GENERATION INCOME PROPERTIES, INC.
For the period ended Dec 31, 2025. Filed Apr 1, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Apr 1, 2026
GIPR$0.25-2.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-28.
0000950170-25-046959
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-04-01.
0001193125-26-135022
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 121 previous paragraphs and 139 current paragraphs.
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Tables are not compared: 6 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (50)
Current report
Our Near-Term and Long-Term Strategy
Current report
Historically, our long-term objective has been to acquire and manage a diversified portfolio of high-quality net leased properties that generates predictable cash flows and capital appreciation over market cycles. We have generally sought to identify properties in submarkets with high barriers to entry for development and where valuation is frequently influenced by local real estate market conditions and tenant needs. Notwithstanding our long-term strategy to grow our assets through additional property acquisitions, our strategy over the next twelve months will focus on improving our balance sheet and increasing our stockholder equity and liquidity by methodically and opportunistically marketing and selling a select group of up to 18 of our income-producing properties. The goal of this near-term strategy is to enable us to obtain proceeds that, together with proceeds from anticipated equity capital-raising transactions, will enable us to substantially reduce our preferred stock obligations and certain commercial debt and better position us for growth capital and less and less-expensive debt financing in the future. We have already initiated this process and have begun marketing these 18 properties through a broker with significant experience in selling single-tenant commercial net lease properties, and these sales (if made) will be in addition to the 5 property sales that we made in 2025. We believe that if we are able to successfully execute on this near-term sale strategy, the Company and our balance sheet will be better positioned to attract growth capital and less-expensive debt financing that will provide a foundation for resuming the growth of our asset base.
Current report
Recent Developments regarding Nasdaq Listing
Current report
In August 2025, we received notice from the Listing Qualifications staff of Nasdaq (the “Staff”) notifying us that we no longer maintained at least $2.5 million in stockholders’ equity, as required under Nasdaq Listing Rule 5550(b)(1) (the “Equity Requirement”) and that we also did not meet any other alternative standard. On October 6, 2025, we submitted to the Staff a written plan to become compliant with the Equity Requirement and were given until February 5, 2026, to regain compliance. Because we were unable to regain compliance by such date, on February 5, 2026, the Staff provided written notification that the trading of our common stock and warrants would be suspended at the open of business on February 17, 2026 unless the Company appealed the Staff’s determination to the Nasdaq Hearings Panel. We thereafter timely appealed the Staff’s determination, and on March 24, 2026, a hearing was held before the Nasdaq Hearings Panel, during which time we requested an extension of time and submitted a plan to regain compliance with both the Equity Requirement and Minimum Bid Requirement (as described below) by August 2026, with such plan consisting of a combination of property sales, capital raises, and a reverse stock split. As of the date of the filing of this Annual Report on Form 10-K, we had not yet been informed as to whether the Nasdaq Hearings Panel has decided to grant an extension of time to regain compliance, and it is possible that we will not be granted a further extension, whereupon our common stock and warrants would be delisted. Even if we are granted an extension of time to regain compliance, there is no assurance that we will be able to actually regain compliance during such period.
Current report
On January 28, 2025, we received notice from Nasdaq that, because the closing bid price for our common stock had fallen below $1.00 per share for 30 consecutive business days, we no longer complied with the minimum bid price requirement pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Requirement”). We were provided an initial compliance period of 180 calendar days, or until July 27, 2026, to regain compliance with the Minimum Bid Requirement. To regain compliance, the closing bid price of our common stock must meet or exceed $1.00 per share for a minimum of 10 consecutive business days prior to July 27, 2026. We intend to continue to actively monitor the closing bid price of our common stock and will evaluate available options to regain compliance with the Minimum Bid Requirement. Specifically, we have confirmed to Nasdaq at the hearing held on March 24, 2026 that, if necessary, we will implement a reverse stock split of our outstanding common stock prior to July 27, 2026 to attempt to regain compliance. There can be no assurance that we will regain compliance with the Minimum Bid Requirement during the 180-day compliance period or maintain compliance with the other Nasdaq listing requirements.
