ONE LIBERTY PROPERTIES INC

NOTE 1 — ORGANIZATION AND BACKGROUND

One Liberty Properties, Inc. (“OLP”) was incorporated in 1982 in Maryland. OLP is a self-administered and self-managed real estate investment trust (“REIT”). OLP acquires, owns and manages a geographically diversified portfolio consisting primarily of industrial properties. As of December 31, 2025, OLP owns 103 properties, including a property owned by a consolidated joint venture. The 103 properties are located in 30 states.

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts and operations of OLP, its wholly owned subsidiaries, its joint ventures in which the Company, as defined, has a controlling interest, and variable interest entities (“VIEs”) of which the Company is the primary beneficiary. OLP and its consolidated subsidiaries are referred to herein as the “Company”. Material intercompany items and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Management believes that the estimates and assumptions that are most important to the portrayal of the Company’s consolidated financial condition and results of operations, in that they require management’s most difficult, subjective or complex judgments, form the basis of the accounting policies deemed to be most significant to the Company. These significant accounting policies relate to revenues and the value of the Company’s real estate portfolio, including investments in unconsolidated joint ventures. Management believes its estimates and assumptions related to these significant accounting policies are appropriate under the circumstances; however, should future events or occurrences result in unanticipated consequences, there could be a material impact on the Company’s future consolidated financial condition or results of operations.

Revenue Recognition

Rental income includes the base rent that each tenant is required to pay in accordance with the terms of its lease reported over the non-cancelable term of the lease on a straight-line basis, if collectability is probable. On a quarterly basis, management reviews the tenant’s payment history and financial condition in determining, in its judgment, whether any accrued rental income and unbilled rent receivable balances applicable to a specific tenant is collectable. Any change to the collectability of lease payments or unbilled rent receivables is recognized as a current period adjustment to rental revenue (see Note 3).

Some leases provide for increases based on the Consumer Price Index or for additional contingent rental revenue in the form of percentage rents. The percentage rents are based upon the level of sales achieved by the lessee and are recognized once the required sales levels are reached. Some leases provide for an incentive for the lessee to sign a lease, such as a leasehold improvement allowance in which the Company reimburses the tenant for the construction of lessee assets. Such lease incentives are capitalized at lease commencement and recognized on a straight-line basis over the lease term as a reduction to rental income.

Many of the Company’s properties are subject to long-term net leases under which the tenant is typically responsible to pay directly to the vendor the real estate taxes, insurance, utilities and ordinary maintenance and repairs related to the property, and the Company is not the primary obligor with respect to such items. As a result, the revenue and expenses relating to these properties are recorded on a net basis. For certain properties, in addition to contractual base rent, the tenants pay their contractual share of real estate taxes and operating expenses to the Company. The revenue and expenses associated with properties at which the Company is the primary obligor are generally recorded on a gross basis. During 2025, 2024 and 2023, the Company recorded reimbursements of expenses of$16,635,000, $14,793,000 and $13,636,000, respectively, which are included in Rental income, net, in the accompanying consolidated statements of income.

Gains and losses on the sale of real estate investments are recorded when the Company no longer holds a controlling financial interest in the entity which holds the real estate investment and the relevant revenue recognition criteria under GAAP have been met.

Purchase Accounting for the Acquisition of Real Estate

In acquiring real estate, the Company evaluates whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, and if that requirement is met, the asset group is accounted for as an asset acquisition and not a business combination. Transaction costs incurred with such asset acquisitions are capitalized to real estate assets and depreciated over the respectful useful lives.

The Company allocates the purchase price of real estate, including direct transaction costs applicable to an asset acquisition, among land, building, improvements and intangibles (e.g., the value of above, below and at-market leases, origination costs associated with in-place leases and above or below-market mortgages assumed at the acquisition date). The value, as determined, is allocated to the gross assets acquired based on management’s determination of the relative fair values of these assets and liabilities.

The Company assesses the fair value of the gross assets acquired based on available market information which utilize estimated cash flow projections; such inputs are categorized as Level 3 inputs in the fair value hierarchy. In determining fair value, factors considered by management include an evaluation of current market demand, market capitalization rates and discount rates, estimates of carrying costs (e.g., real estate taxes, insurance and other operating expenses), and lost rental revenue during the expected lease-up periods. Management also estimates costs to execute similar leases, including leasing commissions and tenant improvements.

The values of acquired above-market and below-market leases are recorded based on the present values (using discount rates which reflect the risks associated with the leases acquired) of the difference between the contractual amounts to be received and management’s estimate of market lease rates, measured over the terms of the respective leases that management deemed appropriate at the time of the acquisition. Such valuations include a consideration of the non-cancellable terms of the respective leases, as well as any applicable renewal period(s). The fair values associated with below-market rental renewal options are determined based on the Company’s experience and other relevant factors at the time of the acquisition. The values of above-market leases are amortized as a reduction to rental income over the terms of the respective non-cancellable lease periods. The values of below-market leases are amortized as an increase to rental income over the terms of the respective non-cancellable lease periods. The portion of the values of the leases associated with below-market renewal options that management deemed are reasonably certain to be exercised by the tenant are amortized to rental income over such renewal periods. The value of other intangible assets (i.e., origination costs) is recorded to amortization expense over the remaining term of the respective leases. If a lease is terminated prior to its contractual expiration date or not renewed, all unamortized amounts relating to that lease are recognized in operations at such time. The estimated remaining useful lives of intangibles assets or liabilities range from approximately less thanone year to 21 years.

