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YoY shift: Neutral
Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K. This filing is -0.06pp more bearish than last year's.
Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.
Tone shift by section
The two components the gauge averages: how Risk Factors and MD&A each shifted in net tone versus last year's 10-K. The headline above is their average, so a green needle over a soft section just means the other section carried it.
Risk Factors
-
Not scored
Net-tone change vs last year's 10-K.
MD&A
-0.06pp
Flat
Net-tone change vs last year's 10-K.
Per-snippet highlights
Sentence-level sentiment highlighting with category and subcategory filters is coming once the snippet-scoring pipeline lands. For now, dig into the actual section text on the Sections tab.
No section text extracted for this filing. The 10-K may use a non-standard template that the parser doesn't recognize - the original doc is still linked in the Stats tab.
Language change vs prior 10-K
MD&A (Item 7) - words with the biggest YoY frequency increase
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this Annual Report on Form 10-K. In addition to historical data, this discussion contains forward-looking statements about the Company’s business, operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. The Company’s actual results may differ materially from those in this discussion as a result of various factors, including, but not limited to, those discussed under Part, I. Item 1A— “Risk Factors” in this Annual Report on Form 10-K.
Overview
The Company is a Maryland corporation that has elected and qualified to be taxed as a REIT for U.S. federal income tax purposes beginning with the taxable year ending December 31, 2017. The Company is externally managed by the Advisor, a Delaware limited liability company and wholly owned subsidiary of the Company’s sponsor, CFI. The Company is a commercial real estate company formed to invest in and manage a diversified portfolio of income-producing commercial properties and multifamily properties, as well as other real estate-related assets.
The Company was incorporated in the State of Maryland on February 2, 2016 under the name Rodin Global Access Property Trust, Inc. On September 12, 2016, the Company changed its name to Rodin Global Property Trust, Inc. and on July 30, 2020, the Company changed its name to Cantor Fitzgerald Income Trust, Inc.
The Company plans to own substantially all of its assets and conduct its operations through the Operating Partnership. The Company is the sole general partner and limited partner of the Operating Partnership and the Special Unit Holder is the sole special unit holder of the Operating Partnership.
The Company is conducting a continuous public offering of shares of common stock pursuant to Rule 415 of the Securities Act. On March 23, 2017, the Company launched the Initial Offering of up to $1.25 billion in shares of common stock, consisting of up to $1.0 billion in shares in its Primary Offering and up to $250 million in shares pursuant to its DRP. On May 18, 2017, the Company satisfied the Minimum Offering Requirement for the Initial Offering as a result of CFI’s purchase of $2.0 million in Class IX shares. The Company terminated the Primary Offering effective July 31, 2020, but is continuing to offer up to $50.0 million of common stock pursuant to the DRP. On August 10, 2020, the Company launched the Follow-On Offering of up to $1.25 billion in shares of common stock, consisting of up to $1.0 billion in the primary offering and $250 million in shares pursuant to the DRP. On February 7, 2024, the Follow-On Offering terminated, and the Company launched the Third Offering of up to $1.25 billion in shares of common stock, consisting of up to $1.0 billion in the primary offering and $250 million in shares pursuant to the DRP. The Company intends to continue selling shares in the Third Offering on a monthly basis.
As of March 12, 2026, the Company had issued 3,048,010 Class AX shares, 4,933 Class TX shares, 1,007,510 Class IX shares, 1,268,751 Class T shares, 449,889 Class D shares, 5,445 Class S shares, and 5,577,263 Class I shares of common stock in its primary offering, as well as 609,139 Class AX shares, 127,979 Class TX shares, 174,636 Class IX shares, 93,502 Class T shares, 43,115 Class D shares, 439 Class S shares, and 442,173 Class I shares in the DRP for aggregate net proceeds of $297,622,470 in the Offerings.
Prior to the commencement of the Follow-On Offering, the Company determined its NAV as of the end of each quarter. NAV, as defined, is calculated consistent with the procedures set forth in the Company’s prospectus and excludes any O&O Costs, with such costs to be reflected in the Company’s NAV to the extent the Company reimburses the Advisor for these costs. Upon commencement of the Follow-On Offering, the Company started determining its NAV on a monthly basis, beginning with the determination of NAV as of July 31, 2020. As of December 31, 2025, the Company’s NAV was $20.10 per Class AX share, Class IX share, Class I share, and Class D share, $20.09 per Class TX share, Class T share and Class S share, $20.10 per Class I OP units, and $20.09 per Class T OP units. For further discussion of the Company’s NAV calculation, please see “—Net Asset Value”.
Currently, the Company intends to invest in a diversified portfolio of income-producing commercial real-estate, multifamily properties and debt secured by commercial real estate located primarily in the United States. The Company will seek to invest: (a) at least 80% of the Company’s assets in properties and real estate-related debt; and (b) up to 20% of the Company’s assets in real estate-related securities. The number and type of properties or real estate-related securities that the Company acquires will depend upon real estate market conditions, the amount of proceeds the Company raises in its offerings and other circumstances existing at the time the Company is acquiring such assets.
As of December 31, 2025, the Company had made the following investments:
the GR Property
the FM Property
the CO Property
the Lewisville Property
controlling interest in the Net Lease DST
majority interest in a joint venture that owns the SF Property
the Buchanan Property
interest in the Station DST
majority interest in the Keller DST
controlling interest in the Summerfield DST
the Madison Ave Property
controlling interest in the Valencia DST
the De Anza Property
controlling interest in the Kacey DST
controlling interest in the Industry DST
the Fisher Road Property
controlling interest in the Longmire DST
controlling interest in the ON3 DST
controlling interest in the West End DST
controlling interest in the Palms DST
the Mount Comfort Land
controlling interest in the Pearland DST
controlling interest in the WAG Portfolio DST
controlling interest in the WAG MH
an investment in a Data Center
The Company has no employees and has retained the Advisor to manage its affairs on a day-to-day basis. The Advisor’s responsibilities include, but are not limited to, providing real estate-related services, including services related to originating investments, negotiating financing, and providing property-level asset management services, property management services, leasing and construction oversight services and disposition services, as needed. The Advisor is a wholly owned subsidiary of CFI and therefore, the Advisor and CFI are related parties. The Advisor and its affiliates receive, as applicable, compensation, fees and expense reimbursements for services related to the investment and management of the Company’s assets. Such affiliated entities receive fees, expense reimbursements, and distributions (related to ownership of the Company’s common stock) as well as other compensation during the offering, acquisition, operational and liquidation stages.
