UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

[X]☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 20212022

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

For the transition period from __________ to __________

Commission File No. 000-55445

DREAM HOMES & DEVELOPMENT CORPORATION

(Exact Name of Registrant As Specified In Its Charter)

314 South Main StreetForked River, New Jersey08731

(Address of Principal Executive Offices and Zip Code)

609693 8881

Registrant’s Telephone Number, Including Area Code:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [  ] ☐ No [X] ☒

Indicate by check mark whether the registrant has submitted every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [  ] ☐ No [X] ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer [  ]☐ Accelerated Filer [  ] ☐ Non-Accelerated Filer [  ] ☐ Smaller Reporting Company [X]☒

Emerging Growth Company [  ]☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes [  ] ☐ No [X] ☒

The number of shares outstanding of the registrant’s common stock, as of May 24, 2021,20, 2022 was 34,494,49335,824,493

DREAM HOMES & DEVELOPMENT CORPORATION

TABLE OF CONTENTS

DREAM HOMES & DEVELOPMENT CORPORATION

CONSOLIDATED BALANCE SHEETS

The accompanying notes are an integral part of these financial statements.

DREAM HOMES & DEVELOPMENT CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

ThreeFor the three Months Ended March 31, 2022 and 2021 and 2020 (Unaudited)

The accompanying notes are an integral part of these financial statement.

DREAM HOMES & DEVELOPMENT CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For the three months ended March 31, 20212022 and 20202021

(Unaudited)

The accompanying notes are an integral part of these financial statements.

DREAM HOMES & DEVELOPMENT CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three months ended March 31, 20212022 and 20202021

(Unaudited)

The accompanying notes are an integral part of these financial statements.

DREAM HOMES & DEVELOPMENT CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the three months ended March 31, 20212022 and 20202021

(Unaudited)

Note 1 - Significant Accounting Policies

Nature of Operations

Dream Homes & Development Corporation is a regional builder and developer of new single-family homes and subdivisions, as well as a market leader in coastal construction, elevation and mitigation. In the nineten years that have passed since Superstorm Sandy flooded 30,00040,000 owner-occupied homes, Dream Homes has helped hundreds of homeowners to rebuild or raise their homes to comply with new FEMA requirements.

In addition to the coastal construction market, Dream Homes will continue to pursue opportunities in new single and multi-family home construction, with 54 new developments totaling 265267 units in title, or under contract and in development. Dream Homes’ operations will include the development and sale of a variety of residential communities, including construction of semi-custom homes, entry-level and first time move-up single-family and multi-family homes.

HistoryA new trend in the real estate market which has experienced significant growth in the last year is the emerging Build To Lease trend. This focus and concentration on building both single and multi-family developments with the intention to lease them immediately upon completion is being made in response to several factors. One factor is the extreme shortage of rental properties on the market, not only for first time homemakers, but for retirees, and young professionals who are unclear as to the intentions of settling in one location. The second factor is the overall lender and funding source preference to lend to Build To Lease developments, as opposed to more traditional Build To Sell developments due to the perception of Build To Lease as a safer investment over the long term. Finally, the extraordinary amount of interest from non-traditional sources such as pension and hedge funds, insurance companies and venture capital firms to purchase completed new For Lease developments at attractive metrics based on capitalization rates has spurred a large growth in this market segment.

The Company has made the decision to change focus in their new home developments to better accommodate this growing trend. Currently all new multi-family developments located in Ocean County, which represent a total count of 155 units, will be changed from Build For Sale to Build for Lease. The Company now intends to hold these properties upon completion and lease-up for an indeterminate period of time, and realize the rental income from ownership. This strategy will become a very significant revenue stream for the Company and will become a third division of the Company, behind custom new homes and renovation/elevation projects.

History

Dream Homes & Development Corporation was originally incorporated as The Virtual Learning Company, Inc. (“Virtual Learning”) on January 6, 2009 as a Nevada corporation with 75,000,000 shares of capital stock authorized, of which 70,000,000 shares are common shares ($.001 par value), and 5,000,000 shares are preferred shares ($.001 par value).

On March 14, 2017, Virtual Learning changed its name to Dream Homes & Development Corporation (“DHDC”). DHDC maintains a web site at www.dreamhomesltd.com as well as a blog, located at http://blog.dreamhomesltd.com.

Principles of Consolidation

The consolidated financial statements include the accounts of DHDC and its wholly owned subsidiaries (collectively, the “Company”). All intercompany balances and transactions have been eliminated in consolidation.

Property and Equipment

Property and equipment is stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over an estimated useful life of five years.years. Repairs and maintenance costs are expensed as incurred, and renewals and betterments are capitalized.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates.

Fair Value of Financial Instruments

Fair value is defined as the price that we would receive to sell an asset or pay to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date. In determining fair value, GAAP establishes a three-level hierarchy used in measuring fair value, as follows:

● Level 1 inputs are quoted prices available for identical assets and liabilities in active markets.

● Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets and liabilities in active markets or other inputs that are observable or can be corroborated by observable market data.

● Level 3 inputs are less observable and reflect our own assumptions.

Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and loans payable to related parties. The carrying amount of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, and loans payable to related parties approximates fair value because of their short maturities.

