10-Q: Dream Homes Reports Soaring Revenue, Strategic Shift
Quarterly Report
Dream Homes & Development Corporation announced significantly increased revenue and net income, driven by a strategic focus on Build to Lease and improved lot sales.
Summary
- Revenue for the nine months ended September 30, 2025, increased to $6,970,494, up from $4,313,707 in the prior year period.
- Net income for the nine months ended September 30, 2025, surged to $2,643,323, compared to $59,167 for the same period in 2024.
- Net income attributable to Dream Homes and Development Corporation for the nine months was $367,503, a substantial increase from $59,167 in the prior year.
- Basic and diluted income per common share for the nine months rose to $0.05 from $0.00.
- The company is strategically shifting its focus to Build to Lease properties and developing/improving building lots for sale to national home builders.
- A new funding facility of $13,600,000 was secured for the Autumn Run manufactured home development, retiring an existing $750,000 mortgage.
- The company has a pipeline of 5 developments totaling 357 units either in title or under contract and in development.
- Disclosure controls and procedures were deemed not effective as of September 30, 2025.
Sentiment
Score: 8
Explanation: The company demonstrated strong financial performance with significant increases in revenue, gross profit, and net income. The strategic shift to Build to Lease and improved lot sales is well-aligned with market trends and is yielding positive results. A substantial funding facility was secured, and a new manufacturing initiative is underway. However, a decrease in cash and total equity, along with ineffective disclosure controls and ongoing minor lawsuits, temper the overall positive sentiment.
Positives
- Revenue for the nine months ended September 30, 2025, increased by 61.6% to $6,970,494 from $4,313,707 in the prior year.
- Gross profit for the nine months ended September 30, 2025, significantly increased to $3,618,473 from $1,172,977 in the prior year.
- Net income for the nine months ended September 30, 2025, dramatically improved to $2,643,323 from $59,167 in the prior year.
- Net income attributable to Dream Homes and Development Corporation for the nine months increased to $367,503 from $59,167.
- Basic and diluted income per common share for the nine months rose to $0.05 from $0.00.
- Cash flow from operating activities for the nine months ended September 30, 2025, was $4,405,070, a significant increase from $296,209 in the prior year.
- Successfully secured a $13,600,000 funding facility for the Autumn Run manufactured home development, which includes refinancing existing land debt and funding for infrastructure and vertical construction.
- Multiple building pad sales completed in Berkeley Terrace and Lacey Pines developments, generating significant gross sales (e.g., $1,536,429 for 12 pads in Berkeley Terrace, $893,473 for 7 pads in Lacey Pines).
- Received preliminary approvals for Mathistown Commons (96 units) and signed a Memorandum of Understanding to acquire assets for steel panel and building systems manufacturing, indicating future growth opportunities.
Negatives
- Cash balance decreased to $463,087 as of September 30, 2025, from $1,054,046 as of December 31, 2024.
- Total assets decreased to $9,166,195 as of September 30, 2025, from $11,521,321 as of December 31, 2024.
- Total stockholders' equity decreased to $2,529,086 as of September 30, 2025, from $2,885,885 as of December 31, 2024.
- The company's disclosure controls and procedures were concluded to be not effective as of September 30, 2025.
- The company is involved in several minor lawsuits, including two non-binding arbitration awards against its subsidiary, Shore Custom Homes Corp., which it considers frivolous.
Risks
- Forward-looking statements are subject to inaccurate assumptions and a broad variety of other risks and uncertainties, some known and some unknown.
- Inflationary pressures have had and may continue to have a significant impact on operations, potentially limiting the ability to pass on cost increases to clients.
- The company's estimates of contract revenue and cost are highly detailed and many factors can change during a contract performance period, leading to changes in contract profitability.
- The effectiveness of disclosure controls and procedures is not assured, which could impact the accuracy and timeliness of financial reporting.
Future Outlook
The company anticipates significant future earnings from new construction and forward contracts for improved building pads that have been pre-sold, with this work expected to occur over the next 3-4 years. The remaining buildable lots in Berkeley Terrace are scheduled to close during 2025 and Q1 2026, with the final 8-unit building pad expected to sell in January 2026. For Lacey Pines, 47 improved building pads remain and are scheduled to close in the next 12 months. The Mathistown Commons project is expected to begin sales of improved building pads in late 2026 / early 2027, and Southern Ocean 2 in late 2027. The Autumn Run manufactured home development expects all homes to be sold by mid-2027, with ongoing income from land leases thereafter. The company also intends to close on the acquisition of steel panel and building systems manufacturing assets in early 2026, aiming to expand existing businesses.
Management Comments
- Management is very positive about these new developments.
- It is in the company's opinion that the financial advantages inherent in the sale of a portion of the improved lots in the Berkeley Terrace development outweigh the advantages of building and selling or leasing the entire development.
