Company: SQFTP
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001437749-25-026786
Chunk: 130

Company: Presidio Property Trust, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 130
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 from the estimates. Although our strategy is to hold our properties over the long-term, if our strategy changes or market conditions otherwise dictate an earlier sale date, an impairment loss
      may be recognized to reduce the property to fair value and such loss could be material.

      We review the carrying value of each of our real estate properties regularly to determine if circumstances indicate an impairment in the carrying value of these investments exists. During the 
     six months ended  June 30, 2025 and 2024, we recognized non-cash impairment charges of approximately 
     $0.1 million and 
     $0.2 million, respectively, related to model homes.  Additionally, during the 
     six months ended  June 30, 2025 and 2024, we recognized non-cash impairment charges of approximately 
     $4.2 million and 
     zero, respectively, on commercial properties, specifically Dakota Center and Shea Center II.

   The new impairment charges for the model homes, during the three months ended  June 30, 2025, reflects the estimated sales prices for these specific model homes in  July and  August 2025 as a result of an abnormally short hold period, less than two years.  As noted below in Note 3 - Recent Real Estate Transactions, during the six months ended  June 30, 2025, we sold 13 model homes for approximately $5.9 million, net of sales costs, and the Company recognized a net gain of approximately $0.6 million.
    
   Fair Value Measurements.  Certain assets and liabilities are required to be carried at fair value, or if long-lived assets are deemed to be impaired, to be adjusted to reflect this condition. The guidance requires disclosure of fair values calculated under each level of inputs within the following hierarchy:
    
     •  Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; 

     •  Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and 

     •  Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable. 

   When available, we utilize quoted market prices