The Company is not aware of any material trends or uncertainties, favorable or unfavorable, other than national economic conditions affecting real estate generally, that may be reasonably anticipated to have a material impact on either capital resources or the revenues or income to be derived from acquiring properties or real estate-related securities, other than those referred to in this Annual Report on Form 10-K.
Operating Highlights
2025 Activity
Raised 521,558 shares of common stock in the Offerings for gross proceeds of approximately $11 million. Repurchased 2,018,713 shares of common stock in the Offerings for gross proceeds of approximately $40 million.
On January 1, 2025, the Operating Partnership issued 865,711 Class I OP Units in exchange for a controlling interest of 100% in the WAG MH Property.
On December 20, 2024, a commitment of $10 million was made by the Operating Partnership to invest in Digital Bridge AI Infrastructure A, LP, a $500 million investment vehicle with commitments to four data center businesses across the U.S., Canada, and EMEA. As of December 31, 2025, $8,179,307 has been called for and funded to the investment in the Data Center.
On March 12, 2025, the WAG Portfolio Loan was repaid through the refinancing and the transfer of the debt to the Credit Facility. The new loan draw from the Credit Facility totaled $20,249,111 and is governed by the terms and conditions specified in the Credit Facility Agreement.
On July 18, 2025, the Company, through the Operating Partnership, acquired the remaining interest in the Longmire Property for $453,664. Additionally, on August 20, 2025 the Longmire Property was transferred into the Longmire DST as a part of the Longmire DST offering plan.
On July 16, 2025, the Company, through its Operating Partnership and subsidiary guarantors, amended and restated its Credit Facility Agreement with the Facility Lender. The Citizens Credit Facility was increased to $150 million, with the option to expand up to $250 million subject to lender commitments and conditions. Interest rates were updated to reflect either a term SOFR plus a margin of 2.20%–2.50%, or an alternative base rate plus a margin of 1.20%–1.50%, depending on the loan-to-value ratio. The amendment also revised the definitions of Change of Control and Permitted Properties. The new maturity date is July 16, 2028, with two one-year extension options available, contingent on compliance with financial covenants and payment of an extension fee.
In June, July and August 2025, the Operating Partnership issued Class I OP Units to third party investors in exchange for equity interest in the Net Lease DST.
On December 19, 2025, the Fisher Road Property executed a lease amendment. The lease amendment exercises a renewal option for an additional five-year term, extending the lease from 2027 through 2032. Base rent for the first year of the renewal term is an approximately 65% increase over the per square foot rent in the lease year ending in 2027. Rent during the renewal term escalates annually at 3.00%.
Portfolio Information
As of December 31, 2025, the Company owned interests in 43 real properties and a plot of land as described below:
Portfolio
Ownership
Percentage
Location
Number of
Properties
Square
Feet/ Acre
Remaining
Lease
Term (1)
Acquisition
Date
Purchase
Price (2)
Walgreens Grand Rapids ("GR Property")
Grand Rapids, MI
11.6 years
July 2017
CF Net Lease Portfolio IV DST ("Net Lease DST Properties")
Various
10.9 years
September 2017
Daimler Trucks North America Office Building ("FM Property")
Fort Mill, SC
3.0 years
February 2018
Alliance Data Systems Office Building ("CO Property")
Columbus, OH
6.7 years
July 2018
Hoya Optical Labs of America ("Lewisville Property")
Lewisville, TX
2.5 years
November 2018
Williams Sonoma Office Building ("SF Property")
San Francisco, CA
0.0 years (4)
September 2019
Martin Brower Industrial Buildings ("Buchanan Property")
Reflects number of years remaining until the tenant’s first termination option.
Reflects the contract purchase price at 100% ownership as opposed to adjusted for current ownership percentage as applicable.
Indicates individual tenant leases (with 1-year average lease term) for the multifamily residential properties.
The lease with William Sonoma expired on December 31, 2021. As of December 31, 2025, the SF Property is vacant.
As of December 31, 2025, lease expirations related to the Company’s net lease portfolio of real estate assets, (excluding the SF Property), based on each asset’s fair value used in determining the Company's NAV, were as follows:
After 2035 – 29.7%
As of December 31, 2025, the industry concentration of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was as follows:
Multifamily – 29.9%
Single Tenant Office – 26.1%
Single Tenant Industrial – 24.3%
Single Tenant Necessity Retail – 16.8%
Single Tenant Life Sciences – 1.4%
Data Center – 1.5%
As of December 31, 2025, the geographic concentration of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was as follows:
Ohio – 26.7%
Maryland – 20.8%
Texas – 15.1%
California – 12.6%
Wisconsin – 6.9%
South Carolina – 5.4%
Arizona – 5.0%
Other – 7.5%
As of December 31, 2025, the investment type concentration of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was as follows:
Common Equity – 100%
As of December 31, 2025, the maturity concentration of debt secured by the Company's portfolio of real estate assets (including the Company's credit facility, which makes up the majority of debt maturing in 2028, and has two one-year extension options), based on principal balances and adjusted for ownership percentage, was as follows:
After 2035 – 0.0%
As of December 31, 2025, the weighted average lease term remaining of the Company’s portfolio of real estate assets (excluding multifamily and data center investments), based on each asset’s fair value used in determining the Company's NAV, was 7.2 years.
As of December 31, 2025, the weighted average occupancy of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was 95.0%. For the Company's industrial, retail and office investments, occupancy includes all leased square footage as of the date indicated. For the Company's multifamily investments, occupancy is defined as the percentage of units occupied on the date indicated.
Related Party Transactions
The Company has entered into agreements with the Advisor, the Dealer Manager and CFI and its affiliates, whereby the Company pays certain fees and reimbursements to these entities during the various phases of the Company’s organization and operation. During the organization and offering stage, these include payments to the Dealer Manager for selling commissions, the dealer manager fee, distribution fees, and payments to the Advisor for reimbursement of organization and offering costs. During the acquisition and operational stages, these include payments for certain services related to the management and performance of the Company’s investments and operations provided to the Company by the Advisor and its affiliates pursuant to various agreements the Company has entered into with these entities. In addition, CFI has provided Sponsor Support in connection with the Initial Offering, which is subject to reimbursement under certain circumstances. See Note 10 — Related Party Transactions in the Notes to the consolidated financial statements contained elsewhere in this Annual Report on Form 10-K for additional information concerning the Company’s related party transactions and agreements.
Results of Operations
Rental Revenues
For the years ended December 31, 2025 and December 31, 2024, the Company earned rental revenues of $79,408,992 and $73,128,546, respectively.
