v3.26.1
EARNINGS PER SHARE
 6 Months Ended
Jun. 30, 2026
Earnings Per Share [Abstract]  
EARNINGS PER SHARE EARNINGS PER SHARE
The Company is required to present both basic and diluted earnings per share (“EPS”). Basic EPS is calculated by dividing net income by the weighted average number of shares of common stock outstanding for the period. Diluted EPS is calculated using the treasury stock method by dividing net income by the weighted average number of shares of common stock outstanding plus the additional dilutive effect, if any, of common stock equivalents during each period. The effect of dilutive securities is presented net of tax.

The following table sets forth the components of basic and diluted EPS:
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Net Income (Loss)$2,005 $1,899 $16 $(1,493)
Net income attributable to the noncontrolling interests— 1 1 4 
Net Income (Loss) Attributable to Rithm Property Trust2,005 1,898 15 (1,497)
Dividends on preferred stock1,290 1,286 2,580 1,636 
Net Income (Loss) Attributable to Common Stockholders$715 $612 $(2,565)$(3,133)
Basic weighted average shares of common stock outstanding7,745,7797,569,7927,684,4747,569,484
Diluted weighted average shares of common stock outstanding(1)
7,745,7797,570,0617,684,4747,569,484
Basic Earnings (Loss) per Share Attributable to Common Stockholders$0.09 $0.08 $(0.33)$(0.41)
Diluted Earnings (Loss) per Share Attributable to Common Stockholders$0.09 $0.08 $(0.33)$(0.41)
(1)The Company’s 2024 Warrants (as defined in Note 14) and effect of restricted stock grants, as applicable, would have an anti-dilutive effect on diluted EPS for the six months ended June 30, 2026 and 2025 and have not been included in the calculation.
RELATED PARTY TRANSACTIONS RELATED PARTY TRANSACTIONS
A party is considered to be related to the Company if the party, directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners, management and directors, as well as members of their immediate families or any other parties with which the Company may deal if one party to a transaction controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.

Due from and Due to Related Parties

Amounts due from and due to related parties primarily relate to amounts arising from investment-related transactions and expenses funded on behalf of the Company by related parties. Amounts due from and due to related parties are presented within other assets and accrued expenses and other liabilities, respectively, on the consolidated balance sheets.

Management Agreement

The Company entered into the Management Agreement with RCM GA, a subsidiary of Rithm. The Management Agreement is in effect until June 11, 2027 and shall be automatically renewed for a successive two-year term each anniversary date thereafter unless terminated by either party. Under the Management Agreement, RCM GA implements the Company’s business strategy and manages the Company’s business and investment activities and day-to-day operations subject to oversight by the Company’s Board of Directors. Among other services, RCM GA provides the Company with a management team and necessary administrative and support personnel. Additionally, the Company pays directly for the internal audit function that reports directly to the Audit Committee and the Board of Directors. The Company does not currently have any employees and does not expect to have any employees in the foreseeable future. Each of the Company’s executive officers is an employee, consultant, contractor or officer of Rithm.

Under the Management Agreement, the Manager is entitled to a base management fee and an incentive fee to the Manager calculated and payable quarterly with respect to each calendar quarter (or partial quarter that the agreement is in effect) in cash or, at the election of the Manager, shares of the Company’s common stock. The base management fee equals 1.5% of the Company’s stockholders’ equity, including equity equivalents, per annum. Also, under the Management Agreement, the Company’s quarterly base management fee includes, in its computation of equity managed, its unsecured debt securities to the extent the proceeds were used to repurchase the some of the Company’s preferred stock.
The Manager is entitled to an incentive fee, which is payable quarterly in arrears in cash or, at the election of the Manager, in shares of the Company’s common stock in an amount equal to 20% of the dollar amount by which (i) Earnings Available for Distribution (as defined below) exceeds the product of (A) the average common book value per share (excluding fair value marks, impairments, transaction/ deal expenses and associated tax impact and such other items that in the judgment of the Company officers should be excluded) of the common stock of the Company during such calendar quarter and (B) 8%. Notwithstanding either of the foregoing, no incentive fee will be payable to the Manager with respect to any period unless the Company’s cumulative Earnings Available for Distribution is greater than zero for the most recently completed four calendar quarters (which cumulative Earnings Available for Distribution shall be reset at the completion of every fourth quarter following the date hereof and each subsequent fourth quarter thereafter (each, a “Reset Date”) so as not to take into account prior calendar quarters), or, if less, (i) the number of completed calendar quarters since the date hereof or (ii) the number of completed calendar quarters since the last Reset Date. “Earnings Available for Distribution” is defined as net income (loss) as determined according to GAAP, excluding tax-effected, non-cash equity compensation expense and any unrealized gains or losses from mark-to-market valuation changes (including impairments) that are included in net income for the applicable period. The amount will be adjusted to exclude on a tax-effected basis (A) one-time events pursuant to changes in GAAP, (B) transaction and deal expenses that in the opinion of the Manager should be excluded for purposes of calculating Earnings Available for Distribution and be amortized over the life of the related investment/transaction and (C) non-cash items (including depreciation and amortization) that in the judgment of the Company’s officers should not be included in Earnings Available for Distribution, which adjustments in clauses (A), (B) and (C) shall only be excluded after discussions between the Manager and the Company’s Independent Directors (as defined in the Management Agreement) and after approval by a majority of the Company’s Independent Directors. Book value per share of common stock shall be as set forth in the consolidated financial statements of the Company prepared in accordance with GAAP.

In addition to the base management fee and the incentive fee described above, the Company pays all of its costs and expenses and reimburses the Manager (to the extent incurred by the Manager) for the costs and expenses of providing services under the Management Agreement, including reimbursing the Manager or its affiliates, as applicable, for the Company’s allocable share of the compensation (whether paid in cash, stock or other forms), including annual base salary, bonus, any related withholding taxes and employee benefits, paid to (i) the Manager’s personnel serving as the Company’s chief financial officer based on the percentage of his or her time spent managing the Company’s affairs and (ii) other corporate finance, tax, accounting, middle office, internal audit, legal, risk management, operations, compliance and other non-investment personnel of the Manager and its affiliates who spend all or a portion of their time managing the Company’s affairs.

The Company will be required to pay the Manager a termination fee in the event that the Management Agreement is terminated as a result of (i) a termination by the Company without cause, (ii) its decision not to renew the Management Agreement for reasons including the failure to agree on revised compensation, (iii) a termination by the Manager as a result of the Company becoming regulated as an “investment company” under the Investment Company Act of 1940, as amended, (other than as a result of the acts or omissions of the Manager in violation of investment guidelines approved by the Company’s Board of Directors) or (iv) a termination by the Manager if the Company defaults in the performance of any material term of the Management Agreement (subject to a notice and cure period). The termination fee will be equal to three times the combined base fee and incentive fees payable to the Manager during the 12-month period ended as of the end of the most recently completed fiscal quarter prior to the date of termination.

Residential Servicing Agreements

Until June 1, 2024, the Company and its affiliates were party to various servicing agreements with its former servicer, and on June 1, 2024, the former servicer transferred all of the servicing agreements for its mortgage loans and real property (the “Residential Servicing Agreements”) to Newrez, a subsidiary of Rithm and an affiliate of the Company, pursuant to a servicing transfer agreement.

Servicing fees for mortgage loans range from 0.42% to 1.25% annually of UPB at acquisition (or the fair market value or purchase price of REO) and are paid monthly. The servicing fee is based upon the status of the loan at acquisition. Re-performing loans (“RPLs”) are residential mortgage loans on which at least five of the seven most recent payments have been made, or the most recent payment has been made and accepted pursuant to an agreement, or the full dollar amount, to cover at least five payments has been paid in the last seven months and non-performing loans (“NPLs”) are residential mortgage loans on which the most recent three payments have not been made. A change in status after acquisition from RPLs to NPLs does not cause a change in the servicing fee rate.
Servicing fees for the Company’s real property assets that are not held in joint ventures are the greater of (i) the servicing fee applicable to the underlying mortgage loan prior to foreclosure and (ii) 1.00% annually of the fair market value of the REO or 1.00% annually of the purchase price of any REO otherwise purchased by the Company.