Construction Contracts

Revenue recognition:

The Company adopted Accounting Standards Codification Topic 606, “Revenue from Contracts with Customers” (“ASC 606”) on January 1, 2018. In accordance with ASC 606, revenue is recognized when promised goods or services are transferred to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services, in accordance with the following five-step process:

For the periods presented prior to the adoption of ASC 606, revenues from long-term construction contracts were recognized in accordance with ASC Topic 605-35, “Revenue Recognition-Construction-Type and Production-Type Contracts.”

The Company recognizes construction contract revenue over time using the percentage-of-completion method, based primarily on contract cost incurred to date compared to total estimated contract cost. Cost of revenue includes an allocation of depreciation, amortization and general overhead cost. Changes to total estimated contract cost or losses, if any, are recognized in the period in which they are determined.

The Company generally provides limited warranties for work performed under its construction contracts with periods typically extending for a limited duration following substantial completion of the Company’s work on a project.

The Company classifies construction-related receivables and payables that may be settled in periods exceeding one year from the balance sheet date, if any, as current assets and liabilities consistent with the length of time of its project operating cycle. For example:

Contract liabilities

Costs and estimated earnings in excess of billings result when either: 1) costs are incurred related to certain claims and unapproved change orders, or 2) the appropriate contract revenue amount has been recognized in accordance with the percentage-of-completion accounting method, but a portion of the revenue recorded cannot be billed currently due to the billing terms defined in the contract. Claims occur when there is a dispute regarding both a change in the scope of work and the price associated with that change. Unapproved change orders occur when there is a dispute regarding only the price associated with a change in scope of work. For both claims and unapproved change orders, the Company recognizes revenue, but not profit, when it is determined that recovery of incurred cost is probable and the amounts can be reliably estimated.

Change in Estimates:

The Company’s estimates of contract revenue and cost are highly detailed and many factors change during a contract performance period that result in a change to contract profitability. These factors include, but are not limited to, differing site conditions: availability of skilled contract labor: performance of major material suppliers and subcontractors: on-going subcontractor negotiations and buyout provisions: unusual weather conditions: changes in the timing of scheduled work: change orders: accuracy of the original bid estimate: changes in estimated labor productivity and costs based on experience to date: achievement of incentive-based income targets: and the expected, or actual, resolution terms for claims. The factors that cause changes in estimates vary depending on the maturation of the project within its lifecycle. For example, in the ramp-up phase, these factors typically consist of revisions in anticipated project costs and during the peak and close-out phases, these factors include the impact of change orders and claims as well as additional revisions in remaining anticipated project costs. Generally, if the contract is at an early stage of completion, the current period impact is smaller than if the same change in estimate is made to the contract at a later stage of completion. Management focuses on evaluating the performance of contracts individually and uses the cumulative catch-up method to account for revisions in estimates. Material changes in estimates are disclosed in the notes to the consolidated financial statements.

Income Taxes

The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the provision for income tax in the statements of operations. The Company evaluates the probability of realizing the future benefits of its deferred tax assets and provides a valuation allowance when realization of the assets is not reasonably assured.

The Company recognizes in its financial statements the impact of tax positions that meet a “more likely than not” threshold, based on the technical merits of the position. The tax benefits recognized from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement.

Net Income (Loss) Per Common Share

Basic net income (basic net loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period.

Diluted net income (loss) per common share is computed using the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period.

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Accounting Standards Codification “ASC” Topic 606). The purpose of this ASU is to converge revenue recognition requirements per GAAP and International Financial Reporting Standards (“IFRS”). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments in this ASU were originally effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption not permitted by the FASB; however, in August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date after public comment respondents supported a proposal to delay the effective date of this ASU to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. We adopted this ASU on January 1, 2018 and adoption of this ASU did not have a material impact on our financial position, results of operations and cash flows.

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” and subsequent amendments to the initial guidance: ASU 2017-13, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01 (collectively, “Topic 842”), which provides guidance for accounting for leases. Topic 842 requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on an effective interest rate method or on a straight line basis over the term of the lease. We are currently evaluating both the methodadopted this ASU on January 1, 2019 and theadoption of this ASU did not have a material impact of adopting this guidance on our Condensed Consolidated Financial Statements.financial position, results of operations and cash flows.

Certain other accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. The impact on the Company’s financial position and results of operations from adoption of these standards is not expected to be material.

2 - Property and Equipment

Property and equipment is summarized as follows:

Schedule of Property and Equipment

Depreciation expense for the three months ended March 31, 20212022 and 20202021 was $1,689 and $ 1,653,, respectively.

3-Deposits3- Deposits and Costs Coincident to Acquisition of Land for Development

Deposits and costs coincident to acquisition of land for development are summarized as follows:

Schedule of Deposits and Costs Coincident to Acquisition of Land for Development

Properties currently under contract to purchaseowned and in the development stage

Berkeley Terrace – Bayville, NJ – 70 approved townhome units

A contract was signed to acquire 70 approved townhome units in October 2019, after 31 months of discussion. Thisdiscussion, and the property iswas acquired in late June 2021. Site improvements are scheduled to closecommence in midsummer 2023. Sales or rental revenues are scheduled to late June 2021, at which time site improvements will commence. Sales will accrete to 2021, 2022 & 2023 – 2024 income. The Company has secured a bridge loan and is awaiting a commitmentactively working with aseveral permanent lender forlenders to finalize an acquisition, development and construction finance facility. Funding for land only has been secured at this time. Closing for this property

The Company is scheduled for midpreparing to late June 2021.begin infrastructure work on the property.

