TEJON RANCH CO (TRC) Business

ITEM 1.     BUSINESS

Company Overview

We are a diversified real estate development company anchored by the Tejon Ranch Commerce Center (“TRCC”), 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. TRCC is the primary driver of our revenue and earnings. TRC’s portfolio within TRCC comprises approximately 3.4 million square feet of gross leasable area, which is substantially fully leased to nationally recognized tenants, including IKEA, L’Oréal, and Dollar General. In addition, the broader TRCC development, totaling over 8 million square feet, includes major third-party industrial users such as Caterpillar and Nestlé, further reinforcing the scale, quality, and strategic importance of the park.

We are actively expanding TRCC through additional industrial development, commercial leasing activity, and the introduction of our first residential community, Terra Vista at Tejon, which has transitioned TRCC into a mixed-use master-planned development. In connection with the commencement of lease-up at Terra Vista at Tejon, we began reporting Multifamily as a separate operating segment in 2025, reflecting our expansion into the development and long-term ownership of residential rental communities.

These commercial and multifamily operations are complemented by mineral resources, farming, and ranching activities conducted across approximately 270,000 acres of contiguous landholdings. In addition, we hold long-term real estate entitlements for two large-scale master-planned residential communities and are pursuing entitlements for a third, representing in the aggregate more than 35,000 housing units and approximately 35 million square feet of future commercial development.

Capital allocation decisions, including the timing of residential development, joint venture formation, infrastructure investment and potential asset monetization, are subject to periodic review by management and the Board of Directors based on market conditions, capital availability, entitlement status, litigation developments and projected risk-adjusted returns.

We conduct these activities through our six reporting segments:

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Our prime asset is approximately 270,000 acres of contiguous, largely undeveloped land, extending approximately 60 miles north of downtown Los Angeles at its southern boundary and to an area approximately 15 miles southeast of Bakersfield at its northern boundary. We create value by securing entitlements for our land, facilitating infrastructure development, strategic land planning, monetization of land through development and/or sales or leases, and conservation in order to maximize the highest and best use for our land. We are involved in nine joint ventures that either own, develop, and/or operate real estate properties. We enter into joint ventures as a means to facilitate the development of portions of our land.

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Tejon Ranch Commerce Center

Business Objectives and Strategies

Our primary business objective is to maximize long-term shareholder value through the development, leasing, and monetization of our land-based assets, with our commercial and industrial operations at the Tejon Ranch Commerce Center (“TRCC”) serving as a central component of this strategy. In addition, our real estate platform now includes a dedicated Multifamily segment, reflecting our strategic evolution into a more diversified, mixed-use master-planned development. We allocate capital toward projects that we believe generate attractive risk-adjusted returns while enhancing the long-term value of our landholdings.

For the year ended December 31, 2025, our Commercial/Industrial Real Estate segment generated $15.4 million of operating income, inclusive of equity in earnings from unconsolidated joint ventures. As of December 31, 2025, our industrial portfolio was 100% leased and our commercial portfolio was 98% leased. We currently have approximately 11.1 million square feet of additional entitled industrial space available for future development.

Complementing our commercial platform, our Multifamily segment is focused on the development and long-term ownership of residential rental communities within our master-planned projects, beginning with Terra Vista at Tejon. Terra Vista is currently in the lease-up phase as we work to stabilize occupancy and optimize rental rates. Typical of newly delivered apartment communities, lease-up is expected to occur over time as market awareness builds and occupancy trends toward stabilized levels. Upon stabilization, we expect the project to generate recurring rental revenues and net operating income, increasing the stability and predictability of our earnings. Multifamily development also supports on-site employment centers by providing housing within our mixed-use communities and represents a strategic expansion of our real estate platform.

Looking beyond our current development footprint at TRCC, we hold long-term entitlements for two large-scale master-planned residential communities - Mountain Village and Grapevine - and are in the re-entitlement process for a third,

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Centennial (as described below), collectively comprising 35,278 housing units and more than 35 million square feet of commercial development.

Mountain Village has received its first approved final map consisting of 401 residential lots and parcels for hospitality, amenities, and public uses. Grapevine has approved entitlements for 12,000 residential units and approximately 5 million square feet of commercial development. Centennial received entitlement approvals in 2018 and legislative approvals in 2019.

The Centennial approvals granted by the Los Angeles County Board of Supervisors in 2019 were challenged in two lawsuits filed in Los Angeles County Superior Court in May 2019. In January 2022, the Superior Court issued a decision rescinding certain project approvals, followed by a final judgment on March 22, 2023. On May 26, 2023, the Company filed a notice of appeal, and on June 27, 2023, plaintiffs filed a cross-appeal. The Court of Appeal held a hearing on April 3, 2025 and, on June 26, 2025, the Court of Appeal issued a written decision affirming the Superior Court’s judgment. On September 22, 2025, the Superior Court issued a writ of mandate ordering Los Angeles County to set aside the Centennial approvals. On December 2, 2025, LA County rescinded and set aside the Centennial approvals. The Company is in the process of working with Los Angeles County to advance the Centennial project and has begun the process to re-entitlement of the Centennial project (“re-entitlement”). We expect that re-entitlement will involve processing project and land use entitlements that are substantively similar to the Centennial land use approvals that were approved in April of 2019, while addressing the matters adjudicated in the litigation. See Commitments and Contingencies Footnote 13.

We also generate revenue from mineral resources, farming, and ranch operations conducted across our approximately 270,000 acres of contiguous landholdings.

Our mineral resources operations generate recurring royalty income from third-party extraction activities with minimal capital deployment by the Company. These activities leverage the underlying value of our land and represent a natural extension of our land-based business model.

