Alpine Income Property Trust, Inc.

Previous wording

When we refer to “we,” “us,” “our,” or “the Company,” we mean Alpine Income Property Trust, Inc. and its consolidated subsidiaries. References to “Notes to Financial Statements” refer to the Notes to the Consolidated Financial Statements of Alpine Income Property Trust, Inc. included in this Quarterly Report on Form 10-Q. Some of the comments we make in this section are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section below entitled “Special Note Regarding Forward-Looking Statements.” Certain factors that could cause actual results or events to differ materially from those the Company anticipates or projects are described in “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

Current wording

When we refer to “we,” “us,” “our,” or “the Company,” we mean Alpine Income Property Trust, Inc. and its consolidated subsidiaries. References to “Notes to Financial Statements” refer to the Notes to the Consolidated Financial Statements of Alpine Income Property Trust, Inc. included in this Quarterly Report on Form 10-Q. Some of the comments we make in this section are forward-looking statements within the meaning of the federal securities laws. For a discussion of forward-looking statements, see the section below entitled “Special Note Regarding Forward-Looking Statements.” Certain factors that could cause actual results or events to differ materially from those the Company anticipates or projects are described in “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and in “Part II, Item 1A. Risk Factors” of this Quarterly Report on Form 10-Q..

Previous wording

Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. These risks and uncertainties include, but are not limited to, the strength of the real estate market; the impact of a prolonged recession or downturn in economic conditions; our ability to successfully execute acquisition or development strategies; credit risk associated with us investing in commercial loans and investments; any loss of key management personnel; changes in local, regional, national and global economic conditions affecting the real estate development business and properties, including unstable macroeconomic conditions due to, among other things, geopolitical conflicts, inflation, and rising interest rates; the impact of competitive real estate activity; the loss of any major property tenants; the ultimate geographic spread, severity and duration of pandemics, actions that may be taken by governmental authorities to contain or address the impact of such pandemics, and the potential negative impacts of such pandemics on the global economy and our financial condition and results of operations; and the availability of capital. These risks and uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements.

Current wording

Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. These risks and uncertainties include, but are not limited to, the strength of the real estate market; the impact of a recession or downturn in economic conditions; our ability to successfully execute acquisition or development strategies; credit risk associated with us investing in commercial loans and investments; any loss of key management personnel; changes in local, regional, national and global economic conditions affecting the real estate development business and properties, including unstable macroeconomic conditions due to, among other things, geopolitical conflicts, inflation, higher interest rates; and tariffs and international trade policies; the impact of competitive real estate activity; the loss of any major property tenants; the ultimate geographic spread, severity and duration of pandemics, actions that may be taken by governmental authorities to contain or address the impact of such pandemics, and the potential negative impacts of such pandemics on the global economy and our financial condition and results of operations; and the availability of capital. These risks and uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements.

Previous wording

See “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 for further discussion of these risks, as well as additional risks and uncertainties that could cause actual results or events to differ materially from those described in the Company’s forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such statements, which speak only as of the date of this Quarterly Report on Form 10-Q. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

Current wording

See “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 and “Part II, Item 1A. Risk Factors” of this Quarterly Report on Form 10-Q for further discussion of these risks, as well as additional risks and uncertainties that could cause actual results or events to differ materially from those described in the Company’s forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such statements, which speak only as of the date of this Quarterly Report on Form 10-Q. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

Previous wording

As of September 30, 2024, we owned 133 properties, including the three properties classified as commercial loans and investments, with an aggregate gross leasable area of 3.6 million square feet, located in 34 states, with a weighted average remaining lease term of 8.8 years. Our portfolio was 99% occupied as of September 30, 2024.

Current wording

As of March 31, 2025, we owned 134 properties, including the three properties classified as commercial loans and investments, with an aggregate gross leasable area of 4.1 million square feet, located in 35 states, with a weighted average remaining lease term of 9.0 years. Our portfolio was 99% occupied as of March 31, 2025.

Previous wording

We may also acquire or originate commercial loans and investments associated with commercial real estate located in the United States. Our investments in commercial loans are generally secured by real estate or the borrower’s pledge of its ownership interest in an entity that owns real estate. As of September 30, 2024, the Company’s commercial loan investments portfolio had a total carrying value of $86.5 million and was comprised of five construction loans, one mortgage note, and three properties acquired pursuant to a sale-leaseback transaction whereby the tenant has a future repurchase right.

Current wording

We also acquire or originate commercial loans and investments associated with commercial real estate located in the United States. Our investments in commercial loans are generally secured by real estate or the borrower’s pledge of its ownership interest in an entity that owns real estate. As of March 31, 2025, the Company’s commercial loan investments portfolio had a total carrying value of $110.0 million and was comprised of six construction loans, two mortgage notes, and three properties acquired pursuant to a sale-leaseback transaction whereby the tenant has a future repurchase right.

