Terra Property Trust, Inc.

We are subject to numerous risks and uncertainties that could cause our actual results and future events to differ materially from those set forth or contemplated in our forward-looking statements, including those summarized below. The following list of risks and uncertainties is only a summary of some of the most important factors and is not intended to be exhaustive. This risk factor summary should be read together with the more detailed discussion of risks and uncertainties set forth under “Risk Factors.”

Risks Related to Owning Our Common Stock

•There is no public market for our common stock and a market may never develop, which could cause our common stock to trade at a discount and make it difficult for holders of our common stock to sell their shares.

•Common stock and preferred stock eligible for future sale may have adverse effects on our share price.

•Our principal stockholders, which are currently controlled by affiliates of our Manager, own a significant amount of our outstanding shares of common stock.

Risks Related to Our Business

•Changes in national, regional or local economic, demographic or real estate market conditions may adversely affect our results of operations, our financial position, the value of our assets and our cash flows.

•Periods of higher inflation in the U.S. may have an adverse impact on the valuation of our investments.

•The lack of liquidity of our assets may adversely affect our business, including our ability to value and sell our assets.

•Our investments are selected by our Manager and our investors will not have input into investment decisions.

•If our Manager underestimates the borrower’s credit analysis or originates loans by using an exception to its loan underwriting guidelines, we may experience losses.

•Changes in interest rates could adversely affect the demand for our target loans, the value of our loans, commercial mortgage-backed securities (“CMBS”) and other real-estate debt or equity assets and the availability and yield on our targeted assets.

•New entrants in the market for commercial loan originations and acquisitions could adversely impact our ability to originate and acquire real estate-related loans at attractive risk-adjusted returns.

•Our loan portfolio may at times be concentrated in certain property types or secured by properties concentrated in a limited number of geographic areas, which increases our exposure to economic downturn with respect to those property types or geographic locations.

•The mezzanine loans, preferred equity and other subordinated loans in which we invest involve greater risks of loss than senior loans secured by income-producing commercial properties.

•Our acquisitions and the integration of acquired businesses subject us to various risks and may not result in all of the cost savings and benefits anticipated, which could adversely affect our financial condition or results of operations.

•The Current Expected Credit Loss (“CECL”) accounting standard requires us to make certain estimates and judgments, which may be difficult to determine and may have a material adverse effect on our financial condition and results of operations.

Risks Related to Regulation

•Maintenance of our 1940 Act exclusion imposes limits on our operations.

•Changes in U.S. tax laws could adversely impact us.

Risks Related to Our Management and Our Relationship With Our Manager

•We rely entirely on the management team and employees of our Manager for our day-to-day operations.

•We face certain conflicts of interest with respect to our operations and our relationship with our Manager and its affiliates.

iv

•The compensation that our Manager receives was not determined on an arm’s-length basis and therefore may not be on the same terms as we could achieve from a third-party.

Risks Related to Financing and Hedging

•Covenants in our debt agreements may restrict our operating activities and adversely affect our financial condition, operating results and cash flows.

•Our inability to access funding could have a material adverse effect on our results of operations, financial condition and business. We may rely on short-term financing and thus are especially exposed to changes in the availability of financing.

•Limited participation in the exchange offers described in the Registration Statement could result in Terra LLC defaulting on the 7.00% Senior Notes Due 2026 that remain outstanding after such exchange offers are completed.

•Limited participation in the exchange offers described in the Registration Statement could result in us defaulting on the 6.00% Senior Notes Due 2026 that remain outstanding after such exchange offers are completed.

Risks Related to Our Organization and Structure

•Rapid changes in the values of our assets may make it more difficult for us to maintain our qualification as a REIT or our exclusion from the 1940 Act.

Risks Related to Our Qualification as a REIT

•Our failure to qualify or remain qualified as a REIT would subject us to U.S. federal income tax and applicable state and local taxes, which would reduce the amount of cash available for principal and interest payments on the notes.

•REIT distribution requirements could adversely affect our ability to execute our business plan and may require us to incur debt or sell assets to make such distributions.

•Complying with the REIT requirements may force us to liquidate or forego otherwise attractive investments.

General Risk Factors

•The future outbreak of highly infectious or contagious diseases, could materially and adversely impact or disrupt our investments, business, financial condition and results of operations.

•Future recessions, downturns, disruptions or instability could have a materially adverse effect on our business.

v

Part I