Comstock Holding Companies, Inc 10-K for FY2021

Comstock Holding Companies, Inc. (CHCI)

10-K 2022-03-31 For: 2021-12-31

Added on April 09, 2026

About this 10-K

Comstock Holding Companies, Inc filed this 10-K on March 31, 2022, covering the fiscal year ended December 31, 2021 (FY2021).

Headline figures

Fiscal year ended December 31, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $31.09M; up 38.3% from $22.49M a year earlier
Net income: $13.61M; up 553.7% from net income of $2.08M a year earlier
Diluted EPS: $1.50; up 525.0% from $0.24 a year earlier

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Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐


PART I		1
Item 1.	Business	2
Item 1B.	Unresolved Staff Comments	9
Item 2.	Properties	9
Item 3.	Legal Proceedings	9
Item 4.	Mine Safety Disclosures	9

PART II		10
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	10
Item 6.	Reserved	10
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	16
Item 8.	Financial Statements and Supplementary Data	17
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	18
Item 9A.	Controls and Procedures	18
Item 9B.	Other Information	18

PART III		19

PART IV
Item 15.	Exhibits and Financial Statement Schedules	20
Item 16.	10-K Summary

SIGNATURES		24


	Year Ended December 31,
	2021		2020
Revenue	$	31,093	$	22,487
Operating costs and expenses:
Cost of revenue	24,649		18,445
Selling, general, and administrative	1,285		1,314
Depreciation and amortization	94		74
Total operating costs and expenses	26,028		19,833
Income (loss) from operations	5,065		2,654
Other income (expense)
Interest expense	(235)		(344)
Gain (loss) on equity method investments	(14)		(160)
Other income	6		16
Income (loss) from continuing operations before income tax	4,822		2,166
Provision for (benefit from) income tax	(11,217)		25
Net income (loss) from continuing operations	16,039		2,141
Net income (loss) from discontinued operations, net of tax	(2,430)		(59)
Net income (loss)	$	13,609	$	2,082


	Year Ended December 31,
	2021				2020				Change
	Net Sales		%		Net Sales		%		$		%
Asset management	$	22,539	72.5	%	$	16,057	71.4	%	$	6,482	40.4	%
Property management	6,939		22.3	%	5,410		24.1	%	1,529		28.3	%
Parking	1,615		5.2	%	1,020		4.5	%	595		58.3	%
Total revenue	$	31,093	100.0	%	$	22,487	100.0	%	$	8,606	38.3	%


	Year Ended December 31,				Change
	2021		2020		$		%
Cost of revenue	$	24,649	$	18,445	$	6,204	33.6	%
Selling, general, and administrative	1,285		1,314		(29)		(2.2)	%
Depreciation and amortization	94		74		20		27.0	%
Total operating costs and expenses	$	26,028	$	19,833	$	6,195	31.2	%


☒			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


			Page
Report of Independent Registered Public Accounting Firm (PCAOB ID #248)			F-1
Consolidated Balance Sheets at December 31, 202 1 and 20 20			F-3
Consolidated Statements of Operations for the Years Ended December 31, 202 1 and 20 20			F-4
Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 202 1 and 20 20			F-5
Consolidated Statements of Cash Flows for the Years Ended December 31, 202 1 and 20 20			F-6
Notes to Consolidated Financial Statements			F-7


	December 31,

	2021		2020

Assets
Current assets:
Cash and cash equivalents	$	15,823	$	7,032
Accounts receivable	46		62
Accounts receivable - related parties	1,697		3,568
Prepaid expenses and other current assets	197		186
Current assets held for sale	2,313		1,477
Total current assets	20,076		12,325
Fixed assets, net	264		170
Investments in real estate ventures	4,702		6,307
Operating lease assets	7,245		7,914
Deferred income taxes, net	11,300		—
Other assets	15		29
Non-current assets held for sale	—		1,834
Total assets	$	43,602	$	28,579

Liabilities and Stockholders' Equity
Current liabilities:
Accrued personnel costs	$	3,468	$	2,333
Accounts payable and accrued liabilities	783		854
Current operating lease liabilities	616		569
Current loans payable	—		5
Current liabilities held for sale	1,194		742
Total current liabilities	6,061		4,503
Credit facility - due to affiliates	5,500		5,500
Operating lease liabilities	6,745		7,361
Total liabilities	18,306		17,364
Commitments and contingencies (Note 8)
Stockholders' equity:
Series C preferred stock; $0.01 par value; aggregate liquidation preference of $17,203; 20,000 shares authorized; 3,441 issued and outstanding as of December 31, 2021 and 2020	6,765		6,765
Class A common stock; $0.01 par value; 59,780 shares authorized; 8,102 and 7,953 issued, and 8,017 and 7,868 outstanding as of December 31, 2021 and 2020, respectively	81		79
Class B common stock; $0.01 par value; 220 shares authorized, issued, and outstanding as of December 31, 2021 and 2020	2		2
Additional paid-in capital	200,617		200,147
Treasury stock, at cost (86 shares of Class A common stock)	(2,662)		(2,662)
Accumulated deficit	(179,507)		(193,116)
Total stockholders' equity	25,296		11,215
Total liabilities and stockholders' equity	$	43,602	$	28,579


