Core Viewpoint - Sunrise Realty Trust, Inc. has declared a quarterly dividend of $0.30 per share for the quarter ending December 31, 2025, which is consistent with the previous quarter's dividend [2]. Company Overview - Sunrise Realty Trust, Inc. (Nasdaq: SUNS) is an institutional commercial real estate lender that provides flexible financing solutions primarily in the Southern United States, focusing on transitional commercial real estate projects with potential for near-term value creation [3]. - The company is part of the Tannenbaum Capital Group (TCG) Real Estate platform, which includes affiliated debt funds and aims to capitalize on top-tier assets in rapidly expanding Southern markets [4].

Economic Overview - The year 2025 has been challenging for mortgage real estate investment trusts (mREITs) focused on commercial mortgages due to a decline in U.S. economic momentum [1] - The unemployment rate increased to 4.44% in September 2025, indicating economic stress [1] Investment Insights - The investment approach focuses on fundamental long-term perspectives, particularly in REITs, preferred stocks, and high-yield bonds [1] - The strategy includes combining long stock positions with covered calls and cash secured puts, reflecting a tactical investment methodology [1]

Financial Data and Key Metrics Changes - For the quarter ended September 30, 2025, the company generated distributable earnings of $0.31 per share, covering the dividend of $0.30 per share [5][13] - The net interest income for the same quarter was reported at $6.1 million, with GAAP net income of $4.05 million [13][14] - As of September 30, 2025, total assets were $258.8 million, and total shareholder equity was $184.6 million, resulting in a book value of $13.76 per share [14] Business Line Data and Key Metrics Changes - The company’s portfolio had $367 million in commitments, with $253 million funded across 13 loans as of September 30, 2025 [14] - Subsequent to the quarter end, the company closed on $56 million of loan commitments, including a $30 million senior bridge loan for a retail property refinancing [12] Market Data and Key Metrics Changes - The company noted a significant increase in financing requests compared to the first half of the year, attributed to borrowers' confidence in declining short-term interest rates [8][9] - Traditional commercial banks are gradually re-entering the market, focusing on lower leverage lending, which is seen as a positive sign for liquidity in the commercial real estate financing ecosystem [9][10] Company Strategy and Development Direction - The company focuses on originating transitional loans primarily in the southern United States, leveraging local expertise for attractive risk-adjusted returns [5][6] - The long-term goal is to achieve an investment-grade rating within the next three to five years, with a current leverage of approximately 0.4 times, significantly below the peer average [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current market environment, noting a healthy increase in transaction volume and a narrowing bid-ask spread [9][10] - The company remains focused on transitional real estate projects, which are believed to provide the strongest risk-adjusted returns [10] Other Important Information - The weighted average loan-to-cost at closing is reported at 56%, contributing to strong credit performance [6] - Approximately 95% of the company’s loans are floating rate, with an average SOFR floor of about 4%, which is expected to enhance net interest margins as SOFR decreases [6] Q&A Session Summary Question: What new geographies within the southern U.S. are being seen in the pipeline? - The company is focusing on Florida, Texas, North Carolina, Georgia, and Tennessee, with ongoing deal flow in these areas [16][17] Question: Are there any geographies that stand out as the most attractive for investment? - Texas and Florida continue to present interesting opportunities, with the Carolinas and Tennessee also being areas of focus [18][19] Question: How is the debt side of the business strategy progressing? - The company is not pursuing a repo line and aims for an investment-grade rating, focusing on expanding bank lines and considering preferred or unsecured debt offerings [24][25] Question: How is the portfolio performing and what trends are being observed? - The portfolio is performing as expected, with steady progress in construction activities and a recent pickup in for-sale projects due to migration trends [30][31]

