What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-07 compared with 2025-11-06 · 188 added, 263 removed, 331 unchanged (58% of the section changed)

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● changes in national, regional and local economic conditions, which may be negatively impacted by concerns about inflation, deflation, tariffs and global trade tensions, government deficits, high unemployment rates, decreased consumer confidence and liquidity concerns, particularly in markets in which we have a high concentration of properties;

● adverse economic trends and changes in economic conditions, including slower growth or recession, changes to fiscal and monetary policy, inflation, changing interest rates, tariffs and international trade policies and disputes, geopolitical conditions, structural shifts and regulatory changes to the commercial banking systems of the U.S.

and Western Europe, labor shortages, currency fluctuations, challenges in global supply chains, and the effects of international conflicts on global markets;

● fluctuations and relative increases in interest rates, which could adversely affect our ability to obtain financing on favorable terms or at all;

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Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements after the date of this report, whether as a result of new information, future events, changed circumstances or any other reason.

The forward-looking statements should be read in light of the risk factors set forth in Item 1A of this Quarterly Report on Form 10-Q, in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 as filed with the Securities and Exchange Commission (“SEC”) on March 20, 2025, and subsequent filings by us with the SEC, or “Risk Factors”.

We own and operate a portfolio of institutional residential properties including single-family homes, build-to-rent communities, and other residential communities located in attractive markets with a focus on the knowledge-economy and high-quality of life growth markets of the Sunbelt and Western United States.

The forward-looking statements should be read in light of the risk factors set forth in Item 1A of this Quarterly Report on Form 10-Q, in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 as filed with the Securities and Exchange Commission (“SEC”) on February 27, 2026, and subsequent filings by us with the SEC, or “Risk Factors”.

We own and operate a portfolio of institutional residential properties including apartments, build-to-rent communities, single-family homes, and other residential communities located in attractive markets with a focus on the knowledge-economy and high-quality of life growth markets of the Sunbelt and Western United States.

Our current investment strategy is focused on growing our portfolio of residential communities.

Our principal objective is to generate attractive risk-adjusted returns on investments where we believe we can drive growth in funds from operations and net asset value by acquiring residential units, developing residential communities, and through Value-Add renovations.

Our Value-Add strategy focuses on repositioning lower-quality, less current assets to drive rent growth and expand margins to increase net operating income and maximize our return on investment.

As of September 30, 2025, we held twenty-two real estate investments, consisting of seventeen consolidated investments and five preferred equity investments.

The twenty-two investments represent an aggregate of 5,282 residential units, comprised of 4,170 consolidated units, of which 358 units are under development, and 1,112 units through preferred equity investments, which includes planned units and those under development.

As of September 30, 2025, our consolidated operating investments were approximately 91.8% occupied;

We have no employees and are supported by a related-party service agreement with the Manager (the “Management Agreement”).

We are externally managed by the Manager, which manages our day-to-day operations under the Management Agreement.

The current term of the Management Agreement expires October 6, 2026 and will be automatically renewed for a one-year term each year on October 6, unless previously terminated in accordance with the terms of the Management Agreement.

The Manager is responsible for managing our affairs on a day-to-day basis and for identifying and making real estate investments on our behalf.

Substantially all our business is conducted through our Operating Partnership, of which we are the sole general partner.

The twenty-three consolidated and preferred equity investments represent an aggregate of 5,451 residential units, comprised of 4,302 consolidated units, of which 380 units are under development or in lease-up, and 1,149 units through preferred equity investments, which includes planned units and those under development.

As of March 31, 2026, our consolidated operating investments were approximately 92.0% occupied;

excluding units classified as held for sale and down/renovation units, our consolidated operating investments were approximately 93.6% occupied.

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In addition, these residential communities typically have onsite property management.

Scattered single-family homes segment includes the acquisition, ownership, management, and renovation of scattered single-family homes, which are, generally, detached homes with no onsite property management.

Scattered single-family homes segment includes the ownership, management, and renovation of scattered single-family homes, which are, generally, detached homes with no onsite property management.

Inflation and Related Economic Volatility

While inflationary pressures have shown signs of moderation, we continue to monitor increases in inflation and rising interest rates and resulting economic changes in credit and capital markets.

During the three months ended March 31, 2026, economic uncertainty and stock market volatility continued due to a number of factors, including persistent inflation, interest rate uncertainty, concerns about tariffs, supply chain or trade disruptions and geopolitical conflict.

While these factors did not have a significant adverse impact on us during the three months ended March 31, 2026, they may adversely impact us in the future.

Inflation and its related impacts, including increased prices for services and goods and higher interest rates and wages, and any policy interventions by the U.S.

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Higher construction costs could adversely impact our investments in real estate assets and our expected yields on development projects.

We continue to monitor increases in inflation and rising interest rates and resulting economic changes in credit and capital markets, as well as direct and indirect impacts resulting from the uncertainty related to, or changes to, the overall regulatory and economic environment and from geopolitical conditions and the effects of international conflicts on global markets.

Additionally, developments in the banking industry in early 2023 caused uncertainty and concern regarding the strength of the banking system.

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Other weakened economic conditions, including job losses, high unemployment levels, stock market volatility, and uncertainty about the future, could adversely affect rental rates and occupancy levels.

In addition, during the nine months ended September 30, 2025, the current U.S.

In addition, during 2025, the current U.S.

administration has introduced tariffs on imports from a broad set of countries, including Canada, Mexico, European Union member states, Japan and China, in response to which global trading partners have imposed or may impose their own tariffs.

Such tariffs, and any additional tariffs imposed by the current administration or other countries, may cause further inflationary pressures in the economy, uncertainty and volatility of debt and equity markets, and a slowdown in the U.S.

and global economies.

The announced tariffs are likely to increase construction costs and further reduce already constrained new supply starts, which could adversely impact the timing of actual completion and/or stabilization of our build-to-rent communities, including potential delays due to supply shortages and labor shortages.

In response to a February 2026 U.S.

Supreme Court holding that the administration may not rely on the International Emergency Economic Powers Act, or IEEPA, to impose broad-based tariffs, the administration has since turned to alternative temporary statutory authorities to maintain certain surcharges and has indicated that it intends to preserve a broader tariff regime through other trade rules and legal authorities.

tariffs, together with actual and potential additional tariffs imposed by the current administration or other countries, contributed to increased volatility in financial markets and interest rates during 2025 and may cause further inflationary pressures in the economy, uncertainty and volatility of debt and equity markets, and a slowdown in the U.S.

and global economies in the future.

Such tariffs are likely to increase construction costs and further reduce already constrained new supply starts, which could adversely impact the timing of actual completion and/or stabilization of our build-to-rent communities, including potential delays due to supply shortages and labor shortages.

Any of these factors could depress economic activity and have a material adverse effect on our business, financial condition, cash flows, and our results of operations.

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Investment Activity Summary

Provided below is a summary of our investment activity during the nine months ended September 30, 2025.

Acquisition of Southern Pines Reserve

On April 28, 2025, we, through a Delaware statutory trust (the “Southern Pines DST”), acquired a 272-unit residential community located in Aberdeen, North Carolina known as Southern Pines Reserve, aka Hawthorne.

The purchase price of $56.6 million was funded with (i) a $30.7 million senior loan secured by Southern Pines Reserve, (ii) borrowings of $20.0 million through our existing credit facility with KeyBank National Association (the “KeyBank Credit Facility”), and (iii) cash of $8.9 million funded by us, inclusive of certain adjustments typical in such real estate transactions.