	Series C			Class A			Class B
	Preferred Stock			Common Stock			Common Stock					Treasury		Accumulated
	Shares	Amount		Shares	Amount		Shares	Amount		APIC		stock		deficit		Total
Balance as of December 31, 2019	3,441	$	6,765	7,849	$	78	220	$	2	$	199,372	$	(2,662)	$	(195,198)	$	8,357
Issuance of common stock, net of shares withheld for taxes	—	—		104	1		—	—		(1)		—		—		—
Stock-based compensation	—	—		—	—		—	—		776		—		—		776
Net income (loss)	—	—		—	—		—	—		—		—		2,082		2,082
Balance as of December 31, 2020	3,441	6,765		7,953	79		220	2		200,147		(2,662)		(193,116)		11,215
Issuance of common stock, net of shares withheld for taxes	—	—		149	2		—	—		(252)		—		—		(250)
Stock-based compensation	—	—		—	—		—	—		722		—		—		722
Net income (loss)	—	—		—	—		—	—		—		—		13,609		13,609
Balance as of December 31, 2021	3,441	$	6,765	8,102	$	81	220	$	2	$	200,617	$	(2,662)	$	(179,507)	$	25,296


Asset Class						Estimated Useful Life
Leasehold improvements						Shorter of asset life or related lease term
Furniture and fixtures						7 years
Office equipment						5 years
Vehicles						5 years
Computer equipment						3 years
Capitalized software						3 years


	December 31,
Description	2021		2020
Investors X	$	1,484	$	5,147
The Hartford	1,211		1,160
BLVD 44	2,007		—
Total	$	4,702	$	6,307


Balance as of December 31, 2019	$	8,421
Investments	—
Distributions	(1,921)
Change in fair value	(193)
Balance as of December 31, 2020	6,307
Investments	2,058
Distributions	(3,522)
Change in fair value	(141)
Balance as of December 31, 2021	$	4,702


	Year Ended December 31,
Combined Statements of Operations:		2021		2020
Revenue		$	17,670	$	24,009
Operating income (loss)		8,878		8,097
Net income (loss)		(316)		(737)


Year Ending December 31,	Operating Leases
2022	$	917
2023	939
2024	961
2025	984
2026	1,008
Thereafter	4,091
Total future lease payments	8,900
Imputed interest	(1,539)
Total lease liabilities	$	7,361


COMSTOCK HOLDING COMPANIES, INC.


	Year Ended December 31,
	2021		2020
Continuing operations
Net cash provided by (used in) operating activities	$	8,688	$	3,579
Net cash provided by (used in) investing activities	1,276		1,703
Net cash provided by (used in) financing activities	(227)		(282)
Total net increase (decrease) in cash - continuing operations	9,737		5,000
Discontinued operations, net	(946)		(1,479)
Net increase (decrease) in cash and cash equivalents	$	8,791	$	3,521


	RSUs Outstanding	Weighted-Average Grant Date Fair Value
Balance as of December 31, 2020	870	$	2.06
Granted	176	3.25


Released	(184)	2.14
Canceled/Forfeited	(15)	2.29
Balance as of December 31, 2021	847	$	2.28


	Options Outstanding	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Balance as of December 31, 2020	436	$	2.81	6.74	$	424
Granted	—	—
Exercised	(24)	2.14
Canceled/Forfeited	(15)	1.84
Expired	—	—
Balance as of December 31, 2021	397	$	2.89	5.7	$	998
Exercisable as of December 31, 2021	335	$	3.01	4.4	$	836


1			2020 amount is included in accounts payable and accrued liabilities on the consolidated balance sheet


Exhibit Number		Description

	3.1	Amended and Restated Certificate of Incorporation; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on November 16, 2015.

	3.2	Certificate of Amendment of Amended and Restated Certificate of Incorporation of Comstock Holding Companies, Inc.; incorporated by reference to an exhibit to the Registrant’s Current Report on Form 8-K filed with the Commission on February 19, 2019.