The Company’s rental revenues consist primarily of rental income from triple net leased commercial properties and multifamily properties. The increase in rental revenues of $6,280,446 for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to the acquisition of rental income-producing property, the WAG MH Property, and an increase in rent from existing rental income-producing properties.
Preferred Return Income
For the year ended December 31, 2025, the Company did not earn preferred return income. For the year ended December 31, 2024, the Company earned preferred return income of $811,069.
The Company’s preferred return income consisted of preferred return accrued on the Company’s investment in preferred equity. The decrease in preferred return income of $811,069 for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was due to the disposition of the Company's preferred equity investment.
Income from mezzanine loan investment
For the year ended December 31, 2025, the Company did not earn income from mezzanine loan investment. For the year ended December 31, 2024, the Company earned income from mezzanine loan investment of $865,154.
The Company’s income from mezzanine loan investment consisted of interest income accrued on the Company’s mezzanine loan investment. The decrease in income from mezzanine loan investment of $865,154 for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was due to the disposition of the Company's mezzanine loan investment.
Other property operating revenues
For the years ended December 31, 2025 and December 31, 2024, the Company earned other property operating revenues of $18,446,272 and $20,732,821, respectively .
Other property operating revenues consists of amounts received by the Company from the tenants of its properties for utilities and other amenities and for reimbursable expenses paid by the Company on behalf of the tenants in accordance with the provisions of the respective property leases. The decrease in other property operating revenues of $2,286,549 for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to the period's decrease in revenues from the income producing properties.
General and Administrative Expenses
For the years ended December 31, 2025 and December 31, 2024, the Company incurred general and administrative expenses of $720,578 and $307,206, respectively.
The general and administrative expenses consist primarily of operating expense reimbursements to the Advisor, accounting fees and other professional fees. Pursuant to the terms of the Advisory Agreement, the Company is obligated to reimburse the Advisor for certain operating expenses. Beginning October 1, 2018, the Company was subject to the limitation that it generally may not reimburse the Advisor for any amounts by which the total operating expenses at the end of the four preceding fiscal quarters exceeds the greater of (i) 2% of average invested assets (as defined in the Advisory Agreement) and (ii) 25% of net income other than any additions to reserves for depreciation, bad debts or other similar non-cash reserves and excluding any gain from the sale of investments for that period (the “2%/25% Guidelines”).
The increase in general and administrative expenses of $413,372 during the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to an increase in both the number of cash accounts and their average balances, resulting in higher service charges and maintenance fees during such periods. As of December 31, 2025, the Advisor has incurred, on behalf of the Company, a total of $21,321,804 in Unreimbursed Operating Expenses, including a total of $3,404,797 during the year ended December 31, 2025 for which the Advisor has not invoiced the Company for reimbursement.
Depreciation and Amortization
For the years ended December 31, 2025 and December 31, 2024, the Company incurred depreciation and amortization of $35,844,677 and $34,456,767, respectively.
The increase in depreciation and amortization expenses of $1,387,910 for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to the acquisition of the WAG Portfolio Property and WAG MH Property.
Management Fees
For the years ended December 31, 2025 and December 31, 2024, the Company incurred management fees of $6,035,627 and $6,083,506, respectively.
Pursuant to the terms of the Advisory Agreement, the Company is required to pay the Advisor a monthly asset management fee, and may pay a monthly property management fee to the Advisor or an affiliate of the Advisor, if the Advisor or such affiliate serves as a property manager with respect to a particular property. Additionally, the Company may be required to reimburse certain expenses incurred by the Advisor in providing such asset management services, subject to limitations set forth in the Advisory Agreement.
Asset management fees payable to the Advisor consist of monthly fees equal to one twelfth of 1.20% of the Company’s most recently disclosed NAV. Effective January 1, 2026, asset management fees payable to the Advisor were decreased to monthly fees in an amount equal to one twelfth of 0.75% of the Company’s most recently disclosed NAV.
The decrease in management fees of $47,879 for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was due to a decrease in net fundraising in combination with a decrease in net valuation of the Company's investment portfolio and certain properties waiving management fees.
Property Operating Expenses
For the years ended December 31, 2025 and December 31, 2024, the Company incurred property operating expenses of $36,551,026 and $37,964,357, respectively .
The property operating expenses consist of reimbursable expenses paid by the Company on behalf of its tenants in accordance with the provisions of the respective property leases and operating expenses incurred in maintaining and operating the multifamily properties. The decrease in property operating expenses of $1,413,331 for the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to refunds of certain operating expenses at the multifamily properties during such periods.
Income/(loss) from Investments in Real Estate-Related Assets
Income/(loss) from investments in real estate-related assets is incurred or earned on the Company’s investment in the Station DST. For the years ended December 31, 2025 and December 31, 2024, the Company incurred a loss from investments in real estate-related assets of $26,149 and earned income of $136,667, respectively.
The decrease in income from investments in real estate-related assets of $162,816 during the year ended December 31, 2025, as compared to the year ended December 31, 2024, was due to the Company’s share of incurred loss at Station DST.
Interest Income
For the years ended December 31, 2025 and December 31, 2024, the Company earned interest income of $918,664 and $1,080,927, respectively.
Interest income is composed of interest earned on interest bearing cash deposit accounts with banking institutions.
The decrease in interest income of $162,263 during the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to an decrease in the cash held by the Company in interest bearing deposit accounts.
Net gain from Investment in Debt Securities, at Fair Value
For the year ended December 31, 2025, the Company had no gain or loss from investment in debt securities. For the year ended December 31, 2024, the Company earned a net gain from investment in debt securities of $1,340,613.
The Company's net gain from investment in debt securities consisted of interest income, unrealized loss, and realized gain on the Company's investment in CMBS. The decrease in net gain from investment in debt securities of $1,340,613, during the year ended December 31, 2025, as compared to the year ended December 31, 2024, was primarily due to the sale of the Company's investment in CMBS.
Unrealized gain from Investment in Infrastructure Fund, at Fair Value
For the year ended December 31, 2025, the Company had an unrealized gain of $472,565 from investment in infrastructure fund. For the year ended December 31, 2024, the Company had no gain or loss from investment in infrastructure fund.
The Company's unrealized gain from investment in infrastructure fund consists of changes in the fair value of the Company's investment in the Data Center. The increase in unrealized gain from investment in infrastructure fund of $472,565, during the year ended December 31, 2025, respectively, as compared to the year ended December 31, 2024, was primarily due to the Company's investment in the Data Center.
Loss from Sale of Investments in Real Estate-Related Assets
For the year ended December 31, 2025, the Company had no loss from sale of investments in real estate-related assets. For the year ended December 31, 2024, the Company incurred a loss from sale of investments in real estate-related assets of $3,385,131 which was due to the dispositions of the Company's investment in preferred equity and mezzanine loan.