Acquisition of Skytop Apartments

On September 29, 2025, we, through a Delaware statutory trust (the “Skytop DST”), acquired a 361-unit residential community located in Cincinnati, Ohio known as Skytop Apartments.

The purchase price of $88.5 million was funded with (i) a $57.5 million senior loan secured by Skytop Apartments, (ii) borrowings of $22.0 million through the KeyBank Credit Facility, and (iii) cash of $13.0 million funded by the us, inclusive of certain adjustments typical in such real estate transactions.

Southern Pines Reserve and Skytop Apartments are the second and third properties, respectively, that we have acquired through Delaware statutory trusts (each, a “DST”) to be part of private placement offerings through which interests in each DST will be issued to third party accredited investors therein.

Harmony at Clear Creek Development

On September 30, 2025, we, through a joint venture with an unaffiliated third party (the “Harmony JV”), in which we hold an 85% interest, acquired land located in Shawnee, Kansas for a purchase price of $2.3 million for the development of an approximately 188-unit residential community to be known as Harmony at Clear Creek.

In connection with the acquisition and planned development, the Harmony JV entered into a construction loan agreement providing for borrowings of up to $46.5 million.

At September 30, 2025, the outstanding balance under the construction loan was negligible and is included in mortgages payable on our consolidated balance sheets.

The interest rate cap associated with the construction loan, and any capitalized interest, is recorded within construction in process on the consolidated balance sheets.

We account for Harmony at Clear Creek as a consolidated investment.

Acquisition of Additional Interests in Investments

On July 11, 2025, we purchased the noncontrolling partner’s interest in each of the Peak JV 2 and Peak JV 3 portfolios for $0.2 million and $0.9 million, respectively.

We increased our interest in (i) the Peak JV 2 portfolio from 80% to 100% and (ii) the Peak JV 3 portfolio from 56% to 100%.

Sales of Consolidated Operating Units

Provided below is a summary of our investment activity during the three months ended March 31, 2026.

Parkside at Summers Corner

We acquired, with full ownership interest, an additional 10 units at Parkside at Summers Corner located in Summerville, South Carolina for an aggregate purchase price of $2.6 million.

Units are to be acquired in tranches as construction is completed, and as of March 31, 2026, we had acquired 22 of the total 100 units we have committed to purchase.

Sale of Consolidated Operating Units

We closed on the following sales:

20 units in the ILE portfolio, 14 units in the Indy-Springfield portfolio, 22 units in the Peak JV 2 portfolio, and 48 units in the Peak JV 3 portfolio, pursuant to the terms and conditions of multiple separate purchase and sale agreements.

10 units in the Ballast portfolio, 19 units in the Golden Pacific portfolio, 25 units in the ILE portfolio, 6 units in the Indy-Springfield portfolio, 29 units in the Peak JV 2 portfolio, and the remaining 42 units in the Peak JV 3 portfolio, pursuant to the terms and conditions of multiple separate purchase and sale agreements.

The 131 units were all previously classified as held for sale and sold for an aggregate of approximately $22.0 million, subject to certain closing costs, prorations and adjustments typical in such real estate transactions.

After deducting the paydown of existing mortgage indebtedness encumbering 25 units in the ILE portfolio of approximately $3.5 million, the sales of the 131 units generated net proceeds of approximately $17.2 million and a gain on sales of approximately $0.6 million.

Loan Investment Activity

Our two remaining loan investments were paid off in full, including any accrued but unpaid interest amounts, as follows:

(i) Wayford at Pringle in the aggregate amount of $23.0 million, which included our principal investment of $22.3 million and accrued interest of $0.7 million, and (ii) Willow Park in the aggregate amount of $9.4 million, which included our principal investment of $9.4 million and a negligible amount of accrued interest.

Unconsolidated Real Estate Fund Summary

On April 25, 2025, we closed on the acquisition of a limited partnership interest in Marble Capital Income and Impact Fund, LP (the “Marble Fund”) for a purchase price of $25.0 million.

We account for our investment in the Marble Fund under the equity method as we consider our degree of influence to be more than minor.

The Marble Fund owns a diversified portfolio of multifamily assets and build-to-rent multifamily investments located in the United States.

The gain on sales is included in gain on sale of real estate investments, net on our consolidated statements of operations and comprehensive income (loss).

Preferred Equity Investment Summary

Our preferred equity investment activity was as follows:

(i) we increased our original capital commitment for preferred equity interests in Wayford at Innovation Park by $2.0 million, increasing our total investment to $15.4 million, (ii) we entered into a joint venture agreement with an unaffiliated third party and made a commitment to invest $16.2 million for preferred equity interests in the development of an approximately 300-unit residential community located in Sanford, North Carolina known as Sanford Marketplace, and (iii) had our preferred equity investments in two joint ventures with unaffiliated third parties fully redeemed as follows:

(a) The Cottages at Myrtle Beach redeemed in the aggregate amount of $28.1 million, which included our principal investment of $17.9 million, and accrued preferred return and outstanding amounts of $10.2 million, and (b) The Cottages of Port St.

Lucie redeemed in the aggregate amount of $30.0 million, which included our principal investment of $18.8 million, and accrued preferred return and outstanding amounts of $11.2 million.

In addition, we sold our preferred equity interests in Indigo Cove and Wayford at Pringle to a joint venture, with such joint venture including an affiliate of Bluerock Homes Manager, LLC (our “Manager”), in the aggregate amounts of $4.2 million and $9.2 million, respectively, which included our outstanding principal investments and accrued preferred returns, net of any reimbursements.

As of September 30, 2025, we had funded $14.6 million of our $37.8 million aggregate commitment to fund capital for preferred equity interests in Canvas at Wildwood, River Ford, and Sanford Marketplace.

We increased our original capital commitment for preferred equity interests in Canvas at Wildwood by $1.5 million, increasing our total investment to $16.1 million.

As of March 31, 2026, we had funded $28.0 million of our $48.8 million aggregate commitment to fund capital for preferred equity interests in Archer at RiverBlue, Canvas at Wildwood, River Ford, and Sanford Marketplace.

Held for Sale

At September 30, 2025 and December 31, 2024, we classified an aggregate of 84 units and 167 units, respectively, as held for sale on our consolidated balance sheets.

For the three and nine months ended September 30, 2025 and 2024, we recorded an impairment of $0.4 million and $0.9 million, and $0.6 million and $2.1 million, respectively, related to held for sale units which is included in (impairment) and gain on sale of real estate investments, net on our consolidated statements of operations and comprehensive income.

The 84 units classified as held for sale at September 30, 2025 are all reported in our scattered single-family homes segment and are included in the following portfolios:

4 units of Golden Pacific, 5 units of ILE, 23 units of Indy-Springfield, 10 units of Peak JV 2, and all 42 units of Peak JV 3.

These units were identified based on submarket analysis and individual unit-level operational review.

At March 31, 2026 and December 31, 2025, we classified an aggregate of 58 units and 107 units, respectively, as held for sale on our consolidated balance sheets, with all units reported in our scattered single-family homes segment.

The 58 units classified as held for sale at March 31, 2026 are included in the following portfolios:

19 units of Ballast, 22 units of Golden Pacific, 1 unit of ILE, 12 units of Indy-Springfield, and 4 units of Peak JV 2.

At March 31, 2025, we classified an aggregate of 138 units as held for sale, with all units reported in our scattered single-family homes segment.

For the three months ended March 31, 2026 and 2025, we recorded impairments of $0.6 million and $0.1 million, respectively, related to held for sale units which is included in impairment of real estate investments on our consolidated statements of operations and comprehensive income (loss).