Current report
There is no assurance that we will be able to meet Nasdaq’s listing requirements or comply with the requisite Nasdaq requirements to maintain our listing of common stock and warrants on Nasdaq. In the event that our common stock and warrants are delisted from Nasdaq, as a result of our failure to comply with the Equity Requirement or the Minimum Bid Requirement or as a result of our failure to continue to comply with any other requirement for continued listing on Nasdaq, and we are not able to list our securities on Nasdaq or any other national securities exchange, we could face significant material adverse consequences, including:
Current report
• a decline of the market price of our common stock;
Current report
• a limited availability of market quotations for our common stock;
Current report
• reduced liquidity for our common stock;
Current report
• a determination that our common stock is a “penny stock,” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;
Current report
• a limited amount of news and analyst coverage for us;
Current report
• a decreased ability to issue additional securities or obtain additional financing in the future; and
Current report
• the incurring of additional costs under state blue sky laws in connection with any sales of our securities.
Current report
If our common stock is delisted by Nasdaq, our common stock may be eligible to trade on an over-the-counter quotation system where an investor may find it more difficult to sell our stock or obtain accurate quotations as to the market value of our common stock. In the event our common stock is delisted from Nasdaq, we may not be able to list our common stock on another national securities exchange or obtain quotation on an over-the-counter quotation system.
Current report
Other Recent Developments
Current report
On February 6, 2025, the Company, through its Operating Partnership, acquired interests in three single-tenant net-leased retail properties through a contribution transaction for total consideration of approximately $11.2 million, consisting of Operating Partnership units issued to the contributors and the assumption of approximately $7.0 million of existing mortgage indebtedness secured by the properties. The acquired properties are located in Cleveland, Tennessee; Kernersville, North Carolina; and Sanford, Florida and are leased to Dollar General, Tractor Supply Company, and Zaxby's, respectively, under long-term triple-net leases with contractual rent escalations and renewal options.
Current report
Dispositions
Current report
During the twelve months ended December 31, 2025, the Company disposed of five properties for aggregate gross proceeds of approximately $24.3 million. The dispositions consisted of the Starbucks - Tampa, Florida and former Pratt & Whitney Automation - Huntsville, Alabama properties sold on May 29, 2025; the former Irby Construction - Plant City, Florida property sold on October 30, 2025; and the Best Buy - Grand Junction, Colorado and exp U.S. Services - Maitland, Florida properties sold on December 5 and December 15, 2025, respectively. Net proceeds were used primarily to repay property-level mortgage indebtedness. The Company recognized a gain on sale of real estate of approximately $1.9 million in connection with these transactions.
Current report
The Company's dividend for common stockholders remains suspended, as announced by the Board of Directors on July 3, 2024. No dividends were declared or paid to common stockholders during the twelve months ended December 31, 2025.
Current report
On February 6, 2025, the Operating Partnership issued 698,465 Series B-2 Preferred Units at $6.00 per unit, valued in aggregate at approximately $4.2 million, to the contributors of the three NNN properties acquired on that date. The Series B-2 Preferred Units carry a cumulative annual distribution of $0.33 per unit, payable monthly in arrears, and are redeemable beginning on the second anniversary of closing.
Current report
On August 7, 2025, the Company exercised its first of two twelve-month extension options under the GIP SPE Operating Agreement with LC2-NNN Pref, LLC, extending the mandatory redemption date from August 10, 2025 to August 10, 2026. In connection with the extension, the Company paid an extension fee of $141,000 and the preferred equity return increased from 15.5% to 18% per annum. The Preferred Interest is presented as temporary equity at a redemption value of $14.1 million plus accrued preferred interest of $4.2 million as of December 31, 2025.
Current report
The Brown Family Enterprises, LLC preferred equity redemption date for the Norfolk, Virginia properties remains February 8, 2027, presented as temporary equity at an aggregate redemption value of $3.0 million as of December 31, 2025.
Current report
On May 29, 2025, the Company's President and CEO provided a $610,000 loan to the Company bearing interest at 5.75% per annum to fund closing costs associated with the May 2025 property dispositions. The loan was extended to December 31, 2025 and remained unpaid as of that date and as of the date of the filing of this Form 10-K.
Current report
On June 13, 2025, the Company entered into a $1.1 million loan agreement with Valley National Bank secured by the Company's 7-Eleven store in Washington, D.C., bearing interest at a fixed rate of 6.50% per annum with a maturity date of June 13, 2030, subject to tenant lease renewal conditions.
