Nov 7, 2025 8:07 AM Eastern Standard Time Trinity Place Holdings Inc. Reports Third Quarter Financial Results Share NEW YORK--(BUSINESS WIRE)--Trinity Place Holdings Inc. (OTC PINK: TPHS) (the "Company," "we," "our," or "us") today announced operating results for the third quarter ended September 30, 2025. The Company is an intellectual property holding, investment, and commercialization company. We own and control a portfolio of intellectual property assets focused on the consumer sector, a legacy of our p ...

Financial Condition and Performance - The company has not generated an operating profit and has had negative cash flow from operations since its formation[49]. - The company has incurred substantial indebtedness, increasing the risk of default and affecting its financial condition[70]. - Political and economic uncertainties, including potential outbreaks of contagious diseases, could adversely affect the company's operations and financial condition[57]. - The company may not be able to maintain certain tax benefits if it fails to comply with requirements set by the NYC Department of Housing Preservation and Development[89]. - The company is exposed to environmental compliance costs, which could significantly impact cash flow and operational results[91]. Capital and Financing - The company relies on external sources of capital, including equity and debt financing, to fund ongoing operations and may face challenges in raising additional capital on favorable terms[48]. - The company has the ability to raise additional capital through public or private offerings, which may impact the trading price of its stock[103]. - The company may issue additional equity securities, which could dilute current stockholders' ownership percentages[103]. Joint Ventures and Investments - TPHGreenwich, in which the company holds a 95% interest, may not provide any distributions if the joint venture investor does not receive full repayment of its initial distribution amount[51]. - TPHGreenwich's business plan heavily depends on the successful completion and sale of condominiums at 77 Greenwich, which is its largest asset[73]. - The company faces risks associated with TPHGreenwich's investments in leased commercial and residential real estate, including tenant lease renewals and market competition[52]. - TPHGreenwich may incur real estate impairment charges if market conditions deteriorate, affecting financial results[76]. Market Conditions and Risks - The New York City luxury residential condominium market is currently experiencing a historically high number of unsold units, leading to demand and pricing pressures[74]. - The company faces risks related to potential increases in construction costs due to rising interest rates and supply chain disruptions, which could impact profitability[78]. - The Rent Guidelines Board approved a 2.75% increase for 12-month lease renewals and a 5.25% increase for 24-month lease renewals in 2024, impacting rental income potential[87]. - The company may face challenges in leasing vacant spaces or renewing leases at favorable rates, which could adversely affect cash flows and property values[77]. Stock and Ownership Structure - As of December 31, 2024, there were 65,314,726 shares of common stock outstanding, with a total authorization of 120,000,000 shares[102]. - More than 60% of the common stock is controlled by three stockholders, including approximately 40% owned by Steel Purchaser since February 18, 2025[109]. - The company has never paid dividends on its common stock and does not expect to do so in the foreseeable future[113]. - The company filed a Form 15 with the SEC on February 18, 2025, terminating its registration under the Exchange Act, thus suspending its reporting obligations[101]. - The company is eligible to deregister its common stock due to having fewer than 300 stockholders of record as of February 18, 2025[101]. - The concentration of ownership may deter unsolicited takeovers, potentially affecting stockholder interests[109]. - The company has certain transfer restrictions in its certificate of incorporation to protect its net operating losses (NOLs) and tax attributes[111]. - The company’s common stock is now traded on the OTC markets, affecting its classification under the FIRPTA Rules[120]. Operational Challenges - Breaches of information technology systems could result in significant financial and reputational harm to the company[59]. - TPHGreenwich's ability to develop properties is contingent on obtaining necessary permits and approvals, which may not be secured in a timely manner[90].

