9. Real Estate

As part of its build-to-suit development initiatives, MBTS purchases certain land parcels. Contemporaneously with the land purchases, MBTS enters into commercial lease agreements, as a lessor, in respect to the land parcels and build-to-suit improvements to be constructed thereon. The leases commence upon substantial completion of the build-to-suit developments. The Company intends to sell the land and improvements with the attached leases at, or subsequent to, the respective lease commencement date.

In December 2024, a development was completed and the lease commenced. In September 2025, the Company completed the sale of this property for consideration totaling $7.0 million. In March 2026, another development was completed and the lease commenced. In June 2026, the Company completed the sale of this property for consideration totaling $7.3 million. This property sale was to Monomoy Properties REIT, LLC a related party. Upon completion of each development, the Company began to depreciate the asset over the expected useful life of 39 years. During the three months ended September 30, 2025, the Company recognized depreciation expense totaling approximately $28 thousand in connection with the asset. For the three months ended September 30, 2025, lease income relating to lease payments was $0.1 million.

There was $27 thousand of lease income relating to lease payments for the three months ended September 30, 2026 related to an additional asset.

During the three months ended September 30, 2026 and September 30, 2025, the Company capitalized costs of $6.6 million and $1.9 million, respectively, within real estate assets, net on its condensed consolidated balance sheet, representing the development and construction costs directly identifiable with the real estate projects.