The values of assumed mortgages are recorded based on the present values (using discount rates which reflect the risks associated with the mortgage assumed) of the difference between the contractual amounts to be paid at the stated interest rates and management’s estimate of market interest rates for similar debt, at the time of the acquisition, measured over the term of such debt. The values of above or below-market mortgages are amortized as a decrease or increase, respectively, to interest expense over the term of the respective debt. The estimated remaining useful lives of intangible mortgage assets range from approximately three tofour years.

Accounting for Long-Lived Assets and Impairment of Real Estate Owned

The Company reviews its real estate portfolio on a quarterly basis for indicators of impairment to the value of any of its real estate assets, including deferred costs and intangibles, to determine if there is any need for an impairment charge. In reviewing the portfolio, the Company examines one or more of the following: the type of asset, the current financial statements or other available financial information of the tenant, prolonged or significant vacancies, the economic environment of the area in which the asset is located and the industry in which the tenant is involved, the timeliness of the payments made by the tenant under its lease, property inspection reports and communication with, by, or relating to, the tenant. For each real estate asset owned for which indicators of impairment exist, management performs a recoverability test by comparing (i) the sum of the estimated undiscounted future cash flows attributable to the asset, which are determined using assumptions and estimates, including projected rental rates over an appropriate holding period and property capitalization rates, to (ii) the carrying amount of the asset. If the aggregate undiscounted cash flows are less than the asset’s carrying amount, an impairment is recorded to the extent that the estimated fair value is less than the asset’s carrying amount. The estimated fair value is determined using a discounted cash flow model of the expected future cash flows through the useful life of the property. The analysis includes an estimate of the future cash flows that are expected to result from the real estate investment’s use and eventual disposition. These cash flows consider factors such as expected future operating income, trends and prospects, the effects of leasing demand, competition and other factors. Real estate assets that are expected to be disposed of are valued at the lower of carrying amount or fair value less costs to sell on an individual asset basis.

Properties Held-for-Sale

Real estate investments are classified as properties held-for-sale when management determines that the investment meets the applicable criteria. Real estate assets that are classified as held-for-sale are: (i) valued at the lower of carrying amount or the estimated fair value less costs to sell on an individual asset basis; and (ii) not depreciated.

Investment in Joint Ventures and Variable Interest Entities

The Financial Accounting Standards Board, or FASB, provides guidance for determining whether an entity is a VIE. VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. A VIE is required to be consolidated by its primary beneficiary, which is the party that (i) has the power to control the activities that most significantly impact the VIE’s economic performance and (ii) has the obligation to absorb losses, or the right to receive benefits, of the VIE that could potentially be significant to the VIE.

The Company assesses the accounting treatment for each of its investments, including a review of each venture or limited liability company or partnership agreement, to determine the rights of each party and whether

those rights are protective or participating. The agreements typically contain certain protective rights, such as the requirement of partner approval to sell, finance or refinance the property and to pay capital expenditures and operating expenditures outside of the approved budget or operating plan. In situations where, among other things, the Company and its partners jointly (i) approve the annual budget, (ii) approve certain expenditures, (iii) prepare or review and approve the joint venture’s tax return before filing, or (iv) approve each lease at a property, the Company does not consolidate as the Company considers these to be substantive participation rights that result in shared, joint power over the activities that most significantly impact the performance of the joint venture or property. Additionally, the Company assesses the accounting treatment for any interest pursuant to which the Company may have a variable interest as a lessor. Leases may contain certain protective rights, such as the right of sale and the receipt of certain escrow deposits.

Distributions to each joint venture partner are determined pursuant to the applicable operating agreement and, in the event of a sale of, or refinancing of the mortgage encumbering the property owned by such venture, the distributions to the Company may be less than that implied by the Company’s equity ownership interest in the venture.

As of December 31, 2025, the Company has sold all the properties it held through unconsolidated joint ventures. The Company accounted for its investments in unconsolidated joint ventures under the equity method of accounting. The investments in unconsolidated joint ventures had sufficient equity at risk to permit the entity to finance its activities without additional subordinated financial support and, as a group, the holders of the equity at risk had power through voting rights to direct the activities of these ventures. As a result, none of these joint ventures were VIEs. In addition, the Company shared power with its co-managing members over these entities, and therefore the entities were not consolidated. These investments were recorded initially at cost, as investments in unconsolidated joint ventures, and subsequently adjusted for their share of equity in earnings, cash contributions and distributions. None of the joint venture debt was recourse to the Company, subject to standard carve-outs.

The Company has elected to follow the cumulative earnings approach when assessing, for the consolidated statement of cash flows, whether the distribution from the investee is a return of the investor’s investment as compared to a return on its investment. The source of the cash generated by the investee to fund the distribution is not a factor in the analysis (that is, it does not matter whether the cash was generated through investee refinancing, sale of assets or operating results). Consequently, the investor only considers the relationship

between the cash received from the investee to its equity in the undistributed earnings of the investee, on a cumulative basis, in assessing whether the distribution from the investee is a return on or a return of its investment. Cash received from the unconsolidated entity is presumed to be a return on the investment to the extent that, on a cumulative basis, distributions received by the investor are less than its share of the equity in the undistributed earnings of the entity.

Fair Value Measurements

The Company measures the fair value of financial instruments based on the assumptions that market participants would use in pricing the asset or liability. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). As a basis for considering market participant assumptions in fair value measurements, a fair value hierarchy distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity and the reporting entity’s own assumptions about market participant assumptions. In accordance with the fair value hierarchy, Level 1 assets/liabilities are valued based on quoted prices for identical instruments in active markets, Level 2 assets/liabilities are valued based on quoted prices in active markets for similar instruments, on quoted prices in less active or inactive markets, or on other “observable” market inputs and Level 3 assets/liabilities are valued based on significant “unobservable” market inputs.