Financial Transactions - On February 14, 2024, the company completed a recapitalization transaction, selling 25,112,245 shares of common stock at $0.30 per share, resulting in a total investment of approximately $7.5 million [125]. - The maturity date for the mortgage and mezzanine loans associated with the 77 Greenwich property has been extended to October 23, 2025, with an option for an additional year [126]. - The annual management fee for the TPH Manager is set at the greater of $400,000 or 1.25% of the outstanding principal balance of the Corporate Credit Facility and the 77G Mezzanine Loan [133]. - The company has engaged advisors to assist in identifying and evaluating potential strategic transactions [140]. - The company has entered into a letter of intent with a third party for a potential strategic transaction, though there is no assurance of successful completion [142]. Financial Performance - There were no rental revenues for the three months ended September 30, 2024, compared to $1.5 million for the same period in 2023 [157]. - Other income increased to $397,000 for the three months ended September 30, 2024, from $29,000 in the same period in 2023 [158]. - The company reported no sales of residential condominium units at 77 Greenwich for the three months ended September 30, 2024, compared to $9.2 million for the same period in 2023 [159]. - Property operating expenses decreased to $17,000 for the three months ended September 30, 2024, from $786,000 in the same period in 2023 [160]. - General and administrative expenses decreased to $1.3 million for the three months ended September 30, 2024, from $1.5 million in the same period in 2023 [162]. - There was no cost of sales for residential condominium units at 77 Greenwich for the three months ended September 30, 2024, compared to $9.8 million for the same period in 2023 [165]. - Net loss attributable to common stockholders decreased approximately $10.8 million to $1.1 million for the three months ended September 30, 2024, compared to $11.9 million for the same period in 2023 [170]. - Rental revenues decreased by approximately $3.6 million to $798,000 for the nine months ended September 30, 2024, from $4.4 million for the same period in 2023 [171]. - Other income increased by approximately $717,000 to $890,000 for the nine months ended September 30, 2024, from $173,000 for the same period in 2023 [172]. - Sales of residential condominium units at 77 Greenwich decreased by approximately $26.1 million to $1.4 million for the nine months ended September 30, 2024, from $27.5 million for the same period in 2023 [173]. - Property operating expenses decreased by approximately $2.4 million to $454,000 for the nine months ended September 30, 2024, from $2.9 million for the same period in 2023 [174]. - Net income attributable to common stockholders increased by approximately $35.1 million to $6.1 million for the nine months ended September 30, 2024, from a net loss of $29.0 million for the same period in 2023 [188]. - Interest expense, net decreased by approximately $17.5 million to $3.9 million for the nine months ended September 30, 2024, from $21.4 million for the same period in 2023 [185]. Cash Flow and Liquidity - Cash used in operating activities increased by approximately $6.1 million to $7.1 million for the nine months ended September 30, 2024, compared to $1.0 million for the same period in 2023 [193]. - Cash used in investing activities increased by approximately $14.0 million to $6.9 million for the nine months ended September 30, 2024, compared to net cash provided by investing activities of $7.1 million for the same period in 2023 [194]. - Net cash provided by financing activities increased by approximately $26.0 million to $6.9 million for the nine months ended September 30, 2024, compared to net cash used in financing activities of $19.1 million for the same period in 2023 [195]. - The company has limited unrestricted cash and liquidity, raising concerns about its ability to fund operations beyond the next few months without additional capital or strategic transactions [139]. Tax and Regulatory Matters - The company retains approximately $700 million in federal net operating loss carryforwards (NOLs) and various state and local NOLs, which can be utilized to reduce future taxable income [139]. - U.S. federal net operating losses (NOLs) as of September 30, 2024, were approximately $350.7 million, with state NOLs and other tax loss carryforwards at approximately $331.9 million [196]. - A valuation allowance of $88.1 million was recorded as of September 30, 2024, indicating that it is more likely than not that the entire deferred tax assets will not be realized [198]. - The company has utilized approximately $20.1 million of federal NOLs since 2009 through September 30, 2024 [197]. - The company intends to extend a provision in its certificate of incorporation that helps preserve certain tax benefits associated with its NOLs, which is set to expire on February 12, 2025 [201]. Strategic Considerations - The company is exploring strategic alternatives, including potential equity or debt financing, refinancing existing debt, and possible mergers or acquisitions [140]. - The company is exploring options for the potential sale of the Paramus property [148]. - The company has significant reliance on external sources of capital to fund operations, raising substantial doubt about its ability to continue as a going concern [202]. - The company is eligible to terminate the registration of its common stock under the Exchange Act, which may occur in the near future [204]. - The company faces risks related to stock price volatility and potential dilution from future issuances of common stock or convertible securities [209]. - The company has not generated an operating profit, creating challenges in evaluating its business plan and long-term viability [204]. - The company is subject to risks associated with TPHGreenwich, including potential distributions and leverage risks that could adversely affect financial condition [204]. Market and Trading Status - The company was delisted from the NYSE American on August 19, 2024, and currently trades on the OTC Markets under the symbol "TPHS" [143].