Lacey Township, New Jersey, “Dream Homes at the Pines”, Contract

Dream Homes is in contract and under development for a parcel which will yield 68 new townhomes in the Ocean County NJ area, of which 54 are market rate and 14 are affordable housing. The acquisition of the contract was made for common stock and occurred in the 4th quarter of 2016. This property is currently in the approval process. This development project is scheduled to begin in late 20212022 and will accrete to 20222023 sales.

All costs associated with this property necessary to obtain all approvals, acquire the land, install the infrastructure and prepare the property to commence construction are the Company’s responsibility.

In order to obtain all developmental approvals and be prepared to begin installing infrastructure, various permits and engineering work are required. These permits include but are not limited to township subdivision, county, municipal utility authority, CAFRA (NJ Department of Environmental Protection) and NJ Department of Transportation. To date, design engineering has been completed, and a CAFRA application has been prepared and submitted, to the environmental scientist, along with a check for $36,750 payable toand the NJ DEP. Application for this permit was made in April 2017. As of this date, the CAFRA application has been put on hold pending a determination if the township will be approved by the State of New Jersey forDEP issued a CAFRA Town Center designation. A Lacey Township Planning Board meetingpermit in October of 2021. Preliminary township approval was held on December 11, 2017. Additional information was requested from the board and the next meeting was heard for preliminary and final approvalgranted on April 19^th of 2021. Preliminary and Tentative Municipal Utilities Authority approvals have been granted. Ocean County Planning Board approval washas been granted. Lacey Township Fire Department approval has been granted.

It is anticipated that complete development approvals will cost approximately $20,000$20,000 more to complete. In addition to these approval costs and acquisition costs, infrastructure costs are anticipated to cost approximately $1,000,000. The total amount of funding required to acquire and make this$1,200,000, at which time the property will be ready for homevertical construction is approximately $1,900,000.to commence.

The Company may needis in active discussions with various lenders to seek loans from banks to financecomplete the infrastructure and vertical financing portions of this project. As part of their financing agreements, the banks typically require Vincent Simonelli to personally guarantee these loans. If Mr. Simonelli cannot qualify as a guarantor and there is no one other than him in the Corporation

The closing to provide those guarantees, the financing of the deal may be adversely affected. The exact amount of funding required foracquire this particular property is not clear at the present time but will be determined when full approvals have been obtainedoccurred on June 29, 2021 and the Company is prepared to take title to the property.currently in title.

As of February 26, 2021, financing has been secured to purchase the land upon municipal approvals being granted.Clayton NJ – 112 Apartments

Dream Homes Apartments

On May 3, 2018, the Company submitted a signed letter of intent to purchase 5.5 acres of property in Gloucester County, which is currently being approved for a 112-unit apartment complex, with 8000approximately 7600 square feet of retail space. The Company has a signed contract and has been proceeding with development approvals. The property is designated as a redevelopment property, and a redevelopment agreement is currently being negotiated with the township. Progress has been delayed due to township closures due to the Covid-19 pandemic.

On February 26, 2021, the Company took title to the property via an assemblage of 3 parcels.

The Company successfully obtained Redevelopment Approval from the Borough in July 2021 and Preliminary and Final Site Plan approval in December of 2021.

All outside agency approvals have been submitted for and are in process.

Louis Avenue – Bayville, NJ – Property being developedIn title

In October of 2018, the company entered into a contract to acquire and develop and acquireproperty for 17 townhouse lotsunits in Bayville NJ. Engineering and approvals are currently in process. Application was made to the Planning Board on March 20, 2020. The project was deemed complete by the township engineer. Municipal scheduling has beenwas delayed due to the Covid-19 virus. Thevirus, but the Company was heard before the Berkeley Township Planning Board on October 3, 2020 and the planning boardCompany was awarded preliminary approvals for 17 townhome units.. units.

Application is currently being preparedmade for final approvals. Theapprovals, and the Company is scheduled to acquirebe heard at the May 2022 planning board meeting. Subsequent event: The Company received Final approval on May 19, 2022.

The Company acquired this property on August 4, 2021.

The Company intends to develop, lease and retain this property in July of 2021.its portfolio for the foreseeable future.

Properties Under Contract to Purchase and in the Approval Stage

Autumn Run – Gloucester County

On December 7, 2018, the Company signed a contract to purchase a property in Gloucester County, NJ, which will be approved for +/- 63 units of age-restricted manufactured housing. The property is currently in the approval stage. An application was made to the DEP for a wetlands letter of interpretation, which was approved as proposed. Further action before the planning board is pending due to delays caused by township closures due to Covid-19. The Company had a virtual workshop meeting on September 15, 2020 and an additional virtual meeting was conducted on November 17, 2020.

The application for a use variance is beingwas heard on May 24, 2021.2021 and the variance was approved.

The Company is in the process of applying for preliminary and final site plan approval and should be heard at the July 2022 meeting.

Little Egg Harbor Township, New Jersey, “Dream Homes at Radio Road”, Contract

On March 14, 2018, the Company signed a contract to purchase 4 improved lots (1 lot has been sold) in Little Egg Harbor Township, NJ (the “Dream Homes at Radio Road”) for a total of $260,000. The Contract between the Company and the seller of the land provides for a $65,000 per lot purchase price with closing occurring on a rolling basis, as each house is built and sold. The Company intends to begin construction as buyers are secured and the homes are projected to sell in the $350,000 - $375,000 range.