Units classified as held for sale were identified based on submarket analysis and individual unit-level operational review.

Real estate assets classified as held for sale are reported at the lower of their carrying value or estimated fair value less costs to sell and are presented separately within operating real estate held for sale, net on our consolidated balance sheets.

Real estate assets classified as held for sale generally represent assets that are actively marketed or contracted for sale with the closing expected to occur within one year.

Series A Redeemable Preferred Stock

During the nine months ended September 30, 2025, we issued 1,493,372 shares of 6.0% Series A Redeemable Preferred Stock (the “Series A Preferred Stock”) at $25.00 per share (the “Stated Value”) under a continuous registered offering with net proceeds of approximately $32.3 million after commissions, dealer manager fees and sales discounts, and costs related to establishing the offering of Series A Preferred Stock.

As of September 30, 2025, we have issued a total of 6,126,657 shares of Series A Preferred Stock with total net proceeds of approximately $133.4 million after commissions, dealer manager fees, sales discounts and offering costs.

Additionally, as of September 30, 2025, we, at the request of holders, had redeemed a total of 10,960 shares of Series A Preferred Stock through the issuance of 18,653 shares of Class A common stock and redeemed a total of 27,868 shares of Series A Preferred Stock in cash.

Series A Preferred Stock Redemption Safeguard Policy

On February 6, 2025, we implemented a new Series A Preferred Stock Redemption Safeguard Policy (the “Policy”) with respect to our Series A Preferred Stock.

The Policy is applicable in the event of any redemption of shares of Series A Preferred Stock in shares of our Class A common stock rather than in cash (each, a “Preferred Redemption in common stock”).

The Policy provides that if, within 10 business days of any such Preferred Redemption in common stock, any such shares of Class A common stock are sold at a loss (i.e.

a lower price than the Aggregate Redemption Value), the holder can apply to us for a cash payment to the holder in an amount equal to the difference between (i) the Aggregate Redemption Value of the Class A common stock so issued, and (ii) the Aggregate Sale Price at which such shares of Class A common stock were sold, subject to certain conditions and requirements as set forth in the Policy.

The Policy applies both retroactively, and on a go-forward basis, to holders of our Series A Preferred Stock.

In 2023, we filed a prospectus supplement to the registration statement on Form S-11 (File No.

333-269415) (the “2023 Registration Statement”) offering a maximum of 20,000,000 shares of 6.0% Series A Redeemable Preferred Stock (the “Series A Preferred Stock”) at $25.00 per share (the “Stated Value”), for a maximum offering amount of $500 million in Series A Preferred Stock (the “Series A Preferred Offering”).

On March 20, 2026, we made the final issuance of Series A Preferred Stock pursuant to the Series A Preferred Offering, and on March 31, 2026, the SEC declared effective our post-effective amendment to the 2023 Registration Statement to terminate the effectiveness of the 2023 Registration Statement and remove all unsold shares of Series A Preferred Stock from registration pursuant to the 2023 Registration Statement.

We issued a total of 6,527,513 shares of Series A Preferred Stock pursuant to the Series A Preferred Offering, with total net proceeds of approximately $141.8 million after commissions, dealer manager fees, sales discounts and offering costs.

During the three months ended March 31, 2026, we issued 190,200 shares of Series A Preferred Stock pursuant to the Series A Preferred Offering with net proceeds of approximately $4.2 million after commissions, dealer manager fees, sales discounts and costs related to establishing the offering of Series A Preferred Stock.

Additionally, as of March 31, 2026, we, at the request of holders, had redeemed a total of 10,960 shares of Series A Preferred Stock through the issuance of 18,653 shares of Class A common stock and redeemed a total of 43,490 shares of Series A Preferred Stock for $1.0 million in cash.

Series B Redeemable Preferred Stock

In December 2025, we filed a prospectus supplement to the registration statement on Form S-11 (File No.

333-290772) offering a maximum of 14,000,000 shares of 7.5% Series B Redeemable Preferred Stock (the “Series B Preferred Stock”) at $25.00 per share, for a maximum offering amount of $350 million in Series B Preferred Stock (the “Series B Preferred Offering”), and on February 20, 2026, we made the initial issuances of Series B Preferred Stock pursuant to the Series B Preferred Offering.

As of March 31, 2026, we had issued 104,288 shares of Series B Preferred Stock pursuant to the Series B Preferred Offering with net proceeds of approximately $1.5 million after commissions, dealer manager fees, sales discounts and costs related to establishing the offering of Series B Preferred Stock.

As of March 31, 2026, we had not redeemed any shares of Series B Preferred Stock.

Stockholders’ Equity

Our total stockholders’ equity decreased $7.4 million from $139.1 million as of December 31, 2024 to $131.7 million as of September 30, 2025.

The decrease in our total stockholders’ equity is primarily attributable to dividends declared of $8.2 million, preferred stock accretion of $3.4 million, and a net adjustment of $0.7 million for noncontrolling interests, partially offset by the acquisitions of noncontrolling interests for $2.7 million, net income of $1.4 million, Class A common stock issuances, net of forfeitures, of $0.5 million, and comprehensive income of $0.2 million.

Our total stockholders’ equity decreased $3.9 million from $128.7 million as of December 31, 2025 to $124.8 million as of March 31, 2026.

The decrease in our total stockholders’ equity is primarily attributable to net loss attributable to common stockholders of $3.4 million and common stock dividends declared of $0.5 million.

Results of Operations

The following is a summary of our consolidated real estate investments as of September 30, 2025:

The following is a summary of our consolidated real estate investments as of March 31, 2026:

Excluding Held

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Jacksonville, FL

District at Parkview (6)

Stone Mountain, GA

Skytop Apartments

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Indy-Springfield

Dallas-Fort Worth, TX

Total Scattered Single-Family Homes / Average

Total Operating Units / Average

Development Investment Name (7)

Development / Lease-up Investment Name

Residential Communities

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Harmony at Clear Creek (7)

Parkside at Summers Corner (8)

Summerville, SC

Total Development Units

Total operating units includes an aggregate of 58 units classified as held for sale, with such units included in the following portfolios:

4 units of Golden Pacific, 5 units of ILE, 23 units of Indy-Springfield, 10 units of Peak JV 2, and all 42 units of Peak JV 3.

Represents the average of the ending average effective rent per occupied unit as of the last day of each month in the three months ended September 30, 2025.

Percent occupied is calculated as (i) the number of units occupied as of September 30, 2025 divided by (ii) total number of units, expressed as a percentage.

Percent occupied is calculated as (i) the number of units occupied as of September 30, 2025 divided by (ii) total number of units, expressed as a percentage, and excludes 84 units classified as held for sale and an aggregate of 10 down/renovation units.

Amira at Westly is held through our DST Program (refer to Note 9 of our consolidated financial statements for further information).

The Amira at Westly DST has been fully subscribed with equity from individual investors.

Skytop Apartments and Southern Pines Reserve are held through our DST Program.

Represents build-to-rent development projects.

19 units of Ballast, 22 units of Golden Pacific, 1 unit of ILE, 12 units of Indy-Springfield, and 4 units of Peak JV 2.

Represents the average of the ending average effective rent per occupied unit as of the last day of each month in the three months ended March 31, 2026.

Percent occupied is calculated as (i) the number of units occupied as of March 31, 2026 divided by (ii) total number of units, expressed as a percentage.

Percent occupied is calculated as (i) the number of units occupied as of March 31, 2026 divided by (ii) total number of units, expressed as a percentage, and excludes 58 units classified as held for sale and an aggregate of 16 down/renovation units.

