Sachem Capital Corp.

1. The Company

Sachem Capital Corp. (the “Company”), a New York corporation, specializes in originating, underwriting, funding, servicing and managing a portfolio of first mortgage loans. The Company operates its business asone segment. The Company offers short-term (i.e., one tothree years), secured, non-bank loans to real estate owners and investors to fund their acquisition, renovation, development, rehabilitation or improvement of properties located primarily in the northeastern and southeastern sections of the United States. The properties securing the Company’s loans are generally classified as residential or commercial real estate and, typically, are held for resale or investment. Each loan is typically secured by a first mortgage lien on real estate and may also be secured with additional collateral, such as other real estate owned by the borrower or its principals, a pledge of the ownership interests in the borrower by the principals thereof, and/or personal guarantees by the principals of the borrower. The Company does not lend to owner occupants of residential real estate. The Company’s primary underwriting criteria is a conservative loan to value ratio. In addition, the Company may make opportunistic real estate purchases apart from its lending activities.

Segment Reporting

The Company uses the management approach to determine reportable operating segments. The Company operates through a single operating and reporting segment with an investment objective to generate both current income and capital appreciation through its investments in real estate mortgage loans and real estate. The management approach considers the internal organization and reporting used by the Company’s Chief Executive Officer, whom serves as the chief operating decision maker (“CODM”) for making decisions, allocating resources and assessing performance. The CODM assesses the performance and makes operating decisions of the Company on a consolidated basis primarily based on the Company’s net income. In addition to other factors and metrics, the CODM utilizes net income as a key determinant of the amount of dividends to be distributed to the Company's stockholders.

As the Company’s operations comprise of a single reporting segment, the segment assets are reflected on the accompanying Consolidated Balance Sheets as “total assets” and the significant segment expenses are listed on the accompanying Consolidated Statements of Operations.

2. Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The consolidated financial statements of the Company include the accounts of all subsidiaries in which the Company has control over significant operating, financial and investing decisions of the entity. As of December 31, 2025, the accounts and activities of these subsidiaries were not material to warrant separate disclosure or segment reporting. As a result, the Company has onlyone reportable segment for financial reporting purposes. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates in the Preparation of Consolidated Financial Statements

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management will base the use of estimates on (a) various assumptions that consider prior reporting results, (b) the Company’s projections regarding future operations and (c) general financial market and local and general economic conditions. Actual amounts could differ from those estimates. Significant estimates include the provisions for current expected credit losses, loans held for sale, and real estate owned.

Concentration of Credit Risks

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, investments in securities, investments in limited liability companies, and mortgage loans.

The Company maintains its cash and cash equivalents with various financial institutions. Accounts at the financial institution are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000 per depositor. The Company maintains bank deposits in amounts that may exceed federally insured limits. The Company has not experienced any losses in such accounts.

Concentrations of credit risk related to the loans' geographical location and property type may be affected by changes in economic or other conditions of the particular geographic area or particular asset type that collateralize the Company’s mortgage loans. For further details see Note 4 – Loans and Allowances for Credit Losses.

Credit risks associated with the Company’s mortgage loan portfolio and related interest receivable are described in Note 4 – Loans and Allowance for Credit Losses.

Variable Interest Entities ("VIEs")

VIEs are entities that, by design, either (i) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties; or (ii) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity. The entity that is the primary beneficiary is required to consolidate the VIE. An entity is deemed to be the primary beneficiary of a VIE if the entity has both (i) the power to direct the activities that most significantly impact the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE. In determining whether the Company is the primary beneficiary of a VIE, both qualitative and quantitative factors are considered regarding the nature, size and form of its involvement with the VIE, such as its role establishing the VIE and ongoing rights and responsibilities, the design of the VIE, its economic interests, servicing fees and servicing responsibilities, and other factors. The Company performs ongoing reassessments to evaluate whether changes in the entity’s capital structure or changes in the nature of its involvement with the entity result in a change to the VIE designation or a change to its consolidation conclusion.

On March 20, 2025, the Company formed SN Holdings LLC (“SN Holdings”), a wholly owned subsidiary of the Company, for the sole purpose of acting as the borrower under a new revolving credit facility with Needham Bank. Simultaneously with the execution of the Credit Agreement (defined below), the Company terminated and repaid in full the outstanding balance under its previous credit facility with Needham Bank.

SN Holdings is a VIE under the guidance of FASB ASC 810-10, Consolidation, as it was established with insufficient equity at risk and does not have independent operations apart from the Company. The Company has determined that it is the primary beneficiary of SN Holdings because it has both (i) the power to direct the activities that most significantly impact SN Holdings’ economic performance and (ii) the obligation to absorb losses or the right to receive benefits that could be significant to SN Holdings, primarily through its role as the guarantor of the Needham Credit Facility (defined below) and through its ability to direct all operational and financing decisions. Accordingly, SN Holdings has been consolidated in the Company’s consolidated financial statements.

As of December 31, 2025, SN Holdings had total assets of $88.4 million, consisting primarily of collateralized mortgage loans, and total liabilities of $21.0 million, consisting primarily of borrowings under the Needham Credit Facility. The assets of SN Holdings can only be used to settle obligations of SN Holdings and are not available to the Company or its creditors, other than as permitted under the intercompany guaranty and lien release provisions of the Needham Credit Facility.

On June 11, 2025, Sachem Capital Corporation Holdings, LLC ("Holdings"), an indirect, wholly-owned subsidiary of the Company, consummated a private placement of $100.0 million aggregate principal amount of Senior Secured Notes due June 11, 2030 (the "Senior Secured Notes") to various institutional investors under a Note Purchase and Guaranty Agreement (the "Agreement"). See Note 11 - Secured Notes Payable. Holdings was formed for the sole purpose of acting as the issuer of the Senior Secured Notes.

Holdings is a VIE under the guidance of FASB ASC 810-10 (Consolidation) as it was established with insufficient equity at risk and does not have independent operations apart from the Company. The Company has determined that it is the primary beneficiary of Holdings because it has both (i) the power to direct the activities that most significantly impact

Holdings’ economic performance and (ii) the obligation to absorb losses or the right to receive benefits that could be significant to Holdings, primarily through its role as the guarantor of the Senior Secured Notes and through its ability to direct all operational and financing decisions. Accordingly, Holdings has been consolidated in the Company’s consolidated financial statements.

As of December 31, 2025, Holdings had total assets of $201.8 million, consisting primarily of collateralized mortgage loans, and total liabilities of $93.2 million, consisting primarily of indebtedness evidenced by the Senior Secured Notes. The assets of Holdings can only be used to settle obligations of Holdings and are not available to the Company or its creditors.

Cash and Cash Equivalents

The Company considers all demand deposits, cashier’s checks, money market accounts and certificates of deposit with an original maturity of three months or less to be cash equivalents.

Investment Securities (at fair value)

Debt investments are classified as available-for-sale and realized gains and losses are recorded using the specific identification method. Changes in fair value, excluding credit losses and impairments, are recorded in other comprehensive income (loss). Fair value is calculated based on publicly available market information or other estimates determined by management. If the cost of an investment exceeds its fair value, management evaluates, among other factors, general market conditions, credit quality of debt instrument issuers, and the extent to which the fair value is less than cost. To determine credit losses, management employs a systematic methodology that considers available quantitative and qualitative evidence. In addition, management may consider specific adverse conditions related to the financial health of, and business outlook for, the investee. If the Company plans to sell the security or it is more likely than not that it will be required to sell the security before recovery, then a decline in fair value below cost is recorded as an impairment charge in net income and a new cost basis in the investment is established. If market, industry, and/or investee conditions deteriorate, the Company may incur future losses and/or impairments.

Marketable equity investments with readily determinable fair values are measured at fair value and are classified as trading securities with changes in value recorded in net income.

For the year ended December 31, 2025, the Company recognized gains on investment securities totaling $1.6 million, consisting of $0.8 million in realized gains and $0.8 million in unrealized holding gains. For the year ended December 31, 2024, the Company recognized gains on investment securities totaling $0.2 million, consisting of $1.4 million in realized gains and $1.6 million in unrealized holding losses.

Investment in Limited Liability Companies (“LLCs”)

The Company accounts for its investments in limited liability companies based on the level of ownership, control, and influence in accordance with FASB ASC 323 (Investments – Equity Method and Joint Ventures) and FASB ASC 810 (Consolidation). Investments in LLCs are classified into the following categories based on the Company’s level of influence and control:

1. Fair Value Method (FASB ASC 321) – Passive Investments (Less than 20% Ownership, No Significant

Influence)

◦Investments in LLCs where the Company does not exercise significant influence are accounted for under FASB ASC 321 (Investments – Equity Securities) and recorded at fair value, with changes in fair value recognized in earnings.

◦If fair value is not readily determinable, the Company applies the measurement alternative, recording the investment at cost less impairment, adjusted for observable price changes.

2. Equity Method (FASB ASC 323) – Significant Influence (20% – 50% Ownership)

◦The Company applies the equity method of accounting for investments where it has significant influence over the operating and financial policies of the LLC.

◦Under the equity method, the Company recognizes its proportionate share of the LLC’s net income or loss in earnings and adjusts the carrying amount of the investment accordingly.

◦Distributions received from equity method investments are recorded as a reduction of the investment unless they represent a return on investment, in which case they are recognized as income.

◦The investment is assessed for impairment whenever events or circumstances indicate that the carrying amount may not be recoverable.

3. Consolidation (FASB ASC 810) – Variable Interest Entities (“VIEs”) or Controlling Interest

◦Voting Interest Model: The Company holds greater than 50% of the voting interests and has the power to direct the significant activities of the LLC.

