What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-13 compared with 2026-05-07 · 161 added, 95 removed, 424 unchanged (38% of the section changed)

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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 5,420 residential units, comprised of 4,271 consolidated units, of which 410 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;

As of June 30, 2026, our consolidated operating investments were approximately 90.2% occupied;

excluding units classified as held for sale and down/renovation units, our consolidated operating investments were approximately 92.3% occupied.

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Inflation and Related Economic Volatility

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.

During the first half of 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 first half of 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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Investment Activity Summary

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

Provided below is a summary of our investment activity during the six months ended June 30, 2026.

Parkside at Summers Corner

We acquired, with full ownership interest, an additional 40 units at Parkside at Summers Corner located in Summerville, South Carolina for an aggregate purchase price of $10.3 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.

Units are to be acquired in tranches as construction is completed, and as of June 30, 2026, we acquired 52 of the total 100 units we have committed to purchase.

Sale of Consolidated Operating Units

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35 units in the Ballast portfolio, 47 units in the Golden Pacific portfolio, 29 units in the ILE portfolio, 8 units in the Indy-Springfield portfolio, 31 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.

The 192 units, including 92 units classified as held for sale as of December 31, 2025, were all previously classified as held for sale and sold for an aggregate of approximately $39.8 million, subject to certain closing costs, prorations and adjustments typical in such real estate transactions.

After deducting the paydown of existing mortgage indebtedness encumbering 27 units in the ILE portfolio of approximately $3.8 million, the sales of the 192 units generated net proceeds of approximately $33.0 million and a gain on sales of approximately $0.9 million.

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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.

As of June 30, 2026, we funded $40.0 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 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).

As of June 30, 2026 and December 31, 2025, we classified an aggregate of 81 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 81 units classified as held for sale at June 30, 2026 are included in the following portfolios:

16 units of Ballast, 45 units of Golden Pacific, 8 units of ILE, 10 units of Indy-Springfield, and 2 units of Peak JV 2.

As of June 30, 2025, we classified an aggregate of 94 units as held for sale, with all units reported in our scattered single-family homes segment.

For the three and six months ended June 30, 2026 and 2025, we recorded impairments of $0.5 million and $0.1 million, and $1.1 million and $0.2 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.

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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”).

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.

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.

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.

As of June 30, 2026, we, at the request of holders, 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 58,855 shares of Series A Preferred Stock for $1.4 million in cash.

Series B Redeemable Preferred Stock

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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.

As of June 30, 2026, we issued 351,304 shares of Series B Preferred Stock pursuant to the Series B Preferred Offering with net proceeds of approximately $6.9 million after commissions, dealer manager fees, sales discounts and costs related to establishing the offering of Series B Preferred Stock.

As of June 30, 2026, we had not redeemed any shares of Series B Preferred Stock.

Stockholders’ Equity

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.

Our total stockholders’ equity decreased $7.8 million from $128.7 million as of December 31, 2025 to $120.9 million as of June 30, 2026.

The decrease in our total stockholders’ equity is primarily attributable to net loss attributable to common stockholders of $6.9 million and common stock dividends declared of $1.0 million.

Results of Operations

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

The following is a summary of our consolidated real estate investments as of June 30, 2026:

Excluding Held

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Total operating units includes an aggregate of 81 units classified as held for sale, with such units 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.

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.

16 units of Ballast, 45 units of Golden Pacific, 8 units of ILE, 10 units of Indy-Springfield, and 2 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 June 30, 2026.

Percent occupied is calculated as (i) the number of units occupied as of June 30, 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 June 30, 2026 divided by (ii) total number of units, expressed as a percentage, and excludes 81 units classified as held for sale and an aggregate of 8 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).

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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.

Percent occupied lower at Ballast and Golden Pacific due to units intentionally held vacant in preparation for sale.

Represents a development project with no units delivered as of June 30, 2026.

Abode Wendell Falls and Harmony at Clear Creek commenced construction in 2024 and 2026, respectively.

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,

Of the total 100 units that we have committed to acquire, 52 units had been acquired as of June 30, 2026.

Of the 52 units acquired, 19 units were occupied as of June 30, 2026.