Our farming operations provide revenue diversification and represent a productive interim use of certain land areas while long-term development plans mature. Our almond and pistachio acreage located on the San Joaquin Valley floor generates current cash flow and maintains these properties in active agricultural production pending potential future development, including areas contemplated for projects such as Grapevine North. These operations are supported by the Company’s long-term water rights and related infrastructure investments, including fixed water obligations associated with the State Water Project and local water systems, which secure reliable access to water resources independent of annual farming activity.

Our ranch operations primarily support land stewardship and cost management across our broader landholdings. These activities include infrastructure maintenance and operational oversight of our approximately 270,000 acres and contribute modest operating income.

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Percentage of Total Revenue1 by Segment:

1 Charts present segment revenues and equity in earnings of unconsolidated joint ventures, which has been included in real estate, while other income components are excluded.

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Note: Our Resort Residential reporting segment is not a revenue generating segment in the periods reported herein.

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The following table shows the revenues from continuing operations, segment operating results and identifiable assets of each of our continuing segments for the last three years:

FINANCIAL INFORMATION ABOUT SEGMENTS

(Amounts in thousands of dollars)

1 Segment operating income is comprised of revenues and equity in earnings of unconsolidated joint ventures, less segment expenses, excluding investment income, other income (loss), corporate expenses, and income taxes.

2 Identifiable Assets by Segment include both assets directly identified with those operations and an allocable share of jointly used assets. Corporate assets consist of cash and cash equivalents, refundable and deferred income taxes, land, buildings, and improvements. Commercial/Industrial and Multifamily also includes buildings and improvements.

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Real Estate Development Overview

Our real estate operations are led by our commercial and industrial development activities at TRCC, which represent the most advanced and productive stage of our real estate development continuum. In addition, our expanding Multifamily platform reflects the next phase of vertical development within our master-planned strategy, with a focus on the development, lease-up, and long-term ownership of residential rental communities. Beyond TRCC, our real estate operations include land planning and entitlement for future large-scale communities, land development, and conservation.

Interstate 5, one of the nation’s most heavily traveled freeways, brings in excess of 89,000 vehicles per day through our land, according to data from the California Department of Transportation. Our holdings include 16 miles of Interstate 5 frontage on each side of the freeway and the commercial land surrounding three interchanges. The strategic plan for real estate focuses on development opportunities along the Interstate 5 and Highway 138 corridors, which includes TRCC; MV, a resort and residential community; Grapevine, a mixed-use master planned community in Kern County; Grapevine North, a 7,655-acre development area; and Centennial, a mixed-use master planned community in Los Angeles County. TRCC includes developments east and west of Interstate 5 at TRCC-East and TRCC-West, respectively.

The chart below is a continuum of the real estate development process highlighting each project's current status and key milestones to be met in moving through the real estate development process in California. During this process, we may experience delays arising from factors beyond our control. Such factors include litigation and a changing regulatory environment and adverse market conditions.

Note: Grapevine North's entitlement efforts have not yet begun. The Company regularly assesses its long-term growth strategy and capital resources when determining when to start this development.

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Reporting Segments

Real Estate - Commercial/Industrial

The Commercial/Industrial segment is the Company’s primary revenue and earnings engine, encompassing the full cycle of real estate value creation: planning and permitting of land held for development, construction of infrastructure and buildings (both pre-leased and speculative), and the sale of entitled land parcels to third parties. As of December 31, 2025, the commercial/industrial real estate segment generated $15.0 million in consolidated revenue and $15.4 million in segment operating income, which includes $8.4 million of equity in earnings from unconsolidated joint ventures. This segment represents the largest contributor to the Company’s consolidated operating income. In addition to rental revenues, the segment benefits from recurring income streams such as communications leases, a power plant lease, and landscape maintenance fees.

At the heart of our real estate Commercial/Industrial segment is TRCC, a 20 million square foot commercial/industrial development on Interstate 5 just north of the Los Angeles Basin. The Los Angeles industrial market is the largest in the country by many measures, sitting at the center of a 2 billion square-foot Southern California industrial market. It has been characterized by some of the highest asking rents and lowest vacancy rates of any market in the nation. The Ports of Los Angeles and Long Beach are the primary industrial drivers and are responsible for over 30% of all inbound containers into the U.S.

As of December 31, 2025, our industrial portfolio, through our joint venture partnerships, consisted of 2.8 million square feet of gross leasable area, or GLA, and our TRCC commercial portfolio consisted of 620,907 square feet of GLA. As of December 31, 2025, our industrial portfolio was 100% leased and our commercial portfolio was 98% leased. Substantially all of our tenants are subject to net lease agreements. A net lease typically requires the tenant to be responsible for minimum monthly rent and property expenses including property taxes, insurance, and maintenance.

Over eight million square feet of industrial, commercial, and retail space has been developed at TRCC, including properties owned and operated by us as well as facilities constructed by third parties on land previously sold by the Company. These

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developments are operational, or expected to commence construction in the near term, and include distribution centers for IKEA, Caterpillar, Nestlé, Famous Footwear, L'Oreal, Camping World, Sunrise Brands, Dollar General and RectorSeal. TRCC spans both sides of Interstate 5, providing distributors immediate access to the West Coast’s primary north-south goods movement corridor.

TRCC has an FTZ designation, of approximately 1,094 acres, which allows a user within the FTZ to secure the many benefits and cost reductions associated with streamlined movement of goods in and out of a trade zone. TRCC's attractiveness as a commercial/industrial location is further enhanced by AdvanceKern, formerly known as the Economic Development Incentive Policy, or EDIP, adopted by the Kern County Board of Supervisors. AdvanceKern is designed to expand and enhance the County's competitiveness by taking affirmative steps to attract new businesses and to encourage the growth and resilience of existing businesses. AdvanceKern provides incentives such as assistance in obtaining state tax incentives, building supporting infrastructure, and workforce development.

