Financial Data and Key Metrics - Adjusted distributable earnings for Q3 2023 was $0.57 per weighted average diluted share, up from $0.55 in Q2 [54] - Q3 earnings per weighted average diluted common share was $0.54, compared to $0.47 in Q2 [60] - Net interest income for Q3 remained consistent with the prior quarter at approximately $13.7 million [63] - The book value as of September 30th increased to $15.17 per common share, compared with $15.06 as of June 30th [68] - The dividend payout ratio for Q3 was approximately 83%, with year-to-date distributions at 80% of taxable income [54] Business Line Data and Key Metrics - Total gross originations increased by $35 million in Q3, with $33 million funded to new borrowers, partially offset by $11 million in principal repayments [30] - The loan portfolio had total commitments of $356 million across 27 portfolio companies, with a weighted average yield to maturity of 19.3% [48] - The portfolio was 81% floating rate, down from 88% last quarter, due to three new fixed-rate loans originated in Q3 [49] - Approximately 74% of the portfolio is fully secured by real estate collateral, with a weighted average real estate coverage of 1.5x [68] Market Data and Key Metrics - The pipeline of actionable deals increased to over $600 million from $400 million last quarter, driven by activity in Maryland, Missouri, and Ohio [14] - The company remains focused on core markets with strong moats and operators excelling in fundamentals [15] - Positive momentum was observed in Western states, with wholesale prices showing signs of stabilization [38] Company Strategy and Industry Competition - The company reaffirmed its 2023 outlook based on results through the first nine months of the year [4] - The company is exploring social equity initiatives in other states, leveraging its scale and expertise in real estate, operational, financial, legal, and credit underwriting [47] - The company believes that larger banks entering the cannabis industry will still prefer proven lenders like Chicago Atlantic due to the learning curve and regulatory hurdles [44] Management Commentary on Operating Environment and Future Outlook - Management remains cautiously optimistic, citing positive developments in several states and the potential rescheduling of cannabis from Schedule I to Schedule III [43] - The company expects the elimination of 280E to improve operator profitability and free cash flow, attracting more equity capital [29] - The company aims to approach leverage equal to 100% of book equity, with a near-term target of 50% [52] Other Important Information - The company funded approximately $19 million of the REIT's $50 million commitment to the Social Equity Investment Fund in Q3 [28] - Loan number 9, which was moved to nonaccrual, is expected to be resolved through a sale, with bids anticipated to exceed the carrying value [58][65] Q&A Session Summary Question: Thoughts on Ohio and other new states - Maryland, Ohio, and Missouri are seeing significant movement, with Ohio's recent ballot passing being particularly encouraging [66] Question: Shift to fixed-rate loans - The company does not expect to move to a fixed-rate structure but acknowledges the benefits of having floors in a declining rate environment [5] Question: Creditworthiness and yield compression - The company has not observed yield compression and expects actual yields to remain stable [11] Question: Loan number 9 resolution - The company expects to resolve Loan number 9 through a sale, with bids anticipated to exceed the carrying value [58][65] Question: Dividend and special dividend - The company is on track to pay a special dividend in Q4, targeting a distribution of 90% to 100% of net income [75] Question: Industry outlook and capital needs - The company believes the industry has bottomed out, with positive momentum in Western states and potential for increased capital needs in new states [38][78]

Portfolio Composition - As of September 30, 2023, approximately 81.1% of the company's portfolio consisted of floating rate loans, while 18.9% were fixed rate loans[151]. - The company primarily focuses on financing senior secured loans for established state-licensed operators in the cannabis industry, with loans ranging from $5 million to $200 million[145]. - As of September 30, 2023, 26.3% of the principal of loans held in the company's portfolio were backed by personal or corporate guarantees, up from 13.6% as of December 31, 2022[147]. - The company's loans are secured by real estate and other collateral, with strict loan covenants imposed for additional protection[147]. - As of September 30, 2023, the loan portfolio included 27 loans with a carrying value of approximately $338.8 million, compared to 22 loans valued at $339.3 million as of December 31, 2022[182]. - The outstanding principal of the loan portfolio was approximately $341.8 million as of September 30, 2023, compared to $343.0 million as of December 31, 2022[182]. - The weighted-average yield-to-maturity internal rate of return (YTM IRR) for the loan portfolio was 19.3% as of September 30, 2023, down from 19.7% as of December 31, 2022[182]. - Approximately 81.1% of the loan portfolio consisted of floating rate loans as of September 30, 2023, compared to 83.1% as of December 31, 2022[183]. - The largest loan commitment is $30,000,000 with a carrying value of $29,307,787, yielding an interest rate of P+6.5% Cash[184]. - A loan in Michigan has a commitment of $35,891,668 and a carrying value of $38,299,176, with an interest rate of P+6.65% Cash[184]. - The loan portfolio includes a loan with a commitment of $25,000,000 in Illinois, carrying a value of $20,763,000, with an interest rate of P+6% Cash[184]. - A loan in Florida has a commitment of $13,000,000 and a carrying value of $4,863,651, with an interest rate of P+9.25% Cash[184]. - The company has a loan with a commitment of $18,746,662 in New York, carrying a value of $18,417,846, with an interest rate of 15% Cash[186]. - The company has a loan in Ohio with a commitment of $15,000,000, carrying a value of $14,831,662, with an interest rate of P+1.75% Cash[186]. Financial Performance - The company aims to provide attractive, risk-adjusted returns primarily through consistent current income dividends and capital appreciation[144]. - Interest income increased by approximately $1.4 million, or 10%, during the quarter ended September 30, 2023, driven by an increase in the Prime Rate from 6.25% to 8.50%[176]. - Net interest income rose approximately $0.8 million or 6% over the comparative period, attributed to increased interest income offset by higher interest expenses[176]. - Interest income for the nine months ended September 30, 2023, increased by approximately $10.9 million, or 31%, compared to the same period in 2022[179]. - Distributable Earnings for the three months ended September 30, 2023, were $10,537,182, compared to $10,299,294 for the same period in 2022[194]. - Net income for the nine months ended September 30, 2023, was approximately $29.3 million, an increase of $4.3 million compared to $25.0 million for the same period in 2022[202]. - Net cash provided by operating activities increased to approximately $12.9 million in 2023 from $12.4 million in 2022, reflecting a growth of about 4%[203]. - Net cash provided by investing activities was approximately $8.8 million in 2023, a significant recovery from a cash outflow of approximately $120.7 million in 2022[205]. - Cash outflows for loan origination and funding were $67.4 million in 2023, down from $134.3 million in 2022, indicating a reduction of approximately 50%[206][207]. - Net cash used in financing activities was approximately $18.7 million in 2023, compared to a net cash inflow of $37.4 million in 2022[208]. - Cash inflows from common stock sales through direct offerings totaled approximately $7.2 million in 2023, including $6.0 million from a registered direct offering[209]. - Total cash dividends declared for the nine months ended September 30, 2023, amounted to $1.41 per common share, compared to $1.34 per common share in 2022, representing an increase of approximately 5.2%[215]. - The company intends to pay dividends to stockholders in an amount equal to its net taxable income, subject to Board authorization[192]. Risk Management - The company is exposed to market risks primarily related to fluctuations in interest rates, which could impact net interest income and overall financial performance[231]. - The company’s loan portfolio is concentrated in the cannabis industry, which involves significant risks due to federal illegality and regulatory changes[237]. - As of September 30, 2023, the principal amounts of loans are generally protected by underlying collateral value, but risks remain for loans not fully collateralized by real estate[241]. - The company has recorded zero realized loan losses since its inception, indicating strong loan performance and risk management[221]. - The CECL Reserve is estimated using a third-party probability-weighted model, considering historical loss data and macroeconomic forecasts[216][224]. - The top three borrowers represented approximately 29.7% of principal outstanding as of September 30, 2023, with the largest loan accounting for approximately 11.2%[244]. - As of September 30, 2023, 74% of the portfolio was fully secured by real estate, with an average real estate collateral coverage of 1.5x[241]. - The current expected credit loss reserve was approximately $5.1 million, representing 150 basis points of aggregate loan commitments as of September 30, 2023[178]. - The decrease in expected credit losses was attributed to changes in risk ratings and improvements in enterprise valuations of borrowers during the nine months ended September 30, 2023[183]. Operational Strategy - The company intends to grow its portfolio by continuing to make loans to leading operators in the cannabis industry, although there is no assurance of achieving its investment objectives[144]. - The company expects to raise additional equity and/or debt financing to increase liquidity as the cannabis industry evolves[197]. - The company has a Revolving Loan with an outstanding balance of $63.0 million, which is also subject to market interest rate fluctuations[232]. - The company has not incurred any excise tax expense for the three and nine months ended September 30, 2023, indicating compliance with REIT distribution requirements[159]. - The company operates as a commercial mortgage real estate investment trust (REIT) and has elected to be taxed as a REIT since December 31, 2021[149]. - The Shelf Registration Statement became effective on January 19, 2023, allowing the Company to sell up to $500 million of its securities[201].

