Stratus Properties Inc.
10/06/2025 | Press release | Distributed by Public on 10/06/2025 15:06
Material Agreement (Form 8-K)
Item 1.01. Entry into a Material Definitive Agreement.
On September 30, 2025, The Saint June, L.P. (the Partnership), a Texas limited partnership and 34.13% owned subsidiary of Stratus Properties Inc. (Stratus), as borrower, Stratus, as guarantor, Texas Capital Bank, as administrative agent, and each of the lenders party thereto, entered into an Amendment to Loan Agreement and related agreements effective as of September 30, 2025 (the Amendments), which amend that certain Loan Agreement dated June 2, 2021 by and between the Partnership, Texas Capital Bank and each of the lenders party thereto, each as previously amended (collectively and as amended, the Loan Agreements) and the related Guaranty Agreement by Stratus. The Loan Agreements provide for a construction loan (as amended, the Loan) to finance a portion of the cost of the development and construction of The Saint June, a 182-unit luxury garden-style multi-family project within the Amarra development in Barton Creek, located in Austin, Texas. Construction of The Saint June was completed in fourth-quarter 2023.
The Amendments (i) extend the maturity date of the Loan to October 2, 2027; (ii) provide for advances of an additional $1.5 million, bringing the outstanding principal balance of the Loan to $32.9 million with no funds remaining available for additional principal advances; (iii) decrease the interest rate applicable margin from 2.35% to 2.00%; (iv) eliminate the requirement to make monthly principal payments prior to maturity; and (v) add a new property-level minimum debt yield financial covenant, which replaces the existing property-level debt service coverage ratio. If the debt yield financial covenant is not met, the principal balance of the Loan must be paid down in an amount sufficient to achieve the minimum debt yield. The Amendments permit the Partnership to distribute up to $1.5 million to the partners.
Accordingly, the Loan bears interest at the one-month Term Secured Overnight Financing Rate plus 2.00%, subject to a 3.50% floor. Payments of interest only on the Loan are due monthly with the outstanding principal due at maturity. After closing costs, the Partnership intends to use the remaining portion of the $1.5 million proceeds of the Loan to establish reserves for Partnership expenses and make cash distributions to the partners.
The Loan is secured by The Saint June project and was fully guaranteed by Stratus. However, the guaranty converted to a 50% repayment guaranty upon completion of construction of The Saint June and, as amended, will remain in effect for the duration of the Loan. Notwithstanding the foregoing, Stratus will remain liable for customary carve-out obligations and environmental indemnity.
The foregoing description of the Amendments is not intended to be complete and is qualified in its entirety by reference to the full text of the Amendments, copies of which are attached hereto as Exhibits 10.1 and 10.2 and incorporated by reference into this Item 1.01.
Item 8.01. Other Events.
As previously disclosed, Stratus and the Class B limited partner in the Partnership have made operating loans to the Partnership. In connection with the Amendments, the partners entered into an amendment to the limited partnership agreement of the Partnership to allow for up to $3.0 million of distributions to the partners between September 1, 2025 through September 30, 2027 prior to the Partnership's repayment of the operating loans.
Stratus Properties Inc. published this content on October 06, 2025, and is solely responsible for the information contained herein. Distributed via SEC EDGAR on October 06, 2025 at 21:06 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]