Leasing

Within our Commercial/Industrial segment, we lease land to various types of tenants. We currently lease land to two auto service stations with convenience stores, 12 fast-food operations, a motel, an antique shop, and a post office.

In addition, the Company leases several microwave repeater locations, radio and cellular transmitter sites, fiber optic cable routes, and 32 acres of land to PEF for an electric power plant.

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The following table summarizes information with respect to lease expirations for our consolidated entities as of December 31, 2025.

For the year ended December 31, 2025, we had three lease renewals.

Joint Ventures

We use joint ventures to advance our development projects at TRCC. This allows us to combine our resources with other real estate companies and gain greater access to capital, share in the risks of real estate developments and share in the operating expenses. More importantly, we believe it allows us to better manage the deployment of our capital.

Our joint venture with TravelCenters of America owns and operates two travel and truck stop facilities, two restaurants, 13 fast-food operations, and five separate gas stations with convenience stores within TRCC-West and TRCC-East.

We are involved in five joint ventures with Majestic Realty Co., or Majestic, to develop, lease, manage, and/or acquire industrial buildings within TRCC. These joint ventures currently operate five fully leased industrial buildings occupying over 2.8 million rentable square feet.

We formed a joint venture with Dedeaux Properties in the fourth quarter of 2024 to develop, lease and manage an approximately 510,385 industrial building within TRCC - East, subject to the execution of construction financing.

We are involved in a joint venture with Rockefeller Development Group, or RDG, as of December 31, 2025. The TRCC/Rock Outlet Center LLC operates the Outlets at Tejon.

TRCC Entitlements

The following table summarizes total entitlements for TRCC as of December 31, 2025:

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The following is a summary of infrastructure costs related to the Company's commercial, retail and industrial real estate developments at TRCC as of December 31, 2025:

We believe we are well positioned for long-term value creation as we continue with our current development plans at TRCC. This is evident in the 157% increase in land prices achieved over a eight-year period starting with $3.50 per square foot in 2017. Industrial rents have increased 248% over the same eight-year period starting at $0.25 per square foot in 2017. Current entitlements available at TRCC can facilitate alternative uses and further increase the per-acre value.

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Commercial/industrial Real Estate Development Market Overview

The logistics operators currently located within TRCC have demonstrated success in serving all of California and the western region of the United States, and we are building on their success in our marketing efforts. We will continue to focus our marketing strategy for TRCC on the significant labor and logistical benefits of our site, the pro-business approach of Kern County, and the success of the current tenants and owners within our development. Our strategy fits within the logistics model that many companies are using, which favors large, centralized distribution facilities which have been strategically located to maximize the balance of inbound and outbound efficiencies, rather than several decentralized smaller distribution centers. Operators located within TRCC have demonstrated success through utilization of this model. With access to markets of over 40 million people for next-day delivery service, they are also demonstrating success with e-commerce fulfillment.

We believe that our ability to provide fully-entitled, shovel-ready land parcels to support buildings ranging from 10,000 square feet to more than two million square feet, provides us with a marketing advantage. Our marketing efforts target industrial users in the Santa Clarita Valley of northern Los Angeles County, and the northern part of the San Fernando Valley, for whom we may be an attractive location due to the limited availability of new product and high real estate costs in these locations. Tenants in these geographic areas are typically users of smaller facilities, but often are looking to expand operations and cannot find larger size buildings in these markets. We are also targeting larger users in the Inland Empire, east of Los Angeles, that are looking to relocate to lower their operating costs.

We continue to closely monitor new construction, specifically speculative construction in comparison to pre-lease and build to suit. The commercial/industrial real estate sales market is highly competitive, with competition throughout California. The principal factors of competition in this industry are price, availability of labor, proximity to the port complexes of Los Angeles and Long Beach and customer base. While TRCC is farther from the ports of Los Angeles and Long Beach than the Inland Empire West, the relative importance of port proximity has moderated in recent periods. At the same time, eastward expansion of industrial development has shifted tenant demand further inland. These dynamics have reduced the historical premium associated with locations closest to the ports and have enhanced the competitiveness of TRCC. In addition, TRCC’s direct Interstate 5 frontage, fully entitled and shovel-ready land, and Kern County’s pro-business incentive programs may further support its competitiveness among industrial users evaluating inland distribution alternatives.

Our most direct regional competitors are in the Inland Empire, a large industrial area located 60 miles east of Los Angeles, which continues its expansion eastward beyond Riverside and San Bernardino into the Perris, Moreno Valley, and Beaumont regions of Southern California. We also face competition within Northern Los Angeles, which is comprised of the San Fernando Valley and Santa Clarita Valley along with areas north of us in the San Joaquin Valley of California. Strong demand for large distribution facilities is driving development farther east of these counties in the search for large, entitled parcels, often increasing transportation costs and lead times for companies reliant on port access. As development in the Inland Empire continues to move east and farther away from the ports, we believe that our strategic location, with direct access to major transportation corridors and proximity to the ports, positions us as a competitive alternative for logistics, warehousing, and distribution operations.

The Inland Empire industrial market is navigating a period of significant supply-side pressure and cooling demand. The vacancy rates climbed to 7.6%, an 80-basis point increase year-over-year. The downward trend in average asking rents have begun to slow, dropping by $0.01 per square foot (0.9%) quarter-over-quarter and $0.11 per square foot (9.6%) from one year ago to $1.04 per square foot. The San Fernando Valley and Ventura County industrial markets continue to see somewhat tight conditions. The vacancy rate in the San Fernando Valley increased by 110 basis points year-over-year to 3.6%, while vacancy in Ventura County increased by 130 basis points to 3.5%. Average asking rents remained unchanged at 2024 year-end. Rents in the San Fernando Valley and Ventura County remain among the highest submarkets in Los Angeles County, trailing only the South Bay.