Group 1 - TPHS stock is experiencing a significant increase of 17% as of Friday morning, driven by heavy trading activity [4][7] - The trading volume for TPHS stock has reached over 14.6 million shares, which is substantially higher than its daily average of approximately 6.6 million shares [3] - TPHS is classified as a penny stock, with a prior closing price of just 13 cents and a market capitalization of $8.211 million [8] Group 2 - There is no clear news or analyst coverage explaining the rally in TPHS stock, indicating a lack of fundamental drivers for the price movement [1][9] - The nature of penny stocks, including TPHS, often leads to extreme volatility due to speculative trading practices [2][10] - The company's float is reported to be 22.11 million units, which may contribute to the stock's volatility [3]

Financial Transactions - On February 14, 2024, the company completed a recapitalization transaction, selling 25,112,245 shares of common stock at $0.30 per share, resulting in a total capital raise of approximately $7.5 million[116]. - The maturity date for the mortgage and mezzanine loans related to the 77 Greenwich property has been extended to October 23, 2025, with an option for an additional year, while the Corporate Credit Facility maturity has been extended to June 30, 2026[117]. - The annual management fee for the TPH Manager is set at the greater of $400,000 or 1.25% of the outstanding principal balance of the Corporate Credit Facility and the 77G Mezzanine Loan[124]. - The company is exploring strategic alternatives to maximize shareholder value, including potential equity or debt financing, refinancing existing debt, or a sale or merger[131]. - The company has engaged Houlihan Lokey and Ackman-Ziff as advisors to assist in the strategic review process[131]. - The recapitalization transactions have simplified the company's structure, making it more attractive for new investors[118]. Real Estate and Property Management - The company now owns a 95% equity interest in TPHGreenwich, which holds real estate assets valued at over $600 million[131]. - The company has a 95% ownership stake in TPHGreenwich, which manages properties including a mixed-use project at 77 Greenwich Street and a multi-family property at 237 11th Street[116]. - The Paramus property consists of approximately 77,000 total square feet of rentable space, leased to Restoration Hardware Holdings, Inc., with a license agreement scheduled to end on March 31, 2025[135]. - As of March 31, 2024, TPHGreenwich had closed on the sale of 39 residential condominium units at 77 Greenwich, with 50 remaining units to sell as of May 14, 2024[1]. - TPHGreenwich closed on one residential condominium unit during the three months ended March 31, 2024, compared to five units in the same period in 2023[144]. Financial Performance - Total rental revenues decreased by approximately $713,000 to $798,000 for the three months ended March 31, 2024, compared to $1.5 million for the same period in 2023[142]. - Sales of residential condominium units at 77 Greenwich decreased by approximately $11.7 million to $1.4 million for the three months ended March 31, 2024, from $13.1 million for the same period in 2023[144]. - Property operating expenses decreased by approximately $852,000 to $415,000 for the three months ended March 31, 2024, from $1.3 million for the same period in 2023[145]. - Real estate tax expense decreased by approximately $98,000 to $365,000 for the three months ended March 31, 2024, from $463,000 for the same period in 2023[146]. - General and administrative expenses decreased by approximately $338,000 to $1.1 million for the three months ended March 31, 2024, from $1.4 million for the same period in 2023[147]. - Cost of sales for residential condominium units decreased by approximately $10.9 million to $1.4 million for the three months ended March 31, 2024, from $12.3 million for the same period in 2023[150]. - Net income attributable to common stockholders increased by approximately $14.3 million to $8.1 million for the three months ended March 31, 2024, from a loss of $6.2 million for the same period in 2023[158]. Cash Flow and Operating Activities - Total cash and restricted cash as of March 31, 2024, was $4.0 million, with approximately $285,000 in cash and cash equivalents[159]. - Net cash used in operating activities increased by approximately $8.5 million to $4.4 million for the three months ended March 31, 2024, from net cash provided by operating activities of $4.1 million for the same period in 2023[162]. - Net cash provided by financing activities increased by approximately $21.6 million to $7.0 million for the three months ended March 31, 2024, compared to net cash used in financing activities of $14.6 million for the same period in 2023[164]. Tax and Valuation - The company retains approximately $329.3 million in federal net operating loss carryforwards and $341.3 million in state and local net operating losses, which can be utilized to offset future taxable income[115]. - U.S. federal net operating losses (NOLs) as of March 31, 2024, were approximately $162.8 million, with total tax loss carryforwards of approximately $329.3 million[166]. - A valuation allowance of $87.6 million was recorded as of March 31, 2024, indicating that it is more likely than not that the entire deferred tax assets will not be realized[168]. Reporting and Compliance - The company filed its 2023 Annual Report with the SEC on March 29, 2024, and amended it on April 29, 2024, highlighting potential risks that could affect future performance[176]. - As a smaller reporting company, the company is not required to provide detailed market risk disclosures[177].