- It is in the company's opinion that the financial advantages inherent in the sale of a portion of the improved lots in the Lacey Pines development outweigh the advantages of building and selling or leasing the entire development.
- The company has made the decision to change focus to better accommodate growing trends in the real estate market, specifically Build To Lease properties and developing/improving building lots for sale to national home builders.
- The new homes division continues to represent a greater percentage of total revenue, reflecting its greater scalability and growth potential compared to custom homes or elevation/renovation work.
Industry Context
The company's strategic shift towards 'Build to Lease' properties and selling 'Improved Lots for Sale' to national builders aligns with current real estate market trends. This strategy addresses the extreme shortage of rental properties, caters to lender and funding source preferences for safer long-term investments, and capitalizes on the significant interest from non-traditional sources (pension funds, hedge funds, insurance companies, venture capital firms) for completed new 'For Lease' developments and improved lots. This positions Dream Homes to leverage institutional demand and broader demographic shifts favoring rental options and efficient land development for larger builders.
Comparison to Industry Standards
- NA
Corporate Governance
| Change Type | Description | Effective Date | Impact Assessment |
|---|---|---|---|
| Disclosure Controls and Procedures | Management, including the Principal Executive Officer and Principal Financial Officer, concluded that the company's disclosure controls and procedures are not effective to ensure that information required to be disclosed is recorded, processed, summarized, and reported within specified time periods, and communicated to management for timely decisions. | 2025-09-30 | This indicates a material weakness in internal controls over financial reporting, potentially affecting the reliability and transparency of financial disclosures. It requires immediate attention and remediation to ensure compliance and investor confidence. |
Legal Proceedings
- Two non-binding arbitration awards were assessed against the company's subsidiary, Shore Custom Homes Corp., which the company considers frivolous and without merit.
- The company is involved in several other minor lawsuits, which it also expects to prevail in and considers without merit.
- The company intends to vigorously defend its position in all lawsuits and expects no substantive validity or potential for material consequence to the company from these claims.
Related Party Transactions
- Loans payable to related parties totaled $609,999 as of September 30, 2025, bearing interest at 12% payable on demand.
- In January 2025, 1,150,000 restricted shares were issued for services, valued at $25,300.
- In January 2024, 7,000,000 restricted shares were issued for the forgiveness of loans to General Property Investments LLC, a related party, for $105,000.
- The company formerly used services of Shore Custom Homes Corp. (SCHC) personnel, with an estimated share of DHL's gross payroll and payroll taxes of $203,741.49 for the six months ended September 30, 2025. A subsidiary of the company commenced providing payroll services in 2024.
Stakeholder Impact
- Shareholders: Significant increase in net income and EPS could positively impact shareholder value, but the decrease in total equity and ineffective disclosure controls are concerns.
- Customers (National Builders/Homebuyers): The focus on 'Build to Lease' and 'Improved Lots for Sale' indicates a stable supply of developed properties and homes, potentially benefiting customers seeking these options.
- Creditors: The securing of a $13.6 million funding facility and reduction in total liabilities could improve the company's credit profile, though the decrease in cash might be a short-term concern.
- Employees: The new manufacturing initiative could lead to job creation and expansion of the company's operational scope.
Next Steps
- Remaining buildable lots in Berkeley Terrace to close during 2025 and Q1 2026, with the final 8-unit building pad expected to sell in January 2026.
- 47 improved building pads in Lacey Pines are scheduled to close in the next 12 months.
- Louis Avenue property clearing to begin in December 2025, with site work starting in Q4 2025 and base paving in early Q2 2026.
- Autumn Run property clearing to begin in November 2025, with site work starting in Q4 2025 or early 2026, and base paving/first model homes in early Q2 2026.
- Initial closing to acquire Mathistown Commons property expected in 2026, with site improvements shortly thereafter and sale of improved building pads beginning late 2026 / early 2027.
- Initial closing to acquire Southern Ocean 2 property expected in 2027, with site improvements shortly thereafter and sale of improved building pads beginning late 2027.
- Closing on the purchase of steel panel and building systems manufacturing assets expected in early 2026, assuming satisfactory due diligence.