Derivatives and Hedging Activities

The Company uses interest rate swaps to add stability to interest expense; not for trading or speculative purposes.

The Company records all derivatives on the consolidated balance sheets at fair value using widely accepted valuation techniques including a discounted cash flow analysis on the expected cash flows of the derivatives. In addition, the Company incorporates credit valuation adjustments to appropriately reflect both its own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. These counterparties are generally large financial institutions engaged in providing a variety of financial services. These institutions generally face similar risks regarding adverse changes in market and economic conditions including, but not limited to, fluctuations in interest rates, exchange rates, equity and commodity prices and credit spreads.

The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows are considered cash flow hedges. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in accumulated other comprehensive income (outside of earnings) and subsequently reclassified to earnings in the period in which the hedged transaction becomes ineffective. For derivatives not designated as cash flow hedges, changes in the fair value of the derivative are recognized directly in earnings in the period in which the change occurs; however, the Company’s policy is to not enter into such transactions.

Stock Based Compensation

The fair value of restricted stock grants and restricted stock units (“RSUs”), determined as of the date of grant, is amortized into general and administrative expense over the respective vesting period. The deferred compensation to be recognized as expense is net of forfeitures. The Company recognizes the effect of forfeitures when they occur and previously recognized compensation expense is reversed in the period the grant or unit is forfeited. For share-based awards with a performance or market measure, the Company recognizes compensation expense over the requisite service period and the performance assumptions are re-evaluated quarterly. The requisite service period begins on the date the Compensation Committee of the Company’s Board of Directors authorizes the award, adopts any relevant performance measures and communicates the award to the recipient.

Income Taxes

The Company is qualified as a REIT under the applicable provisions of the Internal Revenue Code. Under these provisions, the Company will not be subject to Federal, and generally, state and local income taxes, on amounts distributed to stockholders, provided it distributes at least 90% of its ordinary taxable income and meets certain other conditions.

The Company follows a two-step approach for evaluating uncertain tax positions. Recognition (step one) occurs when an enterprise concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustained upon examination. Measurement (step two) determines the amount of benefit that more-likely-than-not will be realized upon settlement. Derecognition of a tax position that was previously recognized would occur when a company subsequently determines that a tax position no longer meets the more-likely-than-** **not threshold of being sustained. The use of a valuation allowance as a substitute for derecognition of tax positions is prohibited. The Company has not identified any uncertain tax positions requiring accrual.

• *Cash and Cash Equivalents

All highly liquid investments with original maturities of three months or less when purchased are considered to be cash equivalents.

Concentration of Credit Risk

The Company maintains cash accounts at various financial institutions. While the Company attempts to limit any financial exposure, some of its deposit balances exceed federally insured limits. The Company has not experienced any losses on such accounts.

The Company’s properties are located in 30 states. South Carolina is the only state in which the Company’s properties contributed more than 10% to total revenues (i.e.,11.8% in 2025,11.6% in 2024 and 10.3% in 2023).

No tenant contributed over 10% to the Company’s total revenues in any of the past three years.

Escrows

Real estate taxes and other escrows aggregating $650,000 and $3,166,000 at December 31, 2025 and 2024, respectively, are included in Escrow, deposits and other assets and receivables.

Segment Reporting

Substantially all of the Company’s real estate assets, at acquisition, are comprised of real estate owned that is leased to tenants on a long-term basis. Therefore, the Company aggregates real estate assets for reporting purposes and operates inone reportable segment.

The Company’s Chief Operating Decision Makers (“CODMs”) are its Chief Executive Officer and Chief Operating Officer. As the Company operates inone reportable segment, the CODMs are provided the consolidated income statement (detailing total revenues, total operating expenses, operating income and net income). This financial report assists the CODMs in assessing the Company’s financial performance and in allocating resources appropriately.

New Accounting Pronouncement

In November 2024, the FASB issued ASU No. 2024*–03,Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220–40): Disaggregation of Income Statement Expenses, which requires disaggregated disclosure of income statement expenses into specified categories within the footnotes to the financial statements. ASU No. 2024–*03 is applicable for fiscal years beginning after December 15, 2026. The Company is in the process of evaluating the new guidance to determine the extent to which it will impact the Company’s consolidated financial statements.

NOTE 3 — LEASES

Lessor Accounting

The Company owns rental properties which are leased to tenants under operating leases with current expirations ranging from 2026 to 2042, with options toextend orterminate the lease. Revenues from such leases are reported as Rental income, net, and are comprised of (i) lease components, which includes fixed and variable lease payments and (ii) non-lease components which includes reimbursements of property level operating expenses. The Company doesnot separate non-lease components from the related lease components, as the timing and pattern of transfer are the same, and account for the combined component in accordance with ASC 842.

Fixed lease revenues represent the base rent that each tenant is required to pay in accordance with the terms of its respective lease, and any lease incentives paid or payable to the lessee, reported on a straight-line basis over the non-cancelable term of the lease. Variable lease revenues typically include payments based on (i) tenant reimbursements, (ii) changes in the index or market-based indices after the inception of the lease and (iii) percentage rents. Variable lease revenues are not recognized until the specific events that trigger the variable payments have occurred.

The components of lease revenues are as follows (amounts in thousands):

In many of the Company’s leases, the tenant is obligated to pay the real estate taxes, insurance, and certain other expenses directly to the vendor. These obligations, which have been assumed by the tenants, are not reflected in the Company’s consolidated financial statements. To the extent any such tenant defaults on its lease or if it is deemed probable that the tenant will fail to pay for such obligations, a liability for such obligations would be recorded.