Properties on hold due to delay in approvals, environmental concerns or other reasons

Berkeley Township, New Jersey, “Dream Homes at Tallwoods”, Contract

On March 1, 2017, the Company acquired from DHL rights to a contract to purchase over 7 acres of land in Berkeley Township, NJ (the “Tallwoods Contract or Dream Homes at Tallwoods”) for 71,429 restricted shares of Company common stock (issued in April 2017).

Since the transaction had not occurredMortgages on Properties Held for at least a portion of the Property within 12 months of the completion of the Due Diligence Period, as well as two 6-month extensions, the seller chose to terminate the contract. Though the Company retained the right to waive any remaining development contingencies and proceed to closeDevelopment:

Schedule Mortgages on the property, it was determined by senior management that the risk of acquiring an unapproved property was not acceptable.Properties Held for Development

4-Loans4-Loans Payable to Related Parties

Loans payable to related parties is summarized as follows:

Schedule of Loans Payable to Related Parties

All. Advances from the loans above are non-interest bearing and duebear interest at a rate of 12%, with interest being payable on demand. Accrued interest as of March 31, 2022 aggregate $ 24,450.

5 - Common Stock Issuances

On May 9, 2019, the Company issued 58,000 restricted shares of restricted common shares to two individuals for consulting services at $.10 per share.

On June 6, 2019, the Company issued 520,000 restricted shares for stock-based compensation at $.10 per share to six individuals.

On June 6, 2019, the Company issued 1,000,000 restricted shares for debt reduction to the Chief Executive Officer at $.10 per share.

On June 6, 2019, the Company issued 100,000 restricted shares for reduction of note payable at $.10 per share.

In March 2020, the Company issued 2,997,500 restricted shares for compensation valued at $ 119,500.119,500.

On September 25, 2020, the Company issued 110,000 restricted shares for debt reduction value at $7,700.$7,700.

On September 30, 2020, the Company issued 2,600,000 restricted shares for compensation valued at $ 78,000.78,000.

On October 28, 2020, the Company issued 48,000 restricted shares for compensation valued at $ 3.360.3,360.

On November 10, 2020, the Company issued 30,000 restricted shares for compensation valued at $ 1,800.1,800.

On February 11, 2021, the Company issued 2,830,000 restricted shares for compensation valued at $ 113,200.113,200.

On July 13, 2021, the Company issued 28,000 restricted shares for legal services valued at $ 14,000.

On October 22, 2021, the Company issued 500,000 restricted shares for compensation valued at $ 21,000.

On October 28, 2021, the Company issued 550,000 restricted shares for compensation valued at $ 22,600.

6 – Income Taxes

As a result of the Tax Cuts and Jobs Act (Tax Legislation) enacted on December 22, 2017, the United States corporate income tax rate is 21% effective January 1, 2018.

As of March 31, 20212022 the Company has available for federal and state income tax purposes a net operating loss carry forward that may be used to offset future taxable income.

7- Commitments and Contingencies

Construction Contracts

As of March 31, 2021,2022, the Company was committed under 23 20 construction contracts outstanding with homeowners and investors with contract prices totaling $ 7,520,018,8,504,668, which are being fulfilled in the ordinary course of business. None of these construction projects are expected to take significantly in excess ofover one year to complete from commencement of construction. The Company has no significant commitments with material suppliers or subcontractors that involve any sums of substance or of long-term duration at the date of issuance of these financial statements.

Employment Agreements

On May 8, 2017, DHDC executed an Employment Agreement with a Sales Manager. The original term of the agreement was from May 8, 2017 to May 8, 2019 and was renewable thereafter at 1-year1-year intervals based on certain sales targets. That agreement has been renewed and is currently in force. The agreement provides for compensation based on sales.

Lease Agreements

The Company has occupied office space located in Forked River, New Jersey. Commencing April 2017, the Company originally paid monthly rent of $2,000$2,000 for this office space. This amount was subsequently increased to $2,500$2,500 per month.

On February 28, 2020 the Company executed a lease for an office space located at 800 Riverview Drive in Brielle, which the Company feels will better serve the southern Monmouth clientele. The lease term is 2 years, and the total rent is $25,140.

The Company continues to operate an office/showroom located at 884 Rt. 9 in Little Egg Harbor.$25,140. This lease was originally incepted in November 2018,has been renewed and extended and is expected to continue into the Company continues to utilize the facility to service clients in Long Beach Island, Little Egg Harbor as well as points south.future.

Line of Credit

On September 15, 2016, DHDC established a $500,000$500,000 line of credit with General Development Corp., a non-bank lender. On September 15, 2021, DHDC increased the existing line of credit from $500,000 to $1,000,000. Advances under the line bear interest at a rate of 12%12%, with interest being payable on demand. The outstanding principal is due and payable in 60 months.months. The line is secured by the personal guarantee of the Company’s Chief Executive Officer. The agreement to fund automatically renews on a yearly basis as long as interest payments are current.current or as agreed. To date, the Company has received several advances under the line of credit. As of March 31, 2021,2022, the outstanding principal balance was $ 372,160. Interest expense913,160.

