CaliberCos Inc. 10-K

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report on Form 10-K. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from these forward-looking statements as a result of certain factors. For a complete discussion of such risk factors, see the section in this report entitled “Risk Factors”. Overview Over the past 16 years, we have grown into a leading diversified alternative asset management firm, with more than $2.6 billion in Managed Assets, comprised of $0.8 billion of AUM and $1.9 billion of AUD. Our primary goal is to drive shareholder value by enhancing the wealth of the accredited investor clients seeking to make investments in real and digital assets. Management evaluates our business based on (i) recurring fee-related earnings, (ii) growth in embedded performance allocations within our managed funds, and (iii) the strategic accumulation and yield generation from digital asset holdings. Because performance allocations are recognized under U.S. GAAP only when they are no longer probable of significant reversal (generally upon realization events), U.S. GAAP results may not reflect the economic progress of carried interest value creation within our managed portfolio at a given reporting date. Digital Asset Platform In August 2025, our Board of Directors approved our Treasury Reserve Policy designed to support our balance sheet strategy, liquidity profile, and long-term growth initiatives. Under this policy, we allocate a portion of our corporate treasury to digital assets that we believe demonstrate institutional utility and adoption potential, beginning with LINK. LINK is the decentralized oracle network intended to enable smart contracts and traditional systems to securely interact with real-world data. We selected LINK as our initial digital asset holding based on management’s assessment of its core role in blockchain infrastructure supporting the growth of tokenization, decentralized finance, and real-world asset integration. Management believes that LINK’s enterprise adoption, technology maturity, and network resilience make LINK an attractive long-term holding relative to other digital assets at similar stages of adoption. Since adoption of the policy, we have raised capital through equity issuances and deployed a portion of those proceeds to accumulate LINK as a long-term treasury asset. These holdings are reflected on our consolidated balance sheets at fair value as of December 31, 2025. Changes in the fair value of our LINK are reflected in our consolidated statements of operations for the year ended December 31, 2025. We expect continued volatility in the fair value of our digital asset holdings, which may materially affect reported results in future periods. We have announced our intention to stake a portion of our LINK holdings once operational readiness and governance requirements are completed. Staking generally involves committing tokens to participate in network security and may generate a yield in the form of additional LINK tokens. Staking is a critical part of the LINK ecosystem and provides an opportunity for us to generate passive yield on its holdings while contributing to the stability and reliability of the broader network. Management estimates it may earn a yield of 3% to 9% annualized, based upon internal estimates of the potential to stake our LINK treasury. Any staking yield is subject to protocol rules, market conditions, operational factors and regulatory considerations. Actual results may differ materially from expectations. In parallel, we are evaluating the potential to operate or participate in LINK validator-related activities, which could include third party arrangements or internal capabilities. Validator-related activities play a central role in maintaining network consensus and facilitating data integrity. Revenues generated from staking or related activities, if any, would be evaluated by management in the context of our liquidity, balance sheet strategy and capital allocation within our digital asset treasury and asset management platform business. We may consider additional products or investment offerings over time that provide exposure to digital assets or blockchain infrastructure, subject to market conditions, regulatory considerations, and investor demand. These future offerings could expand our AUM and generate recurring management and performance fees, consistent with our existing real estate fund model. Additionally, we are evaluating potential applications of blockchain technology within our real estate investment platform, which could include processes intended to improve operational efficiency, investor servicing and investor accessibility. Specifically, we intend to tokenize real-world assets, including real estate projects and fund interests, to enable fractional ownership, enhance 39 Table of Contents liquidity, and streamline investor reporting and fund administration. Tokenized offerings could also serve as a new fundraising channel for us, allowing us to reach a broader base of global investors through compliant, blockchain-enabled investment vehicles. The Board of Directors and management team view the LINK strategy and broader blockchain initiatives as a natural evolution of our mission: to enhance the wealth of our accredited investor clients by making alternative investments more accessible, transparent, and profitable for investors. Through the integration of digital assets, blockchain infrastructure and tokenization technology, we seek to position ourself at the forefront of the convergence between traditional finance and decentralized finance. Private Equity Real Estate Platform We operate a Private Equity Real Estate (“PERE”) platform that creates, manages, and services middle-market investment funds, private syndications, and direct investments focused on real estate investment strategies. To built our funds, we market directly to high net worth and ultra high net worth investors with our in-house fundraising team to registered investment advisors and broker-dealers with our in-house wholesaling team. We have a number of development, redevelopment, construction, and entitlement projects that are underway or are in the planning stages, which we define as AUD. This category includes projects to be build on underdeveloped land and projects to be built and constructed on undeveloped lands, some of which are on land owned by our funds or are under contract to purchase. Completing these development activities may ultimately result in income-producing assets, assets we may sell to third parties, or both. As of December 31, 2025, we are actively developing 1,796 multifamily units, 697 single family units, 3.7 million square feet of commercial and industrial, and 3.5 million square feet of office and retail. If all of these projects are brought to completion, the total cost capitalized to these projects, which represents total current estimated costs to complete the development and construction of such projects by us or a third party, is $1.9 billion, which we expect would be funded through a combination of undeployed fund cash, third-party equity, project sales, tax credit financing and similar incentives, and secured debt financing. We strive to provide investors attractive risk-adjusted returns by offering a balance of (i) structured offerings and ease of ownership, (ii) a pipeline of investment opportunities, primarily projects that range in value between $5.0 million and $50.0 million, and (iii) an integrated execution and processing platform. Our investment strategy leverages the local market intelligence and real-time data we gain from our operations to evaluate current investments, generate proprietary transaction flow, and implement various asset management strategies. As an alternative asset manager, we offer a full suite of support services and employ a vertically integrated approach to investment management. Our asset management activities are complemented with transaction and advisory services including development and construction management, acquisition and disposition expertise, and fund formation, which we believe differentiate us from other asset management firms. We earn the following fees from providing these services under the Platform: Asset Management Revenues • Fund management fees are generally based on 1.0% to 1.5% of the unreturned capital contributions in a particular fund and include reimbursement for costs incurred on behalf of the fund, including an allocation of certain overhead costs. These customer contracts require us to provide management services, representing a performance obligation that we satisfy over time. With respect to CHT, we earn a fund management fee of 0.7% of CHT’s enterprise value and is reimbursed for certain costs incurred on behalf of CHT. • Organizational & Offering fees include fund set-up fees and are a one-time fee earned during the initial formation, administration, and set-up of fund products we distribute and manage. These fees are recognized at the point in time when the performance under the contract is complete. • Financing fees are earned for services we perform in securing third-party financing on behalf of our private equity real estate funds. These fees are recognized at the point in time when the performance under the contract is complete, which is essentially upon closing of a loan. In addition, we earn fees for guaranteeing certain loans, representing a performance obligation that we satisfy over time. • Real estate development revenues are generally based on two fee-based contracts, not to exceed 6.0%. The first, a real estate development contract that provides for up to 4.0% of the total expected costs of the development and is paid for services performed by Caliber Development, LLC as the principal developer of our projects. These services may