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What changed in Comstock Holding Companies, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Comstock Holding Companies, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+122 added−127 removedSource: 10-K (2025-03-21) vs 10-K (2024-03-21)

Top changes in Comstock Holding Companies, Inc.'s 2024 10-K

122 paragraphs added · 127 removed · 93 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeOur Portfolio The following table summarizes the operating assets that are included in our managed portfolio: Type # of Assets Size/Scale % Leased Commercial 13 2.0 million sqft. 92% Residential 6 1.8 million sqft. / ~1,700 units 97% Parking 30 18,000+ spaces Total 49 In addition, we manage the following assets that are under construction and scheduled for delivery in the next 12 to 24 months: • 3 commercial assets representing approximately 600,000 square feet; • 1 residential asset with 420 units representing approximately 430,000 square feet; • 1 JW Marriott-branded hotel/condominium with 243 keys and 95 residential units representing a total of approximately 520,000 square feet; and • 2 commercial parking garages with approximately 2,900 spaces.
Biggest changeIn addition, we manage the following assets that are under construction and scheduled for delivery in the next 6 to 12 months: • 2 commercial assets representing approximately 266,000 square feet; • 1 residential asset with 420 units representing approximately 430,000 square feet; • 1 JW Marriott-branded hotel/condominium with 247 keys and 94 residential units representing a total of approximately 520,000 square feet; and • 1 commercial parking garage with approximately 1,300 spaces.
BLVD Ansel features approximately 20,000 square feet of retail space, 611 parking spaces, and expansive amenities including multiple private workspaces designed to meet the needs of remote-working residents. In connection with the transaction, we received an acquisition fee and are entitled to receive investment related income and promote distributions in connection with our 5% equity interest in the asset.
BLVD Ansel features approximately 20,000 square feet of retail space, 611 parking spaces, and expansive amenities including multiple private workspaces designed to meet the needs of remote-working residents. In connection with the transaction, we received an acquisition fee and are entitled to receive investment related income and promote distributions in connection with our 5.0% equity interest in the asset.
In connection with the transaction, we received an acquisition fee and are entitled to receive investment related income and promote distributions in connection with our 5% equity interest in the asset. We also provide asset, residential, retail and parking property management services for the property in exchange for market rate fees.
In connection with the transaction, we received an acquisition fee and are entitled to receive investment related income and promote distributions in connection with our 5.0% equity interest in the asset. We also provide asset, residential, retail and parking property management services for the property in exchange for market rate fees.
In Northern Virginia specifically, growing demand for technology and cybersecurity services has driven the proliferation of major corporations opening operational headquarters in the region, including Amazon, Microsoft, CoStar, Nestle, Raytheon Technologies, Boeing, and others to the region.
In Northern Virginia specifically, growing demand for technology and cybersecurity services has driven the proliferation of major corporations opening operational headquarters in the region, including Amazon, Microsoft, CoStar, Nestle, Raytheon Technologies, Boeing, and others.
The following are highlights from our 2023 ESG Report, the full version of which can be found on our website: www.Comstock.com/Corporate-Responsibility . Environmental We believe that environmentally sound business practices are critical to the long-term success of our business and the communities in which we operate.
The following are highlights from our 2024 ESG Report, the full version of which can be found on our website: www.Comstock.com/Corporate-Responsibility . Environmental We believe that environmentally sound business practices are critical to the long-term success of our business and the communities in which we operate.
We have become the area’s premier real estate service company by creating extraordinary places, delivering exceptional experiences, and generating excellent results for all stakeholders. Since 1985, we have acquired, developed, operated, and sold millions of square feet of residential, commercial, and mixed-use properties.
We have become the area’s premier real estate service company by creating extraordinary places, providing exceptional experiences, and generating excellent results for all stakeholders. Since 1985, we have acquired, developed, operated, and sold millions of square feet of residential, commercial, and mixed-use properties.
Located one block from the Rockville Station on Metro's Red Line and in the heart of the I-270 Technology and Life Science Corridor, the 263-unit mixed use property includes approximately 16,000 square feet of retail and a commercial parking garage.
Built in 2015 and located one block from the Rockville Station on Metro's Red Line and in the heart of the I-270 Technology and Life Science Corridor, the 263-unit mixed use property includes approximately 16,000 square feet of retail and a commercial parking garage.
This approach enables us to minimize risk and retain the flexibility to pursue additional value-add, core, and core-plus investments and acquisitions as new opportunities emerge. We have worked closely with our affiliates to secure public-private partnerships with local governments from Fairfax County, Loudoun County, and the Town of Herndon in Virginia to develop and manage large-scale mixed-use, transit-oriented developments.
This approach enables us to minimize risk and retain the flexibility to pursue additional value-add, core, and core-plus investments and acquisitions as new opportunities emerge. We have worked closely with our affiliates to secure public-private partnerships with local governments from Fairfax County and Loudoun County in Virginia to develop and manage large-scale mixed-use, transit-oriented developments.
The Reston Station neighborhood is being developed in phases and is composed of the following five districts: 2 Table of Contents • Metro Plaza District (Operating) The Metro Plaza District is located adjacent to Wiehle Reston-East Metro Station and contains approximately 1.4 million square feet of mixed-use development, highlighted by three Trophy-Class office buildings and BLVD Reston, a luxury residential tower with 448 units.
The Reston Station neighborhood is being developed in phases and is composed of the following five districts: • Metro Plaza District (Operating) The Metro Plaza District is located adjacent to Wiehle Reston-East Metro Station and contains approximately 1.4 million square feet of mixed-use development, highlighted by three Trophy-Class office buildings and BLVD Reston, a luxury residential tower with 448 units.
We are currently leasing and managing the four existing office buildings and one existing retail building while finalizing plans for the permitted new development. • Midline District (In Development) The Midline District, located directly across Wiehle Avenue from the Reston Row District and the Metro Plaza District, has entitlements in place that allow for approximately 1.2 million square feet of new mixed-use development on approximately 8 acres.
We are currently leasing and managing the four existing office buildings and one existing retail building while finalizing plans for the permitted new development. • Midline District (In Development) The Midline District, located directly across Wiehle Avenue from the Reston Row District and the Metro Plaza District, has entitlements in place that allow for approximately 1.2 million square feet of new mixed-use development.
We distinguish ourselves from industry peers through an established standard of excellence that extends from who we hire to how we deliver our broad suite of real estate services.
We distinguish ourselves from industry peers through an established standard of excellence that extends from who we hire to how we deliver our comprehensive suite of real estate services.
We employ a talented staff of real estate professionals that are led by our seasoned management team and are tasked with delivering high-quality services to the premium, strategically located assets in our managed portfolio.
We employ a team of talented real estate professionals that is led by our seasoned management team and is tasked with delivering high-quality services to the premium, strategically located assets in our managed portfolio.
We specialize in supporting the seamless integration of residential, commercial, and retail offerings into vibrant mixed-use communities, exemplified by Reston Station and Loudoun Station, two assets in our Anchor Portfolio that are among the region's largest and most prominent mixed-use, transit-oriented developments.
We specialize in supporting the seamless integration of residential, commercial, and retail offerings into vibrant mixed-use communities, exemplified by Reston Station and Loudoun Station, two assets in our Anchor Portfolio (see "Our Portfolio" for additional information) that are among the region's largest and most prominent mixed-use, transit-oriented developments.
This relationship, along with the 2022 AMA that includes a baseline cost-plus feature and supplemental performance-based revenue opportunities, provide us with a stable, streamlined business platform on which we can (i) produce consistent, positive financial results, (ii) mature and expand our real estate service offerings, (iii) diversify and grow our managed portfolio of assets, both organically and through additional third-party relationships, (iv) pursue strategic investments and complimentary acquisitions, and (v) deliver exceptional value to our shareholders.
This relationship, along with the baseline cost-plus feature and supplemental performance-based revenue opportunities provided by the 2022 AMA, provides us with a stable business platform on which we can (i) produce consistent, positive financial results, (ii) mature and expand our real estate service offerings, (iii) diversify and grow our managed portfolio of assets, both organically and through additional third-party relationships, (iv) pursue strategic investments and complimentary acquisitions, and (v) deliver exceptional value to our shareholders.
It is home to corporate and regional headquarters of Google, ICF Global, Spotify, Qualtrics, Rolls-Royce of North America, Neustar, and others. All buildings in the Metro Plaza District have ground floor retail, which has been leased to high-quality tenants, including Starbucks, CVS, Founding Farmers, Matchbox, Scissors & Scotch, and others.
It is home to corporate and regional headquarters of Google, ICF Global, Spotify, 2 Table of Contents Qualtrics, Rolls-Royce of North America, Carfax, and others. All buildings in the Metro Plaza District have ground floor retail, which has been leased to high-quality tenants, including Starbucks, CVS, Founding Farmers, Matchbox, Scissors & Scotch, and others.
We are currently updating the entitlements secured by the previous owner and plan to commence development and leasing operations after receiving the necessary permits for the new development. • West District (In Development) The West District currently consists of approximately 11 acres of land located adjacent to the Reston Row District and Metro Plaza District and includes a previously developed 90,000 square foot office building owned by one of our affiliates and an apartment building owned by a third party.
