Presidio Property Trust, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure based closely on the definition of “disclosure controls and procedures” in Rule 13a-14(c). In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. In connection with the preparation and audit of the financial statements as of and for the fiscal year ended December 31, 2024, our disclosure controls and procedures were effective and were operating at a reasonable assurance level. Management ’ s Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework). Based on our evaluation under the framework in Internal Control — Integrated Framework, our management concluded that our internal controls over financial reporting were effective as of December 31, 2024. This annual report on Form 10-K does not include an attestation report of the Company’s independent registered public accounting firm regarding our internal control over financial reporting as such report is not required for the Company. Changes in Internal Control over Financial Reporting During the year ended December 31, 2023, a material weakness was identified in our internal control over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected on a timely basis. This material weakness primarily related to a non-recuring significant transaction for income tax provision under ASC 740, Income Taxes , and comprised the following: ● We lacked a formal review and approval process in connection with the annual income tax provision, specifically related to REIT and non-REIT subsidiaries and the ownership of Conduit shares received by the Company in the de-SPAC transaction on September 22, 2023. ● We did not design adequate internal controls under an appropriate financial reporting framework, including monitoring controls and certain entity level controls with regards to the income tax provision. We have implemented measures designed to improve our internal control over financial reporting to remediate this material weakness. The material weakness is considered remediated and our remediation plan has been fully implemented, the applicable controls have operated for a sufficient period of time, and we have concluded, through testing, that the newly implemented and enhanced controls are operating effectively. We commenced the remediation plan during 2024 and have documented such plan, followed with testing such controls over time. 65 Table of Contents We added controls around the calculation and preparation of income tax provisions and expenses, we engaged with third party experts, and continually identified and monitored the taxable status of each subsidiary for annual reporting. There were no additional changes in our internal control over financial reporting that occurred during the fiscal year ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Furthermore, we do not believe that these controls have been impacted by COVID-19 related circumstances, including remote work arrangements with our employees. Limitations on the Effectiveness of Controls Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk. ITEM 9B. OTHER INFORMATION During the three months ended December 31, 2024 , no director or officer of the Company adopted or terminated a “Rule 10b5 - 1 trading arrangement” or “non-Rule 10b5 - 1 trading arrangement,” as each term is defined in Item 408 (a) of Regulation S-K. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS None. 66 Table of Contents Part III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Except as set forth below, the information required by this item is set forth under the captions “Board of Directors” and “Executive Officers of the Company” and “Section 16(a) Beneficial Ownership Reporting Compliance” in our definitive Proxy Statement for the 2025 Annual Meeting of Stockholders, to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024 pursuant to Regulation 14A, and is incorporated herein by reference. Insider Trading Policy The Company has adopted an insider trading policy governing the purchase, sale, and/or other disposition of its securities by its directors, officers, employees and independent contractors that the Company believes is reasonably designed to promote compliance with insider trading laws, rules and regulations, and the exchange listing standards applicable to the Company. Directors, executive officers, employees and other related persons may not buy, sell or engage in other transactions in the Company’s shares while aware of material non-public information; buy or sell securities of other companies while aware of material non-public information about those companies that they became aware of as a result of business dealings between the Company and those companies; or disclose material non-public information to any unauthorized persons outside of the Company. The policy also restricts trading and other transactions for a limited group of Company employees (including executives and directors) to defined window periods that follow the Company's quarterly earnings releases and restricts trading and other transactions following announcement of a share repurchase program. A copy of such policy is filed hereto as Exhibit 19.1. ITEM 11. EXECUTIVE COMPENSATION The information required by this item is set forth under the caption “Executive Compensation” in our definitive Proxy Statement for the 2025 Annual Meeting of Stockholders, to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024 pursuant to Regulation 14A, and is incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information required by this item will be set forth under the caption “Security Ownership of Certain Beneficial Owners and Management” in our definitive Proxy Statement for the 2025 Annual Meeting of Stockholders, to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024 pursuant to Regulation 14A, and is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE The information required by this item is set forth under the caption “Related Party Transactions” in our definitive Proxy Statement for the 2025 Annual Meeting of Stockholders, to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024 pursuant to Regulation 14A, and is incorporated herein by reference. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information required by this item is set forth under the caption “Independent Registered Public Accounting Firm Fees and Services” in our definitive Proxy Statement for the 2025 Annual Meeting of Stockholders, to be filed with the SEC within 120 days of the fiscal year ended December 31, 2024 pursuant to Regulation 14A, and is incorporated herein by reference. 67 Table of Contents PART IV ITEM 15. EXHIBIT AND FINANCIAL STATEMENT SCHEDULES (1) Financial Statements - the following documents are filed as part of this report: • Report of Independent Registered Public Accounting Firm • Consolidated Balance Sheets as of December 31, 2024 and 2023 • Consolidated Statements of Operations for the years ended December 31, 2024 and 2023 • Consolidated Statements of Equity for the years ended December 31, 2024 and 2023 • Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023 • Notes to Consolidated Financial Statements (2) Financial Statement Schedules - the following documents are filed as part of this report: • Schedule III - Real Estate Assets and Accumulated Depreciation and Amortization as of December 31, 2024 All other financial statement schedules have been omitted for the reason that the required information is presented in the financial statements or notes thereto, the amounts involved are not significant or the schedules are not applicable. 68 Table of Contents (3) Exhibits - an index to the Exhibits as filed as part of this Form 10-K is set forth below. Number Description 3.1 Articles of Merger filed with the Maryland State Department of Assessments and Taxation and the California Secretary of State on August 4, 2010 (incorporated by reference to Exhibit 3.03 of the Company’s Current Report on Form 8-K filed on August 10, 2010). 3.2 Articles of Amendment and Restatement of the Articles of Incorporation, dated as of July 30, 2010 (incorporated by reference to Exhibit 3.01 of the Company’s Current Report on Form 8-K filed on August 10, 2010). 3.3 Articles Supplementary filed on August 4, 2014 (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on August 8, 2014). 3.4 Articles of Amendment of Presidio Property Trust, Inc. (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on October 19, 2017). 3.5 Articles Supplementary classifying and designating the Series C Common Stock (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed on July 31, 2020). 3.6 Articles of Amendment effecting the reverse stock split (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on July 31, 2020). 3.7 Articles Supplementary classifying and designating 805,000 shares of the Series D Preferred Stock (incorporated by reference to the Company’s Form 8-A12B filed on June 9, 2021). 3.8 Articles Supplementary classifying and designating an additional 115,000 shares of the Series D Preferred Stock (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed on June 15, 2021). 3.9 Articles Supplementary relating to election to be subject to Section 3-803 of the Maryland General Corporation Law (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on March 22, 2024). 3.10 Articles Supplementary classifying and designating an additional 80,000 shares of the Series D Preferred Stock (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed on June 24, 2024). 3.11 Second Amended and Restated Bylaws of Presidio Property Trust, Inc. (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed on October 19, 2017). 4.1 Form of Series A Common Stock Certificate (incorporated by reference to Exhibit 4.1 of the Company’s Registration Statement on Form 10-12B filed on May 6, 2008). 4.2 Description of Securities * 4.3 Form of Common Stock Warrant (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on July 14, 2021). 4.4 Form of Placement Agent Warrant (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K filed on July 14, 2021). 4.5 Form of Warrant (incorporated by reference to Exhibit 4.5 of the Company’s Registration Statement on Form S-11 filed on November 9, 2021). 4.6 Form of Warrant Agent Agreement (incorporated by reference to Exhibit 4.6 of the Company’s Registration Statement on Form S-11 filed on November 9, 2021). 10.1 Dividend Reinvestment Plan (incorporated by reference to Exhibit 10.2 of the Company ’ s Registration Statement on Form 10-12B filed on May 6, 2008). 10.2 Purchase and Sale Agreement and Joint Escrow Instructions among NetREIT Highland, LLC, NetREIT Joshua, LLC, NetREIT Casa Grande, LP, NetREIT Sunrise, LLC, NetREIT, Inc. and Sparky’s Storage 18 (CA) LP, dated as of February 6, 2015; as amended by the First Amendment dated February 25, 2015, and the Second Amendment dated April 2, 2015 (incorporated by reference to Exhibit 99.1 of the Company’s Current Report on Form 8-K filed on April 15, 2015). 10.3+ Amended and Restated Presidio Property Trust, Inc. 2017 Incentive Award Plan (incorporated by reference to Exhibit B of the Company’s Proxy Statement filed on April 17, 2023). 10.4+ Form of Restricted Stock Agreement under 2017 Incentive Award Plan (incorporated by reference to Exhibit 10.25 of the Company’s Registration Statement on Form S-11/A filed on January 17, 2018). 10.5 Ninth Amendment to Loan Agreement signed August 19, 2021 (incorporated by reference to Exhibit 1.1 of the Company’s Current Report on Form 8-K filed on August 25, 2021). 10.6 Loan Agreement dated February 26, 2016, together with Second Amendment to Loan Agreement dated as of June 29, 2016, Third Amendment to Loan Agreement dated as of April 11, 2017, Joinder and Fourth Amendment to Loan Agreement dated as of February 20, 2018, Fifth Amendment to Loan Agreement dated as of April 11, 2018, Joinder and Sixth Amendment to Loan Agreement dated as of April 11, 2019, Joinder and Seventh Amendment to Loan Agreement dated as May 22, 2020 and Eighth Amendment to Loan Agreement dated as of June 26, 2020 (incorporated by reference to Exhibit 1.2 of the Company’s Current Report on Form 8-K filed on August 25, 2021). 10.7 Form of Indemnification Agreement entered into between the Company and each of its directors and executive officers (incorporated by reference to Exhibit 10.10 of the Company’s Registration Statement on Form S-11 filed on September 18, 2017). 10.8 Tenth Amendment to Loan Agreement signed October 12, 2022 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on October 14, 2022). 10.9 Tenth Amendment to Guaranty Agreement signed October 12, 2022 (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on October 14, 2022). 10.10+ Employment agreement with Jack Heilbron (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on January 5, 2024) 10.11+ Employment agreement with Ed Bentzen (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K filed on February 9, 2024) 10.12+ Employment agreement with Gary Katz (incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed on February 9, 2024) 10.13+ Employment agreement with Steven Hightower (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on February 9, 2024) 10.14 Cooperation Agreement by and between Presidio Property Trust, Inc. and Zuma Capital Management, LLC and the other parties named as signatories thereto, dated May 9, 2024 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed with the Commission on May 10, 2024). 10.15 Underwriting Agreement dated June 20, 2024, by and between the Company and The Benchmark Company, LLC (incorporated by reference to Exhibit 1.1 to the Current Report on Form 8-K, filed with the Commission on June 24, 2024). 14 Code of Ethics (incorporated by reference to Exhibit 14 of the Company’s Annual Report on Form 10-K filed on March 30, 2021). 19.1 Insider Trading Policy, effective September 19, 2022.* 21.1 Subsidiaries of the Registrant.* 23.1 Consent of Independent Registered Public Accounting Firm * 23.2 Consent of Independent Registered Public Accounting Firm * 31.1 Certificate of the Company’s Chief Executive Officer (Principal Executive Officer) pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. * 31.2 Certification of the Company’s Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. * 32.1 Certification of Chief Executive Officer, Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. * 97.1 Clawback Policy of the Company (incorporated by reference to Exhibit 97.1 of the Company’s Annual Report on Form 10-K filed on April 16, 2024). 101.INS Inline XBRL Instance Document (the I nstance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) 69 Table of Contents 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) ____________________________________________________ ∗ Filed herewith + Denotes a compensatory plan or arrangement ITEM 16. FORM 10-K SUMMARY None. 70 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. PRESIDIO PROPERTY TRUST, INC. By: /s/ Jack K. Heilbron Jack K. Heilbron Chief Executive Officer and Chairman of the Board (Principal Executive Officer) Date: March 31, 2025 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Jack K. Heilbron Director, Chairman of the Board and Chief Executive Officer March 31, 2025 Jack K. Heilbron (Principal Executive Officer) /s/ Ed Bentzen Chief Financial Officer (Principal Financial and Accounting Officer) March 31, 2025 Ed Bentzen /s/ Steven Hightower Director March 31, 2025 Steven Hightower /s/ Jennifer A. Barnes Director March 31, 2025 Jennifer A. Barnes /s/ Elena Piliptchak Director March 31, 2025 Elena Piliptchak /s/ David T. Bruen Director March 31, 2025 David T. Bruen /s/ James R. Durfey Director March 31, 2025 James R. Durfey /s/ Tracie Hager Director March 31, 2025 Tracie Hager 71 Table of Contents INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB ID 569 ) F-1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB ID 23) FINANCIAL STATEMENTS: Consolidated Balance Sheets F-4 Consolidated Statements of Operations F-5 Consolidated Statements of Equity F-6 Consolidated Statements of Cash Flows F-7 Notes to Consolidated Financial Statements F-8 Financial Statement Schedules: Schedule III - Real Estate Assets and Accumulated Depreciation and Amortization F-39 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Presidio Property Trust, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Presidio Property Trust, Inc (the “Company”) as of December 31, 2024, the related consolidated statements of operations, equity, and cash flows for the year then ended, and the related notes and financial statement Schedule III – Real Estate and Accumulated Depreciation and Amortization (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2024, and the consolidated results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the (consolidated) financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the (consolidated) financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. F-1 Table of Contents Impairment of Real Estate Assets, net The Company’s real estate assets, inclusive of real estate assets held for sale, totaled $127.6 million as of December 31, 2024. As more fully described in Note 2 to the consolidated financial statements, the Company reviews its real estate assets for impairment on a property-by-property basis. Impairment is recognized on a property held for use when the expected undiscounted cash flows for a property are less than the carrying amount at which time the property is written down to fair value. Impairment is recognized on a property held for sale when the fair value less costs to sell is less than the carrying amount. The calculation of both discounted and undiscounted cash flows requires management to make estimates of future cash flows that are determined based on a number of inputs and assumptions such as the intended hold period, market rental rates, leasing assumptions, capitalization rates and discount rates. For the year ended December 31, 2024, the Company recorded approximately $1.8 million of impairment related to its real estate assets. We identified the auditing of the Company’s impairment assessment for real estate assets as a critical audit matter. Auditing the Company’s impairment assessment for real estate assets is especially challenging due to the high degree of auditor judgement, subjectivity, and effort, including the need to involve our valuation specialists, in evaluating management’s identification of indicators of potential impairment for certain real estate assets, and in determining the future cash flows and estimated fair values, where applicable, for certain real estate assets where indicators of impairment were determined to be present. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming an overall opinion on the consolidated financial statements. Our audit procedures related to the matter included the following, among others: ● Evaluating the significant judgments applied in determining whether indicators of impairment were present, including the intended hold period, obtaining evidence to corroborate management’s judgments, and searching for evidence contrary to such judgments. ● Testing the mathematical accuracy of the valuation models for certain real estate assets. ● Involving our valuation professionals with specialized skills and knowledge in (1) evaluating the reasonableness of the valuation methodology and (2) testing the underlying assumptions such as the market rental rates, leasing assumptions, capitalization rates and discount rates used to estimate future cash flows and, where applicable, fair values for certain real estate assets. The evaluation included comparison of Company assumptions to independently developed ranges using market data from industry transaction databases and published industry reports. ● Evaluating whether the assumptions used by management were consistent with evidence obtained in other areas of the audit. /s/ Moss Adams Irvine, California March 31, 2025 We have served as the Company’s auditor since 2024. F-2 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the board of directors of Presidio Property Trust, Inc. and Subsidiaries: Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Presidio Property Trust, Inc. and Subsidiaries (the Company) as of December 31, 2023, the related consolidated statements of operations, equity and cash flows, for the years then ended, and the related notes to the consolidated financial statements and schedule in Item 15 (2), Schedule III – Real Estate and Accumulated Depreciation and Amortization (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Baker Tilly US, LLP Irvine, California April 15, 2024 (March 31, 2025, as to the effects of the adoption of ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , described in Note 2) We began serving as the Company's auditor in 2009. In 2024 we became the predecessor auditor. F-3 Table of Contents Presidio Property Trust, Inc. and Subsidiaries Consolidated Balance Sheets December 31, December 31, 2024 2023 ASSETS Real estate assets and lease intangibles: Land $ 15,983,323 $ 21,660,644 Buildings and improvements 102,862,977 133,829,416 Tenant improvements 16,488,066 17,820,948 Lease intangibles 3,776,654 4,110,139 Real estate assets and lease intangibles held for investment, cost 139,111,020 177,421,147 Accumulated depreciation and amortization ( 33,700,262 ) ( 38,725,356 ) Real estate assets and lease intangibles held for investment, net 105,410,758 138,695,791 Real estate assets held for sale, net 22,185,742 5,459,993 Real estate assets, net 127,596,500 144,155,784 Other assets: Cash, cash equivalents and restricted cash 8,036,496 6,510,428 Deferred leasing costs, net 1,666,135 1,657,055 Goodwill 1,389,000 1,574,000 Investment in Conduit Pharmaceuticals marketable securities (see Notes 2 & 9) 206,177 18,318,521 Deferred tax asset 298,645 346,762 Other assets, net (see Note 6) 3,376,697 3,400,088 Total other assets 14,973,150 31,806,854 TOTAL ASSETS (1) $ 142,569,650 $ 175,962,638 LIABILITIES AND EQUITY Liabilities: Mortgage notes payable, net $ 80,977,448 $ 103,685,444 Mortgage notes payable related to properties held for sale, net 21,116,646 4,027,829 Mortgage notes payable, total net 102,094,094 107,713,273 Accounts payable and accrued liabilities 3,290,170 4,770,845 Accrued real estate taxes 1,972,477 1,953,087 Dividends payable 194,784 174,011 Lease liability, net 64,345 16,086 Below-market leases, net 8,625 13,266 Total liabilities 107,624,495 114,640,568 Commitments and contingencies (see Note 10) Equity: Series D Preferred Stock, $ 0.01 par value per share; 1,000,000 shares authorized; 997,085 shares issued and outstanding (liquidation preference $ 25.00 per share) as of December 31, 2024 and 890,946 shares issued and outstanding as of December 31, 2023 9,971 8,909 Series A Common Stock, $ 0.01 par value per share, shares authorized: 100,000,000 ; 12,834,317 shares and 12,265,061 shares were issued and outstanding at December 31, 2024 and December 31, 2023, respectively 128,343 122,651 Additional paid-in capital 185,770,842 182,331,408 Dividends and accumulated losses ( 159,374,010 ) ( 131,508,785 ) Total stockholders' equity before noncontrolling interest 26,535,146 50,954,183 Noncontrolling interest 8,410,009 10,367,887 Total equity 34,945,155 61,322,070 TOTAL LIABILITIES AND EQUITY $ 142,569,650 $ 175,962,638 (1) As of December 31, 2024 and 2023, includes approximately $11.4 million and $18.1 million, respectively, of assets related to consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities. See Notes to Consolidated Financial Statements F-4 Table of Contents Presidio Property Trust, Inc. and Subsidiaries Consolidated Statements of Operations For the Year Ended December 31, 2024 2023 Revenues: Rental income $ 18,523,813 $ 17,392,397 Fees and other income 401,462 243,217 Total revenue 18,925,275 17,635,614 Costs and expenses: Rental operating costs 6,256,077 5,962,918 General and administrative 7,526,675 6,790,432 Depreciation and amortization 5,515,518 5,425,739 Impairment of goodwill and real estate assets 1,969,311 3,247,097 Total costs and expenses 21,267,581 21,426,186 Other income (expense): Interest expense - mortgage notes ( 6,050,196 ) ( 5,004,889 ) Interest and other income, net ( 151,356 ) 1,435,298 Gain on sales of real estate, net 3,426,572 3,240,200 Net loss in Conduit Pharmaceuticals marketable securities (see footnote 9) ( 17,925,723 ) ( 23,359,774 ) Gain on deconsolidation of SPAC (see footnote 9) — 40,321,483 Income tax (expense) benefit ( 60,855 ) 335,780 Total other (loss) income, net ( 20,761,558 ) 16,968,098 Net (loss) income ( 23,103,864 ) 13,177,526 Less: Income attributable to noncontrolling interests ( 2,524,665 ) ( 3,031,080 ) Net (loss) income attributable to Presidio Property Trust, Inc. stockholders $ ( 25,628,529 ) $ 10,146,446 Less: Preferred Stock Series D dividends ( 2,236,696 ) ( 2,118,846 ) Net (loss) income attributable to Presidio Property Trust, Inc. common stockholders $ ( 27,865,225 ) $ 8,027,600 Net (loss) income per share attributable to Presidio Property Trust, Inc. common stockholders: Basic & Diluted $ ( 2.25 ) $ 0.68 Weighted average number of common shares outstanding - basic & dilutive 12,386,594 11,847,814 See Notes to Consolidated Financial Statements F-5 Table of Contents Presidio Property Trust, Inc. and Subsidiaries Consolidated Statements of Equity Additional Dividends and Total Non- Preferred Stock Series D Common Stock Paid-in Accumulated Stockholders’ controlling Total Shares Amount Shares Amount Capital Losses Equity Interests Equity Balance, December 31, 2022 913,987 9,140 11,807,893 118,079 182,122,213 ( 138,341,750 ) 43,907,682 9,013,446 52,921,128 Net income — — — — — 10,146,446 10,146,446 3,031,080 13,177,526 Dividends paid to Series A common stockholders — — — — — ( 1,194,635 ) ( 1,194,635 ) — ( 1,194,635 ) Dividends to Series D preferred stockholders — — — — — ( 2,118,846 ) ( 2,118,846 ) — ( 2,118,846 ) Distributions in excess of contributions received — — — — — — — ( 1,676,639 ) ( 1,676,639 ) Restricted stock-based compensation — — — — ( 56,867 ) — ( 56,867 ) — ( 56,867 ) Remeasurement of SPAC shares to redemption value — — — — ( 405,994 ) — ( 405,994 ) — ( 405,994 ) Accrued excise tax on SPAC redemptions — — — — ( 1,140,683 ) — ( 1,140,683 ) — ( 1,140,683 ) Reversal of accrued excise tax on SPAC redemptions prior to deconsolidation — — — — 1,140,683 — 1,140,683 — 1,140,683 Repurchase of Series D preferred stock, at cost ( 23,041 ) ( 231 ) — — ( 369,755 ) — ( 369,986 ) — ( 369,986 ) Issuance of stock-based compensation Common Stock — — 27,371 274 28,466 — 28,740 — 28,740 Vesting of restricted stock — — 429,797 4,298 1,013,345 — 1,017,643 — 1,017,643 Balance, December 31, 2023 890,946 $ 8,909 12,265,061 $ 122,651 $ 182,331,408 $ ( 131,508,785 ) $ 50,954,183 $ 10,367,887 $ 61,322,070 Net (loss) income — — — — — ( 25,628,529 ) ( 25,628,529 ) 2,524,665 ( 23,103,864 ) Dividends to Series D preferred stockholders — — — — — ( 2,236,696 ) ( 2,236,696 ) — ( 2,236,696 ) Distributions in excess of contributions received — — — — — — — ( 3,429,964 ) ( 3,429,964 ) Restricted stock-based compensation — — — — 1,379,080 — 1,379,080 — 1,379,080 Repurchase of Series A Common Stock, at cost — — ( 190,640 ) ( 1,905 ) ( 138,511 ) — ( 140,416 ) — ( 140,416 ) Repurchase of Series D preferred stock, at cost ( 2,918 ) ( 29 ) — — ( 40,881 ) — ( 40,910 ) — ( 40,910 ) Issuance of preferred stock Series D preferred stock, net of issuance costs 109,054 1,091 — — 1,194,764 — 1,195,855 — 1,195,855 Issuance of Series A Common Stock — — 86,232 862 1,051,717 — 1,052,579 ( 1,052,579 ) — Vesting of Restricted Series A Common Stock — — 658,839 6,588 ( 6,588 ) — — — — Issuance of stock-based compensation Common Stock — — 164,078 1,640 198,360 — 200,000 — 200,000 Return of stock-based compensation by CEO — — ( 149,253 ) ( 1,493 ) ( 198,507 ) — ( 200,000 ) — ( 200,000 ) Balance, December 31, 2024 997,082 $ 9,971 12,834,317 $ 128,343 $ 185,770,842 $ ( 159,374,010 ) $ 26,535,146 $ 8,410,009 $ 34,945,155 See Notes to Consolidated Financial Statements. F-6 Table of Contents Presidio Property Trust, Inc. and Subsidiaries Consolidated Statements of Cash Flows For the Year Ended December 31, 2024 2023 Cash flows from operating activities: Net (loss) income $ ( 23,103,864 ) 13,177,526 Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: Depreciation and amortization 5,515,518 5,425,739 Stock compensation 1,379,080 989,515 Bad debt expense — 28,880 Gain on sale of real estate assets, net ( 3,426,572 ) ( 3,240,200 ) Gain on deconsolidation of SPAC investment — ( 40,321,483 ) Employee Bonuses paid with CDT stock 172,421 — Net loss in Conduit Pharmaceuticals fair value marketable securities 17,925,723 23,359,774 Net loss (gain) in fair value marketable securities 560 ( 204,878 ) Net change in fair value SPAC Trust Account — ( 1,209,542 ) Impairment of goodwill and real estate assets 1,969,311 3,247,097 Amortization of financing costs 351,291 345,880 Amortization of below-market leases ( 4,641 ) ( 4,974 ) Amortization of deferred leasing costs 7,744 7,744 Straight-line rent adjustment ( 152,722 ) ( 332,055 ) Changes in operating assets and liabilities: Other assets 82,575 ( 211,023 ) Deferred tax asset 48,117 ( 346,762 ) Accounts payable and accrued liabilities ( 1,511,991 ) 11,546 Accounts payable and accrued liabilities for the SPAC — 652,577 Accrued real estate taxes 19,390 73,212 Net cash (used in) provided by operating activities ( 728,060 ) 1,448,573 Cash flows from investing activities: Real estate acquisitions ( 9,729,351 ) ( 21,909,963 ) Additions to buildings and tenant improvements ( 2,273,726 ) ( 6,367,549 ) Investment in marketable securities ( 2,362 ) ( 2,161,724 ) Proceeds from sale of marketable securities 105,206 2,974,910 Investment of SPAC IPO proceeds into Trust Account — ( 624,998 ) Withdrawals from Trust Account for SPAC taxes — 832,480 Withdrawals from Trust Account for Redemption of SPAC Shares — 137,157,011 Proceeds from sales of real estate, net 24,767,052 10,698,386 Net cash provided by investing activities 12,866,819 120,598,553 Cash flows from financing activities: Proceeds from mortgage notes payable, net of issuance costs 22,272,291 20,804,277 Payment of debt issuance costs ( 335,724 ) ( 246,557 ) Repayment of mortgage notes payable ( 27,897,127 ) ( 10,089,026 ) Payment of deferred offering costs — ( 5,000 ) Distributions to noncontrolling interests ( 3,629,964 ) ( 4,201,639 ) Contributions from noncontrolling interests 200,000 2,525,000 Redemption of SPAC shares — ( 137,157,011 ) Issuance of Series D Preferred Stock, net of offering costs 1,195,855 — Repurchase of Series A Common Stock, at cost ( 140,416 ) — Repurchase of Series D Preferred Stock, at cost ( 40,910 ) ( 369,986 ) Dividends paid to Series D Preferred Stockholders ( 2,236,696 ) ( 2,118,846 ) Dividends paid to Series A Common Stockholders — ( 1,194,635 ) Net cash (used in) financing activities ( 10,612,691 ) ( 132,053,423 ) Net (decrease) increase in cash equivalents and restricted cash 1,526,068 ( 10,006,297 ) Cash, cash equivalents and restricted cash - beginning of period 6,510,428 16,516,725 Cash, cash equivalents and restricted cash - end of period $ 8,036,496 $ 6,510,428 Supplemental disclosure of cash flow information: Interest paid-mortgage notes payable $ 5,371,017 $ 4,962,458 Income taxes paid $ 46,511 $ 533,340 Non-cash investing activities: Private warrants from Conduit Pharmaceuticals $ 642,600 $ — Non-cash financing activities: Unpaid building and tenant improvements $ 207,847 $ 295,567 Dividends payable - Preferred Stock Series D $ 194,784 $ 174,011 See Notes to Consolidated Financial Statements F-7 Table of Contents Presidio Property Trust, Inc. and Subsidiaries Notes to Consolidated Financial Statements 1. ORGANIZATION AND BASIS OF PRESENTATION Organization . Presidio Property Trust, Inc. (“we”, “our”, “us” or the “Company”) is an internally-managed real estate investment trust (“REIT”), with holdings in office, industrial, retail and model home properties. We were incorporated in the State of California on September 28, 1999, and in August 2010, we reincorporated as a Maryland corporation. In October 2017, we changed our name from “NetREIT, Inc.” to “Presidio Property Trust, Inc.” Through Presidio Property Trust, Inc., its subsidiaries, and its partnerships, we own 12 commercial properties in fee interest, two of which we own as a partial interest in various affiliates, in which we serve as general partner, member and/or manager, and a special purpose acquisition company (until deconsolidation in September 2023) as noted below. The Company or one of its affiliates operates the following partnerships during the periods covered by these consolidated financial statements: • The Company is the sole general partner and limited partner in two limited partnerships (NetREIT Palm Self-Storage LP and NetREIT Casa Grande LP), both of which, at December 31, 2024 , had ownership interests in an entity that owns income producing real estate. The Company refers to these entities collectively as the "NetREIT Partnerships". • The Company is the general and limited partner in six limited partnerships that purchase model homes and lease them back to homebuilders as commercial tenants (Dubose Model Home Investors #202, LP, Dubose Model Home Investors #203, LP, Dubose Model Home Investors #204, LP, Dubose Model Home Investors #205, LP, Dubose Model Home Investors #206, LP, and Dubose Model Home Investors #207, LP). The Company refers to these entities collectively as the "Model Home Partnerships". The Company has determined that the limited partnerships in which it owns less than 100% should be included in the Company’s consolidated financial statements as the Company directs their activities and has control of such limited partnerships. Unit-based information used herein (such as references to square footage or property occupancy rates) is unaudited. We have elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), for federal income tax purposes. To maintain our qualification as a REIT, we are required to distribute at least 90% of our REIT taxable income to our stockholders and meet the various other requirements imposed by the Code relating to such matters as operating results, asset holdings, distribution levels, and diversity of stock ownership. Provided we maintain our qualification for taxation as a REIT, we are generally not subject to corporate-level income tax on the earnings distributed currently to our stockholders that we derive from our REIT qualifying activities. If we fail to maintain our qualification as a REIT in any taxable year and are unable to avail ourselves of certain savings provisions set forth in the Code, all our taxable income would be subject to federal income tax at regular corporate rates, including any applicable alternative minimum tax. We are subject to certain state and local income taxes. We, together with one of our entities, have elected to treat certain subsidiaries as a taxable REIT subsidiary (a “TRS”) for federal income tax purposes. Certain activities that we undertake must be conducted by a TRS, such as non-customary services for our commercial tenants, and holding assets that we cannot hold directly. A TRS is subject to federal and state income taxes. The Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. Neither the Company nor its subsidiaries have been assessed any significant interest or penalties for tax positions by any tax jurisdictions. F- 8 Table of Contents Liquidity. The Company's anticipated future sources of liquidity may include existing cash and cash equivalents, cash flows from operations, refinancing of existing mortgages, future real estate sales, new borrowings, and the sale of equity or debt securities. Future capital needs include paying down existing borrowings, maintaining our existing properties, funding tenant improvements on our commercial buildings, paying lease commissions (to the extent they are not covered by lender-held reserve deposits), and the payment of dividends to our stockholders. The Company is also seeking investments that are likely to produce income and achieve long-term gains in order to pay dividends to our stockholders. To ensure that we can effectively execute these objectives, we routinely review our liquidity requirements and continually evaluate all potential sources of liquidity. If necessary, the Company may seek other short-term liquidity alternatives, such as bridge loans, refinancing an unencumbered property or a bank line of credit depending on the credit environment. See note 10 Stockholders' Equity for additional information on sale of securities. Short-term liquidity needs include paying our current operating costs, satisfying the debt service requirements of existing mortgages, completing tenant improvements on our commercial buildings, paying leasing commissions, distributions to non-controlling interests, and funding dividends, if any, to stockholders. Future principal payments due on mortgage notes payables, during the year ended December 31, 2025 total approximately $ 38.8 million of which $ 8.3 million is related to model home properties. See Note 7. Mortgage Notes Payable for additional information on the Dakota Center loan that matured on July 6, 2024. Management expects certain model home properties can be sold, and that the underlying mortgage notes will be paid off with sales proceeds while other mortgage notes can be refinanced, as the Company has historically been able to do in the past with all model home properties. Additional principal payments will be made with cash flows from ongoing operations. As the Company continues its operations, it may re-finance or seek additional financing. However, there can be no assurance that any such re-financing or additional financing will be available to the Company on acceptable terms, if at all. If events or circumstances occur such that the Company does not obtain additional funding, it will most likely be required to reduce its plans and/or certain discretionary spending, which could have a material adverse effect on the Company's ability to achieve its intended business objectives. Management believes that the combination of working capital on hand and the ability to refinance commercial and model home mortgages will fund operations through at least the next twelve months from the date of the issuance of these unaudited interim financial statements. Segments. The Company acquires and operates income producing properties in three business segments including Office/Industrial Properties, Model Home Properties and Retail Properties. See Note 13. “Segments”. Concentration. Concentration of credit risk with respect to tenant receivables is limited due to the large number of tenants comprising the Company’s rental revenue. We have five commercial properties located in Colorado, four in North Dakota, one in Southern California, one in Texas and one in Maryland. Our model home properties are concentrated in Texas with a few model homes in Florida and Arizona. We had one tenant account for 6.07 % of total rental income for the year ended December 31, 2024 . On December 31, 2022, the lease for our largest tenant at that time, Halliburton Energy Services, Inc. ("Halliburton"), expired. Halliburton was located in our Shea Center II property in Colorado and did not renew the lease. We placed approximately $ 1.1 million in a reserve account with our lender to cover future mortgage payments, if necessary, in connection with Halliburton's vacant space, none of which has been used as of December 31, 2024 . This reserve amount is included in "Cash, cash equivalents and restricted cash" on the consolidated balance sheet. Our management team is working to fill the 45,535 square foot space and has leased approximately 54% of the space as of February 2025 and has reviewed various proposals for the remaining 46%. The following table sets forth certain information with respect to our top 10 tenants at our Office/Industrial and Retail Properties. As of December 31, 2024 Tenant Number of Leases Annualized Base Rent % of Total Annualized Base Rent John Hopkins University 1 724,453 6.07 % Finastra USA Corporation 1 543,600 4.55 % KLJ Engineering LLC 1 536,080 4.49 % MasTec North America, Inc. 1 371,106 3.11 % L&T Care LLC 1 342,692 2.87 % Wells Fargo Bank, NA 1 300,838 2.52 % Republic Indemnity of America 1 278,831 2.34 % Nova Financial & Investment Corporation (1) 1 275,071 2.30 % Meissner Commercial Real Estate Services (2) 1 270,015 2.26 % Fredrikson & Byron P.A. 1 249,270 2.09 % $ 3,891,956 32.60 % F- 9 Table of Contents ( 1 ) Nova Financial & Investment Corporation was subleasing to OnPoint Medical Group Holdings, LLC (“OnPoint”), until their lease expired in January 2025. Since October 2024, OnPoint had also been directly leasing a 2,543 square foot space in our Shea Center building. In January 2025, OnPoint took over 11,831 square foot space from Nova Financial & Investment Corporation, signing an additional 3 -year lease for that space. ( 2 ) Genesis Plaza's occupancy at December 31, 2024 was at 95.6 %. During the year, the Company invested approximately $74k in building and tenant improvements for the property, expanded the space for Meissner and extended the term of their lease to 2035, and reduced the space used by the Company. On January 1, 2025, Meissner took possession of the expanded space and Genesis Plaza was 100 % leased. 2. SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). Principles of Consolidation . The accompanying consolidated financial statements include the accounts of Presidio Property Trust, Inc. and its subsidiaries, NetREIT Advisors, LLC and Dubose Advisors LLC (collectively, the “Advisors”), and NetREIT Dubose Model Home REIT, Inc. The consolidated financial statements also include the results of the NetREIT Partnerships and the Model Home Partnerships. As used herein, references to the “Company” include references to Presidio Property Trust, Inc., its subsidiaries, and the partnerships. All significant intercompany balances and transactions have been eliminated in consolidation. The consolidated financial statements also include the accounts of Murphy Canyon up until September 22, 2023, when it completed its business combination. Murphy Canyon was a special purpose acquisition company ("SPAC") for which we served as the financial sponsor (as described herein), and which was deemed to be controlled by us as a result of our 65 % equity ownership stake, the overlap of three of our executive officers as executive officers of Murphy Canyon, and significant influence that we exercised over the funding and acquisition of new operations for an initial business combination (see Note 2, Variable Interest Entity). All intercompany balances, prior to deconsolidation and loss of control on September 22, 2023, have been eliminated in consolidation. The Company classifies the noncontrolling interests in the NetREIT Partnerships as part of consolidated net (loss) income in 2024 and 2023 and has included the accumulated amount of noncontrolling interests as part of equity since inception in February 2010. If a change in ownership of a consolidated subsidiary results in loss of control and deconsolidation, any retained ownership interest will be remeasured, with the gain or loss reported in the consolidated statements of operations. Management has evaluated the noncontrolling interests and determined that they do not contain any redemption features. Use of Estimates . The consolidated financial statements were prepared in conformity with U.S. GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant estimates include, private warrants, the allocation of purchase price paid for property acquisitions between the components of land, building and intangible assets acquired including their useful lives, valuation of long-lived assets, and the allowance for doubtful accounts, which is based on an evaluation of the tenants’ ability to pay. Actual results could differ from those estimates. Real Estate Assets and Lease Intangibles. Land, buildings and improvements are recorded at cost, including tenant improvements and lease acquisition costs (including leasing commissions, space planning fees, and legal fees). The Company capitalizes any expenditure that replaces, improves, or otherwise extends the economic life of an asset, while ordinary repairs and maintenance are expensed as incurred. The Company allocates the purchase price of acquired properties between the acquired tangible assets and liabilities (consisting of land, buildings, tenant improvements, and long-term debt) and identified intangible assets and liabilities (including the value of above-market and below-market leases, the value of in-place leases, unamortized lease origination costs and tenant relationships), in each case based on their respective fair values. F- 10 Table of Contents The Company allocates the purchase price to tangible assets of an acquired property based on the estimated fair values of those tangible assets, assuming the property was vacant. Estimates of fair value for land, building and building improvements are based on many factors, including, but not limited to, comparisons to other properties sold in the same geographic area and independent third -party valuations. In estimating the fair values of the tangible assets, intangible assets, and liabilities acquired, the Company also considers information obtained about each property as a result of its pre‑acquisition due diligence, marketing and leasing activities. The value allocated to acquired lease intangibles is based on management’s evaluation of the specific characteristics of each tenant’s lease. Characteristics considered by management in allocating these values include, but are not limited, to the nature and extent of the existing business relationships with the tenant, growth prospects for developing new business with the tenant, the remaining term of the lease, the tenant’s credit quality, and other factors. The value attributable to the above-market or below-market component of an acquired in-place lease is determined based upon the present value (using a market discount rate) of the difference between (i) the contractual rents to be paid pursuant to the lease over its remaining term, and (ii) management’s estimate of rents that would be paid using fair market rates over the remaining term of the lease. The amounts allocated to above or below-market leases are amortized on a straight-line basis as an increase or reduction of rental income over the remaining non-cancelable term of the respective leases. Amortization of above and below-market rents resulted in a net increase in rental income of approximately $ 4,641 and $ 4,974 for the years ended December 31, 2024 and 2023 , respectively. The value of in-place leases and unamortized lease origination costs are amortized to expenses over the remaining term of the respective leases, which range from less than a year to ten years. The amount allocated to acquired in-place leases is determined based on management’s assessment of lost revenue and costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased. The amount allocated to unamortized lease origination costs is determined by what the Company would have paid to a third -party to secure a new tenant reduced by the expired term of the respective lease. The amount allocated to tenant relationships is the benefit resulting from the likelihood of a tenant renewing its lease. Amortization expense related to these assets was approximately $ 17,526 and $ 17,526 for years ended December 31, 2024 and 2023 , respectively. Real Estate Held for Sale and Discontinued Operations. We generally reclassify assets to "held for sale" when the disposition has been approved, it is available for immediate sale in its present condition, we are actively seeking a buyer, and the disposition is considered probable within one year. Additionally, real estate sold during the current period is classified as “real estate assets held for sale” for all prior periods presented in the accompanying consolidated financial statements. Mortgage notes payable related to the real estate sold during the current period are classified as “mortgage notes payable related to properties held for sale” for all prior periods presented in the accompanying consolidated financial statements. Additionally, we record the operating results related to real estate that has been disposed of as discontinued operations for all periods presented if the operations have been eliminated and represent a strategic shift and we will not have any significant continuing involvement in the operations of the property following the sale. Properties considered held for sale are recorded at the lesser of the carrying value or fair value less costs to sell. As of December 31, 2024 , three commercial properties, Union Town Center, Research Parkway, and Dakota Center met the criteria to be classified as "held for sale", and 9 model homes were classified as "held for sale", but are not considered discontinued operations or a strategic shift in our operations. Impairments of Real Estate Assets. We regularly review for impairment on a property-by-property basis. Impairment is recognized on a property held for use when the expected undiscounted cash flows for a property are less than the carrying amount at which time the property is written-down to fair value. Impairment is recognized on a property held for sale when the fair value less costs to sell is less than the carrying amount. The calculation of both discounted and undiscounted cash flows requires management to make estimates of future cash flows that are determined based on a number of inputs and assumptions such as the intended hold period, market rental rates, leasing assumptions, capitalization rates and discount rates. Actual results could be significantly different from the estimates. Although our strategy is to hold our properties over the long-term, if our strategy changes or market conditions otherwise dictate an earlier sale date, an impairment loss may be recognized to reduce the property to fair value and such loss could be material. F- 11 Table of Contents We review the carrying value of each of our real estate properties regularly to determine if circumstances indicate an impairment in the carrying value of these investments exists. During the year ended December 31, 2024 , we recognized non-cash impairment charges of approximately $ 1.8 million, with approximately $ 0.4 million related to model homes and approximately $ 1.4 million related to our commercial properties Dakota Center and 300 NP. The impairment on our commercial property, Dakota Center, was the result of the loan maturing in July and the Company not being able to reach an agreement with the lenders regarding a loan modification or extension. In October, the lender has agreed to a sale of the property to settle the balance of the non-recourse loan. Due to the uncertainties in the Fargo market, we decided to impair the property’s book value, in accordance with ASC 360 - 10. As such, for the year ended December 31, 2024, we recorded an impairment charge of approximately $ 0.7 million. The impairment on 300 NP, totaling approximately $ 0.7 million, for the year ended December 31, 2024, related to changing cap rates in the area and low historical occupancy. This property is not listed for sale and has no debt. Intangible Assets . Intangible assets, including goodwill and lease intangibles, are comprised of finite-lived and indefinite-lived assets. Lease intangibles represent the allocation of a portion of the purchase price of a property acquisition representing the estimated value of in-place leases, unamortized lease origination costs, tenant relationships and land purchase options. Intangible assets that are not deemed to have an indefinite useful life are amortized over their estimated useful lives. Indefinite-lived assets are not amortized. Amortization expense of intangible assets that are not deemed to have an indefinite useful life was approximately and , respectively, for the years ended December 31, 2024 and 2023 and is included in depreciation and amortization in the accompanying consolidated statements of operation. The Company is required to perform a test for impairment of goodwill and other definite and indefinite lived assets at least annually, and more frequently as circumstances warrant. Impairment is recognized only if the carrying amount of the intangible asset is considered to be unrecoverable from its undiscounted cash flows and is measured as the difference between the carrying amount and the estimated fair value of the asset. For the year ended December 31, 2024, we have recorded an impairment charge to the goodwill of NTR Property Management for approximately $ 0.2 million. See Fair Value Measurements below for additional information. Depreciation and Amortization. The Company records depreciation and amortization expense using the straight-line method over the useful lives of the respective assets. The costs of buildings are depreciated over estimated useful lives of 39 years, the costs of improvements are amortized over the shorter of the estimated life of the asset or term of the tenant lease (which range from 1 to 10 years), the costs associated with acquired tenant intangibles over the remaining lease term and the cost of furniture, fixtures and equipment are depreciated over 4 to 5 years. Depreciation and amortization expense for the years ended December 31, 2024 and 2023 was approximately $ 5.5 million and $ 5.4 million, respectively, and is included in depreciation and amortization in the accompanying consolidated statements of operations. Cash, Cash Equivalents and Restricted Cash. At December 31, 2024 and December 31, 2023 , we had approximately $ 8.0 million and $ 6.5 million in cash, cash equivalents and restricted cash, respectively. The Company considers all short-term, highly liquid investments that are both readily convertible to cash and have an original maturity of three months or less at the date of purchase to be cash equivalents. Items classified as cash equivalents include money market funds. Cash balances in individual banks may exceed the federally insured limit of $250,000 by the Federal Deposit Insurance Corporation (the "FDIC"). No losses have been experienced related to such accounts. At December 31, 2024 , the Company had approximately $ 1.0 million in deposits in financial institutions that exceeded the federally insurable limits. Restricted cash consists of funds held in escrow for Company lenders for properties held as collateral by the lenders. The funds in escrow are for payment of property taxes, insurance, leasing costs, mortgage payment reserves, and capital expenditures. As of December 31, 2024 , the Company has approximately $ 5.0 million of restricted cash. At December 31, 2023 , the Company had approximately $ 0.7 million in deposits in financial institutions that exceeded the federally insurable limits. As of December 31, 2023 , the Company has approximately $ 3.7 million of restricted cash. F- 12 Table of Contents Accounts Receivables. The Company periodically evaluates the collectability of amounts due from tenants and maintains an allowance for doubtful accounts for estimated losses resulting from the inability of tenants to make required payments under lease agreements. In addition, the Company maintains an allowance for deferred rent receivable that arises from straight lining of rents. The Company exercises judgment in establishing these allowances and considers payment history and current credit status of its tenants in developing these estimates. As of December 31, 2024 and 2023 , the balance of allowance for possible uncollectable tenant receivables included in other assets, net in the accompanying consolidated balance sheets was approximately $ 0 and $ 91,718 , respectively. Deferred Leasing Costs. Costs incurred in connection with successful property leases are capitalized as deferred leasing costs and amortized to leasing commission expense on a straight-line basis over the terms of the related leases which generally range from one to five years. Deferred leasing costs consist of third -party leasing commissions. Management re-evaluates the remaining useful lives of leasing costs as the creditworthiness of the tenants and economic and market conditions change. If management determines the estimated remaining life of the respective lease has changed, the amortization period is adjusted. At December 31, 2024 and 2023 , the Company had net deferred leasing costs of approximately $ 1.7 million and $ 1.7 million, respectively. Total amortization expense for the years ended December 31, 2024 and 2023 was approximately $ 0.5 million and $ 0.5 million, respectively, and is included in the total for depreciation and amortization noted above. Deferred Financing Costs. Costs incurred, including legal fees, origination fees, and administrative fees, in connection with debt financing are capitalized as deferred financing costs, are amortized using the straight line method, which approximates the effective interest method, over the contractual term of the respective loans and recorded as an offset to the carrying value of the debt. At December 31, 2024 and 2023 , unamortized deferred financing costs related to mortgage notes payable were approximately $ 0.7 million and $ 0.8 million. For the years ended December 31, 2024 and 2023 , total amortization expense related to the mortgage notes payable deferred financing costs was approximately $ 0.4 million and $ 0.3 million, respectively. Amortization of deferred financing costs are included in interest expense in the accompanying consolidated statements of operations. Deferred Offering Costs. Deferred offering costs represent legal, accounting and other direct costs related to our offerings. As of December 31, 2024 and 2023 , we have incurred approximately zero and $ 5,000 , respectively, in deferred offering costs as of the end of each period related to our registration statement on Form S- 3. Income Taxes. We have elected to be taxed as a REIT under Sections 856 through 860 of the Code, for federal income tax purposes. To maintain our qualification as a REIT, we are required to distribute at least 90 % of our REIT taxable income to our stockholders and meet the various other requirements imposed by the Code relating to such matters as operating results, asset holdings, distribution levels and diversity of stock ownership. Provided we maintain our qualification for taxation as a REIT, we are generally not subject to corporate level income tax on the earnings distributed currently to our stockholders that we derive from our REIT qualifying activities. If we fail to maintain our qualification as a REIT in any taxable year, and are unable to avail ourselves of certain savings provisions set forth in the Code, all of our taxable income would be subject to federal income tax at regular corporate rates, including any applicable alternative minimum tax. We are subject to certain state and local income taxes. As of December 31, 2024 , we have estimated approximately $ 18.0 million of Federal net operating loss (NOLs) carryforwards to offset potential future federal tax obligations. We may not generate sufficient taxable income in future periods to be able to realize fully the tax benefits of our NOL carry-forwards. We, together with one of our entities, have elected to treat certain subsidiaries as a taxable REIT subsidiary (a “TRS”) for federal income tax purposes. Certain activities that we undertake must be conducted by a TRS, such as non-customary services for our tenants, and holding assets that we cannot hold directly. A TRS is subject to federal and state income taxes. The Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. Neither the Company nor its subsidiaries have been assessed any significant interest or penalties for tax positions by any tax jurisdictions. Fair Value Measurements . Certain assets and liabilities are required to be carried at fair value, or if long-lived assets are deemed to be impaired, to be adjusted to reflect this condition. The guidance requires disclosure of fair values calculated under each level of inputs within the following hierarchy: F- 13 Table of Contents • Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; • Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and • Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable. When available, we utilize quoted market prices from independent third -party sources to determine fair value and classify such items in Level 1 or Level 2 . In instances where the market for a financial instrument is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require us to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third -party may rely more on models with inputs based on information available only to that independent third -party. When we determine the market for a financial instrument owned by us to be illiquid or when market transactions for similar instruments do not appear orderly, we use several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and establish a fair value by assigning weights to the various valuation sources. Additionally, in an inactive market, a market price quoted from an independent third -party may rely more on models with inputs based on information available only to that independent third -party. When we determine the market for a financial instrument owned by us to be illiquid or when market transactions for similar instruments do not appear orderly, we use several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and establish a fair value by assigning weights to the various valuation sources. As of December 31, 2024 , we did not hold any marketable securities, excluding our investments in Conduit's common stock and common stock warrants. As of December 31, 2023 , our marketable securities (excluding our investments