include 40 Table of Contents obtaining new entitlements or zoning changes and managing and supervising third-party developers. The second, a construction management contract that provides for up to 4.0% of the total expected costs of the construction project for services provided managing general contractors with respect to the construction of the properties owned by the funds. Prior to the commencement of construction, development fee revenue is recognized at a point in time as the related performance obligations are satisfied and the customer obtains control of the promised service, including negotiation, due diligence, entitlements, planning, and design activities. During the construction period, construction management fee revenue is recognized over time as the performance obligations are satisfied. • Brokerage fees are earned at a point in time at fixed rates for services performed related to acquisitions, dispositions, leasing, and financing transactions. Estimated Performance Allocations Performance allocations are foundational to our long-term economic model. As of December 31, 2025, based on internal asset-level business plans and projected exit assumptions, we estimate aggregate unrealized performance allocations of approximately $104.0 million. This estimate represents our contractual share of projected profits after satisfaction of preferred returns and return of capital. The estimate is derived from: • Asset-level discounted cash flow analyses • Underwriting models used for capital allocation decisions • Valuation methodologies consistent with fair value measurement frameworks • Independent third-party valuation work • Review procedures performed by our external auditors when applicable Assets that are impaired, or where current projections do not support achieving returns above the preferred return threshold, are assigned zero carried interest value and are excluded from the $104.0 million estimate unless and until business plan revisions support a reasonable expectation of future performance allocation realization. Consistent with U.S. GAAP, the $104.0 million of estimated unrealized performance allocations is not reflected in our consolidated financial statements. Management believes disclosure of unrealized performance allocations provides important insight into embedded economic value and long-term earnings potential. Sensitivity of Estimated Performance Allocations The performance allocation estimate is sensitive to changes in projected exit values of underlying assets. A 5% increase or decrease in projected exit values across the managed portfolio would result in an approximate $5.2 million increase or decrease in estimated performance allocations. Actual realized performance allocations may differ materially from current estimates based on changes in market conditions, operating performance, financing availability, or timing of realization events. Segments Our chief operating decision maker (“CODM”) is our Chief Executive Officer, John C. Loeffler. The CODM assesses revenue, operating expenses and key operating statistics to evaluate performance and allocate resources on a basis that eliminates the impact of the consolidated investment funds (intercompany eliminations required by U.S. GAAP) and noncontrolling interests. Management concluded that the consolidated investment funds do not meet the requirements in ASC 280, Segment Reporting, of operating segments, as our CODM does not review the operating results of these investment funds for the purposes of allocating resources, assessing performance or determining whether additional investments or advances will be made to these funds. The investment funds are consolidated based on the requirement in ASC 810, Consolidation, as we were determined to be the primary beneficiary of each of these variable interest entities since it has the power to direct the activities of the entities and the right to absorb losses, generally in the form of guarantees of indebtedness that are significant to the individual investment funds. 41 Table of Contents We were originally founded as Caliber Companies, LLC, an Arizona limited liability company, organized under the laws of Arizona, and commenced operations in January 2009. In November 2014, we reorganized as a Nevada corporation and in June 2018, we reincorporated in the state of Delaware. On our website we make available, free of charge, information about us and our investments. None of the information on our website is deemed to be part of this report. Trends Affecting Our Business Our business is driven by trends which affect the following: 1) Capital formation: any trend which increases or decreases investors’ knowledge of alternative investments, desire to acquire them, access to acquire them, and knowledge and appreciation of us as a potential provider, will affect our ability to attract and raise new capital. Capital formation also drives investment acquisitions, which contributes to our revenues. 2) Investment acquisition: any trend which increases or decreases the supply of middle-market real estate projects or loans, the accessibility of developments or development incentives, or enhances or detracts from our ability to access those projects will affect our ability to generate revenue. Coincidentally, investment acquisitions, or the rights to acquire an investment, drive capital formation, which acts as a growth engine for the Platform. 3) Project execution: any trend which increases or decreases the costs of execution on a real estate project, including materials pricing, labor pricing, access to materials, delays due to governmental action, and the general labor market, will affect our ability to generate revenues. Our business depends in large part on our ability to raise capital for our funds from investors. Since our inception, we have continued to successfully raise capital into our funds with our total capital raised through December 31, 2025 of $769.3 million. Our success at raising new capital into our funds is impacted by the extent to which new investors see alternative assets as a viable option for capital appreciation and/or income generation. Since our ability to raise new capital into our funds is dependent upon the availability and willingness of investors to direct their investment dollars into our products, our financial performance is sensitive in part to changes in overall economic conditions that affect investment behaviors. The demand from investors is dependent upon the type of asset, the type of return it will generate (current cash flow, long-term capital gains, or both) and the actual return earned by our fund investors relative to other comparable or substitute products. General economic factors and conditions, including the general interest rate environment and unemployment rates, may affect an investor’s ability and desire to invest in real estate. For example, a significant interest rate increase could cause a projected rate of return to be insufficient after considering other risk exposures. Additionally, if weakness in the economy emerges and actual or expected default rates increase, investors in our funds may delay or reduce their investments; however, we believe our approach to investing and the capabilities that we manage throughout the deal cycle will continue to offer an attractive value proposition to investors. While we have had historical successes, there can be no assurance that fundraising for our new and existing funds will experience similar success. If we were unable to raise such capital, we would be unable to deploy such capital into investments, which would materially reduce our revenues and cash flow and adversely affect our financial condition. We remain confident about our ability to find, identify, and source new investment opportunities that meet the requirements and return profile of our investment funds despite headwinds associated with increased asset valuations, competition and increased overall cost of credit. We continue to identify strategic acquisitions on off-market terms and anticipate that this trend will continue. We are at a point in our investment cycle where some of our funds have begun to exit significant parts of their portfolios while other are approaching a potential harvesting phase. We have complemented these cycles with other newer funds that will maintain management fees while providing continued sources of activity. Acquiring new assets includes being able to negotiate favorable loans on both a short and long-term basis. We strive to forecast and project our returns using assumptions about, among other things, the types of loans that we might expect the market to extend for a particular type of asset. This becomes more complex when the asset also requires construction financing. We may also need to refinance existing loans that are due to mature. Factors that affect these arrangements include the interest rate and economic environment, the estimated fair value of real property, and the profitability of the asset’s historical operations. These capital market conditions may affect the renewal or replacement of our credit agreements, some of which have maturity dates occurring within the next 12 months. Obtaining such financing is not guaranteed and is largely dependent on market conditions and other factors. The advancement of real estate investment-oriented technology, sometimes referred to as “proptech”, offers us the benefit of new and innovative technologies to better execute on capital formation strategies, investment acquisition strategies, and investment 42 Table of Contents management strategies. In recent years, we have added to our technology stack with systems that we believe lead the market in their specific ability to enhance execution on our projects. Several of these technologies seek to incorporate