On a quarterly basis, the Company assesses the collectability of substantially all lease payments due by reviewing the tenant’s payment history or financial condition. Changes to collectability are recognized as a current period adjustment to rental revenue. As of December 31, 2025, the Company has assessed the collectability of all recorded lease revenues as probable.

NOTE 3 — LEASES (CONTINUED)

Minimum Future Rents

As of December 31, 2025, the minimum future contractual rents to be received on non-cancellable operating leases are included in the table below (amounts in thousands). The minimum future contractual rents do not include (i) straight-line rent or amortization of lease intangibles or incentives and (ii) variable lease payments as previously described.

Straight-Line Rent

At December 31, 2025 and 2024, the Company’s unbilled rent receivables aggregating $17,269,000 and $16,988,000, respectively, represent rent reported on a straight-line basis in excess of rental payments required under the respective leases. The unbilled rent receivable is to be billed and received pursuant to the lease terms during the next 16 years.

During 2025, 2024 and 2023, the Company wrote-off $1,260,000, $1,045,000 and $1,048,000, respectively, of unbilled straight-line rent receivable related to the properties sold during such years, which reduced the gain on sale reported on the consolidated statements of income.

At December 31, 2025 and 2024, the Company’s unearned rental income aggregating $283,000 and $416,000, respectively, represent rent reported on a straight-line basis less than rental payments required under the respective leases. Such amounts are recorded in Accrued expenses and other liabilities on the consolidated balance sheets. The unearned rental income is to be recognized into revenue over the term of the lease during the next 16 years. During 2023, the Company wrote-off$43,000 of a tenant’s unearned rental income as the related property was sold during such year, which increased the gain on sale reported on the consolidated statement of income. No such amounts were written off during 2025 or 2024.

On a quarterly basis, the Company assesses the collectability of straight-line rent balances by reviewing the tenant’s payment history and financial condition. The Company has assessed the collectability of all straight-line rent balances as probable as of December 31, 2025. During 2024 and 2023, the Company wrote-off, as a reduction to rental income, net,$50,000 and $133,000, respectively, of unbilled rent receivables due from two tenants as they filed for Chapter 11 bankruptcy protection.

Lease Incentives

At December 31, 2025 and 2024, the Company’s unamortized lease incentives aggregating $708,000 and $975,000, respectively, are recorded in Escrow, deposits and other assets and receivables on the consolidated balance sheets. During 2025 and 2024, the Company amortized $107,000 and $119,000, respectively, of such incentives as a reduction to rental income. During 2025 and 2023, the Company wrote-off $160,000 and $84,000, respectively, related to two tenants’ unamortized lease incentive balances as the properties were sold, which reduced the gain on sale reported on the consolidated statements of income during such years. No such amounts were written off during 2024. The unamortized lease incentive balance will be amortized against rental income through 2033.

NOTE 3 — LEASES (CONTINUED)

Lessee Accounting

Ground Lease

The Company is a lessee under a ground lease in Greensboro, North Carolina, which is classified as an operating lease. The ground lease expires March 3, 2030 and provides for up tothree, five-year renewal options andone seven-month renewal option. At December 31, 2025 and 2024, the Company recorded a liability of $2,105,000 and $2,511,000, respectively, for the obligation to make payments under the lease and an asset of $1,638,000 and $1,953,000, respectively, for the right to use the underlying asset during the lease term. The liability is included in Accrued expenses and other liabilities and the asset is included in Escrow, deposits and other assets and receivables on the consolidated balance sheets. As of December 31, 2025, the remaining lease term is approximately four years. The Company applied a discount rate of 6.91%, based on its incremental borrowing rate given the term of the lease, as the rate implicit in the lease is not known. During the years ended December 31, 2025, 2024 and 2023, the Company recognized$489,000, $489,000 and $544,000, respectively, of lease expense related to this ground lease which is included in Real estate expenses on the consolidated statements of income.

Office Lease

The Company is a lessee under a corporate office lease in Great Neck, New York, which is classified as an operating lease. The lease expires on December 31, 2031 and provides afive-year renewal option. At December 31, 2025 and 2024, the Company recorded a liability of$484,000 and $511,000, respectively, for the obligation to make payments under the lease and an asset of $442,000 and $473,000, respectively, for the right to use the underlying asset during the lease term. The liability is included in Accrued expenses and other liabilities and the asset is included in Escrow, deposits and other assets and receivables on the consolidated balance sheets. Lease payments associated with the renewal option period, which was determined to be reasonably certain to be exercised, are included in the measurement of the lease liability and right of use asset. As of December 31, 2025, the remaining lease term, including the renewal option deemed exercised, is 11 years. The Company applied a discount rate of 3.81%, based on its incremental borrowing rate given the term of the lease, as the rate implicit in the lease is not known. During each of the years ended December 31, 2025, 2024 and 2023, the Company recognized$56,000 of lease expense related to this office lease which is included in General and administrative expenses on the consolidated statements of income.