We are currently updating the entitlements secured by the previous owner and plan to commence development and leasing operations after receiving the necessary permits for the new development. • West District (In Development) The West District sits adjacent to the Reston Row District and Metro Plaza District and includes a previously developed 90,000 square foot office building owned by one of our affiliates and an apartment building owned by a third party.
A key to our success is our ability to attract and retain a talented workforce that understands the numerous benefits of working in-office rather than remotely. We employ a diverse, multi-generational staff that consisted of 172 full-time and 28 part-time employees as of December 31, 2023.
A key to our success is our ability to attract and retain a talented workforce that understands the numerous benefits of working in-office rather than remotely. We employ a diverse, multi-generational staff that consisted of 206 full-time and 45 part-time employees as of December 31, 2024.
The Reston Station transit facility provides Metro commuters with an indoor bus transit depot designed to accommodate upwards of 110 buses per hour, 2,300 commuter parking spaces operated by Fairfax County, and approximately 2,750 additional parking spaces for retail, office, and commuter uses, a Tesla Super Charging Station and numerous other electric vehicle charging stations, secure bicycle parking and storage facilities, substantial storm water management vaults, and state-of-the-art water treatment systems. • Reston Row District (Under Construction) The Reston Row District is currently being developed on approximately 9 acres adjacent to the Metro Plaza District.
The Reston Station transit facility provides Metro commuters with an indoor bus transit depot designed to accommodate upwards of 110 buses per hour, 2,300 commuter parking spaces operated by Fairfax County, and approximately 2,750 additional parking spaces for retail, office, and commuter uses, a Tesla Super Charging Station and numerous other electric vehicle charging stations, secure bicycle parking and storage facilities, substantial storm water management vaults, and state-of-the-art water treatment systems. • Reston Row District (Operating + Under Construction) The Reston Row District (i.e., The Row at Reston Station) is the newest phase of the Reston Station development and is currently being constructed adjacent to the Metro Plaza District.
We maintain a market-leading position in Northern Virginia's Dulles Corridor, which is undergoing an urban transformation as a result of the creation and expansion of Metro's Silver Line, which connects Loudoun County and Dulles International Airport to Reston, Tysons, Washington, D.C., and suburban Maryland.
We maintain a market-leading position in Northern Virginia's Dulles Corridor, an area that is undergoing an urban transformation driven by the creation of Metro's Silver Line, which connects Loudoun County and Dulles International Airport to Reston, Tysons, Washington, D.C., and suburban Maryland.
Our development pipeline currently includes 5 commercial assets that represent approximately 1.5 million square feet, 6 residential assets with 2,599 units that represent approximately 2.8 million square feet, and 1 hotel that will include 140 keys. At full build out, our managed portfolio of assets is currently projected to total 68 assets that represent nearly 10 million square feet.
Our development pipeline currently includes 5 commercial assets that represent approximately 1.5 million square feet, 5 residential assets with 2,326 units that represent approximately 2.5 million square feet, and 1 hotel that will include 140 keys. At full build out, our managed portfolio of assets is currently projected to total 88 assets that represent approximately 10 million square feet.
In 2022, we announced a partnership with DAVIS Construction on the introduction of CarbonCure, a sustainable concrete component, in the construction of Phase II of our Reston Station development (A/K/A Reston Row District).
We have a partnership with DAVIS Construction on the utilization of CarbonCure, a sustainable concrete component, in the construction of Phase II of our Reston Station development (the Reston Row District).
We provide a broad suite of asset management, property management, development and construction management, and other real estate-related services to our asset-owning clients, composed primarily of institutional real estate investors, high net worth family offices, financial institutions, and governmental bodies seeking to enhance their surrounding communities by developing real estate they own through public-private partnerships.
We provide a comprehensive suite of real estate services to our asset-owning clients, including asset management, property management, development and construction management, and more. Our client base is composed primarily of institutional real estate investors, high net worth family offices, financial institutions, and governmental bodies seeking to develop real estate they own through public-private partnerships.
As part of the transaction, we entered into asset management and property management agreements to manage the property. BLVD Forty Four In October 2021, we entered into a joint venture with CP to acquire a stabilized 15-story, luxury high-rise apartment building in Rockville, Maryland that was built in 2015, which we rebranded as BLVD Forty Four.
BLVD Forty Four In October 2021, we entered into a joint venture with CP to acquire a stabilized 15-story, luxury high-rise apartment building in Rockville, Maryland that we rebranded as BLVD Forty Four.
Our employees have access to a comprehensive suite of benefits, including, but not limited to, medical, dental, vision, and life insurance options; flexible and health savings accounts; 401k plan matching; and professional development reimbursement.
Our employees have access to a comprehensive suite of benefits, including, but not limited to, medical, dental, vision, and life 6 Table of Contents insurance options; flexible and health savings accounts; 401k plan matching; and professional development reimbursement. We offer numerous wellness initiatives and training opportunities, including diversity training and a broad suite of e-learning courses.
The Hartford In December 2019, we entered into a joint venture with CP to acquire The Hartford Building ("The Hartford"), a stabilized Class-A office building immediately adjacent to Clarendon Station on Metro’s Orange Line in Arlington County, Virginia’s premier transit-oriented office market, the Rosslyn-Ballston Corridor.
The Hartford In December 2019, we entered into a joint venture with CP to acquire The Hartford Building ("The Hartford"), a stabilized Class-A office building immediately adjacent to Clarendon Station on Metro’s Orange Line in Arlington County, Virginia. Built in 2003, the 211,000 square foot LEED Gold-certified, mixed-use building located in the premier Rosslyn-Ballston corridor.
Competition The real estate asset management and services industry is highly competitive. We compete with other businesses in the asset management and real estate-related services businesses on the basis of price, location, experience, service and reputation.
We had no material publicly reportable information security incidents in the fiscal year ended December 31, 2024 . Competition The real estate asset management and services industry is highly competitive. We compete with other businesses in the asset management and real estate-related services businesses on the basis of price, location, experience, service and reputation.
We are able maintain this high standard because We Show Up - every day, in person, in a collaborative environment that is structured to deliver on our mission to make a difference for our customers, our stakeholders, and in the communities that we serve.
We are able to maintain this high standard because We Show Up - every day, in person, in a collaborative environment that is structured to deliver on our mission to make a difference for our customers, our stakeholders, and in the communities that we serve. 1 Table of Contents Our Services Our experienced team of professionals provides a comprehensive suite of services and solutions related to the management, development, and operation of real estate assets.
We continue to expand our capabilities around monitoring energy and utility consumption at all our properties, allowing us to better identify opportunities to maximize efficiency and sustainability through operational and capital improvements.
Currently, all buildings in the Reston Metro Plaza District in Reston Station are LEED Silver certified or above and Energy Star certified. We continue to expand our capabilities around monitoring energy and utility consumption at all our properties, allowing us to better identify opportunities to maximize efficiency and sustainability through operational and capital improvements.
This newest phase of the Reston Station development has entitlements in place allowing for approximately 1.5 million square feet of mixed-use development and will include two Trophy-Class office buildings, a residential building with 420 multifamily units, over 100,000 square feet of retail, and Virginia's first JW Marriott Hotel and Condominium tower, which will have 243 hotel rooms, 95 JW Marriott-branded condominium residences, and approximately 25,000 square feet of meeting space. • Commerce District (In Development) The Commerce District is located on approximately 16 acres adjacent to Wiehle Reston-East Metro Station, directly across the Dulles Toll Road from the Metro Plaza District.
It has entitlements in place allowing for approximately 1.5 million square feet of mixed-use development and, when completed, will feature two Trophy-Class office buildings, a residential building with 420 multifamily units, over 100,000 square feet of retail, and Virginia's first JW Marriott Hotel and Condominium tower, which will have 243 hotel rooms, 94 JW Marriott-branded condominium residences, and approximately 25,000 square feet of meeting space.
Parking Our wholly owned subsidiary ParkX currently manages a total of 30 commercial parking garages and spaces, including 13 commercial parking garages owned by unaffiliated parties. 4 Table of Contents Our Business Strategy In early 2018, we transitioned away from the development and sale of residential homes to our current business model, which primarily focuses on driving recurring fee-based revenue streams from the asset and property management services we provide for commercial and mixed-use real estate properties in the greater Washington, D.C. region.
In addition, ParkX provides approximately 2,555 hours per week of security, concierge, and other alternative property management services across 32 different properties, 12 of which are also managed parking garage locations. 4 Table of Contents Our Business Strategy In early 2018, we transitioned away from the development and sale of residential homes to our current business model, which primarily focuses on driving recurring fee-based revenue streams from the asset and property management services we provide for commercial and mixed-use real estate properties in the greater Washington, D.C. region.
Anchor Portfolio Reston Station Reston Station is one of the largest mixed-use, transit-oriented developments in the mid-Atlantic region. Located at the Wiehle-Reston East station on Metro’s Silver Line, the Reston Station neighborhood spans the Dulles Toll Road and covers approximately 90 acres.