Loss on Extinguishment of Debt
For the year ended December 31, 2025, the Company incurred a loss on extinguishment of debt of $333,574. For the year end December 31, 2024, the Company incurred a loss on extinguishment of debt of $619,284.
The loss on extinguishment of debt consists of unamortized debt issuance costs, prepayment fees, and miscellaneous fees paid to the original lender. The decrease in loss on extinguishment of debt of $285,710, during the year ended December 31, 2025, respectively, as compared to the year ended December 31, 2024, was due to the debt refinance on the Keller Property and the WAG Portfolio Property.
Impairment of Investment in Real Estate
For the year ended December 31, 2025, the Company incurred impairment of investment in real estate of $4,825,736. For the year ended December 31, 2024, the Company did not incur any impairment of investment in real estate.
The impairment of investment in real estate reflects the write down of the SF Property to its current net realizable value. Subsequent to December 31, 2025, the SF Property was sold.
Other Income
For the years ended December 31, 2025 and December 31, 2024, the Company earned other income of $331,117 and $226,516, respectively.
The Company's increase in other income was primarily due to the acquisition of the WAG MH Property and various refunds across other properties.
Interest Expense
For the year ended December 31, 2025 and December 31, 2024, the Company incurred interest expense of $28,767,002 and $27,253,061, respectively.
Interest expense is composed of interest paid and accrued on the Company’s outstanding loans payable, and also includes amortization of deferred financing costs and gains from the interest rate cap.
The increase in interest expense of $1,513,941 during the year ended December 31, 2025, as compared to the year ended December 31, 2024, was due to the increase of the advances on the Credit Facility and increase in SOFR rate, as well as the increased debt associated with the refinance of the WAG MH Property, netted against the gains from the interest rate cap.
Funds from Operations and Modified Funds from Operations
The Company defines MFFO in accordance with the definition established by the Institute for Portfolio Alternatives (the "IPA"). The Company’s computation of MFFO may not be comparable to other REITs that do not calculate MFFO using the current IPA definition. MFFO is calculated using FFO. The Company computes FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts, or NAREIT, as net income or loss (computed in accordance with accounting principles generally accepted in the United States, or U.S. GAAP), excluding gains or losses from sales of depreciable properties, the cumulative effect of changes in accounting principles, real estate-related depreciation and amortization, impairment charges on depreciable property owned directly or indirectly and after adjustments for unconsolidated/uncombined partnerships and joint ventures. FFO, as defined by NAREIT, is a computation made by analysts and investors to measure a real estate company’s cash flow generated by operations. The Company’s computation of FFO may not be comparable to other REITs that do not calculate FFO in accordance with the current NAREIT definition. MFFO excludes from FFO the following items, as applicable:
acquisition fees and expenses;
straight-line rent and amortization of above or below intangible lease assets and liabilities;
amortization of discounts, premiums and fees on debt investments;
non-recurring impairment of real estate-related investments;
realized gains (losses) from the early extinguishment of debt;
realized gains (losses) on the extinguishment or sales of hedges, foreign exchange, securities and other derivative holdings except where the trading of such instruments is a fundamental attribute of the Company’s business;
unrealized gains (losses) from fair value adjustments on real estate securities, including CMBS and other securities, interest rate swaps and other derivatives not deemed hedges and foreign exchange holdings;
unrealized gains (losses) from the consolidation from, or deconsolidation to, equity accounting;
adjustments related to contingent purchase price obligations; and
adjustments for consolidated and unconsolidated partnerships and joint ventures calculated to reflect MFFO on the same basis as above.
FFO and MFFO should not be considered as an alternative to net income (determined in accordance with U.S. GAAP) as an indication of performance. In addition, FFO and MFFO do not represent cash generated from operating activities determined in accordance with U.S. GAAP and are not a measure of liquidity. FFO and MFFO should be considered in conjunction with reported net income and cash flows from operations computed in accordance with U.S. GAAP, as presented in the financial statements.
The following table presents a reconciliation of FFO to net income (loss):
Year ended
December 31, 2025
Net income (loss)
Net income (loss) attributable to non-controlling interest
Net income (loss) attributable to common stockholders
Adjustments:
Real estate depreciation and amortization
Impairment of investment in real estate
Proportionate share of adjustments from non-controlling interests
Funds from Operations
The following table presents a reconciliation of FFO to MFFO:
Year ended
December 31, 2025
Funds from Operations
Adjustments:
Amortization of above-market lease intangibles
Amortization of below-market lease intangibles
Straight-line rent
Fair value adjustments on derivatives not deemed hedges
Fair value adjustments on infrastructure fund investment
Loss on extinguishment of debt
Proportionate share of adjustments from non-controlling interests
Modified Funds from Operations
Net Asset Value
On January 16, 2026, the Advisor approved an estimated NAV as of December 31, 2025 of $20.10 for Class AX, Class IX, Class I shares, and Class D shares, $20.09 for Class TX, Class T and Class S shares, $20.10 for Class I OP units, and $20.09 for Class T OP units. The calculation of the Company’s estimated NAV was performed by Robert A. Stanger & Co., Inc. (“Stanger”), its independent valuation firm, in accordance with the procedures described in the “Net Asset Value Calculation and Valuation Procedures” section of the Company’s prospectus and under the oversight of the Company’s board of directors. Although the independent valuation firm performs the calculation of the Company’s estimated NAV, the Company’s board of directors is solely responsible for the determination of the Company’s estimated NAV.
Estimated NAV
The determination of NAV involves a number of assumptions and judgments, including estimates of the Advisor’s interest in disposition proceeds (if any). These assumptions and judgments may prove to be inaccurate. There can be no assurance that a stockholder would realize the mostly recently determined NAV per share if the Company were to liquidate or engage in another type of liquidity event today. In particular, the Company’s December 31, 2025 NAV is based on appraisals of the fair market value of certain of the Company’s real estate property investments which precede December 31, 2025 and, while the Company believes no material change has occurred in the value of these real estate property investments between the appraised value dates and December 31, 2025, Stanger has assumed no material change in property value has occurred since the appraisal date for those Appraised Properties with an appraised value date that preceded December 31, 2025. Furthermore, the Company’s December 31, 2025 NAV does not consider fees or expenses that may be incurred in providing a liquidity event, including reimbursement of amounts to the Advisor for O&O Costs and any operating expenses that have not been invoiced by the Advisor in accordance with the terms of the Advisory Agreement. The Company believes the methodology of determining the Company’s NAV conforms to the Institute for Portfolio Alternative’s Practice Guideline for Valuations of Publicly Registered Non-Listed REITs (April 2013) and is prepared in accordance with the procedure described in the “Net Asset Value Calculation and Valuation Procedures” section of the Company’s prospectus. In addition, the Company’s board of directors periodically reviews the Company’s NAV policies and procedures.