Current report
Concurrent with the May 2025 dispositions, the Company repaid in full the cross-collateralized loan previously secured by the Washington, D.C., Tampa, Florida, and Huntsville, Alabama properties, resulting in a loss on extinguishment of debt of $926,398, consisting of $286,218 of unamortized debt issuance costs and $640,180 of prepayment premiums and liquidation fees.
Current report
On February 12, 2026, one of our subsidiaries entered into a loan transaction for a $125,000 loan from QCCR Investments, LLC, an affiliate of Richard D. Russell, a director of the Company. The proceeds of the loan were used to fund costs associated with the Company’s appeal of the decision by the staff of The Nasdaq Stock Market LLC to deny the Company’s request for continued listing on the The Nasdaq Capital Market, as described in the Company’s Current Report on Form 8-K filed on February 6, 2026. All principal under the loan, together with accrued but unpaid interest at an interest rate of 12% per annum and an origination fee of 3% of the principal amount, will be due on November 12, 2026, if earlier, the date of the sale of the Company’s real estate asset located at 2510 Walmer Ave in Norfolk, Virginia. The loan is secured by 100% of the Company’s equity interest in the Company’s subsidiary that holds Walmer Ave property.
Current report
Lloyd M. Bernstein / Series B-2 Preferred Units
Current report
On February 6, 2025, in connection with the acquisition of three single-tenant NNN properties, the Operating Partnership issued 698,465 Series B-2 Preferred Units at $6.00 per unit to the contributing members of LMB Lewiston, LLC, LMB Ft. Kent, LLC, and LMB Auburn Hills I, LLC, valued in aggregate at approximately $4.2 million. The Series B-2 Preferred Units carry a cumulative annual distribution of $0.33 per unit, payable monthly in arrears. Beginning on the second anniversary of closing, holders may elect to redeem their units for a redemption amount as defined in the Amended and Restated Agreement of Limited Partnership. The non-controlling interest is presented as temporary equity at a redemption value of $4,209,154 as of December 31, 2025.
Current report
LC2-NNN Pref, LLC
Current report
In connection with the acquisition of the Modiv Portfolio in August 2023, LC2-NNN Pref, LLC holds a preferred equity interest in GIP SPE with an initial investment of $14.1 million, carrying a cumulative distribution preference of 15.5% per annum. On August 7, 2025, the Company exercised its first twelve-month extension option, extending the mandatory redemption date from August 10, 2025 to August 10, 2026. In connection with the extension, the Company paid an extension fee of $141,000 and the preferred equity return increased from 15.5% to 18% per annum, of which the current preferred return remained at 5% per annum and the accrued preferred return increased from 10.5% to 13% per annum. The Preferred Interest is presented as temporary equity at a redemption value of $14,100,000 plus accrued but unpaid preferred interest of $4,189,142 as of December 31, 2025.
Current report
Brown Family Enterprises, LLC
Current report
Brown Family Enterprises, LLC holds Class A Preferred Units in the Company's two Norfolk, Virginia property subsidiaries at an aggregate redemption value of $3,000,000, with a redemption date of February 8, 2027. The Company is required to pay a 7% IRR monthly and will share 16% of equity in each subsidiary upon a capital transaction. The non-controlling interest is presented as temporary equity at $3,000,000 as of December 31, 2025.
Current report
Brown Family Enterprises, LLC also serves as a lender to the Company under two outstanding loan arrangements. The first is a secured promissory note with an outstanding balance of $5,500,000 bearing interest at 9% per annum, maturing October 14, 2026. The second is the above-described $1,000,000 secured promissory note originated on April 25, 2025, bearing interest at 16% per annum for the first 90 days, reverting to 9% thereafter, which was subsequently amended twice to extend the maturity to January 30, 2026, incurring aggregate extension fees of $82,000. As of December 31, 2025, both loans remained outstanding with aggregate principal of $6,500,000 unpaid. The $5,500,000 loan matures October 14, 2026 and the Company is actively evaluating refinancing options. See Debt Financing above for further detail.
Current report
General and administrative expense increased by $81,780, or approximately 4%, year over year, reflecting an increase in consulting fees and higher fees from existing professional service providers supporting audit, tax, and financial reporting functions.
Current report
Building expenses decreased by $144,097, or approximately 5%, year over year. The three properties acquired in February 2025 are structured as triple-net leases under which tenants bear substantially all operating expenses, contributing minimal incremental building costs. This was further aided by the removal of operating costs associated with five property dispositions completed during 2025.
