Financial Data and Key Metrics Changes - For the quarter ending December 31, 2025, the company generated distributable earnings of $0.27 per share, impacted by a loan foreclosure which reduced earnings by approximately $0.03 per share [8][16] - For the full year ended December 31, 2025, net interest income was $21.6 million, with distributable earnings of $15.2 million or $1.19 per share [16] - The company ended the fourth quarter with total assets of $310.2 million and total shareholder equity of $182 million, with a book value of $13.56 per share [18] Business Line Data and Key Metrics Changes - The company closed on $368 million of loans during the fiscal year, with $247 million committed and $224 million funded by the company [7] - In the fourth quarter of 2025, the company closed on $56 million of commitments, including loans for industrial and retail properties [12] - As of February 27, 2026, the portfolio, excluding the Thompson Hotels, consisted of $442.1 million of current commitments and $337 million of principal outstanding across 16 loans [17] Market Data and Key Metrics Changes - The company observed a bifurcation in the commercial real estate lending market, with lenders focused on multifamily and industrial assets experiencing tight spreads [10] - The company noted that the market volatility has created opportunities for transitional deals, despite recent uncertainty due to rising rates [21][23] Company Strategy and Development Direction - The company remains focused on providing loans for transitional real estate business plans, primarily in the Southern United States, with a strategy centered on residential loans [5] - The company aims to partner with top-tier sponsors for high-quality real estate projects, emphasizing structured solutions for complex deals [11][13] Management's Comments on Operating Environment and Future Outlook - Management indicated that the current market volatility presents both challenges and opportunities, particularly in identifying transitional deals [21][23] - The company expressed confidence in its ability to capitalize on attractive opportunities despite the uncertain macroeconomic environment [46][47] Other Important Information - The board of directors declared a $0.30 dividend per share for the quarter ended March 31, 2026, which is expected to be covered over the next 6-12 months [8][32] - The company increased its revolving credit facility to $165 million, with potential to expand to $200 million [9] Q&A Session Summary Question: Market dynamics and investment opportunities - The company noted that market volatility has created a gap in transitional deals, providing opportunities despite uncertainty [21][23] Question: Loan pipeline reduction - Management confirmed that the loan pipeline decreased to $652 million due to a focus on high-quality, actionable deals amidst market volatility [27][28] Question: Foreclosure of the San Antonio asset - The company explained that the Thompson Hotel foreclosure was due to management issues and cash flow constraints, despite the asset being high-quality [29][30] Question: Dividend coverage expectations - Management stated that the board is confident in covering the dividend over the next 6-12 months [32] Question: Capital deployment trends - Management reflected on the evolving opportunity set and the need for selective capital deployment in light of market conditions [44][46]

Financial Data and Key Metrics Changes - For Q3 2025, the company generated distributable earnings of $0.31 per share, covering the dividend of $0.30 per share [5][15] - The net interest income for the quarter was $6.1 million, with GAAP net income of $4.05 million [14][15] - As of September 30, 2025, total assets were $258.8 million, and total shareholder equity was $184.6 million, resulting in a book value of $13.76 per share [16] Business Line Data and Key Metrics Changes - The company’s portfolio had $367 million in commitments and $253 million in principal outstanding across 13 loans as of September 30, 2025 [16] - The weighted average loan-to-cost at closing was only 56%, indicating conservative positioning [6] - The portfolio yield to maturity was approximately 11.8% [16] Market Data and Key Metrics Changes - There has been a notable increase in financing requests, indicating a recovery in the real estate market [9] - The bid-ask spread between buyers and sellers is narrowing, which is increasing transaction volume [10] - Most new financing activity is concentrated in the bridge lending space, particularly in multifamily and industrial properties [11] Company Strategy and Development Direction - The company focuses on originating transitional loans primarily in the southern United States, aiming for attractive risk-adjusted returns [5][6] - The long-term goal is to achieve an investment-grade rating within the next three to five years [6] - The company is expanding its presence in the southern U.S., with a focus on states like Florida, Texas, North Carolina, Georgia, and Tennessee [19][20] Management's Comments on Operating Environment and Future Outlook - Management noted a renewed sense of interest rate stability, encouraging more sponsors to engage in capital planning [9] - The company remains confident in its ability to capitalize on attractive opportunities in the current market environment [13] - The underlying construction activity and progression of loans are performing as expected, with no significant issues reported [32] Other Important Information - The company has a CESL reserve of approximately $400,000, or 17 basis points for loans at carrying value [16] - The company is not pursuing a repo line and aims to maintain a conservative leverage strategy [26][29] Q&A Session Summary Question: What new geographies within the southern U.S. are being seen in the pipeline? - The company is focusing on Florida, Texas, North Carolina, Georgia, and Tennessee, with a preponderance of deals in these areas [19] Question: Are there any geographies that stand out as the most attractive for investment? - Texas and Florida continue to present interesting opportunities, with the Carolinas and Tennessee also being areas of focus [20] Question: How is the debt side of the business strategy progressing? - The company is focused on expanding bank lines and is considering preferred or unsecured debt offerings, avoiding high-leverage deals [26][27][29] Question: How is the portfolio performing and what trends are being observed? - The portfolio is performing as expected, with steady progress in construction and sales, and a recent pickup in for-sale projects noted [32]