Amira at Westly and Skytop Apartments are held through our DST Program (refer to Note 9 of our consolidated financial statements for further information).

The Amira at Westly DST and Skytop Apartments DST have been fully subscribed with equity from individual investors.

District at Parkview and Southern Pines Reserve are held through our DST Program.

Represents a development project with no units delivered as of March 31, 2026.

Abode Wendell Falls commenced construction in 2024 and Harmony at Clear Creek is anticipated to commence construction in 2026.

The following is a summary of our consolidated operational results by reportable segment for the three and nine months ended September 30, 2025 and 2024 ($ in thousands, except average rental rates):

Three Months Ended September 30,

Nine Months Ended September 30,

Parkside at Summers Corner represents a development project with units to be acquired in tranches as construction is completed.

Of the total 100 units that we have committed to acquire, 22 units had been acquired as of March 31, 2026.

The following is a summary of our consolidated operational results by reportable segment for the three months ended March 31, 2026 and 2025 ($ in thousands, except average rental rates):

Three Months Ended March 31,

Rental and other property revenues

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Represents the average of the ending occupancy as of the last day of each month in the period presented for all units in our consolidated portfolio.

The amounts presented for 2024 include Navigator Villas which was sold in August 2024.

Represents the average of the ending average effective rent per occupied unit as of the last day of each month in the period presented.

The following is a summary of our preferred equity investments as of September 30, 2025:

The following is a summary of our preferred equity and loan investments as of March 31, 2026:

Total Actual /

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Canvas at Wildwood

Archer at RiverBlue

Asheville, NC

Total Development Units

Lease-up Investment Name

Total Lease-up Units

Operating Investment Name (3)

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Total Units/Average

None of the development investments had commenced lease-up as of September 30, 2025.

Represents the average pro forma effective monthly rent per occupied unit for all expected occupied units during the first full quarter of stabilization.

None of the development investments had commenced lease-up as of March 31, 2026.

For development investments, represents the average pro forma effective monthly rent per occupied unit for all expected occupied units during the first full quarter of stabilization.

For the operating investment, represents the average effective monthly rent per occupied unit.

Operating investment represents a stabilized operating property.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Rental and other property revenues increased $4.6 million, or 38%, to $16.6 million for the three months ended September 30, 2025 as compared to $12.0 million for the same prior year period.

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Rental and other property revenues increased $3.8 million, or 24%, to $19.7 million for the three months ended March 31, 2026 as compared to $15.9 million for the same prior year period.

The increase was primarily due to:

(i) the acquisition of 1,230 units at four residential communities, which was partially offset by sales of 176 units at one residential community and 165 single-family units in our portfolio since July 1, 2024, and (ii) rental rate improvement from our active management and organic market rent growth.

(i) the acquisition of 897 units at three residential communities, which was partially offset by the sales of 258 single-family units in our portfolio since January 1, 2025, and (ii) rental rate improvement from our active management and organic market rent growth.

Our average rent per occupied unit increased $10, or 0.6%, to $1,705 as compared to $1,695 during the prior year period.

Average occupancy increased 10 basis points from 91.8% to 91.9% on a year over year basis.

Interest income from loan investments amounted to zero for the three months ended September 30, 2025 as compared to $0.7 million for the same prior year period due to the full payoff of three loan investments prior to the third quarter of 2025.

We did not have any loan investments during the three months ended September 30, 2025.

Property operating expenses increased $2.3 million, or 36%, to $8.7 million for the three months ended September 30, 2025 as compared to $6.4 million for the same prior year period.

The increase was primarily due to the acquisition of 1,230 units at four residential communities, which was partially offset by sales of 176 units at one residential community and 165 single-family units in our portfolio since July 1, 2024.

Property management and asset management fee expenses were $1.3 million for the three months ended September 30, 2025 as compared to $1.2 million in the same prior year period.

Property management fees are based on a stated percentage of property revenues and asset management fees are based on a stated percentage of capital contributions or assets under management, where applicable.

General and administrative expenses amounted to $2.7 million for the three months ended September 30, 2025 as compared to $2.5 million for the same prior year period.

Of the $2.7 million total expense in the second quarter 2025, $1.7 million related to direct costs incurred by us, while the remaining $1.0 million related to the operating expense reimbursement to our Manager, which includes rent, utilities, and IT expenses.

Management fees to related party amounted to $2.6 million for the three months ended September 30, 2025 as compared to $2.4 million for the same prior year period.

The increase was due to an increase in equity primarily from our continuous registered offering of Series A Preferred Stock.

For the third quarter of 2025, we will pay $0.2 million of the base management fee in C-LTIP Units with the remainder in cash.

Prior to the fourth quarter 2024, we paid the base management fee to the Manager as one half (50%) in C-LTIP Units and the remainder in cash.

Weather-related losses were negligible for the three months ended September 30, 2025 as compared to $0.2 million for the same prior year period.

The 2024 expense primarily relates to hurricane damage in Texas.

Acquisition and other transaction costs amounted to $0.1 million for the three months ended September 30, 2025 and were negligible for the same prior year period.

Acquisition costs can vary greatly, and the costs incurred in any given period may be significantly different in future periods.

Depreciation and amortization expenses were $6.8 million for the three months ended September 30, 2025 as compared to $4.9 million for the same prior year period, with the increase primarily due to the acquisition of four residential communities since July 1, 2024.

The increase was partially offset by (i) the sales of one residential community and single-family units in our portfolio since July 1, 2024 and (ii) in-place leases being fully amortized at two residential communities prior to the third quarter 2025.

Other Income and Expense

Other income and expense amounted to expense of $3.9 million for the three months ended September 30, 2025 as compared to income of $8.4 million for the same prior year period.

This was primarily due to a $10.0 million decrease in gain on sales of real estate investments, a $3.2 million increase in impairment on real estate, a decrease in preferred returns of $0.9 million as funding to our preferred equity investments decreased to $45.0 million at September 30, 2025 as compared to $73.3 million at September 30, 2024.

These changes were partially offset by a $1.8 million gain on the sale of one preferred equity investment.

Income Tax Expense

Income tax expense amounted to $0.4 million for the three months ended September 30, 2025 as compared to zero for the same prior year period.

The 2025 expense primarily relates to income earned on certain taxable REIT subsidiaries for Amira at Westly, Southern Pines Reserve, and one preferred equity investment.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

Rental and other property revenues increased $14.5 million, or 42%, to $49.2 million for the nine months ended September 30, 2025 as compared to $34.7 million for the same prior year period.

The increase was primarily due to:

(i) the acquisition of 1,524 units at five residential communities, which was partially offset by sales of 176 units at one residential community and 202 single-family units in our portfolio since January 1, 2024, and (ii) rental rate improvement from our active management and organic market rent growth.

Our average rent per occupied unit increased $76, or 4.7%, to $1,693 as compared to $1,617 during the prior year period.

Average occupancy decreased 30 basis points from 91.9% to 91.6% on a year over year basis.

Interest income from loan investments amounted to $0.6 million for the nine months ended September 30, 2025 as compared to $1.7 million for the same prior year period due to the full payoff of three loan investments since the third quarter of 2024.

Property operating expenses increased $7.2 million, or 41%, to $24.6 million for the nine months ended September 30, 2025 as compared to $17.4 million for the same prior year period.

The increase was primarily due to the acquisition of 1,524 units at five residential communities, which was partially offset by sales of 176 units at one residential community and 202 single-family units in our portfolio since January 1, 2024.

Property management and asset management fee expenses were $4.0 million for the nine months ended September 30, 2025 as compared to $3.5 million in the same prior year period.