Current report
Depreciation and amortization increased by $230,514, or approximately 5%, year over year, reflecting partial-year depreciation on three single-tenant NNN properties acquired on February 6, 2025 (Dollar General, Tractor Supply, and Zaxby's), partially offset by the cessation of depreciation on five properties disposed of during 2025.
Current report
Interest expense, net increased by $1,484,734, or approximately 35%, year over year. The increase was driven primarily by $808,953 of default interest recognized in connection with the payoff of the cross-collateralized mortgage loan secured by the Company's Washington, D.C., Tampa, Florida, and Huntsville, Alabama properties, which is non-recurring in nature. Additional contributing factors include partial-year interest on debt assumed in connection with three NNN property acquisitions completed February 6, 2025, a new $1.1 million mortgage loan on the Company's Washington, D.C. 7-Eleven property originated June 13, 2025, and interest and extension fees on a $1.0 million related-party loan from Brown Family Enterprises, LLC entered into in April 2025. These increases were partially offset by the retirement of mortgage indebtedness associated with five property dispositions completed during 2025 and a decrease in guaranty fee expense from $387,056 in 2024 to $316,298 in 2025. During the twelve months ended December 31, 2025, the Company incurred a guaranty fee expense of $316,298 payable to our President and CEO, of which $510,642 remained payable as of December 31, 2025.
Current report
Compensation costs increased by $179,946, or approximately 17%, primarily due to restricted stock compensation and increase in contractual increase in executive salary per the amended and restated employment agreement dated August 24, 2024.
Current report
On February 6, 2025, we completed the acquisition of three single-tenant NNN properties through a contribution transaction for total consideration of approximately $11.2 million, consisting of Operating Partnership units issued to the contributors and the assumption of approximately $7.0 million of existing mortgage indebtedness secured by the properties.
Current report
On April 25, 2025, the Company entered into a $1.0 million secured promissory note with Brown Family Enterprises, LLC, a related party, bearing interest at 16% per annum for the first 90 days, reverting to 9% thereafter. The note was subsequently amended twice, extending the maturity date to January 30, 2026 and incurring aggregate extension fees of $82,000. As of December 31, 2025, the outstanding principal balance of $1.0 million, together with accrued interest, remained unpaid. The original Brown Family Enterprises note, increased to $5.5 million in July 2023 and bearing interest at 9% per annum, matures October 14, 2026.
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Removed paragraphs (32)
Previous report
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Previous report
Prior tenant terminated the lease and vacated on January 31, 2024, space was relet to a new tenant in August 2024.
Previous report
Recent Developments
Previous report
On August 29, 2024, we acquired a 30,465 square foot retail property in Ames, Iowa for $5.5 million occupied by Best Buy with a remaining lease of approximately 6 years at an annual base rent of $405,470. Future minimum rent reflected in the above table, accordingly.
Previous report
On January 29, 2024 the Company exchanged all shares of its Series A Redeemable Preferred Stock to 2,794,597 shares of our common stock according to the following allocation:
Previous report
2,623,153 shares out of the 2,794,597 shares of our common stock were distributed by Modiv OP and subsequently distributed by Modiv to the holders of its common stock;
Previous report
the remaining 171,444 shares of our common stock issued to Modiv OP will be held by Modiv OP.
Previous report
On July 24, 2024, the Operating Partnership of Generation Income Properties, Inc., entered into a Fifth Amendment to the Amended and Restated Limited Partnership Agreement of the Operating Partnership (the “LPA Amendment”), pursuant to which the Company, as the general partner of the Operating Partnership, issued partnership interests to LMB Owenton I LLC (“Contributor”) in the form of Series B-1 Preferred Units (the “Series B-1 Preferred Units”).
Previous report
Also on July 24, 2024, the Operating Partnership and the Contributor entered into a Contribution and Exchange Agreement (the “Contribution Agreement”) pursuant to which the Contributor contributed 155,185 Common Units in exchange for 155,185 Series B-1 Preferred Units. If and when determined by the Company, as general partner of the Operating Partnership, in its sole discretion, holders of the Series B-1 Preferred Units will be paid cash distributions in the amount of $0.117 per Series B-1 Preferred Unit per quarter, subject to prior payment of any preferred return on senior preferred units of the Operating Partnership. The Contributor will have the right to cause the Operating Partnership to redeem the Series B-1 Preferred Units after two (2) years for either (i) cash in an amount equal to $7.15 per Series B-1 Preferred Unit or (ii) a number of shares of common stock of the Company equal to the number of Series B-1 Preferred Units being redeemed multiplied by 1.00, plus, in each case, an amount equal to all dividends accrued and unpaid thereon.