Previous wording

Revenue from our property operations totaled $11.7 million and $11.4 million during the three months ended September 30, 2024 and 2023, respectively. The $0.3 million increase in lease income is primarily attributable to an increase in reimbursable revenue. The direct costs of revenues for our income properties totaled $1.8 million and $1.7 million during the three months ended September 30, 2024 and 2023, respectively. The $0.1 million increase in the direct cost of revenues is reflective of increased reimbursable expenses.

Current wording

Revenue from our property operations totaled $11.8 million and $11.5 million during the three months ended March 31, 2025 and 2024, respectively. The $0.3 million increase in lease income is primarily attributable to an increase in base rents due to the volume of property acquisitions versus dispositions. The direct costs of revenues for our income properties totaled $2.0 million and $1.9 million during the three months ended March 31, 2025 and 2024, respectively. The $0.1 million increase in the direct cost of revenues is reflective of increased reimbursable expenses.

Previous wording

Interest income from commercial loans and investments totaled $1.7 million and $0.1 million for the three months ended September 30, 2024 and 2023, respectively. The increase in income is attributable to the expanded portfolio of commercial loans and investments which, as of September 30, 2024, was comprised of five construction loans, one mortgage note, and three properties acquired pursuant to a sale-leaseback transaction whereby the tenant has a future repurchase right. As of September 30, 2023, the Company had originated is first construction loan and there was only one loan generating interest income.

Current wording

Interest income from commercial loans and investments totaled $2.3 million and $0.9 million for the three months ended March 31, 2025 and 2024, respectively. The $1.4 million increase in income is attributable to the expanded portfolio of commercial loans and investments which, as of March 31, 2025, was comprised of six construction loans, two mortgage notes, and three properties acquired pursuant to a sale-leaseback transaction whereby the tenant has a future repurchase right. As of March 31, 2024, the Company’s portfolio of commercial loans and investments was comprised of three construction loans and one mortgage note.

Previous wording

Other revenue totaled $0.1 million for the three months ended September 30, 2024. The revenue is attributable to fees earned from a revenue sharing agreement the Company entered into with CTO as further described in Note 19, “Related

Current wording

Other revenue totaled $0.1 million for the three months ended March 31, 2025 and 2024. The revenue is attributable to fees earned from a revenue sharing agreement the Company entered into with CTO as further described in Note 19, “Related Party Management Company” in the Notes to the Financial Statements.

Previous wording

General and administrative expenses totaled $1.8 million and $1.6 million during the three months ended September 30, 2024 and 2023, respectively. The $0.2 million increase is primarily the result of a $0.2 million increase in corporate legal and consulting fees.

Current wording

General and administrative expenses totaled $1.7 million and $1.5 million during the three months ended March 31, 2025 and 2024, respectively. The $0.2 million increase is primarily the result of an increase of less than $0.1 million in the management fee due to an increase in the weighted average of the Company’s equity base as well as increases of less than $0.1 million of director compensation and public company expenses.

Previous wording

During the nine months ended September 30, 2024, the Company recorded a $1.0 million impairment charge of which $0.4 million represents the CECL reserve related to our commercial loans and investments and $0.6 million represents the provision for losses related to our income properties as further described in Note 7, “Provision for Impairment”. During the nine months ended September 30, 2023, the Company recorded a $2.9 million impairment charge representing the provision for losses related to our income properties as further described in Note 7, “Provision for Impairment”.

Current wording

During the three months ended March 31, 2025, the Company recorded a $1.8 million impairment charge representing the provision for losses related to certain income properties as further described in Note 7, “Provision for Impairment”, and a $0.2 million impairment charge which represents the current expected credit losses (“CECL”) reserve related to our commercial loans and investments. During the three months ended March 31, 2024, the Company recorded a $0.03 million impairment charge representing the provision for losses related to our income properties as further described in Note 7, “Provision for Impairment”.

Previous wording

Interest expense totaled $3.2 million and $2.4 million during the three months ended September 30, 2024 and 2023, respectively. The $0.8 million increase in interest expense is attributable to the higher average outstanding debt balance for increased interest expense of $0.4 million as well as $0.3 million of interest expense resulting from the sale of participation interest in the Company’s $23.4 million Mortgage Note during the three months ended September 30, 2024.

Current wording

Interest expense totaled $3.6 million and $2.9 million during the three months ended March 31, 2025 and 2024, respectively. The $0.7 million increase in interest expense is attributable to the higher average outstanding balance on the Company’s Credit Facility as well as an increase in the fixed interest for the 2027 Term Loan effective in November of 2024, as well as $0.2 million of interest expense resulting from the sale of participation interest in the Company’s $24.0 million Mortgage Note as defined and further described in Note 4, “Commercial Loans and Investments” in the Notes to the Financial Statements. The overall increase in the Company’s long-term debt was primarily utilized to fund the acquisition of properties and commercial loans and investments during the three months ended March 31, 2025.

