Financial Performance - Full year 2024 net income attributable to common stockholders was $2.3 million, or $0.25 per diluted share[14] - Fourth quarter 2024 net income attributable to common stockholders was $0.6 million, or $0.07 per diluted share[14] - Full year 2024 AFFO was $14.99 million, or $1.34 per diluted share, exceeding street expectations by $0.08 per share[14] - Fourth quarter AFFO was $4.1 million, or $0.37 per diluted share, beating consensus estimates by 22%[14] - Total income for Q4 2024 was $11.730 million, compared to $12.388 million in Q4 2023, reflecting a decline of approximately 5.3% year-over-year[30] - Operating income for Q4 2024 increased to $5.330 million from $3.838 million in Q4 2023, representing a growth of approximately 38.9%[30] - The company reported a comprehensive income of $1.387 million for Q4 2024, compared to a comprehensive loss of $2.101 million in Q4 2023[34] - For the three months ended December 31, 2024, Modiv Industrial, Inc. reported a net income of $1,642,000, compared to a net loss of $1,048,000 for the previous quarter[36] - The earnings per share attributable to common stockholders for the latest quarter was $0.07, recovering from a loss of $0.18 in the prior quarter[36] - Funds from Operations (FFO) attributable to common stockholders and Class C OP Unit holders was $5,072,000 for the quarter ended December 31, 2024, up from $2,216,000 in the previous quarter[38] - Adjusted Funds from Operations (AFFO) attributable to common stockholders and Class C OP Unit holders was $4,067,000 for the latest quarter, compared to $3,702,000 in the prior quarter[38] - Modiv's AFFO per share on a fully diluted basis was $0.37 for the quarter ended December 31, 2024, compared to $0.34 in the previous quarter[38] - Annualized adjusted EBITDA for the year was $39,936,000, compared to $38,596,000 in the prior year[40] - Net income for the quarter was $1,642,000, a significant recovery from a net loss of $1,048,000 in the previous quarter[40] Asset Management and Acquisitions - The company plans to grow AFFO through acquiring positive income-producing assets and improving expense efficiency[20] - A small $2 million asset was sold, and a $6 million asset acquisition is expected to close by March 14, 2025[18] - The company has implemented a disciplined acquisition strategy, focusing on evaluating opportunities without overextending itself[17] - The total property acquisition activity from January 1, 2023, to December 31, 2024, includes 1,730,704 square feet with an initial lease price of $134.274 million[54] - The company disposed of properties totaling 405,025 square feet, generating $62.732 million in disposition price[57] - The company completed a non-core acquisition of a KIA auto dealership in Los Angeles County for $32.8 million, structured as an OP Unit transaction at a cost basis of $25.00 per share[63] - The company has a 12-year lease with OES for a legacy asset in Rancho Cordova, California, which includes a purchase option that OES may exercise until December 31, 2026[63] - A legacy property leased to Costco in Issaquah, Washington is under a purchase agreement with KB Home for $25.3 million, with a potential increase of $0.3 million for each additional townhome added before closing[63] Debt and Equity - Consolidated debt as of December 31, 2024, was $280,918,000, with a net debt to adjusted EBITDA ratio of 7.0x[40] - The leverage ratio as of December 31, 2024, was 48.0%, up from 47.6% in the previous quarter[44] - The company reported a total equity of $214,050,000, down from $225,122,000 in the previous year[47] - The weighted average interest rate for total debt outstanding was 4.27% as of December 31, 2024[46] - Total debt as of December 31, 2024, is $279.776 million, with a weighted average interest rate of 4.27%[48] - The company has a maximum leverage ratio of 47.6%, which is below the required limit of 60%[51] - The company reduced its Revolver line of credit from $150 million to $30 million, saving $0.3 million in annual unused fees[49] - New swap agreements were entered into for $250 million, fixing SOFR at 2.45% for the year ending December 31, 2025, resulting in a fixed rate of 4.25%[49] - The company has a minimum consolidated tangible net worth of $281.553 million, exceeding the required $221.737 million[51] Rental Income and Portfolio - Total rental income for Q4 2024 was $11.664 million, a decrease from $12.289 million in Q4 2023, attributed to the sale of 14 properties in August 2023 and two properties in Q1 2024[30] - The top 20 tenants contribute $35.439 million in annual base rent (ABR), representing 88% of the total portfolio[59] - Industrial core properties account for 78% of the total ABR, with 39 properties and 4,196,496 square feet[61] - California accounts