	3.3	Amended and Restated Bylaws; incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on March 31, 2005.

	3.4	Certificate of Designation of Series C Non-Convertible Preferred Stock of Comstock Holding Companies, Inc., filed with the Secretary of the State of Delaware on March 22, 2017; incorporated by reference to an exhibit to the Registrant’s Current Report on Form 8-K filed with the Commission on March 28, 2017.

	3.5	Certificate of Amendment of Certificate of Designation of Series C Non-Convertible Preferred Stock of Comstock Holding Companies, Inc. filed with the Secretary of State of the State of Delaware on February 15, 2019; incorporated by reference to an exhibit to the Registrant’s Current Report on Form 8-K filed with the Commission on February 19, 2019.

	4.1	Specimen Stock Certificate; incorporated by reference to an exhibit to the Registrant’s Registration Statement on Form S-1, as amended, initially filed with the Commission on August 13, 2004 (No. 333-118193).

	4.2*	Description of Capital Stock

	10.1	Form of Indemnification Agreement; incorporated by reference to an exhibit to the Registrant’s Registration Statement on Form S-1, as amended, initially filed with the Commission on August 13, 2004 (No. 333-118193).

	10.2+	2004 Long-Term Incentive Compensation Plan; incorporated by reference to an exhibit to the Registrant’s Registration Statement on Form S-1, as amended, initially filed with the Commission on August 13, 2004 (No. 333-118193).

	10.3+	Employee Stock Purchase Plan; incorporated by reference to an exhibit to the Registrant’s Registration Statement on Form S-1, as amended, initially filed with the Commission on August 13, 2004 (No. 333-118193).

	10.4	Services Agreement, dated March 4, 2005, with Comstock Asset Management, L.C.; incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on March 31, 2005.


			10.5+						Employment Agreement with Christopher Clemente; incorporated by reference to an exhibit to the Registrant’s Registration Statement on Form S-1, as amended, initially filed with the Commission on August 13, 2004 (No. 333-118193).

			10.6+						Confidentiality and Non-Competition Agreement with Christopher Clemente; incorporated by reference to an exhibit to the Registrant’s Registration Statement on Form S-1, as amended, initially filed with the Commission on August 13, 2004 (No. 333-118193).

			10.7						Trademark License Agreement; incorporated by reference to an exhibit to the Registrant’s Registration Statement on Form S-1, as amended, initially filed with the Commission on August 13, 2004 (No. 333-118193).

			10.8						Lease Agreement, dated on or about December 31, 2009, with Comstock Asset Management, L.C. by Comstock Property Management, L.C., a subsidiary of Registrant; incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on March 31, 2010.

			10.9						Credit Enhancement and Indemnification Agreement, dated February 17, 2011, by and between Registrant and Christopher D. Clemente and Gregory V. Benson; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on May 13, 2011.

			10.10						Form of warrant issued in connection with private placement by Comstock Growth Fund, L.C.; incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on April 14, 2015.

			10.11						Section 382 Rights Agreement between Comstock Holding Companies, Inc. and American Stock Transfer & Trust Company, LLC dated March 27, 2015; incorporated by reference to an Exhibit to the current report on Form 8-K filed with the Commission on March 27, 2015.

			10.12						Form of Subscription Agreement and Operating Agreement dated August 15, 2016, between Comstock Investors X, L.C. and [-], with accompanying Schedule A identifying subscribers; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on November 14, 2016.

			10.13						Form of Warrant issued in connection with private placement by Comstock Investors X, L.C.; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on November 14, 2016.

			10.14						Share Exchange Agreement between Comstock Holding Companies, Inc. and Investor Management, L.C., Christopher Clemente and Teresa A. Schar dated March 22, 2017; incorporated by reference to an exhibit to the Registrant’s Current Report on Form 8-K filed with the Commission on March 28, 2017.

			10.15						Asset Purchase Agreement, dated July 14, 2017, between CHCI Capital Management, L.C. (formerly CDS Capital Management, L.C.) and Monridge Environmental, LLC; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on November 16, 2017.

			10.16						Amendment to the Operating Agreement, dated October 13, 2017, between Comstock Investors X, L.C. and CP Real Estate Services, LC (formerly Comstock Development Services, LC); incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on November 16, 2017.

			10.17						Form of Warrant, dated October 13, 2017, between Comstock Investors X, L.C. and CP Real Estate Services, LC (formerly Comstock Development Services, LC); incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed on November 16, 2017.

			10.18+						Comstock Holding Companies, Inc. 2019 Omnibus Incentive Plan; incorporated by reference to Annex B to the Registrant’s Definitive Proxy Statement on Schedule 14A filed on January 22, 2019.