Newrez is reimbursed for all customary, reasonable and necessary out-of-pocket costs and expenses incurred in the performance of its obligations, including the actual cost of any repairs and renovations to foreclosed property undertaken on the Company’s behalf. The total fees incurred by the Company for these services are dependent upon the following: (i) for fees based on mortgage loans, the total fees will be dependent upon the UPB and the type of mortgage loans that the Residential Servicer services; and (ii) for fees based on REO properties, property values, previous UPB of the relevant loan and the number of REO properties.

If any Residential Servicing Agreement has been terminated other than for cause and/or the Residential Servicer terminates any Residential Servicing Agreement, the Company will be required to pay a termination fee equal to the aggregate servicing fees payable under the applicable Residential Servicing Agreement for the immediately preceding 12-month period.

Equity Holdings by Rithm and Its Affiliates in the Company

As of June 30, 2026 and December 31, 2025, the Manager of the Company and its affiliates held 766,143 and 549,663 shares of its common stock, respectively, in addition to 544,154 exercisable 2024 Warrants (as defined in Note 14).

As of June 30, 2026, an affiliate of the Manager held 400,000 shares of the Company’s Series C Preferred Stock (as defined in Note 14) issued in the first quarter of 2025 at the public offering price of $25.00 per share.

Elecor Investment
In December 2025, as part of the execution of its CRE investment strategy, the Company acquired an indirect minority interest in PGOP, which through its affiliates and joint ventures owns the Elecor Portfolio, in connection with Rithm’s acquisition of Elecor. The Company made an aggregate cash contribution of $50.0 million in exchange for an indirect 3.9% ownership interest in the Aggregators, which indirectly hold the Elecor Portfolio. The Company also committed to make additional cash capital contributions of up to $7.5 million under certain circumstances in exchange for additional limited partnership interests. Affiliates of Rithm own the remaining limited partnership interests in PGOP through the aggregator vehicles and serve as the general partner of the aggregator vehicles. For information on investments in affiliates, see Note 8.
Flow MLPA & Genesis Servicing Agreement
During the second quarter of 2026, the Company entered into the Flow MLPA between a subsidiary of the Company and the RTL Seller, a subsidiary of Rithm and an affiliate of the Company, which provides that the Company or its subsidiaries may, from time to time, purchase, on a servicing-released basis, one or more portfolios of RTLs originated by Genesis that meet certain eligibility criteria. The Flow MLPA contains customary terms governing periodic RTL sales, including representations and warranties relating to the origination, underwriting, documentation and legal compliance of the RTLs, as well as the RTL Seller’s repurchase for loans that fail to conform to the requirements of the Flow MLPA. The Company’s obligation to purchase any mortgage loan is subject to standard conditions precedent, including, among other matters, the delivery of specified loan documentation. In May 2026, pursuant to the Flow MLPA, the Company purchased RTLs with a UPB of approximately $102.1 million for an aggregate purchase price of approximately $103.0 million.
In connection with the purchase of the RTLs, Genesis was appointed as servicer for the RTLs pursuant to a servicing agreement, dated April 29, 2026, between the Company (through its subsidiary) and Genesis (the “Genesis Servicing Agreement”). Genesis receives a servicing and asset management fee equal to 0.75% annually of the UPB of each RTL (or the fair market value of any related REO property) and is reimbursed for certain servicing-related expenses incurred in the performance of its obligations under the Genesis Servicing Agreement.
The Genesis Servicing Agreement may be terminated by the Company at any time, without cause, upon 30 days’ prior written notice to Genesis.