Located at the Wiehle-Reston East station on Metro’s Silver Line, the Reston Station neighborhood spans the Dulles Toll Road and covers approximately 90 acres.
Other Portfolio Assets The following summarizes additional operating assets that are currently in our managed portfolio: Investors X On April 30, 2019, we entered into a Master Transfer agreement with CPRES, that provided for priority distribution of residual cash flow from its Class B membership interest in Comstock Investors X, L.C.
At full build, the Loudoun Station development will cover nearly 50 acres. 3 Table of Contents Other Portfolio Assets The following summarizes additional operating assets that are currently in our managed portfolio: Investors X In April 2019, we entered into a Master Transfer agreement with CP Real Estate Services, LC (“CPRES”), an entity owned by Comstock’s Chief Executive Officer, Christopher Clemente, that provided for priority distribution of residual cash flow from its Class B membership interest in Comstock Investors X, L.C.
Every cubic yard of concrete produced with CarbonCure technology saves an average of 25 pounds of carbon from entering the atmosphere, which will save millions of pounds of CO 2 emissions from entering the atmosphere. Furthermore, we intend to engage our supply chain to incorporate sustainable designs, materials, and systems into all ongoing or future developments.
Every cubic yard of concrete produced with CarbonCure technology saves an average of 25 pounds of carbon from entering the atmosphere, which will save millions of pounds of CO 2 emissions from entering the atmosphere.
The core responsibility of our Board is to exercise its fiduciary duty to act in the best interests of our Company and our stockholders. In exercising this obligation, our Board and its individual committees perform several specific functions, including risk assessment, review and oversight.
In exercising this obligation, our Board and its individual committees perform several specific functions, including risk assessment, review and oversight. While management is responsible for the day-to-day management of risk, our Board retains oversight of risk management for our company, assisting management by providing guidance on strategic risks, financial risks, and operational risks.
Our information security team deploys an array of cybersecurity capabilities to protect our various business systems and data. We continually invest in protecting against, monitoring, and mitigating risks across the enterprise. We had no material publicly reportable information security incidents in the fiscal year ended December 31, 2023 .
We have established corporate governance guidelines and policies that promote Company values, including a code of conduct as well as a code of ethics. Our information security team deploys an array of cybersecurity capabilities to protect our various business systems and data. We continually invest in protecting against, monitoring, and mitigating risks across the enterprise.
Our asset management services platform is anchored by the 2022 AMA, which covers all the assets in our Anchor Portfolio. In addition, we have entered into separate asset management agreements for non-Anchor Portfolio assets.
We have entered into separate asset management agreements for non-Anchor Portfolio assets.
As a vertically integrated real estate services company, we perform all property management activity through three wholly owned operational subsidiaries: CHCI Commercial Management, LC (“CHCI Commercial”); CHCI Residential Management, LC (“CHCI Residential”); and ParkX Management, LC (“ParkX”).
We provide asset management services for market-rate fees to all the commercial and residential assets in our managed portfolio, as well as to certain assets managed by ParkX (see below). • As a vertically integrated real estate services company, we perform all property management services through three wholly owned subsidiaries: CHCI Commercial, CHCI Residential, and ParkX Management ("ParkX").
All properties included in our managed portfolio have entered into property management agreements with our three wholly owned operational subsidiaries that provide for market-rate fees related to our services.
All properties in our managed portfolio have entered into property management agreements that provide for market-rate fees related to our services. Our asset-light, debt-free business model allows us to substantially mitigate risks that are typically associated with real estate development and operation.
We offer numerous wellness initiatives and training opportunities, including diversity training and a broad suite of e-learning courses. 6 Table of Contents Governance Our employees, managers and officers conduct our business under the direction of our CEO and the oversight of our Board of Directors (the “Board”) to enhance our long-term value for our stockholders.
Governance Our employees, managers and officers conduct our business under the direction of our CEO and the oversight of our Board of Directors (the “Board”) to enhance our long-term value for our stockholders. The core responsibility of our Board is to exercise its fiduciary duty to act in the best interests of our Company and our stockholders.
Our asset management services platform is anchored by a long-term full-service asset management agreement with a Comstock affiliate that extends through 2035 and covers all of the properties in our Anchor Portfolio (the "2022 AMA" - see below for additional details).
We primarily operate under long-term asset management and property management agreements that provide recurring, fee-based revenue streams. • Our asset management services platform is anchored by a long-term, full-service asset management agreement with Comstock Partners, LC ("CP"), an affiliate entity controlled by our Chief Executive Officer, Christopher Clemente, which includes a cost-plus fee structure and covers all of the properties in our Anchor Portfolio (the "2022 AMA" - See Note 13 in the Notes to Consolidated Financial Statements for additional information).
Built in 2003, the 211,000 square foot mixed-use Leadership in Energy and Environmental Design (“LEED”) GOLD building is leased to multiple high-quality tenants. In February 2020, we arranged for DivcoWest, an unaffiliated entity, to purchase a majority ownership stake in The Hartford and secured a $87 million loan facility from MetLife.
In February 2020, we arranged for DivcoWest, an unaffiliated entity, to purchase a majority ownership stake in The Hartford and secured a $87 million loan facility from MetLife. As part of the transaction, we entered into asset management and property management agreements for the building to go along with our 2.5% equity interest.
("Investors X"), an unconsolidated variable interest entity that owns Comstock’s residual homebuilding operations. As of December 31, 2022, the residual cash flow primarily relates to anticipated proceeds from the sale of rezoned residential lots and returns of cash securing outstanding letters of credit and cash collateral posted for land development bonds covering work performed by subsidiaries owned by Investors X.
("Investors X"), an unconsolidated variable interest entity that owns Comstock’s residual homebuilding operations. As of December 31, 2024, all residential lots have been sold. The proceeds from the lot sales will be distributed to the Company as remaining land development work associated with these projects is completed.
The services we provide cover all aspects of real estate asset management, including acquisition and disposition management, leasing, design, placemaking, property management, origination and negotiation of debt and equity facilities, risk management, construction and development management, creation of investment opportunities, execution of core-plus, value-add, and opportunistic strategies, and various other property-specific services.
The services we provide include asset management, property/facility management (including security, concierge, firewatch, and more), development and construction management, leasing and marketing, acquisition and disposition, asset recapitalization, design (including planning and entitlements), strategic investment consultation and execution, and various other property-specific services.
We operate a fee-based, asset-light, and substantially debt-free business model that allows us to substantially mitigate risks that are typically associated with real estate development and operation. We have directly aligned the equity ownership of our Company with the ownership interests of the affiliated assets that we manage in our Anchor Portfolio.
The fee-based approach we have adopted helps drive consistent top-line growth that, along with our streamlined balance sheet, provides maximum flexibility to explore growth opportunities outside of our core business operations. We have directly aligned the equity ownership of our Company with the ownership interests of the affiliated assets that we manage in our Anchor Portfolio.
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Significant Developments CES Divestiture On March 31, 2022, we completed the sale of Comstock Environmental Services, LLC ("CES"), a wholly owned subsidiary, to August Mack Environmental, Inc. ("August Mack"). This strategic divestiture was based on the continued growth and future prospects of our asset management business.
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Our Managed Portfolio The focus of our managed portfolio revolves primarily around high quality, mixed-use real estate properties and developments that are strategically located adjacent to Metro rail stations, providing convenient access to public transportation.
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Accordingly, we have reflected CES as a discontinued operation in our consolidated financial statements for all periods presented, and unless otherwise noted, all amounts and disclosures relate solely to our continuing operations.
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The following table summarizes the operating assets that were included in our managed portfolio as of December 31, 2024: Type # of Assets Size/Scale % Leased Commercial (1) 14 2.3 million sqft. 82% Residential 6 1.8 million sqft. / ~1,700 units 96% ParkX - Garages 32 22,000+ spaces ParkX - Security & Other (2) 20 ~2,500 hrs/week Total 72 (1) Commercial % leased includes Q1 2024 delivery of a new office tower located in The Row at Reston Station.
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(See Note 3 in the Notes to Consolidated Financial Statements for additional information). 1 Table of Contents Series C Preferred Stock Redemption and 2022 Asset Management Agreement On June 13, 2022, we completed two separate significant transactions to further deleverage our balance sheet and enhance our long-term revenue outlook and growth potential.
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Excluding that impact, the % leased for stabilized assets is 93%. (2) # of assets total excludes 12 properties where both parking & other services are provided to avoid double-counting.
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The first one with CP Real Estate Services, LC (“CPRES”), an entity owned by Christopher Clemente, Comstock’s Chief Executive Officer, redeemed all outstanding Series C preferred stock at a significant discount to carrying value. Secondly, we executed a new asset management agreement with Comstock Partners, LC ("CP"), an entity controlled by Mr. Clemente and wholly owned by Mr.
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Anchor Portfolio Our Anchor Portfolio (see below for details) includes, or will soon include, millions of square feet of Trophy and Class A office towers, luxury multi-family residential buildings, luxury hotels with branded condominium residences, high-end retail and entertainment options, associated public spaces, and commercial parking garages to serve all the properties.