for 30% of the total ABR, with 11,925 thousand dollars, while Ohio contributes 12% with 4,866 thousand dollars[65] - Lease expirations indicate that 5% of ABR, amounting to $1.812 million, is set to expire in 2025, with cumulative expirations reaching 100% by 2034[66] - The company holds 43 properties with an Annual Base Rent (ABR) of $39.638 million, representing 100% of the total portfolio[64] Impairment and Depreciation - The impairment charge for Q4 2023 was related to an office property in Nashville, Tennessee, which was sold in February 2024[32] - The impairment charge for the fourth quarter of 2023 was related to an office property in Nashville, Tennessee, which was sold on February 28, 2024[42] - The company experienced a depreciation and amortization of real estate properties totaling $4,163,000 for the quarter ended December 31, 2024[38] Definitions and Metrics - The company defines Funds from Operations (FFO) as net income excluding gains/losses from sales of depreciable property, plus real estate-related depreciation, providing a clearer view of operating performance[69] - Adjusted Funds from Operations (AFFO) excludes non-routine and certain non-cash items, offering insight into sustainable operating performance[70] - The leverage ratio is defined as total debt as a percentage of the aggregate fair value of real estate properties, including cash and cash equivalents[76] - The initial cap rate for property acquisitions is defined as the initial annual cash rent divided by the purchase price of the property[78]

Financial Performance - Funds from Operations (FFO) for the year ended December 31, 2024, was $16.802 million, compared to $10.175 million in 2023, reflecting an increase in operating performance [244]. - Adjusted Funds From Operations (AFFO) for 2024 was $14.988 million, slightly up from $14.673 million in 2023, indicating stable operating performance [244]. - Total rental income for the year ended December 31, 2024 was $46.5 million, a decrease of $0.4 million or 1% compared to $46.9 million in 2023, primarily due to the sale of properties [263]. - The company reported net cash provided by operating activities of $18.241 million in 2024, an increase from $16.579 million in 2023 [256]. - Interest income increased to $0.5 million in 2024 from $0.3 million in 2023, primarily due to higher interest rates on cash and proceeds from property sales [270]. - Dividend income decreased to $0.1 million in 2024 from $0.5 million in 2023, reflecting reduced dividends from GIPR preferred stock [271]. - Interest expense rose to $16.2 million in 2024 from $13.8 million in 2023, driven by increased interest rates and larger outstanding balances [273]. - The gain on sale of real estate investments was $3.4 million for the year ended December 31, 2024, compared to a loss of $1.7 million for 2023 [269]. Investment Strategy - The company’s primary investment objectives include providing attractive growth in Adjusted Funds from Operations (AFFO) and sustainable cash distributions [209]. - The company’s focus for future acquisitions is on critical industrial manufacturing properties with long-term leases to tenants [206]. - The company plans to acquire an industrial property for $6.1 million, with an initial cap rate of 8.00%, expected to close by March 14, 2025 [234]. - The percentage of Annual ABR from industrial core properties increased from 76% in 2023 to 78% in 2024, reflecting a strategic shift towards industrial manufacturing properties [247]. - In 2024, the company acquired one industrial manufacturing property and sold two non-core properties, resulting in 78% of the portfolio being industrial properties and 22% non-core properties as of December 31, 2024 [249]. Liquidity and Capital Structure - The company reported a leverage ratio of 47.6% as of December 31, 2024, with an aggregate of $250.0 million in new swap agreements fixing the Secured Overnight Financing Rate (SOFR) at 2.45% for the year ending December 31, 2025 [212][226]. - The company has $30.0 million of borrowing capacity available under its Credit Facility, which may be utilized for attractive investment opportunities [218]. - The company expects to maintain adequate liquidity to meet cash requirements for the next 12 months and beyond, funded by internally generated funds [219]. - The company’s Credit Facility includes a $280.0 million line of credit, with a $30.0 million revolving line of credit and a $250.0 million term loan [222]. - The company had $30.0 million in unused capacity on its Revolver as of the date of the Annual Report, which can be utilized for real estate investments and repositioning properties [230]. - The company is expected to incur $3.0 million in tenant improvements in 2025, funded from cash on hand and operating cash flow [238]. Property Management and Operations - The company successfully negotiated lease extensions for six properties during the years ended December 31, 2024, and 2023, despite potential future declines in rental rates and economic conditions [214]. - The company has two leases expiring on July 31, 2025, for properties leased to Costco and Solar Turbines, which may impact future cash flows [213]. - The weighted average lease term (WALT) for the company's properties was approximately 13.8 years as of December 31, 2024 [247]. - General and administrative expenses decreased by $0.3 million or 5% year-over-year, totaling $6.3 million in 2024 compared to $6.6 million in 2023 [264]. - Stock compensation expense significantly decreased by $9.6 million or 86% year-over-year, amounting to $1.6 million in 2024 compared to $11.2 million in 2023 [265]. - Depreciation and amortization expense increased by $1.0 million or 7% year-over-year, totaling $16.6 million in 2024 compared to $15.6 million in 2023 [266]. - Property expenses decreased by $1.5 million or 30% year-over-year, totaling $3.6 million in 2024 compared to $5.2 million in 2023 [267]. Portfolio Management - The company disposed of 14 non-core properties in 2023 for aggregate contract sales prices of $47.5 million, resulting in net proceeds of $44.4 million and a net loss on sales of $1.7 million [236]. - The company sold 14 properties in August 2023 and two properties in the first quarter of 2024, reflecting its ongoing portfolio transformation strategy [261]. - The total investments in real estate property as of December 31, 2024 were $393.488 million for industrial core properties and $108.200 million for non-core properties [252]. Market Conditions and Risks - The company anticipates potential impacts from inflation and interest rates, which may affect future operating results and liquidity [210][211]. - The company monitors real estate properties for impairment indicators, which may involve significant management judgment and assumptions [277]. - The company allocates purchase prices of acquired properties based on estimated fair values, impacting revenue and expense recognition timing [276]. - The company is classified as a smaller reporting company, thus not applicable for certain market risk disclosures [280].

Core Insights - The individual has a strong background in finance and investment, holding a bachelor's degree in Finance and Banking and a master's degree in Financial Management and Investment, which provides a solid academic foundation for investment analysis [1] - The investment strategy focuses on a contrarian approach, targeting unloved and undervalued assets while maintaining a long-term perspective [1] - The individual has achieved notable results in investing since starting at age 18 in 2018, emphasizing value investing principles and stable cash flow sectors such as consumer defensive, utilities, and real estate [1] Academic and Professional Credentials - The individual has earned certifications as a Capital Markets and Securities Analyst and a Financial Modeling & Valuation Analyst, showcasing specialized skills in evaluating complex financial instruments [1] - Successfully passed CFA Level 1 in May 2023 and CFA Level 2 in September 2024, with plans to take CFA Level 3 in August 2025, indicating a commitment to further expertise in investment analysis and portfolio management [1] Investment Philosophy - The investment philosophy is centered around identifying equities trading below their intrinsic value, with a focus on long-term appreciation and dividends [1] - There is a strong preference for sectors that provide stable cash flows, which aligns with the overall investment strategy [1] Engagement with the Investment Community - The motivation for contributing to Seeking Alpha is to enhance understanding of financial markets through company analysis and sharing insights with experienced investors [1]

Group 1 - Modiv Industrial's preferred stock (NYSE: MDV.PR.A) is largely overlooked by investors due to its low trading volume and the small market capitalization of the REIT, which stands at $167 million [3]

Core Viewpoint - Modiv Industrial, Inc. (MDV) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Rising earnings estimates for Modiv Industrial suggest an improvement in the company's underlying business, likely leading to increased stock prices [5][8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [7][9]. - Modiv Industrial's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10][11]. Recent Earnings Estimate Revisions - For the fiscal year ending December 2024, Modiv Industrial is expected to earn $1.32 per share, reflecting a -0.8% change from the previous year, but the Zacks Consensus Estimate has increased by 4.3% over the past three months [8].

