modification revised the prepayment provision to include that the~~ PPC JV Loan may not be prepaid prior to September 1, 2022 and if any additional principal is prepaid from September 1, 2022 through August 31, 2031 a premium is due to the lender of 2% - 10% ~~of any prepaid principal.~~. The PPC JV Loan is secured by the Pier Park Crossings JV’s real property and the assignment of rents and leases. ~~As of September 30, 2021, the Company incurred less than $0.1 million of additional loan cost due to the PPC JV Loan modification.~~

In June 2019, the Watercrest JV entered into a $22.5 million loan (the “Watercrest JV Loan”) to finance the construction of a senior living facility in Santa Rosa Beach, Florida. The Watercrest JV Loan provides for interest only payments for the first thirty-six months and principal and interest payments thereafter through maturity in June 2047. The Watercrest JV Loan is secured by the real property, assignment of rents, leases and deposits and the security interest in the rents and personal property. In connection with the Watercrest JV Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Watercrest JV Loan. The Company is the sole guarantor and receives a quarterly fee related to the guarantee from its JV partner based on the JV partner’s ownership percentage. The Watercrest JV entered into an interest rate swap to hedge cash flows tied to changes in the underlying floating interest rate tied to LIBOR. The interest rate swap was effective June 1, 2021 and matures on June 1, 2024 and fixed the variable rate on the notional amount of related debt of $20.0 million to a rate of 4.4%. See Note 6. Financial Instruments and Fair Value Measurements for additional information.

In April 2020, the Pier Park Resort Hotel JV entered into a loan with an initial amount of $52.5 million and up to a maximum of $60.0 million through additional earn-out requests (the “Pier Park Resort Hotel JV Loan”). The Pier Park Resort Hotel JV Loan was entered into to finance the construction of an Embassy Suites by Hilton hotel in the Pier Park area of Panama City Beach, Florida. The Pier Park Resort Hotel JV Loan provides for interest only payments for the first thirty-six months and principal and interest payments thereafter with a final balloon payment at maturity in April 2027. The Pier Park Resort Hotel JV Loan is secured by the real property, assignment of rents and leases and the security interest in the rents, leases and personal property. In connection with the Pier Park Resort Hotel JV Loan, as guarantors, the Company and the Company’s JV partner entered into a guarantee based on each partner’s ownership interest in favor of the lender, to guarantee the payment and performance of the borrower. As guarantor, the Company’s liability under the Pier Park Resort Hotel JV Loan will be released upon reaching and maintaining certain debt service coverage for twelve months. In addition, the guarantee can become full recourse in the case of the failure of the guarantors to abide by or perform any of the covenants or warranties to be performed on the part of such guarantor. The Pier Park Resort Hotel JV entered into an interest rate swap to hedge cash flows tied to changes in the underlying floating interest rate tied to LIBOR. The interest rate swap is effective December 10, 2022 and matures on April 12, 2027 and fixed the variable rate on the notional amount of related debt of $42.0 million to a rate of 3.2%. See Note 6. Financial Instruments and Fair Value Measurements for additional information.

In October 2019, the Pier Park Crossings Phase II JV entered into a $17.5 million loan (the “PPC II JV Loan”) to finance the construction of apartments in Panama City Beach, Florida. The PPC II JV Loan provides for ~~interest only payments for the first twenty-four months and~~monthly principal and interest payments ~~thereafter~~ with a final balloon payment at maturity in October 2024. The PPC II JV Loan is secured by the real property, assignment of rents and leases and the security interest in the rents, leases and personal property. In connection with the PPC II JV Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the PPC II JV Loan. As guarantor, the Company’s liability under the PPC II JV Loan ~~was reduced to~~is 50% of the outstanding principal amount ~~upon satisfaction of final advance conditions in April 2021~~ and will be reduced to 25% of the outstanding principal amount upon

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reaching and maintaining a certain debt service coverage ratio. The Company is the sole guarantor and receives a monthly fee related to the guarantee from its JV partner based on the JV partner’s ownership percentage. The Pier Park Crossings Phase II JV is in the process of refinancing the PPC II JV Loan, which will be a HUD insured loan.

In March 2020, a wholly-owned subsidiary of the Company entered into a $15.3 million loan (the “Airport Hotel Loan”) to finance construction of the Hilton Garden Inn Panama City Airport. The Airport Hotel Loan provides for interest only payments for the first thirty-six months and principal and interest payments thereafter with a final balloon payment at maturity in March 2025. The Airport Hotel Loan is secured by the real property, assignment of leases, rents and profits and the security interest in the rents and personal property. In connection with the Airport Hotel Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Airport Hotel Loan.

In November 2020, a wholly-owned subsidiary of the Company entered into a $16.8 million ~~construction~~ loan to finance the construction of a ~~HomeWood~~Homewood Suites by Hilton hotel in the Breakfast Point area of Panama City Beach, Florida (the “Breakfast Point Hotel Loan”). The Breakfast Point Hotel Loan provides for interest only payments for the

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first twenty-four months and principal and interest payments thereafter through maturity in November 2042. The Breakfast Point Hotel Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Breakfast Point Hotel Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Breakfast Point Hotel Loan.

In June 2021, a wholly-owned subsidiary of the Company entered into a $28.0 million loan to finance the construction of Watersound Camp Creek, which includes an inn and amenity center near the Watersound Camp Creek residential community (the “Watersound Camp Creek Loan”). The Watersound Camp Creek Loan provides for interest only payments for the first eighteen months and principal and interest payments thereafter through maturity in December 2047. The Watersound Camp Creek Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Watersound Camp Creek Loan, the Company executed a guarantee in favor of the lender to guarantee completion of the project and the payment of the borrower under the Watersound Camp Creek Loan. As guarantor, the Company’s liability under the Watersound Camp Creek Loan will be reduced to 50% of the outstanding principal amount upon the project reaching and maintaining a trailing six months of operations with a certain debt service coverage ratio and reduced to 25% of the outstanding principal amount upon reaching and maintaining a trailing twelve months of operations of a certain debt service coverage ratio. In addition, the guarantee can become full recourse in the case of the failure of guarantor to abide by or perform any of the covenants, warranties or other certain obligations to be performed on the part of such guarantor.

In January 2021, The Lodge 30A JV entered into a $15.0 million loan to finance the construction of a boutique hotel in Seagrove Beach, Florida (the “Lodge 30A JV Hotel Loan”). The Lodge 30A JV Hotel Loan provides for interest only payments for the first twenty-four months and principal and interest payments thereafter with a final balloon payment at maturity in January 2028. The Lodge 30A JV Hotel Loan is secured by the real property, assignment of leases and rents and the security interest in the rents and personal property. In connection with the Lodge 30A JV Hotel Loan, the Company, wholly-owned subsidiaries of the Company and the Company’s JV partner entered into a joint and several payment and performance guarantee in favor of the lender. Upon reaching a certain debt service coverage ratio for a minimum of twenty-four months, the Company’s liability as guarantor will be reduced to 75% of the outstanding principal amount for a twelve-month period. The debt service coverage ratio will be tested annually thereafter and the Company’s liability will be reduced to 50% in year four and 25% in year five. The Company receives a monthly fee related to the guarantee from its JV partner based on the JV partner’s ownership percentage.

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North Bay Landing Apartments Loan. As guarantor, the Company’s liability under the North Bay Landing Apartments Loan will be reduced to 50% of the principal amount upon satisfaction of final advance conditions and reduced to 25% of the outstanding principal amount upon reaching and maintaining a certain debt service coverage ratio. In addition, the guarantee can become full recourse in the case of any fraud or intentional misrepresentation or failure to abide by other certain obligations on the part of such guarantor.

In August 2019, a wholly-owned subsidiary of the Company entered into a $5.5 million loan (the “Beckrich Building III Loan”) to finance the construction of an office building in Panama City Beach, Florida. The Beckrich Building III Loan provides for monthly principal and interest payments with a final balloon payment at maturity in August 2029. The Beckrich Building III Loan is secured by the real property, assignment of leases, rents and profits and the security interest in the rents and personal property. In connection with the Beckrich Building III Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Beckrich Building III Loan.

Community Development District (“CDD”) bonds financed the construction of infrastructure improvements at some of the Company’s projects. The principal and interest payments on the bonds are paid by assessments on the properties benefited by the improvements financed by the bonds. CDD debt is secured by certain real estate or other collateral. The Company has recorded a liability for CDD debt that is associated with platted property, which is the point at which it becomes fixed and determinable. Additionally, the Company has recorded a liability for the portion of the CDD debt that is associated with unplatted property if it is probable and reasonably estimable that the Company will ultimately be responsible for repayment. The Company’s total CDD debt assigned to property it owns was ~~$14.2~~$14.0 million and ~~$15.8~~$14.1 million as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, respectively. The Company pays interest on this total outstanding CDD debt.

In January 2021, The Lodge 30A JV entered into a $15.0 million construction loan to finance the construction of a boutique hotel in Seagrove Beach, Florida (the “Lodge 30A JV Hotel Loan”). The Lodge 30A JV Hotel Loan provides for interest only payments for the first twenty-four months and principal and interest payments thereafter with a final balloon payment at maturity in January 2028. The Lodge 30A JV Hotel Loan is secured by the real property, assignment of leases and rents and the security interest in the rents and personal property. In connection with the Lodge 30A JV Hotel Loan, the Company, wholly-owned subsidiaries of the Company and the Company’s JV partner entered into a joint and several payment and performance guarantee in favor of the lender. Upon reaching a certain debt service coverage ratio for a minimum of twenty-four months, the Company’s liability as guarantor will be reduced to 75% for a twelve-month period. The debt service coverage ratio will be tested annually thereafter and the Company’s liability will be reduced to 50% in year four and 25% in year five. The Company receives a monthly fee related to the guarantee from its JV partner based on the JV partner’s ownership percentage.

In November 2020, a wholly-owned subsidiary of the Company entered into a $5.8 million ~~construction~~ loan to finance the construction of a self-storage facility in Santa Rosa Beach, Florida (the “Self-Storage Facility Loan”). The Self-Storage Facility Loan provides for interest only payments for the first forty-eight months and principal and interest payments thereafter with a final balloon payment at maturity in November 2025. The Self-Storage Facility Loan is secured by the real property, assignment of leases and rents and the security interest in the rents and personal property. In connection with the Self-Storage Facility Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Self-Storage Facility Loan. The Company’s liability as guarantor under the Self-Storage Facility Loan shall not exceed $2.9 million, plus any additional fees, upon reaching and maintaining certain debt service coverage.

In May 2018, a wholly-owned subsidiary of the Company entered into a $1.7 million construction loan to finance the construction of 2 beach homes located in Panama City Beach, Florida (the “Beach Homes Loan”). The Beach Homes Loan provides for monthly principal and interest payments with a final balloon payment at maturity in May 2029. The Beach Homes Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Beach Homes Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Beach Homes Loan.

In March 2017, a wholly-owned subsidiary of the Company entered into a $1.6 million construction loan to finance the construction of a commercial leasing property located in Panama City Beach, Florida (the “Pier Park Outparcel Construction Loan”). The Pier Park Outparcel Construction Loan provides for monthly principal and interest payments

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with a final balloon payment at maturity in March 2027. The Pier Park Outparcel Construction Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property.

In February 2018, a wholly-owned subsidiary of the Company entered into a $1.9 million construction loan to finance the construction of a commercial leasing property located in Santa Rosa Beach, Florida (the “WaterColor Crossings Construction Loan”). The WaterColor Crossings Construction Loan provides for monthly principal and interest payments with a final balloon payment at maturity in February 2029. The WaterColor Crossings Construction Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the WaterColor Crossings Construction Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the WaterColor Crossings Construction Loan.

In April 2020, the Pier Park Resort Hotel JV entered into a loan with an initial amount of $52.5 million up to a maximum of $60.0 million through additional earn-out requests (the “Pier Park Resort Hotel JV Loan”). The Pier Park Resort Hotel JV Loan was entered into to finance the construction of an Embassy Suites by Hilton hotel in the Pier Park area of Panama City Beach, Florida. The Pier Park Resort Hotel JV Loan provides for interest only payments for the first thirty-six months and principal and interest payments thereafter with a final balloon payment at maturity in April 2027. The Pier Park Resort Hotel JV Loan is secured by the real property, assignment of rents and leases and the security interest in the rents, leases and personal property. In connection with the Pier Park Resort Hotel JV Loan, as guarantor, the Company and the Company’s JV partner entered into a guarantee based on each partner’s ownership interest in favor of the lender, to guarantee the payment and performance of the borrower. As guarantor, the Company’s liability under the Pier Park Resort Hotel JV Loan will be released upon reaching and maintaining certain debt service coverage for twelve months. In addition, the guarantee can become full recourse in the case of the failure of guarantor to abide by or perform any of the covenants or warranties to be performed on the part of such guarantor. The Pier Park Resort Hotel JV entered into an interest rate swap to hedge cash flows tied to changes in the underlying floating interest rate tied to LIBOR. The interest rate swap is effective December 10, 2022 and matures on April 12, 2027 and fixed the variable rate on the notional amount of related debt of $42.0 million to a rate of 3.2%. As of September 30, 2021 and December 31, 2020, there was 0 principal balance and the Company had incurred $1.0 million of loan costs related to the Pier Park Resort Hotel JV Loan.

In March 2021, a wholly-owned subsidiary of the Company entered into a $26.8 million construction loan to finance the construction of apartments in Panama City, Florida (the “North Bay Landing Apartments Loan”, formerly referenced as “Star Avenue”). The North Bay Landing Apartments Loan provides for interest only payments and a principal balloon payment at maturity in September 2024. The North Bay Landing Apartments Loan includes an option for an extension of the maturity date by eighteen months, subject to certain conditions, that would provide for principal and interest payments commencing on the original maturity date with a final balloon payment at the extended maturity date. The North Bay Landing Apartments Loan is secured by the real property, assignment of rents and leases and the security interest in the rents, leases and personal property. In connection with the North Bay Landing Apartments Loan, the Company executed a guarantee in favor of the lender to guarantee completion of the project and the payment and performance of the borrower under the North Bay Landing Apartments Loan. As guarantor, the Company’s liability under the North Bay Landing Apartments Loan will be reduced to 50% of the principal amount upon satisfaction of final advance conditions and reduced to 25% of the principal amount upon reaching and maintaining a certain debt service coverage ratio. In addition, the guarantee can become full recourse in the case of any fraud or intentional misrepresentation or failure to abide by other certain obligations on the part of such guarantor. As of September 30, 2021, there was 0 principal balance and the Company had incurred $0.3 million of loan costs related to the North Bay Landing Apartments Loan.

In June 2021, a wholly-owned subsidiary of the Company entered into a $28.0 million construction loan to finance the construction of the Camp Creek Inn and amenity center in Watersound, Florida (the “Camp Creek Inn Loan”). The Camp Creek Inn Loan provides for interest only payments for the first eighteen months and principal and interest payments thereafter through maturity in December 2047. The Camp Creek Inn Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Camp Creek Inn Loan, the Company executed a guarantee in favor of the lender to guarantee completion of the project and the payment of the borrower under the Camp Creek Inn Loan. As guarantor, the Company’s liability under the Camp Creek Inn Loan will be reduced to 50% of the principal amount upon the project reaching and maintaining a trailing six months operations with a certain debt service coverage ratio and reduced to 25% of the principal amount upon reaching and

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maintaining a trailing twelve months operations of a certain debt service coverage ratio. In addition, the guarantee can become full recourse in the case of the failure of guarantor to abide by or perform any of the covenants, warranties or other certain obligations to be performed on the part of such guarantor. As of September 30, 2021, there was 0 principal balance and the Company had incurred $0.4 million of loan costs related to the Camp Creek Inn Loan.

In August 2021, a wholly-owned subsidiary of the Company entered into a $12.0 million ~~construction~~ loan to finance the construction of a ~~grocery~~ building in the Watersound Town Center innear the Watersound ~~Florida~~Origins residential community (the “Watersound Town Center Grocery Loan”). The Watersound Town Center Grocery Loan provides for interest only payments for the first twenty-four months and principal and interest payments thereafter with a final balloon payment at maturity in August 2031. The Watersound Town Center Grocery Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Watersound Town Center Grocery Loan, the Company executed a guarantee in favor of the lender to guarantee completion of the project and the payment and performance of the borrower under the Watersound Town Center Grocery Loan. As guarantor, the Company’s liability under the Watersound Town Center Grocery Loan will be reduced to 50% of the outstanding principal amount upon satisfaction of final advance conditions, issuance of the certificate of occupancy for the project and receipt of the initial base rent payment and reduced to 25% of the outstanding principal amount upon reaching a certain debt service coverage ratio and the project maintaining 93% occupancy for ninety consecutive days.

In January 2022, the Mexico Beach Crossings JV entered into a $43.5 million loan, insured by HUD, to finance the construction of apartments in Mexico Beach, Florida (the “Mexico Beach Crossings JV Loan”). The Mexico Beach Crossings JV Loan provides for interest only payments for the first twenty-seven months and principal and interest payments thereafter through maturity in March 2064. The Mexico Beach Crossings JV Loan may not be prepaid prior to April 1, 2024 and if any additional principal is prepaid from April 1, 2024 through March 31, 2034 a premium is due to the lender of 1% - 10%. The Mexico Beach Crossings JV Loan is secured by the Mexico Beach Crossings JV’s real property and the assignment of rents and leases.

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In May 2018, a wholly-owned subsidiary of the Company entered into a $1.7 million loan to finance the construction of 2 beach homes located in Panama City Beach, Florida (the “Beach Homes Loan”). The Beach Homes Loan provides for monthly principal and interest payments with a final balloon payment at maturity in May 2029. The Beach Homes Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Beach Homes Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Beach Homes Loan.

In March 2017, a wholly-owned subsidiary of the Company entered into a $1.6 million loan to finance the construction of a commercial leasing property located in Panama City Beach, Florida (the “Pier Park Outparcel Loan”). The Pier Park Outparcel Loan provides for monthly principal and interest payments with a final balloon payment at maturity in March 2027. The Pier Park Outparcel Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property.

In February 2018, a wholly-owned subsidiary of the Company entered into a $1.9 million loan to finance the construction of a commercial leasing property located in Santa Rosa Beach, Florida (the “WaterColor Crossings Loan”). The WaterColor Crossings Loan provides for monthly principal and interest payments with a final balloon payment at maturity in February 2029. The WaterColor Crossings Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the WaterColor Crossings Loan, the Company executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the WaterColor Crossings Loan.

In October 2021, a wholly-owned subsidiary of the Company entered into a $21.2 million loan to finance the construction of a hotel in Panama City, Florida (the “Hotel Indigo Loan”). The Hotel Indigo Loan provides for interest only payments for the first twenty-four months and principal and interest payments thereafter with a final balloon payment at maturity in October 2028. The Hotel Indigo Loan includes an option for an extension of the maturity date by sixty months, subject to certain conditions, which would provide for continued principal and interest payments with a final balloon payment at the extended maturity date. The Hotel Indigo Loan is secured by the leasehold property, assignment of rents, leases, deposits, permits, plans, fees, agreements, approvals and contracts and the security interest in the personal property and rents. In connection with the Hotel Indigo Loan, the Company executed a guarantee in favor of the lender to guarantee completion of the project and the payment and performance of the borrower under the Hotel Indigo Loan. As of ~~September 30,~~March 31, 2022 and December 31, 2021, there was 0 principal balance and the Company had incurred ~~$0.2~~$0.3 million of loan costs related to the ~~Watersound Town Center Grocery~~Hotel Indigo Loan.

The Company’s financing agreements are subject to various customary debt covenants and as of both ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company was in compliance with the financial debt covenants.

As of ~~September 30, 2021,~~March 31, 2022, assets that were pledged as collateral related to the Company’s debt agreements, including unfunded commitments, had an approximate carrying amount of ~~$315.0~~$382.6 million. These assets are included within investment in real estate, net and property and equipment, net on the condensed consolidated balance sheets.

The aggregate maturities of debt subsequent to ~~September 30, 2021,~~March 31, 2022, for the years ending December 31 are:


	September 30,
	2021
2021	$	506
2022		3,612	$	2,520
2023		5,345		5,280
2024		57,070		72,109
2025		61,758		63,530
2026				4,723
Thereafter		70,589		113,929
	$	198,880	$	262,091

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11. Other Liabilities

Other liabilities consist of the following:


	September 30,		December 31,		March 31,		December 31,
	2021		2020		2022		2021
Accounts payable	$	36,957	$	25,376	$	46,056	$	48,597
Finance lease liability		409		316
Income tax payable						3,175		681
Finance lease liabilities						344		380
Operating lease liabilities		794		808		886		732
Accrued compensation		4,168		3,337		2,820		4,877
Other accrued liabilities		7,809		6,892		4,363		4,126
Deferred revenue		14,864		16,632
Club initiation fees		19,823		10,716
Club membership deposits		3,867		3,764		3,636		3,602
Advance deposits		2,355		1,344		5,806		2,140
Accrued interest expense for Senior Notes held by SPE		712		2,850		713		2,850
Total other liabilities	$	91,758	$	72,035	$	67,799	$	67,985

Accounts payable as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, includes payables for projects under development and ~~construction.~~construction such as the Embassy Suites by Hilton hotel, the Camp Creek Inn and amenity center, Watersound Town Center and the Watersound Origins residential community.

Other accrued liabilities include ~~$4.3~~$1.6 million and ~~$0.1~~$0.2 million of accrued property taxes as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, respectively, which are generally paid annually in November.

Deferred revenue as of September 30, 2021 and December 31, 2020, includes $10.9 million and $11.5 million, respectively, related to a 2006 agreement pursuant to which the Company agreed to sell land to the Florida Department of Transportation. Revenue is recognized when title to a specific parcel is legally transferred.

Club initiation fees are recognized as revenue over the estimated average duration of membership, which is evaluated periodically. The following table presents the changes in club initiation fees related to contracts with customers:

Club Initiation Fees
Balance as of January 1, 2021

$
10,716
New club memberships

12,283
Revenue from amounts included in contract liability opening balance

(2,310)
Revenue from current period new memberships

(866)
Balance as of September 30, 2021

$
19,823

Club Initiation Fees
Balance as of January 1, 2020

$
6,917
New club memberships

3,441
Revenue from amounts included in contract liability opening balance

(1,600)
Revenue from current period new memberships

(190)
Balance as of September 30, 2020

$
8,568

Remaining performance obligations represent contracted revenue that has not been recognized, which include club initiation fees. As of September 30, 2021 remaining performance obligations were $19.8 million, of which the Company expects to recognize as revenue $1.2 million in ~~2021, $8.5 million in~~ ~~2022 through 2023, $6.8 million in~~ ~~2024 through 2025~~ ~~and $3.3 million thereafter.~~

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Advance deposits consist of deposits received on hotel rooms and related hospitality activities. Advance deposits are recorded as other liabilities in the condensed consolidated balance sheets without regard to whether they are refundable and are recognized as income at the time the service is provided for the related deposit.

12. Deferred Revenue

Deferred revenue includes club initiation fees of $23.6 million and $22.9 million and other deferred revenue of $13.8 million and $13.4 million as of March 31, 2022 and December 31, 2021, respectively.


	March 31, 2022		March 31, 2021
Balance at beginning of period	$	22,850	$	10,716
New club memberships		2,270		2,848
Revenue from amounts included in contract liability opening balance		(1,491)		(852)
Revenue from current period new memberships		(56)		(71)
Balance at end of period	$	23,573	$	12,641

Remaining performance obligations represent contracted revenue that has not been recognized related to club initiation fees. As of March 31, 2022, remaining performance obligations were $23.6 million, of which the Company expects to recognize as revenue $4.1 million in 2022, $9.8 million in 2023 through 2024, $7.9 million in 2025 through 2026 and $1.8 million thereafter.

Other deferred revenue as of both March 31, 2022 and December 31, 2021, includes $10.9 million related to a 2006 agreement pursuant to which the Company agreed to sell land to the Florida Department of Transportation. Revenue is recognized when title to a specific parcel is legally transferred.

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~~12.~~13. Income Taxes

Income tax expense attributable to income from operations differed from the amount computed by applying the statutory federal income tax rate of 21% as of ~~September 30,~~March 31, 2022 and 2021 ~~and 2020,~~ to pre-tax income as a result of the following:


	Three Months Ended				Nine Months Ended				Three Months Ended
	September 30,				September 30,				March 31,
	2021		2020		2021		2020		2022		2021
Tax at the federal statutory rate	$	4,543	$	2,140	$	12,139	$	6,986	$	3,769	$	892
State income taxes (net of federal benefit)		340		359		1,614		1,172		787		150
Change in state tax rate		1,392		—		1,308		—
Tax credits		(63)		(85)		(156)		(336)		(55)		—
Other		217		27		275		30		35		10
Total income tax expense	$	6,429	$	2,441	$	15,180	$	7,852	$	4,536	$	1,052

As of ~~September 30, 2021 the Company had income tax receivable of $0.1 million, included within other assets on the condensed consolidated balance sheets. As of~~March 31, 2022 and December 31, ~~2020,~~2021, the Company had income tax payable of ~~$2.7~~$3.2 million and $0.7 million, respectively, included within other liabilities on the condensed consolidated balance sheets.