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Clemente and certain family members, which covers our Anchor Portfolio of assets (the "2022 AMA").
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In 2024, Anchor portfolio assets generated a well over $100.0 million of gross revenue for the property owners. Reston Station (Operating + Under Construction+ In Development) Reston Station is one of the largest mixed-use, transit-oriented developments in the mid-Atlantic region.
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The 2022 AMA increased the base fees we collect, expanded the services that qualify for additional supplemental fees, extended the term through 2035, and most notably introduced a mark-to-market incentive fee based on the imputed profit of Anchor Portfolio assets, generally as each is stabilized and as further specified in the agreement.
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The first office tower was delivered in 2024 and the remainder of the development is expected to be substantially delivered by the end of 2025. • Commerce District (In Development) The Commerce District is located adjacent to Wiehle Reston-East Metro Station, directly across the Dulles Toll Road from the Metro Plaza District.
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(See Notes 10 and 14 in the Notes to Consolidated Financial Statements for additional information). Our Services Our experienced team of professionals provides a comprehensive suite of services and solutions related to the acquisition, development, and operation of real estate assets.
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In November 2024, we entered into a definitive purchase agreement for Comstock 41 with SCG Development Holdings, LLC ("SCG") that is contingent upon the successful rezoning of the property to allow for the development of an affordable housing project at the site.
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At full build, the Loudoun Station development will cover nearly 50 acres. 3 Table of Contents Herndon Station (In Development) Herndon Station will include up to approximately 340,000 square feet of residential, retail and entertainment spaces, including a performing arts center, and an approximately 700-space commercial parking garage in the historic downtown portion of the Town of Herndon in western Fairfax County, Virginia.
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Upon closing, we will enter into an operating agreement and a development agreement with SCG, under which we will provide construction management services for the affordable housing project that will be fully financed by SCG. We will also be entitled to provide property management services once the development is ready for occupancy.
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The project is the focus of a public-private partnership between a Comstock affiliate and the Town of Herndon and will include improvements to existing connections to the adjacent WO&D trail, a popular pedestrian and bicycle route that stretches from Washington, D.C. to Loudoun County, Virginia.
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Parking ParkX, one of our wholly owned operating subsidiaries, currently manages a total of 32 commercial parking garages, including 17 commercial parking garages owned by unaffiliated parties.
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The cash will be released to CHCI as bond release work associated with these projects is completed.
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The Reston Row District is expected to utilize approximately 500,000 cubic yards of CarbonCure, which will divert 5 million pounds of carbon, or the equivalent of 258,000 gallons of gasoline not being burned. Furthermore, we intend to engage our supply chain to incorporate sustainable designs, materials, and systems into all ongoing or future developments.
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While management is responsible for the day-to-day management of risk, our Board retains oversight of risk management for our company, assisting management by providing guidance on strategic risks, financial risks, and operational risks. We have established corporate governance guidelines and policies that promote Company values, including a code of conduct as well as a code of ethics.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWhile management is responsible for the day-to-day management of risk, our Board of Directors maintains oversight of management’s implementation of our cybersecurity risk management processes. Our Board of Directors receives briefings on material cybersecurity incidents, as necessary. Our Vice President of Information Technology provides principal oversight and guidance of our cybersecurity risk management strategy, programs, and processes.
Biggest changeThe Board is briefed on material cybersecurity incidents as necessary to maintain transparency and informed decision-making. Our Vice President of Information Technology leads our cybersecurity strategy, programs, and risk management processes. With over 30 years of experience in IT, including 15+ years in cybersecurity, the Vice President provides strategic oversight and ensures alignment with industry best practices.
Item 1C. Cybersecurity Risk Management and Strategy To mitigate cybersecurity risks we strive to continually assess and improve our processes and procedures. We engage with industry-leading managed security service providers to supplement our efforts in identifying, assessing, preventing, and responding to cybersecurity threats.
Item 1C. Cybersecurity Risk Management and Strategy To mitigate cybersecurity risks, we continuously assess and enhance our security processes and procedures. We collaborate with industry-leading managed security service providers to strengthen our ability to identify, assess, prevent, and respond to cybersecurity threats.
We have adopted a cybersecurity risk management process that is designed to identify and mitigate potential cybersecurity risks and is currently being integrated into our overall enterprise risk management process. We regularly assess our cybersecurity vulnerability by utilizing credible, third-party cybersecurity experts to conduct annual internal penetration tests and monthly vulnerability scans.
These third-party providers conduct annual Statement on Standards for Attestation Engagements ("SSAE") audits, ensuring compliance with industry best practices. We have adopted a cybersecurity risk management framework designed to identify and mitigate potential cybersecurity risks, which is being integrated into our overall enterprise risk management program.
He is supported by a team of technical experts who have received formal training and possess relevant experience in addition to managed cybersecurity service providers who specialize in preventing, identifying, and responding to cybersecurity threats. As part of our annual enterprise risk assessment, technology cybersecurity risks are ranked and reviewed by management.
This role is supported by a team of cybersecurity professionals with formal training and specialized expertise, as well as partnerships with managed security service providers focused on proactive threat detection, incident response, and risk mitigation. As part of our annual enterprise risk assessment, cybersecurity risks are ranked and reviewed by executive management.
In the event of a cybersecurity incident, the Vice President of Information Technology would prepare a comprehensive assessment for management that summarizes potential and actual impacts and includes any steps needed to remediate the identified issues.
In the event of a cybersecurity incident, the Vice President of Information Technology, in collaboration with our cybersecurity partners, would conduct a comprehensive impact assessment. This assessment would outline both potential and actual risks, along with 8 Table of Contents necessary remediation steps.
We are working to align our information technology operations and information security processes to the National Institute of Standards and Technology’s framework. We have adopted a cloud-first strategy which is a foundational element to our overall cybersecurity posture. For essential systems, we utilize SaaS-based software partners who annually conduct Statement on Standards for Attestation Engagements.
Our information technology operations and security processes are being aligned with the National Institute of Standards and Technology (NIST) framework to further standardize and improve our security posture. As part of our commitment to a cloud-first strategy, we prioritize the use of SaaS-based solutions for critical business functions.
If the cybersecurity incident was deemed to be material by management, the Vice President of Information Technology would brief our 8 Table of Contents Board of Directors on the matter, at which time determinations would be made by the Board of Directors on the need to report or disclose the cybersecurity incident to our customers or investors.
If an incident is deemed material, the Vice President would escalate the matter to the Board of Directors, who would determine whether disclosure to customers or investors is required.
Removed
These threat intelligence and monitoring activities, tests, and scans help us identify potential cybersecurity risks. We seek to mitigate cybersecurity risks we identify through a variety of methods; however, we acknowledge that even a robust, well-designed information technology control environment may not fully eliminate cybersecurity risk .
Added
Our risk assessments are informed by third-party cybersecurity experts, who conduct annual internal penetration tests and monthly vulnerability scans to continuously evaluate and strengthen our security posture. Cybersecurity risks are categorized using a Critical, High, Medium, and Low risk scoring methodology.
Removed
It is possible that we will be unable to detect certain vulnerabilities in time to remediate them, or that our implemented controls may not operate as intended. To date, we have not experienced any material cybersecurity incidents.
Added
These assessments are performed through a combination of automated tools, manual audits, and expert evaluations, allowing us to implement effective controls that enhance our security framework. In addition, we have introduced annual cybersecurity awareness training, phishing simulations, and ongoing communication initiatives to strengthen organizational awareness of cybersecurity risks and threat prevention.
Removed
We remain subject to the risks from cybersecurity threats that, if realized, are reasonably likely to materially affect the Company’s business strategy, results of operations, or financial condition. Governance Our Board of Directors considers cybersecurity as part of its risk oversight function.
Added
To date, we and our subsidiaries have not experienced any material cybersecurity incidents. Governance Cybersecurity is a key component of our enterprise risk oversight framework, with our Board of Directors actively engaged in overseeing cybersecurity risk management. While management is responsible for day-to-day cybersecurity operations, the Board ensures that our cybersecurity risk management strategies are effectively implemented.
Removed
The Vice President of Information Technology has over 30 years of experience in information technology, leading organizations through strategic technology and process improvement initiatives, including over 15 years of extensive experience in cybersecurity.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties On November 1, 2020, we executed a lease to relocate our corporate headquarters to office space located at 1900 Reston Metro Plaza in Reston, Virginia for a ten-year term.
Biggest changeItem 2. Properties In November 2020, we executed a lease to relocate our corporate headquarters to office space located at 1900 Reston Metro Plaza in Reston, Virginia for a ten-year term.
In January 2022, we executed a lease for a remote monitoring center for ParkX, our parking management subsidiary, and in November 2022 we executed a lease to expand our corporate headquarters, bringing the total amount of leased space to 25,630 square feet as of December 31, 2023.