investments in artificial intelligence, which we believe will be a prevailing trend in helping us to enhance our project execution going forward. Regional conflicts and instability, such as those in Israel, Ukraine, and Iran can have significant impacts on global markets and economies and investor perception and tolerance for risk. These conflicts could lead to increased volatility in financial markets, disrupt supply chains, and change investor appetite for investments in alternative assets. Business Environment Global markets are experiencing significant volatility driven by concerns over inflation, elevated interest rates, global tariffs, slowing economic growth and geopolitical uncertainty. The annual inflation rate in the United States increased to 9.1% in June 2022, the highest rate since November 1981, but decreased to 2.7% in December 2025. As a result, from January 1, 2022 through September 18, 2024, the Federal Reserve increased the federal funds rate by 525 basis points. Subsequently, the Federal Reserve decreased the federal funds rate by 169 basis points through December 31, 2025, resulting in a target rate range of 3.50% to 3.75% at December 31, 2025. The rising interest rates, coupled with periods of significant equity and credit market volatility may potentially make it more difficult for us to find attractive opportunities for our funds to exit and realize value from their existing investments. Historically, inflation has tended to favor new capital formation for our funds, as investors seek opportunities that can hedge against rising costs, such as real estate investments. In addition, the increase in interest rates has put pressure on owners of existing real estate to sell assets as their loans mature. Combined with a shrinking pool of buyers, the commercial and residential real estate markets in our favored geographies are moving away from a seller’s market and closer to a buyer’s market. It remains to be seen if a stressed or distressed market may emerge, similar to our early years of operations. In both a buyer’s market and a stressed or distressed market, we expect our business model to outperform, as our direct access to investor capital and our ability to invest in a variety of asset classes allows us to move with the market and take advantage of potentially attractive prices. For project execution, inflation has increased the cost of nearly all building materials and labor types, increasing the cost of construction and renovation of our funds’ assets. On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted, resulting in significant and lasting changes to the Qualified Opportunity Zone (“QOZ”) program. Most notably, the OBBBA eliminates the program’s original sunset date of December 31, 2026, and extends the QOZ program indefinitely. This legislative change could potentially impact our real estate investment strategy, particularly for our funds with existing or future exposure to QOZ-designed assets. We are actively evaluating the potential long-term implications of the OBBBA, including increased investor demand for QOZ-aligned strategies and shifts in capital deployment across target markets. However, the full scope and operational impact of these changes remain subject to further guidance. Accordingly, there can be no assurance that the legislative changes will lead to improved fund performance or investor outcomes. We will continue to monitor developments and adjust its strategies as appropriate to align with the evolving QOZ landscape. Key Financial Measures and Indicators Our key financial measures are discussed in the following pages. Additional information regarding these key financial measures and our other significant accounting policies can be found in Note 2 – Summary of Significant Accounting Policies in the notes to our accompanying consolidated financial statements included herein. Total Revenue We generate the majority of our revenue in the form of asset management fee revenues and performance allocations. Included within our consolidated results, are the related revenues of certain consolidated VIEs. Total Expenses Total expenses include operating costs, general and administrative, marketing and advertising and depreciation and amortization. Included within our consolidated results, are the related expenses of consolidated VIEs. Other (Expense) Income Other (expense) income include interest expense, interest income, and change in fair value of digital assets. 43 Table of Contents Results of Operations Comparison of the Consolidated Results of Operations for the Years Ended December 31, 2025 and 2024 Our consolidated results of operations are impacted by the timing of consolidation, deconsolidation, and operating performance of our consolidated and previously consolidated funds. Periods presented may not be comparable due to the consolidation or deconsolidation of certain funds. In particular, we deconsolidated DoubleTree by Hilton Tucson Convention Center during the year ended December 31, 2024, and we deconsolidated Caliber Hospitality, LP, CHT and their consolidated subsidiaries, Elliot, DT Mesa, and CFIF III, during the year ended December 31, 2025. The following table and discussion provide insight into our consolidated results of operations for the years ended December 31, 2025 and 2024 (in thousands): Years Ended December 31, 2025 2024 $ Change % Change Revenues Asset management revenues $ 14,391 $ 16,879 $ (2,488) (14.7) % Performance allocations 27 358 (331) (92.5) % Consolidated funds – hospitality revenues 5,057 26,476 (21,419) (80.9) % Consolidated funds – other revenues 622 7,406 (6,784) (91.6) % Total revenues 20,097 51,119 (31,022) (60.7) % Expenses Operating costs 13,848 23,939 (10,091) (42.2) % General and administrative 5,755 6,776 (1,021) (15.1) % Marketing and advertising 796 751 45 6.0 % Depreciation and amortization 664 593 71 12.0 % Consolidated funds – hospitality expenses 4,743 26,503 (21,760) (82.1) % Consolidated funds – other expenses 1,865 5,870 (4,005) (68.2) % Total expenses 27,671 64,432 (36,761) (57.1) % Other expense, net (3,304) (3,093) (211) 6.8 % Change in fair value of digital assets (5,793) — (5,793) N/A Interest income 356 360 (4) (1.1) % Interest expense (6,712) (5,424) (1,288) 23.7 % Net loss before income taxes (23,027) (21,470) (1,557) 7.3 % Provision for income taxes — — — N/A Net loss (23,027) (21,470) (1,557) 7.3 % Net loss attributable to noncontrolling interests (1,229) (1,693) 464 (27.4) % Net loss attributable to CaliberCos Inc. $ (21,798) $ (19,777) $ (2,021) 10.2 % For the years ended December 31, 2025 and 2024, total revenues were $20.1 million and $51.1 million, respectively, representing a period-over-period decrease of 60.7%. This decrease was primarily due to a decrease in consolidated fund revenues as a result of the deconsolidation of CHT and Caliber Hospitality, LP and its consolidated subsidiaries, Elliot, DT Mesa, and CFIF III, which were deconsolidated during the year ended December 31, 2024 and TCC, which was deconsolidated during the year ended December 31, 2025. See the Segment Analysis section below in which revenues are presented on a basis that deconsolidates our consolidated funds. As a result, segment revenues are different than those presented on a consolidated basis in accordance with U.S. GAAP, because these fees are eliminated in consolidation when they are derived from a consolidated fund. For the years ended December 31, 2025 and 2024, total expenses were $27.7 million and $64.4 million, respectively, representing a period-over-period decrease of 57.1%. The decrease was primarily due to a decrease in consolidated fund expenses as a result of the deconsolidation of CHT and Caliber Hospitality, LP and its consolidated subsidiaries, Elliot, DT Mesa, and CFIF III, which were deconsolidated during the year ended December 31, 2024 and TCC, which was deconsolidated during the year ended December 31, 2025. 44 Table of Contents For the year ended December 31, 2025, change in fair value of digital assets was $(5.8) million. During the year ended December 31, 2025, we had investments in digital assets resulting in an unrealized loss. There was no comparable activity during the same period in 2024. Comparison of the Platform (Unconsolidated) Results of Operations for the Years Ended December 31, 2025 and 2024 The following table and discussion provide insight into our unconsolidated results of operations of the Platform for the years ended December 31, 2025 and 2024 (in thousands). Years Ended December 31, 2025 2024 $ Change % Change Revenues Asset management revenues $ 15,155 $ 20,563 $ (5,408) (26.3) % Performance allocations 33 379 (346) (91.3) % Total revenues 15,188 20,942 (5,754) (27.5) % Expenses Operating costs 14,455 24,904 (10,449) (42.0) % General and administrative 5,796 6,817 (1,021) (15.0) % Marketing and advertising 795 751 44 5.9 % Depreciation and amortization 691 598 93 15.6 % Total expenses 21,737 33,070 (11,333) (34.3) % Other loss, net (2,533) (2,654) 121 (4.6) % Change in fair value of digital assets (5,793) — (5,793) N/A Interest income 357 559 (202) (36.1) % Interest expense (6,712) (5,424) (1,288) 23.7 % Net loss before income taxes (21,230) (19,647) (1,583) 8.1 % Provision for income taxes — — — N/A Net loss $ (21,230) $ (19,647) $ (1,583) 8.1 % For the years ended December 31, 2025 and 2024, total revenues were $15.2 million and $20.9 million, respectively, representing a period-over-period decrease of 27.5%. The table below (in thousands) compares the revenues earned for providing services under the Platform as described in the Revenue Recognition section of Note 2 – Summary of Significant Accounting Policies for the year ended December 31, 2025, to the revenues earned for the same period in 2024. Years Ended December 31, 2025 2024 $ Change % Change Fund management fees $ 11,281 $ 12,318 $ (1,037) (8.4) % Financing fees 643 650 (7) (1.1) % Development and construction fees 2,442 6,751 (4,309) (63.8) % Brokerage fees 789 844 (55) (6.5) % Total asset management 15,155 20,563 (5,408) (26.3) % Performance allocations 33 379 (346) (91.3) % Total Platform revenue $ 15,188 $ 20,942 $ (5,754) (27.5) % The decrease in fund management fees is primarily due to a decrease in organizational and offering fees as there were no new funds created during the year ended December 31, 2025, as compared to the three funds created during the same period in 2024. 