The following is a summary of our consolidated operational results by reportable segment for the three and six months ended June 30, 2026 and 2025 ($ in thousands, except average rental rates):

Three Months Ended June 30,

Six Months Ended June 30,

Rental and other property revenues

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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 and loan investments as of March 31, 2026:

The following is a summary of our preferred equity investments as of June 30, 2026:

Total Actual /

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Cost Per Unit

Brunswick, GA

Sanford Marketplace

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Total Development Units

Lease-up Investment Name

Brunswick, GA

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 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.

None of the development investments had commenced lease-up as of June 30, 2026.

For development and lease-up 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 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.

Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025

Rental and other property revenues increased $2.6 million, or 16%, to $19.3 million for the three months ended June 30, 2026 as compared to $16.7 million for the same prior year period.

The increase was primarily due to:

(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.

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.

(i) the acquisition of 897 units at three residential communities, which was partially offset by sales of 280 single-family units in our portfolio since April 1, 2025.

We also benefitted from a 2.2% increase in average occupancy in our residential communities, which was 94.9% during the three months ended June 30, 2026, compared to 92.7% during the second quarter of 2025.

This was partially offset by a 5.9% decrease in average occupancy in our single-family homes, which was 84.6% during the three months ended June 30, 2026, compared to 90.5% during the second quarter of 2025.

The decrease in average occupancy in our single-family homes was lower due to units at Ballast and Golden Pacific intentionally held vacant in preparation for sale.

Interest income from loan investments amounted to zero for the three months ended June 30, 2026 as compared to $0.1 million for the same prior year period due to the full payoff of a loan investment in the second quarter of 2025.

Property operating expenses increased $1.6 million, or 20%, to $9.8 million for the three months ended June 30, 2026 as compared to $8.2 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 280 single-family units in our portfolio since April 1, 2025.

Property management and asset management fee expenses were $1.3 million for the three months ended June 30, 2026 as compared to $1.3 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 $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.

General and administrative expenses amounted to $2.5 million for the three months ended June 30, 2026 as compared to $2.7 million for the same prior year period.

Of the $2.5 million total expense in the second quarter 2026, $1.5 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 June 30, 2026 as compared to $2.6 million for the same prior year period.

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

For the second 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 $0.6 million for the three months ended June 30, 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

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.

Weather-related losses amounted to $0.2 million for the three months ended June 30, 2026 as compared to less than $0.1 million for the same prior year period.

The 2026 expense relates to damage at two of our scattered single-family home investments.

Impairment of real estate investments amounted to $0.5 million for the three months ended June 30, 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.

Impairment amounts recorded during the three months ended June 30, 2026 and 2025 relate to held for sale single-family units.

Depreciation and amortization expenses were $7.9 million for the three months ended June 30, 2026 as compared to $7.2 million for the same prior year period, with the increase primarily due to the acquisition of two residential communities since the second quarter of 2025.

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

Other Income and Expense

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.

Other income and expense amounted to expense of $2.8 million for the three months ended June 30, 2026 as compared to income of $0.2 million for the same prior year period.

This was primarily due a $1.5 million gain on the sale of one preferred equity investment during the second quarter of 2025 and a decrease of $0.6 million in gain on sales of real estate investment from the second quarter of 2025.

In addition, during the second quarter of 2026 we had increased interest expense of $0.9 million.

Income Tax Expense

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.

Income tax expense amounted to zero for the three months ended June 30, 2026 as compared to $0.6 million for the same prior year period.

The decrease was primarily due to lower income tax expense related to our preferred equity investments.

Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025

Rental and other property revenues increased $6.4 million, or 20%, to $39.0 million for the six months ended June 30, 2026 as compared to $32.6 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 319 single-family units in our portfolio since January 1, 2025.

We also benefitted from a 1.5% increase in average occupancy in our residential communities, which was 94.9% during the six months ended June 30, 2026, compared to 93.4% during the same prior year period.

This was partially offset by a 4.2% decrease in average occupancy in our single-family homes, which was 86.0% during the six months ended June 30, 2026, compared to 90.2% during the same prior year period.

The decrease in average occupancy in our single-family homes was lower due to units at Ballast and Golden Pacific intentionally held vacant in preparation for sale.

