CTO Realty Growth(US:CTO)2023-02-22 16:00PART I Item 1. BUSINESS The company is a self-managed equity REIT focused on retail and mixed-use properties, with diverse business segments and a 2020 REIT conversion - CTO Realty Growth, Inc. is a self-managed equity REIT specializing in high-quality retail and mixed-use properties in faster-growing markets15 - As of December 31, 2022, the company owned 23 commercial real estate properties (8 single-tenant, 15 multi-tenant) across 9 states, totaling 3.7 million square feet of leasable space16 - The company's business segments include management services for PINE, commercial loan and preferred equity investments, and real estate operations (subsurface mineral interests and mitigation credits)171821 Summary of Financial Information by Business Segment (in thousands) | Segment | 2022 Revenues | 2021 Revenues | 2020 Revenues | | :--------------------------------- | :-------------- | :-------------- | :-------------- | | Income Properties | $68,857 | $50,679 | $49,953 | | Management Services | $3,829 | $3,305 | $2,744 | | Interest Income from Commercial Loans and Investments | $4,172 | $2,861 | $3,034 | | Real Estate Operations | $5,462 | $13,427 | $650 | | Total Revenues | $82,320 | $70,272 | $56,381 | | Segment | 2022 Operating Income | 2021 Operating Income | 2020 Operating Income | | Income Properties | $48,493 | $36,864 | $37,964 | | Management Fee Income | $3,829 | $3,305 | $2,744 | | Commercial Loans and Investments | $4,172 | $2,861 | $3,034 | | Real Estate Operations | $2,969 | $4,812 | $(2,572) | | Total Operating Income | $10,667 | $23,345 | $12,280 | | Segment | 2022 Identifiable Assets | 2021 Identifiable Assets | 2020 Identifiable Assets | | Income Properties | $902,427 | $630,747 | $531,325 | | Management Services | $1,370 | $1,653 | $700 | | Commercial Loans and Investments | $32,269 | $39,095 | $38,321 | | Real Estate Operations | $4,041 | $26,512 | $59,717 | | Discontinued Real Estate Operations | — | — | $833 | | Corporate and Other | $46,438 | $35,132 | $35,804 | | Total Assets | $986,545 | $733,139 | $666,700 | - The business plan focuses on investing in multi-tenant, retail-oriented properties in high-growth markets, diversifying geographically, and utilizing Section 1031 like-kind exchanges for tax deferral242526 - In 2022, the company acquired five income properties for an aggregate acquisition cost of $315.6 million3133 - In 2022, six income properties were sold for $81.1 million, generating aggregate gains of $4.7 million34 Income Property Occupancy Rates (as of December 31st) | Year | Single-Tenant Economic / Physical Occupancy | Multi-Tenant Economic / Physical Occupancy | | :--- | :------------------------------------ | :----------------------------------- | | 2020 | 100% / 100% | 83% / 82% | | 2021 | 100% / 100% | 86% / 85% | | 2022 | 100% / 100% | 89% / 86% | - The company converted to a REIT for U.S. federal income tax purposes effective December 31, 2020, and reincorporated in Maryland in January 2021 to comply with REIT requirements565762 Item 1A. RISK FACTORS The company faces significant risks from real estate ownership, PINE management, financial factors, REIT compliance, and the COVID-19 pandemic - Risks related to commercial real estate ownership include tenant financial hardship, local market conditions, e-commerce competition, and concentration of revenue in specific industries or geographies1283878990919293949596979899100102103104105106107108 - Risks associated with PINE management include potential loss of fees, conflicts of interest due to shared officers and directors, and the possibility of PINE internalizing management functions1283110111112113114115117118 - Financial risks include credit risk from commercial loans, potential losses from borrower defaults, illiquidity of real estate investments, and challenges in obtaining debt or equity capital on favorable terms1286119120121122123124125126127128129130131132133134135136137139140141142148149150153154155156157158159160[161](index=161&type=chunk] - Risks related to REIT qualification include potential loss of REIT status, limitations on financial flexibility, and the requirement to distribute at least 90% of taxable income1286187188189190191192193194195196198199200201202203205206207208209210211212213 - The COVID-19 Pandemic has significantly impacted global economic activity and financial markets, posing risks to tenant operations, rent payments, and access to capital20171240241243245 Item 1B. UNRESOLVED STAFF COMMENTS The company reported no unresolved staff comments from the SEC - There are no unresolved staff comments252 Item 2. PROPERTIES