Financial Data and Key Metrics Changes - For Q3 2025, the company generated distributable earnings of $0.31 per share, covering the dividend of $0.30 per share [5][13] - Net interest income for the quarter was $6.1 million, with GAAP net income at $4.05 million [13][14] - The company ended the quarter with total assets of $258.8 million and total shareholder equity of $184.6 million, resulting in a book value of $13.76 per share [14] Business Line Data and Key Metrics Changes - The portfolio had $367 million in commitments and $253 million in principal outstanding across 13 loans as of September 30, 2025 [14] - The weighted average loan-to-cost at closing was 56%, indicating conservative positioning [6] - Approximately 95% of the loans are floating rate, with an average SOFR floor of about 4% [6] Market Data and Key Metrics Changes - There has been a notable increase in financing requests, indicating a recovery in the real estate market [8][9] - The bid-ask spread between buyers and sellers is narrowing, which is increasing transaction volume [9] - Most new financing activity is concentrated in the bridge lending space, particularly in multifamily and industrial properties [10] Company Strategy and Development Direction - The company focuses on originating transitional loans primarily in the southern United States, aiming for attractive risk-adjusted returns [5][6] - The long-term goal is to achieve an investment-grade rating within the next three to five years [6] - The company is expanding its real estate pipeline, with two signed non-binding term sheets totaling approximately $170 million [11] Management's Comments on Operating Environment and Future Outlook - Management noted a renewed sense of interest rate stability, encouraging more sponsors to engage in capital planning [8] - The company remains confident in its ability to capitalize on attractive opportunities in the current market environment [12] - The underlying performance of the portfolio is progressing as expected, with no significant issues reported [30][31] Other Important Information - The company has a CESL reserve of approximately $400,000, or 17 basis points for loans at carrying value [14] - The board declared a dividend of $0.30 per share, paid on October 15, 2025 [13] Q&A Session Summary Question: What new geographies within the southern U.S. are being seen in the pipeline? - The company is focusing on Florida, Texas, North Carolina, Georgia, and Tennessee for new deals [17][18] Question: Are there any geographies that stand out as the most attractive for investment? - Texas and Florida continue to present interesting opportunities, with the Carolinas and Tennessee also being areas of focus [18][19] Question: How is the debt side of the business strategy progressing? - The company is not pursuing a repo line and is focused on obtaining an investment-grade rating while expanding bank lines [24][25] Question: How is the portfolio performing and what trends are being observed? - The portfolio is performing as expected, with steady progress in construction and sales [30][31]

Financial Data and Key Metrics Changes - For Q3 2025, the company generated distributable earnings of $0.31 per share, covering the dividend of $0.30 per share [5][15] - The net interest income for the quarter was $6.1 million, with GAAP net income of $4.05 million [14][15] - As of September 30, 2025, total assets were $258.8 million, and total shareholder equity was $184.6 million, resulting in a book value of $13.76 per share [16] Business Line Data and Key Metrics Changes - The company’s portfolio had $367 million in commitments and $253 million in principal outstanding across 13 loans as of September 30, 2025 [16] - The weighted average loan-to-cost at closing was only 56%, indicating conservative positioning [6] - The portfolio yield to maturity was approximately 11.8% [16] Market Data and Key Metrics Changes - There has been a notable increase in financing requests, indicating a recovery in the real estate market [9] - The bid-ask spread between buyers and sellers is narrowing, which is increasing transaction volume [10] - Most new financing activity is concentrated in the bridge lending space, particularly in multifamily and industrial properties [11] Company Strategy and Development Direction - The company focuses on originating transitional loans primarily in the southern United States, aiming for attractive risk-adjusted returns [5][6] - The long-term goal is to achieve an investment-grade rating within the next three to five years [6] - The company is expanding its presence in the southern U.S., with a focus on states like Florida, Texas, North Carolina, Georgia, and Tennessee [19][20] Management's Comments on Operating Environment and Future Outlook - Management noted a renewed sense of interest rate stability, encouraging more sponsors to engage in capital planning [9] - The company remains confident in its ability to capitalize on attractive opportunities in the current market environment [13] - The underlying construction activity and progression of loans are performing as expected, with no significant issues reported [32] Other Important Information - The company has a CESL reserve of approximately $400,000, or 17 basis points for loans at carrying value [16] - The company is not pursuing a repo line and aims to maintain a conservative leverage strategy [26][29] Q&A Session Summary Question: What new geographies within the southern U.S. are being seen in the pipeline? - The company is focusing on Florida, Texas, North Carolina, Georgia, and Tennessee, with a preponderance of deals in these areas [19] Question: Are there any geographies that stand out as the most attractive for investment? - Texas and Florida continue to present interesting opportunities, with the Carolinas and Tennessee also being areas of focus [20] Question: How is the debt side of the business strategy progressing? - The company is focused on expanding bank lines and is considering preferred or unsecured debt offerings, avoiding high-leverage deals [26][27][29] Question: How is the portfolio performing and what trends are being observed? - The portfolio is performing as expected, with steady progress in construction and sales, and a recent pickup in for-sale projects noted [32]

Company Overview - Sunrise Realty Trust (SUNS) is an institutional lender focused on originating and funding commercial real estate loans, primarily in the Southern United States[16] - The company targets a portfolio net internal rate of return (IRR) in the low-teens[16] - The management team has structured over $21 billion in CRE and credit transactions[16] Market Opportunity - Approximately $656 billion of CRE deals have been sourced by SUNS Manager and its affiliates since October 2023, with the company pursuing only about 16% of these deals[17] - Over $2 trillion in CRE loans are maturing by the end of 2027, creating an opportunity for SUNS to scale quickly[17] - Target states in the Southern U S have experienced significant population and employment growth from Q4 2019 to Q2 2025, with total population increasing by 89% and total employment by 106%, outpacing the rest of the U S [34] Portfolio Composition - As of November 3, 2025, total current commitments were $4211 million, with a principal balance of $2952 million and a weighted average yield to maturity of 118%[55] - Senior loans constitute 94% of the portfolio, while subordinate loans make up the remaining 6%[59] - Residential assets account for 62% of the portfolio, with geographic exposure concentrated in Florida (52%) and Texas (35%)[59] Financial Performance - For the three months ended September 30, 2025, net income was $405 million, or $030 per basic common share[66] - Distributable earnings for the same period were $412 million, or $031 per basic weighted average share[67] - Loans held for investment at carrying value, net of current expected credit loss reserve, totaled $25023 million as of September 30, 2025[65]