Key Dates
| Date | Description |
|---|---|
| 2009-01-06 | Dream Homes & Development Corporation (formerly The Virtual Learning Company, Inc.) was originally incorporated in Nevada. |
| 2016-09-15 | Established a $500,000 line of credit with General Development Corp. |
| 2017-03-14 | Virtual Learning changed its name to Dream Homes & Development Corporation (DHDC). |
| 2017-04-01 | Commenced office space lease at $2,000 per month. |
| 2018-12-07 | Signed contract to purchase Autumn Run property in Gloucester County, NJ. |
| 2020-05-01 | Office lease monthly rent increased to $2,500. |
| 2020-10-03 | Berkeley Township Planning Board awarded preliminary approvals for 17 townhome units on Louis Avenue, Bayville, NJ. |
| 2021-06-29 | Acquired Lacey Pines property in Lacey Township, New Jersey. |
| 2021-08-04 | Acquired Louis Avenue property in Bayville, NJ. |
| 2021-09-15 | Increased existing line of credit from $500,000 to $1,000,000 with General Development Corp. |
| 2022-08-08 | Received Final approvals for Louis Avenue property. |
| 2023-03-31 | Finalized infrastructure and construction finance facility for Berkeley Terrace development. |
| 2023-09-30 | Office lease monthly rent increased to $3,000. |
| 2023-10-01 | Secured permanent funding for Lacey Pines infrastructure and vertical construction, retiring previous debt. |
| 2023-12-01 | Vertical construction of Building 8 began in Berkeley Terrace development. |
| 2024-01-01 | A subsidiary of the Company commenced providing payroll services. |
| 2024-01-24 | Sold Building Pad 6 (8 improved pads) in Berkeley Terrace, retiring all underlying debt for the property. |
| 2024-01-24 | Sold Building Pad 1 (6 improved pads) in Lacey Pines. |
| 2024-01-01 | Issued 7,000,000 restricted shares for forgiveness of loans to General Property Investments LLC. |
| 2024-03-01 | Site improvements and infrastructure work for Lacey Pines development began. |
| 2024-04-01 | Signed contract in mid-2024 to obtain approvals, acquire and improve Mathistown Commons property. |
| 2024-04-24 | Sold Building Pad 1 (12 improved pads) in Berkeley Terrace. |
| 2024-07-01 | Vertical construction of Building 1 began in Berkeley Terrace development. |
| 2024-07-03 | Sold 12 improved building pads in Berkeley Terrace development for $1,536,429. |
| 2024-07-11 | Sold 7 improved building pads in Lacey Pines development for $893,473. |
| 2025-01-01 | Issued 1,150,000 restricted shares for services, valued at $25,300. |
| 2025-08-14 | Closed on a $13,600,000 funding facility with Asset Based Lending for the Autumn Run manufactured home development. |
| 2025-09-01 | Took title to Autumn Run property. |
| 2025-09-30 | End of the quarterly reporting period. |
| 2025-10-03 | Sold 10 improved building pads in Berkeley Terrace development to a national builder. |
| 2025-10-03 | Sold 8 improved building pads (4 market rate, 4 affordable) in Lacey Pines development to a national builder. |
| 2025-10-01 | Signed a Memorandum of Understanding with a private company to acquire assets for steel panel and building systems manufacturing. |
| 2025-11-07 | Received Little Egg Harbor Preliminary Approvals for Mathistown Commons (80 market rate townhomes and 16 affordable condominiums). |
| 2025-11-13 | Date of filing of the 10-Q report and certification by CEO/CFO. |
| 2025-12-01 | Anticipated start of clearing for Louis Avenue property. |
| 2025-12-01 | Anticipated start of clearing for Autumn Run property. |
| 2026-01-01 | Expected sale of the final 8-unit building pad in Berkeley Terrace development. |
| 2026-01-01 | Anticipated initial closing to acquire Mathistown Commons property. |
| 2026-01-01 | Anticipated closing on the purchase of steel panel and building systems manufacturing assets. |
| 2026-04-01 | Scheduled installation of base paving for Louis Avenue property. |
| 2026-04-01 | Scheduled installation of base paving and completion of first model homes for Autumn Run property. |
| 2026-10-01 | Expected start of sale of improved building pads for Mathistown Commons. |
| 2027-01-01 | Anticipated initial closing to acquire Southern Ocean 2 property. |
| 2027-07-01 | Expected completion of all home sales for Autumn Run development. |
| 2027-10-01 | Expected start of sale of improved building pads for Southern Ocean 2. |
Recommendation
buyThe company demonstrates strong operational momentum with a significant increase in revenue and net income, driven by a strategic shift into high-demand segments like Build to Lease and improved lot sales to national builders. The robust project pipeline and successful securing of substantial development funding indicate strong future growth potential. While the decrease in cash and total equity, along with the ineffective disclosure controls, are areas for concern, the fundamental business performance and strategic direction suggest a positive outlook. The new manufacturing initiative further diversifies revenue streams. For a seasoned investor, the strong growth metrics and clear strategic path outweigh the identified risks, positioning the company for potential capital appreciation.
Keywords
Real Estate Development, Homebuilding, Build to Lease, Improved Lots, Residential Communities, SEC Filing, Quarterly Report, Construction Contracts, New Jersey Real Estate, Manufactured Housing
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