Minimum Future Lease Payments

As of December 31, 2025, the minimum future lease payments related to the operating ground and office leases are as follows (amounts in thousands):

NOTE 4 — REAL ESTATE INVESTMENTS

Acquisitions

The following tables detail the Company’s real estate asset acquisitions and purchase price allocations during 2025 and 2024 (amounts in thousands):

NOTE 4 — REAL ESTATE INVESTMENTS (CONTINUED)

** **The following tables detail the (i) accumulated amortization and (ii) annual amortization and classification in the Company’s consolidated statements of income of acquired intangibles for the periods indicated (amounts in thousands):

As of December 31, 2025, the future amortization of the Company’s acquired intangibles are as follows (amounts in thousands):

Acquisitions subsequent to December 31, 2025

On January 29, 2026, the Company acquired a 637,633 square foot portfolio comprised often industrial properties for$56,700,000, including new mortgage debt of approximately$17,002,000 bearing an interest rate of 5.53% and maturing in 2033 and$30,000,000 borrowed on the Company’s credit facility. Simultaneously, the Company signed a contract to purchase from the same buyer an additional 14 acres of land for$800,000 adjacent to one of the properties in this portfolio.

Depreciation and Amortization

Depreciation of buildings is computed on the straight-line method over an estimated useful life of 40 years. Depreciation of building improvements is computed on the straight-line method over the estimated useful life of the improvements. If the Company determines it is the owner of tenant improvements, the amounts funded to construct the tenant improvements are treated as a capital asset and depreciated over the lesser of the remaining lease term or the estimated useful life of the improvements on the straight-line method. Leasehold interests and the related ground lease payments are amortized over the initial lease term of the leasehold position. During 2025, 2024 and 2023, the Company recorded depreciation expense (including amortization of a leasehold position, lease origination costs, and capitalized leasing commissions) of $27,196,000, $24,291,000 and $24,789,000, respectively.

NOTE 5 — SALES OF PROPERTIES AND IMPAIRMENT LOSSES

Sales of Properties

The following tables detail the Company’s sales of real estate during 2025, 2024 and 2023 (amounts in thousands):

NOTE 5 — SALES OF PROPERTIES AND IMPAIRMENT LOSSES (CONTINUED)

Impairment Losses

During 2025 and 2024, the Company recognized impairment losses of $4,593,000 and $1,086,000, respectively, on the consolidated statements of income.

In 2025, the Company recognized impairment losses of (i) $3,293,000 at its St. Louis Park, Minnesota property as it reduced the carrying value of the assets to its estimated fair value using a market approach based on an estimated sales price from a non-binding letter of intent; the adjusted net book value of this property was $10,000,000 at December 31, 2025, and (ii) $1,300,000 at its Beachwood, Ohio property as it reduced the carrying value of the assets to its estimated fair value based on the estimated net sales price from an executed contract of sale; the property was sold in November 2025.

In 2024, the Company recognized a $1,086,000 impairment loss at its Hamilton, Ohio property as it reduced the carrying value of the assets to its estimated fair value based on the estimated net sales price from an executed contract of sale. This property was sold in August 2024.

The fair value for each of these impairments were determined using Level 3 unobservable inputs within the fair value hierarchy (as discussed in Note 2).

Sales subsequent to December 31, 2025

In October 2025, the Company entered into a contract to sell a vacant retail property located in Cary, North Carolina for $6,000,000. The buyer’s right to terminate the contract without penalty expired on February 2, 2026. It is anticipated the (i) property will be sold in March 2026 and (ii) sale will result in a gain of approximately $2,500,000, which will be recognized as Gain on sale of real estate, net, in the consolidated statement of income for the quarter ending March 31, 2026.

In January 2026, the Company entered into a contract to sell a retail property located in Newport News, Virginia for $4,200,000. The buyer’s right to terminate the contract without penalty expired on March 2, 2026. It is anticipated the (i) property will be sold in April 2026 and (ii) sale will result in a gain of approximately $1,300,000, which will be recognized as Gain on sale of real estate, net, in the consolidated statements of income for the three and six months ending June 30, 2026.

NOTE 6 — VARIABLE INTEREST ENTITIES AND CONSOLIDATED JOINT VENTURES

As of December 31, 2025, the Company hasone consolidated joint venture in which it holds a 95% interest. The Company has determined (i) this joint venture is a VIE because the non-controlling interest does not hold substantive kick-out or participating rights and (ii) it is the primary beneficiary of this VIE as it has the power to direct the activities that most significantly impact the joint venture’s performance including management, approval of expenditures, and the obligation to absorb the losses or rights to receive benefits. Accordingly, the Company consolidates the operations of this VIE for financial statement purposes. The VIE’s creditors do not have recourse to the assets of the Company other than those held by the joint venture.

The following is a summary of the consolidated VIEs’ carrying amounts and classification in the Company’s consolidated balance sheets, none of which are restricted (amounts in thousands):

NOTE 7 — INVESTMENT IN UNCONSOLIDATED JOINT VENTURES

As of December 31, 2025, the Company no longer operates any properties through unconsolidated joint ventures.

In August 2025, the Company and its joint venture partners sold the last two remaining unconsolidated joint venture properties in Savannah, Georgia for an aggregate of $4,614,000, net of closing costs. The Company’s 50% share of the gain from these sales was $991,000, which is recorded as Equity in earnings (loss) from sale of unconsolidated joint venture properties on the consolidated statement of income for year ended December 31, 2025. As of December 31, 2025 and 2024, the Company’s balances from its equity investments were$203,000 and $2,101,000, respectively.

The Company recorded equity in earnings of $101,000 and $143,000 during 2025 and 2024, respectively, and equity in loss of $904,000 during 2023. Included in equity in loss for 2023 was the Company’s 50% share of an impairment charge, or $850,000, related to its former Manahawkin, New Jersey joint venture property which was sold in December 2023. The Company’s 50% share of the loss from this sale was $108,000, which is included in Equity in earnings (loss) from sale of unconsolidated joint venture properties on the consolidated statement of income for the year ended December 31, 2023.

NOTE 8 — DEBT OBLIGATIONS

Mortgages Payable

The following table details the Mortgages payable, net, balances per the consolidated balance sheets (amounts in thousands):

At December 31, 2025, there were 61 outstanding mortgages payable, all of which are secured by first liens on individual real estate investments with an aggregate gross carrying value of $805,750,000 before accumulated depreciation of $136,446,000. After giving effect to interest rate swap agreements (see Note 9), the mortgage payments bear interest at fixed rates ranging from 3.05% to 6.42% and mature between 2026 and 2047. The weighted average interest rate on all mortgage debt was 4.88%,4.56% and 4.31% at December 31, 2025, 2024 and 2023, respectively.

Scheduled principal repayments during the years indicated are as follows (amounts in thousands):

Line of Credit

The Company’s credit facility with Manufacturers and Traders Trust Company and VNB New York, LLC, provides that it may borrow up to $100,000,000, subject to borrowing base requirements. The facility is available for the acquisition of commercial real estate, repayment of mortgage debt, and renovation and operating expense purposes; provided, that if used for renovation and operating expense purposes, the amount outstanding for such purposes will not exceed the lesser of $40,000,000 and 40% of the borrowing base. Net proceeds received from the sale, financing or refinancing of properties are generally required to be used to repay amounts outstanding under the credit facility. The facility is guaranteed by subsidiaries of the Company that own unencumbered properties and the Company is required to pledge to the lenders the equity interests in such subsidiaries.

The credit facility includes certain restrictions and covenants which may limit, among other things, the incurrence of liens, and which require compliance with financial ratios relating to, among other things, the minimum amount of tangible net worth, the minimum amount of debt service coverage, the minimum amount of fixed charge coverage, the maximum amount of debt to value, the minimum level of net income, certain investment limitations and the minimum value of unencumbered properties and the number of such properties.

At December 31, 2025 and 2024, the Company hasno balance outstanding on the facility and was in compliance with all covenants.

NOTE 8 — DEBT OBLIGATIONS (CONTINUED)

The facility, which matures December 31, 2026, provides for an interest rate equal to 30-day SOFR plus an applicable margin ranging from 175 basis points to 275 basis points depending on the ratio of the Company’s total debt to total value, as determined pursuant to the facility. The applicable margin was 175 basis points at December 31, 2025 and 2024. An unused facility fee of.25% per annum applies to the facility. The weighted average interest rate on the facility was approximately 6.07% and 6.69% during 2025 and 2023. The Company hadno balance outstanding on the facility during the year ended December 31, 2024.

At December 31, 2025 and February 27, 2026, $100,000,000 and $70,000,000, respectively, was available to be borrowed under the facility, including an aggregate of up to $40,000,000 available for renovation and operating expense purposes at each of such dates.

At December 31, 2025 and 2024, the Company had unamortized deferred financing costs of $183,000 and $366,000, respectively, which are included in Escrow, deposits and other assets and receivables on the consolidated balance sheets.

Deferred Financing Costs

Mortgage and credit line costs are deferred and amortized on a straight-line basis over the terms of the respective debt obligations, which approximates the effective interest method. At December 31, 2025 and 2024, accumulated amortization of such costs was $5,473,000 and $5,214,000, respectively.

NOTE 9 — FAIR VALUE MEASUREMENTS

The carrying amounts of cash and cash equivalents, escrow, deposits and other assets and receivables (excluding interest rate swaps), dividends payable, and accrued expenses and other liabilities, are not measured at fair value on a recurring basis but are considered to be recorded at amounts that approximate fair value.

The fair value and carrying amounts of the Company’s mortgages payable are as follows (dollars in thousands):

Considerable judgment is necessary to interpret market data and develop the estimated fair value. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

NOTE 9 — FAIR VALUE MEASUREMENTS (CONTINUED)

Fair Value on a Recurring Basis

As of December 31, 2025, the Company had in effecttwo interest rate derivatives, both of which were interest rate swaps, related totwo outstanding mortgage loans with an aggregate $1,637,000 notional amount. These interest rate swaps, both of which (i) were designated as cash flow hedges, converting SOFR based variable rate mortgages to fixed annual rate mortgages, (ii) mature in July 2026 and (iii) have an interest rate of 3.24%.

Fair values are approximated using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivatives. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. Although the Company has determined the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the associated credit valuation adjustments use Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparty. As of December 31, 2025, the Company has assessed and determined the impact of the credit valuation adjustments on the overall valuation of its derivative positions is not significant. As a result, the Company determined its derivative valuation is classified in Level 2 of the fair value hierarchy. The Company does not currently own any financial instruments that are measured on a recurring basis and that are classified as Level 1 or 3.

At December 31, 2025 and 2024, the carrying and fair value of the Company’s derivative financial instruments was $16,000 and $208,000, respectively. The fair value of the Company’s derivatives is reflected in Escrow, deposits and other assets and receivables on the consolidated balance sheets. At December 31, 2025 and 2024, there wereno derivatives in a liability position.

The following table presents the effect of the Company’s derivative financial instruments on the consolidated statements of income for the years presented (amounts in thousands):

During the twelve months ending December 31, 2025, the Company estimates an additional $16,000 will be reclassified from Accumulated other comprehensive income as a decrease to Interest expense.

The derivative agreements in effect at December 31, 2025 provide that if the wholly owned subsidiary of the Company which is a party to such agreement defaults or is capable of being declared in default on any of its indebtedness, then a default can be declared on such subsidiary’s derivative obligation. In addition, the Company is a party to the derivative agreements and if there is a default by the subsidiary on the loan subject to the derivative agreement to which the Company is a party and if there are swap breakage losses on account of the derivative being terminated early, the Company could be held liable for such swap breakage losses.

