Related Party Transactions |
6 Months Ended |
|---|---|
Jun. 30, 2025 | |
| Related Party Transactions | |
| Related Party Transactions | Note 11. Related Party Transactions Southland occasionally enters into subcontracts with a subcontractor in which certain employees hold a minority ownership. Cost of construction related to this subcontractor was $0.7 million and $0.4 million for the three months ended June 30, 2025 and 2024, respectively, and $1.6 million and $1.5 million for the six months ended June 30, 2025 and 2024, respectively. Accounts payable balance due to this subcontractor was $2.7 million and $0.4 million as of June 30, 2025 and December 31, 2024, respectively. The terms on which Southland enters into agreements with this related party are substantially the same as terms the Company would enter into with a similar, unrelated party. In the second quarter of 2024 the Company exchanged $13.1 million of amounts due to certain Southland Members for $13.1 million in promissory notes with a three-year term bearing an interest rate of 7.0%. These promissory notes pay interest monthly and are included in long-term debt. These amounts are related to balances due to the Chief Executive Officer Frank Renda and Co-Chief Operating Officers Tim Winn and Rudy Renda prior to the Merger. In December 2024, the Company exchanged the remaining outstanding balance of these promissory notes and accrued interest thereupon due in exchange for shares of common stock. In July 2024, the Company closed a real estate purchase agreement to sell and leaseback three properties for $42.5 million. The Company’s Chief Executive Officer, Frank Renda, and co-Chief Operating Officer, Rudy Renda, hold a combined 25% indirect minority interest in the entity that purchased the real estate. During the year ended December 31, 2024, the Company paid $2.0 million to this related party in accordance with the real estate purchase agreement.
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