The company's principal offices are in Winter Park, Florida, owning 23 income-producing properties across 9 states, plus subsurface interests and mitigation credits - The company's principal offices are located at 369 N. New York Avenue, Suite 201, Winter Park, Florida 32789253 - As of December 31, 2022, the company owned 8 single-tenant and 15 multi-tenant properties in 9 states, subsurface oil, gas, and mineral interests underlying 355,000 surface acres in 19 Florida counties, and an inventory of mitigation credits254 Item 3. LEGAL PROCEEDINGS The company is involved in incidental legal proceedings but does not anticipate a material effect on its financial condition or operations - The Company may be a party to certain legal proceedings incidental to the normal course of its business255 - The Company does not expect these legal proceedings to have a material effect upon its financial condition or results of operations255 Item 4. MINE SAFETY DISCLOSURES The company states that mine safety disclosures are not applicable to its operations - Mine safety disclosures are not applicable256 PART II Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES The company's common stock trades on the NYSE, has paid continuous dividends since 1976, and executed a stock repurchase program in 2022 - The Company's common stock trades on the NYSE under the symbol 'CTO'259 - The Company has paid dividends on a continuous basis since 1976259 Annual Dividends Per Common Share | Year Ended December 31 | Dividends Per Common Share | | :----------------------- | :------------------------- | | 2022 | $1.49 | | 2021 | $1.33 | - As of February 17, 2023, there were 458 stockholders of record262 - No unregistered sales of equity securities occurred during 2022263 - In 2022, the company repurchased 145,724 shares of common stock for $2.8 million at an average price of $19.15 per share under its $10.0 million repurchase program354 - On February 16, 2023, the Board approved a new common stock repurchase program for up to $5.0 million at an average price of $17.00 or less per share355 Item 6. RESERVED This item is reserved and contains no information Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This section analyzes the company's financial condition and operations as a self-managed equity REIT, including historical data, non-GAAP reconciliations, and performance comparisons - The Company is a publicly traded, self-managed equity REIT focused on ownership, management, and repositioning of high-quality retail and mixed-use properties in faster-growing markets269 - As of December 31, 2022, the company owned 23 commercial real estate properties (8 single-tenant, 15 multi-tenant) across 9 states, totaling 3.7 million square feet of gross leasable space270 - The company's business segments include income properties, management services for PINE, commercial loans and investments, and real estate operations (subsurface mineral interests and mitigation credits)271272275 Selected Historical Financial Information (in thousands, except per share amounts) | Metric | 2022 | 2021 | 2020 | 2019 | 2018 | | :------------------------------------------ | :----- | :----- | :----- | :----- | :----- | | Total Revenues | $82,320 | $70,272 | $56,381 | $44,941 | $43,658 | | Operating Income | $10,667 | $23,345 | $12,280 | $34,199 | $31,385 | | Net Income Attributable to the Company | $3,158 | $29,940 | $78,509 | $114,973 | $37,168 | | Net Income (Loss) Attributable to Common Stockholders | $(1,623) | $27,615 | $78,509 | $114,973 | $37,168 | | Basic Net Income (Loss) per Share Attributable to Common Stockholders | $(0.09) | $1.56 | $5.56 | $7.68 | $2.26 | | Diluted Net Income (Loss) per Share Attributable to Common Stockholders | $(0.09) | $1.56 | $5.56 | $7.67 | $2.24 | | Dividends Declared and Paid - Common Stock | $1.49 | $1.33 | $4.63 | $0.15 | $0.09 | | Total Assets | $986,545 | $733,139 | $666,700 | $704,194 | $556,841 | | Stockholders' Equity | $504,770 | $430,480 | $350,899 | $285,413 | $211,761 | | Long-Term Debt | $445,583 | $278,273 | $273,830 | $286,310 | $247,114 | Reconciliation of Non-U.S. GAAP Measures (in thousands) | Metric | 2022 | 2021 | 2020 | | :------------------------------------------ | :----- | :----- | :----- | | Net Income Attributable to the Company | $3,158 | $29,940 | $78,509 | | Funds from Operations (FFO) | $34,832 | $22,064 | $27,468 | | FFO Attributable to Common Stockholders | $30,051 | $19,739 | $27,468 | | Core Funds From Operations Attributable to Common Stockholders | $32,212 | $22,766 | $24,573 | | Adjusted Funds From Operations Attributable to Common Stockholders | $33,925 | $25,676 | $26,215 | | FFO Attributable to Common Stockholders per Common Share - Diluted | $1.62 | $1.12 | $1.95 | | Core FFO Attributable to Common Stockholders per Common Share - Diluted | $1.74 | $1.29 | $1.74 | | AFFO Attributable to Common Stockholders per Common Share - Diluted | $1.83 | $1.45 | $1.86 | Total Revenue by Operating Segment (in thousands) | Operating Segment | 2022 Revenue | 2021 Revenue | $ Variance (2022 vs 2021) | % Variance (2022 vs 2021) | | :--------------------------------- | :----------- | :----------- | :------------------------ | :------------------------ | | Income Properties | $68,857 | $50,679 | $18,178 | 35.9% | | Management Services | $3,829 | $3,305 | $524 | 15.9% | | Commercial Loans and Investments | $4,172 | $2,861 | $1,311 | 45.8% | | Real Estate Operations | $5,462 | $13,427 | $(7,965) | (59.3)% | | Total Revenue | $82,320 | $70,272 | $12,048 | 17.1% | - Total revenue increased by $12.0 million (17.1%) in 2022 compared to 2021, primarily due to increased income property acquisitions and higher management fees, partially offset by a decrease in real estate operations revenue from a non-recurring land sale in 2021292 - Net income attributable to the Company decreased from $29.9 million in 2021 to $3.2 million in 2022, primarily due to a $11.9 million loss on the sale of the Mitigation Bank in 2022, compared to $28.2 million in aggregate gains from property dispositions in 2021, and a $17.6 million impairment charge in 2021 related to the Land JV300303304310 - Cash flows from operating activities increased by $28.5 million to $56.1 million in 2022, driven by growth in the income property portfolio and proceeds from the Mitigation Bank sale342 - Cash flows used in investing activities increased by $164.6 million to $267.6 million in 2022, mainly due to a net increase in cash outflows for income property acquisitions343 - Cash flows provided by financing activities increased by $128.5 million to $201.4 million in 2022, primarily from increased net debt and proceeds from common stock offerings344 - The company expects sufficient liquidity for operations, capital requirements, maintenance, and debt service for the foreseeable future, supported by cash on hand, operating cash flow, and $186.2 million available on its $300.0 million Credit Facility353 Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The company's primary market risk is interest rate risk from its variable-rate Credit Facility, hedged by swaps, with a hypothetical 100 basis point increase impacting results by $1.1 million in 2022 - The principal market risk is interest rate risk, primarily from the variable-rate Credit Facility360361 - A hypothetical 100 basis point (1%) increase in interest rates would affect the company's financial position, results of operations, and cash flows by $1.1 million in 2022 and $0.7 million in 2021361 - The company uses interest rate swap agreements to hedge against changes in future cash flows from fluctuating interest rates, minimizing exposure to interest rate changes361 Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA This section presents the company's audited consolidated financial statements for 2020-2022, including balance sheets, statements of operations, comprehensive income, stockholders' equity, and cash flows, with detailed notes and schedules Reports of Independent Registered Public Accounting Firm Grant Thornton LLP issued unqualified opinions on the consolidated financial statements and internal control over financial reporting, identifying real estate fair value as a critical audit matter - Grant Thornton LLP provided an unqualified opinion on the consolidated financial statements for the three years ended December 31, 2022, confirming conformity with U.S. GAAP403 - An unqualified opinion was also issued on the effectiveness of the company's internal control over financial reporting as of December 31, 2022404414 - The evaluation of the fair value of real estate acquired with in-place leases was identified as a critical audit matter due to the complexity and sensitivity of significant assumptions (discount rates, terminal rates, market rental rates)408409410 Consolidated Balance Sheets The consolidated balance sheets show total assets increased to $986.5 million in 2022, driven by real estate, with corresponding increases in liabilities and stockholders' equity Consolidated Balance Sheet Highlights (in thousands) | Metric | December 31, 2022 | December 31, 2021 | | :--------------------------------- | :------------------ | :------------------ | | ASSETS | | | | Real Estate—Net | $734,721 | $494,695 | | Intangible Lease Assets—Net | $115,984 | $79,492 | | Investment in Alpine Income Property Trust, Inc. | $42,041 | $41,037 | | Commercial Loans and Investments | $31,908 | $39,095 | | Cash and Cash Equivalents | $19,333 | $8,615 | | Restricted Cash | $1,861 | $22,734 | | Total Assets | $986,545 | $733,139 | | LIABILITIES | | | | Long-Term Debt | $445,583 | $278,273 | | Total Liabilities | $481,775 | $302,659 | | STOCKHOLDERS' EQUITY | | | | Total Stockholders' Equity | $504,770 | $430,480 | - Total assets increased by $253.4 million (34.6%) from 2021 to 2022, primarily due to a $240.0 million increase in Real Estate—Net422 - Total liabilities increased by $179.1 million (59.2%) from 2021 to 2022, largely driven by a $167.3 million increase in Long-Term Debt422 Consolidated Statements of Operations Total revenues increased to $82.3 million in 2022, but net income significantly decreased to $3.2 million due to disposition losses and higher expenses Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | 2022 | 2021 | 2020 | | :------------------------------------------ | :----- | :----- | :----- | | Total Revenues | $82,320 | $70,272 | $56,381 | | Total Operating Expenses | $(64,611) | $(71,812) | $(54,988) | | Gain (Loss) on Disposition of Assets | $(7,042) | $28,316 | $9,746 | | Total Operating Income | $10,667 | $23,345 | $12,280 | | Net Income Attributable to the Company | $3,158 | $29,940 | $78,509 | | Net Income (Loss) Attributable to Common Stockholders | $(1,623) | $27,615 | $78,509 | | Basic and Diluted Net Income (Loss) Attributable to Common Stockholders per Share | $(0.09) | $1.56 | $5.56 | - Total revenues increased by $12.0 million (17.1%) from 2021 to 2022, primarily driven by a $18.2 million increase in Income Properties revenue425 - Net income attributable to the Company decreased significantly from $29.9 million in 2021 to $3.2 million in 2022, largely due to a shift from a $28.3 million gain on disposition of assets in 2021 to a $7.0 million loss in 2022, and increased depreciation and interest expenses425 Consolidated Statements of Comprehensive Income Total comprehensive income decreased to $17.4 million in 2022, influenced by lower net income and a gain from cash flow hedging derivatives Consolidated Statements of Comprehensive Income (in thousands) | Metric | 2022 | 2021 | 2020 | | :------------------------------------------ | :----- | :----- | :----- | | Net Income Attributable to the Company | $3,158 | $29,940 | $78,509 | | Cash Flow Hedging Derivative - Interest Rate Swaps | $14,244 | $3,427 | $(1,984) | | Total Comprehensive Income | $17,402 | $33,367 | $76,525 | - Total comprehensive income decreased from $33.4 million in 2021 to $17.4 million in 2022, primarily due to the significant decrease in net income, partially offset by a higher gain from cash flow hedging derivatives427 Consolidated Statements of Stockholders' Equity Total stockholders' equity increased to $504.8 million in 2022, driven by stock issuance and comprehensive income, partially offset by dividends Consolidated Statements of Stockholders' Equity Highlights (in thousands) | Metric | December 31, 2022 | December 31, 2021 | December 31, 2020 | | :------------------------------------------ | :------------------ | :------------------ | :------------------ | | Preferred Stock | $30 | $30 | — | | Common Stock | $229 | $60 | $7,250 | | Additional Paid-In Capital | $172,471 | $85,414 | $83,183 | | Retained Earnings | $316,279 | $343,459 | $339,917 | | Accumulated Other Comprehensive Income (Loss) | $15,761 | $1,517 | $(1,910) | | Total Stockholders' Equity | $504,770 | $430,480 | $350,899 | - Total stockholders' equity increased by $74.3 million (17.3%) from 2021 to 2022429 - Key drivers for the change in equity in 2022 included $94.8 million from stock issuance (net), $14.2 million from other comprehensive income, and $3.2 million in net income, offset by $29.6 million in common stock dividends and $4.8 million in preferred stock dividends429 Consolidated Statements of Cash Flows Operating cash flows increased to $56.1 million in 2022, while investing activities used $267.6 million and financing activities provided $201.4 million Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | 2022 | 2021 | 2020 | | :------------------------------------------ | :----- | :----- | :----- | | Net Cash Provided By Operating Activities | $56,097 | $27,577 | $16,930 | | Net Cash Used In Investing Activities | $(267,629) | $(102,967) | $(91,122) | | Net Cash Provided By (Used In) Financing Activities | $201,377 | $72,914 | $(26,888) | | Net Decrease in Cash, Cash Equivalents and Restricted Cash | $(10,155) | $(2,476) | $(101,080) | | Cash, Cash