in Conduit's common stock and common stock warrants), held at a third party broker, presented on the consolidated balance sheets within other assets were measured at fair value using Level 1 market prices and totaled approximately $ 45,149 , with a cost basis of approximately $ 40,315 . There were no financial liabilities measured at fair value as of December 31, 2024 and December 31, 2023 . On April 22, 2024, the Company entered into a lockup agreement with Conduit pursuant to which the Company agreed not to transfer or sell 2,700,000 of its 4,015,250 shares of Conduit common stock for a period of one year. In consideration for entering into the lockup agreement, Conduit issued the Company a warrant ("Private CDT Warrants") to purchase 540,000 shares of common stock at an exercise price of $ 3.12 per share, with a two year term and exercisable one year after the date of issue. The Private CDT Warrants meet the ASC 321, Investments - Equity Securities ("ASC 321" ) scope exception for derivative instruments and are accounted for as a derivative under ASC 815, Derivatives and Hedging ("ASC 815" ). As such, the Private CDT Warrants were recorded at fair value on the date of issuance and subsequently measured at fair value each period, with changes in fair value reported in gain or loss on Conduit Pharmaceuticals marketable securities. As of April 22, 2024, the Private CDT Warrants were valued at $ 891,000 based on a Level 3 fair value measurement. As of December 31, 2024 , the Private CDT Warrants fair value was adjusted to zero , and is included in the total Investment in Conduit Pharmaceuticals marketable securities on the December 31, 2024 consolidated balance sheet. Our investments in Conduit's common stock (CDT) and public common stock warrants (CDTTW) presented on the consolidated balance sheets were measured at fair value using Level 1 market prices, taking into account the adoption of ASU 2022 - 03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions , and totaled approximately $ 0.2 million as of December 31, 2024 . The combined value of our Investment in Conduit Pharmaceuticals marketable securities, including the Private CDT Warrants, totaled $ 0.2 million as of December 31, 2024 . Our investments in Conduit's common stock and public common stock warrants presented on the consolidated balance sheet were measured at fair value using Level 1 market prices as of December 31, 2023 , and totaled approximately $ 18.3 million. The adjustments to the fair value of our investment in Conduit Pharmaceuticals marketable securities are recorded in net loss in Conduit Pharmaceuticals marketable securities on our consolidated statement of operations. F- 14 Table of Contents The following table presents as of December 31, 2024 the Company’s assets subject to measurement at fair value on a nonrecurring basis (in thousands): Fair Value Measurements as of December 31, 2024 Level 1 Level 2 Level 3 Total Impairment Loss Assets: Goodwill for Dubose Model Homes $ - $ - $ 1,123,000 $ 1,123,000 $ - Goodwill for NTR Property Management - - 266,000 266,000 185,000 Certain Real Estate assets - - 18,065,871 18,065,871 1,784,311 Total Assets $ - $ - $ 19,454,871 $ 19,454,871 $ 1,969,311 The following table presents as of December 31, 2023 the Company’s assets subject to measurement at fair value on a nonrecurring basis (in thousands): Fair Value Measurements as of December 31, 2023 Level 1 Level 2 Level 3 Total Impairment Loss Assets: Goodwill for Dubose Model Homes $ - $ - $ 1,123,000 $ 1,123,000 $ - Goodwill for NTR Property Management - - 451,000 451,000 849,000 Certain Real Estate assets - - 12,503,176 12,503,176 2,398,097 Total Assets $ - $ - $ 14,077,176 $ 14,077,176 $ 3,247,097 Earnings per share ( “ EPS ” ). The EPS on common stock has been computed pursuant to the guidance in FASB ASC Topic 260, Earnings Per Share. The guidance requires the classification of the Company’s unvested restricted stock, which contains rights to receive non-forfeitable dividends, as participating securities requiring the two -class method of computing net income per share of common stock. In accordance with the two -class method, earnings per share have been computed by dividing the net income less net income attributable to unvested restricted shares by the weighted average number of shares of common stock outstanding less unvested restricted shares. Diluted earnings per share is computed by dividing net income by the weighted average shares of common stock and potentially dilutive securities outstanding in accordance with the treasury stock method. Dilutive common stock equivalents include the dilutive effect of in-the-money stock equivalents, which are calculated based on the average share price for each period using the treasury stock method, excluding any common stock equivalents if their effect would be anti-dilutive. In periods in which a net loss has been incurred, all potentially dilutive common stock shares are considered anti-dilutive and thus are excluded from the calculation. Securities that are excluded from the calculation of weighted average dilutive common stock, because their inclusion would have been antidilutive, are: For the Year Ended December 31, 2024 2023 Common Stock Warrants 2,000,000 2,000,000 Placement Agent Warrants 80,000 80,000 Series A Warrants 14,450,069 14,450,069 Unvested Common Stock Grants 1,170,805 760,995 Total potentially dilutive shares 17,700,874 17,291,064 F- 15 Table of Contents Income (Loss) per Common Share. Basic income (loss) per common share (Basic EPS) is computed by dividing net income (loss) available to common shareholders (Numerator) by the weighted average number of common shares outstanding (Denominator) during the period. Diluted loss per common share (Diluted EPS) is similar to the computation of Basic EPS except that the Denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. In addition, in computing the dilutive effect of convertible securities, the Numerator is adjusted to add back the after-tax amount of interest recognized in the period associated with any convertible debt. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net earnings per share. For the year ended December 31, 2024 , the basic and diluted net loss per share was $ 2.25 , since all potentially dilutive securities were determined to be anti-dilutive, and for the year ended December 31, 2023 the basic and diluted net earnings per share are equivalent at $ 0.68 per share because the Company had incurred a net loss attributable to common stockholders causing any potentially dilutive securities to be anti-dilutive. Sales of Real Estate Assets . Effective January 1, 2018, we adopted the guidance of ASC 610 - 20, Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (“ASC 610 - 20” ), which applies to sales or transfers to noncustomers of nonfinancial assets or in substance nonfinancial assets that do not meet the definition of a business. Generally, our sales of real estate would be considered a sale of a nonfinancial asset as defined by ASC 610 - 20. ASC 610 - 20 refers to the revenue recognition principles under ASU No. 2014 - 9. Under ASC 610 - 20, if we determine we do not have a controlling financial interest in the entity that holds the asset and the arrangement meets the criteria to be accounted for as a contract, we would derecognize the asset and recognize a gain or loss on the sale of the real estate when control of the underlying asset transfers to the buyer. Revenue Recognition and Accounts Receivables . We recognize minimum rent, including rental abatements, lease incentives and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the related leases when collectability is reasonably assured and record amounts expected to be received in later years as deferred rent receivable. Additionally, we recognize transaction fees associated with the leasing of our model homes on a straight-line basis over the term of the related leases, and are included within rental income on our consolidated statement of operations. If the lease provides for tenant improvements, we determine whether the tenant improvements, for accounting purposes, are owned by the tenant or by us. When we are the owner of the tenant improvements, rental revenue begins when the tenant takes possession or has control of the physical use of the leased space and any tenant improvement allowance, the tenant is not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements are substantially completed. When the tenant is the owner of the tenant improvements, any tenant improvement allowance (including amounts that the tenant can take in the form of cash or a credit against its rent) that is funded is treated as a lease incentive and amortized as a reduction of revenue over the lease term. Tenant improvement ownership is determined based on various factors, including, but not limited to: • whether the lease stipulates how a tenant improvement allowance may be spent; • whether the amount of a tenant improvement allowance is in excess of market rates; • whether the tenant or landlord retains legal title to the improvements at the end of the lease term; • whether the tenant improvements are unique to the tenant or general-purpose in nature; and • whether the tenant improvements are expected to have any residual value at the end of the lease. We record property operating expense reimbursements due from tenants for common area maintenance, real estate taxes, and other recoverable costs in the period the related expenses are incurred. We make estimates of the collectability of our tenant receivables related to base rents, including deferred rent receivable, expense reimbursements and other revenue or income. We specifically analyze accounts receivable, deferred rent receivable, historical bad debts, customer creditworthiness, current economic trends and changes in customer payment terms when evaluating the adequacy of the allowance for doubtful accounts. In addition, with respect to tenants in bankruptcy, management makes estimates of the expected recovery of pre-petition and post-petition claims in assessing the estimated collectability of the related receivable. In some cases, the ultimate resolution of these claims can exceed one year. When a tenant is in bankruptcy, we will record a bad debt reserve for the tenant’s receivable balance and generally will not recognize subsequent rental revenue until cash is received or until the tenant is no longer in bankruptcy and has the ability to make rental payments. F- 16 Table of Contents Variable Interest Entity. We determine whether an entity is a Variable Interest Entity ("VIE") and, if so, whether it should be consolidated by utilizing judgments and estimates that are inherently subjective. Our determination of whether an entity in which we hold a direct or indirect variable interest is a VIE is based on several factors, including whether we participated in the design of the entity and the entity’s total equity investment at risk upon inception is sufficient to finance the entity’s activities without additional subordinated financial support. We make judgments regarding the sufficiency of the equity at risk based first on a qualitative analysis, and then a quantitative analysis, if necessary. We analyze any investments in VIEs to determine if we are the primary beneficiary. In evaluating whether we are the primary beneficiary, we evaluate our direct and indirect economic interests in the entity. A reporting entity is determined to be the primary beneficiary if it holds a controlling financial interest in the VIE. Determining which reporting entity, if any, has a controlling financial interest in a VIE is primarily a qualitative approach focused on identifying which reporting entity has both: (i) the power to direct the activities of a VIE that most significantly impact such entity’s economic performance; and (ii) the obligation to absorb losses or the right to receive benefits from such entity that could potentially be significant to such entity. Performance of that analysis requires the exercise of judgment. We consider a variety of factors in identifying the entity that holds the power to direct matters that most significantly impact the VIE’s economic performance, including, but not limited to, the ability to direct operating decisions and activities. In addition, we consider the rights of other investors to participate in those decisions. We determine whether we are the primary beneficiary of a VIE at the time we become involved with a variable interest entity and reconsider that conclusion continually. We consolidate any VIE of which we are the primary beneficiary. The Company was involved in the formation of an entity considered to be a VIE, prior to September 22, 2023, when Murphy Canyon completed its business combination. The Company evaluated the consolidation of this entity as required pursuant to ASC Topic 810 relating to the consolidation of such VIE. The Company’s determination of whether it is the primary beneficiary of the VIE is based in part on an assessment of whether or not the Company and its related parties have the power to direct activities of the VIE and are exposed to the majority of the risks and rewards of the entity. Following the completion of the Murphy Canyon IPO in January 2022, we determined that Murphy Canyon was a VIE in which we had a variable interest because we participated in its formation and design, manage the significant activities, and Murphy Canyon did not have enough equity at risk to finance its activities without additional subordinated financial support. We have also determined that Murphy Canyon's public stockholders did not have substantive rights, and their equity interest constituted temporary equity, outside of permanent equity, in accordance with ASC 480 - 10 - S99 - 3A. As such, we have concluded that, prior to the business combination, we were the primary beneficiary of Murphy Canyon as a VIE, as we had the right to receive benefits or the obligation to absorb losses of the entity, as well as the power to direct a majority of the activities that significantly impacted Murphy Canyon's economic performance. Since we were the primary beneficiary, Murphy Canyon was consolidated into our consolidated financial statements. See Note 9 Investment in Conduit Pharmaceuticals for additional details regarding Murphy Canyon. Shares Subject to Possible Redemption . Given that the shares of Murphy Canyon Class A common stock issued to investors in its IPO were issued with other freestanding instruments (i.e., public warrants which were classified as permanent equity as described below), the proceeds and initial carrying value of the Class A common stock classified as temporary equity was allocated in accordance with ASC 470 - 20. The Murphy Canyon Class A common stock was subject to ASC 480 - 10 - S99. In addition, because it was probable that the equity instrument would become redeemable, we had the option to either (i) accrete changes in the redemption value over the period from the date of issuance (or from the date that it became probable that the instrument will become redeemable, if later) to the earliest redemption date of the instrument or (ii) recognize changes in the redemption value immediately as they occurred and adjust the carrying amount of the instrument to equal the redemption value at the end of each reporting period. We elected to recognize the accretion resulting from changes in redemption value immediately during the three months ended March 31, 2022, and every quarter since then, until September 22, 2023 as noted above. See Note 9 Investment in Conduit Pharmaceuticals for additional details regarding Murphy Canyon. Excise Tax . In accordance with the Inflation Reduction Act of 2022, the Company accrues the expected excise tax obligation at the end of each reporting period as a cost of redeeming any shares as of that date. In connection with the vote to approve the Charter Amendment Proposal for the SPAC, holders of 11,037,272 shares of SPAC Class A Common Stock properly exercised their right to redeem their shares of Class A Common Stock for the aggregate redemption amount of $ 114,068,280 . As such the SPAC had recorded a 1 % excise tax liability in the amount of $ 1,140,683 during January 2023. The liability did not impact the statements of operations or statement cash flows and is an offset against additional paid in capital, to the extent available, and accumulated deficit. On September 22, 2023, Murphy Canyon completed its business combination with Conduit Pharma and shareholders and debtholders of Conduit Pharma were issued 65,000,000 shares of Conduit common stock. The excise tax liability recorded in connection with the January 2023 redemptions was reversed in full by the issuance of Conduit shares on September 22, 2023. F- 17 Table of Contents Immaterial Error Corrections . During the second quarter of 2024, management determined that its prior treatment of accruing restricted compensation expense as a liability and included in accounts payable and accrued liabilities on the consolidated balance sheets should be treated differently. Management determined that the restricted stock compensation should be treated as equity and included in additional paid in capital in the Company’s accompanying consolidated balance sheet for the prior years in accordance with ASC 718. Compensation - Stock Compensation . Accordingly, the Company’s accompanying consolidated balance sheets and consolidated statements of changes in equity as of December 31, 2022 and December 31, 2023, respectively, and for the three months ended March 31, 2023, June 30, 2023, and March 31, 2024, respectively, reflects an adjustment to include restricted stock compensation. On the balance sheet as of December 31, 2023, accounts payable and accrued liabilities reflects a reduction of $ 21,189 and additional paid-in capital reflects an increase of $ 21,189 . On the consolidated statements of changes in equity, the three months ended March 31, 2023, June 30, 2023 and September 30, 2023 reflect the addition of restricted stock compensation of $ 232,106 , $ 228,657 , and $ 270,564 , respectively, and the three months ended March 31, 2024 includes restricted stock compensation of $ 317,077 . The corrections did not affect Consolidated Statements of Operations or Consolidated Statements of Cash Flows in any prior periods. During the third quarter of 2024, management determined that the consolidated statements of cash flows for the nine months ended September 30, 2023 and the year ended December 31, 2023, overstated the amount of cash outflows for building and tenant improvements as a portion of those additions were in accounts payable at the end of each period. For the nine months ended September 30, 2023 and the year ended December 31, 2023, $ 850,918 and $ 295,567 , respectively, should have been disclosed as a supplemental disclosure of cash flow information as unpaid building and tenant improvements. Additionally, management has determined that debt financing costs for the year ended December 31, 2023 totaling $ 246,557 should be reclassified from accounts payable and accrued liabilities to payment of debt financing costs under cash flows from financing activities on the consolidated statement of cash flows. Thereby, increasing net cash provided by operating activities and reducing net cash provided by financing activities by $ 246,557 . The net effect of adjusting unpaid building and tenant improvements and debt financings costs amounts to a $ 49,010 decrease to operating cash flows for the year ended December 31, 2023. These errors impact the consolidated statement of cash flows and do not affect the consolidated balance sheets, consolidated statement of operations and consolidated statements of changes in equity. As such, the Company’s consolidated statement of cash flows for the nine months ended September 30, 2023, reflects an adjustment to reduce cash outflows for unpaid building and tenant improvements. For the nine months ended September 30, 2023, net cash provided by operating activities, as previously reported, of $ 488,137 was reduced by $ 850,918 and net cash provided by investing activities, as previously reported, of $ 128,168,785 was increased by $ 850,918 . Additionally, the $ 295,567 of unpaid building and tenant improvements that were recorded in accounts payable as of December 31, 2023, and paid in January 2024, are included in the statement of cash flows for the year ended December 31, 2024 . The effect of correcting the errors in operating and investing cash flows for unpaid building and tenant improvements for the three months ended March 31, 2024 was $ 