Previous report
On July 25, 2024, the Operating Partnership entered into First Amendments to the Second Amended and Restated Limited Liability Company Agreements, dated as of February 8, 2023, for each of the Norfolk, Virginia properties, GIPVA 2510 Walmer Ave, LLC and GIPVA 130 Corporate Blvd, LLC to revise the redemption date of Brown Family Enterprises, LLC membership interests from February 8, 2025 to February 8, 2027.
Previous report
Corporate and Administrative
Previous report
On July 19, 2024, we determined that MaloneBailey LLP (“MaloneBailey”) would no longer serve as the Company’s independent registered public accounting firm and would be dismissed effective as of July 19, 2024. The decision to change independent registered public accounting firms was approved by the Board of Directors and the Audit Committee of the Company on July 19, 2024.
Previous report
On July 19, 2024, we ratified the appointment of CohnReznick LLP (“CohnReznick”) as the Company's new independent registered public accounting firm to audit and review the Company’s financial statements.
Previous report
We modified terms for two secured mortgage loans set to expire in September 2024 and October 2024. As of September 30, 2024 the principal balances of the modified secured loans were $7.2 million and $4.4 million at 6.15% annual interest with maturity dates extended to August 2029.
Previous report
On February 8, 2023, the Operating Partnership entered into new Amended and Restated Limited Liability Company Agreements for the Norfolk, Virginia properties, GIPVA 2510 Walmer Ave, LLC ("GIPVA 2510") and GIPVA 130 Corporate Blvd, LLC ("GIPVA 130"), in which the Operating Partnership, as the sole member of GIPVA 2510 and GIPVA 130, admitted a new preferred member, Brown Family Enterprises, LLC, through the issuance of preferred membership interests in the form of Class A Preferred Units of GIPVA 2510 and GIPVA 130. GIPVA 2510 and GIPVA 130 (the “Virginia SPEs”) hold the Company’s Norfolk, Virginia properties. In addition, both of the Virginia SPEs and Brown Family Enterprises, LLC entered into Unit Purchase Agreements in which GIPVA 2510 issued and sold 180,000 Class A Preferred Units at a price of $10.00 per unit for an aggregate price of $1,800,000, and GIPVA 130 issued and sold 120,000 Class A Preferred Units at a price of $10.00 per unit for an aggregate price of $1,200,000. The Operating Partnership is the general manager of the subsidiary while Brown Family Enterprises, LLC is a preferred equity member. Pursuant to the agreement, the Company is required to pay the preferred equity member a 7% IRR paid on a monthly basis and will share in 16% of the equity in each of the Virginia SPEs upon a capital transaction resulting in distributable proceeds. Brown Family Enterprises, LLC has the right to redeem the preferred equity at redemption value. On July 25, 2024, we entered into First Amendments to the Second Amended and Restated Limited Liability Company Agreements, dated as of February 8, 2023, for each of these entities revising the redemption date from February 8, 2025 to February 8, 2027. Because of the redemption right, the non-controlling interest is presented as temporary equity at an aggregated redemption value of $3,000,000 as of December 31, 2024.
Previous report
Agreement with LMB Owenton I, LLC
Previous report
On February 7, 2023, the Operating Partnership entered into a Unit Issuance Agreement and Amendment to Contribution and Subscription Agreement with LMB Owenton I LLC in which the Operating Partnership and LMB Owenton I LLC agreed to delay the Contributor’s right to require the redemption of the Contributor’s GIP LP Units in the Operating Partnership until after 36 months on January 14th, 2025 and for a reduced redemption price of $7.15 per GIP LP Unit. Such agreement was made in consideration of the issuance to LMB Owenton I LLC of an additional 44,228 GIP LP Units in the Operating Partnership, resulting in Contributor owning an aggregate of 155,185 GIP LP Units in the Operating Partnership at redemption value of $1,109,570 as of December 31, 2024.
Previous report
General and administrative expense increased by $375,137, or approximately 22%, year over year as the Company engaged incremental professional services support for audit, tax, financial reporting and other professional services. Approximately, $300,000 of the increase comprises nonrecurring or transaction specific expenditures.
