Related Party Transactions |
9 Months Ended |
|---|---|
Sep. 30, 2026 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions | Related Party Transactions Management Fee Income On May 5, 2025, REAC entered into amendments to the management agreements (as amended, the “Amended Management Agreements”) pursuant to which the Company provides property management services to certain properties, owned by family members and affiliates of Mr. Spodek. An additional property for which REAC provides management services to affiliates of Mr. Spodek was not amended by the Amended Management Agreements. As of September 30, 2026, the Company provides property management services for 250 postal properties which are owned by family members and affiliates of Mr. Spodek. The Amended Management Agreements provide that, as of April 1, 2025, the initial management fee to be received by REAC is equal to 4.0% per annum of each property’s gross revenue, payable quarterly. Each successive April 1, the management fee will be increased to 102.5% of the management fee previously in effect. The initial term of the Amended Management Agreements is through March 31, 2030 (the “Initial Term”), unless terminated earlier. After the Initial Term, the Amended Management Agreements will be automatically renewed for successive one-year terms, unless either party provides 30 days' advance notice of non-renewal. Furthermore, beginning October 1, 2025, the Amended Management Agreements may be terminated by either party at any time upon 60 days’ notice to the other party. The Amended Management Agreements also provide that, to the extent REAC provides services in connection with the financing of managed properties, REAC shall be entitled to an additional $5,000 fee per property being financed, whether such properties are financed individually, as part of a portfolio or pooled, provided that the total fees payable shall not exceed $50,000 per financing transaction. The Amended Management Agreements were unanimously approved by an independent Special Committee of the Company's Board of Directors consisting of all members of the Board of Directors other than Mr. Spodek (the “Special Committee”). REAC recognized management fee income of $0.2 million and $0.6 million for the three and nine months ended September 30, 2026, respectively, and $0.2 million and $0.8 million for the three and nine months ended September 30, 2025, respectively, from various parties which were affiliated with the Company's CEO. These amounts are included in “Fee and other” in the Consolidated Statements of Operations and Comprehensive Income. Accrued management fees receivable of $0.2 million as of September 30, 2026 and December 31, 2025, are included in “Rent and other receivables” on the Consolidated Balance Sheets. Related Party Lease In connection with the Company’s IPO and the related formation transactions, the Company entered into a lease for office space in Cedarhurst, NY with an entity affiliated with the Company’s CEO (the “Prior Office Lease”). Pursuant to the Prior Office Lease, the monthly rent was $15,000 subject to escalations. The term of the Prior Office Lease was five years commencing on May 17, 2019 and expired on May 16, 2024. In May 2024, the Prior Office Lease was extended to December 31, 2024 at the same rental rate. In December 2024, the Company entered into a new lease with an entity affiliated with the Company’s CEO (the “2025 Office Lease,” and, collectively with the Prior Office Lease, the “Office Leases”). Pursuant to the 2025 Office Lease, the monthly rent is $18,750 subject to escalations. The term of the 2025 Office Lease is five years commencing on January 1, 2025 and will expire on December 31, 2029. The 2025 Office Lease was unanimously approved by the Special Committee. Rental expenses associated with the Office Leases for the three and nine months ended September 30, 2026 and 2025 were $0.06 million and $0.2 million, respectively, and was recorded in “General and administrative expenses” in the Consolidated Statements of Operations and Comprehensive Income. The Company determined the Office Leases were operating leases. For further details, see Note 7. Leases. Right of First Offer Transactions In connection with the Company’s initial public offering (the “IPO”) and related formation transactions, the Company entered into a Right of First Offer Agreement (the “ROFO Agreement”) with certain members of the family (the “Related Party”) of Andrew Spodek, the Company’s Chief Executive Officer. Pursuant to the ROFO Agreement, the Company has a right of first offer to acquire up to 250 properties currently managed by the Company from the Related Party. On May 30, 2024, the Company acquired from the Related Party a portfolio of 36 properties currently leased to the USPS for approximately $12.5 million in cash, excluding closing costs (the "2024 ROFO Transaction"). On December 9, 2025, the Company acquired from the Related Party a portfolio of 25 properties leased to the USPS for approximately $13.9 million in cash, excluding closing costs (the “2025 ROFO Transaction”). Effective March 16, 2026, the Company acquired from the Related Party an additional portfolio of 12 properties leased to the USPS for approximately $11.5 million in cash, excluding closing costs (together with each of the 2024 ROFO Transaction and the 2025 ROFO Transaction, the “ROFO Transactions”). In addition, effective September 4, 2026, the Company acquired from certain entities which were either directly or indirectly fifty percent beneficially owned by the Related Party (such transaction, the “2026 Related Party Transaction”), a portfolio of 72 properties currently leased to the USPS for approximately (i) $25.75 million in cash (the “2026 Related Party Cash Consideration”) and (ii) $2.0 million of Operating Partnership Units (the “2026 Related Party OP Unit Consideration”) of the Operating Partnership, excluding closing costs and adjustments. In connection with the 2026 Related Party Transaction, the Related Party received, either directly or indirectly, approximately $11.88 million of the 2026 Related Party Cash Consideration and all of the 2026 Related Party OP Unit Consideration. Based on the 10-trading day volume-weighted average price of the Company's Class A common stock immediately prior to the effective date of the 2026 Related Party Transaction of $23.4465, 85,300 OP Units were provided to the Related Party in satisfaction of the 2026 Related Party OP Unit Consideration. The Company’s entry into each of the ROFO Transactions and the 2026 Related Party Transaction was approved by the Special Committee. As of September 30, 2026, the Company retained a right of first offer to acquire 177 of the 250 postal properties it manages. Guarantees As disclosed above in Note 5. Debt, Mr. Spodek personally guaranteed a portion of or the entire amount outstanding under the Company's loans with First Oklahoma Bank and Vision Bank, totaling $1.8 million as of September 30, 2026 and December 31, 2025. As a guarantor, Mr. Spodek's interests with respect to the amount of debt he is guaranteeing (and the terms of any repayment or default) may not align with the Company’s interests and could result in a conflict of interest.
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