8. Related Party Transactions

Dream Homes Ltd. Allocated payroll

The Company uses the services of Dream Homes Ltd. (DHL) personnel for its operations. For the three months ended March 31, 2022 and 2021, the Company’s estimated share of DHL’s gross payroll and 2020 waspayroll taxes and include $ 9,33586,428 and $ 6,272,75,400, respectively.

8. Related Party Transactions

Office Space

The Company has occupied office space located in Forked River, New Jersey which is owned by an affiliated company. Commencing April 2017, the Company has paid monthly rent of $2,500 for this office space.

9 - Stock Warrants

Effective April 1, 2019, any previousThere are no outstanding warrants issued by the Company were cancelled.Company.

10 – Subsequent Events

Private Placement

On May 7, 2021,The Company has evaluated subsequent events through the date the financial statements were available to be issued. Other than items that may be noted herein, the Company released a Private Placement Memorandum, which consists of an equity and debt offering for up to $1,000,000 in new capital. This capital will be utilized for acquisition and development of several of the properties the Company has under contract. The offering is comprised of Units for sale as well as convertible debt. Each Unit is priced at $.20 per common share and includes 1 warrant to purchase an additional share of common stock for $.30 within 3 years of the date of Unit purchase. The convertible debt is offered at an 8% coupon, paid quarterly, has a maturity of 3 years and is convertible at $.75 per share. The offering is scheduled to close on November 7, 2021.

Otherhad no subsequent events have been detailed in respective categories herein.that require disclosure.

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This Quarterly Report on Form 10-Q and other written reports and oral statements made from time to time by the Company may contain so-called “forward-looking statements,” all of which are subject to risks and uncertainties. One can identify these forward-looking statements by their use of words such as “expect,” “plan,” “will,” “may,” “anticipate,” “believe,” “estimate,” “should,” “intend,” “forecast,” “project” the negative or plural of these words, and other comparable terminology. One can identify them by the fact that they do not relate strictly to historical or current facts. These statements are likely to address the Company’s growth strategy, financial results and product and development programs. One must carefully consider any such statement and should understand that many factors could cause actual results to differ from the Company’s forward-looking statements. These factors include inaccurate assumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-looking statement can be guaranteed and actual future results may vary materially. The Company does not assume the obligation to update any forward-looking statement. One should carefully evaluate such statements in light of factors described in the Company’s filings with the SEC, especially the Company’s Annual Report on Form 10-K and the Company’s Quarterly Reports on Form 10-Q. In various filings the Company has identified important factors that could cause actual results to differ from expected or historic results. One should understand that it is not possible to predict or identify all such factors. Consequently, the reader should not consider any such list to be a complete list of all potential risks or uncertainties.

Use of Terms

The following discussion analyzes our financial condition and results of operations for the three months ended March 31, 20212022 and 2020.2021. Unless the context indicates or suggests otherwise, reference to “we”, “our”, “us” and the “Company” in this section refers to the operations of Dream Homes & Development Corporation (DHDC),

PLAN OF OPERATION

Overview

Building on a history of over 1,6001,700 new homes built and over 400 elevation/renovations,renovation/addition projects since 1993, the management of Dream Homes & Development Corporation has positioned the company to emerge as a rapidly growing regional developer of new single-family homes & subdivisions as well as a leader in coastal new home and modular construction, elevation and mitigation.

The Company has been focusing recently on new single-family homes along the shore of New Jersey, both modular and site-built construction. DHDC is also working on development of new subdivisions in both Ocean and Gloucester counties.

In the years that have passed since Since Superstorm Sandy flooded over 30,00040,000 owner-occupied homes, Dream Homes has helped hundreds of homeowners to rebuildbuild new homes or raise their homes to comply with new FEMA requirements. While other builders have struggled to adapt to the changing market and complex Federal, State and local regulations involved with coastal construction in Flood Hazard Areas, Dream Homes has excelled. As many of our competitors have failed, Dream Homes has developed a reputation as the region’s most trusted builder and has even become known as the “rescue”“rescue builders have struggled to adapt to the changing market and complex Federal, State and local regulations” builder for homeowners whose projects have been abandoned by others. Due to the damage caused by the storm, as well as the material changes in the FEMA flood maps which now require over 30,00040,000 homeowners along the New Jersey coastline to elevate their homes, Dream Homes is positioned to capitalize on this opportunity for substantial revenue growth.

A new trend in the real estate market which has experienced significant growth in the last year is the emerging Build To Lease trend. This focus and concentration on building both single and multi-family developments with the intention to lease them immediately upon completion is being made in response to several factors. One factor is the extreme shortage of rental properties on the market, not only for first time homemakers, but for retirees, and young professionals who are unclear as to the intentions of settling in one location. The second factor is the overall lender and funding source preference to lend to Build To Lease developments, as opposed to more traditional Build To Sell developments due to the perception of Build To Lease as a safer investment over the long term. Finally, the extraordinary amount of interest from non-traditional sources such as pension and hedge funds, insurance companies and venture capital firms to purchase completed new For Lease developments at attractive metrics based on capitalization rates has spurred a large growth in this market segment.