			10.19						2019 Master Asset Management Agreement, dated January 2, 2019, between CHCI Asset Management, L.C. (formerly CDS Asset Management, L.C) and CP Real Estate Services, LC (formerly Comstock Development Services, LC ); incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on April 15, 2020.


			10.20						Form of Time-Based Restricted Stock Unit Agreement under the 2019 Omnibus Incentive Plan; incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on April 15, 2020.

			10.21						Form of Performance Based Restricted Stock Unit Agreement under the 2019 Omnibus Incentive Plan; incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on April 15, 2020.

			10.22*						Business Management Agreement dated July 1, 2019 by and between CHCI Asset Management, L.C. (formerly CDS Asset Management, L.C) and CP Real Estate Services, LC (formerly Comstock Development Services, LC )

			10.23						Amended and Restated Limited Liability Company Agreement of Comstock 3101 Wilson, LC dated February 7, 2020; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on August 14, 2020.

			10.24						Ten Million ($10,000,000) Revolving Capital Line of Credit Agreement dated March 19, 2020, Comstock Holding Companies, Inc. and CP Real Estate Services, LC (formerly Comstock Development Services, LC); incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on May 28, 2020.

			10.25						Promissory Note dated March 27, 2020, between Comstock Holding Companies, Inc. and CP Real Estate Services, LC (formerly Comstock Development Services, LC ); incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on May 28, 2020.

			10.26						Note dated April 16, 2020 between Comstock Holding Companies, Inc. and MainStreet Bank pursuant to the Paycheck Protection Program authorized under the Coronavirus Aid, Relief and Economic Security Act; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on May 28, 2020.

			10.27+						Amended and Restated Employment Agreement dated April 27, 2020, between Comstock Holding Companies, Inc. and Christopher Clemente; incorporated by reference to an exhibit to the Registrant’s Quarterly Report on Form 10-Q filed with the Commission on August 14, 2020.

			10.28						Letter of BDO USA, LLP dated June 24, 2020; incorporated by reference to an exhibit to the Registrant’s Current Report on Form 8-K filed with the Commission on June 24, 2020.

			10.29						Deed of Lease dated November 1, 2020, between CRS Plaza I, LC and Comstock Holding Companies, Inc.; incorporated by reference to an exhibit to the Registrant's Annual Report of Form 10-K filed with the Commission on March 31, 2021.

			10.30*						Operating Agreement of Comstock 44 Maryland, L C dated October 20, 2021.

			10.31+*						Consultant Agreement dated November 3, 2021 by and between Comstock Holding Companies, Inc. and Ivy Zelman.

			14.1						Code of Ethics (incorporated by reference to an exhibit to the Registrant’s Annual Report on Form 10-K filed with the Commission on March 31, 2005).

			21.1*						List of subsidiaries

			23.1*						Consent of Grant Thornton, LLP

			31.1*						Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002

			31.2*						Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002

			32.1*						Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002



101*		101.INS Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document 101.SCH Inline XBRL Taxonomy Extension Schema 101.CAL Inline XBRL Taxonomy Extension Calculation 101.PRE Inline XBRL Taxonomy Extension Presentation 101.LAB Inline XBRL Taxonomy Extension Labels 101.DEF Inline XBRL Taxonomy Extension Definition

104*		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


*	Filed herewith
+	Management contracts or compensatory plans, contracts or arrangements


	COMSTOCK HOLDING COMPANIES, INC.

Date: March 31, 2022	By:	/s/ CHRISTOPHER CLEMENTE
		Christopher Clemente Chairman and Chief Executive Officer


Name		State of Incorporation or Organization
1	Comstock Homes of Washington, L.C.	Virginia
2	Comstock Investors X, L.C.	Virginia
3	Comstock Growth Fund, L.C.	Virginia
4	Superior Title Services, L.C.	Virginia
5	CHCI Capital Management, LC f/k/a CDS Capital Management, LC	Virginia
6	CHCI Real Estate Services, L.C. f/k/a Comstock Real Estate Services, LC	Virginia
7	Comstock Environmental Services, LLC f/k/a JK Environmental Services, LLC Virginia	Virginia
8	CHCI Asset Management, LC f/k/a CDS Asset Management, LC	Virginia
9	CHCI Residential Management, LC f/k/a Comstock Residential Management, LC	Virginia
10	CHCI Commercial Management, LC f/k/a Comstock Commercial Management, LC	Virginia
11	ParkX Management, LC d/b/a ParkX	Virginia


Date: March 31, 2022			/s/ CHRISTOPHER GUTHRIE
			Christopher Guthrie Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)