Industrial users seeking larger spaces are going further north into neighboring Kern County, and particularly TRCC, which has attracted increased attention as market conditions continue to tighten. Additionally, TRCC is in a position to capture tenant awareness due to our ability to provide a competitive alternative for users in the Inland Empire and the Santa Clarita Valley,

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however, there can be no assurance that these advantages will offset market vacancy increases, rent softening, regulatory constraints, tenant consolidation trends or competitive development activity.

Given California’s regulators' recent efforts at the local and state levels to tighten restrictions on industrial zoning and specific industrial uses, we anticipate further legislative activity in this area. The Company’s existing and planned developments are designed to align with current regulatory requirements, while incorporating flexibility where possible to adapt to future policy changes. Through our Company advocacy strategies, Tejon Ranch will engage to influence policy discussions to support our industrial development goals.

Multifamily

Terra Vista at Tejon

In 2021, the Kern County Board of Supervisors approved a Conditional Use Permit (“CUP”) authorizing the development of a multifamily apartment community within TRCC. The approved CUP permits the Company to develop up to 495 multifamily residences in thirteen apartment buildings, together with approximately 6,500 square feet of community amenity space and 8,000 square feet of community-serving retail (collectively, “Terra Vista at Tejon”). The community is situated on a 22-acre site immediately north of the Outlets at Tejon.

The first phase of Terra Vista at Tejon was completed in 2025 and represents the first phase of development, consisting of 228 units. The project represents the first newly constructed, professionally managed multifamily community within TRCC and introduces a product type that is limited within the immediate South Bakersfield submarket, where there has been relatively modest recent multifamily development. The community includes amenity offerings typical of newly delivered apartment properties, including a resort-style pool, fitness center, resident lounge, and other common-area facilities.

Leasing commenced in May 2025. As of December 31, 2025, the project was approximately 63% leased. Residential leases have an average term of approximately 12 months. As of March 19, 2026, the project was approximately 71% leased, reflecting continued absorption as the community progresses toward stabilization. Terra Vista at Tejon represents the first residential component of TRCC and is intended to provide housing opportunities for employees working at distribution centers, retail establishments, hotels, and restaurants located within TRCC.

We are positioning our Multifamily platform to benefit from employment activity associated with logistics, distribution, and related service uses along key transportation corridors serving TRCC and the surrounding region. The greater Bakersfield rental market is generally characterized by relative affordability compared to major coastal California markets. Demand for rental housing in the region is influenced by local employment levels, household formation trends, the cost of homeownership, and the timing and volume of new multifamily supply.

Consistent with industry practice, we monitor key operating metrics, including physical occupancy, leasing activity, renewal rates, concessions, and changes in asking rents. Given the typical 12-month lease structure in the apartment industry, rental rates may adjust to prevailing market conditions over relatively short periods. Properties in lease-up are subject to market absorption levels, competitive supply conditions, and broader economic factors, and the timing of stabilization may vary accordingly.

Real Estate - Resort/Residential

Our resort/residential segment activities include land entitlement, land planning and pre-construction engineering, and land stewardship and conservation activities. We have three major resort/residential communities within this segment at various stages of entitlement and development:

•Mountain Village at Tejon Ranch

•Grapevine at Tejon Ranch

•Centennial at Tejon Ranch

•Grapevine North

MV and Grapevine received project approvals and entitlements. We are continuing entitlement and planning activities for Centennial. Grapevine North is currently utilized for agricultural operations and is not in active development.

The entitlement process precedes the regulatory approvals necessary for land development and routinely takes several years to complete. Litigation by environmental and other special interest groups has been a primary cause of delays and increased costs

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for our real estate development projects as well as other projects in California. For discussion on legal matters pertaining to our developments, see Note 13 (Commitments and Contingencies) of the Notes to Consolidated Financial Statements.

Full build out of our mixed-use master planned communities is expected to take 25 years or longer from the start of construction. We are unable to determine anticipated completion dates with certainty given the inherent complexity of the entitlement process in California, which requires approvals at federal, state, and county levels.

Macroeconomic conditions, including labor costs, raw material expenses, and inflation, also influence the timing and cost of development. We have obtained entitlements on MV and prevailed in litigation in 2012, and Grapevine was reapproved unanimously by the Kern County Board of Supervisors in 2019 and prevailed in litigation in 2021.

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Mountain Village at Tejon Ranch

MV is planned as a low-density, resort-based mixed-use community encompassing 26,417 acres, including 5,082 acres for a master planned community with housing, lodging, retail, and commercial components. MV is entitled for 3,450 homes, 160,000 square feet of commercial development, 750 hotel keys, and 21,335 acres of open space. The first final map for the project consisting of 401 residential lots and parcels for hospitality, amenities, and public uses was approved by Kern County in December 2021.

The commercial component of the project is a 160,000 square foot commercial center known as Farm Village (shown above), which will serve as the community's commercial hub. In 2018, we obtained commercial site plan approval from Kern County for the first phase of the Farm Village consisting of 53,180 square feet.

Timing of MV development in the coming years will be dependent on the strength of both the economy and the residential real estate market. We are currently pursuing capital financing opportunities for the development of MV. Such financing opportunities could come from a variety of sources, such as joint ventures with financial partners, debt financing, or equity financing.