The Company has made the decision to change focus in their new home developments to better accommodate this growing trend. Currently all new multi-family developments located in Ocean County, which represent a total count of 155 units, will be changed from Build For Sale to Build for Lease. The Company now intends to hold these properties upon completion and lease-up for an indeterminate period of time, and realize the rental income from ownership. This strategy will become a very significant revenue stream for the Company and will become a third division of the Company, behind custom new homes and renovation/elevation projects.

Management recognized that the effects of Super Storm Sandy, which occurred on 10/29/12, would be far reaching and cause an almost unlimited demand for construction services, as well as specific construction information. Due to the damage caused by the storm, as well as the material changes in the FEMA flood maps which now require over 30,00040,000 homeowners along the New Jersey coastline to elevate their homes, management feels that focusing on the construction field will continue to provide a stable revenue stream for the company.

Recognizing the growing preference for modular homes, in October of 2018, DHDC purchased the assets of Premier Modular Homes, which has operated successfully in southern Ocean County for over 25 years. The Company also opened a modular showroom and design center in Little Egg Harbor, which allows much stronger coverage of the Long Beach Island market.

In the first quarter of 2020, the Company signed a lease for an office in Brielle, NJ, which will better serve the Company’s growing Monmouth county market.

Dream Homes and Development Corporation through its subsidiaries and affiliate companies, continues to pursue opportunities in the real estate field, specifically in new home construction, home elevations and renovations. The amount of these projects currently under contract as of MarchDecember 31, 2021 is $5,490,929.$8,504,668.

In addition to the above projects, which are in process, the Company has also estimated an additional $6,500,000 worth of residential construction projects and added over 200 active prospects to its data base. All these prospects are prime candidates for educational videosrebuilding and short books on specific construction and rebuilding topics, as well as candidates for rebuildingnew home projects.

In addition to the projects which the Company currently has under contract for elevation, renovation, new construction and development, there are a number of parcels of land which the Company has the ability to secure, whether through land contract or other types of options. These parcels represent additional opportunities for development and construction potential.

Properties currently under contract to purchase and in the development stageCurrently Owned

Berkeley Terrace – Bayville, NJ – 70 approved townhome units

A contract was signed to acquire 70 approved townhome units in October 2019, after 31 months of discussion. Thisdiscussion, and the property iswas acquired in late June 2021. Site improvements are scheduled to closecommence in the spring of 2021, at which time site improvements will commence.summer 2023. Sales willor rental revenues are scheduled to accrete to 2021, 2022 & 2023 – 2024 income. The Company has secured a bridge loan and is awaiting a commitmentactively working with aseveral permanent lender forlenders to finalize an acquisition, development and construction finance facility. Funding for land only has been secured at this time. Closing for this

The Company is preparing to begin infrastructure work on the property, is scheduled for mid to late June 2021. Infrastructure and construction will occur shortly thereafter.start a prelease program.

Lacey Township, New Jersey, “Dream Homes at the Pines”, Contract

Dream Homes is in contract and under development for a parcel which will yield 68 new townhomes in the Ocean County NJ area, of which 54 are market rate and 14 are affordable housing. The acquisition of the contract was made for common stock and occurred in the 4th quarter of 2016. This property is currently in the approval process. This development project is scheduled to begin in 2021late 2022 and is projectedwill accrete to add approximately $17,000,000 to the Company’s gross2023 sales.

All costs associated with this property necessary to obtain all approvals, acquire the land, install the infrastructure and prepare the property to commence construction are the Company’s responsibility.

In order to obtain all developmental approvals and be prepared to begin installing infrastructure, various permits and engineering work are required. These permits include but are not limited to township subdivision, county, municipal utility authority, CAFRA (NJ Department of Environmental Protection) and NJ Department of Transportation. To date, design engineering has been completed, and a CAFRA application has been prepared and submitted, to the environmental scientist, along with a check for $36,750 payable toand the NJ DEP. Application for this permit was made in April 2017. As of this date, the CAFRA application has been put on hold pending a determination if the township will be approved by the State of New Jersey forDEP issued a CAFRA Town Center designation. A Lacey Township Planning Board meetingpermit in October of 2021. Preliminary township approval was held on December 11, 2017. Additional information was requested from the board and the next meeting is scheduled to be heard for preliminary and final approvalgranted on April 19^th of 2021. Preliminary and Tentative Municipal Utilities Authority approvals have been granted. Ocean County Planning Board approval has been granted. Lacey Township Fire Department approval has been granted.

It is anticipated that complete development approvals will cost approximately $50,000$20,000 more to complete. In addition to these approval costs and acquisition costs, infrastructure costs are anticipated to cost approximately $1,000,000. The total amount of funding required to acquire and make this property ready for home construction is approximately $1,900,000.

The Company may needis in active discussions with various lenders to seek loans from banks to financecomplete the infrastructure and vertical financing portions of this project. As part of their financing agreements, the banks typically require Vincent Simonelli to personally guarantee these loans. If Mr. Simonelli cannot qualify as a guarantor and there is no one other than him in the Corporation

The closing to provide those guarantees, the financing of the deal may be adversely affected. The exact amount of funding required foracquire this particular property is not clear at the present time but will be determined when full approvals have been obtainedoccurred on June 29, 2021 and the Company is prepared to take title to the property.currently in title.

As of February 26, 2021, financing has been secured to purchase the land upon municipal approvals being granted.

