PART I. FINANCIAL INFORMATION [Item 1. Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) Presents unaudited consolidated financial statements and comprehensive notes on business, accounting, investments, and debt [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Summarizes the company's financial position, including assets, liabilities, and equity at specific dates Consolidated Balance Sheet Highlights (Unaudited) | Metric | March 31, 2024 ($) | June 30, 2023 ($) | | :-------------------------------- | :------------- | :------------ | | Total real estate assets, net | $195,176,549 | $170,715,312 | | Cash and cash equivalents | $15,462,084 | $17,242,781 | | Investments, at fair value | $4,037,437 | $13,432,480 | | Unconsolidated investment (non-security), at fair value | $7,629,958 | $8,716,500 | | Total assets | $226,085,826 | $213,157,593 | | Mortgage notes payable, net | $106,137,059 | $91,247,384 | | Total liabilities | $118,371,717 | $102,145,587 | | Total stockholders' equity | $86,309,632 | $98,908,132 | | Non-controlling interests | $21,404,477 | $12,103,874 | | Total equity | $107,714,109 | $111,012,006 | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Details the company's revenues, expenses, and net loss for the reported periods Consolidated Statements of Operations Highlights (Unaudited) | Metric | Three Months Ended March 31, 2024 ($) | Three Months Ended March 31, 2023 ($) | Nine Months Ended March 31, 2024 ($) | Nine Months Ended March 31, 2023 ($) | | :---------------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------- | :------------------------------- | | Rental and reimbursements revenue | $4,079,036 | $4,469,869 | $11,216,503 | $11,212,624 | | Total operating expenses | $6,756,922 | $13,703,596 | $18,509,191 | $27,655,122 | | Operating loss | $(2,677,886) | $(9,233,727) | $(7,292,688) | $(16,442,498) | | Net loss | $(2,948,261) | $(10,238,617) | $(8,710,568) | $(13,851,187) | | Net loss attributable to common stockholders | $(3,496,899) | $(10,494,359) | $(10,033,020) | $(14,397,810) | | Net loss per share attributable to common stockholders | $(0.26) | $(0.79) | $(0.75) | $(1.08) | [Consolidated Statements of Changes in Equity (2024)](index=5&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity%20for%20the%20three%20and%20nine%20months%20ended%20March%2031%2C%202024) Outlines changes in common stock, preferred stock, additional paid-in capital, and accumulated deficit for 2024 Changes in Equity (Three Months Ended March 31, 2024) | Metric | Common Stock (Shares) | Common Stock (Par Value) ($) | Series A Preferred Stock (Shares) | Series A Preferred Stock (Par Value) ($) | Series B Preferred Stock (Shares) | Series B Preferred Stock (Par Value) ($) | Additional Paid-in Capital ($) | Accumulated Deficit ($) | Total Stockholders' Equity ($) | Non-controlling Interests ($) | Total Equity ($) | | :------------------------------------ | :-------------------- | :----------------------- | :-------------------------------- | :----------------------------------- | :-------------------------------- | :----------------------------------- | :------------------------- | :------------------ | :------------------------- | :------------------------ | :----------- | | Balance, Dec 31, 2023 | 13,239,849.36 | $1,324 | 743,462.31 | $75 | 4,444.44 | $0 | $135,164,330 | $(44,697,434) | $90,468,295 | $12,106,580 | $102,574,875 | | Net loss | - | - | - | - | - | - | - | $(3,207,051) | $(3,207,051) | $258,790 | $(2,948,261) | | Balance, March 31, 2024 | 13,302,775.40 | $1,331 | 754,939.83 | $75 | 16,612.44 | $2 | $136,162,782 | $(49,854,558) | $86,309,632 | $21,404,477 | $107,714,109 | Changes in Equity (Nine Months Ended March 31, 2024) | Metric | Common Stock (Shares) | Common Stock (Par Value) ($) | Series A Preferred Stock (Shares) | Series A Preferred Stock (Par Value) ($) | Series B Preferred Stock (Shares) | Series B Preferred Stock (Par Value) ($) | Additional Paid-in Capital ($) | Accumulated Deficit ($) | Total Stockholders' Equity ($) | Non-controlling Interests ($) | Total Equity ($) | | :------------------------------------ | :-------------------- | :----------------------- | :-------------------------------- | :----------------------------------- | :-------------------------------- | :----------------------------------- | :------------------------- | :------------------ | :------------------------- | :------------------------ | :----------- | | Balance, June 30, 2023 | 13,243,279.96 | $1,324 | 671,340.45 | $67 | - | $0 | $133,762,999 | $(34,856,258) | $98,908,132 | $12,103,874 | $111,012,006 | | Net loss | - | - | - | - | - | - | - | $(9,195,967) | $(9,195,967) | $485,399 | $(8,710,568) | | Balance, March 31, 2024 | 13,302,775.40 | $1,331 | 754,939.83 | $75 | 16,612.44 | $2 | $136,162,782 | $(49,854,558) | $86,309,632 | $21,404,477 | $107,714,109 | [Consolidated Statements of Changes in Equity (2023)](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity%20for%20the%20three%20and%20nine%20months%20ended%20March%2031%2C%202023) Outlines changes in common stock, preferred stock, additional paid-in capital, and accumulated deficit for 2023 Changes in Equity (Three Months Ended March 31, 2023) | Metric | Common Stock (Shares) | Common Stock (Par Value) ($) | Series A Preferred Stock (Shares) | Series A Preferred Stock (Par Value) ($) | Additional Paid-in Capital ($) | Accumulated Deficit ($) | Total Stockholders' Equity ($) | Non-controlling Interests ($) | | :------------------------------------ | :-------------------- | :----------------------- | :-------------------------------- | :----------------------------------- | :------------------------- | :------------------ | :------------------------- | :------------------------ | | Balance, Dec 31, 2022 | 13,254,497.43 | $1,325 | 505,115.06 | $51 | $130,274,766 | $(30,858,855) | $99,417,287 | $8,884,148 | | Net loss | - | - | - | - | - | $(10,284,739) | $(10,284,739) | $46,122 | | Balance, March 31, 2023 | 13,241,026.32 | $1,324 | 588,577.64 | $59 | $132,061,537 | $(42,874,199) | $89,188,721 | $12,003,000 | Changes in Equity (Nine Months Ended March 31, 2023) | Metric | Common Stock (Shares) | Common Stock (Par Value) ($) | Series A Preferred Stock (Shares) | Series A Preferred Stock (Par Value) ($) | Additional Paid-in Capital ($) | Accumulated Deficit ($

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) The company's Q3 2023 financials show decreased assets and equity, with a net loss driven by investment performance [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets and equity declined by September 30, 2023, due to lower cash and investment values **Consolidated Balance Sheet Highlights (Unaudited)** | Account | September 30, 2023 | June 30, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$210,912,522** | **$213,157,593** | | Total real estate assets, net | $174,281,506 | $170,715,312 | | Cash and cash equivalents | $13,981,263 | $17,242,781 | | Investments, at fair value | $11,986,262 | $13,432,480 | | **Total Liabilities** | **$104,972,352** | **$102,145,587** | | Mortgage notes payable, net | $94,146,609 | $91,247,384 | | **Total Equity** | **$105,940,170** | **$111,012,006** | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The company reported a $4.2 million net loss for Q3 2023, a reversal from a profit in Q3 2022 **Statement of Operations Summary (Unaudited)** | Metric | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Rental and reimbursements | $3,559,981 | $3,068,503 | | Total operating expenses | $5,816,596 | $5,586,535 | | Operating loss | ($2,256,615) | ($2,518,032) | | Net income (loss) | **($4,208,702)** | **$1,286,454** | | Net income (loss) attributable to common stockholders | ($4,597,421) | $1,166,345 | | Net income (loss) per share | **($0.35)** | **$0.09** | [Consolidated Statements of Changes in Equity](index=5&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity) Total equity decreased to $105.9 million, impacted by a net loss and dividend payments - Key changes in equity for the three months ended September 30, 2023 include a **net loss of $4.3 million**, common stock dividends of $1.7 million, and preferred stock dividends of $0.3 million[13](index=13&type=chunk) - The company issued **$1.4 million in preferred stock** and $0.4 million in common stock through dividend reinvestment, while repurchasing $0.5 million of common stock[13](index=13&type=chunk) [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash decreased by $3.5 million in Q3 2023, driven by significant investments in real estate assets **Cash Flow Summary (Unaudited)** | Activity | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net cash from operating activities | $517,066 | ($850,176) | | Net cash from investing activities | ($5,427,818) | $553,133 | | Net cash from financing activities | $1,451,608 | $3,210,829 | | **Net increase (decrease) in cash** | **($3,459,144)** | **$2,913,786** | [Notes to Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail the company's REIT structure, accounting policies, investments, debt, and related party transactions [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the REIT transition, Q3 2023 operational results, and market risks from inflation - The company's investment strategy is to invest at least **80% of total assets in equity or debt in real estate assets** and up to 20% in investment securities of real estate companies[156](index=156&type=chunk) - The company plans to develop a **72-unit multi-family residential community** in Fairfield, CA, with construction expected to begin in early Spring 2024[174](index=174&type=chunk) - Management acknowledges risks from **increased inflation and higher interest rates**, which have increased variable rate borrowing costs and could adversely impact real estate asset values[179](index=179&type=chunk) [Results of