Previous report
Building expenses increased by $974,424, or approximately 57%, resulting from full year operations during 2024 versus five months of the integrated Modiv properties in 2023. Key expenditures increased as follows, property taxes approximately $548,000, repairs, maintenance and janitorial approximately $315,000, and utilities approximately $78,000 year over year.
Previous report
Depreciation and amortization increased by $1,226,634, or 35%, resulting from full year operations during 2024 versus five months of the integrated Modiv properties in 2023.
Previous report
Interest expense, net increased by $1,542,140, or 56%, resulting from full year operations during 2024 versus five months of the integrated Modiv properties in 2023. Additionally, during the twelve months ended December 31, 2024, we incurred a guaranty fee expense of $387,056 payable to our President and CEO of which $206,219 remained payable as of December 31, 2024.
Previous report
Compensation costs decreased by $312,203, or approximately 23% as management optimized staffing levels and overhead to align with the Company's scale.
Previous report
Income on Investment in Tenancy in Common
Previous report
For the twelve months ended December 31, 2024 and 2023, our share of earnings on our investment in tenancy in common and accounted for under the equity method generated income of $0 and $32,773, respectively. On September 7, 2023, the Company purchased the remaining tenancy-in-common ("TIC") interest and assumed control of the property. As of December 31, 2024, the Company owns the full interest in the property and the TIC interest is no longer exists.
Previous report
On April 1, 2022, we entered into two mortgage loan agreements with an aggregate balance of $13.5 million to refinance seven of our properties. The loan agreements consist of one loan in the amount of $11.4 million secured by six properties and allocated to each property based on each property's appraised value, and one loan in the amount of $2.1 million on the property previously held in the tenancy-in-common investment at an interest rate of 3.85% from April 1, 2022 through and until March 31, 2027. In conjunction with the LC2 Investment to purchase the remaining interest in the tenancy-in-common interest discussed above, we assumed the original $2.1 million loan on the property with a balance as of December 31, 2024 of $2,014,851. Effective April 1, 2027 and through the maturity date of March 31, 2032, the interest rate adjusts to the 5-year Treasury plus 2.5% and is subject to a floor of 3.85%. Our CEO entered into a guarantee agreement pursuant to which he guaranteed the payment obligations under the promissory notes if they become due as a result of certain “bad-boy” provisions, individually and on behalf of the Operating Partnership.
Previous report
On August 9, 2022, we entered a Redemption Agreement with a unit holder. As such, the Company recorded an Other payable - related party in the amount of $2,912,300 upon execution of the Redemption Agreement entered into July 20, 2022 and has paid the note in full as of December 31, 2024. Remaining balances of $0 and $1,809,840 were outstanding as of December 31, 2024 and 2023, respectively.
Previous report
On October 14, 2022, we entered into a loan transaction that is evidenced by a secured non-convertible promissory note to Brown Family Enterprises, LLC, a preferred equity partner and therefore a related party, for $1.5 million that is due on October 14, 2024, and bears a fixed interest rate of 9%, simple interest. Interest is payable monthly. The loan may be repaid without penalty at any time. The loan is secured by the Operating Partnership’s equity interest in its current direct subsidiaries that hold real estate assets pursuant to the terms of a security agreement between the Operating Partnership and Brown Family Enterprises, LLC. On July 21, 2023, the Company amended and restated the promissory note to reflect an increase in the loan to $5.5 million and extend the maturity date thereof from October 14, 2024 to October 14, 2026. Except for the increase in the amount of the Loan and Note and the extension of the maturity date thereof, no changes were made to the original note.