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Grapevine at Tejon Ranch

Grapevine is a mixed-use master planned community encompassing 8,010 acres of our lands within Kern County located on the San Joaquin Valley floor, adjacent to TRCC. Grapevine is entitled for 12,000 homes, 5.1 million square feet for commercial development, and more than 3,367 acres of open space and parks. The 4,643 acres designated for mixed-use development will include housing, retail, commercial, and industrial components. The Company is focused on Planning Area 6A, a 620 acre sub-area of the larger 8,010 acre project area that lies immediately southeast of TRCC, proximate to the Company’s existing development and infrastructure. The Company is working to develop land planning, engineering, and technical analysis that will serve as the foundation for subdivision mapping for the development of the initial phase of Grapevine. Subdivision mapping is expected to start in 2026 and continue to 2028, with horizontal infrastructure development and vertical construction to follow. The Company also continues to work to obtain resource permits for the development of Grapevine, including permits from CA Department of Fish and Wildlife as well as the CA Regional Water Quality Control Board, and federal permitting from the US Fish and Wildlife Service.

Grapevine North

Immediately northeast of Grapevine is Grapevine North, a 7,655-acre development area, which is currently used for agricultural purposes. Identified as a development area in the RWA, Grapevine North presents a significant opportunity for future development. Grapevine North may feature mixed-use community development similar to Grapevine at Tejon Ranch, or other development uses as appropriate based upon market conditions at the time.

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Centennial at Tejon Ranch

The Centennial development is a mixed-use master planned community development planned to encompass 12,323 acres of our land within Los Angeles County. Centennial is being entitled for 19,333 housing units, including nearly 3,500 affordable units, and 10.1 million square feet of commercial development. The project is being developed by Centennial Founders, LLC, a consolidated joint venture in which we have a 93.84% ownership interest as of December 31, 2025. Centennial is envisioned to be an ecologically friendly community that will achieve a job-housing balance.

Centennial had entitlements that were initially approved in 2019 by the Los Angeles County Board of Supervisors. These approvals were litigated in two lawsuits filed in Los Angeles County Superior Court in May 2019. In January 2022, the Superior Court issued a decision rescinding the Centennial project approvals, which decision was upheld on appeal pursuant to a written Court of Appeal decision issued on June 26, 2025. On December 2, 2025, LA County rescinded and set aside the Centennial approvals. The Company is in the process of working with Los Angeles County to advance the Centennial project and has begun the process to re-entitlement of the Centennial project (“re-entitlement”). We expect that re-entitlement will involve processing project and land use entitlements that are substantively similar to the Centennial approvals that were approved in April of 2019, while addressing the matters adjudicated in the litigation. See Note 13 (Commitments and Contingencies) of the Notes to Consolidated Financial Statements for further discussion.

The principal competition for Centennial and Grapevine is expected to come from developments in the Santa Clarita Valley, Lancaster, Palmdale, and Bakersfield. We intend to differentiate our communities through our unique settings, land planning and product offerings. MV will compete generally for discretionary dollars that consumers will allocate to recreational and residential homes.

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The following is a summary of the Company's residential real estate developments as of December 31, 2025:

1 Estimated completion anticipated to be 25 years, or longer, from commencement of construction. To-date construction has not begun.

2 MV also has approval for up to 750 lodging units and 350,000 square feet of amenity facilities and two 18-hole golf courses.

3 Dollars presented in thousands.

4 Project being entitled. See Commitments and Contingencies Footnote 13.

Mineral Resources

Our mineral resources segment consists of oil and gas royalties, rock and aggregate royalties, royalties from a cement operation leased to National Cement Company of California, Inc., or National, and the management of water assets and water infrastructure. We continue to look for opportunities to grow our mineral resource revenues through expansion of leasing and encouraging new exploration. The management of our water assets consists of the evaluation of near-term highest and best uses, which can include the sale of water on a temporary basis, the use of water for internal purposes, and the storage of water for future use in our development projects. At the same time, we are also evaluating opportunities as they arise for the purchase of additional water assets as we have done in the past.

Royalty rates are contractually defined and based on a percentage of production and are received in cash. Our royalty revenues fluctuate based on changes in the market prices for oil, natural gas, and rock and aggregate product, the inevitable decline in production of existing wells and quarries, and other factors affecting the third-party oil and natural gas exploration and production companies that operate on our lands, including the cost of development and production.

We lease certain portions of our land to oil companies for the exploration and production of oil and gas. We do not engage in any oil exploration or extraction activities. As of December 31, 2025, 12,015 acres were committed to producing oil and gas leases from which the operators produced and sold approximately 67,441 barrels of oil and 13,088 MCF (each MCF being 1,000 cubic feet) of dry gas during 2025. Our share of production, based upon average royalty rates during the last three years, has been 27, 31, and 34 barrels of oil per day for 2025, 2024, and 2023, respectively. There are 293 active oil wells located on the leased land as of December 31, 2025. Royalty rates on our leases averaged approximately 15% of oil production in 2025. While California’s permitting framework and regulatory environment have historically constrained new exploration and expansion of oil production, recent actions at the state and county levels have introduced measures that may support continued operations and, in certain circumstances, facilitate production activities. The net impact of these evolving regulatory dynamics on the Company’s mineral resources segment remains uncertain. In addition, the Company does not estimate oil and gas reserves, and our lessees do not provide us with reserve information, which further limits visibility into the long-term production potential of our mineral interests.

Average monthly oil prices trended lower through much of 2025, with pricing decreasing from higher levels in the early part of the year and moving toward lower average prices later in 2025. For example, monthly average Midway-Sunset crude prices declined from approximately $74.5 per barrel in January 2025 and $71.4 per barrel in February 2025 to approximately $60.3 per barrel in May 2025, before stabilizing in the range of approximately $63.90 to $64.30 per barrel from June through August 2025, reflecting changes in regional and broader crude supply and demand conditions. Oil and natural gas prices are highly sensitive to fluctuations driven by relatively minor shifts in supply and demand, market uncertainty and various external factors beyond our control. These include changes in domestic and global supply and demand dynamics, domestic and global inventory levels, and political and economic conditions. Additionally, geopolitical tensions, including ongoing conflicts in the Middle East and Eastern Europe, further contribute to price volatility.