Financial Condition and Performance - The company has approximately $316.6 million in federal net operating losses (NOLs) and $267.4 million in state NOLs as of December 31, 2023[62]. - The company has not generated an operating profit and has had negative cash flow from operations, making its long-term viability uncertain[48]. - The company has incurred substantial indebtedness, increasing the risk of default and affecting financial condition and results of operations[77]. - TPHGreenwich reported a stockholders' deficit of $(1.2) million as of September 30, 2023, and has incurred losses from continuing operations in three of the last four fiscal years[112]. - The company is required to maintain stockholders' equity of at least $2.0 million to comply with NYSE American listing standards, which it currently does not meet[112]. - The company may face delisting if it fails to demonstrate sustained price improvement or compliance with the NYSE American standards by July 4, 2024[113]. - The company has not paid dividends on its common stock in the past and does not expect to pay dividends for the foreseeable future[128]. Revenue Sources and Risks - The company relies on asset management fees as its primary source of revenue following the Recapitalization Transactions, which could be adversely affected if the Asset Management Agreement is terminated[55]. - The company’s ability to raise additional capital on favorable terms is uncertain, which could impact its operations and growth[47]. - TPHGreenwich's investment returns from 77 Greenwich may be less than anticipated due to potential price reductions in condominium sales[88]. - The company faces risks related to increased construction costs, which may exceed original estimates due to rising interest rates and supply chain disruptions[93]. - Political and economic uncertainties, including taxation and interest rate increases, could negatively affect the company's tenants and overall business[66]. Joint Ventures and Investments - The company owns a 95% interest in TPHGreenwich, but distributions may not be received if the joint venture investor does not receive full repayment of its initial distribution amount[53]. - The company faces risks associated with joint venture investments, including potential bankruptcy of partners and management control issues[53]. - TPHGreenwich's ability to develop properties is contingent on obtaining necessary permits and approvals, which may not be secured in a timely manner[103]. Market Conditions and Regulatory Environment - The New York City residential condominium market is experiencing a historically high number of unsold units, leading to demand and pricing pressures[86]. - TPHGreenwich's properties are subject to rent stabilization regulations, limiting the ability to raise rents above specified maximum amounts[96]. - In 2023, the Rent Guidelines Board approved a 3.00% increase on 12-month lease renewals and a 2.75% increase for the first year of 24-month lease renewals[98]. - TPHGreenwich may not receive certain tax benefits if it fails to comply with requirements set by the NYC Department of Housing Preservation and Development[100]. Corporate Governance and Ownership Structure - More than 60% of the company's common stock is controlled by three stockholders, with over 40% owned by the Company Investor following Recapitalization Transactions[125]. - The company has a classified board of directors with two-year staggered terms, which may affect control dynamics[136]. - The company has issued a class of special stock that allows Third Avenue to appoint one director to the board, influencing management decisions[126]. - The concentration of stock ownership may deter unsolicited takeovers, potentially impacting stockholder value[125]. Compliance and Legal Considerations - The company is subject to extensive covenants under the Stock Purchase Agreement, and breaches could adversely impact its financial condition[56]. - The exclusive forum provision in the company's certificate of incorporation may discourage stockholder claims and increase litigation costs[132]. - The company has registered a significant amount of restricted shares for resale, which could impact the market price of its common stock[124]. - The company's certificate of incorporation includes transfer restrictions to protect its ability to utilize NOLs and certain tax attributes, potentially limiting liquidity[127]. - The company is classified as a U.S. real property holding corporation (USRPHC), which may subject non-U.S. holders to U.S. federal income tax on gains from the sale of its common stock[134]. Key Personnel and Management - The loss of key personnel, particularly the CEO, could have a material adverse effect on the company's operations and financial condition[61]. - TPHGreenwich's business plan focuses on the completion and sale of condominiums at 77 Greenwich, which is its largest asset[85]. - TPHGreenwich's common stock is thinly traded, leading to significant price fluctuations that may impair the ability to raise equity capital[109]. - The NYSE American has granted TPHGreenwich a compliance plan with a cure period until May 29, 2025, to regain compliance with listing standards[114]. - Future capital raising efforts may dilute current stockholders' ownership percentages and could decrease the fair market value of equity securities[120].