48,207 and for the six months ended June 30, 2024 was $ 204,054 , which will be reflected in the Company’s interim financial statements the next time these periods are presented. During the fourth quarter of 2024, management determined that its prior treatment of including amortization of model home transactions fees in fees and other income should be reclassified to rental income on the consolidated statement of operations. For the years ended December 31, 2024 and 2023 the total fees reclassified amounted to $ 757,704 and $ 649,166 , respectively. There was no change to total revenues in either period. Reclassifications . Certain prior year balance sheet, statement of operations and statement of cash flows accounts have been reclassified to conform with the current year presentation. The reclassifications did not affect net income in the prior year's consolidated statement of operations. Warrant Instruments SPAC. Murphy Canyon accounted for warrants in accordance with the guidance contained in ASC 480 and FASB ASC 815, “Derivatives and Hedging”. Under ASC 815 - 40 and ASC 840 warrants that meet the criteria for equity treatment are recorded in stockholder’s equity. The warrants are subject to re-evaluation of the proper classification and accounting treatment at each reporting period. If the warrants no longer meet the criteria for equity treatment, they will be recorded as a liability and remeasured each period with changes recorded in the statements of operations. The warrants meet the criteria for classification as equity because they were not exercisable until after the SPAC business combination, which occurred on September 22, 2023, at which point the common shares are no longer redeemable and because they are indexed to Murphy Canyon's common stock and meet the other criteria for equity classification. See Note 9 Commitments and Contingencies for additional details regarding Murphy Canyon / Conduit. Subsequent Events. We evaluate subsequent events up until the date the consolidated financial statements are issued. See note 16 Subsequent Events. F- 18 Table of Contents Recently Issued and Adopted Accounting Pronouncements. In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023 - 09, Income Taxes , to enhance income tax disclosures, provide more information about tax risks and opportunities present in worldwide operations, and to disaggregate existing income tax disclosures. The guidance is effective for annual periods beginning after December 15, 2024 on a prospective basis, with the option to apply the standard retrospectively. Early adoption is permitted. We have adopted ASU 2023 - 09 and have updated our financial statement disclosures accordingly. In November 2023, FASB issued Accounting Standards Update ASU 2023 - 07, Segment Reporting , establishing improvements to reportable segments disclosures to enhance segment reporting under Topic 280. This ASU aims to change how public entities identify and aggregate operating segments and apply quantitative thresholds to determine their reportable segments. This ASU also requires public entities that operate as a single reportable segment to provide all segment disclosures in Topic 280, not just entity level disclosures. The guidance will be effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024 and the amendments should be applied retrospectively to all periods presented in the financial statements. We have adopted ASU 2023 - 07 and have updated our segment financial statement disclosures accordingly. In March 2024, the SEC issued final climate-disclosure rules to enhance and standardize climate‐related disclosures by public companies. With regards to financial statements, the rules requires disclosure of (i) capitalized costs, expenditures expensed, charges, and losses incurred as a result of severe weather events and other natural conditions, subject to applicable one percent and de minimis disclosure thresholds; (ii) capitalized costs, expenditures expensed, and losses related to carbon offsets and renewable energy credits or certificates (RECs) if used as a material component of a company's plans to achieve its disclosed climate-related targets or goals; and (iii) if the estimates and assumptions the company uses to produce the financial statements were materially impacted by risks and uncertainties associated with severe weather events and other natural conditions or any disclosed climate-related targets or transition plans, a qualitative description of how the development of such estimates and assumptions was impacted. The rules are effective for annual periods beginning January 1, 2025 and are to be applied prospectively. On April 4, 2024, the SEC voluntarily stayed the rules pending judicial review as a result of litigation. In November 2024, FASB issued Accounting Standards Update ASU 2024 - 03, Income Statement — Reporting Comprehensive, Income — Expense Disaggregation Disclosures, Disaggregation of Income Statement Expenses (“ASU 2024 - 03” ). This ASU is to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, SG&A, and research and development). The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. In January 2025, this was updated by ASU 2025 - 01—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220 - 40 ): Clarifying the Effective Date. The amendment in this Update amends the effective date of Update 2024 - 03 to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption of Update 2024 - 03 is permitted. We have not yet adopted ASU 2024 - 03 and are currently evaluating the impact on our financial statement disclosures. 3. RECENT REAL ESTATE TRANSACTIONS Significant Transactions in 2024 and 2023 Acquisitions during the year ended December 31, 2024: • We acquired 19 Model Home Properties and leased them back to the homebuilders under triple net leases during the year ended December 31, 2024 . The purchase price for these properties was $ 9.7 million. The purchase price consisted of cash payments of $ 3.0 million and mortgage notes of $ 6.7 million. Acquisitions during the year ended December 31, 2023: • We acquired 40 Model Home Properties and leased them back to the homebuilders under triple net leases during the year ended December 31, 2023 . The purchase price for the properties was $ 21.9 million. The purchase price consisted of cash payments of $ 6.6 million and mortgage notes of $ 15.3 million. We review our portfolio of investment properties for value appreciation potential on an ongoing basis, and dispose of any properties that no longer satisfy our requirements in this regard, taking into account tax and other considerations. The proceeds from any such property sale, after repayment of any associated mortgage or repayment of secured or unsecured indebtedness, are available for investing in properties that we believe will have a greater likelihood of future price appreciation. F- 19 Table of Contents Dispositions during the year ended December 31, 2024: During year ended December 31, 2024 , we disposed of the following properties: • 51 model homes for approximately $ 24.8 million and the Company recognized a gain of approximately $ 3.4 million. Dispositions during the year ended December 31, 2023: During year ended December 31, 2023 , we disposed of the following properties: • 22 model homes for approximately $ 11.7 million and the Company recognized a gain of approximately $ 3.2 million. 4. REAL ESTATE ASSETS The Company owns a diverse portfolio of real estate assets. The primary types of properties the Company invests in are office, industrial, retail, and triple-net leased model home properties. We have five commercial properties located in Colorado, four in North Dakota, one in Southern California, one in Texas and one in Maryland. Our model home properties are located in three states. As of December 31, 2024 , the Company owned or had an equity interest in: • Eight office buildings and one industrial building (“Office/Industrial Properties”); • Three retail shopping centers (“Retail Properties”); • 78 model home residential properties (“Model Homes” or “Model Home Properties”), leased back on a triple-net basis to homebuilders, which are owned by five affiliated limited partnerships and one wholly-owned corporation, all of which we control. During the third quarter of 2024, all of the model homes in Dubose Model Home Investors #202 and #206, LP had been sold. A summary of the properties owned by the Company, including their lease intangibles, as of December 31, 2024 and 2023 is as follows: Date Real estate assets and lease intangibles, net Property Name Acquired Location December 31, 2024 December 31, 2023 Genesis Plaza (1) August 2010 San Diego, CA $ 7,363,571 $ 7,542,725 Dakota Center (2) May 2011 Fargo, ND 8,154,951 9,201,883 Grand Pacific Center (3) March 2014 Bismarck, ND 8,413,926 8,274,454 Arapahoe Center December 2014 Centennial, CO 9,298,534 9,341,991 Union Town Center (4) December 2014 Colorado Springs, CO 8,922,943 8,918,742 West Fargo Industrial August 2015 Fargo, ND 6,599,953 6,819,765 300 N.P. August 2015 Fargo, ND 1,963,000 2,774,176 Research Parkway (4) August 2015 Colorado Springs, CO 2,220,284 2,266,173 One Park Center (5) August 2015 Westminster, CO 5,580,950 5,700,000 Shea Center II (6) December 2015 Highlands Ranch, CO 18,820,370 19,367,289 Mandolin (7) August 2021 Houston, TX 4,600,562 4,692,274 Baltimore December 2021 Baltimore, MD 8,241,456 8,466,165 Commercial properties 90,180,500 93,365,637 Model Home properties (8) 2019 - 2024 AZ, FL, TX 37,416,000 50,790,147 Total real estate assets and lease intangibles, net $ 127,596,500 $ 144,155,784 F- 20 Table of Contents ( 1 ) Genesis Plaza is owned by two tenants-in-common, NetREIT Genesis and NetREIT Genessis II, each of which own 57 % and 43 %, respectively, and we beneficially own an aggregate of 92.0 %, based on our ownership of each entity. We have 100 % ownership of NetREIT Genesis and 81.5 % ownership of NetREIT Genesis II, and we have control of both entities. During July 2024, the Company completed a minority ownership conversion option as result of a death in a noncontrolling trust within NetREIT Genesis II. The Company issued the trust 86,232 shares of SQFT Series A Common Stock in exchange for their 36.4 % ownership in NetREIT Genesis II, as per the original exchange agreement. ( 2 ) The non-recourse loan on the Dakota Center property matured on July 6, 2024. During October 2024, management has agreed with the lender to sell the property to settle the loan balance. Due to the uncertainties in the Fargo market, we have impaired the property’s book value and recorded an impairment charge of approximately $ 0.7 million as of September 30, 2024. During December 2024, the lender had agreed on the broker the Company would use to sell the property to settle the non-recourse debt. As of December 31, 2024 , the property was included in the real estate assets held for sale, net on the consolidated balance sheet. Any purchase offers will be subject to lender approval. ( 3 ) Grand Pacific Center, Bismarck, ND, was removed from held-for-sale after signing a major lease with KLJ Engineering on December 7, 2022 for approximately 33,296 usable square feet, a term of 122 months, and starting annualized rent of $ 532,736 . KLJ Engineering moved into the building during December 2023, with rent that commenced on February 28, 2024. ( 4 ) As of September 30, 2024, Union Town Center and Research Parkway were listed for sale, and included in the real estate assets held for sale, net on the consolidated balance sheet as of December 31, 2024 . The sale of UTC and Research Parkway took place in February 2025, to a single buyer for a combined sales price of $ 16.95 million, and the Company recorded a combined gain of approximately $ 4.0 million. ( 5 ) During the year ended December 31, 2023, we recorded a $ 2.0 million impairment charge for One Park Center that reflects management’s revised estimate of the fair market value based on sales comparable of like properties in the same geographical area as well as an evaluation of future cash flows or an executed purchase sale agreement. No additional impairment was deemed necessary during the year ended December 31, 2024 . ( 6 ) On December 31, 2022, the lease for our largest tenant, Halliburton, expired. Halliburton was located in our Shea Center II property in Colorado, and made up approximately $ 536,080 of our annual base rent. Halliburton did not renew the lease and we placed approximately $ 1.1 million in a reserve account with our lender to cover future mortgage payments, if necessary, none of which has been used as of December 31, 2024. ( 7 ) A portion of the proceeds from the sale of Highland Court were used in like-kind exchange transactions pursued under Section 1031 of the Code for the acquisition of our Mandolin property. Mandolin is owned by NetREIT Palm Self-Storage LP, through its wholly owned subsidiary NetREIT Highland LLC, and the Company is the sole general partner and owns 61.3 % of NetREIT Palm Self-Storage LP. ( 8 ) Includes Model Homes listed as held for sale as of December 31, 2024 . During the year ended December 31, 2024 , we recorded an impairment charge for model homes totaling $ 0.4 million, which reflects the estimated sales prices for these specific model homes. The short hold period, less than two years, and the builder changing their model style after we purchased the homes, contributed to the lower than expected sales price. For the years ended December 31, 2024 and 2023 , depreciation and amortization expense, excluding amortization of deferred leasing cost, totaled approximately $ 5.0 million and $ 4.9 million, respectively. F- 21 Table of Contents 5. LEASE INTANGIBLES The following table summarizes the net value of other intangible assets acquired and the accumulated amortization for each class of intangible asset: December 31, 2024 December 31, 2023 Lease Intangibles Accumulated Amortization Lease Intangibles, net Lease Intangibles Accumulated Amortization Lease Intangibles, net In-place leases $ 2,515,264 $ ( 2,504,799 ) $ 10,465 $ 2,515,264 $ ( 2,495,016 ) $ 20,248 Leasing costs 1,261,390 ( 1,252,078 ) 9,312 1,261,390 ( 1,244,335 ) 17,055 Above-market leases — — — 333,485 ( 333,485 ) — $ 3,776,654 $ ( 3,756,877 ) $ 19,777 $ 4,110,139 $ ( 4,072,836 ) $ 37,303 At December 31, 2024 and 2023 , there were no net lease intangible assets and accumulated amortization related to the lease intangible assets included in real estate assets held for sale. The net value of acquired intangible liabilities was approximately $ 8,625 and $ 13,266 relating to below-market leases at December 31, 2024 and December 31, 2023 , respectively. Amortization of below-market rent totaled approximately $ 4,641 and $ 4,974 for the years ended December 31, 2024 and 2023 . Future aggregate approximate amortization expense for the Company's lease intangible assets is as follows: 2025 15,670 2026 4,107 Thereafter — Total $ 19,777 6. OTHER ASSETS Other assets consist of the following: December 31, December 31, 2024 2023 Deferred rent receivable $ 2,126,609 $ 1,973,887 Accounts receivable, net 463,194 694,869 Prepaid expenses, deposits and other 406,494 349,160 Notes receivable 316,374 316,374 Right-of-use assets, net 64,026 15,649 Deferred offering costs — 5,000 Investment in marketable securities (not including Conduit) — 45,149 Total other assets $ 3,376,697 $ 3,400,088 F- 22 Table of Contents Periodically, the Company may sell an option in the marketable securities it holds to unrelated third parties for the right to purchase certain securities held within its investment portfolios (“covered call options”). These option transactions are designed primarily to increase the total return associated with holding the related securities as earning assets by using fee income generated from these options. These transactions are not designated as hedging relationships pursuant to accounting guidance ASC 815 and, accordingly, changes in fair values of these contracts are reported in other income (expense). There are several risks associated with transactions in options on securities. For example, there are significant differences between the securities and options markets that could result in an imperfect correlation between these markets, causing a given transaction not to achieve its objectives. A transaction in options or securities may be unsuccessful to some degree because of market behavior or unexpected events. When we write a covered call option, we forgo, during the option’s life, the opportunity to profit from increases in the market value of the security covering the call option above the sum of the premium and the strike price of the call, but retain the risk of loss should the price of the underlying security decline. The writer of an option has no control over the time when it may be required to fulfill its obligation before the sold option expires, and once an option writer has received an exercise notice, it must deliver the underlying security in exchange for the strike price. As of December 31, 2024 , we did not own common shares of any publicly traded REITs and no written covered call options in any of those same REITs. As of December 31, 2023 , we owned common shares and options of 3 different publicly traded REITs and an immaterial amount of covered call options in zero of those same REITs. The gross fair market value on our publicly traded REIT securities was $ 45,149 , with covered call options totaling $ 0 . As of December 31, 2023 , the net fair value of our publicly traded REIT securities was $ 45,149 based on the December 31, 2023 closing prices. 