Company: SQFTP
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001437749-25-010185
Chunk: 790

Company: Presidio Property Trust, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1
Chunk 790
---
 recognized a gain of approximately $3.4 million.  We expect to record a net gain on model home sales in the first quarter of 2025 as well. The impairment to goodwill was related to NTR Property Management and the fair market value adjustment based on future expected cash flows. 

During the year ended December 31, 2023, we recognized a non-cash impairment charge of approximately $3.2 million related to goodwill and model homes. Of the $3.2 million impairment for the year, approximately $2.0 million was related to our One Park Center property, approximately $0.4 million was related to eight model homes, and approximately $0.8 million was related to goodwill impairment. The impairment charge for One Park Center reflects management’s revised estimate of the fair market value based on sales comparable of like property in the same geographical area as well as an evaluation of future cash flows or an executed purchase sale agreement.

Interest Expense-mortgage notes. Interest expense, including amortization of deferred finance charges was approximately $6.1 million for the year ended December 31, 2024 compared to approximately $5.0 million for the same period in 2023, an increase of  approximately $1.0 million, or 20.9%. The increase in mortgage interest expense relates to the increase in weighted average interest rate from 5.18% to 5.63% over the same time period.  With the sale of our commercial properties in 2025, we will expect interest expense to decrease.

Gain on Sale of Real Estate Assets. For the year ended December 31, 2024, the change in gain on sale relates to the mix and type of properties sold. See Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Significant Transactions in 2024 and 2023 above for further detail.

Income Tax Expense / Benefit. For the year ended December 31, 2023, the Company recorded a benefit of approximately $335,780 related to estimated refunds from federal and state taxes for capital gains from the sale of model homes held by the taxable REIT subsidiary.  For the year ended December 31, 2024, the Company recorded an expense of approximately $60,855 related to federal and state taxes for capital