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We have approximately 2,000 acres under lease to National for the purpose of manufacturing Portland cement from limestone deposits found on the leased acreage. National owns and operates a cement manufacturing plant on our property with a production capacity in excess of 1,000,000 tons of cement per year. The amount of payment that we receive under the lease is based upon shipments from the cement plant. The term of this lease expires in 2026, however National has options to extend the lease until 2095.

We also lease 277 acres to Granite Construction and 244 acres to Griffith Construction for the mining of rock and aggregate product that is used in construction of roads and bridges. The royalty revenues we receive under this arrangement are based upon the amount of product produced at these sites. The Granite site reached the end of its economic life and began restoration activities during 2023. We also have a royalty arrangement with Granite Construction tied to 703 acres of land previously owned by the Company that began operations in 2021 and is now paying royalty payments, which will more than offset the payments that had been received from the old Granite site.

Water sales opportunities each year are impacted by rain and snowfall volume along with California State Water Project, or SWP, allocations. The current SWP allocation is at 30% of contract amounts with an expectation that the allocation may increase.

In 2015, we entered into a water sale agreement with PEF, our current lessee under a power plant lease. PEF may purchase from us up to 3,500-acre feet of water per year through July 2030, with an option to extend the term. PEF is under no obligation to purchase water from us in any given year but is required to pay us an annual option payment equal to 30% of the maximum annual payment. The price of the water under the agreement is subject to 3% annual increases for the duration of the lease agreement. The Company's commitments to sell this water can be met through current water sources.

Farming Operations

In the San Joaquin Valley, we farm permanent crops including the following acreage: wine grapes— 1,036 (all in production); almonds—1,962 (1,350 in production and 612 under development); and pistachios—932 (all in production). We also have 150 acres of olives currently under development and plan to plant an additional 150 acres of olives in 2026 as part of our ongoing diversification efforts. We periodically lease 530 acres of land that is used for row crops which can also be used for the development of permanent crops, such as almonds.

Pricing for nut and grape crops is particularly sensitive to the size of each year’s world crop, prior year inventory carry forward, and demand for those crops. The almond industry's final projection for 2025 yields is about 2.7 billion pounds. This estimate along with a lower inventory carry forward helped to improve pricing for the 2025 crop year.

Weather conditions directly affect tree and vine performance, particularly through the number of dormant or “chill” hours required for proper bud development and crop set. During the most recent growing season, we experienced sufficient chill hours and generally favorable, predictable weather patterns without significant unusual weather events. Unlike 2024, when extreme summer heat and late spring rains during grape bloom negatively impacted production and increased cultural costs due to higher mildew pressure. The ultimate impact of weather conditions on 2026 production, however, will not be fully known until the growing season progresses and harvest results are realized in the summer of 2026.

Labor costs, both internal and through labor contractors, continue to increase and the Company expects this trend to continue over the foreseeable future. The Company utilizes external labor contractors, as necessary, for large projects, such as pruning and harvesting, as a way to manage our labor needs. From a broader inflationary standpoint, the Company is seeing and expects to continue to see an increase in production costs, most notably chemicals such as herbicides and pesticides, and fuel costs. Winter chill hour accumulation to date has been below historical averages, which may affect bloom timing and crop development. In addition, the Company’s pistachio orchards are expected to be in a down-bearing year, consistent with the crop’s natural alternate bearing cycle, which may result in lower production compared to the prior year. As with all specialty crops, final yields will depend on spring weather conditions, including the potential impact of late-season rains and wind during bloom. The Company believes that tighter industry inventories may help support commodity pricing, partially offsetting production variability.

Sales of our grape and pistachio crops typically occur in the third and fourth quarters of the calendar year. Sales of our almond crop also typically occur in the third and fourth quarters of the calendar year but can occur up to a year or more after the crop is harvested. In 2025, we sold 58% of our grape crop to one winery, 32% to a second winery and the remainder to one other customer. These sales are under contracts ranging from one to eight years, which provides revenue visibility and helps mitigate counterparty risk through multi-year contractual arrangements. In 2025, our almonds were sold to various commercial buyers, with the largest buyer accounting for 24% of our crop. We believe that we would not be adversely affected by the loss of any or all of these buyers, because of the markets for these commodities, the large number of buyers that would be available to us, and the fact that the prices for these commodities do not vary based on the identity of the buyer or the size of the contract.

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At this time, the State Department of Water Resources has announced that the estimated water supply for 2026 will be at 30% of full entitlement. This allocation may change based upon precipitation and snowpack runoff in Northern California from additional potential winter storms. The current 30% allocation of SWP water is enough for us to farm our crops when combined with our other water sources. We have additional water resources, such as groundwater and surface sources, and those of the water districts we are in that allow us to have sufficient water for our farming needs. It is too early in the year to determine the impact of 2026 water supplies on 2026 California crop production for almonds, pistachios, and wine grapes. See discussion of water contract entitlement and long-term outlook for water supply under Item 2, “Properties.” Also see Note 6 (Long-Term Water Assets) of the Notes to Consolidated Financial Statements for additional information regarding our water assets.

Ranch Operations

Our ranch operations segment consists of grazing lease revenues, game management revenues, land maintenance activities, and ancillary land uses, such as filming.

Approximately 256,000 acres are used for two grazing leases, which account for 41% of total revenues from ranch operations at December 31, 2025.