Operations](index=37&type=section&id=Results%20of%20Operations) Rental revenue grew due to acquisitions, but a significant unrealized investment loss drove a net loss for Q3 2023 **Key Operational Metrics Comparison (Q3 2023 vs Q3 2022)** | Metric | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Rental and reimbursements revenues | $3.56 million | $3.07 million | | Asset management fee | $0.79 million | $0.72 million | | Property operating and maintenance | $1.39 million | $1.83 million | | Depreciation and amortization | $1.56 million | $0.91 million | | Interest expense | $1.32 million | $1.59 million | | Net unrealized gain (loss) on investments | ($2.27 million) | $2.84 million | - The increase in rental revenue was mainly due to the **acquisition of three commercial properties** since September 2022[181](index=181&type=chunk) - The decrease in property operating expenses was mainly due to the **sale of the Addison Property** in June 2023, partially offset by acquisitions of new office buildings[189](index=189&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains sufficient liquidity from stock offerings and operations to meet its obligations - As of September 30, 2023, the company had raised **$17.72 million from its Series A preferred stock offering** and plans to fund future investments with these proceeds and cash from operations[200](index=200&type=chunk) - For the three months ended September 30, 2023, **cash decreased by $3.46 million**, driven by $5.43 million used in investing activities, primarily for real estate acquisitions[205](index=205&type=chunk) **Debt Maturity Schedule** | Fiscal Year Ending June 30, | Debt Maturing | | :--- | :--- | | 2024 (remainder) | $943,436 | | 2025 | $22,237,498 | | 2026 | $11,024,219 | | Thereafter | $62,570,297 | | **Total** | **$96,775,450** | [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are from illiquid real estate investments and variable-rate debt - The company's primary market risk stems from its **speculative and illiquid investments** in smaller U.S. real estate companies[219](index=219&type=chunk) - The company is exposed to interest rate risk on **$17.5 million of variable-rate debt** indexed to SOFR, managed through an interest rate cap agreement[220](index=220&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no material changes in the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's **disclosure controls and procedures were effective** as of September 30, 2023[221](index=221&type=chunk) - **No changes occurred** during the fiscal quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[222](index=222&type=chunk) [PART II. OTHER INFORMATION](index=43&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no legal proceedings - **None**[224](index=224&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors were reported since the last annual report - There have been **no material changes** to risk factors from the annual report on Form 10-K for the fiscal year ended June 30, 2023[225](index=225&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company issued preferred and common shares and repurchased common stock during the quarter - In July 2023, **2,265 common shares were issued at $10.25 per share** upon conversion of Class A units of the Operating Partnership[226](index=226&type=chunk) - During the quarter, the company issued **54,394.20 Series A preferred shares for gross proceeds of $1,359,350**, plus an additional 1,771.45 shares via the DRIP[227](index=227&type=chunk) **Issuer Purchases of Equity Securities (Q3 2023)** | Security | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | Common stocks | 64,092.00 | $7.38 | [Defaults Upon Senior Securities](index=43&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - **None**[230](index=230&type=chunk) [Mine Safety Disclosures](index=43&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - **Not applicable**[231](index=231&type=chunk) [Other Information](index=43&type=section&id=Item%205.%20Other%20Information) The company reported no other information - **None**[232](index=232&type=chunk) [Exhibits](index=44&type=section&id=Item%206.%20Exhibits) The report includes required CEO and CFO certifications and Inline XBRL data files as exhibits - Key exhibits filed include **Section 302 and Section 1350 certifications** by the CEO and CFO[233](index=233&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission file number: 000-55006 MACKENZIE REALTY CAPITAL, INC. (Exact Name of Registrant as Specified in its Charter) (State or Other Jurisdiction of Inc ...

For the transition period from _________ to __________ Commission file number 000-55006 MacKenzie Realty Capital, Inc. (Exact name of registrant as specified in its charter) UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark one) ☑ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 ☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (State or other jurisdiction o ...