45 Table of Contents Fund management fees are based on a combination of 1.0% to 1.5% of the unreturned capital contributions in each fund and 0.7% of CHT’s enterprise value. The decrease in development and construction fees is primarily due to a decrease in development activities, specifically, a decrease in pre-construction milestones reached in the period. During the year ended December 31, 2025, we completed 11 milestones as compared to 30 milestones during the same period in 2024. For the years ended December 31, 2025 and 2024, total expenses were $21.7 million and $33.1 million, respectively, representing a period-over-period decrease of 34.3%. The decrease was primarily due to a decrease in operating costs related to payroll and payroll related expenses from our cost reduction efforts and a decrease in bad debt expense. For the year ended December 31, 2025, change in fair value of digital assets was $5.8 million. During the year ended December 31, 2025, our DAT strategy investment in LINK tokens generated a loss due to a decline in the spot price of our token which was part of a broader market correction in digital tokens and assets. There was no comparable activity during the same period in 2024. Balance Sheets - Platform (Unconsolidated) The following table and discussion provide insight into our unconsolidated balance sheets of the asset management Platform for the years ended December 31, 2025 and 2024. Unconsolidated assets, liabilities and stockholders’ equity are presented on a basis that deconsolidates our consolidated funds (intercompany eliminations). Total assets, total liabilities, and total stockholders’ equity are different than those presented on a consolidated basis in accordance with U.S. GAAP, because certain accounts (including notes receivable, due from/to related parties, and investments in unconsolidated entities) are eliminated in consolidation when they are due from/to consolidated funds. Furthermore, we are required to add to this balance sheet, assets and liabilities and equity of the consolidated funds which are items that are not available to a shareholder of CWD. See the Non-GAAP Measures section below for reconciliations of the unconsolidated results to the most comparable U.S. GAAP measure. 46 Table of Contents December 31, 2025 December 31, 2024 (in thousands) ASSETS Cash $ 2,538 $ 1,766 Restricted cash 2,628 2,582 Real estate investments, net 21,945 21,782 Digital assets 6,850 — Notes receivable - related parties 7,348 230 Due from related parties 10,597 11,143 Investments in unconsolidated entities 11,629 16,061 Operating lease - right of use assets 3,712 4,042 Prepaid and other assets 2,740 (529) Total assets $ 69,987 $ 57,077 LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) Notes payable, net $ 46,347 $ 50,450 Accounts payable and accrued expenses 7,325 9,580 Redeemable preferred stock 5,101 — Due to related parties 186 313 Operating lease liabilities 4,163 4,360 Other liabilities 819 818 Total liabilities 63,941 65,521 Preferred stock - Series A — — Preferred stock - Series B — — Common stock 7 1 Paid-in capital 77,263 41,552 Accumulated deficit (71,224) (49,997) Total stockholders’ equity (deficit) 6,046 (8,444) Total liabilities and stockholders’ equity (deficit) $ 69,987 $ 57,077 Investment Valuations The investments that are held by our funds are generally considered to be illiquid and have no readily ascertainable market value. We value these investments based on our estimate of their fair value as of the date of determination. We estimate the fair value of our fund’s investments based on several inputs built within forecasting models. The models generally rely on discounted cash flow analysis and other techniques and may include independently sourced market parameters. The material estimates and assumptions used in these models include the timing and expected amounts of cash flows, income and expenses for the property, the appropriateness of discount rates used, overall capitalization rate, and, in some cases, the ability to execute, estimated proceeds and timing of expected sales and financings. Most of our assets utilize the income approach to value the property. Where appropriate, management may obtain additional supporting evidence of values from methods generally utilized in the real estate investment industry, such as appraisal reports and broker price opinion reports. With respect to the underlying factors that led to the change in fair value in the current year, we identify assets that are undervalued and/or underperforming as part of our acquisition strategy. Such assets generally undergo some form of repositioning soon after our acquisition to help drive increased appreciation and operating performance. Once the repositioning is complete, we focus on increasing the asset’s net operating income, thereby further increasing the value of the asset. By making these below-market acquisitions, adding value through development activities, and increasing free cash flow with proper management all represent a material component to our core business model. 47 Table of Contents A unique feature of our funds is the discretion given to our management team to decide when to sell assets and when to hold them. We believe this discretion allows us to avoid selling properties that, while their business plan may have matured, the market will not pay an attractive price in the current environment. Avoiding selling at a time of disruption, such as all of 2020, is critical to preserving the value of our assets, our carried interest, our ongoing revenues, and our clients’ capital. While this is management’s expectation, there can be no assurance these outcomes will occur. Assets Under Management AUM refers to the assets we manage or sponsor. We monitor two types of information regarding our AUM: i. Managed Capital – we define this as the total capital we fundraise from our customers as investments in our funds. It also includes fundraising into our corporate note program, the proceeds of which were used, in part, to invest in or loan to our funds. We use this information to monitor, among other things, the amount of ‘preferred return’ that would be paid at the time of a distribution and the potential to earn a performance fee over and above the preferred return at the time of the distribution. Our fund management fees are based on a percentage of managed capital or a percentage of assets under management, and monitoring the change and composition of managed capital provides relevant data points for our management to further calculate and predict future earnings. ii. Fair Value (“FV”) AUM – we define this is as the aggregate fair value of the real estate assets we manage and from which we derive management fees, performance revenues and other fees and expense reimbursements. We estimate the value of these assets quarterly to help make sale and hold decisions and to evaluate whether an existing asset would benefit from refinancing or recapitalization. This also gives us insight into the value of our carried interest at any point in time. We also utilize FV AUM to predict the percentage of our portfolio which may need development services in a given year, fund management services (such as refinance), and brokerage services. As we control the decision to hire for these services, our service income is generally predictable based upon our current portfolio AUM and our expectations for AUM growth in the year forecasted. As of December 31, 2025, we had total FV AUM of approximately $779.7 million. Although we believe we are utilizing generally accepted methodologies for our calculation of Managed Capital and FV AUM, it may differ from our competitors, thereby making these metrics non-comparable to our competitors. Managed Capital The table below summarizes the activity of managed capital for the years ended December 31, 2025 and 2024 (in thousands): Managed Capital Balances as of December 31, 2023 $ 437,625 Originations 68,959 Return of capital (14,042) Balances as of December 31, 2024 492,542 Originations 26,499 Return of capital (1,855) Balances as of December 31, 2025 $ 517,186 The following table summarizes managed capital for our investment fund portfolios as of December 31, 2025 and 2024 (in thousands): 48 Table of Contents December 31, 2025 December 31, 2024 Real Estate Hospitality $ 49,289 $ 49,260 Caliber Hospitality Trust (1) 97,037 97,414 Residential 103,961 96,687 Commercial 180,569 170,858 Total Real Estate (2) 430,856 414,219 Credit (3) 82,163 72,351 Other (4) 4,167 5,972 Total $ 517,186 $ 492,542 ___________________________________________ (1) We earn a fund management fee of 0.7% of the CHT enterprise value and are reimbursed for certain costs incurred on behalf of CHT. (2) Beginning the year ended December 31, 2023, we include capital raised from investors in CaliberCos Inc. through corporate note issuances that were further invested in our funds in Managed Capital. As of December 31, 2025 and 2024, we invested $11.6 million and $20.4 million, respectively, in our funds. (3) Credit managed capital represents loans made to our investment funds by us and our diversified credit fund. As of December 31, 2025 and 2024, we had loaned $8.5 million and $0.4 million to our funds. (4) Other managed capital