Core Viewpoint - Sunrise Realty Trust, Inc. reported quarterly earnings of $0.31 per share, matching the Zacks Consensus Estimate and showing an increase from $0.25 per share a year ago [1]. Financial Performance - The company posted revenues of $6.06 million for the quarter ended September 2025, which was 2.32% below the Zacks Consensus Estimate, compared to $3.18 million in the same quarter last year [2]. - Over the last four quarters, Sunrise Realty Trust has surpassed consensus EPS estimates two times and topped consensus revenue estimates only once [1][2]. Stock Performance - Shares of Sunrise Realty Trust have declined approximately 33.3% since the beginning of the year, while the S&P 500 has gained 16.5% [3]. - The current Zacks Rank for the stock is 3 (Hold), indicating expected performance in line with the market in the near future [6]. Future Outlook - The consensus EPS estimate for the upcoming quarter is $0.32 on revenues of $6.56 million, and for the current fiscal year, it is $1.23 on revenues of $23 million [7]. - The outlook for the Real Estate - Operations industry, to which the company belongs, is currently in the bottom 37% of over 250 Zacks industries, which may impact stock performance [8].

Financial Performance - For the third quarter of 2025, Sunrise Realty Trust, Inc. reported GAAP net income of $4.05 million, or $0.30 per basic weighted average common share, and Distributable Earnings of $4.12 million, or $0.31 per basic weighted average common share[1][2]. - The company paid a cash dividend of $0.30 per common share, distributing a total of $4.0 million in dividends, which is slightly lower than the Distributable Earnings of $0.31 per share for the same period[4]. - The reconciliation of GAAP net income to Distributable Earnings showed a total of $4.12 million in Distributable Earnings for the quarter, compared to $1.85 million for the same period in 2024, indicating a significant year-over-year increase[16]. - The basic weighted average shares of common stock outstanding for the quarter were 13,247,030, compared to 6,800,500 shares in the same quarter of the previous year[16]. - The company emphasizes the importance of Distributable Earnings as a non-GAAP financial measure to assess overall performance, which is useful for investors[11][15]. Business Strategy - The CEO highlighted the company's focus on originating loans for transitional real estate assets primarily in the Southern United States, aiming for a consistent and stable dividend while diversifying the portfolio[3]. - The company continues to focus on transitional commercial real estate projects that present opportunities for near-term value creation, particularly in rapidly expanding Southern markets[9][10]. Future Outlook - Forward-looking statements indicate that the company anticipates future growth and strategies, although actual results may differ due to various uncertainties[17]. Regulatory Compliance - The company filed its Quarterly Report on Form 10-Q with the SEC on November 13, 2025, providing detailed financial information for investors[5]. - The company encourages stakeholders to monitor its Investor Relations webpage for important updates and disclosures[6].

Core Insights - Sunrise Realty Trust, Inc. reported a GAAP net income of $4.05 million or $0.30 per basic weighted average common share for Q3 2025, with Distributable Earnings of $4.12 million or $0.31 per share [1][2]. Financial Performance - The company paid a cash dividend of $0.30 per common share on October 15, 2025, distributing a total of $4.0 million in dividends, which is slightly lower than the Distributable Earnings of $0.31 per share for the same period [4]. - The reconciliation of GAAP net income to Distributable Earnings shows that for the three months ended September 30, 2025, the Distributable Earnings amounted to $4.12 million, reflecting adjustments for stock-based compensation and expected credit losses [16][18]. Strategic Focus - The CEO emphasized the company's commitment to its strategic objectives established 18 months ago, focusing on originating loans for transitional real estate assets primarily in the Southern United States [3]. - The company aims to diversify its portfolio across various asset classes, geographies, and borrowers while maintaining a consistent and stable dividend [3]. Company Overview - Sunrise Realty Trust, Inc. operates as an institutional commercial real estate lender, providing flexible financing solutions for commercial real estate projects, particularly in the Southern U.S. [8]. - The company is part of the Tannenbaum Capital Group's real estate platform, which includes affiliated debt funds focused on transitional commercial real estate properties [10].