Financial Position - As of September 30, 2023, the company had total cash and restricted cash of $9.0 million, with approximately $809,000 in cash and cash equivalents and $8.2 million in restricted cash[144]. - As of October 31, 2023, cash and cash equivalents totaled approximately $583,000, raising concerns about the ability to fund operations beyond a few months[198]. - The secured line of credit had an outstanding balance of $11.75 million as of September 30, 2023, with an interest rate reduced to 2.5%[233]. - As of September 30, 2023, total cash and restricted cash amounted to $9.0 million, with approximately $809,000 in cash and cash equivalents and $8.2 million in restricted cash[197]. Sales and Revenue - The company closed on the sale of 10 residential condominium units since December 31, 2022, totaling 38 units sold as of September 30, 2023, with three units sold in Q3 2023[150]. - Sales of residential condominium units at 77 Greenwich decreased by approximately $8.3 million to $9.2 million for the three months ended September 30, 2023, from $17.5 million for the same period in 2022[164]. - Total rental revenues decreased by approximately $17,000 to $1.5 million for the three months ended September 30, 2023, compared to the same period in 2022[162]. - Rental revenues increased by approximately $428,000 to $4.4 million for the nine months ended September 30, 2023, compared to $4.0 million for the same period in 2022[177]. - Other income increased by approximately $127,000 to $173,000 for the nine months ended September 30, 2023, from $46,000 for the same period in 2022[178]. Expenses and Losses - Net loss attributable to common stockholders increased by approximately $5.5 million to $11.9 million for the three months ended September 30, 2023, from $6.4 million for the same period in 2022[176]. - Net loss attributable to common stockholders increased by approximately $17.3 million to $29.0 million for the nine months ended September 30, 2023, compared to $11.7 million for the same period in 2022[192]. - General and administrative expenses increased by approximately $354,000 to $4.8 million for the nine months ended September 30, 2023, compared to $4.4 million for the same period in 2022[182]. - Real estate tax expense increased by approximately $290,000 to $1.6 million for the nine months ended September 30, 2023, from $1.3 million for the same period in 2022[181]. - Interest expense, net increased by approximately $4.4 million to $7.9 million for the three months ended September 30, 2023, from $3.5 million for the same period in 2022[174]. - Interest expense, net increased by approximately $11.8 million to $21.4 million for the nine months ended September 30, 2023, from $9.6 million for the same period in 2022[189]. Debt and Financing - The company is exploring strategic alternatives, including potential equity and/or debt financing, refinancing existing debt, and possible sale or merger transactions[145]. - The company has entered into forbearance agreements with lenders, extending the period for certain defaults until December 31, 2023, unless terminated earlier[147]. - The Corporate Credit Facility has a total commitment of $70.0 million, with a maturity date of December 19, 2024, subject to extensions[205]. - As of September 30, 2023, the outstanding balance of the CCF was $40.75 million, with accrued interest totaling approximately $9.1 million[215]. - The 77 Mortgage Loan had a total amount borrowed of $133.1 million, with $30.6 million drawn by September 30, 2023, leaving $3.0 million undrawn[217]. - The 77 Mortgage Loan's all-in interest rate was 12.05% as of September 30, 2023[218]. - The Company entered into a forbearance agreement in August 2023, allowing for the deferral of a $7.0 million repayment and cash interest payments until August 31, 2023[211]. - The Mezzanine Loan was originally $7.5 million, with a blended interest rate of 12.05% as of September 30, 2023[223]. - The Company has paid down approximately $69.9 million of the 77 Mortgage Loan from closed sales of residential condominium units, reducing the balance to $100.5 million[222]. - The CCF was fully drawn as of September 30, 2023[216]. - The Company is required to enter into a Strategic Transaction or repay the CCF by $5.0 million from equity proceeds by the end of the Restricted Period[210]. - As of September 30, 2023, the Mezzanine Loan balance was $30.3 million with accrued interest of approximately $9.8 million[228]. - The 237 11th Senior Loan had an outstanding balance of $50.0 million and the Mezz Loan had an outstanding balance of $10.0 million, with a blended interest rate of 5.35% per annum[231]. Operational Challenges and Risks - The company is currently in default of covenants under the 77 Mortgage Loan, Mezzanine Loan, and Corporate Credit Facility, with forbearance agreements expiring on December 31, 2023[244]. - The company faces risks related to obtaining additional financing and refinancing existing loans on favorable terms[246]. - There are concerns regarding the adverse trends in the New York City residential condominium market[246]. - The company may encounter higher-than-anticipated costs in property development, affecting investment returns[246]. - Risks associated with the ability to enter into new leases and renew existing leases with tenants at commercial and residential properties[246]. - The company is subject to competition for new acquisitions and investments in real estate[246]. - There are potential risks related to joint ventures and acquisitions in owned and leased real estate[246]. - The company may face challenges in maintaining state tax benefits for certain properties[246]. - Compliance costs with environmental laws and regulations may impact financial performance[246]. - The company is exposed to risks from political and economic uncertainty, including the outbreak of contagious diseases[246]. - Stock price volatility may hinder the company's ability to raise capital in the future[246]. Property and Development - The company has 52 remaining residential condominium units available for sale at 77 Greenwich as of September 30, 2023[152]. - The Paramus property is leased at 94.8% occupancy, while the 237 11th Street property has a leasing rate of 97.1% as of September 30, 2023[152]. - The company has received $46.4 million from the New York City School Construction Authority for the sale of a condominium unit and construction supervision fees as of September 30, 2023[152]. - The company anticipates that the pace of signing and closing contracts on residential condominium units will normalize to historical trends, although predictions remain uncertain[151].