represents undeployed capital held in our diversified funds. Managed capital for our hospitality funds and CHT was effectively flat during the year ended December 31, 2025. Managed capital for our residential investment funds increased by $7.3 million during the year ended December 31, 2025, representing: (i) $6.7 million in capital raised into our residential assets and (ii) $1.4 million contributed by our diversified funds offset by $0.8 million in redemptions. Managed capital for our commercial investment funds increased by $9.7 million during the year ended December 31, 2025, representing: (i) $5.2 million in capital raised into our commercial assets offset by $0.2 million of capital returns, and (ii) $5.4 million contributed by our diversified funds offset by $0.7 million return of capital. The scope of investments included tenant improvements, land development, and acquiring existing operating commercial properties. During the year ended December 31, 2025, our diversified funds deployed $10.2 million into our various real estate investments, which was offset by $0.4 million of repayments of outstanding notes receivable. As of December 31, 2025, other managed capital decreased $1.8 million, due to a decrease in funds not yet deployed and pursuit costs. FV AUM Our fair value AUM decreased primarily due to asset sales, partially offset by asset purchases. T he table below details the activities that had an impact on our FV AUM, during the years ended December 31, 2025 and 2024 (in thousands). 49 Table of Contents Balances as of December 31, 2023 $ 741,190 Assets acquired (1) 34,590 CHT contribution 29,900 Construction and net market appreciation 40,675 Assets sold or disposed (2) (35,765) Credit (3) (12,237) Other (4) (3,430) Balances as of December 31, 2024 794,923 Assets acquired (1) 12,319 Construction and net market depreciation (4,359) Assets sold or disposed (2) (31,160) Credit (3) 9,812 Other (4) (1,805) Balances as of December 31, 2025 $ 779,730 The following table summarizes FV AUM of our investment fund portfolios as of December 31, 2025 and 2024 (in thousands): December 31, 2025 December 31, 2024 Real Estate Hospitality $ 55,600 $ 68,500 Caliber Hospitality Trust 191,900 236,800 Residential 165,900 161,700 Commercial 280,000 249,600 Total Real Estate 693,400 716,600 Credit (3) 82,163 72,351 Other (4) 4,167 5,972 Total $ 779,730 $ 794,923 ___________________________________________ (1) Assets acquired during the year ended December 31, 2025 include one self-storage property in Colorado and one land parcel intended for hotel development in Texas. Assets acquired during the year ended December 31, 2024 include a 133-acre mixed-use land development property in Colorado and an office building conversion to multi-family residential. (2) Assets sold during the year ended December 31, 2025 include three hospitality assets and various lot sales related to development assets. Assets sold during the year ended December 31, 2024 include a commercial asset, lot sales related to two development assets in Colorado, and one home from our residential fund. (3) Credit FV AUM represents loans made to our investment funds by our diversified credit fund. (4) Other FV AUM represents undeployed capital held in our diversified funds. Assets Under Development We have several development, redevelopment, construction, and entitlement projects that are underway or are in the planning stages, which we define as AUD. This category includes projects to be built on undeveloped land and projects to be built and constructed on undeveloped lands, which are not yet owned by our funds. Completing these development activities may ultimately result in income-producing assets, assets we may sell to third parties, or both. If we complete all AUD at December 31, 2025, up through sale, we estimate we could earn up to $104.2 million in performance allocations. As of December 31, 2025, we are actively developing 1,796 multifamily units, 697 single family units, 3.7 million square feet of commercial and industrial, and 3.5 million square feet of office and retail. If all of these projects are brought to completion, the total cost capitalized to these projects, which represents total current estimate costs to complete the development and construction of such projects by us or a third party, is $1.9 billion, which we expect would be funded through a combination of undeployed fund cash, third-party equity, project sales, tax credit financing and similar incentives, and secured debt financing. We are under no obligation to complete these projects and may dispose of any such assets at any time. There can be no assurance that AUD will ultimately be developed or constructed because of the nature of the cost of the approval and development process and market demand for a particular use. In 50 Table of Contents addition, the mix of residential and commercial assets under development may change prior to final development. The development of these assets will require significant additional financing or other sources of funding which may not be available. Non-GAAP Measures We use non-GAAP financial measures to evaluate operating performance, identify trends, formulate financial projections, make strategic decisions, and for other discretionary purposes. We believe that these measures enhance the understanding of ongoing operations and comparability of current results to prior periods and may be useful for investors to analyze our financial performance because they provide investors with a view of the performance attributable to us . When analyzing our operating performance, investors should use these measures in addition to, and not as an alternative for, their most directly comparable financial measure calculated and presented in accordance with U.S. GAAP. Our presentation of non-GAAP measures may not be comparable to similarly identified measures of other companies because not all companies use the same calculations. These measures may also differ from the amounts calculated under similarly titled definitions in our debt instruments, which amounts are further adjusted to reflect certain other cash and non-cash charges and are used by us to determine compliance with financial covenants therein and our ability to engage in certain activities, such as incurring additional debt and making certain restricted payments. Asset Management Platform or Platform Platform refers to the performance of our asset management platform segment, which generates revenues and expenses from managing our investment portfolio, which does not include any consolidated assets or funds. These activities include asset management, transaction services, and performance allocations. Management believes that this is an important view of us because it communicates performance of us that would be most useful for understanding the value of CWD. Fee-Related Earnings and Related Components Fee-Related Earnings is a supplemental non-GAAP performance measure used to assess our ability to generate profits from fee-based revenues, focusing on whether our core revenue streams are sufficient to cover our core operating expenses. Fee-Related Earnings represents our net income (loss) before income taxes adjusted to exclude depreciation and amortization, stock-based compensation, interest expense and extraordinary or non-recurring revenue and expenses, including performance allocation revenue and change in fair value of digital assets, public registration direct costs related to aborted or delayed offerings and our Reg A+ offering, litigation settlements, and expenses recorded to earnings relating to investment deals which were abandoned or closed. Fee-Related Earnings are presented on a basis that deconsolidates our consolidated funds (intercompany eliminations) and eliminates noncontrolling interest. Eliminating the impact of consolidated funds and noncontrolling interest provides investors with a view of the performance attributable to CaliberCos Inc. and is consistent with performance models and analysis used by management. Distributable Earnings Distributable Earnings is a supplemental non-GAAP performance measure equal to Fee-Related Earnings plus performance allocation revenue and less interest expenses and provision for income taxes. We believe that Distributable Earnings can be useful as a supplemental performance measure to our GAAP results assessing the amount of earnings available for distribution. P latform Earnings Platform Earnings represents the performance of our asset management platform segment, which generates revenues and expenses from managing our investment portfolio, excluding any consolidated assets or funds. We evaluate recurring earnings capacity through fee-related earnings, defined as fund management fees, financing fees, development and construction fees, organizational and offering fees, and brokerage fees, less direct operating expenses. We believe this measure provides investors with insight into the recurring operating profile of our asset management platform independent of performance allocation timing. Platform Earnings per Share Platform Earnings per Share is calculated as Platform Earnings divided by weighted average CWD common shares outstanding. Platform Adjusted EBITDA Platform Adjusted EBITDA represents our Distributable Earnings adjusted for interest expense, other income (expense), and provision for income taxes on a basis that deconsolidates our consolidated funds (intercompany eliminations) and eliminates 51 Table of Contents noncontrolling interest. Eliminating the impact of consolidated funds and noncontrolling interest provides investors with a view of the performance attributable to the Platform and is consistent with performance models and analysis used by management. Consolidated Adjusted EBITDA Consolidated Adjusted EBITDA represents our and