Dream Homes Apartments - Fairview

On May 3, 2018, the Company submitted a signed letter of intent to purchase 5.5 acres of property in Gloucester County, which is currently being approved for a 112-unit apartment complex, with 8000approximately 7600 square feet of retail space. The Company has a signed contract and has been proceeding with development approvals. The property is designated as a redevelopment property, and a redevelopment agreement is currently being negotiated with the township. Progress has been delayed due to township closures due to the Covid-19 pandemic.

On February 26, 2021, the Company took title to the property via an assemblage of 3 parcels.

The Company successfully obtained Redevelopment Approval from the Borough in July 2021 and Preliminary and Final Site Plan approval in December of 2021.

All outside agency approvals have been submitted for and are in process.

Louis Avenue – Bayville, NJ – Property being developedIn title

In October of 2018, the company entered into a contract to acquire and develop and acquireproperty for 17 townhouse lotsunits in Bayville NJ. Engineering and approvals are currently in process. Application was made to the Planning Board on March 20, 2020. The project was deemed complete by the township engineer and is awaiting a date for a planning board hearing.engineer. Municipal scheduling has beenwas delayed due to the Covid-19 virus. Thevirus, but the Company was heard before the Berkeley Township Planning Board on October 3, 2020. The planning board2020 and the Company was awarded preliminary approvals for 17 townhome units on October 3, 2020. units.

Application is currently being preparedmade for final approvals. Theapprovals, and the Company is scheduled to acquirebe heard at the May 2022 planning board meeting. Subsequent event: The Company received Final approval on May 19, 2022.

The Company acquired this property on August 4, 2021.

The Company intends to develop, lease and retain this property in July ofit’s portfolio for the foreseeable future.

The Company acquired this property on August 4, 2021.

Properties Under Contract to Purchase and in the Approval Stage

Autumn Run – Gloucester County

On December 7, 2018, the Company signed a contract to purchase a property in Gloucester County, NJ, which will be approved for +/- 63 units of age-restricted manufactured housing. The property is currently in the approval stage. An application was made to the DEP for a wetlands letter of interpretation, which was approved as proposed. Further action before the planning board is pending due to delays caused by township closures due to Covid-19. The Company had a virtual workshop meeting on September 15, 2020 and an additional virtual meeting was conducted on November 17, 2020. A planning board hearing

The application for a use variance is scheduled forwas heard on May 24, 2021.2021 and the variance was approved.

The Company is in the process of applying for preliminary and final site plan approval and should be heard at the October 2021 meeting.

Little Egg Harbor Township, New Jersey, “Dream Homes at Radio Road”, Contract

Contracts signed and in Due Diligence

On March 14, 2018, the

The Company has signed a contract to purchase 4 improved lots (1 lot has been sold)44 +/- acres in Little Egg Harbor Township, NJ (the “Dream Homes at Radio Road”)Gloucester county, which is suitable for a total of $260,000.age-restricted single family development. The Contract between the Company and the seller of the land providesprojected yield for a $65,000 per lot purchase price with closing occurring on a rolling basis, as each house is built and sold. The Company intends to begin construction as buyers are secured and the homes are projected to sell in the $350,000 - $375,000 range.

Properties on hold due to delay in approvals, environmental concerns or other reasons

Berkeley Township, New Jersey, “Dream Homes at Tallwoods”, Contract

On March 1, 2017, the Company acquired from DHL rights to a contract to purchase over 7 acres of land in Berkeley Township, NJ (the “Tallwoods Contract or Dream Homes at Tallwoods”) for 71,429 restricted shares of Company common stock (issued in April 2017).

Since the transaction had not occurred for at least a portion of the Property within 12 months of the completion of the Due Diligence Period, as well as two 6-month extensions, the seller chose to terminate the contract. Though the Company retained the right to waive any remaining development contingencies and proceed to close on the property it was determined by senior management that the risk of acquiring an unapproved property was not acceptable.varies between 100 – 160 units, and is subject to environmental, utility and township constraints.

Summary

These four new developments with signed letters of intent,that have recently been acquired as well as the four developmentsone that are under contract andis in development represent over $108$70 million in new home construction projects on the books in the next few years. This work will occur over the next 3-4 years and is in addition to the custom spot lot & elevation/renovation division of the business. Management is very positive about these new developments, as well as the cutting-edge construction technologies being employed to create healthier, safer, more energy efficient homes.

Dream Homes has experienced solid growth in both the new home and elevation divisions, as well as strong additions to our personnel infrastructure, which are just now beginning to bear fruit. Our new Modular HomeOffice and Showroom in Little Egg HarborBrielle has also led to an increase in modular traffic and sales, as well as facilitated and increased client selections throughout our entire northern region.

The Company was awarded the Ocean County Best of the Best Awards for 2017, 2018, 2019 & 2020 in two categories (Best Custom Modular Builder and Best Home Improvement Contractor), which has caused significant new awareness and interest from the public. This has led to more showroom traffic, completed estimates and signed contracts. Referrals about Dream Homes are also being generated from many industry professionals, such as architects, engineers and attorneys, who’ve either had clients with abandoned projects or simply want to retain Dream due to superior performance and reliability.

The phrase ‘The Region’s Most Trusted Builder’ accurately describes the company and is becoming increasingly well known to homeowners in need of new homes, elevation & renovation work. The management team has never failed to complete a project in over 28 years in the industry.

