Financial Highlights - The Partnership reported a net loss of $7.1 million or $0.35 per Beneficial Unit Certificate (BUC) for the three months ended June 30, 2025 [5] - Cash Available for Distribution (CAD) was $5.7 million or $0.25 per BUC [5] - Total assets amounted to $1.48 billion, with total Mortgage Revenue Bond (MRB) and Governmental Issuer Loan (GIL) investments at $1.13 billion [5] Investment and Financing Activity - The Partnership extended the maturity date for its corporate credit lines and increased total borrowing capacity by $30 million [3] - An additional capital commitment of approximately $60 million was received for the BlackRock construction lending joint venture from a second institutional investor [3] - Advances and acquisitions of various investments totaled approximately $47.6 million, while redemptions and sales totaled approximately $70.6 million [6] Revenue and Expenses - Total revenues for the second quarter of 2025 were $23.6 million, compared to $22.0 million in the same period of 2024, reflecting an increase of approximately 7.4% [15] - Total expenses for the second quarter of 2025 were $29.3 million, compared to $17.9 million in the same period of 2024, indicating a significant increase [15] - The provision for credit losses was $9.1 million for the second quarter of 2025, compared to $19.7 thousand in the same period of 2024 [15] Distribution Information - A regular quarterly distribution of $0.30 per BUC was declared in June 2025 and paid on July 31, 2025 [2] - The distribution was made to BUC holders of record as of the close of trading on June 30, 2025 [2] Management Insights - The CEO emphasized a focus on lending associated with low-income housing tax credit projects [3] - The Partnership's investment strategy includes acquiring additional mortgage revenue bonds and leveraging attractive financing structures available in the securities market [10]

Financial Data and Key Metrics Changes - The company reported GAAP net income of $3.3 million, or $0.11 per unit, for Q1 2025, significantly impacted by $3.9 million of non-cash unrealized losses on interest rate derivatives [13] - Cash available for distribution (CAD) was reported at $7.1 million, or $0.31 per unit [13] - The book value per unit decreased to $12.59, down $0.56 from December 31 [15] - Unrestricted cash and cash equivalents increased significantly to $51.4 million from $14.7 million as of December 31 [16] Business Line Data and Key Metrics Changes - The investment portfolio had no forbearance requests for multifamily mortgage revenue bonds, with all borrowers current on payments as of March 31, 2025 [8] - Physical occupancy for the stabilized mortgage revenue bond portfolio was at 89.5% [8] - The company funded $60.6 million in mortgage revenue bonds and related investments during Q1 [20] Market Data and Key Metrics Changes - The U.S. Municipal bond market faced challenges, with investment-grade tax-exempt bonds being the worst-performing fixed income asset class in Q1 2025 [28] - The ten-year MMD was at 3.33% and the thirty-year MMD at 4.4% as of the latest close, reflecting an increase from previous months [29] - Total fund flows for Q1 2025 were positive at about $11 billion, but April saw $3.6 billion in outflows [32] Company Strategy and Development Direction - The company is focusing on deepening relationships with existing sponsors and establishing new ones, particularly in affordable housing construction lending [33] - The partnership with BlackRock is aimed at capitalizing on opportunities in the construction lending space due to a pullback from commercial banks [33] Management's Comments on Operating Environment and Future Outlook - Management noted that uncertainty in the municipal bond market continues, influenced by tariffs and potential changes in federal funding programs [30][31] - The company expects to monitor the impact of legislative changes on municipal credit ratings and valuations [36] Other Important Information - The company successfully issued $20 million of Series B preferred units in March 2025 [26] - The debt investment portfolio consists of mortgage revenue bonds, governmental issuer loans, and property loans totaling $1.29 billion, representing 84% of total assets [19] Q&A Session Summary Question: Will proposed shifts from federal to state/local governments affect muni credit ratings and valuations? - Management indicated it is still early in the process and that discussions are ongoing regarding potential changes in funding allocations [36][38] Question: Have tariffs impacted the BlackRock JV business? - Management stated that there have been no significant changes in pro formas from sponsors due to higher tariffs on construction materials [41][42] Question: Are gains from JV sales expected to be lower than in previous years? - Management acknowledged that insurance costs significantly impacted the sale of the Tomball asset, but the Halodis asset did not experience the same increase in expenses [45][46] Question: How is the partner Vantage holding up given lower profitability? - Management noted that Vantage's business model includes developer fees, which helps mitigate the impact of lower gains on sales [50][52] Question: Can you provide an update on gross ROEs in the MRB and GIL business? - Management indicated that the hedging program has stabilized funding costs, leading to relatively constant ROE expectations [54][56]