the consolidated funds’ earnings before net interest expense, income taxes, depreciation and amortization, further adjusted to exclude stock-based compensation, transaction fees, expenses and other public registration direct costs related to aborted or delayed offerings and our Reg A+ offering, litigation settlements, expenses recorded to earnings relating to investment deals which were abandoned or closed, any other non-cash expenses or losses, as further adjusted for extraordinary or non-recurring items. Platform Basic and Diluted Earnings Per Share (“EPS”) Platform Basic and Diluted EPS represents earnings per share generated by the Platform, without reflecting the impact of consolidation. Eliminating the impact of consolidated funds and noncontrolling interest provides investors with a view of the performance attributable to the Platform and is consistent with performance models and analysis used by management. The following table presents a reconciliation of net loss attributable to CaliberCos Inc. to Fee-Related Earnings, Distributable Earnings, Platform Adjusted EBITDA, and Consolidated Adjusted EBITDA for the years ended December 31, 2025 and 2024 (in thousands): Years Ended December 31, 2025 2024 Net loss attributable to CaliberCos Inc. $ (21,798) $ (19,777) Net loss attributable to noncontrolling interests (1,229) (1,693) Net loss (23,027) (21,470) Provision for income taxes — — Net loss before income taxes (23,027) (21,470) Depreciation and amortization 691 598 Consolidated funds' impact on fee-related earnings 1,025 1,185 Stock-based compensation 1,697 2,378 Severance 1,016 244 Performance allocations (27) (358) Other (income) expenses, net (360) (1,211) Investments impairment 2,808 4,304 Change in fair value of digital assets 5,793 — Bad debt expense 85 4,079 Interest expense, net 6,355 4,865 Fee-related earnings (3,944) (5,386) Performance allocations 27 358 Interest expense, net (6,355) (4,865) Provision for income taxes — — Distributable earnings (10,272) (9,893) Interest expense 6,712 5,424 Other expenses (income), net 360 1,211 Provision for income taxes — — Consolidated funds' impact on Caliber adjusted EBITDA 772 548 Platform adjusted EBITDA (2,428) (2,710) Consolidated funds' EBITDA adjustments 1,633 9,694 Consolidated adjusted EBITDA $ (795) $ 6,984 All share and per share amounts in the Platform and Consolidated, basic and diluted earnings per share calculations below have been affected for the Reverse Stock Split, retroactively, for all periods presented. The following tables present a reconciliation of Platform revenues, expenses and net income to the most comparable U.S. GAAP measure for the years ended December 31, 2025 and 2024 (in thousands): 52 Table of Contents Year Ended December 31, 2025 Platform Impact of Consolidated Funds Consolidated Revenues Asset management $ 15,155 $ (764) $ 14,391 Performance allocations 33 (6) 27 Consolidated funds – hospitality revenue — 5,057 5,057 Consolidated funds – other revenue — 622 622 Total revenues 15,188 4,909 20,097 Expenses Operating costs 2,274 (607) 1,667 Payroll and payroll related costs 12,181 — 12,181 General and administrative 5,796 (41) 5,755 Marketing and advertising 795 1 796 Depreciation and amortization 691 (27) 664 Consolidated funds – hospitality expenses — 4,743 4,743 Consolidated funds – other expenses — 1,865 1,865 Total expenses 21,737 5,934 27,671 Other expense, net (2,533) (771) (3,304) Change in fair value of digital assets (5,793) — (5,793) Interest income 357 (1) 356 Interest expense (6,712) — (6,712) Net loss before income taxes (21,230) (1,797) (23,027) Provision for income taxes — — — Net loss (21,230) (1,797) (23,027) Net loss attributable to noncontrolling interests — (1,229) (1,229) Net loss attributable to CaliberCos Inc. $ (21,230) $ (568) $ (21,798) 53 Table of Contents Year Ended December 31, 2024 Platform Impact of Consolidated Funds Consolidated Revenues Asset management $ 20,563 $ (3,684) $ 16,879 Performance allocations 379 (21) 358 Consolidated funds – hospitality revenue — 26,476 26,476 Consolidated funds – other revenue — 7,406 7,406 Total revenues 20,942 30,177 51,119 Expenses Operating costs 7,139 (965) 6,174 Payroll and payroll related costs 17,765 — 17,765 General and administrative 6,817 (41) 6,776 Marketing and advertising 751 — 751 Depreciation and amortization 598 (5) 593 Consolidated funds – hospitality expenses — 26,503 26,503 Consolidated funds – other expenses — 5,870 5,870 Total expenses 33,070 31,362 64,432 Other expense, net (2,654) (439) (3,093) Interest income 559 (199) 360 Interest expense (5,424) — (5,424) Net loss before income taxes (19,647) (1,823) (21,470) Provision for income taxes — — — Net loss (19,647) (1,823) (21,470) Net loss attributable to noncontrolling interests — (1,693) (1,693) Net loss attributable to CaliberCos Inc. $ (19,647) $ (130) $ (19,777) Liquidity and Capital Resources At December 31, 2025, we had a portfolio of corporate notes, whose composition and characteristics are similar to those reported in prior periods. At December 31, 2025, the portfolio consisted of 178 unsecured notes with an aggregate principal balance of $29.6 million. As of March 25, 2026, an aggregate of $24.5 million of the corporate and convertible notes have matured or will mature within the 12-month period subsequent to when these financial statements were issued. The notes generally have 12-month or 36-month terms, with the 12-month note holders having the option to extend for an additional 12-month term. Because we incurred recurring operating losses and negative cash flow from operations, and could experience additional future operating losses and negative cash flow in the near term, combined with the fact that we do not have sufficient cash on hand to satisfy the total of the notes that mature within the next 12 months, these conditions and events raise substantial doubt about our ability to continue as a going concern. In response to these conditions, management considered the impact of these near-term maturities on us. Management evaluated the impact a default of one or many of these notes might have on us. As these notes are unsecured, the terms in the agreements do not afford the note holder avenues of recourse in a default that could or would impact us adversely in the normal course of business, as the terms lack provisions for rights or claims against our assets, nor is there a scenario where a default could force liquidation of us. Management believes that even in the event of default of one or many of these notes, we would be able to negotiate a waiver of the default either through an extension of the maturity or principal repayment schedule. 54 Table of Contents To satisfy the maturity of these corporate notes, we intend to execute the following strategies: i. Raise $20 million of preferred stock series AA financing through its Reg A+ offering, which was qualified on March 12, 2025. From program inception through March 25, 2026, we have raised $6.4 million of Series AA preferred stock. ii. Refinance existing 12-month term notes into its new 36-month term corporate note program. From the program inception through March 25, 2026, we have successfully refinanced $6.4 million of 12-month term corporate notes into its new 36-month term corporate note program. iii. Convert corporate notes into shares of CWD common stock. In October 2025, we launched a note conversion program (the “Program”) whereby holders (the “Note Holders”) of outstanding promissory notes (the “Notes”) may convert and cancel all or part of the Note Holders’ Notes in exchange for shares of Class A common stock, par value $0.001 (the “Conversion Agreement”) at a per share conversion price equaling the lower of (i) the average closing price of CWD’s Class A common stock over the five trading days prior to the execution of the respective Conversion Agreement, or the (ii) closing bid price of CWD’s Class A common stock the business day preceding the execution of the respective Conversion Agreement (the “Conversion Prices”). From program inception through March 25, 2026, we have successfully converted $1.9 million of corporate notes into 564,731 shares of common stock. The Conversion Prices ranged from $3.14 to $3.72 per share. iv. Raise equity capital in support of its Chainlink (“LINK”) strategy through its approved ELOC and ATM facilities, with a portion of the proceeds allocated to general corporate purposes. From program inception through March 25, 2026, the Company generated $37.7 million million in net cash from equity issuances across all sources. In addition to the financing actions noted, management continues to execute various plans implemented in the year to address operating losses and near-term maturities or demands for repayment of its notes. Consistent with reported actions taken in prior reporting periods, management plans to continue to i) reduce operating costs, ii) collect all or part of its $10.7 million in receivables, iii) collect all or part of its $11.6 million in investments from its managed funds, iv) increase capital raise through continued expansion of fundraising channels, v) sell or accept investment into its corporate headquarters, vi) place debt on unencumbered assets, and/or vii) generate planned cash from operations. During the year ended December 31, 2025, as part of the execution of our aforementioned plans, we raised $33.8 million in new equity in support of our LINK strategy, investing $12.6 million in LINK and maintaining $2.5 million in unrestricted cash on hand. We collected $2.1 million in notes receivable, $12.5 million in accounts receivable, and $2.0 million in redemptions of investments from its managed funds. In addition, we have implemented broad-based cost reductions, most notably being further workforce reductions, which are expected to result in annualized cost