In January 2022, we executed a lease for a remote monitoring center for ParkX, our parking management subsidiary, and in November 2022 we executed a lease to expand our corporate headquarters, bringing the total amount of leased space to 25,630 square feet as of December 31, 2024.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Our Class A common stock is traded on The Nasdaq Capital Market under the symbol “CHCI”. As of December 31, 2023, there were 37 registered holders of record of our Class A common stock and 1 holder of our Class B common stock.
Biggest changeItem 5. Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Our Class A common stock is traded on The Nasdaq Capital Market under the symbol “CHCI”. As of December 31, 2024, there were 34 registered holders of record of our Class A common stock and 1 holder of our Class B common stock.
We did not repurchase any securities under our share repurchase program or issue any unregistered securities during the year ended December 31, 2023. Item 6. [RESERVED] Not Applicable. 10 Table of Contents
We did not repurchase any securities under our share repurchase program or issue any unregistered securities during the year ended December 31, 2024. Item 6. [RESERVED] Not Applicable. 10 Table of Contents

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeAlthough the long-term impact of the COVID-19 pandemic on the greater Washington, D.C. area real estate market remains uncertain, we believe that our Anchor Portfolio is well positioned to withstand any future potential negative impacts. 13 Table of Contents Results of Operations The following tables set forth consolidated statement of operations data for the periods presented (in thousands): Year Ended December 31, 2023 2022 Revenue $ 44,721 $ 39,313 Operating costs and expenses: Cost of revenue 33,040 29,371 Selling, general, and administrative 2,305 1,784 Depreciation and amortization 212 206 Total operating costs and expenses 35,557 31,361 Income (loss) from operations 9,164 7,952 Other income (expense): Interest income (expense), net 96 (222) Gain (loss) on real estate ventures (1,187) 121 Other income (expense), net 79 2 Income (loss) from continuing operations before income tax 8,152 7,853 Provision for (benefit from) income tax 368 125 Net income (loss) from continuing operations 7,784 7,728 Net income (loss) from discontinued operations, net of tax — (381) Net income (loss) $ 7,784 $ 7,347 Impact of Series C preferred stock redemption — 2,046 Net income (loss) attributable to common stockholders $ 7,784 $ 9,393 Comparison of the Years Ended December 31, 2023 and 2022 Revenue The following table summarizes revenue by line of business (in thousands): Year Ended December 31, 2023 2022 Change Amount % Amount % $ % Asset management $ 29,278 65.5 % $ 26,680 67.9 % $ 2,598 9.7 % Property management 10,604 23.7 % 9,398 23.9 % 1,206 12.8 % Parking management 4,839 10.8 % 3,235 8.2 % 1,604 49.6 % Total revenue $ 44,721 100.0 % $ 39,313 100.0 % $ 5,408 13.8 % Revenue increased 13.8% in 2023.
Biggest changeOur commitment to this mission drives our ability to expand our managed portfolio of assets, grow revenue, and deliver value to our shareholders. 13 Table of Contents Results of Operations The following tables set forth consolidated statement of operations data for the periods presented (in thousands): Year Ended December 31, 2024 2023 Revenue $ 51,294 $ 44,721 Operating costs and expenses: Cost of revenue 38,630 33,040 Selling, general, and administrative 2,075 2,305 Depreciation and amortization 302 212 Total operating costs and expenses 41,007 35,557 Income (loss) from operations 10,287 9,164 Other income (expense): Interest income 672 96 Gain (loss) on real estate ventures (297) (1,187) Other income (expense), net 63 79 Income (loss) from operations before income tax 10,725 8,152 Provision for (benefit from) income tax (3,835) 368 Net income (loss) $ 14,560 $ 7,784 Comparison of the Years Ended December 31, 2024 and 2023 Revenue The following table summarizes revenue by line of business (in thousands): Year Ended December 31, 2024 2023 Change Amount % Amount % $ % Asset management $ 31,497 61.4 % $ 29,278 65.5 % $ 2,219 7.6 % Property management 11,612 22.6 % 10,604 23.7 % 1,008 9.5 % Parking management 8,185 16.0 % 4,839 10.8 % 3,346 69.1 % Total revenue $ 51,294 100.0 % $ 44,721 100.0 % $ 6,573 14.7 % Revenue increased 14.7% in 2024.
The two-building complex is the premier residential offering in Rockville Town Center.
The two-building complex is the premier residential offering in Rockville Town Center.
Our real estate development and asset management operations are primarily located in the greater Washington, D.C. area, where we believe our decades of experience provides us with the best opportunity to continue developing, managing, and investing in high-quality real estate assets and capitalizing on positive growth trends.
Our real estate development and asset management operations are primarily focused on the greater Washington, D.C. area, where we believe our decades of experience provides us with the best opportunity to continue developing, managing, and investing in high-quality real estate assets and capitalizing on positive growth trends.
We have determined we are not the primary beneficiary in these investments, and therefore do not consolidate them into our balance sheets as of December 31, 2023 and 2022 or into our statements of operations for the years ended December 31, 2023 and 2022.
We have determined we are not the primary beneficiary in these investments, and therefore do not consolidate them into our balance sheets as of December 31, 2024 and 2023 or into our statements of operations for the years ended December 31, 2024 and 2023.
In conjunction with the acquisition, we entered into a contingent fee agreement with BLVD 44 should these pursuits prove successful (See Note 14 in the Notes to Consolidated Financial Statements for additional information).
In conjunction with the acquisition, we entered into a contingent fee agreement with BLVD 44 should these pursuits prove successful (See Note 13 in the Notes to Consolidated Financial Statements for additional information).
Comstock 41 Operating Acquired in 2023, this 18,150 square foot parcel located at 41 Maryland Ave. in Rockville, Md. and is adjacent to BLVD Forty Four; currently a surface parking lot operated by ParkX Management, LC; provides an excellent opportunity for significant value enhancement through by-right entitlements for approximately 117 residential units Investors X Operating Investment in Comstock Investors X, LC that owns legacy homebuilding assets that are currently being monetized through market-rate sales expected to be completed in 2024 Parking Operating Commercial parking garages & spaces managed by ParkX Management, LC located at affiliated properties and third-party locations Comstock 41 - Additional Information Given its proximity to BLVD 44, we plan to explore rezoning opportunities at Comstock 41 that would allow for potential relocation of moderately-priced dwelling units from BLVD 44 to Comstock 41 as well as utilization of excess parking capacity at both BLVD 44 and BLVD Ansel.
Comstock 41 Operating Acquired in 2023, this 18,150 square foot parcel located at 41 Maryland Ave. in Rockville, Md. and is adjacent to BLVD Forty Four; currently a surface parking lot operated by ParkX Management, LC; provides an excellent opportunity for significant value enhancement through by-right entitlements for approximately 117 residential units Investors X Operating Investment in Comstock Investors X, LC that owns legacy homebuilding assets that were monetized through market-rate sales that were completed in March 2024 ParkX Operating Commercial parking garages & spaces managed by ParkX Management that are located at/around affiliated managed properties as well as a growing number of third-party locations Comstock 41 - Additional Information Given its proximity to BLVD 44, we plan to explore rezoning opportunities at Comstock 41 that would allow for potential relocation of moderately-priced dwelling units from BLVD 44 to Comstock 41 as well as utilization of excess parking capacity at both BLVD 44 and BLVD Ansel.
All references to “2023” and “2022” are referring to the twelve-month period ended December 31 for each of those respective fiscal years. This section of this Annual Report on Form 10-K generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022. The following discussion may contain forward-looking statements that reflect our plans and expectations.
All references to “2024” and “2023” are referring to the twelve-month period ended December 31 for each of those respective fiscal years. This section of this Annual Report on Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023. The following discussion may contain forward-looking statements that reflect our plans and expectations.
We distinguish ourselves from industry peers through an established standard of excellence that extends from who we hire to how we deliver our broad suite of real estate services.
We distinguish ourselves from industry peers through an established standard of excellence that extends from who we hire to how we deliver our comprehensive suite of real estate services.
As a result, we only recognize Incentive Fees at or near each asset's respective triggering event (as detailed in the 2022 AMA) when imputed profit could be reasonably calculated and relied upon to not materially change. For the years ended December 31, 2023 and 2022, we recognized revenue from Incentive Fees of $4.8 million and $3.9 million, respectively.
As a result, we only recognize Incentive Fees at or near each asset's respective triggering event (as detailed in the 2022 AMA) when imputed profit could be reasonably calculated and relied upon to not materially change. For the years ended December 31, 2024 and 2023, we recognized revenue from Incentive Fees of $1.5 million and $4.8 million, respectively.
While we believe that Adjusted EBITDA is useful to investors when evaluating our business, it is not prepared and presented in accordance with GAAP, and therefore should be considered supplemental in nature. Adjusted EBITDA should not be considered 15 Table of Contents in isolation, or as a substitute for other financial performance measures presented in accordance with GAAP.
While we believe that Adjusted EBITDA is useful to investors when evaluating our business, it is not prepared and presented in accordance with GAAP, and therefore should be considered supplemental in nature. Adjusted EBITDA should not be considered in isolation, or as a substitute for other financial performance measures presented in accordance with GAAP.