7. MORTGAGE NOTES PAYABLE Mortgage notes payable consist of the following: Principal as of December 31, December 31, Loan Interest Mortgage note property 2024 2023 Type Rate (1) Maturity Dakota Center (2) 9,091,395 $ 9,197,346 Fixed 4.74 % 7/6/2024 Research Parkway (6) 1,526,860 1,588,742 Fixed 3.94 % 1/5/2025 Arapahoe Service Center 8,670,000 7,426,088 Fixed 6.75 % 12/5/2029 Union Town Center (6) 7,709,746 7,870,468 Fixed 4.28 % 1/5/2025 One Park Centre (6) 5,919,517 6,043,882 Fixed 4.77 % 9/5/2025 Genesis Plaza (6) 5,813,843 5,937,251 Fixed 4.71 % 9/6/2025 Shea Center II 16,660,803 16,951,095 Fixed 4.92 % 1/5/2026 West Fargo Industrial (3) 5,750,000 3,922,829 Fixed 7.14 % 7/6/2029 Grand Pacific Center (4) 6,460,405 5,470,305 Fixed 6.35 % 5/10/2033 Baltimore 5,670,000 5,670,000 Fixed 4.67 % 4/6/2032 Mandolin 3,508,702 3,573,201 Fixed 4.35 % 4/20/2029 Subtotal, Presidio Property Trust, Inc. Properties $ 76,781,271 $ 73,651,207 Model Home mortgage notes (5) 26,060,798 34,815,699 Fixed 5.34 % - 8.00 % 2025 - 2029 Mortgage Notes Payable $ 102,842,069 $ 108,466,906 Unamortized loan costs ( 747,975 ) ( 753,633 ) Mortgage Notes Payable, net $ 102,094,094 $ 107,713,273 F- 23 Table of Contents ( 1 ) Interest rates as of December 31, 2024 . ( 2 ) The non-recourse loan on the Dakota Center property matured on July 6, 2024. Management has been in negotiations with the lender and their special servicer of the loan in modifying and/or extending the loan or possibly selling the building. We have not been able to come to an agreement regarding a situation in which the loan is modified or extended. As such, in October 2024, we have offered the property for sale in conjunction with the lender’s approval in attempts to make the lender whole, although there is no guarantee we will be able to do so. The loan is considered non-recourse and we will not be required to make up the difference if the property sells for less than the loan balance. See Note 4. Real Estate Assets above for further discussion on impairment of the property. ( 3 ) On June 20, 2024, the Company, through its subsidiary, refinanced the mortgage loan on our West Fargo Industrial properties, and entered into a loan agreement for approximately $ 5.75 million, a term of five years, with an interest rate of 7.14 %. The loan agreement has a Debt Service Coverage Ratio ("DSCR") minimum of 1.20 to 1.00 as calculated by Lender, in which: (a) the numerator is the Underwritten Net Cash Flow, and (b) the denominator is the annual Debt Service, tested at the end of each fiscal quarter. ( 4 ) On May 5, 2023, the Company, through its subsidiary, refinanced the mortgage loan on our Grand Pacific Center property and entered into a construction loan related to the tenant improvement associated with the KLJ Engineering LLC lease to occupy 33,296 square feet of the building. The refinanced loan is for approximately $ 3.8 million, a term of 10 years, with an interest rate of 6.35 %, for the first 60 months. The interest rate is subject to reset in year five on June 10, 2028. The construction loan is for approximately $ 2.7 million, a term of 10 years, and will begin amortizing in year three, with an interest rate of 6.35 %, for the first 60 months. The interest rate is subject to reset in year five on June 10, 2028. During the third quarter of 2024, we had fully drawn down the loan amount of approximately $ 2.7 million on the construction loan. ( 5 ) As of December 31, 2024 , there were 9 model homes included as real estate assets held for sale. Our model homes have stand-alone mortgage notes at interest rates ranging from 5.37 % to 8.0 % per annum as of December 31, 2024 . ( 6 ) These mortgage loans mature within the next twelve months and management is reviewing various options for the loan maturity, including but not limited to refinancing, restructuring and or selling these properties. As we get closer to the loan maturity date, the Company will finalize our plans. Union Town Center and Research Parkway have been listed for sale, and included in the real estate assets held for sale, net on the consolidated balance sheet as of December 31, 2024 . These properties were sold to a single buy in February 2025 and their loans were paid in full. The loan agreement between NetREIT Model, Homes, Inc. (“NRMH”) and their Lender has a covenant for a Fixed Charge Coverage Ratio, (“FCCR”) as defined for NRMH as of any date (a) the sum of (i) EBITDA for the period ended as of such date minus (ii) Distributions for the period ended as of such date divided by (b) the sum of (ii) Principal Payments Paid for the period ended as of such date plus (iii) Interest Expense for period ended as of such date. The FCCR is to be no less than 1.10 to 1.00, tested at the end of each fiscal quarter. As of December 31, 2024 , NRMH was in compliance with this covenant. The Company and stand along subsidiaries have other various quarterly and annual reporting requirements to the individual property lenders and is in compliance with all material conditions and covenants on those mortgage notes payable as of December 31, 2024 . Scheduled principal payments of mortgage notes payable were as follows as of December 31, 2024 : F- 24 Table of Contents Commercial Model Properties Homes Total Principal Years ending December 31: Notes Payable Notes Payable Payments 2025 $ 30,494,515 $ 8,283,913 $ 38,778,428 2026 16,654,441 1,668,193 18,322,634 2027 302,885 495,924 798,809 2028 322,652 9,575,775 9,898,427 2029 17,291,085 6,036,993 23,328,078 Thereafter 11,715,693 — 11,715,693 Total $ 76,781,271 $ 26,060,798 $ 102,842,069 8. NOTES PAYABLE On April 22, 2020, the Company received an Economic Injury Disaster Loan of $ 10,000 from the Small Business Administration ("SBA") to provide economic relief during the COVID- 19 pandemic. This loan advance is not required to be repaid, has no stipulations on use, and has been recorded as fees and other income in the consolidated statements of operations during fiscal 2020. On August 17, 2020, we received an additional Economic Injury Disaster Loan ("EIDL") of $ 150,000 , for which principal and interest payments are deferred for twelve months from the date of issuance, and interest accrues at 3.75% per year. The loan matures on August 17, 2050. We have used the funds for general corporate purposes to alleviate economic injury caused by the COVID- 19 pandemic, which economic injury included abating or deferring rent to certain tenants (primarily retail tenants). As of December 31, 2024 and 2023 , the principal balance on SBA loan was approximately $ 144,089 and $ 147,428 , respectively. During 2023, we had issued one promissory note to our majority owned subsidiary, Dubose Model Home Investors 202 LP, for the refinancing of one model home property in Texas, for approximately $ 0.3 million with an interest rate of 5.55 % per annum and original maturity date of August 15, 2024, which was extended for another year with an interest rate of 8.0 % per annum. This note payable and note receivable, including interest expense and interest income related to this promissory note, is eliminated through consolidation on our financial statements. This property was subsequently sold in October 2024, and the loan was paid in full. As of December 31, 2024 , there were no other notes payable. F- 25 Table of Contents 9 . INVESTMENT IN CONDUIT PHARMACEUTICALS Sponsorship of Special Purpose Acquisition Company. On January 7, 2022, we announced our sponsorship, through our wholly-owned subsidiary, Murphy Canyon Acquisition Sponsor, LLC (the "Sponsor"), of a special purpose acquisition company ("SPAC") initial public offering. The SPAC raised $ 132,250,000 in capital investment to acquire one or more businesses. We, through our wholly-owned subsidiary, owned approximately 23.5 % of the issued and outstanding stock in the entity upon the initial public offering being declared effective and consummated (excluding the private placement units described below). The SPAC offered 132,250,000 units, with each unit consisting of one share of common stock and three -quarters of one redeemable warrant. The warrants were evaluated using the guidance in ASC 480 "Distinguishing Liabilities from Equity" and we concluded that the warrants are indexed to Murphy Canyon's common stock and meet the criteria to be classified in stockholders' equity. The Murphy Canyon IPO of 13,225,000 units of common stock and warrants, closed on February 7, 2022, raising gross proceeds for Murphy Canyon of $ 132,250,000 , including the exercise in full by the underwriters of their over-allotment option. In connection with the IPO, we purchased, through the Sponsor, 754,000 placement units (the "placement units") at a price of $ 10.00 per unit, for an aggregate purchase price of $ 7,540,000 . These proceeds were deposited in a trust account established for the benefit of the Murphy Canyon public shareholders and are included in Investments held in Trust. In connection with the initial public offering, Murphy Canyon incurred $ 7,738,161 in issuance costs, including $ 2,645,000 of underwriting discounts and commission, $ 4,628,750 of deferred underwriting fees and $ 464,411 of other offering costs. These costs were allocated to temporary and permanent equity and offset against the proceeds. On November 8, 2022, the SPAC entered into an agreement and plan of merger with Conduit Pharmaceuticals Limited, a Cayman Islands exempted company ("Conduit Pharma"), and Conduit Merger Sub, Inc., a Cayman Islands exempted company and the SPAC's wholly owned subsidiary. The merger agreement provided that the SPAC's Cayman Island subsidiary will merge with and into Conduit Pharma, with Conduit Pharma surviving the merger as the SPAC's wholly owned subsidiary and the public company renamed "Conduit Pharmaceuticals Inc." ("Conduit"). Initially, the SPAC was required to complete its initial business combination transaction by 12 months from the consummation of its initial public offering or up to 18 months if it extended the period of time to consummate a business combination in accordance with its Certificate of Incorporation. On January 26, 2023, at a special meeting of the stockholders, the stockholders approved a proposal to amend the SPAC's certificate of incorporation to extend the date by which it has to consummate a business combination up to 12 times, each such extension for an additional one -month period, from February 7, 2023 to February 7, 2024. The stockholders also approved a related proposal to amend the trust agreement allowing the SPAC to deposit into the trust account, for each one -month extension, one - third of 1% of the funds remaining in the trust account following the redemptions made in connection with the approval of the extension proposal at the special meeting. The Company has committed to providing additional funds if needed to make such a deposit for the extension. In connection with the stockholders' vote at the special meeting, 11,037,272 shares of common stock were tendered for redemption, which were redeemed in February 2023. Approximately $ 114.1 million in cash was removed from the Trust Account to pay such stockholders and, accordingly, after giving effect to such redemptions, income tax withdraws of $ 200,050 and adding $ 155,403 in extension payments, the balance in the Trust Account was approximately $ 23.3 million. After the redemptions, there were 2,187,728 shares of SPAC Class A common stock subject to possible redemption. On January 27, 2023, the merger agreement was amended to provide for only one class of authorized common stock of the SPAC following the business combination, instead of both authorized Class A common stock and Class B common stock as set forth in the original merger agreement. On May 11, 2023, the merger agreement was further amended to provide for (i) removal of the provision that indicates that no tax opinion would be delivered in connection with the closing, (ii) a closing obligation that that the SPAC either (a) be exempt from the provisions of Rule 419 promulgated under the Securities Act of 1933, as amended, other than through its net tangible assets or (b) have at least $ 5,000,001 of net tangible assets either immediately prior to or upon consummation of the merger, and (iii) extension of the outside date for the closing of the merger from May 31, 2023 to February 7, 2024. The investments held in Trust for the SPAC Class A common stockholders generated approximately $ 1.2 million of income during the nine months ended September 30, 2023, and was included in interest and other income (expense), net on our consolidated statement of operations. As of September 22, 2023, the Trust account balance had been deconsolidated along with the other Conduit assets and liabilities. F- 26 Table of Contents As of immediately prior to the consummation of the SPAC's business combination, which occurred on September 22, 2023, the Company, through its subsidiary, had loaned the SPAC $ 1.0 million to fund its trust account and for operating expenses. The loan was non-interest bearing, unsecured and was repaid in full upon the SPAC's business combination on September 22, 2023. The notes payable and notes receivable related to the SPAC were eliminated through consolidation on our financial statements. On September 22, 2023, the SPAC completed its business combination with Conduit Pharma and changed its name to Conduit Pharmaceuticals Inc. ("Conduit"). Immediately prior to the business combination, the Company owned approximately 65 % of the SPAC's outstanding common stock. Upon consummation of the business combination, the SPAC's shares of Class B common stock were converted into shares of its Class A common stock and the shares of Class A common stock were then reclassified as a single class of Conduit common stock. As a result of the business combination, the Company was issued (i) 3,306,250 shares of Conduit's common stock due to the conversion of the shares of the SPAC's Class B common stock into shares of the SPAC's Class A common stock and then reclassification into shares of Conduit common stock, (ii) 754,000 shares of Conduit common stock, which prior to the business combination were shares of the SPAC's Class A common stock and (iii) private warrants to purchase 754,000 shares of Conduit common stock, which prior to the business combination were warrants to purchase 754,000 shares of the SPAC's Class A common stock. Also in the business combination, shareholders and debtholders of Conduit Pharma were issued 65,000,000 shares of Conduit common stock. Immediately following the consummation of the business combination, the Company transferred 45,000 shares of Conduit common stock and warrants to purchase 45,000 shares of Conduit common stock to the SPAC's independent directors as compensation for their services. As a result, the Company owned approximately 6.5 % of Conduit's common stock immediately following the business combination, assuming all warrants owned by the Company were exercised and as of September 30, 2024, we currently own less than 1 % of Conduit's common stock, assuming all warrants owned by the Company are exercised. In connection with the business combination, the Company's officers and directors who also served as officers and directors of the SPAC resigned from the SPAC, with the exception of the Company's former Chief Financial Officer who resigned from the Company. Following the completion of the Murphy Canyon IPO in February 2022, we determined that Murphy Canyon is a Variable Interest Entity ("VIE") in which we had a variable interest because Murphy Canyon did not have enough equity at risk to finance its activities without additional subordinated financial support. Since the business combinations with Conduit on September 22, 2023, we have determined that Conduit's (formally Murphy Canyon) public stockholders have substantive rights and we no longer have control of Conduit's activity. Since we are no longer the controlling party, or have a majority of the issued and outstating common stock, the Company deconsolidated Conduit from our consolidated financial statements. In connection with the deconsolidation, we recorded a gain of approximately $ 40.3 million. Of the total gain recognized on deconsolidation, approximately $ 34.1 million relates to the remeasurement of our retained investment in Murphy Canyon via the Sponsor shares which converted into shares of Conduit's common stock on September 22, 2023, and approximately $ 6.2 million relates to the deconsolidation of Murphy Canyon's assets and liabilities as of September 22, 2023. On April 22, 2024, the Company entered into a lockup agreement with Conduit pursuant to which the Company agreed not to transfer or sell 2,700,000 of its 4,015,250 shares of Conduit common stock for a period of one year. In consideration for entering into the lockup agreement, Conduit issued the Company Private CDT Warrants to purchase 540,000 shares of common stock at an exercise price of $ 3.12 per share, a two year term and exercisable one year after the date of issue. The Private CDT Warrants meet the ASC 321 scope exception for derivative instruments and are accounted for as a derivative under ASC 815. As such, the Private CDT Warrants were recorded at fair value on the date of issuance and subsequently measured at fair value each period, with changes in fair value reported in gain or loss on Conduit Pharmaceuticals marketable securities. As of April 22, 2024, the Private CDT Warrants were valued at $ 891,000 based on a Level 3 fair value measurement. As of December 31, 2024 , the Private CDT Warrants fair value was adjusted to zero , which is included in the total Investment in Conduit Pharmaceuticals marketable securities on the December 31, 2024 consolidated balance sheet. Our investments in Conduit's common stock ( 2,944,514 shares of CDT) and public common stock warrants ( 709,000 warrants of CDTTW) presented on the consolidated balance sheets were measured at fair value using Level 1 market prices, taking into account the adoption of ASU 2022 - 03 Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, and totaled approximately $ 0.2 million as of December 31, 2024 . The combined value of our Investment in Conduit Pharmaceuticals marketable securities, including the Private CDT Warrants, totaled $ 0.2 million as of December 31, 2024 , resulting in a net loss on investment for the year ended December 31, 2024 totaling approximal $ 17.9 million. During the year ended December 31, 2023 , and in connection with the deconsolidation we recorded a gain of approximately $ 40.3 million. Of the total gain recognized on deconsolidation, approximately $ 34.1 million relates to the remeasurement of our retained investment in Murphy Canyon via the Sponsor shares which converted into shares of Conduit's common stock on September 22, 2023, and approximately $ 6.2 million relates to the deconsolidation of Murphy Canyon's assets and liabilities as of September 22, 2023. Since deconsolidating Conduit, on September 22, 2023, our investments in Conduit's common stock and common stock warrants presented on the consolidated balance sheets were measured at fair value totaled approximately $ 18.3 million as of December 31, 2023 , with a cost basis of approximately $ 7.5 million. This resulted in net loss on investment for the year ended December 31, 2023 totaling approximal $ 23.4 million. F- 27 Table of Contents During October 2024, the Company paid part of an accrued bonus to the former CFO with shares of CDT common stock. The total number of CDT common stock shares transferred to our former CFO was 1,045,805 shares at $ 0.1087 per share with a fair market value of $ 113,679 at the time of transfer. After the transfer the Company still owned 2,944,514 shares of CDT common stock, 709,000 CDTTW warrants and 540,000 private warrants. Since December 31, 2024, CDT has affected a 1 -for- 100 reverse stock split of the CDT common stock, resulting in our 2,944,514 shares being converted into 29,445 shares. 10 . COMMITMENTS AND CONTINGENCIES The Company is obligated under certain tenant leases to fund tenant improvements and the expansion of the underlying leased properties. As of December 31, 2024 , approximately $ 1.2 million is estimated for such capital expenditures on existing properties, net of any construction financing, during the rest of the year. Activist stockholder activities could adversely affect our business because responding to proxy contests and reacting to other actions by activist stockholders can be costly and time-consuming, disrupt our operations and divert the attention of management and our employees. We have or in the future may retain the services of various professionals to advise us on activist stockholder matters, including legal, financial, strategic and communication advisors, the costs of which may negatively impact our future financial results. In addition, perceived uncertainties as to our future direction, strategy or leadership created as a consequence of activist stockholders' initiatives may result in the loss of potential business opportunities, harm our ability to attract new investors, business partners, and employees, and cause our stock price to experience periods of volatility or stagnation. On March 13, 2024, a stockholder activist group announced its intention to file a preliminary proxy statement and accompanying WHITE universal proxy card with the Securities and Exchange Commission to be used to solicit votes for the election of director nominees at our next annual meeting of stockholders. On May 9, 2024, the Company entered into a cooperation agreement with this stockholder group pursuant to which Elena Piliptchak was appointed to our board of directors, effective immediately, as a Class III director with a term expiring at Presidio's 2026 Annual Meeting of Stockholders. In connection with this appointment, our board of directors has been increased from six to seven directors. Pursuant to the agreement, the stockholder group agreed to withdraw the director nominations it had previously submitted and support our board's slate of directors at the 2024 Annual Meeting of Stockholders, which was held on June 27, 2024. The stockholder group has also agreed to certain customary standstill provisions and voting commitments. We have evaluated this contingency and have determined a material loss is not probable or estimable at this time. Litigation. From time to time, we may become involved in various lawsuits or legal proceedings which arise in the ordinary course of business. Neither the Company nor any of the Company's properties are presently subject to any material litigation nor, to the Company's knowledge, is there any material threatened litigation. Environmental matters. The Company monitors its properties for the presence of hazardous or toxic substances. While there can be no assurance that a material environmental liability does not exist, the Company is not currently aware of any environmental liability with respect to the properties that would have a material effect on the Company's financial condition, results of operations and cash flow. Further, the Company is not aware of any environmental liability or any unasserted claim or assessment with respect to an environmental liability that the Company believes would require additional disclosure or recording of a loss contingency. Financial Markets. The Company monitors concerns over economic recession, interest rate increases, policy priorities of the U.S. presidential administration, trade wars, labor shortages, and inflation, any of which may contribute to increased volatility and diminished expectations for the economy and markets. Additionally, the economic and geopolitical ramifications of the military conflicts in the Middle East and Ukraine, including sanctions, retaliatory sanctions, nationalism, supply chain disruptions and other consequences, could impact commercial real estate fundamentals and result in lower occupancy, lower rental rates, and declining values in our real estate portfolio and in the collateral securing our loan investments. We have not currently experienced a direct material impact to our Company or operations; however, we will continue to monitor the financial markets for events that could impact our commercial real estate properties. 