The NAV for each class of shares is based on the value of the Company’s assets and the deduction of any liabilities, and any distribution fees applicable to such class of shares.
The following table provides a breakdown of the major components of the Company’s NAV pursuant to the Company’s valuation guidelines:
Components of NAV
December 31, 2025
Investment in real estate
Investments in real estate-related assets
Investment in infrastructure fund, at fair value
Cash and cash equivalents and restricted cash
Other assets
Debt obligations (at Fair Market Value)
Due to related parties (1)
Accounts payable and other liabilities
Accrued performance participation allocation
Distribution fee payable the following month (2)
Non-controlling interests in subsidiaries
Sponsor Support repayment / special unit holder interest in
liquidation
Net Asset Value
Number of outstanding shares and OP units (3)
Note: (1) Excluding the full distribution fee liability of $25,326. Distribution fee only relates to Class TX, Class T, Class D and Class S shares of common stock and Class T OP units.
(2) The distribution fee that is payable as of December 31, 2025 related to Class TX, Class T, Class D, Class S shares, and Class T OP units is shown in the table below.
(3) Includes Class AX, Class TX, Class IX, Class T, Class I, Class S shares of common stock, and Class I OP and Class T OP units issued in connection with the exercise of fair market value option of the WAG Portfolio Property, Summerfield Property, WAG MH Property, and Net Lease DST Property.
Due to rounding, numbers presented throughout this section may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.
NAV Per Share
Class AX, IX & I Shares
Class TX Shares
Class T Shares
Class D Shares
Class S Shares
Class I OP Units
Class T OP Units
Total
Total gross assets at Fair Value
Distribution fees due and payable
Debt obligations (at Fair Market Value)
Due to related parties
Accounts payable and other liabilities
Accrued performance participation allocation
Non-controlling interests in subsidiaries
Quarterly NAV
Number of outstanding shares/units
NAV per share/unit
The following table reconciles stockholders’ equity per the Company’s consolidated balance sheet to the Company’s NAV:
Reconciliation of Stockholders’ Equity to NAV
December 31, 2025
Stockholders’ equity under U.S. GAAP
Adjustments:
Unrealized depreciation of real estate
Unrealized appreciation of real estate-related assets
Acquisition costs
Deferred financing costs, net
Accrued distribution fee (1)
Accumulated depreciation and amortization
Fair value adjustment of debt obligations
Deferred rent receivable
Derivative assets, at fair value
Non-controlling interests in subsidiaries
NAV
Note: (1) Accrued distribution fee only relates to Class TX, Class T, Class D and Class S shares of common stock and Class T OP units.
The following details the adjustments to reconcile U.S. GAAP stockholders’ equity to the Company’s NAV:
Unrealized depreciation of real estate
The Company’s investments in real estate are presented at historical cost, including acquisition costs, in the Company’s U.S. GAAP consolidated financial statements. As such, any increases or decreases in the fair market value of the Company’s investments in real estate are not included in the Company’s U.S. GAAP results. For purposes of determining the Company’s NAV, the Company’s investments in real estate are presented at fair value.
Unrealized appreciation of real estate-related assets
The Company’s investments in real estate-related assets are presented at historical cost, including acquisition costs, in the Company’s U.S. GAAP consolidated financial statements. As such, any increases or decreases in the fair market value of the Company’s investments in real estate-related assets are not included in the Company’s U.S. GAAP results. For purposes of determining the Company’s NAV, the Company’s investments in real estate-related assets are presented at fair value.
Acquisition costs
The Company capitalizes acquisition costs incurred with the acquisition of its investments in real estate in accordance with U.S. GAAP. Such acquisition costs are not included in the value of real estate investments for purposes of determining NAV.
Deferred financing costs, net
Costs incurred in connection with obtaining financing are capitalized and amortized over the term of the related loan in accordance with U.S. GAAP. Such deferred financing costs are not included in the value of debt for purposes of determining NAV.
Accrued distribution fee
Accrued distribution fee represents the accrual for the full cost of the distribution fee for Class TX, Class T, Class D, Class S shares, and Class T OP units. Under U.S. GAAP, the Company accrues the full cost of the distribution fee as an offering cost at the time it sells the Class TX, Class T, Class D, Class S shares, and Class T OP units. For purposes of NAV, the Company recognizes the distribution fees as a reduction of NAV on a monthly basis as such fees are due.
Accumulated depreciation and amortization
The Company depreciates its investments in real estate and amortizes certain other assets and liabilities in accordance with U.S. GAAP. Such depreciation and amortization are not considered for purposes of determining NAV.
Fair value adjustment of debt obligations
The Company’s debt obligations are presented at historical cost in the Company’s U.S. GAAP consolidated financial statements. As such, any increases in the fair value of the Company’s debt obligations are not included in the Company’s U.S. GAAP results. For purposes of determining the Company’s NAV, the Company’s debt obligations are presented at fair value.
Deferred rent receivable
Deferred rent receivable represents rent earned in excess of rent received as a result of straight-lining rents over the term of the lease on certain of the Company’s properties. Such deferred rent receivable is not considered for purposes of determining NAV.
Derivative assets, at fair value
Derivative assets, at fair value represents a cash flow hedge which the Company uses to hedge interest rate risk related to the Valencia Loan. Such Derivative assets, at fair value are not considered for purposes of determining NAV.
Non-controlling interests in subsidiaries
Non-controlling interests in subsidiaries represents the equity ownership in a consolidated subsidiary which is not attributable to the Company. The interests are presented at fair value for purposes of determining the Company’s NAV.
The valuations of the Company's real properties as of December 31, 2025 were provided by Stanger or third-party appraisal firms in accordance with the Company's procedures. Certain key assumptions that were used by Stanger or third-party appraisal firms in the discounted cash flow analysis are set forth in the following table based on weighted-averages by property type at ownership interest.
December 31, 2025
Single Tenant Office
Single Tenant Industrial
Multifamily
Single Tenant Life Sciences
Weighted-Average Basis
Exit Capitalization Rate
Residual Discount Rate
Average Holding Period (Yrs)
A change in the exit capitalization and discount rates used would impact the calculation of the value of the Company's real property. For example, assuming all other factors remain constant, the changes listed below would result in the following effects on the value of the Company's real properties.