On September 14, 2021, the State of Florida announced the reduction of the 2021 corporate tax rate from ~~4.458%~~4.5% to ~~3.535%~~3.5% retroactive to the beginning of 2021. The corporate income tax rate ~~will revert~~has reverted to 5.5% for tax year 2022 and years forward. As

In general, a ~~result,~~valuation allowance is recorded if, based on all available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Realization of the Company’s deferred tax assets is dependent upon the Company ~~adjusted its~~generating sufficient taxable income in future years in the appropriate tax ~~provision for year-to-date earnings, as well as deferred taxes based on~~jurisdictions to obtain a benefit from the reversal of deductible temporary differences ~~that are expected to reverse in 2021. The impact~~and from loss carryforwards. As of ~~this tax rate change is a $1.4 million increase in income tax expense due to~~both March 31, 2022 and December 31, 2021, the ~~adjustment to deferred taxes, offset by a $0.4 million benefit on the year-to-date earnings, recorded in the three months ending September 30, 2021.~~Company’s valuation allowance was $0.3 million.

Significant judgment is required in evaluating the Company's uncertain tax positions and determining its provision for income taxes. The Company regularly assesses the likelihood of adverse outcomes resulting from potential examinations to determine the adequacy of its provision for income taxes and applies a “more-likely-than-not” in determining the financial statement recognition and measurement of a tax position taken or expected to be taken in athe tax ~~return.~~returns. The Company has not identified any material unrecognized tax benefits as of either ~~September 30, 2021~~March 31, 2022 or December 31, ~~2020.~~2021.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted in response to the COVID-19 pandemic. The CARES Act, among other things, permits net operating loss (“NOL”) carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. The CARES Act also contains modifications on the limitation of business interest for tax years 2019 and 2020. The modifications to Section 163(j) increase the allowable business interest deduction from 30% of adjusted taxable income to 50% of adjusted taxable income. Based upon current facts and circumstances, the Company does not expect that these provisions would result in a material cash benefit or impact to the effective tax rate.

On December 27, 2020, the Taxpayer Certainty and Disaster Tax Relief Act of 2020, a part of the Consolidated Appropriations Act, 2021, was enacted also in response to the COVID-19 pandemic. This legislation provided extensions on several federal tax credits and the expansion of the Employee Retention Credit, in addition to many other provisions. Based upon current facts and circumstances, the Company does not expect that these provisions would result in a material cash benefit or impact to the effective tax rate.

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On March 11, 2021, the American Rescue Plan Act of 2021 was enacted also in response to the COVID-19 pandemic. This legislation contains various provisions that benefit both individuals and their employers, but also expands the definition of “covered employee” as defined by Section 162(m)(1) of the Internal Revenue Code. Based upon current facts and circumstances, the Company does not expect that these provisions would result in a material cash benefit or impact to the effective tax rate.

~~13.~~14. Accumulated Other Comprehensive ~~Loss~~Income (Loss)

Following is a summary of the changes in the balances of accumulated other comprehensive (loss) income, ~~(loss),~~ which is presented net of tax:


	Unrealized Gain (Loss)		Unrealized				Unrealized Loss		Unrealized
	on Available-for-		(Loss) Gain				on Available-for-		(Loss) Gain
	Sale Securities		Cash Flow Hedge		Total		Sale Securities		Cash Flow Hedges		Total
Accumulated other comprehensive income (loss) at December 31, 2020	$	16	$	(1,488)	$	(1,472)
Accumulated other comprehensive loss as of December 31, 2021							$	(7)	$	(382)	$	(389)
Other comprehensive (loss) income before reclassifications		(1)		405		404		(241)		2,129		1,888
Amounts reclassified from accumulated other comprehensive (loss) income		(11)		199		188
Amounts reclassified from accumulated other comprehensive income								—		113		113
Other comprehensive (loss) income		(12)		604		592		(241)		2,242		2,001
Accumulated other comprehensive income (loss) at September 30, 2021	$	4	$	(884)	$	(880)
Less: other comprehensive income attributable to non-controlling interest								—		(692)		(692)
Accumulated other comprehensive (loss) income as of March 31, 2022							$	(248)	$	1,168	$	920

~~Following is a summary of the tax effects allocated to other comprehensive income (loss):~~

Three Months Ended September 30, 2021


Before-

Tax (Expense) or

Net-of-

Tax Amount

Benefit

Tax Amount
Unrealized gain on available-for-sale investments

$
3

$
(1)

$
2
Interest rate swap

301

(76)

225
Interest rate swap - unconsolidated affiliate

(1)

—

(1)
Reclassification adjustment for net loss included in earnings

154

(39)

115
Net unrealized gain

457

(116)

341
Other comprehensive income

$
457

$
(116)

$
341

Three Months Ended September 30, 2020


Before-

Tax (Expense) or

Net-of-

Tax Amount

Benefit

Tax Amount
Unrealized gain on available-for-sale investments

$
21

$
(5)

$
16
Unrealized gain on restricted investments

2

(1)

1
Interest rate swap

1

—

1
Interest rate swap - unconsolidated affiliate

(2)

1

(1)
Net unrealized gain

22

(5)

17
Other comprehensive income

$
22

$
(5)

$
17

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Following is a summary of the tax effects allocated to other comprehensive income:


	Nine Months Ended September 30, 2021						Three Months Ended March 31, 2022
	Before-				Net-of-		Before-		Tax Benefit		Net-of-
	Tax Amount		Tax Expense		Tax Amount		Tax Amount		(Expense)		Tax Amount
Unrealized loss on available-for-sale investments	$	(1)	$	—	$	(1)	$	(322)	$	81	$	(241)
Interest rate swap		410		(104)		306
Interest rate swap - unconsolidated affiliate		133		(34)		99
Interest rate swaps								2,308		(413)		1,895
Interest rate swap - unconsolidated joint venture								313		(79)		234
Reclassification adjustment for net loss included in earnings		251		(63)		188		147		(34)		113
Net unrealized gain		793		(201)		592		2,446		(445)		2,001
Other comprehensive income	$	793	$	(201)	$	592	$	2,446	$	(445)	$	2,001

Nine Months Ended September 30, 2020


Before-

Tax (Expense)

Net-of-

Tax Amount

Benefit

Tax Amount
Unrealized gain on available-for-sale investments

$
127

$
(32)

$
95
Unrealized gain on restricted investments

7

(2)

5
Interest rate swap

(865)

219

(646)
Interest rate swap - unconsolidated affiliate

(843)

214

(629)
Reclassification adjustment for net gain included in earnings

(4)

1

(3)
Net unrealized loss

(1,578)

400

(1,178)
Other comprehensive loss

$
(1,578)

$
400

$
(1,178)


	Three Months Ended March 31, 2021
	Before-		Tax Benefit		Net-of-
	Tax Amount		(Expense)		Tax Amount
Unrealized loss on available-for-sale investments	$	(2)	$	1	$	(1)
Interest rate swaps		157		(40)		117
Interest rate swap - unconsolidated joint venture		211		(54)		157
Reclassification adjustment for net gain included in earnings		(15)		4		(11)
Net unrealized gain		351		(89)		262
Other comprehensive income	$	351	$	(89)	$	262

~~14.~~15. Stockholders’ Equity

Dividends

During the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, the Company paid cash dividends of ~~$0.08~~$0.10 and ~~$0.24,~~$0.08, respectively, per share on the Company’s common stock for a total of $5.9 million and $4.7 million, ~~and $14.1 million,~~ respectively. ~~The Company did 0t pay cash dividends during the three and nine months ended September 30, 2020.~~

Stock Repurchase Program

The Company’s Board ~~has~~ approved a stock repurchase program (the “Stock Repurchase Program”) pursuant to which the Company is authorized to repurchase shares of its common stock. The ~~Stock Repurchase Program~~program has no expiration date.

During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, the Company did 0t repurchase shares of its common stock outstanding. During the nine months ended September 30, 2020, the Company repurchased 532,034 shares of its common stock at an average purchase price of $16.54, per share, for an aggregate purchase price of $8.8 million, pursuant to its Stock Repurchase Program. As of ~~September 30, 2021,~~March 31, 2022, the Company had a total authority of ~~$77.4~~$100.0 million available for purchase of shares of its common ~~stock pursuant to its Stock Repurchase Program.~~stock. The Company may repurchase its common stock in open market purchases from time to time, in privately negotiated transactions or otherwise, pursuant to Rule 10b-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing and amount of any additional shares to be repurchased will depend upon a variety of factors. Repurchases may be commenced or suspended at any time or from time to time without prior notice. The Stock Repurchase Program will continue until otherwise modified or terminated by the Company’s Board at any time in its sole discretion.

Issuance of Common Stock for ~~Director’s Fees~~Employee Compensation

On February 22, 2022, the Company granted 25,594 restricted stock awards to certain employees pursuant to the 2015 Performance and Equity Incentive Plan (the “2015 Plan”). The restricted shares will vest in equal annual installments on the first, second and third annual anniversary of the grant date, subject to the recipient’s continued employment through and on the applicable vesting date. The weighted average grant date fair value of restricted shares during the three months ended March 31, 2022 was $46.73. During the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~there were 0 restricted shares vested or forfeited.

Stock based compensation cost is measured at the ~~Company did 0t issue any common stock for director’s fees. On May 20, 2019,~~grant date based on the ~~Company’s Board approved granting to each non-employee director an equity grant with an aggregate~~ fair ~~market~~ value of ~~$50,000 or, at~~ the ~~director’s election, its cash equivalent. On July 1, 2019, 5,708 shares of restricted stock were granted to 2 of~~award and is typically recognized as expense on a straight-line basis over the ~~Company’s directors pursuant to~~requisite service period, which is the ~~Board’s May 20,~~vesting period. Forfeitures

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2019 approval and the Company’s 2015 Performance and Equity Incentive Plan (the “2015 Plan”). This restricted stock vested on May 19, 2020, the date of the Company’s 2020 Annual Meeting of Shareholders. NaN non-employee directors elected to receive cash in lieu of the stock, which was paid in July 2019.

~~During the three and nine months ended September 30, 2021 and~~are accounted for as they occur. For the three months ended ~~September 30, 2020, the Company did 0t have expense related to restricted stock awards to the Company’s directors. During the nine months ended September 30, 2020,~~March 31, 2022, the Company recorded expense of less than $0.1 million related to restricted stock ~~awards~~awards. During the three months ended March 31, 2021, the Company did 0t have expense related to ~~the Company’s directors.~~restricted stock awards.

As of March 31, 2022, there was $1.2 million of unrecognized compensation cost, related to non-vested restricted shares which will be recognized over a weighted average period of 2.9 years.

~~15.~~16. Revenue Recognition

Revenue consists primarily of real estate sales, hospitality operations, leasing operations and timber sales. Taxes collected from customers and remitted to governmental authorities (e.g., sales tax) are excluded from revenue, costs and expenses. The following represents revenue disaggregated by segment, good or service and timing:


	Three Months Ended September 30, 2021										Three Months Ended March 31, 2022
	Residential		Hospitality		Commercial		Other		Total		Residential		Hospitality		Commercial		Other		Total
Revenue by Major Good/Service:
Real estate revenue	$	21,603	$	—	$	1,560	$	337	$	23,500	$	32,674	$	—	$	3,618	$	482	$	36,774
Hospitality revenue		355		21,937		—		—		22,292		94		16,227		—		—		16,321
Leasing revenue		155		20		6,966		5		7,146		129		11		8,642		40		8,822
Timber revenue		—		—		1,058		—		1,058		—		—		2,954		—		2,954
Total revenue	$	22,113	$	21,957	$	9,584	$	342	$	53,996	$	32,897	$	16,238	$	15,214	$	522	$	64,871

Timing of Revenue Recognition:
Recognized at a point in time	$	21,958	$	16,729	$	2,618	$	337	$	41,642	$	32,768	$	9,916	$	6,572	$	482	$	49,738
Recognized over time		—		5,208		—		—		5,208		—		6,311		—		—		6,311
Over lease term		155		20		6,966		5		7,146		129		11		8,642		40		8,822
Total revenue	$	22,113	$	21,957	$	9,584	$	342	$	53,996	$	32,897	$	16,238	$	15,214	$	522	$	64,871


	Three Months Ended September 30, 2020										Three Months Ended March 31, 2021
	Residential		Hospitality		Commercial		Other		Total		Residential		Hospitality		Commercial		Other		Total
Revenue by Major Good/Service:
Real estate revenue	$	16,104	$	—	$	2,157	$	215	$	18,476	$	20,539	$	—	$	35	$	479	$	21,053
Hospitality revenue		232		16,773		—		—		17,005		81		12,986		—		—		13,067
Leasing revenue		17		3		4,943		—		4,963		40		8		5,546		—		5,594
Timber revenue		—		—		1,597		—		1,597		—		—		1,591		—		1,591
Total revenue	$	16,353	$	16,776	$	8,697	$	215	$	42,041	$	20,660	$	12,994	$	7,172	$	479	$	41,305

Timing of Revenue Recognition:
Recognized at a point in time	$	16,336	$	13,705	$	3,754	$	215	$	34,010	$	20,620	$	9,141	$	1,626	$	479	$	31,866
Recognized over time		—		3,068		—		—		3,068		—		3,845		—		—		3,845
Over lease term		17		3		4,943		—		4,963		40		8		5,546		—		5,594
Total revenue	$	16,353	$	16,776	$	8,697	$	215	$	42,041	$	20,660	$	12,994	$	7,172	$	479	$	41,305

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Nine Months Ended September 30, 2021

Residential

Hospitality

Commercial

Other

Total
Revenue by Major Good/Service:

Real estate revenue

$
74,670

$
—

$
9,771

$
1,174

$
85,615
Hospitality revenue

612

57,374

—

—

57,986
Leasing revenue

252

39

18,797

24

19,112
Timber revenue

—

—

4,827

—

4,827
Total revenue

$
75,534

$
57,413

$
33,395

$
1,198

$
167,540

Timing of Revenue Recognition:

Recognized at a point in time

$
75,282

$
43,610

$
14,598

$
1,174

$
134,664
Recognized over time

—

13,764

—

—

13,764
Over lease term

252

39

18,797

24

19,112
Total revenue

$
75,534

$
57,413

$
33,395

$
1,198

$
167,540

Nine Months Ended September 30, 2020

Residential

Hospitality

Commercial

Other

Total
Revenue by Major Good/Service:

Real estate revenue

$
33,060

$
—

$
7,244

$
1,534

$
41,838
Hospitality revenue

364

34,816

—

—

35,180
Leasing revenue

94

8

14,067

—

14,169
Timber revenue

—

—

5,508

—

5,508
Total revenue

$
33,518

$
34,824

$
26,819

$
1,534

$
96,695

Timing of Revenue Recognition:

Recognized at a point in time

$
33,424

$
26,471

$
12,752

$
1,534

$
74,181
Recognized over time

—

8,345

—

—

8,345
Over lease term

94

8

14,067

—

14,169
Total revenue

$
33,518

$
34,824

$
26,819

$
1,534

$
96,695

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~~16.~~17. Other ~~Income (Expense),~~Expense, Net

Other income (expense), net consists of the following:


	Three Months Ended				Nine Months Ended				Three Months Ended
	September 30,				September 30,				March 31,
	2021		2020		2021		2020		2022		2021
Investment income, net
Interest and dividend income	$	—	$	6	$	13	$	1,117
Accretion income		52		13		90		60
Net realized gain (loss) on the sale of investments		—		—		17		(48)
Interest, dividend and accretion income									$	100	$	24
Net realized gain on the sale of investments										—		17
Unrealized gain (loss) on investments, net		63		270		(1,947)		(4,633)		25		(1,049)
Interest income from investments in SPEs		2,003		2,045		6,075		6,136		2,003		2,043
Interest earned on notes receivable and other interest		213		71		565		219		172		160
Total investment income, net		2,331		2,405		4,813		2,851		2,300		1,195
Interest expense
Interest expense and amortization of discount and issuance costs for Senior Notes issued by SPE		(2,207)		(2,204)		(6,619)		(6,609)		(2,209)		(2,205)
Other interest expense		(1,907)		(1,175)		(5,020)		(3,504)		(1,944)		(1,466)
Total interest expense		(4,114)		(3,379)		(11,639)		(10,113)		(4,153)		(3,671)
Gain on contribution to equity method investment		—		—		3,290		19,615
Gain on contributions to unconsolidated joint ventures										482		120
Other income (expense), net
Accretion income from retained interest investments		392		349		1,129		1,034		417		361
Gain on insurance recovery		2,540		—		3,924		—		723		866
Loss from hurricane damage		(11)		(594)		(26)		(1,096)		(32)		(7)
Miscellaneous income, net		4,408		512		4,568		723
Other income, net		7,329		267		9,595		661
Total other income (expense), net	$	5,546	$	(707)	$	6,059	$	13,014
Miscellaneous (expense) income, net										(1,477)		74
Other (expense) income, net										(369)		1,294
Total other expense, net									$	(1,740)	$	(1,062)

Investment Income, Net

Interest, dividend and ~~dividend~~accretion income includes interest income accrued or received on the Company’s ~~investments. Accretion income includes the~~investments and amortization of the premium or accretion of discount related to the Company’s available-for-sale securities, which is amortized based on an effective interest rate method over the term of the available-for-sale securities. Net realized gain ~~(loss)~~ on the sale of investments include the gains or losses recognized on the sale of available-for-sale and equity securities prior to maturity. Unrealized gain (loss) on investments, net includes unrealized gains or losses on investments - equity securities.

Interest income from investments in SPEs primarily includes interest earned on the investments held by Panama City Timber Finance Company, LLC, which is used to pay the interest expense for Senior Notes held by Northwest Florida Timber Finance, LLC.

Interest Expense

Interest expense includes interest incurred related to the Company’s Senior Notes issued by Northwest Florida Timber Finance, LLC, project financing, CDD debt and finance leases. ~~Borrowing costs, including the~~Interest expense also includes amortization of debt discount and premium and debt issuance costs. Discount and issuance costs for the Senior Notes issued by Northwest Florida Timber Finance, LLC, are amortized based on the effective interest method at an effective rate of 4.9%.

During the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the Company capitalized ~~$0.2~~$0.3 million and $0.4 ~~million, respectively, in interest related to projects under development or construction. During the nine months ended September 30, 2021 and 2020, the Company capitalized $0.9 million and $0.6~~ million, respectively, in interest related to projects under development or construction. These amounts are included within investment in real estate, net on the Company’s condensed consolidated balance sheets.

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Gain on ~~Contribution~~Contributions to ~~Equity Method Investment~~Unconsolidated Joint Ventures

~~The Company did 0t have any gain~~Gain on ~~contribution~~contributions to ~~equity method investment during~~ unconsolidated joint ventures forthe three months ended ~~September 30, 2021 and 2020. Gain on contribution to equity method investment for the nine months ended September 30, 2021,~~March 31, 2022, includes a gain of ~~$0.2~~$0.4 million on land contributed to the Company’s unconsolidated Electric Cart Watersound JV. Each of the three months ended March 31, 2022 and 2021, also includes a gain of $0.1 million on additional infrastructure improvements contributed to the Company’s unconsolidated Latitude Margaritaville Watersound JV. The nine months ended September 30, 2021, also includes a gain of $3.1 million on land contributed to the Company’s unconsolidated Watersound Fountains Independent Living JV. Gain on contribution to equity method investment ~~for the nine months ended September 30, 2020, includes a gain of $15.3 million on land contributed to the Company’s unconsolidated Latitude Margaritaville Watersound JV.~~JV ~~The nine months ended September 30, 2020, also includes a gain of $4.3 million on land and mitigation credits contributed to the Company’s unconsolidated Sea Sound Apartments JV.~~. See Note 4. Joint Ventures for additional information.

Other (Expense) Income, Net

Other (expense) income, net primarily includes income from the Company’s retained interest investments, gain on insurance recovery, loss from hurricane damage and other income and expense items.

The Company records the accretion of investment income from its retained interest investment over the life of the retained interest using the effective yield method with rates ranging from 3.7% to ~~11.5%~~12.2%.

During the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, the Company had a gain on insurance recovery of ~~$2.5~~$0.7 million and ~~$3.9~~$0.9 million, respectively, and incurred loss from hurricane damage of less than $0.1 million, during each period, related to Hurricane Michael. During the three and nine months ended September 30, 2020, the Company did 0t have any gain on insurance recovery, but incurred $0.6 million and $1.1 million, respectively, of loss from hurricane damage related to Hurricane Michael. See Note 7. Hurricane Michael for additional information.

Miscellaneous ~~income,~~expense, net during the three ~~and nine~~ months ended ~~September 30, 2021,~~March 31, 2022, includes ~~$3.6~~$1.1 million ~~the Company received from the Florida Division~~ of ~~Emergency Management’s Florida Timber Recovery Block Grant Program (“TRBG”)~~design costs no longer pursued and $0.6 million for ~~recovery of lost income related to timber crop that was destroyed as~~ a ~~result of Hurricane Michael. The Company has met all requirements related to the TRBG program as of September 30, 2021. See Note 7.~~ ~~Hurricane Michael~~ ~~for additional information.~~homeowner’s association special assessment.

~~17.~~18. Segment Information

The Company conducts primarily all of its business in the following 3 reportable segments: (1) residential, (2) hospitality and (3) commercial.

The Company’s reportable segments are strategic business units that offer different products and services. They are each managed separately and decisions about allocations of resources are determined by management based on these strategic business units.

The Company uses income before equity in loss from unconsolidated ~~affiliates,~~joint ventures, income taxes and non-controlling interest and other qualitative measures for purposes of making decisions about allocating resources to each segment and assessing each segment’s performance, which the Company believes represents current performance measures.

The accounting policies of the segments are set forth in Note 2 to the Company’s consolidated financial statements contained in Item 15 of the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021. Total revenue represents sales to unaffiliated customers, as reported in the Company’s condensed consolidated statements of income. All significant intercompany transactions have been eliminated in consolidation. The caption entitled “Other” consists of mitigation credit, title ~~fee~~ and insurance business revenue and cost of ~~revenue and~~revenue; corporate operating ~~expenses,~~expenses; corporate depreciation and amortization and corporate other income and expense items.

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Information by business segment is as follows:


	Three Months Ended				Nine Months Ended				Three Months Ended
	September 30,				September 30,				March 31,
	2021		2020		2021		2020		2022		2021
Operating revenue:
Residential	$	22,113	$	16,353	$	75,534	$	33,518	$	32,897	$	20,660
Hospitality		21,957		16,776		57,413		34,824		16,238		12,994
Commercial		9,584		8,697		33,395		26,819		15,214		7,172
Other		342		215		1,198		1,534		522		479
Consolidated operating revenue	$	53,996	$	42,041	$	167,540	$	96,695	$	64,871	$	41,305

Income (loss) before equity in loss from unconsolidated affiliates and income taxes:
Income (loss) before equity in loss from unconsolidated joint ventures and income taxes:
Residential^(a)	$	12,918	$	6,206	$	40,982	$	28,212	$	17,084	$	8,595
Hospitality		4,195		4,940		9,901		5,094		(963)		284
Commercial ^{(b) (c)}		4,522		2,006		14,899		13,406
Commercial^(a)										4,818		17
Other(b)		72		(2,834)		(7,273)		(12,893)		(2,455)		(4,419)
Consolidated income before equity in loss from unconsolidated affiliates and income taxes	$	21,707	$	10,318	$	58,509	$	33,819
Consolidated income before equity in loss from unconsolidated joint ventures and income taxes									$	18,484	$	4,477

(a)

The ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2022, includes a gain of ~~$15.3~~$0.4 million on land contributed to the ~~Latitude~~Electric Cart Watersound ~~Margaritaville~~ JV. See Note 4. Joint Ventures and Note ~~16.~~17. Other ~~Income (Expense), Net~~ ~~for additional information.~~

~~(b)~~

~~The nine months ended September 30, 2021, includes a gain of $3.1 million on land contributed to the Watersound Fountains Independent Living JV.~~ ~~See Note 4.~~ ~~Joint Ventures~~ ~~and Note 16.~~ ~~Other Income (Expense), Net~~ ~~for additional information.~~

~~(c)~~

~~The nine months ended September 30, 2020, includes a gain of $3.9 million on land contributed to the Sea Sound Apartments JV. See Note 4.~~ ~~Joint Ventures~~ ~~and Note 16.~~ ~~Other Income (Expense),~~Expense, Net for additional information.

(b)	Includes gain on insurance recovery of $0.7 million and $0.9 million during the three months ended March 31, 2022 and 2021, respectively, related to Hurricane Michael. See Note 7. Hurricane Michael for additional information.


	September 30,		December 31,		March 31,		December 31,
	2021		2020		2022		2021
Total assets:
Residential	$	191,310	$	172,610	$	196,497	$	195,142
Hospitality		219,625		146,724		287,270		256,751
Commercial		367,122		332,649		396,870		375,266
Other		358,493		385,341		375,708		380,992
Total assets	$	1,136,550	$	1,037,324	$	1,256,345	$	1,208,151

~~18.~~19. Commitments and Contingencies

The Company establishes an accrued liability when it is both probable that a material loss has been incurred and the amount of the loss can be reasonably estimated. The Company will evaluate the range of reasonably estimated losses and record an accrued liability based on what it believes to be the minimum amount in the range, unless it believes an amount within the range is a better estimate than any other amount. In such cases, there may be an exposure to loss in excess of the amounts accrued. The Company evaluates quarterly whether further developments could affect the amount of the accrued liability previously established or would make a loss contingency both probable and reasonably estimable.

The Company also provides disclosure when it believes it is reasonably possible that a material loss will be incurred or when it believes it is reasonably possible that the amount of a loss will exceed the recorded liability. The Company reviews loss contingencies at least quarterly to determine whether the likelihood of loss has changed and to assess whether a reasonable estimate of the loss or range of loss can be made. This estimated range of possible losses is based upon currently available information and is subject to significant judgment and a variety of assumptions, as well as known and unknown uncertainties. The matters underlying the estimated range will change from time to time, and actual results may vary significantly from the current estimate.