Our single-family rental rates increased 2.5% from active management and organic growth, and residential communities decreased 3.5% primarily as a result of our newly acquired properties rental rates being lower than average rental rate at $1,621 per month.

Interest income from loan investments amounted to zero for the three months ended March 31, 2026 as compared to $0.5 million for the same prior year period due to the full payoff of two loan investments since the first quarter of 2025.

Property operating expenses increased $1.4 million, or 18%, to $9.1 million for the three months ended March 31, 2026 as compared to $7.7 million for the same prior year period.

The increase was primarily due to the acquisition of 897 units at three residential communities, which was partially offset by sales of 258 single-family units in our portfolio since January 1, 2025.

Property management and asset management fee expenses were $1.6 million for the three months ended March 31, 2026 as compared to $1.3 million in the same prior year period.

General and administrative expenses amounted to $8.4 million for the nine months ended September 30, 2025 as compared to $7.8 million for the same prior year period.

Of the $8.4 million total expense for the nine months ended September 30, 2025, $5.4 million related to direct costs incurred by us, while the remaining $3.0 million related to the operating expense reimbursement to our Manager, which includes rent, utilities, and IT expenses.

Management fees to related party amounted to $7.8 million for the nine months ended September 30, 2025 as compared to $6.6 million for the same prior year period.

The increase was due to an increase in equity primarily from our continuous registered offering of Series A Preferred Stock.

For the nine months ended September 30, 2025, we will pay $0.6 million of the base management fee in C-LTIP Units with the remainder in cash.

Prior to the fourth quarter 2024, we paid the base management fee to the Manager as one half (50%) in C-LTIP Units and the remainder in cash

Weather-related losses amounted to $0.1 million for the nine months ended September 30, 2025 as compared to $0.2 million for the same prior year period.

The 2025 expense relates to weather damage at two residential communities and the 2024 expense primarily relates to hurricane damage in Texas.

Acquisition and other transaction costs amounted to $0.3 million for the nine months ended September 30, 2025 and were negligible for the same prior year period.

General and administrative expenses amounted to $3.1 million for the three months ended March 31, 2026 as compared to $3.1 million for the same prior year period.

Of the $3.1 million total expense in the first quarter 2026, $2.1 million relates to direct costs incurred by us, while the remaining $1.0 million relates to the operating expense reimbursement to our Manager, which includes rent, utilities, accounting and legal services, and IT expenses.

Management fees to related party amounted to $2.7 million for the three months ended March 31, 2026 as compared to $2.5 million for the same prior year period.

The increase was due to an increase in equity primarily from our Series A and Series B Preferred Offerings.

For the first quarter of 2026, we will pay $0.2 million of the base management fee in C-LTIP Units with the remainder in cash.

Acquisition and other transaction costs were minimal for the three months ended March 31, 2026 and amounted to $0.1 million for the same prior year period.

Acquisition costs can vary greatly, and the costs incurred in any given period may be significantly different in future periods.

Depreciation and amortization expenses were $21.4 million for the nine months ended September 30, 2025 as compared to $13.7 million for the same prior year period, with the increase primarily due to the acquisition of five residential communities since January 1, 2024.

The increase was partially offset by (i) the sales of one residential community and single-family units in our portfolio since January 1, 2024 and (ii) in-place leases being fully amortized at one residential community prior to 2025.

Weather-related losses amounted to $0.3 million for the three months ended March 31, 2026 as compared to zero for the same prior year period.

The 2026 expense relates to damage at one residential community.

Impairment of real estate investments amounted to $0.6 million for the three months ended March 31, 2026 as compared to $0.1 million for the same prior year period.

An impairment loss is recognized when we determine that the carrying value of operating and/or held for sale real estate, and related intangible assets, exceeds their estimated fair value.

Impairment amounts recorded during the three months ended March 31, 2026 and 2025 relate to held for sale single-family units.

Depreciation and amortization expenses were $8.9 million for the three months ended March 31, 2026 as compared to $7.5 million for the same prior year period, with the increase primarily due to the acquisition of three residential communities since January 1, 2025.

The increase was partially offset by (i) the sales of single-family units in our portfolio since January 1, 2025 and (ii) in-place leases being fully amortized at two residential communities prior to 2026.

Other Income and Expense

Other income and expense amounted to expense of $5.0 million for the nine months ended September 30, 2025 as compared to income of $8.0 million for the same prior year period.

This was primarily due to (i) a $9.0 million decrease in gain on sales of real estate investments, (ii) a $4.7 million increase in interest expense primarily attributable to an increase in the outstanding debt to $426.0 million at September 30, 2025 as compared to $166.7 million at December 31, 2023, (iii) a $2.2 million increase in impairment on real estate, and (iv) a decrease in preferred returns of $1.1 million as funding to our preferred equity investments decreased to $45.0 million at September 30, 2025 as compared to $81.3 million at December 31, 2023.

These changes were partially offset by a $3.2 million gain on the sale of two preferred equity investments and $0.7 million income from the investment in one unconsolidated real estate fund.

Other income and expense amounted to expense of $3.7 million for the three months ended March 31, 2026 as compared to expense of $1.1 million for the same prior year period.

This was primarily due to a decrease in preferred returns of $1.6 million as investments in our preferred equity investments decreased to $43.4 million at March 31, 2026 as compared to $82.2 million at December 31, 2024 due to the redemption and/or sale of five preferred equity investments partially offset by two new preferred equity investments, and $0.9 million of deferred offering costs that were expensed following the termination of our Series A Preferred Offering during the first quarter of 2026.

Income Tax Expense

Income tax expense amounted to $1.4 million for the nine months ended September 30, 2025 as compared to zero for the same prior year period.

The 2025 expense primarily relates to income earned on certain taxable REIT subsidiaries for Amira at Westly, Southern Pines Reserve, and three preferred equity investments.

Income tax expense amounted to $0.1 million for the three months ended March 31, 2026 as compared to $0.3 million for the same prior year period.

This decrease was primarily attributable to income tax expense recorded in the prior year period related to two preferred equity investments that were sold during 2025.

Net Operating Income

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However, NOI should only be used as a supplemental measure of our financial performance.

The following table reflects net (loss) income attributable to common stockholders together with a reconciliation to NOI, as computed in accordance with GAAP for the periods presented (amounts in thousands):

The following table reflects net loss attributable to common stockholders together with a reconciliation to NOI, as computed in accordance with GAAP for the periods presented (amounts in thousands):

Three Months Ended

Nine Months Ended

September 30,

Net (loss) income attributable to common stockholders

Net (loss) income attributable to Operating Partnership Units

Net (loss) income attributable to common stockholders and unit holders

Net loss attributable to common stockholders

Net loss attributable to Operating Partnership Units

Net loss attributable to common stockholders and unit holders

Net loss attributable to partially owned properties’ noncontrolling interests

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Unrealized loss on derivatives

Provision for (recovery of) credit losses

Recovery of credit losses

Property management and asset management fees

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Preferred stock accretion

Other expense (income), net

Other expense, net

Income tax expense

Income from preferred equity investments

Income from investments in unconsolidated real estate funds

Share of net earnings of equity method investment

Interest income from loan investments

Impairment and (gain on sale) of real estate investments, net

Gain on sale of available-for-sale investments

Impairment of real estate investments

Gain on sale of real estate investments, net

Total property income

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Liquidity is a measure of our ability to meet potential cash requirements, both short- and long-term.

Our primary short-term liquidity requirements historically have related to (i) our operating expenses and other general business needs, (ii) investment in real estate, (iii) distributions to stockholders, (iv) committed investments and capital requirements to fund development and renovations at existing properties, and (v) ongoing commitments to repay borrowings, including our maturing debt and the KeyBank Credit Facility.