11. STOCKHOLDERS’ EQUITY Preferred Stock. The Company is authorized to issue up to 1,000,000 shares of Preferred Stock (the “Preferred Stock”). The Preferred Stock may be issued from time to time in one or more series. The Board of Directors is authorized to fix the number of shares of any series of the Preferred Stock, to determine the designation of any such series, and to set the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption for each series of Preferred Stock. F- 28 Table of Contents On June 15, 2021, the Company completed its secondary offering of 800,000 shares of our Series D Preferred Stock for cash consideration of $ 25.00 per share to a syndicate of underwriters led by The Benchmark Company, LLC, as representative, resulting in approximately $ 18.1 million in net proceeds, after deducting the underwriting discounts and commissions and the offering expenses paid by the Company. The Company granted the underwriters a 45 -day option to purchase up to an additional 120,000 shares of Series D Preferred Stock to cover over-allotments, which they exercised on June 17, 2021, resulting in approximately $ 2.7 million in net proceeds, after deducting the underwriting discounts and commissions and the offering expenses paid by the Company. In total, the Company issued 920,000 shares of Series D Preferred Stock with net proceeds of approximately $ 20.5 million, after deducting the underwriting discounts and commissions and the offering expenses paid by the Company and deferred offering costs. The Series D Preferred Stock is listed for trading on The Nasdaq Capital Market under the symbol SQFTP. The Company has used these proceeds for general corporate and working capital purposes, including acquiring additional properties. Below are some of the key terms of the Series D Preferred Stock: On June 20, 2024, the Company entered into an underwriting agreement with The Benchmark Company, LLC, pursuant to which the Company issued and sold in an underwritten public offering 109,054 shares of the Company’s Series D Preferred Stock. The shares of Series D Preferred Stock were sold to the public at a price of $ 16.00 per share. The Company agreed to an underwriting discount of 7 % of the public offering price of the shares of Series D Preferred Stock sold in the offering. The offering closed on June 24, 2024, generating gross proceeds of approximately $ 1.74 million, before deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. The Company intends to use the net proceeds from the offering for general corporate and working capital purposes, including to potentially acquire additional properties. Below are some of the key terms of the Series D Preferred Stock: Dividends: Holders of shares of the Series D Preferred Stock are entitled to receive cumulative cash dividends at a rate of 9.375 % per annum of the $ 25.00 per share liquidation preference (equivalent to $ 2.34375 per annum per share). Dividends will be payable monthly on the 15th day of each month (each, a “Dividend Payment Date”), provided that if any Dividend Payment Date is not a business day, then the dividend that would otherwise have been payable on that Dividend Payment Date may be paid on the next succeeding business day without adjustment in the amount of the dividend. Voting Rights: Holders of shares of the Series D Preferred Stock will generally have no voting rights. However, if the Company does not pay dividends on the Series D Preferred Stock for eighteen or more monthly dividend periods (whether or not consecutive), the holders of the Series D Preferred Stock (voting separately as a class with the holders of all other classes or series of the Company’s preferred stock it may issue upon which like voting rights have been conferred and are exercisable and which are entitled to vote as a class with the Series D Preferred Stock in the election referred to below) will be entitled to vote for the election of two additional directors to serve on the Company’s Board of Directors until the Company pays, or declares and sets apart funds for the payment of, all dividends that it owes on the Series D Preferred Stock, subject to certain limitations. In addition, the affirmative vote of the holders of at least two -thirds of the outstanding shares of Series D Preferred Stock (voting together as a class with all other series of parity preferred stock the Company may issue upon which like voting rights have been conferred and are exercisable) is required at any time for the Company to (i) authorize or issue any class or series of its stock ranking senior to the Series D Preferred Stock with respect to the payment of dividends or the distribution of assets on liquidation, dissolution or winding up or (ii) to amend any provision of the Company charter so as to materially and adversely affect any rights of the Series D Preferred Stock or to take certain other actions. Liquidation Preference : In the event of the Company’s voluntary or involuntary liquidation, dissolution or winding up, the holders of shares of Series D Preferred Stock will be entitled to be paid out of the assets the Company has legally available for distribution to its stockholders, subject to the preferential rights of the holders of any class or series of its stock the Company may issue ranking senior to the Series D Preferred Stock with respect to the distribution of assets upon liquidation, dissolution or winding up, a liquidation preference of $25.00 per share, plus any accumulated and unpaid dividends to, but not including, the date of payment, before any distribution of assets is made to holders of the Company’s common stock or any other class or series of the Company’s stock it may issue that ranks junior to the Series D Preferred Stock as to liquidation rights. F- 29 Table of Contents In the event that, upon any such voluntary or involuntary liquidation, dissolution or winding up, the Company’s available assets are insufficient to pay the amount of the liquidating distributions on all outstanding shares of Series D Preferred Stock and the corresponding amounts payable on all shares of other classes or series of the Company’s stock that it issues ranking on parity with the Series D Preferred Stock in the distribution of assets, then the holders of the Series D Preferred Stock and all other such classes or series of stock shall share ratably in any such distribution of assets in proportion to the full liquidating distributions to which they would otherwise be respectively entitled. Redemption: Commencing on or after June 15, 2026, the Company may redeem, at its option, the Series D Preferred Stock, in whole or in part, at a cash redemption price equal to $ 25.00 per share, plus any accumulated and unpaid dividends to, but not including the redemption date. Prior to June 15, 2026, upon a Change of Control (as defined in the Articles Supplementary), the Company may redeem, at its option, the Series D Preferred Stock, in whole or part, at a cash redemption price of $25.00 per share, plus any accumulated and unpaid dividends to, but not including the redemption date. The Series D Preferred Stock has no stated maturity, will not be subject to any sinking fund or other mandatory redemption, and will not be convertible into or exchangeable for any of our other securities. In accordance with the terms of the Series D Preferred Stock, the Series D monthly dividend has been approved by the Board of Directors through December 31, 2024 in the amount of $ 0.19531 per share payable on the 15th of every month to stockholders of record of Series D Preferred Stock as of the last day of the prior month. Total dividends paid to Series D Preferred stockholders during the year ended December 31, 2024 and 2023 were approximately $ 2.2 million and $ 2.1 million, respectively. Common Stock. The Company is authorized to issue up to 100,000,000 shares of Series A Common Stock, 1,000 shares of Series B Common Stock, and 9,000,000 shares of Series C Common Stock (collectively, the "Common Stock") each with $ 0.01 par value per share. Each class of Common Stock has identical rights, preferences, terms, and conditions except that the holders of Series B Common Stock are not entitled to receive any portion of Company assets in the event of the Company's liquidation. No shares of Series B or Series C Common Stock have been issued. Each share of Common Stock entitles the holder to one vote. Shares of our Common Stock are not subject to redemption and do not have any preference, conversion, exchange, or preemptive rights. The Company's charter contains restrictions on the ownership and transfer of the Common Stock that prevents one person from owning more than 9.8 % of the outstanding shares of common stock. The Board of Directors approved our CEO, Jack Heilbron, and CIO, Gary Katz, an exception to the 9.8 % ownership limit and established an excepted holder limit permitting each of Jack Heilbron and Gary Katz to beneficially or constructively own up to 19 % of the outstanding shares of our common stock, including warrants, subject to compliance with Article VII of the Company’s charter. On July 12, 2021, the Company entered into a securities purchase agreement with a single U.S. institutional investor for the purchase and sale of 1,000,000 shares of its Series A Common Stock, Common Stock Warrants to purchase up to 2,000,000 shares of Series A Common Stock and Pre-Funded Warrants to purchase up to 1,000,000 shares of Series A Common Stock. Each share of Common Stock and accompanying Common Stock Warrants were sold together at a combined offering price of $ 5.00 , and each share of Common Stock and accompanying Pre-Funded Warrants were sold together at a combined offering price of $ 4.99 . The Pre-Funded Warrants were exercised in full during August 2021 at a nominal exercise price of $ 0.01 per share. The Common Stock Warrants have an exercise price of $ 5.50 per share, were exercisable upon issuance and will expire five years from the date of issuance. In connection with this additional offering, we agreed to issue the Placement Agent Warrants to purchase up to 80,000 shares of Series A Common Stock, representing 4.0 % of the Series A Common Stock and shares of Series A Common Stock issuable upon exercise of the Pre-Funded Warrant. The Placement Agent Warrants were issued in August 2021, post exercise of the Pre-Funded Warrants with an exercise price of $ 6.25 and will expire five years from the date of issuance. The Company evaluated the accounting guidance in ASC 480 and ASC 815 regarding the classification of the Pre-Funded Warrant, Common Stock Warrants, and Placement Agent Warrants as equity or a liability and ultimately determined that it should be classified as permanent equity. As of December 31, 2024 , none of the Common Stock Warrants and Placement Agent Warrants have been exercised. Genesis Plaza is owned by two tenants-in-common, NetREIT Genesis and NetREIT Genessis II, each of which own 57 % and 43 %, respectively, and we beneficially own an aggregate of 92.0 %, based on our ownership of each entity. We have 100 % ownership of NetREIT Genesis and 81.5 % ownership of NetREIT Genesis II, and we have control of both entities. During July, 2024, the Company completed a minority ownership conversion option as result of a death in a noncontrolling trust within NetREIT Genesis II. The Company issued the trust 86,232 shares of SQFT Series A Common Stock in exchange for their 36.4 % ownership in NetREIT Genesis II, as per the original exchange agreement at $ 9.30 per share. F- 30 Table of Contents Stock Repurchase Program . While we will continue to pursue value creating investments, the Board of Directors believes there is significant embedded value in our assets that is yet to be realized by the market. Therefore, returning capital to stockholders through a repurchase program is an attractive use of capital currently. On September 15, 2022, the Board of Directors authorized a stock repurchase program of up to $ 6.0 million of outstanding shares of our Series A Common Stock and up to $ 4.0 million of our Series D Preferred Stock, which expired in September 2023. In November 2023, the Board of Directors authorized a stock repurchase program of up to $ 6.0 million of outstanding shares of our Series A Common Stock and up to $ 4.0 million of our Series D Preferred Stock which expired in November 2024. During the year ended December 31, 2023, the Company repurchased 23,041 shares of our Series D Preferred Stock at an average price of approximately $ 16.06 per share, including a commission of $ 0.035 per share, and no shares of our Series A Common Stock, for a total cost of $ 0.4 million for the Series D Preferred Stock. In December 2024, the Board of Directors authorized a stock repurchase program of up to $ 6.0 million of outstanding shares of our Series A Common Stock and up to $ 4.0 million of our Series D Preferred Stock, which shall expire in December 2025. During the year ended December 31, 2024 , we repurchased 190,640 shares of our Series A Common Stock, for a total cost of $ 140,416 , with an average price of approximately $ 1.10 per share, including a commission of $ 0.025 per share. During the year ended December 31, 2024 , the Company repurchased 2,918 shares of our Series D Preferred Stock at an average price of approximately $ 14.02 per share, including a commission of $ 0.035 per share, for a total cost of $ 40,910 for the Series D Preferred Stock. Any repurchased shares are treated as authorized and unissued in accordance with Maryland law and shown as a reduction of stockholders’ equity at cost. Cash Dividends. For the year ended December 31, 2024 , the Company did not declare and pay a Series A Common Stock cash dividend. For the year ended December 31, 2023 , the Company declared and paid Series A Common Stock cash dividends of approximately $ 1.2 million. For the years ended December 31, 2024 and December 31, 2023 , the Company declared and paid Series D Preferred Stock cash dividends of approximately $ 2.2 million and $ 2.1 million, respectively. The following is a summary of distributions declared per share of our Series A Common Stock and for our Series D Preferred Stock for the years ended December 31, 2024 and 2023 . The Company intends to continue to pay dividends to our common stockholders on a quarterly basis, and on a monthly basis to holders of our Series D Preferred Stock going forward, but there can be no guarantee the Board of Directors will approve any future dividends. The following is a summary of distributions declared per share of our Series A Common Stock and for our Series D Preferred Stock for the years ended December 31, 2024 and December 31, 2023 . Series A Common Stock Quarter Ended 2024 2023 Distributions Declared Distributions Declared March 31 $ — $ 0.022 June 30 — 0.023 September 30 — 0.023 December 31 — 0.023 Total $ — $ 0.091 Series D Preferred Stock Month 2024 2023 Distributions Declared Distributions Declared January $ 0.19531 $ 0.19531 February 0.19531 0.19531 March 0.19531 0.19531 April 0.19531 0.19531 May 0.19531 0.19531 June 0.19531 0.19531 July 0.19531 0.19531 August 0.19531 0.19531 September 0.19531 0.19531 October 0.19531 0.19531 November 0.19531 0.19531 December 0.19531 0.19531 Total $ 2.34372 $ 2.34372 F- 31 Table of Contents Partnership Interests. Through the Company, its subsidiaries, and its partnerships, we own 12 commercial properties in fee interest, two of which we own partial interests in through our holdings in various affiliates in which we serve as general partner, member and/or manager. Each of the limited partnerships is referred to as a “DownREIT.” In each DownREIT, we have the right, through put and call options, to require our co-investors to exchange their interests for shares of our Common Stock at a stated price after a defined period (generally five years from the date they first invested in the entity’s real property), the occurrence of a specified event or a combination thereof. The Company is a limited partner in five partnerships and sole stockholder in one corporation, which entities purchase and lease model homes from homebuilders. 12. SHARE-BASED INCENTIVE PLAN The Company maintains a restricted stock incentive plan for the purpose of attracting and retaining officers, employees, and non-employee board members. Share awards generally vest in equal annual installments over a three -to- ten year period from date of issuance. Non-vested shares have voting rights and are eligible for any dividends paid on shares of common stock. The Company recognized compensation cost for these fixed awards over the service vesting period, which represents the requisite service period, using the straight-line method. Prior to our IPO, the value of non-vested shares was calculated based on the offering price of the shares in the most recent private placement offering of $ 20.00 , adjusted for stock dividends since granted and assumed selling costs, which management believed approximated fair market value as of the date of grant. Upon our IPO, the value of non-vested shares granted is generally calculated based on the closing price of our common stock on the date of the grant. During our Annual Stockholders meeting, held on May 26, 2022, the Company's 2017 Incentive Award Plan was amended to increase the available shares for issuance from 1.1 million to 2.5 million and at our Annual Stockholders meeting, held on June 1, 2023, the Company's 2017 Incentive Award Plan was amended to increase the available shares for issuance from 2.5 million to 3.5 million and add an evergreen provision to, on April 1 st and October 1 st of each year, automatically increase the maximum number of shares of common stock available under the plan to 15% of the Company’s outstanding shares of common stock, if on such date 3,500,000 (as adjusted for any reverse splits) is less than 15% of the Company’s then-outstanding shares of common stock. During our Annual Stockholders meeting, held on May 26, 2022, the Company's 2017 Incentive Award Plan was amended to increase the available shares for issuance from 1.1 million to 2.5 million and at our Annual Stockholders meeting, held on June 1, 2023, the Company's 2017 Incentive Award Plan was amended to increase the available shares for issuance from 2.5 million to 3.5 million and add an evergreen provision to, on April 1 st and October 1 st of each year, automatically increase the maximum number of shares of common stock available under the plan to 15% of the Company's outstanding shares of common stock, if on such date 3,500,000 (as adjusted for any reverse splits) is less than 15% of the Company's then-outstanding shares of common stock. A summary of the activity for the Company’s restricted stock was as follows: Outstanding shares: Common Shares Balance at December 31, 2023 760,995 Granted 1,288,493 Forfeited ( 205,019 ) Vested ( 673,664 ) Balance at December 31, 2024 1,170,805 The non-vested restricted shares outstanding as of December 31, 2024 , will vest over the next one to four years. As of December 31, 2024 , there were approximately 213,000 shares available to grant under the Company's 2017 Incentive Award Plan. Removed from the Granted and Vested totals noted above are 149,253 shares of common stock that were granted to the CEO in connection to his annual bonus in March 2024, as set by the Board of Directors, that vested immediately. These 149,253 shares were voluntarily returned to the Company in December 2024 by the CEO so they could be distributed to the employees as part of their annual grants in 2025. Share-based compensation expense was approximately $ 1.4 million and $ 1.0 million for the years ended December 31, 2024 and 2023 , respectively. As of December 31, 2024 , future unrecognized stock compensation related to unvested shares totaled approximately $ 1.4 million. F- 32 Table of Contents 13. SEGMENTS The Company’s reportable segments consist of three types of real estate properties for which the Company’s chief operating decision maker (CODM), which is our Chief Executive Officer ("CEO"), as the CEO has the final decision when allocating capital and personnel