~~Table of Contents~~

The Company is subject to a variety of litigation, claims, other disputes and governmental proceedings that arise from time to time in the ordinary course of its business, including litigation related to its prior homebuilding and

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development activities. The Company cannot make assurances that it will be successful in defending these matters. Based on current knowledge, the Company does not believe that loss contingencies arising from pending litigation, claims, other disputes and governmental proceedings, including those described herein, will have a material adverse effect on the consolidated financial position or liquidity of the Company. However, in light of the inherent uncertainties involved in these matters, an adverse outcome in one or more of these matters could be material to the Company’s results of operations or cash flows for any particular reporting period.

The Company is subject to costs arising out of environmental laws and regulations, which include obligations to remove or limit the effects on the environment of the disposal or release of certain wastes or substances at various sites, including sites which have been previously sold. It is the Company’s policy to accrue and charge against earnings environmental cleanup costs when it is probable that a liability has been incurred and a range of loss can be reasonably estimated. As assessments and cleanups proceed, these accruals are reviewed and adjusted, if necessary, as additional information becomes available. The Company is in the process of assessing certain properties in regard to the effects, if any, on the environment from the disposal or release of wastes or substances. Management is unable to quantify future rehabilitation costs above present accruals at this time or provide a reasonably estimated range of loss.

Other litigation, claims and disputes, including environmental matters, are pending against the Company. Accrued aggregate liabilities related to the matters described above and other litigation matters were $0.4 million ~~and $0.7 million~~ as of ~~September 30, 2021~~both March 31, 2022 and December 31, ~~2020, respectively.~~2021. Significant judgment is required in both the determination of probability and whether the amount of an exposure is reasonably estimable. Due to uncertainties related to these matters, accruals are based only on the information available at the time. As additional information becomes available, management reassesses potential liabilities related to pending claims and litigation and may revise its previous estimates, which could materially affect the Company’s results of operations for any particular reporting period.

The Company has retained certain self-insurance risks with respect to losses for third party liability and property damage, including its timber assets.

In June 2020, the Company, as lender, entered into a $10.0 million secured revolving promissory note with the unconsolidated Latitude Margaritaville Watersound JV, as borrower. As of ~~September 30, 2021 and~~March 31, 2022, there was 0 balance outstanding on theLatitude JV Note. As of December 31, ~~2020, $8.6~~2021, $7.1 million ~~and $2.7 million, respectively,~~ was outstanding on the Latitude ~~Margaritaville Watersound~~ JV Note. The Latitude ~~Margaritaville Watersound~~ JV Note was provided by the Company to finance the development of the pod-level, non-spine ~~infrastructure, which~~infrastructure. Future advances, if any, will be repaid by the JV as each home is sold by the JV, with the aggregate unpaid principal and all accrued and unpaid interest due at maturity in June 2025. The Latitude ~~Margaritaville Watersound~~ JV Note is secured by a mortgage and security interest in and on the real property and improvements located on the real property of the JV. See Note 4. Joint Ventures and Note 9. Other Assets for additional information.

As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, the Company was required to provide surety bonds that guarantee completion and maintenance of certain infrastructure in certain development projects and mitigation banks, as well as other financial guarantees of ~~$24.7~~$37.3 million and ~~$24.2~~$36.9 million, respectively, as well as standby letters of credit in the amount of ~~$3.3~~$16.8 million and ~~$6.6~~$12.9 million, respectively, which may potentially result in liability to the Company if certain obligations of the Company are not met.

As of ~~September 30, 2021,~~March 31, 2022, the Company had a total of ~~$260.1~~$220.1 million in construction and development related contractual obligations, of which a significant portion will be funded through committed or new financing arrangements.

In January 2019, the Company’s unconsolidated Pier Park TPS JV, entered into a $14.4 million loan (the “Pier Park TPS JV Loan”). The Pier Park TPS JV Loan bears interest at LIBOR plus 2.5% and provides for monthly principal and interest payments with a final balloon payment at maturity in January 2026. The Pier Park TPS JV Loan is secured by the real and personal property and an assignment of rents and the security interest in the rents. In connection with the Pier Park TPS JV Loan, the Company, a wholly-owned subsidiary of the Company and the Company’s JV partner entered into a joint and several payment and performance guarantee in favor of the lender. The Company’s liability as guarantor under the Pier Park TPS JV Loan ~~is 50% and will be~~has been reduced to 25% of the outstanding principal ~~balance upon reaching and~~amount, which requires maintaining a certain debt service coverage. The guarantee contains customary provisions providing for full

~~Table of Contents~~

recourse upon the occurrence of certain events. The Pier Park TPS JV entered into an interest rate swap to hedge cash

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flows tied to changes in the underlying floating interest rate tied to LIBOR. The interest rate swap was effective January 14, 2021 and matures on January 14, 2026 and fixed the variable rate on the related debt, initially at $14.4 million to a rate of 5.2%. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, $14.2~~2021, $14.0 million and ~~$14.4~~$14.1 million, respectively, was outstanding on the Pier Park TPS JV Loan. See Note 6. Financial Instruments and Fair Value Measurements for additional information.

In November 2019, the Company’s unconsolidated Busy Bee JV, entered into a $5.4 million construction loan (the “Busy Bee JV Construction Loan”) and a $1.2 million equipment loan (the “Busy Bee JV Equipment Loan”). The Busy Bee JV Construction Loan and the Busy Bee JV Equipment Loan bear interest at LIBOR plus 1.5%. The Busy Bee JV Construction Loan provides for monthly principal and interest payments with a final balloon payment at maturity in November 2035. The Busy Bee JV Equipment Loan provides for monthly principal and interest payments through maturity in November 2027. The loans are secured by the real and personal property, assignment of rents and leases and a security interest in the construction contract and management agreement. In connection with the Busy Bee JV Construction Loan and the Busy Bee JV Equipment Loan, the Company, a wholly-owned subsidiary of the Company and the Company’s JV partner entered into a joint and several payment and performance guarantee in favor of the lender through substantial completion, which occurred in June 2020. The Company’s liability as guarantor under the loans upon substantial completion was reduced to 50% for a twelve month period. Subsequent to that time, the Company’s guarantee will be released upon request. Upon release of the Company’s guarantee, the JV partner will be the sole guarantor and will receive a fee related to the guarantee from the Company based on the Company’s ownership percentage. The Busy Bee JV entered into an interest rate swap to hedge cash flows tied to changes in the underlying floating interest rate tied to LIBOR for the Busy Bee JV Construction Loan and the Busy Bee JV Equipment Loan. The Busy Bee JV Construction Loan interest rate swap was effective November 12, 2020 and matures on November 12, 2035 and fixed the variable rate debt, initially at $5.4 million amortizing to $2.8 million at swap maturity, to a rate of 2.7%. The Busy Bee JV Equipment Loan interest rate swap was effective November 12, 2020 and matures on November 12, 2027 and fixed the variable rate debt, initially at $1.2 million to maturity, to a rate of 2.1%. As of September 30, 2021 and December 31, 2020, $5.3 million and $5.4 million, was outstanding on the Busy Bee JV Construction Loan. As of September 30, 2021 and December 31, 2020, $1.1 million and $1.2 million, respectively, was outstanding on the Busy Bee JV Equipment Loan.

In November 2020, the Company’s unconsolidated Latitude Margaritaville Watersound JV, entered into a $25.0 million ~~construction~~ loan (the “Latitude Margaritaville Watersound JV Loan”). The Latitude Margaritaville Watersound JV Loan bears interest at LIBOR plus 2.5%, with a floor of 3.3%. The Latitude Margaritaville Watersound JV Loan provides for monthly interest payments with a final balloon payment at maturity in November 2023. The Latitude Margaritaville Watersound JV Loan includes annual maturity extension rights for a total of three additional years, subject to bank approval. The Latitude Margaritaville Watersound JV Loan is secured by the real and personal property, assignment of rents, leases and deposits and security interest in the land development, construction contracts, plans and specifications, permits, agreements, approvals, fees and deposits. In connection with the Latitude Margaritaville Watersound JV Loan, the Company and the Company’s JV partner entered into an unconditional guaranty of completion of certain homes in favor of the lender. As of ~~September 30, 2021 and~~March 31, 2022, $15.7 million was outstanding on the Latitude Margaritaville Watersound JV Loan. As of December 31, ~~2020, $5.5 million and $0.6 million, respectively,~~2021, there was 0 principal balance outstanding on the Latitude Margaritaville Watersound JV Loan.

In April 2021, the Company’s unconsolidated Watersound Fountains Independent Living JV, entered into a $41.9 million ~~construction~~ loan (the “Watersound Fountains JV Loan”). The Watersound Fountains JV Loan bears interest at LIBOR plus 2.0%, with a floor of 2.5%. The Watersound Fountains JV Loan provides for interest only payments for the first forty-eight months and principal and interest payments thereafter with a final balloon payment at maturity in April 2026. The Watersound Fountains JV Loan includes an option for an extension of the maturity date by twelve months, subject to certain conditions, ~~that~~which would provide for continued monthly principal and interest payments with a final balloon payment at the extended maturity date. The Watersound Fountains JV Loan is secured by the real property, assignment of rents, leases, deposits, licenses, permits, contracts and construction and development documents and the security interest in the personal property, rents and management agreement. In connection with the Watersound Fountains JV Loan, the Company executed a guarantee in favor of the lender to guarantee the completion of the project and payment and performance of the borrower under the Watersound Fountains JV Loan. The Company’s liability as guarantor under the Watersound Fountains JV Loan will be reduced to 50% of the outstanding principal amount upon issuance of the certificate of occupancy and reduced to 25% and a further 0% of the outstanding principal balance upon reaching and maintaining certain debt service coverage. The guarantee contains customary provisions providing for full recourse upon

~~Table of Contents~~

the occurrence of certain events. The Company is the sole guarantor and ~~will receive~~receives a quarterly fee related to the guarantee from its JV partners based on the JV partners’ ownership percentage. As of ~~September 30,~~March 31, 2022 and December 31, 2021, ~~there~~$7.3 million and $0.1 million, respectively, was ~~0 principal balance~~ outstanding on the Watersound Fountains JV Loan.

The Company has assessed the need to record a liability for the guarantees related to the Company’s unconsolidated JVs and did not record an obligation as of both ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020.~~2021. As of both ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, allowance for credit losses related to the contingent aspect of these guarantees, based on historical experience and economic trends, was $0.1 million and is included within other liabilities on the condensed consolidated balance sheets.

~~19.~~20. Subsequent Event

On ~~October~~April 27, ~~2021,~~2022, the Company’s Board of Directors declared a cash dividend of ~~$0.08~~$0.10 per share on the Company’s common stock, payable on ~~December 10, 2021~~June 9, 2022 to shareholders of record at the close of business on ~~November 12, 2021.~~May 11, 2022.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and related notes in Item 1 and with the audited consolidated financial statements and the related notes included in our annual report on Form 10-K. The statements ~~in this discussion~~ regarding industry outlook, our expectations regarding our future performance, liquidity and capital resources and other non-historical statements in this discussion are forward-looking statements. These forward-looking statements are subject to risks and uncertainties, including the risks and uncertainties described in “Forward-Looking Statements” below and “Risk Factors” on page 46 of our annual report on Form 10-K. Our actual results may differ materially from those contained in or implied by any forward-looking statements. We assume no obligation to revise or publicly release any revision to any forward-looking statements contained in this quarterly report on Form 10-Q, unless required by law.

Business Overview

St. Joe is a real estate development, asset management and operating company with all of its real estate assets and operations in Northwest Florida. We intend to use existing assets for residential, hospitality and commercial ventures. We have significant residential and commercial land-use entitlements. We actively seek higher and better uses for our real estate assets through a range of development activities. We may partner with or explore the sale of discrete assets when we and/or others can better deploy resources. We seek to enhance the value of our owned real estate assets by developing residential, commercial and hospitality projects to meet market demand. Approximately 86% of our real estate is located in Florida’s Bay, Gulf, and Walton counties. Approximately 90% of our real estate land holdings are located within fifteen miles of the Gulf of Mexico.

We believe our present capital structure, liquidity and land provide us with years of opportunities to increase recurring revenue and long-term value for our shareholders. We intend to focus on our core business activity of real estate development, asset management and operations. We continue to develop a broad range of asset types that we believe will provide acceptable rates of return, grow recurring revenues and support future business. Capital commitments will be funded with cash proceeds from completed projects, existing cash, owned-land, partner capital and financing arrangements. We do not anticipate immediate benefits from investments. Timing of projects may be subject to delays caused by factors beyond our control.

Our real estate investment strategy focuses on projects that meet long-term risk-adjusted return criteria. Our practice is to only incur such expenditures when our analysis indicates that a project will generate a return equal to or greater than the ~~expected~~threshold return over its life.

49First quarter 2022 highlights include:

●

Revenue for the three months ended March 31, 2022 increased by 57.1% to $64.9 million, compared to $41.3 million during the same period in 2021.

●

Net income attributable to the Company for the three months ended March 31, 2022 increased by 319.6% to $13.4 million, compared to $3.2 million during the same period in 2021.

●

Net cash provided by operating activities for the three months ended March 31, 2022 increased by 101.6% to $19.8 million, compared to $9.8 million during the same period in 2021.

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~~COVID-19 Pandemic Update~~Market Conditions

Our business and results of operations improved in the first nine months of 2021 relative to the same period of 2020 as a result of several positive trends, including the global response to the COVID-19 outbreak, which was declared a pandemic in March 2020. While the economic recovery following containment and mitigation measures of COVID-19 is still ongoing and other macro-economic factors such as geopolitical conflicts, inflation, supply chain disruptions and rising interest rates have impacted the global economy, demand across our segments remains strong. We believe this is primarily the result of the continued growth in Northwest Florida, which we attribute to the region’s high quality of life, natural beauty and ~~world class~~outstanding amenities, as well as the evolving flexibility in the workplace.

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Despite our positive financial results during the COVID-19 pandemic, the magnitude and duration of the COVID-19 pandemic remains unknown, and we could experience material declines within each of our reportable segments in ~~2021~~2022 and beyond compared to the historical norms. We have taken measures and may be required to take additional measures in the future, in response to the ~~pandemic. For example, beginning in mid-March 2020, in response to federal, state and local orders and guidelines, we took a number~~pandemic, including temporary closures of ~~protective measures, including temporarily closing the WaterColor Inn, WaterSound Inn and The Pearl Hotel for overnight guests, closing~~our hotels, retail outlets, ~~and~~ beach clubs ~~closing or limiting restaurant activities at our~~and food and beverage operations, ~~to pick up only (and in certain locations, local delivery),~~ implementing cost reduction measures and “work from home” policies. ~~Our hospitality assets gradually reopened in May 2020, but could be ordered to close again.~~ We will continue to monitor the potential impacts and evaluate each new project day-by-day and phase-by-phase and take prudent measures and respond as needed based on market conditions.

For further discussion of the potential impacts on our business from the COVID-19 pandemic, see Part I, Item 1A. Risk Factors within our ~~2020~~2021 Annual Report.

Reportable Segments

We conduct primarily all of our business in the following three reportable segments: (1) residential, (2) hospitality and (3) commercial.

The following table sets forth the relative contribution of these reportable segments to our consolidated operating revenue:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2021		2020		2021		2020		2022		2021
Segment Operating Revenue
Residential	41.0	%	38.9	%	45.1	%	34.7	%	50.7	%	50.0	%
Hospitality	40.7	%	39.9	%	34.3	%	36.0	%	25.0	%	31.5	%
Commercial	17.7	%	20.7	%	19.9	%	27.7	%	23.5	%	17.4	%
Other	0.6	%	0.5	%	0.7	%	1.6	%	0.8	%	1.1	%
Consolidated operating revenue	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%

For more information regarding our reportable segments see Note ~~17.~~18. Segment Information ~~of our condensed consolidated financial statements included in this quarterly report.~~.

Residential Segment

Our residential ~~real estate~~ segment typically plans and develops residential communities of various sizes across a wide range of price points and sells homesites to homebuilders or retail consumers. Our residential ~~real estate~~ segment also evaluates ~~opportunities to develop and build attached and detached homes for rent or sale to retail consumers, as well as~~ opportunities to enter into JV agreements for specific communities such as Latitude Margaritaville Watersound.

The Watersound Origins, Watersound Camp Creek, Breakfast Point East, Titus Park, Ward Creek, Watersound Origins West, College Station, Park Place, Mexico Beach, WindMark Beach and SouthWood communities are large scale, multi-phase communities with current development activity, sales activity or future phases. Homesites in these

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communities are developed based on market demand and sold primarily to homebuilders and ~~retail customers~~ on a limited ~~basis.~~basis to retail customers.

The East Lake Creek, East Lake Powell, Lake Powell and West Laird communities have received local county government approvals for the entitlements. These communities have phases of homesites in preliminary planning. Homesites in these communities will be developed based on market demand and sold primarily to homebuilders and on a limited basis to retail customers.

The SummerCamp Beach and RiverCamps communities have homesites available for sale and lands for future development. The ~~WaterColor and~~last homesites in the Wild Heron and WaterColor communities have been sold or are ~~substantially developed,~~under contract, with ~~remaining homesites available~~no additional lands for ~~sale.~~homesite development.

The Latitude Margaritaville Watersound community is a planned 55+ active adult residential community ~~under development and construction~~ in Bay County, Florida. The community is located near the Intracoastal Waterway with convenient access to the Northwest Florida Beaches International Airport. The community is being developed through an unconsolidated JV with our partner Minto Communities USA, a homebuilder and community developer, and is estimated to include approximately 3,500 residential homes, which will be developed in smaller increments of discrete neighborhoods. As of ~~September 30, 2021,~~

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March 31, 2022, the unconsolidated Latitude Margaritaville Watersound JV had ~~299~~527 homes under contract, which are expected to result in a sales value of approximately ~~$121.5~~$243.8 million at closing of the homes. See Note 4. Joint Ventures for additional information.

The residential homesite pipeline by community/project is as follows:


		Residential Homesite Pipeline^(a)					Residential Homesite Pipeline^(a)
				Additional					Additional
		Platted or	Engineering or	Entitlements with			Platted or	Engineering or	Entitlements with
Community/Project	Location	Under Development	Permitting	Concept Plan	Total	Location	Under Development	Permitting	Concept Plan	Total
Breakfast Point East^(b)	Bay County, FL	235	173	318	726	Bay County, FL	193	349	104	646
College Station	Bay County, FL	71	83	235	389	Bay County, FL	36	58	243	337
East Lake Creek^(b)	Bay County, FL	—	—	200	200	Bay County, FL	—	—	200	200
East Lake Powell^(c)	Bay County, FL	—	—	360	360	Bay County, FL	—	—	360	360
Lake Powell^(d)						Bay County, FL	—	—	1,352	1,352
Latitude Margaritaville Watersound ^{(d) (e)}	Bay County, FL	629	344	2,527	3,500	Bay County, FL	1,073	340	2,022	3,435
Mexico Beach^(b)	Bay County, FL	32	60	275	367	Bay County, FL	32	60	275	367
Mexico Beach Townhomes^(b)	Bay County, FL	42	36	82	160	Bay County, FL	42	36	82	160
Park Place	Bay County, FL	49	106	191	346	Bay County, FL	123	—	191	314
RiverCamps^(c)	Bay County, FL	26	—	149	175	Bay County, FL	2	—	149	151
SouthWood^(f)	Leon County, FL	39	172	994	1,205	Leon County, FL	29	172	994	1,195
SummerCamp Beach^(b)	Franklin County, FL	86	—	271	357	Franklin County, FL	62	—	273	335
Titus Park	Bay County, FL	315	144	650	1,109	Bay County, FL	278	144	560	982
Watersound Origins West^(d)	Walton County, FL	115	—	5,781	5,896	Walton County, FL	115	250	1,678	2,043
Watersound Camp Creek^(f)	Walton County, FL	202	—	—	202	Walton County, FL	114	—	—	114
Watersound Origins^(f)	Walton County, FL	247	475	—	722	Walton County, FL	618	—	—	618
Watersound Origins Townhomes^(f)	Walton County, FL	64	—	—	64
Ward Creek^(d)	Bay County, FL	355	238	1,007	1,600	Bay County, FL	355	594	651	1,600
WaterColor Park District	Walton County, FL	4	—	—	4	Walton County, FL	1	—	—	1
Wild Heron	Bay County, FL	2	—	—	2
West Laird^(d)						Bay County, FL	—	—	2,185	2,185
WindMark Beach^(f)	Gulf County, FL	312	—	966	1,278	Gulf County, FL	215	—	866	1,081
Total Homesites		2,825	1,831	14,006	18,662		3,288	2,003	12,185	17,476

(a)	The number of homesites are preliminary and are subject to change. Includes homesites platted or currently in concept planning, engineering, permitting or development. We have significant additional entitlements for future residential homesites on our land holdings.

(b)	Planned Unit Development (“PUD”).

(c)	Development Agreement (“DA”).

(d)	Detailed Specific Area Plan (“DSAP”).

(e)	The unconsolidated Latitude Margaritaville Watersound JV ~~plans to build~~builds and ~~sell~~sells homes in this community.

(f)	Development of Regional Impact (“DRI”).

In addition to the communities listed above, we have a number of residential projects in various stages of planning.

As of ~~September 30, 2021,~~March 31, 2022, we had ~~1,661~~18 different homebuilders within our residential communities. As of March 31, 2022, we had 2,294 residential homesites under contract, ~~with 16 different local, regional and national homebuilders,~~ which are expected to result in revenue of approximately ~~$160.7~~$175.6 million at closing of the homesites ~~which are expected~~ over the next several years. AsBy comparison, as of ~~September 30, 2020,~~March 31, 2021, we had ~~1,401~~1,268 residential homesites under contract, ~~which were~~with an expected ~~to result in~~ revenue of approximately ~~$119.3~~$114.0 million. The increase in homesites under contract is due to the development of additional homesites and increased homebuilder contracts for

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residential homesites. The number of homesites under contract are subject to change based on homesite closings and homebuilder interest in each community. As of ~~September 30, 2021,~~March 31, 2022, in addition to the ~~1,661~~2,294 homesites in other residential communities, our unconsolidated Latitude Margaritaville Watersound JV had ~~299~~527 homes under contract, which together with the ~~1,661~~2,294 homesites are expected to result in a sales value of approximately ~~$282.2~~$419.4 million at closing of the homesites and homes.

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Hospitality Segment

Our hospitality segment features a private membership club, ~~(“Watersound~~(the “Watersound Club”~~, formerly referred to as The Clubs by JOE)~~), hotel operations, food and beverage operations, golf courses, beach clubs, retail outlets, gulf-front vacation rentals, management services, marinas and other entertainment assets. The hospitality segment generates revenue and incurs costs from membership sales, membership reservations, golf courses, ~~the WaterColor Inn, Hilton Garden Inn Panama City Airport and WaterSound Inn,~~lodging, short-term vacation rentals, management of The Pearl Hotel, food and beverage operations, merchandise sales, marina operations, charter flights, other resort and entertainment activities and beach clubs, which includes operation of the WaterColor Beach Club. Hospitality revenue is generally recognized at the point in time services are provided and represent a single performance obligation with a fixed transaction price. Hospitality revenue recognized over time includes non-refundable club membership initiation fees, club membership dues, management fees and other membership fees. From time to time, we may explore the sale of certain hospitality properties, the development of new hospitality properties, as well as new entertainment and management opportunities. Some of our JV assets and other assets incur interest and financing expenses related to the loans as described in Note 10. Debt, Net.

Watersound Club provides club members and guests inof some of our hotels access to our member facilities, which include the Camp Creek golf course, Shark’s Tooth golf course, Watersound Beach Club and ~~our~~a Pilatus PC-12 NG aircraft (“N850J”). Watersound Club offers different types of club memberships, each with different access rights and associated fee structures. Watersound Club is focused on creating ~~a world class~~an outstanding membership experience combined with the luxurious aspects of a destination resort. Club operations include our golf courses, beach club and facilities that generate revenue from membership sales, membership reservations, daily play at the golf courses, merchandise sales, charter flights and food and beverage sales and incur expenses from the services provided, maintenance of the golf courses, aircraft, beach club and facilities and personnel costs. Watersound Origins includes ~~a six-hole~~an executive golf course, resort-style pool, fitness center, two tennis courts and a private ~~lake~~ dock located in the community. Access to amenities ~~are~~is reserved to Watersound Origins members consisting of the community residents. The golf course is available for public play.

Watersound Club has a private beach club located ~~in Watersound, Florida,~~on Scenic Highway 30A, which includes over one mile of Gulf of Mexico frontage, two resort-style pools, two restaurants, three bars, kid’s room and a recreation area. Shark’s Tooth includes an 18-hole golf course, a full club house, a pro shop, as well as two food and beverage operations. In addition to the golf course, Watersound Club’s tennis center is located in the Wild Heron community near the Shark’s Tooth golf course. Camp Creek is an 18-hole golf course located near the new Watersound ~~Origins~~Camp Creek residential community and near the ~~new Camp Creek~~Watersound Origins residential community. In the fourth quarter of 2019, we commenced construction on new club amenities adjacent to the Camp Creek golf course. Amenities are planned to include a health and wellness center, restaurants, a tennis and pickle ball center, a resort-style pool complex with separate adult pool, a golf teaching academy, pro shop and multi-sport fields. Once complete, these amenities will be available to Watersound Club members and guests atof some of our hotels.