Financial Data and Key Metrics Changes - Adjusted distributable earnings decreased to $0.55 per weighted average diluted share for Q2 from $0.62 in Q1, while diluted earnings per weighted average common share fell to $0.47 from $0.60 in Q1, primarily due to a higher provision for expected credit losses and stock-based compensation [10] - Total operating expenses before CECL provision decreased by 5.8%, mainly due to a reduction in net management and incentive fees [10] - The company increased its CECL reserve by $1.1 million as of June 30 [10] Business Line Data and Key Metrics Changes - The loan portfolio had total loan commitments of $329 million across 25 portfolio companies, with a weighted average yield to maturity of 19.2%, slightly down from 19.4% at March 31 [20] - New originations were limited to $1.9 million, offset by $6.9 million in principal repayments, with $5 million related to unscheduled early repayments [20] - The portfolio remains 88% floating rate based on the prime rate, consistent with the last quarter and up from 60% in June 2022 [20] Market Data and Key Metrics Changes - The company noted improvements in wholesale pricing in limited license states transitioning from medical to adult-use, indicating a cautiously optimistic outlook [18] - The Federal Reserve's recent rate increase to 8.5% is expected to positively impact portfolio yield [20] Company Strategy and Development Direction - The company is focused on a partnership with New York, committing $150 million to the New York State Cannabis Social Equity Investment Fund, with plans to replicate this model in other states [44] - The company aims to remain disciplined in pursuing new opportunities while navigating the current economic environment [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the volatility in the financial sector and cannabis industry, emphasizing the importance of yield in the current market [17] - The company is optimistic about transaction activity in states like Maryland and Missouri, with a robust pipeline of actionable deals exceeding $400 million [31] Other Important Information - The company’s balance sheet remains under-levered at 16% of book equity, with a debt service coverage ratio of 11.5:1, significantly above the requirement of 1.35:1 [46] - Approximately 74% of the portfolio is fully secured by real estate collateral, with a weighted average real estate collateral coverage of 1.5x as of June 30 [23] Q&A Session Summary Question: Additional details on the New York deal and potential timing for additional capital - The company is committed to the New York partnership and is working on identifying and due diligence of dispensary locations [44] Question: Observations on industry headwinds and geographic weaknesses - Management reported efficiency in operations and mentioned a scheduled sale, indicating proactive measures in response to challenges [41] Question: Details on the non-accrual loan and its implications - The carrying value of the non-accrual loan is $16.2 million, with $600,000 of income that would have been recognized had it not been placed on non-accrual status [56]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 ☐ 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: 001-41123 CHICAGO ATLANTIC REAL ESTATE FINANCE, INC. (Exact name of registrant as specified in its charter) (State or other ...

Chicago Atlantic Real Estate Finance, Inc. (NASDAQ:REFI) Q1 2023 Earnings Conference Call May 9, 2023 9:00 AM ET Company Participants Harry Sullivan - SCR Partners John Mazarakis - Executive Chairman Anthony Cappell - CEO & Director Phillip Silverman - Interim CFO, Company Secretary & Controller Conference Call Participants Aaron Hecht - JMP Securities Mark Smith - Lake Street Capital Markets Operator Good day, and thank you for standing by. Welcome to the Chicago and Atlantic Real Estate Finance, Inc. Firs ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 ☐ 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: 001-41123 CHICAGO ATLANTIC REAL ESTATE FINANCE, INC. (Exact name of registrant as specified in its charter) (State or other ...

