UNITED STATES
                 SECURITIES AND EXCHANGE COMMISSION
                       Washington, D.C. 20549

                              FORM 8-K

                          CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


  Date of Report (Date of earliest event reported) May 16, 2002


                       STRATUS PROPERTIES INC.
      (Exact name of registrant as specified in its charter)


        Delaware               0-19989              72-1211572
(State or other jurisdiction (Commission          (IRS Employer
      of incorporation)       File Number)      Identification No.)


    98 San Jacinto Boulevard, Suite 220
               Austin, Texas                          78701
  (Address of principal executive offices)          (Zip Code)



                            (512) 478-5788
        (Registrant's telephone number, including area code)



Item 5.   Other Events.

     On  May  16,  2002, Stratus entered into a  new  stockholder
rights plan to replace our previous stockholder rights plan  that
will  expire  on May 28, 2002.  The new plan, like  the  previous
plan,  is  designed  to  deter abusive takeover  tactics  and  to
encourage  prospective  acquirors to  negotiate  with  our  board
rather  than  attempt to acquire the company in a  manner  or  on
terms that our board deems unacceptable.

     Pursuant  to  the new rights plan, our board  of  directors
declared  a  dividend of one preferred stock purchase  right  for
each  outstanding  share of our common stock.   The  dividend  is
payable on May 29, 2002 to our stockholders of record on May  29,
2002.   If the rights become exercisable, each right will entitle
its  holder to purchase one one-hundredth (1/100) of a  share  of
our  Series  C  participating cumulative preferred  stock  at  an
exercise price of $40 per unit, subject to adjustment.

     The description and terms of the rights are set forth in the
Rights  Agreement, dated May 16, 2002, between us and our  rights
agent, Mellon Investor Services LLC, which is attached hereto  as
Exhibit  4.1.  The press release announcing the approval  of  the
new stockholder rights plan is attached hereto as Exhibit 99.1.

Item 7. Financial Statements and Exhibits.

     (c)  Exhibits.

        4.1   Rights   Agreement,  dated  as  of  May  16,  2002,
               between   Stratus  Properties  Inc.   and   Mellon
               Investor  Services  LLC, as  Rights  Agent,  which
               includes  as Exhibit A the Form of Certificate  of
               Designations of Series C Participating  Cumulative
               Preferred Stock; as Exhibit B the Forms of  Rights
               Certificate, Assignment, and Election to Purchase;
               and as Exhibit C the Summary of Rights to Purchase
               Preferred  Shares.  Incorporated by  reference  to
               Exhibit 4.1 to Stratus' Registration Statement  on
               Form 8-A dated May 22, 2002.

        99.1  Press Release of Stratus Properties Inc. dated  May
               21, 2002.




                           SIGNATURES

     Pursuant to the requirements of the Securities Exchange  Act
of  1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.


                              STRATUS PROPERTIES INC.



                              By:  C. Donald Whitmire, Jr.
                                 --------------------------
                                   C. Donald Whitmire, Jr.
                                  Vice President-Controller
                                 (authorized signatory and
                                 Principal Accounting Officer)

Dated:  May 23, 2002

                                             Exhibit 99.1

                    STRATUS PROPERTIES ADOPTS
                   NEW STOCKHOLDER RIGHTS PLAN

AUSTIN, TX, May 21, 2002 - Stratus Properties Inc. (NASDAQ:STRS)
announced today that its Board of Directors has adopted a new
stockholder rights plan (effective May 29, 2002) to replace the
existing stockholder rights plan, which expires May 28, 2002.

     Like the previous plan, the new stockholder rights plan is
designed to enable all Stratus stockholders to realize the full
value of their investment and to provide for fair and equal
treatment for stockholders in the event of an unsolicited attempt
to acquire Stratus.  The new plan does not prohibit the Board
from considering any offer that it considers advantageous to its
stockholders.  Stratus has no knowledge of any unsolicited
attempt to acquire Stratus.

     Under the new plan, one right will be distributed as a
dividend to stockholders of record on May 29, 2002 for each share
of Stratus common stock held.  Subject to certain conditions, the
rights will be exercisable if a person acquires or announces the
intent to acquire 20 percent or more of Stratus' common stock.

     If exercisable, each right would give the holder, other than
the acquirer, the ability to purchase an additional share of
Stratus common stock from the company at 50 percent of the market
price. The effect would be to discourage acquisition of 20
percent or more of Stratus' common stock without negotiating with
the Board of Directors.

     The new rights will expire on May 29, 2012, unless redeemed
or exchanged at an earlier date. The rights will initially trade
with shares of Stratus' common stock and will have no impact on
the way in which Stratus' shares are traded. There are currently
no separate certificates and there is no market for the rights.

     Stratus is a diversified real estate company engaged in the
development, marketing and management of real estate in the
Austin, Houston, and San Antonio, Texas areas.  A copy of this
press release and additional information about Stratus are
available on our web site stratusproperties.com.  Additional
information about our new rights plan also will soon be available
on our web site.