We own and operate the award-winning WaterColor Inn (which includes the Fish Out of Water restaurant), the Hilton Garden Inn Panama City Airport, the Homewood Suites by Hilton Panama City Beach, the WaterSound Inn and two gulf-front vacation rental houses. We own and operate retail and commercial outlets near our hospitality facilities. We also operate the award-winning The Pearl Hotel and Havana Beach Bar & Grill restaurant and the WaterColor Beach Club, which includes food and beverage operations and other hospitality related activities, such as beach chair rentals. Revenue is generated from (i) ~~the WaterColor Inn, Hilton Garden Inn Panama City Airport, WaterSound Inn and~~lodging, (ii) operation of the WaterColor Beach Club, ~~(ii)~~(iii) management of The Pearl Hotel, ~~(iii)~~(iv) short-term vacation rentals, ~~(iv)~~(v) food and beverage operations and ~~(v)~~(vi) merchandise sales. ~~The WaterColor Inn, Hilton Garden Inn Panama City Airport, WaterSound Inn~~Lodging and operation of the WaterColor Beach Club generate revenue from service and/or daily rental fees and incur expenses from the cost of services and goods provided, maintenance of the facilities and personnel costs. Revenue generated from our management services include

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management ~~fees. Management services~~fees and expenses consist primarily of internal administrative costs. ~~Hotel operations~~Lodging and short-term vacation rentals generate revenue from rental fees and incur expenses from the holding cost of assets we own and standard lodging personnel, such as front desk, reservations and marketing personnel. Our food and beverage operations generate revenue from food and beverage sales and incur expenses from the cost of services and goods provided and standard personnel costs. Our retail outlets generate revenue from merchandise sales ~~which are recognized at the point of sale~~ and incur expenses from the cost of goods provided, personnel costs and facility costs.

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We are in the process of constructing seven additional suites at WaterColor Inn; an Embassy Suites by Hilton hotel, with our JV partner, in the Pier Park area of Panama City Beach, Florida; the waterfront Hotel Indigo and standalone restaurant in Panama City, Florida’s downtown waterfront district; a Home2 Suites by Hilton hotel in Santa Rosa Beach, Florida; The Lodge 30A, with our JV partner, a boutique hotel on Scenic Highway 30A in Seagrove Beach, Florida; and an upscale boutique inn located adjacent to the Camp Creek golf course near the highly desirable Scenic Highway 30A corridor; a HomeWood Suites by Hilton adjacent to the new Panama City Beach Sports Complex in Panama City Beach, Florida; the waterfront Hotel Indigo and standalone restaurant in Panama City, Florida’s downtown waterfront district; The Lodge 30A, with our JV partner, a boutique hotel on Scenic Highway 30A in Seagrove Beach, Florida; and seven additional suites at WaterColor Inn. We are also in the process of planning a Home2 Suites by Hilton Hotel in Santa Rosa Beach, Florida.corridor. Once complete, we intend to manage the day-to-day operations of ~~all planned~~these hotels and ~~restaurants.~~restaurant.

Our hotel portfolio by property is as follows:


		Rooms^(a)				Rooms^(a)
	Location	Completed	Planned	Total	Location	Completed	Planned	Total
Operational
WaterColor Inn^(b)	Walton County, FL	60	7	67	Walton County, FL	60	7	67
WaterSound Inn	Walton County, FL	11	—	11	Walton County, FL	11	—	11
Hilton Garden Inn Panama City Airport^(c)	Bay County, FL	143	—	143	Bay County, FL	143	—	143
TownePlace Suites by Marriott Panama City Beach Pier Park^(d)	Bay County, FL	124	—	124
Homewood Suites by Hilton Panama City Beach^(d)					Bay County, FL	131	—	131
TownePlace Suites by Marriott Panama City Beach Pier Park^(e)					Bay County, FL	124	—	124
Total operational rooms		338	7	345		469	7	476

Managed
The Pearl Hotel ^(e)	Walton County, FL	55	—	55
The Pearl Hotel ^(f)					Walton County, FL	55	—	55
Total managed rooms		55	—	55		55	—	55

Under Development/Construction
Embassy Suites by Hilton Panama City Beach^(f)	Bay County, FL	—	255	255
HomeWood Suites by Hilton Panama City Beach	Bay County, FL	—	131	131
Embassy Suites by Hilton Panama City Beach^(g)					Bay County, FL	—	255	255
Hotel Indigo	Bay County, FL	—	124	124	Bay County, FL	—	124	124
The Lodge 30A^(f)	Walton County, FL	—	85	85
Home2 Suites by Hilton Santa Rosa Beach					Walton County, FL	—	107	107
The Lodge 30A^(g)					Walton County, FL	—	85	85
Camp Creek Inn	Walton County, FL	—	75	75	Walton County, FL	—	75	75
Total rooms under development/construction		—	670	670		—	646	646
Total rooms		393	677	1,070		524	653	1,177

(a)	Includes hotels currently in operation, under management or under development and construction. We have significant additional entitlements for future hotel projects on our land holdings.

(b)	Planned additional rooms are currently under construction.

(c)	The hotel opened onin July 8, 2021.

(d)	The hotel opened on March 24, 2022.

(e)	The hotel is operated by our JV ~~partner and opened in May 2020.~~partner. The Pier Park TPS JV is unconsolidated and is accounted for under the equity method of accounting, which is included within our ~~Commercial~~commercial segment.

~~(e)~~(f)

The hotel is owned by a third party but is operated by us.

~~(f)~~(g)

Under development with JV partners.

We own and operate two marinas consisting of the Point South Marina Bay Point in Bay County, Florida and Point South Marina ~~and~~ Port St. Joe ~~Marina.~~in Gulf County, Florida. We are planning new marinas along the Intracoastal Waterway. Our marinas generate revenue from boat slip rentals, boat storage fees and fuel sales, and incur expenses from cost of services provided, maintenance of the marina facilities and personnel costs. At present, we are reconstructing the marinas and expect a portion to be open ~~by the end of 2021.~~in spring 2022. See Note 7. Hurricane Michael for additional information.

We own and operate the WaterColor and WaterColor Kids retail ~~store~~stores that ~~generates~~generate revenue from merchandise sales, which are recognized at the point of sale, and incur expenses from the cost of goods provided, personnel costs and facility costs.

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We own and operate The Powder Room Shooting Range and Training Center (“The Powder Room”) in Panama City Beach, Florida. The approximately 17,000 square feet facility ~~was completed in December 2020 and~~ includes a retail store with firearms and ammunition, as well as training and educational space and 14 shooting lanes. The Powder Room generates revenue from service fees and merchandise sales, which are recognized at the point of sale, and incurs expenses from the cost of services and goods provided, personnel costs and facility costs.

In addition to the properties listed above, we have a number of hospitality projects in various stages of planning.

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Commercial Segment

Our commercial segment includes leasing of commercial property, multi-family, senior living, self-storage and other assets. The commercial segment also oversees the planning, development, entitlement, management and sale of our commercial and rural land holdings for a variety of uses, including a broad range of retail, office, hotel, senior living, multi-family, self-storage and industrial properties. We provide development opportunities for national, regional and local retailers and other strategic partners in Northwest Florida. We own and manage retail shopping centers and develop commercial parcels. We have large land holdings near the Pier Park retail center, adjacent to the Northwest Florida Beaches International Airport, near or within business districts in the region and along major roadways. We also lease land for hunting, rock quarrying and other uses. The commercial segment also manages our timber holdings in Northwest Florida which includes growing and selling pulpwood, sawtimber and other products, such as fill dirt.

The commercial segment generates leasing revenue and incurs leasing expenses primarily from maintenance and management of our properties, personnel costs and asset holding costs. Our commercial segment also generates revenue from the sale of developed and undeveloped land, timber holdings or land with limited development and/or entitlements and the sale of commercial operating properties. Real estate sales in our commercial segment incur costs of revenue directly associated with the land, development, construction, timber and selling costs. Our commercial segment generates timber revenue primarily from open market sales of timber on site without the associated delivery costs. Some of our JV assets and other assets incur interest and financing expenses related to the loans as described in Note 10. Debt, Net.

The commercial segment’s portfolio of leasable properties continues to expand and diversify. Through wholly-owned subsidiaries and consolidated and unconsolidated joint ventures we are in the process of constructing ~~517 apartment~~520 multi-family units and 148 senior living units, in addition to the ~~600 apartment~~877 multi-family units and 107 senior living units that have ~~recently~~ been completed.

Total units and percentage leased/occupied for multi-family and senior living communities by location are as follows:


			March 31, 2022			December 31, 2021
					Percentage			Percentage
					Leased			Leased
		Units	Units	Units	of Units	Units	Units	of Units
	Location	Planned	Completed	Leased	Completed	Completed	Leased	Completed
Multi-family
Pier Park Crossings	Bay County, FL	240	240	236	98%	240	234	98%
Pier Park Crossings Phase II	Bay County, FL	120	120	120	100%	120	113	94%
Watersound Origins Crossings^(a)	Walton County, FL	217	217	215	99%	217	207	95%
Sea Sound^(b)	Bay County, FL	300	300	281	94%	214	203	95%
North Bay Landing^(c)	Bay County, FL	240	—	—	N/A	—	—	N/A
Mexico Beach Crossings^(d)	Bay County, FL	216	—	—	N/A	—	—	N/A
Origins Crossings Townhomes^(e)	Walton County, FL	64	—	—	N/A	—	—	N/A
Total multi-family units		1,397	877	852	97%	791	757	96%

Senior living communities			��
Watercrest	Walton County, FL	107	107	58	54%	107	47	44%
Watersound Fountains^(f)	Walton County, FL	148	—	—	N/A	—	—	N/A
Total senior living units		255	107	58	54%	107	47	N/A
Total units		1,652	984	910	92%	898	804	90%

(a)	Construction was completed in the fourth quarter of 2021.

(b)	Construction was completed in the first quarter of 2022. The Sea Sound Apartments JV is unconsolidated and is accounted for under the equity method of accounting.

(c)	Construction began in the fourth quarter of 2020 and is ongoing.

(d)	Construction began in the first quarter of 2022 and is ongoing.

(e)	Vertical construction began in the third quarter of 2021 and is ongoing.

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(f)	Construction began in the second quarter of 2021 and is ongoing. The Watersound Fountains Independent Living JV is unconsolidated and is accounted for under the equity method of accounting.

Pier Park Crossings, which was developed in two phases, includes 360 completed apartment units in Panama City Beach, Florida. ~~In addition to Pier Park Crossings, we have three apartment communities under construction.~~ Watersound Origins Crossings ~~planned for~~includes 217 ~~units, with 158 units~~ completed ~~as of September 30, 2021, is~~apartment units adjacent to the Watersound Town ~~Center in Watersound, Florida.~~Center. Sea Sound apartments, an unconsolidated JV, ~~planned for~~includes 300 ~~units, with 82 units~~ completed ~~as of September 30, 2021, is located~~apartment units in Panama City Beach, Florida near the Breakfast Point residential ~~communities.~~community. Watercrest includes 107 completed senior living units in Santa Rosa Beach, Florida. In addition, we have three multi-family communities and one senior living community under construction. North Bay Landing, ~~apartments,~~ planned for 240 apartment units, is located in Panama City, Florida. Mexico Beach Crossings, planned for 216 apartment units, is located in Mexico Beach, Florida. Origins Crossings Townhomes, planned for 64 units, is located near the Watersound Town Center. Watersound Fountains, an unconsolidated JV, planned for 148 independent living units, is located near the Watersound Origins residential ~~community in Watersound, Florida.~~community.

Our leasing portfolio consists of approximately ~~986,000~~981,000 square feet of leasable space for mixed-use, retail, industrial, office, self-storage and medical uses. ~~Within the leasing portfolio,~~This includes our mixed-use lease space totals approximately 149,000 square feet. It consists primarily of WaterColor Town Center, WindMark Beach Town Center, Watersound Town Center, WaterSound Gatehouse, WaterColor Crossings and various flex-space buildings. Our retail lease space totals approximately 352,000 square feet. It consists primarily ofconsolidated Pier Park North JV and other leasable properties. Our industrial lease space totals approximately 304,000 square feet, primarily located at VentureCrossings. Our office lease space consists of approximately 91,000 square feet, primarily located in the Beckrich Office Park in Panama City Beach, Florida. Our self-storage lease space consists of approximately 68,000 square feet, which consists of Watersound Self-Storage. Our current medical leased space consists of approximately 22,000 square feet. It consists of a medical clinic at the Watersound Town Center and medical space at Beckrich Office Park.JV. Through separate unconsolidated JVs, other commercial properties include a ~~124 room~~124-room TownePlace Suites by Marriott operated by our JV partner and a Busy Bee branded fuel station and convenience store operated by our JV partner, both located in Panama City Beach, Florida.

The total net rentable square feet and percentage leased of leasing properties by location are as follows:


		March 31, 2022			December 31, 2021
		Net			Net
		Rentable			Rentable
		Square	Percentage		Square	Percentage
	Location	Feet*	Leased		Feet*	Leased
Pier Park North JV	Bay County, FL	320,310	96	%	320,310	95	%
VentureCrossings	Bay County, FL	303,605	88	%	303,605	88	%
Beckrich Office Park^{(a) (b)}	Bay County, FL	77,613	96	%	81,065	85	%
Watersound Self-Storage^(c)	Walton County, FL	67,694	73	%	67,694	50	%
WindMark Beach Town Center^{(a) (d)}	Gulf County, FL	44,748	69	%	44,748	67	%
Watersound Town Center	Walton County, FL	24,764	100	%	24,764	100	%
WaterColor Town Center^(a)	Walton County, FL	22,199	100	%	22,199	100	%
Cedar Grove Commerce Park	Bay County, FL	19,389	100	%	19,389	100	%
Port St. Joe Commercial	Gulf County, FL	16,964	100	%	16,964	100	%
Beach Commerce Park^(a)	Bay County, FL	14,800	100	%	14,800	100	%
SummerCamp Commercial	Franklin County, FL	13,000	0	%	13,000	0	%
South Walton Commerce Park^(e)	Walton County, FL	11,570	100	%	11,570	88	%
WaterSound Gatehouse^(a)	Walton County, FL	10,271	100	%	10,271	100	%
WaterColor Crossings	Walton County, FL	7,135	100	%	7,135	100	%
395 Office building	Walton County, FL	6,700	100	%	6,700	100	%
Pier Park outparcel	Bay County, FL	5,565	100	%	5,565	100	%
Topsail West Commercial	Walton County, FL	3,500	100	%	3,500	100	%
Bank building	Bay County, FL	3,346	100	%	3,346	100	%
Bank building	Gulf County, FL	3,346	100	%	3,346	100	%
WaterColor HOA Office	Walton County, FL	2,520	100	%	2,520	100	%
RiverCamps	Bay County, FL	2,112	100	%	2,112	100	%
		981,151	90	%	984,603	87	%

*	Net Rentable Square Feet is designated as the current square feet available for lease as specified in the applicable lease agreements plus management’s estimate of space available for lease based on construction drawings.

(a)	In addition to net rentable square feet there is also space that we occupy or that serves as common area.

(b)	Included in net rentable square feet as of March 31, 2022 and December 31, 2021, is 1,500 square feet leased to a consolidated JV.

(c)	Construction was completed in the third quarter of 2021.

(d)	Included in net rentable square feet as of March 31, 2022 and December 31, 2021, is 13,808 square feet of unfinished space.

(e)	Included in net rentable square feet as of March 31, 2022 and December 31, 2021, is 1,364 square feet leased to a consolidated JV.

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We have other commercial projects under development and construction. ~~These include~~This includes a Publix supermarket totaling approximately 50,000 square feet, in-line space totaling approximately 12,000 square feet and a ~~multi-tenant commercial building in the Watersound Town Center~~build-to-suit project totaling approximately ~~6,500~~3,350 square feet. We have commenced development of Watersound West Bay Center, a lifestyle shopping center adjacent to Latitude Margaritaville Watersound residential community in Panama City Beach, Florida. Watersound West Bay Center has potential to include approximately 350,000 square feet of leasable space at build out, featuring a mix of retail, restaurant, office and medical space. We have also commenced development on the second phase of South Walton Commerce Park. In addition to the properties listed above, we have a number of projects in various stages of planning, including additional commercial buildings and apartment communities.

Critical Accounting Estimates

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures of contingent assets and liabilities. We base these estimates on historical experience, available current market information and on various other assumptions that management believes are reasonable under the circumstances. Additionally, we evaluate the results of these estimates on an on-going basis. Management’s estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions and our accounting estimates are subject to change.

Critical accounting policies that we believe reflect our more significant judgments and estimates used in the preparation of our condensed consolidated financial statements are set forth in Item 7 of our Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021. There have been no significant changes in these policies during the first ~~nine~~three months of ~~2021,~~2022, however we cannot assure you that these policies will not change in the future.

Recently Adopted and Issued Accounting Pronouncements

See Note 2. Summary of Significant Accounting Policies to our condensed consolidated financial statements included in this report for recently issued or adopted accounting standards, including the date of adoption and effect on our condensed consolidated financial statements.

Seasonality and Market Variability

Our operations may be affected by seasonal fluctuations. Hospitality revenues have historically been lower in the first ~~quarter~~and fourth quarters and are normally higher in the second and third quarters, ~~and~~but may vary period-to-period with the timing of holidays and extraordinary events such as the COVID-19 pandemic. Homesites sell in sporadic transactions in various communities that may impact quarterly results. Commercial sales may vary from ~~period to period.~~period-to-period.

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Results of Operations

Consolidated Results

The following table sets forth a comparison of the results of our operations:


	Three Months Ended				Nine Months Ended				Three Months Ended
	September 30,				September 30,				March 31,
	2021		2020		2021		2020		2022		2021

	In millions								In millions
Revenue:
Real estate revenue	$	23.5	$	18.5	$	85.6	$	41.8	$	36.8	$	21.0
Hospitality revenue		22.3		17.0		58.0		35.2		16.3		13.1
Leasing revenue		7.1		4.9		19.1		14.2		8.8		5.6
Timber revenue		1.0		1.6		4.8		5.5		3.0		1.6
Total revenue		53.9		42.0		167.5		96.7		64.9		41.3
Expenses:
Cost of real estate revenue		8.5		9.4		33.1		18.4		15.3		10.5
Cost of hospitality revenue		16.5		11.0		43.5		26.5		14.9		11.5
Cost of leasing revenue		3.1		2.0		8.3		4.0		3.7		2.7
Cost of timber revenue		0.1		0.2		0.5		0.6		0.2		0.1
Other operating and corporate expenses		5.0		5.1		17.1		17.0
Corporate and other operating expenses										5.6		7.1
Depreciation, depletion and amortization		4.6		3.3		12.6		9.4		5.0		3.9
Total expenses		37.8		31.0		115.1		75.9		44.7		35.8
Operating income		16.1		11.0		52.4		20.8		20.2		5.5
Other income (expense):
Investment income, net		2.3		2.4		4.8		2.8		2.3		1.2
Interest expense		(4.1)		(3.4)		(11.6)		(10.1)		(4.1)		(3.6)
Gain on contribution to equity method investment		—		—		3.3		19.6
Other income, net		7.4		0.3		9.6		0.7
Total other income (expense), net		5.6		(0.7)		6.1		13.0
Income before equity in loss from unconsolidated affiliates and income taxes		21.7		10.3		58.5		33.8
Equity in loss from unconsolidated affiliates		(0.5)		(0.1)		(1.6)		(0.3)
Gain on contributions to unconsolidated joint ventures										0.5		0.1
Other (expense) income, net										(0.4)		1.3
Total other expense, net										(1.7)		(1.0)
Income before equity in loss from unconsolidated joint ventures and income taxes										18.5		4.5
Equity in loss from unconsolidated joint ventures										(0.5)		(0.5)
Income tax expense		(6.4)		(2.4)		(15.2)		(7.8)		(4.5)		(1.0)
Net income	$	14.8	$	7.8	$	41.7	$	25.7	$	13.5	$	3.0

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Real Estate Revenue and Gross Profit

The following table sets forth a comparison of our total consolidated real estate revenue and gross profit:


	Three Months Ended September 30,								Nine Months Ended September 30,								Three Months Ended March 31,
	2021		% ^(a)		2020		% ^(a)		2021		% ^(a)		2020		% ^(a)		2022		% ^(a)		2021		% ^(a)

	Dollars in millions																Dollars in millions
Revenue:
Residential real estate revenue	$	21.6	91.9	%	$	16.1	87.0	%	$	74.7	87.3	%	$	33.1	79.2	%	$	32.7	88.9	%	$	20.5	97.6	%
Commercial and rural real estate revenue		1.6	6.8	%		2.2	11.9	%		9.8	11.4	%		7.2	17.2	%		3.6	9.8	%		—	—	%
Other revenue		0.3	1.3	%		0.2	1.1	%		1.1	1.3	%		1.5	3.6	%		0.5	1.3	%		0.5	2.4	%
Real estate revenue	$	23.5	100.0	%	$	18.5	100.0	%	$	85.6	100.0	%	$	41.8	100.0	%	$	36.8	100.0	%	$	21.0	100.0	%

Gross profit:
Residential real estate	$	13.5	62.5	%	$	7.6	47.2	%	$	44.2	59.2	%	$	17.1	51.7	%	$	18.9	57.8	%	$	10.3	50.2	%
Commercial and rural real estate		1.4	87.5	%		1.4	63.6	%		8.0	81.6	%		5.0	69.4	%		2.5	69.4	%		—	—	%
Other		0.1	33.3	%		0.1	50.0	%		0.3	27.3	%		1.3	86.7	%		0.1	20.0	%		0.2	40.0	%
Gross profit	$	15.0	63.8	%	$	9.1	49.2	%	$	52.5	61.3	%	$	23.4	56.0	%	$	21.5	58.4	%	$	10.5	50.0	%

(a)	Calculated percentage of total real estate revenue and the respective gross margin percentage.

Residential Real Estate Revenue and Gross Profit. During the three months ended ~~September 30, 2021,~~March 31, 2022, residential real estate revenue increased ~~$5.5~~$12.2 million, or 59.5%, to ~~$21.6~~$32.7 million, as compared to ~~$16.1~~$20.5 million during the same period in ~~2020.~~2021. During the three months ended ~~September 30, 2021,~~March 31, 2022, residential real estate gross profit increased ~~$5.9~~$8.6 million to ~~$13.5 (or gross margin of 62.5%), as compared to $7.6~~$18.9 million (or gross margin of ~~47.2%~~57.8%), as compared to $10.3 million (or gross margin of 50.2%) during the same period in ~~2020.~~2021. During the three months ended ~~September 30, 2021,~~March 31, 2022, we sold ~~119~~181 homesites and had no unimproved residential land sales of $0.1 million, compared to 162 homesites and an unimproved residential land sale of $0.4 million during the same period in 2020. During the three months ended September 30, 2021 and 2020, the average revenue, excluding homesite residuals, per homesite sold was approximately $159,000 and $82,000, respectively, due to the mix of sales from different communities.

During the nine months ended September 30, 2021, residential real estate revenue increased $41.6 million to $74.7 million, as compared to $33.1 million during the same period in 2020. During the nine months ended September 30, 2021, residential real estate gross profit increased $27.1 million to $44.2 (or gross margin of 59.2%), as compared to $17.1 million (or gross margin of 51.7%) during the same period in 2020. During the nine months ended September 30, 2021, we sold 494203 homesites, two homes and had unimproved residential land sales of $0.1 million ~~compared to 303 homesites, no home sales and had unimproved residential land sales of $1.7 million~~ during the same period in ~~2020.~~2021. During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the average revenue, excluding homesite residuals, per homesite sold was approximately ~~$125,000~~$150,000 and ~~$86,000,~~$73,000, respectively, due to the mix of sales from different communities. The revenue, gross profit and margin improvement for each period was impacted by the volume of sales within each of the communities, the difference in pricing among the communities and the difference in the cost of the homesite development. The number of homesites sold varied each period due to the timing of homebuilder contractual closing obligations and the timing of development of completed homesites in our residential communities.

Commercial and Rural Real Estate Revenue and Gross Profit. During the three months ended ~~September 30, 2021,~~March 31, 2022, we had ~~five~~six commercial and rural real estate sales totaling approximately ~~423~~13 acres for ~~$1.6~~$3.3 million and land improvement services of $0.3 million, together resulting in a gross profit of $2.5 million (or gross margin of ~~approximately 87.5%~~69.4%). During the three months ended ~~September 30, 2020,~~March 31, 2021, we had ~~seven~~one commercial and rural real estate ~~sales~~sale totaling approximately ~~232 acres~~one acre for ~~$2.2 million, resulting in a gross profit margin of approximately 63.6%.~~

~~Table of Contents~~

During the nine months ended September 30, 2021, we had thirteen commercial and rural real estate sales totaling approximately 536 acres for $9.8 million, resulting in a gross profit margin of approximately 81.6%. During the nine months ended September 30, 2020, we had nineteen commercial and rural real estate sales totaling approximately 433 acres for $7.2 million, resulting in a gross profit margin of approximately 69.4%.less than $0.1 million. Revenue from commercial and rural real estate can vary significantly from ~~period to period~~period-to-period depending on the proximity to developed areas and mix of real estate sold in each period, with varying compositions of retail, office, industrial and other commercial uses.

Our gross margin can vary significantly from ~~period to period~~period-to-period depending on the characteristics of property sold. Sales of rural and timber land typically have a lower cost basis than residential and commercial real estate sales. In addition, our cost basis in residential and commercial real estate can vary depending on the amount of development or other costs ~~spent~~incurred on the property.