Dividends and Shareholder Returns - The company declared cash dividends of $0.30 per share for three separate periods, totaling $0.90 per share for the nine months ended September 30, 2025, amounting to $12,079,097[127]. - The company established a dividend reinvestment plan (DRIP) on September 3, 2025, allowing shareholders to reinvest cash dividends in additional shares[164]. - The company intends to distribute at least 90% of its REIT taxable income annually to shareholders, with potential tax implications for undistributed income[181]. Financial Performance - Distributable earnings for the three months ended September 30, 2025, were $4,121,401, translating to $0.31 per basic weighted average share[137]. - Net income allocable to common shareholders for the three months ended September 30, 2025, was approximately $4.1 million, or $0.30 per basic common share, compared to $1.7 million, or $0.26 per share for the same period in 2024[139]. - For the three months ended September 30, 2025, interest income increased by approximately $4.3 million, or 132.7%, compared to the same period in 2024, driven by an expansion of the loan portfolio from six to thirteen loans[140]. - Net interest income for the three months ended September 30, 2025, was approximately $6.1 million, compared to $3.2 million for the same period in 2024, reflecting a significant increase[139]. - Total expenses for the three months ended September 30, 2025, were approximately $2.2 million, up from $1.5 million in the same period in 2024, primarily due to increased management and administrative fees[139]. Loan Portfolio and Investments - The company focuses on originating and investing in secured commercial real estate loans, targeting investments across various asset classes[122]. - As of September 30, 2025, the total loan portfolio included thirteen loans held at carrying value, with an aggregate originated commitment of approximately $367.0 million[150]. - The company funded approximately $163.1 million of new loans and additional principal on existing loans during the nine months ended September 30, 2025[150]. - The company committed a total of $30.0 million for a senior bridge loan to refinance a retail property in Houston, Texas, with a maturity date in October 2028[129]. - In September 2025, the company and affiliated co-investors purchased a $60.0 million senior first mortgage loan for a residential property in Miami, Florida, with a cash rate of SOFR plus 4.75%[125]. - The senior loan for the residential property in Sarasota, Florida, was repaid in full, with an outstanding principal of approximately $25.5 million at the time of repayment[126]. - The company entered into two senior secured mortgage loans in October 2025, with an aggregate commitment of $36.6 million for industrial properties in Florida[128]. Capital Structure and Financing - The company aims for a leverage ratio of 1.5:1 debt-to-equity, with a target capitalization of one-third equity, one-third secured debt, and one-third unsecured debt[123]. - The company had $67.2 million outstanding borrowings under the Revolving Credit Facility as of September 30, 2025, with $72.8 million available for borrowing[168]. - The company intends to raise future equity capital and issue debt securities to fund future investments in loans[165]. - The company completed a public offering of 6,400,000 shares in January 2025, generating net proceeds of approximately $71.3 million[162]. Cash Flow and Liquidity - Net cash used in operating activities for the nine months ended September 30, 2025, was approximately $(1.9) million, a decrease of approximately $(4.6) million compared to the same period in 2024[174]. - Net cash used in investing activities was approximately $(105.6) million for the nine months ended September 30, 2025, compared to $(93.9) million in 2024, reflecting an increase in loan issuances[175]. - Net cash used in financing activities was approximately $(71.6) million for the nine months ended September 30, 2025, a decrease of approximately $(201.7) million compared to the same period in 2024[176]. - As of September 30, 2025, the company had unrestricted cash totaling approximately $5.5 million, down from $184.6 million as of December 31, 2024[159]. Risk and Credit Quality - The company is subject to credit risk associated with its loan portfolio, which includes commercial real estate loans[198]. - The provision for current expected credit losses decreased by $0.1 million for the three months ended September 30, 2025, compared to the same period in 2024, while the reserve balance as of September 30, 2025, was approximately $0.4 million, or 0.17% of total loans[146]. - Approximately 96% of loans held at carrying value had floating interest rates as of September 30, 2025, with benchmark rates including one-month SOFR at 4.1%[150]. - A hypothetical 100 basis points increase in the floating benchmark rate would result in an increase in annual interest income of approximately $2.4 million[194]. - The top three borrowers represented approximately 42.0% of the aggregate outstanding principal balances and approximately 41.0% of total loan commitments as of September 30, 2025[202]. - The company has not guaranteed any obligations of unconsolidated entities or entered into any commitment to provide additional funding to such entities[180]. Investment Strategy - The company’s investment mix includes high-quality residential, retail, office, hospitality, and industrial real estate, with capital allocation depending on prevailing market conditions[185]. - The company’s loans are typically valued using a yield analysis, which may fluctuate due to changes in market yields and recovery rates[189]. - The company may be required to fund distributions from working capital or through equity or debt financings if cash available for distribution is less than required[182]. - As of September 30, 2025, total unfunded commitments amounted to $114,065,360, with $96,104,586 due in less than 1-3 years and $17,960,774 due in 3-5 years[178].