Our ability to access capital on favorable terms as well as to use cash from operations to continue to meet our short-term liquidity needs could be affected by various risks and uncertainties, including the risks detailed in Part I, Item 1A titled “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024 as filed with the SEC on March 20, 2025.

While consolidated occupancy excluding units classified as held for sale and down/renovation units remains strong at 93.7% as of September 30, 2025, in future periods we may experience reduced levels of tenant retention, and reduced foot traffic and lease applications from prospective tenants.

In addition, in October 2024, we launched a program (collectively, the “DST Program”) to sponsor and raise capital in private placement offerings of beneficial interests in specific Delaware statutory trusts (each, a “DST”) holding real properties (each, a “DST Property”).

Our primary short-term liquidity requirements historically have related to (i) our operating expenses and other general business needs, (ii) investments in real estate, (iii) distributions to stockholders, (iv) committed investments and capital requirements to fund development and renovations at existing properties, (v) ongoing commitments to repay borrowings, including our maturing debt and KeyBank Credit Facility (as hereinafter defined, the “revolving credit facility”), and (vi) Class A common stock repurchases under our stock repurchase plan.

While consolidated occupancy excluding units classified as held for sale and down/renovation units remains strong at 93.6% as of March 31, 2026, in future periods we may experience reduced levels of tenant retention, and reduced foot traffic and lease applications from prospective tenants.

In October 2024, we launched a program (collectively, the “DST Program”) to sponsor and raise capital in private placement offerings of beneficial interests in specific Delaware statutory trusts (each, a “DST”) holding real properties (each, a “DST Property”).

We expect that the DST Program will give us the opportunity to expand and diversify our capital raise strategies by offering what we believe to be an attractive investment product for investors that may be seeking replacement properties to complete like-kind exchange transactions and create future pipeline acquisition opportunities.

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As compensation for the Operating Partnership’s obligations under the Master Leases, we will share in the rent paid by the tenants of the underlying properties in accordance with the waterfall set forth in the applicable Master Lease.

As of September 30, 2025, we had three DST Properties (Amira at Westly, Skytop Apartments and Southern Pines Reserve) in our DST Program and had raised net offering proceeds of $75.5 million, issued demand notes of $1.8 million, and had $243.9 million in total net real estate investments associated with the DST Program.

The Amira at Westly DST had been fully subscribed with equity from individual investors as of September 30, 2025.

As of March 31, 2026, we had four DST Properties (Amira at Westly, District at Parkview, Skytop Apartments and Southern Pines Reserve) in our DST Program and raised net offering proceeds of $139.4 million, issued demand notes of $2.3 million, and had $308.0 million in total net real estate investments associated with the DST Program.

The Amira at Westly DST and Skytop Apartments DST had been fully subscribed with equity from individual investors as of March 31, 2026.

In conjunction with sponsoring of the DST Program, our Operating Partnership is granted an option to acquire DST Interests from the DST Program’s beneficial owners at a later date for an aggregate value equal to such beneficial owner’s pro rata share of the appraised value of the properties, as determined by an independent appraisal firm, less any indebtedness encumbering such beneficial owner’s DST Interest or the beneficial owner’s pro rata share of any indebtedness encumbering the properties, which will be assumed or paid off by our Operating Partnership.

In general, we believe our available cash balances, cash flows from operations, proceeds from the offering of our Series A Preferred Stock, proceeds from the KeyBank Credit Facility (as hereinafter defined, the “revolving credit facility”), proceeds from our DST Program, proceeds from future mortgage debt financings for acquisitions and/or development projects, and other financing arrangements will be sufficient to fund our liquidity requirements with respect to our existing portfolio for the next 12 months.

In general, we believe our available cash balances, cash flows from operations, proceeds from the offering of our Series B Preferred Stock, proceeds from the revolving credit facility, proceeds from our DST Program, proceeds from future mortgage debt financings for acquisitions and/or development projects, and other financing arrangements will be sufficient to fund our liquidity requirements with respect to our existing portfolio for the next 12 months.

In general, we expect that our results related to our existing portfolio will improve in future periods as a result of anticipated future investments in and acquisitions of residential properties and build-to-rent communities.

We believe we will be able to meet our primary liquidity requirements going forward through, among other sources:

● $162.7 million in cash available at September 30, 2025;

● capacity of $50 million on the KeyBank Credit Facility, of which $28 million was available at September 30, 2025 for use in our DST Program;

● $170.1 million in cash available at March 31, 2026;

● capacity of $50 million on the revolving credit facility, all of which was available at March 31, 2026 for use in our DST Program;

● proceeds from future mortgage debt financings for acquisition and/or development projects;

● cash generated from operating activities;

● proceeds from the offering of our Series A Preferred Stock and potential offerings of common and preferred stock, as well as issuances of units of limited partnership interest in our Operating Partnership (“OP Units”).

The following table summarizes our contractual obligations as of September 30, 2025 related to our mortgage notes secured by our properties and revolving credit facility.

Our estimated future required payments on these obligations as of September 30, 2025 were as follows (amounts in thousands):

● proceeds from the offering of our Series B Preferred Stock and potential offerings of common and preferred stock, as well as issuances of units of limited partnership interest in our Operating Partnership (“OP Units”).

The following table summarizes our contractual obligations, and estimated future required payments on these obligations, related to our mortgage notes secured by our properties as of March 31, 2026 (amounts in thousands).

The revolving credit facility had no outstanding balance at the end of the period.

Mortgages Payable (Principal)

Revolving Credit Facility

Estimated Interest Payments on Mortgages Payable and Revolving Credit Facility

Estimated Interest Payments on Mortgages Payable

Estimated interest payments are based on the stated rates for mortgage notes payable assuming the interest rate in effect for the most recent quarter remains in effect through the respective maturity dates.

At September 30, 2025, we had contractual commitments to fund future cash obligations in certain of our preferred equity investments in the aggregate of $23.2 million.

As of March 31, 2026, we had contractual commitments to fund future cash obligations in certain of our preferred equity investments in the aggregate of $20.8 million.

In addition, we have two consolidated residential communities (Abode Wendell Falls and Harmony at Clear Creek) under construction comprised of an aggregate of 358 units.

As of September 30, 2025, we estimate that the remaining costs associated with the completion of construction for these two residential communities will be approximately $121.4 million.

As of March 31, 2026, we estimate that the remaining costs associated with the completion of construction for these two residential communities will be approximately $111.3 million.

We intend to finance these costs through a combination of available cash, proceeds from construction loans, and preferred equity capital contributions.

We also committed to acquire an aggregate of 100 residential community units known as Parkside at Summers Corner.

We expect acquisitions to occur in tranches as construction is completed, and as of March 31, 2026, 78 units remain to be acquired, representing an aggregate purchase price of $20.0 million.

As equity capital market conditions permit, we may supplement our capital for short-term liquidity needs with proceeds of potential offerings of our common and preferred stock, as well as the issuance of OP Units.

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The repurchase plan had a term of one year and ended in February 2026.

We made no repurchases of our Class A common stock under the plan.

On February 28, 2025, our Board authorized a new stock repurchase plan for the repurchase, from time to time, of up to an aggregate of $5 million of our outstanding shares of Class A common stock, with such repurchases to be conducted in accordance with the requirements of Rule 10b-18 of the Exchange Act and subject to Rule 10b-5 of the Exchange Act.

The repurchase plan has a term of one year and may be discontinued at any time.

We made no repurchases of our Class A common stock under this plan.

On February 10, 2026, the Board authorized a new stock repurchase plan, effective March 1, 2026, for the repurchase, from time to time, of up to an aggregate of $10 million of our outstanding shares of Class A common stock, with such repurchases to be conducted in accordance with the requirements of Rule 10b-18 of the Exchange Act of 1934 (the “Exchange Act”) and subject to Rule 10b-5 of the Exchange Act.

The repurchase plan has a term of one year and ends on February 28, 2027, and may be discontinued at any time.

The extent to which we repurchase shares of our Class A common stock under the repurchase plan, and the timing of any such repurchases, depends on a variety of factors including general business and market conditions and other corporate considerations.

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Open market repurchases will be structured to occur in conformity with the method, timing, price and volume requirements of Rule 10b-18 of the Exchange Act.

As of September 30, 2025, we had not made any repurchases of our Class A common stock.

Our primary long-term liquidity requirements relate to (i) costs for additional residential investments, including development properties, (ii) repayment of long-term debt and our revolving credit facility, (iii) capital expenditures, (iv) cash redemption requirements related to our Series A Preferred Stock, (v) cash requirements related to our Series A Preferred Stock Safeguard Policy, and (vi) Class A common stock repurchases under our stock repurchase plan.

We intend to finance our long-term liquidity requirements with net proceeds of additional issuances of common and preferred stock, including issuances in connection with the continuous registered offering of our Series A Preferred Stock, our revolving credit facility, as well as future acquisition or project-based borrowings.

As of March 31, 2026, we had not made any repurchases of our Class A common stock.

Our primary long-term liquidity requirements relate to (i) costs for additional residential investments, including development projects, (ii) repayment of long-term debt and our revolving credit facility, (iii) capital expenditures, and (iv) cash redemption requirements related to our Series A Preferred Stock and our Series B Preferred Stock, (v) cash requirements related to our Series A Safeguard Policy and our Series B Safeguard Policy, and (v) Class A common stock repurchases under our stock repurchase plan.

We intend to finance our long-term liquidity requirements with net proceeds of additional issuances of common and preferred stock, including issuances in connection with the continuous registered offering of our Series B Preferred Stock, our revolving credit facility, our DST Program, as well as future acquisition or project-based borrowings.

Our success in meeting these requirements will therefore depend upon our ability to access capital.

Further, our ability to access equity capital is dependent upon, among other things, general market conditions for REITs and the capital markets generally, market perceptions about us and our asset class, and current trading prices of our securities.

As we did in the nine months ended September 30, 2025, we may also selectively sell consolidated operating assets at appropriate times, which would be expected to generate cash sources for both our short-term and long-term liquidity needs.

Further, our ability to access equity capital is dependent upon, among other things, general market conditions for REITs and the capital markets in general, market perceptions about us and our asset class, and current trading prices of our securities.

As we did in the three months ended March 31, 2026, we may also selectively sell consolidated operating assets at appropriate times, which would be expected to generate cash sources for both our short-term and long-term liquidity needs.

We may also meet our long-term liquidity needs through borrowings from a number of sources, either at the corporate or project level.

We believe our revolving credit facility will serve as our primary debt source that will continue to enable us to deploy our capital more efficiently and provide capital structure flexibility as we grow our asset base.

In addition to restrictive covenants, our revolving credit facility contains material financial covenants.

At September 30, 2025, we were in compliance with all covenants under our revolving credit facility.

In October 2024, we entered into a credit agreement related to our DST Program with KeyBank National Association and a syndicate of other lenders which provides for a revolving loan with a maximum commitment amount of $50 million.

We believe this revolving credit facility will serve as our primary debt source that will continue to enable us to deploy our capital more efficiently and provide capital structure flexibility as we grow our asset base.

The revolving credit facility contains certain financial and operating covenants.

As of March 31, 2026, we were in compliance with all covenants under our credit facility.

We will continue to monitor the debt markets, including Fannie Mae and Freddie Mac, and as market conditions permit, access borrowings that are advantageous to us.

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We also may be forced to dispose of assets at inopportune times to maintain REIT qualification and Investment Company Act exemption.

We expect to maintain a distribution on our Series A Preferred Stock in accordance with the terms which require monthly dividends.

While our distributions through September 30, 2025 have been paid from cash flow from operations and in accordance with our policy, distributions in the future may be paid from cash flow from operations, proceeds from the offering of our Series A Preferred Stock, the sales of assets, and additional sources, such as from borrowings.

We have preferred equity interests in properties that are in various stages of development, in lease-up and operating, and our preferred equity investments are structured to provide a current and/or accrued preferred return during all phases.

We expect to maintain distributions paid on our Series A Preferred Stock and Series B Preferred Stock in accordance with the terms which require monthly dividends.

While our distributions through March 31, 2026 have been paid from cash flow from operations and in accordance with our policy, distributions in the future may be paid from cash flow from operations, proceeds from the offering of our Series B Preferred Stock, proceeds from the DST Program, the sales of assets, and additional sources, such as from borrowings.

We have preferred equity interests in properties that are in various stages of development and operating, and our preferred equity investments are structured to provide a current and/or accrued preferred return during all phases.

Each joint venture in which we own a preferred equity interest is required to redeem our preferred equity interests, plus any accrued preferred return, based on a fixed maturity date, generally in relation to the property’s construction loan or mortgage loan maturity.

Upon redemption of the preferred equity interests, our income, FFO, CFFO and cash flows could be reduced below the preferred returns currently being recognized.

Upon redemption of the preferred equity interests, our income, funds from operations (“FFO”), core funds from operations (“CFFO”) and cash flows could be reduced below the preferred returns currently being recognized.

Alternatively, if the joint ventures do not redeem our preferred membership interest when required, our income, FFO, CFFO and cash flows could be reduced if the development project does not produce sufficient cash flow to pays its operating expenses, debt service and preferred return obligations.

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Off-Balance Sheet Arrangements

As of September 30, 2025, we have off-balance sheet arrangements that may have a material effect on our financial condition, revenues or expenses, results of operations, liquidity, capital resources or capital expenditures.

At September 30, 2025, we hold preferred equity interests in five joint ventures that are accounted for as available-for-sale debt securities.

As of March 31, 2026, we have off-balance sheet arrangements that may have a material effect on our financial condition, revenues or expenses, results of operations, liquidity, capital resources or capital expenditures.

As of March 31, 2026, we entered into five joint venture agreements which are classified as available-for-sale debt securities.

Cash Flows from Operating Activities

As of September 30, 2025, we held twenty-two real estate investments, consisting of seventeen consolidated investments and five preferred equity investments, with the twenty-two investments representing an aggregate of 5,282 residential units.

During the nine months ended September 30, 2025, net cash provided by operating activities was $28.3 million after net loss of $23.1 million was adjusted for the following:

● distributions of income and income from preferred equity investments of $22.0 million;

● non-cash items of $20.3 million;

● an increase in accounts payable and other accrued liabilities of $8.2 million;

● an increase in due to affiliates of $1.8 million;

● a decrease in notes and accrued interest receivable of $0.5 million;

● distributions from investments in unconsolidated real estate funds of $0.3 million;

As of March 31, 2026, we held twenty-four real estate investments, consisting of eighteen consolidated investments, five preferred equity investments, and one unconsolidated real estate fund investment, with the twenty-three consolidated and preferred equity investments representing an aggregate of 5,451 residential units.