Other Revenue. Other revenue primarily consists of mitigation bank credit sales ~~title fee~~ and ~~insurance~~title business revenue.

Table of Contents

Hospitality Revenue and Gross Profit


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2021			2020			2021			2020			2022			2021

	In millions												In millions
Hospitality revenue	$	22.3		$	17.0		$	58.0		$	35.2		$	16.3		$	13.1
Gross profit	$	5.8		$	6.0		$	14.5		$	8.7		$	1.4		$	1.6
Gross margin		26.0	%		35.3	%		25.0	%		24.7	%		8.6	%		12.2	%

Hospitality revenue increased ~~$5.3~~$3.2 million, or ~~31.2%~~24.4%, to ~~$22.3~~$16.3 million during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$17.0~~$13.1 million in the same period in ~~2020. During the three months ended September 30, 2021, the~~2021. The increase in hospitality revenue was primarily related to ~~higher demand in lodging and resort amenities due to~~ increased popularity of the region and year-round travel that resulted in an ~~influx~~increase of members ~~and guests~~ from new ~~markets. Our hospitality~~markets, as well as an increase in lodging revenue from the Hilton Garden Inn Panama City Airport, which opened in July 2021. As of March 31, 2022, Watersound Club had 2,271 members, compared with 1,722 members as of March 31, 2021, an increase of 549 members. Hospitality had a gross margin ~~decreased to 26.0%~~of 8.6% during the three months ended ~~September 30, 2021,~~March 31, 2022, compared to ~~35.3%~~12.2% during the same period in ~~2020.~~ 2021. The decrease in gross margin iswas due to~~increased sales incentive costs related to the growth of our club memberships,~~ pre-opening expenses associated with the opening of Homewood Suites by Hilton ~~Garden Inn~~ Panama City ~~Airport,~~Beach, onboarding of staff for future assets currently under construction and an increase in cost of labor and ~~products.~~

~~Hospitality revenue increased $22.8 million, or 64.8%, to $58.0 million during the nine months ended September 30, 2021, as compared to $35.2 million~~products in the same period in 2020. During the nine months ended September 30, 2021 the increase in hospitality revenue was primarily related to higher demand in lodging and resort amenities due to increased popularity of the region and year-round travel that resulted in an influx of members and guests from new markets. The increase was also due to the impact of the COVID-19 pandemic on the prior period, which resulted in shutdowns and reduced revenue from mid-March to mid-May 2020. As of September 30, 2021, Watersound Club had 2,158 members, compared with 1,448 members as of September 30, 2020, an increase of 710 members. Hospitality gross margin of 25.0% during the nine months ended September 30, 2021, was comparable to the gross margin of 24.7% during the same period in 2020.current period.

Leasing Revenue and Gross Profit


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2021			2020			2021			2020			2022			2021

	In millions												In millions
Leasing revenue	$	7.1		$	4.9		$	19.1		$	14.2		$	8.8		$	5.6
Gross profit	$	4.0		$	2.9		$	10.8		$	10.2		$	5.1		$	2.9
Gross margin		56.3	%		59.2	%		56.5	%		71.8	%		58.0	%		51.8	%

Leasing revenue increased ~~$2.2~~$3.2 million, or ~~44.9%~~57.1%, to ~~$7.1~~$8.8 million during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$4.9~~$5.6 million in the same period in ~~2020. Leasing revenue increased $4.9 million, or 34.5%, to $19.1 million during the nine months ended September 30, 2021, as compared to $14.2 million in the same~~

~~Table of Contents~~

~~period in 2020.~~2021. The increase ~~in the periods is~~was primarily due to ~~new leases at Pier Park Crossings Phase II apartments, which began leasing in the fourth quarter of 2020 and~~ new leases at Watersound Origins Crossings apartments and Watercrest senior living community, ~~which began leasing in the first quarter of 2021,~~ as well as other new leases. Leasing gross margin ~~decreased~~increased during the three months ended ~~September 30, 2021,~~March 31, 2022 to ~~56.3%~~58.0%, as compared to ~~59.2%~~51.8% during the same period in ~~2020,~~2021, primarily due to start-up and lease-up expenses for new assets in the current period. Leasing gross margin decreased during the nine months ended September 30, 2021 to 56.5%, as compared to 71.8% during the same period in 2020, primarily due to start-up and lease-up expenses for new assets in the current period and $0.7 million of business interruption proceeds received for Pier Park Crossings apartments related to Hurricane Michael in the prior period.

Timber Revenue and Gross Profit


	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended March 31,
	2021			2020			2021			2020			2022			2021

	In millions												In millions
Timber revenue	$	1.0		$	1.6		$	4.8		$	5.5		$	3.0		$	1.6
Gross profit	$	0.9		$	1.4		$	4.3		$	4.9		$	2.8		$	1.5
Gross margin		90.0	%		87.5	%		89.6	%		89.1	%		93.3	%		93.8	%

Timber revenue ~~decreased $0.6~~increased $1.4 million, or ~~37.5%~~87.5%, to ~~$1.0~~$3.0 million during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to $1.6 million in the same period in ~~2020.~~2021. The ~~decrease is~~increase was primarily due to ~~a decrease~~an increase in the ~~amount~~tons of wood ~~product tons~~products sold, ~~which were partially offset by~~along with price increases and sales mix of different wood products in the current ~~period, as well as a decrease in the sales of fill dirt and other products.~~period. There were ~~50,000~~107,000 tons of wood products sold during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~84,000~~76,000 tons of wood products sold during the same period in ~~2020.~~2021.

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Corporate and Other Operating Expenses


	Three Months Ended March 31,
	2022		2021

	In millions
Employee costs	$	2.4	$	3.8
Property taxes and insurance		1.3		1.4
Professional fees		1.1		0.8
Marketing and owner association costs		0.2		0.7
Occupancy, repairs and maintenance		0.2		0.1
Other miscellaneous		0.4		0.3
Total corporate and other operating expenses	$	5.6	$	7.1

~~Timber revenue~~Corporate and other operating expenses decreased ~~$0.7 million, or 12.7%, to $4.8~~$1.5 million during the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$5.5 million in~~ the same period in ~~2020.~~2021. The decrease is primarily due to ~~a decrease in~~$1.2 million of expense during the ~~sales of fill dirt and other products. The decrease was partially offset by an increase due~~three months ended March 31, 2021 to 401(k) plan participants related to the ~~sales mix~~final allocation of ~~different wood products and price increases~~surplus assets from the pension plan termination in ~~the current period. There were 223,000 tons of wood products sold during the nine months ended September 30, 2021, as compared to 275,000 tons of wood products sold during the same period in 2020.~~

~~Other Operating and Corporate Expenses~~

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

In millions
Employee costs

$
2.0

$
2.0

$
6.6

$
6.3
401(k) contribution

—

—

1.2

1.2
Property taxes and insurance

1.4

1.3

4.1

3.8
Professional fees

0.7

1.0

2.3

3.2
Marketing and owner association costs

0.3

0.4

��
1.3

0.9
Occupancy, repairs and maintenance

0.3

0.2

0.5

0.6
Other miscellaneous

0.3

0.2

1.1

1.0
Total other operating and corporate expenses

$
5.0

$
5.1

$
17.1

$
17.0

~~Other operating and corporate expenses for the three and nine months ended September 30, 2021 and 2020, were comparable.~~2014.

Depreciation, Depletion and Amortization

Depreciation, depletion and amortization expense increased ~~$1.3 million and $3.2~~$1.1 million during the three ~~and nine~~ months ended ~~September 30, 2021, respectively,~~March 31, 2022, as compared to the same period in ~~2020,~~2021, primarily due to new hospitality and commercial assets placed in service.

~~Table of Contents~~

Investment Income, Net

Investment income, net primarily includes (i) interest and dividends earned ~~(ii)~~and accretion of the net discount ~~(iii) net realized gain or loss from the sale of available-for-sale-investments and equity securities, (iv)~~(ii) net unrealized gain or loss related to investments - equity securities, ~~(v)~~(iii) interest income earned on the time deposit held by SPE and ~~(vi)~~(iv) interest earned on mortgage notes receivable and other receivables as detailed in the table below:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2021		2020		2021		2020		2022		2021

	In millions								In millions
Interest and dividend income	$	—	$	—	$	—	$	1.1
Accretion income		—		—		0.1		0.1
Net realized loss on the sale of investments		—		—		—		(0.1)
Unrealized gain (loss) on investments, net		0.1		0.3		(1.9)		(4.6)
Interest, dividend and accretion income									$	0.1	$	—
Unrealized loss on investments, net										—		(1.0)
Interest income from investments in special purpose entities		2.0		2.0		6.1		6.1		2.0		2.0
Interest earned on notes receivable and other interest		0.2		0.1		0.5		0.2		0.2		0.2
Total investment income, net	$	2.3	$	2.4	$	4.8	$	2.8	$	2.3	$	1.2

Investment income, net increased $1.1 million to $2.3 million for the three months ended ~~September 30, 2021 and 2020, were comparable. Investment income, net increased $2.0 million to $4.8 million for the nine months ended September 30, 2021,~~March 31, 2022, as compared to ~~$2.8~~$1.2 million in the same period in ~~2020.~~2021. The ~~nine~~three months ended ~~September 30, 2021, had interest and dividend income~~March 31, 2022 includes unrealized gains related to preferred stock of less than $0.1 million, compared to interest and dividend income of $1.1 million during the prior period. The decrease in interest and dividend income for the nine months ended September 30, 2021, as compared to the same period in 2020, is primarily due to the change in investments held during the period. The nine months ended September 30, 2021 includes unrealized losses related to preferred stock of ~~$1.9 million, compared to $4.6~~$1.0 million during the prior period.

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Interest Expense

Interest expense primarily includes interest incurred on the Senior Notes issued by Northwest Florida Timber Finance, LLC, project financing, CDD debt and finance leases, as well as amortization of debt discount and premium and debt issuance costs as detailed in the table below:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2021		2020		2021		2020		2022		2021

	In millions								In millions
Interest expense and amortization of discount and issuance costs for Senior Notes issued by special purpose entity	$	2.2	$	2.2	$	6.6	$	6.6	$	2.2	$	2.2
Other interest expense		1.9		1.2		5.0		3.5		1.9		1.4
Total interest expense	$	4.1	$	3.4	$	11.6	$	10.1	$	4.1	$	3.6

Interest expense increased ~~$0.7~~$0.5 million, or ~~20.6%~~13.9%, to $4.1 million during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$3.4~~$3.6 million in the same period in ~~2020. Interest expense increased $1.5 million, or 14.9%, to $11.6 million during the nine months ended September 30, 2021, as compared to $10.1 million in the same period in 2020.~~2021. The increase in interest expense is primarily related to the increase in project financing. See Note 10. Debt, Net for additional information regarding project financing.

Gain on ~~Contribution~~Contributions to ~~Equity Method Investment~~Unconsolidated Joint Ventures

~~We did not have any gain~~Gain on ~~contribution~~contributions to ~~equity method investment~~unconsolidated joint ventures during the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020. Gain on contribution to equity method investment during the nine months ended September 30, 2021 and 2020,~~ was ~~$3.3~~$0.5 million and ~~$19.6~~$0.1 million, respectively. The ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, includes a gain of ~~$0.2~~$0.4 million on land contributed to our unconsolidated Electric Cart Watersound JV. Each of the three months ended March 31, 2022 and 2021, also includes a gain of $0.1 million on additional infrastructure improvements contributed to our unconsolidated Latitude Margaritaville Watersound JV. The nine months ended September 30, 2021, also includes a gain of $3.1 million on land contributed to our unconsolidated Watersound Fountains Independent Living JV. The nine months ended September 30, 2020, includes

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a gain of $15.3 million on land contributed to our unconsolidated Latitude Margaritaville Watersound JV. The nine months ended September 30, 2020, also includes a gain of $4.3 million on land and mitigation credits contributed to our unconsolidated Sea Sound Apartments JV. See Note 4. Joint Ventures for additional information.

Other (Expense) Income, Net

Other (expense) income, net primarily includes income from our retained interest investments, gain on insurance recovery, loss from hurricane damage and other income and expense items as detailed in the table below:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2021		2020		2021		2020		2022		2021

	In millions								In millions
Accretion income from retained interest investments	$	0.4	$	0.4	$	1.1	$	1.1	$	0.4	$	0.3
Gain on insurance recovery		2.5		—		3.9		—		0.7		0.9
Loss from hurricane damage		—		(0.6)		—		(1.1)		—		—
Miscellaneous income, net		4.5		0.5		4.6		0.7
Other income, net	$	7.4	$	0.3	$	9.6	$	0.7
Miscellaneous (expense) income, net										(1.5)		0.1
Other (expense) income, net									$	(0.4)	$	1.3

Other (expense) income, net ~~increased $7.1~~decreased $1.7 million to ~~$7.4~~other expense, net of $0.4 million during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$0.3~~other income, net of $1.3 million in the same period in ~~2020. Other income, net increased $8.9 million to $9.6 million during the nine~~2021. The three months ended ~~September 30,~~March 31, 2022 and 2021, ~~as compared to $0.7 million in the same period in 2020. The three and nine months ended September 30, 2021, include~~includes a gain on insurance recovery of ~~$2.5~~$0.7 million and ~~$3.9~~$0.9 million, respectively, and loss from hurricane damage of less than $0.1 million during each period related to Hurricane Michael. The three and nine months ended September 30, 2020, did not include any gain on insurance recovery, but includes $0.6 million and $1.1 million, respectively, of loss from hurricane damage related to Hurricane Michael. See Note 7. Hurricane Michael for additional information. Miscellaneous ~~income,~~expense, net during the three ~~and nine~~ months ended ~~September 30, 2021,~~March 31, 2022, includes ~~$3.6~~$1.1 million ~~received from the Florida Division~~ of ~~Emergency Management’s TRBG program~~design costs no longer pursued and $0.6 million for ~~recovery of lost income related to timber crop that was destroyed as~~ a ~~result of Hurricane Michael. We have met all requirements related to the TRBG program as of September 30, 2021. See Note 7.~~ ~~Hurricane Michael~~ ~~and Note 16.~~ ~~Other Income (Expense), Net~~ ~~for additional information.~~homeowner’s association special assessment.

Income Tax Expense

~~We recorded income~~Income tax expense ~~of $6.4~~was $4.5 million during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$2.4~~$1.0 million during the same period in ~~2020.~~2021. Our effective tax rate was ~~29.7%~~25.3% for the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~23.9%~~24.8% during the same period in ~~2020.~~2021.

~~We recorded income tax expense~~55

Table of $15.2 million during the nine months ended September 30, 2021, as compared to $7.8 million during the same period in 2020. Our effective tax rate was 26.3% for the nine months ended September 30, 2021, as compared to 23.6% during the same period in 2020.Contents

Our effective rate for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022, differed from the federal statutory rate of 21.0% primarily due to state income taxes and income tax credits related to our multi-family projects. Our effective rate for the three months ended March 31, 2021, differed from the federal statutory rate of 21.0% primarily due to state income taxes the change in the 2021 Florida income tax rate from 4.458% to 3.535%, tax credits and other permanent differences. Our effective rate for the three and nine months ended September 30, 2020, differed from the federal statutory rate of 21.0% primarily due to state income taxes, tax credits and other permanent differences. See Note ~~12.~~13. Income Taxes for additional information.

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Segment Results

Residential

The table below sets forth the consolidated results of operations of our residential segment:


	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
	2021		2020		2021		2020		2022		2021

	In millions								In millions
Revenue:
Real estate revenue	$	20.6	$	14.9	$	70.3	$	30.2	$	30.4	$	18.8
Hospitality revenue		0.4		0.2		0.6		0.3		0.1		0.1
Leasing revenue		0.2		—		0.2		0.1		0.1		0.1
Other revenue		1.0		1.2		4.4		2.9		2.3		1.7
Total revenue		22.1		16.3		75.5		33.5		32.9		20.7
Expenses:
Cost of real estate and other revenue		8.1		8.4		30.5		16.0		13.7		10.3
Cost of hospitality revenue		0.2		0.2		0.4		0.5		0.2		0.2
Cost of leasing revenue		—		—		0.1		—		0.1		—
Other operating expenses		1.1		1.4		3.9		3.8		0.9		1.6
Depreciation and amortization		0.1		0.1		0.3		0.2
Depreciation, depletion and amortization										0.1		0.1
Total expenses		9.5		10.1		35.2		20.5		15.0		12.2
Operating income		12.6		6.2		40.3		13.0		17.9		8.6
Other income (expense):
Investment income, net		0.2		0.1		0.5		0.1		0.2		0.2
Interest expense		(0.1)		(0.2)		(0.4)		(0.5)		(0.1)		(0.2)
Gain on contribution to equity method investment		—		—		0.2		15.3
Other income, net		0.2		0.1		0.4		0.3
Total other income, net		0.3		—		0.7		15.2
Income before equity in loss from unconsolidated affiliates and income taxes	$	12.9	$	6.2	$	41.0	$	28.2
Gain on contributions to unconsolidated joint ventures										—		0.1
Other expense, net										(0.9)		—
Total other (expense) income, net										(0.8)		0.1
Income before equity in loss from unconsolidated joint ventures and income taxes									$	17.1	$	8.6

Real estate revenue includes sales of homesites, homes and other residential land and certain homesite residuals from homebuilder sales that provide us a percentage of the sale price of the completed home if the home price exceeds a negotiated threshold. Hospitality revenue includes some of our short-term vacation rentals. Leasing revenue includes long-term leases of residential assets. Other revenue includes tap and impact fee credits sold and marketing fees. Certain homesite residuals and other revenue related to homebuilder homesite sales are recognized in revenue at the point in time of the closing of the sale. For the three months ended ~~September 30, 2021 real estate revenue did not include any estimated homesite residuals. For the nine months ended September 30,~~March 31, 2022 and 2021, real estate revenue includes estimated homesite residuals of ~~$2.2 million. For the three and nine months ended September 30, 2021 other revenue includes estimated fees related to homebuilder homesite sales of $0.2~~$1.9 million and ~~$1.5 million, respectively. For the three and nine months ended September 30, 2020 real estate revenue includes estimated homesite residuals of $0.4 million and $0.8~~$1.1 million, respectively, and other revenue includes estimated fees related to homebuilder homesite sales of ~~$0.7~~$0.5 million and ~~$1.3~~$0.6 million, respectively. Cost of real estate revenue includes direct costs (e.g., development and construction costs), selling costs and other indirect costs.

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Three months ended ~~September 30, 2021~~March 31, 2022 compared to the three months ended ~~September 30, 2020~~March 31, 2021

The following table sets forth our consolidated residential real estate revenue and cost of revenue activity:


	Three Months Ended September 30, 2021									Three Months Ended September 30, 2020									Three Months Ended March 31, 2022									Three Months Ended March 31, 2021
	Unit			Cost of		Gross		Gross		Units			Cost of		Gross		Gross		Units			Cost of		Gross		Gross		Units			Cost of		Gross		Gross
	Sold	Revenue		Revenue		Profit		Margin		Sold	Revenue		Revenue		Profit		Margin		Sold	Revenue		Revenue		Profit		Margin		Sold	Revenue		Revenue		Profit		Margin

	Dollars in millions																		Dollars in millions
Consolidated
Homesites	119	$	20.6	$	7.4	$	13.2	64.1	%	162	$	14.5	$	7.4	$	7.1	49.0	%	181	$	30.3	$	12.9	$	17.4	57.4	%	203	$	17.7	$	8.7	$	9.0	50.8	%
Land sale	N/A		—		—		—	—	%	N/A		0.4		0.4		—	—	%
Homes																			—		—		—		—	—	%	2		1.0		0.9		0.1	10.0	%
Land sales																			N/A		0.1		—		0.1	100.0	%	N/A		0.1		—		0.1	100.0	%
Total consolidated																			181	$	30.4	$	12.9	$	17.5	57.6	%	205	$	18.8	$	9.6	$	9.2	48.9	%

Unconsolidated
Homes^(a)																			18									—
Total	119	$	20.6	$	7.4	$	13.2	64.1	%	162	$	14.9	$	7.8	$	7.1	47.7	%	199									205

(a)	Includes homes sold by the Latitude Margaritaville Watersound JV, which is unconsolidated and is accounted for under the equity method of accounting. See Note 4. Joint Ventures for additional information.

Homesites. Revenue from homesite sales increased ~~$6.1~~$12.6 million, or 71.2%, during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to the same period in ~~2020,~~2021, primarily due to the mix and number of homesites sold per community, the timing of homebuilder contractual closing obligations and the timing of development of completed homesites in our residential communities. During the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ the average revenue, excluding homesite residuals, per homesite sold was approximately ~~$159,000~~$150,000 and ~~$82,000, respectively,~~$73,000, respectively. The increase in average revenue per homesite sold during the current period, was due to the mix of sales from different communities. Gross margin increased to ~~64.1%~~57.4% during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~49.0%~~50.8% during the same period in ~~2020,~~2021, primarily due to the mix and number of homesites sold from different communities during each respective period. Gross margin may vary each period depending on the location of homesite sales.

~~Land sales.~~ Homes. During the three months ended ~~September 30, 2021,~~March 31, 2022, we did not have any ~~unimproved residential land~~home sales. During the three months ended ~~September 30, 2020,~~March 31, 2021, we sold two completed homes within our RiverCamps community for a total of $1.0 million, resulting in a gross profit margin of 10.0%.

Land sales. During each of the three months ended March 31, 2022 and 2021, we had an unimproved residential land ~~sale~~sales for ~~$0.4~~$0.1 million, ~~resulting in no gross profit margin.~~with de minimis cost of revenue.

Other operating expenses include salaries and benefits, property taxes, marketing, professional fees, project administration, owner association and CDD assessments and other administrative expenses.

Investment income, net primarily consists of interest earned on our notes receivable. Interest expense ~~consists of interest incurred on our portion of the total outstanding CDD debt.~~

~~Nine months ended September 30, 2021 compared to the nine months ended September 30, 2020~~

~~The following table sets forth our residential real estate revenue and cost of revenue activity:~~

Nine Months Ended September 30, 2021

Nine Months Ended September 30, 2020


Units



Cost of

Gross

Gross


Units



Cost of

Gross

Gross

Sold

Revenue

Revenue

Profit

Margin

Sold

Revenue

Revenue

Profit

Margin

Dollars in millions

Homesites

494

$
69.2

$
27.5

$
41.7

60.3
%

303

$
28.5

$
14.3

$
14.2

49.8
%
Homes

2

1.0

0.9

0.1

10.0
%

—

—

—

—

—
%
Land sales

N/A

0.1

—

0.1

100.0
%

N/A

1.7

0.4

1.3

76.5
%
Total

496

$
70.3

$
28.4

$
41.9

59.6
%

303

$
30.2

$
14.7

$
15.5

51.3
%

~~Homesites~~~~. Revenue from homesite sales increased $40.7 million during the nine months ended September 30, 2021, as compared to the same period in 2020,~~ primarily due to the mix and number of homesites sold per community, the timing of homebuilder contractual closing obligations and the timing of development of completed homesites in our residential communities. During the nine months ended September 30, 2021 and 2020, the average revenue, excluding homesite residuals, per homesite sold was approximately $125,000 and $86,000, respectively, due to the mix of sales from different communities. ~~Gross margin increased to 60.3% during the nine months ended September 30, 2021, as compared to 49.8% during the same period in 2020, primarily due to the mix and number of~~

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~~homesites sold from different communities during each respective period. Gross margin may vary each period depending on the location of homesite sales.~~

~~Homes~~. During the nine months ended September 30, 2021, we sold two completed homes within our RiverCamps community for a total of $1.0 million, resulting in a gross profit margin of 10.0%. During the nine months ended September 30, 2020, we did not have any home sales.

~~Land sales.~~ During the nine months ended September 30, 2021, we had unimproved residential land sales for $0.1 million, with de minimis cost of revenue. During the nine months ended September 30, 2020, we had unimproved residential land sales for $1.7 million, resulting in a gross profit margin of 76.5%.

~~Other operating expenses include salaries and benefits, property taxes, marketing, professional fees, project administration, owner association and CDD assessments and other administrative expenses.~~

~~Investment income, net primarily consists of interest earned on our notes receivable. Interest expense~~ consists of interest incurred on our portion of the total outstanding CDD debt.

Gain on ~~contribution~~contributions to ~~equity method investment~~unconsolidated joint ventures for each of the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, includes a gain of ~~$0.2~~$0.1 million on additional infrastructure improvements contributed to our unconsolidated Latitude Margaritaville Watersound JV. Gain on contribution to equity method investment for the nine months ended September 30, 2020, includes a gain of $15.3 million on land contributed to our unconsolidated Latitude Margaritaville Watersound JV. See Note 4. Joint Ventures for additional information.

~~Hospitality~~

~~The table below sets forth~~Other expense, net for the ~~results~~three months ended March 31, 2022 includes $1.0 million of ~~operations of our hospitality segment:~~

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

In millions
Revenue:








Hospitality revenue

$
22.0

$
16.8

$
57.4

$
34.8
Expenses:








Cost of hospitality revenue

16.3

10.8

42.9

26.1
Other operating expenses

0.2

0.3

0.5

0.7
Depreciation and amortization

1.7

1.2

4.4

3.5
Total expenses

18.2

12.3

47.8

30.3
Operating income

3.8

4.5

9.6

4.5
Other (expense) income:








Interest expense

(0.2)

(0.1)

(0.3)

(0.1)
Other income, net

0.6

0.5

0.6

0.7
Other income, net

0.4

0.4

0.3

0.6
Income before equity in loss from unconsolidated affiliates and income taxes

$
4.2

$
4.9

$
9.9

$
5.1

design costs no longer pursued.