Interest income from loan investments amounted to zero for the six months ended June 30, 2026 as compared to $0.6 million for the same prior year period due to the full payoff of two loan investments in early-2025.

Property operating expenses increased $3.1 million, or 19%, to $18.9 million for the six months ended June 30, 2026 as compared to $15.8 million for the same prior year period.

The was primarily due to the acquisition of 897 units at three residential communities, which was partially offset by sales of 319 single-family units in our portfolio since January 1, 2025.

Property management and asset management fee expenses were $2.9 million for the six months ended June 30, 2026 as compared to $2.7 million in the same prior year period.

General and administrative expenses amounted to $5.6 million for the six months ended June 30, 2026 as compared to $5.7 million for the same prior year period.

Of the $5.6 million total expense for the six months ended June 30, 2026, $3.6 million related to direct costs incurred by us, while the remaining $2.0 million related 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 $5.4 million for the six months ended June 30, 2026 as compared to $5.1 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 Stock Offerings.

For the six months ended June 30, 2026, we will pay $0.4 million of the base management fee in C-LTIP Units with the remainder in cash.

Acquisition and other transaction costs amounted to $0.6 million for the six months ended June 30, 2026 compared to $0.2 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.

Weather-related losses amounted to $0.4 million for the six months ended June 30, 2026 compared to less than $0.1 million for the same prior year period.

The 2026 expenses relates to damage at three of our scattered single-family home investments and one residential community.

Impairment of real estate investments amounted to $1.1 million for the six months ended June 30, 2026 compared to $0.2 million for the same prior year period.

Depreciation and amortization expenses were $16.7 million for the six months ended June 30, 2026 as compared to $14.7 million for the same prior year period, with the increase primarily due to higher depreciation expense and amortization of in-place lease costs at two residential communities that were acquired since June 30, 2025, offset by lower amortization of in-place lease costs at two residential communities that had expense in the prior year and none in the current year.

Other Income and Expense

Other income and expense amounted to expense of $6.6 million for the six months ended June 30, 2026 as compared to expense of $0.9 million for the same prior year period.

This was primarily due to a decrease in preferred returns of $1.9 million as investments in our preferred equity investments decreased to $55.6 million at June 30, 2026 as compared to $60.7 million at June 30, 2025 due to the redemption and/or sale of five preferred equity investments partially offset by two new preferred equity investments.

In addition, during the six months ended June 30, 2026 we had increased interest expense of $1.1 million compared to the prior year period and during the six months ended June 30, 2025 we recorded a $1.5 million gain on the sale of one preferred equity investment.

Income Tax Expense

Income tax expense amounted to $0.1 million for the six months ended June 30, 2026 as compared to $1.0 million for the same prior year period.

The decrease was primarily due to lower income tax expense related to our preferred equity investments.

Net Operating Income

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Three Months Ended

Six Months Ended

Net loss attributable to common stockholders

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Gain on sale of real estate investments, net

Gain on sale of available-for-sale investments

Total property income

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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, 2025 as filed with the SEC on February 27, 2026.

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.

While consolidated occupancy excluding units classified as held for sale and down/renovation units remains strong at 92.3% as of June 30, 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”).

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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 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.

As of June 30, 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 $149.8 million, issued demand notes of $2.3 million, and had $305.8 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 June 30, 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.

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

● $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;

● $172.1 million in cash available at June 30, 2026;

● capacity of $50 million on the revolving credit facility, all of which was available as of June 30, 2026 for use in our DST Program;

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

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● 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.

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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.

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.

As of June 30, 2026, we had contractual commitments to fund future cash obligations in certain of our preferred equity investments in the aggregate of $8.8 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 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.

As of June 30, 2026, we estimate that the remaining costs associated with the completion of construction for these two residential communities will be approximately $107.9 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.

We expect acquisitions to occur in tranches as construction is completed, and as of June 30, 2026, 48 units remain to be acquired, representing an aggregate purchase price of $12.3 million.

During the second quarter of 2026, two of our scattered single-family home portfolios incurred weather-related losses related to hailstorms in Illinois and Missouri.

An assessment of the damage is ongoing.

As of June 30, 2026, we expect that the total cost to repair all damage, which primarily includes roof and siding replacement, will be approximately $1.5 million, of which $0.2 million was incurred and recognized during the second quarter.