Group 1 - Real estate investment trusts (REITs) exhibit a variety of strategies and structures, often presenting themselves as comprehensive investment solutions [1] - The author has over ten years of experience in the real estate sector, including roles in an S&P 500 REIT and a Big Four consulting firm, indicating a strong background in the industry [1] Group 2 - The article emphasizes the importance of diverse strategies within the REIT sector, suggesting that investors should consider a range of options when evaluating potential investments [1]

Financial Data and Key Metrics Changes - Rental income for Q3 2024 was $11.6 million, down from $12.5 million in the prior year, primarily due to the sale of 16 properties [7] - Adjusted funds from operations (AFFO) remained stable at $3.7 million, with AFFO per share increasing to $0.34 from $0.33 in the previous year [8][9] - Interest expense increased to $3.2 million compared to the same period in 2023, influenced by unrealized non-cash losses on swap valuations [10] - Total cash and cash equivalents were $6.8 million, with $280 million in debt outstanding, and no debt maturities until January 2027 [12] Business Line Data and Key Metrics Changes - The portfolio consists of 43 properties with an annualized base rent totaling $40.2 million as of September 30, 2024, and a weighted average lease term of 13.8 years [11] - Approximately 33% of tenants or their parent companies have an investment-grade rating of BBB- or better [11] Market Data and Key Metrics Changes - The company noted a challenging market for REITs, with most experiencing sell-offs, while Modiv Industrial's stock showed slight gains [6] Company Strategy and Development Direction - The company aims to focus on acquiring durable manufacturing assets while being disciplined about taking on additional debt [24] - Management is committed to increasing communication with retail investors, recognizing the low institutional ownership of less than 9% [21] - The company is actively evaluating the interest rate environment and plans to enter new swap agreements to maintain a fixed interest rate on its debt [13][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the acquisition pipeline, noting an increase in opportunities despite a previously dry summer [24] - The company is focused on maintaining a solid portfolio and is not rushing into decisions, emphasizing patience and discipline in a volatile market [15][16] - Management highlighted the importance of supporting American manufacturing and the potential for increased onshoring under the current political climate [42][44] Other Important Information - The Board of Directors declared a cash dividend of $0.0975 per common share for the first quarter of 2025, representing a 1.7% increase from the previous annualized dividend rate [14] - The company is preparing to formally market the Kalera property, which has been vacant since bankruptcy proceedings [36] Q&A Session Summary Question: How active is the pipeline today? - Management is encouraged by the current pipeline, noting that pricing for manufacturing assets is in the high-7s to low-8s range, with fewer buyers in the market [24] Question: Is the $6 million OP unit asset the entire purchase price? - Yes, the $6 million is the total purchase price with no additional cash element [27] Question: When is the right time to sell the Kia asset? - Management is considering the timing carefully, with a focus on a stable rate environment to maximize the asset's value [30] Question: What is the current tenant performance? - The Kalera property is currently vacant, and management is preparing to market it, while other tenants are performing well [36] Question: How does the election outcome affect acquisition strategies? - Management believes there will be continued support for American manufacturing, which aligns with their acquisition strategy [42][44] Question: What are the expectations for new hedges? - New hedges are expected to have similar or better terms than the expiring swaps, without cancellation features [50][53] Question: What is the company's approach to capital raising? - The company prefers to raise capital through retail investors rather than institutional investors, focusing on maintaining intrinsic value [66][70]

Group 1 - Modiv Industrial, Inc. reported quarterly funds from operations (FFO) of $0.34 per share, matching the Zacks Consensus Estimate and showing a year-over-year increase from $0.33 per share [1] - The company posted revenues of $11.59 million for the quarter ended September 2024, which was 2.61% below the Zacks Consensus Estimate and a decrease from $12.5 million a year ago [2] - Modiv Industrial's shares have increased approximately 12.9% since the beginning of the year, while the S&P 500 has gained 21.2% [3] Group 2 - The future performance of Modiv Industrial's stock will largely depend on management's commentary during the earnings call and the outlook for FFO [3][4] - The current consensus FFO estimate for the upcoming quarter is $0.35 on revenues of $11.9 million, and for the current fiscal year, it is $1.32 on revenues of $47.03 million [7] - The REIT and Equity Trust - Residential industry, to which Modiv Industrial belongs, is currently ranked in the top 40% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8]