Our development pipeline currently includes 5 commercial assets that represent approximately 1.5 million square feet, 6 residential assets with 2,599 units that represent approximately 2.8 million square feet, and 1 hotel that will include 140 keys. At full build out, our managed portfolio of assets is currently projected to total 68 assets representing nearly 10 million square feet.
Our development pipeline currently includes 5 commercial assets that represent approximately 1.5 million square feet, 5 residential assets with 2,326 units that represent approximately 2.5 million square feet, and 1 hotel that will include 140 keys. At full build out, our managed portfolio of assets is currently projected to total 88 assets representing nearly 10 million square feet.
The following tables provide further details on our managed portfolio: Anchor Portfolio Name Status Description Reston Station Operating + Under Construction + In Development Among the largest mixed-use, transit-oriented developments in the Washington, D.C. region, covering nearly 90 acres spanning the Dulles Toll Road and surrounding the Wiehle Reston-East Metro Station and strategically located mid-way between Tysons, Va. and Dulles International Airport on Metro's Silver Line (Fairfax County, Va.) Loudoun Station Operating + In Development Loudoun County’s first fully integrated mixed-use, transit-oriented development located at the terminus station, Metro's Ashburn Station on the Silver Line in Ashburn, Va (Loudoun County, Va.) Herndon Station In Development Located in the Historic Downtown District of the Town of Herndon, Va., this planned mixed-use development is subject of a public-private partnership with the Town of Herndon Other Portfolio Assets Name Status Description The Hartford Operating Acquired in 2019, this 211,000 square foot mixed-use building is located adjacent to the Clarendon Station on Metro's Orange Line and is the subject of a joint venture with DivcoWest and Comstock Partners, LC.
The following tables provide further details on our managed portfolio: Anchor Portfolio Name Status Description Reston Station Operating + Under Construction + In Development Among the largest mixed-use, transit-oriented developments in the Washington, D.C. region, covering nearly 90 acres spanning the Dulles Toll Road and surrounding the Wiehle Reston-East Metro Station and strategically located mid-way between Tysons, Va. and Dulles International Airport on Metro's Silver Line (Fairfax County, Va.) Loudoun Station Operating + In Development Loudoun County’s first and only mixed-use, Metro-connected development that is located adjacent to Ashburn Station at the terminus of Metro's Silver Line in Ashburn, Va (Loudoun County, Va.) 12 Table of Contents Other Portfolio Assets Name Status Description The Hartford Operating Acquired in 2019, this 211,000 square foot mixed-use building is located adjacent to the Clarendon Station on Metro's Orange Line and is the subject of a joint venture with DivcoWest and Comstock Partners, LC.
In addition, we manage the following assets that are under construction and scheduled for delivery in the next 12 to 24 months: • 3 commercial assets that represent approximately 600,000 square feet; • 1 residential asset with 420 units representing approximately 430,000 square feet; 11 Table of Contents • 1 JW Marriott-branded hotel/condominium with 243 keys and 95 residential units representing a total of approximately 520,000 square feet; and • 2 commercial parking garages with approximately 2,900 spaces.
In addition, we manage the following assets that are under construction and scheduled for delivery in the next 12 to 24 months: • 2 commercial assets that represent approximately 266,000 square feet; • 1 residential asset with 420 units representing approximately 430,000 square feet; • 1 JW Marriott-branded hotel/condominium with 247 keys and 94 residential units representing a total of approximately 520,000 square feet; and • 1 commercial parking garages with approximately 1,300 spaces.
Incentive Fees are calculated as a percentage of the imputed profit that would be realized upon the hypothetical sale or recapitalization of the asset (or assets) for which triggering event criteria were met.
(See Note 13 for additional information). 17 Table of Contents Incentive Fees are calculated as a percentage of the imputed profit that would be realized upon the hypothetical sale or recapitalization of the asset (or assets) for which triggering event criteria were met.
Revenue - Incentive Fees Pursuant to the 2022 AMA, we are entitled to earn incentive compensation fees revenue ("Incentive Fees") on certain managed real estate assets if defined triggering events, which are differentiated based on the classification of the assets, are achieved. (See Note 14 for additional information).
Revenue - Incentive Fees Pursuant to the 2022 AMA, we are entitled to earn incentive compensation fees revenue ("Incentive Fees") on certain managed real estate assets if defined triggering events, which are differentiated based on the classification of the assets and defined in the agreement, are achieved.
Certain accounting policies, methods and estimates are particularly sensitive because of their significance to the consolidated financial statements and because of the possibility that future events affecting them may differ from management’s current judgments.
Those judgments are normally based on knowledge and experience with regard to past and current events and assumptions about future events. Certain accounting policies, methods and estimates are particularly sensitive because of their significance to the consolidated financial statements and because of the possibility that future events affecting them may differ from management’s current judgments.
(See Notes 10 and 14 in the Notes to Consolidated Financial Statements for additional information). Outlook We aspire to be among the most admired real estate asset managers, operators, and developers by creating extraordinary places, providing exceptional experiences, and generating excellent results for all stakeholders.
We aspire to be among the most admired real estate asset managers, operators, and developers by creating extraordinary places, providing exceptional experiences, and generating excellent results for all stakeholders.
We employ a talented staff of real estate professionals that are led by our seasoned management team and are tasked with delivering high-quality services to the premium, strategically located assets in our managed portfolio. We primarily operate under long-term asset management and property management agreements that provide recurring fee-based revenue streams.
We employ a talented staff of real estate professionals that are led by our seasoned management team and are tasked with delivering high-quality services to the premium, strategically located assets in our managed portfolio.
Non-GAAP Financial Measures To provide investors with additional information regarding our financial results, we prepare certain financial measures that are not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”), specifically Adjusted EBITDA.
As of December 31, 2024, we had $111.1 million of net operating loss (“NOL") carryforwards. Non-GAAP Financial Measures To provide investors with additional information regarding our financial results, we prepare certain financial measures that are not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”), specifically Adjusted EBITDA.
The $4.2 million comparative increase was primarily due to a $2.6 million increase in personnel expenses from increased headcount and employee compensation.
The $5.5 million comparative increase was primarily due to a $3.6 million increase in personnel expenses from increased headcount and employee compensation and a net $1.9 million increase in reimbursable/billable expenses.
As a vertically integrated real estate services company, we perform all property management services through three wholly owned subsidiaries: CHCI Commercial, CHCI Residential, and ParkX Management ("ParkX"). All properties included in our managed portfolio have entered into property management agreements with our operational subsidiaries that provide for market-rate fees related to our services.
We provide asset management services for market-rate fees to all the commercial and residential assets in our managed portfolio, as well as to certain assets managed by ParkX (see below). • As a vertically integrated real estate services company, we perform all property management services through three wholly owned subsidiaries: CHCI Commercial, CHCI Residential, and ParkX Management ("ParkX").
Accounting policies, methods and estimates are an integral part of the preparation of consolidated financial statements in accordance with U.S. GAAP and, in part, are based upon management’s current judgments. Those judgments are normally based on knowledge and experience with regard to past and current events and assumptions about future events.
Critical Accounting Policies and Estimates Our consolidated financial statements are prepared in accordance with GAAP. Accounting policies, methods and estimates are an integral part of the preparation of consolidated financial statements in accordance with U.S. GAAP and, in part, are based upon management’s current judgments.
Liquidity and Capital Resources Liquidity is defined as the current amount of readily available cash and the ability to generate adequate amounts of cash to meet the current needs for cash. We assess our liquidity in terms of our cash and cash equivalents on hand and the ability to generate cash to fund our operating activities.
Seasonality and Quarterly Fluctuations None. Liquidity and Capital Resources Liquidity is defined as the current amount of readily available cash and the ability to generate adequate amounts of cash to meet the current needs for cash.
For the years ended December 31, 2023 and 2022, we recorded net decreases to our deferred tax valuation allowance of $1.5 million and $1.1 million, respectively. Item 7A. Quantitative and Qualitative Disclosures About Market Risk Not applicable. 18 Table of Contents
For the years ended December 31, 2024 and 2023, we recorded net decreases to our deferred tax valuation allowance of $6.5 million and $1.5 million, respectively.
We determine primary beneficiary status of a VIE at the time of investment and perform ongoing reassessments to evaluate whether changes in the entity’s capital structure or changes in the nature of its involvement with the entity result in a change to the VIE designation or a change to its consolidation conclusion. 17 Table of Contents We have minority voting and economic interests in our investments in real estate ventures that we have elected to report at fair value and do not control the activities that most significantly impact their economic performance.
We determine primary beneficiary status of a VIE at the time of investment and perform ongoing reassessments to evaluate whether changes in the entity’s capital structure or changes in the nature of its involvement with the entity result in a change to the VIE designation or a change to its consolidation conclusion.
We are able maintain this high standard because We Show Up - every day, in person, in a collaborative environment that is structured to deliver on our mission to make a difference for our customers, our stakeholders, and in the communities that we serve.
We are able to maintain this high standard because We Show Up - every day, in person, in a collaborative environment that is structured to deliver on our mission to make a difference for our customers, our stakeholders, and in the communities that we serve. 11 Table of Contents Managed Portfolio The focus of our managed portfolio revolves primarily around high quality, mixed-use real estate properties and developments that are strategically located adjacent to Metro rail stations, providing convenient access to public transportation.
