NOTE 15 – SUBSEQUENT EVENT

The Company announced in March 2021 the launch of a new line of business which will be referred to as Build-to-Rent (“BTR”). BTR is expected to represent as a separate reporting segment and will be presented once material. Previously reported financial information for the current segments will not change as a result of the new segment.

During the initial development phase of Sky Ranch, the Company retained ownership of three residential lots, on which the Company has begun building three single family homes which Pure Cycle will own, maintain and rent to qualified renters. The Company has contracted out the construction to a local construction company and expects these three homes to be completed and ready for renters in the fall of 2021. After the successful completion and operational start up of the three houses in the first phase, the Company intends to expand this BTR line in the second development phase of Sky Ranch by building and renting homes on the 106 lots that were not sold to the Company's home builder partners. Grading on the second phase of Sky Ranch has begun, and once complete the Company will look to partner with certain builders to construct additional BTR units as the second development phase of Sky Ranch is completed.