Financial Performance - Third quarter AFFO was $0.34 per share, a penny higher than the same period last year and above consensus estimates[9]. - The company reported a net loss per share attributable to common stockholders of $(0.18) for the third quarter[18]. - The net loss attributable to common stockholders was $(1,508,277) for the quarter, compared to a profit of $403,042 in the same period last year[21]. - For the third quarter of 2024, Modiv Industrial, Inc. reported a net loss attributable to common stockholders of $1,694,965, compared to a profit of $281,002 in the previous quarter[36]. - The diluted loss per share for the third quarter of 2024 was $(0.18), a decrease from $0.03 in the previous quarter[36]. - The company experienced a net loss of $1,047,736 in the third quarter of 2024, compared to a net income of $1,261,736 in the second quarter of 2024[40]. - Funds from Operations (FFO) attributable to common stockholders and Class C OP Unit holders for the third quarter of 2024 was $2,215,511, down from $4,666,521 in the previous quarter[40]. - Adjusted Funds from Operations (AFFO) attributable to common stockholders and Class C OP Unit holders was $3,701,229 for the third quarter of 2024, compared to $3,900,228 in the previous quarter[40]. - The company reported a preferred stock dividend of $(921,875) for each of the last five quarters[40]. - The company reported a gain on the sale of real estate investments of $172,001 for the quarter, contrasting with a loss of $(1,708,801) in the same quarter of the previous year[20]. Revenue and Expenses - Rental income for the three months ended September 30, 2024, was $11,589,370, a decrease of 7.3% compared to $12,500,338 for the same period in 2023[20]. - Total income for the quarter was $11,655,363, reflecting a decline of 7.3% from $12,566,329 year-over-year[20]. - Total expenses increased to $6,927,563, up 44.5% from $15,575,404 in the same quarter last year[20]. - Operating income for the quarter was $4,899,801, down from $6,658,980 in the previous year, representing a decrease of 26.5%[20]. Capital and Debt - Consolidated debt as of September 30, 2024, was $281,011,068, with total indebtedness at $290,089,471[45]. - The leverage ratio remained stable at 48% as of September 30, 2024, consistent with December 31, 2023[44]. - The weighted average interest rate for total debt outstanding was 4.52% as of September 30, 2024[49]. - The company has a fully drawn $250 million Term Loan with a fixed interest rate of 4.53%[56]. - The company’s net debt to adjusted EBITDA ratio was 7.3x as of September 30, 2024[43]. Investments and Acquisitions - Total property acquisitions from January 1, 2023, to September 30, 2024, amounted to $134,273,574 across 1,730,704 square feet[59]. - The company disposed of properties totaling 405,025 square feet for a total disposition price of $62,731,960[62]. - The total investments in real estate property increased from $524,661,932 to $531,540,076, an increase of approximately 1.7%[51]. - The company has completed significant improvements to previously acquired properties, with $1,600,144 deployed as of September 30, 2024[59]. Tenant and Lease Information - The top 20 tenants contribute $35,881,637 in annual base rent (ABR), representing 89% of the total portfolio[64]. - Industrial core properties account for 77% of the total ABR, totaling $30,796,690[66]. - The largest tenant, Lindsay, contributes $5,333,787 in ABR, accounting for 13% of the total portfolio[64]. - The average lease term for acquired properties is approximately 20 years, with annual rent increases ranging from 2.2% to 3.0%[59]. - Lease expirations indicate that 77% of leased square footage will expire after 2030, totaling 3,458,148 square feet[71]. Cash and Liquidity - Cash and cash equivalents increased to $6,824,847 as of September 30, 2024, compared to $3,129,414 at December 31, 2023[45]. - Distributions payable decreased significantly from $12,174,979 to $1,962,762, a reduction of about 83.9%[51]. - Total liabilities decreased from $305,773,922 to $295,621,276, a reduction of about 3.8%[51]. Non-GAAP Measures - Modiv Industrial, Inc. defines Adjusted EBITDA as GAAP net income adjusted for various non-cash items, providing a clearer view of operating performance[79]. - The company uses Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO) as key non-GAAP measures to assess operating performance[74][75]. - Modiv Industrial, Inc. emphasizes the importance of non-GAAP measures to provide a more complete understanding of its performance relative to competitors[76].