Financial Position - As of June 30, 2023, the company had total cash and restricted cash of $15.4 million, with $4.4 million in cash and cash equivalents and $11.0 million in restricted cash[135]. - The Corporate Credit Facility (CCF) had an outstanding balance of $38.75 million as of June 30, 2023, with an effective interest rate of 10.325%[195]. - The 77 Mortgage Loan has a balance of $106.0 million as of June 30, 2023, after being paid down by approximately $62.1 million from closed sales of residential condominium units[202]. - The Mezzanine Loan had a balance of $30.3 million and accrued interest of approximately $8.4 million as of June 30, 2023[207]. - The 237 11th Senior Loan and Mezz Loan had outstanding balances of $50.0 million and $10.0 million, respectively, with a blended interest rate of 5.35% as of June 30, 2023[211]. - U.S. federal net operating losses (NOLs) were approximately $293.4 million as of June 30, 2023, an increase from $162.8 million at the emergence date of the Syms bankruptcy[219]. - A valuation allowance of $83.9 million was recorded for deferred tax assets as of June 30, 2023, indicating that realization by future taxable income is unlikely[220]. Sales and Revenue - The company has closed on the sale of 35 residential condominium units at 77 Greenwich as of June 30, 2023, with 55 units remaining for sale[137]. - The company received $41.5 million from the New York City School Construction Authority for the sale of a condominium unit and has received $55.4 million in reimbursable construction costs through June 30, 2023[138]. - Sales of residential condominium units at 77 Greenwich increased by approximately $106,000 to $5.2 million for the three months ended June 30, 2023, from $5.1 million for the same period in 2022[148]. - Sales of residential condominium units at 77 Greenwich increased by approximately $7.1 million to $18.3 million for the six months ended June 30, 2023, from $11.2 million for the same period in 2022[166]. - Total rental revenues increased by approximately $194,000 to $1.4 million for the three months ended June 30, 2023, compared to $1.2 million for the same period in 2022[146]. - Total rental revenues increased by approximately $445,000 to $2.9 million for the six months ended June 30, 2023, compared to $2.5 million for the same period in 2022[164]. Expenses and Losses - Property operating expenses increased by approximately $45,000 to $811,000 for the three months ended June 30, 2023, compared to $766,000 for the same period in 2022[149]. - General and administrative expenses increased by approximately $332,000 to $1.8 million for the three months ended June 30, 2023, from $1.5 million for the same period in 2022[152]. - Net loss attributable to common stockholders increased by approximately $10.7 million to $10.9 million for the three months ended June 30, 2023, from $223,000 for the same period in 2022[163]. - Property operating expenses increased by approximately $508,000 to $2.1 million for the six months ended June 30, 2023, compared to $1.6 million for the same period in 2022[167]. - Cost of sales for residential condominium units increased by approximately $7.0 million to $17.5 million for the six months ended June 30, 2023, from $10.5 million for the same period in 2022[172]. - Net loss attributable to common stockholders increased by approximately $11.8 million to $17.2 million for the six months ended June 30, 2023, compared to $5.4 million for the same period in 2022[180]. - Interest expense, net increased by approximately $7.5 million to $13.5 million for the six months ended June 30, 2023, from $6.1 million for the same period in 2022[178]. - Interest expense - amortization of deferred finance costs increased approximately $1.0 million to $1.8 million for the six months ended June 30, 2023, from $814,000 for the same period in 2022[179]. Strategic Alternatives and Risks - The company is exploring strategic alternatives, including asset sales, refinancing, and potential mergers, due to substantial doubt about its ability to continue as a going concern[135]. - The company has engaged advisors to assist in identifying and evaluating potential strategic alternatives for maximizing stockholder value[135]. - The company is evaluating restructuring options, including potential bankruptcy protection or out-of-court restructuring of liabilities[136]. - The company is exploring opportunities to secure additional funding through asset sales, refinancing, and equity or debt financings[185]. - The company extended the maturity dates of secured lines of credit and loans by 12 months to March 2024 and July 2024, respectively[185]. - The company faces risks related to limited cash resources and reliance on external financing to fund operations in the next 12 months[225]. - Risks include potential adverse trends in the New York City residential condominium market and challenges in executing the business plan related to property development[225]. - The company may encounter difficulties in obtaining required permits and approvals for property development, which could impact future projects[229]. - Risks associated with joint ventures and the ability to maintain state tax benefits for certain properties are also present[229]. - The company is subject to various risks, including stock price volatility and potential dilution from future share issuances[229]. Construction and Development - The construction at 77 Greenwich has faced delays, but substantial completion is expected soon, with remaining work primarily on the exterior and roof deck[137]. - The Paramus property has 77,000 square feet of retail space leased at an annualized rent of $516,000, with the lease expiring in March 2024[142]. - The 237 11th Street property has a total of 105 multi-family units, with an occupancy rate of 98.1% as of June 30, 2023[139].

