Comstock Homebuilding reports Q1 profit of US$3.9M compared with net loss a year earlier of US$1M, reflecting positive impact of diversified platform with sale of first investment grade apartment property
May 11, 2012
– Diversified Platform Yields Results With Sale of First Investment Grade Apartment Property
Company Generates Net Earnings of $0.19 Per Diluted Share
Comstock Homebuilding Companies, Inc. (Nasdaq:CHCI) ("Comstock" or the "Company"), a multi-faceted real estate development and services company focused on the Washington, D.C. metropolitan area, announced net earnings for its first quarter ended March 31, 2012 of $3.9 million or $0.19 per diluted share, compared to a net loss for its first quarter ended March 31, 2011 of $(1.0) million or $(0.05) loss per diluted share. The 2012 first quarter earnings reflect the positive impact of Comstock's diversified platform as a result of the first sale of an investment grade property developed by the Company.
Notable Events and Accomplishments
On March 7, 2012, the Company closed on the sale of its 103-unit Cascades Apartments project for $19.35 million, recognizing a gain of $6.5 million from the sale. At settlement, the Company received net proceeds of approximately $4.7 million from the transaction after repayment of the construction loan provided by Cardinal Bank, retirement of the $2.9 million non-controlling equity investment related to the project, and the escrowing of approximately $0.95 million of customary and usual warranty and performance reserves. The Company expects the escrowed funds released to the Company prior to year-end 2012.
The Company announced that its Homebuilding unit, Comstock Homes of Washington, LC, has acquired the rights to develop a new townhome style condominium project in Loudoun County, Virginia. Eastgate One is a 66-unit subdivision situated within the 400-unit Eastgate planned community located in Chantilly, Virginia. The Company will purchase finished lots on a takedown schedule commencing in mid-2012. Initial unit pricing is expected to start in the high $200's. Eastgate One is proximate to the major employment areas in Loudoun County and Fairfax County. Amenities will include a centrally located recreation center that includes a clubhouse and pool.
The Company announced that during the first quarter its Homebuilding unit secured building permits and commenced construction of the first model home at The Hampshires, a 110-unit new home community located within the Lamond-Riggs neighborhood in the Northeast quadrant of Washington, D.C. The Hampshires is located proximate to two Metro rail stations just inside the Washington, D.C.-Maryland border. Sales of the 38 single-family homes and 73 townhomes at The Hampshires are expected to commence in mid-2012 with prices expected to start from the $400's for the townhomes and the $600's for the single-family homes.
The Board of Directors approved an amendment to the Company's Certificate of Incorporation effecting a corporate name change from Comstock Homebuilding Companies, Inc. to Comstock Holding Companies, Inc. The corporate name change is being implemented to better reflect the diverse nature of the Company's operating platform that includes homebuilding, development of Class-A apartment communities, mixed-use development, asset management and construction related services.
"We continue to execute our strategy of capitalizing on varied real estate development opportunities in the best real estate market in the nation," said Christopher Clemente, Chairman and CEO. "The sale of our Cascades Apartment project gets 2012 off to a good start and demonstrates the ability of our diversified platform to contribute to the bottom line as we focus on returning Comstock to ongoing profitability. Our improved liquidity and balance sheet has enhanced our ability to pursue additional attractive opportunities and we look forward to a successful 2012."
About Comstock Homebuilding Companies, Inc.
Comstock is a multi-faceted real estate development and services company. Our substantial experience in building a diverse range of products including apartments, single-family homes, townhouses, mid-rise condominiums, high-rise condominiums and mixed-use (residential and commercial) developments has positioned Comstock as a prominent real estate developer and homebuilder in the Washington, D.C. metropolitan area. Comstock Homebuilding Companies, Inc. trades on the NASDAQ Capital Market exchange under the symbol CHCI. For more information on the Company or its projects please visit www.comstockhomebuilding.com