Equivalents and Restricted Cash, End of Period | $21,194 | $31,349 | $33,825 | - Net cash provided by operating activities increased by $28.5 million (103.3%) in 2022, primarily due to increased cash flows from income properties and the sale of the Mitigation Bank342432 - Net cash used in investing activities increased by $164.7 million (160.0%) in 2022, mainly due to higher income property acquisitions343432 - Net cash provided by financing activities increased by $128.5 million (176.2%) in 2022, driven by increased net debt and proceeds from capital markets activity (common stock offering and ATM)344432 Notes to Consolidated Financial Statements The notes detail accounting policies, business segments, and financial line items, including REIT operations, acquisitions, debt, and tax implications - The Company operates as a publicly traded, self-managed equity REIT, focusing on retail and mixed-use properties, management services for PINE, commercial loans, and real estate operations439440441442446 - The Company adopted ASU 2021-01 (LIBOR cessation) and ASU 2020-06 (convertible instruments accounting) effective January 1, 2022, impacting diluted EPS calculations for 2025 Notes457458 - As of December 31, 2022, restricted cash totaled $1.9 million, including $0.6 million for the Mitigation Bank escrow and $1.3 million in interest reserve accounts for commercial loans460 - The company's investment in PINE totaled $42.0 million as of December 31, 2022, representing 14.6% of PINE's outstanding equity, and is carried at fair value with unrealized gains/losses recognized in net income444551 - In 2022, the company acquired five income properties for $315.6 million and sold six for $81.1 million, resulting in $4.7 million in aggregate gains496497498 - The commercial loans and investments portfolio had a carrying value of $31.9 million at December 31, 2022, down from $39.1 million in 2021, reflecting new originations and principal repayments515 - Management fee revenue from PINE was $3.8 million in 2022, up from $3.2 million in 2021. No incentive fee was earned in 2022 or 2021518 - Real estate operations revenue decreased to $5.5 million in 2022 from $13.4 million in 2021, primarily due to the non-recurring sale of the Daytona Beach Development in 2021. The Mitigation Bank was sold in December 2022 for $8.1 million, resulting in an $11.9 million loss526527 - Total long-term debt (face value) was $447.6 million at December 31, 2022, up from $278.3 million in 2021, with the Credit Facility, Term Loans, and Convertible Senior Notes being the main components592612 - The company's 3.875% Convertible Senior Notes due 2025 had an outstanding principal amount of $51.0 million at December 31, 2022, with a conversion rate adjusted to 62.2047 shares per $1,000 principal608609 - Total stock-based compensation expense was $3.2 million in 2022, with $1.4 million of unrecognized cost for performance share awards remaining621625 - The company elected REIT taxation status from December 31, 2020, resulting in an $82.5 million deferred tax benefit in 2020 from de-recognition of deferred tax assets/liabilities646 SCHEDULE III REAL ESTATE AND ACCUMULATED DEPRECIATION Schedule III details real estate assets and accumulated depreciation, showing a significant increase in total cost to $764.0 million in 2022 due to additions and improvements Real Estate and Accumulated Depreciation (in thousands) | Metric | 2022 | 2021 | 2020 | | :--------------------------------- | :----- | :----- | :----- | | Cost: | | | | | Balance at Beginning of Year | $521,260 | $472,126 | $392,842 | | Additions and Improvements | $281,562 | $206,646 | $147,359 | | Cost of Real Estate Sold | $(38,863) | $(157,512) | $(68,075) | | Balance at End of Year | $763,959 | $521,260 | $472,126 | | Accumulated Depreciation: | | | | | Balance at Beginning of Year | $23,936 | $30,316 | $22,552 | | Depreciation and Amortization | $16,262 | $12,270 | $11,207 | | Depreciation on Real Estate Sold | $(4,686) | $(18,650) | $(3,443) | | Balance at End of Year | $35,512 | $23,936 | $30,316 | - The total cost of real estate increased by $242.7 million (46.6%) in 2022, primarily due to $281.6 million in additions and improvements675 - Accumulated depreciation increased by $11.6 million (48.5%) in 2022, reflecting $16.3 million in depreciation and amortization675 SCHEDULE IV MORTGAGE LOANS ON REAL ESTATE Schedule IV details mortgage loans on real estate, with a portfolio carrying value of $31.9 million in 2022, reflecting new originations and principal collections - As of December 31, 2022, the company's portfolio included three commercial loan