Presidio Property Trust(SQFT) - 2025 Q2 - Quarterly Results

Supplemental Financial Information This section outlines forward-looking statements, emphasizing inherent risks and uncertainties that could cause actual results to differ Forward-Looking Statements This section outlines the nature of forward-looking statements, emphasizing inherent risks and uncertainties that could cause actual results to differ materially from projections - Forward-looking statements involve risks and uncertainties, potentially causing actual results to differ materially from expectations[4][5] - Key factors influencing actual results are detailed in the Annual Report on Form 10-K and Quarterly Report on Form 10-Q, including global, regional, or local political, economic, business, competitive, market, and regulatory factors[4][5] Company Overview Provides an overview of the company's corporate structure, real estate portfolio, asset value, and debt Corporate Information Presidio Property Trust, Inc. is an internally managed real estate company focused on acquiring and managing office, industrial, and model home properties Corporate Profile | Headquarters | San Diego, CA | |---|---| | Founded | 1999 | | Key Geographies | CA, CO, MD, ND & TX | | Employees | 14 | - Presidio Property Trust, Inc. (formerly NetREIT) was founded in 1999 and is an internally managed real estate company[10] - The company focuses on commercial real estate (office and industrial) in overlooked, regionally dominant markets and generates fees/rental income from model homes[10] Portfolio Summary The company's portfolio includes 8 office, 1 retail, 1 industrial property, and 87 model homes, totaling over 1 million square feet Portfolio Summary (Number / Square Footage) | Office | 8 properties / 608,076 sqft. | |---|---| | Retail | 1 properties / 10,500 sqft. | | Industrial | 1 property / 150,099 sqft. | | Model Homes | 87 homes / 260,227 sqft | Portfolio Value & Debt As of June 30, 2025, the portfolio's book value was $114.6 million, with secured debt totaling $94.6 million Portfolio Value & Debt (June 30, 2025) | Book Value | $114.6 million | |---|---| | Existing Secured Debt | $94.6 million | - The commercial portfolio alone has a book value of approximately $78.5 million[10] Real Estate Portfolio Details Details the commercial and model homes real estate portfolios, including asset values and impairment charges Commercial Portfolio The commercial portfolio's net assets decreased to $73.73 million by June 30, 2025, due to property sales and impairment charges Commercial Properties Real Estate Assets and Lease Intangibles, Net | Property Name | June 30, 2025 | December 31, 2024 | |---|---|---| | Genesis Plaza | $7,274,090 | $7,363,571 | | Dakota Center | $4,838,139 | $8,154,951 | | Grand Pacific Center | $8,332,564 | $8,413,926 | | Arapahoe Center | $9,058,658 | $9,298,534 | | Union Town Center | — | $8,922,943 | | West Fargo Industrial | $6,469,043 | $6,599,953 | | 300 N.P. | $1,990,914 | $1,963,000 | | Research Parkway | — | $2,220,284 | | One Park Center | $5,482,703 | $5,580,950 | | Shea Center II | $17,595,866 | $18,820,370 | | Mandolin | $4,554,707 | $4,600,562 | | Baltimore | $8,129,102 | $8,241,456 | | Commercial properties total | $73,725,786 | $90,180,500 | - Union Town Center and Research Parkway were sold in February 2025 for a combined $16.95 million, resulting in a net gain of approximately $4.2 million[12] - Dakota Center was impaired by $3.3 million as of June 30, 2025, due to uncertainties in the Fargo market and a pending sale to settle a non-recourse loan[12] - Shea Center II incurred an impairment charge of approximately $0.9 million during Q2 2025, following the non-renewal of a major tenant (Halliburton) in December 2022[12] Model Homes Portfolio The model homes portfolio comprises 87 properties generating $3.79 million in annual rent, with Texas as the largest market, and incurred a $0.1 million impairment charge Model Homes Portfolio Summary (June 30, 2025) | State | No. of Properties | Aggregate Square Feet | % of Square Feet | Current Base Annual Rent | % Annual Rent | |---|---|---|---|---|---| | Alabama | 10 | 23,835 | 9.2% | $347,064 | 9.2% | | Arizona | 2 | 6,822 | 2.6% | $149,196 | 3.9% | | Tennessee | 2 | 5,534 | 2.1% | $89,304 | 2.4% | | Texas | 73 | 224,036 | 86.1% | $3,207,360 | 84.5% | | Total | 87 | 260,227 | 100.0% | $3,792,924 | 100.0% | - An impairment charge of $0.1 million was recorded for model homes during the three and six months ended June 30, 2025, attributed to short hold periods and builder style changes[13] Consolidated Financial Statements Presents consolidated balance sheets, statements of operations, and cash flows, highlighting key financial changes and performance Consolidated Balance Sheets Total assets decreased to $128.4 million by June 30, 2025, driven by reduced real estate assets, while liabilities and equity also declined Key Balance Sheet Data | Metric | June 30, 2025 | December 31, 2024 | |---|---|---| | Total Assets | $128,400,413 | $142,569,650 | | Real estate assets, net | $114,576,297 | $127,596,500 | | Real estate assets held for sale, net | $7,286,923 | $22,185,742 | | Total Liabilities | $99,023,400 | $107,624,495 | | Mortgage notes payable, total net | $94,603,804 | $102,094,094 | | Total Equity | $29,377,013 | $34,945,155 | Consolidated Statements of Operations Total revenue decreased to $8.5 million, but net loss significantly improved to $(4.16) million for the six months ended June 30, 2025 Key Income Statement Data (Six Months Ended June 30) | Metric | 2025 | 2024 | |---|---|---| | Total revenue | $8,503,925 | $9,376,603 | | Total costs and expenses | $12,761,010 | $10,242,619 | | Impairment of goodwill and real estate assets | $4,344,332 | $196,793 | | Gain on sales of real estate, net | $4,777,327 | $2,829,998 | | Net loss in Conduit Pharmaceuticals marketable securities | $(184,459) | $(13,888,667) | | Net loss attributable to Presidio Property Trust, Inc. common stockholders | $(4,164,844) | $(18,155,066) | | Basic & Diluted EPS | $(3.42) | $(14.69) | - Net loss attributable to common stockholders improved significantly by 77.0% YoY for the six months ended June 30, 2025, primarily driven by a substantial reduction in losses from marketable securities[18] Consolidated Statements of Cash Flows Net cash used in operating activities decreased to $(1.01) million, while financing activities used more cash for the six months ended June 30, 2025 Key Cash Flow Data (Six Months Ended June 30) | Metric | 2025 | 2024 | |---|---|---| | Net cash used in operating activities | $(1,012,227) | $(1,301,028) | | Net cash provided by investing activities | $11,372,797 | $12,960,482 | | Net cash used in financing activities | $(11,111,977) | $(9,635,001) | | Real estate acquisitions | $(9,444,465) | $(5,740,918) | | Proceeds from sales of real estate, net | $21,544,343 | $20,058,923 | | Repayment of mortgage notes payable | $(14,014,678) | $(17,282,249) | | Repurchase of Series A Common Stock, at cost | $(1,526,551) | $(7,613) | | Cash, cash equivalents and restricted cash - end of period | $7,285,089 | $8,534,881 | - Cash and cash equivalents decreased by $751,407 for the six months ended June 30, 2025, compared to an increase of $2,024,453 in the prior year period[20] Non-GAAP Financial Measures Reconciles and defines key non-GAAP financial measures: EBITDAre, FFO, and Core FFO, highlighting adjustments from GAAP net income EBITDAre Reconciliation EBITDAre significantly improved to $1.06 million for the six months ended June 30, 2025, driven by reduced marketable securities losses and higher real estate gains EBITDAre Reconciliation (Six Months Ended June 30) | Metric | 2025 | 2024 | |---|---|---| | Net (loss) income attributable to common stockholders | $(4,164,844) | $(18,155,066) | | Interest Expense | $2,988,341 | $3,041,051 | | Depreciation and Amortization | $2,453,531 | $2,699,901 | | Asset Impairment | $4,344,332 | $196,793 | | Net loss (gain) on sale of real estate | $(4,777,327) | $(2,829,998) | | Net change in marketable securities | $184,459 | $13,889,227 | | Income Taxes | $28,501 | $160,586 | | EBITDAre | $1,056,993 | $(997,506) | - EBITDAre showed a positive turnaround, increasing from a loss of $(997,506) in H1 2024 to a gain of $1,056,993 in H1 2025[21] FFO and Core FFO Reconciliation FFO improved to $(1.62) million, while Core FFO declined to $(1.08) million for the six months ended June 30, 2025 FFO and Core FFO Reconciliation (Six Months Ended June 30) | Metric | 2025 | 2024 | |---|---|---| | Net (loss) income attributable to common stockholders | $(4,164,844) | $(18,155,066) | | Depreciation and amortization | $2,455,796 | $2,702,388 | | Impairment of real estate assets | $4,344,332 | $196,793 | | Net change in Conduit marketable securities | $184,459 | $13,889,227 | | Loss (gain) on sale of real estate assets, net | $(4,777,327) | $(2,829,998) | | FFO | $(1,619,381) | $(2,225,910) | | Restricted stock compensation | $544,376 | $885,029 | | Cost associated with Zuma Capital Management | - | $565,534 | | Core FFO | $(1,075,005) | $(775,347) | | Core FFO / Wgt Avg Share | $(0.88) | $(0.63) | - FFO improved by 27.2% YoY, while Core FFO declined by 38.6% YoY for the six months ended June 30, 2025[22] Definitions of Non-GAAP Measures This section defines key non-GAAP financial measures: EBITDAre, FFO, and Core FFO, noting their supplementary nature and calculation limitations - EBITDAre is defined as earnings before interest, taxes, depreciation, and amortization, gain or loss on disposal of depreciated assets, and impairment write-offs[28] - FFO (Funds From Operations) is a non-GAAP measure defined as net income or loss (GAAP), excluding gains/losses from property sales, hedge ineffectiveness, certain acquisition/lease costs, plus depreciation/amortization and impairment charges, with adjustments for non-consolidated REITs[29] - Core FFO adjusts NAREIT's FFO for non-core items like acquisition costs, loss on early debt extinguishment, changes in fair value of earn-outs/contingent consideration, non-cash warrant dividends, other non-recurring expenses, and stock-based compensation amortization[31] Segment Data Analyzes financial performance and asset allocation across Retail, Office/Industrial, and Model Homes segments Segmented Operating Performance Office/Industrial generated the highest revenue but largest net loss, while Retail reported a significant net income from property sales for the six months ended June 30, 2025 Total Revenues by Segment (Six Months Ended June 30, 2025) | Segment | Total Revenues | |---|---| | Retail | $356,852 | | Office/Industrial | $6,150,163 | | Model Homes | $1,933,496 | | Corporate and Other | $63,414 | | Total | $8,503,925 | Net Operating Income (NOI) and Adjusted NOI by Segment (Six Months Ended June 30, 2025) | Segment | NOI | Adjusted NOI | |---|---|---| | Retail | $251,460 | $251,460 | | Office/Industrial | $2,982,301 | $2,982,301 | | Model Homes | $1,835,399 | $2,281,945 | | Corporate and Other | $359,517 | $359,517 | | Total | $5,428,677 | $5,875,223 | Net Income (Loss) by Segment (Six Months Ended June 30, 2025) | Segment | Net Income (Loss) | |---|---| | Retail | $4,211,872 | | Office/Industrial | $(5,029,197) | | Model Homes | $393,272 | | Corporate and Other | $(2,246,652) | | Total | $(2,670,705) | Segmented Assets Office/Industrial properties remain the largest asset segment at $70.23 million, while Retail assets significantly decreased due to property sales Total Assets by Reportable Segment | Segment | June 30, 2025 | December 31, 2024 | |---|---|---| | Office/Industrial Properties | $70,228,381 | $76,292,662 | | Model Home Properties | $41,464,138 | $38,166,964 | | Retail Properties | $4,703,901 | $16,673,605 | | Total assets for reportable segments | $116,396,420 | $131,133,231 | - The significant decrease in Retail Properties assets is likely due to the sale of Union Town Center and Research Parkway, which were previously listed under the commercial portfolio and contributed to a gain on sales of real estate in the Retail segment's operating performance[12][26][27]