American Strategic Investment (NYC) - 2024 Q3 - Quarterly Report

Property and Occupancy - As of September 30, 2024, the company owned seven properties with a total of 1.2 million rentable square feet, acquired for an aggregate purchase price of $783.5 million, and an overall occupancy rate of 85.8%[160] - The overall portfolio occupancy improved to 85.8% as of September 30, 2024, up from 85.1% as of September 30, 2023[176] - New leases signed during the nine months ended September 30, 2024, contributed to occupancy improvements at key properties, including 9 Times Square (70.6%) and 1140 Avenue of the Americas (79.3%)[176][177] - Occupancy at 400 E. 67th Street/200 Riverside Blvd decreased to 94.2% as of September 30, 2024, compared to 100% for the same period in 2023[178] - Occupancy across the portfolio decreased to 85.8% as of September 30, 2024, down from 86.7% as of December 31, 2023[248] - Occupancy at 123 William Street decreased to 89.3% as of September 30, 2024, down from 91.4% as of December 31, 2023[249] - Occupancy at 1140 Avenue of the Americas increased to 79.3% as of September 30, 2024, compared to 77.1% as of December 31, 2023[249] - Occupancy at 400 E. 67th Street/200 Riverside Blvd. decreased to 94.2% as of September 30, 2024, from 100% as of December 31, 2023[249] - As of September 30, 2024, approximately 82% of leases contain rent escalation provisions, averaging a cumulative increase of 2.1% per year[266] Financial Performance - Revenue from tenants decreased to$ 15.4 million for the quarter ended September 30, 2024, down from $16.0 million in the same quarter of 2023, representing a decrease of approximately 3.5%[184] - Net loss attributable to common stockholders was$ 34.5 million for the quarter ended September 30, 2024, compared to $9.4 million for the same quarter in 2023, indicating an increase in net loss of approximately 267%[182] - Total operating expenses increased significantly to$ 44.7 million for the quarter ended September 30, 2024, compared to $20.7 million for the same quarter in 2023, reflecting an increase of approximately 116%[183] - Impairment charges for real estate investments totaled$ 27.8 million for the quarter ended September 30, 2024, compared to $0.4 million for the same quarter in 2023, marking a substantial increase of approximately 6,850%[189] - Interest expense rose to$ 5.3 million for the quarter ended September 30, 2024, compared to $4.7 million for the same quarter in 2023, an increase of approximately 12%[197] - Net loss attributable to common stockholders for the nine months ended September 30, 2024, was$ 133.9 million, compared to $32.0 million for the same period in 2023, reflecting an increase of approximately 318%[201] - Revenue from tenants for the nine months ended September 30, 2024, was$ 46.7 million, down from $47.3 million for the same period in 2023, a decrease of approximately 1.4%[201] - Total operating expenses for the nine months ended September 30, 2024, increased to$ 165.5 million from $65.3 million for the same period in 2023, an increase of approximately 153%[201] Debt and Financing - Two mortgages totaling$ 109.0 million remained in cash trap events as of September 30, 2024, limiting the use of excess cash flows from those properties[167] - The company has breached debt service coverage provisions under the non-recourse mortgage for 1140 Avenue of the Americas for 17 consecutive quarters, with a principal amount of $99.0 million[231] - A lease sweep period was triggered for the 400 E. 67th Street/200 Riverside Blvd. property due to a near-maturity lease, with a principal amount of$ 50.0 million[235] - The company's net debt was $394.3 million with a gross asset value of$ 655.8 million, resulting in a leverage ratio of 60.1% as of September 30, 2024[226] - The company’s gross borrowings totaled $399.5 million with a weighted-average interest rate of 4.90% and a weighted-average maturity of 2.5 years[227] Corporate Actions - The company terminated its REIT election effective January 1, 2023, to expand its investment strategy beyond qualifying REIT income[161] - A reverse stock split of 1-for-8 was executed on January 11, 2023, converting each outstanding share of Class A common stock into 0.125 shares[162] - The company raised gross proceeds of$ 5.0 million through a non-transferable rights offering completed on February 22, 2023[163] - The company entered into a definitive purchase and sale agreement to sell the 9 Times Square property for a contract sales price of $63.5 million, expected to be consummated no later than January 2025[199] - The company has executed a purchase and sale agreement to dispose of the 9 Times Square property for a contract purchase price of$ 63.5 million, expected to close by January 2025[255] - The company did not make any new acquisitions or investments in the quarter ended September 30, 2024[219] - The company has not declared any dividends since June 30, 2022, and there is no assurance of future dividends[246] - The company has not paid dividends to stockholders since those declared and paid through the six months ended June 30, 2022[263] Challenges and Risks - The company faced challenges in leasing and maintaining occupancy due to the ongoing impacts of the COVID-19 pandemic, affecting cash flows and compliance with mortgage debt covenants[166] - The geopolitical instability and inflationary conditions have been identified as risks that could impact future operations and financial results[159] Cash and Liquidity - Cash and cash equivalents were $5.2 million as of September 30, 2024, compared to$ 5.3 million at the end of 2023[220] - Restricted cash increased to $10.5 million as of September 30, 2024, from$ 7.5 million as of December 31, 2023[221] - The company had $3.1 million in restricted cash due to loan covenant breaches at 1140 Avenue of the Americas as of September 30, 2024, compared to$ 2.5 million as of December 31, 2023[231] Capital Expenditures - Capital expenditures for the nine months ended September 30, 2024, totaled $0.9 million, primarily for tenant and building improvements[252] - The company expects capital expenditures for the full year ending December 31, 2024, to be lower compared to 2023[253] Adjusted EBITDA - Adjusted EBITDA for the three months ended September 30, 2024, was$ 3.095 million, compared to $3.410 million for the same period in 2023[262]