During the three months ended March 31, 2026, net cash used in operating activities was $8.5 million after net loss of $10.3 million was adjusted for the following:

● an increase in accounts receivable, prepaids and other assets of $5.1 million;

● a decrease in due to affiliates of $2.2 million;

● a decrease in accounts payable and other accrued liabilities of $0.8 million;

● non-cash items of $9.6 million;

● distributions of income from preferred equity investments of $0.3 million.

Cash Flows from Investing Activities

During the nine months ended September 30, 2025, net cash used in investing activities was $109.0 million, due to the following:

● $155.7 million used in the acquisition of real estate investments;

● $25.0 million used in an investment in an unconsolidated real estate fund;

● $13.7 million used on capital expenditures;

● $11.1 million used in investments in preferred equity investments;

● $1.6 million used in the purchase of rate caps;

● $49.6 million of proceeds from the sale and redemption of preferred equity investments;

● $31.7 million of repayments on notes receivable;

During the three months ended March 31, 2026, net cash provided by investing activities was $6.4 million due to the following:

● $20.7 million of proceeds from the sales of real estate investments;

● $7.8 million used in investments in preferred equity investments;

● $3.8 million used on capital expenditures;

● $2.7 million used in acquiring consolidated real estate investments.

Cash Flows from Financing Activities

During the nine months ended September 30, 2025, net cash provided by financing activities was $132.8 million, primarily due to the following:

● borrowings of $88.3 million on mortgages payable;

● $72.4 million of contributions from noncontrolling interests;

● proceeds of $42.0 million from borrowings on revolving credit facilities;

● net proceeds of $32.3 million from the issuance of shares of Series A Preferred Stock;

● $81.0 million of repayments on revolving credit facilities;

● $6.5 million of cash distributions paid to preferred stockholders;

During the three months ended March 31, 2026, net cash used in financing activities was $0.8 million due to the following:

● $12.3 million of repayments on mortgages payable;

● $3.6 million in deferred financing costs;

● $2.6 million of distributions to preferred stockholders;

● $2.2 million in cash distributions paid to partially owned properties’ noncontrolling interests;

● $1.1 million of distributions to noncontrolling interests;

● $1.2 million of distributions to partially owned properties’ noncontrolling interests;

● $1.1 million used in the purchase of interests from noncontrolling interests;

● $1.0 million of cash distributions paid to common stockholders;

● $0.5 million of distributions to common stockholders;

● $0.1 million paid for the redemption of Series A Preferred Stock;

● $11.7 million of contributions from noncontrolling interests;

● net proceeds of $4.2 million from the issuance of shares of Series A Preferred Stock;

● net proceeds of $2.1 million from the issuance of shares of Series B Preferred Stock.

Capital Expenditures

The following table summarizes our total capital expenditures for the nine months ended September 30, 2025 and 2024 (amounts in thousands):

Nine Months Ended

September 30,

The following table summarizes our total capital expenditures for the three months ended March 31, 2026 and 2025 (amounts in thousands):

Three Months Ended

New development

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Neither FFO nor CFFO should be considered as an alternative to net income, including net income (loss) attributable to common stockholders, as an indicator of our operating performance or as an alternative to cash flow from operating activities as a measure of our liquidity.

The table below presents our calculation of FFO and CFFO for the three and nine months ended September 30, 2025 and 2024 ($ in thousands):

The table below presents our calculation of FFO and CFFO for the three months ended March 31, 2026 and 2025 ($ in thousands):

Three Months Ended

Nine Months Ended

September 30,

Net (loss) income attributable to common stockholders

Net (loss) income attributable to Operating Partnership Units

Net (loss) income attributable to common stockholders and unit holders

Net loss attributable to common stockholders

Net loss attributable to Operating Partnership Units

Net loss attributable to common stockholders and unit holders

Real estate depreciation and amortization

Impairment and (gain on sale) of real estate investments, net

Gain on sale of available-for-sale investments

Impairment of real estate investments

Gain on sale of real estate investments, net

Adjustment for partially owned properties’ noncontrolling interests

3 unchanged sentences

Unrealized loss on derivatives

Provision for (recovery of) credit losses

Recovery of credit losses

Non-cash returns on unconsolidated real estate funds

Loss on extinguishment of debt costs

Weather-related losses, net

Loss on extinguishment of debt costs

Non-real estate depreciation and amortization

18 unchanged sentences

March 11, 2025

March 25, 2025

April 4, 2025

March 11, 2025

June 25, 2025

March 11, 2025

September 25, 2025

October 3, 2025

March 11, 2025

December 24, 2025

January 5, 2026

Class C common stock

March 10, 2026

1 unchanged sentence

April 2, 2026

March 11, 2025

June 25, 2025

March 11, 2025

September 25, 2025

October 3, 2025

Class C common stock

March 11, 2025

1 unchanged sentence

January 5, 2026

March 10, 2026

March 25, 2026

April 2, 2026

Series A Preferred Stock (1)

11 unchanged sentences

April 2, 2026

April 15, 2025

April 25, 2025

April 15, 2025

June 25, 2025

July 15, 2025

July 25, 2025

August 5, 2025

July 15, 2025

August 25, 2025

September 5, 2025

July 15, 2025

September 25, 2025

October 3, 2025

Series A Preferred Enhanced Special Dividend (2)

11 unchanged sentences

April 2, 2026

April 15, 2025

April 25, 2025

April 15, 2025

Series B Preferred Stock (1)

January 15, 2026

January 23, 2026

February 5, 2026

January 15, 2026

February 25, 2026

March 5, 2026

January 15, 2026

March 25, 2026

April 2, 2026

June 25, 2025

July 15, 2025

July 25, 2025

August 5, 2025

July 15, 2025

August 25, 2025

September 5, 2025

July 15, 2025

September 25, 2025

October 3, 2025

Holders of record of newly issued Series A Preferred Stock shares that are held only a portion of the applicable monthly dividend period will receive a prorated dividend based on the actual number of days in the applicable dividend period during which each such share of Series A Preferred Stock was outstanding.

Holders of record of newly issued Series A Preferred Stock shares and Series B Preferred Stock shares that are held only a portion of the applicable monthly dividend period will receive a prorated dividend based on the actual number of days in the applicable dividend period during which each such share of Series A Preferred Stock and Series B Preferred Stock was outstanding.

Holders of record of Series A Preferred Stock shares are entitled to an enhanced special dividend equal to the amount by which (i) the Stated Value of the Series A Preferred Stock multiplied by (a) the sum of (I) the average of the one-month Term SOFR for each day commencing on the 26 th of the prior month to the 25 th of the applicable month, plus (II) two percent, divided by (b) twelve, exceeds (ii) the standard monthly dividend of $0.125 per share of Series A Preferred Stock.

2 unchanged sentences

There is no assurance that we will continue to declare dividends or at this rate.

Holders of OP Units, LTIP Units and C-LTIP Units are entitled to receive “distribution equivalents” at the same time as dividends are paid to holders of our Class A common stock.

Holders of restricted stock, OP Units, LTIP Units and C-LTIP Units are entitled to receive “distribution equivalents” at the same time as dividends are paid to holders of our Class A common stock.

Our Board will determine the amount of dividends to be paid to our stockholders.

6 unchanged sentences

Subsequent Events

Other than the items disclosed in Note 18 “Subsequent Events” to our interim Consolidated Financial Statements for the period ended September 30, 2025, no material events have occurred that required recognition or disclosure in these financial statements.

Other than the items disclosed in Note 18 “Subsequent Events” to our interim Consolidated Financial Statements for the period ended March 31, 2026, no material events have occurred that required recognition or disclosure in these financial statements.

Refer to Note 18 of our interim Consolidated Financial Statements for discussion.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis