| SEGMENT REPORTING |
NOTE 3 – segment reporting We report our results in two reportable segments: residential and commercial properties. Our residential properties include multifamily properties. Our commercial properties include retail, office, industrial, restaurant and medical properties. We assess and measure operating results based on net operating income (“NOI”), which we define as total real estate segment revenues less real estate expenses (which consist of real estate taxes, property management fees, utilities, repairs and maintenance, insurance, and property administrative and management fees). We believe NOI is an important measure of operating performance even though it should not be considered an alternative to net income or cash flow from operating activities. NOI is unaffected by financing, depreciation, amortization, legal and professional fees, and certain general and administrative expenses. The accounting policies of each segment are consistent with those described in Note 2 of this report. Segment Revenues and Net Operating Income The revenues and net operating income for the reportable segments (residential and commercial) are summarized as follows for the three and six months ended June 30, 2025 and 2024, along with reconciliations to the consolidated financial statements. Segment assets are also reconciled to total assets as reported in the consolidated financial statements. | | | | | | | | | | | | | | | | | | | | | Three months ended June 30, 2025 | | Three months ended June 30, 2024 | | | Residential | | Commercial | | Total | | Residential | | Commercial | | Total | | | | (in thousands) | | (in thousands) | Income from rental operations | | $ | 38,147 | | $ | 4,853 | | $ | 43,000 | | $ | 34,248 | | $ | 5,049 | | $ | 39,297 | Real Estate Expenses | | | | | | | | | | | | | | | | | | | Real Estate Taxes | | | 3,748 | | | 474 | | | 4,222 | | | 4,307 | | | 462 | | | 4,769 | Property Management | | | 4,812 | | | 215 | | | 5,027 | | | 4,459 | | | 247 | | | 4,706 | Utilities | | | 2,975 | | | 217 | | | 3,192 | | | 2,467 | | | 239 | | | 2,706 | Repairs and Maintenance | | | 6,515 | | | 434 | | | 6,949 | | | 6,571 | | | 395 | | | 6,966 | Insurance | | | 1,423 | | | 40 | | | 1,463 | | | 1,551 | | | 40 | | | 1,591 | Expenses from rental operations | | | 19,473 | | | 1,380 | | | 20,853 | | | 19,355 | | | 1,383 | | | 20,738 | Net operating income | | $ | 18,674 | | $ | 3,473 | | $ | 22,147 | | $ | 14,893 | | $ | 3,666 | | $ | 18,559 | Depreciation and amortization 1 | | | | | | | | | 6,696 | | | | | | | | | 7,015 | Interest 1 | | | | | | | | | 6,371 | | | | | | | | | 5,585 | Administration of REIT 1 | | | | | | | | | 1,443 | | | | | | | | | 1,539 | Other income (expense) 1 | | | | | | | | | 722 | | | | | | | | | (1,723) | Net income | | | | | | | | $ | 6,915 | | | | | | | | $ | 6,143 | | | | | | | | | | | | | | | | | | | | 1 The financial information provided to the CODM for these expense categories are not reflected by segment to evaluate performance of our reportable segments. | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | Six months ended June 30, 2025 | | Six months ended June 30, 2024 | | | Residential | | Commercial | | Total | | Residential | | Commercial | | Total | | | | (in thousands) | | (in thousands) | Income from rental operations | | $ | 75,338 | | $ | 9,842 | | $ | 85,180 | | $ | 66,403 | | $ | 10,155 | | $ | 76,558 | Real Estate Expenses | | | | | | | | | | | | | | | | | | | Real Estate Taxes | | | 7,142 | | | 940 | | | 8,082 | | | 7,945 | | | 983 | | | 8,928 | Property Management | | | 9,727 | | | 450 | | | 10,177 | | | 8,893 | | | 439 | | | 9,332 | Utilities | | | 6,696 | | | 500 | | | 7,196 | | | 5,707 | | | 476 | | | 6,183 | Repairs and Maintenance | | | 13,112 | | | 958 | | | 14,070 | | | 12,814 | | | 773 | | | 13,587 | Insurance | | | 2,950 | | | 73 | | | 3,023 | | | 3,112 | | | 78 | | | 3,190 | Expenses from rental operations | | | 39,627 | | | 2,921 | | | 42,548 | | | 38,471 | | | 2,749 | | | 41,220 | Net operating income | | $ | 35,711 | | $ | 6,921 | | $ | 42,632 | | $ | 27,932 | | $ | 7,406 | | $ | 35,338 | Depreciation and amortization 1 | | | | | | | | | 13,721 | | | | | | | | | 12,924 | Interest 1 | | | | | | | | | 12,641 | | | | | | | | | 10,941 | Administration of REIT 1 | | | | | | | | | 2,944 | | | | | | | | | 2,885 | Loss on impairment of property 1 | | | | | | | | | — | | | | | | | | | — | Other income 1 | | | | | | | | | 1,504 | | | | | | | | | (2,195) | Net income | | | | | | | | $ | 11,822 | | | | | | | | $ | 10,783 | | | | | | | | | | | | | | | | | | | | 1 The financial information provided to the CODM for these expense categories are not reflected by segment to evaluate performance of our reportable segments. | | | | | | | | | | | | | | | | | | |
Segment Assets and Accumulated Depreciation | | | | | | | | | | As of June 30, 2025 | | Residential | | Commercial | | Total | | | | (in thousands) | Real estate investments | | $ | 927,659 | | $ | 179,519 | | $ | 1,107,178 | Accumulated depreciation | | | (194,094) | | | (55,767) | | | (249,861) | Total real estate investments, net | | $ | 733,565 | | $ | 123,752 | | $ | 857,317 | Lease intangible assets, less accumulated amortization | | | — | | | 2,023 | | | 2,023 | Cash and cash equivalents | | | | | | | | | 5,687 | Restricted deposits | | | | | | | | | 10,601 | Investment in unconsolidated affiliates | | | | | | | | | 27,991 | Notes receivable | | | | | | | | | 4,805 | Notes receivable, affiliates | | | | | | | | | 7,868 | Other assets, net | | | | | | | | | 23,662 | Total Assets | | | | | | | | $ | 939,954 |
| | | | | | | | | | As of December 31, 2024 | | Residential | | Commercial | | Total | | | | (in thousands) | Real estate investments | | $ | 916,559 | | $ | 178,856 | | $ | 1,095,415 | Accumulated depreciation | | | (183,753) | | | (53,663) | | | (237,416) | Total real estate investments, net | | $ | 732,806 | | $ | 125,193 | | $ | 857,999 | Lease intangible assets, less accumulated amortization | | | 199 | | | 2,342 | | | 2,541 | Cash and cash equivalents | | | | | | | | | 4,798 | Restricted deposits | | | | | | | | | 10,127 | Investment in unconsolidated affiliates | | | | | | | | | 28,407 | Notes receivable | | | | | | | | | 1,539 | Notes receivable, affiliates | | | | | | | | | 7,945 | Other assets, net | | | | | | | | | 24,416 | Total Assets | | | | | | | | $ | 937,772 |
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