Important Disclosure Information In this presentation, the Company relies on and refers to certain information and statistics obtained from third-party sources which it believes to be reliable, including reports by market research firms. The Company has not independently verified the accuracy or completeness of any such third-party information. Because the cannabis industry is relatively new and rapidly evolving, such market and industry data may be subject to significant change in a relatively short time p ...

Financial Data and Key Metrics Changes - Net interest income increased by $1.8 million or 14.1% to $14.8 million compared to $12.9 million in Q3, with total net interest income for the year at $48.9 million [79] - Adjusted distributable earnings per share for Q4 was $0.57, and $2.11 for the year ended December 31, 2022, with total dividend distributions amounting to $2.10 per share for the year, approximately 99.5% of adjusted distributable earnings [80] - Diluted earnings per common share for the year was $1.82, with Q4 diluted earnings per share at $0.41, a decrease of $0.14 primarily due to increased provision for expected credit losses [81] Business Line Data and Key Metrics Changes - The loan portfolio grew to total loan commitments of $351 million across 22 portfolio companies, with a weighted average yield to maturity of 19.7%, up from 18.3% at September 30 [68] - The percentage of floating rate loans increased from 60% to 83% as of year-end, benefiting from rising rates [75] Market Data and Key Metrics Changes - The cannabis industry is projected to grow from a current size of $30 billion to $40 billion to an expected $50 billion to $75 billion in retail sales within the next five years [11] - Missouri and Maryland have transitioned to adult use, with Missouri exceeding expectations in sales after legalization [12][55] Company Strategy and Development Direction - The company aims to maintain a conservative approach to capital deployment, focusing on strong credit operators and fulfilling growth capital needs of existing borrowers [72] - The strategy includes targeting limited licensed states and monitoring local market pricing to maximize returns on a risk-adjusted basis [63] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about rising interest rates and their potential impact on disposable income and the broader economy, indicating a cautious approach to portfolio management [33][34] - The company remains optimistic about the cannabis market's growth potential, particularly with the anticipated transition from medical to recreational sales in certain states [36][58] Other Important Information - The company expanded its credit facility to $92.5 million and retained an option for a one-year extension without fees [16] - The CECL reserve approximated 1.2% of outstanding principal as of Q4, with 87% of the portfolio secured by real estate [24] Q&A Session Summary Question: What carries the most risk for the portfolio in 2023? - Management indicated that they want to be conservative and are closely monitoring the portfolio, acknowledging that rising interest rates and broader economic headwinds are significant concerns [27][28] Question: How is the health of the borrower base? - Management noted that the portfolio is performing well, with a focus on strong credit operators and a commitment to maintaining a robust underwriting process [29][84] Question: What is the expected loan deployment volume for 2023? - The company plans for loan deployment between $20 million and $30 million in Q1 and Q2, with expectations to grow the credit facility further [39][41] Question: Which states are currently causing stress in operations? - Management highlighted Pennsylvania and Ohio as states of concern due to their conservative medical markets, while expressing optimism about Maryland and Missouri [43][52] Question: How does the company view the pipeline for new loans? - Management expressed confidence in the pipeline, noting that demand for capital significantly exceeds supply, allowing for selective underwriting [47][66]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 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 December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-41123 CHICAGO ATLANTIC REAL ESTATE FINANCE, INC. (Exact name of Registrant as specified in its charter) | Maryland 86-3125132 | | | --- | --- | | (State or other jurisdiction of ...

Third Quarter 2022 Earnings Supplemental November 9, 2022 Important Disclosure Information This presentation contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, regarding future events and the future results of the Company that are based on current expectations, estimates, forecasts, projections about the industry in which the Company operates and the beliefs and assumptions of the management of the Company. Words such as "address," "anticipate," ...