Previous wording

Net income totaled $3.4 million during the three months ended September 30, 2024 as compared to a net loss of $0.9 million during the three months ended September 30, 2023. The $4.3 million increase in net income is attributable to the factors described above, most notably the decrease in the provision for impairment of $2.4 million and the increase in the gain on disposition of assets of $0.8 million.

Current wording

Net loss totaled $1.3 million during the three months ended March 31, 2025 as compared to a net loss of $0.3 million during the three months ended March 31, 2024. The $1.0 million increase in net loss is attributable to the factors described above, most notably the increase in the provision for impairment of $2.0 million, partially offset by the $1.2 million increase in gains on disposition of assets.

Previous wording

Cash totaled $28.1 million as of September 30, 2024, including restricted cash of $25.5 million. See Note 2 “Summary of Significant Accounting Policies” under the heading Restricted Cash for the Company’s disclosure related to its restricted cash balance as of September 30, 2024.

Current wording

Cash totaled $11.6 million as of March 31, 2025, including restricted cash of $5.4 million. See Note 2 “Summary of Significant Accounting Policies” under the heading Restricted Cash for the Company’s disclosure related to its restricted cash balance as of March 31, 2025.

Previous wording

*Long-Term Debt.*As of September 30, 2024, the Company had an outstanding balance of $79.5 million on the $250 million revolving Credit Facility. The Company also had $200.0 million in term loans outstanding as of September 30, 2024. See Note 13, “Long-Term Debt” for the Company’s disclosure related to its long-term debt balance at September 30, 2024.

Current wording

*Long-Term Debt.*As of March 31, 2025, the commitment level under the Credit Facility was $250.0 million and the Company had an outstanding balance of $157.0 million and $56.4 million of available capacity. The Company also had $200.0 million in term loans outstanding as of March 31, 2025. See Note 13, “Long-Term Debt” for the Company’s disclosure related to its long-term debt balance at March 31, 2025.

Previous wording

*Acquisitions and Dispositions.*As further described in Note 3, “Property Portfolio,” the Company acquired six properties for a combined purchase price of $53.1 million, or a cost of $53.2 million including capitalized acquisition costs, and sold 10 properties for an aggregate sales price of $55.2 million, generating aggregate gains on sale of $4.3 million. Of the six properties acquired, the three Tampa Properties (previously defined in Note 1, “Business and Organization”), which were purchased during the three months ended September 30, 2024 through a sale-leaseback transaction that includes a tenant repurchase option are, for GAAP purposes, accounted for as a financing arrangement. However, as the Tampa Properties constitute real estate assets for both legal and tax purposes, we include the Tampa Properties in the property portfolio when describing our property portfolio and for purposes of providing statistics related thereto.

Current wording

*Acquisitions and Dispositions.*As further described in Note 3, “Property Portfolio,” during the three months ended March 31, 2025, the Company acquired three properties for a combined purchase price of $39.7 million, or a cost of $39.9 million including capitalized acquisition costs, and sold three properties for an aggregate sales price of $11.7 million, generating aggregate gains on sale of $1.2 million.

Previous wording

*ATM Program.*During the nine months ended September 30, 2024, the Company sold 623,526 shares under the 2022 ATM Program for gross proceeds of $11.3 million at a weighted average price of $18.08 per share, generating net proceeds of $11.1 million.

Current wording

*ATM Program.*The Company was not active under the 2022 ATM Program during the three months ended March 31, 2025.

Previous wording

improvements at a property which capital expenditure is expected to be funded within one year. Additionally, the Company is committed to fund five construction loans as described in Note 4, “Commercial Loans and Investments”. The unfunded portion of the construction loans totaled $12.3 million as of September 30, 2024.

Current wording

*Capital Expenditures.*As of March 31, 2025, the Company had no commitments related to capital expenditures for the maintenance of fixed assets, such as land, buildings, and equipment. As of March 31, 2025, the Company is committed to funding $5.0 million in tenant improvements at a property which capital expenditure is expected to be funded within one year. Additionally, the Company is committed to fund six construction loans as described in Note 4, “Commercial Loans and Investments”. The unfunded portion of the construction loans totaled $25.4 million as of March 31, 2025.

Previous wording

We believe we will have sufficient liquidity to fund our operations, capital requirements, maintenance, and debt service requirements over the next twelve months and into the foreseeable future, with cash on hand, cash flow from our operations, proceeds from the completion of the sale of assets utilizing the reverse like-kind 1031 exchange structure, $98.3 million of availability remaining under the 2022 ATM Program, and $53.5 million of available capacity on the existing $250.0 million Credit Facility.