Game management offers a wide variety of guided big game hunts, including trophy Rocky Mountain elk, deer, turkey and wild pig. We offer guided hunts and memberships for both the Spring and Fall hunting seasons and also have bird hunting memberships through the High Desert Hunt Club which operates out of the historic Beale Adobe.

In addition, the Ranch Operations segment manages, and includes the expenses for the upkeep, maintenance, and security, of all 270,000 acres of land.

General Environmental Regulation

Our operations are subject to federal, state, and local environmental laws and regulations, including laws relating to water, air, solid waste, and hazardous substances. There can be no assurance that we will not incur costs, penalties, and liabilities, including those relating to claims for damages to property or natural resources, resulting from our operations. Environmental liabilities may also arise from claims asserted by adjacent landowners or other third parties. We also expect continued legislation and regulatory development in the area of climate change and GHG. It is unclear, as of this date, how any such developments will affect our business. Enactment of new environmental laws or regulations, or changes in existing laws or regulations or the interpretation of these laws or regulations, might require expenditures in the future. We historically have not had material environmental liabilities.

Environmental Sustainability

Environmental stewardship and sustainability are core values at Tejon Ranch Co., along with quality, visionary innovation and development. The initiatives and objectives described below reflect our current plans and aspirations and are subject to change based on technological, regulatory, economic, and market conditions. There can be no assurance that such objectives will be achieved as currently contemplated or at all.

Climate Change

The Company maintains policies intended to both reduce its carbon footprint and proactively sequester, or capture and store carbon.

•Since 2008, the Company has voluntarily conserved 240,000 acres of its land covered by trees and other vegetation. An analysis conducted in 2020 for the Company by Dudek Environmental Services determined that this acreage effectively sequesters 3.3 million tons of carbon. That equals the volume of carbon produced in a single year by 2.5 million passenger vehicles, approximately 5% of California’s 2022 passenger vehicle fleet.

•Solar power is used significantly within TRCC. For example, the Company installed a solar-covered parking structure at the Outlets at Tejon. The structure covers 1.85 acres and is projected to reduce by approximately 83% the outlet center’s electricity consumption needs for shared spaces and produce approximately 1,076,000-kilowatt hour, or kWh, of clean energy every year. In addition, the IKEA distribution center at TRCC features a 1.8 MW photovoltaic solar array covering 370,000 square feet of the warehouse’s rooftop. The system handles the power needs of IKEA’s distribution center and provides power to the electrical grid as well. Caterpillar’s distribution center in TRCC utilizes a ground-based solar array to reduce its energy usage. The Company also installed solar-covered parking structures at Terra Vista at Tejon. The structure covers 0.25 acres and is projected to reduce by approximately 100% Terra Vista's electricity consumption needs for shared spaces and produce approximately 223,000-kilowatt hour, or kWh, of clean energy every year.

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•The Company also leases land to Calpine Energy, a power generating company, which is completing the development of a 600-acre industrial-sized solar field. Located immediately adjacent to Calpine’s Pastoria Energy Facility, a natural gas and steam powered generating plant on leased land in the San Joaquin Valley portion of Tejon Ranch, the solar array is expected to produce approximately 100 MW of power once fully operational.

•TRCC is important to the growth of electric vehicle usage, as it contains one of the largest Tesla Supercharger stations in the country. Combined, the west and east sides of TRCC contain nearly 100 superchargers. The facility is owned by the Company.

•The Company’s master planned mixed-use residential communities are designed with a jobs housing balance that will locate housing near employment centers, reducing commuting miles. Centennial is designed to include electric vehicles, through vehicle purchase incentives. Centennial development plans include approximately 23,000 EV charging locations within residential and commercial areas of the community, and support for the installation of an additional approximately 5,000 EV chargers within disadvantaged communities in the greater Los Angeles metropolitan area. In addition, approximately 100 EV chargers are planned at TRCC to support medium- and heavy-duty trucks. Centennial's development plans also include on-site renewable energy generation intended to supply approximately 50% of the community’s energy needs. Residential units at Centennial and Grapevine are planned to operate without natural gas service, while limited natural gas use may be permitted for certain essential commercial applications.

•At Grapevine, like Centennial, 50% or more of its energy supply is intended to be produced on site by renewable sources, and natural gas will not be installed in homes.

•All homes in MV will feature roof-top photovoltaic solar arrays and battery energy storage systems, where required by code.

Air Quality

•The Company has contracted with the San Joaquin Valley Unified Air Pollution Control District, or SJVUAPCD, to pre-mitigate air emissions including GHG emissions related to the Company’s current development at TRCC-East and future development at MV and Grapevine. As part of this effort, in 2021, SJVUAPCD facilitated emissions reduction projects related to TRCC-East and identified measures to address projected future emissions for the full build-out of the project. Additionally, for the initial phase of development at MV, the Company has contributed funding to support the replacement of outdated agricultural engines, which is expected to reduce certain air emissions in the region.

•Two decades ago, the Company helped establish and has continued to support Valley Clean Air Now, or ValleyCAN, a non-profit, 501(c)(3) public charity that advances quantifiable and voluntary solutions addressing air pollution in California’s San Joaquin Valley, a region with some of the worst air quality and highest poverty levels in the United States. The Company continues to support ValleyCAN in its mission to improve public health and quality of life in disadvantaged communities located in the region.

Water Conservation

•At TRCC-East, water used for irrigation purposes is reclaimed from the water treatment plant. Landscaping at the Outlets at Tejon consists of drought-tolerant, native planting material.

•Each of the Company’s master planned, mixed-use residential communities will feature state-of-the-art water conservation measures, reclaimed water for irrigation, stormwater capture, and drought-tolerant landscaping.

•The Company’s agricultural operations utilize highly efficient automated and drip irrigation systems to water its orchards and vineyards. This allows for increased control and flexibility in crop irrigation as well as real-time monitoring.