Hypothetical Change
Single Tenant Office
Single Tenant Industrial
Multifamily
Single Tenant Life Sciences
Weighted-Average Values
Exit Capitalization Rate
0.25% Increase
0.25% Decrease
Discount Rates
0.25% Increase
0.25% Decrease
Liquidity and Capital Resources
The Company is dependent upon the net proceeds from its public offerings to conduct its principal operations. The Company will obtain the capital required to purchase real estate and real estate-related investments and conduct its operations from the proceeds of the Offerings, any future offerings, from secured or unsecured financings from banks and other lenders and from any undistributed funds from its operations.
If the Company is unable to raise substantial funds in its public offerings, it will make fewer investments resulting in less diversification in terms of the type, number and size of investments it makes and the value of an investment in the Company will fluctuate with the performance of the limited assets it acquires. Further, the Company will have certain fixed operating expenses, including certain expenses as a public company and a REIT, regardless of whether it is able to raise substantial funds in the offerings. The Company’s inability to raise substantial funds would increase its fixed operating expenses as a percentage of gross income, reducing its net income and limiting its ability to make distributions. As of December 31, 2025, the Company has raised gross proceeds of $494,386,116 in the Offerings.
The Company uses debt financing as a source of capital. The Charter limits the Company from incurring debt if the Company’s borrowings exceed 300% of the cost of the Company’s net assets, which is estimated to approximate 75% of the cost of its tangible assets (before deducting depreciation or other non-cash reserves), though the Company may exceed this limit under certain circumstances. Once the Company has fully deployed the proceeds of the Offerings, the Company expects its debt financing and other liabilities may likely be approximately 60% of the cost of its tangible assets (before adjusting for depreciation or other non-cash reserves), although it may exceed this level during the offering stage.
As of December 31, 2025, the Company’s debt to tangible assets ratio was 56%. See Note 8 — Loans Payable of the Company’s outstanding debt arrangement as of December 31, 2025.
In addition to making investments in accordance with its investment objectives, the Company uses its capital resources to make certain payments to the Advisor and Dealer Manager. In conjunction with the Offerings, payments are made to the Dealer Manager for selling commissions, dealer manager fees, and distribution fee payments. With regards to the total organization and offering costs, including selling commissions, dealer manager fees, distribution fees and reimbursement of other organization and offering costs, will not exceed 15% of the gross proceeds of each Offering, including proceeds from sales of shares under the DRP. Additionally, the Company expects to make payments to the Advisor in connection with the management of its assets and costs incurred by the Advisor in providing services to the Company.
The Company anticipates that over time adequate cash will be generated from operations to fund its operating and administrative expenses, continuing debt service obligations and the payment of distributions. However, the Company’s ability to finance its operations is subject to some uncertainties. The Company’s ability to generate working capital is dependent on its ability to attract and retain tenants, investments that generate cash flow, and the economic and business environments of the various markets in which the Company’s properties will be located. The Company’s ability to sell its assets is partially dependent upon the state of real estate markets and the ability of purchasers to obtain financing at reasonable commercial rates.
Cash Flows
The following table provides a breakdown of the net change in the Company’s cash and cash equivalents and restricted cash:
Year ended
December 31, 2025
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Decrease in cash and cash equivalents and restricted cash
Operating Activities
During the year ended December 31, 2025, net cash provided by operating activities was $27,350,395, compared to $30,277,915 for the year ended December 31, 2024. The change was primarily driven by routine operational activity, including a reduction in cash outflows during the period and an increase in accounts payable and accrued expenses (see “—Results of Operations”).
Investing Activities
Cash used in investing activities was $10,919,071 for the year ended December 31, 2025, compared to $24,665,322 net cash provided by investing activities for the year ended December 31, 2024. The change was primarily due to a decrease of $10,399,997 in proceeds from sale of investment in debt securities, a decrease of $21,014,869 in proceeds from sale of investments in real estate-related assets, and an increase of $8,179,307 in purchase of interest in infrastructure fund.
Financing Activities
During the year ended December 31, 2025, net cash used in financing activities was $29,403,177, compared to $50,170,534 for the year ended December 31, 2024. The change was primarily driven by a net decrease of $19,041,222 related to borrowings and paydowns under credit facility and mortgage loans, a decrease in payments from redemptions of common stock of $19,240,978, and a decrease in syndicated ownership interest of $9,964,125.
Distributions
The Company’s board of directors has authorized, and the Company has declared, distributions for the period September 1, 2020 through November 30, 2025 in an amount equal to $0.004234973 per day (or approximately $1.55 on an annual basis) per each share of common stock and OP unit, less, for holders of certain classes of shares, the distribution fees that are payable with respect to such shares as further described in the applicable prospectus. Beginning December 2025, the Company transitioned from a fixed per-share distribution to an annualized distribution rate of 5.00% of NAV per share class. The distributions are payable by the 5th business day following each month end to stockholders of record at the close of business each day during the prior month.
The amount of distributions payable to the Company’s stockholders is determined by the board of directors and is dependent on a number of factors, including funds available for distribution, the Company’s financial condition, capital expenditure requirements, requirements of Maryland law and annual distribution requirements needed to qualify and maintain its status as a REIT. The Company’s board of directors may reduce the amount of distributions paid or suspend distribution payments at any time, and therefore distribution payments are not assured.
The following table summarizes the Company’s distributions declared during the years ended December 31, 2025 and December 31, 2024:
Year Ended December 31, 2025
Year Ended December 31, 2024
Amount
Percent
Amount
Percent
Distributions
Paid in cash
Payable
Reinvested in shares
Total distributions
Sources of Distributions:
Operating cash flows
Indebtedness
Offering proceeds
Total sources of distributions
During the year ended December 31, 2025, the Company declared $17,936,451 of distributions to its shareholders (including those reinvested in shares pursuant to the DRP), compared to the Company’s total aggregate MFFO of $8,399,010 and the Company’s total aggregate net loss of $8,412,310 for that period.
During the year ended December 31, 2024, the Company declared $21,082,652 of distributions to its shareholders (including those reinvested in shares pursuant to the DRP), compared to the Company’s total aggregate MFFO of $8,410,103 and the Company’s total aggregate net loss of $9,131,653 for that period.
During the year ended December 31, 2025, the Company generated $27,350,396 of cash flows from operations compared to the Company's declared distributions to its shareholders (including those reinvested in shares pursuant to the DRP) of $17,936,451 for that period.
During the year ended December 31, 2024, the Company generated $30,277,915 of cash flows from operations compared to the Company's declared distributions to its shareholders (including those reinvested in shares pursuant to the DRP) of $21,082,652 for that period.