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Hospitality

The table below sets forth the consolidated results of operations of our hospitality segment:


	Three Months Ended March 31,
	2022		2021

	In millions
Revenue:
Hospitality revenue	$	16.2	$	13.0
Expenses:
Cost of hospitality revenue		14.7		11.3
Other operating expenses		0.2		—
Depreciation, depletion and amortization		1.8		1.4
Total expenses		16.7		12.7
Operating (loss) income		(0.5)		0.3
Other expense:
Interest expense		(0.2)		—
Other expense, net		(0.2)		—
Total other expense, net		(0.4)		—
(Loss) income before equity in loss from unconsolidated joint ventures and income taxes	$	(0.9)	$	0.3

Three months ended ~~September 30, 2021~~March 31, 2022 compared to the three months ended ~~September 30, 2020~~March 31, 2021

The following table sets forth details of our hospitality segment consolidated revenue and cost of revenue:


	Three Months Ended September 30, 2021						Three Months Ended September 30, 2020						Three Months Ended March 31, 2022						Three Months Ended March 31, 2021
			Gross		Gross				Gross		Gross				Gross		Gross					Gross		Gross
	Revenue		Profit		Margin		Revenue		Profit		Margin		Revenue		Profit (Deficit)		Margin		Revenue			Profit		Margin

	In millions												In millions
Clubs	$	8.2	$	2.0	24.4	%	$	6.8	$	3.0	44.1	%	$	8.8	$	2.4	27.3	%	$	6.3		$	1.5	23.8	%
Hotel operations, food and beverage operations, short-term vacation rentals and other management services		12.3		3.1	25.2	%		9.3		2.8	30.1	%		6.3		(0.7)	(11.1)	%		5.3	��		0.1	1.9	%
Other		1.5		0.5	33.3	%		0.7		0.2	28.6	%		1.1		(0.2)	(18.2)	%		1.4			0.1	7.1	%
Total	$	22.0	$	5.6	25.5	%	$	16.8	$	6.0	35.7	%	$	16.2	$	1.5	9.3	%	$	13.0		$	1.7	13.1	%

Revenue from our clubs increased ~~$1.4~~$2.5 million, or ~~20.6%~~39.7%, during the three months ended ~~September 30, 2021,~~March 31, 2022 compared to the same period in ~~2020.~~2021. The increase in revenue in the current period was due to increases in the number of members and membership ~~revenue,~~revenue. As of March 31, 2022, Watersound Club had 2,271 members, compared with 1,722 members as ~~well as higher demand for club amenities that resulted in revenue increases from the beach club, golf and charter flights.~~of March 31, 2021, an increase of 549 members. Our clubs gross margin ~~decreased~~increased to ~~24.4%~~27.3% during the three months ended ~~September 30, 2021,~~March 31, 2022, compared to ~~44.1%~~23.8% during the same period in ~~2020.~~2021. The ~~decrease~~increase in gross margin in the current period was due ~~to increased support services allocation and sales incentive costs related~~ to the growth of ~~our club memberships, as well as~~membership and an increase ~~in cost~~ of ~~labor and products related to~~full-time members utilizing the ~~re-opening~~available activities of ~~club outlets closed during~~ the ~~third quarter of 2020 due to COVID-19.~~Watersound Club.

Revenue from our hotel operations, food and beverage operations, short-term vacation rentals and other management services increased ~~$3.0~~$1.0 million, or ~~32.3%~~18.9%, during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to the same period in ~~2020.~~2021. The increase iswas primarily due to ~~increases~~an increase in lodging revenue from the Hilton Garden Inn Panama City Airport, which opened in July ~~2021 and the WaterColor Inn, as well as food and beverage operations consistent with increased popularity of the region.~~2021. The three months ended ~~September 30, 2021,~~March 31, 2022 had a negative gross margin of ~~25.2%~~11.1%, compared to ~~30.1%~~1.9% during the same period in ~~2020.~~ 2021. The decrease in gross margin iswas due to pre-opening expenses associated with ~~the opening of~~Homewood Suites by Hilton ~~Garden Inn~~ Panama City ~~Airport,~~Beach, which opened March 2022, onboarding of staff for future assets currently under construction and an increase in cost of labor and products. The gross margin in the current period was also impacted by construction at the WaterColor Inn, which resulted in several outlets and guest rooms being out of service. The construction is expected to be completed in the summer of 2022, resulting in seven new guest suites, a resort pool and a new dining option..

Table of Contents

Revenue from other hospitality operations ~~increased $0.8~~decreased $0.3 million, or 21.4%, during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to the same period in ~~2020.~~2021. The ~~increase~~decrease in other hospitality revenue was primarily related to ~~an increase in revenue from~~stabilization of The Powder Room ~~which opened~~revenue, after the grand opening in ~~December 2020, as well as~~ the ~~WaterColor retail store~~first quarter of 2021. ~~Other~~Our other hospitality operations had a negative gross margin ~~increased~~of 18.2% during the three months ended ~~September 30, 2021, to 33.3%, as~~March 31, 2022, compared to ~~28.6%~~7.1% during the same period in ~~2020,~~2021, primarily due to ~~$0.2 million of business interruption proceeds received~~increased cost and shortages in ~~the current period for the marinas related to Hurricane Michael.~~firearms and ammunition availability. We did not have revenue from our marinas during the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ due to the impact of Hurricane Michael on the marinas. See Note 7. Hurricane Michael for additional information.

~~Our hospitality segment had a gross margin of 25.5% during the three months ended September 30, 2021, as compared to 35.7% during the same period in 2020.~~ ~~The decrease in gross margin is due to~~ ~~increased sales incentive costs related to the growth of our club memberships~~, pre-opening expenses associated with the opening of Hilton Garden Inn Panama City Airport, onboarding of staff for future assets currently under construction and an increase in cost of labor and products.

~~Other operating expenses include salaries and benefits, professional fees and other administrative expenses.~~

The increase of $0.5 million in depreciation and amortization expense during the three months ended September 30, 2021, as compared to the same period in 2020, was primarily due to new properties placed in service.

~~Table of Contents~~

~~Interest expense primarily includes interest incurred from our hospitality project financing.~~

~~Nine months ended September 30, 2021 compared to the nine months ended September 30, 2020~~

~~The following table sets forth details of our hospitality segment revenue and cost of revenue:~~

Nine Months Ended September 30, 2021

Nine Months Ended September 30, 2020

Gross

Gross

Gross

Gross

Revenue

Profit

Margin

Revenue

Profit

Margin

In millions
Clubs

$
23.1

$
6.5

28.1
%

$
16.0

$
6.3

39.4
%
Hotel operations, food and beverage operations, short-term vacation rentals and other management services

29.9

6.7

22.4
%

17.5

2.1

12.0
%
Other

4.4

1.3

29.5
%

1.3

0.3

23.1
%
Total

$
57.4

$
14.5

25.3
%

$
34.8

$
8.7

25.0
%

Revenue from our clubs increased $7.1 million, or 44.4%, during the nine months ended September 30, 2021 compared to the same period in 2020. The increase in revenue in the current period was due to increases in the number of members and membership revenue, as well as higher demand for club amenities that resulted in revenue increases from the beach club, golf and charter flights. As of September 30, 2021, Watersound Club had 2,158 members, compared with 1,448 members as of September 30, 2020 an increase of 710 members. Our clubs gross margin decreased to 28.1% during the nine months ended September 30, 2021, compared to 39.4% during the same period in 2020. The decrease in gross margin was due to increased support services allocation and sales incentive costs related to the growth of our club memberships, as well as an increase in cost of labor and products related to the re-opening of club outlets closed during 2020 due to COVID-19.

Revenue from our hotel operations, food and beverage operations, short-term vacation rentals and other management services increased $12.4 million, or 70.9%, during the nine months ended September 30, 2021, as compared to the same period in 2020. The increase is primarily due to increases in lodging revenue from the WaterColor Inn and Hilton Garden Inn Panama City Airport, which opened in July 2021, as well as food and beverage operations consistent with increased popularity of the region and year-round travel. The increase was also due to the impact of the COVID-19 pandemic on the prior period, which resulted in shutdowns and reduced revenue from mid-March to mid-May 2020. The nine months ended September 30, 2021 had a gross margin of 22.4%, compared to 12.0% during the same period in 2020. ~~The increase in gross margin is due to an increase in year-round travel in the current period consistent with the growth and popularity of the region~~. The increase in gross margin was partially offset by pre-opening expenses associated with the opening of Hilton Garden Inn Panama City Airport, onboarding of staff for future assets currently under construction and an increase in cost of labor and products.

Revenue from other hospitality operations increased $3.1 million during the nine months ended September 30, 2021, as compared to the same period in 2020. The increase in other hospitality revenue was ~~primarily related to an increase in revenue from The Powder Room, which opened in December 2020, as well as the WaterColor retail store~~. Our other hospitality operations gross margin increased to 29.5% during the nine months ended September 30, 2021, compared to 23.1% during the same period in 2020, due to $0.6 million of business interruption proceeds received in the current period for the marinas related to Hurricane Michael. We did not have revenue from our marinas during the nine months ended September 30, 2021 and 2020, due to the impact of Hurricane Michael on the marinas. See Note 7. ~~Hurricane Michael~~ ~~for additional information.~~

~~Our hospitality segment gross margin of 25.0% during the nine months ended September 30, 2021, was comparable to the gross margin of 24.7% during the same period in 2020.~~

Other operating expenses include salaries and benefits, professional fees, property taxes ~~CDD assessments~~ and other administrative expenses.

~~Table of Contents~~

The increase of ~~$0.9~~$0.4 million in depreciation, depletion and amortization expense during the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to the same period in ~~2020,~~2021, was primarily due to new properties placed in service.

Interest expense primarily includes interest incurred from our hospitality project financing.

Commercial

The table below sets forth the consolidated results of operations of our commercial segment:


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended March 31,
		2021		2020		2021		2020		2022		2021

		In millions								In millions
Revenue:
Leasing revenue
Commercial leasing revenue		$	4.1	$	3.9	$	11.6	$	11.2	$	4.6	$	3.8
Apartment leasing revenue			2.3		1.0		6.0		2.9
Multi-family leasing revenue											3.0		1.6
Senior living leasing revenue			0.6		—		1.2		—		1.0		0.2
Total leasing revenue			7.0		4.9		18.8		14.1		8.6		5.6
Commercial and rural real estate revenue			1.6		2.2		9.8		7.2		3.6		—
Timber revenue			1.0		1.6		4.8		5.5		3.0		1.6
Total revenue			9.6		8.7		33.4		26.8		15.2		7.2
Expenses:	Expenses:
Cost of leasing revenue			2.9		2.0		8.1		4.0		3.5		2.7
Cost of commercial and rural real estate revenue			0.2		0.8		1.8		2.2		1.1		—
Cost of timber revenue			0.1		0.2		0.5		0.6		0.2		0.1
Other operating expenses			1.1		1.0		3.0		2.7		1.1		0.9
Depreciation, amortization and depletion			2.8		1.8		7.6		5.1
Depreciation, depletion and amortization											3.0		2.3
Total expenses			7.1		5.8		21.0		14.6		8.9		6.0
Operating income			2.5		2.9		12.4		12.2		6.3		1.2
Other (expense) income:
Interest expense			(1.6)		(0.9)		(4.2)		(2.8)		(1.6)		(1.2)
Gain on contribution to equity method investment			—		—		3.1		3.9
Other income, net			3.6		—		3.6		0.1
Total other income (expense), net			2.0		(0.9)		2.5		1.2
Income before equity in loss from unconsolidated affiliates and income taxes		$	4.5	$	2.0	$	14.9	$	13.4
Gain on contributions to unconsolidated joint ventures											0.4		—
Other expense, net											(0.3)		—
Total other expense, net											(1.5)		(1.2)
Income before equity in loss from unconsolidated joint ventures and income taxes										$	4.8	$	—

Table of Contents

Three months ended ~~September 30, 2021~~March 31, 2022 compared to the three months ended ~~September 30, 2020~~March 31, 2021

The following table sets forth details of our commercial segment consolidated revenue and cost of revenue:


	Three Months Ended September 30, 2021						Three Months Ended September 30, 2020						Three Months Ended March 31, 2022						Three Months Ended March 31, 2021
			Gross		Gross				Gross		Gross				Gross		Gross				Gross		Gross
	Revenue		Profit (Deficit)		Margin		Revenue		Profit		Margin		Revenue		Profit		Margin		Revenue		Profit (Deficit)		Margin

	In millions												In millions
Leasing
Commercial leasing	$	4.1	$	2.9	70.7	%	$	3.9	$	2.4	61.5	%	$	4.6	$	3.1	67.4	%	$	3.8	$	2.5	65.8	%
Apartments leasing		2.3		1.4	60.9	%		1.0		0.5	50.0	%
Multi-family leasing														3.0		2.0	66.7	%		1.6		1.0	62.5	%
Senior living leasing		0.6		(0.2)	(33.3)	%		—		—	—	%		1.0		—	—	%		0.2		(0.6)	(300.0)	%
Total leasing		7.0		4.1	58.6	%		4.9		2.9	59.2	%		8.6		5.1	59.3	%		5.6		2.9	51.8	%
Commercial and rural real estate		1.6		1.4	87.5	%		2.2		1.4	63.6	%		3.6		2.5	69.4	%		—		—	—	%
Timber		1.0		0.9	90.0	%		1.6		1.4	87.5	%		3.0		2.8	93.3	%		1.6		1.5	93.8	%
Total	$	9.6	$	6.4	66.7	%	$	8.7	$	5.7	65.5	%	$	15.2	$	10.4	68.4	%	$	7.2	$	4.4	61.1	%

~~Table of Contents~~

Total leasing revenue increased ~~$2.1~~$3.0 million, or ~~42.9%~~53.6%, during the three months ended ~~September 30, 2021,~~March 31, 2022, as compared to the same period in ~~2020.~~2021. The increase iswas primarily due to ~~new leases at Pier Park Crossings Phase II apartments, which began leasing in the fourth quarter of 2020 and~~ new leases at Watersound Origins Crossings apartments and Watercrest senior living community, ~~which began~~as well as other new leases. Total leasing ~~in the first quarter of 2021. Leasing~~ gross margin ~~decreased~~increased during the three months ended ~~September 30, 2021,~~March 31, 2022 to ~~58.6%~~59.3%, as compared to ~~59.2%~~51.8% during the same period in ~~2020,~~2021, primarily due to start-up and lease-up expenses for new assets in the ~~current period.~~

During the three months ended September 30, 2021, we had five commercial and rural real estate sales of approximately 423 acres for $1.6 million, resulting in a gross profit margin of approximately 87.5%. During the three months ended September 30, 2020, we had seven commercial and rural real estate sales totaling approximately 232 acres for $2.2 million, resulting in a gross profit margin of approximately 63.6%.

Timber revenue decreased $0.6 million, or 37.5%, to $1.0 million during the three months ended September 30, 2021, as compared to $1.6 million during the same period in 2020. The decrease is primarily due to a decrease in the amount of wood product tons sold, which were partially offset by price increases in the current period, as well as a decrease in the sales of fill dirt and other products. There were 50,000 tons of wood products sold during the three months ended September 30, 2021, as compared to 84,000 tons of wood products sold during the same period in 2020. The average price of wood product sold increased to $17.32 per ton during the three months ended September 30, 2021, as compared to $14.99 per ton during the same period in 2020.

~~Other operating expenses include salaries and benefits, property taxes, CDD assessments, professional fees, marketing, project administration and other administrative expenses.~~

The increase of $1.0 million in depreciation, amortization and depletion expense during the three months ended September 30, 2021, as compared to the same period in 2020, was primarily due to new properties placed in service.

~~Interest expense primarily includes interest incurred from our commercial project financing and CDD debt.~~

Other income, net during the three months ended September 30, 2021, includes $3.6 million received from the Florida Division of Emergency Management’s TRBG program for recovery of lost income related to timber crop that was destroyed as a result of Hurricane Michael. See Note 7. ~~Hurricane Michael~~ ~~and Note 16.~~ ~~Other Income (Expense), Net~~ ~~for additional information.~~

~~Nine months ended September 30, 2021 compared to the nine months ended September 30, 2020~~

~~The following table sets forth details of our commercial segment revenue and cost of revenue:~~

Nine Months Ended September 30, 2021

Nine Months Ended September 30, 2020

Gross

Gross

Gross

Gross

Revenue

Profit (Deficit)

Margin

Revenue

Profit

Margin

In millions
Leasing

Commercial leasing

$
11.6

$
7.9

68.1
%

$
11.2

$
7.5

67.0
%
Apartments leasing

6.0

3.9

65.0
%

2.9

2.6

89.7
%
Senior living leasing

1.2

(1.1)

(91.7)
%

—

—

—
%
Total leasing

18.8

10.7

56.9
%

14.1

10.1

71.6
%
Commercial and rural real estate

9.8

8.0

81.6
%

7.2

5.0

69.4
%
Timber

4.8

4.3

89.6
%

5.5

4.9

89.1
%
Total

$
33.4

$
23.0

68.9
%

$
26.8

$
20.0

74.6
%

Total leasing revenue increased $4.7 million, or 33.3%, during the nine months ended September 30, 2021, as compared to the same period in 2020. The increase is primarily due to new leases at Pier Park Crossings Phase II apartments, which began leasing in the fourth quarter of 2020 and new leases at Watersound Origins Crossings apartments and Watercrest senior living community, which began leasing in the first quarter of 2021, as well as other

~~Table of Contents~~

new leases. Leasing gross margin decreased during the nine months ended September 30, 2021 to 56.9%, as compared to 71.6% during the same period in 2020, primarily due to $0.7 million of business interruption proceeds received for Pier Park Crossings apartments related to Hurricane Michael in the prior ~~period and start-up and lease-up expenses for new assets in the current~~ period. As of ~~September 30,~~March 31, 2022, we had net rentable square feet of approximately 981,000, of which approximately 883,000 square feet was under lease. As of March 31, 2021, we had net rentable square feet of approximately ~~986,000,~~907,000, of which approximately ~~821,000~~780,000 square feet was under lease. As of ~~September 30, 2020,~~March 31, 2022, we had ~~net rentable square feet~~910 multi-family and senior living units leased, compared to 421 multi-family and senior living units leased as of ~~approximately 904,000, of which approximately 758,000 square feet was under lease.~~March 31, 2021.

~~The~~We believe the diversity of our commercial segment complements the growth of our residential and hospitality segments. Commercial and rural real estate revenue can vary depending on the proximity to developed areas and the mix and characteristics of commercial and rural real estate sold in each period, with varying compositions of retail, office, industrial and other commercial uses. During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, we had ~~thirteen~~six commercial and rural real estate sales of approximately ~~536~~13 acres for ~~$9.8~~$3.3 million and land improvement services of $0.3 million, together resulting in a gross ~~profit~~ margin of approximately ~~81.6%~~69.4%. During the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, we had ~~nineteen~~one commercial and rural real estate ~~sales~~sale totaling approximately ~~433 acres~~one acre for $7.2 million, resulting in a gross profit margin of approximately 69.4%. Commercial and rural real estate revenue for the nine months ended September 30, 2020, included $1.8 million related to the sale of the SouthWood Town Center.less than $0.1 million. As our focus continues to evolve more towards recurring revenue from leasing operations, we expect to have limited commercial and rural real estate sales. Further, we may continue to transform and operate commercial properties for higher and better use. This may result in certain assets moving from the commercial segment to the hospitality segment.

Timber revenue ~~decreased $0.7~~increased $1.4 million, or ~~12.7%~~87.5%, to ~~$4.8~~$3.0 million during the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$5.5~~$1.6 million during the same period in ~~2020.~~2021. The ~~decrease~~increase is primarily due to ~~a decrease~~an increase in the ~~sales~~tons of ~~fill dirt~~wood products sold, along with price increases and ~~other products. The decrease was partially offset by an increase due to the~~ sales mix of different wood products ~~and price increases~~ in the current period. There were ~~223,000~~107,000 tons of wood products sold during the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~275,000~~76,000 tons of wood products sold during the same period in ~~2020.~~2021. The average price of wood product sold increased to ~~$19.28~~$26.63 per ton during the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$15.35~~$18.94 per ton during the same period in ~~2020.~~2021.

Table of Contents

The total tons sold and relative percentage of total tons sold by major type of wood product are as follows:


	Three Months Ended March 31,
	2022			2021
Pine pulpwood	56,000	52.3	%	41,000	54.0	%
Pine sawtimber	48,000	44.9	%	31,000	40.8	%
Pine grade logs	2,000	1.9	%	3,000	3.9	%
Other	1,000	0.9	%	1,000	1.3	%
Total	107,000	100.0	%	76,000	100.0	%

Other operating expenses include salaries and benefits, property taxes, CDD assessments, professional fees, marketing, project administration and other administrative expenses.

The increase of ~~$2.5~~$0.7 million in depreciation, ~~amortization~~depletion and ~~depletion~~amortization expense during the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to the same period in ~~2020,~~2021, was primarily due to new properties placed in service.

Interest expense primarily includes interest incurred from our commercial project financing and CDD debt.

Gain on ~~contribution~~contributions to ~~equity method investment~~unconsolidated joint ventures for the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, includes a gain of ~~$3.1~~$0.4 million on land contributed to our unconsolidated Electric Cart Watersound Fountains Independent Living JV. Gain on contribution to equity method investment for the nine months ended September 30, 2020, includes a gain of $3.9 million on land contributed to our unconsolidated Sea Sound Apartments JV. See Note 4. Joint Ventures for additional information.

Other income, net during the nine months ended September 30, 2021, includes $3.6 million received from the Florida Division of Emergency Management’s TRBG program for recovery of lost income related to timber crop that was destroyed as a result of Hurricane Michael. See Note 7. ~~Hurricane Michael~~ ~~and Note 16.~~ ~~Other Income (Expense), Net~~ ~~for additional information.~~

~~Table of Contents~~

~~The total net rentable square feet and percentage leased of leasing properties by location are as follows:~~

September 30, 2021

December 31, 2020




Net




Net


Rentable

Rentable

Square

Percentage

Square

Percentage

Location

Feet*

Leased

Feet*

Leased

Pier Park North JV

Bay County, FL

320,310

95
%

320,310

92
%
VentureCrossings

Bay County, FL

303,605

88
%

303,605

86
%
Beckrich Office Park^{(a) (b)}

Bay County, FL

81,065

84
%

86,296

80
%
Watersound Self-Storage^(c)

Walton County, FL

67,694

12
%

N/A

N/A
%
WindMark Beach Town Center^{(a) (d)}

Gulf County, FL

44,496

49
%

44,748

47
%
Watersound Town Center^(e)

Walton County, FL

24,764

100
%

6,496

100
%
WaterColor Town Center^(a)

Walton County, FL

22,199

100
%

23,121

79
%
Cedar Grove Commerce Park

Bay County, FL

19,389

90
%

19,449

90
%
Port St. Joe Commercial

Gulf County, FL

16,964

100
%

16,964

100
%
Beach Commerce Park^(a)

Bay County, FL

16,450

100
%

17,450

76
%
SummerCamp Commercial

Franklin County, FL

13,000

0
%

13,000

0
%
South Walton Commerce Park^(f)

Walton County, FL

11,570

88
%

11,570

88
%
WaterSound Gatehouse^(a)

Walton County, FL

10,271

100
%

10,271

87
%
WaterColor Crossings

Walton County, FL

7,135

100
%

7,135

100
%
395 Office building

Walton County, FL

6,700

100
%

6,700

100
%
Pier Park outparcel

Bay County, FL

5,565

100
%

5,565

100
%
Topsail West Commercial

Walton County, FL

3,500

100
%

3,500

100
%
Bank building

Bay County, FL

3,346

100
%

3,346

100
%
Bank building

Gulf County, FL

3,346

100
%

3,346

100
%
WaterColor HOA Office

Walton County, FL

2,520

100
%

2,520

100
%
RiverCamps

Bay County, FL

2,112

100
%

2,112

100
%



986,001

83
%

907,504

85
%

*	Net Rentable Square Feet is designated as the current square feet available for lease as specified in the applicable lease agreements plus management’s estimate of space available for lease based on construction drawings.

~~(a)~~

~~In addition to net rentable square feet there is also space that we occupy or that serves as common area.~~

~~(b)~~

~~Included in net rentable square feet as of September 30, 2021 and December 31, 2020, is 1,500 square feet leased to a consolidated JV.~~

~~(c)~~

~~Construction was completed in the third quarter of 2021.~~

~~(d)~~

~~Included in net rentable square feet as of September 30, 2021 and December 31, 2020, is 13,808 square feet of unfinished space.~~

~~(e)~~

~~Construction of an 18,268 square foot building was completed in the third quarter of 2021.~~

~~(f)~~

~~Included in net rentable square feet as of September 30, 2021 and December 31, 2020, is 1,364 square feet leased to a consolidated JV.~~

~~Total units and percentage leased/occupied for apartments and senior living communities by location are as follows:~~

September 30, 2021

December 31, 2020

Percentage

Percentage

Leased

Leased




Units

Units

Units

of Units

Units

Units

of Units

Location

Planned

Completed

Leased

Completed

Completed

Leased

Completed
Apartments

Pier Park Crossings

Bay County, FL

240

240

238

99%

240

237

99%
Pier Park Crossings Phase II

Bay County, FL

120

120

120

100%

120

55

46%
Watersound Origins Crossings^(a)

Walton County, FL

217

158

151

96%

18

—

0%
Sea Sound^(b)

Bay County, FL

300

82

81

99%

—

—

N/A
North Bay Landing^(c)

Bay County, FL

240

—

—

N/A

—

—

N/A
Total apartment units

1,117

600

590

98%

378

292

77%
Senior living communities

Watercrest^(d)

Walton County, FL

107

107

36

34%

107

—

N/A
Watersound Fountains^(e)

Walton County, FL

148

—

—

N/A

—

—

N/A
Total senior living units

255

107

36

34%

107

—

N/A
Total units

1,372

707

626

89%

485

292

60%

~~(a)~~

~~Construction of the initial twelve apartment buildings was completed as of the end of the third quarter of 2021.~~

~~Table of Contents~~

~~(b)~~

Construction of the initial apartment building was completed as of the end of the third quarter of 2021. The Sea Sound Apartments JV is unconsolidated and is accounted for under the equity method of accounting.

~~(c)~~

~~Construction began in the fourth quarter of 2020 and is ongoing.~~

~~(d)~~

~~Construction was completed in the fourth quarter of 2020.~~

~~(e)~~

~~Construction began in the second quarter of 2021 and is ongoing. The Watersound Fountains Independent Living JV is unconsolidated and is accounted for under the equity method of accounting.~~

~~The total tons sold and relative percentage of total tons sold by major type of wood product are as follows:~~

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020


2021

2020

Pine pulpwood

33,000

66.0
%
65,000

77.4
%

124,000

55.6
%
170,000

61.8
%

Pine sawtimber

16,000

32.0
%
14,000

16.7
%

89,000

39.9
%
67,000

24.4
%

Pine grade logs

1,000

2.0
%
5,000

5.9
%

8,000

3.6
%
25,000

9.1
%

Other

—

—
%
—

—
%

2,000

0.9
%
13,000

4.7
%

Total

50,000

100.0
%
84,000

100.0
%

223,000

100.0
%
275,000

100.0
%

Liquidity and Capital Resources

As of ~~September 30, 2021,~~March 31, 2022, we had cash and cash equivalents ~~of $27.3 million, compared to $106.8 million as of December 31, 2020. During 2021, we transitioned our short-term U.S. Treasury Bills classified as cash equivalents to~~and U.S. Treasury Bills classified as investments – debt ~~securities. Our cash and cash equivalents~~securities of $151.3 million, compared to $159.1 million as of ~~September 30, 2021 includes $9.4 million~~December 31, 2021. As of ~~U. S. Treasury Money Market Funds.~~March 31, 2022, we also had investments - equity securities in preferred stock investments of $0.5 million. In addition to cash and cash equivalents, we consider our investments classified as available-for-sale securities and equity securities (“Securities”), as being generally available to meet our liquidity needs. Securities are not as liquid as cash and cash equivalents, but they are generally convertible into cash within a relatively short period of time. ~~As of September 30, 2021, we had investments - debt securities in U. S. Treasury Bills of $103.0 million and investments - equity securities in preferred stock investments of $0.4 million.~~ See Note 5. Investments for additional information regarding our investments.

We believe that our current cash position, financing arrangements and cash generated from operations will provide us with sufficient liquidity to satisfy our anticipated working capital needs, expected capital expenditures, principal and interest payments on our long-term debt, capital contributions to JVs, Latitude ~~Margaritaville Watersound~~ JV Note commitment, authorized stock repurchases and authorized dividends for the next twelve months.

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, we incurred a total of ~~$140.6~~$79.0 million for capital expenditures, which includes ~~$34.7~~$25.9 million for our residential segment, ~~$34.7~~$25.8 million for our commercial segment, ~~$70.9~~$27.2 million for our hospitality segment and ~~$0.3~~$0.1 million for corporate expenditures. As of ~~September 30, 2021,~~March 31, 2022, we had a total of ~~$260.1~~$220.1 million in construction and development related contractual obligations, of which a portion will be funded through committed or new financing arrangements.

As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, we had various loans outstanding totaling ~~$198.9~~$262.1 million and ~~$161.4~~$227.5 million, respectively, with maturities from May ~~2023~~2022 through ~~June 2060.~~March 2064. The weighted average rate on our variable rate loans as of ~~September 30, 2021~~March 31, 2022 was ~~2.5%~~2.9%. See Item 3. Quantitative and Qualitative Disclosures about Market Risk for additional information regarding LIBOR related risks. See Note 10. Debt, Net for additional information.

In October 2015, the Pier Park North JV entered into a $48.2 million loan. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, $43.8~~2021, $43.3 million and ~~$44.6~~$43.6 million, respectively, was outstanding on the PPN JV Loan. The PPN JV Loan accrues interest at a rate of 4.1% per annum and matures in November 2025. In connection with the PPN JV Loan, we entered into a limited guarantee in favor of the lender, based on our percentage ownership of the JV. In addition, the guarantee can become full recourse in the case of any fraud or intentional misrepresentation by the Pier Park North JV; any voluntary transfer or encumbrance of the property in violation of the due-on-sale clause in the security instrument;

Table of Contents

upon commencement of voluntary bankruptcy or insolvency proceedings and upon breach of covenants in the security instrument. See Note 10. Debt, Net for additional information.

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In May 2018, the Pier Park Crossings JV entered into a $36.6 million loan, insured by HUD, to finance the construction of apartments in Panama City Beach, Florida. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, $35.8~~2021, $35.6 million and ~~$36.1~~$35.7 million, respectively, was outstanding on the PPC JV Loan. ~~In August 2021, the Pier Park Crossings JV entered into a modification of the~~The PPC JV Loan ~~that reduced the~~bears interest at a rate ~~from 4.0% to~~of 3.1%. and matures in June 2060. The ~~modification revised the prepayment provision to include that the~~ PPC JV Loan may not be prepaid prior to September 1, 2022 and if any additional principal is prepaid from September 1, 2022 through August 31, 2031 a premium is due to the lender of 2% - 10% ~~of any prepaid principal.~~. The PPC JV Loan is secured by the Pier Park Crossings JV’s real property and the assignment of rents and leases. See Note 10. Debt, Net for additional information.

In May 2019, the Watersound Origins Crossings JV entered into a $37.9 million loan. In January 2022, the Watersound Origins Crossings JV entered into a modification that increased the principal amount of the loan to $44.0 million, modified the interest rate from 5.0% to SOFR plus 2.8%, with a floor of 3.3% and provides for payments of interest only with a final balloon payment at maturity in May 2024. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, $36.3~~2021, $44.0 million and ~~$27.2~~$37.9 million, respectively, was outstanding on the Watersound Origins Crossings JV Loan. ~~The Watersound Origins Crossings JV Loan bears interest at a rate of 5.0% and matures in May 2024.~~ The Watersound Origins Crossings JV Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Watersound Origins Crossings JV Loan, we executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Watersound Origins Crossings JV Loan. As guarantor, we may request a reduction of our liability under the Watersound Origins Crossings JV Loan to either 50% or 25% of the outstanding principal amount based on meeting certain debt service coverage and loan to value requirements. In addition, the guarantee can become full recourse in the case of any fraud or intentional misrepresentation or failure to abide by other certain obligations on the part of such guarantor. We are the sole guarantor and receive a monthly fee related to the guarantee from our JV partner based on the JV partner’s ownership percentage. See Note 10. Debt, Net for additional information.

In June 2019, the Watercrest JV entered into a $22.5 million loan. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, $19.6~~2021, $20.3 million and ~~$18.1~~$20.1 million, respectively, was outstanding on the Watercrest JV Loan. The Watercrest JV Loan bears interest at a rate of LIBOR plus 2.2% and matures in June 2047. The Watercrest JV Loan is secured by the real property, assignment of rents, leases and deposits and the security interest in the rents and personal property. In connection with the Watercrest JV Loan, we executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Watercrest JV Loan. We are the sole guarantor and receive a quarterly fee related to the guarantee from our JV partner based on the JV partner’s ownership percentage. The Watercrest JV entered into an interest rate swap to hedge cash flows tied to changes in the underlying floating interest rate tied to LIBOR. The interest rate swap was effective June 1, 2021 and matures on June 1, 2024 and fixed the variable rate on the notional amount of related debt of $20.0 million to a rate of 4.4%. See Note 6. Financial Instruments and Fair Value Measurements and Note 10. Debt, Net for additional information.

In August 2019, a wholly-owned subsidiary of ours entered into a $5.5 million loan. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, $5.2~~2021, $5.1 million and ~~$5.4~~$5.2 million, respectively, was outstanding on the Beckrich Building III Loan. The Beckrich Building III Loan bears interest at a rate of LIBOR plus 1.7% and matures in August 2029. The Beckrich Building III Loan is secured by the real property, assignment of leases, rents and profits and the security interest in the rents and personal property. In connection with the Beckrich Building III Loan, we executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Beckrich Building III Loan. See Note 10. Debt, Net for additional information.

In October 2019, the Pier Park Crossings Phase II JV entered into a $17.5 million loan. As of ~~September 30,~~March 31, 2022 and December 31, 2021, ~~$17.4~~$17.3 million and ~~$15.9~~$17.4 million, respectively, was outstanding on the PPC II JV Loan. The PPC II JV Loan matures in October 2024 and bears interest at a rate of LIBOR plus 2.1%. The PPC II JV Loan is secured by the real property, assignment of rents and leases and the security interest in the rents, leases and personal property. In connection with the PPC II JV Loan, we executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the PPC II JV Loan. As guarantor, our liability under the PPC II JV Loan ~~was reduced to~~is 50% of the outstanding principal amount ~~upon satisfaction of final advance conditions in April 2021~~ and will be reduced to 25% of the outstanding principal amount upon reaching and maintaining a certain debt service coverage ratio. We are the sole guarantor and receive a monthly fee related to the guarantee from our JV partner based on the JV partner’s ownership percentage. See Note 10. Debt, Net for additional

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information. The Pier Park Crossings Phase II JV is in the process of refinancing the PPC II JV Loan, which will be a HUD insured loan.

In March 2020, a wholly-owned subsidiary of ours entered into a $15.3 million loan. As of ~~September 30, 2021~~both March 31, 2022 and December 31, ~~2020,~~2021, $14.6 million ~~and $3.5 million, respectively,~~ was outstanding on the Airport Hotel Loan. The Airport Hotel Loan bears interest at LIBOR plus 2.0%, with a floor of 3.0%, and matures in March 2025. The Airport Hotel Loan is secured by the real property, assignment of leases, rents and profits and the security interest in the rents and personal property. In connection with the Airport Hotel Loan, we executed a guarantee in favor of the lender to

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guarantee the payment and performance of the borrower under the Airport Hotel Loan. See Note 10. Debt, Net for additional information.

In April 2020, the Pier Park Resort Hotel JV entered into a loan with an initial amount of $52.5 million and up to a maximum of $60.0 million through additional earn-out requests. As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020, there~~2021, $20.1 million and $14.7 million, respectively, was ~~no principal balance~~ outstanding on the Pier Park Resort Hotel JV Loan. The Pier Park Resort Hotel JV Loan matures in April 2027 and bears interest at a rate of LIBOR plus 2.2% during construction and LIBOR plus 2.0% upon hotel opening. The Pier Park Resort Hotel JV Loan is secured by the real property, assignment of rents and leases and the security interest in the rents, leases and personal property. In connection with the Pier Park Resort Hotel JV Loan, as ~~guarantor,~~guarantors, we and our JV partner entered into a guarantee based on each partner’s ownership interest in favor of the lender, to guarantee the payment and performance of the borrower. As guarantor, our liability under the Pier Park Resort Hotel JV Loan will be released upon reaching and maintaining certain debt service coverage for twelve months. In addition, the guarantee can become full recourse in the case of the failure of ~~guarantor~~the guarantors to abide by or perform any of the covenants or warranties to be performed on the part of such guarantor. The Pier Park Resort Hotel JV entered into an interest rate swap to hedge cash flows tied to changes in the underlying floating interest rate tied to LIBOR. The interest rate swap is effective December 10, 2022 and matures on April 12, 2027 and fixed the variable rate on the notional amount of related debt of $42.0 million to a rate of 3.2%. See Note 6. Financial Instruments and Fair Value Measurements and Note 10. Debt, Net for additional information.

In November 2020, a wholly-owned subsidiary of ours entered into a $16.8 million ~~construction loan to finance the construction of a HomeWood Suites by Hilton hotel in the Breakfast Point area of Panama City Beach, Florida.~~loan. As of ~~September 30, 2021, $8.3 million was outstanding on the Breakfast Point Hotel Loan. As of~~March 31, 2022 and December 31, ~~2020, there~~2021, $13.7 million and $11.8 million, respectively, was ~~no principal balance~~ outstanding on the Breakfast Point Hotel Loan. The Breakfast Point Hotel Loan matures in November 2042 and bears interest at a rate of LIBOR plus 2.8% through November 2022, 3.3% over the 5-Year T-Bill Index from November 2022 through November 2027 and 3.3% over the 1-Year T-Bill Index from November 2027 through November 2042, with a minimum rate of 3.8% throughout the term of the loan. The Breakfast Point Hotel Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Breakfast Point Hotel Loan, we executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Breakfast Point Hotel Loan. See Note 10. Debt, Net for additional information.

In November 2020, a wholly-owned subsidiary of ours entered into a $5.8 million ~~construction loan to finance the construction of a self-storage facility in Santa Rosa Beach, Florida.~~loan. As of ~~September 30, 2021, $4.1 million was outstanding on the Self-Storage Facility Loan. As of~~both March 31, 2022 and December 31, ~~2020, there~~2021, $4.7 million was ~~no principal balance~~ outstanding on the Self-Storage Facility Loan. The Self-Storage Facility Loan matures in November 2025 and bears ~~interest at a rate of LIBOR plus 2.5%, with a floor of 3.0%. Upon receipt of final lien waivers and certificate of occupancy, the Self-Storage Facility Loan will bear~~ interest at a rate of LIBOR plus 2.4%, with a floor of 2.9%. The Self-Storage Facility Loan is secured by the real property, assignment of leases and rents and the security interest in the rents and personal property. In connection with the Self-Storage Facility Loan, we executed a guarantee in favor of the lender to guarantee the payment and performance of the borrower under the Self-Storage Facility Loan. Our liability as guarantor under the Self-Storage Facility Loan shall not exceed $2.9 million, plus any additional fees, upon reaching and maintaining certain debt service coverage. See Note 10. Debt, Net for additional information.

In January 2021, The Lodge 30A JV entered into a $15.0 million ~~construction loan to finance the construction of a boutique hotel in Seagrove Beach, Florida.~~loan. As of ~~September 30,~~March 31, 2022 and December 31, 2021, ~~$4.5~~$10.3 million and $7.5 million, respectively, was outstanding on the Lodge 30A JV Hotel Loan. The Lodge 30A JV Hotel Loan bears interest at a rate of 3.8% and matures in January 2028. The Lodge 30A JV Hotel Loan is secured by the real property, assignment of leases and rents and the security interest in the rents and personal property. In connection with the Lodge 30A JV Hotel Loan, we, wholly-owned subsidiaries of ours and our JV partner entered into a joint and several payment and performance guarantee in favor of the lender. Upon reaching a certain debt service coverage ratio for a minimum of twenty-four months, our liability as guarantor will be reduced to 75% of the outstanding principal amount for a twelve-month period. The debt service coverage ratio will be tested annually thereafter and will be reduced to 50% in year four and 25% in year five. We receive a monthly fee related to the

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guarantee from our JV partner based on the JV partner’s ownership percentage. See Note 10. Debt, Net for additional information.

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In March 2021, a wholly-owned subsidiary of ours entered into a $26.8 million ~~construction loan to finance the construction of apartments in Panama City, Florida.~~loan. As of ~~September 30,~~March 31, 2022 and December 31, 2021, ~~there~~$5.1 million and $1.3 million, respectively, was ~~no principal balance~~ outstanding on the North Bay Landing Apartments Loan. The North Bay Landing Apartments Loan bears interest at a rate of LIBOR plus 2.5%, with a floor of 3.2%. Upon reaching a certain debt service coverage ratio, the North Bay Landing Apartments Loan will bear interest at a rate of LIBOR plus 2.3%, with a floor of 3.0%. The North Bay Landing Apartments Loan matures in September 2024 and includes an option for an extension of the maturity date by eighteen months, subject to certain conditions. The North Bay Landing Apartments Loan is secured by the real property, assignment of rents and leases and the security interest in the rents, leases and personal property. In connection with the North Bay Landing Apartments Loan, we executed a guarantee in favor of the lender to guarantee completion of the project and the payment and performance of the borrower under the North Bay Landing Apartments Loan. As guarantor, our liability under the North Bay Landing Apartments Loan will be reduced to 50% of the outstanding principal amount upon satisfaction of final advance conditions and reduced to 25% of the outstanding principal amount upon reaching and maintaining a certain debt service coverage ratio. In addition, the guarantee can become full recourse in the case of any fraud or intentional misrepresentation or failure to abide by other certain obligations on the part of such guarantor. See Note 10. Debt, Net for additional information.

In June 2021, a wholly-owned subsidiary of ours entered into a $28.0 million ~~construction loan to finance the construction of the Camp Creek Inn and amenity center in Watersound, Florida.~~loan. As of ~~September 30,~~March 31, 2022 and December 31, 2021, ~~there~~$10.3 million and $3.4 million, respectively, was ~~no principal balance~~ outstanding on the Watersound Camp Creek ~~Inn~~ Loan. The Watersound Camp Creek ~~Inn~~ Loan bears interest at a rate of LIBOR plus 2.1%, with a floor of 2.6%, and matures in December 2047. The Watersound Camp Creek ~~Inn~~ Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Watersound Camp Creek ~~Inn~~ Loan, we executed a guarantee in favor of the lender to guarantee completion of the project and the payment of the borrower under the Watersound Camp Creek ~~Inn~~ Loan. As guarantor, our liability under the Watersound Camp Creek ~~Inn~~ Loan will be reduced to 50% of the outstanding principal amount upon the project reaching and maintaining a trailing six months of operations with a certain debt service coverage ratio and reduced to 25% of the outstanding principal amount upon reaching and maintaining a trailing twelve months of operations of a certain debt service coverage ratio. In addition, the guarantee can become full recourse in the case of the failure of guarantor to abide by or perform any of the covenants, warranties or other certain obligations to be performed on the part of such guarantor. See Note 10. Debt, Net for additional information.

In August 2021, a wholly-owned subsidiary of ours entered into a $12.0 million ~~construction loan to finance the construction of the Watersound Town Center in Watersound, Florida.~~loan. As of ~~September 30,~~March 31, 2022 and December 31, 2021, ~~there~~$4.5 million and $0.6 million, respectively, was ~~no principal balance~~ outstanding on the Watersound Town Center Grocery Loan. The Watersound Town Center Grocery Loan bears interest at LIBOR plus 2.0%, with a floor of 2.2%, and matures in August 2031. The Watersound Town Center Grocery Loan is secured by the real property, assignment of rents and the security interest in the rents and personal property. In connection with the Watersound Town Center Grocery Loan, we executed a guarantee in favor of the lender to guarantee completion of the project and the payment and performance of the borrower under the Watersound Town Center Grocery Loan. As guarantor, our liability under the Watersound Town Center Grocery Loan will be reduced to 50% of the outstanding principal amount upon satisfaction of final advance conditions, issuance of the certificate of occupancy for the project and receipt of the initial base rent payment and reduced to 25% of the outstanding principal amount upon reaching a certain debt service coverage ratio and the project maintaining 93% occupancy for ninety consecutive days. See Note 10. Debt, Net for additional information.

In October 2021, a wholly-owned subsidiary of ours entered into a $21.2 million loan. As of March 31, 2022 and December 31, 2021, there was no principal balance outstanding on the Hotel Indigo Loan. The Hotel Indigo Loan bears interest at a rate of LIBOR plus 2.6%, with a floor of 2.6%, through October 2023 and LIBOR plus 2.4%, with a floor of 2.4%, from November 2023 through maturity. The Hotel Indigo Loan matures in October 2028 and includes an option for an extension of the maturity date by sixty months, subject to certain conditions. The Hotel Indigo Loan is secured by the leasehold property, assignment of rents, leases, deposits, permits, plans, fees, agreements, approvals and contracts and the security interest in the personal property and rents. In connection with the Hotel Indigo Loan, we executed a guarantee in favor of the lender to guarantee completion of the project and the payment and performance of the borrower under the Hotel Indigo Loan. See Note 10. Debt, Net for additional information.

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In January 2022, the Mexico Beach Crossings JV entered into a $43.5 million loan, insured by HUD, to finance the construction of apartments in Mexico Beach, Florida. As of March 31, 2022, $4.2 million was outstanding on the Mexico Beach Crossings JV Loan. The Mexico Beach Crossings JV Loan bears interest at a rate of 3.0% and matures in March 2064. The Mexico Beach Crossings JV Loan may not be prepaid prior to April 1, 2024 and if any additional principal is prepaid from April 1, 2024 through March 31, 2034 a premium is due to the lender of 1% - 10%. The Mexico Beach Crossings JV Loan is secured by the Mexico Beach Crossings JV’s real property and the assignment of rents and leases. See Note 10. Debt, Net for additional information.

CDD bonds financed the construction of infrastructure improvements in some of our communities. The principal and interest payments on the bonds are paid by assessments on the properties benefited by the improvements financed by the bonds. We have recorded a liability for CDD debt that is associated with platted property, which is the point at which it becomes fixed and determinable. Additionally, we have recorded a liability for the balance of the CDD debt that is associated with unplatted property if it is probable and reasonably estimable that we will ultimately be responsible for repayment. We have recorded CDD related debt of ~~$5.0~~$4.9 million as of ~~September 30, 2021.~~March 31, 2022. Total outstanding CDD debt related to our land holdings was ~~$14.2~~$14.0 million as of ~~September 30, 2021,~~March 31, 2022, which was comprised of ~~$11.9~~$11.8 million at SouthWood, $2.2 million at the existing Pier Park retail center and less than $0.1 million at Wild Heron. We pay interest on this total outstanding CDD debt.

As of ~~September 30, 2021,~~March 31, 2022, our unconsolidated Watersound Fountains Independent Living JV, Sea Sound Apartments JV, Latitude Margaritaville Watersound JV, Pier Park TPS JV and Busy Bee JV had various loans

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outstanding, some of which we have entered into guarantees. See Note 4. Joint Ventures and Note ~~18.~~19. Commitments and Contingencies for additional information.

In June 2020, we, as lender, entered into a $10.0 million secured revolving promissory note with the unconsolidated Latitude Margaritaville Watersound JV, as borrower. As of ~~September 30, 2021 and~~March 31, 2022, there was no principal balance outstanding on the Latitude JV Note. As of December 31, ~~2020, $8.6~~2021, $7.1 million ~~and $2.7 million, respectively,~~ was outstanding on the Latitude ~~Margaritaville Watersound~~ JV Note. The Latitude ~~Margaritaville Watersound~~ JV Note was provided by us to finance the development of the pod-level, non-spine ~~infrastructure, which~~infrastructure. Future advances, if any, will be repaid by the JV as each home is sold by the JV, with the aggregate unpaid principal and all accrued and unpaid interest due at maturity in June 2025. The Latitude ~~Margaritaville Watersound~~ JV Note is secured by a mortgage and security interest in and on the real property and improvements located on the real property of the JV. See Note 4. Joint Ventures and Note 9. Other Assets for additional information.

During the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, we did not repurchase shares of our common stock outstanding. ~~During the nine months ended September 30, 2020, we repurchased a total of 532,034 shares of our common stock outstanding for an aggregate purchase price of $8.8 million including costs.~~ See Note ~~14.~~15. Stockholders’ Equity for additional information regarding ~~common stock repurchases related to~~ the Stock Repurchase Program.

As part of a timberland sale in 2007 and 2008, we have recorded a retained interest with respect to notes contributed to bankruptcy-remote qualified SPEs of ~~$13.5~~$14.1 million for the installment notes monetized through ~~September 30, 2021.~~March 31, 2022. This balance represents the present value of future cash flows to be received over the life of the installment notes, using management’s best estimates of underlying assumptions, including credit risk and interest rates as of the date of the monetization, plus the accretion of investment income based on an effective yield, which is recognized over the term of the notes, less actual cash receipts.

As of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, we were required to provide surety bonds that guarantee completion and maintenance of certain infrastructure in certain development projects and mitigation banks, as well as other financial guarantees of ~~$24.7~~$37.3 million and ~~$24.2~~$36.9 million, respectively, as well as standby letters of credit in the amount of ~~$3.3~~$16.8 million and ~~$6.6~~$12.9 million, respectively, which may potentially result in a liability to us if certain obligations are not met.

In conducting our operations, we routinely hold customers’ assets in escrow pending completion of real estate transactions and are responsible for the proper disposition of these balances for our customers. These amounts are maintained in segregated bank accounts and have not been included in the accompanying condensed consolidated balance sheets, consistent with GAAP and industry practice. The cash deposit accounts and offsetting liability balances for escrow deposits in connection with our title agencies for real estate transactions were ~~$10.3~~$10.8 million and ~~$4.5~~$9.3 million as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, respectively, these escrow funds are not available for regular operations.