•We use water banks for water storage in the water basins in which we have operations which allows us to better manage our vital water resources more efficiently.

•The majority of the Company’s developed land, including farming, lies within the White Wolf Groundwater Subbasin (basin ID 5-022.18), which is considered a non-critically overdrafted basin and has a Groundwater Sustainability Plan (GSP) approved by the California Department of Water Resources.

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Customers

Our PEF power plant lease accounted for 9% of total revenues in 2025, 11% in 2024 and 11% in 2023. No other recurring customer represented 5% or more of our revenues in 2025, 2024 and 2023.

Organization

Tejon Ranch Co. is a Delaware corporation incorporated in 1987 to succeed the business operated as a California corporation since 1936.

Human Capital

At December 31, 2025, we had 65 full-time employees and five part-time employees. We believe our employees are among our most important resources and are critical to our continued success. We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations. To attract and retain top talent, we have designed our compensation and benefits programs to provide a balanced and effective reward structure. Our short and long-term incentive programs are aligned with key business objectives and are intended to motivate strong performance. Our employees are eligible for medical, dental and vision insurance, a 401(k) savings/retirement plan, employer-provided life and disability insurance and an array of voluntary benefits designed to meet individual needs. We have adopted a Compliance with State and Federal Statutes, Rules and Regulations Reporting Policy that applies to all of our employees. Its receipt and review by each employee are documented and verified quarterly. None of our employees are covered by a collective bargaining agreement.

Our policies are designed to promote fairness and equal opportunities within the Company. When attracting, developing and retaining talent, we seek individuals who hold varied experiences and viewpoints and embody our core values to create an inclusive culture and workplace that allows each employee to do their best work and drive our collective success. We believe that an experienced and varied workforce possesses a broader array of perspectives that businesses need to remain competitive in today’s economy. We maintain employment policies that comply with federal, state and local labor laws and promote a culture of respect. These policies set forth our goal to provide opportunities without discrimination or harassment on the basis of protected categories. All of our employees must adhere to a Code of Business Conduct and Ethics that sets standards for appropriate behavior, and all employees must also complete required internal training on respect in the workplace to further enhance our cultural behaviors.

Reports

We make available, free of charge through our Internet website, www.tejonranch.com, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to these reports filed or to be furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to the SEC. We also make available on our website our corporate governance guidelines, charters of our Board of Directors’ Committees (audit, compensation, nominating and corporate governance, and real estate), and our Code of Business Conduct and Ethics for Directors, Officers, and Employees. These items are also available in printed copy upon request. We intend to disclose in the future any amendments to our Code of Business Conduct and Ethics for Directors, Officers, and Employees, or waivers of such provisions granted to executive officers and directors, on the website within four business days following the date of such amendment or waiver. Any document we file with the SEC may be inspected, without charge, at the SEC’s website: http://www.sec.gov.

Information about our Executive Officers

The following table shows each of our executive officers and the offices held as of March 19, 2026, the period the offices have been held, and the age of the executive officer.

A description of present and prior positions with us, and business experience is given below.

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Mr. Walker joined the Company on March 6, 2025 as Chief Operating Officer, as previously announced. He succeeded Gregory S. Bielli, becoming President and Chief Executive Officer as of April 1, 2025. Prior to joining the Company, Mr. Walker served as Executive Vice President at Lowe, a private real estate company, overseeing the firm’s hospitality and resort community platform from 2000 to 2025. Prior to joining Lowe, Mr. Walker held positions at several architectural firms. Mr. Walker earned a Bachelor of Architecture from Cornell University and a Master of Business Administration from the UCLA Anderson School of Management.

Mr. McMahon joined the Company in November 2001 as Director of Financial Analysis. In 2008, Mr. McMahon became Vice President of Commercial/Industrial Development and in December of 2014, was promoted to Senior Vice President of Commercial/Industrial Development and elected as an officer of the Company. In 2015, he was promoted to Executive Vice President. Mr. McMahon's title was subsequently changed in 2017 to Executive Vice President, Real Estate.

Mr. Velasquez joined the Company as Vice President of Finance in 2014. Mr. Velasquez's title was subsequently changed, in 2015, to Vice President of Finance and Chief Accounting Officer to more accurately describe the responsibilities of his office. In 2025, he was promoted to Chief Financial Officer. Prior to joining the Company, Mr. Velasquez served as an Executive Director at Ernst & Young in their audit and assurance practice section. Mr. Velasquez worked with Ernst & Young from 1999 through 2014. Mr. Velasquez holds a B.S. in Business Administration – Option: Accounting from California State University, Los Angeles. Mr. Velasquez is a Certified Public Accountant in the state of California. On January 1, 2018 he was promoted to Senior Vice President, Finance and Chief Accounting Officer. On January 1, 2019, he was appointed Chief Financial Officer and served in that role until March 2022. In 2022, he was given the title of Chief Accounting Officer. In July of 2025, he was appointed again to Chief Financial Officer and Treasurer.

Mr. Houston rejoined the Company in August 2023 as Senior Vice President, General Counsel & Secretary. Mr. Houston joined the Company in May 2016 as the Senior Vice President, General Counsel. In January 2021, Mr. Houston left the Company and worked with the Southern California Association of Governments, a metropolitan planning organization, as their Chief Counsel and Director of Legal Services. He previously worked for the City of Anaheim, where he served as City Attorney from 2013 through 2016. His background involves extensive experience in corporate governance, municipal law, real estate, land use and environmental issues. Prior to working for the City of Anaheim, he served as a partner for a Newport Beach, CA-based law firm of Cummins & White from 2011 to 2013, and prior to that, was a partner at Rutan & Tucker, LLP, Costa Mesa, CA.