Financial Position - As of March 31, 2023, the company had total cash and restricted cash of $18.8 million, with approximately $2.6 million in cash and cash equivalents and $16.2 million in restricted cash[129]. - The company has approximately $282.9 million of federal net operating loss carryforwards (NOLs) as of March 31, 2023, which can be utilized to reduce future taxable income[128]. - As of March 31, 2023, total cash and restricted cash amounted to $18.8 million, with approximately $2.6 million in cash and cash equivalents and $16.2 million in restricted cash[161]. - U.S. federal net operating losses (NOLs) as of March 31, 2023, were approximately $282.9 million, with a valuation allowance of $80.1 million recorded[193][194]. - The company has utilized approximately $20.1 million of federal NOLs since 2009 through March 31, 2023[193]. Sales and Revenue - The company has closed on the sale of 33 residential condominium units at 77 Greenwich, with 57 units remaining for sale as of March 31, 2023[134]. - Sales of residential condominium units at 77 Greenwich rose by approximately $7.0 million to $13.1 million for the three months ended March 31, 2023, from $6.1 million for the same period in 2022, with five units closed compared to three in the prior year[144]. - Total rental revenues increased by approximately $251,000 to $1.5 million for the three months ended March 31, 2023, compared to $1.3 million for the same period in 2022, driven by higher occupancy and base rents[142]. Expenses and Losses - Property operating expenses increased by approximately $463,000 to $1.3 million for the three months ended March 31, 2023, from $804,000 for the same period in 2022, primarily due to increased legal expenses and less capitalized operating costs[145]. - Interest expense, net increased by approximately $3.5 million to $6.3 million for the three months ended March 31, 2023, from $2.8 million for the same period in 2022, attributed to higher overall interest rates[154]. - Net loss attributable to common stockholders increased by approximately $1.1 million to $6.2 million for the three months ended March 31, 2023, from $5.1 million for the same period in 2022, mainly due to increased net interest expense[157]. Strategic Alternatives and Financing - The company is exploring strategic alternatives, including asset sales, refinancing existing debt, and potential equity or debt financing to secure additional funding[129]. - The company is exploring strategic alternatives, including refinancing existing debt and potential asset sales, to address liquidity concerns and maximize stockholder value[162]. - The company has engaged Houlihan Lokey and Ackman-Ziff as advisors to assist in the strategic review process and evaluate potential alternatives[129]. - The Corporate Credit Facility (CCF) has a total credit limit of $70.0 million, maturing on December 19, 2024, with potential extensions until June 19, 2026[165]. - The Company is required to prepay at least $7.0 million of the CCF by May 1, 2023, and has deferred upcoming cash interest payments until August 31, 2023[167]. - The Company entered into a warrant agreement with the CCF Lender, issuing ten-year warrants to purchase up to 7,179,000 shares at an amended exercise price of $4.31 per share[168]. - The company expects existing capital resources will not be sufficient to fund operations for at least the next 12 months without a strategic transaction or raising additional capital[200]. Property and Construction - The construction at 77 Greenwich has taken longer than projected, with substantial completion expected soon, including the completion of the 42nd floor roof deck and the 12th floor terrace[131]. - The Paramus property consists of approximately 77,000 square feet of rentable space, with a primary building leased to Restoration Hardware Holdings, Inc., scheduled to end on March 31, 2024[137]. - The company has incurred significant cash outflows for repairs and remediation at the 237 11th property due to water damage and other construction defects, with ongoing legal claims to recover costs[137]. Cash Flow Activities - Net cash provided by operating activities increased by approximately $3.7 million to $4.1 million for the three months ended March 31, 2023, compared to $375,000 for the same period in 2022[189]. - Net cash provided by investing activities increased by approximately $7.3 million to $7.2 million for the three months ended March 31, 2023, due to $7.2 million in sale proceeds from the 250 North 10th joint venture property[191]. - Net cash used in financing activities increased by approximately $5.1 million to $14.6 million for the three months ended March 31, 2023, primarily due to a $5.9 million Partner Loan payoff[192]. Debt and Loans - The 77 Mortgage Loan had a balance of $110.0 million as of March 31, 2023, with approximately $58.2 million paid down from proceeds of closed sales of residential condominium units[174]. - The Mezzanine Loan had a balance of $30.3 million as of March 31, 2023, with accrued interest totaling approximately $7.0 million[178]. - The blended interest rate for the 77 Mortgage Loan and the Mezzanine Loan was 10.3% on an annual basis as of March 31, 2023[176]. - The 237 11th Senior Loan and Mezz Loan had outstanding balances of $50.0 million and $10.0 million, respectively, as of March 31, 2023, with a blended interest rate of 5.35% per annum[183]. - The 77 Mortgage Loan has a two-year term with an option to extend for an additional year, subject to certain conditions, and bears interest at a rate of 11.5% as of March 31, 2023[172]. - The 77 Mortgage Loan Agreement was amended in November 2022 to extend the Final Completion date to September 29, 2023, and eliminate the liquidity requirement[172]. - The company is exploring a potential refinancing of the 237 11th Loans, with the lender agreeing in principle to waive the minimum liquidity requirement through the initial maturity date of July 9, 2023[184]. - The secured line of credit with Webster Bank amounts to $11.75 million, with a maturity date extended to March 22, 2024, and an interest rate reduced to 2.5%[185]. Other - The company sold its interest in the 250 North 10th joint venture in February 2023, resulting in net proceeds of approximately $1.2 million and a net gain of approximately $3.1 million[186]. - The company sold no shares of common stock during the three months ended March 31, 2023, or during the year ended December 31, 2022[187]. - The company anticipates that the ATM Program will become available again later in 2023 after a late filing of the Quarterly Report[188]. - General and administrative expenses decreased by approximately $58,000 to $1.4 million for the three months ended March 31, 2023, from $1.5 million for the same period in 2022[147]. - Unrealized gain on warrants increased by approximately $435,000 to $66,000 for the three months ended March 31, 2023, from an unrealized loss of $369,000 for the same period in 2022[153].