to the various segments, internally evaluate operating performance and financial results: Office/Industrial Properties, Model Home Properties and Retail Properties. The Company also has certain corporate-level activities including accounting, finance, legal administration, and management information systems which are not considered separate operating segments. There is no material inter-segment activity. The CODM evaluates the performance of our segments based upon an internal net operating income (“NOI”), which is a non-GAAP supplemental financial measure on a quarterly basis as disclosed in the 10 -Qs and 10 -Ks. We believe that NOI is a widely accepted measure of comparative operating performance in the real estate community. However, our use of the term NOI may not be comparable to that of other real estate companies as they may have different methodologies for computing this amount. The Company defines NOI for its segments as operating revenues (rental income, tenant reimbursements, parking income, and other operating income, net of provision for bad debt) less rental operating costs (property operating expenses, real estate taxes, insurance, utilities, repairs and maintenance, and asset management fees) excluding interest expense. NOI excludes certain items that are not considered to be controllable in connection with the management of an asset such as non-property income & expenses, depreciation & amortization, real estate acquisition fees & expenses, non-cash impairments and corporate general & administrative expenses. Quarterly the Company reviews and test for non-cash impairments, as required by GAAP, on all our properties ( i.e. Office/Industrial properties, Retail properties, and Model Home segments); however, the CODM does not consider those non-cash impairments with evaluating the segment’s cash operations and NOI. The CODM uses NOI to evaluate and assess each segments' performance and in deciding how to allocate resources. For Model Home performance the CODM also includes the gain or loss on sale of real estate assets net of any impairments, because they believe that is a major component in the operating success of the segment and part of the business model for Model Homes. The gain on sale of model homes resulted in cash flows to the Company that the CODM can decide on how to allocate to future operations. The following tables compare the Company’s segment activity and NOI and adjusted NOI for Model Home income to its results of operations and financial position as of and for the years ended December 31, 2024 and 2023 , respectively. The line items listed in the below NOI tables include the significant expense considered by the CODM for cash allocations on future investments. The Other Non-Segment & Consolidating Items represent corporate activity, the investment in Conduit Pharmaceutical, and other eliminating items for consolidation. The information for Corporate and Other are presented to reconcile back to the consolidated statement of operations, but is not considered a reportable segment. This includes the loss on Conduit marketable securities. For the Year Ended December 31, 2024 Retail Office/Industrial Model Homes Corporate and Other Total Rental revenue $ 1,595,464 $ 9,778,458 $ 4,368,169 $ — $ 15,742,091 Recovery revenue 463,158 2,318,564 — — 2,781,722 Other operating revenue 62,041 241,530 68,084 29,807 401,462 Total revenues 2,120,663 12,338,552 4,436,253 29,807 18,925,275 Rental operating costs 608,667 6,136,564 171,621 ( 660,775 ) 6,256,077 Net Operating Income (NOI) 1,511,996 6,201,988 4,264,632 690,582 12,669,198 Gain on Sale - Model Homes — — 3,426,572 — 3,426,572 Impairment of Model Homes — — ( 406,374 ) — ( 406,374 ) Adjusted NOI $ 1,511,996 $ 6,201,988 $ 7,284,830 $ 690,582 $ 15,689,396 F- 33 Table of Contents For the Year Ended December 31, 2023 Retail Office/Industrial Model Homes Corporate and Other Total Rental revenue $ 1,488,167 $ 9,000,917 $ 4,142,765 $ — $ 14,631,849 Recovery revenue 393,612 2,366,936 — — 2,760,548 Other operating revenue 2,551 207,102 ( 10,636 ) 44,200 243,217 Total revenues 1,884,330 11,574,955 4,132,129 44,200 17,635,614 Rental operating costs 537,389 5,901,042 156,493 ( 632,006 ) 5,962,918 Net Operating Income (NOI) 1,346,941 5,673,913 3,975,636 676,206 11,672,696 Gain on Sale - Model Home — — 3,240,200 — 3,240,200 Impairment of Model Homes — — ( 431,984 ) — ( 431,984 ) Adjusted NOI $ 1,346,941 $ 5,673,913 $ 6,783,852 $ 676,206 $ 14,480,912 Since a significant portion of the total operating expense for Retail and Office/Industrial are recouped as part of recovery revenue, the CODM looks at NOI as a whole when reviewing the segments. For the Model Home segment, the properties are leased on a triple net basis and the tenants are responsible for a significant portion of the operating expenses. Therefore the CODM focuses on Model Home revenue, any impairments and the gain on sale of model homes. The CODM reviews on a regular basis the GAAP performance of each segment, including the significant segment expenses reported for GAAP shown in the table below. Our significant segment expenses include consolidated expense categories presented in our consolidated statements of operations, as well as rental operating costs. This information is provided to the CODM and factors into the CODM’s decision making for company-wide strategy. The following tables compare the Company’s segment activity and to its results of GAAP operations and financial position as of and for the years ended December 31, 2024 and 2023 , respectively. The information for Corporate and Other are presented to reconcile back to the consolidated statement of operations, but is not considered a reportable segment as noted above. For the Year Ended December 31, 2024 Retail Office/Industrial Model Homes Corporate and Other Total Revenues: Rental income $ 2,058,622 $ 12,097,022 $ 4,368,169 $ — $ 18,523,813 Fees and other income 62,041 241,530 68,084 29,807 401,462 Total revenue 2,120,663 12,338,552 4,436,253 29,807 18,925,275 Costs and expenses: Rental operating costs 608,667 6,136,564 171,621 ( 660,775 ) 6,256,077 General and administrative — 2,330 820,217 6,704,128 7,526,675 Depreciation and amortization 394,461 4,154,769 952,627 13,661 5,515,518 Impairment of goodwill and real estate assets — 1,377,937 406,374 185,000 1,969,311 Total costs and expenses 1,003,128 11,671,600 2,350,839 6,242,014 21,267,581 Other income (expense): Interest expense - mortgage notes ( 577,761 ) ( 3,457,360 ) ( 2,009,641 ) ( 5,434 ) ( 6,050,196 ) Interest and other income, net — ( 171,734 ) ( 23,890 ) 44,268 ( 151,356 ) Net loss in Conduit Pharmaceuticals marketable securities (see footnote 9) — — — ( 17,925,723 ) ( 17,925,723 ) Gain on deconsolidation of SPAC (see footnote 9) — — — — — Gain on sales of real estate, net — — 3,426,572 — 3,426,572 Income tax (expense) benefit — — ( 55,543 ) ( 5,312 ) ( 60,855 ) Total other income, net ( 577,761 ) ( 3,629,094 ) 1,337,498 ( 17,892,201 ) ( 20,761,558 ) Net income (loss) 539,774 ( 2,962,142 ) 3,422,912 ( 24,104,408 ) ( 23,103,864 ) Less: Income attributable to noncontrolling interests — ( 86,686 ) ( 2,437,979 ) — ( 2,524,665 ) Net income (loss) attributable to Presidio Property Trust, Inc. stockholders $ 539,774 $ ( 3,048,828 ) $ 984,933 $ ( 24,104,408 ) $ ( 25,628,529 ) F- 34 Table of Contents For the Year Ended December 31, 2023 Retail Office/Industrial Model Homes Corporate and Other Total Revenues: Rental income $ 1,881,780 $ 11,367,853 $ 4,142,764 $ — $ 17,392,397 Fees and other income 2,550 207,102 ( 10,635 ) 44,200 243,217 Total revenue 1,884,330 11,574,955 4,132,129 44,200 17,635,614 Costs and expenses: Rental operating costs 537,389 5,901,042 156,493 ( 632,006 ) 5,962,918 General and administrative — 18,691 865,368 5,906,373 6,790,432 Depreciation and amortization 456,277 3,912,202 1,015,691 41,569 5,425,739 Impairment of goodwill and real estate assets — 1,966,113 431,984 849,000 3,247,097 Total costs and expenses 993,666 11,798,048 2,469,536 6,164,936 21,426,186 Other income (expense): Interest expense - mortgage notes ( 588,405 ) ( 2,744,996 ) ( 1,668,855 ) ( 2,633 ) ( 5,004,889 ) Interest and other income, net — — ( 27,775 ) 1,463,073 1,435,298 Net gain in Conduit Pharmaceuticals marketable securities (see footnote 9) — — — ( 23,359,774 ) ( 23,359,774 ) Gain on deconsolidation of SPAC (see footnote 9) — — — 40,321,483 40,321,483 Gain on sales of real estate, net — — 3,240,200 — 3,240,200 Income tax (expense) benefit — — 400,464 ( 64,684 ) 335,780 Total other income, net ( 588,405 ) ( 2,744,996 ) 1,944,034 18,357,465 16,968,098 Net income (loss) 302,259 ( 2,968,089 ) 3,606,627 12,236,729 13,177,526 Less: Income attributable to noncontrolling interests — ( 94,500 ) ( 2,936,580 ) — ( 3,031,080 ) Net income (loss) attributable to Presidio Property Trust, Inc. stockholders $ 302,259 $ ( 3,062,589 ) $ 670,047 $ 12,236,729 $ 10,146,446 F- 35 Table of Contents December 31, December 31, Assets by Reportable Segment: 2024 2023 Office/Industrial Properties: Land, buildings and improvements, net (1) $ 74,425,180 $ 77,472,724 Total assets (2) $ 76,292,662 $ 78,140,372 Model Home Properties: Land, buildings and improvements, net (1) $ 37,416,000 $ 50,790,147 Total assets (2) $ 38,166,964 $ 51,456,292 Retail Properties: Land, buildings and improvements, net (1) $ 15,743,789 $ 15,877,190 Total assets (2) $ 16,673,605 $ 16,539,399 Reconciliation to Total Assets: Total assets for reportable segments $ 131,133,231 $ 146,136,063 Corporate and other assets: Cash, cash equivalents and restricted cash 564,922 277,143 Other assets, net 10,871,497 29,549,432 Total Assets $ 142,569,650 $ 175,962,638 ( 1 ) Includes lease intangibles and the land purchase option related to property acquisitions. ( 2 ) Includes land, buildings and improvements, cash, cash equivalents, and restricted cash, current receivables, deferred rent receivables and deferred leasing costs and other related intangible assets, all shown on a net basis. For the Year Ended December 31, Capital Expenditures by Reportable Segment 2024 2023 Office/Industrial Properties: Capital expenditures and tenant improvements, office $ 2,044,704 $ 6,217,027 Model Home Properties: Acquisition of operating properties, model home 9,729,351 21,909,963 Retail Properties: Capital expenditures and tenant improvements, retail 217,121 150,522 Totals: Acquisition of operating properties, net 9,729,351 21,909,963 Capital expenditures and tenant improvements 2,261,825 6,367,549 Total real estate investments $ 11,991,176 $ 28,277,512 14. INCOME TAX PROVISION The Company accounts for income taxes under the asset and liability method under which it recognizes deferred income taxes, net of valuation allowances, if any, for the estimated future tax effects of temporary differences between the financial statement carrying amounts of existing assets and liabilities and its tax bases and net operating loss and tax credit carryforwards. The Company may, from time to time, be assessed interest or penalties by tax jurisdictions, although any such assessments historically have been minimal and immaterial to its financial results. In the event the Company has such an assessment from a taxing authority, it is its accounting policy to recognize any interest and penalties as a component of income tax. We, together with one of our entities, have elected to treat certain subsidiaries as a taxable REIT subsidiary (a “TRS”) for federal income tax purposes. Certain activities that we undertake must be conducted by a TRS, such as non-customary services for our tenants, and holding assets that we cannot hold directly. A TRS is subject to federal and state income taxes. The Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. Neither the Company nor its subsidiaries have been assessed any significant interest or penalties for tax positions by any tax jurisdictions. F- 36 Table of Contents Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those 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. The provision (benefit) for income taxes related to our TRS entities consists of the following for the years ended December 31, 2024 and 2023 : December 31, 2024 December 31, 2023 Current income tax expense (benefit) Federal $ ( 17,835 ) $ 100,036 State 30,572 ( 89,054 ) Total current income tax expense (benefit) 12,737 10,982 Deferred income tax expense (benefit) Federal 40,279 ( 289,480 ) State 7,839 ( 57,282 ) Total deferred income tax expense (benefit) 48,118 ( 346,762 ) Change in Valuation Allowance — — Total income tax (benefit) expense $ 60,855 $ ( 335,780 ) Income tax provision differed from the amount computed by applying the U.S. federal income tax rate of 21 % to income (loss) before taxes, as follows: December 31, 2024 December 31, 2023 Taxes at federal statutory rate $ 103,369 21 % $ 1,370,497 21 % State Taxes 48,564 10 % 21,821 0 % Deconsolidation adjustment — 0 % ( 1,303,720 ) -20 % True Up Adjustment ( 91,078 ) -19 % ( 424,378 ) -7 % Total income tax (benefit) expense $ 60,855 12 % $ ( 335,780 ) -5 % The tax effects of temporary differences which give rise to significant portions of deferred tax assets are as follows as of December 31: For The Years Ended 2024 2023 Deferred Tax Assets Deferred Revenue $ — $ 42,792 State Taxes 8 781 Fixed Asset 243,662 278,646 Start up costs 54,974 24,543 Total deferred tax asset 298,644 346,762 Deferred Tax Liabilities Basis difference in investments — — Net deferred tax assets 298,644 346,762 Valuation allowance — — Net deferred tax assets (liability) $ 298,644 $ 346,762 F- 37 Table of Contents Management assessed the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective positive evidence evaluated was the history of cumulative income for Model Homes Inc. incurred over the three -year period ended December 31, 2023. Such objective evidence provides support for no valuation allowance to be recorded for the year ended December 31, 2023. The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. The Company is no longer subject to U.S. federal, state, and local or non-U.S. income tax examinations by tax authorities for years before 2020. In December 2023, the FASB issued ASU 2023 - 09, Income Taxes (Topic 740 ): Improvements to Income Tax Disclosures, which improves income tax disclosures through enhanced disaggregation within the rate reconciliation table and disaggregation of income taxes paid by jurisdiction. The amendment is effective for fiscal years beginning after December 15, 2024 and early adoption is permitted. The amendments should be applied on a prospective basis, however, retrospective application is permitted. The adoption of this ASU only impacted disclosures with no impact on the Company’s consolidated financial statements. 15. RELATED PARTY TRANSACTIONS During the years ended December 31, 2024 and 2023 , the Company leased a portion of its corporate headquarters to a company that is owned 100 % by the CEO, which is Puppy Toes, Inc. Note that Centurion Counsel is another entity that pays rent to the Company and it is consolidated into Puppy Toes, Inc. This is a continuation of the same related party transaction from 2020, which began in 2019 when we moved our corporate headquarters to Genesis Plaza. Puppy Toes, Inc has leased space from the Company since November 2008. Rent billed to these entities from the Company totaled $ 11,442 and $ 10,752 , for the years ended December 31, 2024 and 2023 , and is included in the rent paid by Presidio Property Trust to Genesis Plaza. Additionally, we received full payroll reimbursement for employee services relate to Centurion Counsel and Puppy Toes, Inc. during the years ended December 31, 2024 and 2023 ., which totaled approximately $ 141,429 and $$ 154,895 , respectively. These reimbursements were at cost and were not marked up or discounted. As of December 31, 2024 and 2023, we had a reimbursement receivable balance of approximately $ 12,376 and $ 52,879 , which were paid in full during January 2025 and January 2024, respectively. 16. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date through the date the financial statements were issued. Based upon this review, except as disclosed below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the financial statements other than disclosed below. The sale of UTC and Research Parkway took place in February 2025, to a single buyer, for a combined sales price of $ 16.95 million, where the Company netted approximately $ 6.37 million in cash proceeds from the sale and additional funds post-closing from the lender reserve accounts. The commercial properties were purchased between 2014 and 2015 for approximately $ 14.1 million, with a combined book value of approximately $ 11.6 million prior to the sale, and the Company recorded a combined gain of approximately $ 4.0 million. During January, February and March 2025, the Company has sold five model homes for a total of approximately $ 2.4 million. The homes were purchased between 2019 and 2023 with a total acquisition price of approximately $ 2.2 million. F- 38 Table of Contents Presidio Property Trust, Inc. and Subsidiaries Schedule III - Real Estate and Accumulated Depreciation and Amortization – as of December 31, 2024 All amounts are in thousands Initial Cost Total Cost (1 ) Property Name/ Location Encumbrances Land Cost Building & Improvements Acquisition Price Capitalized Improvements Land Cost Building & Improvements Total Cost Accumulated Depreciation & Amortization Reserve for Impairment NBV Real Estate Date Acquired Year Built/ Renovated Genesis Plaza, San Diego, CA $ 5,814 $ 1,400 $ 8,600 $ 10,000 $ 3,490 $ 1,400 $ 12,090 $ 13,490 $ 6,127 $ - $ 7,363 08/10 1989 Dakota Center, Fargo, ND 9,091 832 8,743 9,575 4,289 832 13,032 13,864 5,053 656 8,155 05/11 1982 Grand Pacific Center, Bismarck, ND 6,460 413 4,926 5,339 6,056 413 10,982 11,395 2,981 - 8,414 03/14 1976 Arapahoe Center, Centennial, CO 8,670 1,420 10,430 11,850 1,608 1,420 12,038 13,458 4,160 - 9,298 12/14 2000 West Fargo Industrial, Fargo, ND 5,750 1,693 6,207 7,900 709 1,693 6,916 8,609 2,010 - 6,599 08/15 1998/2005 300 N.P., Fargo, ND - 135 3,715 3,850 418 135 4,133 4,268 1,275 1,030 1,963 08/15 1922 One Park Centre, Westminster, CO 5,920 1,206 7,944 9,150 2,387 1,206 10,331 11,537 3,989 1,966 5,582 08/15 1983 Shea Center II, Highlands Ranch, CO 16,661 2,214 23,747 25,961 3,782 2,214 27,529 29,743 10,922 - 18,821 12/15 2000 McElderry, Baltimore, MD 5,670 215 8,677 8,892 28 215 8,705 8,920 679 8,241 12/20 2006 Total Office/ Industrial properties 64,036 9,528 82,989 92,517 22,767 9,528 105,756 115,284 37,196 3,652 74,436 Union Town Center, Colorado Springs, CO 7,710 1,750 9,462 11,212 534 1,750 9,996 11,746 2,823 - 8,923 12/14 2003 Research Parkway, Colorado Springs, CO 1,527 408 2,442 2,850 ( 36 ) 408 2,406 2,814 593 - 2,221 08/16 2003 Mandolin, Houston, TX 3,508 1,330 3,562 4,892 15 1,330 3,577 4,907 306 - 4,601 08/21 2021 Total Retail properties 12,745 3,488 15,466 18,954 513 3,488 15,979 19,467 3,722 - 15,745 Model Homes-DMH LP #202 - - - - - - - - - - - Model Homes-DMH LP #203 216 90 271 361 - 90 271 361 35 - 326 07/11 2019 Model Homes-DMH LP #204 218 65 299 364 - 65 299 364 33 - 331 07/12 2020 Model Homes-DMH LP #205 1,442 407 2,004 2,411 - 407 2,004 2,411 252 - 2,159 2019 - 2020 2019 - 2020 Model Homes-DMH LP #206 - - - - - - - - - - - Model Homes-DMH LP #207 5,615 1,457 6,795 8,252 - 1,457 6,795 8,252 191 - 8,061 07/15 2023 Model Homes-NMH Inc. 18,570 4,604 23,055 27,659 - 4,604 23,055 27,659 931 190 26,538 2020 - 2024 2020 - 2024 Total Model Home properties 26,061 6,623 32,424 39,047 - 6,623 32,424 39,047 1,442 190 37,415 - CONSOLIDATED TOTALS: $ 102,842 $ 19,639 $ 130,879 $ 150,518 $ 23,280 $ 19,639 $ 154,159 $ 173,798 $ 42,360 $ 3,842 $ 127,596 ( 1 ) Depreciation is computed on a straight-line basis using useful lives up to 39 years. F- 39 Table of Contents Presidio Property Trust, Inc. and Subsidiaries Schedule III - Real Estate and Accumulated Depreciation and Amortization (continued) – as of December 31, 2024 For the Year Ended December 31, 2024 2023 Real estate Balance at the beginning of the year $ 183,238,901 $ 165,316,008 Acquisitions 9,729,351 21,909,963 Improvements 2,261,826 6,663,116 Impairments ( 1,784,311 ) ( 2,398,097.0 ) Dispositions of real estate ( 23,489,755 ) ( 8,252,089 ) Balance at the end of the year $ 169,956,012 $ 183,238,901 Accumulated depreciation and amortization Balance at the beginning of the year $ ( 39,083,117 ) $ ( 34,803,778 ) Depreciation and amortization expense ( 5,021,653 ) ( 4,925,463 ) Dispositions of real estate 1,745,258 646,124 Balance at the end of the year $ ( 42,359,512 ) $ ( 39,083,117 ) Real estate assets, net $ 127,596,500 $ 144,155,784 F-40