A portion of the future costs are expected to be recognized as repair costs in weather-related losses with the remainder capitalized within buildings and improvements.

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

As of June 30, 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.

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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.

As we did in the six months ended June 30, 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.

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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.

As of June 30, 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 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.

While our distributions through June 30, 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.

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Off-Balance Sheet Arrangements

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.

As of June 30, 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 June 30, 2026, we entered into five joint venture agreements which are classified as available-for-sale debt securities.

Cash Flows from Operating Activities

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:

As of June 30, 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 5,420 residential units.

During the six months ended June 30, 2026, net cash used in operating activities was $5.7 million after net loss of $19.3 million was adjusted for the following:

● an increase in accounts receivable, prepaids and other assets of $3.2 million;

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

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

● an increase in due from affiliates of $2.4 million;

● non-cash items of $17.6 million;

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

● an increase in accounts payable and other accrued liabilities of $1.1 million;

● distributions from investments in unconsolidated real estate funds of $0.5 million.

Cash Flows from Investing Activities

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;

During the six months ended June 30, 2026, net cash used in investing activities was $3.4 million due to the following:

● $19.7 million used in investments in preferred equity investments;

● $10.7 million used in the acquisition of real estate investments;

● $9.1 million used on capital expenditures;

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

● $0.7 million used on the purchase of rate caps;

● $36.8 million of proceeds from the sales of real estate investments.

Cash Flows from Financing Activities

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

During the six months ended June 30, 2026, net cash provided by financing activities was $9.4 million due to the following:

● $19.9 million of contributions from noncontrolling interests;

● borrowings of $19.2 million on mortgages payable;

● net proceeds of $7.4 million from the issuance of shares of Series B Preferred Stock;

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

● $26.5 million of repayments on mortgages payable;

● $2.6 million of distributions to preferred stockholders;

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

● $5.3 million of cash distributions paid to preferred stockholders;

● $4.8 million of distributions to partially owned properties’ noncontrolling interests;

● $2.3 million of distributions to noncontrolling interests;

● $0.5 million of distributions to common stockholders;

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

● $0.6 million in deferred financing costs;

● $0.5 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.

● $0.3 million for shares withheld for employee taxes upon vesting of awards.

Capital Expenditures

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

Three Months Ended

The following table summarizes our total capital expenditures for the six months ended June 30, 2026 and 2025 (amounts in thousands):

Six 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 months ended March 31, 2026 and 2025 ($ in thousands):

The table below presents our calculation of FFO and CFFO for the three and six months ended June 30, 2026 and 2025 ($ in thousands):

Three Months Ended

Six Months Ended

Net loss attributable to common stockholders

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Gain on sale of real estate investments, net

Gain on sale of available-for-sale investments

Adjustment for partially owned properties’ noncontrolling interests

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Non-cash returns on unconsolidated real estate funds

Weather-related losses, net

Loss on extinguishment of debt costs

Weather-related losses, net

Non-real estate depreciation and amortization

Other expense (income), net

Other expense, net

Non-cash equity compensation

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April 2, 2026

June 12, 2026

June 25, 2026

Class C common stock

5 unchanged sentences

April 2, 2026

June 12, 2026

June 25, 2026

Series A Preferred Stock

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April 2, 2026

April 13, 2026

April 24, 2026

April 13, 2026

June 25, 2026

Series A Preferred Enhanced Special Dividend (1)

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April 2, 2026

April 13, 2026

April 24, 2026

April 13, 2026

June 25, 2026

Series B Preferred Stock (2)

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April 2, 2026

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.

April 13, 2026

April 24, 2026

April 13, 2026

June 25, 2026

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.

The enhanced special dividend will be aggregated with the standard monthly dividend so as to effect a dividend rate on the Series A Preferred Stock that is subject to a 6.5% minimum and 8.5% maximum annual rate.

Holders of record of newly issued 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 B Preferred Stock was outstanding.

A portion of each dividend may constitute a return of capital for tax purposes.

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Subsequent Events

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.

Other than the items disclosed in Note 18 “Subsequent Events” to our interim Consolidated Financial Statements for the period ended June 30, 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