Financial Position - As of December 31, 2022, the company had total cash and restricted cash of $22.1 million, with approximately $1.5 million in cash and cash equivalents and $20.5 million in restricted cash[18]. - The company has $2.0 million available under its secured line of credit as of December 31, 2022, which has since been drawn[18]. - The company has limited cash resources and generates minimal revenues from operations, relying on external capital sources to fund ongoing operations[40]. - The company has not generated an operating profit and has had negative cash flow from operations since its formation, raising concerns about its long-term viability[42]. - The company has incurred substantial indebtedness at both the parent and subsidiary levels, increasing the risk of default and adverse effects on financial condition and operations[43]. - Several loans have near-term maturities, and the cost of required interest rate cap agreements has become material due to rising interest rates, potentially impacting financial condition[44]. - All properties secure loans, and failure to make scheduled repayments could lead to adverse impacts on financial condition and cash flows[45]. Strategic Initiatives - The company is exploring opportunities to secure additional funding through asset sales, refinancing, and equity or debt financings, creating substantial doubt about its ability to continue as a going concern[18]. - The company has engaged Houlihan Lokey and Ackman-Ziff as advisors to assist in identifying and evaluating potential strategic alternatives, including equity and/or debt financing, refinancing existing debt, or a sale or merger of the company[18]. - The company is focused on maximizing stockholder value through various strategies, including identifying acquisition opportunities and enhancing its capital structure[22]. - The company may evaluate strategic transactions, which could disrupt business and consume financial resources, with risks of not realizing anticipated benefits[51]. Real Estate Development - The company has signed and closed contracts for five residential condominium units at 77 Greenwich since December 31, 2022, despite construction delays due to COVID-19 and supply-chain issues[20]. - The substantial majority of construction at 77 Greenwich is completed, with amenity spaces and punch-list items expected to be finished by April 30, 2023[21]. - The business plan heavily relies on the completion and sale of condominiums at 77 Greenwich, which is currently the largest asset[49]. - 77 Greenwich consists of 90 luxury residential condominium apartments, and the New York City market is experiencing high unsold unit levels, leading to pricing pressures[50]. Market and Regulatory Risks - Rent stabilization regulations may limit the ability to raise rents at multi-family residential properties, adversely affecting revenue potential[64]. - The Rent Guidelines Board approved a 3.25% increase on 12-month lease renewals and a 5.0% increase on 24-month lease renewals in 2022[66]. - Proposed legislation in New York State may impose further restrictions on rent increases, potentially impacting revenue growth[68]. - The company faces competition for acquisition and investment opportunities from well-capitalized real estate investors, which may increase acquisition costs and adversely affect growth[69]. - Investment returns from 77 Greenwich and other properties may be less than anticipated due to various risks, including increased costs and market conditions[53]. - Political and economic uncertainty, including potential outbreaks of contagious diseases, could adversely affect the company's tenants and overall business[88]. Environmental and Compliance Risks - The company may incur significant costs to comply with environmental laws, which could impair the ability to lease or sell real estate[82]. - The company is subject to various regulatory requirements, including the Americans with Disabilities Act (ADA), which could result in substantial costs if compliance is not maintained[84]. - The company may face risks associated with environmental contamination, which could lead to significant costs and impair the ability to sell or lease properties[82]. - The company may not be able to maintain certain tax benefits related to properties if compliance with NYC Department of Housing Preservation and Development requirements is not met[77]. Stockholder and Market Considerations - The common stock is thinly traded, leading to significant price fluctuations even with small trades[94]. - As of December 31, 2022, there were 36,907,862 shares of common stock outstanding and 7,179,000 warrants to purchase additional shares[97]. - The company is authorized to issue up to 120,000,000 shares of capital stock, which may dilute existing stockholders' ownership interests[97]. - The concentration of ownership, with over 50% of shares controlled by four stockholders, may influence corporate decisions and deter unsolicited takeovers[102]. - The company has not paid dividends on its common stock in the past and does not expect to do so in the foreseeable future[107]. - Future capital-raising transactions may result in downward pressure on the trading price of the common stock[100]. - The company may issue additional equity securities, which could dilute current stockholders' ownership percentages[98]. - The market price of the common stock could decline due to sales by significant stockholders or market perceptions of such sales[101]. - The company is classified as a U.S. real property holding corporation, which may subject non-U.S. investors to U.S. federal income tax on gains from the sale of common stock[113]. - The exclusive forum provision in the company's charter may discourage stockholders from bringing claims in a preferred judicial forum[111]. Joint Ventures and Financial Instruments - The company formed a joint venture to acquire and operate the 250 North 10th property in Brooklyn, New York, which may involve risks such as decision impasses and partner bankruptcy[74]. - The transition from LIBOR to SOFR may impact the company's financial results, with the 237 11th Loan converted from LIBOR to SOFR in 2023[76].