◦Variable Interest Entity (VIE) Model: If the LLC qualifies as a VIE, the Company consolidates the LLC when it is deemed to be the primary beneficiary of the VIE. In accordance with FASB ASC 810, the Company evaluates whether:

1. The LLC is a VIE (i.e., lacks sufficient equity to finance its operations without additional support or the equity holders do not have the power to direct significant activities); and

2. The Company has both: The power to direct the activities of the VIE that most significantly affect its economic performance, and the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant.

When both conditions are met, the Company consolidates the VIE in its consolidated financial statements, including the entity’s assets, liabilities, and operations. Noncontrolling interests in consolidated LLCs, if any, are presented separately within the consolidated financial statements. The Company reassesses its conclusions about VIE status and primary beneficiary determination on an ongoing basis, particularly when events occur that may change the underlying structure or governance of the investee.

For investments accounted for under the equity method or the measurement alternative cost method, the Company evaluates whether indicators of impairment exist. If an investment is determined to be other-than-temporarily impaired, the carrying value is written down to its estimated fair value, with the impairment loss recognized in earnings.

Loans held for investment

Loans that are originated and serviced by the Company, that management has the intent and ability to hold for the foreseeable future, are reported at their outstanding balances, net of an allowance for credit losses and unamortized deferred fees. The net amount of nonrefundable loan origination fees and certain direct costs associated with the lending process are deferred and amortized to fee income over the contractual lives of the loans using the interest method which reflects a constant yield. Interest income on loans is accrued based on the unpaid principal balance outstanding and the contractual terms of the loan agreements.

Loans held for sale

Loans are classified as held for sale if there is an intent to sell in the near-term. These loans are recorded at the lower of amortized cost or fair value. If the fair value of a loan is determined to be less than its amortized cost, a non-recurring fair value adjustment will be recorded through a valuation allowance. When a loan held for investment is transferred into the held for sale category, any previously recorded allowance for credit losses is reversed in the provision for credit losses related to loans and the loan is recorded at its amortized cost basis. If the amortized cost basis exceeds the loan’s fair value at the date of transfer, a valuation allowance equal to the difference between amortized cost basis and fair value is recorded.

Non-accrual loans

A loan is generally placed on non-accrual status when it is probable that principal and interest will not be collected under the original contractual terms. At that time, interest income is no longer accrued. Non-accrual loans consist of loans for which principal or interest has been delinquent for 90 days or more. Interest income is subsequently recognized only to the extent it is received in cash or until the loan qualifies for return to accrual status. Loans are restored to accrual status when contractually current and the collection of future payments is reasonably assured. In certain instances, the Company may make exceptions to placing a loan on non-accrual status if the loan is in the process of modification.

Loan modifications made to borrowers experiencing financial difficulty.

In situations where economic or legal circumstances may cause a borrower to experience significant financial difficulties, the Company may grant concessions for a period of time to the borrower that it would not otherwise consider. These modified terms may include interest rate reductions, principal forgiveness, term extensions, and other-than-insignificant payment delay intended to minimize the Company’s economic loss and to avoid foreclosure or repossession of collateral. The Company monitors the performance of all loans, including loans modified to borrowers experiencing financial difficulty and considers loans that are 90 days past due to be in payment default.

Transfer of Financial Assets

Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets. Transfers of agreements that meet the sale criteria under FASB ASC 860 (Transfers and Servicing) are derecognized from the Consolidated Balance Sheets at the time of transfer. If the transfer of loans does not meet the sale criteria or participating interest criteria under FASB ASC 860, the transfer is accounted for as a secured borrowing and the loan is not derecognized and a participating liability is recorded in the Consolidated Balance Sheets.

Allowance for Credit Losses

The Company records an allowance for credit losses under ASC 326, Financial Instruments—Credit Losses (“CECL”) on the Consolidated Balance Sheets with respect to its loan portfolio, including unfunded construction commitments, on a collective basis by assets with similar risk characteristics. In addition, interest and fees receivable and amounts included in due from borrowers, other than reimbursements, which include origination, modification and other fees receivable, are also analyzed for credit losses in accordance with CECL standard, as they represent a financial asset that is subject to credit risk. As allowed under the CECL standard used by the Company, as a practical expedient, the fair value of the collateral at the reporting date is compared to the net carrying amount of the loan when determining the allowance for credit losses for loans in pending/pre-foreclosure status, as defined. Fair value of collateral is reduced by estimated cost to sell if the collateral is expected to be sold. Such allowances are presented net in “Allowance for credit losses” and “Loans held for sale, net” on the Consolidated Balance Sheets included in the accompanying consolidated financial statements based on their respective classification.

The CECL standard requires an entity to consider historical loss experience, current conditions, and a reasonable and supportable forecast of the economic environment. The Company utilizes a vintage loss-rate method for estimating current expected credit losses. The vintage loss rate method involves applying a vintage loss rate to a pool of loans with similar risk characteristics to estimate the expected credit losses on that pool of loans. In determining the CECL allowance, the Company considers various factors including (1) historical loss experience and unrealized forecasted losses in its portfolio, (2) loan specific losses for loans deemed collateral dependent based on excess amortized cost over the fair value of the underlying collateral, and (3) its current and future view of the macroeconomic environment.

The Company’s estimate of expected credit losses includes a review of charge-off experience factors, contractual delinquency, historical collection rates, the value of underlying collateral and other information to make the necessary judgments as to allowance for credit losses expected in the portfolio as of the reporting date. While management utilizes the best information available to make its evaluations, changes in macroeconomic conditions, interest rate environments, or both, may significantly impact the assumptions and inputs used in determining the allowance for credit losses. The

Company’s charge-off policy is determined by a review of each delinquent loan. The Company has an accounting policy to not place loans on nonaccrual status unless they are more than 90 days delinquent. Accrual of interest income is generally resumed when the delinquent contractual principal and interest is paid in full or when a portion of the delinquent payments are made, and the ongoing required contractual payments have been made for an appropriate period.

In the year ended December 31, 2024, the Company updated its methodology for estimating the CECL factors on its portfolio of financial assets related to loans. This update reflects the Company incorporating its current unrealized losses on individually evaluated loans into its historical loss data, as this change is believed to provide sufficient coverage to forecast estimated expected lifetime losses.

Management estimates the allowance for credit losses using relevant information, from internal and external sources, relating to past events, current conditions and reasonable and supportable forecasts. The allowance for credit losses is maintained at a level sufficient to provide for expected credit losses over the life of the loans based on evaluating historical credit loss experience and to make adjustments to historical loss information for differences in the specific risk characteristics in the current loan portfolio. The “Allowance for credit losses” related to the principal outstanding is presented within “Loans held for investment, net” and for unfunded commitments is within accounts payable and accrued liabilities in the Company’s Consolidated Balance Sheets. The “Allowance for credit losses” related to the late payment fees are presented in “Interest and fees receivable, net”, and “Due from borrowers, net” in the Company’s Consolidated Balance sheets. Lastly, the allowance related to unfunded commitments for construction loans is presented in “Accounts payable and accrued liabilities” on the Company’s Consolidated Balance Sheets.

See Note 4 – Loans and Allowance for Credit Losses - for further details.

Interest and Fees Receivable, Net

Interest and fees receivable includes interest accrued between payment dates on loans and fees charged to borrowers in accordance with the loan agreement. These amounts are reported at their outstanding balances, net of an allowance for credit losses.

Due From Borrowers, Net

Due from borrowers includes amounts paid on behalf of borrowers, such as insurance and property taxes, for which we are due reimbursement from borrowers in accordance with the loan agreement. These amounts are reported at their outstanding balances, net of an allowance for credit losses.

Fair Value Measurements

The framework for measuring fair value provides a fair value hierarchy that prioritizes inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under FASB ASC 820 are described as follows:

Level 1 Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the reporting entity has the ability to access at the measurement date.

Level 2 Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly:

•quoted prices for similar assets or liabilities in active markets;

•quoted prices for identical or similar assets or liabilities in inactive markets;

•inputs other than quoted prices that are observable for the asset or liability; and

•inputs that are derived principally from or corroborated by observable market data by correlation to other means.

If the asset or liability has a specified (i.e., contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

Property and Equipment, Net

Land and building were acquired in 2022 to serve as the Company’s corporate headquarters. The land is carried at cost. The building is stated at cost less accumulated depreciation. The building is being depreciated using the straight-line method over its estimated useful life of 40 years. Furniture and fixtures, computer hardware and software, and vehicles are stated at cost less accumulated depreciation. Depreciation is computed by the straight-line method over the estimated useful lives of the assets. Furniture and fixtures are depreciated using an estimated useful life ofthree tofive years. Computer hardware and software are depreciated using an estimated useful life oftwo tothree years. Vehicles are depreciated using an estimated useful life offive years.

Investment in Developmental Real Estate, Net

Developmental real estate is carried at cost, net of accumulated depreciation and amortization. Betterments, major renewals and certain costs directly related to the improvement and leasing of real estate are capitalized. Maintenance and repairs are expensed as incurred. For redevelopment of existing operating properties, the net book value of the existing property under redevelopment plus the cost for the construction and improvements incurred in connection with the redevelopment, including interest and debt expense, are capitalized to the extent the capitalized costs of the property do not exceed the estimated fair value of the redeveloped property when complete. If the cost of the redeveloped property, including the net book value of the existing property, exceeds the estimated fair value of the redeveloped property, the excess is charged to expense. Depreciation is recognized on a straight-line basis over the estimated useful lives of these assets which range from seven to 40 years. Tenant allowances are amortized on a straight-line basis over the lives of the related leases, which approximate the useful lives of the assets.

Upon the acquisition of real estate, the Company assesses whether the transaction should be accounted for as an asset acquisition or as a business combination. Acquisitions of integrated sets of assets and activities that do not meet the definition of a business are accounted for as asset acquisitions. Acquisitions of real estate generally will not meet the definition of a business because substantially all the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related identified intangible assets).