Fair Value on a Non-Recurring Basis

Non-financial assets measured at fair value on a non-recurring basis consist of three properties for which the Company recognized impairments on the consolidated statements of income of $4,593,000 and $1,086,000 for the years ended December 31, 2025 and 2024, respectively. The Company determined the estimated fair values of the assets using a market approach based on a non-binding letter of intent or executed contracts for sale which were determined to be Level 3 inputs in the fair value hierarchy (see Note 5).

NOTE 10 — STOCKHOLDERS’ EQUITY

Stock Based Compensation

The Company’s 2025, 2022 and 2019 Incentive Plans (collectively, the “Plans”), permit the Company to grant, among other things, stock options, restricted stock, RSUs, performance share awards and dividend equivalent rights and any one or more of the foregoing to its employees, officers, directors and consultants. Amaximum of 750,000 shares of the Company’s common stock were authorized for issuance pursuant to each plan at such plan’s inception.

The following details the shares subject to awards that are outstanding under the Plans as of December 31, 2025:

Restricted Stock

For accounting purposes, the restricted stock is not included in the shares shown as outstanding on the balance sheet until they vest; however, dividends are paid on the unvested shares. The restricted stock grants are charged to General and administrative expense over the respective vesting periods based on the market value of the common stock on the grant date. Generally, unless earlier forfeited because the participant’s relationship with the Company terminated, unvested restricted stock awards vest five years from the grant date, and under certain circumstances may vest earlier.

RSUs

The following table reflects the activities involving RSUs:

The Metrics and other material terms and conditions of the RSUs are as follows:

As of December 31, 2025, based on performance and market assumptions, the fair value of the RSUs granted in 2025, 2024 and 2023 is $1,409,000, $1,560,000 and $1,168,000, respectively. Recognition of such deferred compensation will be charged to General and administrative expense over the respective three-year performance cycle.

The following is a summary of the activity of the equity incentive plans:

As of December 31, 2025, total compensation costs of $7,396,000 and $2,162,000 related to non-vested restricted stock awards and RSUs, respectively, have not yet been recognized. These compensation costs will be charged to General and administrative expense over the remaining respective vesting periods. The weighted average vesting period is 2.1 years for the restricted stock and 1.5 years for the RSUs.

Common Stock Dividend

In each of 2025, 2024 and 2023, the Board of Directors declared an aggregate $1.80 per share in cash distributions.

On March 5, 2026, the Board of Directors declared a quarterly cash dividend of$0.45 per share on the Company’s common stock, totaling approximately $9,800,000. The quarterly dividend is payable on April 6, 2026 to stockholders of record on March 27, 2026.

Dividend Reinvestment Plan

The Company’s Dividend Reinvestment Plan (the “DRP”), among other things, provides stockholders with the opportunity to reinvest all or a portion of their cash dividends paid on the Company’s common stock in additional shares of its common stock, at a discount, determined in the Company’s sole discretion, of up to 5% from the market price (as such price is calculated pursuant to the DRP). The discount is currently being offered at 3%.

During 2025, 2024 and 2023, the Company issued approximately 31,000,161,000 and 233,000 shares of common stock, respectively, under the DRP.

Shares Issued through the At-the-Market Equity Offering Program

The Company did not sell any shares during 2025 and 2023. During 2024, the Company sold approximately 38,000 shares for proceeds of $1,095,000, net of commissions of $22,000, and incurred offering costs of $54,000 for professional fees.

Stock Repurchase Program

The Board of Directors authorized a repurchase program pursuant to which the Company can repurchase shares of its common stock in open-market, through privately negotiated transactions or otherwise.

No shares were repurchased by the Company during 2025 and 2024. During 2023, the Company repurchased approximately 499,000 shares of common stock, for total consideration of $9,638,000, net of commissions of $30,000. As of December 31, 2025, the Company is authorized to repurchase approximately $8,082,000 of shares of common stock.

NOTE 11 — EARNINGS PER COMMON SHARE

Basic earnings per share was determined by dividing net income allocable to common stockholders for each year by the weighted average number of shares of common stock outstanding during the applicable year. Net income is also allocated to the unvested restricted stock outstanding during each year, as the restricted stock is entitled to receive dividends and is therefore considered a participating security. As of December 31, 2025, the shares of common stock underlying the RSUs (see Note 10) are excluded from the basic earnings per share calculation, as these units are not participating securities until they vest and are issued.

Diluted earnings per share reflects the potential dilution that could occur if securities or other rights exercisable for, or convertible into, common stock were exercised or converted or otherwise resulted in the issuance of common stock that shared in the earnings of the Company.

The following table provides a reconciliation of the numerator and denominator of earnings per share calculations (amounts in thousands, except per share amounts):

NOTE 11 — EARNINGS PER COMMON SHARE (CONTINUED)

The following table identifies the number of shares of common stock underlying the RSUs that are included in the calculation, on a diluted basis, for such years:

There wereno options outstanding to purchase shares of common stock or other rights exercisable for, or convertible into, common stock in 2025, 2024 and 2023.

NOTE 12 — RELATED PARTY TRANSACTIONS

Compensation and Services Agreement

Pursuant to the compensation and services agreement (“C&SA”) with Majestic Property Management LLC (“Majestic”), Majestic provides the Company with certain (i) executive, administrative, legal, accounting, clerical, property management, property acquisition, consulting (i.e., sale, leasing, brokerage, and mortgage financing), and construction supervisory services (collectively, the “Services”) and (ii) facilities and other resources. Majestic provides compensation to several of the Company’s executive officers and is indirectly owned by, among others, Matthew J. Gould, the Company’s chairman, and Jeffrey A. Gould, a director and senior vice president of the Company.