Cash Flows The following table summarizes our cash flows for the periods indicated (in thousands): Year Ended December 31, 2023 2022 Change ($) Continuing operations Net cash provided by (used in) operating activities $ 9,003 $ 8,397 $ 606 Net cash provided by (used in) investing activities (1,547) (2,099) 552 Net cash provided by (used in) financing activities (390) (10,068) 9,678 Total net increase (decrease) in cash - continuing operations 7,066 (3,770) 10,836 Discontinued operations, net — (331) 331 Net increase (decrease) in cash and cash equivalents $ 7,066 $ (4,101) $ 11,167 16 Table of Contents Operating Activities The $0.6 million variance in net operating cash activity was primarily driven by a $1.9 million increase in net income from continuing operations after adjustments for non-cash items, partially offset by a $1.3 million incremental cash outflow stemming from changes to our net working capital that was primarily due to decreased accrued personnel costs.
Cash Flows The following table summarizes our cash flows for the periods indicated (in thousands): Year Ended December 31, 2024 2023 Change Net cash provided by (used in) operating activities $ 10,675 $ 9,003 $ 1,672 Net cash provided by (used in) investing activities (350) (1,547) 1,197 Net cash provided by (used in) financing activities (352) (390) 38 Net increase (decrease) in cash and cash equivalents $ 9,973 $ 7,066 $ 2,907 Operating Activities The $1.7 million variance in net operating cash activity was primarily driven by a $1.7 million increase in net income from continuing operations after adjustments for non-cash items.
The $5.4 million comparative increase was primarily driven by the continued expansion of our managed portfolio, which included 8 additional assets in 2023. Recurring asset management and property management fee-based revenue increased by a combined $3.0 million, or 12.6%, and reimbursable staffing charges increased $2.1 million, or 25.3%.
The $6.6 million comparative increase was primarily driven by a $4.8 million, or 101.4%, increase in recurring, fee-based revenue from our property and parking management services due to the continued expansion of our managed portfolio.
Our primary capital needs are for working capital obligations and other general corporate purposes, including investments and capital expenditures. Our primary sources of working capital are cash from operations and distributions from investments in real estate ventures. We have historically financed our operations with internally generated funds and borrowings from our credit facilities.
Our primary sources of working capital are cash from operations and distributions from investments in real estate ventures. We have historically financed our operations with internally generated funds and, more rarely and only when necessary, borrowings from our Credit Facility. We believe we currently have adequate liquidity and availability of capital to fund our present operations.
Our asset management services platform is anchored by a long-term, full-service asset management agreement with an affiliate that includes a cost-plus fee structure and covers all of the properties in our Anchor Portfolio (the "2022 AMA" - see below for additional details).
We primarily operate under long-term asset management and property management agreements that provide recurring fee-based revenue streams. • Our asset management services platform is anchored by a long-term, full-service asset management agreement with Comstock Partners, LC ("CP"), an affiliate entity controlled by our Chief Executive Officer Christopher Clemente, which includes a cost-plus fee structure and covers all of the properties in our Anchor Portfolio (the "2022 AMA" - See Note 13 in the Notes to Consolidated Financial Statements for additional information).
The following table presents a reconciliation of net income (loss) from continuing operations, the most directly comparable financial measure as measured in accordance with GAAP, to Adjusted EBITDA (in thousands): Year Ended December 31, 2023 2022 Net income (loss) from continuing operations $ 7,784 $ 7,728 Interest (income) expense, net (96) 222 Income taxes 368 125 Depreciation and amortization 212 206 Stock-based compensation 968 834 (Gain) loss on real estate ventures 1,187 (121) Adjusted EBITDA $ 10,423 $ 8,994 Seasonality and Quarterly Fluctuations None.
Adjusted EBITDA may differ from similarly titled measures presented by other companies. 15 Table of Contents The following table presents a reconciliation of net income (loss), the most directly comparable financial measure as measured in accordance with GAAP, to Adjusted EBITDA (in thousands): Year Ended December 31, 2024 2023 Net income (loss) $ 14,560 $ 7,784 Interest income (672) (96) Income taxes (3,835) 368 Depreciation and amortization 302 212 Stock-based compensation 945 968 (Gain) loss on real estate ventures 297 1,187 Adjusted EBITDA $ 11,597 $ 10,423 The increases in Adjusted EBITDA for the year ended December 31, 2024 were primarily driven by significant increases in recurring fee-based property and parking management revenue and supplemental asset management fee revenue.
Other income (expense) The following table summarizes other income (expense) (in thousands): Year Ended December 31, Change 2023 2022 $ % Interest income (expense), net $ 96 $ (222) $ 318 (143.2) % Gain (loss) on real estate ventures (1,187) 121 (1,308) N/M Other income (expense), net 79 2 77 N/M Total other income (expense) $ (1,012) $ (99) $ (913) N/M Other income (expense) changed by $(0.9) million in 2023, primarily driven by primarily driven by a $1.3 million net decrease in mark-to-market valuations of equity method investments in real estate ventures, primarily due to the increased interest rate environment.
Other income (expense) The following table summarizes other income (expense) (in thousands): Year Ended December 31, Change 2024 2023 $ % Interest income $ 672 $ 96 $ 576 600.0 % Gain (loss) on real estate ventures (297) (1,187) 890 (75.0) % Other income (expense), net 63 79 (16) (20.3) % Total other income (expense) $ 438 $ (1,012) $ 1,450 (143.3) % Other income (expense) changed by $1.5 million in 2024, primarily driven by primarily driven by a combined $0.9 million improvement in mark-to-market valuation impacts of equity method investments in real estate ventures and a $0.6 million increase in interest income stemming from interest earned on money market sweep accounts that were not active for all of 2023.
Our asset-light, debt-free business model allows us to substantially mitigate risks that are typically associated with real estate development and operation. The fee-based approach we have adopted helps drive consistent, predictable top-line growth and provides us with a streamlined balance sheet that grants us maximum flexibility to explore potential growth opportunities outside of our core business operations.
The fee-based approach we have adopted helps drive consistent top-line growth that, along with our streamlined balance sheet, provides maximum flexibility to explore growth opportunities outside of our core business operations. We have directly aligned the equity ownership of our Company with the ownership interests of the affiliated assets that we manage in our Anchor Portfolio.
Managed Portfolio The following table summarizes the operating assets that are included in our managed portfolio: Type # of Assets Size/Scale % Leased Commercial 13 2.0 million sqft. 92% Residential 6 1.8 million sqft. / ~1,700 units 97% Parking 30 1 18,000+ spaces Total 49 1 Total includes 13 commercial parking garages owned by unaffiliated parties and managed by ParkX.
The following table summarizes the operating assets that are included in our managed portfolio as of December 31, 2024: Type # of Assets Size/Scale % Leased Commercial (1) 14 2.3 million sqft. 82% Residential 6 1.8 million sqft. / ~1,700 units 96% ParkX - Garages 32 22,000+ spaces ParkX - Security & Other (2) 20 ~2,500 hrs/week Total 72 (1) Commercial % leased includes Q1 2024 delivery of a new office tower located in The Row at Reston Station.
Our principal sources of liquidity as of December 31, 2023, were our cash and cash equivalents of $18.8 million and our $10.0 million of available borrowings on our Credit Facility. Significant factors which could affect future liquidity include the adequacy of available lines of credit, cash flows generated from operating activities, working capital management and investments.
We assess our liquidity in terms of our cash and cash equivalents on hand and the ability to generate cash to fund our operating activities. Our principal sources of liquidity as of December 31, 2024, were our cash and cash equivalents of $28.8 million and our $10.0 million of available borrowings on our Credit Facility.
Incentive fee revenue also increased 22.7% to $4.8 million, however that increase was offset by a $0.8 million decrease in supplemental leasing, acquisition, and development fee revenue due to higher transactional volume in 2022. 14 Table of Contents Operating costs and expenses The following table summarizes operating costs and expenses (in thousands): Year Ended December 31, Change 2023 2022 $ % Cost of revenue $ 33,040 $ 29,371 $ 3,669 12.5 % Selling, general, and administrative 2,305 1,784 521 29.2 % Depreciation and amortization 212 206 6 2.9 % Total operating costs and expenses $ 35,557 $ 31,361 $ 4,196 13.4 % Operating costs and expenses increased 13.4% in 2023.
Operating costs and expenses The following table summarizes operating costs and expenses (in thousands): Year Ended December 31, Change 2024 2023 $ % Cost of revenue $ 38,630 $ 33,040 $ 5,590 16.9 % Selling, general, and administrative 2,075 2,305 (230) (10.0) % Depreciation and amortization 302 212 90 42.5 % Total operating costs and expenses $ 41,007 $ 35,557 $ 5,450 15.3 % 14 Table of Contents Operating costs and expenses increased 15.3% in 2024.
We believe that we are properly staffed for current market conditions and feel that we will maintain the ability to manage risk and pursue additional growth across each of our operational subsidiaries. Given current market conditions, we feel more opportunities to acquire distressed properties at below market prices may arise.
Outlook Our management team is committed to executing our goal to provide exceptional experiences to those we do business with while maximizing shareholder value. We believe that we are properly staffed for current and foreseeable market conditions and will maintain the ability to manage risk and pursue additional growth as opportunities arise.
Investing Activities The $0.6 million variance net investing cash activity was primarily driven by a $1.1 million decrease in investments in real estate ventures and a $0.4 million decrease in fixed asset purchases, partially offset by $1.0 million in proceeds received from the CES divestiture that was finalized in the first quarter of fiscal year 2022.
The comparative net changes to our net working capital balances were immaterial. 16 Table of Contents Investing Activities The $1.2 million variance in net investing cash activity was primarily driven by a $1.4 million decrease in investments in real estate ventures, partially offset by a $0.4 million increase in purchases of securities to fund non-qualified deferred compensation plan liabilities.
Removed
We intend to maintain a limited financial role in any future development activities that may occur at this site and plan to only offer fee-based development and asset management services to any affiliate or suitable third-party financial sponsor of any potential future developments. 12 Table of Contents Significant Developments CES Divestiture On March 31, 2022, we completed the sale of Comstock Environmental Services, LLC ("CES"), a wholly owned subsidiary, to August Mack Environmental, Inc.
Added
We have entered into separate asset management agreements for non-Anchor Portfolio assets.
Removed
("August Mack"). This strategic divestiture was based on the continued growth and future prospects of our asset management business. Accordingly, we have reflected CES as a discontinued operation in our consolidated financial statements for all periods presented, and unless otherwise noted, all amounts and disclosures relate solely to our continuing operations.
Added
All properties in our managed portfolio have entered into property management agreements that provide for market-rate fees related to our services. Our asset-light, debt-free business model allows us to substantially mitigate risks that are typically associated with real estate development and operation.
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(See Note 3 in the Notes to Consolidated Financial Statements for additional information). Series C Preferred Stock Redemption and 2022 Asset Management Agreement On June 13, 2022, we completed two separate significant transactions to further deleverage our balance sheet and enhance our long-term revenue outlook and growth potential.
Added
This relationship, along with the baseline cost-plus feature and supplemental performance-based revenue opportunities provided by the 2022 AMA, provides us with a stable business platform on which we can (i) produce consistent, positive financial results, (ii) mature and expand our real estate service offerings, (iii) diversify and grow our managed portfolio of assets, both organically and through additional third-party relationships, (iv) pursue strategic investments and complimentary acquisitions, and (v) deliver exceptional value to our shareholders.
Removed
The first one with CP Real Estate Services, LC (“CPRES”), an entity owned by Christopher Clemente, Comstock’s Chief Executive Officer, redeemed all outstanding Series C preferred stock at a significant discount to carrying value. Secondly, we executed a new asset management agreement with Comstock Partners, LC ("CP"), an entity controlled by Mr. Clemente and wholly owned by Mr.
Added
Our Anchor Portfolio (see below for details) includes, or will soon include, millions of square feet of Trophy and Class A office towers, luxury multi-family residential buildings, luxury hotels with branded condominium residences, high-end retail and entertainment options, associated public spaces, and commercial parking garages to serve all the properties.
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Clemente and certain family members, which covers our Anchor Portfolio of assets (the "2022 AMA").
Added
In 2024, Anchor portfolio assets generated a well over $100.0 million of gross revenue for the property owners.
Removed
The 2022 AMA increased the base fees we collect, expanded the services that qualify for additional supplemental fees, extended the term through 2035, and most notably introduced a mark-to-market incentive fee based on the imputed profit of Anchor Portfolio assets, generally as each is stabilized and as further specified in the agreement.
Added
Excluding that impact, the % leased for stabilized assets is 93%. (2) # of assets total excludes 12 properties where both parking & other services are provided to avoid double-counting.
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Our commitment to this mission drives our ability to expand our managed portfolio of assets, grow revenue, and deliver value to our shareholders.
Added
In November 2024, we entered into a definitive purchase agreement for Comstock 41 with SCG Development Holdings, LLC ("SCG") that is contingent upon the successful rezoning of the property to allow for the development of an affordable housing project at the site.
Removed
We plan to pursue further expansion of our wholly owned property management subsidiaries to increase recurring, fee-based revenue streams as we continue to develop additional relationships with new customers that require the expert real estate asset management, development management, construction management and other services that we routinely provide.
Added
Upon closing, we will enter into an operating agreement and a development agreement with SCG, under which we will provide construction management services for the affordable housing project that will be fully financed by SCG. We will also be entitled to provide property management services once the development is ready for occupancy.
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We remain well-positioned to capitalize on such opportunities due to our asset-light, debt-free business model that has strengthened our balance sheet and provided us with the flexibility to pursue unique growth opportunities across all facets of our vertically integrated operating platform. COVID-19 Update On May 11, 2023, the U.S.
Added
Our growth will continue to be fueled by our Anchor Portfolio, which will continue to generate revenue as development and construction efforts are completed for all the planned Anchor Portfolio assets, allowing us to then lease, stabilize, and arrange permanent financing for each property.
Removed
Department of Health and Human Services declared an end to the public health emergency for COVID-19. While we never experienced any significant impacts on our business resulting from COVID-19, future regional or global health emergencies may have a negative impact on our results of operations and financial condition.
Added
Importantly, the long-term asset management agreements covering the properties included in the Anchor Portfolio, when combined with our asset-light and debt-free business model, provide us with visibility to future revenue and earnings growth while mitigating the risk for potential losses.
Removed
Also driving the variance were a $0.4 million increase in rent expense stemming from the corporate headquarters lease expansion that was executed in 2022, a $0.3 million increase in regulatory and compliance costs, and a $0.2 million increase in IT expenditures.
Added
Also contributing to the increase was $3.1 million of additional supplemental fees stemming from leasing activity and refinancing fees, as well as a $1.8 million increase in fee-based asset management services. Partially offsetting these increases was a $3.3 million decrease in incentive fees earned.
Removed
The decrease was partially offset by a $0.3 million increase in interest income (expense) that stemmed from interest earned on money market sweep accounts in 2023 and the full pay down of our outstanding debt in 2022. Income taxes Provision for income tax was $0.4 million in 2023, compared to 0.1 million in 2022.
Added
A previously scheduled October 1, 2024 incentive fee trigger event for seven specified managed portfolio assets was deferred. (See Note 13 in the Notes to Consolidated Financial Statements for additional information).
Removed
The $0.3 million increase was primarily due to higher pre-tax book income given that valuation allowance releases and the net total of book-to-tax adjustments were comparatively flat. As of December 31, 2023, we had $122.8 million of net operating loss (“NOL") carryforwards.
Added
Income taxes We recorded a $3.8 million income tax benefit in 2024, compared to a provision for income tax of $0.4 million in 2023. The $4.2 million net change was primarily driven by a $6.5 million valuation allowance release in the current period, partially offset by the impact of higher taxable income from operations.
Removed
Adjusted EBITDA may differ from similarly titled measures presented by other companies.
Added
(See Note 6 in the Notes to Consolidated Financial Statements for additional information). Significant factors which could affect future liquidity include the adequacy of available lines of credit, cash flows generated from operating activities, working capital management and investments. Our primary capital needs are for working capital obligations and other general corporate purposes, including investments and capital expenditures.
Removed
(See Note 7 in the Notes to Consolidated Financial Statements for additional information). We believe we currently have adequate liquidity and availability of capital to fund our present operations and meet our commitments on our existing debt.
Added
Financing Activities The immaterial variance in net financing cash activity was primarily driven by $0.2 million of proceeds in conjunction with the issuance of common stock related to equity awards, which was almost entirely offset by a $0.2 million increase in cash paid for taxes related to the net share settlement of equity awards.
Removed
Financing Activities The $9.7 million variance in net financing cash activity was primarily driven by a $4.0 million cash payment made in 2022 related to the early redemption of Series C Preferred Stock and a $5.5 million payment made in 2022 to satisfy the outstanding balance of our credit facility.
Added
We have minority voting and economic interests in our investments in real estate ventures that we have elected to report at fair value and do not control the activities that most significantly impact their economic performance.
Removed
Off-Balance Sheet Arrangements From time to time, we may have off-balance-sheet unconsolidated investments in real estate ventures and other unconsolidated arrangements with varying structures. (See Note 5 in the Notes to Consolidated Financial Statements for additional information). Critical Accounting Policies and Estimates Our consolidated financial statements are prepared in accordance with GAAP.
Removed
These operating asset triggering events are part of a series of annual operating asset triggering events that began on October 1, 2022, and are scheduled each October 1 through 2024.
Removed
Subsequent to these scheduled triggering events, and in accordance with terms pursuant to the 2022 AMA, incentive fees may be recognized on assets currently under development upon the achievement of future triggering events tied to various metrics that indicate stabilization, such as occupancy and leasing rates. (See Note 14 in the Notes to Consolidated Financial Statements for additional information).

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