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ACQUISITIONS
 6 Months Ended
Jun. 30, 2026
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
ACQUISITIONS ACQUISITIONS
On July 31, 2025 (the “Acquisition Date”), the Company acquired substantially all of the assets associated with the residential asset management business of Hearthstone, Inc., a provider of capital solutions to the U.S. homebuilding industry, by purchasing 75% of the outstanding Class A units of HRH for an all cash purchase price of $57.6 million. This acquisition positions the Company as an active manager of capital solutions for the homebuilding industry primarily through land banking.
The acquisition was accounted for as a business combination under ASC Topic 805, Business Combinations (“ASC 805”).
The following table summarizes the amounts recognized for the estimated fair value of the assets acquired, liabilities assumed and noncontrolling interests of the Hearthstone Venture and resulting goodwill as of the Acquisition Date (in thousands):
Consideration$57,562 
Recognized amounts of identifiable assets acquired and liabilities assumed
Cash and cash equivalents2,255 
Related party receivables and contract assets10,653 
Investment in funds16,508 
Intangible assets13,672 
Other assets1,113 
Total assets44,201 
Accounts payable and other liabilities12,209 
Total liabilities12,209 
Net identifiable assets acquired31,992 
Goodwill69,812 
Net assets acquired101,804 
Less: redeemable noncontrolling interests in the Hearthstone Venture44,242 
$57,562 
A third-party valuation specialist assisted the Company in estimating the fair values of the assets acquired, liabilities assumed and noncontrolling interests in the Hearthstone Venture. The identifiable intangible assets acquired include investor relationships and joint venture projects, which were valued at $7.3 million and $6.4 million, respectively. The fair values of these intangible assets were determined using income-based valuation approaches, specifically the multi-period excess earnings method. The investor relationships intangible asset was valued based on projected revenue growth and estimated attrition rates of existing investors, while the joint venture projects intangible asset was valued based on projected net revenue from existing joint venture contracts. The estimated remaining useful lives of both intangible assets are seven years.
The fair value of the noncontrolling interests (see Note 6) was based on the stated unit values, which the Company determined approximated fair value, and discounted cash flow analyses. These fair value measurements are based on significant inputs that are not observable in the market and thus represent a fair value measurement categorized within Level 3 of the fair value hierarchy. Key assumptions include discount rates consistent with expected returns on comparable private real estate funds ranging from 15% to 20%.
Goodwill primarily represents the value of expected operational synergies, enhanced scale and market presence, the assembled workforce, and other intangible benefits expected to be realized from integrating the Hearthstone Venture platform with the Company’s existing operations. The Company expects $39.8 million, the portion of goodwill attributable to its ownership interest, will be deductible for tax purposes. All of the goodwill was assigned to the Hearthstone segment. At June 30, 2026, the carrying value of goodwill was $69.8 million.
Unaudited Pro Forma
The following table presents the Company’s unaudited pro forma consolidated revenues and net income for the three and six months ended June 30, 2025 as if the Hearthstone Venture acquisition had occurred on January 1, 2025 (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
20252025
Revenues$11,933 $29,906 
Net income$9,237 $69,877 
These amounts have been calculated after applying the Company’s accounting policies, including acquisition costs in the earnings of the earliest period and adjusting the results of the Hearthstone Venture to reflect amortization for intangible assets and tax effects.