During 2025, 2024, and 2023, in consideration for the Services, the Company paid Majestic $3,619,000, $3,322,000 and $3,317,000, respectively. Included in these fees are $1,628,000 in 2025, $1,444,000 in 2024 and $1,510,000 in 2023 of property management services. The amounts paid for property management services are based on 1.5% and 2.0% of the rental payments (including tenant reimbursements) actually received by the Company from net lease tenants and operating lease tenants, respectively. The Company does not pay Majestic for property management services with respect to properties managed by third parties. During 2025, 2024 and 2023, the Company also paid Majestic, pursuant to the C&SA, $350,000,$336,000 and $317,000, respectively, for the Company’s share of all direct office expenses, including rent, telephone, postage, computer services, internet usage and supplies.

Executive officers and others providing services to the Company under the C&SA were awarded shares of restricted stock and RSUs under the Company’s stock incentive plans. During 2025, 2024 and 2023, the related expense charged to the Company’s operations was$2,562,000, $2,401,000 and $2,499,000, respectively.

The amounts paid under the C&SA (except for the property management services which are included in Real estate expenses) and the costs of the stock incentive plans are included in General and administrative expense on the consolidated statements of income.

Other

During 2025, 2024 and 2023, the Company paid fees of (i) $339,000, $326,000 and $313,000, respectively, to the Company’s chairman and (ii) $135,000, $130,000 and $125,000, respectively, to the Company’s vice chairman. These fees are included in General and administrative expense on the consolidated statements of income.

At December 31, 2025 and 2024, Gould Investors L.P. (“Gould Investors”), a related party, owned 2,272,601 shares of the outstanding common stock of the Company, or approximately 10.5% and 10.6%, respectively.

The Company obtains its property insurance in conjunction with Gould Investors and reimburses Gould Investors annually for the Company’s insurance cost relating to its properties. Amounts reimbursed to Gould Investors were$3,042,000, $1,177,000 and $1,093,000 during 2025, 2024 and 2023, respectively. Included in Real estate expenses on the consolidated statements of income is insurance expense of$2,216,000, $1,139,000 and $893,000 during 2025, 2024 and 2023, respectively. The balance of the amounts reimbursed to Gould Investors represents prepaid insurance and is included in Escrow, deposits and other assets and receivables on the consolidated balance sheets.

NOTE 13 — OTHER INCOME

Beachwood, Ohio Litigation

In November 2025, in connection with the sale of a property located in Beachwood, Ohio (see Note 5), the Company entered into an agreement pursuant to which it received $1,300,000 in connection with the settlement of a lawsuit captioned*Eastgate LLC, et al. v. OLP Beachwood OH LLC,*which is recorded as Income on settlement of litigation on the consolidated statement of income for the year ended December 31, 2025.

NOTE 14 — COMMITMENTS AND CONTINGENCIES

The Company maintains a non-contributory defined contribution pension plan covering eligible employees. Contributions by the Company are made through a money purchase plan, based upon a percent of the qualified employees’ total salary (subject to the maximum amount allowed by law). Pension expense approximated$436,000, $431,000 and $436,000 for 2025, 2024 and 2023, respectively, and is included in General and administrative expense on the consolidated statements of income.

The Company is party to (i) leases obligating it to provide tenant improvement allowances and (ii) various legal proceedings. Management believes these allowances and proceedings are routine, incidental to the operation of the Company’s business and that such allowance payments or proceedings will not have a material adverse effect upon the Company’s consolidated financial statements taken as a whole.

NOTE 15 — INCOME TAXES

The Company elected to be taxed as a REIT under the Internal Revenue Code, commencing with its taxable year ended December 31, 1983. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement that it currently distribute at least 90% of its ordinary taxable income to its stockholders. As a REIT, the Company generally will not be subject to corporate level federal, state and local income tax on taxable income it distributes currently to its stockholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal, state and local income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not be able to qualify as a REIT forfour subsequent taxable years. It is management’s current intention to maintain the Company’s REIT status.

Even though the Company qualifies for taxation as a REIT, the Company is subject to certain state and local taxes on its income and property, and to federal income and excise taxes on its undistributed taxable income. As of December 31, 2025, tax returns for the calendar years 2022 through 2024 remain subject to examination by the Internal Revenue Service and various state and local tax jurisdictions. In 2025 and 2024, the Company collected refunds of $135,000 and $238,000, respectively, from Tennessee related to franchise taxes paid during 2020 through 2023, as the state amended the method of calculating such taxes, resulting in overpayments made in such years. The refunds are included in State Taxes on the consolidated statements of income for the years ended December 31, 2025 and 2024, respectively.

During 2025, 2024 and 2023, the Company did not incur any federal income tax expense. The Company does not have any deferred tax assets or liabilities at December 31, 2025 and 2024.

NOTE 15 — INCOME TAXES (CONTINUED)

The approximate allocation of the distributions made to stockholders is as follows for the years indicated:

The Company treats depreciation expense, straight-line rent adjustments and certain other items differently for tax purposes than for financial reporting purposes. Therefore, its taxable income and dividends paid deduction differs from its financial statement income.

The following table reconciles dividends declared with the dividends paid deduction for the years indicated (amounts in thousands):

NOTE 16 — SUBSEQUENT EVENTS

Subsequent events have been evaluated and, except as previously disclosed, there were no other events relative to the consolidated financial statements that require additional disclosure.

Schedule III—Consolidated Real Estate and Accumulated Depreciation

December 31, 2025

(Amounts in Thousands)