RELATED PARTY TRANSACTIONS |
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| RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Related party assets and liabilities included in the Company’s condensed consolidated balance sheets as of June 30, 2026 and December 31, 2025 consisted of the following (in thousands):
Development Management Agreement with the Great Park Venture (Incentive Compensation Contract Asset) In 2010, the Great Park Venture, the Company’s equity method investee, engaged the Management Company under a development management agreement to provide management services to the Great Park Venture. The compensation structure in place consists of a base fee and incentive compensation. Incentive compensation is 9% of distributions available to be made by the Great Park Venture to its percentage interest holders. In December 2022, the Company and the Great Park Venture entered into a second amendment to the A&R DMA establishing the terms of service through December 31, 2024 (the “First Renewal Term”). In September 2024, the Company and the Great Park Venture entered into a third amendment to the A&R DMA. Under the third amendment, the term of the A&R DMA was renewed through December 31, 2026 (the “Second Renewal Term”). If the A&R DMA is not extended by mutual agreement of the parties beyond December 31, 2026 and the Company is no longer providing management services subsequent to December 31, 2026, the Company will be entitled to 6.75% of distributions paid thereafter. During the six months ended June 30, 2026 and 2025, the Great Park Venture made incentive compensation payments of $9.3 million and $30.4 million, respectively, to the Company. The Company recognized revenue from management services of $9.1 million and $16.0 million for the three and six months ended June 30, 2026, respectively, and $7.0 million and $19.5 million for the three and six months ended June 30, 2025, respectively, related to management fees under the A&R DMA, and such revenues are included in management services—related party in the accompanying condensed consolidated statements of operations and are included in the Great Park segment. At June 30, 2026 and December 31, 2025, included in contract assets in the table above is $72.1 million and $76.3 million, respectively, attributed to incentive compensation revenue recognized but not yet due (see Note 4), and included in other related party liabilities is $0.9 million and $5.1 million, respectively, attributed to payments received for incentive compensation revenue not yet recognized (see Note 4). Operating Agreements with Hearthstone Funds (Performance Fee Contract Asset) The Hearthstone Venture manages the operations and assets of the Hearthstone Funds and is entitled to receive asset management fees and in some cases performance fees from those funds upon the achievement of certain performance hurdles. During the three and six months ended June 30, 2026, the Hearthstone Venture recognized performance fee revenue of $0.5 million and $1.7 million, respectively, and at June 30, 2026 and December 31, 2025, included in contract assets in the table above is $12.1 million and $10.4 million, respectively, attributed to performance fee revenue recognized but not yet due (see Notes 3 and 4). Reimbursement Obligation The San Francisco Venture has entered into reimbursement agreements for which it has agreed to reimburse an affiliate of Lennar for a portion of the EB-5 loan liabilities and related interest that were assumed by an affiliate of Lennar in connection with the Formation Transactions. Pursuant to a reimbursement deferral agreement with an affiliate of Lennar, principal and interest payments under the related party reimbursement obligation were deferred from October 2023 through December 31, 2025. During the six months ended June 30, 2026, the Company paid $42.2 million in principal and $6.4 million in accrued and current interest.
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