The Company’s business model over the last year has been focused on increasing the new home and new development portion of our business, until it represents 50% - 70% of our entire revenue stream, from the current level of 20%. New home development has a much greater scalability and growth potential than elevation/renovation work. Though the Company has enjoyed steady growth in the renovation/elevation portion of the company the new homes division continues to represent a greater percentage of total revenue. By the end of 2021, new home construction and development should represent over 70% of revenue.

Management hopes for steady growth in all segments of the company, since the rebuilding process will occur over the next 15-20 years. The combined total number of homes affected by Storm Sandy that will need to be raised or demolished and rebuilt is in excess of 30,000 homes, of which less than 10,000 have been rebuilt. This remaining combined market for new construction and elevation projects in the Company’s market area is estimated to be in the range of $3.4 billion dollars. The company anticipates being able to efficiently address 5% - 10% of this market. Dream Homes’ potential operations include the development and sale of a variety of residential communities, including construction of semi-custom homes, entry-level and first time move-up single-family and multi-family homes.

Due to the opportunities afforded by the market conditions, Dream Homes and Development Corporation will continue to pursue opportunities in the construction and real estate field, specifically in new home construction, home elevations and renovations.

RESULTS OF OPERATIONS – DREAM HOMES & DEVELOPMENT CORPORATION

The summary below should be referenced in connection with a review of the following discussion of our results of operations for the three months ended March 31, 20212022 and 2020.2021.

STATEMENTS OF OPERATIONS

For the three months ended March 31, 2021 and 2020

(Unaudited)

Results of Operations - Comparison for the three months ended March 31, 20212022 and 2020.2021.

RevenuesSTATEMENTS OF OPERATIONS

For the three months ended March 31, 20212022 and 2020, revenues were $679,147 and $1,127,584, respectively. The decrease in revenue of $448,437, was due to weather conditions and contractor help.2021

(Unaudited)

Cost of SalesRevenues

For the three months ended March 31, 2022 and 2021, revenues were $995,205 and 2020,$679,147, respectively.

The increase is due to commencing of new construction projects.

Cost of Sales

For the three months ended March 31, 2022 and 2021, cost of construction contracts were $584,866 and $514,490, and $932,194, respectively. This decrease of $ 417,704 was due mainly to decreased production.

Operating Expenses

Operating expenses decreased $38,323$55,907 from $310,252$273,6187 in 20202021 to $271,929$217,711 in 2021.2022. This decrease wasis mainly due to production decrease.the lack of stock-based compensation.

Liquidity and Capital Resources

As of March 31, 20212022 and December 31, 2020,2021, our cash balance was $350,202$127,493 and $55,519,$191,439, respectively, total assets were $1,615,193$8,551,480 and $1,374,586,$8,130,754, respectively, and total current liabilities amounted to $1,115,375$7,901,520 and $860,672,$7,646,000, respectively, including loans payable to related parties of $3,671$280,395 and $3,671,$192,439, respectively. As of March 31, 20212022 and December 31, 2020,2021, the total stockholders’ equity was $499,818$649,960 and $504,914,$484,754, respectively. We may seek additional capital to fund potential costs associated with expansion and/or acquisitions.

Inflation

The impact of inflation on the costs of our company, and the ability to pass on cost increases to its subscribers over time is dependent upon market conditions. We are not aware of any inflationary pressures, thatthey have had anya significant impact on our operations, since inception, and we do not anticipate that inflationary factors will have a significant impact on future operations.

OFF-BALANCE SHEET ARRANGEMENTS

We do not maintain off-balance sheet arrangements nor do we participate in non-exchange traded contracts requiring fair value accounting treatment.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

The Company has adopted and maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the reports filed under the Exchange Act, such as this Form 10-Q, is collected, recorded, processed, summarized and reported within the time periods specified in the rules of the Securities and Exchange Commission. The Company’s disclosure controls and procedures are also designed to ensure that such information is accumulated and communicated to management to allow timely decisions regarding required disclosure. As required under Exchange Act Rule 13a-15, the Company’s management, including the Principal Executive Officer and Principal Financial Officer, has conducted an evaluation of the effectiveness of disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, the Company’s President concluded that the Company’s disclosure controls and procedures are not effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s President, as appropriate, to allow timely decisions regarding required disclosure.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

None.No material legal proceedings at this time.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Mine Safety Disclosure

Not Applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

The following exhibits are included with this filing:

3.1* Articles of Incorporation (Form S-1 Registration No. 333-174674 filed June 2, 2011).

3.2* By-laws (Form S-1 Registration No. 333-174674 filed June 2, 2011).

4.1* Specimen Stock Certificate (Form S-1 Registration No. 333-174674 filed June 2, 2011).

10.1* Intellectual Property Purchase Agefreement (Form S-1 Registration No. 333-174674 filed June 2, 2011).

10.2* Consulting Agreement with William Kazmierczak 5-22-2010 (Form S-1 Registration No. 333-174674 filed June 2, 2011).

31 Sarbanes-Oxley Section 302 certification by Vincent Simonelli

32 Sarbanes-Oxley Section 906 certification by Vincent Simonelli

101.INS Inline XBRL Instance Document

101.SCH Inline XBRL Taxonomy Extension Schema Document

101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document

104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Previously filed and Incorporated by reference.

SIGNATURES

Pursuant to the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on behalf by the undersigned; duly authorized.