Previous report
On August 10, 2023, we entered into a $21.0 million loan agreement with Valley National Bank ("Valley") to finance the acquisition of the Modiv Portfolio. The outstanding principal amount of the loan bears interest at an annual rate for each 30-day interest period equal to the compounded average of the secured overnight financing rate published by Federal Reserve Bank of New York for the thirty-day period prior to the last day of each 30-day interest rate for the applicable interest rate period plus 3.25%, with interest payable monthly after each 30-day interest period. However, we entered into an interest rate swap to fix the interest rate at 7.47% per annum. Payments of interest and principal in the amount of approximately $156,000 are due and payable monthly, with all remaining principal and accrued but unpaid interest due and payable on a maturity date of August 10, 2028. The loan may generally be prepaid at any time without penalty in whole or in part, provided that there is no return of loan fees and prepaid financing fees. The loan is secured by first mortgages and assignments of rents in the properties comprising the Modiv Portfolio and eight other properties held by subsidiaries of GIP SPE that had outstanding loans with Valley. All of the mortgaged properties cross collateralize the loan, and the loan is guaranteed by the Operating Partnership and the subsidiaries that hold the properties subject to the acquisition of the Modiv Portfolio. The loan agreement requires a minimum debt-service coverage ratio 1.50:1 on a trailing twelve-month basis, tested as of December 31, 2024 and annually thereafter. Our President and CEO also entered into a personal, full recourse guarantee with a $7,500,000 cap. We were in compliance with all covenants with the exception of one property-level debt service coverage ratio ("DSCR") covenant for 15091 SW Alabama 20, LLC. In January 2024, Pratt and Whitney Automation vacated the property at the end of their lease and the property remained vacant for six months, thereafter. In August 2024, the Company entered into a lease with Auburn University for approximately 50 percent of the property's leasable space. During the six months of physical and economic vacancy, the property's mortgage DSCR was below the required 1.25 threshold resulting in a covenant deviation.
Previous report
We anticipate that our current cash on hand and availability under the Facility combined with the revenue generated from investment properties and proceeds from debt arrangements will provide sufficient liquidity to meet future funding commitments for at least the next 12 months.
Previous report
Net cash provided by operations was $1,022,362 and $12,345 during the twelve months ended December 31, 2024 and 2023, respectively. The change is primarily due to operating the Modiv portfolio for twelve months compared with only five months during the periods ended December 31, 2024 and 2023, respectively. The increase in operating cash also reflects the Company's optimization of timing for settling working capital accounts. We expect our cash flows from continuing operations during the upcoming fiscal cycle to be similar to our current year cash flows.
Previous report
Net cash used in investing was $5,773,323 and $33,314,974 for the twelve months ended December 31, 2024 and 2023, respectively. The year over year change is primarily due to the acquisition of the 13 property Modiv portfolio in August 2023 compared with the single property acquisition of Best Buy Ames, IA in August 2024.
Previous report
Net cash provided by financing activities was $2,246,453 and $32,701,579 for the twelve months ended December 31, 2024 and 2023, respectively. The change is primarily due to the financing scale for acquisition of the 13 property Modiv portfolio in August 2023 compared with the acquisition of a single property, Best Buy Ames, IA in August 2024.
Reworded paragraphs (10)
Previous wording
Contractual Rent Growth. 93% of the leases in our current portfolio (based on annualized base rent as of December 31, 2024) provide for increases in contractual base rent during future years of the current term or during the lease extension periods.
Current wording
Contractual Rent Growth. 92% of the leases in our current portfolio (based on annualized base rent as of December 31, 2025) provide for increases in contractual base rent during future years of the current term or during the lease extension periods.
Previous wording
Annualized cash base rental income in place as of December 31, 2024. Our leases do not include tenant concessions or abatements.
Current wording
Annualized cash base rental income in place as of December 31, 2025. Our leases do not include tenant concessions or abatements, except for Dollar Tree in Morrow, Georgia which had 2-months free rent in Q3 2025, and 7-Eleven in Washington, DC, which had 2 months free rent in Q4 2025.
Previous wording
Agreements with Brown Family Enterprises, LLC
Current wording
On April 25, 2025, the Company entered into a $1.0 million secured promissory note with Brown Family Enterprises, LLC bearing interest at 16% per annum for the first 90 days, reverting to 9% thereafter. The note was subsequently amended on October 27, 2025 and December 15, 2025, extending the maturity date to January 30, 2026 and incurring aggregate extension fees of $82,000. As of December 31, 2025, the outstanding principal balance of $1.0 million, together with accrued interest, remained unpaid. We have been able to retire this obligation in full as of the date of this Form 10-K.
Previous wording
For twelve months ended December 31, 2024, total revenue from operations was $9,762,636 as compared to $7,632,600 for the twelve months ended December 31, 2023. The revenue increase of $2,130,036 for the twelve-months ended December 31, 2024, resulted from having a full year versus five months of operating the properties acquired in the Modiv acquisition during 2024 and 2023, respectively.