Election as a REIT
The Company has elected and qualified to be taxed as a REIT under the Internal Revenue Code of 1986, as amended. The Company intends to operate in such a manner to qualify for taxation as a REIT, but no assurance can be given that the Company will operate in a manner so as to qualify or remain qualified as a REIT. In order to qualify and continue to qualify for taxation as a REIT, the Company generally must distribute annually at least 90% of the Company’s REIT taxable income. REITs are subject to a number of other organizational and operational requirements, including asset, income, share ownership, minimum distribution and other requirements. Even if the Company qualifies for taxation as a REIT, it may be subject to certain state and local taxes on its income and property, as well as federal income and excise taxes on its undistributed income.
Critical Accounting Estimates
Below is a discussion of the accounting policies that management believes are critical to the Company’s principal operations. The Company considers these policies critical because they involve significant judgments and assumptions, and they require estimates about matters that are inherently uncertain and they are important for understanding and evaluating the Company’s reported financial results. The accounting policies have been established to conform with U.S. GAAP. The preparation of the financial statements in accordance with U.S. GAAP requires management to use judgments in the application of such policies. Management bases its estimates on historical experience and on various other assumptions it believes to be reasonable under the circumstances, the results of which form the basis for making judgments. These judgments affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in the Company’s financial statements. Additionally, other companies may utilize different estimates that may impact the comparability of the Company’s results of operations to those of companies in similar businesses.
Reimbursement of Organization and Offering Costs
The Advisor has agreed to pay, on behalf of the Company, all O&O Costs through the first anniversary of the date on which the Company satisfied the Minimum Offering Requirement, which was May 18, 2018 (“Escrow Break Anniversary”). The Company was not required to reimburse the Advisor for payment of the O&O Costs prior to the Escrow Break Anniversary. After the Escrow Break Anniversary, the Advisor, in its sole discretion, may pay some or all of the additional O&O Costs incurred, but is not required to do so. To the extent the Advisor pays such additional O&O Costs, the Company is obligated to reimburse the Advisor subject to the 1% Cap. Following the Escrow Break Anniversary, the Company began reimbursing the Advisor for payment of the O&O Costs on a monthly basis, provided, however, that the Company will not be obligated to pay any amounts that as a result of such payment would cause the aggregate payments for O&O Costs (less selling commissions, dealer manager fees and distribution fees) paid to the Advisor to exceed the 1% Cap as of such payment date. Any amounts not reimbursed in any period are included in determining any reimbursement for a subsequent period. As of December 31, 2025, the Advisor has continued to pay all O&O Costs on behalf of the Company.
Variable Interest Entities
A Variable Interest Entity (“VIE”) is an entity that lacks one or more of the characteristics of a voting interest entity. For an entity in which the Company has acquired an interest, the entity will be considered a VIE if both of the following characteristics are not met: 1) the equity investors in the entity have the characteristics of a controlling financial interest, and 2) the equity investors’ total investment at risk is sufficient to finance the entity’s activities without additional subordinated financial support. The Company makes judgments regarding the sufficiency of the equity at risk based first on a qualitative analysis, then a quantitative analysis, if necessary. A qualitative analysis is generally based on a review of the design of the entity, including its control structure and decision-making abilities, and also its financial structure. In a quantitative analysis, the Company would incorporate various estimates, including estimated future cash flows, assumed hold periods and capitalization or discount rates.
If an entity is determined to be a VIE, the Company then determines whether to consolidate the entity as the primary beneficiary. The primary beneficiary has both (i) the power to direct the activities that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the entity.
The Company evaluates all of its investments in real estate-related assets to determine if they are VIEs utilizing judgments and estimates that are inherently subjective. If different judgments or estimates were used for these evaluations, it could result in differing conclusions as to whether or not an entity is a VIE and whether or not to consolidate such entity. As of December 31, 2025, the Company concluded that it had investments in VIEs, and because the Company was deemed the primary beneficiary it consolidated such entities, as described in “Note 11—Variable Interest Entities” in its accompanying consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data.”
Voting Interest Entities
A voting interest entity is an entity in which the total equity investment at risk is sufficient to enable it to finance its activities independently and the equity holders have the power to direct the activities of the entity that most significantly impact its economic performance, the obligation to absorb the losses of the entity and the right to receive the residual returns of the entity. The usual condition for a controlling financial interest in a voting interest entity is ownership of a majority voting interest. If the Company has a majority voting interest in a voting interest entity, the entity is generally consolidated. The Company does not consolidate a voting interest entity if there are substantive participating rights by other parties and/or kick-out rights by a single party. The Company performs on-going reassessments of whether entities previously evaluated under the voting interest framework have become VIEs, based on certain events, and therefore subject to the VIE consolidation guidance, and vice versa.
Current Expected Credit Losses (“CECL”)
The Company presents its financial assets that are measured at amortized cost net of an allowance for credit losses, which represents the amount expected to be collected over their estimated life. Expected credit losses for newly recognized financial assets carried at amortized cost, as well as changes to expected lifetime credit losses during the period, are recognized in earnings. The CECL methodology, which became effective for the Company on January 1, 2023, represents a significant change from prior U.S. GAAP and replaced the prior multiple impairment methods, which generally required that a loss be incurred before it was recognized. Within the life cycle of a loan or other financial asset in scope, the methodology generally results in the earlier recognition of the provision for credit losses and the related allowance for credit losses than under prior U.S. GAAP. The CECL methodology’s impact on expected
credit losses, among other things, reflects the Company’s view of the current state of the economy, forecasted macroeconomic conditions and the Company’s portfolios.
Accounting for Investments
Operating Real Estate
Operating real estate is carried at historical cost less accumulated depreciation. The Company follows the purchase method for an acquisition of operating real estate, where the purchase price is allocated to tangible assets such as land, building, tenant and land improvements and other identified intangibles. Major replacements and betterments which improve or extend the life of the asset are capitalized and depreciated over their useful life. Ordinary repairs and maintenance are expensed as incurred. Operating real estate is depreciated using the straight-line method over the estimated useful lives of the assets.
Revenue Recognition
Operating Real Estate
Rental and other income from operating real estate is derived from leasing of space to various types of tenants. The leases are for fixed terms of varying length and generally provide for annual rentals and expense reimbursements to be paid in monthly installments. Rental income from leases is recognized on a straight-line basis over the term of the respective leases.
Debt Investments
Interest income is recognized on an accrual basis along with any changes in the fair value. The changes in fair value are reflected as an adjustment to net gain from investment in debt securities in earnings.
