Tejon Ranch Co (NYSE: TRC)

Tejon Ranch Co. is a diversified real estate development company focused on the planning, entitlement, development, leasing, and monetization of land-based assets. Its primary operations are anchored by the Tejon Ranch Commerce Center, a 20 million-square-foot commercial and industrial development strategically located along Interstate 5 at the gateway between the Los Angeles Basin and California’s Central Valley. The company also engages in mineral resources, farming, and ranching activities across approximately 270,000 acres of contiguous landholdings.

The company generates revenue through multiple streams, including leasing of commercial and industrial properties at the Tejon Ranch Commerce Center, rental income from multifamily residential communities, royalty income from mineral extraction such as oil, gas, cement, and rock and aggregate, proceeds from farming operations including almonds, pistachios, and wine grapes, and grazing lease and game management revenues from ranch activities. These operations are supported by long-term water rights and infrastructure investments that enable consistent agricultural and land use productivity.

The company operates through the following segments: Real Estate - Commercial/Industrial, Multifamily, Real Estate - Resort/Residential, Mineral Resources, Farming, and Ranch Operations.

• Real Estate - Commercial/Industrial: This segment encompasses the full cycle of real estate value creation at the Tejon Ranch Commerce Center, including planning, permitting, infrastructure development, construction of buildings (both pre-leased and speculative), and sale of entitled land parcels to third parties. As of December 31, 2025, the industrial portfolio consisted of 2.8 million square feet of gross leasable area and the commercial portfolio consisted of 620,907 square feet of gross leasable area, both fully leased to nationally recognized tenants. Major tenants include IKEA, Caterpillar, Nestlé, Famous Footwear, L'Oreal, Camping World, Sunrise Brands, Dollar General, and RectorSeal, with operations supported by net lease agreements requiring tenants to cover property taxes, insurance, and maintenance.

• Multifamily: This segment focuses on the development and long-term ownership of residential rental communities within master-planned projects, beginning with Terra Vista at Tejon. Terra Vista at Tejon is a 22-acre site adjacent to the Outlets at Tejon, consisting of thirteen apartment buildings with up to 495 multifamily residences, 6,500 square feet of community amenity space, and 8,000 square feet of community-serving retail. The first phase, completed in 2025, includes 228 units and was approximately 63% leased as of December 31, 2025, with average lease terms of 12 months, providing housing for employees working at distribution centers, retail establishments, hotels, and restaurants within TRCC.

• Real Estate - Resort/Residential: This segment includes land entitlement, planning, pre-construction engineering, and stewardship for large-scale master-planned communities such as Mountain Village, Grapevine, and Centennial. Mountain Village is entitled for 3,450 homes, 160,000 square feet of commercial development, and 750 hotel keys across 26,417 acres. Grapevine is entitled for 12,000 homes, 5.1 million square feet of commercial development, and more than 3,367 acres of open space. Centennial is planned for 19,333 housing units, including nearly 3,500 affordable units, and 10.1 million square feet of commercial development across 12,323 acres in Los Angeles County.

• Mineral Resources: This segment generates recurring royalty income from third-party extraction activities involving oil and gas, rock and aggregate, and a cement operation leased to National Cement Company of California, Inc. As of December 31, 2025, 12,015 acres were committed to oil and gas leases, from which operators produced approximately 67,441 barrels of oil and 13,088 MCF of dry gas during 2025, with royalty rates averaging 15% of oil production. The company also leases 2,000 acres to National Cement for limestone extraction and 277 acres to Granite Construction and 244 acres to Griffith Construction for rock and aggregate mining used in road and bridge construction.

• Farming: This segment involves the cultivation of permanent crops including wine grapes (1,036 acres), almonds (1,962 acres, with 1,350 in production and 612 under development), and pistachios (932 acres), all located on the San Joaquin Valley floor. The company also has 150 acres of olives under development, with plans to plant an additional 150 acres in 2026. Farming operations are supported by long-term water rights tied to the State Water Project and local systems, ensuring reliable water access independent of annual rainfall, and utilize automated drip irrigation systems for efficient crop management.

• Ranch Operations: This segment consists of grazing lease revenues, game management revenues, land maintenance, and ancillary uses such as filming across approximately 270,000 acres of landholdings. Approximately 256,000 acres are used for two grazing leases, which accounted for 41% of total ranch operations revenue as of December 31, 2025. The segment also offers guided big game hunts for trophy Rocky Mountain elk, deer, turkey, and wild pig, and manages land maintenance, security, and infrastructure upkeep across the entire ranch, including oversight of the High Desert Hunt Club operating from the historic Beale Adobe.

Within the real estate development sector, Tejon Ranch Co. holds a competitive advantage due to its strategic location along Interstate 5, providing direct access to major transportation corridors serving over 40 million people for next-day delivery. The Tejon Ranch Commerce Center benefits from Kern County’s pro-business AdvanceKern incentive program, which offers support in securing state tax incentives, infrastructure development, and workforce training. The company faces competition from industrial developers in the Inland Empire, particularly in Riverside, San Bernardino, Perris, Moreno Valley, and Beaumont, as well as from logistics-focused users in the Santa Clarita and San Fernando Valleys, though its entitled, shovel-ready land and proximity to ports via Interstate 5 enhance its appeal as an inland alternative.

The company serves a diverse customer base including national and regional industrial tenants such as IKEA, Caterpillar, Nestlé, L'Oreal, and Dollar General at the Tejon Ranch Commerce Center. Residential rental units at Terra Vista at Tejon are leased to individuals seeking housing near employment centers in logistics and distribution. Mineral resources royalties are received from third-party operators including National Cement Company, Granite Construction, and Griffith Construction. Farming products such as almonds, pistachios, and wine grapes are sold to commercial buyers, wineries, and agricultural processors. Ranch operations revenue is derived from grazing lessees and participants in guided hunting programs offered through the High Desert Hunt Club.