savings of $3.9 million in compensation and employee benefit expenses. After consideration of the implemented and planned actions, management concluded these plans are not within our control and therefore cannot be deemed probable. As a result, we have concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. Each of our funds and the related assets that are acquired or own equity interest in those funds are established as separate legal entities with limited liability. Therefore, the cash flows generated by these entities, whether through operations or financing, are unavailable for general corporate purposes, except as payment to us for services performed by us. Corporate Debt As of December 31, 2025, we have issued and outstanding unsecured promissory notes of $29.6 million with an average outstanding principal balance of $0.2 million, a weighted average interest rate of 11.14%, and maturity dates ranging from January 2024 to March 2028. The purpose of this financing program is to provide us with flexible, short-term capital to be used to grow its assets under management and assist funds in a fast-moving acquisition or investment, as well as general corporate purposes. Additionally, the program provides customers of our funds access to a short-term lending opportunity. Management actively manages each relationship to determine if the respective customer would like to redeem upon maturity or extend for an additional period of time. This outstanding debt resulted in $3.6 million and $4.0 million of interest expense for the years ended December 31, 2025 and 2024, respectively. 55 Table of Contents Cash Flows Analysis The section below discusses in more detail our primary sources and uses of cash and primary drivers of cash flow within our consolidated statements of cash flows (in thousands). Years Ended December 31, 2025 2024 $ Change Net cash (used in) provided by: Operating activities $ (12,065) $ 555 $ (12,620) Investing activities (23,721) (19,629) (4,092) Financing activities 36,905 6,331 30,574 Net change in cash and cash equivalents $ 1,119 $ (12,743) $ 13,862 The assets of our consolidated funds, on a gross basis, can be substantially larger than the assets of our core business and, accordingly, could have a substantial effect on the accompanying statements of cash flows. The table below summarizes our consolidated statements of cash flow by activity attributable to us and to our consolidated funds (in thousands). Years Ended December 31, 2025 2024 $ Change Net cash used in the Company's operating activities $ (12,757) $ (4,626) $ (8,131) Net cash provided by the consolidated funds' operating activities 692 5,181 (4,489) Net cash (used in) provided by the Company's operating activities (12,065) 555 (12,620) Net cash (used in) provided by the Company's investing activities (20,147) 4,911 (25,058) Net cash used in the consolidated funds' investing activities (3,574) (24,540) 20,966 Net cash used in the Company's investing activities (23,721) (19,629) (4,092) Net cash provided by (used in) the Company's financing activities 33,295 (1,217) 34,512 Net cash provided by the consolidated funds' financing activities 3,610 7,548 (3,938) Net cash provided by the Company's financing activities 36,905 6,331 30,574 Net change in cash and cash equivalents $ 1,119 $ (12,743) $ 13,862 Operating Activities Our net cash flows from operating activities are generally comprised of asset management revenues and performance allocations, less cash used for operating expenses, including interest paid on our debt obligations. The increase in net cash flows used in operating activities of the Company during the year ended December 31, 2025, as compared to the same period in 2024, primarily relates to a decrease in asset management revenues, development and construction fees and fund management fees specifically, and an increase in related party receivables. The decrease in net cash flows provided by operating activities of the consolidated funds during the year ended December 31, 2025, as compared to same period in 2024, was primarily related to the deconsolidation of VIEs. Investing Activities Net cash flows used in investing activities of the Company increased during the year ended December 31, 2025, as compared to net cash flows provided by investing activities of the Company the same period in 2024. This increase primarily relates to the investment in digital assets during the year ended December 31, 2025, with no comparable investments during the same period in 2024, and a decrease in net proceeds from notes receivable - related parties. The decrease in net cash flows used in investing activities of the consolidated funds is primarily due to the deconsolidation of VIEs and a decrease in the net funding of notes receivable - related parties. Financing Activities Net cash flows provided by financing activities of the Company increased during the year ended December 31, 2025, as compared to the net cash flows used in in the same period in 2024. The increase was primarily due to an increase in net proceeds from the issuance of preferred stock, common stock, and redeemable preferred stock. The decrease in net cash flows provided by 56 Table of Contents financing activities of the consolidated funds is primarily due to a decrease in contributions from noncontrolling interest holders of $16.4 million, offset by an increase of $5.7 million of net proceeds on notes payable and a decrease in distributions to noncontrolling interest holders of $5.2 million. Critical Accounting Policies and Estimates The preparation of our consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. These estimates are made and evaluated on an ongoing basis using information that is currently available as well as various other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates, perhaps in adverse ways, and those estimates could be different under different assumptions or conditions. Accounting Policies and Estimates of the Company We believe the following critical accounting policies affect our more significant estimates and judgments used in the preparation of our consolidated financial statements. Revenue Recognition In accordance with the Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”), management applies the five-step framework in determining the timing and amount of revenue to recognize. This framework requires an entity to: (i) identify the contract(s) with customers, (ii) identify the performance obligations within the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations within the contract, and (v) recognize revenue when or as the entity satisfies a performance obligation. Revenues from contracts with customers includes fixed fee arrangements with related party affiliates to provide certain associated activities which are ancillary to and generally add value to the assets we manage, such as set-up and fund formation services associated with marketing, soliciting, and selling member interests in the affiliated limited partnerships, brokerage services, construction and development management services, loan placement and guarantees. The recognition and measurement of revenue is based on the assessment of individual contract terms. For performance obligations satisfied at a point in time, there are no significant judgments made in evaluating when the customer obtains control of the promised service. For performance obligations that are satisfied over time, significant judgment is required to determine how to allocate transaction prices where multiple performance obligations are identified; when to recognize revenue based on appropriate measurement of our progress under the contract; and whether constraints on variable consideration should be applied due to uncertain future events. Transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Variable consideration is included in the estimated transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur or when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in transaction price are based largely on an assessment of its anticipated performance and all information that is reasonably available to us. Revenues are recognized when control of the promised services is transferred to customers in an amount that reflects the consideration we expect to be entitled to in exchange for those services. The following describes revenue recognition for the fees we earn from providing services under our asset management Platform: Fund set-up fees are a one-time fee for the initial formation, administration, and set-up of the private equity real estate fund. These fees are recognized at the point in time when the performance under the contract is complete and are included in asset management revenues in the accompanying consolidated statements of operations. Fund set-up fees replaced fund formation fees that are earned at a point in time at a fixed rate based on the amount of capital raised into certain managed funds. Fund management fees are generally based on 1.0% to 1.5% of the unreturned capital contributions in a particular fund and include reimbursement for costs incurred on behalf of the fund, including an allocation of certain overhead costs. These customer contracts require us to provide management services, representing a performance obligation that we satisfy over time. With respect to CHT, we earn a fund management fee of 0.7% of CHT’s enterprise value and are reimbursed for certain costs incurred on behalf of CHT. These revenues are included in asset management revenues in the accompanying consolidated statements of operations. 57 Table of Contents Financing fees are earned for services we perform in securing third-party financing on behalf of our private equity real estate funds. These fees are recognized at the point in time when the performance under the contract is complete, which is essentially upon closing of a loan. In addition, we earn fees for guaranteeing certain loans, representing a performance obligation that we satisfy over time. These revenues are included in asset management revenues in the accompanying consolidated statements of operations. Development and construction revenues from contracts with customers include fixed fee arrangements with related party affiliates to provide real estate development services as their principal developer, which include managing and supervising third-party developers and general contractors with respect to the development of the properties owned by the funds. Revenues are generally based on 4.0% of the total expected costs of the development or 4.0% of the total expected costs of the construction project. Prior to the commencement of construction, development fee revenue is recognized at a point in time as the related performance obligations are satisfied and the customer obtains control of the promised service, including negotiation, due diligence, entitlements, planning, and design activities. During the construction period, development fee revenue is recognized over time as the performance obligations are satisfied. These revenues are included in asset management revenues in the accompanying consolidated statements of operations. Brokerage fees are earned at a point in time at fixed rates for services performed related to acquisitions, dispositions, leasing, and financing transaction, and are included in asset management revenues in the accompanying consolidated statements of operations. Performance allocations are an arrangement in which we are entitled to an allocation of investment returns, generated within the investment funds which we manage, based on a contractual formula. We typically receive 15.0% to 35.0% of all cash distributions from (i) the operating cash flow of each fund, after payment to the related fund investors of any accumulated and unpaid priority preferred returns and repayment of preferred capital contributions; and (ii) the cash flow resulting from the sale or refinance of any real estate assets held by each fund, after payment to the related fund investors of any accumulated and unpaid priority preferred returns and repayment of initial preferred capital contributions. Our funds’ preferred returns range from 6.0% to 12.0%, typically 6.0% for common equity or 10.0% to 12.0% for preferred equity, which does not participate in profits. Performance allocations are related to services which have been provided and are recognized when it is determined that they are no longer probable of significant reversal, which is generally satisfied when an underlying fund investment is realized or sold. These revenues are included in performance allocations in the accompanying consolidated statements of operations. Digital Assets We account for our digital assets in accordance with ASU 2023-08, Accounting for and Disclosure of Crypto Assets. ASU 2023-08 requires in-scope crypto assets (including our LINK holdings) to be measured at fair value in the statement of financial position, with gains and losses from changes in the fair value of such crypto being recognized in net income (loss) each reporting period. ASU 2023-08 also requires certain interim and annual disclosures for crypto assets within the scope of the standard. We adopted this guidance effective September 9, 2025, upon the completion of our initial purchase of LINK as part of the inauguration of our digital asset treasury strategy. We initially record our LINK purchases at cost, with any subsequent changes in fair value recognized as incurred in the accompanying consolidated statements of operations. The fair value of our LINK is adjusted and disclosed within the accompanying consolidated balance sheets at the end of each reporting period. We determine the fair value of our LINK holdings in accordance with ASC 820, Fair Value Measurement, based on quoted (unadjusted) prices on the Coinbase exchange, the active exchange that we have determined is our principal market for LINK (Level 1 inputs). In the event of a sale, we will calculate the gain (loss) to be recognized as the difference between the sales price, net of transaction costs, and the carrying value of the LINK sold immediately prior to sale. We use the first-in, first-out cost basis method when calculating the gain (loss) on sale. Income Taxes We account for income taxes under the asset and liability method in accordance with ASC 740, Accounting for Income Taxes . Deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and tax basis of assets and liabilities, and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured by applying enacted tax rates and laws and are released in the years in which the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are provided against deferred tax assets when it is more-likely-than-not that some portion or all the deferred tax assets will not be realized. 58 Table of Contents A valuation allowance is required to reduce the balance of a deferred tax asset if it is determined that it is more-likely-than-not that all or some portion of the deferred tax asset will not be realized due to the lack of sufficient taxable income or other limitation on our ability to utilize the loss carryforward. We recognize the impact of an income tax position, if that position is more-likely-than-not of being sustained on audit, based on the technical merits of the position. Related interest and penalties are classified as income taxes in the financial statements. Accounting Policies and Estimates of Consolidated Funds We believe the following critical accounting policies affect the consolidated funds’ more significant estimates and judgments used in the preparation of our consolidated financial statements. Consolidated Fund Revenues In accordance with ASC 606, our consolidated funds apply the five-step framework in determining the timing and amount of revenue to recognize. This framework requires an entity to: (i) identify the contract(s) with customers, (ii) identify the performance obligations within the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations within the contract, and (v) recognize revenue when or as the entity satisfies a performance obligation. The consolidated funds’ revenues primarily consist of hospitality revenues, rental income and interest income. Consolidated funds – hospitality revenue Hospitality revenues are comprised of charges for room rentals, food and beverage sales, and other hotel operating activities. Revenues are recognized as earned, which is defined as the date upon which a guest occupies a room or utilizes the hotel’s services. Revenues are recorded net of sales tax. The consolidated funds have performance obligations to provide accommodations and other ancillary services to hotel guests. As compensation for such goods and services, the consolidated funds are typically entitled to a fixed nightly fee for an agreed upon period and additional fixed fees for any ancillary services purchased. These fees are generally payable at the time the hotel guest checks out of the hotel. The consolidated funds generally satisfy the performance obligations over time and recognize the revenue from room sales and from other ancillary guest services on a daily basis, as the rooms are occupied, and the services have been rendered. For food and beverage, revenue is recognized upon transfer of promised products or services to customers in an amount that reflects the consideration the consolidated funds received in exchange for those services, which is generally when payment is tendered at the time of sale. The consolidated funds receive deposits for events and rooms. Such deposits are deferred and are included in other liabilities on the accompanying consolidated balance sheets. The deposits are credited to consolidated funds – hospitality revenue when the specific event takes place. Consolidated funds – other revenue Consolidated funds - other revenue primarily consists of rental revenue of $0.6 million and $1.4 million for the years ended December 31, 2025 and 2024, respectively. Rental revenue includes the revenues generated primarily by the rental operations of the residential and commercial properties of our consolidated funds. In addition, consolidated funds – other revenue includes interest income, which is generated by a consolidated funds lending activity. There was no interest income for the year ended December 31, 2025. For the year ended December 31, 2024, there was $5.9 million of interest income. Interest income is recognized on the accrual basis of accounting in accordance with the lending agreements over the term of the respective loan agreement. Consolidated Fund Expenses Consolidated fund expenses consist primarily of costs, expenses and fees that are incurred by, or arise out of the operation and activities of or otherwise related to, the consolidated funds, including, without limitation, operating costs, depreciation and amortization, interest expense on debt held by the consolidated funds, gain on extinguishment of debt, gain on derivative instruments, insurance expenses, professional fees and other costs associated with administering and supporting those funds. 59 Table of Contents Fair Value of Financial Instruments The fair value of financial instruments is disclosed in accordance with ASC 825, Financial Instruments . The fair value of the consolidated funds financial instruments is estimated using available market information and established valuation methodologies. The estimates of fair value are not necessarily indicative of the amounts the consolidated funds could realize on disposition of the financial instruments. The use of different market assumptions and/or valuation methodologies may have a material effect on the estimated fair value amounts.