As of September 30, 2026, assets and liabilities related to REO consisted of seven properties: five multifamily properties, one located in each of Arlington Heights, IL, Chicago, IL and Plano, TX; two located in San Antonio, TX; and two office properties, one located in each of Manhattan, NY, and Houston, TX. The Company acquired one REO property during the three and nine months ended September 30, 2026. The Company recorded the property and its net assets on the consolidated balance sheets with an estimated fair value of $29.8 million, which included $30.1 million of REO and net working capital of ($0.3) million.

In 2022, the Company originated a $46.2 million senior loan secured by a multifamily property in Plano, TX. As of June 30, 2026, the loan had a risk rating of "4" and was on non-accrual status. Prior to conversion, the loan had an amortized cost and carrying value of $42.8 million and $29.8 million, respectively. On September 1, 2026, the Company acquired the property via a non-judicial foreclosure. The Company recognized a realized loss on REO conversion of $13.0 million.

The Company accounted for this acquisition as an asset acquisition. The Company allocated the fair value of the assets acquired on the acquisition date as follows (dollars in thousands):

The Company's fair market value estimate was determined primarily using discounted cash flow models and Level 3 inputs, which include estimates of property-specific cash flows over a specific holding period, a discount rate of 8.3% and a terminal capitalization rate of 6.4%. These inputs are based on the location, type and nature of the property, costs-to-complete, expected time required to lease and stabilize the property, current sales and lease comparables, anticipated real estate and capital markets conditions, and management's knowledge, experience, and judgment.

During September 2026, the Company obtained from a third party a $29.1 million first mortgage loan secured by the Plano, TX multifamily property, which is classified as Mortgage loans payable, net in the Company's consolidated balance sheets. See Note 6 for details of the Mortgage loan payable.

During June 2023, the Company obtained from a third party a $31.2 million first mortgage loan secured by the Houston, TX office property, which is classified as Mortgage loans payable, net on the Company's consolidated balance sheets. See Note 6 for details of the Mortgage loan payable.


	September 30, 2026		December 31, 2025
Assets
Cash	$	20,784	$	18,018
Real estate owned - Building and building improvements	200,058		172,724
Real estate owned - Land and land improvements	62,618		54,845

Real estate owned - Tenant improvements	10,520		9,113
Real estate owned	273,196		236,682
Accumulated depreciation	(17,983)		(12,296)
Real estate owned, net	255,213		224,386
In-place lease intangibles, net(1)	8,913		10,687
Above-market lease intangibles, net(1)	1,368		1,685
Leasing commissions, net(1)	2,536		2,748
Other assets, net(1)	10,829		9,555
Total assets	$	299,643	$	267,079
Liabilities
Mortgage loans payable, net(2)	$	59,950	$	30,838
Below-market lease intangibles, net(3)	1,345		1,763
Other liabilities(3)	6,794		8,453
Total liabilities	$	68,089	$	41,054

(1)Included within Other assets within the Company's consolidated balance sheets. Other assets, net includes $2.4 million and $3.7 million of cash proceeds from the Company's mortgage loan payable escrowed for tenant improvements and leasing costs, and other working capital balances as of September 30, 2026 and December 31, 2025, respectively.

(2)During the three and nine months ended September 30, 2026, the Company incurred interest expense of $0.6 million and $1.9 million, respectively, which is included within Interest expense on the Company's consolidated statements of income and comprehensive income. During the three and nine months ended September 30, 2025, the Company incurred interest expense of $0.6 million and $1.9 million, respectively, which is included within Interest expense on the Company's consolidated statements of income and comprehensive income.

(3)Included within Accrued expenses and other liabilities within the Company's consolidated balance sheets. Other liabilities includes $0.2 million and $0.2 million of accrued interest payable as of September 30, 2026 and December 31, 2025, respectively, which is included within Accrued interest payable within the Company's consolidated balance sheets.

Rental income primarily relates to the Company's acquired and newly executed tenant leases. These leases entitle the Company to receive contractual rent payments during the lease periods and in some instances tenant reimbursements for certain property operating expenses, including common area costs, insurance, utilities and real estate taxes. The Company elected the practical expedient to not separate the lease and non-lease components of the rent payments and accounts for these leases as operating leases.


	Three Months Ended				Nine Months Ended
	September 30, 2026		September 30, 2025		September 30, 2026		September 30, 2025
Rental income
Minimum lease payments	$	6,917	$	6,722	$	20,539	$	21,753
Variable lease payments	952		1,163		3,023		2,518
Total rental income	7,869		7,885		23,562		24,271
Other revenue from REO	209		71		1,885		2,195
Revenue from real estate owned operations	8,078		7,956		25,447		26,466
Rental property operating expenses(1)	6,032		5,581		16,368		18,772
Depreciation and amortization(2)	2,477		2,712		7,676		10,127
Expenses from real estate owned operations	8,509		8,293		24,044		28,899
Net income (loss) from REO	$	(431)	$	(337)	$	1,403	$	(2,433)

(1)Excludes $0.6 million and $1.9 million, respectively, of interest expense incurred during the three and nine months ended September 30, 2026, which is included within Interest expense on the Company's consolidated statements of income and comprehensive income. Excludes $0.6 million and $1.9 million, respectively, of interest expense incurred during the three and nine months ended September 30, 2025, which is included within Interest expense on the Company's consolidated statements of income and comprehensive income.

(2)During the three and nine months ended September 30, 2026, the Company incurred $1.9 million and $5.7 million, respectively, of depreciation expense. During the three and nine months ended September 30, 2025, the Company incurred $1.7 million and $5.9 million, respectively, of depreciation expense.

For the nine months ended September 30, 2026, the Company's capital expenditures were $7.4 million, as shown on the Company's consolidated statements of cash flows, which includes $0.2 million of accrued capital expenditures. For the nine months ended September 30, 2025, the Company's capital expenditures were $3.2 million, as shown on the Company's consolidated statements of cash flows, which includes $0.6 million of accrued capital expenditures.


	September 30, 2026		December 31, 2025
Intangible assets:
In-place lease intangibles	$	25,165	$	25,165
Above-market lease intangibles	2,670		2,670
Leasing commissions	3,170		3,164
Total intangible assets	31,005		30,999
Accumulated amortization:
In-place lease intangibles	(16,252)		(14,478)
Above-market lease intangibles	(1,302)		(985)
Leasing commissions	(634)		(416)
Total accumulated amortization	(18,188)		(15,879)
Intangible assets, net	$	12,817	$	15,120

Intangible liabilities:
Below-market lease intangibles	$	4,311	$	4,311
Total intangible liabilities	4,311		4,311
Accumulated amortization:
Below-market lease intangibles	(2,966)		(2,548)
Total accumulated amortization	(2,966)		(2,548)
Intangible liabilities, net	$	1,345	$	1,763


Year	In-place lease intangibles		Above-market lease intangibles		Leasing commissions		Below-market lease intangibles
2026 (remaining)	$	399	$	103	$	92	$	(74)
2027	1,315		374		374		(297)
2028	1,266		368		352		(289)
2029	872		110		340		(202)
2030	731		58		329		(142)
2031	631		56		284		(73)

The weighted average amortization period for the in-place lease intangibles, above-market lease intangibles, leasing commissions, and below-market lease intangibles as of September 30, 2026, were 10.2 years, 6.6 years, 7.7 years, and 6.6 years, respectively.

Minimum rental amounts due under tenant leases are generally subject either to scheduled fixed increases or adjustments. The following table presents approximate future minimum rental income under non-cancelable operating leases, excluding variable lease revenue of tenant reimbursements, to be received over the next five years and thereafter as of September 30, 2026 and excludes leases at the Company's multifamily properties as they are short term, generally 12 months or less (dollars in thousands):