Income Taxes
The Company has elected and qualified to be taxed as a REIT under the Internal Revenue Code of 1986, as amended. As a REIT, the Company generally will not be subject to U.S. federal income tax with respect to the Company’s income that is distributed annually to stockholders. The Company intends to operate in a manner that allows it to meet the requirements for taxation as a REIT. Many of these requirements, however, are highly technical and complex. The Company will monitor the business and transactions that may potentially impact the Company’s REIT status. If the Company were to fail to meet these requirements, it could be subject to U.S. federal income tax on the Company’s taxable income at regular corporate rates. The Company would not be able to deduct distributions paid to stockholders in any year in which it fails to qualify as a REIT. The Company would also be disqualified for the four taxable years following the year during which qualification was lost unless the Company was entitled to relief under specific statutory provisions.
The Company provides for uncertain tax positions based upon management’s assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. Management is required to determine whether a tax position is more likely than not to be sustained upon examination by tax authorities, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Because assumptions are used in determining whether a tax benefit is more likely than not to be sustained upon examination by tax authorities, actual results may differ from the Company’s estimates under different assumptions or conditions. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in “Provision for income taxes” in the consolidated statement of operations.
See Note 2 – Summary of Significant Accounting Policies in the accompanying consolidated financial statements included in Part II, Item 8 “Financial Statements and Supplementary Data” for further information on other accounting policies.
Recent Accounting Pronouncements
See Note 2 – Summary of Significant Accounting Policies in the accompanying consolidated financial statements included in Part II, Item 8. “Financial Statements and Supplementary Data.”
Inflation
Some of the Company’s leases with tenants may contain provisions designed to mitigate the adverse impact of inflation. These provisions generally increase rental rates during the term of the leases either at fixed rates or indexed escalations (based on the Consumer Price Index or other measures). The Company may be adversely impacted by inflation on the leases that do not contain indexed escalation provisions. However, the Company’s net leases will generally require the tenant to pay its allocable share of operating expenses, which may include common area maintenance costs, real estate taxes and insurance. This may reduce the Company’s exposure to increases in costs and operating expenses resulting from inflation.
Contractual Obligations
The following table presents the future principal payment due under the Company’s FM Loan, CO Loan, DST Loan, Buchanan Loan, Keller Loan, Valencia Loan, Kacey Loan, Industry Loan, ON3 Loan, West End Loan, Palms Loan, Pearland Loan, WAG MH Loan, and Credit Facility agreements as of December 31, 2025, which represents the Company’s aggregate contractual obligations and commitments with payments due subsequent to December 31, 2025.
Year
Amount
Thereafter
Total
Item 7A. Quantitative and Qualitat ive Disclosures About Market Risk.
Market Risk
The market risk associated with financial instruments and derivative financial instruments is the risk of loss from adverse changes in market prices or interest rates. The Company’s interest rate risk management objectives are to limit the impact of interest rate changes in earnings and cash flows and to manage overall borrowing costs. To achieve these objectives, from time to time, the Company may enter into interest rate hedge contracts such as swaps, collars and treasury lock agreements in order to mitigate interest rate risk with respect to various debt instruments. The Company would not hold or issue these derivative contracts for trading or speculative purposes. As of December 31, 2025, there are no such hedging contracts outstanding. The Company does not have any foreign operations and thus is not exposed to foreign currency fluctuations.
Interest Rate Risk
As of December 31, 2025, the Company had $444 million fixed rate debt and $156 million of floating rate debt. The Company uses derivative financial instruments to limit the exposure to interest rate changes associated with its borrowings. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with high credit ratings and with major financial institutions with which the Company and its related parties may also have other financial relationships. The Company does not anticipate that any of the counterparties will fail to meet their obligations. (For further detail refer to Note 8 – Loans Payable).
Credit Risk
Concentrations of credit risk arise when a number of tenants are engaged in similar business activities, or activities in the same geographic region, or have similar economic features that would cause their ability to meet contractual obligations, including those to the Company, to be similarly affected by changes in economic conditions. The Company is subject to tenant, geographic and industry concentrations. Any downturn of the economic conditions in one or more of these tenants, states or industries could result in a material reduction the Company’s cash flows or material losses to the Company.
As of December 31, 2025, lease expirations related to the Company’s net lease portfolio of real estate assets (excluding the SF Property), based on each asset’s fair value used in determining the Company's NAV, were as follows:
After 2035 – 29.7%
As of December 31, 2025, the industry concentration of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was as follows:
Multifamily – 29.9%
Single Tenant Office – 26.1%
Single Tenant Industrial – 24.3%
Single Tenant Necessity Retail – 16.8%
Single Tenant Life Sciences – 1.4%
Data Center – 1.5%
As of December 31, 2025, the geographic concentration of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was as follows:
Ohio – 26.7%
Maryland – 20.8%
Texas – 15.1%
California – 12.6%
Wisconsin– 6.9%
South Carolina – 5.4%
Arizona – 5.0%
Other – 7.5%
As of December 31, 2025, the investment type concentration of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was as follows:
Common Equity – 100%
As of December 31, 2025, the maturity concentration of debt secured by the Company's portfolio of real estate assets (including the Company's credit facility, which makes up the majority of debt maturing in 2028, and has two one-year extension options), based on principal balances and adjusted for ownership percentage, was as follows:
After 2035 – 0.0%
As of December 31, 2025, the weighted average lease term remaining of the Company’s portfolio of real estate assets (excluding multifamily and data center investments), based on each asset’s fair value used in determining the Company's NAV, was 7.2 years.
As of December 31, 2025, the weighted average occupancy of the Company’s portfolio of real estate assets, based on each asset’s fair value used in determining the Company's NAV, was 95.0%. For the Company's industrial, retail and office investments, occupancy includes all leased square footage as of the date indicated. For the Company's multifamily investments, occupancy is defined as the percentage of units occupied on the date indicated.
The factors considered in determining the credit risk of the Company’s tenants include, but are not limited to: payment history; credit status and change in status (credit ratings for public companies are used as a primary metric); change in tenant space needs (i.e., expansion/downsize); tenant financial performance; economic conditions in a specific geographic region; and industry specific credit considerations. The credit risk of the Company’s portfolio is reduced by the high quality of the Company’s existing tenant base, reviews of prospective tenants’ risk profiles prior to lease execution and consistent monitoring of the Company’s portfolio to identify potential problem tenants.
Item 8. Financial Statement s and Supplementary Data.
The financial statements required by this item and the reports of the independent accountants thereon required by Item 14(a)(2) appear on pages F-2 to F-43. See accompanying Index to the Consolidated Financial Statements on page F-1.
