Transcontinental Realty Investors, Inc. Reports First Quarter 2013 Results

Transcontinental Realty Investors, Inc. (NYSE: TCI), a Dallas-based real estate investment company, today reported results of operations for the first quarter ended March 31, 2013. TCI announced today that the Company reported a net loss applicable to common shares of $3.4 million or $0.41 per diluted earnings per share, as compared to a net loss applicable to common shares of $4.5 million or $0.53 per diluted earnings per share for the same period ended 2012.

The Company has shown an unwavering commitment to fortify our portfolio and streamline our operational activity; while at the same time maintaining our commitment to creating value. We are pleased that we are seeing improvements in our operations from these endeavors and will continue to adapt to market challenges with an eye on both near term economic challenges and long-term prospects as the real estate market improves.

Our apartment portfolio continues to thrive in the current economic conditions with occupancies averaging over 95%. We continue to work aggressively to attract new tenants and strive for continuous improvement of our properties in order to maintain our existing tenants.

Included in the net loss applicable to common shares of $3.4 million, for the three months ended March 31, 2013, is $5.0 million in depreciation and amortization expense, $2.4 million of amortization of deferred borrowing costs and $4.0 million of prepayment penalties incurred in the process of refinancing several apartment loans at lower interest rates. For the same period ending March 31, 2012, included in the net loss applicable to common shares of $4.5 million is $5.2 million in depreciation and amortization expense, $0.9 million of amortization of deferred borrowing costs and $2.4 million of prepayment penalties incurred in the process of refinancing several apartment loans at lower interest rates.

Rental and other property revenues as well as property operations have remained in line during the three months ended March 31, 2013 as they were in the prior period.

General and administrative expenses were $1.8 million for the three months ended March 31, 2013. This represents a decrease of $0.7 million, as compared to the same period ending March 31, 2012 expenses of $2.5 million. The majority of the change is due to the reduction in corporate professional services in the current period.

Mortgage and loan interest was $10.0 million for the three months ended March 31, 2013. This represents a decrease of $2.5 million, as compared to the same period ending March 31, 2012 interest expense of $12.5 million. This change, by segment, is a decrease in the apartment portfolio of $0.9 million, a decrease in the commercial portfolio of $1.0 million, a decrease in the land portfolio by $0.2 and a decrease in the other portfolio by $0.4 million. Within the apartment portfolio, the same apartment portfolio decreased $0.9 million due to the refinances closed with long-term, low interest rates. Within the commercial portfolio, the same properties decreased by $1.0 million primarily due to two commercial loans that were in default status and were accruing default interest and late fees during the prior period. After the settlement with the lenders, the loans have been accruing interest at a lower interest rate with no late fees. The decrease in the land and other segments relates to principal payments made during the periods, thereby requiring less future interest to be paid on debt obligations.

About Transcontinental Realty Investors, Inc.

Transcontinental Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of equity real estate located across the U.S., including office buildings, apartments, shopping centers and developed and undeveloped land. The Company invests in real estate through direct ownership, leases and partnerships and invests in mortgage loans on real estate. For more information, visit the Company’s website at www.transconrealty-invest.com.