Real Estate Investments - As of September 30, 2024, the net book value of the company's real estate investments was $477,691,631[151]. - The real estate portfolio consists of 43 properties, with 39 industrial properties representing approximately 77% of the portfolio by annualized base rent (ABR) of $40,205,913[152]. - The occupancy rate of the portfolio is 98%, with a weighted average remaining lease term of approximately 13.8 years[152]. - The company sold one industrial property and one office property in early 2024 for a total of $15,265,000, resulting in net gains of $3,359,807[153]. - The company acquired an industrial manufacturing property for $5,125,000 on July 15, 2024, with an initial cap rate of 8.00% and a weighted average cap rate of 10.59%[172]. - During the nine months ended September 30, 2023, the company acquired 12 industrial properties for a total of $129,753,499[173]. - The company transformed its portfolio, with industrial properties comprising 77% of Annual Base Rent (ABR) as of September 30, 2024, up from 76% in December 2023[191]. - The total rental income for the nine months ended September 30, 2024, was $34,833,458, with $26,326,958 from industrial core properties and $8,506,500 from non-core properties[194]. - The company acquired 12 industrial manufacturing properties in 2023 and one additional property in July 2024, continuing its strategic focus on industrial assets[192]. - The company sold 16 non-core properties in 2023 and early 2024, further reducing its exposure to non-core assets[203]. Financial Performance - For the nine months ended September 30, 2024, the company reported a net income attributable to common stockholders of $2,085,698, compared to a net loss of $9,619,835 for the same period in 2023[188]. - The company's Funds From Operations (FFO) attributable to common stockholders was $11,728,308 for the nine months ended September 30, 2024, up from $7,777,265 in the prior year, reflecting a significant increase[188]. - The Adjusted Funds From Operations (AFFO) attributable to common stockholders was $10,919,370 for the nine months ended September 30, 2024, compared to $10,160,506 for the same period in 2023[188]. - Net cash provided by operating activities increased to $12,835,060 for the nine months ended September 30, 2024, up from $11,210,166 in the same period of 2023[178]. - The net cash provided by investing activities in the first nine months of 2024 was $9,881,100, contrasting with a net cash used of $(90,995,924) in the same period of 2023[178]. - Rental income for the nine months ended September 30, 2024 increased by $185,375, or 1%, to $34,833,458 compared to $34,648,083 in the same period of 2023, driven by new property acquisitions[214]. Debt and Financing - As of September 30, 2024, 100% of the company's $281,011,068 outstanding debt is at fixed rates with a weighted average rate of 4.52%[156]. - The company has $150 million of borrowing capacity available under its Credit Facility, which may be utilized for future investments[163]. - The company anticipates potential challenges in refinancing debt obligations due to elevated interest rates and market conditions[157]. - As of September 30, 2024, the outstanding principal balance of mortgage notes payable was $31,011,068, compared to $31,200,000 as of December 31, 2023[171]. - Interest expense for the nine months ended September 30, 2024 rose by $5,752,388, or 85%, to $12,514,167 compared to $6,761,779 in 2023, primarily due to unrealized losses on interest rate swaps[226]. Operational Efficiency - The company successfully negotiated lease extensions for four properties in 2023 and one property in Q3 2024[160]. - General and administrative expenses for Q3 2024 were $1,660,520, a decrease of $74,584, or 4%, from $1,735,104 in Q3 2023, reflecting reduced consulting expenses[205]. - General and administrative expenses for the nine months ended September 30, 2024 decreased by $162,121, or 3%, to $5,078,814 from $5,240,935 in 2023[215]. - Property expenses decreased by $170,173, or 14%, to $1,025,051 in Q3 2024 from $1,195,224 in Q3 2023, primarily due to lower property taxes and maintenance costs[208]. - Stock compensation expense significantly decreased by $8,394,867 to $75,000 in Q3 2024 from $8,469,867 in Q3 2023, due to the final amortization of Class P and Class R OP Units[206]. - Depreciation and amortization expense remained relatively flat at $4,166,992 in Q3 2024 compared to $4,175,209 in Q3 2023, reflecting new property acquisitions offset by disposals[207]. Compliance and Regulations - The company was in compliance with all financial loan covenants as of September 30, 2024[172]. - To maintain REIT status, the company must distribute at least 90% of its annual taxable income[231]. - Failure to maintain REIT qualification could result in taxation at corporate rates and affect net income and cash available for distribution[232]. - The company intends to continue qualifying as a REIT under U.S. federal income tax purposes[231]. - There were no legal proceedings reported as of the filing date[240]. - No significant changes to accounting policies were reported during the nine months ended September 30, 2024[234]. - No changes in internal control over financial reporting were identified that materially affected the reporting[239]. Future Outlook - The company expects an increase in rental income, depreciation expense, and interest expense for the full year of 2024 compared to 2023, driven by recent acquisitions[203]. - The company has not established a minimum distribution level for stockholders[229]. - Distributions are declared one to two months prior to the beginning of a quarter[230]. - Monthly distribution rate for Class C Common Stock is set at $0.09583300 per share from January 2024 to March 2025[230].