Current wording

We believe we will have sufficient liquidity to fund our operations, capital requirements, maintenance, and debt service requirements over the next twelve months and into the foreseeable future, with cash on hand, cash flow from our operations, proceeds from the completion of the sale of assets utilizing the reverse like-kind 1031 exchange structure, $90.4 million of availability remaining under the 2022 ATM Program, and $56.4 million of available capacity on the existing $250.0 million Credit Facility.

Previous wording

We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income or loss adjusted to exclude real estate related depreciation and amortization, as well as extraordinary items (as defined by GAAP) such as net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and impairments associated with the implementation of current expected credit losses on commercial loans and investments at the time of origination, including the pro rata share of such adjustments of unconsolidated subsidiaries. To derive AFFO, we further modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to non-cash revenues and expenses such as loss on extinguishment of debt, amortization of above- and below-market lease related intangibles, straight-line rental revenue, amortization of deferred financing costs, non-cash compensation, and other non-cash income or expense. Such items may cause short-term fluctuations in net income but have no impact on operating cash flows or long-term operating performance. We use AFFO as one measure of our performance when we formulate corporate goals.

Current wording

We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. NAREIT defines FFO as GAAP net income or loss adjusted to exclude real estate related depreciation and amortization, as well as extraordinary items (as defined by GAAP) such as net gain or loss from sales of depreciable real estate assets, impairment write-downs associated with depreciable real estate assets and impairments associated with the implementation of current expected credit losses on commercial loans and investments at the time of origination, including the pro rata share of such adjustments of unconsolidated subsidiaries. To derive AFFO, we further modify the NAREIT computation of FFO to include other adjustments to GAAP net income related to non-cash revenues and expenses such as loss on extinguishment of debt, amortization of above- and below-market lease related intangibles, straight-line rental revenue, amortization of deferred financing costs, non-cash compensation, and other non-cash adjustments to income or expense. Such items may cause short-term fluctuations in net income but have no impact on operating cash flows or long-term operating performance. We use AFFO as one measure of our performance when we formulate corporate goals.

Previous wording

Purchase Accounting for Acquisitions of Real Estate Subject to a Lease. As required by GAAP, the fair value of the real estate acquired with in-place leases is allocated to the acquired tangible assets, consisting of land, building and tenant improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, the value of in-place leases, and the value of leasing costs, based in each case on their relative fair values. In allocating the fair value of the identified intangible assets and liabilities of an acquired property, above-market and below-market in-place lease values are recorded as other assets or liabilities based on the present value. The assumptions underlying the allocation of relative fair values are based on market information including, but not limited to: (i) the estimate of replacement cost of improvements under the cost approach, (ii) the estimate of land values based on comparable

Current wording

Purchase Accounting for Acquisitions of Real Estate Subject to a Lease. As required by GAAP, the fair value of the real estate acquired with in-place leases is allocated to the acquired tangible assets, consisting of land, building and tenant improvements, and identified intangible assets and liabilities, consisting of the value of above-market and below-market leases, the value of in-place leases, and the value of leasing costs, based in each case on their relative fair values. In allocating the fair value of the identified intangible assets and liabilities of an acquired property, above-market and below-market in-place lease values are recorded as other assets or liabilities based on the present value. The assumptions underlying the allocation of relative fair values are based on market information including, but not limited to: (i) the estimate of replacement cost of improvements under the cost approach, (ii) the estimate of land values based on comparable sales under the sales comparison approach, and (iii) the estimate of future benefits determined by either a reasonable rate of return over a single year’s net cash flow, or a forecast of net cash flows projected over a reasonable investment horizon under the income capitalization approach. The underlying assumptions are subject to uncertainty and thus any changes to the allocation of fair value to each of the various line items within the Company’s consolidated balance sheets could have an impact on the Company’s financial condition as well as results of operations due to resulting changes in depreciation

Previous wording

sales under the sales comparison approach, and (iii) the estimate of future benefits determined by either a reasonable rate of return over a single year’s net cash flow, or a forecast of net cash flows projected over a reasonable investment horizon under the income capitalization approach. The underlying assumptions are subject to uncertainty and thus any changes to the allocation of fair value to each of the various line items within the Company’s consolidated balance sheets could have an impact on the Company’s financial condition as well as results of operations due to resulting changes in depreciation and amortization as a result of the fair value allocation. The acquisitions of real estate subject to this estimate totaled three properties fora combined purchase price of $21.7 million for the nine months ended September 30, 2024 and 12 properties for a combined purchase price of $79.9 million for the nine months ended September 30, 2023.

Current wording

and amortization as a result of the fair value allocation. The acquisitions of real estate subject to this estimate totaled three properties fora combined purchase price of $39.7 million for the three months ended March 31, 2025.