The Company allocates the purchase price of real estate to land and building (inclusive of site and tenant improvements) and, if determined to be material, intangible assets, such as the value of above- and below-market leases and deferred leasing costs associated with the in-place leases.

The allocation of the purchase price to the tangible and intangible assets acquired and liabilities assumed involves subjectivity as the allocations are based on an analysis of the respective fair values. In determining the fair value of the real estate acquired, the Company utilized a third-party valuation which primarily utilizes cash flow projections that apply, among other things, estimated revenue and expense growth rates, discount rates and capitalization rates, as well as a sales comparison approach, which utilizes comparable sales, listings and sales contracts. The Company assesses the fair value of the leases acquired based on estimated cash flow projections that utilize appropriate discount rates and available market information. Estimates of future cash flows are based on a number of factors including the historical operating results, known trends, and market/economic conditions that may affect the property. The determined and allocated fair values to the real estate acquired will affect the amount of depreciation and amortization the Company records over the respective estimated useful lives or term of the lease.

Real Estate Owned, Net (“REO”)

REO acquired through foreclosure is initially measured at fair value and is thereafter subject to an ongoing impairment analysis. After an REO acquisition, events or circumstances may occur that result in a material and sustained decrease in the cash flows generated from the property or other market indicators including listing data may signal a decline in the liquidation value. REO is evaluated for recoverability when impairment indicators are identified. Any impairment losses or recoveries are included in the Consolidated Statements of Operations.

Impairment of Long-Lived Assets

The Company continually monitors events or changes in circumstances that could indicate the carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances occur, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the undiscounted cash flow is less than the carrying amount of these assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets.

Deferred Financing Costs

Costs incurred in connection with the Company’s revolving credit facilities, described in Note 9 – Lines of Credit, Mortgage Payable Churchill Facility – are amortized over the term of the applicable facility using the straight-line method, which approximates the effective interest.

Costs incurred by the Company in connection with the issuance of unsecured, unsubordinated notes, described in Note 10 – Unsecured Notes Payable, and the senior secured notes payable, described in Note 11 - Senior Secured Notes Payable, are being amortized over the term of the respective unsecured, unsubordinated notes using the effective interest method.

Revenue Recognition

Interest income from the Company’s loan portfolio is recognized under FASB ASC 310 (Receivables)and is earned over the loan period and is calculated using the simple interest method on principal amounts outstanding. Generally, the Company’s loans provide for interest to be paid monthly in arrears. The Company, generally, does not accrue interest income on loans that are more than 90 days past due or interest charged at default rates.

Origination, modification, extension, and construction servicing fee revenue, generally 1% –3% of either the original loan principal or the modified loan balance, is collected at loan funding and is recognized ratably over the contractual life of the loan in accordance with FASB ASC 310 (Receivables).

Debt Obligations

The Company’s debt obligations are carried at amortized cost and are reported net of any debt issuance costs, discounts and premiums. Debt issuance costs, discounts and premiums are amortized to interest expense over the life of the instrument using the effective interest method. Unamortized debt issuance costs, discounts and premiums are written off to net losses on debt extinguishment in the consolidated statements of operations when the Company prepays borrowings prior to maturity.

Advances from Borrowers

The Company utilizes advances from borrowers as interest reserves on certain loans which are applied to future interest payments. Such reserves are established at the time of loan origination. The interest reserve is recorded as a liability as it represents unearned interest revenue. The interest reserve is relieved when the interest on the loan is earned, and interest income is recorded in the period when the interest is earned in accordance with the credit agreement. The interest payment is deducted from the interest reserve deposit balance on the date when the interest payment is due. The decision to establish an interest reserve is made during the underwriting process and considers the creditworthiness and expertise of the borrower, the feasibility of the project, and the debt coverage provided by the real estate and other pledged collateral. It is the Company’s policy to recognize income for this interest component as long as the borrower is progressing as originally projected and if there has been no deterioration in the financial condition of the borrower or the underlying project. The Company’s standard accounting policies for interest income recognition are applied to all loans, including those with interest reserves.

Expenses

Interest expense, in accordance with the Company’s financing agreements, is recorded on an accrual basis. General and administrative expenses, including professional fees, are expensed as incurred.

Stock-Based Compensation

Equity-classified stock awards granted to executive officers, non-employee directors, and employees are measured based on the closing price of the Company's Common Shares on the grant date and recognized on a straight-line basis over the requisite service period of the awards for restricted stock awards.

Income Taxes

The Company believes it qualifies as a real estate investment trust (“REIT”) for federal income tax purposes and operates accordingly. It made the election to be taxed as a REIT on its 2017 Federal income tax return. The Company’s qualification as a REIT depends on its ability to meet on a continuing basis, through actual investment and operating results, various complex requirements under the Internal Revenue Code of 1986, as amended (the “Code”), relating to, among other things, the sources of its income, the composition and values of its assets, its compliance with the distribution requirements applicable to REITs and the diversity of ownership of its outstanding capital stock. So long as it qualifies as a REIT, the Company, generally, will not be subject to U.S. federal income tax on its taxable income distributed to its shareholders. However, if it fails to qualify as a REIT in any taxable year and does not qualify for certain statutory relief provisions, it will be subject to U.S. federal income tax at regular corporate rates and may also be subject to various penalties and may be precluded from re-electing REIT status for the four taxable years following the year during in which it lost its REIT qualification. Other than taxes incurred by the Company’s taxable REIT subsidiary (“TRS”), Sachem Opportunities Corp., the Company does not expect to incur any corporate federal income tax liability outside of the TRS, as it believes it has maintained its qualification as a REIT.

The Company has elected, and may elect in the future, to treat certain of its existing or newly created corporate subsidiaries as TRSs. In general, a TRS may hold assets that the Company cannot hold directly and generally may engage in any real estate or non-real estate related business. TRSs generate income, resulting in federal and state income tax liability for these entities. Accordingly, the Company includes a provision for federal, state and local income taxes in our consolidated financial statements, when applicable. The One Big Beautiful Bill Act, which passed on July 4, 2025, contains legislation increasing the percentage limit under the REIT asset test applicable to TRSs from 20% to 25%. This change applies to taxable years beginning after December 31, 2025.

The Company accounts for deferred income taxes using the asset and liability method and recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in its consolidated financial statements or tax returns. Under this method, the Company determines deferred tax assets and liabilities based on the differences between the financial reporting and tax basis of assets and liabilities using the tax rates in effect for the year in which the differences are expected to reverse. Any increase or decrease in the deferred tax liability that results from a change in circumstances and that causes a change in management's judgment about expected future tax consequences of events, is included in the income tax provision for the period in which such change occurs. Deferred tax assets also reflect net operating loss and tax credit carryforwards. A valuation allowance is provided if the Company believes it is more likely than not that all or some portion of a deferred tax asset will not be realized. Any increase or decrease in the valuation allowance that results from a change in circumstances and that causes a change in management's judgment about the realizability of the related deferred tax asset, is included in the income tax provision for the period in which such change occurs.

FASB ASC 740-10 (Accounting for Uncertainty in Income Taxes) prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and disclosure required. Under this standard, an entity may only recognize or continue to recognize tax positions that meet a “more likely than not” threshold. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in interest expense.

Earnings (Losses) Per Share

Basic and diluted earnings (losses) per share are calculated in accordance with FASB ASC 260 (Earnings Per Share). Under FASB ASC 260, basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares, $0.001 par value per share, (“Common Shares”) outstanding for the period. The computation of diluted earnings (losses) per share is similar to basic earnings (losses) per share, except that the denominator is increased to include the potential dilution from the Company's unvested restricted stock awards, that contain non-forfeitable rights to dividends so therefore deemed to participating, for Common Shares using the treasury stock method. The numerator in calculating both basic and diluted earnings (losses) per common share for each period is the reported net income (loss).

Recent Accounting Pronouncements Pending Adoption

In November 2024, the FASB issued Accounting Standards Update ("ASU") 2024-03, “Income Statement – Reporting Comprehensive Income (FASB ASC 220-40): Expense Disaggregation Disclosures” (“ASU 2024-03”). ASU 2024-03 requires additional disclosure in the notes to the financial statements of specified information about certain costs and expenses. The ASU is effective in reporting periods beginning after December 15, 2026, and interim periods within annual periods beginning after December 15, 2027, on a prospective or retrospective basis. Early adoption is permitted, and the Company is currently assessing the impact upon adoption of this standard on the consolidated financial statements.

Management does not believe that any other recently issued, but not yet effective, accounting standards if currently adopted, would have a material effect on the Company’s consolidated financial statements.

Reclassifications

Certain amounts included in the Company’s December 31, 2024 consolidated statement of operations have been reclassified to conform to the December 31, 2025 presentation. These reclassifications had no effect on the year ended December 31, 2024 net loss.

3. Fair Value Measurement

The Company uses estimated of fair value in applying various accounting standards for its consolidated financial statements on either a recurring or non-recurring basis. Fair value is defined as the price to sell an asset or transfer a liability in an orderly transaction between willing and able market participants. The Company groups its assets and liabilities measured at fair value in three hierarchy levels, based on the observability and transparency of the inputs.

A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below.

The following table presents assets and liabilities measured at fair value on a recurring basis:

Certain assets are measured at fair value on a nonrecurring basis; that is, not measured at fair value on an on going basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment.)The following table presents assets and liabilities measured at fair value on a nonrecurring basis:

Carrying amounts and fair values of financial instruments that are not carried at fair value at December 31, 2025 and December 31, 2024 in the Consolidated Balance Sheets are as follows:

Following is a description of the methodologies used for assets and liabilities measured at fair value:

Stocks and ETFs (Level 1): Valued at the closing price reported in the active market in which the individual securities are traded.

Mutual funds (Level 1): Valued at the daily closing price reported by the fund. Mutual funds held by the Company are open-end mutual funds that are registered with the U.S. Securities and Exchange Commission. These funds are required to publish their daily net asset values and to transact at that price. The mutual funds held by the Company are deemed to be actively traded.

Debt securities: Valued at the closing price reported in the active market in which the individual securities are traded.

Preferred/Fixed rate cap securities: The company classifies preferred/fixed rate cap securities as Level 2 in the fair value hierarchy because their fair value is determined using observable inputs such as interest rates and credit spreads. These inputs are based on market data or pricing models rather than quoted prices for identical assets. Since the securities are not actively traded, the company uses observable inputs to estimate their value, making Level 2 the appropriate classification.

Loans held for investment and related interest and fees receivables and due from/advances from borrowers: The fair value of mortgage loans held for investment and related receivable/liability balances is based on credit risk and discount rates that are not observable in the marketplace and therefore represents a Level 3 measurement.

Loans held for sale: The fair value of loans held for sale is determined by the lower of cost or market approach, where cost represents the carrying value of the loans, and market represents the fair value derived from a collateral analysis. Since this analysis involves significant judgment, including assumptions regarding the value of underlying collateral and potential recovery, it constitutes a Level 3 measurement. These assumptions are not readily observable in the market and require significant management estimation.

Individually evaluated loans, net of allowance for credit losses: This category consists of loans that were individually evaluated for credit losses, net of the related allowance for credit losses, and have been classified as Level 3 assets. All of the Company’s individually evaluated loans for 2025 and 2024, whether reporting a specific allowance allocation or not, are considered collateral-dependent. The Company utilized Level 3 inputs such as independent appraisals of the underlying collateral, which generally includes various Level 3 inputs which are not observable. Appraisals may be adjusted downward by management for qualitative factors such as economic conditions and estimated liquidation expenses. The Company estimates liquidation as a selling cost percentage in connection with the asset, which typically ranges from 1-8%. Please note this category is inclusive of foreclosed loans not held for sale, and is included in loans held for investment.

Real estate owned, net: Real estate owned, net, is classified as a Level 3 asset in the fair value hierarchy due to the significant use of unobservable inputs in determining its fair value. These unobservable inputs typically include estimates based on management’s judgment, such as the anticipated market value, property condition, location, and projected income potential. The Company may adjust such values downward for qualitative factors such as economic conditions and estimated liquidation expenses. The Company estimates liquidation as a selling cost percentage in connection with the asset, which typically ranges from 1%-8%. As no active markets or observable inputs exist for these assets, the valuation process involves a higher degree of subjectivity and relies on internal assumptions, appraisals, and models that are not directly observable.

Investments in Limited Liability Companies (LLCs): The Company holds noncontrolling interests in various LLCs accounted for using the measurement alternative under FASB ASC 321. These investments are carried at cost, less impairment, and adjusted for observable price changes.

Fixed rate debt: Publicly traded fixed rate debt is classified as Level 1 and its fair value is based on quoted prices for similar instruments or calculated utilizing model derived valuations in which significant inputs are observable in active markets. Private senior secured fixed rate debt is estimated using a discounted cash flow model based on the contractual coupon rate and a market yield assumption derived from observed yields on the Company’s publicly traded unsecured notes adjusted for secured credit spread.

Variable rate debt: Variable rate debt is classified as Level 2 and the fair values of our borrowings under our revolving credit facility and other variable rate debt are reasonably estimated at their notional amounts due to the predominance of floating interest rates, which generally reflect market conditions.

Mortgage payable: Mortgage payable is classified as Level 3 and the fair value of our borrowings are primarily based on unobservable inputs that effect the Company’s own assumptions about the factors that market participants would use in pricing the mortgage. The mortgage payable does not have a quoted market price in an active market, and significant inputs such as the interest rate, the probability of default, and the estimated repayment terms are not readily observable in the market.

4. Loans and Allowance for Credit Losses

Loans include loans held for investment that are accounted for at amortized cost net of allowance for credit losses and loans held for sale that are accounted for at the lower of cost or market net of a valuation allowance. The classification for a loan is based on management’s strategy for the loan.

Loans held for investment

The Company offers secured, non-bank loans to real estate owners and investors to fund their acquisition, renovation, development, rehabilitation or improvement of properties located primarily in Connecticut, New York, Massachusetts and Florida. The Company’s lending standards typically require that the original principal amount of all mortgage receivable notes be secured by first mortgage liens on one or more properties owned by the borrower or related parties and that the maximum loan-to-value ("LTV") be no greater than 70% of the appraised value of the underlying collateral, as determined by an independent appraiser at the time of the loan origination. The Company considers the maximum LTV as an indicator of credit risk of a mortgage note receivable. In the case of properties undergoing renovation, the LTV ratio is calculated based on the estimated fair market value of the property after the renovations have been completed. However, the Company makes exceptions to this guideline if the facts and circumstances support the incremental risk. These factors include the additional collateral provided by the borrower, the credit profile of the borrower, the Company’s previous relationship, if any, with the borrower, the nature of the property, the geographic market in which the property is located and any other information the Company deems appropriate.The loans are generally for a term ofone tothree years. Most of the loans provide for monthly payments of interest only (in arrears) during the term of the loan and a balloon payment of the principal at maturity.

As of December 31, 2025, and 2024, the Company had 115 and 157 loans held for investment, respectively.

Loans held for sale

The Company offers mortgage notes receivable to be sold in real estate capital markets. The Company does not originate loans for the use of loans held for sale, as these loans were a part of a non-recurring event of being transferred from loans held for investment to loans held for sale. As of December 31, 2024, the Company maintained 11 loans held for sale with a gross outstanding principal balance of $15.9 million, of which had an aggregate valuation allowance of $4.9 million in connection with pricing based on lower of cost or market. As of December 31, 2024, such loans were on nonaccrual status and in pending/pre-foreclosure. There wereno such loans held for sale as of December 31, 2025 asthree loans were sold, one loan was transferred to real estate owned, andseven loans were transferred back to loans held for investment during the year ended December 31, 2025.

Loan Sale

In October 2024, the Company initiated the proposed sale of a pool of mortgage loans. A majority of these loans were classified as “non-accrual,” meaning payments of interest owed are more than 90 days overdue. In December 2024, the Company entered into certain Purchase and Sale Agreements with three third party purchasers related to certain non-performing loans that were held for sale. The Company accounted for the transfer of financial assets as a sale, recognizing a loss on sale of $22.0 million, with total net cash proceeds from the sale of $36.1 million and the derecognition of loans held for sale of $55.8 million. The Company has no continuing involvement with the transferred loan assets after the date of transfer and did not retain any interest in the transferred assets. The loans were sold to the purchasers without recourse. In connection with the sale, the Company incurred a loss of $19.7 million on principal and $2.3 million on charges due from such loans, which is presented on the consolidated statement of operations in loss on sale of loans. During the sale process, the Company removed $15.9 million of loans that were initially included in the sale, and these remained as loans held for sale at December 31, 2024 as noted above.

Loan portfolio

As of December 31, 2025, and 2024, loans held for investment on nonaccrual status had an outstanding principal balance of $117.6 million and $87.1 million, respectively. The nonaccrual loans are inclusive of loans pending foreclosure and loans held for sale. For the year ended December 31, 2025 and 2024, $0.4 million and $0.7 million of interest income was recorded on nonaccrual loans due to payments received, respectively. As of December 31, 2025, and 2024, the

Company had direct reserves on outstanding principal of $6.3 million and $13.3 million, respectively. The below table summarizes the Company’s loans held for investment gross principal balance by the past due status:

There are no greater than 90 days past due loans that are on accrual status as of December 31, 2025 and 2024. As of December 31, 2025 and 2024, there were loans greater than 90 days past due with gross principal balances of $96.8 million and $30.9 million, respectively, for which no specific allowance for credit losses on principal was recorded.

For the years ended December 31, 2025 and 2024, the aggregate amounts of loans funded by the Company were $151.8 million and $134.3 million, respectively, offset by principal repayments of $140.2 million and $191.0 million, respectively.

The aggregate gross outstanding principal of loans in pending/pre-foreclosure as of December 31, 2025, and 2024, was $37.5 million and $36.3 million, respectively. As of December 31, 2025, and 2024, the Company had directly reserved against these loans in foreclosure in the amounts of $4.2 million and $6.1 million, respectively. Further, the Company had direct reserves against non-performing loans held for investment that experienced declines in fair value of $2.1 million and $7.3 million, respectively. As of December 31, 2025 and 2024, the aggregate outstanding principal amount of non-performing loans held for investment with direct allowances was $20.8 million and $57.8 million, respectively.

As of December 31, 2025, the Company’s mortgage loan portfolio includes loans with stated interest rates ranging from 7.0% to 15.0%. The default interest rate is generally 18% but could be more or less depending on state usury laws and other considerations deemed relevant by the Company.

As of December 31, 2025 and 2024, the Company hadone borrower representing 13.3% and 14.0% of the outstanding mortgage loan portfolio, or $50.4 million and $55.0 million, respectively.

Deferred loan fees

As of December 31, 2025 and 2024, the Company had $2.0 million and $2.0 million of deferred loan fee revenue relating to loans held for investment, respectively. There wereno such deferred fees for loans held for sale as of December 31, 2025 and 2024. In-line with the Company’s accounting policy for revenue recognition, origination, modification, extension and construction servicing fee revenue is collected at loan funding and is recognized ratably over the contractual life of the loan in accordance with FASB ASC 310 (Receivables). In accordance with FASB ASC 310-20-45-1, the Company has presented deferred loan fees net of the related loan balance on its Consolidated Balance Sheets. This presentation reflects the net amount of revenue that is expected to be recognized after considering the outstanding loan balance associated with certain customer arrangements. This presentation aligns with the guidance in FASB ASC 310-20, which permits the net presentation of loan balances with deferred loan fees when the loan is associated with the future performance obligations of the Company. The loan is considered an integral part of the transaction, and as such, the net amount more accurately reflects the remaining obligations of the Company to the customer, as well as the revenue to be recognized.

The Company may agree to extend the term of a loan if, at the time of the extension, the loan and the borrower meet all the Company’s underwriting requirements. The Company treats a loan extension as a new loan. If an interest reserve is established at the time a loan is funded, accrued interest is paid out of the interest reserve and recognized as interest income at the end of each month. If no reserve is established, the borrower is required to pay the interest monthly from its own funds. The deferred origination, loan servicing and amendment fee income represents amounts that will be recognized over the contractual life of the underlying mortgage notes receivable.

Allowance for credit loss

The below table represents the financial statement line items that are impacted by the allowance for credit losses for the year ended December 31, 2025:

The below table represents the financial statement line items that are impacted by the allowance for credit losses for the year ended December 31, 2024:

Recoveries for the years ended December 31, 2025 and 2024 were de minimis.

The following table summarizes the activity in the loans held for investment allowance for credit losses for the year ended December 31, 2025:

The following table summarizes the activity in the loans held for investment allowance for credit losses for the year ended December 31, 2024:

The following table presents charge-offs by fiscal year of origination during the year ended December 31, 2025:

Presented below is the Company’s loans held for investment portfolio by geographical location:

The following tables allocate the gross principal balance of the Company’s loans held for investment portfolio based on credit quality indicators in assessing estimated credit losses and vintage of origination at the dates indicated:

(1)Represents the year of origination or amendment where the loan was subject to a full re-underwriting.

(2)The FICO Scores are calculated at the inception of the loan and are updated if the loan is modified or on an as needed basis.

(1)Represents the year of origination or amendment where the loan was subject to a full re-underwriting.

(2)The FICO Scores are calculated at the inception of a loan and are updated if the loan is modified or on an as needed basis.

The following table presents the amortized cost of collateral dependent loans:

Loan modifications made to borrowers experiencing financial difficulty

In certain situations, the Company may provide loan modifications to borrowers experiencing financial difficulty. These modifications may include term extensions, and adding unpaid interest, charges and taxes to the principal balance intended to minimize the Company’s economic loss and to avoid foreclosure or repossession of collateral. The Company generally receives additional collateral as part of extending the terms of the loan for borrowers experiencing financial difficulty.

The Company monitors the performance of loans modified to borrowers experiencing financial difficulty. The Company considers loans that are 90 days past due to be in payment default.

The table below presents loan modifications made to borrowers experiencing financial difficulty during the year ended December 31, 2025:

The Company monitors the performance of loans modified to borrowers experiencing financial difficulty. The table below presents the performance of loans that have been modified during the year ended December 31, 2025 to borrowers experiencing financial difficulty. The Company considers loans that are 90 days past due to be in payment default.

The Company has committed to lend additional amounts totaling approximately $4.5 million to borrowers experiencing financial difficulty. Of the loans that were modified that experienced financial difficulties during the year ended December 31, 2025, one loan defaulted within 12 months of the modification. This loan had an aggregate outstanding balance of $0.4 million which represented 0.1% of the portfolio. Of the loans that were modified that experienced financial difficulties during the year ended December 31, 2025, ten loans with an outstanding principal balance of $31.9 million, experienced rate decreases due to the modification. The change in the rate was taking the loans off default rate.

The table below presents loan modifications made to borrowers experiencing financial difficulty during the year ended December 31, 2024:

The Company monitors the performance of loans modified to borrowers experiencing financial difficulty. The table below presents the performance of loans that have been modified during the year ended December 31, 2024 to borrowers experiencing financial difficulty. The Company considers loans that are 90 days past due to be in payment default.

As of December 31, 2024, the Company had committed to lend additional amounts totaling approximately $10.8 million to borrowers experiencing financial difficulty. Of the loans that were modified that experienced financial difficulties during the year ended December 31, 2024, six loans defaulted within 12 months of the modification. These loans had an outstanding balance of $5.7 million, which represented 1.6% of the portfolio. Of the loans that were modified that experienced financial difficulties during the year ended December 31, 2024, ten loans with an aggregate outstanding principal balance of $12.2 million, experienced rate decreases due to the modification. The change in the rate was taking the loans off default rate.

5. Investment in Developmental Real Estate, net

For the years ended December 31, 2025 and 2024, investment in rental real estate, net consisted of the following:

Building, land improvements, and site improvements are being depreciated using the straight-line method over their estimated useful lives of 40 years,15 years and 15 years, respectively. Tenant improvements are amortized over the life of the respective lease using the straight-line method. Lease in-place intangible assets, deferred leasing costs and acquired below-market leases are amortized on a straight-line basis over the respective life of the lease. For the year ended December 31, 2025 and 2024, depreciation and amortization related to the asset was $0.1 million, which is presented in “Other expenses” on the Company’s Consolidated Statements of Operations.

Additionally, the Company leased space to a tenant under an operating lease atone developmental real estate property acquired in 2023. The lease provided for the payment of fixed base rent payable monthly in advance and periodic step-ups in rent over the term of the lease and a pass through to tenants their share of increases in real estate taxes and operating expenses over a base year. The lease also provided for free rent and a tenant improvement allowance of $2.7 million. The lease commenced February 2025 with a cash rent abatement period of 425 days. On December 31, 2025, the Company sold this property and recognized a gain of $4.0 million, which is presented in the Company's Consolidated Statements of Operations.

6. Real Estate Owned (REO), net

Property acquired through foreclosure are included on the Consolidated Balance Sheets as real estate owned and further categorized as held for sale or held for rental, described in detail below.

As of December 31, 2025, and 2024, REO, net totaled $16.4 million and $18.6 million, respectively. During the year ended December 31, 2025, the Company’s REO portfolio recorded an impairment loss of $1.1 million compared to an impairment loss of $0.5 million in 2024.

The following table presents the Company’s REO as of December 31, 2025 and 2024:

As of December 31, 2025, REO included $0.8 million of real estate held for rental and $15.6 million of real estate held for sale. As of December 31, 2024, REO included $0.8 million of real estate held for rental and $17.8 million of real estate held for sale.

Properties Held for Sale

During the year ended December 31, 2025, the Company sold fifteen properties held for sale and recognized a de minimis gain. During the year ended December 31, 2024, the Company sold seven properties held for sale and recognized an aggregate gain of $0.4 million. Such gains are included in, “Gain (loss) on sale of investments in developmental real estate, real estate owned, and property and equipment, net” on the Company’s Consolidated Statements of Operations.

Properties Held for Rental

As of December 31, 2025, one property, a commercial building, was held for rental. The tenant signed a 5-year lease that commenced on August 1, 2021. As of December 31, 2025, future minimum rent payments under this lease total $31,000 through maturity on July 31, 2026.

7. Property and Equipment, net

The following table represents the Company’s property and equipment, net as of December 31, 2025 and 2024:

8. Other Assets

As of December 31, 2025, and 2024, other assets consist of the following:

9. Line of Credit, Mortgage Payable, and Churchill Facility

Line of Credit – Needham Bank

The Company has a Credit and Security Agreement (the “Credit Agreement”), with Needham Bank, a Massachusetts co-operative bank, as the administrative agent (“Needham”) for the lenders party thereto (the “Lenders”) with respect to a committed $50.0 million revolving credit facility (the “Needham Credit Facility”), subject to borrowing based limitations and facility covenant compliance. Under the agreement the borrower is SN Holdings LLC, a Connecticut limited liability company formed and wholly owned by Sachem Capital Corp. for the sole purpose of acting as the borrower under the new agreement. Sachem Capital Corp. is the guarantor of all SN Holdings’ obligations under the agreement. SN Holdings, in its capacity as borrower, has granted Needham a lien on all its assets. SN Holdings is required to maintain assets equal to 2.0 times of the outstanding balance on the new credit facility. In addition, SN Holdings is required to collaterally assign to Needham mortgage loans having an outstanding principal balance in an amount no less than the greater of (i) $30.0 million and (ii) the aggregate principal outstanding principal balance on the facility. Sachem Capital Corp., in its capacity as guarantor, has agreed to grant Needham a blanket lien on all its assets. However, Needham is required to release its lien at Sachem’s request to facilitate other financing at the Sachem Capital Corp. and subsidiaries level.

Loans under the Needham Credit Facility accrue interest at the greater of (i) the annual rate of interest equal to the “prime rate,” as published in the “Money Rates” column of The Wall Street Journal minus one-quarter of one percent (0.25%), and (ii) four and one-half percent (4.50%). All amounts borrowed under the Needham Credit Facility are secured by a first priority lien on virtually all of the Company’s assets. Assets excluded from the lien include real estate owned by the Company (other than real estate acquired pursuant to foreclosure) and mortgages sold under the Churchill Facility (as defined below). Prior to Amendment No.2 (defined below), the Needham Credit Facility was due to expire on March 2, 2026 and the Company had a right to extend the term forone year upon the consent of Needham and the Lenders, which consent could not be unreasonably withheld, and so long as it is not in default and satisfies certain other conditions. On January 21, 2026, the Company entered into Amendment No. 2 (“Amendment No. 2”) to the Credit Agreement Amendment No. 2 extends the maturity date of the Needham Credit Facility from March 2, 2026 to March 2, 2028 and provides for an additional conditionalone year extension to March 2, 2029. All other terms of the Credit Agreement remain unchanged.

All outstanding revolving loans and accrued but unpaid interest is due and payable on the expiration date. The Company may terminate the Needham Credit Facility at any time without premium or penalty by delivering written notice to Needham at least ten (10) days prior to the proposed date of termination. The Needham Credit Facility is subject to other terms and conditions, including representations and warranties, covenants and agreements typically found in these types of financing arrangements, including a covenant that requires the Company to maintain: (A) a ratio of Adjusted EBITDA (as defined in the Credit Agreement) to Debt Service (as defined in the Credit Agreement) of not less than 1.40 to 1.0, tested on a trailing-twelve-month basis at the end of each fiscal quarter; (B) a sum of cash, cash equivalents and availability under the facility equal to or greater than $10.0 million; and (C) an asset coverage ratio of at least 150%.

As of December 31, 2025 and 2024, the total outstanding principal balance on the Needham Credit Facility was $19.0 million and $40.0 million, respectively, with an interest rate of 6.50% and 7.25%, respectively.

As of December 31, 2025, the Company was in compliance with all debt covenants.

Mortgage Payable

On February 28, 2023, the Company entered into an adjustable-rate mortgage loan with New Haven Bank in the original principal amount of $1.66 million (the "NHB Mortgage"). The NHB Mortgage accrues interest at an initial rate of 5.75% per annum for the first 60 months. The interest rate will be adjusted on each of March 1, 2028, and March 1, 2033, to the then published 5-year Federal Home Loan Bank of Boston Classic Advance Rate, plus 1.75%. Beginning on April 1, 2023, and through March 1, 2038, principal and interest will be due and payable on a monthly basis. All payments under the loan are amortized based on a 20-year amortization schedule. Over the next five years, the Company is scheduled to make principal payments ranging from 47,000 to $59,000 annually, with the remaining balance due thereafter. The unpaid principal amount of the loan and all accrued and unpaid interest are due and payable in full on March 1, 2038. The loan is a non-recourse obligation, secured by a first mortgage lien on the property located at 568 East Main Street, Branford, Connecticut.

As of December 31, 2025 and 2024, the total outstanding principal balance on the NHB Mortgage was $0.9 million and $1.0 million, respectively.

Churchill MRA Funding I LLC Repurchase Financing Facility

On July 21, 2021, the Company consummated a $200 million master repurchase financing facility (“Churchill Facility”) with Churchill MRA Funding I LLC (“Churchill”), a subsidiary of Churchill Real Estate, a vertically integrated real estate finance company based in New York, New York. Under the terms of the Churchill Facility, the Company had the right, but not the obligation, to sell mortgage loans to Churchill, and Churchill had the right, but not the obligation, to purchase those loans. In addition, the Company had the right and, in some instances the obligation, to repurchase those loans from Churchill. The amount that Churchill would pay for each mortgage loan it purchased varied based on the attributes of the loan and various other factors. The repurchase price was calculated by applying an interest factor, as defined, to the purchase price of the mortgage loan. The Company had also pledged the mortgage loans sold to Churchill to secure its repurchase obligation. The cost of capital under the Churchill Facility was equal to the sum of (a) the greater of (i)0.25% and (ii) the 90-day SOFR (which replaced the 90-day LIBOR) plus (b)3%-4%, depending on the aggregate principal amount of the mortgage loans held by Churchill at that time. As of December 31, 2024, the effective interest rate charged under the facility was 8.69%. In December 2025, all parties mutually agreed to terminate the Churchill Facility which had previously been repaid in full during the fourth quarter of 2025.

The Churchill Facility was subject to other terms and conditions, including representations and warranties, covenants and agreements typically found in these types of financing arrangements. Under one such covenant, the Company (A) was prohibited from (i) paying any dividends or making distributions in excess of 90% of its taxable income, (ii) incurring any indebtedness or (iii) purchasing any of its capital stock, unless, it has an asset coverage ratio of at least 150%; and (B) had to maintain unencumbered cash and cash equivalents in an amount equal to or greater than 2.50% of the amount of its repurchase obligations. Churchill had the right to terminate the Churchill Facility at any time upon 180 days prior notice to the Company. The Company then had an additional 180 days after termination to repurchase all the mortgage loans held by Churchill.

The following table summarizes the outstanding balances under the Churchill Facility agreement:

The following table summarizes loans held for investment pledged as collateral under the Churchill Facility agreement:

The following table summarizes the contractual maturities for loans held for investment sold under the repurchase agreement:

The NHB Mortgage and the Churchill Facility contained cross-default provisions.

10. Unsecured Notes Payable

At December 31, 2025, the Company had an aggregate of $171.3 million of unsecured, unsubordinated notes payable outstanding, net of $1.9 million of deferred financing costs (collectively, the “Notes”).

(i)Notes having an aggregate principal amount of $51.8 million bearing interest at 6.0% per annum and maturing December 30, 2026 (the “December 2026 Notes”);

(ii)Notes having an aggregate principal amount of $51.7 million bearing interest at 6.0% per annum and maturing March 30, 2027 (the “March 2027 Notes”);

(iii)Notes having an aggregate principal amount of $29.7 million bearing interest at 7.125% per annum and maturing June 30, 2027 (the “June 2027 Notes”); and

(iv)Notes having an aggregate principal amount of $40.1 million bearing interest at 8.00% per annum and maturing September 30, 2027 (the “September 2027 Notes”).

The Notes were sold in underwritten public offerings, were issued in denomination of $25.00 each and are listed on the NYSE American and trade under the symbols “SCCD,” “SCCE,” “SCCF” and “SCCG,” respectively. All the Notes were issued at par. Interest on the Notes is payable quarterly on each March 30, June 30, September 30 and December 30 that they are outstanding. So long as the Notes are outstanding, the Company is prohibited from making distributions in excess of 90% of its taxable income, incurring any additional indebtedness or purchasing any shares of its capital stock unless it has an “Asset Coverage Ratio” of at least 150% after giving effect to the payment of such dividend, the incurrence of such indebtedness or the application of the net proceeds, as the case may be. The Company may redeem the Notes, in whole or in part, without premium or penalty, at any time after their second anniversary of issuance upon at least 30 days prior written notice to the holders of the Notes. The redemption price will be equal to the outstanding principal amount of the Notes redeemed plus the accrued but unpaid interest thereon up to, but not including the date of redemption. Currently, all the Notes are callable at any time.

The following are the future principal payments on the notes payable as of December 31, 2025:

The estimated amortization of the deferred financing costs as of December 31, 2025 is as follows:

11. Senior Secured Notes Payable

On June 11, 2025, Holdings, an indirect, wholly-owned subsidiary of the Company, consummated a private placement of $100.0 million aggregate principal amount of Senior Secured Notes due June 11, 2030 (the "Senior Secured Notes") to various institutional investors under a Note Purchase and Guaranty Agreement (the "Senior Secured Note Purchase Agreement"). An initial draw of $50.0 million was made at closing, an additional draw of $40.0 million was made in September 2025, and the remaining $10.0 million may be drawn at any time on or prior to May 15, 2026. The Senior Secured Notes bear interest at a fixed rate of 9.875% per annum, with interest only payable quarterly on the 1st day of March, June, September and December, and include a commitment fee of 1.0% on the undrawn portion of the Senior Secured Notes. The Company paid an approximately $1.5 million original issue discount on the $100.0 million aggregate principal amount which is part of the $3.6 million of deferred financing costs recorded related to the Senior Secured Notes. The deferred financing costs will be amortized over thefive year term of the Senior Secured Notes using the effective interest method and amortization by year is as follows: 2025 - $164,000, 2026 - $609,000, 2027 - $718,000, 2028 - $804,000, 2029 - $894,000, and 2030 - $401,000.

The Senior Secured Notes allow optional prepayment subject to a declining make-whole amount during the first three years, a declining prepayment premium in the fourth year, and then no make-whole payment or prepayment premium after the fourth year through maturity. Upon a change of control, holders of the Senior Secured Notes have the right to prepayment, if accepted, at 101% of the outstanding principal. The Senior Secured Note Purchase Agreement contains affirmative and negative covenants customary for similar secured debt instruments, including minimum asset coverage ratio; leverage and liquidity requirements; restrictions on additional indebtedness, asset sales, and distributions under certain conditions; and maintenance of REIT status by the Company. The Company was in compliance with all debt covenants as of December 31, 2025.

The Senior Secured Note Purchase Agreement includes customary events for similar secured debt instruments. Payment of the amounts due on the Senior Secured Notes is fully and unconditionally guaranteed by the Company and Sachem Capital Corporation Intermediate, LLC, a wholly-owned subsidiary of the Company.

12. Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities include the following:

13. Fee Income from Loans

For the years ended December 31, 2025 and 2024, fee income from loans consists of the following:

14. Commitments and Contingencies

Unfunded Commitments

At December 31, 2025, the Company had future funding obligations on loans held for investment totaling $37.2 million and obligations relating to investments in limited liability companies totaling $1.4 million, which can be drawn by the borrowers when the conditions relating thereto have been satisfied. The unfunded commitments will be funded from loan payoffs and additional drawdowns under existing and future credit facilities and proceeds from sale of debt and equity securities. The Company’s unfunded commitments are subject to allowances under the scope of CECL, see Note 4 – Loans and Allowance for Credit Losses — for further details.

Litigation

The Company is subject to various pending and threatened legal proceedings or other matters arising out of the normal conduct of business in which claims for monetary damages are asserted. As of the date of this report, management, after consultation with legal counsel, does not anticipate that the aggregate ultimate liability arising out of such pending or threatened matters will be material to the Company’s consolidated financial position. On at least a quarterly basis, the Company assesses its liabilities and contingencies in connection with such matters. For those matters where it is probable that the Company will incur losses and the amounts of the losses can be reasonably estimated, the Company records an expense and corresponding liability in its consolidated financial statements. To the extent such matters could result in exposure in excess of that liability, the amount of such excess is not currently estimable. The range of losses for matters where an exposure is not currently estimable or considered probable is not believed to be material in the aggregate. This is based on information currently available to the Company and involves elements of judgment and significant uncertainties. While the Company does not believe that the outcome of pending or threatened litigation or other matters will be material to the Company’s consolidated financial position, it cannot rule out the possibility that such outcomes will be material to the consolidated results of operations for a particular reporting period in the future. In addition, regardless of the ultimate outcome of any such legal proceeding, inquiry or investigation, any such matter could cause the Company to incur additional expenses, which could be significant, and possibly material, to the Company’s results of operations in any future period.

Other

In the normal course of its business, the Company is named as a party-defendant in connection with tax foreclosure proceedings against properties on which it holds a first mortgage lien. The Company actively monitors these actions and, in all cases, believes there remains sufficient value in the subject property to assure that no loan impairment exists. At December 31, 2025, there wasone such property with an unpaid principal balance of $0.3 million. At December 31, 2024, there weretwo such property with an aggregate unpaid principal balance of $1.9 million.

15. Related Party Transactions

In the ordinary course of business, the Company may originate, fund, manage and service loans to shareholders. The underwriting process on these loans adheres to prevailing Company policy. The terms of such loans, including the interest rate, income, origination fees and other closing costs, are the same as those applicable to loans made to unrelated third parties in the portfolio. As of December 31, 2025, and 2024, loans to known shareholders totaled $17.2 million, which is included in loans held for investment, net in the Company’s accompanying Consolidated Balance Sheets. As of December 31, 2025, and 2024, $17.2 million and $17.0 million, respectively, related to Mod 21, LLC, which is a wholly owned entity of the Company’s Senior Vice President of Asset Management and Vice President of Asset Management. All of such loans are performing, and interest income earned on all related party loans for the years ended December 31, 2025 and 2024 totaled $1.1 million and $1.4 million, respectively.

In December 2022, the Company hired the daughter of the Company’s Chief Executive Officer to perform certain internal audit and compliance services. For the years ended December 31, 2025 and 2024, she received compensation of $0.2 million and $0.2 million, respectively.

16. Stock-Based Compensation and Employee Benefits

Stock-Based Compensation

On October 27, 2016, the Company adopted the 2016 Equity Compensation Plan (the “Plan”), the purpose of which is to align the interests of the Company’s officers, other employees, advisors and consultants or any subsidiary, if any, with those of the Company’s shareholders and to afford an incentive to such officers, employees, consultants and advisors to continue as such, to increase their efforts on the Company’s behalf and to promote the success of the Company’s business. The Plan was administered by the Company's Compensation Committee (the "Compensation Committee"). The maximum number of the Company's common shares, par value $0.001 per share (the "Common Shares") reserved for the grant of awards under the Plan was 1,500,000, subject to adjustment as provided in Section 5 of the Plan. The number of shares issuable to any one individual in a plan year was also limited to 100,000 shares, subject to adjustment as provided for in the Plan.

On July 9, 2025, the Company adopted the 2025 Omnibus Incentive Plan (the "2025 Plan"), which replaced the Plan. The purpose of the 2025 Plan is consistent with that of the Plan and the maximum number of Common Shares reserved for grant of awards under the 2025 Plan is 2,936,762. The number of securities remaining available for future issuance under the 2025 Plan as of December 31, 2025 was 2,553,447.

The table below summarizes the Company’s awards granted, forfeited, or vested under the Plan and 2025 Plan during the years ended December 31, 2025 and 2024:

During the years ended December 31, 2025 and 2024, the Company granted an aggregate of 1,150,983 and 212,857, respectively, of restricted Common Shares under the 2025 Plan and the Plan. Of the 1,150,983 shares granted during the year ended December 31, 2025, a grant of 420,168 shares was rescinded immediately after the grant as discussed further below. Excluding the grant of 420,168 shares that was rescinded, grants during the year ended December 31, 2025 had a grant date fair value of $0.9 million.

On March 10, 2025, the Compensation Committee authorized (i) a grant of 420,168 restricted Common Shares to John L. Villano, which shares had a fair market value on the date of grant of approximately $0.5 million; and (ii) a one-time bonus grant of 20,000 restricted Common Shares to each of the Company’s directors other than Mr. Villano. Each of the grantees, except for Mr. Walraven, also had the option, at his or her election, to receive the fair market value equivalent of his or her grant in a lump sum cash payment of $23,800. An aggregate of 60,000 restricted Common Shares were granted to the Company’s non-employee directors, which shares had an aggregate fair market value on the date of grant of approximately $71,400. One director elected the cash option.

Subsequent to the Compensation Committee's action on March 10, 2025, authorizing the issuance of 420,168 Common Shares, subject to certain restrictions, to John L. Villano under the Plan, the Company realized that the grant exceeded the 100,000 share limit on grants to any single individual in any one year set forth in the Plan by 320,168 shares. In addition, upon further investigation, the Company determined that restricted stock grants made to Mr. Villano with respect to calendar years 2023 and 2024, exceeded the Plan's 100,000 share limit by 30,890 and 11,857 shares, respectively. Thus, in the aggregate,362,915 restricted shares were issued in excess of Plan limitations. All such shares were unvested and subject to restriction. In an immediate full and in excess of necessary remediation of this matter, on March 24, 2025, the Compensation Committee rescinded the March 10, 2025 award to Mr. Villano ab initio. No other over issuances have been identified and no applicable adjustment have been identified.

With respect to the restricted Common Shares granted during the year ended December 31, 2025 and excluding the 420,168 share grant rescinded, the grants had the vesting dates as follows:

Stock-based compensation for the years ended December 31, 2025 and 2024, was $0.8 million and $0.9 million, respectively. As of December 31, 2025, there was unrecognized stock-based compensation expense of $0.7 million.

Employee Benefits

On April 16, 2018, the Company's board of directors (the "Board") approved the adoption of the Sachem Capital Corp. 401(k) Profit Sharing Plan (the “401(k) Plan”). All employees who meet the participation criteria are eligible to participate in the 401(k) Plan. Under the terms of the 401(k) Plan, the Company is obligated to contribute 3% of a participant’s compensation to the 401(k) Plan on behalf of an employee-participant. For the years ended December 31, 2025, and 2024, the 401(k) Plan expense was $0.1 million and $0.1 million, respectively, and is included under Compensation and employee benefits in the Consolidated Statements of Operations.

17. Equity

Series A Preferred Stock

The Company has designated 3,332,000 shares of its authorized preferred shares, par value $0.001 per share, as shares of Series A Preferred Stock (the “Series A Preferred Stock”) with the powers, designations, preferences and other rights as set forth in an Amended and Restated Certificate of Designation (the “Series A Designation Certificate”). The Series A Designation Certificate provides that the Company will pay quarterly cumulative dividends on the Series A Preferred Stock, in arrears, on the 30th day of each of March, June, September and December, and including, the date of original issuance of the Series A Preferred Stock until redeemed at 7.75% of the $25.00 per share liquidation preference per annum (equivalent to $1.9375 per annum per share). The Series A Preferred Stock is not redeemable before June 29, 2026, except upon the occurrence of a Change of Control (as defined in the Series A Designation Certificate). On or after June 29, 2026, the Company may, at its option, redeem any or all of the shares of the Series A Preferred Stock at $25.00 per share plus any accumulated and unpaid dividends to, but not including the redemption date. Upon the occurrence of a Change of Control, the Company may, at its option, redeem any or all of the shares of Series A Preferred Stock within 120 days after the first date on which such Change of Control occurred at $25.00 per share plus any accumulated and unpaid dividends to, but not including, the redemption date. The Series A Preferred Stock has no stated maturity, is not subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless repurchased or redeemed by the Company or converted into Common Shares in connection with a Change of Control by the holders of the Series A Preferred Stock. Upon the occurrence of a Change of Control, each holder of Series A Preferred Stock will have the right (subject to the Company’s election to redeem the Series A Preferred Stock in whole or in part, as described above, prior to the Change of Control Conversion Date as defined in the Series A Designation Certificate) to convert some or all of the Series A Preferred Stock held by such holder on the Change of Control Conversion Date into a number of the Common Shares determined by formula, in each case, on the terms and subject to the conditions described in the Series A Designation Certificate, including provisions for the receipt, under specified circumstances, of alternative consideration as described in the Series A Designation Certificate. Except under limited circumstances, holders of the Series A Preferred Stock generally do not have any voting rights. The Company has reserved 83,300,000 Common Shares for issuance upon conversion of the Series A Preferred Stock.

At-The-Market Offerings

On August 24, 2022, the Company filed a prospectus supplement to its Form S-3 Registration Statement covering the sale of up to $75.0 million of its Common Shares and shares of its Series A Preferred Stock with an aggregate liquidation preference of up to $25.0 million in an “at-the market” offering (the “ATM Offering”). On June 17, 2024, the Company filed a new prospectus supplement (the “New Prospectus Supplement”) which modified the ATM Offering by reducing the amount of Common Shares the Company may offer and sell up to an aggregate of $48.7 million, including the Common Shares the Company has already sold in the ATM Offering prior to the date of the New Prospectus Supplement All the other terms of the ATM Offering remained the same. In February 2025, the effectiveness of the S-3 Registration Statement expired and, as a result, the ATM Offering terminated. On November 11, 2025, the Company filed a prospectus supplement to its Form S-3 Registration Statement covering the sale of up to $18.45 million of its Series A Preferred Stock in a new ATM offering (the "New ATM Offering")..

During the year ended December 31, 2025, the Company sold no Common Shares and sold an aggregate of 6,010 shares of Series A Preferred Stock having an aggregate liquidation preference of $0.1 million, realizing gross proceeds of $0.1 million (representing a discount of 25.5% from the liquidation preference). The Company’s issuance costs for Series A Preferred Stock shares sold during the year ended December 31, 2025 were de minimis. During the year ended December 31, 2024, the Company sold an aggregate of 276,825 shares of Series A Preferred Stock having an aggregate liquidation preference of $6.9 million, realizing gross proceeds of $5.7 million (representing a discount of 15.9% from the liquidation preference) and an aggregate of 568,711 Common Shares, realizing net proceeds of $2.1 million. At December 31, 2025, $18.3 million of Series A Preferred Stock were available for future sale under the New ATM Offering.

Repurchase Plans

In October 2022, the Board adopted a stock repurchase plan (the “Original Repurchase Plan”), pursuant to which the Company may repurchase up to an aggregate of $7.5 million of its Common Shares. Under the Original Repurchase Plan, share repurchases were made from time to time on the open market at prevailing market prices or in negotiated transactions off the market in accordance with applicable federal securities laws, including Rule 10b-18 and 10b5-1 of the Exchange Act. The Original Repurchase Plan expired on October 9, 2024.

Effective on October 10, 2024, the Board replaced the Original Repurchase Plan with a new stock repurchase plan (the “New Repurchase Plan”). Under the New Repurchase Plan, the Company may repurchase up to an aggregate of $5,802,959 (the amount remaining under the Original Purchase Plan) of Common Shares and share repurchases will be made from time to time on the open market at prevailing market prices in accordance with applicable federal securities laws, including Rule 10b-18 of the Exchange Act.

During the year ended December 31, 2025, the Company did not repurchase any Common Shares. During the year ended December 31, 2024, the Company repurchased an aggregate of 581,745 Common Shares at a total cost of $1.5 million.

18. Earnings (Losses) Per Share

Basic and diluted earnings (losses) per share are calculated in accordance with FASB ASC 260 (Earnings Per Share). Under FASB ASC 260, basic earnings per share is computed by dividing net income (loss) available to the common shareholders by the weighted-average number of Common Shares outstanding for the period. The computation of diluted earnings (losses) per share is similar to basic earnings (losses) per share, except that the denominator is increased to include the potential dilution from the Company's unvested restricted stock awards that contain non-forfeitable rights to dividends so therefore deemed to participating securities for Common Shares using the treasury stock method. The numerator in calculating both basic and diluted earnings (losses) per Common Share for each period is the reported net income (loss) available to common shareholders.

For the year ended December 31, 2025, the Company had basic and diluted weighted average Common Shares outstanding of 46,893,413, resulting in basic and diluted earnings per Common Share of $0.04. For the year ended December 31, 2024, the Company had basic and diluted weighted average Common Shares outstanding of 47,413,012, resulting in basic and diluted loss per Common Share of $(0.93).

19. Limited Liability Company ("LLC") Investments

The following table details the carrying value of each investment reflected on the Consolidated Balance Sheets as of December 31, 2025 and 2024:

Shem Creek (“Shem”)

As of December 31, 2025, the Company had invested an aggregate of $36.6 million inseven limited liability companies (“LLC’s”) (all of which have elected to be taxed as partnerships). The Company’s interest in each of these entities is both “non-controlling” and lacks the ability for “significant influence” as considered under FASB ASC 810, 321 and 323. The Shem LLC’s are commercial real estate finance companies that provide first mortgage debt capital solutions to local and regional commercial multi-family real estate owners in the Northeastern United States. The Company has no management or voting rights in the operations of any of the Shem LLC’s.

In September 2024, the Company acquired the seventh ownership interest, a 20% membership interest in Shem Creek Capital, LLC, the management company of all Shem Creek investment vehicles. At close, the Company paid $2.5 million in cash. In February 2025, the Company paid the remaining $2.5 million in cash to complete the acquisition of the 20% membership interest. In addition, the Company has the right to acquire an additional 10% interest (increasing its stake to 30%) intwo separate 5% options of $1.4 million and $1.5 million at any time prior to March 31, 2027. The Company has no management or voting rights of any significance in the operation of the entity, nor any board representation, but is allowedone ofthree investment committee members of Shem Creek Capital, LLC. The remainingtwo ofthree members of the investment committee is comprised of thetwo members who are also the sole manager of the Shem Creek Capital, LLC entity.

The Company accounts for the funds and the manager investments at the measurement alternative of cost less impairment, adjusted for observable price changes, because the Company does not manage the fund or management entities in which it holds an interest. The Company has no control by contract or influence over operating and financial policies through member voting rights or deemed to have significant influence over the investments, even though FASB ASC 323-10-30-299-1 would presume such based on membership percentage owned levels being greater than 3% – 5%. The Company has assessed FASB ASC 321, 323 and 810 and has concluded that Predominant Evidence to the Contrary does exist in accordance with FASB ASC 323-10-15-10 based on full context and operations of all the individual LLC operating agreements. The Company’s withdrawal from each limited liability company may only be granted by the manager of Shem.

The Company’s investments can be categorized into three fund structures: fund investments, direct loan investments (co-invest vehicles) and the manager investment. The fund investments primarily include investments intwo entities that invest in mortgage loans. The direct loan investments are through three entities whereby the Company directly invests in the participation of individual loans. Both the fund and direct loan structure primarily invest in mortgage loans to borrowers with a majority of the deals being leveraged by a bank. These loans are primarilytwo- tothree- year collateralized mortgage loans, often with contractual extension options for the borrowers of an additional year. The Company receives quarterly distributions from the entities that are comprised of a preferred return, return of capital, and the incentive fee depending on each loan’s waterfall calculation, as defined by the loan agreements. The Company’s interests in the entities are not redeemable at any time, as its investment will be repaid as the underlying loans are repaid. The Company expects to be repaid on its current investments by December 31, 2027. Shem’s compensation includes senior financing fees, incentive fees, and management fees that are charged to each entity that it manages, including theseven entities in which the Company has an investment. The Company expects to receive quarterly distributions from the respective entities operating cash flows.

For the years ended December 31, 2025 and 2024, the Shem investments generated interest income of $4.8 million and $5.1 million, respectively, for the Company, and management fee income of $0.5 million and $0.1 million, respectively, for the Company.

At December 31, 2025, the Company had unfunded commitments totaling $1.4 million in the Shem LLCs.

Cordo CLT Investors LLC

In September 2024, the Company, through its wholly owned subsidiary Urbane Capital, LLC, initially acquired a 21.6% interest in Cordo CLT Investors LLC for one time contribution of $2.5 million. As the remainder of committed common member equity is received by Cordo CLT Investors LLC, the Company’s membership interest declined to 7.2%. This entity was formed for the sole purpose of developing a commercial multifamily property in Charlotte, North Carolina. The Company anticipates the project to be completed by the end of 2026. The Company also accounts for this member investment at FASB ASC 321 measurement alternative at cost, less impairment, because the Company does not manage the entity in which it holds an interest and has no contractual control, voting powers or significant influence over the entity’s operating and financial policies of any kind by contract of the operating agreement.

20. Income Taxes

To qualify as a REIT for federal income tax purposes, at least 90% of taxable income (excluding 100% of net capital gains) must be distributed to stockholders. REITs that do not distribute a certain amount of taxable income in the current year are also subject to a 4% federal excise tax. Undistributed net income for federal income tax purposes differs from undistributed net income for GAAP purposes primarily due to the recognition of straight-line rent revenue, determining the basis of acquired assets, recording of impairments, the useful life and depreciation and amortization methods for real property and the provision for loan losses for financial reporting purposes versus bad debt expense for federal income tax purposes.

For the year ended December 31, 2025, the Company’s TRS recognized a provision for federal and state income tax of $0,which would be represented in other expenses on the Company’s Consolidated Statements of Operations.

The table below presents the effects of temporary differences that gave rise to significant portions of deferred tax assets and liabilities as of December 31, 2025:

At December 31, 2025, the Company’s TRS had federal net operating loss carryforwards of approximately $4.1 million. These losses were generated after 2017 and therefore may be carried forward indefinitely but may be used to offset only 80% of taxable income in any given year.

The Company evaluates the realizability of deferred tax assets based on available evidence, including the history of taxable income and projected future taxable income of the TRS.

Because the TRS has generated cumulative losses in recent years and uncertainty exists regarding the timing of future taxable income, management concluded that it is more likely than not that the deferred tax assets will not be realized. Accordingly, the Company recorded a valuation allowance against substantially all deferred tax assets at December 31, 2025.

The income tax provision for the Company differs from the amount computed from applying the statutory federal income tax rate to income before income taxes due to non-taxable REIT income and other permanent differences including the non-deductibility of acquisition costs of business combinations for federal income tax reporting.

The Company has determined that there areno uncertain tax positions requiring accrual or disclosure in the accompanying consolidated financial statements as of December 31, 2025.

21. Subsequent Events

The Company evaluated subsequent events from January 1, 2026 until the financial statements were issued.

On January 1, 2026, the Company granted 282,217 restricted Common Shares, net of shares surrendered to cover taxes, to employees under the 2025 Plan. The grant date fair value of these awards was $0.3 million.

On January 21, 2026, the Company entered into Amendment No. 2 to the Needham Credit Facility as discussed in Note 9 above

On March 4, 2026, the board of directors authorized and the Company declared a dividend of $0.484375 per share on the Company’s 7.75% Series A Cumulative Redeemable Preferred Stock (“Series A Preferred”) payable on March 30, 2026 to Series A Preferred shareholders of record on March 15, 2026. The payment represents the full amount of the dividend accruing from December 30, 2025 through and including March 29, 2026.

On March 4, 2026, the Board authorized and declared a quarterly dividend of $0.05 per common share to be paid to shareholders of record as of the close of trading on the NYSE American on March 15, 2026. The dividend is payable on March 30, 2026.