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Summary of Cash Flows

A summary of our cash flows from operating, investing and financing activities are as follows:


	Nine Months Ended September 30,				Three Months Ended March 31,
	2021		2020		2022		2021

	In millions				In millions
Net cash provided by operating activities	$	65.1	$	22.5	$	19.8	$	9.8
Net cash used in investing activities		(161.0)		(140.8)		(81.3)		(71.1)
Net cash provided by financing activities		15.5		37.1		28.9		7.1
Net decrease in cash, cash equivalents and restricted cash		(80.4)		(81.2)		(32.6)		(54.2)
Cash, cash equivalents and restricted cash at beginning of the period		110.1		188.7		74.4		110.1
Cash, cash equivalents and restricted cash at end of the period	$	29.7	$	107.5	$	41.8	$	55.9

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Cash Flows from Operating Activities

Cash flows provided by operating activities includes net income, adjustments for non-cash items, changes in operating assets and liabilities and expenditures related to assets ultimately planned to be sold, including residential real estate development and related amenities, sales of timberlands or undeveloped and developed land and land developed by the commercial segment. Adjustments for non-cash items primarily include depreciation, depletion and amortization, unrealized (gain) loss on investments, net, equity in loss from unconsolidated ~~affiliates,~~joint ventures, net of distributions, deferred income tax expense, cost of real estate sold and gain on ~~contribution~~contributions to ~~equity method investment.~~unconsolidated joint ventures. Net cash provided by operations was ~~$65.1~~$19.8 million during the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~$22.5~~$9.8 million during the same period in ~~2020.~~2021. The increase in net cash provided by operating activities was primarily due to increased net income and the ~~change~~changes in cost of real estate sold and ~~gain on contribution~~other assets, partially offset by expenditures for and acquisition of real estate to ~~equity method investments~~be sold and the change in deferred revenue during the period.

Cash Flows from Investing Activities

Cash flows used in investing activities primarily ~~include~~includes capital expenditures for operating property and property and equipment used in our operations, ~~and~~ purchases of investments and capital contributions to unconsolidated joint ventures, partially offset by proceeds from insurance claims, ~~maturities~~sales and ~~sales~~maturities of investments, capital distributions from unconsolidated joint ventures and maturities of assets held by SPEs. During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, net cash used in investing activities was ~~$161.0~~$81.3 million, which included capital expenditures for operating property and equipment, ~~and~~ purchases of investments of U.S. Treasury Bills of ~~$127.9~~$74.4 million and capital contributions to unconsolidated joint ventures of $0.1 million, partially offset by proceeds from insurance claims of ~~$3.9~~$0.7 million, maturities of investments of ~~$73.0~~$45.0 million, ~~sales~~capital distributions from unconsolidated joint venture of ~~investments of $1.5~~$0.2 million and maturities of assets held by SPEs of ~~$0.8~~$0.4 million. During the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, net cash used in investing activities was ~~$140.8~~$71.1 million, which included capital expenditures for operating property and equipment, ~~and~~ purchases of investments of ~~$58.9~~U.S. Treasury Bills of $85.0 million and capital contributions to unconsolidated joint ventures of $2.5 million, partially offset by proceeds from insurance claims of $0.9 million, maturities of investments of ~~$9.0~~$39.0 million, sales of investments of ~~$3.7~~$1.2 million and maturities of assets held by SPEs of ~~$0.8~~$0.4 million.

Capital expenditures for operating property and property and equipment were ~~$112.3~~$53.1 million and ~~$95.4~~$25.1 million, during the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ respectively, which were primarily for our commercial and hospitality segments.

Cash Flows from Financing Activities

Net cash provided by financing activities during the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 was ~~$15.5~~$28.9 million, compared to ~~$37.1~~$7.1 million during the same period in ~~2020.~~2021. Net cash provided by financing activities during the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 included capital contribution from non-controlling interest of ~~$3.2~~$2.0 million and borrowings on debt of ~~$39.8~~$35.1 million, partially offset by capital ~~distribution~~distributions to non-controlling interest of ~~$1.0 million, capital contribution to unconsolidated affiliate of $9.7~~$0.7 million, dividends paid of ~~$14.1~~$5.9 million, principal payments onfor debt of ~~$1.5 million, principal payments under finance lease obligation of $0.1~~$0.5 million and debt issuance costs of $1.1 million. Net cash

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provided by financing activities during the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021 included ~~borrowings on debt of $53.1 million and~~ capital contribution from non-controlling interest of ~~$5.1~~$1.7 million and borrowings on debt of $11.3 million, partially offset by capital ~~distribution~~distributions to non-controlling interest of ~~$0.4~~$0.3 million, ~~capital contribution to unconsolidated affiliate~~dividends paid of ~~$9.0 million, the repurchase of our common stock of $8.8~~$4.7 million, principal payments onfor debt of ~~$1.4~~$0.4 million and debt issuance costs of ~~$1.5~~$0.5 million.

Contractual Obligations

There were no material changes outside the ordinary course of our business in our contractual obligations during the ~~third~~first quarter of ~~2021.~~2022.

Forward-Looking Statements

This quarterly report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements include, among other things, information about possible or assumed future results of the business and our financial condition, liquidity, results of operations, plans, strategies, prospects and objectives. Such forward-looking statements can generally be identified by our use of forward-looking

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terminology such as ~~"may," "will," "expect," "intend," "anticipate," "estimate," "believe," "continue"~~“may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue” or other similar expressions concerning matters that are not historical facts. ~~Specifically,~~

We caution you that all forward-looking statements involve risks and uncertainties, and while we believe that our expectations for the future are reasonable in view of currently available information, you are cautioned not to place undue reliance on our forward-looking statements. Actual results or events may differ materially from those indicated as a result of various important factors, including: the potential impacts of the ongoing COVID-19 pandemic; our ability to successfully implement our strategic objectives; new or increased competition across our business units; any decline in general economic conditions, particularly in our primary markets; our ability to successfully execute or integrate new business endeavors and acquisitions; our ability to yield anticipated returns from our developments and projects; our ability to effectively manage our real estate assets, as well as the ability for us or our joint venture partners to effectively manage the day-to-day activities of our joint venture projects; the illiquidity of all real estate assets; financial risks, including risks relating to currency fluctuations, credit risks, and fluctuations in the market value of our investment portfolio; any potential negative impact of our longer-term property development strategy, including losses and negative cash flows for an extended period of time if we continue with the self-development of granted entitlements; our dependence on homebuilders; reductions in travel and other risks inherent to the hospitality industry; the financial condition of our commercial tenants; regulatory and insurance risks associated with our senior living facilities; public health emergencies; any reduction in the supply of mortgage loans or tightening of credit markets; our dependence on strong migration and population expansion in our regions of development, particularly Northwest Florida; our ability to fully recover from natural disasters and severe weather conditions, including the recovery of insurance claims for losses related to Hurricane Michael; the actual or perceived threat of climate change; the seasonality of our business; our ability to obtain adequate insurance for our properties or rising insurance costs; our dependence on certain third party providers; the inability of minority shareholders to influence corporate matters, due to concentrated ownership of largest shareholder; the impact of unfavorable legal proceedings or government investigations; the impact of complex and changing laws and regulations in the areas we operate; changes in tax rates, the adoption of new U.S. tax legislation, and exposure to additional tax liabilities, including with respect to Qualified Opportunity Zone program; new litigation; our ability to attract and retain qualified employees, particularly in our hospitality business; our ability to protect our information technology infrastructure and defend against cyber-attacks; increased media, political, and regulatory scrutiny could negatively impact our reputation; our ability to maintain adequate internal controls; risks associated with our financing arrangements, including our compliance with certain restrictions and limitations; interest rate fluctuations; geopolitical conflicts and political uncertainty and the corresponding impact on the global economy; our ability to pay our quarterly dividend; the potential volatility of our common stock; and the other risks and uncertainties discussed in “Risk Factors” beginning on page 6 of our most recent annual report on Form 10-K and from time to time in our subsequent filings with the SEC . We assume no obligation to revise or publicly released any revision to any forward-looking statements contained in this quarterly report ~~contains forward-looking statements regarding:~~on Form 10-Q unless required by law.

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~~the potential impacts of the ongoing COVID-19 pandemic;~~

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~~our expectations concerning our current and future business strategy, including the use of existing assets for residential, hospitality and commercial ventures;~~

●

~~our expectations regarding our capital structure and ability to fund capital commitments;~~

●

our expectations regarding our homesites, including customer demand, our ability to develop and sell in a typical manner or at all, the amount and timing of revenue and our focus on continued investment in residential communities that have the potential for long term, scalable and repeatable revenue;

●

our intention to optimize the value of our real estate by developing residential, hospitality and commercial projects that meet growing market demands and provide opportunities to build recurring revenues and enterprise value, which may result in certain assets moving from the commercial segment to the hospitality segment;

●

~~our expectations regarding investments that we believe will contribute towards increasing our future growth, particularly in real estate projects that provide recurring revenue;~~

●

~~our 2021 capital expenditures budget and the timing of benefits of these investments;~~

●

~~our assessment and expectations regarding the impact of Hurricane Michael, including the amount and timing of insurance proceeds and ability to recover additional losses;~~

●

~~our assessment and expectations regarding the demographics and corresponding market demand and growth of Northwest Florida;~~

●

~~our beliefs regarding opportunities to develop, improve or acquire a broad range of asset types that will generate recurring revenue;~~

●

~~our intention to form additional JVs with third parties, which may be in consolidated or unconsolidated JVs with differing accounting treatments;~~

●

our plan to expand the scope and scale of our hospitality assets and services in order to enhance the value and contribution those assets provide, which may include the sale of certain hospitality properties, development of new hospitality properties, as well as new entertainment and management opportunities;

●

~~our expectations regarding our senior living communities;~~

●

our intention to continue to work collaboratively with public and private partners on strategic infrastructure and economic development initiatives that will help to attract quality job creators and help to diversify the Northwest Florida economy;

●

~~our expectations regarding opportunities near the Northwest Florida Beaches International Airport and our other land holdings in Northwest Florida;~~

●

our belief that by entering into partnerships, JVs or other collaborations and alliances with best of class operators, we can efficiently utilize our land assets while reducing our capital requirements;

●

~~our expectation to continue a cost and investment discipline to ensure low fixed expenses and bottom line performance;~~

●

our plan to continue to maintain a high degree of liquidity while seeking opportunities to invest our cash in ways that we believe will increase shareholder value, including investments in Securities, authorized dividends, share repurchases, real estate and other strategic investments;

●

our expectation regarding our liquidity or ability to satisfy our anticipated working capital needs, expected capital expenditures, principal and interest payments on our long term debt, capital contributions to JVs, Latitude Margaritaville Watersound JV Note commitment, authorized stock repurchases and authorized dividends;

●

~~our intention to continue paying a quarterly dividend;~~

●

~~our estimates and assumptions regarding the installment notes and the Timber Note;~~

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●

~~our estimates and assumptions regarding the CARES Act, the Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021;~~

●

~~our estimated impact of new accounting pronouncements; and~~

●

~~our expectation regarding the impact of pending litigation, claims, other disputes or governmental proceedings, on our cash flows, financial condition or results of operations~~.

These forward-looking statements reflect our current views about future events and are subject to risks, uncertainties and assumptions. We wish to caution readers that certain important factors may have affected and could in the future affect our actual results and could cause actual results to differ significantly from those expressed in any forward-looking statement. The most important factors that could prevent us from achieving our goals, and cause the assumptions underlying forward-looking statements and the actual results to differ materially from those expressed in or implied by those forward-looking statements include, but are not limited to, those risk factors and disclosures set forth in our Form 10-K for the year ended December 31, 2020, subsequent Form 10-Qs, other current reports, and the following:

●

any changes in our strategic objectives or our ability to successfully implement such strategic objectives, including development of our real estate, expanding our portfolio of income producing commercial and residential properties and expanding the scope of our hospitality assets and services;

●

~~our ability to capitalize on our investments in new business opportunities;~~

●

any potential negative impact of our longer-term property development strategy, including losses and negative cash flows for an extended period of time if we continue with the self-development of our entitlements;

●

~~significant decreases in the market value of our investments in Securities or any other investments;~~

●

~~our ability to attract and work effectively with strategic partners;~~

●

~~volatility in the consistency and pace of our residential real estate revenue;~~

●

~~our ability to realize the anticipated benefits of our acquisitions, JVs, investments in leasable spaces and operations and share repurchases;~~

●

~~our dependence on the real estate industry and the cyclical nature of our real estate operations;~~

●

our ability to successfully and timely obtain land use entitlements and construction financing, maintain compliance with state law requirements and address issues that arise in connection with the use and development of our land, including the permits required;

●

disruptions by an epidemic or pandemic (such as the ongoing COVID-19 pandemic), or similar public threat, or fear of such an event, and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities have implemented and may continue to implement, as well as additional measures to address it;

●

~~our ability to capitalize on strategic opportunities presented by a population growth and migration in Florida, particularly Northwest Florida;~~

●

economic or other conditions that affect the future prospects for the Southeastern region of the U.S. and the demand for our products, including a slowing of the population growth in Florida, inflation, supply chain disruptions, or unemployment rates or declines in consumer confidence or the demand for, or the prices of, housing;

●

~~our ability to accurately predict market demand for the range of potential residential, hospitality and commercial uses of our real estate holdings in Northwest Florida;~~

●

~~any reduction in the supply of mortgage loans or tightening of credit markets;~~

●

~~the impact of natural or man-made disasters or weather conditions, including hurricanes, fires and other severe weather conditions, on our business;~~

●

~~our ability to fully recover under claims for losses related to Hurricane Michael;~~

●

~~any downturns in real estate markets in Florida or across the nation;~~

●

~~increases in operating costs, including costs related to real estate taxes, owner association fees, construction materials, labor and insurance and our ability to manage our cost structure;~~

●

~~our ability to close and realize the expected revenue of the residential homesites currently under contract;~~

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●

~~our ability to successfully and timely complete homesite development;~~

●

~~our ability to realize the anticipated returns from our commercial projects;~~

●

~~our ability to maintain our commercial tenants;~~

●

~~operational risks with respect to our senior living communities;~~

●

~~our ability to effectively manage risks associated with the hospitality industry;~~

●

~~our ability to effectively manage our real estate assets, as well as the ability of us or our JV partners to effectively manage the day-to-day activities of our JV projects;~~

●

~~our ability to successfully enter into previously announced potential JVs;~~

●

~~our ability to retain key personnel and recruit staff effectively;~~

●

~~risks related to the sale of firearms;~~

●

~~the expense, management distraction and possible liability associated with litigation, claims, other disputes or governmental proceedings;~~

●

~~potential liability under environmental or construction laws, or other laws or regulations;~~

●

~~changes in laws, regulations or the regulatory environment affecting the development of real estate;~~

●

~~our ability to anticipate the impact of pending environmental litigation matters or governmental proceedings on our financial condition or results of operations;~~

●

~~our ability to fully realize benefits of the federal Qualified Opportunity Zone program;~~

●

~~the impact of changes in federal or state tax laws on our business and financial condition;~~

●

~~uncertainty about the future of LIBOR may adversely affect our business and financial results;~~

●

~~our ability to effectively deploy and invest our assets, including our Securities;~~

●

~~our ability to satisfy our current debt obligations and to obtain additional financing in the future;~~

●

the sufficiency of our current cash position, financing arrangements and cash generated from operations to satisfy our anticipated working capital needs, capital expenditures and principal and interest payments on long term debt, capital contributions to JVs, Latitude Margaritaville Watersound JV Note commitment, authorized stock repurchases and authorized dividends;

●

~~our ability to carry out any future sales of stock under the Stock Repurchase Program in accordance with applicable securities laws;~~

●

~~potential limitations on our ability to pay dividends at our expected rate, or at all;~~

●

~~the obligations associated with being a public company require significant resources and management attention; and~~

●

the impact if we have deficiencies in our disclosure controls and procedures or internal control over financial reporting; the impact if the SEC were to disagree with our Investment Company Act determinations.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to market risks primarily from interest rate risk fluctuations. We have investments in U.S. Treasury Bills that have fixed interest rates for which changes in interest rates generally affect the fair value of the investment, but not the earnings or cash flows. A hypothetical 100 basis point increase in interest rates would result in a decrease of ~~$0.3~~$0.7 million in the market value of these investments as of ~~September 30, 2021.~~March 31, 2022. Any realized gain or loss resulting from such interest rate changes would only occur if we sold the investments prior to maturity or if a decline in their value is determined to be related to credit loss.

We have exposure to credit risk associated with our Securities and these instruments are subject to price fluctuations as a result of changes in the financial market’s assessment of issuer credit quality, increases in delinquency and default rates, changes in prevailing interest rates and other economic factors. A downgrade of the U.S. government’s credit rating may also decrease the value of our Securities. As of ~~September 30, 2021,~~March 31, 2022, approximately 99% of our total Securities ~~are~~were rated AA or better.

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Our cash and cash equivalents are invested in money market instruments. Changes in interest rates related to these investments would not significantly impact our results of operations. The amount of interest earned on one of our retained interest investments is based on LIBOR. A 100 basis point change in the interest rate may result in an insignificant change in interest earned on the investment.

The amount of interest expense on some of our project financing is based on ~~LIBOR.~~LIBOR and SOFR. Based on the outstanding balance of these loans as of ~~September 30, 2021,~~March 31, 2022, a hypothetical 100 basis point increase in the applicable rate would result in an increase to our annual interest expense of ~~$0.7~~$1.4 million.

The United Kingdom's Financial Conduct Authority, which regulates LIBOR, has publicly announced that it intends to stop persuading or compelling banks to submit LIBOR rates and will cease publication of U.S. dollar LIBOR as of June 30, 2023, and U.S. regulators have issued supervisory guidance encouraging banks to cease entering into new contracts that use U.S. dollar LIBOR as a reference rate by December 31, 2021. Accordingly, LIBOR is expected to be discontinued ~~after 2021.~~in the near future. Many of our current debt agreements have an interest rate tied to LIBOR, but these agreements provide for an alternative base rate in the event that LIBOR is discontinued. There can be no assurances as to what alternative base rates may be and whether such base rate will be more or less favorable than LIBOR and any other unforeseen impacts of the potential discontinuation of LIBOR. We intend to continue monitoring the developments with respect to the potential phasing out of LIBOR ~~after 2021~~ and work with our lenders to ensure any transition away from LIBOR will have minimal impact on our financial condition.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures. Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective.

Changes in Internal Control Over Financial Reporting. During the quarter ended ~~September 30, 2021,~~March 31, 2022, there were no changes in our internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We are subject to a variety of litigation, claims, other disputes and governmental proceedings that arise from time to time in the ordinary course of our business, none of which we believe will have a material adverse effect on our consolidated financial position, results of operations or liquidity. In addition, we are subject to environmental laws and

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regulations, which include obligations to remove or limit the effects on the environment of the disposal or release of certain wastes or substances at various sites, including sites which have been previously sold. Refer to Note ~~18.~~19. Commitments and Contingencies, for further discussion.

Item 1A. Risk Factors

A description of the risk factors associated with our business is contained in the “Risk Factors” section of our annual report on Form 10-K for the fiscal year ended December 31, ~~2020.~~2021. There have been no material changes to our Risk Factors as previously reported.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults upon Senior Securities

None.

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Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

Index to Exhibits


Exhibit
Number		Description
3.1		Restated and Amended Articles of Incorporation of the registrant (incorporated by reference to Exhibit 3.1 to the registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2010).
3.2		Amended and Restated Bylaws of the registrant (incorporated by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed on March 4, 2011).
*10.1		Form of Restricted Stock Award (Executive Officers).
*31.1		Certification of Principal Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
*31.2		Certification of Principal Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
**32.1		Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
**32.2		Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*101.INS		Inline XBRL Instance Document.
*101.SCH		Inline XBRL Taxonomy Extension Schema Document.
*101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document.
*101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
*101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document.
*101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith.

** Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		THE ST. JOE COMPANY
		(Registrant)


Date:	~~October~~April 27, ~~2021~~2022	/s/ Jorge Gonzalez
		Jorge Gonzalez
		President, Chief Executive Officer and Director
		(Principal Executive Officer)


Date:	~~October~~April 27, ~~2021~~2022	/s/ Marek Bakun
		Marek Bakun
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

8270


							Accumulated
	Common Stock						Other
	Outstanding				Retained		Comprehensive		Treasury		Non-controlling
	Shares		Amount		Earnings		(Loss) Income		Stock		Interest		Total
Balance at June 30, 2021	58,882,549	$	296,873	$	273,214	$	(1,221)	$	—	$	19,649	$	588,515
Capital distribution to non-controlling interest	—		—		—		—		—		(304)		(304)
Dividends ($0.08 per share)	—		—		(4,711)		—		—		—		(4,711)
Other comprehensive income, net of tax	—		—		—		341		—		—		341
Net income	—		—		15,196		—		—		(419)		14,777
Balance at September 30, 2021	58,882,549	$	296,873	$	283,699	$	(880)	$	—	$	18,926	$	598,618


	September 30,
	2021
BALANCE SHEET:
Investment in real estate	$	10,303
Cash and cash equivalents		4,594
Other assets		199
Total assets	$	15,096

Other liabilities	$	1,140
Equity		13,956
Total liabilities and equity	$	15,096


	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
STATEMENTS OF INCOME:
Total revenue	$	201	$	263
Total expenses		187		247
Net income	$	14	$	16


				Increases Due To		Decreases Due to
		Balance		Revenue Recognized		Amounts		Balance
		January 1, 2021		for Homesites Sold		Received/Transferred		September 30, 2021
Homesite sales receivable	$	5,675	$	3,670	$	(3,376)	$	5,969


	September 30, 2021						December 31, 2020
			Unamortized						Unamortized
			Discount and						Discount and
			Debt Issuance						Debt Issuance
	Principal		Costs		Net		Principal		Costs		Net
PPN JV Loan, due November 2025, bearing interest at 4.1%	$	43,832	$	264	$	43,568	$	44,568	$	314	$	44,254
Watersound Origins Crossings JV Loan, due May 2024, bearing interest at 5.0%		36,319		274		36,045		27,179		351		26,828
PPC JV Loan, insured by HUD, due June 2060, bearing interest at 3.1% as of September 30, 2021		35,791		1,063		34,728		36,084		1,079		35,005
Watercrest JV Loan, due June 2047, bearing interest at LIBOR plus 2.2% and swapped to a fixed rate of 4.4%		19,583		330		19,253		18,066		284		17,782
PPC II JV Loan, due October 2024, bearing interest at LIBOR plus 2.1% (effective rate of 2.2% at September 30, 2021)		17,390		160		17,230		15,921		198		15,723
Airport Hotel Loan, due March 2025, bearing interest at LIBOR plus 2.0%, with a floor rate of 3.0% (effective rate of 3.0% at September 30, 2021)		14,642		137		14,505		3,548		168		3,380
Breakfast Point Hotel Loan, due November 2042, bearing interest at LIBOR plus 2.8%, with a floor rate of 3.8% (effective rate of 3.8% at September 30, 2021)		8,252		194		8,058		—		—		—
Beckrich Building III Loan, due August 2029, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)		5,247		54		5,193		5,421		59		5,362
Community Development District debt, secured by certain real estate or other collateral, due May 2023 through May 2039, bearing interest at 3.6% to 6.0%		5,015		—		5,015		6,294		—		6,294
The Lodge 30A JV Loan, due January 2028, bearing interest at 3.8%		4,493		186		4,307		—		—		—
Self-Storage Facility Loan, due November 2025, bearing interest at LIBOR plus 2.5%, with a floor rate of 3.0% (effective rate of 3.0% at September 30, 2021)		4,135		74		4,061		—		—		—
Beach Homes Loan, due May 2029, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)		1,505		16		1,489		1,545		17		1,528
Pier Park Outparcel Construction Loan, due March 2027, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)		1,393		11		1,382		1,458		12		1,446
WaterColor Crossings Construction Loan, due February 2029, bearing interest at LIBOR plus 1.7% (effective rate of 1.8% at September 30, 2021)		1,283		18		1,265		1,334		21		1,313
Total debt	$	198,880	$	2,781	$	196,099	$	161,418	$	2,503	$	158,915


	Club Initiation Fees
Balance as of January 1, 2021	$	10,716
New club memberships		12,283
Revenue from amounts included in contract liability opening balance		(2,310)
Revenue from current period new memberships		(866)
Balance as of September 30, 2021	$	19,823


	Club Initiation Fees
Balance as of January 1, 2020	$	6,917
New club memberships		3,441
Revenue from amounts included in contract liability opening balance		(1,600)
Revenue from current period new memberships		(190)
Balance as of September 30, 2020	$	8,568


	Three Months Ended September 30, 2021
	Before-		Tax (Expense) or		Net-of-
	Tax Amount		Benefit		Tax Amount
Unrealized gain on available-for-sale investments	$	3	$	(1)	$	2
Interest rate swap		301		(76)		225
Interest rate swap - unconsolidated affiliate		(1)		—		(1)
Reclassification adjustment for net loss included in earnings		154		(39)		115
Net unrealized gain		457		(116)		341
Other comprehensive income	$	457	$	(116)	$	341


	Nine Months Ended September 30, 2020
	Before-		Tax (Expense)		Net-of-
	Tax Amount		Benefit		Tax Amount
Unrealized gain on available-for-sale investments	$	127	$	(32)	$	95
Unrealized gain on restricted investments		7		(2)		5
Interest rate swap		(865)		219		(646)
Interest rate swap - unconsolidated affiliate		(843)		214		(629)
Reclassification adjustment for net gain included in earnings		(4)		1		(3)
Net unrealized loss		(1,578)		400		(1,178)
Other comprehensive loss	$	(1,578)	$	400	$	(1,178)