investments and one preferred equity investment, classified as commercial loan investments678 Mortgage Loans on Real Estate (in thousands) - December 31, 2022 | Description | Interest Rate | Final Maturity Date | Face Amount of Mortgages | Carrying Amounts of Mortgages | | :------------------------------------------ | :------------ | :------------------ | :----------------------- | :---------------------------- | | Mortgage Note – 4311 Maple Avenue – Dallas, TX | 7.50% | April 2023 | $400 | $395 | | Construction Loan – The Exchange At Gwinnett – Buford, GA | 7.25% | January 2024 | $220 | $173 | | Preferred Investment - Watters Creek – Allen, TX | 8.50% | April 2025 | $30,000 | $29,887 | | Improvement Loan - Ashford Lane – Atlanta, GA | 12.00% | April 2025 | $1,453 | $1,453 | | Totals | | | $32,073 | $31,908 | Commercial Loans and Investments Segment Activity (in thousands) | Metric | 2022 | 2021 | 2020 | | :--------------------------------- | :----- | :----- | :----- | | Balance at Beginning of Year | $39,095 | $38,320 | $34,625 | | New Mortgage Loans | $53,282 | $364 | $28,360 | | Collection of Principal | $(61,634) | — | $(23,132) | | Balance at End of Year | $31,908 | $39,095 | $38,320 | Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE The company reported no changes in or disagreements with its accountants regarding accounting and financial disclosures - There have been no disagreements with our accountants on accounting and financial disclosures363 Item 9A. CONTROLS AND PROCEDURES Management concluded disclosure controls and internal control over financial reporting were effective as of December 31, 2022, with no material changes during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of December 31, 2022365 - Management assessed and believes the company maintained effective internal control over financial reporting as of December 31, 2022, based on the 2013 COSO Framework368 - No changes in internal control over financial reporting materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting during the fourth fiscal quarter369 Item 9B. OTHER INFORMATION This item states that there is no other information to report - No other information is reported under this item370 Item 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS The company states that this disclosure item is not applicable - Disclosure regarding foreign jurisdictions that prevent inspections is not applicable371 PART III Item 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE Information regarding directors, executive officers, and corporate governance is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement373 Item 11. EXECUTIVE COMPENSATION Information regarding executive compensation is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement374 Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS Information concerning security ownership of certain beneficial owners and management is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement376 Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Information regarding certain relationships, related transactions, and director independence is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement377 Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Information on principal accountant fees and services is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement378 PART IV Item 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES This section lists the financial statements, schedules, and exhibits filed as part of the 10-K report, including audited financials and various agreements - The report includes consolidated financial statements: Balance Sheets, Statements of Operations, Comprehensive Income, Stockholders' Equity, and Cash Flows, along with Notes to Consolidated Financial Statements381399 - Financial statement schedules include Schedule III—Real Estate and Accumulated Depreciation and Schedule IV—Mortgage Loans on Real Estate382 - A detailed Exhibit Index is provided, listing various agreements (e.g., merger, purchase and sale, credit facility, management), corporate documents (articles, bylaws), and certifications (Sarbanes-Oxley Act)383387 Item 16. FORM 10-K SUMMARY This item indicates that a Form 10-K summary is not applicable - Form 10-K Summary is not applicable384 SIGNATURES This section contains the signatures of the registrant's authorized officers and directors, affirming the filing of the report on February 23, 2023 - The report is signed by the President and Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, Chairman of the Board, and other Directors396397 - The report was signed on February 23, 2023396397