Generation me Properties(US:GIPR)2025-11-14 22:26Portfolio Performance - As of September 30, 2025, approximately 60% of the portfolio's annualized base rent (ABR) was derived from tenants with an investment grade credit rating of "BBB-" or better[147] - The portfolio is 98.6% leased and occupied, indicating strong demand for the properties[147] - Average effective annual rental per square foot is $16.30, reflecting the rental income potential of the portfolio[147] - Approximately 92% of the leases in the current portfolio provide for increases in contractual base rent during future years[147] - The largest tenants contributing to the portfolio's ABR include the General Service Administration, Dollar General, and Kohl's Corporation, with the City of San Antonio contributing approximately 59% of the ABR[147] Financial Performance - Total revenue for the three months ended September 30, 2025, was $2,470,109, an increase of $69,827 (approximately 2.9%) compared to $2,400,282 for the same period in 2024[165] - Total revenue for the nine months ended September 30, 2025, was $7,283,974, an increase of $191,284 (approximately 2.7%) compared to $7,092,690 for the same period in 2024[165] - Total operating expenses for the three months ended September 30, 2025, were $4,169,441, an increase of $399,726 (approximately 10.6%) compared to $3,769,715 for the same period in 2024[166] - Total operating expenses for the nine months ended September 30, 2025, were $12,832,102, an increase of $1,698,716 (approximately 15.3%) compared to $11,133,386 for the same period in 2024[166] - Net loss attributable to common shareholders for the three months ended September 30, 2025, was $2,826,960, compared to a net loss of $2,969,596 for the same period in 2024[169] - Net loss attributable to common shareholders for the nine months ended September 30, 2025, was $9,981,447, compared to a net loss of $8,151,538 for the same period in 2024[169] Cash and Debt Management - As of September 30, 2025, the company had total cash of $281,788 and outstanding mortgage loans with a principal balance of $55,762,746[170] - The company entered into a loan agreement for $21.0 million on August 10, 2023, to finance the acquisition of the Modiv Portfolio, with a fixed interest rate of 7.47% per annum[173] - The company incurred interest expense, net of $4,429,454 for the nine months ended September 30, 2025, an increase of $1,286,965 (approximately 41%) compared to $3,142,489 for the same period in 2024[166] - As of September 30, 2025, the company had outstanding mortgage loans payable totaling $71,599,000, with various interest rates and maturity dates[185] - The company recorded a related party payable of $2,912,300 upon execution of a Redemption Agreement, which was paid in full by September 30, 2025[180] Equity and Financing Activities - The company completed an underwritten public offering of 1,665,000 units at $10 per unit, generating net proceeds of $13.8 million[145] - The company primarily obtains capital through equity offerings, debt financings, and undistributed operational funds[182] - The company has the right to extend the Mandatory Redemption Date for the Preferred Interest for two consecutive 12-month periods, with an extension fee of 0.01% of the outstanding amount[191] Concerns and Compliance - The company expressed substantial doubt about its ability to continue as a going concern due to recurring losses and liquidity concerns[183] - The company’s projected cash needs are less than the principal balance of its obligations, indicating potential liquidity challenges[183] - The company maintained compliance with all covenants related to mortgage loans, including a debt service coverage ratio (DSCR) requirement of 1.50[188] Operational Metrics - Net cash provided by operating activities was $415,553 for the nine months ended September 30, 2025, compared to $783,511 for the same period in 2024[198] - Net cash provided by investing activities was $10,333,595 for the nine months ended September 30, 2025, contrasting with a cash outflow of ($5,960,892) in 2024[199] - Net cash used in financing activities was ($11,114,799) for the nine months ended September 30, 2025, compared to a cash inflow of $3,607,045 in 2024[200] Funds From Operations - Funds From Operations (FFO) for Q3 2025 was $(419,486), a decline from $(301,352) in Q3 2024, indicating a 39.2% increase in losses[208] - Core Funds From Operations (Core FFO) for Q3 2025 was $47,548, compared to $(145,885) in Q3 2024, showing a significant recovery[208] - Adjusted Funds From Operations (AFFO) for Q3 2025 was $(117,838), a decrease from $5,509 in Q3 2024, reflecting a 2,174.5% decline[208] - Core Adjusted Funds From Operations for Q3 2025 was $175,647, up from $100,444 in Q3 2024, indicating a 74.7% increase[208] Other Financial Metrics - Depreciation and amortization expenses increased to $1,287,112 in Q3 2025 from $1,068,081 in Q3 2024, a rise of 20.5%[208] - Loss on derivative valuation for Q3 2025 was $11,256, compared to a gain of $734,116 in Q3 2024, indicating a significant shift in valuation[208] - Total adjustments to net loss amounted to $1,600,016 in Q3 2025, compared to $2,109,058 in Q3 2024, a decrease of 24.1%[208] - Non-cash stock compensation for Q3 2025 was $0, down from $94,935 in Q3 2024, reflecting a complete elimination of this expense[208] - The company reported a loss on extinguishment of debt of $926,398 for the nine months ended September 30, 2025, with no such loss reported in the same period of 2024[208]