Current wording
For twelve months ended December 31, 2025, total revenue from operations was $9,739,942 as compared to $9,762,636 for the twelve months ended December 31, 2024. The revenue decrease of $22,694 for the twelve-months ended December 31, 2025, resulted from five property sales, offset by three property acquisitions in February 2025, and lease concessions to facilitate lease renewals and extensions.
Previous wording
For the twelve months ended December 31, 2024 and 2023, we generated a net loss of $4,872,888 and 4,441,465, respectively.
Current wording
For the twelve months ended December 31, 2025 and 2024, we generated a net loss of $6,389,000 and 4,872,888, respectively.
Previous wording
For the twelve months ended December 31, 2024 and 2023, net income attributable to non-controlling interest was $3,476,599 and $1,275,797, respectively. The increase is primarily attributable to LC2-NNN Pref, LLC's $14,100,000 preferred equity investment in conjunction with the Modiv acquisition in August 2023, including servicing current and deferred interests as detailed in Preferred Equity.
Current wording
For the twelve months ended December 31, 2025 and 2024, net income attributable to non-controlling interest was $3,951,904 and $3,476,599, respectively. The increase is primarily attributable to LC2-NNN Pref, LLC's $14,100,000 preferred equity investment in conjunction with the Modiv acquisition in August 2023, including servicing current and deferred interests as detailed in Preferred Equity Partners Section.
Previous wording
For the twelve months ended December 31, 2024 and 2023, we generated a net loss attributable to our common shareholders of $8,444,487 and $6,192,262, respectively.
Current wording
For the twelve months ended December 31, 2025 and 2024, we generated a net loss attributable to our common shareholders of $10,340,904 and $8,444,487, respectively.
Previous wording
We require capital to fund our investment activities and operating expenses. Our capital sources may include net proceeds from offerings of our equity securities, cash flow from operations and borrowings under credit facilities. As of December 31, 2024, we had total cash (unrestricted and restricted) of $647,439, properties with a cost basis of $102,310,974 and outstanding debt of $56,817,310. We have implemented plans, which have alleviated going concern uncertainty and are disclosed in Note 1 to our annual financial statements. Below is a description of some of our more significant capital raise activities intended to improve our liquidity:
Current wording
We require capital to fund our investment activities and operating expenses. Our capital sources may include net proceeds from offerings of our equity securities, cash flow from operations and borrowings under credit facilities. As of December 31, 2025, we had total cash (unrestricted and restricted) of $6,198,816, properties with a cost basis of $97,011,131 and outstanding debt of $49,711,594. Below is a description of some of our more significant capital raise activities intended to improve our liquidity:
Previous wording
Our President and CEO has personally guaranteed the repayment of the $10.8 million due under the 7-11 - Washington, DC; Starbucks-South Tampa, FL; and Pratt & Whitney-Huntsville, AL loan as well as the $1.3 million loan secured by our Sherwin-Williams - Tampa, FL mortgage loan. In addition, our President and CEO has also provided a guaranty of the Borrower’s nonrecourse carveout liabilities and obligations in favor of the lender for the GSA and PRA Holdings, Inc. - Norfolk, VA mortgage loans with an aggregate principal amount of $11.9 million.
Current wording
Our President and CEO has personally guaranteed repayment of the $1.2 million loan secured by our Sherwin-Williams — Tampa, FL property and has provided a guaranty of the nonrecourse carveout liabilities and obligations for the GSA and PRA Holdings, Inc. — Norfolk, VA mortgage loans with an aggregate principal amount of approximately $11.2 million. Additionally, our President and CEO provided a guaranty of nonrecourse carveout obligations in connection with the $1.1 million loan on our 7-Eleven — Washington, D.C. property originated June 13, 2025. During the twelve months ended December 31, 2025 and 2024, the Company incurred guaranty fee expense of $316,298 and $387,056, respectively, payable to our President and CEO, of which $510,642 remained payable as of December 31, 2025.
Previous wording
As of December 31, 2024 and December 31, 2023, we had accounts payable, accrued expenses and insurance payable totaling $2,023,338 and $1,813,231, respectively. Outstanding indebtedness consisted of the following as of December 31, 2024 and December 31, 2023:
Current wording
As of December 31, 2025 and December 31, 2024, we had accounts payable, accrued expenses and insurance payable totaling $3,771,064 and $2,023,338, respectively. Outstanding indebtedness consisted of the following as of December 31, 2025 and December 31, 2024: